HomeMy WebLinkAbout11-09-18 Agenda Packet
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MWMC MEETING AGENDA
Friday, November 9, 2018 @ 7:30 a.m.
City of Springfield City Hall, Library Meeting Room
225 Fifth St., Springfield, OR 97477
Turn off cell phones before the meeting begins.
7:30 – 7:35 I. ROLL CALL
7:35 – 7:40 II. CONSENT CALENDAR
a. MWMC 10/19/18 Minutes
Action Requested: By motion, approve the Consent Calendar
7:40 – 7:45 III. PUBLIC COMMENT
Request to speak slips are available at the sign-in desk. Please present request slips to
the MWMC Secretary before the meeting starts.
7:45 – 8:05 IV. EXECUTIVE SESSION – BIOGAS: NW INTERCONNECTION AGREEMENT
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Kristin Denmark/ Josh Newman
Action Requested: The Metropolitan Wastewater Management Commission will now
meet in Executive Session pursuant to ORS 192.660(2)(f) for the purpose of consulting
with legal counsel about information or records exempt from public disclosure because
they are subject to attorney-client privilege.
Adjourn Executive Session and convene Regular Session
Note: Memos presented in Executive Session are confidential and must be turned in at
the end of the meeting.
Action Requested: Discussion and direction on entering into an Interconnection
Agreement with NW Natural.
8:05 – 8:25 V. EUGENE/SPRINGFIELD COLLECTION SYSTEMS PREVENTATIVE MAINTENANCE
AND OPERATIONS UPDATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Brian Conlon/ Rob Hallett
Action Requested: Information Only
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8:25 – 8:45 VI. MWMC FINANCIAL PLAN POLICIES - USER RATES #6 . . . . . . . . . . . . . . . . . . . Meg Allocco
Action Requested: Provide staff with direction to accept or amend proposed policy
language.
8:45 – 9:00 VII. BUSINESS FROM COMMISSION, GENERAL MANAGER, & WASTEWATER DIRECTOR
9:00 VIII. ADJOURNMENT
The meeting location is wheelchair-accessible. For the hearing-impaired, an interpreter can be provided with
48-hours-notice prior to the meeting. To arrange for service, call 541-726-3694.
All proceedings before the MWMC are recorded.
______________________________________________________________________________
M E M O R A N D U M
DATE: November 1, 2018
TO: Metropolitan Wastewater Management Commission (MWMC)
FROM:
Brian Conlon, Springfield DPW Operations Manager
Rob Hallett, Eugene PW Sub-Surface Operations Manager
SUBJECT: Eugene/Springfield Collection Systems Preventative Maintenance and
Operations Update
ACTION
REQUESTED: Information Only
ISSUE
Over the last several years, the cities of Eugene and Springfield have collaborated to develop and
implement local Capacity Management, Operations and Maintenance (CMOM) plans. At the November
9, 2018 MWMC meeting, staff from the two partner agencies will provide a status update on activities
and elements contained within their CMOM plans.
BACKGROUND
CMOM is an industry standard asset management tool that guides fundamental program elements that
support sustainable and responsible management of the cities’ wastewater collection systems. The cities
of Eugene and Springfield each own and operate their respective public wastewater collection and
conveyance systems. Wastewater from Springfield and Eugene is combined and treated in regional
facilities owned and operated by the MWMC in accordance with regulatory requirements described in
the National Pollutant Discharge Elimination System (NPDES) permit jointly held by Springfield, Eugene,
and the MWMC.
In addition to water quality limits and treatment requirements, the NPDES permit contains standard
federal permit conditions related to Sanitary Sewer Overflows (SSOs) that apply to all portions of the
collection system for which the permit holder has ownership and/or operational control. These
provisions include establishing “Duty to Mitigate”, requirements for proper operation and maintenance
of the collection system, noncompliance reporting, and recordkeeping. Collectively, these requirements
result in an NPDES permit obligation for each city to:
Eliminate “avoidable” SSOs
Have a program in place to identify and reduce inflow and infiltration (I/I) into the collection
system.
