HomeMy Public PortalAbout1974_06_24SPEC 1 1
WAIVER OF NOTICE
OF
SPECIAL MEETING
JUNE 24, 1974
We , the undersigned, being members of the Town
Council of the Town of Leesburg , in Virginia , do seve-
rally waive all statutory and Charter requirements as
to notice of time , place and purpose of a Special Meet-
ing of the Town Council , to be held in the Council Cham-
bers , 10 West Loudoun Street, Leesburg, Virginia, at
7 :30 P.M. , Monday , June 24, 1974 , for the purpose of
discussing water and sewer rates , and any other matter
that may come before the Council .
•
G. Dew- ill , Mayor
afar
Walter F . Mi r y Herbert L. Ridder
40,
Robert A. Orr �C.
� Ter, Titus/( / OW
i/� iil ' "'�' `r. O ' I
o W. Puma rey John A. Wallace , J /Y{
a
3t .
MINUTES OF SPECIAL MEETING OF LEESBURG TOWN COUNCIL, JUNE 24, 1974. ,
A special meeting of the Leesburg Town Council was held in . the
Council Chambers , 10 West Loudoun Street, Leesburg, Virginia on June
24, 1974 at 7 :30 P.M. , pursuant to Waiver of Notice attached hereto.
Present were the following : Mayor Hill, Councilmen Murray, Pumphrey,
Ridder, Titus and Wallace ; also Town Manager James W. Ritter, Jr. ,
Deputy Town Manager E. Wesley Devero and Town Attorney George M.
Martin. Absent from the meeting was Councilman Robert A. Orr.
Also present were some thirteen (13) builders and/or developers ,
along with Council Members-Elect Bange, Newman and Rock.
The meeting was called to order by Mayor Hill, who recognized
Mr. Harry Burt, representing Daniel A. Robinson & Associates , who
performed a study for the Town on water and sewer rates . He turned
the meeting over to Mr. Burt at this time.
Mr. Burt explained that this study was performed for the purpose
of laying out an estimate of costs for the water and sewer systems of
Leesburg sufficient to permit the setting of rates , fees and charges ,
and to aid in calculating the utility system budget each year for the
O next five fiscal years . The configuration assumed is the regional
CD utility system recommended by the NVPDC and preferred by the Town.
He explained in detail the basis for the availability fees set by the
Town after the issuance of the sewer moratorium - this being a "front
end" payment by the developers as they used capacity in the proposed
Ca new plant. He found this system to be equitable . He pointed out that
this study looks to the year 1990, although the planning horizon for
the Budget is for five years only. The Water Pollution Control Act
provides that the system must be cost-effective and Federal Grants
are based on this provision.
•
Mr. Burt then went on to explain various exhibits and tables in
the Report, with his first recommendation being to change the water
and sewer rate charges to the consumer from a block rate structure
to a flat rate for water consumption at 80 cents per thousand gallons ,
along with a minimum charge of $2 .00 per utility bill - this to cover
administrative costs of the system. Sewer charges at 100 per cent of
the water gallonage charge are recommended to be continued, this then
being in conformance with the Water Pollution Control Act.
He explained in detail Table 6 of the Report, which has to do
with the calculation of availability charges , with his recommendation
being that the total of both water and sewer connection fees be
$1,500 per unit. He further recommended that, since the bond reso-
lutions speak to operating the two systems together, the charge should
be $750- each• for water and sewer in those cases where connections are
made individually.
•
There was discussion at this time on this portion of the report.
In answer to Mr. Shor 's question concerning the inflationary factor,
Mr. Burt said this portion of the report is in 1974 dollars - infla-
tion will be dealt with• later in the Report. Councilman Titus asked
how you would handl#t2r500 available sewer connections when there are
only 7600 available connections. Mr. Burt replied that, when the
Town has used up the 3 million gallon permit from the State of Maryland,
it would either have to seek a larger permit and expand the Plant or
start using the wells again, or get some other source of supply. Mr.
Jennings asked if the difference in flows had been taken into con-
sideration for multi-family dwellings , commercial and industrial users.
Mr. Burt replied that these figures have been factored in on an averaged
out basis in terms of dwelling units or their equivalents , which basi-
cally means the same gallonage . The apartments , etc . are using about in
the same range as a single-family house . Mr. Silverman said he had
figures from Loudoun County showing the average number of persons to
a dwelling at 2 .35 in multi-family dwellings . He questioned the consis-
tency of using a constant factor for this . Mr. Burt said the purpose
of this study is to show that, when you buy out capacity, it permits
you to handle these "shocks" from the Water Control Board. With fur-
ther refinement, such a scale could be developed, however, he has not
been able to carry the investigation into great detail, but he has
checked 3 or 4 apartments in Leesburg and their consumption figures
per unit are about the same as a single-family dwelling, so he has
made no distinction .
