HomeMy WebLinkAboutMinutes - Water Utility Commission - 2/9/2009 iTE
MINUTES #
ORO VALLEY WATER UTILITY COMMISSION
MONDAY, FEBRUARY 9, 2009
HOPI CONFERENCE ROOMIIIi%I31
11000 N. LA CANADA DR IE
a
CALL TO ORDER
6:00 P.M.
ROLL CALL
PRESENT: David Powell, Chair
Winston Tustison, Vice Chair
Rick Davis, Commissioner
Elizabeth Shapiro, Commissioner
ABSENT: John Hoffmann, Commissioner
EXCUSED: Robert Milkey, Commissioner
STAFF PRESENT: Philip C. Saletta, Water Utility Director
Shirley Seng, Utility Administrator
David Ruiz, Engineering Division Manager
STAFF ABSENT: Robert Jacklitch, Project Manager
CALL TO AUDIENCE: Chair Powell mentioned that members from the audience are
allowed to speak during "Call to Audience" and can address their issue by completing a
blue speaker card.
There were no speakers.
1. APPROVAL JANUARY 12, 2009 MINUTES
MOTION: A motion was made by Commissioner Davis and Seconded by Commissioner
Shapiro to approve the January 12, 2009 minutes. MOTION: CARRIED, 4-0.
2. UPDATE ON DISCUSSIONS WITH TUCSON WATER
Mr. Saletta discussed the following:
-Letter to Jeff Biggs, Tucson Director was included in the Commission's
packet. The letter discusses two Intergovernmental agreements.
-IGA Water Service Oracle Road: This agreement requests extension of the
current Water Service 16" pipeline along Oracle Road & South of Hardy Road. The IGA
was approved in May 2004 and will terminate in May 2009. The Water Utility entered this
agreement with the purpose to allow development of commercial businesses along
Oracle Road near Hardy Road where fire flow could not be provided by Tucson Water.
'he agreement allows the Town to receive all revenues and impact fees. However, if
Tucson Water wishes to purchase the pipeline they would need to pay for any stranded
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costs of the pipeline or Oro Valley also has the option of taking over this area from
Tucson Water. We have discussed this with Jeff Biggs and his Staff from Tucson Water
we have §reto draft a 3-year extension until May 2012 for this 1GA.
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IG �'RecI n�ed��Water: This IGA will terminate October of 2010. The current pricing in
the IGA includes Operations and a Maintenance component on an interim 5 year basis.
To resolve this pricing it has been discussed that a capital component could be included
in the rate payment. to Tucson Water. The reason this is needed is that after October,
2010 Tucson Water can interrupt Oro Valley's reclaimed water supply if the IGA is not
renegotiated. Staff will continue to move forward with Tucson Water and prepare an
addendum or amendment to the existing IGA.
Mr. Saletta ended his report. There were no questions. No Action required on this item.
3. DISCUSSION REGARDING WATER WAYS AND ORO VALLEY VISTA
Ms. Seng reported the following:
-Commission's Packet — Copy of February Oro Valley Vista Publication. Ms. Seng
explained that the O.V. Vista is a Town publication replacing numerous publications from
other departments within the Town and consolidating all publications into one. She
pointed out the Waterways section on page 7. This publication is mailed monthly to
residents in to Oro Valley however it does not reach Countryside residents. Staff
is looking into extending the mailing of the Oro Valley Vista to Countryside or having the
WaterWays section of the publication mailed to Countryside as a separate billing insert
every other month. Staff will also investigate the mailing and printing expenses for the
insert.
Question and Answer Session:
-How many residents in Countryside area? (Chair Powell). Ms. Seng indicated there were
approximately 5000 customers, 2500 connections. Chair Powell asked if there were any
good comments from the residents regarding the O.V. Vista as opposed to the single
WaterWays publication. Ms.Seng indicated she had not received any feedback from the
public.
Mr. Saletta assured the Commission that Staff was making every effort to get the
information out to all customers.
There were no further questions. No Action required on this item.
