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09-18-2014_CIACCity of LOS CrUCOS OD FEIFLE NELFING FEB PLE Capital Improvements Advisory Committee Minutes for the Meeting on Thursday, September 18, 2014 1:30 p.m. Utilities Center Conference Room 218 Committee Members Present: Lonnie Hamilton, Chair Ronald Johnson, Committee Member Chrys Uhlig, Committee Member Committee Members Absent: Eugene Suttmiller, Vice -Chair Max Bower, Committee Member City Staff Present: Travis Brown, Fire Chief Carl Clark, Interim RESITS Administrator Jorge Garcia, Utilities Director Carol McCall, Community Development Planner Jessica Phillips, Utilities Office Assistant Sr. Loretta M. Reyes, Public Works Director Alma Ruiz, Utilities Office Manager Senior Adrienne Widmer, Water Resources Administrator Chair Hamilton called the meeting to order at approximately 1:33 p.m. 1. Acceptance of the Asaenda Chair Hamilton asked for acceptance of the Agenda. Johnson motioned to accept the agenda. Seconded by Uhlig. All in favor. The motion passed. The Agenda was Accepted Unanimously. 3-0 2. Acceptance of the Minutes Regular Meeting of August 21, 2014. Chair Hamilton then asked if anyone had any problems with the minutes as read. If not, he would like to entertain a motion. Johnson motioned to accept the amended minutes. Seconded by Uhlig. All in favor. The motion carried. The August 21, 2014 Meeting Minutes were Approved Unanimously. 3-0 Page 1 of 14 Capital Improvements Advisory Committee Page 2 of 14 Regular Meeting Minutes for September 18, 2014 3. New Business No new business. 4. Old Business Utilities Department Projects Update: Carl Clark, Interim Administrator for RESTS, presented on the first part of the Utilities Department Projects Update. Clark informed the CIAC Members that the first projects he'll cover were completed over that last several years and a majority of them used Impact Fees and Development Funds. The first project is the Jacob Hands Wastewater Treatment Facility Enhancement Works, the cost is approximately $3 million. It was completed in the year 2007. Basically the outdated entrance works were replaced; capacity size, and an ease of operation were increased. They installed new screens and basically what happens with the entrance work is all the grit and trash gets removed from the sewer influent. The new entrance works were expanded to handle up to 13 millions of gallons per day (MGD) of influent. Chair Hamilton stated he had not been on a tour since that had been completed. Clark commented a tour can be scheduled if the CIAC Members are interested. Clark goes on to speak about the next project, which is the Jacob Hands Wastewater Treatment Facilities Equalization Basin Project. This project cost about nearly $13 million. A combination of funds were used, Impact Fees and 2006 Bonds. The project was completed in 2008 with the advantage of this being sustained capacity beyond 2025 and with ease of operation increased. This took out the peak flows so that they can handle peak flows easier at the Treatment Plant. Basically there are four new equalization basin cells that were constructed. Each with the capacity to hold about 800,000 gallons each. Johnson stated, that although he knew where they were located, it would not hurt to have the address somewhere on the presentation. Clark asked if he was referring to the Jacob Hands Wastewater Treatment Facility. All of them, Johnson replied. He stated, that they knew where they are, but it would not hurt for that information to be added. Clark agreed to add the information as requested. The next project was the Jacob Hands Wastewater Treatment Facilities Screw Pump Conversion, with a project cost of approximately $2 million, was paid with Impact Fees and Rates, and completed in 2009. The advantage was sustained capacity beyond 2025 and ease of operation. The project consisted of the removal of the old Archimedes screws, which were replaced with new submersible pumps capable of moving 13 MGD of influent. As part of the project an odor control biofilter system was installed to aid in the removal of the Hydrogen sulfide gasses that create the odors at the facility. Uhlig asked if they were using the regular loop pumps or a better than screw pumps or is it a toss-up. Capital Improvements Advisory Committee Page 3 of 14 Regular Meeting Minutes for September 18, 2014 Clark replied he believes that the archimedes screws are a lot more efficient but that caused a huge odor control problem because of the old ones. The current pumps work very well, they don't have any issues with those whatsoever. The next project Clark reviewed was the East Mesa Water Reclamation Project, with a cost of $12.5 million. This did use up Impact Fees, EGRT monies came from there, various Grants, and NMFA Loans and Bonds were used to pay for the facility. This project was completed in 2009. Ability to reuse up to 1 MGD at this facility, which allows less potable water to be used for irrigation purposes. Currently they have Veterans Park, Sagecrest Park, Sonoma Ranch Golf Course, and the Armed Corp Restoration project utilizing reclaimed water at this time. With the other entities coming online shortly. Foothills Landfill will be online shortly for dust suppression and the new Centennial High School will be utilizing the reclaimed water for its sports fields and landscape. Johnson asked if this was the type of water used for irrigation. Clark confirmed, stating that they were using reclaimed water in parks now and that Sonoma Ranch golf course is using the reclaimed water as well to