HomeMy WebLinkAbout2 - Draft Minutes - Water Resources - May 18, 2009
CITY OF BOULDER, COLORADO
BOARDS AND COMMISSIONS MEETING StA4MARY FORM
NAME OF BOARD/COMMISSION: Water Resources Advisory Board
DATE OF MEETING: May 18, 2009
NAME/TELEPHONE OF PERSON PREPARING SUMMARY: Suzanne Lieberman, 303-441-3266
NAMES OF MEMBERS, COUNCIL, STAFF, AND INVITED GUESTS PRESENT:
BOARD MEMBERS -Robin Byers, Kelly DiNatale, William DeOreo, Susan Iott. Chuck Howe
STAFF - Ned Williams; Bob Harberg; Douglas Sullivan, Erin Kintzle, Joanna Crean; Bret Linenfelser;
Kurt Bauer, Suzanne Lieberman - Secretary.
WHAT TYPE OF MEETING BOLD ONE REGULAR SPECIAL QUASI-JUDICIAL
Agenda Item 1 - Call to Order
The meeting was called to order at 7:01 p.m.
Agenda Item 2 - Meeting Minutes - April 20, 2009.
[Iott arrives at 7:04 P.M.]
Motion: Howe - Move to approve April 20, 2009 minutes as amended.
Seconded: Iott
Vote: 4-0 in favor, Motion passed. [DiNatale not yet present.]
Agenda Item 3 - Public Participation and Comment. [7:06 P.M.]
Water budget rates. Adamski: Asked about triggers for increasing water rates during drought at April
meeting; more interested in getting information on when rates will be decreased as projected storage
indexes increase, versus when rates are increased when rations decrease. Williams: If no drought, rates
stay at same level as what council has approved; even if increased snowpack, water rates and rations stay
where they are. If water supply becomes extremely abundant, rates do not decrease. Adamski: As
projected storage increases beyond 0.4. not a document or policy on rate changes reflecting this? Williams:
Drought Response Plan describes moving into different drought stages, price of water and water budgets
not included in current Drought Response Plan, staff and WRAB working on including this, staff can't
impose rates without council action. Presumably, as city moves away from a more severe drought, would
return to pre-drought conditions. Adamski: But no policy that currently states this? DeOreo: Two ways
rates get adjusted during a drought: 1. adjustment of rates for revenue stability: 2. application of drought
surcharges to enforce water restrictions, but 42 not yet decided. Adamski: So no policy exists on reducing
rates when supply high again? Iott: Understanding is that rates return to what they were prior to drought in
terms of council-approved rates. Williams: When there is no drought, no surcharge, and this is in city code.
Byers: The policy is apparently in the code. Iott: Can we get a copy of the policy in the code? Byers: E-
mail or send Adamski the reference to the policy in the code. Adamski: Has additional public comment
items. [Board agrees to extend public comment time for Mr. Adamski.]
Issue of utilities workgroups exceeding budget. Adamski: Allowing workgroups to exceed their budgets
for consecutive three years is irresponsible [referencing, "Feedback on Peer Review Costs for 2010 Budget
Development," April 20 WRAB meeting]. How does staff respond when a workgroup goes over budget?
Williams: Doesn't recall saying that workgroups are allowed to go over budget for three consecutive years,
but that it can happen and that rationales for exceeding budget are reviewed: sometimes over budget
because more water- or sewer- main breaks than anticipated, other times, poor management of budgets or
unanticipated costs; so there is not a rule about penalties when exceeding budget. Adamski: Three
consecutive years just does not seem fair.
