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HomeMy WebLinkAboutWater Board - Minutes - 02/16/1990Water Board Minutes February 16, 1990 Members Present Henry Caulfield, President, Neil Grigg, Marylou Smith, Tom Moore, Ray Herrmann, Tim Dow, Tom Brown, Dave Stewart, Mark Casey, (alt.), Paul Clopper (alt.) Staff Mike Smith, Dennis Bode, Webb Jones, Andy Pineda, Jim Clark, Molly Nortier Guests Larry Simpson, General Manager, NCWCD John Bigham, Agency Coordinator, NCWCD Dorothy Huff, Observer, Larimer County League of Women Voters Members Absent Tom Sanders, Terry Podmore President Henry Caulfield opened the meeting. The following items were discussed: Minutes The minutes of January 19, 1990 were approved as distributed. Proposed Environmental Management Plan Bob Wilkinson, from the City's Natural Resources Division, presented background information about the proposed environmental management plan. The Water Board received in their packets, a copy of the internal mission statement which is being used with the City's boards and commissions. Natural Resources also prepared an external mission statement that they are using with the public. Mr. Wilkinson explained that the reason they created two is that the issues are slightly different. A list of potentially effected interests was also included in the packets. That list will be used in the citizen participation process. Another sheet addressed citizen participation. In addition, they listed the goals they are trying to achieve and the techniques they will try to use. A preliminary list of issues was included. Mr. Wilkinson brought an updated list of issues for today's meeting which he said is already outdated. The issues were broken down into the categories of land, water, air, energy, biological and over -arching issues. He sees an additional category as being city government. Under each category are conservation, limitations to development, impacts of development and urban design and construction. Water Board Minutes February 16, 1990 Page 2 Mr. Wilkinson handed out an additional packet of information which contained a list of goals and objectives with references to the land use policy plan. All of the elements came from the comprehensive plan which was developed in 1978 and 1979. Many of them have been translated into action through either the Land Development Guidance System, or they may have been met through certain implementation tactics by various City departments. What Natural Resources is currently doing with it, is trying to develop a new element to the comprehensive plan that will interface with all the other elements, including the open space plan. Mr. Wilkinson has met with various divisions and departments asking them how they think the goals and objectives apply to them; specifically where the problems lie: Are they being met? Are there any problems with the goals and objectives? Mr. Wilkinson circled the goals and objectives that relate directly to water and wastewater operations. He then explained where the Natural Resources Department is going with the proposed plan. One of the handouts was a flow chart which he used to take the Board through what the division hopes to do with the proposed plan. The process is divided into Phases I and II. Phase I is defining the problem and determining what the issues are. A major problem is that the City was charged with developing an environmental management plan in 1978 and has not yet accomplished that. When the issues are defined through the effected departments and evaluations from the public, Natural Resources, with the help of other departments and consultants, will cluster the issues based on inter -dependency. Next they will prioritize clusters for study based on: information availability, urgency, cost, staff availability, etc. They will then develop a mission statement for Phase II and seek City Council review and resolution. During Phase II, which is very conceptual at this point, they will compile an information base on issues in the sequence established by prioritization; they will analyze the information base using staff teams; they will formulate policies; they will ask for City Council review and decision; and finally, they will implement the plan. Mr. Wilkinson emphasized that through the entire process, they will be communicating with the public through open houses. At the same time, they will be returning to the effected boards at key points in the process to get feedback. They will also keep the boards updated periodically on the list of issues. Before they go to Council for any decisions they will ask for input from the boards that are affected. Tom Moore asked for a time frame for Phase I. Mr. Wilkinson said that they have set August 1990 as the target date. He stressed, however, that the process and the value of the input is more important than meeting the deadline. Neil Grigg commented that the Board will look forward to seeing what the issues are. Water Board Minute • February 16, 1990 Page 3 Henry Caulfield asked where some of the issues under water came from. Some have come from citizen groups; some have come internally from staff; and some have emerged from discussions with other City departments, Mr. Wilkinson responded. Mr. Caulfield brought up the National Recreation Area document which goes, to a great extent, into a question of "what we are not going to do with respect to water in the River," i.e. the NRA is not planning to get involved in any changes in the management