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HomeMy WebLinkAbout04/29/2003 Adjourned Meeting 358 CITY OF YAKIMA, WASHINGTON ADJOURNED MEETING OF THE CITY COUNCIL APRIL 29, 2003 - 7:00 P.M. YAKIMA VALLEY MUSEUM • 1. ROLL CALL Present: Council: Mayor Pro Tem Paul George, presiding, Council Members Clarence Barnett, Lynn Buchanan, Larry Mattson, John Puccinelli, and Bernard Sims Staff: Dick Zais, City Manager; Dueane Calvin, Water /Irrigation Manager; Dave Brown, Water Engineer; and City Clerk Roberts' Absent: Mayor Mary Place (excused) 2. PRESENTATION OF UPDATED FUNDING OPTIONS FOR THE IRRIGATION CAPITAL PROGRAM • City Manager Gives Opening Remarks City Manager Zais opened the meeting by giving a brief overview of the two options that have evolved since the previous public meetings as a result of continued deliberations, public input, creative financing, and philosophical changes. o Rebuild the 308 System - with a financing.package that includes a 30 -year revenue bond issued by City Council. There is also a proposal to include the use of Community Development Block Grant funds. The reason bonds have to be used is that irrigation is a utility that doesn't qualify for Public Works Trust Fund dollars. What didn't come out at the last public meeting is that the current irrigation ordinance allows someone to opt out, to withdraw from the system based on changes in their circumstances. To sell bonds for a repair or rebuild requires having certainty with regard to the ratepayers paying for the bond. The City will be providing one last chance to withdraw from the irrigation system before bonds would be sold. He expects some individuals will choose to opt out from the irrigation utility. Another possibility would be to rebuild the 308 system where the most severe problems exist, and rebuild the non -308 system with a financial package put together over time. It's the 308 system that is the most critical and has to be rebuilt or converted within ten years or less to satisfy the legal agreement with the Acquavella water rights litigation. We no longer have certain water flow guarantees in light of that settlement. It will take a number of years to design and build whichever choice is made. o Convert the 308 System to domestic water, rebuild the non -308 system, and build a new treatment plant for domestic use. The source of funds would be the ratepayers of the entire city that currently use the domestic water system. The previous option used a rate based on members of the current irrigation utility less those who chose to withdraw. He mentioned that Nob Hill Water customers are APRIL 29, 2003' 3 5 9 not included in this cost because they are not part of the domestic water service. Another provision with this option is the domestic water system is eligible for low interest Public Works Trust Fund loans and that affects financing. These financing options also have a portion of the Community Development Block Grant Funds, being deliberated by Council. Although they have already made choices for use of those funds, that could be changed. We have made the recommendation that these funds could be used in both options, but it must be on a targeted basis for eligible property owners that meet criteria within the block grant. The funds cannot be used to pay debt on bonds. They must actually be used to contribute funds toward individual property owners. Earlier, we were estimating the average cost at nearly $33 every two months of billing for the rebuild choice based on different financing expectations and costs; in the reassessment and financing packaging, that is lowered to an amount closer to the conversion option. There is also a philosophical issue with the aquifer storage recovery (ASR) concept. That would mean more domestic capacity needs being met by wells (groundwater) rather than surface water. If that choice were made, in the rebuild option the City would not add a new water treatment plant, but would focus on well construction and additional enhancements on water treatment. • Dave Brown, Water & Irrigation Engineer, gives details o Ground water versus surface water - the City has a variety of different water rights, both ground and surface. The Nelson system that currently serves 308 irrigation customers is where we would build a water treatment plant to serve current and future users. Along with groundwater, we could drill wells for aquifer storage and recovery. During the non -peak times we would take drinking water, store it in the ground, and pump it out when we need it. There have been some changes in the laws that allow this process to be more easily accomplished. This is where we could get future water. • o Option la - Rebuild and refurbish all the irrigation systems. If your water comes from a system that isn't from the City of Yakima, nothing will be done with it. This option would rebuild the complete General 308 system. The Non -308 system would be refurbished and brought up to standards. He clarified again that if you are not part of the 308 or non -308 general