Q� 4
MINUTES OF SPECIAL MEETING, JUNE 24, 1974.
Mr. Bua then continued with explanation of his Report, citing
the projectid op@ raating ipcome for the next five years and a five-
. year operating plfHi. / RR5Ehditures and debt service both increase
more rapidly than operating income , therefore; making the assump-
tion that operating expenditures have to at least be covered by
operating income, he would recommend another rate increase in 1980,
even without inflation . Furthermore, the debt service, which is
:expected to be carried by the"front end"money coming in as ' the sys-
tem grows , will be increasing more rapidly than that income by 1978.
There are several different ways of handling this , but his recommenda-
tion is to' re-evaluate costs as to timing of the water system expan-
sion, especially Stages 2 and 3. There is no question that the new
water plant is needed, but Stages 2 and 3 may need to be strung out
longer in time.
He explained the potential effects of inflation and recommended
that construction of AWT facilities and Stage I of the water system
be moved forward as quickly as possible .
Mr. Burt then explained the formula used by Council in arriving
at the current availability fees of $1,300 each for water and sewer,
these fees being based only on filling up the capacity of the present
Sewer Plant. He then explained Table 8 - Availability Summary.
This breaks down availability at the old rate and availability at the '
new rate, and calculates what may be expected from those on various
Priority Lists , etc. , but excludes any new money coming in on the
Priority List. This summary then shows the adjustment in the event
a policy might be adopted for the return of a portion of this money.
The amount liable for refund still faces the uncertainty regarding
the configuration of a regional system, and the delay will relate to
inflation. He recommended that this study be revised when the system
settles down and some of the costs are better known, and, further,
that some interim means of handling availability payments , funds on
hand, contingent liabilities with regard to taps, etc. should be given
very careful consideration by this Council, and that this consideration
use principles of equity for the developer and control of risk for
the Town.
Councilman Titus asked the reason for the uniform rate. Mr. Burt
explained that the Water Pollution Control Act requires that sewage
charges be based on an economic basis and, since the sewer charge is
tied into the water rate, you must have a flat rate for water, in
order to be eligible for a Federal Grant.
Mr. Logan Jennings asked about the possibility of availability
fees being adjusted annually in relation to inflation. Mr. Burt be-
lieved that, theoretically, it could be done , but did not recommend
it. One of the principles of "equity" is the stability of the rates
. and adjusting theseevery year or six months might lead to as many
problems. Also, one of the problems of stability is that at some
point• in time the Grants are fixed, as well as the leverage, and
inflation is absorbed on the entire amount. Mayor Hill asked Mr.
Jennings if he were going to build 200 houses , would he not pay the
fees for all 200 to avoid any. inflation. Mr. Jennings believed that
he probably would, however, he still was in favor of establishing a
new fee each year - this way, the builder would catch it as he goes
along . Mr. William Herndon could see no benefit in buying in advance
because costs keep going up.
Mr. Sorensen asked if the Town is prepared to go along with the
recommendations in this Report. He said the members of the Builder's
Advisory Committee are definitely pleased and would like to see the
Town go along with the recommendations of Mr. Burt. Mayor Hill re-
plied that, apparently, the Council was not too far off in allocating
1 million gallons ' capacity in the Plant a little over a year ago.
However, this report takes it to the full capacity of the Plant. Coun-
„ oilman Titus said it has not been determined what percentage of the 1.3
million gallons is proposed as infiltration due to the fact that you
can 't segregate sewage from water when it gets to the Plant. Mayor
Hill added that this meeting tonight is in conformance with the Agree-
ment with Mr. Shor and he feels that this study is in line and com-
mended Mr.. Burt for an excellent job.
Included in the debt service for this five-year operating plan are
two new Bond Issues , one in 1975 for $5 .6 million dollars and one
in 1977 for $2.6 million.
315-
MINUTES OF SPECIAL MEETING, JUNE 24, 1974 .
Councilman Wallace also commended Mr. Burt for an excellent Re-
port, but felt it should be stamped "UNCERTAIN:" Until something is
resolved by the Water Control Board, the Council certainly cannot
adopt a policy to refund any portion of availability fees at this
time . We can build a water plant, but it does no good if you can '_t
sell the water.
