by Neil Richard
The King George County Service Authority Board of Directors opened their meeting at 6:31pm.
There were no amendments to the Agenda.
Mike Bennett, Chair, opened the meeting by informing everyone that this would be the third meeting in a row with a Public Hearing. He said the first hearing was regarding the 10% increase in rates for the coming year but because it wasn't sufficiently advertised, another hearing had to be held at the last meeting. Bennett said tonight's hearing was for the overall five year rate plan which included additional rate increases. He said the previously published newspaper article was incorrect in stating that the ten percent increase would be every year for the next five years. Instead, he said, next year's rate was already approved to go up 10%. The following years would increase 4%, 4%, 4%, then finally 3%. Bennett said the five year rate plan was required by Virginia Resources Authority (VRA) as a part of the Service Authority's plan to restructure their debt. He said the restructuring would allow for lower debt payments in the short term to allow for needed repairs and maintenance to be paid for. He reminded the audience that they would have two opportunities to speak, first at the beginning of the meeting, then again during the Public Hearing portion. He said because of the full Agenda and the Board of Supervisors meeting that followed, he would be strictly enforcing the three minute limit. He then opened the floor for comment.
There was no Public Comment.
Chris Werle gave a brief report that the Virginia Marine Resources Commission (VMRC) approved and issued the permit for the Fairview Beach riverbank stabilization project. Werle said he thought that should be the last permit needed but Bennett added that the Army Corps of Engineers should still have a final say. Bennett jokingly chided Werle for forgetting them, especially since he was a former member of the group, and Werle chuckled and said "shame on me."
Richard Granger and Cathy Binder had no report.
Ruby Brabo said that she learned about a joint agency initiative between Federal and local governments at a recent meeting at Fort A. P. Hill. She said a workshop would be held in August.
Mike Bennett said that for years he has been involved in finding the contamination problem in Fairview Beach. He said that he had two points to clarify. First, he said the water that is contaminated in the Potomac River is not the drinking water from the Service Authority. Second, the funds being used by Tri-County/City Soil and Water to track the source was actually money paid to them by the Service Authority as a penalty in years past. He said that it wasn't a good thing that the Service Authority had to pay a penalty but it was good that the money ended up coming back to help them.
The Consent Agenda was approved.
The County Attorney, Eric Gregory, had an update on the lease agreement with KGI Communications. He said once the Public Hearing was held by the Board of Supervisors, the terms will be finalized. Bennett added that the contract had pretty much been approved a year ago but KGI had to wait on the FCC to get approval for their specific frequencies. There were also some minor changes to be made in the contract as well as adjusting for KGI not being able to provide free internet at the Dahlgren Waste Water Treatment Plant (WWTP) because of the proximity to the Navy base in Dahlgren.
The Public Hearing for the five year rate structure was next on the agenda. The only person to speak during Public Comment was Miriam Niemi who asked if the Board had thought about a monthly payment cycle for Service Authority bills instead of the once every two-month cycle currently in use. She said the current method doesn't really work for budgeting.
With no other comments, Bennett said that the Board has considered it and discussed it in the past. He said they have tried to make it clear what the monthly changes would be for the new rate increases and that generally speaking, all of them were in favor of a monthly bill. Bennett said it's not as easy as it sounds though "since we're the government" but the Board was thinking about it. Brabo added that the current accounting software used for billing can't do monthly bills.
Jonathon Weakley, General Manager, then gave a brief overview of the five year rate plan. He thanked the Board, the citizens that volunteered for the Citizen Budget Advisory Committee, and Davenport and Associates for their help. Weakley said that the plan helps free free up funds in the near term as well as restructures the debt over time. He said that the rates would still be reviewed every year to make sure the proper thresholds are met. [EDITOR'S NOTE - Neil Richard, a co-founder of Project94, was a member of the Service Authority Citizen Budget Advisory Committee.]
Bennett added that everyone on the Citizen Budget Advisory Committee was a Service Authority customer and all were in favor of the planned increases. He said the Service Authority needed to get their financial house in order as well as get facilities into compliance. He said part of that would be rate increases, but part would also be restructuring or refinancing the debt. He added that the rates can be changed annually but the VRA requires the plan to be in place before restructuring can occur. Weakley added that the VRA resolution would be later in the evening. The five year rate plan was approved.