of the River. He said that Goal 3, objective No. 5 seems to challenge that. It seems to Mr. Caulfield that it is going to be very difficult to address all at once all the points that somebody might conceive of. Mr. Wilkinson believes that prioritization is the key. What they are trying to do is allow the community "to get out what's bugging them," essentially through the issues, and "that's not just through the environmental community," he stressed. The Chamber of Commerce, for example, may have some different perspectives as well as the ditch companies themselves, and even the developers. The Water Board may also have different perspectives. "We want to get all of those on the table and see how they relate to one another," he said. Tim Dow suggested that encouraging the use of raw water in irrigating green spaces could be added on p. 4 under conservation practices. MaryLou Smith remarked that the Natural Resources staff has a big job ahead of it. Mr. Wilkinson indicated that they have limited staff so primarily they will be facilitators. Mr. Caulfield commented: "You might defeat yourselves if you try to do too much at once in terms of water issues." Mr. Wilkinson thanked the Board for their input and said he would keep them informed during the process. Proposed Surplus Water Rental Rates Andy Pineda directed the Board's attention to Agenda Summary Item No. 5 in their packets on the proposed surplus water rental rates. He explained that each year after the irrigation companies have established the annual assessment rates for their water, the Water Board recommends to the City Council, the rental rates for the City's surplus water. The agenda summary included a table with the assessment rates and the proposed rental rates for 1990. The second page listed the rates for 1988 and 1989 as well. The proposed rates are based on several factors, including past rental rates in the area, current assessments and anticipated supply and demand conditions. Tom Brown asked why North Poudre and Water Supply and Storage rent considerably higher than CBT water. Mr. Pineda explained that WSSC water is very marketable. "It's usually one of our easiest ones to rent in terms of supply," he said. Right now the City is not using those shares but renting them instead. According to the market, Mr. Pineda believes that the price put on those shares is probably on the low side. Water Board Minutes ' February 16, 1990 Page 4 "On that acre foot basis," Mr. Brown continued, "WSSC comes out about $19 versus $12 for CBT. That's considerably higher per acre foot; why the difference?" Tom Moore explained that actually it is about $15 for WSSC water. The 84 is the yield to the City. "That's what the City will give you if you turn it in. It actually yields about 106." Mr. Pineda added that with CBT water, particularly in some systems, if they rent the water from the City, the ditch company itself will issue another carrying charge, and sometimes even a shrink on that water, which tends to raise that price after they get it from the City. "Relatively speaking, we try to keep it on a cost per acre foot basis; at least on the ones we can easily rent out at this time." Neil Grigg moved that the Water Board approve the proposed rental rates. After a second from Ray Herrmann, the motion passed unanimously. The recommended rental rates are: Irrigation Company Pr000sed_1990 Rental Charoe* NCWCD Water (CBT) $ 12.00/ac-ft North Poudre Irrigation Co. $ 80.00/share Water Supply and Storage Co. $ 1,600.00/share Pleasant Valley & Lake Canal Co. $ 90.00/share New Mercer Ditch Co. $ 275.00/share Larimer County Canal NO. 2 $ 150.00/share Arthur Irrigation Co. $ 8.00/share Warren Lake Reservoir Co. $ 120.00/share * For late season rentals, rates may be adjusted to reflect the remaining yield or the prevalent market price of the water stock being rented. Cash In -Lieu -of Rights Dennis Bode pointed out the summary on Item 6 included in the packets. He explained that the City tries to keep the cash in -lieu -of rights price in line with the market value in the area, primarily of CBT water. "We try to lag that a bit, so we are not affecting the market," he added. Staff has tracked the price of both CBT water and North Poudre shares over the years. In recent months, particularly, staff has seen a significant increase in the price of CBT water. Therefore, staff recommends that the Water Board recommend to City Council, a change in the cash in -lieu -of water rights from $900 to $1100 per acre foot. The last adjustment in the City's in -lieu -of rate was in June of 1989 when it was adjusted from $800 to $900 per acre foot. Tim Dow asked why not $1200? Mr. Bode replied that although some people will say the price is $1200, from information he has received, it is in the range of $1000 to $1200. "I think going to $1200 is a little on the high side," he said, "and in my opinion we would be starting to lead the market somewhat." Water Board Minute* • February 16, 1990 Page 5 Henry Caulfield explained that for many years the Water Board has generally believed that leading the market was not a wise action. "As a public body, we should not be out there trying to push the market up or down," he said. "To what do you attribute the recent upswing in price?" Paul Clopper asked. "I think it's just the point where we are in the market," Mr. Bode replied. There have been a number of transactions. For awhile there was quite a lot of CBT water on the market. It is at the point now