Wednesday, June 17, 2009

Draft Sewer Plan: Perpetually Unfinished Business

This will offer 20 or so questions, several early answers from our former Public Works Director, plus a few comments from me submitted about 2 years ago.
But, the date really has little to do with this perpetually unfinished business, which will come up again and again.

And, because our sewer system -like our water system- is a Municipal Enterprise, its funding, including capital improvements, is funded by utility rates that system users pay.

That is not to say we don't have to be prudent and careful with the management of this fund, and the rates and system development charges that provide its revenue.
Anyway, rather than keeping this buried in my draft file, I might as well post it so those interested can read it or refer to it.

So, here goes:

How many people do you know who would willingly spend all day Saturday reading over 300 pages of a draft Sewer Plan?

OK, maybe a few engineers might do that.

Otherwise, only people like City Council members would do it, because they will need to understand why planning 20 years into the future is necessary, in order to justify making some important decisions that will affect how our sewer system must be expanded and upgraded, and these improvements paid for over that time.

Most people take sewers for granted as a basic necessity that is just -somehow- provided.
That's good, because the folks who operate our sewer system and waste treatment plant prefer to remain very low profile!
Remaining low profile means things are operating smoothly with little if any problems that can be noticed by citizens.

Bet you didn't know these fascinating facts:

• The City operates 324 miles of wastewater collection systems

• The Post Point Wastewater Treatment Plant has a peak capacity of 72 million gallons per day

• The City's sewer service area covers 30 square miles and serves 83,000 customers

• The elevation ranges from sea level to a height of 800 feet

• Treated wastewater is discharged into Bellingham Bay

• Treatment of wastewater is closely regulated by the State Dept of Ecology

• Population growth over the next 20 years will require building capital facilities costing about $191 million [factoring in estimated inflation]

• All of this funding must be raised either from ratepayers [2/3] or public Revenue Bonds [1/3]

• The Sewer Utility operates as an Enterprise Fund, which means its costs of operation must be matched by its revenues.

• Some carefully considered increases to both sewer rates and system development charges must be adopted to meet projected needs.

With this brief background it may be easier to understand why this topic should be of more than passing interest to everyone.
That is why this afternoon's Council Work Session was important.

Unfortunately, this meeting was not televised on BTV10, or well-attended, which is why I'm mentioning this subject in this blog.

In preparation for this meeting, I asked the 20 sets of questions shown below, and obtained early answers to most of them before the issue was tabled for more work and future consideration.

Answers given to these are summarized following each question.
Answers to the rest await their being asked again.

Stay tuned to see what decisions this -or a future- Council will make on this important issue
Questions & Answers

Q1. The Sewer system dynamics make a good illustration of what is meant by 'level of service', and can also be applied to transportation.
By identifying pinch points and suggesting parallel piping, larger piping, holding tanks and combined flow mitigation,
these have direct counterparts to handling traffic.

A1. Agreed regarding traffic. That's why we have Deemer, Cordata and Eliza parallel to the Guide.

Q2. In the various scenarios, I don't see the idea of relocating the big interceptor that crosses Whatcom Creek.
Was this idea considered?
What is the estimated cost?
Is this the time to consider such an idea?

A2. We don't have the Whatcom Creek pipe in because relocating it doesn't help the sewer system.
We can do it by adding a pump station on one side of the creek.
It is millions and purely optional.
We can do it anytime someone provides the money.

Q3. Regarding the proposed C Street Remote Storage facility, would this be located near or on waterfront property?
Is this included in waterfront redevelopment planning?
Will this idea serve to excite the neighborhood?

A3. C Street would be a large vault built under the renovated C Street at the waterfront.
Maybe 50 feet wide, 500 feet long and 20 feet deep.
We would essentially drive on the roof.

Q4. Sewer service is a valuable commodity!
Do we need to reserve our existing capacity preferentially for in-City use?
How does this impact annexations and/or service to Water District?

A4. Quick feedback while working on the bigger answers: the sewer interlocal from 1974 does not expire after 20 years.
It says that the term is for a period of AT LEAST 20 years.
That means that it goes forever unless we mutually agree to a new agreement. I have contacted LWWSD to start the process.

A4. The Comp Plan planning section reviews the entire service area and takes into account the population projects and update TAZ data to determine adequate sanitary sewer capacity. The intent of the plan is to have a living document that can be updated as necessary. There is ‘no reserve’ but rather built in capacity for the densities that have been approved for current in-fill strategies. Example: if a future Council decided on limiting service to an area but wanted to expand density in another, the plan could be amended to achieve this goal or the capacity is already built-in to the system. How does this impact annexations and/or service to Water District? Generally, most annexations are in areas within the City’s UGA and those areas have been included in the planning/capacity analysis for this particular comprehensive plan. Unless during the annexation process zoning changes were being recommended to increase densities that may have not been originally planned for, there is again, built in capacity for those annexations. The City only serves one Water District with sanitary sewer service, LWWSD and the flows from that District are included in this plan based on 1) contract amount and the draft LWWSD comp plan.

