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HomeMy WebLinkAbout2023-04-18 - Agendas - FinalCity of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 City Council Final Agenda Tuesday, April 18, 2023 5:30 PM City Hall Room 219 City Council Members Council Member Sonia Harvey Ward 1 Council Member D'Andre Jones Ward 1 Council Member Sarah Moore Ward 2 Council Member Mike Wiederkehr Ward 2 Council Member Scott Berna Ward 3 Council Member Sarah Bunch Ward 3 Council Member Teresa Turk Ward 4 Council Member Holly Hertzberg Ward 4 Mayor Lioneld Jordan City Attorney Kit Williams City Clerk Treasurer Kara Paxton Page 1 of 425 City Council Meeting Final Agenda April 18, 2023 ZOOM INFORMATION: 1. WEBINAR: 894 9361 5182 PUBLIC REGISTRATION LINK: HTTPS://US06WEB.ZOOM.US/WEBINAR/REGISTER/ WN Y4Y8LHU4R3-UORVHNYM9VG (2023-609) CALL TO ORDER ROLL CALL PLEDGE OF ALLEGIANCE MAYOR'S ANNOUNCEMENTS, PROCLAMATIONS AND RECOGNITIONS CITY COUNCIL MEETING PRESENTATIONS, REPORTS AND DISCUSSION ITEMS PROPOSED AGENDA ADDITIONS A. CONSENT A.1. APPROVAL OF THE APRIL 4, 2023 CITY COUNCIL MEETING MINUTES: (2023-494) A.2. ACCEPT FUNDING FROM HIDTA AND BUDGET ADJUSTMENT: A RESOLUTION TO APPROVE A MEMORANDUM OF AGREEMENT WITH WASHINGTON COUNTY TO ACCEPT FUNDING FROM THE GULF COAST HIGH INTENSITY DRUG TRAFFICKING AREA IN THE AMOUNT OF $98,066.00 FOR THE POLICE DEPARTMENT, AND TO APPROVE A BUDGET ADJUSTMENT (2023-578) A.3. PURCHASING OF BUNKER COATS AND PANTS FOR THE FIRE DEPARTMENT: A RESOLUTION TO AUTHORIZE THE PURCHASE OF BUNKER GEAR COATS AND PANTS FROM LION MANUFACTURING THROUGH NAFECO, INC., PURSUANT TO A SOURCEWELL COOPERATIVE PURCHASING CONTRACT, IN THE AMOUNT OF $154,439.10 PLUS APPLICABLE TAXES AND FREIGHT CHARGES (2023-605) A.4. INTEREST BUDGET ADJUSTMENT TO 2019 PHASE I BONDS: A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF $463,032.00 RECOGNIZING INTEREST REVENUE GENERATED FROM THE SALES & USE TAX CAPITAL IMPROVEMENT AND REFUNDING BONDS City of'Fayetteville, Arkansas page 2 Page 2 of 425 City Council Meeting Final Agenda April 18, 2023 SERIES 2019 (2023-626) A.S. AMEND RESOLUTION 35-23 AND APPROVE A BUDGET ADJUSTMENT: A RESOLUTION TO AMEND RESOLUTION 35-23 BY REDUCING THE AMOUNT OF REAPPROPRIATIONS TO THE 2023 BUDGET BY $3,031,724.00, AND TO APPROVE A BUDGET ADJUSTMENT (2023-627) A.6. WEST SIDE PRAIRIE HABITAT RESTORATION AND MANAGEMENT: A RESOLUTION TO AUTHORIZE A ONE YEAR CONTRACT WITH THE NORTHWEST ARKANSAS LAND TRUST IN THE AMOUNT OF $20,000.00 FOR HABITAT RESTORATION AND MANAGEMENT AT THE WEST SIDE PRAIRIE WITH AN OPTION TO RENEW FOR FIVE ADDITIONAL ONE YEAR TERMS (2023-648) A.7. PARK IMPACT FEE STUDY: A RESOLUTION TO EXPRESS THE INTENT OF THE CITY COUNCIL TO ENGAGE A CONSULTANT TO PERFORM A PARK IMPACT FEE STUDY (2023-650) B. UNFINISHED BUSINESS B.1. RZN 23-004: (2910 N. OLD WIRE RD. / VAN SCYOC, 255): AN ORDINANCE TO REZONE THAT PROPERTY DESCRIBED IN REZONING PETITION RZN 23-004 LOCATED AT 2910 NORTH OLD WIRE ROAD IN WARD 3 FOR APPROXIMATELY 14.70 ACRES FROM RSF-4, RESIDENTIAL SINGLE-FAMILY, 4 UNITS PER ACRE AND R-A, RESIDENTIAL AGRICULTURE TO R-A, RESIDENTIAL AGRICULTURE AND NC, NEIGHBORHOOD CONSERVATION (2023-502) AT THE MARCH 21, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE FIRST READING. AT THE APRIL 4, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE SECOND READING. B.2. AMEND 130.39 GRAFFITI: AN ORDINANCE TO AMEND §130.39 GRAFFITI IN THE FAYETTEVILLE CODE TO CREATE A GRAFFITI ABATEMENT PROGRAM (2022-279) AT THE DECEMBER 6, 2022 CITY COUNCIL MEETING, THIS ORDINANCE WAS AMENDED TO ADD EXHIBIT A AND OMIT LEASEHOLD TENANT. THIS ORDINANCE WAS LEFT ON THE SECOND READING AND TABLED TO THE JANUARY 3, 2023 CITY COUNCIL MEETING. City of'Fayetteville, Arkansas page 3 Page 3 of 425 City Council Meeting Final Agenda April 18, 2023 AT THE JANUARY 3, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE SECOND READING AND TABLED TO THE FEBRUARY 7, 2023 CITY COUNCIL MEETING. AT THE FEBRUARY 7, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS TABLED TO THE FEBRUARY 21, 2023 CITY COUNCIL MEETING. AT THE FEBRUARY 21, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE THIRD READING AND TABLED TO THE APRIL 18, 2023 CITY COUNCIL MEETING. B.3. AN ORDINANCE TO AMEND §51.136 MONTHLY WATER RATES AND §51.137 MONTHLY SEWER RATES: AN ORDINANCE TO AMEND §51.136 MONTHLY WATER RATES AND §51.137 MONTHLY SEWER RATES TO CHANGE WATER AND SEWER RATES AS RECOMMENDED BY THE COST OF SERVICE STUDY CONDUCTED BY BLACK & VEATCH (2022-319) AT THE JUNE 21, 2022 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE FIRST READING AND TABLED TO THE JULY 19, 2022 CITY COUNCIL MEETING. AT THE JULY 19, 2022 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE FIRST READING AND TABLED TO THE DECEMBER 6, 2022 CITY COUNCIL MEETING. AT THE DECEMBER 6, 2022 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE SECOND READING AND TABLED TO THE MARCH 7, 2023 CITY COUNCIL MEETING. AT THE MARCH 7, 2023 CITY COUNCIL MEETING, THIS ORDINANCE WAS LEFT ON THE SECOND READING AND TABLED TO THE APRIL 18, 2023 CITY COUNCIL MEETING. B.4. ARPA SUBRECIPIENT APPLICATION - SERVE NWA D/B/A NEW BEGINNINGS: A RESOLUTION TO APPROVE AND AUTHORIZE MAYOR JORDAN TO SIGN AN ARPA FUNDED SUBRECIPIENT AGREEMENT WITH SERVE NWA FOR SUPPORTIVE OR AFFORDABLE HOUSING IN THE AMOUNT OF $1,295,000.00 AND TO APPROVE A BUDGET ADJUSTMENT (2023-505) AT THE MARCH 7, 2023 CITY COUNCIL MEETING, THIS RESOLUTION WAS TABLED TO THE APRIL 18, 2023 CITY COUNCIL MEETING. C. NEW BUSINESS City of'Fayetteville, Arkansas page 4 Page 4 of 425 City Council Meeting Final Agenda April 18, 2023 C.1. APPEAL CUP-2023-008: CONDITIONAL USE PERMIT (348 N. FLETCHER AVE./SCOTT, 485): A RESOLUTION TO GRANT THE APPEAL OF COUNCIL MEMBERS SCOTT BERNA, SONIA HARVEY, AND D'ANDRE JONES AND APPROVE CONDITIONAL USE PERMIT CUP 2023-008 FOR A SHORT-TERM RENTAL AT 348 NORTH FLETCHER STREET (2023-546) C.2. APPEAL CUP-2023-009: CONDITIONAL USE PERMIT (332 N. FLETCHER AVEJETG SHELF 3 LLC, 485): A RESOLUTION TO GRANT THE APPEAL OF COUNCIL MEMBERS SCOTT BERNA, HOLLY HERTZBERG, AND D'ANDRE JONES AND APPROVE CONDITIONAL USE PERMIT CUP 2023-009 FOR A SHORT-TERM RENTAL AT 332 NORTH FLETCHER STREET (2023-549) C.3. WALKER PARK BASKETBALL COURT REFURBISHING AND GIVEAWAY: A RESOLUTION TO APPROVE A PROPOSAL BY WALMART AND AND1 TO REFURBISH AND PAINT THE WALKER PARK BASKETBALL COURTS AND HOST A BACK TO SCHOOL BACKPACK AND SHOE GIVEAWAY, AND TO APPROVE THE RECOGNITION OF WALMART AND AND1 FOR THEIR SIGNIFICANT CONTRIBUTIONS AT THE REFURBISHED COURTS (2023-651) D. CITY COUNCIL AGENDA SESSION PRESENTATIONS D.1. PARKS, NATURAL RESOURCES AND CULTURAL AFFAIRS ANNUAL REPORT - ALISON JUMPER (2023-498) E. CITY COUNCIL TOUR F. ANNOUNCEMENTS G. ADJOURNMENT Z16111I:N40t0l►yi14►yi1 34:Z+'Kela9:14IF_111Q14►IN4 All interested persons may appear and address the City Council on Unfinished Business, New Business, and Public Hearings at City Council meetings. If you wish to address the City Council on an agenda item, please wait for the Mayor or Chair to request public comment. When the Mayor or Chair recognizes you, please start your public comment by giving your name and address. Comments are to be addressed to the Mayor or Chair. The Mayor or Chair will direct your comments to the appropriate elected officials, staff, or others for response. Keep your comments respectful, brief, to the point, and relevant to the agenda item being considered. Each speaker from the public will be allowed one turn to speak for discussion of an agenda item. Below is a portion of the Rules of Order and Procedure of the Fayetteville City Council City of Fayetteville, Arkansas page 5 Page 5 of 425 City Council Meeting Final Agenda April 18, 2023 pertaining to City Council meetings: Agenda Additions: A new item which is requested to be added to the agenda at a City Council meeting should only be considered if it requires immediate City Council consideration and if the normal agenda setting process is not practical. The City Council may only place such new item on the City Council meeting's agenda by suspending the rules by two-thirds vote. Such agenda addition shall be heard prior to the Consent Agenda. Consent Agenda: Consent Agenda items shall be read by the Mayor and voted upon as a group without discussion by the City Council. If a Council Member wishes to comment upon or discuss a Consent Agenda item that item shall be removed and considered immediately after the Consent Agenda has been voted upon. Unfinished Business and New Business: Overview Period: Agenda items at a City Council meeting shall be introduced by the Mayor and, if an ordinance, read by the City Attorney. City staff shall then present a report. An agenda applicant (city contractor, rezoning or development applicant, etc.) may present its proposal only during this presentation period, but may be recalled by a Council Member later to answer questions. City staff, Council Members and applicants may use electronic visual aids in the City Council meeting as part of the presentation of the agenda item. City staffs presentation and an Applicant's presentation whether presented by one or more than one presenter shall each be limited to a maximum of ten (10) minutes unless the City Council by unanimous consent or majority vote allows additional time. Public Comments: Public comment at a City Council meeting shall be allowed for all members of the audience who have signed up prior to the beginning of the agenda item they wish to address being opened for public comment. Speakers shall be limited to a maximum of five (5) minutes to discuss the agenda item being considered by the City Council. Amendments may receive public comments only if approved by the City Council by unanimous consent or majority vote. If public comment is allowed for an amendment, speakers will only be allowed to speak for three (3) minutes. The City Council may allow both a speaker additional time and an unsigned -up person to speak by unanimous consent or majority vote. As part of a person's public comments allowed above, the speaker may use electronic visual aids during their five (5) minutes presentation period concerning the agenda item being considered by the City Council. Courtesy and Respect: All members of the public, all city staff and elected officials shall accord the utmost courtesy and respect to each other at all times. All shall refrain from comments that are harassing or amount to a personal attack against any identifiable individual including abusive comments and derogatory remarks about integrity or offer any other comments that are also not limited to the discussion of the specific agenda item being considered by the City Council. Any member of the public who violates these standards shall be ruled out of order by the Mayor, must immediately cease speaking and shall leave the podium. Interpreters or Telecommunications Devise for the Deaf (TDD), for hearing impaired are available for all City Council meetings, a 72-hour advance notice is required. For further information or to request an interpreter, please call 479-575-8330. A copy of the complete City Council agenda is available on our website at www.fayetteville- ar.gov or in the Office of the City Clerk, 113 W. Mountain, Fayetteville, Arkansas (479) 575- 8323. City of Fayetteville, Arkansas page 6 Page 6 of 425 City Council Meeting Final Agenda April 18, 2023 All cell phones must be silenced and may not be used within the City Council Chambers. City of Fayetteville, Arkansas page 7 Page 7 of 425 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: CITY COUNCIL MEMO 2023-578 FROM: Mike Reynolds, Police Chief DATE: SUBJECT: Approval of MOU and Budget Adjustment for Federal Funding from Gulf Coast High Intensity Drug Trafficking Area RECOMMENDATION: Staff recommends approval of a memorandum of understanding with Washington County, Arkansas to accept funding from the Gulf Coast High Intensity Drug Trafficking Area (HIDTA) and approval of a budget adjustment in the amount of $98,066. BACKGROUND: The Gulf Coast HIDTA provides funding from the Office of National Drug Control Policy to multi -jurisdictional drug enforcement initiatives throughout Arkansas, Louisiana, Mississippi, Alabama, and Tennessee. Since 2011, the Fayetteville Police Department has partnered with the Washington County Sheriff's Office, Springdale Police Department, Prairie Grove Police Department and the local Drug Enforcement Administration office to create the Western Arkansas Mobile Deployment Team (WAMDT) initiative with Washington County being the fiduciary agency. DISCUSSION: WAMDT's mission is to infiltrate and disrupt drug trafficking organizations (DTOs) at the street level. The Gulf Coast HIDTA funds overtime for investigator activity, covert buy money for the purchase of evidence/purchase of information (PEPI), and vehicle allowances. The Gulf Coast HIDTA has approved 2023 funding for the Fayetteville Police Department in the amount of $98,066. This amount represents overtime funding for four (4) investigators at $9,747.75 each including benefits, PEPI in the amount $50,675, and vehicle allowance in the amount of $8,400. This funding has a two-year life span and must be spent by December 31, 2024. HIDTA funds are authorized for drug enforcement activity only, and HIDTA funds must supplement existing drug enforcement expenses. WAMDT is currently preparing their 2024 funding request to the Gulf Coast HIDTA; however, future allocations are contingent upon congressional approval. BUDGET/STAFF IMPACT: A budget adjustment will equally increase revenue and expense budgets in the amount of $98,066 for this non - matching federal funding to reimburse existing DTF investigators overtime, covert funds, and vehicle allowances. This budget adjustment has no impact on staffing levels. ATTACHMENTS: 2023-578 SRF - GCHIDTA 2023, 2023-578 BA - GCHIDTA 2023, MOU - Washington County Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 8 of 425 Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 9 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-578 Approval of MOU and Budget Adjustment for Federal Funding from Gulf Coast High Intensity Drug Trafficking Area A RESOLUTION TO APPROVE A MEMORANDUM OF AGREEMENT WITH WASHINGTON COUNTY TO ACCEPT FUNDING FROM THE GULF COAST HIGH INTENSITY DRUG TRAFFICKING AREA IN THE AMOUNT OF $98,066.00 FOR THE POLICE DEPARTMENT, AND TO APPROVE A BUDGET ADJUSTMENT BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan to sign a Memorandum of Agreement with Washington County to receive funding from the Gulf Coast High Intensity Drug Trafficking Area in the amount of $98,066.00 for investigator activity, purchase of evidence and information, and vehicle allowances for the Police Department. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment, a copy of which is attached to this Resolution. Page 1 Page 10 of 425 Mike Reynolds Submitted By City of Fayetteville Staff Review Form 2023-578 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 3/21/2023 POLICE (200) Submitted Date Division / Department Action Recommendation: Staff recommends approval of a memorandum of understanding with Washington County, Arkansas to accept funding from the Gulf Coast High Intensity Drug Trafficking Area (HIDTA) and approval of a budget adjustment in the amount of $98,066. 2930.200.2960-4309.01 Account Number 38070.2302 Project Number Budgeted Item? No Does item have a direct cost? No Is a Budget Adjustment attached? Yes Purchase Order Number: Change Order Number: Original Contract Number: Comments: Budget Impact: Drug Law Enforcement Grant Fund Police High Intensity Drug Trafficking Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget Project Title $ 98,066.00 98,066.00 Previous Ordinance or Resolution # Approval Date: V20221130 Page 11 of 425 City of Fayetteville, Arkansas - Budget Adjustment (Agenda) Budget Year Division POLICE (200) Adjustment Number /Org2 2023 Requestor: Willie Newman BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION: Increase in budgeted revenue equal to the increase in budgeted expense for this non -matching federal funding to reimburse existing DTF investigators overtime, covert funds, and vehicle allowances. RESOLUTION/ORDINANCE COUNCIL DATE: 4/18/2023 ITEM ID#: 2023-578 Noll y Black 312712023 6:44 q1n Budget Division Date TYPE: D - (City Council) JOURNAL#: GLDATE: CHKD/POSTED: TOTAL Account Number 98,066 98,066 increase/ (Decrease) Expense Revenue Project.Sub# Project Sub.Detl AT v.2023223 Account Name 2930.200.2960-4309.01 - 98,066 38070 2302 RE Federal Grants - Operational 2930.200.2960-5120.00 2930.200.2960-5379.07 38,991 - 50,675 - 38070 38070 2302 EX 2302 EX Personnel Other - Contra Confidential DTF - HIDTA PEPI 2930.200.2960-5802.00 8,400 - 38070 2302 EX Vehicles & Equipment - base 1 of 1 Page 12 of 425 MEMORANDUM OF AGREEMENT BETWEEN WASHINGTON COUNTY, ARKANSAS AND FAYETTEVILLE POLICE, DEPARTMENT Phis Agreement between Washington County. Arkansas and Fayetteville Police Department shall bc`�in on January 1, 2023 and shall not extend beyond December 31, 2024 unless the period is extended by modification of this Agreement. WI II?RI;AS, Washington County, Arkansas has been designated the fiscal agent for the Guil'Coast I ligh Intensity Drug Trafficking Area (I IIDTA) program, all requests for payments and budget reprogramming shall pass through Washington County, Arkansas. NOW, TlIFIRI;FORI:, Washington County, Arkansas and Gull'Coast IIIDTA hereby agree to the disbursement of I IIDTA A funds in the amount ol' 98,066 .00 to the resource recipient. l aycttevillc Police Department, under the following terms and conditions: 1. I�ayettcville Policc Department agrees to follow all applicable federal, state. and local guidelines regard►ng pL►rehascs and other cxpcnditLires Under the I IIDTA A program, ►ncluding but not llmlted to. the following: OMIT Circular 87, OM Circular A-102, OMG Circular A-133, 21 CI R Part 1403, the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Fcderal Awards (2 Cl-R 200). and the Fair Labor Standards Act (ITSA). 2. l,avettcvillc Policc Department agrees to abide by and be bound by the attached budget (Appendix A) for purchases including future reprogramming requests as approved by Washington County. Arkansas and Gulf Coast IIIDTA. All reprogramming requests shall be sL►bmitted via email to the Gulf'Coast I IIDTA Director ol'Operations. Page 13 of 425 3. Requests liar payment shall be submitted on a quarterly basis to the financial office through the I IIDTA State Director oI' Operations at the following address by the 10"' day of each month following the quarterly end: Brian Chambers 1 I1DTA State Director of Operations 3730 Appling Road Bartlett, TN 38133 All n1VOiCCS Submitted Shall comply with the terms noted in Appendix 1). fhe last invoice from the Resource Recipient (I aycttcvillc Police Department) shall be received by the l iIDTA State Director ol'Operations no later than the 15"' day prior to the grant expiration date, unless the grant is extended. All reimbursement of Overtime Expenses will be submitted using the appropriate form (Appendix C) which must contain the i IIDTA Group "bask force Supervisor's signature, certifying the overtime was I11DTA related and with the I IID'I A ease dumber contained therein. 4. RCSOUi-CC Recipient (Fayetteville Police Department) agrees to complete all applicable items in Appendix 1) and return to Washington County, Arkansas along with the signed agreement. �. Washington County agrees to transfer Funds to the resource recipient after finds have been electronically transmitted by Gulf Coast l I1DTA and rcceiptcd into Washington County's Treasury I" ands. 6. Resource Recipient (l,aycttcvillc Police Department) agrees to reimburse Washington County for any invoice paid by Washington County if such is later disallowed after audit for financial review. 7. For any and all disputes ansine Out of this Agreement the parties hereto agree that Jurisdiction will lie within Washington County. Arkansas. IN WI'I'NF.SS WI IFIREOV. the parties acknowledge the Agreement as evidenced by their signatures below. .ludgc Patrick Deakins Washington County .ludgc Fayetteville Policc Department Resource Rccipicnt Page 14 of 425 H I DTA 2023 Disclosure of High Risk Status G23GC0004A I-ayettcvillc Police Department is not currently designated high risk by another Icdcral grant making agency Fayetteville Police Department Rcsoul-cc Rccipicnt AC KNOW LF.11GMENT STATE OF ARKANSAS )SS COUNTY OF On this day before the undersigned, a Notary Public, duly qualified and acting in and for the county and state aforesaid, personally appeared , satisfactorily proven to be the person whose name appears in the foregoing instrument. and stated that he/she had executed the same for the consideration. uses and purposes therein stated. In witness whercot'. I hereunto set my hand and seal on this My Commission Fxpires: day of 2023. Notary Public Page 15 of 425 APPENDIX A BUDGET Page 16 of 425 APPENDIX B Sub -award Issued 'l'o: Fayetteville Police Department federal Award Identification No. (FAIN): G23GC0004A Federal Award Datc: 03/15/2023 Pcriod of Performance: 01/01/2023-12/31/2024 Amount of Federal funds Obligated by this Award to haycttevillc Police llcpartmcnt: $98,066.00 'Dotal Amount of Federal Funds Obligated to 1'aycttcvl1lc Police Department InClLlding the Current obligation (G 18 1 G 19 f G20 f G21 + G22 f G23 ): $150,592.80 Total Amount of federal Award committed to Faycttevillc Police Department by Washington County. Arkansas as rccclvcd From Gull Coast I IID'1 A: $855,0520.66 Federal Award Project Description: This grant will support initiatives designed to implement the Strategy proposed by the laccutivc Board of the Gull'Coast I IID TA and approved by the Of7ice of National Drug Control Policy (ONDCP). Federal Awarding Agency: I:Yccutive Office ofthe President Office of National Drug Control Policy Grantee (PassThrough hrough Entity): Washington County. Arkansas Sheriff.lay Cantrell County Judge Patrick Deakins 1155 Clydesdale Drive Fayetteville. AR 72701 CFDA Name and NUmbcr: I llgh Intensity DrUg I raf flcking Areas Program-95.001 No indirect costs (as defined In CI'R 200.414 Indirect (l,&A) costs) have been Ulthorized with this grant award. All requests I'or reimbursement must be by the 10"' day of the month Iollowing the cnd of each quarter and shall be directed to: Brian Chambers I11D'TA State Director of Operations Arkansas/'Tennessee 3730 Appling Road Bartlett, TN 38133 Page 17 of 425 APPENDIX C Caculation of HIDTA Reimbursable Overtime TFO's NAME IIIDTA Overtime this period hrs TFO's Regular pay rate i FO's Overtime rate @ 1.5 $ *fill in below only if agency is claimimg fringe associated with HIDTA overtime TFO's Fringe *please note these are the only allowable fringe cost the HIDTA program will FICA reimburse Life Health Retirement Workman's Comp 0.00% Fringe % percentage $ - Overtime X Fringe % ($50.10 X13.40%) * Please note this total must match what was paid on checkstub or payroll report submitted Caculation of Overtime $ Rate X Hours with claim* *Please note only utilize this is agency is claiming fringe* 1.5 rate or regular Overtime rate + rate + fringe rate Overtime rate w/ Fringe % $ - fringe cost per hour ($50.10+$6.71) without fringe X Total HIDTA Request $ - hours ($56.81*20 hrs) Page 18 of 425 APPENDIX D A. General Terms and Conditions This award is subject to The Uniform Administrative Rcqulrcmcnts. Cost Principles, and Audit Requirements in 2 C.F.R. Part 200 (the "Part 200 Uniform Requirements"), as adopted and implemented by the Office of National Drug Control Policy (ONDCP) in 2 C.I.R. Part 3603. For this 2023 award, the Part 200 Uniform Requirements supersede, among other things, the provisions ol'28 C.F.R. Parts 66 and 70, as well as those of 2 C.F.R. Parts 215, 220, 225, and 230. For more information on the Part 200 Uniform Requirements, see littps://cfo.gov/cofir/. For specific. award -related questions, recipients should contact ONDCP promptly for clarification. 2. Phis award is subject to the following additional regulations and requirements: a. 28 CFR Part 69-"New Restrictions on Lobbying- b. 2 CFR Part 25-"1Jniversal Identifier and System of Award Management" c. Conflict of Interest and Mandatory Disclosure Requirements, set out in paragraph 7 of these terms and conditions d. Non-profit Certifications (when applicable) 3. Audits conducted pursuant to 2 CFR fart 200. Subpart F. "Audit Requirements" must be submitted no later than 9 months alter the Close of the grantee's audited fiscal year to the federal Audit Clearinghouse at https://Iiaryester.census.gnv-/facweb/. 4. The recipient gives ONDCP or the Government Accountability Office, through any authorized representative, access to, and the right to examine, all paper or electronic records related to the grant. 5. Recipients off IIDTA funds are not agents of ONDCP. Accordingly, the grantee, its fiscal agent(s). employees. contractors, as well as state, local and federal participants, either on a collective basis or on a personal level. shall not hold themselves out as being part of', or representing. the k'sccutivc Office of, the President or ONDCP. 6. "These general terms and conditions as well as archives of previous versions of the general terms and conditions arc available online at www.wilitehouse.gov/ondcp/grants . 7. Conflict of Interest and Mandatory Disclosures a. Conflict of Interest Requirements As a non -Federal entity, you must follow ONIXT's conflict of interest policies for Federal awards. Recipients must disclose in writing any potential conflict of interest to an ONUCP Program Officer; recipients that arc pass -through entities must require disclosure from sub - recipients or contractors. This disclosure must take place immediately whether you arc an applicant or have an active ONDCP award. Page 19 of 425 The ONDC11 conflict ol'interest policies apply to sub -awards as well as contracts, and arc as follows: 1. As a non-hcdcral entity, you must maintain written standards of conduct covering conflicts ol' intcrest and �,Z�lovcrri1n�o the perlOrinancc OI your employees cngagcd nil the selection, award. and adinin1StratlOn 01' Sub -awards and contracts. ii. None 01'you1- employees may participate in the selection, award, or administration ol'a sub -award or contract supported by a federal award if' he or she has an apparent conflict oC interest. Such a conflict of intcrest would arise when the employee. olllicer, or agent, any member ol'his or her immediate Camily, his or her partner, or an organization which employs or is about to employ any ofthe parties indicated herein. has a financial or other interest in or a tangible personal benefit CrOrn an organization considered for a suh-award or contract. The olliccrs, employees, and agents ol'the non-hcdcral cntity must neither Solicit 1101, accept gratuities, favors, or anything Of Illonctary value 1rorn Sub-rcclplcntS Or contractors or parties to Sub -awards or contracts. in If wou have a parent, allliliatc, or subsidiary organization that is not a State, local govcrnnicnt, or Indian tribe. you must also maintain written standards ofconduct covering organizational conflict ol'interest. Organizational conflict ofinterest means that because 01'rclationshipS with a parent company, affiliate. or subsidiary organization. you are unable or appear to be unable to be impartial in conducting a Sub - award or procurement action involving a related organization. h. Mandatory Disclosure RCquircn1c11t As a non-FCCleral cntity, you must disclose. in a timely manner, in writing to ONDCP all violations of I:cdcral criminal law involving liaud, bribery or gratuity violations potentially affecting the hcdcral award. Non-Yedcral entities that have received a hcdcral award that includes the term and condition outlined in 200 (T R Part 200. Appendix X11 -Award 'Germ and Condition for Recipient Integrity and Performance N/latters.- arc required to report certain civil, criminal, or administrative proceedings to SAM. Failure to make rCLluircd disclosures can result in remedies such as: temporary withholding of payments pending correction of the deficiency. disallowance of all or part oCthe costs associated with noncompliance, SUS11CnSIOn. and M-11n111at1On OI award. debarment. or other legally avallahlc remedies Outlined In 2 CI'R 200.338 "Remedies for Nonconlpliancc". c. FFA l A/D,1TA- Act Compliance Flach applicant is required to 1. lie 1'ci istcrcd in the System for Award Management (SAM) bc10Pc Subllllttlll) Its application ii. Provide a valid DUNS number in its application in Continue to maintain an active SAM registration with current information at all times during which it has an active hcdcral award iv. Provide all relevant grantee information required for ONDCP to collect for reporting related to F1 ATA and DATA Act rcquircmcnts. Page 20 of 425 8. Washington County, Arkansas, as the Grantee. is required to monitor this subaward as outlined in 2 CF R 200.331. 9. Rcclpicnts must comply with the Governmcnt-wide Suspension and 1)cbarnlcnt provision set forth at 2 CFR Part 180. 10. As specified in the I IIIYI A Program Police and Budget Guidance, recipient must: a. E.stablish and maintain effective internal controls over the Federal award that provides reasonable assurance that Federal award funds arc managed in compliance with Fcdcral statutes, regulations and award terms and conditions. These internal controls Should be in compliance with the "Standards for Internal Control in the federal Goverri kilt.- issued by the Comptroller General of the United States and the "Internal Control Integrated Framework.'" issued by the Committee of Sponsoring Organizations of'the Trcadway Commission (COSO). b. Comply with federal Statutes, regulations. and the terms and conditions ofthe federal a%%ards. c. I?valuatc and monitor compliance with applicable Statutes, regulations, and the terms and conditions ol'the federal awards. d. fake prompt action when instances ol'noncompliancc are identified. including noncompliance identified in audit findings. c, lake rcasonablc measures to salcgUard protected personally identified Information (PI1) and other infonliation ONI)CP of the rcclplent designates consistent with applicable Federal. state, and local laws regarding privacy and obligations of'conlidentiality. B. Program Specific Terms and Conditions File following Special conditions arc incorporated into each award document. This giant is awarded for above program. Variation from the description of activities approved by ONUCP and/or from the budget attached to this letter must comply with the reprogramming requirements as set forth in ONDCP's IIIDTA Program Policy and Budget Guidance. 2. This award is subject to the requirements in ONDCP's I IlDTA Program Policy and Budget Guidance. 3. No I III) 1 A lLinds Shall be Used to SLlpplant State or local funds that would otherwise be made available for the Same purposes. 4. The requirements o1'28 CFR Part 23, which pertain to information collection and management of criminal intelligence systems, shall apply to any Such systems supported by this award. 5. Special accounting and control procedures must govern the use and handling off IlDTA Program Bolds Ior confidential expenditures: i.e.. the purchase of information. evidence, and services Im undercover Page 21 of 425 operations. Those procedures are described in Section 6 of the IIIDTA Program Policy and Budget Guidance. 6. Property acquired with these IIIDTA grant funds is to be used for activities ofthe GulfCoast IIIDTA, this equipment must be made available to the IIIDTA's FXCCUtIVC Board for use by other I III)'I"A participants. 7. All law enforcement entities that receive funds from this grant must report all methamphetamine laboratory sciiure data to the National Clandestine Laboratory Database/National SCIZUrc System at the 1`1 Paso Intelligence Center. C. Federal Award Performance Goals AH clltltics that receive funds Iron this award are responsible for achieving perfOrmance goals established in the I IIDTA Performance Management Process (PMP) and approved by the 1 IIDTA's I ;sccutivc Board and ONDCP. ?. All entities that receive funds from this award must report progress in achieving performance goals at ]cast quarterly using the PMP. ACCEPTANCE OF GRANT CONDITIONS Date: I"a\ cttevillc Police Department Resource Recipient Page 22 of 425 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO 2023-605 TO: Mayor Jordan and City Council THRU: Brad Hardin, Fire Chief FROM: Granville Wynn, Financial Analyst - Fire DATE: SUBJECT: Approval of a resolution to purchase bunker gear coats and pants for use by the Fayetteville Fire Department from Lion Manufacturing through NAFECO via the Sourcewell Cooperative Contract #032620-LIO through City of Fayetteville Sourcewell Number #34143 RECOMMENDATION: Approval of a resolution to purchase bunker gear coats and pants for use by the Fayetteville Fire Department from Lion Manufacturing through NAFECO via the Sourcewell Cooperative Contract #032620-LIO through City of Fayetteville Sourcewell Number #34143 . BACKGROUND: Our Department has identified Sourcewell Cooperative Purchasing from Lion Manufacturing as the most cost- effective manner to purchase bunker gear at this time. Bunker gear consists of the protective clothing worn by firefighters to shield them from heat and abrasive debris during fire suppression and emergency response activities. DISCUSSION: Purchasing through the cooperative agreement will enable us to obtain needed gear at a greatly reduced cost to the City. BUDGET/STAFF IMPACT: Existing ACT 833 funds have been allocated into the bunker gear general ledger account Project #33047.1 to allow the funding for the current purchase at a cost of $154,439.10. ATTACHMENTS: SRF_Bunker Gear Purchase —Utilizing ACT 833 funds, Vendor Quote Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 23 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-605 Approval of a resolution to purchase bunker gear coats and pants for use by the Fayetteville Fire Department from Lion Manufacturing through NAFECO via the Sourcewell Cooperative Contract #032620-LIO through City of Fayetteville Sourcewell Number #34143 A RESOLUTION TO AUTHORIZE THE PURCHASE OF BUNKER GEAR COATS AND PANTS FROM LION MANUFACTURING THROUGH NAFECO, INC., PURSUANT TO A SOURCEWELL COOPERATIVE PURCHASING CONTRACT, IN THE AMOUNT OF $154,439.10 PLUS APPLICABLE TAXES AND FREIGHT CHARGES BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes the purchase of bunker gear coats and pants from Lion Manufacturing through NAFECO, Inc., pursuant to a Sourcewell Cooperative Purchasing Agreement, in the amount of $154,439.10 plus any applicable taxes and freight charges. Page 1 Page 24 of 425 Brad Hardin Submitted By City of Fayetteville Staff Review Form 2023-605 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 3/21/2023 FIRE (300) Submitted Date Division / Department Action Recommendation: Approval of a resolution to purchase bunker gear coats and pants for use by the Fayetteville Fire Department from Lion Manufacturing through NAFECO via the Sourcewell Cooperative Contract #032620-LIO through City of Fayetteville Sourcewell Number #34143. 1010.300.3020-5302.01 Account Number 33047.1 Project Number Budgeted Item? Yes Does item have a direct cost? Yes Is a Budget Adjustment attached? No Purchase Order Number: Change Order Number: Original Contract Number: Comments: Budget Impact: General Fund Fire Department Act 833 Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget Project Title $ 161,179.00 161,179.00 $ 154,439.10 6,739.90 Previous Ordinance or Resolution # Approval Date: V20221130 Page 25 of 425 NAFECO INC. 1203 North II th Street Van Buren, AR 72956 Cell: 479.459.6453 j — Customer Information Name Fayetteville Fire Dept Cust # Address 303 West Center St City Fayettevulle State/Zip AR 72703 Phone Order Number www.nafeco.com Quote Date: 3/12/2023 Terms: NET 30 Purchase Order: FOB: Shipping Point Qty Item Number Unit Price Total LION RedZone Custom Bunker Gear Fayetteville FD spec PSGQ-2694-A 44.00 LION Super Delux Coat PBI MAX $1,820.00 $80,080.00 FFD Ietterinq on Back 51.00 1 ILION Suoer Delux Pant PBI MAX 1 $1,189.001 $60,639.001 LION First Responder Firefighting PPE LION Sourcewell #32620-1-10 If you have any questions concerning this quote please call 1-800-628-6233. Salesperson Michael L Brammer Subtotal $140,719.00 Tax $13,720.10 Shipping $0.00 Order Total; $154,439.10; Page 26 of 425 Page 27 of 425 CITY OF POW, FAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO 2023-626 TO: Mayor Jordan and City Council THRU: Paul Becker, Chief Financial Officer FROM: Kevin Springer, Budget Director DATE: SUBJECT: Approval of a Budget Adjustment to Recognize Interest Revenue on the 2019 Phase I Bonds. RECOMMENDATION: Staff recommends approval of a budget adjustment to recognize interest revenue earned on the 2019 Phase I Bonds. BACKGROUND: On April 9, 2019, the Citizens voted to authorize Sales Tax Bonds of up to $226,065,000 for various purposes as specified in Ordinance 6126 approved by the City Council. Phase One of the bond improvements was approved at the June 4, 2019, City Council meeting which resulted in the final issuance of $127,595,000 par value worth of bonds. From the time of issuance, each bond earns interest revenue and when those additional funds are needed, a budget adjustment is prepared to recognize the interest earned. The total amount of revenue recognized was $1,292,267 and was approved at the following City Council meetings. • November 16, 2021: $315,000 in Police 2019 Bond Project Interest. • December 21, 2021: $65,623 in Drainage 2019 Bond Project Interest. • February 1, 2022: $165,249 in Arts Corridor 2019 Bond Project Interest. • August 2, 2022: $302,120 in Streets 2019 Bond Project Interest. • October 4, 2022: $393,337 in all 2019 Bond Projects. • December 20, 2022: $50,939 in Police 2019 Bond Project Interest. Currently, across all bond projects, a total of $1,728,298.20 has been received in interest revenue earnings, leaving $463,031,20 in revenue to be recognized. DISCUSSION: This item is to recognize the interest paid to date on the Sales and Use Tax Capital Improvement and Refunding Bonds, Series 2019A/B so that the funds may be used on various bond project expenses. Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 28 of 425 BUDGET/STAFF IMPACT: The requested budget adjustment will recognize $436,032 in interest revenue. 2019 Bonds (Series 2019) - Interest Received vs Budgeted Interest rpmo Already Interest Not FUNDIGUACCOUNT Recognized Actuals Recognized 04602 Streets Project 2019 Bonds 352,924 S43,04S.47 (190,121.47) B04603 Trails Project 2019 Bonds 21,026 23AS7.87 (2,461.97) II4604 Drainage Projects 2019 Bonds 80,895 130,635.21 (49,740.21) 334605 Parks Project 2019 Bonds 88,548 92,128.02 (3,580.02) 814606 Economic Development 2019 Bonds 37,092 88,174.97 (51,092.97) (04507 City Facilities 2019 Bonds 4,262 4,808.09 (546.09) Bt4608 Arts Corridor 2019 Bonds 199,218 280,812.67 (81,594.67) W4609 Police Projects 2019 Bonds 413,043 447,002.14 (33,959.14) 14610 Fire Projects 2019 Bonds 95,269 118,203.76 (22,934.76) Grand Total 1,292,267 1,728,298.20 (436,031.20) ATTACHMENTS: 2023-626 SRF - Bond 2019 Interest, 2023-626 BA - Bond 2019 Interest Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 29 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-626 Approval of a Budget Adjustment to Recognize Interest Revenue on the 2019 Phase I Bonds. A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF $463,032.00 RECOGNIZING INTEREST REVENUE GENERATED FROM THE SALES & USE TAX CAPITAL IMPROVEMENT AND REFUNDING BONDS SERIES 2019 BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment, a copy of which is attached to this Resolution, recognizing revenue generated from interest paid on funds for the Sales & Use Tax Capital Improvement and Refunding Bonds Series 2019 in the amount of $463,032.00. Page 1 Page 30 of 425 Kevin Springer Submitted By City of Fayetteville Staff Review Form 2023-626 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 3/28/2023 BUDGET & INFORMATION MGMT (133) Submitted Date Division / Department Action Recommendation: Staff recommends approval of a budget adjustment to recognize interest revenue earned on the Sales and Use Tax Capital Improvement and Refunding Bonds, Series 2019A. 46xx.860.7000-4707.46 Account Number 46xxx.7000 Project Number Budgeted Item? Yes Does item have a direct cost? No Is a Budget Adjustment attached? Yes Purchase Order Number: Change Order Number: Original Contract Number: Comments: Budget Impact: 46xx - Various 2019 Bond Project Funds Fund Various 2019 Bond Projects Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget Project Title $ 1,292,267.00 $ 1,728,298.20 (436,031.20) $ 436,032.00 Previous Ordinance or Resolution # Approval Date: 0.80 V20221130 Page 31 of 425 City of Fayetteville, Arkansas - Budget Adjustment (Agenda) Budget Year Division Adjustment Number BUDGET &INFORMATION MGMT (133) /Org2 2023 Requestor: Kevin Springer BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION: The requested budget adjustment will recognize $436,032 in interest revenue for the 2019 Phase I Bonds. COUNCIL DATE: 4/18/2023 ITEM ID#: 2023-626 Kevin Springer 3/26'/2023 3: qS P/YI Budget Division Date D - (City Council) TYPE: JOURNAL #: GLDATE: RESOLUTION/ORDINANCE CHKD/POSTED: TOTAL 436,032 436,032 v.2023323 increase/ (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 4602.860.7000-4707.46 - 190,122 46020 7000 RE Interest - 2019 Project Funds 4603.860.7000-4707.46 - 2,462 46030 7000 RE Interest - 2019 Project Funds 4604.860.7000-4707.46 - 49,740 46040 7000 RE Interest - 2019 Project Funds 4605.860.7000-4707.46 - 3,580 46050 7000 RE Interest - 2019 Project Funds 4606.860.7000-4707.46 - 51,093 46060 7000 RE Interest - 2019 Project Funds 4607.860.7000-4707.46 - 546 46070 7000 RE Interest - 2019 Project Funds 4608.860.7000-4707.46 - 81,595 46080 7000 RE Interest - 2019 Project Funds 4609.860.7000-4707.46 - 33,959 46090 7000 RE Interest - 2019 Project Funds 4610.860.7000-4707.46 - 22,935 46100 7000 RE Interest - 2019 Project Funds 4602.860.7999-5899.00 190,122 - 46020 7999 EX Unallocated - Budget 4603.860.7999-5899.00 2,462 - 46030 7999 EX Unallocated - Budget 4604.860.7999-5899.00 49,740 - 46040 7999 EX Unallocated - Budget 4605.860.7999-5899.00 3,580 - 46050 7999 EX Unallocated - Budget 4606.860.7999-5899.00 51,093 - 46060 7999 EX Unallocated - Budget 4607.860.7999-5899.00 546 - 46070 7999 EX Unallocated - Budget 4608.860.7999-5899.00 81,595 - 46080 7999 EX Unallocated - Budget 4609.860.7999-5899.00 33,959 - 46090 7999 EX Unallocated - Budget 4610.860.7999-5899.00 22,935 - 46100 7999 EX Unallocated - Budget 1 of 1 Page 32 of 425 CITY OF POW, FAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO 2023-627 TO: Mayor Jordan and City Council THRU: Paul Becker, Chief Financial Officer FROM: Kevin Springer, Budget Director DATE: SUBJECT: A RESOLUTION TO AMEND RESOLUTION 35-23, REDUCING THE AMOUNT OF REAPPROPRIATIONS TO THE 2023 BUDGET BY $3,031,724 AND TO APPROVE A BUDGET ADJUSTMENT. RECOMMENDATION: To reduce the reappropriation amount added to the 2023 budget pursuant to resolution 35-23 by $3,031,724 due to payments made against the 2022 budget which occurred after the adoption of Resolution 35-23. These amounts are reflected in the attached budget adjustment. BACKGROUND: Each year it is necessary for the City Council to reappropriate funds for the new budget because of items that were previously approved which were not yet completed or which were appropriated for future time periods. This was done in 2023 pursuant to resolution 35-23 adopted at the 2/7/2023 City Council meeting. DISCUSSION: After that meeting, payments were submitted and processed for work done or services provided before December 31, 2022. Therefore, these payments were appropriately booked as expenditures against the 2022 budget as required by Generally Accepted Accounting Principles. Many of these expenditures were large in amount and if the appropriations approved for their payment in 2023 are not reduced, it would result in over appropriation of and possible deficits in 2023 individual funds. Therefore, this request (if approved) will adjust the affected budgets to reflect appropriations no longer needed. BUDGET/STAFF IMPACT: The financial impact of approving this resolution is a decrease in the reappropriations and thus the total 2023 expenditure budget by $3,031,724 pursuant to the attached budget adjustment. ATTACHMENTS: 2023 SUMMARY OF REAPPROPRIATIONS, 2023-627 SRF Amendment to 2022 Reappropriations, 2023-627 BA Amendment 2022 Reappropriations Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 33 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-627 A RESOLUTION TO AMEND RESOLUTION 35-23, REDUCING THE AMOUNT OF REAPPROPRIATIONS TO THE 2023 BUDGET BY $3,031,724 AND TO APPROVE A BUDGET ADJUSTMENT. A RESOLUTION TO AMEND RESOLUTION 35-23 BY REDUCING THE AMOUNT OF REAPPROPRIATIONS TO THE 2023 BUDGET BY $3,031,724.00, AND TO APPROVE A BUDGET ADJUSTMENT WHEREAS, on February 7, 2023, the City Council approved Resolution 35-23, which reappropriated funds from the 2022 budget to the 2023 budget for items that were not yet completed or which were appropriated for future time periods; and WHEREAS, after Resolution 35-23 was passed, payments were submitted and processed for work done or services provided before December 31, 2022, and, therefore, those payments should be booked as expenditures against the 2022 budget. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas, hereby amends Resolution 35-23 by reducing the amount of reappropriations to the 2023 budget by $3,031,724.00. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment, a copy of which is attached to this Resolution. Page 1 Page 34 of 425 2023 SUMMARY OF REAPPROPRIATIONS Fund A - Original B - Amendment Grand Total 1010 - General 7,279,359 (289,929) 6,989,430 2100 - Street 3,170,873 24,511 3,195,384 2130 - Parking 490,233 490,233 2180 - Community Development 2,439,182 (13,185) 2,425,997 2246 - American Rescue Plan Act (ARPA) 5,336,884 5,336,884 2250 - Parks Development 4,766,910 (75,851) 4,691,059 2300 - Impact Fee 6,912,248 (98,447) 6,813,801 2930 - Drug Law Enforcement Grant 227,806 (24,825) 202,981 4270 - Disaster & Replacement 462,428 462,428 4470 - Sales Tax Capital Improvement 16,956,565 (567,992) 16,388,573 4601- Bond Program Grant Matching 4,918,039 4,918,039 4602 - Streets Project 2019 Bonds 9,902,626 (336,121) 9,566,505 4603 - Trails Project 2019 Bonds 90,107 (20,569) 69,538 4604 - Drainage Projects 2019 Bonds 2,490,172 (120,731) 2,369,441 4605 - Parks Project 2019 Bonds 168,255 (385) 167,870 4606 - Economic Development 2019 Bonds 3,045,684 3,045,684 4607 - City Facilities 2019 Bonds 32,603 32,603 4608 - Arts Corridor 2019 Bonds 1,924,872 (117,164) 1,807,708 4609 - Police Projects 2019 Bonds 1,248,421 (578) 1,247,843 4610 - Fire Projects 2019 Bonds 881,980 (1,445) 880,535 4702 - Streets Project 2022 Bonds 29,755,969 29,755,969 4703 - Trails Project 2022 Bonds 4,611,107 (21,934) 4,589,173 4704 - Drainage Projects 2022 Bonds 6,896,567 (34,275) 6,862,292 4705 - Parks Project 2022 Bonds 10,947,350 (38,258) 10,909,092 4707 - City Facilities 2022 Bonds 2,713,976 2,713,976 4708 - Arts Corridor 2022 Bonds 12,385,610 (66,418) 12,319,192 4710 - Fire Projects 2022 Bonds 5,832,297 (5,772) 5,826,525 5400 - Water and Sewer 36,190,917 (1,199,309) 34,991,608 5500 - Recycling and Trash Collection 2,447,581 (6,389) 2,441,192 5550 - Airport 1,976,989 (16,608) 1,960,381 9700 - Shop 4,874,390 (50) 4,874,340 Grand Total 191,378,000 (3,031,724) 188,346,276 Page 35 of 425 City of Fayetteville Staff Review Form 2023-627 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Kevin Springer 3/28/2023 BUDGET & INFORMATION MGMT (133) Submitted By Submitted Date Division / Department Action Recommendation: A resolution to amend resolution 35-23, reducing the amount of reappropriations to the 2023 Budget by $3,031,724 and to approve a budget adjustment. VARIOUS Account Number VARIOUS Project Number Budgeted Item? Yes Does item have a direct cost? No Is a Budget Adjustment attached? Yes Purchase Order Number: Change Order Number: Original Contract Number: Comments: Budget Impact: Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget VARIOUS Fund VARIOUS Project Title $ 412,644,584.00 $ 107,754,161.26 304,890,422.74 $ (3,031,724.00) 301,858,698.74 Previous Ordinance or Resolution # Approval Date: V20221130 Page 36 of 425 City of Fayetteville, Arkansas - Budget Adjustment (Agenda) Budget Year Division Adjustment Number BUDGET &INFORMATION MGMT (133) /Org2 2023 23-B01 Requestor: Kevin Springer BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION: A RESOLUTION TO AMEND RESOLUTION 35-23, REDUCING THE AMOUNT OF REAPPROPRIATIONS TO THE 2023 BUDGET BY $3,031,724 AND TO APPROVE A BUDGET ADJUSTMENT. RESOLUTION/ORDINANCE COUNCIL DATE: ITEM ID#: 4/18/2023 2023-627 Kevin Springer 3/26'/2023 6: 37 P/YI Budget Division Date TYPE: D - (City Council) JOURNAL#: GLDATE: CHKD/POSTED: TOTAL (3,031,724) (3,031,724) v.2023223 increase/ (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 1010.001.0001-4999.97 - (465,870) RE Use Fund Balance - Prior 1010.300.3020-4308.00 24,223 33047 1 RE Public Safety Acts - Fire Act 833 1010.300.3020-4308.00 151,718 33047 900 RE Public Safety Acts - Fire Act 833 1010.060.0600-5314.00 (44) - 51022 1101 EX Professional Services 1010.090.6600-5210.00 (2,385) - 32208 2022 EX Minor Equipment 1010.090.6600-5210.00 (673) - 43020 1 EX Minor Equipment 1010.131.1310-5210.00 4,304 - EX Minor Equipment 1010.160.1610-5210.00 821 - EX Minor Equipment 1010.200.2900-5210.00 14,752 - EX Minor Equipment 1010.200.2900-5315.00 14,583 - EX Contract Services 1010.200.2920-5120.00 (54,667) - 32104 2021 EX Personnel Other - Contra 1010.200.2920-5120.00 (27,566) - 31607 2223.4309 EX Personnel Other - Contra 1010.200.2920-5210.00 (280,815) - 02047 7900.8802 EX Minor Equipment 1010.200.2920-5210.00 (1,973) - 32205 2022 EX Minor Equipment 1010.200.2920-5210.00 (547) - 37042 2020 EX Minor Equipment 1010.200.2920-5210.00 (149) - 37042 2021 EX Minor Equipment 1010.200.2920-5210.00 81 - 39022 2019 EX Minor Equipment 1010.200.2920-5304.00 (8,776) - 39022 2019 EX Travel & Training Page 37 of 425 Increase / (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 1010.200.2920-5304.00 (3,843) - 32205 2022 EX Travel & Training 1010.200.2920-5304.00 2,754 - 39022 2021 EX Travel & Training 1010.200.2920-5310.01 (266) - 32205 2022 EX Utilities - Telephone 1010.200.2940-5302.00 37,691 - EX Uniforms/Personal - Equipment 1010.200.2940-5302.00 6,327 - EX Uniforms/Personal - Equipment 1010.520.5220-5315.00 6,173 - 33051 6 EX Contract Services 1010.520.5220-5342.00 2,288 - 33051 6 EX Promotionals - Activities 1010.520.5280-5342.00 (1,000) - 33051 1001 EX Promotionals - Activities 1010.631.6310-5315.00 7,902 - EX Contract Services 1010.671.2740-5200.03 (602) - 33048 1 EX Supplies - Veterinary 1010.671.2740-5205.00 (45) - 33048 1 EX Dog Food And Supplies 1010.671.2740-5315.00 (4,254) - 33048 1 EX Contract Services 2100.410.4100-4999.97 - 24,511 RE Use Fund Balance - Prior 2100.410.4120-5204.00 33,646 - EX Chemicals 2100.410.4120-5216.00 6,187 - EX Construction Materials 2100.410.5500-5814.00 (15,322) - 02053 5500 EX Improvements - Sidewalks 2180.642.4930-4999.97 - (13,185) RE Use Fund Balance - Prior 2180.642.4930-5104.00 (2,598) - EX Accruals - General 2180.642.4940-5104.00 (9,151) - EX Accruals - General 2180.642.4945-5104.00 2,484 - EX Accruals - General 2180.642.4945-5200.01 (41) - EX Supplies - Copies/Lease 2180.642.4945-5303.00 15 - EX Publications & Dues 2180.642.4945-5310.01 (43) - EX Utilities - Telephone 2180.642.4945-5390.01 (1,062) - 32003 1 EX CDBG Projects - Community Outreach Projf 2180.642.4945-5403.00 100 - EX Maintenance - Vehicle & Machine 2180.642.4956-5303.00 (965) - EX Publications & Dues 2180.642.4957-5303.00 (563) - EX Publications & Dues 2180.642.4958-5308.90 665 - EX Rental - Rent Assistance 2180.642.4970-5390.03 (2,031) - EX CDBG Projects - Aging Transportation 2180.642.4970-5390.69 5 - EX CDBG Projects - CU Methodist Church 2250.520.9250-4999.97 - (75,851) RE Use Fund Balance - Prior 2250.520.9250-5200.05 759 - 33051 8 EX Supplies - Tournament/Awards 2250.520.9255-5301.00 (31) - 13001 2001 EX Public Notification 2250.520.9255-5314.00 (5,000) - 13001 7504.1000 EX Professional Services 2250.520.9255-5806.00 (22,250) - 13001 1902 EX Improvements - Park 2250.520.9255-5806.00 (21,610) - 02013 2201 EX Improvements - Park 2250.520.9255-5806.00 (6,233) - 13001 1801 EX Improvements - Park 2250.520.9255-5806.00 (1,959) - 13001 2001 EX Improvements - Park 2250.520.9256-5806.00 (3,601) - 46050 7502.1000 EX Improvements - Park 2250.520.9256-5814.05 (15,926) - 13001 1802 EX Improvements - Trails 2300.200.9300-4999.97 - (98,447) RE Use Fund Balance - Prior 2300.200.9300-5210.00 (98,447) - 07001 7900.8802 EX Minor Equipment 2930.200.2960-4999.97 - (24,825) RE Use Fund Balance - Prior 2930.200.2960-5120.00 (4,444) - 32229 2022 EX Personnel Other - Contra 4470.001.9470-4999.97 - (567,992) RE Use Fund Balance - Prior 4470.090.8900-5220.00 424 - 22004 1 EX Landscape Materials 2of6 Page 38 of 425 Increase / (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 4470.090.8900-5314.00 (14,985) - 22005 1 EX Professional Services 4470.090.8900-5315.00 (11,768) - 15008 1 EX Contract Services 4470.090.8900-5400.00 (732) - 15008 1 EX Building & Grounds - Maintenance 4470.140.8900-5400.00 (126,488) - 02046 1 EX Building & Grounds - Maintenance 4470.140.8900-5400.00 (370) - 02046 0202 EX Building & Grounds - Maintenance 4470.140.8900-5400.00 (55) - 02046 1502 EX Building & Grounds - Maintenance 4470.170.8170-5210.00 (1,226) - 02057 1 EX Minor Equipment 4470.170.8170-5210.00 (689) - 02056 1 EX Minor Equipment 4470.170.8170-5210.00 1,775 - 09028 1 EX Minor Equipment 4470.170.8170-5315.00 (3,948) - 09028 1 EX Contract Services 4470.200.8200-5210.00 (31,357) - 02047 7900.8802 EX Minor Equipment 4470.200.8200-5210.00 (11,079) - 06002 1 EX Minor Equipment 4470.200.8200-5210.00 (3,414) - 13011 1 EX Minor Equipment 4470.200.8200-5400.00 11 - 21014 1 EX Building & Grounds - Maintenance 4470.300.8300-5210.00 215 - 21001 1 EX Minor Equipment 4470.300.8300-5210.00 467 - 02006 1 EX Minor Equipment 4470.300.8300-5400.00 (12,248) - 02006 1 EX Building & Grounds - Maintenance 4470.410.8410-5210.00 59 - 02063 1 EX Minor Equipment 4470.410.8410-5399.03 (44,302) - 02052 1 EX Cost Allocation - Motorpool Reimbursemer 4470.410.8410-5417.00 1,123 - 02052 1 EX Maintenance - Street 4470.410.8410-5418.00 (3,403) - 02053 1 EX Maintenance - Sidewalk 4470.410.8410-5814.00 (1,228) - 02053 1 EX Improvements - Sidewalks 4470.520.8520-5308.03 (12,957) - 02001 1 EX Rental - Equipment 4470.520.8520-5314.00 (9,762) - 18022 1 EX Professional Services 4470.520.8520-5399.03 (731) - 15012 1 EX Cost Allocation - Motorpool Reimbursemer 4470.520.8520-5400.00 (30) - 02001 1 EX Building & Grounds - Maintenance 4470.520.8520-5806.00 (3,277) - 15011 1 EX Improvements - Park 4470.520.8520-5806.00 422 - 08001 1 EX Improvements - Park 4470.620.8900-5315.00 (6,010) - 21003 1 EX Contract Services 4470.621.8810-5314.00 (30,791) - 02108 1 EX Professional Services 4470.621.8810-5817.00 (1,206) - 02108 1 EX Improvements - Bridge & Drainage 4470.800.8830-5211.00 (31,238) - 02016 1002 EX Street Marking Materials 4470.800.8830-5330.05 (9,363) - 02016 1 EX Labor charges 4470.800.8830-5399.03 (10,724) - 02016 1 EX Cost Allocation - Motorpool Reimbursemer 4470.800.8830-5420.00 (8,590) - 02016 1301 EX Trail Maintenance 4470.800.8830-5814.05 (2,403) - 02016 2003 EX Improvements - Trails 4470.800.8830-5814.05 (2,121) - 02016 7302 EX Improvements - Trails 4470.800.8835-5809.00 (175,993) - 06035 2101 EX Improvements - Street 4602.860.7000-4999.97 - (336,121) RE Use Fund Balance - Prior 4602.860.7000-5860.03 (963) - 46020 7000 EX Capital Prof Svcs - Internal Support 4602.860.7000-5860.04 (22,650) - 46020 7000 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7212-5860.04 (9,059) - 46020 7212 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7213-5860.04 (8,831) - 46020 7213 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7214-5860.04 (4,057) - 46020 7214.1020 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7214-5860.04 (89) - 46020 7214.1010 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7216-5860.04 (533) - 46020 7216.1000 EX Capital Prof Svcs - Contra (Engineering) 3of6 Page 39 of 425 Increase / (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 4602.860.7218-5860.04 (14,611) - 46020 7218.1000 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7219-5809.00 (164,963) - 46020 7219 EX Improvements - Street 4602.860.7219-5860.02 (9,790) - 46020 7219 EX Capital Prof Svcs - Engineering/Architectur 4602.860.7219-5860.04 (870) - 46020 7219 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7220-5860.04 (2,169) - 46020 7220 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7221-5809.00 (48,859) - 46020 7221.1010 EX Improvements - Street 4602.860.7221-5860.02 (21,258) - 46020 7221.1020 EX Capital Prof Svcs - Engineering/Architectur< 4602.860.7221-5860.04 (4,275) - 46020 7221.1010 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7221-5860.04 (371) - 46020 7221.1000 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7223-5860.02 (19,760) - 46020 7223 EX Capital Prof Svcs - Engineering/Architectur< 4602.860.7223-5860.04 (1,529) - 46020 7223 EX Capital Prof Svcs - Contra (Engineering) 4602.860.7227-5860.04 (1,484) - 46020 7227 EX Capital Prof Svcs - Contra (Engineering) 4603.860.7000-4999.97 - (20,569) RE Use Fund Balance - Prior 4603.860.7000-5860.03 (289) - 46030 7000 EX Capital Prof Svcs - Internal Support 4603.860.7302-5860.04 (10,085) - 46030 7302 EX Capital Prof Svcs - Contra (Engineering) 4603.860.7999-5899.00 (10,195) - 46030 7999 EX Unallocated - Budget 4604.860.7000-4999.97 - (120,731) RE Use Fund Balance - Prior 4604.860.7000-5860.03 (125) - 46040 7000 EX Capital Prof Svcs - Internal Support 4604.860.7410-5817.00 (106,306) - 46040 7410.1000 EX Improvements - Bridge & Drainage 4604.860.7410-5860.04 (504) - 46040 7410.1000 EX Capital Prof Svcs - Contra (Engineering) 4604.860.7415-5860.04 (2,999) - 46040 7415.1000 EX Capital Prof Svcs - Contra (Engineering) 4604.860.7420-5860.02 (2,540) - 46040 7420.1000 EX Capital Prof Svcs - Engineering/Architectur< 4604.860.7420-5860.04 (550) - 46040 7420.1000 EX Capital Prof Svcs - Contra (Engineering) 4604.860.7999-5899.00 (7,707) - 46040 7999 EX Unallocated - Budget 4605.860.7000-4999.97 - (385) RE Use Fund Balance - Prior 4605.860.7000-5860.03 (385) - 46050 7000 EX Capital Prof Svcs - Internal Support 4608.860.7000-4999.97 - (117,164) RE Use Fund Balance - Prior 4608.860.7000-5860.03 (818) - 46080 7000 EX Capital Prof Svcs - Internal Support 4608.860.7800-5860.02 (75,578) - 46080 7800 EX Capital Prof Svcs - Engineering/Architectur< 4608.860.7820-5860.02 (40,768) - 46080 7820 EX Capital Prof Svcs - Engineering/Architectur< 4609.860.7000-4999.97 - (578) RE Use Fund Balance - Prior 4609.860.7000-5860.03 (298) - 46090 7000 EX Capital Prof Svcs - Internal Support 4609.860.7999-5899.00 (280) - 46090 7999 EX Unallocated - Budget 4610.860.7000-4999.97 - (1,445) RE Use Fund Balance - Prior 4610.860.7000-5860.03 (529) - 46100 7000 EX Capital Prof Svcs - Internal Support 4610.860.7108-5210.00 584 - 46100 7108.8802 EX Minor Equipment 4610.860.7999-5899.00 (1,500) - 46100 7999 EX Unallocated - Budget 4703.860.7000-4999.97 - (21,934) RE Use Fund Balance - Prior 4703.860.7304-5860.02 (21,934) - 46030 7304 EX Capital Prof Svcs - Engineering/Architectur< 4704.860.7000-4999.97 - (34,275) RE Use Fund Balance - Prior 4704.860.7000-5301.00 (198) - 46040 7000 EX Public Notification 4704.860.7405-5805.00 (34,077) - 46040 7405 EX Land - Acquisition 4705.860.7000-4999.97 - (38,258) RE Use Fund Balance - Prior 4705.860.7000-5301.00 (644) - 46050 7000 EX Public Notification 4705.860.7540-5860.02 (37,517) - 46050 7540 EX Capital Prof Svcs - Engineering/Architecture 4705.860.7999-5899.00 (97) - 46050 7999 EX Unallocated - Budget 4of6 Page 40 of 425 Increase / (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 4708.860.7000-4999.97 - (66,418) RE Use Fund Balance - Prior 4708.860.7800-5860.02 (66,322) - 46080 7800 EX Capital Prof Svcs - Engineering/Architecture 4708.860.7999-5899.00 (96) - 46080 7999 EX Unallocated - Budget 4710.860.7000-4999.97 - (5,772) RE Use Fund Balance - Prior 4710.860.7110-5860.02 (5,675) - 46100 7110.8630 EX Capital Prof Svcs - Engineering/Architecture 4710.860.7999-5899.00 (97) - 46100 7999 EX Unallocated - Budget 5400.720.1840-5210.00 (1,295) - 02057 5400 EX Minor Equipment 5400.720.1840-5801.00 1,295 - 02057 5400 EX Fixed Assets 5400.720.4000-4999.97 - (1,199,309) RE Use Fund Balance - Prior 5400.720.4310-5311.04 3,172 - EX Insurance - Self (Non -Vehicle Damage) 5400.720.4310-5311.04 8,156 - EX Insurance - Self (Non -Vehicle Damage) 5400.720.4310-5311.04 1,647 - EX Insurance - Self (Non -Vehicle Damage) 5400.720.4310-5311.04 4,939 - EX Insurance - Self (Non -Vehicle Damage) 5400.720.4310-5315.00 4,610 - EX Contract Services 5400.720.5600-5314.00 (72,862) - 12009 1 EX Professional Services 5400.720.5600-5314.00 (71,282) - 18015 2201 EX Professional Services 5400.720.5600-5314.00 (9,596) - 12009 1801 EX Professional Services 5400.720.5600-5314.00 (9,372) - 11011 2102 EX Professional Services 5400.720.5600-5314.00 (9,312) - 14010 1 EX Professional Services 5400.720.5600-5314.00 (2,535) - 10006 1 EX Professional Services 5400.720.5600-5808.00 (72,916) - 12009 2101 EX Improvements - Water Line 5400.720.5600-5808.00 (65,000) - 10006 1 EX Improvements - Water Line 5400.720.5600-5808.00 (27,487) - 14010 1 EX Improvements - Water Line 5400.720.5700-5314.00 (58,861) - 02017 1 EX Professional Services 5400.720.5700-5314.00 (9,372) - 11011 2102 EX Professional Services 5400.720.5700-5815.00 (87,570) - 04039 1 EX Improvements - Sewer 5400.730.5100-5328.00 (35,992) - EX WWTP Contract - PCP Operations 5400.730.5110-5328.00 (114,999) - EX WWTP Contract - PCP Operations 5400.730.5120-5328.00 (21,381) - EX WWTP Contract - PCP Operations 5400.730.5130-5328.00 (53,084) - EX WWTP Contract - PCP Operations 5400.730.5140-5328.00 (203,584) - EX WWTP Contract - PCP Operations 5400.730.5800-5308.03 (73,735) - 02032 1 EX Rental - Equipment 5400.730.5800-5314.00 (74,853) - 02032 1 EX Professional Services 5400.730.5800-5314.00 (51,273) - 13018 1 EX Professional Services 5400.730.5800-5400.00 (17,382) - 02032 1 EX Building & Grounds - Maintenance 5400.730.5800-5400.00 68 - 02068 1 EX Building & Grounds - Maintenance 5400.730.5800-5414.00 364 - 02069 1 EX Maintenance - Plant Equipment 5400.730.5800-5801.00 206 - 02032 1 EX Fixed Assets 5400.730.5800-5801.00 4,896 - 02069 1 EX Fixed Assets 5400.860.5600-5860.02 (2,105) - 11011 2019.7800 EX Capital Prof Svcs - Engineering/Architectur< 5400.860.5700-5815.00 (82,814) - 11011 2019.7221 EX Improvements - Sewer 5500.750.5000-4999.97 - (6,389) RE Use Fund Balance - Prior 5500.750.5000-5400.00 1,186 - EX Building & Grounds - Maintenance 5500.750.5060-5403.00 2,380 - EX Maintenance - Vehicle & Machine 5500.750.5080-5870.00 (9,955) - 10001 1 EX Container Costs 5550.760.3940-4999.97 - (16,608) RE Use Fund Balance - Prior 5of6 Page 41 of 425 Increase / (Decrease) Project.Sub# Account Number Expense Revenue Project Sub.Detl AT Account Name 5550.760.3960-5314.00 (1,558) - 15029 1 EX Professional Services 5550.760.3960-5860.02 (15,050) - 32206 2022 EX Capital Prof Svcs - Engineering/Architecture 9700.770.1910-4999.97 - (50) RE Use Fund Balance - Prior 9700.770.1920-5802.00 (1,124) - 02081 2021 EX Vehicles & Equipment - base 9700.770.1920-5802.00 (70) - 02081 2022 EX Vehicles & Equipment - base 9700.770.1920-5802.00 1,144 - 02083 2019 EX Vehicles & Equipment - base 2930.200.2960-5120.00 (20,381) - 38070 2002 EX Personnel Other - Contra 5400.730.5800-5314.00 8,262 02032 1 EX Professional Services 5400.730.5800-5400.00 (8,262) - 02032 1 EX Building & Grounds - Maintenance 4470.800.8835-4420.00 - (1,792,211) 06035 2101 RE Payments by Property Owners - base 4470.800.8835-4309.00 - 1,792,211 06035 2101 RE Federal Grants - Capital 4470.800.8835-4309.00 - (2,380,847) 06035 7213 RE Federal Grants - Capital 4470.800.8835-4309.00 - 1,745,700 06035 3400 RE Federal Grants - Capital 4470.001.9470-4999.97 - 635,147 RE Use Fund Balance - Prior 2250.520.9255-4305.00 - 635,475 46050 7540 RE Grants - Commercial 2250.520.9250-4999.97 - (635,475) RE Use Fund Balance - Prior 6 of 6 Page 42 of 425 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO 2023-648 TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff FROM: Tim Nyander, Utilities Director DATE: SUBJECT: Northwest Arkansas Land Trust - West Side Prairie Habitat Restoration and Management RECOMMENDATION: Staff recommends the approval of a Contract for Habitat Restoration and Management of West Side Prairie between the City of Fayetteville, Arkansas and Northwest Arkansas Land Trust in an amount not to exceed $20,000.00 for a term of one year. BACKGROUND: The Northwest Arkansas Land Trust has maintained the West Side Prairie near the West Side Treatment Facility since 2020. They have worked on restoring the prairie habitat and also performing ecological management services for the West Side Prairie. The current contract has expired, so staff has negotiated a new contract with Northwest Arkansas Land Trust to continue the habitat restoration and management. DISCUSSION: Due to their expertise in habitat restoration and management, Northwest Arkansas Land Trust was selected to perform these services on behalf of the City of Fayetteville. Services to be provided include: 1. Use adaptive restoration strategies to restore the site to native tall grass prairie and savannah habitat. 2. Use adaptive management strategies to properly manage habitat for native tall grass prairie and savanna species. 3. Install and manage appropriate infrastructure for public access. 4. Administer and manage work schedules, vendors, and contractors, and coordinate with proper City of Fayetteville staff. BUDGET/STAFF IMPACT: Funds are available in the Wetlands Bank Construction account within the Water and Sewer fund. This agreement may be renewed for 5 additional one (1) year terms with mutual agreement of the parties. ATTACHMENTS: SRF Northwest Arkansas Land Trust, NWALT_Contract for WSP_ Signed_03222023 Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 43 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-648 Northwest Arkansas Land Trust - West Side Prairie Habitat Restoration and Management A RESOLUTION TO AUTHORIZE A ONE YEAR CONTRACT WITH THE NORTHWEST ARKANSAS LAND TRUST IN THE AMOUNT OF $20,000.00 FOR HABITAT RESTORATION AND MANAGEMENT AT THE WEST SIDE PRAIRIE WITH AN OPTION TO RENEW FOR FIVE ADDITIONAL ONE YEAR TERMS BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan to sign a one year Contract with the Northwest Arkansas Land Trust, a copy of which is attached to this Resolution, in the amount of $20,000.00 for habitat restoration and management services at the West Side Prairie near the West Side Wastewater Treatment Facility with an option to renew for five additional one year terms. Page 1 Page 44 of 425 Tim Nyander Submitted By City of Fayetteville Staff Review Form 2023-648 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 3/29/2023 WASTEWATER TREATMENT (730) Submitted Date Division / Department Action Recommendation: Staff recommends the approval of a Contract for Habitat Restoration and Management of West Side Prairie between the City of Fayetteville, Arkansas and Northwest Arkansas Land Trust in an amount not to exceed $20,000.00 for a term of one year. 5400.730.5800-5314.00 Account Number 11013.1 Project Number Budgeted Item? Yes Does item have a direct cost? Yes Is a Budget Adjustment attached? No Purchase Order Number: Change Order Number: Original Contract Number: Comments: Budget Impact: Water and Sewer Fund Wetlands Bank Construction Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget Project Title $ 290,088.00 $ 148,303.37 r- 141,784.63 $ 20,000.00 121,784.63 Previous Ordinance or Resolution # Approval Date: V20221130 Page 45 of 425 CONTRACT FOR HABITAT RESTORATION AND MANAGEMENT OF WEST SIDE PRAIRIE BETWEEN THE CITY OF FAYETTEVILLE, ARKANSAS AND NORTHWEST ARKANSAS LAND TRUST WHEREAS, City of Fayetteville, Arkansas is the owner of property known as West Side Prairie located in Fayetteville, Arkansas and; WHEREAS, the City of Fayetteville, Arkansas desires to contract for Habitat Restoration and Management services for West Side Prairie and; WHEREAS, on February 18, 2020, the Northwest Arkansas Land Trust was selected by the City Council to perform Habitat Restoration and Management services for the City of Fayetteville, Arkansas at West Side Prairie due to their expertise in habitat restoration and management and; WHEREAS, Northwest Arkansas Land Trust is a local, accredited land trust with expertise in habitat restoration and management, public access infrastructure and maintenance, and who follows current standards and practices as established by the Land Trust Accreditation Commission to help ensure, among other things, the proper stewardship and permanence of lands protected by conservation casements and; WHEREAS, the City Council of Fayetteville, Arkansas has approved a contract with Northwest Arkansas Land Trust for Habitat Restoration and Management of West Side Prairie, NOW THERFORE: In consideration of the mutual promises contained in this Agreement and other good and valuable consideration, 1. Agreement is made this day of , 2023 between the City of Fayetteville, Arkansas located at 113 W. Mountain, Fayetteville, Arkansas 72701 and the Northwest Arkansas Land Trust located at 1725 S. Smokehouse Trail, Fayetteville, Arkansas 72701. 2. Term: This agreement shall be for a term of one (1) year. This contract may be cancelled by either party within 30 days of written notice. 3. Renewals: This agreement may be renewed for 5 additional one (1) year terms with mutual agreement of the parties. 4. Agpendix and Attachments: The Contract documents which comprise this contract between the City of Fayetteville and Northwest Arkansas Land Trust consist of this Contract and the following documents attached hereto, and made part thereof: a. Appendix A- Northwest Arkansas Land Trust Scope of Services for Restoration and Management of West Side Prairie b. Attachment B- Survey of West Side Prairie 5. Services to be Provided: During the terms of the Agreement, Northwest Arkansas Land Trust shall: Page 46 of 425 a. Use adaptive restoration strategies to restore the site to native tall grass prairie and savannah habitat. b. Use adaptive management strategies to properly manage habitat for native tall grass prairie and savanna species. c. Install and manage appropriate infrastructure for public access. d. Administer and manage work schedules, vendors, and contractors, and coordinate with proper City of Fayetteville staff. 6. Fees and Expenses: The City of Fayetteville agrees fees for service shall be paid upon invoice as follows: a. Services shall be invoiced for each quarter not to exceed $20,000,00 for the term. b. Northwest Arkansas Land Trust will track and report all expenses related to this Agreement along with the invoice for payment for each quarter. c. Invoices shall be itemized. 7.Notices: Any notice required to be given under this Agreement to either party to the other shall be sufficient if addressed and mailed, certified mail, postage paid, delivery, or overnight courier. S. ApUlicable La : The Agreement shall be governed by and construed in accord with the laws of the State of Arkansas. 9. Entire Agreement: This Agreement sets forth the entire agreement and understanding of the parties on the subject matter of this Agreement. Neither party shall be bound by any conditions, definitions, representations, or warranties with respect to the subject matter of this Agreement other than those as expressly provided herein. 10. Amendments and Waivers: Changes, modifications, or amendments in scope, price or fees to this contract shall not be allowed without a prior formal contract amendment approved by the Mayor and the City Council in advance of the change of scope, cost, or fees. No modification of this Agreement shall be binding unless made in writing and executed by both parties. No waiver by either party or any breach or obligation of the other party under this Agreement shall constitute a waiver or any other of any other prior or subsequent breach or obligation. 11. Deliverables: Northwest Arkansas Land Trust shall provide the following deliverables. One: Adaptive Habitat Restoration and Management of Historic Prairie & Savanna In keeping with an adaptive approach to habitat management as outlined in the 2020 Habitat Conservation & Management Plan, NWALT will employ a variety of plant management techniques to control invasive and exotic plant species on the site. Routine maintenance shall include but not be limited to spot treating with herbicides, mulching, top cutting for seed control, and prescribed fire. Informal botanical surveys will be conducted seasonally to document new occurrences of exotic species as well as previously unobserved native plant species. NWALT will regularly survey for and remove litter and refuse from along roadways and within the prairie as necessary. Deliverables: Adaptive plant management and litter pickup 2 Page 47 of 425 Two: Public Access Infrastructure NWALT will regularly maintain the established 1-mile trail loop within the prairie. This will primarily consist of mowing and may include the addition of seasonal wet weather crossings as outlined in the Public Access Plan.' NWALT will install 3 strategically placed interpretive signs along the trail loop to interpret the natural history of the prairie. NWALT will continue to work with the City to design and install an appropriate parking area for the prairie as outlined in the Public Access Plan and in accordance with the 2020 conservation easement guidelines. NWALT will install a trailhead kiosk at the parking area to interpret the site with regulatory language to protect conservation values and purposes on both Westside Prairie and the adjacent Woolsey Wet Prairie Sanctuary. Deliverables: Maintenance of trail, installation of signs, installation of parking area and kiosk Three_ Administration and Reporting NWALT will manage all facets of work under this scope of services including but not limited to work timelines, communications, contractors, vendors, staff, and volunteers (if used). NWALT will submit one annual report to include work performed, updates for any new plant species observed, and recommendations for future management actions. Deliverables: Project management and oversight, annual report 12. Contract Administration: The Mayor or his/her Designated Representative shall be the Contract Administrator for this contract. The Northwest Arkansas Land Trust Executive Director or her/his Designated Representative shall be the primary contact for all matters pertaining to this contract. Freedom of Information Act: City contracts and documents prepared while performing city contractual work are subject to the Arkansas Freedom of Information Act. If a Freedom of Information Act request is presented to the City of Fayetteville, Northwest Arkansas Land Trust will do everything possible to provide the documents in a prompt and timely manner as prescribed in the Arkansas Freedom of Information Act (A.C.A. §25-19-101 et. seq.). Only legally authorized photocopying costs pursuant to the FOIA may be assessed for this compliance. Page 48 of 425 IN WITNESS WHEREOF, the parties have executed this Agreement. Northwest Arkansas Land Trust By: � ;0�120 - Date: Grady Spann, ecutiv • ector/CEO Witness: Date: Z The City of Fayetteville, Arkansas By: Lioneld Jordan, Mayor Attest: Date: Kara Paxton, City Clerk/Treasurer 4 Page 49 of 425 itNORTHWEST AR ANSAS Lk" TRUST February 24, 2023 Northwest Arkansas Land Trust 1725 S. Smokehouse Trail Fayetteville, AR 72703 (479) 966-4666 Project Manager Marson dance, Director of Land Stewardship & Research mnancePnwaIandtrust.org Attn: Tim Nyander, Utilities Director 479.575,.8386 tnyanclerCDfaVetteville-ar.gov Scope of Services for the City of Fayetteville, Arkansas Westside Prairie Restoration and Management The Northwest Arkansas Land Trust (NWALT) is pleased to provide this Scope of Services to The City of Fayetteville, Arkansas (City) for restoration and management of the Westside Prairietract located north of the WVestside Water Treatment Facility on City owned property. West Side Prairie is a remnant of relatively undisturbed tallgrass prairie and part of a larger mosaic of sustainable practices which include a wetland mitigation site and solar arrays. The conservation of this prairie remnant is an important addition to the existing facilities and provides ecosystem services such as carbon sequestration, wildlife habitat, and stormwater management. The scope detailed below is for 12 months of work and includes habitat restoration and management activities and improving public accessibility. Task 1 ADAPTIVE HABITAT RESTORATION AND MANAGEMENT OF HISTORIC PRAIRIE 1.1 Control and Management of Exotic and Invasive Plant Species In keeping with an adaptive approach to habitat management as outlined in the 2420 Habitat Conservation & Management Plan, NINALT will employ a variety of plant mana,gernent techniques to control invasive and exotic plant species on the site: Routine maintenance shall include but not be limited to spot treating with herbicides, mulching, top cutting for seed control, and prescribed fire. Informal botanical surveys will be conducted seasonally to document new occurrences of exotic species .as well as previously unobserved native plant species. 5 Page 50 of 425 1.2 Litter Cleanup along Site Boundaries NWALT will regularly survey for and remove Fitter and refuse from along roadways and within the prairie as necessary. Deliverables: Adaptive pion management and letter pickup Task 2 PUBLIC ACCESS AND INFRASTRUCTURE 2.1 Routine Mowing and Maintenance of 1 Mile Trail Loop NWALT will regularly maintain the established 1-mile trail loop within the prairie. This will primarily consist of mowing and may include the addition of seasonal wet weather crossings as outlined in the Public Access Plan. 2.2 Installation of Interpretive Signage NWALT will install 3 strategically placed interpretive signs along the trail loop to interpret the natural history of the prairie. 2.3 Installation of Parking Area and Trailhead Kiosk NWALT will continue to work with the City to design and install an appropriate parking area for the prairie as outlined in the Public Access Plan and in accordance with the 2020 conservation easement guidelines. NWALT will install a trailhead kiosk at the parking area to interpret the site with reguiato ry language to protect conservation values and purposes an bath WestsAe Prairie and the adjacent Woolsey Wet Prairie Sanctuary. Deliverables, Ntaintenance of trail, installation of signs, installation of parking ores and kiosk Task 3 ADMINISTRATION AND REPO R71NG 3.1 Project Management NWALT will manage all facets of work under this scope of services including but not firnited to work timelines, communications, contractors, vendors, staff, and volunteers (if used). 3.2" Reporting NWALT will submit one annual report to include work performed, updates for any new plant species observed, and recommendations for future management actions. Deliverables: Project man€rgernent and oversight, annualreport Budget Task dumber Action(s) Fee Estimate 1 Restoration & Management $11,000.00 2 Public Access & Infrastructure $8,000,00 3 Administration & Reporting $1,000,00 TOTAL I 5 20,000.4D Page 51 of 425 R9.0 Noi97weet CattiCr N'N iAa, NE fl4 S'd&bn M - $ 9714x1P' E B4,9f! PFRSIWUON STREET RW 87"42*12" E I 678,40' PAS-- � � 4'�b 17 IE E m 8 ^ 31 °47'27"'S cn R = 288.50' —.� L 160.08' u rn GHOFtf7: S 87NV22" E N 76158.03, £ — • 138.60' I Tn#al Area a T.] 41,10 Acres i ` w — �a cnym �nevin N 87'42'04" U�. 12'9 83' W 11-1�31 Cn a + CO 7ECrtEc�1d27 p �� I GAy of Fsyerieala I4 o c �• SW,NE 1t.16:+7 N 88°32'12" W 1103.86' Selz Psis L'es�a Page 52 of 425 Page 53 of 425 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff FROM: Alison Jumper, Director of Parks, Natural Resources and Cultural Affairs DATE: SUBJECT: Park Impact Fee Study RECOMMENDATION: A resolution to approve engaging a consultant to perform a park impact fee study. BACKGROUND: 2023-650 The City of Fayetteville has long valued the benefits of parks as evidenced by adopting its park land dedication ordinance in 1981. This set a precedent for the state. Still, Fayetteville and Bentonville are the only two cities in Arkansas that we are aware that have a park land dedication ordinance or impact fee requirement. Our ordinance has been amended several times to adapt to different circumstances such as adding and omitting minimum park requirements and updating the ratio that determines fees and amount of land to be dedicated. The ordinance applies to residential lot splits, subdivisions, large scale developments, planned zoning districts, large scale site improvement plans, and small scale site improvement plans; provided that these requirements shall not apply to a lot split or subdivision that does not create one (1) or more vacant lots on which a residential structure could be erected pursuant to the Unified Development Code, and give the developer the option to dedicated land of their choice or fee in lieu. The ordinance has generated approximately $10,738,686 for park land acquisition and development and 290 acres of park land since being adopted. The past six years have generated approximately $3,758,940 and just over 33 acres. Of those 33 acres, only approximately 5.5 are suitable for anything other than a sitting space and much is in the floodway and floodplain. DISCUSSION: While the current park land dedication ordinance has served the city well for many years, as the city has grown, development patterns have changed and park needs have changed, and a new process for offsetting impacts to the park system is needed. During the time the ordinance was adopted, land was developing in large tracts, in less dense patterns, which afforded the opportunity to plan for adequate parks through park land dedication. Development patterns have shifted towards a denser form, on smaller parcels, which limits opportunity for the dedication of quality park land to meet the needs of the development in that area. We are at a moment where we have adequate park acreage; however, we still have gaps in park service. Most Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 54 of 425 of our park acreage is on the periphery of the city in large regional and community parks. Some areas central to the city are not adequately served by park and greenspace, and targeted acquisition is necessary to fill the gap. Our current ordinance severely limits where we can gain land; and in fact, has prevented us from acquiring suitable park land where we need it. Most of the land that has been dedicated in the last five years has been undevelopable land, providing for conservation park. The city strives to provide a variety of types of parks, and spaces for active parks have been minimal. A new Park and Recreation System Master Plan was adopted earlier this year that recommends updating the way we assess for park impacts. Additionally, it sets a goal to provide park and trail opportunities within a 10- minute walk of every resident. The current ordinance does not allow targeted acquisition which is critical to creating a park system that best serves our growing city. If approved, staff would move forward with selecting a qualified consultant using our selection process and a separate resolution will be proposed to approve a contract. BUDGET/STAFF IMPACT: Funding has been approved for this study in the current 2023 budget. If approved, a separate resolution will be and submitted to approve a contract. ATTACHMENTS: 2023 Imapct Fee Proposal SRF, PLD Ord Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 55 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-650 Park Impact Fee Study A RESOLUTION TO EXPRESS THE INTENT OF THE CITY COUNCIL TO ENGAGE A CONSULTANT TO PERFORM A PARK IMPACT FEE STUDY WHEREAS, the City of Fayetteville has long valued the benefits of parks as evidenced by the adoption of the first parkland dedication ordinance in 1981 but, as the City has grown, development patterns have changed and park needs have changed; and WHEREAS, the new Parks and Recreation System Master Plan adopted on March 7, 2023 recommends updating the City's method of assessment for park impacts and sets a goal of providing park and trail opportunities within a 10-minute walk of every resident; and WHEREAS, the current ordinance does not allow targeted acquisition which is critical to creating a park system that best serves our growing city; and WHEREAS, this Resolution will allow staff to proceed with identifying a qualified consultant using the City's professional selection process and a separate resolution will be presented to the City Council to approve a contract. