HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 11/4/2003 * PLEASE NOTE: Since the Glendale City Council does not take formal action at
the Workshops, Workshop minutes are not approved by the City Council.
MINUTES
CITY OF GLENDALE
CITY COUNCIL WORKSHOP
November 4, 2003
1:30 p.m.
PRESENT: Mayor Elaine M. Scruggs, Vice Mayor Thomas R. Eggleston, and
Councilmembers Joyce V. Clark, Steven E. Frate, David M. Goulet,
H. Phillip Lieberman, and Manuel D. Martinez
ALSO PRESENT: Ed Beasley, City Manager; Pam Kavanaugh, Assistant City
Manager; Craig Tindell, Deputy City Attorney, City Attorney; and
Pamela Hanna, City Clerk
1 . GLENDALE HISTORIC PRESERVATION PLAN
CITY STAFF PRESENTING THIS ITEM: Mr. Tim Ernester, Deputy City Manager; Mr.
Jon Froke, Planning Director and Mr. Ron Short, Long Range Planning Manager.
This is a request for City Council to review and provide comment and direction on the
proposed update of the Glendale Historic Preservation Plan (GHPP). The GHPP
provides a framework for the Historic Preservation Commission to:
• Build historic preservation program capacity for the commission and staff
through training, networking, and standing committees.
• Improve community awareness and support for historic preservation through
partnerships, local resident education, and visitor related promotion.
• Survey, analyze, and designate potential historic sites for placement on the
local, state, and national register.
• Ensure protection, through Design Review guidelines, historic preservation
districts, and incentives through tax credits and bonds.
Updating the 1992 GHPP is important in order to outline an active preservation process
and identify and prioritize key areas for preservation. The anticipated outcome will be
increased preservation of Glendale's historic resources.
• The GHPP addresses the Council's priority of managing growth and preserving
neighborhoods.
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• An objective of the General Plan Redevelopment Element states: "Preserve historic
communities by providing diagnostic consultation for maintaining consistent
architectural features, street plantings, monumentation or signage."
• The adopted City Center Master Plan has an Urban Design Strategy titled "Preserve
Historical Landmarks." The strategy recommends renovation and preservation of
significant historical resources.
• In July 2002, the City of Glendale as a Certified Local Government, received a
Federal Historic Preservation Fund Pass-Through Matching Grant for $10,000 for
the Glendale Historic Preservation Plan.
• In December 2002, Ryden Architects, Inc, and Akros, Inc, were selected to provide
the consultant services for the plan. The consultants reviewed several historic
preservation resource surveys, documents, and prepared the Citizen Participation
Plan. The consultants and staff developed a historic preservation survey in March
2003 that was distributed to over 1,000 residents representing business, community
leadership, historic property owners, community-at-large, and city staff. Three
hundred surveys were returned and 95 people indicated an interest in participating
in a focus group. The results of the survey indicated the challenges confronting
historic preservation and what is the priority for preserving historic resources.
• On May 10, 2003, and May 13, 2003, focus group meetings were held at Manistee
Ranch House. Thirty-five people actively participated and thoroughly discussed
challenges and priorities for historic resources.
• A Preliminary Historic Preservation Plan was presented at the June 26, 2003
Historic Preservation Commission meeting for review and discussion.
• The Historic Preservation Commission recommended approval of the final GHPP at
their July 24, 2003 meeting.
• The GHPP adoption will improve program capacity, public awareness, designation
of historic sites to the local, state, and national registers of historic places and
develop incentives for preservation.
• Advancement of the Historic Preservation Program will help to further the creation of
a "Sense of Place" for the City of Glendale.
• The Historic Preservation Commission approved a Citizen Participation Plan for the
GHPP.
• A historic preservation survey was conducted with over 1,000 questionnaires sent to
targeted groups of city staff, community leaders, community-at-large, property
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owners, and business owners. Three hundred completed questionnaires were
returned.
• Two public focus meetings were held at Manistee Ranch House involving thirty-five
participants.
• The consultants made monthly status report presentations to the Historic
Preservation Commission.
• The city web site was used to inform citizens of the meetings.
• The outcome from the citizen involvement was a basis for prioritizing historic
resources.
The cost for updating the Glendale Historic Preservation Plan was $20,000. Funds
were available in the Glendale Historic Preservation Plan account and through the
State Historic Preservation Office using Federal Historic Preservation Fund Pass-
Through Grant.
