GRAYS HARBOR COUNTY WATER DISTRICT #2

08/11/18

Despite what appears to be nothing but negative, a lot of good things happen. I am generally happy with the way things are going. We are getting more on top of issues, make progress in streamlining and improving processes, and continue to improve or customer service.

Budget Position Report

County reports did not arrive in time to present reconciled reports. However, most numbers are in and I expect that the reconciled reports will vary only by a few hundred dollars.

Revenues for July (actually June) were $50,516.61. Expenses were $48,969.26. At this point, we spent $1,547.35 less than we took in. That number will change when the County reports arrive.

Revenues show as slightly low, but that is because this report reflects receipts from Section 2, which are always a bit lower than Section 1. The actual July receipts, which will show up on August’s reports, were almost $60,000.

At this point we are 58% through the year. We are over budget. We have expended 61% of our budgeted funds.

It is the contractor repairs that are hitting us the hardest.

Treasurers Report:

No County reports, no Treasurer’s Report.

2019 Budget

I have made a few changes from last month. I added a column labeled “2018 Projected”. It is the revenue and expenditures I am forecasting for 2018 based on revenue and expenditures to date with some adjustments.

Column J (Budget Percent Change) is the percent increase/decrease over the previous budget. Column K (Projected Percent Change) is the percent increase/decrease over the 2018 projected numbers.

I have added revenue and gain/loss projects for increases of 8% and 10%.

Doing the projections revealed some areas that needed adjusting for the proposed 2019 budget.

I have included only the 401 Regular Maintenance Fund since it is the only fund for which budgeting can be realistically accomplished.

As more accurate historical numbers have become available to me there have been some significant changes in some line items. One instructive line item is Revenue. A 10% increase in the forecast does not necessarily translate into a 10% increase in actual revenue. We forecast $652,394 for 2017 and received $623,054. So my proposed revenue for 2019 is based on the projected revenues for 2018 rather than the forecast revenues.

The 2019 proposed expenditures include columns for the change over the 2018 budget, and the change over the 2018 projected expenditures. Generally the proposed expenditures are based on the 2018 projected expenditures.

I am hoping this is a conservative approach.

All of these numbers will come into clearer focus as the year goes on, but we need to make broad brush decisions now so that we can have an essentially finalized budget by the October meeting.

The highlights of this proposal:

• A 6% rate increase. I have included a proposed rate schedule. I have also included some numbers for an 8% and 10% rate increase.
• A full time laborer/meter reader at $15/hr.
• Two projects: The Reynvaan Extension and expanding SCADA controls. The Reynvaan Extension is a compliance issue.
• A forecast contribution to reserves of $79,845.

The most controversial element is the request for a full time laborer/meter reader.

Operational Issues

I am starting a new category, Operational Issues, that will include items that may not be of immediate concern (or may be), but are issues about which we need to be thinking.

Operational Issue #1:

There are some issues hanging out there that are not addressed in current budgeting process.

The first of those is some major repairs that have been deferred that eventually will need to be addressed. Those issues are the water mains on Fairway Terrace and Hill Road south of Central Park Drive. Those will be major expenses for which we have not identified the funds. Which is a fancy way of saying “we don’t have the money”.

Eventually they will have to be addressed.

Operational Issue #2:

We have two fairly major compliance issues. The first is what I am calling the Reynvaan Extension. That is the installation of a short water main south from the Reynvaan booster station to Highway 12. I have included that project in the proposed 2019 budget. The funds I have identified for that project ($45,000) are somewhat of a scientific guess.

My plan is to hold off on SCADA controls until we know what the Reynvaan Extension will actually cost. Some SCADA control upgrades may happen as a result of the LeMay relocation and would be paid for by LeMay.

The second is the North Bank Booster Station. That will not need to be a very large booster station. Probably something similar to the Hirschbeck Heights Booster Station. But we do not currently have funds identified for that project. From my experience with the Hirschbeck Heights Booster Station, I am thinking that $60,000 is within the ballpark. We were fortunate in being able to negotiate an easement for Hirschbeck at no cost. We might not be so lucky with North Bank. I may try and work this project into 2021.

