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3.1 SR 01-10-2023 Request for Action To Item Number City Council 3.1 Agenda Section Meeting Date Prepared by Discussion January 10, 2023 Brandon Wisner, Engineering Project Manager Item Description Reviewed by Discuss Options for NE and NW Utility Justin Femrite, PE, Public Works Director Services Reviewed by Action Requested Provide direction to staff for future expansion of city sewer and municipal water service areas. Background/Discussion As a follow up from the presentation to the city council in September, our consultants will present the options pertaining to the design and financial components necessary to expand into the NE and NW portions of the city municipal utility service areas. Financial Impact To be discussed. Mission/Policy/Goal  Responsibly grow Attachments  Commission Update The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity. Updated: August 2020 From the desk of General Manager Mark Hanson Thoughts for the NE/NW urban services expansion discussion at the combined meeting ERMU’s focus should be on supporting the NE expansion area. o Consulting services to review infrastructure needs is included in our 2023 budget. o The city has already identified multiple development projects that are adjacent to the existing urban services area. o Building out from adjacent developments provides more direct cost-sharing of trunk lines by having developers pay to extend existing trunk lines to their developments. o In addition to roughly eight miles of trunk main, the NE expansion area will require a new well, treatment plant and water tower, likely within five years. o Project costs for the NE area alone are estimated at $32M and will require bonding. The NW expansion is cost prohibitive at this time, especially given the $32M needed to proceed with the NE expansion area. o Proceeding with the NW expansion simultaneously with the NE expansion would add approximately $44M in project costs, the majorityof which would require bonding. o Only one development project has been identified in the NW area and it’s located at the farthest point from existing trunk mains. No adjacent development projects have been identified at this time. o Connecting to this development project would require adding roughly five miles of trunk main to support a single, 500-unit development. This could lead to water quality concerns related to stagnant water in large trunk lines over long distances, especially in the winter, when water use is at its lowest. Financial prudence would advise waiting 10-15 years before tackling the NW expansion area o Waiting to move forward with the NW area provides time to pay down, and possibly pay off, bonds incurred to support the NE expansion area o Waiting provides time for interest to grow in developments adjacent to existing infrastructure, maximizing cost sharing opportunities and minimizing stagnation concerns. If we do wait on the NW area: o Commission and Council will need to decide whether to maintain the current urban services policy which requires: New developments withinthe urban services area are requiredto hook up to both municipal water and sanitary services. New developments outsideof the current urban services area are notprovided with either water or sanitary services. o Public works has determined the city has the capacity to provide sanitary services to support the development in the far corner of the NW expansion area (if the current urban services policy were to be updated). Should the urban services policy be updated to allow the developer to hook up to city- provided sanitary service but use privately-owned wells for water? Should the development be postponed until additional, future development efforts enable ERMU to incrementally build out to the far corner of the NW expansion area? Northeast and Northwest Urban January 10, 2022 Service Expansion Study Ursinio Puga, PE The Presentation Team EHLERSDirector of Fiscal ConsultingJessica CookWSBWater/Wastewater Engineer Outline Financial Discussion•Proposed Utility Layouts & Cost•Standards of Service•Water Demand & Sewer Flow Projections•Description of Study Areas• Description