where there are not as many people with economic problems who are tying to sell their CBT water. It' simply a matter of supply and demand, he concluded. Larry Simpson concurred that the word he is getting is if you wanted to buy 100 units of CBT water at $1150, you probably wouldn't find anyone to sell it to you. "Farmers have become well again in the last couple of years," he stated. Basically, the supply is gone and the demand is up. He advised the Board to stay on top of it and change it as frequently as they need to. He explained that there are two theories on whether you lead the market or not. "If you put your cash in -lieu -of higher than the market, the developers will tend to buy the water and turn it over to you, and you probably get more water than you do if you go the other direction." "It's been argued on the Board in the past that we prefer the cash," Mr. Caulfield stated. Mr. Bode said that the City still gets more water than cash, although this past year that has changed somewhat. Webb Jones confirmed that there appears to be more of a tendency to pay cash than to acquire water. Tom Brown agrees that we shouldn't appear to be leading the market but he would like to suggest that when the price seems to have jumped at least $100 that we should consider adjusting our price rather than letting it go a full $200 as we have been doing. Mr. Caulfield said that the Board had agreed in the past to try to adjust it quarterly, but we haven't followed through on that. Mark Casey asked if we are considering a unit of CBT equal to an acre foot? Mr. Bode replied, "yes, we are, the way it shows here." That's just how the City accepts the raw water; 1 unit equals an acre foot according to the raw water requirements. "Does the market treat it that way, or does the market discount it and say it's equal to 7/10?" Mr. Casey continued. It's sold on a per unit basis, so it is a little hard to tell that, Mr. Bode responded. "Is there any data that is published or kept up on a regular basis that we can refer to if we wanted to peg ourselves, for example, to last week's going rate?" Mr. Casey wanted to know. Larry Simpson said that the NCWCD keeps an informal record of what is going on, both in the rental and purchase market. However, it's dependent upon what brokers and cities and others tell them, so "we often take the numbers with a grain of salt," he added. Once the quota is declared, the water is generally rented on a per acre foot basis, with no relationship to the units. Water Board Minutes February 16, 1990 Page 6 "We watch it on that basis and use that as one more factor determining whether we release more water into the system," he concluded. Tom Moore moved that the Water Board accept the staff recommendation to raise the in -lieu -of rate from $900 to $1100 per acre foot. MaryLou Smith seconded the motion. The vote in favor of the motion was unanimous. Mike Smith told the Board that if the price begins to go significantly over $1200, that would mean we might want to raise the rate to $1200. "We try to have that $75 to $100 leeway before we try to change it ourselves," he added. Tom Brown suggested that perhaps it should be raised or lowered in $100 increments. There was agreement that more attention should be paid to the fluctuations in price, particularly now that it is moving. Report on Water Bank Proposal Larry Simpson, General Manager of the Northern Colorado Water Conservancy District, was present to bring the Board up to date on the boundary issue and answer questions on other District issues. The Northern District is also involved in the discussions of the Water Bank proposal. Henry Caulfield informed the Board that he, Neil Grigg and Mike Smith recently attended a meeting sponsored by the Fort Collins Chamber of Commerce to discuss the proposed Water Bank concept. Utility directors and Water Board presidents from Loveland, Greeley, Longmont and Fort Collins were invited to attend. A representative from the Northern District was also there. Mr. Simpson said there is a need for a water bank or some mechanism in which the development of first right of refusal types of contracts could help to retain the water in the northern Colorado area. Of course the big problem is financing. There are a number of ways to do financing but all of them carry with them the stigma of more taxes or further infringement on the citizens. "There is apparently a strong feeling that many people don't want to pay today to help future generations," he said. Mr. Caulfield suggested that one option may be a taxing entity that could be formed, or using one of the existing taxing entities, to establish a resource bank, and use the money to buy water as it becomes available; then make it available to the municipalities as they need it. The District's biggest concern is if the water used by municipalities leaves this area. In that event it would become very difficult for the District to manage the reuse plan of water, to continue to allow that first use within the front range area, to manage ground water recharge, to maintain the agricultural economy, and at the same time provide for growth. "If that water goes south into the Denver area, many of our options for reuse are dissipated," he stressed. "Many of us are looking for a mechanism to retain the water in our area," he said. "Philosophically the District favors the water bank concept," he concluded. Water Board Minute • February 16, 1990 Page 7 One possible answer for financing