Work Session Minutes of
the Town of
Subject:
Web Site: http://www.townofcary.org
Mayor
McAlister called the work session to order at
Present:
Mayor Ernie McAlister, Council Members Marla Dorrel, Michael Joyce, Jennifer
Robinson and Julie Robison
Council
Member Nels Roseland arrived at
Absent:
Mayor Pro Tem Jack Smith
Copies of
staff’s PowerPoint presentation is attached to and incorporated herein as Exhibit
A.
Town Manager Bill Coleman
stated that over the past several years the Town has worked with other
municipalities and with Wake County looking at future waste water needs for the
region. He stated that the Town’s Interbasin transfer certificate requires
that the Town have a discharge into the
Director
Kim Fisher of the Public Works and Utilities Department stated that the Western
Wake regional wastewater management facilities project encompasses the Towns of
Morrisville, Cary, Apex and
Mr.
Roseland asked if the build out is for the plant or the developmental use of
capacity. Water Resources Manager Leila Goodwin responded
that it is both.She said that there aren’t
any projects beyond the existing planning area, but in 2030 the capacity for the
planning area would be met.
Mr.
Robison asked about the formula used for the amount of return. Ms. Goodwin
responded that the formula is calculated by the amount of water the Town uses in
the Neuse
River basin
and is based on the amount of
water usage tracked for customers. The Town has to return part of that usage to
the
Mr.
Roseland asked about the net regional impact of the plant. Ms. Goodwin said that
there would be a net transfer into the
Ms. Dorrel
asked what happens if the Town does not meet the 2011 transfer certificate
deadline. Ms. Goodwin responded that state agencies would make that
determination. Mr. Fisher added that if the Town did not make a wholehearted
effort to meet the requirement and the state agencies determined that the Town
was being slothful in meeting the deadline the fine would be $10,000 per day;
however, if a series of events occurred beyond the Town’s control prohibiting
the Town from meeting the deadline a penalty probably would not be assessed. He
said that staff is making every good faith effort to meet that deadline. Ms.
Goodwin stated that staff has made it very clear to the state that the Town is
planning to meet the deadline.
Mrs.
Robison asked about events that could potentially derail or delay the project.
Ms. Goodwin stated that the biggest potential for a delay is in the
permitting process because it is unpredictable. She said that design and
construction would also have some affect, but those are more predictable than a
regulatory issue. Also, the permitting process allows for a third party to
comment on environmental issues and that has the potential to cause delays. Mr.
Fisher added that staff is working closely with the state regulatory agencies to
involve and inform environmental groups in order to help move the process along.
Mr.
Roseland asked about costs attributed to additional capacity and meeting
permitting requirements. Ms. Goodwin responded that the Town is avoiding the
extra cost of piping across the basin boundary by having a facility in the
Mrs.
Robinson asked about the cost of building a new facility in the
Mrs.
Robinson asked about costs, build out requirements, and caps for municipalities.
Ms. Goodwin stated that there is a mechanism in the service agreement to
maneuver the caps if a municipality is not using their capacity. Mr. Fisher
added that there will also be mechanisms in the joint agreement to unilaterally
expand build out. He said that the Town’s consultants have worked closely with
other municipalities on their numbers for capacities and there has been a lot of
benchmarking with current and future growth rates. Ms. Goodwin said that as part
of the permitting process each municipality has to justify their projected need.
Ms. Dorrel
asked about the basis for proportional costs. Ms. Goodwin said they are based on
combined weighted average for each of the facilities.
Director
Karen Mills from the Finance Department discussed capital needs and the budget
implications for the project.
Mr.
Roseland asked about the contributions of residential and non-residential
customers. Ms. Mills said that the rate model includes projections and
costs are spread equally across demand.
Ms. Dorrel
asked if the projected increases presented were only for this particular
project. Ms. Mills responded that there are routine increases for inflation,
continued population growth, and growth demand for business as usual.