of the Areas gravel mining areaIncludes portion of NW AreaNE AreaExisting Service Area Figure A1 increase of service areaAnnexing both areas results in 60% •2,800 gross acres–Northwest •2,200 gross acres–Northeast •Section 2.4 of report Description of the Areas (cont.)Figure A6 NORTHEAST STUDY AREA1,3282,193Total911Neighb. Commercial307523Mixed Residential1,0121,659Single Family Res.AcreageNet Developable AcreageGross Land Use Type Section 2.4 of report Description of the Areas (cont.)Figure A7 NORTHWEST STUDY AREA1,9312,825Total202214Open Space/Parks2933Public/Semi Public4148Highway Business266318Mixed Residential1,3932,212Single Family Res.AcreageNet Developable AcreageGross Land Use Type Section 2.4 of report Water Demand Projections Existing water distribution system averages 2.3 million gallons per day (23% increase)1,357,3752.6 peaking factor-Maximum Day Demand 524,083Total Average Day Demand8,100900 gpd/acre9Neighb. Commercial222,503725 gpd/acre307Mixed Residential293,480290 gpd/acre1,012Single Family Res.Water Demand (gpd)Water DemandAverage Unit AcreageNet Developable Land Use TypeMaximum volume of water delivered to the system in one dayMaximum Day Demand:•Average volume of water delivered to the system in one dayAverage Day Demand: •Sections 3.2 and 3.3 of report Northeast Areas– Water Demand Projections Existing water distribution system averages 2.3 million gallons per day (22% increase)1,326,9842.6 peaking factor-Maximum Day Demand 512,349Total Average Day Demand00202Open Space/Parks0029Public/Semi Public36,900900 gpd/acre41Highway Business192,850725 gpd/acre266Mixed Res.282,599Varies1,393Single Family Res.Water Demand (gpd)Water DemandAverage Unit AcreageNet Developable Land Use Type Sections 3.2 and 3.3 of report Northwest Areas– Sanitary Sewer Projections Existing sanitary sewer system averages 1.35 million gallons per day (33% increase)1,582,2633.5 peaking factor-Peak Hourly Flow 452,075Total Average Daily Flow7,200800 gpd/acre9Neighb. Commercial191,875625 gpd/acre307Mixed Residential253,000250 gpd/acre1,012Single Family Res.(gpd)Wastewater Flow Wastewater FlowAverage Unit AcreageNet Developable Land Use TypeMaximum volume of wastewater generated in one hourPeak Hourly Flow:•Average volume of wastewater generated in one dayAverage Daily Flow:•Sections 4.2 and 4.3 of report Northeast Areas– Sanitary Sewer Projections Existing sanitary sewer system averages 1.35 million gallons per day (32% increase)1,498,4343.5 peaking factor-Peak Hourly Flow 428,124Total Average Daily Flow00202Open Space/Parks0029Public/Semi Public32,800800 gpd/acre41Highway Business166,250625 gpd/acre266Mixed Res.229,074Varies1,393Single Family Res.(gpd)Wastewater Flow Wastewater FlowAverage Unit AcreageNet Developable Land Use Type Sections 4.2 and 4.3 of report Northwest Areas– Standard of Service Design storage infrastructure to provide 3,500 gpm for a period of 3 hours•Design firm pumping and treatment capacities to meet maximum day demands•Maintain water velocities below 5 fps•Maintain water pressure between 50 and 80 psi and not less than 35 psi•Sections 3.4 through 3.7 of report Water Distribution System– Standard of Service Design pressurized forcemains to maintain wastewater velocity between 2 and 5 fps•Design infrastructure with 25% excess capacity at peak hourly flows•Minimize gravity sewer depth in excess of 30 feet•Prioritize gravity flow over pressurized flow•Sections 4.4 through 4.7 of report Sanitary Sewer System– Northeast Area Water Service 1.0 MG water tower needed in 10 to 15 year timeframe•Treatment may be needed at new well•Minimum 850 gpm well needed in 5 to 10 year timeframe•inch trunk watermain with looping-Extend 12•Area can be annexed to the system’s high pressure zone•Figure A9Sections 3.4 and 3.5 of report Northwest Area Water Service 1.0 MG water tower needed within 5 year timeframe•Treatment likely needed at both wells•timeframeMinimum 850 gpm well needed in 5 to 10 year •Minimum 850 gpm well needed immediately•Two booster stations needed immediately •inch trunk watermains-Extend 12 and 16•Area needs separate pressure zones•Figure A10Sections 3.6 and 3.7 of report Opinion of Probable