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2014-07-09 Budget Hearing(::�E I ' LA O4*, - IDAH CITY OF MERIDIAN CITY COUNCIL MEETING AMENDED AGENDA SPECIAL MEETING AGENDA BUDGET WORKSHOP Wednesday, July 9, 2014 at 10:00 a.m. City Council Chambers 33 East Broadway Avenue, Meridian, Idaho 1. Roll -call Attendance: X David Zaremba X Joe Borton X Charlie Rountree X Keith Bird X Genesis Milam X Luke Cavener X Mayor Tammy de Weerd 2. Adoption of the Agenda Adopted 3. Approval of a Budget Amendment for a Dog Park in the Not -to -Exceed Amount $226,408.00 Approved 4. Approval of a Budget Amendment for Storey Park Improvements for the Not -to -Exceed Amount of $1,344,860.00 Approved 5. City of Meridian FY2015 Budget Meeting Presentation Adjourned at 12:58 p.m. Meridian City Council Special Meeting Agenda —Wednesday, July 9, 2014 Page 1 of 2 All materials presented at public meetings shall become property of the City of Meridian. Anyone desiring accommodation for disabilities related to documents and/or hearing, please contact the City Clerk's Office at 888-4433 at least 48 hours prior to the public meeting. City of Meridian Proposed Presentation Schedule Schedule is subject to change FY2015 Budget July 9, 2014 Wednesday 10:00 am to 5:00 pm Start End Minutes 10:00 - 10:10 0:10 10:10 - 12:00 1:50 12:00 - 1:00 1:00 1:00 - 3:00 2:00 3:00 - 5:00 2:00 Department Council assemble, review any additional materials Enterprise Fund Lunch (Ordered In) Enterprise Fund Council Budget Decisions and Discussion Meridian City Council Special Meeting Agenda — Wednesday, July 9, 2014 Page 2 of 2 All materials presented at public meetings shall become property of the City of Meridian. Anyone desiring accommodation for disabilities related to documents and/or hearing, please contact the City Clerk's Office at 888-4433 at least 48 hours prior to the public meeting. Meridian City Council Budget Meeting July 9, 2014 A special meeting of the Meridian City Council was called to order at 8:00 a.m., Wednesday, July 9, 2014, by Mayor Tammy de Weerd. Members Present: Mayor Tammy de Weerd, David Zaremba, Keith Bird, Joe Borton, Charlie Rountree, Genesis Milam and Luke Cavener. Others Present: Bill Nary, Jaycee Holman, Stacey Kilchenmann, Todd Lavoie, Bruce Chatterton, Jeff Lavey, Mark Niemeyer, Steve Siddoway, and Patrick Dilley. Item 1: Roll -call Attendance: Roll call. X David Zaremba X Joe Borton X Charlie Rountree X Keith Bird X Genesis Milam _XLucas Cavener X Mayor Tammy de Weerd_ De Weerd: I will go ahead and get us started for our special meeting agenda, our budget workshop. I appreciate all of those in attendance and did I waste enough time so we can have roll call attendance? Madam Clerk. Item No. 2: Adoption of the Agenda. De Weerd: So, welcome. Item No. 2 is adoption of the agenda. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: I move we adopt the agenda as published. Milam: Second. De Weerd: I have a motion and a second to adopt the agenda as published. All those in favor say aye. All ayes. Motion carried. MOTION CARRIED: ALL AYES. Item 3: City of Meridian FY2015 Budget Meeting Presentation De Weerd: Item 3 is a budget amendment in front of you. Council, I will look for your direction. , Cavener: Madam Mayor? De Weerd: Mr. Cavener. Meridian City Council Budget Workshop July 9, 2014 Page 2 of 41 Cavener: I move that we approve the budget amendment for the dog park for a not to exceed amount of 226,408 dollars. Milam: Second. De Weerd: I have a motion and a second to approve Item 3. Any discussion from Council? Rountree: Madam Mayor? De Weerd: Mr. Rountree. Rountree: I think my position on this is pretty well known, but just for the record I support this on one condition, that I don't hear the name again. Bird: That's the only reason I'm supporting it. De Weerd: The Rountree Bark Park? Okay. I won't say it after this. Okay. Any further discussion? Mr. Zaremba. Zaremba: Madam Mayor. It's no secret that I support this, but I would like to add that I hope this is an impetus to the dog park committee or the group that is organized to get together and do some fundraising. I mean they could create amenities for the dogs on the park that are within walking distance of Zamzow's, so they ought to talk about some advertising assistance and stuff. So, I do think there is more that can be done by the dog users. I don't happen to have one, but I'm thrilled this is happening. But I do hope that this is a first step for the dog park users to get some more donations and some more activity going. De Weerd: And, Steve, maybe you could take that to the Parks Commission in terms of asking them to revise the subcommittee that was looking at the dog park and seeing if they can start looking at concepts of an annual naming of shelters and those kind of fundraising activities. Siddoway: Yes. And I have already been in contact with Nampa's parks director for some direction of what they are doing as well. So, thank you. De Weerd: Okay. Perfect. Thank you. Any further discussion? Okay. Madam Clerk, will you call roll. Roll Call: Bird, yea; Rountree, yea; Zaremba, yea; Borton, yea; Milam, yea; Cavener, yea. De Weerd: Wow. All ayes. Meridian City Council Budget Workshop July 9, 2014 Page 3 of 41 MOTION CARRIED: ALL AYES. De Weerd: Item 4. Cavener: Madam Mayor? De Weerd: Mr. Cavener. Cavener: I move that we approve the budget amendment for Storey Park improvements for the not to exceed amount of 1,344,860 dollars. Zaremba: Second. De Weerd: I have a motion and a second to approve Item 4. Any discussion from Council? Madam Clerk. Roll Call: Bird, yea; Rountree, yea; Zaremba, yea; Borton, yea; Milam, yea; Cavener, yea. De Weerd: All ayes. Motion carried. MOTION CARRIED: ALL AYES. De Weerd: Thank you. Item 5 is our budget workshop continues. I will ask Finance if they have any comments at this point. Kilchenmann: We are good at this point, so we will just go ahead and let Public Works begin. De Weerd: Okay. Well, then, I will turn this over to our Public Works Director Tom Barry. I just will note, I have a 2:00 o'clock soccer game that we hope we are done then. Barry: I think you may want to see if you can get that rescheduled, Madam Mayor. We could be here a while. De Weerd: It will show up in your evaluation. Barry: Oh, great. Just one more thing. All right. Good morning, Mayor and Council Members. It's our pleasure -- my pleasure, I should say, to present to you the Fiscal Year '15 proposed Public Works budget. But before we do I wanted to run you through a couple of slides that showcase, essentially, how we put our budget together, the approach that we took and, essentially, put in context what the requests are we have before you. De Weerd: And, Tom, just know next year you go first. Meridian City Council Budget Workshop July 9, 2014 Page 4 of 41 Barry: Fantastic. De Weerd: We will do Enterprise Fund before General Fund. Barry: That will put you in a better mood. De Weerd: Giving you a heads up. Barry: All right. Okay. Here is the overview of what we have for you today. Essentially, we are going to talk very briefly about the Enterprise Fund and some of the peculiarities and basics about the fund. Briefly go through a couple of highlights for departmental accomplishments and challenges and speak also briefly about a budget process to give you some idea as to what kind of thought and what kind of approach was taken in the development of our budget and, then, finally we will propose the budget enhancements and be open for questions about the base budget and, then, be open for questions and discussion at the end. I don't think this will take the full time that we have allotted for today. Most of our amendments — or, excuse me, I should say enhancements are pretty straightforward, but, nonetheless, it's good to have that time. There are some differences and this is mostly for the new council members and also for the viewing public. There is some major differences between the General Fund and the Enterprise Fund. The General Fund, principally, the funding sources there are taxes, whereas the funding sources primarily for the Enterprise Fund are, essentially, civil services. So, water and sewer sales and also connection fees for water and sewer infrastructure. Those are the dominant funding collection points. Those funds, essentially, in the Enterprise Fund are restricted to the use of the assets and the infrastructure by which that was funded through the collection of rates and connection charges. So, we can't share between General Fund and Enterprises Fund. We have to keep the funds in the Enterprise Fund intact and they are only to be spent on Enterprise Fund activities. It is possible, however, to pay General Fund monies and subsidize Enterprise Fund activities. We have not done that, nor are we proposing to do that. But those are just some nuances between the funds. Very quickly a couple of accomplishments that we want to run you through. I'm going to use the modified balance scorecard, which is what we have used for a couple of years now to highlight the major areas of function for the department and the first one being financial and these are highlights. You know, we will see you in October and go through a much more thorough discussion of the accomplishments and challenges we have in our strategic focus presentation to you as I say in October. But, essentially, we have done a lot of good things in the last fiscal year up to this point in time and one of the things, of course, we did on the financial side was to do a really robust rate model update. We have been able now to get the rate model to project ten years and we have also been able to incorporate some depreciation calculations into it. But as you will find later in our presentation, the rate model that we used, which is a glorified Excel spreadsheet, is really becoming difficult to manage with all Meridian City Council Budget Workshop July 9, 2014 Page 5 of 41 these additional inputs and so you will see a little bit later on another slide that while the rate model may work for us and it does a good job for us at this point in time, is also a challenge in getting it to do more going forward. Plus putting together our fiscal year 2015 budget, that's a huge accomplishment with about a 30 million dollar budget and there is a lot that goes into it. Operationally asset management, the asset management program has really blossomed. We are able to bring asset management to the water division and add an additional 17,000 assets over the last 13 months, which we are very, very proud of. In water quality we have done many pilots operationally to evaluate the efficacy of iron and manganese improvements to the drinking water wells. We are pleased with that. And that has led to some of the enhancements that you will see, which is the request for installation of those water quality treatment methods or mechanisms into a couple of the wells around the city. Of course you all are familiar with the Meridian Heights Water and Sewer District and the enormous work and I think success that we have been able to achieve in working with a number of different partners on that. The wastewater treatment plant has been undergoing improvements since, essentially, 1977 when it was located in its current location. We continue to make improvements. We could go through a long list of those improvements, but I will spare you the pain of doing that. Strategically we have been continuing to move to more preemptive and proactive approach, both legislatively, dealing with irrigation issues. You know, we have a master agreement now, which has really alleviated years worth of problems that we have had and we have also improved our relationship with the Nampa - Meridian Irrigation District and Settlers Irrigation Districts as well. Project managementwise, we have also been improving there. We have a little bit more ways to go. But the process schedules and budgets have been improved. I know that some of the staff are still frustrated by some of the processes we have and how those processes, essentially, work into or against some of the technology we use to track and manage projects and those are some of the challenges that we will be addressing over the next short term as well. But yet a lot of good work is happening in that area. On a customer standpoint we have done a lot of outreach to automotive, printers, dental offices and the like with regard to a pollution prevention program. We have done outreach to the general community through a couple of different animations. You have seen the wastewater animation. The water one and Republic Services partnership that we did for solid waste are in production right now and should be available hopefully within the next month or so. And the water quality management, again, this goes back to iron and manganese treatment as it relates to customers and also the utilization and prenotification and the quick response that we have to brown water calls that we get. So, some of the operational changes that we have made have allowed for us to reduce brown water calls over the years and in particular when we know that we have a high demand, say, for example, of Roaring Springs, we have a relationship with — by which they will give us a ring and tell us when they want to fill up their pools for the start of the summer and we will shutdown certain wells that might have a little bit more iron and manganese in it, reroute the water that comes from better water quality sources and fill their pools Meridian City Council Budget Workshop July 9, 2014 Page 6 of 41 accordingly. So, those types of things are very important to us and help keep customers happy. On the employee front our -- we did an employee satisfaction survey last March or so and the results of that have led to a number of different improvements in the department, which have been good. One of the areas that was important to our staff with relationship to the compensation program, which was important to ironically staff across the city and, of course, to the City Council and the Mayor and so we have worked diligently with the direct — or I have worked diligently with some of the directors of the other departments and the Finance director, the Mayor, and also our Human Resources director are pleased with the compensation program that we were able to develop late last year and institute. We have done a skills assessment. That is about a 40 to 50 point check. The skills and capabilities of our staff. That's been deployed departmentwide. That skills assessment has now allowed as to tailor the types of training that staff should be receiving in order to remain confident in their work. Instead of just broad-based training that kind of covers everybody as a large net, we have been able now to, essentially, tailor the types of training that we would like staff to achieve and make a part of their work plans, so that we can, as a collective whole, more strategically move the competency of our staff in the direction that is in alignment with the vision for the department. Safety training has been one area that we have also put quite a bit of resources to at this point in time. About 98 percent of the entire department has been OSHA trained and certified in a ten hour OSHA safety course. That's in addition to all the other safety courses that are offered in the operational side of our department, like confined space, you know, fiber training and so on and so forth. And, then, we have developed an onboard program and plan that we now have begun to deploy with new positions. This plan is like a 30-60-90 day plan that sets up our staff when they joined the city to be as successful as possible. It points them in the direction of relationships that they should be developing, in procedures, processes and policies that they should be researching and gives them a leg up right from the very beginning on how to become successful as soon as they can in their position and that's proving to be very valuable as well. We have a number of challenges. Of course, the utility rate model I mentioned before is a struggle for us, because it has been difficult and cumbersome, time consuming, and laborious to manage, just because of the number of the inputs that we have and length of time it takes us to change one and redo all of the different data. It's not dynamic from that standpoint that we would like to see. Also NPDES implementation, we have talked to you a couple times about that. Implementing the improvements that are being mandated from the federal government are a challenge for us. The utility billing software program, selection, and implementation is also a challenge for us. We are working closely with the Finance Department staff and Water Division and Public Works engineering, so that we have as much functionality as we can on that particular program and that it satisfies as many different user bases as we can. And, then, future funding of the capital, infrastructure, and replacements. This is depreciation financing. This is going to remain a challenge for us, particularly as we embrace the NPDES challenges and have to postpone some of the long-term planning and strategy Meridian City Council Budget Workshop July 9, 2014 Page 7 of 41 that we think is important for positioning our department for the bubble that's going to come with regard to growth in the form of infrastructure. The good news there is that we have 20 to 30 years before that bubble really hits us. So, we do have some time there. But that is a challenge that we would like to begin to address in the near future. Operationally, managing growth is a challenge. We are, you know, the tenth fastest growing community in the nation, so I read in one of the national papers recently. Our NPDES, again, and operations, both financially, but in operations is going to be a challenge. SCADA system improvements. This is supervisory control and data acquisition. These are the telemetry systems that we utilize to manage all of the infrastructure, essentially, that we have in Public Works. That is enormous. You will hear a lot more about that today. Asset management, while successful to date, is still in its infancy. There are a lot of -- there is still a lot of work to be done on the asset management side, but there has been a lot of very valuable information and outcomes that have been associated with the asset management program and you will hear a little bit more about that, too. Inventory management is still in its infancy stage, so we have got quite a bit of work to do there. Formalize a program and make that program -- prove that program up, so that we can maximize the benefits of an inventory management and maintenance program. On the customer satisfactory side, while we are making progress on iron and manganese control, it's still an issue for us and so we still continue to address that on a monthly basis. Water treatment plant -- wastewater -- excuse me. Wastewater treatment plant odor control, still an issue. It's becoming a bigger issue. You may recall -- or might remember that the treatment plant was located in the mid 70s out in the middle of nowhere and since then we have had quite a bit of development that's occurred. Most recently the Isola Creek -- I think what we are calling now Ballano Creek or Ballano Subdivision, which is immediately downwind of the wastewater treatment plant. We anticipated probably getting more calls as people move in and realize after they have purchased their homes where they have moved. Strategically, we -- as we do every year, we know there will be challenges at the legislative front. Particularly with regard to water issues. Our strategic plan update has been postponed and our departmental accreditation activities have also been postponed as we had 50 vacancy rate in our executive team and so we just couldn't move that work forward until just very recently when we filled those two positions. So, we are excited, would like to get through this budget process and, then, began that work again. And, then, on the employee front, you know, staffing levels, you know, making sure that we are guiding growth and meeting that growth with appropriate staffing levels, not just growing staff too quickly, not growing staff too slowly. That's always a challenge. And, then, of course, recruitment and retention are challenges for us as well in the fact that we have a very, very, very difficult time finding high quality candidates for many of our positions. So, workforce development has become increasingly important for us and I'm sad to say that we have not made as much progress as I would personally like to see in that area along the lines of secession planning and workforce development, but we have made progress. So, we have listed that as a continued challenge. Meridian City Council Budget Workshop July 9, 2014 Page 8 of 41 De Weerd: Well -- and, fortunately, you have hired only the best, so -- Barry: We are fairly picky about that. Thank you, Mayor. We do hire the best. De Weerd: Right? Barry: Thank you. I wanted to touch now briefly on the budget process overview for us. You know, most of you know this is a long, painful process for most departments. We are not excluded from that. The Finance Department did a really nice job in laying out all the rules and the calendar dates and all of those types of things. So, this just enumerates very briefly some of the activities that have gone on. But I think what's really most important here is to remind the City Council that there is an awful lot of thought, discussion, deliberation, dialogue that occurs during this budget process and I think you know and appreciate that, but we don't come unprepared or alternatively asking for things that have not been thoroughly vetted through a number of different processes and channels. One of the things our budget incorporates is this notion of working the plan. We have a dozen or more plans that guide what we do in the Public Works Department. I won't list all those plans out, but some of the general categories are listed here. We utilize those plans to make sure that the direction this department is going is the direction that the community and the City Council want it to go and so we are in alignment -- this budget is in alignment with these plans and is, essentially -- this