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HomeMy WebLinkAbout2011 05-09 City Council/Manager Workshop Packet AGENDA MAPLEWOOD CITY COUNCIL MANAGER WORKSHOP 5:15P.M. Monday,May 9, 2011 Council Chambers, City Hall A.CALL TO ORDER B.ROLL CALL C.APPROVAL OF AGENDA D.UNFINISHED BUSINESS 1.5:15 p.m. – Candidate Interview a.Business & Economic Development Commission 2. 5:30 p.m. – Wipers Recycling v. City of Maplewood a.Declaration of Intent to Close Meeting for Attorney Update E.NEW BUSINESS 1.Water System Evaluation Summary F.ADJOURNMENT * Times Listed Are Approximate THIS PAGE IS INTENTIONALLY LEFT BLANK Work Session Agenda Item D1 AGENDA REPORT TO : James Antonen, City Manager FROM: Charles Ahl, Assistant City Manager Sarah Burlingame, Senior Administrative Assistant SUBJECT: Commission/Board Candidate Interview a.Business & Economic Development Commission DATE:May 4, 2011 INTRODUCTION The City Council will be conducting an interviewof a candidatefor the Business & Economic Development Commission. One (1) isseat open on the Business & Economic Development Commission (BEDC) which was created by a resignation, thereforethe individual appointed to this commission would serve the remainder of that termwhich expires September 30, 2013. th This is a new resignation and not a continuation of the interviews that took place on April 4and th 25. The applicant, Karen Anderson, applied for the BEDC during the recent interview process but was unable to interview at that time. RECOMMENDATION Staff recommends that the Council interview the candidate as indicated in the schedule below. The questions will be submitted to the Council under separate cover.During the interview process, Council Members should fill out their ballots. Once the Interview hasconcluded, Council Members should submit their ballots to staff, which will be tallied with the results brought back to the Council regular meeting following this workshop with recommendations for appointments. The schedule is as follows: Business Economic Development Commission (1 opening) 5:15 PM Karen Anderson Attachments: 1.Candidate Applications Work Session Agenda Item D2 AGENDA REPORT TO : City Council FROM: Charles Ahl, Assistant City Manager SUBJECT:Wipers Recycling v. City of Maplewood a.Declaration of Intent to Close Meeting for Attorney Update DATE:May 9, 2011 INTRODUCTION As part ofthecontinuing discussion on litigation matters related to the lawsuits regarding the Wipers Recycling v. City of Maplewood issues, the City Council will be receiving an update from Attorney Robin Wolpert regarding the status and progress on the various litigation matter including a discussion on settlement offers. It is expected that due to the litigation decisions and update on client-attorney issues, that this meeting will be closed per statute. Recommended Action The City Council will receive the update during the closed session. No action will be taken during this closed session. THIS PAGE IS INTENTIONALLY LEFT BLANK AGENDA REPORT TO: James Antonen, City Manager FROM: Michael Thompson, City Engineer/ Dep. Public Works Director SUBJECT: Water System Evaluation, City Project 10-09, Project Update DATE: May 2, 2011 INTRODUCTION On April 12, 2010, the council authorized the preparation of a water system evaluation report. The purpose of this report was twofold; to evaluate the city’s current water surcharge rates, and determine whether improvements should be made in the way that the city provides water service to its residents. The consultant team has completed a draft of the report and they are prepared to present their findings and recommendations. A copy of the draft report and the slides for the presentation are attached. BACKGROUND/DISCUSSION St. Paul Regional Water Services (SPRWS) currently provides water service to a majority of the residents and commercial properties within Maplewood. North St. Paul provides water service to residents in the northeast corner of the city, and Roseville, Little Canada, and Woodbury also provide water service to properties located along city borders. Maplewood transferred ownership of its water system assets to SPRWS in 1997. As a part of this change, SPRWS assumed ownership and maintenance of the existing water system and Maplewood eliminated the need for utility billing since SPRWS took responsibility for both water and sanitary sewer charges for the community. A copy of the agreement between the Board of Water Commissioners and the City of Maplewood that established the terms of this ownership transfer is attached. As a result of some of the inherent challenges associated with an outside agency owned water system, staff has