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6.4. ERMUSR 10-15-2003 J Elk River Municipal Utilities 322 King Avenue phone: 763.441.2020 Elk River,MN 55330 Fax:763.441.8099 October 7, 2003 To: Elk River Municipal Utilities Commission John Dietz Jerry Takle James Tralle From: Bryan C. Adams Subject: Customer Owned Water Service Lines At the June 2001, Elk River Municipal Utilities Commission meeting, we discussed the ownership of water services. Attached is my memo dated June 7, 2001, for your review. We would like to again, propose an insurance program to cover the costs of customer owned service lines. We are experiencing many calls (I to 2 per month), where a customer owned valve before the meter but inside the house fails and starts to leak. The customer calls us for repairs. If we tell the customer the leak is his responsibility and to call a plumber, we still must go to the residence, locate and turn off the water at the curb stop, then return again after the plumber has made his repairs and turn the water on at the curb stop. The customer is angry because we didn't make the repairs, and he was required to expend money for a plumber. We still have to go to this residence twice, many times after hours at overtime pay. Often times your staff, in an effort to be accommodating to the customer, repairs the leaking valve, thus saving a trip to this customers residence. It takes about 15 minutes to replace the valve and the customer replaces our valve we use from stock. The customer is happy and we save time. Unfortunately, we are not following our own policies and we are taking on some liability. We have the following three options to resolve this issue. 1.) Stop making the repairs and follow our own policies. 2.) Change the policy to allow us to help the customer in these instances. 3.) Offer an insurance policy to help these customers pay for the unexpected water service repairs. We would take on the responsibility of service leak repairs up to the meter. Additional cost is in the $1/month/meter. We ask for your comments on this issue. In regard to a broken service line, which could cost $2,000-$3,000 to repair, we now have available an assessment tool where the cost of repairs are assessed on taxes over a period of years for the customers who do not have the cash to make the necessary repairs. We front the money and are paid back overtime. ;k River --- Municipal Utilities 322 King Avenue phone:763.441.2020 Elk River,MN 55330 Fax:763.441.8099 June 7, 2001 To: Elk River Municipal Utilities Commission George Zabee James Tralle John Dietz From: Bryan C. Adams Subject: Water Point of Service The ERMU Water Rules, Section 103, Water Service Repairs, states the following: Repair Responsibility: Maintenance or repair , of the service from and including the main stop cock to the premises remains the responsibility of the property owner. Water service repairs or renewals that become necessary will be made by a licensed plumber at the expense of the property owner. Whenever it becomes necessary to repair or replace a broken or defective water pipe running from the main in the street to the meter, the said broken or defective water pipe is not of copper or cast iron construction, it shall be replaced by copper tubing. Type K one (1) inch minimum size. Leak Repair: When a leak develops on a customer's service, it shall be repaired as soon as possible If repairs have not been completed within a reasonable time as determined by the Elk River Municipal Utilities, the water will be shut off. During the week of May 28, 2001, a water customer at 1205 0 Street NW had a water leak on his water service. Unfortunately, the resident did not have enough money to pay for the necessary repairs. It was agreed to make the necessary repair and the cost of the work would be assessed to his property taxes. The ERMU actually pays the cost of repairs and we will be reimbursed annually through the tax assessment. Attached for your reference is a petition for local improvement. The city council approved this 1 petition on June 4, 2001. The ERMU also must take formal action and approve this petition. On a broader issue, this situation is going to occur more often as time goes on. This Commission has discussed in the past, changing the point of service from main stop cock to another location, (Curb shut-off or water meter in the building) or devising an insurance program to help customers pay for these unexpected water service repairs. These repair costs can be as high at $2,000 to $3,000 . MMUA is just completing a survey of water utilities. One of the questions is location of point of service. I will provide at this meeting the preliminary results of that survey. Most of our customers do not understand that they own and must maintain the water service to the main which includes removing and patching the street if the water service needs repair. Currently, a failed water service occurred not more than 6 times a year. We have the following options on this issue: 1) Do nothing and leave the current policy in place. When these financing issue arise, handle on a case by case basis. 2) Change point of service location to curb box, which is on property line. The ERMU would then be responsible for failed service on public property and owner would be responsible for failed service on private property. 3) Change point of service location to water meter (Same as electric). ERMU would then be responsible for entire service. 4) Do nothing and leave current policy in place but implement an"Insurance Policy" through higher water rates where the ERMU would take on the responsibility to repair the failed water service along with financing the repair. Upon reviewing the results of the MMUA survey, we can discuss this issue further at the Commission meeting. nu &Pie CUe 07) .7z)