BOARD MEETING AGENDAS
PLATTE CANYON WATER AND SANITATION DISTRICT
JOINT MEETING OF THE PLATTE CANYON AND SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICTS
SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT
March 24, 2017 - 8:30 a.m. Platte Canyon/Southwest Metropolitan District Office 8739 W. Coal Mine Avenue Littleton, Colorado 80123
PLATTE CANYON WATER AND SANITATION DISTRICT
Action Items
PCA.1 Approval of Agenda PCA.2 Approval/Ratification of Accounts Payable (tab 1) PCA.3 Ratification of Investment/Deposit Transactions (tab 2) PCA.4 Acceptance of Audit for 2016 (tab 3)
Information - Discussion Items
New Business
Adjournment
JOINT MEETING – PLATTE CANYON/SOUTHWEST METROPOLITAN
Action Items
JA.1 Approval of Agenda JA.2 Approval of Minutes for the February 24, 2017 Joint Regular Meeting (tab 4)
Page 1 Information - Discussion Items
JI.1 Platte Canyon Financial Statements (tab 5) JI.2 Southwest Metropolitan Financial Statements (tab 6) JI.3 Platte Canyon Investment/Deposit Report (tab 7) JI.4 Southwest Metropolitan Investment/Deposit Report (tab 8) JI.5 Manager’s Report (tab 9) JI.6 Operations Report (tab 10) JI.7 Construction Project Report (tab 11)
New Business
Meeting Schedule
The next meeting is scheduled for April 21, 2017, the third Friday of April.
SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT
Action Items
SWMA.1 Approval of Agenda SWMA.2 Approval/Ratification of Accounts Payable (tab 12) SWMA.3 Ratification of Investment/Deposit Transactions (tab13) SWMA.4 Acceptance of Audit for 2016 (tab 14) SWMA.5 Approval of Resolution 2017-3-1 Ordering the Inclusion of the Wild Plum Farm Property (tab 15)
Information - Discussion Items
New Business
Page 2 Platte Canyon Water & Sanitation District Checklist for the Month of March 2017
Ck. No. Payee Description Amount Net Amount
ACH Patrick Fitzgerald Payroll 3/3/17 $4,611.19 ACH Scott Hand Payroll 3/3/17 $2,183.16 ACH Bruce Yarish Payroll 3/3/17 $1,276.75 ACH Armando Quintana Payroll 3/3/17 $2,076.67 ACH John Mathias Payroll 3/3/17 $2,110.49 ACH Justin Roquemore Payroll 3/3/17 $1,168.03 ACH Cory Taylor Payroll 3/3/17 $1,390.37 ACH Michael Chavez Payroll 3/3/17 $1,267.64 ACH Alyssa Quinn Payroll 3/3/17 $1,657.85 ACH Barrie Brinkley Payroll 3/3/17 $1,103.65 ACH Vanessa Shipley Payroll 3/3/17 $1,891.70 ACH Tony Cocozzella Payroll 3/3/17 $2,430.98 ACH Adam Morse Payroll 3/3/17 $1,016.89 ACH CCOERA 401/457 contributions & loan payments $7,282.92 EFTPS Electronic Federal Tax Payment FICA & Fwt $10,437.40 EFTPS Electronic State Tax Payment State Withholding $2,777.00
031033 Professional Answering Service Answering service $60.71 031034 First Choice Coffee Service Office supplies $127.45 031035 Alameda Water & Sanitation Dist. Professional development $720.00 031036 All Copy Products Office supplies $140.00 031037 AV-Tech Electronics, Inc. Vehicle maintenance $685.80 031038 CenturyLink $997.95 Pump station telemetry 393.83 Backcharge COL 60.41 Backcharge SWM 543.71 031039 Denver Water Maintenance supplies - sewer $559.36 031040 G&S Auto Parts, Inc. Vehicle maintenance $5.96 031041 W.W. Grainger, Inc. Maintenance supplies - sewer $732.91 031042 Home Depot Maintenance supplies $652.60 031043 KCM Consulting Services, Inc. Professional development $750.00 031044 Logic Integration, Inc. Office supplies $130.00 031045 Market Direct, Inc. Newsletter $1,489.00 031046 John Mathias Medical deductible reimbursement $42.97 031047 McCauley Cinstructors Hydrant deposit $350.00 031048 Metro Pavers, Inc. Water contract emergencies $850.00 031049 North Star, Inc. Software management $693.00 031050 Staples Advantage Office supplies $90.29 031051 Precision Auto Glass LLC Vehicle maintenance $338.77 031052 Rocky Mountain Catering Miscellaneous $251.25 031053 Southwest Metro W&S District Building lease $600.00 031054 Utility Notification Center Utility notification $278.40 W00361 Wells Fargo Remittance Center $4,689.92 Vehicle maintenance 728.29 Books and magazines 761.08 Office supplies 371.52 Professional development 2,529.05 Software management 299.98
TOTAL CHECKS/ACH AS OF MARCH 17, 2017 $59,919.03 Platte Canyon Water & Sanitation District Supplemental Checklist for the Month of March 2017
Ck. No. Payee Description Amount Net Amount
ACH Patrick Fitzgerald Payroll 3/20/17 $4,599.56 ACH Scott Hand Payroll 3/20/17 $2,722.86 ACH Bruce Yarish Payroll 3/20/17 $1,841.98 ACH Armando Quintana Payroll 3/20/17 $2,504.34 ACH John Mathias Payroll 3/20/17 $2,118.59 ACH Justin Roquemore Payroll 3/20/17 $1,412.01 ACH Cory Taylor Payroll 3/20/17 $1,502.13 ACH Michael Chavez Payroll 3/20/17 $1,639.81 ACH Alyssa Quinn Payroll 3/20/17 $2,011.46 ACH Barrie Brinkley Payroll 3/20/17 $1,336.54 ACH Vanessa Shipley Payroll 3/20/17 $1,891.70 ACH Tony Cocozzella Payroll 3/20/17 $2,430.98 ACH Adam Morse Payroll 3/20/17 $1,227.62 ACH CCOERA 401/457 contributions & loan payments $7,933.44 EFTPS Electronic Federal Tax Payment FICA & Fwt $12,293.45
031055 Anthony Dursey Director fee $92.35 031056 William Buckner Director fee $92.35 031057 Richard Rock Director fee $92.35 031058 Louis Fohn Director fee $92.35 031059 George E. Hamblin, Jr. Director fee $92.35
031060 Tyco Integrated Security LLC Pump station utilities $245.61 031061 Alyssa Quinn Professional development $58.10 031062 American Backflow, LLC Sewer maintenance and operation $190.93 031063 C&L Water Solutions, Inc. Water contract emergencies $4,769.60 031064 Clement Communications Books and magazines $202.60 031065 Colorado Litho, Inc. Newsletter $1,220.72 031066 Collins Cockrel & Cole Legal fees $2,007.00 031067 Occupational Health Centers Maintenance supplies $94.00 031068 Dewberry Engineers Inc. SJM Pump Station Improvements $20,491.62 031069 Englewood Lock & Safe Pump station maintenance $97.00 031070 Richard H. Cassens $8,660.00 Normandy Estates Rehabilitation - 2017 4,000.00 S. Morning Glory Ln. Replacement 4,660.00 031071 Glacier Construction Co, Inc. SJM Pump Station Improvements $93,452.45 031072 Jefferson County Water contract emergencies $175.00 031073 Landmark Lincoln Vehicle maintenance $20.96 031074 Market Direct, Inc. Newsletter $347.53 031075 Merrick & Company, Inc. Engineering - GIS $2,760.13 031076 Pinnacol Assurance Workers comp $2,375.00 031077 Cintas First Aid & Safety Office supplies $158.03 031078 Schilling & Company, Inc. Audit fee $7,000.00 031079 Sprint Mobile phones $1,547.12 031080 Telog Instruments, Inc. Software management $1,999.00 031081 Transwest Truck Trailer RV Vehicle maintenance $462.80 031082 Vectors, Inc. Other Equipment - GPS Unit $18,492.10 031083 Vision Service Plan Vision insurance $336.35 031084 Xcel Energy Pump station utilities $138.27 W00362 AFLAC Employee accidental insurance $747.70 W00363 Delta Dental Plan of Colorado Dental insurance $1,527.03 W00364 United HealthCare of Colo. Medical insurance $16,802.97 W00365 UNUM Life Insurance Life and disability $1,407.38 W00366 WEX Bank Fuel expense $1,472.77 Total Supplemental Checks/ACH as of March 24, 2017 $237,187.99
TOTAL CHECKS/ACH PAID FOR THE MONTH OF MARCH 2017 $297,107.02 Platte Canyon Water & Sanitation District Schedule of Investment Principal Activity Month of: FEBRUARY, 2017
Date Date of Number Face/ Face Purchase Purchased Purchased Redemption Purchased Maturity of Days Principal Rate Price Interest Yield Yield Totals (Wt. Avg.) (Wt. Avg.) (Wt. Avg.) (Wt. Avg.) (Wt. Avg.)
NEW PURCHASES
0 0.00 0.00 0 0.00 0 0.00 0 -
Average days/Weighted average rate 0 0.0000% 0.0000 0.00 0.00 0.0000% Total new purchases $0.00 $0.00
REDEMPTIONS
0 0.00 0 0.00 0 0.00 0 0.00
Average days/Weighted average rate 0 0.0000% 0.0000 0.00 0.0000% Total redemptions $0.00 $0.00
RENEWALS
0 0 0 0
Total renewals $0.00
$0.00
NOTE: All redemptions are wired to checking account at Wells Fargo Bank West of Littleton or to the UMB Trust account.
March 24, 2017
To the Board of Directors Platte Canyon Water and Sanitation District Arapahoe and Jefferson Counties, Colorado
We have audited the financial statements of the governmental activities, the business-type activities, and each major fund of Platte Canyon Water and Sanitation District for the year ended December 31, 2016, and have issued our report thereon dated March 24, 2017. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards as well as certain information related to the planned scope and timing of our audit.
Responsibilities under U.S. Generally Accepted Auditing Standards
As stated in the engagement letter, our responsibility, as described by professional standards, is to express opinions about whether the financial statements prepared by management with your oversight are fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles. Our audit of the financial statements does not relieve you or management of your responsibilities.
Generally accepted accounting principles provide for certain required supplementary information (RSI) to supplement the basic financial statements. Our responsibility with respect to the required supplementary information, which supplements the basic financial statements, is to apply certain limited procedures in accordance with generally accepted auditing standards. However, the RSI will not be audited and, because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance, we will not express an opinion or provide any assurance on the RSI.
We have been engaged to report on supplemental information, which accompany the financial statements but are not RSI. Our responsibility for this supplementary information, as described by professional standards, is to evaluate the presentation of the supplementary information in relation to the financial statements as a whole and to report on whether the supplementary information is fairly stated, in all material respects, in relation to the financial statements as a whole.
We have not been engaged to report on other information, which accompany the financial statements but are not RSI. Our responsibility with respect to this other information in documents containing the audited financial statements and auditor’s report does not extend beyond the financial information identified in the report. We have no responsibility for determining whether this other information is properly stated. This other information will not be audited and we will not express an opinion or provide any assurance on it.
1
Planned Scope and Timing of Audit
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested.
Our audit will include obtaining an understanding of the entity and its environment, including internal control, sufficient to assess the risks of material misstatement of the financial statements and to design the nature, timing, and extent of further audit procedures. Material misstatements may result from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or governmental regulations that are attributable to the entity or to acts by management or employees acting on behalf of the entity. We will generally communicate our significant findings at the conclusion of the audit. However, some matters could be communicated sooner, particularly if significant difficulties are encountered during the audit where assistance is needed to overcome the difficulties or if the difficulties may lead to a modified opinion. We will also communicate any internal control related matters that are required to be communicated under professional standards.
The audit was performed in February 2017, and we issued our report on March 24, 2017.
Significant Audit Findings
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the District are described in Note 2 to the financial statements. For the year ended December 31, 2016 the District implemented the following Governmental Accounting Standards Board Statement:
• During the year ended December 31, 2016, the District implemented Government Accounting Standards Board Statement No. 72 – Fair Value Measurement and Application. Under Statement No. 72, the District categorizes the fair value measurements of its investments based on the hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
We noted no transactions entered into by the District during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. There were no accounting estimates that are considered particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected.
There were no financial statement disclosures that are particularly sensitive because of their significance to financial statement users. The disclosures in the financial statements are neutral, consistent, and clear.
2
Difficulties Encountered in Performing the Audit
We encountered no difficulties in dealing with management in performing and completing our audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. There were no material misstatements identified during the audit.
Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that there were no such disagreements during the course of the audit.
Management Representations
We have requested certain representations from management that are included in the management representation letter dated March 24, 2017.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the governmental unit’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the governmental unit’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition of our retention.
Other Matters
We applied certain limited procedures to required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
3
We were engaged to report on supplementary information, which accompanies the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.
We were not engaged to report on other information, which accompanies the financial statements but is not RSI. We did not audit or perform other procedures on this other information and we do not express an opinion or provide any assurance on it.
Restriction on Use
This information is intended solely for the use of the Board of Directors and management of the District and is not intended to be and should not be used by anyone other than these specified parties.
Very truly yours,
4
PLATTE CANYON WATER AND SANITATION DISTRICT Arapahoe and Jefferson Counties, Colorado
FINANCIAL STATEMENTS For the Year Ended December 31, 2016
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS’ REPORT ...... I
MANAGEMENT’S DISCUSSION AND ANALYSIS...... 1
BASIC FINANCIAL STATEMENTS
Government-wide Financial Statements Statement of Net Position ...... 8 Statement of Changes in Net Position ...... 9
Fund Financial Statements Governmental Fund Financial Statements Balance Sheets ...... 10 Statement of Revenues, Expenditures, and Changes in Fund Balances ...... 11 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Changes in Net Position...... 12 Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual: Special Revenue Fund - Subdistrict No. 1 ...... 13 Special Revenue Fund - Subdistrict No. 2 ...... 14
Proprietary Fund Financial Statements Statement of Net Position ...... 15 Statement of Revenues, Expenses and Changes in Fund Net Position ...... 16 Statement of Cash Flows ...... 17
Notes to Financial Statements ...... 19
SUPPLEMENTARY INFORMATION
Schedule of Operating Expenses - Enterprise Fund ...... 34 Schedule of Revenues, Expenditures and Changes in Funds Available – Budget and Actual (Non-GAAP Budgetary Basis) - Enterprise Fund ...... 35 Reconciliation of Actual (Non-GAAP Budgetary Basis) to Statement of Revenues, Expenses and Changes in Net Position - Enterprise Fund ...... 36
OTHER INFORMATION
Schedule of Debt Service Requirements to Maturity- Governmental Activities Long-Term Obligations ...... 37
Independent Auditor’s Report
Board of Directors Platte Canyon Water and Sanitation District Arapahoe and Jefferson Counties, Colorado
We have audited the accompanying financial statements of the governmental activities, the business-type activities, and each major fund of Platte Canyon Water and Sanitation District (District) as of and for the year ended December 31, 2016, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
I
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, and each major fund of Platte Canyon Water and Sanitation District, as of December 31, 2016, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparisons for the Special Revenue Funds for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other-Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 1 through 7 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District’s financial statements as a whole. The supplementary information listed in the table of contents is presented for purposes of additional analysis and are not a required part of the financial statements.
The supplementary information is the responsibility of management and was derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Prior-Year Comparative Information
We have previously audited the District's 2015 financial statements, and we expressed unmodified audit opinions on the respective financial statements of the governmental activities, the business-type activities, and each major fund in our report dated February 26, 2016. In our opinion, the summarized comparative information presented herein as of and for the year ended
II
December 31, 2015, is consistent, in all material respects, with the audited financial statements from which it has been derived.
The other information listed in the table of contents has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on it.
Highlands Ranch, Colorado March 24, 2017
III
PLATTE CANYON WATER AND SANITATION DISTRICT MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31, 2016
This discussion and analysis is designed to provide an analysis of the District’s financial condition and operating results and to inform the reader on the District’s financial issues and activities.
The Management’s Discussion and Analysis (MD&A) should be read in conjunction with the District’s financial statements.
FINANCIAL HIGHLIGHTS
• The District remains in strong financial position with assets exceeding liabilities and deferred inflows of resources at the close of 2016 by $19,918,219. Of this amount, $9,954,702 or 50.0% is unrestricted and may be used to meet the District’s ongoing obligations to citizens. • Total net position increased $285,976 or 1.5 %.
OVERVIEW OF THE FINANCIAL STATEMENTS
The discussion and analysis is intended to serve as an introduction to the Platte Canyon Water and Sanitation District’s basic financial statements. The District’s basic financial statements comprise three components: 1) the government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains supplementary information and other information in addition to the basic financial statements themselves.
Government–wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the Platte Canyon Water and Sanitation District’s finances, in a manner similar to private-sector business.
The Statement of Net Position presents information on all of the District’s assets and liabilities, deferred inflows of resources and net position. Over time, increases or decreases in the net position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating.
The Statement of Changes in Net Position presents information which reflects how the District’s net position changed during the past year. All changes in the net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported in the statement for some items that will only result in cash flows in future fiscal periods. (e.g., earned but unused compensated absences).
1
Both of the government-wide financial statements distinguish functions of the District that are principally supported by taxes (Governmental Activities) from other functions that are intended to recover all or a significant portion of their costs through taxes and contract services (Business-type Activities). The Governmental Activities of the District include the financing and construction of certain water and sewer system improvements of the blended component units. The Business-type Activities of the District include the effective and economical operation of water and sewer systems.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. Some funds are required to be established by state law and bond covenants. All of the District funds can be divided into two categories: Governmental Funds and Proprietary Funds.
Governmental Funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for the governmental funds with similar information presented for governmental activities in the governmental-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near term financing decisions. Both the governmental funds balance sheet and the governmental funds statement of revenue, expenditures, and changes in funds balance provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The District maintains two individual governmental funds, both of which are considered major funds. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenue, expenditures, and changes in fund balances.
Proprietary Funds – When the District charges entities for the services it provides, these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position and the Statement of Changes in Net Position. In fact, the District’s enterprise fund (a component of proprietary funds) is the same as the business-type activities reported in the government-wide statements, but provides more detail and additional information, such as a cash flow statement.
Notes to Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the financial statements.
2
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the District, assets exceeded liabilities by $19,918,219 at the close of 2016.
Net position
Combined Net Position of the Platte Canyon Water and Sanitation District at December 31, 2016 and 2015 were:
Governmental Business-type Total Primary Activities Activities Government 2016 2015 2016 2015 2016 2015 Current assets and other assets $ 99,093 $ 94,819 $ 12,734,176 $ 12,720,979 $ 12,833,269 $ 12,815,798 Capital assets - - 9,835,550 9,282,609 9,835,550 9,282,609 Total assets 99,093 94,819 22,569,726 22,003,588 22,668,819 22,098,407
Long-term obligations 479,851 519,056 274,936 235,923 754,787 754,979 Other liabilities 42,331 41,292 415,282 124,293 457,613 165,585 Total Liabilities 522,182 560,348 690,218 360,216 1,212,400 920,564
Deferred property tax revenue 57,500 57,600 1,480,700 1,488,000 1,538,200 1,545,600 Total deferred inflows of resources 57,500 57,600 1,480,700 1,488,000 1,538,200 1,545,600
Net Position: Net investment in capital assets - - 9,835,550 9,282,609 9,835,550 9,282,609 Restricted 38,467 33,748 89,500 82,500 127,967 116,248 Unrestricted (519,056) (556,877) 10,473,758 10,790,263 9,954,702 10,233,386 Total net position $ (480,589) $ (523,129) $ 20,398,808 $ 20,155,372 $ 19,918,219 $ 19,632,243
A significant portion (49.4%) of the District’s net position reflects its net investment in capital assets (e.g. land, water and sewer systems, equipment, etc.). The District uses these capital assets to provide services to citizens; consequently these assets are not available for future spending. Unrestricted net position may be used to meet the District’s ongoing obligations to maintain the water and sewer systems within the jurisdictional boundaries. Unrestricted net position makes up 50.0% of total net position.
Platte Canyon Water and Sanitation District Subdistrict No. 1 (Subdistrict No.1) and Platte Canyon Water and Sanitation District Subdistrict No. 2 (Subdistrict No. 2) financed the construction of water distribution system improvements which were conveyed to the District when completed. The related outstanding debt will be repaid with tax levies on property located within each Subdistrict. Negative net position will be reported for the Governmental Activities until the long- term debt obligation is satisfied. The District is not obligated to repay the debt in any way. Additional information regarding the Subdistricts may be found in Note 1 (Blended Component Units) of this report. 3
Changes in Net position
The District’s program and general revenue of $3,072,377 is more than program expenses of $2,786,401 by $285,976. This increase is more favorable than the decrease in net position in 2015 of $11,979 primarily due to the increase in contract services and property tax revenue.
The table below shows the summarized revenue and expenses for 2016 and 2015.
Governmental Business-type Total Primary Activities Activities Government 2016 2015 2016 2015 2016 2015 Program revenue: Charges for services $ - $ - $ 1,319,558 $ 1,262,352 $ 1,319,558 $ 1,262,352 Capital contributions - - 2,000 124,800 2,000 124,800 General revenue: Property taxes 57,780 57,549 1,484,559 1,254,253 1,542,339 1,311,802 Specific ownership tax 4,634 4,723 118,261 101,916 122,895 106,639 Net investment income 437 158 58,315 121,230 58,752 121,388 Miscellaneous - - 26,833 - 26,833 - Total revenue 62,851 62,430 3,009,526 2,864,551 3,072,377 2,926,981
Program expenses: General government 867 863 - - 867 863 Interest on long-term debt 19,444 21,022 - - 19,444 21,022 Water operations - - 884,458 958,832 884,458 958,832 Sewer operations - - 624,779 645,002 624,779 645,002 Contract services - - 1,256,853 1,313,241 1,256,853 1,313,241 Total program expenses 20,311 21,885 2,766,090 2,917,075 2,786,401 2,938,960
Increase (decrease) in net position 42,540 40,545 243,436 (52,524) 285,976 (11,979) Net Position-Beginning of Year (523,129) (563,674) 20,155,372 20,207,896 19,632,243 19,644,222 Net Position-End of Year $ (480,589) $ (523,129) $ 20,398,808 $ 20,155,372 $ 19,918,219 $ 19,632,243
Governmental Activities Property taxes were levied to satisfy the required annual debt payments on long-term obligations (see Note 5).
Business-type Activities Business-type activities reflect a increase in Net Position of $243,436 in 2016 compared to a $52,524 decrease in 2015.
• Total revenue increased by $144,975 or 5.1%. The increase in property taxes of $230,306 is due to the increase in assessed valuations, a direct result of the increase in market values of real and personal property values. The District’s mill levy remains unchanged at 7.104. 4
• Total program expenses decreased by $150,985 or 5.2%. This decrease is primarily due to the District Board adopting a deferred merit award policy during 2015 in order to retain existing employees and attract highly skilled and competent employees in the future. Additionally, the Board extended the sick leave accrual policy which was limited to 20 days to a maximum accrual of 60 days. The implementation of these policy changes during 2015 resulted in a significant increase in accrued liability and salary expense which is allocated to program expenses based on direct labor hours.
THE DISTRICT’S FUNDS
As noted earlier, Platte Canyon Water and Sanitation District uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Governmental Funds The Governmental Funds are accounted for using the modified accrual basis of accounting. As the District completed the year, it’s Governmental Funds reported a combined fund balance of $41,593. This amount is comprised of accumulated net property taxes and specific ownership taxes and is restricted for the payment of the outstanding loans.
The budgets for the special revenue funds are prepared on a basis consistent with generally accepted accounting principles (GAAP).
Proprietary Fund Unrestricted net position for the District’s enterprise fund at the end of 2016 amounted to $10,473,758 compared to $10,790,263 in 2015.
BUDGETARY HIGHLIGHTS
The District prepares its Enterprise Fund budget on a non-GAAP budgetary basis of accounting to recognize the fiscal impact of sale of assets, capital outlay, in addition to operations and nonoperating revenues and contributions. Capital contributions of facilities and depreciation are not reflected on the budget as they do not affect “funds available”. This budgetary accounting is required by state statutes.
The District’s actual revenues exceeded budgeted revenues by $161,712. Actual contract services revenue exceeded budgeted revenue by $158,133 due to an increase in administrative and maintenance time being devoted to Districts under contract. A fair value mark down of investments at December 31, 2016 in the amount of $70,871 more than offset the increase in investment yields during 2016 resulting in a negative budget variance of $19,509 for net investment income. It is the District policy to hold all investments to maturity, therefore, any fair market value adjustment is considered unrealized.
Total budgeted expenditures exceeded total actual expenditures by $454,426. In addition to budgeting for emergency reserve, the District budgets an additional 15% of the projected water and sewer capital expenses to cover unanticipated increases in construction costs. This amount was budgeted at $238,709. The negative budget variance of $147,733 relates to the rehabilitation of the Scott J. Morse Pump station. This rehabilitation project will be continued in 2017. 5
A positive budget variance for operations and administration resulted in the amount of $255,085. Actual expenditures for sewer operations and maintenance were $40,770 less than the amount budgeted. This difference is due to no emergency sewer main break repairs and fewer remedial repairs required during 2016. Personnel benefits were less than the amount budgeted by $81,774. This variance is due to the actual cost of medical insurance premiums being less than anticipated. A positive budget variance for building maintenance of $26,658 is due to the construction of a planned building remodel being delayed until early 2017. Under the Intergovernmental Agreement for Joint Office and Garage Facility with Southwest Metropolitan Water and Sanitation District the District will share in costs of the building remodel (see Note 9).
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The table below provides a summary of total capital assets, net of depreciation where applicable at December 31, 2016 and 2015.
Business-Type Activities 2016 2015 Land $ 5,000 $ 5,000 Construction in progress 881,536 24,888 Total non-depreciable assets 886,536 29,888 Water distribution system 4,935,943 5,172,471 Sewage collection system 3,218,147 3,241,336 Maintenance equipment 699,728 718,835 Office equipment 95,196 120,079 Total depreciable assets 8,949,014 9,252,721 Total capital assets $ 9,835,550 $ 9,282,609
The District completed two major capital projects lining 2,969 feet of sewer collection system mains amounting to $129,981 and replacing 160 feet of a water main amounting to $29,420. The District also purchased two Ford pickups for a combined $62,283, and a Hurco vacuum/valve operator for $45,000. Other maintenance and office equipment purchases amounted to $25,326. Additionally, the District began construction on the planned replacement of the major components of the Scott J. Morse Pump station. Total costs to date amount to $881,536 with the project to be completed during 2017.
Additional information on the District’s capital assets can be found in Note 4 of this report.
6
Debt
Subdistrict No. 1 and Subdistrict No. 2 have loans outstanding at December 31, 2016. During 2016, principal and interest payments on the loans were made as required. Detail of the long-term debt obligations are presented in Note 5.
Economic Factors and Next Year’s Budget
• Property and specific ownership taxes for general operating purposes were budgeted in the amount of $1,590,643, which represents 54.0% of total District budgeted revenue. • Revenue from contract services is expected to be $1,230,472. • The average yield on investments is projected to be 1.0% resulting in estimated investment income of approximately $105,260. • The budget for operating expenditures and capital expenditures is $2,327,644 and $1,951,734, respectively. • Total expenditures for 2017 are projected to exceed revenue by $1,329,923 which will be funded by the District’s current funds available. • The Subdistrict No. 1 levied a property tax assessment in the amount of $28,524, which is budgeted to satisfy its annual debt requirements. • The Subdistrict No. 2 levied a property tax assessment in the amount of $29,084, which is budgeted to satisfy its annual debt requirements.
Requests for Information
This report is designed to provide a general overview of the District’s finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to: Financial Administrator, Platte Canyon Water and Sanitation District, 8739 W. Coal Mine Ave., Littleton, Colorado 80123.
7
BASIC FINANCIAL STATEMENTS
PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF NET POSITION December 31, 2016
(with comparative totals for December 31, 2015)
Governmental Business-type Total Activities Activities 2016 2015 ASSETS Cash and cash equivalents $ 41,212 $ 3,524,546 $ 3,565,758 $ 2,831,394 Investments - 7,160,695 7,160,695 7,848,366 Receivable from County Treasurers 381 9,507 9,888 8,533 Accounts receivable - 111,078 111,078 130,559 Accrued interest receivable - 21,050 21,050 8,686 Property taxes receivable 57,500 1,480,700 1,538,200 1,545,600 Prepaid expenses - 60,968 60,968 61,568 Prepaid lease, current portion - 15,460 15,460 15,460 Prepaid lease, long-term portion - 350,172 350,172 365,632 Land - 5,000 5,000 5,000 Construction in progress - 881,536 881,536 24,888 Capital assets, (net of accumulated depreciation): Water distribution system - 4,935,943 4,935,943 5,172,471 Sewage collection system - 3,218,147 3,218,147 3,241,336 Maintenance equipment - 699,728 699,728 718,835 Office equipment - 95,196 95,196 120,079 Total assets 99,093 22,569,726 22,668,819 22,098,407
LIABILITIES Accounts and retainage payable - 323,859 323,859 31,959 Accrued salaries and benefits - 65,151 65,151 63,044 Accrued interest payable 3,126 - 3,126 3,471 Deposits from developers - - - 1,496 Long-term obligations, due within one year 39,205 26,272 65,477 65,615 Long-term obligations, due in more than one year 479,851 274,936 754,787 754,979 Total liabilities 522,182 690,218 1,212,400 920,564
DEFERRED INFLOWS OF RESOURCES Deferred property tax revenue 57,500 1,480,700 1,538,200 1,545,600 Total deferred inflows of resources 57,500 1,480,700 1,538,200 1,545,600
NET POSITION Net investment in capital assets - 9,835,550 9,835,550 9,282,609 Restricted for debt service 38,467 - 38,467 33,748 Restricted for Emergencies - 89,500 89,500 82,500 Unrestricted (519,056) 10,473,758 9,954,702 10,233,386
TOTAL NET POSITION $ (480,589) $ 20,398,808 $ 19,918,219 $ 19,632,243
These financial statements should be read only in connection with the accompanying notes to financial statements.
8 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF CHANGES IN NET POSITION For the Year Ended December 31, 2016
(with comparative totals for December 31, 2015)
Program Revenue Net (Expense) Revenue and Charges Capital Changes in Net Position For Grants and Governmental Business-Type Total Expenses Services Contributions Activities Activities 2016 2015 FUNCTIONS/PROGRAMS Governmental Activities General government $ 867 -$ -$ $ (867) -$ $ (867) $ (863) Interest on long term obligations 19,444 - - (19,444) - (19,444) (21,022) Total Governmental Activities 20,311 - - (20,311) - (20,311) (21,885)
Business-type Activities Water operations 884,458 - - - (884,458) (884,458) (953,032) Sewer operations 624,779 - 2,000 - (622,779) (622,779) (526,002) Contract services 1,256,853 1,319,558 - - 62,705 62,705 (50,889) Total Business-type Activities 2,766,090 1,319,558 2,000 - (1,444,532) (1,444,532) (1,529,923) Total Primary Government $ 2,786,401 $ 1,319,558 $ 2,000 (20,311) (1,444,532) (1,464,843) (1,551,808)
GENERAL REVENUE Property tax revenue 57,780 1,484,559 1,542,339 1,311,802 Specific ownership tax 4,634 118,261 122,895 106,639 Net investment income 437 58,315 58,752 121,388 Miscellaneous - 26,833 26,833 - Total General Revenue 62,851 1,687,968 1,750,819 1,539,829 Change in Net Position 42,540 243,436 285,976 (11,979) Net Position - Beginning of year (523,129) 20,155,372 19,632,243 19,644,222 Net Position - End of year $ (480,589) $ 20,398,808 $ 19,918,219 $ 19,632,243
These financial statements should be read only in connection with the accompanying notes to financial statements.
9 PLATTE CANYON WATER AND SANITATION DISTRICT BALANCE SHEETS GOVERNMENTAL FUNDS December 31, 2016
Total Governmental Subdistrict No.1 Subdistrict No.2 Funds ASSETS Cash and cash equivalents $ 23,051 $ 18,161 $ 41,212 Receivable from County Treasurer 189 192 381 Property taxes receivable 28,500 29,000 57,500 Total assets $ 51,740 $ 47,353 99,093
DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES DEFERRED INFLOWS OF RESOURCES Deferred property tax revenue $ 28,500 $ 29,000 57,500 Total deferred inflows of resources 28,500 29,000 57,500 FUND BALANCES Restricted for debt service 23,240 18,353 41,593 Total fund balances 23,240 18,353 41,593 TOTAL DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES $ 51,740 $ 47,353
Amounts reported for governmental activities in the Statement of Net Position are different because:
Long-term liabilities are not due and payable in the current period and therefore are not reported in the governmental funds: Loans payable (519,056) Interest payable (3,126)
Net Position of Governmental Activities $ (480,589)
These financial statements should be read only in connection with the accompanying notes to financial statements.
10 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS For the Year Ended December 31, 2016
Total Governmental Subdistrict No.1 Subdistrict No.2 Funds
REVENUE Property taxes $ 28,692 $ 29,088 $ 57,780 Specific ownership taxes 2,301 2,333 4,634 Net investment income 247 190 437 Total revenue 31,240 31,611 62,851
EXPENDITURES Debt service Principal 19,133 18,688 37,821 Interest 9,392 10,397 19,789 Treasurer fees 431 436 867 Total expenditures 28,956 29,521 58,477
NET CHANGE IN FUND BALANCES 2,284 2,090 4,374 FUND BALANCE - BEGINNING OF YEAR 20,956 16,263 37,219 FUND BALANCES - END OF YEAR $ 23,240 $ 18,353 $ 41,593
These financial statements should be read only in connection with the accompanying notes to financial statements.
11 PLATTE CANYON WATER AND SANITATION DISTRICT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF CHANGES IN NET POSITION For the Year Ended December 31, 2016
NET CHANGE IN FUND BALANCES - GOVERNMENTAL FUNDS 4,374$
Amounts reported for Governmental Activities in the Statement of Changes in Net Position are different because:
Some expenses reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in the governmental funds.
Change in accrued interest payable 345
The repayment of the principal of long-term debt consumes the current financial resources of governmental funds, but has no effect on net position.
Principal payments on loans 37,821
CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES 42,540$
These financial statements should be read only in connection with the accompanying notes to financial statements.
12 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL SPECIAL REVENUE FUND - SUBDISTRICT NO. 1 For the Year Ended December 31, 2016
Original and Variance Final Actual Positive Budget Amounts (Negative)
REVENUE Property taxes $ 28,526 $ 28,692 $ 166 Specific ownership taxes 1,854 2,301 447 Net investment income 31 247 216 Total revenue 30,411 31,240 829
EXPENDITURES Debt service Principal 19,135 19,133 2 Interest 9,391 9,392 (1) Treasurer fees 430 431 (1) Total expenditures 28,956 28,956 -
NET CHANGE IN FUND BALANCE 1,455 2,284 829 FUND BALANCE - BEGINNING OF YEAR 20,612 20,956 344 FUND BALANCE - END OF YEAR $ 22,067 $ 23,240 $ 1,173
These financial statements should be read only in connection with the accompanying notes to financial statements.
13 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL SPECIAL REVENUE FUND - SUBDISTRICT NO. 2 For the Year Ended December 31, 2016
Variance with Original and Final Budget Final Actual Positive Budget Amounts (Negative)
REVENUE Property taxes $ 29,088 $ 29,088 $ - Specific ownership taxes 1,891 2,333 442 Net investment income 24 190 166 Total revenue 31,003 31,611 608
EXPENDITURES Debt service Principal 18,689 18,688 1 Interest 10,399 10,397 2 Treasurer fees 440 436 4 Total expenditures 29,528 29,521 7
NET CHANGE IN FUND BALANCE 1,475 2,090 615 FUND BALANCE - BEGINNING OF YEAR 15,836 16,263 427 FUND BALANCE - END OF YEAR $ 17,311 $ 18,353 $ 1,042
These financial statements should be read only in connection with the accompanying notes to financial statements.
14 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF NET POSITION ENTERPRISE FUND December 31, 2016
(with comparative totals for December 31, 2015)
2016 2015 ASSETS Current assets Cash and cash equivalents $ 3,524,546 $ 2,794,585 Investments 7,160,695 7,848,366 Receivable from County Treasurers 9,507 8,123 Accounts receivable 111,078 130,559 Accrued interest receivable 21,050 8,686 Property taxes receivable 1,480,700 1,488,000 Prepaid expenses 60,968 61,568 Current portion of prepaid lease 15,460 15,460 Total Current assets 12,384,004 12,355,347 Non-current assets Prepaid lease 350,172 365,632 Land 5,000 5,000 Construction in progress 881,536 24,888 Capital assets, net of depreciation: Water distribution system 4,935,943 5,172,471 Sewage collection system 3,218,147 3,241,336 Maintenance equipment 699,728 718,835 Office equipment 95,196 120,079 Total Noncurrent assets 10,185,722 9,648,241 TOTAL ASSETS 22,569,726 22,003,588
LIABILITIES Current liabilities Accounts payable 286,620 31,959 Retainage payable 37,239 - Accrued salaries and benefits 65,151 63,044 Deposits from developers - 1,496 Long-term obligations, current portion 26,272 27,794 Total Current liabilities 415,282 124,293 Non-current liabilities Long-term obligations, non-current portion 274,936 235,923 TOTAL LIABILITIES 690,218 360,216 DEFERRED INFLOWS OF RESOURCES Deferred property tax revenue 1,480,700 1,488,000 TOTAL DEFERRED INFLOWS OF RESOURCES 1,480,700 1,488,000 NET POSITION Net investment in capital assets 9,835,550 9,282,609 Restricted for emergencies 89,500 82,500 Unrestricted 10,473,758 10,790,263
TOTAL NET POSITION $ 20,398,808 $ 20,155,372
These financial statements should be read only in connection with the accompanying notes to financial statements.
15 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION ENTERPRISE FUND For the Year Ended December 31, 2016
(with comparative totals for December 31, 2015)
2016 2015
OPERATING REVENUE Contract Services $ 1,315,503 $ 1,252,447 Other 4,055 9,905 Total operating revenue 1,319,558 1,262,352
OPERATING EXPENSES Water operations 582,377 658,815 Sewer operations 411,457 441,851 Contract services 1,256,853 1,313,241 General and administrative 493,109 484,330 Total operating expenses 2,743,796 2,898,237
(LOSS) FROM OPERATIONS (1,424,238) (1,635,885)
NONOPERATING REVENUE (EXPENSES) Property taxes 1,484,559 1,254,253 Specific ownership taxes 118,261 101,916 Net investment income 58,315 121,230 Gain on sale of property and equipment 26,833 - County Treasurer's collection fees (22,294) (18,838) Total nonoperating revenue (expenses) 1,665,674 1,458,561
INCOME (LOSS) BEFORE CAPITAL CONTRIBUTIONS 241,436 (177,324)
CAPITAL CONTRIBUTIONS Tap fees 2,000 9,800 Contributed assets - 115,000 Total capital contributions 2,000 124,800
CHANGE IN NET POSITION 243,436 (52,524) NET POSITION - BEGINNING OF YEAR 20,155,372 20,207,896 NET POSITION - END OF YEAR $ 20,398,808 $ 20,155,372
These financial statements should be read only in connection with the accompanying notes to financial statements.
16 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF CASH FLOWS ENTERPRISE FUND For the Year Ended December 31, 2016
(with comparative totals for December 31, 2015)
2016 2015 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from contract services and customers $ 1,337,543 $ 1,233,002 Cash payments to suppliers for goods and services (566,282) (625,604) Cash payments to employees for services (1,496,404) (1,451,180) Cash flows used for operating activities (725,143) (843,782)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Property taxes - Net 1,460,881 1,236,453 Specific ownership taxes 118,261 101,916 Cash flows provided by noncapital financing activities 1,579,142 1,338,369
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Contributed capital - Tap fees 2,000 9,800 Acquisition of capital assets (886,615) (547,242) Proceeds from sale of capital assets 26,955 - Cash flows used for capital and related financing activities (857,660) (537,442)
CASH FLOWS FROM INVESTING ACTIVITIES Interest received 100,009 99,246 Purchase of investments (4,505,768) (3,194,871) Matured investments 5,139,381 3,450,000 Cash flows provided (used) by investing activities 733,622 354,375
NET INCREASE IN CASH AND CASH EQUIVALENTS 729,961 311,520 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 2,794,585 2,483,065 CASH AND CASH EQUIVALENTS - END OF YEAR $ 3,524,546 $ 2,794,585
(Continued)
These financial statements should be read only in connection with the accompanying notes to financial statements
17 PLATTE CANYON WATER AND SANITATION DISTRICT STATEMENT OF CASH FLOWS For the Year Ended December 31, 2016
(with comparative totals for December 31, 2015)
(Continued)
2016 2015 Reconciliation of (loss) from operations to net cash used for operating activities (Loss) from operations $ (1,424,238) $ (1,635,885) Adjustments to reconcile (loss) from operations to net cash used for operating activities Depreciation and amortization 611,055 595,198 Effects of changes in operating assets and liabilities: Receivables 19,481 (30,846) Prepaid expenses 600 2,807 Accounts payable 29,857 2,543 Accrued salaries and benefits 2,107 5,971 Compensated absences 37,491 214,934 Deposits from developers (1,496) 1,496 Total adjustments 699,095 792,103
Net cash used for operating activities $ (725,143) $ (843,782)
NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES Contributions of capital assets from developers $ - $ 115,000
These financial statements should be read only in connection with the accompanying notes to financial statements
18
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 1 – DEFINITION OF REPORTING ENTITY
The District, a quasi-municipal corporation, is governed pursuant to provisions of the Colorado Special District Act. The District’s service area is located in Jefferson and Arapahoe Counties, Colorado. The District was established to provide water and sanitation services.
The District has maintenance agreements with Southwest Metropolitan Water and Sanitation District and other water and sanitation districts. The contracts provide that the District will perform administration and maintenance services using the District’s personnel and equipment, with reimbursement to the District for labor, materials and use of equipment and general and administration expenses (See Note 9).
The District follows the Governmental Accounting Standards Board (GASB) accounting pronouncements which provide guidance for determining which governmental activities, organizations and functions should be included within the financial reporting entity. GASB pronouncements set forth the financial accountability of a governmental organization’s elected governing body as the basic criterion for including a possible component governmental organization in a primary government’s legal entity. Financial accountability includes, but is not limited to, appointment of a voting majority of the organization’s governing body, ability to impose its will on the organization, a potential for the organization to provide specific financial benefits or burdens and fiscal dependency.
Blended Component Units
Platte Canyon Water and Sanitation Subdistrict No. 1 (Subdistrict No. 1) was established in 2005 pursuant to the provisions of § 32-1-1101(f) of the Colorado Revised Statutes. The area of the Subdistrict No. 1, located entirely within the District boundaries, is known as the Columbine Townhouses III Subdivision (Subdivision). The Subdistrict No. 1 was formed for the purpose of financing certain public water distribution system improvements needed to serve the Subdivision. The Subdistrict No. 1 will assess a levy against all real property within its boundaries for the payment of principal and interest on the loan. The Subdistrict No. 1 is included as a blended component unit of the District because the District’s board members are the same, the District provides substantial support to the Subdistrict No. 1, and the improvements within the Subdistrict No. 1 ultimately benefit the District as a whole. Separate financial statements are not prepared for the Subdistrict No. 1.
19
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 1 – DEFINITION OF REPORTING ENTITY (CONTINUED)
In 2007 the District Board of Directors established the Platte Canyon Water and Sanitation Subdistrict No. 2 (Subdistrict No. 2) pursuant to the provisions of § 32-1-1101(f) of the Colorado Revised Statutes. The area of Subdistrict No. 2, located entirely within the District boundaries, is known as the Colombine Townhouses Four Subdivision (Subdivision). Subdistrict No. 2 was formed for the purpose of financing certain public water distribution system improvements needed to serve the Subdivision. The Subdistrict No. 2 will assess a levy against all real property within its boudaries for the payment of principal and interest on the loan. The Subdistrict No. 2 is included as a blended component unit of the District because the District’s board members are the same, the District provides substantial support to Subdistrict No. 2, and the improvements will ultimately benefit the District as a whole. Separate financial statements are not prepared for the Subdistrict No. 2.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The more significant accounting policies of the District are described as follows:
Government-wide and fund Financial Statements
The government-wide financial statements (i.e. the Statement of Net Position and the Statement of Changes in Net Position) report information on all of the activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenue, are reported separately from business-type activities, which rely, to a significant extent on fees and charges for support.
The statement of changes in net position demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenue. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or entities who use or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Internally dedicated resources are reported as general revenues rather than as program revenues.
Separate financial statements are provided for the governmental funds and the proprietary fund because all are considered major funds.
20
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenue in the year for which they are levied.
Governmental fund financial statements are reported using the current financial resources measurement focus and modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collected within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the District considers revenue to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures are recorded only when payment is due.
Property and specific ownership taxes as well as investment income associated with the current fiscal period are considered to be susceptible to accrual and so have been recognized as revenue of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the District.
The District reports the following major governmental funds:
Subdistrict No. 1 Fund and Subdistrict No. 2 Fund – These funds are included as blended component units of the District. The funds are used to account for the financing of certain public water distribution system improvements needed to serve specific subdivisions located in the District. The costs of the improvements are confined to the individual subdivisions by a separate tax levy than that of the District as a whole.
The District reports the following major proprietary fund:
Enterprise Fund – This fund is used to account for the effective and economical operation of water and sewer systems within the jurisdictional boundaries of the District.
Functional expenses for business-type activities in the government-wide and proprietary fund financial statements include allocated indirect overhead expense.
21
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Proprietary funds distinguish operating revenue and expenses from nonoperating items. Operating revenue and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. Operating revenues of the District’s enterprise fund consist of charges to other local governments for services provided. Operating expenses for the enterprise fund include cost of service, administrative expenses, and depreciation of assets. All revenues and expenses not meeting this definition are reported as nonoperating revenue and expenses or capital contributions.
When both restricted and unrestricted resources are available for use, it is the District’s practice to use restricted resources first, then unrestricted resources as they are needed.
Budgets
In accordance with the State Budget Law, the District’s Board of Directors holds public hearings in the fall each year to approve the budget and appropriate the funds for the ensuing year. The appropriation is at the total fund expenditures level and lapses at year end. The District’s Board of Directors can modify the budget by line item within the total appropriation without notification. The appropriation can only be modified upon completion of notification and publication requirements. A budget is legally adopted for each fund of the District. The budgets for the Special Revenue funds are adopted on a basis consistent with generally accepted accounting principles (GAAP). Budgetary comparisons for the Proprietary Fund are presented on a non-GAAP budgetary basis. Capital outlay is budgeted as an expenditure and depreciation is not budgeted. Budgeted amounts in the financial statements are as originally adopted, or as amended by the Directors.
Cash Equivalents and Investments
For purposes of the statement of cash flows, the District considers cash deposits and highly liquid investments with a maturity of three months or less when purchased, to be cash equivalents. Investments are recorded at fair value.
Receivables
All receivables are recorded at their gross value and where appropriate, are reduced by the estimated portion that is expected to be uncollectible.
Prepaid Expenses
Payments made to vendors for services which will benefit periods after December 31 are recorded as prepaid items.
22
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Property Taxes
Property taxes are levied by the District Board of Directors. The levy is based on assessed valuations determined by the County Assessor generally as of January 1 of each year. The levy is normally set by December 15 by certification to the County Commissioners to put the tax lien on the individual properties as of January 1 of the following year. The County Treasurers collect the determined taxes during the ensuing calendar year. The taxes are payable by April 30 or if in equal installments, at the taxpayer election, in February and June. Delinquent taxpayers are notified in August and generally sales of the tax liens on delinquent properties are normally held in November or December. The County Treasurers remit the taxes collected monthly to the District.
Property taxes, net of estimated uncollectible taxes, are considered deferred inflows of resources and are recorded initially as deferred revenue in the year they are levied and measurable. The deferred property tax revenues are recorded as revenue in the year they are available or collected (the year that it is levied for).
Capital Assets
Capital assets which include property, equipment, and infrastructure are reported in the applicable governmental or business-type activities columns in the government-wide financial statements and the proprietary funds in the fund financial statements. Such assets are recorded at cost except for those assets which have been contributed which are recorded at estimated fair value at the date of contribution or at developer’s cost. Capital assets are defined by the District as assets with an initial cost of more than $1,000 and an estimated useful life in excess of three years. Depreciation expense has been computed using the straight-line method over the following estimated economic useful lives:
Distribution and Collection Systems 20 – 40 years Maintenance and Office Equipment 3 – 10 years
Compensated Absences
The District accrues accumulated unpaid vacation, sick leave and a deferred merit award when earned by the employee. The District has a policy which allows employees to accumulate unused vacation and sick leave up to a certain maximum number of hours. The District compensates employees based on a merit award percentage up to a maximum of forty-five completed years of service. The accumulated vacation, sick leave, and deferred merit award are recorded as an accrued liability and current salary expense when incurred in the proprietary fund financial statements. In the event of termination, an employee is reimbursed for the accumulated hours and compensated for the total number of completed years of service up to the maximum amounts.
23
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Developer Deposits
Developer deposits include funds that have been collected by the District for services to be provided in subsequent periods. At the time the services are provided, the liability is removed from the government-wide and proprietary fund Statements of net position or the governmental fund balance sheet and revenue is recognized.
Fund Balances / Governmental Funds
The District’s fund balances fall under the category of “restricted” because the balances are constrained for specific purposes by their providers (such as grantors, bondholders, and higher levels of government), through constitutional provisions, or by enabling legislation.
At December 31, 2016, the District reported restricted fund balance in the Subdistrict No. 1 and Subdistrict No. 2 Special Revenue Funds in the amounts of $23,240 and $18,353 respectively, are to be used exclusively for debt service requirements (see Note 5).
Net Position
The District has net position consisting of three components – net investment in capital assets, restricted and unrestricted. Net investment in capital assets, consists of capital assets, net of accumulated depreciation and if applicable, reduced by the outstanding balances of bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. Restricted net position includes amounts that are restricted for use either externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or imposed by law through constitutional provisions or enabling legislation (see Note 11). Net position in the Government Activities in the amount of $38,467 is restricted for debt service requirements (see Note 5)
Negative net position will be reported for the Governmental Activities until the long-term debt obligation is satisfied. At December 31, 2016, negative net position in the amount of $519,056 was reported for the Governmental Activities.
Comparative Data
Comparative total data for the prior year has been presented in the accompanying financial statements in order to provide an understanding of changes in the District’s financial position and operations. However, comparative data has not been presented in all statements because such inclusion would make certain statements unduly complex and difficult to understand. Also, certain amounts presented in the prior year data have been reclassified to be consistent with the current year presentation. 24
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 3 – CASH AND INVESTMENTS
At December 31, 2016 the District had the following cash and investments:
Cash on hand $ 150 Deposits 1,476,618 Investments 9,249,685 Total $ 10,726,453
Cash deposits and investments are reflected on the December 31, 2016 Statement of Net Position as follows:
Cash and cash equivalents $ 3,565,758 Investments 7,160,695 Total $ 10,726,453
Cash Deposits
The Colorado Public Deposit Protection Act (PDPA) requires deposits of all units of local government to be made in eligible public depositories. Eligibility is determined by state regulations. Amounts on deposit in excess of federal insurance levels must be collateralized by eligible collateral as determined by the PDPA. PDPA allows the institution to create a single collateral pool for all public funds. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. The market value of the collateral must be at least equal to the 102% of the uninsured deposits.
25
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Investments
The District is required to comply with State statutes and the District’s investment policy which specify instruments meeting defined rating, maturity, and concentration risk criteria in which the District may invest, which include the following. State statute does not address custodial risk.
. Obligations of the U.S. and certain U.S. government agency securities and the World Bank . General obligation and revenue bonds of U.S. local government entities . Bankers’ acceptances of certain banks . Commercial paper . Certain reverse repurchase agreements . Written repurchase agreements collateralized by certain authorized securities . Certain money market mutual funds . Guaranteed investment contracts . Local government investment pools
At December 31, 2016 the District had the following investments:
Maturities (in Years) Investment Rating Less than 1 1 - 5 More than 5 Total U.S. Government Instrumentalities AAA/AA+ $ - $ 3,959,145 $ 958,040 $ 4,917,185 U.S. Treasury Notes N/A 1,000,510 - - 1,000,510 Local Government Investment Pool AAAm 3,331,990 - - 3,331,990 $ 4,332,500 $ 3,959,145 $ 958,040 $ 9,249,685
Interest Rate Risk – The District’s investment policy limits investment maturities by investment type. Maturities for investments in U.S. Treasuries and U.S. Agencies are limited to a maximum of 10 years.
Credit risk – The District’s investment policy limits investments to U.S. Treasury obligations, U.S. Government Agency and Instrumentality securities, local government investment pools, and certain money market mutual funds approved by the Board of Directors. At the time of purchase, investments must have a credit rating equal to or greater than that specified by state statutes.
26
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Concentration of Credit Risk – It is the policy of the District to diversify its investment portfolio to eliminate risk of loss resulting from over concentration of assets in a specific maturity, a specific class, and specific issuer of securities. The District policy includes cash deposits in the total portfolio when determining concentration of investments. The policy provides that the total portfolio of the District may be comprised of 100% U.S. Treasury Notes. However, investment in U.S. Government instrumentalities may not exceed 50% of the District’s total portfolio and investment in any one issuer may not exceed 20% of the total portfolio. Investments in local government investment pools as well as money market mutual funds may not exceed 25% of the District’s total portfolio. The policy provides for variances in the stated maximum percentage limitations not to exceed 10% at any given time. At December 31, 2016, the District’s investment in Federal Home Loan Bank, Federal Home Loan Mortgage Corporation, Federal National Mortgage Association and Federal Farm Credit Bank were 10.88%, 16.18%, 15.74% and 10.36%, respectively, of the District’s total investments and 9.38%, 13.95%, 13.57%, and 8.93%, respectively, of the District’s total portfolio.
Local Government Investment pool – The District has investments in the Colorado Local Government Liquid Asset Trust (COLOTRUST), an investment vehicle established for local government entities in Colorado to pool surplus funds. The State Securities Commissioner administers and enforces all State statutes governing COLOTRUST. COLOTRUST operates similarly to a money market fund and each share is equal in value to $1.00. A designated custodial bank serves as custodian for the COLOTRUST portfolios pursuant to a custodian agreement. Substantially all securities owned by COLOTRUST are held by the Wells Fargo Bank, N.A. in the account maintained for the custodial banks. The custodian acts as safekeeping agent for COLOTRUST investment portfolios and provides services as the depository in connection with direct investments and withdrawals. The custodian's internal records segregate investments owned by each participating government.
Investment Valuation The District categorizes the fair value measurements of its investments based on the hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. Fair value measurements of the District’s investments are as follows at December 31, 2016:
Fair Value Measurement Using Investment Level 1 inputs Level 2 inputs Level 3 inputs Total U.S. Government Instrumentalities $ 4,917,185 $ - $ - $ 4,917,185 U.S. Treasury Notes 1,000,510 - - 1,000,510 Local Government Investment Pool - 3,331,990 - 3,331,990 $ 5,917,695 $ 3,331,990 $ - $ 9,249,685
27
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 4 – CAPITAL ASSETS
The following is an analysis of changes in the business-type activities capital assets for the year ended December 31, 2016:
Balance Balance at January 1, December 31, By Classification 2016 Additions Deletions 2016
Business-type Activites Land $ 5,000 $ - $ - $ 5,000 Construction in progress 24,888 856,648 - 881,536 Total non-depreciable assets 29,888 856,648 - 886,536 Water distribution system 12,429,085 29,420 1,170 12,457,335 Sewage collection system 9,234,793 129,981 24,844 9,339,930 Maintenance equipment 1,414,076 112,967 95,489 1,431,554 Office equipment 382,120 19,642 30,610 371,152 Total capital assets being depreciated 23,460,074 292,010 152,113 23,599,971
Less Accumulated Depreciation Water distribution system (7,256,614) (265,948) (1,170) (7,521,392) Sewage collection system (5,993,457) (153,170) (24,844) (6,121,783) Maintenance equipment (695,241) (131,952) (95,367) (731,826) Office equipment (262,041) (44,525) (30,610) (275,956) Total Accumulated Depreciation (14,207,353) (595,595) (151,991) (14,650,957) Total capital assets being depreciated, net 9,252,721 (303,585) 122 8,949,014 Net Capital Assets $ 9,282,609 $ 553,063 $ 122 $ 9,835,550
Depreciation expense for the years ended December 31, 2016 was charged to the following programs:
Business-type Activites: Water operations $ 297,043 Sewer operations 186,983 Contract services 111,569 $ 595,595
28
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 5 – LONG-TERM OBLIGATIONS
The following is an analysis of changes in the governmental activities and business-type activities long-term obligations for the year ended December 31, 2016:
Balance Balance at January 1, December 31, Due within 2016 Additions Deletions 2016 one year Government Activities: Subdistrict No. 1 (2006) - $400,000 CWRPDA Loan $ 255,181 $ - $ 19,133 $ 236,048 $ 19,858 Subdistrict No. 2 (2008) - $475,000 CWRPDA Loan 301,696 - 18,688 283,008 19,347 556,877 $ - $ 37,821 519,056 $ 39,205 Less current portion (37,821) (39,205) $ 519,056 $ 479,851 Business-type Activities: Accrual for compensated absences $ 263,717 $ 109,793 $ 72,302 $ 301,208 $ 26,272 Less current portion (27,794) (26,272) $ 235,923 $ 274,936
Accrual for compensated absences (see Note 2) is liquidated from the Enterprise fund.
The detail of the District’s governmental activities long-term obligation is as follows:
Colorado Water Resources and Power Development Authority: $400,000 Loan, dated June 30, 2006, with interest of 3.75%, due semi-annually through 2026. Loan repayments may be prepaid, in whole or in part, upon prior written notice of not less than ninety (90) days to the Authority. This loan was entered into by the Subdistrict No. 1 for the purpose of financing water system improvements. The District is in no way obligated to repay the loan.
$475,000 Loan, dated July 15, 2008, with interest of 3.50%, due semi-annually through 2028. Loan repayments may be prepaid, in whole or in part, upon prior written notice of not less than ninety (90) days to the Authority. This loan was entered into by the Subdistrict No. 2 for the purpose of financing water system improvements. The District is in no way obligated to repay the loan. 29
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 5 – LONG-TERM OBLIGATIONS (CONTINUED)
The District’s long-term obligations of the governmental activities will mature as follows: Principal Interest Total 2017$ 39,205 $ 18,405 $ 57,610 2018 40,640 16,970 57,610 2019 42,127 15,483 57,610 2020 43,669 13,941 57,610 2021 45,268 12,342 57,610 2022-2026 252,436 35,614 288,050 2027-2028 55,711 2,458 58,169 $ 519,056 $ 115,213 $ 634,269
NOTE 6 – SERVICE CONTRACTS
Water
The District has a distributor’s contract with the Denver Water Board whereby the Denver Water Department provides water in the District’s service area and charges the users directly (“read and bill” type of distributor’s contract). The District owns and maintains the water distribution system.
Sewer
The District has a contract with the City of Littleton whereby the City provides sewage treatment for the District and bills the users directly. The District owns and maintains the sewage collection system.
NOTE 7 – PENSION PLAN
The District has adopted a single employer defined contribution pension plan administered by Colorado Counties Officials and Employees Retirement Association (CCOERA) which covers substantially all employees (minimum eligibility requirements of 20 or more hours of work per week and one full year of continuous service). Contribution requirements of the District and eligible employees are established and may be amended by the District Board of Directors. Eligible employees must participate in the plan with an elected contribution between 3% and 8% of gross wages less overtime pay. The District matches the employees elected contribution level. Withdrawal from the Plan may occur only upon retirement, death, disability or termination of employment. Employees vest 100% in personal contributions and 20% for each year of employment in employer contributions (fully vested after five years of employment). District contributions for employees who leave employment before five years of participation are used to reduce the District’s current period contribution requirement. There is no liability for benefits under the plan beyond the District’s matching payments. 30
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 7 – PENSION PLAN (CONTINUED)
For the year ended December 31, 2016, employee contributions totaled $74,668, and the District recognized pension expense of $74,668. During 2016, there were no forfeitures.
At December 31, 2016, the District had 13 current active plan members and the District’s liability to the plan amounted to $3,234.
NOTE 8 – DEFERRED COMPENSATION PLAN
The District has a deferred compensation plan created in accordance with Internal Revenue Code Section 457. This plan is administered by Colorado County Officials and Employees Retirement Association (CCOERA). Participation in the plan is optional for all employees. The plan allows the employees to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement or death or unforeseen emergencies.
NOTE 9 – COMMITMENTS
Management and Maintenance Agreement
The District has an intergovernmental agreement with Southwest Metropolitan Water and Sanitation District (Southwest) to provide management, maintenance, inspection and clerical services. Under the agreement, the District bills Southwest monthly for its proportionate share of costs. During 2014 the contract was renewed for ten years with an option to renew for successive five year periods after December 31, 2024. During 2016 the District earned reimbursement for contract services from Southwest in the amount of $978,552.
Operating Lease Agreement
The District has an agreement for office and storage space with Southwest. The District jointly funded the expansion and renovation of Southwest’s office space being used for District operations. The District paid 30% of the construction costs and began amortizing the prepaid lease payment of $618,417 on July 1, 2000. The District amortizes the prepaid lease costs over 40 years. At December 31, 2016, the balance of the prepaid lease amounted to $365,632. The District pays Southwest a monthly rent and a proportionate share of the operation and maintenance expense determined on a quarterly basis. The Intergovernmental Agreement for Joint Office and Garage Facility will be effective until December 31, 2018, with the option for renewal for successive periods not to exceed five years each. Upon termination, the District will be entitled to 30% of the appraised replacement value of the joint facility excluding land value. Operation and maintenance costs paid to Southwest during 2016 amounted to $47,453.
31
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 9 – COMMITMENTS (CONTINUED)
Contracts for Services
The District has entered into intergovernmental agreements with Bow Mar Water and Sanitation District (Bow Mar), Columbine Water and Sanitation District (Columbine), Lochmoor Water and Sanitation District (Lochmoor), and Valley Sanitation District (Valley) to provide certain administrative and maintenance services. The District bills Bow Mar, Columbine, Lochmoor, and Valley monthly for work performed based on agreed upon rates of hours worked and cost of materials. During 2016 the District earned $336,951 which is recorded as contract services.
Construction Commitments
As of December 31, 2016, the District had an unexpended construction related contract commitment for the rehabilitation of a pump station in the amount of $350,693.
NOTE 10 – RISK MANAGEMENT
Except as provided in the Colorado Government Immunity Act, as amended from time to time, the District is exposed to various risks of loss related to torts, thefts of, damage to, or destruction of assets, errors or omissions, injuries to employees, or acts of God. The District is a member of the Colorado Special Districts Property and Liability Pool (Pool). The Pool is an organization created by intergovernmental agreement to provide property, liability, public officials’ liability, boiler and machinery, and workers compensation coverage to its members. Settled claims have not exceeded this coverage in any of the past three fiscal years.
The District pays annual premiums to the Pool for property, general and automobile liability, public officials, auto physical damage, inland marine, and boiler and machinery. In the event aggregate losses incurred by the Pool exceed amounts recoverable from reinsurance contracts and funds accumulated by the Pool, the Pool may require additional contributions from the Pool members. Any excess funds, which the Pool determines are not needed for purposes of the Pool, may be returned to the members pursuant to a distribution formula.
The District maintains commercial insurance for injuries to employees (worker’s compensation). Settled claims have not exceeded this coverage in any of the past three fiscal years.
32
PLATTE CANYON WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016
NOTE 11 – TAX, SPENDING AND DEBT LIMITATIONS
Article X, Section 20 of the Colorado Constitution, commonly known as the Taxpayer’s Bill of Rights (TABOR), contains tax, spending, revenue and debt limitations which apply to the State of Colorado and all local governments.
Spending and revenue limits are determined based on the prior year’s Fiscal Year Spending adjusted for allowable increases based upon inflation and local growth. Fiscal Year Spending is generally defined as expenditures plus reserve increases with certain exceptions. Revenue in excess of the Fiscal Year Spending limit must be refunded unless the voters approve retention of such revenue.
On November 4, 2003, a majority of the District’s electors authorized the District to collect, retain and spend all revenues and other funds received from all sources, including without limitation the District’s existing general operating property tax rate of 7.104 mills, commencing January 1, 2004, for general operations and capital improvements as a voter-approved revenue change, offset and exception to the limits which would otherwise apply under Article X, Section 20 and as a permanent waiver of the 5.5 percent limitation under Section 29-1-301 C.R.S.
The District’s management believes it is in compliance with the provisions of TABOR. However, TABOR is complex and subject to interpretation. Many of the provisions, including the interpretation of how to calculate Fiscal Year Spending limits and qualification as an Enterprise will require judicial interpretation.
TABOR requires local governments to establish Emergency Reserves. These reserves must be at least 3% of Fiscal Year Spending. Local governments are not allowed to use the emergency reserves to compensate for economic conditions, revenue shortfalls, or salary or benefit increases. At December 31, 2016, the District’s reserve of $89,500 was recorded as a restriction of net position in the enterprise fund.
This information is an integral part of the accompanying financial statements. 33
SUPPLEMENTARY INFORMATION
OTHER INFORMATION
SUPPLEMENTARY INFORMATION
PLATTE CANYON WATER AND SANITATION DISTRICT SCHEDULE OF OPERATING EXPENSES ENTERPRISE FUND For the Year Ended December 31, 2016
(with comparative totals for December 31, 2015)
2016 2015
WATER OPERATIONS Personnel $ 115,685 $ 132,048 Operations and maintenance 161,364 220,756 Depreciation and amortization 286,944 288,328 Equipment and vehicles 7,896 8,578 Insurance 7,176 6,969 Communications 3,312 2,136 Total water operations 582,377 658,815
SEWER OPERATIONS Personnel 156,428 195,353 Operations and maintenance 42,148 34,802 Depreciation and amortization 181,560 180,487 Equipment and vehicles 17,139 17,740 Insurance 9,704 10,309 Communications 4,478 3,160 Total sewer operations 411,457 441,851
CONTRACT SERVICES Personnel 971,060 1,042,211 Operations and maintenance 21,914 17,055 Depreciation and amortization 115,184 99,531 Equipment and vehicles 43,032 43,547 Insurance 8,710 10,261 Office Expenses 83,561 91,873 Communications 13,392 8,763 Total contract maintenance 1,256,853 1,313,241
GENERAL AND ADMINISTRATIVE Personnel 292,829 302,473 Professional and consulting 90,748 75,193 Operations and maintenance 15,147 7,306 Depreciation and amortization 27,367 26,852 Insurance 18,165 15,963 Office expenses 42,798 51,349 Other 6,055 5,194 Total general and administrative 493,109 484,330 Total operating expenses $ 2,743,796 $ 2,898,237
34 PLATTE CANYON WATER AND SANITATION DISTRICT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUNDS AVAILABLE BUDGET AND ACTUAL (Non-GAAP BUDGETARY BASIS) ENTERPRISE FUND Year Ended December 31, 2016
Original and Variance Final Positive Budget Actual (Negative)
REVENUE Contract Services $ 1,157,370 $ 1,315,503 $ 158,133 Property taxes 1,491,701 1,484,559 (7,142) Specific ownership taxes 96,961 118,261 21,300 Net investment income 77,824 58,315 (19,509) Sale of property and equipment 8,000 26,955 18,955 Tap fees 12,000 2,000 (10,000) Other 4,080 4,055 (25) Total revenue 2,847,936 3,009,648 161,712 EXPENDITURES OPERATIONS AND ADMINISTRATION Operations and Maintenance Water 173,500 156,890 16,610 Sewer 77,000 36,230 40,770 Equipment and vehicles 98,500 68,067 30,433 Communications 16,200 21,182 (4,982) Building maintenance 99,300 47,453 51,847 Personnel Wages 1,108,330 1,113,261 (4,931) Benefits 504,515 422,741 81,774 Office Expenses 121,400 94,742 26,658 Professional and consulting 135,500 122,365 13,135 Insurance 47,500 43,755 3,745 Other 28,375 28,349 26 Total operations and administration 2,410,120 2,155,035 255,085 CAPITAL OUTLAY Water distribution system 738,335 886,068 (147,733) Sewage collection system 210,955 129,981 80,974 Vehicles 33,000 62,283 (29,283) Maintenance equipment 59,500 50,684 8,816 Office equipment 67,500 19,642 47,858 Contingency 238,709 - 238,709 Total capital outlay 1,347,999 1,148,658 199,341 Total expenditures 3,758,119 3,303,693 454,426
EXCESS OF REVENUE OVER (UNDER) EXPENDITURES (910,183) (294,045) 616,138
FUNDS AVAILABLE - BEGINNING OF YEAR 10,376,587 10,491,671 115,084
FUNDS AVAILABLE - END OF YEAR $ 9,466,404 $ 10,197,626 $ 731,222
Funds available is computed as follows: Current assets $ 12,384,004 Current portion of prepaid lease (15,460) Current liabilities (415,282) Non-current portion of compensated absences (274,936) Deferred property tax revenue (1,480,700) $ 10,197,626
35 PLATTE CANYON WATER AND SANITATION DISTRICT RECONCILIATION OF ACTUAL (Non-GAAP BUDGETARY BASIS) TO STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ENTERPRISE FUND Year Ended December 31, 2016
REVENUE (BUDGETARY BASIS) $ 3,009,648 Sale of property and equipment (26,955) Gain on disposal of captial assets 26,833 Total revenue per statement of revenues, expenses and changes in net position 3,009,526
EXPENDITURES (BUDGETARY BASIS) 3,303,693 Depreciation and amortization 611,055 Acquisition of plant and equipment (1,148,658) Total expenses per statement of revenues, expenses, and changes in net position 2,766,090
Change in net position $ 243,436
36
OTHER INFORMATION
PLATTE CANYON WATER AND SANITATION DISTRICT SCHEDULE OF DEBT SERVICE REQUIREMENTS TO MATURITY GOVERNMENTAL ACTIVITIES LONG-TERM OBLIGATIONS December 31, 2016
Subdistrict No.1 Subdistrict No. 2 $400,000 General $475,000 General Obligation Loan Obligation Loan Dated June 30, 2006 Dated July 15, 2008 Interest rate 3.75% Interest rate 3.50% Totals Interest Due Principal Due Interest Due Principal Due Year Ending May 1 and May 1 and May 1 and May 1 and Total Total December 31, November 1 November 1 November 1 November 1 Interest Principal Total 2017 $ 8,667 $ 19,858 $ 9,738 $ 19,347 $ 18,405 $ 39,205 $ 57,610 2018 7,916 20,609 9,054 20,031 16,970 40,640 57,610 2019 7,136 21,389 8,347 20,738 15,483 42,127 57,610 2020 6,326 22,199 7,615 21,470 13,941 43,669 57,610 2021 5,485 23,039 6,857 22,229 12,342 45,268 57,610 2022 4,614 23,911 6,072 23,013 10,686 46,924 57,610 2023 3,710 24,816 5,259 23,825 8,969 48,641 57,610 2024 2,769 25,755 4,419 24,667 7,188 50,422 57,610 2025 1,794 26,730 3,548 25,538 5,342 52,268 57,610 2026 783 27,742 2,646 26,439 3,429 54,181 57,610 2027 - - 1,713 27,371 1,713 27,371 29,084 2028 - - 745 28,340 745 28,340 29,085 $ 49,200 $ 236,048 $ 66,013 $ 283,008 $ 115,213 $ 519,056 $ 634,269
37
RECORD OF PROCEEDINGS
MINUTES OF JOINT REGULAR MEETING
BOARD OF DIRECTORS
SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT1
AND
PLATTE CANYON WATER AND SANITATION DISTRICT
Friday February 24, 2017 Jefferson County, Colorado
The regular monthly meeting of the Board of Directors of the Southwest Metropolitan Water and Sanitation District (“Southwest”) and the Board of Directors of the Platte Canyon Water and Sanitation District (“Platte Canyon”) convened on Friday, February 24, 2017, at 8:30 a.m. in the Districts’ office located at 8739 West Coal Mine Avenue, Littleton, Colorado 80123. Although jointly conducted, a portion of the meeting pertained solely to one District or the other and, accordingly, at times only the vote of one Board or the other was required.