Grants Capital One-Time Budgeted Unbudgeted Total
Expense Cost
10,000 X 10,000 20,000
Account Name, Fund, Account and Line Item Number:
Glendale Historic Preservation Plan
4301-47-7686
Provide staff direction on the proposed updated GHPP.
Mr. Short reviewed challenges to historical preservation as identified during focus
group meetings and the survey. He stated participants in the focus groups and
respondents to the survey identified their priorities with regard to future designations,
with preservation of homes of the original settlers being listed as the highest priority.
He said significant schools and churches were identified as the next highest priority,
followed by downtown commercial buildings, early 20th century neighborhoods, historic
landscapes, farms and agricultural properties, railroad buildings and structures, public
and government buildings and industrial buildings. He said the plan finds the city
needs to do additional work in four areas: improving the Commission's capacity through
training, conferences and workshops; expanding resources provided to the public;
building community awareness and support; and surveys and designations.
Councilmember Martinez complimented staff and the Commission on the plan. He
asked if both areas and single residences can be designated. Mr. Short responded
yes, noting however a historic district overlay is required for designation.
Councilmember Martinez expressed concern about the Landmark Schoolhouse, stating
he would like to see it preserved. Mr. Short explained the school district received a
Heritage Grant, however, they had to return the grant when cost estimates came in
considerably higher than originally projected. Councilmember Martinez pointed out the
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plan makes no mention of designating the area between Glendale and Maryland
Avenues along Grand Avenue. Mr. Short explained the plan is based on surveys that
were conducted in 1997, agreeing they need to update the surveys and look at cultural
diversity resources in other areas of the city.
Vice Mayor Eggleston asked if the Commission identifies homes and properties and
then speaks with the property owners to determine their interest in and knowledge of
the preservation process. Mr. Short stated the Commission has not conducted a
survey since 1997, however they look at renovation projects to ensure they are in
keeping with the character of the area. He noted many of the Commission members
are well acquainted with historic properties and their histories. Vice Mayor Eggleston
asked if designation improves property values in a neighborhood. Mr. Short expressed
his opinion it does, stating, however, he has not performed any formal studies to
support his opinion.
Councilmember Clark asked if the plan applies to the entire city. Mr. Short responded
yes. Councilmember Clark asked for a definition of the terms "overlay" and
"designation". Mr. Short explained the local historic preservation district is an overlay
district over the base zoning district. He said a property is then given a local or
national designation. Councilmember Clark asked about the criteria an area has to
meet to be classified as a local historic district overlay. Mr. Short stated the criteria
have not yet been developed. Councilmember Clark asked about the results of the
1997 survey. Mr. Short said the study identified 800 properties as potentially eligible,
however only 200 inventory sheets were done. He stated the Commission has not yet
determined the frequency with which surveys will be updated. Councilmember Clark
asked if property owners are fully informed of renovation restrictions associated with
historic district overlays and designation. Mr. Short said the city will inform property
owners of the design criteria associated with historic properties. Councilmember Clark
asked if an area can be designated as a historic district overlay if one or more property
owners in the area are not interested in designation. Mr. Short stated strong support of
a neighborhood will be required.
Mayor Scruggs noted the 1997 survey did include local criteria. She suggested they
survey the entire city, identifying all properties that fall just outside the 50 year criteria,
but otherwise meet the criteria.
Councilmember Goulet asked if the current process allows for efficient designation of a
property. Mr. Short said, based on the plan, the Commission will look at the process to
see if changes are warranted. Councilmember Goulet asked if the size of a facility will
determine which of the ten properties identified in the plan are undertaken first. Mr.
Short explained the list represents the properties citizens believe to be most important.
Councilmember Goulet asked if there have been any discussions concerning moving
historically significant structures to different sites. Mr. Short said, depending on the
grants it receives, the Commission could discuss such options in the future.
Councilmember Goulet suggested the Commission host or conduct historic tours to
increase community interest and awareness. Mr. Short said the Commission intends to
give historic tours on a periodic basis.
Mr. Froke noted the city is working with an applicant on a potential farm or agricultural
property.
Mayor Scruggs suggested they adorn historic properties with a plaque describing each
property's historic significance.
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Mayor Scruggs asked if the results of the citizen survey were compiled into a summary
document. Mr. Short responded yes, noting the results were also incorporated into the
plan. Mayor Scruggs expressed her opinion that the Glendale City Council does more
for historic preservation than other City Councils. Mayor Scruggs and Councilmember
Clark asked for copies of the surveys.
Councilmember Frate suggested the city look at designating the hanger and tower at
Thunderbird Field.
