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HomeMy WebLinkAbout01/08/1990 City Council 00345 MINUTES OF THE CITY COUNCIL MEETING HELD ON JANUARY 8, 1990 The Regular Session of the City Council of the City of The Colony, Texas was called to order at 7:00 p.m. on the 8th day of January, 1990 at City Hall with the following Council roll call: Don Amick, Mayor Absent Rick Harris, Mayor Pro-rem Present Steve Withers, Councilman Present Mike Alianell, Councilman Present Steve Glazener, Councilman Present Dick Weaver, Councilman Present Joel Marks, Councilman Present and with six present, a quorum was established and the following items were addressed: PRE-COUNCILWORK SESSION 1. DISCUSSION OF CONSENT AGENDA ITEMS 4A - Councilman Weaver noted that the word one needs to be changed to ten on item number 7 on the December 18, 1989 minutes. 4B - Bill Hall explained that David Rolbiecki and Judy Talbot have been contacted by people interested in the training program from Carrollton and Flower Mound as well as The Colony. Mr. Hall said he would cover this school more thoroughly in his report noting it may bring in approximately $6200.00. 2. DISCUSSION OF REGULAR AGENDA ITEMS - None 7:10 - Recess until 7:30 p.m. REGULAR SESSION AGENDA 1. PLEDGE OF ALLEGIANCE Mayor Pro-rem Harris led the Council and audience in the Pledge of Allegiance to the flag of the United States of America. 2. CITIZEN INPUT Donald Houston, 7600 Westshore Dr. reported that members of R.S.V.P. had g~ven 2000 hours of their time in 1989 and hoped to increase that number by 1/3 in 1990. 3. PUBLIG HEARING ON APPLIGATION OF THE GITY OF THE GOLONY, TO AMEND APPENDIX A-ZONING, SECTION 17-104, RELATING TO THE LANDSGAPING OF SITE PLANS, SEEKING TO HAVE THE COMPREHENSIVE ZONING ORDINANGE OF THE GITY AMENDED SO AS TO REQUIRE ALL NEIGHBORHOOD SERVIGES, GENERAL RETAIL, SHOPPING GENTER, INDUSTRIAL, HEAVY GOMMERGIAL, LIGHT GOMMERGIAL, BUSINESS PARK, OFFICE 1 AND 2, MOBILE HOME, AND MULTI-FAMILY 1,2,3, 0034-: j AND 4 TO BE LANDSCAPED Councilman Marks moved to open the Public Hearing and Councilman Alianell seconded the motion which carried with all members voting Aye. Bill Hall said that staff along with a committee had been working on a landscaping ordinance for some time and deferred to Mr. Bob van Til to report. M. van Til said this request is to amend Section 17-104 in the zoning ordinance to require landscape plans with the site plan approval. Mr. van Til said 6 months the committee started working on an ordinance but it will not be complete for approximately a month, however, this amendment is ready for action now. Councilman Weaver moved to close the Public Hearing and Councilman Alianell seconded the motion which carried with all members voting Aye. 4. CONSENT AGENDA A. CONSIDERATION OF APPROVAL OF MINUTES OF THE DECEMBER 4 AND 18 COUNCIL MEETINGS Councilman Glazener moved to approve the minutes with the correction noted in the Pre-Council Session and Councilman Weaver seconded the motion, which carried with a unanimous roll call vote. B. CONSIDERATION OF AN ORDINANCE AMENDING CHAPTER 10, ARTICLE III, SECTION 10-60 RELATING TO PERSONNEL; ADOPTING A REQUIREMENT TO HAVE A CERTIFIED FOOD SERVICE OPERATOR; INCLUDING DEFINITIONS; REQUIRING FOOD SERVICE OPERATOR CERTIFICATION FOR SUPERVISORY PERSONNEL OF FOOD ESTABLISHMENTS WITH THE CITY LIMITS Councilman Glazener moved to approve the ordinance as written and Councilman Weaver seconded the motion. Bill Hall gave a brief background of the ordinance, noting this is the second reading. The motion then carried with a unanimous roll call vote. C. CONSIDERATION OF A RESOLUTION AUTHORIZING AN INTERLOCAL AGREEMENT BETWEEN DENTON COUNTY AND THE CITY OF THE COLONY FOR THE PROVISION OF FIRE PROTECTION SERVICES Mr. Hall said this is a standard annual agreement whereby the City provides fire services to unincorporated areas of Denton County, noting that the amount of money is down by $5000.00 (5%). Councilman Glazener moved to approve t'he agreement and Councilman Weaver seconded the motion, which carried with a unanimous roll call vote. D. CONSIDERATION OF A RESOLUTION AUTHORIZING AN INTERLOCAL AGREEMENT BETWEEN DENTON COUNTY AND THE CITY OF THE COLONY FOR THE PROVISION OF LIBRARY SERVICES Mr. Hall said this is a standard annual agreement whereby the City provides library services to unincorporated areas of Denton County, noting that the amount of money is up by $6500.00. Councilman Glazener moved to approve the agreement and Councilman Weaver seconded the motion, which carried with a unanimous roll call vote. 5. RECEIVE PRESENTATION FROM BILL LANGFORD REGARDING THE WATER AND SEWER RATE STUDY