The following Southwest Directors were in attendance, to-wit:
Anthony M. Dursey George E. Hamblin, Jr. Chuck Hause
The following Platte Canyon Directors were in attendance, to wit:
William Buckner Anthony M. Dursey Louis J. Fohn George E. Hamblin, Jr. Richard Rock
The following Platte Canyon staff members were in attendance: Patrick J. Fitzgerald, manager; Vanessa Shipley, financial administrator; Scott Hand, operations
1 and each District’s Water and Sanitary Sewer Activity Enterprise. {00553963.DOCX / }
RECORD OF PROCEEDINGS
supervisor; Tony Cocozzella, construction, plan review and special projects coordinator; and Alyssa Quinn, administrative assistant.2
Also in attendance were: Rich H. Cassens, from ENS Consulting, LLC, Platte Canyon’s consulting engineer; and Timothy J. Flynn, from Collins Cockrel & Cole, P.C., legal counsel for both Districts.
CALL TO ORDER
The meeting was called to order by Director Anthony M. Dursey, who presided as Chair.
SOUTHWEST ACTION ITEMS
1. Approval of Southwest Agenda. Following a brief discussion, a motion was made by Southwest Director Hause and seconded by Southwest Director Hamblin to approve the Southwest agenda, as presented. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
2. Directors’ Absence Excused. Following a brief discussion, a motion was made by Southwest Director Hamblin and seconded by Southwest Director Hause to excuse the absence of Southwest Directors Kenton C. Ensor, Jr and Bernard J. Sebastian, Jr who were unable to attend the meeting. The chair called for a vote for the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
3. Southwest Accounts Payable. The Boards reviewed a list and supplemental list of Southwest vouchers paid (checks under $2,500) and payable for the month of February 2017, in the aggregate amount of $265,719.41, represented by Southwest check numbers 18638 through 18660, inclusive, including two electronic fund transfers in payment of Xcel Energy bills.
2 Southwest has no employees. The above-named personnel are Platte Canyon employees who, pursuant to contract with Platte Canyon, provide management, operation and maintenance services for Southwest. {00553963.DOCX / } 2
RECORD OF PROCEEDINGS
Following a brief discussion, a motion was made by Southwest Director Hause and seconded by Southwest Director Hamblin to ratify, approve, and confirm the vouchers paid and payable, as presented, and to authorize Southwest Directors to execute checks in payment of the payables. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
4. Southwest Investment/Deposit Transaction Report. The Boards reviewed the Schedule of Investment Principal Activity for Southwest for the month of January 2017, which reflects the following transactions:
(a) New Purchases. No treasury notes or agency securities were purchased by Southwest during the month;
(b) Redemptions. No investment securities matured, or were redeemed, or sold by Southwest during the month;
(c) Renewals. On January 7, 2017, Southwest renewed a $249,000. Certificate of Deposit at Centennial Bank and Trust for a period of one year. The Certificate of Deposit will mature on January 7, 2018, and earns interest at the rate of 0.8% per annum.
At the conclusion of the above-referenced investment transactions, a motion was made by Southwest Director Hamblin and seconded by Southwest Director Hause to ratify, approve, and confirm the Southwest Investment Principal Activity Report for the month of January 2017. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
5. Approval of Intergovernmental Funding Agreement with Jefferson County for the Chatfield Avenue Road Improvement and Water Main Replacement Project. The manager and legal counsel reviewed a proposed Intergovernmental Agreement between Jefferson County and Southwest for the improvement of West Chatfield Avenue between South Kendall Boulevard and South Pierce Street and the replacement of Southwest’s water main within that stretch of the road improvement {00553963.DOCX / } 3
RECORD OF PROCEEDINGS
project. A portion of Jefferson County’s road improvement project conflicts with Southwest’s existing 8” asbestos cement water line pipe which needs to be relocated in order to accommodate the road improvement project. A portion of the existing Southwest water main does not need to be relocated, but Southwest would like to replace it nonetheless, all as part of one relocation project. Pursuant to the IGA that has been negotiated, Jefferson County will pay 50% of the design and construction cost for that portion of Southwest’s 8” diameter water main that is incompatible with the road improvement project. Southwest will pay 100% of the design and construction cost for that portion of the existing 8” water main that is not incompatible with the road improvement project. The relocation cost for the entire water main is estimated to be approximately $328,815.00. Southwest’s share of that cost will be approximately $214,115.00.
Under the proposed IGA, Jefferson County will award a contract for the construction of not only the road improvements, but also the relocation of Southwest’s water main. Southwest will pay its proportionate share of the contract amount in accordance with the terms of the proposed agreement. As a result of the proposed agreement that has been negotiated, Southwest will be able to replace its existing 8” asbestos cement water line for the full length of the road improvement project at much less cost than if Jefferson County did not participate in the water main relocation.
At the conclusion of the discussion, a motion to approve the Intergovernmental Agreement and to authorize its signature by appropriate officers of Southwest was made by Southwest Director Hause and seconded by Southwest Director Hamblin. The Chair called for a vote at the Southwest board conference, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
SOUTHWEST INFORMATION/DISCUSSION ITEMS
There were no information or discussion items to come before the Southwest Board.
SOUTHWEST NEW BUSINESS
There was no new business to come before the Southwest Board.
{00553963.DOCX / } 4
RECORD OF PROCEEDINGS
JOINT PARTICIPATION PORTION OF THE MEETING
Southwest Director Anthony M. Dursey continued to act as chair for the joint participation portion of the meeting.
JOINT MEETING ACTION ITEMS
1. Approval of Joint Meeting Agenda. Following a brief discussion, a motion was made by Southwest Director Hamblin and seconded by Platte Canyon Director Buckner to approve, as presented, the agenda for the joint participation portion of the meeting. The chair called for a vote of the Southwest Board and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
The Chair then called for a vote of the Platte Canyon Board, and the vote was as follows: William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
2. Approval of the Minutes of the Board’s January 27, 2017 Joint Regular Meeting. Following a brief discussion, a motion was made by Southwest Director Hause and seconded by Platte Canyon director Buckner to approve, as written, the minutes of the Board’s January 27, 2017, joint regular meeting. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
The Chair then called for a vote of the Platte Canyon Board, and the vote was as follows:
{00553963.DOCX / } 5
RECORD OF PROCEEDINGS
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
The approved minutes of the Boards’ January 27, 2017 joint regular meeting were then presented to the members of each Board for signature as further evidence of ratification, confirmation, and approval.
JOINT MEETING INFORMATION/DISCUSSION ITEMS
1. Financial Matters.
(a) Platte Canyon Financial Statements. The following unaudited Platte Canyon financial statements, prepared by Vanessa Shipley for the one-month period ending January 31, 2017, were presented to the Boards:
(i) Statement of Net Assets, dated January 31, 2017, showing Platte Canyon’s Assets, Liabilities, and Net Assets;
(ii) Statement of Revenue, Expenses, and Changes in Net Assets for the one-month period ending January 31, 2017;
(iii) Schedule of Revenue and Expenditures – Budget & Actual CM/YTD Actuals Compared to Annual Budget for the one-month period ending January 31, 2017; and
(iv) Schedule of Revenue and Expenditures – Budget & Actual CM/YTD Actuals Compared to CM/YTD Budget for the one-month period ending January 31, 2017.
There being only one month of activity reported in the financial statements, Vanessa Shipley had no comments. After a brief discussion, a motion was made by Platte Canyon Director Rock and seconded by Platte Canyon Director Buckner to accept the Platte Canyon financial statements as presented. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
{00553963.DOCX / } 6
RECORD OF PROCEEDINGS
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
(b) Southwest Financial Statements. The following unaudited Southwest financial statements prepared by Vanessa Shipley for the one-month period ending January 31, 2017 were presented to the Boards:
(i) Statement of Net Assets, dated January 31, 2017, showing Southwest’s Assets, Liabilities, and Net Assets;
(ii) Statement of Revenue, Expenses, and Changes in Net Assets for the one-year month period ending January 31, 2017;
(iii) Schedule of Revenue and Expenditures – Budget & Actual CM/YTD Actuals Compared to Annual Budget for the one-month period ending January 31, 2017; and
(iv) Schedule of Revenue and Expenditures – Budget & Actual CM/YTD Actuals Compared to CM/YTD Budget for the one-month period ending January 31, 2017.
Vanessa Shipley noted that there was only one month of financial activity reported in the financial statements. Following a brief discussion, a motion was made by Southwest Director Hause and seconded by Southwest Director Hamblin to accept the Southwest financial statements, as presented. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
(c) Platte Canyon Investment/Deposit Report. The Boards reviewed a list of Platte Canyon’s investments in U.S. Government treasury notes, agency securities, certificates of deposit, and money market funds, together with a Report showing the funds Platte Canyon has in approved state depositories and authorized investment pools. As of January 31, 2017, Platte Canyon’s investments and deposits totaled $10,452,554.78, itemized as follows:
{00553963.DOCX / } 7
RECORD OF PROCEEDINGS
Description Amount Percentage Checking $166,358.39 1.59% Certificates of Deposit $994,000.00 9.51% ColoTrust-Prime $0.00 0.00% ColoTrust-Plus $2,853,354.30 27.30% ColoTrust-Trust Account $452,600.57 4.33% Treasury Bills $0.00 0.00% Treasury Notes $999,499.77 9.56% U.S. Government Agencies and $4,986,741.75 47.71% Instrumentalities TOTAL $10,452,554.78 100.00%
The average yield on Platte Canyon’s investments for the month of January 2017, as calculated by staff, was 1.2186% per annum.
Following a brief discussion, a motion was made by Platte Canyon Director Rock and seconded by Platte Canyon Director Buckner to accept the Platte Canyon Schedule of Deposits and Investments, as presented. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
(d) Southwest Investment/Deposit Report. The Boards reviewed a list of Southwest’s investments in U.S. Government treasury notes, agency securities, certificates of deposit, and money market funds, together with a Report showing the funds Southwest has in approved state depositories and authorized investment pools. As of January 31, 2017, Southwest’s investments and deposits totaled $24,743,974.07, itemized as follows:
{00553963.DOCX / } 8
RECORD OF PROCEEDINGS
Description Amount Percentage Checking $32,692.61 0.13% Certificates of Deposit $2,341,537.80 9.46% ColoTrust-Prime $0.00 0.00% ColoTrust-Plus $2,562,723.06 10.36% ColoTrust-Trust Account $3,739,180.63 15.11% Treasury Bills $0.00 0.00% Treasury Notes $6,025,206.20 24.35% U.S. Government Agencies and $10,042,692.77 40.59% Instrumentalities TOTAL $24,743,974.07 100.00%
The average yield on Platte Canyon’s investments for the month of January 2017, as calculated by staff, was 1.7896% per annum.
Following a brief discussion, a motion was made by Southwest Director Hause and seconded by Southwest Director Hamblin to accept the Southwest Schedule of Deposits and Investments, as presented. The Chair called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
2. Manager’s Information Report. The manager reviewed the Manager’s Information Report, dated February 2017, a copy of which was previously provided to both Boards. As part of his report, the manager highlighted the following matters:
(a) Personnel Matters/Assistant Manager. After going through an extensive selection process, the manager made an offer for the assistant manager position to a person currently employed by the American Water Works Association. She underwent an extensive background check and interviewed with all staff; everyone is very excited about her coming on board. It is expected that she will start sometime towards the end of March 2017.
(b) Newsletters. Barrie Brinkley is in the process of finalizing the first draft of the 2017 Newsletter for both Southwest and Platte Canyon. The draft will be submitted to the Boards for their review very soon. Director Dursey suggested that the
{00553963.DOCX / } 9
RECORD OF PROCEEDINGS
newsletter include some information, at least with respect to Southwest, as to how the Southwest’s residents’ sanitary sewer bills compare with other districts in the area, especially since Southwest has no property tax mill levy and only recently implemented a charge that is collected on everyone’s water bill by Denver Water.
(c) Platte Canyon Purchase of Property Adjacent to the Scott J. Morris Water Pump Station Property from Denver Water. The manager reported that Denver Water’s staff has now made a determination that the property Platte Canyon wants to acquire from Denver Water adjacent to the Scott J. Morris Water Pump Station on Ken Caryl Avenue, is surplus and is available for sale. The next step in the process is for staff to submit the matter to the Board of Water Commissioners for authorization to sell the property. It is expected that this will happen soon. Once this occurs, then legal counsel for Platte Canyon will work with Denver Water in filing a condemnation action to acquire the property without an extensive subdivision exemption process through the Jefferson County Planning Department.
(d) Remodel of Southwest/Platte Canyon Office. During the month, Genterro LLC and its subcontractors made substantial progress in completing the Southwest office remodel project. Alyssa Quinn gave the Boards a brief update, noting that it appears that most of the major work is at least 80% complete. There are some minor items that need to be completed. A check in partial payment of the amount owed to Genterro to date was approved by Southwest as part of the Southwest payables. This check will be not be released to Genterro until appropriate lien waivers have been obtained from the various subcontractors who have furnished work and materials on the project. The manager expressed his expectation and hope that the project will be completed in the very near future and within the initial projected budget, although the time for completion is approximately 3 months beyond the schedule as initially contemplated.
(e) Valley Sanitation District Sanitary Sewer Outfall Line. During February, Alyssa Quinn, Scott Morris, Tony Cocozzella and the manager participated in the first of three open houses designed to educate Valley Sanitation District customers concerning the status of the district’s outfall sewer interceptor line. The outfall line extends over and across property that was part of an Englewood land fill and currently needs to be relocated. The work will cost approximately $2 million and will require the electors of the Valley Sanitation District to authorize the district to incur debt in approximately that amount. Only twenty-one residents attended the session; however, there were members of the media there, and as a result, the meeting and the condition of the sewer interceptor line got a great deal of publicity. It is anticipated that more residents will attend the next two open houses.
{00553963.DOCX / } 10
RECORD OF PROCEEDINGS
(f) Revised Residential Assessment Rate. The manager report updated the Boards on what now appears to be a certainty that the residential assessment rate for determining the assessed valuation within all special districts and taxing areas will drop from 7.96% of actual estimated market value to 5.9%. South Suburban recently completed a study which shows that South Suburban may lose as much as $2 million in 2018 as a result of the reduction in the residential assessment rate. The adjustment in the residential assessment rate is the result of the Gallagher Amendment. Platte Canyon staff is in the process of evaluating the impact the new residential assessment rate will have on Platte Canyon and the other districts that Platte Canyon manages that are dependent on property tax revenues for operating expenses.
3. Operations and Maintenance Summary Report. Scott Hand reviewed the Operations and Maintenance Summary Report for January 2017. For the January reporting period, neither Platte Canyon nor Southwest had any sanitary sewer service interruptions. Platte Canyon had one water service interruption at 7215 South Platte Canyon Drive, and Southwest had one water service interruption at 5612 South Ward Street. Mr. Hand presented a PowerPoint presentation showing the repair activities that were undertaken to respond to these water line breaks.
During January, Mr. Hand and Armando Quintana attended an Emergency Services Workshop Training session at the Adams County government offices. The focus of the training session was to study scenarios and actions that could be taken in the event of a major water supply loss as a result of a catastrophic event.
In addition, Mr. Hand, Pat Fitzgerald, Tony, Alyssa and Armando attended the Denver Water Distributor Portal training which was held on January 26, 2017. At that training session, Denver Water staff reviewed how to access the Distributor Portal for Southwest and Platte Canyon and in other distributor districts, and indicated what contents would be placed on the portal website.
Finally, Mr. Hand provided an update of the rehabilitation project at the Platte Canyon Scott J. Morris Water Pump Station on Ken Caryl Avenue. During the month, an incident occurred where flash fill accidentally got into the new suction main being installed for the Pump Station. Glacier, the contractor, had to re-excavate and replace approximately 12 feet of pipe. The project, however, is still on schedule and it is expected that testing of the components of the new pump station will begin in late February or early March.
4. Construction Project Report. Tony Cocozzella reviewed with both Boards the Construction Status Report for both Platte Canyon and Southwest. The
{00553963.DOCX / } 11
RECORD OF PROCEEDINGS
Report updated the Boards as to the status of all on-going Platte Canyon and Southwest projects, including developer and District-specific projects. As part of the review, Mr. Cocozzella also addressed those projects that are in design-phase at the present time.
NEW BUSINESS
There was no new business to come before the joint participation portion of the meeting. The next joint regular meeting of the Boards is scheduled for Friday, March 24, 2017 in the Districts’ offices located at 8739 West Coal Mine Avenue, Littleton, Colorado 80123. Mr. Flynn asked the Boards if it would be possible to reschedule the April meeting from April 28 to April 21 due to vacation plans that he has. Those Board members present indicated that they did not think it would be a problem. This matter will be discussed by both Boards in greater detail at the March regular meeting.
PLATTE CANYON ACTION ITEMS
CALL TO ORDER
The Platte Canyon Action Items portion of the joint meeting was called to order by Platte Canyon Director Richard Rock, who presided as Chair.
1. Approval of Platte Canyon Agenda. Following a brief discussion, a motion was made by Platte Canyon Director Buckner and seconded by Platte Canyon Director Fohn to approve, as presented, the Platte Canyon agenda. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
2. Platte Canyon Accounts Payable. The Boards reviewed a list and supplemental list of Platte Canyon vouchers paid and payable for the month of February 2017, in the aggregate amount of $66,988.34, represented by Platte Canyon check nos. 30981 through 31029, inclusive, together with various electronic payments for employee salaries, utility payments, and other authorized electronic fund payment vendors approved for electronic ACH payments.
Following a brief discussion, a motion was made by Platte Canyon Director Dursey and seconded by Platte Canyon Director Buckner to: (a) ratify, approve, and
{00553963.DOCX / } 12
RECORD OF PROCEEDINGS
confirm all checks written and all electronic fund transfers occurring since the Platte Canyon January 17, 2017 joint regular meeting, including all checks written by the manager for less than $2,500.00; and (b) approve for payment the payables presented to the Platte Canyon Board at this meeting, which motion included authority for Platte Canyon Directors to execute checks in payment thereof. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
3. Platte Canyon Investment/Deposit Transaction Report. The Boards reviewed the schedule of investment principal activity for Platte Canyon for the month of January 2017, which reflects the following transactions:
(a) New Purchases. No treasury notes or agency securities were purchased by Platte Canyon during the month;
(b) Redemptions. During the month, a Centennial Bank Certificate of Deposit in the amount of $249,000.00 matured, generating a total of $249,000.00 plus accrued interest to Platte Canyon; and
(c) Renewals. No certificates of deposit were renewed or rolled over during the month.
At the conclusion of Vanessa Shipley’s discussion of the above-referenced Investment/Deposit Transaction Report, a motion was made by Platte Canyon Director Dursey and seconded by Platte Canyon Director Fohn to accept the Platte Canyon investment principal activity for the month of January 2017. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
{00553963.DOCX / } 13
RECORD OF PROCEEDINGS
PLATTE CANYON INFORMATION/DISCUSSION ITEMS
There were no Platte Canyon information or discussion items to come before the Platte Canyon Board.
PLATTE CANYON NEW BUSINESS
There was no new business to come before the Platte Canyon Board.
ADJOURNMENT
There being no further business to come before this joint regular meeting of the Platte Canyon and Southwest Boards, a motion to adjourn was made by Southwest Director Dursey and seconded by Platte Canyon Director Fohn. The Chair called for a vote of the Platte Canyon Board, and the vote was as follows:
William Buckner Aye Anthony M. Dursey Aye Louis J. Fohn Aye George E. Hamblin, Jr. Aye Richard Rock Aye
The Chair then called for a vote of the Southwest Board, and the vote was as follows:
Anthony M. Dursey Aye George E. Hamblin, Jr. Aye Chuck Hause Aye
Whereupon, this joint regular meeting of the Southwest and Platte Canyon Boards of Directors adjourned at approximately 9:45 a.m. The next joint regular meeting of the Boards will be held on Friday, March 24, 2017, at 8:30 a.m. in the Districts’ office, located at 8739 West Coal Mine Avenue, Littleton, Colorado 80123.
Respectfully submitted,
Timothy J. Flynn, Recording Secretary
{00553963.DOCX / } 14
RECORD OF PROCEEDINGS
THE MINUTES OF THIS JOINT REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT AND THE BOARD OF DIRECTORS OF THE PLATTE CANYON WATER AND SANITATION DISTRICT ARE HEREBY RATIFIED, CONFIRMED AND APPROVED BY THE FOLLOWING NAMED INDIVIDUALS WHO, INDIVIDUALLY AND AS MEMBERS OF THE BOARD OF DIRECTORS OF SAID DISTRICTS, WAIVE ANY AND ALL NOTICE THAT MAY BE REQUIRED BY THE STATUTES OF THE STATE OF COLORADO PERTAINING TO THE CONVENING AND THE CONDUCTING OF THIS REGULAR MEETING OF THE DISTRICT’S BOARD OF DIRECTORS; AND THE UNDERSIGNED DO HEREBY CONSENT TO THE SAID MEETING BEING HELD ON THE DATE, AT THE TIME AND AT THE PLACE AS HEREINABOVE SET FORTH.
SOUTHWEST METROPOLITAN PLATTE CANYON WATER AND WATER AND SANITATION DISTRICT SANITATION DISTRICT
Anthony M. Dursey William D. Buckner
Kenton C. Ensor, Jr. Anthony M. Dursey
George E. Hamblin, Jr. Louis J. Fohn
Chuck Hause George E. Hamblin, Jr.
Bernard J. Sebastian, Jr. Richard Rock
{00553963.DOCX / } 15
Platte Canyon Water & Sanitation District Statement of Net Assets February 28, 2017
ASSETS
CURRENT ASSETS Cash - Checking $225,068.00 Petty Cash 150.00 Certificates of Deposit 994,000.00 Investments 6,000,000.00 Fair Market Value Adjustment (67,991.33) ColoTrust Plus Account 2,575,314.51 ColoTrust - Trust Account 463,793.38 Cash County Treasury 528,659.55 Accounts Receivable 34,157.54 Prepaid Insurance 51,552.31 Accrued Interest Receivable 10,277.13 Deferred Interest (13,257.02) Total current assets 10,801,724.07
OTHER ASSETS Prepaid Lease (Office/Maint. Building) 363,051.08 Total other assets 363,051.08
CAPITAL ASSETS Land 5,000.00 Mains, Plant Equip. Sewer 9,339,930.27 Mains, Plant Equip. Water 12,183,094.09 Maintenance Equipment 1,431,554.84 District Office Equipment 249,014.56 Software 122,137.79 Pump Station 274,240.16 Construction in Process 1,093,269.83 24,698,241.54 Accumulated Depreciation (14,749,551.14) Total capital assets $9,948,690.40
TOTAL ASSETS $21,113,465.55
UNAUDITED 1 Platte Canyon Water & Sanitation District Statement of Net Assets February 28, 2017
LIABILITIES & NET ASSETS
CURRENT LIABILITIES Accounts Payable $15,096.76 Salaries Payable 38,755.49 Vacation & Sick Leave Payable 83,981.81 Merit Payable 217,226.50 Colorado Withholding Payable 1,474.00 Total current liabilities 356,534.56 NET ASSETS Net Assets - Beginning of Year Invested in capital assets 9,835,551.32 Restricted 89,500.00 Unrestricted 10,473,753.79 Change in net assets - current year 320,887.03
TOTAL NET ASSETS $20,719,692.14
2 Platte Canyon Water & Sanitation District Statement of Revenue, Expenses, and Changes in Net Assets For the Two Months Ending February 28, 2017
OPERATING REVENUE Sewer Transmission Revenue $1,290.00 Contract Maintenance 135,598.70 Total operating revenue $136,888.70 OPERATING EXPENSES Wages $169,130.32 Payroll Taxes 10,104.63 CCOERA Retirement 9,260.22 Personnel Insurance 44,223.76 Communications 1,779.68 Equipment & Vehicles 15,532.67 Insurance 7,108.77 Maintenance Supplies 2,925.68 Depreciation 98,594.57 Office Expenses 17,989.12 Consulting 11,016.00 Engineering Fees - GIS 2,760.13 Legal Fees 2,094.50 Software Management 4,132.28 Miscellaneous 900.00 Sewer Maintenance & Operation 150.00 Utility Notification - sewer 218.95 Water Maintenance & Operation 47.25 Pump Station Maintenance & Operation 1,570.91 Water Contract Emergencies 6,444.80 Utility Notification - water 218.95 Repair and maint - Office/Maint Bldg 1,200.00 Office/Maint Building lease amortization 2,576.74 Direct billed expenses 329.33 Total operating expenses 410,309.26 (LOSS) FROM OPERATIONS (273,420.56)
NONOPERATING REVENUE Tax Revenue 579,519.00 Net Investment Income 20,770.68 Miscellaneous Income 2,394.90 Total nonoperating revenue 602,684.58
NONOPERATING EXPENSES Treasurer's Fees 8,376.99 Total nonoperating expenses 8,376.99 INCOME (LOSS) BEFORE CONTRIBUTIONS 320,887.03
CAPITAL CONTRIBUTIONS
CHANGE IN NET ASSETS 320,887.03 NET ASSETS - BEGINNING OF YEAR 20,398,805.11 NET ASSETS - ENDING $20,719,692.14
3 Platte Canyon Water & Sanitation District Schedule of Revenue and Expenditures - Budget & Actual CM/YTD Actuals Compared to Annual Budget For the Two Months Ending February 28, 2017
CURRENT YEAR TO DATE ANNUAL VARIANCE MONTH ACTUAL BUDGET Favorable (Unfavorable)
REVENUE Taxes $536,724.95 $579,519.00 $1,383,122.00 ($803,603.00) Contract Maintenance 116,760.24 135,598.70 1,230,472.00 (1,094,873.30) Sewer Transmission Fees 1,290.00 2,580.00 (1,290.00) Tap Fees - Sewer 19,000.00 (19,000.00) Miscellaneous (5.10) 2,394.90 1,500.00 894.90 Net Investment Income 9,331.12 20,770.68 105,260.00 (84,489.32) TOTAL REVENUE $662,811.21 $739,573.28 $2,741,934.00 ($2,002,360.72) OPERATING EXPENDITURES PERSONNEL Wages $81,999.84 $169,130.32 $1,146,450.00 $977,319.68 Payroll Taxes 6,900.63 10,104.63 91,145.00 81,040.37 CCOERA Retirement 6,348.32 9,260.22 89,135.00 79,874.78 Personnel Insurance 22,429.06 44,223.76 306,150.00 261,926.24 COMMUNICATIONS Communications 145.79 1,779.68 20,300.00 18,520.32 VEHICLES & EQUIPMENT Vehicles & Equipment 8,618.34 15,532.67 88,500.00 72,967.33 INSURANCE Insurance 3,534.95 7,108.77 48,550.00 41,441.23 MAINTENANCE SUPPLIES 1,689.62 2,925.68 25,500.00 22,574.32 OFFICE EXPENSES Office Expenses 6,676.17 17,989.12 92,360.00 74,370.88 PUBLIC RELATIONS 15,400.00 15,400.00 PROFESSIONAL & CONSULTING Audit Fees 7,000.00 7,000.00 Consulting 7,500.00 7,500.00 10,000.00 2,500.00 Consulting - TAC 3,516.00 7,500.00 3,984.00 Engineering Fees 1,000.00 1,000.00 Engineering Fees - GIS 2,760.13 2,760.13 30,000.00 27,239.87 Legal Fees 2,094.50 2,094.50 35,000.00 32,905.50 Software Management 1,933.99 4,132.28 50,000.00 45,867.72 TREASURERS FEES 7,895.48 8,376.99 22,303.00 13,926.01 DIRECTORS FEES 500.00 900.00 6,000.00 5,100.00 MISCELLANEOUS 250.00 250.00 SEWER OPERATIONS Sewer Mntc. & Operation 150.00 18,000.00 17,850.00 Sewer Contract Emergencies 15,000.00 15,000.00 Sewer Contract Remedial 25,000.00 25,000.00 Utility Notification - sewer 139.20 218.95 3,000.00 2,781.05 WATER OPERATIONS Water Mntc. & Operation 47.25 13,000.00 12,952.75 Pump Station Mntc & Oper. 393.75 1,570.91 21,000.00 19,429.09 Water Contract Emergencies 850.00 6,444.80 55,000.00 48,555.20 Water Contract Remedial 62,000.00 62,000.00 Utility Notification - water 139.20 218.95 3,000.00 2,781.05 REPAIR & MAINT - OFFICE/MAINT BLDG. 600.00 1,200.00 20,100.00 18,900.00 DIRECT BILLED EXPENSES 329.33 (329.33) TOTAL OPERATING EXPENDITURES $163,148.97 $317,514.94 $2,327,643.00 $2,010,128.06
4 Platte Canyon Water & Sanitation District Schedule of Revenue and Expenditures - Budget & Actual CM/YTD Actuals Compared to Annual Budget For the Two Months Ending February 28, 2017
CURRENT YEAR TO DATE ANNUAL VARIANCE MONTH ACTUAL BUDGET Favorable (Unfavorable)
CAPITAL OUTLAY MAINS, PLANT EQUIP SEWER Sewer Rehabilitation $25,000.00 $25,000.00 S. Depew St. Rehabilitation 3,943.34 140,042.00 136,098.66 W. Plymouth Dr. Rehabilitation 1,248.33 109,285.00 108,036.67 S. Gray Ct. Rehabilitation 1,248.33 120,510.00 119,261.67
MAINS, PLANT EQUIP WATER W. Canyon Dr. Replacement 2,495.00 171,465.00 168,970.00 S. Morning Glory Ln. Replacement 3,700.00 335,685.00 331,985.00 W. Frost Dr. Replacement 12,000.00 12,000.00
MAINTENANCE EQUIPMENT Maintenance Computer Equipment 6,000.00 6,000.00 Pickup 3/4 ton 4WD Other Equipment 14,300.00 14,300.00
DISTRICT OFFICE EQUIPMENT Office Computer Equipment 6,000.00 6,000.00 Copier Other Equipment/Office Furniture 5,000.00 5,000.00
SOFTWARE GIS Software Office Software Maintenance Software
PUMP STATION Col. West Pump Station Improvements 184,974.50 199,098.65 679,013.00 479,914.35
CONTINGENCY/EMERGENCY RESERVE 327,434.00 327,434.00 TOTAL CAPITAL OUTLAY $184,974.50 $211,733.65 $1,951,734.00 $1,740,000.35 TOTAL EXPENDITURES $348,123.47 $529,248.59 $4,279,377.00 $3,750,128.41
REVENUE OVER (UNDER) EXPENDITURES $314,687.74 $210,324.69 ($1,537,443.00) $1,747,767.69
BEGINNING FUNDS AVAILABLE $10,197,625.97 $10,197,625.97 ENDING FUNDS AVAILABLE $10,407,950.66 $8,660,182.97
5 Platte Canyon Water & Sanitation District Schedule of Revenue and Expenditures Budget & Actual CM/YTD Actuals Compared to CM/YTD Budget For the Two Months Ending February 28, 2017
------CURRENT MONTH------YEAR TO DATE------ACTUAL BUDGET VARIANCE ACTUAL BUDGET VARIANCE Favor(Unfavor)
REVENUE Taxes $536,724.95 $319,353.33 $217,371.62 $579,519.00 $364,706.66 $214,812.34 Contract Maintenance 116,760.24 102,539.34 14,220.90 135,598.70 121,298.51 14,300.19 Sewer Transmission Fees 1,290.00 1,290.00 Miscellaneous (5.10) 125.00 (130.10) 2,394.90 250.00 2,144.90 Net Investment Income 9,331.12 8,771.67 559.45 20,770.68 17,543.34 3,227.34 TOTAL REVENUE $662,811.21 $430,789.34 $232,021.87 $739,573.28 $505,088.51 $234,484.77 OPERATING EXPENDITURES PERSONNEL Wages $81,999.84 $95,537.50 $13,537.66 $169,130.32 $191,075.00 $21,944.68 Payroll Taxes 6,900.63 7,308.75 408.12 10,104.63 14,617.50 4,512.87 CCOERA Retirement 6,348.32 7,427.92 1,079.60 9,260.22 14,855.84 5,595.62 Personnel Insurance 22,429.06 25,512.50 3,083.44 44,223.76 51,025.00 6,801.24 COMMUNICATIONS Communications 145.79 1,691.67 1,545.88 1,779.68 3,383.34 1,603.66 VEHICLES & EQUIPMENT Vehicles & Equipment 8,618.34 7,375.00 (1,243.34) 15,532.67 14,750.00 (782.67) INSURANCE Insurance 3,534.95 4,045.83 510.88 7,108.77 8,091.66 982.89 MAINTENANCE SUPPLIES 1,689.62 2,125.00 435.38 2,925.68 4,250.00 1,324.32 OFFICE EXPENSES Office Expenses 6,676.17 7,696.67 1,020.50 17,989.12 15,393.34 (2,595.78) PUBLIC RELATIONS 208.33 208.33 416.66 416.66 PROFESSIONAL & CONSULTING Audit Fees 7,000.00 7,000.00 7,000.00 7,000.00 Consulting 7,500.00 7,000.00 (500.00) 7,500.00 7,833.33 333.33 Consulting - TAC 3,516.00 7,500.00 3,984.00 Engineering Fees 83.33 83.33 166.66 166.66 Engineering Fees - GIS 2,760.13 2,500.00 (260.13) 2,760.13 5,000.00 2,239.87 Legal Fees 2,094.50 2,916.67 822.17 2,094.50 5,833.34 3,738.84 Software Management 1,933.99 3,750.00 1,816.01 4,132.28 7,500.00 3,367.72 TREASURERS FEES 7,895.48 5,768.62 (2,126.86) 8,376.99 7,750.47 (626.52) DIRECTORS FEES 500.00 500.00 900.00 1,000.00 100.00 MISCELLANEOUS 50.00 50.00 50.00 50.00 SEWER OPERATIONS Sewer Mntc. & Operation 1,500.00 1,500.00 150.00 3,000.00 2,850.00 Sewer Contract Emergencies 1,250.00 1,250.00 2,500.00 2,500.00 Sewer Contract Remedial 2,083.33 2,083.33 4,166.66 4,166.66 Utility Notification - sewer 139.20 250.00 110.80 218.95 500.00 281.05 WATER OPERATIONS Water Mntc. & Operation 1,083.33 1,083.33 47.25 2,166.66 2,119.41 Pump Station Mntc & Oper. 393.75 1,750.00 1,356.25 1,570.91 3,500.00 1,929.09 Water Contract Emergencies 850.00 4,583.33 3,733.33 6,444.80 9,166.66 2,721.86 Water Contract Remedial 5,166.67 5,166.67 10,333.34 10,333.34 Utility Notification - water 139.20 250.00 110.80 218.95 500.00 281.05 REPAIR & MAINT - OFFICE/MAINT BLDG 600.00 1,675.00 1,075.00 1,200.00 3,350.00 2,150.00 DIRECT BILLED EXPENSES 329.33 (329.33) TOTAL OPERATING EXPENDITURES $163,148.97 $208,089.45 $44,940.48 $317,514.94 $406,675.46 $89,160.52
6 Platte Canyon Water & Sanitation District Schedule of Revenue and Expenditures Budget & Actual CM/YTD Actuals Compared to CM/YTD Budget For the Two Months Ending February 28, 2017
------CURRENT MONTH------YEAR TO DATE------ACTUAL BUDGET VARIANCE ACTUAL BUDGET VARIANCE Favor(Unfavor)
CAPITAL OUTLAY MAINS, PLANT EQUIP SEWER Sewer Rehabilitation S. Depew St. Rehabilitation 3,943.34 5,000.00 1,056.66 W. Plymouth Dr. Rehabilitation 1,248.33 3,000.00 1,751.67 S. Gray Ct. Rehabilitation 1,248.33 3,000.00 1,751.67 MAINS, PLANT EQUIP WATER W. Canyon Dr. Replacement 2,495.00 5,000.00 2,505.00 S. Morning Glory Ln. Replacement 3,700.00 5,000.00 1,300.00 W. Frost Dr. Replacement MAINTENANCE EQUIPMENT Maintenance Computer Equipment Pickup 3/4 ton 4WD Other Equipment
DISTRICT OFFICE EQUIPMENT Office Computer Equipment Copier Other Equipment/Office Furniture
SOFTWARE GIS Software Office Software Maintenance Software
PUMP STATION Col. West Pump Station Improvements 184,974.50 250,000.00 65,025.50 199,098.65 300,000.00 100,901.35 EMERGENCIES 27,286.17 27,286.17 54,572.34 54,572.34 TOTAL CAPITAL OUTLAY $184,974.50 $277,286.17 $92,311.67 $211,733.65 $375,572.34 $163,838.69 TOTAL EXPENDITURES $348,123.47 $485,375.62 $137,252.15 $529,248.59 $782,247.80 $252,999.21
REVENUE OVER (UNDER) EXPENDITURES $314,687.74 ($54,586.28) $369,274.02 $210,324.69 ($277,159.29) $487,483.98
BEGINNING FUNDS AVAILABLE $10,197,625.97 $10,197,625.97 ENDING FUNDS AVAILABLE $10,407,950.66 $9,920,466.68
7 Platte Canyon Water & Sanitation District Cumulative Monthly Revenues 2017 Compared to 2016
3500
3000 2016
2500 2015
2000 Dollars
Thousands 1500
1000
500
0.020 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Platte Canyon Water & Sanitation District Cumulative Monthly Expenses (Inclusive of capital outlay) 2017 Compared to 2016 3500
2016 3000 2015 2500
2000 Dollars Thousands 1500
1000
500
0 Jan Mar May Jul Sep Nov Feb Apr Jun Aug Oct Dec Platte Canyon Water & Sanitation District Cumulative Revenues and Operating Expenditures Compared to Budget and YTD Capital Outlay January 2017 to December 2017
3500 Actual Revenue
3000 Budget Revenue
2500 Actual Expense
2000 Budget Expense
Dollars Capital
Thousands 1500 Outlay
1000
500
0 Jan Mar May July Sep Nov Feb Apr June Aug Oct Dec Southwest Metropolitan Water & Sanitation District Statement of Net Assets February 28, 2017
CURRENT ASSETS Cash - Checking $1,541.77 Cash - ColoTrust PLUS 2,615,560.57 Cash - Trust Account 3,772,304.85 CD's Non Restricted 2,344,931.04 U.S. Treasuries 16,000,000.00 Fair Market Value Adjustment 126,742.59 Deferred Interest 66,557.66 Accrued Interest Receivable 41,269.76 Accounts Receivable 6,808.18 Prepaid Expenses 8,145.90 Total current assets 24,983,862.32
CAPITAL ASSETS Land and easements 64,818.77 Water System 30,829,140.22 Line Capacity - DWB Contract 4,747,707.90 Sewer System 33,208,355.03 Const. in Process (S) System 941,455.04 Equipment & Tools 34,346.96 Office/Maint Building 2,507,238.15 Office Equipment & Furniture 33,699.29 72,366,761.36 Accumulated Depreciation (32,203,904.62) Total capital assets 40,162,856.74 TOTAL ASSETS $65,146,719.06
UNAUDITED 1 Southwest Metropolitan Water & Sanitation District Statement of Net Assets February 28, 2017
CURRENT LIABILITIES Accounts Payable $16,683.28 Hydrant Deposits 3,550.00 Unearned Backcharges 2,604.86 Warranty Escrow 45,517.25 Total current liabilities 68,355.39
NET ASSETS Net Assets - Beginning of year Invested in capital assets 40,367,960.80 Restricted 34,800.00 Unrestricted 24,858,056.64 Change in net assets - current year (182,453.77) TOTAL NET ASSETS $65,078,363.67
2 Southwest Metropolitan Water & Sanitation District Statement of Revenue, Expenses and Changes in Net Assets For the Two Months Ending February 28, 2017
OPERATING REVENUE OPERATING EXPENSES Office Administration $40,328.12 Social Security 76.50 Dues & Seminars 1,237.50 Office Supplies 563.70 Bank Charges 253.62 Legal Services 3,508.50 Legal Fees - Backcharges 2,840.00 Consulting 7,500.00 Engineering Water 234.84 Engineering Sewer 78.28 Engineering - GIS 2,560.44 Insurance & Bonds 2,762.66 Directors Fees 1,000.00 Repairs & Maint - Office/Maint Bldg. 4,499.28 Utilities & Telephone 5,349.36 Amortization - W&S Systems 48,793.32 Depreciation 260,211.58 Repairs & Maintenance - Water 18,654.52 R&M (W) - Hogback Pump Station 1,445.55 Utilities - Hogback Pump Station 5,370.22 Telemetry - Hogback Pump Station 345.42 R&M (W) Contract - Emergencies 11,037.63 R&M (W) Contract - Remedial 1,737.00 Repairs & Maintenance - Sewer 36,038.67 Utilities - Flow Meters 283.77 Telemetry - Flow Meters 483.37 Utility Notification 926.55 Total operating expenses 458,120.40 (LOSS) FROM OPERATIONS (458,120.40) NONOPERATING REVENUE Net Investment Income 71,525.03 Sewer Lease/City of Littleton 7,500.00 Office Rent Income 1,200.00 Plan review and inspections 9,209.81 W&S Tap Administration Fees 25.00 Other Income 4,504.79 Total nonoperating revenue 93,964.63 INCOME (LOSS) BEFORE CONTRIBUTIONS (364,155.77) CAPITAL CONTRIBUTIONS Tap Fees 181,702.00 Total capital contributions 181,702.00 CHANGE IN NET ASSETS (182,453.77) NET ASSETS - BEGINNING 66,933,321.60 NET ASSETS - ENDING 66,750,867.83
3 Southwest Metropolitan Water & Sanitation District Schedule of Revenue and Expenditures - Budget & Actual CM/YTD Actual Compared to Annual Budget For the Two Months Ending February 28, 2017
CURRENT YEAR TO DATE ANNUAL VARIANCE MONTH ACTUAL BUDGET Favorable (Unfavorable)
REVENUE Investment Income $34,591.83 $71,525.03 $335,744.00 ($264,218.97) Service fee $536,220.00 ($536,220.00) Sewer Lease/City of Littleton 7,500.00 15,000.00 (7,500.00) Office Rent Income 600.00 1,200.00 18,600.00 (17,400.00) Plan Review and Inspections 5,554.60 9,209.81 40,000.00 (30,790.19) W&S Tap Administration Fees 25.00 25.00 25.00 Tap Fees - Water 132,500.00 132,500.00 245,000.00 (112,500.00) Tap Fees - Sewer 47,025.00 49,202.00 38,500.00 10,702.00 Other Income 1,154.79 4,504.79 4,500.00 4.79 TOTAL REVENUE $221,451.22 $275,666.63 $1,233,564.00 ($957,897.37) OPERATING EXPENDITURES GENERAL OFFICE Office Administration $40,328.12 $40,328.12 $470,000.00 $429,671.88 Dues & Seminars 1,237.50 2,000.00 762.50 Office Supplies 563.70 1,500.00 936.30 Public Relations 37,500.00 37,500.00 Legal Notices - Ads 200.00 200.00 Bank Charges 147.03 253.62 (253.62) Miscellaneous 1,550.00 1,550.00 PROFESSIONAL & CONSULTING Audit 6,000.00 6,000.00 Legal Services 3,508.50 3,508.50 35,000.00 31,491.50 Legal fees - Backcharges 2,840.00 2,840.00 5,000.00 2,160.00 Other Consulting 1,000.00 1,000.00 Technical Advisory Committee 7,500.00 15,000.00 7,500.00 Engineering - Backcharges 6,000.00 6,000.00 Engineering Water 234.84 234.84 5,000.00 4,765.16 Engineering Sewer 78.28 78.28 5,000.00 4,921.72 Engineering - GIS 2,560.44 2,560.44 30,000.00 27,439.56 DWD COLLECTION FEE 13,653.00 13,653.00 INSURANCE 1,381.33 2,762.66 14,250.00 11,487.34 DIRECTORS FEES 500.00 1,000.00 6,000.00 5,000.00 SOCIAL SECURITY/MEDICARE 38.25 76.50 480.00 403.50 REPAIR & MAINT - OFFICE/MAINT BLDG. 966.48 4,499.28 30,000.00 25,500.72 UTILITIES & TELEPHONE 1,483.28 5,349.36 32,000.00 26,650.64 WATER OPERATING EXPENDITURES Repairs & Maintenance 13,523.64 18,654.52 320,000.00 301,345.48 R&M - Hogback Pump Station 1,445.55 12,000.00 10,554.45 Utilities - Hogback Pump Station 2,264.82 5,370.22 27,500.00 22,129.78 Telemetry - Hogback Pump Station 250.26 345.42 1,850.00 1,504.58 R&M Contract - Emergencies 11,037.63 11,037.63 100,000.00 88,962.37 R&M Contract - Remedial 1,737.00 1,737.00 81,000.00 79,263.00 SEWER OPERATING EXPENDITURES Repairs & Maintenance 36,038.67 36,038.67 273,000.00 236,961.33 R&M Flow Meters 5,000.00 5,000.00 Utilities - Flow Meters 130.22 283.77 1,750.00 1,466.23 Telemetry - Flow Meters 483.37 483.37 6,000.00 5,516.63 R&M Contract - Emergencies 20,000.00 20,000.00 R&M Contract - Remedial 50,000.00 50,000.00 UTILITY NOTIFICATION 500.25 926.55 9,300.00 8,373.45 TOTAL OPERATING EXPENDITURES $120,032.41 $149,115.50 $1,624,533.00 $1,475,417.50
4 Southwest Metropolitan Water & Sanitation District Schedule of Revenue and Expenditures - Budget & Actual CM/YTD Actual Compared to Annual Budget For the Two Months Ending February 28, 2017
CURRENT YEAR TO DATE ANNUAL VARIANCE MONTH ACTUAL BUDGET Favorable (Unfavorable)
CAPITAL OUTLAY
WATER PROJECTS W. Chatfield Ave. Replacement $212,640.00 $212,640.00 Hogback Pump VFD Replacement 67,850.00 67,850.00 SEWER PROJECTS Sewer Rehabilitation 25,000.00 25,000.00 Dutch Creek Rehabilitation 19,507.19 19,507.19 (19,507.19) W. Chatfield Ave. 123,378.00 123,378.00 W. Coal Mine Ave. 70,208.00 70,208.00 S.C.A.D.A. Comm. & Hardware Upgrade 102,400.00 102,400.00 OFFICE BUILDING IMPROVEMENTS 84,393.65 84,393.65 (84,393.65) CONTINGENCY/EMERGENCIES 127,228.00 127,228.00 TOTAL CAPITAL OUTLAY $103,900.84 $103,900.84 $728,704.00 $624,803.16 TOTAL EXPENDITURES $223,933.25 $253,016.34 $2,353,237.00 $2,100,220.66 REVENUE OVER (UNDER) EXPENDITURES ($2,482.03) $22,650.29 ($1,119,673.00) $1,142,323.29
BEGINNING FUNDS AVAILABLE $24,892,856.64 $24,892,856.64 ENDING FUNDS AVAILABLE $24,915,506.93 $23,773,183.64
5 Southwest Metropolitan Water & Sanitation District Schedule of Revenue and Expenditures Budget & Actual CM/YTD Actual Compared to CM/YTD Budget For the Two Months Ending February 28, 2017
------CURRENT MONTH------YEAR TO DATE------ACTUAL BUDGET VARIANCE ACTUAL BUDGET VARIANCE Favor(Unfavor)
REVENUE Investment Income $34,591.83 $27,978.67 $6,613.16 $71,525.03 $55,957.34 $15,567.69 Sewer Lease/City of Littleton 7,500.00 7,500.00 Office Rent Income 600.00 600.00 1,200.00 1,200.00 Plan Review and Inspections 5,554.60 3,333.33 2,221.27 9,209.81 6,666.66 2,543.15 W&S Tap Administration Fees 25.00 25.00 25.00 25.00 Tap Fees - Water 132,500.00 56,000.00 76,500.00 132,500.00 84,000.00 48,500.00 Tap Fees - Sewer 47,025.00 5,500.00 41,525.00 49,202.00 16,500.00 32,702.00 Other Income 1,154.79 375.00 779.79 4,504.79 750.00 3,754.79 TOTAL REVENUE $221,451.22 $93,787.00 $127,664.22 $275,666.63 $172,574.00 $103,092.63 OPERATING EXPENDITURES GENERAL OFFICE Office Administration $40,328.12 $42,000.00 $1,671.88 $40,328.12 $42,000.00 $1,671.88 Dues & Seminars 166.67 166.67 1,237.50 333.34 (904.16) Office Supplies 125.00 125.00 563.70 250.00 (313.70) Public Relations 3,125.00 3,125.00 6,250.00 6,250.00 Legal Notices - Ads 16.67 16.67 33.34 33.34 Bank Charges 147.03 (147.03) 253.62 (253.62) Miscellaneous 129.17 129.17 258.34 258.34 PROFESSIONAL & CONSULTING Legal Services 3,508.50 2,916.67 (591.83) 3,508.50 5,833.34 2,324.84 Legal Fees - Backcharges 2,840.00 416.67 (2,423.33) 2,840.00 833.34 (2,006.66) Technical Advisory Committee 7,500.00 15,000.00 7,500.00 Engineering - Backcharges 500.00 500.00 1,000.00 1,000.00 Engineering Water 234.84 416.67 181.83 234.84 833.34 598.50 Engineering Sewer 78.28 416.67 338.39 78.28 833.34 755.06 Engineering - GIS 2,560.44 5,000.00 2,439.56 2,560.44 5,000.00 2,439.56 INSURANCE 1,381.33 1,187.50 (193.83) 2,762.66 2,375.00 (387.66) DIRECTORS FEES 500.00 500.00 1,000.00 1,000.00 SOCIAL SECURITY/MEDICARE 38.25 40.00 1.75 76.50 80.00 3.50 REPAIR & MAINT - OFFICE BLDG 966.48 2,500.00 1,533.52 4,499.28 5,000.00 500.72 UTILITIES & TELEPHONE 1,483.28 2,666.67 1,183.39 5,349.36 5,333.34 (16.02) WATER OPERATING EXPENDITURES Repairs & Maintenance 13,523.64 27,000.00 13,476.36 18,654.52 32,000.00 13,345.48 R&M - Hogback Pump Station 1,000.00 1,000.00 1,445.55 2,000.00 554.45 Utilities - Hogback Pump Station 2,264.82 2,291.67 26.85 5,370.22 4,583.34 (786.88) Telemetry - Hogback Pump Station 250.26 154.17 (96.09) 345.42 308.34 (37.08) R&M Contract - Emergencies 11,037.63 8,333.33 (2,704.30) 11,037.63 16,666.66 5,629.03 R&M Contract - Remedial 1,737.00 6,750.00 5,013.00 1,737.00 13,500.00 11,763.00 SEWER OPERATING EXPENDITURES Repairs & Maintenance 36,038.67 30,000.00 (6,038.67) 36,038.67 30,000.00 (6,038.67) R&M Flow Meters 416.67 416.67 833.34 833.34 Utilities - Flow Meters 130.22 145.83 15.61 283.77 291.66 7.89 Telemetry - Flow Meters 483.37 500.00 16.63 483.37 1,000.00 516.63 R&M Contract - Emergencies 1,666.67 1,666.67 3,333.34 3,333.34 R&M Contract - Remedial 4,166.67 4,166.67 8,333.34 8,333.34 UTILITY NOTIFICATION 500.25 775.00 274.75 926.55 1,550.00 623.45 TOTAL OPERATING EXPENDITURES $120,032.41 $145,323.37 $25,290.96 $149,115.50 $206,646.74 $57,531.24
6 Southwest Metropolitan Water & Sanitation District Schedule of Revenue and Expenditures Budget & Actual CM/YTD Actual Compared to CM/YTD Budget For the Two Months Ending February 28, 2017
------CURRENT MONTH------YEAR TO DATE------ACTUAL BUDGET VARIANCE ACTUAL BUDGET VARIANCE Favor(Unfavor)
CAPITAL OUTLAY WATER PROJECTS:
SEWER PROJECTS: Dutch Creek Rehabilitation $19,507.19 ($19,507.19) $19,507.19 ($19,507.19) OFFICE BUILDING IMPROVEMENTS 84,393.65 (84,393.65) 84,393.65 (84,393.65) CONTINGENCY/EMERGENCIES 10,602.33 10,602.33 21,204.66 21,204.66 TOTAL CAPITAL OUTLAY $103,900.84 $10,602.33 ($93,298.51) $103,900.84 $21,204.66 ($82,696.18) TOTAL EXPENDITURES $223,933.25 $155,925.70 ($68,007.55) $253,016.34 $227,851.40 ($25,164.94) REVENUE OVER (UNDER) EXPENDITURES ($2,482.03) ($62,138.70) $59,656.67 $22,650.29 ($55,277.40) $77,927.69 BEGINNING FUNDS AVAILABLE $24,892,856.64 $24,892,856.64 ENDING FUNDS AVAILABLE $24,915,506.93 $24,837,579.24
7 Southwest Metropolitan Water & Sanitation District Cumulative Revenues and Operating Expenditures Compared to Budget and YTD Capital Outlay January 2017 to December 2017 $2,200 Actual $2,000 Revenue
$1,800 Budget Revenue $1,600 Actual $1,400 Operating Expenses $1,200 Budget Operating Dollars $1,000
Thousands Expenses $800 Capital $600 Outlay
$400
$200
$0 Jan Mar May Jul Sep Nov Feb Apr Jun Aug Oct Dec Pl atte Canyon Water & Sani tati on Di stri ct Schedul e of I nvestment Bal ances Investments Held by Type As of February 29, 2017
I nvestment Type Amount Per centage
Cash - Checking $225,068.00 2.20%
Certi f i cates of Deposi t $994,000.00 9.70%
Colotrust - Prime 0.00 0.00%
Colotrust - Plus 2,575,314.51 25.14%
ColoTrust - Trust Account 463,793.38 4.53%
Treasury Bills 0.00 0.00%
Treasury Notes 999,593.78 9.76%
U.S. Government Instrumentalities 4,987,149.21 48.68%
Total s $10,244,918.88 100.00%
DISTRIBUTION BY INVESTMENT TYPE: Checking 2% Certificates of Deposit 10% ColoTrust 29%
U.S. Government Instrumentalities 49% Treasury Notes 10% Platte Canyon Water & Sanitation District Schedule of I nvestment Balances February 28, 2017
**T-Bills Activity**
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD AMOUNT 01/31/17 M PURCHA SES MATURITIES 02/28/17
$ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
* * T r easur y Note Activity* *
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD AMOUNT 01/31/17 M PURCHA SES MATURITIES 02/28/17 06/09/14 06/30/17 0.870% $ 1,000,000.00 $ 999,499.77 $ 94.00 $ - $ 999,593.78
$ 1,000,000.00 $ 999,499.77 $ 94.00 $ - $ 999,593.78
* * Agency Activity* *
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD AMOUNT 01/31/17 M PURCHA SES MATURITIES 02/28/17
FHLB 07/01/16 12/28/18 1.083% $ 1,000,000.00 $ 1,003,131.32 $ (126.15) $ - $ 1,003,005.17 FHLMC 07/02/13 06/11/19 1.928% 500,000.00 493,605.48 208.19 0.00 493,813.67 FHLMC 11/27/13 06/11/19 1.800% 1,000,000.00 990,004.95 325.42 0.00 990,330.37 FNMA 08/25/16 08/25/21 1.450% 1,500,000.00 1,500,000.00 0.00 0.00 1,500,000.00 FFCB 07/19/16 01/19/23 1.875% 1,000,000.00 1,000,000.00 0.00 0.00 1,000,000.00
$ 5,000,000.00 $ 4,986,741.75 $ 407.46 $ - $ 4,987,149.21 Platte Canyon Water & Sanitation District Schedule of I nvestment Balances February 28, 2017
* * Cer tificate of Deposit Activity* *
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD PRI NCI PA L 01/31/17 PURCHA SES MATURITIES 02/28/17
Fowl er State Bank 04/03/16 04/03/17 0.8500% 100,000.00 100,000.00 0.00 0.00 100,000.00 Sol era Nati onal Bank 04/19/14 04/19/17 0.9000% 249,000.00 249,000.00 0.00 0.00 249,000.00 Fowl er State Bank 06/11/16 06/11/17 0.8500% 150,000.00 150,000.00 0.00 0.00 150,000.00 CO State Bank & Trust 01/20/16 06/20/17 0.6000% 250,000.00 250,000.00 0.00 0.00 250,000.00 Bank of Denver 10/04/16 10/04/17 0.7500% 100,000.00 100,000.00 0.00 0.00 100,000.00 Flatirons Bank 09/22/16 10/06/18 0.7500% 145,000.00 145,000.00 0.00 0.00 145,000.00
$ 994,000.00 $ 994,000.00 $ - $ - $ 994,000.00 Platte Canyon Water & Sanitation District Schedule of I nvestment Balances February 28, 2017
**ColoTrust PRIME**
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD 01/31/17 PURCHA SES REDEMPTIONS 02/28/17
ColoTrust Prime 01/31/17 02/28/17 0.0500% $ - $ - $ - $ -
$ - $ - $ - $ -
**ColoTrust PLUS**
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD 01/31/17 PURCHA SES REDEMPTIONS 02/28/17
ColoTrust Plus 01/31/17 02/28/17 0.9200% $ 2,853,354.30 $ 1,960.21 $ 280,000.00 $ 2,575,314.51
$ 2,853,354.30 $ 1,960.21 $ 280,000.00 $ 2,575,314.51
* * ColoTrust - Trust Account* *
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHA SE MATURITY YIELD 01/31/17 PURCHA SES REDEMPTIONS 02/28/17
ColoTrust Plus - UMB 01/31/17 02/28/17 0.9200% $ 452,600.57 $ 11,192.81 $ - $ 463,793.38
$ 452,600.57 $ 11,192.81 $ - $ 463,793.38 Platte Canyon Water & Sanitation District Schedule of I nvestment Balances Summary by M onth of M aturity at Par Value 2/28/17
M ar-17 $3,039,107.89 Apr-17 349,000.00 M ay-17 0.00 Jun-17 1,400,000.00 Jul-17 0.00 Aug-17 0.00 Sep-17 0.00 Oct-17 100,000.00 Nov-17 0.00 Dec-17 0.00 Jan-18 0.00 Feb-18 0.00 M ar-18 0.00 Apr-18 0.00 M ay-18 0.00 Jun-18 0.00 Jul-18 0.00 Aug-18 0.00 Sep-18 0.00 Oct-18 145,000.00 Nov-18 0.00 Dec-18 1,000,000.00 Jan-19 0.00 Feb-19 0.00 M ar-19 0.00 Apr-19 0.00 M ay-19 0.00 Jun-19 1,500,000.00 Jul-19 0.00 Aug-19 0.00 Sep-19 0.00 Oct-19 0.00 Nov-19 0.00 Dec-19 0.00 Jan-20 0.00 Feb-20 0.00 M ar-20 0.00 Apr-20 0.00 M ay-20 0.00 Jun-20 0.00 Jul-20 0.00 Beyond 2,500,000.00
Total $10,033,107.89
A verage Y i el d 1.2266%
Estimated Income/Month $10,256 Platte Canyon Water & Sanitation District Distribution by Maturity:
$5,000,000.00 $4,500,000.00 $4,000,000.00 $3,500,000.00 $3,000,000.00 $2,500,000.00 $2,000,000.00 $1,500,000.00 $1,000,000.00 $500,000.00 $0.00 2017 2018 2019 2020 2021 2022 2023 Platte Canyon Water & Sanitation District
5.00%
4.50%
4.00%
3.50%
3.00%
2.50% Investment Yield Yield % 2.00%
1.50%
1.00%
0.50%
0.00% Mar Apr May June Jul Aug Sep Oct Nov Dec Jan Feb 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2017 2017 Platte Canyon Water & Sanitation District Five Year Investment Balance Comparison
$10,800,000.00
$10,700,000.00 10,753,183.85
$10,600,000.00 10,638,608.41 10,578,981.67 10,577,598.38 $10,500,000.00
$10,400,000.00 Investment Balance $10,300,000.00
$10,200,000.00 10,244,918.88
$10,100,000.00
$10,000,000.00
$9,900,000.00 Dec 2013 Dec 2014 Dec 2015 Dec 2016 Feb 2017 Southwest Metropolitan Water & Sanitation District Schedul e of I nvestment Bal ances Investments Held by Type As of February 29, 2017
I nvestment Type Amount Per centage
Cash - Checking $941.77 0.00%
Certi f i cates of Deposi t $2,341,537.80 9.44%
Colotrust - Prime 0.00 0.00%
Colotrust - Plus 2,615,560.57 10.55%
ColoTrust - Trust Account 3,772,304.85 15.21%
Treasury Bills 0.00 0.00%
Treasury Notes 6,024,920.74 24.30%
U.S. Government Instrumentalities 10,041,636.93 40.50%
Total s $24,796,902.66 100.00%
DISTRIBUTION BY INVESTMENT TYPE: Certificates of Checking Deposit 0% 9%
ColoTrust U.S. Government 26% Instrumentalities 41%
Treasury Notes 24% Southwest Metropolitan Water & Sanitation District Schedul e of I nvestment Bal ances
**T-Bills Activity for Month** February 2017
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD AMOUNT 01/31/17 PURCHASES MATURITIES 02/28/17
01/01/02 01/02/02 0.000% $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ -
* * Treasury Note A cti vi ty* * February 2017
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD AMOUNT 01/31/17 PURCHASES MATURITIES 02/28/17 04/16/14 10/31/17 1.066% 1,000,000.00 997,700.93 236.67 0.00 997,937.60 04/06/11 02/15/21 3.463% 5,000,000.00 5,027,505.27 (522.13) 0.00 5,026,983.14
$ 6,000,000.00 $ 6,025,206.20 $ (285.47) $ - $ 6,024,920.74
**Agency Activity** February 2017
DATE OF DATE OF FACE BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD AMOUNT 01/31/17 PURCHASES MATURITIES 02/28/17
Federal Farm Credi t Bank 05/02/11 04/06/20 3.530% $ 1,000,000.00 $ 1,047,822.44 $ (1,154.33) $ - $ 1,046,668.10 Federal Home L oan Bank 07/19/16 01/19/21 1.429% 3,000,000.00 2,996,699.09 63.83 0.00 2,996,762.92 Federal Nati onal M ortgage A ssoci ati on 08/25/16 08/25/21 1.450% 2,000,000.00 2,000,000.00 0.00 0.00 2,000,000.00 Federal Home L oan M ortgage Corp 08/25/16 08/25/21 1.621% 2,000,000.00 1,998,175.25 30.67 0.00 1,998,205.91 Federal Farm Credi t Bank 07/19/16 01/19/23 1.875% 2,000,000.00 2,000,000.00 0.00 0.00 2,000,000.00
$ 10,000,000.00 $ 10,042,696.77 ($1,059.84) $0.00 $ 10,041,636.93 Southwest Metropolitan Water & Sanitation District Schedul e of I nvestment Bal ances
**Certificate of Deposit Activity** February 2017
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD PRI NCI PA L 01/31/17 PURCHASES MATURITIES 02/28/17
Fowl er State Bank 06/11/16 06/11/17 0.8500% 150,000.00 150,000.00 0.00 0.00 150,000.00 CO State Bank & Trust 01/20/16 06/20/17 0.6000% 250,000.00 250,000.00 0.00 0.00 250,000.00 Fowl er State Bank 01/17/16 07/17/18 0.9000% 99,000.00 99,000.00 0.00 0.00 99,000.00 CDARS: Amarillo National Bank 08/25/16 08/24/17 0.6000% 243,500.00 243,500.00 0.00 0.00 243,500.00 CDA RS: Capi tal Bank Corporati on 08/25/16 08/24/17 0.6000% 243,500.00 243,500.00 0.00 0.00 243,500.00 CDARS: Customers Bank 08/25/16 08/24/17 0.6000% 243,500.00 243,500.00 0.00 0.00 243,500.00 CDA RS: Fi rst Capi tal Bank of Texas. N.A . 08/25/16 08/24/17 0.6000% 13,847.06 13,847.06 0.00 0.00 13,847.06 CDA RS: L egacy Texas Bank 08/25/16 08/24/17 0.6000% 111,690.74 111,690.74 0.00 0.00 111,690.74 CDA RS: M eri di an Bank 08/25/16 08/24/17 0.6000% 243,500.00 243,500.00 0.00 0.00 243,500.00 Bank of Denver 10/01/16 10/01/17 0.7000% 100,000.00 100,000.00 0.00 0.00 100,000.00 Centenni al Bank 01/05/17 01/05/18 0.8000% 249,000.00 249,000.00 0.00 0.00 249,000.00 Fl atI rons Bank 09/22/16 10/06/18 0.7500% 145,000.00 145,000.00 0.00 0.00 145,000.00 Sol era Bank 02/24/16 02/24/19 1.2400% 249,000.00 249,000.00 0.00 0.00 249,000.00
$ 2,341,537.80 $ 2,341,537.80 $ - $ - $ 2,341,537.80 Southwest Metropolitan Water & Sanitation District Schedul e of I nvestment Bal ances
**ColoTrust PRIME** February 2017
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD 01/31/17 PURCHASES REDEMPTIONS 02/28/17
ColoTrust Prime 01/31/17 02/28/17 0.0500% $ - $ - $ - $ -
$ - $ - $ - $ -
**ColoTrust PLUS** February 2017
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD 01/31/17 PURCHASES REDEMPTIONS 02/28/17
ColoTrust Plus 01/31/17 02/28/17 0.9200% $ 2,562,723.06 $ 151,837.51 $ 99,000.00 $ 2,615,560.57
$ 2,562,723.06 $ 151,837.51 $ 99,000.00 $ 2,615,560.57
* * ColoTrust - Trust Account* * February 2017
DATE OF DATE OF BALANCE AT ADDITIONS/ BALANCE AT PURCHASE MATURITY YIELD 01/31/17 PURCHASES REDEMPTIONS 02/28/17
Col oTrust Pl us UM B 01/31/17 02/28/17 0.9200% $ 3,739,180.63 $ 33,124.22 $ - $ 3,772,304.85
$ 3,739,180.63 $ 33,124.22 $ - $ 3,772,304.85 Southwest Metropolitan Water & Sanitation District Schedule of I nvestment Balances Summary by M onth of M aturity at Par Value 2/28/2017
M ar-17 $6,387,865.42 Apr-17 0.00 M ay-17 0.00 Jun-17 400,000.00 Jul-17 0.00 Aug-17 1,099,537.80 Sep-17 0.00 Oct-17 1,100,000.00 Nov-17 0.00 Dec-17 0.00 Jan-18 0.00 Feb-18 0.00 M ar-18 0.00 Apr-18 0.00 M ay-18 0.00 Jun-18 0.00 Jul-18 99,000.00 Aug-18 0.00 Sep-18 0.00 Oct-18 145,000.00 Nov-18 0.00 Dec-18 0.00 Jan-19 0.00 Feb-19 249,000.00 M ar-19 0.00 Apr-19 0.00 M ay-19 0.00 Jun-19 0.00 Jul-19 0.00 Aug-19 0.00 Sep-19 0.00 Oct-19 0.00 Nov-19 0.00 Dec-19 0.00 Jan-20 0.00 Feb-20 0.00 M ar-20 0.00 Apr-20 1,000,000.00 M ay-20 0.00 Jun-20 0.00 Jul-20 0.00 Beyond 14,000,000.00
Total $24,480,403.22
A verage Y i el d 1.7863%
Estimated Income/Month $36,441 Southwest Metro Water & Sanitation District Distribution by Maturity:
$10,000,000.00
$9,000,000.00
$8,000,000.00
$7,000,000.00
$6,000,000.00
$5,000,000.00
$4,000,000.00
$3,000,000.00
$2,000,000.00
$1,000,000.00
$0.00 2017 2018 2019 2020 2021 2022 2023 Southwest Metropolitan Water & Sanitation District Investment Yield
5.00% 4.50% 4.00% 3.50% 3.00%
2.50% Investment Yield Yield % 2.00% 1.50% 1.00% 0.50% 0.00%
Month Southwest Metro Water & Sanitation District Five Year Investment Balance Comparison
$35,000,000.00
$30,000,000.00 31,935,908.37 $24,796,902.66 29,231,919.59 $25,000,000.00 25,961,316.19 24,857,148.48
$20,000,000.00
Investment Balance
$15,000,000.00
$10,000,000.00
$5,000,000.00
$0.00 Dec 2013 Dec 2014 Dec 2015 Dec 2016 Feb 2017
Manager’s Information Report Platte Canyon Water and Sanitation District Southwest Metropolitan Water and Sanitation District March 2017
Personnel Matters (PC and SWM)
Cynthia Lane has accepted an offer of employment for the assistant manager position and will begin work on April 10.
