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02/22/1995 - Packet INTERGOVERNMENTAL WATER BOARD MEETING Serving Tigard, King City, Durham and Unincorporated Area THE INTERGOVERNMENTAL WATER BOARD MEETINGSCHEDULED FOR WEDNESDAY, FEBRUARY 15, 1995 HAS BEEN CANCELED THIS MEETING HAS BEEN RESCHEDULED FOR WEDNESDAY FEBRUARY 22, 1995 AT 5:30 P.M. Tigard Water Department Building 8777 SW Burnham Street ..... Tigard, Oregon INTERGOVERNMENTAL WATER BOARD MEETING Serving Tigard, King City, Durham and Unincorporated Area THE REGULARLY SCHEDULED MEETING OF THE INTERGOVERNMENTAL WATER BOARD HAS BEEN CHANGED TO WEDNESDAY FEBRUARY 15, 1995 @ 5:30 P.M. Tigard Water Department Building 8777 SW Burnham Street Tigard, Oregon INTERGOVERNMENTAL WATER BOARD MEETING Serving Tigard, King City, Durham and Unincorporated Area AGENDA Wednesday, February 22, 1995 5:30 p.m. 1. Call to Order 2. Roll Call and Introductions 3. Approve January 11, 1995 Meeting Minutes 4. a. Rate Analysis - Request for Proposal b. Variance of hardship 5. Director's Report - Ed Wegner a. Status Report on Rules, Rates & Regulations Update b. Interim Water Supply - TVWD C. Long Term Water Supply - Lake Oswego & Willamette Project 6. Non Agenda Items 7. Adjournment INTERGOVERNMENTAL WATER BOARD MEETING MINUTES January 11, 1995 BOARD MEMBERS PRESENT: Chair Manning, Paul Hunt, Bill Scheiderich, George Morgan STAFF PRESENT: Ed Wegner, Randy Volk, Mike Miller, Kathy Kaatz VISITORS PRESENT: Jack Polans 1. Call to Order The meeting of the Intergovernmental Water Board was called to order at 5 : 35 p.m. 2 . Visitors Mr. Jack Polans conveyed his concern to the Board of the fact that the public is not aware of what is going on with water issues. Mr. Polans questioned Mr. Scheiderich in regards to the word "conditions" in the negotiations on water issues . Mr. Scheiderich stated that he is not acting in a legal capacity on this Board. Mr. Polans questioned having this issue tabled for later discussion. Chair Manning stated that negotiations are being held and that it would impossible to negotiate in a public environment and that any plan will be brought back before the IWB and the City Council . Mr. Morgan stated that there are four agencies that comprise the IWB and according to the IGA they are responsible to vote on long term water contract. Each of these public agencies will hold public meetings to discuss this long term water agreement. Through the IGA, the City of Tigard has been delegated to provide the primary responsibility of negotiating the contract for long term water. Each agency will be kept informed of these negotiations . 3 . Approval of Minutes The minutes of the December 14, 1994 meeting were approved as written. A Motion was made by Mr. Morgan and seconded by Mr. Hunt . 4 . a. Interim Water Supply Mr. Wegner distributed in the Board' s packet, a memo from Mike Miller and Chris Uber which he highlighted. He stated that it is anticipated that we will have ability to purchase between four and five million gallons per day from Tualatin Valley by the first part of June. Mr. Wegner stated that he has authorized, with the approval of the City Administrator, a hydraulic analysis that will not exceed $5, 000 .00 . This will allow us to find at three various locations, the amount of flows each location will have. This should be completed within two. weeks and we will be able to see where the interties will be which will help determine the amounts of the CIP expenditure. By the 27th. of this month, hope to have some draft language of the IGA with Tualatin Valley Water District. The anticipated cost will be 10-15% more than the cost of water is at Tualatin Valley Water District. Mr. Hunt questioned how this cost compares to what we are currently paying to Lake Oswego? Mr. Wegner stated that it would be comparable (within a few cents) of our current costs . Mr. Wegner stated that as the memo indicated, the Baylor Street reservoir site would be the primary location for the first intertie with TVWD and be online by the fifteenth of March. Mr. Wegner stated that the interim supply as discussed last month, the City of Lake Oswego will be sending a letter extending the interim supply. At this time, we have been assured verbally that this will be the case, but have not received written documentation at this time. 4. b. Adoption of Bylaws Article III - Members Chair Manning stated that this Article currently states that "members of the board will be appointed by their respective governing bodies ash follows, " but, according to the IGA, it states that this needs to be elected officials. Ms . Manning stated that this should be changed to reflect that all members appointed will be elected officials with the exception of the At Large member. Mr. Hunt moved that this be incorporated into the Bylaws and was seconded by Mr. Morgan. A voice vote was taken and passed unanimously. 4. C. Meeting Date for February The Board Members discussed the regular scheduled meeting being the 8th. of February. Since there were conflicts with Board Members for that particular date, it was decided that the meeting be scheduled to February 15, 1995 . S. Director' s Report Mr. Wegner stated that on December 23 , 1994 , Mayor Schwartz and the City Manager meet with the Mayor and City Manager of Lake Oswego and discussed a revised contract . These concerns were put in writing and presented to them. The City of Tigard did receive communication from the City of Lake Oswego late afternoon on December 10, 1994 . After a brief analyzing of, this communication, the City of Lake Oswego is willing to look at the issue of dedication of water rights, although allocation of water continues to be a problem. The City of Lake Oswegc Intergovernmental Water Board Meeting, 1-11-95 Page 2 ftov- stated that these issues need to be resolved before going onto the second tier of questions that the City of Tigard has. Mr. Wegner stated that the City of Tigard has opened up another option in meeting with three other cities (Tigard, Tualatin, Wilsonville and Sherwood) within the area to discuss the Willamette River supply. Murray Smith has turned in a preliminary report on the ten million gallon a day reservoir site. We are currently doing some testing with the pump manufacturer, with the possibility of taking on an additional three million gallons of water from that site without jeopardizing hurting the hydraulics. There is another proposal for the amount of $19 , 000 . 