HomeMy WebLinkAboutPackets - Council Packets (775) AGENDA
ORO VALLEY TOWN COUNCIL
STUDY SESSION
JUNE 11, 2008
ORO VALLEY TOWN COUNCIL CHAMBERS
11000 N. LA CANADA DRIVE
STUDY Y SESSION - AT OR AFTER 5:30 p.m.
CALL TO ORDER
ROLL CALL
1. Water Rate Analysis Discussion
Development 2. Alternative Water Resources Impact Fee Discussion
ADJOURNMENT
POSTED: 06/04/08
4:00 p.m.
cp
The Town of Oro Valley complies with the Americans with Disabilities Act(ADA). If any person
with a disability needs any type of accommodation, please notify the Town Clerk's Office at
(520)229-4700.
TOWN OF ORO VALLEY
COUNCIL COMMUNICATION
STUDY SESSION June 11, 2008
TO:• HONORABLE MAYOR AND COUNCIL
FROM: Shirley Seng, Water Utility Administrator
Philip C. Saletta, Water Utility Director
SUBJECT: Water Rates Analysis
SUMMARY:
presented a Notice of Intent to the Town Council to increase the water
On April 16, 2008, Water Utility Staff
Preferred Financial Scenario. Council had concerns regarding
rates based on the Water Utility Commission's to
to continue the Notice of Intent until such time that Staff could respond
the proposed water rates and voted
will be prepared to respond to those concerns and discuss policies and
those concerns. Water Utility Staff
procedures related to water rate increases.
OVWU Staff will discuss the following items as part of our presentation:
➢ Review of Water Utility Funds
➢ Review of Council Policy pertaining to water rates
➢ Elements of the Financial Analysis for water rates
• Water Rate Structure: Base Rate, Commodity Rate and Tiers
➢ Preliminary Financial Scenarios
➢ Customer Billing Analysis
➢ Proposed Process and Schedule
limina financial scenarios which will be discussed regarding the
OVWU Staff has performed two preliminary
relationship between the base rates, commodityrates and the tiers. Conservation pricing is an important aspect
of a tiered rate structure and balancing
conservation with revenues is a key component of the continued
financial solvency of the Water Utility Enterprise.Ente rise. In addition, impacts to certain customer classes are
problematical
depending upon the customer meter size and history of water use.
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to address the Council's concerns; however, these scenarios also need
There are numerous possible solutions
generated from new rates will meet revenue requirements and debt service coverage.
to insure that the revenue .
with policy, future rates should avoid sudden and large-scale shifts in water
In addition, and in accordance
rates. Staff may need to perform additionalanalyses potential of rate scenarios before we return to the Council
rates. This will require additional time and OVWU Staff believes that
with a new recommendation on water q
the earliest we could provide Council
with a revised Notice of Intent would be in August or early September.
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TOWN OF ORO VALLEY
COUNCIL COMMUNICATION Page 2 of 2
ATTACHMENTS:
1) Diagram of the Water Utility Funds with a description of their purpose.
2) Current water rate structure.
3) Copy of Resolution (R) 05-09 Council Water Policies. Please specifically note Section A. Finance on
pages 1 and 2 of the policy document.
Staff will be requesting direction from Council regarding possible financial scenarios and a proposed schedule.
Shirley Seng� Y
Jtilit Admin strator
6:/) IP/441111
Philip C. Saletta, P.E., Water Utility Director
David L. Andrews, Town Manager
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ORO VALLEY WATER UTILITY
NEW RATES ADOPTED BY RESOLUTION NO.(R)07-86 ON JULY 18,2007
RATES EFFECTIVE AUGUST 18,2007
POTABLE WATER RATES
METER BASE RATE COMMODITY COMMODITY COMMODITY COMMODITY SIZE includes TIER 1 TIER 2 TIER 3 TIER 4
ZERO gallons $2.08 PER 1000 GALS. $2.81 PER 1000 GALS. $3.76 PER 1000 GALS.+ $5.00 PER 1000 GALS.
