Storm Water Utility

Over the past two years, city staff has been reviewing a storm water utility concept for the City of Indianola. A storm water utility is allowed by State Code to address storm water flow safely/efficiently and environmentally friendly. Storm water utilities also help reduce flooding in a community. Many Indianola homes and businesses experienced flooding during the July rains, for example.

During previous discussions with our elected officials, staff was authorized to solicit quotes from engineers to study Indianola's storm water system, provide a recommendation for repairs/improvements as well as a fee structure. Fees are charged to properties that empty storm water into the system similar to fees that are charged for water and sanitary sewer.

On December 3, 2008, elected officials authorized a proposal from Veenstra and Kimm Engineers (V&K was the low of 4 bids received) to provide the services as requested. Elected officials approved V&K's proposal on a 4-3 vote with the mayor breaking the tie. In accordance with their vote, the proposal will be delayed until May 1 of 2009 and another review will occur on April 20.

Below are excerpts from the memorandum I prepared for elected officials to help make their decision.

WHAT V&K’s PROPOSAL DOES:

· Provides the first step in reviewing the city’s storm water drainage system to identify needed improvements on a priority basis
· Provides cost estimates for system improvements
· Includes review of alternative storm water methods including porous concrete, detention systems, etc
· Assists with public awareness and storm water education
· Develops a draft storm water utility ordinance




WHAT V&K’s PROPOSAL DOES NOT DO:

· Will not create a utility. That will be considered by council in about 12 months
· Will not implement a fee structure. That will be considered by council in about 12 months
· Will not begin improvements/replacements/additions to the storm water system. Those will be proposed in 10-15 months.

Information/Clarification:

ROAD USE TAX FUNDS/PROPERTY TAXES:

· RUT funds are derived from gasoline taxes. Revenues have increased slightly while expenses have increased significantly
· Storm water expenses including day-to-day operations and capital expenses are paid by Road Use Tax (RUT) funds or property taxes
· RUT cash balance has been decreasing annually. Projected FY 08/09 balance is estimated at $152,700. FY 06/07’s balance was $265,800
· Efforts including staff reductions and using property taxes to pay for capital equipment have slowed the RUT cash balance decline and delayed use of property taxes for Street operations
· Property taxes will be the only revenue source available when RUT funds are no longer sufficient to pay for Street operations/maintenance
· Property taxes are paid by only 70% of the property in Indianola

STORM WATER UTILITY

· Funds are derived from all property based on amount of storm water placed into the environment from rooftops, parking lots, driveways, etc.
· Storm water fees are paid to remove rainwater in a safe, environmentally acceptable manner
· In addition to capital expenses for storm water main repair/replacement/additions, the SWU can also pay for day-to-day operations such as street sweeping (staff and equipment)

STORM WATER PROJECTS:

Staff is aware of the following storm water projects:

· Stephen Court culvert addition--$125,000
· South Buxton s/w main replacement--$70,000
· Moats Park s/w main replacement--$100,000
· Balloon Museum ditch repair--$40,000 to $200,000
· S/W main extending north from Orchard Avenue across Country Club (15th hole)--$45,000
· S/W main replacement from Howard/Clinton to Moats Park--$300,000

The above projects total about $850,000 and will require repair over the next 5-7 years. There are other storm water issues that we’ll address in the next several years that are not listed above. Note that W. Iowa and N. 9th culvert replacement costs totaled nearly $115,000 last year.

If $850,000 in bonds were issued at 4.5% over 10 years, the annual payment would be $107,500, costing a $200,000 home about $23 annually.

HOW STORM WATER REVENUE CAN BE USED:

Based on “very preliminary” estimates of $3/month/household, the SWU would generate about $215,000 annually that can pay for:

· Bond payments for existing s/w expenses equaling a 3 cent property tax reduction
· Bond payments for street replacement in 2011 equaling a 3 cent property tax savings
· Provide a revenue source to maintain s/w retention ponds/drainage areas on private property
· Day-to-day s/w operations currently funded by RUT
· $215,000 annually would decrease taxes (or keep them from increasing) by about 53 cents equaling $48 on a $200,000 home.

WHY A STORM WATER UTILITY

· Storm water expenses are going to occur! The question before mayor and council is how to pay for them?
· SWU creates a fair and equitable fee structure for all properties, not just taxable properties
· SWU will reduce property taxes now and in the future by paying for costs that property taxes would pay.
· Property taxes will be reduced (or not increased) to offset the monthly fee
· SWU revenues could be used to offset special assessment costs (for s/w mains)
· SWU revenue can pay for storm water expenses now paid by RUT thereby slowing the need for property tax support
· A complete storm water study has not been performed since the early 80’s. A SWU would provide a funding source for the study
· A SWU would provide a funding source to help maintain detention ponds/drainage ways on private property that are not currently maintained
· Recent storms created flooding issues citywide. SWU is a pro-active approach to help prevent flooding in homes/businesses
· SWU will compliment our I&I efforts—Not only will the SWU help remove rainwater efficiently thereby relieving some of our I&I problems, but it will also help remove rainwater that is moved out of the sanitary sewer system
· Six cities in the metro area already have SWU’s. Three more cities are reviewing SWU’s.

There are compelling reasons to establish a SWU. However, that is not the issue before mayor and council at this time. I am recommending the city hire V&K to study our system and give us information on the concept. The mayor and council will have more input and a final decision in about 12 months when a fee structure and ordinance are recommended.

There are many questions about a storm water utility and hopefully the above information answers some of them. However, please contact me to answer any other questions you may have.

West Highway 92

Several months ago council teamed with county officials and IDOT to form a committee whose charge is to gain acceptance for improving Highway 92 from Indianola to Interstate 35. This "formal" committee is a result of the city and county's efforts during the last 6-7 years to move this project forward. With the help of Congressman Tom Latham, about $3 million of federal assistance has been granted. About $400,000 of that amount has been spent on an environmental assessment and corridor study during the past year and a half.

At the committee's meeting on December 10, it was decided to recommend using the remaining federal allocations to improve Highway 92 from “R” Street thru R-63. Consequently, IDOT is preparing an agreement for the city and county to jointly administer the project. However, as we all know, government does not work extremely fast so it may still be a year or two until the project gets underway.

I will continue provide updates on Highway 92 in the next couple months.

Movie filmed in Indianola?

The city received a request today from filmmakers to intermittently (5 minute periods) close Hwy 92 from Hwy 65/69 to Howard on December 15. They were not too open about the movie but did indicate the star was actor Ray Liotta (gang leader in Wild Hogs). The movie apparently is about domestic violence and some of the shots will be filmed in the A&W Restaurant.

The city intends to cooperate with the filmmaker’s request and will have officers at Hwy 65/69, 1st Street and Howard to control traffic. Affected property owners will also be contacted as will the IDOT.

When asked “why Indianola”, the response was it’s hometown charm. However, it was recent State legislation providing significant tax incentives that brought them to Iowa.

Whatever the reason, we are hopeful Indianola will get some good publicity if and when the movie hits the screens.