00 which would outline other options in order to pick up an additional 1 . 5 mgd. We are holding off on this option at this time, but are talking with the pump manufacturer and scheduling the testing to coincide with cleaning. Mr. Wegner stated that for the past two months he has promised to have a CIP, hopefully next month will have the three major components of the Tualatin Valley interties with costs attached. All four of the agencies have passed a resolution or a letter from respective councils moving the deadline to November 1 to submit a CIP. Mr. Wegner stated at this date, we have not lived up to the letter of the IGA and questioned whether the Board wanted to make a motion to extend this time frame? Mr. Morgan stated he felt that the Board should formally acknowledge the importance of the provisions of the IGA. Mr. Morgan suggested that we ask the City of Tigard to formally advise us of the date to which the Capital Improvement Program can be extended. Mr. Morgan also stated that the calendar that was provided by Mr. Wegner is a very demanding calendar to which the Board has limited control . Mr. Morgan stated that the Board will also need to be giving some attention to the Rules, Rates and Regulations . Mr. Morgan stated that he felt that a formalization of the Capital Improvement Program is a prerequisite to considering the budget or any rate discussion, or conditions of service. Mr. Wegner stated that he would send a formal letter requesting an extension on the Capital Improvement Program until June of 1996 which should allow us to time to get through the interim supply problems. Commissioner Scheiderich questioned whether the putting off of the Capital Improvement Plan would drive a re-evaluation of System Development Charges, one of the means of financing improvements in addition to rates. Mr. Scheiderich questioned if there was thought given to near future revenue bond sale? Mr. Wegner stated that we are going to the Tigard City council on January 24, 1995 asking for approval for an RFP to hire a financial consultant to do a cost of service, rate study and review the SDC charges . Mr. Wegner stated that they have already spoken to a few consultants in regards to our lack of a definite figure for our Capital Improvement Program. These consultants have stated that they will be Intergovernmental Water Board Meeting, 1-11-95 Page 3 1 i able with the information provided produce an estimate. Mr. Wegner stated that by June we will know what we will need to purchase over the next 5-10 year period of time. Chair Manning questioned whether this study was budgeted and what the cost would be? Mr. Wegner stated that it was not, but will need to come out of contingencies and would be approximately $20, 000 . 00 to do a complete study of rates, cost of service and SDC charges review. Commissioner Manning questioned if they would be doing a comparison between what the SDC charges are in relation to capital improvement needs? Mr. Wegner stated that was correct . Mr. Wegner stated that this study will tie in two scenarios , one being the Lake Oswego Plan (cost of service, projection of rates) and one with Willamette River project. Mr. Morgan questioned whether there were any preliminary projections on rate change in fiscal year 1995/96? Mr. Wegner stated that rates would not be raised within the scope of preparing this budget. Inclusive in the RFP will be the requirement that the consultant will make a presentation to four entities and will be advertised and come back to the IWB for a final report and then make a second presentation to the City Council . Hopefully this will be done by July 1. Mr. Wegner stated that this study needs to be done so we will be able to answer questions . Commissioner Morgan stated that he felt that all rates and conditions of service need to originate with the IWB. With the schedule the IWB haste and the number of variables that are involved, the compression of time is bothersome. Mr. Wegner discussed one of the advantages of the Tigard Water District with the City is the fact that the City' s Finance Department will work on the footwork of this project and allow the Water division to continue work on the interim supply. Mr. Wegner stated that he hopes to have the consultant appointed by the end of February. Commissioner Hunt questioned by the time the consultant is appointed, would we have a feel for whether we will head toward Lake Oswego? Mr. Wegner stated that at the onset of the study we will be able to use the same figure, but by the end of the study we will know what direction we will be headed in. Mr. Polans questioned whether the IWB would be able to get a 40-. interest bond rate for twenty-five year period? Chair Manning stated that we did not have the expertise to know the answer to that question, but hopefully this preliminary study will answer those questions . Mr. Wegner stated that he had provided the Board with a copy of a memo from himself to Bill Monahan in which the Maintenance Services Department provided goals for the next fiscal year. Mr. Wegner Intergovernmental Water Board Meeting, 1-11-95 Page 4 who-1-- highlighted the goals that deal directly with water issues . He also provided a newsletter from Bull Run which describes the history of Bull Run water for 100 years. Mr. Wegner stated that at the last meeting of the IWB, the Board had requested a six month update on the budget. Mr. Wegner stated that he had received those today but had not had time to review those . He will provide those at the next meeting. 