AND FIRST READING OF AN ORDINANCE RELATING TO SAME Councilman Harris read the caption of the ordinance as follows: AN ORDINANCE OF THE CITY OF THE COLONY, TEXAS, AMENDING CHAPTER 12, ARTICLE I, SECTION 2, RELATING TO THE WATER AND SEWER CODE, BY AMENDING SECTIONS 3, 5, 6, 7 AND 10 OF THE WATER AND SEWER CODE AS ADOPTED BY ORDINANCE NO. 449 SEPTEMBER 29, 1986; PRESCRIBING AND SETTING USER RATES AND CHARGES FOR SALES AND SERVICES OF THE WATER AND WASTEWATER SYSTEM OF THE CITY OF THE COLONY, TEXAS; PRESCRIBING THE TIME FOR PAYMENT OF ACCOUNTS AND PENALTIES FOR NO-PAYMENT; ESTABLISHING DEPOSITS FOR UTILITIES; REPEALING ORDINANCES, RESOLUTIONS, AND ORDERS IN CONFLICT HEREWITH; PROVIDING A SAVINGS CLAUSE; PROVIDING A PENALTY; AND PROVIDING AN EFFECTIVE DATE Bill Langford covered information in the draft rate study he had prepared, explaining the various tables with narrative. (See Attachment "A"). Councilman Marks asked why this increase is necessary. Mr. Langford said the operating costs and depreciation were not covered by the present rates and that the $785,000.00 was not available to be transferred next year into the General Fund, going on to say he felt it is appropriate the money come from the water and sewer system. Councilman Weaver said this is an increase in taxes to the people, no matter what you call it and asked Mr. Langford if he inquired as to the taxes of other cities when he inquired about their water and sewer rates. Mayor Pro-tem Harris said Mr. Langford was not commissioned to do a tax study and that he was not here to be badgered. Councilman Marks asked if Mr. Langford was told the City needed to raise a certain amount of money and then came up the rates necessary to do so. Mr. Langford said he studied audits, budgets and financial reports. Councilman Marks said this is a 44% increase. Mr. Langford said we (the City) need to keep up the City's financial standards and if more money is raised than is needed, the reserves can be strengthened, noting it is very important to move to a use based system, which will help the low use customers. Mr. Langford said this would encourage conservation by causing users to be more conscious of how much water they are using. Mayor Pro-rem Harris said the main objective was not to balance the budget but to look at revenues to improve the system and then suggested a work session be called to discuss the rates. Councilman Withers asked what impact the increase would have. Mr. Langford said the immediate impact would not be great. Councilman Withers said we need to re-examine these in the 2nd year. Mr. Langford agreed. Councilman Withers also asked when a marked decrease in consumption would be seen and Mr. Langford said depending on growth, maybe none would be seen. Councilman Alianell stated that it appears the city has been operating on a break even basis for the past 3 years without considering depreciation and if we consider depreciation, the city is losing money. Mr. Langford said the city must start addressing that issue. Councilman Weaver said that when the M.U.D. was in existence $500,000.00 was allocated from the fund to help pay Ad Valorem taxes., but now the money is being transferred to the General Fund and we have to either increase taxes or water rates. Mr. Hall agreed that those are options and explained the depreciation of the system must be shown as an expense and it is increasing each year. Mr. Hall went on to say that we may make money but the depreciation cost is more than the profit and that difference is shown as a loss. Mr. Hall. said any extra revenue would be put into an interest bearing account to pay for improvements or reducing debt. Councilman Weaver said the city could build a new Senior Citizen Center. Mayor Pro-tem Harris said he would hope the money would be used to reduce debt and to improve the water and sewer services. There was a brief discussion regarding future expansion and mr. Hall said that we now have a 400,000 gallon buffer, noting that Stonebriar will have to provide elevated water storage of 750,000 gallons which will cover our needs. Mr. Langford said the city has been in the business 3 years, and done a good job, but we need to keep on the right track. 