HomeMy WebLinkAbout01-14-2014 CCM
Lake Elmo City Council Water System Funding Workshop
Tuesday, January 14, 2013
6:30 PM MINUTES
Mayor Pearson called the meeting to order at 6:30pm
Present: Mayor Pearson, Nelson, Bloyer, Reeves, and Smith arrived at 6:35pm.
Also present: Zuleger, Bendel, and Bell I. Call to Order Mike Pearson, Mayor 6:30 PM
II. Pledge of Allegiance Zuleger gave overview of what the workshop would entail and explained the objectives
• Provide clean potable water to residents
• Cash flow both from a debt service and operation and maintenance perspective / funding
sources
• Accommodate growth and groundwater limits.
III. Water System Needs 6:35 PM
A. Trunk Water System Infrastructure Needs Jack Griffin, Focus 6:35 PM
Griffin gave overview of the current water system and the projects included in the 2014-2018 CIP. The need for replacing the village piping was discussed. Reasons given were size of pipe and age/quality.
Reeves asked about how many residents would have access when the system is complete. Griffin
stated that each neighborhood would have to request it.
B. Extension Strategy Council Discussion
IV. Water System Costs / Cash Flow Needs 7:15 PM
A. Existing Water Debt Cathy Bendel
Bendel provided overview of existing debt. Discussion of use of reserves. Mainly O&P. Overview and discussion of Water Fund annual cash flow.
B. Funding Strategies Dean Zuleger
Zuleger explained the funding strategies.
• Water connectivity / connection charges
• Letter of credits / security bonds
• Private investments / construction of extension
• State bonding
• Resolution with 3M
C. Example Pro Formas LE Avenue Bendel explained the bond payment schedules for 10, 15, and 20 year bond scenarios.
Secured income consists of: letters of credit, WAC, and Pratt/Ryland, Lateral Benefit charges.
Why some properties do not receive LBC was explained. Nelson asked when the $5,800 LBC was established. It was established ~2005-2006. Why that amount? It was determined that it
was the average on past project.
Nelson asked why Pratt/Ryland are not paying
V. Developer Obligations for Extension Council Discussions 7:30 PM
• Should city employ area wide assessment policy to serve new areas with water/sewer?
• Should city require that all WACS/SACS approved at prelim plat be paid up front before
infrastructure is extended?
• Should landowners without defined plans be required to post a method of security before service extension?
• Should a combination policy be used?
Nelson believes that if party wants service early, they should have to pay for it. Mayor agrees, but how do you do it? If water does not happen, these developments do not happen now.
Mayor pointed out that the issue is that city has to run transmission line great distance, but
without users. For first 5 years, water fund will be tight. This does not account any additional
revenue….. Reeves asked about putting water into the two neighborhoods on LE Ave. Cimarron has its own h20 system and the city cannot require them to connect like it can with sewer.
A. Area Assessments Jack Griffin
B. WACS Dean Zuleger
C. Letter of Credit D. Combination Policy
VI. Resident Obligations for Water System Management Council Discussion 8:00 PM
A. Lateral Benefits
Nelson wants only the cost to install the infrastructure. The difficulty is that the cost is variable depending on each property. Staff opinion is that the $5,800 is low and a great deal. Bloyer
wants there to not be a stub. Put it on the resident to pay 100% if want to connect at later date.
Whether there is a realized benefit was discussed. Insurance rates, property value, fire
suppression availability are amongst those identified…. B. Water Assessment Policy C. Surcharges
VII. Conclusions Mayor Pearson 8:30 PM
Mayor Pearson adjourned the meeting at 8:54PM