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HomeMy WebLinkAboutWater Board - Minutes - 02/28/2002City Council Liaison Chuck Wanner Staff Liaison DeEtta Carr 221-6702 Water Board Chairman Water Board ViceChairman Tom Sanders 491-5448 John Morris 491-0185 Secretary Vicki Mesa Roll Call Board Present Tom Sanders -Chairman, John Morris -Vice Chairman, Joe Bergquist, Ted Borstad, Tom Brown, Bill Fischer, David Lauer, Rami Naddy and Robert Ward Board Absent Paul Clopper and David Frick Staff Present Patty Bigner, Dennis Bode, Kevin Gettig, Jim Hibbard, Beth Molenaar, Mike Smith, Dennis Sumner, Wendy Williams and DeEtta Carr Guests Present Al Jakubauskas and Gene Schleiger Meetin¢ Opened Chairman Tom Sanders called the meeting to order at 3:10 p.m. Minutes Approved Joe Bergquist made a motion to approve the January 28, 2002 minutes. John Morris seconded the motion. The minutes were approved unanimously. Gene Schleiger reported that Horsetooth Reservoir is only 42 percent full. He stated the current snow pack is at 68 percent. In comparison to previous years everything is running below average. There would need to be foot of snow per week until the middle of April to reach the normal. He gave a brief explanation of why 100% quotas are not offered. He reported the Spring Water Users meeting will be held at the Fort Collins Holiday Inn on April 10. Board members will be receiving information soon. Gene stated that Pleasant Valley Pipeline participants are getting anxious and need the pipeline to be online. He commented that there seemed to be roadblocks at every turn, primarily with the Fish and Wildlife Division. Fort Collins Water Boar( inutes PAGE 2 February 28, 2002 He gave a report on the work being done at Horsetooth Dam. He stated the Bureau is still trying to determine the proper depth of the coring and how to do it. He believed that requests for bids would be issued sometime in July. He stated the original estimate was to have Horsetooth Dam completed by the Fall, 2003 but they are hoping the time frame to be moved up so that the filling capacity could be increased by spring of next year. Gene reported they were in the process of awarding the bid for NCWCD's new office building. He stated the building would be located one mile north of Berthoud on Highway 287. Robert Ward asked if NCWCD had a drought policy, to guide the District as they set the quota. Gene stated it's done on an analysis basis and did not believe there was a written policy. He spoke of the long-range drought projections, which do not look good. Tom Brown asked how much of the current situation is due to the lack of storage at Horsetooth. Gene stated that there is enough water at present time to cover the south end. He stated the major problem was that only 550 cfs can be pulled from the west slope to the east slope and 1400 cfs can be pulled from Horsetooth. He stated their goal was to have Horsetooth at the 40,000 acre-foot level by the beginning of April. Proposed Surplus Water Rental Rates Beth Molenaar explained that each year the Water Board forwards a recommendation to City Council regarding water rental rates for the coming spring. The proposed rental rates for 2002 are based on several factors including past rental rates in the area, current assessments, and anticipated supply and demand conditions. With the exception of Colorado Big Thompson Project (CBT), Joe Wright Reservoir and Reusable Effluent, water cannot be rented from one ditch company system into another. Therefore, for these systems the rental market is limited to individuals under each ditch and the rental price is largely dependent upon assessments as well as the supply and demand within each irrigation system. This results in considerable variation in prices per acre-foot among the various supply sources. The rental prices for CBT, North Poudre Irrigation Company (NPIC), and Water Supply and Storage Company shares are based primarily on market rental rates since there is an active rental market for these shares. Typically, about 90 percent of the water rented by the City is from these three sources. With the limited rental markets for the other sources, the rental prices are based primarily on assessment rates. Tom Sanders asked if some rates have increased. Beth stated that the most significant rate increase is for Joe Wright. She stated that it is the most expensive because it is a reusable resource, a much scarcer type of water for which demand is very high and supply limited. Most of our reusable water is provided to Anheuser Busch through our reuse agreement. The remainder is in demand to satisfy state requirements for substitute supply plans. Tom Brown asked why, if demand is expected to be so much more than the available supply, staff isn't considering raising the price. This would equalize supply and demand. Beth Fort Collins Water Board mutes PAGE 3 February 28, 2002 explained that, for CBT water, the assessments an irrigator pays for the water is less than what municipal users must pay. When we rent to municipal users, we charge higher rates; when we rent to an irrigator, we are trying to match market rates. Also, we are not the only source of CBT water available to rent. Most of the people who have requested water from us have also made requests to several