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HomeMy WebLinkAbout1970-03-10; Water Committee Ad Hoc; MinutesMINUTES OF: WATER COMMITTEE DATE OF MEETING: March 10, 1970 - 4:00 P.M. PLACE OF MEETING: City Manager's Conference Room PRESENT: Bob Watson, Knox Williams, Carl Prince, Bill Esterline, Win Friday, Joe Spano, Theltna Sowell, Glenn McCoraas, Bob Neely, Chief Anear ABSENT: Don Hickethier, W. D. Cannon, Hunter Cook 1. Minutes of the meeting of February 24, 1970 were approved as written. 2. Consideration of motion for Reservoir #1 - Mesa Drive - Mr. Watson and Mr. Esterline put together an outline for a motion, a copy of which was distributed to each member present. Mr. Watson stated that Engineering Science and the various staff reports indicate that Parcel 4 consisting of 10,000 square feet, as shown on the distributed map, be retained for a storage tank. Mr. Watson reviewed the outline to the Committee for their consideration. The outline indicates a selling price of $17,700 minus $5,000, the cost to remove the existing Reservoir and restore the land to residential standards. Therefore, the recommended selling price would be $12,700. It was stated that this Reservoir is now used for storage. Mr. Spano stated the sale of this Reservoir should be simul-: taneous with the construction of the proposed water improve- ments. Mr. Esterline agreed that if this Reservoir has a use, then it should be recommended that the sale of the property be deferred until such time as its replacement is constructed. Mr. Watson agreed and suggested tabling this matter until the next meeting subject to a report from the Engineering Department on this matter. It was stated this Reservoir is used mainly for fire purposes. It was agreed that this be referred to the Engineering Department for their review and report for the next meeting. 3. Consideration of sale of bonds - Mr. Watson reviewed a letter from O'Melveny & Myers, Bond Attorneys counseling the City as to the eligibility of the sale of bonds. They stated the Legislature's 1% statutory limit on bonds does not apply to local government. Mr. Esterline questioned what the net gain in the Water Depart- ment revenues would be without including any additional bond charges. Mrs. Sowell stated there would be a gain" of about $65,000 to $70,000 a year net profit with the current water rates and an increase in meter rates. Chief Anear stated that on a bond issue there is no provision for installing fire hydrants. Discussion ensued on the sale of bonds and the sale of Calaveras Lake. Mr. Neely stated that people have stated the City should sell Calaveras Lake rather than increase the rates. Mr. Watson felt that the Water Department had no need for Calaveras Lake and it should be sold and proceeds used to improve the water system. In response to certain opinions that the Lake should be retained for a park, Mr. Watson stated that if another Department of the City wished to have Calaveras Lake, the Water Department should be reimbursed. The water improvements studies and finances were discussed at great length with the following points being made: 1. Considerable funds have been expended for studies and designs for water systems improvements over the past several years. 2. The ability to sell bonds as approved by the electorate is in jeopardy due to increased interest rates and failure to increase water rates as recommended by Bartel Wells' study. 3. In order to accomplish the water improvements, the alternatives are: a. Present matter to electorate to increase maximum allowable interest rates on bonds. b. Raise the water rates to place the City in a better financial position to service the bonds. c. Increase the municipal tax rate for the purpose of servicing the bonds. 4. Unless some action is taken, it is doubtful whether the City is in a position to finance their share of the water improvements. - 3 - Mr. Esterline outlined a suggested procedure to be presented to the Council on what the committees had done and include dates of revenue bond passage. Mr. Esterline presented a seven-point program to present to the Council concerning the financing and ability of the Water Department to pay. Respectfully submitted, \o Barbara Bishop Recording Secretary