questioned whether SPRWS ownership and maintenance of the water system is still in the best interests of Maplewood and its residents. The water system evaluation study has evaluated both the engineering and financial aspects of how the water system is currently operated and provides information to assist the city in evaluating possible changes in the way that water service is provided to the community. Maplewood currently collects a water surcharge fee from all residential and commercial water accounts serviced by SPRWS and the City of North St. Paul. The consultants previously completed an analysis of the water surcharge fees and this information was provided to the council at a work session on July 26, 2010. In response to this information, the SPRWS surcharge fee was increased from 2% to 4% for 2011. No changes have been made to the North St. Paul surcharge rate. RECOMMENDATION No action is required. The staff and consulting firm will be providing the city council with an overview of the consultant team’s findings and solicit comments before the study is finalized. The staff has coordinated with SPRWS on the study and SPRWS representatives will be represented at the work session to present their perspective. Attachments: 1. Draft Report without attachments ( A full copy of the complete report has been provided to all Council members.) 2. Presentation Slides 3. Agreement between Board of Water Commissioners and City of Maplewood WATER SYSTEM EVALUATION FOR CITY OF MAPLEWOOD CITY PROJECT 10-09 Kimley-Horn and Associates, Inc.I hereby certify that this plan, specification 2550 University Avenue Westor report was prepared by me or under my Suite 238Ndirect supervision and that I am duly St. Paul, MN 55114Licensed Professional Engineer under the (651) 645-4197laws of the State of Minnesota. Signature: __________________________ Chadd B. Larson, P.E. Date: __________ Lic. No. 4 1864 WATER SYSTEM EVALUATION CITY OF MAPLEWOOD CITY PROJECT 10-09 TABLE OF CONTENTS Page 1.INTRODUCTION 1 2.EXISTING SYSTEM INVENTORY 1 3. CAPITAL IMPROVEMENT PLAN 2 4. SURCHARGE ANALYSIS 3 5.WATER SYSTEM ACQUISITION 5 A.Initial Costs B.Annual Costs C.SPRWS Acquisition Cost D.Financial Analysis E.Rate Comparison 6. ADDITIONAL CONSIDERATIONS 9 7. SUMMARY AND RECOMMENDATIONS 10 APPENDIX A – EXHIBITS Exhibit 1 – Existing Water Main System Exhibit 2 – Existing Water Main Age Exhibit 3 – 5-Year Water Main CIP Exhibit 4 – St. Paul Water Fund – Current Status Exhibit 5 – St. Paul Water Fund – Recommended Rate Increase APPENDIX B – 5-YEAR CIP FOR WATER MAIN IMPROVEMENTS APPENDIX C – PROJECT UPDATE MEMORANDUM – SURCHARGE ANALYSIS APPENDIX D – WATER UTILITY ACQUISITION ANALYSIS -2863(9'8-32 On April 12, 2010, the Maplewood City Council authorized the preparation of a water system evaluation report. The purpose of this report is twofold; to evaluate the city’s current water surcharge rates, and determine whether changes should be made in the way that the city provides water service to its residents. St. Paul Regional Water Services (SPRWS) currently provides water service to a majority of the residents and commercial properties within the city. North St. Paul provides water service to residents in the northeast corner of the city, and Roseville, Little Canada, and Woodbury also provide water service to properties located along border streets. Maplewood transferred ownership of its water system assets to SPRWS in 1997. As a part of this change, SPRWS assumed ownership and maintenance of the existing water system and Maplewood eliminated the need for utility billing since SPRWS took responsibility for both water and sanitary sewer charges for the community. The city is questioning whether SPRWS ownership and maintenance of the water system is still in the best interests of Maplewood and its residents. This study evaluates both the engineering and financial aspects of how the water system is operated and provides recommendations to assist the city in evaluating possible changes in the way that water service is provided to the community. Maplewood currently collects a water surcharge fee from all residential and commercial water accounts serviced by SPRWS and the City of North St. Paul. This study includes an evaluation of the city’s current surcharge fees and provides recommendations for future changes in the surcharge rates. This report assumes that no changes would be considered for the Maplewood businesses and residents that are currently served by North St. Paul, Little Canada, Woodbury, and Roseville. The overall number of properties served by these neighboring communities is minimal and costs to convert them to the Maplewood system would