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HomeMy WebLinkAbout2020-07-09 BOWC MINA BOARD OF WATER ■ 1 COMMISSIONERS ty MEETING MINUTES THURSDAY, JULY 9 2020 (VIA ZOOM - DUE TO COVID-19) 204 Third Street N Stillwater, MN 55082 651-439-6231 President Speedling called the meeting to order at 8:00 a.m. Present: Commissioners Vania, Commissioner Jensen (joined the meeting at 8:50 a.m.) President Speedling and Councilmember Polehna Absent: None Staff Present: Board Manager Benson Supervisor of Distribution Tibbetts APPROVAL OF AGENDA Motion by President Speedling, seconded by Commissioner Vania to approve the agenda as presented. All in favor. APPROVAL OF BOARD MEETING MINUTES Motion by President Speedling, seconded by Commissioner Jensen to approve the June 11, 2020 minutes with the removal on Page 6 of 6 the presentation to the City Council on the rate increase on July 7th. All in favor. APPROVAL RESOLUTION NO. 1545, DIRECTING PAYMENT OF BILLS Mr. Benson noted that the mailing cost from the Safe Water Commission was reduced because they sent out postcards rather than a letter. Motion by President Speedling, seconded by Commissioner Vania to adopt Resolution 1545, directing payment of bills. All in favor. SUPERVISOR OF DISTRIBUTION REPORT Supervisor of Distribution Tibbetts stated that the department has been working on street construction projects in the Greeley, Linden, and William Streets area and there were no issues. The next area for the projects is the 4th Street area and he reported that they will be addressing three service lines because they are abandoned and want to get them shut off to prevent issues. He stated that general maintenance is being done along with adjusting high/low hydrants. Commissioner Vania inquired about Neal Avenue North. Mr. Tibbetts stated that the department does not have anything in that area and that the project is more to get rid of the ditches in the area with storm sewer etc. There may be a watermain tie-in at Boutwell, but probably not until next year. Board of Water Commissioners July 9, 2020 Councilmember Polehna inquired about replacement of hydrants on Rice/Owens. Mr. Tibbetts responded that the replacement would happen with the County project, that has been delayed until next year. The Fire Department is aware and alright with the delay. No work is happening on the Croixwood projects. DELAY CONNECTION TO CITY WATER SYSTEM - DALE & JENNIFER SHALLER Mr. Benson explained that Dale & Jennifer Shaller are requesting a variance to the ordinance relating to immediate hookup to City water. He stated that the water service has been installed and Shallers have hooked up to sanitary sewer, but wants to continue to use their well. Mr. Dale Shaller 1819 4th Street North, informed the Board that their current well is operational and has been tested by Washington County several times. He stated that the reason they would like to delay the hookup is because they like their well water. The well was built in 1976 and was concerned about hooking up to treated water. He stated that he realizes that the sanitary sewer charge is based on the water use and is willing to put a meter on the well to monitor how much water is being used and placed into the sewer system. He also questioned why it is necessary to hookup to City water when the well is operational. Mr. Benson explained to Mr. Shaller that the City and the Water Department have paid for the infrastructure in front of the house and the ordinance and Board resolution requires hookup when either sewer or water has been hooked up or upon the sale of the property. Commissioner Vania asked Mr. Shaller if he compared the Washington County test to the Water Report. Mr. Shaller stated that he did not, but that there are other items such as chlorine, fluoride or other disinfected etc. that his well water does not have. Mr. Benson and Commissioner Vania explained that Bacteriological testing of the water occurs bi-weekly and daily for fluoride Chlorine. He stated that the State requires the addition of chlorine and fluoride for public health. Mr. Shaller inquired how the water pressure is maintained and will it be comparable to what they have now and use of a water softener. Mr. Benson explained that water pressure is maintained through the height of the water towers and in Mr. Shaller's area it should be adequate, however if the pressure is too high a pressure reducing valve would have to be added. Mr. Benson continued by stating that a water softener could still be used and depending upon the company an option that could be done is to remove the chlorine and fluoride through the softener. He also explained that with modification of plumbing, the current well could be used for outside use as that water would not be going through the sanitary sewer system. Mr. Shaller asked if the Board has approved variances before because Ms. Shilts, Building Official, told him that there are some residents that have a meter on their sanitary sewer. Mr. Benson stated that those instances they did not have water available to the property only the sewer. He is not aware of variance requests being approved. Mr. Shaller explained that the reason they hooked up to the sanitary