PLAINFIELD TOWN COUNCIL
Special Meeting
DECEMBER 1, 2010
Mr. Brandgard: Plainfield Town Council special meeting for Wednesday, December 1, 2010 is now in session. I would like to ask everyone to rise for the pledge of allegiance.
PLEDGE OF ALLEGIANCE
Mr. Brandgard: Thank you. The reason for this meeting is to discuss and approve the sewage works bond ordinance and I will turn it over to…
Mr. Kleiman: I'm Andy Kleiman with Benesch, Dann, Pecar. I work with Mel Daniel. We are here today to present ordinance reconsideration. We do need to have this if we are gong to close the bonds by the end of the year we do have to have the ordinance approved tonight which I know is unusual. But the reason why is we need to have a notice of this bond ordinance published in the Hendricks County Flyer, which would be on Saturday and then we have a 20 day objection period after that which will take us depending on how you count the 24th or the 25th and we are scheduled to close the bonds I think on the 30th or 31st. I am going to be fairly brief and then turn it over to Tim Belcher and to Dave Fredrick or Christina. Projecting together fairly quickly it is a two pronged project, part of it being an extension of the Buchanan sewer project which is already underway and the other part of it being the project being involving the Department of Corrections. As it stands right now the, and Dave can get more into this, or Christina. The interest rate we are looking at on the Buchanan Street project is I think 2.84 percent and for the Department of Corrections project if all goes well that will be a forgivable band similar to what we did last year, I think part of the water deal that we did through the SRF at the end of the year at no cost to the Town.
Mr. Belcher: I will go through the projects briefly; I have some overall sketches for you to look at, again like Andy said two prong approaches to the project, one being, I will start with the Buchanan Street project. That name actually came from a project that part of it is completed, the project we did on Buchanan Street itself included sewers that were under US 40 and now include sewers that go north of US 40 into the neighborhoods and what we are bidding on the 13th is the section you see. Essentially from this bright green line going north off of 40 and a small piece that didn't show up too well in this drawing but there is a small piece in this area also that needs to be done to complete separation of combined sewers that were a long term plan and again this is an area that we have been working on for sometime and progressing on. We got done on Buchanan last year, we started that and what's going on US 40 is a continuation and then what is going north of 40 again is this building out the same backbones that we've already constructed. So the purple box that is on there is what is in the bond ordinance as far as the boundary so it is large enough boundary to include all of those projects we just talked about and the green lines are essentially the sewers that would be funded if this bond issue is approved, sold, and goes the way we hope. This would be the portion that would be as I understand, not forgivable loan; this will be an actual loan from SRF if approved.
Ms. Whicker: Furthest east from furthest west can you tell me those names?
Mr. Belcher: Furthest east is Carr Road; let me just go around the boundary real quickly. This is Carr, Buchanan, and the only reason I use Buchanan as a boundary is because there is a small piece of sewer in here and we still need to separate. The sewer under 40 goes all the way to White Lick Creek because we have storm drainage that outlet it at White Lick Creek and then this would be Indiana, Eastern, Pickett, and spring. The alleys included in fixing the drainage and paving the alleys so essentially it would be a lot like Buchanan, although we wouldn't be putting a lot of curving in that area or building new sidewalks and things like that, it is more of just the sewer project which is what the funds are for. The streets would get fixed obviously after we tear them up and put the sewers in. Just to give you a little bit more, this piece on Indiana is an alternate in the documents when we handed out the bid because the funding they are still working on our rate study, we obviously want to do this without any rate increases to our rate payers'. If we need to carve down or pair down a project, that part could come out and be done later so we are hoping that that would give us the flexibility should the bids come in higher than we expect to just downsize the project to fit into the bond issue we have and not have to worry about any kind of rate increase. That is the direction of Buchanan Street project. I'll give you the big picture the Department of Correction Facility the purple line I've drawn around is what is described in the bond document, this is 700, this is Hadley Road, here is Moon Road, US 40, and White Lick Creek essentially until it gets to the bridge over White Lick at 700 there. Within that area the yellow highlighted areas all State property right now. There is 800 acres in that yellow box that currently is served by the Town sewer and the Department of Correction's own water system and their own plants and wells that are part of the negotiations we've been going through, they would like to get out of the utility business. One of their biggest problems is their sanitary sewers which are very old and leaking and things like that. So the funding that we are talking about tonight would be a first and foremost to replace the sanitary sewer system that exist within that yellow box and there is different ages and different types and a lot of things that went over the decades that that facilities been out there that we would be correcting as part of this project with the forgivable loan side so it wouldn't cost the Town anything, those funds would be coming through the escrow for the Town and not be a burden to our rate payer's. The water utility that they own again, I think that's their sympathies with those utility, different things we've been looking at and we are working on an agreement that we would hope to negotiate with the DOC for the different assets that we would like to contain. Essentially the funding that we are talking about tonight is for the replacement of the sewer system. It has nothing to do with funding the water system.