irrigate. Next Clark presented the University Lift Station Rehabilitation. The project cost for this was approximately $1.4 million. Impact Fees and Rates were used to pay for this. The advantage of this was increased capacity and basically a rehabilitation of the lift station. It was completed in 2009. The project consisted of the removal of the old lift station, construction of the new larger wet well, larger lift pumps, new building, generators, and biofilter system. Clark pointed out, that Adrienne Widmer would be able to tell them exactly where it was located. Widmer provided verbal directions and stated it is actually on NMSU (New Mexico State University) property. Discussion was held. Next was the South Jornada Water System Improvements. This is a large project, which will be completed in two phases, the cost is approximately $10.5 million. Impact Fees, 2005 Bonds, and a 2007 NMFA Loan were used to pay for this project. It was completed in 2010. The benefits for this was sustained capacity beyond 2025 and system redundancy. As stated, the project was completed in two phases; Phase I was a new booster station at the Missouri Tank and a 24" Transmission Line to the Telshor tank; Phase II included a new booster station at the Telshor Tank along with a 24" Transmission Line to our South Jornada Tank and a new booster station. Johnson asked how much the loan was and for how long. Clark deferred the question to Dr. Garcia. Dr. Garcia stated, that this was part of the whole bond issuance. Individual loans were not issued for projects. There were several million dollars' worth for all the CIP. Johnson asked when it has to be paid off by. Dr. Garcia mentioned that some of them are in 2021, some in 2026, there are different series of bonds, but they were mostly water and wastewater, utility revenue bonds. He offered to provide citation on the report because the tables are the same as what's on the report. Capital Improvements Advisory Committee Page 4 of 14 Regular Meeting Minutes for September 18, 2014 Clark goes on presenting the next project, which was the West Mesa Waterline Project, this had an approximate project cost of $1.4 million. Funds for the project were provided by Impact Fees, an EPA Grant, and 2005 Bonds and Rates. The project was completed in 2011. This project consisted of the installation of a 36" waterline from South Fair Acres Road to Well 46. This project connects our West Mesa Well Fields leading into the City system in the lower Valley. This will increase the system capacity. Hamilton asked if this was La Mancha, which Clark confirms. Johnson asked what that was. Discussion followed. The next project was the Griggs Walnut Groundwater Plume. They utilized EGRT, NMFA Loan, and SAP Grant monies for this project, which cost about $3.3 million. Impact fees were not used for this project but this is a significant project for the City of Las Cruces and that is why it is included in the presentation. The Super Fund was completed in 2012 and is this project is an ongoing effort in the remediation of perch loroethylene (PCE) in the groundwater around Griggs and Walnut Drive. The project consisted of a new building that houses air strippers that are used to remove PCE from the water in the Griggs/Walnut areas. Hamilton asked about the recent event that took place at this site. Clark confirmed that the 2nd Anniversary was held on September 4th at the Superfund Site. Discussion followed. Next was the Jornada Tank Complete Rehabilitation and Mural. The project cost about $904,000.00. The funding came from NMFA Loans. This project was completed in 2013. This project consisted of a complete rehab of the interior, which is a 2 MGD tank, which included replacement of the steel floor and complete rehab of the interior. The exterior was waxed, power washed, and then Artist, Tony Pennock, was brought in to paint the exterior's new mural; he has all the tanks. Hamilton commented, that he does a really nice job. Discussion followed. Johnson asked what the funding was on the Griggs and Walnut project. Clark said it was a NMFA Loan and SAP Grant monies. Clark goes on to talk about the West Mesa Water Phase IV — Project 2, a continuation of the project that they talked about earlier here. That consists of the installation of a 36" waterline from Well 46 to Well 63; as shown on the map. It includes a bore across 1-10 (Interstate 10) that now allows delivery of potable water to the Kennon Annexation via a 12" water main. That project cost approximately $1.4 million, with a combination of Impact Fees, EPA Grants money, and 2005 Bonds and Rates to pay for that. Clark announced that, that concludes the past funded projects and next he presented on projects that are planned for now. The first project is the La Mancha Waterline project, with an estimated cost of about $146,000.00. Construction funding for this project comes from a voluntary assessment that is being done with the residents in that subdivision. Each property owner is going to pay approximately $2,300.00, if the construction costs come out exactly to what they are estimating. Capital Improvements Advisory Committee Page 5 of 14 Regular Meeting Minutes for September 18, 2014 Hamilton verified that it was $2,300.00. Clark confirmed and stated, that was for construction and that there would be Impact Fees on top of that as well. Hamilton asked what the connection fees would be. Clark did not know off the top of his head and asked Widmer. She replied that there were the typical Impact Fees, Hamilton interjected that he understood, it was the