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HomeMy WebLinkAboutMinutes 1987-05-20•- CO~S~ITATION DI~I~~.3 OF ORANGE couNIY,CALIFORNIA MINUTES OF ADJOURNED REGULAR MEE~PING May 20,1987 —7:30 p.m. 10844 Ellis Avenue Fountain Valley,California Pursuant to adjournment of the regular meeting of May 13,1987,the Board of Directors of County Sanitation District No.3 of Orange County,California, met in an adjourned regular meeting at the above hour and date. The Chairman called the meeting to order at 7:30 p.m.The roll was called and the Secretary reported a quorun present. DIREL”flDRS PRESENT:Richard Polis,Chairman,Frank Clift, Norman E.Culver,Don R.Griffin,Dan Griset,John Kanel,James Neal,Chris Norby,Sal Sapien,J.R.“Bob”Siëfen, Roger R.Stanton,Charles Sylvia and Dorothy Wedel DIRECIORS ABSENT:Ben Bay,Jack Kelly and Carrey Nelson STAFF ME~’4BERS PRESENT:J.Wayne Sylvester,General Manager, Rita J.Brown,Secretary,William H. Butler and Thauas M.Dawes GPHERS PRESENT:Joe Hartge and Bruce Boc’~nan ****************** Review of Master Plan of Trunk Following a briefing by the General Sewers to serve the District Manager on the master planning utilized by the District to assure that the sewerage facilities needed to serve the cannunities within the District and canply with applicable regulatory requirements are properly planned for and constructed, the Director of Engineering reviewed the current Master Plan of Trunk Sewers adopted in 1983,and the status of the District’s rehabilitation program. In the next fiscal year an update of the Master Plan for the Joint Works and each of the individual Districts including District 3’s collection system is planned. New land use plans will be developed based on information which will be obtained froa~t each.of the cities and the County. In 1983 a study was ccztipleted which identified several new interceptor sewers that would be required,but rrcst of them have not yet been constructed.Land use changes in the last few years have been dramatic in the carinunities served by the District and the revised general plans of the cities reflect additional developi~nt and much higher densities.Staff has therefore recorrinended delaying construction of new facilities until such time as the master plan update is completed. The 1983 report also recarniended that County Sanitation District No.3 sell capacity in the Knott Interceptor to Cour~ty Sanitation District No.2.At that time it was believed that the Knott Interceptor would have sufficient capacity -~-~-~---~1r District 3 05/20/87 for District No.2 ‘s use However,because of the aforementioned land use changes taking place,District No.2 has restudied its drainage areas and has determined that it will build a new sewer line in Euclid Avenue which eliminates the need for capacity in the Knott Interceptor.This change fran the 1983 Plan was approved because it was felt that the available capacity in the Knott Interceptor would be needed by District No.3 in the future. In April of this year the District awarded the third contract for rehabilitation of vaults on the Miller—Holder Trunk Sewer.The sewer was built in 1959 with polyvinyl chloride (PVC)liner but the PVC was not placed in the manhole vaults. The $4.3 million contract includes rehabilitation of 73 vaults,sane of which are located in the busiest street intersections in western Orange County,that will be refurbished and lined. There are 250 vaults and manholes on the Miller-Holder Trunk Sewer.Twenty vaults were rehabilitated under the two previous contracts.The remaining work will be less costly on a unit cost basis since the structures which had suffered the highest degree of deterioration were undertaken first. Mr.Dawes reviewed further rehabilitation work needed on the Los Alaniltos Subtrunk Sewer in Los Alamitos Boulevard where the pipe is cracked south of Orangewood Avenue;and on the Westside Relief Interceptor Sewer in Moody Street south of Crescent Avenue where the line is cracked beneath a railroad crossing. Plans for the work were approved by the Directors at the May 13th Board Meeting. The estimated cost is $150,000. The Director of Engineering then reported that there are two areas in Districts Nos.3 and 11 for which service area exchanges should be considered.The first area,within District No.11 and served by District No.3 facilities,includes Q approximately 850 acres west of the Santa Ana River and generally south of Hamilton Avenue.The second area,within District No.3 and served by District No.11 facilities,includes approximately 1,060 acres,850 of which are served by the Slater Pump Station.This area,large portions of which are undeveloped,is bounded by Garfield Avenue on the south,Beach Boulevard on the east and Central Park on the north. Mr.Dawes reported that staff is studying alternative ways to accunmodate these service areas which could include a collector trunk capacity purchase/sale in the serving—District’s facilities;creation of special zones to balance connection fees;or annexation/deannexation in order that District boundaries more closely resemble service areas.The staff is just beginning preliminary studies and will be reporting back to the Boards of Districts 3 and 11 at future meetings. The Board then entered into a general discussion of the master planning,the rehabilitation work and the issue of service areas between Districts during which staff answered several questions that were posed by the Directors. Review of long-range financial The General Manager provided an overview projections re capital and of the District No.3 financing operating requirements programs.The capital costs of constructing the trunk sewer collection system and the share (approximately .one—third)of the joint works treatment plant costs have historically been financed by a variety of sources including issuance of long—term debt securities;portions of the ad valorem tax;construction grant monies;and connection fees.Operating costs are currently financed by the —2— District 3 05/20/87 District’s share of the ad valorem taxes.Mr.Sylvester stated that the effects of Proposition 13 are beginning to impact the District’s ability to finance the rising costs of sewage service brought about by certain inflationary trends and stricter requirements of federal and state regulatory agencies for advanced treatment.Ad valorem taxes are no longer available to allocate to capital costs and are now totally appropriated to cover operating costs.Mr.Sylvester also provided an overview of the District’s practices for