' OVER 32,000
0-7,000 7,001 -16,000 16,001 -32,000
5/8 x 3/4 $13.25 � ,
3/4 x 3/4 $19.90 0-10,000 10,001 -23,000 23,001 -46,000
OVER 46,000
1 $33.00 0-14,000 14,001 -32,000 4 32,001 -64,000
OVER 64,000
1.5 $66.30
0-28,000 28,001 -64,000 - 64,001 -128,000 OVER 128,000
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2 $106.00 0-56,000 56,001 -128,000 128,001 -256,000 OVER 256,000
iOVER 576,000
3 $212.00 0-126,000 126,001 -288,000 288,001 -576,000
4 $332.00
0-175,000 i 175,001 -400,000 400,001 -800,000 OVER 800,000
6 $663.00 0-1,120,000 1,120,001 -2,560,000 2,560,001 -5,120,000 OVER 5,120,000
8 $1,060.00 _ 0-1,120,000 1,120,001 -2,560,000 _ 2,560,001 -5,120,000
OVER 5,120,000
POTABLE WATER CUSTOMERS
GROUNDWATER PRESERVATION FEE: $0.40 PER 1,000 GALLONS
CONSTRUCTION WATER RATES
METER BASE RATE COMMODITY COMMODITY COMMODITY COMMODITY
SIZE includes TIER 1 TIER 2 TIER 3 TIER 4
ZERO gallons COST PER 1000 GALS. ,
1.5 $66.30 r $6.00 N/A N/A N/A
2 $106.00 $6.00 N/A N/A N/A
3 $212.00 $6.00 N/A N/A
N/A
N/A N/A
4 $332.00 $6.00 N/A ,
6 $663.00 $6.00 N/A N/A N/A
8 $1,060.00 $6.00 _ N/A N/A
N/A
Groundwater Preservation Fee applies to all construction water use.
ORO VALLEY WATER UTILITY 18,2007
NEW RATES ADOPTED BY RESOLUTION NO.(R)07-86 ON JULY
RATES EFFECTIVE AUGUST 18,2007
RECLAIMED WATER RATES
COMMODITY COMMODITY
RATE COMMODITY COMMODITY TIER 4
METER BASE TIER 2 TIER 3
SIZE includes TIER 1 GALS. $3.76 PER 1000 GALS. $5.00 PER 1000 GALS.
O gallons $2.08 PER 1000 GALS. $2.81 PER 1000
ZERO
5/8 x 3/4 $13.25 N/A N/A
ALL USAGE N/A 3/4 x 3/4 $19.90 N/A NIA
ALL USAGE N/A
ALLNM
USAGE N/A N/A N/A
NM
$33.00USAGE N/A N/A N/A
ALL
NM
$66.30 USAGE N/A N/A N/A
ALL
Mil
$106.00 USAGE N/A N/A N/A
ALL
$212.00 USAGE N/A N/A N/A
ALL
4 $332.00 USAGE N/A N/A N/A
ALL
6 $663.00 N/A
8 $1,060.00 ALL USAGE
N/A N/A
RECLAIMED WATER CUSTOMERS GALLONS
GROUNDWATER PRESERVATION FEE: $0.25 PER 1,000
CONSTRUCTION WATER RATES
MODITY COMMODITY COMMODITY
BASE RATE COMMODITY COM TIER 4
METER TIER 1 TIER 2 TIER 3
SIZE includes
ZERO gallons COST PER 1000 GALS. N/A N/A
$2.08 N/A N/A
1.5 $66.30 N/A N/A
2 $106.00 $2.08 N/A N/A
$2.08 N/A N/A
3 $212.00 N/A N/A
4 $332.00 $2.08$2.08 N/A N/A N/A
8 $1,060.00 $2.08
N/A
6 $663.00N/A N/A
Groundwater Preservation Fee applies to all construction water use.
RESOLUTION NO. (R) 05- 09
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A RESOLUTION OF THE MAYOR AND COUNCIL OF
' TOWN OF ORO VALLEY, ORO
AMENDING
RESOLUTION NO. 96-87, THE TOWN OF VALLE
WATER UTILITY MAYOR AND COUNCIL WATER
POLICIES
HERE ,
T AS the Town of Oro Valley is a political subdivision of the State of Arizona vested
WHEREAS,
T' allassociated rights, privileges and benefits and is entitled to the immunities and
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exemptions granted political municipalitiesand subdivisions under the Constitution and laws of
the State of Arizona and the United States; and
the Town Council approved on October 23, 1996, Resolution No. 96-87, adopting
the Oro Valley Mayor and Council Water Policies; and
WHEREAS, updatedpolicies olicies will enhance future Town planning and operations of the Water
Utility; and
WHEREAS, it is in the best interest of the health, safety and welfare of the customers of the.Oro
Valley Water Utility to adopt the amended Mayor and Council Water Policies.
NOW, THEREFORE, BE IT RESOLVED by the Mayor and Council of the Town of Oro
Valley, Arizona that the Town of Oro Valley Mayor and Council Water Policies as amended
(attached as Exhibit "A") are hereby approved.