Operational Issue #3:

There is an issue I have not plugged into the six-year budget yet, but it keeps surfacing. We use Brumfield Construction quite bit just for access to the vac-truck. I have some pretty firm guidelines for when to call for the truck. And the graph lines have not yet crossed where it would be less expensive to have our own rather than contracting it.

There are two really big advantages to the use of the vac-truck. The first advantage is in play when there are other utilities in the vicinity of the repair. In those cases we can excavate to the problem in a matter of minutes with the vac-truck, as opposed to hours of hand digging.

The second advantage arises because the vast majority of the leaks occur in service laterals. Without the vac-truck we have to isolate the section of water main from which the service lateral branches in order to de-water the leak area. The use of the truck allows us to de-water and excavate down to the corp stop, even with the leak still flowing, and turn off just the affected service. This approach not only speeds the process up, but it also eliminates all the hassles and expense associated with isolating a section of the community.

While having access to Brumfield’s vac-truck is a major benefit, there are some difficulties. The first is cost. There is an hourly charge both for the truck and an operator. Sometimes they send the vac-trailer. The cost is a wash between the truck and the trailer because the trailer has to be towed by a truck, which also incurs a charge.

The second is availability. Brumfield makes an effort to accommodate our needs, especially in emergency situations, but it is not always possible for them to respond as quickly as we would like.

I have not done an analysis of how much we spend just for the vac-truck. I think I will undertake that analysis sometime in the coming months. I don’t know if the lines on the graph will ever cross.

Operational Issue #4:

Pressures on Clemons Road continue to be a cause for comments from the community. Eventually we will need to address that problem.

The sticky issue with Clemons Road is that the water main that serves that area doubles as the transmission line from the wells to the water system. We have finally managed to get a tap on the line along Devonshire and it appears that the line is in service. We need to do one more tap to find out for sure. If we are convinced it is “hot”, I want to conduct a detailed leak survey to ensure the line is tight. That may include hiring leak detection company.

There is a tentative plan, a part of the Clemons Road Reservoir plans, to install a booster station near the reservoirs and extend the water main that proceeds east from the reservoirs to the south to serve Clemons Road. In 2007 the engineer’s estimate for that project was $1.2 million. Which included the booster station. Obviously, not a viable project.

If the Devonshire transmission line is operational, or can be made operational with little cost, then the Clemons Road water main could be isolated from the rest of the system and connected to the LeMay Booster Station. That booster station, because of the large fire flow capability it must have, has plenty of capacity to serve all of Clemons Road and the mains that branch off of it.

We would also need to have an engineer conduct a hydraulic analysis to make sure the change would not adversely affect other parts of the system.

If all the “ifs” turn into “definites”, the pressure problems on Clemons Road could be solved fairly inexpensively compared to other possible approaches.

Operational Issue #5:

The roof on the North Bank reservoir continues to be a maintenance problem. We have kept a membrane type coating on the tank in recent years. It was last removed and replaced in 2012 and is due again.

But it looks like that item will need to be deferred. It is essentially a Summer long job for two people. We are now into August. So this task will almost certainly have to be deferred.

We may want to consider contracting this task out. Water intrusion into that roof would cause us some major difficulties.

In addition, North Bank is our main reservoir level control point and the level monitoring equipment is a mishmash that has been modified, kind of repaired, and cobbled together as the control systems have evolved over the decades.

My current thinking, suggested by Joe, is that the reservoir needs a falsework roof over the existing roof and the control equipment needs to be removed and replaced with a single, logical monitoring system.

Presently, I have no idea how much all of that would cost.

Operational Issue #6:

I have concerns about the well pumps. A few years ago we rewound the motor for Well #5. It should be good for quite a few years. However, we did not pull and inspect the pump. It appears that pump was replaced in 1987. It is approaching the end of its life expectancy.

The pump and motor on Well #6 went on line in 2012. My concern is that Well #6 accumulates far more hours of operation than Well #5. So far this year Well #5 has run 552 hours while Well #6 has run 1,002 hours.