Memo: Eugene/Springfield Collection Systems Preventative Maintenance and Operations Update
November 1, 2018
Page 2 of 4
Beginning in 2011, staff from Eugene and Springfield discussed CMOM as a strategy that each city could
use to identify future wastewater collection system rehabilitation and repair projects after completion of
projects identified in the Wet Weather Flow Management Plan (WWFMP). CMOM was recognized as an
effective tool for implementing practices needed to address SSO’s, reduce Rainfall Derived Infiltration
and Inflow, provide protection against NPDES permit violations and potential citizen lawsuits, and
ensure collection system capacity into the future.
In 2014, regional wastewater program staff worked with the Commission to develop a CMOM
Framework Document that outlined the Commission’s expectations of the essential elements to be
addressed in a CMOM program approach. In addition to the framework document, each partner agency
performed CMOM gap analyses using the US Environmental Protection Agency (EPA) CMOM Checklist as
a guidance tool.
In 2015, Eugene and Springfield presented to the MWMC on their respective CMOM program. The
program outlines five core areas to direct program improvement strategies: these include Planning,
Design, Construction, Operation and Maintenance, and System Monitoring and Assessment. Although
the cities’ CMOM plans differ in outline form, both embrace the adaptive planning approach with the
same general objective of achieving effective conveyance management, with an over-arching goal of
SSO prevention.
DISCUSSION
Eugene and Springfield Public Works staff have established a strong record of proactive maintenance,
operations and oversight of their wastewater collection systems. Both cities have dedicated substantial
and necessary resources to maintain approximately 800 combined miles of publicly owned sewer pipe.
The cities employ key preventive maintenance and rehabilitation strategies that have paid dividends
toward mitigating SSO frequency and reduction of pipe I/I. The cities’ 5-year SSO-trend shows that
cumulatively the collection systems experienced less than one (1) sanitary sewer overflow per 100 miles
of pipe. This is in the top 90th percentile compared to other utilities across the country.
A key factor in realizing performance objectives has been to schedule work processes that accurately
identify areas within the collection system (manholes, mains, laterals) that have high I/I occurrence for
target Capital Improvement Projects and in-house isolated rehabilitation. Below are some of the vital
work processes that the cities undertake:
Pipe Flow Monitoring
Pipe flow monitoring is an effective analytical tool to evaluate system performance and hydraulic
modeling characteristics. Flow monitoring is vital in estimating the success of I/I reduction accomplished
by rehabilitation/replacement projects. Analyzing pre and post flow data will help quantify the I/I
impacts of private lateral systems. This technical approach is common in the wastewater industry and
the analysis will indicate with better certainty the extent to which private laterals contribute to
conveyance I/I. The data will also provide policy makers a more formative basis toward determining
private lateral next steps. Staff estimates the data gathering process to take approximately two years.
The cities will continue to work with the MWMC and regional partners to evaluate the local/regional
private lateral topic.
Memo: Eugene/Springfield Collection Systems Preventative Maintenance and Operations Update
November 1, 2018
Page 3 of 4
The importance of developing an effective flow monitoring program is central in accomplishing the
objective of reducing system I/I. Recently, Eugene Public Works staff agreed through development of an
Inter-Governmental Agreement to assist Springfield with updating their flow monitoring program. This
project assisted with Springfield’s procurement of 15 new flow monitors that are compatible with
Eugene’s current monitors. The agreement also helped determine optimal monitor deployment
locations, and tapped Eugene staffs expertise toward updating Springfield’s hydraulic computer model
and corresponding planning efforts (such as evaluating present and future capacity conveyance needs).
This joint endeavor has provided Springfield staff a needed boost and builds continuity with the cities’
flow monitoring and system modeling approaches. Ultimately, local rate payers will benefit from
cooperative cost savings.
Flow Monitoring and Capital Rehabilitation Projects
Eugene’s Public Works Engineering Division manages I/I identification and rehabilitation through flow
monitoring and capital rehabilitation projects. Using the flow monitoring data, staff is able to target
areas in the City that have the highest I/I that can be rehabilitated with the available funding. The most
common methods of rehabilitation include cured-in-place pipe lining, manhole sealing and chemical
grouting of laterals. Other methods may also include lateral lining, pipe bursting and reconstruction. In
2018, Eugene rehabilitated approximately 24,000 feet of pipe with cured-in-place pipe lining, as well as
sealed the manholes and lined or grouted the public laterals within the project areas. Engineering
continues to add detail to the model in order to better identify project priorities.