BE IT FURTHER RESOLVED that the Mayor and any other administrative officials of the
Town of Oro Valley are hereby authorized to take such steps as are necessary to execute the
Town of Oro Valley Mayor and Council Water Policies as amended.
BE IT FURTHER RESOLVED that if any portion of these policies is found to not be
enforceable by a court of competent jurisdiction, that portion shall be declared severable, and the
remainder-of the-policies will-remain-in-full-force and effect. -
PASSED AND ADOPTED by the Mayor and Council of the Town of Oro Valley, Arizona this
2nd day of March, 2005.
Mayor Paul H. Loomis
APPROVED AS TO F :
ATTEST: 1
(r.,
V
Kathryn ` velier, Town Clerk Town Attorney
A
C:lDoc mcnts 2n i cttings`,sscngVm
v!v DocucrlslRao]uuoas\Rcso]uiioa ref Adoption of Rc��iscd M&C Water Policics doc
Town of Oso Valleynozncy's Oircdca.N21005
EXHIBIT "A"
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Definitions
ADEQ Arizona Department of Environmental Quality
ADW Arizona Department of Water Resources
Aquifer A subsurface water-bearing soil and/or rock follnation that can
yield water to wells.
Arta f cl al Recharge
echar e The act of purposefully adding water to an aquifer through the
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construction and operation of facilities capable of storing _
renewable water supplies in the ground.
CAP Central Arizona Project
Commission The Oro Valley Water Utility Commission
Cy Charge Char e The unit cost of billed usage, as set forth in the water rates and charges
Cost of Service Charges for water utility shall be made in direct proportion to the
cost of securing, developing and delivering water to the Utility's
various customer classes.
Countryside That portion of the Oro Valley service area
that is located approximately seven miles outside the current.
Oro Valley town boundary.
Customer The person or entity in whose name service is rendered, as
evidenced by the name on the application or contractor for that
service, or by the receipt and/or payment of bills regularly issued
in his name regardless of the identity of the_actual user of the
water service.
Effluent The product of a wastewater treatment plant having received primary
and/or secondary treatment.
Emergency Supply A temporary water supply provided by one water provider to
another water provider for:equipment or system failures and
not for the purpose of resolving deficiencies in the system-that is
requesting the emergency supply.
EPA Environmental Protection Agency
IGA Intergovernmental Agreement
Non-Potable Water Water not fit for human consumption, such as effluent, reclaimed
water and/or untreated CAP water.
Oro ValleyWater The lands represented on the Oro Valley WaterUtility P }� Utiservice
Service Area maps filed annually with the ADWR.
Person Any individual,partnership, corporation, governmental agency,
or other organization operating as a single entity.
Point of Delivery The point where facilities owned, leased, or under license by a
customer connect to the Town water utility's pipes or at the outlet
side of the meter.
-- ----Potable-Water--- Water-which meets EPA and ADEQ drinking water standards.
Potable Water System A planning document that evaluates the potable water system on a
Master Plan capacity basis to determine the needs of existing and future potable
water customers, to identify new capital improvements, project the
time frame for construction of said improvements, and to project
costs for said improvements.
Reclaimed Effluent receiving post-secondary water treatment.
Reclaimed Water System A planning document that evaluates the reclaimed water system
Master Plan on a capacity basis to determine the needs of existing and future
�1 reclaimed water customers, to identify new capital improvements, .
project the time frame for construction of said improvements, and
to project costs for said improvements.
Renewable Water Water other than groundwater including reclaimed water and CAP
Supply water.
State State of Arizona
System The Town of Oro Valley Water Utility, including all personal and
real property.
TAMA Tucson Active Management g nt Area
Utility The Oro Valley Water Utility.
Water Provider An agency serving water to retail customers in a service area
recognized by the ADWR or the Arizona Corporation Commission.
Water Revenue Income derived from the sale of water or other water-related
operations of the Oro Valley Water Utility.
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TOWN OF ORO VALLEY
MAYOR AND TOWN COUNCIL
WATER POLICIES
Adopted October 23, 1996
Resolution No. (R)96- 87 _
Amended March 2, 2005
Resolution No. (R) 05 - c
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Table of Contents
Page
Definitions
Introduction
1
I Assumptions
1
II Policies
A. Finance
1. Enterprise Basis
2
2. Water Rates and Charges
System2
3.