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby expresses its intent to engage a consultant to perform a Park Impact Fee study. Page 1 Page 56 of 425 Alison Jumper Submitted By City of Fayetteville Staff Review Form 2023-650 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 3/29/2023 PARKS & RECREATION (520) Submitted Date Division / Department Action Recommendation: A resolution to approve engaging a consultant to perform a park impact fee study. Budget Impact: n/a n/a Account Number Fund n/a n/a Project Number Project Title Budgeted Item? Yes Total Amended Budget $ - Expenses (Actual+Encum) Available Budget $ Does item have a direct cost? No Item Cost $ Is a Budget Adjustment attached? No Budget Adjustment Remaining Budget Purchase Order Number: Change Order Number: Original Contract Number: Comments: Previous Ordinance or Resolution # Approval Date: V20221130 Page 57 of 425 (1) Parkland Dedication. Applicability. The requirements of this subsection shall apply to residential lot splits, subdivisions, large scale developments, planned zoning districts, large scale site improvement plans, and small scale site improvement plans; provided that these requirements shall not apply to a lot split or subdivision that does not create one (1) or more vacant lots on which a residential structure could be erected pursuant to the Unified Development Code. Residential Development. (a) Dedication or Fee -in -Lieu. When a proposed residential development does not provide an area or areas for a public park based on the Fayetteville Parks and Recreation Plan, the developer shall be required to make a reasonable dedication of land for public park facilities, or to make a reasonable equivalent contribution in lieu of dedication of land, such contribution to be used for the acquisition and development of park land that serves the subdivision or development. (b) Parks and Recreation Advisory Board. Prior to the submittal of a preliminary plat, large scale development plan, or large site improvement plan the developer shall submit to the Parks and Recreation Advisory Board a concept plat or plan. (c) Planning Commission. The developer and the Parks and Recreation Advisory Board shall make a joint recommendation to the Planning Commission as to the land dedication or contribution in lieu of dedication. In the event that they are unable to agree, the developer and advisory board shall make separate recommendations to the Planning Commission who shall determine the issue. (d) Decision. If the developer proposes to dedicate land for a public park after consultation with the Parks and Recreation Advisory Board which the Planning Commission determines is suitable for park purposes, the proposed dedication shall be accepted. Upon consent and consultation with the developer and the Parks and Recreation Advisory Board, a developer may dedicate a portion of the required park land dedication and make a contribution of money in lieu of land dedication for the remaining park land dedication requirement. With consent of the Parks and Recreation Advisory Board, this monetary contribution may be used to develop the park land in the development or elsewhere within the quadrant consistent with the Fayetteville Parks and Recreation Plan. (e) Page 58 of 425 Approval. The Planning Commission's decision must be incorporated into the developer's preliminary plat, large scale development, or large site improvement plan prior to plat or plan approval. (f) Dedication Ratios. Land shall be dedicated at a ratio of 0.023 acres of land for each single-family dwelling unit and 0.020 acres of land for each multi -family dwelling unit. (g) Fee -in -Lieu formulas. A contribution in lieu of land dedication shall be made according to the following formula: $1,089.00 for each single-family unit. $952.00 for each multi -family unit based upon actual density. The Parks and Recreation Department shall review the contribution formula every two (2) years and make recommendations to the City Council following such review. (h) Dedication in Excess. If a developer wishes to dedicate park land which exceeds the requirement of this subsection, the developer shall make a written request to the Planning Commission who may grant the developer a credit equivalent to said excess. Said credit shall be applied toward the developer's obligation under this subsection for any subsequent development located in the same park quadrant. (iii) Timing of Dedication and/or Contribution. All dedications of land must be made before the city signs the final plat, or issuance of building permits for a large scale development or large site improvement plan. A final plat shall not be released for recordation until the deed for a land dedication is received. Deeded land is dedicated public park land and not subject to any right of reversion or refund. A cash contribution in lieu of required land development shall be payable before the city signing the final plat, or issuance of building permits for a large scale development or large site improvement plan. With the approval of the planning commission a developer may pay such contribution in three (3) equal installments to be paid in full within one (1) year of final plat approval. If a developer makes a cash contribution in lieu of land dedication, the developer shall be entitled to a pro rata refund, together with the accrued interest therefrom, in the event actual density is less than the density used as the basis for the developer's contribution; provided, no refund shall be made unless application therefore is made in writing to the Zoning and Development Administrator within one (1) year from the date of final plat approval. In the event actual density is more than the density used as the basis for a dedication of land or case contribution the developer must make an additional land dedication or contribution in lieu of dedication. (iv) Zoning Requirements. Lots created for the purpose of park land dedication shall not be required to meet the standards for lot size, bulk and area within any zoning district. Lots created for the purpose of park Page 59 of 425 land dedication to serve the residents of the surrounding area shall not be subject to POA/HOA dues or other fees established for maintenance or other purposes within the neighborhood. (v) Fee -in -Lieu Allocation. All parkland fees received under this subsection shall be deposited in an interest bearing account. This money together with its earned interest shall be expended within five (5) calendar years of the last date of the calendar year in which it was received for the acquisition and/or development of parkland that services the subdivision or development for which the contribution in lieu of dedication was made. If this money has not been expended within the allowed period, the unexpended money together with any of its remaining earned interest shall be refunded to the present owner of the property that was the subject of the new development and against which the parkland fee was assessed and collected. Page 60 of 425 CITY OF Pow, FAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff Jonathan Curth, Development Services Director Jessica Masters, Development Review Manager FROM: Donna Wonsower, Planner DATE: CITY COUNCIL MEMO 2023-502 SUBJECT: RZN-2023-0004: Rezoning (2910 N. OLD WIRE RD. / VAN SCYOC, 255): Submitted by JORGENSEN AND ASSOCIATES for property located at 2910 N Old Wire Rd in WARD 3. The property is zoned RSF-4, RESIDENTIAL SINGLE-FAMILY, FOUR UNITS PER ACRE and R-A, RESIDENTIAL AGRICULTURE, contains approximately 14.70 acres. The request is to rezone the property to R-A, RESIDENTIAL AGRICULTURE on 5.75 acres and NC, NEIGHBORHOOD CONSERVATION on 9.54 acres. RECOMMENDATION: City Planning staff and the Planning Commission recommend approval of a request to rezone the subject property as described and shown in the attached Exhibits `A' and `B'. BACKGROUND: The subject property is located in east Fayetteville, roughly 700 feet west of the intersection of N Crossover Rd. and N Old Wire Rd. The property's zoning is currently split between RSF-4, Residential Single -Family, Four (4) Units per Acre on the western half and R-A, Residential Agriculture on the eastern half. Except for a one single family house, the three parcels (cumulatively 14.7 acres) are undeveloped. The entire property is covered with extensive tree canopy. The eastern half is part of the streamside protection zone / floodplain & floodway of Niokaska Creek and is largely designated as part of the Enduring Green Network. Request: The request is to shift the alignment of the existing R-A, Residential Agriculture zoning district to follow the boundary of the 100-year flood line, and to rezone the remainder of the property to NC, Neighborhood Conservation. Public Comment: Five (5) members of the public offered comments in opposition of the item via email. Among their concerns were the potential increase in traffic, environmental concerns, negative impact on home values and neighborhood character, and lacking existing infrastructure including schools. One (1) member of the public emailed in support of the project. Additional members of the public spoke in person at the meeting, a summary of which is included below. Land Use Compatibility: Staff finds the request to be compatible with the surrounding context. Residential uses and densities located near the subject property vary substantially. Neighboring properties are of a variety of sizes but generally follow a cul-de-sac development pattern. The existing and proposed zoning districts have Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 61 of 425 similar allowable uses, but the NC includes urban form setbacks rather than traditional setbacks. When compared to RSF-4, rezoning to NC will decrease the lot area minimum for single and two-family uses from 8,000 and 12,000 square feet respectively to 4,000 sf. In addition, NC would have a build -to zone of 25 feet rather than a front setback of 15 feet, and a rear setback of 5 feet rather than 15 feet. NC requires a 40-foot lot width minimum while RSF-4 requires a 70-foot lot width minimum for single-family dwellings and an 80-foot lot width minimum for two-family dwellings. Conversely, both NC and RSF-4 include up to a three-story height limit. Since the subject property contains roughly 8.14 acres of RSF-4, a maximum of thirty-two (32) units are permitted under current entitlements, where the proposed rezoning to 9.54 acres of NC would increase the density cap to ninety-five (95) units. That said, any future development would be subject to, and limited by, minimum parking requirements, tree preservation, drainage, and access management standards. Land Use Plan Analysis: Staff finds the proposal is consistent with the goals in City Plan 2040 and the future land use designation for this location. Rezoning from RSF-4 to NC serves to contribute towards City Plan 2040 Goal #1— Appropriate Infill; #4— Growing a Livable Transportation Network, #5— We Will Assemble an Enduring Green Network, and #6— Create Opportunities for Attainable Housing. The site scores moderately on the Infill Scoring Matrix due to water/sewer access, public parks and trails, and the proximity of fire station #5. The RSF-4 and NC have similar allowed uses. However, because of the flexible zoning regulations associated with the NC district, rezoning may allow for redevelopment or added density while maintaining more tree canopy and natural areas than would be possible under the more Euclidean RSF-4 zoning district. CITY PLAN 2040 INFILL MATRIX: City Plan 2040's Infill Matrix indicates 5 attributes for this site that may contribute to appropriate infill. The following elements of the matrix contribute to the score: • Adequate Fire Response (Station #5, 2979 N Old Wire Rd.) • Near Sewer Main (8" sewer main, N Old Wire Rd.) • Near Water Main (6" water main, N Old Wire Rd.) • Near City Park (Gulley Park) • Near Paved Trail (Niokaska Creek Trail) DISCUSSION: At the February 27, 2023 Planning Commission meeting, a vote of 5-2-1 forwarded the request to City Council with a recommendation of approval. Commissioner Brink made the motion and Commissioner McGetrick seconded. Commissioner Holcomb recused himself for this item. Commissioners in favor of the rezoning found the intent of Neighborhood Conservation to be compatible with RSF-4, allowing for more flexible, walkable development. They also noted that although the property is not directly located in an urban growth center on the 2040 plan's growth concept map (designated on a scale of 1-3 depending on intensity), it is between a tier 2 and a tier 3 center on a high -activity corridor. Per the plan, the tier centers identify key growth nodes and major areas that should be conserved for natural resources and open space (City Plan 2040, pg. 12). The commissioners voting in favor of the rezoning also cited the logical re -alignment of the R-A zoning with the floodplain. Commissioners Garlock and Madden voted no citing a low infill score, limited possibility for connectivity to surrounding properties, and the property not falling within the bounds of the tier 2 center, and misalignment with the future land use map and master street plan regional link. Seven (7) members of the public spoke during the meeting. Discussion from the public focused primarily on compatibility with the existing neighborhood, drainage and flooding, density, increased traffic, environmental impact, insufficient schools, and the public hearing process. Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 62 of 425 BUDGET/STAFF IMPACT: NA ATTACHMENTS: SRF, Exhibit A, Exhibit B, Planning Commission Staff Report, RZN-2023-0004 CC Accident Data Memo w-attachments, Rezone 15 Acres at 2910 Old Wire Road, Updated 04132023 RZN-2023-0004 Contours and Streamside, RZN-2023-0004 Hydric Soils Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 63 of 425 ® City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Legislation Text File #: 2023-502 RZN-2023-0004: Rezoning (2910 N. OLD WIRE RD. / VAN SCYOC, 255): Submitted by JORGENSEN AND ASSOCIATES for property located at 2910 N Old Wire Rd in WARD 3. The property is zoned RSF-4, RESIDENTIAL SINGLE-FAMILY, FOUR UNITS PER ACRE and R- A, RESIDENTIAL AGRICULTURE, contains approximately 14.70 acres. The request is to rezone the property to R-A, RESIDENTIAL AGRICULTURE on 5.75 acres and NC, NEIGHBORHOOD CONSERVATION on 9.54 acres. AN ORDINANCE TO REZONE THAT PROPERTY DESCRIBED IN REZONING PETITION RZN 23-004 LOCATED AT 2910 NORTH OLD WIRE ROAD IN WARD 3 FOR APPROXIMATELY 14.70 ACRES FROM RSF-4, RESIDENTIAL SINGLE-FAMILY, 4 UNITS PER ACRE AND R-A, RESIDENTIAL AGRICULTURE TO R-A, RESIDENTIAL AGRICULTURE AND NC, NEIGHBORHOOD CONSERVATION BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby changes the zone classification of the property shown on the map (Exhibit A) and the legal description (Exhibit B) both attached to the Planning Department's Agenda Memo from RSF-4, Residential Single -Family, 4 Units Per Acre and R-A, Residential Agriculture to R-A, Residential Agriculture and NC, Neighborhood Conservation. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby amends the official zoning map of the City of Fayetteville to reflect the zoning change provided in Section 1. Page 1 Page 64 of 425 Jonathan Curth Submitted By City of Fayetteville Staff Review Form 2023-502 Item ID 3/21/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 2/27/2023 DEVELOPMENT REVIEW (630) Submitted Date Division / Department Action Recommendation: RZN-2023-0004: Rezoning (2910 N. OLD WIRE RD. / VAN SCYOC, 255): Submitted by JORGENSEN AND ASSOCIATES for property located at 2910 N Old Wire Rd in WARD 3 . The property is zoned RSF-4, RESIDENTIAL SINGLE-FAMILY, FOUR UNITS PER ACRE and R-A, RESIDENTIAL AGRICULTURE, contains approximately 14.70 acres. The request is to rezone the property to R-A, RESIDENTIAL AGRICULTURE on 5.75 acres and NC, NEIGHBORHOOD CONSERVATION on 9.54 acres. Budget Impact: Account Number Fund Project Number Project Title Budgeted Item? No Total Amended Budget $ - Expenses (Actual+Encum) $ - Available Budget Does item have a direct cost? No Item Cost $ - Is a Budget Adjustment attached? No Budget Adjustment $ - Remaining Budget Purchase Order Number: Change Order Number: Original Contract Number: Comments: V20221130 Previous Ordinance or Resolution # Approval Date: Page 65 of 425 RZN-2023-0004 2910 N OLD WIRE RD Close Up View "Olp R� 00) —STRAWBE ' Greek - ya eGtia< � . - �m j NORTH Zone Current Proposed Regional Link Neighborhood Link NC 0.0 9.5 P-1 0.0 0.0 Residential Link R-A 6.8 5.7 Feet RSF-4 7.5 0.0 Trail (Proposed) r ' Planning Area 0 75 150 300 450 600 Fayetteville City Limits 1 :2,400 Total 15.2 ac Page 66 of 425 RZN-2023-0004 EXHIBIT "B" PROPOSED NC: A PART OF THE FRACTIONAL SOUTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 31, TOWNSHIP 17 NORTH, RANGE 29 WEST, A PART OF THE SOUTHEAST QUARTER OF THE NORTHEAST QUARTER AND A PART OF THE NORTHEAST QUARTER OF THE SOUTHEAST QUARTER, BOTH BEING IN SECTION 36, TOWNSHIP 17 NORTH, RANGE 30 WEST, WASHINGTON COUNTY, ARKANSAS, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWEST CORNER OF THE SAID FRACTIONAL SOUTHWEST QUARTER OF THE NORTHWEST QUARTER, AND RUNNING 502°14'17"W 97.12 FEET TO THE TRUE POINT OF BEGINNING, SAI❑ POINT ALSO BEING LOCATED ON THE SOUTHERN RIGHT OF WAY OF NORTH OLD WIRE ROAD, AND RUNNING THENCE S42°15'49"W 429.56 FEET; THENCE S87°52'31"E 123.32 FEET; THENCE S08°33'31"W 53.99 FEET; THENCE SOS°31'45"W 57.41 FEET; THENCE S24°32'37"W 24.30 FEET, THENCE S24°54'10"W 53.06 FEET; THENCE S32°19'52"W 81.60 FEET; THENCE S22°31'13"W 31.24 FEET; THENCE S30°56'30"W 55.84 FEET; THENCE S67°02'26"W 19.68 FEET; THENCE S46°06'51"W 27.99 FEET; THENCE S33'54'04"W 31.67 FEET; THENCE S24°14'51"W 66.12 FEET; THENCE S50'36'17"W 30.08 FEET; THENCE S22°18'47"W 24.79 FEET; THENCE S08°12'04"W 45.76 FEET; THENCE S26°45'39"W 32.36 FEET; THENCE S51°35'25"W 9.85 FEET; THENCE S51°35'41"W 8.83 FEET; THENCE S24°30'55"W 20.93 FEET; THENCE S03°58'37"W 40.38 FEET; THENCE S19°01'59"W 20.25 FEET; THENCE S14°09'59"W 60.86 FEET; THENCE S09°28'53"W 18.99 FEET; THENCE S35°51'49"W 15.43 FEET, THENCE S50°39'06"W 4.53 FEET; THENCE N35°50'03"W 327.54 FEET; THENCE N35°16'57"W 400.46 FEETTO THE SOUTHERN RIGHT OF WAY OF NORTH OLD WIRE ROAD, AND RUNNING ALONG SAID RIGHT OF WAY THE FOLLOWING 5 COURSES: ALONG A CURVE TURNING TO THE LEFT, HAVING A RADIUS OF 2397.52 FEET, AND WHOSE LONG CHORD BEARS N40°57'49"E 147.18 FEET; ALONG A CURVE TURNING TO THE RIGHT, HAVING A RADIUS OF 3286.14 FEET, AND WHOSE LONG CHORD BEARS N41°51'51"E 218.96 FEET; ALONG A CURVE TURNING TO THE RIGHT, HAVING A RADIUS OF 1347.97 FEET, AND WHOSE LONG CHORD BEARS N48-18'14"E 205.46 FEET; ALONG A CURVE TURNING TO THE RIGHT, HAVING A RADIUS OF 1689.10 FEET, AND WHOSE LONG CHORD BEARS N55°03'18"E 261.36 FEET; ALONG A CURVE TURNING TO THE RIGHT, HAVING A RADIUS OF 573.12 FEET, AND WHOSE LONG CHORD BEARS N61-16'48"E 42.19 FEET TO THE POINT OF BEGINNING, CONTAINING IN ALL 9.785 ACRES, MORE OR LESS. PROPOSED R-A: A PART OF THE FRACTIONAL SOUTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 31, TOWNSHIP 17 NORTH, RANGE 29 WEST, A PART OF THE SOUTHEAST QUARTER OF THE NORTHEAST QUARTER AND A PART OF THE NORTHEAST QUARTER OF THE SOUTHEAST QUARTER, BOTH BEING IN SECTION 36, TOWNSHIP 17 NORTH, RANGE 30 WEST, WASHINGTON COUNTY, ARKANSAS, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWEST CORNER OF THE SAID FRACTIONAL SOUTHWEST QUARTER OF THE NORTHWEST QUARTER, AND RUNNING 502°14'17"W 97.12 FEET; 502°15'49"W 429.56 FEET; and S87°52'31"E 123.32 FEET TO THE TRUE POINT OF BEGINNING, and running THENCE S87°52'31"E 409.20 FEET TO THE WESTERN RIGHT OF WAY OF NORTH CROSSOVER ROAD, AND RUNNING ALONG SAI❑ RIGHT OF WAY THE FOLLOWING 3 COURSES: S30°12'22"W 234.20 FEET; 525°57'22"W 107.26 FEET; S21°46'26"W 105.67 FEET; THENCE LEAVING SAI❑ RIGHT OF WAY 558'02'23"W 336.11 FEET; THENCE N84°10'57"W 40.00 FEET; THENCE S22°05'53"W 306.47 FEET; THENCE N35°50'03"W 160.87 FEET; THENCE N50°39'06"E 4.53 FEET; THENCE N35°51'49"E 15.43 FEET; THENCE N09°28'53"E 18.99 FEET; THENCE N14°D9'59"E 60.86 FEET; THENCE N19*01'59"E 20.25 FEET; THENCE ND3'58'37"E 40.38 FEET; THENCE N24°30'55"E 20.93 FEET; THENCE N51°35'41"E 8.83 FEET; THENCE N51°35'25"E 9.85 FEET; THENCE N26°45'39"E 32.36 FEET; THENCE N08°12'04"E 45.76 FEET; THENCE N22°18'47"E 24.79 FEET; THENCE N50°36'17"E 30.08 FEET; THENCE N24'14'51"E 66.12 FEET; THENCE N33°54'04"E 31.67 FEET; THENCE N46°06'51"E 27.99 FEET; THENCE N67'02'26"E 19.68 FEET; THENCE N30°56'30"E 55.84 FEET; THENCE N22°31'13"E 31.24 FEET; THENCE N32°19'52"E 81.60 FEET; THENCE N24'54'10"E 53.06 FEET; THENCE N24°32'37"E 24.30 FEET; THENCE N05'31'45"E 57.41 FEET; THENCE N08°33'31"E 53.99 FEETTO THE POINT OF BEGINNING, CONTAINING IN ALL 5.497 ACRES, MORE OR LESS. SUBJECT TO EASEMENTS AND RIGHTS OF WAY OF RECORD. Page 67 of 425 CITY OF i FAYETTEVILLE ARKANSAS PLANNING COMMISSION MEMO TO: Fayetteville Planning Commission THRU: Jessie Masters, Development Review Manager FROM: Donna Wonsower, Planner MEETING DATE: February 27, 2023 (Updated with results from Planning Commission) SUBJECT: RZN-2023-0004: Rezoning (2910 N. OLD WIRE RD. / VAN SCYOC, 255): Submitted by JORGENSEN AND ASSOCIATES for property located at 2910 N Old Wire Rd. The property is zoned RSF-4, RESIDENTIAL SINGLE-FAMILY, FOUR UNITS PER ACRE and R-A, RESIDENTIAL AGRICULTURAL, contains approximately 14.70 acres. The request is to rezone the property to R-A, RESIDENTIAL AGRICULTURAL on 5.75 acres and NC, NEIGHBORHOOD CONSERVATION on 9.54 acres. RECOMMENDATION: Staff recommends forwarding RZN-2023-0004 to City Council with a recommendation of approval. RECOMMENDED MOTION: "I move to forward RZN-2023-0004 to City Council with a recommendation of approval." BACKGROUND: The subject property is in east Fayetteville, roughly 700 feet west of the intersection of N. Crossover Rd. and N. Old Wire Rd. The property's zoning is currently split roughly half between RSF-4, Residential Single -Family, Four (4) Units per Acre on the western half and R-A, Residential Agricultural over the eastern half. Except for a single -single family house, the three parcels (cumulatively 14.7 acres) are undeveloped. The entire property is covered extensively with tree canopy and the eastern half is part of the streamside protection zone / floodplain & floodway of Niokaska Creek. Most of the land currently zoned R-A is designated as part of the Enduring Green Network. Surrounding land uses and zoning is depicted in Table 1. Table 1 Surrounding Land Use and Zoning Direction Land Use Zoning North Single -Family Residential RSF-4, Residential Single -Family, 4 Units per Acre South Streamside / Single -Family Residential RSF-4, Residential Single -Family, 4 Units per Acre / R-A, Residential Agricultural East Single -Family Residential RSF-4, Residential Single -Family, 4 Units per Acre West Single -Family Residential RSF-4, Residential Single -Family, 4 Units per Acre Planning Commission February 27, 2023 RZN-2023-0004 (VAN SCYe"e 68 of 425 Paqe 1 of 20 Request: The request is to shift the alignment of the existing R-A, Residential Agricultural zoning district to follow the boundary of the 100-year flood line, and to rezone the remainder of the property to NC, Neighborhood Conservation. Public Comment: Two members of the public offered comment in opposition of the item. Among their concerns was the potential increase in traffic, environmental concerns, negative impact to home values and neighborhood character, and lacking existing infrastructure including schools. INFRASTRUCTURE AND ENVIRONMENTAL REVIEW Streets: The subject area has frontage along N. Old Wire Rd., a partially improved Neighborhood Link street with asphalt paving, and open ditches. The subject area also has frontage along N. Sumac Dr., a fully improved residential link street with asphalt paving, sidewalk, gutter and curb. Any street improvements required in these areas would be determined at the time of development proposal. Any additional improvements or requirements for drainage will be determined at time of development. Water: Public water is available to the subject area. Existing 8-inch water main is present on the south side of N. Old Wire Rd. Existing 6-inch water main is present on the north side of N. Sumac Dr. Sewer: Sanitary Sewer is available to the Subject area. Existing 6-inch sewer main is present on the North side of N. Old Wire Rd. Fire: Station 5, located at 2979 N. Crossover Rd., protects this site. The property is located approximately 0.5 miles from the fire station with an anticipated drive time of approximately 1 minute using existing streets. The anticipated response time would be approximately 3.2 minutes. Fire Department response time is calculated based on the drive time plus 1 minute for dispatch and 1.2 minutes for turn -out time. Within the City Limits, the Fayetteville Fire Department has a response time goal of 6 minutes for an engine and 8 minutes for a ladder truck. Police: The Police Department expressed no concerns with this request. Drainage: No portion of the property lies within the Hillside -Hilltop Overlay District. A portion of the property is designated as having hydric soils, a known indicator of wetlands. However, for an area to be classified as wetlands, it may also need other characteristics such as hydrophytes (plants that grow in water), and shallow water during parts of the year. Hydric Soils can be found across many areas of Fayetteville, including valleys, floodplains, and open prairies. It's important to identify these natural resources during development, so when these soils are identified on a property, further environmental studies will be required at the time of development. Before permits will be issued for the property a statement/report from an environmental professional must be provided summarizing the existence of wetlands on the property. If this statement/report indicates that wetlands may be present on site, a USACE Determination of Jurisdictional Wetlands will be required at the time of development submittal. A portion of the property lies within a FEMA floodplain. A floodplain development Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 69 of 425 Page 2 of 20 review will be required at the time of permit or plan submittal. This will restrict the type of development and impact in flood zones; and may require additional documentation such as flood studies or elevation certificates depending on the type of development. If a development impacts a floodplain, those impacts may require review and approval from FEMA. A portion of the property lies within a streamside protection zone. Streamside Protection Zones generally consists of a protected area on each side of a stream or creek. This "protected area" is meant to preserve woody vegetation and natural areas along stream corridors to improve/protect stream health. At a minimum, it will be 50ft wide as measured from the top of bank but depending on the shape and extents of the floodway, it could be substantially more. Certain construction activities such as trails and some utilities are allowed in these zones, but in general, improvements such as parking lots or buildings are prohibited. Tree Preservation: The proposed zoning district of NC, Neighborhood Conservation requires 20% minimum canopy preservation. The zoning district of RA, Residential Agricultural, intended to be re -aligned but not removed, requires 25% minimum canopy preservation. The current zoning district of RSF-4, Residential Single - Family, Four Units Per Acre requires 25% minimum canopy preservation. CITY PLAN 2040 FUTURE LAND USE PLAN: City Plan 2040 Future Land Use Plan designates the property within the proposed rezone as a Residential Neighborhood and Natural Area. Residential Neighborhood Areas are primarily residential in nature and support a wide variety of housing types of appropriate scale and context: single-family, duplexes, rowhouses, multifamily and accessory dwelling units. Residential Neighborhood encourages highly connected, compact blocks with gridded street patterns and reduced building setbacks. It also encourages traditional neighborhood development that incorporates low -intensity non-residential uses intended to serve the surrounding neighborhoods, such as retail and offices, on corners and along connecting corridors. This designation recognizes existing conventional subdivision developments which may have large blocks with conventional setbacks and development patterns that respond to features of the natural environment. Building setbacks may vary depending on the context of the existing neighborhood. Natural Areas consist of lands approximating or reverting to a wilderness conditions, including those with limited development potential due to topography, hydrology, vegetation or value as an environmental resource. These resources can include stream and wildlife corridors, as well as natural hubs and cores, many of which are identified in the generalized enduring green network. A Natural Area designation would encourage a development pattern that requires conservation and preservation, prevents degradation of these areas, and would utilize the principles of low impact development stormwater infrastructure for all developments. Natural Areas are prime candidates for conservation subdivision design and/or clustered development patterns. CITY PLAN 2040 INFILL MATRIX: City Plan 2040's Infill Matrix indicates a score of 6 for this site, with a weighted score of 6 at the highest. The following elements of the matrix contribute to the score: • Adequate Fire Response (Station #5, 2979 N Old Wire Rd.) • Near Sewer Main (8" sewer main, N Old Wire Rd.) • Near Water Main (6" water main, N Old Wire Rd.) Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 70 of 425 Page 3 of 20 • Near City Park (Gulley Park) • Near Paved Trail (Niokaska Creek Trail) FINDINGS OF THE STAFF A determination of the degree to which the proposed zoning is consistent with land use planning objectives, principles, and policies and with land use and zoning plans. Finding: Land Use Compatibility: Staff finds the request to be compatible with the surrounding context. Residential uses and densities located near the subject property vary substantially. Neighboring properties are of a variety of sizes but generally follow a cul-de-sac development pattern. The existing and proposed zoning districts have similar allowable uses, the NC includes urban form setbacks rather than traditional setbacks. When compared to RSF-4, rezoning to NC will decrease the buildable area of the lot for single and two-family uses from 8,000 and 12,000 square feet respectively to 4,000 square feet. In addition, NC would have a build -to zone of 25 feet rather than a front setback of 15 feet, and a rear setback of 12 feet rather than 15 feet. Since the subject property contains roughly 8.14 acres of RSF-4, a maximum of thirty-two (32) units are permitted under current entitlements, where the proposed rezoning to 9.54 acres of NC would increaser the density cap to ninety-five (95) units. That said, any future development would be subject to, and limited by, minimum parking requirements, tree preservation, drainage, and access management standards. NC requires a 40-foot lot width minimum while RSF-4 requires a 70-foot lot width minimum for single-family dwellings and 80-ft lot width minimum for two-family dwellings. Conversely, both NC and RSF-4 include up to a three-story height limit. Land Use Plan Analysis: Staff finds the proposal is consistent with the goals in City Plan 2040 and the future land use designation for this location. Rezoning from RSF-4 to NC serves to contribute towards City Plan 2040 Goals #1 — Appropriate Infill, Growing a Livable Transportation Network, #5 - We Will Assemble an Enduring Green Network, and #6 — Create Opportunities for Attainable Housing. The site scores moderately on the Infill Scoring Matrix due to water/sewer access, public parks and trails, and the proximity of fire station #5. The RSF-4 and NC have similar allowed uses; however because of the form -based zoning regulations associated with the NC district, rezoning may allow for redevelopment or added density while maintaining more tree canopy and natural areas than would be possible under the RSF-4 zoning district. The Future Land Use Map designates the site as split between Residential Neighborhood Area, which supports "a wide variety of housing types of appropriate scale and context including single-family, duplexes, rowhouses, multifamily and accessory dwelling units," and Natural Area, which "promotes conservation of open space and areas of significant riparian benefit." Staff is supportive of realigning the R-A zoning district to the 100- year flood boundary, as the change would more accurately reflect the intent of the future land use plan to preserve the riparian area adjacent to Niokaska Creek. Further, adding density as designated by the "Residential Neighborhood" designation is likely best facilitated by the regulations in NC Planning Commission February 27, 2023 RZN-2023-0004 (VAN sCYe"e 71 of 425 Page 4 of 20 zoning and is justified given the property's proximity to commercial and non- residential uses in north Fayetteville. 2. A determination of whether the proposed zoning is justified and/or needed at the time the rezoning is proposed. Finding: Staff finds that a rezoning to NC is justified. Rezoning may be less restrictive in allowing the property to develop under proportional regulations. Because rezoning will better support infill redevelopment on the property, staff finds the proposed zoning to be consistent with the City's future land use goals and therefore needed at this time. 3. A determination as to whether the proposed zoning would create or appreciably increase traffic danger and congestion. Finding: Rezoning to NC has an associated potential to increase traffic at this location. NC permits development at 10 units per acre where it is currently limited to 4 units per acre. Staff finds potential to increase the number of residential units above what is currently allowed by right; subject to constraints such as steep slopes, tree preservation requirements, and other design requirements. Staff finds the increase in density is unlikely to result in increased traffic danger or congestion. The subject property has access to N. Old Wire Rd., an improved Neighborhood Link. Future development would be required to meet the City's applicable access management and parking standards. 4. A determination as to whether the proposed zoning would alter the population density and thereby undesirably increase the load on public services including schools, water, and sewer facilities. Finding: Rezoning the property to NC may increase the load on public services, but the impact is not expected to be detrimental. The size of the property and access to existing water and sewer infrastructure means future development will likely avoid the need for costly extensions to services. Fayetteville Public Schools did not comment on this request. 5. If there are reasons why the proposed zoning should not be approved in view of considerations under b (1) through (4) above, a determination as to whether the proposed zoning is justified and/or necessitated by peculiar circumstances such as: a. It would be impractical to use the land for any of the uses permitted under its existing zoning classifications; b. There are extenuating circumstances which justify the rezoning even though there are reasons under b (1) through (4) above why the proposed zoning is not desirable. Finding: N/A RECOMMENDATION: Planning staff recommends forwarding RZN-2023-0004 to City Council with a recommendation of approval. Planning Commission February 27, 2023 RZN-2023-0004 (VAN sCYe"e 72 of 425 Paqe 5 of 20 PLANNING COMMISSION ACTION: Required YES Date: February 27, 2023 O Tabled O Forwarded O Denied Forwarded with a recommendation of approval Motion: Brink Seven (7) Public comment in person, Six (6) Digital comments Second: McGetrick jVOte: 5-2-1 (Garlock & Madden voted No, Holcomb Recused) BUDGET/STAFF IMPACT: None Attachments: • Unified Development Code: o §161.03 District R-A, Residential Agricultural o §161.07 District RSF-4, Residential Single -Family, Four Units per Acre o §161.29 District NC, Neighborhood Conservation • Applicant Request Letter • Public Comment • One Mile Map • Close-up Map • Current Land Use Map • Future Land Use Map Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 73 of 425 Page 6 of 20 161.03 District R-A, Residential -Agricultural (A) Purposes. The regulations of the agricultural district are designed to protect agricultural land until an orderly transition to urban development has been accomplished; prevent wasteful scattering of development in rural areas; obtain economy of public funds in the providing of public improvements and services of orderly growth; conserve the tax base; provide opportunity for affordable housing, increase scenic attractiveness; and conserve open space. (B) Uses. (1) Permitted Uses. Unit 1 City-wide uses by right Unit 3 Public protection and utility facilities Unit 6 Agriculture Unit 7 Animal husbandry Unit 8 Single-family dwellings Unit 9 Two-family dwellings Unit 37 Manufactured homes Unit 41 Accessory dwellings Unit 43 Animal boarding and training Unit 46 Short-term rentals (2) Conditional Uses. Unit 2 City-wide uses by conditional use permit Unit 4 Cultural and recreational facilities Unit 5 Government facilities Unit 20 Commercial recreation, large sites Unit 24 Home occupations Unit 35 Outdoor Music Establishments Unit 36 Wireless communications facilities Unit 42 Clean technologies (C) Density. Units per acre I One-half '/2 (D) Bulk and Area Regulations. Lot width minimum 200 feet Lot Area Minimum: Residential: 2 acres Nonresidential: 2 acres Lot area per dwelling unit 2 acres (E) Setback Requirements. Front Side Rear 35 feet 20 feet 35 feet (F) Height Requirements. There shall be no maximum height limits in the R-A District, provided, however, if a building exceeds the height of one (1) story, the portion of the building over one (1) Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 74 of 425 Page 7 of 20 story shall have an additional setback from any boundary line of an adjacent residential district. The amount of additional setback for the portion of the building over one (1) story shall be equal to the difference between the total height of that portion of the building and one (1) story. (G) Building area. None. (Code 1965, App. A., Art. 5(1); Ord. No. 1747, 6-29-70; Code 1991, §160.030; Ord. No. 4100, §2 (Ex. A), 6-16-98; Ord. No. 4178, 8-31-99; Ord. No. 5028, 6-19-07; Ord. No. 5128, 4-15-08; Ord. No. 5195, 11-6- 08; Ord. No. 5238, 5-5-09; Ord. No. 5479, 2-7-12; Ord. No. 5945, §3, 1-17-17; Ord. No. 6015, §1(Exh. A), 11-21-17; Ord. No. 6427 , §§1(Exh. C), 2, 4-20-2 1) Ord. No. 6427 , § 2, adopted April 20, 2021, "determines that this ordinance and all amendments to Code sections ordained or enacted by this ordinance shall automatically sunset, be repealed, terminated, and become void twenty (20) months after the passage and approval of this ordinance, unless prior to that date, the City Council amends this ordinance to repeal this sunset, repeal and termination section." 161.07 District RSF-4, Residential Single -Family - Four (4) Units Per Acre (A) Purpose. The RSF-4 Residential District is designed to permit and encourage the development of low -density detached dwellings in suitable environments, as well as to protect existing development of these types. (B) Uses. (1) Permitted Uses. Unit 1 City-wide uses by right Unit 8 Single-family dwellings Unit 41 Accessory dwellings Unit 46 Short-term rentals (2) Conditional Uses. Unit 2 City-wide uses by conditional use permit Unit 3 Public protection and utility facilities Unit 4 Cultural and recreational facilities Unit 5 Government facilities Unit 9 Two-family dwellings Unit 12a Limited business Unit 24 Home occupations Unit 36 Wireless communications facilities Unit 44 Cluster Housing Development (C) Density. Single-family dwellings Two (2) family dwellings Units per acre 4 or less 7 or less (D) Bulk and Area Regulations. Single-family dwellings Two (2) family dwellings Lot minimum width 70 feet 80 feet Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 75 of 425 Page 8 of 20 Lot area minimum 8,000 square feet 12,000 square feet Land area per 8,000 square feet 6,000 square feet dwelling unit Hillside Overlay 60 feet 70 feet District Lot minimum width Hillside Overlay 81000 square feet 12,000 square feet District Lot area minimum Land area per 8,000 square feet 6,000 square feet dwelling unit (E) Setback Requirements. Front Side Rear 15 feet 5 feet 15 feet (F) Building Height Regulations. Building Height Maximum 13 stories (G) Building Area. On any lot the area occupied by all buildings shall not exceed 40% of the total area of such lot. Accessory ground mounted solar energy systems shall not be considered buildings. (Code 1991, §160.031; Ord. No. 4100, §2 (Ex. A), 6-16-98; Ord. No. 4178, 8-31-99; Ord. No. 4858, 4-18- 06; Ord. No. 5028, 6-19-07; Ord. No. 5128, 4-15-08; Ord. No. 5224, 3-3-09; Ord. No. 5312, 4-20-10; Ord. No. 5462, 12-6-11; Ord. No. 5921 , §1, 11-1-16; Ord. No. 5945 , §8, 1-17-17; Ord. No. 6015 , §1(Exh. A), 11-21-17; Ord. No. 6245 , §2, 10-15-19; Ord. No. 6427 , §§l(Exh. C), 2, 4-20-21) Ord. No. 6427 , § 2, adopted April 20, 2021, "determines that this ordinance and all amendments to Code sections ordained or enacted by this ordinance shall automatically sunset, be repealed, terminated, and become void twenty (20) months after the passage and approval of this ordinance, unless prior to that date, the City Council amends this ordinance to repeal this sunset, repeal and termination section." 161.29 Neighborhood Conservation (A) Purpose. The Neighborhood Conservation zone has the least activity and a lower density than the other zones. Although Neighborhood Conservation is the most purely residential zone, it can have some mix of uses, such as civic buildings. Neighborhood Conservation serves to promote and protect neighborhood character. For the purposes of Chapter 96: Noise Control, the Neighborhood Conservation district is a residential zone. (B) Uses. (1) Permitted Uses. Unit 1 City-wide uses by right Unit 8 Single-family dwellings Unit 41 Accessory dwellings Unit 46 Short-term rentals Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 76 of 425 Page 9 of 20 (2) Conditional Uses. Unit 2 City-wide uses by conditional use permit Unit 3 Public protection and utility facilities Unit 4 Cultural and recreational facilities Unit 9 Two 2 family dwellings Unit 10 Three 3 and four 4 family dwellings Unit 12a Limited business* Unit 24 Home occupations Unit 25 Offices, studios, and related services Unit 28 Center for collecting recyclable materials Unit 36 Wireless communication facilities Unit 44 Cluster Housing Development (C) Density. Ten (10) Units Per Acre. (D) Bulk and Area Regulations. (1) Lot Width Minimum. All dwelling types 140 feet (2) Lot Area Minimum. 4,000 square feet (E) Setback Regulations. Front A build -to zone that is located between the front property line and a line 25 feet from the front property line. Side 5 feet Rear 5 feet Rear, from center line of 12 feet an alley (F) Building Height Regulations. Building Height Maximum 13 stories (Ord. No. 5128, 4-15-08; Ord. No. 5312, 4-20-10; Ord. No. 5462, 12-6-11; Ord. No. 5592, 6-18-13; Ord. No. 5664, 2-18-14; Ord. No. 5800, §1(Exh. A), 10-6-15>; Ord. No. 5921 , §1, 11-1-16; Ord. No. 5945, §§5, 7-9, 1-17-17; Ord. No. 6015, §1(Exh. A), 11-21-17; Ord. No. 6211 , §1, 8-6-19; Ord. No. 6427, §§1(Exh. C), 2, 4-20-21) Ord. No. 6427 , § 2, adopted April 20, 2021, "determines that this ordinance and all amendments to Code sections ordained or enacted by this ordinance shall automatically sunset, be repealed, terminated, and become void twenty (20) months after the passage and approval of this ordinance, unless prior to that date, the City Council amends this ordinance to repeal this sunset, repeal and termination section." Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 77 of 425 Page 10 of 20 $4 JORGENSEN +ASSOCIATES vCivil Engineering Surveying February 3, 2023 City of Fayetteville Development Services 113 West Mountain Street Fayetteville, AR 72701 Re: Rezoning at 2910 N Old Wire Road Dear City Staff; 124 W Sunbridge Drive, Suite 5 Fayetteville, AR 72703 Office: 479.442.9127 www orgerserassoc con, Established 1985 On Behalf of the Owner and their representatives, we are submitting a rezoning request for property located along 2910 N Old Wire, Fayetteville, AR 72703. A. The current owner of this site is as follows: Nola VanScyoc Revocable Trust (Parcel Numbers 765- 16047-000, 765-13287-000. 765-16043-000. B. Currently this property is zoned RSF-4 and R-A. C. This property is surrounded by RSF-4 on the north and west, a portion of P-1 to the south and north, and section of R-O to the east. D. Existing adequate water and sewer are already at this site. E. We feel the requested rezoning is in line with the goals of the City Plan 2040 where the future land use calls for a portion of Residential Neighborhood and Natural. Statement of Compatibility: This request to rezone a portion of the RSF-4 to Neighborhood Conservation and adjust the R-A zoning line to match the 100-year floodplain is compatible with neighboring property and will not unreasonably adversely affect or conflict with surrounding land uses. Within reasonable proximity, rezoning of the property south of Butterfield Elementary to NC, sets a precedence for similar development patterns that serve to promote and protect neighborhood character. The zoning line has been adjusted to follow the 100-year flood plain and this zoning line makes more sense than the current zoning line and will ensure that the floodplain would be of minimal impact. Given the proximity to the Fire Station, Crossover (Regional Link), and the Niokaska Trail, we feel that this rezoning is supported in a multitude of ways and will not adversely impact vehicular patterns. Planning Commission February 27, 2023 RZN-2023-0004 (VAN SC)8"e 78 of 425 Page 16 of 20 PUBLIC COMMENT: JULIE C KEYS Wonsower, Donna From: Julie C Keys <jckeys611 @gmail.com> Sent: Saturday, February 25, 2023 9:39 PM To: Wonsower, Donna Subject: Old Wire Rezoning CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear City Planner Wonsower: This concern addresses the rezoning of 2910 North Old Wire Road. I firmly believe that it is not in the best interest of its neighbors, commuters, or city of Fayetteville. First, I wish to address this issue on a personal note. In 2006, my husband and I began our search for a home in Fayetteville to raise our one year old and immediately fell in love with the property on Raintree Drive in the Boxwood subdivision. At the time, I worried that our proximity to the fire station was too close, potentially a noise nuisance, but I talked myself into that being a plus to the property. It was the green space behind our house that sold us! For the last 17 years, listening to the sounds and enjoying the sights of the wooded area have brought such peace. I also want to address this issue as a citizen of Fayetteville. The projected area on Old Wire Road currently has only two lanes, leading to numerous neighborhoods and to commercial areas. There is no sidewalk, and traffic is often backed up at the intersection of Old Wire Road and Crossover Road. Additional dwellings will impact an already congested area of town. Many times when I try to leave my street, I face lines of traffic or speeding cars. From a traffic perspective, adding more dwellings to the area will negatively impact the area. Most importantly though, I want to address the potential environmental concerns. One of the reasons I chose this area was the city's commitment to conserve green space and protect its natural beauty. Just four houses down from my house, homeowners are required to have flood insurance. Considering the city's recent restoration to Niokaska Creek, an area of the Illinois River Watershed, I worry about upsetting the landscape further. I am not a landscape engineer, but I do know that destroying the current tree canopy can lead to erosion. In addition, urban development influences drainage and contaminates water. These concerns do not seem to be in line with the City of Fayetteville's vision. Thank you for your service to our fine city, and I ask that additional consideration be given to the proposed area. Below you will find images of the proposed rezoning from my home, as well as data from the Fayetteville City Plan 2040. In appreciation, Julie Keys 2792 North Raintree Drive ickevs611 ra-)amail.com 479-957-1780 Page 79 of 425 0 0 0 8.3 Tree Canopy A healthy urban tree canopy can address the three major weather events that are anticipated to affect Northwest Arkansas: unpredictable but more impactful rain events, drought, and heat waves. Even before broad acknowledgement of climate change, Fayetteville and its residents placed a high value on the City's tree canopy, particularly with the formation of the Tree and Landscape Advisory Committee in 1993 and the subsequent adoption of a Tree Preservation ordinance regulating tree removal associated with development. 8.4 Slopes and Hillsides Slope is a critical factor in determining a soil's suitability for supporting development. The development of severe slopes involving soils not capable of provided sufficient foundational support may result in extensive cutting and filling to stabilize them. When compounded by the removal of existing vegetation, the excavation and fill of soil can result in severe erosion, slumping and shearing. In Fayetteville, areas of severe slope are characterized by soils less suitable for development. Shallow depth to bedrock conditions are compound problems in these areas. There are several identified beds of cherty limestone, acid sandstone, siltstone and shale that have shown faulting and folding at steeper locations. Of the 58,037 acres of land within the City and its Planning Area, approximately 16%, or 8,900 acres have slopes of 15 percent or greater. With some notable exceptions such as Mount Sequoyah, these slopes have previously remained largely undeveloped. More recent trends indicate that development on hillsides and hilltops is increasing. The passage of the Hillside/Hilltop Development Overlay District in 2006 provided additional development protections on slopes that are 15 percent and greater and the flatter, bench -like hilltops. 8.5 Watershed System However, urban development can, and has, altered many of these natural drainage systems which can create drainage, storage and flooding hazards during heavy or extended duration storm events. 8.6 Flooding In general Chapter 168, flood damage prevention, of the Unified Development Code (UDC) and 44 Code of Federal Regulations (44CFR) are utilized in conjunction with the latest Flood Insurance Rate Maps (FIRM) to determine which properties may be at risk and in need of additional regulation to limit flood losses. These regulations extend to the area defined as "Special Flood Hazard Areas" located on the Flood Insurance Rate Maps. Flooding also brings challenges associated with water quality. Rising flood waters can be contaminated by, among other things, oil and grease, household chemicals, fuels, sanitary sewer overflows, and soils/ sediment. One major contributor of soil/ sediment and the associated nutrients such as phosphorus is stream bank erosion. As flood waters rise, the velocity of the water increases and can damage stream banks causing both pollution issues and property loss. All of these items can damage the natural ecosystem and potentially harm drinking water sources. Beaver Lake is the drinking water source for all of Northwest Arkansas and approximately 40% of Fayetteville currently drains into this watershed. The remainder drains into the Illinois River Watershed which also has its challenges with regard to pollutants. Page 80 of 425 PUBLIC COMMENT: ROB KEYS Wonsower, Donna From: Rob Keys <2123keys@gmail.com> Sent: Sunday, February 26, 2023 6:22 PM To: Umberger, Ryan; Wonsower, Donna; Hopkins, Mirinda; Planning Shared Subject: development off Old Wire Road CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Ryan/Donna/Miranda/others- Thank you, first of all, for serving Fayetteville. Being an official in the public eye is not easy these days and I appreciate your willingness to do so. I'm contacting you re: Mitch Weigel's proposal to develop land between the Boxwood subdivision and the fire station at Old Wire/265. I'm sure you've heard from some of my Boxwood neighbors, as this is an emotional issue for some, if not many. Having lived directly adjacent to the property being considered for more than 16 years, however, I have long expected development behind my home. I understand the need for residential infill in Fayetteville. That doesn't mean I like it, but I understand. What I'm asking is for extremely careful consideration of this proposal. Rezoning that allows 10 units per acre - or anything close to that - is simply irresponsible. I don't believe that aligns w Fayetteville's 'Vision 2050' and I think there are other legitimate concerns, including drainage, loss of trees/green space/natural habitat and traffic. Traffic is already an issue in this area - a major issue for those of us who live here. Additionally, the sheer density of 10 units per acre - or anything close to that - is a drastic deviation from what currently exists in our neighborhood. It's simply not right and I am 100-percent convinced that if you or Mitch Weigel or any reasonable person lived where my family lives, you would feel the same way. Thank you for your time and service. Please do what is right. Rob Keys 2792 N. Raintree Drive (479) 957-4635 Page 81 of 425 PUBLIC COMMENT: TIFFANY MEEKS From: To: CityClerk Planning Shared; Sparkman, Sarah; Johnson. Matthew; Canada. Ouintin; Brink. Andrew; Garlock. Jimm; Holcomb, Joseph; Madden, Marv; McGetrick, Marv; Winston, Porter; Berna, Scott; Bolinger, Bonnie; Pennington, Blake; Brown, Chris; Bunch, Sarah; CityClerk; Curth, Jonathan; Harvey, Sonia; Hertzberg. Holly; Batker, Jodi; Jones, D"Andre; Rogers, Kristin; Williams, Kit; Jordan, Lioneld; Mathis, Jeana; Moore, Sarah; Paxton, Kara; Mulford, Patti; Ramirez. Jonathan; Rea. Christine; Norton, Susan; Spohn. Courtney; Thurber, Lisa; Turk, Teresa; Wiederkehr, Mike Cc: tiftim gmail.com; CityClerk Subject: FW: Old wire/boxwood project Date: Wednesday, February 22, 2023 8:36:08 AM Attachments: image001.pnng Good morning everyone, Please see the e-mail below from Ms. Tiffany Meeks as a follow up to the previously shared message. Thank you and have a nice day, Jonathan Office of the City Clerk Treasurer City of Fayetteville, Arkansas 113 West Mountain St, Suite 308 Fayetteville, AR 72701 T 479.575.8323 cityclerk&fayetteville-ar.gov Website I Facebook I Twitter I Instagram I YouTube City of Fayetteville Logo-01 u From: Tiffany Timmons <tiftim@gmail.com> Sent: Wednesday, February 22, 2023 6:14 AM To: CityClerk <cityclerk@fayetteville-ar.gov> Subject: Re: Old wire/boxwood project CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Hi Sarah, Thank you for your response. It does seem very counterproductive that the city council and the school board don't have more of a connection. I am very frustrated with the school district, my 3 children will all attend McNair which is over crowded and building more homes in an already full district without any plans to build a new school seems ridiculous. I attended FPS and had a lovely experience. I'm not sure my kids will enjoy the same if they are forced to attend schools out of their district due to over crowding. Does the city have any input on schools or district lines? If not I think that should be looked at more closely. How can a city function properly without enough schools to support its growing population? Im not a city planner or school district expert but I would think both need to be on the same page as our city moves forward, knowing there will only be more growth and more children that need to Page 82 of 425 attend schools. I would never be able to get to work on time if my kids were redistributed to a school on the west side. The school bus commissioner has said there's no possible way for them to bus kids from the east side to the west side with the shortage of drivers and the amount of kids needing bus services. This is a big concern for my family. When I see more houses going up it just makes me a bit angry knowing it's my kids education that's going to suffer not the city. Thank you! Tiffany (Timmons) Meeks Sent from my iPhone On Feb 21, 2023, at 8:24 AM, CityClerk<cityclerk(@fa)letteville-ar.gov> wrote: Good morning everyone, Please see the e-mail below from Ms. Tiffany Meeks. Thank you and have a nice day, Jonathan Office of the City Clerk Treasurer City of Fayetteville, Arkansas 113 West Mountain St, Suite 308 Fayetteville, AR 72701 T 479.575.8323 cityclerk(aMayettevi I le-ar.gov Website I Facebook I Twitter I Instagram I YouTube ®❑ From: Bunch, Sarah<Sarah.bunch Wayetteville-ar.gov> Sent: Monday, February 20, 2023 11:19 AM To: CityClerk<cityclerkl@fayetteville-ar.gov> Cc: Tiffany Timmons <tiftim(@gmail.com> Subject: Fwd: Old wire/boxwood project Can the Clerk's office please share this email with planning staff, the members of the planning commission, and the city council? Thank you very much. Sarah Sent from my iPad Begin forwarded message: Page 83 of 425 From: Tiffany Timmons <tiftim(@gmail.com> Date: February 13, 2023 at 2:09:07 PM CST To: "Bunch, Sarah" <sarah.bunch(@fayetteville-ar.gov> Subject: Old wire/boxwood project CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Hi! I am sending you this email to speak out in opposition to the proposed development near old wire and boxwood. I live off old wire and my kids attend FPS. We need more roads and schools in this area before any more residence come into the mix. We desperately need another middle school on the east side, as well as more side walks and a wider old wire to accommodate traffic. The traffic in this area during commute times is too busy for more dwellings. More schools and roads please, not more houses and people. Thank you. Tiffany Meeks 479-530-1428 Page 84 of 425 PUBLIC COMMENT: ROB QUALLS City of Fayetteville, Arkansas 113 West Mountain St, Suite 308 Fayetteville, AR 72701 T 479.575.8323 cityclerk(abfayetteville-ar.gov Website I Facebook I Twitter I Instagram I YouTube GMT or PAT■TT■VILLE ARKANSAN From: Rob Qualls <robbieq@gmail.com> Sent: Monday, February 27, 2023 12:53 PM To: CityClerk <cityclerk@fayetteville-ar.gov> Subject: RZN-2023-0004 Support CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Please forward to the Planning Commissioners, Ward 3 Councilmembers, and any planning staff that should get it. Good Afternoon, I am writing in support of RZN-2023-0004. Some of those opposed to this development are citing morning traffic on Old wire road as a reason to deny this request. I also live in the area and have had to wait a minute or two to turn left. In my opinion, most of that traffic is coming from outside of, or at the very edge of Fayetteville. Restricting housing IN Fayetteville, is not going to help that issue. The best thing we can do for traffic is to build more housing, closer to schools, businesses, or amenities. Please approve this rezone, so we can take some pressure off of the housing market, and perhaps keep more people from driving in from Goshen and Elkins because Fayetteville's housing inventory is low. Thanks,. Rob Qualls 2140 E Jonquil Rd, Fayetteville, AR 72703 Page 85 of 425 PUBLIC COMMENT: ALEXIS STEVENS & NICK MOTE Wonsower, Donna From: Alexis Stevens <aestevens3@yahoo.com> Sent: Monday, February 27, 2023 7:12 PM To: Planning Shared; Hopkins, Mirinda; Wonsower, Donna; Umberger, Ryan; Bunch, Sarah; Berna, Scott Cc: Nick Mote Subject: Re: Rezoning of 2910 N Old Wire Road, Fayetteville, AR - Nick Mote and Alexis Stevens Statement in Opposition CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Good evening —as a follow up to my below email and supplement to the attached Statement in Opposition, attached please find traffic data from the Arkansas Department of Transportation for N Old Wire Road which includes an average daily traffic estimate of 8,300 vehicles for the most recent year studied, 2021. Please note that many of the intersecting streets on the segment of N Old Wire Road between the Old Missouri Road and Crossover intersections adjoin N Old Wire Road at steep inclines and with numerous blind spots. This portion of N Old Wire Road additionally includes several curves further decreasing visibility. Thank you, Alexis Stevens and Nick Mote Page 86 of 425 6:59 PEPARTMENT RTATION ir I Traffic Station 2 loar'l Page 87 of 425 6:59 Volume Count 8300 Station ID: Station: Count Type: Count Category: Most Recent ADT: Most Recent A DT Year: ARDOT District: County: Page 88 of 425 Sent from my iPhone > On Feb 27, 2023, at 6:28 PM, Alexis Stevens <aestevens3@yahoo.com> wrote: > Good evening —attached pleased find a Statement in Opposition of the proposed rezoning of the property located at 2910 N Old Wire Rd, Fayetteville, AR 72703, submitted on behalf of Nick Mote and Alexis Stevens, to be presented to the City Planning Commission during its February 27, 2023, meeting related to the same. > Please let me know if you have any questions or require further information. > Thank you, > Alexis Stevens > <In re Rezoning of the Property Located at 2910 N Old Wire Road, Fayetteville, AR - Written Statement in Opposition Submitted by Nick Mote and Alexis Stevens.pdf> > Sent from my iPhone Page 89 of 425 PUBLIC COMMENT: MARY ANNE KNULL From: Mary Anne Kull To: Wonsower. Donna Cc: Umberger, Ryan; Hopkins, Mirinda Subject: Re: Project Information (RZN-2023-0004) Date: Sunday, February 26, 2023 2:09:25 PM Attachments: imaae002.Dna image001.jpo Concerns for RZN-2023-0004.Ddf CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. To Whom it May Concern, I am attaching a letter about my concerns for the rezoning of 2910 N Old Wire Rd: R7-N- 2023-0004 Thank you so much for your consideration, Mary Anne Kull On Wed, Feb 8, 2023 at 11:00 AM Wonsower, Donna <dwonsowernfayetteville-ar.gov> wrote: Mary, This project is scheduled for the February 27 Planning Commission meeting. The packets being posted on the website tomorrow are for the meeting held on February 13, and the packets for the February 27 meeting will be posted in a few weeks. Our apologies for any confusion. Regarding the required mailing, we received a certificate stating that the letters were sent out yesterday (2/7) in advance of the fifteen day requirement so keep an eye on your mailbox. Short of hiring a traffic engineer, factually showing how any development will affect future traffic is difficult; however there are multiple online resources that you could utilize to present facts regarding the current traffic around your neighborhood such as traffic counts from ARDoT, records of vehicle crashes and their severity from the police, any news articles that discuss significant delays specific to your neighborhood and its immediate surroundings, or primary sources like this. My recommendation would be to stay away from opinions like "traffic is terrible here," and instead make statements such as "In the past three weeks, it has taken me an average of twenty minutes to leave my neighborhood every morning because of the amount of traffic on N Old Wire Rd," and to bring data to back up any sources you cite in your research. You are also welcome to email staff with any documents ahead of the meeting and to call with questions. Page 90 of 425 Best Regards, Donna Wonsower Planner, Development Services City of Fayetteville, Arkansas Office: 479.575.8358 ebsite I Facebook I Twitter I Instagram I YouTube 0 From: Mary Anne Kull [m it • ] Sent: Wednesday, February 08, 2023 8:48 AM To: Hopkins, Mirinda <mhopkins o.fayetteville-ar.gov> Subject: Project Information CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Good morning! Thank you so much for providing this information. What do I need to do to prove that this change will factually affect vehicular patterns adversely for patrons of my neighborhood? I am so thankful for this information. We have not received the required mailing for this zoning request. Do you know if it has been sent out as the application requires? Thank you! Page 91 of 425 Mary Anne On Wednesday, February 8, 2023, Hopkins, Mirinda <mhopkins&fayetteville-ar.gov> wrote: Mary Anne, I have attached the submitted request letter. Planning reports will be posted to our website tomorrow afternoon. Let me know is you need anything else. htips://fayettevillear.portal.civicclerk.com/ Thank you Mirinda Hopkins Development Coordinator Planning Division City of Fayetteville 479-575-8267 Website I Facebook I Twitter I Instagram I YouTube ®❑ From: Mary Anne Kull [mailto:makull1017( gm� ail.com] Sent: Tuesday, February 07, 2023 11:01 PM To: Planning Shared <planninggfayetteville-ar.gov>; Hopkins, Mirinda <mhopkins &fayetteville-ar. gov> Subject: Project Information CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Good Day, Page 92 of 425 I am inquiring about the project information for Plan Number: RZN-2023-0004 The posted written notification form indicates that project information is available for public view from the City of Fayetteville Planning Division, but I have not been able to locate it on the submitted application or the planning divisions portion of the website. I would appreciate your help with this information. I am highly concerned about this area being rezoned as NC NEIGHBORHOOD CONSERVATION. Traffic on Old Wire is already highly congested. I am hardly able to make a left hand turn in the mornings to take my children to Butterfield Elementary School. I cannot imagine how that will be amplified with the potential of 10 residential units per acre being permitted in this area. The vocabulary "neighborhood conservation" is very misleading in this instance as currently this area is completely wooded. I am concerned that there is a deliberate deception by choosing this as the zoning to prevent neighbors from being concerned. This will allow signification change to my current neighborhood and will negatively affect the character and home values in the immediate area. I believe that the current zoning of RSF-4 is appropriate to maintain true neighborhood conservation for this area. I look forward to seeing more detailed plans. Sincerely, Mary Anne Kull Page 93 of 425 2840 N Raintree Drive Fayetteville, AR 72703 February 26, 2023 To Whom It May Concern: I am writing to express my deep concern about the proposed rezoning of 2910 N Old Wire Rd from RSF-4 to NC. As a resident of this area, I believe that this rezoning will have a significant negative impact on our community and our environment. One of my main concerns is the increase in traffic that this development will bring to our area. The roads around 2910 N Old Wire Rd are narrow and already congested. Adding more cars to this area will only exacerbate the problem. This will make it more difficult and dangerous for residents to travel to and from their homes, and could even lead to accidents and other safety concerns. I took the below picture from my street corner of Raintree Dr. and N Old Wire Rd. at 4:28PM Tuesday, February 21. Notice that cars are backed up all the way from Crossover to Raintree. What will the addition of more dense housing and businesses (as allowed under the NC zoning), with potentially hundreds of cars added do to the traffic? What about the Fire Station? With the addition of traffic in this area does it cause concern for life saving minutes being lost as the fire truck and emergency responders will be required to navigate through the additional commuters? Page 94 of 425 2910 N Old Wire contains hydric soil and due to the slope of the land, anything that is developed at this property will have runoff into the hydric soil areas pictured below. What will happen to the ecosystem surrounding the Niokaska Trail with the addition of hazardous runoff from the proposed significantly denser development? Natural Features Habira_of interest J St —bank Erosion Rlsk Extreme Hlgh Moderate � Low Minor Unrenkea H,—, P-- I believe that this rezoning does not align with the City of Fayetteville's "Vision 2050" plan. This plan emphasizes sustainable development and responsible use of natural resources, and I believe that this development will only contribute to the environmental degradation of our area. As a mom of 3 children, our oldest child attends Fayetteville public schools with our middle child to join her next year in kindergarten. I am currently following Fayetteville's dilemma with having enough room in McNair Middle school for the children in our neighborhood. Currently, the board does not have a solution. The proposal to bring in the addition of potentially many families and many more children is simply not supported by the current school zone structure. Furthermore, I have some serious questions about the statement of compatibility submitted by Jorgensen & Associates. The statement of compatibility states, "This request to rezone a portion of the RSF-4 to Neighborhood Conservation and adjust the R-A zoning line to match the 100-year floodplain is compatible with neighboring property and will not unreasonably adversely affect or conflict with surrounding land uses." Has Jorgensen and Associates provided a study by a professional to support this claim? What will they do and be liable for in the instance that it does in fact "unreasonably adversely affect or conflict" with the surrounding land uses? The statement of compatibility continues to state, "Within reasonable proximity, rezoning of the property south of Butterfield Elementary to NC, sets a precedence for similar development patterns that serve to promote and protect neighborhood character." This is untrue. The area next to Butterfield Elementary was just recently rezoned as NC. Outside of that one area, this entire area is zoned as RSF-4. This rezoning will drastically change the feel of driving up Old Wire from Crossover. Currently, it is a wooded residential area. The zoning of RSF-4 is what "sets a precedence for similar development patterns that serve to promote and protect neighborhood character." Please see this image to show the zoning for the surrounding areas as evidence: Page 95 of 425 e Fintl atltlress or PlacE snare Q : r.,, Zoning FO / Zoning E conlane st RESIDENTIAL SINGLE-FAMILY O RA RSF�.S n RSF 1 P I RSF 2 NC Io RSF4 RSF 1 RSFB c." RSF-18 a oakcliR st RPZD RESIDENTIAL MULTI -FAMILY NS-G RSF-4 RI-12 - Rattmont St RW y RMF-6 or Or s 9a' r _ ryrY D 1M112 y - `RM118 C y RMF-24 RI-12 RMF-Oo c A v pP1' a INDUSTRIAL — a a.' EM,Ileale fir' ^ /r Ril 1 cttv..Irr nn 6t10N _ a-2 The compatibility statement continues to state, "The zoning line has been adjusted to follow the 100-year flood plain and this zoning line makes more sense than the current zoning line and will ensure that the floodplain would be of minimal impact." Where is the study that has been conducted by a professional to attest that this statement is true? After multiple conversations with environmentalists, I have been advised that due to the increase in impervious surfaces in a wooded area with soil that it will absolutely have a major impact on flooding in an area near already established flood zone hazards. The compatibility statement also says, "Given the proximity to the Fire Station, Crossover (Regional Link), and the Niokaska Trail, we feel that this rezoning is supported in a multitude of ways and will not adversely impact vehicular patterns." Has Jorgensen and Associates contracted a traffic engineer to verify that this statement is true? Based on my personal experience living next to the property in question, there is already substantial traffic during commuter times on Old Wire. In conclusion, I urge you to reconsider the proposed rezoning of 2910 N Old Wire Rd from RSF-4 to NC. I believe that this development will create additional traffic strain on the area, negatively impact the environment, does not align with the City of Fayetteville's "Vision 2050", and the area simply does not have the infrastructure established to support such a drastic change. Thank you for your time and consideration. Sincerely, Mary Anne Kull 2840 N Raintree Dr makuII1017&gmail.com 501-773-1278 Page 96 of 425 RZN-2023-0004 One Mile View NC I, - 2910 N OLD WIRE RD 0 0.13 0.25 0.5 Miles > �O l U) co 10 1 X �U 1 r1I' IQ 1 Subject Property �> } �K� RD�a�� 01 I 1J ' R-O ORTH R-A I 1 1 1 1 1 1 1 1 1 1 1 1 7L SKI\LERN RD ` — I -- NS-L I I I I I I I I I Ding I-2 Ga,reral Intl Is Regional Link — — — RESIDENTIAL SINGLE-FAMILY EXTRACTION NS-G 11 Neighborhood Link _ _ _ _ _� - - - - - - RI-u COMMERCIAL RI-12 Resltlen,iaFOfice — Unclassified DNS-L G1 — Residential Link _ , �ResltleMlal-�rialW21 RSF-.s ��-2 Ica RSF-1 FORM BASED DISTRICTS ■ 1 Planned Neighborhood Link - RSF-2 RSF4 Gewn—ncnra MU—T—g— Planned Residential Link RSF-] RSF-8 Mein s,rea, caviar ■ Osxn,own General — — Shared -Use Paved Trail ' RESIDENTIAL MULTI -FAMILY �Commanlry Services � NeigbborM1ooa services — — Trail (Proposed) Q , RMF-8 �RMF-12 NeigM1borM1ootl Con oe on 1 Fayetteville City Limits i — ; Planning Area — _ RMF-2a PLANNED ZONING DISTRICTS Intluslnal, Resltlentlal INSTITUTIONAL 1 Planning Area Fayetteville City Limits - - -- RMFI INDUSTRIAL Raa Comme alantlL;gMlntlaa,nai P annlnq Uommission RZN-2023-0004 (VAN SCY"e 97 of 425 Page 17 of 20 RZN-2023-0004 2910 N OLD WIRE RD Close Up View "Olp R� 00) —STRAWBE ' Greek - ya eGtia< � . - �m j NORTH Zone Current Proposed Regional Link Neighborhood Link NC 0.0 9.5 P-1 0.0 0.0 Residential Link R-A 6.8 5.7 Feet RSF-4 7.5 0.0 Trail (Proposed) r ' Planning Area 0 75 150 300 450 600 Fayetteville City Limits 1 :2,400 Total 15.2 ac February 27, 2023 RZN-2023-0004 (VAN SC)8"e 98 of 425 Page 18 of 20 February 27, 2023 RZN-2023-0004 (VAN SC)8"e 99 of 425 Page 19 of 20 RZN-2023-0004 Future Land Use 2910 N OLD WIRE RD 0 tA� Q WARWICK-DR—,�2 i v 02 Residential I Neighborhood - r ■ ■ SVRAWBERRY-DR Ile"9 F� �2 - Regional Link Subject Property K- DR Natural �- '0 °off ��5 �• gyp' 00 ; O ' • Q � PEE ��RGVSpN • Neighborhood Link Residential Link Planned Neighborhood Link r _ _i Planning Area _I Fayetteville City Limits - - - Trail (Proposed) Feet 0 145 290 580 870 1:4,800 • I • • OLD WIRE I r IL I' I I I I I I H I I I I I I I I I I I I CD II I V I � 2Q. Q I p I a a I n PICASSO PL— P v� I � Oo I `O City Neighborhood Civic Institutional Civic and Private Open Space Industrial Natural Non -Municipal Government 1,160 Residential Neighborhood Rural Residential Urban Center February 27, 2023 RZN-2023-0004 (VAN S69W 100 of 425 Paoe 20 of 20 Received By Jonathan Curth 04/04/2023 7:09 P.M. CITY OF %PFFAYETTEVILLE ARKANSAS MEETING OF APRIL 4, 2023 TO: Mayor; Fayetteville City Council THRU: Susan Norton, Chief of Staff FROM: Jonathan Curth, Development Services Director DATE: March 31, 2023 CITY COUNCIL MEMO SUBJECT: Traffic volume and crash data request associated with RZN-2023-0004 (2910 N. Old Wire Rd./Van Scyoc) At the March 21, 2023 City Council meeting, a request was made for traffic count and crash data near the proposed rezoning at 2910 N. Old Wire Road (RZN-2023-0004/Van Scyoc). Specifically, interest was expressed in information to support assessing whether a dangerous traffic condition exists, or if one may be created or compounded by development under the proposed rezoning. Accordingly, information was collected from the Fayetteville Police and Public Works Departments, and the Arkansas Department of Transportation (ArDOT). Traffic Crashes Between 2013 and 2023, 140 crashes were documented at the intersections of N. Old Wire Road/N. Old Missouri Road, N. Old Wire Road/N. Crossover Road, and the segment of N. Old Wire Road in-between (see attached for detail). In assigning incidents to specific intersections, the 140 total crashes can be distributed along N. Old Wire Road as follows: • N. Crossover Road: 71 • N. Old Missouri Road: 24 • N. Azalea Terrace: 7 • N. Oak Bailey Drive: 7 • N. Colette Avenue: 5 • N. Strawberry Drive: 2 • N. Boxwood Drive: 1 • Unassigned: 23 • TOTAL: 140 (intersection closest to subject property) The most substantial modification to N. Old Wire Road in the 10-year review period is the installation of a traffic signal at the street's intersection with N. Old Missouri Road. Of the 24 crashes at that location since 2013, two occurred since the signal was installed and activated in December of 2020. Mailing Address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 101 of 425 Traffic Volumes Average Daily Traffic (ADT), also referred to as mean daily traffic, is the average number of vehicles that travel through a specific point during a specific time. ArDOT ADT data is available at three points along Old Wire Road near RZN-2023-0004 (see attached exhibit): • North E. Township Street (8,100 ADT) • Between N. Raintree Drive & N. Oak Bailey Drive (8,300 ADT) • North of E. Skillern Road (1,900 ADT) While a comparison is possible with the areas' other non -arterial streets, including Rolling Hills, Township, and Mission, it bears consideration that the routes have widely -varying characters and roles in the City's network. Mission, for example, is a state highway that connects US 412 from beyond Washington County to downtown Fayetteville. Conversely, Rolling Hills is less than a mile in length. In between the two, Township is a direct east -west connection between Crossover and College that serves both residential and commercial traffic. Despite these distinctions, Mission, Rolling Hills, and Township generally share the two-lane character of Old Wire, although ADT data indicates higher counts than Old Wire, ranging from 9,200 to 14,000 vehicles. For additional information, ArDOT offers the Arkansas Crash Analytics Tool (ACAT). Although ACAT's data is limited to 2017-2021, it includes details such as the crash manner (single - vehicle, sideswipe, head-on, etc.), lighting conditions (daylight, dawn, dusk, etc.), and severity (no injury, possible injury, etc.). The dashboard is available through ArDOT's website or directly through the links below. httDs://www.ardot.aov/divisions/transportation-Diannina-aoiicv/traffic-safetv/ httDs://experience.arcais.com/experience/l 911 f992cabc484a98f64e7c36c2b262/ Attachments: • Fayetteville Police Department Crash Data • ArDOT ADT Counts Page 102 of 425 p p 3 3 p p 0 0 Z V l0 Vl t0 V n n m m .-i 00 m m 00 O N 1� N Ol M Vf Vf Ol V Ol O O 00 N O 01 w O vt Ol O I� O l0 n t0 00 t0 Ol w 00 m I� 1� �"� N 00 00 l0 �O of M Ch I� N N m vt N .-I O 1� w n m n l0 m O m V "'� m N V m O N N M M Ol N m O O Ill M O O m N OD a O �"� 0 "'� n �"� O c-I O 00 Q1 O N O M N I� m O m N O n n N to O m n O O O O O O `� 0 0 0 0 0 O N m O m 0 `� o0 M N O O M N O M O O ryl O O m ryl O M m M M M O 0 0 0 N^ t0 O O tp O N O N O N vt O N t0 O N N t0 t0 O 0 c 0 t0 t` 0 0 0 0 t0 0 O O O O O O O O O O O O O O O O 0 O O 0 0 O O 0 O� O O O O O O O O 0 0 O O O� O O O O O O O 0 0 O O 0 O O O 0 �`�y O O O O O O O O O � O O 0 0 O O 0 0� O O �Ny O O O O O O O O N O O N O O O �^y O O O O N O 0 0 O O 0 0 0 0 O O O O 0 O I� O O N N O N N N 1� 00 l0 I� O �"� N N I� M N 1l1 Ol V V M m N t0 N 1� O N V 01 M l0 Ol R M N N l0 M 00 .-I N .-I O N N N M N N N N N N N N 0 0 N 0 0 N N 0 0 N N 0 0 0 N N 0 0 0 0 N N 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 N N 0 0 0 0 N N 0 0 0 N N 0 0 0 0 N N 0 0 N N 0 0 0 0 N N 0 0 N N 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 0 N N 0 0 0 0 N N 0 0 N N 0 0 0 00 N N N N N O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O 1� 00 IA N O -I vt N In On cq n Ol OM IMlN1N a. -I .n M00 9 V NO V00 N1N NN 9 VM IlA NV a15t OO MO .q On 9 Nt\ t o .r n Mf i N N 9 0V0 9 .OI N O-I M1r .-I 00 9 ON N-I 9 O V I� O O M ..-i .i O 1 .-I .-I . n O n n O O I 1 ..-i .i m W .-I O ..-i .M-I M N O .-I .-I N m ..-i O 0 m .-I .-I 1 l0 ..-i ..-i 0 I O O 00 .-I ..-i .i e-I O .-I .-I "'� N N N N I� .-I .-I V m .-I .-I 00 m .-I .-I M N ..-I .-I m w .-I 1 m V O .-I O M O 1 O m .-I .-I m O O N 00 O O .-I 0 .-I M .-I O 1 .i .i 00 .-I ' n O O O N n 00 l0 0N -cr-zrO mN NN ON 0N mN MN mN NN NN ON mN mN NN 1 1N N mN VN 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 0 0 0 0 0 0 0 0 0 0 0 0 00.-1I 00 0 0 0 \ \ \ \ \ \ \ \ \ N \ \ N N \ \ N \ \ N N \ \ N \ \ N \ \ N \ \ N \ \ N N \ \ N \ \ N \ \ N \ \ N \ \ \ \ \ \ N \ \ N N \ \ N \ \ N \ \ N \ \ N N \ \ N N00 N N \ \ \ \ N \ \ \ \ \ \ N N N M \ M M \ M \ M M M V \ 0 \ 0 V \ 0 O 0 0 \ 0 \ of \ t0 l0 t0 t0 \ l0 l0 \ \ 00 00 00 00 \ 00 00 \ 00 00 \ 0 \ \ 0 01 01 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OJ O1 0) 01 OJ O1 0) N OJ O1 0) OJ O1 N 01 OJ O1 0) 01 OJ O1 0) N OJ O1 0) N OJ O1 0) 01 OJ O1 0) 01 OJ O1 N 01 OJ O1 N 01 OJ O1 0) 01 OJ O1 N 01 OJ O1 0) N > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > OJ O! 0) N OJ O! 0) N OJ N N N OJ O! 0) N W U1 01 01 W U1 01 01 W U1 0! 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O O 0 0 Z Z O O O O O .-I M N h 1 e-I e-I 00 M 0 0 0 0 N N l0 Ol \ \ c-I .ti 0 0 Z M O O O O w 1� O N n .�-I ..-i ..-i 00 .ti N 0 0 N N M a \ 0 \ .-I N .�-I .�-i 0 0 Z M O O O O n O V .-I n w O O 00 N 0 N 0 0 N N Vl rl 0\\ N 0 c-I O o m N w O O O O w w M M N V .--i ..-i Ol Ol 0 0 0 N N O 0 ":Zr 0 O O O O O O N n V M O 1 O O O N N N 0 0 N N M M ."I O \ N 0 O O 3 O O O O O i0 V 71 N m ..-i .i N 00 N 0 0 0 N N �!1 O \ 0 0 O O 0 O O O O w N e-I M l0 w e-I 1 N 00 N 0 0 0 N N N rl 0 0 O O o Z O O O O m w N M N 1 0 0 00 0p 0 0 0 N N N lD \ 0 O O z vO O O O O w 1� ci N 0 1 0 1 O N N N 0 0 N N M Ol \ O ti 3 O O m N 1� N N 0 N 00 ti 01 OJ Y Y O1 W > > OI OI w O! 0) y N U1 01 > LL m f0 w K p } 01 OJ N Y 01 W > > 0i �N w K p p O! 0) y N U1 01 > T LL m w p p 01 OJ N Y 01 W > > m m w w O p O! 0) y N U1 01 > T LL m w p p 01 OJ N N 01 W > > m m w w p O! 0! N N W N > > m m w w 01 OJ N Y O1 W > > m m w w O! 0) y N U1 01 > T m m w w 01 OJ N Y 01 W > > m m w w O! 0) y N U1 01 > T m m w w 01 OJ N Y 01 W > > m m w w O! y U1 > mw w Q a Q w 0 ac z z z ac z 0 0 0 0 0 0 0 0 0 0 0 2 V V z Z U Z Z N m Z\\\\\\\ Z Z Z Z Z Z Z¢ p p p p p p p p z p Z C C., C am K 0 O K K O C m K C C K K O C in p p p p .0 2 3 3 2 3 m 3 3 3 3 3 3 0 0 0 0>> o p p p c p I p c p p c o p 0 0 0 0 0 0 0 0 V O O O O O m 0 0 0 0 z 0 V O p p p p O p Vf M O O 0 0 VI N 0 O O VI V1 0 0 O O VI 0 O Z Z Z Z Z z in Z Z Z Z Z Z Z O O 0 0 0 0 0 V V V U O V O w N t0 M w t0 tD N V N O 1� O O N .-I w w O T w O Z Z Z Z Z Z Z Z Z Z Z Z Z [09 N M N N N M N N N N N N M Page 105 of 425 Arkansas Department of Transportation Average Daily Traffic Counts Old Wire Road 1. North of E. Township Road (8,100 ADT) 2. Between N. Raintree Drive & N. Oak Bailey Dr. (8,300 ADT) 3. North of E. Skillern Road (1,900 ADT) Approximate Subject Property Page 106 of 425 Received By Jodi Batker 04/05/2023 10:29 A.M. Paxton, Kara From: Batker, Jodi Sent: Wednesday, April 5, 2023 10:29 AM To: Jordan, Lioneld; Berna, Scott; Bunch, Sarah; D'Andre Jones; Harvey, Sonia; Hertzberg, Holly; Jones, D'Andre; Moore, Sarah; Turk, Teresa; Wiederkehr, Mike Cc: Paxton, Kara; Norton, Susan; Curth, Jonathan; Williams, Kit; Pennington, Blake Subject: Ordinance to rezone about 15 acres at 2910 Old Wire Road Attachments: 0289_001.pdf Good morning, please find attached a memo from Kit regarding the Ordinance to rezone about 15 acres at 2910 Old Wire Road. Thank you. Jodi Batker Paralegal 113 W. Mountain St., Suite 302 Fayetteville, Arkansas 72701 Telephone: (479) 575-8313 jbatker@fayetteville-ar.gov f SI w` i i h't Facebook I Twitter I Instagram I YouTube From: City Hall 3rd Floor Color Copier Shared Sent: Wednesday, April 05, 2023 11:21 AM To: Batker, Jodi <jbatker@fayetteville-ar.gov>; Williams, Kit <kwilliams@fayetteville-ar.gov> Subject: Attached Image Page 107 of 425 41 DEPARTMENTAL CORRESPONDENCE OFFICE OF THE CITY ATTORNEY TO: Mayor Jordan City Council City Clerk Treasurer Kara Paxton CC: Susan Norton, Chief of Staff Jonathan Curth, Development Services Director FROM: Kit Williams, City Attorney —� DATE: April 5, 2023 RE: Ordinance to rezone about 15 acres at 2910 Old Wire Road Kit Williams City Attorney Blake Pennington Assistant City Attorney Jodi Batker Paralegal I would like to further explain and document my response to Council Member Scott Burna's question about comments attacking the procedure used to present this rezoning request for your consideration. As you remember, I opined that the complaints of the lawyer/residents concerning the rezoning application were insufficient to prevent the City Council from deciding this rezoning request. The Unified Development Code in §154.03 Private Parties Zoning Amendment (A)(3) states that the following information should be presented in the rezoning application: "A statement explaining the compatibility of this proposed rezoning with neighboring property and explaining why the proposed rezoning will not unreasonably adversely affect or conflict with surrounding land uses." Civil Engineers Jorgensen & Associates on behalf of the owner and their representatives furnished the Statement of Compatibility of rezoning most of the current Residential -Single Family- four units per acre (RSF-4) to Neighborhood Conservation (NC). This letter attached to this memo was addressed to and provided to the Development Services Staff which certainly know that the allowed uses of RSF-4 and NC are virtually identical and so inherently Page 108 of 425 compatible to the adjoining RSF-4 neighborhood. Staff also knows that Neighborhood Conservation allows slightly smaller lots and thus increased density and also uses build -to zones rather than wider setbacks for RSF-4. The City Planner who reviewed this letter and its Statement of Compatibility stamped it "Approved." The City Attorney is the official interpreter of the Amendments Chapter, and I find this letter satisfies the application requirements. Some of the residents also questioned whether proper notice was provided to the residents concerning the proposed rezoning. Attached is the Adjacent Property Owner Map as well as the two page listing of first class mailings on February 7, 2023 to the owners of these parcels. I have also attached a photograph of the required Public Hearing Notice sign on Old Wire Road next to the property to be considered for rezoning. These documents establish that the rezoning applicant fulfilled proper notice requirements. As the City Council's appointed interpreter of both the Amendments of Appeals Chapters, my goal has always been to apply common sense to most requirements in these chapters so that citizens, land owners, and developers can reasonable be heard by the City Council rather than applying overly strict requirements which could prevent the City Council from deciding a substantially proper rezoning request or appeal. The specified time limit for an appeal is the one requirement that must be strictly enforced for fairness to all concerned. CONCLUSION I stand by my statements to the City Council that the Planning Department's approval of the rezoning application was proper and supported with required documentation. The three public hearings during which numerous residents were allowed to address the Planning Commission and then the City Council prove that notice of this rezoning did occur, and any due process rights have certainly be afforded to everyone. I do not support or oppose this rezoning request. However, I do opine that the City Council has full authority to decide this rezoning request as it determines what would be in the best interests of Fayetteville. 2 Page 109 of 425 JORGENSEN +ASSOCIATES Civil Ent ine!-in • Survevirn February 3, 2023 City of Fayetteville Development Services 113 West Mountain Street Fayetteville, AR 72701 Re: Rezoning at 2910 N Old Wire Road Dear City Staff; 124 W Sunbridge Drive, Suite 5 Fayetteville, AR 72703 Office: 479.442.9127 Established 1985 On Behalf of the Owner and their representatives, we are submitting a rezoning request for property located along 2910 N Old Wire, Fayetteville, AR 72703. A. The current owner of this site is as follows: Nola VanScyoc Revocable Trust (Parcel Numbers 765- 16047-000, 765-13287-000. 