4. DISCUSSION REGARDING THE GALLONS PER CAPITA DAY PROGRAM AND
THE NON PER CAPITA CONSERVATION PROGRAM
Philip reported that D. Ruiz, K. Boyce and J. Tanler met Thursday, February 5th at
Arizona Department of Water Resources (TAMA). We discussed Gallons per Capita
Day (GPCD) exceedance. Arizona Department of Water Resources (ADWR) goal is
to get water providers to sign up for the Modified Non Per Capita Conservation program
under the Third Management Plan and prior to the Fourth Management Plan.
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Ms. Boyce will be setting a meeting March 2nd with the Conservation Subcommittee to
review the list of Best Management Practices as part of the Modified Non Per Capita
Conservation Program (NPOOP). Mr. Saletta mentioned that it was very important for the
Utility to become active in this program.
ADWR indicated that Oro Valley Water has not exceeded their GPCD in 2006 and
preliminary calculations indicate that Oro Valley did not exceed it in 2007. in addition,
Oro Valley also has not had problems with unaccounted-for-water loss
exceedance. ADWR has indicated that if a water provider is in compliance in later years
than no further action may be needed. This is still being decided by ADWR.
The List of Best Management Practices was reviewed. The Conservation
Subcommittee will make a selection of 5 management practices from the list.
Mr. Saletta expects to hear back from ADWR about the GPCD program in the near
future. The Best Management Practices will be presented to the Commission for
recommendation and then to Town Council.
Chair Powell pointed out that the Utility was already initiating some of the practices from
the list.
Question and Answer Session
-Oro Valley Water Per Capita Per Day exceedance (Commissioner Shapiro). Mr. Saletta
explained Oro Valley's population 2006-2007 and ADWR's gallons per capita per day
calculations and the population census numbers for that period. Years 2000-2005 O.V.
exceeded its ground water allotments due to Oro Valley's five and one-half golf courses,
however Oro Valley had allotments for only three and one-half golf courses. Since
Vistoso and Stone Canyon golf courses were built after 1994 they were not included in
the ground water allotment for the GPCD program.
-When was the Rancho Vistoso parcel annexed to Oro Valley? (Chair Powell). Ms. Seng
explained that Rancho Vistoso was annexed in the early 90's.
There were no further questions, Mr. Saletta ended his report. No Action Taken on this
Item.
5. NORTHWEST WATER PROVIDERS CENTRAL ARIZONA PROJECT WATER
TREATMENT AND DELIVERY SYSTEM UPDATE
Mr. Saletta proceeded to give a slide presentation on the pipeline routing. An explanation
was given of O.V. pipeline route, alignments and various alternatives for the N.W. Water
Providers: Metro Water, Town of Marana, and Flowing Wells. The water delivery is
based on deliveries as follows: Flowing Wells- 3,000 acre-feet, Oro Valley — 10,000 acre-
feet, Metro Water - 10,000 acre-feet and the Town of Marana - up to 7,000 acre-feet. Oro
Valley is at the furthest and the highest elevation compared to the other providers.
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Oro Valley will need to pump water to C-Zone and will need to build its own pump
station to get from A to C zone areas. All the other providers need only A-Zone water and
have no need to pump their water an additional 200 feet higher. The consulting
engineers —Westland Resources and Carollo Engineers will be looking at some
additional sub-alternatives to address these concerns and optimize the last segments of
the pipeline and pump system.
Question & Answer Session
-What is the difference in pipe diameter in C compared to A Zone? (Chair Powell). Mr.
Ruiz explained that it was a network pipe system not a large pipe with a series of
intertwined interconnected pipes. He explained that the installation of a new pipeline must
be analyzed through a modeling program; however through this process the Utility
may need to upsize some pipeline. At this time we will be using the existing pipeline to
move water. Mr. Saletta also explained that there were 8-inch and 12-inch pipelines
throughout our distribution system.
-What are the pumping costs over 10-15 year period and how do they differentiate within
the different zones? (Vice Chair Tustison). Mr. Saletta explained the cost effectiveness
pumping to A Zone verses other zones. He explained that the Utility will analyze power
on an annual basis and then prepare a net present value of these costs over 20 years.
