HomeMy WebLinkAboutItem G (16) Sewer and Water Capital Charges - Enactment of Escalation Clause
AGENDA ITEM COVER SHEET
Contact Name:
Contact Number:
David A. Wheeler, P.E.
407-905-3100
Meeting Date: January 18, 2005
Item # lto
Reviewed By: ~ ~/J/J
Department Director: ,~ ::'/Jv
City Manager: _~U ____ _
Subject: Enactment of Escalation Clause for Water and Sewer Capital Charges for New
Development
Background Summary:
In paragraphs 173-21 and 173-37 of Chapter 173 - Water and Sewer of the Ocoee City Code are
escalation clauses for adjustmert to the Water and Sewer Capital Charges, respectively. These clauses
have been in the City Code since enactment under Ordinance 9219. The escalation clause as stated in
the City Code is referenced to the Engineering News Record Construction Cost Index. The Water and
Sewer Capital Charges as set in 1992 are $966 for water and $2,865 for sewer. Based upon the
escalation clause the Capital Charges should have adjusted each year and be at $1,397 for water and
$4,089 for sewer.
Issue:
Chapter 173 of tt-e Ocoee City Code includes an escalation clause for adjusting the Water and Sewer
Capital Charges for new development. This clause has not been utilized since it was enacted in the City
Code in 1992.
Recommendations
There is no action required by the City Commission. This staff report is to inform the City Commission
that the Public Utilities Department must adjust Water and Sewer Capital Charges to comply with
Chapter 173, paragraphs 21 and 37 of the Ocoee City Code. The adjusted Water and Sewer Ca~al
Charges will start being assessed on February 1, 2005
Attachments:
Powerpoint Presentation
Financial Impact:
By increasing the Capital Charges for water and sewer this will provide necessary funding for the continued
expansion of the City's utility system to meet future growth within the service area.
Type of Item: (please mark with an "x')
Public Hearing
_ Ordinance First Reading
Resolution
Commission Approval
Discussion & Direction
For Clerk's DeDt Use:
_ Consent Agenda
Public Hearing
_ Regular Agenda
Original Document/Contract Attached for Execution by City Clerk
_ Original Document/Contract Held by Department for Execution
Reviewed by City Attorney
Reviewed by Finance Dept.
Reviewed by ( )
Paul Rosenthal has given his approval
N/A
N/A
N/A
City Manager
Robert Frank
Commissioners
Danny HowelL District 1
Scott Anderson, District 2
Rusty Johnson, District 3
Nancy J. Parker, District 4
Mayor
S. Scott Vandergrift
STAFF REPORT
TO:
The Honorable Mayor and City Commissioners
FROM:
David A. Wheeler, P.E., City Engineer & Director of Public Utilities
DATE:
January 10, 2005
RE:
F"c'~l~tion ofW~tp.r ~nn Sp.wp.r r~nit~l rh~rpp." for Np.w Op.vp.lonmp.nt
-- ----------- ~- .. ----- -----. .- -" -- - --r----- ------0-- --- -. -.. - - . ---r-------
ISSUE
Chapter 173 of the Ocoee City Code includes an escalation clause for adjusting the Water and Sewer Capital
Charges for new development. This clause has not been utilized since it was enacted in the City Code in 1992.
The Public Utilities Department proposes to follow the escalation clause and adjust the Water and Sewer Capital
Charge by the representative factor as calculated for each year from 1992 to the present.
BACKGROUND/DISCUSSION
In paragraphs 173-21 and 173-37 of Chapter 173 - Water and Sewer of the Ocoee City Code are escalation
clauses for adjustment to the Water and Sewer Capital Charges, respectively. That escalation clause reads as
follows:
"The City hereby declares that the schedule of water (and sewer) capital charges set froth herein shall be
escalated based upon increases arising from these factors as set forth and identified as the Engineering
News Record (ENR) Construction Cost Index as established on Janaury 1 of each year. The water (And
sewer) capital charges shall be automatically adjusted annually by the percentage change in the ENR
Construction Cost Index as established on January 1 of each year.
