Workshop to discuss the 10-Year Capital Improvement Plan.
BEAUMONT-CHERRY VALLEY WATER DISTRICT
AGENDA
ENGINEERING WORKSHOP OF BOARD OF DIRECTORS
560 Magnolia Avenue, Beaumont, CA 92223
Thursday, February 2nd, 2017
Workshop Session at 7:00 p.m.
ACTION ITEMS
1. Capital Improvement Plan
Workshop to discuss the Capital Improvement Plan.
2. Topics for Future Meetings
3. Adjournment
BCVWD 10‐YEAR CIP 2017‐2026 DRAFT
The Capital Improvement Program (CIP) is a ten-year fiscal planning tool used to identify the future capital needs of the Beaumont-Cherry Valley Water District (BCVWD/District), as well as identify the timing and method of financing those capital needs. The District, like other water agencies across California, must deal with population growth, aging infrastructure, climate change and environmental mandates, and an influx of new technologies. The reality is that infrastructure cannot simply be replaced. Upgrades are essential and necessary in order to meet customer needs at affordable rates.
Water meters, for example, must become intuitive, two-way communication devices and wells need to be built with next-generation computers in order to maximize pumping efficiencies and provide for added security. Many of these enhancements and upgrades are costly, but necessary.
The populations of Beaumont and Cherry Valley in 1980 were 6,818 and 5,012 respectively. The boom of the early 2000s saw Beaumont’s population skyrocket to 36,837 by 2010; Cherry Valley showed only limited growth to 6,279 during that same time period. Current (2016) population served by the District is approximately 51,400. Meeting the water supply demands for this rapid growth in Beaumont was and continues to be challenging.
The population served by the District is expected to nearly double by 2035. The City of Beaumont’s General Plan, adopted in 2007, had a projected build-out population of 87,200. The build-out population within the District’s Sphere of Influence (SOI) is estimated to be about 112,300 based on the District’s estimates of land use. It is for this reason that the development of a dynamic CIP is not only appropriate but necessary to meet customer demands.
The non potable water system can have a blend of recycled water, imported water and potable water. The 2 MG reservoir is located at the District’s groundwater recharge facility at Beaumont Avenue between Brookside Ave. and Cherry Valley Blvd. There are about 300 existing landscape connections to the recycled water system receiving about 1,800 acre-ft of water based on 2014 meter records.
A large part of the non-potable water system is currently supplied from Well 26, with Chromium VI levels above MCL, supplemented with potable water which is introduced into the 2 MG non-potable water tank through an air gap connection. The non-potable water system in the Tournament Hills and Fairway Canyon area is currently supplied with potable water through several interconnections between the potable and non-potable water systems.
BCVWD was awarded a facilities planning grant from the State Water Resources Control Board (SWRCB) to develop a regional facilities plan for the recycled water connection with the Yucaipa Valley Water District (YVWD). That plan also includes an analysis of recycled water from the City of Beaumont.
Water Resources and Recharge Facilities
In order to ensure adequate water supplies for the District, it is essential that the District implement a recycled water connection and supply from Yucaipa Valley Water District (YVWD) and continue discussions with the City of Beaumont for use of the City’s recycled water as soon as it is available.
Any recycled water brought in and used will immediately reduce the demand on the potable water system and reduce BCVWDs extractions from the Beaumont Basin.
Goal of the CIP
The goal is to use the CIP as a tool to implement the District’s Potable and Non-Potable Water System Master Plans, its objective of staying abreast of technology needs and trends, its operating goals, objectives and policies, and to assist in the District’s financial planning
More specifically, the District’s Capital Improvement Program (CIP) for 2017-2026 identifies the capital finance requirements for the anticipated projects for the next ten years.
These projects include the construction of new facilities to support development, new facilities to improve existing conditions or in response to the changing needs of the District and the replacement of those capital facilities and other assets that have reached the end of their useful lives. Adjustments are made to the CIP in response to changing economic conditions, land development activity, completion of new facilities or related changes to replacement projects. The District’s Ten Year CIP is planned to be updated annually for consideration and approval by the District’s Board of Directors.
The 10 year CIP also provides an analysis of current needs based on local area development rates in each pressure zone. Certain items identified in the 10 year CIP have been deferred at this time due to a lack of development progress at any particular development.
Funding Sources
There are a number of funding sources available for the CIP projects. They are described briefly below.
Capital Replacement Reserve Funds
BCVWD sets aside funds to refurbish, rehabilitate and replace aging facilities, vehicles and equipment as part of its water rate structure. These funds can be used to replace aging pipelines up to their existing size (oversizing could be funded from facility fees); rehabilitating, reconditioning, redevelopment of water wells; painting and refurbishment of tanks; and replacing and rehabilitating pumps, i.e. any project that either extends the useful life or increases the capacity or efficiency of the existing capital asset. The same funds can also be used to replace and/or upgrade District vehicles and Information Technology (IT) infrastructure and capabilities.
Direct Loans
BCVWD could initiate a conventional loan for specific projects that are either not funded from other sources or where other sources are inadequate to complete a project on a timely basis. Interest rates on this type of loan are generally higher and therefore direct loans should only be used when short term funding is necessary to complete a project or should an emergency arise.
Restricted Cash Funds from Capacity Fees and Front Footage Fees Capacity fees, sometimes referred to as facility fees or impact fees, are paid by residential, industrial, commercial and institutional developers to fund the cost of water system additions and enhancements to support growth resulting from their developments.
Capacity fees fund new wells, tanks, booster stations, pressure reducing stations, oversizing of pipelines and transmission mains needed to serve new development.
Federal and State Grants and Loans
There are a number of State and federal grant and loan programs for potable water, groundwater protection, storm water capture and recycled water projects.
For example, Safe Drinking Water State Revolving Fund (DWSRF) assists water system agencies in financing the cost of drinking water infrastructure projects needed to achieve or maintain compliance with SDWA requirements and to further the public health objectives of the Safe Drinking Water Act (SDWA). DWSRF funds do not provide funding for growth.
There are also grants and low interest loans available from the Water Recycling Funding Program (WRFP) for recycle projects. Proposition 1, the Water Quality, Supply and Infrastructure Improvement Act of 2014, has funding available for drinking water, storm water, groundwater and recycled water projects. Funding is administered by the State Water Resources Control Board (SWRCB).
Bonds
There are several types of bond funding available to the District:
General Obligation Bonds
General Obligation Bonds are repaid with taxes, usually property tax, and require a two-thirds voter approval.
This type of funding is probably not viable for the District.
Revenue Bonds
Revenue Bonds are repaid from revenue generated from water sales. Revenue bonds only require a simple majority voter approval. Since revenue bonds are backed by water revenues, Prop 218 procedures are likely to be followed. BCVWD could issue revenue bonds to fund water facility replacement and rehabilitation projects.
Read Full Report Here: http://bcvwd.org/PDF_Files/bod…