Marco Island to get bids for private management of city-owned utility

In this June 2010 file photo, minutes after Marco City Council discusses finding an outside firm to manage the city-owned utility, its current director, Rony Joel, accepts a 1st place award among utilities in the state for allowing the least amount of pollutants from the wastewater plant into the waterways.

Photo by KELLY FARRELL, Staff

In this June 2010 file photo, minutes after Marco City Council discusses finding an outside firm to manage the city-owned utility, its current director, Rony Joel, accepts a 1st place award among utilities in the state for allowing the least amount of pollutants from the wastewater plant into the waterways.

— A discussion about making utility rates more equitable on Marco Island Monday afternoon turned to a proposition for the city to get bids for private management for the city department instead.

City Council has charged an ad hoc utility committee with developing a new water and wastewater rate structure to make costs among different customer types more equitable.

Wastewater rates are particularly inequitable when comparing single family users with condominium users, said Ken Honecker, the committee chairman.

Council didn’t decide on the best approach to adjusting the rates, but provided its general consensus that a combination of a higher base rate, which is the monthly charge that stays the same regardless of usage, and charging a minimum usage, such as 4,000 gallons of water monthly, were among their preferences.

A recommendation by resident Monte Lazarus, who serves on the Planning Board and has served on several other city and community committees, was heeded by the majority of council members.

Lazarus suggested the city get bids from consultants to offer increased efficiencies in the plant’s operations and get bids to hire a private firm to manage the utility. The utility, now managed by Director Rony Joel, has an annual budget of approximately $48 million and was purchased by the city from a private firm, Florida Water Services, in 2003.

Council members Chuck Kiester, Jerry Gibson, Chairman Frank Recker and Larry Magel each expressed a level of interest in Lazarus’s recommendation.

Residents in attendance questioned if council was getting off topic and delaying a controversial decision on long-standing inequities.

“You can’t eat an elephant all in one bite,” said resident Roger Hall.

Hall maintained that inequities needed to be addressed no matter who managed the utility, adding that discussions of selling it was just smoke.

“We’re contracting the operation. We’re not selling it ... yet,” Magel said.

“This is thorough analysis not getting caught up in smoke,” Recker added.

Councilman Bill Trotter suggested the committee and council still work toward addressing inequities by October.

Gibson was concerned that rate structure changes were being rushed and could perhaps wait another year. In the meantime, he suggested moving forward with Magel’s preference to hire a consultant to offer potential utility operations savings and Lazarus’s proposal to get bids on the management of the utility.

“We’re going to continue on with what we know are inequalities now for another year?” Kiester asked rhetorically. “Heck no.”

The committee is to move forward with suggesting rate structure changes while bids for a consultant and a management firm are also to be sought, per general consensus during the workshop.

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Comments » 28

MarcoJimbo writes:

I've said it before and believe its worth repeating. Marco Island Utilities should be reorganized into a member-owned, not-for-profit cooperative along the lines of Bonita Springs Utilities and LCEC. Current management operating under the authority of an elected Board of Trustees would assure us the lowest rates and highest efficiencies possible while avoiding the current politicization and potential problems of private management. Lots of luck getting such a proposal past those who would stand to lose power and influence. Jim Wilson

ajm3s writes:

in response to MarcoJimbo:

I've said it before and believe its worth repeating. Marco Island Utilities should be reorganized into a member-owned, not-for-profit cooperative along the lines of Bonita Springs Utilities and LCEC. Current management operating under the authority of an elected Board of Trustees would assure us the lowest rates and highest efficiencies possible while avoiding the current politicization and potential problems of private management. Lots of luck getting such a proposal past those who would stand to lose power and influence. Jim Wilson

I second.

bigdog1970 writes:

in response to ajm3s:

I second.

I disagree. Do you honestly think the citizens of Marco receive the lowest rates possible or the highest efficiencies possble from LCEC?

Fossil writes:

I'm with MarcoJimbo and ajm3s on this one.

bigdog1970: LCEC does a pretty good job and they give much value for our dollars. Majority of customers appear to be satisfied with the services provided and general satisfaction cannot be ignored when considering alternatives. Attention to maintaining service during frequent climate and enviornmental threats are important factors to consider. I personally feel they do a better job in maintaining costs and providing services when put up against the City run utility or the local competition.

blogsmog writes:

Although it sounds interesting, you know Lazarus being a syndicate member has cards that he ain't showing...tread lightly council.

u2cane writes:

Klab, how can you say that about government and be a big fan of Obama? That is what he and the dems are all about, bigger government.

multi_million_heir writes:

Are they talking about the manpower or the entire system including maintenance, upgrades etc.? If it is just manpower, bring in employees on subcontractor terms and eliminate the overhead. If we turn over the system, we will be revisiting the last 5 years of issues when we get it back.

