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HomeMy WebLinkAboutFEBRUARY 4,1997 I I I 39:0028 '1//0 - "-0 (/,),o./t/) c.c CITY COUNCIL MEETINGS TAPE RECORDED AND ON FILE IN TIIE OFFICE OF TIIE CITY CLERK MINUTES CITY COUNCIL OF TIIE CITY OF ARCADIA ADJOURNED REGULAR MEETING FEBRUARY 4, 1997 The City Council met in an adjourned regular meeting on Tuesday, Februmy 4, 1997 at 6:00 p.m. in the Conference Room of the City Council Chambers. ROLL CALL PRESENT: Councilmembers Harbicht, Kovacic, Young, and Kuhn ABSENT: Councilmember Chang 1. /17 "-0. ~S- It was MOVED by Councilmember Young, seconded by Councilmember Kovacic, and CARRIED to EXCUSE the absence of Councilmember Chang. OTIIERS IN ATIENDANCE: William R. Kelly, City Manager Michael H. Miller, City Attorney June D. Alford, City Clerk James Dale, Administrative Services Director Patrick Malloy, Maintenance Services Director Rita Kurth, Management Analyst, Water Services Division Guy James, Senior Engineering Aide, Water Services Division Bud Holcomb, Utilities Superintendent, Water Services Division Gary Eikennann, Boyle Engineering Corporation Steve Bucknam, Acting City Engineer, Water Master Plan Project Manager PRESENT AnON OF TIIE 20-YEAR WATER MASTER PLAN/FINANCIAL PLAN A comprehensive Water Master Plan has been prepared by Boyle Engineering Corporation which addresses the following major areas: Hydraulic analysis of water system elements; development of a long-range Capital Improvement Program; preparation of a Water Quality Issues Paper; CEQA review and compliance; development of a Financial Strategies Plan. The finn of Boyle Engineering was retained to prepare the Master Plan under the direction of City staff through a Program Manager, IW A Engineers. The primary work effort was completed in December 1995. However. the completion of the plan was delayed so that the Master Plan could be coordinated with the General Plan efforts relative with land use projections. These projections serve as a basis for water demand projections over the planning horizon study period 1996-2015. The Plan also reviewed the proposed Santa Anita Entertainment Complex project. An analysis was run on the potential impact that the project would have on the City's ability to provide water to the general area. The Maintenance Services Director, Patrick Malloy, explained that the last Water Master Plan was prepared in 1978. The current water system is very good, although there are some improvements which need to be done. The Maintenance Services Director reviewed staff's report of the Water Master Plan and presented slides. The City is situated over three groundwater basins and has pumping rights to over 15,000 acre-feet of water per year, which meets almost all 2/4/97 39:0029 of the City's needs. There are emergency connections with the Metropolitan Water District, Southern California Water Company. and the San Gabriel Valley Water District. Replenishment I water may be purchased in the event of additional need. The City has 21 reservoirs with a usable storage capacity of 38 million gallons of water. System needs as identified by the Master Plan call for an increase of9 million gallons by the year 2015. There are 13 active wells in the system today. Production capability of the 13 wells in the City is 21,600 gallons a minute. Current needs of the system for maximum-day demands are for 24,800 gallons a minute. and 27,500 gallons a minute will be needed to meet the growth in the community by the year 2015. Needs of the community are currently being met in water production, By rehabilitating the wells over the next 30 years. replacing three wells, and adding five new wells, the City will be able to meet production demands by the year 2015. The Maintenance Services Director noted that for reservoir storage, the Master Plan took into consideration regulatory requirements in order to meet the needs of the system. There should be in storage 25% of water produced in one day in the event of an emergency or to help meet the maximurn-day demands. With regard to emergency reqnirements, most communities average between one and three days of emergency storage; the City's Master Plan considers two days of emergency storage. Currently the system has 38 million gallons of storage capability, which needs to be increased by 9 million gallons by the year 2015. It is planned to replace and upgrade three aged and deteriorated reservoirs with new, larger capacity tanks, which will increase their total storage capacity from 6.3 million gallons to 14.7 million gallons, The Maintenance Services Director gave details of the water system and answered questions from Council. It is thought that the Water Master Plan can be spread out over a 20-year period, deferring some of the less critical projects to the last 10-year period of the 30-year plan, and still meet the needs of the City under the new proposal. The Water Plan will be updated annually, and 5-year in-depth reviews will be done. Steve Bucknam, Acting City Engineer, IW A Engineers, presented slides and spoke about water quality issues with regard to the Federal Safe Drinking Water Act. Significant in the 19% Act were new rules related to arsenic and radon removal, and a groundwater disinfection rule, Through extensive lobbying efforts, professional organizations such as the American Water Works Association were able to delay the arsenic rule and radon rule, which they considered to be very onerous requirements. The new rules potentially could have resulted in $12 million in additional water quality types of treatments that the City would have to embark on over the 20- to 30-year plan. With regard to CEQA compliance, Mr. Bucknam stated that IW A Engineers worked with Boyle Engineering and coordinated with the General Plan environmental consultant, LSA Associates, and avoided redundancy of efforts and thus reduced costs. After an initial environmental study and a negative declaration, it was decided that mitigating was appropriate, such as providing for adequate traffic control, the potential of endangered species in the area of the Upper Canyon Reservoir, and noise mitigation in the