Mayor Scruggs pointed out structures, once designated, cannot be modified or
demolished unless the property owners go through an extensive process. There are
responsibilities that are assumed designation. The council is anxious to see a
complete list of properties that are eligible or will soon be eligible.
2. UTILITIES INFRASTRUCTURE NEEDS AND RATES ASSESSMENTS
CITY STAFF PRESENTING THIS ITEM: Mr. Ken Reedy, Deputy City Manager; Mr.
Roger Bailey, Utilities Director and Ms. Sharon Ibarra, Senior Management Assistant.
Consultants: Mr. Jake Boomhouwer and Mr. Dan Meyer with Black & Veatch
Corporation.
This is a request for City Council to review and provide direction on the utilities
infrastructure maintenance plan, needs assessment studies and rate analyses.
This is an opportunity to update the City Council on the current status of the city's
utilities' infrastructure maintenance, replacement and expansion needs. It is also an
opportunity to present the costs of implementing the recommendations developed by
several consultants.
The sewer rate increase and water rate increase are required in order for the Water
Enterprise Fund and the Sewer Enterprise Fund to maintain adequate operational cash
reserves and finance a 10-year Capital Improvement Program (CIP) necessary for the
viability of the sewer system and the water system. The rate increases will also help to
offset costs due to escalating regulations and mandates set by federal and state
regulatory agencies related to the operational aspects of all City of Glendale water and
wastewater treatment facilities.
The city's Utility Department must be able to meet the financial criteria set by the
bonding companies as a prerequisite to receiving a superior bond rating. The increase
in rates will help the city meet the required financial criteria.
The water Development Impact Fees (DIF) are necessary so that the city can expand
or improve its facilities to serve new growth. Otherwise, existing residents could
potentially experience a decline in the level of services they receive. A fee on new
development is used to finance costs related to additional capacity.
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Timely replacement and/or rehabilitation of the city's utilities infrastructure will enhance
the quality of life for Glendale residents. In addition, by implementing these
recommendations, the city will remain in compliance with regulatory standards. This, in
turn, will maintain the quality water supply for Glendale residents. The City Council
approved the contracts for needs assessments related to the Water Master Plan, the
water distribution system, and the sewer collection system.
In order to be consistent with the Council goals of providing financial stability and
coordinating exceptional service delivery, an increase in sewer rates and water rates is
necessary.
Also, consistent with Council policy, the increase in water Development Impact Fees
will enable growth-related projects to be self-supporting.
BACKGROUND INFRASTRUCTURE
The city has provided water and wastewater services for more than 50 years. The
utilities infrastructure includes water treatment plants, wells, reservoirs, water
distribution, wastewater collection, effluent distribution, and wastewater treatment
plants. All of these assets vary in life and value and in maintenance and replacement
costs. As the city nears build out, the focus will be on citywide maintenance of the
existing infrastructure.
Evaluations of the water and wastewater systems have recently been completed in
order to provide staff with the future needs of the systems. Additional resource
allocations will be necessary to maintain the infrastructure in which the city has already
invested and which has been required for development. This cost will include, among
other things, pipe replacements and system enhancements related to changes in
development and continued build-out of the remaining system. Many of these areas will
require adjustments to the maintenance costs and also some changes in the CIP.
Failure to provide adequate resources will have an effect on the long- term life of the
infrastructure and a potential for increased costs, disruption of service and city liability.
The following consultants were hired and have completed their respective needs
assessments:
• Black & Veatch —Water Master Plan
• CH2MHill — Water Distribution System
• HDR — Sewer Collection System
SEWER RATES
At the June 5, 2001 Council workshop, an in depth study of the water and wastewater
system was presented by consultant Black & Veatch. City Council also reviewed the
fiscal year 2001-02 operating budgets, the Capital Improvement Plan for fiscal years
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2002-11 and associated rate recommendations. As evidenced by the study, the costs of
constructing, maintaining and operating the city's utility system were continuing to
increase. The in depth study included an evaluation of the existing rate structure,
assessment of the sewer rate calculation formula and evaluation of the CIP. The CIP
included the expansion of the West Area Wastewater Reclamation Facility and
improvements to the 91st Avenue Wastewater Treatment Plant to address both existing
and projected treatment requirements.
Council concurred with the findings of the water and sewer rate analysis conducted by
Black & Veatch, which incorporated the results of the comprehensive utility system
study, and directed staff to begin the three-year process of adopting the recommended
4% annual sewer revenue adjustment and modification to the sewer user charge
schedule. These adjustments have varying effects on residential and commercial
customers.
