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Conservation Commission - 09/14/2010 APPROVED MINUTES CONSERVATION COMMISSION MONDAY, SEPTEMBER 14, 2010 7:00 PM, CITY CENTER Prairie Room 8080 Mitchell Road COMMISSION MEMBERS: Laura Jester(Chair), Greg Olson (Vice Chair), Sue Brown, Ray Daniels, Ravi Jaiswal, Geneva MacMillan, Prashant Shrikhande STAFF: Regina Herron, Staff Liaison Jan Curielli, Recording Secretary Sue Kotchevar, Finance Manager Gene Dietz, Director of Public Works Leslie Stovring, Environmental Coordinator STUDENT REPRESENTATIVES: Joshua Auerbach and Rachel Wood GUESTS: Barbara Kaerwer Annette Agner, Budget Advisory Commission Grant Meyer, Advanced Engineering & Environmental Services, Inc. I. CALL TO ORDER/ROLL CALL Chair Jester called the meeting to order at 7:10 PM. Brown, Jalswal and MacMillan were absent. II. WELCOME AND INTRODUCTIONS Jester welcomed the guests and the new student representatives. III. APPROVAL OF AGENDA Jester moved Item XI.A. Nine Mile Creek Water Resource Center—Project Status before Item IV. Olson added Item VIII.A. Shrikhande added Item VIII.B. MOTION: Olson moved, seconded by Shrikhande, to approve the agenda as amended. Motion carried 4-0. XI. NEW BUSINESS (taken out of sequence) A. Nine Mile Creek Water Resource Center—Project Status Jester said Barbara Kaerwer wants to donate her home and five acres of property to the Nine Mile Creek Watershed District(NMCWD) to develop an educational center and a headquarters for the NMCWD. The City has indicated that such a change will require a guide plan change from Low Density Residential to two new designations: Conservation Commission Minutes September 14, 2010 Page 2 Parks, along the property edges; and Public/Quasi-Public, at the center of the site where the current house is located and along the driveway and parking areas. She said the Planning Commission reviewed the proposal and recommended the guide plan change by a unanimous vote. Jester thought it is within the purview of this commission to have a say on this and possibly recommend it to the City Council. This is a great use of the property because it is for an educational water resource center for anyone, and it will have a lot of best management practices to handle storm water on site. Olson noted Ms Kaerwer's neighbors are in favor of it, by and large. Ms Kaerwer said there are 188 in favor and five against. Daniels asked where the property is located. Ms Kaerwer said it is the northeast corner of Eden Prairie. Dietz showed a slide that outlined the area. Olson noted the west side of the property is adjacent to wetland. Ms Kaerwer said since 1983 the property has been in a land trust as part of a conservation easement. She noted some people have been concerned that the change would cause a big problem with traffic. There will have to be some trees cut down to allow for the 12-car parking area plus overflow parking;however, a tree count of the property showed there are over 1000 mature trees. Olson asked how many people will be working there. Kaerwer said there will be two people, one of whom was just hired. Kevin Bigalke has been alone up until now. He works with Ms Stovring and the other watershed districts in Eden Prairie. Olson asked how frequently meetings would occur at the new facility and if they will host conferences there. Kaerwer said they will have two or three meetings a month, but conferences would be held at City Hall. Herron reviewed the Planning Commission's recommendation, noting the property is guided low density residential and is in a single family zoning district. The handout about the proposal shows the area to be in parks and open space, and the house and driveway would be public/quasi-public land use. Kaerwer said the conservation easement goes with the land, so if there was a change of hands the property use would have to be conservation-based. Jester asked if this is something we can or should take formal action on. Olson said he would feel confident doing that. Daniels agreed. Jester distributed a draft letter to the City Council recommending the guide plan change. MOTION: Olson moved, seconded by Daniels, to send the letter drafted by Ms Jester to the Eden Prairie City Council. Motion carried 4-0. Kaerwer noted the NMCWD wants to have a demonstration of a permeable surface in the parking area. Conservation Commission Minutes September 14, 2010 Page 3 Wood said she is familiar with the area and thought this would be very beneficial and educational. IV. SPEAKER A. Eden Prairie Utility Rate Study Presentation—Grant L. Meyer, PE Advanced EnOneerins! and Environmental Services, Inc. (AE2S) Grant Meyer, representing AE2S, distributed copies of a PowerPoint presentation on the water, sewer, and storm drainage utility