HomeMy WebLinkAboutCommittee of the Whole Minutes 09.19.2000 MINUTES
CITY COUNCIL COMMITTEE OF THE WHOLE
SEPTEMBER 19, 2000 6:30 P.M.
COUNCIL CHAMBERS
MEMBERS PRESENT:
Lauren Van Roekel
Ken Olson
Gay Easton
Bill Staudinger
Gary Temple
Mark Mace
Daniel Dar~
Bud Johnson
OTHERS PRESENT:
V. Joe Leckie
Larry McCann
Mary Embleton
Cai Cumin
Mike Zuhoski
~mStevens
Jan Faught
Larry McCann gave a presentation regarding the WWTP and the need for a waste water rate
increase.
The waste water system includes the plant, about 31 miles of collection lines and about 540
manholes, ail of which require maintenance. The waste water system is an Enterprise Fund,
which should be self-sufficient so that totai costs of the system should be supported by the rates
collected.
The Montana Rural Water Association and the Midwest Assistance Program provided assistance
to determine the necessary rate increase.
There is a difference of $296,046 between income and expense in the 2000-2001 Budget, and
this shortfail cannot be made up without a rate increase. If profit and loss figures are totaled, an
overail loss of $648,852 exists. The 2000-2001 Budget includes an 85-cent rate increase to
balance the budget. The 85-cents balanced the budget only after removing $231,800 of
maintenance and repair monies from the budget. The present replacement and depreciation
reserves are $95,110.86. This money is set aside to fund major items that fail or to offset costs of
upgrades to the plant or system. Present system development funds total $89,713.28. These
funds are collected from individuals tapping onto the system and should be used to upgrade line
size when developers extend collection system lines. Since reserves, reserve interest, and system
development, interest have been used to baiance past budgets, the money is not available for
upgrades to the system. The present plant, which was designed for a 20-year span, is now 17
years old and an upgrade is needed. Expansion of the plant would cost an estimated $6 million.
Because of the city's new accounting system, administrative costs dropped for this fiscal year.
Debt service costs rose because of the Jet Rod truck that was purchased. Liability costs rose due
to increase insurance rates, and utility and employee costs have also increased.
The current residentiai rate for an in-city customer is $5.73/month per meter; the proposed new
rate would he $9.57/month per meter. The current outside city charge is $5.73/month per meter;
the new rate would be $9.57/month per meter. Consumption is currently charged at $1.53 per
100 cubic feet, and the new rate would be $2.56 per 100 cubic feet. Summer averaging for
residential customers would remain the same, based upon the new rate.
The average residential consumption for a single family in the city is seven units (1 unit - 100
cubic feet). Using that figure, the average bill with the old rate was $16.44. The average bill
with the new rate would be $27.49, an average increase of $11.05.
Commercial rates would be adjusted as follows: Refinery flat rate per employee would change
from $1.67 to $2.79; RV Dump charges would change from $58.08 per year to $96.99 per year;
flat rates for out-of-city users would change from $21.53 per month to $35.76 per month; KR
industrial waste charges would change from .22 cents per 1,000 gallons to .37 cents per 1,000
gallons.
System development fees would be increased $100 for new customers requesting connection to
the system.
The rate increase is based on actual revenue ($543,000) received from customers in 1999-2000.
The rate excludes revenues from system development, reserves, and interest on funds. The
2000-2001 Budget projected an 85-cent rate increase to balance the budget, but no maintenance
for the waste water system was included. The excluded funds will begin to build when interest
earned is retained and not used to balance the budget.
Larry explained four major projects. The first project is replacement of the collection line from
Railroad Street to South 4th in South First Avenue at an estimated cost of $150,000. This old
steel line does not have proper grade slope and the bottom half is rusted out.
The second project is to rebuild five manholes on Lindy Lane. The manholes were homemade
with 55-gallon drums that are rusted through and allow infiltration. The estimated cost would be
$30,000.
The third project is to r,e~lace and up-size the collection line in 8th Avenue from Main to 9th
Street. The rebuild of 8 Avenue does not include water and sewer lines. These lines need
replacement before the new road is constructed in 2003. The estimated cost for the sewer lines is
$200,000.
The fourth project is the manpower to maintain the 31 miles of collection line. The estimated
cost of $48,000 would provide an estimated 3,273 hours of manpower.
Gay Easton stated that an Enterprise Fund needs to be self-sufficient and a rate increase is
necessary. Gay thanked Larry for his presentation.
Cai Cumin distributed a brochure from Billings, Big Skry & Beyond - Vision 2050.
Development in Billings and surrounding communities is happening at a rapid pace, and Billings
is approaching a crossroads in its growth. On October 5-7, the Billings, Big Sky & Beyond
charrette will give everyone interested in the region the opportunity to explore and shape its
future by participating in this conference on regional planning. The meeting will be held at the
Radisson Northern Hotel. Cai encouraged attendance at this meeting.
Fire Chief Stevens read a letter of thanks received from Carl Zabrocki, Captain, Billings Fire
Department. Mr. Zabrocki stated that he "recently had the opportunity to work with a Laurel
VFD crew at the Ravalli Complex Fire near Sula, MT....The community of Laurel is very
fortunate to have these dedicated fire fighters representing them and protecting their lives and
property. Please extend my personal thanks to all your crews. It was a pleasure to work with
them and I look forward to working with them again."
Jim has commended the crews that were assigned to the western part of the state. Ken Olson
stated that Mr. Zabrocki only extends letters for a job well done.
Mary Embleton mentioned that several councilmen and staff would be attending the League
meeting in Missoula in October. The annual Budget Document has been completed and is ready
to be mailed. Audit comments are presently being addressed.
The meeting adjourned at 6:57 p.m.
Respectfully submitted,
Cindy Allen
City Council Secretary