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HomeMy WebLinkAbout11-26-18 Utilities 4O�vlrig4�� U C PEACE ;,- %v 1865 s OFFICE OF THE CITY CLERK KAREEMAH FOWLER, CITY CLERK UTILITIES NOVEMBER 26, 2018 4:42 P.M. Committee Members Present: Oliver Davis, Sharon L. McBride, Jake Teshka(late) Committee Members Absent: Regina Williams-Preston Other Council Present: Tim Scott,Jo M. Broden, John Voorde, Karen White, Gavin Ferlic Other Council Absent: None Others Present: Bianca Tirado, Graham Sparks, Bob Palmer, Gabriel Murei Presenters: Eric Horvath, Kara Boyles Agenda: Bill No. 61-18- Amending the South Bend Municipal Code to add a new Article 14 Establishing Interim Storm Water Utility Rates Vice Committee Chair Oliver Davis called to order the Utilities Committee meeting at 4:42 p.m. He introduced members of the Committee and announced the lack of a quorum, rendering the Committee incapable of taking official action on legislation. He then gave the floor to the presenters. Bill No. 61-18- Amending the South Bend Municipal Code to add a new Article 14 Establishing Interim Storm Water Utility Rates Eric Horvath, Director of Public Works with offices located on the 13th floor of the County-City Building, stated, We discussed this during our budget presentation, as you may recall. We had submitted Fund #667 which had both a revenue and expense budget and it was contemplated that there would be a separate enabling ordinance that the Council would have to go through and approve. Committee Chair Jake Teshka arrived at the meeting at 4:43 p.m. Committee Chair Teshka's arrival enabled a quorum for the Utilities Committee. Mr. Horvath continued, A lot of these slides will look familiar because you've already seen it through the budget presentation. I will go through it again, pretty quickly, and then we will have time for questions on any of this. So, we not only have a changing climate but we also just have a long time need for storm water improvements. My staff and I hate when it rains because we get inundated with calls. People have flooding in the streets and in their basements and one (1) of the issues we have is that there is no dedicated funding to solving those issues. So back when they INTEGRITY I SERVICE!ACCESSIBILITY JENNIFER M.COFFMAN BIANCA L.TIRADO JOSEPH R.MOLNAR CHIEF DEPUTY/DIRECTOR OF OPERATIONS DEPUTY/DIRECTOR OF POLICY ORDINANCE VIOLATION CLERK EXCELLENCE I ACCOUNTABILITY I INNOVATION I INCLUSION I EMPOWERMENT 455 County-City Building 1227 W.Jefferson Blvd.I South Bend,Indiana 46601 I p 574.235.9221 I f 574.235.9173 I www.southbendin.gov )CITYOFSOUTHBEND OFFICE OF THE CLERK started the MS4 programs back in 1999, they never really funded anything in South Bend. Most other communities funded their programs through some storm water fee. That storm water fee would go both to supporting operations for the staff that needs to continue maintaining that program and also for capital improvements with the storm water issues. South Bend never did that and are one(1) of few communities that did not. So it is becoming an increasingly big issue for us and is something we feel important that we fund because otherwise we don't have the money to do capital storm water projects. In the past,because there was a need,we tried to fit them in various Funds. More recently, if you recall the 2017 and 2018 budgets, we had it in the Local Roads and Streets Fund. We had a portion in there for drainage and that was taking away from our ability to do roads. We are also spending down our cash reserves that we have in those Funds, so, I think it is important we have a dedicated Storm Water Fund and that is why we are asking for this today. He went on, I would like to go through this presentation (which is available in the City Clerk's Office). This is essentially setting up a separate Fund and a funding mechanism for that Fund. We've said, as we went through the budget presentation, that our intent is to initially not use this for any operations. We will continue having the operations paid for like it is today but to use this for capital projects and professional services in relation to those capital projects. So what we are proposing and what you will see here (referencing a slide in the presentation) is slightly different from what I showed you at budget time. At budget time we had two dollars ($2) per residential customer, per month. That has not changed, but we had a tiered program for non-residential and that was four dollars ($4), eight dollars ($8) and twenty dollars ($20) depending on how much impervious surface you have. The problem is our current billing system is about twenty(20) years old and it is really difficult for us to get that into the system. We have to go through and change each bill separately. So, we decided to just change that to a five dollar ($5) flat fee for non- residential customer. So any non-residential is going to be five dollars ($5) a month. The thought is, and what is in the ordinance if you read the two (2) year issue here at the very beginning, it talks about this being in place from June 1, 2019 and for two (2) years. We will take that time to start studying what we need to do to go to an impervious-based rate system. We are currently starting our process of a new billing software on the Utilities side and that is about an eighteen (18)month process. We would be in a good position, two (2) years from now, to put in a