be prohibitive. )<-78-2+7=78)1-2:)2836= The majority of the city’s water system is currently owned and maintained by SPRWS. The cities of North St. Paul, Woodbury, Little Canada, and Roseville provide water to a limited number of accounts. The following is a summary of the number of accounts served by each water service provider: SPRWS9,663 Accounts North St. Paul794 Accounts Little Canada66 Accounts Woodbury27 Accounts Roseville5 Accounts 1 The existing SPRWS water system within Maplewood consists of cast iron, ductile iron, and PVC water main. An approximate summary of the existing SPRWS water main infrastructure in the city is provided below. Water Main TypeTotal Length Ductile Iron500,000 Feet Cast Iron350,000 Feet PVC 15,000 Feet Total865,000 Feet The SPRWS system includes three booster stations to provide adequate water pressure to certain areas of Maplewood. These booster stations are located on Beebe Road, Mailand Road, and Roselawn Avenue. All three of these booster stations were constructed in the 1970’s as detailed below. Booster StationConstructed Beebe Road 1973 Mailand Road 1978 Roselawn Avenue 1978 SPRWS also has three water storage facilities in Maplewood as follows: Storage FacilityCapacityConstructed Cope Avenue1.5 million gallon 1978 Ferndale Street1.0 million gallon 1987 Sterling Street0.5 million gallon 1988 These water storage facilities require some periodic maintenance including a complete painting approximately every 15 years. A map of the existing SPRWS Maplewood water system is provided as Exhibit 1 in Appendix A. Exhibit 2 in Appendix A illustrates water main age and details the locations of historic water main breaks within the system. '%4-8%0-1463:)1)2840%2 The condition of the existing SPRWS water system infrastructure has been evaluated and a 5-year capital improvement plan (CIP) has been developed to identify future water system improvement needs in Maplewood. The CIP has been prepared based on the following: An understanding of Maplewood’s proposed street reconstruction program over the next 5 years 2 A review of the existing water mains within the proposed street reconstruction areas to determine the need for water main replacement We have assumed that any cast iron water main would be replaced at the time the streets are reconstructed to avoid future water main breaks within new street pavements We have assumed that all new water main would be upgraded to a minimum 8- inch diameter Current SPRWS policy does not provide funding for water main replacement work unless certain criteria are met regarding frequency of water main breaks. We have reviewed the number of water main breaks within the proposed street reconstruction areas to determine when the break criteria are met and when SPRWS would provide funding for the water main replacement. The SPRWS break criteria are not met for a majority of the proposed water main replacement work requiring Maplewood to provide an alternative funding source. Assuming that the city implements all of the street reconstruction work included within the 5-year CIP, approximately 6,000 feet of water main replacement will be required each year. This equates to approximately $500,000 in city funded water main improvements annually. For reference, this level of investment is generally consistent with the water main replacement work that has been performed on an annual basis within the city over the last 10 years. For the purposes of future planning, we have also assumed that subsequent 5-year CIP’s will also include a $500,000 annual investment in water system improvements. We understand that the city anticipates a reduction in street reconstruction work in the future; however, we have assumed that inflationary costs would offset this reduction in work. Since the original CIP analysis was completed, we understand that the City is planning to decrease the amount of infrastructure improvements planned for the next five years. The reduction in infrastructure improvements will likely reduce the water system annual investment to $350,000-$400,000. This reduction in water main infrastructure improvements will impact future City decisions on surcharge rate increases. Attached Exhibit 3 in Appendix A illustrates the city’s 5-year CIP for street reconstruction work and the areas requiring water main improvements. Appendix B includes a technical memorandum dated June 17, 2010 that provides additional details on the establishment of the 5-year CIP. 796',%6+)%2%0=7-7 Maplewood residents are currently billed for their water service directly by their water provider. The SPRWS and North St. Paul bills include a Maplewood surcharge to provide some city funds for water system related costs. 