budget, essentially, deploys the continuation of those plans. So, I just wanted to make sure that we were clear that those particular plans which are used don't just sit on the shelf, they are actually incorporated into the budget request and that those budget requests are what, in part, you will see today. So, we have an approach that we take in Public Works when we put our budget together and it, essentially, is numerated here. These are in no particular priority, but they are important for us in the consideration of the budget development process. So, our budget should incorporate all of these aspects is what we strongly feel and it does. We should meet current regulatory and safety requirements, preserve product, service, and quality area and delivery levels, adequately protect and maintain the infrastructure that we currently have, follow our plan by instituting measured expansion of assets and infrastructure, continue to use the just -in -time capital financing approach, utilize our technological resources where we can to maximize efficiencies, sufficient funds and deploy workforce training strategies, which allow us to invest in the staff, which are the most important assets that we have in our department. Incorporate performance based budgeting principles. This is not necessarily performance based budgeting from the technical standpoint, but many of the principles of performance based budget are excluded in the development of this. Maximize our operational efficiencies and focus on cost avoidance strategies and ask for only for what is needed. Maybe I should pause there for just a second to say that this budget has been heavily cut. You won't see eight enhancements totaling 1.8 million dollars, because the executive team has already vetted them out. Those Meridian City Council Budget Workshop July 9, 2014 Page 9 of 41 are needs that we have as a department, but they are not the highest needs in consideration of all the other needs that this department has. So, about 16 percent of the requests were denied right through the vetting process. So, I want to make that clear. And, of course, we want to empower our budget stewards, because it is them, our division managers, that are responsible for executing and implementing this budget and for being responsible and reasonable in its development. So, our strategy is consistent with the rate model. We have talked with you about rates. You know where we stand on rates. This model -- or, excuse me, this budget is consistent with the rate model that we have developed. It also continues with the pay-as-you-go strategy. It also accommodates impending regulatory requirements. It includes an investment management of our budget processes to ensure that we are maximizing efficiencies, reducing costs wherever we can as well and it has some consideration for depreciation eligible assets. You will see that we are still continuing to replace and repair existing infrastructure. We don't have a ton of that, because a lot of that infrastructure that we are replacing or repairing is, you know, 50 or more years old. And, then, finally, we are still continuing to focus on continuous process improvements. With vetting these budgets get many, many eyes. Obviously, the Mayor and Council have been instrumental. Finance Department. Our Public Works executive team and our strategic leadership team and many key staff have put a lot of time and effort into the development of this budget. So, I wanted to thank and recognize each of them. I wont read the list, but you see it before you here. So, let's talk a little bit about a proposed budget and we will do a comparison here of last year's adopted and this year's proposed budget, because there are a couple differences. First of all, the budget that was requested and adopt the last year was about 30 million dollars. This year our budget is about 27.8 million. These numbers don't include inter -fund transfers and a couple other incidentals, by the way. Essentially, you will see a growth in personnel operations and maintenance and you -- you will get to hear that is occurring and what the requests are today. Many of which are regulatory driven, as we haven't been talking to you about for some time. The number of enhancements is increasing, but their dollar value is decreasing from last year to this year. You will see that in the next slide here. And replacements are holding about the same for the most part. So, here is the enhancements I just spoke about and this is a number of enhancements back to 2010, along with their dollar value. So, in the fiscal year'15 we are proposing about 43 enhancements. So, the largest number of enhancements over the last period, but a reduction in the overall value of those enhancements, which is good news. So, a lot more to do, unfortunately, not a whole lot, at least in this particular budget, with regard to -- I mean there are some pricey enhancement, but not as pricey collectively as we were dealing with last year. To give you a sense of where we are in the Enterprise Fund from a revenue standpoint, the bars represent, essentially, total revenue. The blue line represents at the top there utility sales. This is a sale of water and sewer services and, then, the orange or -- orangish pinkish line there at the bottom represented assessments. We did project FY -14. We were under in our projection at the start of the year. We have recalculated that based on Meridian City Council Budget Workshop July 9, 2014 Page 10 of 41 year to date and also projection to the next two and a half months and you can see that we are trending pretty nicely here with regard to the Enterprise Fund revenue. So, with that we will get into our fiscal year '15 enhancements. You will hear from a number of staff today. As I say we are empowering our budget stewards, so I will be asking them to make presentations in their particular areas. First off you're going to hear from our brand new business operations manager Mr. Mike Pepin. I think you have met him off and on, but I will have him come up and introduced himself and, then, he will run through the first couple enhancements and, then, we will pass it off to the next staff. De Weerd: Thank you, Tom. Welcome, Mike. Pepin: Well, good morning, Madam Mayor, Council Members. I appreciate your time and really excited to be here today. Quite frankly, because business operations division -- supports all the divisions across Public Works, so two of the enhancements that we are going to be posing and presenting today -- they are not just about the business operations division, because we support all of the divisions across Public Works, so they will have an impact across the whole department. So, I wanted to provide that today to give you a little bit about where we are coming from with these enhancements. The two enhancements that I will be referring to today are an addition of an asset management analyst, which is, obviously, a resource in personnel. The second one, which Mr. Barry commented on briefly, was a rate model upgrade. The purpose of the asset management analyst will enable us to optimize and manage the utility assets and meet the increasing demands and requirements associated with the utility assets that we currently have. A few duties that this position will be responsible for. They will be able to proactively manage asset life cycles, provide customer service and support, perform QAQC functions, identify additional critical assets -- and I will get to those additional critical assets shortly. Conduct work order management. Maintain preventive maintenance schedules, which is very important for both of our utilities. Provide repair and replacement savings strategies and conduct end user training to our sole database, which runs our asset management program and it's called Hansen. So, if I refer to that again, that's the asset database that takes care of all of our assets and provides preventive maintenance schedules and things along those lines. A little bit of history really quick. The department was compelled to actively manage our assets nearly seven years ago and since we have found a great success, especially through wastewater and, then, have since moved into water. We have 23,000 assets identified within the wastewater division and anticipate adding nearly 30,000 more. The success from wastewater, as I mentioned, has moved into water and as Mr. Barry has commented, we have identified 17,000 assets within water and anticipate adding potentially 64,000 more. Those aren't just assets that you can potentially touch, but they are also services that go along with maintaining scheduled maintenance of those assets. With our estimated valuation of both utilities at nearly 600 million dollars -- and that's a large number, but that's if the utilities went away tomorrow and we had to build them from the Meridian City Council Budget Workshop July 9, 2014 Page 11 of 41 ground up. So, we take that approach when we are talking about asset management and evaluation of our utilities. So, adding another resource in terms of the personnel to this program will reduce vulnerabilities of the program and maintain a level of support vital to the utilities and their longevity. The impact that this position will have on the program will be felt immediately. Having a backup to the administrator of the Hansen database that I mentioned earlier is really important to us. Currently we only have one individual serving as the administrator of that program and when she's not available the heart and soul of asset management just runs, it doesn't improve. So, we see ourselves a little bit vulnerable in that aspect. We want to conduct more QAQC what we have in the system. As you all know, the better the data the better the work. We are not able to provide those functions right now, because we don't have another resource to QC all of those assets that are in our system. We want to improve customer service and support. As I mentioned, we are providing support for two divisions now, but we have one individual splitting her time. We want to provide concurrent support at both divisions simultaneously and overlapping, so that we don't miss anything. We want to increase productivity, which improves efficiency and reduces redundancy. Perform work order management. We average nearly 1,000 work orders a month across both utilities and we feel by adding this position it will enable us to increase the support to those work orders. Provide end user training. Our database Hansen is currently going through an upgrade and, as I mentioned previously, we have one individual providing that training and, by the way, she's been out for the last couple of days with the flu and we have some training scheduled, so that came to a halt. And, finally, this position will assist in identifying the conditions of assets, which, in turn, allows for efficient cost decisions to be made and, as you know, that saves the time and money. So, as you have heard, this position is critical to our asset management program. We would appreciate your support and I would be happy to answer any questions you may have on this enhancement right now. De Weerd: Council, any questions? Bird: I have none. Borton: Madam Mayor? De Weerd: Mr. Borton. Borton: Just one. Mike, does the work order -- 1,000 work orders a month, do those originate from this position and the systems that are being maintained by it? Pepin: Madam Mayor, Council Member Borton, the answer is yes. They are generated from that system. Take a piece of equipment and you input all the data that goes along with that piece of equipment and it generates the scheduled work order. Meridian City Council Budget Workshop July 9, 2014 Page 12 of 41 Borton: The current position is doing -- Pepin: The current position is doing all of that. We do have some support in terms of a data entry that -- we are utilizing another individual, who is an administrative assistant helping with data entry, but the back end of that entire database falls on one individual. Rountree: Madam Mayor? De Weerd: Mr. Rountree. Rountree: First of all, welcome to your first budget workshop Pepin: Thank you. Rountree: We're in good shape. Just to get the information out, I'm going to ask you to define asset as you have described it here by using examples, because I know it's more than just things and pieces, parts, as you alluded to, but what -- what is -- give us an array of what those assets might consist of. Pepin: Well, if you take the Water Division specifically, it goes from the well to the house, meter cans, the pipes themselves, the pumps -- booster pumps, the wells themselves and when you talk about a well you're not just talking about one piece of equipment that goes down however many feet the well is, you're talking about every single component that gets the well from above the ground where the motor is, all the way down to where the water is. All those items in there have a shelf life or what we like to refer to as a life cycle and asset management is really about managing life cycles of equipment and their schedules, so that we are proactive rather than reactive on when things need to be replaced, serviced, maintained and things along those lines. So, that's one example. Another example from the wastewater perspective would be anything that has to do with the plant that needs to be replaced or maintained, you know, there is -- and, you know, that is very many individual processes out at the wastewater treatment plant. We have all of those within our asset management database to provide all those records and maintenance for our maintainers and operators so they can perform those things to keep our assets running healthy and properly. I don't know if that answers your question. Rountree: That's what I was after, so people can get a sense of what -- what all is entailed. Pepin: Absolutely. Thank you for that question. De Weerd: Any other questions at this point? Meridian City Council Budget Workshop July 9, 2014 Page 13 of 41 Bird: I have none. Pepin: The other enhancement that the business operations position is seeking and proposing -- and Mr. Barry, as I mentioned previously, mentioned it already, was an upgrade to our rate model. In 2008 the department established an internal rate model tool that enabled us to assist and establish the utility rates. Despite a series of upgrades and enhanced functionality, we feel our current tool does not align with the demands and requirements of our growing utilities. It's not robust enough to fully assist with planning and forecasting financial requirements. It's dynamic, by which I mean it doesn't account for fluctuations, and changes in business. As you have heard, it's a bear to manage. It's cumbersome and time consuming. It's essentially an Excel database program on steroids that we have a hard time managing. The purpose that we are looking for -- we want a tool that will project rather than predict. Contain strategic content. Establish a baseline for long-term decisions and over -manipulation of assumptions, build the scenarios for consideration, and to provide annual models to allow for fund gap analysis comparisons and even account for seasonality. The impact, much of the cost associated with what we are asking for in this enhancement will go towards bringing a consultant on board. We are going to charge that consultant with conducting a needs assessment, evaluating user requirements, performing gap analysis on what we have now and what we need in the future to help us. Gather model tool options to purchase. Integrate our data. Test the tool. Train users. And, then, obviously, implement to use. Accuracy of utility rate -- excuse me -- utility rates is vitally important and a new rate model tool will enable reliable forecasting and stronger stability of our rates. And, again, I appreciate your support on this and will take any questions that you may have. De Weerd: Council, any questions? Bird: I have none. Pepin: Well, Madam Mayor, Council Members, I appreciate your time and kindness today and I would like to welcome Mr. Dale Bolthouse. He is our deputy director of operations. De Weerd: Also known as Bruce. Only on the south side of 1-84, though. And we will field questions, Bruce, at the end of your items, unless Council might have some -- Bolthouse: That would be fine. Thank you, Madam Mayor and Council Members. I, too, appreciate the opportunity to address you this morning. You are looking at my single and only slide today. De Weerd: There you go. Meridian City Council Budget Workshop July 9, 2014 Page 14 of 41 Bolthouse: It might keep us on the schedule for that 2:00 o'clock soccer. I am very pleased to join you here as a representative of -- as your deputy director of utility operations over water and wastewater divisions and although I have a relatively short tenure here with the city and the government operations, I do bring with me 25 plus years of overall operations experience and I hope that in time I can continue to inject that into the organization. One thing, though, that is common, not only in our processes here, but through all of the other budget presentations that I have been through is that they are time consuming, they are challenging, and so we are right there with the rest of the world in terms of our process here at the city. But that's not all bad. It yields the kinds of results that move -- move us forward in a manner that we would like it to. I have been very pleased to have the opportunity in my first few months to take the time to observe what makes up some of the strong culture within the operations group and that includes a variety of items. It is not limited to, but, you know, a real dedication to the development of the professional and well-trained staff. It is very favorable to other top notch organizations that I have been associated with and the city has done a very good job in investing in its people. As many of you have seen as you have had the opportunity to tour the facilities through -- as recently as the Go With The Flow tour, we can all take just great pride in the facilities and how they have been maintained and the infrastructure. That's very, very important. I think it reflects the financial and responsible stewardship that you have given us in managing those -- those facilities. Very excited about the appetite for continuous improvement. That really is one of the key factors that enticed me to the city was that drive to always look for ways of doing things better, not accepting the status quo. That creates an exciting environment and offers us the opportunities to look for more efficient operations, more effective operations. And one that's kind of an underlying theme of today is we talk about, you know, the concept of SCADA and asset management and things is it does have a very strong desire to improve our manufacturing and management information systems and the ability to communicate that to the folks who need it. As this department and our utilities grow, it's becoming increasingly difficult for us to keep our arms around that operation and that's only going to become more challenging if we don't invest in those tools and automation that allow us to -- to do that. So, you know, all of these base characteristics that I have observed I believe have served the city well and will continue to be a part of the foundation of our efforts going forward. As I step back just -- and look at the overall budgeting process, one of the things that I look for is making sure that we are, indeed, having a balanced approach to investing in many of the critical operational functions in operations. Things that have already been touched on in some of the previous comments, but include, you know, making sure that we are improving our customer service and consumer confidence. Incorporating investment in the personnel and the processes of which we managed. Meeting those ever increasing and always important growth objectives and improving our reliability of the services that we are providing. Obviously, meeting the intensifying requirements brought on by regulatory compliance and although we are seeing and hearing a lot about the wastewater side, some brief exposure I'm getting to the water world suggests Meridian City Council Budget Workshop July 9, 2014 Page 15 of 41 that that is on the horizon as well for us. And as mentioned earlier, providing investment for operating efficiencies and the effectiveness of what we are doing and implementing the command and control requirements, so that we have better information. So, I believe that the budget and the enhancements presented today by the operations team represent a good balance against those dimensions and will continue to build, you know, upon the past efforts and allow us to continue to strive towards our Public Works mission. So, with that at this time I would like to introduce Tracy Crane and Clint Dolsby. They are going to go ahead and walk us through today's budget enhancements for the wastewater division. Thank you for you time. De Weerd: Thank you, Dale. Crane: If I can figure out how to use this. Madam Mayor, Members of the Council, good morning. It's great to be with you. We will get the -- right off the top we are the expensive division I guess. I get to the pleasure of presenting the majority of our -- of our -- De Weerd: Expensive and cause us a lot of concerns. Crane: Yes. I'm sorry to hear that. We, essentially, have 20 enhancements totaling about ten million dollars and we will go through each one of them in a little bit more detail and stand for questions at the end. Our first enhancement is the NPDES elimination system compliance plans. So, as you're aware we have received a pre -draft copy of our new permit and compliance activities are featured prominently throughout our enhancement request this year. This enhancement funds some studies that will look at our treatment capability and help develop a longer-term compliance plan that will both help us figure out how to manage growth and choose treatment technologies. These early design studies are purposely put in the front of the capital upgrades, so that they can feed the information into and, hopefully, help us make the most cost-effective decisions that we can. The plans and studies -- the information that comes