Development Requirements
3
4. Service Area Expansion
4
5. Capital Improvements
4
B. Acquisitions
1. System Acquisitions
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2. Water • '
Rights Acquisitions & Sales
6
C. Water Resource Management
1. Service Area Management
6
2. Water Quality
6
3. Contingency Plans
7
4. Non-Potable Water
7
5. Support of Riparian Areas
6. Recharge
9
D. Conservation I
9
E. Water Infrastructure Security
10
F. PolicyReview Process
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TOWN OF ORO VALLEY
MAYOR AND
COUNCIL
WATER POLICTRS
The success and viability of any community rests on certain fundamental values. Foremost
amongthese values is the assurance of a life sustaining municipal water supply. It is, therefore,
incumbent upon the elected officials of the community to implement a water utility policy that
ensuresp resent and future availability and delivery of quality water through responsible
management of water resources.
With_the_acquisitionof._the Town'_s municipal water systems, the Town_Council established the
Oro Valley Water Utility as a financially self-supporting enterprise. The Town Council has also
provided guidelines for water Utility management and operation through promulgation of the Town of Oro Valley Mayor and Council Water Policies (M&C Water Policies).
In recognition of water management issues such as increasing demand with population growth,
annual diminishing of groundwater supplies, the need to meet local, state and federal water
qualitystandards, along with economic and environmental factors, the M&C Water Policies
reflect and support measures necessary to protect, sustain, enhance, augment and finance
affordable water supplies for present and future Town of Oro Valley water consumers.
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I. ASSUMPTIONS
A. The Oro Valley Water Utility is established as a financially self-supporting enterprise.
B. All financing shall be done in accordance with all town, state and federal requirements.
C. Sustainable and reliable water supplies shall be maintained for the Oro Valley Water
Utility-Service TArea.. -
D. Q y ualit of water delivered by the water utility, both potable and non-potable, shall meet
town, state and federal standards for the purpose for which it is intended.
E. Annual and long-term water rate design and distribution of water utility revenues shall
include costs of utilization of alternative water sources and savings achieved through
system-wide water conservation.
F. To the extent that conservation programs succeed in reducing demand; capital
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improvement programs may be deferred and rate increases adjusted accordingly.
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II. POLICIES
A. Finance
1. Enterprise Basis
a. The Utility shall be a financially self-supporting enterprise with all costs associated
with operation of the Utility to be funded from revenues derived from the sale of
water and other water-related income sources.
--- - b. An annual average debt service coverage of 1.3 times or 130% shall be maintained.
c. Water revenues collected in excess of operating needs of the Utility shall be carried
forward for future operating or future bond funding requirements and shall not be
transferred to the Town's General Fund.
d. The Utility shall maintain cash reserves for known future .obligations plus an
allowance for unbudgeted contingencies set at 5 percent (5%) of the total annual
budget.
e. Should the Mayor and Council determine the need for a minimum amount of water at
reduced rates or other forms of subsidized water service for low income water users
within the service area, the costs of such subsidies will be funded from the Town's •
General Fund and not from water rates, fees and charges.
f. The Town shall not enter into a development agreement for any purpose that permits
the developer to pay reduced water rates and/or reduced development impact fees.
2. Water Rates and Charges
a. Cost-of-Service Basis
(1) Insofar as possible, charges for potable water shall be made on a cost-of-service
basis.
(2) Marginal cost factors of the Utility will be continually studied by staff and
considered in the setting of rates.
(3) The substitution of reclaimed water for non-potable uses is an important element
in future achievement of safe yield in the TAMA. Rate setting for reclaimed
water shall be in accordance with the following precepts:
(a) Charges for reclaimed water shall be based on the cost-of-service whenever
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possible.
(b) To the extent that charges for reclaimed water based on cost-of-service do not
provide adequate price incentive, the price of reclaimed water shall be based
on a market value which encourages its use.
(c) The Commission shall review and make recommendations and the Mayor and
Council shall hold a duly advertised public hearing prior to entering into any
agreement to sell reclaimed water to any customer at a rate other than that rate
established by resolution.
(4) In the event the Town enters into contract with other water providers for delivery
of CAP allocations, the Town shall negotiate the costs with the providing supplier
to achieve the most reasonable and competitive price.
(5) Insofar as possible, charges for CAP water shall be made on a cost-of-service
basis.
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b. Water Rate Design Elements
(1) Commodity charges shall reflect the costs of service across customer classes.
(2) Customers shall be charged for fixed and recurring costs of service such as:
(a) new connections;
(b) re-connections;
(c) meter reading; and
(d)
(3) Rate structures shall be designed so as to encourage water conservation.
(4) Water rates and charges shall be reviewed annually and changes in the rate
structure shall be implemented so as to avoid sudden and large-scale shifts in
water rates.
(5) Water rates for retail customers inside and outside the Town limits shall be the
same within each customerr class unless there is reasonable justification based on
cost-of-service rate differentials.
