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REGULAR MEETING MARCH 27, 2017
<br />Mr. Horvath responded, No, but in all honesty, we would update the plan. We will look at this in
<br />three (3) or four (4) years, and then we'll sit back down and do a whole other update, and we will
<br />do interim ones inbetween. I can pretend like we've got the greatest plan ever, and that we know
<br />that everything is going to fail, but it won't fail like we think it will. I feel that this does meet the
<br />critical needs over the next five (5) to six (6) years.
<br />Councilmember Dr. Varner asked, Recognizing that you still expect that there will be another
<br />$66,000,000 of improvements that need to be made, assuming that Arcadus was accurate in their
<br />assessments —so beginning in year six (6)...?
<br />Mr. Horvath responded, And there may be additional stuff that comes online by that time -
<br />Councilmember Dr. Varner interjected, I think that's one of the concerns that we both have —
<br />Mr. Horvath interjected, Trust me: if we won the lottery tomorrow, and there was $100,000,000,
<br />I guarantee my staff could find good places to put that money into your water utility.
<br />Councilmember Dr. Varner asked, Would it be fair to say, then, that if we utilized this —which is
<br />probably the best summary that we've had so far —that there does not appear to be a need for an
<br />additional rate increase after the six (6) years?
<br />Mr. Horvath responded, I believe these are the most critical needs, right now.
<br />Councilmember Dr. Varner asked, Do you expect this to fund us for six (6) years?
<br />Mr. Horvath responded, Yes, however, we're not replacing very many water mains, we're not
<br />replacing any hydrants, we're not replacing MVa valves. There's a lot of unfunded stuff that if
<br />you've got the ability to fund, it's going to have a need.
<br />Councilmember Dr. Varner asked, What are our options to fund those?
<br />Mr. Horvath responded, Due to operation maintenance, we do have funds available. Honestly,
<br />we will fix it when it breaks.
<br />Councilmember Dr. Varner stated, I have a great deal of confidence in the abilities of the
<br />Engineering and Public Works Departments to manage the necessary deals. That is the nature of
<br />my questions. I do, however, know that we will be looking at some sort of sewer increases in the
<br />not - too - distant future related to the CSO project, even if it improves. When we talk to our
<br />constituents, if there is consideration of a forty -three percent (43 %), under some circumstances,
<br />I'd like to be able to say, with confidence, that this is the last time we look at this for six (6)
<br />years, because we looked at everything in detail very thoroughly and we believe that we can
<br />make this plan work as proposed.
<br />Mr. Horvath stated, This will meet the most critical needs we have over the next six (6) years,
<br />under current conditions.
<br />Councilmember Oliver Davis asked Mr. Horvath what year Public Works first informed the
<br />Administration that the water infrastructure needed so many improvements.
<br />Mr. Horvath responded, It's been roughly five (5) years. We started looking at the operations and
<br />we recognized that we had needs. We had needs everywhere, and we've talked about a lot of
<br />those needs. The one that was most prevalent and in our face was the need to increase the waste
<br />water rates, which we went through, because of a consent decree that was signed that cost
<br />$500,000,000, but in today's dollars that was $750,000,000. Significantly more than what we're
<br />talking about here. Mr. Horvath explained that they tried to find a way to keep water rates as
<br />cheap as possible for water customers and hold off on a rate increase for as long as possible. In
<br />the first two (2) years, they looked at the City's pumping facilities and looked at the cost of
<br />pumping water at each of the facilities to determine whether certain ones should be
<br />decommissioned or not. After that, they conducted this study, and after that a rate increase on
<br />capital needs. He stated that the issue wasn't quite critical before because the City wasn't at
<br />40,000 gallons. Now, there are critical needs.
<br />Councilmember Davis stated that John Julien of Umbaugh and Associates, in his breakdown of
<br />the financial challenges facing the City regarding the water utility, used the term "illegal" in
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