-What are the Right-of-Way criteria ? (Chair Powell). Mr. Saletta pointed out the Segment
Ranking slide. The Utility has a ranking system in place that includes Environmental
Regulatory Requirements, Utility Relocations, Public Disruptions, Pavement
Replacement, and Easement Acquisitions. Each segment is reviewed observed and
ranked systematically. The five criteria's are evaluated and applied to the pipe and pump
routing segments.
Mr. Saletta explained that Oro Valley was exploring other sub-alternatives. For example:
Camino de Oeste & Thornydale. He explained that Tucson Water continues to work in the
reverse osmosis/slowsand filtration pilot study and laboratory analysis from the water
quality side but they have not shown any interest in the pipeline aspect of the project. Mr.
Saletta clarified that the Northwest Partners would build and operate their own water
treatment plant.
-In answer to Vice Chair Tustison question, Mr. Saletta pointed out Tucson's
Water service area and its service boundary to Marana.
-If negotiations slow down between Marana and Tucson Water will it delay the final
decision were the pipeline will be? (Vice Chair Tustison). Mr. Saletta felt that the
pipeline would not be delayed but Marana would need to make a decision about over-
sizing the pipeline.
-What is the time frame for the Final Report? (Commissioner Davis). Mr. Saletta indicated
that the report could be finalized in two months. The pipeline routing and cost will need to
be in place followed by the design of the pipeline & pump stations.
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The next steps are to finalize Task 3 technical memo, Evaluate the proposed sub-
alternatives, finalize the route selection, finalize the report.
Handout: D. Andrews, Town Manager's letter dated 1.29.09 to Arizona State Land
Commissioner, Ref: NW Water Providers CAP Water Treatment and Delivery System
Project. In the event that State Lards is annexed the Town is asking for their support on
this water project. Recently the Central Arizona Water Conservation District
supported moving forward with the design on the N.W. reliability.
There being no further questions, Mr. Saletta ended his report. No Action Taken on the
Item.
6. DISCUSSION REGARDING THE APPLICATION FOR THE ARIZONA WATER
INFRASTRUCTURE FINANCING AUTHORITY PROJECT PRIORITY LIST
Mr. Saletta reported the following:
-Packet attachment-- Projects List submitted for the Arizona Water Infrastructure
Financing Authority Project Priority List.
Federal Stimulus package: Staff believes that any monies that become available to the
State for infrastructure will go through the Governor's office for proper disposition. Any
projects related to water or wastewater will go to Arizona Water Infrastructure Financing
Authority. Two years ago the Utility borrowed monies for the Reclaimed Water System
from WIFA and saved a whole percentage point and also reduced fees. Staff would like
to consider borrowing monies for several projects.
-Northwest Water Providers CAP Water Treatment & Delivery System Design.
(O.V. application request $4,000,000, Metro Water request $4,000,000). Mr. Saletta
continued to give a breakdown of the Utility's Capital Improvement Projects (Phase 1 &
Phase 2). All projects have been submitted to Arizona Water Infrastructure Financing
Authority. Mr. Saletta explained that the Finance Subcommittee at WIFA has approved
and recommended that the projects be considered for the Project Priority List. WIFA will
notify the Water Utility with their decision; Staff will also notify the Commission and
forward it to Council for approval and loan and authorization.
Staff believes that by obtaining a lower interest rate now it would save the Utility in
the financing interest and debt service. Mr. Saletta requested that the Water Utility
Commission approve moving forward with the Arizona Water Infrastructure Financing
Authority application.
Ms. Seng clarified that there were three separate WIFA applications: CAP Water
Treatment & Delivery System Design, Phase 1 and Phase 2. Although these projects are
placed on the Priority List it does not obligate the Town to apply for WIFA funding.
Chair Powell requested a motion from the Commission.
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MOTION: A motion was made by Vice Chair Tustison and Seconded by
Commissioner Shapiro recommending that Water Utility Staff move forward with
the application for Phase 1 Project, Phase 2 Project and the CAP Design Project
and that they be included on the WIFA Priority Project List. MOTION carried, 4-0.
