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Home My WebLink AboutMinutes - Water Utility Commission - 4/14/2008 ilrfq 1 \I � S MINUTES . ORO VALLEY WATER UTILITY COMMISSION (' �'O ITECiii1:1 :.. RE GULAR SESSION APRIL 14,2008 HOPI CONFERENCE ROOM # 11,000 N. LA CANADA DRIVE CALL TO ORDER-AT 6:00 P.M. ROLL CALL - 6:00 P.M. MEMBERS PRESENT: David Powell, Chair Winston Tustison,Vice Chair Robert Milkey,Commissioner John Hoffmann,Commissioner Elizabeth Shapiro,Commissioner MEMBERS ABSENT: Rick Davis,Commissioner STAFF PRESENT: Philip C.Saletta,Water Utility Director Shirley Seng,Utility Administrator Robert Jacklitch,Project Manager Jim Peterson,Water Utility Regional Coordinator OTHERS PRESENT: K.C. Carter, Council member D.McKee,Planning&Zoning Chair CALL TO AUDIENCE -None ITEM #1 APPROVAL OF MARCH 10, 2008 MINUTES- Chair Powell entertained a motion to approve the March 10,2008 minutes. MOTION: Commissioner Shapiro MOVED to approve the March 10, 2008 minutes. Vice Chair Tustison SECONDED the motion.MOTION PASSED:Unanimously. ITEM #2 DISCUSSION REGARDING ARROYO GRANDE - Mr. Saletta reported that the Planning&Zoning Director and the Town Manager were scheduled to attend the meeting but could not attend because of a previous commitment. He proceeded with the power point presentation: • Four Steps - General Plan Amendment, Environmentally Sensitive Lands Ordinance (ESLO),Pre-Annexation Development Agreement, Annexation • General Plan Amendment- Council Motion&Arroyo Grande Planning Area • Negotiation Support and Direct Negotiating Teams • Public Participation for General Plan Amendment • Estimates Costs -Total$510,000 • Timeline & Proposed Schedule • Water Use and Sources of Water Supply Mr. Saletta introduced Doug McKee, Chair of Planning & Zoning Commissioner and welcomed his participation in the presentation. An answer and question session occurred: -General Plan needs voter approval (Chair Powell) - Mr. Saletta indicated that it did not only a two-thirds vote of Council -Adequate Water Supply(Commissioner Shapiro) - Mr. Saletta indicated that water supply is available through our CAP Water but additional CAP may be required and would need to be acquired from State Lands. 4-14-08 MINUTES, ORO VALLEY WATER UTILITY COMMISSION -Definition: Adverse impacts -riparian areas &water withdrawal (Commissioner Hoffmann) - This would be addressed through the General Plan and Open Space. -Role of Scott Ruby, Outside Legal Counsel - (Vice Chair Tustison) - Mr. Ruby has extensive experience in pre-annexation agreements. -Pre-annexation lands & possible development (Chair Powell) - It was discussed that this could take three years to annex,but development would occur over ten to twenty year period or possibly longer. -Possible State Land reclaim water allocation/Availability/Prorate (Chair Powell) & (Commissioner Hoffmann) - If Oro Valley delivers the water,the effluent would belong to Oro Valley. -Sustainable ground water production within State Land areas (Vice Chair Tustison) - There is groundwater available but it would still require replacement in the Tucson Active Management Area under the Groundwater Code. -Hydrogeologic investigations - Potential groundwater production under the State Lands needs to be investigated. The Oro Valley aquifer&replacement of groundwater within Tucson Active Management Area was discussed and the TAMA boundaries/groundwater divide to the north. -O.V.Water Service area expansion&annexation,diminishing water&effects on O.V.wells was discussed. If not annexed, another developer could drill wells and impact the aquifer. If OV developed, we would treat and deliver CAP Water. -Water Conservation important component of new development and should be incorporated into development plans. - The use of Reclaimed Water was discussed and that for turf areas of 2 acres or more, it would be required to use reclaimed water. There were no further questions Mr.Saletta ended his report. No action taken or required on this item. ITEM #3 - RECOMMENDATION TO COUNCIL ON WATER RATES - Vice Chair Tustison opened on behalf of the Finance