HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 04/16/2019 - SECOND READING OF ORDINANCE NO. 050, 2019, AUTHORIAgenda Item 4
Item # 4 Page 1
AGENDA ITEM SUMMARY April 16, 2019
City Council
STAFF
Liesel Hans, Water Conservation Manager
Abbye Neel, Water Conservation Specialist
Eric Potyondy, Legal
SUBJECT
Second Reading of Ordinance No. 050, 2019, Authorizing an Annual Water Allotment Management Program
by Amending Section 26-129 of the Code of the City of Fort Collins to Authorize the Utilities Executive Director
to Waive All or Part of the Excess Water Use Surcharge for Certain Qualifying Customers in Limited
Circumstances.
EXECUTIVE SUMMARY
This Ordinance, unanimously adopted on First Reading on March 19, 2019, gives discretion to the Utilities
Executive Director to provide qualified customers a temporary waiver from Excess Water Use (EWU)
surcharges for up to three years, provided the customer participates in the proposed Allotment Management
Program (AMP) to implement a project that permanently reduces the customer’s water use by managing
landscape water use to an existing allotment. The Ordinance and supporting program create a solution for a
specific group of customers that were highly impacted by changes to the Water Supply Requirements (formally
Raw Water Requirements) adopted in September 2017 and implemented in 2018.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on Second Reading.
BOARD / COMMISSION RECOMMENDATION
After First Reading, staff provided information to the Economic Advisory Committee, and presented to the
Water Board and the Natural Resources Advisory Board. Below summarizes the feedback; more details can
be found in the applicable board’s minutes. Given the timing of the presentations, the minutes are unapproved
minutes and may contain errors.
Economic Advisory Committee (information provided only)
• Requested information only and declined offer for a staff presentation.
• Asked clarifying questions but provided no formal feedback or motion.
Water Board, March 21, 2019 (Attachment 2)
• No formal recommendation was made. Only 6 of the 11 members were in attendance and the six were
split in their opinions. The board was supportive but could not come to an agreement on the approach.
• A motion was first made to modify the proposal to allow a waiver in 2019, rather than the proposed start
date of 2020 with 2019 serving as the application period, because the excess water use fees seem
punitive.
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• Some boardmembers were concerned the application requirements were too burdensome and that
participants should instead get the waiver based only on water usage analysis rather than a water use
analysis as well as an application, project plan, project check-ins and the other proposed requirements.
• The motion did not pass because the other boardmembers were concerned a 2019 waiver could be
interpreted as a free pass and felt that the waiver needs to be conditional on customer participation and
actions to reduce water use.
• Staff still recommends the Ordinance as presented during First Reading on March 19, 2019.
o Most customers would not be able to implement a project until 2020 due to budgets, time
needed to vet and acquire contractors, and time to develop a project plan and gain community
support. During the outreach process, stakeholders did not express concern over the
proposed timeline. Staff is available to work with customers that wish to mitigate impacts in
2019 ahead of the 2020 waiver.
o Requirements were developed based on input from a multitude of stakeholders and staff.
AMP’s requirements are necessary to ensure projects provide benefits and are successful.
Similar requirements exist in the already successful residential Xeriscape Incentive Program.
Many of the application components are materials that would be developed by contractors
regardless of AMP’s requirement (e.g., site plan). Staff will support customers throughout the
application process.
Natural Resources Advisory Board, March 27, 2019 (Attachment 3)
• Supports the proposed change in code and the Allotment Management Program.
• Board had several other recommendations related to water use, graywater, and water rates/fees, most
notably that rates and fees should reflect the real cost of water use and staff should prevent issues moving
forward through the development review process.
• Opted to craft a separate memo with its recommendations. (Attachment 4)
ATTACHMENTS
1. First Reading Agenda Item Summary, March 19, 2019 (w/o attachments) (PDF)
2. Water Board Minutes, March 21, 2019 (draft) (PDF)
3. Natural Resources Advisory Board Minutes, March 27, 2019 (draft) (PDF)
4. Natural Resources Advisory Board memo, April 3, 2019 (PDF)
5. Staff memo to Council, March 27, 2019 (PDF)
6. Ordinance No. 050, 2019 (PDF)
Agenda Item 8
Item # 8 Page 1
AGENDA ITEM SUMMARY March 19, 2019
City Council
STAFF
Liesel Hans, Water Conservation Manager
Abbye Neel, Water Conservation Specialist
Eric Potyondy, Legal
SUBJECT
First Reading of Ordinance No. 050, 2019, Authorizing an Annual Water Allotment Management Program by
Amending Section 26-129 of the Code of the City of Fort Collins to Authorize the Utilities Executive Director to
Waive All or Part of the Excess Water Use Surcharge for Certain Qualifying Customers in Limited
Circumstances.