rate design study completed by AE2S . Kotchevar said the rate study was presented to the Budget Advisory Commission (BAC) to give them an opportunity to provide feedback. Tonight Mr. Meyer and staff are presenting it to the commission for their feedback. Meyer said there is a lot that goes into the water infrastructure in terms of the operation, maintenance, replacement/refurbishment, regulatory compliance, meter reading, invoicing customer service and administration for the 19,000 accounts in Eden Prairie. He said cities have their own water treatment,but waste water treatment is done by MCES. Each city pays their share of the waste water fees. He said storm drainage is gaining more recognition throughout the country, so there is a lot of regulatory change and a lot of infrastructure improvement being done for storm water drainage. He showed a slide comparing the combined utility rates for the metropolitan area with Eden Prairie as the second lowest rate. Meyer reviewed the objectives of the study: to determine seasonal irrigation costs; to develop capital improvement programs for utilities; and to prepare a ten-year revenue adequacy evaluation model and develop rate adjustment predictions. He said their Cost of Service Analysis (COSA) showed that 35% of the cost of the water utility system is for irrigation-only accounts while only 28% of the revenue comes from that type of account. Based on their analysis of the assets in the system, they calculated a recommended annual reinvestment amount which was then used to determine revenue adequacy and proposed rate adjustments. They recommended a 90-day operating reserve, a bond reserve equal to the following year's debt payment, a two-year capital reserve for water and sewer and a one-year storm drainage capital reserve. Meyer reviewed the rate projection scenarios developed and the utility balances that would result from each of the scenarios. Shrikhande noted a fixed charge is not an incentive to conserve water, and it is a disincentive if the base rate goes up. Jester thought there are minimal costs to have access to water. Daniels noted he uses a very minimal amount of water, and he will have a big increase in his rate as a result of the proposed changes. Kotchevar provided a spreadsheet showing the number of customers who will be in each of the proposed tiers of the block rate structure. Stovring said in the block rate Conservation Commission Minutes September 14, 2010 Page 4 structure only 1% will be in the $4.30 rate tier. She noted the current baseline is 36,000 gallons. Jester asked if the BAC recommended Scenario 2. Kotchevar said they recommended accepting the study. Shrikhande suggested the first, and biggest, tier be broken down further in order to encourage conservation. Dietz said they discussed having smaller brackets. When the surcharge was put in place, the base was set at the winter use and another rate kicked in after the use went to 150% of the base. He said we are the second lowest in our rates, and we need to generate more income. We need to generate at least as much revenue as we do today in the lower tiers and 35,000 gallons or less is very low usage. Shrikhande suggested the first tier be set at 24,000, which is the average use, and drop the rate for those below 24,000. Olson thought that would incentivize customers to use less than 24,000 gallons. Stovring asked what most cities in the survey had for the first tier. Meyer said it was all over the board. He said the DNR just states there must be a conservation-type rate structure in place. Jester asked if this is the right time in the process to make changes as it is going to the City Council next week. She didn't know what recommendation staff was looking for from this commission. Dietz said if the commission came to an agreement that we should have more tiers or make other recommendations, those would be taken into consideration. Jester thought the message back to the Council may be that we don't feel the scenario promotes conservation. Daniels thought the scenario gets at the top tier and that is where we want to go. He thought putting a cap on the usage of water will help but getting the rate structure through the Council could be a challenge. Jester asked if there is a way to combine both of the recommendations and say this commission believes it is a step in the right direction and we agree with Scenario 2, but we also believe there is more room to incentivize conservation. Dietz said we will look at this on an annual basis and could report back to the commission every year. Olson said the rate structure is trying to get at conservation,but he was not satisfied it gets at it as effectively as it could. He said he has some concerns about provisions in the rest of the