There is no real way to fix the imbalance. It results from the pumping rates of each well. The pumps are alternated as to which one is the lead pump. Well #5’s average pumping rate is just over 1,000 gpm, while Well #6 is about 700 gpm. When Well #5 is the lead pump, because of its higher pumping rate, it meets demand and fills the reservoirs faster than Well #6 when it is lead pump. Simply stated, Well #6 has to run longer than Well #5 in order to pump the same quantity of water. I have included a SCADA report in your packets so you can see what I am talking about.

I monitor average pumping rates, but it is difficult to spot trends. Variations in reservoir levels and the ups and downs of demand cause variations in the dynamic head faced by the pumps, which causes significant variations in pumping rates. Pumps perform based on the old work/power formula: Work = Force X Time, or Power = Head X Flow. Since power is a constant, any variation in head or flow will impact the other.

We monitor current draw on the Reynvaan pumps annually, as we have no other means of tracking pump condition. I will be initiating a program to monitor current draw on all pumps (including the Hirschbeck pumps) in the immediate future.

The issue being, we could very easily face some expensive pump repairs/replacement in the next few years.

Operational Issue #7:

The Reyvnaan Pumphouse. This building was a bit of a thrown together structure in the first place. The years have not been kind to it.

I think it will need to be replaced sometime in the next couple of years. It is a small building and will not be terribly expensive.

Operational Issue #8:

The controls for the Reynvaan pumps were outdated and due for replacement when NWS, Inc. first came aboard. We completed the first, and, at the time, the most urgent, issue by replacing the bladder tanks in the Bag House at the top of the hill.

But the pressure switches, contactors, and alternator are operating beyond their life expectancy. We can expect failure at any time.

I would like to inclusion of the Reynvaan controls in the SCADA system along with control updates. Some other shoes need to drop before that can happen.

End of Operational Issues

Shop Site Adjustments

The fire station improvements will require some re-arranging of the shop site. Our stock piles of rock currently reside in the area where the retention pond will be located.

We are planning to move those materials to the northwest corner of the site and contain them with environmental blocks.

Thoughts on Rates:

We have been able to raise rates annually without too much in the way of complaints from the community. I attribute that to an increased effort to communicate with the community and to the efforts to improve our services.

There may be an additional factor involved. This is not something for which I have done a formal study, but it is apparent that the rate of turnover of properties is accelerating. To put it coldly, the “old timers” are either passing away or passing on. We are seeing more folks coming into the community who are used to the higher rates charged by other water utilities.

Those factors do not mean that we can raise rates willy-nilly. Both from our customers’ standpoint, and in the view of the regulatory agencies, we have to have solid justification for rate increases. We know we have to have annual increases of some level just to account for inflation. We also have a pressing need to build reserves. Maintenance and repair of an aging system is the third operational cost factor on which we have focused, followed by compliance issues.

Due Date Change

The change to the 30^th due date does present some challenges. The big challenge is that it concentrates more activity at the end of the month.

With the 21^st due date most of the current billing period activity is over by the 22^nd and work can start on the next billing period with the bills going out on the last day of the month or the first day of the next month. Charli is not happy about it, but she says she can deal with it.

However, I am of the opinion that the 30^th due date is better for our customers.

Billing System

The BDS Data Systems billing software is giving us problems. To make that even more of an adventure, BDS’s customer service has gone a long ways down hill.

The big problem with the software itself is that it will, at random, drop meter readings. Our calls to BDS to fix this problem resulted in their staff telling us that the readings were not entered in the first place. That is an impossibility. You can’t generate bills without current readings, even if they are zero.

When other, more minor, problems crop up, it seems that our calls to them are a big bother.

Adding insult to injury, during the last go around it was revealed that the current version of the software is Version 10. We have been using Version 6. We were never informed about Versions 7, 8, 9 or 10. For this we are paying $795 a year.

The billing system is at the center of our revenue generating efforts.

