07/21/2011 - Minutes RECEIVED
OCT 172011
Salt Lake City CITY RECORDER
Public Utilities Advisory Committee
Minutes
July 21, 2011
The Public Utilities Advisory Committee meeting was held at 7:00 a.m. July 21, 2011 at 1530
South West Temple, Salt Lake City, Utah. Committee members present were Jan Striefel, Dick
Gaddis, Dwight Butler, Dixie Huefner and Larry Myers. Committee member Allen Orr was
absent. Salt Lake City Public Utilities employees present were Jeff Niermeyer, Jim Lewis,
Florence Reynolds, Chuck Call, Bob Sperling and Zee Smith. Also in attendance were Holly
Hilton, SLC Mayor's Office; Lehua Weaver, SLC Council Office; Rusty Vetter, SLC Attorney's
Office; Keith Larson, Bowen Collins & Associates; Trevor Lindley, J-U-B; Karen Nichols,
HDR; and Mike Wilson, MWDSLS;
Approve Minutes of May 26, 2011 Meeting
Committee member Dick Gaddis moved and Committee member Larry Myers, seconded the
motion to approve the minutes of the May 26, 2011 meeting as amended. All members present
voted aye.
Financial Report—Jim Lewis
Mr. Jim Lewis briefed the Committee on the financial report for the period ending June 30, 2011.
Mr. Lewis stated that all three funds ended the year in good financial position, even with the wet
weather. He did state that the following financial reports are currently in draft form as the
accounting section has not closed the official books for June at this time. He stated that the
department had budgeted for the water year equal to last year and it looks like that is exactly
what we were given. The Water Utility ended the year with water sales very close to last year.
Mr. Lewis presented a slide showing water delivered month by month for the past eight years.
The chart showed the increases in September and October deliveries and the drop in spring water
deliveries for both this year and last. He also presented the water conservation chart for the
current year, which shows water savings due to the wet spring. The chart shows that due to the
wet spring we should meet our conservation goal for the calendar year.
The next slide presented was a comparison of revenue for all three funds versus budget. Mr.
Lewis stated that all three funds are higher than last year due to rate increases in all the three
funds on July 1, 2010. The Water Utility ended the year $3.2 million higher than last years,
Stormwater at $1.4 million higher than last year and the Sewer Utility was $237,000 above last a
year, but slightly below expectations. This shows that the economy has not recovered yet, with
most of the large industrial customers reducing production and limiting the amount of water used
and discharged into the sewer system.
The next slide presented was a comparison of operating costs, comparing last year with the
current budget amounts. Mr. Lewis stated that operating cost for the Water Utility is above last
year by $1.3 million, which relates to the purchase of more water and higher prices from the
Metropolitan Water District. The Sewer is above last year by $1.1 million and the Storm Water is
just slightly below last year by $54,104. The Department has been doing a very good job of
controlling expenditures over the last couple of years.
The last slide presented listed the capital improvements for each of the funds compared to
budget. The Water Utility has expended over $11 million in capital improvements with $5
million encumbered at the end of June. The Sewer Utility has expended $11 million with $10
million encumbered. The Storm Water Utility has expended $1.5 million with $8 million
encumbered.
Water Task Force Issues—Rusty Vetter
Mr. Rusty Vetter informed the Committee that the Department is monitoring several groups that
are involved in water-related policies and legislative activities. They are the Water Coalition, the
Executive Water Task Force and the Legislative Water Task Force. For this year, the backdrop
for much of the activity for these groups will come from three recent Utah Supreme Court cases
Tolton vs. Sandy City, Jensen vs. Jones and Salt Lake City vs. Big Ditch. All three of the groups
are going to be actively considering the consequences of these three Supreme Court decisions.
The Legislative Task Force is also focusing on water-project financing and water company
shareholders rights. The Executive Water Task Force will monitor the proposals of the
Legislative Tasks Force and also be coming up with its own legislative proposals concerning the
proper role of the State Engineer. The Water Coalition largely serves to support the other two
groups.
Saratoga Pump Station Update—Rusty Vetter
Mr. Rusty Vetter updated the Committee from a prior Public Utilities meeting where the
Committee provided a recommendation for the transfer of property associated with the Board of
Canal Presidents (BOCP) business activities at the mouth of the Jordan River. The City has been
a member of the BOCP for over a hundred years and intends to continue with the new
organization that is called the Utah Lake Water Users Association, Inc. The transaction recently
closed and the Association has been formed. The organizational meeting of the Association is
scheduled for August 9, 2011.
Lighting Utility— Sub Committee Schedule—Jim Lewis
Mr. Jim Lewis wanted to update the Committee on the Mayor's effort to establish a street
lighting enterprise fund. If established, the enterprise fund would pay for capital improvements, N
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maintenance, and operations of Salt Lake City's roughly 17,000 street and decorative lights. The bc
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City Council has identified addressing street-lighting issue as one of the Council's priorities for
2011.
