June 29, 2006

By Diane Chiddister

Newer and bigger pipes to make the Village water system more reliable and more able to fight fires, especially downtown. An evaluation of the water treatment plant. An upgraded electric substation to prevent voltage disruptions.

At the Village Council meeting Monday, June 19, Village Manager Eric Swansen presented future capital projects as priority needs for the Village’s water and electric utility systems.

The presentation was a discussion item only, and was part of a multi--meeting review of possible new revenues and upcoming expenses for the Village. The review was requested by Council at a special meeting on May 6 as part of a process to determine how best to address the almost $1 million shortfall in the current Village budget. At the June 4 Council meeting, Swansen reviewed potential new revenue sources, including increased income and property taxes, and he also reviewed the cost savings involved in cutting current services, such as police dispatching, the Gaunt Park pool or park maintenance.

At Council’s next meeting, on July 3, Swansen will review capital needs in the sewers and streets departments.

The Village’s first priority in the water system should be replacing old and outdated pipes, Swansen said. Many pipes in the village are too small, and larger pipes would increase reliability and also enhance the Village’s ability to fight fires. Old pipes also contribute to water line breakages, such as one that took place Friday, June 16, near Xenia Avenue and Spillan Road. That breakage resulted in a loss of 420,000 gallons of water and required about 200 residents to boil their drinking water for several days, until the water was determined to be safe, according to Swansen.

The water lines in that section of town are the first priority for replacement, he said. The Spillan area is especially vulnerable because it’s a bottleneck where older and smaller pipes are joined with larger pipes so that increased pressure occurs, according to Swansen. Other priority areas for water line replacement are King Street, the Corry/Dayton/Xenia Avenue area downtown and Xenia Avenue near Davis and Livermore Streets.

The second priority project in the water system is a study of the Village’s water treatment plant, Swansen said.

“We need to make sure what we’re doing is compliant with current and future regulations and requirements,” he said.

Especially worrisome is the Village’s use of chlorine gas to disinfect the water, according to Swansen, who said, “It’s a gas waiting to escape. It’s a concern.”

The cost for addressing these projects would be an estimated annual expenditure of $360,000 over a 10 year period, he said. In a written report, Swansen emphasized that the estimates are rough ones and that “the only certain way to know what a project will cost is to complete it. All other efforts are estimates that are based on a number of assumptions that may or may not prove to be accurate.”

A possible source for funding for the water projects would be to take on a 20-year loan and to pay financing costs with an increase in the billing rate for water consumption, an increase in the base water rate, or a “hybrid” increase based on both consumption and base rate, Swansen said. For example, if the Village takes on a 20-year loan to fund the water capital needs, the Village could pay back financing costs with an increase in the base rate from the current base rate of $6.80 to $20.24, while maintaining the current consumption rate of $3.45 per 1000 gallons of water usage. Or, the Village could choose to pay financing costs by maintaining the current $6.80 base rate and increasing the consumption rate from $3.45 to $4.30 per 1000 gallons.

Yellow Springs rates for water usage are colored by the village’s low elevation, and the need for the system to “pump and push the water more than most communities in the Dayton area,” Swansen said.

“I want to dispel the notion of why rates are high. There is a physical reason why they are,” he said.

The Village’s most important capital project in the electrical system is to upgrade the Fairfield Road substation to maintain sufficient voltage and ensure reliability, Swansen said. The substation is the facility through which the Village receives its electricity from DP&L.

While the village population has declined in recent decades, villagers’ use of electricity has steadily increased due to people’s reliance on technology, and the old substation will not be reliable much longer to deliver electricity during peak periods, Swansen said. If the system isn’t upgraded, problems maintaining the voltage will be seen within two years, and will become a regular occurance within eight to 10 years, Swansen said. He emphasized that such voltage disruptions would undermine Yellow Springs in its attempt to attract new businesses.

The estimated cost to upgrade the substation would be $3.34 million, he said.

That amount “is needed right away,” Swansen said. “There is no way to raise the rates fast enough.”

The only way to meet the need is to take on debt, according to Swansen, who said that there are various options for repaying the debt. The Village could repay the debt over a 20-year period, with higher electricity rates paying off the financing costs, he said.

“I’m not in favor of any debt, but if we take on debt we should take it on in the enterprise funds,” he said, because the utility rates can be adjusted to address the financing costs.

The Village also needs to start planning for and setting aside money for rebuilding its electrical system, he said.

Contact: dchiddister@ysnews.com