MarcoJimbo writes:

in response to bigdog1970:

I disagree. Do you honestly think the citizens of Marco receive the lowest rates possible or the highest efficiencies possble from LCEC?

Do you honestly think the citizens of Marco would recieve the lowest electric rates from Rony Joel & Co. (as they tried to hoodwink us into a year-and-a-half ago)? Let's compare MIU water & sewer rates to BSU. MIU water base= $27.90, water usage= $3.48/1000 gal. MIU sewer base= $22.75, sewer usage= $4.50/1000 gal. Then they tack on the 14% STRP surcharge. BSU water base= $11.88, water usage= $3.57/1000 gal. BSU sewer base= 27.81, sewer usage= $3.61. No STRP surcharge. I honestly think the citizens of Marco Island can do better. Jim

JoeFubietze writes:

Oh, this whole issue is laughable on so many levels. It is like WTF is going on here?

Okay, big bet for anyone out there...I bet that a certain ex-councilperson will be the first to bid on and get this contract. Hmmmm, I'll bet you are all wondering who I am thinking of. He used to work for big utility. He is THE person that pushed the hardest for the city's over-priced purchase of this utility. And unless I am mistaken he still has his own utility consulting, etc. business. Give you one more hint, his name starts with John and ends with Arceri.

ajm3s writes:

in response to Fossil:

I'm with MarcoJimbo and ajm3s on this one.

bigdog1970: LCEC does a pretty good job and they give much value for our dollars. Majority of customers appear to be satisfied with the services provided and general satisfaction cannot be ignored when considering alternatives. Attention to maintaining service during frequent climate and enviornmental threats are important factors to consider. I personally feel they do a better job in maintaining costs and providing services when put up against the City run utility or the local competition.

We are in agreement, especially when considering the alternatives. Unless bigdog1970 has other alternatives to make the claim that there are better value alternatives.

Marconian writes:

Wow, I can not believe how Naive this thought of a contractor taking over Operations would in anyway lower costs.
minus the strp % involved looking at the numbers from BSU compared to MIU Not much difference in essence. Its not the cost of Operations that is sinking the ship right now so to speak. whats Costing money is all the upgrades and expansions underway as Needed in order to bring the plant up to capacity and operating expectation and the thought that an outside organisation controlling Operations is going to make that go away is just ludacris and should be an after thought!
Come on!!! what are you guys thinking the cost to operate or manage is not the issue! Now that the plant is close to capacity and operation completion your going to let an outside contractor come in take over management! They still will be taking on the upgrades which still cost money and then so close to the end of these said upgrades they sit and shine when its done! And when those cost go away and It gives a false appearance as if they did something great! its pure BS! come on marco for once finish what you start let the Hard working staff of this city do their Job! For once cant you see that all the stones being thrown around city hall are more damaging than good! think before you cut the limb you stand on!

Stilllaughing writes:

Here you have "Golden Parachute" Lazarus pitching the idea of getting outside sources to run MIU. Considering the poor track record and lack of public support for our overpriced Director of Public Works, this sounds like it could be a popular idea. In fact, I'm amazed he hasn't been fired yet.
That's just what Lazarus and his boyfriend Arceri are betting on. People are fed up with the exorbitant water & sewer rates and they see another window of opportunity to fleece us again.
You can count on them being tied in to one of the consultant or management firms.
Sounds like a better deal for them. Just fire Joel and find someone competent.

ajm3s writes:

in response to Marconian:

Wow, I can not believe how Naive this thought of a contractor taking over Operations would in anyway lower costs.
minus the strp % involved looking at the numbers from BSU compared to MIU Not much difference in essence. Its not the cost of Operations that is sinking the ship right now so to speak. whats Costing money is all the upgrades and expansions underway as Needed in order to bring the plant up to capacity and operating expectation and the thought that an outside organisation controlling Operations is going to make that go away is just ludacris and should be an after thought!
Come on!!! what are you guys thinking the cost to operate or manage is not the issue! Now that the plant is close to capacity and operation completion your going to let an outside contractor come in take over management! They still will be taking on the upgrades which still cost money and then so close to the end of these said upgrades they sit and shine when its done! And when those cost go away and It gives a false appearance as if they did something great! its pure BS! come on marco for once finish what you start let the Hard working staff of this city do their Job! For once cant you see that all the stones being thrown around city hall are more damaging than good! think before you cut the limb you stand on!