Subcommittee and requested Ms. Seng to present the Financial Analysis for Water Rates. Ms. Seng presented the following: -Packet Information: 4/4/2008 TCC outlining proposed Water Rates,Fees and charges -Red Oak letter Opinion - The forecasts and underlying assumptions provide a reasonable basis for the projections for the forecast period. -Water Rates Analysis Report Ms. Seng indicated that Staff would be looking for a formal recommendation from the Commission to forward the proposed water rate increases to Council. The presentation discussed the following: Overview -Financial Considerations, Financial Analysis & Assumptions, Preferred Financial Scenario, Alternate Financial Scenario, Comparison of Scenarios, Review of Process, Review of Schedule • Review Schedule -4/16 Town Council - Consider Notice of Intent -4/25 Notice of Intent published -5/02 Mail Public Hearing notice to customer, publish in O.V. Vista, post to Water Utility website -5/21 Public Hearing to consider rate increase, -6/20 If adopted,new water rates are effective An answer and question occurred: -Presentation of Preferred&Alternate scenarios to Council(Commissioner Hoffmann). - Mr. Saletta indicated that the Utility's previous past practices have been to present alternate scenarios to Council. A brief discussion occurred regarding: -O.V.Water deficit and minimizing customer rate shock -Public Hearing would include a presentation of the 5 year financial analysis that outlines the projected differences in rates for the 5-year period with each scenario. It would also explain groundwater preservation fee (GPF). Specify the importance of long term assured water supply,promote water conservation issues -TEP rate increase and rate shock to customers In answer to Chair Powell question, Vice Chair Tustison indicated that the proposed water rate increases were favorably received by Council at the April 9 Study Session. Council member Carter•indicated that Council seemed 2 4-14-08 MINUTES, ORO VALLEY WATER UTILITY COMMISSION satisfied and was fine with moving forward. Commissioner Milkey stated that Council was very concerned about promoting conservation,future study changes in tiers or including additional tiers. There were no further questions Ms. Seng ended her report. Chair Powell indicated there was a motion on the table for the Commission's approval of the Water Rates Analysis report. MOTION: Vice Chair Tustison MOVED to recommend to Town Council that water rate, fees and charges be increased in accordance with the Preferred Financial Scenario as described in the April 16, 2008 Water Rates Analysis Report. In addition, an Alternative Financial Scenario will be submitted with this report to the Council. Commissioner Shapiro SECONDED the motion.MOTION PASSED: Unanimously ITEM#4 WATER DEVELOPMENT IMPACT FEES - Mr. Saletta presented the following: • Packet Information: TCC 3/12 Legislative Update on Proposed Development Impact Fee Legislation • Excerpts from Proposed Senate Amendments to S.B. 1406 • Town Council has concerns that the proposed legislation may have impact on Water Utility's current Alternative Water Development Impact &Potable Water Resources Impact Fees with respect to the approved and scheduled increases that have been approved. • The proposed S.B 1406 was reviewed regarding Paragraph F and that the payment of the fees would not be required for a 24-month period after final plat approval. Mr. Saletta indicated that because of the legislative changes, Staff would be presenting on 4/23 to Council an updated Alternative Water Resources Development Impact Fee & Potable Water Resources Impact Fee report reflecting changes in the original fee calculations. Schedule: 4/23 -Study Session Proposed development impact fees 5/7 Notice of Intent to adopt new fees (60 day waiting period) 7/16 -Public Hearing on potential new fees (30 day waiting period) 8/20-Adoption of potential new fees (90 day waiting period) 11/18 -Effective date of newly adopted fees Mr. Saletta stated that Staff planned to move forward with the water development fee increase and would request that