WATER RATE AND DEVELOPMENT IMPACT FEES
Black & Veatch was selected as the consultant to complete the Water Master Plan. In
support of the Water Master Plan, Black & Veatch conducted a water and sewer rate
analysis and established a recommended water and sewer rate increase in order to
meet the future water needs of the city. This recommendation is based on a detailed
analysis of revenue generated monthly under the existing rate structure and the future
needs as determined by the findings detailed in the Water Master Plan and other
studies.
The updated review and evaluation of revenues and revenue requirements for the City
of Glendale Utility Department were conducted for fiscal years (FY) 2004 through 2014,
the study period.
Consultant Black & Veatch also prepared an updated report on the city's Water and
Sewer Development Impact Fees. Their update utilized the methodology set forth by
Tischler and Associates, Inc. in the comprehensive fee study completed in 2001. Based
upon their evaluation, they recommend that water development fees be increased and
that the sewer development fees remain the same.
The Water Development Impact Fee report documents the cost of the water facilities to
maintain current levels of service while accommodating new development, and
proposes changes to the current Water Development Impact Fees. Revenue from the
proposed charges will cover the capital costs associated with growth.
PREVIOUS ACTION TAKEN ON ITEM
INFRASTRUCTURE
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The Water Master Plan portion of the Utilities Infrastructure Needs Assessment was
presented and discussed at the October 7, 2003 Council Workshop. The Mayor and
Council directed staff to complete the remaining portion of the presentation at a later
date and to provide additional spreadsheets and information.
SEWER RATES
Council requested that the proposed sewer rate scheduled to be heard at the
September 9, 2003 Council meeting, be reviewed and brought back to a Council
Workshop.
On July 8, 2003, the City Council recommended a public hearing be held on September
9, 2003 regarding the implementation of the revised sewer user charge adjustments to
be effective with the October 2003 sewer utility billing.
On September 10, 2002, the City Council conducted a public hearing and adopted a
resolution implementing a 4% increase in sewer user charge adjustments effective with
the October 2002 sewer utility billing.
On July 9, 2002, the City Council adopted a notice of intention to increase sewer user
charges and set the public hearing for September 10, 2002.
On September 25, 2001, following the legally prescribed public hearing, Council
approved the first of three yearly 4% increases in sewer user charges.
At the June 5, 2001 Council Workshop, a notice of intention was adopted to increase
sewer user charges and set the public hearing for September 25, 2001.
WATER RATES AND DEVELOPMENT IMPACT FEES
The last increase in water rates was 3%, effective for all utility bills on and after
November 1, 1993.
The last increase in Water Development Impact Fees was January 10, 2002.
COMMUNITY BENEFIT
The expansion, replacement and/or rehabilitation of the utilities infrastructure will
ensure that Glendale maintains its long history of providing quality water and
wastewater services to its residents and businesses, while complying with all local,
state and federal regulations.
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An increase in sewer rates will benefit Glendale residents by enabling the Utilities
Department to continue to provide excellent sewer services and quick response times
to any problems.
By implementing the new water rate schedule and water impact fees, the city will be
able to maintain its current level of service to existing residents and support future
growth.
DIRECTION AND POLICY GUIDANCE
Review and provide direction on the utilities infrastructure maintenance plan and needs
assessment studies;
Direct staff to bring the postponed sewer rate increase to an evening council meeting to
set the public hearing; and,
Consider and provide direction on supporting increases in water and sewer rates and
Water Development Impact Fees.
DISCUSSION
Mr. Bailey stated the city's population is expected to grow to 262,000 at build out which
is estimated before 2025 and water demand is expected to increase to 23.3 billion
gallons per year.
Councilmember Clark pointed out the population exceeds annual water demand for the
years 1980 through 2013, however, water demand suddenly exceeds population at
build out. Mr. Reedy explained demand projections are based on the amount of water
the General Plan estimates will be needed for all uses, including commercial uses.
Mayor Scruggs said population is expected to increase by 15 percent by build out,
however, water demand is expected to increase by 45 percent. She asked what
accounts for the significantly higher increase in water demand. Mr. Reedy stated the
model is based on the assumption that everything will be built according to the plan.
He said, however, they will monitor development to see if the expected level of demand
is being met. Mayor Scruggs noted some of the projects the Council is being asked to
move into the CIP will more than double the original CIP. Mr. Reedy pointed out many
of the projects do not come online until after 2015. Mayor Scruggs asked if staff is
requesting a series of rate increases over the next ten years that will ultimately result in
an almost 50 percent increase in residents' bills. Mr. Reedy responded no. Mayor
Scruggs suggested they consider restructuring the rates to burden the user category
responsible for the increased demand.