different system that would be more in line with being charged, per ERU, based on the amount of impervious surface you have. This provides an incentive to have less impervious surface. He continued, So what does a system like that look like? If you look at all of our residential properties and we figure out the average residential property has 2,000 square feet of impervious surface and that is roof, asphalt and other stuff that doesn't allow water to sink into the ground and it runs off, and I have a commercial property that has 10,000 feet square of impervious, then I would pay five (5) ERUs because it is five (5) times the residential average. Moving to a system like that is a lot more complicated. It will be time consuming in terms of figuring that out because we will have to figure that out for each and every parcel in the City, and then bill each and every parcel separately. We didn't want to do that right off the bat just because of the complications, so, we put in a very simplified approach to start but that is what we are looking to do long-term. We look to sit back down with the Council in a couple of years and talk about a program that is based on impervious surface and is more reflective on what your impacts are on the storm water. Most utilities, you'll see they have storm water fees and they do it based on impervious surface. About four(4) in five (5) cities do it on an impervious surface basis. The other thing to show you is that we have 1,600 plus storm water utilities in the US and the national average is about five dollars EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION j EMPOWERMENT 455 County-City Building 227W Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 2 CITY OF SOUTH BEND OFFICE OF THE CLERK ($5)per month for residential. So the ERU equivalent,nationally,is five dollars ($5)per month as opposed to our two dollars ($2)per month. He went on, You've seen this as these are the existing needs we have. It is about $2.9 million of immediate needs. This (referencing a slide in the presentation) is the proposed budget that was passed for 2019 which includes $1.2 million of expenses. This at that time, we were looking to implement this starting January 1, 2019 but, again,because of the billing issues,we think it makes a lot more sense to start June 1, 2019. Plus that would give everyone a little bit of time for the fee starting up. So this ordinance, the way it is written today, contemplates a start date of June 1St, 2019. So we revised our budget so the expenses would be $600,000 and not $1.2 million. And there were a couple of things that we felt were important to move forward with that were in the LFA study. If you recall, some of the flood inundation mappers and some backflow gates that we want to get on some of those storm lines because of the last major flood event we had. Those things,we took out of this and put them into the Waste Water budget so we can move those forward a little quicker and not lose those things as we had to revise this budget. That is about$100,000 of flood mitigation money that we've moved out and into the Waste Water Fund.But our new budget, then, would be$600,000 for 2019 because, starting June 1, 2019, we will be generating less cash. These (referencing a slide in the presentation) are just some projects I will run through. He continued, As you know, we are getting to the end of the Downspout Disconnection Program. We need to really start looking at the commercial and industrial folks who are left and try to figure out how we can get them off. They have until the end of 2020 to be off the system according to the current ordinance. Draining improvements, I think you saw this list before in the previous presentation. This is just our top ten(10) list that we have right now with mostly smaller drainage projects as it is everything from small storm sewer, dry wells, some catch basins or inlets, and stream stabilization projects. Here is the list(referencing a slide in the presentation). As part of our storm separations, we had $400,000 in there and we've moved that down to $280,000 so we can move forward with Western Avenue. As you may recall, Western Avenue Phase Three (3) is moving forward with TIF dollars but the storm component is not funded. It doesn't make sense for us to rip up the entire road up, get in there and do everything and not separate the sewers at this time, so we would we looking to do that. Then this (referencing a slide in the presentation) you can see where the bank has failed. We've got a layer grant here but we need$40,000 to match that grant. He went on, And then this (referencing a slide in the presentation) is the 2020 list which includes a lot of stuff that you've seen before. There will be work on the dam, the East River, a lot of drainage projects, additional bank stabilization on public properties and other things. Here (referencing a slide in the presentation) are the eighty-six (86) communities in Indiana with storm water fees. You can see almost every city and town with a population over 25,000,in Indiana,has a fee with the exception of South Bend. Here (referencing a slide in the presentation) is the same breakdown but you can see what they are charging per month. This is the residential equivalent and is the ERU piece. So we are proposing two dollars ($2). Our statewide average is five dollars and thirty-six cents ($5.36) and that is really