out of this will be a critical to help us balance the needs to increase capacity and meet the new strict nutrient limits. Also serves in coordination with that and the rate model are the -- this enhancement is seeking funding for a financial evaluation plan. This would be, essentially, an in-depth look at the financial evaluation of the wastewater utility and the capital improvement plan. Now, with the initial compliance estimates at over 150 million dollar range, this enhancement would proceed in conjunction with that to help make sure that accurate funding is in place and also that the funding comes from the right source. For example, that growth pays for growth. Our next enhancement is a first year of a two year Just- in -time finance project that would include the design and construction of side stream nitrogen removal process and a centrate equalization tank. The dewatering process and centrate that comes out of it, essentially, accounts for about 25 percent of the total nitrogen load to our facility. It's a very concentrated, relatively small stream and it's most cost effective to treat it in the small stream. Meridian City Council Budget Workshop July 9, 2014 Page 16 of 41 If we don't treat it in side stream, we have to treat it in the main part of the plant, which means that our secondary systems, our aeration basins and our secondary clarifiers get 25 percent larger, so it's more expensive the longer term to treat this nitrogen load in the main part of the plant. So, the next -- the next enhancements are for laboratory positions. Continuing with our compliance theme here. Our new NPDES permit that we have seen -- roughly the testing that's in there will quadruple. Just to give you an example, it contains 121 limits, constituents and plans. If you want to put that in perspective, the permit we are running under today contains 32 constituents, limits, and plans. Surface water sampling out at the river will increase from four sites weekly from zero right now, which we don't have to do. These new limits require highly technical specialized equipment and methods to perform. We have consulted with both EPA and DEQ and our current understanding is that monitoring for these new parameters will have numerical limits, will be required to begin as soon as the permit becomes finalized, which right now, if everything keeps going down the path, could be as early as November. I should also mention that when we add technology at the facility process testing increases, so operations can get the data to make sure that the process is working. Just to give you an example, we recently this last month started up our fermentation product -- project, excuse me, and the laboratory staff was asked to perform 26 additional tests each week and the test provides the necessary data to operations, so that folks can make sure that the process is operating efficiently. Also the addition of these positions will allow our staff to be -- our lab to be staffed seven days a week up from the current five days a week and allow that information to flow through the weekends as well. The next enhancements we will address are the operator positions. We are requesting two full-time operator positions, largely due to the combination of utility growth and increasing regulatory oversight. As you can see from the pictures our utilities just continue to grow. Since 2006 we have experienced 22 percent growth in sewer pumps. We have completed in 60 capital projects with a cost in excess of 55 million dollars. In that time the plant has increased in technology, complexity, and size. We have increased the treatment capacity. We have done a solid stream expansion, a liquid stream expansion. Added biological nutrient removal. A Class A reclaimed water program, as well as fermentation, just to name a few of the projects. And to give you an example, the fermentation process alone added an additional 135 assets and 102 additional valves to our facility. Also I'd like to say we rock around the clock. Our facility runs 24/7/365. It has to run all the time. It's currently staffed 18 hours a day, seven days a week, by a staff of just six operators and two leads. Construction also presents a challenge for our operations team. As you might imagine, the plant must stay running all the time and so we have to -- as we construct and build new things operations has to be consulted, we have to work closely with engineering and contractors to make sure that the plan can stay running all the time. We are pretty proud of ourselves over the last eight or ten years of keeping up with the 60 million -- or the 55 million dollars in a capital growth. With the production planned to double, we are going to need some more operational of oversight of those construction activities. The next enhancement is divided into Meridian City Council Budget Workshop July 9, 2014 Page 17 of 41 two parts. The first part is requesting a -- two additional collection staff and a CCTV -- a closed circuit television inspection camera for our sewer. The CCN information is used to establish conditions assessment of sewer line and, essentially, serves as the backbone of the entire O&M program for the collection system. Essentially, how it works is you do a five year inspection schedule, you get a baseline, so for the first five years we are inspecting and creating a baseline of our entire collection system and, then, the next five year cycle you compare the change in asset to the baseline and you can either elongate O&M schedules or shorten them based on what you see. If you look at the graph there, our CCN program, our entire in-house collection program has been in- house for -- next year it will be its fifth year of operation and we are only about 65 to 70 percent of the way done with the initial baseline assessment. So, two things that primarily slowed that down. One is service connections -- 29,000 plus service connections, each one we are responsible to maintain if it falls in the right of way of the road. So, what our CCTV folks have to do is as the camera goes down the line it has to stop at every single service connection and note it's location from the manhole and it will look and it will say it's 27 feet, you know, at 3:00 o'clock, here is a service connection, and also grades the pipe using a standard PACP pipe assessment condition assessment rating as it goes through it. The second thing is growth has slowed us down. In the last five years 37 and a half miles of new sewer line -- or eight and a half months worth of additional work at our current rate have been added. Estimates put the value of our collection system infrastructure well over a hundred million dollars, most of which is located underground. In addition to these resources it will allow us to stay on target with the collections program objectives and keep pace with utility growth. The second part of this enhancement is to fund additional camera equipment and an easement cleaner. Our current camera equipment has been in continuous operation for over four years, as you might imagine, in a very harsh environment. Updating the camera equipment was -- provides advanced -- new and advanced imagery and also improved -- excuse me -- improved reliability. The second part of the enhancement is to purchase a sewer easement cleaning machine that you see on the picture. It has a little red circle. I say it looks like a bomb robot or something, but you see from the pictures of our stock cleaner truck there -- De Weerd: It might be. Crane: It could be -- and maybe it's dual purpose. There are many sewer lines located in easements and along creeks and alleys that our big truck just cannot get into. If you see -- as you can see from some of the pictures. We have 16 miles of sewer lines that are easements that currently right now are a challenge or impossible for us to access with our current equipment. So, the purchase of this easement cleaner will give us the capability to go in there and clean those easements that are located. Now, this won't solve all of our issues surrounding easements, but it will improve our emergency response and our ability to maintain those compliance. The next enhancement is the second of a three year just -in -time project to expand the ultraviolet disinfection system. Currently right Meridian City Council Budget Workshop July 9, 2014 Page 18 of 41 now we have -- our UV system is in two channels, each channel has seven and a half million gallons a day of disinfection capacity. However, if we have to do maintenance on a channel you close that channel off, you lose half of your capacity. This is a problem. Our channels are normally drained and cleaned and inspected on at least an annual basis. This is a problem for us and we can only do this in the middle of the night right now, because you cannot get a -- when we close that channel off and we only have seven and a half MGD of disinfectant capacity, our peak flows so far for 2014 is 10.16. So, essentially, also are UV system represents one of our lowest unit processes and that's how they rate the plan based on unit processes. So, no matter what we do in the future with treatment technology, disinfection is always required and it will need to be expanding anyway. So, this project here will address the UV channel maintenance issue and expand the system for future growth. And with that I will turn to Mr. Allison. Allison: Apparently Bruce forgot I had a slide as well. So, this enhancement is for the construction of our new wastewater maintenance shop. The current facility -- or the current structure we have out there is the top picture. It's approximately 1,600 square feet. We have three bays, only one of which is actually able to be utilized. The other two are completely full of equipment and parts that are currently being work done. The new facility is under -- the plans are being reviewed right now in our development services downstairs. The new facility is 10,000 square feet of usable space on the first floor and, then, a 2,000 square foot mezzanine structure, which will help keep the equipment and other supplies up away and keep the shop space usable. Right now the plan builds out -- this is the only facility we have onsite to help maintain and repair pumps and equipment that need to go down for regular maintenance and things that may break. So, thank you. Dolsby: Good morning, Madam Mayor, Members of the Council. This next enhancement is for SCADA system upgrades. You have heard SCADA mentioned a couple times already during our presentation. I'm going to step back a little bit and define what SCADA is. The SCADA system, if you look at the definition, are used to monitor and control equipment at the wastewater treatment plant, such as pumps, valves, clarifier mechanisms -- the list kind of goes on and on. And also to control -- monitor and control equipment at remote sites, such as lift stations. So, this enhancement is part of a multi-year effort to fund the purchase, design, and installation of upgrades to the SCADA system at both the base stations, which would be the wastewater treatment plant water division -- it would be City Hall here shortly, and remove terminals, such as lift stations. Periodic upgrades to these base stations and remote terminals are required when they become outdated or obsolete. Notable projects for FY -15 will be an upgrade to The Landing lift station, so during FY -14 we have -- we are in the middle of upgrading both the Black Cat lift stations. And a similar enhancement to this will be presented by the water division. The next enhancement is for plant PLC replacements. This graphic is meant to illustrate that many of our current Meridian City Council Budget Workshop July 9, 2014 Page 19 of 41 PLCs at the wastewater plant are older than the cell phone. So, PLCs are defined as programmable logic controllers. Basically they are digital computers that are used to automate processes, such as control pumps at the wastewater treatment plant. Currently we have outdated PLCs that are no longer supported by the factory at a plant. The PLCs aren't compatible with our new software platform as well and for year one of a two-year just -in -time finance project that will fund replacement of the outdated programmable logic controllers. Next enhancement is for sewer main replacements. This enhancement will fund the design and construction of sewer lines to replace aging infrastructure in the sewer collection system. These replacement projects are identified through the sewer, TV, and cleaning program that Tracy has discussed, as well as through analysis of the collection system age, condition, material and capacity by the wastewater division and Public Works technical staff. Notable projects for FY -15 are the third and final phase of the NW 8th Street sewer project. Also this enhancement is an enhancement that we bring back every year for sewer main replacements. Next one is for sewer line extensions. This is also an enhancement that comes back each and every fiscal year. This enhancement will fund the design and construction of new sewer lines in the collection system. One major driver for these types of projects is Ada County Highway District, the ACHD road construction projects. By these improvements the sewer system, in coordination with road construction projects, the city saves money on pipe installation by removing the need to restore pavement and pay for traffic control. Notable projects for FY -15 include the Ten Mile, Cherry to Ustick, road widening project. This next enhancement is for year one of a three year just -in -time finance project to upgrade the wastewater treatment plant head works. Now, the head works at the wastewater treatment plant is the initial treatment process after the flow goes through the collection system and goes through an influent box and, then, into the head works and it is designed to reduce the level of pollutants in the wastewater through screening wastewater and also removing the grit. This enhancement is part one of a three year project for improvement to the head works that includes influent flow measurement, pumping, grit removal capacity, also screening upgrades and this project will increase the firm capacity of the head works and provide better screening upstream of future nutrient removal processes, such as the side stream nitrogen removal process that Tracy discussed and these nutrient removal processes anticipated required for our new NPDES permit compliance. Next enhancement is part two of a two year project for a site specific aquifer recharge study. So, the aquifer recharge is defined as the replenishment of the groundwater supplies by manmade means and in our case that would be through the use of the reclaimed water system. Currently our reclaimed water system irrigates a city park, Heroes Park, the Ten Mile interchange, Fast Eddie's car wash and the wastewater treatment plant landscaping, but aquifer recharge has a potential to utilize our reclaimed water resources year around to augment the natural groundwater supplies and it may or may not allow the city to meet our NPDES requirement at a lower cost than wastewater treatment plant upgrades to go to Five Mile Creek. So, this Meridian City Council Budget Workshop July 9, 2014 Page 20 of 41 enhancement will delve deeper into that study and provide answers to those questions. Borton: Madam Mayor? De Weerd: Yes. Borton: I wanted to interrupt just while you were on that point. How is this study different than the component of the aquifer recharge that was -- we approved it this spring that they were going to look at that as one of the additional benefits of the NPDES compliance. Do you recall that being -- Dolsby: Madam Mayor, Councilman Borton, I'm trying to recall -- I remember we had discussed it. We had an enhancement -- not last fiscal -- not this fiscal year, but in FY -13 that was related to aquifer recharge where we did a business case evaluation and a study of recharge, but this enhancement is more of a site specific study where we will head out to a couple chosen pieces of ground and actually do some drilling and figure out if they are viable for recharge. Borton: I will find what I was looking for and I will bring it back. Dolsby: Next enhancement is for generator load banks. So, currently at the wastewater treatment plant and also at the North Black Cat and South Black Cat lift station we have generators that are capable of providing full backup power to those facilities, but the National Fire Protection Association requires that these generators be exercised monthly under the load. So, the current method at the plant is to transfer the entire plant load to the generators, which causes two separate disruptions. First is when we transfer from Idaho Power to the generators. The second disruption is when we transferred back from the generators to Idaho Power. But this enhancement will provide the funding to install external load banks, so the generators can be routinely exercised under load without transferring the entire plant to this emergency service and it would also eliminate the power disruptions to the plant's sensitive electronic infrastructure. Crane: The next enhancement is the second of a three year project to acquire, essentially, spare parts, tools, and equipment. The first year we have acquired most of the tools and equipment that we were looking for. What the plant staff has done is we have gone through the plant and sort of prioritized equipment and each one of the unit processes based on criticality and also lead time and due to the high cost of this equipment to acquire, we have tried to set up a budget enhancement so that we can acquire one or two pieces of this equipment each year. This year I think we have two or three pumps that we were looking at and, essentially, what we do is generally we get this equipment, we put the new pumps into service, we take the pumps that they were replacing out, service Meridian City Council Budget Workshop July 9, 2014 Page 21 of 41 them and put them on the shelf in our inventory, so that they are ready if we have any issues. With that I will turn the last one over to Tom. Barry: Thank you, Tracy. I'm sad to say Bruce also forgot that I had a slide with an enhancement on that I need to present. No. We will be talking tomorrow at 8:00 o'clock in my office, so -- De Weerd: As long as you call him Bruce. Probably would as well; right? Barry: Our last enhancement for the wastewater division is the interpretive center request. The interpretive center, as you know, is going to serve as an education outreach facility to promote learning that broadens the public's knowledge, understanding, and support for Public Works projects, programs, plans and services. It will target four different audiences. First, it will target ratepayers by educating them on treatment plant processes, operations, regulatory treatment requirements, phosphorus reduction, capabilities or opportunities and the like. It will also target business owners and operators by informing them about pretreatment requirements, elicit discharges, best practices and also phosphorus reduction opportunities. It will also educate and inspire high school students to consider a career in Public Works, something that's vastly needed in our field. And, lastly, it will aid us as a -- in recruiting talent from other organizations to join our first-class operation. But consider this. The vast majority of people have no idea what Public Works is, what we do, or why it's even important. This makes it difficult garnishing the public support for major public infrastructure or overcoming future challenges, like the NPDES one that we have ahead of us. It also makes difficult the recruitment of a replacement workforce, not just in our industry, but also in our community. This particular facility has been in conceptual design for the last several months and we have developed a design team of over a dozen different professionals, which span university and high school instructors and educators and also incorporates professionals from other areas, including the Boise River -- or, excuse me, the Boise watershed. It has helped us to create the content for this particular facility. Glowing testimonials have already been received from these educators about the facility and its opportunities that will be brought to our community. The facility in and of itself is going to include a number of different components in it that I think will be very informative for our community. It will talk about the history and importance of sanitation in our lives. It will have a model of the current treatment plant process, which will be electronic and be queued off of different processes and educate those on those processes. It will also include the process, value, and benefits of biological nutrient removal and also reuse. It will talk about the sustainability of approaches and projects that we have going on at the wastewater treatment plant. Include wastewater treatment technologies, both past, present, and future. Include the potable water cycle, water production, distribution, collection insights. Bio solids, management strategies and opportunities, environmental sustainability as I have mentioned and careers and job opportunities in the field. One of the most important comments that we get Meridian City Council Budget Workshop July 9, 2014 Page 22 of 41 back -- actually a couple of the most important comments we get back from tours when people go out to the wastewater treatment plant. First of all, I had absolutely no idea. I had no idea how complex it was, how expensive it was, what you guys do. And the second is this is really cool. Particularly for the younger audiences. How do I get involved in something like this. And it's biology, chemistry, physics, engineering and there is all sorts of disciplines that are highlighted in the work that we do, but because nobody knows about what we do, it often goes missed. The American Public Works Association says that about -- that one of the single biggest crises in our industry is the lack of talent that's coming out of the schools. The lack of interest and talent. So, we would like to use this as an option to help change that as well. So, we are excited about the benefits and opportunities that this