Q5. Do we charge SDCs for the Water District? Can we? If not, can we raise sewer rates sufficiently to cover this subsidy?
What does 'average GPM' flow rate translate to in terms of peak flow?
If we increase SDC for city dwellers, doesn't that mean the Water District gets an increase?
Where do we stand in renegotiating the Interlocal with the Water District?
It was signed in 1974 and was to be in effect for 20 years. That ended in 1994!
I know rate increases will be 50% higher in proportion to the City, but is this enough?

A5. Yes, [we do charge SDCs for the Water District] however, the only District receiving sewer service is LWWSD and they have a contract that allows for a specific amount of sewage flow, therefore, we would not be able to charge an SDC for each one of their internal customers that are connecting to their system. We could, if a new district required service charge the provider for the new main connection and service to the City’s system, i.e. Ferndale or Lummi, etc

Q5. Can we? If not, can we raise sewer rates sufficiently to cover this subsidy?

A5. The SDC are a ‘buy-in+growth’ concept that the Council approved during the 2004 ‘cost-of-service’ model rate study. If a District where to ask for a new connection, the SDC would apply. The SDC is based on ‘meter size equivalent’ so generally there is really no ‘subsidy’ here.

Q5. What does 'average GPM' flow rate translate to in terms of peak flow?

A5. Depending on the context, but ‘average GPM’ is the expected flow in the system or from a customer on average over a specific time period. The industry usually uses ‘average annual GPM’ or ‘average annual daily flow.’ ‘Peak flow’ is the highest expected flow rate during a specific period of time; it can be in a daily format or an annual flow rate depending on whether one is discussing water or wastewater. In wastewater, we generally use daily peak flows as our way to gauge sizing of components and facilities.

Q5. If we increase SDC for city dwellers, doesn't that mean the Water District gets an increase?

A5. SDC are only paid at the time of permit, we would not be issuing any new permits to a water district unless they were to ask for a new connection. So, raising SDC for all new customers, inside and outside of the City only affects those services that are directly connected to the City’s sanitary sewer service.

Q5. Where do we stand in renegotiating the Interlocal with the Water District?

A5. The City is currently reviewing the Interlocal Agreement and is in the process of trying to reopen the process for negotiating. Internal meetings are on-going to outline strategies and objectives. The sewer interlocal from 1974 does not expire after 20 years. It says that the term is for a period of AT LEAST 20 years. That means that it goes forever unless we mutually agree to a new agreement.

Q5. It was signed in 1974 and was to be in effect for 20 years. That ended in 1994!
I know rate increases will be 50% higher in proportion to the City, but is this enough?

Q5. The Cost-of-Service model includes an analysis that accounts for the revenue generated by the 1974 agreement and subsequent payment options on new facilities, i.e. Oak St Lift Station Upgrade in 2005.

Q6. Section 3 assumes the County will OK the City's request for additional UGA land supply.
Since this is in question, how will less land supply impact the analysis of future needs?

A6. The analysis is conservative in nature and as a living document with an active hydraulic model it is intended to be updated and used on a continual basis; the plan can be modified as planning scenarios change and growth is either slowing or increasing. We will update and reevaluate the CIP on a regular basis to ensure that our targets are being met.

Q7. Are there further plans for separating sanitary and storm water, aside from reducing existing I & I?

A7. In 1978-1982, the City undertook a huge storm/sewer separation project that basically removed all known storm water from the sanitary system with some exceptions and no removal of roof drains from property owners. We are constantly evaluating the sanitary system through portable and permanent flow meters to determine unknown sources of storm water into the system. There are several large storm pipes that are in need of separation but unfortunately, no storm systems exists in the drainage area nor are those pipes easily constructed at this time due to existing structures and topography. These are in the downtown area, along the waterfront and it is expected that as the waterfront develops, these will be separated into new storm systems.

Q8. Since Yew Street has not been up-zoned, why is the extension to Samish Way at Lake Padden needed?

A8. There are existing homes that are in need of sanitary sewer that would remove septic systems from the Lake Padden drainage area.

Q9. There are expensive plans in Chapter 7 for sewer line extensions west of the airport and east of I-5.
Are these considered likely annexations?
If not, why plan for them?

A9. Annexations and their likelihood were derived from the Planning Dept and it’s direction from Council. It is not fully known on annexation timeliness nor likelihood. However, these areas are within the City’s planning area for wastewater service and thus need to be considered in the calculations at this time.

Q10. What are our plans for providing sewers to currently un-sewered areas in the City, like the South Neighborhood?
Is significant growth likely for this area? Enough to justify costs?

A10. The City approached this neighborhood in the mid-90’s as a potential candidate for a Utility LID (Local Improvement District) but after analysis the cost did not justify the improvements. Depending on neighborhood sentiment and growth, it may be advantageous to review this again.

Q11. The suggestions for eliminating bottlenecks, increasing efficiency, changing treatment technology and expanding unit processes and unit operations at Post Point seem well-conceived and phased.
What is the practical limit on this site?
I note a hydraulic capacity expansion to 82 mgd is suggested.
Is that the maximum likely?
What are plans once Post Point's ultimate capacity is reached?

