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10-05-89 S&W Comm Minutesw • Attendance: Furlong. SEWER AND WATER COMMITTEE MINUTES October 5, 1989 4:00 P.M. Chairman Nystul, Vice Chairman Hopkins, Councilman Others Present: DPW Hammer, S/W Supt. Van Dyke, Surveyor Zavodny, Tom Flynn, Colin Wills, Dug Ellman, Rick Hull. PURDY/REMICK - UPDATE S/W Supt. Van Dyke presented a brief update on the Purdy/Remick. Sewer project. The engineer is conducting the necessary field work to complete the design. Easements are being negotiated. Surveyor Zavodny informed the Committee it has been agreed that Mr. Beaver, upon his request, will restore his property after the sewer main is installed. He explained the easement for Mr. Beaver's property. The City has an easement for the existing 27" main, which will be exchanged for an easement for this project. C. Nystul requested S/W Supt. Van Dyke to obtain a sketch of the project for explanation. HUTTON WATER MAIN EXTENSION S/W Supt. Van Dyke presented a brief update on the Hutton Water Main Extension. The project was awarded to NuPack 2 Co. The consultant has received the signed contract documents, which are being reviewed by the City Attorney. A Pe-e- Construction meeting is tentatively scheduled for October 13, 1989. Notice to Proceed is tentatively scheduled for October 16, 1989. After Construction begins, the Contractor has 30 days for completion. C. Nystul questioned necessary pavement replacement. S/W Supt. Van Dyke stated a provision exists for maintaining the pavement replacement areas throughout the winter. LAWRENCE PARK REMODEL - BID AWARD S/W Supt. Van Dyke presented written bid comparison for the remodeling of Lawrence Park. The bids were higher than estimated. Three infrared heaters will be deducted in the chlorine room and the shop/storage area. A gas forced air furnace will heat the chlorine room. The infrared heaters require more initial cost. S/W Supt. Van Dyke reported the City Attorney has informed him negotiations can take place within 25% of the bid price. He requested the Committee to recommend to the City Council to award the bid to Bob Ross, low bidder after the deduction of infrared •heaters, and authorize the S/W Supt. to enter into negotiations to delete several construction options to lower overall price. C. Nystul called for discussion. C. Furlong questioned the architect's estimate. S/W Supt. Van Dyke stated the architect was surprised the bid was high. r1 u DPW Hammer stated the bid exceeds the budget by approximately $2,000.00 after deducting the allowed 25%. C. Hopkins questioned if the rooms are heated for equipment or employees. S/W Supt. Van Dyke stated one area is for the pumps and the shop area is used for storage at present. Employees spend approximately three hours per week in the storage area. C. Nystul stated he is in concurrence for the deletion of heating in the shop/storage area at this time. Infrared heating is an efficient heating alternative and should be considered for installation in the future. C. Nystul stated he believes the concrete pad and sidewalks should be done by the contractor for $650.00 and is not worth deleting as well as repairs to fencing. There is not a problem with exceeding the budget as long as the engineer's estimate is supportive. C. Furlong moved to recommend to Council to award the bid to Bob Ross Construction and direct the S/W Supt. to enter into negotiations on the scope of the bid. C. Nystul requested S/W Supt. Van Dyke to report back to the Committee on negotiation before the • Council meeting. The Committee agreed and the motion carried in favor. VEHICLE ACQUISITIONS S/W Supt. Van Dyke informed the Committee he is looking at purchasing two low mileage, used pickup trucks to replace vehicles in the Water Department. C. Nystul stated he would like to see the vehicles which are being replaced traded in for economic and safety reasons. C. Furlong requested that a warranty be included with any vehicle purchased. C. Nystul questioned if there were any additional comments on the above discussion items. HUTTON WATER MAIN EXTENSION Mr. Wills questioned the off course error on the water (actually sewer) main installation on Grandview Drive as well as the installation of a manhole at this location. S/W Supt. Van Dyke explained that due to the error the manhole was installed at the expense of the contractor and/or the college. The S/W Supt. and Sewer Foreman made the decision to have a larger size manhole installed to inn -ease the wet well capacity. The City will pay the difference for the installation of the larger size manhole. EVERGREEN SEWER - DISCUSSION C. Nystul informed the Committee a •request was received from the Evergreen Sewer Board to meet with the City to begin the next phase of discussion regarding a proposed contract or interlocal agreement between the Evergreen Water/Sewer District and the City of Kalispell. They have accepted the City's letter as the parameters to discuss. The Committee needs to outline and draft all concerns and questions. One of the discussion items 4- in the proposal is to arrive at two costs: 1) cost of the lines being utilized from the point where Evergreen connects to the treatment plant, and, 2) cost of Evergreen's share of the actual operation of the treatment plant. C. Nystul then referred discussion to the Committee and Staff. C. Furlong expressed concern for the perception of the public of the City wanting to profit from Evergreen. He does not want to make a profit, but he also does not want the residents of Kalispell paying increased costs for Evergreen. Any negotiations requires expertise in the field. He will require justification for whatever rate is proposed. There will have to be a specific method to resolve dispute over rates, increase in rates, payments, etc. C. Furlong also expressed concern for any potential odor. He insists that