The Department has hired Red Oak Consulting of Denver to conduct a street lighting enterprise
fund study. The company will work with two other companies to complete the study. The
Department is expected to have negotiated a contract with Red Oak Consulting by July 19, and
consultants are scheduled to start work on July 25. There would be four meeting times with an
appointed citizen group of about 20 people between August 15 and November 24. They will
present study findings and options to the Public Utilities Advisory Committee in November, and
study findings and options to the City Council on December 6.
Mr. Lewis asked for Committee members who would be willing to be part of a Sub-Committee
for the Lighting Utilities. Committee member Jan Striefel, Dixie Huefner and Dwight Butler
volunteered.
League of City & Towns—Sewer/Water Lateral Warranty Program Option
Jeff Niermeyer
NLC Service Line Warranty Program has a service that they want Salt Lake City to endorse.
The company was originally formed in 1998 within Columbia Energy to provide service line
warranties for its utility customers. Utility Service Partners (USP) was formed in September
2003 to purchase Columbia Service Partners from Columbia Energy. USP continues to expand
the product offerings and grow the business through city and utility partnerships. USP is a proud
member of the Better Business Bureau.
NLC Service Line Warranty Program will be introduced throughout the contiguous United States
in phases over the next 18 months. USP would mail each resident a campaign letter which
outlines the cities' endorsement, followed by a reminder letter two weeks later to ensure the
highest response rate. USP only solicits through direct mail—no telemarketing is ever employed.
All homeowners will have the option to enroll in the program, regardless of the age of their
residence.
USP desires to enter into a co-branded marketing services agreement with each city. The
agreement provides for the use of the city's name/logo, in conjunction with USP's logo on
marketing materials sent to citizens.
Each warranty is sold separately and the price range is generally between $4 and $5 a month per
product. While costs for water line and sewer line repairs can vary, the average cost of repairing
a broken water line or sewer line may range from $1,200 to over $3,500. USP pays for all
marketing materials and program administration. Furthermore, USP will pay the city a royalty
for every resident that participates in the program! By endorsing the USP programs, the city is
able to reduce residents' frustration over utility line failures by bringing them low-cost service
options.
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USP administers the program and is responsible for all aspects of the program including
marketing, billing, customer service and performing all repairs to local code.
USP asks each city to work with USP to provide the following; 1) a copy of the city seal, if
available for the solicitation letterhead 2) the city's return address for outer envelope (this
ensures a high open-rate) 3) the name, title and signature sample of the designated solicitation
signor and 4) the appropriate zip codes of the city to allow USP to purchase a mailing list of the
residents. A press release provided by USP and issued prior to the first mailing will help alleviate
citizen concerns, which should result in minimal calls to city hall.
All customers receive a set of terms and conditions upon enrollment in a utility warranty
program. They have 30 days from the date of enrollment to cancel and receive a full refund.
The external water warranty covers the underground service line from the point of connection to
the city main line to the water meter. It also covers the underground service line between the
water meter and the exterior foundation of the home. If any part of the line is broken and leaking,
USP will repair or replace the line in order to restore the service. Coverage caps listed in the
terms & conditions are per occurrence as follows: $4,000 plus an additional $500 for public
sidewalk cutting, if necessary.
The external sewer line warranty covers the underground service line from the point of
connection to the city main line to the point of entry to the home. If any part of the line is broken
and leaking, USP will repair or replace the line in order to restore the service. Coverage caps
listed in the terms & conditions are per occurrence as follows: $4,000 plus an additional $4,000
for public street cutting, if necessary.
Unlike some other warranties available, they provide you with the full coverage per incident.
They will pay up to your coverage amount each and every time you need them. They do not
deduct prior repair expense from the coverage cap or limit the amount that needs to be paid
annually.
USP will provide basic restoration to the site. This includes filing in the holes, mounding the
trench (to allow for settling) and raking and seeding the affected area. Restoration does not
include replacing trees or shrubs or repairing private paved/concrete surfaces. This is outlined in
the terms & conditions sent to the customer.
If the line is broken and leaking, USP will repair or replace the leaking portion of the line
according to the current code. However USP is not responsible for bringing working lines up to
code that are not in need of repair.
Program participants call a toll-free USP number to file a claim. USP selects the contractor, who
is required to contact the customer within one hour of receiving the job to schedule a time to
begin the repairs. Typically, repairs are completed within 24 hours. Emergencies receive priority
handling.
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USP only selects contractors who share the commitment to excellence in customer service.
Scorecards are maintained for each contractor, tracking the customer satisfaction rating to work
performed. Customer feedback is shared with the contractors and any contractor with a low
customer satisfaction rating is removed from the network.
Committee member Dick Gaddis made a motion to pursue more information on this warranty
program and bring it back to the committee. Committee member Dixie Huefner seconded the
motion, with all members present voting aye.
Adjourn 8:00
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