EXECUTIVE SUMMARY
The purpose of this item is to consider an Ordinance that gives discretion to the Utilities Executive Director to
provide qualified customers a temporary waiver from Excess Water Use (EWU) surcharges for up to three years,
provided the customer participates in the proposed Allotment Management Program (AMP) to implement a
project that permanently reduces the customer’s water use by managing landscape water use to an existing
allotment. The Ordinance and supporting program create a solution for a specific group of customers that were
highly impacted by changes to the Water Supply Requirements (formally Raw Water Requirements) adopted in
September 2017 and implemented in 2018.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on the First Reading.
BACKGROUND / DISCUSSION
Water Supply Requirements and Water Allotments
Since the 1960s, the City has required Water Utility customers to meet Water Supply Requirements (WSR). The
WSR is a dedication of water rights or cash-in-lieu (CIL) of water rights to the Water Utility to provide reliable
water supply service to the customer.
Commercial taps that have met the WSR since 1984 also have received an equivalent annual allotment, which
is the annual volume of water a meter (tap) can use without being subject to an EWU surcharge (Code Section
26-129). If a tap uses more water than the annual allotment, the EWU surcharge is applied to water used over
the allotment for the remainder of the calendar year. This charge is in addition to the standard water use rate.
The EWU provides revenue to acquire and develop additional water supplies, such as through the purchase of
additional water rights and/or infrastructure projects to serve the customer beyond what was provided at the time
of development plus any additional allotment volume that has been purchased by the customer.
In September 2017, City Council approved modifications to the WSRs, including an increase in the CIL rate and
the EWU surcharge. (Attachment 1) As a result, the CIL price increased from $6,500 to $17,300 per acre-foot
and the EWU surcharge increased from $3.06 to $8.14 per 1,000 gallons over the allotment.
ATTACHMENT 1
Agenda Item 8
Item # 8 Page 2
Customer Impact Related to EWU Surcharge Increase
Since 1984, about 34% (~1,200) of commercial water taps have annual allotments. In a given year,
approximately 11% of commercial taps exceed their allotment (~350 accounts), however, only ~150 accounts
are highly impacted (annual EWU surcharges over $2,000). Most highly impacted taps are irrigation taps based
on extensive landscaped acreage. Of these irrigation taps, over 70 are associated with homeowner associations
(HOAs) or multifamily complexes where residents, as opposed to businesses, are ultimately responsible for
paying the EWU surcharges.
At the previous rate of $3.06 per 1,000 gallons, customers averaged $1,500 in EWU surcharges. Now, with the
new rate of $8.14 per 1,000 gallons, customers are facing up to $40,000 in EWU surcharges, with the majority
paying about $4,000, and 30 paying over $10,000 annually.
Customer Response to EWU Increase
In 2018, staff estimates that over 1,200 hours were spent addressing customer concerns about the increased
EWU surcharges. Seven complaints were escalated to City Council members. In response, staff committed to
presenting a proposed solution to City Council in Q1 of 2019 (Attachment 2).
Feedback received from customers impacted by the increase in EWU surcharges are summarized as follows:
Dramatic cost increase (166%)
Not enough time to prepare or factor in a solution into their annual budgeting
Significant concern in cases where the allotment is not sized correctly for the use type as depicted in Figure
1. Customers in this situation have an allotment that is too small given the properties’ water needs.
Customers could be watering efficiently but will still receive EWU surcharges because the property simply
needs more water than the allotment. Solutions with significant upfront costs are needed to help a customer
reduce use enough to avoid facing EWU surcharges every year.
Figure 1 - A customer’s Annual Water Use is larger than its allotment resulting in EWU surcharges (depicted in blue
hatching). However, the customer’s water need (depicted in green) is larger than the allotment. Because the customer’s
need is larger than the allotment. the property will always receive excess water use surcharges unless a large change is
made.
Rationale for Ordinance and Proposed Allotment Management Program (AMP)
Existing water conservation programs can help customers who receive EWU surcharges due to inefficient water
use. Resources are not available, however, to assist customers with an allotment that is not sized correctly, as
depicted in Figure 1, which are often HOAs with irrigation taps that support significant landscaped acreage. To
avoid paying surcharges, customers must either 1) pay the EWU surcharges, or the current CIL rates to increase
their allotment or 2) implement water conservation projects to reduce their water use.
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Example: An HOA in Fort Collins has a 2-inch tap with an allotment of 3.1 million gallons. Analysis shows that
the current landscape needs a minimum of 6.7 million gallons. The HOA can:
1. Pay the excess water use surcharges, $25,000 per year; or
2. Pay the CIL rate to permanently increase their allotment, $367,000; or
3. Implement a conservation project to reduce use to or below allotment, $75,000 over the course of three
years to reduce landscape need to 2.8 million gallons.
