FINANCE COMMITTEE MINUTES

 

MARCH 13, 2006

 

 

 

The meeting was called to order by Chairman Burke at 6:47 p.m.

 

MEMBERS PRESENT:  Dan Fogt, John Gore, David Burke

 

OTHERS PRESENT:  Kathy House, John Morehart

 

AGENDA:

 

1)    ERU rates

Per recommendation from Malcolm Pirnie, the committee agreed to move forward with an ERU rate increase.  The new rate of $4,450 will be moved forward for legislative action by Council.

 

2)    Water tap fees

Mr. Burke proposed that the single family rate structure remain unchanged.

 

Multi-family dwellings will be charged a percentage of ERU’s.  Need to find a way that these units are not a burden and that they pay their fair share into the infrastructure of the City.  Proposed charging .7 or 70% of the full ERU rate per family dwelling, regardless of number of bedrooms.  Mr. Fogt was in favor of this proposal. 

 

Research showed some cities charged depending on number of bedrooms.  The above proposal seems to be the average number of what the average unit is being charged and is the most simplified method.

 

Mr. Fogt presented a draft of a policy of what City of Delaware is looking at.  Delaware feels master metering has some engineering and financial drawbacks.  Current master metering policy does not have a financial, viable ideology with regards to setting rates and capacity fees for water and sanitary service.  He noted an example in the draft that the master metered development with 150 units has avoided paying a total of $1.3 million.  Mr. Fogt feels Marysville is in that same situation, but maybe not to that extent.  By running water up to the master meter and the owner maintaining it from then on, there could be an O&M savings to the City.  Ms. House noted that there is a larger turnover in apartments, therefore, the shut-off/turn-on service calls for the city could be significant.  Mr. Morehart will check, but he believes there is currently a way where the City bills a user rate where it’s based on multiple units.  There may be a way to factor in multiple units on one meter.

 

Mr. Fogt is not suggesting disposing of master metering.  Proposed not charging for a 3” meter, but charge for dwelling unit instead, but install a 3” meter or whatever size meter is required. 

 

The reason for proposing this change is to not burden the single family resident and make it more equal across the board.  Since there is no inch meter charge on a multi-family dwelling, that it would be more beneficial to the developer to put in for example a 2 capacity size meter, which would theoretically increase the residential pressure of the system not having a restrictor at that point , as well as benefit those residents beyond that meter, because their water pressure would improve.  Based on the larger size units, City would recoup more adequate cost base back to the capital of the plant and reservoir. 

 

Ms. House would like the engineer and public service director to review the proposal to see the impact from their perspective. 

 

Possibly could break out commercial from the pool to include negotiated taps for larger taps to see how legal it is and see where it falls.  Mr. Morehart discussed this issue with the law director.  Will have to review the code to see if it can be done. 

 

Mr. Fogt asked how multiple user tap requests could be handled until something could be enacted.  Mr. Gore stated contingent on feedback from Mr. Roush, Ms. Davies and Mr. Aslaner, legislation could be brought to Council.  If there are issues, could be referred back to Finance Committee.  Mr. Burke and Mr. Fogt will continue to work on this. 

 

In summary, single family residential will remain unchanged. Will continue to work on a proposal for multi-family dwelling.  As far as commercial, larger negotiated taps, Mr. Burke will work with Mr. Aslaner to be sure this would benefit the City significantly.   Will work Mr. Eric Phillips on some EDAP constringent issues so that it’s not taken advantage of and it fit certain parameters for certain business or employers.

 

Mr. Morehart asked for confirmation that all meter sizes would increase.  Response was yes, based on the ERU size.  Mr. Morehart asked about changing the Rate and Incremental Rate, which would go into the Incremental Fund, whereas the Rate goes into the other capital fund.  It was decided to change the incremental rate, but not the rate.

 

Mr. Burke referred to the American City and County Municipal Cost Index link. Very few cities review fees annually.  Every three years is recommended.  Requested City Engineer to review this index to see what he can come up with.

 

Committee will research and see about implementing by the end of the year.  If passed in 2006, fees could be effective in 2007. 

 

Committee will work on proposal for multi-family dwelling, then commercial then indexing.  ERU rate is a known, as well as multi-family dwelling, it’s just how much.  Will then work on commercial and indexing at the end of the year.

 

Mr. Morehart commented on tap fees.  At a previous meeting, Mr. Wing had asked for a fact sheet on tap fees.  Mr. Morehart presented a draft fact sheet.  He’ll continue to work on it. 

 

3)    Sewer tap fees

Discussed how the future water tap structure would affect sewer tap and connection fees.  There is no sewer meter for residential; it’s based on water consumption.  Mr. Morehart explained that tap fee is based on water meter size.  Mr. Burke stated the same per unit charge could be charged for sewer as is charged for water.  It would be consistent.  Mr. Fogt feels the sewer charge should be consistent with water charge.  Mr. Burke feels .6 or .7 is a fair number.  It was thought that sewer could be a little lower than water. 

 

Mr. Burke will talk with Mr. Anderson of the Water Division to get further statistics.

 

Committee will think about bringing sewer in sync with water.  Delay redoing sewer study with Malcolm Pirnie.  Use current sewer tap fees.  Look at index concept. 

 

Meeting adjourned at 7:57 p.m.