sewer was that their septic system was not up to code and environmentally it was the right thing to do. Page 2 of 8 Board of Water Commissioners July 9, 2020 Supervisor Tibbetts felt that 2 meters could be installed but it is the Board's decision. President Speedling asked how the billing would work. Mr. Benson explained that even though it could be done it goes against the Board's resolution and City's ordinance for hookup requirements. He also stated that a minimum charge would be on each of the 2 meters, but that he does not know if the City would allow 2 meters on one property and have an extra minimum charge for the sewer. Mr. Shaller stated that he is willing to pay for the extra meter and minimum costs for the extra water meter. President Speedling suggested that Mr. Benson contact the City and see if they would allow this type of an arrangement. Mr. Shaller felt that this compromise would be beneficial to all parties involved and mentioned that he has been paying a sewer bill for a long time. Councilmember Polehna stated that the minimum charge was implemented to residents who did not want to hook up to the sewer. Commissioner Vania stated that it was not a rate charge, but a charge for the capital infrastructure. Commissioner Vania requested that Mr. Shaller get the complete cost for the 2 meters from Mr. Benson and the City. Mr. Benson stated that he will contact the City on this issue, but he is not aware that this has been done in the past. Mr. Benson will bring the information back to the Board at their next meeting, August 13, 2010 at 8:00 a.m. He will talk to the Public Works Director to see if he wants to attend the next meeting. UTILITY REPAIRS QUOTE FORM Mr. Benson provided the Board with an updated utility repairs quote form for approval. Commissioner Vania suggested that there be a minimum crew of five (5). He also would like to see clarification regarding written contract access to a gravel pit. Councilmember Polehna felt that the sentence regarding traffic control should include all streets and read "Traffic control streets shall be designed and installed in accordance with Minnesota Manual on Uniform Traffic Control Devices." Commissioner Jensen joined the meeting. Supervisor Tibbetts left the meeting. Mr. Benson will make the updates, send electronically to the Board, and proceed with the acquisition of quotes. WELL NO. 9 - MATT ELLINGSON, T.K.D.A. Mr. Matt Ellison, T.K.D.A. reviewed five bids for the Well No. 9 Generator project were received on June 23, 2020. He stated that Municipal Builders Inc. was the apparent low bidder with a bid of $384,295. He stated that the low bidder is a well -qualified contractor and that he has worked with them on several projects. Therefore, he recommends the Board award the contract to the lowest bidder, Municipal Builders Inc., for their bid of $384,295. The engineer's estimate was $322,000. He provided information that the Page 3 of 8 Board of Water Commissioners July 9, 2020 higher bids received for the project reflect a continuing trend on projects where the bids received reflect much higher construction costs for 2020 projects due to multiple factors including the current pandemic. He did not feel that bids would decrease in the future because contractors are keeping busy and does not see that changing in the future. He continued by stating that this project is a necessity to improve the reliability and capacity of the Board's water supply by providing emergency back-up power that can feed the system in the event of a power outage. There was a consensus on the cost increase and asked what the original cost was. Mr. Ellison indicated that they underestimated the cost. Mr. Ellison explained that originally it was going to be a generator located outside on a cement slab, then the cost was increased to $227,000 for a larger building and sound proofing because of its location to the health club. Commissioner Vania stated that they are tight bids. Mr. Ellison responded that he felt they were good bids, but that they underestimated the cost. Commissioner Jensen felt some uneasiness on the project because the costs seemed to keep going up, first engineering costs, now construction costs. She wants to make sure the money is there and that the Board is comfortable with the increased costs. She views the project as important in case of a power outage. President Speedling agreed with Commissioner Vania on the bids. He does acknowledge that the extra comes out of the capital fund. Commissioner Jensen asked who provides the oversight on the project. Mr. Benson responded that T.K.D.A is contracted to provide that service. She wants Mr. Ellison and T.K.D.A. to hold the line on the bid. Mr. Ellison agreed and explained that during the construction there may be ways to decrease costs. Mr. Benson stated that approximately $130,000 would have to be pulled out of the capital reserves. Commissioner Vania asked what projects could be postponed to next year. Mr. Benson stated that because of the pandemic the $40,000 (carry-over $20,000) hydrant painting will not be completed along with $10,000 for cupola and office painting and $20,000 for well house maintenance. The PRV project came in