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HomeMy WebLinkAboutWater Board - Minutes - 03/22/1996WATER BOARD MEETING March 22, 1996 3:00 - 4:33 P.M. Water and Wastewater Utility Conference Room 700 Wood Street COUNCIL/WATER BOARD LIAISON Chuck Wanner WATER BOARD PRESIDENT Paul Clopper - 223-5556 STAFF CONTACT Molly Nortier - 221-6681 MEMBERS PRESENT Paul Clopper, President, John Bartholow, Vice President, Howard Goldman, Alison Adams, Robert Ward, Ray Herrmann, Terry Podmore, Tom Sanders, Dave Frick, Tom Brown, David Lauer STAFF Mike Smith, Wendy Williams, Gale McGaha Miller, Dennis Bode, Curt Miller, Molly Nortier GUESTS John Bigham, Northern Colorado Water Conservancy District George Reed, Citizen Observer Sue Ellen Charlton, League of Women Voters Observer President Paul Clopper opened the meeting. The following items were discussed: MINUTES Ray Herrmann moved that the minutes of February 16, 1996 be approved. John Bartholow pointed out on Page 3, first paragraph, second sentence that South Platte River should be changed to the Upper Colorado River Recovery Program. After a second from Alison Adams, the Board unanimously accepted the minutes as corrected. UPDATE: NORTHERN COLORADO WATER CONSERVANCY DISTRICT John Bigham brought four items for distribution: the executive summary of a publication called Going Broke? Costs of the Endangered Species Act as revealed in Endangered Species Recovery Plans; the snow/precipitation update as of March 22, 1996; the agenda for the Spring Water Users Meeting to be held in Fort Collins at the University Park Holiday Inn on April 1 Oth; and a summary of proposed legislation to adopt a Public Trust Doctrine to protect public ownership and the natural environment. Water Board Minutes March 22, 1996 Page 2 Mr. Bigham began by saying that the Northern District was pleased to receive a letter, prepared by Water Utility staff, with suggestions on the CBT cap. "The District is evaluating it," he said. "It's evident that your staff put a lot of thought and study into the letter." He went on to say that the snow pack continues to be substantial. The collection system on the west side is at 132%, while the South Platte Basin shows 161% of average. With those numbers it appears we are going to have a good spring runoff. The District met recently with the allottees, and those people using the water out of Carter Lake. They discussed the problems that resulted from the pump explosion accident. "Everybody was willing to work with us," he said. Mr. Bigham anticipates that the District Board will set a 50% quota for the north end, and allow all the carryover that is up there to be used. In the event that additional water is needed, he thinks there may be some non -charge water that could be issued for this side "because we could spill upwards of 75,000 acre feet of water out of Granby this year because there isn't enough space to store it. The snow pack is high, Granby is full, and, if we could put it in there, we would have a 3040,000 ac-ft hole in Carter. But because of the explosion we can't, so that water will go down the Colorado River, he concluded. As far as the Flatiron pump is concerned, the Bureau is moving along on the rewinding, working on the core. The District is continuing the study and design of the bypass to go around the pumping system so "we could run water into Carter when the pumps are down." There has also been interest by PRPA and Tri-state to participate in part of the project by installing two 6 megawatt generators in the two bypass lines to generate 12 megawatts of power. They are evaluating the potential for their participation but haven't yet arrived at any conclusions. The District anticipates that the pump will be back in service sometime in September; the bypass may also be in service by then. At this point financing of the estimated $1.2-1.4 million bypass project is the largest hurdle. Under Amendment 1 and other restraints, there are some tough issues that must be addressed. He next referred to the agenda for the NCWCD Spring Water Users meeting on April 10 in Fort Collins at the University Park Holiday Inn. He encouraged Board members and staff to attend. This is an opportunity to learn about the District and some of the problems it will be facing, he said. He brought copies of a proposed initiative, 111996-6", which would be an amendment to the Colorado constitution. It concerns "the public's interests in state waters, and adopting a Public Trust Doctrine to protect such public ownership and the natural environment; providing that water use rights may be granted or assigned to the public and to any watercourse without hindrance from a governmental or quasi -governmental entity; and requiring the State of Colorado to defend such public ownerships of water from transfer from the public ownership and from transfer from the watercourse to which the water right was pledged." The District Board prepared a summary which Mr. Bigham highlighted as follows: Water Board Minutes March 22, 1996 Page 3 "This measure requires the State of Colorado