6. CONSIDERATION OF DISBURSEMENT OF DONATED FUNDS Councilman Weaver moved to follow the recommendation of the donor, Rick Pace, representing Wal-Mart and use $600.00 for the Senior Citizen program and $400.00 for repairs to the Civic Center and Councilman Alianell seconded the motion. Bill Hall said this is on the agenda because there was some disagreement and concern over how to spend the money and referred to his memo to the Council. Mr. Hall suggested the Council set a policy for disbursement of donated funds. Mayor Pro-rem Harris suggested that item be included on a work session agenda. The motion then carried with a unanimous roll call vote. 7. COUNCIL COMMITTEE REPORTS (OPTIONAL) Councilman Glazener said the "Keep The Colony Clean" committee has applied for a community based recycling grant of $14,000.00 and thanked staff for an excellent job in preparing that grant application. He said the "Chip in Program was just completed and had been successful. 003460 8. CITY MANAGER'S REPORT 1. Tommy Turner's father passed away on Saturday at the age of 91 from a stroke. The funeral will be in Be]Is, Texas at 2:00 p.m. on Tuesday, January 9, 1990. 2. Met with Mike russell, David Rolbiecki and Judy Talbot today regarding the Food Service Operator Certification Course, noting the initial investment for the course wi]! be $50.00 tuition. Mr. Hall said this is good for the city and will bring in approximately $6260.00 in revenues this year. 10. CLOSED DOOR SESSION AS AUTHORIZED BY ARTICLE 6252-17, V.A.C.S., SECTION 2G, REGARDING PERSONNEL, TO-WIT A. DEPARTMENTAL EVALUATIONS 11. CONSIDERATION OF ANY APPROPRIATE ACTION TO BE TAKEN AS A RESULT OF THE CLOSED DOOR SESSION Councilman Weaver moved to table the item listed in Closed door session and Councilman Aliane]] seconded the motion. Councilman Marks said this item is on the agenda each meeting and is of no use to us. Mayor Pro-rem Harris agreed, stating it needs to be struck if there is no reason to have it on the agenda. Councilman AIianel] said there are some items mentioned earlier that have not been addressed and that the Mayor should be here before this struck completely. The motion to table carried with a unanimous roll call vote. Councilman Marks moved to adjourn and Councilman Glazener seconded the motion which carried with all members voting Aye. Mayor Pro-rem Harris adjourned the meeting at 9:10 p.m. APPROVED: Don Ami'~?k, Mayor ATTEST: Patti A. Hicks, City Secretary [ SEAL ] DRAFT ATTACHMENT "^" CITY OF THE COLONY CITY BY THE LAKE · WATER AND WASTEWATER RATE STUDY JANUARY, 1990 City Officials Don Amick ' ' Mayor · Rick Harris Steve Olazener Councilmember Councilmember Place ! Place 4 Steve Withers Dick Weaver Councilmember Councilmember place 2 Place $ Mike Alianell Joel Marks Councilmember Councilmember Place 3 Place 6 William M. Hall City Manager Water and Wastewater Rate Study 1. Introduction The City of The Colony assumed Operation of the water and seWer systems on October 1, 1986 when The Colony Municipal Utility District No. 1 consolidated into the City. On August 11, 1987, the City of Eastvale was consolidated into the City of The Colony. The debts, liabilities, obligations and ownership of the properties and assets of both the Municipal Utility District and the City of Eastvale became a part of The Colony's Water and Sewer Department. The transition has been made, and the operations have been combined .and improved. The City decided that it is now necessary for a complete review of the rate structure. Bill Langford Associates was selected to do the water and sewer rate study. The study has been completed and is contained~ in this report. Adoption of the water and sewer rate ordinance will prOvide the City with a fair and user based set of rates which will insure financial stability and encourage conservation of water. The City does own and operate a water and wastewater system. The words "wastewater" and "sewer" are used on an interchangeable basis to highlight the pride the employees have in operating a clean and efficient City-owned utility. The system must be maintained to protect the safety and health of its citizens and the attitude of the staff is very important. It is also fundamental that the system be operated as a business or proprietorship. The City needs to continue towards a policy of putting the water and sewer system on a self- supporting basis which includes debt payments, depreciation, capital outlays and creation of adequate reserves. The difference in the public and private sector operations is that all fees collected will go back into the system or will be retained as surplus by the City to insure the financial stability of the water and sewer system. This study has been conducted with the goal of establishing fair and user based rates which validates the principle that costs should be recovered from those who .generate the costs. For example, business and commercial sewer customers have been paying $10.50 minimum for the first 2,000 gallons of water metered and $1.50 per 1,000 gallons of water used above the minimum. The residential customers