usual. Dr. Garcia mentioned, that for this job, Utilities was going to do line extensions, so the per unit cost of extending the service line may not necessarily be there. He believed the project already delivers meters and that was confirmed by Clark. Hamilton said he assumed the project was not yet complete at this time and asked if these people were currently all on water wells. Dr. Garcia explained, that this was a pay -out subdivision that they need to complete, because they have problems. They already have City water. When the developer stopped working on the subdivision they left a loop that was removed. To fully meet City standards we ceased issuing permits for any further development when they stopped making improvements. So the new owners agreed, the Board approved, and Utilities agreed to do an assessment; and that Utilities will go do the improvements that the developer should have done, to meet the City's standards. Even though, it is not part of the agreement, to fit Utilities service it has to be City standard. Clark mentioned that there will be an installation of a 12" and 8" waterline. Hamilton asked if they were thinking of annexation at one point and if they plan to lay this into County or just provide services. Dr. Garcia stated, that the County could annex it if they wanted to, because the hill west of it is already added; this part is not. They still need to meet City standards. Hamilton mentioned, that this raises another question: looking to the West, there is an area that has been graded. Dr. Garcia said it was not the pipeline. Hamilton goes on to say, that this is the pipeline. Dr. Garcia explains that there used to be access to another subdivision. Discussion was held. Dr. Garcia also commented that when they agreed to do this the Board did what is called a voluntary assessment, where they divided cost of this improvement by the number of remaining open lots. Johnson verified that it was by the lot, not the square footage. Dr. Garcia stated, that it was by the connection. They are all % inches. Clark goes on to say that the map displayed shows the portion that will be constructing as part of this project, which is a 12" waterline and an 8" waterline. Discussion was held. Uhlig asked about the Calle del Norte if it ends there for proposed or just in front of it. Does that continue on? Dr. Garcia confirms that it does, and goes up. Uhlig asked if it is connected to something. Dr. Garcia stated that it goes all the way to Picacho Avenue, and that is where it crosses the river, on Picacho Avenue. He goes on to ask Clark to explain the ultimate plan, to bring the 36" across the river, but that there is no funding for that, that there is no need, or capacity, but eventually, a line will need to go straight across. Clark elaborates by stating, that the ultimate goal is to bring a 36" or 24" line across the river. Hamilton asked if that would be above ground or below. Clark said it would be below ground. Because of funding issues it's too huge a job to cross the river if allowed to do it. Johnson commented that there is a lot of capacity to bring into there. Clark confirms, that there is a huge well fill out there that they do benefit from. Dr. Garcia adds on that they have an 8000 acre feet approved on the West Mesa. So a lot of the future capacity for the City will come across from there. Capital Improvements Advisory Committee Page 6 of 14 Regular Meeting Minutes for September 18, 2014 Johnson agreed that this is what they need to do. Uhlig asked, so would you just bury it across the Rio Grande. Clark replies more than likely they would case it or bore it and case it across the Rio Grande somehow. Uhlig mentions, that 36" is tough to pull out of a casing. Dr. Garcia said, that they have preliminary plans. At one time we were going to put two across the river. For redundancy reasons because if you had to repair, you had to do it on the off-season so you need two lines bifurcate across the river. That was the plan at one time. They had a draft plans for that from Molzen Corbin. There is a preliminary design. Widmer commented that she actually did the plan, while she was in the private sector. Discussion followed. Clark goes on to present on the next project, which is the Zone 1 Interconnect Phase B project. Currently they have a budget of approximately $1.6 million for this project. The total estimated build -out cost for this project is $4.2 million. They are short on funds, so they have chosen to phase this project out into three phases. The project consists of installation of a 24" DI waterline from Jornada tank to Highway 70. The Phase I of this project would go from the Jornada Storage Tank up to what will be the future Mesa Grande Drive. Phase II would be the North end of the transmission line, crossing Highway 70. And Phase III is the middle portion of 24" DI waterline. This will allow for a direct link between North Zone 1 and South Zone 1. Hamilton interjected and asked, if the High School was right at that intersection where they will be crossing. Clark points out a section on the screen and says yes, he believes this is where the High School is located. Hamilton mentions that he was just trying to get his bearings. Clark points out where Mesa Grande is on the screen. Hamilton says that this road is most likely in the long future. Clark confirms this. Hamilton verifies that right now the only through street across here is Sonoma and they are east of that. Again Clark confirms. Clark goes on to say, that currently this is in their development fund, that they have