Next was the Debt Restructuring presentation by Sands Anderson and Davenport and Associates. Due to technical issues, the presentation was not visible on the projector however it mirrored much of what was presented in previous budget meetings. The biggest change was the inclusion of more precise dollar amounts. With the Board already approving the five year rate plan, the two items left that Davenport asked the Board to act on were the approval of the resolutions later in the meeting and the approval to participate in the Summer 2019 VRA Pool.
Going into more detail about the debt restructuring, not all of the debt would be refinanced. Of the roughly $25 million in total debt, the Service Authority would refinance about $16 million. This would free up about $1 million per year in cash for the Service Authority to use for necessary repairs and maintenance. Bennett asked where grant money would fit into the process and Davenport said it would only make things better. Grant money was not factored into the plan as it wasn't a definite but it would certainly help. Bennett also asked about the Debt Service Coverage ratio, which is the cash to debt ratio. VRA only requires a ratio of 1.0, or $1 dollar of revenue for every $1 dollar of debt, but the plan from Davenport put the ratio at 1.22 or higher, meaning there was a plan to have more revenue than debt.
Bennett commended Davenport for their hard work and timely responses. He said he was really impressed by how fast things were turned around. Bennett said he wasn't impressed by how many problems the Service Authority has but was impressed by how many solutions Davenport was able to come up with.
In addition to the debt restructuring and long term rate plan, the Service Authority will also seek a line of credit. The idea is to have the flexibility to draw money to pay for projects that currently have an unknown cost. While grants may cover these costs, known issues don't have an assigned cost yet and new problems may arise. The final task for the Service Authority is to adopt updated financial policies.
Weakley asked about the line of credit and what the draw down schedule would look like and if there would be a fee for taking no money out or less than the minimum. Because every bank has different rules, Davenport said it was an unknown right now but as proposals came in for the line of credit, those questions could be answered.
Moving on with the Agenda, Wilma Ward, Director of Finance, asked for the adoption of the FY2019-2020 Operating and Capital Budgets. It was approved.
Next, Werle gave a brief update on the Fairview Beach riverbank stabilization project. He said that the Federal Emergency Management Agency (FEMA) has the project in their hands going on six months and will require an environmental assessment to be done. Werle said FEMA told him that process could take another six months and that, because the area was already at risk, he suggested paying Schnabel Engineering to conduct the study since they would be able to accomplish it faster. Werle said that some grant money is available to pay for it and that it would only take one big storm to wash things away and that the sewer line would be the first thing to go. The Board approved.
Next was the approval of the VRA Resolution. As requested, there was a roll call vote, an odd procedure where every member casts their vote individually.
Weakley then presented his request to enter into a contract for water tank maintenance. He said there was one in the past but it lapsed at some point and was never renewed or replaced. Weakley said that adding the required chlorine to the water has an adverse impact on the tanks if they are not properly maintained. He said the proposed contract was for nine years with the ability to expand out to 15 years. His objective was to approve the contract as soon as possible in order to get the company started on the Purkins Corner tank so there was enough time to finish before school started in the fall. The Board approved spending $67,450 for the first year of the contract.
Weakley then presented his General Manager's report. He thanked Eric Gregory and Lavita Cobb for their help in getting the water tank maintenance contract completed.Weakley continued by saying he's had some developers knocking on the door asking about the the capacity of the Courthouse water system and he wanted to make sure that the Service Authority stayed within the daily, monthly, and yearly withdrawal limits on the permit. Brabo asked Werle if there were negotiations or future planning done for the Courthouse permits to allow for future development in the area. Werle said he had not been involved with the process. Brabo said that it may be safe to assume that taking future development into consideration wasn't done and it may cause future growth to be restricted. Werle said that modifications to the existing permit can be applied for and that development would be a valid reason to do so.
Weakley continued his report saying that the annual Consumer Confidence Reports had been mailed and notification was sent to the Virginia Department of Health (VDH) as required. Lead and copper sampling plans were also sent to VDH for approval. He said the Courthouse water system would be flushed in the near future and alerts would be sent via the KGAlert system.