Mr. Shor felt that this makes it a. little more tenable for the
builders and something that they can all work with. Lenders are go-
ing to look at whether the Town is going to grow and he believed that,
if the Town adopts this Report; then we can get some money and some
growth.
other
Councilman Titus said there are two/items to be considered' also :
(1) The availability of Federal monies , and
(2) The position of the taxpayers with regard to another bond
issue . You are talking about approximately $14,000,000,
less Federal Grants , and this is a lot of money to ask the
people for.
O Councilman Murray agreed completely with this - he would have
very strong reservations about a bond issue of this magnitude , based
on growth as opposed to non-growth votes .
0
C Mr. Herndonaskedwhy this availability money has to be "front
end" money before you can get a Zoning Permit. He cited the develop-
ment of 13 town houses to be built by Mr. diZerega and him - the
availability fee being $36,400 before they caneven start this project ,
which would be only four to five months work for them. He asked how
many members of Council could post $36,000. for four to five months
work. Water and sewer are not needed for these houses until they are
ready for occupancy, therefore , he could not see the need for payment
of these fees in the beginning . He pointed out that it is eventually
the buyer who is paying it. He asked that someone explain why the
Council made this requirement:
Mayor Hill explained that this is a part of the selling price
of the house and you must have water and sewer to sell it. The Town
was collecting this mbney• at various times and it became necessary
for the Council to delineate a certain stage for the Town Manager
. to collect these fees . Mr. Herndon still felt that this is too much
money for the Town. to take at the beginning and em einterest on it
when the builders are paying more iah@xeM for the/money. Councilman
Titus asked Mr. Herndon, as a builder,%/would prefer to pay it and how.
Mr. Herndon suggested when the builder is ready to do his finished
grading - the meter is not set until the sidewalk is poured, etc. Mr.
Titus commented that, once it leaves Mr. Forbes ' desk as a Zoning Cer-
tificate , there is no way of recovering this money .
Mr. Fredric Spain suggested using the Occupancy Permit issued by
the County as a time to pay these availability fees. Councilman Titus
asked how effective an occupancy permit is . Mr. Shor said it is very
effective if it is carried out properly, however, he commented at length
on the discrepancy existing in Fairfax County concerning such a permit.
Mr. Spain went on to say that, under such requirements, he would have
to pay $300,000 for 103 taps and he could not imagine anyone thinking
he could put up that kind of money before a foundation is even cut.
The builder has to borrow the money and he certainly could not see that
it is logical at all for the Town to take this money and put it in the
Bank and draw interest on it . He suggested that these fees be paid
when the taps are made and would hope that the Town would realign this
requirement. Mr. Spain also felt that capacity has been released to
the developers on the Priority List in the present 1 . 3 million gallon
plant, which was built under an old system of economics - therefore,
he did not feel that any increase in the availability fee was proper
for the use of capacity in this Plant. However, he would be happy to
sign anything that would pursue the development ariiexpansion of this
Plant.
•
Mr. Sorensen pointed out that he paid $66,500 for 21 houses in
Exeter Hills . He called for the second water meter the other day in
order to keep the bricklayers going and it took three (3) days to
check out the fact that he had paid the tap fees. The developer re-
" 3 1 6
M I N U T E S O F S P E C I A L M E E T I N G , N N E 2 4 , 1 9 7 4 . .
q u e s t s ' t h e w a t e r m e t e r t o b e s e t , s o w h y n o t , b e f o r e h & c a l l s f o r t h e
m e t e r , p a y t h e a v a i l a b i l i t y a n d t a p f e e a n d t h e n s u b m i t t h i s t o t h e
D i r e c t o r o f P u b l i c W o r k s , w h o c o n t r o l s t h e s e t t i n g o f t h e m e t e r s .
H e p o i n t e d o u t t h a t , t w o o r t h r e e m e e t i n g s a f t e r h e p a i d t h e s e a v a i l a -
b i l i t y f e e s , h e s a t a t a C o u n c i l m e e t i n g a n d w a t c h e d t h e T o w n . o p e n
b i d s f o r t h e i n v e s t m e n t o f t h e s e m o n i e s a t 9 t o 1 0 p e r c e n t . T h e .