3 Maplewood uses two funds for surcharge revenues related to water sales; The Water Availability Charge Fund-St. Paul Water District (Fund 407) and the Water Availability Charge Fund-North St Paul Water District (Fund 408). As stated above, the vast majority of Maplewood residents are served by SPRWS and the majority of revenues are derived from this source. The following is a summary of each of these funds. A.St. Paul Water District Fund 407 SPRWS sells approximately 1.5 billion gallons of water per year to Maplewood residents. Water is metered and billed on either a monthly or quarterly basis, depending on user type such as residential or commercial, and is charged based on 100 cubic feet of water. SPRWS remits a surcharge of 2% of the total water bill, or approximately $100,000 on an annual basis, to Maplewood. Exhibit 4 in Appendix A provides a summary of the current and projected status of the St. Paul Water District fund. The fund shows a beginning fund balance deficit of approximately ($150,000). The 2010 budget shows an ending balance of $75,000. For the purpose of illustrating the projected status of the fund, we have assumed the following: No increase in the 2% surcharge rate resulting in continued surcharge revenue of approximately $100,000 per year CIP costs of $350,000-$400,00 per year (based on the City’s revised CIP projections) Based on these assumptions, the fund will have a deficit of over ($2.5 million) by 2020 unless other funding sources are identified for the water main replacement work included in the proposed 5-year CIP. Given the financial pressures that the St. Paul Water District Fund will continue to experience, we have completed a projection of the surcharge revenues required to bring the fund to a positive balance within approximately five to six years and then to maintain a positive balance. We are recommending an increase in the surcharge rate from 2% in 2010 to 4% in 2011, with future surcharge rate increases as illustrated in the table below. 2010 201120122013201420152016 Surcharge2%4%5.25% 6.25% 7.00% 7.75% 8.50% (%) Revenues103,400188,400257,100318,300370,800426,900487,000 ($) 4 In addition to the surcharge rate increases, we have assumed some limited bonding to 2015 and a one-time permanent transfer of $600,000 into the fund in 2016. The resulting 2020 fund balance would be approximately $900,000. Exhibit 5 in Appendix A illustrates the resulting impact on the St. Paul Water District Fund with the recommended changes. B.North St. Paul Water District Fund 408 The City of Maplewood collects $1.00 per account per month of surcharge revenue for water provided to Maplewood residents by the City of North St. Paul. North St. Paul remits the revenue to Maplewood on a monthly basis and this equates to approximately $10,000 per year. No increases are recommended in the North St. Paul District surcharge rate at this time. There are currently no planned water main improvements in the North St. Paul service area. Appendix C includes a technical memorandum dated July 16, 2010 that provides additional details on the surcharge rate analysis. The surcharge analysis information was provided to the City Council at a work session on July 26, 2010. Based on discussion at that work session, the City has increased the surcharge from 2% to 4% for 2011. ;%8)67=78)1%'59-7-8-32 One of the primary purposes of this study was to determine whether changes should be made in the way that the city provides water service to its residents. This has included an analysis of the feasibility of Maplewood purchasing the water system back from SPRWS. The following is a summary of this analysis. A.Initial Costs Disconnects and Master Meters The SPRWS Maplewood water system is currently connected to the St. Paul water system at several locations. If Maplewood took ownership of the water system, they would need to separate or meter each location where the Maplewood water main is connected to the St. Paul water system. Based on previous studies and discussions with SPRWS staff, there are approximately 40 locations where the existing water main would need to be separated or metered. For the basis of this analysis, it is assumed that 25 locations will be separated and 15 locations will require master meter installations. The 5 estimated total project costs (construction and engineering/admin) associated with these improvements are summarized below. 