the budget tied up in. They have a design for this and as mentioned are looking at kind of phasing this out. They believe they have the majority of the right-of-way (ROW), except for that crossing. That would be the only location they need to get the ROW. They are talking with the property owner at this time. He is interested in a piece of property that they want to back and Utilities is interested in an easement from him in this location. Hamilton says that they seem to expect this to happen pretty quickly, and asks by when, possibly by 2015? Clark confirms. Discussion followed. Dr. Garcia explains the reason this project is too expensive, is because they would have to build a road, grade wise, to put the pipeline. So they will wait until there is need, and Public Works and Transportation decide that a new corridor is needed. At that point they will put the line. Until such time, they need to do a realignment on the South -end because they would be relinquishing an easement and that they would have to realign the pipeline where the road should be; because there is going to be development where a piece of the pipeline is right Capital Improvements Advisory Committee Page 7 of 14 Regular Meeting Minutes for September 18, 2014 now. And then on the North, they already have a pipeline arriving on the Northside of Highway 70 with water from the well fields they have on the East Mesa. So they can bring capacity from both ends. But the main link, which is not needed at this time capacity wise, will be to cross from the High School down to the South, and that is a major pipeline, a major alignment, both vertical and horizontal that needs to be addressed. Clark goes on to say, there is no road right now, it is nothing but desert. Hamilton mentioned that this is what he had thought. Discussion followed. Johnson stated in like 2014/2015 what is being supposed to be built. Clark responded, that would be the first phase they are hoping to move forward with the first phase and tie that waterline in. There is an existing waterline they would tie into, that goes through the Zone 1. Hamilton asked if that was the dotted line along the bottom on the presentation, which Clark confirmed. Johnson asked what the source of funds was for this project. Clark answered that both were Water Development Funds that they have been looking at. Dr. Garcia adds that they are part of the Bonds that we're paying on right now. Clark reminded the Committee that this was a 24" DI waterline. Johnson asked if it is currently an 18" and if that will remain? Clark continued by stating that the 18" to the East will remain, they will be replacing the existing 18" line that comes from the tank. Clark goes on to present on the next project, which is the Water Supply Wells 29, 31, 32 Replacement and GW (Griggs Walnut) Monitoring Well Construction Project. This is funded by the Governor with approximately $2 million. That will all be grant money, to replace the existing wells, and to install a new monitoring framed well. The project consists of drilling, replacing the wells at various locations as well as a monitoring well at the Griggs Walnut site. He goes on to say, that he also provided pictures of the well sites themselves. Well 29 is not currently being utilized, as they have had issues with the casing. Johnson had questions behind the reasoning for the Governors funding of this project. Dr. Garcia explained the process of sending out proposals in further detail. He mentioned that the Governor herself pushed for this project. Of the monies she got $2 million came to this project. On the water side, they got $2.25 million for Wastewater. Although the money is coming from the Governor, the Engineering is being paid from rates — by our own funds. The Engineering, or in this case, Hydrogeology in the contract documents for drilling, were paid by Utilities. Clark also added, that the Governor did come down here for that project. Clark mentions that $2 million warrants a visit from the Governor. Clark goes on to say that Well 31 is not being utilized at this time, as they have been having some screening issues with it. Well 32 is currently being used, but at limited capacity. The next project on file is the Shadow Run Force Main Rehabilitation project. Approximated amount for this project is $235,000.00 that is being paid for by rates. Hamilton interjected, asking if Well 29 was up and running at capacity. Clark answered, no, that would be Well 32, and it is at half capacity; while Wells 29 and 31 are not being utilized. Hamilton acknowledged this. Capital Improvements Advisory Committee Page 8 of 14 Regular Meeting Minutes for September 18, 2014 Uhlig asks Clark how deep these wells are. Clark answers that those are around 400 to 500 feet (ft.). At the new drilling they will be going a little deeper. Around 600 ft., where they hope to get a little better water. Hamilton asked how deep the aquifer was. Clark referred him to the expert referring to Dr. Garcia. Dr. Garcia stated, that it depends. He said that you can drill up to a 1,000 ft. down, for fresh water. He goes on to say, that the aquifer is pretty deep, almost 2,000 ft., but the water gets salty. Hamilton comments, that they have to keep skimming the top, instead of going deeper down. He asked if they keep skimming, will the salt dissipate down farther. Dr. Garcia answers that it is an aquifer that is stratified, the bottom parts of the aquifer have higher salt and then the upper part is fresher. Hamilton verifies that because it is stratified it create a barrier so nothing leaks