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Home My WebLink AboutEDB Master Metering Recommendation Final EXECUTIVE SUMMARY AGENDA ITEM: Recommendation of master metering of the Black Creek Multi-Family Project requested by ETM and Denton Floyd Real Estate Group Date: September 2, 2022 BACKGROUND: At the last Board of Supervisors meeting, our staff presented a request from ETM and Denton Floyd Real Estate Group to master meter their Black Creek Multi-Family Project. The representative from Denton Floyd Real Estate Group presented their plan to master meter their project at the property line and then submeter each apartment unit. Our staff denied the request to master meter their project because the existing Service Availability Policy only allows master metering for workforce housing. Based upon further review and evaluation, we are recommending the Board of Supervisors approve the master cts metering of the Black Creek Multi-Family Project with a term of service within the Developer Agreement a allowing CCUA to reclassify their project from Commercial to either Commercial Multi-Family or ca Residential Multi-Family at some point in the future. 0 c 5 CCUA's restriction on the use of master meters begins in Section 32 (page 49, last paragraph) of the Service Availability Policy. The last paragraph of this section references CCUA Water Conservation Plan re that was on file with the St. Johns River Water Management District (SJRWMD). At the time, CCUA's Consumptive Use Permit (CUP) with the SJRWMD had a condition restricting the use of master meters. This paragraph in Section 32 no longer applies for a couple of different reasons. First, the SJRWMD removed the condition restricting the use of master meters in a modification to the CUP dated October 15, 2021. Second, we updated CCUA's Water Conservation Plan in coordination with the SJRWMD in preparation for an early CUP renewal in accordance with the Black Creek Water Resource Development Project Financial Participation Agreement.The updated Water Conservation Plan does not have the master meter restriction. Section 36 of CCUA's Service Availability Policy related to Workforce Housing Developments also bases the ability to authorize master meters upon what is permitted by CCUA's CUP. As previously noted, CCUA's current CUP does not have a restriction on master metering. A point was raised at the last Board of Supervisors meeting regarding CCUA's permitting of other multi- family projects with a single master meter serving the project. CCUA has permitted two different multi- family projects with master meters. In one instance, the project had technical considerations due to the height of the buildings which made individual service lines to the upper floors unfeasible. A second development was permitted to use a master meter after receiving a conditional exemption from the SJRWMD. The developer's engineer and CCUA staff worked with the SJRWMD staff to ensure we were //JDJ(Author) //PS,MB,DD,GW(Review) //JDJ(Final) Executive Summary Black Creek Multi-Family Master Meter Page 1 remaining compliant with CCUA's CUP by sub-metering. Any other multi-family development using a using a master meter has been designated income restricted/workforce housing. In these cases, CCUA's responsibility in serving these projects ends at the master meter on the property line. The property owner remains the responsible legal entity for the on-site utility system. Our staff brought up an issue with the revenue associated with a single master meter versus numerous individual meters. This point is correct from a revenue perspective in CCUA's existing rate structure. However, CCUA will not have numerous individual meters to maintain along with valves, pipes, manholes, etc., CCUA costs to deliver services to these projects will be slightly lower. We are currently working through specifics on this issue with our Rate Study consultants, CDM Smith. CDM Smith pointed out an issue with CCUA's rate structure and increasing meter sizes during the April 2022 workshop. CDM Smith rightly pointed out that CCUA's rate structure has the cost per gallon decreasing with meter size increases. They also pointed out they could not determine an apparent cost of service justification for this issue. Based upon the Board of Supervisors feedback in the Rate Study workshop, CDM Smith and CCUA staff are working through this issue. Staff initiated an evaluation of several other utility rate structures as they pertain to multi-family properties. Generally speaking,most utilities have a Residential Multifamily customer class. Whether the Residential Multi-Family class property has a flat-water rate for delivery, or a calculated tiered rate structure depends on the utility. We have attached a table of the information related to serving multi- family properties from the utilities we surveyed. Given the growth planned for Clay County and the pressure for rental housing, staff considers updating the Service Availability Policy to be consistent with CCUA's current CUP permit and market trends an important effort. The Rate Study has been underway for some time, and we will provide the Board of Supervisors recommendations out of that effort. Staff is also beginning the annual update to the Service Availability Policy for inclusion in the upcoming Rate Resolutions that will be considered by the Board of Supervisors at the first meeting in October. Staff wants to begin incorporating updates to the Service Availability Policy as soon as reasonably practical. RECOMMENDATION: Staff recommends approving the Black Creek Multi-Family project with a master meter and submeters as proposed by Denton Floyd Real Estate Group and ETM. Staff requests this approval include terms in the Developer Agreement that reserves the rights stated below. • CCUA reserves the right, at its sole discretion, to revise the customer class of the Black Creek Multi-Family property from Commercial to either a Commercial Multi-Family or Residential Multi-Family designation. CCUA revision in customer class in this agreement will be based upon an update to the utility's Service Availability Policy and Rate Resolution as considered and approved by the Board of Supervisors. • The Developer must submit for the Authority's approval a water conservation plan demonstrating a protective approach to monitoring and maintaining the subject property's utility system to conserve water resources being provided on a master metered basis. //JDJ(Author) //PS,MB,DD,GW(Review) //JDJ(Final) Executive Summary Black Creek Multi-Family Master Meter Page 2 • The Developer shall provide either a letter of credit or other financial deposit, calculated by the Authority in such amount as to be protective of the credit risk to the Authority being incurred by providing such utility services to the Developer or the Developer's successor and/or assigns for the property. The letter of credit or financial deposit would be the calculated total of the number of units multiplied by CCUA's residential unit deposit rate for water and wastewater services in the then current fiscal year. • The Developer acknowledges in the agreement that the Developer or the Developer's successors and/or assigns shall not be entitled to the benefits of Section 3, Subsections (18) and (19) of the Rate Resolution regarding individual (non-master metered) customer adjustments, and may not participate in CCUA's water leak credit program, nor in any other similar program designed to help individually metered services not bear the full impact of a previously undetected leak or meter reading error attributable specifically to that individually metered service, for any such master metered service connections. • The Developer acknowledges in the agreement that the Developer or the Developer's successors and/or assigns shall not upcharge water and wastewater services to residents of the development. Attachments: Table comparing other utilities in Florida //JDJ(Author) //PS,MB,DD,GW(Review) //JDJ(Final) Executive Summary Black Creek Multi-Family Master Meter Page 3 St.John's Toho County Water Hillsborough CCUA Utilities JEA GRU Authority County Comments Toho moved back to Allow Master Metering? Yes Yes Yes No Longer Yes individual meters Require Submetering? Yes Optional Yes Optional Optional No Tiered or Flat Rate? Tiered Tiered Flat Flat Tiered Tiered Master Planning Provisions? Yes Yes Yes Yes Yes Restrict Upcharging? Yes No Yes Yes(10%max.) Yes No Cap-Flat No Cap-Flat Sewer charges capped or tiered? Capped Rate Rate No Cap No Cap to //JDJ(Author) //PS,MB,DD,GW(Review) //JDJ(Final) Executive Summary Black Creek Multi-Family Master Meter Page 4