CC - Minutes - City Council - 4/1/2008 (3)

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Prescott City Council Workshop —April 1, 2008 2 those fees are but he lacked the data Mr. Jackson said he would continue to work at getting that information. Councilman Roecker referred to page 26 and said if the City charges $4700 per apartment unit they will never see another apartment built. He suggested the scenario where somebody wants to build a ten-unit apartment complex with one water meter. Mr. McConnell said the City of Prescott has to serve new development, residential and commercial, with alternate water. He said the City cannot just drill another well and pump groundwater. Mr McConnell explained they have an existing portfolio, which has resources in it; they have the Big Chino Project, which contemplates bringing in additional water. Both the portfolio water and the Big Chino water have a cost and a value to them so that when the City provides or allocates water to do development it has costs associated with it. Mr. McConnell said they allocate the water on the basis of equivalent residential units and as a policy issue they can charge for that water either on the per unit basis or charge on the meter side Councilman Roecker said they are talking about the impact fee per unit and that does not seem right City Manager Steve Norwood asked if there is a conservation element to that as well. Mr. McConnell said there was and that statistically a family will use 15% more water if it is coming through a master meter than if it comes through an individual meter because they never see how much water they are using through a master meter. Mr. McConnell said there are a number of variables and policy issues related to the question of how they allocate water, how they value our alternate water and the implementation of things like conservation through a rate structure. He said it is a balancing act from a policy standpoint by the Council and what the Council as a whole feels is the most equitable would be in fact how they set their policy. Mayor Pro Tern Suttles asked Mr. Jackson about page 25 regarding non- residential businesses such as schools, colleges and restaurants She said this is a pretty big jump for these businesses, more than doubling the rates for schools and colleges and asked if there is any way to ease into it. Mr Jackson said the one alternative would be to phase in the non-residential rate structure but that would require some sort of continued subsidy for awhile. He said one of the reasons schools would be paying so much more is because they are currently paying $101 for 70,000 gallons of service. That is significantly less than what it is costing the City to provide that service to them. Mr. Jackson said that one reason the jump is so much is to bring them up to parody with what the cost is. He said that one alternative is to phase it in over 2-3 years, which would ease the impact on the rate payer but also require the City to continue selling the service to them over the next couple of years at essentially below cost rate. Mr. Jackson said it is a policy decision; it's an art not a science. Mayor Pro Tern Suttles said the City of Prescott makes its living on sales tax and they want to be business friendly. She said she feels they would be chasing