to adopt and defend a Public Trust Doctrine for the stated purpose of protecting the natural environment and the public's right and ownership in State waters." "The Office of the State Engineer in the Division of Water Resources estimates that it will need 49 additional full-time employees and $2.6 million annually to implement the measure." "The Colorado Water Conservation Board estimates that it will need an additional 11 full- time employees and $8.7 million annually to implement the measure, including litigation and additional stream gauges for monitoring." "The Department of Local Affairs estimates that the amendment will have a net fiscal impact of between $2.28 billion and $3.26 billion, assuming the Public Trust Doctrine is applied only on a (future) prospective basis ... If the doctrine is retroactively applied to (previously) existing water rights, there will be a similar fiscal impact to replace existing water supplies." Mr. Bigham said the District has some problems with this proposed legislation that need to be considered. "The most alarming part of this is the fiscal impact," he stressed. If this initiative gets on the ballot, considerable education of the public will be necessary. Mr. Bigham said the handout called "Going Broke?", is an executive summary of a rather large volume by that title, which lists the costs of the Endangered Species Act as revealed in ESA recovery plans. It was prepared by the National Wilderness Institute. In the middle of the second page there is a fist of the different plans: the highest plan cost, the medium plan cost, the average plan cost, and the total cost, $884,164,000, of just the species that are in this one report. This doesn't include other related costs which are listed below that. Most of the pages in this summary relate to species that may affect us in the South Platte Basin. On the back page a newspaper article relates that the Interior Department is removing 3,600 "candidate" species from its books and concentrating instead on 182 plants and animals of immediate concern. John Bartholow acknowledges that the cost numbers on the sheet about the proposed Public Trust Doctrine legislation are high. "How much money do you think we should spend to support the Public Trust Doctrine in Colorado?" he asked philosophically. "That's a tough question to answer," Mr. Bigham replied. "Obviously there is a value to the Public Trust Doctrine, and we realize that." Looking at some of the numbers and knowing some of the sponsors of this, and the way part of this was put together, the District thinks there are some real concerns about what it will do to the economy of some of the communities that will be impacted. What they found was that some of the proponents, at least in their testimony, said they don't care what it costs, and the testimony was just as emphatic on the other side; "I guess I would say that I am somewhere in between those two extremes," he said. He added that Mr. Bartholow's question is especially hard to answer if there is a possibility of "substantially reducing our budgets, and actually wiping some out." Water Board Minutes March 22, 1996 Page 4 Paul Clopper remarked that the snowpack numbers are quite impressive. He was curious about how this compares with last year when we had record late spring snow. "Do you recall where we peaked out in terms of snowpack last year?" "The day the District Board set the 80% quota was the second Friday of April. At that time we were running very low; about 75-80% of normal," Mr. Bigham replied. "The following Monday morning it began snowing, and we had heavy snow for several weeks. It turned out that the quota was set 30% too high; it should have been set at 50%, and there was still plenty of water." He reminded the Board that the District brought over almost 45,000 ac-ft of non -charge water to release to the rivers for beneficial use to anybody who could use it. He also pointed out that at this time last year, the temperatures were in the 70s. Mr. Clopper asked if anyone has put together any flood projections for this year. "It's a little early to project," Mr. Bigham replied. At this point the District doesn't see any flood potential because there isn't much snow in the lower elevations; most of it is in the 10,000 and up elevations. "We are already releasing water from Granby, cutting the ice out of the rivers, and we will continue to bring the flow up, trying to reduce that water. We have alerted everybody up and down the river that could be potentially damaged, to protect lives and property. We don't want to release on top of the hydrograph," he stressed. Mr. Bartholow wondered if the District could be liable. "If we are prudent in the way we release it, the law reads that if, in an act that you can't prepare for, something gets ready to overtop and you have to release, you can bypass the same amount as the inflow and outflow to equalize it and not be liable," he explained. STAFF REPORTS Treated Water Production Summary Dennis Bode reported that for the month of February the Utility produced 1243 