Springfield’s Capital Improvement Program utilizes information from the City’s asset management
program and Operations Division to identify key locations and basins for system rehabilitation and I/I
control. Several methods of rehabilitation are utilized, with the most common being reconstruction (dig
and replace), pipe bursting, and cured-in-place pipe lining. In addition, the City maintains and upgrades
service laterals within the public right of way or easement, typically installing new pipes and
manufactured tees or Inserta Tees to ensure tight residential connections at mainlines. In, 2018
Springfield completed approximately 10,000 linear feet of pipe reconstruction including replacement of
all associated manholes.
Ownership of all sanitary sewer pipes in right-of-way
On January 1, 2017, the City of Eugene formally began taking ownership of all sanitary sewer pipes
located within the City’s right-of-way. This change in ownership has created positive results in how the
City of Eugene provides service to its citizens. First, it provides clarity for Public Works staff to determine
which party is responsible for conducting any necessary repairs to the sanitary sewer service lateral.
Second, it may eliminate the financial burden of a home or business owner to conduct expensive repairs
and replacements if the service lateral is determined to be within the right-of-way (the laterals may be
located deep under streets and sidewalks, or in conflict with other franchise utilities). Third, this program
allows the City of Eugene greater flexibility and opportunity to mitigate/eliminate costly I/I points within
the sanitary sewer collections system.
CONCLUSION
A successful CMOM program is dependent on cities’ staff to attain and maintain a thorough
understanding of the wastewater collection system. With the sunset of the Wet Weather Flow
Management Plan (WWFMP), staff must apply CMOM guidance now and into the future to ensure a
responsible management plan is in place for the oversight of the collection system. Moreover, staff must
Memo: Eugene/Springfield Collection Systems Preventative Maintenance and Operations Update
November 1, 2018
Page 4 of 4
invest in continual process improvement strategies that develop, share, work, and revise the plan. The
cities are invested in using the CMOM framework to provide planning structure, management insight,
and system design and maintenance standards to ensure that core environmental goals and regulatory
compliance is met.
Eugene and Springfield staff recognize the value of sharing expertise and knowledge about business
practices and how the local systems are operated and maintain. Staff continues to meet quarterly to
discuss CMOM initiatives and program implementation strategies, with the goal of being effective
overseers of the collection systems.
ACTION REQUESTED
No action requested at this time.
______________________________________________________________________________
M E M O R A N D U M
DATE: November 1, 2018
TO: Metropolitan Wastewater Management Commission (MWMC)
FROM: Katherine Bishop, ESD Program Manager
Meg Allocco, Accountant
SUBJECT: MWMC Financial Plan Policies - User Rates #6
ACTION
REQUESTED: Consider proposed revisions to the Sewer User Rates and SDC policy language
ISSUE
Based on earlier discussions regarding the 2005 MWMC Financial Plan, including input from the
Commission specific to policies and/or discussion in the Financial Plan, staff is proposing revisions to the
language to update key components of the financial policies.
BACKGROUND
Staff and the Commission have discussed specific policies and/or discussion text in the 2005 Financial
Plan over a series of meetings during the previous year. A summary of these discussions is provided
below for background and context.
At the December 2017 meeting, Staff and the Commission began discussions, including a review of the
financial administration of the Regional Wastewater Program as directed toward achieving the
objectives required by Section 3.f of the MWMC Intergovernmental Agreement (IGA).