765-16043-000. B. Currently this property is zoned RSF-4 and R-A. C. This property is surrounded by RSF-4 on the north and west, a portion of P-1 to the south and north, and section of R-0 to the east. D. Existing adequate water and sewer are already at this site. E. We feel the requested rezoning is in line with the goals of the City Plan 2040 where the future land use calls for a portion of Residential Neighborhood and Natural. Statement of Compatibility: This request to rezone a portion of the RSF-4 to Neighborhood Conservation and adjust the R-A zoning line to match the 100-year floodplain is compatible with neighboring property and will not unreasonably adversely affect or conflict with surrounding land uses. Within reasonable proximity, rezoning of the property south of Butterfield Elementary to NC, sets a precedence for similar development patterns that serve to promote and protect neighborhood character. The zoning line has been adjusted to follow the 100-year flood plain and this zoning line makes more sense than the current zoning line and will ensure that the floodplain would be of minimal impact. Given the proximity to the Fire Station, Crossover (Regional Link), and the Niokaska Trail, we feel that this rezoning is supported in a multitude of ways and will not adversely impact vehicular patterns. Reviewed by Donna Wonsower Planner, Development Services APPROVED Page 110 of 425 ADJACENT PROPERTY OWNER MAP City File No./Name: RZN-2023-0004 Page 111 of 425 CERTIFICATE OF MAILING I HEREBY CERTIFY THAT A TRUE AND CORRECT COPY OF THE ATTACHED WRITTEN NOTICE WAS PLACED IN THE U.S. MAIL, FIRST-CLASS, POSTAGE PREPAID THIS_7TH DAY OF_FEBRUARY , 2023 AND ADDRESSED AS FOLLOWS: TOUNZEN, MARIVEL 2743 E JUNIPER ST FAYETTEVILLE AR 72703 HEWITT, KATHY CARPENTER 9205 DOVE MEADOW DR DALLAS TX 75243 HUGHES, JOHN THOMAS & ELEANOR JANE 2756 N RAINTREE DR FAYETTEVILLE AR 72703 BROWN, GINGER TRUST 2777 N RAINTREE DR FAYETTEVILLE AR 72703 PINTER, BENJAMIN K & CASEY C 2770 N RAINTREE DR FAYETTEVILLE AR 72703 KBRB LLC PO BOX 9046 FAYETTEVILLE AR 72703 TAKIGIKU,.SUSAN K LIVING TRUST 2778 N RAINTREE DR FAYETTEVILLE AR 72703 CASTILLO-REYES, FERNANDO 2793 N RAINTREE DR FAYETTEVILLE AR 72703 MOTE, NICK A; STEVENS, ALEXIS E 2811 N RAINTREE DR FAYETTEVILLE AR 72703 SHAW, CONNOR B 2784 N RAINTREE DR FAYETTEVILLE AR 72703 MARTINEZ, JORGE & LIGIA 2819 N RAINTREE DR FAYETTEVILLE AR 72703 KEYS, ROBERT H & JULIE 2792 N RAINTREE DR FAYETTEVILLE AR 72703 WASHABAUGH, J WESLEY & ROXANNE 2825 N RAINTREE DR FAYETTEVILLE AR 72703 CROUCH, ROBERT E & MICHELE L 2816 N RAINTREE DR FAYETTEVILLE AR 72703 FREEMAN, NICOLE M & MICHAEL S 2839 N RAINTREE DR FAYETTEVILLE AR 72703 SILANO, MARK M; SILANO, BLYTHE JANE 2824 N RAINTREE DR E FAYETTEVILLE AR 72703 PARK, DEBBIE LEE 2851 N RAINTREE DR FAYETTEVILLE AR 72703 KULL, ANDREW DALLAS & MARY ANNE 2840 N RAINTREE DR FAYETTEVILLE AR 72703 TIFFANY, KALILA L 2830 N STAGECOACH DR FAYETTEVILLE AR 72703 EDENS, ERNEST E 5891 W WHEELER RD FAYETTEVILLE AR 72704 MELLOTT, JOSHUA L REVOCABLE TRUST 2905 N OLD WIRE RD FAYETTEVILLE AR 72703 DEITCHLER, MAX R 2924 N OLD WIRE RD FAYETTEVILLE AR 72703 BROWN, MATTHEW A & AMBER N 2916 N BLUEBERRY LN FAYETTEVILLE AR 72703 YATES, GEORGIA ANN 2940 N BLUEBERRY LN FAYETTEVILLE AR 72703 SPURLOCK, SHAWN D & STACEY L 3066 N STRAWBERRY DR FAYETTEVILLE AR 72703 10652 FRAKER MOUNTAIN CREED, SETH T RD WEST FORK FAYETTEVILLE AR AR 72774 72701 KIRBY FAMILY TRUST 448 N LIMESTONE DR WALKER, LARRY H & ANDREA 2809 N CROSSOVER RD FAYETTEVILLE AR 72703 VAN SCYOC, NOLA REVOCABLE TRUST 2910 N OLD WIRE RD FAYETTEVILLE AR 72703 SHORT, JIM & REBECCA PO BOX 988 - SALEM AR 72576 CITY OF FAYETTEVILLE 113 W MOUNTAIN ST FAYETTEVILLE AR 72701 WALKER, LARRY H & ANDREA N 2809 N CROSSOVER RD FAYETTEVILLE AR 72703 WRIGHT FAMILY TRUST 2763 N CROSSOVER RD FAYETTEVILLE AR 72703 CARDEN, CHERYL PIEPER 2913 N OLD WIRE RD FAYETTEVILLE AR 72703 Page 112 of 425 RADLER, DWIGHT D & LULONG HAMPTON, SHARON LYNN ADLER MEINECKE, JAMES I & DONNA M MEINECKE, JAMES I & DONNA M NELMS, DENNIS E & FREE, FRAN B JOHNSON, WINDSOR MARKER DEVELOPMENT LLC PARKER INVESTMENTS LLC PICKUS, KATHERINE HYATT, DANA R SAYRE, MARIBETH PREWITT WERNER, NICOLAS C; WOOD, CASEY DANIELLE ADAMS, REED & ANNA GRACE SOMERVELL, DONALD & HELINA CITY OF FAYETTEVILLE CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT CURRENT RESIDENT A EJOR6ENSEN CITY FILE NO. /NAME: RZN-2023-0004 4546 JEAN LN FAYETTEVILLE AR 72704 2880 N CROSSOVER RD FAYETTEVILLE AR 72703 2932 N BROOKBURY XING FAYETTEVILLE AR 72703 2932 N BROOKBURY XING FAYETTEVILLE AR 72703 2870 N CROSSOVER RD FAYETTEVILLE AR 72703 4034 N OLD WIRE RD FAYETTEVILLE AR 72703 PO BOX 8951 FAYETTEVILLE AR 72703 P O BOX 8951 FAYETTEVILLE AR 72703 2964 N OAK BAILEY DR FAYETTEVILLE AR 72703 2972 N OAK BAILEY DR FAYETTEVILLE AR 72703 2983 N OLD WIRE RD FAYETTEVILLE AR 72703 2979 N OLD WIRE RD FAYETTEVILLE AR 72703 2971 N OLD WIRE RD FAYETTEVILLE AR 72703 14633 LOCUSTWOOD LN SILVER SPRING MD 20905 113 W MOUNTAIN ST FAYETTEVILLE AR 72701 2769 N RAINTREE DR FAYETTEVILLE AR7 72703 2785 N RAINTREE DR FAYETTEVILLE AR 1 72704 2850 N OLD WIRE RD FAYETTEVILLE AR 72705 2901 N OLD WIRE RD FAYETTEVILLE AR 72706 2923 N OLD WIRE RD FAYETTEVILLE AR 72707 2955 N OAK BAILEY DR FAYETTEVILLE AR 72708 2961 N OAK BAILEY DR FAYETTEVILLE AR 2916 N OLD WIRE RD FAYETTEVILLE AR _72709 72710 3014 N OAK BAILEY DR FAYETTEVILLE AR 72711 Page 113 of 425 CERTIFICATE OF SIGN POSTING 1, Blake Jorgensen, attest that the above sign was posted on 2.6.23 adjacent to Old Wire Road. of person completing the sign posting) City File No./Name: RZN-2023-0004 Page 114 of 425 Page 115 of 425 Received By Jonathan Curth Date: 041223 Time: 8:42 A.M Page 116 of 425 CITY OF Pow, FAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: Kit Williams, City Attorney FROM: Blake Pennington, Assistant City Attorney DATE: SUBJECT: AMEND 130.39 GRAFFITI: RECOMMENDATION: CITY COUNCIL MEMO 2022-279 BACKGROUND: Council Member Turk has sponsored an item to amend §130.39 Graffiti of the Fayetteville Code to create a graffiti abatement program. DISCUSSION: BUDGET/STAFF IMPACT: ATTACHMENTS: Agenda Request Amend 130.39 Graffiti, EXHIBIT A - 120622 ADDITIONAL INFORMATION HAND OUT 2022-1051, ORD REPEAL §130.39 GRAFFITI ENACT NEW, Addtl Info Amended Graffiti Abatement Proposal, Proposed Amended Graffiti Abatement Ordinance Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 117 of 425 Legistar ID No.: 2022- Qc71 AGENDA REQUEST FORM FOR: Council Meeting of December G, 2022 FROM: Council Member Teresa Turk ORDINANCE OR RESOLUTION TITLE AND SUBJECT: AN ORDINANCE TO AMEND §130.39 GRAFFITI IN THE FAYETTEVILLE CODE TO CREATE A GRAFFITI ABATEMENT PROGRAM APPROVED FOR AGENDA: 0,14 6. 1111.- City Council Member Teresa Turk Asst. City Attorney Blake Pennington Approved as to form ii f+, �2 -,I-- Date I�11g12-2- Date Page 118 of 425 ORDINANCE NO. AN ORDINANCE TO AMEND § 13 0.3 9 GRAFFITI IN THE FAYETIEVILLE CODE TO CREATE A GRAFFITI ABATEMENT PROGRAM WHEREAS, the existence of graffiti on buildings, structures, such as fences or walls, or utility poles or boxes, located upon public or privately owned property viewable from a public or quasi - public place within the city is detrimental to property values, degrades the community, causes an increase in crime, is inconsistent with the city's property maintenance and aesthetic standards, and is a nuisance; and WHEREAS, establishing a graffiti abatement program will enable the City to remove graffiti from public and privately owned property in addition to other remedies available to the City and to property owners. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby repeals §130.39 Graffiti of the Fayetteville Code in its entirety and enacts a new § 13 0.3 9 Graffiti as shown in Exhibit A attached hereto and made a part hereof. PASSED and APPROVED this 6tn day of December, 2022. APPROVED: ATTEST: By: By: LIONELD JORDAN, Mayor KARA PAXTON, City Clerk/Treasurer Page 119 of 425 130.39 - Graffiti (A) Definitions. (1) Graffiti: For purposes of this section, the term "graffiti" shall mean any inscription, word, figure, design, symbol or insignia which is marked, etched, scratched, drawn, painted or otherwise affixed to or placed upon public or Private property located within the city to the extent that the same is not approved by the owner. (2) Quasi -public place: Any place, privately owned, but to which the public is invited, which shall include, but is limited to, the following: commercial, industrial and business properties, stores, restaurants, bars, retail business establishments, multi -family housing complexes containing 24 units of more, and their adjoining or related parking areas. (6) Unlawful to Apply Graffiti; Penalty. It shall be unlawful for any person to apply graffiti upon any public and privately owned structure located on public or privately owned real property within the city. Nothing contained herein shall prevent the city from pursuing any other remedy available for redress of any damage or injury caused by the action of any such person. (C)Declaration Of graffiti as unsightly and a nuisance. The existence of graffiti on buildings, structures, such as fences or wails, or utility poles or boxes, located upon public or privately owned property viewable from a public or quasi -public place within the city is detrimental to property values, degrades the community, causes an increase in crime, is inconsistent with the city's property maintenance and aesthetic standards, and is declared to be a nuisance. (D) Right of city to remove (1) Whenever the city becomes aware, or is notified and determines that graffiti is so located on the exterior of a building or structure (including fences and walls), or utility box or pole, on public or privately owned property viewable from a public or quasi -public place within the city, the city shall be authorized to use public funds for the removal of graffiti from the entire exterior of the building or structure affected, or for the painting of graffiti from the entire exterior of the building affected, but shall not authorize or undertake to provide for the painting of any more extensive area than where the graffiti is located, unless the City determines that a more extensive area is required to be repainted in order to avoid an aesthetic disfigurement to the neighborhood or community. (2) All incidents of graffiti should be reported to the Police Department, who may investigate the crime and notify the owner of the property or the property owner's agent and/or any leasehold tenant or utility company, concerning the city's graffiti removal program. The Police Department may also provide information on how to contact the appropriate division or department for the removal of the graffiti. The Police Department may also notify the appropriate division or department of the exact location of the graffiti and the name of the person to be contacted. in the event the owner Page 120 of 425 of the property or the property owner's agent and/or leasehold tenant or utility company cannot be reached after a period of two (2) business days since receiving the complaint, the city will then have the right to enter upon Private property to the extent necessary to take corrective action. (3) Upon notification by the Police Department concerning the necessity to remove the graffiti, the city may make contact with the owner of the property or the property owner's agent, and/or any leasehold tenant and request that they sign a graffiti abatement identification and permission form allowing the city to enter on the property and remove the graffiti. The document will release the city, its officers, agents, and employees of and from any and all liability, claims, demands, causes of action, or obligations of whatsoever arising out of or in any way related to entry upon the property and for the removal of the graffiti. In the event the owner of the property or the property owner's agent and/or leasehold tenant or utility company cannot be reached after a period of two (2) business days since receiving the complaint and after contact has been attempted, the city will then have the right to enter upon private property to the extent necessary to take corrective action. (4) In the event the owner of the property or the property owner's agent, and/or any leasehold tenant refuses to sign the document which authorizes the city to remove the graffiti, the city may give or cause to be given notice to the owner of the property or the property owner's agent, and/or any leasehold tenant, to take corrective action and remove the graffiti from the property within two (2) business days from the date the notice is served, If the graffiti is not removed within two (2) business days after receipt of notice, then the city shall have the right to enter upon private property to the extent necessary to take corrective action to abate the nuisance. (5) In the event that graffiti is discovered and reported on private property such as buildings, structures, fences, walls, or utility poles/boxes, and after thorough documentation by the city, where it is not reasonable to find the property owner or the property owner's agent and/or leasehold tenant or utility company, or in cases where immediate removal of graffiti is deemed necessary (due to profanity, location, etc.), and since removal of graffiti in a timely manner is necessary, the city will then have the right to enter upon private property to the extent necessary to take corrective action. (6) In any case in which the city enters upon private property for the removal of graffiti without actual notice to the owner of the property or the property owner's agent and/or leasehold tenant, the city shall post a notice upon the front of the residence regarding the actions taken by the city to abate the nuisance. (E) Other remedies available to the city. This section does not preclude the city from seeking the removal of graffiti through other available remedies, including those under the Arkansas criminal mischief statutes and the International Property Maintenance Code. Page 121 of 425 EXHIBIT 130.39 - Graffiti (A) Definitions. 0 Olddio� 0 (1) Graffiti: For purposes of this section, the term "graffiti" shall mean any inscription, word, figure, design, symbol or insignia which is marked, etched, scratched, drawn, painted or otherwise affixed to or placed upon any public right-of-way or public or private property located within the City to the extent that the same is not approved by the owner, owner's agent, or leasehold tenant. (2) Quasi -public place: Any place, privately owned, but to which the public is invited, which shall include, but is not limited to, the following: commercial, industrial and business properties, stores, restaurants, bars, retail business establishments, multi -family housing complexes containing 24 units or more, and their adjoining or related parking areas. (B) Unlawful to apply graffiti. It shall be unlawful for any person to apply graffiti upon any right-of-way or upon any public or privately owned structure located on public right-of-way or public or privately owned real property within the City. Nothing contained herein shall prevent the city from pursuing any other remedy available for redress of any damage or injury caused by the action of any such person. (C) Declaration of graffiti as unsightly and a nuisance. The existence of graffiti on buildings, structures, such as fences or walls, or utility poles or boxes, located upon public right-of-way or public or privately owned property viewable from a public right-of-way or public or quasi -public place within the City is detrimental to property values, degrades the community, causes an increase in crime, is inconsistent with the City's property maintenance and aesthetic standards, and is declared to be a nuisance. (D) Right of city to remove graffiti. (1) Whenever the city becomes aware or is notified and determines that graffiti is located on the exterior of a building or structure (including fences and walls), or utility box or pole, on public right-of-way or on public or privately owned property viewable from a public, quasi -public place, or public right- of-way within the City, the City shall be authorized to use public funds for the removal of graffiti from the entire exterior of the building or structure affected, or for the painting over of graffiti from the entire exterior of the building affected. (2) All incidents of graffiti should be reported to the Police Department, who may investigate the crime and notify the owner of the property or the property owner's agent and/or any leasehold tenant or utility company, concerning the City's graffiti removal program. The Police Department may also provide information on how to contact the appropriate division or t al bl Page 122 of 425 department for the removal of the graffiti. The Police Department may also notify the appropriate division or department of the exact location of the graffiti and the name of the person to be contacted. (3) Upon notification by the Police Department concerning the necessity to remove the graffiti, the City should contact the owner of the property or the property owner's agent, and/or any leasehold tenant and request that they sign a graffiti abatement identification and permission form allowing the City to enter on the property and remove the graffiti. (4) In the event the City verifies that the owner of the property or the property owner's agent, and/or any leasehold tenant has not approved the graffiti but refuses to sign the document which authorizes the City to remove the graffiti, the City should give or cause to be given notice to the owner of the property or the property owner's agent, and/or any leasehold tenant to take corrective action and remove the graffiti from the property within two (2) business days from the date the notice is served. If the graffiti is not removed within two (2) business days after service of notice, and the owner, tenant or their agent has not filed a written objection to the removal of the graffiti with the City Clerk within two business days after notice, then the City shall have the right to enter upon private property to the extent necessary to take corrective action to abate the nuisance. (5) If the owner, tenant, or their agent has filed a written objection to the City's removal of the graffiti including accurate contact information within two (2) business days with the City Clerk, the Chief of Staff or designee shall hold a due process hearing within a week after attempted notice to the appellant using the provided accurate contact information. The Chief of Staff or designee shall inform the appellant of the reasons for the planned graffiti removal during the due process hearing and give the appellant an opportunity to respond and justify the non -removal of the suspected graffiti. (E) Other remedies available to the City. This section does not preclude the city from seeking the removal of graffiti through other available remedies, including those under the Arkansas criminal mischief statutes and the International Property Maintenance Code. Page 123 of 425 ORDINANCE NO. AN ORDINANCE TO AMEND § 130.39 GRAFFITI IN THE FAYETTEVILLE CODE TO CREATE A GRAFFITI ABATEMENT PROGRAM WHEREAS, the existence of graffiti on buildings, structures, such as fences or walls, or utility poles or boxes, located upon public or privately owned property viewable from a public or quasi - public place within the city is detrimental to property values, degrades the community, causes an increase in crime, is inconsistent with the city's property maintenance and aesthetic standards, and is a nuisance; and WHEREAS, establishing a graffiti abatement program will enable the City to remove graffiti from public and privately owned property in addition to other remedies available to the City and to property owners. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby repeals § 13 0.3 9 Graffiti of the Fayetteville Code in its entirety and enacts a new § 13 0.3 9 Graffiti as shown in Exhibit A attached hereto and made a part hereof. Page 124 of 425 Received from Blake Pennington EXHIBIT A 02/17/2023 3:24 PM 130.39 - Graffiti (A) Definitions. (1) Graffiti: For purposes of this section, the term "graffiti" shall mean any inscription, word, figure, design, symbol or insignia which is marked, etched, scratched, drawn, painted or otherwise affixed to or placed upon public or private property located within the city to the extent that the same is not approved by the owner. (2) Quasi -public place: Any place, privately owned, but to which the public is invited, which shall include, but is limited to, the following: commercial, industrial and business properties, stores, restaurants, bars, retail business establishments, multi -family housing complexes containing 24 units of more, and their adjoining or related parking areas. (B) Unlawful to Apply Graffiti, Penalty. It shall be unlawful for any person to apply graffiti upon any public and privately owned structure located on public or privately owned real property within the city. Nothing contained herein shall prevent the city from pursuing any other remedy available for redress of any damage or injury caused by the action of any such person. (C)Declaration of graffiti as unsightly and a nuisance. The existence of graffiti on buildings, structures, such as fences or walls, or utility poles or boxes, located upon public or privately owned property viewable from a public or quasi -public place within the city is detrimental to property values, degrades the community, is inconsistent with the city's property maintenance and aesthetic standards, and is declared to be a nuisance. (D)Right of city to remove (1) Whenever the city becomes aware, or is notified and determines that graffiti is so located on the exterior of a building or structure (including fences and walls), or utility box or pole, on public or privately owned property viewable from a public or quasi -public place within the city, the city shall be authorized to use public funds for the removal of graffiti from the entire exterior of the building or structure affected, or for the painting of graffiti from the entire exterior of the building affected, but shall not authorize or undertake to provide for the painting of any more extensive area than where the graffiti is located, unless the City determines that a more extensive area is required to be repainted in order to avoid an aesthetic disfigurement to the neighborhood or community. (2)AII incidents of graffiti should be reported to the Police Department, who may investigate the graffiti and notify the owner of the property or the property owner's agent and/or utility company, concerning the city's graffiti removal program. The Police Department may Page 125 of 425 also provide information on how to contact the appropriate division or department for the removal of the graffiti. The Police Department may also notify the appropriate division or department of the exact location of the graffiti and the name of the person to be contacted. In the event the owner of the property or the property owner's agent and/or utility company cannot be reached after a period of five (5) business days since receiving the complaint, the city will then have the right to enter upon private property to the extent necessary to take corrective action. If the graffiti in question is deemed to be hate speech, the city will initiate an accelerated timeline for removal. In hate speech graffiti circumstances, if the owner of the property or the property owner's agent and/or utility company cannot be reached after a period of one (1) business day since receiving the complaint, the city will then have the right to enter upon private property to the extent necessary to take corrective action. (3) Upon notification by the Police Department concerning the necessity to remove the graffiti, the city may make contact with the owner of the property or the property owner's agent and request that they sign a graffiti abatement identification and permission form allowing the city to enter on the property and remove the graffiti. The document will release the city, its officers, agents, and employees of and from any and all liability, claims, demands, causes of action, or obligations of whatsoever arising out of or in any way related to entry upon the property and for the removal of the graffiti. In the event the owner of the property or the property owner's agent and/or utility company cannot be reached after a period of five (5) business days since receiving the complaint and after contact has been attempted, the city will then have the right to enter upon private property to the extent necessary to take corrective action. If the graffiti in question is deemed to be hate speech, the city will initiate an accelerated timeline for removal. In hate speech graffiti circumstances, in the event the owner of the property or the property owner's agent and/or utility company cannot be reached after a period of one (1) business days since receiving the complaint and after contact has been attempted, the city will then have the right to enter upon private property to the extent necessary to take corrective action. (4) In the event the owner of the property or the property owner's agent, refuses to sign the document which authorizes the city to remove the graffiti, the city may give or cause to be given notice to the owner of the property or the property owner's agent, to take corrective action and remove the Page 126 of 425 graffiti from the property within five (5) business days from the date the notice is served. If the graffiti is not removed within five (5) business days after receipt of notice, then the city shall have the right to enter upon private property to the extent necessary to take corrective action to abate the nuisance. If the graffiti in question is deemed to be hate speech, the city will initiate an accelerated timeline for removal in which case the city will take corrective action after one (1) business days from the date the notice is served. If the graffiti is not removed within one (1) business days after receipt of notice, then the city shall have the right to enter upon private property to the extent necessary to take corrective action to abate the nuisance. (5) In the event that graffiti is discovered and reported on private property such as buildings, structures, fences, walls, or utility poles/boxes, and after thorough documentation by the city, where it is not reasonable to find the property owner or the property owner's agent or utility company, or in cases where immediate removal of graffiti is deemed necessary (due to profanity, location, etc.), and since removal of graffiti in a timely manner is necessary, the city will then have the right to enter upon private property to the extent necessary to take corrective action. (6) In any case in which the city enters upon private property for the removal of graffiti without actual notice to the owner of the property or the property owner's agent, the city shall post a notice upon the front of the residence regarding the actions taken by the city to abate the nuisance. (7) In the event the City verifies that the owner of the property or the property owner's agent has not approved the graffiti but refuses to sign the document which authorizes the City to remove the graffiti, the City should give or cause to be given notice to the property owner or property owner's agent to take corrective action and remove the graffiti from the property within five (5) business days after service of the notice, and the owner or owner's agent has not filed a written objection to the removal of the graffiti with the City Clerk within five (5) business days after the notice, then the City shall have the right to enter upon private property to the extent necessary to take corrective action to abate the nuisance. (8) If the owner or their agent has filed a written objection to the City's removal of the graffiti including accurate contact information within five (5) business days with the City Clerk, the Chief of Staff or designee shall hold a due process hearing within a week after attempted notice to the appellant using the provided contact information. The Chief of Staff or designee shall inform the appellant of the reasons for the planned graffiti removal during the due process hearing and give the appellant an opportunity to respond and justify the non -removal of the suspected graffiti. This objection process does not apply to hate speech graffiti. (E) Cultural Arts and Creative Safe Space. In conjunction with the implementation of the graffiti abatement program, if the city seeks graffiti abatement restitution funds, at least half of those funds will be used for the public arts fund. Additionally, th$ gX 127 of 425 will pilot a creative safe space in the form of a wall to be used by graffiti artists without fear of legal retribution. (F) Other remedies available to the city. This section does not preclude the city from seeking the removal of graffiti through other available remedies, including those under the Arkansas criminal mischief statutes and the International Property Maintenance Code. Page 128 of 425 11 OFFICE OF THE CITY ATTORNEY Recieved From Kit Williams 04/04/2023 3:14 P.M DEPARTMENTAL CORRESPONDENCE TO: Mayor Jordan City Council City Clerk Treasurer Kara Paxton CC: Susan Norton, Chief of Staff FROM: Kit Williams, City Attorney DATE: April 4, 2023 RE: Proposed Amended Graffiti Abatement Ordinance Kit Williams City Attorney Blake Pennington Assistant City Attorney Jodi Batker Paralegal I have worked with Council Member Teresa Turk to make clear that the City will properly respect private property rights while removing graffiti. The ordinance is now more focused on quickly removing graffiti from City property and right-of-way. With consent of the property owner or tenant, the City would be empowered (but not required) to remove or paint over, etc. graffiti on private property if viewable from City property or right-of-way. We also placed a new provision that public utilities operating in City's right-of-way pursuant to a franchise agreement with the City must agree to "promptly remove or abate any graffiti affixed to their equipment or other thing and allow the City to also abate or remove such graffiti without prior notice to the utility." The current graffiti ordinance will be on Unfinished Business on the April 18th City Council Meeting Agenda. Council Member Turk will probably move to amend it to the version she has approved which is attached to this memo. Page 129 of 425 ORDINANCE NO. AN ORDINANCE TO AMEND § 13 0.3 9 GRAFFITI IN THE FAYETTEVILLE CODE TO AUTHORIZE USE OF CITY FUNDS TO ABATE OR REMOVE GRAFFITI ON PRIVATE PROPERTY ON OR VIEWABLE FROM CITY PROPERTY OR RIGHT-OF-WAY WHEREAS, the existence of graffiti on buildings, structures, such as fences or walls, or utility poles or boxes, located upon city property, city right-of-way, and privately owned property viewable from city property or right-of-way is detrimental to property values, costs the City and private property owners abatement expenditures, degrades the economic vitality of the community, is inconsistent with the City's property maintenance requirements, and damaging to our community aesthetic standards, which thereby makes graffiti a nuisance; and WHEREAS, establishing a graffiti abatement program will enable the City to remove graffiti from city property and right-of-way and privately owned property with the consent of the owner, manager, or tenant more quickly; and WHEREAS, the City Council requests the Administration to attempt to obtain consent from the railroad company to authorize City staff to have the right, but not duty, to remove any graffiti from any train trestle in Fayetteville. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby amends § 13 0.3 9 Graffiti of the Fayetteville Code by repealing it and enacting the following: "(A) Definition. For purposes of this section, the term `graffiti' means any inscription, word, figure, design, symbol, or insignia which is marked, etched, scratched, drawn, painted, or otherwise affixed to or placed upon City property, utility property within the City right-of-way or, without the authority or permission of the owner, private property that is viewable from City property or right-of-way. (B) Unlawful to apply graffiti. It is unlawful for any person to apply graffiti upon any City property or City right-of-way (including any utility or other allowed structure on City property or City right-of-way) or upon any structure, fence, wall, dumpster or similar thing on private property without express authority and permission from the property owner. (C) Graffiti declared a public nuisance. Graffiti is detrimental to property values, degrades the aesthetics and attractiveness of the City, causes expenses for the City or private property owners to abate or remove the graffiti, harms the economic vitality of the City and violates the City's property maintenance requirements and the adopted International Property Maintenance Code such that the City Council has determined and now expressly declares that graffiti is a public nuisance which should be promptly removed and kept off of all publicly viewable buildings, structures, utility equipment, and other places. Page 130 of 425 (D) City staff empowered to abate or remove graffiti from private property with the consent of the owner or tenant. Because graffiti is a public eyesore and nuisance, the City has a public purpose to use public funds or staff to abate or remove graffiti from privately owned property that is viewable from City property or City right-of-way with the consent of the owner or tenant. (E) All Utilities with a City franchise to use City right-of-way agree to graffiti removal. By placing or maintaining equipment or other things on City property or right-of-way, all utilities with franchises to use City property or right-of-way agree to promptly remove or abate any graffiti affixed to their equipment or other thing and allow the City to also abate or remove such graffiti without prior notice to the utility. This provision is an amendment to all City franchise agreements if the franchisees use the City right-of-way after June 1, 2023. (F) Other remedies remain available to the City. This section does not preclude the City from seeking the abatement or removal of graffiti through criminal mischief prosecutions, enforcement of the International Property Maintenance Code, or other remedies. Page 131 of 425 ® City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Legislation Text File #: 2022-319 AN ORDINANCE TO AMEND §51.136 MONTHLY WATER RATES AND §51.137 MONTHLY SEWER RATES TO CHANGE WATER AND SEWER RATES: AN ORDINANCE TO AMEND §51.136 MONTHLY WATER RATES AND §51.137 MONTHLY SEWER RATES TO CHANGE WATER AND SEWER RATES AS RECOMMENDED BY THE COST OF SERVICE STUDY CONDUCTED BY BLACK & VEATCH WHEREAS, the City of Fayetteville's current water and sewer rates were adopted in 2008 based on a Cost of Service Study conducted by HDR Engineering; and WHEREAS, on August 18, 2020, the City Council approved Resolution 212-20 authorizing a contract with Black & Veatch for an updated Cost of Service Study; and WHEREAS, the Black & Veatch Cost of Service Study recommends initial changes in both water and sewer rates that reflect the true cost of service by customer class and a 3% annual increase in rates each year thereafter until a new study is conducted; and WHEREAS, the City Council has determined, after the public hearing required by Ark. Code Ann. § 14- 23E-223, that the proposed rate changes reflecting the true cost of service should be adopted and that the new rates shall take effect on January 1, 2023. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby repeals §51.136 Monthly Water Rates and enacts a new §51.136 as shown in Exhibit A attached to this Ordinance. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby repeals §51.137 Monthly Sewer Rates and enacts a new §51.137 as shown in Exhibit B attached to this Ordinance. Page 1 Page 132 of 425 City of Fayetteville Staff Review Form 2022-0517 Legistar File ID 6/21/2022 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Paul Becker 6/2/2022 WATER SEWER (720) Submitted By Submitted Date Division / Department Action Recommendation: Approval of the Water and Sewer Rate changes, rescinding and replacing sections 51.136 and 51.137 of the City Code of Ordinances and holding a Public Hearing based on a Rate Study conducted by Black and Veatch recommended by the Fayetteville Water and Sewer Committee. Budget Impact: N/A Water/Sewer Account Number N/A Project Number Budgeted Item? No Current Budget Funds Obligated Current Balance Does item have a cost? No Item Cost Budget Adjustment Attached? No Budget Adjustment Remaining Budget Purchase Order Number: Change Order Number: Original Contract Number: Comments: Fund N/A Project Title $ - Previous Ordinance or Resolution # Approval Date: V20210527 Page 133 of 425 CITY OF FAYETTEVILLE ARKANSAS MEETING OF JUNE 21, 2022 TO: Mayor and City Council FROM: Paul Becker, Chief Financial Officer DATE: June 3, 2022 CITY COUNCIL MEMO SUBJECT: Approval of the Water and Sewer Rate changes, rescinding and replacing sections 51.136 and 51.137 of the City Code of Ordinances and the holding of a Public Hearing based on a Rate Study conducted by Black and Veatch recommended by the Fayetteville Water and Sewer Committee RECOMMENDATION: Administration recommends approval of an ordinance changing the water and sewer rates based on a Cost of Service Study conducted by Black and Veatch as presented to the Water and Sewer Committee in open meetings. These recommended rates are reflected in the attached replacement for sections 51.136 and 51.137 of the Fayetteville code of Ordinances. BACKGROUND: The City of Fayetteville has been conducting a water and sewer rate study since August 2020. Black and Veatch was selected pursuant to RFQ 20-01 by the City Council on August 18, 2020 with the approval of Resolution 212-20. The intent of the rate study is to establish water and sewer rates that fully recover the cost of providing service to customers, adequately provide for maintaining and expanding the City's infrastructure, and provide adequate reserves for future needs. The study is based on a comprehensive review of the City of Fayetteville's water and sewer funds and budgets, comprehensive Water Master Plan, Wastewater Master Plan, planned wastewater facilities upgrades, customer classes, current usage data, future planned growth of the City of Fayetteville, and any other information deemed necessary. The current water and sewer rates were adopted by the City of Fayetteville in 2008 based on a Cost of Service Study reformed by HDR Engineering. As a part of that study an annual 3% inflationary increase for each rate classification was authorized. This was sufficient to fund operations and capital need until now without a full rate study. Rate studies were delayed during the period between 2008 and 2020 primarily because the City was working on the permitting process for our two plants. The Noland Plant was conducting a Use Attainability Analysis (UAA) on the receiving stream (The White River) to determine acceptable Chloride, Sulfate and Total Dissolved Solids discharge limitations. Based on the outcome of the UAA there was the possibility of a major upgrade to the Noland Facility. Mailing Address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 134 of 425 The West Side Plant discharges to Goose Creek and eventually the Illinois River, and the negotiations between Arkansas and Oklahoma concerning total phosphorus in the Illinois River Watershed could have had a significant impact on the plant's discharge limit for phosphorus. Based on the outcome, the West Side Plant could have significant capital upgrades. It was not feasible for the City to conduct a rate study during this time period because the rates might have been inadequately adjusted prior to the outcome of these two issues, resulting in an additional rate adjustment soon after the initial change. Those issues have been resolved at this time and new permits have been, or are being issued. However, extensive new capital needs are required at this point in time and operating cost have increased above the revenue increases generated by an annual 3% proportional adjustment. DISCUSSION: State code dictates a schedule of events for any change in water and sewer rates. These require that the rate change ordinance be read, a public hearing be scheduled and announced, the ordinance be published, and the public hearing take place at least ten days after the initial reading and publication of the ordinance. The rate ordinance can then be approved any time after the public hearing. The public hearing attachment details the public notice process for the proposed rate study, and what the initial changes will be to the water and sewer rates. A copy of the notice that is required to be published in the newspaper is attached and shows the changes by customer class. Additionally, the Monthly Water and Sewer Rates attachment indicates the level of rate increases through 2025. The rate study prepared by Black and Veatch reflects some of the following guidelines: 1. The City has adopted a cost of service rate schedule based on customer class. 2. The City is using a volumetric block system within customer class to encourage conservation 3. New rates reflecting the true cost of service by customer class as determined by the rate study will be implemented on January 1, 2023. 4. A 3% annual inflation increase shall be applied at the first of each new calendar year until a new study is adopted. BUDGET/STAFF IMPACT: Adoption of these new rates will provide necessary revenues to address current operating costs and capital needs. Attachments: Revised Sections 51.136 and 51.137 of the Fayetteville Code of Ordinances Black and Veatch Water and Wastewater Comprehensive Rate Study Exhibits A and B - 51.136 and 51.137 - Monthly Water and Sewer Rates Public Hearing Notice - Water and Wastewater Rate changes 2023 Page 135 o?425 51.136 Monthly Water Rates Effective as of the first billing statements issued after December 31, 2022, the following monthly rates shall be fixed as rates to be charged for water furnished by the waterworks system of the city, which rates the City Council finds and declares to be reasonable and necessary minimum rates to be charged. All non -emergency water uses shall be billed to the user, to include but not limited to water used for: use within structures; business; manufacturing; irrigation; retail by another water utility; city uses; educational purposes; medical purposes; water system routine non -emergency uses; wastewater system routine non -emergency uses; non-profit uses; fire department non -emergency uses to include training and equipment calibration; construction of new water mains; street cleaning; and wet down of construction sites and materials. Emergency water use that does not pass through a water system meter shall not be billed, including firefighting, water leaks, water leak repair, and emergency water line flushing. The volumes used for these emergency purposes should be estimated and submitted monthly to the Business Office Manager and the Water/Sewer Operations Manager. (A) Monthly Water Rates. (1) The water usage of each customer shall be determined each month by meter measurement and the amount per 1,000 gallons to be paid for water usage by each customer shall be computed on the basis of the following schedule of rates. Table A-1 Monthly Water Rates Prior to January 1, 2023 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.51 $4.04 Next 13,000 $4.65 $5.35 Over 15,000 $6.59 $7.54 Non -Residential First 300,000 $3.79 $4.38 Over 300,000 $3.39 $3.90 Major Industrial All Usage $2.96 $3.40 Irrigation First 300,000 $5.04 $5.80 Over 300,000 $4.53 $5.22 Wholesale Reduced Peak Demand $2.87 $2.87 Peak Demand $3.20 $3.20 Table A-2 Monthly Water Rates After December 31, 2022 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.30 $4.47 Next 13,000 $4.37 $5.91 Over 15,000 $6.20 $8.38 Non -Residential First 300,000 $3.93 $5.05 Over 300,000 $3.93 $5.05 (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 1 of 11 Page 136 of 425 Major Industrial All Usage $3.14 $3.49 Irrigation First 300,000 $4.29 $5.43 Over 300,000 $4.29 $5.43 Wholesale Reduced Peak Demand $3.16 $3.16 Peak Demand $3.16 $3.16 Table A-3 Monthly Water Rates After December 31, 2023 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.40 $4.60 Next 13,000 $4.50 $6.09 Over 15,000 $6.39 $8.63 Non -Residential First 300,000 $4.05 $5.20 Over 300,000 $4.05 $5.20 Major Industrial All Usage $3.23 $3.59 Irrigation First 300,000 $4.42 $5.59 Over 300,000 $4.42 $5.59 Wholesale Reduced Peak Demand $3.25 $3.25 Peak Demand $3.25 $3.25 Table A-4 Monthly Water Rates After December 31, 2024 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.50 $4.74 Next 13,000 $4.64 $6.27 Over 15,000 $6.58 $8.89 Non -Residential First 300,000 $4.17 $5.36 Over 300,000 $4.17 $5.36 Major Industrial All Usage $3.33 $3.70 Irrigation First 300,000 $4.55 $5.76 Over 300,000 $4.55 $5.76 Wholesale Reduced Peak Demand $3.35 $3.35 Peak Demand $3.35 $3.35 (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 2 of 11 Page 137 of 425 (2) Beginning January 1, 2026, all monthly water rates shall be increased by 3% per year. (3) All bills under such schedules shall be computed by adding the applicable meter service charge prescribed by subsection (B) to the amount determined to be due for water usage under this schedule. Applicable sales tax and franchise fees shall be added to the bill so computed. (4) When a common facility/building is served by multiple water meters and the water usage is for the same purpose, customers may petition the Water & Wastewater Director and/or the Finance & Internal Services Director to have the water consumption aggregated and have the tiered rates apply to the aggregated quantity. (5) Water used for flushing and sampling of newly constructed water lines, Fire Department training and equipment calibration, and other similar uses requiring a large volume and/or high velocity of water movement shall employ a fire hydrant meter of the appropriate size for the use. If a fire hydrant meter cannot be used due to high flow or volume requirements, then the volume of water used shall be measured by using a pitot gauge to determine the gallons per minute and by timing the flow of water to be able to calculate total volume. In the cases of fire department training and equipment calibration, sewer line washing, street sweeping, and other uses where the equipment employed has a built-in water meter, these built in water meters may be used. All such meters other than those on fire trucks must be evaluated by the Meter Superintendent. These water uses shall be billed at the same rates as non-residential customers. (6) Monthly wholesale treated water rates outside city limits are based on Cost of Service Methodology. (B) Monthly Water Service Charge. (1) In addition to the above, each customer shall pay a monthly water service charge in accordance with the following schedule: Table B-1 Monthly Water Service Charge Prior to January 1, 2023 Meter Size Inside City Outside City Wholesale % x % inch $6.59 $7.54 $7.54 1 inch $9.14 $10.52 $10.52 1 Y2 inch $15.93 $18.31 $18.31 2 inch $23.20 $26.66 $28.56 3 inch $54.05 $62.18 $64.38 4 inch $89.50 $102.93 $112.25 6 inch $178.99 $205.82 $213.02 8 inch 1 $268.41 1 $308.67 1 $319.47 Table B-2 Monthly Water Service Charge After December 31, 2022 Meter Size Inside City Outside City Wholesale % x % inch $6.59 $7.54 $7.54 1 inch $9.14 $12.26 $12.26 1 % inch $15.93 $24.22 $24.22 (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 3 of 11 Page 138 of 425 2 inch $23.20 $33.52 $33.52 3inch $54.05 $69.84 $69.84 4 inch $89.50 $102.93 $102.93 6 inch $178.99 $205.82 $205.82 8 inch 1 $268.41 1 $308.67 1 $308.67 Table B-3 Monthly Water Service Charge After December 31, 2023 Meter Size Inside City Outside City Wholesale % x % inch $6.79 $7.77 $7.77 1 inch $9.41 $12.63 $12.63 1 % inch $16.41 $24.95 $24.95 2 inch $23.90 $34.53 $34.53 3 inch $55.67 $71.94 $71.94 4 inch $92.19 $106.02 $106.02 6 inch 1 $184.36 1 $211.99 1 $211.99 8 inch 1 $276.46 1 $317.93 1 $317.93 Table B-4 Monthly Water Service Charge After December 31, 2024 Meter Size Inside City Outside City Wholesale % x % inch $6.99 $8.00 $8.00 1 inch $9.70 $13.01 $13.01 1 % inch $16.90 $25.69 $25.69 2 inch $24.61 $35.56 $35.56 3inch $57.34 $74.09 $74.09 4 inch $94.95 $109.20 $109.20 6 inch $189.89 $218.35 $218.35 8 inch $284.76 $327.47 $327.47 (2) Beginning January 1, 2026, all monthly water service charges shall be increased by 3% per year. (3) The monthly treated water rates and the monthly meter service charge rates prescribed by subsections (A) and (B) of this section shall commence as of the first billing statements issued after December 31, 2022. (4) The State of Arkansas mandated Safe Drinking Water Act fee shall be added to the monthly water utility bill. (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 4 of 11 Page 139 of 425 (C) Monthly Standby Fire Protection Service Charge. (1) Charges for unmetered service connections for standby fire protection and fire hydrants shall be based on the incoming line size or the backflow preventer size, whichever is smaller, as set forth in the following table: Monthly Standby Fire Protection Service Charge Line Size or Backf low Preventer Size Inside City Outside City 1 inch $9.75 $11.68 2 inch 10.17 12.10 2.5 inch 20.33 23.37 3 inch 30.48 35.06 4 inch 60.97 70.11 6 inch 169.34 194.74 8 inch 355.65 409.00 10 inch 609.68 701.11 (2) The Utilities Department shall review the monthly standby fire protection service charges every two (2) years and shall make recommendations to the City Council following such review. Fire protection lines shall not be connected to the water system downstream from a meter. (Code 1965, §21-25; Ord. No. 1165, 4-18-58; Ord. No. 2144, 9-2-75; Ord. No. 2594, 2-5-80; Ord. No. 3197, 7-1-86; Ord. No. 3409, 2-21-89; Ord. No. 3431, 6-6-89; Ord. No. 3491, 7-17-90; Ord. No. 3513, 9-18-90; Ord. No. 3519, 11- 20-90; Ord. No. 4059, §1, 10-7-97; Ord. No. 4223, 2-15-00; Code 1991, §51.136; Ord. No. 4530 12-02-02; Ord. No. 4540, 02-03-04; Ord. No. 5123, 4-1-08; Ord. No. 6169 , §1, 4-2-2019) 51.137 Monthly Sewer Rates (A) Monthly Sewer Rates. (1) All monthly sewer charges shall be calculated from the customer's monthly water usage. The following monthly rates are hereby fixed as rates to be charged for sewer services: (Supp. No. 25) Created: 2022-OS-17 11:20:0S [EST] Page 5 of 11 Page 140 of 425 Table D-1 Monthly Sewer Rates Per 1,000 Gallons Before January 1, 2023 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $4.35 Greater than $5.80 2,000 gallons Non -Residential All Usage $4.40 Major Industrial All Usage $4.71 Farmington All Usage $7.52 Outside city All Usage $8.18 Elkins 85% of metered $5.19 water usage Usage above 85% of $2.71 metered water usage Table D-2 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2022 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.39 Greater than $4.52 2,000 gallons Non -Residential All Usage $5.10 Major Industrial All Usage $5.71 Farmington All Usage $8.27 Outside city All Usage $8.55 Elkins 85% of metered $7.20 water usage Usage above 85% of $7.20 metered water usage (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 6 of 11 Page 141 of 425 Table D-3 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2023 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.49 Greater than $4.66 2,000 gallons Non -Residential All Usage $5.25 Major Industrial All Usage $5.88 Farmington All Usage $8.52 Outside city All Usage $8.81 Elkins 85% of metered $7.42 water usage Usage above 85% of $7.42 metered water usage Table D-4 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2024 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.60 Greater than $4.80 2,000 gallons Non -Residential All Usage $5.41 Major Industrial All Usage $6.06 Farmington All Usage $8.77 Outside city All Usage $9.07 Elkins 85% of metered $7.64 water usage Usage above 85% of $7.64 metered water usage (2) Beginning January 1, 2026, all monthly sewer quantity charge- usage rates per 1,000 gallons shall be increased by 3% per year. (3) Sewer related fees levied by the Cities of Farmington or Greenland shall be added to the wastewater utility bill at the request of Farmington or Greenland. These fees may be calculated on a per -thousand volumetric usage or a per month basis. (B) Monthly Sewer Service Charge. (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 7 of 11 Page 142 of 425 (1) In addition to the above, each customer shall pay a monthly sewer service charge in accordance with the following schedule: Table E-1 Monthly Sewer Service Charge Prior to January 1, 2023 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.28 $18.28 $16.74 1 inch $23.74 $33.92 $31.28 1% inch $38.77 $60.37 $55.50 2 inch $55.43 $79.73 $73.45 3 inch $128.73 $184.24 $169.29 4 inch $212.13 $303.44 $278.93 6 inch $420.39 $601.46 $553.70 8 inch $628.73 $899.76 $826.81 Table E-2 Monthly Sewer Service Charge After December 31, 2022 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.28 $18.28 $25.10 1 inch $23.74 $33.92 $52.62 1% inch $38.77 $66.73 $109.78 2 inch $55.43 $93.11 $154.24 3 inch $128.73 $196.10 $327.83 4 inch $212.13 $303.44 $482.37 6 inch $420.39 $601.46 $897.30 8 inch $628.73 $899.76 $998.92 Table E-3 Monthly Sewer Service Charge After December 31, 2023 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.83 $18.83 $25.85 1 inch $24.45 $34.94 $54.20 1% inch $39.93 $68.73 $113.07 2 inch $57.09 $95.90 $158.87 3 inch $132.59 $201.98 $337.66 4 inch $218.49 $312.54 $496.84 6 inch $433.00 $619.50 $924.22 8 inch $647.59 $926.75 $1,028.89 (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 8 of 11 Page 143 of 425 Table E-4 Monthly Sewer Service Charge After December 31, 2024 Meter Size Inside City Outside Cityt Farmingtont % x % inch $19.39 $19.39 $26.63 1 inch $25.19 $35.99 $55.82 1% inch $41.13 $70.79 $116.47 2 inch $58.81 $98.78 $163.63 3 inch $136.57 $208.04 $347.79 4 inch $225.05 $321.92 $511.75 6 inch $445.99 $638.09 $951.95 8 inch $667.02 $954.56 $1,059.75 tCost of Service Methodology required by contract. (2) Beginning January 1, 2026, all monthly sewer service charges shall be increased by 3% per year. (C) Determination of Sewer Quantity Charge for Residential Customers. (1) In the case of residential customers residing in a single family home, duplex, triplex, and/or fourplex, the average monthly water consumption for the preceding months of December, January, and February shall be computed separately for each customer, and a uniform monthly charge for each customer shall be determined by applying the schedule of rates set out in subsection (A) of this section to such average monthly water consumption. In the case of a residential user for whom a uniform monthly charge has been established and who moves to a new location the same uniform monthly charge shall apply at the new location. In the case of new residential customers, sewer averages shall be established based on the number of individuals residing within the dwelling unit, at a rate of 2,100 gallons per customer per month. This methodology of sewer averaging shall not apply to multi -family structures containing five (5) or more units in a contiguous building. (2) In the case of sewer customers who do not have a water meter provided by a public water utility, the sewer usage volume billed shall be the average volume of all users in the sewer system in like dwellings from the most recent system -wide sewer average calculation. (D) Determination of Charge for Non-residential and Major Industrial Customers. In the case of non-residential and/or major industrial customers, the monthly sewer charge shall be determined by applying the schedule of rates prescribed in subsection (A) of this section to the monthly water usage of such customers. In the event that a non-residential or major industrial customer discharging waste into the city's sanitary sewer system produces evidence to the Water and Wastewater Director demonstrating that a substantial portion of the total amount of water from all sources used for all purposes does not reach the sanitary sewer which is in excess of the factors used in establishing the rates in subsection (A) of this section, an estimated percentage of total water consumption to be used in computing charges may be established by the Water and Wastewater Director. The factors used in establishing said rates are on file in the office of the Water and Wastewater Director and are incorporated herein by reference thereto. Any rate so adjusted by the Water and Wastewater Director shall be effective for a twelve (12) month period beginning with the billing for the month when rates adjudged hereby go into effect. (E) Extra Strength Surcharge. (1) For all significant industrial users as defined in §51.074, whose wastewater discharge is greater than 300 mg/I of BOD s and/or TSS, the city shall levy an Extra Strength Surcharge for each parameter in accordance with the following unit charges: Created: 2022-OS-17 11:20:05 [EST] (Supp. No. 25) Page 9 of 11 Page 144 of 425 Table F3 Extra Strength Surcharges After 12/31/2022 Extra Strength BOD 5 $0.5426 per pound Extra Strength TSS $0.6921 per pound (2) Starting after December 31, 2023, Extra Strength Surcharges shall be increased by 3% per year. (3) Extra Strength Surcharges shall be billed monthly and shall be computed on the basis of water meter reading (wastewater discharge volume). (4) All sampling and analyses of the wastewater characteristics shall be performed in accordance with U.S. Environmental Protection Agency 40 Code of Federal Regulations Part 136 approved methods. (5) The volume of flow used in computing surcharge shall be based upon metered water consumption as shown in the records of meter readings maintained by the city's business office. In the event that a user discharging waste into the city sanitary sewer system produces evidence to the city demonstrating that a portion of the total amount of water used for all purposes is not discharged into the sanitary sewer, a separate meter or meters or other approved flow measuring device may be installed at the user's expense, upon its request, to measure only that portion of the total flow being discharged into the city sewer system. If a surcharge is assessed by the city, it shall be shown separately on the monthly billing. (6) Any person discharging industrial waste into the sanitary sewers of the city who procures any part or all of the user's water supply from sources other than the city, all or part of which is discharged into the sanitary sewer, shall install and maintain at the user's expense water meters of the type approved by the city for the purpose of determining the proper volume of flow to be used in computing sewer service charges. Such meter will be read monthly and tested for accuracy when deemed necessary by the city. Where it can be shown that a portion of the water measured by the aforesaid meter or meters does not enter the sanitary sewer system of the city, a separate meter or meters or other approved flow measuring device may be installed at the user's expense, upon its request, to measure only that portion of the total flow being discharged into the city sewer system. If a surcharge is assessed by the city, it shall be shown separately on the monthly billing. (7) Computation of extra strength surcharges shall be based on the following formula: (a) Extra strength surcharge: S I = V x 8.34 x [BOD Unit Charge (BOD - 300) + SS Unit Charge (TSS - 300)] (b) Where: S = Surcharge in dollars V = Sewer volume in million gallons 8.34 = Pounds per gallon of water BOD Unit Charge = Unit charge for BOD in dollars per pound BOD = BOD strength in parts per million 300 = Allowed BOD strength in parts per million TSS Unit Charge = Unit charge for suspended solids in dollars per pound (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 10 of 11 Page 145 of 425 TSS = Suspended solids strength in parts per million 300 = Allowed TSS Strength in parts per million (F) Elkins Sewer Charges. (1) Elkins' payment for wastewater treatment shall be based on 85% of the metered water purchased. The volume of wastewater received by Fayetteville at the "Point of Connection" shall be measured by the installed wastewater meter. Volumes of wastewater below or above the agreed upon percentage (85%) of metered water, as measured by the wastewater meter, shall be recorded on a monthly basis, with a reconciliation of the net difference to occur semiannually in June and December. If the reconciliation volume is over the agreed upon percentage, this amount shall be billed to Elkins in June and December at the actual computed cost of wastewater collection to and treatment at the Noland Wastewater Treatment Plant, not including the calculated rate of return and not including depreciation charges, but including any capacity surcharge, based on the most recent rate as determined in paragraph B of this contract. If the reconciliation volume is below the agreed upon percentage, the actual amount billed for the difference shall be refunded to Elkins in June and December (2) Elkins Impact Fee Charges. The City of Elkins shall pay an additional $0.25 per 1,000 gallons of wastewater, for all wastewater volume charges including both the 85% of metered water volume and for wastewater in excess of the 85% of the metered water purchased billed volume. (G) Hauled Wastewater Fees. (1) Application fee. An application to discharge hauled domestic waste must be accompanied by a fee of $100.00. (2) Discharge fee. A fee of $50.00 must be paid for each hauled domestic waste load discharged. (H) Industrial Wastewater Discharge Permit Fee. (1) Application Fee. An application for an industrial wastewater discharge permit must be accompanied by a fee of $500.00. (Code 1965, §21-26; Ord. No. 1165, 4-18-58; Ord. No. 3197, 7-1-86; Ord. No. 3285, 8-4-87; Ord. No. 3398, 1-3-89; Ord. No. 3491, 7-17-90; Ord. No. 3637, §§1, 2, 8-18-92; Ord. No. 4059, §2, 10-7-97; Code 1991, §51.137; Ord. No. 4530, 12-02-03; Ord. No. 4803, 12-20-05; Ord. No. 4998, 4-3-07; Ord. No. 5129, 4-15-08; Ord. No. 5438, 9-20-11; Ord. No. 5739, 2-17-15) (Supp. No. 25) Created: 2022-OS-17 11:20:05 [EST] Page 11 of 11 Page 146 of 425 Draft WATER AND WASTEWATER COMPREHENSIVE RATE STUDY B&V PROJECT NO. 406577 PREPARED FOR City of Fayetteville, Arkansas 26 MAY 2022 13, BLACK&VEATCH Page 147 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table of Contents 1.0 Executive Summary........................................................................................................ ES 1-0 1.1 Summary of Findings.................................................................................................. ES 1-0 1.1.1 Revenue Under Existing Rates.................................................................... ES 1-0 1.1.2 Revenue Requirements............................................................................... ES 1-1 1.1.3 Summary of Cash Flow Results................................................................... ES 1-2 1.1.4 Cost of Service Analysis............................................................................... ES 1-2 1.2 Proposed Rate Adjustments....................................................................................... ES 1-3 1.3 Disclaimer................................................................................................................... ES 1-3 2.0 Introduction.......................................................................................................................2-0 2.1 Purpose............................................................................................................................2-0 2.2 Scope................................................................................................................................2-0 2.3 Study Methodology......................................................................................................... 2-1 2.3.1 Financial Plan....................................................................................................2-1 2.3.2 Cost of Service..................................................................................................2-1 2.3.3 Rate Design.......................................................................................................2-2 3.0 Rate Structure Overview.....................................................................................................3-0 3.1 Fixed Charge.....................................................................................................................3-0 3.2 Volumetric (Usage) Charge..............................................................................................3-0 3.3 Existing Rate Structure.....................................................................................................3-0 3.3.1 Water Rate Structure.......................................................................................3-0 3.3.2 Wastewater Rate Structure..............................................................................3-1 4.0 Water Utility.......................................................................................................................4-1 4.1 Water Revenue Projections Under Existing Rates...........................................................4-1 4.1.1 Water Revenue Under Existing Rates..............................................................4-1 4.1.2 Projection of Service Revenue Under Existing Rates.......................................4-3 4.1.3 Other Water Revenue......................................................................................4-3 4.2 Water Capital Improvements Program............................................................................4-4 4.3 Water Revenue Requirements........................................................................................4-4 4.3.1 Water Operation and Maintenance Expenses.................................................4-4 4.3.2 Water Bad Debt................................................................................................4-5 4.3.3 Water Payment In Lieu of Taxes......................................................................4-5 4.3.4 Safe Drinking Water Fee Reimbursement........................................................4-5 4.3.5 Water Debt Service Requirements...................................................................4-6 4.3.6 Transfer to Shop Fund......................................................................................4-6 4.3.7 Transfer to Operating Reserve.........................................................................4-6 4.3.8 Water Cash Financed Capital...........................................................................4-6 4.3.9 Transfer to Capital Reserve..............................................................................4-6 4.4 Water Proposed Revenue Adjustments...........................................................................4-6 BLACK & VEATCH I Table of Contents Page 148 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5 Water Cost of Service......................................................................................................4-8 4.5.1 Determination of Cost of Service.....................................................................4-8 4.5.2 Determination of Functional Costs..................................................................4-9 4.5.3 Allocation of Costs to the Functional Cost Components...............................4-10 4.5.4 Distribution of Water Utility Costs to Customer Classes...............................4-11 5.0 Water Rate Design............................................................................................................5-14 5.1 Existing Water Rates......................................................................................................5-14 5.2 Proposed Water Rates...................................................................................................5-14 6.0 Wastewater Utility..............................................................................................................6-1 6.1 Wastewater Revenue Projections Under Existing Rates.................................................6-1 6.1.1 Wastewater Revenue Under Existing Rates.....................................................6-1 6.1.2 Projection of Service Revenue Under Existing Rates.......................................6-3 6.1.3 Other Wastewater Revenue.............................................................................6-3 6.2 Wastewater Capital Improvements Program..................................................................6-4 6.3 Wastewater Utility Revenue Requirements....................................................................6-4 6.3.1 Wastewater Operation and Maintenance Expenses.......................................6-4 6.3.2 Wastewater Bad Debt......................................................................................6-5 6.3.3 Wastewater Payment In Lieu of Taxes.............................................................6-5 6.3.4 Wastewater Debt Service Requirements.........................................................6-6 6.3.5 Transfer to Shop Fund......................................................................................6-6 6.3.6 Transfer to Operating Reserve.........................................................................6-6 6.3.7 Wastewater Cash Financed Capital..................................................................6-6 6.3.8 Transfer to Capital Reserve..............................................................................6-6 6.4 Wastewater Proposed Revenue Adjustments.................................................................6-6 6.5 Wastewater Cost of Service.............................................................................................6-8 6.5.1 Determination of Cost of Service.....................................................................6-8 6.5.2 Determination of Functional Costs..................................................................6-9 6.5.3 Allocation of Costs to the Functional Cost Components.................................6-9 6.5.4 Distribution of Wastewater Utility Costs to Customer Classes ......................6-11 6.5.5 Wastewater Utility Customer Class Costs of Service.....................................6-12 7.0 Wastewater Rate Design...................................................................................................7-14 7.1 Existing Wastewater Rates............................................................................................7-14 7.2 Proposed Wastewater Rates.........................................................................................7-14 8.0 Combined Water and Wastewater Utilities........................................................................8-15 9.0 Disclaimer.........................................................................................................................9-16 10.0 Appendix 1: Water Tables.................................................................................................10-1 11.0 Appendix 2: Wastewater Tables........................................................................................11-1 BLACK & VEATCH I Table of Contents ii Page 149 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study LIST OF EXECUTIVE SUMMARY TABLES Table ES - 1—Water 2022 Cost of Service............................................................................................. ES 1-2 Table ES - 2 —Wastewater 2022 Cost of Service................................................................................... ES 1-3 LIST OF FIGURES Figure 4-1 - Historical and Projected Water Accounts...............................................................................4-2 Figure 4-2 - Historical and Projected Water Billed Volume.......................................................................4-3 Figure 4-3 - Historical and Projected Water Service Revenue...................................................................4-3 Figure 4-4 - Projected Annual Water O&M Expenses................................................................................4-5 Figure 4-5 - Water Revenues and Revenue Requirements........................................................................4-7 Figure 6-1 - Historical and Projected Wastewater Accounts.....................................................................6-2 Figure 6-2 - Historical and Projected Wastewater Billed Volume.............................................................6-3 Figure 6-3 - Historical and Projected Wastewater Service Revenue.........................................................6-3 Figure 6-4 - Projected Annual Water O&M Expense.................................................................................6-5 Figure 6-5 - Wastewater Revenues and Revenue Requirements..............................................................6-7 LIST OF WATER TABLES Table W - 1 - Water Projected Number of Accounts...............................................................................10-1 Table W - 2 - Water Projected Billed Volume (1,000 Gallons).................................................................10-2 Table W - 3 - Water Existing Rates...........................................................................................................10-3 Table W - 4 - Water Projected Revenues Under Existing Rates...............................................................10-4 Table W - 5 - Water Projected Other Revenues.......................................................................................10-4 Table W - 6 - Water Capital Improvement Program................................................................................10-5 Table W - 7 - Water Projected O&M Expenses........................................................................................10-5 Table W - 8 - Capital Program Financing..................................................................................................10-6 Table W - 9 - Water Operating Cash Flow................................................................................................10-7 Table W - 10 - Water Fund Balances........................................................................................................10-8 Table W - 11 - Water 2022 Cost of Service..............................................................................................10-9 Table W - 12 - Water 2022 Allocation of Net Plant Investment to Functional Cost Components ........10-10 Table W - 13 - Water 2022 Allocation of Net Annual Depreciation to Functional Cost Components.................................................................................................................10-10 Table W - 14 - Water 2022 Allocation of O&M Expenses to Functional Cost Components ..................10-10 Table W - 15 - Water 2022 Estimated Units of Service..........................................................................10-11 Table W - 16 - Water 2022 Unit Cost of Service....................................................................................10-12 Table W - 17 - Water 2022 Cost of Service by Customer Class..............................................................10-13 Table W - 18 - Water Proposed 2022 Rates...........................................................................................10-14 Table W - 19 - Water 2022 Cost of Service Under Proposed Rates.......................................................10-15 Table W - 20 - Water 2022 Bill Impact...................................................................................................10-16 BLACK & VEATCH I Table of Contents iii Page 150 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study LIST OF WASTEWATER TABLES Table S - 1 - Wastewater Projected Accounts..........................................................................................11-1 Table S - 2 - Wastewater Projected Billed Volume (1,000 Gallons).........................................................11-1 Table S - 3 - Wastewater Existing Charges...............................................................................................11-2 Table S - 4 - Wastewater Projected Revenues at Existing Rates..............................................................11-3 Table S - 5 - Wastewater Projected Other Revenues...............................................................................11-3 Table S - 6 - Wastewater Capital Improvement Program........................................................................11-4 Table S - 7 - Wastewater Projected O&M Expenses................................................................................11-4 Table S - 8 - Wastewater Cash Financed Capital......................................................................................11-5 Table S - 9 - Wastewater Operating Cash Flow........................................................................................11-5 Table S - 10 - Wastewater Projected Fund Balances...............................................................................11-6 Table S - 11- Wastewater 2022 Cost of Service......................................................................................11-6 Table S - 12 - Wastewater 2022 Allocation of Net Plant Investment......................................................11-7 Table S - 13 - Wastewater 2022 Allocation of Depreciation....................................................................11-7 Table S - 14 - Wastewater 2022 Allocation of O&M Expenses................................................................11-8 Table S - 15 - Wastewater 2022 Units of Service.....................................................................................11-8 Table S - 16 - Wastewater 2022 Unit Cost of Service..............................................................................11-9 Table S - 17 - Wastewater 2022 Cost of Service by Customer Class........................................................11-9 Table S - 18 - Wastewater Proposed 2022 Charges...............................................................................11-10 Table S - 19 - Wastewater 2022 Cost of Service Under Proposed Rates...............................................11-11 Table S - 20 - Wastewater 2022 Bill Impact...........................................................................................11-11 LIST OF COMBINED TABLES Table C - 1 - Combined Projected Fund Balances Table C - 2 - Combined Operating Cash Flow...... Table C - 3 - Combined 2022 Bill Impact ............. BLACK & VEATCH I Table of Contents iv Page 151 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 1.0 Executive Summary The City of Fayetteville (City) provides water and wastewater services to retail and wholesale customers. The Water and Wastewater fund is an Enterprise Fund, which is funded by the operating and capital revenues from the users of the system. Due to multiple factors including increasing operating costs, significant capital investments to meet regulatory requirements, and the need for infrastructure rehabilitation and replacement, revenues under existing rates are not adequate to meet the annual revenue requirements. Therefore, to maintain financial sufficiency and to assure equitable cost recovery, the City engaged Black & Veatch Management Consulting, LLC (Black & Veatch) to perform a Water and Wastewater Comprehensive Rate Study (Study). The primary objectives of the Study are to develop a balanced financial plan, determine cost of service allocations for each customer class and design rates to recover costs from customer classes in reasonable accord with the allocated costs of service. The financial plan was developed for the six -year period of 2021 through 2026, also referred to as the study period or the forecast period. The city's fiscal year is a calendar year, starting on January 1 and ending on December 31. As a result of our evaluations and analyses, the following summary of findings and recommendations are offered for the City's consideration. 1.1 Summary of Findings 1.1.1 Revenue Under Existing Rates 1. The City provides retail water services to approximately 40,800 customers inside the City and about 7,000 customers outside the City. The number of retail water service customers inside the City is projected to increase to about 44,800 by 2026 and the number of outside City water customers is projected to increase to about 8,000. The City also provides treated water to four wholesale customers. Retail wastewater collection and treatment service is provided to approximately 36,900 customers inside the City and about 2,600 customers outside the City. The number of inside City wastewater service customers is projected to increase to about 40,600 by 2026 and the number of outside City wastewater service customers is projected to increase to about 2,700. 2. Treated water sales to inside City retail customers are projected to increase from approximately 3,146,800 1,000 gallons (kgals) in 2021 to approximately 3,388,000 kgals by 2026. Treated water sales to outside City retail customers are projected to increase from approximately 507,600 kgals in 2021 to approximately 519,400 kgals by 2026. Treated water sales to wholesale customers is projected to be approximately 219,100 kgals in 2021 and decrease to 202,300 kgals in 2022 and remain at that level through 2026. Billed wastewater volume from inside City retail customers is projected to increase from approximately 2,806,700 kgals in 2021 to approximately 2,961,800 kgals by 2026. Billed wastewater volume from outside City retail customers is projected to increase from 109,800 kgals in 2021 to about 117,400 kgals by 2026. Billed wastewater volume from wholesale customers is projected to increase from 81,000 kgals in 2021 to 126,600 kgals in 2026 due to the addition of West Fork as a wholesale wastewater customer starting December 2020. The annual wholesale wastewater volume is projected to remain at the 2021 level through 2026. BLACK & VEATCH I Executive Summary ES-1-0 Page 152 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 3. The City's current water rates became effective January 1, 2022. For both retail and wholesale customers, the water rates include a monthly base charge, which varies by meter size and a volume charge that varies by customer class. The existing schedule of rates for wastewater service became effective on January 1, 2022. For retail customers, the wastewater rates include a monthly base charge, which varies by meter size. The volume charge varies by customer class. Surcharge rates are based on excess strength of Biochemical Oxygen Demand (BOD) and Total Suspended Solids (TSS). The existing wastewater rate structure is described in Section 3.3.2. 4. Revenue is currently derived principally from charges for treated water and wastewater service, with some revenue also obtained fire protection charges and other miscellaneous sources. Revenue from treated water sales, under existing rates, is projected to increase from $21,186,400 in 2021 to about $22,986,800 in 2026, reflecting a 5-year cumulative increase of 8%. Miscellaneous water revenues are estimated to increase from $1,484,700 in 2021 to approximately $1,608,600 in 2026, reflecting a 5-year cumulative increase of 8%. Revenue for wastewater collection and treatment services is projected to increase from $24,461,900 in 2021 to about $26,697,600 in 2026, under existing rates, reflecting a 5-year cumulative increase of 9%. Miscellaneous wastewater revenue is estimated at $1,297,100 in 2021 and $1,420,200 per year through 2022 to 2026, reflecting a 5-year cumulative increase of 9%. 1.1.2 Revenue Requirements 1. Costs of service to be recovered from water and wastewater service charges include (1) operation and maintenance (O&M) expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) Safe Drinking Water Fee Reimbursement; (5) debt service (consisting of principal and interest payments); (6) transfer to shop fund; (7) transfer to operating reserve; (8) cash financed capital; and (9) transfer to capital reserve. The water and wastewater utilities do not have any outstanding debt service. There are no future debt issuances are planned over the study period and no transfers to the shop fund over the study period. 2. The annual O&M expense includes the cost of labor, materials, power, chemicals, purchased water, contract services and other expenses associated with each utility's operation. In this study, FY 2021 is defined as the base budget year, based on which the O&M costs are projected for the forecast period. 0&M expense for the water utility is projected to increase from $15,949,600 in 2021 to $18,739,400 by 2026 due to the combined effects of inflation and system growth. O&M expense for the wastewater utility is projected to increase from $15,674,800 in 2021 to $18,395,700 by 2026 due to the combined effects of inflation and system growth. 3. Bad debt expenses refer to outstanding balances from customers that are deemed uncollectible. The water and wastewater bad debt in 2019 was 0.5% of revenue. Bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for water utility is projected to increase from $105,900 in 2021 to $129,000 by 2026. Annual bad debt expenses for wastewater utility is projected to increase from $122,300 in 2021 to $149,900 by 2026. 4. The Payment In Lieu of Taxes (PILOT) are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires the water and wastewater funds to pay 4.25% of annual total gross sales revenues to the City. Annual PILOT amount for the water utility is anticipated to increase from $900,400 in 2021 to $1,096,900 in 2026. Annual BLACK & VEATCH I Executive Summary ES-1-1 Page 153 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study PILOT amount for the wastewater utility is projected to increase from $1,039,600 in 2021 to $1,274,000 in 2026. 5. The Safe Drinking Water Fee (SDWF) revenue collected for each metered customer is reimbursed to the state of Arkansas Department of Public Health. The SDWF reimbursement is projected to increase from $230,000 in 2021 to $250,200 in 2026. The SDWF is a pass -through fee and is treated as a "revenue reduction" by the City. 6. The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve for the water utility is projected to increase from $133,000 in 2022 to $151,800 in 2026. The transfer to operating reserve for wastewater is projected to increase from $129,600 in 2022 to $147,900 in 2026. 7. The City currently utilizes the following two sources of funding for the water and wastewater utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. A capital project meets the requirements of using impact fees if the existing water or wastewater capacity is expanded due to growth. The wastewater capital improvement program for the study period is $69 million, of which $67 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. 1.1.3 Summary of Cash Flow Results 1. The cash flow analysis performed based on the projected annual revenues under existing rates and the projected annual revenue requirements indicates a funding gap for both utilities beginning in 2021. Therefore, a series of 3% annual revenue adjustment is needed in both the water and wastewater utilities to achieve the goal of the operating fund revenues being self-sufficient and adequate to cover all of the O&M expenses, cash financing of the capital program, required transfers, and to maintain the minimum reserve requirements. Table W - 9, in Appendix 1 presents the cash flow analysis and the proposed series of revenue increases for the water utility, and Table S - 9, in Appendix 2 presents the same for the wastewater utility. 1.1.4 Cost of Service Analysis 1. The revenue requirements less any revenues from other sources provides the "net" annual operating fund revenue requirements (also referred to as "cost of service") that needs to be recovered through user rates and charges. A summary of the projected annual cost of service for 2022 is shown for water and wastewater in tables ES-1 and ES-2, respectively. Table ES - 1—Water 2022 Cost of Service O&M Expenses Depreciation Return Net Cost of Service 17,231,900 17,231,900 2,672,900 2,672,900 1,895,900 1,895,900 17,231,900 4,568,800 21,800,700 BLACK & VEATCH I Executive Summary ES-1-2 Page 154 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table ES - 2 —Wastewater 2022 Cost of Service 1 O&M Expenses 2 Depreciation 3 Return 4 Net Cost of Service 16,801,000 16,801,000 8,060,600 8,060,600 567,200 567,200 16,801,000 8,627,800 25,428,800 2. As a basis for design of a schedule of water and wastewater rates, the costs of service are allocated to the classes of customers in accordance with respective service requirements of each customer class. The resulting costs of service allocated to customer classes are summarized in Table W - 17 for water and Table S - 17 for wastewater. 1.2 Proposed Recommendations Based on the financial planning and cost of service analysis performed for the study period, the Black & Veatch team proffers the following series of recommendations: 1. Implement a series of 3% annual revenue increase from 2022 to 2026 for both water and wastewater utilities. 2. Implement cost of service -based rates for water and wastewater utilities in 2022. 