7. WATER RESOURCE MANAGEMENT
Mr. Saletta discussed that there was a recent article regarding Tucson Water selling
ground water storage credits. He indicated that they were not permanently selling or
transferring any of their CAP allocation or subcontract water. They have previously stored
CAP water in their recharge facilities and are trying to sell this stored water. They will use
the revenues to continue to buy their CAP allocation and recharging it to the same
locations. He explained the stored water would than be available as ground water storage
credits.
Mr. Saletta has contacted Jeff Biggs, Director of Tucson Water, and is pursing
discussions regarding the possibilities of Oro Valley acquiring Tucson Water's GW
Extinguishment Credits which could be utilized to offset the Town's ground water
pumping. The purchase of the Extinguishment Credits would be valuable, because it
would save money by reducing the Utility's payments to Central Arizona Groundwater
Replenishment District while maintaining Oro Valley's Groundwater Allowance Account
Balance.
-Oro Valley Request for Funds: Staff estimates if 4000 af of Tucson's Water GW
Extinguishment Credits could be purchase and approved by Council an additional $100 to
$150 per af would be saved compared to CAGRD payments of (Approx. $333 per
af). The Utility could save an additional $400,000 over the next two years after payment is
made to Tucson Water.
Staff plans to continue discussions with Tucson Water unless there are any objections
from the Commission. This item will be forwarded to Council requesting approval and the
appropriation of funds from budgeted contingency funds in the Water Utility Budget.
Question and Answer Session
-In answer to Commissioner Shapiro's question, Mr. Saletta explained the Utility's
savings through CAGRD and the purchases of Tucson's Water Extinguishment Credits.
-In answer to Chair Powell's question about capital costs, Ms. Seng explained that after
Town Council approval, staff could proceed with the transferring of funds from
the Contingency Fund into an expenditure line item to pay for Tucson's Water GW
Extinguishment credits.
-In answer to Vice Chair Tustison question, Ms. Seng explained that she did not have
any information on net income exceeding net expenses at this time, but it could be
obtained through the Munis System.
-In answer to Commissioner Shapiro's question, Mr. Saletta indicated that the monies
paid to CAGRD is a budgeted line item and was paid in October 2008. He explained that
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Tucson Water would like to have payment before June 2009.
-In answer to Commissioner Davis question, Ms. Seng indicated that in CY 2008 Oro
Valley delivered approximately 4% less water than in CY 2007, but she believed it did not
affect the Utility financially. Mr. Saletta explained that it will be difficult in the next couple
of years for the Utility in terms of growth but the Utility is currently fine financially. No
Action Taken on this item.
TOWN COUNCIL MEETINGS/COMMUNICATIONS
Vice-Mayor Carter gave a brief Council update regarding the following:
-Boards, Commissions, Committee Selection Process
Council is reviewing the Boards, Committee's and Commission's selection procedure
to help and possibly participate in the interview process. This will help develop an easier
working relationship with Council. Vice-Mayor Carter indicated that OVWU Commission
would probably not change. He mentioned that some of the existing Boards and
Committees do not have a Council Liaison representative. There no questions from the
Commissioners.
-Other Town Council Discussions:
-Town of Oro Valley's Budget deficit of 2.2 million.
-Update: Goldwater Institute Lawsuit (Gift law clause)
-Update: Oro Valley's Businesses and Financial Crisis
-Update: Oro Valley's RTA
Vice-Mayor Carter ended his report.
9. SUBCOMMITEE/COMMISSIONER REPORTS
There were no Subcommittee Reports.
10. STAFF REPORTS
a. Customer Service Report
Ms. Seng provided the following:
-Update 7/1/08 - 1/31/09 Meter Connections
-Total Metered Connections: 18,345
-Projected New Meter Installations FY 08/09: 250
-Actual New Meter Installations 1/31/09: 168
-Projected EDUs: 312
-Actual EDUs 1/31/09: 557
-New meters January 09: 15
-New metered installation summary: Residential = 128 Commercial= 27 Irrigation=12
Reclaim Turf= 2 Turf= -1
b. Update on Meter Replacement Program
-New Position Meter Reader Supervisor: Main objective to implement and monitor meter
replacement program while supervising meter readers. To implement this program it
will require updating data from the existing 18,300 metered connections. The Meter
Readers are also creating work orders for meters registering zero water usage, erratic
usage, checking for accuracy and if necessary, replacing the meters.