case of some of the well projects. Guy James, Senior Engineering Aide, Water Services Division, explained that staff has looked at ways to fund the water system capital improvement projects. An expenditure of approximately $4 million per year is projected for improvements to the water system, This exceeds what can be done with current reserve funds. One of the things which consultants have recommended is a growth charge to developers--an assessment of new home constructions and new businesses-- ranging from $2,750 to $22,917 per service connection. Staff believes such surcharges would be met by a negative response from developers and the community. Staff also reviewed a "cost for service" rate structure, which assesses the homeowner or business a ready-ta-serve charge depending on the meter size, and would range from $9.94 to $1,326 per billing period, lfwater conservation is adopted, a tiered rate structure could be adopted as an incentive to minimize water use. The average water bill would be increased 11% for a I-inch meter to 39"/0 for an 8- 2 2/4/97 I I '39,::0030 I inch meter, which is a substantial increase in rates than Arcadia citizens are accustomed to, Staff suggests a more realistic approach by: Spreading projects out over 30 years, performing first only that work which is absolutely necessary to benefit the system; changing the planning horizon to 30 years; deferring all non-(;ritical projects to the 20-30 year period; maintaining the rate structure as it stands. with a minimal rate increase and a slight modification to current connection fees to bring the City more on a par with the industry. A 10% across-the-board average water rate increase would provide funds to achieve the City's very aggressive plans within the 3D-year horizon. James Dale, Administrative Services Director, referred to a chart showing water rate increases over the past 14 years, which ranged from 5% to a high of 11 %, averaging 7 1/2% annually. The water system is valued at $ 1 00+ million, and an effort was made each year to generate additioual moneys to set aside in the Water Fund balance. 11 was felt that $20 million was needed, or 20% of the value in teday's dollars of the replacement cost of the system. Mr. Dale pointed out that the cost of a reselVoir is $5-8 million, and a $6-7 million reselVe is not really a lot of money set aside. He presented staff's proposed rate increase alternatives: Alternative A - 10% increase in water rates for the first 5 years; 5% thereafter 15% increase in connection fees for the first year; 10% thereafter Alternative B - 8% increase in water rates for the first 5 years; 5% thereafter 15% increase in connection fees for the first year; 10% thereafter I Alternative C - (maintain current rate structure) 5% increase in water rates 5% increase in connection fees Alternative A would produce a $29 million fund balance after eight years; Alternative B, a little over $21 million; Alternative C would give no additioual fund balance after eight years, and the balance would still be at approximately $6 million, A portion of the 10% recommended water rate increase would go toward operations, the balance would go toward capital improvements. A lengthy discussion ensued. In response to Councilmember Young, the Administrative Services Director slated that the service charge on residents' water bills may be removed if it is determined that Proposition 218 is related to such a charge. Councilmember Kovacic asked if there were any methods that could be built into either the rate structure or the plan itself that would encourage coDSelVation, other than not getting a bigger bill. The Maintenance SelVices Director stated that the City has a water conselVation plan which, when it is in effect, peualizes customers for overuse. With regard to a rate structure based on meter size, Mayor Pro tern Harbicht noted that the bulk of customers have 3/4-inch and I-inch meters and use the bulk of the water. The 5/8-inch hookup is used as a base charge, increasing the charge to others based on their capacity, when in fact their use is less than their capacity. He asked if it might be more fair to tier the structure based on water usage history rather than on the capacity to use, and suggested using the 3/4-inch and I-inch meter sizes as the base and doing the reductions off of that for the smaller, and the increases off of that for the larger. I With regard to charges, staff commented that Alternative A brings rates closer to par with what the industry is using. The City of Arcadia' s connection fees are approximately 40% lower than neighboring water companies. Currently. water rates are not tiered. Alternative A is not a tiered structure, it is a 10% increase based on the water used, The "readiness-to-selVe" charge basically covers operatioual costs. Councilmember Kovacic reiterated he would like to see some kind of water conselVation measure as long as it is fairly imposed, perhaps tying it to a tiered-rate structure, He asked whether, in the various categories of users, there are objective standards as to how much water should be used. Steve Bucknam, Acting City Engineer, noted there are water 3 2/4/97 39: 003,1 districts which have a sophisticated system of evaluating how much usage is wasteful versus what is reasonable for various size properties. In response to Mayor Kuhn, the City Manager stated that the City's goal for either $20 million (Alternative B) or $29 million (Alternative A) in reserves can be adjusted annually; for example, setting a target of $20 to $29 million and reviewing operations and costs every year in the budget. A benefit to adopting the Plan and environmental document now is that they can be used to educate the public about the water system, the rates, and what the City's goal is. By general consent, Council agreed to DIRECT staff to agendize the Water Master Plan document and Water Rate Structure, Alternate A, for Council's approval at a regular scheduled City Council meeting. ADJOURNMENT At 7:02 p.m. the Adjourned Regular Meeting ADJOURNED sine die. BaIbara D. Kuhn, Mayor of the ATTEST: ~. '~~~~ D. Alford, City C \ 4 2/4/97 I I I