in. Dr. Garcia confirms, and goes on to say, that they will be going a little deeper, to get additional water, because there have been drops in water table because of the drought, so in order to allow enough drop and get good capacity, one needs to have a deep enough well. Hamilton inquires if the outlook for water in this area is still good, and was curious about the timelines. Dr. Garcia answers that saying, that there have been drops in the water table. We are looking at anywhere from 2 Y2 to 3 ft. a year for the last ten years. So it has been dropping that much. The water table on some of these wells was 30-40 ft. and now they are about 80 ft. down from the surface. So there have been drops, but the bigger concern is, if we continue to mind the aquifer, were going to have to tap into deeper water, meaning the quality is not going to be as good, we including the farmers, we are going to have to tap into deeper water and the quality will not be the same, which means it will have to be treated. One does not want to treat it if one can just get it to drink it. So if something changes, it is going to be the quality. Hamilton interjected, that there is plenty of water to sustain. Dr. Garcia confirmed and repeated, that the quality is where change can be seen. Hamilton interjected, and hopes that we can get out of drought conditions. Dr. Garcia said you would think so, there is enough data to show, that the one in the 50s is similar to this period. The draught started in 2003-2004. They started getting less and less rain, and less recharging of the river. Irrigation in the river is what recharges the aquifer here. Discussion continued. Dr. Garcia goes on to explain the current water litigation issues with Texas, New Mexico, and Mexico. Discussion followed. Uhlig had another question for Clark, he wanted to verify where the casing would run. And he asks if it is through the well. Clark says yes, and they will build down to around 650 ft. for the total well. Then a screen would go up 50-60 ft., maybe more, and then the casing will take off from there. Dr. Garcia adds that then they would put some surface casing on the top, to retain the initial drilling you put a bigger casing first and then drill from there. Discussion followed. Clark goes on to present on the Shadow Run Force Main Rehabilitation project. The budgeted amount for this project was $235,000.00, and funding comes from Rates, and this project is a carryover from last FY. It consists of the installation and replacement of an existing 3" sewer force main with a 4" force main with some minor work within the lift station itself. This is currently under design but by Bohannan (BHI) in Huston, but hopefully the design will return to them by the end of FY15 and can then go to construction shortly thereafter. Capital Improvements Advisory Committee Page 9 of 14 Regular Meeting Minutes for September 18, 2014 Hamilton has a follow-up question about Shadow Run Force Main Rehabilitation. He asked if Shadow Run runs through an old subdivision. Clark states that it is the first subdivision off of Las Alturas. Hamilton tries to verify, that this is just a rehab project. Clark confirms this, and goes on to say, that they took over that system many years back, but is not sure exactly when, probably in the 1990's. Dr. Garcia also believes, that it was in the 1990's. He goes on to say, that this used to be an Association, when the City still allowed User Associations. When the original owners sold homes they came to the City Council and said, can you take it over and maintain it? They already had permission to connect to the City's because they were inside City limits, but it was not designed to City standards. He believes this is the last Association the City accepted. Since nothing was up to City Standards they had to redo things, like run electric service and put City standard pumps, and now it is time to rehab the force main. Discussion was held. Johnson asked if the City gets any payment for taking over. Dr. Garcia said yes, and that there was an assessment for about 15-17 years proposed amount from each customer. When they got close the payout the Council rescinded the assessment. It was $6.20. Johnson asks if this is now being paid by Rates. Dr. Garcia confirms, and said once the assessment was eliminated and they officially came under City ownership, they said they could replace the force main later. Discussion about Associations and City standards followed. The next project was the Sandhill Wastewater Interceptor, which is paid for with Impact Fees. It is a carryover from FY14 and this project is phased out. Phase I has a budgeted amount of $1.5 million in Wastewater (WW) Development (impact Fees). Budget for Phase II is $1.2 million using (WW) Development. The project consisted of an installation of a 15" sewer inceptor parallel to the existing line. Right now they are still negotiating with private property owner for ROW. Clark said that there will be a bore across 1-25. Hamilton verifies that they are working with a private owner, which Clark confirms, and that they are currently working on trying to install these lines, so they are working with the property owner and the developer to get the ROW or the easement that they need. Hamilton asked if that was on the Eastside, which Clark confirms, and adds that it is East side of 1-25, North of Highway 70. Discussion followed. Clark goes on to the Sewer Interceptor 236 project, which is also paid with Impact Fees. Estimated cost is $295,000.00 (WW Development Fund). This project is currently in