3. System Development Requirements
a. The Town Council shall adopt both potable and non-potable water system master
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plans that will identify standard levels of service and the capital improvements that
will be required to achieve and maintain those levels of service. Upon adoption of
water system master plans, the Utility shall assure that no extension, improvement or
addition to the water systems or facilities over which the Town has jurisdiction shall
be constructed or authorized unless the extension, improvement or addition has been
determined to essentially conform to said potable or non-potable water system master
plan.
b. All costs of water system facilities necessary to serve a new applicant shall be paid by
that applicant.
c. Agreements may be executed which contain provisions to refund to an applicant that
portion of the costs not directly attributable to a new development, such as the cost
differential of anyoversizingof mains beyond what is required for the applicant. The
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source of funds for such refunds may be from the Utility or from properties described
in Section 3.d.
d. System extensions, improvements or additions for properties not financially
participating in construction of certain Oro Valley Water facilities shall be assessed a
charge upon connection to the Oro Valley Water Utility system. Funds collected for
reimbursement may be reimbursed through the Utility to the party or parties that
financed the original facility construction.
4. Service Area Expansion
a. The Town shall not expand its water utility service area into areas not presently
served by other water providers unless prior consideration of the following indicates
acceptable and equitable circumstances consistent with this policy:
(1) Costs t6 existing ratepayers;
(2) Operations and maintenance costs of system being acquired;
(3) Water supply factors;
(4) Regional plans; and
(5) Annexation issues
5. Capital Improvements
a. Various combinations of revenue bonds, general obligation bonds, tax-secured bonds,
water revenues and other types of legal debt instruments may be used to finance
capital improvements.
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b. Repayment g of long-term debt shall be made from water system revenues. Long-term
debt incurred for capital improvements to meet growth related demands shall be
repaid with development impact fees.
c. The type of financing to be used shall result in the least total cost to ratepayers based
on present value.
d. The term of repayment of debt shall not exceed the useful life of the improvement
funded by such debt.
e. q re Capital requirements for relocations or other modifications to the water system
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required-to accommodate other public works shall be derived from sources other than
the water utility.
B. Acquisitions
1. System Acquisitions
Valley shall strive to become the sole retail water provider within
a. The Town of Oro 11 y
its corporate boundaries. If the Town expands its boundaries- into areas currently
� - providers, negotiate with those
receiving water service from other water it may g
entities to obtain the right to become the retail provider.
b. The Town maypurchase other water delivery systems adjacent to or near the Utility's
service area if such purchase is beneficial to the customers of the Utility. Delivery
systems that are considered for purchase by the Town should:
(1) Possess water resources that have a positive and significant effect on water
quality, availability and supply; and
(2) Not increase the cost of providing water to existing customers of the Utility.
c. Expansion of the water utility service area shall include consideration of the potable
and non-potable water system master plans, regional water resource management
plans, and coordination with other jurisdictions when appropriate.
d. The Water Utility Commission shall review potential water system acquisitions and
make recommendations to the Town Council.
a negotiate ownershipof parcels of real property within the Town
e. The Town may g
boundaries that may have been acquired by another jurisdiction for its water utility
prior to the time the Town became its own water provider. Assessment of value of
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real property shall be by fair market value or other method of assessment of value as
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may be appropriate.
f. The Town may negotiate ownership and control of existing water service facilities
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within its designated service area that are not currently owned by the Town.
Assessed value of such facilities shall be by fair market value or other method of
assessment of value as may be appropriate.
g. Whenever the Utility supplies any source of water to another water provider, the
contract or agreement governing this transaction shall encourage the water provider to
implement a program that includes conservation incentives.
2. Water Rights Acquisitions & Sales
a. The Town may purchase, sell and/or lease grandfathered water rights, CAP water
�� --- rights or stored water credits when the Mayor-and-Council determine-the transaction
is consistent with short and long term goals and policies of the Town.
b. Water rights and stored water credits may be considered inrice negotiations for
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reclaimed water and CAP water.
C. Water Resource Management -
1. Service Area Management
a. The Utility shall maintain a 100-year assured water supply in accordance with
ADWR assured water supply rules.
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b. The Town shall continue to participate in TAMA-wide groundwater management
through coordination and cooperation among water users, water providers and
governmental agencies.
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c. The Town shall continue to work cooperatively with adjacent water providers and
appropriate governmental agencies to implement feasible and practical alternatives
for utilization of CAP water within the Town and the TAMA. The Town shall
include costs for such activities In the utility's annual-budget. ��� -
d. In cooperation with other water providers, the Utility shall strive to establish a fair
share cost distribution among ratepayers of the region for planning and
implementation of regional use of renewable water resources such as CAP water and
reclaimed water.
e. The Town may seek and support legislation which recognizes that additional funding --
sources may be required for utilization of CAP water in areas more remote from the
CAP canal.
