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HomeMy WebLinkAbout2007-02-06 WUCFD MINUTESWATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY) CITY OF APACHE JUNCTION, ARIZONA REGULAR MEETING FEBRUARY 6; 2007 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 February 6, 2007, 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 6:00 p.m. ROLL CALL Board Members Present:Chairperson Douglas Coleman Vice Chairperson R.E. Eck, Jr.(arrived 6:10 p.m.) Staff Present: Others Present: Mr. Rick Dietz Mr. John Insalaco Mr. Joseph Severs (arrived 6:02 p.m.) Mr. Kris Sippel Mr. Dave Waldron Kathleen Connelly, District Clerk Kay Bigelow, District Counsel John White, District Finance Manager Doug Dobson, Utility Director Giao Pham, District Engineer Assistant City Manager Bryant Powell Scott Davis, Damon S. Williams Michelle Deon, Damon S. Williams DISCUSSION WITH REPRESENTATIVES OF DAMON S. WILLIAMS ASSOCIATES ON Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 1 of 15 WATER RESOURCE ASSESSMENT DRAFT REPORT )Utility Director Doug Dobson briefed the board on the item.He advised Scott Davis and Michelle Deon were there to make a presentation on the study. Mr. Scott Davis stated the contract was to assess the water resources and look at two options for treatment.The goals were to assess long term water resource strategies and develop a strategic direction.They looked at current and future demands based on previous studies and a slight update to that via the water projections put into the master plan.This is a growing service area with limited water resources.Groundwater makes up 90% of the current demand; the remaining 10% is treated Central Arizona Project water.They have been recharging the groundwater with treated wastewater.That is important as in 2025 the active management district for Phoenix will require as much to be put in as is taken out.The challenges the district faces are the water quality in regards to arsenic issues and being on the edge of an aquafir with a very shallow bedrock causing sporadic well production.A surface water challenge is a limited Central Arizona Project allocation and reused water.The present supply of water limits growth; only about 50% of the Lost Dutchman Heights Parcel A can be supplied with the current water supply. The changes required to support limited growth include changing and utilizing the entire surface water allocation and buying more groundwater recharge water.Taking the recharge credits that could be bought from the sanitation district, the current recharge credits, and the Central Arizona Water supply and treating it gives the district 5,226 acre feet available which is more than sufficient to meet the current daily needs.It does not cover more than half of Parcel A.It is anticipated by the state to be selling off parts of Parcel B in 10 to 15 years, and once developed it will bring the city up to 9,000 acre feet of supply requirements. Mr. Sippel stated that is with the current situation of having only 3 wells. Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 2 of 15 Mr. Scott Davis stated that is correct. Mr. Sippel commented the district would be growing as the city grows and that is not in this. Mr. Scott Davis stated that is correct.The shortfall is caused by only having the current supplies.As the population grows, the more wastewater is produced and the more reclaimed, reused water is available to recharge the ground.Full build out of Parcel A and B and the city will come to about 20,000 acre feet a year, estimated to occur about year 2027.He recommended starting to invest in infrastructure such as expansion of the wastewater facilities, expansion of the treatment facilities, and an aggressive water acquisition program.They need someone who will aggressively lobby for the district and will go out and find new water resources on a continuous basis in order to build up that shortfall.The land beyond Parcels A and B have not been taken into account in the future.Groundwater will become a backup water supply for the district.They may need to build wells in Lost Dutchman Heights or further south to get a better quantity of water.In 2008 the state will be sending out letters to determine how the water is used, the growth requirements, the demand, how challenges are met and their own plans for resources.In 2010 the data will be compiled and the Department of Water Resources will re -allocate 70,000 acre feet of non- Indian agricultural available.It will be the last Central Arizona Project allocation to be made in the foreseeable future. Another option for surface water is signing a lease agreement with the Gila River Indian Community and the San Carlos Indian Tribe for a 100 year assured water supply as other communities have done.Right now your citizens are using drinking water for watering their plants; they should start using reused water or go to xeriscaping. Vice Chairperson Eck asked if he was saying using reused water from the wastewater plant or not to refill the aquafir and reuse it that way.The city does Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 3 of 15 not own the sewer district.He asked if they could replenish and use that as reused water. Mr. Scott Davis stated that is correct.The district has a contract with the sanitation district to buy up to 2,162 acre feet in credit.Currently they are only producing 1,000 acre feet.They could recharge all of the water and have the balance come out of the aquafir.Another alternative is to go into a new development and have the contractors lay down reused lines and meter systems for landscape