On the waste water side of the Service Authority, Weakley gave updated numbers for the Total Nitrogen (TN) and Total Phosphorus (TP) for all five waste water treatment plants (WWTPs). Dahlgren WWTP was over the permitted TN limit of 3.0 mg/L with 4.7 mg/L for the year. He did say that the preliminary numbers for the last few weeks looked much better and that the improvements to the "recipe for success" would be put into writing so that current and future staff would know what needed to be done. Purkins Corner WWTP was the only other facility to be over their allowed amounts. With a permitted level of 10.0 mg/L TN, the year to date amount was 10.7 mg/L. Weakley said that this was largely due to mechanical issues earlier in the year and that new mixers had been installed and more were on the way. Weakley also noted that the Oakland Park WWTP was still seeing darker effluent and that it was still being investigated to find the source. He also said that the new employee at the facility was doing a phenomenal job and noted that Mr. Turner was excited and absorbed everything he learned. Weakley thanked Tim Maciejewski for helping train the new employee. Weakley said that the Purkins Corner WWTP was also being evaluated by Wiley Wilson to determine if it would be best to decommission the plant or build a new one. Bennett added that some of the analysis was already done on decommissioning Oakland Park and Purkins Corner WWTPs, but because of potential development in the Purkins Corner area, and the amount of land available for use, there were more options available to the Service Authority. Bennett said that there's a potential for 1,400 units in the area and that the silver lining was that the Service Authority would get a connection fee for every home built.
Weakley ended his report saying he worked with the Arlington Catholic Diocese for their upcoming work camp being based at the high school.
Bennett was getting ready to close the meeting and asked if anyone had anything else to bring before the Board when Brabo mentioned the proposed meeting for July. Bennett said he would get to that in a minute then jokingly said "unless Mr. Bueche wanted to take up some of their time." After a few chuckles, Bennett went on to explain that the Board doesn't normally meet in July but that he and Werle talk nearly every day and he felt like there was enough going on with the Service Authority that it warranted a special meeting in July to stay on top of things. With that, he said the Board would meet on July 16.
There was no Closed Session.
The meeting adjourned at 8:09pm.
Meeting Attendees:
Christopher Werle (Board of Directors)
Jonathon Weakley (General Manager of Service Authority)
Richard Granger (Board of Supervisors)
Michael Bennett (Chairman, Citizen)
Ruby Brabo (Board of Supervisors)
Cathy Binder (Board of Supervisors)
Neiman Young (County Administrator)
Eric Gregory (County Attorney)
Meeting Agenda
Next Meeting:
The Service Authority will next meet on June 20, 2019 at 5:00 pm at Company 1.
Previous Meeting:
The previous Service Authority Meeting was not covered by Project94.
The King George County Service Authority Board of Directors opened their meeting at 6:31pm.
There were no amendments to the Agenda.
Mike Bennett, Chair, opened the meeting by informing everyone that this would be the third meeting in a row with a Public Hearing. He said the first hearing was regarding the 10% increase in rates for the coming year but because it wasn't sufficiently advertised, another hearing had to be held at the last meeting. Bennett said tonight's hearing was for the overall five year rate plan which included additional rate increases. He said the previously published newspaper article was incorrect in stating that the ten percent increase would be every year for the next five years. Instead, he said, next year's rate was already approved to go up 10%. The following years would increase 4%, 4%, 4%, then finally 3%. Bennett said the five year rate plan was required by Virginia Resources Authority (VRA) as a part of the Service Authority's plan to restructure their debt. He said the restructuring would allow for lower debt payments in the short term to allow for needed repairs and maintenance to be paid for. He reminded the audience that they would have two opportunities to speak, first at the beginning of the meeting, then again during the Public Hearing portion. He said because of the full Agenda and the Board of Supervisors meeting that followed, he would be strictly enforcing the three minute limit. He then opened the floor for comment.
There was no Public Comment.
Chris Werle gave a brief report that the Virginia Marine Resources Commission (VMRC) approved and issued the permit for the Fairview Beach riverbank stabilization project. Werle said he thought that should be the last permit needed but Bennett added that the Army Corps of Engineers should still have a final say. Bennett jokingly chided Werle for forgetting them, especially since he was a former member of the group, and Werle chuckled and said "shame on me."
Richard Granger and Cathy Binder had no report.
Ruby Brabo said that she learned about a joint agency initiative between Federal and local governments at a recent meeting at Fort A. P. Hill. She said a workshop would be held in August.
Mike Bennett said that for years he has been involved in finding the contamination problem in Fairview Beach. He said that he had two points to clarify. First, he said the water that is contaminated in the Potomac River is not the drinking water from the Service Authority. Second, the funds being used by Tri-County/City Soil and Water to track the source was actually money paid to them by the Service Authority as a penalty in years past. He said that it wasn't a good thing that the Service Authority had to pay a penalty but it was good that the money ended up coming back to help them.