2. Water Quality
a. The Utility shall provide all customers water which is safe and which meets or
surpasses all federal and state primary drinking water standards, including that all
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water shall:
(1) contain no substance naturally occurring or man-made in amounts that exceed the
primary maximum contaminant level pursuant to the Federal Safe Drinking Water
Act, the ADEQ or the Arizona Department of Health Services;
(2) meet local standards to protect health and safety in the absence of federal or state
standards;
(3) be tested for contaminants at representative locations throughout the distribution
system as appropriate and as required by regulatory agencies to avert possible
-- - health, economic, or environmental threats.
b. The Utility shall cooperate with applicable regulatory agencies to assure that water
treatment provides safe water that meets or exceeds all federal and state standards.
c. All non-potable water use shall be consistent with ADEQ regulations.
d. The Utility shall be responsive and responsible to concerns regarding water quality
and will provide the public with timely and accurate information on matters relating
to water quality issues.
e. The Utility will fund remediation of groundwater contamination commensurate with
its responsibility for the problem.
3. Contingency plans
a. The Utility shall develop and maintain an emergency response plan to manage a
water loss, shortage, delivery interruption, contamination, or other water emergency.
Emergency conservation measures shall focus on the reduction or elimination of
_-� water_intensiveuses that do not affectpublichealth or safety.------ _____
b. Emergency water supplies may be provided to adjacent water providers subject to the
Utility's ability to meet the demands of its customers.
4. Non-potable water
a. Priority shall be given to the development of delivery systems for non-potable water,
-
such as CAP water and reclaimed water.
b. Criteria shall be established whereby the use of non-potable water shall be required
for landscape irrigation and industrial uses.
c. The Utility shall evaluate options for the use of reclaimed water generated within its
water
service area as a major source of groundwater conservation. Evaluation of such
- 7 -
options shall include cost benefit analyses for capital project expenditures and
facilities operation and maintenance.
(1) The Town shall be a principal in negotiation of any transaction resulting in the
proposed use of reclaimed water within the Oro Valley Water Utility designated
water service area.
(2) The delivery of reclaimed water within the Oro Valley Water Utility service area
may be accomplished all or in part by an IGA.
(3) The potential for using renewable water resources, including reclaimed water,
shall be evaluated for inclusion in all new water service area and land use plans.
The Utility shall work with new and existing large water users, including but not
limited to golf courses, parks, schools, industrial, multi-family complexes and
homeowner associations to provide practical and economical delivery of
renewable water supplies.
(4) All new turf facilities and golf course development shall use reclaimed water for
irrigation purposes.
(5) Any conditions for interim use of potable water shall be made part of water
service agreements and other appropriate contracts to assure prompt action
converting to the maximum use of renewable water sources, including reclaimed
water, for irrigation purposes. Such conditions shall include, but not be
rPlimited
to, the dates for having the system in place, requirements for financial
participation by the developer in construction, penalties for non-compliance and
requirements for alternative water resources development fees in addition to the
regular rates and charges.
(6) When private—development requires reclaimed water service in advance-of the -
J
Town's construction schedule, developers shall work with the Utility to formulate
a plan of service to be implemented at the sole expense of the developer with
facilities to be dedicated to Oro Valley Water Utility upon completion.
(7) The Utility shall review all new developments and propose dedication of specific
sites and easements for both the potable and non-potable water delivery systems.
(8) The Utility shall participate with other jurisdictions, water providers and agencies
of local, state and federal governments and others in developing regional
renewable water supply delivery systems for irrigation of major turf areas and for
potential groundwater recharge.
•
w -
5. Support of Riparian Areas
a. The streams and washes in the Oro Valley Water Utility Service Area are classified as
ephemeral or intermittent. As such, they support certain naturally occurring riparian
desert vegetation. New well locations or other water utility construction in these
b
riparian areas shall be executed with minimum disturbance.
b. Any new riparian areas that may be established by any activity of the Oro Valley
Water Utility shall be passive in nature to enhance the existing natural vegetation and
_----------- wildlife and not-for purposes of-introducing species that may exist naturally in other
areas.
6. Recharge
a. The Town will only participate in artificial recharge projects that are consistent with
the water management goals of the State and the Town. -
b. The Utility shall participate with the jurisdictions, water providers and other agencies
physicallyfinancially
icall and in site-specific investigations for potential recharge
locations. The Town shall include costs for such activities in the utility's annual
budget.