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Since July 2008 the Utility has replaced a total of 410 meters and 205 work orders have
been submitted by Customer Service staff. The Utility replaced 504 meters over a 6 year
period without the Meter Replacement Program and increase in staff. It is important to
realize that 410 replacements have taken place in 7 months. At this time there is no
analysis on water usage and how it will affect revenues. Staff will keep the Commission
updated.
c. Capital Projects
Mr. Ruiz reported on CIP for Mr. Jacklitch:
-Pusch View Lane Well C9 - Construction is complete. Chlorination and flushing of the
well is being done.
-La Canada Reservoir: Capacity - 3.0 MG (E-zone) Location: King Air & Moore Road.
The design and specifications are 99% complete. This project will be out to bid in
February and is currently on WIFA's Priority List - Phase I.
Innovation Way: 16-Inch Water Main is complete. Currently listed on WIFA's Priority List
Phase 1 . This project will be out to bid in February.
Well E1 B Drilling: Staff will be evaluating the bids and selecting a driller.
Staff scheduled a meeting with the homeowners in the surrounding area, however only 1
resident attended out of the 30-40 invitations. Staff is currently working on a plan to help
mitigate noise levels (noise barriers).
-Highlands Main Replacement: Main replacement is about 95% complete. Scheduled
completion: March 2009. Pavement work will be completed by mid-March.
d. Potable and Reclaimed Water Systems Report
Mr. Ruiz reported on the following:
January 2009 Graphs
Potable System: Daily Demand levels decreased = 5 to 6 Million per day
Potable Reservoir Storage: The reservoir demand is doing well.
- Reclaim Water System: Reclaim water total used = 20 Million gallons
Monthly Water Pumped/End User: A brief overview was given.
-EI Conquistador Golf Course South Pond: The Utility is currently doing additional testing
for leaks and checking all components. There is enough water in the pond for operational
usage. When the leak was detected the Utility switched the pond to potable water
for irrigation and ADEQ was automatically notified. Every two years ADEQ sends a
representative to check the Reclaim Water facilities and staff was able to accommodate
the representative through this process. Oro Valley Water Utility received a letter
that they were fully compliant.
Mr. Ruiz ended his report. No Action Taken on this Item.
11. DIRECTOR'S REPORT
a. Board and Commission Appointments
Mr. Saletta pointed out that Council will be discussing Boards and Commissions
appointments at the February 18th Council Meeting.
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b. Budget
Handout: General Fund Options for Deficit Reduction -Fiscal Year 2009/10.
Outlines: -Potential Deficit in the General Fund -Options for Council Consideration to
Potential shortfall
In terms of the final budget, the Water Utility will also be reviewing its FY 09/10
projections and applying the same methods based on growth and projected sales.
c. Upcoming Meetings
Mr. Saletta reported:
February 12: La Canada Roadway and Reclaim Water Ribbon Cutting Ceremony
-Location: (Crystal Place & La Canada) Time: 8:00 a.m.
-February 18: Council meeting -Arizona WIFA meeting
March 4: Council meeting -March 5: Citizens Planning Institute (Handout Incl.)
-March 9: WUC meeting -March 17: WRRC Conference (WUC Training credits)
There were no questions, Mr. Saletta ended his report.
12. FUTURE AGENDA ITEMS
There were no Agenda items provided.
CALL TO AUDIENCE
No speakers.
Next Meeting
March 9, 2009 Location: Hopi Conference Room
ADJOURNMENT:
MOTION: A motion was made by Vice Chair Tustison and Seconded by
Commissioner Shapiro to adjourn; MOTION carried, 4-0.
Meeting was adjourned: 7:30 p.m.
Prepared by,
4--"Cux-0
Iris L. Chaparro
Senior Office Specialist.
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