Employee Training and Certifications
Operations staff members attended a two day training session hosted by Alameda Water and Sanitation District. The training enabled staff members to obtain continuing education credits required to maintain their Colorado water and wastewater certifications.
Operations staff also attended a pressure reducing valve training session organized by Scott Hand and Denver Water which was held at the District office.
Operations staff attended a presentation by engineers at Kleinfelder pertaining to pipe corrosion: its cause, remedies to current problems and preventive measures.
Tony Cocozzella and Scott Hand were invited to participate in a Denver Water “Water Quality Value Stream Assessment” conducted to consider opportunities for enhancing efficiencies in water quality standard processes and procedures. Recommendations made by participants will be scheduled for week long lean sessions later this year or in 2018.
Scott Hand, Tony Cocozzella and Armando Quintana attended a Water Utility and Emergency Service Coordination Workshop hosted by the U.S EPA.
Long Term Financial Plans (PC and SWM)
The Long Term Financial Plans for Platte Canyon and Southwest Metropolitan will be updated in 2017. The plans extend the period of analysis from the 10 year period included in the annual budgets for an additional 20 years to capture long term infrastructure rehabilitation and replacement needs. The plan supplies the information needed to schedule capital replacements and improvements, revenue requirements and also presents options for revenue sources needed to meet revenue requirements.
1
District Policies and Procedures
District staff have embarked on a review and updating of Platte Canyon and Southwest Metropolitan policies and procedures. Any proposed policy changes will be submitted to the Boards for approval. We will use a standard format for all of the procedures which will be divided into financial, operation and maintenance, plan review and construction, and general administrative categories. New procedures will be developed as we see a need. While staff has periodically updated procedures as needed, the current effort is a more comprehensive review and will promote more efficient and effective transition during future workforce changes.
May 2016: This effort is continuing as District staff prepares and updates 78 financial; administrative; plan review and construction; and operations and maintenance procedures. The procedures will greatly aid our efforts to cross train employees and have at least one employee capable of filling in for and carrying out the duties of those employees who have primary responsibility for varies job functions.
August 2016: Significant progress has been made in our effort to update and develop new procedures that will assist cross training and help ensure that staff will be capable of conducting all District functions in an efficient manner even in the absence of the employee with primary responsibility for a specific function.
March 2017: This effort has been slowed by the resignation of the assistant manager last year and the resulting increase in workload for other administrative employees. Hiring of a replacement for the assistant manager will help to revive our efforts to complete this project.
Customer Outreach, Newsletters and Websites (PC & SWM)
The first newsletter for 2017 has been mailed.
District staff is introducing video’s into weekly website articles. We intend to use more video media in the future to bring topical, pertinent information to District customers. Thanks to Adam Morse, Tony Cocozzella and Barrie Brinkley for coordinating this effort.
Geographic Information System (PC & SWM)
In 2011, Platte Canyon and Southwest Metropolitan contracted with Merrick & Company (Merrick) to migrate the Districts’ Spatialnet GIS software to ESRI Map View software. ESRI is the industry leader for GIS software and it is currently used by Denver Water, Littleton-Englewood Wastewater Treatment Plant and numerous other Denver Metro Area entities. Spatialnet worked well for the Districts, but was unable to continue to provide long term, reliable support for its software. Subsequent to completion of the initial migration to ESRI software, additional functionality was added to improve mobile operations and maintenance and administrative support programs. For example, in 2012 work was conducted to map and index the Districts’ easements and map and create data bases for water and sewer tap and service line locations. Fire hydrant
2
branch lines and additional hydraulic features were added in 2013. All surface facilities were surveyed using GPS technology in 2013 and 2014 and Merrick incorporated the acquired data into each Districts’ GIS.
Over the past four years, the GIS has been expanded to include water and sewer service pipe (tap) locations, aerial photo overlay, parcel data acquired from Jefferson, Arapahoe and Douglas Counties, water pressure zone boundaries, sewer basin boundaries, topographic data, and creation of a water main isolation program.
Merrick and Company has been retained to perform the services on an “on call” basis at fixed hourly rates within a not to exceed budget. In addition, for 2016 Merrick has been retained to incorporate a hydraulic analysis of the Districts’ water systems into the GIS. Adam Morse is scanning and linking all District water and sewer tap permits to the GIS so the data is easily accessible to office and field staff.
November 2016: District staff is working with Tim Flynn to prepare an agreement with Merrick & Company to perform on call GIS and mapping services for Platte Canyon and Southwest Metropolitan. It is anticipated that these contracts will provide an option for renewal for two additional one year periods beyond 2017. The contracts will be submitted to the Boards of Directors for approval at the December meeting.
December 2016: The on call agreement for Platte Canyon will be placed on the December meeting agenda for Board consideration.
March 2017: Southwest Metropolitan and Platte Canyon each have numerous intergovernmental agreements with adjacent districts and municipalities to share water and sewer facilities. The agreements typically contain provisions for sharing facility operating, maintenance, repair and replacement costs. In order to help track the cost sharing arrangements, District staff is developing a scope of work to add a layer to each District’s GIS and link each facility to a database containing the pertinent intergovernmental agreement and details on cost sharing provisions. The project will be proposed for funding in the 2018 budgets.
Purchase of Property Located West of the Columbine Pump Station from Denver Water to Platte Canyon (PC)
Denver Water owns vacant land immediately west of the Columbine Pump Station. The property housed a treated water reservoir which was abandoned and demolished several years ago. Denver Water has no immediate plans for the property. In conjunction with the rehabilitation of the Columbine West Pump Station District staff have requested use of a portion of the property for a construction staging area. In discussing the potential use of the property we have decided to expand our request to include acquisition of the property for future materials storage. Purchase of the property would also provide safer and more efficient access to the pump stations site. Tony Cocozzella has initiated conversations with Denver Water property management staff and we will continue to inform the Board of the status of these discussions as they move forward.
3
March 2016: Denver Water has informed us that they will not consider subdividing the Ken Caryl Ave. property because the small parcel Platte Canyon is interested in has a large impact on the value of the entire site. We have asked for an assessment of the valuation of the entire site to determine if it is worth pursuing acquisition.
April 2016: Denver Water has now informed us that the Columbine West property has not been determined to be “surplus property” making it unavailable for sale. They are reviewing any future need for the property and will advise us soon if the property will be available for sale and the appraised value.
May 2016: Denver Water is not ready to release the appraisal report for the Columbine West property, however Tony Cocozzella has been informed that the value of the 7,812 square foot parcel we would like to acquire is $48,600; $7,700 for the property and $40,900 for the reduction in value to the remaining property. The value of the total four acre parcel is $533,200. Acquisition of the property will be placed on the May Board meeting agenda for discussion.
Outside of our discussion with Denver Water on purchasing the property, we are moving forward with acquisition of an easement to use the property for construction staging. The cost of the temporary easement is $2,000, Denver Water’s standard easement and license agreement processing fee.
July 2016: A meeting was held on July 14 with Tim Flynn, Denver Water’s legal representative, Denver Water property management staff, Tony Cocozzella and me. Denver Water expressed conditional interest in expanding the boundaries of the property we wish to acquire although they are not willing to sell the entire site. Tony Cocozzella is going to work with a surveyor to obtain a topo survey of the area surrounding the site we are acquiring to assure Denver Water that they will have adequate access to the entire site if the site being acquired by Platte Canyon is enlarged. In the meantime, Denver Water will issue a temporary easement so the initial site can be used for construction staging. Tim Flynn will work with Denver Water’s attorney and the Jefferson County attorney to prepare documents to proceed with a friendly condemnation of the property we ultimately agree to purchase.
August 2016: As requested by Denver Water, Tony Cocozzella has obtained a topographic survey of a portion of the Denver Water property to determine if a road with acceptable grade can be constructed to provide access to all of the remaining Denver Water property if a larger parcel is sold to Platte Canyon. The survey will be provided to Denver Water and we will then continue our discussions regarding the size and shape of the parcel to be acquired by the District.
September 2016: Tony Cocozzella has submitted the topographic survey to Denver Water with a conceptual drawing of the property we are requesting to purchase.
Denver Water has issued a letter to the Platte Canyon providing for the use of their property for construction phasing.
October 2016: Tony Cocozzella is continuing to work with Denver Water to satisfy their seemingly insatiable request for information in order to agree to the boundaries of the property to
4
be sold to Platte Canyon. Dewberry Engineering has been retained to prepare a basic design for the shared access drive off of S. Zepher St. into Denver Water’s property and the entrance to the site we hope to acquire.
December 2016: A location and site improvement drawing is being prepared by Dewberry Engineers and will be submitted to Denver Water staff when completed. At that time we will request an expeditious review so we can proceed with acquisition of the property.
January 2017: Tony Cocozzella has made significant progress in the effort to acquire a tract of land adjacent to the Scott J. Morse Pump Station from Denver Water. A meeting was recently held with Denver Water property staff and legal representatives with Mr. Cocozzella and Tim Flynn to establish a framework and schedule for concluding the property sale. The attorneys are now working on a plan to pursue a friendly condemnation of the property.
March 2017: Denver Water staff is reviewing all of the information submitted by Platte Canyon and will prepare a Board of Water Commissioners action item to declare the tract surplus property. At that point, we will work with Denver Water legal staff to purse a friendly condemnation of the property. We have been advised that the review process for declaring the property “surplus” will take approximately two months.
Chatfield Ave. Water Main Relocation in Conjunction with Jefferson County Road Reconstruction (SWM)
Jefferson County has informed us they are in the process of designing a major reconstruction of Chatfield Ave. between Kendall St. and Marshall St. Southwest Metropolitan owns an eight inch water main in Chatfield that may need to be relocated in conjunction of the project. During discussion of this matter at the January board meeting, the Southwest Metropolitan Board directed staff to proceed with negotiations with the County to relocate the water main under the County’s policy to pay 50% of the project’s cost. We have since learned that the County may be proposing relocation of a portion of the water main due to a conflict with a proposed storm sewer pipe. We have notified the County that we expect them to pay 100% of the cost for any water main relocation necessitated by storm sewer construction. Tony Cocozzella is continuing to discuss options and cost sharing arrangements with County representatives.
March 2016: Tony Cocozzella is continuing to have discussions with Brad Bauer relative to replacing the water main in Chatfield Ave. and, if so, how the costs would be shared between the County and Southwest Metropolitan. It now appears that a portion of the water main will need to be relocated due to a conflict with a proposed storm sewer pipe. It is our position that the county should be responsible for the full cost of this portion of the project since it is not necessitated by road work. We will continue to inform the Board on the status of staff’s negotiations as they move forward.
April 2016: We are continuing to negotiate with Jefferson County for an acceptable cost sharing arrangement that would allow us to replace some, or all of the water main in Chatfield Ave. between Kendall and Marshall. A portion of the pipe may have to be replaced due to a conflict
5
with a proposed storm sewer. We believe this is covered by the County policy on utility replacements necessitated by road work. The only question is whether the County should pay 50% or 100% of the cost. If the storm sewer is an integral part of the road rehabilitation, the County would be required to pay 50%, whereas if the storm sewer is a separate project and financed from other than road funds the County should pay 100%.
Unfortunately, the representative from the Road and Bridge Department we have been working with has determined that the County is not obligated to pay for any of the water main relocation costs. We have requested the help of Tim Flynn to talk to the County attorney to help guide the road and bridge employee to a more reasonable and practical solution. Tony Cocozzella will talk more about this during the meeting.
May 2016: The Road and Bridge Department appears to be coming to the conclusion that the County has an obligation to pay 50% of the cost to relocate the water main that is in conflict with a proposed storm sewer. They remain adamant that they have no responsibility to relocate the second water main segment that will not require relocation due to the road o storm sewer project, but may pose a risk due to future leaks. District staff will provide an update and seek Board direction during the May meeting.
June 2016: As discussed during the May Board meeting, District staff have informed Jefferson County that Southwest Metropolitan will pay 50 percent of the cost ($7,500) to design the relocation of the both segments of the District’s water main in Chatfield Ave. between Platte Canyon Rd. and Marshall St. Subsequent to completion of the design, the District will authorize construction of Segment 1 conditioned on the County’s agreement to pay 50 percent of the cost of construction, and will authorize construction of Segment 2 if an acceptable cost sharing agreement can be reached with the County. The County has initiated design of the water main relocation.
July 2016: We are waiting for the County’s consulting engineer to complete the design for the water main relocation before proceeding with an intergovernmental agreement describing how the costs for the water main relocation will be shared between Southwest Metropolitan and the County.
August 2016: Jefferson County’s consulting engineer has completed the design for the relocation of Southwest Metropolitan’s water main, however we have not received a review copy yet. Once we receive the design we will be able to consult with Tim Flynn and the County’s attorney on the preparation of an intergovernmental agreement to specify a cost sharing arrangement as well as construction responsibilities.
September 2016: Tony Cocozzella is coordinating the review of the water main relocation with Kennedy/Jenks Consultants. He has requested, but has not yet received, a proposal for sharing the cost of the water main relocation.
October 2016: Tony Cocozzella has received a cost sharing proposal from Jefferson County and has some questions that he is attempting to resolve before we indicate our acceptance of the proposal. Mr. Cocozzella will be able to offer more information during the October meeting.
6
November 2016: The cost sharing proposal received from Jefferson County is in line with the proposal we made back in March. Mr. Cocozzella has conveyed his acceptance to Jefferson County road and bridge staff and they will now work with the County to prepare an intergovernmental agreement for Southwest Metropolitan’s consideration.
December 2016: A draft intergovernmental agreement prepared by Jefferson County has been submitted to Tim Flynn for review. It is anticipated that the IGA will be presented to the Southwest Metropolitan Board of Directors for approval in January 2017.
January 2017: Tim Flynn has proposed revisions to an intergovernmental cost sharing agreement prepared by Jefferson County. We are awaiting a response to the proposed revisions from the County’s attorney.
February 2017: The proposed Intergovernmental Funding Agreement between Southwest Metropolitan and Jefferson County will be presented to the Board of Directors for approval at the February Board meeting.
March 2017: The Agreement has been fully executed.
Southwest Metropolitan/ Platte Canyon Office Building Remodeling Project (PC and SWM)
Alyssa Quinn is obtaining a proposal for preliminary planning and design for the office remodeling project. The scope of the proposal will include review of current office space use and consideration of future needs, and development of a conceptual plan for remodeling the reception area, offices, restrooms and conference areas, including selection of materials, colors and possible furniture purchases. This first phase of the project will provide the information needed to prepare project specifications for bidding later this year.
March 16: Ashley Dalton is preparing a purchase order for the preliminary phase of the office remodeling project. This phase consists of space planning and selection of materials, colors, furniture and other fixtures as well as providing a project cost estimate. When this work is completed staff will present the conceptual plan to the Boards prior to proceeding with phase II planning and contracting.
April 2016: A purchase order has been issued to Genterro, LLC for phase I of the remodeling project. A schedule for the work and a presentation to the Boards will be developed once we meet with the consultant.
June 2016: District staff met with Jennifer Terry to discuss the scope of work, budget and schedule for the office remodeling project. Ms. Terry will develop a design plan and material selections for a meeting with staff in early to mid-July. A proposal will then be developed for submittal to the Board in July or August.
7
July 2016: District staff is scheduled to meet with Jennifer Terry on July 13 to receive her preliminary design plans. A presentation to the Boards will be made during the July or August meeting.
August 2016: Ashley Dalton and Tim Flynn are working on an agreement with Genterro in accordance with the last months Board meeting discussion.
September 2016: A preconstruction meeting with Jennifer Terry will be conducted as soon as certificates of insurance have been received. We will have a more definitive schedule for the work subsequent to the meeting.
October 2016: District staff conducted a preconstruction meeting with Jennifer Terry to finalize project details and refine the project schedule. Some of the material has been ordered and is scheduled to arrive prior to year-end. Ms. Terry has solicited bids from installation contractors and will be submitting them shortly. Given the lengthy lead times for manufacturing and delivering some of the materials, it is likely the majority of the project will be conducted in late 2016 and early 2017.
November 2016: Alyssa Quinn has been meeting with Jennifer Terry to coordinate selection of materials and installation contractors, and to schedule construction of the various project elements. Work will begin in December.
December 2016: We continue to expect that work will begin this month. A status report will be provided during the upcoming meeting.
January 2017: Following a number of delays to this project, some unavoidable and some very avoidable, we conducted a meeting with our designer/contractor to determine an acceptable process and schedule to move forward with the project. We now feel we are back on track and construction will begin shortly.
February 2017: Genterro, LLC and its subcontractors have made substantial progress over the past month. We now expect the project to be completed by the end of February.
March 2017: the project schedule now calls for substantial completion on March 24. We are requiring that Genterro, LLC obtain lien releases from all subcontractors to ensure that the money we are paying Genterro is flowing through to the subcontractors.
Overlook Plateau Subdivision Annexation (SWM)
District staff recently discovered that the Overlook Plateau Subdivision consisting of 10 single family lots is not within Southwest Metropolitan boundaries, despite the fact that the District has been providing water and sewer services since 2014. The subdivision is located south of Mineral Ave., between S. Overlook Way and the Nevada Ditch. Ashley Dalton, Tim Flynn and I have been working together to develop a plan to annex the property into the District. As a first step, Ashley and I are meeting with the Board of Directors for Overlook Plateau on September 16. We
8
will explain the situation and advise them that annexation will result in no increase in taxes or fees since Southwest does not impose a mill levy and the water service fee is already being assessed to the property owners on their water bills. In addition, Southwest Metropolitan will incur all costs associated with the annexation. If a majority of the property owners agree to annex, we will work with Tim to schedule an election to approve annexation. A majority vote of all property owners will enable the District to annex the entire subdivision property.
October 2016: Tim Flynn is preparing a resolution for the Southwest Metropolitan Board to provide notice of the District’s intention to annex the Overlook property. Following that resolution, a second resolution calling for an election to annex the property will be submitted to the Board for consideration. Upon adoption of the election resolution, District staff will work with Mr. Flynn’s office to conduct the election.
November 2016: The first of two required resolutions will be submitted to the Southwest Metropolitan Board during the November meeting. Consideration of the second resolution and the public hearing will be scheduled for the December meeting.
December 2016: a statutory requirement to provide written notice of the public hearing to all property owners will necessitate that the hearing be continued to the January Board meeting.
January 2017: Notice of a public hearing to consider the proposed inclusion has been mailed to all property owners within the inclusion boundaries. The hearing to consider a resolution to call for the inclusion of the property and to request that the District Court set a date for a vote of the property owners will be conducted during the January 27 Board of Directors meeting.
February 2017: Tim Flynn has filed an order with the District Court to set the date for the inclusion election. The mail ballot election will be scheduled for May 2, 2017.
March 2017: The mail ballot election date is set for May 2, 2017. A copy of the mail ballot plan is attached hereto as Attachment 1.
Vistas at Stony Creek Clubhouse Sewer Main Extension (SWM)
Southwest Metropolitan has become embroiled in a dispute between two homeowner associations over extension of a sewer main to provide sewer service to a proposed clubhouse. Vistas at Stony Creek (Vistas) intends to construct a clubhouse on their property which is adjacent to Advantage at Stony Creek (Advantage) property. The least expensive and best alternative to provide sewer service to the proposed facility calls for installation of a sewer service pipe from the clubhouse to an existing Southwest Metropolitan sewer main located in an easement on Advantage property. This would require Vistas to obtain an easement from Advantage, and Advantage has refused to grant the easement. Since the sewer main is located within an easement granted to Southwest, the main could be extended within the easement into Vistas property. The main would be owned and operated by Southwest once installed. Once the sewer main is extended into Advantage property, Advantage could then purchase a sewer tap permit and connect to the sewer main.
9
Advantage has submitted plans for extending the sewer main, just as any developer is allowed to do. As a courtesy, the plan was referred to Vistas for comment. They responded with a letter from their attorney claiming that the District does not have the right to install or allow others to install a new sewer main in the easement. We have referred the letter to Tim Flynn for a determination of the District’s rights. After Tim’s review, if we allow Vistas to proceed we intend to require them to execute an agreement in which they would hold the District harmless from any claims for damages and indemnify the District against any legal action that might result from the sewer main installation.
October 2016: The District has responded to the letter received from the attorney for Advantage at Stony Creek Homeowners Association by clarifying and reiterating the District’s rights granted in the sewer easement recorded several years ago. The response also emphasized the fact that the proposed construction of a new sewer main could be avoided if the Advantage would grant a narrow easement to the Vistas to make a single connection to the existing sewer main. Tim Flynn is now preparing an Application and Agreement for Sewer Main Extensions to set forth the rights, obligations, and responsibilities of the Vistas and the District for construction of the sewer main. Pending execution of the agreement, and approval of the sewer main design plans, construction will be allowed to proceed.
December 2016: Tim Flynn is completing the Applications and Agreements for Sewer Main Extensions and Tony Cocozzella is preparing a letter to alert residents of the Advantage HOA of the impending sewer project. Sewer main construction plans have been approved and construction will be allowed to begin once the Applications and Agreements are executed.
January 2017: A notice of the impending sewer construction project has been sent to all property owners in the Advantage at Stony Creek Homeowners Association. There appears to be no interest from either the Advantage or the Vistas communities in resolving their disagreements and allowing a single sanitary sewer service connection to the sewer main located in the Advantage at Stony Creek development. Given the lack of an agreement, the Vistas at Stony Creek Homeowners Association is proceeding with their plan to extend Southwest Metropolitan’s sewer main to their property boundary to provide for a sewer connection at that point.
February 2017: We have received no response from residents of Vistas to the construction notice. Once the Applications and Agreements for Sewer Main Construction and the Sewer Easement Deed is returned to the District from the owner, Tony Cocozzella will proceed with scheduling a preconstruction meeting.
March 2017: The sewer easement has been executed and recorded and the Applications and Agreements for Sewer Main Extension have been signed and returned. The sewer plans are approved and we are waiting for the contractor to request a preconstruction meeting.
10
Denver Water Distributors’ Rates and Fees Technical Advisory Committee (TAC) (PC & SWM)
In mid-2003, Platte Canyon entered into an intergovernmental agreement with Southwest Metropolitan Water and Sanitation District, Southeast Englewood Water District, Lakehurst Water and Sanitation District, and Bancroft-Clover Water and Sanitation District to form the Denver Water Distributors Rates and Fees Technical Advisory Committee (TAC) to review and monitor Denver Water cost of service rate studies and other issues that impact water rates assessed by Denver Water to distributors. Between 2004 and 2012, fifteen additional members have joined the TAC, bringing total membership to 19 entities serving over 75,000 individual customers.
TAC has executed consulting agreements with MWH Global, Inc (MWH) and Geitner Environment, Inc. (Geitner). Jason Mumm (MWH) is the chief financial consultant, Kees Corssmit (Geitner) provides expert advice and guidance and Fernando Aranda (MWH) performs expert analysis of Denver Water rate and fee structures, studies and reports for professional financial and rate analysis services.
A budget and membership dues schedule are approved by TAC members each year. Dues have dropped from an initial assessment of $1.57 per customer account to $1.08 assessed for 2013. The TAC budget has ranged from $80,000 to $110,000 per year.
TAC’s primary work effort each year includes the analysis of Denver Water’s comprehensive, annual cost of service study that establishes water rates for all Denver Water customers, including the various distributor customer classes. Over time, additional studies have been conducted including an analysis of Denver Water’s outside combined service area rate structure, system development charge assessments, the Water Infrastructure and Supply Efficiency (WISE) financial model and Denver Water’s capital cost allocation process. Some of these supplemental studies resulted in modifications to Denver Water’s rate model with significant reductions in distributor customer rates.
In October 2011, TAC members approved a supplement scope of work under Red Oak’s consulting agreement to authorize Red Oak to provide technical assistance, analysis and modeling in conjunction with negotiations with Denver Water on an alternative rate model. Members also agreed to schedule a special meeting with attorney’s for distributor entities to discuss the rate provisions of distributor contracts as they relate to Denver Water’s decision to adopt an across the board rate increase. Members further agreed to schedule a meeting with representatives of Brownstein Hyatt Farber Schreck (Brownstein) to discuss possible representation on Denver Water rate related matters. It was determined by TAC members after meeting with representatives from Brownstein to not retain legal services, but to continue to work with and negotiate with Denver Water on development of a new rate model.
The rate model negotiations culminated in 2012 when the Denver Board of Water Commissioners adopted a new rate model. TAC did not oppose adoption of the model, but expressed concern about some of the model’s provisions and requested that the group have the opportunity to work with Denver Water staff to address those concerns. A copy of a white paper outlining the concerns is available upon request. TAC is continuing to work with Denver Water staff to fully express its
11
reservations about certain components of the rate model and propose revisions to be incorporated in future annual cost of service rate studies.
Following the September 28, 2012 meeting of the Rates and Fees TAC, a letter was sent to Jim Lochhead supporting the 2013 rate proposal but also expressing a need to clarify certain components of the rate model and a request to convene a meeting with senior Denver Water staff to explain our concerns with calculations used to determine the rate of return, cost of debt and cost of equity. TAC membership decided that these concerns, while being significant, did not rise to a level that would prompt opposition to adoption of the rate proposal. I reiterated points made in the letter to the Board of Water Commissioners during their September 26, 2012 meeting.
In June 2013, Todd Cristiano reported that Denver Water would soon launch a study of rate structure alternatives. The primary concern prompting the study is the extreme variability in rate revenue resulting from Denver Water’s heavy reliance on consumption charges rather than fixed service charges. Such a structure causes revenue to increase in hot dry periods and fall off significantly during wet periods and periods when watering restrictions are implemented. Mr. Cristiano assured TAC members that they will be consulted and involved in the rate structure review.
In September 2013, Fernando Aranda and Jason Mumm met with Todd Cristiano to review the 2014 Denver Water Cost of Service Study. Mr. Aranda reported at a meeting with all TAC members that his preliminary analysis of the study identified neither abnormalities nor adjustments that benefit one class over any other class. The rate of return and “additional amount” appear to be reasonable and consistent with industry norms as well as Denver Water commitments. As a result of his analysis, Mr. Aranda recommended that TAC support Denver Water’s rate proposal for 2014. Following review of Mr. Aranda’s recommendation, the Rates and Fees TAC sent a letter to the Board of Water Commissioners endorsing the 2014 rate proposal. The letter pointed out that the rate of return exceeds the level that TAC finds acceptable, but the group agreed to continue to work with Denver Water staff to bring future rate increases to a more acceptable level.
In March 2014, in my capacity as chairman of the TAC, I received a letter from Grant Water and Sanitation requesting that TAC members pursue legislation in 2015 to essentially restrict Denver Water’s rate setting authority and limit the rate of return that can be charged to outside users. While the proposal is laudable, in my opinion it has no chance of success and will likely destroy future cooperation with Denver Water staff. The majority of TAC members realize that Denver Water is probably exceeding a reasonable rate of return, but believe the excess does not rise to a level that would generate support for a legislative and/or legal challenge. In previous discussions, members have agreed to rely on our consultants to continue to monitor Denver Water rate practices, including documentation of the actual rate or return so a rational decision can be made as to when such a challenge is warranted. A discussion of the Grant District proposal will be planned for the April TAC meeting.
An open and frank discussion regarding Grant Water and Sanitation District concerns was conducted during the April 2014 TAC membership meeting. At the conclusion of the discussion, Grant representatives agreed that pursuing legislation to limit Denver Water’s rate of return from suburban users should not be attempted at this time. They also acknowledged that the TAC has
12
probably made a positive difference in Denver Water rate proposals and that there is a benefit to having the TAC analyze Denver Water rates over an extended period of time. Not all of the benefits realized by the TAC can be easily quantified, but members feel strongly that Denver Water is more attentive to distributor concerns when staff’s work is being critically reviewed by expert rate consultants.
In October 2014, Jason Mumm and Fernando Aranda presented the results of the annual review of Denver Water’s Cost of Service Study. They reported that Denver Water’s rate of return on outside-city rate base exceeds the limitation that we asked the Board of Water Commissioners to adopt when the rate methodology was changed a couple of years ago. As a result, TAC members voted to not endorse the proposed rate proposal for 2015. Rather, we have requested a meeting with the Board of Water Commissioners to present our concerns.
The Rates and Fees TAC made a presentation to the Denver Board of Water Commissioners expressing our concerns with the 2015 Cost of Service Study and 2015 rate increase in December 2014. Following the somewhat contentious meeting, Denver Water rate staff submitted a list of questions to clarify some of the issues raised during the session. Jason Mumm and Fernando Aranda are prepared a white paper to explain TAC positions on the issues raised during and after the meeting and submitted the document to Denver Water senior staff and the Board of Water Commissioners.
Also in December 2014, MWH Global withdrew from its consulting agreement with TAC. Following TAC membership review and discussion regarding options for future consulting services, Fernando Aranda, chief technical analyst for MWH, was retained as an employee of Geitner Environmental, Inc. rather than MWH. TAC also retained Eric Rothstein with Galardi Rothstein, Inc. headquartered in Chicago, Illinois as its primary consultant. Kees Corssmit with Geitner Environmental was retained to provide additional consulting services as required.
In early 2015 TAC devoted its attention to participating in Denver Water’s Rate Structure Study. In June 2015 TAC agreed to support the recommendation of the Rate Structure Stakeholder Group which called for raising the monthly service charge from $6.74 to $8.79; reducing the number of blocks in the tiered rate structure from four to three, and lowering the threshold for the first block from 11,000 gallons to the greater of each residential customers average winter consumption or 5,000 gallons. The impacts of the proposed rate structure included 1) an increase in the fixed portion of revenue which is derived from service charges from 7% to 10% of total rate revenue to produce greater stability in revenue, and 2) a reduction in the subsidy from large lot owners and water consumers to smaller lot owners and water consumers.
November 2015: Rates and Fees TAC members authorized submittal of a letter to Denver Water outlining issues with the 2016 cost of service study that have been raised by the group’s professional consultants. The primary issue continues to be the continuing increase in returns on distributor rate base which now equals 12.95%. The dollar amount of the excess profit received from distributors is $25 million, up from $18 million in 2015. Other concerns that we wish to address include the use of variables in the COS study that appear to be biased toward achieving a goal of reaching a certain level of return from distributor service rather than to pursue an unbiased, equitable cost based rate proposal. We have requested an opportunity to present our concerns to
13
the Board of Water Commissioners during their December 16, 2015 meeting. We have also requested an opportunity to work with Denver Water staff to discuss the origin and basis for the above referenced variables, and determine if there is a way to achieve a more equitable, cost based rate structure. A copy of a PowerPoint presentation delivered to TAC members by the group’s consultants is available upon request.
December 2015: TAC has been granted permission to make a brief presentation to the Board of Water Commissioners during their meeting on December 16. The presentation will focus on our primary concerns with the 2016 cost of service (COS) study and not the rate structure alternatives nor the proposed rate increase. The goal of the presentation is to establish a process and a schedule to clarify questions and issues we have with the COS study and determine if there is a way to amicably discuss and resolve our concerns. Eric Rothstein will make the presentation for the TAC.
TAC members adopted a budget and dues assessment of $1.00 per customer account for 2016. The dues assessment is the same as 2015 and will allow the TAC to maintain a reserve of approximately 50% of its annual expenses.
January 2016: Eric Rothstein, Tim Lowe and I made a presentation on TAC concerns about Denver Water’s cost of service allocations to the Board of Water Commissioners on December 16. We asked the Board to commit to a series of meetings between Denver Water rate staff and TAC representatives to further discuss our concerns. The Board agreed to honor our request and the first meeting is scheduled for February 5. A copy of the draft work plan for the meetings with Denver Water staff is available upon request.
February 2016: Eric Rothstein, Fernando Aranda, Tim Lowe and I met with Denver Water staff and their rate consultant Tom Gould on February 5 in the first of four planned meetings to discuss Rates and Fees TAC concerns with Denver Water’s 2016 cost of service study. Patti Wells reiterated Denver Water’s position that the Board of Water Commissioners has extensive latitude and discretion is setting rates and does not even need to conduct cost of service studies, or adhere to cost of service principles. She also made it abundantly clear that the Board will not allow rates to be lower for outside city customers for similar levels of service, i.e. total service customers. She did, however, acknowledge that it is possible to have lower rates for read and bill customers since they receive a lower level of service than inside city customers.
When Denver Water changed the rate methodology in 2013, distributors were promised a credit for payments made under the “split allocation method” used to allocate capital costs. Under that formula distributors paid up to 70% of the costs for capital projects that it is now clear will be used equally, or at a higher percentage, by inside city customers. While Denver Water includes the credit in the cost of service study allocations, the “additional amount” charged to distributor’s ends up assessing the credit back to them. Allocating capital costs in accordance with previous commitments would result in lower rates for all distributor classes. Thus, it is unlikely that distributors will be granted the credit that was promised absent a lawsuit which has a minimal chance of success and very little support from distributors. In recognition of this situation, TAC is concentrating on future capital cost allocations, and ensuring that they are distributed based on current use between inside and outside city customers.
14
March 2016: The second of four planned meetings between TAC consultants and representatives and Denver Water staff took place on March 11. The meeting was largely devoted to discussing various methods for calculating the “additional amount” which Denver Water is required to recover for the sale of water outside city boundaries. Ten alternatives were discussed and narrowed to four for further analysis. A portion of the meeting was also devoted to a discussion of the definition of “additional amount” and whether the Board of Water Commissioners understands that Denver Water can recover an additional amount from suburban customers that receive the same level of service as in-city customers, even though the nominal rates are the same. This is possible due to the capital contributions made by suburban customers over the years. I raised this as an issue because there seems to be a perception that the nominal rate must be higher for outside- city customers in order to meet the requirement for receiving an “additional amount.” All parties agreed that there needs to be a combined effort to educate the Board on this matter.
May 2016: The parties have agreed to use the baseline rate model prepared by Fernando Aranda to evaluate alternatives to calculate the “additional amount” provided for in distributor contracts. The model is being refined by Mr. Aranda and Eric Rothstein for use during the next meeting with Denver Water staff which is scheduled for May 24. During the meeting we will continue to push for a schedule to present our positions and recommendations to the Board of Water Commissioners.
June 2016: The May 24 meeting with Denver Water staff was devoted to narrowing the alternatives to calculate the “additional amount” recovered by Denver Water from distributor customers. For each alternative, meeting participants discussed the industry standard for a reasonable return, and for each alternative it was determined that Denver Water’s current return exceeds what would be considered reasonable using generally accepted industry standards. The group decided to hold one more meeting and focus on the alternative calling for applying a multiplier to the calculated unit cost of service. TAC consultants propose that the multiplier be 10% to 15%. Denver Water’s current return would require a multiplier of 35% to 41% to provide the “additional amount” the agency is currently receiving. It is anticipated that a presentation on the group’s findings and recommendations will be made to the Board of Water Commissioners on July 27.
July 2016: A joint meeting of the Rates and Fees TAC and the Distributor Forum will be held on July 19 to receive information on and discuss the draft proposal for an alternative methodology to calculate the “additional amount” charged to distributors in accordance with Denver City Charter and Distributor Agreements provisions. If found to be acceptable by distributors, the recommendation will be presented to the Board of Water Commissioners on July 27.
As of July 13, the recommendation is still being negotiated with Denver Water staff. Within the range of alternatives being discussed, all options will result in a narrowing of the rate differential between Denver and suburban customers. Additional information on the recommendation will be presented during the July Board meeting.
August 2016: A presentation on the status of our discussions with Denver Water rate staff was made to the Board of Water Commissioners on July 27. The Board agreed to continue discussions with a focus on use of a methodology to calculate the additional amount consisting of adding a percentage multiplier to the actual unit cost of service. The Board also encouraged the TAC to
15 continue to work with Denver Water staff to work on the details of the methodology. Subsequent to the presentation, Denver Water executive staff met with the Board to further discuss policy issues. The Board indicated they are comfortable with the integrated system concept which eliminates allocation of assets to inside and outside users as has been the practice in the past. They also stated that they do not want to see higher rate increases for Denver customers. I informed Denver senior staff that there will very likely be a need for higher increases for Denver customers relative to distributor customers in order to reduce the additional amount to a number we find reasonable, although we have agreed to phase in such increases over a number of years and have also suggested ways the Denver Water can reduce future rate increases by adjusting debt levels and increase in-City system development charges to the true cost of service. Following a lengthy discussion staff seemed to be a bit more flexible on the rate increase issue.
A meeting of the workgroup is being scheduled for the week of August 21. The session will be devoted to reviewing the rate impacts from various levels of multiplier (10%, 15%, 20% and 30%). A TAC membership meeting will then be scheduled to present the status of our negotiations and determine if there is support to move forward.
September 2016: The TAC workgroup presented its proposal to Denver Water senior staff on September 6. The proposal was in line with the comprehensive, collaborative discussions held with Denver Water rate staff over the past seven months. The proposal was summarily rejected by the CEO/manager, attorney and finance director. As stated by the CEO/manager, TAC does not have a compelling argument and the board could not defend our recommendation to the mayor of Denver. I am in the process of scheduling a meeting with TAC members to discuss and determine where we want to go from here.
October 2016: Discussions are continuing between Denver Water and the Rates and Fees TAC. A meeting with Jim Lochhead, Julie Anderson and Angela Bricmont is scheduled for October 20 to discuss a counterproposal to be offered by Denver Water. A TAC meeting to inform the members of the status of the negotiations was held on October 13.
November 2016: Discussions are continuing but we have yet to find a compromise that is acceptable to distributors and Denver Water.
December 2016: The rate proposal based on the 19% multiplier methodology will be presented to the Board of Water Commissioners on December 14. A resolution describing the rate methodology and the agreement to apply the 19% multiplier will also be considered by the Board on the 19th. A copy of the draft resolution is available upon request.
January 2017: The Rates and Fees TAC has adopted a budget for 2017 that calls for a reduction in dues from $1.00 per account to $.60 per account. I am working with Eric Rothstein and Fernando Aranda on the work plan for 2017. The plan will likely propose a continuation of TAC’s annual participation in Denver Water’s Cost of Service Study, and will also propose an expansion of our collaboration into additional financial matters that affect Denver Water distributors.
February 2017: Eric Rothstein has completed a review of Denver Water’s capital financing structure and we have requested a meeting with Denver Water staff to discuss the findings. Mr.
16
Rothstein is generally complimentary of the agency’s capital financing plan; however, he has requested more information and establishment of an ongoing dialog on capital finances and other financial matters that impact distributor rates and fees.
March 2017: A meeting to discuss Mr. Rothstein’s review of Denver Water’s capital financing strategy has been scheduled for April 11. Jim Lochhead and Julie Anderson will attend the meeting in addition to finance staff.
Littleton - Englewood Wastewater Treatment Plant Pretreatment Program
Platte Canyon staff are working with the Tim Flynn to review and comment on a proposed addendum to the District’s Wastewater Connectors’ Agreement with the City of Littleton. The addendum is being required by the U. S. EPA in order to clarify authorities and responsibilities for implementation and enforcement of the Industrial Pretreatment Program.
January 2016: Littleton Englewood treatment plant staff have reported that the addendum to the District’s Wastewater Connectors Agreement will be submitted to the Supervisory Committee for approval during their December meeting. When approved, the agreement will be submitted to each of the Littleton and Englewood connector districts for approval and execution. I have objected to submittal of the agreement to the Supervisory Committee before the final draft version is submitted to the connector districts for review and comment. I have been told that the agreement will be presented to the connector districts prior to approval by the Supervisory Committee, but I have yet to receive the agreement.
February 2016: Ashley Dalton and I attended the January Supervisory Committee meeting and advised the Board that the draft agreement should be resubmitted to the connector districts for review prior to consideration by the Supervisory Committee and the City Councils. The committee agreed and directed staff to consult with connector districts prior to submitting the agreement to them for approval. It is now one month after the meeting, and we have still not heard from plant staff.
April 2016: Littleton-Englewood staff mailed a letter and copy of the draft Addendum to each connector district asking them to sign and return it. No changes have been made to the addendum since the last submittal, despite several proposed revisions being sent to plant staff. I sent a letter on behalf of Platte Canyon, Southwest Metropolitan, Bow Mar, Columbine, and Valley stating that the districts will not sign the addendum until they have an opportunity to discuss proposed revisions with the appropriate parties.
May 2016: David Robbins, attorney for the Littleton Englewood Wastewater Treatment Plant, is going to call each attorney that provided comments or expressed reservations about signing the Pretreatment Addendum.
October 2016: David Robbins, Littleton Englewood Wastewater Treatment Plant attorney, has contacted attorneys for some of the connector districts to receive additional information on their
17
concerns relative to the proposed pretreatment addendum to the connector agreements. He has indicated that he is willing to accept some amendments to the proposed addendum.
Mr. Robbins is also working with the city attorneys for Littleton and Englewood to prepare amendments to city ordinances related to wastewater pretreatment requirements. The proposed amendments are in response to a recent audit of the treatment plant’s pretreatment program conducted by the EPA.
December 2016: We have reached agreement with attorneys from Littleton Englewood Wastewater Treatment Plant and the City of Littleton on a pretreatment addendum to the Districts’ sewer connection agreements. The Addendums will be submitted to the Platte Canyon and Southwest Metropolitan Boards for approval when we receive executable copies.
January 2017: The Addendums approved by Platte Canyon and Southwest Metropolitan Boards of Directors have been delivered to the City of Littleton for approval. The Valley Sanitation District, and Bow Mar and Columbine Water and Sanitation Districts have also approve the Addendums.
The City of Littleton is pursing amendments to its municipal code to incorporate revisions to sanitary sewer pretreatment requirements. I have requested that the connector districts be given an opportunity to review and comment on the proposed revisions prior to scheduling a public hearing.
March 2017: Littleton Englewood Wastewater Treatment Plant staff transmitted a review copy of proposed revisions of both the City of Englewood and City of Littleton municipal codes as they pertain to wastewater treatment rules and regulations. Each Council will hold public hearings on the revisions in the next several weeks.
Annexation of Wild Plum Farm (Tuck Property) (SWM)
An application for annexation of 104.8 acres of land located south of Fairway Lane between Platte Canyon Rd. and the South Platte River (Wild Plum Farm) has been filed with the Southwest Metropolitan by JPB Holdings, LLC. The property is located within the Town of Columbine which is processing a development plan calling for 100 single family detached homes. Sewer service can be provided by Southwest Metropolitan and water service can also be provided by Southwest contingent upon an agreement with Columbine Water and Sanitation District and Denver Water for a connection to a water main owned by Columbine/Denver. The connection is necessary to provide looped water system using both Southwest Metropolitan and Columbine as water sources. District staff is pursuing the water connection agreement prior to submitting the annexation application to the Southwest Metropolitan Board of Directors.
February 2017: The District has received a Petition for Inclusion and will now advertise for a public hearing during the March meeting.
18
I am working with Tim Flynn to prepare an intergovernmental agreement between Southwest Metropolitan and Columbine Water and Sanitation District to allow Southwest to connect to a Columbine water main in Fairway Lane. This connection will be needed to provide looped water service to the Wild Plum property.
March 2017: A public hearing to consider annexation of the Wild Plum Farm property is scheduled for the March 24 Southwest Metropolitan meeting.
Tim Flynn and the attorney for Columbine Water and Sanitation District have exchanged drafts of an agreement to allow Southwest Metropolitan to make a connection to a Columbine owned water main in Fairway Lane adjacent to the Wild Plum Farm property. The connection is needed to provide looped water service to property.
Property Tax Residential Assessment Rate (PC, BM, Columbine, Valley)
The Gallagher Amendment requires that the values of residential property be adjusted to maintain a constant relationship with non-residential property. The most recent economic forecast by the state’ Legislative Council indicates that the constitutionally required adjustment to the residential assessment rate is expected to decrease from 7.96 percent to 6.85 percent of actual value. The change in assessment rate effects each taxing authority differently based on the mix of residential, commercial and other taxable property within each jurisdiction. Vanessa Shipley is consulting with Jefferson, Arapahoe and Denver Counties to determine the approximate impact on Platte Canyon, Bow Mar, Columbine, and Valley tax revenues. Market adjustments in the biennial reassessment of property values will offset some of the loss in tax revenue, but each entity is still likely to experience a decrease.
Grant Water and Sanitation District Sewer Agreements for Clement Park (PC & SWM)
Grant Water and Sanitation District provides water and sewer service to several Foothills Park and Recreation District facilities located in Clement Park. Both Southwest Metropolitan and Platte Canyon have intergovernmental sewer agreements for transmission of wastewater originating from the facilities. Recent remodeling of the facilities has resulted in Grant exceeding the service limitations in the Platte Canyon IGA. Thus, an amendment to the existing agreement is being prepared to expand Grant’s capacity for Clement Park. The amendment will be submitted to the Platte Canyon Board for approval during the March meeting. Southwest Metropolitan’ IGA with Grant provides sufficient capacity and does not need to be amended.
Annual Statistical Reports PC & SWM)
Alyssa Quinn is updating the annual statistical reports for Platte Canyon and Southwest Metropolitan and should have them completed by mid-April.
19
Intergovernmental Services
Bow Mar Water and Sanitation District
No activity to report.
Columbine Water and Sanitation District
Columbine Sewer Construction Standards and Specifications
Columbine does not have its own set of sanitary sewer standards and specifications. When needed, Platte Canyon staff have referenced Platte Canyon standards as being applicable for work done in Columbine. Tony Cocozzella is now preparing standards and specifications for Columbine which will be submitted to the Columbine Board for approval at their next meeting.
April 2016: The standards have been completed and sent to the Board for review and approval.
May 2016: The Columbine Board of Directors will consider adoption of the sewer standards during the next Board meeting scheduled for June 3.
June 2016: During the Board meeting on June 3, the Board requested a brief presentation on the proposed sewer standards. Rich Cassens and Tony Cocozzella will attend the September Board meeting to summarize the standards and respond to questions.
August 2016: the Board will consider adoption of the draft sewer standards during the September 2, 2016 meeting.
September 2016: The September Board of Directors meeting was cancelled so the sewer specifications will not be considered until the next regular meeting on December 2.
December 2016: The Board of Directors tabled adoption of the sewer standards during the December 2, 2016 meeting and will now take it up during the next meeting in March 2017.
March 2017: The Columbine Board approved the sewer standards and specifications during its meeting held on March 3, 2017.
Willowcroft Subdivision Sewer Deficiencies
During a final acceptance inspection of sewer mains installed in the Willowcroft Subdivision at Bowles Ave. and Middlefield Rd., District staff discovered a number of deficiencies. Scott Hand and Tony Cocozzella have devoted a great deal of time televising and performing inclination
20
assessments of the sewer system to document the problems. During a recent meeting with the builder, Taylor-Morrison, and the sewer contractor, the contractor refused to perform any corrections to the system stating that he believes it remains within reasonable tolerances and still functions. Another meeting with the developer/builder, the contractor and Columbine’s attorney is being scheduled at which time we intend to inform them that 650 feet of the pipe must be excavated and replaced. Should they again reuse to perform repairs, we will recommend that the Board take legal action.
May 2016: The Columbine Board of Directors held a special meeting to discuss and develop a position on how to correct the deficiencies to the Willowcroft sewer system. Tony Cocozzella and I attended the meeting and recommended that the developer be required to replace 650 feet of sewer pipe and provide an extended warranty on the remainder of system to allow us to evaluate its condition over time to determine if additional segments need to be replaced. The Board accepted the recommendation and a meeting between the developer (Taylor Morrison), the developer’s attorney, the District’s attorney and Tony and I has been scheduled for June 2 to present the District’s requirements.
June 2016: Negotiations are continuing with Taylor Morrison over correction of deficiencies to the Willowcroft sewer system. It is likely that the amount of pipe to be replaced will far exceed 650 feet in order to avoid future monitoring of marginally functioning pipe that may ultimately require replacement.
July 2016: The Columbine Board at a special meeting scheduled for July 21 will consider a sewer repair and replacement proposal received from Taylor Morrison. The proposal consists of spot repairs that are not as comprehensive as the recommendation made by Platte Canyon staff.
August 2016: Unfortunately, the District and Taylor Morrison have not reached an agreement on the scope of repairs necessary for the District to accept the Willowcroft sewer system. Discussions are now occurring between the District’s attorney and Taylor Morrison’s attorney. We are providing information and assistance as requested.
October 2016: The attorneys’ for Columbine and Taylor Morrison have been exchanging proposals and agreements for remediation of sewer system deficiencies. A moratorium on the issuance of sewer tap permits will remain in place until the parties reach an agreement.
December 2016: Subject to minor modifications, the Board of Directors approved an agreement with Taylor Morrison for repair of the Willowcroft sewer system. Taylor Morrison will make repairs and the District will observe operation of the system for two years. At the end of the two year period the District will make a final determination whether to accept the system.
January 2017: A sewer repair plan has been submitted to the District by Taylor Morrison and accepted by the District. Repairs will begin in mid-January.
February 2017: Repairs to the Willowcroft sewer system are nearly complete. Tony Cocozzella and Scott Hand will inspect the repairs and, if accepted, Columbine will issue additional sewer
21
taps in the development. The developer has agreed to an extended two year warranty for the sewer system.
March 2017: The sewer repairs have been completed with the exception of three specific areas that Platte Canyon staff have determined are not acceptable. The District is issuing tap permits and allowing connections to the sewer mains while the developer proposes a solution to the three problem areas. The District will monitor the system for two additional years to ensure that it functions as intended.
Lochmoor Water and Sanitation District
No activity to report
Valley Sanitation District
Sewer Service Fee and Pipe Condition Assessment
Scott Hand and Scott Morse are conducting an assessment of concrete sewer pipe in the Valley District. Recent sewer video inspections have revealed some deterioration of the concrete pipe that may require rehabilitation within the next few years. While we do not suspect an immediate need to perform system rehabilitation we want to develop a schedule for the Board of Directors to consider. Valley has only a minimal cash reserve and it is likely that some form of revenue enhancement will be necessary to conduct the amount of rehabilitation that we believe will be necessary.
July 2013: Similar to the Columbine Water and Sanitation District, Valley has a considerable amount of 8-inch concrete pipe that is deteriorating due to hydrogen sulfide attack. Valley has over 42,000 feet of such pipe that will likely cost in excess of $1,350,000 to rehabilitate. Unfortunately, Valley has only a small capital reserve and, despite the obvious need to rehabilitate its concrete pipe, would likely find it difficult to obtain approval of a mill levy increase. Platte Canyon staff is reviewing alternative revenue enhancement measures including a possible surcharge to City of Englewood sewer service billings to Valley customers. We are also evaluating the condition of the concrete pipe to prepare a prioritized capital improvement plan.
September 2013: Unfortunately, Valley does not have funds available to rehabilitate its deteriorating concrete sewer pipe. The Board recognizes the importance of moving forward with rehabilitation so it has requested that Platte Canyon assist in researching and implementing one or more forms of revenue enhancement. Platte Canyon staff will research and present alternatives to the Valley Board as time allows.
January 2014: District staff is working with Tim Flynn to prepare a resolution to establish a District owned enterprise that would receive revenue from a surcharge imposed on customers’ sewer bills. The revenue would be used exclusively for capital improvements, including the rehabilitation of concrete pipe owned by the District.
22
February 2014: A resolution to create an enterprise for the purpose of collecting sewer service charge revenue to be used exclusively for capital projects has been submitted to the Valley Board of Directors. A decision on adoption of the resolution will be made at the Board’s February meeting. If adopted, Platte Canyon staff will work with the City of Englewood to impose a surcharge on Valley customers’ sewer bills. The revenue will be used to rehabilitate the District’s concrete sewer pipe.
March 2014: The Valley District Board adopted a resolution establishing a Wastewater Enterprise to allow the District to develop a revenue source for capital projects that is not subject to TABOR limitations. Platte Canyon staff will now work with the City of Englewood to implement a sewer surcharge to be billed on District customer sewer bills processed by Englewood. The surcharge will provide a reliable, consistent source of revenue to fund rehabilitation of the District’s concrete sewer pipe which is beginning to deteriorate due to age and hydrogen sulfide gas attack. District staff will also assist the Valley District Board in conducting a customer outreach program to inform residents of the planned sewer surcharge.
April 2014: I had a preliminary discussion with the Valley Board of Directors relative to imposing a sewer service surcharge on customer sewer bills to generate revenue for sewer rehabilitation projects. Based on this discussion Scott Morse and I will prepare a limited number of billing alternatives to the Board. When a decision is made to proceed with the surcharge we will work with the City of Englewood to bill District residents and remit the revenue to the District. It is unlikely that all of the administrative and contractual matters will be accomplished prior to the 2014 Englewood sewer billing, so we are working to impose the charge in 2015.
May 2014: Platte Canyon staff will propose to the Valley Board of Directors that they proceed with the implementation of a sewer service charge based on a percentage of the amount billed by the City of Englewood for sewer treatment services. The revenue will be used to rehabilitate deteriorating concrete pipe in the District. The total cost for the proposed rehabilitation is $1.3 million. Based on a moderate surcharge of approximately $20 per year per residence, the project will take over 15 years to complete.
June 2014: The Valley Board of Directors has agreed to proceed with all necessary steps to impose a sewer service fee on all District customers. The steps include holding a public hearing to consider a change in fees, charges, and rates as required by state law, and entering into an intergovernmental agreement with the City of Englewood to process the service charge on Valley customer sewer bills. The funds generated by the service charge will be retained by the Valley Sewer Enterprise and used for capital projects including rehabilitation of aging concrete pipe.
July 2014: The Valley Board of Directors has scheduled a public hearing to consider imposition of a sewer surcharge on City of Englewood sewer bills during the Board’s August meeting. At that time, the Board will consider adoption of a surcharge of 10% of the amount charged by Englewood which will be approximately $20 per year for the average residential customer. The funds will be used to rehabilitate aging concrete pipe which is showing signs of corrosion and deteriorating structural integrity.
23
August 2014: During its meeting on August 13 the Valley Board of Directors approved imposition of a sewer service surcharge on City of Englewood sewer bills at the rate of 10% of the amount of Englewood’s sewer bill. The Valley sewer fee will be approximately $22.00 per residential customer, but will fluctuate because Englewood’s sewer charge is based on water consumption during winter months. The service fee will be imposed on Valley customer sewer bills beginning in 2015. It is expected to generate approximately $60,000 per year and will be used to rehabilitate 42,000 feet of concrete sewer pipe.
September 2014: Scott Morse is working with the City of Englewood to implement the Valley surcharge. Some of Valley’s customers are billed annually by Englewood while other customers who receive water service from Englewood are billed on a bimonthly basis. As a result, the programing and all administrative issues must be completed prior to year-end 2014 to impose the surcharge in 2015.
November 2014: the City of Englewood is on schedule to implement the Valley service fee by January 1, 2015. Barrie Brinkley is producing a newsletter for Valley to explain the recently adopted service fee to District customers.
February 2015: The surcharge is being assessed by Englewood on sewer bills which are combined with City of Englewood water bills for those Valley customers that receive water service from the City. Valley customers who receive water service from Denver Water receive an annual sewer bill in the fall which will include the Valley surcharge.
March 2015: Platte Canyon staff are looking into the possibility of applying for a revolving fund loan from the Colorado Water Resources and Power Development Authority to conduct the rehabilitation of all of Valley’s concrete sewer pipe within the next two years rather than phase the rehabilitation over several years as currently proposed. A decision whether to pursue a loan will be made by the Board within the next few months.
December 2015: Vanessa Shipley was recently advised that there is no revenue from the surcharge to be emitted to Valley. All revenue received by Englewood from Valley customers is first applied to the total amount owed to the City. When the obligation to the City is fulfilled, the excess or surcharge revenue is remitted to the District. While deferred customer payments delay the receipt of revenue by the City, the City ultimately collects all revenue billed by submittal of unpaid amounts to the county assessor for collection as a property tax assessment. So, Valley will ultimately receive all of the surcharge revenue billed by the City.
February 2016: Following further discussions between Vanessa Shipley and City of Englewood staff, the city has agreed to submit partial payment of surcharge revenue to Valley. The city is undergoing some staff changes and when completed Ms. Shipley and I will seek changes in the way surcharge revenue is processed and distributed to the District.
April 2016: Ashley Dalton is preparing an application to put Valley on the Colorado Clean Water Revolving Fund list for a loan to rehabilitate 42,000 feet of 8-inch concrete pipe that is deteriorating due to age and hydrogen sulfide attack. The District will have to seek voter approval
24 for the loan and establishment of a mill levy to retire the debt. Mr. Dalton will work with Tim Flynn to prepare for a TABOR election as early as November 2016.
May 2016: Mr. Dalton is continuing to pursue various financing options, many of which will require a TABOR election in the fall or spring of 2017. The Board has asked Platte Canyon staff to pursue addition customer outreach to advise customers about the condition of the District’s sewer system and the need for rehabilitation in the immediate future.
July 2016: Littleton Englewood Wastewater Treatment Plant staff reported a very high concentration of hydrocarbons entering the plant over the July 4 weekend. The problem was traced back to a Valley Sanitation District sewer manhole near the abandoned landfill south of Oxford Ave. and west of the South Platte River which is known to be leaching methane into the sewer main and/or manholes. The hydrocarbon levels spiked for about four hours at a concentration much higher than what has been observed in the past, leading us to believe the problem may have been caused by illegal dumping into Valley’s sewer system. District staff have discussed the situation with treatment plant staff and have agreed to jointly monitor the situation. If another spike is observed we will increase monitoring efforts.
In the meantime, Ashley Dalton is continuing to pursue a Clean Water Revolving Fund loan to relocate the portion of the sewer main located within the abandoned landfill. Valley’s Board of Directors has authorized us to assist with preparation for a TABOR election to incur debt and repay the debt with a dedicated mill levy increase.
August 2016: The Valley Board of Directors was pursuing a TABOR election to 1) incur debt and secure repayment with a property tax mill levy and 2) de-bruce the District’s revenue (retain and spend initiative). Given the lengthy and complicated ballot for this November’s election, the Board decided to postpone the election until November 2017. This may delay the District’s ability to receive loan funds from the state, but it provides more time to educate the voters on the need for the loan and additional revenue to repair portions of the District’s sewer system.
November 2016: Vanessa Shipley has requested a number of reporting and billing improvements from the City of Englewood to improve the amount and timeliness of information to the District. Progress has been slow due to staff changes and Englewood’s antiquated billing and reporting process.
Customer Outreach
The Valley Board of Directors has asked Platte Canyon staff to prepare a newsletter to explain the deterioration of portions of its sewer collection system and the recent discovery of a significant concentration of methane in portions of the District’s outfall sewer. The board wants District customers to understand the need for additional revenue in order to repair and rehabilitate its sewer system prior to making any decisions on a method to generate the revenue.
May 2016: Barrie Brinkley completed the newsletter and supervised printing and distribution to Valley customers. The Valley Board expressed their appreciation for Ms. Brinkley’s efforts.
25
December 2016: Platte Canyon staff has prepared a PowerPoint presentation for the Valley Sanitation District to explain basic facts about the District and describe the need for relocating the portion of the interceptor sewer located in the abandoned landfill. Four informational meetings are being organized by the Board at which time Platte Canyon staff will make a presentation. District staff also assisted the Board in developing a postcard notice for the meetings that will be sent to all District residents in early 2017.
January 2017: Alyssa Quinn and Scott Hand have prepared a PowerPoint presentation for use at several Valley open house sessions. These meetings are being scheduled throughout the District in February, March, April and May. The presentation consists of an overview of District functions, information on District assets, and financial information. The location, age and condition of the District’s outfall sewer is emphasized along with the engineering study recommending relocation of a portion of the sewer main.
February 2017: The first of three open houses was held on February 15. Alyssa Quinn, Scott Hand, Tony Cocozzella participated in the presentation made during the two hour meeting. While only 21 residents attended the session, they were very engaged and offered numerous suggestions and recommendations for engaging more of the community in the District’s efforts to obtain additional revenue to relocate the District’s outfall sewer outside of the abandoned landfill. The meeting was also attended by a Denver Post reporter who wrote an article that appeared in the February 17 issue of the newspaper.
March 2017: During the initial open house to present information on the interceptor sewer problem, a number of attendees suggested that the District prepare a one page fact sheet for distribution to Valley residents. The Valley Board of Directors subsequently asked Platte Canyon staff to draft the fact sheet, obtain Board approval and mail it to all Valley customers. A copy of the fact sheet is attached hereto as Attachment 2.
Outfall Sewer Rehabilitation
The majority of Valley’s outfall sewer main has been lined with either PE pipe or CIPP epoxy lining. However, 1,015 feet or 21-inch and 24-inch concrete pipe located south of Oxford Rd. and west of Platte River Dr. has not been rehabilitated and is experiencing corrosion. Platte Canyon staff has recommended that the pipe be CIPP lined in 2015 and the Valley Board of Directors has authorized design of the project. A contract with ENS Consulting was approved by the Valley Board of Directors during their April 8 meeting.
May 2015: Tony Cocozzella is working with Rich Cassens to develop a bypass pumping pipe alignment and acquire landowner permission for the alignment.
July 2015: Mr. Cocozzella continues to consult with a property owner in the Valley District in an effort to acquire an easement for bypass pumping facilities needed for the rehabilitation of a portion of Valley’s outfall sewer main in the vicinity of Oxford Ave. and Platte River Dr.
26
September 2015: The outfall sewer rehabilitation project has been put on hold pending resolution of the methane contamination situation described below.
November 2015: We have requested a proposal from Dewberry Engineering to investigate alternatives for moving the District’s outfall sewer main out of a landfill located south of Oxford Ave. and west of the South Platte River. As noted below, we recently discovered that the sewer main is collecting methane gas from the landfill, and we therefore do not want to proceed with lining the existing pipe if it is feasible to move it away from the landfill.
December 2015: The proposal to investigate outfall sewer relocation alternatives received from Dewberry Engineering was approved by the Valley Board of Directors during their December 9 meeting.
March 16: Dewberry Engineering is nearing completion of the alternatives analysis for relocating a portion of the District’s outfall sewer from its current location in a landfill. Once completed, the analysis will be submitted to the Valley Board of Directors for discussion and approval. District staff will then initiate a discussion with the Colorado Department of Health and Environment to determine if funding is available to relocate the pipe.
April 2016: Dewberry has completed their report and recommends that the outfall sewer currently located in the abandoned land fill be relocated at a cost of $2.35 million. Dewberry researched two alignments for relocation and determine that only one is a viable option. Relocation will necessitate construction of a sewage lift station which is a major part of the cost estimate. The report will be discussed with the Valley Board of Directors on April 13 after which District staff will seek financing assistance from the State.
May 2016: The Board of Directors accepted Dewberry’s report and requested that Platte Canyon staff pursue financing to relocate the outfall sewer outside of the landfill. As explained above in the Sewer Service Fee and Pipe Condition Assessment section, Ashley Dalton is exploring alternatives for financing rehabilitation of the District’s 8-inch concrete pipe as well as for the relocation of the outfall sewer. The District will need over $2.0 million to complete both projects.
June 2016: The Colorado Department of Public Health and Environment will begin accepting applications for Clean Water Revolving Fund loans on June 15. Ashley Dalton is preparing an application for both the relocation of the portion of Valley’s outfall sewer that is located in an abandoned landfill and the lining of 8-inch concrete collection system pipe. We anticipate the request will total $2,000,000 and will require a TABOR election.
July 2016: Ashley Dalton has submitted the application to get on the loan eligibility list and is now preparing the pre-qualification form which is the next step in the loan application process. The Valley Board will consider a resolution calling for a TABOR election in November to incur debt and assess a mill levy to retire the debt.
August 2016: Ashley Dalton will continue to pursue a loan for construction of a sewage lift station and bypass sewer around the abandoned landfill even though the Valley Board has chosen to delay the TABOR election needed to obtain the loan. The state will allow the District to continue to
27
process the loan application and will make final approval contingent upon voter approval of a TABOR ballot proposal.
September 2016: The recently released Colorado Water Quality Control Division 2017 Intended Use Plan includes Valley Sanitation on the eligibility list for a clean water revolving fund loan up to $2,500,000. The District is also included on a separate list of entities eligible to receive funds in 2017.
October 2016: Alyssa Quinn developed a PowerPoint presentation to explain the services provided by Valley Sanitation District as well as to inform customers of the need for a loan and/or additional revenue to conduct needed repairs to the District’s outfall sewers. The presentation was shown to the Board during their October meeting. The Board suggested a few changes to the presentation and asked that Ms. Quinn present it to various citizen groups over the next few months.
The Board also requested that Ms. Quinn prepare a serious of postcards to be sent to District customers informing them of the important issues confronting the District.
December 2016: We have not been able to devote much attention to pursing the loan after the resignation of the assistant manager. However, District staff has been working closely with the Valley Board of Directions on a public information campaign to explain the need for relocating the outfall sewer away from the abandoned landfill.
January 2017: On behalf of Valley, Platte Canyon staff have requested a proposal from Dewberry Engineering to assist with processing an application for a Clean Water Revolving Fund loan from the Colorado Water Resources and Power Development Authority.
March 2017: Platte Canyon staff met with several members of the Colorado Department of Public Health Loans and Grants Section and the Division of Local Government to discuss the process for obtaining a State Revolving Fund loan for relocating the interceptor sewer outside of the abandoned land fill. The dialog was very informative and we are proceeding with Valley Board authorization to process a loan for $2.5 million.
Outfall Sewer Methane Contamination
Littleton – Englewood Wastewater Treatment Plant staff discovered hazardous levels of methane in portions of Valley’s outfall sewer main. The sewer main traverses an old landfill and decomposing trash is apparently infiltrating the sewer main and/or manholes. District staff is negotiating a contract with a consultant to evaluate options for moving the 18-inch sewer main from the land fill. It is very likely that a sewage lift station will be required if the sewer is relocated. Since the District does not have sufficient reserves to construct a lift station and relocate the sewer, we intend to seek funding from the state.
March 2017: See discussion above in the Outfall Sewer Rehabilitation section.
28
Denver Water Department Matters
Board - Distributor Communication
The February Forum meeting included the introduction of Fletcher Davis, Denver Water’s new rate manager, and presentations by Gary Booth, manager of property, and Russ Slade from the planning department. The March meeting will be conducted at American Water Works Association and will include a presentation on Denver Water’s Integrated Resources Plan.
Denver Water has scheduled a Read & Bill listening session on March 29 to respond to issues and concerns encountered by Read and Bill Distributors.
Moffat Collection System – Gross Reservoir Expansion Project
The purpose of the Moffat Collection System project is to develop 18,000 acre feet of new annual firm yield to the Moffat Treatment Plant and raw water customers upstream of the Moffat Treatment Plant. In October 2003, the U.S. Corps of Engineers (COE) conducted a public consultation to satisfy National Environmental Policy Act (NEPA) requirements. A project scoping report was issued in December 2003. Dozens of project alternatives have reviewed and it is anticipated that a draft Environmental Impact Statement (EIS) listing three or four final alternatives will be issued in mid-2007. A final EIS is scheduled to be completed by year end 2007. The Scoping Report and additional project information is available at www.denverwater.org/MOFFAT_EIS html.
The Board of Water Commissioners selected the large Gross Reservoir expansion as the preferred Moffat Collection System alternative. The formal announcement and filing of the decision with the Bureau of Reclamation will be made when the draft environmental impact statement is completed. The draft EIS is scheduled for completion in 2009.
In May 2008, Denver Water initiated the process necessary to amend its Federal Energy Regulatory Commission (FERC) license for Gross Reservoir. The amendment is needed to proceed with the reservoir expansion project. In July 2008, a Pre-Application Document (PAD) for the FERC Permit was published for review and comment.
Additional information pertaining to the Gross Reservoir Enlargement Federal Energy Regulatory Commission (FERC) permit is posted on the Denver Water website at www.denver.org under the “Public Notices” and “Gross Reservoir FERC Amendment” tabs.
August 2009: The Board of Water Commissioners formally selected the Gross Reservoir enlargement of 72,000 acre feet as the preferred alternative for the Moffat Collection System project. The Board directed staff to file a Section 404 permit application for the preferred project
29 alternative. Denver Water staff reports that the draft EIS will be released for public comment by the U.S. Army Corps of Engineers this September.
