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HomeMy WebLinkAboutPublic Comment Pnvc lofl Peter HolzNNeXster From: Ed Taylor Sent: Wednesday,July 05' 2OO68:39AM To: PoterHo|zmoioter Subject: FVV: Water costs From: Jacky Pou|sen [mailto:pouben@k*ecare.net] Sent: Tuesday, July O4, 2O069:09 &M To: EdTaylor Subject: Water costs Hello I am not sure you are the person I should be writing to, so if not, please forward this as necessary. We own a vacation home in Tahoe Donner. With the increases in water costs, I become more and more upset over the fact that we have to pay the same amount for our water as someone who lives in the area fulltime and has a full landscape! This is terribly unjust. Our place is used a few days a month and we have absolutely NO landscape whatsoever. I don't understand why/how you can charge someone in our position the same amount as someone who uses many times more water than wedo. I would sure appreciate a good explanation of how you can justify this philosophy of charging everyone the same. And better yet, I would appreciate it you would consider alternatives, such as (at a minimum)charging those with landscape higher rates than those without. That would be an easy thing to determine, and certainly greatly impacts water usage Many thanks for your consideration JackyPnu|son 7/5/70Oh e,_.M , . w u- Robert A. and Barbara S. Money 3404 Merrimac Drive San Jose, California 95117-3624 408-379-5944 June 14, 2006 Second home: 12860 Boca Street Truckee, California Board of Directors Truckee Donner Public Utility District P.U. Box 309 Truckee, California 96160-0309 Honorable members of the Board of Directors: My wife and I have owned our second home in the Biltz Tract since the early 1970's. We are extremely concerned about the high cost of water in your district and we understand that you are planning another raise in rates of 12% over the next two years. As second home owners we use relatively little water during our 3040 days a year that we stay in the house. We do not have a clothes washer, a dishwasher, or a garden and we pay the same flat rate of$50 per month as the full-time residents. This rate is about twice the monthly average of$26 that we pay in our primary home in San Jose where the weather is warmer and we use water for all of the above listed items as well as other in-home usage. In San Jose our water charge is based on the amount of water we use as measured by our water meter. As you know the number of second homes is far greater than the full- time occupied homes. We feel that it is very unfair that those who use very little water subsidize those who use a lot of water within our rate classification. We request that you have water meters installed on all properties in your district so that each of us may pay his/her fair share of the water that he/she actually uses. Please make the installation of water meters an item for discussion at the upcoming meeting and let us know the outcome of this meeting. Thank you, J /yh Dr. Robert A. Morrey and Barbara Morrey CRAIT CwMwWAueMondThduT9w July 5, 2006 The Honorable Ron Hemig President, Board of Directors Truckee Donner Public Utility District 11570 Donner Pass Road Truckee, CA 96161 RE: 6% Rate Increase and $27 Million Refinancing Package Dear President Hemig and Directors: The Contractors Association of Truckee Tahoe is a regional trade association representing 225 member companies across the spectrum of the building industry. Many of our members are construction customers and utility ratepayers of the District. The Executive Board appreciates the time Peter Holzmeister and Ed Taylor gave to meeting with us last Friday and answering our questions. I am also grateful for Peter's time with me on Monday July 3. The decisions before you appear to be the most significant considered by the District in recent years- not only in the amount of money to be borrowed but in the timeframe of debt service. Your decision will impact not only this generation of customers and ratepayers, but the next two generations as well. We are concerned that scheduling the hearing the day after a national holiday and with little advance publicity or information conveys the wrong impression. A fact sheet geared to the public was not available or distributed until June 30. Only one paid ad appeared in the Sierra Sun on Tuesday, June 26. PSAs on KTKE ran over the weekend, but that does not really give an interested party a lot of time to contact the District and receive information. This issue is too important to be rushed. This issue is too important to leave the public finding out later, after the fact. We know you will not be deciding this tonight. We request that you accept additional written or verbal public comment at the special meeting July 12 (or whatever alternate date is selected) and make your decision July 19. Ideally, Channel 6 viewers would be able to watch the proceedings on TV, but TV broadcast on July 12 and July 19 will be pre-empted by the Truckee Planning Commission. That is a problem. Please help the public grasp what you are doing by making it as simple as possible while increasing the timeframe for understanding the proposed changes. CATT truly understands and supports the intent expressed by District staff to improve and/or replace water delivery facilities. Several related points warrant mention: P.O.Box 10570 * Truckee CA 96162 o 530-550-9999 � fax 530-550-9998 a infoCa�ca-a.com