3. Transition the existing monthly Base charge to the proposed Base Charge, derived based on cost of service, if cost of service based proposed Base Charge is greater than the existing Base charge. 4. Eliminate the minimum volume charge billing of 1,000 gallons from the volumetric portion of the rate structure. 5. Continue with the existing tier block structure for customer classes that have an inclining block (residential) or a uniform block (industrial) for the volumetric rate structure. 6. Change to uniform block for customers that currently have a declining block (non-residential and irrigation) volumetric rate structure. The aforementioned recommendations enable the water and wastewater utilities to meet all its financial obligations, so that the City can continue to provide reliable service to serve the needs of existing and future customers. 1.3 Disclaimer This report was prepared for the City of Fayetteville (Client) by Black & Veatch Management Consulting, LLC (Black & Veatch) and is based on information provided by the Client not within the control of Black & Veatch. While it is believed that the information, data and opinions contained herein will be reliable BLACK & VEATCH I Executive Summary ES-1-3 Page 155 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study under the conditions and subject to the limitations set forth in this report, Black & Veatch does not guarantee the accuracy thereof. Black & Veatch has assumed that the information provided by others, both verbal and written, is complete and correct. The projections set forth in this report are intended as "forward -looking statements." In formulating these projections, Black & Veatch has made certain assumptions with respect to conditions, events, and circumstances that may occur in the future. While Black & Veatch believes the assumptions are reasonable actual results may differ materially from those projected, as influenced by the conditions, events, and circumstances that occur. As such, Black & Veatch does not take responsibility for the accuracy of data or projections provided by or prepared on behalf of the Client, nor does Black & Veatch have any responsibility for updating this report for events occurring after the date of this report. Use of this report or any information contained therein by any party other than the Client, shall constitute a waiver and release by such third party of Black & Veatch from and against all claims and liability, including but not limited to liability for special, incidental, indirect or consequential damages in connection with such use. Such use of this report by a third party shall constitute agreement by the third party user that its rights, if any, arising from this report shall be subject to the terms of this Report Limitations, and in no event shall the third party's rights, if any, exceed those of the Client under its contract with B&V. The benefit of such releases, waivers, or limitations of liability shall extend to the related companies and subcontractors of any tier of B&V, and the shareholders, directors, officers, partners, employees, and agents of all released or indemnified parties. BLACK & VEATCH I Executive Summary ES-1-4 Page 156 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 2.0 Introduction The City of Fayetteville water utility provides treated water and water distribution services to approximately 40,800 customers within the corporate limits of Fayetteville, and to approximately 7,000 customers in areas contiguous to, but outside of the City's corporate limits. The wastewater utility provides retail wastewater collection and treatment service to approximately 37,000 customers within the corporate city limits and to approximately 2,600 customers outside of the City's corporate limits. The City also provides treated water to four wholesale customers and wastewater treatment to two wholesale customers. In providing water and wastewater service, the City incurs considerable expense related to the ongoing operating and capital needs of the utilities. These operating and capital expenditures tend to increase annually due to the combined effects of inflation and the need to repair, replace, or extend existing service facilities to meet customer service requirements, as well as to meet more stringent state and federal water quality requirements and EPA requirements. The City of Fayetteville, recognizing the importance of financial planning and cost of service analysis to equitably recover the increasing costs to replace, renew, expand, improve, and operate its water and wastewater service facilities, retained Black & Veatch to perform this comprehensive study of revenue requirements, cost of service, and rates for potable water service and wastewater service. 2.1 Purpose This report examines the respective projected revenue and rate requirements of the water and wastewater systems of the City. The purpose of this report is (1) to project the future revenues of the water and wastewater utilities under existing rates and charges, as well as the operating expenses and capital financing revenue requirements of the two utilities, and to examine the adequacy of projected revenues to meet these revenue requirements through calendar year 2026; (2) to allocate these revenue requirements, or costs of service, for a representative test year to the various customer classes in accordance with the respective service requirements that each class places on the systems; and (3) to develop a suitable schedule of water and wastewater rates that will produce revenues adequate to meet the financial needs of the utility on a basis that recognizes customer costs of service, existing wholesale service agreements and practical bill impact considerations. 2.2 Scope This report presents the results of a comprehensive study of the projected revenue and revenue requirements, costs of service allocations, and proposed rates for treated water and wastewater service. Revenue and revenue requirements are projected for the five calendar years from 2022 through 2026, recognizing anticipated growth in number of customers, water use, and wastewater flows throughout the service area. The study of revenue requirements recognizes projected operation and maintenance expense, capital improvement requirements met from revenues, principal and interest payments on outstanding and proposed bond issues, and reserve fund requirements. Requirements of existing revenue bond indentures are also recognized. Costs of treated water and wastewater service are developed for each group of customers and type of service based on consideration of utility revenue needs and projected customer service requirements. Rate adjustments are designed for retail and wholesale customers in accordance with allocated costs of service, wholesale service agreement terms, and customer bill impact considerations. BLACK & VEATCH I Introduction 2-0 Page 157 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 2.3 Study Methodology The development of user rates and charges requires the integration of three critical components: (i) financial plan; (ii) cost of service allocations; and (iii) rate design. 2.3.1 Financial Plan The development and update of a financial plan is necessary to continue to focus on financial discipline, build financial stability, and maintain sustainable financial planning Financial Planning practices. The financial planning process helps to establish a financial roadmap to meet all of the water and wastewater utility's obligations. As illustrated in Figure 2 - 1, the key components of a financial plan are: (i) projection of revenues from user rates and other sources; (ii) development of a capital financing plan to decide the mix of debt and cash funding of capital program; (iii) projection of revenue requirements (O&M and capital costs, and target reserves); and (iv) determination of the level and timing of revenue adjustments needed to maintain financial viability. The annual revenue requirements are typically developed on a cash - needs basis for public utility rate setting. The revenue requirements, under the cash -needs basis approach, include the following: Project Revenues Review Project Pro -Forma Revenue Requirements Scenario ------------ Planning E Develop Capital % Rev Financing Plan Adjustments Figure 2 - 1: Financial Plan O&M expenditures; Debt service expenses; Cash financing of capital program; Contributions to operating reserves; and Other obligations such as payments and transfers for specific purposes. To establish financial stability, a financial plan is typically prepared for a multi -year period. A six -year financial plan was developed for the water and wastewater utility to achieve the financial objectives and target metrics defined to build and sustain financial integrity. 2022 through 2026 is the forecast period for both revenues and revenue requirement projections. The revenue adjustments represent the level of annual revenue increases necessary to meet the annual net revenue requirements. 2.3.2 Cost of Service Cost of service can be described as the revenue that the water and wastewater utility need to generate, net of funding from other miscellaneous sources of revenues. Therefore, Cost of Service is essentially the "net revenue requirement" that is to be recovered through user rates and charges. As illustrated in Figure 2 - 2, Cost of LCost of Service Analysis All locate Costs Develop Units Unit Costs of Service Distribute Allocated Costs Based on Service Requirements Figure 2 - 2: Cost of Service service analysis enables an equitable apportioning of the net annual revenue requirements (also referred to as cost of service) to the various cost components and customer BLACK & VEATCH I Introduction 2-1 Page 158 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study classes. The level and types of allocation performed depend on the existing and anticipated rate structure. As municipal utilities are public utilities that cannot make a profit, the equitable allocation of costs is a critical step that is necessary to establish a reasonable nexus between costs incurred in providing service and the fees charged from customers, and to establish defensible user rates and charges. 2.3.3 Rate Design The third and final component is an evaluation of the existing rate structure components and the development of proposed user rates and charges. The user rates and charge schedules typically include fixed charge, volumetric charge, and other special charge rate components. As illustrated in Figure 2 - 3, the rates and charges are designed to recover the annual cost of service allocated to these different rate components and based on local policy and practical considerations. The study methodology described above and used in the financial planning, cost of service and rate design analysis reflect the application of industry accepted rate setting approaches that are provided in the following two guidance manuals: American Water Works Association (AWWA) Manual M-1: Principles of Water Rates, Fees, and Charges for water rate setting; and Rate Design Review Develop COS 1 Rates Scenario Planning Develop Practical Rates Proposed ----------------------------------- Rates Figure 2 - 3: Rate Design Water Environment Foundation (WEF) Financing and Charges for Wastewater Systems for wastewater. BLACK & VEATCH I Introduction 2-2 Page 159 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 3.0 Rate Structure Overview The revenue requirements of a water and wastewater utility, net of any miscellaneous sources of revenues, are recovered from user rates and charges. A water rate structure usually consists of two primary components, namely, a fixed charge and a volumetric charge. Similarly, a wastewater rate structure more commonly consists of a fixed charge, a volumetric charge, and pollutant charge (for wastewater pollutants such as Bio-chemical Oxygen Demand (BOD) and Total Suspended Solids (TSS). Occasionally, a utility's water and wastewater rate structures may include special surcharges and/or special assessments to recover costs associated with certain service situations such as purchased water, pumping to elevations, drought conditions, readiness -to -serve, environmental conditions, and extra - strength wastewater discharges. 3.1 Fixed Charge A utility's annual revenue requirements comprise mostly of fixed costs such as salaries and benefits, pension obligations, debt service, cash financing for infrastructure renewal, and costs related to the provision of adequate capacity for service. These types of fixed costs occur on a recurring basis regardless of the amount of water used by the customer. Therefore, rate structures need to afford the ability to recover at least some of the fixed costs based on billing parameters that are not related to water usage or wastewater flow. The fixed charge, which is assessed regardless of the volume of water used, provides a mechanism to reliably recover some of the fixed annual operating costs of the utility, and provide for some level of revenue stability. In the utility industry, fixed charges are designed to recover one or more of the following types of costs, namely, (i) metering; (ii) billing; (iii) readiness -to -serve cost; (iv) specific capital investment; and (v) other specific costs. The costs of providing these functions vary among types of customers and/or by factors such as size and capacity of the meters. Therefore, to provide for equitable cost recovery, water and wastewater fixed charges are usually assessed based on meter size and also by customer class. 3.2 Volumetric (Usage) Charge In the utility industry, usage charges are designed to recover all other costs (except those that are recovered through fixed charge) associated with the treatment and delivery of water service and the collection, treatment, and disposal of wastewater. The three common types of volumetric charge are: (i) inclining block rate, where the usage in the next higher usage block is priced at a higher rate per unit; (ii) uniform block rate, where all units of usage are priced at the same unit rate; and (iii) declining block rate, where the usage in the next higher usage block is priced at a lower rate per unit. As usage patterns vary among customer classes and consequently different classes place different levels of service demands, different volumetric rates can be established for the various customer classes. In designing the volumetric rate structure, practical considerations including conservation, equity, affordability, and ease of administration are addressed. 3.3 Existing Rate Structure 3.3.1 Water Rate Structure Consistent with industry rate structures, the City's water rate structure comprises of both Fixed Charge and Volumetric Charge components. The water rate structure includes the following two components: BLACK & VEATCH I Rate Structure Overview 3-0 Page 160 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Base Charge (Fixed Charge); and Volume Charge (Volumetric Charge). Some of these components are applicable to only specific customer classes. The revenues derived from the above charges are collectively referred to as water Service Kevenues. ■ Base Charge: The existing Base Charge for all customer classes is based on meter size. ■ Volume Charge. The existing Volume Charge is based on the quantity of water used by the customers. ■ Safe Drinkine Water Fee• This is a regulatory charge per bill that is collected by the City on behalf of the state of Arkansas Department of Public Health. The customer classes to which the specific charge components apply is illustrated in Figure 3 - 1. The existing water rate schedule for 2021, for these rate components, is presented in Table W - 3 in Appendix 1. All customers are billed monthly. Figure 3 -1: Existing Water Rate Structure Base Charge by Meter Size • Retail Inside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Retail Outside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Wholesale Volume Rate (3-Tier Inclining Block) Minimum Usage (1,000 Gallons) Volume Rate (2-Tier Declining Block) Minimum Usage (1,000 Gallons) Volume Rate (Uniform) Minimum Usage (1,000 Gallons) • Volume Rate ( Uniform) 2 rates (Reduced Peak Demand and Peak Demand) Safe Drinking Water Fee (per month) 3.3.2 Wastewater Rate Structure Retail Inside City Residential; and Retail Outside City Residential Retail Inside City Non -Residential, Irrigation; and Retail Outside City Non -Residential, Irrigation Retail Inside City Major Industrial Retail Outside City Major Industrial Wholesale All customer classes The City's Operating Fund wastewater rate structure also comprises of both Fixed Charge and Volumetric Charge components. The wastewater rate structure includes the following three components: Base Charge (Fixed Charge); BLACK & VEATCH I Rate Structure Overview 3-1 Page 161 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Volume Charge (Volumetric Charge); and BOD and TSS Charge (Surcharge). The revenues derived from all these three sources are collectively referred to as "Wastewater Service Revenues. Some of these user rate components are applicable to only specific customer classes. ■ Base Charge: The existing Base Charge for all retail customers is based on meter size. ■ Volume Charge. The existing volume wastewater charge is based on the quantity of water used by the customer classes. Surcharge: The existing wastewater surcharge is based on the excess strengths of BOD and TSS, of certain customers. The customer classes to which the specific rate components are applicable is illustrated in Figure 3 - 2. The existing wastewater rate schedule for 2021 is presented in Table S - 3 in Appendix 2. Figure 3 - 2: Existing Wastewater Rate Structure • Base Charge by Meter Size Retail Inside City (Residential, Non -Residential and Major Industrial); Retail Outside City (Residential, Non -Residential and Major Industrial); Volume Rate (2-Tier Inclining Block) Retail Inside City Residential Based on winter water usage of December, January and February • Volume Rate (Uniform) Retail Inside City (Non -Residential and Major Industrial) Retail Outside City (Residential, Non -Residential and Major Industrial) Volume Rate ( Uniform) Wholesale 2 tiered rates (85% of metered water usage and Above 85% of metered water usage) BLACK & VEATCH I Rate Structure Overview 3-2 Page 162 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.0 Water Utility The financial plan and rate design were developed to meet all the funding obligations of the water utility, and to achieve the financial adequacy and equitable cost recovery discussed in Section 2.3. The water utility financial plan was developed for the six -year forecast period of 2021 through 2026, and includes the following key components: Revenue projections (user rate revenues and non -rate revenues); Capital improvement program financing; Annual revenue requirement projections; and Annual proposed revenue increases 4.1 Water Revenue Projections Under Existing Rates The water utility revenues are derived from the following sources: Water Service Revenues (Base and Volume Charge) Other Revenues As a first step in the development of the financial plan, Water Service Revenues under the 2022 existing rates are projected for the forecast period. 4.1.1 Water Revenue Under Existing Rates As described in Section 3.3.1, the Water Service Revenue consists of two charge components. For each of the two components, revenues are projected based on billing units and applicable existing rate schedules. The billing units necessary to compute the Base Charge revenues are the number of accounts based on meter size and customer class. The billing units necessary to compute the Volume Charge are the annual water usage by customer class and by applicable blocks of usage. 4.1.1.1 Projection of Customer Accounts Typically, historical billing units are reviewed and used to project billing units for the forecast period. The project team reviewed historical accounts and average usage trends for each customer class referenced in Section 3.3.1. Based on the review of historical trends, two annual adjustment factors were applied to project billing units for the forecast period. The two adjustment factors applied at the customer class level are accounts growth rate and usage factor. The number of accounts is projected to grow in all customer classes except for Fire protection and wholesale where the number of accounts is anticipated to remain at the 2020 level. The total number of water accounts (not including private fire connections) is anticipated to increase from about 48,620 in 2021 to about 52,850 in 2026, at an overall annual system growth rate of 1.7%. The number of private fire connections is anticipated to remain at 727 throughout the study period. Table W - 1 in Appendix 1 presents the projected annual number of water accounts and private fire connections for the period of 2021 through 2026. BLACK & VEATCH I Water Utility 4-1 Page 163 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 4-1 presents both the historical and projected number of accounts for the water utility. Water Utility Historical and Projected Accounts 60,000 50,000 — — — — — — 40,000 30,000 20,000 10,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 4-1- Historical and Projected Water Accounts 4.1.1.2 Projection of Water Usage Billed water volumes are projected based on estimates of the number of water accounts and the average billed usage per account. Average water use per account is determined based on historical usage. The historical usage per account for all customer classes varies each year between 2016 and 2020. In 2020, the COVID pandemic led to stay-at-home measures and shut down of non -essential businesses across the country. Consequently, the residential customers used more water in 2020, whereas the non-residential customers used less water as compared to previous years. The average use per account for 2021 was projected to remain at the 2020 levels assuming a lingering effect of the pandemic. The average usage per account for 2022 and beyond was projected to return to the 2019 level for all customer classes assuming a return to pre -pandemic levels. Total system water usage is projected to increase from 3,873,500 kgals in 2021 to 4,109,400 kgals in 2026. Table W - 2 in Appendix 1 presents the projected annual volume for the period of 2021 through 2026. Figure 4-2 presents both the historical and projected annual billed volume for the water utility. Water Utility Historical and Projected Billed Volume (1,000 Gallons) 4,200,000 4,100,000 4,000,000 3,900,000 3,800,000 3,700,000 3,600,000 3,500,000 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected BLACK & VEATCH I Water Utility 4-2 Page 164 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 4-2 - Historical and Projected Water Billed Volume 4.1.2 Projection of Service Revenue Under Existing Rates Water service revenues for the period 2021 through 2026 are projected for each charge component (base and volume) based on the projections of accounts by meter size, projected water usage for each customer class, and the application of the 2021 rate schedule for 2021 revenues and 2022 rate schedule for 2022 through 2026 revenues. Water service revenue under existing rates is projected to increase slightly from $21.2 million in 2021 to $23.0 million in 2026. This growth is due to increase in water sales due to the growth in the number of accounts over the study period. Table W - 4 in Appendix 1 presents the projected annual service revenues for the period of 2021 through 2026. Figure 4-3 presents both the historical and projected annual service revenues under existing rates for the water utility. Water Utility Historical and Projected Service Revenues (Under Existing Rates) $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 4-3 - Historical and Projected Water Service Revenue 4.1.3 Other Water Revenues The other revenues include the following major components: Impact Fee Revenue; Water/Rural Water Connection Fees; Miscellaneous Fees (Water Sales Not on Computer, Trip Fees, Tampering -Billed Service) Penalties; and Safe Drinking Water Fee (pass -through) The annual revenues from water impact fees, water connection fees and miscellaneous fees for 2021 to 2026 are projected based on historical three-year (2018 to 2020) average revenues for each of the fees. The penalties revenue in 2020 reflects only the first two and half months of revenues, as the City stopped assessing penalties for non-payment due to the pandemic. The revenue for penalties in 2021 is projected to be half of the historical three -year (2017 to 2019) average revenues due to continued waiver of the penalties as a result of the COVID pandemic during the first half for 2021. The revenue BLACK & VEATCH I Water Utility 4-3 Page 165 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study from penalties in 2022 and beyond is projected as the historical three-year average (2017 to 2019) average revenues. Table W - 5 in Appendix 1 presents the historical and projected annual service revenues for the period of 2021 through 2026. The Safe Drinking Water Fee (SDWF) is assessed for all water users in the state of Arkansas. The current rate is $0.40 per bill per month and is collected by all water utilities in the state. The SDWF revenue is projected by applying the current rate to the number of meters for the period 2021 to 2026. The revenue collected as part of this fee is reimbursed to the state. 4.2 Water Capital Improvements Program The capital project costs provided by the City were based on 2020 dollars. Based on discussions with the City, the project costs are inflated at an annual rate of 3.0% to accurately reflect the costs of projects for 2021 and beyond. The water utility Capital Improvement Plan (CIP) provides for a total of $49.0 million of investments during the study period of 2021 through 2026. Table W - 6 in Appendix 1 presents the CIP list of projects and schedule for 2021 through 2026 The CIP is expected to be financed from a funding mix of cash financing from service revenue and impact fees. 4.3 Water Revenue Requirements Projection of reliable revenue requirements includes: (1) operation and maintenance expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) SDWF Reimbursement; (5) debt service (consisting of principal and interest payments); (6) transfer to shop fund; (7) transfer to operating reserve; (8) cash financed capital; and (9) transfer to capital reserve. The projections of annual revenue requirements for the study period is discussed in this section. 4.3.1 Water Operation and Maintenance Expenses The O&M expenses for the water utility include the annual expenses associated with the water purchases from Beaver Water District; storage and distribution; meters and services; billing and collection, and general administrative services. These expenses include personnel costs (salaries and benefits), costs for materials and supplies, costs of utilities, and contracted services. The 2021 O&M budget provided by the City was used as the baseline for projection of O&M expenses for the study period. In addition, costs associated with a water inspector (not included in the 2021 budget) recurring salary and benefits costs, recurring vehicle maintenance costs and one-time cost of the vehicle purchase was added per City's direction. Based on historical O&M costs, industry experience, and discussions with the City management, appropriate escalation factors were applied to various categories of costs to project future annual 0&M expenses. Annual escalation factors used for major cost categories include the following: Salaries: 4.00% Benefits: 5.00% Energy: 3.00% Chemicals: 3.00% h6 Purchased Water: 3.00% BLACK & VEATCH I Water Utility 4-4 Page 166 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The annual O&M expenses for water utility are budgeted at $15.9 million in 2021 and are projected to grow to $18.8 million by 2026. Table W - 7 in Appendix 1 presents a summary of total projected operation and maintenance expense for the period 2021 through 2026. Figure 4-4 presents the historical and projected O&M expenses for the water utility. Water Utility Historical and Projected O&M Expenses 825,000,000 s20,000,00o 515,000,000 ........ sio,00a,000 55,000,000 So 2020 2021 2022 2023 2024 2025 Historical — — Projected Figure 4-4 - Projected Annual Water O&M Expenses 4.3.2 Water Bad Debt Bad debt expenses refer to outstanding balances owed that are deemed uncollectible. The water bad debt in 2019 was 0.5% of revenue. Hence, bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for water utility is projected to increase from $105,900 in 2021 to $129,500 by 2026 reflecting the increase in projected revenues. Line 12 in Table W - 9 in Appendix 1 presents the projected bad debt for the period 2021 through 2026. 4.3.3 Water Payment In Lieu of Taxes The PILOT costs are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires that the water and wastewater funds to pay 4.25% of annual total gross sale revenues to the City. Annual PILOT amount for the water utility is calculated by multiplying actual water revenues from prior year (Water sales on Computer and Water sales not on Computer/ Bulk Water Sales, and Fire Hydrant and Protection). Annual PILOT amount for the water utility is anticipated to increase from $900,400 in 2021 to $1,100,700 in 2026. Line 13 in Table W - 9 in Appendix 1 presents the projected PILOT expenses for the period 2021 through 2026. 4.3.4 Safe Drinking Water Fee Reimbursement The SDWF revenue collected for each metered customer is reimbursed to the state of Arkansas department of Public Health. The SDWF reimbursement is projected to increase from $230,000 in 2021 to $250,200 in 2026. Line 14 in Table W - 9 in Appendix 1 presents the projected SDWF reimbursement for the period 2021 through 2026. BLACK & VEATCH I Water Utility 4-5 Page 167 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.3.5 Water Debt Service Requirements The water utility does not have any outstanding debt service obligations. The City does not anticipate any debt issuances during the study period, therefore there is no projected debt service for future debt as shown in Line 15 in Table W - 9 in Appendix 1. 4.3.6 Transfer to Shop Fund The transfer to the shop fund is made by the utility whenever a new vehicle (associated with new personnel) is purchased, thereby expanding the existing fleet. There are no projected transfers to the shop fund over the study period as shown in Line 17 in Table W - 9 in Appendix 1. 4.3.7 Transfer to Operating Reserve The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve is projected to increase from $133,000 in 2022 to $151,800 in 2026 reflecting the growth in the O&M budget. Line 18 in Table W - 9 in Appendix 1 presents the projected transfers to the operating reserve for the period 2021 through 2026. 4.3.8 Water Cash Financed Capital The City currently utilizes the following two sources of funding for the water utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. As stated in Section 4.2, the water capital improvement program for the study period is $52 million, of which $50 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. A capital project meets the requirements of using impact fees if the existing water capacity is expanded due to growth. The construction contract and the budget amendment to change the source of funding to impact fee must be approved by the City Council. Table W - 8 in Appendix 1 presents the sources of funding for the water capital improvement program. Line 19 in Table W - 9 in Appendix 1 presents the projected transfers for cash financed capital for the period 2021 through 2026. 4.3.9 Transfer to Capital Reserve The water utility, after meeting all the obligations stated in sections above, transfers the excess funds to the capital reserve fund. The capital reserve fund is used as a source for funding the capital program in the years that the revenues are not sufficient to meet the capital funding requirements. Line 20 in Table W - 9 in Appendix 1 presents the projected transfers to and from the capital reserve for the period 2021 through 2026. 4.4 Water Proposed Revenue Adjustments The annual revenue adjustments that are needed to achieve the defined financial performance objectives are determined by evaluating the funding gap between the projected annual revenue requirements and the projected revenues under existing rates. Table W - 9 in Appendix 1, provides a summary of the revenue and revenue requirements (financial plan) for the study period. Projected Revenue Under Existing Rates: Line 1 indicates that under existing rates (2022 rates) water utility revenues will increase from $21.8 million in 2022 to $23.0 million in 2026. Projected Other Revenues: Line 8 indicates that the other revenues are anticipated to increase from $641,500 in 2022 to $665,900 in 2026. This increase is due to the growth in SDWF, which is a pass - through. It is anticipated that all other categories of other revenues will remain flat throughout the study period. BLACK & VEATCH I Water Utility 4-6 Page 168 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Projected Expenses: Line 15 indicates the total annual expenses for the water utility are anticipated to increase from $17.7 million in 2022 to $20.2 million in 2026. Projected Transfers: Line 20 indicates the total annual transfers for the water utility are anticipated to increase from $4.8 million in 2022 to $6.3 million in 2026. Funding Gap: The cash flow analysis indicates that the sum of revenues under existing rates and the other revenues is not adequate to fund the projected annual revenue requirements, thereby causing an operating deficit. Proposed Revenue Adjustments: To address the funding gap in the water utility, a series of revenue adjustments are proposed as follows: 2022: 3% effective (January 1, 2022) 2023: 3% effective (January 1, 2023) 2024: 3% effective (January 1, 2024) 2025: 3% effective (January 1, 2025) 2026: 3% effective (January 1, 2026) Lines 2 through 7 present the amount of additional revenues generated each year with the proposed magnitude and timing of revenue adjustments. Figure 4-5 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Water Utility Revenues and Revenue Requirements S30,000,000 S25,000,000 S20,000,000 S15,000,000 S10,000,000 $5, 000,000 $0 2021 2022 2023 2024 2025 2026 M O&M Expenses Cash Financing of Capital i Ot he r Tra nsfe rs Revenues Under Existing Rates Revenues Under Proposed Rates Figure 4-5 - Water Revenues and Revenue Requirements Table W - 10 in Appendix 1 presents the water utility's operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: ■ O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. BLACK & VEATCH I Water Utility 4-7 Page 169 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study ■ Operating Fund Balance: A minimum target of $100,000. ■ Capital Fund Balance: A minimum target of $500,000. ■ Capital Reserve Fund Balance: An amount necessary to fully fund anticipated capital projects. As shown in Table W - 10, the proposed annual revenue adjustments will allow the water utility to meeting the minimum fund balance requirements for all funds through 2026. 4.5 Water Cost of Service A key step to developing an equitable rate structure involves the cost of service analysis. The financial plan discussed in sub sections 4.1 through 4.4 provides an estimate of the total annual revenue requirements for a given fiscal year. The cost of service analysis provides a mechanism to defensibly allocate the total annual revenue requirements to the various customer classes. The cost of service is typically performed for a single year, referred to as the "Test Year" for which the rates are to be designed. The test year for which the cost of service study was performed is 2022. The key components of the cost of service analysis are: Determination of Cost of Service (net revenue requirements); Determination of Functional Costs; Allocation of Functional Costs to Cost Components; and Distribution of Water Utility Costs to Customer Classes 4.5.1 Determination of Cost of Service The first step is to determine the cost of service that is to be recovered from user rates and charges. As briefly discussed in Section 2.3, cost of service is defined as, and synonymous with, the "net revenue requirement" that is to be recovered for the test year through user rates and charges. Table W -11 in Appendix 1 presents the derivation of the cost of service to be recovered through water charges. As Line 18 in Table W - 11 indicates, the water cost of service for 2022 is projected to be $21.8 million. This cost of service consists of $17.2 million of net O&M expense and $4.6 million of net capital costs. Costs of service is apportioned among customer classes in this study on a "Utility Basis", that is, in terms of operating expense, depreciation expense, and return. For a municipal utility, the total of depreciation expense and return is equal to the capital cost related portion of the total cost of service. Depreciation is the loss in value of the original plant investment, not restored by current maintenance, due to wear, decay, inadequacy, and obsolescence. Annual depreciation is determined as a percentage of original investment based on expected service lives of the various facilities. Unless funds are provided for normal annual replacement of original plant items, operating reliability of the system, as well as the value, will decrease. Depreciation funds are used to finance principal payments on bond issues and provide normal annual capital expenditures. The depreciation expense associated with the water utility is estimated in this study recognizing depreciation rates presently in use by the water utility. This results in a projected test year depreciation BLACK & VEATCH I Water Utility 4-8 Page 170 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study expense of $2.7 million exclusive of depreciation on contributed plant, which is not recognized for cost allocation or rate design purposes. The contributed plant adjustment is consistent with generally accepted regulatory practices. Total return on the system investment provides funds for bond interest payments and any other costs that may be incurred. In developing the level of return on net plant serving the requirements of outside City customers, provisions for a reasonable margin should be made to meet interest on borrowed funds, and to recognize the business risk assumed by the City in providing reliable facilities to serve nonresident customers. Total return for the test year is projected to be $1,895,900 as shown on Line 17 of Table W - 11 in Appendix 1. 4.5.2 Determination of Functional Costs As a basis for developing an equitable rate structure, the test year cost of service should be allocated to the various customer classes according to respective service requirements. The basic underlying principle in developing cost of service rates is the determination of what elements in a water system are responsible for causing the level of revenue requirements that is needed. To allocate the costs to customer classes, first the operating and capital costs of service are aggregated into "Functional Cost Centers." The functional costs are then further allocated to cost components. Each component cost is then apportioned to customer classes Functional Cost Centers Functional cost centers of a water utility represent the activities that contribute to the incurrence of O&M and capital costs. For a water utility, they often include source of watersupply, pumping, treatment, storage, distribution, meters, billing, and other administration costs. Both the O&M and capital costs defined for the Test Year, discussed in 4.5.1, need to be allocated to functional cost centers. Functional Costs The capital costs associated with the functional cost centers are determined using detailed fixed assets data, provided by the City, for each class of asset that is currently in service, construction work in progress and projected capital improvement program for the test year. The total value of the fixed assets (referred to as "Net Plant Investment") in the system is usually presented as Original Cost Less Depreciation ("OCLD"). The total estimated OCLD of the water system is $96.2 million, as presented in Line 9 in Table W - 12 in Appendix 1. This plant investment data is subsequently used as a basis for the allocation to cost components, discussed in the following subsection 4.5.3.2. The O&M costs for the Test Year are allocated to the various functional cost centers based on the specific nature of costs. The allocation of the projected 0&M cost of service (net operating revenue requirement) of $17.2 million, to the various functional cost centers, is presented in Table W - 14 in Appendix 1. The various cost elements of water service are assigned to functional cost components as the first step in the subsequent distribution of the costs of service to customer classes. BLACK & VEATCH I Water Utility 4-9 Page 171 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5.3 Allocation of Costs to the Functional Cost Components The principal functional cost components consist of Base Costs, Extra -Capacity Costs, and Customer Costs. Base costs are those which vary directly with the quantity of water used, as well as those costs associated with serving customers under average load conditions without the elements necessary to meet water use variations or peak demands. Base costs include purchased power and treatment chemicals, and other operating and capital costs of the water system associated with serving customers to the extent required for a constant, or average annual rate of use. Extra -Capacity costs represent those operating costs incurred due to demands in excess of average, and capital related costs for additional plant and system capacity beyond that required for the average rate of use. Total extra capacity costs are subdivided into costs associated with maximum day and maximum hour demand. Customer Costs are defined as costs which tend to vary in proportion to the number of customers connected to the system. These include meter reading, billing, collection and accounting costs, and maintenance and capital charges associated with meters and services. The delineation of costs of service into these principal categories provides the means of further allocating such costs to the various customer classes based on the respective base, extra capacity, and customer service requirements of each customer class. Wholesale customers generally do not use smaller water distribution mains as do retail users. Therefore, separate functional cost of service categories are designated for costs which are common to all customer classes and those which are common to retail service classes only. 4.5.3.1 Water Utility Allocation to Cost Components The water utility is comprised of a variety of service facilities, each designed and operated to fulfill a given function. In order to provide adequate service to its customers at all times, the utility must be capable of not only providing the total amount of water used, but also supplying water at maximum rates of demand. Since all customers do not exert their maximum demand for water at the same time, capacities of water facilities are designed to meet the peak coincidental demands that all classes of customers, as a whole, place on the system. For every water service facility on the system, there is an underlying average demand, or uniform rate of usage exerted by the customers for which the base cost component applies. For those facilities designed solely to meet average day demand, costs are allocated 100% to the base cost component. Extra capacity requirements associated with coincidental demands in excess of average use are further related to maximum daily and maximum hourly demands. Analysis of historical system maximum day and maximum hour demands to average day demands results in appropriate ratios for the allocation of capital costs and operating expenses to base and extra capacity cost components. A maximum day to average day ratio of 2.10 is used based on experienced demands in the water system. This indicates that approximately 47.6% of the capacity of facilities designed and operated to meet maximum day demand is required for average or base use. According, the remaining 52.4% is required for maximum day extra capacity requirements. BLACK & VEATCH I Water Utility 4-10 Page 172 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The costs associated with facilities required to meet maximum hour demand are allocable to base, maximum day extra capacity, and maximum hour extra capacity. A ratio of maximum hour to annual average day water use of 2.73 is used, based on demands experienced by the system. This ratio indicates that 36.6% of the capacity of facilities designed and operated for maximum hour demand is needed for average or base use, while 40.3% is utilized for maximum day extra capacity uses, and the remaining 23.1% is required to meet maximum hour extra capacity demand in excess of maximum day needs. 4.5.3.2 Allocation of Net Water Plant Investment The estimated test year net plant investment in water facilities consists of net plant in service as of December 31, 2019, the 2020 construction work in progress, and the estimated cost of proposed capital improvements expected to be in service by the end of calendar year 2022. As the wholesale customers have their own storage tanks, the plant investment associated with tanks was allocated to the retail customers only. The total estimated OCLD of the water system is $96.2 million, as presented in Line 9 in Table W - 12 in Appendix 1. Plant investment is allocated to cost components on a design basis recognizing the principal function governing the design of the facility. The allocation of net plant investment provides the basis for allocation of depreciation expense. 4.5.3.3 Allocation of Water Facilities Depreciation Expense Depreciation is a real part of the cost of operating a utility. In utility accounting, it is generally accepted practice to use depreciation funds to finance system replacements, improvements, and extensions. While such action does not restore the value lost in each property unit every year, the total value lost through depreciation is restored to the system as a whole. Depreciation funds can be reinvested in the system either by direct payment of routine capital additions and replacements or by principal payments on bonded debt. The total estimated depreciation cost (excluding depreciation on contributed facilities) for the water system is $2.7 million, as presented on Line 9 in Table W - 13 in Appendix 1. As the wholesale customer have their own storage tanks, the depreciation costs associated with tanks was allocated to the retail customers only. 4.5.3.4 Allocation of Water Utility Operating Expenses Table W - 14 in Appendix 1 presents the allocation of O&M expense to functional cost components. Total test year O&M expense, as shown on Line 7 of this table, amounts to $17.2 million. Operating expenses are allocated to functional cost components in generally the same manner as plant investment. 4.5.4 Distribution of Water Utility Costs to Customer Classes As a basis for determining the cost of water service to each customer class, the elements of cost of service previously allocated to functional cost components are distributed among the classes in proportion to their respective service requirements. Estimates of these requirements, or units of service, reflect the average number of accounts with recognition to relative meter sizes serving each account, annual water sales, and estimated peak water demands placed on the system by each customer class. Analysis of resulting costs of service to each class and comparison of allocated costs with revenues under existing rates provide a basis for future water rate adjustments. BLACK & VEATCH I Water Utility 4-11 Page 173 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5.4.1 Water Customer Classification Customer classes consist of residential, non-residential, industrial, irrigation, wholesale, and public and private fire protection. The residential class includes single family residential, duplex, fourplex, apartment, multi -unit residential, and rooming house customers. The non-residential class includes commercial, combination, construction, government, and non-profit classes. Industrial includes major and minor industrial. Outside City includes Farmington, Greenland, Washington/Growth Area, Johnson, and Goshen/ White River. Wholesale includes the communities of Elkins, West Fork, Mt. Olive, and RDA/WWA. These classes group together customers with similar service requirement characteristics and provide a means for allocating costs to customers. 4.5.4.2 Water Units of Service The cost of service responsibility for base costs varies with the annual volume of water usage and is distributed to customer classes on that basis. Extra capacity costs are those costs associated with meeting peak rates of water use and are distributed to customer classes on the basis of their respective system capacity requirements in excess of average requirement rates. Customer costs, which consist of meter related costs, billing, collection and accounting costs, are allocated on the basis of the number of equivalent meters and monthly bills. The estimated units of service for the various customer classifications are presented in Table W -15 in Appendix 1. Estimates of test year annual water volumes, shown in Column 1, are based on the projections of total water sales for the test year 2022. Average daily water use is presented in Column 2. Columns 3 through 8 present the estimated maximum day and maximum hour capacity factors for each customer class, the resulting demands, and extra capacity requirements, respectively. Customer related meter and service costs are allocated on the basis of the number of equivalent 3/4 inch meters serving each customer class. The number of equivalent meters in each customer class (Column 10) is estimated by relating typical costs for meters and services larger than 5/8 inch in size to the typical cost of a 3/4 inch meter and its related service line. Customer billing and accounting costs are distributed to classes on the basis of the number of bills for each customer class in Column 11. Extra capacity requirements for fire protection service recognize, in part, peak fire flow requirements, and system capabilities established by the Insurance Service Office. One fire is estimated with peak fire flow requirements of 9,000 gallons per minute for 10 hours (maximum day) and 24 hours (maximum hour). Direct fire protection costs have been allocated between inside City and outside City customers in proportion to the number of equivalent 6-inch fire hydrants, as shown in Columns 12 and 13. 4.5.4.3 Water Utility Customer Class Costs of Service Unit costs of service are developed by dividing the total cost allocated to each functional cost component by the total applicable units of service. The customer class responsibility for service is obtained by applying unit costs of service to the number of units for which the customer class is responsible. The water utility has been built with provision for service to customers outside the City, yet the inside City customers must bear the responsibility for providing system facilities by undertaking the necessary investment. Revenues derived from outside City service should provide a margin of return on capital adequate to induce the citizens of Fayetteville to bear the risks of providing outside City service. To recognize the proprietary interest and responsibility of inside City customers in the system, it is proper to charge outside City customers, in addition to their share of operating expense and depreciation, a BLACK & VEATCH I Water Utility 4-12 Page 174 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study reasonable return on their allocated portion of value. A 7.0% (4.0% for future debt service plus 3.0% risk component) annual rate of return on the value of water facilities serving outside City customers is recognized for purposes of this study. Table W - 16 in Appendix 1 shows the development of the unit costs of service applicable to each cost function. Lines 1 through 3 summarize the units of service developed in Table W - 15. Total allocated costs or investment shown on Lines 4, 6, and 8 were previously developed in Table W - 12, Table W - 13 and Table W - 14 respectively. Unit costs of service for each component are determined by dividing the allocated cost or investment by the total units of service. Total allocated unit costs of service for inside and outside City customers (Lines 15 and 16) are determined by adding the unit costs for net operating expense (Line 5) and depreciation expense (Line 7) to the respective inside and outside City unit costs for return on investment (Lines 10 and 11). These unit costs applied to the respective units of service shown on Lines 1 and 2 determine the allocated total costs of service for inside and outside City customers shown on Lines 17 and 18. In order to determine the allocated costs for each customer class, the costs are allocated to the various customer classes by applying the appropriate unit cost of service to the respective service requirements of each customer class. Table W - 17 in Appendix 1 shows the resulting allocated and adjusted cost of service by customer class, revenue under existing rates, and the additional revenue required from each class. Costs associated with public fire protection are not recovered through direct charges, therefore, the cost of service for this class is reallocated to all other retail customers in proportion to their allocated cost of service as shown in Column 3. The test year adjusted cost of service, reflecting the reallocation of these costs, is shown in Column 4. The indicated increase or decrease in revenue required to meet adjusted cost of service is shown in Column 6. BLACK & VEATCH I Water Utility 4-13 Page 175 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 5.0 Water Rate Design The principal consideration in establishing water rate schedules is to establish rates to customers to recover costs that reasonably commensurate with the cost of providing water service. Theoretically, the only method of assessing entirely equitable rates for water service would be the determination of each customer's bill based upon each customer's particular service requirements. Since this is impractical, schedules of rates are normally designed to meet average conditions for groups of customers having similar service requirements. Rates should provide for equitable cost recovery, ease of customer understanding and be simple to administer. The revenue requirements and cost of service allocations described in the preceding sections provide the basis for adjusting water rates. The revenue requirements reflect the need for adjustment and the level of revenue required. The cost of service analysis provides the unit costs of service used in the rate design process and gives a basis for determining whether resultant rates will develop revenues which recover costs of service from customer classes in proportion to service required and provide the total level of revenue required. 5.1 Existing Water Rates The existing schedule of rates for water service became effective on January 1, 2022. For both retail and wholesale customers, these rates include a monthly base charge bill, which varies by meter size. The volume charge varies by customer class. The existing water rate structure is described in Section 3.3.1. The existing schedule of base and volumetric water rates is shown in Table W - 3. 5.2 Proposed Water Rates The cost of service analysis described in the preceding sections of this report provides a basis for the design of a schedule of water rates to meet those costs. Proposed water base charge and volume rates have been designed to meet the test year allocated costs of service and are presented in Table W - 18. The proposed rate structure eliminates the minimum volume charge associated with 1,000 gallons. Additionally, volumetric rate structure for non-residential and irrigation customers classes both inside and outside city were changed from declining block rates to uniform block rates Figure 5 -1 below presents the proposed water rate structure. Figure 5 - 1 Proposed Water Rate Structure • Base Charge by Meter Size Retail Inside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Retail Outside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Wholesale Volume Rate (3-Tier Inclining Block) Retail Inside City Residential; and Retail Outside City Residential Volume Rate (Uniform) Retail Inside City Non -Residential, Major Industrial, Irrigation; and BLACK & VEATCH I Water Rate Design 5-14 Page 176 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Retail Outside City Non -Residential, Irrigation Volume Rate ( Uniform) Wholesale Safe Drinking Water Fee (per month) All customer classes In developing proposed schedules of water rates, it must be recognized that the cost of service studies are the result of engineering estimates, based to some extent upon judgment and experience, and detailed results should not be used as literal and exact answers but as guides for potential rate adjustments. Practical considerations such as previous rate levels, bill impact on customers, and magnitude of cost of service shifts among customer classes, and past local practices are commonly recognized in making rate adjustments. A comparison of estimated test year revenue under the proposed rates with allocated costs of service for each of the customer classes is presented in Table W -19 in Appendix 1. This comparison indicates the proposed rates will recover revenues from inside and outside City customer groups reasonably commensurate with the cost of service and practical considerations previously noted. To better reflect the total effect the proposed rates have on customer bills, a comparison of typical inside city and outside city customer water charges under existing rates and the rates proposed to become effective August 1, 2022, is presented in Table W - 20. BLACK & VEATCH I Water Rate Design 5-15 Page 177 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 6.0 Wastewater Utility The financial plan and rate design were developed to meet all the funding obligations of the wastewater utility, and to achieve the financial adequacy and equitable cost recovery discussed in Section 2.3. The wastewater utility financial plan was developed for the forecast period of 2021 through 2026, and includes the following key components: Revenue projections (user rate revenues and non -rate revenues); Capital improvement program; Annual revenue requirement projections; and Annual proposed revenue increases 6.1 Wastewater Revenue Projections Under Existing Rates The wastewater utility revenues are derived from the following sources: Wastewater Service Revenues (Base and Volume Charge) Other Revenues As a first step in the development of the financial plan, Wastewater Service Revenues under the 2021 existing rates are projected for the forecast period. 6.1.1 Wastewater Revenue Under Existing Rates As described in Section 3.3.2, the Wastewater Service Revenue consists of two charge components. For each of the two components, revenues are projected based on billing units and applicable existing rate schedules. The billing units necessary to compute the Base Charge revenues are the number of accounts based on meter size and customer class. The billing units necessary to compute the Volume Charge are the annual wastewater billed volumes by customer class and by applicable blocks of billable wastewater volume. 6.1.1.1 Projection of Customer Accounts Typically, historical billing units are reviewed and used to project billing units for the forecast period. The project team reviewed historical accounts and billed volume trends for each customer class referenced in Section 3.3.1. Based on the review of historical trends, two annual adjustment factors were applied to project billing units for the forecast period. The two adjustment factors applied at the customer class level are accounts growth rate and volume factor. The number of accounts is projected to grow for residential customer classes Fayetteville (Inside City) and Farmington (Outside City), whereas all other customer classes are anticipated to remain at the 2020 level. The total number of wastewater accounts is anticipated to increase from about 40,100 in 2021 to about 43,300 in 2026, at an overall annual system growth rate of 1.6%. Table S - 1 in Appendix 2 presents the projected annual number of accounts for the period of 2021 through 2026. BLACK & VEATCH I Wastewater Utility 6-1 Page 178 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 6-1 presents both the historical and projected number of accounts for the wastewater utility. Waterwater Utility Historical and Projected Accounts 46,000 44,000 r 42,000 r r r r r r r 40,000 38,000 36,000 34,000 32,000 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-1- Historical and Projected Wastewater Accounts 6.1.1.2 Projection of Wastewater Volume Billed wastewater volumes are projected based on estimates of the number of wastewater accounts and the average billed volume per account. Average billed volume per account is determined based on historical billed volume. The historical billed volume per account for all customer classes varies each year between 2016 and 2020. In 2020, the COVID pandemic led to stay-at-home measures and shut down of non -essential businesses across the country. Consequently, the residential customers used more water in 2020, whereas the non-residential customers used less water as compared to previous years. The average billed volume per account for 2021 was projected to remain at the 2020 levels assuming a lingering effect of the pandemic. The average billed volume per account for 2022 and beyond was projected to return to the 2019 level for all customer classes assuming a return to pre - pandemic levels. Total system wastewater billed volume is projected to increase from 3,043,100 kgals in 2021 to 3,205,800 kgals in 2026. Table S - 2 in Appendix 2 presents the historical and projected annual volume for the period of 2020 through 2026. Figure 6-2 presents both the historical and projected annual billed volume for the wastewater utility. BLACK & VEATCH I Wastewater Utility 6-2 Page 179 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Wastewater Utility Historical and Projected Billed Volume (1,000Gallons) 3,500,000 3,000,000 — — — — — — — 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-2 - Historical and Projected Wastewater Billed Volume 6.1.2 Projection of Service Revenue Under Existing Rates Wastewater service revenues for the period 2021 through 2026 are projected for each charge component (base and volume) based on the projections of accounts by meter size, projected billed volume for each customer class, and the application of the 2021 rate schedule for 2021 revenues and 2022 rate schedule for 2022 through 2026. Wastewater service revenue under existing rates is projected to increase slightly from $24.5 million in 2021 to $26.7 million in 2026. This growth is due to increase in wastewater sales due to the growth in the number of accounts over the study period. Table S - 4 in Appendix 2 presents the historical and projected annual service revenues for the period of 2021 through 2026. Figure 6-3 presents both the historical and projected annual service requirements under existing rates for the wastewater utility. Wastewater Utility Historical and Projected Service Revenues (Under Existing Rates) $30,000,000 525,000,000 — — — — — — — $20,000,000 S 15,000,000 510,000,000 $5,000,000 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-3 - Historical and Projected Wastewater Service Revenue 6.1.3 Other Wastewater Revenue The other revenues include the following major components: BLACK & VEATCH I Wastewater Utility 6-3 Page 180 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Impact Fee Revenue; Wastewater Connection Fees; Wastewater Sales Not on Computer Penalties; and WWTP Fees (Hay Sales, Biosolids/ Fertilizer Sales & Water Treatment Residual) The annual revenues from wastewater impact fees, wastewater connection fees. wastewater sales not on computer, and WWTP Fees for 2021 to 2026 are projected based on historical three-year (2018 to 2020) average revenues for each of the fees. The penalties revenue in 2020 reflects only the first two and half months of revenues, as the City stopped assessing penalties for non-payment due to the pandemic. The revenue for penalties in 2021 is projected to be half of the historical three -year (2017 to 2019) average revenues due to continued waiver of the penalties as a result of the COVID pandemic during the first half for 2021. The revenue from penalties in 2022 and beyond is projected as the historical three-year average (2017 to 2019) average revenues. Table S - 5 in Appendix 2 presents the historical and projected annual other revenues for the period of 2020 through 2026. 6.2 Wastewater Capital Improvements Program The capital project costs provided by the City were based on 2020 dollars. Based on discussions with the City, the project costs are inflated at an annual rate of 3.0% to accurately reflect the costs of projects for 2021 and beyond. The City's wastewater utility Capital Improvement Plan (CIP) provides for a total of $69.3 million of investments during the study period of 2021 through 2026. Major wastewater projects include sanitary wastewater rehabilitation totaling $15.7 million and Biosolids Dryer Replacement totaling $31.1 million. Table S - 6 in Appendix 2 presents the CIP list of projects for 2021 through 2026. The CIP is expected to be financed from a funding mix of cash financing from service revenue and impact fees. 6.3 Wastewater Utility Revenue Requirements Projection of reliable revenue requirements includes: (1) O&M expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) debt service (consisting of principal and interest payments); (5) transfer to shop fund; (6) transfer to operating reserve; (7) cash financed capital; and (8) transfer to capital reserve. The projections of annual revenue requirements for the study period is discussed in this section. 6.3.1 Wastewater Operation and Maintenance Expenses The O&M expenses for the wastewater utility include the annual expenses associated with the wastewater conveyance, pumping, treatment and disposal; meters and services; billing and collection, and general administrative services. These expenses include personnel costs (salaries and benefits), costs for materials and supplies, costs of utilities, and contracted services. The 2021 O&M budget provided by the City was used as the baseline for projection of O&M expenses for the study period. In addition, costs associated with a wastewater inspector (not included in the 2021 budget) recurring salary and benefits costs, recurring vehicle maintenance costs and one-time cost of the vehicle purchase was added per City's direction. Based on historical O&M costs, industry experience, and discussions with the City management, appropriate escalation factors were applied to various BLACK & VEATCH I Wastewater Utility 6-4 Page 181 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study categories of costs to project future annual O&M expenses. Annual escalation factors used for major cost categories include the following: Salaries: 4.00% Benefits: 5.00% Energy: 3.00% Chemicals: 3.00% Wastewater Treatment Plant Contract: 3.00% The annual O&M expenses for wastewater utility are budgeted at $15.7 million in 2021 and are projected to grow to $18.4 million by 2026. Table S - 7 in Appendix 2 presents a summary of projected operation and maintenance expense for the period 2021 through 2026. Figure 6-4 presents the historical and projected O&M expenses for the wastewater utility. S2o,000,o00 S15,000,00a S10,000,00o $5,000,000 Wastewater Utility Historical and Projected O&M Expenses 2020 2021 2022 2023 2024 2025 202b Historical — — Projected Figure 6-4 - Projected Annual Wastewater O&M Expense 6.3.2 Wastewater Bad Debt Bad debt expenses refer to outstanding balances owed that are deemed uncollectible. The wastewater bad debt in 2019 was 0.5% of revenue. Hence, the bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for wastewater utility is projected to increase from $122,300 in 2021 to $149,900 by 2026 reflecting the increase in projected revenues. Line 16 in Table S - 9 in Appendix 2 presents bad debt expense for the period 2021 through 2026. 6.3.3 Wastewater Payment In Lieu of Taxes The PILOT costs are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires that the water and wastewater funds to pay 4.25% of annual total gross sale revenues to the City. Annual PILOT amount for the wastewater utility is calculated by multiplying actual wastewater revenues from prior year (Wastewater sales on Computer and Wastewater sales not BLACK & VEATCH I Wastewater Utility 6-5 Page 182 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study on Computer/ Dump Fees) and is projected to increase from $1,039,600 in 2021 to $1,274,000 in 2026. Line 17 in in Appendix 2 presents PILOT expense for the period 2021 through 2026. 6.3.4 Wastewater Debt Service Requirements The wastewater utility does not have any outstanding debt service obligations. The City does not anticipate any debt issuances during the study period, therefore no projected debt service for future debt as shown in Line 18 in Table S - 9 in Appendix 2. 6.3.5 Transfer to Shop Fund The transfer to the shop fund is made by the utility whenever a new vehicle (associated with new personnel) is purchased, thereby expanding the existing fleet. There are no projected transfers to the shop fund over the study period as shown in Line 20 in Table S - 9 in Appendix 2 6.3.6 Transfer to Operating Reserve The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve is projected to increase from $129,600 in 2022 to $147,900 in 2026 reflecting the growth in the O&M budget. Line 21 in Table S - 9 in Appendix 2 presents transfer to the operating reserve for the period 2021 through 2026. 6.3.7 Wastewater Cash Financed Capital The City currently utilizes the following two sources of funding for the wastewater utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. As stated in Section 6.2, the wastewater capital improvement program for the study period is $69 million, of which $67 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. A capital project meets the requirements of using impact fees if the existing wastewater capacity is expanded due to growth. The construction contract and the budget amendment to change the source of funding to impact fee must be approved by the City Council. Table S - 8 in Appendix 2 presents the sources of funding for the wastewater capital improvement program. Line 22 in Table S - 9 in Appendix 2 presents transfer for cash financing of capital program for the period 2021 through 2026. 6.3.8 Transfer to Capital Reserve The wastewater utility, after meeting all the obligations stated in sections above, transfers the excess funds to the capital reserve fund. The capital reserve fund is used as a source for funding the capital program in the years that the revenues are not sufficient to meet the capital funding requirements. Line 23 in Table S - 9 in Appendix 2 presents transfer to and from the capital reserve for the period 2021 through 2026. 6.4 Wastewater Proposed Revenue Adjustments The annual revenue adjustments that are needed to achieve the defined financial performance objectives are determined by evaluating the funding gap between the projected annual revenue requirements and the projected revenues under existing rates. Table S - 9 in Appendix 2 provides a summary of the revenue and revenue requirements (financial plan) for the study period. Projected Revenue Under Existing Rates: Line 1 indicates that under existing rates (2022 rates) wastewater utility revenues will increase from $25.4 million in 2022 to $26.7 million in 2026. BLACK & VEATCH I Wastewater Utility 6-6 Page 183 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Projected Other Revenues: Line 8 indicates that the other revenues and interest income are anticipated to increase from $720,500 in 2022 to $731,200 in 2026. It is anticipated that all categories of other revenues will remain flat throughout the study period. The slight growth is due to the increase in interest income on the operating reserve. Projected Expenses: Line 14 indicates the total annual expenses for the wastewater utility are anticipated to increase from $17.4 million in 2022 to $19.8 million in 2026. Projected Transfers: Line 19 indicates the total annual transfers for the wastewater utility are anticipated to increase from $8.8 million in 2022 to $10.9 million in 2026. Funding Gap: The cash flow analysis indicates that the sum of revenues under existing rates and the other revenues is not adequate to fund the projected annual revenue requirements, thereby causing an operating deficit. Proposed Revenue Adjustments: To address the funding gap in the wastewater utility, a series of revenue adjustments are proposed as follows: 2022: 3% effective (January 1, 2022) 2023: 3% effective (January 1, 2023) 2024: 3% effective (January 1, 2024) 2025: 3% effective (January 1, 2025) 2026: 3% effective (January 1, 2026) Lines 2 through 7 in Table S - 9 present the amount of additional revenues generated each year with the proposed magnitude and timing of revenue adjustments. Figure 6-5 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Wastewater Utility Revenues and Revenue Requirements 540,000,000 530,000,000 520,000,000 510,000,000 50 2021 2022 2023 2024 2025 2026 O&M Expenses Cash Financing of Capital Other Transfers Revenues Under Existing Rates Revenues Under Proposed Rates Figure 6-5 - Wastewater Revenues and Revenue Requirements BLACK & VEATCH I Wastewater Utility 6-7 Page 184 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 10 in Appendix 2 presents the wastewater utility's operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: ■ O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. ■ Operating Fund Balance: A minimum target of $100,000. ■ Capital Fund Balance: A minimum target of $500,000. ■ Capital Reserve Fund Balance: An amount necessary to fully fund anticipate capital projects. As shown in Table S - 9, the proposed annual revenue adjustments will allow the water utility to meet the minimum fund balance requirements for all funds through 2026. 6.5 Wastewater Cost of Service A key step to developing an equitable rate structure involves the cost of service analysis. The financial plan discussed in sub sections 6.1 through 6.4 provides an estimate of the total annual revenue requirements for a given fiscal year. The test year for which the cost of service study was performed is 2022. The key components of the cost of service analysis are: Determination of Cost of Service (net revenue requirements); Determination of Functional Costs; Allocation of Functional Costs to Cost Components; and Distribution of Wastewater Utility Costs to Customer Classes 6.5.1 Determination of Cost of Service The first step is to determine the cost of service that is to be recovered from user rates and charges. As briefly discussed in Section 2.3, cost of service is defined as, and synonymous with, the "net revenue requirement" that is to be recovered for the test year through user rates and charges. Table S -11 in Appendix 2 presents the derivation of the cost of service to be recovered through the wastewater charges. As Line 18 in Table S - 11 indicated, wastewater cost of service for 2022 is projected to be $25.4 million. This cost of service consists of $16.8 million of net operation and maintenance expense and $8.6 million of net capital costs. As performed for the water utility, costs of services are apportioned among customer classes in this study on a Utility Basis. The depreciation expense and return on system investments that were already explained in Section 4.5.1 are applicable to the wastewater utility cost of service analysis as well. The depreciation expense associated with the wastewater utility is estimated in this study recognizing depreciation rates presently in use by the wastewater utility. This results in a projected test year depreciation expense of $8.1 million BLACK & VEATCH I Wastewater Utility 6-8 Page 185 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study exclusive of depreciation on contributed plant, which is not recognized for cost allocation or rate design purposes. The contributed plant adjustment is consistent with generally accepted regulatory practices. Total return for the test year is projected to be $567,200 as shown on Line 17 of Table S - 11. 6.5.2 Determination of Functional Costs As a basis for developing an equitable rate structure, the test year cost of service should be allocated to the various customer classes according to respective service requirements. The basic underlying principle in developing cost of service rates is the determination of what elements in a wastewater system are responsible for causing the level of revenue requirements that is needed. To allocate the costs to customer classes, first the operating and capital costs of service are aggregated into "Functional Cost Centers." The functional costs are then further allocated to cost components. Each component cost is then apportioned to customer classes. Functional Cost Centers Functional cost centers of a wastewater utility represent the activities that contribute to the incurrence of O&M and capital costs. For a wastewater utility, they often include source of collection, pumping, conveyance, treatment, disposal, meters, billing, and other administration costs. Both the O&M and capital costs defined for the Test Year, discussed in 6.5.1, need to be allocated to functional cost centers. Functional Costs The capital costs associated with the functional cost centers are determined using detailed fixed assets data, provided by the City, for each class of asset that is currently in service, construction work in progress and projected capital improvement program for the test year. The total value of the fixed assets (referred to as "Net Plant Investment") in the system is usually presented as Original Cost Less Depreciation ("OCLD"). The total estimated OCLD value of the wastewater system is $190.7 million, as presented in Line 26 in Table S - 12 in Appendix 2. This plant investment is subsequently used as a basis for the allocation to cost components, discussed in the following subsection 6.5.3.2. The O&M costs for the Test Year are allocated to the various functional cost centers based on specific nature of costs. The allocation of the projected O&M cost of service (net operating revenue requirement) of $16.8 million, to the various functional cost centers is presented in Table S - 14 in Appendix 2. The various cost elements of wastewater service are assigned to functional cost components as the first step in the subsequent distribution of the costs of service to customer classes. 6.5.3 Allocation of Costs to the Functional Cost Components The principal functional cost components consist of volume related costs, strength related costs, and customer related costs. Volume costs are those which vary directly with the quantity of wastewater contributed. They consist of capital costs related to investment in system facilities which are sized on the basis of, or required BLACK & VEATCH I Wastewater Utility 6-9 Page 186 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study because of, wastewater volume. This also includes operation and maintenance expense related to those facilities, and the expense of volume related treatment chemicals and purchased power. Wastewater strength costs consist of the operation and maintenance expense and capital costs related to system facilities which are designed principally to treat the wastewater pollutant loadings of pollutants such as BOD, TSS, and other pollutants. BOD costs reflect costs associated with the treatment of influent BOD and include costs related to activated sludge aeration and disposal of BOD related sludge. Suspended solids strength costs are those costs of wastewater treatment which tend to vary according to the quantity of suspended solids in the raw wastewater. Customer costs are those which tend to vary in proportion to the number of customer bills or customers served. These include the wastewater utility share of customer related meter reading, billing, collection, and account expense. The delineation of costs of service into functional components provides a means of distributing such costs to the various customer classes based on the respective total wastewater volume, strength, and customer cost requirements of each. Wholesale customers generally do not use lateral wastewater lines as do retail users. Therefore, separate functional cost of service categories are designated for costs which are common to all customer classes and those which are common to retail service classes only. 6.5.3.1 Wastewater Utility Cost Allocation to Cost Components In establishing the costs associated with each functional cost component, the return portion of the test year cost of service is distributed to cost functions based on an allocation of the estimated test year value of wastewater system facilities. The test year depreciation expense associated with each major element of plant facilities is allocated to cost functions in the same manner as the plant value. Operating expense is similarly allocated to cost functions based on the projected test year expense estimated for each wastewater system component. 6.5.3.2 Allocation of Net Wastewater Plant Investment The estimated test year value of wastewater facilities consists of net plan in service as of December 31, 2019, the 2020 construction work in progress, and the estimated cost of proposed capital improvements expected to be in service by the end of calendar year 2022. Table S - 12 in Appendix 2 presents the allocation of the wastewater utility's total estimated plant value less contributions on an original cost less depreciation value basis. Total plant investment is estimated to be $190.7 million as indicated by Line 26 of the Table S - 12. Plant investment is allocated to cost components on a design basis recognizing the principal purpose governing the design of the facility. The allocation of net plant investment provides the basis for allocation of depreciation expense. The Owl Creek Lift Station and Force Main serve only the City of Fayetteville, hence the plant investment associated with Owl Creek is allocated directly to the City of Fayetteville customers. Additionally, the outside City customers maintain their own wastewater connections, hence, the plant investment associated with wastewater connections is allocated 100% to the City of Fayetteville customers. BLACK & VEATCH I Wastewater Utility 6-10 Page 187 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The City has a contract with the City of Farmington stipulating that Farmington will be allocated 8.2% of the costs associated with the West Treatment Plant. Hence, 8.2% of the West Treatment Plant's investment is allocated directly to the City of Farmington customers. Wastewater collection net plant is allocated 41% to both retail and wholesale (common to all) and 59% to retail only based on the ratio of interceptors (large diameter mains) which is 41% of the collection system. 6.5.3.3 Allocation of Wastewater Facilities Depreciation Expense As explained in Section 4.5.3.3, depreciation expense is a real part of the cost of operating a utility. The total estimated depreciation cost (excluding depreciation on contributed facilities) for the wastewater system is $8,060,600 as presented on Line 26 in Table S - 13 in Appendix 2. The items of expense are allocated to cost components on the same design or cost causative basis used to allocate plant investment. Hence, the depreciation expense associated with Owl Creek Lift Station and Force main and Wastewater connections is directly allocated to the City of Fayetteville customers and 8.2% of the West Treatment Plant's depreciation is allocated directly to the City of Farmington customers. 6.5.3.4 Allocation of Wastewater Utility Operating Expenses Table S -14 in Appendix 2 presents the allocation of operation and maintenance expense to functional cost components. Total test year operation and maintenance expense, as shown on Line 14 of this table, amounts to $16.8 million. Operating expenses are allocated to functional cost components in generally the same manner as plant investment. 6.5.4 Distribution of Wastewater Utility Costs to Customer Classes The total cost responsibility of each customer class is determined by developing unit costs of service for each cost component and applying the unit costs to the respective service requirements of each class. In accomplishing this, each customer class is allocated the share of volume, strength, and customer costs for which it is responsible. 6.5.4.1 Wastewater Customer Classification Customer classes consist of residential, non-residential, industrial and wholesale. The residential class includes single family residential, duplex, fourplex, apartment, multi -unit residential and rooming house customers. The non-residential class includes commercial, combination, construction, government, and non-profit customers. Outside City includes Farmington, Greenland, Washington County/Growth Area and Johnson. Wholesale includes the community of Elkins and West Fork. 6.5.4.2 Wastewater Units of Service Derivation of the responsibility of customer classes for costs of service require that each class be allocated a portion of the volume, strength, and customer costs of service according to their respective service requirements. The cost of service responsibility for volume costs, which vary with the volume of wastewater contributed to the wastewater system, is distributed to customer classes on that basis. Strength costs are principally related to the function of reducing wastewater suspended solids, and BOD strength loading. Customer costs, which consist of meter related costs, billing, collection and accounting costs, are allocated on the basis of equivalent meters and monthly bills. BLACK & VEATCH I Wastewater Utility 6-11 Page 188 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The estimated test year service requirements or units of service for the various customer classes are shown in Table S - 15 in Appendix 2. Wastewater collected and treated consists of two elements: (1) sanitary wastewater flow and (2) infiltration/inflow (1/1) of ground water into the sewers. Contributed wastewater flow is that portion of the annual water use and/or other flows from each customer class that are discharged to the wastewater system. Estimates of the contributed volume of each class is generally based upon wastewater billing records. For residential customers, the billed wastewater volume is based on average water consumption for the preceding months of December, January and February. This methodology of using a winter quarter average for quantity of wastewater flows is used to exclude outdoor uses such as irrigation, which do not return water to the collection system. For all other customer classes, the billed wastewater volume is the same as the water volume. The difference between the measured plant influent and the customer contributed wastewater flow is attributed to Infiltration and Inflow (1/1) volume. Based on discussions with the City staff, 40% of the total treated volume is assumed to be 1/1 flows. Each customer class should bear its proportionate share of the costs associated with 1/1, as it is integral aspect of wastewater system costs. The number of customer connections to a wastewater collection system and the volume of customer flows conveyed both influence the extent of 1/1 in a system. Recognizing that the major cost responsibility for 1/1 is allocable on an individual connection basis, two-thirds of the total 1/1 volume projected is allocated to customer classes based on the number of customers with the remaining one-third allocated on the basis of contributed volume. Estimated total strength units shown for each customer class are based on an average BOD concentration of 365 milligrams per liter (mg/1) and an average suspended solids concentration of 285 mg/l. 1/1 strength allowances for BOD and suspended solids are assumed at 25 mg/I and 50 mg/l, respectively. Estimated BOD and suspended solids responsibilities of each customer class presented in Table S -15 in Appendix 2 are based on the respective indicated average strength concentrations and contributed wastewater and 1/1 volumes for each class. Customer billing and accounting costs are distributed to classes on the basis of the number of bills for each customer class (Column 7) in Table S -15. Customer related meter and service costs are allocated on the basis of the number of equivalent 3/4 inch meters serving each customer class. The number of equivalent meters in each customer class (Column 8) is estimated by relating typical costs for meters and services larger than 3/4 inch in size to the typical cost of a 3/4 inch meter. 