Mayor
McAlister asked about the cost to run the system. Ms. Mill said that by 2012
payments to
Ms. Dorrel
asked if water treatment costs were included in the projections and about the
possibility of costs by 2012 having more than a $22 per month increase. Ms.
Mills said that treatment costs were included and that there would be other
costs attributable to the rate structure.
Mr.
Roseland asked about the total cost. Mr. Fisher said that phase 1 takes the Town
up to 2020 and phase 2 to 2030. Ms. Goodwin said the projected cumulative cost
is $175 million through 2030. Mr. Fisher added that of the $175 million
approximately $60 million is what it will cost to get from 2020 to 2030. He said
that the first phase costs allows for 10.5 million gallons per day total
capacity. He said that the plant is being designed to get the Town to the end of
phase one.
Mr.
Roseland asked about the possibility of zones for future payment structures,
stating that those who benefit the most should pay the most.
Mr.
Coleman responded that there are regulations prohibiting differential rates
throughout the Town. Mr. Henderson added that you can in general have different
classes of customer, i.e., residential and commercial.
Mr. Fisher
stated that staff is requesting direction from council to move forward with the
preparation of the necessary documents to hold a general obligation bond
referendum in May 2005 for the purposing of funding the project.
Mr. Joyce
asked about
Cary’s share of costs for the bond referendum. Ms. Mills
responded that the referendum would cost $60 million and
Cary’s share would be $38
million.
Mr. Joyce
asked if the Town could save money by holding the referendum in November. Public
Information Officer Susan Moran responded that November is the most expensive
time to buy media coverage. She said that staff provides information for a
comprehensive voting program so that people will understand the purpose of the
referendum and it will be more difficult and costly to get media exposure in
November. Also, Apex will present a referendum with
Mayor
McAlister asked about the revolving fund construction money. Ms. Mills said that
with the state revolving loan the Town will not have to repay principal until
the project is completed. However with the utility project the Town will be able
to structure debt with the general obligation bonds and postpone payment.
Mrs.
Robison asked about the likelihood of receiving the state revolving fund loan.
Ms. Mills said it is a couple of years away and if the money is available it
will be received over a period of several years.
Mayor
McAlister asked about savings to the Town. Ms. Mills said she did not have the
exact figure, but it is 50 percent of an interest number significantly cheaper
than what the Town normally pays.
Ms. Dorrel
asked about the implications on not moving forward with the project. Mr. Coleman
responded that the state could put limitations on the Town drawing water out of
Mayor
McAlister stated that meeting the interbasin requirement by 2011 is required to
support growth that has already occurred.
Mr.
Roseland asked about the Town meeting the permit regulations with what is
currently being transferred between the basins. Mr. Coleman responded that staff
has made that point to the state, and included it in the environmental
documentation submitted. He said that even if the discharge to the cape fear
entitlement is removed, there is a possibility that the Town would be unable to
create the amount of capacity needed for future discharging somewhere else.
Also, there is the question of whether the Town would be able to obtain a
discharge permit and the cost of treating to the level of discharge might
overwhelm the savings. He said that having the interbasin transfer requirements
lifted would not necessarily benefit the Town because of the regulatory
requirements for discharges into the
Mrs.
Robinson asked if lifting the time line would have any value or costs savings to
the Town. Ms. Goodwin replied that staff would have to look at the interim
requirements with
Mrs.
Robison asked whether staff has looked at the capacity for Cary
and about the percentage
allocated for the
Mayor
McAlister said it is important to have a solid press release when informing
citizens about the bond referendum. Ms. Moran said that state law prohibits Town
resources being used to advocate the passage of the bonds. She stated that the
Town will put out the facts about the issue on all sides.
Action:
Mrs. Robinson made a motion to direct staff to prepare the necessary documents
for a staff report to be presented at for January Council meeting for a general
obligation bond referendum. Mrs. Robison provided the seconded.
Mr.
Roseland stated that he does not agree the Town should be able to use cash for
the capital project.
Action:
Vote was called for on the motion Mr. Roseland voted “no.” All others voted
“aye.” The motion carried by majority vote.
The work
session ended at