Some of the other irritations include:

• A Report Writer module that is way outside the bounds of “user friendly” and is very limited in the ability to format reports.
• An abstruse interface with Databar.
• The inability to print duplicate water bills (though with a little creativity and help from Databar we can generate a duplicate bill from Databar’s print files).
• An account history report that is difficult to read and almost impossible to interpret. When we have history questions I often build a spreadsheet so that we, and the customer, can understand the history.
• A confusing account balance methodology. At any time an account could show three different numbers for “Pay Off”, “Aging” and “Account Balance”. We have requested an explanation from BDS, and the variation seems to relate to posted and unposted transactions, but they don’t seem to fully understand why the differences themselves.
• No ability to track credit card receipts and reconcile the receipts with the Point & Pay deposits to our bank account. We do that separately.
• An overly complex account numbering system.
• We only have one “seat”. Acquiring a second seat involves purchasing, at full price, another copy of the software. Currently, if there is work I need to do in the billing system, I have to kick Charli out of her chair.
• One of the prime reasons for adopting this software was the low initial cost. I think we have gotten our money’s worth from the initial investment. But the $795/year seems like a definite waste of money.

My proposal is to switch to the Bias Software billing module that attaches to our accounting system. It fixes all of the above irritations, includes some features that would be very useful that we currently do not have, comes with the Bias support team (who are exceptional), and can be set up “hosted” rather than the District purchasing the software. It has the further advantage of interfacing with the accounting system.

Their proposal includes some substantial start up costs. But we would not use everything they are proposing. Specifically, we would not use the Cash Receipting module, and, most likely, would not request on-site set-up assistance. We did not require on-site assistance to set up the accounting system and that saved us a significant chunk of change.

Their proposal totals $4,930 if we leave out the Cash Receipting. I don’t know how much we would save by not having an on-site session. That is difficult to quantify. The set up includes basic set up plus importing our existing data into the new system. That amount also includes the first six months of “hosting” at $200/month.

We could use some variation of our current account numbers, so we would not have to go through the customer education process of new account numbers.

My big issue is customer support. While it might take a day or two to get BDS to respond (and then reluctantly), Bias has always been available to answer questions and fix problems within a few minutes of our cries for help. They have provided literally hours of assistance in getting us BARS compliant inside our monthly hosting fee.

This is a substantial unbudgeted expense, but is pretty basic to our operation.

I am requesting approval.

Water Usage

Please see the Production Summary included in your packets.

Central Park Elementary School Lead Problem

No word from anyone in July.

Maintenance Activity:

Usual daily/weekly/monthly maintenance activity. See attached report.

Maintenance activity is beginning to be a critical issue. There is no lack of energy or efficiency on Kenny’s part, but maintenance items continue to pile up, and, more disturbingly, deferred. This situation is further complicated during meter reading, as critical repair items come up during that period and meter reading must be delayed while the repair is accomplished.

Kenny achieves a sense of relief when he can get the number of open work orders below 200.

The “summer projects” routine is also falling behind. For a long time we could get the summer maintenance items completed with the help of a temporary employee. Even with the highly variable character of the summer help we were able to get the maintenance items completed during June, July and August.

In the past two years, that has not been case. In the summer of 2016 we had a pretty good temporary, but had to extend the employment period into September. In 2017 we had a truly outstanding helper (Mick Peterson) AND we extended the employment period from May to September, and quite a few of the summer tasks had to be deferred. This year we are again running the summer period from May through September.

At this point we have 14 work items for the upcoming Summer. Seven of the 13 are relatively critical. Just one of the items, hydrant maintenance, could occupy a moderately ambitious helper all summer to complete. In addition, with the isolation valve exercise program added as a Sanitary Survey item we are under pressure to develop and implement a program. While development is something of an issue, I don’t know where we will find the time to implement.

With the system continuing to age it simply takes increasing amounts of labor to stay ahead of maintenance and repair, even with the long list of issues we have addressed to date.

The point of this discussion is to draw attention to the need for additional field staff.

I am requesting a full time laborer/meter reader in the 2019 budget.