On average, highly impacted customers face $7,500 in annual EWU surcharges. The cost for these customers
to increase their allotment is ~$100,000 or more. Most HOAs do not have the reserves available to fund the
yearly EWU surcharges long-term or to pay to increase their allotment. Through stakeholder outreach, staff has
identified that many of these customers would like to implement a water conservation project, but customers
stress they cannot finance water conservation projects and pay EWU surcharges at the same time. The proposed
AMP would support these customers by providing a temporary exemption from EWU surcharges while customers
implement water savings projects to reduce their water use permanently.
Proposed Allotment Management Program (AMP)
Staff proposes a change to City Code that would give the Utilities Executive Director the discretion to provide a
customer a temporary exemption from the EWU surcharges for up to three years if they meet specific
requirements and subject to certain limits. During the exemption period, customers will be able to redirect funds
that would have been used to pay EWU surcharges into a water conservation project.
Customer enrollment in the AMP is proposed as follows:
Customers with commercial rate codes (including irrigation taps) are eligible to apply with a plan for
permanent reduction in outdoor water use.
Staff determines and recommends to Utilities Executive Director if customer and project qualify.
Qualifications include:
o Customer demonstrates need (e.g., customer’s water tap is undersized as depicted in Figure 1).
o Project is reasonable and demonstrates long-term reduction in outdoor water use.
If the project qualifies, the customer receives a temporary exemption from EWU surcharges for up to three
years depending on project scope. If granted, a multi-year project, exemption will be tiered (e.g., 100%, then
50% for a 2-year exemption).
Customers who do not complete a project or meet project milestones outlined in a customer agreement will
be billed for any applicable EWU surcharges.
A sample draft application with detailed requirements can be found in Attachment 2. If approved, customers will
be able to complete and file an application for exemption with the Utilities Executive Director on or before
December 31, 2022. Throughout the program, staff will provide Council with quarterly updates on participants’
progress.
Staff believes this is the optimal solution for customers and the Water Utility because:
1. As the cost of water supplies and infrastructure rise, the cost of WSRs and the associated EWU surcharges
will continue to increase, which may result in customers abandoning landscapes, as we’ve seen in other Front
Range communities, or have other impacts on residents. AMP provides a proactive solution that helps
customers adapt to increasing costs while increasing community resiliency to drought and a changing climate.
2. AMP is a cost-effective way to reduce the additional water resources the Water Utility must develop to
compensate for use beyond what was initially provided at the time of development or otherwise provided by
a customer since development. AMP helps the Water Utility avoid some future costs of developing water
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supplies, costs which are expected to continually increase.
AMP also aligns with key City Strategic Objectives related to Environmental Health and High Performing
Government and with Council-adopted Plans, including the Water Supply and Demand Management Policy and
the Water Efficiency Plan.
CITY FINANCIAL IMPACTS
The program will decrease the revenue Water Utility collects via EWU surcharges. If projects are successful, the
revenue will not be needed because the Water Utility will not need to supply the customer with additional water.
Based on the average number of customers that exceed their allotment (~350), the maximum financial
implication if every customer were to apply, qualify, and not complete a project with a long-term water reduction
would be $1.2 million. However, based on analysis of water use and the number of customers who have
expressed interest, staff expects around 50 customers to qualify and participate. If each of these customers
applied, qualified, and did not complete a project with long-term water reduction, the revenue implication would
be $370,000.
To mitigate the financial impact and ensure projects are successful:
A decreasing tiered exemption will be implemented for multi-year projects to lower the risk of providing a
multi-year exemption (e.g., 100% then 50%) and encourage the proper establishment protocol.
Customers will be back-billed if they do not complete their projects.
The exemption is only for a limited period, i.e., up to three years.
Customers will sign agreements to meet milestones and have regular progress check-ins to ensure projects
are completed. (see requirements in Attachment 2)
Staff has a successful record in supporting customers in landscape change through the existing residential
program, the Xeriscape Incentive Program (XIP). Preliminary analysis estimates these projects reduce use
by 14 gallons per square foot per year. XIP was studied along with many other landscape transformation
programs across the nation as part of an Alliance for Water Efficiency study. The report shows a savings of
up to 39% and more if participants have access to education and support at the start of a project.
BOARD / COMMISSION RECOMMENDATION
On December 20, 2018, the Water Board unanimously recommended that staff develop the AMP. (Attachment
3) Its primary recommendations were to: (1) ensure program was equitable to all commercial customers, (2)
customers had ample notification of the program, and (3) staff analyzed eligibility on a case-by-case basis. Staff
have incorporated these recommendations into the program.
On February 25, 2019, the Council Finance Committee unanimously approved the program and recommended
staff present the program at the March 19 Council Session due to current Council’s familiarity with the issue and
to ensure customers have ample time to plan. (Attachment 4)
Given the Council Finance Committee’s recommendation, staff’s planned visits to the following boards will occur
after the first Council reading. The boards were presented with a memo and opportunity to provide Council with
feedback prior to March 19. All feedback will be incorporated into the Second reading Agenda Item Summary.
Economic Advisory Commission, March 21
Water Board, March 21
Natural Resources Advisory Board, March 27.