Questions on water rates during drought periods. Adamski: [Referencing memo Williams supplied to
WRAB March 25, 2009 and supplied to Adamski April 20, 2009 ] "A 9% water rate increase was effective
on January 1, 2002. A 3% water rate increase was effective on January 1, 2003. There was no rate
increase in January 2004, though there was a mid-year adjustment in residential block 4 (decrease) and
CII/block 2 and 3 (increase) so that beginning in June 2004, all customer classes and rates were back to
normal." Adamski: Consulted federal inflation rates for that time period: Bureau of Labor Statistics -
2002: 1.59% inflation rate versus a 9% Boulder water rate increase; 2003: 2.27 versus a 3% Boulder water
WRAB Summary
May 18, 2009
Page No. 1
rate increase: 2004: 2.68% with no Boulder water rate increase: so Boulder water rate increases total 183%
of federally-indexed inflation. City appears to be keeping up with inflation. Howe: Consumer Price Index
is not the relevant index; have to look at engineering news record, construction cost index, etc. Adamski:
Was not aware of this because DeOreo discussed rate of inflation at a previous meeting. DeOreo: Didn't
mean to imply rate increases only meant keep ng up with inflation, particularly in terms of operating costs.
Adamski: But city also has a big budget surplus. DeOreo: We will be discussing this later in the agenda.
Iott: So what indices does the city use for adjusting for inflation? Williams: Several: construction, labor
costs, etc.
Procedure for scheduling a WRAB agenda item. Adamski: How does public get an item on the agenda?
Williams: Attend WRAB meeting, e-mail, write a letter, call, agenda item moves through WRAB or other
board and then to city council. Adamski: Draft presentation of drought plan but no public comment
period at the previous VVRAB meeting. Byers: Probably not correct. Adamski: My mistake. Byers: We
want to hear from people: call, e-mail or write a letter.
Agenda Item 4
Matters from Board -
• Flood mitigation. DeOreo: Thanks to staff for answering his questions on flood mitigation plan.
Still planning to talk about this at a future meeting? Williams: For the board to decide if they want
to schedule it as a future agenda item. Harberg: Kurt Bauer is the new city flood engineer who
prepared answers to DeOreo's questions in the memo; will take the lead on emergency flood
response issues for utilities.
Matters from Staff -
• Memo on status of Boulder water supply. Williams: Sent out memo to WRAB; city not calling
for any drought stage or levels this year.
• Updated Benchmarking Report. Williams: Provided in the packet as an information item.
Howe: Such a report a very valuable tool for utilities. Chaired National Research Council
Comnuttee on Privatization of Urban Water Utilities. Under the threat of privatization, many
utilities have turned to more efficient budgeting processes, with many turning to benchmarking to
measure their own progress. Byers: Would like WRAB to consider the study as an agenda item,
extremely useful document. Harberg: Information in report based on 2008 data so it is very
current:. staff wants to continue to do this every year (has already done it four years). AWWA
(American Water Works Association) compiled a 2007 report that updated the previous
benchmarking report. DeOreo: Why have complaints in water taste and odor increased (page 2 of
report). Harberg: Boulder Reservoir issues at the end of the year. Linenfelser: Issues with
Betasso, too, calls also coming in to various city locations, and staff is attempting to consolidate
these more; this might be affecting whether drinking water personnel receive all relevant calls.
DeOreo: Rationale for huge gap between actual expenditures and theoretical investments?
Harberg: Last year city based theoretical investment numbers on replacement schedule of one
percent per year for 75-100 year pipeline life; recent studies indicate that the theoretical
investments might be much lower than what is indicated in the benchmarking report. Iott: Same
numbers here as in CIP? Harberg: Yes, page 8. Most cities not able to keep up with theoretical
investments but Boulder is well above average in most cases on system replacement already.
Howe: EPA's and AV17WA's estimates of maintenance backlog of urban water infrastructure are
substantial. Iott: For items where 2008 is above average, does city use that information to bring
numbers back to average? Harberg: Only in terms of replacement-renewal rate. Howe: Impressed
with city's management of effluent for copper exceedences.
• Update on Boulder Feeder Canal outfall diversion projects. Williams: Per DiNatale's request,
staff has provided a written update on these projects.
WRAB Summary
May 18, 2009
Page No. 2
Agenda Item 5 - Final Recommendation on Wastewater Utility Master Plan.
