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April 8, 2014 Presented by: Lunenburg Sewer Commission.

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1 April 8, 2014 Presented by: Lunenburg Sewer Commission

2 At the May 3 rd Town Meeting the Sewer Commission will be presenting a Warrant to authorize borrowing up to $2.2 M for two simultaneous sewer extensions:  Pratt and Rennie Streets  Lakeview Ave area (Cross Rd, Harris Ave, Pine Grove Rd. Sunset Ave)  By combining these two projects the Commission hopes to realize some economies of scale to lessen the burden on the residents SRF low interest loans are expected to provide most of the funding Sewer Betterments covering all costs will be assessed to affected residents  No impact to the tax base or rest of Town residents

3 Lakeview/Pratt Sewer Extensions Overview, Slide 3

4 Lakeview/Pratt Sewer Extensions Overview, Slide 4

5 After 3 year detailed study, 2010 CWMP identified both areas as “Needs Areas”  Pratt/Rennie Streets  These streets were in original Phase 1 design but never constructed  High water table makes conventional Title 5 systems problematic  Lakeview Ave. Area (Cross Rd., Harris Ave., Pine Grove Rd., Sunset Ave., Lakeview Ave.)  Ranked second highest in 24 areas evaluated in CWMP Needs assessment  Very dense housing with several Title 5 failures  Proximity to Lake Whalom also drives need Both projects were initiated by local residents Lakeview/Pratt Sewer Extensions Overview Slide 5

6 Sewer Commission Extension Policy requires 2/3 (66%) of affected residents to agree (in writing) to go ahead with a sewer extension Lakeview Avenue Area  Total affected properties=42  Responded positively=29  Percent approval=69% Pratt/Rennie Street Area  Total affected properties=39  Responded positively=29  Percent approval=74% Kudos to Mike Nault and Dave Mac Donald for reaching out to the residents Lakeview/Pratt Sewer Extensions Overview Slide 6

7 Estimated Betterment Total Cost of Both Projects$2.2 M  Includes ~ 20% layered contingencies  Includes ~ 15% for additional engineering/surveys and legal  Does not include resident costs for low pressure pumps/connections  SRF Funding Low Interest Loan Eligible Cost $1.6 M  Applications submitted and ranked very high by State  On Mass DEP Final 2014 Intended Use Plan list of projects to be funded Additional funding/borrowing by Town is required  Near term for engineering/design required for October SRF application  Cost estimates being requested now All costs for both projects will be part of the Betterment to be shared by residents with access to new sewer lines  No net cost to Town or Sewer Enterprise Fund Need to investigate possible Federal funding of road work on Pratt

8 SRF Project Evaluation Form (PEF)August 2013 Project Makes SRF Fundable ListDecember 2013 Confirmed Resident SupportMarch 2014 Town Meeting VoteMay 2014 Engineering/Design & Cost UpdateJuly – Dec 2014 SRF ApplicationOctober 2014 SRF Funding AuthorizationDecember 2014 Construction May 15–May 16 Betterment AssessmentsJune – July 2016 Lakeview/Pratt Sewer Extensions Overview Slide 8

9 Residents who initiated and worked hard to get necessary support from area  Paul Michaud, Pratt Street  Larry Corbett, Mike Raboin and Walter Rinki, Lakeview Ave. area Sewer Commission Business Manager for keeping this moving with mailings and maintaining critical documentation  Barb Lefebvre Sewer Commissioners who took initiative and personal time to get signatures that got Pratt area to meet 2/3rds requirement  Dave Mac Donald and Mike Nault Wright-Pierce Engineering for an excellent and winning SRF PEF  Kevin Olson Town Manager and BOS for your time, guidance and continued support Lakeview/Pratt Sewer Extensions Overview Slide 9

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11 April 8, 2014 Presented by: Lunenburg Sewer Commission

12 Business Manager: Barb Lefebvre DPW Director: Jack Rodiquenz Commissioners:  Carl LuckChairman  Jay SimeoneVice Chairman  Dave MacDonaldClerk  Mike NaultMember  Butch BilottaMember  Small Water Systems : Systems operations and maintenance contractor  Weston and Sampson: Primary Engineering Consultants  Many Thanks to this Hard Working and Dedicated Team

13 Finalized New IMA with Fitchburg  Secured new capacity to support current and new demands per CWMP  Eliminated separate capital payments  Rate equal to Fitchburg residents, No additional $1.65 adder unless justified/agreed Successful Outsourcing of Sewer Systems Maintenance  System reliability improved, significantly less call outs  Support is excellent and price/cost below FY 14 budget  FY 15 price agreed at 2.5% increase FY 2014 revenues and cost running true to Balanced Budget Continued I/I Reduction Program  Phase 2, house to house in process Achieved 100% Grease Trap Permit Compliance  Reporting next challenge Completed Lancaster Ave. Private Extension  Several new policies and lessons learned captured

14 Total Design Cost$333,708 Construction Cost$1,776,753 Total JFI Cost$2,110,461 Loan Payments Design$26, Construction$112, Total Loan Payment$138, Lunenburg Share Design flow 1,126,000gallons / day Lunenburg Share 151,000gallons / day % of project13.41% Total JFI annual debt$138, Lunenburg Share$18,597.76

15 Usage Rates Paid by Lunenburg FY 14FY 15  Leominster(per 100 cu. ft.)$  Fitchburg$8.95 $7.30 Rate to Lunenburg Users (per 100 cu. ft.) $11.50$11.50 Total Number of Users/Connections  To Leominster  To Fitchburg Units with access not Connected Total Units with Access 1,063 1,063 Pratt and Lakeview Potential Users81

16 SEWER ENTERPRISE ADJUSTED FY14 BUDGET PROPOSED FY15 BUDGET INCR/DECR OVER FY14 FINAL BUDGET REVENUES User Charges $ 683, $ 709, $ 26, Connection Fees $ 22, $ 27, $ 4, Sewer Bank Fees $ 7, Penalties & Interest (incl. prior year pmts) $ 6, $ 8, $ 1, Drain Layer Fees $ 1, $ - Grease Trap Annual permit fees $ 1, Investment Income $ 1, $ 2, $ Sewer Use Regs$0.00 $ - Highfield Capacity -Reserve Fund - one time pmt $ 57, Adjusted Total Revenues $ 714, $ 814, $ 99,629.00

17 User Fees = 95% of Operating Revenues

18 Addition of 22 new connections/users No rate increase to Lunenburg customers Outsource contract increase of 2.5% No new rate increases from Fitchburg Leominster rate increase assumption of 5% included in Budget No extraordinary legal fees Continuation of I/I reduction at roughly $35,000 in FY 15 Addition of generator maintenance outsourcing/contract with current operations company No impact to Enterprise Fund with proposed extensions at Lakeview and Pratt

19 No transfers from Retained Earnings for Operating Budget BALANCED BUDGET Retained earnings as of 7/1/13 were $471,785 John Fitch Highway Upgrade Treatment  Expected upfront income of $57,716 from Highfield capacity charge shown in FY 15 Revenue  $54,830 of this amount shown as cost, to be moved to separate account to be drawn on annually (working with Town and Fitchburg to simplify process)  $2,886 included in projected annual payment of $18,598 to Fitchburg  This income is not reflected in “Operating Income” on prior slide Inflow and Infiltration Fee  As this $7,440 is an I/I “Bank” that is restricted for use on I/I reduction, it is not considered part of the “Operations Income” in analysis  For the FY 15 budget we have reduced the planned costs of $35,000 for I/I reduction by this amount

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