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HomeMy WebLinkAbout2014-09-16 WUCFD MINUTESWATER UTILITIES COMMUNITY FACILITIES DISTRICT CITY OF APACHE JUNCTION, ARIZONA REGULAR MEETING SEPTEMBER 16, 2014 The regular meeting of the District Board of the Water Utilities Community Facilities District, City of Apache Junction, Arizona, was held on September 16, 2014 at the Apache Junction City Council Chambers pursuant to the notice required by law. CALL TO ORDER Vice Chairperson Barker called the meeting to order at 6:02 p.m. ROLL CALL Board Members Present: Vice Chairperson Barker Mrs. Evans Mr. Serdy Mr. Wilson Mr. Waldron (Chairperson Insalaco and Mrs. Rizzi were absent.) Staff Present: Others Present: Frank Blanco, District Director Joel Stern, District Legal Counsel John White, District Finance Manager Michael Loggins, District Superintendent Donna Meinerts, District Treasurer Giao Pham, Utility Director Bryant Powell, Assistant City Manager Andria Samuels, Administrative Assistant Jan Mason, Deputy City Clerk APPROVAL OF MINUTES OF AUGUST 5, 2014 Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 1 of 13 ) Mr. Waldron MOVED THAT THE MINUTES OF AUGUST 5, 2014, BE APPROVED. Mrs. Evans SECONDED THE MOTION. VOTE:Unanimous. The motion carried. PROPOSED RESOLUTION NO. 2014-010, AUTHORIZING THE CREATION OF A TRADE NAME ) District Director Frank Blanco stated the resolution is for a dba (doing business as). Apache Junction Water Company was the district's old version of this but it was never voted on or brought before the board for approval.It was just picked up as the district's dba.The problem is the water district has been mistaken for being a private company by a federal agency when the district was trying to acquire some federal land from the General Services Administration.The water district wants to retain the legal name Apache Junction Water Utilities Community Facilities District which is the name the district was formed under.It was done under a special district, organized under A.R.S. § 48- 701.The purpose was for a municipal water provider.The water district is requesting the approval to adopt Resolution No. 2014-010 to have the dba, or doing business as, Apache Junction Water District so they would not be referred to any longer as Apache Junction Water Company, which implied they were a private water company. RESOLUTION NO. 2014-010, A RESOLUTION AUTHORIZING THE CREATION OF A TRADE NAME ) Vice Chairperson Barker called for a motion. Mrs. Evans MOVED THAT RESOLUTION NO. 2014-010, A RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION, ARIZONA), AUTHORIZING THE CREATION OF A TRADE NAME, BE APPROVED. Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 2 of 13 Mr. Waldron SECONDED THE MOTION. VOTE:Unanimous. The motion carried. PROPOSED RESOLUTION NO. 2014-011, DECLARING A PORTION OF ITS PUBLIC UTILITY EASEMENT LOCATED AT LOT 1111 OF THE GOLDEN VISTA R.V. BE EXTINGUISHED ) District Director Frank Blanco stated this is a resolution to abandon an eight -foot public utility easement that runs through lot 1111 and is not useable. The owner of the lot requested the public utility easement be extinguished.The water district does not plan on building any infrastructure on the public utility easement and is requesting the resolution be approved to extinguish the easement. Mr. Waldron asked if there were any other of these type of easements in the park. District Director Frank Blanco said lot 7 is one among several the water district will be coming back to the board within the near future to ask for approval to extinguish. District Legal Counsel Joel Stern stated he saw the plat of the park and there are several different sizes to the public utility easements.Some are four- foot and some are eight -foot. District Director Frank Blanco said he does not know why there are different sizes. There is a four -foot front and back setback that may have been mistaken for a public utility easement. Mrs. Evans asked if it is only an easement for the water district and no other utilities. Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 3 of 13 District Director Frank Blanco stated it is for public utilities and the district only wants to relinquish their rights to the easement and have them extinguished. Vice Chairperson Barker called for a motion. Mr. Waldron MOVED THAT RESOLUTION NO. 2014-011, A RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILIITIES DISTRICT (CITY OF APACHE JUNCTION, ARIZONA), DECLARING A PORTION OF ITS PUBLIC UTILITY EASEMENT LOCATED AT LOT 1111 OF THE GOLDEN VISTA R.V. RESORT IS NO LONGER NECESSARY FOR PUBLIC USE AND IS HEREBY EXTINGUISHED, BE APPROVED. Mr. Wilson SECONDED THE MOTION. VOTE:Unanimous. The motion carried. PROPOSED RESOLUTION NO. 2014-012, DECLARING THE SERVICE AREA OF THE APACHE JUNCTION WATER UTILITIES COMMUNITY FACILITIES DISTRICT TO BE CONSISTENT WITH ALL AREAS LOCATED WITHIN THE CITY OF APACHE JUNCTION CORPORATE LIMITS AND WITHIN ITS PLANNED GROWTH AREA )District Director Frank Blanco stated the district is asking the water board to adopt a resolution that would allow the district to continue along the road the city limits are moving towards.The planning area for the water district would be the same as the planning area for the City of Apache Junction with the exception of the area that is served by Arizona Water Company or any other private water company that might be in that area.The district boundary is not the same as the service area.When the district was formed it was based on the public works yard.There was one owner. When the formation of the district was approved it was