2012-11-27_PWETC_AgendaPacket - Laserfiche WebLink

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Page 2 of 3 36 37 The Second Part of the Recommendation 38 39 Utility Needs, 40 41 Background The fee - supported Utilities in the City with significant un- funded capital needs are 42 the Water Utility, the Sanitary Sewer Utility, and the Stormwater Uitity. These utilities all 43 consist largely of underground piping systems that were installed over a period from the 1940's 44 to the 1970's as the City developed In addition, the Water Uitilty includes the City's water 45 tower, and the Stormwater Utility includes a number of City- maintained stormwater management 46 ponds. This capital infrastructure is provided by the City to deliver safe drinking water to the 47 homes and businesses in the City, to take away sanitary sewer wastewater to the Metropolitan 48 Council's sewer system and treatment facility for safe treatment, and to safely collect stormwater 49 run ofl; treat it, and deliver it to the environment via the streams, lakes, and other waterways of 50 the area. 51 52 Much of the piping in these systems is approaching 50-60 years of age, and was made of 53 materials that have been found to not last much longer than that if even that long. The cast iron 54 of the water mains is brittle and subject to leaking and breaks as the result of ground shifting 55 tree roots, etc. The clay tile of the sanitary sewer lines is similarly subject to leaks and bring. 56 Since the City pays St. Paul for drinking water, each leak or break in a line costs the City's 57 residents and businesses higher rates to account for that un -used water we purchase. Leska of 58 raw sewage into the ground pose a danger to the environment. 59 60 In an effort to keep current and future costa down, the City is using new materials and 61 technologies to replace or repair existing water and sewer mains. Where City streets are being 62 completely replaced, the water and sewer lines are being replaced (as needed) with more durable 63 materials. Where streets are not programmed for replacement for many years, the City is using 64 re- lining technology that puts a new plastic pipe inside the existing pipe, and does not require 65 excavation of the street. 66 67 The capital infrastructure funding gap over the next 20 years in these Utility funds is about $47 68 million out of total projected costs of $65 million. In other words, 72% of the projected costs are 69 currently un- fimded. 70 7I Recommendation The subcommittee recommends a long -term solution for funding the 72 significant capital replacement needs of these Utilities that is a combination of adding revenues 73 and transferring existing funds. 74 75 The first part of the recommendation is to increase the annual utility base fees by a total of $2.2 76 million in 2012, and to maintain that increase permanently going forward Approximately 77 $850,000 of that amount would be dedicated to Water Utility capital funding, approximately 78 $830,000 to Sanitary Sewer Utility capital funding, and the remaining approximately $500,000 79 would be dedicated to Stormwater Utility capital finding. 80