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HomeMy WebLinkAbout_2001 11 12 City Commission Workshop Minutes CITY OF WINTER SPRINGS MINUTES CITY COMMISSION WORKSHOP NOVEMBER 12,2001 I. CALL TO ORDER The Workshop of Monday, November 12, 2001 of the City Commission was called to order by Commissioner Robert S. Miller at 5: 17 p.m. in the Commission Chambers of the Municipal Building (City Hall, 1126 East State Road 434, Winter Springs, Florida 32708). ROLL CALL: Mayor Paul P. Partyka, arrived at 5:24 p.m. Deputy Mayor David W. McLeod, arrived at 6: 12 p.m. Commissioner Robert S. Miller, present Commissioner Michael S. Blake, present ComP.1issioner Edward Martinez, Jr., present Commissioner Cindy Gennell, arrived at 5:39 p.m. City Manager Ronald W. McLemore, present City Attorney Anthony A. Garganese, arrived at 5:48 p.m. II. AGENDA A. Finance Department Workshop To Review The Water, Wastewater And Stormwater Rate And Charge Study Prepared By Public Resources Management Group, Inc. City Manager Ronald W. McLemore presented the Commission with a brief overview of tonight's topic. Mr. Rob Ori, Public Resources Management Group, Inc., 225 South Swoope Avenue, l'.1aitland, Florida: addressed the Commission on the Agenda Item and related materials, and introciuced his associate, Mr. Jack Burgiel. Mr. Ori advised the Commission that regarding water and wastewater charges that "We have had a lot of - inflationary affects on your system have been there and the costs of operations, yet you have been able rates at steady levels, which is really good." Mayor Paul P. Partyka arrived at 5:24 p.m. CITY OF WINTER SPRINGS MINUTES CITY COMMISSION WORKSHOP - NOVEMBER 12,2001 PAGE 2 OF 5 Commissioner Edward Martinez, Jr. stated, "Let the record show Mayor Partyka is present." Further discussion ensued on growth and projections. l'v1r. Jack Burgiel, Project Manager Public Resources Management Group, Inc., 225 South Swoope Avenue. Maitland, Florida: addressed the Commission on water usage. Mr. Ori added, "The real point here is that growth will be slowing over time and that's an issue." Furthermore, Mr. Ori stated that "What we see is that the system needs about a 17% rate adjustment to keep and maintain financial sufficiency. As we mentioned earlier, the budget itself had a $500,000 utilization of fund balance and you can think right there again that there are some issues brewing with that. This revenue increase will meet the system operating capital needs through our projection 'period, which was through the fiscal year 2006." With further discussion, Mr. Ori pointed out that when they were putting this proposal together, "We wanted to make sure that we had at least seventy-five (75) days of reserves set aside in your operating capital - when all said and done, we fund our capital im~rovements and things of that nature, that we still have cash on hand - we didn't want to take this system to thirty (30) days working capital, and things of that nature. We wanted to make sure we're financially strong." Mr. Ori and Mr. BurgieI suggested three (3) options to the Commission: Option 1 - System-wide One Time Increase of 17.25% Option 2 - System-wide Two-year increases of9.25% per year Option 3 - System-wide Three Year increases of6.75% per year Discussion followed on the suggested 6,000 gallons usage referenced In information provided by Public Resources Management Group, Inc. Commissioner Cindy Gennell arrived at 5:39 p.m. Mayor Partyka said, "Let the record show that Commissioner Gennell is here." Regarding the suggested 6,000 gallons usage, Commissioner Blake stated, "Mayor, I don't have a problem with using some number, but I just think 6,000 gallons - just seems very, velY low when you average it out with the irrigation that is used also. And my concern with this is whether or not our Impact Analysis is correct - if 6,000 gallons isn't really the average number that we should be using." Mr. BurgieI said, "I can check on that number." Commissioner Blake stated, "Okay. Thanks." CITY OF WINTER SPRINGS MINUTES CITY COMMISSION WORKSHOP - NOVEMBER 12.2001 PAGE 3 OF 5 Mr. Ori then said to the Commission, "The results as we discussed earlier, we want to reserve the working capital reserves, we want to get around seventy-five (75) days of working capital. We want to start funding systems renewals and replacements, more on a future basis, not just as a pay as you go basis; we want to start sending funds, because as your system does mature, the ability to recapture dollars - we don't want to issue debts to denI with all of these renewals and replacements, they benefit existing users. We would like to try to get a blend from that to keep your debt rates a little low if we can." Additionally, Mr. Ori added, "The across the board adjustments, we are looking at here would minimize the impact of low end users, everybody essentially would pay the same rate adjustments. We looked at a possible restructuring, but because of the rate adjustment we are proposing, we felt at this time it may not be good to look at that. We can come back, if you want to do that. But, your rates still remain competitive with your neighboring communities." Commissioner Martinez asked Mr. Ori for his recommendation on the suggested Options. Mr. Ori stated, "From a financial standpoint and Utility, I like Option 1 personally because I believe a strong Utility provides