PUBLIC OUTREACH
Agenda Item 8
Item # 8 Page 5
Utilities staff presented AMP to key stakeholders, including property managers, HOA community members,
Utilities key accounts, businesses affected by the change, the landscape contractor community, and other
affected City departments (Forestry, Parks, Development Planning, Natural Areas, and Zoning). A detailed
summary can be found in Attachment 6.
Input has been very supportive of the proposed program. The following summarizes input followed by staff notes:
Ensure that the assigned annual water allotment matches the expected water use at the time of
development in the future.
o Via a separate effort, Utilities staff is researching and analyzing improvements to the
development review process in partnership with Development Review.
Need a solution early in 2019 to allow affected customers time to plan prior to irrigation season.
o By moving up the first reading, staff will be able to notify customers in late April of the program
status. This will allow more customers to successfully develop plans in 2019 and implement in
2020.
Need educational services and support for customers participating in programs.
o Staff has a successful record of supporting customers through existing programs like the
Xeriscape Incentive Program. Staff also is actively developing additional resources to support
this class of customer in conjunction with other subject matter experts across the City, within
our community (e.g., CSU), and in the region (e.g., Northern Water).
Concerns from City departments (e.g., Forestry, Natural Areas, and Parks) regarding potential impacts
to vegetation and tree loss if customers stop watering landscapes.
o Staff has met with departments to ensure AMP requirements address their concerns. If passed,
staff will continue to leverage other departments’ expertise to address specific customer
situations as they arise.
ATTACHMENTS
1. 2017 Water Supply Requirment Update (PDF)
2. 2017 Memos in response to customer concerns (PDF)
3. Allotment Managment Program Application and Requirements (PDF)
4. Water Board minutes, December 20, 2018 (PDF)
5. Council Finance Committee minutes, February 25, 2019 (PDF)
6. Public Outreach Summary (PDF)
Excerpt from Unapproved DRAFT MINUTES - WATER BOARD
REGULAR MEETING
March 21, 2019, 5:30 p.m.
222 Laporte Avenue, Colorado River Community Room
03/21/2019 – Excerpt from Unapproved DRAFT MINUTES Page 1
Allotment Management Program (AMP)
(Attachments available upon request)
Presentation Summary: Water Conservation Specialist Abbye Neel provided an
update on developments in the water AMP since the staff presentation to Water
Board in December. Staff presented the item to City Council on March 19 for the
first reading and will provide more information at the second reading on April 16.
The allotment is related to water supply requirement equivalent for taps installed
after March 1, 1984. A tap can use a certain annual volume of water before
being subject to an Excess Water Use surcharge. Staff began customer
outreach and education in 2017 before the surcharge went into effect in 2018.
Many of the customers who have been charged the excess use surcharge are
homeowners associations and the reason is due to a tap that is not the right size
for the development. The AMP will begin in June if approved by City Council on
April 16.
Discussion Summary: Board members commented on and inquired about
various related topics including whether developers have miscalculated the
amount of water needed for some time. Ms. Neel replied it has been an ongoing
issue that is concurrently being addressed by staff outside of AMP; developers’
desire to keep costs down; the number of customers affected (about 50); a
desire to give customers the benefit based on before and after water use rather
than making them jump through so many hoops required in the AMP (Ms. Neel
replied that the AMP requirements are to ensure customers’ projects will
succeed); suggestion of a new ordinance requiring the wrong-size tap/allotment
be declared before a prospective homeowner buys; no additional plant
investment fees unless tap size is increased; project timeline; a suggestion to
waive the fee in 2019 because excess use fees seem punitive and some
customers were unaware of the surcharge despite outreach and education (Ms.
Webb stated she would take the idea to the Utilities Strategic Finance Director
for consideration); suggestion to implement the excess use fees after the AMP
helps customers reduce water usage.
Board Member Primsky moved that the Water Board supports the proposed
change in code and Allotment Management Program to Council with
modifications to either waive or mitigate the excess water use fee in 2019.
ATTACHMENT 2
WATER BOARD
REGULAR MEETING
03/21/2019 – Excerpt from Unapproved DRAFT MINUTES Page 2
Board Member Kuiken seconded the motion.
Discussion on the Motion: A board member inquired whether some progress
could be made in the management program in 2019 and expressed concern about
not sending a strong enough message, resulting in lack of action by customers to
decrease water use.
Vote on the motion: It did not pass, 3-3.
Reasons for No votes:
Board Member Malers: We don’t want [a suggested 2019 fee waiver] interpreted as
a free pass and we lose a year to make progress. It’s OK to have a penalty but how
do we encourage customers to work with staff and make progress?
Board Member Steed: I agree. A fee waiver needs to be subject to customers’
participation in the AMP or actions to reduce water use.
Board Member Ortman: I agree. There needs to be some recognizable participation.