ac-ft., which is 89% of what was projected for an average situation. It wasn't an unusual February, he said. He pointed out the graphs from Joe Wright Reservoir and Deadman Hill snotel. These are interesting in that they relate to Paul Clopper's question about snowpack at this time last year. If you look at either one of the graphs, the 1995 snowpack numbers were below average up until early April. "This year it is almost a mirror image of that so far. We're wondering if it may turn dry and end up below average," he remarked. If you look at the graph, you can see that the 1995 peak was about 40-50% above the average peak, and the runoff could have come out quicker because it was warmer that late in the year. "Last year was potentially quite dangerous for awhile," he said. Both Joe Wright and Deadman are up around 134% of average now; "we're actually lower than most of the South Platte Basin," he related. Overall the South Platte Basin is about 160% of average. "We're watching the snowpack with a great deal of interest," he concluded. "We could actually get higher than 134% for Joe Wright for the next month or so," Dave Lauer stated. "We could get up to 160%." "As it did last year, it can change rapidly," Mr. Bode responded. Mr. Bigham pointed out that late spring snow usually melts pretty fast, so it can be very dangerous. Water Board Minutes March 22, 1996 Page 5 Financial Status Report Wendy Williams said there was little to add to the information on the graphs that were included in Board packets. "You can see that the graphs track last year's revenues pattern probably a little higher." Water Conservation Annual Report Dennis Bode said that Jim Clark, former Water Conservation Specialist, completed the Water Conservation Annual Report just before he left to begin his new job. Mr. Clark summarized each of the demand management measures that were in the policy resolution adopted a few years ago. There was an update of some of the public education efforts he had undertaken this last year, and he also updated the water use numbers. Mr. Bode said that Terry Podmore, Chair of the Water Conservation and Public Education Committee, called to say he had reviewed the report and found it to be acceptable. He will be coming to the meeting a little late today. Mr. Clopper appreciated having the resolution attached to the report, because it helped him recall what the original resolution contained. John Bartholow had several questions: In item No. 1 the charge is to have an ongoing leak detection program, but at what level is ongoing? "If we have two employees devoted to that and they have found what is estimated to be $61,000 worth of water, is this a cost effective program to continue, or maintain at the same rate? Should it be done every other year or every third year?" Mr. Bode didn't have an immediate response except to mention that there probably are some other costs other than the direct costs that we see. "In terms of water rights, for example, to the extent that we reduce our system losses there, that means, at least for that increment, we don't have to have that additional supply on hand," he pointed out. "That's a benefit of having that program." He thinks there are some other benefits in terms of catching some of these leaks before they become a major problem. He added that he thinks it is a good idea to evaluate the cost effectiveness "as we go along." "If you lose 1900 ac-ft a year," Tom Sanders pointed out, "an acre-ft is worth $1000, that's $1,900,000 you're losing in water. Although a 6% loss from leaks in a distribution system is pretty low," he added. Mr. Bartholow continued by saying that it seems to him that item No. 2, the indoor audit, is in the category of "it's been done, the options have been evaluated, and basically nearly everything's been done that could or should be done." Mr. Bode said that staff concluded that the system is set up, in terms of the City facilities, where it's almost an ongoing audit. "Should this be something that is omitted from the annual list of things to do?" Mr. Bartholow, asked, "because you're doing it." "I think we see most of these measures as being implemented and on -going," Mr. Bode responded. "It seems that there are several in that category; Nos. 2, 5, 11, for example," Mr. Bartholow stated. Mr. Bartholow said the other item that was bothering him a little was No. 10: "Where determined to be financially justified for individual City departments, implement central irrigation control for irrigated City -owned landscaping." He said the Water Utility has been authorized to look at and monitor water conservation measures, but it's the Parks Department's responsibility to do it. He said Water Board Minutes March 22, 1996 Page 6 the mismatch between authority and responsibility is something that has always bothered him. "I wonder if that is proceeding okay, or should a different strategy or tactic be tried?" he asked. "The strategy so far has been to let them know that we encourage that kind of thing where it is financially or economically justified," Mr. Bode