The U.S. Army Corps of Engineers (Corps) released the Draft Environmental Impact Statement for Denver Water’s Moffat Collection System Project in November 2009. Public hearings were held in Boulder, Granby, and Denver in early December 2009. Letters from Platte Canyon and Southwest Metropolitan supporting the Moffat Collection System project were submitted to the Corps in March 2010. The DEIS is available for viewing or download at www.denverwater.org/moffat.
The Corps determined that additional studies are needed to fully address possible project impacts. The studies are being directed by the Corps and will be completed in 2011. The primary issues raised in the comments relate to water quality, groundwater, aquatic resources, flow-related impacts, construction concerns, cumulative effects and mitigation of impacts.
July 2011: The Colorado Wildlife Commission approved the Moffat Collection System Project Fish and Wildlife Mitigation Plan on June 9, 2011. The Plan will now be submitted to the Colorado Water Conservation Board (CWCB) for approval. When it is approved by CWCB, the Plan will be transmitted to the U.S. Army Corps of Engineers as the official state position for mitigation for the Moffat Project.
November 2011: Work is continuing on additional environment impact studies to address issues raised by EPA. The main issue is the potential impact (or lack thereof) on wetlands adjacent to the Fraser River from reduced flows in the river during certain times of year. Studies indicate there will be NO impact yet EPA is requesting that the project permit contain a reopening clause that would reduce or eliminate project yield should there be an impact on the wetlands in future years. This is totally unacceptable to Denver Water.
January 2012: Speaking at the January 17, 2012 meeting of the Distributor Forum, Jim Lochhead expressed increasing frustration with federal agencies involved in the permitting process for the Moffat Collection System project. The time taken to acquire necessary federal permits now exceeds the Two Forks Reservoir permitting process. Further, over $13.0 million has been spent to date. A final Environmental Impact Study is not expected to be release prior to 2013, and there are now calls to reconsider some of the environmental studies because they have “become stale”. Mr. Lochhead indicated that Denver Water is increasing its communication with Colorado’s congressional delegation in an attempt to pressure federal agencies to expedite the completion of the EIS.
July 2012: Governor Hickenlooper recently sent a letter to President Obama in support of the Moffat Collection System Project. The letter urges the President to exercise his authority to coordinate federal agencies to bring about an “expeditious conclusion to the federal permitting processes”. Environmental studies for the Moffat project now exceed the length of time it took to produce a final Environmental Impact Study for Two Forks Reservoir. A copy of the Governor’s letter is available upon request.
30
November 2012: The Colorado Environmental Coalition (CEC) and other environmental groups have sent a letter to the Army Corps of Engineers opposing Governor Hickenlooper’s request that the Environmental Impact Statement be expedited. The CEC is opposed to “fast-tracking” completion of the EIS because, in their opinion, there are a number of unresolved issues that require more detailed analysis. This claim is made despite the fact that the Moffat EIS has already taken longer than the EIS for Two Forks Reservoir and has been amended a number of times to respond to requests for additional data and analysis.
January 2013: Denver Water negotiated on extensive intergovernmental agreement with Boulder County staff to address mitigation for Gross Reservoir expansion. The agreement was drafted to resolve a host of issues and concerns expressed by County staff and Commissioners relative to the proposed Moffat Collection system project. A large contingent of staunch environmentalists organized opposition and testified against the agreement during the public hearing held to receive comments on the agreement. Despite a very generous mitigation package, and a recommendation from County staff to approve the agreement, the Board of County Commissioners refused to approve it. Denver Water staff has indicated that they will seek direct discussions with County Commissioners, one of which took office after the decision was made to not approve the agreement. Denver Water staff has also reported that it is unlikely that the County can halt the project or impose mitigation measures more extensive than those proposed in the intergovernmental agreement since the project’s Federal Energy Regulatory Commission permit takes precedence over the County’s 1041 regulatory authority. A Boulder Daily Camera article describing the public hearing and the commissioner’s decision together with a Denver Post editorial supporting the Moffat Collection System project is available upon request.
March 2013: The US Army Corps of Engineers issued a press release on March 4, 2013 stating that the Moffat Collection System Project Final EIS will be completed in February 2014. Recall that Governor John Hickenlooper requested that President Obama use his authority to coordinate federal agencies to bring an expeditious conclusion to federal permitting process for the project. Apparently, the Corps has a different interpretation of the work “expeditious”. The EIS has been in process since 2003. Denver Water CEO/Manager Jim Lochhead issued the following statement in response to the Corps’ press release:
“We are pleased to see the state and federal agencies come together to commit to a sound timeline for the release of the Final Environmental Impact Statement for Denver Water’s Moffat Collection System Project next February.
We’re in the second year of a severe drought. If the Moffat Project were in place today, we would have been able to store more water during the high flow runoff two years ago that we could now use. In a dry year like this one, we would not be diverting additional water under this project.
Moreover, under the Colorado River Cooperative Agreement, we would actually be giving water back to the environment in this dry year. As a result, Denver Water’s Moffat Project would be a win-win for this state: it would make possible our ability to benefit the environment in dry years like this
31
one, and it would bring additional water for our metro area, which we desperately need in this drought.”
The Board of Water Commissioners approved on February 27, 2013 an increase of $1,591,992 in the URS Engineering contract for the EIS. The total cost of the contract is now $9,811,799.
August 2013: A letter to the editor criticizing the Moffat Project appeared in the Denver Post on July 26, 2013. The letter was written by Drew Peternell, director of Trout Unlimited’s Colorado Water Project. Denver Water had recently agreed to work with Trout Unlimited on project mitigation measures and attempt to resolve ongoing concerns. Denver Water staff is upset that the letter appeared without warning and without acknowledgment of Denver’s agreement to work with them.
September 2013: I have encouraged Jim Lochhead to convene a meeting of Denver Water distributor elected officials to explain the status of the Moffat project so they can better understand the implications of some of the criticism and proposed mitigation measures being advanced by opposition groups. Seemingly simple solutions such as guaranteed minimum stream flows on the Fraser River would destroy the yield and financial viability of the project, yet the general populace does not understand the impact of such a proposal. Elected water district and municipal officials should have more knowledge regarding these issues so they can better inform their constituents as the project moves forward.
October 2013: Denver Water responded to the above referenced letter to the editor prepared by Drew Peternell with a blog posting on Denver Water’s website. The response was unfortunately not sent to the Denver Post. A copy of the Peternell’s letter and Denver Water’s blog post is available upon request.
February 2014: The release of the Environmental Impact Statement has been delayed by the Corps of Engineers to April 2014. In the meantime, I am continuing to press Denver Water to convene a meeting with distributor representatives and elected representatives to provide information about the project in anticipation of a media campaign by individuals and groups opposed to the project. Recently, Trout Unlimited conducted a silly media blitz involving an individual dressed as a fish holding a sign reading, “will work for water.”
March 2014: Denver Water achieved a significant accomplishment recently by reaching agreement with Trout Unlimited and Grand County on a mitigation plan for the Moffat Collection System Project. Trout Unlimited has been one of the most vocal and aggressive opponents of the project, and Grand County has a large influence on the development and acceptance of the final project mitigation plan. The recent mitigation agreement coupled with the Colorado River Cooperative Agreement, which committed West Slope entities to not oppose the project, greatly increases Denver Water’s chance of success in obtaining a positive Record of Decision and permit for the project later this year. The ACOE is scheduled to release the final EIS in mid-April, and issue a record of decision and permit in late 2014 or early 2015. (Copies of articles relating to the Trout Unlimited, Grand County and Denver Water Agreement together with an Executive Summary of the Agreement are available upon request.
32
Denver Water engineering staff provided an excellent presentation to the Distributor Forum in February on the status of the Moffat Collection System Project. A significant amount of preliminary engineering work is being done now in anticipation of receiving federal permits for the project. The presentation included a discussion of a number of critical issues that Denver Water is working to resolve in order to receive permits and move forward with design and construction, one of the most important of which is determining the method for raising Gross Reservoir Dam. If roller compacted concrete is used to raise the dam, it will be one of the most extensive roller compacted concrete jobs ever attempted. Staff also touched on the project budget which has increased from $183 million in 2006 to over $300 million today. Finally, an internet link was provided for a San Diego, California project similar to the Gross Dam project. The link is http://www.sdcwa.org/san-vicente-dam-raise.
April 2014: Denver Water worked with Colorado Parks and Wildlife (CPW) and the Colorado Wildlife Commission to develop an official state position for the Moffat Collection System Project’s Fish and Wildlife Mitigation Plan. In addition to the Fish and Wildlife Mitigation Plan, Denver Water and the Northern Colorado Water Conservation District Municipal Subdistrict (Subdistrict) submitted Fish and Wildlife Enhancement Plans (Enhancement Plans) to improve existing aquatic habitat in the mainstream of the Colorado River between Windy Gap Reservoir and the Kemp-Breeze State Wildlife Area. The Enhancement Plans identify a combined $6.0 million in funding for initial construction and $1.5 million for adaptive management and/or maintenance for the Upper Colorado River Habitat Project. Denver Water and the Subdistrict have also agreed, when possible, to provide in-kind service (such as labor, equipment, and materials) to help maximize the value of the funds contributed by the parties. [from Denver Water Board Item]
Under the Enhancement Plan, and committed through an Intergovernmental Agreement between CPA and Denver Water, Denver Water will pay $2.0 million for its share of the Upper Colorado River Habitat Project.
May 2014: The final Environmental Impact Statement (EIS) for the Moffat project was released by the Army Corps of Engineers (Corps) on April 25. A scheduled 45 day comment period will likely be extended due to the length and complexity of the EIS. It is anticipated that the Corps will issue a Record of Decision on the project in 2015. The EIS is available for review or download at http://cdm16021.contentdm.oclc.org/ cdm/ref/collection/p16021coll7/id/720. A copy of the Executive Summary is available from District staff upon request. A brief summary of the project prepared by Denver Water together with three recent newspaper articles are available upon request.
June 2014: Denver Water staff provided a briefing on the status of the Moffat Collection System Project during the June Distributor Forum meeting. I have been critical of Denver Water for not providing more information to distributors so they can respond to questions and concerns about the project received from their customers. Denver Water believes that it is better to work individually with groups that oppose the project rather than to publicly promote the project. I do not agree with Denver Water’s position and have encouraged staff to at least provide more information to distributors so they are informed about important project developments and can communicate them to their customers, even if Denver Water chooses not to do so with their own customers.
33
September 2014: As a clear indication that there are still major hurdles to overcome before the Moffat project is fully permitted and ready to move forward with design and construction, I have attached Boulder County’s letter commenting on the Final Environmental Impact Statement. Among other ridiculous notions, Boulder County seems to be demanding that the project be fully designed and every conceivable impact known, addressed and mitigated before permits are issued. The time and expenditure to comply with these requirements would be tremendous and foolish without some assurance the project will be allowed to proceed. Further, many of the issues outlined in the letter were addressed in a draft mitigation agreement between Boulder County and Denver Water that Boulder County staff had recommended to the Board of County Commissioners about a year ago. The Commissioners refused to approve the agreement and have not pursed serious negotiations since then.
July 2015: The Record of Decision (ROD) for the Moffat Collection System Project has once again been delayed by the U.S. Army Corps of Engineers to allow more time to wrap up paperwork. “Denver Water has to obtain a water quality certification from the state and they have to obtain a license from the Federal Energy Regulatory Commission,” according to Rena Brand, ACOE project manager. “They also have some other permissions they need to obtain – one is through the U.S. Fish and Wildlife Service addressing endangered species. And there’s also some cultural resources permissions and documents that need to be written up,” Brand said. The ROD is now expected to be issued sometime this fall.
November 2015: Denver Water staff provided a comprehensive status report on the Moffat and Gross Reservoir expansion project during the October Distributor Forum meeting. Subsequent to the meeting, the Army Corps of Engineers announced another delay in releasing the Record of Decision to sometime in 2016.
April 2016: A Colorado Water Court approved an agreement between Grand County and Denver Water accepting Denver Water’s obligation to release 2,000 acre-feet of water between the Colorado River and tributaries of the Fraser River. The water will come from Denver Water’s Moffat Collection System in the Fraser Valley and Williams Fork Reservoir. The releases are contingent upon the permitting and construction of the Gross Reservoir Expansion Project. Denver Water has also agreed to provide delivery of 375 acre-feet of water to various Grand County water users for municipal purposes and snow making. The Court Decree moves Denver Water one step closer to obtaining approval of the Moffat/Gross Reservoir Expansion Project.
July 2016: The Colorado Department of Public Health and Environment issued a Section 401 Water Quality Certification for the Gross Reservoir Enlargement project. All necessary permits from Colorado agencies have now been obtained leading Governor Hickenlooper to formally endorse the project. The Governor has directed all state agencies to work with the U.S. Army Corps of Engineers in its review and issuance of a Section 404 Permit for the project. The Corps is expected to complete its review and issue a record of decision later this year. A copy of the Governor’s letter is available upon request.
January 2017: Following the issuance of the Section 401 Water Quality Certification by the Colorado Department of Public Health and Environment, Denver Water filed an application for a
34 necessary permit for the Gross Reservoir Expansion from the Federal Energy Regulatory Commission.
March 2017: Denver Water has requested that distributors and interested parties consider writing letters of support for the pending Federal Energy Regulatory Commission (FERC) permit for the Gross Reservoir Enlargement project. The FERC permit is necessary for Denver Water to continue to operate the hydroelectric facilities at Gross Reservoir. I am preparing a letter to FERC on Platte Canyon’s and Southwest Metropolitan’s behalf.
Water Conservation
Alyssa Quinn, Chair of the Distributor Water Conservation Subcommittee has been working with Denver Water staff to develop a Children’s Water Festival program. Ms. Quinn was working on developing such a program for Denver Water distributors when she learned that Denver Water was also beginning to plan for a water festival inside Denver. She reminded Denver Water staff that distributors represent one-half of Denver Water customers and revenue, and a joint effort to coordinate development of a water festival which would be available to the entire Denver Water service area would be a much better approach. Denver Water has somewhat reluctantly agreed and is working with Ms. Quinn and other distributors to bring the water festival concept to fruition.
Alyssa Quinn participated as a representative of Denver Water Distributors in a LEAN rapid improvement event for the conservation rebate program. Rapid improvement events are designed to seek out process efficiencies and eliminate waste. We were pleased that Denver Water sought distributor input because their staff often does not understand, or attempt to consider the impact Denver Water procedures and processes have on distributors and their customers.
March 2015: The Colorado Water Conservation Act of 20014 requires water providers that supply over 3,000 acre feet of water to have a state-approved water efficiency plan containing certain required minimum plan elements. The plans are required to updated and re-approved ever seven years. Denver Water has updated the integrated system water conservation plan approved in 2007 and submitted it to the Colorado Water Conservation Board for approval.
May 2015: Denver Water Conservation staff recently presented its annual review of water conservation programs to the Board of Water Commissioners. A copy of the presentation is available upon request.
March 2016: Denver Water is forming a stakeholder group to consult with on revisions to its Water Conservation (now referred to as Water Efficiency) Plan. There will be a distributor representative on the group and Denver Water is encouraging someone other than Alyssa Quinn to be the official member. Alyssa chairs the Distributor Water Conservation Subcommittee, is on the board of directors of WaterWise and has been the most active distributor representative working on Denver Water conservation matters. It appears to be the same game that Denver Water played with the rate structure stakeholder group. Alyssa has contacted other members of the conservation committee and none of them are willing to devote the time and attention needed to be an effective distributor advocate. Therefore, we are going to nominate Ms. Quinn as the
35
distributor representative and will be as forceful as necessary to ensure distributors are well represented.
April 2016: Alyssa Quinn has been informed that she has been appointed as the Denver Water Distributor representative on the Water Efficiency Plan stakeholders group.
June 2016: The Water Efficiency Working Group had their first meeting on May 25. The meeting was largely devoted to establishing protocols, goals and expectations for the group. Essentially, the group is charged with updating Denver Water’s water efficiency (conservation) plan.
January 2017: The Water Efficiency Working Group, of which Alyssa Quinn is a member, will conclude their work and present the results of their meetings and recommendations to the Board of Water Commissioners in February.
March 2017: The Water Efficiency Working Group has completed its work and issued a final recommendation report for review and comment from stakeholders and other interested parties. The report will be finalized and delivered to the Board of Water Commissioners in April 2017. A copy of the report is available upon request.
Integrated Resource Plan
Mark Wagge from Denver Water presented a status report on the Integrated Resource Plan during the July Distributor Forum. Denver Water has slowed work on the IRP until a federal permitting decision is made on the Moffat Expansion Project. However, Mr. Wagge reported that “based on several fundamental assumptions, including those listed below, Denver Water has sufficient water supply to meet its customers’ short-term needs through approximately 2030:
1. The enlargement of Gross Reservoir is completed, along with the non- potable recycling project and downstream gravel pit storage projects; 2. Denver reaches its goals in the 2016 water conservation plan, which they are on track to do; and 3. Denver Water does not suffer a major loss of supply or have a major change in climate during this period.
February 2014: I have requested that Denver Water staff make a presentation during a future Distributor Forum meeting on the current status of the Integrated Resource Plan. Distributors are particularly interested in Denver Water’s study of conjunctive use of ground water and surface water (see Aquifer Storage and Recovery Pilot Project below). The presentation has preliminarily been scheduled for the March 18, 2014 Forum meeting.
March 2014: As reference above in the Denver Water – Distributor Communication section, Denver Water staff provided a presentation on Aquifer Storage and Recovery during the March 18 Forum meeting. Additional projects being considered as part of the Integrated Resource Plan will be discussed during future Forum meetings.
36
January 2016: Denver Water delayed work on its Integrated Resource Plan until the Moffat Collection System Project was nearing the end of the permitting phase. They now believe that the permitting is far enough along that they can once again begin work on the plan. Staff recently had a work study session with the Board of Water Commissioners and is scheduled to make a presentation to distributors on the work plan for the coming months during the January 19 Distributor Forum meeting.
May 2016: Mike King, director of planning for Denver Water, recently stated during the spring water user’s meeting of the Northern Colorado Water Conservation District that Denver Water will not be seeking additional diversions from the West Slope for the foreseeable future if the Gross Reservoir expansion project moves forward.
June 2016: As reported by Jim Lochhead during the recent distributor breakfast meeting, Denver Water is working on an update of the Integrated Resource Plan. The project is expected to take 18 months.
July 2016: A lengthy presentation on the Integrated Resource Plan (IRP) was provided to the Board of Water Commissioners during its July 13 meeting. I was unable to attend the meeting, but will request that a presentation be brought to a future Distributor Forum meeting. Jim Lochhead mentioned during the most recent manager’s breakfast meeting that Denver Water will engage with, and inform important stakeholders such as the Distributor Forum on the IRP process.
March 2017: Denver Water staff is currently updating the agency’s Integrated Resource Plan to “institute a secure water future for customers through 2065”. Staff is using a planning method called scenario planning which plans and prepares for multiple futures based on many different factors rather than focusing on a single predication of the future based largely on historical circumstances and conditions. Once the current system assessment is complete in late 2017, staff will begin a gaps and opportunities analysis and estimate completing the plan around July 2018
Denver Water staff is scheduled to make a presentation on the IRP during the March 21 Distributors Forum meeting.
South Platte River Environmental Pool
Denver Water has committed $2 million to fund the purchase of 250 acre-feet of storage space in Chatfield Reservoir for the purpose of providing environmental flows through the urban corridor in times of diminished flow. The contribution is contingent upon the Greenway Foundation raising funds to match the Denver Water funds. A copy of a press release announcing the program is attached hereto as.
37
Littleton - Englewood Wastewater Treatment Plant Matters
Open House
Littleton Englewood Wastewater Treatment Plan opened in April 1977. To celebrate the 40th anniversary of the plant, staff is proposing an open-house on Thursday April 20, 2017. I will provide additional information as I receive it in the event that Platte Canyon and Southwest Metropolitan directors want to attend.
Joint City Council Meeting
I attended a joint City Council meeting held to receive information and discuss treatment plant administrative and operational issues. Some council members chose to use the meeting as a forum to criticize staff rather than have an informative and productive discussion about permitting and potential capital improvement cost issues confronting the plant. Despite the wasted time and distractions, other council members raised questions about the possible benefits and downside of requesting a reduction in the permitted capacity of the plant and the potential large costs involved with meeting proposed nutrient standards. The two councils decided to reconvene in the next two months to continue the discussion. At that time more information should be available on the final, revised plant discharge permit and effluent standards that may cause a need to invest in new treatment technologies and processes.
Pretreatment Program
Littleton- Englewood Treatment Plant staff have scheduled a meeting to discuss with connector district representatives a recent audit of the pretreatment program conducted by the EPA. One of the issues raised by the EPA is the apparent lack of designation of authority to enforce pretreatment standards. In order to clarify authority for enforcing pretreatment regulations, plant staff have proposed an amendment to each districts connector agreement. Scott Morse and I have been consulting with pretreatment staff and have proposed an arrangement similar to the Denver Water integrated system agreement between Denver Water and all distributors. The amendment to each connector agreement mimics the concept we have been promoting.
January 2015: Littleton Englewood Wastewater Treatment Plant (Plant) staff together with Englewood and Littleton staff have submitted a proposed addendum to Wastewater Connectors for review and comment. The addendum seeks to clarify each entities responsibilities and obligations to implement and enforce Clean Water Act Industrial Pretreatment Regulations. I am working with Tim Flynn to prepare comments on behalf of Platte Canyon, Southwest Metropolitan, and Valley. I am also working with Icenogle Seaver Pogue, PC to prepare comments on behalf of Columbine Water and Sanitation District.
38
February 2015: Comments on the proposed amendment to the Littleton and Englewood Connectors’ Agreements have been submitted by Columbine, Valley, Platte Canyon and Southwest Metropolitan. The Englewood Littleton Treatment Plant’s attorney will now work with the Littleton and Englewood City attorneys to draft a uniform amendment that all connectors will be expected to approve.
March 2015: Littleton Englewood Treatment Plant staff have reported that comments received on the proposed connector’s agreement addendum have been referred to the plant’s attorney and the two city attorneys. The goal is to consolidate the comments and produce one addendum for all connectors to sign.
January 2016: Treatment plant staff have reported that the proposed pretreatment addendum to the Littleton and Englewood connector agreements will be submitted to the Littleton Englewood Wastewater Treatment Plant Supervisory Committee for approval in December. Upon approval, the addendum will be submitted to connector districts for approval and execution. I have objected to submittal of the agreement to the Supervisory Committee before the final draft version is submitted to the connector districts for review and comment. I have been told that the agreement will be presented to the connector districts prior to approval by the Supervisory Committee, but I have yet to receive the agreement.
February 2016: As referenced above, the Littleton – Englewood Wastewater Treatment Plant Supervisory Committee directed plant staff to refer the final draft of the pretreatment addendum to connector districts prior to seeking approval by the supervisory committee. To date, plant staff has yet to submit the final addendum to connectors.
April 2016: Platte Canyon, Southwest Metropolitan, Bow Mar, Columbine, and Valley are in receipt of the Pretreatment Addendum transmitted by the Littleton–Englewood Wastewater Treatment Plant (Plant) pretreatment staff. None of the changes requested by Tim Flynn on behalf of Platte Canyon, Southwest Metropolitan, Bow Mar and Valley, and Jennifer Ivey on behalf of Columbine were made to the draft Addendum. I have informed Plant staff that the two attorneys and District staff cannot recommend approval of the Addendum to the districts’ boards of directors until changes are made, or a meeting is convened to discuss the districts’ concerns.
May 2016: As referenced above, David Robbins, attorney for the treatment plant is going to contact each connector district attorney that provided comments on the Pretreatment Addendum.
July 2016: David Robbins, attorney for LEWWTP, is in the process of contacting connector district attorneys to discuss their concerns about the pretreatment addendum.
October 2016: David Robbins, attorney for the Littleton Englewood Wastewater Treatment Plant, has met with Tim Flynn and Jennifer Ivey, attorney for Columbine Water and Sanitation District, to discuss their concerns with the pretreatment addendum. He is drafting a revised addendum to address some, or all of the issues brought to his attention.
39
Pretreatment staff have drafted proposed changes to industrial pretreatment sections of the City of Littleton and City of Englewood municipal codes. The changes address corrective actions required by EPA in the 2014 pretreatment audit of the Industrial Pretreatment Program, changes required in the 2016 Pretreatment Compliance Inspection, recommended by EPA per the Pretreatment Streamlining Rule, and changes recommended by the L/E WWTP Industrial Pretreatment Division. Each City Council is scheduled to consider the proposed changes on first reading in early December and on second reading in early January 2017.
December 2016: Several attorneys for Littleton and Englewood connector districts and municipalities have reached an agreement on a final version of the Pretreatment Addendum to the connector agreements. The Addendums for Platte Canyon and Southwest Metropolitan will be placed on the December meeting agenda for Board consideration.
January 2017: Platte Canyon, Southwest Metropolitan, Valley, Bow Mar and Columbine have all approved the pretreatment addendum. Littleton is preparing a revision to its municipal code to incorporate EPA requested revisions into the sanitary sewer regulations. I have requested the connector districts be given an opportunity to review and comment on the proposed revisions prior to scheduling a public hearing before City Council.
March 2017: Littleton and Englewood are revising the wastewater section of their respective municipal codes to incorporate revisions to the administration and enforcement of the pre- treatment program. EPA Region 8 has reviewed and accepted the proposed code revisions. The cities will hold study sessions and public hearings on the code revisions in April.
Discharge Permit
Littleton – Englewood Wastewater Treatment Plant is expecting the Colorado Water Quality Control Division to issue a draft of the renewal of the plant’s discharge permit within the next few weeks. Once issued, the plant is given two weeks to review the permit prior to issuance of a public notice and a 30 day public review period. Following the review period the Division will review comments, amend the permit at its discretion, and issue the final permit.
June 2016: Littleton Englewood Wastewater Treatment Plan (Plant) staff reports that the Plant’s National Pollutant Discharge Elimination System (NPDES) permit will be issued for public notice in June. The Plant does not receive a copy of the draft permit before if goes public. Staff reports that it is very likely there will be updated nutrient removal requirements for nitrate and phosphorus that will increase the Plant’s chemical costs for nitrate reduction, and will also require additional treatment equipment at a potential cost of $6 to $8 Million for phosphorus control.
August 2016: Littleton Englewood Plant staff met with Colorado Department of Health staff to discuss the impending draft discharge permit. CDPHE staff would not discuss or reveal specific permit parameters but did offer comments on general permit provisions. The permit was scheduled to be offered for public comment on July 22 for a 60 day period. Plant staff are scheduled to provide an overview of the permit to the Littleton City Council August 23.
40
September 2016: Public notice for issuance of the discharge permit was published on July 22 with a September 22 deadline for comments. L/E WWTP staff are working with Brown and Caldwell, engineers for the plant, to analyze permit conditions and provide comments to the Water Quality Control Division.
Littleton City Council held a study session on August 23 to receive a presentation from L/E WWTP staff on the draft discharge permit
October 2016: Brown and Caldwell and David Robbins have submitted comments on the draft discharge permit on behalf of the Littleton Englewood Wastewater Treatment Plant. The Department of Health will consider all comments and issue the final permit later this year. One issue strongly opposed by Littleton and Englewood is the Water Quality Control Division requirement that the plant add an assumed 10% increase to the plant’s discharge to create a reserve to accommodate future requests from property owners to discharge water from basement dewatering systems into the sewer system. The Cities prohibit such discharges, and therefore claim that a “reserve” is unnecessary.
March 2017: Plant staff has met twice with the Colorado Water Quality Control Division to discuss issues with the draft discharge permit. A copy of a document prepared by plan staff that describes some of the permitting issues is attached hereto as Attachment 3.
Treatment Plant Capacity
During a joint meeting of the Englewood and Littleton City Councils, a couple of council members requested information on potentially reducing the permitted capacity of the treatment plan. Hill and Robbins, attorneys for the plant, were asked to prepare a memo analyzing the possible legal and regulatory ramifications of decreasing the capacity. Brown and Caldwell, engineers for the plant, were asked to analyze the cost differences involved in a reduction in plant capacity. This issue has implications on all of the connector districts so I have requested a copy of the memo and an opportunity to comment on the matter.
March 2017: Some members of the Littleton and Englewood City Councils have proposed reducing the permitted capacity of the treatment plant to reduce the cost of future capital expenditures. Plant staff and the plant’s attorney have advised the council members that there are ramifications that must be considered before any decision is made to reduce capacity, including the possibility of breaching sewer connector agreements with a host of connectors. So far there has been no discussion between the plant, cities and connector districts regarding the needs of the connectors.
I have attached a copy of a memo prepared by the plant attorney’s, David Robbins and Matt Montgomery regarding this issue (Attachment 4). In the discussion about connector district contracts the memo states, “Although the contracts with the Connector Districts are limited in duration, and thus theatrically terminable at some point in the future, the Plant’s refusal to treat the wastewater from the Connector Districts would likely result in significant impacts on public-health, safety and the environment: therefore, it is unclear whether the
41
Cities would ever actually be able to extract themselves from the responsibility to treat wastewater from the Connector Districts.”
Compliance Inspection
On October 23, a compliance inspection of the treatment plant was conducted by the Colorado Water Quality Control Division. The inspection reviewed biosolids disposal, storm water compliance, records review, a review of 2015 sanitary sewer overflows and a plant walkthrough. No compliance issues were identified.
Colorado Legislation, Regulation, and Litigation
Colorado Legislation
The Colorado General Assembly convened its 2017 session on January 11, 2017. I will once again monitor legislation by participating in the Colorado Special Districts Association and Colorado Water Congress legislative committees. A Colorado Legislative Report will be sent separately from the manager’s report.
Colorado Water Plan
Governor Hickenlooper issued on May 14, 2013 an Executive Order (EO) directing the Colorado Water Conservation Board (CWCB) to commence work on a Colorado Plan. The EO referenced work done by the Interbasin Compact Committee and Basin Roundtable processes as providing a basis for preparation of the Water Plan. In addition, the EO directed the CWCB to utilize the Interbasin Compact Committee and the Basin Roundtables in drafting the Colorado Water Plan. The Colorado Water Conservation Board initiated a preliminary discussion on the preparation of a Colorado Water Plan during its Board meeting held on July 16 and 17, 2013 in Alamosa, Colorado. The CWCB staff recommended a framework for the plan including the following elements:
• Reflect Colorado’s values -Productive economy that supports vibrant and sustainable cities, viable and productive agriculture, and a robust skiing, recreation, and tourism industry -Efficient and effective water infrastructure promoting smart land use -A strong environment that includes healthy watershed, rivers and streams, and wildlife • Align projects, studies, funding • Determine opportunities for water rights held by state agencies and evaluate opportunities for those rights 42
• Align State’s role in project permitting and emphasize expediting permitting processes for projects that stress conservation, innovation, collaboration, and other criteria • Recognize link between water quality and quantity • Work with other state and federal agencies • Address the looming gap between water supply and demand while minimizing the buy-and-dry of irrigated agriculture • Protect Colorado’s compact entitlements • Recommend legislative changes where necessary for implementation • Affirm the doctrine of prior appropriation
Basin Roundtalbles were directed to complete basin implementation plans to explain existing water sources, future needs for water and the gap between current supplies and future needs. The basin plans were expected to be the basis for development of the water plan. The basin plans were completed and submitted to the CWCB in July 2014. As expected, the Colorado Basin plan emphasized water conservation, and provided for transbasin diversions only as a last resort after all other options to solve other basin water supply gaps have been exhausted. The Platte River and Metro Basin plans called for enhanced conservation also, but recognized the need for agricultural and transbasin diversion to eliminate the front range water supply gap.
The Front Range Water Council, a group of large east slope water providers, recently submitted a letter signed by Jim Lochhead demanding that the Colorado Water Plan contain some “assurance, and not simply a hope, that a new supply project will, in fact, be a fundamental part of the total “filling the gap” package.” The West Slope, on the other hand, continued to assert that no new water supply project could be planned or studied until it was determined exactly how much Colorado River water is available for development given the impacts of climate change and the possibility of a Colorado River Compact call.
In September 2014, the Colorado General Assembly’s Interim Water Committee held hearings throughout the state on development of the Colorado Water Plan. The hearings were required by legislation passed in 2014 to enable the legislature to maintain involvement in the Water Plan.
The draft Colorado Water Plan was released for public review and comment in November 2014. The CWCB approved the draft water plan and forwarded it to Governor Hickenlooper on December 9, 2014. The plan was also made available for public review and comment before being revised and finalized for submittal to the Governor by the deadline of December 10, 2015.
John Stulp, the governor’s water advisor, described the plan as achieving five major goals: fostering collaborative solutions to address the state’s looming supply gap, creating alternatives to the buy and dry of agricultural lands, protecting Colorado’s compact entitlements, pushing federal regulators to move more quickly on approval processes, and aligning state policies with dollars.
One of the largest controversies that arose over the draft plan was whether the Conceptual Agreement (see Conceptual Agreement section below) which describes the method and requirements for pursing future transmountain diversions should be included in the plan. West Slope interests that oppose additional transmountain diversions expressed opposition to including
43
the concept in the plan until it underwent additional discussion and was accepted by West Slope parties.
The deadline for public comment on the draft Colorado Water Plan was May 1, 2015. By that date the state had held more than 850 river basin roundtable meetings at the local level and received more than 24,000 comments on the draft plan.
The second draft of the water plan was released on July 7, 2015 and was offered for review and comment until September 17, 2015 at which time the plan was scheduled to be finalized and submitted to Governor Hickenloope in in December of 2015. During a presentation to the Special District Association John Stulp, Governor Hickenlooper’s water advisor, stated that “the water plan will call for a cultural change affecting how the state’s residents, farms and businesses use water, in part, at least, because there are going to be so many of them.” According to the state demographer, Colorado’s population is expected to double in the next 35 years. “We will have to provide for the next five million citizens very differently than we did for the first five million,” Stulp said. “We will have to learn how to live differently.”
Stulp stated that the revised draft water plan would call on municipalities and industrial water users to conserve up to 400,000 acre-feet of water. The state’s role in that conservation is to provide “best practices” management to the local communities. “There’s nothing like a drought to get you in the mod to conserve,” Stulp said. But nobody is off the hook for conservation and that includes agriculture. “Ag is getting better at preserving water rights,” he said.
Several changes were made in the second draft of the Colorado Water Plan. The biggest change from the first draft was the addition of a chapter that focused on actions that the CWCB could take on its own, with legislative recommendations taking a secondary role. There was also more information included about climate change and the potential impact on water supplies. Further, there was a new goal for reducing municipal water demand by 400,000 acre-feet. The draft plan identified the municipal water demand reduction as a “stretch goal.” The plan stated that the goal would require changes in customer behavior, new regulatory mandates, possible land use controls and innovations in technology. This would result in “high levels of customer participation,” according to the draft.
Another change to the second draft was the inclusion of the “conceptual framework” for development of future trans-mountain diversions. Many West Slope parties opposed the inclusion of any discussion of trans-mountain diversions in the plan and continued to insist that there is no more water on the West Slope available for diversion without risking a call on the Colorado River from downstream states. The draft also included a section on land use and its relation to water demand and supply. A number of stakeholders promoted land use as the way to achieve greater efficiency of existing water supplies, and a way to avoid future trans-mountain diversions.
September 17 marked the end of the comment period on the second draft of the water plan. Front Range water providers including Colorado Springs, Northern Colorado Water Conservation District, Denver Water, and Aurora demanded that the final version of the Colorado Water plan include a pledge to build more water storage rather than focus almost exclusively on water conservation to meet future municipal water demands. In addition, the providers requested that the
44 plan include a more focused, prioritized list of water projects to meet future demands, rather than an all-encompassing list of potential projects without any priority or schedule for moving them forward.
In response to the demands, 46 Colorado Water Conservation Board staffers were tasked with revising the plan to include a commitment for new reservoir storage of 130 billion gallons of water, the same amount of water proposed to be conserved by municipal entities over the next 20 to 30 years. CWCB staff also reduced the action item list in the plan from 200 projects to 36.
The Colorado Water Plan was approved by the Colorado Water Conservation Board and submitted to Governor Hickenlooper on November 19, 2015. The final plan promotes a list of projects identified during the drafting process, but does not give priority or funding to any of them. It does however establish measurable outcomes and timetables to meet general goals which include:
• Reducing the projected 2050 municipal and industrial water gap of 560,000 acre-feet by 2030. This reflects the gap first identified in the 2004 Statewide Water Supply Initiative. • Achieving 400,000 acre-feet of urban conservation by 2015. It also sets a goal of 75 percent of Colorado citizens living in communities that have incorporated water-saving land use concepts. • Developing voluntary temporary transfers of at least 50,000 acre-feet of agricultural water by 2030. • Attaining 400,000 acre-feet of additional storage by 2050. Much of that would come from projects already in the planning and development process. • Raising $100 million annually in additional revenue to fund water projects from 2020-2050, a total of $3.0 billion. • Covering 80 percent of locally prioritized rivers with stream management plans and 80 percent of critical watersheds with watershed protection plans by 2030.
After accepting the plan, Governor Hickenlooper downplayed the prospect of future trans- mountain diversion of water from the Western Slope to the Front Range. “What comes through loud and clear again and again in that water plan is that there ought to be ways to make sure that we have sufficient water to satisfy the growth along the Front Range without diverting the water across the mountains,” Hickenlooper said. We’ve addressed storage, conservation, you go down the list of all the approaches here, our goal from the very beginning was trying to make sure that where the water is, the water stays, but within the realm of the legal system that we operate in.”
A number of Front Range water providers want to leave the option open for more Western Slope water diversion to meet their increasing demands, as they see the continued “buy and dry” of agricultural lands in eastern Colorado as the “default solution.”
February 2016: The Colorado Water Conservation Board (CWCB), the Interbasin Compact Committee and the individual river basin committees are now turning their attention to implementation of the Colorado Water Plan. Jacob Bornstein, a program manager in CWCB’s water supply planning department told members of the Colorado Water Congress that the State is researching ways to provide $1.4 to $1.6 billion between now and 2050 to guarantee loans
45
amounting to $14 to $16 billion. However, adding the potential costs for environmental restoration and public education will likely bring State funding needs to $3, 0 billion by 2050. One option being explored is to seek voter approval for raising $100 million per year, or $1.0 billion by 2050.
Another issue being promoted by some water suppliers is encouragement of the State to support or promote water projects such as Denver Water’s Moffat project and Northern Water Conservation District’s Windy Gap project. The state has taken the position that it will not support a water project until all environmental studies have been completed. Mike Applegate with the Northern District stated that, “we really need to get some leadership here to stand up and say, “This is a good idea, let’s start doing this.” Dave Merritt, an engineer who sits on the Colorado River District Board of Directors, also recently said, “The governor needs to make a statement. Are you going to support it? Or are you not going to support it at this point.” When you are in a political leadership position, you are not an agency making a determination, you are the governor of the State of Colorado,” he added.
May 2016: I have attached an opinion piece written by Eric Kuhn, manager of the Colorado River District, with thoughtful observations on Colorado water planning, Colorado River Basin water and drought planning, conservation and efficient water use, and construction of additional water storage reservoirs.
June 2016: The Colorado Water Conservation Board has directed staff to research and develop plans for funding elements of the Colorado Water Plan. In response to the Board’s request, staff developed and participated in a Statewide Funding Committee. During the May 18-19 CWCB meeting, staff reported that “the Committee will continue to play a critical role in providing input towards the development of a realistic, sustainable funding plan that addresses the action items identified in Chapter 10 of the water plan”. Further, staff presented a draft policy to develop a long term funding plan for implementation of action items identified in the water plan.
July 2016: Colorado Water Conservation Board staff reported to the CWCB that measurable progress has been made on many of the critical actions identified in Chapter 10 of the Colorado Water Plan. “Basin roundtables are hard at work moving forward on action items and projects identified in the Basin Implementation Plans, even with challenges associated with severance tax funding. CWVB staff also reported that a long term funding plan for implementation of action items identified in the Water Plan will be presented to the Board at the September 2016 Board meeting.
The Denver Post published a joint opinion column by Jon Goldin-Dubois, president of Wester Resource Advocates, and Jim Lochhead on critical actions needed on the Colorado Water Plan.
August 2016: Jim Lochhead recently called for more attention to be devoted to development of a coordinated plan for meeting statewide water needs with an emphasis on “developing more flexible water management options that allow for greater sharing of the resources” and less emphasis on generating billions of dollars for unspecified water development projects. Mr. Lochhead’s opinion is being increasingly shared by other members of river basin committees who are disappointed in the lack of specific action items and state supported programs and projects to reduce the water supply gap.
46
September 2016: During a presentation made to the Colorado Legislature’s Interim Water Resources Review Committee, Bill Levine, budget director for the Department of Natural Resources, stated that the state’s mineral severance tax, which is used in part to fund water project loans, will drop significantly this year due to a state Supreme Court decision and depressed oil and gas prices. Revenues that totaled $271 million in 2014 dropped to $57 million this year. In addition, the state is looking at repaying potential $20 million to BP Petroleum and other companies based on the Supreme Court decision. This will significantly impact the plan for the state to provide funding of $100 million annually for water projects.
Also during the interim committee’s meeting, pollster Floyd Ciruli told the committee that state voters are supportive of spending money for planning, conservation, enhancement of river habitat, new water supplies and new storage projects. “The public is ready for implementation of water projects” he stressed.
October 2016: The Colorado Water Conservation Board has released a September 2016 update of the status of implementation of the Colorado Water Plan. A copy of the document is available upon request.
January 2017: The Colorado Water Conservation Board has requested that state legislators provide $5 million per year for the next five years to create stream protection plans throughout the state. The money would be used to develop watershed plans in accordance with the provisions of the Colorado Water Plan. The plans would be developed within the eight river basin “roundtable” forums that Colorado has relied on for addressing water challenges and providing input to the Water Plan.
James Eklund, Director of the Colorado Water Conservation Board, and Russ George, Chairman of the Colorado Water Conservation Board recently contributed a column to the Denver Post to update the status of the Colorado Water Plan.
March 2017: The Colorado Water Conservation Board (CWCB) is requesting that the General Assembly authorize Colorado’s Water Plan Funding to include $25 million for the implementation of the Funding Plan and $30 million for a Loan Guarantee Fund. CWCB pointed out that the $25 million Funding Plan of three years is less than 0.5 percent of the $20 billion needed for funding identified in Colorado’s Water Plan. The Funding Plan is comprised of the following:
• Water Supply Reserve Fund - $10 million Supplemental Funding • Watershed Restoration Program - $5 million • Water Plan Implementation Funding - $10 million • Creation of a Loan Guarantee Fund - $30 million
West Slope legislators sent a letter to Governor Hickenlooper warning that there is no more water available for diversion from the West Slope to the Front Range. A copy of the letter is attached hereto as Attachment 5.
47
Graywater Control Regulation
The Colorado Water Quality Control Division (Division) formed a stakeholder group to assist with development of graywater regulations. The Colorado legislature approved graywater use in 2014 and directed the Division to develop regulations to implement the legislation. The group has now had three meetings but has yet to release a draft of proposed regulations for public review and comment. A presentation made available by the Division is available at http://www.colorado.gov/cs/Satellite/CDPHE-WQ/CBON/125630013219.
May 2014: The Colorado Water Quality Control Division (Division) has temporarily suspended the stakeholder process for developing water quality regulations for graywater until the matter is reviewed by the Colorado Plumbing Board. It became apparent to the Division that the plumbing design of graywater systems is the foundation upon which the treatment and control measures will be added. July 2014: The Colorado Water Quality Control Division (Division) made a presentation to the Plumbing Board on April 23, 2014. On May 16, 2014, the Plumbing Board hosted a small graywater work group meeting that included Plumbing Board members, Division staff, graywater equipment vendors and others that requested to be present. The Plumbing Board informally indicated that they were waiting for Regulation 86 to be drafted prior to any formal Plumbing Board actions. However, the Plumbing Board agreed to provide informal feedback on the draft regulation 86.
Division staff also made a presentation to the Water Quality Control Commission (WQCC) on May 12, 2014. Division staff indicated that the Division may request a delay in the rule making process.
Another presentation was made by Division staff to the Water and Wastewater Facility Operators Certification Board. The Operators Board informally indicated that they would likely not require certified operators for single family treatment works or outdoor irrigation systems with a capacity less than 2,000 gallons per day. In addition, the Operators Board members agreed to provide informal feedback to the Division on the draft Regulation 86 soon.
Based on all of the meetings and presentations, the Division has drafted some amendments to Regulation 86 and is soliciting comments prior to July 25, 2014.
September 2014: In late June, the Colorado Water Quality Control Division (Division) sent a draft of the graywater regulations (Regulation 86) to 200 stakeholders for review and comment. Based on 171 comments received by the Division, the regulations were revised and referred out again for comment. The Division has now requested an April 2015 hearing date before the Water Quality Control Commission. The Division has reminded interested parties that graywater use is not allowed until 1) the WQCC adopts Regulation 86, 2)the Colorado Plumbing Board has adopted a Colorado Plumbing Code which allows for graywater plumbing, 3) the local city, city and county, or county has adopted an ordinance or resolution to create local graywater program, and 4) all other federal, state and local laws and requirements are satisfied.
48
January 2015: The Water Quality Control Division (Division) presented the draft Regulation 86 to the Water Quality Control Commission (WQCC) on December 8, 2014. The proposed draft regulation was accepted by the WQCC to begin the formal hearing process. Graywater treatment works and graywater use will not be allowed under the statute adopted in 2014 until:
• The WQCC adopts Regulation 86; • The Colorado Plumbing Board has adopted a Colorado Plumbing Code which allows for graywater plumbing; • The local city, city and county, or county has adopted an ordinance or resolution to create a local graywater program; and • All other federal, state and local laws and requirements are satisfied
August 2015: House Bill 13-1044 authorized the use of graywater in the state and required the Colorado Department of Health and Environment to adopt regulations governing its use. The legislation also encouraged the Colorado Plumbing Board to adopt International Plumbing Code (IPC) provisions concerning graywater. The Graywater Control Regulation became effective June 30, 2015, and the Plumbing Board is pursuing stakeholder input and public comment about adopting plumbing code revisions.
The Plumbing Board has established a stakeholder group to consider amendments to the plumbing code for graywater use. Recently, the board decided to not allow toilet flushing as an approved use for graywater, at least not at this time. Some stakeholders, including Denver Water and the City of Denver, are promoting the use of graywater indoors, particularly for toilet flushing. A follow up meeting to further consider stakeholder comments is scheduled for August 25.
September 2015: A hearing before the Colorado Water Quality Control Commission on revisions to Regulation 86, the graywater regulation, is scheduled for November 9, 2015. The proposed revisions allow indoor use of graywater for toilet flushing, but such use will still require adoption of amendments to the Colorado Plumbing Code by the Colorado Plumbing Board. The Plumbing Board was considering draft rules that did not include indoor graywater provisions, but during its last meeting agreed to consider a revised proposal that would include indoor use. The Colorado Department of Public Health and Environment is very concerned about potential health issues that could arise from indoor use systems, and will want to see any proposed standards developed in a manner that is protective of public health. The next meeting of the board will be later this year.
January 2016: The National Academies of Sciences, Engineering, and Medicine has issued a new report warning that additional guidelines and research is needed on the risk to public health from using stormwater and graywater as alternative water sources. The report concludes that there is currently limited information on the costs, benefits, risks, and regulation of graywater and stormwater projects and addition research and changes in infrastructure will be necessary to take full advantage of their potential. More research and data on stormwater and graywater quality are necessary to assess the risks under various human exposures, particularly on the types and concentrations of pathogens that are likely to occur, the report says. Additional information is also needed on the organic chemicals in stormwater and their consequences for various uses. If water conservation is the primary objective, alternative strategies like designing water-efficient landscapes to reduce or eliminate irrigation should first be examined and would provide much
49
larger reductions in water demand in arid regions. The committee recommended that the EPA, a collaboration of states, or a collaboration of water organizations working with EPA develop risk- based guidelines to improve safety, reduce spending on unnecessary treatment, and assist communities that lack an existing regulatory framework for on-site water supplies.
May 2016: The Denver City Council passed an ordinance allowing graywater usage within the City. Colorado state law permits graywater use as long as it conforms to Regulation 86, applicable state plumbing standards, and is approved by the multi-purpose government that controls the plumbing code. Denver’s ordinance was supported by Denver Water and allows for both outdoor use and indoor use for toilet flushing. The ordinance requires that a permit be obtained by property owners for graywater use, and it impose some very strict requirements which, in most cases, makes graywater use cost prohibitive.
Chatfield Reservoir Reallocation Study
The Colorado Water Conservation Board and U.S. Army Corps of Engineers have determined that it is feasible to reallocate 20,600 acre feet of storage space in Chatfield Reservoir from flood control to water supply. Water users that are interested in using the storage space determined amongst themselves how the 20,600 acre feet would be divided. Denver Water is not pursuing use of any of the potentially available storage space but is working to ensure that its current storage space is not detrimentally affected.
The Colorado Water Conservation Board (CWCB) approved the Chatfield proposal during its meeting on January 25, 2005. The water allocation agreement reached by the parties together with the CWCB’s endorsement will enable the Chatfield reallocation process to move forward with an environmental assessment or environmental impact statement.
Project sponsors and Colorado Water Conservation Board (CWCB) staff are in the process of completing the Feasibility Report/Environmental Impact Statement (FR/EIS) for the Chatfield Reservoir Reallocation project. It is anticipated that the Corps of Engineers will issue a Record of Decision in mid-2009. It is proposed that CWCB will own the additional storage space if the project reaches fruition. The project sponsors will continue to own and control the water rights that will utilize the expanded storage space.
CWCB staff is working with a large coalition of interested stakeholders to complete a Feasibility Report and Environmental Impact Study related to the proposed reallocation of existing storage space in Chatfield Reservoir to gain additional water supply along the Front Range. Coordination among affected DNR agencies will continue to be paramount as key elements of the project unfold. Two related studies, jointly sponsored by the CWCB and State Parks, are underway to investigate: 1) Socio-economic impacts due to potential reallocation of storage space, and 2) Feasibility of modifying/relocating recreation facilities based on new Corps guidance with respect to the recalculated 10-year flood pool elevation. In addition, the project stakeholders have collectively hired a public outreach firm to assist with outreach activities to enhance planned activities by the Corps to meet NEPA requirements.
50
The U.S. Army Corps of Engineers (Corps) conducted a key meeting, known as an Alternatives Formulation Briefing (AFB), on May 14, 2009 at its Tri-Lakes project office in Littleton. Corps personnel from the Headquarters (Washington, D.C.), Division (Portland, Oregon), and District (Omaha, Nebraska) offices participated to discuss high level policy issues as well as more specific tasks needing attention prior to public release of a draft feasibility report and environmental impact statement (FR/EIS). The CWCB and a cadre of water providers and other study team members attended as well to observe the meeting and to provide technical support as necessary. The Corps received two letters from the U.S. Environmental Protection Agency regarding comments on the preliminary FR/EIS, which precipitated the need for the two federal agencies to discuss and resolve several important issues raised in the letters. In related news, several study team member from Colorado visited with Congressional Delegations members and staff from Corps Headquarters in Washington, D.C. on June 25th to discuss appropriations, study status, and next steps.
July 2011: The Draft Feasibility Report and Environmental Impact Statement (FR/EIS) for the Chatfield Reservoir Reallocation Project has now been printed by the U.S. Army Corps of Engineers, Omaha District, for final review by the Agency Technical Review Team, the Division Office in Portland, Oregon, and the Headquarters Office in Washington, D.C. Depending on the type and quantity of comments received from the review process, the Draft FR/EIS may be released to the public as early as August of this year. Several outstanding topics need to be discussed and resolved over the coming months in order to make sure that remaining environmental and recreation concerns from the State and other stakeholders are appropriately addressed. (Tom Browning - CWCB).
July 2012: The Draft Integrated Feasibility Report and Environmental Impact Statement (IFR/EIS) has been released for public comment by the U.S. Army Corps of Engineers (Corps). Three public involvement meetings were held by the Corps on June 25, 26 and 27, one of which was located at Dakota Ridge High School. Following the meetings, in response to public comments the Corps extended the public comment period on IFR/EIS to September 6, 2012. A copy of the abstract from the IFR/EIS is available upon request, and the entire 500 plus page document is available at www.chatfieldstudy.org. In addition, copies of Denver Post, Columbine Courier and Westword articles pertaining to the proposal are available upon request.
August 2012: The Draft Environmental Impact Statement continues to generate considerable media attention as the Audubon Society and other activists have become more vocal in their opposition to the project. Most water utilities and many environmental groups support the project as being a reasonable, environmentally harmless way to increase water storage for a diverse group of municipal and agricultural water suppliers and users. However, others have expressed concern with habitat losses and reduced flows in the South Platte River below Chatfield.
September 2012: The comment period for the Chatfield Reservoir Storage reallocation Project has expired and the U.S. Army Corps of Engineers (AC)E) will now review the comments and prepare a Record of Decision and, if applicable, a permit to proceed with the proceed.
February 2013: Some of the participants in the Chatfield Reservoir Reallocation Project have abandoned their rights to acquire reservoir storage space. The Colorado Water Conservation Board has stepped forward to purchase these “orphan shares.” At its November 2011 meeting, the
51
CWCB approved a $13 million authorization to purchase orphan allotments (Orphan Shares) of Project storage space that were anticipated to revert back to the CWCB. The General Assembly approved the CWCB Projects Bill, including $13 million Chatfield funding, during the special session last year. Orphan Shares from Colorado Parks & Wildlife and Perry Park Country Club were included in the transfer agreement.
CWCB staff recently notified the Board that additional orphan shares may revert back to the CWCB. The best estimate currently available is that up to $49 million in orphan shares (roughly 5,500 acre-feet of storage, or one-fourth of the Project reallocation storage space) could revert back to the State.
In February 2013 the CWCB agreed to allocate $49.0 million for purchase of the additional orphan shares with the intention of selling them to a water provider when the Project is permitted and moves forward.
October 2013: The comment period for the final Environmental Impact Study for the Chatfield Reservoir Reallocation Project ended in early ended in early September. The Army Corps of Engineers will now review and respond to comments and issue a record of decision in early 2014.
February 2014: The Final Feasibility Report and Environmental Impact Statement (FR/EIS) is complete and a Record of Decision (ROD) is expected to be issued by the federal government in the very near future. The Fish, Wildlife and Recreation Mitigation Plan has been completed, approved and released by the Colorado Parks and Wildlife Commission on January 9, 2014. The Plan addresses impacts in reservoir along with upstream and downstream impacts. The in reservoir impacts are addressed through an operations plan, fluctuation zone mitigation, water quality adaptive management and an environmental pool. The upstream and downstream impacts are addressed through habitat restoration and flow control measures. A copy of the Plan is available upon request.
June 2014: The U.S. Army Corps of Engineers (Corps) has issued a Record of Decision approving the Chatfield Reservoir Storage Reallocation Project. The recommendation, sent by Steven Stockton, Director of Civil Works, to the Assistant Secretary of the Army (Civil Works) states:
The Omaha District Commander recommends implementation of the Selected Plan, Alternative 3, which would reallocate 20,600 acre-feet of exclusive flood storage to joint flood control/conservation storage to provide an average annual yield of 8,539 acre-feet per year for the purpose of municipal and industrial water supply and other purposes including agriculture, environmental restoration, and recreation and fishery habitat protection and enhancement. At FY 14 price levels, the estimated fiscal first cost to implement the reallocation project is $124,152,754, which includes an estimated $16,285,392 payment to the U.S. Treasury for the cost of storage. I concur with the findings of the district commander and his recommendation. I recommend you determine that the work proposed to be performed by the Colorado Department of Natural Resources is integral to the reallocation project: approve the Final FR/EIS with Addendum No 1, and sign the Record of Decision. Upon completion of those actions, the Corps will complete negotiations and submit for your approval an agreement with CDNR for implementation of the reallocated water storage, recreation modifications and compensatory mitigation features.
52
July 2014: According to ACOE project manager Gwyn Jarrett, it could be three to four years before work is underway and two to three years after that before it is completed. According to Ms. Jarrett, “most of the work will be done in the offseason, but people can expect that certain portions of the park could be closed at times. Part of the construction will include improving some of the amenities at the park such as new recreation buildings, picnic tables, beach areas and bathhouses.”
October 2014: The U.S. Army Corps of Engineers approved the Chatfield Reservoir Expansion Project and is now working with the state and project participants to contract for design and construction of mitigation elements called for in the permit. The state estimates that it will take three years to get all of the contracts in place, get detailed plans in place and complete the early mitigation work. Unfortunately, the project may also be delayed due to a lawsuit filed by the Audubon Society which is claiming that there are less environmentally damaging ways to meet the project purpose and need, and therefore the project cannot be permitted.
September 2015: The Colorado Water Conservation Board (CWCB) has transferred 1,000 acre feet of storage space in the project to Colorado Parks and Wildlife (CPW). A loan in the amount of $7,000,000 has been granted by CWCB to CPW to pay for the storage space. The loan will be paid back from the Wildlife Cash Fund. The CWCB acquired the storage rights when other project participants discontinued participation in the project.
May 2016: The Audubon Society of Greater Denver (Audubon) filed a lawsuit (Audubon Society of Greater Denver v. United States Army Corps of Engineers, et. al. 14CV02749, D. Colo.) opposing the issuance of a federal 404 permit for the Chatfield Reallocation Project. Audubon raises several challenges in its opening brief including: 1) that the Corps violated the Clean Water Act by failing to select the least damaging alternative for the project; 2) that the Corps violated NEPA because it failed to evaluate reasonable alternatives; and 3) that the Corps violated NEPA because it failed to foster informed decision making and public participation. The Colorado Department of Natural Resources disagrees and has intervened in support of the Corps. The Department worked closely with the Corps as it developed the project and EIS over nearly a decade. The Corps’ Answer Brief is due May 25 and the Intervenors’ brief in support of the Corps is due June 6. Audubon then has 15 days to file a reply brief.
July 2016: The Audubon Society filed its opening brief in which it claims: 1) that the Corps of Engineers violated the Clean Water Act by failing to select the least damaging alternative for the project; 2) that the Corps violated NEPA because it failed to evaluate reasonable alternatives:, and 3) that the Corps violated NEPA because it failed to foster informed decision making and public participation. The Colorado Department of Natural Resources disagreed with the claims and intervened in support of the Corps. The parties have requested oral argument and are awaiting a court order granting oral argument.
January 2017: Despite the lawsuit filed by the Audubon Society, The Chatfield Storage Reallocation Project is moving forward. Eight water provider entities have formed a new non- profit organization called the Chatfield Reservoir Mitigation Company (CRMC). The board of the organization is selecting a program management team and has signed an agreement with CDM Smith and Leonard Rice Engineers to being work on the design process to implement the approved
53
and required project components. The U.S. Army Corps of Engineers is currently reviewing the preliminary designs.
March 2017: Dominion Water and Sanitation District which supplies water to the Sterling Ranch Development is acquiring 500 acre feet of available storage space in Chatfield Reservoir. The cost is $7,000 per acre foot for the opportunity to store whatever water is separately supplied by Dominion.
The Chatfield Reservoir Mitigation Company (CRMC) has been formed for the purpose of designing and constructing the mitigation projects called for in the permits for the Chatfield Storage Reallocation Project. CRMC anticipates having final design plans submitted to the U.S. Army Corps of Engineers for both the recreation modification and the on-sit environmental mitigation along Plum Creek by June 1, 2017. The final design plans for on- site mitigation work along the South Platte River and Marcy Gulch are anticipated to be completed by August 2017. Final USACE review of the design plans is scheduled for late summer of 2017.
Statewide Water Supply Initiative
The Colorado Water Conservation Board completed a Statewide Water Supply Initiative in 2010 (SWSI 2010). At that time, it was determined that the plan would be updated in 2016. It is now thought that the plan will provide important information for development of the statewide water supply plan order by Governor Hickenlooper to be developed by the end of 2105. An outline for SWSI 2016 has been developed to accommodate the timeline requested by the governor. A copy of the outline with some informative background information is available upon request.
March 2014: To support the argument that a large water storage project is not necessary to meet various water basin’s water supply gaps, the Colorado River District is now claiming that water demand assumptions and the amount of water available from currently planned projects and additional water conservation efforts proposed in the 2010 SWSI study are inaccurate and, therefore, the gaps are not as large as proposed. This new argument will likely cause much discussion and dissention during the update of the SWSI study in 2016, as well as the development of the Colorado Water Plan.
May 2014: As reported in March 2014, the Colorado River District is asserting that the water demand and supply calculations used in the 2010 SWSI report are inaccurate, and when corrected the result is the elimination or extreme reduction in the supply gap for the Front Range. A summary of the River District’s argument is available upon request.
February 2016: With the completion of the Colorado Water Plan, the river basin committees have been tasked to work on a $1.0 million update to the 2010 Statewide Water Supply Initiative (SWSI). SWSI is a more technical document that the Colorado Water Plan, which was oriented toward policy and process. The 2016 SWSI update is anticipated to be completed prior to year- end.
54
April 2016: The Colorado Water Conservation Board approved funding in the amount of $1.0 million for the 2016 update of the Statewide Water Supply Initiative (SWSI). The update will expand on the 2010 study to include strategies to deal with scenario planning, climate change and hydrologic variability. Gaps in water supply for agriculture, environmental and wildlife will be addressed. It will also incorporate basin implementation plans and the economic value of water. SWSI will continue to serve as the technical platform for statewide planning and work in conjunction with future updates of the Basin Implementation Plans and the Colorado Water Plan. The Scope of Work for SWSI can be found at www.cwcb.state.co.us.
March 2017: In February 2017, the Colorado Water Conservation Board (CWCB) Project Management Team, Consultant Team and the Technical Advisory Groups (TAGs) began developing the methodologies which will build upon previous efforts study efforts and expand to include scenario planning, climate change, conservation impacts and agricultural and non-consumptive gaps. Once the refined methodologies are finalized, data collection, analysis and documentation will take place throughout the remainder of 2017. The updated SWSI analysis is scheduled to be finalized by December 2017.
Federal Legislation, Regulation, and Litigation
Election – Cabinet Appointments
The Senate confirmation hearing for Scott Pruitt, President-elect Donald Trump’s nominee to head the EPA, is scheduled for January 18. Environmental organizations are running ads and lobbying both Democrat and Republican senators urging them to oppose the nomination. Pruitt is currently attorney general for Oklahoma and is suing the EPA over its greenhouse gas and other rules. It is expected that Pruitt will be confirmed since Republicans hold a 52-48 majority and rules adopted by the Democratic majority in 2013 eliminated the filibuster for executive branch nominees.
Senator Jeff Sessions (R-AL) has been nominated by President-elect Trump to be attorney general. “Sessions will oversee the incoming administration’s litigation strategy which will almost certainly seek to withdraw already-issued Obama administration rules, such as the Clean Power Plan and the Water of the U.S. Rule, form ongoing judicial review.” [InsideEPA.com]
Legislation
The First Session of the 115th Congress convened on January 3, 2017. Bills of interest will be tracked as they are introduced and move through the legislative process.
55
2017 Budget and Appropriations
President Obama’s fiscal year 2017 budget released on February 9 call on Congress to increase EPA’s budget from $8.14 billion in 2016 to $8.27 billion in 2017. The budget proposal calls for offsetting spending increases with a $422 million cut to the agency’s clean water state revolving fund (CWSRF). It proposes spending of $1.02 billion for the drinking water state revolving fund (DRSRF), a $166 million cut from last year’s $1.186 billion request, but greater than Congress’ $863 million appropriation for fiscal 2016. The CWSRF would receive $979.5 million under the president’s budget, a 12 percent drop from the $1.116 billion the administration asked for last year and only three-quarters of what Congress set aside in the most recent spending bill.
Senator James Inhofe (R-OK), chairman of the Senate Environment and Public Works Committee that oversees EPA stated that the proposed budget is “already being disregarded” in the GOP Congress. Neither the House nor the Senate will even call on White House Office of Management and Budget Director Shaun Donovan to testify on the budget.
May 2016: Despite the lack of action on adoption of a budget, the Senate has approved the first of 12 appropriation bills - the energy and water spending bill - that primarily funds Energy Department and Army Corps of Engineers programs. The funding levels for each bill will not change substantially compared to FY 16 funding levels because an overall FY17 discretionary spending level of $1.07 trillion was already agreed to in the two-year budget deal signed in December of 2015.
June 2016: Both House and Senate Appropriations Committees are considering bills in early June to fund the U.S EPA, the Interior Department and Forest Service. The House bill retains funding near the 2016 appropriation of $32 billion, $1 billion below the White House request. EPA would receive $7.98 billion, about two percent less than the administration’s request for $8.26 billion. However, the agency’s regulatory program appropriation would be cut by $43 million from this year’s level and $187 million below the administration’s proposal. The bill also includes a number of policy riders that would block proposed regulations including the Clean Power Plant rule and the Waters of the United States rule. The riders are unacceptable to Democrats and if passed would result in a veto by President Obama. The Senate is expected to consider a much cleaner bill, but if passed will eventually have to be reconciled with the House bill in a limited amount of time before the chambers recess for the summer and election campaigns. At this time it does not appear likely that Congress will be able to agree on a bill and will ultimately have to adopt a continuing appropriation or an omnibus spending bill later this year.
July 2016: The Senate Appropriations Committee approved the $32.7 billion bill to fund U.S. EPA, the Interior Department, and the Forest Service. While the Senate bill is not as controversial and partisan as the House appropriation bill, Senate Democrats have vowed to block a floor vote. The House bill contains many policy riders including preventing implementation of the Water of the United States Rule. The bill is certain to be vetoed if approved in its present form. As stated above, there is a very good chance that Congress will be forced to adopt a continuing appropriation or an omnibus spending bill after the summer recess.
56
August 2016: Congress left for its summer recess on July 15 and will not return until September 5. Work on the FY 2017 appropriations bills was not completed by the Senate leaving little time for action before the beginning of the fiscal year on October 1. Prior to the recess the House passed its Department of Interior, EPA, related agencies bill following debate over 130 amendments that were opposed by Democrats. The bill also proposes steep cuts to the Clean Water State Revolving Fund Program of $400 million while proposing a slight increase of $100 million for the Drinking Water Revolving Fund.
September 2016: House and Senate legislators continue to work toward a stopgap funding measure to fund the government beyond the end of the fiscal year on September 30. The House is considering a measure to provide funding at current levels through mid-December after which a series of bills, known as minibuses, each containing three or four of the annual appropriations bills in the lame-duck session, with a goal of having all 12 spending bills becoming law. Senate Republicans, however, have said they will begin moving a continuing resolution by mid- September that would run until December 9 and then wrap up spending in the lame duck.
October 2016: Congress beat the September 30 end of fiscal year 2016 deadline by passing a continuing resolution (CR) which keeps the Federal Government funded through December 9. Both chambers will return on November 15 for a post-election lame duck session to complete funding for the 2017 FY. The CR includes $1.1 billion in funding to combat the Zika Virus and $500 million for Louisiana and other states coping with recent severe flooding. It does not, however, include funding for aid to Flint, Michigan. That issue resulted in a large dispute when Democrats demanded that aid to Flint be included in the CR. As a compromise, the Flint aid package was included in the Water Resource Development Act (WRDA) (S. 2848 and H.R. 5303) and was subsequently passed by both chambers. Reconciliation of the two bills will be taken up during the lame duck session.
January 2017: Prior to adjourning in December, Congress passed a Continuing Resolution (CR) to fund government through April 28, thus narrowly avoiding a government shutdown The CR maintains Fiscal Year 2017 federal spending at Fiscal Year 2016 levels through April, postponing major appropriations decision-making until the new Congress and Administration are in place.
H.R. 5 Regulatory Accountability Act
This bill incorporates a series of reform measures the House passed in the 114th Congress, and has the backing of industry groups that have fought EPA rules they describe as unlawfully strict or otherwise overreaching. Specifically, it would add new mandates for agencies to choose the least burdensome option for accomplishing statutory goals; create new requirements for regulators to give advance notice of rulemakings in development; broaden requirements for reviewing proposed rules’ effects on small businesses; automatically stay some “major” rules when they are challenged in court; and repeal two landmark Supreme Court decisions that mandated deference to agencies when they interpret “ambiguous” statutory or regulatory text.
The bill was approved by the House on a 238-183 vote on January 11.
57
H.R. 26 and S. 21 Regulation From the Executive in Need of Scrutiny Act. (REINS Act)
The REINS Act would require congressional approval of federal regulations with an estimated annual economic impact of more than $100 million. It would also require each federal agency promulgating a new rule to identify and repeal an existing rule to offset annual costs and would create a process for Congress to review all rules currently in effect over a 10-year period.
The bill passed the House on January 5 on a largely party-line vote of 237-187. The Senate considering similar legislation (S.21)
H.R. 465 Water Quality Improvement Act of 2017
This bill would allow cities to address their Clean Water Act wastewater and stormwater requirements on a pollution priority basis rather than all at once (integrated planning).
Status: Referred to the Transportation and Infrastructure Committee’s Subcommittee on Water Resources and Environment
H.R. 469 and S.119 The Sunshine for Regulatory Decrees and Settlements Act of 2017
These bills would require agencies to publicly post and report to Congress any information on lawsuits, consent decrees or settlement agreements. They also prohibit same-day filing of complaints and pre-negotiated settlements. Sue-and-settle tactics are used solely to hide an agency’s regulatory ambitions from the American people until it is too late,” stated Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa).
H.R. 861 To Terminate the Environmental Protection Agency
This bill would abolish the U.S. Environmental Protection Agency and move the agency’s duties to states.