facility will create for our community and our department by showing that what we do is not only cool, but that it matters. So, with that I will stand for any questions. I and the staff will be able to address any questions you have on the wastewater division enhancement request. De Weerd: Thank you, team. Council, any questions? Mr. Zaremba. Zaremba: Madam Mayor. Thank you all. I think my question is probably directed at the Finance Department and I think I have probably asked this same question every year. For some reason I don't remember the answer, but let me pick an example. Sewer main replacements. If we make the assumption that in order to keep the system up to date we need to replace a certain amount of that every year, let's say we assume it has a 50 year life, we have to replace two percent of it every year no matter what and my question continues to be why isn't that base budget instead of enhancement. If we know this is a regular thing and I know you have answered that question for me before and I'm sorry I don't remember. De Weerd: Well, I thought I would let Charlie answer it. Zaremba: It seems to me it ought to be base budget. Rountree: It's Todd's turn. Lavoie: Madam Mayor, Councilman Zaremba, good question. We do talk about this I think annually. We like to present these annual enhancements, the waterline -- or for sewer line extensions, the replacements. As a practice to make sure we are transparent with you as the Council Members and the citizens. If we start earmarking monies into the budget part of the base ongoing, new Council Members -- Luke, Genesis, Joe, they would not have known about those earmarks in prior years. So, this is just a process that helps educate new employees, citizens, staff members, these are annual requests that we need to acknowledge, especially capital large items like this. Can you implement a process, earmark them? Yes, you can. We promote this practice to help with Meridian City Council Budget Workshop July 9, 2014 Page 23 of 41 transparency with changing of staff, citizens, and that's the primary purpose is just the practice to be transparent and show the data. Can we do it? Yes. But this is just what we have promoted here at the Finance Department and we are open for change if that's requested, but that's the reason we do it. Zaremba: Thank you. And I will try and remember that. Rountree: We look forward to hearing it again. Madam Mayor? De Weerd: Mr. Rountree. Rountree: Can you give me a sense of what the streamside nitrogen treatment equalization consist of? Crane: Madam Mayor, Councilmember Rountree, essentially -- so, the centrate, our digesters after the digested sludge goes to a centrifuge, a high speed centrifuge that separates the liquids and solids. The centrate is the liquid that, essentially, is sent back around for a treatment at the plant. Very, very strong in ammonia and phosphorus. About a thousand milligrams per liter of ammonia. So, extremely strong. And as I said earlier, it represents about 25 percent of the total load among the load that's coming into the facility. It's about the 60,000 gallons a day right now. To give you some examples that -- so, essentially, that 25 percent of the load, the entire amount of the load on the facility is contained in a 60,000 gallon side stream. The idea is to treat that side stream, because it's a relatively small stream and concentrated and knock that ammonia load down before it hits the plant. What happens in our aeration basin is the conversion of ammonia is a biological process. There are no chemicals that we use. So, what happens is you have to size the aeration basins and the secondary system bigger and bigger based on the ammonia load. So, if we treated this in a smaller side stream is more cost effective to deal with it there than to make the aeration system itself bigger to accommodate that ammonia load and, typically, it is ammonia load that dictates the size of the basin, because it is a biological process and it takes the longest of all the nutrients that we are removing. Rountree: Thank you. Makes sense. The CCTV van, that's just an expansion of our existing operation and a modernization of the equipment on our existing equipment. That will still remain in service and would function to do the inspections; correct? Crane: Madam Mayor and Councilman Rountree, that is correct. We are seeking to add an additional van and camera and, then, upgrade the existing one. Essentially we would standardize the equipment between the two as well. Rountree: The facilities maintenance shop, you didn't say it, but I'm assuming that's also going to be a warehouse for your spare parts and keeping your inventory or are you going to expand that facility to some other spot on the site? Meridian City Council Budget Workshop July 9, 2014 Page 24 of 41 De Weerd: We are not going to forget him twice Allison: Madam Mayor, Councilman Rountree, we are not planning to house and store any -- any spare parts here at this time. We had proposed at one point having a storage facility, but that has been put off until we know what we need to deal with the NPDES permitting currently. Rountree: So, I guess my question is where will the storage of these additional parts take place? In the existing facility or in a new facility or an off-site facility? De Weerd: This is a team effort Barry: You bet. Thank you for your question, Councilman Rountree. As a matter of fact, that request was made this year for an inventory facility and it was denied until we matured that particular program a little bit more. We didn't want to invest the money in developing that site. It will be a different building located at the wastewater treatment center or facility in a different location, so -- and we have ground that has been sort of designated for that particular facility. We were going to go into the design phase this year with the request to the Council for that, but I don't feel comfortable at this point in time in the maturity of the program to be asking for capital dollars for a design to -- design a facility that we don't yet know what we really need yet until that program is fully vetted more. Rountree: Thanks, Tom. Cavener: Madam Mayor? De Weerd: Mr. Rountree, anything further? Rountree: No follow up. De Weerd: Okay. Mr. Cavener Cavener: The question is about this -- this interpretive center. One, I applaud your efforts to engage with the public on information that sometimes is complicated and over the head of the general public. You touched on some partnerships with educators and I was curious if you could share what type of commitments they have made to provide people to come through this facility. Are we in a if -you -build -it -they -will -come mentality or have we forged partnerships that we expect to see students coming through here as part of a regular field trip? Barry: That's a fantastic question, Councilman Cavener, and I'm going to lean to Mollie Mangerich as she comes out, but before I will attempt to address a couple of your questions. The partnerships that we have developed so far in the design Meridian City Council Budget Workshop July 9, 2014 Page 25 of 41 concept phase include educators from a couple of the high schools around, as well as Boise watershed personnel and in addition University of Idaho education personnel. I believe that the notion at this point in time is if you build it they absolutely will come. Just as an example, the Boise watershed right now services 14,000 visitors every year. Those visitors are mostly between the age of, you know, six and about 14. Our particular facility is designed to capture the older crowd. It is meant for 8th grade and above. That will be, essentially, the target audience here and with an emphasis on high school and the idea is the high school curriculum will be adapted in such a way that would allow for field trips to be included for special high school classes to come out to the wastewater treatment plant, which is, again, why we included a nice turnaround in the development of the parking facility out there as well for buses and those types of things, which has already been predesigned and constructed. I would like Mollie Mangerich to come up and maybe expand on this. She's our environmental division manager, so -- Mangerich: Thank you, Tom. Excellent background. So, to answer your question, Commissioner, we started out with a focus group and we hand picked and received a lot of interest to become a part of the focus group of Treasure Valley science teachers, University of Idaho water quality programs. There was expressed need for a facility that provided a higher technical experiencial experience to meet the science standards that are currently in place within the state and that there was a want and a need for the biological, chemical, engineering, sustainability, social aspects and so we brought those components in and spoke with them and got feedback with our ideas on what should be placed in this interpretive center and that's why it's very discretely placed for the separate target audience which Tom just provided you. What is wonderful -- and we are receiving a lot of compliments in this -- is that we have been thinking collectively forward, so that we are actually developing an interpretive center that is compatible with the very popular Boise watershed facility, which all of our second graders here in the City of Meridian get to be bused to and tour through with the help of a grant through Micron. So, there is a lot of interchange, collaboration and symmetry between both of these facilities that will be net positive for our Treasure Valley we believe. De Weerd: So, Mollie, have you pursued a grant through the Micron foundation? I think they always look for opportunities to promote, you know, the education components and I would imagine because of the target audience you're looking at this would be ripe for a grant from them. Mangerich: Thank you, Madam Mayor. Yes, they are on the list of those who we would target for assistance and further development, education, and also in participation. De Weerd: Very good. Meridian City Council Budget Workshop July 9, 2014 Page 26 of 41 Mangerich: Really good. Cavener: One follow up, Mayor. Along those same lines I guess my follow-up question relates to the -- all these organizations that have indicated a significant amount of interest in participating, have they been willing to put any -- for lack of a better word -- skin in the game and help keep this facility funded or are they really relying on the city to do that job and once it's built, then, they will, then, send students to come and attend? Mangerich: The focus group participants were primarily educators, so those are not the funding target group. Cavener: Okay. Mangerich: However, we haven't been in conversation with Department of Environmental Quality and one of the rooms within the facility is dedicated to the Meridian water cycle, that's the potable water cycle side. There is some funding available from their source water protection program. I have met with them and been in conversations with them. We will have an idea of what a contribution will be about August. Cavener: Okay. Mangerich: So, there is something like that. And, then, there is also a list of the private sector potentials that could gain benefit from becoming a partner with us as well. Cavener: Thank you. Mangerich: I think it's really important. De Weerd: Any other questions while we have Mollie up here? Thank you, Mollie. Mangerich: All right. Well, thank you. De Weerd: Any other questions on the wastewater treatment plant enhancements? Or what are we calling it now? We are not the WWTP anymore, are we? Barry: I'm glad that you asked, Madam Mayor. I have been meaning to tell you that as part of the improvements at the wastewater treatment plant we have been compelled to develop new signage and we have gone through a long process of trying to identify what would resonate better and better describe what happens at the wastewater treatment plant and be in alignment with what the industry standard terms are and so the wastewater treatment plant, as it has been Meridian City Council Budget Workshop July 9, 2014 Page 27 of 41 commonly known and endeared for years and years, has been renamed to the Wastewater Resource Recovery Facility. Now, I know going forward it will probably -- De Weerd: That doesn't flow. That doesn't flow. Barry: Yeah. It doesn't flow yet. Give it time. So, the signage that you see on Ten Mile Road will be -- will enumerate that and it will be called the Wastewater Resource Recovery Facility, because we feel like it is a resource that we are trying to recover and that many of the sustainability initiatives like struvite recovery, which is a slow release fertilizer, that we would like to harvest out of the wastewater treatment plant. Biosolids, which we would like to do a better job of reusing the reclaimed water program -- all of these things are recovered from the wastewater treatment plant as a resource and, therefore, the term makes a lot more sense. De Weerd: Charlie had a better idea. Barry: Oh -oh. Cavener: The Rountree Resource Recovery? De Weerd: Well, it's kind of like the bark park. Rountree: No. The Aquatic Resource Recovery Facility or ARRF. Barry: ARRF. De Weerd: See? Barry: Ouch. Okay. Bird: ARRF instead of barf. Barry: Maybe we could put a B in front of that and call it biological. Milam: There you go. Barry: All right. Okay. Thank you very much. If there is no further questions I will introduce the Water Division and their enhancements and I think that we can be finished and ready for deliberation before noon. So, as some time management. De Weerd: No pressure, Dennis. You got that from John. He always brings props. Meridian City Council Budget Workshop July 9, 2014 Page 28 of 41 Bird: Visual aids. Teller: Okay. All right. Well, good morning, Madam Mayor, Members of the Council. I'd like to thank you for your time today in reviewing the water division's 2015 budget enhancements. In the following Water Division presentation Kyle, Clint and myself will be going in great detail. A total of 22 individual budget enhancements for your consideration. The requested Water Division budget this year totals a little over 4.1 million dollars and is primarily focused on SCADA system improvements, distribution system improvements, and water quality projects necessary to improve operations and keep up with our current growing water system demands and with that I will turn it over to Kyle for our first enhancement. Radek: Dennis, if you want to go into your great detail that's your business. I'm going to cover the important topics. Our first enhancement is our source water protection program. We are requesting 60,000 dollars ongoing. We have been requesting enhancements for this program for several years and although our requested amount has decreased significantly since work began, we are now requesting this on an ongoing basis, because we continue to have challenges and opportunities in this area. This work is some of the least expensive and most important work that we do to insure a viable future for the city water supply. We have made significant progress lately, including completing our well database, actively enforcing higher well construction standards in the Meridian impact area for other people's wells. Completion of a report that documents and interprets over 17 years of well monitoring data and the acquisition of over 19 cubic feet per second of licensed water rights. Just as an aside, 19 cubic feet is about 12 million gallons of water a day, which is over our current average day demand. That is a significant achievement over the last few years, because of this enhancement. This work endeavors to, number one, understand the quantity and quality of our water supply resources, protect our water supply from contamination and insure future access to our water supply. Some of this enhancement will insure that we continue to complete work that will accomplish these goals. Teller: Okay. Enhancement number two, this was a request for the addition of a lead operator within the distribution section of the water division. The water division system is made up currently of 450 linear miles of water lines and the newer infrastructure items, such as fire hydrants and valves. The water system has grown dramatically over the past decade and has continued to grow at a substantial rate. We have seen about 22 percent increase since 2006. This additional system growth has reached a point now that it requires additional staffing to keep up with our maintenance and repair needs. We currently maintain 45 fire hydrant, 4,500 valves, 19,000 water services and 29,000 water meters within our water distribution system. Items such as fire hydrants and valves need to be serviced individually every four years to insure that they are operational ready and prepared for emergency use. These activities are Meridian City Council Budget Workshop July 9, 2014 Page 29 of 41 becoming more and more time consuming and are requiring more staff to assist with their timely completion and a good example of this is our Dig Line program. We have recently hired a new staff for that and that program is going very well with that additional help. As such we are starting to see the same staffing needs in our repair efforts due to our increased growth and system age. Repair activities are becoming -- we are beginning to start to fall behind with our limited staff and we need to try to keep up. Although we have completed over 98 large system repairs over the past year on fire hydrants, valves, and water lines, we have an ongoing list of repairs that still need attention. This list will only increase as our system ages. Currently only two full-time staff are dedicated to complete these repairs and this new position will provide an additional operator to lead the staff and assist with these repair activities. Additionally, it will assist our chief water operator by allowing him to concentrate more time and management on our growing maintenance program, such as our Dig Line program and valve and hydrant programs. The addition of a lead operator will improve efficiencies and timeliness of repair activities that will allow us to keep up and overall assist in providing a better, more reliable service to our customers. Worthington: Our next enhancement is for some water system upgrades -- SCADA upgrades this enhancement is for the purchase, installation and permitting upgrades to the SCADA system both at the water department base station and remote terminal, including wells, storage facilities, and PRVs, pressure reducing valves. There are 47 remote sites throughout the city and these components of these SCADA upgrades consist of PLCs, which are programmable logic controllers, radios, their cabinets antennas, and ancillary parts. This request will create improved radio communication, fiber links, and operational control. Projects under this enhancement will result in upgrades to the SCADA system to allow for a faster, more reliable and efficient means to monitor and control water system facilities. This request is a third year of a four year plan for SCADA upgrades in accordance with our SCADA master plan. Teller: Okay. Enhancement number four in the amount of 35,000 dollars is for the purchase of a vehicle gateway base station or what we call a VGB. This electronic equipment will be utilized by our meter reading staff to remotely capturer our 29,600 meter reads monthly and upload them into our meter -- or our billing software. This equipment is required to be fully utilized in the transmission and data collection capabilities of our replacement water meter transmitters. The VGB radio system -- reading system will allow for full use of our new generation transmitters that will now transmit an increased power signal that will give the operators the ability to capture reads over a larger area. This will improve our efficiencies by reducing our drive times needed to capture reads and improve customer service through more detailed usage data. Enhancement number five in the amount of 50,000 dollars is for the retrofit intelligent chlorine injection pumps. Injection pumps are essential for critical -- or an essential and critical component of our water production facilities and we rely on these pumps to inject chlorine disinfectant in the exact dosages to maintain the adequate Meridian City Council Budget Workshop July 9, 2014 Page 30 of 41 water system protection. This is our first line of defense to minimize oxidation reaction that is currently causing iron and manganese problems. That's the large source of our brown water issues. Our pumps being 20 years old, are reaching their useful end of life and aren't able to perform as accurately as needed. This retrofit will work in conjunction with current SCADA system improvements and we will find not only better accuracy, but critical feedback information, such as voltage flows, alarming, and operation performance data. These pumps are more accurate and are more reliable than our existing pumps. With this better control capability operators will be able to accurately manage chlorine dosages and will have direct influence on improving the water quality which we deliver to our customers. Enhancement number six is for the purchase and development of a conditioned based monitoring software for our SCADA system. With the recent completion of our phase one asset management plan, we are now positioned for the incorporation of conditioned based monitoring software. This software will analyze existing operational data available from our SCADA system currently and utilize it to automatically monitor and generate repair and maintenance work orders based on specific operational conditions. Currently this operational data is captured manually by system operators and physically entered into our asset system. This method is time consuming to collect data and enter into our system and this manual data entry is vulnerable to input error and cannot be collected on a continuous basis that our SCADA system provides. Data currently can only be collected once daily and requires physical visits to 20 plus well sites. This software will reduce the dependency on our manual site visits and, more