have been paying a flat monthly charge of $11.50 regardless of water use. The proposed changes will correct the problem. In all cases in this study, a conservative approach has been used to estimate the revenues which will be generated by the recommended new rates and charges for the water and wastewater services provided by the City. The City should monitor conditions at least annually and a complete new study should be performed every three years or less if significant changes are being considered. As discussed in the workshop, the Texas Water Development Board (TWDB) requires user based rates to be in place before a city can obtain a Iow interest loan for improvements to the wastewater system. The TWDB also requires a water conservation plan. The main feature of any plan centers around water and sewer rates that discourage consumption. In fact, water resources are of large concern to a number of State agencies and continued economic development depends on adequate water supplies. 2. Planning The City is prepared for continued growth. The water supply is assured by a contract with Dallas for up to ten million gallons per day (HGD) available. Present use in The Colony is around two HGD. The City also has a back-up system with three operational wells. Expansion of the wastewater treatment plant appears to not be a factor at this time. However, planning will continue toward addressing the need for increased treatment capacity which is estimated to be about three years from now based on the present rate of growth. The City also continues to discuss and consider ways to finance wastewater service to the 246 water customers in the Eastvale area of The Colony not presently served by the sanitary sewer system of the City. Financial planning needs to continue for not only major improvements, but also for minor improvements such as cleaning and painting water storage tanks, servicing water wells and replacing pumps used in the utility system. As the system ages, depreciation will become a real factor. Operating, maintenance and replacement costs will increase. It is important to review the water and sewer rates on a regular basis so that financing can also be planned. The user ' based charge system, once established, can be continued as an equitable method of paying for future improvements to the water and wastewater utility. 3. Financial Analysis Table I contains a revenue and expenditure analysis for the last three fiscal years. 86-87 and 87-88 are from the audit reports prepared by Deloitte, Haskins and Sells. 88-89 figures are from the City's year-end financial reports. The last column on Table I contains the budget estimates for the current fiscal year which went into effect on October 1, 1989. Water revenues over the past 3 years have averaged $1,656,726 per year. However, in any given year, revenues will vary depending on the amount of rainfall which directly effects the amount of water consumption - particularly in the summer. Wastewater treatment service revenues increased from $915,525 in 1988 to $937,875 in 1989. This increase can be attributed to an increase iu new customers of the wastewater system at the flat rate of $11.50 per month. ' Total revenues for water and wastewater have Been pretty much the same on average for the last three years. On the expenditure side, operating and maintenance costs have averaged $2,208,112 per year over the past three years. A review of operating expense totals on Table i shows great consistency in holding down the cost of operating the water and wastewater system. It is important to note that operating income for the last two years totaled $1,003,520. However, transfers to the General Fund for the same period totaled $1,100,000 so there was a cash decline in the utility reserves. In the audit reports, depreciation is listed as an expense item. Each year depreciation has been more than $600,000 for a total loss in excess of 1.8 million dollars after the operating incomes were transferred to the General Fund over a three year period. Table 1 City of The Colony Water and Wastewater Rate Study Financial Analysis 1986-87 1987-88 1988-89 1989-90 Audit ludi~ Unaudited Budget Water'& Wastewater - ' ~perating Revenues Water'Service $1,566,528 $1,782,393 $1,621,257 $1,920,000 Wastewater Treatment Service 892,588 915,525 937,875 1,100,000 Service Charges 63,098 -0- -0- -O- Tap Connection Fees 48,966 -0- -0- -0- OCher 67 395 74 515 74~67~ 94 000 Total Operating Revenues $2,638,575 $2,772,433 $2,633,806 $3,114,000 ~pe~ati~.Ex~pen~e~ Administration $ 532,639 $ 456,779 $ 452,881 $ 504,880 Water Department 1,102,574 1,078,506 1,119,681 1,170,420 Wastewater