Title
Consider/Discuss/Act on Water Service Line Replacement Program
Summary
COUNCIL GOAL: Operational Excellence
MEETING DATE: March 1, 2016
DEPARTMENT: Public Works
CONTACT: Morgan Dadgostar, Water Utilities Superintendent
RECOMMENDED CITY COUNCIL ACTION: Approval of water service line replacement program
ITEM SUMMARY:
• Proposal of a ten year plan to replace approximately 14,650 substandard copper water service lines (1,440 service lines per year) in order to mitigate water loss in the water distribution system.
• With approval of this item, $1,759,647 will be used for purchasing the necessary equipment in FY2015-2016.
• Thirteen new staff will be added starting FY17, for the annual cost of 900k - 1.1 M / year and approximately $300,000/year material and maintenance cost to perform the work.
• The water service line replacement program was presented to Council at the February 29, 2016 Work Session.
BACKGROUND INFORMATION:
• The City of McKinney is required to submit yearly a water loss report in March to NTMWD and in May to the Texas Water Development Board.
• Over the past five years, McKinney has not met the 12% target for water loss.
• The most recent report indicates a 23 percent water loss (approximately 2.4 billion gallons).
• It has been determined that a substantial portion of the water loss is due to leaks from service lines made of substandard copper.
FINANCIAL SUMMARY:
• Funding for the materials portion of this project is included in the Capital Improvements Program.
• With approval of this item, $1,759,647 will be used for purchasing equipment in FY16. Funding will come from a Budget Amendment in the Water/Wastewater Fund. The Water/Wastewater Fund was budgeted in FY16 to have $1,500,000 of revenues in excess of expenses. This program will expend this surplus and an additional $250,000 of Fund Balance. Water/Wastewater Fund Balance will remain well above required reserve levels.
• Water / Wastewater Operating budget will be utilized in the next ten years, starting FY17, to fund staffing ($900k - 1.1 M / year). These funds will be appropriated using the funds currently earmarked for our Meter Replacement Program. This Meter Replacement Program will be completed in FY16 and the yearly appropriation may be redirected to this new program with the adoption of the FY17 budget.
BOARD OR COMMISSION RECOMMENDATION: N/A