Mr. Bailey reviewed average annual demand, monthly average demand and peak day
demand levels for 2002 and 2006. He explained both monthly average demand and
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peak day demand dictate when new facilities are brought on line and the capacity of
those facilities. He said the peak day demand is expected to increase to 77.8 million
gallons per day by 2006.
Mr. Reedy cautioned against using last year as a model of peak demand, explaining it
was not one of the highest peak years on record. He noted two of the last eight years
had peak days that more clearly portray why a maximum capacity of 119 million gallons
is necessary by 2006.
Councilmember Clark asked who is responsible for the increased water demand. Mr.
Reedy explained the peak demand requirement is based on maximum consumption for
the worst year. He said all users contribute to the city reaching its maximum
consumption level.
Mayor Scruggs asked if staff is planning for the highest usage day of the year. Mr.
Reedy clarified they are planning for the highest consumption period. Mayor Scruggs
asked which years exceeded 2002 in terms of water usage. Mr. Reedy said, per capita,
2003 will be higher, explaining that the summer was hot and temperatures over one
hundred continued into October. Mayor Scruggs asked what factors went into
determining the increase in peak day demand between 2002 to 2006. Mr. Meyers
explained the models look at recent historical data and use that data to project future
levels. He noted projections from the master plan five years ago showed water
demands for 2002 to be larger than actually needed. He said data from 1993 to 2003
was used to determine the projected increase in demand between 2002 and 2006.
Glendale uses a peaking factor of 1.6 above average daily demand as a design
parameter.
Councilmember Lieberman asked if they are using a 1.6 percent growth rate. Mr.
Meyer explained they used numbers in the 2002 General Plan to determine population
growth. He said they anticipate the city's population to reach 232,000 by 2006.
Councilmember Lieberman expressed his opinion the city is growing by at least 5,000
people per year, noting the Planning Department estimates a population of 251 ,000
people by 2008. He said he believes the plan's growth rates, both in terms of
population and water demand, are too conservative.
Councilmember Martinez asked what happens if capacity is not available to meet peak
day demand. Mr. Reedy explained a number of people would not be able to draw water
and residents would likely be subjected to rationing measures. Councilmember
Martinez suggested the city look closely at water conservation measures. Mr. Reedy
said the city has to maintain a balance between demand and conservation.
Councilmember Clark commented that, while the city is in a drought period, there is no
information to indicate the city will not be able to meet demand at all times. She said
the city seems to be building for the few days of the year when peak day demand is
reached. She asked how long can the city store water. Mr. Reedy responded three
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days. He said, while staff is recommending some additional storage along with
additional plant capacity, they are also recommending additional surface water
treatment capacity and well capacity since well capacity is a cheaper solution during
periods when demand is at peak levels. Councilmember Clark expressed her opinion
storage capacity may be a more important strategy. She agreed with Councilmember
Martinez that conservation measures should be considered, specifically an educational
program that encourages residents to reduce their consumption of water. Mr. Reedy
explained maximum day demand is created by extremely long and hot weather
patterns, therefore, storage requirements cannot address the problem. He said, while
water restrictions can be a viable solution for short term shortages, it is difficult to
change people's long-term behavior patterns.
Mayor Scruggs asked if the model takes into consideration the shift in the types of
housing coming into Glendale. Mr. Reedy responded yes.
Councilmember Goulet questioned the practicality of building to peak day demand
versus average daily demand. He asked if staff has researched to what degree the
public would support alternative methods for reducing peak day demand during the
summer months. Mr. Reedy explained the issue is more complex than simply asking
residents to conserve water. He said, while water conservation has significant impacts
on demand, it can also have dramatic social effects. He pointed out 35 percent of
residents utilize swamp coolers in June and July, meaning water conservation would
come at the expense of other water usages.
Councilmember Lieberman noted this year's average temperature was 1.6 degrees
higher than the average for the previous 100 years and temperature records were set
three times during the month of October.
Councilmember Martinez asked if any cities give incentives to homeowners who reduce
their water consumption. Mr. Reedy said Tucson is known for their effective water
conservation program.
Mr. Meyer said Glendale's peaking factor of 1.6 is in line with other valley cities, whose
peaking factors range from 1 .6 to 1.8. He noted reserve capacities in other valley cities
vary from a minimum of 10 to over 25 percent of the treatment capacity.