15 master meters @ $30,000/meter$ 450,000 25 disconnections @ $22,000/disconnection $ 5 50,000 Total Estimated Initial Cost$1,000,000 Service Meter Replacements SPRWS is currently completing a system-wide project to replace all of the individual service meters. This is a multi-year project and the service meters in Maplewood are scheduled for replacement in 2012 and 2013. The estimated total cost for the meter replacement in Maplewood is as follows: 8,067 Residential meters @ $162.25/meter=$1,310,000 1,059 Non-residential meters @ $450/meter=$ 480,000 535 Commercial/Municipal meters @ $1,325/meter =$ 710,000 Total=$2,500,000 The meter costs identified above are derived from an average of the actual contract unit bid prices received from SPRWS. B.Annual Costs In addition to the initial costs to separate the water system and replace the service meters, there are several other annual expenses that need to be considered with a city-owned water system. Operating Expenses The city would incur typical operating expenses associated with ownership of the water system. This analysis assumed that a utility clerk, utility crew chief, and three utility workers would be hired to operate and maintain the water system. In addition to the labor costs, there are also material and equipment costs included in the operating expense assumptions. These assumptions are primarily based on information provided by city and SPRWS staff. Labor Cost Utility Billing Clerk$ 60,000 Public Works Crew Chief$ 70,000 Public Works Crew (3)$ 195,000 Total$ 325,000 Material and Equipment Cost Office and Operating Supplies$ 100,000 Contractual (Engineering, Insurance, Processing) $ 2 00,000 6 Utilities (Electrical, Communications)$ 100,000 Operational and Maintenance$ 150,000 Total$ 550,000 Capital Expenses The 5-year CIP for water main improvements established a budget of $500,000 for annual capital water main improvements. The city also needs to budget for painting the three elevated storage tanks on an assumed 15-year basis. The annual cost for tank painting assumes the project cost to paint each tank every 15 years is $750,000. Annual Tank Painting Cost = (3 Tanks) x ($750,000) = $150,000/year 15 years Below is a summary of the annual capital expenses. Annual Water Main Improvements$ 500,000 Annual Cost for Tank Painting$ 150,000 Total Annual Capital Expenses$ 650,000 C.SPRWS Acquisition Cost Based on information provided by SPRWS, they have invested approximately $9 million in water main improvements since taking ownership of Maplewood’s water system in 1997. This cost was based on the following information provided by SPRWS staff: 95,976 Feet Water Main Reconstruction @ $85/foot = $8,157,960 Tank Maintenance Projects= $ 841,404 Total= $8,999,364 SPRWS has stated that, as a part of any water system ownership transition, consideration needs to be given to the current value of these improvements. For the purposes of this study, we have assumed that the acquisition cost would be $1, which was the cost SPRWS paid to Maplewood in 1997 to take ownership of the existing capital assets. D.Financial Analysis This analysis assumes that the city would use the current SPRWS water rates as a basis for establishing their water rates under a city-owned water system scenario. 7 The revenue generated from these water rates was evaluated with the expenditures previously identified. The purchase price for the SPRWS water system is an important consideration in determining the feasibility of Maplewood ownership of the system. We have evaluated the financial feasibility of a city-owned water system based on an acquisition cost of $1. The table below assumes water rates could be increased on an annual basis at an average rate of approximately 5%, which is consistent with SPRWS annual rate increases. These rate increases assume that a change in water system ownership would have little or no impact on water rates for Maplewood users. AcquisitionAverage Annual Payback Cost Rate Increase Year $1 5% 2018 If the city chose to take ownership of the water system, SPRWS would charge Maplewood for the wholesale cost to provide water to its users. SPRWS currently provides wholesale water to Little Canada and Roseville at a cost of 71% of the retail rate. This analysis assumes that SPRWS would charge Maplewood this same rate; however this rate may be negotiated in a city purchase scenario. The SPRWS retail rates per 100 cubic feet of water are shown below. YearWinter RateSummer Rate 2010 $2.15 $2.25 2011 $2.27 $2.37 E.Rate Comparison As previously mentioned, Maplewood water customers are currently served by SPRWS, North St. Paul, Little Canada, Woodbury, and Roseville. The rates these customers pay varies depending on who provides their water service. Below is a rate table that compares typical winter usage and summer usage for each of the city’s water suppliers. Water Winter Summer