Title
Water System Plan Update
Recommended Action
UAC Deliverable:
Receive information and provide input to staff
Report
Issue:
Staff requested updating UAC on the status of the 2015-2020 Water System Plan, which sets the strategic direction for the Drinking Water Utility. As follow-up to previous UAC interest and recent amendments to the reclaimed water ordinance, staff will share plans to re-evaluate the reclaimed water financial structure.
Staff Contact:
Laura Keehan, Senior Planner, Public Works Water Resources, 360.753.8321
Presenter(s):
Laura Keehan, Water System Plan Coordinator
Donna Buxton, Senior Reclaimed Water Program Specialist
Background and Analysis:
The City is in the process of updating the 2015-2020 Water System Plan as required by the Washington State Department of Health (DOH) every six years. The current plan expires in June 2016. This utility master plan sets the strategic direction for the Drinking Water Utility by identifying goals, objectives, strategies and costs for 6- and 20-year periods. The plan addresses water demand forecasts and capital investments, operations and maintenance, financial strategies, groundwater protection, water quality, and water conservation (which includes reclaimed water). The scope of the plan was discussed with UAC in April 2013; since then, the schedule has been updated (Attachment 1).
The Reclaimed Water Program is part of the Drinking Water Utility. Reclaimed water is generated at the LOTT Budd Inlet wastewater treatment/reclaimed water facility and distributed by the City for irrigation, toilet flushing, and other beneficial uses. Olympia Municipal Code 13.24 Reclaimed Water, amended in late 2013, contains new revenue streams for reclaimed water, effective January 2014. Prior to the amendment, the City charged only for reclaimed water used for irrigation, at 70% the drinking water irrigation rate. The amendment added rates for indoor use of reclaimed water, plan review fees, permitting fees, construction fees, and service charges. The rate for indoor use is now 70% of the drinking water tiered rate structure. The reclaimed water fees and charges are now consistent with those for the drinking water, wastewater, and storm water utilities. As an incentive in addition to the reduced (70%) rate, the City continues not to collect General Facilities Charges (GFCs) for reclaimed water meters (Attachment 2).
The City has collected $244,475 for almost 60 million gallons of reclaimed water used between January 2005 and March 2014. The City did not charge customers for the first three years of use; thus, the average annual revenue is $40,272. The Reclaimed Water Program is implemented by about 0.5 FTE (about $51,500) in staff resources and has an average annual operating budget (2011-2014) of about $8,887; available, but typically not spent year to year. Therefore, revenue from reclaimed water sales nearly supports the cost of the program.
LOTT does not charge the City to generate the reclaimed water (which the City then sells). Generation is fully subsidized by LOTT and the City's wastewater utility charges. Although the City supports the advancement of this water-conserving resource, the cost of expanding the distribution system is exorbitant. Past discussions with UAC have touched on the collection of GFCs and the appropriate allocation of costs between the drinking water utility, the wastewater utility, and LOTT charges.
Neighborhood/Community Interests (if known):
The public process required by Council and DOH will be implemented as part of adopting the 2015-2020 Water System Plan. The 2013 amendments to the Reclaimed Water Ordinance received support by City reclaimed water customers, the local business community, LOTT, and neighboring jurisdictions through the amendment adoption public process.
Options:
As part of addressing Water System Plan work items relating to rates and finances, staff is seeking UAC's position on the subsidizing of reclaimed water. Staff is particularly interested in GFCs and the appropriate allocation of reclaimed water costs.
Financial Impact:
Any UAC recommendations on reclaimed water financing and cost allocations will be vetted through the Water System Plan process and may result in water utility budget implications.