importantly, help predict and alert operators to potential critical equipment failures based on operational parameters. The software will improve operations through implementing just -in -time proactive maintenance, which will free up staff resources needed for the operations of our upcoming water treatment facilities coming next year. Enhancement number seven in the amount of 70,000 dollars is for professional services to help assist with the remaining programming and development of phase two and the start of phase three of our asset management plan within the water division. With the unique water system features of Meridian, professional programming assistance is required to ensure that the development of our asset management system is fully utilized, it's end user friendly, and functional on a day -in, day -out basis. To give a brief update, it will help complete the phase one of our asset management plan and it was completed on time, ahead of schedule, and it captured, as Tom said earlier, over 17,000 water system assets. Currently phase two, which started in March, is underway and consists of incorporating an additional 29,600 water meters and service assets. Upon our phase two completion approximately 46,000 assets will be tracked and maintained within our asset management system. Radek: Well 16 and pumping facilities is the final construction project necessary to replace pumping capacity lost with the abandonment of the original Well 16 due to uranium and well construction issues. We have completed a new test well and two production wells. This project is the first that we have designed specifically to mix water from two discrete production wells on the same well site Meridian City Council Budget Workshop July 9, 2014 Page 31 of 41 in order to optimize water chemistry supplied to customers. We are requesting 320,000 dollars to equip the new wells and existing building with public facilities to get this important water source back online. We are requesting 500,000 dollars for water line extensions for FY -15. Our main water line extension project for FY -15 will be construction of water line from Black Rock Subdivision to Reflection Ridge Subdivision to tie these two islands of pressure zone five together. This will improve water quality and operational flexibility and system robustness. Development of pressure zone five is also critical for enabling water distribution to south Meridian. Constructing and adjusting infrastructure in conjunction with ACHD or ITD road projects in order to minimize cost and inconvenience to the traveling public continues to be a primary purpose for waterline extension funds. In FY -15 we have waterline extension work in conjunction with ACHD Ten Mile Road, Cherry to Ustick, project. Teller: Enhancement number ten in the amount of 27,000 dollars is for the purchase and incorporation of a Shore Tel phone system for the water administration office. This enhancement has been requested to replace the current phone system and bring it into alignment with the city standard Shore Tel system. This will provide a more versatile communication connection for our customers, as well as our staff. This phone system will provide options such as automatic forwarding, extensions to -- and the connectionability between departments to handle overflow calls, provide menu options for frequently asked questions, plus it will provide the necessary communication flexibility required by the city's emergency response plans and continuance of operation plans. Overall -- the system will increase overall options and flexibility of our phone system for better, more versatile operations, while providing the customers a more convenient and overall better customer experience. Enhancement number 11 in the amount of 125,000 is for the one time purchase and installation of nonflip water lid valves within the rights of way with speeds over 35 miles an hour. With increasing traffic flow over main streets throughout town, more and more water valve lids are becoming dislodged from the street and causing traffic hazards and in some case damage to vehicles. The dislodged lids have been an ongoing and ever increasing challenge to prevent until a recent solution was found in the form of these new nonslip lids and I have got one of them here as an example. The new lids are currently made of a composite plastic and they are sealed with rubber diaphragms to actually hold them into place in the street, so they are not pulled out by the tires. Previous designs that everybody has used historically are a cast iron. They weigh about 20 pounds and this is actually the same lid found in the photo here. When they flip upside down they cause damage -- you end up with valve lids like this, we get complaints from our customers in the form of pieces of their rims. So, basically, these lids are a little bit more versatile than the traditional ones and they reduce damage claims. Additionally, they are going to be color coded as you can see, so they will identify where our water valves are and they also act as a debris cap and keep water and silt from entering our valve cans. When we get the traditional lids anything can just filter in off of the street and that covers up the actual operating of the valve, so that way when we do Meridian City Council Budget Workshop July 9, 2014 Page 32 of 41 need it we can access it. This minimizes the time that we need to actually access the valves in the street and improves the safety of the operators and, more importantly, reduces the hazards to our public. We have piloted several hundred of these lids over the past year with no failures and this enhancement will retrofit all main arterial streets with approximately 3,500 of these new lids. Our next enhancement is for water main replacements. This enhancement is for the design and construction of waterline projects to replace old, leaking, undersized water mains or water mains made of substandard material. Replacing these water mains will ensure the water loss -- water loss that is due to leakage is kept to a minimum and the main breaks is reduced. Water quality is sustained and fire flows are maintained or improved. This is a yearly enhancement to maintain progress with our waterline replacement program. Six projects are planned for 2015 under this enhancement. Radek: We have three enhancements relating to water treatment that will allow us to continue the groundwater correction program that we presented to Council a couple years ago. These projects will improve water quality and customer satisfaction by removing iron and manganese from water supply. We are requesting 400,000 dollars to fund year two of a two year project to design, procure equipment, and construct a water treatment facility at Well 19. Initial product testing equipment procurement has been completed on this project and we plan to build out construction at the beginning of FY -15. We are requesting 600,000 dollars to fund year one of a two year project to design, procure equipment, and construct a water treatment facility at Well 27. And, finally, we are requesting 100,000 dollars to fund the remaining work to complete a -- complete pilot testing of aquifer conditioning at Wells 22 and 18. This is an alternative method of removing iron and manganese by injecting oxidized water into the aquifer, which causes the contaminants to come out of solution in the aquifer. Teller: Okay. Enhancement 16 in the amount of 24,000 dollars is for the purchase and incorporation of an audio visual system and wireless WIFI connection for the water administration building. The water administration office currently has three conference rooms utilized solely by staff and outside affiliations for meetings and training events. None of these rooms are currently fitted with equipment needed for training and presentation needs. These upgrades will improve the efficiency and versatility of these rooms by providing audio visual and network access through options to presenter staff and visitors. Enhancement number 17 in the amount of 25,000 dollars is for the purchase of equipment required to better compliment our routine maintenance and emergency repairs in our water distribution system. With maintenance repair activities increasing, critical equipment such as concrete saws, asphalt saws, boring machines and capable surface vehicles are required to minimize damage to the right of ways, expedite our excavations, and carry the necessary tools and parts needed to perform maintenance and repairs. With our system aging and failures increasing, as I stated earlier we had 98 last year that we completed in Meridian City Council Budget Workshop July 9, 2014 Page 33 of 41 house -- this equipment has become critical need for our daily operations and, more importantly, for emergency situations. It will allow for better utilization of existing excavation equipment and reduce impact and damages to streets. Radek: We are requesting 25,000 dollars to conduct a feasible study to determine our options for upgrading our existing -- upgrading or constructing a new pump house at Well 11. The existing building is reaching the end of its service life and the project goals will be to improve safety, site security, and accessibility at the building. Teller: Enhancement No. 19 in the amount of 50,000 dollars is for the design and repurposing of our existing Well 14 building. The Well 14 site on Overland Road was originally designed as a well and booster station combination and subsequently is a larger than a normal well building, as it was constructed to house the extra pumping equipment. With the booster pump now gone, all that remains is a single production well, along with some remnant piping and unutilized space. With the city continuing to grow, drive times have increased making it more difficult for our operators to quickly gain access to parts that are normally housed at our 8th Street office. This enhancement will modify and repurpose the building into a much needed storage facility that will be utilized for storage of critical parts, tools, and traffic control equipment. This building modification will increase operational efficiencies by decreasing response times needed for gathering parts and improving our customer service. Radek: We have two enhancements from new wells to serve the water supply needs of our growing community. We are requesting 350,000 dollars to fund the second year of a three year project for design and construction of Well 29. This will be the first supply well in the newly created, but rapidly growing pressure zone number one, and we are requesting 210,000 dollars to fund the first year of a three year project for design and construction of Well 30. This will be the second supply well in pressure zone five. And with that we have concluded our enhancement presentation. We will stand for any questions. Barry: And, Madam Mayor, if I will, this is it for the enhancements and request in our budget presentation for this afternoon. So, you're free to modify your agenda and schedule as you see fit, of course, but we will stand for the questions on the Water Division amendments -- or, excuse me, enhancements at this time. De Weerd: Thank you. Council, do you have any questions at this time for our water division? Cavener: Madam Mayor? De Weerd: Mr. Cavener. Meridian City Council Budget Workshop July 9, 2014 Page 34 of 41 Cavener: The WIFI and injection system, I assume that's run through and IT is on board with that as equipment that they support and will be able to troubleshoot should any issues occur? Teller: Madam Mayor, Councilman Cavener, we have consulted with IT on this the entire way and they have assisted us with the -- not only the equipment procurement, but quoting them and everything. So, they are completely prepared to support this. Cavener: Great. Holman: Madam Mayor? De Weerd: Yes, Jaycee. Holman: Madam Mayor, Members of the Council, just so that the Council Members know and Councilman Cavener, all of the amendments, both Enterprise and General Fund, get vetted through IT. If Finance sees anything that they think is an IT item or -- I'm not sure if you send all of them or just the ones that you see as having an IT impact. Okay. So, we do see all of them and Dave and Mike review all of those at the very beginning of the process. Cavener: Thank you. Milam: Madam Mayor? De Weerd: Yes, Mrs. Milam Milam: I have a couple questions. One is related to this -- the same item, the WIFI and upgrade -- upgrades. This is for the new building or is this -- Teller: Madam Mayor, Council Woman Milam, this is for existing water admin building at 8th Street. It's about eight years old. Milam: Okay. And the other question -- on the condition based monitoring system, sounds great, but it's also -- it sounds like it's going to save somebody driving around to 20 locations a day, which means we have extra personnel maybe? Teller: Madam Mayor and Councilwoman Milam, you are correct. With that that is going to free up our staffing resources for the treatment facilities that are coming on board next year. So, if we can incorporate this come fall we should be ready for that transition and be able to shift those resources over into treatment concentration. It will not completely take over the need for physical inspections, there still needs to be a physical look, touch, smell to these facilities, but the overall data capture that happens everyday is currently taking place with our Meridian City Council Budget Workshop July 9, 2014 Page 35 of 41 SCADA system and this will incorporate all of that data into our asset management and workflow. So, it will free up our time. Milam: Thank you. Rountree: Madam Mayor? De Weerd: Mr. Rountree. Rountree: This may or may not be a budget question. When you showed this slide of the SCADA cabinet this question came to my mind. How vulnerable is the SCADA system to hacking or disruption from external electronics and do any of the upgrades and whatnot that you're proposing address that, if, in fact, it is an issue? Teller: Madam Mayor, Councilman Rountree, that's an excellent question and it's something that we are very, very concerned about, because we want to make sure that our system is as less vulnerable as possible and currently our SCADA system is not connected with the city's network, so it is a stand-alone system that is not vulnerable to anyone from the outside getting into it. If that answers -- Rountree: That's reassuring De Weerd: Any other questions? Teller: Thank you. De Weerd: Thank you. Bird: Let's break for lunch. De Weerd: Council, if you -- this is probably a good time to break for lunch and, then, we can resume at 12:30. Okay. Good deal. Well, then, we will recess until 12:30. (Recess.) De Weerd: Okay. I will go ahead and reconvene this meeting and at this point we will follow the same the process that we did yesterday. You should have a summary for the Enterprise section in terms of the enhancement requests that you have in front of you that's in the summary section of your binder. If we want to just go through it section by section like we did yesterday. So, the first part is under the Public Works starting with the asset management analyst and that section. Any questions in that? Under water? Rountree: I don't have any. Meridian City Council Budget Workshop July 9, 2014 Page 36 of 41 De Weerd: Okay. And we can scroll down to wastewater. Bird: I think everything is needed myself. Rountree: Madam Mayor, I just -- I just had a question on -- I'm trying to recall. I thought I saw on number 16, the head works upgrade, but to include odor control; is that correct? Okay. All right. Bird: Kind of an expensive carpet. That's a joke. Rountree: I don't have any other questions. Zaremba: Madam Mayor? De Weerd: Mr. Zaremba. Zaremba: I guess I would ask a timing question and I'm looking at the laboratory analysts. What is the relationship between hiring them and the completion of the lab, which is currently being built? Crane: Madam Mayor, Councilman Zaremba, the lab is scheduled October, November'ish it appears. It's a little bit behind the admin building, but I'm told they are catching back up. We have had discussions with HR already about trying to get out in front of it and get the advertisements out there and get the recruitment process started. We wouldn't actually bring those positions on until after October 1. We would like to get those folks on as they deliver the new equipment and the reps come in and do the setup and the training and all that and have those folks available at the startup of the lab, because it puts them that much further ahead, but we are thinking that it's coinciding pretty close to about the right time, hopefully. If that's -- for lack of a more concise answer. Zaremba: Well, that's good. Thank you. De Weerd: Thank You, Tracy. Any other questions on -- as it relates to our waste resource something. Our WRRF. Okay. If there is nothing further for our Enterprise Fund, anything further to discuss in the General Fund? Cavener: Madam Mayor? Not so much a question, but more of just a comment. Building off of Councilman Borton's comments from yesterday about taking the three percent. I personally struggled with this issue myself since the budget process began and after going through the process, hearing from staff and their very detailed report, I'm more in favor of it now than I was at the start of this process, but I guess I would ask staff and you, Mayor, moving forward, that this three percent to be viewed as an exception, not as the rule. In discussion with a lot of different staff members it seemed like the three percent is the rule and that Meridian City Council Budget Workshop July 9, 2014 Page 37 of 41 -- that causes me great concern and so I would hope that as we move forward in years to come that as we go through this process that staff are looking at it only as a have to, not as a standard operating procedure. De Weerd: I appreciate that comment, Mr. Cavener, and I can assure you that it is -- it is fully vetted every single year, not only by -- through the months leading up to the workshops, but also with our Council Members as well. It's never a for granted to your comment. We'll take them to know it. Kilchenmann: Madam Mayor? De Weerd: Yes. Kilchenmann: Madam Mayor, can I make one more comment about the three percent and, then, I will stop. The thing of the three percent -- this is the General Fund and mostly the General Fund is public safety personnel. So, if we look at not taking the three percent over time, we can increase that personnel base. So, that's where the issue becomes complex. So, we can take out one time items, like the parking lot or the Finance projector and we can balance the budget for one year, but when we look forward and we look at new construction is not going to stay at the level it is, it's already starting to dip, we don't have any way, not only to not grow, but we can't just stay with what we have. So, when you look through and you look at like the cost of the police vehicles are increasing, we will talk to the police next week about the STEP plan increases, those are the things we just can't maintain without some kind of growth in our revenue source. It's not that it can to be done, it certainly can be done, but you have to really -- when you think about that you really have to look at the base public safety personnel costs. So, that's my three percent plug. Milam: Madam Mayor? De Weerd: Mrs. Milam. Milam: I have a related comment as well, because, obviously, this is what we struggle with. This is my first year doing this, so I'm also trying to understand, but the tax base is going to increase based on the values of our homes going way up this last year and so -- so I still struggle with that and I don't know why it has to be -- it's like three because we can, it's either three or none. There is also one and one and a half, there's two -- there are other numbers. The other thing is with the three percent increase in pay and the compensation plan, the average Meridian citizen makes -- the average Meridian -- median household income is 65,000 dollars. That's most of the time two people working. Our average employee base wage -- now, this is just companywide -- is somewhere between 70 and 80 thousand. So, for me to tell my neighbor our employees make more then your household, I need to raise your taxes to give them a raise, I struggle with that. Meridian City Council Budget Workshop July 9, 2014 Page 38 of 41 Kilchenmann: Madam Mayor? The formula for calculating the individual property tax is -- it's partly based on -- when the value goes up on taxing property, what that does is it changes the denominator in the calculation, so it makes our levy rate go down. So, actually, our levy rate goes down, but your taxes go up because of the overall increase, if that makes sense, because the enumerator is -- stays at lesser increases, so what you pay in property taxes is like taking a pie and, then, slicing it all kinds of different ways, depending on the value of your property. So, commercial property paying about 40 percent, 45 percent of the tax burden. The calculation is different. It's a different -- it's more based on the revenue base. So, it's a little -- it's complicated, but it's a factor of a lot of different things, but the amount of the property tax revenue basically is fixed. So, we know what it is a long time in advance. So, the only way to change that -- the new construction -- if new construction kept going we would keep generating more income. Now, we keep spending more income, because we would be -- if we were hiring more services to service, you know, more traffic, et cetera -- now, you can stop that. I mean we can control growth. We definitely -- that's an option. So, it's not that it's not an option, it's just -- I want to caution you where there is a stopping or a slowing in cost has to come from. De Weerd: And I think that this has been a discussion for the directors for some time. Every time you approve another plat it means our service demands continue to be stretched and our service levels are stretched without -- as Stacy mentioned yesterday in her opening remarks, our tax collections are two years behind, but your service demands are immediate, and so there is a balance