NATURAL RESOURCES ADVISORY BOARD
Unapproved DRAFT
REGULAR MEETING
March 27, 2019 6:00pm
300 Laporte Avenue, Council Information Center – Note Room Change
MARCH 27, 2019 – Unapproved DRAFT MINUTES Page 1
1. CALL TO ORDER by Nancy at 6:02 pm
Board Members Present:
Jay Adams
Drew Derderian
Elizabeth Hudetz
Luke Caldwell
Danielle Buttke
Nancy DuTeau
Barry Noon
Kevin Krause
Bob Mann
Board Members Absent:
Staff Members:
Lindsay Ex
Guests:
Dan Konzek, Community member
Karen Artell, AQAB
William C Bladin, Community member
2. AGENDA REVIEW
Reviewed aloud by Nancy
Welcome new member Kevin Krauss
3. COMMUNITY MEMBER PARTICIPATION
None
4. APPROVAL OF MINUTES
Correction on February Minutes: page 4, Looking at fracking, and bids that are coming in. Polis
is now stating that the cities should have a say in whether they allow fracking; he will not sue
cities who will allow fracking. While they are still functional, this needs to be addressed. Air
quality will become a larger problem.
Luke moves to approve minutes, as amended, Danielle 2nd, unanimous
5. NEW BUSINESS
a. Water Allotment Management Program
Abbye specifically serves commercial customers with water conservation.
Allotment Management Program - AMP
- Review Allotments and Excess Water Use (EWU) surcharge
ATTACHMENT 3
BOARD NAME
TYPE OF MEETING – (REGULAR, WORKSESSION, SPECIAL)
March 27, 2018 – Unapproved DRAFT MINUTES Page 2
- Review customer response
- Allotment Management program (AMP)
- Motion to council
o Had first reading on consent agenda last week, advised to review with boards to
get board opinions. Next reading is April 16th
- Water Supply Requirements – (raw water requirements)
- Dedication of water rights or CIL of water rights to the water utility to provide reliable
water supply series to the customer
- Two methodologies
o 1960-84 was just based off of acreage
o 1984 changed to acreage and the estimated water use for type of property
- Strictly for commercial customers
- Allotment
- WSR equivalent for commercial taps installed after 1984
- Annual volume of water a tap can use before being subject to surcharge
o Not punitive, allows utility to recoup the cost
- Surcharge applied to all water used over the allotment
- Increased from $12,500 to $33,400 per acre-foot
- Increased from $3.06 to $8.14 per 1,000 gallons
o This is why there was a need for a solution
- Commercial Water Allotments
o Through year customer receives water at regular rate, and when they exceed the
allotment, they receive the surcharge, cost of water triples.
o 34% of an allotment
o 11% receive EWU
o 3% highly impacted
HOAs and Sprinkler taps (owned by a business, often for irrigation)
- Customer impact
o Inefficient Use
o Allotment is not sixed correctly for the use type – a customer has allotment,
exceed when they do, the challenge is that what their land needs, even with
efficiency are exceeding allotments. Often large landscaped spaces.
- Questions: How is demand effected based on variable water demand and significant
temporal trend? Do not use forecasting models, demand varies over time, various
climate models? Do you work with CSU water center? (Answer) Some of their research
is not scaled down enough for this.
- There is currently no plan for excess water fees
- Customer Outreach & Feedback
o Increase was a lot
o Time given to implement solution wasn’t enough time
o If solution isn’t implemented, folks will be forces to stop watering landscapes.
o A lot of interest in changing landscape to less water needing native plants,
xeriscape
Establishment period for plants, will continue to exceed allotment, would
be a multiyear project, not simply over one season.
BOARD NAME
TYPE OF MEETING – (REGULAR, WORKSESSION, SPECIAL)
March 27, 2018 – Unapproved DRAFT MINUTES Page 3
ELIZABETH - Xeriscape is possible in steps, saves a lot of water, even more long term
- Rationale
o Example 1 (The numbers in options are EXAMPLES ONLY)
Need 6.7M gallons
Allotment is 3.1 M gallons
Excess water Use is $25K
o Option 1 Pay 25K in excess in water use fee each year
o Option 2 Pay $366,000 to increase allotment (one-time fee, increases allotment
forever)
o Option 3 Pay $75K to implement water conservation project (Landscape
conversion)
BARRY – How is option 2 calculated? Could be a really good deal, what accounts for
expediential curve?
Finance has estimated the projection cost for a limited time
NANCY – Raising the fees, will they go up?
Rates are figured based on cost to distribute and treatment (infrastructure)
LUKE – Doesn’t actually seem like a high rate, when looked at per capita
DANIELLE – we are not accounting for cost of the impact that we have on natural
resources, current pricing structure is accurate at all, and option 2 does not touch what
the cost should be
BOB – Option 2 appears to be a reflection of 1984, how is perpetuity factored in?
Will take it back to finance team
LINDSEY – Rational above is an example, not a policy option.