6.5.5 Wastewater Utility Customer Class Costs of Service Unit costs of service are developed by dividing the total cost allocated to each functional cost component by the total applicable units of service. The customer class responsibility for service is obtained by applying unit costs of service to the number of units for which the customer class is responsible. The wastewater utility has been built with the provision for service to customers outside the City, yet the inside City customers must bear the responsibility of providing system facilities by undertaking the necessary investment. Revenues derived from outside City service should provide a margin of return on capital adequate to induce the citizens of Fayetteville to bear the risks of providing outside City service. To recognize the proprietary interest and responsibility of inside City customers in the system, it is proper to charge outside City customers, in addition to their share of operating expense and depreciation, a reasonable return on their allocated portion of value. A 7.0% (4.0 % for future debt BLACK & VEATCH I Wastewater Utility 6-12 Page 189 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study service plus 3.0% risk component) annual rate of return on the value of wastewater facilities serving outside City customers is recognized for purposes of this study. Table S -16 in Appendix 2 shows the development of the unit costs of service applicable to each cost function. Lines 1 through 3 summarize the units of service developed in Table S - 15. Total allocated costs or investment shown on Lines 5, 7, and 9 were previously developed in Table S - 14, Table S - 13 and Table S - 12, respectively. Total allocated unit costs of service for inside City and outside City customers (Line 18, Line 19, Line 20 and Line 21) are determined by adding the unit costs for net operating expense (Line 6) and depreciation expense (Line 8) to the respective inside and outside City unit costs for return on investment (Lines 11 and 12). These unit costs applied to the respective units of service shown on Lines 1,2 and 3 determine the allocated total costs of service for inside and outside City customers shown on Lines 18 through 21. In order to determine the allocated costs for each customer class, the costs are allocated to the various customer classes by applying the appropriate unit cost of service to the respective service requirements of each customer class. Table S -17 in Appendix 2 shows the resulting allocated cost of service by customer class, revenue under existing rates, and the indicated increase or decrease in revenue required to meet the allocated cost of service. BLACK & VEATCH I Wastewater Utility 6-13 Page 190 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 7.0 Wastewater Rate Design The principal consideration in establishing wastewater rate schedules is to establish charges to recover costs that are reasonably commensurate with the cost of providing wastewater service. The revenue requirements and cost of service allocations described in the preceding sections provide the basis for adjusting wastewater rates. The revenue requirements show the need for adjustment and the level of revenue required. This cost of service analysis provides the unit costs of service to be used in the rate design process and gives a basis for determining whether resultant rates will generate revenues which recover costs of service from customer classes in proportion to service required and provide the total level of revenue required. 7.1 Existing Wastewater Rates The existing schedule of rates for wastewater service became effective on January 1, 2022. For retail customers, these rates include a monthly base charge bill, which varies by meter size. The volume charge varies by customer class. Surcharge rates are based on excess strength of BOD and TSS. The existing wastewater rate structure is described in Section 3.3.2. The existing schedule of base and volume rates for wastewater service is shown in Table S - 3 in Appendix 2. 7.2 Proposed Wastewater Rates The cost of service study described in preceding sections of this report provides a basis for the design of a schedule of wastewater rates to meet those costs. Proposed wastewater rates have been designed to meet the test year allocated costs of service and are presented in Table S -18. The proposed rate structure presented in Figure 7 - 1 is similar to the existing structure. Figure 7 - 1 Proposed Wastewater Rate Structure • Base Charge by Meter Size • Retail Inside City (Residential, Non -Residential and Major Industrial); Retail Outside City (Residential, Non -Residential and Major Industrial); Volume Rate (2-Tier Inclining Block) Retail Inside City Residential Based on winter water usage of December, January and February • Volume Rate (Uniform) Retail Inside City (Non -Residential and Major Industrial) Retail Outside City (Residential, Non -Residential and Major Industrial) Volume Rate ( Uniform) Wholesale As already explained in Section 5.2, practical rate design should consider multiple factors including previous rate levels, customer bill impact, and magnitude of cost shifts among customer classes. BLACK & VEATCH I Wastewater Rate Design 7-14 Page 191 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study A comparison of estimated test year revenue under the proposed rates with allocated costs of service for each of the customer classes is shown in Table S -19 in Appendix 2. This comparison indicates the proposed rates will recover revenues from inside and outside City customer groups reasonably commensurate with the cost of service and practical considerations previously noted. To better reflect the total effect the proposed rates have on customer bills, a comparison of typical bills under existing rates and the rates proposed to become effective 1, 2022, is shown in Table S - 20. 8.0 Combined Water and Wastewater Utilities Table C - 1 in Appendix 3 presents the combined operating reserve, capital reserve and impact fee fund balances. Table C - 2 in Appendix 3 provides a summary of the combined revenue and revenue requirements (financial plan) for the study period. The revenue under existing rates are not sufficient to meet the obligations of the two utilities. As discussed in Section 4 and Section 6, a series of annual 3% proposed revenue adjustments enable the utilities to meet their operating, capital and reserve obligations. Figure 8-1 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Waterand Wastewater Revenues and Revenue Requirements 570,000,000 550,000,000 550,000,000 � S40,000,000 S30,000,000 S20,000,000 S10,000,000 $0 2021 2022 2023 2024 2025 202S O&M Expenses Cash Financing of Capital Other Transfe rs Revenues Under Existing Rates Revenues Under Proposed Rates Figure 8-1 - Water and Wastewater Revenues and Revenue Requirements Table C - 2 in Appendix 3 presents the combined water and wastewater operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. Operating Fund Balance: A minimum target of $200,000. Capital Fund Balance: A minimum target of $1,000,000. Capital Reserve Fund Balance: An amount necessary to fully fund anticipated capital projects. BLACK & VEATCH I Combined Water and Wastewater Utilities 8-15 Page 192 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study As shown in Table C - 2, the proposed annual revenue adjustments will allow the utilities on a combined basis to meet the minimum fund balance requirements for all funds through 2026. A comparison of combined water and wastewater typical bills under existing rates and the rates proposed to become effective 1, 2022, is shown in Table C - 3. 9.0 Disclaimer This report was prepared for the City of Fayetteville (Client) by Black & Veatch Management Consulting, LLC (Black & Veatch) and is based on information provided by the Client not within the control of Black & Veatch. While it is believed that the information, data and opinions contained herein will be reliable under the conditions and subject to the limitations set forth in this report, Black & Veatch does not guarantee the accuracy thereof. Black & Veatch has assumed that the information provided by others, both verbal and written, is complete and correct. The projections set forth in this report are intended as "forward -looking statements." In formulating these projections, Black & Veatch has made certain assumptions with respect to conditions, events, and circumstances that may occur in the future. While Black & Veatch believes the assumptions are reasonable actual results may differ materially from those projected, as influenced by the conditions, events, and circumstances that occur. As such, Black & Veatch does not take responsibility for the accuracy of data or projections provided by or prepared on behalf of the Client, nor does Black & Veatch have any responsibility for updating this report for events occurring after the date of this report. Use of this report or any information contained therein by any party other than the Client, shall constitute a waiver and release by such third party of Black & Veatch from and against all claims and liability, including but not limited to liability for special, incidental, indirect or consequential damages in connection with such use. Such use of this report by a third party shall constitute agreement by the third party user that its rights, if any, arising from this report shall be subject to the terms of this Report Limitations, and in no event shall the third party's rights, if any, exceed those of the Client under its contract with B&V. The benefit of such releases, waivers, or limitations of liability shall extend to the related companies and subcontractors of any tier of B&V, and the shareholders, directors, officers, partners, employees, and agents of all released or indemnified parties. BLACK & VEATCH I Disclaimer 9-16 Page 193 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 10.0 Appendix 1: Water Tables Table W - 1 - Water Projected Number of Accounts Line 1 2 Inside City Residential Non -Residential 35,200 3,500 35,800 3,500 Projected 36,400 3,500 37,100 3,500 37,700 3,500 38,400 3,500 73,200 0 3 Industrial 21 21 21 21 21 21 0 4 Irrigation 2,000 2,100 2,100 2,100 2,200 2,200 200 5 Private Fire 713 713 713 713 713 713 0 6 7 Subtotal Outside City Residential 41,434 6,500 42,134 6,600 42,734 6,800 43,434 6,900 44,134 7,100 44,834 7,200 3,400 700 8 Non -Residential 400 400 400 500 500 500 100 9 Industrial 0 0 0 0 0 0 0 10 Irrigation 271 277 285 292 299 307 37 11 Private Fire 14 14 14 14 14 14 0 12 13 Subtotal Wholesale Elkins 7,185 1 7,291 1 7,499 1 7,706 1 7,913 1 8,021 1 837 0 14 Mount Olive 2 2 2 2 2 2 0 15 West Fork 1 1 1 1 1 1 0 16 RDA/WWA 4 4 4 4 4 4 0 17 18 19 Subtotal Total %Change 8 48,627 3.26% 8 49,433 1.66% 8 50,241 1.63% 8 51,148 1.81% 8 52,055 1.77% 8 52,863 1.55% 0 4,237 8.71% BLACK & VEATCH I Appendix 1: Water Tables Page 194 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 2 - Water Projected Billed Volume (1,000 Gallons) Line Projected 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Inside City 1 Residential 1,896,300 1,769,800 1,800,800 1,832,300 1,864,400 1,897,000 700 2 Non -Residential 678,600 827,100 827,100 827,100 827,100 827,100 148,500 3 Industrial 322,300 401,800 401,800 401,800 401,800 401,800 79,500 4 Irrigation 249,600 244,300 248,600 252,900 257,300 261,800 12,200 5 Subtotal 3,146,800 3,243,000 3,278,300 3,314,100 3,350,600 3,387,700 240,900 Outside City 6 Residential 427,900 385,700 394,600 403,800 413,300 423,100 -4,800 7 Non -Residential 51,300 65,600 66,400 67,300 68,300 69,200 17,900 8 Irrigation 28,400 24,400 25,000 25,700 26,400 27,100 -1,300 9 Subtotal 507,600 475,700 486,000 496,800 508,000 519,400 11,800 Wholesale 10 Elkins 81,000 75,000 75,000 75,000 75,000 75,000 -6,000 11 Mount Olive 68,900 62,100 62,100 62,100 62,100 62,100 -6,800 12 West Fork 69,200 65,200 65,200 65,200 65,200 65,200 -4,000 0 13 RDA/WWA 0 0 0 0 0 0 14 Subtotal 219,100 202,300 202,300 202,300 202,300 202,300 -16,800 15 Total 3,873,500 3,921,000 3,966,600 4,013,200 4,060,900 4,109,400 235,900 16 %Change 1.26% 1.23% 1.16% 1.17% 1.19% 1.19% 6.09% BLACK & VEATCH I Appendix 1: Water Tables Page 195 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study able W - 3 - Water Existing Rates Existing Water Rates Effective January 1, 2022 Inches 5/8 $/month 6.59 $/month 7.54 $/month 8.31 $/month $/month 3/4 6.59 7.54 8.31 1 9.14 10.52 11.49 9.75 11.68 1 1/2 15.93 18.31 20.00 10.17 12.10 2 23.20 26.66 29.07 20.33 23.37 3 54.05 62.18 64.38 30.48 35.06 4 89.50 102.93 112.25 60.97 70.11 6 178.99 205.82 212.76 169.34 197.74 8 268.41 308.67 332.91 355.65 409.00 10 609.68 701.11 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential 0 - 2,000 Gallons 3.51 4.04 2,000 - 15,000 Gallons 4.65 5.35 Over 15,000 Gallons 6.59 7.54 Non -Residential First 300,000 Gallons 3.79 4.38 Over 300,000 Gallons 3.39 3.90 Major Industrial All Usage 2.96 3.40 Irrigation First 300,000 Gallons 5.04 5.80 Over 300,000 Gallons 4.53 5.22 Wholesale Reduced Peak Demand 2.87 Peak Demand 3.20 BLACK & VEATCH I Appendix 1: Water Tables Page 196 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 4 - Water Projected Revenues Under Existing Rates Inside City 1 Residential 11,196,100 11,001,700 11,194,200 11,390,100 11,589,500 11,792,300 2 Non -Residential 2,844,700 3,476,000 3,476,000 3,476,000 3,476,000 3,476,000 3 Industrial 933,000 1,196,700 1,196,700 1,196,700 1,196,700 1,196,700 4 Irrigation 1,410,700 1,431,200 1,456,300 1,481,800 1,507,700 1,534,100 5 Private Fire 967,600 967,600 967,600 967,600 967,600 967,600 6 Subtotal 17,352,100 18,073,200 18,290,800 18,512,200 18,737,500 18,966,700 Outside City 7 Residential 2,743,800 2,614,600 2,674,900 2,737,200 2,801,400 2,867,700 8 Non -Residential 258,700 328,200 333,000 338,000 343,300 348,800 9 Industrial 0 0 0 0 0 0 10 Irrigation 190,000 173,400 177,900 182,500 187,400 192,400 11 Private Fire 27,100 27,100 27,100 27,100 27,100 27,100 12 Subtotal 3,219,600 3,143,300 3,212,900 3,284,800 3,359,200 3,436,000 Wholesale 13 Elkins 226,800 216,200 216,200 216,200 216,200 216,200 14 Mount Olive 193,900 179,800 179,800 179,800 179,800 179,800 15 West Fork 194,000 188,100 188,100 188,100 188,100 188,100 16 RDA/WWA 0 0 0 0 0 0 17 Subtotal 614,700 584,100 584,100 584,100 584,100 584,100 18 Total 21,186,400 21,800,600 22,087,800 22,381,100 22,680,800 22,986,800 19 % Change 4.28% 2.90% 1.32% 1.33% 1.34% 1.35% (a) Reflects 3.0% revenue increase effective January 1, 2022. Table W - 5 - Water Projected Other Revenues Line 1 Description Water Impact Fee Revenue 2021 S 976,300 2022 S 976,300 Projected 2023 S 976,300 2024 S 976,300 2025 S 976,300 I 2026 S 976,300 0 2 Water Sales Not on Computer 300 300 300 300 300 300 0 3 Water Connection Fees 162,000 162,000 162,000 162,000 162,000 162,000 0 4 Rural Water Connection Fees 2,700 2,700 2,700 2,700 2,700 2,700 0 5 Service Charge/Trip Fee - Billed Service 9,500 9,500 9,500 9,500 9,500 9,500 0 6 Tampering Fee - Billed Service 200 200 200 200 200 200 0 7 Penalties 103,700 207,400 207,400 207,400 207,400 207,400 103,700 20,200 8 Safe Drinking Water Fee 230,000 233,800 237,800 241,800 245,900 250,200 9 10 Total % Change 1,484,700 -0.99% 1,592,200 7.24% 1,596,200 0.25% 1,600,200 0.25% 1,604,300 0.26% 1,608,606 0.27% 123,900 8.35% BLACK & VEATCH I Appendix 1: Water Tables Page 197 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 6 - Water Capital Improvement Program 1 2 Water System Rehabilitation/Replacement Water Tank Improvements 2,060,000 1,030,000 0 1,060,900 2,185,500 1,092,700 2,251,000 1,125,500 2,318,500 1,159,300 0 2,149,300 3 Water Storage & Pump Station Maintenance 103,000 106,100 109,300 112,600 115,900 0 4 Water Meters 849,800 875,200 901,500 928,500 956,400 0 5 Backflow Prevention Assemblies 51,500 53,000 54,600 56,300 58,000 0 6 W/S Improvements defined by Study (West Water Transmission Line) 618,000 636,500 655,600 675,300 695,600 4,776,200 7 Water Impact Fee Improvements 412,000 424,400 437,100 450,200 463,700 0 8 Utilities Financial Services Improvements 0 11,100 3,300 1,700 8,700 0 9 Water/Sewer Relocations - Bond Projects 174,600 265,200 273,200 281,400 289,800 0 10 Water/Sewer Impact Fee Cost Sharing 0 79,600 82,000 84,400 86,900 0 11 Utilities Technology Improvements 0 228,100 234,900 130,000 10,400 0 12 Water/Sewer Building -Office Improvements 0 26,500 27,300 28,100 29,000 0 13 Water/Sewer Equipment Expansions 0 26,500 27,300 28,100 29,000 0 14 Water & Sewer Rate/Operational Studies 0 10,600 10,900 11,300 11,600 0 15 Phosphorus Standards Management 0 26,500 27,300 28,100 29,000 0 16 Water & Sewer Technology Equipment Replacements 0 0 0 0 0 0 17 Water & Sewer Improvements Defined By Study 0 0 0 0 0 0 18 Huntsville Water Line Replacement (6-inch upto 8-inch) 776,300 0 0 0 0 0 19 Benson Water Tank 1,030,000 338,200 0 0 0 0 20 East Water Service Improvements - Township 3,290,600 0 0 0 0 0 21 South Garland Ave Waterline Replacement 253,800 0 0 0 0 0 22 East Water Service Improvements CS 3 (Gulley, PS, Goshen Lines) 0 5,304,500 0 0 0 0 23 Ila/Oaks Manor/Persimmon Waterline Replacements 927,000 0 0 0 0 0 24 25 Western Park Waterline Replacement N. College Waterline Replacement - upgrade from 8" to 12" 309,000 0 0 0 0 2,185,400 0 0 0 0 0 0 26 Total Capital Improvement Program 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 (a) Capital costs reflect 3% annual inflation starting in 2021. Table W - 7 - Water Projected O&M Expenses 1 Personal Costs 3,433,300 3,579,400 3,731,900 3,890,900 4,056,700 4,229,700 2 Materials and Supplies 968,000 997,000 1,026,900 1,057,700 1,089,500 1,122,100 3 Services and Charges 9,994,400 10,294,200 10,603,100 10,921,100 11,248,800 11,586,200 4 Motorpool 837,000 862,100 888,000 914,600 942,100 970,300 5 Cost Allocation 631,100 650,000 669,500 689,600 710,300 731,600 6 Maintenance 85,800 88,400 91,100 93,800 96,600 99,500 7 8 Total % Change 15,949,600 1.91% 16,471,100 3.27% 17,010,500 3.27% 17,567,700 3.28% 18,144,000 3.28% 18,739,400 3.28% BLACK & VEATCH I Appendix 1: Water Tables Page 198 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 8 - Capital Program Financing S S S S S S Sources of Funds 1 Funds Available at Beginning of Year 500,200 506,800 501,700 501,700 503,600 508,700 2 Cash Financing of Capital Projects 5,460,000 9,050,000 6,860,000 6,110,000 6,180,000 6,920,000 3 Transfer from Impact Fee Fund 6,432,200 417,800 1,447,900 84,400 86,900 0 4 Subtotal 12,392,400 9,974,600 8,809,600 6,696,100 6,770,500 7,428,700 Application of Funds 5 Major Capital Improvements 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 6 Subtotal 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 7 End of Year Balance 506,800 501,700 501,700 503,600 508,700 503,200 8 Capital Reserve ECY Balance - Cumulative 12,915,000 8,453,000 6,559,000 5,789,000 5,359,000 4,634,000 BLACK & VEATCH I Appendix 1: Water Tables 10-6 Page 199 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 9 - Water Operating Cash Flow S S S S S S Revenues 1 Revenue Under Existing Rates 21,186,600 21,800,700 22,087,800 22,381,200 22,680,800 22,986,900 Indicated Revenue Increases 2 0% Increase Effective January 1, 2022 0 0 0 0 0 3 3 % Increase Effective January 1, 2023 0 607,400 671,400 680,400 689,600 4 3 % Increase Effective January 1, 2024 0 0 633,900 700,800 710,300 5 3 % Increase Effective January 1, 2025 0 0 0 661,700 731,600 6 3% Increase Effective January 1, 2026 0 0 0 0 690,800 7 Total Revenue from Rates 21,186,600 21,800,700 22,695,200 23,686,500 24,723,700 25,809,200 8 Other Revenues (a) 533,100 641,500 647,100 653,100 659,300 665,900 9 Total Revenue 21,719,700 22,442,200 23,342,300 24,339,600 25,383,000 26,475,100 10 Expenses Operating Expenses 15,949,600 16,471,100 17,010,500 17,567,700 18,144,000 18,739,400 11 Bad Debt 105,900 109,000 113,500 118,400 123,600 129,000 12 PILOT 900,400 926,500 964,500 1,006,700 1,050,800 1,096,900 13 Safe Drinking Water Fee 230,000 233,800 237,800 241,800 245,900 250,200 14 Debt Service 0 0 0 0 0 0 15 Total Expenses 17,185,900 17,740,400 18,326,300 18,934,600 19,564,300 20,215,500 Transfers 16 Transfer to Shop Fund 33,000 0 0 0 0 0 17 Transfer to Operating Reserve 128,600 133,000 137,400 142,100 146,800 151,800 18 Cash Financing of Capital 5,460,000 9,050,000 6,860,000 6,110,000 6,180,000 6,920,000 19 Transfer to/from Capital Reserve -1,093,000 -4,476,000 -1,980,500 -850,000 -510,000 -810,000 20 Total Transfers 4,528,600 4,707,000 5,016,900 5,402,100 5,816,800 6,261,800 Fund Balance 21 Beginning Balance 100,900 106,100 100,900 100,000 102,900 104,800 22 Annual Operating Balance 5,200 -5,200 -900 2,900 1,900 -2,200 23 Ending Fund Balance 106,100 100,900 100,000 102,900 104,800 102,600 Performance Metrics 24 Debt Service Coverage NA NA NA NA NA NA 25 O&M Reserve Balance (Days) (b) a 900 90 0 90 j 90 (j 90 `} 90 (a) Includes interest income on operating fund balance. (b) Mininum requirement is 90 days of following year's Operating Expenses. BLACK & VEATCH I Appendix 1: Water Tables Page 200 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 10 - Water Fund Balances S S $ S S $ Operating Funds 1 0&M Reserve Balance (a) 4,061,400 4,194,400 4,331,800 4,473,900 4,620,700 4,772,500 2 Operating Fund Balance (b) 106,100 100,900 100,000 102,900 104,800 102,600 3 Total (e) 4,167,500 4,295,300 4,431,800 4,576,800 4,725,500 4,875,100 Capital Funds 4 Capital Fund Balance (c) 506,800 501,700 501,700 503,600 508,700 503,200 5 Capital Reserve Fund Balance (d) 12,915,000 8,439,000 6,458,500 5,608,500 5,098,500 4,288,500 6 Total (e) 13,421,800 8,940,700 6,960,200 6,112,100 5,607,200 4,791,700 7 Impact Fee Fund Balance (e) 22,800 581,300 109,700 1,001,600 1,891,000 2,867,300 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target mininum balance is $100,000 to account for any adjustments that may be needed to the O&M balance at the end of the year. (c) Target mininum balance is $500,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. BLACK & VEATCH I Appendix 1: Water Tables 10-8 Page 201 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 11 - Water 2022 Cost of Service S S S Statement of Net Revenue Requirements (Cash Basis) Revenue Requirements 1 O&M Expenses 16,471,100 16,471,100 2 Bad Debt Expense 109,000 109,000 3 PI LOT 926,500 926,500 4 Debt Service 0 0 Other Expenditures & Transfers: Transfer to Shop Fund (Capital Outlay) 5 Transfer to Operating Reserve 133,000 133,000 6 Cash Funding of Capital Projects 9,050,000 9,050,000 7 Transfer to Capital Reserve -4,476,000-4,476,000 8 Subtotal 17,639,600 4,574,000 22,213,600 Less Revenue Requirements Met from Other Sources 9 Other Revenues 382,100 382,100 10 Interest Earned 11 Net Balance Available 25,600 25,600 5,200 5,200 12 Full Year Rate Adjustment 13 Subtotal 407,700 5,200 412,900 14 Net Revenue Requirements to be Recovered by Rates 17,231,900 4,568,800 21,800,700 Restatement of Net Cost of Service (Utility Basis) 15 O&M Expenses 16 Depreciation 17 Return 18 Net Cost of Service 17,231,900 17,231,900 2,672,900 2,672,900 1,895,900 1,895,900 17,231,900 4,568,800 21,800,700 BLACK & VEATCH I Appendix 1: Water Tables Page 202 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 12 - Water 2022 Allocation of Net Plant Investment to Functional Cost Components s s s s s s s s s s Net Plant Investment: 1 Water Land and Land Rights 2,191,756 1,043,693 1,148,063 2 Water Supply 6,819,846 3,247,546 3,572,300 3 Water Storage and Pumping 4,921,351 2,343,501 2,577,851 4 Water Transmission 23,254,954 11,073,788 12,181,167 5 Water Distribution 44,985,690 16,478,275 9,063,051 5,190,657 14,253,708 6 Water Meters 2,811,340 2,811,340 7 Fire Hydrants 7,535,573 7,535,573 8 Water General System 3,714,721 616,910 678,600 755,699 467,385 208,406 685,166 302,555 9 Total Net Plant Investment 96,235,232 15,981,936 17,580,130 0 19,577,474 12,108,287 5,399,063 17,750,214 0 7,838,128 Table W - 13 - Water 2022 Allocation of Net Annual Depreciation to Functional Cost Components s s s s s s s s s s Net Depreciation Expense: 1 Water Land and Land Rights 2 Water Supply 277,295 132,045 145,250 3 Water Storage and Pumping 186,149 88,642 97,507 4 Water Transmission 653,961 311,410 342,551 5 Water Distribution 1,087,773 398,452 219,148 125,512 344,661 6 Water Meters 154,018 154,018 7 Fire Hydrants 215,879 215,879 8 Water General System 97,807 16,843 18,528 18,501 12,027 4,767 18,941 8,200 9 Total Net Depreciation Expense 2,672,882 460,299 506,328 0 505,595 328,682 130,280 517,620 0 224,078 Table W - 14 - Water 2022 Allocation of O&M Expenses to Functional Cost Components s s s s s s s s s s s 1 Water Purchased Max Day 9,331,800 4,443,724 4,888,086 2 Water Storage and Pumping Max Hour 259,914 95,207 104,727 59,980 3 Water Distribution (a) Max Hour 3,000,220 971,472 1,208,880 692,358 97,507 30,002 4 Meter Services(b) Direct 968,983 968,983 5 Customer Billing(c) Direct 1,012,574 1,012,574 6 All Other Cost Proportion of All 3,066,109 934,911 1,028,402 224,418 276,369 158,294 203,864 213,035 20,514 6,312 7 subtotal 17,639,600 5,378,625 5,916,488 0 1,291,097 1,589,976 910,623 1,172,947 1,225,609 118,022 36,314 Less: 8 Water Connection Fees(d) 164,700 164,700 9 Other Income Sources 243,000 90,252 81,504 17,786 21,903 12,545 16,884 1,626 Soo 10 Subtotal 407,700 90,252 81,504 17,786 21,903 12,545 164,700 16,894 1,626 500 11 Net O&M Expenses 17,231,900 5,298,373 5,834,983 1,273,311 1,568,073 898,078 2,008,147 1,208,725 116,396 35,814 (a) 3.25%of 2020 water repair costs was associated with hydrants. (b) Includes costs for Meter Reading and Meter Maintenance and Backflow prevention (c) Includes costs under Utilities Financial Services (d) Includes revenues from Water Connection Fees and Rural Water Connection Fees BLACK & VEATCH I Appendix 1: Water Tables 10-10 Page 203 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 15 - Water 2022 Estimated Units of Service 1,000 ga 1. 1,000 gal. 1,000 gal. 1,000 ga 1. 1,000 gal. 1,000 gal. Equiv. Meters Bills Equiv. Hydrants Equiv. Hydrants (1)/365 (2) x (3) (4)-(2) (2) x (6) (7) - (4) Inside City 1 Residential 1,769,829 4,849 250% 12,122 7,273 370% 17,941 5,819 34,939 429,673 2 Non -Residential 827,079 2,266 240% 5,438 3,172 355% 8,044 2,606 6,761 41,712 3 Industrial 401,767 1,101 200% 2,201 1,101 295% 3,247 1,046 261 252 4 Irrigation 244,282 669 240% 1,606 937 355% 2,376 770 3,141 24,897 5 Subtotal 3,242,957 8,885 21,368 12,483 31,608 10,240 45,102 496,534 Fire Protection 6 Public 4,201 4,201 10,083 5,882 4,035 7 Private 491 491 1,179 688 472 8 Subtotal 3,242,957 8,885 26,060 17,175 42,870 16,810 45,102 496,534 4,035 472 Outside City Farmington 9 Residential 83,821 230 250% 574 344 370% 850 276 1,762 23,207 10 Non -Residential 17,003 47 240% 112 65 355% 165 54 245 2,315 11 Industrial 200% 295% 12 Irrigation 1,336 4 240% 9 5 355% 13 4 46 472 13 Subtotal 102,160 280 695 415 1,028 333 2,053 25,995 Greenland 14 Residential 19,818 54 250% 136 81 370% 201 65 458 5,676 15 Non -Residential 4,298 12 240% 28 16 355% 42 14 59 588 16 Industrial 200% 295% 17 Irrigation 1,230 3 240% 8 5 355% 12 4 20 96 18 Subtotal 25,345 69 172 103 255 83 537 6,360 Washington County/Growth 19 Residential 194,707 533 250% 1,334 800 370% 1,974 640 2,618 33,792 20 Non -Residential 24,123 66 240% 159 93 355% 235 76 109 1,368 21 Industrial 200% 295% 22 Irrigation 14,323 39 240% 94 55 355% 139 45 188 1,851 23 Subtotal 233,153 639 1,586 948 2,348 761 2,915 37,012 Johnson 24 Residential 6,718 18 250% 46 28 370% 68 22 158 2,064 28 Non -Residential 8,320 23 240% 55 32 355% 81 26 35 240 29 Industrial 200% 295% 30 Irrigation 77 0 240% 1 0 355% 1 0 3 24 31 Subtotal 15,115 41 101 60 150 49 196 2,328 Goshen/White River 32 Residential 80,631 221 250% 552 331 370% 817 265 1,054 14,712 33 Non -Residential 11,837 32 240% 78 45 355% 115 37 52 768 34 Industrial 200% 295% 35 Irrigation 7,411 20 240% 49 28 355% 72 23 86 886 36 Subtotal 99,879 274 679 405 1,005 326 1,192 16,366 Fire Protection 37 Public 696 696 1,669 973 668 38 Private 12 12 29 17 12 39 Subtotal 475,651 1,303 3,941 2,638 6,483 2,541 6,892 88,060 668 12 40 Total Retail 3,718,609 10,188 30,001 19,813 49,353 19,351 51,994 594,594 Wholesale 41 Elkins 75,031 206 240% 493 288 355% 730 236 23 12 42 Mount Olive 62,062 170 240% 408 238 355% 604 196 38 24 43 West Fork 65,226 179 240% 429 250 355% 634 206 23 12 44 RDA/WWA 240% 355% 48 45 Subtotal 202,319 554 1,330 776 1,968 637 83 96 46 Subtotal (Inside City) 3,242,957 8,885 26,060 17,175 42,870 16,810 45,102 496,534 4,035 472 47 Subtotal (Outside City) 475,651 1,303 3,941 2,638 6,483 2,541 6,892 88,060 668 12 48 Subtotal (Wholesale) 202,319 554 1,330 776 1,968 637 83 96 49 Total System 3,920,928 20,742 31,332 20,589 51,320 19,989 52,077 584,690 4,703 483 BLACK & VEATCH I Appendix 1: Water Tables 10-11 Page 204 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 16 - Water 2022 Unit Cost of Service $ 1,000 gal. 1,000 glad. 1,000 gpd. 1,000 gal. 1,000 gpd. 1,000 gpd. Equiv. Meters Bills Hydrants Hydrants Units of Service 1 Inside City 3,242,957 17,175 16,810 3,242,957 17,175 16,810 45,102 496,534 4,035 472 2 Outside City 677,970 3,414 3,179 475,651 2,638 2,541 6,975 88,156 668 12 3 Total System 3,920,928 20,589 19,989 3,718,609 19,813 19,351 52,077 584,690 4,703 483 Costs of Service Net Operating Costs 4 Total -$ 17,231,900 5,288,373 5,834,983 0 1,273,311 1,568,073 898,078 1,008,147 1,208,725 116,396 35,814 5 Unit Cost- $/unit 1.35 283.40 0.00 0.34 79.14 46.41 19.36 2.07 24.75 74.09 Depreciation Expense 6 Total -$ 2,672,882 460,299 506,328 0 505,595 328,682 130,280 517,620 224,078 7 Unit Cost - $/unit 0.12 24.59 0.00 0.14 16.59 6.73 9.94 47.65 Net Plant Investment 8 Total- $ 96,235,232 15,981,936 17,580,130 0 19,577,474 12,108,287 5,399,063 17,750,214 7,838,128 9 Unit Cost - $/unit 4.08 853.84 0.00 5.26 611.12 279.00 340.84 1,666.62 Return on Investment 10 Inside City, Unit Return - $/unit 0.05 9.51 0.00 0.06 6.81 3.11 3.80 18.57 11 Outside City, Unit Return - $/Unit 0.29 59.77 0.00 0.37 42.78 19.53 23.86 116.66 Total Return 12 Inside City -$ 916,284 147,274 163,391 0 190,223 116,943 52,254 171,276 74,925 13 Outside City- $ 979,634 193,441 204,057 0 175,292 112,852 49,635 166,424 77,931 14 Total Return -$ 1,895,918 340,715 367,448 0 365,515 229,795 101,889 337,700 152,856 Total Unit Cost of Service 15 Inside City Unit Cost - $/unit 1.51 317.50 0.00 0.54 102.54 56.25 33.10 2.07 90.96 74.09 16 Outside City Unit Cost - $/unit 1.75 367.76 0.00 0.85 138.51 72.67 53.16 2.07 189.06 74.09 17 Inside City - Cost of Service -$ 17,724,585 4,901,939 5,453,197 0 1,741,586 1,761,152 945,554 1,492,679 1,026,480 367,039 34,959 18 Outside City -Cost of Service -$ 4,076,115 1,187,448 1,255,563 0 402,934 365,399 184,692 370,787 182,245 126,291 855 19 Total Cost of Service - $ 21,800,700 6,089,387 6,708,760 0 2,144,421 2,126,550 1,130,246 1,863,466 1,208,725 493,330 35,814 BLACK & VEATCH I Appendix 1: Water Tables 10-12 Page 205 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 17 - Water 2022 Cost of Service by Customer Class Inside City 1 Residential 9,052,600 1,487,900 10,540,500 11,001,700 -4.2% 2 Non -Residential 3,483,400 572,500 4,056,000 3,476,000 16.7% 3 Industrial 1,353,400 222,400 1,575,800 1,196,700 31.7% 4 Irrigation 1,092,700 179,600 1,272,300 1,431,200 -11.1% Fire Protection 5 Public 2,462,500 -2,462,500 6 Private 279,900 279,900 967,600 -71.1% 7 Subtotal 17,724,500 -100 17,724,500 18,073,200 -1.9% Outside City 8 Residential 2,382,600 455,400 2,838,000 2,614,600 8.5% 9 Non -Residential 350,300 66,900 417,200 328,200 27.1% 10 Industrial 0.0% 11 Irrigation 141,400 27,000 168,400 173,400 -2.9% Fire Protection 12 Public 549,400 -549,400 13 Private 8,200 8,200 27,100 -69.7% 14 Subtotal 3,431,900 -100 3,431,800 3,143,300 9.2% Wholesale 15 Elkins 238,500 238,500 216,200 10.3% 16 Mount Olive 198,300 198,300 179,800 10.3% 17 West Fork 207,500 207,500 188,100 10.3% 18 RDA/WWA 0 0 0 0.0% 19 Subtotal Wholesale 644,300 0 644,300 584,100 10.3% 20 Total Retail 21,156,400 -200 21,156,300 21,216,500 -0.3% 21 Total Wholesale 644,300 0 644,300 584,100 10.3% 22 Total 21,800,700 -200 21,800,600 21,800,600 0.0% BLACK & VEATCH I Appendix 1: Water Tables 10-13 Page 206 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 18 - Water Proposed 2022 Rates Existing Water Rates Effective January 1, 2022 ����Monthly Base Charge Proposed Water Rates Effective August 1, 2022 nnnmr"� Monthly Base Charge Meter Size City Inches $/month Outside C ity $/month Wholesale $/month Inside City Private Fire $/month Outside City Private Fire $/month Inside Meter Size City Inches $/month Outside City $/month Wholesale $/month Inside City Private Fire $/month Outside Private Fire $/month 5/8 6.59 7.54 8.31 5/8 6.59 7.54 8.31 3/4 6.59 7.54 8.31 3/4 6.59 7.54 8.31 1 9.14 10.52 11.49 9.75 11.68 1 9.14 12.26 12.26 9.75 11.68 1 1/2 15.93 18.31 20.00 10.17 12.10 1 1/2 15.93 24.22 24.22 10.17 12.10 2 23.20 26.66 29.07 20.33 23.37 2 23.20 33.52 33.52 20.33 23.37 3 54.05 62.18 64.38 30.48 35.06 3 54.05 69.84 69.84 30.48 35.06 4 89.50 102.93 112.25 60.97 70.11 4 89.50 102.93 112.25 60.97 70.11 6 178.99 205.82 212.76 169.34 197.74 6 178.99 205.82 212.76 169.34 197.74 8 268.41 308.67 332.91 355.65 409.00 8 268.41 308.67 332.91 355.65 409.00 10 609.68 701.11 10 609.68 701.11 Charge Volume Charge Monthly Water Usage 1,000 gal. Inside city 1,000 gal. OutsideVolume city 1,000 gal. Wholesale 1,000 gal. Monthly Water GWIIWq��MMMMWhMol 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential Residential 0 - 2,000 Gallons 3.51 4.04 0 - 2,000 Gallons 3.30 4.47 2,000 - 15,000 Gallons 4.65 5.35 2,000 - 15,000 Gallons 4.37 5.91 Over 15,000 Gallons 6.59 7.54 Over 15,000 Gallons 6.20 8.38 Non -Residential Non -Residential First 300,000 Gallons 3.79 4.38 First 300,000 Gallons 3.93 5.05 Over 300,000 Gallons 3.39 3.90 Over 300,000 Gallons 3.93 5.05 Major Industrial Major Industrial All Usage 2.96 3.40 All Usage 3.14 3.49 Irrigation Irrigation First 300,000 Gallons 5.04 5.80 First 300,000 Gallons 4.29 5.43 Over 300,000 Gallons 4.53 5.22 Over 300,000 Gallons 4.29 5.43 Wholesale Wholesale Reduced Peak Demand 2.87 Reduced Peak Demand 3.16 Peak Demand 3.20 Peak Demand 3.16 BLACK & VEATCH I Appendix 1: Water Tables 10-14 Page 207 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 19 - Water 2022 Cost of Service Under Proposed Rates 1 Inside City Residential S 10,540,500 S 11,001,700 -4.2% S 10,541,600 100.0% -4.2% S -460,100 2 Non -Residential 4,056,000 3,476,000 16.7% 3,687,200 90.9% 6.1% 211,200 3 Industrial 1,575,800 1,196,700 31.7% 1,272,200 80.7% 6.3% 75,500 4 Irrigation 1,272,300 1,431,200 -11.1% 1,272,500 100.0% -11.1% -158,700 5 6 Subtotal Outside City Residential 17,444,600 2,838,000 17,105,600 2,614,600 2.0% 8.5% 16,773,500 2,838,400 96.2% 100.0% -1.9% 8.6% -332,100 223,800 7 Non -Residential 417,200 328,200 27.1% 381,900 91.5% 16.4% 53,700 8 Irrigation 168,400 173,400 -2.9% 168,500 100.1% -2.8% -4,900 9 10 Subtotal Private Fire Inside City 3,423,600 279,900 3,116,200 967,600 9.9% -71.1% 3,388,800 967,600 99.0% 345.7% 8.7% 0.0% 272,600 0 11 Outside City 8,200 27,100 -69.7% 27,100 330.5% 0.0% 0 12 13 Subtotal Wholesale Elkins 288,100 238,500 994,700 216,200 -71.0% 10.3% 994,700 238,400 345.3% 100.0% 0.0% 10.3% 0 22,200 14 Mount Olive 198,300 179,800 10.3% 198,300 100.0% 10.3% 18,500 15 West Fork 207,500 188,100 10.3% 207,500 100.0% 10.3% 19,400 16 RDA/WWA 0 0 0 0.0% 0.0% 17 18 Subtotal Total 644,300 21,800,600 584,100 21,800,600 10.3% 0.0% 644,200 21,801,200 100.0% 100.0% 10.3% 0.0% 60,100 600 BLACK & VEATCH I Appendix 1: Water Tables 10-15 Page 208 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 20 - Water 2022 Bill Impact Line No. Residential 1 Meter Size 3/4 Monthly Usage 1,000gal. 0.5 Existing Rates $ 9.91 Inside City Proposeim����r Rates $ 8.24 Decrease $ -1.67 Decrease -16.9% Existing Rates $ 11.36 Outside Proposed Rates $ 9.78 City Increase / Decrease $ -1.59 Increase Decrease -14.0% 2 3/4 2 13.42 13.19 -0.23 -1.7% 15.40 16.48 1.08 7.0% 3 3/4 4 22.72 21.93 -0.79 -3.5% 26.10 28.30 2.20 8.4% 4 3/4 8 41.32 39.41 -1.91 -4.6% 47.50 51.94 4.44 9.3% 5 3/4 10 50.62 48.15 -2.47 -4.9% 58.20 63.76 5.56 9.6% 6 3/4 15 73.87 70.00 -3.87 -5.2% 84.95 93.31 8.36 9.8% Non -Residential 7 3/4 10 44.30 45.89 1.59 3.6% 51.12 58.04 6.92 13.5% 8 3/4 20 82.20 85.19 2.99 3.6% 94.92 108.54 13.62 14.3% 9 1 50 198.37 205.64 7.27 3.7% 229.21 264.76 35.55 15.5% 10 1 100 387.87 402.14 14.27 3.7% 448.21 517.26 69.05 15.4% 11 11/2 50 204.97 212.43 7.46 3.6% 236.78 276.72 39.94 16.9% 12 1 1/2 100 394.47 408.93 14.46 3.7% 455.78 529.22 73.44 16.1% 13 2 100 401.52 416.20 14.68 3.7% 463.88 538.52 74.64 16.1% 14 2 500 1,837.52 1,988.20 150.68 8.2% 2,119.88 2,558.52 438.64 20.7% Industrial 15 2 100 318.52 337.20 18.68 5.9% 362.52 382.52 20.00 5.5% 16 2 1,000 2,982.52 3,163.20 180.68 6.1% 3,422.52 3,523.52 101.00 3.0% 17 4 500 1,566.89 1,659.50 92.61 5.9%1 1,786.89 1,847.93 61.04 3.4% 18 4 1,500 4,526.89 4,799.50 272.61 6.0%1 5,186.89 5,337.93 151.04 2.9% 19 6 2,500 7,573.78 8,028.99 455.21 6.0% 8,673.78 8,930.82 257.04 3.0% 20 6 5,000 14,973.78 15,878.99 905.21 6.0%1 17,173.78 17,655.82 482.04 2.8% 21 6 10,000 29,773.78 31,578.99 1,805.21 6.1%1 34,173.78 35,105.82 932.04 2.7% BLACK & VEATCH I Appendix 1: Water Tables 10-16 Page 209 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 11.0 Appendix 2: Wastewater Tables Table S - 1 - Wastewater Projected Accounts Inside City 1 Residential 34,600 35,200 35,800 36,400 37,000 37,700 2 Non -Residential 2,900 2,900 2,900 2,900 2,900 2,900 3 Industrial 21 21 21 21 21 21 4 Subtotal 37,521 38,121 38,721 39,321 39,921 40,621 Outside City 5 Residential 2,400 2,400 2,500 2,500 2,500 2,500 6 Non -Residential 184 184 184 184 184 184 7 Industrial 0 0 0 0 0 0 8 Subtotal 2,584 2,584 2,684 2,684 2,684 2,684 Wholesale 9 Elkins 2 2 2 2 2 2 10 West Fork 1 1 1 1 1 1 11 Subtotal 2 2 2 2 2 2 11 Total 40,107 40,707 41,407 42,007 42,607 43,307 12 %Change 1.52% 1.50% 1.72% 1.45% 1.43% 1.64% Table S - 2 - Wastewater Projected Billed Volume (1,000 Gallons) 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Inside City 1 Residential 1,861,300 1,741,200 1,771,800 1,802,800 1,834,400 1,866,500 2 Non -Residential 626,900 698,700 698,600 698,600 698,600 698,600 3 Industrial 318,500 396,700 396,700 396,700 396,700 396,700 4 Subtotal 2,806,700 2,836,600 2,867,100 2,898,100 2,929,700 2,961,800 Outside City 5 Residential 94,500 97,400 98,700 100,100 101,400 102,800 6 Non -Residential 15,300 15,000 15,000 15,000 15,000 15,000 7 Industrial 0 0 0 0 0 0 8 Subtotal 109,800 112,400 113,700 115,100 116,400 117,800 Wholesale 8 Elkins 81,000 81,000 81,000 81,000 81,000 81,000 9 West Fork 45,600 45,600 45,600 45,600 45,600 45,600 10 Subtotal 126,600 126,600 126,600 126,600 126,600 126,600 10 Total 3,043,100 3,075,600 3,107,400 3,139,800 3,172,700 3,206,200 11 %Change 2.30% 1.07% 1.03% 1.04% 1.05% 1.06% 0 0 3,100 100 0 0 0 3,200 7.98% 155,100 8,300 -300 0 8,000 0 0 0 163,100 5.36% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 210 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 3 - Wastewater Existing Charges Existing Wastewater Rates Effective January 1, 2022 Inches 5/8 $/month 18.28 $/month 18.28 $/month 16.74 3/4 18.28 18.28 16.74 1 23.74 33.92 31.28 1 1/2 38.77 60.37 55.50 2 55.43 79.73 73.45 3 128.73 184.24 169.29 4 212.13 303.44 278.93 6 8 420.39 628.73 601.46 899.76 553.70 826.81 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential First 2,000 Gallons 4.35 > 2,000 Gallons 5.80 All Usage 8.18 7.52 Non -Residential All Usage 4.40 8.18 7.52 Major Industrial All Usage 4.71 8.18 7.52 Wholesale 85% of metered water usage 5.19 Above 85% of metered water 2.71 Surcharge BOD - $/Ib for strength in excess of 300 ppm 0.4352 T55 - $/Ib for strength in excess of 300 ppm 0.3056 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 211 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 4 - Wastewater Projected Revenues at Existing Rates S S S S S S Inside City 1 Residential 16,696,700 16,719,800 17,013,000 17,310,700 17,613,700 17,921,900 2 Non -Residential 3,505,200 3,926,200 3,926,100 3,926,100 3,926,100 3,926,100 3 Industrial 1,477,500 1,890,100 1,890,100 1,890,100 1,890,100 1,890,100 4 Subtotal 21,679,400 22,536,100 22,829,200 23,126,900 23,429,900 23,738,100 Outside City 5 Residential 1,177,400 1,242,000 1,258,300 1,274,800 1,291,700 1,308,800 6 Non -Residential 158,100 160,400 160,400 160,400 160,400 160,400 7 Industrial 0 0 0 0 0 0 8 Subtotal 1,335,500 1,402,400 1,418,700 1,435,200 1,452,100 1,469,200 Wholesale 9 Elkins 407,300 419,500 419,500 419,500 419,500 419,500 10 West Fork 229,400 236,200 236,200 236,200 236,200 236,200 11 Subtotal 636,700 655,700 655,700 655,700 655,700 655,700 12 Surcharge 810,300 834,600 834,600 834,600 834,600 834,600 13 Total 24,461,900 25,428,800 25,738,200 26,052,400 26,372,300 26,697,600 14 %Change 4.90% 3.95% 1.22% 1.22% 1.23% 1.23% (a) Reflects 3.0% revenue increase effective January 1, 2022. Table S - 5 - Wastewater Projected Other Revenues S S S S S S 1 Sewer Impact Fee Rev 743,900 743,900 743,900 743,900 743,900 743,900 2 Sewer Sales Not on Cc 11,800 11,800 11,800 11,800 11,800 11,800 3 Sewer Connection Fee 47,900 47,900 47,900 47,900 47,900 47,900 4 WWTP Hay Sales 134,800 134,800 134,800 134,800 134,800 134,800 5 WWTP Biosolids/Fertil 54,900 54,900 54,900 54,900 54,900 54,900 6 WWTP Water Treatme 180,800 180,800 180,800 180,800 180,800 180,800 7 Penalties 123,000 246,100 246,100 246,100 246,100 246,100 8 Total 1,297,100 1,420,200 1,420,200 1,420,200 1,420,200 1,420,200 9 %Change -1.52% 9.49% 0.00% 0.00% 0.00% 0.00% 2,058,700 0 6,800 19,000 24,300 2,235,700 9.14% 0 0 0 0 0 0 123,100 123,100 9.49% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 212 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 6 - Wastewater Capital Improvement Program 1 Sanitary Sewer Rehabilitation 2,956,100 3,044,800 3,136,100 3,230,200 3,327,100 0 2 Plant Pumps and Equipment- W.W.T.P. 515,000 530,500 546,400 562,800 579,600 0 3 W.W.T.P. Building Improvements 1,699,500 1,750,500 163,900 168,800 173,900 0 4 Upgrade/Replace Lift Stations -W.W.T.P. 309,000 318,300 327,800 337,700 347,800 0 5 Lake Sequoyah Sediment Removal/Dredging 515,000 530,500 546,400 562,800 579,600 0 6 Wastewater Treatment/Water Quality Improvement! 103,000 106,100 109,300 112,600 115,900 0 7 Wastewater Impact Fee Improvements 309,000 318,300 327,800 337,700 347,800 0 8 Utilities Financial Services Improvements 0 11,100 3,300 1,700 8,700 0 9 Water/Sewer Relocations - Bond Projects 174,600 265,200 273,200 281,400 289,800 0 10 Water/Sewer Impact Fee Cost Sharing 0 79,600 82,000 84,400 86,900 0 11 Utilities Technology Improvements 0 228,100 234,900 130,000 10,400 0 12 Water/Sewer Building -Office Improvements 0 26,500 27,300 28,100 29,000 0 13 Water/Sewer Equipment Expansions 0 26,500 27,300 28,100 29,000 0 14 Water & Sewer Rate/Operational Studies 0 10,600 10,900 11,300 11,600 0 15 Phosphorus Standards Management 0 26,500 27,300 28,100 29,000 0 16 Water & Sewer Technology Equipment Replacements 0 0 0 0 0 0 17 Water & Sewer Improvements Defined By Study 0 0 0 0 0 0 18 Biosolids Dryer Replacement 0 0 3,278,200 9,004,100 9,274,200 9,552,400 19 Filter Cell Upgrade/Replacement at Noland WWTP 0 0 0 0 0 1,432,900 20 Upgrade Automation at both WWTPs 0 0 0 0 0 1,671,700 21 CIPP of 36" Sewer Line from Armstrong Ave to Nolan 0 0 0 0 0 1,194,100 22 23 Bypass Sewer Fulbright & North Gregg Hamestring Lift Station Bottle Neck Resolution 1,442,000 0 0 848,700 0 0 0 0 0 0 0 0 24 Total Capital Improvement Program 8,023,200 8,121,800 9,122,200 14,909,800 15,240,300 13,852,100 (a) Capital costs reflect 3% annual inflation starting in 2021. Table S - 7 - Wastewater Projected O&M Expenses 1 Personal Costs 3,075,500 3,206,500 3,343,100 3,485,600 3,634,300 3,789,400 2 Materials and Supplies 724,700 746,500 768,900 791,900 815,700 840,200 3 Services and Charges 6,081,000 6,263,500 6,451,400 6,644,900 6,844,300 7,049,600 4 WWTP Contract 3,995,600 4,115,500 4,238,900 4,366,100 4,497,100 4,632,000 5 Motorpool 1,032,500 1,063,500 1,095,400 1,128,300 1,162,100 1,197,000 6 Cost Allocation 680,700 701,200 722,200 743,900 766,200 789,200 7 Maintenance 84,800 87,400 90,000 92,700 95,500 98,300 8 Total 15,674,800 16,184,100 16,709,900 17,253,400 17,815,200 18,395,700 Change 0.81% 3.25% 3.25% 3.25% 3.26% 3.26% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 213 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 8 - Wastewater Cash Financed Capital Sources of Funds 1 Funds Available at Beginning of Year 504,100 501,900 506,700 504,400 506,700 501,100 2 Cash Financing of Capital Projects 6,270,000 6,880,000 8,710,000 14,490,000 14,800,000 13,850,000 3 Transfer from Impact Fee Fund 1,751,000 1,246,600 409,800 422,100 434,700 0 4 Subtotal 8,525,100 8,628,500 9,626,500 15,416,500 15,741,400 14,351,100 Application of Funds 5 Major Capital Improvements 8,023,200 8,121,800 9,122,100 14,909,800 15,240,300 13,851,100 6 Subtotal 8,023,200 8,121,800 9,122,100 14,909,800 15,240,300 13,851,100 7 End of Year Balance 8 Capital Reserve EOY Balance - Cumulative Table S - 9 - Wastewater Operating Cash Flow 501,900 506,700 504,400 506,700 501,100 500,000 19,995,000 21,737,000 22,105,000 17,205,000 12,555,000 9,445,000 1 Revenues Revenues Under Existing Rates 24,461,900 25,428,800 25,738,200 26,052,500 26,372,200 26,697,600 2 Revenue Increases 0% Increase Effective January 1, 2022 0 0 0 0 0 3 3 % Increase Effective January 1, 2023 0 707,800 781,600 791,200 800,900 4 3 % Increase Effective January 1, 2024 0 0 737,900 814,900 825,000 5 3 % Increase Effective January 1, 2025 0 0 0 769,400 849,700 6 3% Increase Effective January 1, 2026 0 0 0 0 802,300 7 8 Total Revenue from Rates Other Revenues (a) 24,461,900 594,700 25,428,800 720,500 26,446,000 722,700 27,572,000 725,400 28,747,700 728,200 29,975,500 731,200 9 Total Revenues 25,056,600 26,149,300 27,168,700 28,297,400 29,475,900 30,706,700 10 Expenses Operating Expenses 15,674,800 16,184,100 16,709,900 17,253,400 17,815,200 18,395,700 11 Bad Debt 122,300 127,100 132,200 137,900 143,700 149,900 12 PILOT 1,039,600 1,080,700 1,124,000 1,171,800 1,221,800 1,274,000 13 Debt Service 0 0 0 0 0 0 14 Total Expenses 16,836,700 17,391,900 17,966,100 18,563,100 19,180,700 19,819,600 Transfers 15 Transfer to Shop Fund 33,000 0 0 0 0 0 16 Transfer to Operating Reserve 125,600 129,600 134,100 138,500 143,100 147,900 17 Cash Financing of Capital 6,270,000 6,880,000 8,710,000 14,490,000 14,800,000 13,850,000 18 Transfer to/from Capital Reserve 1,793,000 1,742,000 368,000 -4,900,000 -4,650,000 -3,110,000 19 Total Transfers 8,221,600 8,751,600 9,212,100 9,728,500 10,293,100 10,887,900 Fund Balance 20 Beginning Balance 105,500 103,800 109,600 100,100 105,900 108,000 21 Annual Operating Balance -1,700 5,800 -9,500 5,800 2,100 -800 22 Ending Fund Balance 103,800 109,600 100,100 105,900 108,000 107,200 Performance Metrics 23 Debt Service Coverage NA NA NA NA NA NA 24 0&M Reserve Balance (Days) Ej 90.00 90.00 90.00 j 90.00 _) 90.00 90.00 (a) Includes interest income on operating fund balance. (b) Mininum requirement is 90 days of following year's Operating Expenses. BLACK & VEATCH I Appendix 2: Wastewater Tables Page 214 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 10 - Wastewater Projected Fund Balances S S S S S 5 Operating Funds 1 O&M Reserve Balance (a) 3,990,600 4,120,200 4,254,300 4,392,800 4,535,900 4,683,800 2 Operating Fund Balance (b) 103,800 109,600 100,100 105,900 108,000 107,200 3 Total (e) 4,094,400 4,229,800 4,354,400 4,498,700 4,643,900 4,791,000 Capital Funds 4 Capital Fund Balance (c) 501,900 506,700 504,400 506,700 501,100 500,000 5 Capital Reserve Fund Balance (d) 19,995,000 21,737,000 22,105,000 17,205,000 12,555,000 9,445,000 6 Total (e) 20,496,900 22,243,700 22,609,400 17,711,700 13,056,100 9,945,000 7 Impact Fee Fund Balance (e) 4,437,800 3,935,100 4,269,200 4,591,000 4,900,200 5,644,100 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target mininum balance is $100,000 to account for any adjustments that may be needed to the O&M balance at the end of the year. (c) Target mininum balance is $500,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. Table S - 11- Wastewater 2022 Cost of Service OperatingOU6 Description am[� x pense L S S S Statement of Net Revenue Requirements (Cash Basis) Revenue Requirements 1 0&M Expenses 2 Bad Debt 3 PILOT 16,184,100 16,184,100 127,100 127,100 1,080,700 1,080,700 4 Debt Sevice Other Expenditures & Transfers: 0 0 Transfer to Shop Fund (Capital Outlay) 0 0 5 Transfer to Operating Reserve 129,600 129,600 6 Cash Funding of Capital Projects 6,880,000 6,880,000 7 Transfer to Capital Reserve 1,742,000 1,742,000 8 Subtotal 17,521,500 8,622,000 26,143,500 Less Revenue Requirements Met from Other Sources 9 Other Revenues and Adjustments 10 Interest Earned 11 Net Balance Available 12 Full Year Rate 13 Subtotal 14 Net Revenue Requirements to be Recovered by Rates Restatement of Net Cost of Service (Utility Basis) 15 O&M Expenses 16 Depreciation 17 Return 18 Net Cost of Service 44,200 44,200 (5,800) (5,800) 720,500 (5,800) 714,700 16,801,000 8,627,800 25,428,800 16,801,000 16,801,000 8,060,600 8,060,600 567,200 567,200 16,801,000 8,627,800 25,428,800 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 215 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 12 - Wastewater 2022 Allocation of Net Plant Investment $ $ $ $ $ $ $ $ $ $ $ s $ Net Plant Investment: 1 Sewer Collection 103,289,355 42,124,931 61,164,424 2 Sewer Connections 319:887 319,887 3 Water Meters 2,345,265 2,345,265 4 Owl Creek Lift Station and Force Main 14,103 14,103 5 Lift Stations 4,392,243 4,392,243 Sewer Treatment Plant- Noland 6 Sewage Pumping 229,919 229,919 7 Mechanical Bar Screens 172,282 51,685 120,597 8 Grit Removal 9 Primary Sedimentation 10 Disinfection 1,672,556 1,672,556 11 Aeration Equipment 1,120,704 560,352 560,352 12 Sludge Handling 400,690 220,380 180,311 13 Other Plant and Misc Equipment 837,703 443,170 193,907 200,626 14 General Treatment 12,725,018 6,731,924 2,945,516 3,047,578 Sewer Treatment Plant- West 15 Sewage Pumping 921,333 845,784 75,549 16 Mechanical Bar Screens 169,727 13,918 46,743 109,066 17 Grit Removal 1,380,570 113,207 1,267,363 18 Primary Sedimentation 6,927,776 568,078 1,907,909 4,451,789 19 Disinfection 653,801 600,189 53,612 20 Aeration Equipment 1,490,202 122,197 684,003 684,003 21 Sludge Handling 34,604,278 2,837,551 17,471,700 14,295,027 22 Other Plant and Mist Equipment 3,298,489 103,353 270,476 1,437,424 1,487,236 23 General Treatment 5,571,549 174,576 456,867 2,427,994 2,512,122 24 Sewer Land and Land Rights 6,358,594 1,878,712 135,236 2,470,280 152,831 945,827 875,138 570 25 General Plant 1,768,202 450,601 104,632 592,487 43,702 270,723 280,104 22,718 3,235 26 Total Net Plant Investment 190,664,246 48,846,487 11,041,339 64,227,191 0 4,707,988 0 29,064,153 0 30,071,312 0 2,367,983 337,795 Table S - 13 - Wastewater 2022 Allocation of Depreciation s s s s s s s s s s s s s Net Depreciation Expense: 1 Sewer Collection 2,823,622 1,151,570 1,672,052 2 Sewer Connections 22,463 22,463 3 Water Meters 128,485 128,485 4 Owl Creek Lift Station and Force Main 6,509 6,509 5 Lift Stations 105,383 105,383 Sewer Treatment Plant- Noland 6 Sewage Pumping 42,418 42,418 7 Mechanical Bar Screens 33,421 10,026 23,395 8 Grit Removal 9 Primary Sedimentation 30 Disinfection 281,379 281,379 11 Aeration Equipment 124,523 (1) 62,262 62,262 12 Sludge Handling 83,361 (1) 45,849 37,513 13 Other Plant and Mist Equipment 61,102 (1) 32,325 14,144 14,634 14 General Treatment 847,144 448,165 196,092 202,887 Sewer Treatment Plant- West 15 Sewage Pumping 117,218 107,606 9,612 16 Mechanical Bar Screens 55,071 4,516 15,167 35,388 17 Grit Removal 135,374 11,101 124,273 18 Primary Sedimentation 397,767 32,617 109,545 255,605 19 Disinfection 41,046 37,680 3,366 20 Aeration Equipment 140,345 1 11,508 64,418 64,418 21 Sludge Handling 2,080,224 170,578 1,050,305 859,341 22 Other Plant and Mist Equipment 316,959 9,931 25,991 138,125 142,912 23 General Treatment 45,160 1,415 3,703 19,680 20,362 24 Sewer Land and Land Rights 4,692 1,386 100 1,823 113 624 646 25 General Plant 166,945 42,544 9,879 55,940 4,126 25,560 26,446 2,145 305 26 Total Net Depreciation Expense 8,060,611 1,300,891 970,898 1,729,815 0 277,231 0 1,751,797 0 1,870,082 0 130,630 29,277 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 216 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 14 - Wastewater 2022 Allocation of O&M Expenses s s s s s s s s s s s s s 1 Sewer Mains Maintenance 2,438,014 994,305 1,443,708 2 Wastewater Treatment Plant 1,874,226 356,704 40,930 725,722 750,870 3 Wastewater Treatment Plant-Naland 5,416,220 1,149,101 2,097,222 2,169,997 4 Wastewater Treatment Plant -West 1,966,065 255,901 161,217 761,283 787,664 5 Lift Stations 961,584 961,584 6 Meter Operations (a) 1,653,047 1,653,047 7 Water&Sewer Connections 198,731 198,731 8 Operations and Administration 1,396102 188,216 169,530 138,929 19,453 344,912 356,864 159,074 19,124 9 All Other O&M Co. 1,617:511 218,065 196,416 160,962 22,538 399,612 413,460 184,301 22,157 10 Subtotal 17,521,500 2,362,170 2,127,652 1,743,599 0 244,138 0 4,328,751 0 4,478,755 1,996,422 0 240,012 Less: Other Income Sources 11 Sewer Connection Fees 47,%0 47,900 12 Other Income Sources 672,600 49,235 87,491 71,698 10,039 178,002 184,170 82,095 9,870 13 Subtotal 720,500 49,235 87,491 71,698 0 10,039 0 178,002 0 184,170 82,095 0 57,770 14 Net O&M EV.nses 16,801,000 2,312,936 2,040,361 1,671,901 0 234,099 0 4,150,749 0 4,294,583 1,914,327 0 182,243 Table S - 15 - Wastewater 2022 Units of Service 1,000gal. 1,000gal. 1,000gal. Pounds Pounds Bills Equiv. Meters (2) + (3) Inside City 1 Residential 1,741,203 1,569,234 3,310,437 5,627,580 4,793,035 421,883 34,346 2 Non -Residential 698,651 251,356 950,007 2,179,172 1,765,439 34,296 5,157 3 Industrial 396,716 88,856 485,572 1,226,170 980,007 252 249 4 Subtotal 2,836,570 1,909,446 4,746,016 9,032,922 7,538,481 456,431 39,752 Outside City Farmington 5 Residential 75,950 76,937 152,887 247,241 212,609 21,431 1,603 6 Non -Residential 12,743 7,473 20,216 40,350 33,405 1,656 157 7 Industrial 8 Subtotal 88,694 84,409 173,103 287,591 246,014 23,087 Greenland 9 Residential 10,349 17,400 27,749 35,133 31,856 5,388 435 10 Non -Residential 2,153 1,824 3,976 6,933 5,877 480 22 11 Industrial 12 Subtotal 12,502 19,223 31,725 42,066 37,733 5,868 Washington County/ Growth Area 13 Residential 4,304 1,898 6,202 13,498 11,021 336 74 14 Non -Residential 67 67 14 28 24 15 Industrial 16 Subtotal 4,304 1,965 6,269 13,512 11,049 360 Johnson 17 Residential 6,479 6,720 13,199 21,124 18,202 1,884 151 18 Non -Residential 28 141 169 114 126 48 18 19 Industrial 20 Subtotal 6,507 6,860 13,367 21,238 18,328 1,932 21 Total Retail 2,942,069 2,015,044 4,957,113 9,376,091 7,833,277 485,746 39,752 Wholesale 22 Elkins 81,017 18,069 99,086 250,391 200,104 24 23 23 West Fork 45,625 10,171 55,796 141,008 112,688 12 23 24 Subtotal 126,642 28,241 154,883 391,399 312,792 36 45 25 Subtotal (Inside City) 2,836,570 1,909,446 4,746,016 9,032,922 7,538,481 456,431 39,752 26 Subtotal (Outside City) 112,007 112,458 224,465 364,407 313,124 31,247 - 27 Subtotal (Wholesale) 126,642 28,241 154,883 391,399 312,792 36 45 28 Surcharge Customers 1,282,742 910,900 29 Total System 3,075,218 2,050,145 5,125,363 11,071,470 9,075,297 487,714 42,258 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 217 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 16 - Wastewater 2022 Unit Cost of Service $ 1,000 ga I. 1,000 ga 1. 1,000 gal. "Wo ga 1. 1,000 gal. Pounds Pounds Pounds Pounds Bills Eq.w. Meters Bills Units of Service 1 Iruid, City 4,746,159 4,746,159 4,746,359 4,746,359 9,032,952 9,032,952 7,538,541 7538,541 456,431 39,752 456,431 2 Outside City -w/o Farmington 206,667 206,667 51,784 51,784 469,273 469,275 380,751 380,751 8,196 746 3 Surcharge 173,110 173,110 173,110 287,593 246,016 23,087 1,761 4 Total System 5,125,935 4,952,825 4,971,052 4,797,943 173,110 9,789,820 9,502,227 8,165,308 7,919,292 48],]14 42,258 456,431 Costs of Servke Net Operating Expense 5 Total -$ 16,801,000 2,312,936 2,040,161 1,6]1,901 234,099 4,1513,749 4,294,584 1,914,327 182,243 6 Unit Cost - $/unit 0.45 0.41 0.34 1.35 0.38 0.49 3.93 DAD ] Depreciation Expense: Total -$ 8,060,608 1,300,881 970,898 1,729,815 2]],231 1,751,797 1,870,02 $ 130,630 29,2]] 8 Unit Cost -$/unit 0.25 0.20 0.35 1.60 0.16 0.21 $ 3.0913 0.06 Net Plain Investment: 9 Total -$ 190,664,246 48,846,487 11,041,339 64,227,191 4,]0],988 29,064,153 30,071,312 2,367,983 337,795 10 Unit Cost - $/unit 9.53 2.23 12.92 27.20 2.69 3.41 56.04 0.74 Return on Investment 11 nside City, Unit Return - $/unit (0.02) (0.00) (0.02) (0.00) (0.01) (0.30) (0.00) 12 Outside City- Except Farmington - Unit Return - $/Unit 0.67 0.16 0.% 0.19 0.24 3.92 13 Outside City - Farmington - Unit Return -$/Unit 0.52 0.71 $1.4958 3.08 Total Return 14 Inside City -$ (310,073) (79,559) (18,612) (107,870) (48,902) (50,617) (3,918) (594) 15 Outsid, City- Except Farmington-$ 399,157 137,857 32,251 46,834 88,525 90,766 2,925 16 Outsid. City - Farmington -$ 478,108 90,729 123,014 258,939 5,426 17 Total Return -$ 567,192 149,026 13,638 61,978 258,939 39,623 40,148 4,432 (594) Total Unit Co of Service 18 Inside City - $/unit 0.69 D.60 C.66 0.54 0.69 3.93 2.99 0.46 19 Outside City(E., Farmington-$/unit 1.37 D.76 1.59 0.74 D.. 3.93 7.01 20 Outside City - Farmington - $/unit 1.23 1.39 $ 4.4496 3.93 6.1] Total Cost of Senn,, 21 Inside City - Retail -$ 21,513,312 3,266,513 2,866,804 3,139,950 4,900,857 5,217,759 1,791,539 118,964 210,926 22 Inside City -Surcharge-$ 1,326,430 695,956 630,474 23 D-n,, City-Excep[Farmington-$ 1,263,056 113,555 157,193 82,2]0 345,356 356,581 32,170 5,230 24 Outside City - Farmington- $ 1,326,002 212,1]2 241,4]4 770,270 90,618 30,868 25 Tatal Cost of Servke -$ 25,428,800 3,762,841 3,024,697 3g63,694 0 770,270 U 5,942,369 0 6,204,815 1,914,327 135,062 210,926 Table S - 17 - Wastewater 2022 Cost of Service by Customer Class (1) (2) (3) (4) Inside City 1 Residential 2 Non -Residential 3 Industrial 4 Subtotal 14,792,813 16,719,785 4,426,345 3,926,165 2,294,154 1,890,075 21,513,312 22,536,025 Outside City 5 Residential 1,496,787 1,242,033 6 Non -Residential 1791997 160,411 7 Industrial 8 Subtotal 1,676,784 1,402,445 11.5% 12.7% 21.4% -4.5% 20.5 % 12.2% 100.0% 19.6% 9 Total Retail 23,190,096 23,938,469 -3.1% 10 Wholesale 912,277 655,689 39.1% 11 Surcharge 1,326,430 834,607 58.9% 12 Total 25,428,803 25,428,765 0.0% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 218 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 18 - Wastewater Proposed 2022 Charges Existing Wastewater Rates Effective January 1, 2022 Proposed Wastewater Rates Effective August 1, 2022 Inches $/month $/month $/month Inches $/month $/month $/month 5/8 18.28 18.28 16.74 5/8 18.28 18.28 25.10 3/4 18.28 18.28 16.74 3/4 18.28 18.28 25.10 1 23.74 33.92 31.28 1 23.74 33.92 52.62 11/2 38.77 60.37 55.50 11/2 38.77 66.73 109.78 2 55.43 79.73 73.45 2 55.43 93.11 154.24 3 128.73 184.24 169.29 3 128.73 196.10 327.83 4 212.13 303.44 278.93 4 212.13 303.44 482.37 6 420.39 601.46 553.70 6 420.39 601.46 897.30 8 628.73 899.76 826.81 8 628.73 899.76 998.92 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential First 2,000 Gallons > 2,000 Gallons 4.35 5.80 All Usage 8.18 7.52 Non -Residential All Usage 4.40 8.18 7.52 Major Industrial All Usage 4.71 8.18 7.52 Wholesale 85% of metered water usage 5.19 Above 85% of metered water 2.71 Surcharge BOD - $/lb for strength in excess of 300 p 0.4352 TSS - $/Ib for strength in excess of 300 pp 0.3056 BLACK & VEATCH I Appendix 2: Wastewater Tables 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential First 2,000 Gallon. 3.39 > 2,000 Gallons 4.52 All Usage 8.55 8.27 Non -Residential All Usage 5.10 8.55 8.27 Major Industrial All Usage 5.71 8.55 8.27 Wholesale 85% of metered water usage 7.20 Above 85% of metered water 7.20 Surcharge BOD - $/lb for strength in excess of 30, 0.5426 TSS - $/lb for strength in excess of 300 0.6921 11-10 Page 219 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 19 - Wastewater 2022 Cost of Service Under Proposed Rates s 5 5 5 Inside City 1 Residential 14,792,800 16,719,800 -11.5% 14,790,200 100.0% -11.5% -1,929,600 2 Non -Residential 4,426,300 3,926,200 12.7% 4,424,900 100.0% 12.7% 498,700 3 Industrial 2,294,200 1,890,100 21.4% 2,291,500 99.9% 21.2% 401,400 4 Subtotal 21,513,300 22,536,100 -4.5% 21,506,600 100.0% -4.6% -1,029,500 Outside City 5 Residential 1,496,800 1,242,000 20.5% 1,489,900 99.5% 20.0% 247,900 6 Non -Residential 180,000 160,400 12.2% 193,500 107.5% 20.6% 33,100 7 Industrial 0.0% 0.0% 8 Subtotal 1,676,800 1,402,400 19.6% 1,683,400 100.4% 20.0% 281,000 Wholesale 9 Elkins 583,600 419,500 39.1% 583,300 99.9% 39.0% 163,800 10 West Fork 328,700 236,200 39.2% 328,500 99.9% 39.1% 92,300 11 Subtotal 912,300 655,700 39.1% 911,800 99.9% 39.1% 256,100 12 Surcharge 1,326,400 834,600 58.9% 1,326,400 100.0% 58.9% 491,800 13 Total 25,428,800 25,428,800 0.0% 25,428,200 100.0% 0.0% -600 Table S - 20 - Wastewater 2022 Bill Impact Line No. Meter Residential 1 Size Inches 3/4 Monthly Usage 1,000 ga 1. 0.5 Existing Rates $ 22.10 Inside City Proposed Rates $ 19.98 Increase Decrease $ -2.13 $ 26.46 Outside Proposed Rates $ 22.56 City increase increase Decrease $ -3.91 Decrease -14.8% 2 3/4 2 26.45 25.06 -1.39 34.64 35.38 0.74 2.1% 3 3/4 4 38.05 31.84 -6.21 51.00 52.48 1.48 2.9% 4 3/4 8 61.25 45.40 -15.85 83.72 86.68 2.96 3.5% 5 3/4 10 72.85 52.18 -20.67 100.08 103.78 3.70 3.7% 6 3/4 15 101.85 69.13 -32.72 140.98 146.53 5.55 3.9% Non -Residential 7 3/4 10 61.75 69.28 7.53 100.08 103.78 3.70 3.7% 8 3/4 20 105.75 120.28 14.53 181.88 189.28 7.40 4.1% 9 1 50 243.05 278.74 35.69 442.92 461.42 18.50 4.2% 10 1 100 463.05 533.74 70.69 851.92 888.92 37.00 4.3% 11 1 1/2 50 257.64 293.77 36.13 469.37 494.23 24.86 5.3% 12 1 1/2 100 477.64 548.77 71.13 878.37 921.73 43.36 4.9% 13 2 100 493.82 565.43 71.61 897.73 948.11 50.38 5.6% 14 2 500 2,253.82 2,605.43 351.61 4,169.73 4,368.11 198.38 4.8% Industrial 15 2 100 493.52 626.43 132.91 897.73 948.11 50.38 5.6% 16 2 1,000 4,732.52 5,765.43 1,032.91 8,259.73 8,643.11 383.38 4.6% 17 4 500 2,441.89 3,067.13 625.24 4,393.44 4,578.44 185.00 4.2% 18 4 1,500 7,151.89 8,777.13 1,625.24 12,573.44 13,128.44 555.00 4.4% 19 6 2,500 11,948.78 14,695.39 2,746.61 21,051.46 21,976.46 925.00 4.4% 20 6 5,000 23,723.78 28,970.39 5,246.61 41,501.46 43,351.46 1,850.00 4.5% 21 6 10,000 47,273.78 57,520.39 10,246.61 82,401.46 86,101.46 3,700.00 4.5% BLACK & VEATCH I Appendix 2: Wastewater Tables 11 11 Page 220 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 12.0 Appendix 3: Combined Tables Table C - 1- Combined Projected Fund Balances $ $ $ s s s s Operating Funds 1 O&M Reserve Balance (a) 8,052,000 8,314,600 8,586,100 8,866,700 9,156,600 9,456,300 9,766,200 2 Operating Fund Balance (b) 209,900 210,500 200,100 208,800 212,800 209,800 209,700 3 Subtotal Operating Funds Balance (e) 8,261,900 8,525,100 8,786,200 9,075,500 9,369,400 9,666,100 9,975,900 Capital Funds 4 Capital Fund Balance (c) 1,008,700 1,008,400 1,006,100 1,010,300 1,009,800 1,003,200 1,003,600 5 Capital Reserve Fund Balance (d) 32,910,000 30,176,000 28,563,500 22,813,500 17,653,500 13,733,500 9,033,500 6 Subtotal Capital Funds Balance (e) 33,918,700 31,184,400 29,569,600 23,823,800 18,663,300 14,736,700 10,037,100 7 Impact Fee Fund Balance (e) 4,460,597 4,516,397 4,378,897 5,592,597 6,791,197 8,511,397 10,231,597 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target minimum combined balance is $200,000 to account for any adjustments that may be needed to the O&M balance at the end of the year. (c) Target minimum combined balance is $1,000,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-1 Page 221 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table C - 2 - Combined Operating Cash Flow Revenues 1 Revenues Under Existing Rates 45,648,500 47,229,500 47,826,000 48,433,700 49,053,000 49,684,500 50,328,300 Revenue Increases 2 0.0 % Increase Effective January 1, 2022 0 0 0 0 0 0 3 3.0 % Increase Effective January 1, 2023 0 1,315,200 1,453,000 1,471,600 1,490,500 1,509,900 4 3.0 % Increase Effective January 1, 2024 0 0 1,371,800 1,515,700 1,535,300 1,555,200 5 3.0 % Increase Effective January 1, 2025 0 0 0 1,431,100 1,581,300 1,601,800 6 3.0 % Increase Effective January 1, 2026 0 0 0 0 1,493,100 1,649,800 7 Total Revenue from Rates 45,648,500 47,229,500 49,141,200 51,258,500 53,471,400 55,784,700 58,202,800 8 Other Revenues (a) 1,127,800 1,362,000 1,369,800 1,378,500 1,387,500 1,397,100 1,406,700 9 Subtotal Revenues 46,776,300 48,591,500 50,511,000 52,637,000 54,858,900 57,181,800 59,609,500 10 Expenses Operating Expenses 31,624,400 32,655,200 33,720,400 34,821,100 35,959,200 37,135,100 38,350,700 11 Bad Debt 228,200 236,100 245,700 256,300 267,300 278,900 291,000 12 PILOT 1,940,000 2,007,200 2,088,500 2,178,500 2,272,600 2,370,900 2,473,600 13 SDWF-Reimbursement to ADPH 230,000 233,800 237,800 241,800 245,900 250,200 254,400 14 Debt Service 0 0 0 0 0 0 0 15 Total Expenses 34,022,600 35,132,300 36,292,400 37,497,700 38,745,000 40,035,100 41,369,700 16 Transfers Transfer to Shop Fund 66,000 0 0 0 0 0 0 17 Transfer to Operating Reserve 254,200 262,600 271,500 280,600 289,900 299,700 309,900 18 Cash Financing of Capital 11,730,000 15,930,000 15,570,000 20,600,000 20,980,000 20,770,000 22,630,000 19 Transferto/from Capital Reserve 700,000 -2,734,000 -1,612,500 -5,750,000 -5,160,000 -3,920,000 -4,700,000 20 21 Total Transfers Fund Balance Beginning Balance 12,750,200 206,400 13,458,600 209,900 14,229,000 210,500 15,130,600 200,100 16,109,900 208,800 17,149,700 212,800 18,239,900 209,800 22 Annual Operating Balance 3,500 600 -10,400 8,700 4,000 -3,000 -100 23 Ending Fund Balance 209,900 210,500 200,100 208,800 212,800 209,800 209,700 Performance Metrics 24 Debt Service Coverage NA NA NA NA NA NA NA 25 0&M Reserve Balance (Days)(b) 0 90.00 90.00 90.00 O 90.00 O 90.00 90.00 90.00 (a) Includes interest income on operating fund balance. (b) Mininum requirement is 90 days of following year's Operating Expenses. BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-2 Page 222 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table C - 3 - Combined 2022 Bill Impact Line No. Meter Residential 1 Size Inches 3/4 Monthly Usage 1,000gal. 0.5 Existing Rates $ 32.01 Inside Proposed Rates $ 28.22 City Increase / Decrease $ -3.80 Increase Decrease -11.9% Existing Rates $ 37.82 Outside Pro poseffimmillillIPPIPPM Rates $ 32.33 City Decrease $ -5.49 -14.5% 2 3/4 2 39.87 38.25 -1.62 -4.1% 50.04 51.86 1.82 3.6% 3 3/4 4 60.77 53.77 -7.00 -11.5% 77.10 80.78 3.68 4.8% 4 3/4 8 102.57 84.81 -17.76 -17.3% 131.22 138.62 7.40 5.6% 5 3/4 10 123.47 100.33 -23.14 -18.7% 158.28 167.54 9.26 5.9% 6 3/4 15 175.72 139.13 -36.59 -20.8% 225.93 239.84 13.91 6.2% Non -Residential 7 3/4 10 106.05 115.17 9.12 8.6% 151.20 161.82 10.62 7.0% 8 3/4 20 187.95 205.47 17.52 9.3% 276.80 297.82 21.02 7.6% 9 1 50 441.42 484.38 42.96 9.7% 672.13 726.18 54.05 8.0% 10 1.5 100 872.11 957.70 85.59 9.8% 1,334.15 1,450.95 116.80 8.8% 11 2 500 4,091.34 4,593.63 502.29 12.3% 6,289.61 6,926.63 637.02 10.1% Industrial 12 2 100 812.04 963.63 151.59 18.7% 1,260.25 1,330.63 70.38 5.6% 13 2 1,000 7,715.04 8,928.63 1,213.59 15.7% 11,682.25 12,166.63 484.38 4.1% 14 4 1,500 11,678.78 13,576.63 1,897.85 16.3%1 17,760.33 18,466.37 706.04 4.0% 15 6 5,000 1 38,697.56 44,849.38 6,151.82 15.9%1 58,675.24 61,007.28 2,332.04 4.0% 16 6 10,000 1 77,047.56 89,099.38 12,051.82 15.6%1 116,575.24 121,207.28 4,632.04 4.0% BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-3 Page 223 of 425 EXH I BIT A 51.136 Monthly Water Rates Effective as of the first billing statements issued after December 31, 2022, the following monthly rates shall be fixed as rates to be charged for water furnished by the waterworks system of the city, which rates the City Council finds and declares to be reasonable and necessary minimum rates to be charged. All non -emergency water uses shall be billed to the user, to include but not limited to water used for: use within structures; business; manufacturing; irrigation; retail by another water utility; city uses; educational purposes; medical purposes; water system routine non -emergency uses; wastewater system routine non -emergency uses; non-profit uses; fire department non -emergency uses to include training and equipment calibration; construction of new water mains; street cleaning; and wet down of construction sites and materials. Emergency water use that does not pass through a water system meter shall not be billed, including firefighting, water leaks, water leak repair, and emergency water line flushing. The volumes used for these emergency purposes should be estimated and submitted monthly to the Business Office Manager and the Water/Sewer Operations Manager. (A) Monthly Water Rates. (1) The water usage of each customer shall be determined each month by meter measurement and the amount per 1,000 gallons to be paid for water usage by each customer shall be computed on the basis of the following schedule of rates. Table A-1 Monthly Water Rates Prior to January 1, 2023 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.51 $4.04 Next 13,000 $4.65 $5.35 Over 15,000 $6.59 $7.54 Non -Residential First 300,000 $3.79 $4.38 Over 300,000 $3.39 $3.90 Major Industrial All Usage $2.96 $3.40 Irrigation First 300,000 $5.04 $5.80 Over 300,000 $4.53 $5.22 Wholesale Reduced Peak Demand $2.87 $2.87 Peak Demand $3.20 $3.20 Table A-2 Monthly Water Rates After December 31, 2022 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.30 $4.47 Next 13,000 $4.37 $5.91 Over 15,000 $6.20 $8.38 Non -Residential First 300,000 $3.93 $5.05 Over 300,000 $3.93 $5.05 (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 1 of 11 Page 224 of 425 EXHIBIT A Major Industrial All Usage $3.14 $3.49 Irrigation First 300,000 $4.29 $5.43 Over 300,000 $4.29 $5.43 Wholesale Reduced Peak Demand $3.16 $3.16 Peak Demand $3.16 $3.16 Table A-3 Monthly Water Rates After December 31, 2023 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.40 $4.60 Next 13,000 $4.50 $6.09 Over 15,000 $6.39 $8.63 Non -Residential First 300,000 $4.05 $5.20 Over 300,000 $4.05 $5.20 Major Industrial All Usage $3.23 $3.59 Irrigation First 300,000 $4.42 $5.59 Over 300,000 $4.42 $5.59 Wholesale Reduced Peak Demand $3.25 $3.25 Peak Demand $3.25 $3.25 Table A-4 Monthly Water Rates After December 31, 2024 Cost per 1,000 gallons Class Usage Rate (In Gallons) Inside City Outside City Residential First 2,000 $3.50 $4.74 Next 13,000 $4.64 $6.27 Over 15,000 $6.58 $8.89 Non -Residential First 300,000 $4.17 $5.36 Over 300,000 $4.17 $5.36 Major Industrial All Usage $3.33 $3.70 Irrigation First 300,000 $4.55 $5.76 Over 300,000 $4.55 $5.76 Wholesale Reduced Peak Demand $3.35 $3.35 Peak Demand $3.35 $3.35 (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 2 of 11 Page 225 of 425 EXH I BIT A (2) Beginning January 1, 2026, all monthly water rates shall be increased by 3% per year. (3) All bills under such schedules shall be computed by adding the applicable meter service charge prescribed by subsection (B) to the amount determined to be due for water usage under this schedule. Applicable sales tax and franchise fees shall be added to the bill so computed. (4) When a common facility/building is served by multiple water meters and the water usage is for the same purpose, customers may petition the Water & Wastewater Director and/or the Finance & Internal Services Director to have the water consumption aggregated and have the tiered rates apply to the aggregated quantity. (5) Water used for flushing and sampling of newly constructed water lines, Fire Department training and equipment calibration, and other similar uses requiring a large volume and/or high velocity of water movement shall employ a fire hydrant meter of the appropriate size for the use. If a fire hydrant meter cannot be used due to high flow or volume requirements, then the volume of water used shall be measured by using a pitot gauge to determine the gallons per minute and by timing the flow of water to be able to calculate total volume. In the cases of fire department training and equipment calibration, sewer line washing, street sweeping, and other uses where the equipment employed has a built-in water meter, these built in water meters may be used. All such meters other than those on fire trucks must be evaluated by the Meter Superintendent. These water uses shall be billed at the same rates as non-residential customers. (6) Monthly wholesale treated water rates outside city limits are based on Cost of Service Methodology. (B) Monthly Water Service Charge. (1) In addition to the above, each customer shall pay a monthly water service charge in accordance with the following schedule: Table B-1 Monthly Water Service Charge Prior to January 1, 2023 Meter Size Inside City Outside City Wholesale % x % inch $6.59 $7.54 $7.54 1 inch $9.14 $10.52 $10.52 1 % inch $15.93 $18.31 $18.31 2 inch $23.20 $26.66 $28.56 3 inch $54.05 $62.18 $64.38 4 inch $89.50 $102.93 $112.25 6 inch $178.99 $205.82 $213.02 8 inch 1 $268.41 1 $308.67 1 $319.47 Table B-2 Monthly Water Service Charge After December 31, 2022 Inside Outside Meter Size City City Wholesale % x % inch $6.59 $7.54 $7.54 1 inch $9.14 $12.26 $12.26 (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 3 of 11 Page 226 of 425 EXH I BIT A 1 Y2 inch $15.93 $24.22 $24.22 2 inch $23.20 $33.52 $33.52 3 inch $54.05 $69.84 $69.84 4 inch $89.50 $102.93 $102.93 6 inch $178.99 $205.82 $205.82 8 inch $268.41 $308.67 $308.67 Table B-3 Monthly Water Service Charge After December 31, 2023 Meter Size Inside City Outside City Wholesale % x % inch $6.79 $7.77 $7.77 1 inch $9.41 $12.63 $12.63 1 Y2 inch $16.41 $24.95 $24.95 2 inch $23.90 $34.53 $34.53 3 inch $55.67 $71.94 $71.94 4 inch $92.19 $106.02 $106.02 6 inch $184.36 $211.99 $211.99 8 inch $276.46 $317.93 $317.93 Table B-4 Monthly Water Service Charge After December 31, 2024 Meter Size Inside City Outside City Wholesale % x % inch $6.99 $8.00 $8.00 1 inch $9.70 $13.01 $13.01 1 % inch $16.90 $25.69 $25.69 2 inch $24.61 $35.56 $35.56 3 inch $57.34 $74.09 $74.09 4 inch $94.95 $109.20 $109.20 6 inch $189.89 $218.35 $218.35 8 inch $284.76 $327.47 $327.47 (2) Beginning January 1, 2026, all monthly water service charges shall be increased by 3% per year. (3) The monthly treated water rates and the monthly meter service charge rates prescribed by subsections (A) and (B) of this section shall commence as of the first billing statements issued after December 31, 2022. (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 4 of 11 Page 227 of 425 EXH I BIT A (4) The State of Arkansas mandated Safe Drinking Water Act fee shall be added to the monthly water utility bill. (C) Monthly Standby Fire Protection Service Charge. (1) Charges for unmetered service connections for standby fire protection and fire hydrants shall be based on the incoming line size or the backflow preventer size, whichever is smaller, as set forth in the following table: Monthly Standby Fire Protection Service Charge Line Size or Backflow Preventer Size Inside City Outside City 1 inch $9.75 $11.68 2 inch 10.17 12.10 2.5 inch 20.33 23.37 3 inch 30.48 35.06 4 inch 60.97 70.11 6 inch 169.34 194.74 8 inch 355.65 409.00 10 inch 609.68 701.11 (2) The Utilities Department shall review the monthly standby fire protection service charges every two (2) years and shall make recommendations to the City Council following such review. Fire protection lines shall not be connected to the water system downstream from a meter. (Code 1965, §21-25; Ord. No. 1165, 4-18-58; Ord. No. 2144, 9-2-75; Ord. No. 2594, 2-5-80; Ord. No. 3197, 7-1-86; Ord. No. 3409, 2-21-89; Ord. No. 3431, 6-6-89; Ord. No. 3491, 7-17-90; Ord. No. 3513, 9-18-90; Ord. No. 3519, 11- 20-90; Ord. No. 4059, §1, 10-7-97; Ord. No. 4223, 2-15-00; Code 1991, §51.136; Ord. No. 4530 12-02-02; Ord. No. 4540, 02-03-04; Ord. No. 5123, 4-1-08; Ord. No. 6169, §1, 4-2-2019) (Supp. No. 25) Created: 2022-05-17 11:20:0S [EST] Page 5 of 11 Page 228 of 425 EXHIBIT B 51.137 Monthly Sewer Rates (A) Monthly Sewer Rates. (1) All monthly sewer charges shall be calculated from the customer's monthly water usage. The following monthly rates are hereby fixed as rates to be charged for sewer services: Table D-1 Monthly Sewer Rates Per 1,000 Gallons Before January 1, 2023 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $4.35 Greater than $5.80 2,000 gallons Non -Residential All Usage $4.40 Major Industrial All Usage $4.71 Farmington All Usage $7.52 Outside city All Usage $8.18 Elkins 85% of metered $5.19 water usage Usage above 85% of $2.71 metered water usage Table D-2 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2022 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.39 Greater than $4.52 2,000 gallons Non -Residential All Usage $5.10 Major Industrial All Usage $5.71 Farmington All Usage $8.27 Outside city All Usage $8.55 Elkins 85% of metered $7.20 water usage Usage above 85% of $7.20 metered water usage (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 6 of 11 Page 229 of 425 EXHIBIT B Table D-3 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2023 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.49 Greater than $4.66 2,000 gallons Non -Residential All Usage $5.25 Major Industrial All Usage $5.88 Farmington All Usage $8.52 Outside city All Usage $8.81 Elkins 85% of metered $7.42 water usage Usage above 85% of $7.42 metered water usage Table D-4 Monthly Sewer Rates Per 1,000 Gallons After December 31, 2024 Class Usage Rate Cost per (In Gallons) 1,000 gallons Residential First 2,000 gallons $3.60 Greater than $4.80 2,000 gallons Non -Residential All Usage $5.41 Major Industrial All Usage $6.06 Farmington All Usage $8.77 Outside city All Usage $9.07 Elkins 85% of metered $7.64 water usage Usage above 85% of $7.64 metered water usage (2) Beginning January 1, 2026, all monthly sewer quantity charge- usage rates per 1,000 gallons shall be increased by 3% per year. (3) Sewer related fees levied by the Cities of Farmington or Greenland shall be added to the wastewater utility bill at the request of Farmington or Greenland. These fees may be calculated on a per -thousand volumetric usage or a per month basis. (B) Monthly Sewer Service Charge. (Supp. No. 25) Created: 2022-05-17 11:20:0S [EST] Page 7 of 11 Page 230 of 425 EXHIBIT B (1) In addition to the above, each customer shall pay a monthly sewer service charge in accordance with the following schedule: Table E-1 Monthly Sewer Service Charge Prior to January 1, 2023 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.28 $18.28 $16.74 1 inch $23.74 $33.92 $31.28 1Y2 inch $38.77 $60.37 $55.50 2 inch $55.43 $79.73 $73.45 3 inch $128.73 $184.24 $169.29 4 inch $212.13 $303.44 $278.93 6 inch $420.39 $601.46 $553.70 8 inch $628.73 $899.76 $826.81 Table E-2 Monthly Sewer Service Charge After December 31, 2022 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.28 $18.28 $25.10 1 inch $23.74 $33.92 $52.62 1Y2 inch $38.77 $66.73 $109.78 2 inch $55.43 $93.11 $154.24 3 inch $128.73 $196.10 $327.83 4 inch $212.13 $303.44 $482.37 6 inch $420.39 $601.46 $897.30 8 inch $628.73 $899.76 $998.92 Table E-3 Monthly Sewer Service Charge After December 31, 2023 Meter Size Inside City Outside Cityt Farmingtont % x % inch $18.83 $18.83 $25.85 1 inch $24.45 $34.94 $54.20 1% inch $39.93 $68.73 $113.07 2 inch $57.09 $95.90 $158.87 3 inch $132.59 $201.98 $337.66 4 inch $218.49 $312.54 $496.84 6 inch $433.00 $619.50 $924.22 8 inch $647.59 $926.75 $1,028.89 (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 8 of 11 Page 231 of 425 EXHIBIT B Table E-4 Monthly Sewer Service Charge After December 31, 2024 Meter Size Inside City Outside Cityt Farmingtont % x % inch $19.39 $19.39 $26.63 1 inch $25.19 $35.99 $55.82 1% inch $41.13 $70.79 $116.47 2 inch $58.81 $98.78 $163.63 3 inch $136.57 $208.04 $347.79 4 inch $225.05 $321.92 $511.75 6 inch 1 $445.99 1 $638.09 1 $951.95 8 inch 1 $667.02 1 $954.56 1 $1,059.75 tCost of Service Methodology required by contract. (2) Beginning January 1, 2026, all monthly sewer service charges shall be increased by 3% per year. (C) Determination of Sewer Quantity Charge for Residential Customers. (1) In the case of residential customers residing in a single family home, duplex, triplex, and/or fourplex, the average monthly water consumption for the preceding months of December, January, and February shall be computed separately for each customer, and a uniform monthly charge for each customer shall be determined by applying the schedule of rates set out in subsection (A) of this section to such average monthly water consumption. In the case of a residential user for whom a uniform monthly charge has been established and who moves to a new location the same uniform monthly charge shall apply at the new location. In the case of new residential customers, sewer averages shall be established based on the number of individuals residing within the dwelling unit, at a rate of 2,100 gallons per customer per month. This methodology of sewer averaging shall not apply to multi -family structures containing five (5) or more units in a contiguous building. (2) In the case of sewer customers who do not have a water meter provided by a public water utility, the sewer usage volume billed shall be the average volume of all users in the sewer system in like dwellings from the most recent system -wide sewer average calculation. (D) Determination of Charge for Non-residential and Major Industrial Customers. In the case of non-residential and/or major industrial customers, the monthly sewer charge shall be determined by applying the schedule of rates prescribed in subsection (A) of this section to the monthly water usage of such customers. In the event that a non-residential or major industrial customer discharging waste into the city's sanitary sewer system produces evidence to the Water and Wastewater Director demonstrating that a substantial portion of the total amount of water from all sources used for all purposes does not reach the sanitary sewer which is in excess of the factors used in establishing the rates in subsection (A) of this section, an estimated percentage of total water consumption to be used in computing charges may be established by the Water and Wastewater Director. The factors used in establishing said rates are on file in the office of the Water and Wastewater Director and are incorporated herein by reference thereto. Any rate so adjusted by the Water and Wastewater Director shall be effective for a twelve (12) month period beginning with the billing for the month when rates adjudged hereby go into effect. (E) Extra Strength Surcharge. Created: 2022-05-17 11:20:05 [EST] (Supp. No. 25) Page 9 of 11 Page 232 of 425 EXHIBIT B (1) For all significant industrial users as defined in §51.074, whose wastewater discharge is greater than 300 mg/I of BOD s and/or TSS, the city shall levy an Extra Strength Surcharge for each parameter in accordance with the following unit charges: Table F3 Extra Strength Surcharges After 12/31/2022 Extra Strength BOD s $0.5426 per pound Extra Strength TSS $0.6921 per pound (2) Starting after December 31, 2023, Extra Strength Surcharges shall be increased by 3% per year. (3) Extra Strength Surcharges shall be billed monthly and shall be computed on the basis of water meter reading (wastewater discharge volume). (4) All sampling and analyses of the wastewater characteristics shall be performed in accordance with U.S. Environmental Protection Agency 40 Code of Federal Regulations Part 136 approved methods. (5) The volume of flow used in computing surcharge shall be based upon metered water consumption as shown in the records of meter readings maintained by the city's business office. In the event that a user discharging waste into the city sanitary sewer system produces evidence to the city demonstrating that a portion of the total amount of water used for all purposes is not discharged into the sanitary sewer, a separate meter or meters or other approved flow measuring device may be installed at the user's expense, upon its request, to measure only that portion of the total flow being discharged into the city sewer system. If a surcharge is assessed by the city, it shall be shown separately on the monthly billing. (6) Any person discharging industrial waste into the sanitary sewers of the city who procures any part or all of the user's water supply from sources other than the city, all or part of which is discharged into the sanitary sewer, shall install and maintain at the user's expense water meters of the type approved by the city for the purpose of determining the proper volume of flow to be used in computing sewer service charges. Such meter will be read monthly and tested for accuracy when deemed necessary by the city. Where it can be shown that a portion of the water measured by the aforesaid meter or meters does not enter the sanitary sewer system of the city, a separate meter or meters or other approved flow measuring device may be installed at the user's expense, upon its request, to measure only that portion of the total flow being discharged into the city sewer system. If a surcharge is assessed by the city, it shall be shown separately on the monthly billing. (7) Computation of extra strength surcharges shall be based on the following formula: (a) Extra strength surcharge: S I = V x 8.34 x [BOD Unit Charge (BOD - 300) + SS Unit Charge (TSS - 300)] (b) Where: S = Surcharge in dollars V = Sewer volume in million gallons 8.34 = Pounds per gallon of water BOD Unit Charge = Unit charge for BOD in dollars per pound (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 10 of 11 Page 233 of 425 EXHIBIT B BOD = BOD strength in parts per million 300 = Allowed BOD strength in parts per million TSS Unit Charge = Unit charge for suspended solids in dollars per pound TSS = Suspended solids strength in parts per million 300 = Allowed TSS Strength in parts per million (F) Elkins Sewer Charges. (1) Elkins' payment for wastewater treatment shall be based on 85% of the metered water purchased. The volume of wastewater received by Fayetteville at the "Point of Connection" shall be measured by the installed wastewater meter. Volumes of wastewater below or above the agreed upon percentage (85%) of metered water, as measured by the wastewater meter, shall be recorded on a monthly basis, with a reconciliation of the net difference to occur semiannually in June and December. If the reconciliation volume is over the agreed upon percentage, this amount shall be billed to Elkins in June and December at the actual computed cost of wastewater collection to and treatment at the Noland Wastewater Treatment Plant, not including the calculated rate of return and not including depreciation charges, but including any capacity surcharge, based on the most recent rate as determined in paragraph B of this contract. If the reconciliation volume is below the agreed upon percentage, the actual amount billed for the difference shall be refunded to Elkins in June and December (2) Elkins Impact Fee Charges. The City of Elkins shall pay an additional $0.25 per 1,000 gallons of wastewater, for all wastewater volume charges including both the 85% of metered water volume and for wastewater in excess of the 85% of the metered water purchased billed volume. (G) Hauled Wastewater Fees. (1) Application fee. An application to discharge hauled domestic waste must be accompanied by a fee of $100.00. (2) Discharge fee. A fee of $50.00 must be paid for each hauled domestic waste load discharged. (H) Industrial Wastewater Discharge Permit Fee. (1) Application Fee. An application for an industrial wastewater discharge permit must be accompanied by a fee of $500.00. (Code 1965, §21-26; Ord. No. 1165, 4-18-58; Ord. No. 3197, 7-1-86; Ord. No. 3285, 8-4-87; Ord. No. 3398, 1-3-89; Ord. No. 3491, 7-17-90; Ord. No. 3637, §§1, 2, 8-18-92; Ord. No. 4059, §2, 10-7-97; Code 1991, §51.137; Ord. No. 4530, 12-02-03; Ord. No. 4803, 12-20-05; Ord. No. 4998, 4-3-07; Ord. No. 5129, 4-15-08; Ord. No. 5438, 9-20-11; Ord. No. 5739, 2-17-15) (Supp. No. 25) Created: 2022-05-17 11:20:05 [EST] Page 11 of 11 Page 234 of 425 CITY OF FAYETTEVILLE. ARKANSAS Notice of Public Hearing on Proposed Water and Sewer Rate Changes City Council Agenda Session: Tuesday, June 14, 2022 at 4:30 PM City Council Meeting: Tuesday, June 21, 2022 at 5:30 PM City of Fayetteville Administration Building, City Hall 113 W. Mountain — Room 219 or via Zoom link at www.favetteville-ar.gov The City of Fayetteville AR, on the dates and times mentioned above, will hold a public hearing as part of the City Council Agenda Session and City Council Meeting with Fayetteville City Council prior to the adoption of the 2023 water and sewer rate increases. The public can attend in person or remotely via the link on the City's website, www.fayetteville- ar.gov. If adopted, the proposed new rates would take effect on or after January 01, 2023, with 3% increases annually thereafter. All property owners/tenants and other interested parties are invited to attend the public hearing and be heard on the matter. A water and sewer cost of service study was conducted by Black & Veatch pursuant to Fayetteville City Council Resolution 212-20 to perform a cost analysis to determine if costs allocations are fair and equitable among customer classes, to review the existing rate structure and design proposed rates that provide adequate revenues. The proposed water and sewer rate changes below are necessary for the City of Fayetteville to continue to provide safe and reliable water and sewer services to its citizens because extensive new capital needs are required at this point in time and operating costs have increased above the revenue increases generated by the current annual 3% proportional adjustment. 