close to the national average of five($5)dollars. This (referencing a slide in the presentation) is the annual estimate. This is not starting June 1, 2019. This is an estimate of a January 1 start date. You can see what the two dollars($2) and five dollars ($5) generates and it is a little over$1 million per year for storm water. EXCELLENCE ACCOUNTABILITY INNOVATION 1 INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574 235 9221 f574.235.9173 11D574.235.5567 www.southbendin.gov 3 •CITY OF SOUTH BEND I OFFICE OF THE CLERK Committee Chair Teshka stated, First (1St) of all, I want to apologize for my tardiness. Councilmember Davis, thank you for holding it down while I was out. I would like to open the floor to questions from Committee Members. Committeemember Oliver Davis stated,A couple things. You said in a couple of years, you would come back to talk about the study. Does it normally take two (2) years to do the study? How long would it take? Mr. Horvath replied, So what we did was have this rate applied for two (2) years. We are looking to transition at that time to give people an idea of what it would be for the first (1st)two (2) years. That study can happen before and we will start it before then and then we will have a lot of dialogue with the Council because you will be involved in helping decide what those rates will be and how we will structure that. But one(1) of the issues we have is that our implementation for the billing software is an eighteen(18)month implementation cycle. We will be starting that at the beginning of the year and so we won't really be able to do anything on the billing side until eighteen (18) months regardless. So if we want to try to do that earlier, it would be near impossible for us to do it with our existing billing system. We would be spending a lot of money to have someone from the outside come in and individually redo 40,000 rates. We thought it made sense to wait for that process to be done. That is why it is two (2) years. He went on,I will say also,and I apologize because I forgot to mention this.As we've gone through this Long-Term Control Plan, I realize people continue to think we are adding fee after fee, and it really is just trying to meet the needs of the community in terms of requirements of the Clean Water Act as well as requirements of our citizens in terms of not wanting flooded streets and things like that.As part of that,we know the Long-Term Control Plan is under negotiation right now. We are working hard to get it down from a$700 million plan to somewhere around$200 million. That will help tremendously but it still puts us at a pretty high burden when you have to pay for a$200 million plan with the residents we have. We've got a significant population of low-income folks. Forty five percent (45%) of which are below ALICE. That is a significant problem. Once of the things we are researching right now and that we look forward to having dialogue on in the future is moving toward some sort of income-based rate. We want to find a way for folks with extremely low incomes will get some type of break on their rates so that they can become a little more affordable. Committeemember Davis interjected, Do you find any cities doing that now? Mr. Horvath replied, We've been talking to Philadelphia. Philadelphia is the only city I know of, in the nation,that has done it on an income-based rate. There are a number of cities we have looked at as examples that have done customer assistance programs so we are trying to do the research up front, again, to try and make sure we can, one(1), do one(1) that works within our billing system and two (2) doesn't take a lot of overhead costs. We don't want to spend five dollars ($5) to save six dollars($6), am I right? What I mean by that is if we are not careful with how we structure the program, we would have a bunch of people hired to implement a very complicated program. So we are trying to find ways to make sure things like income verification are easy to do, streamlined, and possibly done by an outside source. I know that Philadelphia's program is $2 million. So right away that is $2 million a year that isn't going to the benefit of low-income folks because you're spending it on administrative overhead. So we are trying to keep the program overhead costs down by creating a simple program. We are a number of months away from having a proposal for the EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 4 CITY OF SOUTH BEND , OFFICE OF THE CLERK Council but it is something on the radar that is important to us that we definitely will bring as a proposal to Council sometime in the near future. Committeemember Davis followed up, What was the rationale to not put this as part of the 2019 City budget? Mr. Horvath replied, This was all in the City Budget that you passed. Fund#667. Committeemember Davis interrupted, So, all these raising rates? Councilmember Karen White replied, No, that is what we are talking about right now. Mr. Horvath stated, There were two (2)parts of this becoming a reality. The first(1st) one(1)was getting it in the budget and having a budget set for revenues and expenses. And then the second (2nd) part which has to happen for us to collect a dollar is the enabling ordinance, which we are doing now. So this does two (2) things. It sets the two-dollar ($2) and five-dollar ($5) fee and establishes the Storm Water Fund. Committeemember