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HomeMy WebLinkAbout07 26 2017 CMCITY OF CHUB13UCK SPECIAL COUNCIL MEETING MINUTES JULY 26TH 2017 — 4:00PM CALL TO ORDER: Mayor England COUNCIL MEMBERS PRESENT: Mayor Kevin England, Ryan Lewis, Melanie Evans -Phone, Annette Baumeister, Josh Ellis, and City Attorney Tom Holmes STAFF MEMBERS PRESENT Public Works Director Rodney Burch, Bridger Morrison, Devin Hillam and Deputy CIerk Joey Bowers GENERAL BUSINESS: 1) NWSI Sewer capacity Public Works Director Rodney Burch presented the potential risk and benefit with providing sewer to develop the east side of 1-15 (see attached). Mr. Burch stated that City Engineer Bridger Morrison studied flow for every pipe and the different sizes from. Hiline Rd to the Pocatello treatment center for this analysis. Mr. Burch wanted the Council to know that the City will not lose capacity for existing and future citizens of the City, the City is not going to give up its capacity to grow. The Millennial developer will install and pay for the sewer line from I-15 to Hiline Rd. Mr. Burch felt like when we put a cap we limit income into the City and development capabilities. The County fees are designed to promote City development. Council wanted to make sure that the hardworking citizens of Chubbuck that is currently paying for this system are being protected. Council also wanted to make sure that if both the east side and west side of the freeway erupted in growth that the City of Chubbuck sewer system wouldn't be in danger. They also felt like that the City was not discouraging growth in the County, but protecting the City's future assets. 2) Northgate I.C. Service Agreements Public Works Director Rodney Burch wanted Council to be aware that they will bring bids and contracts before the Council for approval. City Staff is having the Mayor approve the day to day decisions that fit within in the Councils approved budget. Council just wants to make sure that the City is not spending a lot of budgeted money until all the contracts have been signed with everyone involved with the interchange. Council also wanted to make sure that Staff keeps the Council informed on progress. ADJOURN: MAYOR KEVIN ENGLAND RICH MORGAN -C Y CLERK KEVIN E NDAYOR zig�� Public Works Department CHUBBUCK POBox 5604 — 5160 Yellowstone Avenue, Chubbuck, ID 83202 208.237.2430 —Fax 208.237.2409 www.GtyofChubbuck.us I a R H 0 Memo To: Mayor / City Council From: Rodney Burch, Public Works Director Date: July, 24, 2017 Re: NWSI Siphon Road Sewer Capacity Dear Mayor/ Council Members, The intent of this summary is to represent the potential risk and benefit associated with providing sewer to development east of 1-15. This analysis is based on system criteria establish by the JUB sewer capacity study. in addition, the information is based on the following system operational criteria: 1) It assumes that the planned area for the Siphon Phase of the NWSI project is 100% built out, 2) It assumes EDU density based on future land use designation per the original JUB capacity study. 3) It assumes the connection fee to be a constant $5,490.00 per EDU. 4) It assumes construction costs based on 2017 pricing. JUB Capacity Analysis — Existing System: In 2008 JUB Engineers completed the engineering report for the Siphon Phase of the NWSI service area. This study relied upon actual flow / use data collected on the existing City of Chubbuck system to establish actual EDU flow data. Additionally, the study relied upon the Future Land Use designation map to determine planned EDU density for the Siphon Phase service area. The results of this study indicate a minimum density of 2.9 EDU per acre. The service area of the Siphon Phase is +/-1,845 acres with projected flows equivalent to +/-8,400 total EDU connections (at the west end of the Siphon Road line). (see exhibit #1). It is critical to understand that the number of allowable connections increase as pipe sizes increase moving towards the treatment plant. There are only 2500 planned EDU available at Hiline / Siphon intersection. Current System Usage: Currently there are +/-425 EDUs connected to the Siphon Phase (including Paradise Acres subdivision and Ellis lift station) which equates to 5% of capacity. The sewer lines in Hiline Road have 1 connection. The current excess capacity in the Siphon Phase is +/- 7,975 EDU. Potential Growth: Projected growth rates are speculative at best. For this analysis we have assumed growth west of Yellowstone highway to remain consistent with the recent past. Growth between Yellowstone and 1-15 may occur at an increased rate. For comparison, the City of Chubbuck has issued the following permits annually: 2014 70 EDU permits 2015 73 EDU permits 2016 64 EDU permits 2017 47 EDU permits to date As previously stated, the Siphon Phase of the NWSI includes +/- 1,845 acres or +/- 8,400 EDU. Most of this area does not currently lie adjacent to Chubbuck City Limits. This results in the majority of this property developing as Bannock County subdivisions. As such, the County subdivision and land use policies and the application of an appropriate EDU -based connection fee will help slow the capacity demand on the Siphon Phase. A slow growth rate in the County provides flexibility in providing additional capacity east of 1-15. There are currently +/- 432 acres or +/- 1,250 EDU of undeveloped property which lies between the current City limits and the Siphon Phase service area. (see exhibit #2). Effective land use planning would suggest that this area should develop and be annexed into the City prior to development