system, this option doesn't affect you. He also explained that the costs shown on the charts are increased costs, above what are paid today. The individual costs, averaged on a lot size of 8,852 square feet, would go up approx $11.95 every two months; a 7,000 square foot lot would increase $9.45 every two months. o Option Ila - Convert only the 308 system to drinking water. Because it is in the worst shape it must be replaced or converted. In this option, we would abandon the 308 irrigation system and build a new treatment plant at Nelson. Ratepayers would stop paying irrigation fees, their domestic water bill would increase by $8.45 every two months to pay for the treatment plant and service meters, and then they • 2 360 APRIL 29, 2003 would pay for irrigation usage on their drinking water bill rather than through an irrigation bill. That amount would be dependent on use, determined through the water meter. Once converted to drinking water for irrigation the sewer bill would be based on drinking water used only during the winter months to avoid paying sewer charges on irrigation water. For the non -308 customers, we will refurbish their system and bring it up to standards. Their drinking water bill will go up $8.45 every two months to pay for the treatment plant and improvements. To finance and pay for the refurbishment of the non -308 system, the bill will go up $7.46 every two months on an average lot size. The last group consists of the balance of the drinking water system users; their bill will go up $8.45 every two months and that is their only change. The fee for the rebuild option last time was $32 every two months, now it's $11.95. The fees for the other options haven't changed from the last time. Dueane Calvin, Water & Irrigation Manager, clarified a question concerning meters. If the 308 - system is rebuilt, irrigation delivery would not be metered. The meters would only be required on the conversion option to domestic water for irrigation. City Manager Zais emphasized that the important things are cost and quality of life issues and what we want to see happen for the future. This is a long term, 50 to 100 years, decision. That is part of the significance of Council's deliberation. It's a lot of money and there are significant cost obligations and responsibilities to all ratepayers and there are regulatory and legal risks involved in either choice. • Mayor Pro Tem George opened the public meeting Alonzo Marquez, 613 N 3rd Street, believes the costs would go up much more than the charts are predicting. He would expect it to be at least ten times what he uses - now. He is for Option A. Phil Small, President of Land Profile, Inc. in the Larson Building, summarized a conversation he had with Steve Rolph, Water Conservation Field Services Program Coordinator, for the US Bureau of Reclamation. It was Mr. Rolph's contention that the City has substantial opportunities to seek state and federal funding to rebuild the irrigation system. The four most important points of Mr. Rolph's, relayed by Phil Small were: 1. Washington Department of Health has been using Referendum 38 money to fund urban irrigation conservation measures in western Washington. He feels that the use of Referendum 38 monies to rebuild Yakima's irrigation is consistent with the intent of Chapter 43.99E (RCW). 2. The US Bureau of Reclamation can request federal funding to operate under reclamation law. The City has water rights of 6,000 acre feet supplied through the Warren Act. He thinks that under bureau policy the use of more than 2,000 acre feet per year requires preparation of a water conservation plan; however it also • qualifies for 50% funding of the cost of plan preparation. If the Bureau approves 3 APRIL 29, 2003 3 61 the water conservation plan then the Bureau can submit a budget request for federal funding to rebuild the irrigation system. Because reclamation law doesn't strictly require matching funds, the potential benefit is significant. 3. Landscape irrigation accounts for between 65 -75% of municipal water use in Steve's region of responsibility and he feels segregation of our water supply provides the opportunity to control that supply. Conservation methods to control supply are more effective than measures to control demand. 4. There are water reclamation professionals working with a lot of urban communities to reuse wastewater for irrigation. Mr. Small said that Mr. Rolph's other responsibilities have kept him from talking with City staff but that he has a working knowledge of the City's problem. He said when. City staff meets with Mr. Rolph they should expect him to explain how funding is available, and how he believes the City should request it. He will explain the legal basis for water conservation responsibilities under federal law, the funding we can request, and the potential damage to the Warren Act water right if we don't comply. He will also explain why a segregated system is highly preferable for water conservation. Mr. Small not only advocates the rebuilding of the irrigation system