design. This project is the extension of the existing 18" sewer interceptor with a 15" interceptor. The waterline will allow access to the sewer from development to the East of Pagosa Hills Avenue, which they have indicated they are ready to go on that. Project is designed and currently awaiting BLM (Bureau of Land Management) to issue a permit for that project and hope to see that in the next month. They are pushing them on a weekly basis, to get that permit. Hamilton had a question about the location. Discussion followed. Clark moves forward with the Plan, Design and Construct Sewer Systems High -Priority Areas project. This is another one of those septic replacement projects. The estimated cost on this one is $451,000.00, with $321,000.00 of that coming from Legislative Grant funds and the other $130,000.00 coming from LCU funds or EGRT funds. The project is to install sewer Capital Improvements Advisory Committee Page 10 of 14 Regular Meeting Minutes for September 18, 2014 mains in the Powers Drive and Walls Avenue areas that currently have septic systems. They are at the final process of meeting any of the construction bureau program requirements, and now they can move forward getting this out. Hamilton has questions about the location, which were addressed by Clark and Johnson. Next was the Plan Design and Construct Sewer Systems High -Priority Water Well Projects, which is another one of the projects funded by the Governor. Estimated budget is $2.25 million. Currently the majority of the designs are done for all the various locations, with the exception of one, which they are working on. With this project they are still waiting for the Governor, or rather the State to notify them, that they have sold their Bonds and to move forward with the paperwork to accept the money. The big thing here is Lantana Phase II, which Lantana Phase I was originally completed about two years ago. The remainder of the phases are getting wrapped up in this project here, which there were 4 Phases, and they are going to be calling it Phase II going forward, which encompasses Phases II, III and IV. The next project is the JHWWTP (Jacob Hands Wastewater Treatment Plant) Co - Generation Project. The budgeted amount for this one is $2.9 million, and this project is currently in design and they hope to be acquiring engine generators for this project this FY, but construction and installment will probably not happen until FY16. They are replacing the antiquated co -generation (co-gen) engine generator system that they currently have in the plant right now. They will be installing two engine generators, running one generator all the time, providing the majority of power to the plant. They will be using Methane gas and Natural gas as well. Hamilton mentioned that when they took their tour, that was one of the discussion items, where they talked about making it a little more efficient. Clark agrees more efficient and newer. The next project is the JHWWTP Odor Control Improvements project. This is sort of the pre -project to others, and this one covers the Mix Box Cover, the project is currently under construction and they are hoping to be completed with it by October. What they did was install covers on top of the Mix Box Covers, along with a bio-filteration system that pulls the gases out of there, and then through the bio-filter. Funding for this project comes from Rates Uhlig had a follow-up question about the JHWWTP Co -Gen Project, asking if they had power at the plant via El Paso Electric. Clark confirms that El Paso Electric is the current power source, the engine generator is only used during a power failure. With the new system they hope to be providing the majority of the power with the engine generator, if they ever need to, and El Paso Electric asked us, they can drop their power and run both generators and supply all the power to the plant. Dr. Garcia added, that as part as Co -Gen, you can harness the heat, and use the heat of the anaerobic portion of treatment, so they can save energy by doing that and using biogas. They only have biogas for 50% of the plant, so they will run biogas, natural gas, and harness some of the heat, and its full Co -Gen process. But they would still of course have El Paso Electric, because in order to totally get away from them, they would have to run three engines, and they currently do only have money for two engines at this point. They are going to do the base molding and then they are going to use the rest from El Paso Electric. Uhlig commented that he missed the tour of this site. Dr. Garcia offered the committee Capital Improvements Advisory Committee Page 11 of 14 Regular Meeting Minutes for September 18, 2014 a tour if they have not yet had one. Uhlig asked Johnson if he had been, he confirmed he had, but would go again. Next was the NMDOT US 70 — North Main St. Street Utility Rehabilitation project, that the one that you drive through every day now. It goes from Picacho to Solano Drive. The budgeted amount for this project is $1.1 million combined with all utilities. $195,000.00 for Gas, $432,000.00 for Water rehab, and 433,000.00 for the Wastewater rehab. So basically they are replacing all the Gas mains Water mains, Wastewater mains, and services throughout the corridor. This one is actually driven by NMDOT but Utilities have their inspectors inspecting the utility lines. This project is scheduled to be completed April 2015. Uhlig asked if New Mexico Department of Transportation was funding this, Clark clarified that they were paying for the Utility portion of that, it