Treatment 495,267 550,860 552,414 596,630 Haintenance 91 138 84 910 106 688 133 150 Total Operating Expenditures $2,221,618 $2,171,055 $2,231,664 $2,405,080 Op~rati~g Income $ 416 957 $ 601 378- $ 402,142 ~,, ~8~2~ * Excludes Depreciation, Transfers, Debt Service and Capital Outlay Depreciation $ 662,042 $ 686,179 NOT NOT AVAILABLE BUDGETED Reimbursement to General Fund -0- $ 550,000 $ 550,000 $ 600,000 (PROJECTED) A financial analysis of Table I reflects good stewardship of the system since it became part of the City in 1986. The analysis does indicate the need for action to maintain and operate this first class facility because to continue with the present rates will create even larger negative figures. Additional operating income will allow the City to establish reserves for depreciation. 4. Financing This water and sewer rate study shows the need for a period of adjustment. The City has owned and operated the system for a brief time. The transition has been made. The Colony wtll not have the $785,000 to transfer from the construction fund in the next budget to meet debt service requirements. It is estimated the City will have to generate approximately $1,100,000 in additional operating income each year. The financing should come from the customers of the utility. As to additional debt, the City should continue to work closely with its bond advisor, Hr. Boyd London of First Southwest. His assistance through this period of adjustment will insure a stable financial climate for The Colony. 5. Customer and Rate Analysts Dynamic growth occurred during Fiscal Year 1988-89 in the number of total bills sent to customers of the water system. In October, 1988, the City prepared 6,576 bills. In October, 1989, the City sent out a total of 6,865 which is an increase of 289 bills or 4.4~ on a percentage basis. Table 2 contains the analysis of water customers as to number, average use and average water bill. With continued growth, costs of the utility can be spread even more. Table 3 is an analysis of wastewater customers by number, revenue by month, average sewer btll for all customers and the flat rate for residential customers. The number of residential connections was computed by excluding the commercial accounts and subtracting 246 water customers not on the City's sewer system. An analysis of these two tables shows in September, 1989 a total of 6,844 water customers with 6,322 of these connected to the sanitary sewer system of The Colony. The average monthly water use on a year-round basis was 9.4 thousand when a!1 customers were included and 9 thousand a month average for residential water customers. As 96.79% of the water bills were residential, the commercial accounts are not a large factor in this study. The average residential water bill for 1989 was $20.50. Combined with the flat rate for sewer of $11.50, the average water and wastewater bill was $32.00 per month. Adoption of the proposed ordinance would' have the "average family" using 9,000 gallons per month paying $27.10 for water ($11.00 for 2,000 gallons and 7,000 gallons at $2.30) and $19.05 for sewer ($11.00 for 2,000 and 7,000 gallons at $1.15). The total average water and wastewater bill under the new rates for residential customers will be $46.15 per month. The increase per r Table 2 City of The Colony Water and Wastewater Rate Study Water Customer Analysis Residential Commercial Gallons AveraEe Used AveraEe Hont_..~h Bills Bills Billed ~in 1,00.0's- Water Bill October, 1988 6363 213 69,500,000 10.5 20.04 November, 1988 6406 216 50,442,000 7.6 18.39 December, 1988 6451 217 51,123,000 7.7 18.54 January, 1989 6455 218 47,413,000 7.1 17.75 February, 1989 6470 211 45,736,000 6.8 17.36 March, 1989 6460 210 39,855,000 6.0 16.13 April, 1989 6467 208 50,735,000 7.6 18.53 May, 1989 6550 215 64,427,000 9.5 21.00 June, 1989 6543 216 67,553,000 10 21.28 July, 1989 6572 218 81,364,000 12 23.61 August, 1989 6568 219 75,890,000 11 21.19 September~ 1989 6624 220 108,988,000 16 27.50 Fiscal Year 1988-89 TOTAL_.__...~S ~ 258__1 753,026,000 9.~4 20.11 Residential Only 77,929 est. 700,026,000 9 20.50 96.79% of the Water Bills were Residential Table 3 City of The Colony Water and Wastewater Rate Study Wastewater Customer Analysis Residential Connnercial Total Sewer Average Residential H~onth Bills~ Bills -- Bills Revenue Sewer Bill Flat Rate October, 1988 5904 213 6117 $76,747 $12.55 $11.50 l~ovember, 1988 5944 216 6160 75,882 12.32 11.50 December, 1988 5988 217 6205 77,931 12.56 11.50 `Tanuary, 1989 5991 218 6209 76,908 12.39 11.50 :February, 1989 6013 211 6224 77,996 12.53 11.50 Harch, 1989 6004 210 6214 76,914 12.38 11.50 April, 1989 6013 208 6221 77,954 12.53 11.50 Hay, 1989 6089 215 6304 78,616 12.47 11.50 .Tune, 1989 6081 216 6297 78,759 12.51 11.50 July, 1989 6108 218 6326 78,786 12.45 11.50 August, 1989 6103 219 6322 78,225 12.37 11.50 Se tember 1989 6158 220 6378 · P ..... ~ ....... ~ 13.07 ~1 ~. 