In summary, the financial administration objectives include:
1. Establishing revenue adequacy to provide for long-term health and stability of the regional
sewerage facilities through a program of monthly sewer user charges, and system development
charges (SDC) that are imposed uniformly throughout the service area to achieve full cost
recovery
2. Fully funding a program of capital improvements to address capacity, regulatory, and
efficiency/effectiveness needs
3. Ensuring equity between newly connected and previously connected users for their total
Memo: MWMC Financial Plan Policies - User Rates #6
November 1, 2018
Page 2 of 3
contributions toward regional sewerage facilities
4. Ensuring equity among various classes of users based on the volume, strength, and flow rate
characteristics of their discharges together with any other relevant factors
5. Ensuring efficient and cost-effective financial administration of the regional sewerage facilities
6. Complying with applicable laws and regulations including those governing the establishment of
user charges and the establishment of SDCs
At the December 8, 2017 meeting, staff and the Commission reviewed the reserve policies located on
page 12 of the MWMC Financial Plan including: F5a) Working Capital Reserve; F5d) Equipment
Replacement Reserve; and F5j) adding an Insurance Liability Reserve policy.
At the February 9, 2018 meeting, staff provided a chart displaying the flow of regional wastewater funds,
including: (1) sources of funding for reserve funds, (2) individual reserve funds by type, and (3) how each
of the funds and reserves relate to their intended purpose. The presentation included a discussion on
cash reserves in total and per each reserve fund, with input from the Commission.
At the June 8, 2018 meeting, staff provided additional details on reserve funds, incorporating policy
language input from the Commission on the recommended Reserve policy language changes, including:
F5a) Working Capital Reserve; F5b) Operating Reserve; F5c) Capital Reserve; F5d) Equipment
Replacement Reserve; and F5j) Insurance Liability Reserve policy addition.
At the July 13, 2018 meeting, based on discussion and input from the Commission, staff included
language changes to the Asset Management policy language, including policies A2 and A3 and the
discussion on page 18 of the 2005 MWMC Financial Plan.
At the October 19, 2018 rescheduled meeting, staff and the Commission reviewed the Investment and
Portfolio policies, including: Policy 11) regarding cash on hand that is not invested; and Policy 12) the
criteria for MWMC funds that are invested.
DISCUSSION
Current Policy Review and Input – Staff will be discussing sewer user rates and SDCs policies and related
discussions, with the Commission at the November 9, 2018 meeting. The proposed minor revisions to
the MWMC Financial Plan policies include: (1) Policy R4 on the credit rating for the MWMC’ bonds,
including the related Discussion section located on page 16, and (2) the Policy R7 Discussion section on
the mobile wastewater hauler program located on page 17 of the Plan. Proposed revisions are outlined
below, with underline representing additions and strikethrough representing deletions and:
Located on page 16 of the Financial Plan included as Attachment 1 to this memo.
Policy R4 MWMC rate structures shall be sufficient to fully fund reserves, comply with bond
covenants and cover the costs of constructing, operating, rehabilitating, maintaining, and
improving the MWMC assets, while maintaining an un-enhanced credit rating of A+ or greater for
the Commission’s bonds.
Memo: MWMC Financial Plan Policies - User Rates #6
November 1, 2018
Page 3 of 3
Discussion – A rate sufficiency covenant is a standard provision in municipal utility bond
contracts. The covenant requires that rates and charges be set at a level that is high enough to
pay the costs of operating and maintaining the utility. The intent of this policy is to assure that
MWMC rates and charges will be maintained at a level consistent with maintaining an un-
enhanced credit rating of A+ or greater for the Commission’s bonds.
MWMC should strive to maintain rates and charges that provide sufficient financial flexibility to
accomplish strategic objectives for long-term water and biosolids quality, customer satisfaction,
and community support.
Located on page 17 of the Financial Plan included as Attachment 1 to this memo.
Policy R7 Cost of services (direct and indirect) provided to any public or private organizations
by the Regional Wastewater Program shall be recovered through appropriate fees or charges.
Discussion – Historically, cCosts for administering the mobile waste hauler program were are
recovered through rates set on the basis of cost recovery and-state wide market comparisons of
market rates. In 2004, the Commission changed its policy and chose to escalate mobile waste
hauler rates by the same rate as other user rates.
Next Steps – Staff will be updating the narrative from the 2005 Plan to link existing and historical
information to the 2019 Plan. Specifically, the first 10-11 pages including: (1) Introduction and Purpose;
(2) Scope and Methodology; (3) Financing History, and; (4) Financing Options and Strategies.
The MWMC’s Financial Advisor and Bond Counsel are conducting a review of the Financial Plan from a
financial and legal standpoint. The estimated completion date for the updated 2019 Financial Plan is
currently February 2019.