(Inaudible)
Mr. Belcher: Picture of what we've got so far in terms of the blue lines being what we believe to be the existing sewers and the orange being a proposed method of serving and replacing, getting rid of the old and adding connections to the existing buildings to the new system so we would have to get service to all the facilities out here that the State currently serves. All of those buildings now come through a sewage meter that the Town reads each month and we send the State a bill for the sewage that comes through there. They've struggled over the years because of the water entry, storm water entry, ground water entry and things like that. I think they had a problem with their steam plant one time that was putting way too much water into the sewers they came through our meter and they got charged for that and so from the view point of the State and we all are State tax payers, I think the ideas they would save sewer billings and again get a good system out there that we would eventually obtain a portion of that, we don't want to maintain all of it, we don't want to maintain sewers inside of a secure fence but that is all part of the agreement we hope to reach with the State in more detail later on. So I think that is it on the projects unless I missed anything and if you have any questions.
Mr. McPhail: Tim, does this include the Law Enforcement Academy?
Mr. Belcher: Yes, they are currently served on the same water system as all of the other facilities out there and the same sewer comes through the same sewer meter through a system that is all connected together so we would be replacing a sewer service out to that facility, right now I think it is served with a lift station, and we think we can get rid of that which will be more efficient way to serve it and there are other things out there that we think we can do better than the way it is served now as in terms of design.
Mr. McPhail: A couple of neighborhoods south of there, are those on the sewer system?
Mr. Belcher: No they are not and they are not currently in the Town either, but there has been some thinking in this plan with regard to not only the area south of there but areas to the west possibly and southwest. Some of these sewers that we are doing the planning for right now to service this facility we would hope it would be sized and properly constructed in plans so that they could serve other areas along Moon Road to the south which currently have no service, so we are trying to think through those things, I think the area you are talking about actually right across the street, Peacock Lake would be the more logical service point for them, there are sewers in that subdivision.
Mr. McPhail: Very good, thank you.
Mr. Belcher: That is all I have unless there is any other questions.
Mr. Carlucci: They've got so much ground water, just getting into the Town's system that they are paying a surcharge because we are actually treating almost more water than we are sewage.
Mr. Belcher: Yes, except for this year will be the only time that it has been lower than normal probably because it is so dry, but your right Rich, that is exactly…
Mr. Carlucci: That and we've just finished up a five million dollar project on our north treatment plant which is on Center Street, and the more of curable water we are putting through that plant and processing is really inefficient for a plant to be doing that. It's a sewage treatment plant, not a water treatment plant in that sense, so we think with the benefit to us will be some of the other things that we may be able to negotiate with the Department of Corrections that will benefit the Town in a lot of different ways. We are not there yet because we haven't met with them to set up a presentation to them, which is our next step.
Mr. Kirchoff: If we are not successful in negotiating this contract or this agreement with DOC, how would it impact what we are talking about tonight?
Mr. Belcher: My understanding is that the expenses that we've incurred so far to study the DOC facility, that they have agreed to forgive those costs regardless of what happens, the remaining amount I believe will still be a loan to the Town for the Buchanan Street project and I think that was a little over eight million, I think about 2 1/2 , maybe a portion to the Buchanan Street and the rest to the DOC, I am speaking maybe out of turn here, but the idea would be the 5 ½ may go away and not be utilized and then the 2 ½ would still be a loan to the Town for the sewer utility.