Davis followed up, So if the Fund is not set up then we cannot enact that, is that correct? Mr. Horvath replied, That is correct. If you don't pass this legislation, we don't collect what we budgeted for to receive. Committeemember Davis interjected, And what was the rationale for us not using TIF funds for this? Mr. Horvath replied,You could use TIF dollars to fund storm water but it's not sustainable. If we are trying to create sustainable funds, we really should have funds that have their whole background meet the purpose of what they're for. Otherwise they are fungible and anybody could use them for any purpose. So any new Council or any new Mayor could decide to use them for different purposes and then you're back to where you started. Committeemember Davis interrupted, Isn't that the same kind of decisions that we would do? Mr. Horvath clarified, What do you mean? On TIF dollars? Committeemember Davis replied, No, I'm talking about regular dollars. Any Council can make a decision on whether or not they are sustainable. Mr. Horvath stated, Every year you have a budget process you go through and you decide whether or not it makes sense. We propose a budget and then you decide if it makes sense or not. The reality is we have an issue with storm water that we have to address. The way we have been addressing it is taking money from Roads. The Roads funding is not adequate enough to keep up with even the road needs. Councilmember John Voorde interjected, You need a dedicated fund. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 1 10574.235.5567 www.southbendin.gov 5 CITY OF SOUTH BEND OFFICE OF THE CLERK Mr. Horvath continued, We need a dedicated fund, otherwise we will continue to have the same issue. Committeemember Sharon L.McBride interjected,I can see what Councilmember Davis is saying. The reason why I say that is because we have had discussions about the impoverished and the diversity in the City. Maybe if you're talking about the first(1St) year because I know the first(1St) thought was wanting to implement January but when we talked about it you talked about delaying it to June to get people prepared for that fee. Where I can see the concern is maybe just the first (1st) year using TIF if it is available to use and then look toward more sustainability after. It still seems like there are different things we have to do to get there by June 1 and we don't know what the impact will be on people in that forty five percent(45%). If we have people's water turned off now, how are we making sure we aren't putting a burden on them? I did agree and I talked with you guys and was also considering the delay, so I see both sides. Committeemember Davis interjected, But the thing about it is,though I appreciate it,to me and at least from my point of view, nobody has argued the case to me that why we cannot implement starting day one(1) as we vote on this a plan that also includes assistance for those that cannot do it and everything else and not piece meal this all the way through. I have a problem with piece mealing things that do not have a complete picture. Saying ok we are going to work on that between now and June but since we are not starting it, and the date of implementation was not June 1St 2019 and that was able to be delayed, I can see the need for us to have to vote on this tonight without having that information. To have a complete program in place,as best we can,to have that starting out, it makes sense to me if we are going to have that. We have, what, six(6) or seven(7) months? Seven(7)months that is almost two (2) semesters in the classroom. Students can do that as a full study in three(3)months. So that is twice the time and we could have something in place where we put that together and everything is there so it isn't piece mealed together. That's just how I see it. Councilmember Voorde asked, You don't have the billing system to accommodate that, correct? Committeemember Davis interrupted, And that would be nice to have one (1) of those. Mr. Horvath replied, Yes, and especially if we go to an impervious based system. Talking about the income-based rates and the Storm Water Fund, those are two (2) separate and distinct issues we are trying to address. Committeemember Davis interrupted, Partly. Mr. Horvath continued, One (1) is the funding mechanism for storm water, which is what we are trying to do here. That is absolutely one hundred percent (100%) in your purview and you will decide if we move forward with this or not. Then I have to live with whatever is decided because then I have to figure out if I can do projects or not. And I'm just telling you that it is frustrating being on this side of the table getting the calls and not having a way to help people because we just don't have any funding and the only way we can do it is by stealing from other funding sources. The income-based rate is also something that is really important to do for another reason and that is because we have people hurting and we are looking at ways that we can help that and that will be on the waste water component of their bill. It probably won't be on the water piece just mostly due to legal reasons. Until last year, this wasn't even a possibility in the State of Indiana. There EXCELLENCE ACCOUNTABILITY INNOVATION I INCLUSION EMPOWERMENT 455 County-City Building i 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 6 ®CITY OF SOUTH BEND i