113 Page 235 of 425 PROPOSED WATER RATE CHANGES - ON OR AFTER 11112023 FIXED BASE A•GE $/MONTH WATER INSIDE CITY WATER OUTSIDE Meter SizeEXISTING 5/8" 3/4" 6.59 PROPOSED 6.59 CHANGE 0.0% EXISTING _ 7.54 7.54 PROPOSED 7.54 7.54 0.0% 0.0%- 6.59 6.59 0.0% ill 9.14 9.14 0.0% 10.52 12.26 16.5% 1.5" 15.93 15.93 0.0% 18.31 24.22 32.3% 2" 23.20 23.20 0.0% 26.66 33.52 25.7% 3" 54.05 54.05 0.0% 62.18 69.84 12.3% 4" 89.50 89.50 0.0% 102.93 102.93 0.0% 6" 178.99 178.99 0.0% 205.82 205.82 0.0% 8" • 000 GALLONS Residential First 2,000 gallons 268.41 268.41 0.0% 308.67 308.67 0.0% AVG 0.0% 3.51 3.30 -6.0% AVG 4.04 4.47 9.7% 10.6% Next 13,000 gallons 4.64 4.37 -5.8% 5.34 5.91 10.7% All over 15,000 gallons 6.59 6.20 -5.9% 7.54 8.38 11.1% on- esi entia First 300,000 gallons 3.79 AVG 3.93 -5.9% 3.7% 4.38 AVG 5.05 10.8% 15.3% All over 300,000 gallons 3.38 3.93 16.3% 3.90 5.05 29.5% All Usage First 300,000 gallons ;==4.29 5.04 AVG 10.0% 6.1% -14.9% 3.20 5.80 AVG 3.49 5.43 22.4% 9.1% -6.4% All over 300,000 gallons 4.53 4.29 -5.3% 5.22 5.43 4.0% "M Reduced Peak Demand AVG -10.1% 2.87 AVG 3.16 -1.2% 10.1% Peak Demand _ 3.20 3.16 -1.3% AVG 4.4% *Beginning January 1, 2024, all monthly water rates shall be increased by 3% per year Pagf 2 13 Page 236 of 425 PROPOSED SEWER RATE CHANGES - ON OR AFTER 11112023 FIXED BASE CHARGE $/MONTH MetSizeEXISTING 5/8" 3/4" SEWER 18.28 INSIDE CITY PROPOSEDPROPOSED 18.28 0.0% SEWER• 18.28 18.28 CHANGE 0.0% EXISTING 16.74 PROPOSED 25.10 • 49.9% 18.28 18.28 0.0% 18.28 18.28 0.0% 16.74 25.10 49.9% 1" 23.74 23.74 0.0% 33.92 33.92 0.0% 31.28 52.62 68.2% 1.5" 38.77 38.77 0.0% 60.37 66.73 10.5% 55.50 109.78 97.8% 2" 55.43 55.43 0.0% 79.73 93.11 16.8% 73.45 154.24 110.0% 3" 128.73 128.73 0.0% 184.24 196.10 6.4% 169.29 327.83 93.6% 4" 212.13 212.13 0.0% 303.44 303.44 0.0% 278.93 482.37 72.9% 6" 420.39 420.39 0.0% 601.46 601.46 0.0% 553.70 897.30 62.1% 8" • •00 GALLONS Residential First 2,000 Gallons All over 2,000 Gallons 628.73 628.73 0.0% 899.76 899.76 0.0% 826.81 998.92 20.8% AVG 0.0% 4.35 3.39 -22.1% AVG 3.8% 8.18 8.55 4.5% AVG 7.52 8.27 69.5% 10.0% 5.80 4.52 -22.1% 8.18 8.55 4.5% 7.52 8.27 10.0% Non -Residential All Usage _ Major I All Usage AVG -22.1% AVG 4.5% AVG 10.0% 4.40 5.10 15.9% 4.71 5.71 21.2% 8.18 8.55 4.5% 8.18 8.55 4.5% 7.52 8.27 7.52 8.27 10.0% 10.0% 7ReducedPeak Demand 5.19 7.20 38.7% k Demand 2.71 7.20 165.7% AVG 102.2% *Beginning January 1, 2024, all monthly sewer rates shall be increased by 3% per year For more information or questions about the proposed water and sewer rate changes, contact the City of Fayetteville, Utilities Financial Services Division at (479) 575-8224 or visit the City's website for at www.favetteville-ar.gov. Pagf 3 13 Page 237 of 425 Revised Draft 06/08/2022 Final Draft WATER AND WASTEWATER COMPREHENSIVE RATE STUDY B&V PROJECT NO. 406577 PREPARED FOR City of Fayetteville, Arkansas 8 JUNE 2022 13, BLACK&VEATCH Page 238 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table of Contents 1.0 Executive Summary.......................................................................................................... ES 1-0 1.1 Summary of Findings.................................................................................................. ES 1-0 1.1.1 Revenue Under Existing Rates.................................................................... ES 1-0 1.1.2 Revenue Requirements............................................................................... ES 1-1 1.1.3 Summary of Cash Flow Results................................................................... ES 1-2 1.1.4 Cost of Service Analysis............................................................................... ES 1-2 1.2 Proposed Rate Adjustments....................................................................................... ES 1-3 1.3 Disclaimer................................................................................................................... ES 1-4 2.0 Introduction......................................................................................................................... 2-0 2.1 Purpose............................................................................................................................ 2-0 2.2 Scope................................................................................................................................2-0 2.3 Study Methodology......................................................................................................... 2-1 2.3.1 Financial Plan....................................................................................................2-1 2.3.2 Cost of Service.................................................................................................. 2-1 2.3.3 Rate Design....................................................................................................... 2-2 3.0 Rate Structure Overview....................................................................................................... 3-0 3.1 Fixed Charge.....................................................................................................................3-0 3.2 Volumetric (Usage) Charge..............................................................................................3-0 3.3 Existing Rate Structure.....................................................................................................3-0 3.3.1 Water Rate Structure....................................................................................... 3-0 3.3.2 Wastewater Rate Structure..............................................................................3-1 4.0 Water Utility.........................................................................................................................4-1 4.1 Water Revenue Projections Under Existing Rates...........................................................4-1 4.1.1 Water Revenue Under Existing Rates..............................................................4-1 4.1.2 Projection of Service Revenue Under Existing Rates.......................................4-3 4.1.3 Other Water Revenue......................................................................................4-3 4.2 Water Capital Improvements Program............................................................................4-4 4.3 Water Revenue Requirements........................................................................................4-4 4.3.1 Water Operation and Maintenance Expenses.................................................4-4 4.3.2 Water Bad Debt................................................................................................4-5 4.3.3 Water Payment In Lieu of Taxes......................................................................4-5 4.3.4 Safe Drinking Water Fee Reimbursement........................................................4-5 4.3.5 Water Debt Service Requirements...................................................................4-6 4.3.6 Transfer to Shop Fund......................................................................................4-6 4.3.7 Transfer to Operating Reserve.........................................................................4-6 4.3.8 Water Cash Financed Capital...........................................................................4-6 4.3.9 Transfer to Capital Reserve..............................................................................4-6 4.4 Water Proposed Revenue Adjustments..........................................................................4-6 BLACK & VEATCH I Table of Contents i Page 239 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5 Water Cost of Service......................................................................................................4-8 4.5.1 Determination of Cost of Service.....................................................................4-8 4.5.2 Determination of Functional Costs..................................................................4-9 4.5.3 Allocation of Costs to the Functional Cost Components...............................4-10 4.5.4 Distribution of Water Utility Costs to Customer Classes...............................4-11 5.0 Water Rate Design.............................................................................................................. 5-14 5.1 Existing Water Rates......................................................................................................5-14 5.2 Proposed Water Rates...................................................................................................5-14 6.0 Wastewater Utility............................................................................................................... 6-1 6.1 Wastewater Revenue Projections Under Existing Rates.................................................6-1 6.1.1 Wastewater Revenue Under Existing Rates.....................................................6-1 6.1.2 Projection of Service Revenue Under Existing Rates.......................................6-3 6.1.3 Other Wastewater Revenue.............................................................................6-3 6.2 Wastewater Capital Improvements Program..................................................................6-4 6.3 Wastewater Utility Revenue Requirements....................................................................6-4 6.3.1 Wastewater Operation and Maintenance Expenses.......................................6-4 6.3.2 Wastewater Bad Debt...................................................................................... 6-5 6.3.3 Wastewater Payment In Lieu of Taxes.............................................................6-5 6.3.4 Wastewater Debt Service Requirements.........................................................6-6 6.3.5 Transfer to Shop Fund...................................................................................... 6-6 6.3.6 Transfer to Operating Reserve.........................................................................6-6 6.3.7 Wastewater Cash Financed Capital..................................................................6-6 6.3.8 Transfer to Capital Reserve.............................................................................. 6-6 6.4 Wastewater Proposed Revenue Adjustments.................................................................6-6 6.5 Wastewater Cost of Service............................................................................................. 6-8 6.5.1 Determination of Cost of Service..................................................................... 6-8 6.5.2 Determination of Functional Costs..................................................................6-9 6.5.3 Allocation of Costs to the Functional Cost Components.................................6-9 6.5.4 Distribution of Wastewater Utility Costs to Customer Classes ......................6-11 6.5.5 Wastewater Utility Customer Class Costs of Service.....................................6-12 7.0 Wastewater Rate Design.................................................................................................... 7-14 7.1 Existing Wastewater Rates............................................................................................7-14 7.2 Proposed Wastewater Rates......................................................................................... 7-14 8.0 Combined Water and Wastewater Utilities......................................................................... 8-15 9.0 Disclaimer.......................................................................................................................... 9-16 10.0 Appendix 1: Water Tables................................................................................................... 10-1 11.0 Appendix 2: Wastewater Tables......................................................................................... 11-1 BLACK & VEATCH I Table of Contents 11 Page 240 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study LIST OF EXECUTIVE SUMMARY TABLES Table ES - 1—Water 2023 Cost of Service..................................................................................................1-2 Table ES - 2 —Wastewater 2023 Cost of Service........................................................................................1-3 LIST OF FIGURES Figure 4-1 - Historical and Projected Water Accounts...............................................................................4-2 Figure 4-2 - Historical and Projected Water Billed Volume.......................................................................4-3 Figure 4-3 - Historical and Projected Water Service Revenue...................................................................4-3 Figure 4-4 - Projected Annual Water O&M Expenses................................................................................4-5 Figure 4-5 - Water Revenues and Revenue Requirements........................................................................4-7 Figure 6-1- Historical and Projected Wastewater Accounts..................................................................... 6-2 Figure 6-2 - Historical and Projected Wastewater Billed Volume............................................................. 6-3 Figure 6-3 - Historical and Projected Wastewater Service Revenue......................................................... 6-3 Figure 6-4 - Projected Annual Water 0&M Expense................................................................................. 6-5 Figure 6-5 - Wastewater Revenues and Revenue Requirements.............................................................. 6-7 LIST OF WATER TABLES Table W - 1- Water Projected Number of Accounts...............................................................................10-1 Table W - 2 - Water Projected Billed Volume (1,000 Gallons).................................................................10-2 Table W - 3 - Water Existing Rates...........................................................................................................10-3 Table W - 4 - Water Projected Revenues Under Existing Rates...............................................................10-4 Table W - 5 - Water Projected Other Revenues.......................................................................................10-4 Table W - 6 - Water Capital Improvement Program................................................................................10-5 Table W - 7 - Water Projected 0&M Expenses........................................................................................10-5 Table W - 8 - Capital Program Financing..................................................................................................10-6 Table W - 9 - Water Operating Cash Flow................................................................................................10-7 Table W - 10 - Water Fund Balances........................................................................................................10-8 Table W - 11 - Water 2023 Cost of Service..............................................................................................10-9 Table W - 12 - Water 2023 Allocation of Net Plant Investment to Functional Cost Components ........10-10 Table W - 13 - Water 2023 Allocation of Net Annual Depreciation to Functional Cost Components.................................................................................................................10-10 Table W - 14 - Water 2023 Allocation of O&M Expenses to Functional Cost Components ..................10-10 Table W - 15 - Water 2023 Estimated Units of Service..........................................................................10-11 Table W - 16 - Water 2023 Unit Cost of Service....................................................................................10-12 Table W - 17 - Water 2023 Cost of Service by Customer Class..............................................................10-13 Table W - 18 - Water Proposed 2023 Rates...........................................................................................10-14 Table W - 19 - Water 2023 Cost of Service Under Proposed Rates.......................................................10-15 Table W - 20 - Water 2023 Bill Impact...................................................................................................10-16 BLACK & VEATCH I Table of Contents iii Page 241 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study LIST OF WASTEWATER TABLES Table S - 1- Wastewater Projected Accounts..........................................................................................11-1 Table S - 2 - Wastewater Projected Billed Volume (1,000 Gallons).........................................................11-1 Table S - 3 - Wastewater Existing Charges...............................................................................................11-2 Table S - 4 - Wastewater Projected Revenues at Existing Rates..............................................................11-3 Table S - 5 - Wastewater Projected Other Revenues...............................................................................11-3 Table S - 6 - Wastewater Capital Improvement Program........................................................................11-4 Table S - 7 - Wastewater Projected O&M Expenses................................................................................11-4 Table S - 8 - Wastewater Cash Financed Capital......................................................................................11-5 Table S - 9 - Wastewater Operating Cash Flow........................................................................................11-5 Table S - 10 - Wastewater Projected Fund Balances...............................................................................11-6 Table S - 11 - Wastewater 2023 Cost of Service......................................................................................11-6 Table S - 12 - Wastewater 2023 Allocation of Net Plant Investment......................................................11-7 Table S - 13 - Wastewater 2023 Allocation of Depreciation....................................................................11-7 Table S - 14 - Wastewater 2023 Allocation of 0&M Expenses................................................................11-8 Table S - 15 - Wastewater 2023 Units of Service.....................................................................................11-9 Table S - 16 - Wastewater 2023 Unit Cost of Service............................................................................11-10 Table S - 17 - Wastewater 2023 Cost of Service by Customer Class......................................................11-10 Table S - 18 - Wastewater Proposed 2023 Charges...............................................................................11-11 Table S - 19 - Wastewater 2023 Cost of Service Under Proposed Rates...............................................11-12 Table S - 20 - Wastewater 2023 Bill Impact...........................................................................................11-12 LIST OF COMBINED TABLES Table C - 1 - Combined Projected Fund Balances ........... Table C - 2 - Combined Operating Cash Flow .................. Table C - 3 - Combined 2022 Bill Impact ......................... ...............12-1 ...............12-2 ...............12-3 BLACK & VEATCH I Table of Contents Page 242 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 1.0 Executive Summary The City of Fayetteville (City) provides water and wastewater services to retail and wholesale customers. The Water and Wastewater fund is an Enterprise Fund, which is funded by the operating and capital revenues from the users of the system. Due to multiple factors including increasing operating costs, significant capital investments to meet regulatory requirements, and the need for infrastructure rehabilitation and replacement, revenues under existing rates are not adequate to meet the annual revenue requirements. Therefore, to maintain financial sufficiency and to assure equitable cost recovery, the City engaged Black & Veatch Management Consulting, LLC (Black & Veatch) to perform a Water and Wastewater Comprehensive Rate Study (Study). The primary objectives of the Study are to develop a balanced financial plan, determine cost of service allocations for each customer class and design rates to recover costs from customer classes in reasonable accord with the allocated costs of service. The financial plan was developed for the six -year period of 2021 through 2026, also referred to as the study period or the forecast period. The city's fiscal year is a calendar year, starting on January 1 and ending on December 31. As a result of our evaluations and analyses, the following summary of findings and recommendations are offered for the City's consideration. 1.1 Summary of Findings 1.1.1 Revenue Under Existing Rates 1. The City provides retail water services to approximately 40,800 customers inside the City and about 7,000 customers outside the City. The number of retail water service customers inside the City is projected to increase to about 44,800 by 2026 and the number of outside City water customers is projected to increase to about 8,000. The City also provides treated water to four wholesale customers. Retail wastewater collection and treatment service is provided to approximately 36,900 customers inside the City and about 2,600 customers outside the City. The number of inside City wastewater service customers is projected to increase to about 40,600 by 2026 and the number of outside City wastewater service customers is projected to increase to about 2,700. 2. Treated water sales to inside City retail customers are projected to increase from approximately 3,146,800 1,000 gallons (kgals) in 2021 to approximately 3,388,000 kgals by 2026. Treated water sales to outside City retail customers are projected to increase from approximately 507,600 kgals in 2021 to approximately 519,400 kgals by 2026. Treated water sales to wholesale customers is projected to be approximately 219,100 kgals in 2021 and decrease to 202,300 kgals in 2022 and remain at that level through 2026. Billed wastewater volume from inside City retail customers is projected to increase from approximately 2,806,700 kgals in 2021 to approximately 2,961,800 kgals by 2026. Billed wastewater volume from outside City retail customers is projected to increase from 109,800 kgals in 2021 to about 117,400 kgals by 2026. Billed wastewater volume from wholesale customers is projected to increase from 81,000 kgals in 2021 to 126,600 kgals in 2026 due to the addition of West Fork as a wholesale wastewater customer starting December 2020. The annual wholesale wastewater volume is projected to remain at the 2021 level through 2026. BLACK & VEATCH I Executive Summary ES-1-0 Page 243 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 3. The City's current water rates became effective January 1, 2022. For both retail and wholesale customers, the water rates include a monthly base charge, which varies by meter size and a volume charge that varies by customer class. The existing schedule of rates for wastewater service became effective on January 1, 2022. For retail customers, the wastewater rates include a monthly base charge, which varies by meter size. The volume charge varies by customer class. Surcharge rates are based on excess strength of Biochemical Oxygen Demand (BOD) and Total Suspended Solids (TSS). The existing wastewater rate structure is described in Section 3.3.2. 4. Revenue is currently derived principally from charges for treated water and wastewater service, with some revenue also obtained fire protection charges and other miscellaneous sources. Revenue from treated water sales, under existing rates, is projected to increase from $21,186,400 in 2021 to about $22,986,800 in 2026, reflecting a 5-year cumulative increase of 8%. Miscellaneous water revenues are estimated to increase from $1,484,700 in 2021 to approximately $1,608,600 in 2026, reflecting a 5-year cumulative increase of 8%. Revenue for wastewater collection and treatment services is projected to increase from $24,461,900 in 2021 to about $26,697,600 in 2026, under existing rates, reflecting a 5-year cumulative increase of 9%. Miscellaneous wastewater revenue is estimated at $1,297,100 in 2021 and $1,420,200 per year through 2022 to 2026, reflecting a 5-year cumulative increase of 9%. 1.1.2 Revenue Requirements 1. Costs of service to be recovered from water and wastewater service charges include (1) operation and maintenance (0&M) expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) Safe Drinking Water Fee Reimbursement; (5) debt service (consisting of principal and interest payments); (6) transfer to shop fund; (7) transfer to operating reserve; (8) cash financed capital; and (9) transfer to capital reserve. The water and wastewater utilities do not have any outstanding debt service. There are no future debt issuances are planned over the study period and no transfers to the shop fund over the study period. 2. The annual O&M expense includes the cost of labor, materials, power, chemicals, purchased water, contract services and other expenses associated with each utility's operation. In this study, FY 2021 is defined as the base budget year, based on which the O&M costs are projected for the forecast period. O&M expense for the water utility is projected to increase from $15,949,600 in 2021 to $18,739,400 by 2026 due to the combined effects of inflation and system growth. O&M expense for the wastewater utility is projected to increase from $15,674,800 in 2021 to $18,395,700 by 2026 due to the combined effects of inflation and system growth. 3. Bad debt expenses refer to outstanding balances from customers that are deemed uncollectible. The water and wastewater bad debt in 2019 was 0.5% of revenue. Bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for water utility is projected to increase from $105,900 in 2021 to $129,000 by 2026. Annual bad debt expenses for wastewater utility is projected to increase from $122,300 in 2021 to $149,900 by 2026. 4. The Payment In Lieu of Taxes (PILOT) are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires the water and wastewater funds to pay 4.25% of annual total gross sales revenues to the City. Annual PILOT amount for the water utility is anticipated to increase from $900,400 in 2021 to $1,096,900 in 2026. Annual BLACK & VEATCH I Executive Summary ES-1-1 Page 244 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study PILOT amount for the wastewater utility is projected to increase from $1,039,600 in 2021 to $1,274,000 in 2026. 5. The Safe Drinking Water Fee (SDWF) revenue collected for each metered customer is reimbursed to the state of Arkansas Department of Public Health. The SDWF reimbursement is projected to increase from $230,000 in 2021 to $250,200 in 2026. The SDWF is a pass -through fee and is treated as a "revenue reduction" by the City. 6. The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve for the water utility is projected to increase from $133,000 in 2022 to $151,800 in 2026. The transfer to operating reserve for wastewater is projected to increase from $129,600 in 2022 to $147,900 in 2026. 7. The City currently utilizes the following two sources of funding for the water and wastewater utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. A capital project meets the requirements of using impact fees if the existing water or wastewater capacity is expanded due to growth. The wastewater capital improvement program for the study period is $69 million, of which $67 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. 1.1.3 Summary of Cash Flow Results The cash flow analysis performed based on the projected annual revenues under existing rates and the projected annual revenue requirements indicates a funding gap for both utilities beginning in 2021. Therefore, a series of 3% annual revenue adjustment is needed in both the water and wastewater utilities to achieve the goal of the operating fund revenues being self-sufficient and adequate to cover all of the O&M expenses, cash financing of the capital program, required transfers, and to maintain the minimum reserve requirements. Table W - 9, in Appendix 1 presents the cash flow analysis and the proposed series of revenue increases for the water utility, and Table S - 9, in Appendix 2 presents the same for the wastewater utility. 1.1.4 Cost of Service Analysis 1. The revenue requirements less any revenues from other sources provides the "net" annual operating fund revenue requirements (also referred to as "cost of service") that needs to be recovered through user rates and charges. A summary of the projected annual cost of service for 2023 is shown for water and wastewater in tables ES-1 and ES-2, respectively. Table ES - 1—Water 2023 Cost of Service 1 O&M Expenses 17,791,700 2 Depreciation 3 Return 4 Net Cost of Service 17,791,700 BLACK & VEATCH I Executive Summary 17,791,700 2,820,100 2,820,100 1,476,000 1,476,000 4,296,100 22,087,800 ES-1-2 Page 245 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Revised Draft 06/08/2022 Table ES - 2 —Wastewater 2023 Cost of Service 1 O&M Expenses 17,346,000 2 Depreciation 8,259,600 17,346,000 8,259,600 3 Return 132,600 132,600 4 Net Cost of Service 17,346,000 8,392,200 25,738,200 2. As a basis for design of a schedule of water and wastewater rates, the costs of service are allocated to the classes of customers in accordance with respective service requirements of each customer class. The resulting costs of service allocated to customer classes are summarized in Table W - 17 for water and Table S - 17 for wastewater. 1.2 Proposed Recommendations Based on the financial planning and cost of service analysis performed for the study period, the Black & Veatch team proffers the following series of recommendations: 1. Implement a series of 3% annual revenue increase from 2024 to 2026 for both water and wastewater utilities. 2. Implement cost of service -based rates for water and wastewater utilities in 2023. 3. Transition the existing monthly Base charge to the proposed Base Charge, derived based on cost of service, if cost of service based proposed Base Charge is greater than the existing Base charge. 4. Eliminate the minimum volume charge billing of 1,000 gallons from the volumetric portion of the rate structure. 5. Continue with the existing tier block structure for customer classes that have an inclining block (residential) or a uniform block (industrial) for the volumetric rate structure. 6. Change to uniform block for customers that currently have a declining block (non-residential and irrigation) volumetric rate structure. The aforementioned recommendations enable the water and wastewater utilities to meet all its financial obligations, so that the City can continue to provide reliable service to serve the needs of existing and future customers. BLACK & VEATCH I Executive Summary ES-1-3 Page 246 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 1.3 Disclaimer This report was prepared for the City of Fayetteville (Client) by Black & Veatch Management Consulting, LLC (Black & Veatch) and is based on information provided by the Client not within the control of Black & Veatch. While it is believed that the information, data and opinions contained herein will be reliable under the conditions and subject to the limitations set forth in this report, Black & Veatch does not guarantee the accuracy thereof. Black & Veatch has assumed that the information provided by others, both verbal and written, is complete and correct. The projections set forth in this report are intended as "forward -looking statements." In formulating these projections, Black & Veatch has made certain assumptions with respect to conditions, events, and circumstances that may occur in the future. While Black & Veatch believes the assumptions are reasonable actual results may differ materially from those projected, as influenced by the conditions, events, and circumstances that occur. As such, Black & Veatch does not take responsibility for the accuracy of data or projections provided by or prepared on behalf of the Client, nor does Black & Veatch have any responsibility for updating this report for events occurring after the date of this report. Use of this report or any information contained therein by any party other than the Client, shall constitute a waiver and release by such third party of Black & Veatch from and against all claims and liability, including but not limited to liability for special, incidental, indirect or consequential damages in connection with such use. Such use of this report by a third party shall constitute agreement by the third party user that its rights, if any, arising from this report shall be subject to the terms of this Report Limitations, and in no event shall the third party's rights, if any, exceed those of the Client under its contract with B&V. The benefit of such releases, waivers, or limitations of liability shall extend to the related companies and subcontractors of any tier of B&V, and the shareholders, directors, officers, partners, employees, and agents of all released or indemnified parties. BLACK & VEATCH I Executive Summary ES-1-4 Page 247 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 2.0 Introduction The City of Fayetteville water utility provides treated water and water distribution services to approximately 40,800 customers within the corporate limits of Fayetteville, and to approximately 7,000 customers in areas contiguous to, but outside of the City's corporate limits. The wastewater utility provides retail wastewater collection and treatment service to approximately 37,000 customers within the corporate city limits and to approximately 2,600 customers outside of the City's corporate limits. The City also provides treated water to four wholesale customers and wastewater treatment to two wholesale customers. In providing water and wastewater service, the City incurs considerable expense related to the ongoing operating and capital needs of the utilities. These operating and capital expenditures tend to increase annually due to the combined effects of inflation and the need to repair, replace, or extend existing service facilities to meet customer service requirements, as well as to meet more stringent state and federal water quality requirements and EPA requirements. The City of Fayetteville, recognizing the importance of financial planning and cost of service analysis to equitably recover the increasing costs to replace, renew, expand, improve, and operate its water and wastewater service facilities, retained Black & Veatch to perform this comprehensive study of revenue requirements, cost of service, and rates for potable water service and wastewater service. 2.1 Purpose This report examines the respective projected revenue and rate requirements of the water and wastewater systems of the City. The purpose of this report is (1) to project the future revenues of the water and wastewater utilities under existing rates and charges, as well as the operating expenses and capital financing revenue requirements of the two utilities, and to examine the adequacy of projected revenues to meet these revenue requirements through calendar year 2026; (2) to allocate these revenue requirements, or costs of service, for a representative test year to the various customer classes in accordance with the respective service requirements that each class places on the systems; and (3) to develop a suitable schedule of water and wastewater rates that will produce revenues adequate to meet the financial needs of the utility on a basis that recognizes customer costs of service, existing wholesale service agreements and practical bill impact considerations. 2.2 Scope This report presents the results of a comprehensive study of the projected revenue and revenue requirements, costs of service allocations, and proposed rates for treated water and wastewater service. Revenue and revenue requirements are projected for the five calendar years from 2022 through 2026, recognizing anticipated growth in number of customers, water use, and wastewater flows throughout the service area. The study of revenue requirements recognizes projected operation and maintenance expense, capital improvement requirements met from revenues, principal and interest payments on outstanding and proposed bond issues, and reserve fund requirements. Requirements of existing revenue bond indentures are also recognized. Costs of treated water and wastewater service are developed for each group of customers and type of service based on consideration of utility revenue needs and projected customer service requirements. Rate adjustments are designed for retail and wholesale customers in accordance with allocated costs of service, wholesale service agreement terms, and customer bill impact considerations. BLACK & VEATCH I Introduction 2-0 Page 248 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 2.3 Study Methodology The development of user rates and charges requires the integration of three critical components: (i) financial plan; (ii) cost of service allocations; and (iii) rate design. 2.3.1 Financial Plan The development and update of a financial plan is necessary to continue to focus on financial discipline, build financial stability, and maintain sustainable financial planning Financial Planning practices. The financial planning process helps to establish a financial roadmap to meet all of the water and wastewater utility's obligations. As illustrated in Figure 2 - 1, the key components of a financial plan are: (i) projection of revenues from user rates and other sources; (ii) development of a capital financing plan to decide the mix of debt and cash funding of capital program; (iii) projection of revenue requirements (O&M and capital costs, and target reserves); and (iv) determination of the level and timing of revenue adjustments needed to maintain financial viability. The annual revenue requirements are typically developed on a cash - needs basis for public utility rate setting. The revenue requirements, under the cash -needs basis approach, include the following: O&M expenditures; Debt service expenses; Cash financing of capital program; Contributions to operating reserves; and roject Lvenues Review Project Pro -Forma Revenue Requirements Scenario ---------- ------------ Planning E Develop Capital % Rev Financing Plan Adjustments Figure 2 - 1: Financial Plan Other obligations such as payments and transfers for specific purposes. To establish financial stability, a financial plan is typically prepared for a multi -year period. A six -year financial plan was developed for L Cost of Service Analysis the water and wastewater utility to achieve the financial objectives and target metrics defined to build and sustain financial integrity. 2022 through 2026 is the forecast period for both revenues and Allocate Costs revenue requirement projections. I The revenue adjustments represent the level of annual revenue Develop Units Unit Costs increases necessary to meet the annual net revenue requirements. of Service 2.3.2 Cost of Service Distribute Cost of service can be described as the revenue that the water and Allocated Costs Based wastewater utility need to generate, net of funding from other on Service miscellaneous sources of revenues. Therefore, Cost of Service is Requirements essentially the "net revenue requirement" that is to be recovered through user rates and charges. As illustrated in Figure 2 - 2, Cost of Figure 2 - 2: Cost of Service service analysis enables an equitable apportioning of the net annual revenue requirements (also referred to as cost of service) to the various cost components and customer BLACK & VEATCH I Introduction 2-1 Page 249 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study classes. The level and types of allocation performed depend on the existing and anticipated rate structure. As municipal utilities are public utilities that cannot make a profit, the equitable allocation of costs is a critical step that is necessary to establish a reasonable nexus between costs incurred in providing service and the fees charged from customers, and to establish defensible user rates and charges. 2.3.3 Rate Design The third and final component is an evaluation of the existing rate structure components and the development of proposed user rates and charges. The user rates and charge schedules typically include fixed charge, volumetric charge, and other special charge rate components. As illustrated in Figure 2 - 3, the rates and charges are designed to recover the annual cost of service allocated to these different rate components and based on local policy and practical considerations. The study methodology described above and used in the financial planning, cost of service and rate design analysis reflect the application of industry accepted rate setting approaches that are provided in the following two guidance manuals: American Water Works Association (AWWA) Manual M-1: Principles of Water Rates, Fees, and Charges for water rate setting; and Rate Design Review Develop COS 1 Rates Scenario Planning Develop Practical Rates Proposed ---------------------------------- Rates Figure 2 - 3: Rate Design Water Environment Foundation (WEF) Financing and Charges for Wastewater Systems for wastewater. BLACK & VEATCH I Introduction 2-2 Page 250 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 3.0 Rate Structure Overview The revenue requirements of a water and wastewater utility, net of any miscellaneous sources of revenues, are recovered from user rates and charges. A water rate structure usually consists of two primary components, namely, a fixed charge and a volumetric charge. Similarly, a wastewater rate structure more commonly consists of a fixed charge, a volumetric charge, and pollutant charge (for wastewater pollutants such as Bio-chemical Oxygen Demand (BOD) and Total Suspended Solids (TSS). Occasionally, a utility's water and wastewater rate structures may include special surcharges and/or special assessments to recover costs associated with certain service situations such as purchased water, pumping to elevations, drought conditions, readiness -to -serve, environmental conditions, and extra - strength wastewater discharges. 3.1 Fixed Charge A utility's annual revenue requirements comprise mostly of fixed costs such as salaries and benefits, pension obligations, debt service, cash financing for infrastructure renewal, and costs related to the provision of adequate capacity for service. These types of fixed costs occur on a recurring basis regardless of the amount of water used by the customer. Therefore, rate structures need to afford the ability to recover at least some of the fixed costs based on billing parameters that are not related to water usage or wastewater flow. The fixed charge, which is assessed regardless of the volume of water used, provides a mechanism to reliably recover some of the fixed annual operating costs of the utility, and provide for some level of revenue stability. In the utility industry, fixed charges are designed to recover one or more of the following types of costs, namely, (i) metering; (ii) billing; (iii) readiness -to -serve cost; (iv) specific capital investment; and (v) other specific costs. The costs of providing these functions vary among types of customers and/or by factors such as size and capacity of the meters. Therefore, to provide for equitable cost recovery, water and wastewater fixed charges are usually assessed based on meter size and also by customer class. 3.2 Volumetric (Usage) Charge In the utility industry, usage charges are designed to recover all other costs (except those that are recovered through fixed charge) associated with the treatment and delivery of water service and the collection, treatment, and disposal of wastewater. The three common types of volumetric charge are: (i) inclining block rate, where the usage in the next higher usage block is priced at a higher rate per unit; (ii) uniform block rate, where all units of usage are priced at the same unit rate; and (iii) declining block rate, where the usage in the next higher usage block is priced at a lower rate per unit. As usage patterns vary among customer classes and consequently different classes place different levels of service demands, different volumetric rates can be established for the various customer classes. In designing the volumetric rate structure, practical considerations including conservation, equity, affordability, and ease of administration are addressed. 3.3 Existing Rate Structure 3.3.1 Water Rate Structure Consistent with industry rate structures, the City's water rate structure comprises of both Fixed Charge and Volumetric Charge components. The water rate structure includes the following two components: BLACK & VEATCH I Rate Structure Overview 3-0 Page 251 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Base Charge (Fixed Charge); and Volume Charge (Volumetric Charge). Some of these components are applicable to only specific customer classes. The revenues derived from the above charges are collectively referred to as water Service Kevenues. ■ Base Charge The existing Base Charge for all customer classes is based on meter size. ■ Volume Charge. The existing Volume Charge is based on the quantity of water used by the customers. ■ Safe Drinking Water Fee: This is a regulatory charge per bill that is collected by the City on behalf of the state of Arkansas Department of Public Health. The customer classes to which the specific charge components apply is illustrated in Figure 3 -1. The existing water rate schedule for 2022, for these rate components, is presented in Table W - 3 in Appendix 1. All customers are billed monthly. Figure 3 - 1: Existing Water Rate Structure • Base Charge by Meter Size Volume Rate (3-Tier Inclining Block) Minimum Usage (1,000 Gallons) Volume Rate (2-Tier Declining Block) Minimum Usage (1,000 Gallons) Volume Rate (Uniform) Minimum Usage (1,000 Gallons) Volume Rate ( Uniform) 2 rates (Reduced Peak Demand and Peak Demand) Safe Drinking Water Fee (per month) 3.3.2 Wastewater Rate Structure Retail Inside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Retail Outside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Wholesale Retail Inside City Residential; and Retail Outside City Residential Retail Inside City Non -Residential, Irrigation; and Retail Outside City Non -Residential, Irrigation Retail Inside City Major Industrial Retail Outside City Major Industrial Wholesale • All customer classes The City's Operating Fund wastewater rate structure also comprises of both Fixed Charge and Volumetric Charge components. The wastewater rate structure includes the following three components: Base Charge (Fixed Charge); BLACK & VEATCH I Rate Structure Overview 3-1 Page 252 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Volume Charge (Volumetric Charge); and BOD and TSS Charge (Surcharge). The revenues derived from all these three sources are collectively referred to as "Wastewater Service Revenues. Some of these user rate components are applicable to only specific customer classes. ■ Base Charge: The existing Base Charge for all retail customers is based on meter size. ■ Volume Charge. The existing volume wastewater charge is based on the quantity of water used by the customer classes. Surcharge: The existing wastewater surcharge is based on the excess strengths of BOD and TSS, of certain customers. The customer classes to which the specific rate components are applicable is illustrated in Figure 3 - 2. The existing wastewater rate schedule for 2022 is presented in Table S - 3 in Appendix 2. Figure 3 - 2: Existing Wastewater Rate Structure • Base Charge by Meter Size • Retail Inside City (Residential, Non -Residential and Major Industrial); • Retail Outside City (Residential, Non -Residential and Major Industrial); Volume Rate (2-Tier Inclining Block) Retail Inside City Residential Based on winter water usage of December, January and February • Volume Rate (Uniform) Retail Inside City (Non -Residential and Major Industrial) Retail Outside City (Residential, Non -Residential and Major Industrial) Volume Rate ( Uniform) Wholesale 2 tiered rates (85% of metered water usage and Above 85% of metered water usage) BLACK & VEATCH I Rate Structure Overview 3-2 Page 253 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.0 Water Utility The financial plan and rate design were developed to meet all the funding obligations of the water utility, and to achieve the financial adequacy and equitable cost recovery discussed in Section 2.3. The water utility financial plan was developed for the six -year forecast period of 2021 through 2026, and includes the following key components: Revenue projections (user rate revenues and non -rate revenues); Capital improvement program financing; Annual revenue requirement projections; and Annual proposed revenue increases 4.1 Water Revenue Projections Under Existing Rates The water utility revenues are derived from the following sources: Water Service Revenues (Base and Volume Charge) Other Revenues As a first step in the development of the financial plan, Water Service Revenues under the 2022 existing rates are projected for the forecast period. 4.1.1 Water Revenue Under Existing Rates As described in Section 3.3.1, the Water Service Revenue consists of two charge components. For each of the two components, revenues are projected based on billing units and applicable existing rate schedules. The billing units necessary to compute the Base Charge revenues are the number of accounts based on meter size and customer class. The billing units necessary to compute the Volume Charge are the annual water usage by customer class and by applicable blocks of usage. 4.1.1.1 Projection of Customer Accounts Typically, historical billing units are reviewed and used to project billing units for the forecast period. The project team reviewed historical accounts and average usage trends for each customer class referenced in Section 3.3.1. Based on the review of historical trends, two annual adjustment factors were applied to project billing units for the forecast period. The two adjustment factors applied at the customer class level are accounts growth rate and usage factor. The number of accounts is projected to grow in all customer classes except for Fire protection and wholesale where the number of accounts is anticipated to remain at the 2020 level. The total number of water accounts (not including private fire connections) is anticipated to increase from about 48,620 in 2021 to about 52,850 in 2026, at an overall annual system growth rate of 1.7%. The number of private fire connections is anticipated to remain at 727 throughout the study period. Table W - 1 in Appendix 1 presents the projected annual number of water accounts and private fire connections for the period of 2021 through 2026. BLACK & VEATCH I Water Utility 4-1 Page 254 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 4-1 presents both the historical and projected number of accounts for the water utility. Water Utility Historical and Projected Accounts 60,000 50,000 — — — — — — 40,000 30,000 20,000 10,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 4-1 - Historical and Projected Water Accounts 4.1.1.2 Projection of Water Usage Billed water volumes are projected based on estimates of the number of water accounts and the average billed usage per account. Average water use per account is determined based on historical usage. The historical usage per account for all customer classes varies each year between 2016 and 2020. In 2020, the COVID pandemic led to stay-at-home measures and shut down of non -essential businesses across the country. Consequently, the residential customers used more water in 2020, whereas the non-residential customers used less water as compared to previous years. The average use per account for 2021 was projected to remain at the 2020 levels assuming a lingering effect of the pandemic. The average usage per account for 2022 and beyond was projected to return to the 2019 level for all customer classes assuming a return to pre -pandemic levels. Total system water usage is projected to increase from 3,873,500 kgals in 2021 to 4,109,400 kgals in 2026. Table W - 2 in Appendix 1 presents the projected annual volume for the period of 2021 through 2026. Figure 4-2 presents both the historical and projected annual billed volume for the water utility. Water Utility Historical and Projected Billed Volume (1,000 Gallons) 4,200,000 4,100,000 r 4,000,000 3,900,000 r 3,800,000 3,700,000 3,600,000 3,500,000 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected BLACK & VEATCH I Water Utility 4-2 Page 255 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 4-2 - Historical and Projected Water Billed Volume 4.1.2 Projection of Service Revenue Under Existing Rates Water service revenues for the period 2021 through 2026 are projected for each charge component (base and volume) based on the projections of accounts by meter size, projected water usage for each customer class, and the application of the 2021 rate schedule for 2021 revenues and 2022 rate schedule for 2022 through 2026 revenues. Water service revenue under existing rates is projected to increase slightly from $21.2 million in 2021 to $23.0 million in 2026. This growth is due to increase in water sales due to the growth in the number of accounts over the study period. Table W - 4 in Appendix 1 presents the projected annual service revenues for the period of 2021 through 2026. Figure 4-3 presents both the historical and projected annual service revenues under existing rates for the water utility. Water Utility Historical and Projected Service Revenues (Under Existing Rates) $25,000,000 $20,000,000 $15,000,000 $10,0W000 $5,000,000 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 4-3 - Historical and Projected Water Service Revenue 4.1.3 Other Water Revenues The other revenues include the following major components: Impact Fee Revenue; Water/Rural Water Connection Fees; Miscellaneous Fees (Water Sales Not on Computer, Trip Fees, Tampering -Billed Service) Penalties; and Safe Drinking Water Fee (pass -through) The annual revenues from water impact fees, water connection fees and miscellaneous fees for 2021 to 2026 are projected based on historical three-year (2018 to 2020) average revenues for each of the fees. The penalties revenue in 2020 reflects only the first two and half months of revenues, as the City stopped assessing penalties for non-payment due to the pandemic. The revenue for penalties in 2021 is projected to be half of the historical three -year (2017 to 2019) average revenues due to continued waiver of the penalties as a result of the COVID pandemic during the first half for 2021. The revenue BLACK & VEATCH I Water Utility 4-3 Page 256 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study from penalties in 2022 and beyond is projected as the historical three-year average (2017 to 2019) average revenues. Table W - 5 in Appendix 1 presents the historical and projected annual service revenues for the period of 2021 through 2026. The Safe Drinking Water Fee (SDWF) is assessed for all water users in the state of Arkansas. The current rate is $0.40 per bill per month and is collected by all water utilities in the state. The SDWF revenue is projected by applying the current rate to the number of meters for the period 2021 to 2026. The revenue collected as part of this fee is reimbursed to the state. 4.2 Water Capital Improvements Program The capital project costs provided by the City were based on 2020 dollars. Based on discussions with the City, the project costs are inflated at an annual rate of 3.0% to accurately reflect the costs of projects for 2021 and beyond. The water utility Capital Improvement Plan (CIP) provides for a total of $49.0 million of investments during the study period of 2021 through 2026. Table W - 6 in Appendix 1 presents the CIP list of projects and schedule for 2021 through 2026 The CIP is expected to be financed from a funding mix of cash financing from service revenue and impact fees. 4.3 Water Revenue Requirements Projection of reliable revenue requirements includes: (1) operation and maintenance expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) SDWF Reimbursement; (5) debt service (consisting of principal and interest payments); (6) transfer to shop fund; (7) transfer to operating reserve; (8) cash financed capital; and (9) transfer to capital reserve. The projections of annual revenue requirements for the study period is discussed in this section. 4.3.1 Water Operation and Maintenance Expenses The O&M expenses for the water utility include the annual expenses associated with the water purchases from Beaver Water District; storage and distribution; meters and services; billing and collection, and general administrative services. These expenses include personnel costs (salaries and benefits), costs for materials and supplies, costs of utilities, and contracted services. The 2021 O&M budget provided by the City was used as the baseline for projection of O&M expenses for the study period. In addition, costs associated with a water inspector (not included in the 2021 budget) recurring salary and benefits costs, recurring vehicle maintenance costs and one-time cost of the vehicle purchase was added per City's direction. Based on historical 0&M costs, industry experience, and discussions with the City management, appropriate escalation factors were applied to various categories of costs to project future annual 0&M expenses. Annual escalation factors used for major cost categories include the following: Salaries: 4.00% Benefits: 5.00% Energy: 3.00% Chemicals: 3.00% Purchased Water: 3.00% BLACK & VEATCH I Water Utility 4-4 Page 257 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The annual O&M expenses for water utility are budgeted at $15.9 million in 2021 and are projected to grow to $18.7 million by 2026. Table W - 7 in Appendix 1 presents a summary of total projected operation and maintenance expense for the period 2021 through 2026. Figure 4-4 presents the historical and projected O&M expenses for the water utility. Water Utility Historical and Projected O&M Expenses S25,000,000 S20,000,000 S15,000,000 ........ — S10,000,000 $5,000,000 k 2020 2021 2022 2023 2024 2025 Historical — — Projected Figure 4-4 - Projected Annual Water O&M Expenses 4.3.2 Water Bad Debt Bad debt expenses refer to outstanding balances owed that are deemed uncollectible. The water bad debt in 2019 was 0.5% of revenue. Hence, bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for water utility is projected to increase from $105,900 in 2021 to $125,300 by 2026 reflecting the increase in projected revenues. Line 12 in Table W - 9 in Appendix 1 presents the projected bad debt for the period 2021 through 2026. 4.3.3 Water Payment In Lieu of Taxes The PILOT costs are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires that the water and wastewater funds to pay 4.25% of annual total gross sale revenues to the City. Annual PILOT amount for the water utility is calculated by multiplying actual water revenues from prior year (Water sales on Computer and Water sales not on Computer/ Bulk Water Sales, and Fire Hydrant and Protection). Annual PILOT amount for the water utility is anticipated to increase from $900,400 in 2021 to $1,064,900 in 2026. Line 13 in Table W - 9 in Appendix 1 presents the projected PILOT expenses for the period 2021 through 2026. 4.3.4 Safe Drinking Water Fee Reimbursement The SDWF revenue collected for each metered customer is reimbursed to the state of Arkansas department of Public Health. The SDWF reimbursement is projected to increase from $230,000 in 2021 to $250,200 in 2026. Line 14 in Table W - 9 in Appendix 1 presents the projected SDWF reimbursement for the period 2021 through 2026. BLACK & VEATCH I Water Utility 4-5 Page 258 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.3.5 Water Debt Service Requirements The water utility does not have any outstanding debt service obligations. The City does not anticipate any debt issuances during the study period, therefore there is no projected debt service for future debt as shown in Line 15 in Table W - 9 in Appendix 1. 4.3.6 Transfer to Shop Fund The transfer to the shop fund is made by the utility whenever a new vehicle (associated with new personnel) is purchased, thereby expanding the existing fleet. There are no projected transfers to the shop fund over the study period as shown in Line 17 in Table W - 9 in Appendix 1. 4.3.7 Transfer to Operating Reserve The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve is projected to increase from $133,000 in 2022 to $151,800 in 2026 reflecting the growth in the O&M budget. Line 18 in Table W - 9 in Appendix 1 presents the projected transfers to the operating reserve for the period 2021 through 2026. 4.3.8 Water Cash Financed Capital The City currently utilizes the following two sources of funding for the water utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. As stated in Section 4.2, the water capital improvement program for the study period is $52 million, of which $50 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. A capital project meets the requirements of using impact fees if the existing water capacity is expanded due to growth. The construction contract and the budget amendment to change the source of funding to impact fee must be approved by the City Council. Table W - 8 in Appendix 1 presents the sources of funding for the water capital improvement program. Line 19 in Table W - 9 in Appendix 1 presents the projected transfers for cash financed capital for the period 2021 through 2026. 4.3.9 Transfer to Capital Reserve The water utility, after meeting all the obligations stated in sections above, transfers the excess funds to the capital reserve fund. The capital reserve fund is used as a source for funding the capital program in the years that the revenues are not sufficient to meet the capital funding requirements. Line 20 in Table W - 9 in Appendix 1 presents the projected transfers to and from the capital reserve for the period 2021 through 2026. 4.4 Water Proposed Revenue Adjustments The annual revenue adjustments that are needed to achieve the defined financial performance objectives are determined by evaluating the funding gap between the projected annual revenue requirements and the projected revenues under existing rates. Table W - 9 in Appendix 1, provides a summary of the revenue and revenue requirements (financial plan) for the study period. Projected Revenue Under Existing Rates: Line 1 indicates that under existing rates (2022 rates) water utility revenues will increase from $21.8 million in 2022 to $23.0 million in 2026. Projected Other Revenues: Line 8 indicates that the other revenues are anticipated to increase from $641,500 in 2022 to $662,300 in 2026. This increase is due to the growth in SDWF, which is a pass - through. It is anticipated that all other categories of other revenues will remain flat throughout the study period. BLACK & VEATCH I Water Utility 4-6 Page 259 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Projected Expenses: Line 15 indicates the total annual expenses for the water utility are anticipated to increase from $17.7 million in 2022 to $20.2 million in 2026. Projected Transfers: Line 20 indicates the total annual transfers for the water utility are anticipated to increase from $4.7 million in 2022 to $5.6 million in 2026. Funding Gap: The cash flow analysis indicates that the sum of revenues under existing rates and the other revenues is not adequate to fund the projected annual revenue requirements, thereby causing an operating deficit. Proposed Revenue Adjustments: To address the funding gap in the water utility, a series of revenue adjustments are proposed as follows: 2024: 3% effective (January 1, 2024) 2025: 3% effective (January 1, 2025) 2026: 3% effective (January 1, 2026) Lines 2 through 7 present the amount of additional revenues generated each year with the proposed magnitude and timing of revenue adjustments. Figure 4-5 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Water Utility Revenues and Revenue Requirements S30,000,000 S25,000,000 520,000,000 S 15,000,000 S 10,00o,000 $5, 000, 000 $0 2021 2022 2023 2024 2025 2026 O&M Expenses Cash Financing of Capital Other Transfers Revenues Under Existing Rates Revenues Under Proposed Rates Figure 4-5 - Water Revenues and Revenue Requirements Table W - 10 in Appendix 1 presents the water utility's operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: ■ O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. ■ Operating Fund Balance: A minimum target of $100,000. BLACK & VEATCH I Water Utility 4-7 Page 260 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study ■ Capital Fund Balance: A minimum target of $500,000. ■ Capital Reserve Fund Balance: An amount necessary to fully fund anticipated capital projects. As shown in Table W - 10, the proposed annual revenue adjustments will allow the water utility to meeting the minimum fund balance requirements for all funds through 2026. 4.5 Water Cost of Service A key step to developing an equitable rate structure involves the cost of service analysis. The financial plan discussed in sub sections 4.1 through 4.4 provides an estimate of the total annual revenue requirements for a given fiscal year. The cost of service analysis provides a mechanism to defensibly allocate the total annual revenue requirements to the various customer classes. The cost of service is typically performed for a single year, referred to as the "Test Year" for which the rates are to be designed. The test year for which the cost of service study was performed is 2023. The key components of the cost of service analysis are: Determination of Cost of Service (net revenue requirements); Determination of Functional Costs; Allocation of Functional Costs to Cost Components; and Distribution of Water Utility Costs to Customer Classes 4.5.1 Determination of Cost of Service The first step is to determine the cost of service that is to be recovered from user rates and charges. As briefly discussed in Section 2.3, cost of service is defined as, and synonymous with, the "net revenue requirement" that is to be recovered for the test year through user rates and charges. Table W - 11 in Appendix 1 presents the derivation of the cost of service to be recovered through water charges. As Line 18 in Table W - 11 indicates, the water cost of service for 2023 is projected to be $22.1 million. This cost of service consists of $17.8 million of net C&M expense and $4.3 million of net capital costs. Costs of service is apportioned among customer classes in this study on a "Utility Basis", that is, in terms of operating expense, depreciation expense, and return. For a municipal utility, the total of depreciation expense and return is equal to the capital cost related portion of the total cost of service. Depreciation is the loss in value of the original plant investment, not restored by current maintenance, due to wear, decay, inadequacy, and obsolescence. Annual depreciation is determined as a percentage of original investment based on expected service lives of the various facilities. Unless funds are provided for normal annual replacement of original plant items, operating reliability of the system, as well as the value, will decrease. Depreciation funds are used to finance principal payments on bond issues and provide normal annual capital expenditures. The depreciation expense associated with the water utility is estimated in this study recognizing depreciation rates presently in use by the water utility. This results in a projected test year depreciation expense of $2.8 million exclusive of depreciation on contributed plant, which is not recognized for cost BLACK & VEATCH I Water Utility UK Page 261 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study allocation or rate design purposes. The contributed plant adjustment is consistent with generally accepted regulatory practices. Total return on the system investment provides funds for bond interest payments and any other costs that may be incurred. In developing the level of return on net plant serving the requirements of outside City customers, provisions for a reasonable margin should be made to meet interest on borrowed funds, and to recognize the business risk assumed by the City in providing reliable facilities to serve nonresident customers. Total return for the test year is projected to be $1,476,030 as shown on Line 17 of Table W - 11 in Appendix 1. 4.5.2 Determination of Functional Costs As a basis for developing an equitable rate structure, the test year cost of service should be allocated to the various customer classes according to respective service requirements. The basic underlying principle in developing cost of service rates is the determination of what elements in a water system are responsible for causing the level of revenue requirements that is needed. To allocate the costs to customer classes, first the operating and capital costs of service are aggregated into "Functional Cost Centers." The functional costs are then further allocated to cost components. Each component cost is then apportioned to customer classes Functional Cost Centers Functional cost centers of a water utility represent the activities that contribute to the incurrence of O&M and capital costs. For a water utility, they often include source of water supply, pumping, treatment, storage, distribution, meters, billing, and other administration costs. Both the O&M and capital costs defined for the Test Year, discussed in 4.5.1, need to be allocated to functional cost centers. Functional Costs The capital costs associated with the functional cost centers are determined using detailed fixed assets data, provided by the City, for each class of asset that is currently in service, construction work in progress and projected capital improvement program for the test year. The total value of the fixed assets (referred to as "Net Plant Investment") in the system is usually presented as Original Cost Less Depreciation ("OCLD"). The total estimated OCLD of the water system is $104 , as presented in Line 9 in Table W - 12 in Appendix 1. This plant investment data is subsequently used as a basis for the allocation to cost components, discussed in the following subsection 4.5.3.2. The O&M costs for the Test Year are allocated to the various functional cost centers based on the specific nature of costs. The allocation of the projected O&M cost of service (net operating revenue requirement) of $17.8 million, to the various functional cost centers, is presented in Table W -14 in Appendix 1. The various cost elements of water service are assigned to functional cost components as the first step in the subsequent distribution of the costs of service to customer classes. BLACK & VEATCH I Water Utility 4-9 Page 262 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5.3 Allocation of Costs to the Functional Cost Components The principal functional cost components consist of Base Costs, Extra -Capacity Costs, and Customer Costs. Base costs are those which vary directly with the quantity of water used, as well as those costs associated with serving customers under average load conditions without the elements necessary to meet water use variations or peak demands. Base costs include purchased power and treatment chemicals, and other operating and capital costs of the water system associated with serving customers to the extent required for a constant, or average annual rate of use. Extra -Capacity costs represent those operating costs incurred due to demands in excess of average, and capital related costs for additional plant and system capacity beyond that required for the average rate of use. Total extra capacity costs are subdivided into costs associated with maximum day and maximum hour demand. Customer Costs are defined as costs which tend to vary in proportion to the number of customers connected to the system. These include meter reading, billing, collection and accounting costs, and maintenance and capital charges associated with meters and services. The delineation of costs of service into these principal categories provides the means of further allocating such costs to the various customer classes based on the respective base, extra capacity, and customer service requirements of each customer class. Wholesale customers generally do not use smaller water distribution mains as do retail users. Therefore, separate functional cost of service categories are designated for costs which are common to all customer classes and those which are common to retail service classes only. 4.5.3.1 Water Utility Allocation to Cost Components The water utility is comprised of a variety of service facilities, each designed and operated to fulfill a given function. In order to provide adequate service to its customers at all times, the utility must be capable of not only providing the total amount of water used, but also supplying water at maximum rates of demand. Since all customers do not exert their maximum demand for water at the same time, capacities of water facilities are designed to meet the peak coincidental demands that all classes of customers, as a whole, place on the system. For every water service facility on the system, there is an underlying average demand, or uniform rate of usage exerted by the customers for which the base cost component applies. For those facilities designed solely to meet average day demand, costs are allocated 100% to the base cost component. Extra capacity requirements associated with coincidental demands in excess of average use are further related to maximum daily and maximum hourly demands. Analysis of historical system maximum day and maximum hour demands to average day demands results in appropriate ratios for the allocation of capital costs and operating expenses to base and extra capacity cost components. A maximum day to average day ratio of 2.10 is used based on experienced demands in the water system. This indicates that approximately 47.6% of the capacity of facilities designed and operated to meet maximum day demand is required for average or base use. According, the remaining 52.4% is required for maximum day extra capacity requirements. BLACK & VEATCH I Water Utility 4-10 Page 263 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The costs associated with facilities required to meet maximum hour demand are allocable to base, maximum day extra capacity, and maximum hour extra capacity. A ratio of maximum hour to annual average day water use of 2.73 is used, based on demands experienced by the system. This ratio indicates that 36.6% of the capacity of facilities designed and operated for maximum hour demand is needed for average or base use, while 40.3% is utilized for maximum day extra capacity uses, and the remaining 23.1% is required to meet maximum hour extra capacity demand in excess of maximum day needs. 4.5.3.2 Allocation of Net Water Plant Investment The estimated test year net plant investment in water facilities consists of net plant in service as of December 31, 2019, the 2020 construction work in progress, and the estimated cost of proposed capital improvements expected to be in service by the end of calendar year 2022. As the wholesale customers have their own storage tanks, the plant investment associated with tanks was allocated to the retail customers only. The total estimated OCLD of the water system is $104 million, as presented in Line 9 in Table W - 12 in Appendix 1. Plant investment is allocated to cost components on a design basis recognizing the principal function governing the design of the facility. The allocation of net plant investment provides the basis for allocation of depreciation expense. 4.5.3.3 Allocation of Water Facilities Depreciation Expense Depreciation is a real part of the cost of operating a utility. In utility accounting, it is generally accepted practice to use depreciation funds to finance system replacements, improvements, and extensions. While such action does not restore the value lost in each property unit every year, the total value lost through depreciation is restored to the system as a whole. Depreciation funds can be reinvested in the system either by direct payment of routine capital additions and replacements or by principal payments on bonded debt. The total estimated depreciation cost (excluding depreciation on contributed facilities) for the water system is $2.8 million, as presented on Line 9 in Table W - 13 in Appendix 1. As the wholesale customer have their own storage tanks, the depreciation costs associated with tanks was allocated to the retail customers only. 4.5.3.4 Allocation of Water Utility Operating Expenses Table W - 14 in Appendix 1 presents the allocation of O&M expense to functional cost components. Total test year O&M expense, as shown on Line 7 of this table, amounts to $18.2 million. Operating expenses are allocated to functional cost components in generally the same manner as plant investment. 4.5.4 Distribution of Water Utility Costs to Customer Classes As a basis for determining the cost of water service to each customer class, the elements of cost of service previously allocated to functional cost components are distributed among the classes in proportion to their respective service requirements. Estimates of these requirements, or units of service, reflect the average number of accounts with recognition to relative meter sizes serving each account, annual water sales, and estimated peak water demands placed on the system by each customer class. Analysis of resulting costs of service to each class and comparison of allocated costs with revenues under existing rates provide a basis for future water rate adjustments. BLACK & VEATCH I Water Utility 4-11 Page 264 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 4.5.4.1 Water Customer Classification Customer classes consist of residential, non-residential, industrial, irrigation, wholesale, and public and private fire protection. The residential class includes single family residential, duplex, fourplex, apartment, multi -unit residential, and rooming house customers. The non-residential class includes commercial, combination, construction, government, and non-profit classes. Industrial includes major and minor industrial. Outside City includes Farmington, Greenland, Washington/Growth Area, Johnson, and Goshen/ White River. Wholesale includes the communities of Elkins, West Fork, Mt. Olive, and RDA/WWA. These classes group together customers with similar service requirement characteristics and provide a means for allocating costs to customers. 4.5.4.2 Water Units of Service The cost of service responsibility for base costs varies with the annual volume of water usage and is distributed to customer classes on that basis. Extra capacity costs are those costs associated with meeting peak rates of water use and are distributed to customer classes on the basis of their respective system capacity requirements in excess of average requirement rates. Customer costs, which consist of meter related costs, billing, collection and accounting costs, are allocated on the basis of the number of equivalent meters and monthly bills. The estimated units of service for the various customer classifications are presented in Table W - 15 in Appendix 1. Estimates of test year annual water volumes, shown in Column 1, are based on the projections of total water sales for the test year 2023. Average daily water use is presented in Column 2. Columns 3 through 8 present the estimated maximum day and maximum hour capacity factors for each customer class, the resulting demands, and extra capacity requirements, respectively. Customer related meter and service costs are allocated on the basis of the number of equivalent 3/4 inch meters serving each customer class. The number of equivalent meters in each customer class (Column 10) is estimated by relating typical costs for meters and services larger than 5/8 inch in size to the typical cost of a 3/4 inch meter and its related service line. Customer billing and accounting costs are distributed to classes on the basis of the number of bills for each customer class in Column 11. Extra capacity requirements for fire protection service recognize, in part, peak fire flow requirements, and system capabilities established by the Insurance Service Office. One fire is estimated with peak fire flow requirements of 9,000 gallons per minute for 10 hours (maximum day) and 24 hours (maximum hour). Direct fire protection costs have been allocated between inside City and outside City customers in proportion to the number of equivalent 6-inch fire hydrants, as shown in Columns 12 and 13. 4.5.4.3 Water Utility Customer Class Costs of Service Unit costs of service are developed by dividing the total cost allocated to each functional cost component by the total applicable units of service. The customer class responsibility for service is obtained by applying unit costs of service to the number of units for which the customer class is responsible. The water utility has been built with provision for service to customers outside the City, yet the inside City customers must bear the responsibility for providing system facilities by undertaking the necessary investment. Revenues derived from outside City service should provide a margin of return on capital adequate to induce the citizens of Fayetteville to bear the risks of providing outside City service. To recognize the proprietary interest and responsibility of inside City customers in the system, it is proper to charge outside City customers, in addition to their share of operating expense and depreciation, a BLACK & VEATCH I Water Utility 4-12 Page 265 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study reasonable return on their allocated portion of value. A 7.0% (4.0% for future debt service plus 3.0% risk component) annual rate of return on the value of water facilities serving outside City customers is recognized for purposes of this study. Table W - 16 in Appendix 1 shows the development of the unit costs of service applicable to each cost function. Lines 1 through 3 summarize the units of service developed in Table W - 15. Total allocated costs or investment shown on Lines 4, 6, and 8 were previously developed in Table W - 12, Table W - 13 and Table W -14 respectively. Unit costs of service for each component are determined by dividing the allocated cost or investment by the total units of service. Total allocated unit costs of service for inside and outside City customers (Lines 15 and 16) are determined by adding the unit costs for net operating expense (Line 5) and depreciation expense (Line 7) to the respective inside and outside City unit costs for return on investment (Lines 10 and 11). These unit costs applied to the respective units of service shown on Lines 1 and 2 determine the allocated total costs of service for inside and outside City customers shown on Lines 17 and 18. In order to determine the allocated costs for each customer class, the costs are allocated to the various customer classes by applying the appropriate unit cost of service to the respective service requirements of each customer class. Table W - 17 in Appendix 1 shows the resulting allocated and adjusted cost of service by customer class, revenue under existing rates, and the additional revenue required from each class. Costs associated with public fire protection are not recovered through direct charges, therefore, the cost of service for this class is reallocated to all other retail customers in proportion to their allocated cost of service as shown in Column 3. The test year adjusted cost of service, reflecting the reallocation of these costs, is shown in Column 4. The indicated increase or decrease in revenue required to meet adjusted cost of service is shown in Column 6. BLACK & VEATCH I Water Utility 4-13 Page 266 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 5.0 Water Rate Design The principal consideration in establishing water rate schedules is to establish rates to customers to recover costs that reasonably commensurate with the cost of providing water service. Theoretically, the only method of assessing entirely equitable rates for water service would be the determination of each customer's bill based upon each customer's particular service requirements. Since this is impractical, schedules of rates are normally designed to meet average conditions for groups of customers having similar service requirements. Rates should provide for equitable cost recovery, ease of customer understanding and be simple to administer. The revenue requirements and cost of service allocations described in the preceding sections provide the basis for adjusting water rates. The revenue requirements reflect the need for adjustment and the level of revenue required. The cost of service analysis provides the unit costs of service used in the rate design process and gives a basis for determining whether resultant rates will develop revenues which recover costs of service from customer classes in proportion to service required and provide the total level of revenue required. 