Mr. Carlucci: But they are going to pay our out of pocket expenses.
Mr. Belcher: Yes, for all of the work we have done for the DOC, so far they've agreed to pay that back.
Mr. Brandgard: I think the key thing here is we are doing this at their request.
Mr. McPhail: There is great value in it too, if it is economical for all of us to stop that influx of ground water in that sewage. Although they are paying for it, in a processing claim water. We don't need to be doing that.
Mr. Belcher: We still need to have the chemical, power, and all of that cost…
Mr. Brandgard: It opens up more usage for the points.
Mr. McPhail: It gives us capacity for other customers once we get that corrected. This also keeps us moving forward on our agreement to get this thing separated.
Mr. Belcher: Agreed order that was the 15 year window that we are probably five or six years into. That is all I have.
Mr. Fredrick: Dave Fredrick, with H.J. Umbaugh
Good to see you all. Christina is working on the rate study and that she was here this week meeting with Wes and she gave me some preliminary results just before the meeting right now. I think that maybe we can, hopefully tomorrow we can maybe set out a draft copy of our analysis too give you what our preliminary surroundings are and so forth. I think we are getting pretty close; I'd just like to take a little closer look at it. One of the biggest things that we are trying to look at right now is what we have want to assume for the future revenues from the Department of Correction, that has a lot, there are a large user of the Town's sewage system and water. They especially with all of the ground water they had and if they are going to get rid of this ground water then their billing is going to be different. Christina is putting the report together pretty well and we are hoping to get that draft copy out tomorrow, it has several assumptions we'd like to have everybody take a look at regarding what the revenues we are projecting for the Department of Corrections and we have incorporated the 2.5 million dollar loan from the revolving fund at 2.48 percent. We are pretty close and hoping to get something to you tomorrow.
Mr. Carlucci: Except what goes on at Buchanan Street, which we think will stay no matter what, if they continue working on these numbers, you are going to be setting a date here soon to meet with the Department of Corrections. We need to find out, we have to make our presentation and indicate what we want from this and find out what their tolerance level is and maybe at the end of the day it won't work at all or it will be a great project for the Town and we will have an additional benefits that we think are unrelated to the water and sewer, this is what we are trying to get at.
Mr. Kirchoff: Were there anything in Christina's analysis to date that should be of a concern to us?
Mr. Fredrick: I would say that the one thing is that the revenues from the Department of Corrections a couple of years ago where they made like 1.3 million.
Mr. Kirchoff: My assumption is even that number was wrong.
(Inaudible)
Mr. Brandgard: It sounds like that number is pretty close to this year. So in actual fact from a revenue standpoint we are already experiencing a reduction.
Mr. Fredrick: I think we can send out the draft and that is the most critical thing I think. When we did the last rates we always tried to include that higher, but we didn't factor in additional debt where the new loan and with the State's revenues down a little doesn't help either. One of the reasons you adopted the ordinance tonight was is that the interest rate on the SRF loan changes quarterly and so the interest rate right now is the lowest that is has ever been for the State Revolving Fund and that was one reason if you close before the end of the year you can lock in that interest rate, so it will change, but interest rates are still very low. Even if you do have to close later after the first of the year interest rates have the potential to change but I don't think it is probably going to change, I guess I can't estimate what is going to happen but I don't think right now it is going to be a huge change. I just wanted to throw that in, thanks.
Mr. McPhail: Seems to me that if we adopt this ordinance tonight, we take bids on the 13th is that right? If we have a problem we don't have to accept bids and move forward in construction at this point right? If we end up with this funding project doesn't work.
Mr. Belcher: That is also why we have the alternate to be able to go forward with the key part of the project and still have a project. One thing to add to your question Mr. Kirchoff, not only has the draught affected the lowering of revenue and lowering the flow from that facility, they vacated the Pref facility December of last year so that whole facility has been vacant for a year.
Mr. Brandgard: Which they said they will start filling in the spring. The other piece of it is if this goes like we think it does, we might have the ability to sell water, which will increase water revenue, so there may be an offset in there somewhere.