Cost $ 43,977,000 $ 31,635,000 Total Project Cost$ 7,329,560 $ 5,272,420 Indirect Costs (20%)$ 36,647,800 $ 26,362,100 Construction Total$ 3,331,620 $ 2,396,550 $ 33,316,200 $ 23,965,500 Total-Construction Sub$ 3,250,600 $ 2,046,500 Other (hydrants, valves, and fittings)$ 4,750,000 $ 4,750,000 Storage Infrastructure$ 12,000,000 $ 9,500,000 Wells and Treatment$ 1,222,000 -$ $ 7,748,000 $ 4,543,000 Trunk Watermain$ 2,897,100 $ 2,084,000 Mobilization/Demobilization$ 1,448,500 $ 1,042,000 Bonds, Insurance, and General ConditionsNorthwest AreasNortheast AreasImprovement Section 5.1 and Appendix B of report Water Service– Northeast Area Sewer Service treatment plantNew receiving structure needed at the wastewater •wastewater treatment plant with dual forcemainRegional lift station to pump directly to the •Minimum of three lift stations needed•Extend trunk sewer ranging from 10 to 18 inches•Sewer to flow southeast mostly by gravity•Figure A19Sections 4.4 and 4.5 of report Northwest Area Sewer Service treatment plantNew receiving structure needed at the wastewater •wastewater treatment plant with dual forcemainRegional lift station to pump directly to the •Minimum of three lift stations needed•Extend trunk sewer ranging from 10 to 12 inches•Southeast corner can flow to existing system•Windsor lift station can serve western areas•Figure A21Sections 4.6 and 4.7 of report Opinion of Probable Cost $ 15,335,000 $ 13,143,000 Total Project Cost$ 2,555,800 $ 2,190,560 Indirect Costs (20%)$ 12,779,000 $ 10,952,800 Construction Total$ 1,161,730 $ 995,710 $ 11,617,300 $ 9,957,100 Total-Construction Sub$ 6,000 $ 6,000 Connecting to Existing System$ 6,557,000 $ 4,096,400 Pressurized Forcemain and Testing$ 25,000 $ 80,000 Air Release Manholes$ 2,840,000 $ 2,865,000 Lift Stations$ 674,000 $ 1,611,000 Trunk Gravity Sewer and Manholes$ 1,010,200 $ 865,800 Mobilization/Demobilization$ 505,100 $ 432,900 Bonds, Insurance, and General ConditionsNorthwest AreasNortheast AreasImprovement Section 5.1 and Appendix B of report Sewer Service– Financial Analysis Methodology Estimated costs per single family unit•Demands placed on system o Development Density o Zoning o Allocated total project costs based on:•Section 5.2 and Appendix C of report Northeast Area Costs per Single Family Unit 22,144 TOTAL5,769 SAC Fee3,634 Sewer Expansion Costs3,990 WAC Fee8,751 Water Expansion CostsFamily Unitper Single Estimated Cost Fee/AssessmentDevelopment Northeast Study Area Section 5.2 and Appendix C of report Northwest Area Costs per Single Family Unit 19,724 TOTAL5,769 SAC Fee2,335 Sewer Expansion Costs3,990 WAC Fee7,630 Water Expansion CostsFamily Unitper Single Estimated Cost Fee/AssessmentDevelopment Northwest Study Area Section 5.2 and Appendix C of report 2022 Development Fee Comparison Total WaterTotal Sanitary Sewer(Assumes 1/3 developable acre)Infrastructure Development Fees for Single Family Home No. 12Sewer DistrictSanitaryNo. 2 andWater DistrictWoodburyRosemountLakevilleAreaNorthwestHeightsInver GroveHeightsInver GroveHastingsAreaExpansionElk River NWAreaExpansionElk River NERavineGrove UpperCottageChanhassen $25,000 $20,000 $15,000 $10,000 $5,000 $-Section 5.2 and Appendix C of report Options for Recovering Costs Difficult to administer when development pattern and final costs are unknown o May make it more difficult to prevent “leapfrog” development oo Protects Elk River if development occurs slower than anticipated o Specially Assess all Property in Expansion Area•Negotiate with major developer to install and pay for infrastructure o Developer Payments•Section 6 of report Options for Recovering Costs Reliable revenue source•New and existing users contribute to infrastructure costs•User Charges•Puts city at greatest risk if development pace is slower than expected•Collected with building permit•SAC and WAC Fees•May be assessed•Collected when land is platted•Area Trunk Charges•Section 6 of report Conclusions Further discussions are needed to study options for recovering costs•It may not be feasible to serve both areas simultaneously•Serving the expansion areas will require a significant investment in infrastructure•Section 8 of report THANK YOU!