Town of Delaware, NY Callicoon Water District Map, Plan and Report TEXT 1.0 INTRODUCTION…………………………………………………………………………………………….………1 2.0 EXISTING COMMUNITY WATER SYSTEM……………………………………………………….……… 3 3.0 PROPOSED NEW DISTRICT…………………………………………………………………………….……….7 4.0 DESCRIPTION OF FACILITIES – NEEDED IMPROVEMENTS…………………………….………….7 5.0 PROPOSED DISTRICT OPERATIONS………………………………………………………………….…...10 6.0 REGULATORY REVIEW AND APPROVAL REQUIRED PRIOR TO CONSTRUCTION….....11 7.0 MAXIMUM AMOUNT TO BE EXPENDED…………………………………………………………….….11 8.0 DETAILED EXPLANANTION OF COSTS……………………………………………………………….…...12 9.0 COST TO THE TYPICAL PROPERTY………………………………………………………………………....15 10.0 METHOD OF FINANCE……………………………………………………………………………………….....16 11.0 STATEMENT AS TO BENEFIT ASSESSMENT………………………………………………..….…..…..16 APPENDICES April 2, 2018 i Town of Delaware, NY Callicoon Water District Map, Plan and Report Appendices Appendix A Callicoon Water Company – NYS Department of State Incorporation Record Appendix B NYS EFC DWSRF 2018 IUP Listing Appendix C Water System Map Proposed Water District Map Proposed Water District Parcels Appendix D Complete SEQR Packet with Resolutions Appendix E NYS Comptroller’s Office 2018 Special Districts Memo • Notice of Hearing Requirements for the establishments of town Special Districts • FAQs on the Establishment of Town Special Districts Appendix F Sullivan County Office of Real Property Tax Services Parcel Reports Appendix G FEMA Map Panel No. 36105C0243F Appendix H Formation, Financing, and Implementation Schedule Appendix I Hardship Letter from NYSEFC, dated 01/03/2018 Appendix J Detailed Cost Estimate April 2, 2018 ii Town of Delaware, NY Callicoon Water District Map, Plan and Report Appendix K Additional Information on EDU Calculations Appendix L 2015 Callicoon Water Company Profit & Loss Statement 2016 Callicoon Water Company Profit & Loss Statement 2017 Callicoon Water Company Profit & Loss Statement Appendix M Callicoon Water Company -Rate Structure for Single Family Homes April 2, 2018 iii Town of Delaware, NY Callicoon Water District Map, Plan and Report 1.0 INTRODUCTION The Hamlet of Callicoon, located in the Town of Delaware in Sullivan County NY, is served by a 100+ year old, privately held, public water system. All but a few of the homes and businesses in the Hamlet are served by the water system. Lack of access to needed capital for system maintenance and upgrades has made it increasingly difficult for the owner to meet regulatory mandates. As such, the Company has requested that the Town of Delaware assume ownership of the system. This will allow for increased access to state and federal funding needed to bring the system into regulatory compliance. The Town has commissioned Delaware Engineering, D.P.C. to prepare a Map, Plan and Report (MP&R) to assist the Town in making an informed decision as to the public benefit of forming a special water district. Established in 1904, the community water system is owned by the Callicoon Water Company (CWC), a private corporation. The New York State Department of State Incorporation Record is included as Appendix A in this report. The water company has 168 accounts, serving both domestic and commercial users, and provides fire protection to the Hamlet. The system has been assigned the Public Water Supply ID# NY5203321 by the New York State Department of Health (NYSDOH). Because the system is a privately held company, water rates are subject to the approval of the New York Public Service Commission (NYPSC), which has budgetary review and approval authority over all water company expenditures and proposed rate increases. Water rates have been fixed for the last seven years. If the Town assumes operation of the utility, it would no longer be subject to Public Service Commission oversight. The Hamlet’s water system is also subject to the regulatory authority of the New York State Department of Health (NYSDOH), New York State Department of Environmental Conservation (NYSDEC) and Delaware River Basin Commission (DRBC), and will continue to be following district formation. Historically, the CWC has been unable to collect sufficient revenue to fund a capital reserve budget for infrastructure upgrades and improvements. Due to the increased costs associated with regulatory compliance and maintenance of the 100+ year old water system, the CWC has requested that the Town of Delaware assume ownership of the water system. Establishing the new water district would increase the likelihood of the Town obtaining state and/or federal funding to address system deficiencies. In accordance with NYS Town Law 12-A, the Town of Delaware commissioned Delaware Engineering, D.P.C. to prepare a Map, Plan, and Report (MP&R) and to assist with the district formation process. As part of this process, a project has Page 1 April 2, 2018 Town of Delaware, NY Callicoon Water District Map, Plan and Report been identified which will enhance the reliability of the system and ensure compliance with regulatory standards. The project