b u i l d e r s a r e n o t g o i n g t o p u t a l l t h i s m o n e y i n t o b u i l d i n g w i t h o u t
p a y i n g f o r w a t e r a n d s e w e r . H e s a i d t h i s " f r o n t m o n e y " i s . i m p o s s i b l e
t o g e t a n d h e c e r t a i n l y h o p e s t h a t - t h e T o w n w i l l . c o n s i d e r h i s s u g g e s -
t i o n . a s a t i m e f o r p a y m e n t o f t h e s e f e e s . H e b e l i e v e d h e w a s s p e a k -
i n g f o r a l l t h o s e m e m b e r s o f t h e B u i l d e r s ' A d v i s o r y C o m m i t t e e . -
M r . S h o r s a i d h e w o u l d p r e f e r t o h a v e t h e w a t e r c u t o n a h e a d o f
" t h i s t i m e s o t h a t t h e d r y w a l l c o u l d b e t e s t e d i n h i s b u i l d i n g s , h o w -
e v e r ,
o w
e v e r , h e w a s n o t a g a i n s t t h e p r o c e d u r e s u g g e s t e d b y M r . S o r e n s e n . H e
s t i l l f e l t t h e b e s t c o n t r o l w o u l d b e b y t h e i s s u a n c e o f o c c u p a n c y p e r -
m i t s .
M r . S i l v e r m a n a s k e d w h e r e t h e c a p a c i t y w a s f o u n d f o r t h e r e c e n t
t a p s r e l e a s e d . C o u n c i l m a n T i t u s e x p l a i n e d t h a t t h e T o w n h a s b e e n w o r k -
i n g w i t h a C e r t i f i c a t e , o f 1 . 0 m i l l i o n g a l l o n s a n d t h e y h a v e n e v e r b e e n
a b l e t o d e t e r m i n e w h e r e t h e 1 . 0 : m i l l i o n - g a l l o n s i s a n d w h e r e t h e 3 0 0 , 0 0 0
g a l l o n s o f i n f i l t r a t i o n i s , s o t h e y d i s c u s s e d t h i s w i t h t h e W a t e r C o n -
t r o l B o a r d a n d t h e y a g r e e d t h a t y o u c a n ! ' t t e l l t h e d i f f e r e n c e b e t w e e n
a g a l l o n o f s e w a g e a n d a g a l l o n o f w a t e r . T h e r e f o r e , t h e y h a v e a l -
l o w e d t h e c a p a c i t y t o r e a c h t h e 9 5 p e r c e n t l i m i t .
T h e r e w a s c o n s i d e r a b l e d i s c u s s i o n c o n c e r n i n g t h e - p o s s i b i l i t y o f
a f u t u r e b o n d i s s u e , w i t h C o u n c i l m a n M u r r a y f e e l i n g t h a t t h e p r e s e n t
t a x p a y e r s w o u l d c e r t a i n l y n o t g o a l o n g w i t h " t h i s s i n c e i t , w o u l d b r i n g
m o r e g r o w t h t o t h e T o w n , a n d s o m e m e m b e r s o f t h e A d v i s o r y C o m m i t t e e
f e e l i n g t h a t i t w o u l d b e n e c e s s a r y t o k e e p t a x e s d o w n . M a y o r . H i l l
a g r e e d t h a t t h e r e s h o u l d b e n o a d d i t i o n a l b u r d e n o n t h e T o w n , b u t t h a t
f u t u r e , g r o w t h w i l l h a v e t o p a y f o r a n y c a p i t a l i m p r o v e m e n t s .
C o u n c i l m a n W a l l a c e f e l t t h a t C o u n c i l s h o u l d c e r t a i n l y g i v e s o m e
t h o u g h t t o d e v e l o p i n g a p o l i c y w h e r e b y t h e a v a i l a b i l i t y f e e s w o u l d
n o t b e p a i d a s " f r o n t m o n e y . " H e a g r e e d w i t h M r . H e r n d o n o n t h i s p o i n t
M r . S p a i n p o i n t e d o u t t h a t l e n d i n g i n s t i t u t i o n s p a y o f f i n " d r a w s "
a s w o r k p r o c e e d s o n b u i l d i n g a n d t h e y d o n o t g e n e r a l l y l e n d t h e a m o u n t
r e q u i r e d a s a v a i l a b i l i t y f e e s b y L e e s b u r g b e f o r e t h e i n i t i a l s t a r t . H e
e l a b o r a t e d o n t h e s e " d r a w s " ; t h e n i n t r o d u c e d M r . N i c k N i c h o l s o f t h e
F . W . B e h r e n s C o m p a n y . M r . N i c h o l s t h e n g a v e a b r i e f r e s u m e a s t o h o w
l e n d i n g i n s t i t u t i o n s o p e r a t e a n d s a i d t h a t , u n d e r t h e p r e s e n t c i r c u m -
s t a n c e s , L e e s b u r g w o u l d r e q u i r e s p e c i a l h a n d l i n g . M r . H e r n d o n a g r e e d
w i t h M r . N i c h o l s a n d s a i d t h a t w a t e r a n d s e w e r c o n n e c t i o n s m u s t b e m a d e
b e f o r e a b u i l d e r c a n g e t h i s f i n a l _ d r a w , : s o ; t h e . i e . i s n o w a y t h e T o w n