Sullivan gave the presentation. The Wastewater Utility Master Plan (WWUMP) is an overarching
document that is intended to present key issues, programs, projects, and associated budgets for the City's
Wastewater Utility including the collection system, wastewater treatment plant, and associated water
quality and support programs. The WWUMP is supported by three primary planning documents for the
Wastewater Utility: Wastewater Collection System Master Plan (WWCSMP), Wastewater Treatment Plant
Master Plan (WWTPMP), and the Water Quality Strategic Plan (WQSP).
The mission of the Utilities Division is to provide quality water services, as desired by the community, in a
manner which emphasizes efficient management of fiscal and natural resources, and protects human and
environmental health. In general, the planning process for the Wastewater Utility focuses on identifying
opportunities that continue the high level of service provided to its customers and evaluating the associated
cost of the opportunities. The opportunities and recommendations resulting from the planning process take
the form of capital construction projects: system rehabilitation and repair projects, preparing systems and
operational processes that anticipate future regulations: and evaluating staffing needs. Wastewater and
water quality planning projects, such as the WWTPMP, WWCSMP, and WQSP are the primary tools that
provide the detailed analysis that result in the opportunities and recommendations contained within the
WWUMP.
A series of guiding principles, policies and implementation measures were used to define the planning
process for the Utility. The guiding principles for the WWUMP are based on Boulder's planning approach
to community sustainability through evaluating social, environmental and economic impacts associated
with various program and projects within the city. Specifically, the three guiding principles for the
WWUMP are:
• Protect Public Health and Safety
• Protect Boulder's Natural Resources and the Environment
• Maximize the use of the Wastewater Utility's Funds
In general, the policies that support the guiding principles noted above are defined by the Boulder Revised
Code (BRC) and the Boulder Valley Comprehensive Plan (BVCP). The WWTPMP, WWCSMP and the
WQSP provide the implementation measures by defining planning elements, requirements,
recommendations, and, where applicable, identify capital improvement projects.
WRAB discussion and feedback included: Whether ion-PV (pervaporation) project scaled for using some
power for UV disinfection or just for current use: 15%. Staff will return to WRAB with response on
whether UV disinfection would add 15% to city's power requirements; confirmation that project is maxed
out in terms of wetlands and prairie dogs (city using 5.5 acres). Whether finance people aggressively
regularly refinance, given strong city bond ratings: yes, not daily, but often, based on formulae; whether
rate increases are permanent: yes. Whether the data reflect value engineering solutions: yes, city is not truly
capacity-limited. Whether the digestor versus UV disinfection is more critical: UV, in terms of safety, but
mixing component of digestor also very important. Discussion on age and technological capabilities of
digestor component: questions about chlorine leaks: a few, quickly responded to.
Clarifications: Clarifications on "headworks": physical removal of solids before biological and chemical
removal; significant wear on equipment otherwise. UV disinfection more about safety or economics?
Safety; UV disinfection is highly energy-intensive. Clarifications on differences between fiscally-
constrained plan, action plan, and vision plan. Questions on industrial pretreatment program (page 21): city
has looked at industrial flows for thirteen (13) permitted industries (page 21) but has no inspection power;
industrial survey currently identifying potential unregulated users in Boulder, beyond the thirteen, that
could represent significant industrial flows, which could be potentially subject to future regulation.
Clarifications on how options can or cannot be reconciled with current state and federal standards. Staff not
asking WRAB to pick among the scenarios, but to approve the overall plan.
Public Comment (Adamski): How is 9% handled in CIP for wastewater: a TABOR issue? Williams: Rate
increases for the utilities and bond issuances are council action; the utility itself is not a TABOR-restricted
fund so council action does not go to a referendum or vote of the public like a sales tax referendum.
Adamski: So if city wants to take on $50 million dollars in debt, they don't need to ask voters for those
fund? Williams: That's correct for the utility funds, but not for other types of debt. Byers: The city is a
water activity enterprise under TABOR so issues do not go to the ratepayers, but to council.
WRAB Summary
May 18, 2009
Page No. 3
[8:32 P.M.]
Discussion on recommendation: Iott and Howe think action plan is justified by large infrastructure needs.
