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<br /> 1,400. Once the annexation study is done, the City Council will look at that and have public hearings and
<br /> determine, by cost I do believe, whether it is feasible to put the water and sewer in those areas. As we all
<br /> know, water and sewer costs when you annex an area 100%. 1 think it is probably about half and half if you
<br /> really come down to dollar per dollar. So there is a financial cost in running water and sewer in areas. So, as
<br /> far as doing our study, it is not a study for boundaries for growth. Our agreement that we have with Orange
<br /> Alamance Water System indicated we do a 20-year plan growth area several years ago with the City of
<br /> Graham. And in those areas, if water is needed, we would subsidize water based on growth areas. So that's
<br /> our agreement with Orange Alamance Water System. Orange Alamance Water System has helped us in the
<br /> past and given us water. We do work well with those folks, and hopefully anybody; and I think everybody in
<br /> this room would say, If we can service someone that needs water, we will try to do so to the best of our
<br /> ability." But it really comes down to dollar figures. The way the economy is, our reimbursements this year
<br /> from the State are going to be zero, next year is going to be zero,-so we need to look at other means of
<br /> raising monies.
<br /> E. OWASA— Ed Kerwin
<br /> This year is our 25th anniversary of operation. The utilities were separate systems owned by the
<br /> two towns and the University. The University and towns got out of the utility business 25 years ago when
<br /> OWASA was formed. We are governed by a nine-member appointed board of directors from Chapel Hill,
<br /> Carrboro, and Orange County. The OWASA board has the last say with respect to policy, rates, borrowing
<br /> money. Some of the slides you are going to see will show the high points of a 50-year comprehensive
<br /> master plan that was just completed. It didn't take us 50 years to get it completed, it took us three years. But
<br /> we've looked at 50 years into the future and started to project how much water and sewer will be expected of
<br /> us and what facility improvements we'll need to put in place to meet that. The real key assumptions in our
<br /> master plan is our service area boundaries will not change, that we're not going to be a wholesale provider of
<br /> water or sewer service, and that the growth trends we've seen in the past 20-25 years would continue in the
<br /> future. Here is our service area in red, essentially the towns of Chapel Hill and Carrboro. Our water supply
<br /> comes from three sources - Cane Creek Reservoir, University Lake Watershed, and a stone quarry, currently
<br /> being mined. Thirty years from now the mining will stop and during those times when University Lake and
<br /> Cane Creek are full and overflowing, some of that water will be diverted to the stone quarry reservoir for
<br /> storage and become part of the overall supply system.
<br /> The County and OWASA have been very proactive in protecting the watershed. In the current
<br /> system of University Lake, Cane Creek, and the small existing quarry reservoir, we've had a 30-year safe
<br /> yield of about 15 million gallons a day, and that should be adequate for the next 20-25 years. But we do have
<br /> a long-term interest in retaining our Jordan Lake allocation, and I'll talk a little bit more about that in a few
<br /> minutes. He distributed copies of the PowerPoint presentation. The green dots represent the raw water or
<br /> pumped, and you can see over time that we've been a very predictable utility or service area as far as growth
<br /> —2-3% growth of water for the last 25 years, if we went back to day one for OWASA. And then these lines
<br /> represent how we expect to grow. The center line is what's expected, and then we have a low growth/high
<br /> growth scenario. The lakes have a safe yield of 15mgd, but we have to improve the size of the pumps and
<br /> the pipes to get it all there when we make those improvements over the next five or six years. Here we are
<br /> with a safe yield of about 15 million gallons a day, and if you go over here and find a green line, how we
<br /> expect it to grow, that takes us to the year 2030. However, if we grow higher than what's expected or, when
<br /> the key assumptions change and now we're providing water to another entity or something like that, then this
<br /> all changes, of course. And this is the basis on which we believe we have justified hanging on to some of our
<br /> Jordan Lake allocations. Currently our allocation is 10 million gallons a day. We have asked it to be reduced
<br /> to five, and we've justified that based on this uncertainty in the future within the next 20-30 years of perhaps
<br /> having a deficit. We have talked to Durham and Chatham about collaboration in Jordan Lake. A likely
<br /> scenario for us to consider in the future is buying finished water from Durham, if we are in the situation makes
<br /> much more sense for us rather than building our own conveyance system from Jordan Lake. And then in the
<br /> future, you see this safe yield jumping up to about 20 million gallons a day, a little over 20 million gallons a
<br /> day, and that's when we think the quarry reservoir will be online. And so, if all goes well, we should have
<br /> enough supply in Orange County, given those assumptions, to meet our needs for the next 50 years with
<br /> some uncertainty here.
<br /> The dark blue line is our annual average daily demand. The other lighter colored line is the peak
<br /> day demand. And you can-see that the peak day demands have been increasing, and this is just depending
<br /> on the weather. If you look back here, this is 1999, and you can see we had a peak day of over 15 million
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