usage.Other communities have been doing this. Vice Chairperson Eck commented he has seen those purpose boxes.They would have to have an intergovernmental agreement with the sewer district. Mr. Scott Davis stated the water boards have to work with the sewer districts or they lose the renewable reused water supply source that they need to make the water resources work for them.This wastewater district has a problem with the recharge as they are sitting on a parched water table and they are having trouble recharging it.They are looking into options in their master plan on how to use this water for golf course irrigation and other irrigation systems. A joint working relationship with them would be a great way to get this done; they could form a recharge facility for a recharge and withdraw recovery area.Alternate sources of water could include relationships with other communities, such as additional intergovernmental agreements with Mesa, Arizona Water Company, Queen Creek or Queen Creek Water.It could help to create a regional surface water treatment plant. Vice Chairperson Eck commented it looked like it might be the least expensive way is to tie in with Mesa, buying into that portion of the plant. Mr. Scott Davis stated that is correct. Water Utilities Community Facilities District Meeting Minutes of February 6,2007 Page 4 of 15 Vice Chairperson Eck commented it was cheaper on the capital end and for the consumer. Mr. Scott Davis stated that is correct.It depends on if the board wants to grow.Scenario number one on utilization is to sell all the water resources to someone else, let them treat it, sell it back to the district and then put it in the water system.There is no control if their costs go up; the district's costs will go up then also. Other cities that have done this usually go back to their own water system because they cannot control the costs.This would be a no growth system for the district.Scenario two would be to sell off the water supply and develop more groundwater wells to sustain the growth within the district and possibly the remainder of Parcel A.Scenario three adds groundwater supply, surface water supply, reused water and sustainable growth to the limits of the acquired water resources.Scenario four is for industrial growth which uses all the other options and adds an expanded water reuse water system.They believe the board would be most interested in scenario three.The most important issue in it is the aggressive acquisition of surface water.They may be able to get some from lease water or Central Arizona Project, but they will also have to look at alternate sources such as a surface water treatment facility being constructed.He stated they will have to be more aggressive in their agreements with the other entities.It is important to start the activities sooner rather than later for the district to be able to grow. The Mesa interconnect booster station is an interim treatment facility; it can be that until the district builds its own facility and thereafter be used as an emergency backup for both water systems in the event of problems for either one.They also looked at the Central Arizona Project plant and the site depends on the allocation; the cost of groundwater wells with arsenic treatment which would backup the surface water supply; aquafir recovery wells; charging wells on the north side of town; expanded reuse water treatment; and the probable cost estimates for the interconnect. Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 5 of 15 Vice Chairperson Eck commented the costs are not as high as he thought they would be. He asked what kind of time frame they were looking at. Mr. Scott Davis stated it is an open-ended agreement. Assistant City Manager Bryant Powell asked if the price of the land was included. Mr. Scott Davis stated it is not.This is the cost prepared by the past consultant and he did the re -estimate in July. Assistant City Manager Bryant Powell asked if they already have the land. There was general discussion on whether the land had been purchased.It was determined it had not been. Mr. Scott Davis stated part of the problem with the interconnect is the district loses its assured water status as an assured water supplier because they had to get Mesa to sign a hundred year contract. Vice Chairperson Eck asked how Arizona Water gets away with it. Mr. Scott Davis stated they may have different agreements.He is not sure how they are doing it.If they do not have rights to that water, or are not treating the water, and they go with the interconnect and go consecutive use they would lose the assured water supply.They discussed this with the state.They would not be able to guarantee assured water to developers. District Counsel Kay Bigelow stated she had conversations with Arizona Department of Water Resources a year ago about this process.They were hesitant to Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 6 of 15 say the district could use it.as its one hundred year water supply because Mesa cannot tie up its plant for one hundred years.However, as long as there was a transition into a treatment plant they were willing to consider that as part of the assured water supply status.They have not finished lobbying them on the issue; they have just stopped trying to secure the land. Mr. Scott Davis stated the key is that it is being used as an interim treatment facility until they go forward with their own plant.They have to be able to treat the water they have available to make a hundred year water assurance.There are three options for the equipment for the land down there and