ACTION REQUESTED
Consider the proposed minor revisions to policy language under the Sewer User Rates and SDC Policies
on page 16-17 of the Financial Plan document, and provide staff with input to accept or amend
proposed policy and discussion language.
ATTACHMENT
1. 2005 Financial Plan – Sewer User Rates and SDC Policies
2005 MWMC Financial Plan Page 16
Sewer User Rates and System Development Charges
User rate and SDC policies are intended to guide the Commission in establishing annual rate
structures and approving RWP capital improvement and operating budgets. User rate and SDC
policies shall be directed towards achieving the requirements of IGA Section 3.f.1. - .7.
Policy R1 Monthly sewer user rates, which are the primary source of revenue for the RWP,
are to be equitably allocated to all users based on a cost of service assessment that considers,
among other factors, the volume, strength, and flow rate characteristics of their discharges.
Policy R2 New users of the RWP shall pay an SDC in conformity with the Commission’s
SDC methodology which is adopted consistent with State law.
Discussion: “New users” means users produced from
1. New connections to the existing collection system, including:
a. new single family and multiple unit residential connections; and
b. new commercial or industrial connections;
2. Expansions in activity from existing connections, including:
a. conversion of residential units (single or multiple) to include additional users or
equivalents, or both; and
b. expansions in commercial or industrial activity;
3. Septic to sewer conversions.
Policy R3 Existing and new sewer users shall equitably contribute to recovering all costs
associated with the RWP. To implement this policy, user rate and SDC methodologies will
consider wastewater quantity, quality, and strength, consistent with State law.
Policy R4 MWMC rate structures shall be sufficient to fully fund reserves, comply with
bond covenants and cover the costs of constructing, operating, rehabilitating, maintaining, and
improving the MWMC assets, while maintaining an un-enhanced credit rating of A for the
Commission’s bonds.
Discussion – A rate sufficiency covenant is a standard provision in municipal utility bond
contracts. The covenant requires that rates and charges be set at a level that is high enough to
pay the costs of operating and maintaining the utility. The intent of this policy is to assure that
MWMC rates and charges will be maintained at a level consistent with maintaining an un-
enhanced credit rating of A for the Commission’s bonds.
MWMC should strive to maintain rates and charges that provide sufficient financial flexibility to
accomplish strategic objectives for long-term water and biosolids quality, customer satisfaction,
and community support.
Policy R5 The Commission will attempt to adopt user rates that provide multi-year stability.
Discussion – A multi-year rate schedule establishes user rates that are applicable over several
years. They may be the same each year, or change at some frequency. A Rate Stability Reserve
shall be maintained to ensure that adequate funds are available to sustain the rate through
completion of the rate cycle.
ATTACHMENT 1
2005 MWMC Financial Plan Page 17
The General Manager shall prepare and submit to the Commission a report in support of the
scheduled or proposed monthly sewer rates for the next year, including the following
information:
key financial assumptions such as inflation,
bond interest rates,
investment income,
size and timing of bond issues,
the considerations underlying the projection of future growth in residential customer
equivalents,
all key projections, including the annual projection of operating and capital costs, debt
service coverage, cash balances, revenue requirements, revenue projections and a
discussion of significant factors that impact the degree of uncertainty associated with the
projections, and
a discussion of the accuracy of the projections of costs and revenues from previous recent
budgets.
Policy R6 Costs of existing and future capacity for new customers shall be recovered by
SDCs that are based on the cost of existing and required new capacity in conformance with the
Commission’s SDC methodology.
Discussion – The Commission should periodically review the SDCs to ensure that equity is
established between newly connected and previously connected users for their total contributions
toward the Regional Sewerage Facilities.
Policy R7 Costs of services (direct and indirect) provided to any public or private
organizations by the RWP shall be recovered through appropriate fees or charges.
Discussion – Historically, costs for administering the mobile waste hauler program were
recovered through rates set on the basis of state-wide market comparison. In 2004, the
Commission changed its policy and chose to escalate mobile waste hauler rates by the same rate
as other user rates.
ATTACHMENT 1