replied. "Other than that, we can't control their budget or put money into their budget to spend money in that area." "Do you find them receptive even though they want to postpone it?" Mr. Bartholow asked. "I think they are," Mr. Bode replied, "but I haven't had as much direct contact with them as Jim Clark had," he added. Mr. Bartholow s final question was related to water demand. He said there has been discussion as long as he's been on the Board about adjusting the data for the weather. It's been said each year that it will be done the following year. "Have you determined that it's really not worth it to do that?" "I think we need to track it," Mr. Bode acknowledged. He said staff has been doing some work on it recently. A water resources engineer that the Utility hired a few months ago, has been working on it. "Currently, we are about 40% metered and I think that probably has a big impact on water reduction. We believe there is now close to a 10% reduction in that original 235 gallons per capita per day that we started out with about 5 years ago." "Are you retroactively adjusting for weather in that whole period you are looking at?" Mr. Bartholow wondered. "What we have done is look at the base period prior to 1990; 5 years from 1986-1990. We have tried to establish a pretty good base there. We have used a model that includes weather factors and compared that to a longer period of weather, and looked at the -types of years we've had in the last 5 years and adjusted those according to the model. We have been able to detect, strictly for the outdoor use part of it, a decline over the last 5 years. "Are the figures on the graph in the back adjusted figures, or are they just total divided by total?" Ray Herrmann asked. "They are total divided by total," Mr. Bode answered. "That gives you a pretty clear picture," Mr. Herrmann observed. "We have been about 200 gpcpd, and we're staying pretty well in that range," he added. Mr. Bode said the numbers haven't jumped around much in the last few years, "and actually what you are seeing here is partly affected by weather. We've had cooler and wetter summers for the most part in the last five years." Mr. Bode said that next year in the conservation annual report, there will probably be a graph that will show the normalized results of the gpcpd. Tom Brown asked if the last graph on the back page is for both metered and non -metered customers. "Yes, that's right," Mr. Bode replied. "Would it be possible to see it broken down between metered and non -metered to see the effect that metering is having?" Mr. Brown wondered. "Sure," Mr. Bode said. "The metered customers are much lower. When you jump from un-metered to metered is when you see the big difference. I don't know that you will see much of a trend there," he added. "How much lower would the metered customers be?" Mr. Herrmann asked. "About 20% lower," Mr. Bode replied. "Is it an easy thing to do to separate them?" Mr. Brown asked. Mr. Bode explained that the numbers on the graph reflect a number of different factors. The total use includes businesses, City facilities, system losses, etc.; all kinds of things are thrown into this composite graph. "We have good break downs among all of those." Water Board Minutes March 22, 1996 Page 7 Mr. Sanders said he would like to see that data. He stated that he respectfully disagrees with staffs calculation of a 20% difference between metered and non -metered; "a 20% difference is something the politicians would want to hear," he argued. "I think you wouldn't find that much difference except if people went to xeriscape-type landscaping. Daily use wouldn't be that different," he insisted. "I think our data has shown that average use for metered single family residences is around 140,000 gallons a year," Mr. Bode pointed out. "When you factor out the flat rate user, it is considerably larger than that." "I would like to see the data," Mr. Sanders repeated. Mr. Bode acknowledged that the current volunteers for meters may tend to be ones who have a smaller number per household. Wendy Williams said that when the City changed over in 1989 to the current billing system, unfortunately "we lost the lot areas for many of the files. We have it for the accounts that were changed over since then, but anything before that is lost." "Do you have a 50-50 break down in terms of the number of commercial and residential total metered versus non -metered?" Dave Lauer asked. "There are many more residential accounts than commercial," Mr. Bode replied. He also pointed out that all commercial accounts are metered. "If you added the metered residential to that, what kind of balance would it be in terms of percentage?" Mr. Lauer continued. There are about 40% of the single family/duplex customers that are metered; and all the multi -family customers are metered," Mr. Bode explained. "How much of that 60% translates in terms of users?" Mr. Lauer asked. "I think we would probably want to look at just single family metered customers," Mr. Bode responded, "and compare them with flat rate