Status: Referred to the Energy and Commerce Committee, Agriculture Committee, Transportation and Infrastructure Committee, and Science, Space and Technology Committee.
H.R. 988 Searching for and Cutting Regulations That Are Unnecessarily Burdensome (SCRUB) Act
This bill would set up a five-year commission to review rules ripe for repeal. The goal is to reduce regulations in the Federal Register by 15 percent.
58
Status: Approved by the Oversight and Government Reform Committee
H.R. 1004 Regulatory Integrity Act
This bill would require agencies to post an online record of rules and their status. It would also force agencies to disclose every communication about rules and would prohibit them from promoting the rules on social media. Posts informing the public of the “substance” or a rule would be permitted.
Status: Approved by the Oversight and Government Reform Committee
H.R. 1009 Office of Information and Regulatory Affairs (OIRA) Insight, Reform and Accountability Act.
The Office of Information and Regulatory Affairs (OIRA). An agency in the White House Office of Management and Budget, reviews significant federal regulations. H.R. 1009 would put under congressional oversight rather than the executive branch. It would also require a report on proposed rules and retrospective review to eliminate outdated regulation.
Status: Approved by the Oversight and Government Reform Committee
H.R. 1068 Safe Drinking Water Amendments of 2017
This bill would require U.S. EPA to hasten its review of lead and copper limits in drinking water. It would require EPA to institute many of the changes the agency is already considering in its review of the Lead and Copper Rule which were outlined in a white paper released by EPA in October 2016. It would require utilities to review corrosion control treatments in water any time source water or treatment is changed. It would also require the EPA to ensure water utilities use sampling methods for testing lead in households shown to be most accurate. Utilities would also be required to test lead and copper levels at schools, something the Lead and Copper Rule does not currently do.
Status: Referred to the Energy and Commerce Committee’s Subcommittee on Environment.
59
Federal Regulation
Regulatory Reform
President Trump signed an executive order (EO) (Attachment 6) on January 30, 2017 directing EPA and other regulatory agencies to eliminate two existing rules for every one the enact, while also setting on overall “budget” for new regulatory costs each year. “Unless prohibited by law, whenever an executive department or agency publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed,” the order states. Industry and environmentalist attorneys say the EO as written is unclear on whether it is meant to apply to rules EPA is required by law to issue, but regardless of the EO’s intent, a statutory mandate would take precedence over the EO.
The president followed up with the issuance of another EO (Attachment 7) on February 24, 2017 directing each federal agency to designate a Regulatory Reform Officer to “oversee the implementation of regulatory reform initiatives” and to form a Regulatory Reform Task Force that will work to identify which existing rules should be repealed, replaced or modified.
Clean Water Act - Waters of the United States (WOTUS) Rule
The joint EPA and Army Corps of Engineers Waters of the United States (WOTUS) Rule currently stayed from implementation under an appellate court order -- aims to resolve long-running uncertainty about the water law's reach, though critics challenging the rule in court and Congress claim it exceeds the agencies' authority.
The statutory goal of the Clean Water Act (CWA) is to restore and maintain the chemical, physical, and biological integrity of the nation’s waters, and protect against unlawful discharges or pollutants or dredge or fill material into navigable waters, which the law describes in section 502 as waters of the United States, and the territorial seas. But Congress never defined the term “waters of the United States,” leaving EPA and the Corps to define it through regulations -- which have repeatedly been the subject of federal court challenges. For example, the Corps in its implementing CWA regulations defined waters of the United States to include “waters such as intrastate lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes, wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate or foreign commerce . . .”
In the earliest Supreme Court ruling to examine the scope of the water law, the high court in a unanimous ruling issued 1985 in United States v. Riverside Bayview Homes held that wetlands adjacent to navigable waters are jurisdictional, finding that the protection of water quality and aquatic ecosystems under the CWA “inseparably bound up with” jurisdictional waters.
60
But the Supreme Court in a 5-4 ruling in 2001 in Solid Waste Agency of Northern Cook County (SWANCC), Petitioner v. United States Army Corps of Engineers, et al., concluded that the rule was not “fairly supported” by the CWA. The justices' decision effectively barred regulators from citing the presence of migratory birds as the sole basis for asserting jurisdiction over wholly intrastate waters.
The SWANCC ruling focused more attention on CWA jurisdiction issues generally, and on tributaries to jurisdictional waters and “adjacent” wetlands, which EPA and the Corps said in 2003 guidance remain subject to the CWA only if they can be shown to be adjacent to or flow into traditionally navigable waters. That guidance said that regulators “should continue to assert jurisdiction over traditional navigable waters (and adjacent wetlands) and, generally speaking, their tributary systems (and adjacent wetlands),” but supported jurisdictional and permitting decisions on a case-by-case basis.
Competing Tests
In 2006, the Supreme Court in Rapanos et ux, et al., v. United States, the high court in a 4-4-1 decision remanded to the U.S. Court of Appeals for the 6th Circuit a challenge by developers to determine whether the wetlands at issue were jurisdictional under the water law.
But the justices did not agree on the appropriate legal test for determining whether wetlands should be protected, and did not issue a binding majority opinion on that issue. Instead, they created two competing tests for determining CWA jurisdiction that have left major uncertainty and prompted the calls for EPA and the Corps' rulemaking.
Four justices -- Chief Justice John Roberts and associate justices Samuel Alito, Antonin Scalia and Clarence Thomas – wrote in a plurality opinion authored by Scalia that the CWA extends only to waters that are "relatively permanent, standing or continuously flowing" or to wetlands that are immediately adjacent to such waters. Four other justices -- Ruth Bader Ginsburg, Stephen Breyer, David Souter and John Paul Stevens -- said in a dissenting opinion written by Stevens that Congress' intent in crafting the CWA was far more comprehensive and aimed at protecting not only wetlands adjacent to navigable waters themselves, but also to wetlands adjacent to tributaries of navigable waters.
Justice Anthony Kennedy wrote an opinion concurring with Scalia's decision to vacate and remand, but for different reasons. Like Scalia, Kennedy says there should be limits on CWA protections for remote waterbodies, but said waterbodies with a "significant nexus" to navigable waters should still be protected. Kennedy says waterbodies can have this nexus if they significantly affect the integrity of navigable waters.
Observers said at the time that Kennedy's opinion would likely carry the most weight in the lower courts, due in part to the Supreme Court's ruling issued in 1977 in Marks v. Whitney, in which the justices unanimously held that when a court is split in a plurality, those members who concur "on the narrowest grounds" have the controlling opinion.
61
Regulatory Response
The Rapanos ruling drove calls for EPA and the Corps to draft new regulations that clearly state what is and is not jurisdictional under the CWA and resolve confusion left by the justices' competing tests. The George W. Bush EPA in 2008 guidance established its policy response to the ruling, which asserted jurisdiction over TNWs, wetlands adjacent to TNWs, tributaries that are "relatively permanent, standing or continuously flowing" or to wetlands that are immediately adjacent to such waters.
The guidance said that other tributaries and non-adjacent wetlands would be evaluated on a case- by-case basis for determination as to whether they shared a significant nexus to TNWs.
In 2011, EPA and the Corps then released a draft guidance for public comment that advanced a broad interpretation of Kennedy's opinion in Rapanos. But the draft guide drew significant criticisms from industry, states and many GOP lawmakers, who charged that it does not provide enough certainty on when waters are regulated and would extend the law's reach beyond current policy and was never finalized.
After President Obama took office, EPA and the Corps then pursued a formal rulemaking to clarify the scope of the water law, receiving extensive public comment on the plan. EPA and the Corps released the proposed rule and accompanying fact sheet on March 25, stating that the plan generally finds all tributaries of traditional navigable waters and interstate waters, and adjacent water bodies, are automatically jurisdictional because they share a “significant nexus” to navigable water, a legal term stemming from the divided 2006 Supreme Court ruling in Rapanos V. United States.
In May 2014, Western Governors expressed concern about the WOTUS rule to the EPA and Corps. A letter signed by Governor John Hickenlooper, Western Governors Association chairman, asserts that the rule was developed without sufficient consultation with states and could impinge on state authority. The letter proffers that “as co-regulators of water resources, states should be fully consulted and engaged in any process that may affect the management of their waters.” However, “the conversations to date have not been sufficiently detailed to constitute substantive consultation” and that “Western Governors strongly urge both EPA and the Corps to engage states as authentic partners in the management of Western water.”
The Western States Water Council representing 18 western governors released a supplemental letter to the EPA and Corps with additional but similar concerns as those expressed in the governors’ letter.
Also in May 2014, more than 200 members of the House of Representatives, including 19 Democrats, sent a letter arguing that the regulatory proposal oversteps limits on federal jurisdiction set by the Supreme Court in 2001 and 2006, as well as Congressional intent. “Contrary to your agencies’ claims, this would directly contradict prior U.S. Supreme Court decision, which imposed limits on the extent of federal Clean Water Act authority”, they wrote. “Although your agencies have maintained that the rule is narrow and clarifies CWA jurisdiction, it in fact aggressively
62
expands federal authority under the CWA while bypassing Congress and creating unnecessary ambiguity.”
The House Committee on Small Business held a hearing on May 29 on the CWA Jurisdiction Rule. During the hearing several committee members blasted the potential economic impact of the proposed rule. Rep. Scott Tipton (R-Colo.) called the proposal “the greatest water grab that we’ve seen by the federal government in the history of the United States.” Rep. Chris Collins (R-N.Y.) said that farmers are “scared to death” of the rule. And Rep. Kurt Schrader (D-Ore.) deemed the proposal a “vast expansion” of federal power. Republican members of the committee sent a letter to top officials at the EPA and the Corps calling for the agencies to withdraw the proposed rule, complete an analysis of its impact on small businesses as required by the Regulatory Flexibility Act and then resubmit the rule.
In June 2014, EPA and the U.S. Army Corps of Engineers extended the comment period on the Clean Water Act Jurisdiction Rule from July 21 to October 20.
The House Science, Space and Technology Committee held a hearing in July 2014 on the impacts of the WOTUS rule. The hearing, entitled “Navigating the Clean Water Act: Is Water Wet?” provided members the opportunity to ask EPA Deputy Administrator Robert Perciasepe questions about the rule. Perciasepe was the only witness at the hearing and members grilled him about specific issues in their districts. During the opening statement, Chairman Lamar Smith (R-TX) showed a picture of all intermittent and ephemeral streams in the Western United States that would be regulated under the proposed rule. He noted that “EPA’s rule is so vague that it does little more than extend an open invitation to trial lawyers and government drones.” Perciasepe said EPA’s rulemaking would actually reduce the scope of waters protected under the Clean Water Act and would not assert jurisdiction over waters not currently under federal protection. Many members of the Committee strongly disagreed with his assessment.
Rep. Chris Collins (R-NY) demanded EPA withdraw the rule. “What you’ve shown is a disregard for listening. You don’t listen,” Collins said. “Congress doesn’t trust you, the Farm Bureau doesn’t trust you, counties don’t trust you, and the public doesn’t trust you.”
Chairman Smith and other committee members also questioned Perciasepe on EPA proposing the Rule before the completion of the connectivity study meant to justify the measure, which is under review by the EPA Science Advisory Board (SAB). Even though EPA has promised not to finalize the rule until after the report is done, Smith blasted Perciasepe for preventing direct communication between committee members and the SAB.
August 2014: Key Senate Democrats are joining critics who have asked EPA to revise its Waters of The United States (WOTUS) Rule. A letter signed by 12 Democrats, including key leaders as well as several senators who are facing tough re-election races in farm states, is the most direct criticism yet to be levied at the proposed rule by congressional Democrats who have largely been supportive. The senators’ letter seeks more clarity in two areas of the rule: a specific definition of what constitutes a waterbody’s “bed and bank,” which they say “will significantly help resolve confusion as to which agricultural features can be classified as tributaries,” and a detailed guide to when ditches located in floodplains are jurisdictional. “In a guidance document on the EPA
63 website, it states that the agency intends to include ditches collecting runoff or drainage from crop fields as upland ditches, However, the rule itself mentions only “ditches that are excavated wholly in uplands, drain only uplands, and have less than perennial flow.” Many producers are concerned because their farms contain fields in floodplains”, and thus are not wholly in uplands.
Agricultural groups and state and local regulators are also increasingly arguing that if the administration finalizes the rule as proposed it would further confuse the already uncertain landscape of CWA jurisdiction, even when, unlike many industry opponents, they agree with the rule’s goals.
September 2014: The EPA is now claiming that the WOTUS rule will benefit regulated entities by reducing their liability for citizen suits filed under the Clean Water Act because it would eliminate an existing “gray area” regarding what types of waters are jurisdictional. Yet, as referenced above, citizen suits are already being filed and the rule has not even been adopted. The EPAs latest defense of the rule is contained in a document titled Questions and Answers About Waters of the U.S. Proposal.
Some members of a Science Advisory Board (SAB) panel are urging EPA to expand the WOTUS rule oversight to indicate that groundwater in many cases should be considered jurisdictional and subject to regulation, a plan that if adopted would undoubtedly increase opposition to the rule. One member of the Board stated that the “exclusion of groundwater is a concern, and should be recognized as such,” adding that groundwater, or subsurface drainage systems, is an important pathway for some nutrients and pollutants that may end up through nonpoint sources in downstream traditionally navigable waters, or those considered traditionally jurisdictional. Apparently, the fact that EPAs authority under the CWA generally prohibits regulation of groundwater means little to these folks.
EPA’s local government advisors are urging the agency to provide greater clarity on critical definitions to the WOTUS rule in order to avoid regulatory confusion and ensure consistent field implementation of the rule among regulators in EPA’s 10 regions and the Army Corps of Engineers. “It needs to be crystal clear, because the point we’re at right now, it’s not with the public,” one Local Government Advisory Committee source reported during a recent EPA listening session. “There may be a disconnect between EPA headquarters staff that crafted the rule and Corps district field regulators responsible for making jurisdictional determinations after the final rule is issued. That disconnect needs to be addressed before the agency finalizes the rule.”
The U.S. House of Representatives passed H.R. 5078 that would prevent EPA from adopting the proposed WOTUS rule (see Legislative section above).
October 2014: EPA has extended the comment period on the proposed Waters of the U.S. rule to November 14, 2014.
The EPA’s Science Advisory Board sent a letter to EPA Administrator Gina McCarthy saying that the regulatory proposal is supported by science and in fact should be more expansive. The SAB stated in the letter that the proposed rule may be excluding too many irrigation ditches, which gives agricultural interests even greater concern about the rule. The SAB even went so far as to state that
64
groundwater connections are very important to wetlands and other waters and should be included as waters of the U.S.
November 2014: EPA’s Science Advisory Board is urging the agency to develop a methodology to better quantify the connections between upstream waters with downstream waters traditionally regulated under the Clean Water Act (CWA). A boost for industry groups that say EPA’s planned method is scientifically unsound and could extend the CWA’s scope. The recommendations could increase criticisms from industry and other opponents of the rulemaking that both proposed rule and the draft study do not clearly address how regulators plan on distinguishing all nexuses or connection from “significant” ones, and could lead to jurisdictional findings that are based on flawed information.
A letter signed by 24 U.S. senators urging EPA and the Army Corps of Engineers to withdraw the Waters of the U.S. rule has been sent to Gina McCarthy, administrator of EPA, and John McHugh, Secretary of the Army. The letter states that, “undoubtedly, there is a disconnect between regulatory reality and the Administration’s utopian view of the proposed “waters or the United States” rule. A copy of the letter is available upon request.
Colorado Attorney General John Suthers also sent a letter to EPA and the Corps urging them to withdraw the Waters of The U.S. rule.
January 2015: Various attempts by Congress to halt funding for implementation of the WOTUS rule prior to adjournment of the 113th session failed. Many Republican senators and representatives have committed to introduce legislation to prevent EPA from moving forward with adoption of the rule, or to prevent the use of funds to implement the rule. EPA, however, continues to move forward and is now planning to adopt the rule as early as April 2015. Litigation is likely to be pursued from a number of affected parties if the rule is adopted as planned.
February 2015: During testimony before a joint meeting of the Senate Environment and Public Works Committee and the House Transportation and Infrastructure Committee, EPA Administrator Gina McCarthy told lawmakers that EPA is planning several revisions to the controversial Waters of the United States (WOTUS) rule defining the scope of the Clean Water Act, including expanding exclusions from the law to include stormwater infrastructure and other features, and rewriting its definition of a “tributary” subject to the CWA in order to resolve uncertainty on the term. McCarthy said she understands concerns raised by stakeholders that the proposed rule’s language defining “tributaries” and subjecting all waters meeting that definition to default CWA protection creates fears about certain agricultural erosional features, which are waterbodies created from erosion. She also said the agency would examine how the tributary definition in the proposed rule relates to ephemeral streams – responding to concerns from lawmakers, EPA’s science advisers, and others that the proposed language hinges on certain characteristics, such as an “ordinary high water mark,” that might not be present in ephemeral streams. Finally, McCarthy indicated that the agency will try to shore up its definition of “significant nexus” in the final rule, referring to the legal test created by Supreme Court Justice Kennedy’s ruling in Rapanos v. United States.
65
The joint hearing gave critics and proponents of the proposed rule a chance to outline their positions on the policy, with some opponents urging EPA to clarify disputed terms in the rule and others pushing for withdrawal of the rule. The agency has not said that it will scrap the policy, although McCarthy suggested that EPA’s non-binding April deadline for releasing the final rule could slip. [EPA Water Policy Report]
April 2015: EPA has sent the final Clean Water Act -Waters of the United States (WOTUS) rule to the White House Office of Management and Budget (OMB) for review. The agency is pushing for a release date in April, the last major regulatory step before it can issue the rule. EPA’s decision to send the final rule for review on April 6 underscores the agency’s opposition to calls from some GOP lawmakers to re-propose the regulation to address a host of concerns raised over it.
The EPA has acknowledged that they are planning several revisions to clarify the rule, including the definitions of “tributary,” “floodplain,” “and “uplands,” and concerns that the rule was developed without proper consultation with state and local governments and small businesses.
Many Senators are not accepting EPA’s proposal to revise the rule and recently approved by a 59- 40 vote to approve a budget resolution amendment that seeks to limit the scope of the rule by establishing “bright lines” for determining when smaller waters are considered subject to the water law.
A joint House-Senate hearing over the rule on February 4 did little to ameliorate concerns. Despite EPA Administrator Gina McCarthy’s efforts to clarify the proposal and respond to expressed concerns, Republican legislators remained dissatisfied. They continue to insist that the rule be withdrawn and re-proposed following extensive outreach to state and local governments, agricultural groups, small businesses and others. Some Senators are considering development of a bipartisan bill to force EPA to withdraw the draft rule until the outreach conditions are met.
May 2015: Rep. Bill Shuster (R-Pa.) and Rep. Bob Gibbs (R-Ohio) have introduced legislation (H.R. 1732) to prevent promulgation of the Waters of the United States (WOTUS) rule. The Regulatory Integrity Protection Act of 2015 would require EPA and the ACOE to withdraw the rule within 30 days of enactment. The agencies would have to propose a new rule based on public comments received on the April 2014 proposal and a related cost-benefit analysis and scientific study on waters’ connectivity that the agencies used to develop and justify the proposed rule. Additionally, the bill’s text says it would require the agencies to jointly consult with “representative State and local officials, stakeholders, and other interested parties on how to define the term ‘waters of the United States’” in the Clean Water Act and include any consensus advice from stakeholders in a new proposed rule.
The legislation specifies that a new proposed rule must preserve state and local authority and private property rights over natural and man-made water features, incorporate advice from the consultations on accounting for differences in local geography, hydrology, legal frameworks and address other local concerns. The consultation process must be initiated within three months of enactment and result in publication of a report responding to each of the more than one million public comments submitted on the proposed rule and the connectivity study, along with a “detailed explanation of how the new proposed rule addresses the advice and recommendations provided by
66
the State and local officials,” according to the bill text. The bill was passed by the House Transportation and Infrastructure Committee and is expected to be passed by the full House soon. A similar bill was approved last year by a vote of 262-152.
The Senate is also considering a bill (S. 1140) that would require the EPA and ACOE to issue a revised rule no later than December 31, 2016. The rule would be required to outline the types of waters that would be subject to CWA requirements. The bill also specifies that a “water of the U.S.” should not include: water that is located below the surface of the land, including soil water and groundwater; water that is not located within a body of water including channels that have no bed, bank or ordinary high water mark or surface hydrologic connection to traditional navigable water; isolated ponds; stormwater and floodwater management systems; wastewater management systems; municipal and industrial water supply management systems; agricultural water managements systems; streams that do not have enough flow to carry pollutants to navigable water; prior converted cropland, and areas lawfully filled pursuant to a permit or areas exempt form permitting.
June 2015: Two Senate hearings on different provisions of the WOTUS rule were held on May 18. The Senate Environment and Public Works Subcommittee on Fisheries Water and Wildlife heard testimony in support of S. 1140 which is the opponents preferred legislation for countering the rule. The bill would send U.S. EPA and the ACOR back to the drawing board with the proposed rule. The agencies would be required to consult with small businesses, states and other groups before redrafting the rule. The other hearing was held by the Small Business and Entrepreneurship Committee to hear testimony on the economic implication of the rule. The EPA claims that the rule would generate $2.00 in benefits for every $1.00 in cost, but opponents argue that the economic analysis was fundamentally flawed and the regulation would have a negative ripple effect across the economy.
The EPA and ACOE released the revised WOTUS rule on May 27. The rule will automatically apply jurisdiction to all tributaries and adjacent water, or water bordering, neighboring or contiguous to other jurisdictional water. It lists five specific types of “similarly situated” waters that will be evaluated on a case-by-case basis to determine whether they are jurisdictional. These waters include prairie potholes, Carolina and Delmarva bays, pocosins, western vernal pools and Texas coastal prairie wetlands. Waters within a 100-year floodplain of other waters would be subject to case-by-case jurisdiction analysis, while a host of water features, such as ditches with ephemeral flow that are not a relocated tributary or excavated in a tributary, groundwater, erosional features, and stormwater control features would be excluded from jurisdiction.
The revisions to the proposed rule satisfied some of the concerns expressed by interests such as wastewater and stormwater utilities, but other groups including farmers, ranchers and small business interests remain largely opposed.
The EPA has yet to publish the rule in the Federal Resister, which will trigger a 120-day window under the Clean Water Act for filing suit over it. Alternatively the agencies might publish the rule under Administrative Procedure Act authority which sets a 90-day window for filing suit. It is very likely that the rule will be challenged when it is published.
67
The rule is also being challenged in Congress through the 2016 budget appropriation process. The House passed the appropriation for the Interior Department and EPA with a provision that would prevent the EPA and the ACOE from adopting or enforcing the rule. President Obama has threatened to veto either S.1140 and appropriation bills that contain riders delaying or halting implementation of the WOTUS rule.
July 2015: Twenty six states have now filed lawsuits in federal district courts over EPA’s Waters of the United States rule claiming it violates the Clean Water Act, the Administrative Procedure Act (APA) and the Constitution. Colorado is participating in one of the lawsuits with twelve other Western states and state agencies. A copy of a press release issued by Attorney General Cynthia Coffman is available upon request, and a copy of the complaint is available upon request.
August 2015: Municipalities are seeking additional clarity form EPA and the Army Corps of Engineers on regulatory exclusions that the agencies’ joint Clean Water Act (CWA) jurisdiction rule creates for municipal separate storm sewer systems (MS4) and certain types of ditches, including which party is responsible for enforcing the exclusions. EPA stated that the agency is in the process of “sitting down with each of the states to make sure we’re on the same page with what the rule means.”
The U.S. Court of Appeals for the 6th Circuit has been chosen to hear suits over the rule, consolidating challenges filed in several circuits. The decision is considered to be a win for industry groups that asked the 6th Circuit to hear the case, though any briefing is likely to wait until federal district court cases over the rule are resolved.
Senator James Inhofe (R-OK) is arguing that a series of memos between the Corps of Engineers and EPA show that EPA failed to fully consult with the Corps on the rule and the rule is, therefore, lacking factual, technical and legal support and should be withdrawn. The memos reveal strong disagreement between the two agencies over certain provisions of the rule. The EPA claims that the disagreements were prior to the rule being published.
September 2015: The U.S. District Court for the District of North Dakota Southeastern Division granted a preliminary injunction blocking implementation of the WOTUS rule in a lawsuit filed by 13 states, including Colorado. The judge indicated in his ruling that he would likely rule in favor of the plaintiffs because the rule likely oversteps the Supreme Court’s standard for federal authority set in its 2006 Rapanos v. United States decision, and that the EPA and Corps of Engineers also appear to have violated Administrative Procedures Act requirements. In a decision made after the initial injunction, Judge Erickson ruled that the injunction would apply only to the 13 states that filed the initial lawsuit. The EPA is proceeding with implementation of the rule in all other states.
Lawsuits filed by other states in different district courts and courts of appeals have been stayed until a decision is made on whether the suits should be heard in district courts or courts of appeals. With the various lawsuits and the confusion over jurisdiction, it is likely that the legality of the WOTUS rule will ultimately be decided by the U.S. Supreme Court.
68
The National Conference of State Legislatures (NCSL) during its recent annual meeting failed to reach consensus on a resolution expressing “dissatisfaction” with the WOTUS rule, reflecting a longstanding split among the states over whether to support the policy. A vote over a resolution outlining the group’s opposition to the regulation ended in a 19-19=1 tie that meant it failed.
October 2015: The litigation situation has become even more complicated with a recent U.S. Court of Appeals for the 6th Circuit order blocking EPA from implementing its Clean Water Act jurisdiction rule nationwide while it weighs whether it has authority to hear suits over the rule, though at least two judges suggest if they hear the suit then they will scrap the policy for exceeding EPA’s authority. The court is still weighing arguments over whether it has authority to hear challenges to the WOTUS rule. The Clean Water Act is unclear on whether challenges to nationally applicable rules issued under the water law must be heard in federal district or appellate courts, prompting myriad lawsuits at both levels. More than a dozen lawsuits have been file in various federal district courts.
On October 13, the seven member federal court multi-district litigation (MDL) panel signed an order that stating it would be “inappropriate” to centralize the various district court suits in one case since none are expected to involve fact-finding and will instead require judges to rule on whether the rule’s text, or the differences between its proposed and final versions, overstep the bounds of the CWA or Administrative Procedure Act (APA). “Centralization will not serve the convenience of the parties and witnesses or further the just and efficient conduct of this litigation,” the order says. The decision clears the way for the several district court cases to proceed, and in at least one of the cases the challengers are citing the order in calling for their suit to advance.
Legislatively, Senate Republicans are pushing a Congressional Review Act (CRA) disapproval resolution to scrap the WOTUS rule, a move that if successful could prevent future administrations from crafting a similar policy to clarify the law's scope. The resolution has gained the support or 46 Republican senators, but no Democrat senators.
November 2015: The legal battles are continuing with little progress made toward determining of a venue or venues for hearing lawsuits challenging WOTUS. The 6th U.S. Circuit Court of Appeals is scheduled to hear oral arguments on December 8 to determine whether proper venue is the court of appeals or district court. Once that decision is made, the lawsuits will move forward either in numerous federal district courts or several appeals courts. Regardless, it is hard to see how the litigation will not eventually end up at the U.S. Supreme Court. Importantly, due to previous court decisions, the rule is currently stayed from implementation in the entire United States.
December 2015: U.S. District Court for the District of North Dakota Judge Alice Senechal has rejected EPA’s bid to stay a suit over the WOTUS rule pending an appellate court decision on whether it has authority to hear challenges to the rule, with the judge saying the agency failed to show “sufficient reason” for halting the lawsuit. In the order, Senechjal set a November 20 deadline for the U.S. Department of Justice to file a certified index to the administrative record, with any motions to supplement the record due by December 4. The state’s motion for summary judgement is due January 4, 3016 with a reply brief by February 29, 2016, and DOJ’s motion is due by February 15, 2016, with final briefs due by March 21, 2016.
69
In a separate case, a three-judge panel of the U.S. Court of Appeals for the 6th Circuit held oral arguments on December 8 to decide whether challenges to the WOTUS rule should be heard in U.S. courts of appeal or in U.S. district courts. The dispute revolves around language in the Clean Water Act that requires certain challenges to sections of the Act to proceed to a court of appeals as opposed to a federal district court. The 6th Circuit previously stayed implementation of the rule until it issues a decision on whether it has authority to hear consolidated appeals suits over the rule.
Legislatively, the U.S. Senate on November 4 passed a resolution to kill the WOTUS rule under the Congressional Review Act, opponents second attack on the rule after a previous attempt to block implementation of the rule was stopped by Democrats. The resolution was approved by a vote of 53-44. The House, which has voted a number of times to oppose the rule, is expected to approve a similar resolution, but the Obama administration has been clear that it will veto the measure. Finally, 90 lawmakers have signed a letter urging House leaders to include policy riders to block the WOTUS rule in the year-end omnibus spending bill. As of December 10 a rider to halt implementation of the rule remains in the House funding bill.
January 2016: The Government Accountability Office issued a legal opinion finding that the EPA engaged in “covert propaganda” in violation of federal law when it blitzed social media to urge the general public to support President Obama’s controversial Waters of the United States rule. Despite the finding, the continuing controversy and the multitude of lawsuits challenging the rule, Congress removed a policy rider which would have blocked implementation of the rule prior to approval of the 2016 omnibus appropriations bill.
Meanwhile, the House of Representatives approved their version of Senate Joint Resolution 22 which would give Congress 60 days after finalization of the rule to block its implementation. The Senate previously approved the resolution on November 4, 2015. President Obama has promised to veto the resolution.
EPA has launched a campaign to change the reference to the WOTUS rule from Waters of the United States, which carries the connotation that the rule covers all waters in the United States to the Clean Water Rule. EPA Administrator Gina McCarthy stated, “I’m really concerned that we weren’t crystal-clear, out of the gate, not just about what we intended to do, but about what we weren’t intending to do, because it left all kinds of room for people to wonder not just about what the words said but about what we were trying to accomplish.”
The multitude of lawsuits continue to wind their way through the federal court system with the current focus of the primary suit, State of North Dakota, et al., v. EPA being what should be included in the administrative record. The group of 14 states suing EPA are seeking a broad administrative record in the case to include Army Corps of Engineers staffers’ memos faulting a draft version of the rule, saying the documents will help prove the state’ claims that the rule was issued in “bad faith.” The Department of Justice is fighting to keep the memos out of the record.
February 2016: President Obama vetoed Senate Joint Resolution that would have prevented implementation of the WOTUS rule.
70
The White House Office of Management & Budget (OMB) is reviewing EPA’s draft formal response to Government Accountability Office (GAO) criticisms that the agency violated legal restrictions on use of appropriations in how it promoted the WOTUS rule. At a February 11 House Agriculture Committee on the impact of the agency’s rules on the rural economy, several lawmakers quizzed EPA Administrator Gina McCarthy about the rule. Critics echoed long- running attacks on the rule which was jointly proposed by the EPA and U.S. Army Corps of Engineers. Several lawmakers during the hearing criticized EPA’s efforts to promote the rule. “I think it’s a big deal because it goes to the integrity of the comment process,” Rep. Bob Gibbs (R- OH) said. McCarty responded that she believe EPA’s actions followed allowable guidelines and should not be considered to be lobbying. [INSIDEEPA.COM]
March 2016: The U.S. Court of Appeals for the 6th Circuit issued a ruling stating that it will rule on challenges to the WOTUS rule. The question before the Court was whether lawsuits filed over the WOTUS rule should be heard in federal district court or be elevated to the federal appeals court level. Several lawsuits have been file at both the district court and appeals court levels and most were stayed pending a ruling on the issue by the 6th Circuit Court of Appeals.
The ruling was a 2-1 decision with one judge ruling in favor only because a previous case ruling which he believes was decided incorrectly established a precedent for the case under review. So, the ruling did little to provide clarity on current litigation as it failed to resolve whether the myriad federal district court cases over the rule will continue and the majority’s reasoning could be vulnerable to a rehearing request. In fact, the plaintiffs in the case have file a petition for en banc rehearing by the full 6th Circuit. It is unclear how many courts outside of the 6th Circuit’s states of Kentucky, Michigan, Ohio and Tennessee will acknowledge the appellate ruling, but Oklahoma district court is adhering to the ruling. Another appellate case on the rule is pending in the 11th Circuit where Georgia and 10 other states are seeking to overturn a federal district court ruling that said the appellate court is the correct venue for the suit. A ruling in that suit has not been made. Finally, the EPA has filed a motion to dismiss a lawsuit filed by 13 states in the District Court in North Dakota. The North Dakota court was proceeding with arguments in the case and had previously ruled that the district court was the proper venue for the case. The Court has not ruled on EPA’s motion.
April 2016: Six groups including thirteen state governments (including Colorado), a coalition of Georgia industries, the Utility Water Act Group representing 200 power providers, the National Association of Manufacturers, the American Farm Bureau Federation, the American Road and Transportation Builders Association the Chamber of Commerce, the Washington Cattlemen’s Association, and the Texas Alliance for Responsible Growth, Environment and Transportation have all filed petitions for an en banc rehearing of the 6th Circuit Court of Appeals decision that the Court of Appeals is the appropriate venue for hearing challenges to the WOTUS rule. In the meantime, the District Court for the District of North Dakota has yet to rule whether to defer to the 6th Court of Appeals decision or to proceed to trial on its own. Clearly, there remains a lot of confusion and dissension on the proper venue for WOTUS challenges. The main issues concerning the legality of the rule cannot move forward until these matters are resolved. So, litigation will undoubtedly continue for several months, if not years.
Nearly half of the Republicans in the U.S. House of Representatives are calling for an appropriations bill rider that would block federal funding for implementing the WOTUS rule. The 71 lawmakers asked the leaders of the House Appropriations Subcommittees on Energy and Water and Interior and Environment to add the rider to their fiscal 2017 spending bills. It would block the EPA or the ACOE from using any federal funds to implement the WOTUS rule. The same funding restriction has been attempted for the last two years and have been abandoned each year to avoid a shutdown of the federal government.
May 2016: The U.S. Court of Appeals for the 6th Circuit rejected requests from several states and industry groups to review the three judge panel’s decision giving the court authority to hear suits over the WOTUS rule, leaving a Supreme Court appeal as the last option for the rule’s critics to challenge the decision. “The original panel has reviewed the petitions for rehearing and concludes that the issues raised in the petitions were fully considered upon the original submission and decision of the cases,” stated the April 21 order. Following the Court’s order, a new order was issued setting a May 30 deadline for petitioners and EPA to submit a joint briefing proposal seeking recommendations for the length of each brief, length of time for completion of briefing ahead of planned oral argument, whether additional briefing by intervenors is necessary, and other issues.
The EPA, in response to the 6th Circuit’s decision to not conduct an en banc hearing filed a motion to dismiss four lawsuits filed in federal district court in Texas challenging the EPA’s rule, arguing that the 6th Circuit’s ruling is controlling and deprives the district court of authority under the Administrative Procedure Act, and creates duplicative litigation. At the same time, a coalition of 13 states, including Colorado, filed a motion in the U.S. District Court for the District of North Dakota arguing that the 6th Circuit’s ruling is not binding in the North Dakota District Court because it is in the 8th Circuit. Therefore, the state’s lawsuit should proceed. In another suit, the U.S. District Court for the Southern District of Ohio’s Eastern Division dismissed a challenge to the WOTUS rule that was filed by three states. The Court cited the 6th Circuit’s ruling as the reason for dismissal. Finally, The U.S. Court of Appeals for the 11th Circuit ordered a new briefing in a lawsuit over the WOTUS rule seeking input on how the case is affected by the 6th Circuit’s decision. In that case, 11 states are seeking to overturn a ruling by a federal district court stating that the Court of Appeals is the proper venue for challenges to the rule.
On the legislative front, an attempt to add an amendment to the Senate’s energy and water appropriations bill prohibiting implementation of the WOTUS rule failed in a 56-42 vote.
June 2016: In response to the 6th Circuit Court of Appeals decision to not conduct an en banc hearing on its decision that the proper venue to hear challenges to the WOTUS rule is the Court of Appeals, the District Court in North Dakota halted proceedings until the issue is decided in appeals court or the Supreme Court. However, the judge refused to dissolve a preliminary injunction blocking the rules implementation in 13 states. The Circuit Court of Appeals is continuing to review motions on whether to defer similar challenges to the WOTUS rule or defer to the 6th Circuit Court. Likewise, the 10th Circuit Court of Appeals has set a briefing schedule to hear an appeal filed by state and business groups seeking to overturn a U. S. District Court ruling dismissing the groups’ challenges to the rule for lack of jurisdiction.
July 2016: A group of 30 states including Colorado is asking the U.S. Court of Appeals for the 10th Circuit to reverse a lower court’s decision to defer to a 6th Circuit ruling that appellate courts are the proper venue for suits over challenges to the WOTUS rule claiming that it unlawfully
72
restricts parties’ Administrative Procedure Act judicial review rights. The states argue that the lower court’s reliance on the 6th Circuit ruling is improper because it expands section 509 of the Clean Water Act, which ultimately restricts APA review of final agency actions by barring filings after 120 days of EPA issuing an action.
The 11th Circuit Court of Appeals heard oral arguments on July 8 on procedural challenges to a lower court ruling that denied a preliminary injunction to kill the rule.
The 6th Circuit Court of Appeals has set a briefing schedule for motions concerning the administrative record and for merits arguments in Murray Energy, et al, v. U.S. EPA, et al, which consolidates a host of suits filed by industry groups, states, and others over the WOTUS rule. July 8 is the deadline for motions regarding the administrative record and September 30 is the deadline for opening briefs to be filed by state, business, and association petitioners and November 30 is the deadline for briefs to be filed by the Department of Justice on behalf of EPA and the Corps of Engineers.
August 2016: the U.S. Court of Appeals for the 11th Circuit has halted litigation over EPA and ACOE’ WOTUS rule in the appellate court and a lower court, deferring to ongoing consolidated challenges to the rule in the 6th Circuit which will soon advance to briefing on the merits of the cases. The abeyance order applies “pending a decision of the 6th Circuit on the issue involving the validity of the Clean Water Rule, or until further order of this Court,” according to the decision.
October 2016: Thirty one states and multiple agriculture, livestock, oil and other industry opponents of the WOTUS rule have filed petitions with The U.S. Supreme Court to resolve the “jurisdictional Quagmire” of legal challenges over the proper venue to hear lawsuits pertaining to the rule. As the petitions await a Supreme Court decision, the 6th Circuit Court of Appeals is moving ahead with the litigation and has issued a briefing schedule that begins on November 1 and concludes with final briefs being filed no later than March 8, 2017.
January 2017: The U.S. Supreme Court has agreed to take up the dispute over which lower courts have jurisdiction to hear challenges to the WOTUS rule. The Court will reconsider the 6th U.S. Circuit Court of Appeals’ decision to hear legal challenges over the rule. In February 2017, the Ohio-based 6th Circuit ruled 2-1 that it had jurisdiction to hear the challenges and issued a nationwide stay of the rule pending the resolution of the litigation. The decision by the Supreme Court to review the 6th Circuit decision is a big setback for the Obama administration, which has sought to keep the litigation in the appellate court and avoid fights in district courts that might be more sympathetic to challengers of the rule.
Despite the Supreme Court decision, the 6th Circuit is proceeding with the litigation and briefs have recently been filed by the Plaintiffs and Respondents. A response will now be filed to the Respondents brief prior to oral arguments.
March 2017: President Trump on February 28, 2017 issued an Executive Order (EO) directing U.S. EPA and the U.S. Army Corps of Engineers (ACOE) to review the Clean Water Rule (Attachment 8). Subsequently, EPA and ACOE jointly filed a notice in the
73
Federal Register proposing to rescind or revise the rule as appropriate and consistent with law.
Affordability
EPA Acting Administrator Bob Perciasepe stated that the EPA is looking to clarify its policy for deterring whether cities can afford water infrastructure upgrades necessary to comply with Clean Water Act (CWA) sewer rules, with the agency aiming to identify flexibilities states could use to alleviate water rate cost hikes on low income households. Local governments have long urged EPA to change its current metric for calculating whether ratepayers can afford addition compliance costs, which allows individual ratepayer to be charger up to two percent of median household income to help finance necessary upgrades. They claim the EPA policy should be “more nuanced” than the current median household income metric it uses because large urban population have a wide range of income levels, meaning that using a median as a metric may cause lower income residents undue economic hardship. EPA has been urged to calculate a municipality’s affordability – whether individual ratepayers can pay bills without undue economic hardship – rather than its “financial capability” which is the relationship between a community’s economic condition and investments needed to make water quality improvements.
May 2013: Mayors are strongly rejecting EPA’s suggestion that utilities consider variable water rates where higher income households bear a greater burden than lower income households as an alternative to the agency’s current policy for determining cities’ capability to afford sewer upgrades, which uses a uniform measure of household income. “Uniform rate structures may place a disproportionately high financial burden on households with low incomes,” EPA sys in a memo explain its position. “EPA strongly encourages municipalities to consider establishing lower rates or subsidies for low income customers.” The mayors’ rejection of the idea raises doubts about the extent to which EPA and municipal officials will be able to reach a common understanding on addition policy flexibilities the agency can provide to cities when it determines whether they can afford infrastructure upgrades needed to comply with combined overflow requirements.
June 2013: The U.S. Conference of Mayors, American Water Works Association, and Water Environment Federation released an issue brief offering several alternative metrics for better gauging the affordability of water mandates. They suggest the impact on customer water bills should be assessed across entire income distributions, and especially at the lower end: as a percentage of income for potentially vulnerable population: across neighborhoods known to be economically at risk: and through a variety of other indicators such as the unemployment rate and the percentage of households receiving public assistance. The brief, entitled Assessing the Affordability of Federal Water Mandates is available at www.awwa.org or upon request.
July 2013: the National Association of Clean Water Agencies released a white paper titled The Evolving Landscape For Financial Capability Assessment: Clean Water Act Negotiations and the Opportunities of Integrated Planning, in which the organization describes the use of alternative measures to define affordability for water and wastewater consent decrees. EPA’s 1997 guidance sets two percent of median household income as the method for assessing communities’ ability to afford infrastructure upgrades to prevent combined sewer overflows. NACWA and other groups
74
want EPA to develop a metric for assessing financial capability that includes other factors besides median household income, including: income distribution, poverty rates, unemployment, tax burden, long-term debt, residents’ water bills as a percentage of household income, and the percentage of household receiving food stamps or other government assistance.
August 2013: In a meeting with National Association of Clean Water Agency representatives, EPA staff stated that the agency will not revise its 1997 financial capability guidance, or move away from its matrix calculation as a baseline for negotiations on affordability of EPA rules. However, the agency acknowledged that there is a need for clearer direction on the extent to which utilities can supplement, or potentially deviate from the guidance. The agency is working on a Financial Capability Framework to further outline the flexibility it believes is available to utilities. A draft of the Framework is expected to be released in early September 2013.
September 2013: The new president of the Association of Clean Water Agencies (ACWA) is calling for EPA to reconsider what it expects states to do because of ongoing federal and state budget pressures that she says are limiting states’ ability to implement new regulatory requirements. “There is going to have to be a recognition that we can’t just keep doing more things with less money,” Shellie Chard-McClary, Oklahoma’s director of water quality and the new ACWA president, said in a recent interview. “If states are going to spend $4 million for a new computer system for the pending electronic reporting rule, there are going to have to be fewer inspections done,” she said. Given reduced federal infrastructure assistance and increased pressure on state and utility budgets, it is becoming increasingly difficult to implement more frequent and more costly EPA rule requirements.
February 2014: EPA expects to release in January a draft of its new guide for assessing communities’ ability to pay for new infrastructure and other upgrades necessary to comply with Clean Water Act (CWA) requirements, and is indicating that it will allow the agency to consider economic measures other than median household income (MHI). The framework will likely not supersede the 1997 guidance requirements, but will allow EPA to address “things like a local government’s bond rating, or what the unemployment rate is in the community.” There is a list of six indicators that are merged into this permittee financial capability indicator according to Andy Crossland with the EPA. “We want to make sure that the next dollar gets spent in the smartest place for it to be spent so we don’t have enforcement coming in and saying, ‘you’ve got this violation so you have to spend your money on this’ when you can get a better environmental benefit from something else,” Crossland said.
Municipal officials are also seeking to develop alternatives to the median household income measure used by EPA. They are seeking to allow additional flexibilities when determining whether cities can afford to pay for their CWA mandates, such as combined sewer overflow improvement costs.
November 2014: EPA plans to include new considerations of water systems’ financial circumstances, such as bankruptcies, pension liabilities and the size of the water system, in its framework for assessing a municipality’s ability to pay for infrastructure upgrades needed to comply with Clean Water Act (CWA) mandates, changes that agency advisors has urged. The agency plans to incorporate most of the recommendations made by the Environmental Financial
75
Advisory Board into the final framework to be released in November or December, 2014. The framework is meant to supplement EPA’s original 1997 affordability guidance, which generally allows enforcement personnel to use a formula under which a cost of less than two percent of median household income is deemed “affordable.”
December 2014: After more than a year of drafting and revising based on comments from stakeholders, EPA distributed its final Financial Capability Framework for Municipal Clean Water Act Requirements to the ten EPA regional offices on November 24. The final framework is not substantially different from the draft released in March. The 1997 guidance on financial capability, which has been the foundation of EPA’s work in this space, remains the starting point for all negotiations, but the new Framework stresses the important role the supplemental information a community may submit plays in determining the final outcome. It is unclear exactly how or if the Framework was modified to reflect the recommendation made in a report by the Environmental Financial Advisory Board. However, the Framework should prove very useful for utilities dealing with these issues. [From EPA Water Policy Report]
January 2015: Environmentalists are looking to individual cases where implementing variable water rates could ease the financial burden of ratepayers to pay for a municipality’s Clean Water Act (CWA) compliance costs after EPA’s new framework for financial capability failed to include the language on those rate structures. Environmental groups had urged EPA to include language on variable water rates – where higher income households bear a greater burden than lower income households – in its framework for assessing a municipality’s ability to pay for infrastructure upgrades needed to comply with CWA mandates, but the agency did not include such language when it released its final “Financial Capability Assessment Framework” on November 25, 2014. The concept of EPA mandating any type of rate structure or rate level would establish a very dangerous precedent in my opinion.
February 2015: Mayors are renewing an effort to convince Congress to approve legislation that would overhaul EPA’s definition for when Clean Water Act (CWA) mandates are “not affordable” for low income ratepayers that meet certain requirements, in order to give more flexibility to municipalities in how they craft integrated water pollution control plans.
At a January 21 meeting of the U.S. Conference of Mayors’ (USCM) water council in Washington D.C. several mayors pushed for revival of legislation first introduced during the 113th Congress that would define CWA mandates as unaffordable if they impose costs of more than two percent of Median Household income (MHI) of 20 percent or more of the service area, allow up to 10 years for implementation, and require EPA to update its 1997 affordability guidance to provide a comprehensive review of all the financial burdens on municipalities and ratepayers.
The mayors continue to point out that affordability criteria is administered differently by various EPA regions and EPA headquarters needs to create a uniform policy applied consistently by all of the regions.
August 2015: Water industry groups are reviving the possibility of a federal program to provide subsidies to low-income households for their water bills, similar to an existing Department of Housing & Urban Development (HUD) program that provides energy bill assistance, following
76
clarified EPA guidance on municipalities’ ability to pay for infrastructure upgrades that failed to address all of utilities’ concerns. The groups including the American Water Works Association, the National Association of Clean Water Agencies, the Association of Metropolitan Water Agencies, the Water Environment Federation and the National Association of Water Companies, have begun to discuss the potential for a federal program or initiative that would help address water affordability concerns in low-income communities.
October 2015: EPA’s Water Infrastructure and Resiliency Financing Center is preparing to release this winter a collection of case studies and other tools to help water utilities address customers’ ability to pay for drinking water and wastewater services, expanding the center’s previously announced focus on innovative water infrastructure financing initiatives. The center, which is part of President Obama’s “Build America Initiative” unveiled in January 2015, is still in development. The agency has thus far described the center’s purpose as a place to assist local and state governments in implementing new water finance initiatives such as the Water Infrastructure Finance and Innovation Act (WIFIA) and public-private partnerships the administration frequently promotes as key to meeting future water infrastructure challenges.
December 2015: Water utilities are shifting their focus from surveying municipal programs that address concern about low-income households’’ ability to pay for water and wastewater services to studying the legal barriers to creating such programs, and will collaborate with EPA’s recently announced efforts to survey existing programs to help inform potential federal efforts to create a new subsidy program. “We were going to do what EPA was doing,” a water industry source says, “Now we are going to look into the legal battles, and benchmark what is going on in the gas and electric area with their low income funds and learn from those.”[insideepa.com]
The National Association of Clean Water Agencies (NACWA), Water Environment Federation (WEF), and American Water Works Association (AWWA) are partnering on development of a Resource Guide on Variable Rates and Subsidies. The effort will provide a state-by-state analysis of different subsidy programs available, the legal frameworks that support them, and the specific legal or regulatory barriers to the use of variable rates. The findings will be published as a resource guide prepared in coordination with an effort by EPA to publish a compendium of rate assistance programs that have been implemented by water and wastewater utilities in select communities.
April 2016: Affordability of water and wastewater services is receiving increasing attention by virtue of the fact that water and sewer costs are escalating at a much higher percentage than inflation, and because the Flint, Michigan water crisis has received tremendous attention from legislators, regulators, the media and the public. Forty percent of the residents in Flint are below the poverty level, yet they pay some of the highest water rates in the Country. A number of grassroots activists are becoming more involved, and are receiving more attention for these reasons. Some of them promote water and sewer service affordability as a civil rights issue. Many of them are also becoming increasingly concerned with the ever increasing number and expense of regulations that are imposed without funding, and the decline in the reliability of many utilities infrastructure. The cost burden to comply with the regulations and to rehabilitate and replace aging infrastructure are falling on water and sewer customers, some of whom simply cannot afford the costs. Some cities are now adopting ordinances prohibiting termination of water service for non- payment when the customer meets certain age or income criteria. Affordability has been a growing
77
issue of concern for water and sewer utilities, but Flint has brought it to the attention of the general public and the need to deal with the problem will increase in importance in the future.
May 2016: EPA’s long-awaited document intended to help water utilities address customers’ ability to pay their drinking water and wastewater bills includes a call to examine factors such as variable rate structures and burdens on renters versus homeowners – something the agency had not previously included in official affordability documents but which environmentalists had urged.
EPA’s Water Infrastructure and Resiliency Financing Center (WIRFC) released on April 19 its compendium of Drinking Water and Wastewater Utility Customer Assistance Programs. The document is intended as a collection of case studies and tools to help water utilities address customers’ ability to pay for water and wastewater services, specifically looking at rate assistance for low-income rate payers and affordability best practices. The document includes the results of an EPA survey of 800 utilities and found that more than a quarter of those offer some type of customer assistance program. EPA makes clear in the document that it is not meant to address “overall utility affordability of developing or complying with drinking water and/or wastewater regulations,” and instead focusses solely on programs that water utilities have developed to assist customers struggling to pay water and sewer bills.
Environmental groups have urged EPA to include language on variable water rates, where higher- income households might bear a greater burden than lower-income households, or “alternative rate structures,” such as block rates for certain charges and direct financial assistance for low-income residents. [Inside EPA.com]
March 2017: Michigan State University (MSU) recently released a study claiming that 14 million American households (11.9 percent) could not afford water in 2014 based on EPA criteria for affordability of 4.5 percent of the household’s income being spent on water costs. If water costs continue to rise at the same rate experienced over the past five years – 41 percent – then on third of American households (40 million) will lose access to affordable water. The university used data from an American Water Works Association survey of water utilities to establish a price of $120 for an average monthly consumption of 12,000 gallons of water for a family of four in 2014. By comparison, “even under 2017 rates, Denver Water customers would pay an average of $56 for the same amount of water, though the average Denver customer uses less. Outside city customers would pay between %60 and $70 a month.
While the numbers in the MSU report appear to be inflated, at least for local circumstances, the point remains that water and wastewater rates are rising at a rate higher than the overall rate of inflation and higher than income levels are rising, particularly in older Midwestern and Eastern communities faced with older infrastructure and declining populations where increasing costs must be spread over fewer rate payers. This is quite evident in municipalities like Detroit where at one time over a third of the customers were delinquent in payment of their water and sewer bills. Many municipalities have, or are considering adoption of programs to assist low income residents with their water and sewer bills, including using rate revenues to create a fund used to subsidize customers that meet certain low income criteria.
78
Affordability will continue to generate a lot of discussion and analysis in the water and sewer industries given aging infrastructure, high construction costs, more stringent water quality regulations and reduced federal government funding assistance.
Lead and Copper Rule
EPA is developing regulations to implement the Reduction of Lead in Drinking Water Act which President Obama signed in January 2011. The law changed the Safe Drinking Water Act’s definition of “lead free” to require all pipes and potable water plumbing fixtures to have a weighted average of no more that 0.25 percent lead content. Previously, pipes and pipe fittings could contain up to eight percent lead and still be considered lead-free. Implementing the law is proving to be difficult, however, because a number of issues have not been addressed in time for the law’s effective date and will now have to be dealt with in pending revisions to the EPA’s lead and copper rule.
One issue that will impact most water utilities is a recent pronouncement from EPA that fire hydrants with leaded nozzles do not fall under the exemption for pipes and fixtures that are used exclusively for nonpotable services because they “can be, and are, used in emergency situations to provide drinking water when there are disruptions to the normal operations of the drinking water distribution system. Water providers are strenuously opposing the EPA’s reasoning and federal legislation is being introduced to reverse the EPA’s interpretation. The EPA decision not to exempt fire hydrants from the lead-free requirement will cost utilities and hydrant manufacturers millions of dollars. EPA has agreed to consider utilities concerns, but has yet to change its decision.
January 2014: EPA is revisiting how it defines a public utility’s authority to oversee implementation of regulations intended to reduce exposure to lead in drinking water as part of a newly launched effort to make comprehensive revisions to the lead and copper rule. A new working group has been established by the National Drinking Water Advisory Council to work through a number of lead and copper rule revision issues, one of which is how to define “control” over lead service lines. Under the standard promulgated in 1991, EPA required public water systems to replace each year seven percent of the initial number of lead service lines (LSLs) in the distribution system if they do not meet action level requirements after corrosion control or other treatment designed to prevent lead leaching from lead pipes and plumbing fixtures. In the 1991 standard, EPA presumed that a public water system “controls” the water service line up to the wall of the building unless the system does not own the line: does not have the authority to replace, repair, or maintain the service line or have the authority to set standards for construction, maintenance or repair of that line. Under this definition, a utility cannot rebut this presumption unless it demonstrates that its control is limited by state statute, local ordinance, another public service contract or some other legal authority.
Under the current LCR, systems must replace the portions of the LSL that the water system owns, rather than the broad definition of “control” under which a system “controls” a line if it owns it or has any other authority to replace, repair or maintain it, provided it doesn’t conflict with local statutes.
79
EPA wants the working group to consider whether it should eliminate the partial LSL requirement entirely when a property owner cannot pay for the replacement of the portion of the LSL on his or her property. The agency is also directing the working group to consider re-opening public comment on the broader control definition again.
April 2014: The Lead and Copper Rule Working Group held its first of six meetings in March to consider several possible revisions to the Lead and Copper Rule (LCR). The March 25 – 28 meeting was focused primarily on ensuring the drinking water treatment process does not cause corrosion in lead service lines, which can result in lead leaching into drinking water. One of the primary ways utilities ensure compliance with the rule is to optimize their corrosion control techniques. During future meetings the working group will explore whether the rule should require partial or full lead service line replacement, including whether EPA should expand the areas where water utilities would be required to replace service lines: whether water samples are being taken in the right places to detect lead and copper exceedances: and whether to change the protocol for collecting samples.
October 2014: EPA has begun a rulemaking to codify an amendment to the Safe Drinking Water Act (SDWA) that lowered the amount of lead content that can be allowed in drinking water pipes and fixtures. The law, which changed the statutory definition of lead-free plumbing fixtures, went into effect January 4, 2014, but the agency officials said in 2012 that the implementing regulation would take longer to develop. The proposed rule is expected to address whether manufacturers should demonstrate that a product is lead-free: whether all plumbing products should meet the lead-free definition or whether there should be dual lines of products allowing higher lead content for some statutorily noted exemptions: how non-portable products would be identified if dual product lines are allowed: how to identify lead-free products: how to calculate lead content, and whether one part of a system or facility can be repaired using lead-free component parts and returned to service even if other component parts that were not repaired do not meet the new lead- free definition.
December 2014: An EPA advisory panel is generally in favor of requiring drinking water utilities to replace all portions of lead service lines to reduce lead in levels in drinking water, but the group is struggling to develop a recommendation on how the agency should address that in forthcoming revisions to the lead and copper rule. Under the current rule, water systems that do not meet the required lead action level after the installation of corrosion control treatment (CCT), a program which is also under review as part of the workgroup, and/or source water treatment, must replace at least seven percent of the initial number of lead service lines in their distribution system annually. But a system is currently only required to replace the portion of the lead service line that it owns or controls, which does not extend to pipes that connect homes or businesses to water mains in public right of ways.
Work group members at a November 12–13 meeting appeared to agree that the requirement for “partial” replacement, the rule’s definition of “control” and the requirement for seven percent replacement must be revisited because they do not adequately protect the public from the harmful effects of lead contamination, a position long urged by environmentalists. However, several legal and policy questions remain over whether EPA can mandate full line replacements and if the agency cannot require it, how it can encourage utilities to do it. [EPA Water Policy Report]
80
April 2015: An EPA advisory committee is considering recommendations for the agency to require drinking water utilities to design their own long-term programs to replace their lead service lines to reduce lead levels in drinking water as part of forthcoming revisions to the lead and copper rule (LCR), in order to get past the issue of whether utilities “control” all of the pipes delivering water to customers. The National Drinking Water Advisory Council’s Lead and Copper Rule Working Group, which is charged with developing recommendations for updating the rule, has struggled with determining whether full lead service line (LSL) replacements can be mandated, and if not, how utilities can be encourage to do so. Under the current LCR, water systems that detect lead levels higher than enforceable standards at the consumers’ taps must replace at least seven percent of LSLs in their system annually. The replacement requirement, however, only applies to the portion of LSLs the utility owns or controls, which does not extend to pipes that connect homes or businesses to water mains in public right of ways. It is unclear what authority EPA might have to compel utilities and homeowners to replace the full line under the Safe Drinking Water Act when lead levels do not meet the required action level.
May 2015: The National Drinking Water Advisory Council (NDWAC) Lead and Copper Rule Working Group is recommending that the EPA provide drinking water utilities with a “checklist” of actions to completely replace lead service lines (LSLs), placing an emphasis on continued improvement rather than just meeting deadlines to reduce lead levels in drinking water. The group has concluded in prior meeting that utilities should be required to replace all portions of LSLs, rather than the partial replacements allowed under the current rule. However, the question of how to encourage utilities to do so, as well as the way to define who controls which portions of lead pipes is still up for debate within EPA. The checklist lists a number of actions or activities a utility could choose from to indicate that it is making progress toward meeting the requirements of the new proposed lead and copper rule.
The group recommends that utilities work toward the requirements in a sequence of three-year milestones, beginning 36 months after the enactment of the new rule, with a faster pace for milestones early on since “progress may be more difficult to achieve in later years with those LSLs that remain at that time.” The milestones include: confirming that “targeted education” programs for homeowners with LSLs are in place; providing status and results of a consumer lead sampling program; confirming operational policies are in place, and providing with an update on their line replacement progress.
August 2015: The National Drinking Water Advisory Council’s Lead and Copper Rule Working Group has concluded that it cannot ask the EPA to require all drinking water utilities to cease partial lead service line replacements, despite scientific expertise suggesting that the partial replacement are not effective in reducing drinking water lead levels, and is weighing options to instead strongly encourage the full service line replacement. The group had previously considered prohibiting the current widespread practice of partial replacement and wanted to require utilities to replace the entire service line, even in cases where the utility does not own of maintain portions of the line.
November 2015: An EPA advisory panel is recommending that the agency provide public water systems with suggestions for how the systems can encourage full replacements of lead service
81
lines, including “creative” financing options for low-income communities as a way to address environmental justice concerns. The final draft of recommendations from the Nation Drinking Water Advisory Council (NDWAC) Lead and Copper Rule (LCR) Working Group details plans to strongly encourage full lead service line replacement (LSLR), by setting goals for replacement, working with customers to speed up replacement and receiving credit for replacement of lead- containing connecting pipes and/or confirmation that a service line initially inventoried as an LSL is not lead. The full NDWAC is scheduled to finalize the report at a November 17-19 meeting in Washington, D.C.
December 2015: EPA’s National Drinking Water Advisory Council (NDWAC) during its meeting on November 17-19 unanimously supported a work group’s recommendation on how the agency should revise its lead and copper drinking water rule despite concerns from environmental, public health, and municipal advocate who say the recommendation fail to adequately protect water customers from the effects of lead poisoning. NDWAC’s recommendation strongly encourage drinking water utilities to conduct full lead service line replacements (LSLRs), rather than partial replacements, by setting goals, working with customers to speed up replacement and receiving credit for replacement of lead-containing connecting pipes and/or confirmation that a service line initially inventoried as an LSL is not lead. The recommendations do not call for prohibiting partial replacements. In addition, the final recommendations advise EPA to strengthen corrosion control treatment (CCT); modify monitoring requirements to provide for customer-requested tap samples and to assess the effectiveness of CCT; establish a health-based, household action level that triggers a report to the consumer and to the applicable health agency for follow up and separate the requirements for copper from those for lead, with new requirements targeting water that is corrosive to copper.
February 2016: It has been very prominently reported in the nation media that Flint, Michigan exceeded the Federal Drinking Water Act action level for lead for several months resulting in high blood lead levels in children. A task force charged with determining responsibility for the contamination and lack of response has assigned primary blame to the Michigan Department of Environmental Quality. The head of the department has since resigned and the manager of the water quality section has been fired. The administrator for EPA Region 5 has also resigned following accusations that EPA knew of the contamination, but did not act to correct it in a timely manner. The governor of Michigan has also been roundly criticized for his delayed reaction to the situation. In the meantime, several lawsuits have been filed, the U.S. Congress has held hearings and demanded corrective action, a dispute over authorization of relief funds for Flint has halted progress on the bipartisan energy bill that has been in the works for many months, and Michigan and the federal government have declared Flint a man-made disaster area and granted several million dollars in aid.
The federal lead and copper rule that is undergoing revision (see above) is likely to be strengthened significantly as a result of the Flint situation. Testing and reporting requirements will probably be enhanced and the replacement of lead service lines, regardless of ownership is undoubtedly going to receive more attention. The revised rule is anticipated to be issued sometime in 2017, but there will be increasing pressure to move the proposed rule forward as soon as possible.
82
April 2016: In response to the Flint Water Crisis (see below), the EPA sent letters to governors and water regulators across the County promising greater enforcement of the lead and copper rule. Further, the letters urged every state to locate lead water service lines as required by the rule. EPA Administrator Gina McCarthy said her staff would meet with leaders of all state drinking water programs to make sure they are properly carrying out and enforcing the rule.
EPA water officials are pushing back against some Republican lawmakers’ suggestion that the agency’s failure to update its lead and copper rule (LCR) since 1991 contributed to the Flint, MI, drinking water crisis, while also saying the agency is considering a wide range of comments in deciding how to revise the rule.” “I do not accept the conclusion that says the reason things went wrong [in Flint] is because you have a rule that was broken,” EPA drinking water chief Peter Grevatt told drinking water utilities. “If a rule, no matter how good it is, is implemented poorly, that rule is not going to protect the public. You need people who are rolling up their sleeves. You cannot do that with a good rule alone, you have to make sure everyone is playing their part.” Both Grevatt and EPA Deputy Assistant Administrator for Water Joel Beauvais in their comments to the Association of Metropolitan Water Agencies stressed that they would consider comments on the National Drinking Water Advisory Council’s lead and copper rule recommendations carefully as they work through what Beauvais called the “pretty gnarly and difficult policy challenges” wrapped up in the revision process. The EPA is proposing to release a revised lead and copper rule in 2017. [inside EPA.com]
Drinking water utilities are supporting changes to EPA’s lead and copper rule and are pledging to work with customers to remove all lead service lines, even as they acknowledge there needs to be a “serious discussion” about how utilities and customers will pay the estimated $30 billion cost of replacement. The board of the American Water Works Association voted unanimously to accept EPA’s National Drinking Water Advisory Council’s final recommendations for the agency to revise the rule emphasizing its support for replacement of lead service lines and increased monitoring and outreach to customers.
Four bills have been introduced in Congress to increase funding for lead reduction, enhance monitoring, and reporting on lead levels in water and require testing of lead levels in blood in children. These bills are listed in the Federal Legislation section of my report.
May 2016: The Colorado Department of Health responded to EPA’s letter requesting better enforcement of the lead and copper rule with a letter stating that Colorado shares EPA’s urgency in protecting public health and that it has a “robust program under the state-specific lead and copper regulatory requirements, which is as stringent as the National Primary Drinking Water Regulation and where we work to be consistent with the complex and frequently changing national guidance and EPA’s associated clarification memoranda.” The letter goes on to criticize EPA by stating, “The lead and copper rule is the most complicated part of the drinking water regulations to implement, and yet the database tool provided by EPA to implement this rule has grave deficiencies related to sampling schedules, compliance calculations, and tracking required activities.”
More than 100 water utility leaders from throughout the United States and Canada met in Washington D.C. to share strategies for removing lead service lines. During the session,
83 representatives from Boston Water and Sewer Commission, Cincinnati Water Works, Halifax Water in Nova Scotia, and Lansing (Michigan) Board of Water and Light described methods they used to remove lead services. The American Water Works Association who organized the meeting estimates there are 6.1 million lead service lines that serve seven percent of the population. Replacement of all lead services is estimated to cost upwards of $30 billion. The main obstacle to replacing the services is that in the vast majority of jurisdictions, the pipes are privately owned and the water utility has no right or obligation to remove them. This issue will continue to get increasing attention in response to the Flint water crisis (see below), and the EPA’s focus on issuing a revised lead and copper rule in 2017.
June 2016: Recent EPA guidance for lead sampling has prompted the Association for Metropolitan Water Agencies to seek clarification on whether the EPA is requiring that water utilities conduct a precise inventory of all lead service lines rather than ensure that lead sampling sites are locations known to have lead service lines. AMWA is concerned that the guidance could be interpreted to be a much more exact and comprehensive analysis than it believes is required by the lead and copper rule. The agency’s Office of Water Deputy Assistant Administrator Joel Beauvais stated that his interpretation of the requirement is that “systems are required to be aggregating new information as they go through routine maintenance and operating of their systems. Some systems are behind the curve in their knowledge of where the lead service lines are and it’s appropriate to catch them up on that.”
August 2016: EPA is encouraging water utilities to improve their lead service line inventories to help ensure they are taking lead samples from valid Tier 1 sites (those residences that have lead service lines). EPA is also asking that the location of lead service lines and sampling results be posted for public review. Several states have reported they have limited information on the location of lead service lines because they are private and inventories have not been kept. Some states and utilities have also declined to post individual sampling results citing privacy concerns. These issues will likely be addressed as the revised Lead and Copper Rule (LCR) is finalized and promulgated.
A letter signed by 61 members of Congress urges the EPA to lower federal standard for lead in drinking water so that it better reflects the latest science on the brain-damaging toxin. The aim is to better protect the public, members of Congress said.
Many activists are claiming that several states and utilities have used “loopholes” in the LCR to “cheat” while performing lead sampling. They claim that guidance issued by EPA prohibits pre- flushing service lines prior to taking samples. The rule actually prohibits flushing six hours prior to sampling, which does not preclude some utilities advisories that customers flush the pipe six hours before the sample is taken. The activists’ argument relies on a letter sent from EPA to the Alliance for Healthy Homes in 2008 in response to questions about lead sampling from that organization. The letter was not issued as guidance to utilities, but was merely responding to lead testing inquiries from the Alliance. Official guidance was not issued by EPA on the issue until February 2016 in response to the Flint crisis. It is now clear that pre-flushing is not to be conducted.
84
Fluoridation
Health advocacy groups are trying a new tack in their effort to ban fluoridation of drinking water, petitioning EPA to use its Toxic Substances Control Act. (TSCA) authority to ban the longstanding practice - introduced in the 1940s to promote dental health – because it poses neurotoxicity risks. “EPA should exercise its authority under TSCA to prohibit fluoridation additives because application of the Agency’s own Guidelines for Neurotoxicity Risk Assessment to the existing database on fluoride shows that ….neurotoxicity is a hazard of fluoride exposure,” says the petition filed recently by groups including the American Academy of Environmental Medicine, the International Academy of Oral Medicine and Toxicology, Food and Water Watch and Fluoride Action Network.
Flint, Michigan Water Crisis
A tremendous amount of media attention has been focused on the water crisis in Flint, Michigan. It all started in April 2014 when a governor appointed emergency manager of the City authorized changing the source of the Flint’s water from the Detroit regional system to another regional supplier. The alternate supply required extension of a water transmission main that was scheduled to take several months to install. Once the decision was made to separate from the Detroit system, Detroit terminated the contract with Flint requiring Flint to institute a temporary supply source, the Flint River, and reactivate an old treatment plant. When the treatment plant was reactivated, corrosion control treatment was not instituted. The corrosive Flint River water caused lead to leach from thousands of lead service lines raising the lead levels in the water to, in some cases, hundreds of times higher than the federal standard for lead.