would be to use something like the municipal sub -district, which has never used its 1 mill ad valorem assessment power, and use that 1 mill strictly for purchasing water. That falls heavily on the cities, "which places the burden on the right place," he contends. However, there may be a large contributor like Boulder who believes that it doesn't need any more water, and would not want to participate. Equities would need to be established. "It's hard to create a situation in which everyone would be happy," Mr. Simpson concluded. Henry Caulfield said that Ward Fischer's original proposal was for the cities to contribute a few million dollars immediately to be placed somehow in a reserve. That reserve would be available for what he called a crisis situation. The crisis situation would be when, for example, Two Forks would no longer be available and someone in the Denver area "would get the same itch as Thornton did," and begin bargaining for Northern Colorado water. The idea was that the cities who placed the money in reserves would bargain against those trying to get that water. In Mr. Caulfield's opinion, that's a very unrealistic proposal, in that he can't imagine Greeley, Loveland, Fort Collins and Longmont wanting to do that. From another point of view, it would be a very costly way of going about the matter of getting more water available. One of the points brought up at the meeting was that all of the cities mentioned have requirements that the developers supply the water. The water bank idea would violate the policy that the developers supply water at their cost. Mr. Caulfield pointed out that the full district and the sub -district both have the power to assess a mill levy tax, but the parent District exercises that power at the present time. The full district, however, taxes all of the rural areas, not just the urban areas. If it were done this way, equity would be provided and there would be a guaranteed income that could provide loans to the water bank in order to carry out the plan. Mr. Caulfield related that another idea that was pervasive at the meeting was to go out and buy as much water as possible. "If we went about this, as cities, in the way Fort Collins has pursued the purchase of water; namely making some estimates about what the developers were going to need to supply us by the year 2050, then the water bank could apply itself to talking to various farmers and ranchers about options to sell the water to us up to some estimated limit according to what the developers may want to supply," Mr. Caulfield suggested. Neil Grigg, a member of the Chamber of Commerce Water Committee, went further into the reason for the meeting. He explained that a little over a year ago the Chamber president thought there was so much occurring with water that they ought to create a water committee. Dave Stewart, a Water Board member, was the original chairman; now Dr. Grigg is the chair. Water Board Minutes February 16, 1990 Page 8 Since the Chamber is primarily interested in economic development, the question came up: What should we be doing in order to provide for the future economic development of the region as it relates to water? "As you can imagine, there was a lot of diversity of opinion," Dr. Grigg explained. For example, one person may want water so we can build more breweries; another may not want to build dams so the area can be kept pristine. The Chamber concluded that the committee would look at 3 areas: 1) The Water Bank concept; 2) Ways to cooperate regionally on infra -structure and water in general; and 3) A means of tracking legislation similar to the basin of origin bill. Ward Fischer was appointed chairman of the sub- committee on water banking. Two ideas emerged: one was the concept that Henry Caulfield described. It doesn't appear to be practical because of the financing problems. The other idea, that Dr. Grigg came up with, was called the management concept which means we could manage what we have better regionally. Perhaps there might even be an opportunity to provide some water to part of the Denver area through some kind of a management entity. Dr. Grigg suggested to the Chamber that "whatever ideas emerge, we ought to be talking to Greeley, Loveland and Longmont, so the meeting of water board presidents and utility directors was called to get their input on various ideas." All the cities were represented except Longmont. A variety of ideas and viewpoints were discussed at length at the meeting, but Dr. Grigg emphasized that the group didn't arrive at any conclusions. Larry Simpson believes that if a program like this were to be initiated, it would have to be more than crisis oriented; it must be a pro -active, methodical process. The entities chosen to do this would negotiate first right of refusal contracts, option contracts, etc. with the ditch companies in order to build up a relationship. As far as the Northern District getting involved with regard to the use of their assessment power, the Board of the parent District has never used it without a vote of the people, Mr. Simpson related. They currently have an agreement with the municipal members of the sub -district that they will not use that power except in the event of a financial default of one of the members. In other words, the Board will not use that assessment unless the cities themselves request it. The parent district can't get involved because the 1 mill was set by a vote of the people in 1937 and that tax, by contract with