DeOreo would like the report to include a better way to summarize the data, e.g. pie chart on debt service;
supports action plan or vision plan: concerns about energy-intensive operations: will start to be addressed
through an energy audit in 2009. Byers's theoretical support for fiscally-constrained option but practical
support for action plan: concerns with "big-ticket" items like endocrine disruptors.
[DiNatale arrives at 8:37 P.M.]
Motion (DeOreo): Move that TAB accept the Wastewater Utility Master Plan.
Seconded: Howe
Vote: 5-0 in favor, Motion passed.
Agenda Item 6 - Update on preliminary 2010 Budget and 2010-2015 CIP.
Williams and Harberg gave the presentation. As part of the city's annual budget process, Utilities develops
a six-year planning budget, this year for the time period of 2010 through 2015. Utilities staff has
formulated revenue and expenditure projections for each of the three utility funds through the year 2015.
Within the budget process Council approves and appropriates funds only for the first year, 2010.
This packet contains information concerning the Preliminary 2010 Utilities Budget and the 2010-2015
Utilities Capital Improvement Program (CIP). The attached fund financials (Attachment A - Water
Utility, Attachment B - Wastewater Utility and Attachment C -Stormwater / Flood Management Utility)
reflect actual revenues and expenditures for 2008, updated revenue projections/rate increases for the
planning period (this includes the phased-in implementation of the adopted Plant Investment Fees), updated
CIP and any proposed budget supplementals (additions to the current budget). The operating budget (i.e.
personnel costs, chemicals, energy, etc.) and transfers will be updated and incorporated into the fund
financials later in May after the city's budget guidelines have been distributed.
At the May 18, 2009 WRAB meeting, staff will ask WRAB for input and feedback on the preliminary 2010
budget and 2010-2015 CIP. Staff will return to the Board on June 15th for further discussion and to solicit
a recommendation to Planning Board and City Council concerning the proposed 2010 Utilities Division
budget and 2010-2015 CIP.
WRAB discussion and feedback included: Whether PIFs can legally be used for operating expenses if
revenues down: probably not, idea of slowing down some of the capital improvements versus increasing
rates. Questions about how deficits covered: utility can continue to accumulate surpluses over a long
period of time, but also have to have a balanced budget, can't run a deficit; clarifications on distinctions
between different reserve funds. Rationale for choosing 25% as the proportion to keep in operating
reserves: set on industry standards and recommendations from bond-rating agencies. City finance
department makes decisions line by line about whether reserves will accumulate interest and whether they
will be invested short- or long- term, why some funds versus others do not accumulate interest. Request for
a summary from staff on how Boulder will use Windy Gap water if not part of the Firming Project. The
extent to which certain items in the Peer Review recommendations are outsourced: combination of staff and
consultants, with periodic inspections contracted out. Carter Lake funding not included in this planning
period unless staff gets additional federal funds, but could be part of capital reserve. Questions on
remaining bonding capacity: as given in benchmarking study, significantly lowered debt ratio. Questions on
annexation issues, including which enclaves are responsible for paying Boulder PIFs: Gapter: all except
stormwater PIFs; Crestview: likely all but stornwater PIFs. Discussion on county's role in flood
mitigation for city - not really proactive. Questions on flood capacity issues for Goose Creek Basin.
Discussion on charging users for hazardous household waste: still an option, but better to initially provide
the service to customers free of charge. Discussion on costs of using water monitors as tools to manage
water within the water budgets. Currently $100 for water meters per account, so monitors at $50 each
would add $1.5 million: currently $10,000 in the budget for monitors.
WRAB Summary
May 18, 2009
Page No. 4
Clarifications: Line item 42, Attachment C-2, Transportation Coordination: explanation for why utility
ratepayers pay for it: many utility components in transportation projects, with stormwater often a large
component. Allows utilities to stay ahead of the curve by taking advantage of upgrades, economies of scale.
Clarification of Line 63, Attachment C-1: funds appropriated not spent or encumbered as of end of 2008:
funds not spent on capital projects carried over. Staff obligated to have council consider zero percent rate
increases for water, wastewater, and stormwater.
[9:56 P.M.]