in the County. Assuming current growth rates, the City of Chubbuck has greater than 10 years before needing to expand into areas served by the Siphon Phase of the NWSI west of Yellowstone Ave. We believe the Siphon Phase of the NWSI will be at less than 50% capacity in the next 10 years. The excess capacity available based on consistent growth is our safety factor. PO Box 5604 —5160 Yekowstone Avenue, Chubbuck, ID 83202 Jg�-- 208.237.2430 — Fax 208.237.2409 CHUBBUEK www.CityofChubbuck.us IaaH© Excess Capacity Although the NWSI system was built with a defined service area that does not include area east of I-15, a detailed analysis was performed to determine if any excess capacity is available in the system, beyond what we expect to serve within our service area. Each pipe segment from Hiline Road to the treatment plant was evaluated based on the constructed size and slope to determine that pipe segment's capacity and the corresponding planned flow from Chubbuck's service area assuming 100% built -out conditions. Any difference between the pipe's capacity and the planned flows was treated as excess capacity that could potentially be provided to the area east of 1-15 without jeopardizing our ability to serve the area west of 1-15. The excess capacity varies for each pipe segment and at different locations along the sewer line. This analysis allows us to better understand the impact adding incremental amounts of EDU's has on our existing system and in defining the magnitude of improvements that might be needed to recover any reduced capacity. Financial Risk / Benefit: The objective of the financial risk / benefit analysis is to ensure that the City of Chubbuck has sufficient financial reserves that have been paid by the developer. At any point in time these reserves could be used to either construct the new Tyhee Phase or upgrade the existing Siphon Phase as needed. To accomplish this, we have analyzed the cost of impacts created at 500 EDU increments of EDUs provided to development east of 1-15. If the cost to construct / upgrade is less than our cash reserves, our risk has been mitigated. Based on a connection fee of $5,490.00, the analysis is represented below: Number of Connections Collected $$$ Accumulated Reserves Siphon Upgrade Cost 500 $ 2,745,000.00 $ 2,745,000.00 $ - 500 $ 2,745,000.00 $ 4,585,000.00 $ 905,000.00 500 $ 2,745,000.00 $ 6,285,000.00 $ 1,045,000.00 500 $ 2,745,000.00 $ 8,880,000.00 $ 150,000.00 500 $ 2,745,000.00 $ 11,215,000.00 $ 410,000,00 $ 2,510,000.00 PO Box 5604 —5160 Yeliowstone Avenue, Chubhuck, 1D 83202 la�ot_\ 208.237.2430 — Fax 208.237.2409 CHUBOUCK www.CityofChubbuck.us I a 0 H 0 *** Example....... To start, we lease 500 EDU and collect $2,745,000.00 in connection fees. There is no upgrade cost for the first 500 EDU resulting in a cash reserve of $2,745,000.00. The next 500 EDU collects an additional $2,745,000.00 but has an upgrade cost of $905,000.00 resulting in a cash reserve balance of $4,585,000.00. At no time does the cost to upgrade exceed the cash reserves. When the accumulated reserves are sufficient to build the Tyhee Phase, we would move forward with that construction. It is critical to understand that these impacts are based on the existing Siphon Phase being at 100% of plan capacity. Anything less than 100% will allow excess capacity and reduce the need to upgrade the Siphon Phase, thereby speeding up the funding of the Tyhee Phase. Additional Revenue: The developer will pay the City of Chubbuck a lease fee for the EDUs provided, This fee will equate to $60,000 per year for each 500 EDU increments. Below is a summary of lease revenue: Number of Connections Monthly Revenue Annual Revenue 500 $ 5,000.00 $ 60,000.00 1000 $ 10,000.00 $ 120,000.00 1500 $ 15,000.00 $ 180,000.00 2000 $ 20,000.00 $ 240,000.00 2500 $ 25,000.00 $ 300,000.00 This revenue can be used as supplementary income to the general fund. /—b`-4�reA - CHUBBUCK 1 0 PD Box 5604 — 5160 Yellowstone Avenue, Chubbuck, ID 83202 208.237.2430 — Fax 208.237.2409 www.CityofChubbuck.us Pocatello and Bannock County: The City of Pocatello will collect voluntary contractual payments from the Developer and transmit them to the City of Chubbuck. Additionally, Pocatello will reimburse Chubbuck approximately $0,90 per 1000 gallons of sewer generated east of 1-15 that flows through our system between 1-15 and the treatment plant. This revenue is the cost of system O&M and depreciation. Bannock County will charge the connection fee of $5,490.00 on an EDU per acre basis not per building permit. The net effect is a building permit on 1 acre will pay $5,490 x 2.9 EDU = $15,921.00 to connect to the NWSI. Summary: In summary, the proposed lease agreement provides a mechanism to protect the City of Chubbuck against any damage caused by underperformance by the development east of 1-15. If their growth stops, we will have sufficient reserves to replace the lost capacity. If the development east of 1-15 moves forward as planned, the City of Chubbuck will have collected sufficient fees to fund the Tyhee Phase of the NWSI, The impact to Pocatello will be limited to administrative duties in collection and reimbursement of fees to the City of Chubbuck. The impact to Bannock County will be limited to administrative duties in collection and reimbursement of fees to the City of Chubbuck. PO Box 5604-5160 Yellowstone Avenue, Chubbuck, ID 83202 lao�t-\ 208.237.2430 — Fax 208.237.2409 CHUBBUCK www.CityofChubbuck.us IRRHR Siphon Road Service Area Exhibit #1 Siphan_Sewer_Area Chubbuck Road Service Area Exhibit #2 Exist ing_Sewe r Service_Area