Supplier Rate (25,000 gallon) (40,000 gallon) SPRWS2010$70.95$121.50 SPRWS2011$74.91$127.98 North St. Paul2010$50.70$81.00 Little Canada2010$81.84$126.39 Woodbury2010$25.36$48.56 Roseville2010$76.50$119.75 Roseville2011$83.05$134.55 8 Appendix D includes a report prepared by Ehlers that provides more detail on the acquisition analysis. %((-8-32%0'327-()6%8-327 Since 1997, city staff has coordinated with SPRWS staff on all aspects of the water system, including design, construction, and funding for water system improvements. Below are examples of some of the inherent challenges and inefficiencies that city staff has observed with an outside agency owned water system. A. Differing Philosophies on Water System Improvements City staff considers all public infrastructure when considering the scope of work for street reconstruction projects. Staff reviews roadway condition, as well as sanitary sewer, water main, and storm sewer conditions. The city’s approach is to replace aging underground utility infrastructure at the time streets are reconstructed to avoid utility repairs that would require roadway patching. This includes the replacement of all cast iron water main during street reconstruction projects. SPRWS water main replacement criteria are based mainly on water main break history instead of age or material type. B. SPRWS Water Main Construction Requirements On city street reconstruction projects with water main improvements, SPRWS policy requires their crews to perform the water main construction; however, SPRWS crews do not perform the excavation or backfilling operation. The city must bid the excavation and backfill to the roadway contractor for the water main construction. As a result, both the contractor and SPRWS crews are on site during water main construction which creates some inefficiencies for water main construction. C. Invoicing Since SPRWS operates independently from the city, agreements and invoicing between the agencies occurs on a regular basis. City staff time and effort is incurred to review and process these agreements and invoices. There are some inherent inefficiencies and challenges with a public utility owned and operated by an outside agency. City staff continues to build relationships with SPRWS staff to minimize conflicts and streamline processes; however operating with a SPRWS owned water system will continue to require coordination efforts. 9 7911%6=%2(6)'311)2(%8-327 Based on the analysis completed as a part of this report, we recommend the following: A.5-year Capital Improvement Plan (CIP) The City Council should consider adopting a 5-year CIP for water main improvements. The implementation of this CIP will address city concerns regarding the need to replace all cast iron water main during street reconstruction projects. B.Surcharge Increase The St. Paul Water District Fund 407 has operated in a deficit for several years. The City Council should continue discussions from their July 26, 2010 workshop regarding the need to increase the current surcharge rate to eliminate this ongoing deficit. If the City Council adopts a 5-year CIP for water main improvements, surcharge revenues will need to increase to cover these additional costs or other funding sources must be identified for the improvements. C.Water System Acquisition This report identified a number of factors that should be considered in evaluating the feasibility of a city purchase of the water system. Acquisition Cost Initial debt o Payback duration o Initial Costs Water system disconnects o Master metering o Water Rate Acceptable rate increases o Increased City Staff Management o Facility space o Additional Equipment Facility space o Maintenance o Based on the analysis completed as a part of this study and depending on City Council policy objectives, it is financially reasonable for the city to consider the purchase of the water system from SPRWS. The City Council should consider all of the various engineering, political, and financial factors in determining how to proceed. Negotiation with SPRWS to determine the initial acquisition cost would be the first task to be 10 completed if the city elects to proceed further with the possible acquisition of the water system. 