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Presentation to Residents Renovation of MUD 18’s Sanitary Sewer System Harris County MUD 18 Oct. 2011
Presentation to Residents
Renovation of MUD 18’s Sanitary Sewer System
Harris County MUD 18 Oct. 2011
Proposed Renovation of Sanitary Sewer System
Harris County MUD #18 - Board of Directors
Arved White – President
Roy Beversdorf – Vice President
Karl Skarboszewski – Asst. Vice President
Michael Murr – Secretary
Robert Bernardini – Treasurer
Proposed Renovation of Sanitary Sewer System
Harris County MUD #18 - District Consultants
Operations: SouthWest Water Company, Inc.
Engineer: AEI Engineering, LLC
Legal: Allen Boone Humphries Robinson LLP.
Bookkeeper: District Data Services, Inc.
Tax Consultant: Wheeler & Associates, Inc.
Financial Advisor: First Southwest Company
Proposed Renovation of Sanitary Sewer System
Louetta Road
Normont Road
Malcom
son R
oad
Grant Road
Proposed Renovation of Sanitary Sewer System
Proposed Renovation of Sanitary Sewer System
Proposed Renovation of Sanitary Sewer System
What is a MUD?
As a governmental unit, chartered by the State of Texas, our principle functions are:
Finance, Construct, Own and Operate waterworks, and wastewater facilities
Meet all state and federal regulations
Proposed Renovation of Sanitary Sewer System
Our Guiding Principles:
Provide clean & safe water,through reliable, continuous supply.
Safely remove and treat waste water.
Proposed Renovation of Sanitary Sewer System
Key Facts
Created: May, 1972
2 Water Plants: Malcomson Rd., Oak Bluff Dr.
Provide clean drinking water and sanitary sewer
services to 1,400 customers.
Maintain an infrastructure of over 15 miles of
water lines and 15 miles of sewer lines.
Proposed Renovation of Sanitary Sewer System
Key Facts
Successfully operated 2 wells and a shared
sewage treatment plant for 40 years.
On average, the District produces 200
million gallons of water and treats 200 million
gallons of wastewater a year.
Proposed Renovation of Sanitary Sewer System
Community Support
$67,000 per year for dedicated District Constable Patrol services.
Historically, some of the lowest water rates in NW Harris County.
Fire Hydrant Audits led to lowered Homeowner Insurance Rates.
Prime partner in development of Faulkey Gulley Greenbelt Trail
Financial support improves water conservation in common areas.
Regional awards for water conservation educational programs
at Hamilton Elementary School.
Proposed Renovation of Sanitary Sewer System
5-Year PlanningWe use a 5-Year Planning cycle that allows us to identify system problems and let contracts for necessary repairs.
2004-05 Refurbished water supply plants $500,0002010 Surface Water Chloramines Conversion $400,000 2006-11 Waste Treatment Plant upgrade $500,000
Over the years we have continued to be good stewards of your money.
5-Year PlanningOur most recent plan took several years, and included a television audit of our sewer system which identified the need to replace sewer lines.
TV cameras revealed:
Serious corrosion
Collapsed pipes
Roots in pipes
Mixed Materials: Concrete, Truss Pipe, PVC
Proposed Renovation of Sanitary Sewer System
Proposed Renovation of Sanitary Sewer System
Proposed Renovation of Sanitary Sewer System
Proposed Renovation of Sanitary Sewer System
Point Repairs
Proposed Renovation of Sanitary Sewer System
Fixing the problemLife expectancy for a sewer system is about 25 years.We’ve done Point Repairs (localized problems) all that time
Our engineer helped us prioritize sewer line problems: Repair: Now, Repair: Next, Repair: Soon After
Solution: A comprehensive system overhaul.Reline pipe runs with industry-accepted, epoxy-set, plastic liners that are less disruptive to homeownersproperty – this is a “no-dig” technology.
Proposed Renovation of Sanitary Sewer System
Line Repairs
Proposed Renovation of Sanitary Sewer System
What will it take?