Over several months it was determined that the blood lead levels in children far exceeded health standards. Both the Michigan Department of Environmental Quality (MDEQ) and the U.S. EPA failed to respond to the situation on a timely and appropriate basis. When the situation captured the attention of the public, elected representatives, and the media, the blame game began, but failed to illicit a response and plan to correct the problem in a manner commensurate with the danger being caused. An emergency was declared and Flint citizens were warned to not use the water for drinking, cooking or bathing. Bottled water was made available for citizens to use.
A task force to determine the cause and responsibility for the problem was appointed by the Governor of Michigan. Even before the task force completed its work the members were so appalled by the anemic response by all levels of government, it issued an interim report placing the primary responsibility on the MDEQ, but also criticized the EPA for its lack of oversight and response. Following the report, the head of MDEQ and some staff members resigned and the director of EPA Region 5 also resigned. The U.S. House of Representatives has held two very contentious hearings with the Governor, the EPA Administrator, the previous mayor of Flint, the previous city manager of Flint and others being castigated for their involvement in the ongoing crisis.
The Flint water supply has now been reconnected to the Detroit system and corrosion control has been enhanced. However, it will take weeks for the lead service lines to become recoated and the
85
leaching of lead to cease. The State of Michigan has committed $30 million to Flint for improvements to the water system, health tests and monitoring of individuals that consumed water with very high lead levels, and crediting rate payers for past payments for water that was unfit to drink. The federal government has also committed to provide aid to Flint.
Several lawsuits have been filed requesting everything from monetary damages to total replacement of the Flint water system, replacement of all lead service pipes, and health and psychological testing and treatment of Flint residents for years to come. Investigations have been launched by the Michigan Attorney General, the U.S. Attorney General, and the EPA Inspector General, and criminal prosecutions have not been ruled out. The situation has become the preeminent case of government failure on all level,s and an example of how not to respond to an emergency water quality situation. For a more detailed description of the Flint situation, including a detailed timeline, please go to the following website for the Flint Water Advisory Task Force’s Final Report: https://www.michigan.gov/documents/snyder/FWATF_FINAL_REPORT_21March2016_51780 5_7.pdf
May 2016: Michigan Attorney General Bill Schuette on April 20 issued criminal indictments against two Michigan state environmental department officials and one Flint employee as a result of their actions in the Flint water contamination crisis. Both felony and misdemeanor charges were filed accusing the individuals of misconduct in office, conspiracy related to tampering with evidence, and willfully providing false information. The men face up to four to five years in prison for each felony count and fines for each misdemeanor charge ranging between $5,000 and $10,000. The Attorney General stated, “These charges are only the beginning and there will be more to come.” The U.S. Attorney General is also investigating the water crisis.
The criminal charges followed a U.S. District Court dismissal of a tort suit brought by several Flint families seeking $150 million in damages from state and city officials for losses in water bills paid for lead-contaminated water. The Court stated that the plaintiffs could only seek federal relief under the Safe Drinking Water Act, though it left the door open for a case to be filed in state court. Many other tort lawsuits have been filed and are proceeding through state and federal courts.
June 2016: The National Association for the Advancement of Colored People has filed a lawsuit against state and city officials involved in the Flint water crisis. The suit names Michigan Governor Rick Snyder, former Michigan Department of Environmental Quality Dan Wyant, three former Flint emergency managers, city Utilities Administrator Mike Glasgow and six other leaders. The suit claims the officials and firms failed to detect problems and properly treat water. Plaintiffs include Flint residents and members of the local branch of the NAACP. The suit seeks financial compensation for property damage, pain and suffering, emotional distress, medical costs and other damages for residents affected by the water crisis.
August 2016: Michigan’s attorney general has charged six more state employees with crimes related to the lead-contamination water crisis in Flint. All are charged with misconduct in office, willful neglect of duty and various conspiracy counts. Three of the employees are with the Michigan Department of Health and Human Services and three with its Department of Environmental Quality (MDEQ).
86
The attorney general also filed a civil lawsuit against two engineering companies, saying their negligence caused and exacerbated Flint’s lead-tainted water crisis. The lawsuit demands what could total hundreds of millions of dollars in damages. The two companies, Veolia and Lockwood, Andrews and Newman are also facing suits from Flint residents.
The EPA has been encouraging the City of Flint to seek grant funding for replacement of lead service lines and improve its drinking water infrastructure through Michigan’s Drinking Water Revolving Fund. Even though the deadline for applying for grant funds was extended to enable Flint to file the appropriate application, the City had not filed the paperwork as of one week before the deadline. Then, on July 16 the City ran out of chlorine pellets needed to disinfect the City’s water supply. After notification by the MDEQ and the EPA the City was able to obtain an emergency supply of pellets from neighboring communities. A letter from the EPA to the mayor of Flint stated that the issue “demonstrated a continuing need for the City to take stronger action to effectively manage the drinking water system”.
Flint scaled back its proposal to replace 500 lead service pipes using $2 million received from the state when bids to complete the work were too costly. The project’s goals counted on bids to come in around $4,000 per pipe replacement, but the actual amount spent for the first 33 replacements was more than twice that amount.
A coalition of environmental and civil rights advocates is calling on EPA and the Department of Health and Human Service (HHS) to investigate whether Michigan officials violated civil rights laws in their handling of the Flint water crisis. The groups cited findings from the Flint Water Advisory Task Force report which concluded that the water crisis was a case of environmental injustice. “Flint residents, who are majority Black or African American and among the most impoverished of any metropolitan area in the United States, did not enjoy the same degree of protection from environmental and health hazards as that provided to other communities,” the task force report states. “Moreover, by virtue of their being subject to emergency management, Flint residents were not provided equal access to, and meaningful involvement in, the government decision-making process.”
March 2017: The most recent testing of lead levels in Flint indicate that the water system now meets federal water quality standards for lead and copper. However, Michigan is continuing to provide Flint residents with water filters and bottled water for drinking and is helping to pay for the removal of all lead service pipes. Since federal standards are now being met, the state has eliminated water bill credits that amounted to two thirds of customers’ water bills.
Hundreds of Flint residents filed a new lawsuit seeking $722.4 million in damages from the federal government. The suit claims the EPA was negligent and failed to act in a timely manner to address the city’s lead in drinking water crisis. The suit also alleges EPA failed to provide advice and “technical assistance” to local and state organizations that failed to meet Safe Drinking Water Act requirements.
87
Water Conservation
The Senate Energy and Natural Resources Committee on Water and Power held a hearing on August 25, 2012 on the need for federal funding for water conservation. Those giving testimony stressed the nexus between water and energy and the resulting energy savings available as a result of water conservation. It was also stated that a federal investment in water conservation would result in creation of 220,000 new jobs. Another point made was that the federal government should fund water conservation programs on a par with energy programs that have received billions of dollars in consumer rebates and tax incentives for energy efficiency.
The civil Society Institute and the Environmental Working Group released the results of a survey that they claim show the majority of Americans support advances in renewable energy like wind and power in order to reduce water use from fossil fuel and nuclear power plants. No mention was made of the monetary costs or savings involved in such an effort.
November 2012: [from Reuters News Service] Most Americans have scant understanding about their water supply, but they are concerned about it, and believe recycling water gives the United States an advantage over other countries, a survey said on Tuesday.
However, Americans are less accepting of drinking recycled wastewater in a practice known as toilet-to-tap, the survey found.
With clean water growing scarce in much of the world, and with shortages possible in 36 U.S. states in the next year, according to the General Accountability Office, the survey conducted for General Electric Co found 66 percent of Americans feel positive about water re-use.
Eighty-three percent of Americans surveyed said they were concerned about the availability of clean water in the future.
GE makes water treatment equipment and technology. It commissioned the survey to figure out whether there was opposition to re-using water as a solution to water scarcity.
"We see water re-use as one of the key methods of addressing water scarcity that we have and the increasing gap between water demand and supply," said Heiner Markhoff, president and CEO for water and process technologies for GE Power & Water. "For us, it's an interesting and important driver in the markets around the world that we serve."
The online survey of 3,000 people in the United States, Singapore and China showed Americans' understanding of water issues lags behind those surveyed in the other two countries. It also found what it termed an "ick factor" when Americans were asked about having wastewater recycled into drinking water - only 30 percent supported this - though 51 percent were in favor of swimming in recycled water and 51 percent agreed that it was drinkable.
However, eight out of 10 Americans favor using recycled water for other uses, including power generation, landscaping, industrial processing and manufacturing, toilet-flushing, car washing and agricultural irrigation.
88
December 2012: Preliminary results from a Water Research Foundation project concerning residential end uses of water report that annual single-family water use has gone down over the past 15 years. Reductions in both indoor and outdoor water use have been measured through the study. In Denver, 34% of the study homes had an average toilet flush volume less than two gallons per flush (gpf), indicating they are largely equipped with ultra-low flow (ULF) or high efficiency (HE) toilets. Meanwhile, 26 % of the homes had no flushes in the low volume range. The remaining 40% of the homes had a mixture of low volume and older high volume toilets.
Flushing frequency has not changed much over the nearly 20 years that Aquacraft, the study researcher, has been studying residential end uses. In Denver, an average was recorded of 12 toilet flushes per household per day. Homes equipped with lower volume toilets did not flush more frequently than homes equipped with higher volume toilets.
In Denver, the average toilet flush volume was 2.63 gallons per flush. This is the third time end use data has been collected from a representative random sample in Denver and there has been a steady decline in the average toilet flush volume as older fixtures have been replaced. The results show progress in flushing efficiency, but also indicate that conservation potential remains in the toilet category. In 2012, 20% of the toilet flushes in Denver still exceeded 3.5 gpf.
January 2013: The Plumbing Efficiency Research Coalition released the largest study conducted to date of water and waste flow in building drainlines. According to the study, the factors that most influence drainline carry from toilet flushes include: the volume of water, the slope of the drainline, and the type of toilet paper used. The importance of toilet paper came as a surprise to many. Two types of toilet paper were tested; high tensile strength and low tensile strength. The study found that toilet paper characteristics can greatly influence drainline transport with high tensile paper reducing drainline carry. Factors that have less influence in moving waste through drainlines include:
• Flushing mechanism - gravity flush or pressure assisted flush do not extend the distance waste is transported. • Trailing Water - toilets designed to deliver a surge of trailing water behind the waste do not move waste further in the drainline. • Clearing flush - introducing extra water into the drainline to clear clogged waste does not significantly impact the ability to move the waste through the drainline.
The study determined that toilet flush volumes below 1.28 gallons per flush are significantly less likely to transport waste through the drainline. Alternatively, flush volumes of 1.28 gallons (low flow toilets) are adequate in moving waste through the drainline.
August 2014: The Plumbing Efficiency Research Coalition (PERC) has secured funding for the second phase of its drainline carry research. “Phase two of this study will address two very important aspects of drainline transport,” said Pete DeMarco of IAPMO, the Research Director of the Study. “First this study will examine how a drain pipe size reduction influences drainline transport in a long building drain and the significance of that influence relative to slope, flush
89
volume and the other system variables studied in Phase 1. Second, this project will evaluate performance at the 1.0 gallons per flush volume. Phase 1 indicated reliable drainline transport performance in the test apparatus at the 1.28 gpf flush volume, but a more chaotic performance was observed at the 0.8 gpf flush volume level.”
April 2015: The Residential Energy Service Network (RESNET), in partnership with the Natural Resources Defense Council (NRDC) and a coalition of water efficiency experts, homebuilders, environmental organizations and home energy professionals is developing the nation’s first Water Efficiency Rating (WER) Index. The WER Index will show consumers at a glance how efficiently a home uses water by assigning it a numerical score based on performance. RESNET proposes to have the WER Index ready for use across the United States by the end of this year.
August 2015: The California Energy Commission has ordered new standards for shower heads, cutting the amount of water they can spray to a level that by 2018 will be the most stringent in the nation. The Commission said shower heads cannot exceed a maximum flow rate of two gallons per minute effective July 1, 2016, down from the current standard of 2.5 gallons. In 2018, the allowable rate will drop again to 1.8 gallons per minute.
January 2016: The White House launched an ambitious effort to enlist the private sector in its efforts to reclaim and conserve water, stating “it’s critical for the country to better manage water supplies that are under increasing pressures from climate change.” The strategy, known informally as a “moonshot for water,” focuses on encouraging technological advances and private-sector investment to rebuild water projects like reservoirs, boost data collection, support water-sharing agreements and find new technologies to recycle and conserve water.
Sally Jewell, Secretary of the Interior, announced the creation of a new Natural Resource Investment Center to help coordinate research and investment on water conservation and water rights management. The type of innovation proposed by the Center is better materials for water pipes to reduce leaks, better sensors to detect leaks, more water-efficient household appliances, and more cost-effective desalination technologies to transform seawater and brackish water into usable freshwater using less energy and emitting less greenhouse gases. Jewell also announced a Water Summit to be held at the White House on March 22 which is World Water Day.
February 2016: The Internal Revenue Service recently released a ruling concluding that payments made by water utilities for water conservation rebates and credits are taxable income. Utilities in California have granted millions of dollars in such rebates during the severe drought and are working with California legislators to introduce legislation to exclude the rebates from taxable income. In the meantime, the IRS will continue to consider the payments as taxable income.
May 2016: The Water Research Foundation released a report titled Residential End Uses of Water, Version 2 in April. The report updates a 1999 study and confirms that indoor water use per household continues to decline. The study includes data from 23 participating utilities across the United States and Canada, including Denver Water, and presents detailed information and data about how residential water use has changed over the past 15 years. Some key findings from the study include:
90
• Residential indoor water use in single-family homes has decreased 22% since WRF’s 1999 study, from 177 gallons per household per day (gphd) to 138 gphd. • Toilet flushing is the largest indoor use of water in single-family homes, followed by faucets, showers, clothes wasters, leaks, bathtubs, other indoor uses, and dishwashers. • The current average daily indoor per household use of 138 gphd could decrease to 110ghpd with full adoption of water-efficient fixtures. • Forty-six percent of homes in the new study had water-efficient clothes washers, compared to 6% in 1999, and 37% of the participating homes had efficient toilets, compared to 5% in 1999. • Household hot water use accounted for 33% of total indoor water use. • Regarding outdoor water use, analyzing the trends and efficiency in water use from landscaping and pools is more complex because of varied climatic regions and variations in planting at each house. At a high level analysis, the study found that while a minority of users are overwatering, most are not.
March 2017: The U.S. EPA announced $4 million in funding to Drexel University and Purdue University to research water quality issues related to low flow conditions of drinking water in premise plumbing systems. As water conservation efforts become more common and water shortages have occurred in some parts of the country, the use of low-flow plumbing fixtures, such as faucets, toilets, and showerheads, has increased. The use of these fixtures combined with population decrease in some locations, has led to lower water demands. “Decreases in water consumption result in lower flows of water through water system pipes that were designed to manage higher flows, which may negatively impact water quality. Waterborne disease outbreaks can occur due to issues with premise plumbing systems, emphasizing the importance of this research.” [U.S. EPA]
Tony Cocozzella, Scott Hand and I are keenly interested in this research because we have seen the very real impacts in sewer systems resulting from low-flow fixtures and low occupancy residences. We have observed situations in new subdivisions with low- flow fixtures and low occupancy homes where there is insufficient flow to move the wastewater debris through the sewer system. These areas are likely to require increased maintenance, and therefore increased maintenance costs.
Water Reuse
The Government Accountability Office recently issues a report on water reuse. The report finds that as fresh water becomes scarcer, utilities are looking to reuse their wastewater but face significant hurdles. While the technology exists to reuse water rather than discharge it into nearby rivers and streams after treatment, “utilities often face financial and regulatory challenges when considering the use of such technologies,” says the report. The report lays out many technologies that identify water leaks and assess the condition of pipes, as well as those that treat “nontraditional sources,” such as seawater and brackish water. Overall, the report finds that utilities that are large, that serve water-stressed areas or that manage both wastewater and drinking water are more likely to treat nontraditional 91
sources for water. The analysis also found that utilities with experience in treating these alternative sources found it easier to address the associated financial and regulatory issues.
Federal Litigation
Catskill Mountains Chapter of Trout Unlimited, Inc. et al v. EPA
A federal judge in the U.S. District Court for the Southern District of New York, vacated and remanded EPA’s 2008 water transfer rule, which says a transfer of water between two jurisdictional waterbodies, absent intervening industrial, agricultural or other use, does not require a discharge permit. The judge stopped short of completely vacating the rule, but told EPA to “reexamine and reevaluate some new ideas” on remand. He stated that the blanket exemption from National Pollutant Discharge Elimination System (NPDES) permits that the rule sought to provide is incompatible with the Clean Water Act goal of regulating the “discharge of a pollutant” into protected water. While the case is almost certain to be reviewed by the U.S. Court of Appeals for the 2nd Circuit and possibly the Supreme Court, the judge did not stay his decision pending appeal, raising the possibility that the rule is no longer in effect, which would leave operators conducting water transfers, including irrigation district, drinking water utilities, stormwater systems and other, that were authorized by the regulation open to citizen suits and other enforcement measures.
June 2014: EPA and several western states are appealing the lower court ruling that vacated the agency’s rule exempting water transfers from Clean Water Act (CWA) permit requirements. Governors from the states that filed the appeal including those from Colorado, New Mexico, Alaska, Arizona, Idaho, North Dakota, Nebraska, Nevada, Texas, Utah and Wyoming earlier this month urged the EPA to appeal the district court’s ruling and pledged to support the agency’s defense of the rule.
December 2014: Appellate judges considering one of environmentalists’ two ongoing challenges over EPA’s rule exempting water transfers from Clean Water Act (CWA) permit requirements could decide the case without reaching the validity of the rule, after signaling at oral arguments that they were considering a ruling base on site-specific factors instead. A three judge panel of the U.S. Court of Appeals for the 9th Circuit, which heard arguments in Oregon Natural Resources Council (ONRC) Action v. U.S. Bureau of Reclamation, November 21, appeared reluctant to address environmentalists’ claims that the water transfer rule is illegal. Instead, they asked attorneys for both sides if the suit could turn instead on the question of whether water was transferred between “distinct” waterbodies, or was instead moved through a single river, in which case the transfer rule would be irrelevant.
While Trout Unlimited is a facial challenge to the transfer rule, ONRC Action deals with the legality of specific transfers of water by the BOR. The 9th Circuit could hold that the transfers are illegal because the transfer rule is invalid – environmentalists’’ primary argument in the appeal – but they could also decide that the two waterbodies are not hydrologically separate, which would
92
invalidate the case as the Supreme Court has held that the CWA does not regulate the movement of water between two parts of the same waterbody. [EPA Water Policy Report]
March 2017: The U.S Court of Appeals for the 2nd Circuit in a 2-1 ruling reversed a lower court and found EPA’s Clean Water Act rule exempting the transfer of water from one basin to another from discharge permits is a reasonable interpretation of the law, and therefore should be upheld under the agency judicial deference doctrine known as Chevron. EPA’s Water Transfers Rule, promulgated in 2008, determined that “water transfers” are not activities that require a National Pollutant Discharge Elimination System permit. Under the rule, a “water transfer” is defined as “an activity that conveys or connects water of the United States without subjecting the transferred water to intervening industrial, municipal, or commercial use.” Water transfers are employed throughout the country and are especially important is Western states, where water providers seek water supplies for rivers, lakes and streams located in entirely different watersheds. Fifty percent of Denver Water’s water supply originates from the West Slope and is considered a “water transfer.”
Gulf Restoration Network, et al. v. EPA
Environmentalists have filed two major lawsuits aimed at forcing EPA to step up its efforts to strictly regulate high nutrient levels under the Clean Water Act (CWA), a move that is likely to revive controversy over the issue just as the agency has begun to get states to craft measures aimed at curbing nutrient pollution.
On March 13, a broad coalition of groups filed a suit, Gulf Restoration Network, et al. v. EPA, in the U.S. District Court for the Eastern District of Louisiana seeking to compel EPA to force Mississippi River Basin states to adopt strict numeric nutrient criteria after the agency last year denied a 2008 administrative petition on the issue.
A representative from the American Farm Bureau Federation has expressed strong concern that EPA will settle the lawsuits in a manner that will comply with the suits’ demands, specifically requiring numeric criteria for states in the Mississippi River basin.
The National Association of Clean Water Agencies issued a press release blasting the lawsuits and explaining that they seek to impose extremely high costs on municipal wastewater treatment plants while accomplishing little to solve the nutrient.
June 2012: A federal court has granted a request from industrial and municipal dischargers, including, the National Association of Clean Water Agencies, to intervene in environmentalists’ high-profile litigation aimed at compelling EPA to strictly regulate nutrient pollution in Mississippi River Watershed states -- a move that would give industry a seat at the table should EPA and activists initiate settlement talks.
The U.S. District Court for the Eastern District of Louisiana May 4 approved a recent request from the Federal Water Quality Coalition (FWQC) -- whose members include municipal, industrial and agricultural companies and trade groups -- to intervene in Gulf Restoration network, et al. v. EPA.
93
The underlying suit, filed last March, seeks to compel EPA to force Mississippi River Basin states to adopt strict numeric nutrient criteria and develop pollution load limits, known as total maximum daily loads (TMDLs), after the agency last year denied a 2008 administrative petition on the issue.
The motions to intervene in the case would ensure that, should settlement negotiations begin in the suit, the industry groups would have the right to be present and participate in those negotiations.
April 2013: Following is an article from NACWA The Water Voice which describes the complexities involved in nutrient litigation cases.
A few weeks ago, NACWA and a number of other groups filed legal briefs in an ongoing federal court case over regulation of nutrients in the Mississippi River Basin (MRB). At its heart, the case is about whether the federal government or individual states should take the lead in developing nutrient water quality criteria, and about which approach will lead to the most effective, holistic reduction in nutrient impairment. The case is also a perfect example of just how complex the nutrient issue can be from both a legal and regulatory perspective. It has implications not just for municipal clean water utilities discharging to the MRB, but for all utilities across the country.
The court battle began in March of last year when several environmental activist organizations sued the U.S. Environmental Protection Agency (EPA) over its decision not to develop federal numeric nutrient criteria (NNC) for the MRB. But in reality, the legal fight stretches back much further.
In 2008, the activist groups filed a petition with EPA, alleging that the individual states within the MRB had failed to make adequate progress in addressing nutrient issues or developing nutrient criteria. The groups also stated that EPA was legally required under the Clean Water Act to develop federal NNC for the entire MRB— as well as for other waters where necessary nationwide—in the states’ stead.
In 2011, EPA issued a letter denying the petition’s requests. EPA’s response acknowledged the significant environmental concerns presented by nutrient water quality impairment, but also indicated its belief that use of federal rulemaking authority was not an effective or practical means of addressing nutrient problems. EPA outlined some of the significant work it is already doing with individual states to help address nutrient issues. The Agency also poignantly noted that imposition of federal NNC would do little to address the significant nutrient impairment coming from nonpoint sources. The activist groups were not satisfied with EPA’s answer, so challenged the decision in court in March 2012.
NACWA moved quickly to participate in the case after it was filed and represent the municipal clean water perspective. Several other groups potentially affected by the case moved to join as well, including the American Farm Bureau and related
94
agricultural interests, a group representing the fertilizer industry, and the Federal Water Quality Coalition.
Together with NACWA, this group filed a joint brief in early March 2013 supporting EPA’s denial of the petition and decision not to promulgate federal NNC. At first blush, this may seem an odd group to join together on a legal document, particularly given some of the legal disagreements (see prior posting on Chesapeake Bay nutrients litigation) that NACWA and agricultural interests have had over the role of nonpoint sources in nutrient impairment. But in this specific case, we could all agree that federal NNC for the MRB would be both illegal and inappropriate, and that individual states must take the lead in developing standards and criteria for water quality protections with each state’s jurisdiction.
However, because nonpoint sources do play an outsized role in the nutrient problem, NACWA also filed our own, standalone presenting the unique municipal perspective on these critical nutrient issues. NACWA’s brief goes beyond the joint brief to make clear that a fair and balanced watershed approach among all contributing sources of nutrients—especially nonpoint sources—is the only way to achieve meaningful nutrient reduction. The brief argues that federal NNC are an insufficient tool to solve a problem that demands a holistic solution, and instead suggests that states should take the lead on developing nutrient criteria and control programs that will result in more equitable reduction efforts across all sources.
Interestingly, several individual MRB states have also joined the case and submitted their own joint brief in support of EPA and against promulgation of federal NNC. The state brief highlights both the importance of state primacy on water quality criteria development and the need for greater nonpoint source control. These are both points that echo and reinforce arguments raised in the NACWA brief.
Resolution of the case is still a long way off. The activist plaintiffs will have an opportunity to respond to all the briefs filed in the case, and the judge will have to review all of the competing arguments and ultimately make a decision. Regardless of the judge’s final ruling, it is likely some party to the case will not like the outcome and will decide to appeal.
But one thing is clear from all of the competing arguments and positions outlined by the various parties in the case: Nutrient control is an exceptionally complex issue, and especially so when viewed through a legal lens. Just as clean water agencies both within the MRB and nationwide will continue to do their part to address nutrients in a fair and equitable way, NACWA will continue to aggressively advocate on their behalf and provide a valuable municipal perspective on this complicated topic.
May 2013: The National Association of Clean Water Agencies participated in a reply brief filed May 10, 2013 in the Gulf Restoration Network v. EPA case. The brief supports EPA’s decision to
95 deny Gulf Restoration’s petition requesting federal numeric nutrient criteria for the entire Mississippi River Basin.
October 2013: A federal judge has ordered EPA to craft a formal response to environmentalists’ petition seeking strict new nutrient limits for states in the Mississippi River Basin, but the judge says the agency can deny the petition by citing the costs to craft and litigate such standards, reasons which the agency had previously cited to sidestep a determination. In his September 20 decision in Gulf Restoration Network et al. v. EPA et al. Judge Jay Zainey, of the U.S. District Court for the Eastern District of Louisiana said EPA must take a definitive stand on whether states’ current nutrient policies are adequate to address water quality impairment in the basin and the Golf of Mexico. Environmentalists are touting the ruling as a victory, but the decision appears to give the agency an open door to reject the petition on the grounds that enforcing federally crafted nutrient limits would be expensive and inefficient, even if the agency finds that more stringent policies are needed to meet water quality goals.
April 2014: In a March 17, 2014 order, the U.S. Court of Appeals for the 5th Circuit granted without comment EPA’s March 5 motion to stay the district court’s order in Gulf Restoration Network et al. v. EPA et al until the appellate court rules on the merits of the case. The litigation is significant because it will determine whether EPA and states will be forced to craft regulatory measures to limit nutrients in as many as 31 states that contribute nutrients to the Mississippi River, which is believed to be responsible in par for the Gulf of Mexico’s hypoxic “Dead Zone.”
May 2015: The Fifth Circuit Court of Appeals issued a decision in this case finding that EPA has significant discretion in how it responds to an activist group petition requesting federal numeric nutrient criteria for the entire Mississippi River Basin. The decision will make it much more difficult for activist groups to pursue federal numeric nutrient criteria, both within the Mississippi basin and elsewhere in the country.
Sierra Club v. BNSF Railway Company
A federal court has rejected industry efforts to dismiss environmentalists’ novel lawsuit seeking Clean Water Act. (CWA) discharge permits for train cars carrying coal and other pollutants, enhancing efforts to block new coal export terminal though the ruling leaves open the possibility that industry could still succeed after further briefing. Environmentalists argue that coal and coal dust is dislodged from open-top train cars during transportation and falls into jurisdictional waterbodies. This activity constitutes a discharge from a point source necessitating a NPDES permit.
Army Corps of Engineers v. Hawkes Co.
The matter before the court in this case is whether a Clean Water Act Jurisdictional Determination (JD) is a final agency action that can be challenged in court under the Administrative Procedure Act. The U.S. Court of Appeals for the 8th Circuit decided in 2015 that a JD create practical consequences for recipients, leaving them effectively unable to fill wetlands on their property
96
without either going through a potentially expensive permitting process or risking a costly enforcement action.
The case, which was argued before the U.S. Supreme Court on March 30, 2016, concerns the Hawkes Company, which harvest peat for golf courses. When the Company wanted to begin a peat-mining operation in Minnesota, the ACOE issued a JD stating that the land contains waters of the United States and was thus protected under the Clean Water Act. Though the property was 120 miles from the nearest major navigable waterway, the ACOE said the land contained wetlands and is adjacent to other waters that ultimately connect to the river. With that determination, certain uses of the lands required the company to apply for a clean Water Act permit which can take several years to process. Hawkes challenged the decision in federal court and the district court dismissed the case, finding that the determination was not a final agency action subject to judicial review. Hawkes appealed, and the 8th Circuit Court of Appeals reversed, finding that the determination is subject to review under the Administrative Procedures Act.
Supreme Court justices during oral arguments appeared to back Hawkes suit to allow pre- enforcement judicial review of federal agencies’ findings that waters are covered by the Clean Water Act. “The person who is subject to a JD has to take certain steps because of the law. One, spend $150,000 to try to get an exception and fail, or two, do nothing, violate it, and possible go to prison. Those sound like important legal consequences that flow from an order that, in respect to the agency, is final, for it has nothing left to do about that interpretation. And B, is perfectly suited for review in the courts,” Justice Stephen Breyer said.
June 2016: The Supreme Court ruled unanimously that property owners who receive a Clean Water Act jurisdictional determination (JD) saying their lands include waterbodies subject to the CWA may challenge those findings immediately in court rather than waiting for EPA or the Corps of Engineers to initiate permitting or enforcement action. Justice Kennedy wrote in his concurring opinion that “the Act, especially without the JD procedure were the government permitted to foreclose it, continues to raise troubling questions regarding the government’s power to cast doubt on the full use and enjoyment of private property throughout the Nation.” Further, “based on the government’s representations in the case, the reach and systemic consequences of the Clean Water Act remain a cause for concern.”
General Federal Related Matters
Colorado River Supply
River The Bureau of Reclamation projects that Lake Mead Reservoir will not have enough water to make full deliveries to Nevada and Arizona in 2018. A Bureau report shows the surface level of the lake behind Hoover Dam is expected to remain high enough this year to avoid a shortage declaration in 2017, by a narrow margin of four feet. The shortage in 2018 could trigger cuts in water deliveries that an official said would most affect Arizona farmers. A shortage declaration would cut 11.4 percent of Arizona’s promised 2.8 million acre-feet, and 4.3 percent of Nevada’s 97
allotted 300,000 acre-feet. Even if a shortage is declared, drought stricken California will be able to draw its full 4.4 million acre-foot allocation of Colorado water.
Colorado River Water Supply and Demand Study
On June 6, 2011, the Bureau of Reclamation, in conjunction with Colorado and the other six Colorado River basin States, released the first interim report on the the Supply and Demand for Water in the Colorado River Basin. The Basin Study, funded jointly by the Bureau of Reclamation and the Colorado River Basin States, is a forward-looking cooperative effort by all parties to address what future water supplies may exist in the Colorado River, the demands on those supplies and potential strategies to deal with imbalances in this important river system. Future releases of the Basin Study will begin to identify opportunities and solutions to the water supply challenges to be faced with regard to supply and demand imbalances. This report has been receiving a great amount of press in newspapers across the Southwest, and was a constant topic of conservation at the CU Summer Conference on the Colorado River hosted by the Natural Resources Law Center. For more information, see www.usbr.gov/lc/region/programs/crbstudy.html.
June 2012: The Bureau of Reclamation completed and released Technical Memorandum C - Quantification of Water Demand Scenarios to the Colorado River Basin Water Supply and Demand Study. The memorandum summarizes water demands by geographic regional and category (agriculture, municipal and industrial, energy, minerals, tribal, fish, wildlife and recreation). The May 2012 memorandum updates information from the June 2011 report and quantifies demands for six water demand scenarios. The final study report is due to be released later this year.
August 2012: The final Colorado River Supply and Demand Study report has been delayed until September 2012 as the Bureau of Reclamation continues to analyze 150 proposal designed to reduce demand, increase supplies or invoke new management strategies for the Colorado River.
September 2012: Release of the Colorado River Basin Water Supply and Demand Study final report has been delayed from September 2012 to November 2012.
December 2012: The final Colorado River Supply and Demand Study report was released on December 12, 2012. It is available for viewing or download at www.usbr.gov/lc/region/programs/crbstudy.html. It is interesting to note that prior to release of the study it was widely reported in the media that one of the options considered in the report to meet future water demands is the importation of water from the Missouri River to Colorado’s Front Range.
February 2013: A summary of the Colorado River Basin Water Supply and Demand Study prepared by the Colorado River District is available upon request.
May 2013: The Bureau of Reclamation and representatives from numerous States have presented information of the basin study at dozens of conferences and workshops to educate the water community about the contents of the study. The Basin States and The Bureau are now finalizing
98
a process for exploring “next steps” and are intending to roll out the process by the end of May 2013.
June 2013: the U.S. Bureau of Reclamation (BOR) convened a meeting of Colorado River stakeholders to determine “next steps” following release of the Colorado River Supply and Demand Study. The study predicted a shortfall of 3.2 million acre-feet of water by the year 20160 due to increasing demands brought about by population growth, diversion of water for energy development and stream flows that have to be maintained at certain levels due to enhanced environmental needs. Sixty percent of the increase in use is projected to come from the lower basin states of Arizona, New Mexico, California and Nevada.
At the conclusion of the meeting, three inter-state committees were established to devise plans for conservation, possibly including water reuse, desalination, water banking and the sale of water from farms to cities. The committees have been ordered to have their recommendations ready by the end of 2013
July 2013: A copy of a Water Law & Policy Monitor article pertaining to the BLM Colorado River Supply and Demand study is available upon request.
August 2013: The Water and Power Subcommittee of the Senate Energy and Natural Resources Committee heard testimony from several federal, state and tribal officials on the Bureau of Reclamation’s Colorado River Basin Water Demand and Supply Study. Witnesses, including Reclamation Commissioner Mike Connor, Upper Colorado River Commission Director Don Ostler and Kathleen Ferris, executive director of the Arizona Municipal Water Users Association, stressed the importance of the Colorado River to western states. The river and its tributaries provide water for 40 million people in the United States and Mexico, where the river empties into the sea of Cortez, and they provide irrigation water for 15 percent of the crops produced in the United States. They also support a $26 billion recreation economy. But there is increasingly less water to meet the needs of cities, farms, endangered species, recreation and other demands on the river. The study projects a 3.2 million acre foot gap between available supply and demand in the basin by 2060. The river is already over allocated in the lower basin, and there is not enough water to meet demand in some areas, a number of witnesses warned. Further, climate change is expected to reduce flows by nine percent, increasing the risk of shortages for cities, farms and habitat.
September 2013: The Bureau of Reclamation continues to work with workgroups created to develop plans for resolving the gaps between future Colorado River supplies and demands. A paper describing the effort is available upon request.
September 2014: The three workgroups (municipal and industrial conservation and reuse, agricultural conservation and transfers, and environmental and recreation flows) continue to meet and develop data and information for the reports on their respective subject matters. The workgroups will be reviewing draft reports within the next couple of months, and the reports are now scheduled to be published by the end of December, 2014.
July 2015: The Bureau of Reclamation released the Moving Forward Phase 1 Report that documents opportunities and potential actions to address the future water supply and demand
99
imbalances projected in the 2012 Colorado River Basin Water Supply and Demand Study. The report is part of the Colorado River Basin study effort launched in May of 2013.
Three major, broad recommendations are made in the report:
1. Increase water use efficiency by making the best use of supplies available for municipal, industrial and agricultural purposes, while aligning management of supplies with the environment and recreation in mind, where possible. 2. Reduce system losses by identifying and reducing conveyance and distribution system losses. By minimizing those losses, costs can be reduced and water conservation, revenue and water availability for others increases. 3. Maximize reuse of supplies by reusing supplies more than once, especially outside the hydrologic basin.
The report notes that generally across the basin’s major metropolitan areas, per-capita use has decreased anywhere from 11 percent to 38 percent since 1990 and by 10 percent since 2000. The consumption rates have declined even in the face of growing populations and persistent drought and are in part due to conservation efforts mounted by water providers.
Phase 2 of the Moving Forward effort will be underway later this year and will include the selection and implementation of several pilot projects. The report is available at www.usbr.gov/lc/region/programs/crbstudy/MovingForward
November 2015: A group of 23 scientists including Brad Udall from Colorado State University are claiming that the Colorado River study conducted by the U.S. Bureau of Reclamation overstated how much water the river will have and how much people will demand from it. They are strongly encouraging an independent review be conducted by the National Academy of Sciences into how the federal government is researching the river’s problems, issues and management. The group made their request in a letter sent to Interior Secretary Sally Jewell. The Interior Department has not yet responded to the letter.
January 2016: Deputy Interior Secretary Michael Connor during a speech during a meeting of the Colorado River Water Users Association warned the if water interests in Arizona, California and Nevada cannot find a fix for the Colorado River’s problems, the federal government will. Connor talked of the need to prevent Lake Mead from falling to dangerously low level, potentially low enough to force Draconian cutbacks in water deliveries to cities, farms and Indian tribes in Arizona. The risk in now up to 30 percent that Lake Mead will drop to potentially dangerous levels in five years, Connor said. He further stated that he hoped the states will have reached agreement by the time of next year’s conference. The primary concern of the Bureau of Reclamation is that water levels will drop in Lake Mead and, possibly, Lake Powell to a point where there is a significant drop in the ability to produce hydropower which supplies electricity to large sections of Nevada and California. The revenue from the sale of power is used to pay for operation of the Colorado River storage facilities and many other Bureau of Reclamation programs.
100
Development, Planning and Construction Activity
Platte Canyon
No Activity
Southwest Metropolitan
No Activity
Platte Canyon Tap Permit Sales – Attachment 9
Permits issued in February 2017
Water Taps Sewer Taps
0 :-inch new water tap permits 0.00 s.f.e. sewer tap permits
0 1-inch new water tap permits 0.00 s.f.e. renewal sewer tap permits
0 12-inch water tap permits 0.00 s.f.e. equivalent (commercial)
0 2-inch water tap permits
Permits issued Year to Date 2017
Water Taps Sewer Taps
0 :-inch new water tap permits 2.00 s.f.e. sewer tap permits
0 1-inch new water tap permits 0.00 s.f.e. renewal sewer tap permits
0 12-inch water tap permits 0.00 s.f.e. equivalent (commercial)
0 2-inch water tap permits
101
Southwest Metropolitan Tap Permit Sales – Attachment 9
Permits issued in February 2017
Water Taps Sewer Taps
1 :-inch new water tap permits 1.00 s.f.e. sewer tap permits
1 1-inch new water tap permits 0.00 s.f.e. renewal sewer tap permits
2 12-inch water tap permits 3.00 s.f.e. equivalent (commercial)
1 2-inch water tap permits
0 3-inch water tap permits
Permits issued Year to Date 2016
Water Taps Sewer Taps
1 :-inch new water tap permits 1.00 s.f.e. sewer tap permits
1 1-inch new water tap permits 0.00 s.f.e. renewal sewer tap permits
2 12-inch water tap permits 3.00 s.f.e. equivalent (commercial)
1 2-inch water tap permits
0 3-inch water tap permits
Miscellaneous
1. Email from Marne H. Tutt regarding Southwest Metropolitan service charge and my response. (Attachment 10).
S:\data\WPDOCS\DOCUMENTS\Word Files\PC-SWM Mgr Info Report BOD version 032417.docx 102
ATTACHMENT 1
WRITTEN PLAN FOR THE CONDUCT OF A MAIL BALLOT ELECTION TO BE HELD MAY 2, 2017
1. Contact information for Special District conducting the election:
Name of the Special District Southwest Metropolitan Water and ("District"): Sanitation District Primary contact person: Patrick J. Fitzgerald Phone: 303-979-2333 Email: [email protected] Principal Office Address: 8739 West Coal Mine Avenue Littleton, CO 80123
2. Date of the Election: May 2, 201 7 ("Election")
3. Type of Election: Special Inclusion election
4. Citation of the statute authorizing election:
Title 32, Article l, C.R.S.; Title 1, Article 13.5, C.R.S.; and Article X, Section 20 of the Colorado Constitution ("Election Laws").
The political subdivision will conduct the Election according to all relevant provisions of the statutes authorizing the Election.
5. Name and contact information for the Designated Election Official who will be responsible for all aspects of the election:
Crystal Schenck, Collins, Cockrel & Cole, P.C., 390 Union Boulevard, Suite 400, Denver, Colorado 80228-1551, telephone number (303) 986-1551 [email protected]
6. Eligible electors and timing for mailing ballots:
There are approximately twenty eligible electors.
No later than 40 days prior to the Election (March 23, 2017), the Designated Election Official shall request a list of the registered electors residing within the District from the County Clerk for each county in which the District is located. The Designated Election Official shall also request a list of the owners of all taxable real and personal property with the District from the County Assessor for each county in which the District is located. Such initial lists shall be received no later than 30 days prior to the Election (March 31, 2017), and the supplemental
{00554385.00CX I } lists received no later than 20 days prior to the Election (April 12, 2017). Sections 1-13.5-203(1), 1-13.5-204(1) and (2), and l-13.5-l 105(2)(a) and (b), C.R.S. No later than 45 days prior to the Election (March 17, 2017), the Designated Election Official or election judges will mail a ballot to each active eligible elector residing within the District who is a covered voter, as that term is defined in Section 1-8.3-102, C.R.S. (UOCAVA). Section 1-13.5-1103(4), C.R.S.
Between 22 and 15 days before the Election (April l 0, 2017 to April 17, 2017), the Designated Election Official or election judges will mail ballots to each active eligible elector of the District. Section l-13.5-l 105(4)(a), C.R.S.
7. Total number of drop-off/walk-in locations:
There will be one (1) place of deposit, which will be located at Collins, Cockrel & Cole, PC, 390 Union Boulevard, Suite 400, Denver, CO 80228. For security reasons, there will be no unmonitored freestanding drop-off locations.
Ballots can also be mailed to the District's Designated Election Official at 390 Union Boulevard, Suite 400, Denver, Colorado 80228-1551.
The walk-in location to obtain new or replacement ballots and to drop off voted ballots shall be located at 390 Union Boulevard, Suite 400, Denver, Colorado 80228-1551. This location will be open from 8:00 a.m. to 5:00 p.m., Monday through Friday, beginning at least 22 days prior to the Election (April 10, 2017), and from 7:00 a.m. to 7:00 p.m. on the day of the Election. Section l-13.5- l 105(4)(d), C.R.S.
8. Notice of Election:
A notice of the District's election shall be published one time on April 5, 2017 (at least 20 days before the Election) in the Columbine Courier and one time on April 6, 2017 in the Douglas County News-Press and Littleton Independent and, which are legal publications having general circulation in the District. Such notice shall also be posted in the office of the Designated Election Official and sent to the County Clerk and Recorder. Sections 1-13.5-502(1) and (2) and l-13.5- l 105(2)(d), C.R.S.
9. Ballot delivery and processing:
The Designated Election Official will supervise the distribution and handling of the ballots and will take the necessary steps to protect the confidentiality of the ballots cast and the integrity of the election. The Designated Election Official
{00554385.DOCX/ ) shall appoint a sufficient number of election judges to distribute, handle and count the ballots. The election judges will also take the necessary steps to protect the confidentiality of the ballots cast and the integrity of the election.
All deposited ballots will be counted as provided by the Election Laws. A mail ballot will be valid and counted only if it is returned in the return envelope, the self-affirmation on the return envelope is signed and completed by the eligible elector to whom the ballot was issued and the information on the return envelope is verified.
If the Designated Election Official or an election judge detennines that an eligible elector to whom a replacement ballot has been issued has voted more than once, the first ballot returned by the elector will be considered the elector's official ballot. Any other ballot will be rejected.
Ballot envelopes will be date stamped upon receipt. Each day when ballots come in, an election judge will count the ballots, batch them and record the number of ballots received, including those that were returned as undeliverable. The Designated Election Official will maintain a daily log containing the total number of ballots returned.
10. Description of procedures to be used to ensure ballot security at all stages of the process:
The Ballots or ballot labels will contain the warning set forth in Section 1-13.5- l 105(4)(b). The return envelopes will contain the self-affirmation set forth in Section 1-13.5-605(1). The return envelope will have a flap covering the signature of the eligible elector. To protect the elector's privacy, the District will include a secrecy sleeve, with voting instructions, in the mail ballot packet.
When not being processed, ballots packets will be placed in a safe, secure area under the supervision of the Designated Election Official, election judge or person designated by the Designated Election Official. Ballots will not be left unattended while being processed. After processing is complete, ballots will be placed in a safe and secure area. Access to the secure area shall be determined by the Designated Election Official.
A replacement ballot may be requested if the ballot was destroyed, spoiled, lost or not received by the elector. An elector may obtain a ballot if a mail ballot packet was not sent to the elector because the eligibility of the elector could not be determined at the time the mail ballot packets were mailed. The elector requesting the new or replacement ballot must complete a sworn statement specifying the reason for requesting the ballot. A mail ballot packet will not be issued or
(00554385.DOCX I } transmitted to the elector unless a sworn statement requesting the ballot is received on or before the Election.
11. Counting of the mail ballots:
The election judges shall receive and prepare the mail ballots for counting. The counting may begin no sooner than 15 days before the Election (April 17, 2017). The election judges shall take all precautions necessary to ensure the secrecy of the counting procedures. No information concerning the count shall be released by the election judges or any watchers until after 7:00 p.m. on the day of Election. Section 1-13.5-1107, C.R.S.
Dated this gth day of March, 2017.
SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT
By: I Name:
{00554385.DOCX I ) r , 7 PRSRT STD \ I / Valley Sanitation District ATTACHMENT 2 U.S. Postage PAID ( ' 8739 West Coal Mine Ave. Denver, CO Littleton, CO 80123 Permit No 471
A Valley District website: www.colorado.gov/valleysanitation
r111111111 UPCOMING MEETINGS 1111111111111
March 20, 2017, 7-9 p.m. St. James Presbyterian Church 3601 W. Belleview Ave .. Littleton
April 12, 2017, 6:30-7:30 p.m. Centennial Academy of Fine Arts Education School 3660 W. Berry Ave., Littleton Valley Sanitation District 719W.Cat :\. e/t'JI 11J!',Utrlie!otc l,(08012.t
Location of failing interceptor sewer Valley Sanitation District's Interceptor Sewer INTERCEPTOR SANITARY extends 4.5 miles from Belleview Ave. to the Littleton SEWER MAIN Englewood Wastewater Treatment Plant at Dartmouth Ave. and the South Platte River. This pipeline collects and transports wastewater from ALL Valley customers and many customers in surrounding jurisdictions.
19,521 feet of the 21" and 24" sewer pipeline has been lined with polyethylene pipe or a cured-in-place epoxy liner and is in good working condition. Unfortunately, 4,400 feet of the pipeline has not been rehabilitated and is corroding internally, subjecting the pipeline to structural failure and collapse.
The weakened pipe is located within an abandoned landfill between the southwest corner of Centennial Park near South Decatur Street to West Oxford Avenue approximately 400 feet west of the South Platte River (see drawing).
Methane gas and other hydrocarbon gases are
infiltrating the interceptor-at times reaching amounting to $26.44 for a home valued at $200,000 and $39.66 for levels that could result in an explosion or fire. a home valued at $300,000 for a 30-year loan. A 20-year loan would result in a tax increase of approximately $36.06 for a property valued The interceptor is 50 feet deep and is located within a narrow at $200,000 and $63.28 for a property valued at $300,000. 30-foot-wide easement on private property, making operation and maintenance of the pipe extremely dangerous and nearly impossible. Another financing option available to the District is to increase the service charge that is currently billed by the City of Englewood on Failure of the pipeline would result in untreated wastewater Valley customers' sewer bills. This option would result in much higher contamination of private properties and the South Platte River. annual costs and delay the interceptor sewer relocation project several years until sufficient revenue is accumulated. Control of a pipeline failure and resulting discharge would likely take days, and permanent repairs would take weeks and be The Valley Board of Directors is conducting listening sessions tremendously expensive. during February through April at the locations listed below to In order to avoid such an occurrence, Valley Sanitation has present information, respond to questions and elicit citizen input. conducted an extensive analysis of alternatives to move the In addition, the Board invites all Valley customers to attend its pipeline away from the landfill to a location and depth that would monthly meetings 5:00 p.m. on the second Wednesday of each greatly improve the District's ability to effectively operate and month at Centennial Lutheran Church at 3595 W. Belleview Ave. maintain the pipeline. At the conclusion of the listening sessions, the Board will adopt The chosen alternative consists of construction of a sewage lift a plan to eliminate the dangerous situation that confronts the station and 4,700 feet of new sewer pipe in S. Clay St., S. Federal District and its citizens. Your input is encouraged and valued. Blvd., and W. Oxford Ave. at a cost of $2.S million.
In addition to the interceptor sewer relocation project, Valley has a need to rehabilitate eight miles of 8" and 10" corroding concrete pipe at an estimated cost of $1.3 million. For frequent updates, please visit the Valley District website at www.colorado.gov/valleysanitation on this important issue. Valley's current cash reserves available for sewer rehabilitation projects totals $500,000, an amount that is incapable of funding the critical sewer rehabilitation needs of the District. 1111111111 UPCOMING MEETINGS 111111111111111111111111111111111111111111111,
The Valley Board of Directors is pursuing a low interest loan from the Colorado Water Resources and Power Development Authority March 20, 2017, 7-9 p.m. April 12, 2017, 6:30-7:30 p.m. to enable the District to begin the relocation of the very dangerous St. James Presbyterian Church Centennial Academy of interceptor sewer in early 2018. Repayment of the loan would 3601 W. Belleview Ave., Littleton Fine Arts Education School require voter approval of an annual property tax increase .,._ 3660 W. Berty Ave., Littleton ...... ·~· ... ATTACHMENT 3
EXHIBIT A
Summary of COPS Permit Major Issues of Concern (These issues could potentially lead to a request for a adjudicatory hearing if not adequately addressed by the Water Quality Control Division)
For
JANUARY 2017 Following the issuance of the draft Colorado Discharge Permit System permit for the Littleton/Englewood Wastewater Treatment Plant {L/E WWTP), L/E WWTP staff, consultants, and attorneys have coordinated with the Water Quality Control Division (Division) to resolve, if possible, major permit issues in advance of the Division's issuance of the final discharge permit.
The following issues are identified as critical to future permit compliance at the L/E WWTP. If the Division does not address these issues sufficiently in the final permit, substantial costs may be incurred to maintain compliance and/or mitigate the risk of compliance problems, including potential numeric effluent limit violations.
Reserve Capacity
Summarv: In the draft permit, the Division added 5 MGD of capacity to the L/E WWTP discharge permit calculation for the purpose of adjusting assimilative capacity to account for proposed future discharges ! downstream in Denver, near Cherry Creek, and other existing discharges in that geographic area that are converting from general permits to individual permits. This approach does not remove any capacity from the L/E WWTP, but results in more stringent effluent limits for our facility. The reserve capacity approach is a type of watershed-based permitting. While the Division has the authority to model facilities together for common pollutants of concern, it has not historically made allocations for future development, and there are many other nuances that must be considered in such an approach.
Status: We raised multiple concerns and legal issues with the reserve capacity approach in our ~~- . comments on the draft permit. Specifically, we believe the Division lacks the legal authority to set aside assimilative capacity for dischargers that have not yet applied for permits. Additionally, we questioned the Division's need to model facilities together considering the large distance downstream of the future development. We were concerned that the reserve capacity imposes an unfunded mandate on L/E.
Plant staff, attorneys, and consultants have had multiple meetings with Division staff on this issue. Following our most recent meeting with the Division on 2/6/2017, we believe we have resolution on this issue. The Division has received permit applications totaling more than the 5 MGD that was being held in ~ reserve, and is therefore able to model those facilities directly with ours. Depending on the specific requirements that the Division includes in permits for the downstream facilities, it may still be necessary to comment on those permits, particularly if the Division incorporates the L/E design flow into their critical low flow calculations or if nutrient limits are not implemented. We want to ensure that facilities that were not permitted when the Barr-Milton TMDL or the Segment 14 nitrate TMDL were written are not given a free pass, as this could impact our permit limits at some point in the future.
Tiered limits
Summary: The draft permit did not include the three discharge permit flow tiers that were included in the 2009 permit (34 MGD, 42 MGD, and 50 MGD). The tiers allow for less stringent permit limits at lower operating flows. We feel strongly that tiers are warranted based on past permitting practices and the production-based limits language contained in Regulation No. 61.8{2){f){i).
Status: During our meeting on 2/6/2017, the Division indicated that it would maintain tiered limits in our current discharge permit, however, they indicated that tiers can only be provided when the limits at design flow can be met, which could potentially be problematic for the total inorganic nitrogen {TIN)
III-18 January 2017 T limits. It is our position that tiers can also be used for TIN because the compliance schedule will address attainment of limits for all flow tiers. The Division has agreed with this approach in concept.
TIN Modeling and Compliance Schedule Extension
Summarv: The draft permit was issued with TIN limits based on a simple mass-balance approach. This resulted in a more stringent set of monthly limits than the 2009 permit, which had incorporated stream modeling to develop limits. Since the new limits are more stringent than the old ones, the Division included a compliance schedule to provide time to meet them:we have also requested a 3-year extension of the compliance schedule (from a completion date of 2021 to 2024) in order to provide adequate time to contract, design, and construct the necessary plant improvements.
Status: During our meeting on 2/6/2017, the Division indicated that it would likely be open to using the water quality model-derived limits since the model was used in developing the Segment 14 nitrate TMDL, and is therefore defensible. However, due to recent changes in Regulation No. 31, the nitrate standard must be met throughout the stream segment, not just the point of water supply intake; therefore a resegmentation of Segment 14 may be required in'order for modeling to provide relief. The Division did not provide any input regarding the compliance schedule extension request.
Antidegradation Limit for Copper
Summary: The draft permit included a much more stringent limit than the 2009 permit for antidegradation for potentially dissolved copper. L/E previously completed an antidegradation alternatives analysis {AA), which justified a potential limit of 34' µg/L in the 2009 discharge permit. A "report only" requirement was issued at that time based on a reasonable potential analysis. In the current draft permit, the Division reduced the antidegradation limit to 9.9 µg/L, which was set equal to the maximum 2-year rolling average value from samples collected over the preceding 5-year permit cycle. This new limit would also be assessed as a 2-year rolling average.
Status: In our comments on the draft permit, we requested that a less stringent limit, equal to 15.5 µg/L, be assigned in the new discharge permit. This limit was based on a projected trendline over the next permit cycle, and a factor of safety based on a confidence interval approach. We have not received any feedback from the Division on this issue.
Recommendation
If any of the above issues are not adequately addressed in the final permit, the Littleton/Englewood WWTP should request an adjudicatory hearing and administrative stay of the contested terms and conditions of the renewal permit. On the reserve capacity issue, we may also find it necessary to comment on permits that are issued in draft form or final form to other dischargers in the basin, in order to limit the risks of more stringent permit limits affecting our facility.
III-19 January 2017 ATTACHMENT 4
HILL & ROBBINS, DAVID W. ROBBINS P.C. TELEPHONE ATTORNEYS AT LAW ROBERT F. HILL 303 296-8100 1660 LINCOLN STREET, SUITE 2720 PETER J. AMPE DENVER, COLORADO 80264 NATHAN P. FLYNN FAX 303 296-2388 MATTHEW A. MONTGOMERY
E-MAIL [email protected] OF COUNSEL DENNIS M. MONTGOMERY WEBSITE www.hillandrobbins.com
MEMORANDUM
To: Dennis Stowe From: Matt Montgomery and David Robbins Date: January 23, 2017 Re: Ramifications ofreducing the permitted capacity of the Littleton/Englewood Wastewater Treatment Plant.
The Littleton/Englewood Wastewater Treatment Plant (the "Plant") is currently permitted to treat up to 50 million gallons per day (MGD) of wastewater. However, at present, the Plant only treats approximately 25 MGD of wastewater. At a recent joint meeting of the Littleton and Englewood City Councils, the Council Members discussed the possibility of Littleton and Englewood (the "Cities") reducing the pe1mitted capacity of the Plant. 1 You have asked Hill & Robbins to review the possible legal and regulatory ramifications of reducing the permitted capacity of the Plant.2 In our opinion, there are significant legal and regulatory constraints that would prevent the Cities from realizing any significant benefit from reducing the permitted capacity of the Plant.
Tiered limits in the existing discharge permit already afford the same benefits that the Plant would achieve by reducing the permitted capacity.
The administratively continued permit that the Plant is operating under recognizes that the Plant does not actually treat 50 MGD of wastewater. Discharge limits in this permit are calculated based on the use of so-called "flow tiers" (i.e., discharge limits are calculated using the actual design capacity, and two smaller hypothetical design capacities). The lowest of these flow tiers assumes that the design capacity of the Plant is 34 MGD, which was approximately the design capacity of the Plant prior to its most recent expansion. Consequently, the Plant would not realize any benefit if the Cities decided to reduce the permitted capacity of the Plant-since the permit already effectively does this. If a future permit does not recognize flow tiers, a more
1 For clarity, it should be noted that the Plant is currently operating under an administratively continued permit while the Water Quality Control Division ("Division") is in the process of drafting a new permit (which should be completed within the next few months). Both the administratively continued permit and the new permit will authorize the Plant to discharge 50 MGD of wastewater. 2 The permitted capacity of the Plant reflects the amount of wastewater that the Plant is legally authorized to discharge under its permit. This should be distinguished from the design capacity, which reflects the amount of wastewater that the Plant is physically able to treat. At present, both the permitted capacity and the design capacity are 50 MGD. Reducing the permitted capacity of the Plant would have no effect on the design capacity. Dennis Stowe Memorandum Page 2 thorough engineering analysis may be appropriate at that time. But for now, there is nothing to gain by reducing the permitted capacity of the Plant.3
Practical considerations and antidegradation requirements limit the ability to relax discharge limits at reduced permitted capacities.
Even if a future permit did not contain "flow tiers," it is unlikely that the Cities would realize any significant benefits from reducing the permitted capacity of the Plant.
First, practically speaking, many of the discharge limits would not change significantly if the pe1mitted capacity was reduced. This is because discharge limits are calculated based on the low flow conditions in the river. At times of low flow, the Plant effluent comprises a large portion of the streamflow downstream from the Plant discharge location. As a result, many of the discharge limits in the existing permit are the same or very similar at each flow tier. In these cases, little benefit would be gained by reducing the permitted capacity of the Plant.
Second, the antidegradation rule would further limit any potential benefit of reducing the pe1mitted capacity of the Plant. Under the antidegradation rule, except in certain circumstances, the waters into which the Plant discharges "must be maintained and protected at their existing quality." (Regulation 31 § 31.8(l)(b)). Because the river conditions "must be maintained and protected," the Cities will not be able to obtain discharge limits that are more favorable to the Plant than those in the existing permit. Consequently, it is unlikely that any significant savings would be realized by reducing the Plant's permitted capacity.4
There are substantial risks that discharge limits would become more stringent if the Cities decided to re-expand the permitted capacity in the future after de-rating it now.
If the Cities did decide to reduce the pe1mitted capacity of the Plant now, the Cities will likely face significant obstacles if they decide or need to re-enlarge the permitted capacity in the future.
For example, if the Cities decide to reduce and then re-expand the permitted capacity, the discharge limits likely will be ratcheted down by application of the antidegradation rule. As explained above, if the Cities decide to reduce the permitted capacity of the Plant now, they will not be able to obtain more favorable discharge limits because of the antidegradation rule. Instead, the existing discharge limits will be applied to the smaller discharge. Then, if the Cities decide to re-enlarge the pe1mitted capacity, because of this same rule, the discharge limits will be decreased to maintain the conditions associated with the smaller discharge, which will require more treatment per MGD-increasing the costs of operating the Plant.
3 The draft of the new permit that the Division is working on did not contain flow tiers. In written comments to the Division, the Plant requested that the flow tiers be reinstated. It is difficult to say whether the Division will grant this request. Accordingly, the next section addresses 50 MGD permit without flow tiers. 4 The anti-backsliding rule might also have this same effect. Under the anti-backsliding rule, except in limited circumstances, "a pennit may not be renewed, reissued; or modified to contain effluent limitations which are less stringent than the comparable effluent limitations in the previous permit." 33 U.S.C. § 1342( o )(1 ). Because the effluent limitations may not be "less stringent," this rule also constrains the Plant's ability to obtain discharge limits that are more favorable than those in the existing permit. Dennis Stowe Memorandum Page 3
In addition, the available assimilative capacity in Segment 14 of the South Platte River presents another concern. As the ongoing renewal of the Plant's permit demonstrates, there are a number of new discharges along Segment 14 of the South Platte River-primarily due to the dewatering of new underground parking facilities in Denver-that could be allocated some of the assimilative capacity that has already been allocated to the Plant. If the Cities decrease the permitted capacity of the Plant, some, or all, of the assimilative capacity freed up, likely will be allocated to these new discharges. Consequently, if and when the Cities need to re-expand the Plant in the future, there likely will be less assimilative capacity available to the Plant at that time--resulting in more-stringent treatment requirements for the Plant's effluent. As a result, if the Cities reduce the permitted capacity of the Plant now, it will likely be significantly more expensive to increase the permitted capacity in the future. Additionally, the assumptions or methods used for calculating some limits may be different in the future; for example, if the Plant applies to re-expand the discharge capacity, it is conceivable that the Plant will be modeled together with the new downstream dischargers, further limiting allowable discharge limits.
It is important for the Cities to be aware that they could face significant legal consequences if the City Councils decide to reduce the permitted capacity of the Plant.
There are also potential legal liabilities if the Cities decide to reduce the permitted capacity of the Plant.
The foremost is that, in addition to treating the wastewater produced by the Cities, the Plant also treats wastewater produced by nineteen special districts (the "Connector Districts") in Arapahoe, Jefferson, and Douglas Counties pursuant to contracts between one of the Cities and the Connector Districts.5 These contracts, many of which were renewed in 2013, guarantee that the Plant will treat all wastewater from the Connector Districts, including any additional wastewater generated by population growth.
If the Cities decide to reduce the pem1itted capacity of the Plant, the Plant may be unable to accommodate the future growth in the Connector Districts. Although the contracts with the Connector Districts are limited in duration, and thus theoretically tern1inatable at some point in the future, the Plant's refusal to treat the wastewater from the Connector Districts would likely result in significant impacts on public-health, safety, and the environment; therefore, it is unclear whether the Cities would ever actually be able to extract themselves from the responsibility to treat wastewater from the Connector Districts. At a minimum, pursuant to Regulations 22.8(2)(c) and 22.9, the Division will perform an extensive review of the decision to down-rate the Plant and the Cities will be required to demonstrate that there are no "[f]oreseeable potential adverse impacts on public health, welfare, and safety." Moreover, if at some point in the future, the Cities are unable to treat all the waste from the Connector Districts (or need to impose wastewater caps) because of the decision to down-rate the Plant, the Cities likely will face legal action from the Connector Districts. Before any decision to down-rate the Plant can be made, the
5 We have not reviewed these contracts extensively in preparation of this memo, but, based on a cursory review, it seems clear that these contracts were entered into by the Cities and the Connector Districts in reliance on the fact that the Plant had sufficient excess permitted capacity to accommodate any reasonably foreseeable population growth in the Connector Districts. Dennis Stowe Memorandum Page 4
Cities will need to retain an engineering firm to quantify the amount of additional capacity (with a margin for safety) that is required to treat the reasonably foreseeable growth in the Connector Districts.
Conclusion
None of the observations above categorically prevent the Cities from seeking to reduce the permitted capacity of the Plant. It could be requested now or in the future, and can be independent of a discharge permit renewal process. However, there is no certainty that any permitted capacity foregone could be easily or inexpensively restored in the future. It is our advice that the Cities should continue to maintain a permit to treat 50 MGD of wastewater, which is the existing design capacity of the Plant. There do not appear to be sufficient legal or regulatory benefits to justify a down-grade. ATTACHMENT 5
Mar. 13, 2017, by Joey Bunch, ColoradoPolitics.com Seven Western Colorado legislators have a message for Gov. John Hickenlooper, but really it's for the Front Range: the West Slope is tapped out. "An abundance of additional West Slope water available to the Front Range is an illusion," says the letter to Hickenlooper signed bySens. Randy Baumgardner, Don Coram and Ray Scott, as well as Reps. Marc Catlin, Bob Rankin, Dan Thurlow and Yeulin Willett. The letter was obtained by ColoradoPolitics.com.