is their ROW, and they are paying for all the surface work and gradient work. Johnson asked if they contract that the whole project, which Clark confirmed. Uhlic asked if that was also the case with the design. Clark said no, and that they utilized the same designer, which is pretty convenient. So Utilities paid for the design as well as construction. Next was the EMWRF (East Mesa Water Reclamation Facility) Solar Photovoltaic Project. Currently they have completed the PER (Preliminary Engineering Report) done by Molzen Corbin. It costs about $49,000.00 to do that PER. They have that report in place so they can start going after Grant funding. Staff has been looking at Grant funding for a while, trying to get people interested in their project. A couple of them are interested, one of them is Border Environmental Cooperation Commission or BECC. They show interest in providing possibly $50,000.00 towards the design, but they are also interested in the overall project. There have been discussions of possibly $500,000.00 being provided by them, but the overall construction for our 500kw Solar Farm is about $2 million, so that is only a quarter of that, and so they are still looking for further funding. As mentioned, BECC is interested in their project and their Co -Gen project, so they are constantly talking to them. The next, and last project was the East Mesa Reclaimed Water Booster Station & Pipe project. The cost for this project is approximately $270,000.00, and it is near completion. They just had a plant inspection earlier this week. Punch list will be generated, and hopefully they will plan to attack the punch list next week to take this project to completion. The last portion they need for this project in order to provide reclaimed water to the Foothills Landfill, for dust suppression and adding irrigation to the compost out there, and it is also the last leg that they needed to provide water to Centennial High School, for their sports fields and landscaping. Once they get this completed, which they are still working with Centennial High School on getting that to tie in, they have their intention to time, so they will just keep working on hopefully eventually be tied in and utilizing that reclaimed water for irrigation. Uhlig had some questions about purple pipes, which were addressed by Clark. Discussion followed. Capital Improvements Advisory Committee Page 12 of 14 Regular Meeting Minutes for September 18, 2014 Utilities Department Development Fee Revenue Update: Dr. Jorge Garcia, Director of Utilities, presented on the second part of the Utilities Department Projects Update, more specifically the Utilities Department Development Fee Update. He stated that the presentation they are looking at shows the debt tables, Table 34 on the to report from the Consultants, not on this presentation but the report from Duncan on Debt Services that have not changed. So if they would like a reference of the debt service schedule for the composite of the bonds it's in Table 34 for the Water Utilities. Just as a recap of the fees, the Committee has seen this chart provided before, as this was one of the last presentations they did when they were narrowing down the alternatives, and they crossed out the alternatives that were not suggested by the Committee, in their recommended AWWA ratios on the meters, and the Committee actually recommended that they have a 10% increase on the Wastewater in the original increase in the Water. The Utilities Board took their recommendation on the AWWA recommendation and took the consultant's recommendation for 16.7%, but then they paid it over two steps. So step 1 fee would be in January 2014, and the step 2 is January 2016. They are currently on the January 2014 fees. They tried to compile some of the dollar amounts in the charts that go with the dollar amounts in terms of fee collection. This current year, in terms of the Water Development Fees, in the FY13; he points out that they have seen some of this when they were finishing the report in FY13, but there was a spike in collections because of a couple of large developments in FY13, and that is why they reached the $1 million in Water and $966,000.00 in Wastewater. Those are the spikes that were in July and October, and at the time the Committee asked what was that and Utilities informed them that there were a couple of properties that probably prepaid for a large amount of money and that it spiked over the average. If you look at FY14, on the graph provided in the presentation, FY14 are low. FY14 had fewer meters in general, but they only have six months of the OT. So for FY14 they collected about $654,000.00 in Water and $692,000.00 in Wastewater. There is a correction that needs to be made in Wastewater in the June portion of about $40,000.00 that were booked in FY15. You can see the graph for Water in FY13, there is a little bit of a spike in June up to a total of $101,067.00 of the builder portion, that blue bar in June FY14, while they were compiling data for this presentation, you see that the June in Wastewater should be showing a spike, because they collected Water and Wastewater most of the time; unless they are paid up front or there is an arrangement. So there are about $45,000.00 that were booked in FY15 that should go on top of that blue bar in June. Other than that we are still talking about $720,000.00 in Wastewater and $652,000.00 in Water. Of the approximate meter count that Utilities offered the Committee before also shows an increase of the total number of meters for FY14. Financially, however, that