document. Stovring said there is also the question of going to monthly billing rather than quarterly billing. There is additional administrative cost with that type of billing. Wood suggested having more tiers on the bottom but less difference between the tiers. Shrikhande thought we might maintain the revenue that way. Meyer noted the tools are there once we put a rate tier in place. He said it will give us a chance to look Conservation Commission Minutes September 14, 2010 Page 5 at the five tiers, see what we have accomplished, and then determine what it would take to influence change. MOTION: Olson moved, seconded by Jester, to recommend to the City Council that the commission agrees in principle with the idea of a block rate structure but that the City should look harder in the different gradients to ensure the objective of conservation is achieved. Daniels thought we should be very clear if we want the block rate structure. Shrikhande said he feels strongly that it may be a hardship to pay a higher rate for some customers who are on a fixed income. He would like to see another scenario run with more tiers and a lower rate. Kotchevar said this study will be presented along with the commission's recommendation and the Council will decide. AMENDMENT TO THE MOTION: Shrikhande moved, seconded by Jester, to add "at the usage levels" before the words "in the different gradients." Motion carried 3-1-0, with Daniels opposed. VOTE ON THE MOTION AS AMENDED: Motion carried 4-0. Meyer reviewed the sewer and storm drainage adjustment scenarios. Daniels asked why there is a drop off in reserves for the years 2011-2013. Dietz said we are currently spending $2,500,000 over a five-year period for Inflow and Infiltration (I&I). Jester said she would like to see some innovative approaches on the storm water drainage and would like to see what other cities are doing to incentivize lower storm water drainage. Stovring said we are already very cheap. Jester thought there may be different incentives we can use. Daniels asked about the rates for the industrial and commercial level. Dietz said he thought those are also cheaper. He noted we raised the rate this year for the first time in many years. Daniels thought there probably isn't as much we can do there in terms of conservation. Dietz said Ms Stovring has a lot of education programs. Stovring said a lot of what we are spending money on is cleaning and maintaining ponds. Jester thought we could increase the charge and have more money for the incentive programs. Shrikhande asked if any community does storm water drainage by acreage. Meyer said some do,but that would be a huge step backwards for Eden Prairie. Stovring said when it was first set up we looked at pervious versus impervious surfaces. Dietz noted we have studied this, and commercial/industrial is subsidizing residential. He said there is also a quality factor involved. Shrikhande asked if we have looked at a rate structure for residential storm drainage. Dietz said he didn't see that as a possibility because of the small amount involved. Conservation Commission Minutes September 14, 2010 Page 6 Jester thought we could educate people to understand the link between their lot and water quality in general. Meyer reviewed the recommendations made in the study. Olson asked about the recommendation to develop independent water and sewer utilities and how those would be accountable to the public. Meyer said a lot of municipalities have separate structures and the recommendation is to account for them separately. Kotchevar noted this is an accounting recommendation and a better word might be "separate" water and sewer utilities. Dietz said the City Council is the governing authority. Up until now all the money from sewer and water coming into the Public Works operation has gone into one box where it is comingled. Separating the water and sewer utilities would ensure the amounts paid for water are used for upkeep of that system. Shrikhande said he agreed with incentivizing things such as pervious pavers, and he thought the rate structure is a very effective way to affect usage. He thought we should look at land use as well. Stovring said we did a growth analysis of pervious versus impervious when we did the non-degradation study. Dietz asked the commission for their thoughts on monthly billing. Kotchevar said it would cost about$150,000 more to go to that type of billing. Jester thought it is an additional headache for residents along with the extra cost to the City. Olson thought it seems like it would be a rather small amount to pay each month,but users would be able to see their usage every month and would get educated that way. He thought we might look at bi-monthly billing, and it would be helpful if