11 City of MaplewoodCity of Maplewood Water System EvaluationWater System Evaluation City Project 10-09City Project 10-09 City Council Work SessionCity Council Work Session May 9, 2011May 9, 2011 Agenda Purpose of Study Overview of Existing Water System Proposed Water System CIP Surcharge Analysis Discuss Possible Acquisition of Water System Purpose of Study Evaluate current water surcharge rates •SPRWS and North St. Paul •July 26, 2010 Work Session •Increased SPRWS rate -2% to 4% (2011) Evaluate possible changes in how the City provides water service to residents 1 Existing Water System 80% of the City’s water system is owned and operated by SPRWS North St. Paul provides water service to residents in the northeast part of the City (794 accounts) Limited properties served by Little Canada (66 accounts), Roseville (5 accounts), and Woodbury (27 accounts), and a few private wells Existing Water System Existing SPRWS and North St. Paul water mains vary in age and condition City staff prefers to replace existing cast iron water main (40 + years old) when streets are reconstructed SPRWS policy does not currently provide funding for water main replacement work unless certain break criteria are met Water System 5-Year CIP Based on: City’s street reconstruction program Condition of existing water mains within the proposed reconstruction areas +/-6,000 feet of water main replacement required each year (annual cost of +/- $500,000) Similar funding for future 5-year CIP’s No replacement in North St. Paul area 2 Surcharge Analysis Maplewood residents currently billed directly by their water provider SPRWS and North St. Paul bills include a surcharge for water system related costs Maplewood collects a 2% surcharge or approx. $100,000 annually from SPRWS SPRWS fund currently has $160,000 deficit Maplewood collects $1.00 per account per month or approx. $10,000 annually from North St. Paul Surcharge Analysis Recommended SPRWS Surcharge Rates: 2010 Actual2% ($103,400) 2011Adopted4% ($188,000) 20125.25% ($257,000) 20136.25% ($318,000) 20147.00% ($371,000) 20157.75% ($427,000) 20168.50% ($487,000) Past rates as high as 20% in 1998 No increases for North St. Paul Water System Acquisition Why Consider this Option? Differing philosophy on main replacement Simplify water main construction Reduce conflict City infrastructure managed as a whole Can we save residents money? Is it in the City’s long term best interests? 3 Impact of Water Main Repair Impact of Water Main Repair Water System Acquisition Financial Analysis Approx. 10 year break-even term assuming: •$1 acquisition cost •Rates similar to projected SPRWS rates/no impacts to residents Acquisition cost is significant factor •Agreement stipulates SPRWS compensation for depreciated value of improvements since 1997 Surcharge could be eliminated Long-term City can control water rates •Raw water purchase from SPRWS 4 Water System Acquisition Why Not Consider this Option? Initial set-up time and costs •Staff/Equipment/Materials •Billing Hardware and Software Water system modifications •Disconnects/master meters/service meters Acquisition cost (SPRWS Agreement) Additional debt/risk •Payback term Uncertainty/variables in analysis Water System Acquisition Maplewood/SPRWS Agreement Termination for cause Maplewood must compensate SPRWS for depreciated value of improvements made since 1997 5 year termination period Water System Acquisition SPRWS Coordination Study kick-off meetingMay 7, 2010 Draft report for reviewFeb. 3, 2011 Coordination meetingFeb. 22, 2011 Goal for study process to be transparent and include SPRWS 5 Water System Acquisition Other Options? Increased SPRWS investment into Maplewood system Continued efforts to improve coordination and streamline processes Change in approach to construction of new SPRWS water main Water System Acquisition Next Steps City Council input/direction Finalize report Implement recommendations/continue discussions with SPRWS Other Questions/Discussion 6 It °c 7. Agreement with -St: Paul Water Utility a. Manager McGuire introduced the staff report. b. Council member Koppen may-e-cLto au-tho- ire_ the Seconded by Mayor Bastian Ayes - all M ► XWX1-111►X PLANNING1. CMW Report E1 `Attachment 3 a. Council directed staff to bring back a report on how the ordinance of the Planning Commission reads, make changes that would allow nine members, not eleven. Also, how to define a quorum (with missing members), etc. 2. HIGHWAY 36/HAZELWOOD - WHITE BEAR AVENUE TRAFFIC a. Council directed staff to hold discussions about the traffic flow and control with newly elected representatives after the November 5th election. M ADMINISTRATIVE PRESENTATIONS 1. Reschedule First City Council Meeting in November a. Counci1member Koppen moved to hold the first_Novemb November .12. 1996 due tQ the Veteran's Day Holida3 Ll— Seconded by Councilmember Rossbach Ayes - all 2. Update on Maplewood`s 40th Anniversary Planning a. Assistant City Manager Dawson presented an update of the plans for the 40th Anniversary observance. N. ADJOURNMENT OF u ► . Karen Guilfoile, City Clerk 29 Packet Page Number 64 of 64 10-14-96