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HomeMy WebLinkAbout11-09-06 Impact Fee Advisory Committee Minutes.doc** MINUTES ** CITY OF BOZEMAN IMPACT FEE ADVISORY COMMITTEE THURSDAY, NOVEMBER 9, 2006 7:00 P.M. ITEM 1. CALL TO ORDER AND ATTENDANCE Chair Tim Dean called the meeting to order at 7:02 p.m., in the Upstairs Conference Room at the Alfred M. Stiff Professional Building, 20 East Olive Street, Bozeman, Montana. Members Present: Tim Dean, Chair Debra Becker Rick Hixson Ken Eiden Nicholas Lieb Anna Rosenberry Members Absent: Randy Carpenter Ron Kaiser Bill Simkins Staff Present: Sean Becker, Commissioner Liaison Chris Saunders, Assistant Planning Director (arrived at 7:32 p.m.) Robin Sullivan, Recording Secretary Guests Present: None ITEM 2. MINUTES FROM SEPTEMBER 28TH AND OCTOBER 26TH, 2006 September 28 Chair Tim Dean announced the minutes of the meeting of September 28, 2006, are approved as read. October 26 Chair Tim Dean announced that the minutes of the meeting of October 26, 2006, (for which no quorum was present) were approved as noted. ITEM 3. PUBLIC COMMENT No comment was submitted under this agenda item. ITEM 4. CITY COMMISSION LIAISON Commissioner Liaison Sean Becker stated the City Commission has adopted the Wastewater Facility Plan and intends to dedicate wastewater impact fees to fund those portions of the priority projects that are growth related. He noted that use of the impact fees must go through this Committee, with its recommendations being forwarded to the City Commission for consideration and final approval. Commissioner Becker noted that the impact fee study is based on the Wastewater Facility Plan, and acknowledged there are some moving targets yet to be addressed. He stressed that this Committee’s perspective and recommendations are important to the Commission in its deliberations. ITEM 5. CITY OF BOZEMAN ENGINEERING, BOB MURRAY AND HDR, AMANDA McINNIS – WASTEWATER FACILITY PLAN (Meeting and discussion to review the 2006 wastewater facility plan which will be utilized by HDR to prepare an update to the wastewater impact fee. The wastewater facility plan will also form the basis for an update to the wastewater impact fee capital improvements program.) Chair Tim Dean noted the consultant is not present and asked if the meeting should continue, particularly since this Committee needs to hear a presentation from HDR Engineering before it proceeds any further. Anna Rosenberry stated it is important for those not familiar with the plan to hear about it, either now or at a future meeting. Debra Becker stated that, if this Committee is to make recommendations on the impact fees, then it needs to understand the plan. She acknowledged that this Committee does not approve the plan; however, it provides the basis for the impact fees. City Engineer Rick Hixson stated that many of the projects in the Wastewater Facility Plan are for the Wastewater Treatment Plant. He noted there are a number of elements driving the need for expansion and renovation of the plant. It is currently at capacity, based on its ability to treat for Biological Oxygen Demand (BOD), and is currently incapable of treating the wastewater to the level needed to meet the City’s discharge permit under the new regulations, which include dramatically reduced levels of nitrogen and phosphorous. The City Engineer noted that the plant is now an activated sludge treatment facility and treats the sewage to a secondary treatment level. To meet the new requirements, a biological treatment removal process must be implemented; and that process will almost completely remove the nitrogen and phosphorous, thus allowing the City to meet its permit levels. City Engineer Hixson stated that expansion of the facility will include adding hydraulic capacity to accommodate growth; and that portion of the costs can be funded by impact fees. The portion of the costs due to the change in technology, however, is not eligible for impact fees, with the possible exception of that small portion that can be attributed to capacity expansion. He indicated these are issues this Committee must consider when looking at the impact fees. Finance Director Anna Rosenberry stated the estimated cost of the first phase of the Wastewater Treatment Plant project is $33 million. Responding to Ken Eiden, Rick Hixson acknowledged that much work has been done at the Wastewater Treatment Plant over the past few years, with some of the work relating to the operation of the plant while some of the work has related to capacity expansion. He cited the addition of a second clarifier and the conversion of a portion of the plant to another digester unit as examples of the work done. He indicated that, while a whole new process is to be implemented under the capital project in the Wastewater Facility Plan, most of the head of the plant can be reused or converted since the digesters and clarifiers can still be used at the beginning of the treatment process. He also noted that the aeration ponds will still be used, just in a different manner. Further responding to Ken Eiden, Rick Hixson confirmed that the new process is a direct result of the Montana Department of Environmental Quality’s mandate to meet the new stricter requirements that have been implemented by the Environmental Protection Agency. Commissioner Sean Becker stated the City has been granted numerous extensions to meet the new standards; and the Commission is now faced with the need to either spend $2 million on disposable improvements or $33 million for first phase of the new process. He noted the result of implementing the new process