the United States government is to be utilized strictly for operation, maintenance and repayment of the Big Thompson project until the year 2002. After that, it is discretionary with the Board. Mr. Caulfield reported the conclusions at the meeting. It became clear towards the end of the meeting, he said, that two very different views were being expressed. One view was that there is enough water in Northern Colorado, including the ground water, in the South Platte basin, as revealed by the Samson model, that this area could be very generous with the Denver area. The proponent of this idea would like all of the entities to wait until the regional study, being performed for the District now, and the South Platte study are completed to determine what those studies reveal in Water Board Minute • February 16, 1990 Page 9 terms of water supply for the long run. Perhaps this will provide the answer of how protective Northern Colorado should be. Furthermore, the same person said that water could be sent to the Denver area in a pipeline, used there, treated and sent back up here somehow for cash crops. It was also pointed out that it should be a very well managed process. Mr. Caulfield concluded that there were real philosophical and analytical differences at the meeting. One view portrayed a far reaching kind of vision for Northern Colorado water, while the other side depicted a very protective vision. It was decided that the basic questions should be held in abeyance until the regional study is completed and the South Platte Samson Model study is completed. It seemed to Mr. Caulfield that the Water Board could take a similar position. There was no opposition to that from the Board. Larry Simpson began by saying that it would be nice to start form scratch and redesign the system and manage it exactly the way the model says you should. "I don't think that's reality," he said. "I think it's going to be more evolutionary," he added. To the degree a water bank could be established, it would help preserve options for some of that management in the future, and would give more control to this region, not by just any one entity. With regard to the boundary question, that is an issue the District Board has debated many times, and they continue "to wrestle with it," he said. There is an urgent need to deal with an area that lies to the north of the Boulder/Weld County line, and provide adequate water service there. The border is almost there anyway. "It's a jagged area that leaves small communities such as Erie, Fort Lupton and others, who really belong to the Northern Colorado community, without an adequate water supply." Eventually, adjustments are going to have to be made to move that boundary to the Boulder/Weld County line with the consent of the District and the Sub -district. There is currently an urgent problem with Erie. Their reservoir is dropping. They may not make it through the winter, so the District has made accommodation arrangements to get water for them this year. Fort Lupton has a major problem, Mr. Simpson continued. The quality of their water is under restrictions from the Health Department. The water quality is deteriorating rapidly and their wells are not functioning properly. The town of Nunn is also having difficulties. Mr. Simpson hopes that the District can deal with these towns' problems without setting a precedent with regard to the overall boundary question. Mr. Simpson said he doesn't think the Board would ever move the District boundary below the border of the Boulder/Weld County line. The area that is going to be a real question, however, is the Sub -district. If Boulder, Greeley and Longmont decide that they must sell their Windy Gap water, the Board will face a dilemma. Water Board Minutes February 16, 1990 Page 10 He stressed that the District has discouraged those cites from selling their water outside of the area, but they have the right to do what they want with it. The Board has the authority to deny the request. However, if Boulder comes to the Board with a request: 1) The Board has implicitly indicated they would honor each participant's right to do what they will with their water; and 2) Boulder has some legitimate reasons to enter into a court situation even though the Board has the right to set a contract and to control the transfer of that contract. Boulder has about 6,000 AF; Longmont has talked about 4,000 AF they might want to sell; and Greeley still has 2700 AF. That's about 12,000 AF that could be sold from the Windy Gap project, so the Board must address that. He suggested that a water bank might conceivably lock up that water and keep it in this area. Mr. Caulfield pointed out that the price of that water is much higher than our going price here in Fort Collins. Mr. Simpson agreed. "The water that was sold to Broomfield totaled about $6,000/AF," he said. He said that if some of the cities can sell the more expensive water to the Denver -metro area, it could help to preserve the water in areas of Northern Colorado. Mr. Caulfield mentioned the recent Greeley water transaction which, he said reflected quite a different perspective from what Fort Collins tends to have. Mr. Simpson explained that Greeley, for many years, has had a first right of refusal contract with the Greeley -Loveland Irrigation System. Their entire future water supply is tied to Boyd Lake. What happened recently is that entities have purchased the Greeley -Loveland stock. They came to Greeley and gave them