c o u l d l o s e o n t h i s . M r . B u r t s a i d t h i s R e p o r t d o e s n o t s p e a k t o t h e
t i m e o f p a y m e n t o f t h e s e f e e s - o n l y t h a t t h e y m u s t b e p a i d b e f o r e
t h e h o u s e i s o c c u p i e d . "
C o u n c i l m a n R i d d e r f e l t t h a t b o t h M r . S o r e n s e n ' s r e q u e s t t o p a y
t h e s e f e e s a t t h e t i m e a t h e w a t e r a n d s e w e r a r e c o n n e c t e d a n d M r . S h o r t s
r e q u e s t t o p a y t h e f e e s e a r l i e r i n o r d e r t o t e s t d r y w a l l c o u l d b o t h
b e a c c o m m o d a t e d b y t h e T o w n . _
M r . S o r e n s e n t h e n a s k e d M r . B u r t h i s f e e l i n g a s t o t h e t i m e f r a m e
" f o r a c c e p t i n g t h i s r e p o r t . M r . B u r t r e p l i e d t h a t p e r h a p s t h e T o w n
w o u l d l i k e t o a d o p t t h i s t o t h e e x t e n t t h a t i t w o u l d b e p o l i c y ' t o p r o -
c e e d t h i s w a y a s t h e w a y b e c o m e s c l e a r . T h e a d o p t i o n o f t h i s w o u l d
b e c o n t i n g e n t u p o n k n o w i n g t h e c o n f i g u r a t i o n o f t h e r e g i o n a l s y s t e m
a n d t h e c o s t s t h e r e o f a n d k n o w i n g w h e r e t h e T o w n . i s n o w , i n s o f a r a s
o l d t a p f e e s , , n e w t a p f e e s , t a p f e e s y e t t o b e p a i d f r o m t h o s e o n
P r i o r i t y l i s t s a n d a l l o f t h i s n e e d s t o b e g i v e n v e r y c a r e f u l t h o u g h t .
H e r e c o m m e n d e d t h a t C o u n c i l c o n s i d e r t h i s a s a m a t t e r o f p o l i c y o n l y
a n d t h a t t h e T o w n m o v e s l o w l y t o s o l v e t h e s e p r o b l e m s a s t h e i n f o r m a -
t i o n i s d e v e l o p e d a n d t h e r e g i o n a l s y s t e m b e c o m e s c l e a r . H e d i d f e e l
t h a t C o u n c i l c o u l d a d o p t n e w w a t e r a n d s e r v i c e r a t e s a t t h i s . t i m e ,
w h i c h w o u l d h a v e n o t h i n g t o d o w i t h a v a i l a b i l i t y c h a r g e s o r t a p f e e s .
. 317
MINUTES OF SPECIAL MEETING, JUNE 24 , 1974.- •
•
Mr. Sorensen asked if Council feels that the Town will continue
to charge $1 ,300 for availability and, if the needed information be-
comes available at a later date , would there be a possiblity of a re- -
. fund. Mayor Hill said he felt there would be no question .about this. -
However, there is the possibility that the Water Control Board could "
make a decision on this regional plant that would involve legal en-
tanglements that could, delay a decision for two to three years . Mean-
time., the- Town is locked tight and cannot make• a. move, and also being
blamed for everything. The question then arose as to who would get the
refund - the builder or the buyer. That question was not resolved.
Mayor Hill believed the time of paying availability and tap fees
brought up by Mr. Herndon is a very valid one. Mr. Spain asked if
- Council expects to consider this matter and Mayor Hill said he would
like to defer any decision until the new Council takes office on
- July 1st. Mr. Spain then requested that the Public Works Committee
consider this matter and make some recommendation at the meeting to
be held on July 10th in order that he might be able to get started on
construction by mid-July. Councilman Wallace felt that- this is too
- much 'of a burden to put on a new ,Council in less than a month after
taking office. Mr. Spain continued with his request for immediate
action to relieve the• builders who have been held up for over a year
CC now. .
Mayor Hill then asked the Town Manager and his staff to review
this situation prior to the next Public Works Committee meeting and,
if they can come up with a plan they feel is workable , present it to
the Committee for its consideration and recommendation to_ the Council
at the next meeting . He assured the group assembled that Council will
do whatever they can- to implement this problem.-
•
There being no further discussion, on motion. of Councilman, Wallace,
seconded by Councilman Ridder, the meeting was adjourned at 9:32 P.M.
May.
•
Clerk of if
e Council -