- These “options” are current policy, AMP, what we are hear for today, is different and
really just a part of option 3. This would be a big change based on utility cost.
- There is a team to assure that developers are not underpaying.
- There is a larger issue that only 1/3 of customers have an allotment, based on the 1984.
- Trying to give customers who are in this situation a solution as soon as possible, these
other pieces are part of a bigger picture.
NANCY – As part of Option 3, this is creating the roadmap of culture conservation
project choices.
- AMP Structure
o Eligible customers submit a plan for long term permanent water reductions
o Staff determines if customer and project qualify
o Reduces water use
o If project qualifies, customer receives a temporary exemption from excess water
use fees
o Max exempt is 3 years and is based on scope of project
o Customers who do not complete project will be billed for any applicable excess
water use fees
o Utility will have the availability to back-bill when necessary for risk mitigation
ELIZABETH – would another option be to go back to contractor/builder and let them pay
the difference? Many of those developers from the 80’s are long gone.
o Customers have been receiving this since 1984, but the city had not heard from
anyone until the recent rate increase
BOARD NAME
TYPE OF MEETING – (REGULAR, WORKSESSION, SPECIAL)
March 27, 2018 – Unapproved DRAFT MINUTES Page 4
BARRY – In favor of positive incentive program, would like to see added “conservation
easements” to receive a tax incentive to do so, but for that to work there needs to be
long term monitoring to ensure compliance ongoing. This would create an ongoing cost
to the city to monitor, which would need to be built into original cost. Often a 30-year
time horizon to prevent a creep in non-compliance.
- One requirement to participate is for them to sign up for online water monitoring AND
“landscape budge program”, with monthly water use compared to weather – this will
mitigate some of this. Since they are only exempt for a limited time, they will be subject
to the fees again.
DANIELLE – City has not adopted grey water policies and we are missing opportunities
to build that into new properties
KEVIN – Goals for this seem right, for HOAs as an example, this is a significant cost
and should work for reduction. Wouldn’t the goal be to get water use as low as
possible?
o As a conservation oriented group, we have more focus than some communities
in town, who may not be as focused on low use, ultimately it is up to the
customer how they want to proceed with water use
- AMP Benefits and Risks
- Program Benefits
o Create solution for group of affected customers
o Increases community’s drought resiliency and conservation ethic
o Cost-effective way to reduce volume of water that hasn’t been accounted for at
development
- RISK
o Number of Customers who are engaged is less than 50, and the temporary
revenue implication is less than $400,000
o Customers that exceed annually is around 350, max impact is about 1.2 million
o Total customers about 3500 customers
o High impacted group around 150 customers
- Timeline/Next Steps
- Started in 2018, work sessions with water board and outreach
- First council reading March 19th
- NRAB is last board stop
- Program Launch June 2019, open for applications
o Would give people who want to implement solutions time to do so, before that
allotment typically hits in September, some will wait until 2020.
BOB – of 50 that are engaged- how many? 30 HOA’s and 20 businesses
KEVIN – compared to non-engaged? 70 are HOA’s and the remaining of the 3500 are
businesses, (HOAs are almost always irrigation taps)
ELIZABETH – if people would do true native xeriscape it would really eliminate so much
of this
LUKE – would like to see the back billing a bigger consequence
ELIZABETH – can new builders be given an incentive to do xeriscape or zeroscape
from the very beginning?
BOARD NAME
TYPE OF MEETING – (REGULAR, WORKSESSION, SPECIAL)
March 27, 2018 – Unapproved DRAFT MINUTES Page 5
NANCY – Who works with HOAs to get this work done? Referred to Danielle’s
comments from the parks service and outreach will be done most by Abbye’s dept.
KEVIN – If someone takes advantage of the program, city back bills them, sends it to
collections, is there any bonding or any way to prevent the utility from? Would be a lien,
the safety net.
- Abbye needs NRABs message by April 4th.
- Proposed: “I move that the NRAB supports the proposed change in code an Allotment
Management Program to Council as with additional recommendations which will be
provided in a separate memo to council.”
- ACTUAL NOTES: NRAB supports the proposed program and recommends the
following: (based on feedback from meeting minutes). Grey water would be significant,
encourage the city to encourage the county to include grey water and should be an
option for funding if and when the program succeeds. Important to add the language
about grey to keep it; ensuring contractors are accountable at time of development.
NRAB feels that Option 2 does not represent the true cost of water and should be
readdressed. Board encourages additional engagement on the actual cost of water use
in a long term objective, even beyond option 2.
- BARRY NOTE: If you increase the allocation, that is less water that is available for the
rest of that natural world, and it’s a finite resources which cannot be recreated- he would
like to see a slide in the future about the REAL cost of water use which include
economic values along with fundamental human health and conservation. If someone
else gets more water, some aspect of our community is going to have less.