was identified in a 2017 Engineering Report, prepared for the Town by Delaware Engineering, D.P.C, and in this MP&R. The project is currently listed on the NYS Environmental Facilities Drinking Water State Revolving Fund 2018 Annual Intended Use Plan (NYS EFC DWSRF 2018 IUP), which is the first step in applying for state funding for the project. A copy of the NYS EFC DWSRF 2018 IUP listing is included as Appendix B in this report. Forming a special improvement district, whereby a specified area within a town receives services beyond what other town residents receive (e.g. water service), is permissible under NYS Town Law (Article 12 & 12-A). Residents within this district will be levied a separate user charge for this additional service. Currently, residents residing in the Hamlet of Callicoon pay water fees to the Callicoon Water Company (CWC). If the district were to be formed, the Town would acquire the CWC water facilities and assume control of operations and billing for utility service charges. Forming a special improvement district is a multi-step process which will take several months. The initial step is for the Town to prepare a Map, Plan, & Report (MP&R) which will identify the limits of the district, the existing infrastructure that is in place, the upgrades necessary to meet current regulatory standards, estimated costs and financing for the upgrades (grants/loans), operations and maintenance (O&M) costs, and estimates for the fees that will be charged to the users to provide this service. Appendix C of this report includes a map of the existing water system, a proposed district map and a comprehensive list of parcels to be included in the new water district. If the MP&R is acceptable to the Town, a public hearing will be held to review the Report with residents that would be affected by district formation. If the residents and the Town are in favor of doing so, the district could be formed following approval of the Town Board. District formation is subject to permissive referendum. Pursuant to Article 8 of the New York State Environmental Conservation Law and its implementing regulations contained in 6 NYCRR Part 617, formation of the district is also subject to the requirements of the State Environmental Quality Review Act (SEQRA). At its regularly scheduled January 10, 2018 meeting, the Town Board unanimously passed Resolution #4-2018 Declare Intent to Serve as Lead Agency (SEQR) for Creation of a Special Improvement District and to Affect System Repairs Needed to Bring the System into Regulatory Compliance. A certified copy of this resolution along with all related SEQR documentation is included in Appendix D of this report. The Board determined the action to be Type 1, requiring a coordinated review with potentially involved agencies. Involved agencies are those agencies that have discretionary authority over a proposed project. For this project those agencies would include the NYS DOH, NYS DEC and the DRBC. A complete list of agencies contacted as part of this review and a copy of Page 2 April 2, 2018 Town of Delaware, NY Callicoon Water District Map, Plan and Report the Full Environmental Assessment Form is included in Appendix D of this report. The purpose of the coordinated review is to identify any potential negative environmental impacts that may result from the Board’s action. Following notification to the other involved agencies, and upon receiving no objections, the Board completed the required State Environmental Quality Review. Subsequently, at its regularly scheduled February 14, 2018 meeting, the Town Board passed Resolution #16-2018 Adopt A Negative Declaration for the Hamlet of Callicoon Water Supply Project. A certified copy of this resolution, included in Appendix D, was submitted for publication in the New York State Department of Environmental Conservation’s Environmental Notice Bulletin. Formation of the water district may also be subject to the approval of the NYS Comptroller’s Office. The need for Comptroller approval is dependent on the final user rates that will be levied, the financing plan for the improvements, and input from the residents that will be served. At a minimum, the Comptroller’s office will need to be notified of the district formation, with documentation as to how it was formed, so that it can be recorded in state files. A copy of the New York State Comptroller’s Office 2018 Special Districts Memo is included in Appendix E of this report. If and when the district is established, it is recommended that a water code be written and incorporated into the Town Code. The water code will identify how water rents will be set and collected, terms of service connections, user requirements, etc. The CWC holds title to the real property where the springs, wells and storage facilities are located. Formation of the district will require the transfer of all assets, including real property, to the new Town Water District. A complete list of real property assets is included in Section 8 of this report.