Mayor Mueller Announces New Neighborhood Homes Initiative

June 24, 2022 - Mayor James Mueller, along with Public Works Director Eric Horvath and Common Council leaders Sheila Niezgodski and Canneth Lee, announced a New Neighborhood Homes Initiative. The initiative's first steps include policy changes for utility connection fees and a new reimbursement program for the costs of physical connections to water and sewer services. These steps will support the development of more affordable housing in neighborhoods across the city.

"As a growing city, we need to build more homes that our residents can afford," said Mayor James Mueller. "I am proud of our Public Works team for developing these innovative policies and programs to lower the effective cost of housing construction in South Bend. Rising labor, material and home prices make this initiative more urgent than ever."

The policy changes will be made to the current System Development Charges (SDCs), which cover the utility's cost of connecting new developments to water and sewer services. Under the revised policy, SDCs will not apply to infill housing of 5 or fewer units. They will also not apply to housing developments of more than 5 units if they are financed with low-income housing tax credits or are built by a non-profit. The Common Council is expected to begin hearing the ordinance with these proposed changes to the SDCs on Monday, June 27.

A new Sewer Lateral Reimbursement Program will offer a reimbursement up to $20,000 for qualified costs of connecting the sewer lateral to new low- and moderate-income homes. This funding may be used to cover the cost of the entire sewer lateral from the main line to the residential structure. Qualifying costs for reimbursement include labor, materials, traffic control, and restoration of pavement, curbs and sidewalks related to the sewer lateral work. The Board of Public Works will take up this program after the Common Council passes the ordinance amending the SDCs.

"These changes will encourage new homes to be built on vacant lots that will connect to existing water and sewer infrastructure," said Public Works Director Eric Horvath. "This will lessen the burden of building new water and sewer to support developments in undeveloped areas around the City."

Subject to the respective approvals by the Common Council and Board of Public Works, both the revised System Development Charges and the Sewer Lateral Reimbursement Program will be active by mid-July.