HomeMy WebLinkAbout11-112MARCH 8, 2011 11 -112 RESOLUTION
(CARRIED 7 -0 LOST LAID OVER WITHDRAWN )
PURPOSE: ESTABLISH 2011 STORM WATER UTILITY RATE
TO $72.36/ERU
INITIATED BY: DEPARTMENT OF PUBLIC WORKS
WHEREAS, the City of Oshkosh has previously established a Stormwater Utility;
and
WHEREAS, Section 24.14 (C)(2)(b) of the Oshkosh Municipal Code gives the
Common Council authority to establish the Equivalent Runoff Unit (ERU) charge for the
Utility.
NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of
Oshkosh that the Equivalent Runoff Unit (ERU) charge for 2011 shall be $72.36/ERU.
BE IT FURTHER RESOLVED that the appropriate City officials are authorized
and directed to take those steps necessary to implement this charge to become
effective for services provided on and after April 1, 2011.
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ON THE WATER
MEMORANDUM
TO: Honorable Mayor and Members of the Common Council
FROM: Steven M. Gohde, Assistant Director of Public Works
DATE: March 2, 2011
RE: Storm Water Utility Rate Increase
BACKGROUND
The City of Oshkosh implemented a Storm Water Utility in 2003 to fund improvements to the City's storm
water management facilities. Based on the initial Storm Water Utility study completed in September of
2002 the Common Council implemented a phased introduction of the rates. The rate was initially set at
$19.10 per Equivalent Runoff Unit (ERU) per year for one half of 2003. There were three subsequent
rate increases, the most recent being to $62.92 per ERU per year in 2009. The Storm Water Utility has
funded several projects to date including the Fair Acres detention basin, Anchorage Channel
Construction, the Baldwin Avenue area dry detention basin, Tipler School area dry detention basin, North
High School area wet detention basin and Oakwood Road wet detention basin.
The City has experienced significant flooding during rain storms in 1990, 1993, 1996, 1999, 2001, 2004,
2008 and 2010. Localized areas also flood during smaller events. In addition, the City is now under a
permit (MS4) from the DNR, as mandated by the EPA Clean Water Act, for discharge of storm water.
This permit requires the implementation of multiple items to reduce the amount of pollutants entering
lakes and rivers. The largest expense item in the permit is reducing the Total Suspended Solids (TSS)
generated by the City as a whole by 20% in 2008 and 40% by 2013. We have met the 20% goal.
AECOM was hired by the City to develop a City wide plan for pollution reduction. The City has also
completed several flood studies in the past and is currently studying several watersheds to develop plans
to reduce flooding in combination with pollution control. City staff, based on information from all studies,
developed a schedule of work needed to reduce flooding and implement pollution control measures.
The schedule calls for approximately two detention basins to be constructed per year with an emphasis
on flood control. Where ever possible, pollution control measures will be implemented with flood control
measures.
ANALYSIS
The City hired AECOM to perform a rate analysis to implement the projects outlined in the schedule, to
implement other Capital Improvement Projects, and to fund operational costs. In order to support these
activities, a rate of $72.36 per ERU per year is recommended. This rate will allow the City to complete all
of the projects listed in the Capital Improvement Program (CIP) — Storm Sewer Section and also maintain
daily operations. The rate is proposed to be in effect from April 2011 through 2012. The rate is able to
be held constant through 2012 by applying reimbursed grant funds and cash reserves of the Storm Water
Utility to the expenses anticipated for 2012. Finance Director Steeno has reviewed the cash reserves and
concluded the Storm Water Utility can reduce its reserves to stabilize the utility rate. Even with this
1 AEngineeringAStorm Water InformationA201 I rate study memo. doc
action, the Utility is able to retain adequate reserves to maintain favorable bond ratings and meet the
operating needs of the utility. The Storm Water Utility Committee reviewed the proposed rate increase
and recommended approval of the rate based on the needs of the community to address flooding and
pollution control requirements.
In the event grants or other monies are secured at more favorable rates than anticipated in the study, the
rate increases for future years can be offset. The intent is to review the rate annually to incorporate
actual construction costs from the previous year and incorporate other funds that became available to the
utility. Attached is a 3 year projection of the Storm Water Utility rates.
FISCAL IMPACT
The rate of $72.36 per ERU per year is required to implement all of the projects and operations in the
2011 budgets. Any reduced rate increase will result in some projects listed in the CIP being postponed
until future years. Pushing projects to future years will result in less reduction of flooding during
significant rain events prior to project completion and will delay reaching the 40% TSS reduction goal.
RECOMMENDATIONS
The Storm Water Utility Committee recommends a rate increase to $72.36 per ERU per year. The
Department of Public Works and Finance Department agree with the recommendation. It is
recommended that the rate go into effect on April 1, 2011. The effect of the increase in April equates to a
total cost of $70.00 per ERU for 2011.
Respectfully Submitted,
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Steven M. Gohde
Asst. Director of Public Works
Approved:
City Manager
L\Engineering\Storm Water Information1201 1 rate study memo.doc
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