Councilmember Martinez asked if the model considers catastrophic events. Mr. Meyer
said part of the study looked at what would happen given the loss of different supplies.
He said a catastrophic failure of the complete supply on a June day would obviously
force severe water restrictions, but it appears Glendale will have the capability of
meeting minimum winter demands given some degree of water restrictions.
Mr. Bailey continued his presentation, explaining by 2005 Glendale is utilizing
temporary capacity to take care of existing and future demand. He said the Western
Area Facility should come online in 2006 and groundwater facilities will come online in
Zone 4 and Zone 2 in 2010 and 2013, respectively. He stated a Zone 4 facility
expansion is planned for 2016 and another groundwater treatment facility is scheduled
for 2020. He said the Cholla treatment facility would likely be expanded in 2025 to
meet any additional demand.
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Mr. Reedy said whether or not they actually proceed with the plans for additional
reserve capacity between 2013 through 2025 will depend on demand. He stated
constructing the facilities one-by-one, as needed, is the most cost effective solution.
He noted the city is currently utilizing capacity at the Pyramid Peak Treatment Plant in
excess of the contract amount.
Mr. Reedy reviewed a chart of annual water supply versus demand, noting CAP water
and Groundwater volumes change over time. In discussing demand levels for 2002, he
said the city had a total capacity of 67.6 million gallons per day in July, but a total
capacity of only 39.6 million gallons per day in January when the Cholla Plant is offline.
He pointed out additional well capacity will be needed to meet peak day demand in
January. Mr. Bailey noted the city's reserve capacity is reduced to only 3.6 million
gallons per day in July. Mr. Meyers explained staff found additional resources in the
CAP supply to ensure additional reserve capacity in 2002, however, those resources
will not necessarily be available to Glendale in the future.
Vice Mayor Eggleston asked about the city's recharge water. Mr. Reedy said recharge
water represents the cheapest solution, which is why staff is recommending the
groundwater treatment plants. He explained that, while the water in the city's wells
currently meets federal requirements, the groundwater treatment plants will be
necessary within the next ten years to treat the water once it no longer meets
requirements.
Mr. Bailey discussed how the city will meet critical demands in 2006, explaining total
available capacity and total demand in June are expected to be 81.6 million and 77.8
gallons per day, respectively. He said available capacity and demand are expected to
be 43.6 million and 37 million gallons per day, respectively, in January when the Cholla
Plant is shut down.
Mayor Scruggs asked if the city will still be borrowing additional CAP capacity in 2006.
Mr. Reedy explained the city originally expected to borrow 33 million gallons per day in
2006, making a total capacity of 33 million gallons per day at Pyramid Peak Plant,
however, Peoria indicated it will need its 3 million gallons per day, reducing the amount
of capacity available to Glendale to 30 million gallons per day. Mayor Scruggs asked
how much excess capacity is available. Mr. Reedy said, while there is a large amount
of excess capacity today, many cities plan to use that water in the next 10 to 12 years.
He said staff assumes the city will be restricted to its contract amount before 2025. Mr.
Meyers noted cities that have CAP water rights are required to submit their order for
the next year by October 1. Mayor Scruggs asked if the way to reduce the city's
reliance on borrowed capacity is to increase its groundwater capacity. Mr. Meyers
explained the city relies on three different water resources, allowing for some flexibility
to meet demand.
Councilmember Lieberman asked about the possibility of buying additional CAP
capacity from the Indian Tribes. Mr. Reedy stated the city is currently involved in a
lawsuit that allows the city to acquire an additional 3,053 acre feet of re-rated CAP
water. He said whether the city purchases additional capacity in the future has not
been decided and would not necessarily eliminate the need for additional facilities.
Councilmember Lieberman asked where the city will get the water for the additional
plants if it is already at capacity. Mr. Reedy explained the city has stored water credits
and continues to store water credits through aquifer recharge projects. He said the
city's goal is to continue to use wells that produce high volumes of water and use
groundwater treatment to ensure the water meets regulatory requirements.
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Councilmember Lieberman asked about the cost of bringing a new well online. Mr.
Reedy said it costs approximately $500,000 per well.
Mr. Bailey discussed how the city will meet critical demand at build out. He said the
city's total available capacity in June is expected to total 119 million gallons per day at
buildout. He stated demand is projected to reach 101.5 million gallons per day,
therefore, the city will have approximately 15 percent in reserve capacity. He pointed
out total available capacity in January is lowered to 56 million gallons per day and
demand is expected to reach 49.1 million gallons per day, resulting in a 12 percent
reserve capacity.
