City of Williams to replace aging water meters using $1.5 million of its Water Infrastructure Finance Authority loan
WILLIAMS, Ariz. - Williams residents haven't been paying for all of the water they're using, but city staff is getting ready to change that.
In order to start collecting revenue that the city is losing because of old and inaccurate water meters, staff is taking the first step in starting a meter replacement program.
The Williams City Council unanimously approved a Request for Proposals (RFP) for the water meter replacement program at its Oct. 23 meeting. The city will evaluate the proposals in January 2015 and work on the project could possibly start in early spring of 2015.
The city is pursuing the project because as water meters age, they gradually start to under-register the amount of water customers use, meaning residents are paying for less water than they are actually using.
In a staff report to the mayor and council, City Manager Brandon Buchanan estimated that the city is not billing for about 40 percent of the water it is producing, which translates to about $380,000 in lost revenue annually.
Buchanan expects that once the new meters are installed, the city will recoup less than that amount because some customers will decrease their usage instead of paying for the full amount of water they had been using.
"Regardless, this project will generate new revenues that will have several positive outcomes," Buchanan wrote in his staff report. "It will create revenue necessary to help repay the WIFA (Water Infrastructure Finance Authority of Arizona) loan, create a pool of money to begin reinvestment in necessary water infrastructure, and/or reduce the burden of the water fund on the electric fund (allowing the City to use that funding to instead reinvest in electric infrastructure)."
The water meter replacement program is one of the projects that the city will pay for using its $3.5 million WIFA loan. About $1.5 million of the loan amount was allotted for this project. Since it is a green project, the water meter replacement program allowed for $1.5 million of the loan amount to be eligible for forgivable principal.
City officials estimate that the cost to replace about 1,500 water meters will be $247,000. The remainder of the cost will come from updating the reading system and modernizing the installation.
The city hopes to switch to a water meter called the Sensus iPERL. City officials chose this kind of meter because they have installed a limited number of them in the past few years to replace broken meters. The Sensus iPERL meters are more reliable because they function differently than most of the existing meters.
"Some of the meters have the oscillating disks or different mechanisms to measure the flow," Buchanan said. "This one actually has no moving parts inside that measures the flow. So that's several less things to break in these meters."
Besides their increased accuracy, the Sensus iPERL meters would also streamline the meter reading process.
"It would all be read by a single tower basically, a single receiver, and it would all be read at the push of a button here at the city office," Buchanan said. "So it does obviously add some efficiency to our system so we don't have a meter reader driving around all the time."
Depending on the signal strengths from the tower to the various meter locations throughout town, the city could require about three towers.
Councilman Lee Payne asked if city staff had developed a meter replacement plan so the city doesn't have to go through a similar system-wide replacement process again in 20 years when the new meters have reached their life expectancy. Buchanan said developing a plan was a good idea.
"We need to, as the budget allows, start putting money aside so in 20 years we write the check for $1.5 million or whatever the number is at that point instead of having to borrow money to write the check," Buchanan said.
Payne added that the city might have to look for other ways to save for a water meter replacement program as well.
"Nobody likes to hear it but maybe we need to tack something on to put in a pot so that we do have that in the future where we don't have to come up with this," he said.
Other communities save for this type of capital replacement project through meter fees or by building a charge into the monthly fee, Buchanan said.
After the council members made some recommendations about the language in the RFP, they unanimously approved the document. Once the city evaluates the proposals, the council will have to approve the final contract with the company who will complete the work.