Water Resources Board

MINUTES MURFREESBORO WATER RESOURCES BOARD December 12, 2023 ______________________________________________________________________________ The Murfreesboro Water Resources Board met on Tuesday, December 12, 2023, in the conference room of the Operations and Maintenance Building, 1725 South Church Street. Present at the meeting were Board members: Mr. Ron Crabtree, Mr. Brian Kidd, Ms. Madelyn Scales-Harris, Mr. John Sant Amour, Ms. Sandra Trail, and Mr. Kirt Wade. Also present were Darren Gore, Valerie Smith, Michele Pinkston, Doug Swann, Alan Cranford, Roman Hankins, Jennifer Tag, Joe Russell, Matt Powers, Adam Todd, Linda Sullivan, Steve Campbell, Marshall Fall, Susan Osterburg, Donald Hughes, Travis Wilson, and Brent Fowler, along with other members of the public. The Consent Agenda was presented to the Board for approval: A. Consider sewer easement abandonment within Regal Square B. Consider SRWTP Switchgear Improvements final change order C. Consider Civil Infrastructure Associates engineering design proposal for Cherry Lane Extension Phase 3A D. Consider TTL, Inc. geotechnical services proposal for 316 Robert Rose parking lot E. Consider MWRD Engineering vehicles purchase Sandra Trail made a motion to accept the Consent Agenda as presented and it was seconded by Kirt Wade. The motion carried unanimously. The September 26, 2023 Board Minutes were accepted as presented. The Board considered the June 30, 2023 Water Resources Department (draft) Audit Summary and the June 30, 2023 Stormwater Fund (draft) Audit Summary. The table below summarizes the Department’s financial position for the Water Resources fund: June 30, 2023 June 30, 2022 Current Assets $ 157,402,214 $ 151,340,242 Capital Assets 454,362,793 432,333,840 Non-Current Other Assets 64,820 3,488,982 Deferred Outflows 9,932,644 7,976,025 Total Assets and Deferred Outflows $ 621,762,471 $ 595,139,089 Current Liabilities $ 14,833,388 $ 13,321,453 Non-current Liabilities 104,566,575 107,542,840 Deferred Inflows 19,570,183 25,606,291 Total Liabilities and Deferred Inflows $ 138,970,146 $ 146,470,584 Net investment in capital assets $ 397,087,684 $ 366,835,855 Restricted for net pension asset - 3,423,532 Restricted for employee benefits 27,803 28,432 Restricted for matured bonds 37,018 37,018 Unrestricted 85,639,820 78,343,668 Total Net Position $ 482,792,325 $ 448,668,505 Total Liabilities, Deferred Inflows and Net Position $ 621,762,471 $ 595,139,089 Page 18 Water Resources Board Minutes December 12, 2023 Page 2 The table below summarizes the Department’s financial position for the Stormwater fund: Summary information regarding Stormwater Fund's financial position is as follows: June 30, 2023 June 30, 2022 Cash $ 6,677,422 $ 6,672,035 Utility Plant 5,885,245 5,628,109 Deferred Outflows 367,840 238,782 Prepaid Expenses and Other Assets 23,131 207,461 Total Assets and Deferred Outflows of Resources $ 12,953,638 $ 12,746,387 Trade Accounts Payable $ 173,215 $ 16,439 Other Liabilities 38,998 22,779 Deferred Inflows 572,681 834,703 Due to Other Funds 357,755 791,031 Long-Term Liabilities 2,017,827 1,822,476 Total Liabilities and Deferred Inflows of Resources $ 3,160,476 $ 3,487,428 Net Position Net Investment in capital assets $ 5,885,245 $ 5,628,109 Restricted for net pension asset - 188,329 Unrestricted 3,907,917 3,442,521 Total Net Position $ 9,793,162 $ 9,258,959 Total Liabilities, Deferred Inflows and Net Position $ 12,953,638 $ 12,746,387 The year-end financial segments, accounting policies, retirement plan, and the debt of the department, etc. was of clean opinion and in stable condition. Staff requested approval of the June 30, 2023 draft audit of the Murfreesboro Water Resources Department. Madelyn Scales-Harris made a motion to approve. Sandra Trail seconded. The motion unanimously passed. Staff requested approval of the June 30, 2023 draft audit of the Murfreesboro Stormwater Fund. Kirt Wade made a motion to approve. Madelyn Scales-Harris seconded. The motion unanimously passed. The Board considered the Overall Creek Forcemain Extension Final Change Order. At the September 2022 Board meeting, this contract was approved and awarded to Cleary Construction, Inc. Cleary constructed the forcemain with one year of construction time left to spare and $756,852 less than the approved contract amount of $8,439,290. Staff recommends approval of the deductive Final Change Order. Sandra Trail made a motion to approve. Brian Kidd seconded. The motion unanimously passed. The Board considered the purchase of SRWTP sampling stations to be installed at selected bacteriological sampling sites that are used for distribution system sampling. In August 2023, the department had several positive samples for total coliform bacteria. The site where the positive samples were collected is not ideal for sampling collection, in accordance with accepted standard procedures for collecting water quality samples. Thus, staff requests installing sampling stations Page 19 Water Resources Board Minutes December 12, 2023 Page 3 at some the sampling sites and see how these work versus using the outside faucet at an individual’s home. Some of the benefits to using a sampling station instead of a homeowner’s outside faucet are: 1. It will eliminate the possibility that the homeowner has a home treatment device that will contaminate the sample. 