5,0 Fiscal Year - 1988-89 Average Average TOTALS ~ ~ ~ ~ 12.5~1 1~1_.50 ~Less Commercial Accounts and 246 Water Customers not on the Cttyts Sewer System month per average family amounts to $14.15. The average water bill will increase $6.60 and the sewer increase will be $7.55 per month. Based on the number of water customers and the adoption of the proposed water rates, the monthly monthly increase in revenues will average $44,?80 for water. Based on the number of sewer customers and the new user based rates, the increase in sewer revenues will average $46,155 per month. Combined, the new rates will produce $90,935 a month or $1,091,220 a year in additional revenues for the water and wastewater system. 6. Comparative Rates Table 4 contains the water and sewer rates of The Colony and three other cities in the immediate area. It does indicate that the ones listed have higher rates than presently charged in your city. None of them have flat rates for any class of customers and, in particular, they have user based rates for residential sewer service. It can be helpful to consider what other communities charge for their water and wastewater treatment. However, The Colony has to make its own decisions as to rates in order to accomplish the goals and objectives adopted by the City. Adoption of the new rates will place The Colony's average water sewer bill below Glenn Heights at $5?.55, Flower Hound at $54.24, Seagoville at $48.60 and Wilmer at $47.90. The average bill in Duncanville, Cedar Hill, DCW¢ID No. 6 and Addison will be about the same as The Colonyts monthly charges. All of these cities purchase water from Dallas. Host of them will have to increase their rates over the next year or two in order to fund their local needs. Hore comparisons could be made, but the needs in The Colony must be addressed within your community. 7. Operating Income (Profit) Operating revenues are those received from providing water and wastewater service. For example, interest income is not an operating revenue. Operating expenses are funds spent in providing water and wastewater service. This excludes depreciation, transfers~ debt service, and capital outlay. The difference between operating revenues and operating expenses is defined as operating income or operating loss. - The operating income (profit) for 1986-87 was $416,957, for 1987-88 was $601,378 and for 1988-89 the City had an operating income of $402,142. In order to maintain the system and cover depreciation, as well as replacing reserves, the operating income will need to increase. The adoption of the proposed water and sewer rates by the City Council can accomplish these important financial goals. 8. Water and Sewer Rate Recommendations The basic principle used in computing water and sewer rates is that costs should be recovered from those who generate the costs. The present system of residential sewer rates is based on a flat amount of $11.50 per month per connection regardless of water consumption. The attached ordinance when Table 4 City of The Colony Water and Wastewater Rate Study Area Comparative Rates The Colony Wate.____Er Sewer Residential $10.00 Minimum (2,000 gallons) $11.50 Flat Rate $1.50 Per 1,000 gallons above minimum Commercial $10.50 Minimum (2,000 gallons) $10.50 Minimum (2,000 gal) $1.50 Per 1,000 gallons $1.50 Per 1,000 above above minimum minimum Lewisville Residential $11.55 Minimum (2,000 gallons) $4.44 Minimum (2,000) $1.83 Per 1,000 gallons $1.75 Per 1,000 above above minimum minimum based on Winter Average with no maximum Flower Mound* Residential. $14.62 Minimum (2,000 gallons) $9.92 Minimum (2,000 gal) $2.10 use between 2,000 - $2.48 Per 1,000 above & 15,000 gallons minimum based on Winter Average with no maximum Carrollton Residential $6.92 Minimum (2,000 gallons) $6.60 Minimum (2,000 gal) $2.67 use between 2,000 $1.38 Per 1,000 above & 50,000 gallons minimum based on Winter Average with no maximum * has seasonal rates adopted will change the City to a user based system and will spread the costs of financing the utility system fairly among all classes of users. In fact, a customer of the sewer system will pay .50 less per month in any month that metered water consumption is 2,000 gallons or less. The increase in sewer rates is going to apply to conservation aspects of the City's intent to do its part to preserve water supplies. In addition to conservation, user