will be meeting the standards of the discharge permit and putting cleaner water into the East Gallatin River. Rick Hixson stressed that the City must continue to treat the wastewater while the new process is being constructed and implemented; and it is important that the level of treatment not decline during that time. Responding to Ken Eiden, Anna Rosenberry stated the consultant has suggested possibly one-third of the costs of expanding and improving the Wastewater Treatment Plant would be eligible for impact fees. Responding to Debra Becker, Rick Hixson stated there are three phases to the plant improvements. The first phase is estimated at $33 million and includes changing from the current activated sludge treatment process to the biological nutrient removal process through several improvements; the second phase is estimated at $34 million and includes expansion of the plant’s capacity to accommodate the community’s population at 2025; and the third phase is estimated at $9 million and includes tweaks to the waste water treatment process. Rick Hixson noted that the effluent from the plant is currently treated to a secondary level, and it must be improved to a tertiary level to meet the new EPA regulations. He cautioned that, if the plant’s discharge is not brought into compliance with the permit limitations, it may become necessary to use the IP (infiltration/percolation) beds. He noted that, to do so, the City must undertake a groundwater study to show that it is not adversely affecting the East Gallatin River downstream. He also noted the IP beds are near the interstate and, as a result, are readily visible and unattractive when used. He suggested an option to discharging water treated to the tertiary level into the East Gallatin River is possibly to reuse it as irrigation water for the nearby golf course or the sod farm. Rick Hixson stressed that the City is at its physical limit on treatment because the technology needed does not exist at the current plant. He then indicated that the EPA has divided the country into eco regions; and this is one of the most stringent regions. Rick Hixson stated it is important to start thinking big city and acknowledged that few are used to doing so. He noted that the population assumptions in the facility plan are 56,000 in 2015 and 72,000 in 2025. He cautioned that the plant size and technology will limit the community’s ability to grow if the improvements are not funded. Responding to Debra Becker, Rick Hixson stated that while construction of the new plant is being undertaken, some changes will be made in the way the water is routed through the aeration basins, with air being pumped into some of the basins and the others being used to de-nitrify the water. He noted it will be necessary to use the IP beds this summer, and it will be essential to ensure that the discharge meets the permit limits. Responding to Tim Dean, Anna Rosenberry stated that the City will not borrow any monies until after the design phase has been completed. She noted that staff wants to review both the water and wastewater projects for the next five years with the Committee during its January meeting. She indicated that the Wastewater Treatment Plant is the No. 1 priority project in that fund. Further responding to Tim Dean, Assistant Planning Director Chris Saunders stated that the timeline for developing a recommendation to the City Commission has slipped and, as a result, will not be the topic at the December 14 meeting. He noted the consultant will submit a formal document that goes through the methodology used to develop the proposed impact fees. Responding to Debra Becker, Rick Hixson stated the design phase will take one year, but the impact fee study will not take that long. Anna Rosenberry stressed that the Committee’s recommendation on how to spend impact fees through the five-year capital improvement program is entirely separate from the analysis of what the impact fees should be. Rick Hixson drew attention to the collection system, which is another element of the Wastewater Facility Plan, noting that upgrades are needed to accommodate additional growth related flows. He noted that a new map of the system is to be included, with new trunk mains and enlarging of existing mains identified. He indicated that expansion of the existing sewer mains is generally impact fee eligible. Responding to Nicholas Lieb, Rick Hixson estimated the total cost of the upgrades and expansions at $55 million. Responding to Debra Becker, Assistant Planning Director Chris Saunders indicated that all of the impact fees are independent, and the City Commission will be acting on them separately. He expressed his hope that the reviews can be done quite quickly but stressed the importance of ensuring that adequate time is taken to provide for a smooth process and correctly done studies. Responding to questions from Nicholas Lieb, Anna Rosenberry stated that a majority of the costs for upgrading the Wastewater Treatment Plant are not related to capacity expansion, so only a small fraction of those costs will be eligible for impact fees. She noted that staff and the Commission have been aware of this impending project and have raised the monthly service rates to accommodate a portion of the costs. As of this date, those increased rates have generated adequate revenues to fund the design of the plant improvements; and she estimated that $20 million will be borrowed for Phase I of the improvements. Responding to Tim Dean, Anna Rosenberry stated there is nearly $10 million in wastewater impact fees. Tim Dean stated that, while the information