We are troubled by the fact that no water reserve fund was in existence before 2006. We are troubled by the $0.00(ZERO) balance in the Facilities Fee account once the Brockway Pipeline project is completed later this year. We are troubled that no decrease in existing operations is being proposed as an alternative to fund the reserve. We are troubled that certain expenditures in the $27 million package (computer system and generators) will not last the lifetime of the long term 30 year debt. We are disappointed a list of street names with costs and timeframe has not been provided to explain the $12.3 million pipeline replacement project We would like to see such a list. These issues center around proper management and planning. As these last few months have proven, more information helps the public and decision makers get a better picture of what is to come. Approving the rate increases and$27 million package without fully understanding what is covered will create consequences that were not foreseen. In the past, it appeared projects and actions were not detailed enough for proper decisions to be made. We are encouraging you to raise the level of oversight you exercise as large spending proposals and projects are presented in the future. We did not oppose the creation of a water reserve fund earlier this year by increasing rates 2%. 'That provided about$154,000 in the new water capital reserve fund. We can support the 3%rate increase for the water capital reserve fund ($238,405 in 2007 and$252,709 in 2008). We cannot support the other 3% rate increase tied to operating costs. Our preference would be to finance the $27 million "need" in smaller pieces. Certainly a no- brainer for us is the refinancing of the 1996 COP—that can be done as a separate action if evaluation shows lower interest rates would be the result, otherwise it makes sense to fold this into another financing package. The advantage to a step by step approach is the process and pieces are easy to understand and can change based on changing circumstances. The disadvantage is that the cost to borrow may also go up (although interest rates have also gone down over time). Sometimes in the decisionmaking process, a decision needs to be based on what is acceptable to the public, even if it makes your job a little harder or costs a little more. This is one of those times. The$27 million package only includes one action with a multi-year lifespan—the$12.3 Million pipeline replacement project. The others: Donner Lake repayment, refinancing of the 1996 COP, purchase of new water system computers and generators, and the Brockway Road pipeline are essentially one time actions. This scenario has some similarity to the consumer"no-no"of buying a week's worth of groceries with a VISA card, although there are some differences. We believe current operations should not be funded with long term debt and hope you agree. The use of the Land Sales Trust Fund (LSTF) figures into this as the$1.5 million Donner Lake repayment is included in the$27 million package. A future meeting may be an appropriate time to discuss and clarify the policy for use of the LSTF. As used in this instance, the LSTF paid for the Donner Lake expenses of$1.5 million where the State monies were not sufficient for the Del Oro transition. The assessment charged the Donner Lake users was not sufficient either. We question whether the LSTF should have been used for this when it became clear that the$1.5 million was needed. Since the money is being borrowed now in conjunction with the new monthly surcharge, and both the surcharge and interest payment will take 30 years to pay off, we wonder why the LSTF should have been encumbered with this when the need for a long term solution was known before this year. Use of the LSTF added a new level of complexity to the Donner Lake picture. At the very least, some name change should be considered since the LSTF is intended to be an unrestricted, short term capital reserve fund. Because replacement of faulty pipelines is such a critical issue for all the District customers and taxpayers, we suggest the Board put in place an advance planning/review process to monitor the use of the $12.3 million for the Priority One pipelines over the four years expected to spend it. The full Board can do this or a subcommittee of the Board. This would be an annual effort separate from the annual budget discussion. The advance planning/review committee would insure all costs savings are considered (i.e.joint roadwork with the Town, sending out bids during the slow time of the year, studying engineering estimates and drawings to avoid overruns)and consequences known ahead of time. The advance planning/review committee is the guardian of the borrowed$12.3 million. Additionally, we think some discussion needs to occur in the near future about the Priority 2 and 3 pipeline needs. The Priority 1 replacement will be done in 2010. It will take six years, or until 2012, to accumulate $3 million in the Water Capital Reserve Fund(per Peter Holzmeister info 6/30/06). Is $3 million enough for Priority 2 and 3,or will we again be discussing some long term borrowing? Thank you for this opportunity to comment on such a significant issue. We look forward to your deliberation. Sinc,r y, Pat Davison Executive Director Summary of CATT Position on 6% Rate Increase Delay decision until July 19 to allow more time for public information and