Mr. Kirchoff: If any of this falls apart, let's say we don't get the DOC thing done by the end of the year, which we probably won't, what happens to the bond ordinance then?
Mr. Fredrick: The bond ordinance will still be in place and if we reach a deal with the Department of Corrections in January or February, assuming that the SRF, the State still has the money available for the forgivable loans we would be in the same position.
Mr. Bennett: Is it my understanding the SRF is committed to this even after the first of the year?
Mr. Fredrick: If it closes next year the only thing that will change would be the interest rate and the forgivable loan portion there is no interest on that.
Mr. Brandgard: And without the forgivable loan we wouldn't go forward in all probability with the DOC portion. I think the big advantage to the Town right now the way this is it will allow us to gain the capacity back in the north plant that we lost due to the in flex of water that we usually have out there, this years hopefully we have a ratio in the rain sequence. I don't like the fact of having to fill plant capacity to treat good water.
Mr. McPhail: Tim, it is my understanding if we get this project done does that eliminate that over flow?
Mr. Belcher: The State doesn't have an overflow but if…
Mr. McPhail: Our overflow, our project.
Mr. Belcher: No, it wouldn't be the completion of all of our CSO work but again it would take one large contributor to the problem and fix that part of the problem.
Mr. McPhail: So we could still have some kind of combined coming in.
Mr. Belcher: Yes, I think we'd still have some on North Mill and some other areas and we are trying to get it narrowed down to a smaller area. Just to give you an example over the weekend we had the rain through the holiday there which I think was two to three inches maybe over three days, normally we would get a pretty lengthy overflow which is allowed by the permit and everything but I think the time was a matter of minutes it actually overflowed on Buchanan Street, which is tremendous improvement of all of the things we've been doing and all of the other projects we've done in the past five to ten years are beginning to show in the lack of overflow which is the goal of the agreed ordinance required by the agreed ordinance, so we are making progress on that.
Mr. Carlucci: There are a 106-107 communities in Indiana that have a Federal Court agreed order to separate their storm water from their sanitary water, we are one of those communities. The projects that we've already done and the projects that we are looking at doing, I don't know if you know the percentage of what we would have left to do if we got 75% of this done at least 75%, so we've got a pretty good jump on that part of it with ten years to go.
Mr. Brandgard: And as usual we've got the big items, and the smaller items always come harder and more expensive.
Mr. McPhail: I certainly can't find any reason why we shouldn't move forward, so if you are ready for a motion I guess I will make one. I would move that we approve Ordinance No. 19-2010, an ordinance authorizing the acquisition, construction, installation, and equipment by the Town of Plainfield, Indiana for certain improvements and extensions to the Towns sewer works, the issuance and sale of revenue bonds to provide funds for the payment of the cost thereof and the issuance, sale, and bond anticipation notes, the anticipation of the issuance sale, and the collection and segregation and distribution of the revenues of such sewage work and other related matters. Is that good enough?
Mr. Brandgard: That is good enough, in fact that will stand as that is the only time paragraph will be read.
Ms. Whicker: Second.
Mr. Brandgard: We have a motion and a second to approve the first reading of, this is a three reading ordinance, the first ordinance of Ordinance of 19-2010 ordinance for the sale of bonds and the collection of segregation distribution of the revenues of such sewage works and other related matters, if there is no further discussion, roll call vote please.
First reading of Town of Plainfield Ordinance No. 19-2010 is approved.
Mr. Brandgard: I will entertain a motion to suspend the rules to allow the second reading and the third reading in adoption.
Mr. Kirchoff: So move.
Ms. Whicker: Do we need to fill a date here on page 2, November that would be our last Town Council meeting?
Mr. Brandgard: That will be taken care of by the attorney's. All the blank spaces will be taken care of as soon as you know what those dates are.
Mr. McPhail: I second the motion.
Mr. Brandgard: We have a motion and a second to suspend the rules to allow the second reading and the third reading of adoption of ordinance no. 19-2010, if there is no further discussion, roll call vote please.
Motion to suspend the rules and move to the second and final reading of the ordinance no. 19-2010 is approved.