but also extending it to those residential lots not currently on the separate irrigation system. Council Member Mattson asked Mr. Small his perspective on the regulatory environment, at the federal level. He said he sees the trend to increase the heavy handedness by the federal regulatory agencies and the laws, going for greater control of our system and less local control. He used the Endangered Species Act as an example. Mr. Small responded that it's a complex balancing act as to what you try to protect. Keep the ground water and surface water clean so it doesn't burden the end user with heavy treatment requirements. Bev Luby Bartz, 114 North 7 Street, asked questions about the 1996 "pay- as -you- go" financing plan. She recommended rejecting all these plans to go back to the pay - as- you -go finance plan and getting the job done. City Manager Zais explained that the decision made when the utility was formed was critical for the city. The utility was not allowed to consolidate all these districts until the law was changed. It was done in 1997. The concept of pay -as- you -go has been used to make improvements from the resources collected over that period of time. But now we're talking about a $20 million project. It would take approximately forty years to collect the entire amount of resources necessary to do the full rebuild of the systems. We only have a ten year timeline, hence the accelerated schedule. It cannot be done the way she suggested. Mrs. Luby Bartz said she thought we could have gotten an extension if we had shown good faith in getting these repairs done previously. Mr. Zais explained that this settlement is with the federal government, the State Department of Ecology, and the City of Yakima with passiveness on the part of Yakama Nation who didn't contest it. They are not going to accept an extended timeline. Randall Leofsky, 2607 Barge Street, claimed using treated water for irrigation is like salting your plants. He loves the separate irrigation system as he's an avid gardener. He spoke in favor of Option la, keeping the systems separate. 4 362 APRIL 29, 2003 • Paul Franklin, 1526 Roosevelt Avenue, questioned the projected cost of the water per customer with Option Ila. Dave Brown reviewed the numbers that have been obtained on 19 different residences in the general irrigation system. Mr. Franklin also asked what degree of hassle will there be for those in the 308 system to convert to domestic if their current irrigation water comes from the back of the house (alley) now. Will there be large costs to the customers that are not included in this documentation? Mr. Brown talked about the plans to change the service line from the main in front of a house through the meter (new) clear to the edge of the house because they are inadequately sized today. Although there may be costs to some homeowners, some of the cost wouldn't be there at all to some homeowners, including restoring the yard back to the current condition. Council Member Buchanan clarified that the cost to go to the house would be covered but anything beyond the house would be at the expense of the homeowner. Crystal Marey, 226 South 14 Avenue, said that her friends who currently use domestic water tell her they use more than the amounts the City is projecting; therefore, she questions the City's accuracy. She also expressed concern about using treated water on her yard. Phil Pleasant, 1202 Fair Avenue, suggested the City Council look at options that would allow local people to do the work of rebuilding the irrigation system rather than bidding it out. He thought they should be able to work off their irrigation costs that way. Marcia Garcia, 1405 Cherry Avenue, expressed concern about what it is going to cost and the hardships the expense will create. Albert Hull, 412 South 14 Avenue, mentioned the potential need for backflow preventor devices and the additional expense to the residents for them. He spoke about the mess that will be created by having to dig up the streets to fix the irrigation system. Council Member Puccinelli described a method of putting in new lines using pipe bursting and how that may alleviate some of the mess. Onni Perala, 1425 South 32 Avenue, said there is no agency that will give millions of dollars to help put in a new irrigation system. But, if we don't put the money into some kind of improvements now, ten years down the road there will be no system. His comment was that we need to get on with the program even though it's going to cost. He shared that he paid about three times as much for water in Boise for the same size lot he has here. But in Boise they also have added maintenance to the operational costs and do replacements. Yakima's charges do not cover replacement costs. Council Member Buchanan refreshed everyone's memory about how ten years ago the City Council said we've got to do something about irrigation on the east side and spent $600,000 of CBDG funds replacing irrigation water mains. He claimed that if we had kept that up that would be over $6,000,000 that would