approved based on one owner which was the city and did not go out for Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 4 of 13 public vote.The district boundary is not the same as the service area boundary.The service area boundary extends considerably beyond the original district boundary.The service area boundary is based on the customer area and the planning area.It includes an area within the city limits not served by Arizona Water Company and would extend to the city's planning area boundary.Arizona Water Company is different than the water district.They have a certificate of convenience and necessity.This certificate was issued by the Arizona Corporation Commission.The Arizona Water Company service area must be approved by the Arizona Corporation Commission.The water district is not governed by the Arizona Corporation Commission.It is a governmentally -owned utilities service area and is self- declared.The resolution that the district is asking to adopt is a policy for setting the water district service area boundary. District Legal Counsel Joel Stern stated when looking at the map that shows the city boundaries and water district service boundaries, it may remind the board members of the city general plan which shows the boundary going all the way down to Germann, which has been declared the city's future boundary. Vice Chairperson Barker asked if the boundary for the water district on Ironwood went down to Elliott Road. District Director Frank Blanco stated it does go to Elliott Road. Vice Chairperson Barker called for a motion. Mr. Waldron MOVED THAT RESOLUTION NO. 2014-012, A RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION, ARIZONA) DECLARING THE SERVICE AREA OF THE APACHE JUNCTION WATER UTILITIES COMMUNITY FACILITIES DISTRICT TO BE CONSISTENT WITH ALL AREAS LOCATED WITHIN THE CITY OF APACHE JUNCTION CORPORATE LIMITS AND WITHIN ITS PLANNED GROWTH, BE APPROVED. Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 5 of 13 Mrs. Evans SECONDED THE MOTION. VOTE:Unanimous. The motion carried. DISTRICT MANAGER REPORT None. DISTRICT DIRECTOR REPORT District Director Frank Blanco stated he did not have an update on the groundwater savings facility storage agreements. District Superintendent Mike Loggins gave an overview on the design of the Central Arizona Project water treatment plant.He showed a slide with the design layout and how the water district can utilize their space.On August 12, 2014 the water district had a kick-off meeting with Carollo to give them an idea of what the water district wanted for the design of the treatment plant, have everyone get to know each other, who the project manager is and who reports to who.On September 9, 2014, they had a design camp meeting and Carollo went over several different things with the water district.They made recommendations of how the treatment plant would work with package plant versus osmosis versus different types of treatment that can be used, different types of processes, how the district would tie into the existing water system, how electric would be brought in and how sewer would be connected.They went over preliminary information so that the water district could head Carollo in the right direction of what the water district is looking for.On October 1, 2014, the district should have 30% of the plans done and the district will be formalizing decisions for the near future.On November 3, 2014 the district will have 60% of the plans and specifications done and then sometime in mid -December plans will be 90% done.The district is expecting 100% of the plans in January 2015 so they can put it out to bid and start construction early next year.Carollo made a study analysis of what treatment process the district should use based off of what the capital costs are versus what the operations and maintenance costs would be over 20 years.Carollo's recommendation is a Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 6 of 13 package treatment plant as the district's best option at this time.The district looked at a package treatment plant in the valley up in Cave Creek that has been in operation for twenty years.There are several package treatment plants that can be purchased but there is only one in operation in Arizona.It is the one the district looked at.To keep this project moving along with construction the district may have to sole source it to this company.The district knows there are concerns about this but this is proven technology.It works in Arizona and has worked with Central Arizona Project water.The company has been in business 50 years and has over 50 plants all over the United States but only has one plant in Arizona that treats Central Arizona Project water.It has been in service for 20 years so the district knows it works for this process.Carollo feels the district should sole source it to a company but by sole sourcing the district may not get the best price so they also propose getting prices from the last five treatment plants they provided all over that are the same size as the district's to show they bid those plants against somebody else and their price was comparable.This helps the district speed up the bidding process so the district can keep up their pace and be done with the plant by early 2016. Mr. Waldron asked if they could do this. District Legal Counsel Joel Stern stated he had not had the opportunity to talk to the district director or the manager about this so he would need to talk to them.Sole source means one thing in the city arena and he thinks it means the same in the district arena.He will have to discuss it with them. District