The Consent Agenda was approved.
The County Attorney, Eric Gregory, had an update on the lease agreement with KGI Communications. He said once the Public Hearing was held by the Board of Supervisors, the terms will be finalized. Bennett added that the contract had pretty much been approved a year ago but KGI had to wait on the FCC to get approval for their specific frequencies. There were also some minor changes to be made in the contract as well as adjusting for KGI not being able to provide free internet at the Dahlgren Waste Water Treatment Plant (WWTP) because of the proximity to the Navy base in Dahlgren.
The Public Hearing for the five year rate structure was next on the agenda. The only person to speak during Public Comment was Miriam Niemi who asked if the Board had thought about a monthly payment cycle for Service Authority bills instead of the once every two-month cycle currently in use. She said the current method doesn't really work for budgeting.
With no other comments, Bennett said that the Board has considered it and discussed it in the past. He said they have tried to make it clear what the monthly changes would be for the new rate increases and that generally speaking, all of them were in favor of a monthly bill. Bennett said it's not as easy as it sounds though "since we're the government" but the Board was thinking about it. Brabo added that the current accounting software used for billing can't do monthly bills.
Jonathon Weakley, General Manager, then gave a brief overview of the five year rate plan. He thanked the Board, the citizens that volunteered for the Citizen Budget Advisory Committee, and Davenport and Associates for their help. Weakley said that the plan helps free free up funds in the near term as well as restructures the debt over time. He said that the rates would still be reviewed every year to make sure the proper thresholds are met. [EDITOR'S NOTE - Neil Richard, a co-founder of Project94, was a member of the Service Authority Citizen Budget Advisory Committee.]
Bennett added that everyone on the Citizen Budget Advisory Committee was a Service Authority customer and all were in favor of the planned increases. He said the Service Authority needed to get their financial house in order as well as get facilities into compliance. He said part of that would be rate increases, but part would also be restructuring or refinancing the debt. He added that the rates can be changed annually but the VRA requires the plan to be in place before restructuring can occur. Weakley added that the VRA resolution would be later in the evening. The five year rate plan was approved.
Next was the Debt Restructuring presentation by Sands Anderson and Davenport and Associates. Due to technical issues, the presentation was not visible on the projector however it mirrored much of what was presented in previous budget meetings. The biggest change was the inclusion of more precise dollar amounts. With the Board already approving the five year rate plan, the two items left that Davenport asked the Board to act on were the approval of the resolutions later in the meeting and the approval to participate in the Summer 2019 VRA Pool.
Going into more detail about the debt restructuring, not all of the debt would be refinanced. Of the roughly $25 million in total debt, the Service Authority would refinance about $16 million. This would free up about $1 million per year in cash for the Service Authority to use for necessary repairs and maintenance. Bennett asked where grant money would fit into the process and Davenport said it would only make things better. Grant money was not factored into the plan as it wasn't a definite but it would certainly help. Bennett also asked about the Debt Service Coverage ratio, which is the cash to debt ratio. VRA only requires a ratio of 1.0, or $1 dollar of revenue for every $1 dollar of debt, but the plan from Davenport put the ratio at 1.22 or higher, meaning there was a plan to have more revenue than debt.
Bennett commended Davenport for their hard work and timely responses. He said he was really impressed by how fast things were turned around. Bennett said he wasn't impressed by how many problems the Service Authority has but was impressed by how many solutions Davenport was able to come up with.
In addition to the debt restructuring and long term rate plan, the Service Authority will also seek a line of credit. The idea is to have the flexibility to draw money to pay for projects that currently have an unknown cost. While grants may cover these costs, known issues don't have an assigned cost yet and new problems may arise. The final task for the Service Authority is to adopt updated financial policies.
Weakley asked about the line of credit and what the draw down schedule would look like and if there would be a fee for taking no money out or less than the minimum. Because every bank has different rules, Davenport said it was an unknown right now but as proposals came in for the line of credit, those questions could be answered.
Moving on with the Agenda, Wilma Ward, Director of Finance, asked for the adoption of the FY2019-2020 Operating and Capital Budgets. It was approved.
Next, Werle gave a brief update on the Fairview Beach riverbank stabilization project. He said that the Federal Emergency Management Agency (FEMA) has the project in their hands going on six months and will require an environmental assessment to be done. Werle said FEMA told him that process could take another six months and that, because the area was already at risk, he suggested paying Schnabel Engineering to conduct the study since they would be able to accomplish it faster. Werle said that some grant money is available to pay for it and that it would only take one big storm to wash things away and that the sewer line would be the first thing to go. The Board approved.