and what is that balance? I can tell you that my property value is what it was now in 2006 and I'm paying the same amount of taxes that I was there then. I never complained when I saw my values go down, because I paid less in taxes. Someone was making up that gap. I'm back to what I was paying then and I'm getting the same service -- every year I have gotten the same service. Someone is paying for that service and if we want to look at our service levels and say we are okay having less service than we can look at our budgets a little bit differently. But at this point when you look at our base -- you almost have to look at the replacements as part of that base and probably half of the enhancements as part of that base, but that's not how we have done in the past. So, it's a little bit misleading and what is -- what is new service levels through the enhancement or keeping up with the growth versus just maintaining it. Rountree: Madam Mayor? De Weerd: Mr. Rountree. Rountree: I think what's been said is -- is good to hear and to the folks new to the Council my advice to you is don't unnecessarily buy into one thing or another. Vote -- vote your conscience. We have a number of weeks yet before the hearing on this. I will tell you from experience in 15 years with this that if Meridian City Council Budget Workshop July 9, 2014 Page 39 of 41 anybody more than Ralph is here from the public to testify I would be pleased. I think the most I have ever seen at a budget hearing from the public it was three people. But right now -- I was in the audience that year. I was not a -- you did it to yourself. Anyway -- De Weerd: The previous Councils had done it to us. Bird: We had a department that -- Rountree: Anyway, getting back to the point is we have an opportunity -- we have heard this budget and an honest representing what is the thoughts and needs of the folks that are running the city for us. Hopefully, you have understood it, you've had an opportunity to digested it, this is one of the few opportunities that you actually get information and get some time to really sit down and think about it. Typically you want the information and an instant decision from counsel. We don't need to do that this year for this item. So, take your time. You've already started to do the math. That's good. And have the opportunity to hear whatever public comment is and maybe be ready to express your opinion and vote your conscience. That's what you have been asked to do by the people who elected you to office you have to, in my opinion, represent what you represented when you asked for their vote of confidence and go from there and really and truly if you have questions, work with the department heads, work the liaisons of the departments. You as liaisons to the departments certainly have the opportunity to sit down with your departments and get more or less comfortable with what's been said, so you can fully support it or maybe make some recommendations that generally I support it, but this item needs to go. You heard yesterday that we have the ability to add or subtract from -- like we just did enhancements, but from the budget in particular. So, if you see something there and you want to ask a question about it, do it. And, then, come prepared to represent those issues and get a sense of the Council or up or down, we will take a vote, we will have a budget, be ready to go and -- whatever budget we come up with I know that the city staff will go out there and do the jobs that they do in the best way they can given the resources that we have been able to give them. So, that's my advice to you in dealing with this. It does get personal at times and -- but, you know, it's -- it's what you have been asked to do, so go do it. Zaremba: Madam Mayor? De Weerd: Mr. Zaremba. Zaremba: And I appreciate those comments. I would add one more thing and that's something that it took me awhile to grasp and when we are talking about talking with our neighbors and other citizens about the three percent, is to be clear about what that three percent means and what it applies to. The city's budget can grow by three percent a year without us having to go to a vote of the Meridian City Council Budget Workshop July 9, 2014 Page 40 of 41 voters to increase the mill rate. That three percent isn't actually an increase in mill rate -- I know everybody shares that as saying my property tax is going to go up three percent and there is -- there is a direct correlation, but there isn't a percentage correlation in that respect. Our property taxes go up and down really more affected by the assessed value of our property, which the Mayor has already said, but, as I say, there is a tendency and even I at first thought, oh, three percent, my property tax is going to go up three percent and we do have Finance explain the calculations and what it is, but they do tell us how that does affect specific target houses that they tracked from year to year and I just wanted to point out that where the property tax has changed -- they don't change by three percent just because our budget changed by three percent. That's spread over an awful lot of kinds of taxes and inputs and outputs and all sorts of stuff. So, I'm just throwing that in to bear it in mind. De Weerd: So, at this point is there any further information we need from the directors? Rountree: I would ask Finance if they need anything clarified from any direction we may or may not have given them. Kilchenmann: Yes, Madam Mayor and Councilman Rountree. So, what I understand is at this point we will take what we have that was presented to you, we will put it together, it will come back just as a total for the notice and, then, the actual decision will be made at the public hearing. So, I won't have -- we probably won't have anyone present again at the public hearing about individual enhancements, but I will come up and give some sort of format and if anyone has any suggestions on what they would like to see to kind of consolidate the presentation be sure to share those with me. We will update new summaries and, everybody, I will give you hard copies so I won't crash your hard drives. So, you can look at them, so is that -- Rountree: Yes. Kilchenmann: And I really do encourage you to talk with the departments or come and talk to us, because it makes us feel needed. So, I like it when you come and see us. So, we really encourage that and appreciate it when you do come and talk to us and ask questions. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: And we need to remember that what -- the final figure that she comes out with at this point, we can deduct from, but we cannot add to, so -- and I -- I feel that I'm ready to get this number published and we have got three or four weeks Meridian City Council Budget Workshop July 9, 2014 Page 41 of 41 to decide if we want to chop anything out and got the public hearing, which we can do that at. Rountree: And that date is August -- Kilchenmann: 19th. Rountree: -- 19th. De Weerd: Okay. Zaremba: Madam Mayor? De Weerd: Mr. Zaremba. Zaremba: Do we need a motion to publish -- authorize publishing or does that -- De Weerd: I think we will bring back the numbers and that's when we will need your Council action. Correct? Okay. Rountree: So, that's an agenda item. De Weerd: Yes. Okay. If there is nothing further, Council, I would entertain a motion to adjourn. Rountree: So moved. Bird: Second. De Weerd: All those in favor say so go Holland. All ayes. 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L•r 4Y� �.Ad —"iv.n •:r�'•'yy�'rrL• I� r ..� �T.\ jN Al t t At J ' City of Meridian FY2015 Revenue Forecast 25,000 20,000 15,000 10,000 5,000 0 First Step — Forecast New Construction Idaho Economic Forecast Housing Start Predictions �—Hou sing Starts Forecast 2008 Housing starts Forecast 2 -- -tarts Forecast 2010 tarts Forecast 2011 tarts Forecast 2012 tarts Forecast 2013 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 ■ New construction is the key to almost all municipal revenue sources. ■ Challenging ■ Always use a "grain of salt" Forecasts tend to be optimistic ■ Idaho specific sources include; ■ Idaho Division of Financial Management Economic Forecast ■ COMPASS ■ Idaho Department of Labor ■ Impact Idaho lousing Units Actual and Forecast Idaho Housing Starts May 2014 Idaho DFM Economic Forecast 25,000 Difference 20," 24,150 30,274 15,Wo lultifamily 2,994 lO,Wo S,OW 2,041 otal 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 ■ New construction is the key to almost all municipal revenue sources. ■ Challenging ■ Always use a "grain of salt" Forecasts tend to be optimistic ■ Idaho specific sources include; ■ Idaho Division of Financial Management Economic Forecast ■ COMPASS ■ Idaho Department of Labor ■ Impact Idaho lousing Units Total in 2013 Total in 2023 Difference ingleFamily 24,150 30,274 6,124 lultifamily 2,994 5,036 2,041 otal 27.144 35.310 8.165 1000 s00 6W 4W 200 0— Residential Building Permits Actual and Future Actual Actual Actual Actual Actual Actual Est. Est. Est. FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 Residential Building Permits Annual # Multi -Family Units Building Permits Sold FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 YTD Residential Development • Multi -family becoming more of a factor, national trend as paradigms of home ownership change. • As of June 30,2014 year to date residential permit sales are 20% less compared to same time last year. Forecast Residential Building Permits COMPASS 2023 700 600 500 400 300 200 100 0 Est. FY2018 Est. FY2019 Est. FY2020 Est. FY2021 Est. FY2022 Est. FY2023 Forecast Residential Building Permits Commercial Development Dollar Sales Commercial Building Permits Sold $1 316, 53 $1 371,178 S 33,2 7 S 79,4 4 51 118, 33 $1 138, 07 S 59,4 9$H 82'1 2 $H4 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 YTD 5/31/2014 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 �cati�y F,ti000 A FatiooF'k� qktioo� '�'tioyo New Commercial - Square Footage FROM Nonresidential amIwNew Co mmercia I -Square Footage ��vOy� tia�O Total in 2013 Total in 2023 Difference Feet 9,965,834 1 • Wide variety of project sizes and dollar values. • Fee calculations are complex, need to know what the project is to calculate the fee. • Many types of City revenue collected from commercial projects are less than those collected from residential development. — 40% of all connection fees — Tax Year 2013 32% of property tax revenue — Average 43% of Building Permit revenue since FY2005 $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 rrr rrr 12 City of Meridian General Fund Revenue Budget Projected Budget Actual FY2015 FY2014 FY2014 FY2013 ■ Interest General Fees/Misc ■ Franchise Fees ■ Impact Fees - Government Revenue Sharing • Development Services ■ Property Tax 1 b City of Meridian General Fund FY2015 Revenue Budget $39,684,812 General Fees/Misc Franchise Fee 4% 3% — i Impact Fees — ' A 5% Government Revenue Sharing 16% Developmi Services 11% —interest 0% Property Tax Revenue Calculation FY2015 Computation of 3% budget increase highest of last 3 years budget multiply by 3% New Construction/Annex 2013 new construction 2013 annexation Prior Year Levy 0.004258855 new construction budget increase annexation budget increase foregone Maximum Property Tax Taxable Value Levy Rate $385,420,3201 $13,038,540 $1,641,449 $55,529 $24,363,256 $6,213,277,313 0.00392116 FY2014 Computation of 3% budget increase highest of last 3 years budget multiply by 3% New Construction/Annex 2013 new construction 2013 annexation Prior Year Levy 0.004550974 new construction budget increase annexation budget increase roregone Maximum Property Tax Taxable Value Rate $209,176,744 $3,984,200 $951,958 $18,132 $22,006,095 $5,167,138,662 0.004258855 Levy Rate Take 3% Revenue No 3% Revenue Difference FY2015 FY2015 0.00391783 0.003811 FY2016 0.00010659 $790 FY2016 0.00388302 0.003673 $755 0.00020959 FY2018 FY2017 0.00381603 0.003510 FY2019 0.00030616 $682 FY2018 0.00363900 0.003254 $3,746 0.00038524 FY2019 0.00365262 0.003173 0.00047965 Levy Rate Impacts Meridian Property Tax - $300,000 Home No change in home value or exemption Average Meridian Residential Listing - $300,000 June 18th, 2014 Homeowner Exemption - $85,000 Take 3% Revenue No 3% Revenue Difference FY2015 $842 $819 $23 FY2016 $835 $790 $45 FY2017 $820 $755 $66 FY2018 $782 $700 $83 FY2019 $785 $682 $103 $4,065 $3,746 $320 Average Meridian Residential Listing - $300,000 June 18th, 2014 Homeowner Exemption - $85,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 Residential City of Meridian Property Tax Payments 2006 2007 2008 2009 2010 2011 2012 2013 —P—South Meridian Home rNorth Meridian Home Central Meridian HometGolf Course Home Historical Levy Rates 2006 2007 2008 2009 2010 2011 2012 2013 moomMeridian Levy Rate tTotal Ada County Levy • The levy rate is one small element of a property tax bill. • Legislative Exemptions Reduce of Shift Tax between residential and commercial — HB 645 Speculative land — HB 519 Site Improvements — Homeowners — Personal Property — Industry Specific • Other Taxing Entities • Taxable Value • Exemptions set by legislature • FY2011 and FY2012 Meridian did not take the allowable levy increase— some property taxes still increased $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 12 General Fund Undesignated Fund Balance Year -End Audited Financial Statements Estimated FY2013 FY2012 FY2011 FY2010 FY2014 ■ Operating Reserve ■ Undesignated Fund Balance GENERAL FUND - FUND BALANCE Estimated Undesignated Fund Balance 9/30/2014 FY2014 Admendments Undesignated Fund Balance 9/30/2014 CAPITAL IMPROVEMENT FUND BALANCE Undesignated Fund Balance 9/30/2014 FY2009 $3,760,207 $2,159,382 $1,600,825 378 ■ Need fund balance to cover routine replacements and maintenance. ■ Virtually all General Fund assets constructed with a 15 year period. ■ Buildings - $35 million book value ■ Improvements - $30.5 million book value ■ Equipment - $11,594,074 book value depreciated value - $4,216,594 — 64% depreciated ■ Increase in Police and Fire Employees increase vehicles ■ "Amendment Habit" - things come up, opportunities not foreseen in advance. ■ Property Tax revenue lags almost two years behind. ■ Development is up and down, have to be prepared for the down. Enterprise Fund Revenue Sources ■ All fee based — designed to cover; ■ Operating costs of getting services to and from customer on a daily basis. ■ Replace and maintain existing system as needed. ■ Expand infrastructure and make treatment and delivery improvements. ■ Fees can be structured in a variety of ways to capture needed costs but care must be taken to not capture a particular cost in more than one fee. $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 Water and Sewer Sales FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 Budget Budget FY2014 FY2015 Water Sales Sewer Sales • The "bread and butter" of the utility system. • Sewer sales moving with account growth — about 3% annually • Water sales have been moving ahead of account growth — variable — the hotter the better — plus there are sprinkler only accounts, hydrants etc. Sewer Sales and # of Accounts 30,000 $14,000,000 29,000 $12,000,000 28,000 $10,oBB,000 27,000 s8,0o0.00o 26,000 $6,000,000 25,000 24,000 $4,000,000 23,000 $2,000,000 22,000 $0 FY2008 FY2009 FY2010 Fn011 FY2012 FY2013 Budget FY2014 Sewer Sales ammAaounts Water Sales and # of Accounts $8,000,000 30,000 $7,000000 29,000 $6,000,aoo 28,000 $5,0B0,BBo 27,000 $4,000.000 $3,000,000 26,000 Water Sales 25,000 —Aaounts $2,000.aoa $1.00x000 24,000 $0 23,000 Sewer Sales and # of Accounts 30,000 $14,000,000 29,000 $12,000,000 28,000 $10,oBB,000 27,000 s8,0o0.00o 26,000 $6,000,000 25,000 24,000 $4,000,000 23,000 $2,000,000 22,000 $0 FY2008 FY2009 FY2010 Fn011 FY2012 FY2013 Budget FY2014 Sewer Sales ammAaounts $6,0oo,0oc $s,000,00C $4,000,00[ $3,000,00[ $2,000,00[ $1,000,00[ $C Connection Fees Utility Connection Fee History • Paid when property is "connected" to the water/sewer system and can receive service. • About 85% of total collections are from residential connections. • About 60% of total collections are for WWTP connections. $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 �2 Use for capital replacement and Enterprise Fund improvement/growth/technology Year -End Audited Financial Statements Est FY2014 FY2013 FY2012 FY2011 FY2010 i Unreserved fund Balance i Operating/Emergency Reserve ■ At 9/30/2013 ■ Construction in Progress - $10,077,101 ■ Other Assets (Buildings, lines, machinery and equipment) ■ Cost - $233,109,904 ■ Accumulated Depreciation - $59,228,153 ■ 25% Depreciated MIERIDIANk,, Public IDAHO Works Department 2015 Budget Proposal July 9, 2014 The mission of the Public Works Department is to anticipate, plan and provide exemplary public services and facilities that support the needs of our growing community in an efficient, customer -focused and financially responsible manner. Overview Enterprise Fund — Basics & Peculiarities I Departmental Accomplishments & Challenges Budget Development Process: Background & Approach 6 FY2015 Proposed Base Budget IFY2015 Enhancements • PW Admin Division I • Wastewater Division • Water Division Questions & Discussion Funding Source • Property Tax Payers • Users of Fee-based Services • Developers, Contractors • State of Idaho • Utilities • Granting Organizations Funds • Property Taxes • State Revenue Sharing • Fees — Assessments, Impact, Franchise • Licenses & Permit Fees • Grants • Usage Fees — Park & Rec Fees • School Resource Revenue • Planning Filing Fees • Fines & Forfeitures • Interest Earnings Use • Police, Fire • HR, Legal, IT, Finance • Parks & Recreation • Community Development • City Infrastructure • Community Programs • Capital Projects IRVAZI■EdIIra11111111»L-raidIIIts Funding Source • Rate Payers — Water • Rate Payers — Sewer • Developers, Contractors • Republic Waste Management • Banks • Granting Organizations Funds • Base Fees — Water • Base Fees — Sewer • Use Fees — Water • Use Fees — Wastewater • Reimbursements • Assessments — Residential, Commercial • Garbage — Admin Fee Revenue • Donated Capital • Interest Earnings Use • Infrastructure — Water, Sewer, Reclaimed Water • Environmental Programs • PW Administration/Engineering • Public Outreach • Water, Sewer Billing • Interfund Transfers Accomplishments Public Works Accomplishments YTD Financial • Rate Model Modifications ■ FY2015 Budget Operations ■ Asset Management ■ Water Quality ■ Meridian Heights Water & Sewer District ■ Wastewater Treatment Plant Improvements Public Works Accomplishments YTD Strategy ■ Proactive & Pre-Emptive Approach — Legislative, Irrigation Issues, NPDES, TMDL, Landfill, etc. • Project Management — Process, Schedules, Budgets Customers ■ Pollution Prevention Programs — Automotive, Printers, Dental Offices ■ Public Outreach — Animations: Water, Solid Waste & Recycling ■ Water Quality Management — Treatment, Operational Oversight Employees ■ Employee Satisfaction Survey ■ Compensation Program ■ Skills Assessment ■ Tailored Training ■ Safety Training • On -Boarding Plans Challenges Public Works Challenges Financial ■ Utility Rate Model ■ NPDES Implementation ■ Utility Billing Software — Cost, Performance, Integration ■ Future Funding of Capital Infrastructure & Replacements Operations ■ Managing Growth ■ NPDES Permit ■ SCADA System Connectivity ■ Asset Management ■ Inventory Management Public Works Challenges Customer Satisfaction ■ Iron & Manganese Control ■ Wastewater Treatment Plant Odor Control Strategy ■ Continued Legislative Presence ■ Strategic Plan Update ■ Departmental Accreditation Employees ■ Staffing — Levels, Recruitment, Retention ■ Workforce Development — Succession Planning Budget Development Process I Budget Calendar Released Departmental Reviews of Base Budget Base Budget Review with Finance, Mayor, Council Liaison Finance Releases Proposed Final Base Budget to Division Managers Capital Replacements/ Enhancements Submitted to Business Operations for Review Enhancement Review with Department Managers and Business Operations Enhancement Review with Council Liaison Enhancements Submitted to Finance Prepare Budget Presentation Budget Hearing with City Council Approved Budget Released Working the Plans City Comprehensive Public Works Plan Department Mission & Vision Council Strategic Focus Areas Facility Plans Public Works Strategic ) \ Plan 5-YearCIP Community Input Operations Plan Annual Project & Program Appropriations Master Plans Budget Prioritization We incorporated the followinq I And Approach principles into the preparation of our FY2015 Budget: • Meet Current Regulatory and Safety Requirements • Preserve Product and Service Quality, Area and Delivery Levels • Adequately Protect and Maintain Infrastructure • Follow the Plan(s): Measured Expansion of Assets and Infrastructure • Use "Just -in -Time" Capital Financing Approach • Utilize Technological Resources • Sufficiently Fund and Deploy Workforce Training Strategy • Incorporate Performance -Based Budgeting Principles • Maximize Operational Efficiencies and Cost Avoidance Opportunities • Ask For Only What is Needed • Empower Our Budget Stewards Budget Strategy • Proposed Budget Consistent with Rate Model • Continue with PAYGo Strategy 4J • Accommodates Impending Regulatory Requirements r. ■� • Aggressive Management of Budget Process d • Emphasis on Stabilizing O & M Costs • Continued Focus on Improving Execution Rates in Operations & Construction • Cost Avoidance Focused • Consideration for Depreciation Eligible Assets 9 Focus on Continuous Process Improvement (CPI) Mayor & Council Liaison ■ Mayor Tammy de Weerd ■ Councilman Joe Borton Finance Team ■ Stacy Kilchenmann, CFO ■ Reta Cunningham • Todd Lavoie PW Executive Team ■ Tom Barry, PW Director ■ John McCormick, Deputy Director ■ Dale Bolthouse, Deputy Director, Ops. ■ Mike Pepin, Business Ops. Manager Assembly and Vetting PW SLT & Key Staff ■ Warren Stewart ■ Dennis Teller ■ Tracy Crane ■ Mollie Mangerich ■ Max Jensen ■ Clint Dolsby ■ Kyle Radek ■ Amber Christofferson ■ David Allison ■ Laurelei McVey ■ Clint Worthington FY15 Proposed Budget Enterprise Fund POM Expenses & Enhancements FY2014 Adopted Budget vs. FY2015 Proposed Budget FY2014 Adopted $18,168,121 ■ Replacements $11,806,991 L$124,800 Budget: $30,099,912 # of accounts: 29,663 