other entities. David Lauer asked about the margin of difference between Agricultural and Municipal rates. Beth stated that for CBT water we are paying $19.44 per unit, so if we get an 80 percent quota, we will be paying $24.30 per acre-foot. Agricultural users are charged $7.80 per unit, which would be $9.75 per acre-foot. So, in an 80 percent quota year, we pay about $24 per acre-foot and rent it for about $25 an acre-foot to agricultural users. Tom Sanders asked if we would loose money on any of the shares by renting them for less than our assessments? Beth explained that if the CBT quota is set very low then our assessment cost per acre-foot might be higher than our rental rate. Dennis Bode pointed out that the primary value of this water to the City is having the water available for our own use. Any revenue received through rental of any excess water just helps to offset the costs of owning the water. Beth stated that total rental money averaged around $300,000, but last year it was $660,000. She reported that the increase was partly due to renting 3,000 acre-feet to Platte River Power Authority (PRPA). They needed CBT water because not enough Windy Gap water was available last year, and they had to rent it from us at the higher municipal rate. The North Poudre Irrigation Company water allocation was also very low last year, and some of the municipal water under that system was made available (at municipal rates) on the rental market to their irrigators. Bill Fisher made a motion to adopt the staff s recommendation for all rates excepting the recommendation for the Water Supply and Storage Company explaining that while he did not believe he had a conflict of interest he does represent the Water Supply and Storage Company. Ted Borstad seconded the motion. The motion passed unanimously. Joe Berquest moved to adopt the Water Supply and Storage Company rates. The motion was seconded by David Lauer and passed unanimously with Bill Fisher abstaining. Power Point Presentation - Bottled Water Kevin Gertig gave a power point presentation on the bottled water industry. He commented that the Conservation and Public Education Committee has been investigating bottled water as a possible revenue source as noted Fort Collins water quality surpasses most bottled water on the market. He reported on case studies performed in three major cities that bottled their own water. He mentioned that the reasons for bottling water include public relations, economic development or in case of loss of service (emergency). Advantages included: • Marketing tool 0 Revenue generating (which may require a change in the City Code) Fort Collins Water Board lutes PAGE 4 February 28, 2002 Disadvantages included: • Cost and risk involved • May not be profitable • Competitive market • Legal • Water quality issues/concerns He responded to questions noting that the three cities in the studies water price per bottle was competitive with products on the market. He stated he was not aware of any City in Colorado bottling its own water. Ted Borstad stated that Pepsi -Cola bottles water from seven different municipalities around the country and puts it own label on the product. He stated that the water comes directly from the tap. The Board determined that the issue should be discussed further by the Committee before presenting it to Council. The Board thanked staff for its hard work. Fluoride Technical Study Group Update Rami Naddy spoke of public meetings recently held to gather input. These meetings were video taped and comments from the public were transcribed. The main concerns were: accumulative amount of fluoride received, legal authority of the City to add fluoride, fluoridation without representation and health effects of fluoride. He gave a brief explanation of the criteria used to determine whether items are `first tier,' `second tier' or miscellaneous materials. He explained that the Technical Study Group will be focusing on six issues: efficacy of drinking water and fluoridation, risks of drinking water and fluoridation, cumulative exposure, cost benefit analysis, alternative methods of fluoridation, public individual choice. He stated that the top findings would be discussed at the next meeting as well as identifying areas that need further research. The Board discussed how the report would be presented to the public. Rami stated there would be another public meeting in June or July to present their findings. Staff Reports Treated Water Production Summary Dennis Bode Committee Reports Legislative, Finance, Liaison Issues - Robert Ward stated they had not met. He mentioned proposed legislation that deals with water issues, including a bill that would let individuals own instream water rights. He stated that he was aware of the Construction Fund Bill but did not know the particulars. Fort Collins Water Board _ _nutes PAGE 5 February 28, 2002 Conservation and Public Education - David Lauer stated they were meeting to discuss water bottling issues, conservation and irrigation efficiencies at the March meeting. Other Business Tom asked for ideas for the Tri-City water meeting. He asked the Board to make suggestions for a speaker for the meeting. Adiournment The Bo e ' urned at 4:54 p.m. Tom Sanders, Water Board Chairman DeEtta Carr. Water Board Liaison