Next was the approval of the VRA Resolution. As requested, there was a roll call vote, an odd procedure where every member casts their vote individually.
Weakley then presented his request to enter into a contract for water tank maintenance. He said there was one in the past but it lapsed at some point and was never renewed or replaced. Weakley said that adding the required chlorine to the water has an adverse impact on the tanks if they are not properly maintained. He said the proposed contract was for nine years with the ability to expand out to 15 years. His objective was to approve the contract as soon as possible in order to get the company started on the Purkins Corner tank so there was enough time to finish before school started in the fall. The Board approved spending $67,450 for the first year of the contract.
Weakley then presented his General Manager's report. He thanked Eric Gregory and Lavita Cobb for their help in getting the water tank maintenance contract completed.Weakley continued by saying he's had some developers knocking on the door asking about the the capacity of the Courthouse water system and he wanted to make sure that the Service Authority stayed within the daily, monthly, and yearly withdrawal limits on the permit. Brabo asked Werle if there were negotiations or future planning done for the Courthouse permits to allow for future development in the area. Werle said he had not been involved with the process. Brabo said that it may be safe to assume that taking future development into consideration wasn't done and it may cause future growth to be restricted. Werle said that modifications to the existing permit can be applied for and that development would be a valid reason to do so.
Weakley continued his report saying that the annual Consumer Confidence Reports had been mailed and notification was sent to the Virginia Department of Health (VDH) as required. Lead and copper sampling plans were also sent to VDH for approval. He said the Courthouse water system would be flushed in the near future and alerts would be sent via the KGAlert system.
On the waste water side of the Service Authority, Weakley gave updated numbers for the Total Nitrogen (TN) and Total Phosphorus (TP) for all five waste water treatment plants (WWTPs). Dahlgren WWTP was over the permitted TN limit of 3.0 mg/L with 4.7 mg/L for the year. He did say that the preliminary numbers for the last few weeks looked much better and that the improvements to the "recipe for success" would be put into writing so that current and future staff would know what needed to be done. Purkins Corner WWTP was the only other facility to be over their allowed amounts. With a permitted level of 10.0 mg/L TN, the year to date amount was 10.7 mg/L. Weakley said that this was largely due to mechanical issues earlier in the year and that new mixers had been installed and more were on the way. Weakley also noted that the Oakland Park WWTP was still seeing darker effluent and that it was still being investigated to find the source. He also said that the new employee at the facility was doing a phenomenal job and noted that Mr. Turner was excited and absorbed everything he learned. Weakley thanked Tim Maciejewski for helping train the new employee. Weakley said that the Purkins Corner WWTP was also being evaluated by Wiley Wilson to determine if it would be best to decommission the plant or build a new one. Bennett added that some of the analysis was already done on decommissioning Oakland Park and Purkins Corner WWTPs, but because of potential development in the Purkins Corner area, and the amount of land available for use, there were more options available to the Service Authority. Bennett said that there's a potential for 1,400 units in the area and that the silver lining was that the Service Authority would get a connection fee for every home built.
Weakley ended his report saying he worked with the Arlington Catholic Diocese for their upcoming work camp being based at the high school.
Bennett was getting ready to close the meeting and asked if anyone had anything else to bring before the Board when Brabo mentioned the proposed meeting for July. Bennett said he would get to that in a minute then jokingly said "unless Mr. Bueche wanted to take up some of their time." After a few chuckles, Bennett went on to explain that the Board doesn't normally meet in July but that he and Werle talk nearly every day and he felt like there was enough going on with the Service Authority that it warranted a special meeting in July to stay on top of things. With that, he said the Board would meet on July 16.
There was no Closed Session.
The meeting adjourned at 8:09pm.
Meeting Attendees:
Christopher Werle (Board of Directors)
Jonathon Weakley (General Manager of Service Authority)
Richard Granger (Board of Supervisors)
Michael Bennett (Chairman, Citizen)
Ruby Brabo (Board of Supervisors)
Cathy Binder (Board of Supervisors)
Neiman Young (County Administrator)
Eric Gregory (County Attorney)
Meeting Agenda
Next Meeting:
The Service Authority will next meet on June 20, 2019 at 5:00 pm at Company 1.
Previous Meeting:
The previous Service Authority Meeting was not covered by Project94.
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