Enhancements FY2015 Proposed $14,404,908 $13,304,949 x$169,058 Budget: $27,878,915 Est. # of accounts: 30,553 POM Replacements Enhancements LEI Budget Detail Enhancements FY2010 — FY2015 (proposed) $20,000,000 $18,000,000 $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 22 33 36 33 38 43 $6,000,000 $4,000,000 $2,000,000 $0 FY10 FY 11 FY12 FY 13 FY14 I FY15 ants $8,261,371 1 $8,216,369 1 X7,732,568 1 X15,631,000 1 118,168,121 1 X14,404, $30,000,000 $25,000,000 $20,000,000 ■ - $15,000,000 $10,000,000 71 $5,000,000 Enterprise Fund Revenue FY2010 — FY2015 (proposed) $0 FY10 Actual FY11 Actual FY12 Actual FY13 Actual FY14 Projected FY15 Proposed Revenue* $20,432,038 $22,225,170 $25,479,783 $27,413,171 $26,696,531 $26,694,886 Assessments $2,267,558 $2,163,158 $4,582,068 $5,765,329 $6,060,483 $5,363,260 Utility Sales $16,827,044 $18,669,099 $19,401,864 $20,034,999 $20,636,049 $21,331,626 *Total Revenue for Enterprise Fund does not include non-cash donations, includes all other revenue sources FY15 Enhancements PW Admin Division and Business Operations Env/PW Admin Divisions Enhancement Summary Enhancement Description Proposed $$ Asset Management Analyst $78,094 Rate Model Upgrade $150o,000 $228,094 Asset Management Analyst - $78,094 (fully loaded) This enhancement is to add an Asset Management Analyst position to assist with optimizing the asset management program. • Provide necessary resources to adequately assist with the asset system design, operations and program development • Help refine processes and improve system efficiencies • Offer improved accessibility to staff for troubleshooting assistance • Perform data management, reporting and QAQC services Rate Model Upgrade - $150,000 This enhancement is to provide funding to solicit and hire a consultant to evaluate the Public Works Rate Model and develop/find a more dynamic, robust and longer -sighted tool for rate modeling. • Desired tool should include: stronger analytic abilities, dynamic settings to accommodate economic, operational and regulatory changes, dashboard capability and 10 -year forecasting Questions &Comments Utility Operations: Wastewater &Water Wastewater Division Wastewater Division Enhancement Summary Enhancement Description Proposed $$ NPDES Permit Compliance Plan $925,000 Financial Plan $100,000 Side Stream Nitrogen Removal/Centrate Equalization Tank $450,000 QAQC Coordinator $76,130 Laboratory Analyst III $70,670 Laboratory Analyst I $60,965 Operator II $64,028 Operator I $59,176 CCTV Van, Easement Cleaner and Collections Technicians $457,664 Ultraviolet Disinfection Improvements $2,000,000 Wastewater Facility Maintenance Shop $2,166,850 SCADA System Upgrades $250,000 Plant PLC Replacements $950,000 Sewer Main Replacements $1,050,000 Sewer Line Extensions $250,000 Headworks Upgrades $500,000 Site Specific Aquifer Recharge Study $300,000 Generator Loadbanks $80,000 WWTP Spare Parts, Additional Tools and Safety Equipment $50,000 Interpretive Center $175,000 $10,035,483 National Pollutant Discharge Elimination System (NPDES) Permit Compliance Plan - $925,000 This enhancement is to tailor the Wastewater Treatment Plant Facility Plan to match the new NPDES Permit requirements when they are issued. Included in this enhancement: • Phase 1 of a Low Phosphorus Plan • Phosphorus Removal Optimization Study • Tertiary Filter Decision Making Study • Wastewater Treatment Plant Site Master Plan • Capacity/Growth Considerations Financial Evaluation/Plan - $100,000 This enhancement is to fund an evaluation of the Public Works Department financials. • Evaluate financials prior to substantial capital investments in Phases 1 and 2 of the NPDES permit implementation plan • Review of current rates/fees and available cash • Determine if rate/fee increases are required to fund the capital program to comply with NPDES permit limits k, Side Stream Nitrogen Removal/Centrate Equalization Tank - $450,000 This enhancement is to fund the first year of a two-year project to reduce the mass of ammonia -nitrogen internally returned to the plant headworks, as well as equalize the return flow stream. • Increased ammonia -nitrogen removal efficiencies • Reduce the amount of side stream loading • Alternative to more costly plant expansion r • Make reclaimed water production more relit Laboratory Positions (all fully loaded costs) The following enhancements are to add laboratory positions to help ensure compliance with the NPDES, Reclaimed Water and Air Permit requirements. The positions will also enable a 7 day/week laboratory operation and compliance with rigid sampling time constraints. QAQC Coordinator - $76,130 • Verification and proofing of analytical calculations and results • Assist the Laboratory Supervisor in generating required EPA and IDEQ reports • Coordinate proper sampling and shipment of samples for outside analysis • Maintain the Laboratory Information Management System (LIMS) Laboratory Analyst III - $70,670 • Perform sample analysis using advanced instrumentation • Maximize up -time of automated online monitoring equipment • Complete laboratory testing to assist in discovery of alternative treatment methods Laboratory Analyst I - $60,965 • Assist with completion of workload associated with process samples • Perform required surface water monitoring • Ensure 7 day/week testing is accomplished Operator Positions (all fully loaded costs) The following enhancements are to add operator positions to help ensure compliance with the NPDES permit 24 hours a day, 7 days per week. Both positions will perform skilled work in the operation of the City's Wastewater Treatment Plant. Operator II - $64,028 Operator I - $59,176 CCTV Van and Collections Technicians (Part 1) - $332,664 (positions fully loaded) The first part of this enhancement is to fund the purchase of a closed circuit television (CCTV) van and to hire two full-time staff (Collection System Technician I and Collection System Technician II) to operate the equipment. • Allow the Wastewater Division to get back on schedule and meet established goals • Better response to customer service requests and internal City CCTV requests • Accommodate sewer infrastructure growth ��E IDIANx CCTV Inspected vs Scheduled Schedule/Month: 35,200 (ft) Actual Average/Month: 26,360 (ft) 450 400 350 300 y 250 c 200 150 100 50 0 i JurF13 Jul Aug Sep Oct Nov Dec Jan -14 Feb Mar Apr May Total Ft. TV'd Scheduled s � L ray � I I �s Easement Cleaner and CCTV Camera and Transport Equipment Upgrades (Part 2) - $125,000 The second part of this enhancement is to fund the purchase of a CCTV camera and transporter equipment upgrades and a sewer easement cleaner. • Equipment upgrades will allow for improved technology, advanced imaging quality and improved system reliability • Sewer easement cleaner will: • Allow for cleaning and maintenance of sewer lines located in difficult to access easements • Provide rapid emergency backup response • Enable utilization around the WWTP to remove line blockages easily and efficiently _4 ,t 2013 r -I Ultraviolet Disinfection Improvements - $21,0001,000 This enhancement is the second part of a three-year project to expand the UV disinfection system to accommodate future flow and load conditions as the City grows. • Increased disinfection capacity will ensure required UV dose is delivered while maintaining compliance with NPDES permit requirements • Allow for maintenance of one channel without diminishing ability to treat peak flow • Simplify the maintenance of the UV system I Mark, 6, r Wastewater Facility Maintenance Shop - $2,166,850 This enhancement is for the construction of the Wastewater Facility maintenance building. • Provide facility for existing and future infrastructure equipment repair and maintenance • Create space required to safely maintain and repair critical equipment • Enable efficient repair completion, resulting in a reduction in equipment downtime, increase in staff productivity and decrease in outsourcing T.nk.2 Task /2 Tank Yl InOuent T.1.154279M G.11.n, Elll..nl Tm.l l&89110 GA.. Y.nk.l IYMM Ws101W •CI IYM • 80aY1» Ib.qu!-0.51meE cr-T80 nM n.M 1»> 9aTi» 1 Ell1 T.k I. u 2 En� T�N.OIy I t . )EnA Tvl 1010. .EKI T.b , l07d. Fllla Seeup T.n E. kan EYo wrosl.co� Plant PLC Replacements - $950,000 This enhancement is to fund a project to upgrade programmable logic controllers (PLCs) that make up the control network within the Wastewater Treatment Plant. The enhancement also provides funding to complete fiber connectivity between Water, Wastewater and City Hall • Includes: design, purchase, programming a and installation • Will allow for full integration in the SCADA system with updated technology ' _ I:,li1111„11.6!1►,�0 lop�U/'�11�1''111�1111' fru n► �o,►►■i,u,{, MilAral III mail, I II�6=z V� I Sewer Main Replacements - $1,050,000 This enhancement is to fund the design and construction of sewer infrastructure replacements for aging infrastructure. • Reduce collection system failure rates, infiltration and inflow and improve collection system capacity Sewer Line Extensions - $250,000 This enhancement is to fund the building and improvement of infrastructure in the sewer collection system. • Provide capital funding for extension projects done in coordination with ACHD • Reduce costs associated with pipe installation by removing need to restore pavement and pay for traffic control Wastewater Treatment Plant Headworks Upgrades - $500,000 This enhancement is part one of a three-year project to fund design and construction of improvements to the headworks that includes influent flow monitoring, influent pumping, grit removal capacity, screening upgrades and odor control. • Increase firm capacity • Provide better screening upstream of future nutrient removal treatment processes 1 MW Site Specific Aquifer Recharge Study - $300,000 This enhancement is to fund the second year of a two-year project to provide a comprehensive aquifer recharge study to analyze the viability of aquifer recharge as a means of utilizing wastewater effluent. • Evaluate several methods of aquifer recharge • Provide recommendations for moving forward with a specific project type and location Generator Loadbanks - $80,000 This enhancement is to fund the design and installation of loadbank equipment for the plant generators as well as both Black Cat Lift Stations. • Meet testing requirements and allow continued operation without monthly shut down and transfer of plant electrical loads • Eliminate the need for annual testing • Comply with the National Fire Protection Association 110 testing requirements • Avoids power surges to Plant PLCs and minimizes plant interruption Spare Parts, Tools and Safety Equipment - $50,000 This enhancement is to purchase critical pieces of equipment and inventory required to ensure continuous operation of the Wastewater Treatment Plant. • Acquisition of additional tools/equipment to perform more in-house maintenance and predictive maintenance • Shorter down time on critical equipment repairs due to on site acquisition of necessary inventory and tools Wastewater Resource Recover Facility Interpretive Center - $175,000 To build understanding and support of utility operations through educational and outreach of the public Educate citizens/rate payers and public about treatment processes, plant operations and regulatory treatment requirements Develop and create partnerships with educators from local middle schools and high schools Showcase current and future wastewater treatment technologies Utilize as a recruitment tool 19001950 1800-18 .� Y,..�. zero relevance too waw'..,. e,.,�: >."°,.•.w�r e... m...,w «....r..n Questions &Comments Water Division Enhancement Description Source Water Protection Program Lead Operator SCADA System Upgrades VGB Mobile Meter Reading Unit Peristaltic Chlorine Injection Pumps Condition Based Monitoring Professional Services/IPS Integration Well 16B & C Pumping Facilities Waterline Extensions Water Admin Phone System Upgrades Valve Lid Replacements Water Main Replacement Well 19 Water Treatment Well 22 and Well 18 Water Treatment Well 27 Water Treatment Water Admin AV and WiFi Upgrades Well 11 Building Mainline Repair Equipment Well 14 Building Upgrades Well 29 Well 30 Water Division Enhancement Summary Proposed $$ $60,000 $121,531 $550,000 $35,000 $50,000 $198,800 $70,000 $320,000 $500,000 $27,000 $125,000 $300,000 $400,000 $100,000 $600,000 $24,000 $25,000 $25,000 $50,000 $350,000 $210,000 $4,141,331 Source Water Protection Program - $60,000 (ongoing) This enhancement addresses several activities necessary to ensure protection of current and future water rights and supply. Request is to add this to the base budget as an ongoing expense. • Protect current water rights • Plan for the acquisition of future water sources and rights • Source Water Protection • Coordination with DEQ regarding system testing requirements and drinking water rules • Measure and document water levels in observation and supply wells ' . 4� I Lead Operator - $121,531 This enhancement is to add a Lead Operator position to the Water Division and to purchase a vehicle for the position. • Position will oversee, manage and assist with distribution system maintenance and repair activities • Position provides staffing needed for a dedicated maintenance crew Supervisory Control and Data Acquisition (SCADA) System Upgrades - $550,000 This enhancement is for the purchase and installation of upgrades to the SCADA system at base stations and remote terminals, including wells, storage facilities and Pressure Reducing Valve (PRV) sites. • Increase speed, reliability and monitoring/ control efficiency of water facilities • Enable system optimization for water quality, power consumption and other parameters • Enhance reporting capabilities for regulatory or planning purposes VGB Mobile Meter Reading Unit - $35,000 This enhancement is to fund the purchase of a Mobile Vehicle Gateway Base Station (VGB) unit. • Provides a link between current and future meter reading technology • Enables development of fixed base system • Provides redundant capabilities for future systems Peristaltic Chlorine Injection Pumps - $50,000 This enhancement is to fund the purchase and installation of new "peristaltic" chlorine injection pumps to replace existing pumps. • More reliable with lower life -cycle cost • Versatile and provide monitoring and alarm capabilities • Compatible with SCADA system Condition Based Monitoring - $198,800 This enhancement is to fund the purchase of Infor Public Sector (IPS - formerly Hansen) Condition Based Monitoring software to incorporate data collected from SCADA into IPS. • Real-time data collection • Reduction of manual site readings • Helps predict and alert operators to potential critical equipment failures • Automatically tracks and schedules work orders for equipment maintenance Professional Services/IPS Integration - $70,000 This enhancement is to fund the continuation of Phase 2 and start of Phase 3 project design and development assistance to continue incorporation of the City's asset management system (IPS) into the Water Division. • Increase efficiency and robustness of the asset management system • Fully integrate an asset management system in Phase 2 operational areas • Complete the development of IPS software and improve its utilization Well 16B & C Pumping Facilities - $3201,000 This enhancement is to fund construction of pumping facilities for new production wells 16B and 16C. • Project includes: water main, pumps, pump column, motor, Variable Frequency Drives, electronic controls, SCADA equipment, HVAC upgrades, building modifications and site improvements Waterline Extensions - $500,000 This enhancement is to fund the design and construction of waterline extension projects to expand and improve the distribution system. • Includes design and construction of flush lines to allow Water Operators to flush water out of the system into creeks and canals • Improve infrastructure and system robustness Water Administration Building Phone System Upgrades - $27,000 This enhancement is to fund the purchase and installation of a replacement phone system for the Water Division. • Improved customer service through enhanced options and flexibility Valve Lid Replacements - $125,000 This enhancement is to fund the purchase and installation of plastic water valve lids. • Replace cast-iron lids, reducing damage to vehicles and safety hazards and work order demands for the Water Division staff • Keep debris out of valve cans allowing7�;_ for faster access in emergencies Water Main Replacement - $300,000 This enhancement is to fund the design and construction of projects to replace old, leaking, undersized water mains or water mains made of substandard materials. • Ensure water loss due to leakage is kept to a minimum and threat of main breaks is reduced • Provide for an uninterrupted water supply to customers and adequate fire flows • Enhance and protect level of water quality Water Treatment • Improve water quality supplied by the wells to the City's customers by removal of Iron and Manganese from supply water • Improve customer satisfaction and reduce customer complaints regarding brown water Well 19 Water Treatment - $4001,000 This enhancement is to fund year two of a two-year project for design, equipment procurement and construction of a water supply treatment facility. Well 27 Water Treatment - $600,000 This enhancement is to fund year one of a two-year project for the design, equipment procurement and construction of a water supply treatment facility. Well 22 and Well 18 Water Treatment - $100,000 This enhancement is to fund the design and execution of pilot testing at Wells 22 and 18 to determine feasibility of source water treatment through "aquifer conditioning." Water Admin " and WiFi Upgrades - $24,000 This enhancement is to fund the purchase and installation of an audio-visual system for the Water Division's administrative conference/training room and WiFi for the Water admin building. • Improve operational use, visibility and system flexibility Mainline Repair Equipment - $25,000 This enhancement is to fund the purchase of tools and equipment required to repair and replace water distribution infrastructure. • Enables staff to make emergency repairs as needed and efficiently perform routine maintenance and replacement activities Well 11 Building - $25,000 This enhancement is to fund the first year of a multi-year project to construct a new building or upgrade the existing building at Well 11. • Year one of project to conduct a feasibility study to determine available options for a new or upgraded pump house Well 14 Building Upgrades - $50,000 This enhancement is to fund the design and construction of upgrades to the existing Well 14 building. • Removal of obsolete booster station piping and appurtenances • Provide a southern logistics site for storing parts and equipment Wells • Provide the next drinking water sources for the City • Includes: test well, production well and pumping facilities Well 29 - $350,000 This enhancement is to fund the second year of a three-year project for design and construction of Well 29. Well 30 - $2101,000 This enhancement is to fund the first year of a three-year project for design and construction of Well 30. Questions &Discussion Meridian Police Department FY 15 Budget Presentation Chief Jeff A. Lavey �WENDIAN -- Mission Statement To provide the highest quality service, in partnership with our community, to preserve and protect life and property through education, prevention and enforcement. �WENDIAN -- Meridian Fire 2015 Budget Presentation r:m Coverage Area • Response Area- 54 Square Miles — City response area- 26 Square Miles • 2013 City Incident Responses - 4281 • 2013 Rural District Incident Responses -314 • 2013 Mutual/Automatic Aid Given- 801 • 2013 Total Calls for service - 5396 — Does not include calls not logged by dispatch (friendly calls for service) fppt.com Organization- Great people making great things happen Administrative i eam riesoonsibilitiF • Perry Palmer— Inspections, Investigations, Public Education, Fleet and Facilities Support, Prevention Community Development, Fire Code ❖ Planning, Emergency • Chris Am e n n- Management/Prepardeness, Policies, Grievances, Performance Reviews, IT/RMS, Planning/Preparedness Deployment/Levels of Service, Accreditation, CIP • Dave Jones— Line personnel/Shift Commanders, EMS JPA, Special Operations, Safety and Fitness, Operations Fire Department Equipment, PPE, Mutual/Automatic Aid, Deployment, Special • Judy Gerhart— Events :• Budgeting/Accounting, Payables, Invoicing, Administration Supplies, Website/Outreach, Vendor contract management, Department reports, Project tracking/change management, Travel, Rural Fire District administrative support, Liaison to HR and Finance fppt com Organization- Great people making great things happen • support i eam — Kevin Fedrizzi- Training — Pam Orr- Public Education — Kenny Bowers- Fire Inspector —Christi Boucher- Admin 1 — Emily Stroud- Records Clerk Organization Chart • Operations ❖Shift Command Supervisors- Ken Welborn, Blake Campbell, Rod Shaul ❖Station Captains- 18 ❖Station Engineers- 18 ❖Station Firefighters- 21 ❖Currently have 1 vacant FF position; job recently offered. Future vacancy in September; possibility of additional vacancies in next 6 months. ❖ Recent departures: Bill Johnson- Accepted Assistant Chief Position with Depoe Bay FD; Ricky Williams- returned to Arizona; September Katie Mallaburn- accepted entry into UofW Physician Assistant Program Progress on Approved FY14 Requests FY2014 Enhancement Update Records Clerk Position Emily Stroud Hired November 2013 Recent NNU Graduate a 9 FY2014 Enhancement Update Portable APX Radios •Cost negotiations (4 months) completed *Using regional Grant monies to supplement enhancement, will allow for purchase of 21 units — - _F one for EVERY crew member " was 9 (original ) *Grant approved and signed, order to be placed within the next month fppt.Com FY2014 Enhancement Update • CPR/AED Program- Currently holding CPR classes for City employees • Cardiac Monitor replacements/purchase- bought, trained on, and deployed • Station Securitv Card ent system- currently being installed • Apparatus Wireless Headsets- two brands evaluated; will be purchased within next 30 days. fppt. conn "Planning" to build a budget • Plans that the Fire Department operates from to maintain the department as well as strategically plan for growth based on demand — Fire Department 2011-2016 Strategic Plan — City of Meridian Capital Improvement Plan — Apparatus Replacement Plan — Station maintenance and replacement Plan — Annual comprehensive Training Plan — Comprehensive Fire Inspection Plan ire Department Strategic Plan Meridian Fire Department, Idaho ' , • Meridian Fire Department, Idaho 2011-2016 Strategic Plan 2011-2016 Strategic Plan ■ Developed and finalized in June 2011 ■ Presented to and supported by City Council on November 91" 2011 ■ To date, have fully met 23 of 39 initiatives ■ To date, have partially met 10 of 39 initiatives ■ To date, 6 of 39 initiatives have yet to begin ■ Ambitious plan that the Department is meeting ■ Councilman Hoaglun "..I have no doubt you guys will be achieving these, so I wish you well. Because it is ambitious" ■ Councilman Rountree "..done a great job putting together what I see as a doable and reasonable plan.... if it doesn't stretch you somewhat it's not a good plan and I think this will stretch you" fppt.com Annual Comprehensive Training Plan ■ Training to meet requirements and/or standards as defined by: ■ State EMS- medical ■ NFPA- suppression, rescue, safety, response, prevention ■ NIMS- incident and emergency management • State Fire Marshall/IFC- inspections ■ IAAI- fire investigations ■ ISO- training requirements for classification • OSHA- federal safety requirements ■ NWCG- wildland firefighting ■ FSRS- Fire suppression rating schedule ■ City of Meridian specific training ■ Each employee receives approximately 366 hours of training annually to meet the above requirements IPPt.