- ELIZABETH – insect loss and pesticides will also be reduced by more zeroscape or
xeriscape, and should be included in the recommendation to council as an incentive to
new contractors/builders.
- DANIELLE will provide this to Abbye based on member comments and minutes.
Barry moves to send memo (prepared by Danielle) to Abbye, Bob 2nd, unanimous
b. Regional Wasteshed Update
- Strategic Plan Goals Impact the strategic plan support and drive this work,
- Very important to know we are misplacing a lot of things in this community.
o 2016, about half of homes and businesses are misplacing waste
o 2016, about half of industrial are misplacing recyclable
- Wasteshed Coalition
o TAC Technical Advisory Committee
o PAC Policy Advisory Committee
o Stakeholder Advisory Group
o Created a MASTER PLAN for solid waste infrastructure to decide what to do when
the landfill is full and closes, adopted by Larimer County in 2018.
- Stakeholder engagement
o Strongly supports master plan
- Larimer county capital investments
o New landfill
Environmental Services
222 Laporte Avenue
Fort Collins, CO 80521
970.221-6600
fcgov.com
MEMORANDUM
NATURAL RESOURCES ADVISORY BOARD
DATE: April 3, 2019
TO: Mayor and City Council Members
FROM: Natural Resources Advisory Board
SUBJECT: Proposed Allotment Management Program Code Change
Dear Mayor and Council Members,
The Natural Resources Advisory Board (hereafter NRAB) supports the proposed change in code
of the Allotment Management Program to allow a waiver in excess use surcharges for customers
voluntarily investing in water savings features with the following proposed amendments:
We strongly encourage council to consider writing grey water infrastructure and strategies into
the Allotment Management Program’s acceptable strategies and adopt the state guidelines on
greywater use. Grey water systems have tremendous long-term positive impacts on water use
with little to no requirements for human behavior change or available water for household use.
The Board encourages council to consider adoption of these guidelines in a timely manner to
maximize the impact due to the increased visibility and awareness the Allotment Management
Program code changes will bring.
Additionally, the Board believes it is important that allotment sizing is appropriate at the time of
property development, and encourages addition to code to hold developers accountable for
intentionally under-sizing allotments to reduce development costs of a property. Finally, while
we recognize that adjusting allotment allocation and pricing structure is outside the scope of the
current proposed amendments, we believe it is critical that council considers additional
engagement and review of allotment pricing structure to incorporate both currently externalized
costs of water as well as climate change and land use projections that will continue to reduce the
availability of this finite resource and dramatically increase costs and conflict. Failure to
incorporate these long-term projections will result in more significant cost increases and lack of
equity in access to this critical resource that significantly affects quality of life and livelihood of
all citizens.
Very Respectfully,
Danielle Buttke
Vice-Chair, Natural Resources Advisory Board
cc: Darin Atteberry, Lindsay Ex
ATTACHMENT 4
ATTACHMENT 5
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ORDINANCE NO. 050, 2019
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING AN ANNUAL WATER ALLOTMENT MANAGEMENT
PROGRAM BY AMENDING SECTION 26-129 OF THE CODE OF THE CITY OF
FORT COLLINS TO AUTHORIZE THE UTILITIES EXECUTIVE DIRECTOR
TO WAIVE ALL OR PART OF THE EXCESS WATER USE SURCHARGE FOR
CERTAIN QUALIFYING CUSTOMERS IN LIMITED CIRCUMSTANCES
WHEREAS, the City owns and operates Fort Collins Utilities, including a water utility that
provides treated water service to customers pursuant to the City Code and other applicable law,
rules, and regulations; and
WHEREAS, water service permits are issued to customers of the water utility for either
residential service or nonresidential service, which nonresidential service includes water service
for commercial, irrigation, and other purposes, as indicated in City Code Section 26-149(a); and
WHEREAS, water service permits applied for since March 1, 1984 by nonresidential users
are to have received an annual allotment, as set forth in City Code Section 26-149(d); and
WHEREAS, as set forth in City Code Section 26-149(d), when a nonresidential user uses
more water than its annual allotment, as determined by monthly billing records in a given calendar
year, an excess water use surcharge in the amount prescribed in City Code Section 26-129 will be
assessed on the volume of water used in excess of the annual allotment; and
WHEREAS, funds acquired from the excess water use surcharge are used to acquire and
develop water supplies, an underlying policy goal of which is to manage and equalize the supplies
and demands for treated water from the water utility; and
WHEREAS, certain customers of the water utility for nonresidential service for irrigation
purposes with annual allotments have experienced challenges with the excess water use surcharge,
in particular, being customers who have and are anticipated to exceed their annual allotments for
current uses and landscaping when employing practices to efficiently use water for irrigation
purposes; and
WHEREAS, some of these customers may be able to reduce the amount of water they use
for irrigation purposes, including by modifying landscapes, but require adequate time to plan and
budget for such projects in their annual planning and budgetary processes, and would benefit from
being able to fund such projects with money that would otherwise be spent on paying excess water
use surcharges; and
WHEREAS, water conservation and efficiency are tools that are used by the water utility
to manage and reduce the demand for treated water, which is beneficial to the water utility and its
ratepayers by, among other reasons, helping to ensure that the demand for treated water does not
exceed supplies, which could result in more shortages and other adverse impacts; and
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WHEREAS, a temporary waiver of the excess water use surcharge for certain such
customers will be beneficial to the water utility and its ratepayers by managing and reducing the
long-term demand for treated water by such customers through allowing such customers to spend
the money that would have been spent on the excess water use surcharge on other means to reduce
their demand for treated water out into the indefinite future, thus achieving the same underlying
policy goal of the excess water use surcharge of balancing the supplies and demands for treated
water from the water utility; and
WHEREAS, such long-term benefits to the water utility and its ratepayers outweigh any
short-term reductions in foregone excess water use surcharge revenues; and
WHEREAS, staff of the water utility and the City Manager have recommended to the City
Council that the City Code be amended as described below in order to address the issues described
above.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1. That the City Council hereby makes and adopts the determinations and
findings contained in the recitals set forth above.