A11. The site expansion would be limited for any continued expansion to the west and south by the new recommended improvements being built in 2009-2012. The City’s purchase of the McKenzie Ave property allows for some additional growth beyond the current proposal most likely into 2030. After that, if no additional property is obtained to the north (Port of Bellingham land) then possible upgrades to existing process with newer technologies that do not require larger footprints may be an option.

Q11. note a hydraulic capacity expansion to 82 mgd is suggested. Is that the maximum likely?

A11. The City has experienced flows at the WWTP around 72MGD instantaneous, so the 82 MGD and the higher 107MGD are good planning numbers that are consistent with growth projections and the planning storm of 2004.

Q11. What are plans once Post Point's ultimate capacity is reached?

A11. Hydraulically, additional collection system storage or high rate treatment facilities may be necessary within the collection system at key conveyance points to meet futre needs, similar to what is being recommended for the collection system in 2012.

Q12. What about nutrient removal? Is this for Nitrogen? Will it work on Phosphorus?
Where is DOE coming from on this?
When does our existing NPDES permit expire?

A12. Based on discussions with DOE, nutrient limits (ammonia, N, and/or P) are not likely to be imposed during the planning period. Furthermore, the current recommended expansion is not designed to provide nutrient removal per se (although bio-P is provided via the anaerobic selector). The planned expansion can be modified if needed at some future date, to accommodate nutrient removal. The City received its new NPDES permit on November 02, 2007, it is good for 5 years from that date.

Q13. Recommended conveyance systems improvements fall largely at the edges of City limits, some in UGAs.
If the City must finance these prior to annexation, isn't that an undue burden on existing taxpayers?
Will Latecomers fees recover all these costs?

A13. If any utility improvements are installed by ratepayer funds, the City will assess property owners a future latecomer fee to access the system. Another possible way to achieve improvements prior to annexation or during would be to form a Utility LID. Costs that are associated with capacity are rolled into the SDCs and new developer pays the buy-in + growth, thus paying back the cost that the City incurred to make the necessary capacity available to the new customer.

Q14. Chapter '11' for Capital Improvements Plan is scary!
But, seriously, the Basis for Estimated Cost on page 11-5 is interesting.
Can or should this methodology be applied to other capital projects?
Like a Library?

A14. Yes, many other organizations, especially the Federal Government use ‘Cost Basis of Estimate’ or BOE. The Cost Basis of Estimate provides a record of the procedures, ground rules and assumptions, data, environment, and events that underlie a cost estimate’s development or update. Good documentation supports the cost estimate’s credibility, aids in the analysis of changes in program cost, enables reviewers to effectively assess the cost estimate, and contributes to the population of data bases for estimating the cost of future programs.

Q15. Thank goodness this isn't Chapter 11!
Good job of presenting the results of many complex activities and projects.
The point needs to be made clearly these total $110 million in present day costs.
The $191 million takes into account escalation over time and on time.
Regardless, it is good news that only 30% of the total amount must be raised from bonds, grants and other sources other than rates & SDCs.
Having to raise $33 million present day or $60 million escalated will be far more acceptable for Council to approve.

A15. No comments received.

Q16. The rate increases of 7% for 2008 and 7.68% for 2009 are OK with me because they do seem necessary because they address a known deficiency earlier rather than later.
But, some others may feel differently and an alternate phasing might be advisable to have in your back pocket.

A16. Phasing options will be available for discussion.

Q17. The SDC increases are quite substantial and will probably be fought by the BIA and others.
So, timing is important! Maybe early December after elections?
You might also consider a phasing plan for SDCs, although its probably better to just get beaten up once instead of multiple times.
But, a $4201 increase over the existing $3436 SDC is a big jump! 122%

A17. This will be something that we will want to discuss at the November 19th Council session on water/sewer rates.
A phasing plan is always an option and if Council like to explore the possibility of phasing the SDC, we will have several courses of action to choose from.

Q18. The comparison to other cities on page 12-15 is useful.
But only Kirkland is shown as having a higher SDC AFTER we increase ours.
That may be a negative.

A18. No comments received.

Q19. Appendix D - Water District Agreement needs revisiting!
I know we can't rescind it, but we can change it!
Changes in circumstances is really all we have to claim.
Since 1974 we have finally discovered Lake Whatcom is our reservoir and taken significant action to protect it.
Those actions cost dearly and all parties need to share more equitably!
Sudden Valley should not be considered a low cost community.
Other developments around the Lake are certainly not low cost either!
This sewer agreement is leverage the City ought to be using better.

A19. No comments received.

Q20. It would be nice to get the changes is SDCs and rates into the 2008 budget, whether before we approve on Nov 26 or early next year.
But, if Water rates and Stormwater rates are to be increased as well, you need to think about what's most important and start with that.
It will be very nice to get these big utility funds updated to last several years into the future, regardless of administration.
Including phased increases is a very smart way to do that, for multiple reasons.

A20. No comments received.