single family customers." "I wouldn't worry about plotting the flat rate customers," Mr. Herrmann suggested. "Because of commercial use which varies considerably, it's hard, when you mix everything together, to see what's happening," Mr. Bode said. He concluded that there are ways that staff can display that to help everybody get a feel for the total picture. Mr. Ward thinks something like that would be useful if you can say, "preliminary results lead the staff to believe that per capita use has decreased 5-10% comparing 1995 to the base period." He asked if staff has a number quantifiable that they will be able to compute that percentage accurately. "We are just about to the point where we have developed the procedure. Our goal is to say 'this is where we think we are; we show 220 gpcpd on the annual use actually observed. After we adjust for the weather, it's 205 gpcpd, for example." "Without having designed a system from the beginning to actually track it properly, are you trying to take your existing data and work it around to show what happened?" Mr. Ward asked. "We have been working on the concept for several years," Mr. Bode replied. "I think we are at a point, within a range of accuracy, that we can fairly reliably track that number, recognizing that there are a lot of variables: changing patterns of use, or different mixes of multi-family/single family, for example. "The main thing we are tracking is how it compares to that base use that we had in the late 1980s, and maybe there will be some other impacts besides conservation. It will be difficult to determine what the cause of those changes are, whether it's conservation, public education programs, or just metering. Water Board Minutes March 22, 1996 Page 8 Mr. Ward said that other cities trying to do this are saying, if we really want to be accountable for water conservation, we need to think it through more carefully, and start collecting the necessary data now. "One of the major challenges is knowing whether your measurement data is accurate to begin with," Mr. Bode pointed out. "Just a few percentage points on something like this has a big effect. "Weather data is another challenge. We use official CSU weather numbers, but we have run across a few days where we know that there was 1/2 inch at the weather station, but other parts of town had 2 inches, for example." "Is there any thought to how you are going to deal with the commercial aspect of this?" Alison Adams asked. "What are you really trying to determine at the end, the City's use as a whole divided by the people who live here, or people's use of water in terms of conservation? How does commercial use fit into that? Is residential use of water subsidizing commercial use?" Mr. Bode answered that it goes back to the original resolution which is based on total use with the exception of Anheuser- Busch. "As we track the water, we will continue to track it for all classes and customers." The goal in the report is to reduce the gallons per capita usage, which is total use divided by total population. "Is that going to become difficult if your commercial use becomes quite large? It's going to be rather unfair in terms of a persons conservation efforts when they are subsidizing the commercial efforts," Ms. Adams pointed out. "I think if we had several big new users we might have to look at what that means, and evaluate how to calculate it," Mr. Bode responded. "You mentioned that the brewery was'a different color animal' so to speak," Dave Frick said. "We have lots of other small breweries developing in town; that's going to mean heavy water use, I assume." "I don't think their use is too large, but I haven't seen the data," Mr. Bode replied. Ms. Adams commented that, in some of the conservation information she has looked at, municipalities have presented it in terms of some kind of gross per capita number and then some sort of adjusted per capita number. That reflects the residential component of that per capita use. "That's a good idea. We can certainly look at our total residential use, and track that number; particularly when we are all metered that would be easy to do," Mr. Bode said. Mr. Clopper asked if Jim Clark's position will be filled by the new engineer that was hired recently. Mr. Bode explained that when Andy Pineda left last summer, Beth Voelkel moved to his old position and a new engineer was hired to take the position that she held. Wendy Williams said that staff is in the process of reworking Jim Clark's job description to broaden the duties to include some more public education. The new person, however, will be doing the same sorts of things with an emphasis on education. Partly because of the change in the job description, the new person will be working for Ms. Williams rather than Dennis Bode. Mr. Clopper also asked about item No. 12, the Zero Interest Loan Program. "Initially there was a fair number of people taking advantage of that, is that still the case?" The Zero Interest Loan Program is pretty much being used for people who call and want a meter installed