The seven Republican lawmakers call on the state to get moving on the conservation efforts, including water-wise land-use planning, to slow the Front Range's steady drain on West Slope water. That sounds awfully green coming from such well-known conservatives. What's next? Baumgardner in Birkenstock sandals? "These actions need to happen as soon as possible to protect our economy and to avoid any new transmountain diversion projects," their letter states. "We believe the Colorado River is at a tipping point where an additional transmountain diversion could have both immediate and long-term negative impacts on our economy." Here is the full text of the letter. Dear Governor Hickenlooper, On the eve of the release of Colorcrdo's ivater Plan in late 2015, we wrote to yuu urging that the Plan and its implernentotion represent the interests cf the Slat'c in its entirety,. honor Color·ado :i;;; agricultural heritage and protect economic interests that rely on heulth_i1,./loLvinq rivers. One yedr loter, we write agoin conceJ'ned olJout the negative conseqw, nces cf ove1 -allocatim1 r~{ vVest Slo;A~ water to ow· local ccouomy and, by extension, lhe Stale. l~ater is thefcnmdation Presidential Executive Order on Reducing Regulation and Controlling Regulatory Costs EXECUTIVE ORDER REDUCING REGULATION AND CONTROLLING REGULATORY COSTS By the authority vested in me as President by the Constitution and the laws of the United States of America, including the Budget and Accounting Act of 1921, as amended (31 U.S.C. 1101 et seq.), section 1105 of title 31, United States Code, and section 301 of title 3, United States Code, it is hereby ordered as follows: Section 1. Purpose. It is the policy of the executive branch to be prudent and financially responsible in the expenditure of funds, from both public and private sources. In addition to the management of the direct expenditure of taxpayer dollars through the budgeting process, it is essential to manage the costs associated with the governmental imposition of private expenditures required to comply with Federal regulations. Toward that end, it is important that for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process. Sec. 2. Regulatory Cap for Fiscal Year 2017. (a) Unless prohibited by law, whenever an executive department or agency (agency) publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed. (b) For fiscal year 2017, which is in progress, the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized this year shall be no greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget (Director). (c) In furtherance of the requirement of subsection (a) of this section, any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least two prior regulations. Any agency eliminating existing costs associated with prior regulations under this subsection shall do so in accordance with the Administrative Procedure Act and other applicable law. (d) The Director shall provide the heads of agencies with guidance on the implementation of this section. Such guidance shall address, among other things, processes for standardizing the measurement and estimation of regulatory costs; standards for determining what qualifies as new and offsetting regulations; standards for determining the costs of existing regulations that are considered for elimination; processes for accounting for costs in different fiscal years; methods to oversee the issuance of rules with costs offset by savings at different times or different agencies; and emergencies and other circumstances that might justify individual waivers of the requirements of this section. The Director shall consider phasing in and updating these requirements. Sec. 3. Annual Regulatory Cost Submissions to the Office of Management and Budget. (a) Beginning with the Regulatory Plans (required under Executive Order 12866 of September 30, 1993, as amended, or any successor order) for fiscal year 2018, and for each fiscal year thereafter, the head of each agency shall identify, for each regulation that increases incremental cost, the offsetting regulations described in section 2(c) of this order, and provide the agency's best approximation of the total costs or savings associated with each new regulation or repealed regulation. (b) Each regulation approved by the Director during the Presidential budget process shall be included in the Unified Regulatory Agenda required under Executive Order 12866, as amended, or any successor order. (c) Unless otherwise required by law, no regulation shall be issued by an agency if it was not included on the most recent version or update of the published Unified Regulatory Agenda as required under Executive Order 12866, as amended, or any successor order, unless the issuance of such regulation was approved in advance in writing by the Director. (d) During the Presidential budget process, the Director shall identify to agencies a total amount of incremental costs that will be allowed for each agency in issuing new regulations and repealing regulations for the next fiscal year. No regulations exceeding the agency's total incremental cost allowance will be permitted in that fiscal year, unless required by law or approved in writing by the Director. The total incremental cost allowance may allow an increase or require a reduction in total regulatory cost. (e) The Director shall provide the heads of agencies with guidance on the implementation of the requirements in this section. Sec. 4. Definition. For purposes of this order the term "regulation" or "rule" means an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or to describe the procedure or practice requirements of an agency, but does not include: (a) regulations issued with respect to a military, national security, or foreign affairs function of the United States; (b) regulations related to agency organization, management, or personnel; or (c) any other category of regulations exempted by the Director. Sec. 5. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect: (i) the authority granted by law to an executive department or agency, or the head thereof; or (ii) the functions of the Director relating to budgetary, administrative, or legislative proposals. (b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations. (c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. DONALD J. TRUMP THE WHITE HOUSE, January 30, 2017. ATTACHMENT 7 Presidential Executive Order on Enforcing the Regulatory Reform Agenda EXECUTIVE ORDER ENFORCING THE REGULATORY REFORM AGENDA By the authority vested in me as President by the Constitution and the laws of the United States of America, and in order to lower regulatory burdens on the American people by implementing and enforcing regulatory reform, it is hereby ordered as follows: Section 1. Policy. It is the policy of the United States to alleviate unnecessary regulatory burdens placed on the American people. Sec. 2. Regulatory Reform Officers. (a) Within 60 days of the date of this order, the head of each agency, except the heads of agencies receiving waivers under section 5 of this order, shall designate an agency official as its Regulatory Reform Officer (RRO). Each RRO shall oversee the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms, consistent with applicable law. These initiatives and policies include: (i) Executive Order 13771 of January 30, 2017 (Reducing Regulation and Controlling Regulatory Costs), regarding offsetting the number and cost of new regulations; (ii) Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), as amended, regarding regulatory planning and review; (iii) section 6 of Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review), regarding retrospective review; and (iv) the termination, consistent with applicable law, of programs and activities that derive from or implement Executive Orders, guidance documents, policy memoranda, rule interpretations, and similar documents, or relevant portions thereof, that have been rescinded. (b) Each agency RRO shall periodically report to the agency head and regularly consult with agency leadership. Sec. 3. Regulatory Reform Task Forces. (a) Each agency shall establish a Regulatory Reform Task Force composed of: (i) the agency RRO; (ii) the agency Regulatory Policy Officer designated under section 6(a)(2) of Executive Order 12866; (iii) a representative from the agency's central policy office or equivalent central office; and (iv) for agencies listed in section 901(b)(1) of title 31, United States Code, at least three additional senior agency officials as determined by the agency head. (b) Unless otherwise designated by the agency head, the agency RRO shall chair the agency's Regulatory Reform Task Force. (c) Each entity staffed by officials of multiple agencies, such as the Chief Acquisition Officers Council, shall form a joint Regulatory Reform Task Force composed of at least one official described in subsection (a) of this section from each constituent agency's Regulatory Reform Task Force. Joint Regulatory Reform Task Forces shall implement this order in coordination with the Regulatory Reform Task Forces of their members' respective agencies. (d) Each Regulatory Reform Task Force shall evaluate existing regulations (as defined in section 4 of Executive Order 13771) and make recommendations to the agency head regarding their repeal, replacement, or modification, consistent with applicable law. At a minimum, each Regulatory Reform Task Force shall attempt to identify regulations that: (i) eliminate jobs, or inhibit job creation; (ii) are outdated, unnecessary, or ineffective; (iii) impose costs that exceed benefits; (iv) create a serious inconsistency or otherwise interfere with regulatory reform initiatives and policies; (v) are inconsistent with the requirements of section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516 note), or the guidance issued pursuant to that provision, in particular those regulations that rely in whole or in part on data, information, or methods that are not publicly available or that are insufficiently transparent to meet the standard for reproducibility; or (vi) derive from or implement Executive Orders or other Presidential directives that have been subsequently rescinded or substantially modified. (e) In performing the evaluation described in subsection (d) of this section, each Regulatory Reform Task Force shall seek input and other assistance, as permitted by law, from entities significantly affected by Federal regulations, including State, local, and tribal governments, small businesses, consumers, non-governmental organizations, and trade associations. (f) When implementing the regulatory offsets required by Executive Order 13771, each agency head should prioritize, to the extent permitted by law, those regulations that the agency's Regulatory Reform Task Force has identified as being outdated, unnecessary, or ineffective pursuant to subsection (d)(ii) of this section. (g) Within 90 days of the date of this order, and on a schedule determined by the agency head thereafter, each Regulatory Reform Task Force shall provide a report to the agency head detailing the agency's progress toward the following goals: (i) improving implementation of regulatory reform initiatives and policies pursuant to section 2 of this order; and (ii) identifying regulations for repeal, replacement, or modification. Sec. 4. Accountability. Consistent with the policy set forth in section 1 of this order, each agency should measure its progress in performing the tasks outlined in section 3 of this order. (a) Agencies listed in section 901 (b)(1) of title 31, United States Code, shall incorporate in their annual performance plans (required under the Government Performance and Results Act, as amended (see 31 U.S.C. 1115(b))), performance indicators that measure progress toward the two goals listed in section 3(g) of this order. Within 60 days of the date of this order, the Director of the Office of Management and Budget (Director) shall issue guidance regarding the implementation of this subsection. Such guidance may also address how agencies not otherwise covered under this subsection should be held accountable for compliance with this order. (b) The head of each agency shall consider the progress toward the two goals listed in section 3(g) of this order in assessing the performance of the Regulatory Reform Task Force and, to the extent permitted by law, those individuals responsible for developing and issuing agency regulations. Sec. 5. Waiver. Upon the request of an agency head, the Director may waive compliance with this order if the Director determines that the agency generally issues very few or no regulations (as defined in section 4 of Executive Order 13771 ). The Director may revoke a waiver at any time. The Director shall publish, at least once every 3 months, a list of agencies with current waivers. Sec. 6. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect: (i) the authority granted by law to an executive department or agency, or the head thereof; or (ii) the functions of the Director relating to budgetary, administrative, or legislative proposals. (b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations. (c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. ATTACHMENT 8 THE WHITE HOUSE Office of the Press Secretary FOR IMMEDIATE RELEASE February 28, 2017 EXECUTIVE ORDER Restoring the Rule of Law, Federalism, and Economic Growth BY REVIEWING the "Waters of the United States" Rule By the authority vested in me as President by the Constitution and the laws of the United States of America, it is hereby ordered as follows: Sect{on 1. Policy. It is in the national interest to ensure that the Nation's navigable waters are kept free from pollution, while at the same time promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles of the Congress and the States under the Constitution. Sec. 2. Review of the Waters of the United States Rule. (a) The Administrator of the Environmental Protection Agency (Administrator) and the Assistant Secretary of the Army for Civil Works (Assistant Secretary) shall review the final rule entitled "Clean Water Rule: Def ini ti on of 'Waters of the United States, '" 8 0 Fed. Reg. 37054 (June 29, 2015), for consistency with the policy set forth in section 1 of this order and publish for notice and comment a proposed rule rescinding or revising the rule, as appropriate and consistent with law. (b) The Administrator, the Assistant Secretary, and the heads of all executive departments and agencies shall review all orders, rules, regulations, guidelines, or policies implementing or enforcing the final rule listed in subsection (a) of this section for consistency with the policy set forth in section 1 of this order and shall rescind or revise, or publish for notice and comment proposed rules rescinding or revising, those issuances, as appropriate and consistent with law and with any changes made as a result of a rulemaking proceeding undertaken pursuant to subsection (a) of this section. (c) With respect to any litigation before the Federal courts related to the final rule listed in subsection (a) of this section, the Administrator and the Assistant Secretary shall promptly notify the Attorney General of the pending review under subsection (b) of this section so that the Attorney General may, as he deems appropriate, inform any court of such review and take such measures as he deems appropriate concerning any such litigation pending the completion of further administrative proceedings related to the rule. Sec. 3. De fini ti on of "Navigable Waters" in Future Rulemaking. In connection with the proposed rule described in section 2(a) of this order, the Administrator and the Assistant Secretary shall consider interpreting the term ''navigable waters," as defined in 33 U.S.C. 1362(7), in a manner consistent with the opinion of Justice Antonin Scalia in Rapanos v. United States, 547 U.S. 715 (2006). Sec. 4. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect: (i) the authority granted by law to an executive department or agency, or the head thereof; or (ii) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals. (b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations. (c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. DONALD J. TRUMP THE WHITE HOUSE, February 28, 2017. ### Page No 3/J,2017 PLATTE CANYON MONTH END TAP REPORT DATEISSUE ADDRESS BLOCK LOT SUB WATER SEWER TYPE BUILDER STATUS WTRFEE SWRFEE ADMFEE CHECKNO ~tdi j e>.bo 'i t-A ti o. oo Page No. 3/l/2017 SOUTHWEST METROPOLITAN MONTH END TAP REPORT BLOCK LOT gm WA~R SEWER TYPE STATUS \VTRFEE SWRFEE ADMFEE CHECK.NO 2/6,2017 8160 W. Coal Mine Ave. Miscellaneous l.00 co 55,500.00 21,725.00 0.00 1045 2/8/2017 9883 W. Chatfield Ave. Ken Caryl Retail Center 4 J.00 CRT 28,000.00 12,100.00 0.00 162590/162589 2/8/2017 9670 W. Coal Mine Ave. Miscellaneous 94 co 4 0.00 0.00 0.00 NO FEE 2/10/2017 11879 W. Portland Dr. 34 Foothills Overall Campus LOO RS 1 7,000.00 1,100.00 0.00 117507 2/13/2017 6686 S. Wadsworth Blvd. Woodmar Comers PR! 14,000.00 0.00 0.00 2000010064 2113/2017 6686 S. Wadsworth Blvd Woodmar Comers 4 1.00 CRT 28,000.00 12,100.00 0.00 2000010064 TOTALS 132,500.00 47,025.00 0.00 wo.\'t.:< Sew€J<' SOUTHWEST METROPOLITAN WATER & SANITATION DIST. SOUTHWEST METROPOLITAN WATER& SANITATION DIST. WATER TAP REVENUE REPORT FOR FEBRUARY2017 SEWER TAP REVENUE REPORT FOR FEBRUARY 2017 •-m:.oii·_.,_ ..... 'll IH'J,001 •ua,soo •114'1,00J • •1132 , 500• SOUfDWESTMElllOPOLITANWATER&SANITATIONDIST. SOUTHWEST METROPOLITAN WATER& SANITATION DIST. WATER TAP SALES REPORT FORFEllRUARY 2017 SEWER TAP SALES REPORT FOR FEBRUARY2017 -...... " .--...... o. oo o.oo .,,_, 0 . 00 o.oo -...., 0 . 00 o.oo ATTACHMENT 10 Patrick Fitzgerald From: Patrick Fitzgerald Sent: Monday, March 06, 2017 9:09 AM To: '[email protected]' Subject: FW: Increase of "sewer fees" and Utility Billing, Sewer, Storm Draining Billing Questions Dear Ms. Hutt, Thank you for your email. Southwest Metropolitan charges a $3.00 per month service charge because the District owns, operates and maintains the water and sewer mains that deliver water to your home from our point of connection to Denver Water's system, and owns, operates, and maintains all of the sewer mains that collect wastewater from your home for delivery to the Littleton Englewood Wastewater Treatment Plant for processing. The District went approximately 20 years without charging residents for these valuable services as it operated off the interest generated from its capital reserve fund. Unfortunately, the District found it necessary to rehabilitate the majority of its interceptor sewer system at a cost of over $12 million dollars over the past few years. In addition, interest rates dropped significantly over the past ten years. These events left the District in a position of being unable to fund operation and maintenance costs that are critically necessary to assure you and your neighbors of delivery of safe, reliable water and wastewater services. The $3.00 per month paid by residents for these services is by far the lowest charge for these services paid by any utility customer in the Colorado Front Range. Information on the implementation of the fee and the current year increase was prominently presented in the District's newsletter that is mailed quarterly to all residents, and on the District's web site as news articles. As referenced above, Southwest Metropolitan receives no revenue from the sewer bill you receive from the City of Littleton. The City bills Southwest Metropolitan residents directly for wastewater treatment services. Littleton has discretion to determine the rate structure used so long as the charges are fair, reasonable and equitable to all users. While there are many utilities that charge wastewater charges base on water consumption, many also charge a flat fee based on the fact that the vast majority of the treatment providers costs are fixed and do not vary with the amount of wastewater treated. At any rate, your concern regarding the rate structure used by Littleton is more properly directed to the City. The date of the District Board meetings is displayed on the Home page of the District's website (third paragraph) and is always highlighted on the calendar that appears on the Home page. In addition, the agenda for each meeting is posted on the website a minimum of three days prior to each meeting. The District's newsletter also references the regular Board meeting date as being the fourth Friday of each month at 8:30 am., and the location at 8739 W. Coal Mine Ave. Again, thank you for your email and please feel free to call me or email me if you have questions or seek additional information. Patrick Fitzgerald 303-979-2333 [email protected] -----0 rigina I Message---- From: Barrie Brinkley Sent: Monday, March 06, 2017 8:29 AM To: Patrick Fitzgerald Subject: FW: Increase of "sewer fees" and Utility Billing, Sewer, Storm Draining Billing Questions From website 1 Barrie Brinkley Website and Document Administrator Platte Canyon Water and Sanitation District Office: 303-979-2333 x 103 Direct: 720-726-5027 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ No trees were harmed in the sending of this email, but a few electrons were inconvenienced. -----Original Message----- From: Marne Tutt [mailto:[email protected]] Sent: Sunday, March 05, 2017 9:11 PM To: SWlnfo To Southwest Water and City of Littleton- Southwest Metro Water: I am very offended and angry that you have increased your sewer fee by 300% ($1 to $3) OR even charge your customers in the first place for this 'sewer fee' through my Denver Water bill. And what does Denver Water charge you for collection of this Sewer Fee? I read your 2015 Audit and I cannot find anywhere in that document a listing for "Denver Water Collection Fees." Now my biggest problem with your company: Why do I have to pay the same annual Sewer & Storm Drain fee as my next door neighbors, who have two people living in their house or the family across the street that have four people living in their house? As far as I know, I am the only single person living on my block and all the rest of the neighbors have from 2 to 7 people living in their house and using your sewer services. So clearly, I am paying for the sewer water of all my neighbors and they are getting free sewer service. I use only 3,000 gallons (& never more) of Denver Water per month during the winter months but my neighbors use much more since they have more people living in their house. Why can't you charge for sewer service like they do in The City and County of Denver? They charge each household by the average gallons used in December, January & February. That is much more equitable and logical, especially for this single person household. You clearly have a relationship with Denver Water now, since they collect your other service fees, so they can very easily give you each households average winter water use and your could charge based on that use. Again just like Denver Water does in The City and County of Denver. On your website, I could not find a schedule of future monthly meetings. Please give me date, time and location of your next meetings so that I may attend and orally express my opinion in person. Thank you, Marne H. Tutt 8031 S Upham Street Littleton, CO 80128 [email protected] 2 Platte Canyon and Southwest Metropolitan Water and Sanitation Districts Operation and Maintenance Summary Report February, 2017 Service Interruptions - Water Platte Canyon LOCATION: 7409 W. Fremont Ave. DATE: February 22, 2017 PROBLEM: Electrolysis TYPE: 2” Galvanized Blow-Off Assembly AGE: 1972 OUTAGE: Customers: Fourteen Duration: Seven Hours COSTS: Permit: $ 175.00 Contractor repair: $4,769.70 Asphalt/Concrete: $ 850.00 District: $ 540.56 Total: $6,335.26 COMMENTS: Corrosion of galvanized piping. Replaced the entire assembly with brass and copper fittings and piping. Service Interruptions - Sewer Platte Canyon No sewer service interruptions this reporting period. Southwest Metropolitan No sewer service interruptions this reporting period. Page 1 of 8 General Operations Information Platte Canyon - Sewer Notice Letters Zero sewer notice letters were sent to customers warning of a potential problem as a result of root intrusion. Southwest Metropolitan - Sewer Notice Letters Zero sewer notice letters were sent to customers warning of a potential problem as a result of root intrusion. Remedial Water Repairs (PC & SWM) October, 2016 – Water remedial repairs are complete for the remainder of the year. Additional items are budgeted for repair in 2017. November, 2016 - Water remedial repairs will resume late spring of next year. December, 2016 – No information this reporting period. January, 2017 – No information this reporting period. February, 2017 – A list is being compiled and will be sent to C&L to begin scheduling repairs for mid-March. District Facilities Status Scott J. Morse Pump Station (PC) Reconstruction Project October, 2015 - Staff met with Dewberry and several subcontractors to review the project and finalize any questions for the design. November, 2015 - Tony and I met with Chad and Sam of Dewberry to discuss the progress of the design. Many factors were discussed, some needing additional information from staff. Future reports will reveal the progress of the design project. December, 2015 - Discussed installing direct-bury butterfly valves versus in vaults. We will need to supply water by other sources during construction. Tony and I met with Denver Water and discussed the plan to provide water from another pressure zone. Strict coordination will occur during these events and will allow adequate water service and fire protection for all customers during construction. Tony and Armando met with Dewberry Page 2 of 8 and their pothole contractor to confirm the location of other utilities. This information is needed to continue the design and address any conflicts. January, 2016 – Dewberry submitted 60% submittal design drawings. Staff is reviewing and commenting as design advances. Denver Water is performing a courtesy design review. February, 2016 – Staff received 90% submittal design from Dewberry. Staff is reviewing the nearly completed design documents. Advertising is projected for mid-April and bid opening is scheduled for April 28, 2016. March, 2016 – No information this reporting period. April, 2016 – Mandatory pre-bid meeting is scheduled for May 18, 2016. May, 2016 – Bid opening was held May 24, 2016 at 4:00 p.m. There were four contractors present for the opening: Glacier, Archer Western, Asian, and Stanek. The low bid was Glacier for $1,097,880. June, 2016 – A preconstruction meeting will be held sometime early or mid-June. July, 2016 – Two meetings were held this month, the pre-construction meeting and another meeting coordinating the sequence each category will be addressed. A significant amount of time was spent planning and notifying customers for the valve cut-in at W. Ken Caryl Ave. and S. Webster St. This valve is required to accommodate adequate water pressure during construction. Approximately three hundred residents’ pressure was reduced during the installation. The project was completed in just one day and we received only one customer call. August, 2016 – No activity to report this period. September, 2016 – Staff is preparing for the pressure zone realignment to accommodate the demolition of the pump station. It is scheduled for October 3, 2016. October, 2016 – The pump station was taken off-line on October 3, 2106. The pressure zone was re-aligned as explained in the past. Currently, the contractor is demolishing all piping and electrical within the pump station. November, 2016 – Construction is progressing. A majority of the new discharge piping has been installed. As of the date of this report internal piping is being assembled. An update will be provided in Tony’s construction report. December, 2016 – Most of the suction piping has been installed. A new electric service has been installed and we are waiting for Xcel to install the new electric meter. Tony’s report will have more information. Page 3 of 8 January, 2017 – Glacier is progressing completing exterior and interior piping. Flash Fill accidentally got into the new suction main. They had to re-excavate and replace approximately twelve feet of pipe. The project is still on schedule and expect to begin testing of all components late February. February, 2017 – Piping was disinfected and flushed. Various testing for leaks and functions were completed. Electrical components and controls will be tested soon. SCADA amendments will have to be completed before station can be returned to service. Fire System Communication Failure January, 2016 – After the installation of a replacement fire panel, problems communicating with Tyco Integrated Systems main office have occurred. At their recommendation an additional phone line was installed and did not resolve the communication error. Tyco is proposing to install a cellular line at no cost to the district. I am waiting for Tyco’s proposal as to reestablishing communication. February, 2016 – I’ve had several conversations with Tyco to correct this issue. They assured me a proposal will be presented mid-March. March, 2016 – I am still working with Tyco resolving the communication error. More information will be provided in next month’s report. April, 2016 – It is very difficult working with Tyco to resolve this issue. I have finally made it to a supervisor that promises to meet me at the site and come to a final resolve of this issue. May, 2016 – No information to report this period. June, 2016 – Another vendor meet was set for Century Link and Tyco to discuss and finally troubleshoot/correct the issue. They couldn’t determine the reason for not being able to call out. Tyco took the fire panel with them to test it off-site (for the fifth time). July, 2016 – The cause of the communication failure was finally revealed. Once the panel was re-installed and tested we did not have communication. We shut off the pump station controls and it began to communicate. After all this time, the problem is electrical interference with the extremely sensitive fire panel. Tyco is going to propose a resolve to the issue. As of the date of this report, I have not heard anything. August, 2016 – Tyco presented a proposal late in the month. The cost to upgrade is just over $2,000.00. An internal meeting will be set to discuss the repair. As late as it is I intend to propose to staff we postpone the fire panel installation until after the new equipment is in place. Also, I want to discuss it with Dewberry to incorporate it during construction. Page 4 of 8 September, 2016 – Nothing new to report this period. Waiting for progress of the reconstruction and the engineer and Tyco will meet to accommodate the re-installation of the fire panel and security panel. October, 2016 – Nothing to report this period. November, 2016 – District staff and Dewberry will work with Tyco during the final stages of construction to re-establish both fire and security within the pump station. This will take place sometime in late February or March. December, 2016 – We are waiting for the new phone lines to be installed before we can move forward. January, 2017 – Still waiting on phone line installation. February, 2017 – The new phone lines were installed and Tyco connected both fire and security to the control panels. Systems were tested and seem to function as expected. Some minor wiring repairs will be completed damaged during construction specifically installation of the new doors. Meetings/Training Maintenance Staff Meeting Monthly staff and safety meeting was held on Wednesday, February 8, 2017. These staff meetings are held monthly to discuss operational, personnel, and safety matters. Operator Certification / Training February, 2017 All Operations staff attended a corrosion workshop held at the district office on February 8, 2017. Armando, Bruce, Justin, and Mike attended a two-day workshop at Alameda Water and Sanitation District February 27 & 28, 2017. The course was for the accrual of training units for distribution and collection. General Information Peakview and Wadsworth Water Main Reconstruction (SWM) Page 5 of 8 2015 - Staff has been planning for some time to abandon the 10” water line in S. Wadsworth Blvd. parallel to a 16” water line. The 10” is redundant and is not necessary anymore. C&L connected the north end to the 16” at W. Arbor Dr. The contractor for the SCL Hospital disconnected the south end at W. Coal Mine Ave. One more reconnection will occur at W. Peakview Dr. then, the line will be completely out of service. The work performed at W. Arbor Pl. and S. Wadsworth Blvd. was more expensive than anticipated due to unforeseen circumstances. January, 2016 - The planned reconnection at W. Peakview Dr. has been budgeted for 2016 under remedial repairs. February, 2016 – Staff has begun developing a scope of work to send to various contractors for bids. Staff expects to complete this project late spring or early summer. March, 2016 – No information this reporting period. April, 2016 – I am working with the assistant manager to prepare a RFP so this project can be completed in the very near future. May, 2016 – No information this reporting period. June, 2016 – Operations staff have begun working on a plan and provide the assistant manager information so he can request proposals for the final re-connection. July, 2016 – I have instructed Armando Quintana to provide information to Ashley Dalton to move forward with an R.F.P. August, 2016 – Armando has been working obtaining proposals. We expect to have three by the end of the month and submit a request to internal staff for review. September, 2016 – Staff has obtained two proposals and is anxious to receive the third proposal. Staff intends to present a recommendation to the board at the October meeting. October, 2016 – Staff continues to acquire the third proposal from Levi. Tony Cocozzella is working with RD Pipeline to obtain a fourth proposal. Information may be provided at the November meeting. November, 2016 – Tony is still attempting to obtain the additional proposal. December, 2016 – No information to report this period. January, 2017 – After receiving three bids for the project it was revealed the project is above the cost assumed. Staff will work with an engineer to develop design specifications and drawings. This project will be budgeted and constructed in 2018. February, 2017 – Staff has requested Tim Flynn prepare a design engineering contract with Rich Cassens. Page 6 of 8 S.C.A.D.A. Communication System Upgrade February, 2016 – Staff has been working to obtain a proposal to upgrade the SCADA communication system. The current system is very old working on an analog two-wire system hosted by Century Link. Due to the age and support of the old system becoming extinct, it is necessary to have a reliable circuit monitoring the pump stations and sewer flow monitoring sites. March, 2016 – The assistant manager presented a proposal to the district manager to move forward with Browns Hill Engineering to provide an assessment of the current system and propose a new system. We expect this to be a two-phase project. First, to upgrade the communication (DSL, cable, radio) from the two-wire analog. Second, to upgrade all the controllers to current technologies. The district manager approved this project to proceed. April, 2016 – The assistant manager is nearly completed the paperwork for this project to proceed. Browns Hill will be scheduled soon to perform the assessment of the circuit. May, 2016 – Browns Hill has visited all the sites twice this month. We expect a proposal from them mid-June and their recommendations for the upgrade. June, 2016 – Browns Hill provided some documentation for the project and staff has reviewed what was provided. It is incomplete and the assistant manager and I will request a meeting with them to obtain more information. July, 2016 – The assistant manager and I met with Browns Hill and discussed their proposal. Under the original intent, we were going to upgrade just the communication vehicle and later upgrade the controllers. Browns Hill determined that cannot be accomplished as originally thought. In the very near future we will present a proposal to the district manager and eventually to the board of directors a recommendation for a full upgrade of the SCADA system requesting funds for the 2017 budget. August, 2016 – Staff has reviewed the amended proposal from Browns Hill. Funds will be recommended for the 2017 budget. More information will be provided during the October board meeting. September, 2016 – A recommendation for funds in the 2017 budget will be presented during the October board meeting. Any questions may be addressed at that time. October, 2016 – No information this reporting period. November, 2016 – Staff will begin discussing the project with Browns Hill in December and expected to start the work early spring. Page 7 of 8 December, 2016 – No information this reporting period. January, 2017 – No information this reporting period. February, 2017 – No information this reporting period. Service Contracts Bow Mar February, 2017 Completed seven meter readings. Responded to two customer service requests. Completed twelve utility locate requests. Columbine February, 2017 Performed weekly and monthly lift station maintenance. Completed one customer service request. Completed four utility locate requests. Completed 2,189 feet of television inspections. Lochmoor February, 2017 No information this reporting period. Valley February, 2017 Attended monthly board meeting. Completed two customer service requests. Completed thirteen utility locate requests. Completed 9,075 feet of television inspections. Completed 1,508 feet of root cutting. S:\data\WPDOCS\DOCUMENTS\Word Files\PC-SWM O&M BOARD AGENDA SUMMARY.docx Page 8 of 8 PLATTE CANYON WATER AND SANITATION DISTRICT OPERATIONS & MAINTENANCE REPORT FEBRUARY, 2017 2/28/2017 (FINAL) Accomplishments Man-hours Job Code Description Scheduled Completed % Scheduled Completed O.T. % 1101 General Water 0 0 8.00 0.00 0% 1102 Pump Station 4 4 100% 5.00 0.00 0% 1103 Customer Service 5 6.00 2.50 4.50 42% 1104 Utility Location 36 4.00 21.00 525% 1105 Valve Inspection / Maintenance 0 0 0% 0.00 0.00 0% 1106 Hydrant Inspections / Maintenance 0 0 0% 0.00 0.00 0% 1116 Hydrant Painting 0 0 0% 0.00 0.00 0% 1107 Districbution System Flushing / Testing 4 4 100% 1.00 1.25 125% 1108 P.R.V. Inspections / Maintenance 0 0 0% 0.00 0.00 0% 1109 Air-Vac Inspections / Maintenance 0 0 0% 0.00 0.00 0% 1110 Valve & Hydrant Repair 5 3 60% 23.00 11.25 49% 1120 Pressure Monitoring 0 0 0% 0.00 0.00 0% 1130 Water Break Repair 0 0.00 1151 Construction Inspection / Tesing (Warranty) 0 0 0% 0.00 0.00 0% 1160 Overlay Operations - Water 0 0 0% 0.00 1201 General Sewer 0% 6.00 0.00 0% 1202 Lift Station 1203 Customer Service 4 6.00 1.00 17% 1204 Utility Location 20 4.00 4.25 106% 1205 Hydraulic Main Cleaning 1,868 8,580 459% 8.00 17.50 219% 1206 Television Inspections 10,517 10,517 100% 52.00 71.00 137% 1207 Root Cutting / Root Treatment 10,553 8,350 79% 68.00 59.00 87% 1208 Grease Trap Inspections 0 0 0% 0.00 0.00 0% 1209 Manhole Repairs / Inspections 0 2 0% 12.00 1.50 13% 1220 Flow Monitoring 1230 Sewer Stoppage 1251 Construction Inspection / Testing (Warranty) 0 0 0% 0.00 2.50 0% 1260 Overlay Operatiosn - Sewer 0 0 0.00 4301 Vehicle / Equipment Maintenance 20.00 53.00 265% 4302 Building / Landscape Maintenance 10.00 70.00 700% 4303 Errands / Messenger 10.00 5.00 50% 4304 General Administrative Activities 67.00 42.00 63% 4315 Purchasing / Inventory 4 4 20.00 0.00 0% 4318 Training / Seminar 1 1 10.00 36.00 360% 4320 Staff Meetings 4 4 15.00 9.00 60% Total Hours 355.00 407.75 4.50 Working Days in the Month 19 Total Working Hours in the Month 1,032 Days Since Last Sewer Main Backup/Spill 879 Record Days for Sewer Backup/Spill 2,779 Days Since Last Safety Incident 133 Location Requests Number of Requests 192 Number of Locations Provided 56 PLATTE CANYON WATER AND SANITATION DISTRICT OPERATIONS & MAINTENANCE REPORT MARCH, 2017 3/1/2017 Accomplishments Man-hours Job Code Description Scheduled Completed % Scheduled Completed O.T. % 1101 General Water 0 0 8.00 0.00 0% 1102 Pump Station 5 0 0% 6.00 0.00 0% 1103 Customer Service 0 6.00 0.00 0% 1104 Utility Location 0 4.00 0.00 0% 1105 Valve Inspection / Maintenance 129 0 0% 29.00 0.00 0% 1106 Hydrant Inspections / Maintenance 0 0 0% 0.00 0.00 0% 1116 Hydrant Painting 0 0 0% 0.00 0.00 0% 1107 Districbution System Flushing / Testing 19 0 0% 5.00 0.00 0% 1108 P.R.V. Inspections / Maintenance 0 0 0% 0.00 0.00 0% 1109 Air-Vac Inspections / Maintenance 8 0 0% 13.00 0.00 0% 1110 Valve & Hydrant Repair 5 0 0% 23.00 0.00 0% 1120 Pressure Monitoring 0 0 0% 0.00 0.00 0% 1130 Water Break Repair 0 0.00 1151 Construction Inspection / Tesing (Warranty) 0 0 0% 0.00 0.00 0% 1160 Overlay Operations - Water 0 0 0% 1201 General Sewer 0% 6.00 0.00 0% 1202 Lift Station 1203 Customer Service 6.00 0.00 0% 1204 Utility Location 4.00 0.00 0% 1205 Hydraulic Main Cleaning 2,018 0 0% 9.00 0.00 0% 1206 Television Inspections 10,576 0 0% 48.00 0.00 0% 1207 Root Cutting / Root Treatment 13,458 0 0% 96.00 0.00 0% 1208 Grease Trap Inspections 0 0 0% 0.00 0.00 0% 1209 Manhole Repairs / Inspections 0 0 0% 8.00 0.00 0% 1220 Flow Monitoring 1230 Sewer Stoppage 0.00 1251 Construction Inspection / Testing (Warranty) 0 0 0% 0.00 0.00 0% 1260 Overlay Operatiosn - Sewer 0 0 4301 Vehicle / Equipment Maintenance 20.00 0.00 0 4302 Building / Landscape Maintenance 10.00 0.00 0 4303 Errands / Messenger 10.00 0.00 0 4304 General Administrative Activities 67.00 0.00 0 4315 Purchasing / Inventory 5 0 20.00 0.00 0 4318 Training / Seminar 2 0 10.00 0.00 0 4320 Staff Meetings 5 0 15.00 0.00 0 Total Hours 423.00 0.00 0.00 Working Days in the Month 23 Total Working Hours in the Month 1,160 Platte Canyon Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Sewer Maintenance/Hours Scheduled vs. Completed Sewer Main Footage 12,000 10,000 8,000 6,000 Footage 4,000 2,000 0 Scheduled TVI Feet Completed TVI Feet Scheduled HC Feet Completed HC Feet Scheduled RTC/RT Feet Completed RTC/RT Feet Scheduled vs. Completed Sewer Main Hours 80.00 70.00 60.00 50.00 40.00 Hours 30.00 20.00 10.00 0.00 Scheduled TVI Hours Completed TVI Hours Scheduled HC Hours Completed HC Hours Scheduled RTC/RT Hours Completed RTC/RT Hours Platte Canyon Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Water Maintenance/Hours Scheduled vs. Completed Hydrant/Flushing Maintenance 5 4 4 3 3 Assets 2 2 1 1 0 Scheduled Hydrant Maintenace Completed Hydrant Maintenance Scheduled Hydrant Painting Completed Hydrant Pianting Scheduled Flushing Maintenance Completed Flushing Maintenance Scheduled vs. Completed Hydrant/Flushing Hours 1.40 1.20 1.00 0.80 Hours 0.60 0.40 0.20 0.00 Scheduled Hydrant Hours Completed Hydrant Hours Scheduled Hydrant Painting Hours Completed Hydrant Pianting Hours Scheduled Flushing Hours Completed Flushing Hours Platte Canyon Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Water Maintenance/Hours Scheduled vs. Completed Valve Maintenance 1 1 1 1 1 1 Assets 0 0 0 0 0 Scheduled Valve Maintenance Completed Valve Maintenance Scheduled Air Vac Maintenance Completed Air Vac Maintenance Scheduled PRV Maintenance Completed PRV Maintenance Scheduled vs. Completed Valve Hours 1.00 0.90 0.80 0.70 0.60 0.50 Hours 0.40 0.30 0.20 0.10 0.00 Scheduled Valve Hours Completed Valve Hours Scheduled Air Vac Hours Completed Air Vac Hours Scheduled PRV Hours Completed PRV Hours SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT OPERATIONS & MAINTENANCE REPORT FEBRUARY, 2017 2/28/2017 (FINAL) Accomplishments Man-hours Job Code Description Scheduled Completed % Scheduled Completed O.T. % 2101 General Water 1 10.00 18.00 180% 2102 Pump Station 4 4 100% 5.00 7.50 2.00 150% 2103 Customer Service 14 10.00 16.00 6.00 160% 2104 Utility Location 46 10.00 22.00 220% 2105 Valve Inspection / Maintenance 0 0 0% 0.00 0.00 0% 2106 Hydrant Inspections / Maintenance 0 0 0% 0.00 0.00 0% 2116 Hydrant Painting 0 0 0% 0.00 0.00 0% 2107 Districbution System Flushing / Testing 12 12 100% 3.00 2.75 92% 2108 P.R.V. Inspections / Maintenance 0 0 0% 0.00 0.00 0% 2109 Air-Vac Inspections / Maintenance 0 0 0% 0.00 0.00 0% 2110 Valve & Hydrant Repair 10 1 10% 31.00 3.00 10% 2120 Pressure Monitoring 0 0 0% 0.00 0.00 0% 2130 Water Break Repair 1 21.00 2151 Construction Inspection / Tesing (Warranty) 0 2 0% 0.00 6.75 0% 2160 Overlay Operations - Water 0 0 0% 0.00 2201 General Sewer 0 0 0% 6.00 0.00 0% 2202 Lift Station 0.00 2203 Customer Service 1 10.00 0.00 0% 2204 Utility Location 23 10.00 9.00 90% 2205 Hydraulic Main Cleaning 4,472 18,272 409% 27.00 48.00 178% 2206 Television Inspections 13,763 13,763 100% 121.00 65.00 54% 2207 Root Cutting / Root Treatment 340 0 0% 4.00 0.00 0% 2208 Grease Trap Inspections 0 0 0% 0.00 0.00 0% 2209 Manhole Repairs / Inspections 5 1 20% 28.00 2.00 7% 2220 Flow Monitoring 0 0 0% 0.00 0.00 2230 Sewer Stoppage 0 0 0% 0.00 2251 Construction Inspection / Testing (Warranty) 0 0 0% 0.00 0.50 0% 2260 Overlay Operatiosn - Sewer 0 0 0% 0.00 4301 Vehicle / Equipment Maintenance 20.00 53.00 265% 4302 Building / Landscape Maintenance 10.00 70.00 700% 4303 Errands / Messenger 10.00 5.00 50% 4304 General Administrative Activities 67.00 42.00 63% 4315 Purchasing / Inventory 4 4 20.00 0.00 0% 4318 Training / Seminar 1 1 10.00 36.00 360% 4320 Staff Meetings 4 4 15.00 9.00 60% Total Hours 427.00 436.50 8.00 Working Days in the Month 19 Total Working Hours in the Month 1,032 Days Since Last Sewer Main Backup/Spill 396 Record Days for Sewer Backup/Spill 3,025 Days Since Last Safety Incident 133 Location Requests Number of Requests 344 Number of Locations Provided 69 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT OPERATIONS & MAINTENANCE REPORT MARCH, 2017 3/1/2017 Accomplishments Man-hours Job Code Description Scheduled Completed % Scheduled Completed O.T. % 2101 General Water 0 10.00 0.00 0% 2102 Pump Station 5 0 0% 5.00 0.00 0% 2103 Customer Service 0 10.00 0.00 0% 2104 Utility Location 0 10.00 0.00 0% 2105 Valve Inspection / Maintenance 429 0 0% 98.00 0.00 0% 2106 Hydrant Inspections / Maintenance 0 0 0% 0.00 0.00 0% 2116 Hydrant Painting 0 0 0% 0.00 0.00 0% 2107 Districbution System Flushing / Testing 80 0 0% 21.00 0.00 0% 2108 P.R.V. Inspections / Maintenance 0 0 0% 0.00 0.00 0% 2109 Air-Vac Inspections / Maintenance 40 0 0% 64.00 0.00 0% 2110 Valve & Hydrant Repair 10 0 0% 31.00 0.00 0% 2120 Pressure Monitoring 0 0 0% 0.00 0.00 0% 2130 Water Break Repair 0 0.00 2151 Construction Inspection / Tesing (Warranty) 0 0 0% 0.00 0.00 0% 2160 Overlay Operations - Water 0 0 0% 0.00 2201 General Sewer 0 0 0% 6.00 0.00 0% 2202 Lift Station 0.00 2203 Customer Service 0 10.00 0.00 0% 2204 Utility Location 0 10.00 0.00 0% 2205 Hydraulic Main Cleaning 13,502 0 0% 58.00 0.00 0% 2206 Television Inspections 10,838 0 0% 50.00 0.00 0% 2207 Root Cutting / Root Treatment 340 0 0% 2.00 0.00 0% 2208 Grease Trap Inspections 0 0 0% 0.00 0.00 0% 2209 Manhole Repairs / Inspections 120 0 0% 48.00 0.00 0% 2220 Flow Monitoring 0 0 0% 8.00 0.00 2230 Sewer Stoppage 0 0.00 2251 Construction Inspection / Testing (Warranty) 0 0 0% 0.00 0.00 0% 2260 Overlay Operatiosn - Sewer 0 0 0% 0.00 4301 Vehicle / Equipment Maintenance 20.00 0.00 0 4302 Building / Landscape Maintenance 10.00 0.00 0 4303 Errands / Messenger 10.00 0.00 0 4304 General Administrative Activities 67.00 0.00 0 4315 Purchasing / Inventory 5 0 20.00 0.00 0 4318 Training / Seminar 2 0 10.00 0.00 0 4320 Staff Meetings 5 0 15.00 0.00 0 Total Hours 593.00 0.00 0.00 Working Days in the Month 23 Total Working Hours in the Month 1,160 Southwest Metropolitan Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Sewer Maintenance / Hours Scheduled vs. Completed Sewer Main Footage 20,000 18,000 16,000 14,000 12,000 10,000 Footage 8,000 6,000 4,000 2,000 0 Scheduled TVI Feet Completed TVI Feet Scheduled HC Feet Completed HC Feet Scheduled RTC/RT Feet Completed RTC/RT Feet Scheduled vs. Completed Sewer Main Hours 140.00 120.00 100.00 80.00 Hours 60.00 40.00 20.00 0.00 Scheduled TVI Hours Completed TVI Hours Scheduled HC Hours Completed HC Hours Scheduled RTC/RT Hours Completed RTC/RT Hours Southwest Metropolitan Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Water Maintenance / Hours Scheduled vs. Completed Hydrant/Flushing Maintenance 14 12 10 8 Assets 6 4 2 0 Scheduled Hydrant Maintenace Completed Hydrant Maintenance Scheduled Hydrant Painting Completed Hydrant Painting Scheduled Flushing Maintenance Completed Flushing Maintenance Scheduled vs. Completed Hydrant/Flushing Hours 3.50 3.00 2.50 2.00 Hours 1.50 1.00 0.50 0.00 Scheduled Hydrant Hours Completed Hydrant Hours Scheduled Hydrant Painting Hours Completed Hydrant Painting Hours Scheduled Flushing Hours Completed Flushing Hours Southwest Metropolitan Water and Sanitation District FEBRUARY, 2017 Scheduled vs. Completed Water Maintenance / Hours Scheduled vs. Completed Valve Maintenance 1 1 1 1 1 1 Assets 0 0 0 0 0 Scheduled Valve Maintenance Completed Valve Maintenance Scheduled Air Vac Maintenance Completed Air Vac Maintenance Scheduled PRV Maintenance Completed PRV Maintenance Scheduled vs. Completed Valve Hours 1.00 0.90 0.80 0.70 0.60 0.50 Hours 0.40 0.30 0.20 0.10 0.00 Scheduled Valve Hours Completed Valve Hours Scheduled Air Vac Hours Completed Air Vac Hours Scheduled PRV Hours Completed PRV Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed Water Valve Maintenance/Hours Water Valve Maintenance - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 500 450 400 350 300 250 Assets 200 150 100 50 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Valves Completed PC Valves Scheduled SWM Valves Completed SWM Valves Yearly Water Valve Man Hours - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 120 100 80 60 Hours 40 20 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Valve Hours Completed PC Valve Hours Scheduled SWM Valve Hours Completed SWM Valve Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed PRV & Air Vac Maintenance/Hours Yearly PRV/Air-Vac Maintenance - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 45 40 35 30 25 Assets 20 15 10 5 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC PRV Completed PC PRV Scheduled PC Air Vac Completed PC Air Vac Scheduled SWM PRV Completed SWM PRV Scheduled SWM Air Vac Completed SWM Air Vac Yearly PRV/Air-Vac Man Hours - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 70 60 50 40 Hours 30 20 10 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC PRV Hours Completed PC PRV Hours Scheduled PC Air Vac Hours Completed PC Air Vac Hours Scheduled SWM PRV Hours Completed SWM PRV Hours Scheduled SWM Air Vac Hours Completed SWM Air Vac Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed Hydrant Maintenance/Hours Yearly Hydrant Maintenance - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 450 400 350 300 250 Assests 200 150 100 50 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Hydrants Completed PC Hydrants Scheduled SWM Hydrants Completed SWM Hydrants Yearly Hydrant Man Hours - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 120 100 80 60 Hours 40 20 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Hydrant Hours Completed PC Hydrant Hours Scheduled SWM Hydrant Hours Completed SWM Hydrant Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed Hydrant Painting Maintenance/Hours Yearly Hydrant Painting - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 350 300 250 200 Assests 150 100 50 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Hydrant Painting Completed PC Hydrant Painting Scheduled SWM Hydrant Painting Completed SWM Hydrant Painting Yearly Hydrant Painting Man Hours - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 120 100 80 60 Hours 40 20 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Hydrant Painting Hours Completed PC Hydrant Painting Hours Scheduled SWM Hydrant Painting Hours Completed SWM Hydrant Painting Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed Flushing Maintenance/Hours Flushing Maintenance - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 140 120 100 80 Assets 60 40 20 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Flushing Completed PC Flushing Scheduled SWM Flushing Completed SWM Flushing Flushing Man Hours - Past 12 Months Platte Canyon / Southwest Metro Scheduled vs. Completed 35 30 25 20 Hours 15 10 5 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC Flushing Hours Completed PC Flushing Hours Scheduled SWM Flushing Hours Completed SWM Flushing Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed TVI Maintenance / Hours TVI Footage - Past 12 Months Scheduled vs. Completed 35,000 30,000 25,000 20,000 Footage 15,000 10,000 5,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC TVI Footage Completed PC TVI Footage Scheduled SWM TVI Footage Completed SWM TVI Footage TVI Hours - Past 12 Months Scheduled vs. Completed 160 140 120 100 80 Hours 60 40 20 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC TVI Hours Completed PC TVI Hours Scheduled SWM TVI Hours Completed SWM TVI Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed HC Maintenance/Hours HC Footage - Past 12 Months Scheduled vs. Completed 35,000 30,000 25,000 20,000 Footage 15,000 10,000 5,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC HC Footage Completed PC HC Footage Scheduled SWM HC Footage Completed SWM HC Footage Yearly HC Hours Scheduled vs. Completed 90 80 70 60 50 Hours 40 30 20 10 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC HC Hours Completed PC HC Hours Scheduled SWM HC Hours Completed SWM HC Hours Platte Canyon / Southwest Metropolitan Past 12 Months Scheduled vs. Completed RTC & RT Maintenance/Hours RTC / RT Footage - Past 12 Months Scheduled vs. Completed 12,000 10,000 8,000 6,000 Footage 4,000 2,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC RTC/RT Footage Completed PC RTC/RT Footage Scheduled SWM RTC/RT Footage Completed SWM RTC/RT Footage Yearly RTC / RT Hours Scheduled vs. Completed 100 90 80 70 60 50 Hours 40 30 20 10 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Scheduled PC RTC/RT Hours Completed PC RTC/RT Hours Scheduled SWM RTC/RT Hours Completed SWM RTC/RT Hours Platte Canyon / Southwest Metropolitan / Contract Districts Completed Sewer Maintenance Completed Sewer Main Footage AUGUST, 2016 Platte Canyon / Southwest Metropolitan / Contract Districts 20,000 18,000 16,000 14,000 12,000 10,000 Footage 8,000 6,000 4,000 2,000 0 PC TVI Feet SWM TVI Feet Contract Districts TVI Feet PC HC Feet SWM HC Feet Contract Districts HC Feet PC RTC/RT Feet SWM RTC/RT Feet Contract Districts RTC/RT Feet Completed TVI Footage Past 12 Months Platte Canyon / Southwest Metropolitan / Contract Districts 30,000 25,000 20,000 15,000 Footage 10,000 5,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Completed PC Footage Completed SWM Footage Completed Contract Districts Footage Platte Canyon / Southwest Metropolitan / Contract Districts Completed Sewer Maintenance Completed HC Footage Past 12 Months Platte Canyon / Southwest Metropolitan / Contract Districts 35,000 30,000 25,000 20,000 Footage 15,000 10,000 5,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Completed PC Footage Completed SWM Footage Completed Contract Districts Footage Completed RTC/RT Footage Past 12 Months Platte Canyon / Southwest Metropolitan / Contract Districts 12,000 10,000 8,000 6,000 Footage 4,000 2,000 0 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Completed PC Footage Completed SWM Footage Completed Contract Districts Footage PLATTE CANYON, SOUTHWEST METROPOLITAN, BOW MAR, COLUMBINE, VALLEY & LOCHMOOR PRODUCTIVITY REPORT Year to Date 400 396 350 300 250 234 223 219 Performance 200 167 Standard 150 141 Feet per man hour Feet per man 100 50 0 ROOT CUT HYDRAULIC CLEANING TV INSPECTION PLATTE CANYON, SOUTHWEST METROPOLITAN, BOW MAR, COLUMBINE, VALLEY & LOCHMOOR PRODUCTIVITY REPORT February 2017 450 406 400 350 300 250 234 Performance 214 219 200 Standard 161 Feet per man hour Feet per man 150 141 100 50 0 ROOT CUT HYDRAULIC CLEANING TV INSPECTION SCHEDULED TELEVISION INSPECTION FOR FEBRUARY 2017 w mu \ll \\ Av1: \\ DOU.11 · ~ l\Vf._ • Pla11r Canyon TVI • otnhwc~t Mctn.l. 'I VI • Oo" Mar IVI Columhinc TVI Lo.;hmoor l\il V•ll<~ fVI 2017 YEAR-TO-DATE TELEVSION INSPECTION REPORT PLATTE CANYON SOUTHWEST METRO BOW MAR COLUMBINE FEET Preventative Warranty / Carry - Over Total Sched. Completed Deficit Preventative Warranty / Carry - Over Total Sched. Completed Deficit Preventative Warranty / Carry - Over Total Sched. Completed Deficit Preventative Warranty / Carry - Over Total Sched. Completed Deficit Unscheduled Unscheduled Unscheduled Unscheduled JANUARY 8,089 0 0 8,089 8,089 0 26,360 627 0 26,987 26,987 0 0 0 0 0 0 0 0 1,899 0 1,899 1,899 0 FEBRUARY 10,517 0 0 10,517 10,517 0 13,763 0 0 13,763 13,763 0 0 0 0 0 0 0 0 0 0 0 0 0 MARCH 10,576 0 10,576 10,838 0 10,838 0 0 0 0 0 0 0 0 APRIL 7,219 0 7,219 22,993 0 22,993 0 0 0 0 0 0 0 0 MAY 10,343 0 10,343 22,434 0 22,434 0 0 0 0 0 0 0 0 JUNE 12,649 0 12,649 16,137 3,164 19,301 0 0 0 0 0 0 0 0 JULY 0 0 0 9,386 0 9,386 18,334 0 18,334 0 2,040 0 2,040 0 AUGUST 10,806 0 10,806 13,283 0 13,283 0 0 0 0 13,181 0 13,181 0 SEPTEMBER 12,686 0 12,686 15,295 0 15,295 0 0 0 0 0 0 0 0 OCTOBER 0 0 0 17,814 0 17,814 0 0 0 0 0 0 0 0 NOVEMBER 5,929 0 5,929 19,174 0 19,174 0 0 0 0 0 2,189 2,189 0 DECEMBER 13,838 0 13,838 17,511 0 17,511 0 0 0 0 0 0 0 0 TOTAL 102,652 0 102,652 18,606 204,988 3,791 208,779 40,750 18,334 0 18,334 0 15,221 4,088 19,309 1,899 PLATTE CANYON SOUTHWEST METRO BOW MAR COLUMBINE HOURS Preventative Warranty / Carry - Over Total Sched. Completed Preventative Warranty / Carry - Over Total Sched. Completed Preventative Warranty / Carry - Over Total Sched. Completed Preventative Warranty / Carry - Over Total Sched. Completed Unscheduled Unscheduled Unscheduled Unscheduled JANUARY 37 0 0 37 34 121 3 0 123 120 0 0 0 0 0 0 9 0 9 13 FEBRUARY 48 0 0 48 71 63 0 0 63 65 0 0 0 0 0 0 0 0 0 0 MARCH 480 0480 5000500 00000 00000 APRIL 33 0 0 33 0 105 0 0 105 0 0 0 0 0 0 0 0 0 0 0 MAY 47 0 0 47 0 103 0 0 103 0 0 0 0 0 0 0 0 0 0 0 JUNE 580 0580 74140880 00000 00000 JULY 00 000 4300430 8400840 90090 AUGUST 49 0 0 49 0 61 0 0 61 0 0 0 0 0 0 60 0 0 60 0 SEPTEMBER 580 0580 7000700 00000 00000 OCTOBER 00 000 8100810 00000 00000 NOVEMBER 270 0270 8800880 00000 0100100 DECEMBER 630 0630 8000800 00000 00000 TOTAL 469 0 0 469 105 937 17 0 954 185 84 0 0 84 0 70 19 0 88 13 Page 1 TVANAL2017.123 LOCHMOOR VALLEY COMBINED ft/hr ft/hr FEET Preventative Warranty / Carry - Over Total Sched. Completed Deficit Preventative Warranty / Carry - Over Total Sched. Completed Deficit Scheduled Completed Deficit % of Sched. std. compl. % of std. Unscheduled Unscheduled JANUARY 000000 00000036,975 36,975 0 100% 218.8 221.4 101.21% FEBRUARY 0 0 0 0 0 0 9,075 0 0 9,075 9,075 0 33,355 33,355 0 100% 218.8 208.5 95.30% MARCH 0 0 0 0 0 6,348 0 6,348 0 27,762 0 27,762 0% 218.8 ERR ERR APRIL 00000 00 00 30,212 0 30,212 0% 218.8 ERR ERR MAY 0 000 00 00 32,777 0 32,777 0% 218.8 ERR ERR JUNE 0 000 00 00 31,950 0 31,950 0% 218.8 ERR ERR JULY 0 000 00 00 29,760 0 29,760 0% 218.8 ERR ERR AUGUST 0 000 00 00 37,270 0 37,270 0% 218.8 ERR ERR SEPTEMBER 0 000 00 00 27,981 0 27,981 0% 218.8 ERR ERR OCTOBER 0 0 0 0 8,384 0 8,384 0 26,198 0 26,198 0% 218.8 ERR ERR NOVEMBER 0 0 0 0 3,931 0 3,931 0 31,223 0 31,223 0% 218.8 ERR ERR DECEMBER 0 000 00 00 31,349 0 31,349 0% 218.8 ERR ERR TOTAL 0 0 0 0 27,738 0 27,738 9,075 376,812 70,330 306,482 19% 237.5 215.1 90.56% LOCHMOOR VALLEY COMBINED working days days HOURS Preventative Warranty / Carry - Over Total Sched. Completed Preventative Warranty / Carry - Over Total Sched. Completed Scheduled Completed Deficit % of Sched. days act wrk % of Sched. Unscheduled Unscheduled JANUARY 00000 00000 169 167 2 98.80% 19 10 54.93% FEBRUARY 0 0 0 0 0 41 0 0 41 24 152 160 (8) 104.93% 19 10 52.63% MARCH 00000 2900290 127 0 127 0.00% 23 0 0.00% APRIL 00000 00000 138 0 138 0.00% 22 0 0.00% MAY 00000 00000 150 0 150 0.00% 20 0 0.00% JUNE 00000 00000 146 0 146 0.00% 22 0 0.00% JULY 00000 00000 136 0 136 0.00% 21 0 0.00% AUGUST 00000 00000 170 0 170 0.00% 22 0 0.00% SEPTEMBER 00000 00000 128 0 128 0.00% 21 0 0.00% OCTOBER 00000 3800380 120 0 120 0.00% 21 0 0.00% NOVEMBER 00000 1800180 143 0 143 0.00% 19 0 0.00% DECEMBER 00000 00000 143 0 143 0.00% 21 0 0.00% TOTAL 0 0 0 0 0 127 0 0 127 24 1,723 327 1,396 18.98% 250 20 8.18% Page 2 TVANAL2017.123 Southwest Metro Water and Sanitation CIP 17-1W - 8” Water Main Replacement Located in W. Chatfield Ave. Between S. Pierce St. and S. Lamar St. Capital Project Information March - 2017 Project Purpose: Cost shared project between SWM and Jefferson County for the water main replacement portion. Sections of existing water pipe are in conflict with proposed storm sewer Project Description: Replace 1649’ of 8” cement asbestos pipe with 1649’ of 8” PVC pipe Project Status: In design Budget Comparison: Budget Contract Actual % of cost - % of cost - actual to actual to Budget contract Design $0 $0 $0 Construction 212,640 0 0 0 0 Contingencies $31,896 Total $244,536 Schedule: Design: Complete Planned Schedule: May 2017 Bid Date: Notice to Proceed: Construction: Final Completion: Southwest Metro Water and Sanitation {PC 00017289.1 } CIP 17-2W - 8” Replace Variable Frequency Drives (VFD’s) Located at Hogback Pump Station Capital Project Information March - 2017 Project Purpose: Replace failing and outdated Variable Frequency Drives (VFD’s) Project Description: The current VFD’s are past their expected life and need upgrade to avoid service interruptions Project Status: In design Budget Comparison: Budget Contract Actual % of cost - % of cost - actual to actual to Budget contract Design $8,850 $0 $0 0 0 Construction $59,000 $0 $0 0 0 Contingencies $10,170 Total $78,028 Schedule: Design: In-house; RFP sent to 3 vendors Bid Date: March 16th 2017 Start of Construction: Construction: Final Completion: Southwest Metro Water and Sanitation {PC 00017289.1 } CIP 17 -1S – 8” CIPP Lining of Existing Sewer Main Located in W. Chatfield Ave. Between S. Pierce St. and S. Kendall Blvd. Capital Project Information March - 2017 Project Purpose: Sections of sewer pipe showing signs of corrosion Project Description: Line 2745’ of 8” concrete sewer pipe Project Status: In design Budget Comparison: Budget Contract Actual % of cost - % of cost - actual to actual to Budget contract Design $16,093 $0 $0 0 0 Construction $107,285 $0 $0 0 0 Contingencies $18,507 Total $141,885 Schedule: Design: ENS started design Bid Date: Start of Construction: Construction: Final Completion: Southwest Metro Water and Sanitation {PC 00017289.1 } CIP 17-2S - 8” Sewer Main Replacement Located in W. Coal Mine Ave. and S. Newcombe Way. Capital Project Information March - 2017 Project Purpose: Due to expansive soils the existing sewer has shifted causing poor flow. The solution is to re- route the flow to an existing sewer main and S. Newcombe and abandon the old sewer main and manhole. Project Description: Install 111’ of 8” PVC sewer main and abandon 547’ of 8” sewer pipe Project Status: In design Budget Comparison: Budget Contract Actual % of cost - % of cost - actual to actual to Budget contract Design $9,158 $0 $0 Construction $61,050 0 0 0 0 Contingencies $10,531 Total $80,739 Schedule: Design: ENS started design Planned Schedule: Bid Date: Notice to Proceed: Construction: Final Completion: {PC 00017289.1 } Southwest Metro Water and Sanitation Dutch Creek interceptor Sewer Rehabilitation Located along Dutch Creek (just south and parallel to W. Coal Mine Ave.) from S Wadsworth Bl to W. Weaver Dr. and S. Kendall St. CIP 16-1S Capital Project Information March - 2017 Project Purpose: Rehabilitate sewer pipe due to corrosion activity in pipe with potential pipe failure Project Description: Rehabilitate 6,998 feet of 15-inch and 980 feet of 18-inch concrete sewer pipe Project Status: In design Budget Comparison: Budget Contract Actual % of cost - % of cost - actual to actual to Budget contract Design $106,266.00 $154,230.00 $109,816.00 103% 71% Construction $708,440.00 $884,183.50 $775,534.70 1.09% 87% Contingencies $122,206.00 Total $936,922.00 Schedule: Design: Complete Bid Date: 5/24/16 Start of Construction: 9/1/16 Construction: Lining complete 10/20 – Working on restoration (landscape and concrete trail) Final Completion: March 2017 Platte Canyon Water and Sanitation {PC 00017289.1 } CIP 17-1W Located at W. Canyon Dr. between W. Canyon Ave. and S. Depew St. Capital Project Information March - 2017 Project Purpose: Replace 6” cast iron pipe due to multiple leaks Project Description: Replace 994’ of 6” Cast Iron Pipe with 994’ of 6” PVC pipe Project Status: In Design Budget/Contract Comparison: Budget Contract Actual % of cost – % of cost - actual to actual to budget contract Design/Inspection $22,365 $0 $0 Construction $149,100 $0 Contingencies $25,720 Total $197,185 Schedule: Design: ENS started design Bid Date: Notice to Proceed: Construction: Final Completion: Platte Canyon Water and Sanitation {PC 00017289.1 } CIP 17-2W Located at S. Morning Glory Ln. between Blue Sage Dr. and W. Berry Ave. Capital Project Information March - 2017 Project Purpose: Replace 6” cast iron pipe due to multiple leaks Project Description: Replace 1996’ of 6” Cast Iron Pipe with 1996’ of 6” PVC pipe Project Status: In Design Budget/Contract Comparison: Budget Contract Actual % of cost – % of cost - actual to actual to budget contract Design/Inspection $43,785 $0 $0 Construction $291,900 $0 Contingencies $50,353 Total $386,038 Schedule: Design: ENS started design Bid Date: Notice to Proceed: Construction: Final Completion: Platte Canyon Water and Sanitation {PC 00017289.1 } CIP 17-3W Located at W. Frost Dr. and S. Webster St. Capital Project Information March - 2017 Project Purpose: Severe metallic corrosion has occurred to piping within the vault Project Description: Replace a 6” PRV and associated pipe within the vault Project Status: In Design Budget/Contract Comparison: Budget Contract Actual % of cost – % of cost - actual to actual to budget contract Design/Inspection $0 $0 $0 Construction $15,000 $0 Contingencies $2250 Total $17,250 Schedule: Design: In-house; pending Bid Date: Notice to Proceed: Construction: Final Completion: Platte Canyon Water and Sanitation {PC 00017289.1 } CIP 17-1S, 2S, 3S Three contiguous sewer rehabilitation phases located in the following streets: In S. Depew St., W. Ontario Cir. and S. Sheridan Blvd. – W. Plymouth Dr., S. Depew St., and W. Ottawa Ave. – S. Grey Ct., W. Portland Dr., and W. Quarles Dr. Cured in Place Pipe Capital Project Information March - 2017 Project Purpose: Sections of existing sewer pipe showing signs of corrosion. Project Description: Cured-in-place pipe rehabilitation of 7339’ of 8” sewer pipe and 1431’ of 10” sewer pipe. Project Status: In Design Budget/Contract Comparison: Budget Contract Actual % of cost – % of cost - actual to actual to budget contract Design/Inspection $50,378 $0 $0 Construction $321,597 $0 Contingencies $55,476 Total $17,250 Schedule: Design: ENS started design Bid Date: Notice to Proceed: Construction: Final Completion: Platte Canyon Water and Sanitation {PC 00017289.1 } CIP 15-1W Located at Columbine West Pump Station – 7677 W. Ken Caryl Ave. Capital Project Information March - 2017 Project Purpose: Upgrade aging pump station. Determine downsizing by use of gravity flow from DW conduit. Project Description: Replace inlet, outlet and interior cast iron and steel pipe. Evaluate condition of pumps, motors and control system components and replace as necessary. Project Status: In Design Budget/Contract Comparison: Budget Contract Actual % of cost – % of cost - actual to actual to budget contract Design/Inspection $125,000.00 $171,160.00 $168,863.00 0 1.35% 99% Construction $500,000.00 $1,097,880.00 $1,123,558.00 2.24% 1.02% Contingencies $93,750.00 Total $718,750.00 Schedule: Design: Complete Bid Date: 5/24/216 – Winning bid – Glacier Construction Notice to Proceed: Issues 7/13/16 Construction: Start 10/3/16 – 100% Complete; Pay application #7 submitted {PC 00017289.1 } Southwest Metropolitan Water & Sanitation District Checklist for the Month of March 2017 Ck. No. Payee Description Amount Net Amount 018661 Arrowhead Landscape Services $800.00 Repair and maintenance office 560.00 Pump station maintenance 240.00 018662 Bristol Botanics Repair and maintenance office $95.00 018663 CenturyLink Pump station telemetry $94.92 018664 JRS Janitorial, LLC Repair and maintenance office $755.00 018665 Market Direct, Inc. Newsletter $3,963.98 018666 Utility Notification Center Utility Notification $500.25 W00138 Xcel Energy $2,395.04 Pump station utilities 2,264.82 Flow meter utilities 130.22 TOTAL ACH/CHECKS AS OF MARCH 17, 2017 $8,604.19 Southwest Metropolitan Water & Sanitation District Supplemental Checklist for the Month of March 2017 Ck. No. Payee Description Amount Net Amount 018667 Anthony Dursey Director fee $92.35 018668 George E. Hamblin, Jr. Director fee $92.35 018669 Charles Hause Director fee $92.35 018670 Arrowhead Winter Services Repair and maintenance office $302.50 018671 C&L Water Solutions, Inc. Water contract - emergencies $11,037.63 018672 Colorado Litho, Inc. Newsletter $3,226.35 018673 Collins Cockrel & Cole Legal fees $7,949.96 018674 Comcast Business Utilties and telephone $269.80 018675 Dewberry Engineers Inc Dutch Creek CIPP $3,320.00 018676 Denver Water $70.18 Utilties and telephone 58.39 Pump station utilities 11.79 018677 Market Direct, Inc. Newsletter $929.58 018678 Merrick & Company, Inc. Engineering GIS $2,560.44 018679 Platte Canyon W&S District $79,138.96 Repairs and maintenance water 15,704.76 Repairs and maintenance sewer 22,932.94 Office administration 39,628.22 Pump station telemetry 60.41 Flow meter telemetry 483.30 Repair and maintenance office 329.33 018680 Schilling & Company, Inc. Audit fee $5,400.00 018681 System Communications Repair and maintenance office $421.25 018682 Waste Connections of Colorado Repair and maintenance office $179.48 W00139 Xcel Energy Utilties and telephone $1,538.93 Total Supplemental Checks as of March 24, 2017 $116,622.11 TOTAL ACH/CHECKS FOR THE MONTH OF MARCH 2017 $125,226.30 Southwest Metropolitan Water & Sanitation District Schedule of Investment Principal Activity Month of: FEBRUARY, 2017 Date Date of Number Face/ Face Purchase Purchased Purchased Redemption Purchased Maturity of Days Principal Rate Price Interest Yield Yield Totals (Wt. Avg.) (Wt. Avg.) (Wt. Avg.) (Wt. Avg.) (Wt. Avg.) NEW PURCHASES 0 0.00 0 0.00 0 0.00 0 0.00 0 0.00 0 0.00 Average days/Weighted average rate 0 0.0000% 0.00 0.00 0.0000% Total new purchases $0.00 $0.00 REDEMPTIONS 0 0.00 0 0.00 0 0.00 0.00 Average days/Weighted average rate 0 0.0000% 0.0000 0.00 0.0000% Total redemptions $0.00 $0.00 RENEWALS 0 0 0 0 Total renewals $0.00 Net decrease in investments in February $0.00 NOTE: All redemptions are wired to checking account at Wells Fargo Bank West of Littleton or to the UMB Trust account. March 24, 2017 To the Board of Directors Southwest Metropolitan Water and Sanitation District Arapahoe and Jefferson and Douglas Counties, Colorado We have audited the financial statements of Southwest Metropolitan Water and Sanitation District for the year ended December 31, 2016, and have issued our report thereon dated March 24, 2017. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards as well as certain information related to the planned scope and timing of our audit. Responsibilities under U.S. Generally Accepted Auditing Standards As stated in the engagement letter, our responsibility, as described by professional standards, is to express opinions about whether the financial statements prepared by management with your oversight are fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles. Our audit of the financial statements does not relieve you or management of your responsibilities. Generally accepted accounting principles provide for certain required supplementary information (RSI) to supplement the basic financial statements. Our responsibility with respect to the required supplementary information, which supplements the basic financial statements, is to apply certain limited procedures in accordance with generally accepted auditing standards. However, the RSI will not be audited and, because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance, we will not express an opinion or provide any assurance on the RSI. We have been engaged to report on supplemental information, which accompany the financial statements but are not RSI. Our responsibility for this supplementary information, as described by professional standards, is to evaluate the presentation of the supplementary information in relation to the financial statements as a whole and to report on whether the supplementary information is fairly stated, in all material respects, in relation to the financial statements as a whole. Planned Scope and Timing of Audit An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested. Our audit will include obtaining an understanding of the entity and its environment, including internal control, sufficient to assess the risks of material misstatement of the financial statements and to design the nature, timing, and extent of further audit procedures. Material misstatements may result from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or governmental regulations that are attributable to the entity or to acts by management or employees acting on behalf of the entity. We will generally communicate our significant findings at the conclusion of the audit. However, some matters could be communicated sooner, particularly if significant difficulties are encountered during the audit where assistance is needed to overcome the difficulties or if the difficulties may lead to a modified opinion. We will also communicate any internal control related matters that are required to be communicated under professional standards. The audit was performed in February 2017, and we issued our report on March 24, 2017. Significant Audit Findings Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the District are described in Note 2 to the financial statements. For the year ended December 31, 2016 the District implemented the following Governmental Accounting Standards Board Statement: • During the year ended December 31, 2016, the District implemented Government Accounting Standards Board Statement No. 72 – Fair Value Measurement and Application. Under Statement No. 72, the District categorizes the fair value measurements of its investments based on the hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. We noted no transactions entered into by the District during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. There were no accounting estimates that are considered particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The disclosures in the financial statements are neutral, consistent, and clear. There were no financial statement disclosures that are particularly sensitive because of their significance to financial statement users. Difficulties Encountered in Performing the Audit We encountered no difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. We did not identify any known or likely misstatements during the performance of the audit. Disagreements with Management For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated March 24, 2017. Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the governmental unit’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the governmental unit’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Other Matters We applied certain limited procedures to required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI. We were engaged to report on supplementary information, which accompanies the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. Restriction on Use This information is intended solely for the use of the Board of Directors and management of the District and is not intended to be, and should not be, used by anyone other than these specified parties. Very truly yours, SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT Arapahoe, Jefferson, and Douglas Counties, Colorado FINANCIAL STATEMENTS December 31, 2016 and 2015 TABLE OF CONTENTS PAGE INDEPENDENT AUDITOR’S REPORT ...... I MANAGEMENT’S DISCUSSION AND ANALYSIS...... 1 FINANCIAL STATEMENTS Statements of Net Position ...... 7 Statements of Revenues, Expenses and Changes in Net Position ...... 8 Statements of Cash Flows ...... 9 Notes to Financial Statements ...... 11 SUPPLEMENTAL INFORMATION Schedules of Operating Expenses ...... 25 Schedule of Revenue, Expenditures and Changes in Funds Available – Budget and Actual (Non-GAAP Budgetary Basis) ...... 26 Reconciliation of Actual (Non-GAAP Budgetary Basis) to Statement of Revenues, Expenses and Changes in Net Position ...... 27 Independent Auditor’s Report Board of Directors Southwest Metropolitan Water and Sanitation District Arapahoe, Jefferson and Douglas Counties, Colorado We have audited the accompanying financial statements of Southwest Metropolitan Water and Sanitation District (the District) as of and for the years ended December 31, 2016 and 2015, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. I Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Southwest Metropolitan Water and Sanitation District, as of December 31, 2016 and 2015, and the changes in its financial position and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Other-Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 1 through 6 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District’s financial statements as a whole. The supplemental information listed in the table of contents is presented for purposes of additional analysis and are not a required part of the financial statements. The supplemental information is the responsibility of management and was derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. Highlands Ranch, Colorado March 24, 2017 II SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT MANAGEMENT’S DISCUSSION AND ANALYSIS YEARS ENDED DECEMBER 31, 2016 and 2015 The discussion and analysis is designed to provide an analysis of the District’s financial condition and operating results and to inform the reader on the District’s financial issues and activities. The Management’s Discussion and Analysis (MD&A) should be read in conjunction with the District’s financial statements. Financial Highlights • Net Position decreased $1,672,503 (or 2.5%) from 2015 to 2016. • In 2016, net investment income amounted to $96,389 representing 5.5% of the District’s total revenue. • Total capital contributions during 2016 amounted to $1,362,394. • Net Position decreased $2,375,334 (or 3.4%) from 2014 to 2015. • In 2015, net investment income amounted to $301,035 representing 34.2% of the District’s total revenue. • Total capital contributions during 2015 amounted to $310,362. Overview of the Financial Statements The financial statements of the District are presented as a special purpose government engaged in business type activities – providing water and sewer services. The Statement of Net Position presents information on all of the District’s assets and liabilities, with the difference between the two reported as Net Position. Over time, increases or decreases in the Net Position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating. The Statement of Revenues, Expenses and Changes in Net Position presents information which reflects how the District’s Net Position changed during the past year. All changes in Net Position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported in the statement for some items that will only result in cash flows in future fiscal periods. The Statement of Cash Flows reports the District’s cash flows from operating, noncapital financing, capital and investing activities. These financial statements distinguish functions of the District that will be principally supported by investment income, service fees and tap fees. The functions of the District include effective and economical operation of water distribution and wastewater collection systems within the jurisdictional boundaries of the District. The notes to the financial statements provide additional information that is essential to a full understanding of the data provided in the financial statements. 1 NET POSITION December 31, 2016 2015 2014 ASSETS Current assets $ 9,513,304 $ 12,646,950 $ 14,425,310 Noncurrent assets: Long-term cash deposits and investments 15,690,035 14,036,820 15,528,667 Capital assets, net 40,367,962 40,474,176 40,092,016 Total noncurrent assets 56,057,997 54,510,996 55,620,683 Total assets 65,571,301 67,157,946 70,045,993 LIABILITIES Current liabilities 310,482 224,624 737,337 Total liabilities 310,482 224,624 737,337 NET POSITION Net investment in capital assets 40,367,962 40,474,176 40,092,016 Restricted - Emergency reserve 34,800 25,300 60,200 Unrestricted 24,858,057 26,433,846 29,156,440 Total net position $ 65,260,819 $ 66,933,322 $ 69,308,656 As noted earlier, Net Position may serve over time as a useful indicator of the District’s financial position. In the case of the District, assets exceeded liabilities by $65,260,819, $66,933,322, and $69,308,656 at December 31, 2016, 2015, and 2014 respectively. The largest portion of the District’s Net Position reflects its net investment in capital assets. The District uses these capital assets to provide services to citizens; consequently these assets are not available for future spending. Unrestricted Net Position may be used to meet the District’s ongoing obligations to maintain the water and sewer systems within the jurisdictional boundaries. Comparing 2015 to 2016, Current assets decreased $3,133,646 while long-term cash deposits and investments increased $1,653,215. Significant planned sewer capital projects continued during 2016 resulting in the decrease of net position. Amounts due contractors for work in progress on these sewer capital projects substantiates the increase in current liabilities of $85,858 from 2015 to 2016. Comparing 2014 to 2015, Current assets decreased $1,778,360 while long-term cash deposits and investments decreased $1,491,847. As the District does not levy property taxes, the District relies heavily on its cash and investment reserves to fund operations as well as its investment in capital. This funding explains the overall decrease in assets. The District has incurred significant capital costs over the last few years rehabilitating major sewer interceptors. The decrease in current liabilities of $512,713 is due to the significant completion of construction projects under contract during 2015 as opposed to 2014. 2 REVENUES, EXPENSES AND CHANGES IN NET POSITION Years ending December 31, 2016 2015 2014 REVENUE OPERATING REVENUE Charges for services $ 291,487 $ 268,580 $ 176,255 Total operating revenue 291,487 268,580 176,255 NONOPERATING REVENUE Net investment income 96,389 301,035 656,913 Total nonoperating revenue 96,389 301,035 656,913 CAPITAL CONTRIBUTIONS Tap fees 769,321 178,377 741,089 Capital projects contributions - 94,597 429,644 Contrbuted assets from developers 593,073 37,388 1,068,603 Total capital contributions 1,362,394 310,362 2,239,336 Total revenue 1,750,270 879,977 3,072,504 EXPENSES OPERATING EXPENSES Water operations 1,537,625 1,528,357 1,534,090 Sewer operations 1,130,495 1,029,348 1,060,992 General and administrative 740,531 694,258 742,019 Total operating expenses 3,408,651 3,251,963 3,337,101 NONOPERATING EXPENSES Loss on disposal of property and equipment 14,122 3,348 130,801 Total nonoperating expenses 14,122 3,348 130,801 Total expenses 3,422,773 3,255,311 3,467,902 CHANGE IN NET POSITION (1,672,503) (2,375,334) (395,398) NET POSITION - BEGINNING OF YEAR 66,933,322 69,308,656 69,704,054 NET POSITION - END OF YEAR $ 65,260,819 $ 66,933,322 $ 69,308,656 Total revenue increased $870,293 or 98.9% from 2015 to 2016. The District’s net investment income decreased $204,646. This change is attributed to a negative fair market value adjustment of $327,200 at December 31, 2016 compared to a negative fair market value adjustment of $78,537 at December 31. 2015. Total capital contributions increased $1,052,032 due to the completion of significant developments within the District during 2016. Total revenue decreased $2,192,527 or 71.4% from 2014 to 2015. The District’s net investment income decreased $355,878. This decrease is due to the decrease in the Districts investment portfolio due to funding District operations and investment in capital. Capital contributions 3 decreased $1,928,974. Significant developments were completed during 2014 compared to a small project being completed during 2015. The increase in total expenses from 2015 to 2016 amounted to $167,462 or 5.1%. Sewer operations expense increased by $101,147. This increase is due to a payment of $73,699 made under a sewer service agreement with Ken Caryl Water and Sanitation District that requires the District to share in the operation, maintenance and rehabilitation costs of a sewer interceptor. Total expenses decreased $212,591 or 6.1% from 2014 to 2015. This change is due primarily to the write off of rehabilitated mains during 2014 which resulted in a loss on disposal of $130,801. Operating expenses were fairly consistent from 2014 to 2015 decreasing $85,138 or 2.6%. Budgetary Highlights The District prepares its budget on a non-GAAP budgetary basis of accounting to recognize the fiscal impact of sale of assets, capital outlay, in addition to operations and nonoperating revenues and contributions. Capital contributions of facilities and depreciation are not reflected on the budget as they do not affect “funds available”. This budgetary accounting is required by State statutes. Actual revenue for the District was more than budgeted revenues by $191,707. Due to the significant development in the District, the timing of the collection of tap fees was difficult to anticipate. Actual water and sewer tap fees collected during 2016 was more than the budget amounts by $294,000 and $110,821, respectively. Actual net investment income amounted to a positive $96,389 resulting in a negative budget variance of $168,961. A fair value mark down of investments at December 31, 2016 amounted to $327,200. It is the District policy to hold all investments to maturity, therefore, any fair value adjustment is considered unrealized. Budgeted expenditures exceeded actual expenditures by $211,386. In addition to budgeting for emergency reserve, the District budgets an additional 15% of the projected water and sewer capital expenses to cover unanticipated increases in construction costs. Use of this contingency amount of $156,703 offset higher actual construction costs related to the rehabilitation of a sewer interceptor. The District attempts to budget for the cost to repair unforeseen water main breaks. The positive variance in water repair and maintenance of $90,037 is attributed to fewer instances of water main breaks requiring repair than projected as well as a decrease in labor hours devoted to water operations. Capital Assets The District’s net investment in capital assets at December 31, 2016, 2015, and 2014 amounted to $40,367,962, $40,474,176, and $40,092,016 (net of accumulated depreciation/amortization), respectively. Analysis of changes in capital assets from 2015 to 2016 is as follows: 4 Percentage 2016 2015 Change Land and easements 64,819 64,819 0.0% Construction in progress 989,718 342,845 188.7% Water distribution systems 19,032,172 19,670,618 -3.2% Sewage collection system 19,088,751 19,212,978 -0.6% Office building 1,181,055 1,165,366 1.3% Other 11,447 17,550 -34.8% Total net capital assets $ 40,367,962 $ 40,474,176 Construction in progress for a major sewer interceptor amounted to $921,948 which entailed the rehabilitation of 7,978 feet of concrete sewer pipe. This project is substantially complete, but will be carried over to 2017. Additionally, $67,770 is included in construction in progress and relates to the planned remodel of the District’s office building. The remodel will be completed during 2017. Analysis of changes in capital assets from 2014 to 2015 is as follows: Percentage 2015 2014 Change Land and easements 64,819 64,819 0.0% Construction in progress 342,845 1,246,292 -72.5% Water distribution systems 19,670,618 20,467,992 -3.9% Sewage collection system 19,212,978 17,077,328 12.5% Office building 1,165,366 1,211,930 -3.8% Other 17,550 23,655 -25.8% Total net capital assets $ 40,474,176 $ 40,092,016 Two significant planned construction projects, one of which began during 2014, relating to the rehabilitation of two major sewer interceptors were completed during 2015 amounting to a total cost of $2,772,053. Columbine Water & Sanitation District and Grant Water & Sanitation District are contractually obligated to reimburse the District for their portion of the costs. Such reimbursement for construction costs incurred during 2015 amounted to $94,597. The amount of construction in progress at December 31, 2015 of $342,845 relates to the replacement of a total of 836 feet of sewer mains which was completed during the spring of 2016. Additional information on the District’s capital assets can be found in NOTE 4 of this report. 5 Economic Factors and Next Year’s Budget • Total revenue is budgeted at $1,233,564. Investment income is budgeted at $335,744 which is based on a projected average yield of 1.35%. • The District will continue to impose a service fee to customers. Beginning in 2017, the fee will be increased from $1.00 to $3.00 per month per ¾” equivalent. Service fee revenue budgeted for 2017 is $536,220 based on 14,895, ¾” equivalents. • The budget for operating expenditures and capital expenditures is $1,624,533 and $728,704 respectively. • Total expenditures for 2017 are projected to exceed revenue by $1,119,673 which will be funded by the District’s current funds available. Requests for Information This report is designed to provide a general overview of the District’s finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to: Financial Administrator, Southwest Metropolitan Water and Sanitation District, 8739 W. Coal Mine Ave., Littleton, Colorado 80123. 6 FINANCIAL STATEMENTS SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT STATEMENTS OF NET POSITION December 31, 2016 and 2015 2016 2015 ASSETS CURRENT ASSETS Cash and cash equivalents $ 6,446,218 $ 6,705,302 Cash deposits and investments 2,849,965 5,683,053 Other receivables 66,828 146,729 Accrued interest receivable 139,385 99,975 Prepaid expenses 10,908 11,891 Total current assets 9,513,304 12,646,950 NONCURRENT ASSETS Long-term cash deposits and investments 15,690,035 14,036,820 Capital assets: Land and easements 64,819 64,819 Construction in progress 989,718 342,845 Water distribution system 42,090,708 41,735,434 Sewage collection system 33,644,178 33,003,820 Office building 2,355,076 2,294,603 Other 33,699 33,699 Less accumulated depreciation (38,810,236) (37,001,044) Total capital assets (net of accumulated depreciation) 40,367,962 40,474,176 Total noncurrent assets 56,057,997 54,510,996 Total assets 65,571,301 67,157,946 LIABILITIES CURRENT LIABILITIES Accounts payable 224,190 206,225 Retainage payable 39,325 15,899 Deposits from developers 46,967 2,500 Total current liabilities 310,482 224,624 NET POSITION Net investment in capital assets 40,367,962 40,474,176 Restricted for emergencies 34,800 25,300 Unrestricted 24,858,057 26,433,846 TOTAL NET POSITION $ 65,260,819 $ 66,933,322 These financial statements should be read only in connection with the accompanying notes to financial statements. 7 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION Years Ended December 31, 2016 and 2015 2016 2015 OPERATING REVENUE Charges for services $ 291,487 $ 268,580 Total operating revenue 291,487 268,580 OPERATING EXPENSES Water operations 1,537,625 1,528,357 Sewer operations 1,130,495 1,029,348 General and administrative 740,531 694,258 Total operating expenses 3,408,651 3,251,963 (LOSS) FROM OPERATIONS (3,117,164) (2,983,383) NONOPERATING REVENUE Investment income 423,589 379,572 Net decrease in fair value of investments (327,200) (78,537) Total nonoperating revenue 96,389 301,035 NONOPERATING EXPENSES Loss on disposal of property and equipment (14,122) (3,348) Total nonoperating expenses (14,122) (3,348) (LOSS) BEFORE CONTRIBUTIONS (3,034,897) (2,685,696) CAPITAL CONTRIBUTIONS Tap fees 769,321 178,377 Capital projects contributions - 94,597 Contributed assets 593,073 37,388 Total capital contributions 1,362,394 310,362 CHANGE IN NET POSITION (1,672,503) (2,375,334) NET POSITION - BEGINNING OF YEAR 66,933,322 69,308,656 NET POSITION - END OF YEAR $ 65,260,819 $ 66,933,322 These financial statements should be read only in connection with the accompanying notes to financial statements. 8 SOUTHWEST METROPOLITAN WANTER AND SANITATION DISTRICT STATEMENTS OF CASH FLOWS Years Ended December 31, 2016 and 2015 2016 2015 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers $ 415,855 $ 226,109 Cash payments to suppliers for goods and services (1,571,998) (1,454,588) Cash flows used for operating activities (1,156,143) (1,228,479) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Contributed capital - Tap fees 769,321 178,377 Contributed captial - cost reimbursement - 48,273 Acquisition of property, plant and equipment (1,109,114) (2,660,214) Cash flows used by capital and related financing activities (339,793) (2,433,564) CASH FLOWS FROM INVESTING ACTIVITIES Interest received 393,489 429,499 Purchase of investments (12,999,328) (7,005,281) Matured investments 13,842,691 11,822,625 Cash provided by investing activities 1,236,852 5,246,843 NET CHANGE IN CASH AND CASH EQUIVALENTS (259,084) 1,584,800 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 6,705,302 5,120,502 CASH AND CASH EQUIVALENTS - END OF YEAR $ 6,446,218 $ 6,705,302 (Continued) These financial statements should be read only in connection with the accompanying notes to financial statements. 9 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT STATEMENTS OF CASH FLOWS Years Ended December 31, 2016 and 2015 (Continued) 2016 2015 Reconciliation of (loss) from operations to net cash used for operating activities (Loss) from operations $ (3,117,164) $ (2,983,383) Adjustments to reconcile (loss) from operations to net cash used for operating activities Depreciation and amortization 1,842,117 1,784,096 Effects of changes in operating assets and liabilities: Accounts receivable 79,901 (42,609) Prepaid expenses 983 (1,868) Accounts payable (6,447) 15,147 Deposits from developers 44,467 138 Total adjustments 1,961,021 1,754,904 Cash flows used for operating activities $ (1,156,143) $ (1,228,479) NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES Contributions of capital assets from developers $ 593,073 $ 37,388 These financial statements should be read only in connection with the accompanying notes to financial statements. 10 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 1 – DEFINITION OF REPORTING ENTITY Southwest Metropolitan Water and Sanitation District (the District), a quasi-municipal corporation, is governed pursuant to provisions of the Colorado Special District Act. The District’s service area is located in Jefferson, Arapahoe and Douglas Counties, Colorado. The District was established to provide water and sanitation services. The District follows the Governmental Accounting Standards Board (GASB) accounting pronouncements which provide guidance for determining which governmental activities, organizations and functions should be included within the financial reporting entity. GASB pronouncements set forth the financial accountability of a governmental organization’s elected governing body as the basic criterion for including a possible component governmental organization in a primary government’s legal entity. Financial accountability includes, but is not limited to, appointment of a voting majority of the organization’s governing body, ability to impose its will on the organization, a potential for the organization to provide specific financial benefits or burdens and fiscal dependency. The District is not financially accountable for any other organization, nor is the District a component unit of any other primary governmental entity. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the District conform to generally accepted accounting principles as applicable to governmental units accounted for as a proprietary enterprise fund. The enterprise fund is used since the District’s powers are related to those operated in a manner similar to a private utility system where net income and capital maintenance are appropriate determinations of accountability. The more significant accounting policies of the District are described as follows: 11 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Basis of Accounting The District’s records are maintained on the accrual basis of accounting. Revenue is recognized when earned and expenses are recognized when the liability is incurred. Depreciation and amortization are computed and recorded as operating expenses. Expenditures for property and equipment are shown as increases in assets. Tap fees, inclusion fees and contributed water and sewer lines are recorded as capital contributions when received. Operating Revenues and Expenses The District distinguishes between operating revenue and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with the District’s purpose of providing water and sewer services to its customers. Charges to customers for services provided are performed by a third-party (see Note 5 - Denver Water Board). Operating expenses include cost of service, administrative expenses, and depreciation and amortization of assets. All revenues and expenses not meeting this definition are reported as nonoperating revenue and expenses or capital contributions. Budgets In accordance with the State Budget Law, the District’s Board of Directors holds public hearings in the fall each year to approve the budget and appropriate the funds for the ensuing year. The appropriation is at the total fund expenditures level and lapses at year end. The District’s Board of Directors can modify the budget by line item within the total appropriation without notification. The appropriation can only be modified upon completion of notification and publication requirements. A budget is legally adopted for the District, and is presented on a Non- GAAP budgetary basis. Restricted Resources When both restricted and unrestricted resources are available for use, it is the District’s policy to use restricted resources first, then unrestricted resources as they are needed. 12 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Cash Equivalents and Investments For purposes of the statement of cash flows, the District considers cash deposits and highly liquid investments with a maturity of three months or less when purchased, to be cash equivalents. Investments are recorded at fair value. Capital Assets Capital assets which include property, equipment, and infrastructure are recorded at cost except for those assets which have been contributed which are stated at estimated fair value at the date of contribution or at developer’s cost. Capital assets are defined by the District as assets with an initial cost of more than $1,000 and an estimated useful life in excess of one year. Depreciation and amortization expense has been computed using the straight-line method over the estimated economic useful lives: Distribution and collection systems 20 – 40 years Office building and improvements 15 – 40 years Other 3 – 5 years Net Position Net Position is categorized as net investment in capital assets, restricted and unrestricted. Net investment in capital assets is intended to reflect the portion of Net Position which are associated with non-liquid, capital assets. Restricted Net Position are liquid assets, which have third party limitations on their use. Unrestricted Net Position represent assets that do not have any third party limitations on their use. NOTE 3 – CASH DEPOSITS AND INVESTMENTS At December 31, the District had the following cash and investments: 2016 2015 Deposits $ 2,349,896 $ 3,186,538 Investments 22,636,322 23,238,637 Total $ 24,986,218 $ 26,425,175 13 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 3 – CASH DEPOSITS AND INVESTMENTS (CONTINUED) Cash deposits and investments are reflected on the December 31, Statement of Net Position as follows: 2016 2015 Cash and cash equivalents $ 6,446,218 $ 6,705,302 Cash deposits and investments 2,849,965 5,683,053 Long-term cash deposits and investments 15,690,035 14,036,820 $ 24,986,218 $ 26,425,175 Cash Deposits The Colorado Public Deposit Protection Act (PDPA) requires deposits of all units of local government to be made in eligible public depositories. Eligibility is determined by state regulations. Amounts on deposit in excess of federal insurance levels must be collateralized by eligible collateral as determined by the PDPA. PDPA allows the institution to create a single collateral pool for all public funds. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. The market value of the collateral must be at least equal to the 102% of the uninsured deposits. Investments Colorado statutes specify investment instruments meeting defined rating, maturity, custodial and concentration risk criteria in which local governments may invest which include: . Obligations of the U.S. and certain U.S. government agency securities and the World Bank . General obligation and revenue bonds of U.S. local government entities . Bankers’ acceptances of certain banks . Commercial paper . Certain reverse repurchase agreements . Certain securities lending agreements . Certain corporate bonds . Written repurchase agreements collateralized by certain authorized securities . Certain money market mutual funds . Guaranteed investment contracts . Local government investment pools The investment policy adopted by the Board of Directors of the District establishes additional restrictions to the requirements specified by state statutes. 14 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 3 – CASH DEPOSITS AND INVESTMENTS (CONTINUED) At December 31, the District had the following investments: Investment Maturities (in Years) 2016 Investment Rating Less than 1 1 - 5 More than 5 Total U.S. Government Instrumentalities AAA/AA+ $ - $ 7,914,940 $ 1,916,080 $ 9,831,020 U.S. Treasury Notes N/A 999,100 5,366,015 - 6,365,115 Local Government Investment Pool AAAm 6,440,187 - - 6,440,187 $ 7,439,287 $ 13,280,955 $ 1,916,080 $ 22,636,322 Investment Maturities (in Years) 2015 Investment Rating Less than 1 1 - 5 More than 5 Total U.S. Government Instrumentalities AAA/AA+ $ - $ 5,625,310 $ 1,979,320 $ 7,604,630 U.S. Treasury Notes N/A 2,501,575 994,690 5,437,500 8,933,765 Local Government Investment Pool AAAm 6,700,242 - - 6,700,242 $ 9,201,817 $ 6,620,000 $ 7,416,820 $ 23,238,637 Interest Rate Risk – In accordance with its investment policy, the District manages its exposure to declines in fair values by limiting investments in U.S. Treasuries and U.S. Agencies to an original maturity of ten years or less. Credit risk – The District’s investment policy limits investments to U.S. Treasury obligations and U.S. Government agency securities, local government investment pools, and certain money market mutual funds approved by the Board of Directors. At the time of purchase, investments must have a credit rating equal to or greater than that specified by state statutes. 15 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 3 – CASH DEPOSITS AND INVESTMENTS (CONTINUED) Concentration of Credit Risk – It is the policy of the District to diversify its investment portfolio to eliminate risk of loss resulting from over concentration of assets in a specific maturity, a specific class, and specific issuer of securities. The District policy includes cash deposits in the total portfolio when determining concentration of investments. The policy provides that the total portfolio of the District may be comprised of 100% U.S. Treasury Notes. However, investment in U.S. agency and instrumentalities may not exceed 50% of the District’s total portfolio and investment in any one issuer may not exceed 20% of the total portfolio. Investments in local government investment pools as well as money market mutual funds may not exceed 25% of the District’s total portfolio. The policy provides for variances in the stated maximum percentage limitations not to exceed 10% at any given time. At December 31, 2016, the District’s investment in Federal Home Loan Mortgage Bank, Federal National Mortgage Association, Federal Home Loan Mortgage Corp, and Federal Farm Credit Banks were 12.93%, 8.58%, 8.53%, and 13.39%, respectively, of the District’s total investments and 11.72%, 7.77%, 7.73%, and 12.13%, respectively, of the District’s total portfolio. At December 31, 2015, the District’s investment in Federal Home Loan Mortgage Bank, Federal National Mortgage Association, Federal Home Loan Mortgage Corp, and Federal Farm Credit Banks were 4.30%, 8.52%, 8.56%, and 11.34%, respectively, of the District’s total investments and 3.78%, 7.49%, 7.53%, and 9.98%, respectively, of the District’s total portfolio. Local Government Investment pool - As of December 31, 2016 and 2015, the District had $6,440,187 and $6,700,242 respectively, invested in the Colorado Local Government Liquid Asset Trust (Colotrust), an investment vehicle established for local government entities in Colorado to pool surplus funds and is registered with the State Securities Commissioner. Colotrust is rated AAAm by Standard and Poor’s. Colotrust operates similarly to a money market fund and each share is equal in value to $1.00. Colotrust offers shares in two portfolios, Colotrust Prime and Colotrust Plus+. A designated custodial bank serves as custodian for Colotrust’s portfolios pursuant to a custodian agreement. Substantially all securities owned by Colotrust are held by the Wells Fargo Bank, N.A. in the account maintained for the custodial banks. The custodian acts as safekeeping agent for Colotrust investment portfolios and provides services as the depository in connection with direct investments and withdrawals. The custodian's internal records segregate investments owned by each participating government. 16 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 3 – CASH DEPOSITS AND INVESTMENTS (CONTINUED) Investment Valuation The District categorizes the fair value measurements of its investments based on the hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. At December 31, the District had the following fair value measurements: Fair Value Measurement Using 2016 Investment Level 1 inputs Level 2 inputs Level 3 inputs Total U.S. Government Instrumentalities $ 9,831,020 $ - $ - $ 9,831,020 U.S. Treasury Notes 6,365,115 - - 6,365,115 Local Government Investment Pool - 6,440,187 - 6,440,187 $ 16,196,135 $ 6,440,187 $ - $ 22,636,322 Fair Value Measurement Using 2015 Investment Level 1 inputs Level 2 inputs Level 3 inputs Total U.S. Government Instrumentalities $ 7,604,630 $ - $ - $ 7,604,630 U.S. Treasury Notes 8,933,765 - - 8,933,765 Local Government Investment Pool - 6,700,242 - 6,700,242 $ 16,538,395 $ 6,700,242 $ - $ 23,238,637 17 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 4 – CAPITAL ASSETS An analysis of the changes in capital assets for the year ended December 31, 2016 follows: Balance at Balance at December December 31, 2015 Additions Deletions 31, 2016 Capital assets, not being depreciated: Land and easements $ 64,819 $ - $ - $ 64,819 Construction in progress 342,845 1,058,797 411,924 989,718 Total capital assets not being depreciated 407,664 1,058,797 411,924 1,054,537 Capital assets, being depreciated: Water distribution system 41,735,434 356,208 934 42,090,708 Sewage collection system 33,003,820 674,344 33,986 33,644,178 Office building 2,294,603 72,600 12,127 2,355,076 Other 33,699 - - 33,699 Total capital assets being depreciated 77,067,556 1,103,152 47,047 78,123,661 Less accumulated depreciation/amortization: Water distribution system (22,064,816) (994,654) (934) (23,058,536) Sewage collection system (13,790,842) (784,449) (19,864) (14,555,427) Office building (1,129,237) (56,911) (12,127) (1,174,021) Other (16,149) (6,103) - (22,252) Total accumulated depreciation (37,001,044) (1,842,117) (32,925) (38,810,236) Total capital assets, being depreciated, net 40,066,512 (738,965) 14,122 39,313,425 Net Capital Assets $ 40,474,176 $ 319,832 $ 426,046 $ 40,367,962 18 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 4 – CAPITAL ASSETS (CONTINUED) An analysis of the changes in capital assets for the year ended December 31, 2015 follows: Balance at Balance at December December 31, 2014 Additions Deletions 31, 2015 Capital assets, not being depreciated: Land and easements $ 64,819 $ - $ - $ 64,819 Construction in progress 1,246,292 1,917,656 2,821,103 342,845 Total capital assets not being depreciated 1,311,111 1,917,656 2,821,103 407,664 Capital assets, being depreciated: Water distribution system 41,546,168 202,928 13,662 41,735,434 Sewage collection system 30,496,045 2,858,491 350,716 33,003,820 Office building 2,287,821 11,632 4,850 2,294,603 Other 33,699 - - 33,699 Total capital assets being depreciated 74,363,733 3,073,051 369,228 77,067,556 Less accumulated depreciation/amortization: Water distribution system (21,078,176) (997,736) (11,096) (22,064,816) Sewage collection system (13,418,717) (722,841) (350,716) (13,790,842) Office building (1,075,891) (57,414) (4,068) (1,129,237) Other (10,044) (6,105) - (16,149) Total accumulated depreciation (35,582,828) (1,784,096) (365,880) (37,001,044) Total capital assets, being depreciated, net 38,780,905 1,288,955 3,348 40,066,512 Net Capital Assets $ 40,092,016 $ 3,206,611 $ 2,824,451 $ 40,474,176 Depreciation and amortization expense for the years ended December 31, 2016 and 2015 was charged to the following operations: 2016 2015 Water 994,654 997,737 Sewer 784,449 722,841 Administration 63,014 63,518 $1,842,117 $ 1,784,096 19 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 5 – CONTRACTS Denver Water Board The District has a distributor contract with the Denver Water Board (Denver) whereby Denver provides water in the District’s service area and charges the users directly (“read and bill” type of distributor’s contract). The District is responsible for maintenance and replacement of the water mains owned by the District. During 2014, under the distributor contract with Denver, the District entered into an Intergovernmental Agreement with Denver to impose a service fee of $1.00 per month per ¾” equivalent to District customers. The service fee is to be used for operations, maintenance, and rehabilitation, of the District facilities. The fee is imposed on customers’ Denver Water bills, with the revenue collected by Denver Water and remitted to the District less a collection fee. Service fee revenue amounted to $179,312 and $175,839 in 2016 and 2015, respectively. In 1975, the District entered into an agreement with Denver whereby the District constructed water mains and conveyed them to Denver in exchange for a water supply of 5,500,000 gallons per day. Denver is responsible for the operation, maintenance and replacement of these mains. The District participated in the cost to construct facilities owned by Denver (agreement date 1977). The District acquired the right to sufficient capacities in the water line to serve taps reserved to the District for $6,742,264. This amount is included in the water distribution system and is being amortized over 40 years using the straight-line method. Accumulated amortization at December 31, 2016 and 2015 is $5,199,371 and, $5,030,819 respectively. The District has additional contracts with Denver for its participation costs in facilities. These facilities were deemed complete during 2005 and the District has no further commitments under the contracts. The District’s participation amounted to $4,484,958, which reserves additional capacity in the Denver system for the District. This amount has been included in the water distribution system and is being amortized over 40 years using the straight-line method. Accumulated amortization at December 31, 2016 and 2015 is $1,233,363 and $1,121,240, respectively. City of Littleton The District has a contract with the City of Littleton (the City) whereby the City provides sewage treatment for the District and bills users directly. The District is responsible for maintenance and replacement of the sewer mains within the District and will retain title to them. 20 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 5 – CONTRACTS (CONTINUED) Meadowbrook-Fairview In 1976, the District agreed to reserve for Meadowbrook-Fairview Metropolitan District (Meadowbrook-Fairview) sewer capacity for 1,550 single family or equivalent sanitary sewer taps in its facilities. The contract provides that sewer lines described as outfalls “A” & “B” that were constructed by Meadowbrook-Fairview remain the property of Meadowbrook-Fairview until its bonded indebtedness incurred in construction is fully paid. During 1997, the contract was amended and extended for twenty years. At that time outfall lines “A” & “B” and all easements relating thereto were conveyed to the District as provided in the original contract. During 1999, the contract was again amended, increasing the total allowable taps by 336 to 1,886 taps. Meadowbrook-Fairview must pay the sum of $227 for each single-family residential equivalent together with Southwest’s applicable tap fee at the time of connection. At December 31, 2016, remaining taps to be issued under the contract amounted to 82. Grant Water and Sanitation District On August 14, 1962, the District entered into an agreement (1962 Agreement) with Grant Water and Sanitation District (Grant) to accommodate the future transmission of sewage from 5,000 single family equivalent taps. Grant agreed to pay the District $50 at the time each individual tap is connected. During 1983, an additional agreement provided for an alternate point of connection to the Districts sewer system for 300 single family equivalent taps, within Grant at $450 per individual tap. The 300 sewer taps are part of, and not in addition to the 5,000 sewer taps allowed under the 1962 Agreement. At December 31, 2016, remaining taps to be issued under the agreements amounted to 1,392. 21 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 6 – COMMITMENTS AND CONTINGENCIES Intergovernmental Agreement – Management and Maintenance In 1986, the District entered into an agreement with Platte Canyon Water and Sanitation District (Platte Canyon) wherein Platte Canyon provides management, maintenance, inspection and clerical services to the District. Under the agreement, Platte Canyon bills the District monthly for its proportionate share of costs. During 2014, the contract was renewed for ten years with an option for the District to renew for successive five-year periods after December 31, 2024. During 2016 and 2015 the District reimbursed Platte Canyon $978,552 and $1,003,781, respectively for services provided. Intergovernmental Agreement – Joint Office and Garage Facility On March 27, 1998, the District entered into an intergovernmental agreement with Platte Canyon, which provides for cost sharing of a new office and garage facility. The cost of the new facility was $1,816,148, of which, the District paid 70% or $1,271,303. Upon termination of the agreement, Platte Canyon will be entitled to 30% of the appraised replacement value of the joint facility excluding land value. Platte Canyon pays the District a monthly rent and a proportionate share of the operation and maintenance expense determined on a quarterly basis. The Intergovernmental Agreement will be effective until December 31, 2018. Reimbursement of operation and maintenance costs received from Platte Canyon during 2016 and 2015 amounted to $47,453 and $21,820, respectively. Water Tap Deposit Agreement Advance deposits for the purchase of future water taps were received during 1978. At December 31, 2016, remaining advance deposits amounted to $552,750, which represents the District’s intention to issue 737 water taps. This amount was recorded as contributions when received. No advance deposits were used or refunded in 2016 and 2015. NOTE 7 – LEASES In 1969, the District entered into an agreement with the City of Littleton whereby the City is allowed to connect with the District’s sewer lines for $15,000 per year. The agreement is subject to renewal annually. The District recorded lease income of $15,000 for each of the years ended December 31, 2016 and 2015. 22 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 8 – RISK MANAGEMENT Except as provided in the Colorado Governmental Immunity Act, as amended from time to time, the District may be exposed to various risks of loss related to torts, thefts of, damage to, or destruction of assets, errors or omissions, injuries to employees, or acts of God. The District is a member of the Colorado Special Districts Property and Liability Pool (Pool). The Pool is an organization created by intergovernmental agreement to provide property, liability, public officials’ liability, boiler and machinery, and workers compensation coverage to its members. Settled claims have not exceeded this coverage in any of the past three fiscal years. The District pays annual premiums to the Pool for property, general liability, and boiler and machinery. In the event aggregate losses incurred by the Pool exceed amounts recoverable from reinsurance contracts and funds accumulated by the Pool, the Pool may require additional contributions from the Pool members. Any excess funds, which the Pool determines are not needed for purposes of the Pool, may be returned to the members pursuant to a distribution formula. The District maintains commercial insurance for injuries to employees (worker’s compensation). Settled claims have not exceeded this coverage in any of the past three fiscal years. NOTE 9 – TAX, SPENDING AND DEBT LIMITATIONS Article X, Section 20 of the Colorado Constitution, commonly known as the Taxpayer’s Bill of Rights (TABOR), contains tax, spending, revenue and debt limitations which apply to the State of Colorado and all local governments. Enterprises, defined as government-owned businesses authorized to issue revenue bonds and receiving less than 10% of annual revenue in grants from all state and local governments combined, are excluded from the provisions of TABOR. The District’s management believes a significant portion of its operations qualifies for this exclusion. Spending and revenue limits are determined based on the prior year’s Fiscal Year Spending adjusted for allowable increases based upon inflation and local growth. Fiscal Year Spending is generally defined as expenditures plus reserve increases with certain exceptions. Revenue in excess of the Fiscal Year Spending limit must be refunded unless the voters approve retention of such revenue. 23 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 NOTE 9 – TAX, SPENDING AND DEBT LIMITATIONS (CONTINUED) On November 4, 2003, a majority of the District’s electors authorized the District to collect, retain and spend all revenues and other funds received from District rates, fees, tolls, charges, fines, penalties and investments commencing January 1, 2004, for general operations, maintenance, and capital improvements as a voter approved revenue change and exception to the limits which would otherwise apply under Article X, Section 20. The District’s management believes it is in compliance with the provisions of TABOR. However, TABOR is complex and subject to interpretation. Many of the provisions, including the interpretation of how to calculate Fiscal Year Spending limits and qualification as an Enterprise will require judicial interpretation. TABOR requires local governments to establish Emergency Reserves. These reserves must be at least 3% of Fiscal Year Spending (excluding bonded debt service). Local governments are not allowed to use emergency reserves to compensate for economic conditions, revenue shortfalls, or salary or benefit increases. At December 31, 2016 and 2015, the District’s reserve of $34,800 and $25,300 was recorded as a restriction of Net Position. This information is an integral part of the accompanying financial statements. 24 SUPPLEMENTAL INFORMATION SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT SCHEDULES OF OPERATING EXPENSES Years Ended December 31, 2016 and 2015 2016 2015 WATER OPERATIONS Repair and maintenance $ 471,963 $ 477,650 Utilities 28,277 36,450 Engineering and legal 42,732 16,521 Depreciation 713,978 717,061 Amortization 280,675 280,675 Total water operations 1,537,625 1,528,357 SEWER OPERATIONS Repair and maintenance 321,021 280,274 Utilities 17,323 12,888 Engineering and legal 7,702 13,345 Depreciation 772,365 710,757 Amortization 12,084 12,084 Total sewer operations 1,130,495 1,029,348 GENERAL AND ADMINISTRATIVE General office administration Administration 468,895 451,464 Office supplies 1,735 1,682 Other 17,397 14,968 Public Relations 32,743 34,318 Professional and consulting Accounting and audit 5,250 5,250 Legal 37,028 33,246 Other 12,500 12,500 Insurance 12,235 13,023 Building maintenance and utilities 83,609 59,449 Miscellaneous 6,124 4,839 Depreciation 63,015 63,519 Total general and administrative 740,531 694,258 Total operating expenses $ 3,408,651 $ 3,251,963 25 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT SCHEDULE OF REVENUE, EXPENDITURES AND CHANGES IN FUNDS AVAILABLE BUDGET AND ACTUAL (Non-GAAP BUDGETARY BASIS) Year Ended December 31, 2016 Original Variance and Final Positive Budget Actual (Negative) REVENUE Net investment income $ 265,350 $ 96,389 $ (168,961) Tap fees - water 315,000 609,000 294,000 Tap fees - sewer 49,500 160,321 110,821 Charges for services 335,640 291,487 (44,153) Total revenue 965,490 1,157,197 191,707 EXPENDITURES OPERATIONS AND ADMINISTRATION Operations and maintenance - water Repair and maintenance 562,000 471,963 90,037 Utilities 33,600 28,277 5,323 Engineering and legal 39,000 42,732 (3,732) Operations and maintenance - sewer Repair and maintenance 348,000 321,021 26,979 Utilities 12,000 17,323 (5,323) Engineering and legal 12,000 7,702 4,298 General office administration 477,503 488,027 (10,524) Public Relations 37,700 32,743 4,957 Professional and consulting 57,000 54,778 2,222 Insurance 13,750 12,235 1,515 Office maintenance 45,000 54,996 (9,996) Office utilities 32,000 28,613 3,387 Other 8,030 6,124 1,906 Total operations and maintenance 1,677,583 1,566,534 111,049 CAPITAL OUTLAY Water distribution system 11,880 25,555 (13,675) Sewage collection system 839,706 991,028 (151,322) Other 249,000 140,369 108,631 Contingency 156,703 - 156,703 Total capital outlay 1,257,289 1,156,952 100,337 Total expenditures 2,934,872 2,723,486 211,386 EXCESS OF REVENUE (UNDER) EXPENDITURES (1,969,382) (1,566,289) 403,093 FUNDS AVAILABLE - BEGINNING OF YEAR 26,535,046 26,459,146 (75,900) FUNDS AVAILABLE - END OF YEAR $ 24,565,664 $ 24,892,857 $ 327,193 Funds available is computed as follows: Current assets $ 9,513,304 Long-term cash deposits and investments 15,690,035 Current liabilities (310,482) $ 24,892,857 26 SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT RECONCILIATION OF ACTUAL (Non-GAAP BUDGETARY BASIS) TO STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION Year Ended December 31, 2016 REVENUE (BUDGETARY BASIS) $ 1,157,197 Contributed capital assets 593,073 Total revenue per statement of revenues, expenses, and changes in net position 1,750,270 EXPENDITURES (BUDGETARY BASIS) 2,723,486 Depreciation 1,549,358 Amortization 292,759 Loss on asset disposition 14,122 Capital outlay (1,156,952) Total expenses per statement of revenues, expenses, and changes in net position 3,422,773 Change in net position per statement of revenues, expenses, and changes in net position $ (1,672,503) 27 Southwest Metropolitan Water and Sanitation District www.swmetrowater.org 8739 W. Coal Mine Ave. • Littleton, Colorado 80123 • {303) 979-2333 • Fax (720) 726-5042 TO: Board of Directors Southwest Metropolitan Water and Sanitation District FROM: Patrick Fitzgerald DATE: March 20, 2017 SUBJECT: Inclusion of 104.828 acres of property know as Wild Plum Farm Requested Action: Approve Resolution 2017-3-1 Ordering the Inclusion of Real Property (Wild Plum Farm) Wild Plum Farm, LLC has filed a Petition for Inclusion with Southwest Metropolitan Water and Sanitation District for a 104.828 acre tract of land located east of Platte Canyon Rd., west of the South Platte River, south of W. Fairway Lane, and north of the Polo Reserve Subdivision. The property is located within the Town of Columbine Valley which is currently rev1ewmg a rezoning and site development plan consisting of 98 single family residential units. Southwest Metropolitan Water and Sanitation District is capable of providing sewer service to the property by connection to the District's B-line Interceptor and/or C-line Interceptor which either traverse or are located adjacent to the property. Water service will require a connection to a District owned water main in Hunter Run Lane and a secondary connection to a Columbine Water and Sanitation District water main in W. Fairway Lane. A water connection agreement is being pursued with Columbine for permission to make the second connection. A copy of the Petition for Inclusion, Resolution 2017-3-1, and the proposed development plan is attached. DISTRICT COURT, COUNTY OF JEFFERSON 1 STATE OF COLORADO Court Address: Jefferson Combined Court 100 Jefferson County Parkway Golden, Colorado 80401-6002 Phone Number: 303-271-6145 IN RE THE MATTER OF SOUTHWEST METRO POLITAN WATER AND SANITATION DISTRICT 1 Timothy J. Flynn A COURT USE ONLY A Collins Cockrel & Cole Case No.: 61 CV15486 390 Union Blvd., Suite 400 Denver, Colorado 80228-1556 Telephone: (303) 986-1551 Div.: 1 Ctrm.: Facsimile: (303) 986-1755 E-Mail: [email protected] ' Atty. Reg#: 10484 RESOLUTION 2017-3-1 ORDERING THE INCLUSION OF REAL PROPERTY (WILD PLUM PROPERTY) WHEREAS, on or about February 15, 2017, Wild Plum JV, LLC, a Delaware limited liability company ("Petitioner"), being the fee owner of 100% of the real property described on Exhibit A (consisting of three pages) as ~ttached hereto and incorporated herein by this reference (the "Property"), filed a Petition ("Petition") with the Board of Directors of the Southwest Metropolitan Water and Sanitation District ("District") for inclusion of the Property into the District pursuant to Title 32, Article 1, Part 4, C.R.S., as amended; and WHEREAS, Notice of Hearing on the Petition, setting forth the name and address of the Petitioner, and the date, time and place of the public meeting called for the purpose of hearing said Petition, was duly published one (1) titne on Thursday, March 9, 2017, in the Douglas County News-Press and Littleton Independent, and one (1) time on Wednesday, March 8, 2017 in the Columbine Courier, newspapers of general circulation within Douglas, Arapahoe, and Jefferson Counties, respectively, as required by the statutes of the State of Colorado; and WHEREAS, pursuant to said published Notice and§ 32-1-401(2)(b), C.R.S., the Board of Directors of the District considered the Petit}_on on Friday, March 24, 2017, at 8:30 a.m. at the office of the District, located at 8739 West Coal Mine Avenue, Littleton, Colorado 80123; and WHEREAS, no municipality, county or any person residing or owning property within the District has filed a written objection to the granting of the Petition, and no {00553667.DOCX I } person or entity appeared at said public meeting to express or indicate any objection to the granting of the Petition; and WHEREAS, the District's Water Distribution.Contract with the City and County of Denver (acting by and through its Board of Water Commissioners), enables the District to unilaterally enlarge its Contract Water Service Area; and WHEREAS, the Property is located within the District's Contract Sewer Service Area as described in the District's Connectors Agreement with the City of Littleton, Colorado or is capable of being included within said Sewer Service Area; and WHEREAS, the Property is physically capable of being served by District facilities or extensions thereof. NOW THEREFORE, BE IT RESOLVED, by the Board of Directors of the Southwest Metropolitan Water and Sanitation District, Arapahoe, Douglas and Jefferson Counties, Colorado as follows: 1. IT IS HEREBY ORDERED that the Petition for Inclusion of Real Property into the Southwest Metropolitan Water and Sanitation District, Arapahoe, Douglas, and Jefferson Counties, Colorado, filed by the above-named Petitioner is GRANTED, and the Property as described on Exhibit A as attached hereto, which lies within the County of Arapahoe, State of Colorado, is hereby ordered included into the District subject to satisfaction of the following conditions precedent: (a) Verification by the District's Manager that the Petitioner has paid or made satisfactory arrangements to pay all costs and e)}.penses incurred by the District in connection with the processing of the Petition, including the District's inclusion fee. (b) If Petitioner requires sanitary sewer service, the amendment of the District's connectors agreement with the City of Littleton to include the Property into the District's Contract Sewer Service Area. ( c) Execution of a Water Connection Agreement between the District, Columbine Water and Sanitation District, and the City and County of Denver, acting by and through its Board of Water Commissioners that is acceptable to the District. 2. BE IT FURTHER RESOLVED, that upon certification by the District's Manager that all of the conditions precedent set forth above have been met within one hundred eighty (180) days from the date hereof, the District's legal counsel shall cause this Resolution to be filed with the Clerk of the District Court, Jefferson County, Colorado, together with a Motion to the Court for an Order that the Property be included into the District under the proceedings in Civil Action No. 61CVl5486, encaptioned "IN RE THE MATTER OF THE SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT." {00553667.DOCX I } 2 3. Upon inclusion of the Property into the District, the Property shall be subject to all applicable District rules and regulations and all applicable rates, fees, tolls, charges, and taxes, if any. 4. BE IT FURTHER RESOLVED, that a copy of this Resolution shall be affixed to the minutes of this meeting. ADOPTED AND APPROVED this 241h day of March, 2017. SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT By: Anthony M. Dursey, President Attest: George E. Hamblin, Jr., Secretary {00553667.DOCX I } 3 EXHIBIT A , Tract No. 1 A TRACT OF LAND IN THE NORTHEAST QUARTER OF SECTION 30, AND THE NORTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 29, TOWNSHIP 5 SOUTH, RANGE 68 WEST OF THE SIXTH PRINCIPAL MERIDIAN, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF SAID SECTION 29; THENCE NORTH 89°39'53" EAST ALONG THE NORTHERLY LINE OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 29, 1323.47 FEET TO THE NORTHEAST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST Ql'.JARTER; THENCE SOUTH 00°04'46" EAST, A DISTANCE OF 1,318.55 FEET TO THE SOUTHEAST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER; THENCE SOUTH 89°35'21" WEST, A DISTANCE OF 1,320.88 FEET TO THE SOUTHWEST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER; THENCE SOUTH 89 °51 '48" WEST, A DISTANCE OF 659.48 FEET; THENCE SOUTH 00°10'29" EAST, A DISTANCE OF 1,322.10fEET TO A POINT ON THE SOUTHERLY LINE OF THE NORTHEAST QUARTER OF SAID SECTION 30; THENCE SOUTH 89°42'15" WEST ALONG SAID SOUTHERLY LINE, A DISTANCE OF 1,195.97 FEET TO THE CENTERLINE OF THE NEVADA DITCH; THENCE ALONG SAID CENTERLINE OF THE NEVADA DITCH, THE FOLLOWING SIXTEEN (16) COURSES: 1. NORTH 06°38'52" WEST, A DISTANCE OF 97.69 FEET; 2. NORTH 10°59'12" EAST, A DISTANCE OF 56.50 FEET; 3. NORTH 02°06'38" WEST, A DISTANCE OF 217.57 FEET; 4. NORTH 09°35'46" EAST, A DISTANCE OF 13.38 FEET; 5. NORTH 27°39'38" EAST, A DISTANCE OF 49.61 FEET; 6. NORTH 14°36'19" EAST, A DISTANCE OF 60.75 FEET; 7. NORTH 07°28'33" WEST, A DISTANCE OF 108.61 FEET; 8. NORTH 18°17'28" EAST, A DISTANCE OF 89.49 FEET; 9. NORTH 62°09'05" EAST, A DISTANCE OF 118.70 FEET; 10. NORTH 32 °48'44" EAST, A DISTANCE OF 151.13 FEET; 11 . NORTH 24°05'16" EAST, A DISTANCE OF 91.33 FEET; , 12. NORTH 03°38'56" WEST, A DISTANCE OF 101 .66 FEET; 13. NORTH 43°50'17'' EAST, A DISTANCE OF 103.23 FEET; = 14. NORTH 33°05'17" EAST, A DISTANCE OF 110.10 FEET; {00553667.DOCX I } A-1 15. NORTH 36°47'11 " EAST, A DISTANCE OF 142.63 FEET; 16. NORTH 89°51'46" EAST, A DISTANCE OF 42 .77 FEET TO THE SOUTHWEST CORNER OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTE.R OF SAID SECTION 30; THENCE NORTH 00°14'12" EAST ALONG THE WEST LINE OF SAID NORTHEAST QUARTER OF THE NORTHEAST QUARTER, A DISTANCE OF 347.29 FEET; THENCE ALONG THE FOLLOWING EIGHTEEN (18) COURSES: 1. SOUTH 84 °19'37" EAST A DISTANCE OF 27.70 FEET; 2. SOUTH 79 °25'46" EAST A DISTANCE OF 76.98 FEET; 3. SOUTH 83 °56'03" EAST A DISTANCE OF 15.55 FEET; 4. SOUTH 85°23'47" EAST A DISTANCE OF 7.57 FEET; 5. NORTH 85°34'02" EAST A DISTANCE OF 7.72 FEET; 6. NORTH79°22'20" EAST A DISTANCE OF 23.11 FEET; 7. NORTH 57°01'19" EAST A DISTANCE OF 17.48 FEET; ,, 8. NORTH 61 °22'49" EAST A DISTANCE OF 6.84 FEET; 9. NORTH 40°26'40" EAST A DISTANCE OF 6.33 FEET; 10. NORTH 35°16'47" EAST A DISTANCE OF 7.67 FEET; 11 . NORTH 26°57'20" EAST A DISTANCE OF 7.67 FEET; 12. NORTH 19°15'57" EAST A DISTANCE OF 7.74 FEET; 13. NORTH 14°33'11" EAST A DISTANCE OF 7.72 FEET; 14. NORTH 05°19'11 " EAST A DISTANCE OF 6.66 FEET; 15. NORTH 01 °51'47" WEST A DISTANCE OF 6.96 FEET; 16. NORTH 03°48'11" EAST A DISTANCE OF 6.73 FEET; 17. NORTH 17°30'53" WEST A DISTANCE OF 8.77 FEET; 18. NORTH 42°49'43" EAST A DISTANCE OF 172.41 FEET; TO A POINT ON THE CENTERLINE OF SAID NEVADA DITCH; THENCE, ALONG SAID CENTERLINE, THE FOLLOWING ELEVEN (11) COURSES: 1. NORTH 38°37'06" WEST, A DISTANCE OF 65.39 FEET; 2. NORTH 23°39'53" WEST, A DISTANCE OF 43.46 FEET; 3. NORTH 10°40'15" EAST, A DISTANCE OF 40.79 FEET; 4. NORTH 30°26'54" EAST, A DISTANCE OF 79.40 FEET; {00553667.DOCX I } A-2 5. NORTH 21 °36'35" EAST, A DISTANCE OF 47.54 FEET; 6. NORTH 12°38'14" EAST, A DISTANCE OF 91 .66 FEET; 7. NORTH 09°34'39" EAST, A DISTANCE OF 56.79 FEET; 8. NORTH 15°49'03" EAST, A DISTANCE OF 131 .32 FEET; 9. NORTH 07°08'55" EAST, A DISTANCE OF 37.34 FEET; 10. NORTH 16°05'29" EAST, A DISTANCE OF 181 .60 FEET; 11 . NORTH 17°31 '45" EAST, A DISTANCE OF 65.95 FEET TO A POINT ON THE NORTHERLY LINE OF THE NORTHEAST QUARTER OF SAID SECTION 30; THENCE SOUTH 89°58'44" EAST ALONG SAID NORTHERLY LINE, A DISTANCE OF 865.86 FEET TO THE POINT OF BEGINNING. CONTAINING AN AREA OF 104.828 ACRES, (4 ,566,287 SQUARE FEET), MORE OR LESS. JAMES E. LYNCH, PLS NO . 37933 FOR AND ON BEHALF OF AZTEC CONSULTANTS, INC. 300 E. MINERAL AVE., SUITE 1, LITTLETON, CO 80122 303-713-1898 {00553667.DOCX I } A-3 ·,I .. -., . .. .- · · --.'-.-: . .· ·:· ~· - -..::.-". - PETITION FOR INCLUSION OF REAL PROPERTY INTO SOUTHWEST METROPOLITAN WATER AND SANITATION DISTRICT ARAPAHOE, JEFFERSON AND DOUGLAS COUNTIES, COLORADO Wild Plum JV, LLC, a Delaware limited liability company, whose address is 6161 Syracuse Way, Suite 200, Greenwood Village, CO 80111 (hereinafter referred to as "Petitioner"), respectfully petitions the Board of Directors of the Southwest Metropolitan Water and Sanitation District ("District") for inclusion of the real property described below into the District pursuant to the provisions of Part 4, Article I of Title 32, C.R.S., as amended, and all applicable policies, rules and regulations of the District. IN SUPPORT OF THIS PETITION, Petitioner states as follows: 1. The full and correct legal description of the real property which consists of one parcel (hereinafter referred to as the "Property"), th~t Petitioner desires to have included into the District, is as follows: Legal Description One Tract of land identified herein as Tract No. 1 and being more particularly described and depicted on Exhibit "A" (consisting of four pages) which is attached hereto and incorporated herein by this reference. 2. The Property is capable of being served with facilities of the District. 3. Petitioner hereby consents to the inclusion of the Property into the District and understand that from and after the date of any inclusion into the District, the Property shall be subject to all of the District's rules, regulations and policies, and to all of its rates, fees, tolls and charges, and to the extent the Property is taxable, to all of the District's taxes, if any, including, but not limited to any debt service mill levy that may hereinafter be imposed by the District for future bonded1indebtedness. 4. Petitioner represents that it is the fee owner of one hundred percent (100%) of the Property, and that no other person or entity owns an interest therein, except as a beneficial holder of an encumbrance. 5. Petitioner aclrnowledges that the District is not required to enlarge or extend its facilities beyond those currently existing and Petitioner understands that all such enlargements or extensions, when permitted, are nqrmally undertaken by and paid for by the owner or developer of the property to be served. {00550219.DOC I ) .. 1 · 6. Petitioner further understands and agrees that there shall be no withdrawal from this Petition after publication of the Notice of the Hearing to be held thereon, without the consent of the Board of Directors of the District. WHEREFORE, Petitioner requests that the Board of Directors of the Southwest Metropolitan Water and Sanitation District hear this Petition at a public meeting after publication of Notice of the filing hereof, and of the place, date and time of such meeting, as required by law, and that the above-described Property be included into the Southwest Metropolitan Water and Sanitation District, Arapahoe, Jefferson and Douglas Counties, Colorado. Dated this IS& day of /id#-v!Jf-.-1 , 2017. ~ · Petitioner: Wild Plum JV, LLC, a Delaware limited liability company By: Standard Pacific Investment Corp., a Delaware corporation, its Manager . By: ~ / ! ltL. Kent Pedersen Vice President - Land Acquisition ACKNOWLEDGEMENT STATE OF COLORADO ) ) SS. COUNTY OF ARAPAHOE ) ,.... The foregoing Petition for Inclusion was acknowledged before me this / c; day of f=i b{IA tt 1l'\ , 2017, by Kent Pedersen as Vice President - Land Acquisition of Standard Pacific Investment Corp., a Delaware corporation, as Manager of Wild Plum N, LLC, a Delaware limited liability company. Witness my hand and official seal. My commission expires: JENNIFER S. WAITON t1 . J 1· . l _j___ _ NOTARY PUBLIC \Or,{' /,l j~)C:t)-il STATE OF COLORADO NOTARY ID 20144027146 COMMISSION EXPIRES JUL.10, 2018 (00550219.DOC I } 2 EXHIBIT A Tract No.1 A TRACT OF LAND IN THE NORTHEAST QUARTER OF SECTION 30 , AND THE NORTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 29, TOWNSHIP 5 SOUTH, RANGE 68 WEST OF THE SIXTH PRINCIPAL MERIDIAN, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF SAID SECTION 29; THENCE NORTH 89°39'53" EAST ALONG THE NORTHERLY UNE OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 29, 1323.47 FEET TO THE NORTHEAST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER; THENCE SOUTH 00°04'46" EAST, A DISTANCE OF 1,318.55 FEET TO THE SOUTHEAST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER; THENCE SOUTH 89°35'21 " WEST, A DISTANCE OF 1,320.88 FEET TO THE SOUTHWEST CORNER OF SAID NORTHWEST QUARTER OF THE NORTHWEST QUARTER; THENCE SOUTH 89°51'48" WEST, A DISTANCE OF 659.48 FEET; THENCE SOUTH 00°10'29" EAST, A DISTANCE OF 1,322.10 FEET TO A POINT ON THE SOUTHERLY LINE OF THE NORTHEAST QUARTER OF SAID SECTION 30; THENCE SOUTH 89°42'15" WEST ALONG SAID SOUTHERLY LINE, A DISTANCE OF 1, 195.97 FEET TO THE CENTERLINE OF THE NEVADA DITCH; THENCE ALONG SAID CENTERLINE OF THE NEVADA DITCH, THE FOLLOWING SIXTEEN (16) COURSES: 1. NORTH 06°38'52" WEST, A DISTANCE OF 97.69 FEET; ,.. 2. NORTH 10°59'12" EAST, A DISTANCE OF 56.50 FEET; 3. NORTH 02°06'38" WEST, A DISTANCE OF 217.57 FEET; 4. NORTH 09°35'46" EAST, A DISTANCE OF 13.38 FEET; 5. NORTH 27°39'38" EAST, A DISTANCE OF 49.61 FEET; 6. NORTH 14°36'19" EAST, A DISTANCE OF 60.75 FEET; 7. NORTH 07°28'33" WEST, A DISTANCE OF 108.61 FEET; 8. NORTH 18°17'28" EAST, A DISTANCE OF 89.49 FEET; 9. NORTH 62°09'05" EAST, A DISTANCE OF 118.70 FEET; 10. NORTH 32°48'44" EAST, A DISTANCE OF 151.13 FEET; 11 . NORTH 24°05'16" EAST, A DISTANCE OF 91 .33 FEET; 12. NORTH 03°38'56" WEST, A DISTANCE OF 101 .66 FEET; 13. NORTH 43°50'17" EAST, A DISTANCE OF 103.23 FEET; = 14. NORTH 33°05'17'' EAST, A DISTANCE OF 110.10 FEET; {0055 02 19.DOC I } A-1 15. NORTH 36°47'11" EAST, A DISTANCE OF 142.63 FEET; 1 16. NORTH 89°51'46" EAST, A DISTANCE OF 42.77 FEET TO THE SOUTHWEST CORNER OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF SAID SECTION 30; THENCE NORTH 00°14'12" EAST ALONG THE WEST LINE OF SAID NORTHEAST QUARTER OF THE NORTHEAST QUARTER, A DISTANCE OF 347.29 FEET; THENCE ALONG THE FOLLOWING EIGHTEEN (18) COURSES: 1. SOUTH 84°19'37" EAST A DISTANCE OF 27.70 FEET; 2. SOUTH 79°25'46" EAST A DISTANCE OF 76.98 FEET; 3. SOUTH 83°56'03" EAST A DISTANCE OF 15.55 FEET; 4. SOUTH 85°23'47" EAST A DISTANCE OF 7.57 FEET; 5. NORTH 85°34'02" EAST A DIST ANGE OF 7. 72 FEET; 6. NORTH79°22'20" EAST A DISTANCE OF 23.11 FEET; 7. NORTH 57°01'19" EAST A DISTANCE OF 17.48 FEET; 8. NORTH 61°22'49" EAST A DISTANCE OF 6.84 FEET; 9. NORTH 40°26'40" EAST A DISTANCE OF 6.33 FEET; 10. NORTH 35°16'47" EAST A DISTANCE OF 7.67 FEET; 11 . NORTH 26°57'20" EAST A DISTANCE OF 7.67 FEET; 12. NORTH 19°15'57" EAST A DISTANCE OF 7.74 FEET; 13. NORTH 14°33'11" EAST A DISTANCE OF 7.72 FEET; 14. NORTH 05°19'11" EAST A DISTANCE OF 6.66 FEET; 15. NORTH 01°51 '47" WEST A DISTANCE OF 6.96 FEET; 16. NORTH 03°48'11" EAST A DISTANCE OF 6.73 FEET; 17. NORTH 17°30'53" WEST A DISTANCE OF 8.77 FEET; 18. NORTH 42°49'43" EAST A DISTANCE OF 172.41 FEET; TO A POINT ON THE CENTERLINE OF SAID NEVADA DITCH; THENCE, ALONG SAID CENTERLINE, THE FOLLOWING ELEVEN (11) COURSES: 1. NORTH 38°37'06"WEST, A DISTANCE OF 65.39 FEET; 2. NORTH 23°39'53" WEST, A DISTANCE OF 43.46 FEET; 3. NORTH 10°40'15" EAST, A DISTANCE OF 40.79 FEET; 4. NORTH 30°26'54" EAST, A DISTANCE OF 79.40 FEET; {00550219. DOC I } A-2 ·.:.I ·--···--·------·-·--- 5. NORTH 21°36'35" EAST, A DISTANCE OF 47.54 FEET; 6. NORTH 12°38'14" EAST, A DISTANCE OF 91.66 FEET; 7. NORTH 09°34'39" EAST, A DISTANCE OF 56.79 FEET; 8. NORTH 15°49'03" EAST, A DISTANCE OF 131.32 FEET; 9. NORTH 07°08'55" EAST, A DISTANCE OF 37.34 FEET; 10. NORTH 16°05'29" EAST, A DISTANCE OF 181.60 FEET; 11 . NORTH 17°31 '45" EAST, A DISTANCE OF 65.95 FEET TO A POINT ON THE NORTHERLY LINE OF THE NORTHEAST QUARTER OF SAID SECTION 30; THENCE SOUTH 89°58'44" EAST ALONG SAID NORTHERLY LINE, A DISTANCE OF 865.86 FEET TO THE POINT OF BEGINNING. ~ CONTAINING AN AREA OF 104.828 ACRES, (4,566,287 SQUARE FEET), MORE OR LESS. JAMES E. LYNCH, PLS NO. 37933 FOR AND ON BEHALF OF AZTEC CONSULTANTS, INC. 300 E. MINERAL AVE., SUITE 1, LITTLETON, CO 80122 303-713-1898 t ' (00550219.DOC I } A-3 .:::.._~~~-- ,_.,.._,j PRELIMINARY PLAT WILD PLUM A PART OF THE NE 1/4 OF SECTION 30 AND THE NW 1/4 OF SECTION 29. TOWNSHIP 5 SOUTH. RANGE 68 WEST OF THE SIXTH PRINCIPAL MERIDIAN, COUNTY OF ARAPAHOE. STATE OF COLORADO. 104.828 ACRES - 95 RESIDENTIAL LOTS - 7 TRACTS SB __ - __ LO«""' UHt 8£AIW4C 1.ENClH LI l'IOll'lll'll"W ''-"9' ~Ttft&~ __! sccr.cws 2062!1, l2 M10'5S'12"t. :wi.Xr 13"1.lfUW. 11).1 '""- l..l"l~'l8"'w"11.s:r' L4 N0'9'~·~ 13.J.!_ '; ~ :--=----sasi¥ I ..e'"""E I j6iM·~~ 74159"J9'5J'l:I J q+HfI I - 1~1L~~~ _ _ -1-=~~ m01· ______------~ ...-,..~~-- ~ N21'l9'Jn: ;1· ~ ! 29:J~WIJ2.J.-f7-1 lA I Nl'l"J!l'l!!"l. .,_,,.. 'llVlC DHC£ £ASEMDff NOllTH '/' COR_ 5£"C71Cl I I~ ~( NJtrJ!l"'11°W 65..60' : I NLY.W'U"w 4..l.~" I~I I! L.J7 N10"4Cl'1~"E § I ,Fl N.JG"Jf;'!>4"'f. ~ I !Qt".:5".X>""f 147.5-t' N1~".J.11"14"'E i~ J NC'i'J•'.l9"£ I NH1"'19'0J"E 1l,.J2' ~sr'/1z.a:wRs/,ic,"i: P.1;_ 1 \ '- ~- N07-~E l7.J.4' NOTrtlt-"" -F ... 1.UINl.AIC(" I 1 Nl(i"t)5'2S"'f. 1auo· /,tl(),-POHi~ ~ Ar '"''"''"c,."""!L N.l01l'.$$'£ •2.IM" • ~rl.l'Ccrscc1'0N29 "f..n'l"Y:i.._25.4.~_ _ _ 1 1 ______7 N:r Jt'45"( 15.!I~' , ...'11 LN69""4-2'15~ rnis.97' ,,,; I ------::;1 ------COiTFR '/4 CCR.. scc110N 21. TH:'.PO..ORaCRV! ------!-.. r.s5;HUtr&1HP.M. Pa..ORloa:FAA! 4SFUil CN0.1 SW Cl:l'l, ~ll'GWn. ~ f'O(.M? /6 f1awr If'/ at<.!18,PC.40-42 f5l l"MW. 6/H P.11. J-f/ ·f" ALllM/HUIJ CAP O'l/24/IH~ an or UTTI..ETCH f"CXIND~ R£1JAP STAMPQ; 'l.S 16-tor J- 1/"" ALWINUU CAPW/+ """" STAIQ'£D ~S 25M4 '" i:.'l~;.\J\E.\d -;or· ..·~ lr.JMJOIKJJMFIJT AnrlD'CM:.u.rilllC t _... _ om~ 1. DEVELOP ER A. AzTEc~-::;:..::-·CalAUanlic ~LTAATS.INC.~"!'!1'~-.- .,. ~ y " - T 6161 5. 5"J1V.CUSEw>.Y , SIJUE 200 ~wooo \1U...-.c£, co eo111 A.f .. ""'1- ... •- .:o~-~e-~112 PREUMINARY PLAT WILD PLUM A PART OF THE NE 1/4 OF SECTION 30 AND THE NW 1/4 OF SECTION 29, TOWNSHIP 5 SOUTH, RANGE 68 WEST OF THE SIXTH PRINCIPAL MERIDIAN, COUNTY OF ARAPAHOE, STATE OF COLORADO. 104.828 ACRES - 95 RESIDENTIAL LOTS - 7 TRACTS SB____ - ---- LI N06'38'!i2"W 97.H' L2 1rno~·1n: 56.!>0' 217.57' L4 N09'J!i'46"( \ J.39' L!i N27'J9'J.e"[ 4!UI' ~ --W=~.l~M=------1 L6 N14'39 '11n --,----.__.~~Q:l ••7 L7 N0r211'JJ"W 1015.&f (II< . ~111. •c 2.15 Lii N1S'17'21!1"[ 1!!149' 9URMNC TR[[ AT COlUl.$NC LI N621>9'05"[ 1111.70' THRO r1LINC BK. J7,PC.4-0 NJ2'48'H"E OJ/07/1979 N24~'16"El91.J3' NOYJll':.6"W 101.66' N4J-:>0'17"E 10J.2J' "' NJJ'O!i'\7"[ 110.10' "' N36'47'!2"( 142.tll ' "' Nll9°!>n6"[ 42.77' CITY~~~ElON "' "' S84, 1'• 2"Cf27 .!il' S79'29'41"El77.~' ' r-'" S&4111'!i2"£!2J.lll' ''''"" '· Newsne·c1 Hi!i' ""'"""""" N19·31·2o·c I uoY TRACT A rLOOOIY.lYc.-.sc11nn __.,/ PAA«l,U •1• f[ N!i7'09'17"( 17.57' B~. ~7t. ,C 2J> i~ 0 ) N 6.~· ,~ ------...... p "140"46°J2"tl 6.42" ----- _::_~~!~~1_- NJ!i16'07"[ S... NIU.RYS(W[R ----- ~ sa9·-3s·21·wt 1320.BS' ~ N26~'36•C 0 =~1r~~ Nli1~JJ"£ "' N15"05"07•( /'\.. 1/4 SEC. 211, T.55., R.6111"., Sm'H P.W. "' "' N05"4J'J4"( N01~'J2"W "" NOY06"J5"E I 6.ao· '" N1TJ5"J5"W j 8.69' DETAIL "A" SCALE: 1";20' "' N42"46'57"C 172.4\' I " NJ8"J7°06"W 65.Jll" " N2J"Jll'5J"W I 43.46" \ .)~ '" N\0"40'15"( I ~j NJ0"26'54"Cl 711.40' I N21'J6"J5"Cl47.!>4' ~ N12"36'14"E l91.66 ' I ,./!J N09'J4'Jll" Cl56 .7!1' I N15'41l'OJ"E l1J1 .J2' \ ""' N07'08'55"ClJ7 .J4' I 19 L20_ N16"05'211"[ N17"J1'45"Cl6 5.115' ---'------'-----'---,-,"1<:.-;j\~ l~i... J ---~-~- TRACTA I ~------! ------___J TH( P<:l.O RCSCR~ POl,.0 RIOCC r.\RlofS fll.ING NO. 1 OTY :J_t~ClON I SIC. 1\8. Pc;. 40- 42 I I 01/24/11195 r.f:'11f'fl (OB fll'fA'41)(11/(liAl.F(T ANCCa:w:!w:lN1!$11C OAf'EOI' l __ .. ___ lll DEVELOPER -~~ f &.AZTEC-·-·-·"··-· DEVELOPER CONSULTANTS. INC . ~d~~:.r.- ,. 7 T T - T OCVSTl!t:C!ADORCSS S~CMl(R(,COLOR.t.DO ...... -i""" Mo-• {JOJ)6811-6868