less. Motion by Commissioner Vania, seconded by President Speedling to accept the bids and awarding the contract to Municipal Builders Inc. in the amount of $384,295 with the above projects not to be done in 2020. All in favor. SAFE WATER COMMISSION Mr. Benson provided an update on the smart controllers by stating that the postcards were sent and that they anticipate 50 installations in July with the 100 by mid -August. He reviewed the commission spreadsheet showing installation etc. He stated that there are 37 smart controllers left. Commissioner Jensen asked that information be brought back for future discussion if there are still smart controllers left. He stated that he received information that there has been 125,000 gallons of savings so far on six installed. Page 4 of 8 Board of Water Commissioners July 9, 2020 2020 RATE STUDY - CHRIS KNOPIK, CLIFTONLARSONALLEN (CLA) Chris Knopik, CliftonLarsonAllen (CLA) provided a presentation to the Board that was based on Scenario 2 which would be a flat rate with residents paying 100% of the usage with four tiers with a break even at 3, 5, and 7-8 years. He stated that his goal was to provide insights and analysis on the following scenarios considering capital projects, rate increases, and rate structure changes and the information used was information provided by Mr. Benson and were used to support this analysis, December 31, 2019 financial statements, statements of income and they also assembled abbreviated projected statements of cash flows and balance sheets are for a prospective period covering the years ending December 30, 2019 through 2023. Mr. Knopik stated that the strategies used were to evaluate and establish baseline performance; establish baseline assumptions for current operations (volumes / "sizing", changes in residential and commercial rates; staff and other expense assumptions (cost of living and "variable" expenses related to changes in volumes); routine and major capital projects). Also looking at the creation of customized interactive long-range financial planning dashboard incorporating key assumptions and utilize the interactive model to create scenarios, evaluate sensitivities of various options and establish "most likely" financial projection. Mr. Knopik stated that 50% users within Stillwater never crossed the minimum threshold in the residential billing system. Commercial users should be increased by a percentage. On a question from Commissioner Jensen, Mr. Benson stated most of the multi -family were setup under residential and were set up prior to his employment. He understood that it was setup this way because the usage was not there under commercial rates. Commissioner Jensen stated she is concerned that multi -family rates will increase affecting the lower income residents and she wants to be careful of that. Commissioner Jensen asked that the slide include the statement rates compared to Stillwater are current rates and costs per quarter. Mr. Knopik reviewed the peer cities rates and Stillwater rates. He reminded the Board that peer cities may have their own issues that affect their rates. He also stated that he recommended an annual rate increase should cover inflation (approximately 4% increases) and felt the scenarios should show that inflation. He stated that the scenarios also included the test fees and are listed as a per quarter cost. Mr. Knopik continued by describing Scenario 1 with breakeven 3 years that Includes a tiered structure with an $10/per customer flat fee. while also having cash reserves for the water tower painting in 2023 - quarter cost $49.28 (17% increase) President Speedling asked how many residents have high uses. Mr. Knopik stated he could provide those numbers to the Board. Mr. Benson expressed concern that residents, (homeowner associations) with stand-alone irrigation systems may be residential and fall into the higher tier. Page 5 of 8 Board of Water Commissioners July 9, 2020 Commissioner Vania felt that Scenario 1 was a responsible decision. Mr. Knopik stated that Scenario #1 is the most aggressive way to maintain reserves for water tower painting without trying to do it all in one year. Councilmember Polehna asked what the City did when they raised sanitary sewer rates. Mr. Knopik stated he did not have specific information, but he thought the breakeven point was 2 years which is more aggressive. Councilmember Polehna stated he has not received comments on that increase. He stated that the City passes on the Met Council increase. Commissioner Jensen wanted to clarify that more water is going to the treatment plant from Stillwater than other cities and that by conserving water means less water going to the treatment plant. Mr. Benson explained that the water tower painting in 2023 is not set in stone, but it was used as a base for discussions as it is one of the bigger projects. Mr. Knopik reviewed Scenario 2 which includes a tiered structure with an Sniper customer flat fee while also having cash reserves for the water tower painting in 2023- quarter cost $48.35 (15% increase). Mr. Knopik continued with Scenario 3 which had breakeven in 7 years that includes a tiered structure with an $9/per customer flat fee and increasing