long term benefits to the residents. From a term of a customer's standpoint, I would probably go with Option 2." City Attorney Anthony A. Garganese arrived at 5:48 p.m. Mr. Ori added, "What I liked about Option 1 is it produces a lower overall rate when you're done, than Option 2 and 3, and the key is, do you accept the rate adjustment? Which is more important, phase-ins for the customer or financial stability of the system. That's the key, and I like financial stability, personally, that's my personal opinion." Brief discussion covered neighboring communities and their rates. Wastewater was next discussed. Mr. Ori said to the Commission, "Even with the rate adjustments, you appear to be very, very competitive and also recognizing that after the fact, we don't think you are going to need adjustments for - several years." Tape l/Side B Commissioner Gennell asked, "On the reclaimed water, don't the golf courses use a lot of that reclaimed water?" Mr. Kipton D. Lockcuff, P.E., Public WorkslUtility Department Director stated, "Yes they do, probably greater than half." Commissioner Gennell then inquired, "Are they metered?" Mr. Lockcuff stated, "Yes. Winter Springs - our agreement with them, they are looking at 350,000 gallons per day, which is roughly their average. Anything over that we give them, if it is available. - Tuscawilla's agreement requires us to provide up to a million gallons per day, which is right now currently higher than the point flow; so basically they can take all the Tuscawilla reclaimed water by agreement. I think that CITY OF WINTER SPRINGS MINUTES CITY COMMISSION WORKSHOP - NOVEMBER 12,2001 PAGE 4 OF 5 expires in 2006." Mr. Lockcuff added, "They don't pay for any of it at all." Additionally, Mr. Lockcuff said that he thought the expiration date for the agreement with Winter Springs Golf Course was the year 2005. With discussion, Mr. Ori suggested to the Commission that "1 think in 2005 and 2006 you should re-negotiate these rates, and get the commercial rate from them," Mr. Lockcuff explained that "Currently all of the sewer customers are subsidizing the reclaimed water customers." Mr. Burgiel added, "Right now, even the residential customers are being subsidized by the potable water and the wastewater customers." Deputy Mayor David W McLeod arrived at 6:12 p.m. With further discussion on the inequities in the system, Manager McLemore stated, "There is no answer, other than metering. That's the only answer there is to that problem." Mr. Ori added, "The best way to control that is to control that by pricing, and the only way to control that pricing is to meter it." Regarding recapturing capital dollars, Commissioner Blake said, "My concern is - truly the overall financial health of the entire system; and to make sure that some users in the system, many users in the system Ron, aren't subsidizing those few that are watering at $5.00 a month for all they need." Mr. Ori suggested that "There are steps to get to more of an equity based rate. The issue about on-site 'You paid,' 'I didn't pay,' at some point 1 think you almost have to grandfather those in that got that benefit before; however, the cost of metering to get you into your pricing mechanisms and those type of things, can be done so you can start spreading the equity benefit." Discussion ensued on meters, and the time it might take to install the number of meters that would be needed. Commissioner Blake asked, "Whether or not, is the meter installation, the cost of the meters and the cost of installing the meters - is that built into this rate through the elP [Capital Improvements Program] or not?" Mr. BurgieI stated, "No." Further brief discussion ensued with Ms. Louise Frangoul, Finance Department Director on whether there was a separate account for reclaimed uses. Commissioner Blake further stated, "1 just see us doing more of the same that we have already done that I am not happy with, which is all the non-users are subsidizing the users again." Mr. Ori stated, "We could definitely put the cost in - of the meters for the existi'llg users." Commissioner Blake then suggested, "I think it ought to be built into the rate structure for the reclaimed." Mr. BurgieI stated, "Sure. That's easy to do." Discussion followed on whether to further discuss these issues at the Regular Meeting or during another Workshop. CITY OF WINTER SPRINGS MINUTES CITY COMMISSION WORKSHOP - NOVEMBER 12,2001 PAGE 5 OF 5 Deputy Mayor McLeod stated, "I would say you need to schedule another Workshop." Mayor Partyka then said, "I think the consensus is a - Workshop again." Mr. Lockcuff suggested 5:00 p.m. on November 26, 2001 for a second Workshop. Further, Mayor Partyka said, "We'll make it official at our regular Commission Meeting." In conclusion, Mr. Ori advised the Commission and Staff, "We will look at what the cost of the meters would be and what the effect would be on the reclaimed water rates." Commissioner Martinez then asked Mayor Partyka to remind the rest of the Commission abuut the upcoming Workshop. Mayor Partyka stated, "Five o'clock, we'll confirm that- five (,' clook on the 26th. Deputy Mayor McLeod advised Mayor Partyka that he would not be in attendance. III. ADJOURNMENT Mayor Partyka adjourned the Workshop at approximately 6:35 p.m. , .~fP~~T:U~+:~ SUBMITTED: ~..-~... "~';K1/.. i. '_ /'. '/L ... ~ .~ AM>~A L:"jrUACES, CMC ,., ,- '. " . )