HomeMy WebLinkAboutItem 5: Metropolitan Wastewater Management Commission Budget
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UGENE ITY OUNCIL
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Action: Ratification of the Metropolitan Wastewater Management Commission
(MWMC) FY10 Regional Wastewater Program Budget and Capital Improvements
Program
Meeting Date: May 11, 2009 Agenda Item Number: 5
Department: Public Works Staff Contact: Lori Davis
www.eugene-or.gov Contact Telephone Number: 682-8603
ISSUE STATEMENT
This agenda item relates to the ratification of the FY10 budget for the regional wastewater program
serving the Eugene/Springfield metro area, as established under the 1977 Intergovernmental Agreement
(IGA) between the City of Eugene, City of Springfield, and Lane County. The regional wastewater
program is managed by the Metropolitan Wastewater Management Commission (MWMC) pursuant to
the provisions of the IGA. The regional wastewater budget provides funds for all operations,
maintenance, administration, and capital project management and implementation for the
Eugene/Springfield Water Pollution Control Facility, the Biosolids Management Facility, the Biocycle
Farm, the Reclaimed Water Facility, and regional wastewater pump stations.
BACKGROUND
The purpose of the regional wastewater program is to protect public health and safety and the environment
by providing high quality wastewater management services to the Eugene-Springfield metropolitan area.
The MWMC and the regional partners are committed to providing these services in a manner that is
effective, efficient, and which meets legal requirements and customer service expectations.
Since the mid-1990s, the commission and regional wastewater program staff have worked together to
identify the following key outcomes which focus on what the fiscal budget will serve to accomplish:
1.High environmental standards;
2.Fiscal management that is effective and efficient;
3.A successful intergovernmental partnership;
4.Maximum reliability and useful life of regional assets and infrastructure;
5.Public awareness and understanding of MWMC, the regional wastewater system, and MWMC’s
objectives for maintaining water quality and a sustainable environment.
These key outcomes, or goals, are in direct alignment with the Eugene City Council Goals.
Every year, the MWMC develops a budget that covers resource needs of the operations, maintenance,
and capital improvement activities for the regional wastewater program. These activities are divided
between Eugene and Springfield, and the regional budget combines the portions of the City of Eugene
and City of Springfield budgets that are dedicated to the regional wastewater program. The commission
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conducted a public hearing on the proposed draft budget for FY10 and subsequently adopted the budget
on April 10, 2009. The commission’s adopted budget is attached for council consideration (see
Attachment A). The budget reflects the continuing focus on design and construction of capital
improvements in the approved 2004 Facilities Plan, needed to ensure that the operation of the Regional
Wastewater Facilities meets increasing environmental regulations and that collection and treatment
capacity will be available to provide for growth in the service area. The adopted budget includes the
financial resources necessary to support the regional program with a 1% decrease in administrative costs
and a 7% increase in operations and maintenance (O & M) expenses. The decrease in administrative
costs is due to staffing reductions. The increase in O & M costs are due primarily to increases in
chemical costs related to changing disinfection processes, implementation of Phase III at the Biocycle
Farm, and fleet operating charge adjustments.
During the April 10 meeting, the commission approved an overall 18% increase in the regional
wastewater user rates to generate revenue for the proposed budget and, pursuant to the recommendations
of the MWMC financial advisor, to address needs for future Capital Improvement Program (CIP)
financing consistent with the commission’s Financial Plan policies and net revenue objectives. The 18%
user rate increase is driven mainly by the need to meet the revenue to debt service covenants related to
the issuance of revenue bonds in support of the regional wastewater CIP. The revenues generated by the
user rate increase are consistent with the MWMC's approved financial plan to maintain an unenhanced
credit rating of A and adequately fund operations, administration, capital financing, and reserves. In a
related action, the council approved a resolution on April 27, 2009, which expanded the commission's
borrowing authority to allow for additional borrowing to complete the 2004 Facilities Plan.
RELATED CITY POLICIES
This action item is related to the City Council goals of "Sustainable Development" and "Effective,
Accountable, Municipal Government."
COUNCIL OPTIONS
1. Approve motion to ratify the FY10 MWMC budget.
2. Return the FY10 MWMC Regional Wastewater Program Budget and Capital Improvements
Program to MWMC with specific requests for modification and reconsideration.
CITY MANAGER’S RECOMMENDATION
The City Manager recommends ratification of the proposed FY10 MWMC Budget and Capital
Improvements Program.
SUGGESTED MOTION
Move to ratify the FY10 MWMC Budget.
ATTACHMENTS
A. Transmittal Letter and MWMC FY10 Proposed Regional Wastewater Program Budget and Capital
Improvements Program
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FOR MORE INFORMATION
Staff Contact: Lori Davis
Telephone: 682-8603
Staff E-Mail: lori.m.davis@ci.eugene.or.us
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