based sewer rates help to balance the costs of services between the water system and the wastewater system. The good news about complete user based rates is that all customers can control their individual bills by cutting consumption. The time to raise rates is during the winter months which gives the citizens of The Colony time to consider consumption when the summer months arrive. Conservation plans locally and for the State of Texas will be accomplished. For water, the proposed rate is a minimum of $11.00 for the first 2,000 gallons and $2.30 per thousand for all over 2,000 gallons. For sewer, residential customers will pay a minimum of $11.00 for the first 2,000 gallons and a $1.15 per thousand of actual metered water use above 2,000 gallons each month. Business and commercial customers of the wastewater system will pay a minimum of $11.00 for the first 2,000 gallons and $1.50 for each thousand above the minimum. Future industrial customers will pay a minimum of $16.50 plus 92.25 per thousand above the 2,000 gallon minimum. A surcharge will be added if the sewage being treated exceeds certain standards. All water and/or sewer customers outside the City limits will pay one and one half times the rates charged to customers inside the city limits. Adoption of the proposed rate structure will put the charges for the services on the user. As previously discussed in this report, specific financial situations needed to be addressed. The new rates are designed to meet those situations. If additional funds are raised above those needs, other priorities can be moved up for consideration or the Cityts reserves can be strengthened. It has been several years since rates were increased. Careful study and review has been completed, giving the City Council the basis for moving forward with these new rates and a new rate structure based on charges to the user. 9. Summary The City of The Colony took over the water and-sewer system on October 1, 1986. The transition has been made. Operations have been combined and improved. The purpose of this study was to review the present rate structure and to make recommendations for financing the water and sewer system. The adoption of the proposed water and sewer rates will accomplish this goal and will also complete putting the City on a user based charge system. The City has operated the water and sewer system over the past three years on a break even basis. However, depreciation has not been covered. Negative balances will continue to be reflected if changes are not implemented. It was discussed in this report that user based rates and water conservation planning are required if the City participates in the loan program of the Texas Water Development Board. Conservation of water resources is a high priority of several State agencies. Water and sewer rates that discourage consumption allow the city of The Colony to do its part in conservation and raise the revenues on a fair basis needed to maintain a quality water and wastewater system. It has been estimated that revenues need to increase by about $1,100,000 per year. Adoption of the proposed rates is designed to meet this need. It is also the appropriate time to make the changes (winter months). Besides continuing financial stability, the City will move closer .to having the utility become a business or proprietorship type system. DRAFT " AN OPJ)INANCE AN ORDINANCE PRESC~IBIN~ AND SETTIN~ USE~ RATES AND CttARGES FO~ SALES AND SERVICES OF THE ~ATER AND ~ASTE~ATER SYSTEH OF THE CITY OF THE COLONY~ TEXAS~ PRESCRIBING THE TIHE FOR PAYKENT OF ACCOUNTS AND PENALTIES FOR NON-PAYHENT$ SETTING DEPOSITS FOR UTILITIES$ REPEALING ORDINANCES~ RESOLUTIONS~ AND ORDERS IN CONFLICT HERE~ITHi PROVIDING A SAVINGS AND PENALTY CLAUSE. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF THE COLONY~ TEXAS~ SECTION I. The monthly rates and charges for the sales made of services rendered by the ~ater and ~aste~ater System of the City of The Colony~ Texas are hereby established~ levied~ set and prescribed as follo~s~ A. ~ATERRATES Honthly ~ater Use Rate per 1~000 Gallons Gallons Inside City Outside City First 2~000 $11.00 Hinimum $16.50 Hinimum All over 2~000 $2.30/1~000 gallons $3.45/1~000 gallons These rates are applicable to all sales or service of ~ater. All leakase between a meter and a building is the responsibility of the o~ner~ tenant or occupant of the building. Bo SE~ERRATES Honthly Se~er Rates~ (1) Residential customers - Honthly service charge ~ill be the ~iuimum plus the charge per thousand of actual metered ~ater use. First 2~000 gallons per month .......... $11.00 All excess of 2~000 sallons per month~ per 1~000---$1.15 Hlnimum charge $11.00 (2) Business and commercial - Honthly service charge to be based on the monthly metered ~ater usage~ First 2~000 gallons per month ...... $11.00 All excess of 2~000 ~allons per month~ per 1~000 gallons ............ $1.50 ~inimum charge ---$11.00 (3) Industrial Customers - Honthly service charge to be based on the monthly metered ~ater usage~ or estimated or metered monthly gallons of ~aste~ater discharged into the City's sanitary se~er system. A surcharge ~ill be computed by the City for the cost involved in treating sewage that has strengths ia excess of t~o hundred (200) milligrams per liter (BOD) and t~o hundred (200) mill/grams per liter (TSS). Honthly service charge (exclusive of any surcharges or other applicable charges)~ First 2,000 gallons per month, $16.50 Ail excess of 2,000 gallons per month per 1,000 gallons--- Hinimum charge $16.50 These rates apply to all customers inside the City Limits. Customers outside the city limits shall pay one and one-half times the sewer rate set for inside the City. Anyone receiving City Water service and connected to the City sewer must pay the above sewer charges regardless of whether the building is occupied or not. C. POLICIES AND PROCEDURES The City of The Colony will continue to follov administrative rules as established and followed in the past except vhere this rate ordinance makes changes or when changed or modified by the City. D. WATER AND SEIZER DEPOSITS There shall be a $35.00 rater and sewer deposit or equal surety acceptable to the City on each dwelling unit served by a 3/4 inch or 5/8 inch meter. The City will also .receive a $10.00 deposit for sanitation services from each customer. The deposits for existing commercial and multiple units not- separately metered shall be based on the last two months billing. For new commercial and new multiple units, the deposit shall be based on a similar business or a similar number of units. SECTION II. Bills viii be mailed between the 23rd and 25th of each month, depending ~on holidays and weekends. The payment is then due between the and 10th of the following month. The City will add a 10% (ten percent) penalty the day after the bill due date after all payments from the preceeding day are posted. A final notice will be mailed to customers with a previous balance of $25.00 or more on the same day the penalty is added. Delinquent accounts are disconnected between the 18th and 22nd if the arrears balance is over $25.00 and the total is $50.00 or more. The City will charge a disconnection fee of $20.00 each time service is terminated for non-payment. An additional $10.00 fee will be charged to restore water service after 5~00 pm on week-days or during the weekend. An additional charge of $20.00 will be added if anyone other than an authorized water department employee reinstates the service. It shall also be the policy of the City of The Colony that a customer must pay $15.00 for a returned check. The City retains the right to terminate water service immediately if the customer does not pay the account in full. SECTION III. Penalty~ Any person, firm or corporation who violates any provision of this ordinance shall be guilty of a misdemeanor and, upon conviction, shall be fined in an amount not exceeding one thousand dollars ($1,000). Each day on which a violation of or failure to comply with this ordinance continues shall constitute a separate violation and shall be punishable as such. The City also is entitled to pursue all other criminal and civil remedies to which it is entitled under the authority of other statutes or other ordinances. SECTION IV. Failure to Pay: In addition to sanctions provided for by this ordinance, the City is entitled to exercise sanctions provided for by the other ordinances of the City for failure to pay the bill for water and sanitary sewer service when due. SECTION V. Serverability: If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, such ihvalidity shall not affect other provisions or applications, and to this end the provisions of this ordinance are declared to be serverable. SECTION VI. All ordinances, resolutions, and orders heretofore passed~ adopted and made, or any part of the same~ affecting rates, charges and policies for sales made or services rendered by the water and sever system of the City of The Colony, Texas which are in conflict with this ordinance, shall be and the same are hereby in all things repealed. SECTION VII. This ordinance shall be effective February 1~ 1990. PASSED AND APPROVED ON THE 22nd DAY OF JANUARY, 1990 City o.f The Colony, Texas By Don Amick, Hayor ATTEST; Patti A. Hicks~ City Secretary _