WATER/WASTEWATER TASK FORCE MEETING

MINUTES

October 28, 1999

11:30 a.m. - 1:30 p.m.

Salem Public Library - Anderson Auditorium

1) CALL TO ORDER

The meeting was called to order by Councilor Paul Wulf.

2) INTRODUCTIONS

Introductions were made, including three new members: Charlie Waters representing SNI, Ed Davis representing General Business, and Steve Travis who will represent Food Processors after the retirement of Bob House (November 1999). Members, staff, and citizens were in attendance as noted below.

3) CITIZEN INPUT

Mark Wulf, owner of an office building on Liberty Street, expressed a concern that office buildings pay sewer charges for summer irrigation water unless they install a second irrigation-only water meter to separate the water used. Office buildings have similar water use patterns as residential customers where more water in the summer is used than in the winter because of summer irrigation needs.

The sewer bill for residential customers is based on the winter use. This method does not charge a sewer bill for the increased water used in the summer for irrigation purposes as the irrigation water does not contribute to sewer use. He hopes that the City will consider a change in the billing process so that office buildings can have a similar type of billing structure as residential customers so that they don't pay sewer charges for irrigation water. Currently the only way to do this, is for the office buildings to install a second irrigation-only water meter at a significant expense.

4) MINUTES

Minutes of September 23, 1999, were unanimously approved as written.

5) SEWER RATE DISCUSSION

Jack Merritt, Assistant Finance Director, was introduced to lead a discussion paper on the Water/Sewer rate increase for January 2000 (see attached paper for details of presentation). Jack covered the following topics before presenting recommendations: Issues, Goals and Objectives, Today's Situation, How We Got Here, and Options. The staff recommended options were discussed in detail before a motion was entertained. The options were:

Option 1: New Base

Water: 6.75% per year for the period of 2000 through 2011
Then 1% per year

Sewer: 6.8% per year for the period of 2000 through 2004
8.0%/year per year for the period of 2005 through 2010
Then 1% per year

Option 2: Modified New Base

Water: 6.25% per year for the period of 2000 through 2004
7.65% per year for the period of 2005 through 2010
4.0% per year for 2010
Then 1% per year
Sewer: 5.0% per year for the period of 2000 through 2004
10.55% per year for the period of 2005 through 2009
9.0% per year for 2010
Then 1% per year

Option 3: Deferred to 1/1/2001

Water: 0.0% for 2000
7.65% per year for the period of 2001 through 2011
Then 1% per year

Sewer: 0.0% for 2000
7.85% per year for the period of 2001 through 2004
9.0% per year for the period of 2005 through 2010
Then 1% per year

Jack presented a comparison table of rate increases for Optional Plans, as well as a comparison of Debt Coverage Ratios and a monthly water/sewer bill comparison. There was in-depth discussion throughout the presentation. Staff recommended Option 1, to be effective January 1, 2000. Staff's reason for this recommendation: for nominally higher rate in early years as compared to later years it provides greater debt coverage or “cushion,” it provides lower bills in out years, and provides lower rate of increase in later years when the base amount is higher. When compared to other cities, Salem's water and sewer rates continue to be among the lowest in the region. A comparison chart of average residential rates with other northwest cities was reviewed at this time.

During Jack's presentation, Paul Eckley was introduced to review Water System Capacity Facility requirements as shown in the statistical graph he handed out (see attachment).

Diane Taniguchi-Dennis presented information on the Willow Lake Treatment Plant expansion during Jack Merritt's presentation, stating that the primary driver for expansion is the wet weather with current capacity at 105 mgd and dry weather capacity at 35 mgd. The target is to bring wet weather capacity to 185 mgd and dry weather capacity to 55 mgd by the year 2000 in Phase I, bring wet weather capacity to 240 mgd by 2007 for Phase 2, and bring it to 260 mgd with Phase 3. This program balances removing I/I at the source with increasing collection system and treatment capacity to meet the compressed time schedule for regulatory compliance. It also provides the maximum flexibility in project scheduling to handle the potential “wild card” environmental regulatory issues with the Willamette River. The funding of these “wild card” issues will need to be identified as the existing rate structure does not build capital for these issues.

Councilor Gavin Sample made a motion that Option 1 be recommended to Council for approval. Motion seconded by Charlie Waters.
After extensive discussion by Task Force Members, the first motion was replaced by a second motion: JB Summers made a motion to recommend Option 2 to Council and this was seconded by Councilor Bennett.

After more discussion, a vote was taken and the motion to recommend Option 2 to Council passed with 6 in favor and 5 against Option 2.

6) FUTURE MEETINGS

Next meeting will be November 18, 1999.

8) OTHER

Only one vacancy from City of Keizer left to fill. A letter has been sent to Mayor and Council with this request.

Chairperson Councilor Wulf stated that staff will look at Mark Wulf's suggestion for separating out metered irrigation for water usage and not sewer charges. Jack Merritt agreed it needs to be looked into.

9) ADJOURN

Meeting adjourned at 1:20 p.m.

These minutes are transcribed from notes and the tape recording of the Task Force meeting on October 28, 1999, as an overview of the meeting. They are not verbatim. The tape recorded meeting is available for review in the Office of the Public Works Director. The attachments are to the file copy only. Copies of the attachments were distributed at the meeting and by mail to those unable to attend the meeting.



Linda Nelson, Staff Assistant II
November 8, 1999

Attachments:
Attendance Sheet (file copy only)
Presentation Materials (file copy only)

Minutes approved by Task Force at their meeting of November 18, 1999.