the tier breaks. The goal is to breakeven within 8 years while also having cash reserves for the water tower painting in 2023 - quarter cost $44.20 (5%). This would result in 16 days of reserves at year end after paying for the water tower painting project. Commissioner Vania would like to see 3-5-year breakeven point and 10-12%. President Speedling stated that Stillwater is under market compared to surrounding cities and preferred Scenario 1. Commissioner Jensen agreed if the communications piece is done well to explain the reasoning behind the increase. Mr. Knopik informed the Board that the last rate increase was in 2015. President Speedling indicated that needs to be part of the education communication and other things that have been done as well. Commissioner Vania stated even with Scenario 1, they still would be lower than any peer cities. Commissioner Jensen would like to see the graph of peer cities include the option the Board decides. Mr. Knopik agreed and will prepare that for the City Council presentation. He continued by stating his opinion is that the rate allows for an increase of 5% in future years. On a question from Mr. Benson on larger users, Mr. Knopik stated he could create a scenario crossing tiers (50,000-gal, 75,000 gal) what the average bill would be. He asked to run a report on how many 50,000 -100,000 users there are. Mr. Knopik stated he would like to vet some larger users with Mr. Benson prior to the meeting. Commissioner Jensen stated that would be a good education piece for the large users to change their irrigation systems. Page 6 of 8 Board of Water Commissioners July 9, 2020 Commissioner Vania requested that Mr. Knopik put together the costs for this project for the next meeting because the Board knows it is beyond the scope of services. Commissioner Jensen requested information on annual increases of 5% and 6% over 3 years based on Scenario #1 It was the consensus of the Board to bring the rate study back at the August 13th regular meeting and approve the rate for presentation to the City Council on September 1st. COMMUNITY EDUCATION (INFOGRAPHIC) AND WEBSITE COMMISSIONER JENSEN Commissioner Jensen stated that she will bring the information to the next meeting. President Speedling suggested that an educational flyer be given by staff to those businesses who irrigate in the rain. Mr. Benson stated that a flyer could be prepared. BEEHIVE/GIS REPORT - SCOTT JANNI, BOLTON & MENK Mr. Benson explained the processes between staff in BeeHive and Bolton & Menk for GIS. He stated that staff can make changes to the maps in BeeHive and then a file is sent to Bolton & Menk where they make the adjustments and send it back and it is uploaded into BeeHive. He stated that Commissioner Vania is concerned about keeping the data clean. Mr. Scott Janni, Bolton & Menk, stated he has talked with Jim Kruger of BeeHive and explained that a couple different ways to get the information to GIS and BeeHive. He stated that Bolton & Menk is not hosting the data therefore they do not have each change right away, but when it is new infrastructure, they would need it. He did mention Mr. Kruger indicated that Bolton & Menk could have direct access to BeeHive just like the water department does. Mr. Benson stated that procedures on edits etc. should be done. He stated that Bolton & Menk are only collecting new or replacement features and should not be a problem. Commissioner Vania expressed concern on the quality control of the database. Mr. Janni explained that BeeHive database is hosted by BeeHive. Commissioner Vania felt that BeeHive is not a GIS operation and he is not comfortable with them managing the database. Mr. Janni explained that staff is updating is the BeeHive GIS database, therefore the only time they would need information is when there is new or replacement information which is based on unique identifiers and based on those identifiers they can track of who changes and when it was changed. Mr. Benson stated that staff can make changes. Mr. Janni stated that water department can make attribute and geometry changes and BeeHive is limited on what they can do. Mr. Janni explained that direct access to BeeHive would work. Commissioner Vania wants Bolton & Menk to keep the database clean annually. Mr. Janni agreed that staff can make attribute changes and they could create the new or replacement assets. Commissioner Vania stated that until there is a certified GIS person on staff, he would like Bolton and Menk to be the ones adding and replacing assets. Give Bolton & Menk direct access to BeeHive. Any asset changes would have to be done by Bolton & Menk. If it is an immediate change have the City's staff GPS the change. Commissioner Vania asked for a time and materials charge for tying into the BeeHive system and write up a process for this information. Information may be available at the next meeting. Page 7 of 8 Board of Water Commissioners July 9, 2020 NEXT MEETING DATE Next regular meeting is Thursday, August 13, 2020 at 8:00 a.m. ADJOURNMENT Motion by President Speedling, seconded by Commissioner Vania to adjourn at 11:18 a.m. All in favor. ATTEST: /\ Robert G. Benson, Board Manager Steve SpeedliPresident Page 8 of 8