2. It will eliminate sampling from outside faucets which can lead to contaminated samples, especially if there are threads. Threads on faucets are leading causes of contaminated samples. 3. It will reduce or eliminate the number of false positives. The Department collects a minimum of 100 bacteria samples from the distribution system each month in accordance with TDEC regulations. Samples are collected from low use, near dead end lines and areas near all storage tanks. Samples are not collected from the end of a line to allow for repeat sampling in the event of a coliform positive sample. An average of six to seven samples per day are collected over the first three weeks of the month to ensure that 100 percent of the required samples are collected. The last week of the month is used to ensure that samples representing the entire distribution system including low use areas, residential areas and areas near large storage tanks were collected. Staff requests the Board approve the purchase of the equipment from Fortiline, Inc. in accordance with their quote. The cost for the equipment is $46,400. Funding for the equipment will come from the FY24 CapEx. Sandra Trail made a motion to approve. Kirt Wade seconded. The motion unanimously passed. The Board considered SRWTP Granular Activated Carbon Media Replacement 3rd amendment. Granular Activated Carbon (GAC) media is used in the water treatment process to remove disinfection by-products (DBPs), total organic carbon (TOC) compounds, pharmaceutical and personal care products (PPCPs), taste and odor compounds, and other contaminates during the peak seasonal times. The Stones River Water Treatment Plant has four GAC contactors used in the treatment process. The Department changes media in one contactor per year, unless unusual circumstances exist. On January 18, 2021, the City released and advertised an Invitation to Bid for Granular Activated Carbon (GAC) media for use at the Stones River Water Treatment Plant. The First Amendment started July 2022, and the media was replaced at the contract amount of $122,840. The Second Amendment started in July 2023, and the media was replaced at the new amount of $143,560. In preparation for July 2024, discussion with Calgon and staff led to Calgon’s request for the City to make price adjustment due to market conditions beyond their control for their Third Amendment. Staff recommends this adjustment for the new amount of $150,960. This adjustment was submitted to purchasing and legal for review and completion of the Third Amendment. Staff requests the Board recommend to City Council approving the third amendment from Calgon Carbon Corporation GAC in the amount of $150,960 with funding from the FY24 capital budget. Brian Kidd made a motion to approve. Ron Crabtree seconded. The motion unanimously passed. Page 20 Water Resources Board Minutes December 12, 2023 Page 4 The Board considered SSR Task Order 2341043.0, VA Pump Station Study. Staff has become concerned with the capacity remaining in the VA PS located along Memorial Blvd. This station serves a large area, mainly the corridor along Memorial Blvd and to the east. The corridor along Memorial Blvd has developed quite densely, and therefore, staff has requested a Task Order from SSR to complete a capacity study. Staff will notify stakeholders, Planning Commission and City Council, that MWRD will hold consideration for any new sewer connections, not already approved by Planning Commission as of the December 13, 2023, meeting. Staff also requests Planning to discontinue acceptance on any new submittals for review and approval which have not already had a Due Diligence or Pre-Application meeting within this area. Staff requests this pause for a period of eight months for the study and to develop guidance on how dense the remaining properties within this area can develop. Approving additional high-density developments may pose a risk of causing sanitary sewer overflows upstream of the station. The department does not have any designed upgrades for this station. However, there are plans to remove flow from the VA PS with the proposed eastern most PS along the new Cherry Lane corridor. MWRD cannot guarantee the timeline that these PS improvements will be constructed or the exact number of new connections that may ultimately become available. Once this study is completed, the information will be presented to the Water Resources Board, Planning Commission and City Council and submittals of plans to Planning and MWRD can recontinue. Staff requests approval of SSR’s Task Order for the study and for funding through Working Capital Reserves in the amount not to exceed $48,700. Brian Kidd made a motion to approve. Sandra Trail seconded. The motion unanimously passed. The Board considered the CIA proposal for N. Thompson Ln. & Stones River National Battlefield pump station replacements. These two pre-existing sewer pump stations are being recommended for upsizing and replacement. PS35 is located at the corner of N. Thompson Lane and