comment Support 3% increase for water capital reserve fund Oppose 3% increase for operating costs Consider reducing operating costs by 3% Summary of CATT Position on $27 Million Financin Package ackage Delay decision until July 19 to allow more time for public information and comment Break up the package into smaller pieces Review/clarify function of LSTF Would like a list of Priority One pipeline segments, by location,timeframe, and cost Want advance review/planning committee of Board to look at$12.3 million Priority One pipeline replacement Want advance discussion in next two years about Priority 2& 3 pipeline replacement funding source cur sV Ve 03:32p p.1 An1 T COWafts b lion Of TPOW Tam DATE: dune 30, 2006 — MEMO TO: Peter Holzmcister FROM. Pat Davison RE: Questions re Rate Inerea —ZPART2 Peter—THANKS for meeting with us. Just a few follow-up questions from this morning: 1. Does the 60/t rate increase require a 4/5 vote? Does the refinancing of the 1996 COP require a 4/5 vote? Does any part of the$27 million bond package require a 4/5 vote? 2. Please list the specific components of the $12.3 million replacement project by name/location, timeframe to be done, and cost 3. Does the $12.3 million for pipeline replacement include labor and materials? 4. Half of the 6%increase for 2007 and 2008 will go to operating costs ($491,114)- what are they—please be specific—how did you get that number? 5. Why isn't the Donner Lake S 1,497,272 to be paid back(assuming the $27M package is approved) going into the water capital reserve fund? 6• What is the interest being paid now on the 1996 COP? What would the interest be when refinanced as part of a bigger $27 million package? What would the interest be if you refinanced it as a stand alone debt? ro y Tim or GerP,131 July 3, 2006 �etK -M� zser Pat Davison Contractors Association of Truckee Tahoe P.O. Box 10570 Truckee, California 96162 Dear Pat, Here are responses to the recent set of questions you posed. Q: Does the six percent rate increase require a 4/5 vote? A: No. A majority is required Q: Does the refinancing of the 1996 COP require a 4/5 vote? A: No. a majority vote is required. Q: Does any part of the $27 million bond package require a 4/5 vote? A: No. A majority vote is required. Q: Please list the specific components of the $12.3 million replacement project by name/location, timeframe to be done and cost? A: Please refer to the attached maps. The Green identifies Priority i projects which are the projects included in the $12.3 million. These projects will be accomplished during the next four years. We do not yet have a perfect plan for which lines would be replaced in year one versus year two or three. The cost is approximately$200 per linear foot l included two other maps to complete the picture. The two additional maps show water lines on other streets that we can predict will need to be replaced based on our actual leak history. These two maps describe pipeline replacement that is beyond the scope of the $12.3 million. In order to be in a position to deal with these future projects we need to first get the worst of the leaking lines replaced and build a capital reserve fund set up so that over time we have cash to pay some of the cost of the future projects. This is the role of the Land Sale Trust Fund and the Water Capital Reserve Fund. Q: Does the $12.3 million for pipeline replacement include labor and materials? A: Yes. It includes all costs incurred by a contractor to perform the work. it also includes design, environmental review and inspection. Q: Half of the six percent increase in 2007 and 2008 will go to operating costs. What are they— please specify— how did you get that number? A: That number is an estimate of what the District's overall operating costs will increase. It is based on our estimate of the impact inflation will have on such costs as gasoline, pipe material, paving, insurance, labor and so on. The number is based on our historic experience. Q: Why isn't the Donner Lake $1,497,272 to be paid back going into the water capital reserve fund? A: In effect it is. The $1,497,272 will be used to restore the Land Sales Trust Fund, the fund it was borrowed from. That fund, in turn, is specifically earmarked by the Board of Directors to be used to advance money to capital projects on a temporary basis. The Land Sates Trust fund was set up to receive cash proceeds from the sale of surplus District land. When a capital project is undertaken the Land Sales Trust Fund advances the cash to get the project gong until long term financing can be secured. When long term financing is secured the Land Sales Trust Fund is restored so it can be used to assist other capital projects. Q: What is the interest being paid now on the 1996 COP? A: 5.5% Q: What would the interest be when refinanced as part of a bigger$27 million package? A: 4.52% based on current interest rate assumptions. As time goes by and interest rates increase, our estimate could increase. We could eventually get to a point where refinancing does not make sense. In that case we would not proceed with this component of the COP. Q: What would the interest rate be if you refinanced it as a stand alone debt? A: The interest rate would probably be the same 4.52%. However, the issuance costs would in that case be borne only by that smaller debt instrument which would increase the overall debt cost and might make refinancing impractical. Thanks for asking these questions. This kind of dialogue is most productive because it gets facts out on the table. The overall District water system picture is troublesome. There are physical problems that need to be resolved. That takes money. It cannot be ignored without damaging the community. These are matters that are unpleasant to talk about, but we need to do it. Very truly yours, Peter L. Holzmeister General Manager Jury,29 06 1251a p.1 C,Air Coo %ups AssOpi 1 of Tape DATE: June 29, 2006 MEMO TO: Peter Holzmeister FROM: Pat Davison RE: Questions re Rate Increase Hi Peter: This is the list of questions I posed to you and Ed yesterday and today I)- Where did the $27 million come from? --2)- What is the expected annual collection amount from the rate increase? 