users could look up their water usage on the intemet. Kotchevar said the history is on line but it is quarterly. Daniels thought a monthly bill would be a very small amount for those customers who don't use a lot of water. He also thought a monthly bill might help to reduce the number of complaints coming in if the rate structure is passed. V. MINUTES A. Minutes for the August 2, 2010 Joint Workshop MOTION: Olson moved, seconded by Daniels, to approve the minutes of the August 2, 2010 Joint Workshop as published. Motion carried 4-0. B. Minutes for the August 2, 2010 Meeting Jester made two corrections on Page 2, Paragraph 2. The first sentence should be "Olson thought the speaker from Three Rivers was interesting and asked if there is a state mandate driving the creation of raingardens and other infiltration projects." The last sentence should be "Jester said that requirements only come when there is new development or redevelopment." MOTION: Daniels moved, seconded by Olson, to approve the minutes of the August 2, 2010 meeting as amended. Motion carried 4-0. Conservation Commission Minutes September 14, 2010 Page 7 VI. REPORTS FROM STAFF A. Introduction of Student Representatives Herron said both of the student representatives are juniors and will serve on the commission for the entire school year. B. Driveway Material Ordinance Update Herron said the Planning Commission recommended the driveway material ordinance to the City Council, and it is on the September 21 Council agenda. She said the Planning Commission discussed whether to make changes to the ordinance to state how the driveway surface is to be laid out and installed. They decided that information should go into a brochure because it would be easier to make changes to the brochure. Jester noted the staff recommendation still does not mention infiltration. Herron said she must have attached the wrong version. Jester asked if this will go to the City Council with infiltration mentioned. Herron said it will. Daniels asked if all the driveways that have pavers will be grandfathered in. Herron said they will be in compliance with the code. VII. REPORTS FROM CHAIR VIII. REPORTS FROM COMMISSION A. Article on Water Scarcity—Olson Olson distributed copies of an article from UBS regarding water scarcity. B. Report on Presentation— Shrikhande Shrikhande said Ms Stovring gave a presentation at his company and it went very well. IX. REPORTS FROM STUDENTS X. CONTINUING BUSINESS A. Upcoming City Projects and Development—Project Profile Herron said there are no new projects on the project profile. Stovring noted the landscape code was changed for the Cargill Foundation building. They wanted to use native landscaping on the right-of-way, and the code was changed to allow that. She Conservation Commission Minutes September 14, 2010 Page 8 said the property has to have a certain size right-of-way to be allowed to do that. She will give more information to Ms Herron to send around to the commission. B. Ideas for Life in the Prairie Newsletter Olson asked if it would be premature to put in something about pervious pavers. Stovring said we could put it in the next edition of the Environmental Times that will be included in the utility bills. Olson said he would put something together for that. C. Website Content Stovring said we put up the link to the EPA article on climate change, and we can put up information on the permeable pavers. Jester noted we talked about Stu Fox getting a PowerPoint together on raingardens and permeable pavers according to the minutes from last month's meeting. Daniels said recently the Sun Current had a good article on a rain garden recently. XII. INFORMATIONAL MATERIALS/HANDOUTS XIII. UPCOMING EVENTS A. City Wide Open House—Saturday, October 9, 2010 Herron said every two years City Hall is opened up and department staff provides information about what they do. She said the Conservation Commission would be welcome to have a table at the event. Shrikhande said he could attend but would like another commission member to be there with him. Stovring noted we have a supply of reusable bags to give out. Jester said we talked about having reusable water bottles, and we now have a display available. She said we are lacking some information for the display but that is a work in progress. She thought Ms Brown might be interested in being there to help Mr. Shrikhande at our table. Stovring noted she has two classes listed in the new Community Education bulletin. One is on the subject of shoreland restoration and the other on winter maintenance. XIV. NEXT MEETING A. Tuesday, October 12, 2010 XV. ADJOURNMENT MOTION: Olson moved, seconded by Daniels, to adjourn the meeting. Motion carried 4- 0. Chair Jester adjourned the meeting at 10:10 PM.