and the Utility discovers that they have a problem with their lines, Ms. Williams related. They then have an opportunity to use the Water Board Minutes March 22, 1996 Page 9 Zero Interest Loan Program to cover the cost of replacing the service line so the Utility can install a water meter. "There have been several potential volunteers in the old part of town who have chosen not to go ahead at this time because it is still a voluntary program." The Zero Interest Loan Program is not one that the Utility has gone out and marketed, she added. Dave Lauer commented that commercial conservation efforts ought to be just as significant as residential; we shouldn't just dwell on residential. "That's certainly true, Mr. Bode agreed. "As we gather data it can help us to identify areas where we can work on conservation." "Regarding the graph that has a lot of things thrown in together, if you are going to the trouble of bringing out these various factors, you ought to try to control for all of the effects you are talking about, so that what we are looking at it as a little more real," Mr. Lauer suggested. Mr. Bode clarified that the main thing staff is talking about taking out is the weather -related information which causes the numbers to fluctuate. "Most of the other things are pretty gradual and smooth, so I think if you remove the weather you have a pretty good idea of the actual use," he said. Removing the weather influence will allow staff to calculate where they are in meeting the goals of the Water Demand Management Resolution. CBT Ownership Limitations Update Dennis Bode said he didn't have anything to add to what was included in a letter that was sent to NCWCD with suggestions for the District Board to consider as they finalize the CBT Ownership Limitations. Water Board members received copies of that letter. John Bigham, from the District, repeated that they appreciated receiving the letter and the Board and staff are considering the Utility's suggestions. Tom Sanders said he liked the letter and thinks a sliding scale is a valid approach. Others agreed. Dave Lauer asked what the District's response is to the suggestions. Mr. Bigham replied that the District is evaluating the numbers. They were pleased with the presentation and acknowledged the considerable work that went into it. Update on Meadow Springs Ranch Gale McGaha Miller related to the Board what has occurred regarding the proposed sale of property at the Meadow Springs Ranch after the last Water Board meeting. Mike Smith met with the city manager and deputy city manager to get some additional clarification of what was intended with the potential sale. In turn, the city manager met with the mayor and mayor pro tem, and the direction they received was that there is no urgent need to sell the ranch property. The only offer worth considering would be one at full appraisal with no development allowed anywhere on the ranch. "When I communicated that to our realtor, that was the last I heard from him," she said. Ms. McGaha Miller announced that April or May would be the best time to tour the ranch, and invited those interested in a tour to contact her. Water Board Minutes March 22, 1996 Page 10 Update on Current Proposed Legislation Ms. McGaha Miller said there wasn't much to report. She gave an update on a couple of bills that were discussed at last month's Legislative and Finance Committee meeting. One of them related to a bill to prohibit special districts from condemning municipal land for the purpose of water or wastewater projects. "That might have come in handy for us in the past," she said, "but it was killed." There was a second bill that would have changed the language in the statutes regarding the encouragement of consolidation of wastewater facilities when site applications come up for consideration; that bill was also killed. The Operator Certification program was due to sunset this July and needed legislation to keep the program running. Previously there were Continuing Education credit requirements (CEUs) for operators, and that turned out to be a big political hot potato this year. Legislators are removing CE requirements from every certification program. Quite a lot of lobbying occurred from operators and other groups to keep the CEUs in. In the end the bill that was passed by the House and Senate is just bare bones to continue the certification program with re -testing for operators once every five years, and no CEUs. A legislator has agreed to sponsor "fix it" legislation for next year with the intent to make that program more effective. Forest Service Land Trade Update Mike Smith reported that City Council decided at 2:30 A.M., after a long Council session, that they did not want to proceed with the legislative approach. They will instead go ahead with the administrative process. The Forest Service indicated that they probably won't be able to start that until October/November due to budget constraints. Mr. Clopper asked if staff has had any discussions with the other parties to the legislation since the Council decision. "Some