Mr. Bailey stated stricter standards in the Federal Safe Drinking Water Act and
declining groundwater quality are driving water quality improvements. He said the
recommended master plan calls for 18 miles of transmission mains, primarily in Zone 4,
16 million gallons of additional reservoir capacity citywide, and 44 million gallons per
day of additional booster pumping capacity citywide. He said the plan calls for several
new facilities, phased over 25 years. He said $126 million in improvements are
planned for the first ten years and $77.6 million in improvements are planned for the
remaining years. Mr. Reedy pointed out the proposed water and sewer rate increases
and impact fees relate only to the first ten years of the plan.
Councilmember Martinez asked at what point will the city decide if additional rate
increases will be needed in the future. Mr. Reedy said the rates and impact fees
recommended in the first 10 years of the plan will be necessary, however, the second
10 year period has not yet been evaluated.
Mr. Bailey said the Distribution System Evaluation Study identified the following
problems: 1) 53 percent of the study area is older than 25 years; 2) the majority of the
study area is asbestos cement pipe; 3) disruptions of service; 4) un-looped
pipes/parallel pipes; 5) pipes under railroad crossings; and 6) small diameter pipes. In
response to those problems, they are recommending the city implement a replacement
program, phased over 10 to 15 years, to reduce the risk of breaks and water outages
and that a proactive maintenance program be established, which could eventually
result in a higher ISO fire insurance rating.
Councilmember Clark pointed out other areas of the city will become outdated by the
time they complete the phased replacement program. Mr. Reedy agreed, stating they
are proposing the city increase its line replacement budget from $920,000 to
$3,069,000 in 2006/2007. He said their goal is to get ahead of aging pipes and to
accomplish replacements prior to the time failures occur. Councilmember Clark asked
if extending the replacement period to 15 to 20 years would make a substantial
difference. Mr. Reedy explained extending the replacement period increases costs
associated with catastrophic failures. Councilmember Clark pointed out the projected
rehabilitation costs are conceptual and could vary between —30 percent to +50 percent.
Mr. Reedy agreed, explaining the projections were based on their current
understanding of the piping network. Mr. Reedy noted the city could benefit from
economy of scale by combining sewer system, water system and street replacement
projects.
Mayor Scruggs asked if staff is considering a bond election or other form of creative
financing. Mr. Reedy said, while staffs recommendation is to do a bond election, other
options are available.
Mr. Bailey reviewed the Sanitary Sewer Assessment study, stating it identified the large
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number of unlined concrete sewer pipes, C-MOM regulations, and insufficient depth of
pipe to serve expanded service area as current problems. He said recommended
solutions include the implementation of a sewer rehab program phased over 10 to 15
years, lining or relining deteriorated pipes, and constructing new relief and outfall
gravity sewer lines to serve expanded service areas. He said the cost of improving
unlined sewer areas is estimated to be $8.9 million. Mr. Reedy stated staff is also
recommending the city increase its sewer line replacement budget from $670,000 to
$1.6 million per year beginning in 2006/2007.
Councilmember Clark asked about the clay used in the pipes. Mr. Reedy said they use
a vitrified clay pipe that is very similar to porcelain, noting they anticipate the pipes to
last 100 years or longer. He explained future problems with the pipes will center
primarily around the joints. Councilmember Clark asked if the city could install
oversized pipes to allow for future capacity increases. Mr. Reedy said, while it sounds
like a good idea, oversized pipes do not work well and contribute to hydrogen sulfide
production.
Mayor Scruggs noted the Black and Veatch study lists about 3,500 more water
accounts than sewer accounts. She asked if those 3,500 accounts represent residents
on septic systems. Mr. Reedy responded yes and a few outside the city customers.
Mayor Scruggs noted the plan projects a 21 percent increase in water demand, but only
a 6.5 percent increase in sewer system demand. Mr. Reedy explained most of the
city's water demand is attributable to irrigation or evaporation from swimming pools and
evaporative cooling systems. He said their projections are based on January, February
and March consumption figures when 90 percent of water flow is assumed to go down
the drain. Mayor Scruggs pointed out sewer rates are based on water rates, asking if
the water rate increase will, in fact, result in a sewer rate increase. Mr. Reedy
responded no, explaining the sewer rate is based on water consumption, not the billed
amount.
