LEBANON — City officials say proposed sewer rules that include lifting a partial cap on new projects would spur development and provide more money to maintain and upgrade Lebanon’s wastewater system. They also would come with a set of fees for new hook-ups to the system.

The City Council is mulling a new set of regulations that would do away with a partial building moratorium east of the Terri Dudley Bridge on Route 4 and replace it with a citywide permitting system. A temporary order last year limited hookups on the east side of the city after studies showed a key “interceptor” pipe carrying sewage to the wastewater treatment plant in West Lebanon was nearing 80% capacity.

The proposed rules should “free up a significant amount of sewer capacity,” allowing for much-needed housing projects, Mayor Tim McNamara said on Monday.

Under the new rules, developers would apply for sewer capacity prior to Planning Board review, potentially saving them the trouble of a costly engineering analysis.

City employees would calculate sewer usage based on a development’s proposed use or the number of residential units before issuing a permit valid for two years following Planning Board approval, according to City Manager Shaun Mulholland.

“(Developers) would know if they have sewer capacity or not before they spend all that money trying to put together a full application,” he told the City Council last week.

Applications would cost a minimum of $250, with $100 being added on for each additional residential unit or an equivalent commercial unit. Mulholland said a single sewer “unit” amounts to a three-bedroom, single-family home.

The city also would institute a new development fee, which would be calculated based on the overall size and use of a project. For instance, a $3,006 fee would be levied on a single-family home, while a three-bedroom, three-unit building would be charged $5,153. Each one-bedroom apartment or condo would trigger a $859 fee, according to city calculations.

City officials estimate a new 40-seat restaurant would have to pay $13,275 in fees, a figure that worried City Councilor Karen Liot Hill, who owns The Lebanon Diner.

“That would have been a huge barrier to being able to open,” she told colleagues in an audio recording of last week’s City Council meeting. “That’s a big number for that size of an enterprise.”

The full fee would only be charged to new developments, Mulholland replied, and those seeking to renovate an existing building would be charged less.

How Lebanon calculates sewer capacity also would change so that developers could plan more apartments without hitting limitations. Under the new rules, a studio or one-bedroom apartment is expected to use 60 gallons of wastewater a day. Current regulations set that number at 105 gallons a day.

City officials also would reduce the “peak” level of wastewater those units would be expected to generate in busy times, such as when many people are showering in the morning or doing laundry at night.

McNamara said the changes are possible because the city recently completed a multiyear study of its sewer system and is now more aware of current wastewater flows and pipe sizes. It’s also completing work on a roughly $1 million project in West Lebanon to install larger pipes and nearly double the city’s sewer capacity.

The new rules could prove beneficial in Lebanon, where developers have long complained about the city’s system of calculating sewer flows and capacity.

Lebanon’s current standards are unnecessarily conservative and sometimes run contrary to evidence collected by engineering firms, said Dan Nash, a former city engineer who now works with several developers.

“I think (the proposal) does solve some of those problems,” Nash said in a phone interview on Monday. “There’s things I’d like to see done a little differently but it’s much better than it was.”

Nash said the development fee would amount to a “big bite” for developers to swallow. But, he said, it would allow Lebanon to pay for infrastructure upgrades without burdening existing sewer users.

“I think it’s great we’re finally able to arrive at a solution,” he said.

News of the changes might be less welcome in Enfield, which connects to Lebanon’s sewer system and would be subject to the development fee.

“The reality is that anytime you impose a new fee, it will have an impact on development or people’s pocketbooks,” Enfield Town Manager Ryan Aylesworth said on Monday. “You just hope the impact is relatively less significant.”

Aylesworth predicted the development fee could pose problems for residents along Route 4A, where Enfield recently completed a 1.5-mile sewer extension to the Lakeview Condominium complex.

“It’ll certainly weigh into people’s calculations if they’re on the fence about connecting to municipal sewer,” he said.

The City Council will hold a hearing on the proposed sewer changes at 7 p.m. on Dec. 4 at City Hall. If approved, the new rules would go into effect on Jan. 1, 2020.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.