D. Conservation
e conservation is an important factor in achieving and maintaining a sustainable
1. Water p
water supply.1 . Conservation program elements such as public information and education,
incentives, ordinances and coordination with regional programs will be developed and
implemented to achieve conservation goals. Such programs may include:
a. Public information and education: may provide publications, public seminars,
speaking engagements, and residential consultations on conservation related topics.
b. Incentives: may include reduced or waived building permit fees for installation of
water
conservation devices; the sale of water saving devices at a reduced price;
training for service and maintenance providers; and design, maintenance and water
management consultations for commercial and private irrigation issues.
c. Professional associations: the Town may maintain membership with and continue its
support of national and regional professional associations whose objective is the
responsible and practical use of municipal water resources.
d. Training and education for Town employees: the Town will continue to promote
- 9 -
' r
participation by its employees in trainingand educational� n 1 opportunitles that will
ensure a high level of professional expertise, competence and service to its customers.
stomers.
E. Water Infrastructure Security
1. The Utility shall take all necessary actions to comply with the Public Health Security and
Bioterrorism Preparedness and Response Act enacted bythe Federal Government.
ent.
a. Where practical, corrective actions shall be taken to mitigate security deficiencies.
g y
F. Policy Review Process
1. Policies review
a.
Mayor and Council policies shall be reviewed for amendments bythe Water Utility
U pity
Commission and/or as directed by the Council.
•
•
. 1
- 10-
TOWN OF ORO VALLEY 2
Page 1 of 2
COUNCIL COMMUNICATION STUDY SESSION 06/11/08
TO: HONORABLE MAYOR AND COUNCIL
FROM: Philip C. Saletta, P.E., Water Utility Director
SUBJECT: ALTERNATIVE WATER RESOURCES DEVELOPMENT IMPACT FEE
SUMMARY:
On May 7, 2008 the Council approved a Notice of Intent to increase the Alternative Water Resources
Development Impact Fees (AWRDIF). This was a combined NOI that was done in conjunction with other
proposed Town Impact Fees.
In 2007, Council approved an increase to the AWRDIF with a 5 increment phase-in. This incremental
increase approach was based upon negotiations with the homebuilders and developers. Senate Bill 1406 in
the State Legislature proposes to allow for the payment of development fees based upon the amount of the fee
at the time of plat approval and that no increased fees could be charged for 24 months after that plat approval.
This bill impacts the ability of the Water Utility to collect the incrementally increased amount for up to 24
months based upon the interpretation by Legal Counsel.
This legislation if passed has fiscal impact on the ability of the Water Utility to collect the AWRDIF that is in
place at the time the meter is sold. This reduces revenues to the Water Utility to pay for the development of
renewable water resources. This twenty-four month waiting period would be applied to any new fees that
become effective after January 1, 2009 and has the potential to cause both administrative and budgetary
consequences. The purpose of the impact fees is to assure that growth pays its proportional share of water
resource and infrastructure need for new water supply.
The Notice of Intent that Council approved on May 7th proposes to increase the amount to the full fee with no
incremental increase. Attached is the current AWRDIF with the incremental phase-in. Also attached are the
proposed fees as contemplated in the report submitted to Council with the Notice of Intent.
The Water Utility Director will present to Council a review of the fees and their purpose and an overview of
the proposed draft ordinance to increase the AWRDIF. An overview of the renewable water resources
projects will also be discussed. This will include the Reclaimed Water Project and the future development of
the Town's allocation of Central Arizona Project Water.
The proposed schedule for the increase in the AWRDIF is as follows:
July 16, 2008 Public Hearing
September 3, 2008 Request for Adoption
December 2, 2008 Increased AWRDIF in effect
TOWN OF ORO VALLEY
Page 2 of 2
COUNCIL COMMUNICATION STUDY SESSION 06/11/08
This AWRDIF coincides with the proposed schedule of the other Town impact fees proposed for approval by
Council.