Section 2. That Section 26-129 of the Code of the City of Fort Collins is hereby
amended to read as follows:
Sec. 26-129. - Schedule D, miscellaneous fees and charges.
[…]
(h) Notwithstanding the provisions of this Section or § 26-149, the Utilities Executive Director
may waive payment of all or portions of the excess water use surcharge of Subsection (c)(2)
pursuant to this Subsection (h).
(1) A customer of the water utility with nonresidential water service seeking such a
waiver shall, on or before December 31, 2022, complete and file with the Utilities
Executive Director an application accompanied by any required filing fee as
determined by the Utilities Executive Director. The Utilities Executive Director
shall prepare a form of such application identifying for the applicant all of the
necessary information for the Utilities Executive Director to evaluate the requested
waiver.
(2) The Utilities Executive Director may, following any appropriate investigations
including requests for additional information from the applicant, waive payment of
the excess water use surcharge by the applicant if the Utilities Executive Director
finds that the following conditions are met:
a. The application was timely filed and complete;
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b. The applicant is expected to exceed its annual allotment for its current uses
and landscaping when employing practices to efficiently use water for
irrigation purposes without waste;
c. The applicant has an adequate and detailed plan to reduce the use of water
for irrigation purposes for the indefinite future as determined by the Utilities
Executive Director;
d. The applicant and the Utilities Executive Director have executed a written
agreement consistent with this Subsection (h) setting forth such plan and
other related matters, with such agreement being approved as to form by the
City Attorney.
(3) Any such waiver shall be set forth in the written agreement and shall be subject to
the following:
a. A finding by the Utilities Executive Director that the waiver will be
beneficial to the water utility and its ratepayers by implementing the
applicant’s approved plan to manage and reduce the demand for treated
water by the applicant through allowing the applicant to spend the money
that would have been spent on the excess water use surcharge on the actions
set forth in the approved plan to reduce the applicant’s demand for treated
water out into the indefinite future.
b. Such a waiver may only waive all or part of the excess water use surcharges
for up to three (3) years. A one (1) year agreement shall waive one hundred
(100) percent of the excess water use surcharges. A two-year agreement
shall waive one hundred (100) percent of the excess water use surcharges
in year one (1) and fifty (50) percent of the excess water use surcharges in
year two (2). A three (3) year agreement shall waive one hundred (100)
percent of the excess water use surcharges in year one (1), sixty-six (66)
percent of the excess water use surcharges in year two (2), and thirty-three
(33) percent of the excess water use surcharges in year three (3).
c. Such a waiver shall include a detailed plan to reduce the use of water for
irrigation purposes for an indefinite period as determined by the Utilities
Executive Director.
d. Such a waiver shall be revocable, in whole or in part, by the Utilities
Executive Director at any time due to: a failure of the applicant to comply
with the terms of the waiver; customer agreement; or other good cause as
determined by the Utilities Executive Director. Such a revocation shall be
in writing and set forth the reasons for the revocation and, if the waiver is
revoked in part, any new or modified terms. Upon such revocation, the
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Utilities Executive Director may bill the applicant for any excess water use
surcharges that were to be waived.
e. Such a waiver shall have no effect on the annual allotment or Water Supply
Requirement for the subject premises.
(4) If an application for such a waiver is denied, the Utilities Executive Director shall
notify the applicant in writing of the denial and state the reasons therefor.
Introduced, considered favorably on first reading, and ordered published this 19th day of
March, A.D. 2019, and to be presented for final passage on the 16th day of April, A.D. 2019.
__________________________________
Mayor
ATTEST:
_______________________________
City Clerk
Passed and adopted on final reading on the 16th day of April, A.D. 2019.
__________________________________
Mayor
ATTEST:
_______________________________
City Clerk