To: Honorable Mayor and Members of Town Council
From: Mark Marlowe, P.E., Utilities Director
Trish Muller, Finance Director
Matt Benak, P.E., Water Resources Manager
Kurtis Cotten, P.E., Water Resources Program Analyst
Title
Ordinance Approving the Eighth Amendment to the 2016 Budget and Authorizing Changes in Appropriations for year 2016 to accommodate the Purchase of Water Infrastructure Assets and Water Rights, Providing for its Emergency Adoption on Second and Final Reading (Second Reading) (Approved on First Reading on November 1, 2016 with a vote of 7-0)
Body
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Ordinance was approved on First Reading on November 1, 2016 with a vote of 7-0 with no changes.
Executive Summary
The Town of Castle Rock Utilities Department, Castle Rock Water, is requesting the appropriation of funds to accommodate the purchasing of United Water and Sanitation District’s infrastructure and water rights in Douglas County. This purchase would include a diversion structure located downstream of the confluence of East Plum Creek and West Plum Creek that could be used in place of constructing the planned diversion structure (CR-2) which is currently in planning stages on East Plum Creek, north of Town just downstream of the Plum Creek Water Reclamation Authority outfall.
Benefits of purchasing this infrastructure in place of constructing CR-2 include:
• The Plum Creek Diversion is existing, and thus, will not have to be permitted by the U.S. Army Corps of Engineers;
• The purchase includes the Ravenna Pipeline, which will provide added capacity
• The diversion can capture West Plum Creek and East Plum Creek water rights and has a 40 cfs (cubic feet per second) capacity
• The Plum Creek Diversion also has an existing 240 acre-foot water storage reservoir, expandable to 1,500 acre-feet, and
• The location of the diversion will allow for an improved water quality relative to water taken out of the stream at the CR-2 location.
(Attachment B) includes the supplemental appropriation items and (Attachment C) details estimated ending funds available for 2016.
Discussion
The infrastructure that is requested to be purchased includes the Plum Creek Diversion, pump stations, 240 acre-foot Sutton Reservoir, the Ravenna Pipeline, and three Bell Mountain wells with a pipeline system to convey water discharged from the wells to East Plum Creek. Capacity reserved for the Ravenna Metropolitan District includes 800 gallons per minute and a maximum annual delivery of 424 acre-feet in pumping and pipeline infrastructure. The location of the infrastructure is shown in Attachment D: Infrastructure Location Map.
The Plum Creek Diversion has 40 cfs of total capacity with 1.8 cfs reserved for Ravenna Metropolitan District. This is equivalent to 1.8 times the maximum daily demand for Castle Rock and four times more than CR-2 will likely permit for.
The fact that this diversion is existing and already permitted will allow the bypass of an arduous permitting process through the U.S. Army Corps of Engineers required for CR-2. CR-2 would be located on East Plum Creek, making it impossible to directly divert our West Plum Creek water rights. The Plum Creek Diversion is located downstream of the confluence of East Plum Creek and West Plum Creek, allowing us to capture the West Plum Creek water rights in addition to the East Plum Creek water rights that CR-2 would capture. The location of the Plum Creek Diversion further downstream than CR-2 also results in an increased distance from Plum Creek Water Reclamation Authority’s outfall, improving water quality and potentially delaying or reducing future improvements at Plum Creek Water Purification Facility to address contaminants of emerging concern.
Sutton Reservoir is currently 240 acre-feet in size with easements for the construction of an additional 1,500 acre-feet of storage. Temporarily storing diverted water in the reservoir prior to pumping back to Castle Rock will take the place of the pre-sedimentation basin that would be required with the CR-2 diversion.
The Ravenna Pipeline is approximately 12.5 miles long and 16 inches in diameter with the capacity to move 3,400 gallons per minute of water. The pipeline could potentially be extended approximately 1,000 feet to the South Platte River which will allow Castle Rock to divert future water rights directly from the South Platte.
The Bell Mountain wells that are included with this purchase are currently utilized to supply water to Ravenna Metropolitan District and as augmentation water for the Town of Lochbuie’s Beebe Draw well pumping depletions. These are Denver Basin wells that could also potentially be discharged into the creek and diverted at the Plum Creek Diversion, also known as CR-1. The infrastructure to convey the well discharge to East Plum Creek is existing and included with this purchase.
This purchase will also include Bell Mountain and Cherokee Ranch groundwater rights. The total unallocated groundwater to be purchased is 5,292 acre-feet per year that could potentially be leased to other entities, or be used to protect the Town’s deep aquifer supplies. If this were a development, this would equate to enough water for 4,811 SFEs utilizing the Town’s water dedication code. See (Attachment E): Groundwater Asset Location Map for the location of the groundwater assets.
The changes of appropriation in this proposed Fourth Budget Amendment include items requested for consideration for supplemental appropriation. (Attachment B) includes the supplemental appropriation request.
Budget Impact
The purchase of United Water and Sanitation District’s infrastructure and water rights in Douglas County requires an amendment to both the Water Resources Fund Budget and Water Fund Budget and transfers within the Water Fund. $10.5 million could be appropriated from the Water Resources Capital Reserve for the infrastructure component of this purchase. For the groundwater rights portion of the purchase a total of $12 million is required. $10,441,997 could be appropriated from the Water Fund Capital Reserve and the remaining amount needed, about $1.6 is currently appropriated and available for use within the Water Fund.
As presented in (Attachment C), the Finance Department has ensured that funding is available within the fund balance of each fund. A summary of the proposed total change in 2016 expenditure appropriation changes by fund is shown in the following table:
The total cost for CR-2 is estimated to be comparable or more than the total cost for the Plum Creek Diversion in Sedalia.
Staff Recommendation
On October 26, 2016, Utilities Commission recommended that staff bring forth the budget amendment to Town Council for the requested purchase of the United assets in Douglas County.
Staff recommends that Town Council approve the Ordinance on first reading. Staff plans to bring the second reading of the Ordinance to the November 15, 2016 Council meeting.
Proposed Motion
“I move to approve an ordinance approving the eighth amendment to the 2016 Budget and authorizing changes in appropriations for year 2016 to accommodate the purchase of water infrastructure assets and water rights, providing for its emergency adoption on second and final reading.“
Attachments
Attachment A: Ordinance
Attachment B: Requests for Supplemental Appropriation
Attachment C: Estimated Ending Funds Available for 2016
Attachment D: Infrastructure Location Map
Attachment E: Groundwater Asset Location Map