Council again tackles water rates
The Marco Island City Council met in a special-called meeting on Monday to discuss the island's water rate and supply issues, but announced plans to take up the subject again in May.
"I think we are putting the cart before the horse," said councilman Victor Rios when the meeting started. He said it was his belief that the meeting had been called to discuss rates, not capital needs.
Council Chairman Larry Sacher had requested the staff make a short presentation on the utility's capital needs in the coming years – and that didn't sit well with several of his colleagues.
"This meeting was supposed to be about design," said councilman Amadeo Petricca.
It didn't take councilman Larry Honig long to vent his frustration with some of the assumptions relating to depreciation of the $277 million figure that staff had placed up on the board as the value of today's assets belonging to the utility, and of the $7.1 million that would be required each year for capital projects to sustain the asset base.
"I want to be positive in this meeting but I'm off to a rough start given these numbers," said Honig.
"Presently, revenues are three times operating expenses," Honig continued. "A comparison of a 34 city average that I've done shows the largest R/R at only $4.7 million and that is Bradenton, Fla., and it has population of 50,000 and 27,000 homes."
R/R, according to the city utility, stands for renewal and replacement.
Councilman Ken Honecker attempted to bring some understanding to the spreadsheet Finance Director Guillermo Polanco gave to the council about the total of units or estimated daily usage in single-family homes, master-metered condos and individually metered condos throughout the island, while numbers would also have to be extrapolated for commercial properties.
Issue of parity
Who pays what and how it is distributed throughout the varying rate base was at the center of the remaining discussion.
Rios would consistently come back to his desire to see all users pay the same amount for each gallon they use and simplify the rate structure.
Toward the end of the three-hour meeting Honecker and Polanco walked through an exercise, using a model to calculate rates on the water side of the equation and would eventually request that the staff load in the numbers for both water and wastewater operations to review projections the staff put forward.
"I think this would be good if the city cleans up the spreadsheet and see what we get back, before we call in a consultant to confirm its validity," said Honig. "I am still uncomfortable with the $7.1 million R/R figure however."
Council members have requested another workshop be held on May 4 to continue the discussion to see if they are comfortable with the formula and structure proposed by staff.
Sacher asked City Attorney Alan Gabriel if the discussion about vacant lot assessments should be brought into the dialogue as the council spoke about rate structure. Gabriel said it would have to be dealt with at some time during the discussions.
Vacant lot assessments
Hideaway Beach residents again came forward to protest any assessments on those lots not previously assessed for the improvements and rebuilding of the wastewater treatment facilities over the last seven years.
Honecker suggested those residents be given a one-time opportunity to take advantage of the $4,610 figure, which has been used as the cost of the assessment that had been defeated, reconsidered, passed again and defeated once more – and is now up for further discussion.
Councilman Bob Brown felt a fair and equitable rate structure needs to be in place before he would entertain further consideration of the assessment.
"I'm looking for a resolution on rates before we move forward on the assessment issue," said Brown.
For Sacher the issue was simple.
"I'm looking for parity regarding this issue," said Sacher.
"We can only put so much lipstick on this pig," said Honecker as he addressed what he saw as the inequities in the rate structure.
He was supported by Batte, who also said, "The day of reckoning is here."
Council will meet again on May 4 at 1 p.m. to discuss rates in addition to pensions.