Agenda - 11-17-2015 - 6a - Minutes

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12 1 Commissioner Pelissier said Commissioner Jacobs comments sound familiar but she 2 does not recall the outcome. 3 Commissioner Dorosin asked if permission would be required from Carrboro but not 4 from Chapel Hill. 5 Bob Jessup said that is correct. 6 Commissioner Dorosin asked if the Manager could elaborate on her discussions with 7 RENA. 8 Bonnie Hammersley said she shared the draft of the memo in the packet and there were 9 no specific questions. She said RENA was supportive, and if the Board of County 10 Commissioners directed staff to go further, RENA would be involved and may have more 11 questions at that time. She said there was some skepticism but she felt comfortable when she 12 left the meeting. She said the OWASA Board had a lot of questions which will not be answered 13 until it is determined that the process should move forward. 14 Commissioner Dorosin said there must be clear communication and outreach to this 15 community as the proposed process moves forward; emphasizing that the service they would 16 receive would be same as everyone else that is served with water and sewer. 17 Bonnie Hammersley said the issue of rates did come up at the meeting and she assured 18 them that the BOCC would have some flexibility. 19 Chair McKee said he was comfortable with the district idea and lower rates. He asked if 20 the district was set up for the 86 current properties, and there are empty parcels, what would 21 happen if someone built a $500,000 home. 22 Bob Jessup said that homeowner would pay the same gallonage monthly rate, but the 23 upfront capital recovery includes a debt cost; and he said any existing structures prior to today 24 would pay 50 percent recovery costs, but charge others after a certain date a different cost. 25 Chair McKee said he is not comfortable with 20 to 30 new, high dollar homes being built 26 that the County then subsidizes. 27 Commissioner Rich said the district could be extended further to offset some costs. 28 Commissioner Pelissier said even though the same rates would be charged to 29 everyone, it would be possible to do a tiered rate for usage. 30 Chair McKee said he is uncomfortable with straight out subsidies to higher dollar homes. 31 Commissioner Jacobs said there was a similar issue with the Efland water rates. 32 Commissioner Jacobs asked if the debt that this district will incur affects the County's 33 debt capacity. 34 Bob Jessup said it would affect the debt capacity only to the extent that a break-even 35 system is not being run. He said if the capital and operating costs are being covered through 36 the rates, fees, and charges, it is invisible to the debt capacity. 37 Chair McKee asked if Bob Jessup could clarify further. 38 Bob Jessup said this would not be a general fund obligation. He said if the system is 39 operated so that it pays it owns bills, then the rating agencies will not be worried about it. 40 Bob Jessup said the Board has Attachment B, which is the chart of activities for creating 41 a water and sewer district. He said the district could borrow money and pay back funds just like 42 the County. 43 Bob Jessup said special assessments could be used to recover some of the capital. He 44 said this would involve taking a portion of the cost to run the infrastructure past a residence and 45 charge the resident to recover all or a portion of that cost. He said there is a petition process 46 where the landowner can get up to 30 years to pay off such costs. 47 Bob Jessup said the Local Government Commission (LGC) cannot require the district to 48 be self-sufficient. He said the LGC will want there to be some sort of stated policy as to 49 whether the County is seeking a self-sufficient district or a subsidized one. 50 Chair McKee said to direct staff to continue to proceed further with this process.