These clauses have been in the City Code since enactment under Ordinance 92-19. The escalation clause has
never been utilized for some reason.
The escalation clause as stated in the City Code is referenced to the Engineering News Record Construction Cost
Index. This index is a calculation taken from labor and material costs as reported for a twenty-city average from
across the Untied States. These costs are compared to the base year that the index was started, which 1913. The
following table shows the annual average as stated in the Construction Cost Imex and the representative
adjustment based upon market conditions:
YEAR ANNUAL PERCENT
AVERAGE ADJUSTMENT
vs. Previous Year
1992 4985
1993 5210 4.51 increase
1994 5408 3.80 increase
1995 5471 1.16 increase
1996 5620 2.72 increase
1997 5826 3.67 increase
1998 5920 1.61 increase
1999 6059 2.35 increase
2000 6221 2.67 increase
2001 6343 1.96 increase
2002 6538 3.07 increase
2003 6694 2.39 increase
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1992 to 2004 42.73 % increase
The Water and Sewer Capital Charges as set in 1992 are $966 for water and $2,865 for sewer. Based upon the
escalation clause the Capital Charges should have adjusted each year and be at $1,397 for water and $4,089 for
sewer.
The Public Utilities Department plans to adjust the Water and Sewer Capital Charges and increase them in
accordance with the escalation clause as stated in Chapter 173 of the City Code and that the Water and Sewer
Capital Charges will be brought to current based upon the adjustment factor calculated for each year since tre
escalation clause has been in effect since 1992. The overall increase in the Water and Sewer Capital Charges
will be 42.73 % and the Water Capital Charge shall be $1,397 and the Sewer Capital Charge shall be $4,089.
The Capital Charges are collected to pay for capacity within the Utility System and to fund expansions to the
water treatment and wastewater treatment plants and new extensions of the water and sewer pipelines. The
Capital Charges can also be used for paying for upsizing of pipelines that are proposed for replacement or
rehabilitation. Some projects that can be funded by the Capital Charges are the expansion to the wastewater
treatment plant that will need to start design in about five years, expansion of the sanitary sewer system into the
northwest sector of the service area, upsizing of the pipelines on SR 50 that will need to be relocated as a result
of the widening of road, and the continued expansion of the reuse system.
CITY of OCOEE
IiIiIiIi
WATER and SEWER
Capital Charges
,
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Charges
Water & Sewer Capital
,q. Sewer Capital Charges
;. $2,865 per equivalent
residential unit
4- Water Capital Charges
;. $966 per equivalent
residential unit
water)
ding is 0.334
000 SF
~ Examples (same for
q. Office Buil
ERUs per I
.;. Examples (same for sewer)
~ Single Family Residence
is 1.0 ERUs
is by fixture
17 ERUs per
is 0.0
73-28)
I
Warehouse
unit
Church
seat
(City Code Sec
q.
is 0.833
q. Doctor's Office
ERUs per doctor
q.
q. Restaurant is 0.100 per
seat for full service
I
73-11 )
(City Code Sec
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Ocoee vs Central Florida
Water
Casselberry $515 OUC $1,060
Winter Springs $518 Orange Co. $1,095
Altamonte $600 Winter Park $1 ,1 00
Maitland $900 Toho Water $1 ,140
Ocoee $966 Mt. Dora $1,290
Seminole Co. $990 Winter Garden $1,310
Lake Mary $1,010 Oviedo $1,500
Clermont $1,023 Apopka $2,100
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Ocoee vs Central Florida
Sewer
Winter Garden $2,035 Lake Mary $2,535
Seminole Co. $2, 1 00 Orlando $2,537
Casselberry $2,137 Winter Park $2,700
Winter Springs $2,199 Ocoee $2,865
Altamonte $2,255 Maitland $2,890
Toho Water $2,316 Clermont $2,918
Mt. Dora $2,468 Oviedo $3,240
Orange Co. $2,487 Apopka $3,324
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1992
1999
2002
2000
Seminole Co. 1990
Winter Garden 2003
Winter Park 2004
Winter Springs 2002
Central Florida Capital Fees
(when last updated)
Ocoee
Orange Co.
