Setup Fees for Water and Sewage Systems
On 31.3.2015, the Water and Sewage Corporations Rules were published (Setup Fees for Water Systems and Sewage Systems), 2015 (Hereinafter: Setup Fee Regulations), which were put into force on 1.5.2015. The Setup Fee Rules were designed to create a source of funding for water and sewage corporations to establish, develop and upgrade the water and sewage systems. The rules set the method for calculating the setup fees, one-time billing tariffs, the area that is billed and the reasons for issuing the setup fees.
Until the setup fee rules were put into force, the water and sewage corporations, including those that are profit-yielding, charged sewage and water pipe levies, based on the tariffs set in the municipal bylaws. The setup fees that were set by the Water Authority replace the sewage and water pipe levies.
Identity of the Debtor
The setup fees determine that a person that owes the payment of setup fees is the ‘property owner’ as defined in paragraph 1 of the setup fees rules.
Setup Fee Tariffs
The setup fee tariff is the same for all types of properties, with the exception of a property of low-density construction. A property of low density construction is defined in paragraph 1 of the setup fee rules as ‘a property designated as residential and whose permitted building rate is up to 5 residential units per dunam, according to the authorized building permit request.’
V.A.T. is added to the setup fees tariff by law, since the VAT is added to the resident’s bill on a separate line.
The setup fee tariffs are updated every January 1st, by their linkage to the weighted index: an index consisting of 50% of the CPI and 50% of the Price Index of Input in Residential Construction, as published by the Central Bureau of Statistics.
When can setup fees be charged?
According to paragraph 9 of the setup fee rules, the reasons for charging setup fees are when:
- A request for a building permit for a property has been authorized.
- The corporation has created the water or sewage system that enables the property’s initial connection to the water supply or the sewage flow or starting with the aforesaid setup steps.
- The corporation has initially connected the property to the water flow or to the sewage flow.
- The corporation was informed that there is irregular construction on the property.
*In cases in which the building permit request has yet to be authorized for the property and the corporation has begun to take steps to create the water and sewage systems or the building permit request has been authorized for construction that is 33% less than the original land for construction, the corporation is entitled to impose upon the property owner to pay an advance on the setup fee bill at a rate of 33% of the original area for construction.
The Area Charged
The setup fee charge is imposed on the construction area only. There is no charge for the area of the land.
The set up fee is imposed upon the total construction area, calculated according to the Planning and Construction Regulations (Calculation of the Areas and Building Percentages in Plans and Permits), 1992, with the exception of the the area of the basement for the parking of vehicles, hereinafter, “The Parking Basement”.
The Parking Basement - is defined as part of the building, where the space between its floor and the bottom of the ceiling is completely or partially below the planned ground level or below the street level along more than one corner of the space, which will be designated, based on the authorized permit, for a basement for parking vehicles.
Charges for partial setup fees
Where there is justification to charge solely for the water system or solely for the sewage system, the property owner will be charged partial setup fees for the component for which there is such justification, until there is additional justification:
- Partial setup fees solely for sewage - 53% of the setup fees tariff.
- Partial setup fees solely for water - 47% of the setup fees tariff.
Taking past payments into account
In the event that a ‘previous payment’ has been paid for the property (for example: a previous payment of full or partial setup fees, a sewage levy or pipe laying levy, co-payments, etc.), there are provisions in the setup fees rules that allow for taking a previous payment into account: In cases in which a previous payment was paid for the land component, and 7 years have not past since the date of the previous payment for the land, and provided that on the date of payment there was a valid city planning outline, in addition to the area for which the previous payment has been made, the ‘adjusted building area’ will also be considered to be an area for which the previous payment has been made. The ‘adjusted building area’ will be calculated as the product of the land area for which the previous payment has been made in a ratio that is between the sewage levy tariff or the pipe laying tariff per square meter of land, and the levy tariff for square meter of construction, as will be in force at the time of the billing, whereby the payment for the land was made, and provided that the rights for building on the aforementioned space appeared based on the city outline plan that was in force on the date of payment for the land. Until 1.5.2020, in cases in which a previous payment was made for a land component and 7 years have elapsed since the date of the previous payment for the land, a 5% reduction will be made in the setup fee tariff in relation to the additional construction area, provided that the additional building rights existed based on the city outline plan in force at the time of making the previous payment for the land.
The process of clarifying the requests for payment
The property owner who has been issued a request for payment is entitled to contact the Company with a request for a clarification of the matter of the request for payment on one of the following subjects:
- The area for which the setup fees were charged.
- The identity of the debtor who is charged the setup fees.
- The existence of a previous payment that requires the cancellation of the charge of part thereof.
- A scribal error, an error in the description of a person or property, date, number or calculation or any other technical error in the payment request.
The request for clarification will be submitted within 30 days of the issuance of the payment request.
The corporation’s answer regarding the results of the clarification will be sent to the applicant within 60 days of receipt of the request.
*The submitting of the request for clarification will not necessarily delay the date of the payment request; however, the corporation is entitled to delay the date of payment until the request is clarified.
* A defect in the request or its not being issued, in and of themselves, will not derogate from the obligation of the property owner to pay the setup fees according to the law.
To submit a request for clarification:
You may contact: The Engineering Director at the Building Levy and Licensing Levy Division - Margarita Sela.
Address: 4 Ha’haroshet St. 3rd floor, Raanana
Reception Hours: Sun. and Fri. - 8:00-12:00, Tues. afternoon - 16:00-18:30
Have additional questions regarding the setup fees? Write to us.
You are invited to enter the Water Authority website, for information regarding the setup fees: http://www.water.gov.il/Hebrew/Rates/Pages/Setup-fees.aspx