OFFICE OF THE CLERK was some new legislation they put in that allowed for us to have these differential rates. So I see them as separate entities and separate decision processes. From my perspective, it is important for me to move forward with the storm water fee because I'm sitting on this side of the table with people calling me and asking for help and we are having trouble giving them help because we just don't have the funding. Committeemember Davis interrupted, And I'm sitting on this side of the table with people feeling we are taxing them too high, too, and I'm also sitting there as a resident of South Bend that deals with that. And so,therefore,we are all sitting on this side of the table that both of these plans need to be coined out at the same. So arguing on what side of the table we're on is, to me, a waste of time. The second (2nd)thing is I think we can both put them out.You have to consider how people look at us. When they see this go into place, when we could have a rate here and a caveat there, people can deal with that better. You're the Administration and you are going to have to deal with this for the same kind of situation for the next six(6)months or seven(7)months anyways because there's no money coming in until June. And then just because the money starts coming in July, money is not just going to show up just from that standpoint. Basically a year from now. So the idea of us passing this tonight is not going to be able to get you off of that side of the table anyway. So my thing is when we do it, we need to do it right, let's not just do it just to be doing it. Councilmember Tim Scott stated, What Councilmember Davis is saying, you won't see that from me a year and a half from now when we vote on that. I understand what you are saying about the sustainable Fund. We are a river city. I came from river city and they are dealing with the same issue down there.Your billing,is that through Citiworks?What program are you looking at?Don't tell me Accela. Mr. Horvath replied, No, I think it's called Systems And Software. We went through a pretty extensive selection process. We had five(5) different entities come in and showed us their billing software. We had a whole group that reviewed it and it was a lot of our billing and Innovation staff. Councilmember Scott followed up, So this could go into effect with the billing system you have right now? Mr. Horvath replied, Yes. Councilmember Scott then asked, So how long would it take you to get to that income-based billing? Is it with the same software company? Are they able to do that or will you have to look at a totally different system? Mr. Horvath replied, No, Systems And Software will support that. Councilmember Jo M. Broden interjected, Or the variable rates? Mr. Horvath replied, Yes, it will support both. We could do it with the one (1) we have but we would have to hire someone from the outside to come in and do it just because you would have to touch every single bill and we don't have the budget or ability to do that. Committeemember Davis interrupted, Is there a cost? How much would that cost? EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221'1574.235.9173 TTD 574 235 5567 www.southbendin.gov 7 eCITY OFSOUTH BEND OFFICE OF THE CLERK Mr. Horvath replied, It would cost more than what you would make on the system in the first (1') year. We can try to cost it out if you want. Committeemember Davis interjected, I would appreciate it. Because the whole thing is you just argued a case that we need to look at a long-term solution. You said that is why we are not using TIF dollars because we want to look at a long-term solution. So, my thought is if you're going to look at a long-term solution, we also have to look at a long-term approach to match the long-term solution. Mr.Horvath clarified, Meaning you want to go to impervious right off the bat? Is that would you're saying? Committeemember Davis replied, I mean, I would love to have everything set up. I mean we brag about having high tech, why can't we invest in all of that? We have a Tech Committee and the people on our Tech Committee are getting paid some high dollars in this City. So, I mean, everything else tech, they do some good stuff and I don't understand why they can't put that together. Councilmember Scott stated, What Councilmember Davis is saying, and I can agree with him, is there gap funding till you get to the point where you have the budget and the infrastructure put in place to do the income-based fee? And we don't even know what timeline that would be. Mr. Horvath replied, We don't have it in the budget. Could we go back and change the budget and take road money out and put it back into drainage? Sure. Committeemember Davis interrupted, I don't think we have to go back and take road money out. We can appropriate dollars. We are appropriating all the first (1st) readings for the next meeting. We can appropriate dollars for us to do this, we just need to know what the money is and what it is for us to do it right. We don't even need to compare this against roads. Mr. Horvath replied,Well it doesn't have to come from Roads but it has to come from somewhere. Councilmember Scott stated, I think, Councilmember Davis, you're thinking General Fund or somewhere. Committeemember Davis replied, Yes, that is what I'm thinking. Councilmember Broden stated,I have a couple of questions. On the residential and non-residential rates, how did you get to those rates? It would seem to me that averages are important, right? My gut instinct is that doing twice as more costs a little. Walk me through how we got to that. I'm in support of this because we are already paying for this either in the existing City budget. It's historical that we are stealing from one(1)area or another to get this done. We are kind of reactive. So we need something, right? So I support this and I acutely feel it. There is not a single street in the City of South Bend that is not impacted by this, right? Mr. Horvath replied, Sure. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f574.235.9173 TTD 574.235.5567 www.southbendin.gov 8 CITY OF SOUTH BEND i OFFICE OF THE CLERK Councilmember Broden continued, Per the maps that we saw during the budget process or that I know I saw during our flooding. There was a not a single street in the City of South Bend, or it was very low,who weren't affected. So we are already paying for it. I think we are acutely aware that our residents are already paying for this in terms of damage to their households,ok? So having said that, though, I want to make sure that on the simplified system, I appreciated the different variables that were gauged in the first (1st) draft of this. So help me with the two dollars ($2) and five dollars ($5). I'm just going to say it, five dollars ($5) seems like a low-ball number for a commercial property just based on wherewithal, right? In some regards and just size. So what informed, and I'll go back to the original question, this two dollars ($2) and five dollars ($5)? Mr. Horvath replied, So even to do any type of tiered rates, we would have to do two (2) things. One(1), we would have to calculate the amount of impervious surface on every single individual property. Otherwise, we can't figure out what tier they're in. Secondly, we would have to manipulate their bill. So the problem is,we would spend a lot of money doing that because we will have a firm come in, we'll figure out the impervious surface, then have someone come in and do each bill. And rather than spend that money and have someone pay twenty dollars ($20) a month instead of five dollars($5)but use that money for outside consulting,we wouldn't really reach our ability to do more projects. We thought to simplify it. It is not a perfect system. We will more toward a more perfect system although we know no system is always perfect. There are always winners and losers in any rate structure. So we will move to what most people perceive as a more equitable process by doing impervious surface which is what the majority of folks do. We wanted to initially establish these rates and make it simple so that we are not spending a lot of administration overhead dollars. Councilmember Broden followed up, Ok I got that and that does make sense. Now how about the assumptions that could be made from Assessor records? And then maybe an appeal process? I know how much sidewalk I have, you know what I'm saying? Those records that have that detail or those assumptions that could be made on the square footage and the roof that is over that square footage and then the driveway. Isn't that broken down in some regard already? Councilmember Voorde stated, All that information should be available in the Assessor's Office. Kara Boyles,Deputy Director of Public Works with offices located on the 13th floor of the County- City Building, stated, It is not. The actual impervious area is not calculated. The area of the parcel would be calculated. Councilmember Voorde interjected,Yeah the parcel but then if you take the square footage of the structure and the square footage of the parking lot, which are separate assessable items, subtract that from the size of the parcel, you could end up there. Ms. Boyles replied, This ordinance is by customer account which, again, makes it different than the traditional system that would have gone through the tax parcel. If you are an entity that has multiple accounts, you might have five (5)bills so you would be paying five(5) times. Councilmember Broden stated, So that was one(1) question. Committee Chair Teshka stated, If I could, we are way over time as it is and I know this is important,I have some questions myself and some things to add.We also still have to do the public EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD574.235.5567 www.southbendin.gov 9 CITY OF SOUTH BEND ! OFFICE OF THE CLERK portion and this is up to Mr. Horvath, but my thought is that we continue this conversation unless you want to have a vote on this tonight. Mr. Horvath replied, I've said before that we haven't had this fee since 1999 when they put the implementation of the MS4 Program in. It won't kill anyone to have an extra week or two (2) on this. But at some point, we need to make a decision on whether or not we are willing to have a storm water fee and a sustainable Fund for storm water. I don't have any issue with that, I would just appreciate that if there are specific questions, please bring them to me and we will give you whatever answers we can. Whatever we can't, we will let you know. Committee Chair Teshka stated, I don't want to take this to the floor tonight and have an outcome that is not desirable. Councilmember Scott stated, I would suggest that between now and, say, Monday of next week, we run all the questions specific to this ordinance to