OUC
Oviedo
2004
1992
1987
2003
1998
1997
2000
2001
Apopka*
Altamonte
Casselberry
Clermont
Lake Mary
Lake Toho
Maitland
Mt. Dora
..
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Ocoee Historical Data
q,. Ocoee Purchased Prima Vista Utilities 1987
4 Ordinance 88-32 established the Capital Charges
at $750 for water and $2,500 for sewer
~ Ordinance 90-06 amended the Capital Charges to
their current level of $966 for water and $2,865
for sewer (Based upon Rachlin & Cohen, CPA
Report )
4 Ordinance 92-19 amended the Capital Charges to
allow for an annual escalation
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Charge Escalation Clause
Capital
4.
',1\
~
~ The City hereby declares that the schedule
of water and sewer capital charges set forth
herein shall be escalated based upon
increases arising from these factors as set
forth and identified as the Engineering
News Record (ENR) Construction Cost
Index as established on January 1 of each
year.... (Continued)
Charge Escalation Clause
Capital
f.j..~.
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4- The water and sewer capital charges shall
be automatically adjusted annually by the
percentage change in the ENR Construction
Cost Index as established on January 1 of
each year.
(Ocoee City Code Sections
and 37)
173-21
,
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50
I
ENR Construction Cost Index
92 to 93 Up 4.51 % 99 to 00 Up 2.67%
93 to 94 Up 3.80% 00 to 01 Up 1.96%
94 to 95 Up 1.16% 01 to 02 Up 3.07%
95 to 96 Up 2.72% 02 to 03 Up 2.39%
96 to 97 Up 3.67% 03 to 04 Up 6.29%
97 to 98 Up 1.61%
98 to 99 Up 2.35% 92 to 04 Up 42.73%
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Water & Sewer Capital Charges
4- Using the 42.73% Escalation Factor from
1992 to Present New Capital Charges:
Water Capital Charge Increases to $1,379
Sewer Capital Charge Increases to $4,089
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Ocoee vs Central Florida
Water
Casselberry $515 OUC $1,060
Winter Springs $518 Winter Park $1,110
Altamonte $600 Toho Water $1 , 140
Maitland $900 Mt. Dora $ 1 ,290
Seminole Co. $990 Winter Garden $1,3 10
Lake Mary $1,010 Ocoee - new $1,379
Clermont $1,023 Oviedo $1,500
Orange Co. $1,058 Apopka $2,100
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Ocoee vs Central Florida
Sewer
Winter Garden $2,035 Lake Mary $2,535
Seminole Co. $2,100 Orlando $2,537
Casselberry $2,137 Winter Park $2~ 700
Winter Springs $2,199 Maitland $2,890
Altamonte $2,255 Clermont $2,918
Toho Water $2,316 Oviedo $3,240
Mt. Dora $2,468 Apopka $3,324
Orange Co. $2,504 Ocoee new $4,089
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Future Projects
4- Upgrade WWTP Capacity
~ Upgrade Lift Station No.1 (Nicole Blvd)
~ Upgrade Gravity Sewer Along Wurst Road
~ Northwest Area Expansion Inclusion
4 Upgrade WTPs Operations
~ Upgrade Water Mains in Existing Areas
~ Reuse System Expansion
,
CONCLUSIONS
~ The Public Utilities Department proposes
to utilize paragraphs 173-21 and 173-37
as stated in Chapter 1 73 and bring the
escalation clause forward from 1992 to
Charges
the
present and increase the Capital
by the 42.73% factor as taken from
ENR Construction Cost Index.
.~~