its capacity.They looked at cost based on 2.6 million gallons a day, which is their current Central Arizona Project water supply; how to expand the plant; the maximum capacity of the plant which could be about 10 million gallons a day; the other two options which could be about 20 million gallons a day; the building out at the canal; pre -sedimentation basins; redundancy; membrane filtration; accessory buildings and reservoir; and sledge -handling facilities. Mr. Dietz asked if this facility would handle 10 million gallons. Mr. Scott Davis stated 2.6 million gallons as it stands; they would then have to add coagulation, filtration and sedimentation units.It also has granulated, activated carbon gack for a final filtration method. Mr. Dietz commented the 15.2 to 16.2 would be the coagulation/sedimentation for 2.6 million gallons per day. Mr. Scott Davis stated that is correct.If they take away some of the redundancy, they could get up to 5.2 million. Water Utilities Community Facilities 'District Meeting Minutes of February 6, 2007 Page 7 of 15 Mr. Dietz asked about the coagulation membrane/filtration for 11.8 to 12.9. Mr. Scott Davis stated it has redundancy built into it. Mr. Dietz commented he is not following him. Mr. Scott Davis stated there are 3 different methods of doing this.One is coagulation and sedimentation in long, concrete basins; then there is injecting chemicals directly into the pipe and using membranes to filter along with some small basins; and the xenon -type system. Mr. Dietz asked how they would increase the production'to 10 million gallons per day. Mr. Scott Davis stated in the first option 4 more units of coagulation, filtration and sedimentation basins must be added. Mr. Dietz commented they could do that with each set up. Mr. Scott Davis stated that is correct.The first set will get 10 million gallons.The other two, because they are smaller footprints, will get up to 20 million gallons. Vice Chairperson Eck asked why they would not want to go with coagulation membrane if the cost is Cheaper and more water=can be produced.. Mr. Scott Davis stated there is an issue with maintenance and operation.It is more intense; a full time operator must be there. Vice Chairperson Eck asked if the extra cost is included. Water Utilities Community Facilities District Meeting Minutes of February 6,2007 Page 8 of 15 Mr. Scott Davis stated it is incorporated. Vice Chairperson Eck commented it is actually cheaper.They do not know how many more gallons they will need when the land down south opens. Mr. Scott Davis stated the initial U.R.S. study for the state estimated 3,800 acre feet required for that supply.Adding in Parcel B's 6,000 acres, it will be another 14 thousand acre feet per year. Vice Chairperson Eck asked how much they have now. Mr. Scott Davis stated the district has 5,226 acre feet a year right now.If the plants are built they would still have the 2.6 million gallons per year unless they go out and get more water. Vice Chairperson Eck commented they have been replenishing. Mr. Scott Davis stated that is groundwater.It is not treated in the same fashion as Central Arizona Project water. Vice Chairperson Eck asked if this could only be used for groundwater or also for surface water. Mr. Scott Davis stated this is for surface water, not groundwater, treatment. Ms. Michelle Deon stated they wanted to make sure everyone realized the big difference in the previous master plan costs in a couple of things.These three facilities that have been costed out are based on the ability to be out -of -service and have complete redundancy so that they could supply water to the citizens if they were take one of the Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 9 of 15 units out of service.It was not included in the previous planning efforts.It is important to realize that the interconnect work that would allow them to bring water into the facility is sized for the full capability at build out.It is one of the items that will be increasing the capital costs as well. Vice Chairperson Eck commented that when they are saying the plant is down, the district would go to the well water and the tie in. Ms. Michelle Deon stated if one of the two trains goes out of service for any kind of malfunction, they have a dual train for the water. Vice Chairperson Eck asked what happens if the canal goes down. Ms. Michelle Deon stated if the canal goes down then they would have to use their wells or the interconnect. Vice Chairperson Eck asked if that was in the study. Mr. Scott Davis stated it is. The package treatment system is a very compressed coagulation/sedimentation/filtration equipment that puts out 1 million to 2 million gallons a day.He described how they work and how they would lay out on the property.The service area could be tripled in the next 23 years.It could be quadrupled when they go into Parcel B.It would a lot of growth for the district.If they do not want to grow, wholesale the water off, have them treat it, buy it back and sell it back to the customers. Vice Chairperson Eck commented they had been given a price of 28 cents per thousand gallons of palatable water. Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 10 of 15 Mr. Scott Davis stated they did not take into account the current contract the district has with Mesa for 1,000 gallons a day or the service charges. Vice Chairperson Eck commented staff has been concerned about having enough water pressure for an area on the south side of the freeway since they mix the water from wells on both sides of the freeway.They are looking at possibly crossing under the freeway in order to get water.His question is how soon they might have water on the south side wherein they could turn the transmission line into a distribution line and avoid the cost of creating another line. He does not even know if that is feasible. Mr. Scott Davis stated well 6 is on the south side and it still needs to be moved up north because it has arsenic.They do not have redundancy in the arsenic equipment so they have to blend.They have to have the ability to move it up there.If they build the treatment plant on the south side, they will also need to move it up there. They will need to have the transmission line going up there. Vice Chairperson Eck stated he was hoping they had increased enough on the south that they would not have to worry about it.The north will not grow much, but the south will. Mr. Scott Davis stated part of the plant cost includes a 3 million gallon reservoir plus a booster station, giving them the pressure they will need.It will take them 3 to 5 years to build the plant, dependant on when they get it started.If they add some more wells, they might be able to service Parcel A completely without adding a treatment plant.That would be limited growth for the district. If they want sustainable growth, they need to get aggressive about renewable water resource acquisition with a water rights attorney that will go after these reallocation issues with the state.They have to be there lobbying heavy as all the other cities will be in there lobbying, too.The ones who speak the Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 11 of 15 loudest will get some.They also need to go after the Indian leases as the reallocation is no guarantee. Vice Chairperson Eck commented that the district is behind. Mr. Scott Davis stated that is correct.They need to really get out there and get more renewable water resources.They are currently only putting it into recharge and putting it back into the ground.The recharge will not grow; it is fixed unless they get additional sources and they put those in the ground.The best use of surface water is to treat it and put it in the distribution system.The more burden they can take off the drinking water system, the better. They need to work with the sanitation district in getting them to have reuse systems down in the piping in the new developments and talk to them about getting a recharge recovery area going. Vice Chairperson Eck commented,-when -they came -out with .the final costs, it was just the costs to produce the, water; getting it out to the system and providing _it is -additionaL Mr. Scott Davis stated that is correct.They did not look at distribution.They provided one reservoir to provide fresh water and blending. Vice Chairperson Eck asked if this is considerably higher in cost when compared to most of their other customers in this area.They are talking about over $2 a thousand 'gallons. Mr. Scott Davis stated these are infrastructure improvement costs.It depends on what costs he is talking about. Mr. Sippel commented he is looking at the time and a group is .slowly building outside. This, is important information, and he .asked if the vice chairperson could meet with these representatives later. Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 12 of 15 Vice Chairperson Eck commented he does have some issues and he would like to sit down with them and go over a plan of action.They are talking 3 to 5 years and the board is hoping 1 to 3 years.They have to figure out something soon and know where they are going. Mr. Scott Davis stated they need to start today with getting more allocation, getting the plant built and the interconnect built. Vice Chairperson Eck commented his suggestion on getting the allocation is to get an attorney. Mr. Scott Davis stated a water rights attorney would be the most proactive; they need to get somebody who would be in there lobbying and has the key contacts within the state organizations. Vice Chairperson Eck asked if his company works with people like that. Mr. Scott Davis stated they Vice Chairperson Eck asked if there is any problem with him sitting down with them to go over the issues. District Counsel Kay :Bigelow stated there is no problem with -thatlout she does know -some water rights attorneys that they can talk to about it -and .get some help on those things She -added -when the Gila River Indian settlement Went :through, one attorney -she is going to refer them to was cutting deals for many municipalities for long term leases with'the water that wasApeing :turned over -to the tribe. When -the -settlement was done, most of that water was -parceled out immediately.There is:some:allocation left over,.but:'they need to worry -about finding more renewable resources; Water Utilities Community Facilities District Meeting Minutes -of .February 6, 2007 Page 13 of 15 MOTION FOR EXECUTIVE SESSION )Chairperson Coleman asked how long the executive session will be. District Counsel Kay Bigelow stated that has been cancelled.It is not ready to come to the board or be heard tonight. ADJOURNMENT )Chairperson Coleman adjourned the meeting at 6:52 p.m. ACCEPTED THIS 20TH DAY OF FEBRUARY , 2007, 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 a m 2007. DAY OF FEBRUARY Aowg-Leg Douglas goleman Chairperson ATTEST: Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 14 of 15 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 6th day of February, 2007.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 14th day of February, 2007. Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of February 6, 2007 Page 15 of 15