6 . Non Agenda Items There were none discussed. The Board discussed items for the next agenda and concluded that they would include the regular items as well as a discussion of the six month budget. 7 . Adjournment The meeting adjourned at 6 : 15 p.m. kathy\iwb\iwb 1-11.mtg Intergovernmental Water Board Meeting, 1-11-95 Page 5 MEMORANDUM CITY OF TIGARD, OREGON TO: Intergovernmental Water Board FROM: City Staff DATE: February 8, 1995 SUBJECT: Proposal for Water Rate Study The City staff requests the Board recommend to the City Council that a consultant be retained to perform a comprehensive water rate study . The study would focus on revenue requirements, cost of service and alternate water rate structures as follows: 1. Revenue Requirements. An analysis of the sources and applications of funds would provide a measure of the relative revenues and expenses associated with the water operation. The analysis will build on historical data and project optional adjustments in future revenue levels required to meet water operation expenditures over a specified period of time., e.g., 5 year financial planning projection. 2. Cost of Service. The cost of service components to be analyzed would include costs which vary directly with the total quantity of water used, costs associated with meeting peak demands in excess of the average rate of usage and costs which vary in proportion to the number of customers connected to the system. The study will separate these costs by capacity, commodity, customer class, revenue and customer cost components to aid in the design of a water rate structure that would equitably recover the costs incurred. 3. Alternate Water Rate Structures. The current rate structure consists of a fined charge, a minimum charge which does not vary with water consumption, and a variable charge, the $1.32 per 100 cubic feet consumed. Choices about the combination of the various types of fixed and variable rate designs would be evaluated in the context of tradeoffs among policy goals, cost of service standards and customer acceptance. The rates set become the customer's signal of what their consumption is actually costing the City to provide the service. Evaluating and understanding the alternate rate designs available is very important in educating the user in understanding the changes made. Murray South Usociates,Inc. hioneers/Planners 121 S.W.Salmon,Suite 1020 Portland,Oregon 97,204 PHONE 503-225-9010 FAX 503.225-9022 ------------ 94-0310.407 February 22, 1995 Mr. Ed Wegner Maintenance Services Director City of Tigard 13125 SW Hall Blvd. Tigard, OR 97223 Re: Application to State of Oregon Water Resources Department for Water Right on Willamette River at Wilsonville Dear Ed: Enclosed is the completed application for a surface water right on the Willamette River at Wilsonville. We have completed this work in accordance with your direction at our meeting on February 9, 1995. The application includes several items which we would like to bring to your attention: 1. The point of diversion on the Willamette River will be at Wilsonville west of I-5 on the north bank of the river. We have described the diversion point at the same point as that described in the existing rights of the Tualatin Valley Water District. 2. Land use information forms will need to be submitted to the following: Washington and Clackamas Counties, Cities of Wilsonville, Tualatin, Tigard, Durham and King City. We will obtain a receipt for the information form from each of these entities after approval of the application by the Council. The receipts will be then be forwarded with the application to OWRD. Each entity has 30 days within which to respond and forward the land use information form to the OWRD. 3. We have developed the estimated ultimate water demands based upon the ultimate service area (9,732 acres) shown on the enclosed service area map, the assumption of 6.5 persons per acre ultimate population density, and the assumption of 400 gallons per capita per day maximum daily demand for that population. These assumptions thereby result in an ultimate maximum daily water demand of 40 cubic feet per second or 25.9 million gallons per day. This methodology to develop ultimate maximum daily demands was used because ultimate demands have not been identified in the City's current water system master plan update which developed year 2020 demands or the Phase 2 regional study which is developing year 2050 demands. Mr. Ed Wegner February 22, 1995 Page 2 Please review this information at your earliest convenience and if you have any questions or desire any changes to the application or supporting documents, please call. Upon Council approval, please have the application signed by the appropriate City official and return the original documents to us. We will then obtain the land use form receipts and file the application with the State on your behalf. At the time of filing, a $200.00 check payable to the Oregon Water Resources Department will be required. We appreciate the opportunity to assist you with this work and please call if you have any questions. Sincerely, MURRAY, SMITH & ASSOCIATES, INC. Philp H. Smith, P.E. Executive Vice President PHS:cyh Enclosures VISITORS PLEASE REGISTER Date: Z /Z 2 Meeting: IWEA6 , 0oc t;iz ff-C^tt Name (please print) Do you wish to speak? ayes or no) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.