Mr. Brandgard: Thank you. I will entertain a motion to approve the second reading.
Mr. McPhail: So move.
Mr. Kirchoff: Second.
Mr. Brandgard: We have a motion and a second to approve the second reading of ordinance no. 19-2010 and if there is no further discussion roll call vote please.
Second reading of Plainfield Town Council ordinance 19-2010 is approved.
Mr. Brandgard: Thank you. Now I will entertain a motion to approve the third reading and adoption of ordinance no. 19-2010.
Mr. McPhail: So move.
Ms. Whicker: Second.
Mr. Brandgard: We have a motion and a second to approve the third reading and adoption of ordinance no. 19-2010. If there is no further discussion roll call vote please.
Third reading and adoption of ordinance no. 19-2010 is adopted.
Mr. Brandgard: Thank you.
Mr. Kirchoff: I guess since we are moving this direction is, how soon do think we can get with DOC and have our first face to face?
Mr. Belcher: Just yesterday I provided Mel with a paragraph that is the one of the key paragraphs on the rate that we want to propose for them and it probably has a lot of work left on it, but once that is done if you would really like to get together with the two Council members who agreed to be the ones to inform the rest of the Council to go through the complete package of the offer and then hopefully strategize on what the best way to deliver that offer. So it would be great if we could get there this week or next week.
Mr. Daniel: This afternoon I sent out new revisions including those sections and that sort of thing so I think we will probably be in a position to meet with our group here tomorrow or Friday if everybody is available to go through those.
Mr. Belcher: Dave Lahey, I'm sure he would make himself available I would expect.
Mr. Kirchoff: Friday would work for me.
Mr. Brandgard: Friday works in the morning.
Mr. McPhail: It works for me.
Mr. Belcher: It works for me too. I can go through with you on Thursday Rich. If Mel's got it already done or tomorrow we could go through it.
Mr. Carlucci: I've gone through most of the other items.
Mr. Kirchoff: The only appointment I have is a luncheon on Friday so earlier the better on Friday will work for me.
Mr. Belcher: How about 8:30, here.
Mr. Kirchoff: If that doesn't work, just let us know.
Mr. Belcher: That is fantastic; I didn't know that Mel had got the revisions up.
Mr. Kirchoff: I got an email this afternoon but I hadn't had a chance to read it so I didn't know exactly what it was, but great.
Mr. Belcher: That will be great if we can get through it and Friday and everybody's got a consensus and it will be the very following week I'd say get with Kevin, or the appropriate person to get with and get this in front of them.
Mr. Kirchoff: As we have said before if Council members have any questions or ideas, don't hesitate to call either one of us. I think it is looking good.
Ms. Whicker: How many pages was that attachment that you sent earlier today?
Mr. Daniel: I can just give you a copy; I brought some extra copies with me.
Ms. Whicker: You underlined what was changed?
Mr. Daniel: Yes.
Ms. Whicker: If you don't mind if you could just clarify just so in the future I can make sure I have my ducks in a row, did we set up this executive work session or meeting during our last Town Council Meeting?
Mr. Kirchoff: No.
Ms. Whicker: Could you remind me, I put it on my calendar I want to make sure I am getting information from you.
Mr. Brandgard: It was a called meeting, I think last Wednesday.
Ms. Whicker: Who sent that if you would, because I did not receive it, I found out today about 3:00 and so I just want to make sure that I am in the loop?
Mr. Carlucci: About this meeting? I sent that out.
Mr. Brandgard: I thought Mel sent it out too. Andy sent it too.
Ms. Whicker: I have never received an email from Andy, and I just want to make sure that in the future…
Mr. Brandgard: Let me close the meeting and then we will go there. One thing, Kent sent a message and wanted to see if we could set a date for an executive session to discuss appointments, and we will do that before the next meeting. I mean earlier the day right before the meeting, 6:00. I entertain a motion to sign the documents requiring signature and adjourn.
Mr. McPhail: So move.
Mr. Kirchoff: Second.
Mr. Brandgard: All those in favor signify by aye, opposed, motion carried, and thank you.