you, Committee Chair Teshka. He will then feed them to Eric and then that way next week he will be able to address those specific questions. If we need a separate meeting on this we can do that before we vote. Does this need to be done before January 1? Mr. Horvath replied, Well that would be great because we could start working on figuring out the program. We've got plenty of time. Councilmember Broden asked,This would allow you to bid then,though,right?Basically the 2019 season amounts because you know how much is coming in, we wouldn't miss that critical first (1St) quarter? Mr. Horvath replied, That's a really good point that Councilmember Broden just made. Projects aren't designed overnight and we aren't going to start designing if we aren't sure we have funding in place because it doesn't make sense. To your point, if we wait too long then the issue is it gets pushed to next year and there isn't any construction season left if we start there. Committeemember Davis stated, But one (1) point she made, I thought was interesting is that we are already paying for it. How much are we already paying? Committee Chair Teshka stated, I think that's incalculable. Committeemember Davis interjected, No, no, it needs to be calculable. Councilmember Broden stated, I guess my closing is at this proposal where it stands now, and thank you for the clarity in how we got to the non-residential, but it is grossly under what other municipalities are doing. So, it is only so long that we can continue to patch this and underfund it. I've appreciated your past proposals to bring along our infrastructure that has been long underfunded. As I said, this is impacting everyone and frankly it is only going to get worse. So the longer we delay and the longer we put this off, the more difficult and the more burdensome it becomes for of our residents. Not only for the ones that are resourced but those that are not. Any of these projects that I am aware, they impact an entire area, not an individual resident or neighborhood. It is up to us to look at that. Roll it out, in my opinion. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD574.235.5567 vwvw.southbendin.gov 10 CITY OF SOUTH BEND OFFICE OF THE CLERK Councilmember Voorde stated,Just real quickly,one(1),having a dedicated fund is just a common sense approach. We are overdue in doing that. I think your two-dollar($2) fee is, correct me if I'm wrong, set to take into consideration the impact on residents to begin with. The two dollars ($2) reflects the sensitivity. So I think we need to be awfully careful in compromising the two dollars ($2)to begin with. It's difficult to establish and difficult to administer.The impervious information may be available in the Assessor's Office. It won't take a genius. It might take a lot of work but that is probably intern-level work and cooperation with the Assessor's Office. It might be on the Property Information card and then once that is established, that doesn't change the way income might. I hope we move along with this expeditiously. Committeemember McBride stated, I think one (1) of the things that needs to be considered and I am still concerned with is two dollars ($2) may not be anything for me. But coupled with that, Portage Township lost funding and we are looking at low income residents. We had the electric bill hike that went in this year. The water hike already went in this year. There are other things that are impacting that. So it is not just one (1) single thing that is saying two dollars ($2) or twenty four dollars ($24) a year doesn't impact a person's income because you have other things that affects that person's income. A lot of families are coming from two (2)parent homes or are living in an affluent neighborhood. So all of those things coupled, I think the time of the implementation is going to be key. Now, we are in the winter months. We have people looking at disconnection and things of that nature. And I thank you for considering not implementing it January 1 and delaying it to June, I think that is a great start and where we need to go but there are other factors that people need to consider and say it's only two dollars($2)a month.That is a burden on people. Councilmember White stated,I want to make sure of the next steps.Councilmembers need to email questions to Committee Chair Teshka and Eric? Committee Chair Teshka replied, Just to me. Councilmember White followed up, Ok, I sent some statements and questions to Eric this afternoon and I'll forward those to you.They are pretty much in line with what we were just talking about. Committee Chair Teshka stated, If everybody forwards that stuff to me, I can get that to Eric and Kara. Councilmember White then asked, When is the next time we will be taking action on this? Committee Chair Teshka replied, December 10th, 2018. In the meantime, we could call an additional meeting if need-be. I think, right now, we will plan on having an additional meeting. I know President Scott wants to say something but thank you, Eric, for everything. I look forward to working with you on this. I feel a sense of urgency on this. I didn't think Utilities was going to be my gig when I came in but the more I talk with Jitin and Eric, we have a real problem with our aging infrastructure, as do most cities east of the Mississippi. It's great living in a one hundred fifty two (152) year old City with a rich history but that