Specific Summer Projects:

• Strip and recoat North Bank Reservoir roof DEFERRED
• Paint pumphouse plumbing IN PROCESS
• Paint pumphouse steps PROBABLY DEFERRED
• Install Well #6 flush valve
• Determine status of Devonshire Road transmission line IN PROCESS
• Install sampling station at Reynaan Reservoir DONE
• Locate buried fire hydrant and water main isolation valves ONGOING
• Paint and/or repaint fire hydrants WAY BEHIND
• Install number plaques on remaining fire hydrants WAY BEHIND
• Catch up fire hydrant maintenance UNDERWAY, BUT BEHIND
• Rearrange shop site to accommodate proposed fire station retention pond
• Fix 117 Reynvaan Drive service lateral FIXED
• Clean up well site PROBABLY DEFERRED
• Continue re-organization of the shop ONGOING, MAJOR ISSUES DEFERRED

The above is in addition to the routine grounds maintenance. Lots of grass to mow.

Contractor Repairs

Joann Way, Hill Road. Both service laterals.

Highway 12 hydrant

Scott, and I, are proposing to drop pursuit of this issue. With the driver apparently having no insurance and now located in Idaho, it would cost more to pursue than recovery.

Hill Road hydrant replacement

Scott is pursuing this issue.

Hill Road Water Main

I am putting this project on hold. I just don’t see where we can squeeze out the money. It will remain in the report as a place holder.

Well Site Fence

Along with some of the other nagging maintenance chores, the well site fence needs some work. Some of the barbed wire has fallen and the gate needs a bit of welding. On hold for the moment in deference to more pressing concerns.

Highway 12 Meters

I am ready to move on this project. You have a copy of the Correct Equipment estimate.

This is a budgeted item. I am requesting approval to accept the Correct Equipment proposal.

Well #5 Source Meter

The source meter on Well #5 has been needing replacement for some time. The meter is a bit of a dinosaur. It is a propeller type meter with the propeller mounted at the end of a four-foot long shaft. The modifications to make the meter capable with the SCADA system are, let’s say, over-engineered. All the bearings are worn and the packing gland is leaking.

I suspect we are submitting dishonest Water Use Efficiency reports due to this meter.

There is a quote for a new meter in your packets, but it doesn’t include installation, which will be expensive. I hope to have that in hand by the meeting.

I will request approval if the installation estimate arrives before the meeting and it is not stratospheric.

Shop Plumbing

The shop plumbing modifications are done. We now have a functioning toilet and hot water. I am going to go in search of a used washer and dryer. That sounds like an extravagance, but with the mud soaked and gritty work clothes that Kenny has to deal with after a day in the ditch, it isn’t. A used washer is the way to go, as the embedded grit really chews up washing machines.

Shop Organization

This project has started. But we need to keep breaking off to get some higher priority work done.

Some of the re-arranging and sorting will get done. But the complete inventory of items to be surplussed will need to be deferred.

Training/Certifications.

Kenny has completed the first phase of the computer class. The second phase starts up in the fall.

I am now a WDM4.

Safety

We have a mini safety meeting every morning. This time of year we focus on hydration issues and driving safety.

The focus on safety, and safety training, has reduced our accident rate to zero for many months now. Call that years. I intend to keep it that way.

Vehicles

Service Truck: No issues.

F-150: No issues.

S-10: No issues.

Pickup Truck: No Issues

New Connections

No new connections in July.

Old Shop Building Gutters & Downspouts

No action in July. I need to move this item up on the priority list before the winter rains set in.

Shop Site South Fence

On hold until we see all that the fire station fencing will entail.

Alder Glen & Etc.

No news in July. This project is deferred.

Carl Way/Ridgeview: Not an issue

Hemlock Park

Lois Lane Not an issue

Waverly Court Not an issue

Garden Road: Not an issue

Walthom Lane: Not an issue

Greenbriar Court

Reynvaan Court

Madow Court

Reed Lane Not an issue

Blaine Road (End) Not an issue

Larson Lane Not an issue

Fremont Drive

Silkey Court

Lake Road

Hemlock Park

Fairway Park

River Road: Replaced

Alder Glen: Will need replacement.

Fairway Terrace: Will need replacement.

Filing System

No action in July.

Renters

No action in June. As a reminder regarding this item…it is my intent to have two forms. One form that is completed by the tenant at the time they apply to have the billing in their name, and a second form that will be sent to the property owner informing them that the tenant is vacating. My thinking on the second form is that it will include a forwarding address for the tenant and will require acknowledgement by the property owner before the tenant’s deposit will be sent to the forwarding address.