whatever the state-of-the-art is for odor elimination be a part of any agreement. There is ample evidence which suggests odor is a primary problem. S/W Supt. Van Dyke stated annexation should be required, as well as requirements for Evergreen paying the same rate as City residents. He sees development happening in Evergreen and Kalispell sharing the cost of treating the sewage. Proposed rates should be equal and • fair. C. Furlong stated there are two examples parallel to Evergreen; i.e., Greenacres and Bitney are special agreements outside the general rules and regulations. S/W Supt. Van Dyke questioned payment enforceability when Water Quality Regulations stipulate the inability to shut off sewer. This problem exists with Greenacres, who owes the City $18,000.00. C. Nystul stated the agreements with Greenacres and Bitney lack a method to enforce payment other than litigation. DPW Hammer stated the rules and regulations state the rates are such and the City cannot enter into negotiations without a Public Hearing. If Evergreen is given sewer the community of Evergreen will be increasing and Kalispell will remain stagnant. There are other issues to consider. If the Council and Evergreen reach an agreement a Public Hearing will have to take place to modify the rules and regulations to reflect the agreement. C. Furlong questioned what rules and regulations governed the agreements for Greenacres and Bitney. DPW Hammer responded the agreements were Developers Extension Agreements, Evergreen is not a new subdivision and is not a developers extension. He believes Evergreen should at least pay the same cost as in -city users as well as signing a waiver of protest of annexation. Any deviation from • the rules and regulations could pose a real problem. Mr. Flynn questioned if the City is offering a volume discount to Evergreen. C. Nystul responded yes, from the rate standpoint. Mr. Flynn read a letter from EPA written in 1981. This letter was the basis for Kalispell's Sewer and Water Ordinances. This letter is as follows: "Enclosed are comments from EPA on user charge system for Kalispell. Please submit revisions to our office for approval... Each user or user class must pay its fair share of the operation and maintenance cost of the wastewater treatment works. For example, the non-residential user contributes three times the loading of the average residential user. That user would pay three times the amount the residential user pays for its share of O & M cost. Please note volume discounts are not allowable." C. Nystul rephrased his statement as Evergreen not receiving a volume discount. It is a different type of user that the City is dealing with, a single user for whom the City is not providing the same level of service the other users within the community. Mr. Flynn requested clarification of C. Nystul's statement. C. Nystul responded the City is not maintaining the system in Evergreen. Mr. Flynn stated this has no bearing, it would eliminate the 125% but should not affect the cost per thousand at the plant, the debt retirement or capital costs. He questioned who was involved in the preparation of figures in the EPA report of Stahley Engineering. C. Nystul responded the numbers in the facility plan were derived by Stahley Engineering. Mr. Flynn stated the figure used was $6,000.00 is the amount stated to kpay the City of • Kalispell to run 85 million gallons of sewage from E. Oregon to the treatment plant. If this is figured on a percentage basis the cost would be approximately $60,000.00. C. Furlong reiterated that he is not agreeing to rates unless expertise on rate structure is obtained. C. Nystul stated he does not know where the numbers were obtained nor did he have any part in of deriving the numbers. Mr. Flynn stated EPA loans require provision for replacement, depreciation finding. For the new plant depreciation will be approximately $100,000.00. This is a margin above expenses that has to be set aside. C. Furlong stated Evergreen will pay at least what the City of Kalispell pays on a per gallonage basis. The City benefits from not conducting maintenance in Evergreen and central billing. Mr. Flynn stated the agreement would not be worth anything in the eyes of the Public Service Commission if the City starts violating the rules and regulations in regard to hookup fees. DPW Hammer stated Stahley's numbers show $1.40/thousand whereas the City's rates are $1.57/thousand. He questioned who will be pumping • the septic systems in Evergreen and who will treat the sewage from the septic systems and what fees will be charged. Mr. Flynn stated three concerns: 1) Odor problem, which cannot be quickly corrected when it exists, ithe City must have a bonded guarantee from project engineers ocvering a period of years C� guaranteeing performance without odor problems, 2) Payment to the City must be at rate schedules established by law and must not discriminate against City users, 3) Must have a guaranteed payment from Evergreen, Evergreen must post a bond covering a period of at least five years guaranteeing prompt monthly payment to the City of Kalispell. Mr. Flynn stated the City of Kalispell is entitled to a community hearing involving discussion of rates. Hate hearings require that notices be sent to all Kalispell users setting forth the present rate and what the rate will be with examples. There is an ordinance which states once a year the City must provide users with a breakdown of how their money was used. This was done in 19B6 combined with a hearing notice. C. Nystul stated concern of the flooding of the treatment plant when it rained. He questioned the causes of infiltration. S/W Supt. Van Dyke responded roof drains and storm water as causes. He is working with the Sewer Foreman in identifying causes. Roof drains will be hard to identify. C. Nystul then adjourned discussion. Adjourned: 5:30 P.M. 0