projecting short and long—term funding requirements and the financing strategies utilized by other Districts in the Joint Administrative Organization that have found it necessary to implement additional sources of revenue to assure the financial integrity of those Districts. The Director of Finance then reviewed the long—range financial projection schedules and provided an overview of the District’s financial position for the next ten years based on existing fee structures and several alternative new and/or escalating fee structures •He reported that without a program of systematic fee adjustments over the next several years,the District will experience revenue shortfalls in the capital and operating funds and the District’s financial integrity will be jeopardized. Mr.Butler reviewed fee schedules in effect in other Districts and advised the Directors that the Board should consider adjustments to the District’s connection fee program,whereby developers pay a one-time connection fee to finance the planning,design and construction of expanding the facilities necessary to accarniodate the flow generated by the new deve1o~zrent,which presently has in effect the following fee schedule: Single/Multi—Family Carniercial/Industrial Dwelling Units Governmental/Other $250 per dwelling $50 per 1,000 sq.ft. The Director of Finance further reported on the District’s need to consider additional funding sources such as a supplemental user fee program in the next few years to avoid a projected deficit beginning as soon as 1989 in the District’s operating fund.The anticipated deficit could reach as much as $49 million by 1995—96 unless additional revenue sources are generated.He also reviewed various ways of collecting alternative revenue sources to finance shortfalls in the District’s operating fund when ad valorem tax revenues are insufficent to pay the District’s operations,maintenance and replacement costs. The irost cost-effective method (and the method already adopted by Districts 1,5, 6 and 13)is to place a supplemental user fee as a special assessment on the County of Orange property tax bill issued annually to all property ~ners in the County. Mr.Butler further reviewed the District’s cash position should the Directors choose to implement the following proposed supplemental user fee schedule which is similar to the fees adopted by the other Districts that have found it necessary to implement user fees to make up funding shortfalls: —3— —————______________ District 3 05/20/87 1988—89 Class of User Basis of Charge Annual Rate* Single—Family Charge per Dwelling $26.40 ()H Dwellings/Condaniniums Unit Multi-Family Charge per Dwelling 15.85 Dwellings/Apartments/Unit Mobile Hares Camiercial/Industrial/Charge per 1,000 18.90 Other (governmental sq.ft.of building buildings,utilities, non—profit organizations,etc.) *Identical to Districts 1 and 5.District 6 adopted this rate in 1983 but has found it necessary to increase by 20%.District 13,which receives no ad valorem taxes,is $70/year. The Board then entered into a lengthy discussion relative to various events that have impacted the District’s financial position in the past and events that may impact it in the future including state and federal regulatory requirements and develo~ent within the District;and how modifications to the Districts long-range financial plans might be made and implemented.Also reviewed were cost-cutting measures that have been implemented by the Districts to keep expenses down. It was then moved and seconded: That the Board establish a supplemental user fee of $24.00 per dwelling unit effective in 1988—89 and increase it to $30.00 per dwelling unit in 1990—91,and that the existing connection fees be increased to $1,000 per dwelling unit in 1987—88 for single/multi—family dwelling units and $300 per 1,000 sq.ft.of c~nmercial/industrial/governmenta1 buildings,and that said fees be increased to $1,500 and $500,respectively,in 1989—90,following an annual review of the District’s revenue requirements. After further discussions,the following amended motion was offered,seconded and duly carried: That the staff be,and is hereby,directed to draft a tentative financial plan and implementation schedule for addressing the District’s loz~g~ran~é’~financial requirements,for subsequent consideration by the Board,—utilizing the following fee and implenentation guidelines: 0 ~thi~~~ District 3 05/20/87 Implementation of a Supplemental User Fee Program 1988—89 1990—91 Class of User Basis of Charge Annual Rate Annual Rate Single—Family Charge per Dwellings/Condaniniums Dwelling Unit $24.00 $30.00 Revisions to Existing Connection Fee Program Basis of Charge 1987—88 1989—90 Sing1e4~4ulti-Family Charge per Dwelling Units Dwelling Unit $1,000.00 $1,500.00 Carinercial/Industrial Charge per Governmental/Other 1,000 sq.ft.$300.00 $500.00 FURTHER ~)VED:That staff be,and is hereby,granted discretion to n~dify the guideline fee anounts and proposed implementation dates in drafting said long—range financial plan for consideration by the Board. Approving Fktergency Repairs to Following a report by the Director of Miller-Holder Trunk Sewer,La Habra Engineering it was noved,seconded and Purchase Section,Lines “E”&“WI duly carried: (No.3—32R That the Staff Report dated May 20, 1987,relative to the failure of the Miller—Holder Trunk Sewer,La Habra Purchase Section,Lines “E”&“WI’,be,and is hereby,received and ordered filed;and, FURTHER MDVED:That the staff be,and is hereby,authorized to procure necessary materials,supplies and services for flt~rgency Repairs to Miller-Holder Trunk Sewer,La Habra Purchase Section,Lines “E”&“WI’(Contract No.3-32R)for a total aiTount not to exceed $100,000.00. Adiournnent r4~ved,seconded and duly carried: That this meeting of the Board of Directors of County Sanitation District No.3 be adjourned.The Chairman then declared the meeting so adjourned at 9:07 p.m., May 20,1987. Secretary,of Directors County Sanitation District No.3 of Orange County,California —5— . . . STATE OF CALIFORNIA) SS. COUNTY OF ORANGE Pursuant to California Government Code Section 54954.2, I hereby certify that the Agenda for the Adjourned Regular Board Meeting of District No.3 held on ______________,1987 was duly posted for public inspection at the main lobby of the District’s offices on ~~.4 ,1987. IN WITNESS WHEREOF,I have hereunto set my hand this I4~I~~ day of _______________,1987. ~ Rita J.Brown,Secre ary of the Board of Directors of County Sanitation District No.. of Orange County,California