City of Roundup, Montana Water System PER Public Hearing March 6, 2018

Water System Study Preliminary Engineering Report (PER) Examines Comprehensive Needs for: Growth/Capacity Water Supply Water Quality/Treatment Water Storage Distribution System Water Meters Required to Apply for Grant and Loan Funding

Water Supply Current: Two Wells south of the River Wells: Capacity of 1,000 gpm each Depth of 90 feet Infiltration Gallery Bypassed and used as a Backup source Water Quantity is sufficient to meet current and projected demands.

Water Quality Water Quality Although there are no health violations, the water is high in sulfate, TDS, iron and manganese: TDS = 580% Iron = 480% Manganese = 680% Sulfate = 620% Potential Health and Safety Risks Long term exposure to iron is harmful Hemochromotosis risks Lead from cast iron mains

Water Storage Storage Tank provides Domestic and Fire Flow Storage 2,000,000 Gallons, 1,990,000 required Tank is well maintained and has no structural issues Tank is cleaned every 7 years. Next cleaning is scheduled for 2018 in the CIP.

Distribution System Main Condition: Main size varies from 4” to 12”, pipe types vary from cast iron, AC and PVC Cast iron mains are in poor condition 4” mains not able to provide adequate fire flow Rust has limited capacity down to a 2” main. Leak repair rate of cast iron mains is 4 times higher than normal.

Fire Flow

Distribution System Condition of Valves: Hydrants: Water Loss Many valves are in-operable Valves required on every block Isolating mains is difficult Hydrants: Not adequately spaced to meet fire protection requirements Many need replacement Water Loss Average = 24% (Standard is 10%)

Leaks

Cast Iron Mains-2010

Mains Replaced

Main Replacement Progress 2010 Estimated 45,680 feet of cast iron mains (8.65 miles) 2018 (After all Phase 4) Estimated 19,200 feet of cast iron mains remaining (3.64 miles) 58.2% Completed after Phase 4

Summary of Needs/Alternative Development Distribution System Improvements Keep going on cast iron mains Alternative Development Three alternatives identified

Alternatives Considered In Detail Distribution System Alternatives: D-2: Replace all cast iron mains and AC mains in the highway with 8” PVC mains. D-3: Alternative D-2 plus replace three blocks of 4” PVC D-4: Alternative D-3 plus the remaining 4” AC mains that are limiting fire flows.

Decision Matrix & Weighing Factors Weighting Factors Life Cycle Costs = 10 Operation and Maintenance = 7 Permitting Issues = 5 Social Impacts = 7 Environmental Impacts = 5 Sustainability = 4 Land Acquisition = 5 Public Health and Safety = 10

Preferred Alternative Decision Matrix Preferred Alternative Alternative D-3: Replace all cast iron mains, plus three blocks of 4” PVC main.

Estimated Costs for Improvements

Remaining Water Main Replacements (Red)

Phase 5 Estimated Costs

Phase 5 Schedules

Potential Grant Funding & Target Rates Information On Target Rate Calculation Target rates based on median household income (MHI) as determined from the 2017 Income Survey Water = $33.30 Sewer = $21.40 Existing Rates (average resident) Water = $40.78* Sewer = $29.66 Rates will be 129% of Target Rate

Grant/Loan Eligibility Treasure State Endowment Program (TSEP) - $500,000 to $750,000 (Phases 1, 2 and 3) 50-50 match (cannot exceed 50% of project costs) User rate must meet or exceed target rate Roundup = 129% of water rate = $625,000 grant Will be highly competitive this year Department of Natural Resources and Conservation Renewable Resource Grant and Loan Program (DNRC- RRGL) - $125,000 (Phases 1 and 2) Conserve, manage, develop, or protect renewable resources With fixing of water main leaks, this project presents a strong case for water conservation

Grant/Loan Eligibility CDBG– Community Development Block Grants Grants up to $450,000 25% match required > 50% Low to Moderate Income (LMI) (Income Survey) Very competitive Roundup LMI = 60.0% Used on Phases 3 and 4

Grant/Loan Eligibility Coal Board No limit-but funding is scarce Water Projects are eligible Coal Board has funded a lot of recent projects in Roundup Used on Phases 1, 3 and 4 with Special Circumstances

Grant/Loan Eligibility Rural Development – No limit but is part of grant/loan combination Priority given to communities with population < 5,500 Amount based upon MHI: MHI < $47,757 up to 45% of project costs grant eligible MHI < $38,205 up to 75% of project costs grant eligible Current Loan Rate = 2.75% over 40 years ($4.25 per EDU per $1M) Roundup population qualifies (1,788 < 5,500)

Grant/Loan Eligibility Montana SRF Loan– Offers Loan Forgiveness Loan Forgiveness Up to $500,000 Current Loan Rates = 2.50% over 20 or 30 years Used on Phases 2 and 3 Could be used as a back-up source of funding (20 years = $6.50 per $1M borrowed) (30 years = $4.85 per $1M borrowed)

Phase 5 Funding Plan TSEP Grant $ 625,000 DNRC Grant $ 125,000 CDBG Grant $ 450,000 City Matching Funds $ 300,000 SRF Forgiveness $ 472,000 SRF/RD Loan $ 473,000 Total: $2,445,000 If any grant applications are unsuccessful, project can be downsized or a new SRF or RD loan obtained.

Project Schedule Schedule is dependent on funding strategy: TSEP Funds available in July, 2019 DNRC/RRGL Funds available in July, 2019 CDBG Funds available by early 2020 SRF Available at Anytime Design = 4 Months DEQ Review = 2 Months Bidding = 1 Month Construction = Up to 4 Months, Completed in Fall, 2020

Questions and/or Comments?