Interesting and couple with JoeFu comments regarding Mr. Aceri, we have an interesting play. I guess we must maintain vigilance, for the interests of the citizens and watch the show.

MarcoJimbo writes:

Marconian: FYI Bonita Springs Utilities is in the process of elinating septic tanks and hooking everyone up to sewer, they just aren't charging $18-20,000 each plus a billing surcharge to do it. That stench in the air ian't the wastewater plant, it's the Public Works Director's office.

deltarome writes:

the comments by the marco mafia to have "someone" provide an alternate for running the waste water and water plant is just to delay or eliminate the elimination of the present "bargain" master meter condo's and hotels get relative to prices individual metered condos and single family homes get.
Marco Mafia just want to preserve their power base at the expense of those paying more than their "fair" share.
The whole review by the UAB is revenue neutral, which means that the city gets the same amount of income for the same amount of service.
They just want to delay their advantage for another year or longer by all the talk of extensive public hearings and privatization of the waterworks. The costs of running the plants are 80% fixed costs-mostly chemicals, electricity and debt service, not payroll and overhead.
How is anyone else going to reduce those fixed costs enough to justify their profit margin?
They can't so after paying consultants and companies to provide quotes, we end up at same place we started..only more indebt.

lauralbi1 writes:

I just hope that the Committee is doing the research and calculating to determine what the term"equitable" means. I would like to know what the coast was and what the cost is to deliver water to a condo versus a home and what the cost was and is to take wastewater away from a condo versus a home.

Then, and only then in my opinion), can City Council determine what is fair and equitable as to the fees that are charged to each type of living unit. There are many opinions that have been expressed, but the cost differences, both historic and present, are significant. And I for one, would like to know the facts.

And what possibly could be wrong with looking into other means to manage our utility. Private firms have proven that they can do trash service cheaper than Public agencies, why not Utility Management ?? At least let's get free bids and free Management proposals and see what the results are.

Closed minds or pre-determined negative opinions do not have any place in improving our future.

Ed Issler

ajm3s writes:

in response to deltarome:

the comments by the marco mafia to have "someone" provide an alternate for running the waste water and water plant is just to delay or eliminate the elimination of the present "bargain" master meter condo's and hotels get relative to prices individual metered condos and single family homes get.
Marco Mafia just want to preserve their power base at the expense of those paying more than their "fair" share.
The whole review by the UAB is revenue neutral, which means that the city gets the same amount of income for the same amount of service.
They just want to delay their advantage for another year or longer by all the talk of extensive public hearings and privatization of the waterworks. The costs of running the plants are 80% fixed costs-mostly chemicals, electricity and debt service, not payroll and overhead.
How is anyone else going to reduce those fixed costs enough to justify their profit margin?
They can't so after paying consultants and companies to provide quotes, we end up at same place we started..only more indebt.

So is the rate discrepancy between Bonita and Marco based on these fixed costs, if so, did we just pay above market prices for these fixed cost to account for the disparity, or am I missing something.

Just asking, trying to understand.

lauralbi1 writes:

DeltaRome: I ask again, please provide the figures. I would love to see how you have based your statement " just to delay or eliminate the elimination of the present "bargain" master meter condo's and hotels get relative to prices individual metered condos and single family homes get."

We all look forward to your facts anhd statistics. Let me give you something to ponder as youi write to us all thew specific facts on the issue. There is not enough wastewater to provide reclaimed wastewater to homes. And yet, as we all know (or should), condos use wastewater for irrigation. And yet a major part of a water plant is to provide irrigation water to single family homes. How much is that worth or how much differntial does that represent ?? This, not even including the fact that, on a per unit basis, condos use significantly less water (irrigation and pool) than single family homes. I am not making any conclusions. I just want to know the cost differentials and/or impact of the differences on rates, if any.
I look forward to you providing us the facts and figures in keeping with your conclusion above.

How much does the Utility pay to have a meter person check 100 meters versus checking 1 at a condo ??