Superintendent Mike Loggins stated this is not a decision that has been made and the direction the district is going.It is just an option he wanted to present to the board so the district can move along with their project.Obviously the district has to follow the procurement procedures of the city.Joel will make sure they do everything legal. Vice Chairperson Barker asked what the alternatives were. District Superintendent Mike Loggins said the alternative is to bid it out just like they normally would.They would bid out a package plant and the designer cannot nail down all the details Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 7 of 13 on it because one package plant may have the inlet coming in 10 feet in the air another may be 2 feet off the ground.They cannot finish their design to exact detail and figure out all the costs because they are not sure what plant will get the treatment process.This nails the process down once the contractor can figure out what process they are going to use. This makes it a lot easier for the contractor to have more detail so they can finish up with no hidden costs that could come up in the end.The district discussed with Carollo the sewer connection that the district has to have at the plant and whether they should go from the plant to Baseline or go straight to the sewer plant to tie in.Another option Carollo presented to the district was the power supply in the area.They talked about having a dual feed from Salt River Project which means separate power supplies from different areas or substations or having one supply with a backup generator.The district has to make the decision whether they want to maintain a generator or have Salt River Project provide dual power sources to the district. Assistant City Manager Bryant Powell asked if there was a possibility to have both a backup generator and dual power supplies from Salt River Project. District Superintendent Mike Loggins stated it is an option. The district will be looking at what is the best redundancy for the district and the customers.Typically on a substation that serves different areas they would not have them go down at the same time unless there was a major catastrophe.Salt River Project had a power outage about two years ago at the substation at Power and University but they were able to reroute power through other substations.Within 6 to 8 hours they were able to bring everything back online. District Director Frank Blanco stated the other option with redundancy is they will still keep their connection with the City of Mesa and are working on that agreement.The capacity of the interconnect is close to the same capacity as the water treatment plant.They have this option as well and also wells which provide water. District Superintendent Mike Loggins stated the district will have more information to present about this at their next Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 8 of 13 meeting.He then discussed peak water demands with a peak month a little over 52 million gallons with the lowest usually in the spring or early fall which produces about 40 million gallons a month.The district demand has not been increasing much over the past four years.It is slowly increasing.Hopefully they will stay in this pattern of slowly growing but if a large development comes in the demand will go up.More infrastructure would have to be built and the development would have to build that infrastructure. District Director Frank Blanco talked about the Colorado River System Conservation program agreement.This agreement is important primarily due to a severe drought for over a decade. The drought has depleted Colorado River System aquaducts and reservoirs from Wyoming to Mexico.As a result, Apache Junction is facing some risks with the Colorado River which is providing much of the water for seven states.The seven basin states are Arizona, California, Nevada, New Mexico, some of Utah and Colorado and parts of Wyoming.There are declining levels at Lake Mead and Lake Powell as a result of the drought.Shortages affect some river water users.Whenever there is a shortage declared the agricultural users are the ones that first get the reduction.This could also affect water supplies and pricing to millions of consumers.Hydro generation is used in supplying water and that is directly related to the Colorado River water supply.Lake Mead feeds Lake Powell.The elevations on Lake Mead are the ones that are monitored for a shortage.There has been a gradual decline.Even though there has been rain it really has not changed the lake levels.Lots of snow and snow pack is what will make a difference in the coming winter months to stabilize water levels in Lake Mead and Lake Powell to mitigate shortages if declared.It may have an effect on some river water users.The Colorado River serves 40 million people and within the combined areas served by it those areas generate over $1.7 trillion in gross metropolitan product.When compared to other areas, it comes in number twelve in the world globally.The water in the Colorado River is very valuable economically.For agriculture, it generates just under $5 million on an annual basis.The gross metropolitan product is similar to the gross domestic product.Compromised hydro generation can effect power supply and pricing to millions of consumers from Arizona to Nebraska.The parties in the agreement are United States Bureau of Reclamation, Central Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 9 of 13 Arizona Water Conservation District, Metropolitan Water District of Southern California, Denver Water and Southern