Medical Center Parkway. The area served by this station is very active and staff has received phone calls requesting sewer availability and capacity for a car wash and two hotels. After studying this station, which was built in 1996 or 27 years ago, it was determined it could not handle additional flow from these developments. The wetwell is too small and the station can only use a single pump based on degradation of suction line piping. There are several properties that are vacant in this area and are very motivated to develop. The second station serves the Stones River National Battlefield Visitors Center and residences. It is a very small vacuum pump station that was built in 1977, 46 years ago. This station is so old that parts are no longer available and is overloaded during events at the visitor’s center. Staff requests the approval of CIA’s engineering proposal in the amount of $115,000 with funding from working capital reserves. The estimated cost for the replacements is in the amount of $3,102,000. Page 21 Water Resources Board Minutes December 12, 2023 Page 5 Sandra Trail made a motion to approve. Kirt Wade seconded. The motion unanimously passed. The Board received the FY24-FY28 Capital Improvements Plan (CIP) update. Staff has drafted an updated 5-Year Capital Improvements Plan (CIP) from Fiscal Year (FY) 2024 through 2028. The primary focus of this preliminary draft is the capital improvements projected to be funded by working capital reserves. After receiving the FY22-23 draft estimate of the Department’s working capital reserve amount (unrestricted net position) of $85.6M provided by Jobe Hastings, PLLC (JH), staff has been able to “reset” the amount of available funds in the Department’s working capital reserve account and therefore provide a more updated accurate reflection of the Department’s reserve balance. An additional $10.1M has been added to the audited amount to account for the American Rescue Plan (ARP) funds that have been committed to MWRD, bringing the total up to $95.75M. Taking into account estimated reserve revenue and reserve expense through October 31, 2023 reduces the total available cash in reserves to $90.14M. The FY24-28 Capital Improvements Plan highlights three major project classifications: 1. Projects funded through Debt Service 2. Projects/Purchases funded through Rates 3. Projects/Purchases funded through Working Capital Reserves The largest components of the FY24-28 CIP are those projects funded through working capital reserves. These are sub-classified as the following: 1. Water and Sewer Capital Improvement Projects 2. Transportation (Water/Sewer Improvements) 3. Sewer Rehabilitation 4. Information Technology Projects Based on the excess funds minus the outstanding committed projects and sanctioned/pending projects, approximately $22.2M of unassigned cash in reserves is determined available as of October 2023. When applying this to the FY24-28 CIP, and assuming projected additional FY24 reserve fund revenue and expenditures a working capital account balance of available funds is estimated as $67.4M at FY24 year- end. Subsequent year-end available reserve balances have been estimated over the five-year CIP horizon. When plotting that balance against the Department’s 12 months operating expenses (i.e., the minimum allowable working capital reserve fund balance), current planned expenditures never go below the secured level but get within $5.1M in FY27. Operational expenses are assumed to increase at 2% annually over the 5-yr CIP. The 12 months’ worth of O&M expense is considered a secured minimum balance for the working capital reserve account as approved by both the Board and City Council through the adoption of the Water and Sewer Enterprise Fund Financial Management Policies. Two debt funded projects have been programmed into the proposed 5-yr CIP. The Northeast Regional pumping station has been removed from the 5-yr CIP as it is not expected to be constructed within that time horizon and may not be built based on cost to benefit. The Full-scale Biosolids Drying project Page 22 Water Resources Board Minutes December 12, 2023 Page 6 construction cost is programmed into the next general obligation bond debt issuance the City has scheduled expected in mid-2024. The Cherry Lane Corridor Sewer Service Improvements has also been scheduled as part of the City’s 2026 debt issuance but may shift according to the City’s schedule on construction Cherry Lane Phase 3A and 3B. The total increase in capital improvement projects funded with cash from reserves decreased from $101.63 to $92.47 using working capital reserves. Anticipated debt service stayed approximately the same – going from $59.5M in FY23 to $59.25M in FY24. Staff is providing this to the Board as information only. Subsequent discussion and appropriate recommendations will be provided as projects are requested for design and construction. Staff presented the Water Resources Dashboard Performance for October and November 2023. Staff presented the Financial Reports for the year ending October 31, 2023. There being no further business, the meeting was adjourned. _____________________________ John Sant Amour, Chairman Page 23