3) How will the rate increase and potential new monies from the refinancing be spent? 4) ; Why is this urgent? 5) What are alternatives to not passing the rate increase or going forward with the$27 million financing package? 6) What is the relationship of the rate increase/refinancing to future water hookups? We'll see you tomorrow morning here at 8 AM. THANKS! Where does the$27 million come from? Brockway Road pipeline $ 4,000,000 TD Pipeline Replacement $12,30p 000 Generators 180,000 SCADA 400,000 1,4 Donner Lake reconstruction 97272 Refund 1996 COP ,497,272 TOTAL $26,842,282 What does the rate increase raise per year? Current rate revenue $7,946,829 Six percent increase in 2007 raises an additional $476,810 (Total of$8,423,639) Six percent increase in 2008 raises an additional $505,418 (Total of$8,929,057) Total increase after two years is $982,228 One half goes to increases in operating costs Other one half goes to establishing an operating reserve ($491,114) Operating reserve goal is $3,000,000 (about 175 days of operating expenses) Takes six years to build reserve of $3,000,000 How is the new money spent? One-half ($491,114) supports operating costs, which are increasing One-half ($491,114) goes to the water general fund to build a cash balance of $3,000,000 over six years ALTERNATIVES: 1)Pay as You Cro(Board Member suggestion) Cash-finance—no new debt Estimate$3 M per year Would be 40%rate increase or$20 per mouth for 4 year Would only replace priority#1 pipelines, one third of the problem 2)Do Nothing No new debt Small pipeline replacement projects after two years Repair vs. Replacement Rate increases for additional repair cost 3)Proposed(financing package)-AKA-Long Tenn Financial Solution Issue COP's and rate increase Addresses both short term and long tern funding for system replacement Builds reserve fund Provides short term funding for new water system facilities 07/0512026 01: 27 5305877045 GLENSHIRE PAGE 01 j 7GLENSHIRE DEVONSHIRE i R E 5 2 p R N T 5 A S S O C I A T I O N 15726 GLENSHIRE DR TRUCKEE, CA 96161 FAX TRANSMITTAL I Date: S O To: � Number of pages:_ _— Fax #: ��� �59 (including this one) , From: 5 I. — i I Re: 4 t r 1(1 1� J `��,\ C TELEPHONPl59n5 Saztom t,-„�......___..._ 07/05/2026 01: 27 5305877045 GLENSHIRE PAGE 02 GLENSHIRE DEVONSHIRE R 6 S 1 D 6 N T S A S S O C A A T t O N 15726 GLENSHIRE DR TRUCKEE, CA 96161 ------------------------------------------ Date: July 5, 2006 Memo To- Peter Holzmeister& Board of Directors From: Glenshire/Devonshire Residents Association Re: Rate increase and Debt questions i Dear Peter & Board of Directors, Please accept the following comments regarding: a) Adoption of an ordinance increasing the District's water rates. b) Adoption of an ordinance establishing a billing surcharge applicable to Donner Lake customers. c) Increasing the District Debt. We are very concerned about the speed in which these decisions are being made without specifics being made available for public review. The proposed increases being suggested are on the heels of the increases in 2006 budget. The discussion for that rate increase was more thorough and the public reach-out was significantly better. We have followed your discussions and have some specific questions that have not been clearly answered by the board or staff: • Does the District need a super majority vote of the board to secure another bond? • Is the 12 million dollar loan for a speck pipe replacement project or a comprehensive repair program? • Is the 6% operating budget increase for 2007 & 2008 an increase only to get the loan? Can the board raise the rates again for operating expenses during the next budget cycles? • Is the Donner Lake surcharge being handled the same way the Glenshire surcharge was developed? • Why isn't the approximate $1.5 million from the Donner Lake project being retumed to the capital reserve fund? TELEPHONE(530)587-6202 FAX(530)587-7045 i 07/05/2026 01:27 5305B77045 GLENSHIRE PAGE 03 If you include the intention of the District to move forward with the broadband project the district debt will be over $60 million dollars. There are too many issues that have not been adequately presented to the public. Moreover, the speed in which the board is moving is not allowing enough time for us review the information. Our next board meeting is July 12, the same night you have planned to vote. Our Association would like to discuss the districts proposal and plans. We are requesting you continue this discussion until our board has had the opportunity to review the answers to the questions we have submitted. Thank you for your consideration. Glenshire/Devonshire Residents Association