5.1 Existing Water Rates The existing schedule of rates for water service became effective on January 1, 2022. For both retail and wholesale customers, these rates include a monthly base charge bill, which varies by meter size. The volume charge varies by customer class. The existing water rate structure is described in Section 3.3.1. The existing schedule of base and volumetric water rates is shown in Table W - 3. 5.2 Proposed Water Rates The cost of service analysis described in the preceding sections of this report provides a basis for the design of a schedule of water rates to meet those costs. Proposed water base charge and volume rates have been designed to meet the test year allocated costs of service and are presented in Table W - 18. The proposed rate structure eliminates the minimum volume charge associated with 1,000 gallons. Additionally, volumetric rate structure for non-residential and irrigation customers classes both inside and outside city were changed from declining block rates to uniform block rates Figure 5 - 1 below presents the proposed water rate structure. Figure 5 - 1 Proposed Water Rate Structure • Base Charge by Meter Size Volume Rate (3-Tier Inclining Block) Volume Rate (Uniform) Retail Inside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Retail Outside City (Residential, Non -Residential, Major Industrial, Irrigation, Fire Protection); Wholesale Retail Inside City Residential; and Retail Outside City Residential Retail Inside City Non -Residential, Major Industrial, Irrigation; and BLACK & VEATCH I Water Rate Design 5-14 Page 267 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Retail Outside City Non -Residential, Irrigation Volume Rate ( Uniform) Wholesale Safe Drinking Water Fee (per month) All customer classes In developing proposed schedules of water rates, it must be recognized that the cost of service studies are the result of engineering estimates, based to some extent upon judgment and experience, and detailed results should not be used as literal and exact answers but as guides for potential rate adjustments. Practical considerations such as previous rate levels, bill impact on customers, and magnitude of cost of service shifts among customer classes, and past local practices are commonly recognized in making rate adjustments. A comparison of estimated test year revenue under the proposed rates with allocated costs of service for each of the customer classes is presented in Table W -19 in Appendix 1. This comparison indicates the proposed rates will recover revenues from inside and outside City customer groups reasonably commensurate with the cost of service and practical considerations previously noted. To better reflect the total effect the proposed rates have on customer bills, a comparison of typical inside city and outside city customer water charges under existing rates and the rates proposed to become effective January 1, 2023, is presented in Table W - 20. BLACK & VEATCH I Water Rate Design 5-15 Page 268 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 6.0 Wastewater Utility The financial plan and rate design were developed to meet all the funding obligations of the wastewater utility, and to achieve the financial adequacy and equitable cost recovery discussed in Section 2.3. The wastewater utility financial plan was developed for the forecast period of 2021 through 2026, and includes the following key components: Revenue projections (user rate revenues and non -rate revenues); Capital improvement program; Annual revenue requirement projections; and Annual proposed revenue increases 6.1 Wastewater Revenue Projections Under Existing Rates The wastewater utility revenues are derived from the following sources: Wastewater Service Revenues (Base and Volume Charge) Other Revenues As a first step in the development of the financial plan, Wastewater Service Revenues under the 2021 existing rates are projected for the forecast period. 6.1.1 Wastewater Revenue Under Existing Rates As described in Section 3.3.2, the Wastewater Service Revenue consists of two charge components. For each of the two components, revenues are projected based on billing units and applicable existing rate schedules. The billing units necessary to compute the Base Charge revenues are the number of accounts based on meter size and customer class. The billing units necessary to compute the Volume Charge are the annual wastewater billed volumes by customer class and by applicable blocks of billable wastewater volume. 6.1.1.1 Projection of Customer Accounts Typically, historical billing units are reviewed and used to project billing units for the forecast period. The project team reviewed historical accounts and billed volume trends for each customer class referenced in Section 3.3.1. Based on the review of historical trends, two annual adjustment factors were applied to project billing units for the forecast period. The two adjustment factors applied at the customer class level are accounts growth rate and volume factor. The number of accounts is projected to grow for residential customer classes Fayetteville (Inside City) and Farmington (Outside City), whereas all other customer classes are anticipated to remain at the 2020 level. The total number of wastewater accounts is anticipated to increase from about 40,100 in 2021 to about 43,300 in 2026, at an overall annual system growth rate of 1.6%. Table S - 1 in Appendix 2 presents the projected annual number of accounts for the period of 2021 through 2026. BLACK & VEATCH I Wastewater Utility 6-1 Page 269 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Figure 6-1 presents both the historical and projected number of accounts for the wastewater utility. Waterwater Utility Historical and Projected Accounts 46,000 44,000 r 42,000 r r r r r r r 40,000 38,000 36,000 34,000 32,000 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-1 - Historical and Projected Wastewater Accounts 6.1.1.2 Projection of Wastewater Volume Billed wastewater volumes are projected based on estimates of the number of wastewater accounts and the average billed volume per account. Average billed volume per account is determined based on historical billed volume. The historical billed volume per account for all customer classes varies each year between 2016 and 2020. In 2020, the COVID pandemic led to stay-at-home measures and shut down of non -essential businesses across the country. Consequently, the residential customers used more water in 2020, whereas the non-residential customers used less water as compared to previous years. The average billed volume per account for 2021 was projected to remain at the 2020 levels assuming a lingering effect of the pandemic. The average billed volume per account for 2022 and beyond was projected to return to the 2019 level for all customer classes assuming a return to pre - pandemic levels. Total system wastewater billed volume is projected to increase from 3,043,100 kgals in 2021 to 3,205,800 kgals in 2026. Table S - 2 in Appendix 2 presents the historical and projected annual volume for the period of 2020 through 2026. Figure 6-2 presents both the historical and projected annual billed volume for the wastewater utility. BLACK & VEATCH I Wastewater Utility 6-2 Page 270 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Wastewater Utility Historical and Projected Billed Volume (1,000Gallons) 3,500,000 3,000,000 — — — — — — — 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-2 - Historical and Projected Wastewater Billed Volume 6.1.2 Projection of Service Revenue Under Existing Rates Wastewater service revenues for the period 2021 through 2026 are projected for each charge component (base and volume) based on the projections of accounts by meter size, projected billed volume for each customer class, and the application of the 2021 rate schedule for 2021 revenues and 2022 rate schedule for 2022 through 2026. Wastewater service revenue under existing rates is projected to increase slightly from $24.5 million in 2021 to $26.7 million in 2026. This growth is due to increase in wastewater sales due to the growth in the number of accounts over the study period. Table S - 4 in Appendix 2 presents the historical and projected annual service revenues for the period of 2021 through 2026. Figure 6-3 presents both the historical and projected annual service requirements under existing rates for the wastewater utility. Wastewater Utility Historical and Projected Service Revenues (Under Existing Rates) $30,000,000 525,000,000 — — — — — — — $20,000,000 S 15,000,000 510,000,000 55,000,000 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Historical — — Projected Figure 6-3 - Historical and Projected Wastewater Service Revenue 6.1.3 Other Wastewater Revenue The other revenues include the following major components: BLACK & VEATCH I Wastewater Utility 6-3 Page 271 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Impact Fee Revenue; Wastewater Connection Fees; Wastewater Sales Not on Computer Penalties; and WWTP Fees (Hay Sales, Biosolids/ Fertilizer Sales & Water Treatment Residual) The annual revenues from wastewater impact fees, wastewater connection fees. wastewater sales not on computer, and WWTP Fees for 2021 to 2026 are projected based on historical three-year (2018 to 2020) average revenues for each of the fees. The penalties revenue in 2020 reflects only the first two and half months of revenues, as the City stopped assessing penalties for non-payment due to the pandemic. The revenue for penalties in 2021 is projected to be half of the historical three -year (2017 to 2019) average revenues due to continued waiver of the penalties as a result of the COVID pandemic during the first half for 2021. The revenue from penalties in 2022 and beyond is projected as the historical three-year average (2017 to 2019) average revenues. Table S - 5 in Appendix 2 presents the historical and projected annual other revenues for the period of 2020 through 2026. 6.2 Wastewater Capital Improvements Program The capital project costs provided by the City were based on 2020 dollars. Based on discussions with the City, the project costs are inflated at an annual rate of 3.0% to accurately reflect the costs of projects for 2021 and beyond. The City's wastewater utility Capital Improvement Plan (CIP) provides for a total of $69.3 million of investments during the study period of 2021 through 2026. Major wastewater projects include sanitary wastewater rehabilitation totaling $15.7 million and Biosolids Dryer Replacement totaling $31.1 million. Table S - 6 in Appendix 2 presents the CIP list of projects for 2021 through 2026. The CIP is expected to be financed from a funding mix of cash financing from service revenue and impact fees. 6.3 Wastewater Utility Revenue Requirements Projection of reliable revenue requirements includes: (1) O&M expenses; (2) bad debt; (3) Payment In Lieu of Taxes; (4) debt service (consisting of principal and interest payments); (5) transfer to shop fund; (6) transfer to operating reserve; (7) cash financed capital; and (8) transfer to capital reserve. The projections of annual revenue requirements for the study period is discussed in this section. 6.3.1 Wastewater Operation and Maintenance Expenses The O&M expenses for the wastewater utility include the annual expenses associated with the wastewater conveyance, pumping, treatment and disposal; meters and services; billing and collection, and general administrative services. These expenses include personnel costs (salaries and benefits), costs for materials and supplies, costs of utilities, and contracted services. The 2021 O&M budget provided by the City was used as the baseline for projection of O&M expenses for the study period. In addition, costs associated with a wastewater inspector (not included in the 2021 budget) recurring salary and benefits costs, recurring vehicle maintenance costs and one-time cost of the vehicle purchase was added per City's direction. Based on historical O&M costs, industry experience, and discussions with the City management, appropriate escalation factors were applied to various BLACK & VEATCH I Wastewater Utility 6-4 Page 272 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study categories of costs to project future annual O&M expenses. Annual escalation factors used for major cost categories include the following: Salaries: 4.00% Benefits: 5.00% Energy: 3.00% Chemicals: 3.00% Wastewater Treatment Plant Contract: 3.00% The annual O&M expenses for wastewater utility are budgeted at $15.7 million in 2021 and are projected to grow to $18.4 million by 2026. Table S - 7 in Appendix 2 presents a summary of projected operation and maintenance expense for the period 2021 through 2026. Figure 6-4 presents the historical and projected O&M expenses for the wastewater utility. S2o,000,o00 S15,000,00o S10,000,00o $5,000,000 Wastewater Utility Historical and Projected O&M Expenses 2020 2021 2022 2023 2024 2025 202b Historical — — Projected Figure 6-4 - Projected Annual Wastewater O&M Expense 6.3.2 Wastewater Bad Debt Bad debt expenses refer to outstanding balances owed that are deemed uncollectible. The wastewater bad debt in 2019 was 0.5% of revenue. Hence, the bad debt projections for the study period assume 0.5% of annual revenues. Annual bad debt expenses for wastewater utility is projected to increase from $122,300 in 2021 to $145,500 by 2026 reflecting the increase in projected revenues. Line 16 in Table S - 9 in Appendix 2 presents bad debt expense for the period 2021 through 2026. 6.3.3 Wastewater Payment In Lieu of Taxes The PILOT costs are paid by public utilities to municipal entity as a compensation for utilization of streets, easements, right of ways or other public places. The PILOT amount is determined per City Ordinance 4449 that requires that the water and wastewater funds to pay 4.25% of annual total gross sale revenues to the City. Annual PILOT amount for the wastewater utility is calculated by multiplying actual wastewater revenues from prior year (Wastewater sales on Computer and Wastewater sales not BLACK & VEATCH I Wastewater Utility 6-5 Page 273 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study on Computer/ Dump Fees) and is projected to increase from $1,039,600 in 2021 to $1,236,900 in 2026. Line 17 in in Appendix 2 presents PILOT expense for the period 2021 through 2026. 6.3.4 Wastewater Debt Service Requirements The wastewater utility does not have any outstanding debt service obligations. The City does not anticipate any debt issuances during the study period, therefore no projected debt service for future debt as shown in Line 18 in Table S - 9 in Appendix 2. 6.3.5 Transfer to Shop Fund The transfer to the shop fund is made by the utility whenever a new vehicle (associated with new personnel) is purchased, thereby expanding the existing fleet. There are no projected transfers to the shop fund over the study period as shown in Line 20 in Table S - 9 in Appendix 2 6.3.6 Transfer to Operating Reserve The City maintains an operating reserve balance equivalent of ninety (90) days of following years' O&M budget. The transfer to operating reserve is projected to increase from $12,7100 in 2022 to $145,500 in 2026 reflecting the growth in the O&M budget. Line 21 in Table S - 9 in Appendix 2 presents transfer to the operating reserve for the period 2021 through 2026. 6.3.7 Wastewater Cash Financed Capital The City currently utilizes the following two sources of funding for the wastewater utility capital projects (1): transfer from operating revenues and (2) transfer from the impact fee fund. As stated in Section 6.2, the wastewater capital improvement program for the study period is $69 million, of which $67 million is projected to be funded from operating revenues and $2 million is from the impact fee fund. A capital project meets the requirements of using impact fees if the existing wastewater capacity is expanded due to growth. The construction contract and the budget amendment to change the source of funding to impact fee must be approved by the City Council. Table S - 8 in Appendix 2 presents the sources of funding for the wastewater capital improvement program. Line 22 in Table S - 9 in Appendix 2 presents transfer for cash financing of capital program for the period 2021 through 2026. 6.3.8 Transfer to Capital Reserve The wastewater utility, after meeting all the obligations stated in sections above, transfers the excess funds to the capital reserve fund. The capital reserve fund is used as a source for funding the capital program in the years that the revenues are not sufficient to meet the capital funding requirements. Line 23 in Table S - 9 in Appendix 2 presents transfer to and from the capital reserve for the period 2021 through 2026. 6.4 Wastewater Proposed Revenue Adjustments The annual revenue adjustments that are needed to achieve the defined financial performance objectives are determined by evaluating the funding gap between the projected annual revenue requirements and the projected revenues under existing rates. Table S - 9 in Appendix 2 provides a summary of the revenue and revenue requirements (financial plan) for the study period. Projected Revenue Under Existing Rates: Line 1 indicates that under existing rates (2022 rates) wastewater utility revenues will increase from $25.4 million in 2022 to $26.7 million in 2026. BLACK & VEATCH I Wastewater Utility 6-6 Page 274 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Projected Other Revenues: Line 8 indicates that the other revenues and interest income are anticipated to increase from $720,500 in 2022 to $727,000 in 2026. It is anticipated that all categories of other revenues will remain flat throughout the study period. The slight growth is due to the increase in interest income on the operating reserve. Projected Expenses: Line 14 indicates the total annual expenses for the wastewater utility are anticipated to increase from $17.4 million in 2022 to $19.8 million in 2026. Projected Transfers: Line 19 indicates the total annual transfers for the wastewater utility are anticipated to increase from $8.8 million in 2022 to $10.1 million in 2026. Funding Gap: The cash flow analysis indicates that the sum of revenues under existing rates and the other revenues is not adequate to fund the projected annual revenue requirements, thereby causing an operating deficit. Proposed Revenue Adjustments: To address the funding gap in the wastewater utility, a series of revenue adjustments are proposed as follows: 2024: 3% effective (January 1, 2024) 2025: 3% effective (January 1, 2025) 2026: 3% effective (January 1, 2026) Lines 2 through 7 in Table S - 9 present the amount of additional revenues generated each year with the proposed magnitude and timing of revenue adjustments. Figure 6-5 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Wastewater Utility Revenues and Revenue Requirements $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 2021 2022 2023 2024 2025 2026 O&M Expenses Cash Financing of Capital Other Transfers Revenues Under Existing Rates Revenues Under Proposed Rates Figure 6-5 - Wastewater Revenues and Revenue Requirements BLACK & VEATCH I Wastewater Utility 6-7 Page 275 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 10 in Appendix 2 presents the wastewater utility's operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: ■ O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. ■ Operating Fund Balance: A minimum target of $100,000. ■ Capital Fund Balance: A minimum target of $500,000. ■ Capital Reserve Fund Balance: An amount necessary to fully fund anticipate capital projects. As shown in Table S - 9, the proposed annual revenue adjustments will allow the water utility to meet the minimum fund balance requirements for all funds through 2026. 6.5 Wastewater Cost of Service A key step to developing an equitable rate structure involves the cost of service analysis. The financial plan discussed in sub sections 6.1 through 6.4 provides an estimate of the total annual revenue requirements for a given fiscal year. The test year for which the cost of service study was performed is 2023. The key components of the cost of service analysis are: Determination of Cost of Service (net revenue requirements); Determination of Functional Costs; Allocation of Functional Costs to Cost Components; and Distribution of Wastewater Utility Costs to Customer Classes 6.5.1 Determination of Cost of Service The first step is to determine the cost of service that is to be recovered from user rates and charges. As briefly discussed in Section 2.3, cost of service is defined as, and synonymous with, the "net revenue requirement" that is to be recovered for the test year through user rates and charges. Table S - 11 in Appendix 2 presents the derivation of the cost of service to be recovered through the wastewater charges. As Line 18 in Table S - 11 indicated, wastewater cost of service for 2023 is projected to be $25.7 million. This cost of service consists of $17.3 million of net operation and maintenance expense and $8.4 million of net capital costs. As performed for the water utility, costs of services are apportioned among customer classes in this study on a Utility Basis. The depreciation expense and return on system investments that were already explained in Section 4.5.1 are applicable to the wastewater utility cost of service analysis as well. The depreciation expense associated with the wastewater utility is estimated in this study recognizing depreciation rates presently in use by the wastewater utility. This results in a projected test year depreciation expense of $8.3 million BLACK & VEATCH I Wastewater Utility Page 276 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study exclusive of depreciation on contributed plant, which is not recognized for cost allocation or rate design purposes. The contributed plant adjustment is consistent with generally accepted regulatory practices. Total return for the test year is projected to be $132,600 as shown on Line 17 of Table S - 11. 6.5.2 Determination of Functional Costs As a basis for developing an equitable rate structure, the test year cost of service should be allocated to the various customer classes according to respective service requirements. The basic underlying principle in developing cost of service rates is the determination of what elements in a wastewater system are responsible for causing the level of revenue requirements that is needed. To allocate the costs to customer classes, first the operating and capital costs of service are aggregated into "Functional Cost Centers." The functional costs are then further allocated to cost components. Each component cost is then apportioned to customer classes. Functional Cost Centers Functional cost centers of a wastewater utility represent the activities that contribute to the incurrence of O&M and capital costs. For a wastewater utility, they often include source of collection, pumping, conveyance, treatment, disposal, meters, billing, and other administration costs. Both the O&M and capital costs defined for the Test Year, discussed in 6.5.1, need to be allocated to functional cost centers. Functional Costs The capital costs associated with the functional cost centers are determined using detailed fixed assets data, provided by the City, for each class of asset that is currently in service, construction work in progress and projected capital improvement program for the test year. The total value of the fixed assets (referred to as "Net Plant Investment") in the system is usually presented as Original Cost Less Depreciation ("OCLD"). The total estimated OCLD value of the wastewater system is $200.0 million, as presented in Line 26 in Table S - 12 in Appendix 2. This plant investment is subsequently used as a basis for the allocation to cost components, discussed in the following subsection 6.5.3.2. The O&M costs for the Test Year are allocated to the various functional cost centers based on specific nature of costs. The allocation of the projected O&M cost of service (net operating revenue requirement) of $17.3 million, to the various functional cost centers is presented in Table S - 14 in Appendix 2. The various cost elements of wastewater service are assigned to functional cost components as the first step in the subsequent distribution of the costs of service to customer classes. 6.5.3 Allocation of Costs to the Functional Cost Components The principal functional cost components consist of volume related costs, strength related costs, and customer related costs. Volume costs are those which vary directly with the quantity of wastewater contributed. They consist of capital costs related to investment in system facilities which are sized on the basis of, or required BLACK & VEATCH I Wastewater Utility 6-9 Page 277 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study because of, wastewater volume. This also includes operation and maintenance expense related to those facilities, and the expense of volume related treatment chemicals and purchased power. Wastewater strength costs consist of the operation and maintenance expense and capital costs related to system facilities which are designed principally to treat the wastewater pollutant loadings of pollutants such as BOD, TSS, and other pollutants. BOD costs reflect costs associated with the treatment of influent BOD and include costs related to activated sludge aeration and disposal of BOD related sludge. Suspended solids strength costs are those costs of wastewater treatment which tend to vary according to the quantity of suspended solids in the raw wastewater. Customer costs are those which tend to vary in proportion to the number of customer bills or customers served. These include the wastewater utility share of customer related meter reading, billing, collection, and account expense. The delineation of costs of service into functional components provides a means of distributing such costs to the various customer classes based on the respective total wastewater volume, strength, and customer cost requirements of each. Wholesale customers generally do not use lateral wastewater lines as do retail users. Therefore, separate functional cost of service categories are designated for costs which are common to all customer classes and those which are common to retail service classes only. 6.5.3.1 Wastewater Utility Cost Allocation to Cost Components In establishing the costs associated with each functional cost component, the return portion of the test year cost of service is distributed to cost functions based on an allocation of the estimated test year value of wastewater system facilities. The test year depreciation expense associated with each major element of plant facilities is allocated to cost functions in the same manner as the plant value. Operating expense is similarly allocated to cost functions based on the projected test year expense estimated for each wastewater system component. 6.5.3.2 Allocation of Net Wastewater Plant Investment The estimated test year value of wastewater facilities consists of net plan in service as of December 31, 2019, the 2020 construction work in progress, and the estimated cost of proposed capital improvements expected to be in service by the end of calendar year 2022. Table S - 12 in Appendix 2 presents the allocation of the wastewater utility's total estimated plant value less contributions on an original cost less depreciation value basis. Total plant investment is estimated to be $200.0 million as indicated by Line 26 of the Table S - 12. Plant investment is allocated to cost components on a design basis recognizing the principal purpose governing the design of the facility. The allocation of net plant investment provides the basis for allocation of depreciation expense. The Owl Creek Lift Station and Force Main serve only the City of Fayetteville, hence the plant investment associated with Owl Creek is allocated directly to the City of Fayetteville customers. Additionally, the outside City customers maintain their own wastewater connections, hence, the plant investment associated with wastewater connections is allocated 100% to the City of Fayetteville customers. BLACK & VEATCH I Wastewater Utility 6-10 Page 278 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The City has a contract with the City of Farmington stipulating that Farmington will be allocated 8.2% of the costs associated with the West Treatment Plant. Hence, 8.2% of the West Treatment Plant's investment is allocated directly to the City of Farmington customers. Wastewater collection net plant is allocated 41% to both retail and wholesale (common to all) and 59% to retail only based on the ratio of interceptors (large diameter mains) which is 41% of the collection system. 6.5.3.3 Allocation of Wastewater Facilities Depreciation Expense As explained in Section 4.5.3.3, depreciation expense is a real part of the cost of operating a utility. The total estimated depreciation cost (excluding depreciation on contributed facilities) for the wastewater system is $8,259,600 as presented on Line 26 in Table S - 13 in Appendix 2. The items of expense are allocated to cost components on the same design or cost causative basis used to allocate plant investment. Hence, the depreciation expense associated with Owl Creek Lift Station and Force main and Wastewater connections is directly allocated to the City of Fayetteville customers and 8.2% of the West Treatment Plant's depreciation is allocated directly to the City of Farmington customers. 6.5.3.4 Allocation of Wastewater Utility Operating Expenses Table S - 14 in Appendix 2 presents the allocation of operation and maintenance expense to functional cost components. Total test year operation and maintenance expense, as shown on Line 10 of this table, amounts to $18.1 million. Operating expenses are allocated to functional cost components in generally the same manner as plant investment. 6.5.4 Distribution of Wastewater Utility Costs to Customer Classes The total cost responsibility of each customer class is determined by developing unit costs of service for each cost component and applying the unit costs to the respective service requirements of each class. In accomplishing this, each customer class is allocated the share of volume, strength, and customer costs for which it is responsible. 6.5.4.1 Wastewater Customer Classification Customer classes consist of residential, non-residential, industrial and wholesale. The residential class includes single family residential, duplex, fourplex, apartment, multi -unit residential and rooming house customers. The non-residential class includes commercial, combination, construction, government, and non-profit customers. Outside City includes Farmington, Greenland, Washington County/Growth Area and Johnson. Wholesale includes the community of Elkins and West Fork. 6.5.4.2 Wastewater Units of Service Derivation of the responsibility of customer classes for costs of service require that each class be allocated a portion of the volume, strength, and customer costs of service according to their respective service requirements. The cost of service responsibility for volume costs, which vary with the volume of wastewater contributed to the wastewater system, is distributed to customer classes on that basis. Strength costs are principally related to the function of reducing wastewater suspended solids, and BOD strength loading. Customer costs, which consist of meter related costs, billing, collection and accounting costs, are allocated on the basis of equivalent meters and monthly bills. BLACK & VEATCH I Wastewater Utility 6-11 Page 279 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study The estimated test year service requirements or units of service for the various customer classes are shown in Table S -15 in Appendix 2. Wastewater collected and treated consists of two elements: (1) sanitary wastewater flow and (2) infiltration/inflow (1/1) of ground water into the sewers. Contributed wastewater flow is that portion of the annual water use and/or other flows from each customer class that are discharged to the wastewater system. Estimates of the contributed volume of each class is generally based upon wastewater billing records. For residential customers, the billed wastewater volume is based on average water consumption for the preceding months of December, January and February. This methodology of using a winter quarter average for quantity of wastewater flows is used to exclude outdoor uses such as irrigation, which do not return water to the collection system. For all other customer classes, the billed wastewater volume is the same as the water volume. The difference between the measured plant influent and the customer contributed wastewater flow is attributed to Infiltration and Inflow (1/1) volume. Based on discussions with the City staff, 40% of the total treated volume is assumed to be 1/1 flows. Each customer class should bear its proportionate share of the costs associated with 1/1, as it is integral aspect of wastewater system costs. The number of customer connections to a wastewater collection system and the volume of customer flows conveyed both influence the extent of 1/1 in a system. Recognizing that the major cost responsibility for 1/1 is allocable on an individual connection basis, two-thirds of the total 1/1 volume projected is allocated to customer classes based on the number of customers with the remaining one-third allocated on the basis of contributed volume. Estimated total strength units shown for each customer class are based on an average BOD concentration of 365 milligrams per liter (mg/1) and an average suspended solids concentration of 285 mg/I. 1/1 strength allowances for BOD and suspended solids are assumed at 25 mg/I and 50 mg/I, respectively. Estimated BOD and suspended solids responsibilities of each customer class presented in Table S - 15 in Appendix 2 are based on the respective indicated average strength concentrations and contributed wastewater and 1/1 volumes for each class. Customer billing and accounting costs are distributed to classes on the basis of the number of bills for each customer class (Column 7) in Table S - 15. Customer related meter and service costs are allocated on the basis of the number of equivalent 3/4 inch meters serving each customer class. The number of equivalent meters in each customer class (Column 8) is estimated by relating typical costs for meters and services larger than 3/4 inch in size to the typical cost of a 3/4 inch meter. 6.5.5 Wastewater Utility Customer Class Costs of Service Unit costs of service are developed by dividing the total cost allocated to each functional cost component by the total applicable units of service. The customer class responsibility for service is obtained by applying unit costs of service to the number of units for which the customer class is responsible. The wastewater utility has been built with the provision for service to customers outside the City, yet the inside City customers must bear the responsibility of providing system facilities by undertaking the necessary investment. Revenues derived from outside City service should provide a margin of return on capital adequate to induce the citizens of Fayetteville to bear the risks of providing outside City service. To recognize the proprietary interest and responsibility of inside City customers in the system, it is proper to charge outside City customers, in addition to their share of operating expense and depreciation, a reasonable return on their allocated portion of value. A 7.0% (4.0 % for future debt BLACK & VEATCH I Wastewater Utility 6-12 Page 280 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study service plus 3.0% risk component) annual rate of return on the value of wastewater facilities serving outside City customers is recognized for purposes of this study. Table S - 16 in Appendix 2 shows the development of the unit costs of service applicable to each cost function. Lines 1 through 3 summarize the units of service developed in Table S - 15. Total allocated costs or investment shown on Lines 5, 7, and 9 were previously developed in Table S - 14, Table S - 13 and Table S - 12, respectively. Total allocated unit costs of service for inside City and outside City customers (Line 18, Line 19, Line 20 and Line 21) are determined by adding the unit costs for net operating expense (Line 6) and depreciation expense (Line 8) to the respective inside and outside City unit costs for return on investment (Lines 11 and 12). These unit costs applied to the respective units of service shown on Lines 1,2 and 3 determine the allocated total costs of service for inside and outside City customers shown on Lines 18 through 21. In order to determine the allocated costs for each customer class, the costs are allocated to the various customer classes by applying the appropriate unit cost of service to the respective service requirements of each customer class. Table S - 17 in Appendix 2 shows the resulting allocated cost of service by customer class, revenue under existing rates, and the indicated increase or decrease in revenue required to meet the allocated cost of service. BLACK & VEATCH I Wastewater Utility 6-13 Page 281 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 7.0 Wastewater Rate Design The principal consideration in establishing wastewater rate schedules is to establish charges to recover costs that are reasonably commensurate with the cost of providing wastewater service. The revenue requirements and cost of service allocations described in the preceding sections provide the basis for adjusting wastewater rates. The revenue requirements show the need for adjustment and the level of revenue required. This cost of service analysis provides the unit costs of service to be used in the rate design process and gives a basis for determining whether resultant rates will generate revenues which recover costs of service from customer classes in proportion to service required and provide the total level of revenue required. 7.1 Existing Wastewater Rates The existing schedule of rates for wastewater service became effective on January 1, 2022. For retail customers, these rates include a monthly base charge bill, which varies by meter size. The volume charge varies by customer class. Surcharge rates are based on excess strength of BOD and TSS. The existing wastewater rate structure is described in Section 3.3.2. The existing schedule of base and volume rates for wastewater service is shown in Table S - 3 in Appendix 2. 7.2 Proposed Wastewater Rates The cost of service study described in preceding sections of this report provides a basis for the design of a schedule of wastewater rates to meet those costs. Proposed wastewater rates have been designed to meet the test year allocated costs of service and are presented in Table S - 18. The proposed rate structure presented in Figure 7 - 1 is similar to the existing structure. Figure 7 - 1 Proposed Wastewater Rate Structure • Base Charge by Meter Size • Retail Inside City (Residential, Non -Residential and Major Industrial); Retail Outside City (Residential, Non -Residential and Major Industrial); Volume Rate (2-Tier Inclining Block) Retail Inside City Residential Based on winter water usage of December, January and February • Volume Rate (Uniform) Retail Inside City (Non -Residential and Major Industrial) Retail Outside City (Residential, Non -Residential and Major Industrial) Volume Rate ( Uniform) Wholesale As already explained in Section 5.2, practical rate design should consider multiple factors including previous rate levels, customer bill impact, and magnitude of cost shifts among customer classes. BLACK & VEATCH I Wastewater Rate Design 7-14 Page 282 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study A comparison of estimated test year revenue under the proposed rates with allocated costs of service for each of the customer classes is shown in Table S - 19 in Appendix 2. This comparison indicates the proposed rates will recover revenues from inside and outside City customer groups reasonably commensurate with the cost of service and practical considerations previously noted. To better reflect the total effect the proposed rates have on customer bills, a comparison of typical bills under existing rates and the rates proposed to become effective January 1, 2023, is shown in Table S - 20. 8.0 Combined Water and Wastewater Utilities Table C - 1 in Appendix 3 presents the combined operating reserve, capital reserve and impact fee fund balances. Table C - 2 in Appendix 3 provides a summary of the combined revenue and revenue requirements (financial plan) for the study period. The revenue under existing rates are not sufficient to meet the obligations of the two utilities. As discussed in Section 4 and Section 6, a series of annual 3% proposed revenue adjustments enable the utilities to meet their operating, capital and reserve obligations. Figure 8-1 presents the projected revenue and revenue requirements through 2026 for the wastewater utility. Waterand Wastewater Revenues and Revenue Requirements 570,000,000 S5 0,000,000 550,000,000 S40,000,000 S30,000,000 S20,000,000 S10,000,0o0 $0 2021 2022 2023 2024 2025 O&M Expenses Cash Financing of Capital other Transfers Revenues Under Existing Rates Revenues 11nder Proposed Rates Figure 8-1 - Water and Wastewater Revenues and Revenue Requirements Table C - 2 in Appendix 3 presents the combined water and wastewater operating reserve, capital reserve and impact fee fund balances. The City has identified the minimum balance requirements for each of the following funds: O&M Reserve Balance: A cash balance of at least 90 days of the follow's year operating expenses. Operating Fund Balance: A minimum target of $200,000. BLACK & VEATCH I Combined Water and Wastewater Utilities 8-15 Page 283 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Capital Fund Balance: A minimum target of $1,000,000. Capital Reserve Fund Balance: An amount necessary to fully fund anticipated capital projects. As shown in Table C - 2, the proposed annual revenue adjustments will allow the utilities on a combined basis to meet the minimum fund balance requirements for all funds through 2026. A comparison of combined water and wastewater typical bills under existing rates and the rates proposed to become effective January 1, 2022, is shown in Table C - 3. 9.0 Disclaimer This report was prepared for the City of Fayetteville (Client) by Black & Veatch Management Consulting, LLC (Black & Veatch) and is based on information provided by the Client not within the control of Black & Veatch. While it is believed that the information, data and opinions contained herein will be reliable under the conditions and subject to the limitations set forth in this report, Black & Veatch does not guarantee the accuracy thereof. Black & Veatch has assumed that the information provided by others, both verbal and written, is complete and correct. The projections set forth in this report are intended as "forward -looking statements." In formulating these projections, Black & Veatch has made certain assumptions with respect to conditions, events, and circumstances that may occur in the future. While Black & Veatch believes the assumptions are reasonable actual results may differ materially from those projected, as influenced by the conditions, events, and circumstances that occur. As such, Black & Veatch does not take responsibility for the accuracy of data or projections provided by or prepared on behalf of the Client, nor does Black & Veatch have any responsibility for updating this report for events occurring after the date of this report. Use of this report or any information contained therein by any party other than the Client, shall constitute a waiver and release by such third party of Black & Veatch from and against all claims and liability, including but not limited to liability for special, incidental, indirect or consequential damages in connection with such use. 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BLACK & VEATCH I Disclaimer 9-16 Page 284 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 10.0 Appendix 1: Water Tables Table W - 1 - Water Projected Number of Accounts Line 1 2 Inside City Residential Non -Residential 35,200 3,500 35,800 3,500 Projected 36,400 3,500 37,100 3,500 37,700 3,500 38,400 3,500 73,200 0 3 Industrial 21 21 21 21 21 21 0 4 Irrigation 2,000 2,100 2,100 2,100 2,200 2,200 200 5 Private Fire 713 713 713 713 713 713 0 6 7 Subtotal Outside City Residential 41,434 6,500 42,134 6,600 42,734 6,800 43,434 6,900 44,134 7,100 44,834 7,200 3,400 700 8 Non -Residential 400 400 400 500 500 500 100 9 Industrial 0 0 0 0 0 0 0 10 Irrigation 271 277 285 292 299 307 37 11 Private Fire 14 14 14 14 14 14 0 12 13 Subtotal Wholesale Elkins 7,185 1 7,291 1 7,499 1 7,706 1 7,913 1 8,021 1 837 0 14 Mount Olive 2 2 2 2 2 2 0 15 West Fork 1 1 1 1 1 1 0 16 RDA/WWA 4 4 4 4 4 4 0 17 18 19 Subtotal Total %Change 8 48,627 3.26% 8 49,433 1.66% 8 50,241 1.63% 8 51,148 1.81% 8 52,055 1.77% 8 52,863 1.55% 0 4,237 8.71% BLACK & VEATCH I Appendix 1: Water Tables Page 285 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 2 - Water Projected Billed Volume (1,000 Gallons) Projected 2024Line 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Inside City 1 Residential 1,896,300 1,769,800 1,800,800 1,832,300 1,864,400 1,897,000 700 2 Non -Residential 678,600 827,100 827,100 827,100 827,100 827,100 148,500 3 Industrial 322,300 401,800 401,800 401,800 401,800 401,800 79,500 4 Irrigation 249,600 244,300 248,600 252,900 257,300 261,800 12,200 5 Subtotal 3,146,800 3,243,000 3,278,300 3,314,100 3,350,600 3,387,700 240,900 Outside City 6 Residential 427,900 385,700 394,600 403,800 413,300 423,100 -4,800 7 Non -Residential 51,300 65,600 66,400 67,300 68,300 69,200 17,900 8 Irrigation 28,400 24,400 25,000 25,700 26,400 27,100 -1,300 9 Subtotal 507,600 475,700 486,000 496,800 508,000 519,400 11,800 Wholesale 10 Elkins 81,000 75,000 75,000 75,000 75,000 75,000 -6,000 11 Mount Olive 68,900 62,100 62,100 62,100 62,100 62,100 -6,800 12 West Fork 69,200 65,200 65,200 65,200 65,200 65,200 -4,000 0 13 RDA/WWA 0 0 0 0 0 0 14 Subtotal 219,100 202,300 202,300 202,300 202,300 202,300 -16,800 15 Total 3,873,500 3,921,000 3,966,600 4,013,200 4,060,900 4,109,400 235,900 16 %Change 1.26% 1.23% 1.16% 1.17% 1.19% 1.19% 6.09% BLACK & VEATCH I Appendix 1: Water Tables Page 286 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 3 - Water Existing Rates Existing Water Rates Effective January 1, 2022 Inches $/month $/month $/month $/month $/month 5/8 6.59 7.54 8.31 3/4 6.59 7.54 8.31 1 9.14 10.52 11.49 9.75 11.68 1 1/2 15.93 18.31 20.00 10.17 12.10 2 23.20 26.66 29.07 20.33 23.37 3 54.05 62.18 64.38 30.48 35.06 4 89.50 102.93 112.25 60.97 70.11 6 178.99 205.82 212.76 169.34 197.74 8 268.41 308.67 332.91 355.65 409.00 10 609.68 701.11 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential 0 - 2,000 Gallons 3.51 4.04 2,000 - 15,000 Gallons 4.65 5.35 Over 15,000 Gallons 6.59 7.54 Non -Residential First 300,000 Gallons 3.79 4.38 Over 300,000 Gallons 3.39 3.90 Major Industrial All Usage 2.96 3.40 Irrigation First 300,000 Gallons 5.04 5.80 Over 300,000 Gallons 4.53 5.22 Wholesale Reduced Peak Demand 2.87 Peak Demand 3.20 BLACK & VEATCH I Appendix 1: Water Tables Page 287 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 4 - Water Projected Revenues Under Existing Rates 1 Inside City Residential S 11,196,100 S 11,001,700 S 11,194,200 S 11,390,100 S 11,589,500 S 11,792,300 2 Non -Residential 2,844,700 3,476,000 3,476,000 3,476,000 3,476,000 3,476,000 3 Industrial 933,000 1,196,700 1,196,700 1,196,700 1,196,700 1,196,700 4 Irrigation 1,410,700 1,431,200 1,456,300 1,481,800 1,507,700 1,534,100 5 Private Fire 967,600 967,600 967,600 967,600 967,600 967,600 6 7 Subtotal Outside City Residential 17,352,100 2,743,800 18,073,200 2,614,600 18,290,800 2,674,900 18,512,200 2,737,200 18,737,500 2,801,400 18,966,700 2,867,700 8 Non -Residential 258,700 328,200 333,000 338,000 343,300 348,800 9 Industrial 0 0 0 0 0 0 10 Irrigation 190,000 173,400 177,900 182,500 187,400 192,400 11 Private Fire 27,100 27,100 27,100 27,100 27,100 27,100 12 Subtotal 3,219,600 3,143,300 3,212,900 3,284,800 3,359,200 3,436,000 Wholesale 13 Elkins 226,800 216,200 216,200 216,200 216,200 216,200 14 Mount Olive 193,900 179,800 179,800 179,800 179,800 179,800 15 West Fork 194,000 188,100 188,100 188,100 188,100 188,100 16 RDA/WWA 0 0 0 0 0 0 17 Subtotal 614,700 584,100 584,100 584,100 584,100 584,100 0 1,614,600 90,100 0 2,400 0 216,400 0 -30,600 18 Total 21,186,400 21,800,600 22,087,800 22,381,100 22,680,800 22,986,800 1,800,400 19 % Change 4.28% 2.90% 1.32% 1.33% 1.34% 1.35% 8.50% (a) Reflects 3.0% revenue increase effective January 1, 2022. Table W - 5 - Water Projected Other Revenues Line 1 Description Water Impact Fee Revenue 2021 S 976,300 2022 S 976,300 Projected 2023 S 976,300 2024 S 976,300 2025 S 976,300 I 2026 S 976,300 0 2 Water Sales Not on Computer 300 300 300 300 300 300 0 3 Water Connection Fees 162,000 162,000 162,000 162,000 162,000 162,000 0 4 Rural Water Connection Fees 2,700 2,700 2,700 2,700 2,700 2,700 0 5 Service Charge/Trip Fee - Billed Service 9,500 9,500 9,500 9,500 9,500 9,500 0 6 Tampering Fee - Billed Service 200 200 200 200 200 200 0 7 Penalties 103,700 207,400 207,400 207,400 207,400 207,400 103,700 20,200 8 Safe Drinking Water Fee 230,000 233,800 237,800 241,800 245,900 250,200 9 10 Total % Change 1,484,700 -0.99% 1,592,200 7.24% 1,596,200 0.25% 1,600,200 0.25% 1,604,300 0.26% 1,608,606 0.27% 123,900 8.35% BLACK & VEATCH I Appendix 1: Water Tables Page 288 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 6 - Water Capital Improvement Program 1 Water System Rehabilitation/Replacement 2,060,000 0 2,185,500 2,251,000 2,318,500 0 2 Water Tank Improvements 1,030,000 1,060,900 1,092,700 1,125,500 1,159,300 2,149,300 3 Water Storage & Pump Station Maintenance 103,000 106,100 109,300 112,600 115,900 0 4 Water Meters 849,800 875,200 901,500 928,500 956,400 0 5 Backflow Prevention Assemblies 51,500 53,000 54,600 56,300 58,000 0 6 W/S Improvements defined by Study (West Water Transmission Line) 618,000 636,500 655,600 675,300 695,600 4,776,200 7 Water Impact Fee Improvements 412,000 424,400 437,100 450,200 463,700 0 8 Utilities Financial Services Improvements 0 11,100 3,300 1,700 8,700 0 9 Water/Sewer Relocations - Bond Projects 174,600 265,200 273,200 281,400 289,800 0 10 Water/Sewer Impact Fee Cost Sharing 0 79,600 82,000 84,400 86,900 0 11 Utilities Technology Improvements 0 228,100 234,900 130,000 10,400 0 12 Water/Sewer Building -Office Improvements 0 26,500 27,300 28,100 29,000 0 13 Water/Sewer Equipment Expansions 0 26,500 27,300 28,100 29,000 0 14 Water & Sewer Rate/Operational Studies 0 10,600 10,900 11,300 11,600 0 15 Phosphorus Standards Management 0 26,500 27,300 28,100 29,000 0 16 Water & Sewer Technology Equipment Replacements 0 0 0 0 0 0 17 Water & Sewer Improvements Defined By Study 0 0 0 0 0 0 18 Huntsville Water Line Replacement (6-inch upto 8-inch) 776,300 0 0 0 0 0 19 Benson Water Tank 1,030,000 338,200 0 0 0 0 20 East Water Service Improvements - Township 3,290,600 0 0 0 0 0 21 South Garland Ave Waterline Replacement 253,800 0 0 0 0 0 22 East Water Service Improvements CS 3 (Gulley, PS, Goshen Lines) 0 5,304,500 0 0 0 0 23 Ila/Oaks Manor/Persimmon Waterline Replacements 927,000 0 0 0 0 0 24 25 Western Park Waterline Replacement N. College Waterline Replacement - upgrade from 8" to 12" 309,000 0 0 0 0 2,185,400 0 0 0 0 0 0 26 Total Capital Improvement Program 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 (a) Capital costs reflect 3% annual inflation starting in 2021. Table W - 7 - Water Projected O&M Expenses 1 Personal Costs 3,433,900 3,580,100 3,732,600 3,891,600 4,057,400 4,230,400 2 Materials and Supplies 968,100 997,100 1,027,000 1,057,800 1,089,600 1,122,200 3 Services and Charges 9,994,600 10,294,400 10,603,300 10,921,400 11,249,000 11,586,500 4 Motorpool 837,100 862,200 888,000 914,700 942,100 970,400 5 Cost Allocation 631,100 650,000 669,500 689,600 710,300 731,600 6 Maintenance 85,800 88,400 91,100 93,800 96,600 99,500 7 Total 15,950,600 16,472,200 17,011,500 17,568,900 18,145,000 18,740,600 8 %Change 1.91% 3.27% 3.27% 3.28% 3.28% 3.28% BLACK & VEATCH I Appendix 1: Water Tables Page 289 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 8 - Capital Program Financing S S S S S S Sources of Funds 1 Funds Available at Beginning of Year 500,200 506,800 501,700 501,700 503,600 508,700 2 Cash Financing of Capital Projects 5,460,000 9,050,000 6,860,000 6,110,000 6,180,000 6,920,000 3 Transfer from Impact Fee Fund 6,432,200 417,800 1,447,900 84,400 86,900 0 4 Subtotal 12,392,400 9,974,600 8,809,600 6,696,100 6,770,500 7,428,700 Application of Funds 5 Major Capital Improvements 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 6 Subtotal 11,885,600 9,472,900 8,307,900 6,192,500 6,261,800 6,925,500 7 End of Year Balance 506,800 501,700 501,700 503,600 508,700 503,200 8 Capital Reserve ECY Balance - Cumulative 12,915,000 8,453,000 6,559,000 5,789,000 5,359,000 4,634,000 BLACK & VEATCH I Appendix 1: Water Tables 10-6 Page 290 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 9 - Water Operating Cash Flow S S S S S S Revenues 1 Revenue Under Existing Rates 21,186,600 21,800,700 22,087,800 22,381,200 22,680,800 22,986,900 Indicated Revenue Increases 2 0% Increase Effective January 1, 2022 0 0 0 0 0 3 0% Increase Effective January 1, 2023 0 0 0 0 0 4 3 % Increase Effective January 1, 2024 0 0 615,500 680,400 689,600 5 3 % Increase Effective January 1, 2025 0 0 0 642,400 710,300 6 3% Increase Effective January 1, 2026 0 0 0 0 670,600 7 Total Revenue from Rates 21,186,600 21,800,700 22,087,800 22,996,700 24,003,600 25,057,400 8 Other Revenues (a) 533,100 641,500 644,200 649,800 655,800 662,300 9 Total Revenue 21,719,700 22,442,200 22,732,000 23,646,500 24,659,400 25,719,700 Expenses 10 Operating Expenses 15,950,600 16,472,200 17,011,500 17,568,900 18,145,000 18,740,600 11 Bad Debt 105,900 109,000 110,400 115,000 120,000 125,300 12 PILOT 900,400 926,500 938,700 977,400 1,020,200 1,064,900 13 Safe Drinking Water Fee 230,000 233,800 237,800 241,800 245,900 250,200 14 Debt Service 0 0 0 0 0 0 15 Total Expenses 17,186,900 17,741,500 18,298,400 18,903,100 19,531,100 20,181,000 Transfers 16 Transfer to Shop Fund 33,000 0 0 0 0 0 17 Transfer to Operating Reserve 128,600 133,000 137,500 142,000 146,900 151,800 18 Cash Financing of Capital 5,460,000 9,050,000 6,860,000 6,110,000 6,180,000 6,920,000 19 Transfer to/from Capital Reserve -1,093,000 -4,479,000 -2,567,500 -1,505,000 -1,210,000 -1,522,000 20 Total Transfers 4,528,600 4,704,000 4,430,000 4,747,000 5,116,900 5,549,800 Fund Balance 21 Beginning Balance 99,400 103,600 100,300 103,900 100,300 111,700 22 Annual Operating Balance 4,200 -3,300 3,600 -3,600 11,400 -11,100 23 Ending Fund Balance 103,600 100,300 103,900 100,300 111,700 100,600 Performance Metrics 24 Debt Service Coverage NA NA NA NA NA NA 25 O&M Reserve Balance (Days) (b) 0 900 900 900 900 900 90 (a) Includes interest income on operating fund balance. (b) Mininum requirement is 90 days of following year's Operating Expenses. BLACK & VEATCH I Appendix 1: Water Tables Page 291 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W -10 - Water Fund Balances $ S S S $ $ Operating Funds 1 O&M Reserve Balance (a) 4,061,600 4,194,600 4,332,100 4,474,100 4,621,000 4,772,800 2 Operating Fund Balance (b) 103,600 100,300 103,900 100,300 111,700 100,600 3 Total (e) 4,165,200 4,294,900 4,436,000 4,574,400 4,732,700 4,873,400 Capital Funds 4 Capital Fund Balance (c) 506,800 501,700 501,700 503,600 508,700 503,200 5 Capital Reserve Fund Balance (d) 12,915,000 8,436,000 5,868,500 4,363,500 3,153,500 1,631,500 6 Total (e) 13,421,800 8,937,700 6,370,200 4,867,100 3,662,200 2,134,700 7 Impact Fee Fund Balance (e) 22,800 581,300 109,700 1,001,600 1,891,000 2,867,300 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target mininum balance is $100,000 to account for any adjustments that may be needed to the O&M balance at the end of the year. (c) Target mininum balance is $500,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. BLACK & VEATCH I Appendix 1: Water Tables Page 292 of 425 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Revised Draft 06/08/2022 Table W - 11 - Water 2023 Cost of Service R Statement of Net Revenue Requirements (Cash Basis) :j R Revenue Requirements 1 O&M Expenses 17,011,500 17,011,500 2 Bad Debt Expense 110,400 110,400 3 PILOT 938,700 938,700 4 Debt Service 0 0 Other Expenditures & Transfers: Transfer to Shop Fund (Capital Outlay) 5 Transfer to Operating Reserve 137,500 137,500 6 Cash Funding of Capital Projects 6,860,000 6,860,000 7 Transfer to Capital Reserve -2,567,500 -2,567,500 8 Subtotal 18,198,100 4,292,500 22,490,600 Less Revenue Requirements Met from Other Sources 9 Other Revenues 382,100 382,100 10 Interest Earned 24,300 24,300 11 Net Balance Available -3,600 -3,600 12 Full Year Rate Adjustment 13 Subtotal 406,400 -3,600 402,800 14 Net Revenue Requirements to be Recovered by 17,791,700 4,296,100 22,087,800 Restatement of Net Cost of Service (Utility Basis) 15 O&M Expenses 17,791,700 17,791,700 16 Depreciation 2,820,100 2,820,100 17 Return 1,476,000 1,476,000 18 Net Cost of Service 17,791,700 4,296,100 22,087,800 BLACK & VEATCH I Appendix 1: Water Tables Page 293 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W -12 - Water 2023 Allocation of Net Plant Investment to Functional Cost Components s s s s s s s s s s Net Plant Investment: 1 Water Land and Land Rights 2,191,756 1,043,693 1,148,063 2 Water Supply 6,819,846 3,247,546 3,572,300 3 Water Storage and Pumping 6,090361 2,900,172 3,190,189 4 Water Transmission 26,043:791 12,401,805 13,641,986 5 Water Distribution 47,479,642 17,391,810 9,565,496 5,478,420 15,043,916 6 Water Meters 3,289,003 3,289,003 7 Fire Hydrants 7,535,573 7,535,573 8 Water General System 4,537,529 761,641 837,805 925,847 581,994 249,960 836,462 343,820 9 Total Net Plant Investment 103,987,502 17,454,685 19,200,154 0 21,217,829 13,337,679 5,728,380 19,169,381 0 7,879,393 Table W - 13 - Water 2023 Allocation of Net Annual Depreciation to Functional Cost Components s s s s s s s s s s Net Depreciation Expense: 1 Water Land and Land Rights 2 Water Supply 277,295 132,045 145,250 3 Water Storage and Pumping 219,139 104,352 114,787 4 Water Transmission 706,125 336,250 369,875 5 Water Distribution 1,134,421 415,539 228,546 130,895 359,441 6 Water Meters 169,405 169,405 7 Fire Hydrants 215,879 215,879 8 Water General System 97,807 16,825 18,508 18,679 12,336 4,703 19,001 7,756 9 Total Net Depreciation Expense 2,820,070 485,120 533,632 0 538,570 355,669 135,598 547,847 0 223,635 Table W - 14 - Water 2023 Allocation of O&M Expenses to Functional Cost Components 1 Water Purchased 9,611,754 4,577,026 5,034,728 2 Water Storage and Pumping 269,987 98,896 108,786 62,305 3 Water Distribution (a) 3,105,785 1,005,654 1,251,415 716,720 100,938 31,058 4 Meter Services(b) 1,007,563 1,007,563 5 Customer Billing(c) 1,051,559 1,051,559 6 All Other Cost 3,151,452 958,637 1,054,501 231,343 284,888 163,163 211,029 220,244 21,141 6,505 7 Subtotal 18,198,100 5,535,663 6,089,229 0 1,335,894 1,645,089 942,187 1,218,592 1,271,804 122,079 37,563 Less: 8 Water Connection Fees(d) 164,700 164,700 9 Other Income Sources 241,700 89,707 80,875 17,743 21,849 12,514 16,892 1,621 499 10 Subtotal 406,400 89,707 80,875 17,743 21,849 12,514 164,700 16,892 1,621 499 11 Net O&M Expenses 17,791,700 5,445,956 6,008,355 1,318,151 1,623,240 929,674 1,053,892 1,254,912 120,458 37,064 (a) 3.25%of 2020 water repair costs was associated with hydrants. (b) Includes costs for Meter Reading and Meter Maintenance and Backflow prevention (c) Includes costs under Utilities Financial Services (d) Includes revenues from Water Connection Fees and Rural Water Connection Fees BLACK & VEATCH I Appendix 1: Water Tables 10-10 Page 294 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W -15 - Water 2023 Estimated Units of Service 1,000 ga 1. 1,000 gal. 1,000 ga 1. 1,000 gal. 1,000 ga 1. 1,000 ga I. Equiv. Meters Bills =quiv. Hyd,a t!Equ .Hydrants (1)/365 (2)x(3) (4)-(2) (2)x(6) (7)-(4) Inslde City 1 Residential 1,800,801 4,934 250% 12,334 7,401 370% 18,255 5,920 34,939 437,192 2 Non -Residential 827,079 2,266 240% 5,438 3,172 355% 8,044 2,606 6,761 41,712 3 Industrial 401,767 1,101 200% 2,201 1,101 295% 3,247 1,046 261 252 4 Irrigation 248,556 681 240% 1,634 953 355% 2,417 783 3,141 25,333 5 Subtotal 3,278,204 8,981 21,608 12,627 31,964 10,355 45,102 504,489 Fire Protection 6 Public 4,201 4,201 10,083 5,882 4,035 7 Private 491 491 1,179 688 472 8 Subtotal 3,278,204 8,981 26,300 17,319 43,226 16,925 45,102 504,489 4,035 472 Outside City Farmington 9 Residential 85,288 234 250% 584 350 370% 865 280 1,762 23,614 30 Non -Residential 17,853 49 240% 117 68 355% 174 56 245 2,431 11 Industrial 200% 295% 12 Irrigation 1,359 4 240% 9 5 355% 13 4 46 480 13 Subtotal 104,500 286 710 424 1,051 341 2,053 26,525 Greenland 14 Residential 19,818 54 250% 136 81 370% 201 65 458 5,676 15 Non -Residential 4,298 12 240% 28 16 355% 42 14 59 588 16 Industrial 200% 295% 17 Irrigation 1,230 3 240% 8 5 355% 12 4 20 96 18 Subtotal 25,345 69 172 103 255 83 537 6,360 Washington County/Growth 19 Residential 198,114 543 250% 1,357 814 370% 2,008 651 2,618 34,384 20 Non -Residential 24,123 66 240% 159 93 355% 235 76 109 1,368 21 Industrial 200% 295% 22 Irrigation 14,574 40 240% 96 56 355% 142 46 188 1,884 23 Subtotal 236,811 649 1,611 963 2,385 773 2,915 37,635 Johnson 24 Residential 6,718 18 250% 46 28 370% 68 22 158 2,064 26 Non -Residential 8,320 23 240% 55 32 355% 81 26 35 240 27 Industrial 200% 295% 28 Irrigation 77 0 240% 1 0 355% 1 0 3 24 29 Subtotal 15,115 41 101 60 150 49 196 2,328 Goshen/White River 3o Residential 84,663 232 250% 580 348 370% 858 278 1,054 15,447 31 Non -Residential 11,837 32 240% 78 45 355% 115 37 52 768 32 Industrial 200% 295% 33 Irrigation 7,781 21 240% 51 30 355% 76 25 86 931 34 Subtotal 104,281 286 709 423 1,049 340 1,192 17,146 Fire Protection 35 Public 696 696 1,669 973 668 36 Private 12 12 29 17 12 37 Subtotal 486,052 1,332 4,012 2,680 6,588 2,575 6,892 89,994 668 12 38 Total Retail 3,764,256 20,313 30,312 19,999 49,813 19,501 51,994 594,483 Wholesale 39 Elkins 75,031 206 240% 493 288 355% 730 236 23 12 40 Mount Olive 62,062 170 240% 408 238 355% 604 196 38 24 41 West Fork 65,226 179 240% 429 250 355% 634 206 23 12 42 RDA/WWA 240% 355% 48 43 Subtotal 202,319 554 1,330 776 1,968 637 83 96 44 Subtotal(Inside City) 3,278,204 8,981 26,300 17,319 43,226 16,925 45,102 504,489 4,035 472 45 Subtotal (Outside City) 486,052 1,332 4,012 2,680 6,588 2,575 6,892 89,994 668 12 46 Subtotal (Wholesale) 202,319 554 1,330 776 1,968 637 83 96 47 Total System 3,966,575 10,867 31,643 20,775 51,781 20,138 52,077 594,579 4,703 483 BLACK & VEATCH I Appendix 1: Water Tables 10-11 Page 295 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 16 - Water 2023 Unit Cost of Service $ 1,000 gal. 1,000 gpd. 1,000 gpd. 1,000 gal. 1,000 gpd. 1,000 gpd. Equiv. Meters Bills Hydrants Hydrants Units of Service 1 Inside City 3,278,204 17,319 16,925 3,278,204 17,319 16,925 45,102 504,489 4,035 472 2 Outside City 688,371 3,456 3,213 486,052 2,680 2,575 6,975 90,090 668 12 3 Total System 3,966,575 20,775 20,138 3,764,256 19,999 19,501 52,077 594,579 4,703 483 Costs of Service Net Operating Costs 4 Total -$ 17,791,700 5,445,956 6,008,355 0 1,318,151 1,623,240 929,674 1,053,892 1,254,912 120,458 37,064 5 Unit Cost - $/unit 1.37 289.20 0.00 0.35 81.16 47.67 20.24 2.11 25.61 76.68 Depreciation Expense 6 Total - $ 2,820,070 485,120 533,632 0 538,570 355,669 135,598 547,847 223,635 7 Unit Cost - $/unit 0.12 25.69 0.00 0.14 17.78 6.95 10.52 47.55 Net Plant Investment 8 Total -$ 103,987,502 17,454,685 19,200,154 0 21,217,829 13,337,679 5,728,380 19,169,381 7,879,393 9 Unit Cost - $/unit 4.40 924.18 0.00 5.64 666.90 293.75 368.09 1,675.40 Return on Investment 10 Inside City, Unit Return - $/unit 0.02 4.29 0.00 0.03 3.10 1.36 1.71 7.78 11 Outside City, Unit Return - $/Unit 0.31 64.69 0.00 0.39 46.68 20.56 25.77 117.28 Total Return 12 Inside City -$ 412,445 67,007 74,347 0 85,831 53,650 23,094 77,115 31,401 13 Outside City- $ 1,063,585 212,040 223,605 0 191,780 125,131 52,959 179,730 78,342 14 Total Return -$ 1,476,030 279,046 297,952 0 277,610 178,781 76,053 256,845 109,743 Total Unit Cost of Service 15 Inside City Unit Cost - $/unit 1.52 319.18 0.00 0.52 102.05 55.99 32.47 2.11 80.95 76.68 16 Outside City Unit Cost- $/unit 1.80 379.58 0.00 0.89 145.63 75.19 56.52 2.11 190.44 76.68 17 Inside City- Cost of Service - $ 17,806,421 4,968,786 5,527,935 0 1,702,806 1,767,336 947,674 1,464,315 1,064,768 326,620 36,179 18 Outside City- Cost of Service - $ 4,281,379 1,241,336 1,312,003 0 431,525 390,353 193,649 394,269 190,144 127,215 885 19 Total Cost of Service -$ 22,087,900 6,210,122 6,839,938 0 2,134,331 2,157,689 1,141,324 1,858,584 1,254,912 453,835 37,064 BLACK & VEATCH I Appendix 1: Water Tables 10-12 Page 296 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 17 - Water 2023 Cost of Service by Customer Class 1 Inside City Residential 9,170,800 1,473,200 10,644,000 11,194,200 -4.9% 2 Non -Residential 3,473,000 557,900 4,030,800 3,476,000 16.0% 3 Industrial 1,348,900 216,700 1,565,600 1,196,700 30.8% 4 Irrigation 1,106,700 177,800 1,284,500 1,456,300 -11.8% 5 Fire Protection Public 2,425,500 -2,425,500 6 Private 281,500 281,500 967,600 -70.9% 7 8 9 Subtotal Outside City Residential Non -Residential 17,806,400 2,524,400 368,000 100 469,500 68,400 17,806,400 2,994,000 436,500 18,290,800 2,674,900 333,000 -2.6% 11.9% 31.1% 10 Industrial 0.0% 11 Irrigation 150,200 27,900 178,200 177,900 0.2% 12 Fire Protection Public 565,900 -565,900 13 Private 8,500 8,500 27,100 -68.6% 14 15 Subtotal Wholesale Elkins 3,617,000 245,800 -100 3,617,200 245,800 3,212,900 216,200 12.6% 13.7% 16 Mount Olive 204,500 204,500 179,800 13.7% 17 18 West Fork RDA/WWA 213,900 0 213,900 0 188,100 0 13.7% 0.0% 19 20 Subtotal Wholesale Total Retail 664,200 21,423,400 0 0 664,200 21,423,600 584,100 21,503,700 13.7% -0.4% 21 Total Wholesale 664,200 0 664,200 584,100 13.7% 22 Total 22,087,600 0 22,087,800 22,087,800 0.0% BLACK & VEATCH I Appendix 1: Water Tables 10-13 Page 297 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 18 - Water Proposed 2023 Rates Existing Water Rates Effective January 1, 2022 Proposed Water Rates Effective January 1, 2023 Monthly Base Charge Inches $/month $/month $/month $/month •Inside $/month ".ter Si.e City 4=1 Inches $/month $/month Wholesale $/month Inside City Private Fire $/month Outside Private Fi1r] $/month 5/8 6.59 7.54 8.31 5/8 6.59 7.54 8.31 3/4 6.59 7.54 8.31 3/4 6.59 7.54 8.31 1 9.14 10.52 11.49 9.75 11.68 1 9.14 12.26 12.26 9.75 11.68 1 1/2 15.93 18.31 20.00 10.17 12.10 1 1/2 15.93 24.22 24.22 10.17 12.10 2 23.20 26.66 29.07 20.33 23.37 2 23.20 33.52 33.52 20.33 23.37 3 54.05 62.18 64.38 30.48 35.06 3 54.05 69.84 69.84 30.48 35.06 4 89.50 102.93 112.25 60.97 70.11 4 89.50 102.93 112.25 60.97 70.11 6 178.99 205.82 212.76 169.34 197.74 6 178.99 205.82 212.76 169.34 197.74 8 268.41 308.67 332.91 355.65 409.00 8 268.41 308.67 332.91 355.65 409.00 10 Volume Charge 609.68 701.11 10 Volume Charge 609.68 701.11 ------- 1,000 gal. Inside city 1,000 gal. Outside city 1,000 gal. Wholesale 1,000 gal. Monthly Water Usage 1,000 gal. Inside city 1,000 gal. Outside city 1,000 gal. Wholesale 1,000 gal. Residential Residential 0 - 2,000 Gallons 3.51 4.04 0 - 2,000 Gallons 3.30 4.47 2,000 - 15,000 Gallons 4.65 5.35 2,000 - 15,000 Gallons 4.27 5.91 Over 15,000 Gallons 6.59 7.54 Over 15,000 Gallons 6.20 8.38 Non -Residential Non -Residential First 300,000 Gallons 3.79 4.38 First 300,000 Gallons 3.93 5.05 Over 300,000 Gallons 3.39 3.90 Over 300,000 Gallons 3.93 5.05 Major Industrial Major Industrial All Usage 2.96 3.40 All Usage 3.14 3.49 Irrigation Irrigation First 300,000 Gallons 5.04 5.80 First 300,000 Gallons 4.29 5.43 Over 300,000 Gallons 4.53 5.22 Over 300,000 Gallons 4.29 5.43 Wholesale Wholesale Reduced Peak Demand 2.87 Reduced Peak Demand 3.16 Peak Demand 3.20 Peak Demand 3.16 BLACK & VEATCH I Appendix 1: Water Tables 10-14 Page 298 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 19 - Water 2023 Cost of Service Under Proposed Rates 1 Inside City Residential 10,644,000 11,194,200 -4.9% 10,652,800 100% -5% -541,400 2 Non -Residential 4,030,800 3,476,000 16.0% 3,687,200 91% 6% 211,200 3 Industrial 1,565,600 1,196,700 30.8% 1,272,200 81% 6% 75,500 4 Irrigation 1,284,500 1,456,300 -11.8% 1,294,800 101% -11% -161,500 5 6 Subtotal Outside City Residential 17,524,900 2,994,000 17,323,200 2,674,900 1.2% 11.9% 16,907,000 2,903,900 96% 97% -2% 9% -416,200 229,000 7 Non -Residential 436,500 333,000 31.1% 387,400 89% 16% 54,400 8 Irrigation 178,200 177,900 0.2% 172,900 97% -3% -5,000 9 Subtotal 3,608,700 3,185,800 13.3% 3,464,200 96% 9% 278,400 Private Fire 10 Inside City 281,500 967,600 -70.9% 967,600 344% 0% 0 11 Outside City 8,500 27,100 -68.6% 27,100 319% 0% 0 12 Subtotal 290,000 994,700 -70.8% 994,700 343% 0% 0 Wholesale 13 Elkins 245,800 216,200 13.7% 238,400 97% 10% 22,200 14 Mount Olive 204,500 179,800 13.7% 198,300 97% 10% 18,500 15 West Fork 213,900 188,100 13.7% 207,500 97% 10% 19,400 16 RDA/WWA 0 0 0 0% 0% 17 Subtotal 664,200 584,100 13.7% 644,200 97% 10% 60,100 18 Total 22,087,800 22,087,800 0.0% 22,010,100 100% 0%-77,700 BLACK & VEATCH I Appendix 1: Water Tables 10-15 Page 299 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table W - 20 - Water 2023 Bill Impact Line No. Residential 1 Meter Si�e Inches 3/4 Monthly Usage 1,000 ga I. 0.5 Existing Rates $ 9.91 Inside City Proposed Rates $ 8.24 increase / increase Decrease Decrease $ -1.67 / -16.9% Existing Rates $ 11.36 Outside City Proposed Increase Rates $ 9.78 / increase Decrease Decrease $ -1.59 -14.0% 2 3/4 2 13.42 13.19 -0.23 -1.7% 15.40 16.48 1.08 7.0% 3 3/4 4 22.72 21.73 -0.99 -4.4% 26.10 28.30 2.20 8.4% 4 3/4 8 41.32 38.81 -2.51 -6.1% 47.50 51.94 4.44 9.3% 5 3/4 10 50.62 47.35 -3.27 -6.5% 58.20 63.76 5.56 9.6% 6 3/4 15 73.87 68.70 -5.17 -7.0% 84.95 93.31 8.36 9.8% Non -Residential 7 3/4 10 44.30 45.89 1.59 3.6% 51.12 58.04 6.92 13.5% 8 3/4 20 82.20 85.19 2.99 3.6% 94.92 108.54 13.62 14.3% 9 1 50 198.37 205.64 7.27 3.7% 229.21 264.76 35.55 15.5% 10 1 100 387.87 402.14 14.27 3.7% 448.21 517.26 69.05 15.4% 11 11/2 50 204.97 212.43 7.46 3.6% 236.78 276.72 39.94 16.9% 12 11/2 100 394.47 408.93 14.46 3.7% 455.78 529.22 73.44 16.1% 13 2 100 401.52 416.20 14.68 3.7% 463.88 538.52 74.64 16.1% 14 2 500 1,837.52 1,988.20 150.68 8.2% 2,119.88 2,558.52 438.64 20.7% Industrial 15 2 100 318.52 337.20 18.68 5.9% 362.52 382.52 20.00 5.5% 16 2 1,000 2,982.52 3,163.20 180.68 6.1% 3,422.52 3,523.52 101.00 3.0% 17 4 500 1,566.89 1,659.50 92.61 5.9% 1,786.89 1,847.93 61.04 3.4% 18 4 1,500 4,526.89 4,799.50 272.61 6.0% 5,186.89 5,337.93 151.04 2.9% 19 6 2,500 7,573.78 8,028.99 455.21 6.0% 8,673.78 8,930.82 257.04 3.0% 20 6 5,000 14,973.78 15,878.99 905.21 6.0% 17,173.78 17,655.82 482.04 2.8% 21 6 10,000 1 29,773.78 31,578.99 1,805.21 6.1% 34,173.78 35,105.82 932.04 2.7% BLACK & VEATCH I Appendix 1: Water Tables 10-16 Page 300 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 11.0 Appendix 2: Wastewater Tables Table S - 1 - Wastewater Projected Accounts Inside City 1 Residential 34,600 35,200 35,800 36,400 37,000 37,700 3,100 2 Non -Residential 2,900 2,900 2,900 2,900 2,900 2,900 0 3 Industrial 21 21 21 21 21 21 0 4 Subtotal 37,521 38,121 38,721 39,321 39,921 40,621 3,100 Outside City 5 Residential 2,400 2,400 2,500 2,500 2,500 2,500 100 6 Non -Residential 184 184 184 184 184 184 0 7 Industrial 0 0 0 0 0 0 0 8 Subtotal 2,584 2,584 2,684 2,684 2,684 2,684 100 Wholesale 9 Elkins 2 2 2 2 2 2 0 10 West Fork 1 1 1 1 1 1 0 0 11 Subtotal 2 2 2 2 2 2 11 Total 40,107 40,707 41,407 42,007 42,607 43,307 3,200 12 %Change 1.52% 1.50% 1.72% 1.45% 1.43% 1.64% 7.98% Table S - 2 - Wastewater Projected Billed Volume (1,000 Gallons) 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Inside City 1 Residential 1,861,300 1,741,200 1,771,800 1,802,800 1,834,400 1,866,500 5,200 2 Non -Residential 626,900 698,700 698,600 698,600 698,600 698,600 71,700 3 Industrial 318,500 396,700 396,700 396,700 396,700 396,700 78,200 4 Subtotal 2,806,700 2,836,600 2,867,100 2,898,100 2,929,700 2,961,800 155,100 Outside City 5 Residential 94,500 97,400 98,700 100,100 101,400 102,800 8,300 6 Non -Residential 15,300 15,000 15,000 15,000 15,000 15,000 -300 7 Industrial 0 0 0 0 0 0 0 8 Subtotal 109,800 112,400 113,700 115,100 116,400 117,800 8,000 Wholesale 8 Elkins 81,000 81,000 81,000 81,000 81,000 81,000 0 9 West Fork 45,600 45,600 45,600 45,600 45,600 45,600 0 10 Subtotal 126,600 126,600 126,600 126,600 126,600 126,600 0 10 Total 3,043,100 3,075,600 3,107,400 3,139,800 3,172,700 3,206,200 163,100 11 %Change 2.30% 1.07% 1.03% 1.04% 1.05% 1.06% 5.36% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 301 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 3 - Wastewater Existing Charges Existing Wastewater Rates Effective January 1, 2022 Inches $/month $/month $/month 5/8 18.28 18.28 16.74 3/4 18.28 18.28 16.74 1 23.74 33.92 31.28 1 1/2 38.77 60.37 55.50 2 55.43 79.73 73.45 3 128.73 184.24 169.29 4 212.13 303.44 278.93 6 8 420.39 628.73 601.46 899.76 553.70 826.81 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal. Residential First 2,000 Gallons 4.35 > 2,000 Gallons 5.80 All Usage 8.18 7.52 Non -Residential All Usage 4.40 8.18 7.52 Major Industrial All Usage 4.71 8.18 7.52 Wholesale 85% of metered water usage 5.19 Above 85% of metered water 2.71 Surcharge BOD - $/Ib for strength in excess of 300 ppm 0.4352 T55 - $/Ib for strength in excess of 300 ppm 0.3056 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 302 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 4 - Wastewater Projected Revenues at Existing Rates S S S S S S Inside City 1 Residential 16,696,700 16,719,800 17,013,000 17,310,700 17,613,700 17,921,900 2 Non -Residential 3,505,200 3,926,200 3,926,100 3,926,100 3,926,100 3,926,100 3 Industrial 1,477,500 1,890,100 1,890,100 1,890,100 1,890,100 1,890,100 4 Subtotal 21,679,400 22,536,100 22,829,200 23,126,900 23,429,900 23,738,100 Outside City 5 Residential 1,177,400 1,242,000 1,258,300 1,274,800 1,291,700 1,308,800 6 Non -Residential 158,100 160,400 160,400 160,400 160,400 160,400 7 Industrial 0 0 0 0 0 0 8 Subtotal 1,335,500 1,402,400 1,418,700 1,435,200 1,452,100 1,469,200 Wholesale 9 Elkins 407,300 419,500 419,500 419,500 419,500 419,500 10 West Fork 229,400 236,200 236,200 236,200 236,200 236,200 11 Subtotal 636,700 655,700 655,700 655,700 655,700 655,700 12 Surcharge 810,300 834,600 834,600 834,600 834,600 834,600 13 Total 24,461,900 25,428,800 25,738,200 26,052,400 26,372,300 26,697,600 14 %Change 4.90% 3.95% 1.22% 1.22% 1.23% 1.23% (a) Reflects 3.0% revenue increase effective January 1, 2022. Table S - 5 - Wastewater Projected Other Revenues S S S S S S 1 Sewer Impact Fee Rev 743,900 743,900 743,900 743,900 743,900 743,900 2 Sewer Sales Not on Cc 11,800 11,800 11,800 11,800 11,800 11,800 3 Sewer Connection Fee 47,900 47,900 47,900 47,900 47,900 47,900 4 WWTP Hay Sales 134,800 134,800 134,800 134,800 134,800 134,800 5 WWTP Biosolids/Fertil 54,900 54,900 54,900 54,900 54,900 54,900 6 WWTP Water Treatme 180,800 180,800 180,800 180,800 180,800 180,800 7 Penalties 123,000 246,100 246,100 246,100 246,100 246,100 8 Total 1,297,100 1,420,200 1,420,200 1,420,200 1,420,200 1,420,200 9 %Change -1.52% 9.49% 0.00% 0.00% 0.00% 0.00% 2,058,700 0 6,800 19,000 24,300 2,235,700 9.14% 0 0 0 0 0 0 123,100 123,100 9.49% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 303 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 6 - Wastewater Capital Improvement Program 1 Sanitary Sewer Rehabilitation 2,956,100 3,044,800 3,136,100 3,230,200 3,327,100 0 2 Plant Pumps and Equipment- W.W.T.P. 515,000 530,500 546,400 562,800 579,600 0 3 W.W.T.P. Building Improvements 1,699,500 1,750,500 163,900 168,800 173,900 0 4 Upgrade/Replace Lift Stations -W.W.T.P. 309,000 318,300 327,800 337,700 347,800 0 5 Lake Sequoyah Sediment Removal/Dredging 515,000 530,500 546,400 562,800 579,600 0 6 Wastewater Treatment/Water Quality Improvement! 103,000 106,100 109,300 112,600 115,900 0 7 Wastewater Impact Fee Improvements 309,000 318,300 327,800 337,700 347,800 0 8 Utilities Financial Services Improvements 0 11,100 3,300 1,700 8,700 0 9 Water/Sewer Relocations - Bond Projects 174,600 265,200 273,200 281,400 289,800 0 10 Water/Sewer Impact Fee Cost Sharing 0 79,600 82,000 84,400 86,900 0 11 Utilities Technology Improvements 0 228,100 234,900 130,000 10,400 0 12 Water/Sewer Building -Office Improvements 0 26,500 27,300 28,100 29,000 0 13 Water/Sewer Equipment Expansions 0 26,500 27,300 28,100 29,000 0 14 Water & Sewer Rate/Operational Studies 0 10,600 10,900 11,300 11,600 0 15 Phosphorus Standards Management 0 26,500 27,300 28,100 29,000 0 16 Water & Sewer Technology Equipment Replacements 0 0 0 0 0 0 17 Water & Sewer Improvements Defined By Study 0 0 0 0 0 0 18 Biosolids Dryer Replacement 0 0 3,278,200 9,004,100 9,274,200 9,552,400 19 Filter Cell Upgrade/Replacement at Noland WWTP 0 0 0 0 0 1,432,900 20 Upgrade Automation at both WWTPs 0 0 0 0 0 1,671,700 21 CIPP of 36" Sewer Line from Armstrong Ave to Nolan 0 0 0 0 0 1,194,100 22 23 Bypass Sewer Fulbright & North Gregg Hamestring Lift Station Bottle Neck Resolution 1,442,000 0 0 848,700 0 0 0 0 0 0 0 0 24 Total Capital Improvement Program 8,023,200 8,121,800 9,122,200 14,909,800 15,240,300 13,852,100 (a) Capital costs reflect 3% annual inflation starting in 2021. Table S - 7 - Wastewater Projected O&M Expenses 1 Personal Costs 3,074,800 3,205,800 3,342,400 3,484,900 3,633,500 3,788,600 2 Materials and Supplies 724,700 746,400 768,800 791,800 815,600 840,100 3 Services and Charges 6,080,800 6,263,300 6,451,200 6,644,700 6,844,000 7,049,400 4 WWTP Contract 3,995,600 4,115,500 4,238,900 4,366,100 4,497,100 4,632,000 5 Motorpool 1,032,500 1,063,400 1,095,300 1,128,200 1,162,100 1,196,900 6 Cost Allocation 680,700 701,200 722,200 743,900 766,200 789,200 7 Maintenance 84,800 87,400 90,000 92,700 95,500 98,300 8 9 Total %Change 15,673,900 0.81% 16,183,000 3.25% 16,708,800 3.25% 17,252,300 3.25% 17,814,000 3.26% 18,394,500 3.26% BLACK & VEATCH I Appendix 2: Wastewater Tables Page 304 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 8 - Wastewater Cash Financed Capital Sources of Funds 1 Funds Available at Beginning of Year 504,100 501,900 506,700 504,400 506,700 501,100 2 Cash Financing of Capital Projects 6,270,000 6,880,000 8,710,000 14,490,000 14,800,000 13,850,000 3 Transfer from Impact Fee Fund 1,751,000 1,246,600 409,800 422,100 434,700 0 4 Subtotal 8,525,100 8,628,500 9,626,500 15,416,500 15,741,400 14,351,100 Application of Funds 5 Major Capital Improvements 8,023,200 8,121,800 9,122,100 14,909,800 15,240,300 13,851,100 6 Subtotal 8,023,200 8,121,800 9,122,100 14,909,800 15,240,300 13,851,100 7 End of Year Balance 8 Capital Reserve EOY Balance - Cumulative Table S - 9 - Wastewater Operating Cash Flow 501,900 506,700 504,400 506,700 501,100 500,000 19,995,000 21,737,000 22,105,000 17,205,000 12,555,000 9,445,000 Revenues Revenues Under Existing Rates 24,461,900 25,428,800 25,738,200 26,052,500 26,372,200 26,697,600 Revenue Increases 0% Increase Effective January 1, 2022 0 0 0 0 0 0% Increase Effective January 1, 2023 0 0 0 0 0 3 % Increase Effective January 1, 2024 0 0 716,400 791,200 800,900 3 % Increase Effective January 1, 2025 0 0 0 747,000 825,000 3 % Increase Effective January 1, 2026 0 0 0 0 778,900 Total Revenue from Rates 24,461,900 25,428,800 25,738,200 26,768,900 27,910,400 29,102,400 Other Revenues (a) 594,700 720,500 719,400 721,600 724,200 727,000 Total Revenues 25,056,600 26,149,300 26,457,600 27,490,500 28,634,600 29,829,400 Expenses Operating Expenses 15,673,900 16,183,000 16,708,800 17,252,300 17,814,000 18,394,500 Bad Debt 122,300 127,100 128,700 133,800 139,600 145,500 PILOT 1,039,600 1,080,700 1,093,900 1,137,700 1,186,200 1,236,900 Debt Service 0 0 0 0 0 0 Total Expenses 16,835,800 17,390,800 17,931,400 18,523,800 19,139,800 19,776,900 Transfers Transfer to Shop Fund 33,000 0 0 0 0 0 Transfer to Operating Reserve 125,500 129,700 134,000 138,500 143,100 147,900 Cash Financing of Capital 6,270,000 6,880,000 8,710,000 14,490,000 14,800,000 13,850,000 Transfer to/from Capital Reserve 1,793,000 1,742,000 -312,000 -5,670,000 -5,450,000 -3,940,000 Total Transfers 8,221,500 8,751,700 8,532,000 8,958,500 9,493,100 10,057,900 Fund Balance Beginning Balance 106,700 106,000 112,800 107,000 115,200 116,900 Annual Operating Balance -700 6,800 -5,800 8,200 1,700 -5,400 Ending Fund Balance 106,000 112,800 107,000 115,200 116,900 111,500 Performance Metrics Debt Service Coverage NA NA NA NA NA NA 0&M Reserve Balance (Days) 0 90.00 0 90.00 O 90.00 O 90.00 O 90.00 O 90.00 Includes interest income on operating fund balance. Mininum requirement is 90 days of following year's Operating Expenses BLACK & VEATCH I Appendix 2: Wastewater Tables Page 305 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S -10 - Wastewater Projected Fund Balances Operating Funds 1 0&M Reserve Balance (a) 3,990,300 4,120,000 4,254,000 4,392,500 4,535,600 4,683,500 2 Operating Fund Balance (b) 106,000 112,800 107,000 115,200 116,900 111,500 3 Total (e) 4,096,300 4,232,800 4,361,000 4,507,700 4,652,500 4,795,000 Capital Funds 4 Capital Fund Balance (c) 501,900 506,700 504,400 506,700 501,100 500,000 5 Capital Reserve Fund Balance (d) 19,995,000 21,737,000 21,425,000 15,755,000 10,305,000 6,365,000 6 Total (e) 20,496,900 22,243,700 21,929,400 16,261,700 10,806,100 6,865,000 7 Impact Fee Fund Balance (e) 4,437,800 3,935,100 4,269,200 4,591,000 4,900,200 5,644,100 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target mininum balance is $100,000 to account for any adjustments that may be needed to the 0&M balance at the end of the year. (c) Target mininum balance is $500,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. Table S - 11 - Wastewater 2023 Cost of Service Statement of Net Revenue Requirements (Cash Basis) Revenue Requirements 1 O&M Expenses 16,708,800 16,708,800 2 Bad Debt 128,700 128,700 3 PILOT 1,093,900 1,093,900 4 Debt Sevice 0 0 Other Expenditures & Transfers: Transfer to Shop Fund (Capital Outlay) 0 0 5 Transfer to Operating Reserve 134,000 134,000 6 Cash Funding of Capital Projects 8,710,000 8,710,000 7 Transfer to Capital Reserve (312,000) (312,000) 8 Subtotal 18,065,400 8,398,000 26,463,400 Less Revenue Requirements Met from Other Sources 9 Other Revenues and Adjustments 10 Interest Earned 11 Net Balance Available 12 Full Year Rate 13 Subtotal 14 Net Revenue Requirements to be Recovered by Rates Restatement of Net Cost of Service (Utility Basis) 676,300 676,300 43,100 43,100 5,800 5,800 719,400 5,800 725,200 17,346,000 8,392,200 25,738,200 15 O&M Expenses 17,346,000 17,346,000 16 Depreciation 8,259,600 8,259,600 17 Return 132,600 132,600 18 Net Cost of Service 17,346,000 8,392,200 25,738,200 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 306 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 12 - Wastewater 2023 Allocation of Net Plant Investment s s s s s s s s s s s s s Net Plant Investment: 1 Sewer Collection 106,713,735 43,521,511 63,192,224 2 Sewer Connections 319,887 319,887 3 Water Meters 2,741,021 2,741,021 4 Owl Creek Lift Station and Force Main 14,103 14,103 5 Lift Stations 5,257,834 5,257,834 S-Toa tment Plant. Noland 6 Sewage Pumping 229,919 229,919 7 Mechanical Bar Screens 172,282 51,685 120,597 8 Grit Removal 9 PrimarySedimentation 10 Disinfection 1,684,829 1,684,829 11 Aeration Equipment 1,120,704 560,352 560,352 12 Sludge Handling 400,690 220,380 180,311 13 Other Plant and Misc Equipment 961,187 510,038 221,733 229,416 14 General Treatment 14,870,670 7,890,861 3,430,472 3,549,337 S-Tna tment Plant -West 15 Sewage Pumping 121,333 845,784 75,549 16 Mechanical Bar Screens 169,]27 13,91E 46,743 109,%B 17 Grit Removal 1,380,570 113,207 1,267,363 18 PrimarySedimentation 6,927,776 568,078 1,907,909 4,451,739 19 Disinfection 667,246 612,532 54,714 20 Aeration Equipment 1,490,202 122,197 684,003 684,003 21 Sludge Handling 34,604,278 2,837,551 17,471,700 14,295,027 22 Other Plant and Misc Equipment 3,425,729 108,225 280,910 1,492,438 1,544,156 23 General Treatment 7,795,332 246,269 639,217 3,396,080 3,513,766 24 Sewer Land and Land Rights 6,358,594 1,917,514 132,595 2,484,095 148,797 823,260 851,789 554 25 General Plant 1,768,194 449,533 111,771 582,356 43,363 271,709 281,124 25,260 3,078 26 Total Net Plant Investment 199,995,842 51,146,392 12,372,M 66,258,665 0 4,897,502 0 30,578,964 0 31,638,096 0 2,766,281 337,622 Table S - 13 - Wastewater 2023 Allocation of Depreciation Net Depreciation Expense: 1 Sewer Collection 2,890,542 1,178,862 1,711,690 2 Sewer Connections 22,463 22,463 3 Water Meters 141,180 141,180 4 Owl Creek Lift Station and Force Main 6,509 6,509 5 Lift Stations 113,991 113,991 Sewer Treatment Plant- Noland 6 Sewage Pumping 42,418 42,418 7 Mechanical Bar Screens 33,421 10,026 23,395 8 Grit Removal 9 Primary Sedimentation 30 Disinfection 282,757 282,757 11 Aeration Equipment 124,523 (1) 62,262 62,262 12 Sludge Handling 83,361 (1) 45,849 37,513 13 Other Plant and Misc Equipment 68,718 36,464 15,852 36,402 14 General Treatment 935,042 496,364 215,702 223,176 Sewer Treatment Plant - West 15 Sewage Pumping '17,218 107,606 9,612 16 Mechanical Bar Screens 55,071 4,516 15,167 35,388 17 Grit Removal 135,374 11,101 124,273 18 PrimarySedimentation 397,767 32,617 109,545 255,605 19 Disinfection 41,250 37,868 3,382 20 Aeration Equipment 140,345 1 11,508 64,418 64,418 21 Sludge Handling 2,080,224 170,578 1,050,305 859,341 22 Gther Plant and Misc Equipment 320,819 10,135 26,307 139,767 144,610 23 General Treatment 54,927 1 1,735 4,504 23,929 24,758 24 Sewer Land and Land Rights 4,692 1,415 98 1,833 110 607 629 25 General Plant 166,944 42,443 10,553 54,983 4,094 25,653 26,542 2,385 291 26 Total Net Depreciation Expense 8,259,556 1,336,711 1,025,798 1,768,496 0 278,329 0 1,779,082 0 1,898,312 0 143,565 29,263 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 307 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 14 - Wastewater 2023 Allocation of O&M Expenses 5 5 5 5 S $ 5 5 5 1 Sewer Mains Maintenance 2,527,372 1,030,749 1,496,623 2 Wa-water Treatment Plant 1,930,453 367,405 42,158 747,493 773,396 3 Wa-water Treatment PlanINoland 5,578,707 1,183,574 2,160,139 2,234,994 4 Wastewater Treatment Plant -West 2,025,047 263,578 366,054 784,121 811,293 5 Lift Stations 990,432 990,432 6 Meter Operations (a) 1,716,051 1,716,051 7 Water& Sewer Connections 205,698 205,698 8 Operations and Admmi-tion 1,443,897 194,900 174,975 144,317 20,078 355,990 368,326 165,476 19,835 9 Nl Other O&M C- 1,647,745 222,415 199,678 164,692 22,912 406,249 420,326 188,838 22,635 10 Subtotal 18,065,400 2,438,495 2,189,210 1,805,632 0 251,202 0 4,453,993 0 4,608,336 2,070,365 0 248,168 Less: Other Income Sources 11 Sewer Connection Fees 47,900 47,900 12 Other l ncome sources 671,500 49,206 87,179 71,904 10,003 177,367 183,513 82,446 9,883 13 Subtotal 719,400 49,206 87,179 71,904 0 10,003 0 177,367 0 183,513 82,446 0 57,783 14 Net O&M Expenses 17,346,000 2,389,289 2,102,031 1,733,728 0 241,199 0 4,276,626 0 4,424,823 1,987,918 0 190,386 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 308 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 15 - Wastewater 2023 Units of Service 1,000gal. 1,000ga1. 