the Commission consider a motion to support Town Management and Water Utility's Staff in preparing the report and changes. An answer and question occurred: -Alternative Water Resources Development Impact Fee working group meetings & staff recent communications with regards to the Proposed Senate Amendments (Chair Powell). There were no further questions. Mr. Saletta ended his report. Chair Powell indicated a motion was on the table to forward the Water Development Impact Fees to Council. MOTION: Commissioner Shapiro MOVED to support Town Management and Water Utility Staff in preparing the required information, documentation and report for Council to increase the Alternative Water Resources Development Impact Fees with no phase-in and allow for an increase in accordance with a Construction Cost Index for both the Alternative Water Resources Development Impact Fees and the Potable Water System Development Impact Fees. Commissioner Hoffmann SECONDED the motion. MOTION PASSED:Unanimously ITEM #5 CENTRAL ARIZONA PROJECT VIDEO - A video presentation and discussion of recent developments and shortages of water to the Colorado River and its effects regarding CAP Water availability. -Commissioner Hoffmann Announcement: 6/24 Meeting: Arizona Water Research Center Phoenix, Topic: Importance of the Colorado River. Commissioner Hoffmann felt it would be a good opportunity for the Commissioners to attend. 3 4-14-08 MINUTES, ORO VALLEY WATER UTILITY COMMISSION -Commissioners Training Credits: Commission to receive one-half hour of training for this video presentation. Video presentation ended. There were no questions. Mr. Saletta ended his report. No action taken or required on this item. TOWN COUNCIL MEETINGS/COMMUNICATIONS - Council member KC Carter reported on the Town Council's monthly activities: • Arroyo Grande Annexation J • Council acceptance WUC Annual Report Council member KC Carter ended his report. No action taken or required on this item. SUBCOMMITTEE REPORTS - Commissioner Milkey reported on the Conservation Subcommittee recent activities. • Drought Response Plan • Historic precipitation data in Oro Valley&possible sites • Water conservation grants through CAGRD. Grants available up to $5000,investigate application process. Commissioner Milkey ended his report. No action taken or required on this item. STAFF REPORTS • Potable &Reclaimed Water Projects -Mr.Jacklitch reported on: -March 2008: Potable Peak Daily Demand Operations/Precipitation Report -March 2008: Potable Operations Report- Reservoir Levels -March 2008:Reclaimed Water System Report-Water Demand No action taken or required on this item. • CEP Projects -Mr.Jacklitch reported on: -Pusch View Lane Bridge Construction is 90%.Project completion:June 08 -Oracle Road Water Main Relocation: Contractor is 90% complete. Scheduled completion:May 08 -Bid Projects: Pusch View Lane Well C-9 advertising 4.14.08. Bid Opens May 9th Award project: End May 08. -Design Projects:King- Air,La Canada 3 MG in-ground concrete reservoir.Design completion:June 08. -Innovation Park Drive Main replacement design scheduled. Design completion:June 08. Mr.Jacklitch ended his report. No action taken or required on this item. DIRECTOR'S REPORT - Mr. Saletta reported on: • Tucson-Pima County Regional Water Study • NW Water Providers Update • Recent Activities and Upcoming Meetings: SAWUA- 4/15; Council - 4/16; Notice of Intent City/County Joint Water and Wastewater Study - 4/18; Council Study Session on Impact Fees - 4/23; New Council Member Orientation- 5/1. No action taken or required on this item. FUTURE AGENDA ITEMS • Approval April 14,2008 minutes No action taken or required on this item. CALL TO AUDIENCE - No Speakers. NEXT MEETING: May 12,2008 Location: Hopi Conference Room 4 4-14-08 MINUTES, ORO VALLEY WATER UTILITY COMMISSION ADJOURNMENT: Chair Powell entertained a motion to adjourn the meeting. MOTION: Commissioner Miley MOVED to adjourn the meeting. Vice Chair Tustison SECONDED the motion.MOTION PASSED: Unanimously Meeting adjourned: 8:00 P.M. Prepared by: Iris L.Chaparro Senior Office Specialist 5