the choice of either exercising their first right of refusal, which at that time was for several million dollars, or the water would be sold south. Therefore, instead of paying for the water, they exchanged it for Windy Gap water and that was sold to the south. If Greeley hadn't gone along with the transaction, they stood the chance of seeing their prime water supply sold out from under them. Marylou Smith asked how water could be sold to Broomfield. "Isn't it beyond the southern border?" Mr. Simpson explained that Broomfield has an assessed evaluation of about $180 million; $140 million of that is in Boulder County. Furthermore, their growth pattern will be into Boulder County. Mr. Caulfield pointed out that there were restrictions in the document. Mr. Simpson said that one of the concerns the Board had was that Broomfield wouldn't be using that water for several years. At this time, the CBT project is going through a major rehabilitation which is being paid for by everybody that is contributing the 1 mill levy. Broomfield, not being in the parent district, was exempted from that. As a result, the Board exacted a surcharge on Broomfield on a take or pay basis. They pay the carriage charge whether or not they use the water, which includes them in helping to pay for the rehabilitation. "Naturally, they are quite upset about that arrangement," Mr. Simpson concluded. Water Board Minute• • February 16, 1990 Page 11 Mr. Simpson assured the Board that water purchases will not happen under the same pressure situation that occurred with Broomfield. "The Board is not going to work under those schedules again," he warned. Hereafter, the City of Fort Collins and others will have ample opportunity to make comments. chairman Caulfield received a request from the City Clerk's office to send a Water Board representative to the Governance Committee meeting on March 5 from 7-9 p.m. The Committee will explore council leadership, forms of government, Council communications with the community, District representation, the selection process for mayor, etc. The representative from the Board must be a resident of the City. The Board selected Tom Sanders to be their representative. Staff Reports Treated Water Production Summary The Board received a water summary for 1989 in their packets. Mr. Bode asked if there were questions. "What's the snow pack?" Dave Stewart asked. "It's still on the low side," Mr. Bode replied. At Joe Wright it is about 90% of average, following the recent snow." Mike Smith called the Board's attention to a memo that was distributed at the beginning of the meeting. The memo went to the City Council and the subject was water demand management. Mr. Smith explained that near the end of the last Council meeting, Ann Azari suggested that the Council may want to revisit the issue of demand management. Following a short discussion, the Council directed the staff to prepare a resolution for the next Council session which would create a Water Board/City Council Committee to explore the issue of demand management. The memo contained background information for the Council. Mr. Smith believes the Council will pass a resolution creating a committee of 3 Council members and 3 Water Board members at their next meeting. Mr. Smith pointed out that HB 1106, a bill to require metering state-wide, seems to be progressing in the legislature at this time; that may impact the City's decision. Mr. Caulfield will appoint three Water Board members to the combined committee pending the outcome of the resolution at the next Council meeting. Mr. Smith also reported that staff just completed an agreement with the Fort Collins -Loveland Water District to sell them treated water on an interim basis. Copies of the agreement were distributed to the Board which gives them an opportunity to review it before the item appears for discussion on the March agenda. The Board will take action on it at that time. Mr. Smith announced that the Engineering Committee will be meeting next week to review the Wastewater Master Plan Report. Water Board Minutes February 16, 1990 Page 12 Committee Reports Legislative and Finance - Raw Water Irrigation Policy Webb Jones reported that staff met with the Legislative and Finance Committee on February 15 and discussed a few of the items that came up at the January Water Board meeting and tried to clarify what the policy should include. One item of discussion was that only customers who have treated water irrigation service would be eligible for the rebate. Another issue was when they would receive the rebate. An option that was proposed stipulated that they receive 50% of the amount of the rebate at the time they abandon the services, which would occur when the meters were removed, and the remaining 50% once their project was completed. Originally the policy said that the City would give them 100% when they abandoned the services. Another change requested was that the City rent the water out at the market rate rather than the assessment rate mentioned in the original policy. The Committee and staff wondered if there should be a requirement for someone installing a raw water irrigation system, to post signs indicating that they are using non potable water. The City attorney's office is somewhat reluctant for the City to require that because they thought it might obligate the City to make certain that the signs were posted. If for some reason they were not posted and something happened, the City could be included in