Nevada Water Authority.The purpose of the agreement is to establish pilot conservation programs in the years 2015 and 2016.Some of the $11 million funding will compensate river water users for voluntary reductions of taking Colorado River water.The idea behind that is by not taking the water out of the river the Bureau of Reclamation does not have to release as much water from Lake Mead and Lake Powell, so more water stays in the reservoirs rather than coming down the river and being used up by river users.Colorado River water users are the consumers that take water directly from the river versus the Central Arizona Project canal.Even though the district's water in the Central Arizona Project canal comes from the Colorado River they are not taking water directly from the Colorado River.They are taking it from the Central Arizona Project canal in areas such as Wellton and areas down by there.Those areas have pipelines that can take water directly out of the river itself.If the district can get some of the farmers to voluntarily reduce consumption then the theory is they can keep more water in Lake Powell and Lake Mead.The trigger of shortage declaration is elevation 1075.Some of the conservation options would be increasing water efficiency.Increasing the efficiency of how crops are irrigated is one of the conservation options. Fallowing existing agricultural lands that could have potentially a negative impact also by fallowing lands that might be growing important crops like alfalfa and citrus.You really cannot fallow a citrus grove without losing it after a year or so.The Lake Mead critical water level is 1075 with the first intake at elevation 1050.If both lakes reach the 1050 level then at that time there could be a danger in having a reduction in other waters besides agricultural.Second intake is at a 1,000 feet and third is at 800 feet.As the water levels get increasingly lower there is more danger of restrictions of Colorado River water usage. The 1075 level is the first level at which there could be a reduction declared by the Bureau of Reclamation. Vice Chairperson Barker asked how it would impact this area. District Director Frank Blanco stated the municipal and industrial users, all the city and the water district, would not be reduced at that elevation.They would continue to take the Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 10 of 13 same amount of water they are entitled to.Agricultural users would be the first ones reduced and also the non -Indian agricultural water would be one of the waters reduced.That is why the water is considerably less expensive than the municipal and industrial Indian category water. Mr. Wilson ask if the water the city is pumping into the ground for the aquifer would continue or if it would stop being pumped. District Director Frank Blanco said the water for recharge would also be one of the waters that is impacted.This is why they would want to take advantage of the groundwater savings facilities and underground storage facilities before the reductions take place.If the district has municipal and industrial water and they want to recharge it, it is still the same category and they can continue recharging it as well. There is water that is sold by Central Arizona Project for recharge and that is the water that would be discontinued as well as the agricultural water at elevation 1075.Funding for this project is 11 million dollars.The Bureau of Reclamation is contributing 3 million dollars and the other parties such as Central Arizona Water Conservation District, Denver Water, Metropolitan Water of Southern California and Southern Nevada Water Authority each contribute 2 million dollars.It is a pilot program and this program cannot fully offset the effects of the ongoing drought.The goal is for projects to develop future water efficiencies and water usage reductions to increase the viability of the Colorado River water system.Some of the sources of this report are Snell and Wilmer, the Central Arizona Project website and the U.S. Metro Economies, Global Insight. The office staff gave good information.The administration assistant specifically helped gather information together. Mr. Waldron asked at which trigger point shown on the slide of 1075 and 1000 would it affect the water coming to Apache Junction. District Director Frank Blanco stated at the trigger point of 1050 if a declaration is declared there could be some issues on receiving some Central Arizona Project water.At that time the water district would be relying more on recovering their existing groundwater storage.That is why it is important for Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 11 of 13 the district to continue ac6ruing additional long term storage credits so they can recover them in case a shortage is declared. Mr. Waldron asked if 1050 is the district's trigger point. District Director Frank Blanco stated it is. DISTRICT TREASURER REPORT None. ADJOURNMENT adjourned the meeting at 6:38 p.m. ACCEPTED THIS /-)1/DAY OF /VD Ve7(46.61C , 2014, BY THE CHAIRPERSON AND DISTRICT BOARD OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT,(CITY OF APACHE JUNCTION, ARIZONA). ) Vice Chairperson Barker SIGNED AND ATTESTED TO THIS 2014. ATTEST: ifKathleen Connelly District Clerk DAY OF /44er*Idi . irperson John S. Insalaco Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 12 of 13 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 September, 2014.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 30th day of September, 2014. Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of September 16, 2014 Page 13 of 13