Public Comment - Rate increases (Adamski): Rate increases don't make sense if considering inflation
data, which was negative for 2009 (inflationdata.com). Thought Broadway reconstruction project was fully
funded through federal government and city sales taxes: didn't realize he was also paying for Broadway
reconstruction project. Sullivan: Yes, transportation projects can include utilities components and utilities
pays for those components (water, sewer, storm). Adamski: Page 4, Option C: zero percent rate increases
across the board, yielding $900,000 deficit. If utilities is rumling a $48.5 - $53.28 million surplus, why
couldn't staff take $900,000 out of the surplus instead of charging ratepayers'? Williams: Sounds like
you're including reserves in the surplus. Iott: Request for staff to explain how surpluses get spent down
over time. Williams: Reserves all need to be subtracted from the fund balance (line 84 in fund financials),
so they're not really surplus; always have to account for designated reserves each year that come out of
fund balance when developing a fund financial that doesn't result in an ongoing deficit. DeOreo: Which
criteria to use for future capital projects for emergencies (line 90)? Williams: Not intended for emergencies
but WRAB suggested that city should accumulate savings to cash finance major projects like the Carter
Lake Pipeline to prevent major rate increases. Capital projects reserves as one way to have a savings
account: buildup cash to appropriate for large future capital projects, or try to do it within the CIP.
Adamski: Still don't understand how city would face hardship without rate increases. Williams: Would
reduce budget by same amount, $900,000 per year, unless expenditures reduced. Adamski: Problem with
reducing expenditures? Iott: City cannot keep infrastructure intact without capital improvements.
Public Comment - Issue of utilities workgroups exceeding budget (Adamski): Mechanism to ensure
workgroups not exceeding budget three consecutive years. Byers: Already addressed in Public Comment
period earlier in agenda.
Discussion on preferred options: Staff will return in June with budget and CIP for final WRAB
recommendation. DeOreo: 5% water; 2% wastewater: 2% stormwater, Option A. DiNatale: Given
economy, 4% water: 2% wastewater; 2% stormwater. Howe: No strong opinion; water underpriced under
any scenario. Consumers also only care about total monthly bill, not breakdowns. Iott: I% wastewater and
1% stormwater possible? Williams: Yes. Byers: 4% water: 2% wastewater; 2% stormwater. Ratepayers
tired of incessant increases if they don't see bang for buck. Request to have staff supply budget information
in an Excel sheet.
Agenda Item 7 - Discussion of 2009 WRAB Retreat.
Williams: Scheduled Monday, June 1 in the 13th Street Conference Room. Howe: Aurora study discussed
at retreat? Crean: Staff was planning to incorporate paper into drought response item at regular June
WRAB meeting. DeOreo: Purpose of retreat is for WRAB to discuss its goals. Iott: Also about strategy
and figuring out what WRAB can and cannot accomplish. Byers: Food: family-style from Noodles and
then everyone to bring an appetizer, salad, or dessert. DiNatale: Have Secretary also bring flipcharts,
materials, etc.
Agenda Item 8 -Discussion on future schedule. [10:42 P.M.]
Williams: June scheduled items: final recommendation on budget, tentatively, flood management and
critical facilities ordinance: draft CEAP for Carter Lake Pipeline. Decision to postpone discussion of next
round of changes to Drought Response Plan to July WRAB meeting, pending availability of Carol
Ellinghouse, with the final recommendation in August or September. DeOreo: ICI study? Williams:
Nothing being done on this.
Agenda Item 9 - Adjournment
Motion: Motion to adjourn by Iott.
Seconded b : DiNatale.
WRAB Summary
May 18, 2009
Page No. 5
Vote: 5-0 in favor, passed.
Meeting adjourned at 10:50 PM.
Date, Time, and Location of Next Meeting:
The next WRAB meeting will be Monday, June 15 - 7 p.m., regular meeting, at the 13'x' Street Conference
Room, unless otherwise decided b staff and the board.
These are summary minutes. Audio tapes for full record are available through Central Records or on the
WRAB web site.
Minutes approved by:
Date:
WRAB Summary
May 18, 2009
Page No. 6