have been used to date to replace mains. Ken Montgomery, 3604 Messina Drive, said he was in the irrigation business until he retired and is now in the nursery business and sees what water quality does to plant material. His nursery is on Nob Hill Water and they buy products to try to buffer the 5 APRIL 29, 2003 3 6 3 chlorine and other materials in the water. The proposal has been to install a valve or frost -free hydrant in each yard with an anti - siphon piece threaded on to that. If there is to be a new delivery in the front yard, the owner would have to dig up his yard and hook up to it bypassing any safety devices that were provided. He liked the idea of wells being incorporated into the system as that would be a safety issue considering the terrorist activities over the last year and a half. It would be easy for someone to go out to the river and affect our water but a well is nearly impossible to contaminate. Water rights will continually be challenged over the years. The answer is conservation, improve irrigation, and you cannot do that with a frost -free hydrant that encourages hose watering. Hose irrigation, at best, is 25% efficient, compared to in- ground water that is 90% efficient. A separate irrigation system allows much better management and the ability to deal with conservation throughout the year. Alice Creighton, 212 North 8 Street, commented that during all four of the public meetings she has not heard anyone besides Council members speak favorably of converting to potable water. She asked about the second water treatment plant and whether it would be used for only half of the year. Dave Brown said that was correct. We're tied to that length of time because of the period use of the water right, April 1 to October 15 She supported Option Ia. Steve Myers, 1120 Cherry Avenue, also said that he hasn't heard anything that supports converting to domestic water. Everything he has heard says the citizens want to keep the irrigation water separate. He asked about the existing system and pipe size. Dave Brown said the mains existing in the street today are adequately sized for the irrigation system because they were sized for fire flow. Mr. Myers said he is in favor or rebuilding the existing irrigation system and is willing to pay more to get that option. In response to comments made by Mr. Myers about funding, City Manager Zais reiterated that Federal Block Grant dollars are part of both options. He said the conversion to domestic water qualifies for low interest Public Work Trust Fund dollars. A number of state and federal funding sources have been investigated and we have been told we are ineligible. The exception is the Block Grant dollars we get locally. We are continuing the search and if there are any possible resources that emerge from state or federal funds, a financing package could possibly reduce the costs to ratepayers or be used to reduce the bond term. Council Member Mattson offered that he is leaning towards the conversion option and gave his reasoning. He said Mr. Perala brought up a good point about the true cost of water in the American west today. In Boise he paid three times the cost he pays in Yakima because it included replacement and maintenance as well as operation costs. If we were to think that way, these figures need to be boosted. He said he has studied water history and in the last 100 years few things are more heavily subsidized than irrigation water. Unfortunately, when there are subsidies the true cost is never known. That is why he is leaning toward converting to domestic water. He is looking fifty years into the future and doesn't see irrigation being available to any city; it will be a thing of the past whose time has come and gone. He is in favor of eliminating that subsidy. Eleanor Ficele, 921 South 24th Avenue, referred to the increases implemented in 1998 that were intended for rehabilitation and reconstruction. The 1998 increase was based on an average rate for all the systems. Even though her system was in good repair, she accepted the increase. However, this is an additional large increase and many citizens on fixed incomes cannot afford it. She encouraged Council to explore all 6 364 APRIL 29, 2003 • possible options for funding. She emphasized that the City needs to do thorough planning so they don't have to go through this again two years from now. Freya Burgstaller, 1507 Belmont Avenue, questioned some of the calculations on the hand outs and ultimately supported Option Ia. Betty Gaudette, 701 North 6th Street, favors Option la. She thinks there can be more CBDG funds used on this project than shown on the handouts. MATTSON MOVED AND SIMS SECONDED TO ADJOURN THE MEETING. The motion carried by unanimous voice vote; Place absent. The meeting adjourned at 9:05 p.m. / 1 / READ AND CERTIFIED ACCURATE BY: 0' C' UNCIL MEMBER ATE /jOIPP • • CIL MEMB - D A ATTEST: () K-�- / CITY CLERK - - Paul Georg- MAYOR PRO TEM Minutes prepared by Linda Watkins. An audio and video tape of this meeting are dvaii in the City Clerk's Office 7