While our policy of requiring a deposit for tenants is a service to the property owner, the primary objective is to remove the District from tenant/owner conflict. We are not a collection agency and have not intention of becoming one.

Armory

This project is now on the front burner. I expect to see revised plans in the next couple of weeks. They are definitely requesting domestic service along with fire flow.

We (I) waived the requirement for separate meters for each building for this project. Because it is a secure facility, and meters will have to be located outside the fence, the requirement would have resulted in separate service laterals out to Clemons Road for each building, further complicated by a Federal requirement to keep the well and associated equipment available in a standby condition. It just didn’t make sense to run service laterals all over the site.

Besides, the requirement for separate meters for each building is to reduce the arguments among tenants as to who owes what. Not an issue with the Armory.

WASWD Fall Conference

I have made the reservations for my attendance. This is shaping up to be an excellent conference.

I need to get a signature on the voting letter from Joe. A copy of the letter is in your packets.

I am adding some time off at each end. I plan to leave early for the conference and visit the NWS corporate headquarters (now located in Colfax), and proceed to Helena, Montana after the conference to visit my cousin. So I plan to be out of the office from Monday, September 17^th and back in the office Tuesday, September 25^th. Which may extend into Wednesday if I find I can no longer drive 12 hours straight.

LeMay Project

I will be attending the every-other-week construction meeting. I happened to visit the site during one of those meetings, which proved fortuitous. So it was agreed to include me in subsequent meetings.

There is a consultant retained for the SCADA aspect of the project, and they have been instructed to contact the water district. So far they have not done so. But the ball is in their court.

Fire Station

There is an issue with the access road. I thought that Berglund-Schmidt and I had hammered out a solution, but apparently not. The fire chief and I need to meet to work it out. That should happen some time before the meeting.

Big Ridge Lodge

I have heard nothing about this project in July.

Reynvaan Site Security

Lighting and fencing have not been ordered. I am putting this one on hold. We haven’t experienced any problems, and we have bigger fish to fry.

As-Built Drawings

I am leaning towards handling this in-house with some limited assistance from consultants. But I have made no final decision yet, nor have I taken any action.

Disaster Management Planning

No action on the plan outline in July.

I really need to bear down on this. We are in pretty good shape for typical emergencies, but there are still holes in our ability to respond to a real catastrophe.

One item I want to investigate is the possibility of developing an intertie with the City of Aberdeen at Lake Aberdeen. That would provide us with a source of non-potable water in the event of an extreme event (earthquake/tsunami) that might render our wells inoperable. The water would have to be filtered and boiled in order to be “potable”, but residents could use it for toilet flushing and other, non-potable, sanitary uses. Coffee filters work for filtration and the water could be boiled for drinking and cooking.

No action in July

WAWARN

Nothing of immediate interest.

Red Flag Programs

We don’t have a plan. But we have run into a problem. When payments are being received over the phone we have to be on speaker phone so we have both hands free, and we have to read back the information.

The problem occurs when another customer is at the counter. They can hear all the information they need to steal someone’s credit card information.

Currently, all we can do is ask the person on the phone to hold until we take care of the customer at the counter and get them out the door.

This issue will probably force me to work on developing a formal plan.

No action in July.

Isolation Valve Exercise Program

This is another Sanitary Survey item. It has been on my to-do list since 2012.

I have made some progress in crafting a program. That is the easy part. My time is still being eaten up correcting data on fire hydrants. Once that is complete I will start collecting the data for this program.

By utilizing Google Maps I can move this project forward independent of as-built drawing project.

Establishing schedules and work order generation will occur along side of data collection.

Future and/or On-Hold Programs

Web Page

Email Bills

Unfunded “Dream” Projects

Include Reynvaan Pump Station in SCADA

Probably will require new controls, which are getting due anyway

Include Hirschbeck Pump Station in SCADA

Convert SCADA Communications to Cellular, or whatever

Repave Office Parking Lot (Over Jim’s dead body) THE WORST SPOTS ARE PATCHED.

Replace Office Carpet

Long Distance Service Laterals

Any thoughts would be welcome.

Respectfully Submitted:

Reg Hearn

General Manager