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HomeMy WebLinkAbout1998-11-16 WUCFD MINUTESDISTRICT BOARD OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY) CITY OF APACHE JUNCTION,ARIZONA REGULAR MEETING NOVEMBER 16,1998 The regular meeting of the District Board of the Water Utilities Community Facilities District (Apache Junction Water Company),City of Apache Junction, Arizona,was held on November 16,1998,at the Apache Junction City Council Chambers pursuant to the notice required by law. CALL TO ORDER Chairperson Coleman called the meeting to order at 6:03 p.m. ROLL CALL Board Members Present:Chairperson Douglas Coleman Mr.R.E.Eck Mr.Joe Durbala Ms.Carol Urich Mr.John Insalaco Mr.Rick Dietz Staff Present: Others Present: (Vice Chairperson Anne Surra was absent.) Curtis Shook,District Manager George Hoffman,Assistant District Manager Keith Lewis,District Finance Manager Kathleen Connelly,District Clerk Bill Farrell,District Counsel Doug Dobson,District Operations Manager John White,District Accountant APPROVAL OF MINUTES OF JULY 20,1998 )Mr.Dietz MOVED TO ACCEPT THE MINUTES OF OCTOBER 5,1998. Mr.Durbala SECONDED THE MOTION. VOTE:Unanimous. The motion carried. DISCUSSION AND RATIFICATION OR CLARIFICATION OR READOPTION OF RESOLUTION Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 1 of 7 NO.1998-002 AND RESOLUTION NO.1998-003 ) )District Counsel Bill Farrell briefed the board on the item.The reason for the discussion is that there was some confusion at the last meeting regarding the intent of Resolution No.1998- 002 and Resolution No.1998-003.Staff is not sure the record adequately reflects what the board wished.The Central Arizona Homebuilders Association believes this is a development fee.Comparisons were offered from other communities that operate their own municipal water utility which have a water rate and a development fee.The impression could have been given that the City of Apache Junction was adopting a new development fee.The water district has no authority to issue building permits or grant rezoning of property,and therefore a development fee is not within the board's power.There had been discussion on whether a public hearing was necessary for these resolutions,and i t is his determination that a public hearing is not required,as they are similar to a regulated utility on this board,not a city council.Through that process,they would be required to file a new tariff at the Arizona Corporation Commission,get a staff report,appear once before the Commission and have the tariff approved,denied or modified.Resolution No.1998-002 is the new water rates,however,the rates for existing customers stay the same.The rate for meters has changed and notice was given to current builders and landowners at the meeting who were in process to allow them to finish their project without raising their prices.The effective date was determined to be December 1,1998. Resolution No.1998-003 that was adopted is a set of rules and regulations to clarify the policies and have them in writing.The rate schedule was attached to the latter resolution when it should not have been.He requested the board to ratify that the rate adjustment is a rate adjustment only and not a development fee.It is not contingent on a building permit and it is collected for the cost of the meter purchased plus the installation fee.The new rate charge for meters goes into effect on December 1,1998,as written in Resolution No.1998-002.The second thing that needs to be ratified is that the rules and regulations contained in Resolution No.1998-003 were to have become effective immediately.He repeated that in his legal opinion this is not a development fee nor the type of rate for which an advertised public hearing is required. Mr. Eck asked if a new 5/8" by 3/4" new home service line would run $1,261 for the new rate. District Counsel Bill Farrell stated that would be so as of December 1,1998. Mr. Eck asked if that would be a rate, not a fee. District Counsel Bill Farrell stated that was correct.This is a rate schedule,though one could call it a fee if they wished. Mr. Eck asked if this was basically for capital facilities for the future. Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 2 of 7 District Counsel Bill Farrell stated a portion of that rate paid would be reinvested into the expansion programs previously discussed. Mr. Eck asked if it could be called a capital fee. District Counsel Bill Farrell stated they could make some safeguards to make sure that a portion of it is never used for operating revenues,and that the portion is used for capital facilities. Mr.Eck stated he was primarily interested in not being able to call this a development fee. District Counsel Bill Farrell assured him that it is not a development fee.It is just the current rate for the meter, and the water consumption rate has not changed at all. with the wording. Mr. Eck stated he was having a problem District Counsel Bill Farrell commented he did not believe he was alone.The wording has not been changed since it was acquired from Consolidated. District Manager Curtis Shook stated the rate structure had to be changed in anticipation of future capacity and operational needs. District Counsel Bill Farrell agreed. The end use would be much like a municipality and a development fee, but it would be identical to a tariff being charged by Arizona Water Company. Ms.Urich commented they may want to have suggested motions in their packets to avoid any confusion in the future. District Counsel Bill Farrell stated he had discussed that with the District Clerk.They normally try to keep these agendas shorter,but they will institute some procedures that will get them to a format they are more familiar with while still leaving enough time for staff to give them adequate staff reports.They do not foresee this kind of pressure in the future. Mr.Dietz asked if it would be a problem in the October 5th meeting minutes where the district manager talked about a developmental fee and having growth pay for the water resources and the things needed in the future.He was under the assumption that it was a developmental fee.The new owners would be paying for the new tank, new pump and water reclamation center.I t appears they are trying to clean it up. Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 3 of 7 District Counsel Bill Farrell stated if litigation ensues,claiming that the district has violated §9-463.05 which allows cities and towns to enact development fees,they would certainly use the ammunition in his,the district manager's and the district operating manager's memos.These memos even called it a development fee.He commented they would have to admit in court that they had called it a development fee, but they would then be able to say that it had been reratified, with the attorney's opinion, and all evidence would show that the district is not a city or a town.Permits are not issued,zoning is not controlled by the district,and they are a regulated utility company.The rates were adopted no different than any other regulated utility company. Mr.Dietz asked if they would have to justify the difference in the rates. District Counsel Bill Farrell stated the justification provided when segregrated and explained clearly shows the need for the capital improvements.It is a way to protect all of the current and future rate payers from bearing the cost of new development. Mr.Dietz asked if they would be able to say that this is a development fee with just another name.He realizes that this is justified. District Counsel Bill Farrell commented the plaintiffs will say that,but he does not believe a court will look at it that way as the district does not have the authority to issue building permits, to rezone property or to adopt a development fee.Those are all critical elements of a development fee. Mr. Eck asked if a public hearing would have to be done if the city owned the water district. District Counsel Bill Farrell stated that was correct.If at some time in the future the voters allow the city to go into the utility business,the district would be dissolved and taken over by the city.When similar increases were proposed,then the safer course would be to hire a consultant,advertise a development fee and put i t in as a development fee. Chairperson Coleman closed the discussion and asked if they were looking for a motion to ratify the adoption. District Counsel Bill Farrell stated if they are comfortable that Resolution No.1998-003 did go into effect last month and that it is their intention that Resolution No.1998-002 not go into effect until December 1,1998,than a motion to ratify both would be appreciated and would clean the record for the district clerk and himself. Mr.Eck asked if Resolution No.1998- Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 4 of 7 003 was already in effect. District Clerk Kathleen Connel 1 y stated they would just be confirming the effective date. District Counsel Bill Farrell stated they are seeking clarification that Resolution No.1998-003 went into effect immediately and not on December 1,1998. Mr. Eck MOVED THAT RESOLUTION NO. 1998- 002 BE RATIFIED AND ADOPTED AS OF DECEMBER 1,1998; AND THAT RESOLUTION NO.1998- 003 BE IMMEDIATELY EFFECTIVE AS OF OCTOBER 5,1998. Mr.Dietz SECONDED THE MOTION. VOTE:Unanimous. The motion carried. DISTRICT MANAGER REPORT District Manager Curtis Shook commented on a memo regarding the water bond and the different projects being undertaken under that bond.The water bond was a $6.75 million bond and the projects are underway.Repayment of the initial debt has been completed,a 1,000,000 gallon storage tank at 16th Avenue has been completed,Well No. 5 has been rehabilitated, two years of recharge credits have been purchased,the 1.000,000 gallon storage tank at Baseline is under construction,and they are in the process of going out to bid for a generating system and for a SCADA system. District Operating Manager Doug Dobson commented the SCADA system is a monitoring sytem for water pressures,water use and problems within the system.It will pinpoint problem areas.In addition,i t has an automatic reading system and handheld readers so they can insert the information into the computer and do billings automatically. District Manager Curtis Shook added they are also going through different line extensions and upgrades throughout the water system, both as needed and scheduled upgrades.In addition,they are attempting to secure additional water supplies by getting permission from the state to drill a new well in the area of Tomahawk and Elliott.They have also asked the Bureau of Reclamation to purchase approximately 6 acres of land near the Central Arizona Project Canal as a future site of the treatment plant.They are approximately 3-5 years away from when they believe the district will need additional water supplies. Mr.Durbala asked if there was any more information on opening a filtration plant with Mesa. District Clerk Kathleen Connelly reminded him that the issue was not on the agenda. Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 5 of 7 District Counsel Bill Farrell commented they would have a report on that for the next meeting. DISTRICT TREASURER REPORT District Treasurer Keith Lewis stated that future financial reports should be ready around the 10th of the month. Mr.Dietz asked why so much money had been budgeted into operating expenditures than had been spent in the budget year to date. District Treasurer Keith Lewis stated the budget year to date is broken up into a 12 month period based on the budget.They determine that they have the possibility of spending that each month,and the year to date is what the 4 months have entailed.It may not be spent all at one time,it is just broken up that way. District Manager Curtis Shook asked if the new storage plan would come under that item. District Measurer Keith Lewis stated it would,and it will soon pick up. DISTRICT COUNSEL REPORT None. ADJOURNMENT )Chairperson Coleman adjourned the meeting at 6:31 p.m. ACCEPTED THIS 14TH DAY OF DECEMBER ,1998,BY THE CHAIRPERSON AND DISTRICT BOARD OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY),CITY OF APACHE JUNCTION,ARIZONA. SIGNED AND ATTESTED TO THIS 15TH DAY OF DECEMBER ,1998. ATTEST: Kathleen Connelly District Clerk Douglas CoOleman Chairperson Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 6 of 7 WATER UTILITIES COMMUNITY FACILITIES DISTRICT MINUTES CERTIFICATION I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the regular meeting of the Water Utilities Community Facilities District of the City of Apache Junction,Arizona,held on the 16th day of November,1998.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 19th day of November,1998. Kahleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of November 16,1998 Page 7 of 7