infrastructure piece is going to be something tricky moving forward and we have to address it.I understand what everybody is saying about wanting to make sure this is an equitable process. We want to make sure we are taking care of our residents who maybe are not as well off. We definitely want to make sure of that and it sounds like they've got an eye toward that. I know in our conversations with you, we have talked EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W Jefferson Bvld South Bend.Indiana 46601 p 574.235.9221 f574.235.9173 TTD574.235.5567 www.southbendin.gov 11 CITY OF SOUTH BEND OFFICE OF THE CLERK about that. Thank you for that. I do feel a sense of urgency on this and there is one (1) thing that is for certain and that is that the issue itself affects everyone equally. How do we pay for that moving forward? I think that is what we are going to continue talking about. We will continue the conversation. Councilmember Scott stated, I know people affected by the last flood and twenty four dollars($24) was definitely something to them. But what has happened is I have seen them lose everything they had and not have the insurance to replace it nor the ability to move. We could see this happen again and again. I think figuring out the income part is crucial. When you lose everything, that is a real concern. Councilmember Broden stated, I appreciate that follow up but it is the non-extraordinary events that are impacting every street in the City of South Bend on this. That will become the new norm and it will only get worse. I guess I want to emphasize that this solution is for what has happened in the last five (5) to ten(10) years. Committee Chair Teshka then opened the floor to members of the public wishing to speak in favor of or in opposition to the legislation. Sue Kesim,4022 Kennedy Drive, stated, I want to address the demographics of our City. Not only the poverty and ALICE, we have a lot of seniors that are having a hard time even meeting their prescriptions. The difference between not paying a gas or electric bill is it doesn't get tacked onto their property tax. When you do these fees, it could get tacked onto their property tax and then we have more people that are going to lose their home. You need to be mindful that this fee could be a tipping point and cause people to lose their homes. We already have that problem. Eric, you had mentioned there are eighty(80)lane miles that are level four(4)or worse that didn't get addressed. I truly appreciate a hard time and I also, during budget,was made aware that you have a$9 million deficit. I was dismayed the Council didn't address that deficit and why it was there. I think there needs to be a pause. I don't think it needs to happen this year, it could go into January or February but there needs to be an audit. I think there are some other things coming out of Eric's budget. There is IT, $600,000 out of Water and $600,000 out of Sewers. There is police equipment. There is stuff coming out, I don't know, I would appreciate an audit of your Council. Not to say you did anything wrong because you didn't, but to see where the money is going and be tighter about making sure it goes to what it's supposed to go to. I think those are concerns to me when I look at those things. Let's right off the bat know those lane miles that need to get done as the budget process starts. Let's start having the Council make priorities. Storm Water is a priority. Fixing the roads is a priority. Making sure the poor neighborhoods that have sewage problems is a priority. Start the budget with priorities and then go with the wants and desires. You know, when I look at you giving a party room to the Zoo and I look at what we need for infrastructure, that priority doesn't match my values. Just saying. So, I want to say I hope that you'll pause, not react right away,do some investigation,crunch some numbers with Eric,make sure the money is going where it needs to and look at that $9 million deficit. I'm sure you need it. Where is it going to come out of? I don't think it should come off the backs of the residents and I think we need to be mindful that we are losing properties because those fees can be added on to the property taxes. Thank you. Committee Chair Teshka then gave the floor to Director Horvath for a Rebuttal. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 I I D574.235.5567 www.southbendin.gov 12 •CITYOFSOU'I'HBEND OFFICE OF THE CLERK Mr. Horvath stated, I appreciate you coming. A lot of entities do focus on the tax parcel itself and, as such,you are right that it would be attached to the property taxes.That is not what this ordinance contemplates. This will be part of the utility bill and that is a different structure. So if you don't pay your utility bill, ultimately we would give notices and then shut the water off or file a lien against your property. Committeemember Davis made a motion to continue Bill No. 61-18 to the December 10th, 2018 meeting of the South Bend Common Council. Committeemember McBride seconded this motion which carried by a voice vote of three (3) ayes. With no further business, Committee Chair Teshka adjourned the Utilities Committee meeting at 5:35 p.m. Re •ectfully Submitted, Letithig-- ake Teshka, Committee Chair EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION i EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 I 10574.235.5567 wwwsouthbendin.gov 13