the liability question. Dave Stewart asked if we should require them to meet all state and federal requirements. If you use non potable water for irrigation, the state requires you to post it, he said. Mr. Jones recently asked the Larimer County Health Dept. if they have a requirement and they weren't aware of any. "It could be that the state does," he added. Mr. Stewart believes that if we require them to meet all state and federal regulations, "we would cover ourselves." Marylou Smith asked for a clarification on renting the raw water to them. Mr. Jones explained that it was stated that those who need raw water "can lease it at the same rate paid by anyone else who rents our water." Tom Moore clarified that they wouldn't necessarily be given priority; they would get on the list like everyone else. Marylou Smith asked: "Don't we have more water available than we can rent right now?" Dennis Bode explained that the sources from which they would be renting are Arthur, New Mercer and Larimer No. 2. "We really don't have much demand for that water," he said, "so those sources should have water available." Mr. Bode said another important element is that these customers have already turned in raw water, so the City might have an obligation to rent it to them. Mr. Caulfield pointed out that there is no mention of renting water in the proposed ordinance. Ordinarily every detail is not mentioned in an ordinance, Mr. Jones explained. Paul Eckman wrote the draft, "so that we would be able to come up with a number to base the rebate on," he continued. "The rental rate isn't that unusual because it is pretty much what we do now." Water Board Minute • February 16, 1990 Page 13 Mr. Jones went on to say that one other item that needs to be pursued is working something into the planning process, so that new developments know that raw water irrigation is something we would like them to consider. With the proposed environmental plan that was discussed earlier, the opportunity is there to let those who would be affected know that it is something they should consider. "How do we make sure that the plumbers don't give us a cross connection?" Dave Stewart asked. Mr. Jones replied that by removing the meters there would be an air gap that would provide some protection and the water services would also be turned off. Requiring an inspection could be something we write in the policy, Mr. Jones suggested. Mr. Caulfield asked if the posted notice about untreated water would be included in the ordinance. "I don't think that requires a revision of the proposed ordinance," Mr. Jones replied; "that's more a policy issue." Committee Chairman Tim Dow stated that the Committee's position is that they support the current draft as revised. The only thing we need some guidance on, Mr. Jones said, is when the customers get their rebates. The way the ordinance is written, they get it after the project is completed. He explained that in talking with the homeowners, they would like some help up front; that's why 50% when they disconnect and 50% when the project is complete, was proposed. Mr. Stewart asked about the time difference between disconnection and completion. "However long it takes them to complete the project," Mr. Jones replied. The 50% arrangement is an attempt to compromise, he added. Tom Moore asked Dave Stewart if the water quality issue here bothers him. Mr. Stewart thinks there are enough controls at the state and county levels that water quality problems would be avoided. Mr. Jones related that he learned when discussing this with the County Health Dept., that Skyview Subdivision has a raw water irrigation system. They have been using it for a number of years, and it appears to be working well. Skyview is served by the Fort Collins -Loveland Water District. Mark Casey commented that what we are doing is basically rebating the average cost of the capacity, "but what we are getting back is a marginal savings from the capacity that isn't used. Over the short term, this will be a money loser for the City, but over the long term it ought to even out," he said. Mr. Jones responded that "we get our money back when we do our next plant expansion." He added that the rebates would be based on investment costs, not incremental costs. Mr. Caulfield pointed out that they are also losing their water rights. Dave Stewart also pointed out that by delaying the expansion, the City actually gets more money out of it because we build it with cheaper dollars. Tim Dow moved that the Water Board approve the draft with the additional proviso for the 50% split of payment at the time of disconnection and completion. Paul Clopper seconded the motion. Water Board Minutes February 16, 1990 Page 14 Paul Clopper commented that when this proposal was introduced to the Board, at that time he asked attorney Paul Eckman about the water quality issue and how they were going to handle it. "I was under the impression that we were going to incorporate some kind of hold harmless clause or something along those lines in the ordinance." Is that prudent? Dave Stewart responded that in the policy there should be a hold harmless clause when they disconnect. Mr. Jones said he believes the attorneys thought there would be an agreement executed that would incorporate the contents of the policy and that would be one of the things it would include. The question was called. The motion passed with 9 yes votes. Marylou Smith abstained due to a conflict stated earlier. Legislative