The sewer lateral failed three of my nine ADU feasibility screens

I've been circling the service side of this for a while and finally sold something concrete: a pre-design feasibility screen for owners thinking about a backyard unit. Flat $850, two to three days turnaround, no design work, no permit filing. All I do is pull the parcel record, check the current ordinance text for setbacks and max size and parking, measure buildable area against the survey if one exists, call the water and sewer utility for lateral size and connection fee, and call the power utility about service capacity on the existing panel and drop.

Nine lots in the first two months. Six came back buildable with conditions. Three failed, and all three failed on the same thing: a 4 inch clay sewer lateral that the utility wouldn't let a second dwelling tie into without replacement, and the replacement crossed the driveway on two of them. Quotes to fix ran $14k to $31k on top of a build that was already going to be $150k plus.

The part that nearly broke it was the utility calls. My first two took eleven days because I was asking the wrong department and getting bounced. I now have one named contact at each and I ask for the tap size and the connection fee schedule in writing before I ask anything else.

What I'd keep: refusing to do any design. The moment I sketch, I'm on the hook for something I'm not licensed to be on the hook for. What I'd change: the $850 doesn't cover a survey, and on two lots the absence of one made my buildable area a guess. I say that out loud now, in the engagement note.

5 replies

2raj_mehta14CapitalPRO6

Naive question. If the city eventually publishes an ADU pre-check tool with the parcel data in it, which a few have, does your $850 evaporate? Or is the utility phone work the part that can't be automated?

2gregpowell66AG4BPRO8

Sewer is the right first call, so you got that part in the correct order. But I've had more builds stall on electrical than on sewer. Existing 100 amp service, no room in the panel, and the utility wants to upsize the drop and reset the meter base, and now you're looking at a service upgrade plus possibly a trench for the subfeed to the cottage. On a detached unit 60 feet off the house I've seen $9k to $22k just to get power into it, and the timeline on the utility side is whatever the utility says it is. If you're already calling power about capacity, ask them for the interconnection or service upgrade queue time too. That number moves schedules more than price does. Also ask whether they'll allow a subpanel fed from the main house or require a separate service, because separate service usually means separate meter, and separate meter changes who pays the water and power bill, which changes your rent number.

1omar_haddadActivePRO11

What happens to a client who fails your screen and builds anyway? Because they exist. I've had two owners in the last three years hear a real number for the utility work, decide the estimate was pessimistic, and start. Both ended up eating it mid-build when the trench was open and there was no alternative. Does your engagement note say anything about what you told them and when? Scope creep on a build is annoying. Scope creep on advice you gave for $850 is how you end up in a conversation with somebody's attorney.

1monica_tran3SF4CPRO6

Five years into a service business, the thing I'd flag is that $850 for two to three days of your time is fine until you're doing twelve a month and every one has a phone call chain you can't schedule. Price the utility calls separately or build a tiered version, because right now your worst-case lot and your easiest lot cost the same to the client and wildly different to you. The refusal to design is the right line and it's also the thing that keeps your fee small forever. That's a choice, just make it knowingly.

The sewer lateral failed three of my nine ADU feasibility screens

5 replies