ATTACHMENTS:
1. Current Alternative Water Resources Development Impact Fees- Town Code-Water Code 15-17-4
2. Proposed Alternative Water Resources Development Impact Fees
Staff also suggests that Council bring their Water Utility Impact Fee Study and Infrastructure Improvements
Plan—Alternative Water Resources Development Impact Fees Report to the Study Session for reference.
ez.
r 66.„6
Philip C. aletta, P.E. Water Utility Director
aft4.;
David Andrews, Town Manager
15-17-4 Alt
ernative Water Resources Development Impact Fees ,
AWRDIF AWRDIF
gWWA AWRDIFAWRDIF AWRDIFffective
Meter
Effective Effective Effective Effective E
Capacity 9/19/2007 9/19/2008 9/19/2009 9/19/2010 9/19/2011
Ratio
Single-
Family
Residential
Demand 1.0
1.0 1.0 1.0 1.0
Adjustment
Factor -
$3,240 $4,210 $5,182
5/8-inch 1 $1,300 $2,270
3/4-inch 1.5 $1,950 $3,400 $4,860 $6,320 $7,770
1-inch 2.5 $3,250 $5,680 $8,100 $10,530 $12,960
1 1/2-inch 5 $6,500 $11,350 $16,200 $21,050 $25,910
$18160 $25,920 $33,680 $41,462-inch 8 $10,400 Multifamily
Residential
(Per Unit)
Demand NA 0.48 0.48 0.48 0.48 0.48
Adjustment
Factor
Per Unit NA $625 $1,090 $1,555 $2,020 $2,490
Commercial
and Industrial
Demand
1.0 1.0 1.0 1.0 1.0
Adjustment
Factor _
5/8-inch 1 $1,300 $2,270 $3,240 $4,210 $5,182
3/4-inch 1.5 $1,950 $3,400 $4,860 $6,320 $7,770
1-inch 2.5 $3,250 $5,680 $8,100 $10,530 $12,960
1 1/2-inch 5 $6,500 $11,350 $16,200 $21,050 $25,910
-
$18160 $25,920 $33,680 $41,460
2-inch 8 $10,400
$36320 $51,840 $67,360 $82,910
3-inch 16 $20,800
4-inch 25 $32,500 $56,750 $81,000 $105,250 $129,550
6-inch 50 $65,000 $113,500 $ $210,500 $259,100
8-inch 80 $104,000 $181,600 $259,200 $336,800 $414,560
1
Irrigation
Nonturf
Demand
1.0 1.0 1.0 1.0 1.0
Adjustment
Factor
$2,2705/8-inch 1 $1,300 $3,240 $4,210 $5,182
3/4-inch 1.5 $1,950 $ $4,860 $6,320 $7,770
M
1-inch 2.5 $3,250 $5,680 $8,100 $10,530 $12,960
1 1/2-inch 5 $6,500 $11,350 $16,200 $21,050 $25,910
2-inch 8 $10,400 $18,160 $25,920 $33,680 $41,460
3-inch 16 $20,800 $36,320 $51,840 $67,360 $82,910
4-inch 25 $32,500 $56,750 $81,000 $105,250 $129,550
6-inch 50 $65,000 $113,500 $162,000 $210,500 $259,100
8-inch 80 $104,000 $181,600 $259,200 $336,800 $414,560
Turf Uses
(Per Acre)
All Turf NA $13,900 $24,900 $35,900 $46,900 $58,000
Uses - Per
Acre
A variance may be requested if a meter is required to be increased from a five-eighths
(5/8) inch meter to a three-quarter (3/4) inch meter solely due to the installation of fire
sprinkler systems. If the variance is granted, the AWRDIF that will be assessed will be the
cost of a five-eighths (5/8) inch meter. The variance will have no impact on all other rates,
fees and/or charges associated with a three-quarter (3/4) inch water meter.
(07-32, Amended, 06/20/2007; 96-43, Enacted, 01/08/1997)
EY Town of Oro Valley Water Utility
Alternative Water Resources Development Impact Fee Analysis
Table ES-1
Proposed 2008 AWRDIF
Proposed
Single Family Residential (per meter size)
2008 AWRDIF
%-inch $4,982
3/4-inch 7,470
1-inch 12,450
1%-inch 24,910
2-inch 39,850
Multifamily (per unit) Proposed
Per unit $2,390
Commercial and Industrial (per meter size) Proposed
%-inch $4,982
3h-inch 7,470
1-inch 12,450
1%-inch 24,910
2-inch 39,850
3-inch 79,710
4-inch 124,550
6-inch 249,100
8-inch 398,560
Irrigation (non turf) (per meter size) Proposed
9
%
-inch $4,982
3/-inch 7,470
1-inch 12,450
1%-inch 24,910
2-inch 39,850
3-inch 79,710
4-inch 124,550
6-inch 249,100
8-inch 398,560
Turf Uses (per acre) Proposed
Golf Course Turf/All turf uses (proposed)
Lakes and Open Water $55,800
Cemeteries, Parks and Schools
J
Other Uses
8
April 2008 Page v : #.:r; RED),A,k CONSU I_Ti NG
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