is particularly for Wastewater, not an issue; if you recall Wastewater is getting paid back from the Inter -fund loans that they have done that report so Wastewater has sufficient funding to cover the debt service. The question would be Water. Utilities said in relation to two to four years, so they would be looking at that if water does not have enough to pay for the debt. The default legally is, of course, the rate case. Discussion followed. Dr. Garcia mentioned they don't have to file for a rate case because they have a rider and that is helpful, because they can do annual adjustments, smaller adjustments a few cents Capital Improvements Advisory Committee Page 13 of 14 Regular Meeting Minutes for September 18, 2014 cover that debt rather than having a big surprise after 4-5 years. So they are covering the debt and there is a fund balance in the development fund for FY15, after everything is paid, of about $230,000.00, a little bit of a cushion and in the Wastewater fund, they have close to $200,000.00. So even after the debt has been paid they have some fund balance left. He reminded them, that their funds are different than Parks or Public Safety. They do not pay for projects other than a couple of projects that Clark mentioned, mainly coming out of the 5401 fund, which is Wastewater Development. Those funds are mainly dedicated to pay for debt. So if they are paying for debt, technically there could be a zero fund balance because next year they would get more fees that goes to debt. They will start on paying the debt and there are no plans to issue additional debt on the Impact Fees side, because as seen in the report from Duncan they have plenty of capacity available. So it is going to be a couple of years before they say, hey we need to issue additional bonds, adjust the fees, for bigger, newer, new projects for additional capacity. Right now there is no need for it. They set the fee right in order to pay the debt. Also if the Committee recalls as part of the Duncan study Utilities moved about $1.3 million worth of debt from the Impact Fee side to the Rate side because it was already accounted for and you can't have development paying for plans that are already in a service that has customers. So hopefully after the Committee looks at Parks and Public Safety fees, they can look at their fees again. Not necessarily for new projects, but to make sure, that they are adjusting that debt services accordingly. Dr. Garcia does not want another $1.3 million dollars surprise moved to the Rate payer. He would rather move small amounts of money from Development to Rates, as they use that capacity. He reminds them that this was one of their discussion points, was to do this more often, otherwise there is a shock — you have the ratepayers and the rate fund 5300. Dr. Garcia goes on to elaborate with an example and discussion was held. Johnson asked when they last issued their bonds. Dr. Garcia mentioned that this was two months ago, where they did a refunding of the 2005 Bonds and saved about $224,000.00 that the Council approved. They refunded about $8 million dollar of 2005 Bonds and issued an additional $3.2 million for rehabilitation, because Loretta in Transportation is going to be doing some projects through the City, and every time they do the Street, it is a full reconstruction hit to the Utilities. They also refunded, which saved them at present bond value about $530,000.00. So it was a good deal. He goes on to say, that he wanted to refund 2006 Bonds, but those were not eligible and only the 2005 Bonds were eligible. He concludes, that although they have fewer meters, financially they are as predicted. They are going to have to grow into this new fee, get additional revenue, but the debt is getting paid. Chair Hamilton stated he appreciates the updates from the Carl Clark and Dr. Jorge Garcia. Dr. Garcia mentioned that the Committee requested an update on the projects since 2005 and now they have all the information of the projects that they have started. Hamilton agreed that a Ten-year procedure puts things into perspective of where Utilities was back then and where they are now. Capital Improvements Advisory Committee Page 14 of 14 Regular Meeting Minutes for September 18, 2014 After Ms. Alma Ruiz handed Dr. Garcia a laptop with current numbers, he adds, that the revenue bonds actually had $7.125 million in refunds to the 2005 Bonds and $521,000.00 in NET PV Savings, TIC of 2.06%. That is a good deal. The newer monies were a little more expensive at 2.98% TIC. 5. Committee General Discussion. Chair Hamilton thanked everyone, and asked Travis Brown, Chief of Fire, if he had any updates, and Brown stated he did but for next meeting. He just wanted to make sure that was still the plan, if so he will be here next meeting to provide a presentation what they are suggesting as a timetable moving forward with Public Safety Impact Fees, to get the Committees input, so they can finalize that. Hamilton asked Loretta Reyes, Public Works Director, if she had anything for them. She stated she did not. Chair Hamilton asked if anyone else had anything to bring forward, and since that was not the case he thanked everyone. 6. Next Meetina Date. Johnson stated that the next meeting date would be October 16, 2014, at 1:30 p.m. Chair Hamilton confirmed. 7. Public Participation. None. 8. Board Comments. None. 9. Adjournment. Uhlig motioned to adjourn the meeting. Seconded by Johnson. All in favor - Aye. Motion carried. Meeting adjourned at approximately 2:42 p.m. Lonnie Hamutorf CIAC Chair %'r/'� Date