from City staff has been very helpful, it is essential that the Committee hear from the consultant prior to making a recommendation; Assistant Planning Director Chris Saunders stated he expects to see the consultants three more times before the public hearings are scheduled. Rick Hixson stated the City is able to continue with operation of the existing Wastewater Treatment Plant because Superintendent Tom Adams is running it very well and because the City is operating under an extension for meeting the new regulations. He cautioned that, on any given day, the plant encounters 10 to 15 percent of BOD from a single source, which has a significant impact on the plant’s operation. The load on the plant from that one source is essentially the same as the impact of 3,000 to 5,000 houses on any given day. Responding to Debra Becker, Assistant Planning Director Saunders stated that the sewer rates are based on water consumption. Rick Hixson indicated that an extra strength discharge surcharge is added for those businesses producing that type of sewage; however, the additional fee does not cover the actual costs of treating it. He suggested that a per-pound fee for BOD might be a more appropriate method of assessing those costs. Further responding to Debra Becker, Chris Saunders indicated that this Committee could consider those fees and make recommendations on how to more equitably charge for the services provided. In response to questions from Debra Becker, Rick Hixson identified other special circumstances within the community, noting that businesses like Scientific Materials and Lattice Materials often generate some odd discharges which impact the operations at the plant. Also, automotive grease and restaurant grease can impact the plant’s operations. He noted that, to identify industrial wastes that might impact the plan, new businesses are required to fill out a pretreatment survey and meet all regulations. Commissioner Sean Becker noted the City Commission is looking at a plan to decrease flows to the plant, noting that the use of low flow faucets and low flow toilets has allowed the community to grow without significantly increasing discharge into the plant. Rick Hixson noted that the drought has lowered ground water levels as well as staff’s efforts to address infiltration problems over the past few years. Anna Rosenberry noted that the City spends a lot of money on conservation plans, programs and advertising; and the result is that it is selling less water and getting less revenue. Responding to Debra Becker, Rick Hixson stated the costs of treating a pound of BOD are not part of the impact fees; rather, he will ask the Commission to adopt a resolution through the rate setting process. Responding to Tim Dean, Assistant Planning Director Saunders indicated the 5-percent growth rate used in the facility plan is actually lower than the 7-percent growth rate that the community is currently experiencing. Also, Rick Hixson noted that the city’s daytime population is 20,000 more than the actual population. Anna Rosenberry stressed that the Phase I improvements are needed now; the timing for construction of Phase II will be based on the population and growth rate. Responding to Sean Becker, Assistant Planning Director Saunders stated that the daytime population can be included in the calculations for water and wastewater impact fees. He noted, however, that the biggest issue is streets because the daytime population uses those streets to enter and exit the city but resides outside city limits. Responding to Debra Becker, Anna Rosenberry stated the five-year capital improvement program is separate from the facility plan and includes Phase I of the plant improvements. Responding to Tim Dean, Assistant Planning Director Saunders stated a desire, where possible, to have same service City impact fees in line with those assessed by the County. He noted, however, that if the County continues some of its policies, the result may be to force a higher growth rate in the cities rather than in the unincorporated county. The final outcomes will depend on the studies being conducted. Rick Hixson cautioned that if the County allows small on-site sewage treatment systems, the results could be similar to those being experienced around Helena. Responding to Debra Becker, Assistant Planning Director Saunders stated that at the present time, if a septic system fails in the County and is close to the City’s system or another good system, the property owner is required to connect to the good system. Commissioner Sean Becker noted that the City and County are working on an interlocal agreement to mesh their standards. ITEM 6. OLD BUSINESS There was no discussion under this agenda item. ITEM 7. NEW BUSINESS There was no discussion under this agenda item. ITEM 8. SETTING OF NEXT MEETING DATE Chair Tim Dean asked when the next meeting is to be held; Assistant Planning Director Chris Saunders responded the next regularly scheduled meeting is Thursday, December 14. Tim Dean indicated he cannot attend on that date; Debra Becker stated it would also be an issue for her. Assistant Planning Director Saunders indicated he will contact Randy Goff and then let the Committee know when the next meeting is scheduled. ITEM 9. ADJOURNMENT There being no further business to come before the Committee at this time, Tim adjourned the meeting at 8:20 p.m. _______________________________________ ____________________________________ Tim Dean, Chairperson Chris Saunders, Assistant Planning Director Impact Fee Advisory Committee Planning and Community Development and Staff Liaison to IFAC