Cost Estimate - $4 Million Dollars
Time Estimate - Scheduled over 5 years.
Repairs must start soon to avoid line back-ups.
Proposed Renovation of Sanitary Sewer System
What’s our Current Situation?Revenue: $1.20MM (Does NOT include NHCRWA fees) Expenses: $1.01MM
Proposed Renovation of Sanitary Sewer System
What Are Our Options to pay for this?
Under Current Water Rates and MUD Tax Rates,
We can only complete capital improvements
amounting to $200,000 - $300,000 per year.
Under a 5-year schedule, we’ll need: $730,000 per year.
Therefore, we have 3 options:A. Sell Bond Debt – requires resident approval B. Adjust Water, Sewer Rates – can be adjustedC. Adjust MUD Tax Rate – requires resident approval
Proposed Renovation of Sanitary Sewer System
A. New Bond (Debt) Option
We’re about to retire our last Bond debt
(1984 - 2012)We prefer not to sell new bonds that incur more long-term debt to every family in the District and
carry a significant extra cost to issue them.
Required: Resident approval
Proposed Renovation of Sanitary Sewer System
B. The Sewer / Water Rate Option
Using a combined water & sewer fee, the average rate paid is $3.16 per 1,000 gallons of water.
To fund an additional $400K required, we would need to increase rate to $5.16 per 1,000 gallons used.
EXAMPLE:
In Winter (10k gal avg.), the increase would be $20 per month, added to your current bill.
In Summer (25k gal), the increase would be $50 per month, added to your current bill.
Proposed Renovation of Sanitary Sewer System
C. The MUD Tax Rate Option
As customers, we are all presently paying: 32.4 cents per $100 of property valuation.
Of 32.4 cents, we use:25.0 cents for Maintenance & Operations,
(Since 1976, this has been maximum authorized tax.)
7.4 cents for paying off our Bond debt
Proposed Renovation of Sanitary Sewer System
C. The MUD Tax Rate Option
When our Bonds are paid off in 2012, only the 25 cent M&O component is left,
but it does not provide enough for sewer repair work.
However:We could adjust the remaining M&O component
from $0.25 to $0.50 per $100 valuation
Proposed Renovation of Sanitary Sewer System
C. The MUD Tax Rate Option
Annual MUD Tax Increase Examples (per $100 valuation)
$125,000 valuation at current $0.324 = $405
$125,000 valuation at $0.50 = $625, increase of $220
$175,000 valuation at current $0.324 = $567
$175,000 valuation at $0.50 = $875; increase of $308
Proposed Renovation of Sanitary Sewer System
MUD18 chose the MUD Tax Rate Option
We can accomplish the work with:
A M&O Tax re-set to $0.50 per $100 valuation
The plan is to complete the renovation in 5 years.
This new rate is competitive with surrounding districts.
M&O Tax rate hasn’t changed since 1976, but costs have escalated over the last 35 years.
Proposed Renovation of Sanitary Sewer System
To Review
A. New Bond Debt - Requires an election
B. Water Rate Increases - No approval needed
C. Tax Rate Adjustment - Requires an election
If the tax rate adjustment is not agreed upon, we still must complete the renovation.
The risk of not doing so is:
Potential sewer line breaks (backups into homes)
Health & safety concerns
Much longer project completion with limited finances
Proposed Renovation of Sanitary Sewer System
To Do
Think about what we’ve discussed.
Therefore we need your support on Tuesday, November 8th.
Proposed Renovation of Sanitary Sewer System
Voting Dates/Locations33
Early Voting location:14515 Dracaena Court, Houston, TX 77070
Dates/Times: Oct. 24 through Oct. 28: 7 a.m. to 11 a.m. and 3 p.m. to 7 p.m.
Oct. 31 through Nov. 4 7 a.m. to 11 a.m. and 3 p.m. to 7 p.m.
Regular Voting location:Heatherwood Clubhouse
15118 Willow Branch Drive, Houston, TX 77070
Date/Time:May 14 7 a.m. to 7 p.m.