In response to Vice Mayor Eggleston's question, Mr. Reedy stated the 2003 sewer rate
for a single family is $1.83 per thousand gallons, plus a $5.10 monthly charge. He
explained the proposed rate increase would raise the cost to $1.91 per thousand
gallons, plus a $5.10 monthly charge. He explained the $5.10 monthly charge covers
meter reading and billing costs. He noted a customer's average sewer flow totals 9,000
gallons per month.
Councilmember Clark asked if the city imposes a minimum monthly charge. Mr. Reedy
said the minimum per gallon rate was eliminated in 2001.
Mayor Scruggs voiced Council's consensus to consider the rate increase from $1.83 to
$1.91 per thousand gallons at a regular city council meeting.
Councilmember Clark asked how much impact future development had on staffs
recommendation and if they will be proposing ways the city can recapture some of
those costs. Mr. Reedy explained the rate structure has tiered amounts based on
consumptive use and is designed to have each class recover its cost. He said the
overall impact of future development on staffs recommendation is negligible, stating
the majority of the city's problem is related to the lack of existing reserve capacity and
the future loss of groundwater capacity.
In response to Mayor Scruggs's question, Mr. Reedy stated the city has not done a
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water rate increase since 1993. He explained impact fees have been used to capture
growth costs.
Councilmember Clark recommended the city reconfigure the bill so that residents better
understand it includes charges for water, sewer and sanitation.
Councilmember Martinez asked if the city could provide an average monthly billing
program similar to those offered by APS and SRP. Mr. Reedy explained most
customers are better off paying their monthly bills as received, stating the amounts paid
during low usage months are often considerably higher than the lower amounts paid
during high usage months. He said average bills also create collection problems when
people move.
Mayor Scruggs asked why they used such a high interest rate on the bonds. Mr. Lynch
explained the interest rate was based on 20 years in the future. He noted the city's
bonds are currently in the 5 to 5.25 percent range.
Mr. Boonhower discussed the impact of the development impact fees. He explained
they are recommending the water development impact fee for a residential connection
be increased to $3,500, but that no change be made to the sewer development impact
fee. He noted there have been no increases in the water rate since 1993 and the
sewer rate remained unchanged from 1993 until 2002.
Mayor Scruggs asked if the city absorbed a greater increase in demand during that 10
year period than it will likely have in the future. Mr. Boonhower said, while increased
development impact fees and additional growth have helped offset the increased costs,
the system has had some financial deterioration over the past several years.
Mr. Boonhower reviewed a chart reflecting the impact the proposed increase would
have on an average customer's monthly bill. He reiterated some of the increases
proposed in later years are dependent upon demand reaching expected levels. He
said the annual increases in the total bill for water and sewer will be less than inflation.
In response to Mayor Scruggs's question, Mr. Reedy clarified the proposed rate
increases are necessary to proceed with the first three projects and rehabilitation of the
water and sewer systems.
Mr. Boonhower clarified their proposal is to increase residential impact fees to $3,500,
however, commercial impact fees are significantly higher. He said they have not yet
looked at what percentage of the cost will fall on commercial development, therefore,
residential impact fees could be slightly lower or higher.
Councilmember Clark asked for additional information on the percentages allocated to
residential and commercial developments. She said it would also help to know how
much of the rate increase is attributable to the rehabilitation that needs to be done.
Mayor Scruggs stated only one area of the city is growing, pointing out the General
Plan for that area calls for 30 percent residential and 70 percent non-residential uses.
She said, therefore, the increase in demand has to be driven primarily by commercial
uses. Mr. Reedy noted staff will go through an analysis to show exactly what the rate
impacts will be for every class of customer. He said that analysis will be brought back
to Council during the budget process. Mayor Scruggs clarified the recommendation is
for a four percent increase in revenue across the system, not specifically for a four
percent increase for residential customers. Mr. Reedy stated, however, the ultimate
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rate increase for residential customers will likely be somewhat lower than four percent.
Councilmember Martinez asked why they are recommending an impact fee of $3,500
when the calculated cost is $4,930. Mr. Boonhower explained the proposed numbers
bring the total to $5,177, putting Glendale in line with what Phoenix charges in the Deer
Valley area and slightly below Peoria. He said increasing the impact fees to cover the
full calculated cost would put Glendale highest in the valley. He cautioned that, while
the Council is free to implement a full cost recovery policy, doing so could drive
development the city is counting on for revenue to other cities.
Mayor Scruggs asked staff to return for further discussion on the impact of the rate
increases on residential and commercial classes before it starts developing the budget.
She voiced Council's consensus to bring the four percent sewer rate increase forward
to a Council hearing.
ADJOURNMENT
The meeting was adjourned at 5:15 p.m.
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