City of Polson April 5, 2010 PUBLIC HEARING Water System Improvements PRESENTATION ON PRELIMINARY ENGINEERING REPORT

Project Scope §Prepare Preliminary Engineering Report (PER) §Address Short and Long-Term Water System Problems §Incorporate Results from Hydraulic Modeling Performed by Thomas, Dean and Hoskins §Develop Financial Plan §Pursue Financial Assistance §Keep the Public Informed

What is a PER?? §Analysis of the Existing Water System §Identification of System Deficiencies, Current and Future Regulatory Issues §Evaluate Viable Solutions, Develop Costs §Identify the Most Cost-effective Option §Develop a Workable Financial Plan §Assess Environmental Impacts §Implementation Strategy

Preliminary Engineering Reports Keys to Success Document Need!! Comply with PER Outline Reasonable Capital and O&M Costs Address Existing and Future Regulations Workable Financial Plan Encourage Public Involvement

2010 Water System PER City of Polson Existing Projected Existing and Projected Water Use ADD (Average Daily Demand in GPD) ADD (GPM) Estimated Population* 4,8494,9855,0895,2285,3855,5467,45410,017 GPCD (ADD/Population) Population/2.32 Household = EDU Est. Commercial/Inst. EDU's Total EDUs Use/EDU (GPD) ADD with 10% Reserve Capacity (GPM) MDD (Max. Daily Demand) = ADD X 2.2 = GPD MDD (GPM) PHD (Peak Hourly Demand)= 2.5 X MDD = GPM Pump Capacity* (GPM) 2120 Pump Capacity w largest Pump out of Service1600 * Utilized 3% annual growth rate Project Design Criteria

Problem Evaluation and Resolution §Water Supply §Storage §Distribution – Water Mains, Valves and Hydrants §Develop Financial Plan

Water Supply Problems §Additional Water Needed to Meet Anticipated Peak Demand §Water Needed on East Side of City during High Demand § Unaccounted for Water l Leakage l Unmetered Users §Complex Water Rights Issues §Variable Aquifer Characteristics §Limited Data on Peak Use and Aquifer Response §Global Warming (Drought)

Activities to Address Water Supply Issues §Obtain New Sources of Groundwater §Replace All Malfunctioning Water Meters §Install Meters on City Facilities §Remain Involve in All Water Rights Negotiations, Further Investigate Existing Rights §Expand Monitoring of Water Use including PWL, SWL and Peak Use

Potential New Well

Storage Tank Needs §Two Tanks Under Construction §Renovate Interior Tank Coating on Skyline I §Connect Available Storage at Skyline to West Parts of Town §Plan for Future Storage near Woodbine Tank

Identified Distribution System Problems §Low Pressures and Lack of Adequate Flow to Fight Fires in the Downtown Area §Skyline-Woodbine Connector via Skyline Drive Reconstruction §Hydraulic Restrictions (undersized mains) 4 th Street East, etc §Looping of Water Mains- Irvine Flats, Kerr Dam Road.

Resolution of Distribution System Problems §Downtown Water Main Improvements §Install 10” Main in Skyline Drive under Road Reconstruction Project §Eliminate Hydraulic Restrictions §Water Main Looping §Ongoing CIP for Undersized Mains

Summary of High Priority Needs §Supply l Construct New Well on East Side l Address UAW §Storage l Rehabilitate Skyline I Metal Tank l Connect Skyline Storage to West Side §Distribution l Downtown Main Upsizing l Skyline Drive Reconstruction l Address Hydraulic Restrictions thru out City

Cost Summary §New Well - $231,945 §Storage Improvements - $189,610 §Distribution Improvements - $1,920,309 Total High Priority Needs Total Construction Cost $ 1,658,330 Contingency $ 282,244 Engineering $ 331,666 Legal, Administration $ 69,623 TOTAL PROJECT COST $ 2,341,864

Financial Assistance §Treasure State Endowment Program l up to $500,000 grant §DNRC Renewable Resources Grant l up to $100,000 grant §CDBG Grant l up to $500,000 §Montana State Revolving Loan Fund l 2.75% and 3.75% loans l up to 30 year term §Current Economy May Limit Grant Opportunities

Other Funding Scenarios §Extend Loan Term §Seek $500,000 CDBG grant §Divide Project into Smaller Components §Pursue STAG, WRDA, ARRA, RD or other Grant Funding

Existing Rates for Water and Sewer Service Current “Typical” Water Rate $25.09 Current “Typical” Sewer Rate $28.75 Combined Rate $53.84 Target Rate Used for Funding $ 41.92

Cost for Ratepayers Assumptions- No Local Funds, Use SRF Loan 3.75% for 20 Years No Grant50% Grant Funding Debt Amount $ 2,341,864 $ 1,170,932 Debt Reserve $ 180,750 $ 90,375 Total Loan $ 2,522,614 $ 1,261,307 # EDU’s 2967 Debt Cost $ 5.10 $ 2.55 Coverage (25%) $ 1.28 $ 0.64 Cost per User $ 6.38 $ 3.19

Potential Project Schedule §Complete PER this Spring §Develop CIP §Grant Applications due April-May of 2010 §Grant Funds Available in Summer 2011 §City is in Process of Drilling Test Well

QUESTIONS? Contacts: Scott or Tony THANK YOU!!