may want to talk about dividing up the Rockwell land; Greeley would like to do that, and need to do it to make this work," Mr. Smith replied. "I understand they are planning to re -draft the legislation; in other words, they are going to proceed with their own legislation." "What was the percent of ownership of the Rockwell property?" Mr. Bartholow asked. "It was 50- 50," Mr. Smith replied, "so we'll try to decide how to divide it up." "This means the end of ever having a dam up there?" Mr. Sanders asked. "Not ever," Mr. Smith said. "Actually we didn't own the site of the dam anyway," he added. "The reservoir would have been inundated up further anyway," Mr. Clopper observed. "One could always file for a new decree," Mr. Smith remarked. Water Board Workshop Date Molly Nortier reported that she contacted AnneMarie Bleiker of "COSTAR" in California, and Friday, September 20, 1996 works fine for their calendar. We will convene about 1:00 p.m., break for dinner, and complete the program after dinner. Details will be arranged later. • Water Board Minutes March 22, 1996 Page I COMMITTEE REPORTS Water Supply No report Legislative and Finance Howard Goldman reported that the Committee met for about two hours prior to the Board meeting. Former Utility employee Scott Harder gave an excellent presentation on wastewater Plant Investment Fees (PIFs), he said. Essentially Mr. Harder discussed the philosophy which seems to indicate that we ought to require everyone to pay their fair share, which isn't what we are doing now. That would mean that some PIFs, particularly commercial PIFs, would increase. Other PIFs, duplexes and multi- family residences, would decrease. The water PIFs are still under consideration. They will be completed after the water master plan is in place, and that has been slow because of the situation with the consultants. The Committee hopes to have a presentation soon on the water PIFs. After that, they will bring both water and wastewater PIFs to the Board, perhaps at the beginning of summer. President Clopper asked if staff is looking to the Water Board to send a recommendation to the Council within the next few months. "Both the water and wastewater PIFs should go to the Council, hopefully before the end of the year; preferably in the summer or early fall," Mr. Smith replied. The major area of change that staff sees, as Mr. Goldman mentioned, is the philosophy of how to charge. Currently we use the incremental marginal cost method where you look to the future and determine how much it's going to cost. "As we look at that, there is probably only one case when that really is true: when all your capacity in your system is used up, and all the new projects are just for new customers, which in reality would never happen," he stated. "What actually happens is you never use all of your capacity, especially in the distribution lines, and very seldom do you have a time when you don't have capacity left in your treatment facility." There are two pieces to average cost methodology: existing facilities and new facilities. "It does have an impact on the fees, but it is probably a more accurate representation of what the true costs are, and as a result, we will see some increases, and in some areas some very significant increases, especially for commercial," he said. "When we look at the preliminary numbers, some commercial irrigation accounts could have some heavy increases. It's not unexpected because the major costs are where the high demands are, and that's mainly in outside irrigation." He added that a few people will be happy, but most people will not be happy with this change. "Duplexes and multi -family housing will go down, which is good because it will help some affordable housing type projects," he remarked. He concluded that it's time to update the PIFs. "Are we doing anything else for affordable housing other than the equity aspect on this one?" Mr. Sanders asked. "We really can't subsidize because utilities, by the Charter, are not allowed to subsidize," Mr. Smith responded. "The City can because they can use some of their general funds. Water Board Minutes March 22, 1996 Page 12 They are also doing things like giving priorities in processing development plans for affordable housing. He added that it is tough for the City because land costs are going up constantly. Dave Lauer pointed out that Land Consortia or trusts have been developed for this purpose. "Those work quite well," Mr. Smith agreed. "At least you hold the value of the land in perpetuity," Mr. Lauer added. Dave Frick asked if variation in PIFs for residential lot sizes is being looked at. "As I recall, residential lot size is being considered for the water side," Mr. Smith answered. Mr. Frick thinks it would be a little more equitable for the larger lot sizes to pay a higher PIF. "The square footage of the house should be a factor too," Mr. Lauer commented. "The size of the lot is a real demand factor from the peaking standpoint, more than inside the house," Mr. Frick added. "Was part of the discussion in the meeting around