HomeMy WebLinkAboutMinutes-10-10-74-Adjourned Regular MeetingMINUTES OF THE CITY COUNCIL
OF THE CITY OF DOWNEY
ADJOURNED REGULAR MEETING
OCTOBER 10, 1974
The City Council of the City of Downey held a regular adjourned meeting
at 5:30 p.m., October 10, 1974, in the Council Chambers of the Downey City
Hall, Mayor Richard M. Jennings presiding.
- PRESENT: Councilmen: Walter S. Temple, Donald H. Winton, Hazel N.
Scotto, Richard M. Jennings
ABSENT: Councilmen: Joseph E. DiLoreto (arrived at 5:45 p.m.)
ALSO PRESENT: Charles W. Thompson, City Manager
Ervin Spindel, Director of Community Development
Richard D. Patton, Director of Finance
Robert L. Shand, City Clerk -Treasurer
WATER BOARD Scott Temple, Chairman
MEMBERS Joseph Davis
PRESENT: Mike Huggins
Irving Rosen
ABSENT: Warren Heer (arrived at 5:40 p.m.)
Mayor Jennings introduced the consultants from the firm of Wilsey & Ham,
Mr. Ray Heidrick and Mr. Peter VanRiper. He explained this is an adjourned
regular meeting and said the study session would be conducted as a question and
answer program because the consultants have already made a water systems study
presentation to the Water Board.
The study session commenced by reviewing the Wilsey & Ham Preliminary
Appraisal of Water Systems report dated April, 1974. Each of the fourteen
chapters was perused by the City Council and Water Board members. Mr. Ray
Heidrick explained the report subjects and answered questions from the group
Mayor Jennings pointed out that paragraph 2 on page 1 of the Report is not
pertinent to this report because the indicated 5% annual rate increase was not
used in any of the projected tables, including Table 19.
Mr. Heidrick explained Tables 1, 2, and 3 as being indications of the
"Market Place" and a measure of premiums paid for water systems during the past
year. He also explained the various regulatory agencies for water systems as
well as the Home Rule concept.
Mr. Warren Heer arrived at the meeting at 5:40 p.m.
Mr. Hedrick outlined various methods for negotiating the purchase of water
systems, including information on financing.
Councilman DiLoreto arrived at the meeting at 5:45 p.m.
Councilman DiLoreto inquired regarding condemnation costs and the projec-
tion of various attorney fees.
Mr. Hedrick referred to page 84 in reply to Councilman DiLoreto's questions.
Community Development Director Spindel explained Table 19 and said based on
present rates, no rate increase would be required until 1980-81 for the newly -
acquired systems; that no rate increase would be required until 1982-83 for the
combined systems.
Discussion followed on benefits to be realized by acquiring systems within
Downey.
Councilman Winton raised questions relative to $5,340,800 preliminary esti-
mates and the feasibility of the acquisitions to be considered.
Consideration was also given to inventory of assets above and below ground.
Council Minutes 10/10/74 -1-
Councilman DiLoreto asked one of the consultants to outline the procedure
used for physically examining the water systems under consideration for acquisi-
tion, as well as the estimated costs for upgrading the systems to the anticipated
level of service for the Downey water consumers.
Mr. Heidrick discussed the value of the system and what the court would
require for valuation information. Mr. Heidrick stated that their preliminary
report did not call for evaluating the system.
Mayor Jennings inquired about "age -of -pipe" consideration.
Mr. Heidrick said age -of -pipe does not necessarily indicate extent of
rotted pipe.
City Manager Thompson commented on a Phase II study that would be compre-
hensive and detailed analysis of the system which may or may not be necessary,
depending on the outcome of the feasibility study.
Councilman Winton said the report, so far, has indications that the water
system program is feasible, assuming a cost of $5,340,800. However, he stated,
if additional expenses might raise the cost to $8,000,000, then the program is
no longer feasible.
Discussion followed regarding the cost of a Phase II study, including
operating expenses, and the assets that would be acquired in the expansion
program. Inner -connections between the systems were mentioned.
Community Development Director Spindel was asked to review Phase I and
Phasell as to costs.
Mayor Jennings commented that the Preliminary Appraisal Report fairly well
covers Phase I.
Methods of depreciation for water systems and the services of actuaries for
evaluating utility properties were discussed.
Mr. Heidrick said the acquisition program would include Park Water Company
water rights within Downey. He added that no major problems existed in the
water systems except with two shallow -main situations in the southwest and
northeast portions of the City.
Discussion followed regarding a water main loop completely around the City
to assure constant water supply for all areas within Downey. It was noted the
Phase I report calls for three additional water wells.
Mayor Jennings inquired if the City's computer system will be able to
accommodate the increased water consumer load for invoicing and accounting pur-
poses.
Finance Director Patton said the system has the capacity for the additional
load.
Water Board Chairman Temple mentioned there would possibly be a requirement
for having additional shift hours for water billing purposes.
Mayor Jennings asked if the City would have to purchase real property (land)
within Downey now owned by the other water companies.
Mr. Heidrick said no real property or building acquisition is included in
the feasibility study.
Councilwoman Scotto inquired about the cost basis used for establishing the
water rates.
City Manager Thompson explained that the water program is a separate enter-
prise fund and includes costs for buildings, office space, and administration,
and the office/administration costs are prorated on a percentage basis.
Mr. Heidrick recommended Procedure G as the next step toward acquisition
(page 83 of the Report).
Council Minutes 10/10/74 -2-
Mayor Jennings inquired when election would be held for the bonds.
Mr. Heidxick said paragraph 5 would apply, the election would be Citywide,
and the timing of the election would depend upon the negotiation proceedings.
Councilwoman Scotto raised questions regarding source of water supply.
Mr. Spindel explained existing wells and the MWD supply. He also explained
replenishing of underground water supply by MWD and the effect of MWD water upon
the quality of the City's well water.
Mr. Rosen of the Water Board summarized the efficiency of the Downey City
Water Company operation and that it has not sought a water rate increase at all
in the past year. He said one of the other water companies has already had a
rate increase and is applying for another.
Mayor Jennings thanked the firm of Wilsey & Ham for the hearing and also
thanked the Water Board for appearing.
Mayor Jennings said this is an adjourned regular Council Meeting, and he
asked the Council to recess into an Executive Session.
Department Heads were excused and the City Manager was asked to join the
Council in a few minutes.
At the end of the Executive Session, the Mayor adjourned the Council Meeting
at 8:45 p.m.
Ro ert L. Shand, City Jerk -Treasurer
Council Minutes 10/10/74 -3-
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Ri is M. Jenningsplayor