Summary For the next item on the Legislative and Finance Committee agenda, Chairman Tim Dow directed the Board's attention to the Legislative summary that Wendy Williams had prepared. The only item he wanted to bring up was HB 1106, a bill that was suggested by the Northern District and sponsored by Rep. Irwin. It has already passed the house and now it's in the senate, and it's going to require meters, he said. "It looks like the state may be forcing the issue of meters on the City of Fort Collins," he warned. Henry Caulfield asked a question about the Greenway Bill and was told that it is still alive for a possible trail between here and Greeley. Distribution and Collection System Committee Paul Clopper reported that he and Neil Grigg are very well satisfied with the infra -structure and the maintenance tracking that is going on currently, and that they are comfortable with the level of service we are getting. However, there were a couple of recommendations that the committee put together. Mr. Clopper is prepared to follow through on them with either suggestions from the Board or help from the staff to do so. He believes that the committee structure is not necessary to do that and recommends that it be dissolved. MaryLou Smith said that the discussion from the last meeting satisfies her that the Distribution and Collection system is being taken care of very well. Mr. Clopper said there are things that could be pursued if the perceived need is there. Neil Grigg explained that there were two areas that he is aware of where the committee thought that it might be fruitful to revise procedures or work a little more in depth. This is going beyond the fact that they think the management is really good and that the system is in good shape compared to other systems, all of which have periodic breaks. Water Board Minute• • February 16, 1990 Page 15 One area was in the keeping of statistics and the reporting on the statistics on the system which would give the Board, as well as the Utility, a way to keep up with conditions of the infrastructure even better than now. The other area was to see how the data base that's in place might be used to do some economic analysis, and perhaps even more sophisticated programing on where the Division would do replacement and maintenance and coordinate better with the street program which is performing more aggressively now. Paul Clopper added that it was even mentioned that there is a possibility of getting a master's degree candidate involved with a project like that. Henry Caulfield also brought up the point that the next time staff meets with the Fort Collins -Loveland Water District, that staff try to straighten out the isolated customer situation. Paul Clopper reiterated that if the D&C Division decides to pursue any of the areas mentioned, he would be happy to work with them to see exactly what could be done, recommend some form of action and define the level of effort required. It was decided that the committee would be dissolved since there was no further need for it. Other Business Mr. Caulfield reported that with respect to the Wilderness issue, we have no word back from Senator Wirth of any changes that they propose. Mike Smith said Sen. Wirth's staff was thinking about responding somewhat favorably towards the City, but there is nothing definitive yet. "They seem fairly enthusiastic about trying to please the City of Fort Collins," he added. Also Sen. Armstrong's bill is now available and staff will provide a copy to any Board member who requests one. It is drafted so it is weighted towards water development, he said. It is Mr. Smith's opinion, at this point, that Sen. Wirth's bill has a better chance than Sen. Armstrong's, and Wirth's doesn't have much of a chance. Rep. Campbell has introduced a bill, but staff hasn't seen it. It is supposed to be a compromise. Mr. Caulfield brought the Board up to date on the National Recreation Area task force deliberations and possible recommendations. He said that the task force will probably recommend that this be a complete City enterprise at the beginning. There will be no federal involvement at all in terms of authority. It will be suggested that the City look favorably on the idea of a museum and educational enterprise using the Power Plant site. It would be up to the City to seek out someone who would take the lead in developing a museum and educational resource and that a committee be appointed of water experts in this area to advise about what is worth pursuing. This will be the first stage. Mr. Caulfield pointed out that the task force has discovered that both the Park Service and the Forest Service have existing authority and theoretically money, to provide technical assistance to the City in the development of a museum and an educational program. Water Board Minutes February 16, 1990 Page 16 Perhaps a second phase may involve Greeley. Mr. Caulfield related that there is a precedence for what is called a National Heritage Corridor, where all "the teeth, as far as federal control, have been removed." This will be looked at sometime down the road to make certain whatever legislation is proposed would be okay. MaryLou Smith remarked that, while the concept is worthwhile, in terms of other priorities of things that we need in this community, she wouldn't vote for this as a priority. She would prefer to incorporate a water exhibit in our current museum. Since there was no further business, the meeting was adjourned at 5:05 p.m.