Ther are many more questions that need answers. Please fill us in.

Ed Issler

deltarome writes:

Ed, for example, a single family home and a metered condo pay mid $20 a month regardless if they flush the john or not. A master metered condo pay as little as $4. Is that "Fair and Equitable"?
Master metered Condo's are given a 20% discount on the base rate relative to a single metered condo to reconcile the cost savings of reading one meter.
Reuse water is a commodity. It is presently sold to hotels and condos along Collier Blvd at 40% of the price homeowners must pay for water to irrigate their lawns. The reuse water is presently sold at less than cost, just to get rid of it. Since it is so cheap, it is being shipped off the island to water the new blvd medians north of marco. As the demand for reuse water increases, so will the price as during off season, more expensive water is sold at a loss to feed the demand for reuse water.
Again, the inequities are being worked out of the system.
Go to one of the future public hearings on this and get the facts before you take a position that is undefendable.
Ed, you need to relax and open your mind up to the obvious inequities and avoid jumping to conclusions.

lauralbi1 writes:

dELTArOME: You asked above, Is It fair ?? Assuming that your charges are correct, I ask, How much did it cost to deliver the water to that Condo Building as opposed to that home ?? I do not know the answer. How much of the Treatment plant is allocated to the home versus the condo ?? I do not know the answser. But I sure am curious.
Ed Issler

blogsmog writes:

'and soon after Joel accepted the award, British Petroleum was given an award for helping to clean up the gulf oil spill'

deltarome writes:

Ed, you own a single family home. Is it fair that you pay 4X the base sewer charge than a master meter condo does?
An individual water metered condo pays same sewer base charge as a single family home.
Those friends of yours in the older master metered Condos are the same ones who stuffed the ballot boxes and eventually forced the city to hook up all the single family houses on the island.
Maybe you should go to one of the public hearings that are going to be held on the subject. In the meantime, learn how to spell or get a new pair of glasses.

sailingalong writes:

Arceri couldn't steal track K for his power company so now he has set his sights on our utility district. Support and encourage the retention of Ronny Joel to insure that the utility is grossly mismanaged, then step in with your own company to take it over when the citizens get fed up.

Arceri already has Walduck and Gibson in his pocket. Recker and Magel have proven to be independent. He needs to replace Trotter and Recker at the next election and it will be a slam dunk. Lazarus doesn't do anything that Arceri doesn't orchestrate

lauralbi1 writes:

No, I think it is more a matter of typing skills, which I admit to being poor. Also, I do not have the time to dedicate to proofreading my thoughts as you may have. I wrote those blogs from an Air Force Base in Japan where I was working
Ed Issler

blogsmog writes:

(This comment was removed by the site staff.)

lauralbi1 writes:

Boy, I must have really hit a nerve. Do you people really think that your personal comments are relevant or taken seriously ?? I have said this on many occasions that I read these blogs for humor more than any other reason. There are definitely cost differences and those differences will come out before any action is taken. Let's get back to the subject of thew article looking at alternative ways to possibly save money in providing City Services.
You can choose to make this personal, but it just shows how little you have to contribute to the discussion of the actual issue.
I can assure you that Council will look at all aspects of this subject, including costs, before making any decisions. That is only logical and responsible.
By the way, please read my blogs above and show me where I refer to any facts and figures. I actually am seeking the facts and figures on this topic.
It costs a lot less to deliver water to condos than to single family homes in capital expense. It costs a lot more in plant capacity to deliver the water needs of a single family home than a condo. Let's let the experts decide what those numbers are and make adjustments accordingly.
Ed Issler

ajm3s writes:

Ed:

"It costs a lot less to deliver water to condos than to single family homes in capital expense. It costs a lot more in plant capacity to deliver the water needs of a single family home than a condo."

Is that a question looking for the facts, or is that a fact? What is a lot less vs a little less in capital expense?

Are the experts that you suggest the same experts that I heard recommend a CRA/TIF model for addressing blight on Marco Island?

Sometimes we have to separate the experts from the salesmen selling their wares. Last time a spoke to an expert, I had to pay him several dollars to represent my cause, and guess what, the opposition had their expert as well. Geez, what is one to do? Experts for hire.

happy6 writes:

ed...what are you working on in japan? and if you read for humor then why in the world do you respond? why not just admit you are always with the arceri/joel/moss/gibson/walduck/trotter/lazzarus
bunch of cronies?

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