establishing a zoning appeals process when all of these things hit the fan?" Mr. Lauer asked. "Those kinds of things are real problems occasionally," Mr. Smith acknowledged. "Developers are trying to prepay permits before fees change, for example, and they are not allowed to do that." Mr. Smith pointed out that it's going to be difficult for the whole City because a number of areas are considering impact fees. Mr. Goldman wondered how the Water Board could somehow help the City Council and the community at large to see all of these various fees together without just taking them one at a time. It seems to Mr. Goldman that it's difficult to gage the overall impact without understanding the impact of all the other items the City is also considering. The question, Mr. Smith said, is "do you want to have cost of service," and if you want to be guided by that philosophy, "one must say, here is what it's going to cost." Conservation and Public Education The chair of the Committee, Terry Podmore, apologized for not being here for the discussion of the Water Conservation Annual Report. He had a conflict at work. Engineering No report REGIONAL WATER SUPPLY STRATEGY No Report . REGIONAL WASTEWATER SERVICE ISSUES No Report 0 Water Board Minutes March 22, 1996 Page 13 OTHER BUSINESS Regional 201 Study Mike Smith said this study is moving forward. Camp, Dresser & McKee was selected as the consultant. "We are working on the contract now," Ms. McGaha Miller related. Price of CBT Shares Tom Brown said he was looking at a Wall Street Journal article which showed the price of CBT shares at something like $1700 now. "Is that accurate? Apparently they don't publish the transactions in the Water Intelligence Monthly anymore," he said. Dennis Bode and John Bigham agreed that it is now $1600-1700. Mike Smith pointed out that we are still at $1500 for our cash in -lieu -of rate. Mr. Brown observed that he didn't think the price was going to go down in the near future. Robert Ward said he received a call from a reporter in California wanting to know about our "innovative" water trading system that we use in Northern Colorado. "I referred him to Brian Werner of the NCWCD. What he was talking about was the fact that we have water that "floats; it's supplemental." I tried to explain what supplemental water is and how the project was designed that way. I don't think he grasped the concept because it's so different." "Most federal projects are supplemental in someway," Mr. Bigham explained, "but most of them don't have the transfer rights that we have." Mr. Ward thinks they are trying to set up a market in California that mimics some of the advantages that we have. Mr. Brown asked how long CBT has been up around $1600. "Probably about the last 12-14 months it's been in the $1500-1700 range," Mr. Bigham replied. "It seems to me we ought to be re -thinking our $1500 price," Mr. Brown proposed. "I think we are getting to the point where we will want to look at that," Mr. Bode agreed. "We don't try to push the market," Mr. Brown said, "but we could try to bring it to the current price," Dave Frick added. "Or something close to it," Mr. Brown said. Mr. Bode commented that the cash in -lieu -of rate affects the price developers around town pay for other than CBT sources of water, and it tends to affect how much cash the City gets. "Historically we basically try to lag the CBT market for a cash in -lieu -of price," he added. "Now we are from $150-200 behind that price. "How much cash in -lieu -of have we been getting?" Mr. Lauer asked. "In 1995 we received a sizeable amount, about $250,000; it was larger than we've had for quite some time," Mr. Bode replied. "It may be encouraging some developers to turn over cash rather than water stock." "Which goes against the proposed CBT limitation," Mr. Bartholow pointed out. "If we want to get around the limitation, we need to up our price to around $2000," Mr. Frick suggested. "I don't think we would get too much CBT water turned in even with that price; we get mostly other types of water. There is not a lot of CBT water right around Fort Collins; it's mostly southside ditch water," Mr. Bode responded. "If you are going to have to spend the money on water, then you shouldn't be charging much less than what it would cost you to go out and buy the water," Mr. Brown commented. It was concluded that the City's cash in -lieu -of price needs to be re-evaluated. Water Board Minutes March 22, 1996 Page 14 Regional Meeting of Loveland, Greeley and Fort Collins Water Boards Mr. Clopper asked if we have settled on a date for our annual meeting of the regional water boards and staff. Ms. Nortier said a date hasn't been set. Greeley is in the process of hiring a new Utility director, and they don't expect to have one on board for at least 3-4 weeks. "We have been putting off setting a date until we hear something from them. We will try for a date in late May or early June," Mr. Smith concluded. ADJOURNMENT Since there was no further business, the meeting was adjourned at 4:33 P.M. - Water Board ecretary