(c0111 F�U Comprehensive and layered Fire Inspection Plan ■ PRIORITY 1- Annual Inspections on occupancy types: schools, hospitals, hotels, movie theatres, apartment complexes, any occupancy that serves alcohol (restaurants, grocery stores, etc.). Approximately130 total and growing • Performed by Fire Marshall and Fire Inspector • Schools = 120 hours INITIAL inspection x 2 = 240 man hours • Others = 260 hours INITIAL inspection x 2 = 520 man hours • Currently meeting goals for these occupancies Other Annual Inspections: • Fire Works Stands- done by Fire Marshall and Fire Inspector • 23 per year- 1 hour each Inspection with 30 minutes follow up inspection = 69 man hours fppt.conn • PRIORITY 2- Inspections every other year on occupancy types: churches, high value (Lowe's, Home Depot), large gathering places. Approximately 50 total and growing — Performed primarily by Fire Inspector — Typically take 2-3 hours to inspect = 125 man hours — Currently meeting goals for these occupancies • PRIORITY 3- Inspections every 3rd year on occupancy types: All other non-residential occupancy types. Approximately 2500 and growing — Performed by Fire Inspector — Currently not able to meet goals for these occupancy types Finding solutions • Full Time Fire Inspector — Need identified in CIP and Strategic Plan last 4 years — Had been planned for an FY15 Enhancement request. — Department staff realignment allowed for position in FY14 with NO additional funding requested — Department used a business analytical approach to meet todays needs without adding burden to the City fppt.com Challenges Replacing an aging fleet ❖Critical "tool box" ❖Safety standards change ❖Historical 3% inflation cost per year ❖Findinq Solutions ****Working with Finance/Mayor to create long term funding plan ****Looking at Alternative Response through EMS JPA ****Looking at Alternative Service delivery models (Quick Response) FY 2015 Budget Requests FY2015 Personnel Request P/T Public Education Assistant Cost- $31,883 ■ Growing number of public education requests (requests have tripled since 2005) • Per recent City Survey, public desires more Fire Public Education fppt.com Benchmarks ■ Allows the Department to maintain current level of service to the community by continuing to enhance safety through prevention ■ Meets MFD Strategic Plan Initiative 6D ■ Allow the Pub. Education Specialist (Pam) to explore additional offerings the community has been requesting ■ Addresses City Survey identified need Mobile Fire Inspection Reporting Software Program Cost= $18,280 *Ability to input inspection information while in the field, keeping database current *Ability to view past inspections with business owner *Efficiency in time and accuracy gained through elimination of redundant entries *Old system (Firehouse) is poorly supported and not IT friendly 1W fppt.com Benchmarks ■ Meets MFD Strategic Plan Initiatives 8-A and 8-H ■ Fully supported by IT- Web Based App; decreases City liability ■ Best of breed software vs. `packaged system' (undesirable) ■ Open platform that talks to other City systems ShoreTel Phones All Fire Stations Cost= $31,000 Need • Current phones are outdated and in need of replacement • Current phones no longer supported • Will standardize phone system throughout City- request by IT fppt_CoOnl Benchmarks ■ Standardization of phones throughout the City will aid I.T. in the management and maintenance of the phone system ■ Allows for teleconferencing (currently no capability) SCBA Respiratory Fit Tester Cost= $10,600 Need • Have been borrowing testing equipment from other Fire Departments • Not able to provide timely & efficient tests of respiratory protection throughout the year due to non-availability of borrowed equipment • Testing is required for SCBA placement fppt.com Benchmarks • Meets MFD Strategic Plan Initiative 3A • Meet OSHA regulation for testing & maintenance of respiratory protection • Provide required fit tests in timely & efficient manner • Maintain Operational readiness and effectiveness RSSURIRG 1E S�FETV _ OF THOSE WH U1 LIUES r ( 7, Aw #.e G Turnout Gear PPE Washers Cost= $25,710 16- Need • Immediate cleaning of PPE following incidents to remove soot & toxic residue in a specialty extractor • Currently have only 2 washers for 5 stations • Currently crews have to travel out of their district to wash PPE • To meet NFPA, OSHA, and FEMSA standards • PPE is NOT allowed to be taken home and washed fppt.com Benchmarks • Clean PPE after EVERY exposure & increase longevity of PPE garments • Increase longevity of washers (from 10 to 15 years) • Meet NFPA 1851 for Care & Maintenance of PPE • Meet industry best practice • Eliminate unnecessary travel outside primary service district THANK -YOU FOR YOUR ftijrrt.RT 000000 fpDt Com Meridian Human Resources FY15 Budget Enhancement Patti Perkins, HR Director IAN IF91010oll.l very labor and time intensive Open Enrollment, and new employee benefits enrollment, is a manual process for employees, HR, and Payroll, requiring significant resources to administer each year Affordable Care Act is increasing the need to flex, change plans, provide more options requiring process automation HR's existing Sage/Abra HR system has modules available to streamline work and information processing Three specific modules will allow HR to be more efficient and accurate in benefits administration and allow employees greater access to their own relevant information Total cost plus maintenance is $48,263 one time cost; annual ongoing cost of $6000 maintenance beginning FY16 * Employee Self Service - allows employee access to Abra system to update personal information (addresses, etc.), view job history, performance reviews Benefits Enrollment- allows online benefits enrollment and updating of dependents, marital status; other features such as comparisons can be activated Benefits Messenger- automates sending benefits information to carriers uuces the UppUrtunity rOr errUrs Uy eiirninating the neeu w enter data numerous times Increases the speed at which information gets to the carriers; no more "lost" paper forms Increases the efficiency of HR, and others who use benefit data; HR can spend more time on value added services * Reduces the need for physical file space * Increases the ease of open enrollment for employees and HR Delays need to add to benefits administration staff as the City grows * Provides foundation for future automation of recruitment and manager self service modules City of Meridian FY2015 Revenue Forecast 25,000 20,000 15,000 10,000 5,000 0 First Step — Forecast New Construction Idaho Economic Forecast Housing Start Predictions �—Hou sing Starts Forecast 2008 Housing starts Forecast 2 -- -tarts Forecast 2010 tarts Forecast 2011 tarts Forecast 2012 tarts Forecast 2013 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 ■ New construction is the key to almost all municipal revenue sources. ■ Challenging ■ Always use a "grain of salt" Forecasts tend to be optimistic ■ Idaho specific sources include; ■ Idaho Division of Financial Management Economic Forecast ■ COMPASS ■ Idaho Department of Labor ■ Impact Idaho lousing Units Actual and Forecast Idaho Housing Starts May 2014 Idaho DFM Economic Forecast 25,000 Difference 20," 24,150 30,274 15,Wo lultifamily 2,994 lO,Wo S,OW 2,041 otal 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 ■ New construction is the key to almost all municipal revenue sources. ■ Challenging ■ Always use a "grain of salt" Forecasts tend to be optimistic ■ Idaho specific sources include; ■ Idaho Division of Financial Management Economic Forecast ■ COMPASS ■ Idaho Department of Labor ■ Impact Idaho lousing Units Total in 2013 Total in 2023 Difference ingleFamily 24,150 30,274 6,124 lultifamily 2,994 5,036 2,041 otal 27.144 35.310 8.165 1000 s00 6W 4W 200 0— Residential Building Permits Actual and Future Actual Actual Actual Actual Actual Actual Est. Est. Est. FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 Residential Building Permits Annual # Multi -Family Units Building Permits Sold FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 YTD Residential Development • Multi -family becoming more of a factor, national trend as paradigms of home ownership change. • As of June 30,2014 year to date residential permit sales are 20% less compared to same time last year. Forecast Residential Building Permits COMPASS 2023 700 600 500 400 300 200 100 0 Est. FY2018 Est. FY2019 Est. FY2020 Est. FY2021 Est. FY2022 Est. FY2023 Forecast Residential Building Permits Commercial Development Dollar Sales Commercial Building Permits Sold $1 316, 53 $1 371,178 S 33,2 7 S 79,4 4 51 118, 33 $1 138, 07 S 59,4 9$H 82'1 2 $H4 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 YTD 5/31/2014 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 �cati�y F,ti000 A FatiooF'k� qktioo� '�'tioyo New Commercial - Square Footage FROM Nonresidential amIwNew Co mmercia I -Square Footage ��vOy� tia�O Total in 2013 Total in 2023 Difference Feet 9,965,834 1 • Wide variety of project sizes and dollar values. • Fee calculations are complex, need to know what the project is to calculate the fee. • Many types of City revenue collected from commercial projects are less than those collected from residential development. — 40% of all connection fees — Tax Year 2013 32% of property tax revenue — Average 43% of Building Permit revenue since FY2005 $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 rrr rrr 12 City of Meridian General Fund Revenue Budget Projected Budget Actual FY2015 FY2014 FY2014 FY2013 ■ Interest General Fees/Misc ■ Franchise Fees ■ Impact Fees - Government Revenue Sharing • Development Services ■ Property Tax 1 b City of Meridian General Fund FY2015 Revenue Budget $39,684,812 General Fees/Misc Franchise Fee 4% 3% — i Impact Fees — ' A 5% Government Revenue Sharing 16% Developmi Services 11% —interest 0% Property Tax Revenue Calculation FY2015 Computation of 3% budget increase highest of last 3 years budget multiply by 3% New Construction/Annex 2013 new construction 2013 annexation Prior Year Levy 0.004258855 new construction budget increase annexation budget increase foregone Maximum Property Tax Taxable Value Levy Rate $385,420,3201 $13,038,540 $1,641,449 $55,529 $24,363,256 $6,213,277,313 0.00392116 FY2014 Computation of 3% budget increase highest of last 3 years budget multiply by 3% New Construction/Annex 2013 new construction 2013 annexation Prior Year Levy 0.004550974 new construction budget increase annexation budget increase roregone Maximum Property Tax Taxable Value Rate $209,176,744 $3,984,200 $951,958 $18,132 $22,006,095 $5,167,138,662 0.004258855 Levy Rate Take 3% Revenue No 3% Revenue Difference FY2015 FY2015 0.00391783 0.003811 FY2016 0.00010659 $790 FY2016 0.00388302 0.003673 $755 0.00020959 FY2018 FY2017 0.00381603 0.003510 FY2019 0.00030616 $682 FY2018 0.00363900 0.003254 $3,746 0.00038524 FY2019 0.00365262 0.003173 0.00047965 Levy Rate Impacts Meridian Property Tax - $300,000 Home No change in home value or exemption Average Meridian Residential Listing - $300,000 June 18th, 2014 Homeowner Exemption - $85,000 Take 3% Revenue No 3% Revenue Difference FY2015 $842 $819 $23 FY2016 $835 $790 $45 FY2017 $820 $755 $66 FY2018 $782 $700 $83 FY2019 $785 $682 $103 $4,065 $3,746 $320 Average Meridian Residential Listing - $300,000 June 18th, 2014 Homeowner Exemption - $85,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 Residential City of Meridian Property Tax Payments 2006 2007 2008 2009 2010 2011 2012 2013 —P—South Meridian Home rNorth Meridian Home Central Meridian HometGolf Course Home Historical Levy Rates 2006 2007 2008 2009 2010 2011 2012 2013 moomMeridian Levy Rate tTotal Ada County Levy • The levy rate is one small element of a property tax bill. • Legislative Exemptions Reduce of Shift Tax between residential and commercial — HB 645 Speculative land — HB 519 Site Improvements — Homeowners — Personal Property — Industry Specific • Other Taxing Entities • Taxable Value • Exemptions set by legislature • FY2011 and FY2012 Meridian did not take the allowable levy increase— some property taxes still increased $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 12 General Fund Undesignated Fund Balance Year -End Audited Financial Statements Estimated FY2013 FY2012 FY2011 FY2010 FY2014 ■ Operating Reserve ■ Undesignated Fund Balance GENERAL FUND - FUND BALANCE Estimated Undesignated Fund Balance 9/30/2014 FY2014 Admendments Undesignated Fund Balance 9/30/2014 CAPITAL IMPROVEMENT FUND BALANCE Undesignated Fund Balance 9/30/2014 FY2009 $3,760,207 $2,159,382 $1,600,825 378 ■ Need fund balance to cover routine replacements and maintenance. ■ Virtually all General Fund assets constructed with a 15 year period. ■ Buildings - $35 million book value ■ Improvements - $30.5 million book value ■ Equipment - $11,594,074 book value depreciated value - $4,216,594 — 64% depreciated ■ Increase in Police and Fire Employees increase vehicles ■ "Amendment Habit" - things come up, opportunities not foreseen in advance. ■ Property Tax revenue lags almost two years behind. ■ Development is up and down, have to be prepared for the down. Enterprise Fund Revenue Sources ■ All fee based — designed to cover; ■ Operating costs of getting services to and from customer on a daily basis. ■ Replace and maintain existing system as needed. ■ Expand infrastructure and make treatment and delivery improvements. ■ Fees can be structured in a variety of ways to capture needed costs but care must be taken to not capture a particular cost in more than one fee. $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 Water and Sewer Sales FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 Budget Budget FY2014 FY2015 Water Sales Sewer Sales • The "bread and butter" of the utility system. • Sewer sales moving with account growth — about 3% annually • Water sales have been moving ahead of account growth — variable — the hotter the better — plus there are sprinkler only accounts, hydrants etc. Sewer Sales and # of Accounts 30,000 $14,000,000 29,000 $12,000,000 28,000 $10,oBB,000 27,000 s8,0o0.00o 26,000 $6,000,000 25,000 24,000 $4,000,000 23,000 $2,000,000 22,000 $0 FY2008 FY2009 FY2010 Fn011 FY2012 FY2013 Budget FY2014 Sewer Sales ammAaounts Water Sales and # of Accounts $8,000,000 30,000 $7,000000 29,000 $6,000,aoo 28,000 $5,0B0,BBo 27,000 $4,000.000 $3,000,000 26,000 Water Sales 25,000 —Aaounts $2,000.aoa $1.00x000 24,000 $0 23,000 Sewer Sales and # of Accounts 30,000 $14,000,000 29,000 $12,000,000 28,000 $10,oBB,000 27,000 s8,0o0.00o 26,000 $6,000,000 25,000 24,000 $4,000,000 23,000 $2,000,000 22,000 $0 FY2008 FY2009 FY2010 Fn011 FY2012 FY2013 Budget FY2014 Sewer Sales ammAaounts $6,0oo,0oc $s,000,00C $4,000,00[ $3,000,00[ $2,000,00[ $1,000,00[ $C Connection Fees Utility Connection Fee History • Paid when property is "connected" to the water/sewer system and can receive service. • About 85% of total collections are from residential connections. • About 60% of total collections are for WWTP connections. $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 �2 Use for capital replacement and Enterprise Fund improvement/growth/technology Year -End Audited Financial Statements Est FY2014 FY2013 FY2012 FY2011 FY2010 i Unreserved fund Balance i Operating/Emergency Reserve ■ At 9/30/2013 ■ Construction in Progress - $10,077,101 ■ Other Assets (Buildings, lines, machinery and equipment) ■ Cost - $233,109,904 ■ Accumulated Depreciation - $59,228,153 ■ 25% Depreciated FY2015 Budget Presentation `s' %�• rt 4 K4'r'{'�S•:,,�iet�wr..«..: •rr� LI (k+P �' �"�-K. 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L•r 4Y� �.Ad —"iv.n •:r�'•'yy�'rrL• I� r ..� �T.\ jN Al t t At J ' Meridian Human Resources Compensation Plan and Benefits FY15 Budget Patti Perkins, HR Director IAN IF9JEW11.1 Crystal Ritchie, HR Manager Christena Barney, Benefits Coordinator Laura Lee Berg, HR Generalist Cory Bush, Administrative Assistant Accomplishments include: restructured HR support to departments, updated Service Anniversary recognition; performed Compensation Plan review; revamped Wellness program/changed vendors; created informal on -the -spot recognition program; launched new employee newsletter; conducted benefits plan review; established audits for benefits billing Offsite scheduled in September to articulate our mission and goals and create a strategic plan for2015 and beyond Many other projects identified to improve processes and service to the leaders and employees of the City ComtX46abort �VH t 11PIM5 polie4e5 vim., Evaplorlee Sa+- Job Deseriphor15 ^'9'4 - 0-pjradL lnpati`'S &rV(Crf14f4k+o - 24 mos - ApriI - R4ctas5iA"+tbns sj5,*m so,-n O,. ?Wn kj L WkoK4A.lc5 F`f15 (Vrw ? t i- NewoobS - AutomLie fAR fwms NK - Sep &tf, tots��MaoGS PFC'GMp �NtevtG ✓ CommonTemplaFe r ^rrra, p ric55Flt5- Rol7VGA'rat'F'tY> A yafr ce C-5 Oritneation fhvfSN,✓,c� n reg/s9 p�� ' Q� N� SfYA� J4j- Sw in, S+riLG+( .re- Rkwew 6GriG 1 S GrSn (� rhl etali'nrvient poems-Planaesi.�n/str41egy PULk �y y„y - ?wga sihce job mAiYMcs _ Fy 15 / stv"+hs ESS 3* - Vision - M iyii 2►�fj � Add PoI - o,u ccr; �., r X0114 Arc, icc Okp Reviow-.n yro` _5; - �`fonQ - PLan oFFsite -Sdary AAmin. 4ui4elines Wellncs5 WorI4. stDv OY Desi n/Dw Frwlizt �f Team Complete -pnkt,5i"process `Succ<sswn Plan n i ng ri z ps, p�mr -Ki 1a5 l.evcls n•y QCLYtbChn� eM l"., - UeC CogLc K%ng pttblic. Works Axio�manccAppraisal Form Rocessimproem�nt-arbiwa+a OrientafiOn-process Revise AdVerhYin Souris' inprowncn.r Frvr HRReportin� 5 IiR Comtnttnica#,ons Pot rr Reeajniiion Programs AtDL5hbarA �y +�t/-em I ee fry.. Onthcsper- aP ck et,., wnm> Training P W ,newseNw fi savicc Awards ampirk �,1 -IauiuJjlgi.w� . BEST M ✓-'�Na1kHn{�oards✓ r Empio�ee f:nyQyu„m� - Cdbtles �f? �y O (�Oinp/tom' OrgSh'4.ehtrc- We CARF ttia r,rcoka 0:5 T,lM1hNdI meL1 Arts Comm Yoa+hNOrKLikSkiliz J'I�YIP k,fflJomeffl, Compliances Tr�kl TiMfUeprn5P'� iw m hy3kl • LM5 f f, RIC #,UAit- ' ie(!f Retenfron gWlun5 EANC5 Fh+line ' 149 101 ForLeAtdAS - Ft-A- {iffw-kWing-Ptorzdare M�nun,l * Continue with Employees First Compensation Plan as developed in FY13, implemented in FY14 and communicated to City staff * Provides the Cit the best chance to remain competitive with other Y p public sector employers and to avoid large corrections to pay scale in future years * Recommend 1% market adjustment for all employees based on employment market comparisons and competitor plans to increase salary ranges Costs increasing due to overall rise in costs of medical technologies, prescription drugs, and other market factors * Affordable Care Act will increase costs, including a 5% pass-through fee from carriers to employers and mandated coverage in 2015 for seasonal employees working over 6 months/yr; other unknown costs * City of Meridian experience rating is 132% in FY2014 to date Delta Dental * Willamette Dental * VSP * Medical (BCI) * FSA rollover o% increase 3% increase o% increase 11 - 15.7% increase Intro $500 option * Mercer marketed to several other providers; differences did not warrant changing carriers Negotiated renewal of current BCI plan from 17.9% to 15.7% * Propose 11% increase option with higher deductible, co -pay and max out-of-pocket expenses * Integrate WELLNESS into plan design to provide incentives for healthy behaviors that will reduce experience ratings in the future through improved employee health Blue Cross Renewal Numbers Rates Employee EE/Spouse EE/Child EE/Children Family Monthly Cost Annual Cost %Increase/Decrease over Current $Increase/Decrease over Current $Increase/Decrease over Neg Renewal Composite Rate (PEPM): #of Ees Current Renewal Negotiated Renewal Negotiated Option $500 Deductible (Current Plan Design) $750 Deductible 86 $449.31 $529.72 $52o.6o $498.69 48 $981.68 $1,157.37 $1,135.69 $1,089.57 25 $663.13 $781.81 $767.64 $736.o1 22 $787.87 $928.87 $911.76 $874.46 161 $1,178.94 $1,389.93 $1,363.6o $1,3o8.51 342 $309,482.03 $364,868.8o $358,074.04 $343,495.18 $3,713,784.36 $4,378,425.6o 4296,888.48 $4021,942.16 17.9% 15.7% 11.0/ $66041.24 $583004.12 $408,157.8o 3174,946.30 $904.92 $1,o66.87 $1,047.00 $1,004.37 mployee Only Discounts Monthly Annual Premium Premium on -Tobacco Use Discount for Biometric Screening mium with Both Discounts Community Development Budget Presentation FY X014-15 July 8, 2014 JAWMAW wWRIDIAN- TN HO Ground to Cover • Enhancement #1: Building Official FTE - Why the position is needed - Revenue history: permitting trends -Revenue vs. expense: paying for the position • Enhancement #2: LaserFiche License • Enhancement #3: Arc View License C0 114 AVI EIDIAN:-- IDAHO