1,000gal. Pounds Pounds Bills Equiv. Meters (2) + (3) Inside City 1 Residential 1,771,796 1,590,308 3,362,104 5,725,103 4,874,540 429,266 34,346 2 Non -Residential 698,638 250,840 949,478 2,179,024 1,765,193 34,296 5,157 3 Industrial 396,716 88,853 485,569 1,226,169 980,006 252 249 4 Subtotal 2,867,150 1,930,001 4,797,151 9,130,296 7,619,739 463,814 39,752 Outside City Farmington 5 Residential 77,284 77,958 155,242 251,513 216,205 21,806 1,603 6 Non -Residential 12,743 7,448 20,191 40,344 33,395 1,656 157 7 1 ndustria I 8 Subtotal 90,027 85,406 175,432 291,857 249,600 23,462 Greenland 9 Residential 10,633 17,382 28,016 35,993 32,523 5,388 435 10 Non -Residential 2,212 1,830 4,041 7,114 6,020 480 22 11 Industrial 12 Subtotal 12,845 19,212 32,057 43,107 38,543 5,868 Washington County/ Growth Area 13 Residential 4,304 1,893 6,197 13,496 11,019 336 74 14 Non -Residential 67 67 14 28 24 15 Industrial 16 Subtotal 4,304 1,960 6,264 13,510 11,047 360 Johnson 17 Residential 6,479 6,692 13,171 21,119 18,191 1,884 151 18 Non -Residential 28 140 168 114 125 48 18 19 Industrial 20 Subtotal 6,507 6,832 13,339 21,233 18,316 1,932 21 Total Retail 2,974,326 2,036,578 5,010,904 9,478,770 7,918,929 493,504 39,752 Wholesale 22 Elkins 81,017 18,069 99,086 250,391 200,104 24 23 23 West Fork 45,625 10,171 55,796 141,008 112,687 12 23 24 Subtotal 126,642 28,240 154,882 391,399 312,791 36 45 25 Subtotal (Inside City) 2,867,150 1,930,001 4,797,151 9,130,296 7,619,739 463,814 39,752 26 Subtotal (Outside City) 113,683 113,409 227,092 369,707 317,506 31,622 - 27 Subtotal (Wholesale) 126,642 28,240 154,882 391,399 312,791 36 45 28 Surcharge Customers 1,282,742 910,900 29 Total System 3,107,475 2,071,650 5,179,225 21,174,244 9,160,936 495,472 42,258 BLACK & VEATCH I Appendix 2: Wastewater Tables Page 309 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 16 - Wastewater 2023 Unit Cost of Service 5 1,000 gal. 1,000 gal. 1,000 gal. 1p00gal. 1,Owg,l. Pountls Pountls Pountls Pountls Bills E9uiv. Meters Bills Units of Servltt 1 Inside City 4,797,151 4,797,151 4,797,151 4,797,151 9,130,296 9,130,296 7,619,739 7,61%, 463,814 39,752 463,814 2 Outside CYty-1/o Farmington 206,542 206,542 51,660 51,660 469,249 469,249 3.,­ 380,69J 8,196 746 3 Surcharge 175,432 175,432 175,432 291,857 24%, 23,462 1,761 4 Total System 5,1J9,125 5, 0 ,693 5p24,243 4,..,.11 175,432 9,.1,4.2 9,5.9 5 8,250,036 8,1-,436 .5,472 42,258 463,814 Costs of Service Net Operating Expense 5 Total -$ 1],346,000 2,389,289 2,102,031 1,J33,]28 341,199 4,2]6,62fi 4,424,823 1,98J,918 190,386 6 Unit Cost -$/unit 0.. OA2 0.35 1.37 0.39 0.50 4.01 0.41 J Depreciation Expense: Total -$ 8,259,555 1,336,J 1,025,]98 1,7.,496 278,329 1,779,082 1,89$312 $ 143,565 2%263 8 -Cort-$/unit 0.26 121 0.35 1.59 .16 0.21 $ 3.3974 0.06 9 Net Plan[ Investment: Total-$ 199,.5,.2 51,.6,392 12,372,823 66,258,665 4,89J,501 30,5]Sp64 31,638,096 2,766,281 33],622 10 Unit Cort-$/unit 9.88 2.47 13.19 27.92 2.81 3.55 65A6 0.73 11 Return on Imvertmem Inside City, U nit Return -$/unit (0.04) (0.01) (O.06) (0.01) (0.02) (0.18) (0.00) 12 cept Farmin Outside City - Exgton - Unit Return-$/U nil 11 0.17 0.92 0.20 0.25 4.58 13 Outside City - Farmington - Unit Return -$/Unit 0.54 0.73 $15354 3.60 14 Total Return Inside City -$ (]82,136) (200,302) (50,154) (267A84) (123,713) (128,054) (11,002) (1,427) 15 Outside City- Except Farmington -$ 416,547 .2,779 35,751 47,689 92,299 94,612 3,417 16 Outside City - Farningtom -$ 498,234 95,286 127,246 269,363 6,339 17 Total Return -$ 132,645 37,764 (14,.3) (92,549) 269,363 (31,414) (33,442) (1,247) (1,427) Total Unit Cort of Service 18 Inside City $/unit 0.68 0.61 0.64 0.54 0.69 4.01 3.12 0.47 19 outside City (En Farnimgto,y$/um 1.41 0.80 1.62 0.]5 0.96 4.01 ].98 20 outside City -Farmington-$/unit 1.26 1.42 $ 4,4968 4.01 7.00 Total Cost of Service 21 Inside Cit, Retail-$ 21,743,660 3,250,896 2,948,565 3,076,442 4,912,298 5,292,288 1,860,902 124,048 218,221 22 Inside City -Surcharge-$ 1,331,238 698,572 632,665 23 Outside Ciry-Ex<ep[Farmington-$ 1,296,928 291,3]0 164,861 83,J00 353p24 364,J39 32,884 5,95o 24 Outside City-Fartnin¢on-$ 1,366,3]4 22149] 249,534 788,891, 94,133 12,320 25 Total cost of service-$ 25,738,200 3,763,70 3,113,426 3,409,676 0 780,890 0 6,024,294 0 6,289,693 1,907,918 142,318 218,nl Table S - 17 - Wastewater 2023 Cost of Service by Customer Class Inside City 1 Residential 15,035,955 17,013,006 -11.6% 2 Non -Residential 4,418,463 3,926,109 12.5% 3 Industrial 2,289,243 1,890,075 21.1% 4 Subtotal 21,743,660 22,829,190 -4.8% Outside City 5 Residential 1,543,180 1,258,314 22.6% 6 Non -Residential 183,028 160,409 14.1% 7 Industrial 100.0% 8 9 Subtotal Total Retail 1,726,208 23,469,868 1,418,723 24,247,913 21.7% -3.2% 10 Wholesale 937,095 655,689 42.9% 11 Surcharge 1,331,238 834,607 59.5% 12 Total 25,738,201 25,738,209 0.0% BLACK & VEATCH I Appendix 2: Wastewater Tables 11-10 Page 310 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 18 - Wastewater Proposed 2023 Charges Existing Wastewater Rates Ettective January 1, ZOZZ Inches 5/8 3/4 1 $/month 18.28 18.28 23.74 $/month 18.28 18.28 33.92 $/month 16.74 16.74 31.28 11/2 38.77 60.37 55.50 2 55.43 79.73 73.45 3 128.73 184.24 169.29 4 212.13 303.44 278.93 6 420.39 601.46 553.70 8 628.73 899.76 826.81 1,000 gal. 1,000 gal. 1,000 gal. 1,000 gal Residential First 2,000 Gallons 4.35 > 2,000 Gallons 5.80 All Usage 8.18 7.52 Non -Residential All Usage 4.40 8.18 7.52 Major Industrial All Usage 4.71 8.18 7.52 Wholesale 85% of metered water usage 5.19 Above 85% of metered water 2.71 Surcharge BOD - $/Ib for strength in excess of 300 ppm 0.4352 TSS - $/Ib for strength in excess of 300 ppm 0.3056 BLACK & VEATCH I Appendix 2: Wastewater Tables Proposed Wastewater Rates Effective January 1, 2023 Inches 5/8 3/4 $/month 18.28 18.28 $/month 18.28 18.28 $/month 25.10 25.10 1 23.74 33.92 52.62 11/2 38.77 66.73 109.78 2 55.43 93.11 154.24 3 128.73 196.10 327.83 4 212.13 303.44 482.37 6 420.39 601.46 897.30 8 628.73 899.76 998.92 Monthly Volume Charge • .- Water Usage 1,000 gal. 1,000 ga I. 1,000 ga I. 1,000 ga I. Residential First 2,000 Gallons 3.39 _ > 2,000 Gallons 4.52 All Usage 8.55 8.27 Non -Residential All Usage 5.10 8.55 8.27 Major Industrial All Usage 5.71 8.55 8.27 Wholesale 85% of metered water usage 7.20 Above 85% of metered water 7.20 Surcharge BOD - $/lb for strength in excess of 300 ppm 0.5426 TSS - $/Ib for strength in excess of 300 ppm 0.6921 Page 311 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table S - 19 - Wastewater 2023 Cost of Service Under Proposed Rates s s s s Inside City 1 Residential 15,036,000 17,013,000 -11.6% 15,049,500 100% -12% -1,963,500 2 Non -Residential 4,418,500 3,926,100 12.5% 4,424,800 100% 13% 498,700 3 Industrial 2,289,200 1,890,100 21.1% 2,291,500 100% 21% 401,400 4 Subtotal 21,743,700 22,829,200 -4.8% 21,765,800 100% -5% -1,063,400 Outside City 5 Residential 1,543,200 1,258,300 22.6% 1,510,400 98% 20% 252,100 6 Non -Residential 183,000 160,400 14.1% 193,500 106% 21% 33,100 7 Industrial 0% 0% 8 Subtotal 1,726,200 1,418,700 21.7% 1,703,900 99% 20% 285,200 Wholesale 9 Elkins 599,500 419,500 42.9% 583,300 97% 39% 163,800 10 West Fork 337,600 236,200 42.9% 328,500 97% 39% 92,300 11 Subtotal 937,100 655,700 42.9% 911,800 97% 39% 256,100 12 Surcharge 1,331,200 834,600 59.5% 1,326,400 100% 59% 491,800 13 Total 25,738,200 25,738,200 0.0% 25,707,900 100% 0% -30,300 Table S - 20 - Wastewater 2023 Bill Impact Line No. Residential 1 Meter Sue Inches 3/4 Monthly Usage 1,000 ga 1. 0.5 1,istlo, Rates $ 22.10 ln,id, City Pr,p ... I Rates $ 19.98 I" c,,,,, increase Decrease $ -2.13 Decrease -9.6% Existing Rates $ 26.46 Outside Proposed Rates $ 22.56 City Increase increase Decrease $ -3.91 Decrease -14.8% 2 3/4 2 26.45 25.06 -1.39 -5.3% 34.64 35.38 0.74 2.1% 3 3/4 4 38.05 31.84 -6.21 -16.3% 51.00 52.48 1.48 2.9% 4 3/4 8 61.25 45.40 -15.85 -25.9% 83.72 86.68 2.96 3.5% 5 3/4 10 72.85 52.18 -20.67 -28.4% 100.08 103.78 3.70 3.7% 6 3/4 15 101.85 69.13 -32.72 -32.1% 140.98 146.53 5.55 3.9% Non -Residential 7 3/4 30 61.75 69.28 7.53 12.2% 100.08 103.78 3.70 3.7% 8 3/4 20 105.75 120.28 14.53 13.7% 181.88 189.28 7.40 4.1% 9 1 50 243.05 278.74 35.69 14.7% 442.92 461.42 18.50 4.2% 30 1 100 463.05 533.74 70.69 15.3% 851.92 888.92 37.00 4.3% 11 11/2 50 257.64 293.77 36.13 14.0% 469.37 494.23 24.86 5.3% 12 11/2 100 477.64 548.77 71.13 14.9% 878.37 921.73 43.36 4.9% 13 2 100 493.82 565.43 71.61 14.5% 897.73 948.11 50.38 5.6% 14 2 Soo 2,253.82 2,605.43 351.61 15.6% 4,169.73 4,368.11 198.38 4.8% Industrial 15 2 100 493.52 626.43 132.91 26.9% 897.73 948.11 50.38 5.6% 16 2 1,000 4,732.52 5,765.43 1,032.91 21.8% 8,259.73 8,643.11 383.38 4.6% 17 4 500 2p41.89 3,067.13 625.24 25.6%1 4,393.44 4,578.44 185.00 4.2% 18 4 1,500 7,151.89 8,777.13 1,625.24 22.7%1 12,573.44 13,128.44 555.00 4.4% 19 6 2,500 11,948.78 14,695.39 2,746.61 23.0%1 21,051.46 21,976.46 925.00 4.4% 20 6 5,000 23,723.78 28,970.39 5,246.61 22.1%1 41,501.46 43,351.46 1,850.00 4.5% 21 6 10,000 47,273.78 57,520.39 10,246.61 21.7%1 82,401.46 86,101.46 3,700.00 4.5% BLACK & VEATCH I Appendix 2: Wastewater Tables 11-12 Page 312 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study 12.0 Appendix 3: Combined Tables Table C - 1 - Combined Projected Fund Balances S $ S $ $ S Operating Funds 1 O&M Reserve Balance (a) 8,051,900 8,314,600 8,586,100 8,866,600 9,156,600 9,456,300 2 Operating Fund Balance (b) 209,600 213,100 210,900 215,500 228,600 212,100 3 Subtotal Operating Funds Balance (e) 8,261,500 8,527,700 8,797,000 9,082,100 9,385,200 9,668,400 Capital Funds 4 Capital Fund Balance (c) 1,008,700 1,008,400 1,006,100 1,010,300 1,009,800 1,003,200 5 Capital Reserve Fund Balance (d) 32,910,000 30,173,000 27,293,500 20,118,500 13,458,500 7,996,500 6 Subtotal Capital Funds Balance (e) 33,918,700 31,181,400 28,299,600 21,128,800 14,468,300 8,999,700 7 Impact Fee Fund Balance (e) 4,460,597 4,516,397 4,378,897 5,592,597 6,791,197 8,511,397 (a) Calculated as 90 days of following year's Operating Expenses. (b) Target minimum combined balance is $200,000 to account for any adjustments that may be needed to the O&M balance at the end of the year. (c) Target minimum combined balance is $1,000,000. (d) Does not include expenses associated with facilities master plan to be completed in FY 2022 (e) All balances are cumulative. BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-1 Page 313 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table C - 2 - Combined Operating Cash Flow Revenues Revenues Under Existing Rates 45,648,500 47,229,500 47,826,000 48,433,700 49,053,000 49,684,500 2 Revenue Increases 0.0 % Increase Effective January 1, 2022 0 0 0 0 0 3 0.0 % Increase Effective January 1, 2023 0 0 0 0 0 4 3.0 % Increase Effective January 1, 2024 0 0 1,331,900 1,471,600 1,490,500 5 6 3.0 % Increase Effective January 3.0 % Increase Effective January 1, 2025 1, 2026 0 0 0 0 0 0 1,389,400 0 1,535,300 1,449,500 7 8 Total Revenue from Rates Other Revenues (a) 45,648,500 47,229,500 1,127,800 1,362,000 47,826,000 1,363,600 49,765,600 1,371,400 51,914,000 1,380,000 54,159,800 1,389,300 9 Subtotal Revenues 46,776,300 48,591,500 49,189,600 51,137,000 53,294,000 55,549,100 10 Expenses Operating Expenses 31,624,500 32,655,200 33,720,300 34,821,200 35,959,000 37,135,100 11 Bad Debt 228,200 236,100 239,100 248,800 259,600 270,800 12 PILOT 1,940,000 2,007,200 2,032,600 2,115,100 2,206,400 2,301,800 13 14 SDWF-Reimbursement to ADPH Debt Service 230,000 0 233,800 0 237,800 0 241,800 0 245,900 0 250,200 0 15 Total Expenses 34,022,700 35,132,300 36,229,800 37,426,900 38,670,900 39,957,900 Transfers 16 Transfer to Shop Fund 66,000 0 0 0 0 0 17 Transfer to Operating Reserve 254,100 262,700 271,500 280,500 290,000 299,700 18 Cash Financing of Capital 11,730,000 15,930,000 15,570,000 20,600,000 20,980,000 20,770,000 19 Transfer to/from Capital Reserve 700,000 -2,737,000 -2,879,500 -7,175,000 -6,660,000 -5,462,000 20 Total Transfers 12,750,100 13,455,700 12,962,000 13,705,500 14,610,000 15,607,700 Fund Balance 21 Beginning Balance 206,100 209,600 213,100 210,900 215,500 228,600 22 Annual Operating Balance 3,500 3,500 -2,200 4,600 13,100 -16,500 23 Ending Fund Balance 209,600 213,100 210,900 215,500 228,600 212,100 Performance Metrics 24 Debt Service Coverage NA NA NA NA NA NA 25 O&M Reserve Balance (Days)(b) O 90.00 0 90.00 a 90.00 a 90.00 :..: 90.00 (, o 90.00 (a) Includes interest income on operating fund balance. (b) Mininum requirement is 90 days of following year's Operating Expenses. BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-2 Page 314 of 425 Revised Draft 06/08/2022 City of Fayetteville, Arkansas I Water and Wastewater Comprehensive Rate Study Table C - 3 - Combined 2023 Bill Impact Line No. Meter Residential 1 Size Inches 3/4 Monthly Usage 1,000gal. 0.5 Existing Rates $ 32.01 Inside Proposed Rates $ 28.22 City Increase / Decrease $ -3.80 Increase Decrease -11.9% Existing Rates $ 37.82 Outside Proposed Rates $ 32.33 City Increase / Decrease $ -5.49 Increase Decrease -14.5% 2 3/4 2 39.87 38.25 -1.62 -4.1% 50.04 51.86 1.82 3.6% 3 3/4 4 60.77 53.57 -7.20 -11.8% 77.10 80.78 3.68 4.8% 4 3/4 8 102.57 84.21 -18.36 -17.9% 131.22 138.62 7.40 5.6% 5 3/4 10 123.47 99.53 -23.94 -19.4% 158.28 167.54 9.26 5.9% 6 3/4 15 175.72 137.83 -37.89 -21.6% 225.93 239.84 13.91 6.2% Non -Residential 7 3/4 10 106.05 115.17 9.12 8.6% 151.20 161.82 10.62 7.0% 8 3/4 20 187.95 205.47 17.52 9.3% 276.80 297.82 21.02 7.6% 9 1 50 441.42 484.38 42.96 9.7% 672.13 726.18 54.05 8.0% 10 1.5 100 872.11 957.70 85.59 9.8% 1,334.15 1,450.95 116.80 8.8% 11 2 500 4,091.34 4,593.63 502.29 12.3% 6,289.61 6,926.63 637.02 10.1% Industrial 12 2 100 812.04 963.63 151.59 18.7% 1,260.25 1,330.63 70.38 5.6% 13 2 1,000 7,715.04 8,928.63 1,213.59 15.7% 11,682.25 12,166.63 484.38 4.1% 14 4 1,500 1 11,678.78 13,576.63 1,897.85 16.3%1 17,760.33 18,466.37 706.04 4.0% 15 6 5,000 1 38,697.56 44,849.38 6,151.82 15.9%1 58,675.24 61,007.28 2,332.04 4.0% 16 6 10,000 1 77,047.56 89,099.38 12,051.82 15.6%1 116,575.24 121,207.28 4,632.04 4.0% BLACK & VEATCH I APPENDIX 3: COMBINED TABLES 12-3 Page 315 of 425 CITY OF FAYETTEVILLE ARKANSAS CITY OF FAYETTEVILLE, ARKANSAS Notice of Public Hearing on Proposed Water and Sewer Rate Changes City Council Agenda Session: Tuesday, June 14, 2022 at 4:30 PM City Council Meeting: Tuesday, June 21, 2022 at 5:30 PM City of Fayetteville Administration Building, City Hall 113 W. Mountain — Room 219 or via Zoom link at www.favetteville-ar.gov The City of Fayetteville AR, on the dates and times mentioned above, will hold a public hearing as part of the City Council Agenda Session and City Council Meeting with Fayetteville City Council prior to the adoption of the 2023 water and sewer rate increases. The public can attend in person or remotely via the link on the City's website, www.favetteville-ar.gov. If adopted, the proposed new rates would take effect on or after January 01, 2023, with 3% increases annually thereafter. All property owners/tenants and other interested parties are invited to attend the public hearing and be heard on the matter. A water and sewer cost of service study was conducted by Black & Veatch pursuant to Fayetteville City Council Resolution 212-20 to perform a cost analysis to determine if costs allocations are fair and equitable among customer classes, to review the existing rate structure and design proposed rates that provide adequate revenues. The rate study was conducted following the industry standard methodology from the American Water Works Association (M1 Principles of Water Rates, Fees, and Charges). The proposed water and sewer rate changes below are necessary for the City of Fayetteville to continue to provide safe and reliable water and sewer services to its citizens because extensive new capital needs are required at this point in time and operating costs have increased above the revenue increases generated by the current annual 3% proportional adjustment. Page113 Page 316 of 425 PROPOSED WATER RATE CHANGES - ON OR AFTER 11112023 FIXED BASE CHARGE • OUTSIDE Meter Size 5/8" 3/4" EXISTING PROPOSED CHANGE EXISTING PROPOSED 6.59 6.59 0.0% 7.54 7.54 0.0% 6.59 6.59 0.0% 7.54 7.54 0.0% 1" 9.14 9.14 0.0% 10.52 12.26 16.5% 1.5" 15.93 15.93 0.0% 18.31 24.22 32.3% 2" 23.20 23.20 0.0% 26.66 33.52 25.7% 3" 54.05 54.05 0.0% 62.18 69.84 12.3% 4" 89.50 89.50 0.0% 102.93 102.93 0.0% 6" 8" QUANTITY CHARGE000 GALLONS Residential First 2,000 gallons 178.99 178.99 0.0% 205.82 205.82 0.0% 268.41 268.41 0.0% 308.67 308.67 0.0% AVG 0.0% 3.51 3.30 -6.0% AVG 4.04 4.47 9.7% 10.6% Next 13,000 gallons 4.64 4.37 -5.8% 5.34 5.91 10.7% All over 15,000 gallons 6.59 6.20 -5.9% 7.54 8.38 11.1% "First300,000 gallons 3.79 AVG 3.93 -5.9% 3.7% 4.38 AVG 5.05 10.8% 15.3% All over 300,000 gallons 3.38 3.93 16.3% 3.90 5.05 29.5% All Usage First 300,000 gallons 2.96 5.04 AVG 3.14 4.29 10.0% 6.1% -14.9% 3.20 5.80 AVG 3.49 5.43 22.4% 9.1% -6.4% All over 300,000 gallons 4.53 4.29 -5.3% 5.22 5.43 4.0% "M Reduced Peak Demand AVG -10.1% 2.87 AVG 3.16 -1.2% 10.1% Peak Demand 3.20 3.16 -1.3% 4- AVG 4.4% *Beginning January 1, 2024, all monthly water rates shall be increased by 3% per year Page213 Page 317 of 425 PROPOSED SEWER RATE CHANGES - ON OR AFTER 11112023 FIXED BASE • Meter SizeEXISTING 5/8" 3/4" 18.28 PROPOSED 18.28 CHANGE 0.0% EXISTING 18.28 PROPOSED 18.28 CHANGE 0.0% EXISTING 16.74 PROPOSED 25.10 49.9% 18.28 18.28 0.0% 18.28 18.28 0.0% 16.74 25.10 49.9% 1" 23.74 23.74 0.0% 33.92 33.92 0.0% 31.28 52.62 68.2% 1.5" 38.77 38.77 0.0% 60.37 66.73 10.5% 55.50 109.78 97.8% 2" 55.43 55.43 0.0% 79.73 93.11 16.8% 73.45 154.24 110.0% 3" 128.73 128.73 0.0% 184.24 196.10 6.4% 169.29 327.83 93.6% 4" 212.13 212.13 0.0% 303.44 303.44 0.0% 278.93 482.37 72.9% 6" 420.39 420.39 0.0% 601.46 601.46 0.0% 553.70 897.30 62.1% 8" • 000 GALLONS ��sidentialppr First 2,000 Gallons All over 2,000 Gallons 628.73 628.73 0.0% 899.76 899.76 0.0% 826.81 998.92 20.8% AVG 0.0% 4.35 3.39 -22.1% AVG 3.8% 8.18 8.55 4.5% AVG 7.52 8.27 69.5% 10.0% 5.80 4.52 -22.1% 8.18 8.55 4.5% 7.52 8.27 10.0% AVG -22.1% AVG 4.5% AVG 10.0% 5All Usage ajor Industrial _ All Usage Wholesal 4.40 5.10 15.9% 8.18 8.55 4.5% 7.52 8.27 10.0% 4.71 5.71 21.2% 8.18 8.55 4.5% 7.52 8.27 10.0% 5.19 7.20 38.7% Reduced Peak Demand Peak Demand 2.71 7.20 165.7% AVG 102.2% *Beginning January 1, 2024, all monthly sewer rates shall be increased by 3% per year For more information or questions about the proposed water and sewer rate changes, contact the City of Fayetteville, Utilities Financial Services Division at (479) 575-8224 or visit the City's website for at www.fayettevi I le -a r.gov. City of Fayetteville, Arkansas By: Tim Nyander Water & Sewer Utilities Director Date: 06/08/2022 Page313 Page 318 of 425 DEPARTMENTAL CORRESPONDENCE OFFICE OF THE CITY ATTORNEY TO: Mayor Jordan City Council Kara Paxton, City Clerk/ Treasurer CC: Susan Norton, Chief of Staff Paul Becker, Chief Financial Officer Tim Nyander, Utilities Director FROM: Kit Williams, City Attorne ' DATE: July 15, 2022 RE: Statutory Procedure Required For Adopting New Sewer Rates Kit Williams City Attorney Blake Pennington Assistant City Attorney Jodi Batker Paralegal There is a precise and unusual procedural schedule that is required by A.C.A. §14-235-223 Rates and charges for services - Lien for sewer rate changes. Prior to raising or changing sewer rates, the City must carefully follow every statutorily required step pursuant to A.C.A. §14-235-223 as shown below: "(d)(1)(A) No rates or charges shall be established until after a public hearing, at which all the users of the works and owners of property served or to be served by them and others interested shall have opportunity to be heard concerning the proposed rates or charges. (B) After introduction of the ordinance fixing the rates or charges, and before the ordinance is finally enacted, notice of the hearing, setting forth the proposed schedule of the rates or charges, shall be given by one (1) publication in a newspaper published ... at least ten (10) days before the date fixed in the notice for the hearing, which may be adjourned from time to time. (2) After the hearing the ordinance establishing rates or charges, either as originally introduced or as modified and amended, shall be passed and put into effect." Page 319 of 425 Statutorily Required Schedule (1) Introduce (Read) the ordinance proposing to change the sewer rates at a City Council meeting; (2) Publish "notice of the hearing setting forth the proposed schedule of the rates and charges ... by one publication in a newspaper..." (3) This notice must be published "at least ten (10) days before the date fixed in the notice for the hearin " g... (4) After this public hearing, the ordinance may be passed. The sewer rate ordinance will be read for the first time (introduced) at the June 21st City Council Meeting. After such introduction (reading), the City needs to set the date of the public hearing no earlier than ten (10) days from date such notice can be published (which might be Sunday, June 26, or if that cannot be accomplished, then Sunday July 3rd). Ten days after either publication date would allow the public hearing to be held at the July 19th City Council Meeting and the ordinance acted upon at that meeting after the Public Hearing. As you see, the currently scheduled Public Hearing for next Tuesday does not fulfill the statutory requirement for such Public Hearing because the ordinance must be introduced (read) BEFORE the public hearing is even scheduled. Then the notice of such public hearing date must be published in the paper. Such notice must also set "forth the proposed schedule of the rates and charges" as well as the date of the public hearing. Since the City has scheduled a public hearing for the next City Council Meeting, we may still wish to conduct one, but it will not suffice for our statutory requirement. The very first requirement is the reading of the ordinance which statutorily begins the full process which we must accomplish before the ordinance can be passed. The Agenda for the June 21st City Council Meeting needs to have the sewer rate change ordinance as an item of New Business where it will be placed on its first reading. Since all such items of New Business allow public comment, persons wishing to speak to the proposed rate changes can publicly comment then so we do not need a separate public hearing on the June 21st Agenda. During the discussion of the sewer rate ordinance, the Council needs to agree that the Public Hearing will be scheduled for the July 19th City Council Meeting. 0) Page 320 of 425 34' bonds dcipa listir--- r vice -ceeds iinir., r the ty be g the f any to be v the fonds and the 'd to ds of .ture ured gate pro- nen- any rtic- from tuff, 'were unt. t, it t of for :far MUNICIPAL SEWAGE SYSTEMS 14-235-223 ..ore than such sum turned over to it in ..aiutaining the system, the city having m-an operating and maintaining this sys- '--rn out of general revenues with no ex- -nses to the district, and the desire for audit of the accounts was made after the etirement of the bonds issued for the maintenance of the sewer. Lawrence v. -'Dnes, 228 Ark. 1136, 313 S.W.2d 228 1958). Scope. This section contemplates that revenue ponds authorized to construct sewers will be paid from the revenues derived from that service and nothing in this subchap- ter authorizes any part of the revenues derived from the system to be devoted and appropriated to pay the cost of construc- tion or operation of waterworks system. Mathers v. Moss, 202 Ark. 554, 151 S.W.2d 660 (1941). 14-235-223. Rates and charges for services — Lien. (a)(1) The council of the municipality shall have power, and it shall be its duty, by ordinance to establish and maintain just and equitable rates or charges for the use of and the service rendered by the works, to he paid by each user of the sewerage system of the municipality. (2) The council may change and readjust the rates or charges from rime to time to such extent as will not render insecure the rights of the holders of revenue bonds or violate; any sinking fund agreement, or other lawful agreement, with such bondholders. (b) The rates or charges shall be sufficient in each year for the payment of the proper and reasonable expense of operation, repair, replacements, and maintenance of the works and for the payment of the sums required in this subchapter to be paid into the sinking fund. (c) Revenues collected pursuant to this section shall be deemed the re nues of the works. (d)(1)(A) No rates or charges shall be established until after a public hearing, at which all the users of the works and owners of property served or to be served by them and others interested shall have opportunity to be heard concerning the proposed rates or charges. (B) After introduction of the ordinance fixing the rates or charges, and before the ordinance is finally enacted, notice of the heaving, setting forth the proposed schedule of the rates or charges, shall be given by one (1) publication in a newspaper published in the munic- ipality if there is such a newspaper, but otherwise in a newspaper having general circulation in the municipality, at least ten (10) days before the date fixed in the notice for the hearing, which may be adjourned from time to time. (2) After the hearing the ordinance establishing rates or charges, either as originally introduced or as modified and amended, shall be passed and put into effect. r (e) A copy of the schedule of the rates and charges established shall be kept on file in the office of the sewer committee having charge of the operation of the works, and also in the office of the municipal clerk or recorder, and shall be open to inspection by all parties interested. (f)(1) The rates or charges so established for any class of users or property served shall be extended to cover any additional premises Page 321 of 425 Paxton, Kara From: Paxton, Kara Sent: Tuesday, June 14, 2022 5:07 PM To: Bolinger, Bonnie; Pennington, Blake; Brown, Chris; Bunch, Sarah; CityClerk; Curth, Jonathan; Harvey, Sonia; Hertzberg, Holly; Batker, Jodi; Jones, D'Andre; Kelley, Courtney; Kinion, Mark; Johnson, Kimberly; Rogers, Kristin; Williams, Kit; Jordan, Lioneld; Mathis, Jeana; Paxton, Kara; Mulford, Patti; Rea, Christine; Scroggin, Sloan; Norton, Susan; Thurber, Lisa; Turk, Teresa; Wiederkehr, Mike Subject: FW: Pre -Agenda Meeting Good afternoon, The Public Hearing item C.1 Public Hearing Discussion on Recommendations for Water and Sewer Rates Effective January 1, 2023 on the 06/14/2022 Tentative Agenda was placed on the agenda per the request I received via email on Wednesday, June 8, 2022 2:23 PM. Based on the City Attorney requesting that this item now be moved the below email will be placed as additional documents in the agenda packet. Thank you, Kara Paxton, MSISM, CMC, CMO City Clerk Treasurer City of Fayetteville, Arkansas kapaxton(.. fayetteville-ar. gov T 479.575.8323# VIFIr OF From: Norton, Susan <snorton@fayetteville-ar.gov> Sent: Thursday, June 9, 2022 3:12 PM To: Paxton, Kara <kapaxton@fayetteville-ar.gov> Subject: RE: Pre -Agenda Meeting Thank you! From: Paxton, Kara <kapaxton@favetteville-ar.gov> Sent: Thursday, June 9, 2022 3:02 PM To: Norton, Susan <snorton@favetteville-ar.gov> Subject: RE: Pre -Agenda Meeting I processed the change and uploaded the document. The agenda can be viewed at the below link. https://accessfayetteville.granicus.com/GeneratedAgendaViewer.php?view id=14&event id=2591 Page 322 of 425 Thank you, Kara Paxton, MSISM, CMC, CMO City Clerk Treasurer City of Fayetteville, Arkansas kapaxton(&fayetteville-ar. gov T 479.575.8323# rdI T T OF IFAVOTTCTILLC From: Norton, Susan <snorton@fayetteville-ar.gov> Sent: Wednesday, June 8, 2022 4:07 PM To: Paxton, Kara <kapaxton@fayetteville-ar.gov>; Williams, Kit <kwilliams@fayetteville-ar.gov>; Thurber, Lisa <Ithurber@fayetteville-ar.gov>; Curth, Jonathan <jcurth@fayetteville-ar.gov>; Brown, Chris <cbrown@fayetteville- ar.gov>; Becker, Paul <pbecker@fayetteville-ar.gov> Cc: Rogers, Kristin <krogers@fayetteville-ar.gov>; Bolinger, Bonnie <bbolinger@fayetteville-ar.gov> Subject: RE: Pre -Agenda Meeting Kara - Please add the following descriptor to that Public Hearing title and include the attached as a link in the packet. Please let me know if you have any questions. Public Hearing: Discussion on Recommendations for Water and Sewer Rates Effective January 1, 2023 Thank you. Susan From: Paxton, Kara <kapaxton@fayetteville-ar.gov> Sent: Wednesday, June 8, 2022 3:37 PM To: Williams, Kit <kwilliams@fayetteville-ar.gov>; Thurber, Lisa <Ithurber@fayetteville-ar.gov>; Norton, Susan <snorton@fayetteville-ar.gov>; Curth, Jonathan <jcurth@fayetteville-ar.gov>; Brown, Chris <cbrown@fayetteville- ar.gov>; Becker, Paul <pbecker@fayetteville-ar.gov> Cc: Rogers, Kristin <krogers@fayetteville-ar.gov>; Bolinger, Bonnie <bbolinger@fayetteville-ar.gov> Subject: RE: Pre -Agenda Meeting Kit, Thank you for your response. I have added the Public Hearing section and moved the item you mentioned. I have attached a copy of the agenda to this email for your records. This agenda will be published on the website tomorrow afternoon. Thank you, Kara Paxton, MSISM, CMC, CMO City Clerk Treasurer Page 323 of 425 City of Fayetteville, Arkansas kapaxtongfayetteville-ang_ov T 479.575.8323# ci r Of PAV■Tr■VILL■ From: Williams, Kit <kwilliams@favetteville-ar.gov> Sent: Wednesday, June 8, 2022 2:23 PM To: Paxton, Kara <kapaxton@favetteville-ar.gov>; Thurber, Lisa <Ithurber@favetteville-ar.gov>; Norton, Susan <snorton@favetteville-ar.gov>; Curth, Jonathan <jcurth@favetteville-ar.gov>; Brown, Chris <cbrown@fayetteville- ar.gov>; Becker, Paul <pbecker@favetteville-ar.gov> Subject: RE: Pre -Agenda Meeting Kara, Looks very good to me. We need to have a separate place for a public hearing on the new water/sewer rates (before item for the ordinance.). Kit From: Paxton, Kara Sent: Wednesday, June 08, 2022 12:31 PM To: Thurber, Lisa <Ithurber@favetteville-ar.gov>; Norton, Susan <snorton@favetteville-ar.gov>; Curth, Jonathan <icurth@favetteville-ar.gov>; Brown, Chris <cbrown@favetteville-ar.gov>; Becker, Paul <pbecker@favetteville-ar.gov>; Williams, Kit <kwilliams@favetteville-ar.gov> Cc: Bolinger, Bonnie <bbolinger@favetteville-ar.gov>; Rogers, Kristin <krogers@favetteville-ar.gov> Subject: Pre -Agenda Meeting Good afternoon, I have attached the draft version of the Tentative Agenda. Once you have had a chance to review this document please email me and let me know what your agenda item preferred order is for the Consent Agenda and New Business. Thank you, Kara Paxton, MSISM, CMC, CMO City Clerk Treasurer City of Fayetteville, Arkansas kapaxtonn favetteville-an gov T 479.575.8323# CITY Of PAV■Tr■VILL■ Page 324 of 425 Received by City Attorney 7/13/22, 10:28 AM DEPARTMENTAL CORRESPONDENCE OFFICE OF THE CITY ATTORNEY Kit Williams City Attorney TO: Ma Jordan Blake Pennington Mayor an y J Assistant City Attorney City Council Jodi Batker Kara Paxton, City Clerk/ Treasurer Paralegal CC: Paul Becker, Chief Financial Officer Tim Nyander, Utilities Director Corey Granderson, Utilities Engineer FROM: Kit Williams, City Attorney L� DATE: July 13, 2022 RE: Contracting with other political subdivisions The City of Fayetteville has constructed a very efficient and effective wastewater system for our residents, businesses, and factories which we have graciously allowed residents and businesses outside our city limits to access for decades. The City is authorized to contract with other cities or their residents (Elkins, Greenland, Farmington, Johnson, and West Fork) by A.C.A. §14-235-212 Contracting with other political subdivisions. These contracts are statutorily authorized, "but only to the extent of the capacity of the works without impairing the usefulness of them to the owners (Fayetteville), upon such terms and conditions as may be fixed by the sewer committee..." Id. at (a)(1)(B). (emphasis added) In a sewer rate challenge case, the Arkansas Supreme Court held: "Rate making being a legislative act, unless the city council has acted arbitrarily and unreasonably in fixing these rates, there is a prima facie presumption in favor of their correctness, and the burden is on complainant to show otherwise." Lazurence v. Jones, 228 Ark. 1136, 313 S.W. 2d. 228, 231 (1958). Page 325 of 425 In a recent case, the City of Fayetteville was sued because it substantially increased its rates to a nonresident wholesale water customer. "Water may be supplied to nonresident consumers at such rates as the legislative body of the municipality may deem just and reasonable, and the rates need not be the same as the rates charged residents of the municipality." Mount Olive Water Association v. City of Fayetteville, 313 Ark, 606, 856 S.W. 2d 864, 866 (1993). The water association challenged a 9.8 % rate of return for computing revenue requirements. Id. The Arkansas Supreme Court rejected the water association's argument that the 9.8% rate of return establishing the water rates was not just or reasonable. The Court ruled: "We have stated no hard and fast rule regarding what constitutes a reasonable rate or the variables properly employed by which a municipality may charge in these situations. Reasonableness of rates must therefore be dictated by the facts of each situation and the definition of 'reasonable' established by the common meaning of the term. Webster's Third New International Dictionary (Unabridged) (1968) gives several definitions of 'reasonable' including 'not conflicting with reason: not absurd: not ridiculous ... b. being or remaining within the bounds of reason."' Mount Olive Water Association v. City of Fayetteville, Supra at 867. The Arkansas Supreme Court cited "the Report on Revenue Requirements, Cost of Service, and Rates for Water and Sewer Services for Fayetteville, Arkansas prepared by Black and Veatch/Engineers - Architects of Kansas City," Id. as 'evidence presented by the City (which) showed the rates were based upon 'reason' and were 'reasonable' in accordance with the dictionary definitions quoted." Id. Although the current Black and Veatch report may need to be slightly modified, once the City Council is satisfied that Black and Veatch has properly considered all relevant factors including realistic and relevant concerns of the City of Farmington and others, rates based upon the Report should satisfy the reasonableness standard here just as they did in the Mount Olive Water 2 Page 326 of 425 Association case. The Court in that case found that the charge per 1000 gallon rate there which more than tripled in four years was reasonable and legal. "The burden of proving the city's rate schedule to be arbitrary and unreasonable rested upon the plaintiffs, for the ordinance is entitled to the presumption of validity that legislative enactments ordinarily receive." Lawrence v. Jones, Supra at 231. CONCLUSION The City of Fayetteville has always strived to fairly apportion the costs of building, maintaining, and operating its water and sewer systems among all of its customers. The law clearly gives the City Council the right to protect the interests of our citizens and businesses by crediting their recent 200 Million Dollar investment into the wastewater system project which was needed to service not only our intown customers, but our many out of town customers in Farmington, Greenland and Johnson as well as our wholesale customers of Elkins and West Fork. A reasonable rate of return from our out-of-town customers to compensate our citizens' 200 Million Dollar investment is not only legal, but fair and reasonable. 3 Page 327 of 425 CITY OF Pow, FAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: FROM: Kit Williams, City Attorney DATE: SUBJECT: CITY COUNCIL MEMO 2023-505 RECOMMENDATION: Council Member Sarah Moore requests City Council approval of a resolution approving the ARPA application of and authorizing Mayor Jordan to sign a subrecipient agreement with Serve NWA d/b/a New Beginnings in the amount of $1,295,000.00 to provide low income residents with housing and other needed support. BACKGROUND: DISCUSSION: BUDGET/STAFF IMPACT: $1,295,000 from the City's ARPA funds ATTACHMENTS: Agenda Request Serve NWA - Sarah Moore, New Beginnings_Resolution-City Attorney Memo, 2023-505 BA ARPA Serve NWA—New Beginnings Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 328 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-505 A RESOLUTION TO APPROVE AND AUTHORIZE MAYOR JORDAN TO SIGN AN ARPA FUNDED SUBRECIPIENT AGREEMENT WITH SERVE NWA FOR SUPPORTIVE OR AFFORDABLE HOUSING IN THE AMOUNT OF $1,295,000.00 AND TO APPROVE A BUDGET ADJUSTMENT WHEREAS, Serve NWA, d/b/a New Beginnings, has long worked to shelter unhoused persons in Fayetteville and submitted an application requesting $1,295,000.00 in American Rescue Plan Act (ARPA) funding to help Fayetteville's lower income residents obtain housing; and WHEREAS, the City Council believes that New Beginnings should receive this ARPA funding to enable low income Fayetteville residents to become better sheltered and to find affordable housing accommodations and other services. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby determines that the ARPA application from New Beginnings meets all requirements of the American Rescue Plan Act (ARPA), approves the ARPA application by Serve NWA (d/b/a New Beginnings) in the amount of $1,295,000.00 to provide low income residents with housing and other needed support, and authorizes Mayor Jordan to sign the Subrecipient Agreement with Serve NWA (d/b/a New Beginnings). Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment in the amount of $1,295,000.00 to pay for the needed services offered by Serve NWA (d/b/a New Beginnings). Page 1 Page 329 of 425 Civic Clerk Item No.: 2023- AGENDA REQUEST FORM FOR: Council Meeting of March 7, 2023 FROM: Council Member Sarah Moore ORDINANCE OR RESOLUTION TITLE AND SUBJECT: A RESOLUTION TO APPROVE AND AUTHORIZE MAYOR JORDAN TO SIGN AN ARPA FUNDED SUBRECIPIENT AGREEMENT WITH SERVE NWA FOR SUPPORTIVE OR AFFORDABLE HOUSING IN THE AMOUNT OF $1,295,000.00 AND TO APPROVE A BUDGET ADJUSTMENT APPROVED FOR AGENDA: r ity Council Member Date Sarah Moore City Attorney it Williams Date Approved as to form Page 330 of 425 Williams, Kit From: Moore, Sarah Sent: Tuesday, February 14, 2023 12:45 AM To: Dotson, Steven; Becker, Paul Cc: Wifliams, Kit Subject: Re. Resolution for 02/28 agenda session: ARPA for Serve NWA housing application Hi Steven and Paul I wanted to touch base with you on the New Beginnings project to purchase units that will be kept as affordable units at some of the most entry level of our population that have experienced chronic homelessness. There has been brought up earlier today the concern of meeting the ARPA guidelines. This is the first time that I understood this project had concerns that it was outside the ARPA parameters. I did understand staff did not recommend it, but in the criteria shared, I did see how it could be possible to not be recommended and still be a viable project. I would not want to entertain doing anything that is not eligible to be done. I and others that I collaborate with have followed ARPA very closely since its launch educating the public on the program and speaking directly with community members on their expectations over the past 2 years. The ARPA program has morphed and changed over time and has mostly been updated in a way that has loosened restrictions and tried to open up the ability for communities to get creative about solving things like affordable housing. In reading the guidance on ARPA and the updated information on affordable housing, I do find that this project can qualify. In all of the projects and reading of ARPA, it seems that a project of this type is allowable. Do you see this any differently? I am attaching some highlights from portions that seem to lend themselves to this project. The biggest factors to consider seem to be making sure that there are income requirements in line with federal housing programs, housing standards, a set time period of affordability. Looking further, it seems like the minimum time frame of affordability is 20 years which the current applicant will be agreeable to. I welcome feedback on how we structure this opportunity so that we are in compliance while also creating the ability to house some of the highest need in our city. 1. Treasury continues to authorize use of ARPA funds to further affordable housing in response to COVID-19. Governments continue to be able to use recovery funds they receive for the "development, repair, and operation of affordable housing and services or programs to increase long-term housing security." For an affordable housing development to qualify for ARPA funding, the project must be responsive and proportional to the negative economic impacts of the pandemic. A development may meet this requirement if it increases the supply of long-term affordable housing for households negatively impacted by the pandemic. Under the revised FAQs, Treasury now presumes that certain projects related to affordable housing investments are eligible uses. This includes projects that are eligible for funding Page 331 of 425 under an expanded list of federal housing programs and projects for the development, repair or operation of affordable rental housing, subject to certain income and affordability requirements. To the extent a project fits into one of the two presumptions further described below, Treasury will presume that the project is eligible. 2. Two presumptively eligible uses of ARPA funds were added to the guidance. Under the new guidance, Treasury expanded eligible affordable housing uses to maximize the availability of ARPA funds for affordable housing projects. First, Treasury will presume that any project eligible for funding under certain federal housing programs is an eligible use of ARPA funding. Previously, the federal programs were limited to the HOME Investment Partnerships Program and the National Housing Trust Fund. The new guidance expands that list to other programs and agencies, including the Low - Income Housing Tax Credit (LIHTC) program, the Public Housing Capital Fund, Section 202 Supportive Housing for the Elderly Program, Section 811 Supportive Housing for Persons with Disabilities Program, project -based rental assistance, and Multifamily Preservation and Revitalization program. For presumptive eligibility related to a federal housing program, a project must comply with the applicable program's requirements regarding (1) income restrictions, (2) the affordability period and related requirements for assisted units, (3) tenant protections and (4) housing quality standards, (NBs would plan to meet this requirement and have full assurance with a contract put in place with City of Fayetteville-) Second, Treasury will presume that an investment in the development, repair or operation of any affordable rental housing unit is an eligible use of ARPA funds if the unit provides affordability for 20 years or more, imposed through a land -use restriction (or similar) agreement, for households at or below 65% of area median income (AMI). Additionally, Treasury does not require that the income limits and 20-year affordability covenant apply to specific units. These limits can instead be used to specify a number of units in the development as long as the applicable covenants specify the bedroom size mix. NBs would plan to meet this requirement and have full assurance with a contract put in place with City of Fayetteville Thankyou Sarah Moore Fayetteville City Council, Ward 2 sarah.moore fa etteville-ar. ov 479.263.6629 From: Moore, SarahEsarah.moore@fayetteville-ar.gov> Date: Monday, February 13, 2023 at 3:44 PM Page 332 of 425 TO: Williams, Kit <kwilliams@fayetteville-ar.gov> Cc: Dotson, Steven <sdotson@fayetteville-ar.gov> Subject: Re: Resolution for 02/28 agenda session: ARPA for Serve NWA housing application I'm happy to have a further conversation to make sure it's legal and can meet the requirements of ARPA. I do believe it can. I do feel the contractural long term affordable definition will have to be worked out. But ARPA does state housing is something that can be done and has been approached with RFP processes in other communities. This is a proven nonprofit that will also offer support for this vulnerable part of our community. I understand that the staff weighed in a certain way and did hear it explained but I respectfully disagree with their assessment on the opportunity. Happy to set up time to talk though to make sure we are fully flushed out on it. Sarah Moore On Feb 13, 2023, at 3:39 PM, Williams, Kit <kwilliams@fayetteville-ar.gov> wrote: Sa ra h, Attached is a draft Resolution as you requested. Although after speaking with Steven Dotson and learning more about this application, I probably need to change the resolution a little. i hope that you are aware that the City Staff rejected this proposal as presented. Steven told me that he discussed this with the Council during your workshop, It may be determined that this proposal may not even be able to pass all ARPA rules. What about the other $777,000.00 to buy the land? Who is going to determine which 6 to 8 families out of the tens of thousands that already live or would like to live in Fayetteville will benefit from free housing? Do you think this is the most effective and efficient use of funds to help the most persons suffering from being unhoused? Kit From: Moore, Sarah <sarah.moore@fayetteville-ar.gov> Sent: Monday, February 13, 2023 8:39 AM To: Williams, Kit <kwilliams@fayetteville-ar.gov> Subject: Resolution for 02/28 agenda session: ARPA for Serve NWA housing application Good Morning Kit, Please see below for language that I have put together to place a resolution for the ARPA nonprofit application that was submitted by Serve NWA ❑BA New Beginnings. i would like to have this available in time for inclusion on the agenda for the agenda session to happen on 02/28/23. Please let me know if there's anything further that I can provide in order to be able to put this forward for this timing. Thanks, Sarah Page 333 of 425 Be OFFICE OF THE CITY ATTORNEY DEPARTMENTAL CORRESPONDENCE TO: Mayor City Council CC: Susan Norton, Chief of Staff Paul Becker, Chief Financial Officer Steven Dotson, Internal Auditor FROM: Kit Williams, City Attorney L-T' DATE: February 27, 2023 Kit Williams City Attorney Blake Pennington Assistant City Attorney Jodi Batker Paralegal RE: Resolution to Approve a $1,295,000 Subrecipient Agreement with New Beginnings for Supportive or Affordable Housing Although Council Member Sarah Moore had approved my final draft of her desired Resolution, I failed to get it onto the Tentative Agenda last week. Therefore, Sarah will need to walk it onto tomorrow"s Agenda Session. Since it cannot get on the agenda until the Agenda Session now, Sarah asked that I provide everyone a copy for your review prior to tomorrow's Agenda Session. I have also attached a portion of Council Member Moore's email outlining why she believes it is a valuable and legal use of ARPA's funds. She will certainly further explain the need for this Resolution and can answer your questions at the Agenda Session. Page 334 of 425 RESOLUTION NO. A RESOLUTION TO APPROVE AND AUTHORIZE MAYOR JORDAN TO SIGN AN ARPA FUNDED SUBRECIPIENT AGREEMENT WITH SERVE NWA FOR SUPPORTIVE OR AFFORDABLE HOUSING IN THE AMOUNT OF $1,295,000.00 AND TO APPROVE A BUDGET ADJUSTMENT WHEREAS, Serve NWA, d/b/a New Beginnings, has long worked to shelter unhoused persons in Fayetteville and submitted an application requesting $1,295,000.00 in American Rescue Plan Act (ARPA) funding to help Fayetteville's lower income residents obtain housing; and WHEREAS, the City Council believes that New Beginnings should receive this ARPA funding to enable low income Fayetteville residents to become better sheltered and to find affordable housing accommodations and other services. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby determines that the ARPA application from New Beginnings meets all requirements of the American Rescue Plan Act (ARPA), approves the ARPA application by Serve NWA (d/b/a New Beginnings) in the amount of $1,295,000.00 to provide low income residents with housing and other needed supports, and authorizes Mayor Jordan to sign the Subrecipient Agreement with Serve NWA (d/b/a New Beginnings). Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment in the amount of $1,295,000.00 to pay for the needed services offered by Serve NWA (d/b/a New Beginnings). PASSED and APPROVED this 7tn day of March, 2023. APPROVED: ATTEST: LIONELD JORDAN, Mayor KARA PAXTON, City Clerk Treasurer Page 335 of 425 Williams, Kit From: Moore, Sarah Sent: Tuesday, February 14, 2023 12:45 AM To: Dotson, Steven; Becker, Paul Cc: Williams, Kit Subject: Re: Resolution for 02/28 agenda session: ARPA for Serve NWA housing application Hi Steven and Paul I wanted to touch base with you on the New Beginnings project to purchase units that will be kept as affordable units at some of the most entry level of our population that have experienced chronic homelessness. There has been brought up earlier today the concern of meeting the ARPA guidelines. This is the first time that I understood this project had concerns that it was outside the ARPA parameters. I did understand staff did not recommend it, but in the criteria shared, I did see how it could be possible to not be recommended and still be a viable project. I would not want to entertain doing anything that is not eligible to be done. I and others that I collaborate with have followed ARPA very closely since its launch educating the public on the program and speaking directly with community members on their expectations over the past 2 years. The ARPA program has morphed and changed over time and has mostly been updated in a way that has loosened restrictions and tried to open up the ability for communities to get creative about solving things like affordable housing. In reading the guidance on ARPA and the updated information on affordable housing, I do find that this project can qualify. In all of the projects and reading of ARPA, it seems that a project of this type is allowable. Do you see this any differently? I am attaching some highlights from portions that seem to lend themselves to this project. The biggest factors to consider seem to be making sure that there are income requirements in line with federal housing programs, housing standards, a set time period of affordability. Looking further, it seems like the minimum time frame of affordability is 20 years which the current applicant will be agreeable to. I welcome feedback on how we structure this opportunity so that we are in compliance while also creating the ability to house some of the highest need in our city. 1. Treasury continues to authorize use of ARPA funds to further affordable housing in response to COVID-19. Governments continue to be able to use recovery funds they receive for the "development, repair, and operation of affordable housing and services or programs to increase long-term housing security." For an affordable housing development to qualify for ARPA funding, the project must be responsive and proportional to the negative economic impacts of the pandemic. A development may meet this requirement if it increases the supply of long-term affordable housing for households negatively impacted by the pandemic. Under the revised FAQs, Treasury now presumes that certain projects related to affordable housing investments are eligible uses. This includes projects that are eligible for funding Page 336 of 425 under an expanded list of federal housing programs and projects for the development, repair or operation of affordable rental housing, subject to certain income and affordability requirements. To the extent a project fits into one of the two presumptions further described below, Treasury will presume that the project is eligible. 2. Two presumptively eligible uses of ARPA funds were added to the guidance. Under the new guidance, Treasury expanded eligible affordable housing uses to maximize the availability of ARPA funds for affordable housing projects. First, Treasury will presume that any project eligible for funding under certain federal housing programs is an eligible use of ARPA funding. Previously, the federal programs were limited to the HOME Investment Partnerships Program and the National Housing Trust Fund. The new guidance expands that list to other programs and agencies, including the Low - Income Housing Tax Credit (LIHTC) program, the Public Housing Capital Fund, Section 202 Supportive Housing for the Elderly Program, Section 811 Supportive Housing for Persons with Disabilities Program, project -based rental assistance, and Multifamily Preservation and Revitalization program. For presumptive eligibility related to a federal housing program, a project must comply with the applicable program's requirements regarding (1) income restrictions, (2) the affordability period and related requirements for assisted units, (3) tenant protections and (4) housing quality standards. (NBs would plan to meet this r rr1 n a fidiie u assurance with a contract pint in place with City of Fayetteville) Second, Treasury will presume that an investment in the development, repair or operation of any affordable rental housing unit is an eligible use of ARPA funds if the unit provides affordability for 20 years or more, imposed through a land -use restriction (or similar) agreement, for households at or below 65% of area median income (AMI). Additionally, Treasury does not require that the income limits and 20-year affordability covenant apply to specific units. These limits can instead be used to specify a number of units in the development as long as the applicable covenants specify the bedroom size mix. NBs would plan to meet this requirement and have full assurance wJtcantra°put in place with City of Fayetteville Thank you Sarah Moore Fayetteville City Council, Ward 2 sarah.moore@favetteville-ar.gov 479.263.6629 From: Moore, Sarah <sarah.moore@fayetteville-ar.gov> Date: Monday, February 13, 2023 at 3:44 PM Page 337 of 425 City of Fayetteville, Arkansas - Budget Adjustment (Agenda) Budget Year Division CITY COUNCIL (016) Adjustment Number /Org2 2023 Requestor: Sarah Moore BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION: Council member Sarah Moore requests City Council approval of the ARPA application of and authorizing Mayor Jordan to sign a subrecipient agreement with Serve NWA d/b/a New Beginnings in the amount of $1,295,000.00 to provide low income residents with housing and other needed support. RESOLUTION/ORDINANCE COUNCIL DATE: 4/18/2023 ITEM ID#: 2023-505 Noll y Black 312912023 72:30 P/71 Budget Division Date TYPE: D - (City Council) JOURNAL#: GLDATE: CHKD/POSTED: TOTAL Account Number 1,295,000 1,295,000 increase/ (Decrease) Expense Revenue Project.Sub# Project Sub.Detl AT v.2023223 Account Name 2246.800.9728-5315.00 1,295,000 - 20023 2021 EX Contract Services 2246.800.9246-4309.01 - 1,295,000 20023 2021 RE Federal Grants - Operational 1 of 1 Page 338 of 425 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff Jonathan Curth, Development Services Director Jessica Masters, Development Review Manager FROM: Gretchen Harrison, Planner DATE: CITY COUNCIL MEMO 2023-546 SUBJECT: Appeal: CUP-2023-0008: Conditional Use Permit (348 N. FLETCHER "E./SCOTT, 485): Submitted by MIKE SCOTT, for property located at 348 N. FLETCHER ST. in WARD 1. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY - 8 UNITS PER ACRE and contains approximately 0.08 acres. The request is to use the residence as a short-term rental. RECOMMENDATION: City staff recommends approval and the Planning Commission recommends denial of a request for a conditional use permit for a short-term rental as described and shown below. BACKGROUND: The subject property is located near Mount Sequoyah, just northeast of the intersection of Dickson Street and Fletcher Avenue. The property is zoned RSF-8, Residential Single -Family, 8 Units per Acre, contains 0.08 acres, and is currently developed with a two -bedroom townhome. On April 20, 2021, City Council adopted an ordinance to regulate short-term rentals operating within its limits. On December 20, 2022, City Council amended the ordinance to enact new requirements for short-term rentals. This report reflects those new changes for consideration. Request: The applicant requests conditional use permit approval to use the property as a Type 2 short-term rental, which are those not occupied by a permanent resident. Type 2 short-term rentals are subject to density limitations, including a 2% city-wide cap, and restrictions on the number of units that may be used as a short- term rental in multi -family dwelling complexes. Findings: Staff finds that granting the requested conditional use is unlikely to negatively impact the public interest. Minimal disruptions are expected for neighbors due to applicable business licensing requirements, including a required building safety inspection, and applicable density caps limiting the maximum number of guests to six. Two off-street parking spaces are available in an existing detached carport. On -street parking is also available along the east side of Fletcher Avenue. Within a quarter mile of the property, city business license records indicate there are three active Type 2 short-term rental business licenses. There are no active or prior zoning code violations at the subject address. DISCUSSION: Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 339 of 425 At the February 27, 2023, Planning Commission meeting, a motion to deny this item passed with a vote of 7-1- 0. Commissioner Garlock made the motion with a second from Commissioner Madden. Commissioner Sparkman voted against the denial. Commissioners expressed concerns about approving a Type 2 short-term rental in a new development that was originally marketed as affordable housing, suggesting that it may adversely impact the character of this development and the surrounding neighborhood. Eight members of the public spoke at the meeting in opposition to this request. Those who spoke expressed concerns about the underlying development, noting continued problems with increased water run off, storage of residential trash carts, and parking. They also raised questions about this development being originally touted as attainable workforce housing and felt that approval of a Type 2 short-term rental would adversely impact the residential character of the area. BUDGET/STAFF IMPACT: N/A ATTACHMENTS: Appeal Letter with Council Member Sponsors, Exhibit A, Planning Commission Staff Report Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 340 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-546 Appeal: CUP-2023-0008: Conditional Use Permit (348 N. FLETCHER AVE./SCOTT, 485): Submitted by MIKE SCOTT, for property located at 348 N. FLETCHER ST. in WARD 1. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY - 8 UNITS PER ACRE and contains approximately 0.08 acres. The request is to use the residence as a short-term rental. A RESOLUTION TO GRANT THE APPEAL OF COUNCIL MEMBERS SCOTT BERNA, SONIA HARVEY, AND D'ANDRE JONES AND APPROVE CONDITIONAL USE PERMIT CUP 2023-008 FOR A SHORT-TERM RENTAL AT 348 NORTH FLETCHER STREET WHEREAS, on February 27, 2023, the Planning Commission denied the application for Conditional Use Permit CUP 2023-008, to allow a Short -Term Rental at 348 North Fletcher Street; and WHEREAS, Council Members D'Andre Jones, Sonia Harvey, and Scott Berna have properly appealed the decision of the Planning Commission pursuant to § 155.05(A)(3) of the Unified Development Code. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby grants the appeal of Council Members D'Andre Jones, Sonia Harvey and Scott Berna, finds that the proposed short term rental is compatible with adjacent properties and other property in the zoning district, and approves Conditional Use Permit CUP 2023-008 for a Short -Term Rental at 348 North Fletcher Street. Section 2: Approval of the conditional use permit is subject to the following conditions: 1. A business license must be obtained within one year of conditional use permit approval. 2. The number of occupants is limited to a maximum of two people per bedroom, plus two, for the entire unit when the property is operated as a short-term rental. 3. Special events including, but not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars are prohibited from occurring in the short term rental. 4. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. 5. All trash receptacles shall be screened from view of the right-of-way. 6. All outdoor lighting shall meet requirements as outlined in UDC Chapter 176, Outdoor Lighting. 7. Any signage shall meet the requirements as outlined in UDC Chapter 174, Signs. Page 1 Page 341 of 425 Paxton, Kara From: Berna, Scott Sent: Thursday, March 9, 2023 2:35 PM To: Mike Scott; Hertzberg, Holly; Moore, Sarah; Jones, D'Andre; Harvey, Sonia; Turk, Teresa; Bunch, Sarah; Wiederkehr, Mike Cc: Paxton, Kara Subject: Re: Appeal Request CUP-2023-0008 I will add my name to the appeal to allow it to be heard. Scott From: Mike Scott <mike.scott484@gmail.com> Sent: Thursday, March 9, 2023 8:14 AM To: Hertzberg, Holly <holly.hertzberg@fayetteville-ar.gov>; Berna, Scott <scott.berna@fayetteville-ar.gov>; Moore, Sarah <sarah.moore@fayetteville-ar.gov>; Jones, D'Andre <dandre.jones@fayetteville-ar.gov>; Harvey, Sonia <sonia.harvey@fayetteville-ar.gov>; Turk, Teresa <teresa.turk@fayetteville-ar.gov>; Bunch, Sarah <sarah.bunch@fayetteville-ar.gov>; Wiederkehr, Mike <mike.wiederkehr@fayetteville-ar.gov> Cc: Paxton, Kara <kapaxton@fayetteville-ar.gov> Subject: FW: Appeal Request CUP-2023-0008 CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Council Members, Good morning, this is a second attempt asking for your support in appealing the attached CUP-2023-008. We are at your mercy to get this application appealed and to be able to use our property as intended when we purchased it. Today is the deadline for our appeal window so please reply to Kara to notify her of your intention to sponsor our request. If you need more information, do not hesitate to contact us. Your help is greatly appreciated. Sincerely, Christy and Mike Scott 501.258.3242 Sent from Mail for Windows From: Mike Scott Sent: Saturday, March 4, 2023 10:23 AM To: sarah.bunch@favetteville-ar.gov Subject: Appeal Request CUP-2023-0008 Dear Council Members, I am writing this email to request your consideration to sponsor an appeal to CUP-2023-0008. Page 342 of 425 I am a long-standing member of the community of the City of Fayetteville. I grew up on Lafayette Street near the corner of Fletcher Ave. My parents met at the U of A and are still in the area. My father was an MAI Real Estate Appraiser before retirement and my mother worked in real estate mortgages and as a Real Estate Broker. I attended Fayetteville High School. My wife, Christy, and I are U of A alums and currently reside in Little Rock. Christy works in northwest Arkansas supporting cancer patients in treatment. We have owned a property at 853 N. Jackson Street for many years. This home is an affordable long-term rental which we want to remain as affordable housing and are considering building another affordable house on the lot. We purchased another property, a townhome, in Fayetteville for three reasons 1) we hope to retire to the area and 2) our son is attending the U of A as a freshman, and our daughter is applying for Graduate School of Business here, after she completes her undergrad at the University of Missouri. We wanted a place for us to be able to stay to visit our children and gather as a family when we are in the area. 3) Christy needs a place more like home to stay when she frequently works in the area. This is a higher priced home, and we want and need to be able to rent it out while we are not able to be there. Our intent is to rent it to friends and families that want to visit their children at the U of A and enjoy NWA. I feel most of our reasons for the appeal are stated in the letter, so I won't duplicate them here. We are certain the neighbors that protested are upset with the construction of these townhomes and not understanding the positive intent of short-term rentals. We are heavily invested in the success of our community of Fayetteville and feel our property owner rights are being impeded. We are at the mercy of your support in sponsoring this appeal. Thank you in advance. Sincerely, Christy and Mike Scott 348 N fletcher Ave Fayetteville, AR 72701 501.258.3242 Sent from Mail for Windows N Page 343 of 425 CityClerk From: Paxton, Kara Sent: Thursday, March 9, 2023 10:33 AM To: CityClerk Subject: FW: Appeal Request CUP-2023-0008 Verification of Council Member Harvey's support of appeal. Kara Paxton MSISM, MMC, CAMC, CMO City Clerk Treasurer City of Fayetteville, Arkansas kapaxtonnfavettevi11e-ar. siov T 479.575.8323# CITY Of FAV■TrIVILLO From: Harvey, Sonia <sonia.harvey@fayetteville-ar.gov> Sent: Thursday, March 9, 2023 10:09 AM To: Mike Scott <mike.scott484@gmail.com>; Hertzberg, Holly <holly.hertzberg@fayetteville-ar.gov>; Berna, Scott <scott.berna@fayetteville-ar.gov>; Moore, Sarah <sarah.moore@fayetteville-ar.gov>; Jones, D'Andre <dandre.Jones@fayetteville-ar.gov>; Turk, Teresa <teresa.turk@fayetteville-ar.gov>; Bunch, Sarah <sarah.bunch@fayetteville-ar.gov>; Wiederkehr, Mike <mike.wiederkehr@fayetteville-ar.gov> Cc: Paxton, Kara <kapaxton@fayetteville-ar.gov> Subject: Re: Appeal Request CUP-2023-0008 Dear Kara, I would like to add my name to bring this appeal forward on behalf of Christy and Mike Scott. Sincerely, Sonia Harvey Fayetteville City Council Member Ward 1, Position 1 (479) 409-5064 Report a concern with SeeClickFix: httos://www.favetteville-ar.eov/4233/Report-a-Concern-with-SeeClickFix Speak up on City projects: https://speakup.favetteville-ar.gov/ Voice your feedback to the entire Council and Mayor by emailing: agendaitemcomment@favetteville-ar.gov From: Mike Scott <mike.scott484@gmail.com> Sent: Thursday, March 9, 2023 8:14 AM To: Hertzberg, Holly <holly.hertzberg@favetteville-ar.gov>; Berna, Scott <scott.berna@favetteville-ar.gov>; Moore, Page 344 of 425 Sarah <sarah.moore@favetteville-ar.gov>; Jones, D'Andre <dandre.iones@favetteville-ar.gov>; Harvey, Sonia <sonia.harvev@favetteville-ar.gov>; Turk, Teresa <teresa.turk@favetteville-ar.gov>; Bunch, Sarah <sarah.bunch@favetteville-ar.gov>; Wiederkehr, Mike <mike.wiederkehr@favetteville-ar.gov> Cc: Paxton, Kara <kapaxton@favetteville-ar.gov> Subject: FW: Appeal Request CUP-2023-0008 CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Council Members, Good morning, this is a second attempt asking for your support in appealing the attached CUP-2023-008. We are at your mercy to get this application appealed and to be able to use our property as intended when we purchased it. Today is the deadline for our appeal window so please reply to Kara to notify her of your intention to sponsor our request. If you need more information, do not hesitate to contact us. Your help is greatly appreciated. Sincerely, Christy and Mike Scott 501.258.3242 Sent from Mail for Windows From: Mike Scott Sent: Saturday, March 4, 2023 10:23 AM To: sarah.bunch@favetteville-ar.gov Subject: Appeal Request CUP-2023-0008 Dear Council Members, I am writing this email to request your consideration to sponsor an appeal to CUP-2023-0008. I am a long-standing member of the community of the City of Fayetteville. I grew up on Lafayette Street near the corner of Fletcher Ave. My parents met at the U of A and are still in the area. My father was an MAI Real Estate Appraiser before retirement and my mother worked in real estate mortgages and as a Real Estate Broker. I attended Fayetteville High School. My wife, Christy, and I are U of A alums and currently reside in Little Rock. Christy works in northwest Arkansas supporting cancer patients in treatment. We have owned a property at 853 N. Jackson Street for many years. This home is an affordable long-term rental which we want to remain as affordable housing and are considering building another affordable house on the lot. We purchased another property, a townhome, in Fayetteville for three reasons 1) we hope to retire to the area and 2) our son is attending the U of A as a freshman, and our daughter is applying for Graduate School of Business here, after she completes her undergrad at the University of Missouri. We wanted a place for us to be able to stay to visit our children and gather as a family when we are in the area. 3) Christy needs a place more like home to stay when she frequently works in the area. This is a higher priced home, and we want and need to be able to rent it out while we are not able to be there. Our intent is to rent it to friends and families that want to visit their children at the U of A and enjoy NWA. I feel most of our reasons for the appeal are stated in the letter, so I won't duplicate them here. We are certain the neighbors that protested are upset with the construction of these townhomes and not understanding the positive intent of short-term rentals. Page 345 of 425 We are heavily invested in the success of our community of Fayetteville and feel our property owner rights are being impeded. We are at the mercy of your support in sponsoring this appeal. Thank you in advance. Sincerely, Christy and Mike Scott 348 N fletcher Ave Fayetteville, AR 72701 501.258.3242 Sent from Mail for Windows Page 346 of 425 Paxton, Kara From: D'Andre Jones <dre91732000@gmail.com> Sent: Thursday, March 9, 2023 11:21 AM To: Harvey, Sonia Cc: Mike Scott; Hertzberg, Holly; Berna, Scott; Moore, Sarah; Jones, D'Andre; Turk, Teresa; Bunch, Sarah; Wiederkehr, Mike; Paxton, Kara Subject: Re: Appeal Request CUP-2023-0008 CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Hey Kara I am ok with sponsoring the appeal Sent from my iPhone On Mar 9, 2023, at 10:08 AM, Harvey, Sonia <sonia.harvey@fayetteville-ar.gov> wrote: Dear Kara, I would like to add my name to bring this appeal forward on behalf of Christy and Mike Scott. Sincerely, Sonia Harvey Fayetteville City Council Member Ward 1, Position 1 (479) 409-5064 Report a concern with SeeClickFix: https://www.fayetteville-ar.gov/4233/Report-a-Concern-with-SeeClickFix Speak up on City projects: https://speakup.favetteville-ar.gov/ Voice your feedback to the entire Council and Mayor by emailing: agendaitemcomment@favetteville-ar.gov From: Mike Scott <mike.scott484@gmail.com> Sent: Thursday, March 9, 2023 8:14 AM To: Hertzberg, Holly <holly.hertzberg@favetteville-ar.gov>; Berna, Scott <scott.berna@fayetteville- ar.gov>; Moore, Sarah <sarah.moore@fayetteville-ar.gov>; Jones, D'Andre <dandre.jones@fayetteville- ar.gov>; Harvey, Sonia <son ia. ha rvey@fayettevil le -a r.gov>; Turk, Teresa <teresa.turk@fayetteville- ar.gov>; Bunch, Sarah <sarah.bunch@fayetteville-ar.gov>; Wiederkehr, Mike <mike.wiederkehr@fayetteville-ar.gov> Cc: Paxton, Kara <kapaxton@fayetteville-ar.gov> Subject: FW: Appeal Request CUP-2023-0008 CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Page 347 of 425 Dear Council Members, Good morning, this is a second attempt asking for your support in appealing the attached CUP-2023- 008. We are at your mercy to get this application appealed and to be able to use our property as intended when we purchased it. Today is the deadline for our appeal window so please reply to Kara to notify her of your intention to sponsor our request. If you need more information, do not hesitate to contact us. Your help is greatly appreciated. Sincerely, Christy and Mike Scott 501.258.3242 Sent from Mail for Windows From: Mike Scott Sent: Saturday, March 4, 2023 10:23 AM To: sarah.bunch@fayetteville-ar.gov Subject: Appeal Request CUP-2023-0008 Dear Council Members, I am writing this email to request your consideration to sponsor an appeal to CUP-2023-0008. I am a long-standing member of the community of the City of Fayetteville. I grew up on Lafayette Street near the corner of Fletcher Ave. My parents met at the U of A and are still in the area. My father was an MAI Real Estate Appraiser before retirement and my mother worked in real estate mortgages and as a Real Estate Broker. I attended Fayetteville High School. My wife, Christy, and I are U of A alums and currently reside in Little Rock. Christy works in northwest Arkansas supporting cancer patients in treatment. We have owned a property at 853 N. Jackson Street for many years. This home is an affordable long-term rental which we want to remain as affordable housing and are considering building another affordable house on the lot. We purchased another property, a townhome, in Fayetteville for three reasons 1) we hope to retire to the area and 2) our son is attending the U of A as a freshman, and our daughter is applying for Graduate School of Business here, after she completes her undergrad at the University of Missouri. We wanted a place for us to be able to stay to visit our children and gather as a family when we are in the area. 3) Christy needs a place more like home to stay when she frequently works in the area. This is a higher priced home, and we want and need to be able to rent it out while we are not able to be there. Our intent is to rent it to friends and families that want to visit their children at the U of A and enjoy NWA. I feel most of our reasons for the appeal are stated in the letter, so I won't duplicate them here. We are certain the neighbors that protested are upset with the construction of these townhomes and not understanding the positive intent of short-term rentals. We are heavily invested in the success of our community of Fayetteville and feel our property owner rights are being impeded. We are at the mercy of your support in sponsoring this appeal. Thank you in advance. Sincerely, N Page 348 of 425 Christy and Mike Scott 348 N fletcher Ave Fayetteville, AR 72701 501.258.3242 Sent from Mail for Windows Page 349 of 425 CUP-2023-0008 Close Up View SUTTON •ST L'AFAYETTE&S -DICKSOWST Neighborhood Link Alley Residential Link Hillside -Hilltop Overlay District r Planning Area Fayetteville City Limits — — — Trail (Proposed) 348 N FLETCHER AVE L-AFAYETTE- Subject Property RSF-4 Feet 0 75 150 300 1:2,400 450 600 7-1 EXHIBIT 'A' RSF-4 RSF-8 RSF-18 RMF-6 RMF-24 P-1 Page 350 of 425 CITY OF FAYETTEVILLE I\. ARKANSAS PLANNING COMMISSION MEMO TO: Fayetteville Planning Commission THRU: Jessie Masters, Development Review Manager FROM: Gretchen Harrison, Planner MEETING DATE: February 27, 2023 (Updated with results) SUBJECT: CUP-2023-0008: Conditional Use Permit (348 N. FLETCHER AVE./SCOTT, 485): Submitted by MIKE SCOTT for property located at 348 N. FLETCHER AVE. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY — 8 UNITS PER ACRE and contains approximately 0.08 acres. The request is to use the residence as a short-term rental. RECOMMENDATION: Staff recommends approval of CUP-2023-0008 with conditions as outlined by staff. RECOMMENDED MOTION: "I move to approve CUP-2023-0008, determining: In favor of compatibility with adjacent properties, and In favor of all other conditions as recommended by staff. " BACKGROUND: The subject property is located near Mount Sequoyah, just northeast of the intersection of Dickson Street and Fletcher Avenue. The property is zoned RSF-8, Residential Single -Family, 8 Units per Acre, contains 0.08 acres, and is currently developed with a two -bedroom townhome. On April 20, 2021, City Council adopted an ordinance to regulate short-term rentals operating within its limits. On December 20, 2022, City Council amended the ordinance to enact new requirements for short-term rentals. This report reflects those new changes for consideration. Surrounding land use and zoning are depicted in Table 1. Table 1: Surrounding Land Use and Zoning Direction Land Use Zoning North Two -Family Residential RSF-8, Residential Single -Family — 8 Units per Acre South Two -Family Residential RSF-8, Residential Single -Family — 8 Units per Acre East Single -Family Residential RSF-4, Residential Single -Family — 4 Units per Acre West Two -Family Residential RSF-4, Residential Single -Family — 4 Units per Acre City Plan 2040 Future Land Use Designation: Residential Neighborhood Proposal: The applicant requests conditional use permit approval to use the property as a Type 2 short-term rental, which are those not occupied by a permanent resident. Type 2 short-term rentals are subject to density limitations, including a 2% city-wide cap, and restrictions on the number of units that may be used as a short-term rental in multi -family dwelling complexes. Page 351 of 425 Public Comment: Staff received public comment in opposition to this request from an individual who expressed concerns about this short-term rental adversely impacting the residential character of the neighborhood. Their letter is attached for reference. RECOMMENDATION: Staff recommends approval of CUP-2023-0008 with the following conditions: Conditions of Approval: Planning Commission determination of compatibility. Staff finds the proposed short- term rental to be compatible with the neighborhood based on the findings in this report. 2. Approval of the conditional use permit does not ensure approval of a business license application. The applicant must still be able to comply with all other applicable requirements in city code. 3. Per UDC §166.20, Expiration of Approved Plans and Permits, a business license must be obtained within one year of conditional use permit approval. 4. Per ordinance, the number of occupants is limited to a maximum of two people per bedroom, plus two, for the entire unit when the property is operated as a short-term rental. 5. Special events including, but not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars are prohibited from occurring in the short- term rental. 6. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. 7. All trash receptacles shall be screened from view of the right-of-way. 8. All outdoor lighting shall meet requirements as outlined in UDC Chapter 176, Outdoor Lighting. 9. Any signage shall meet the requirements as outlined in UDC Chapter 174, Signs. PLANNING COMMISSION ACTION: Required YES Date: February 27, 2023 O Tabled O Approved ® Denied IMotion: Garlock (Second: Madden (Vote: 7-1-0 (motion to deny) Page 352 of 425 FINDINGS OF THE STAFF §163.02. AUTHORITY; CONDITIONS; PROCEDURES. B. Authority; Conditions. The Planning Commission shall: 1. Hear and decide only such special exemptions as it is specifically authorized to pass on by the terms of this chapter. 2. Decide such questions as are involved in determining whether a conditional use should be granted; and, 3. Grant a conditional use with such conditions and safeguards as are appropriate under this chapter; or 4. Deny a conditional use when not in harmony with the purpose and intent of this chapter. C. Procedures. A conditional use shall not be granted by the Planning Commission unless and until: 1. A written application for a conditional use is submitted indicating the section of this chapter under which the conditional use is sought and stating the grounds on which it is requested. Finding: The applicant has submitted a written application requesting a conditional use permit for a Type 2 short-term rental in RSF-8 zoning. 2. The applicant shall pay a filing fee as required under Chapter 159 to cover the cost of expenses incurred in connection with processing such application. Finding: The applicant has paid the required filing fee. 3. The Planning Commission shall make the following written findings before a conditional use shall be issued: (a.) That it is empowered under the section of this chapter described in the application to grant the conditional use; and Finding: The Planning Commission is empowered under City Code §118.01(E)(2) to grant the requested conditional use permit. (b.) That the granting of the conditional use will not adversely affect the public interest. Finding: Staff finds that granting the requested conditional use is not likely to affect the public interest given the applicable business license requirements, including a required building safety inspection, and applicable density caps on Type 2 short-term rentals. (c.) The Planning Commission shall certify: (1.) Compliance with the specific rules governing individual conditional uses; and Page 353 of 425 Finding: There are specific rules governing short-term rentals, as follows: §163.18. SHORT-TERM RENTALS. A. Residential Zoning Districts. Type 2 short-term rentals may be permitted as a conditional use in the following residential zoning districts: R-A, RSF-.5, RSF-1, RSF-2, RSF-4, RSF-7, RSF-8, RSF-18, RI-12, RI-U, RMF-6, RMF-12, RMF-18, RMF-24, RMF-40, and NC. Short term rentals may be permitted by right or by conditional use in planned zoning districts subject to the zoning regulations enacted by the City Council for each district. Short-term rentals in non-residential zoning districts, mixed use zoning districts, or other zoning districts not listed above are not required to apply for a conditional use permit. Finding: The request is to operate a Type 2 short-term rental in RSF-8 zoning. Since RSF-8 is a residential zoning district, a conditional use permit is required. B. Occupancy. Maximum of two (2) people per bedroom, plus two (2), for the entire unit when operated as a short-term rental. Finding: Occupancy is limited as described in UDC §163.18(B). Occupancy limitations are confirmed by the applicant during licensing. Since this townhome contains two bedrooms, occupancy will likely be limited to a maximum of six guests. C. Parking. Parking is limited to the maximum number of vehicles as allowed by the underlying zoning district for the residential building on the property. Finding: Parking is limited as described in UDC §163.18(C). Parking for townhomes is required to be provided at a rate of one vehicle space per bedroom. According to the applicant, the unit has two bedrooms and two off-street parking spaces available in an existing carport. D. Special events are not permitted in a short-term rental. Example of special events include, but are not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars. Finding: The applicant's request letter suggests the property will comply with the City's regulations for a short-term rental. As a condition of approval, staff recommends a prohibition on special events. E. Short-term rental units are allowed in any structure established as a permanent residential dwelling including an accessory dwelling unit. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. Finding: The application is for use of the property at 348 N. Fletcher Ave. Staff recommends a condition confirming that no recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. Page 354 of 425 F. Exceptions. Exceptions to the short-term rental standards, except proposals that would exceed the city-wide density maximum, may be granted by the Planning Commission as a conditional use permit. Finding: Type 2 short-term rentals are subject to a city-wide density cap at 2% of total dwelling units, as determined by United States Census Bureau data. Recently released five-year American Community Survey data from 2021 lists total housing units in Fayetteville at 44,706, which puts the cap at 894 total Type 2 short-term rentals. To date, the City has issued 311 Type 2 short- term rental licenses that are subject to this cap. Hotel/motel uses are not permitted by right in the underlying RSF-8 zoning, so this short-term rental would contribute to the city-wide density cap. While this short-term rental is in a multi -unit structure, it is not subject to a building density cap since all units are on individual lots of record. No exceptions to the short-term rental standards are being requested with this conditional use permit. G. Short-term rentals must comply with all applicable codes under City Code §118.01 and successfully obtain a business license prior to operation. Finding: This short-term rental would be subject to all regulations in City Code §118.01 that apply to Type 2 short-term rentals in residential zoning districts. Applicable business licensing requirements will be reviewed by staff and confirmed by the applicant at the time of licensing. H. Short-term rentals in residential zoning districts may be subject to denial or additional conditions based upon the Planning Commission's findings on the following factors: 1. Adequate parking infrastructure; 2. Adequate adjoining or nearby streets for on -street parking; 3. Frequency or concentration of nearby licensed Type 2 short-term rentals; and 4. Prior zoning or code violations. Finding: There appears to be adequate parking available to support the use of the property as a short-term rental based on the applicant's submittal. A total of two spaces are available in a carport and a maximum of six guests are permitted. The property also has frontage along a portion of Fletcher Avenue that is wide enough to support on -street parking. City business license records indicate that three other units within a quarter -mile radius of the property have active Type 2 short-term rental business licenses. No prior zoning or code violations have been reported at this location. §163.02. AUTHORITY; CONDITIONS; PROCEDURES. (continued) (2.) That satisfactory provisions and arrangements have been made concerning the following, where applicable: (a.) Ingress and egress to property and proposed structures thereon with particular reference to automotive and pedestrian safety and convenience, Page 355 of 425 traffic flow and control and access in case of fire or catastrophe; Finding: The subject property has access to Fletcher Avenue through a shared private driveway and there is sidewalk present along the property's frontage. Staff finds that the proposal will not adversely affect traffic flows considering the use of the property would be limited to a maximum of six guests, which would not be out of character with use of the property for residential purposes. (b.) Off-street parking and loading areas where required, with particular attention to ingress and egress, economic, noise, glare, or odor effects of the special exception on adjoining properties and properties generally in the district; Finding: The applicant has indicated that there are two guest vehicle parking spaces available in an existing carport. The short-term rental ordinance limits the number of guest vehicles to the maximum number of vehicles as allowed by the underlying zoning district. (c.) Refuse and service areas, with particular reference to ingress and egress, and off-street parking and loading; Finding: The applicant proposes to utilize existing residential trash cart service. Staff recommends that the containers should be screened from public view when not at the curb for residential pick-up. (d.) Utilities, with reference to locations, availability, and compatibility; Finding: Utilities are currently available to the site and the use as a short-term rental is not anticipated to impact the provision of utilities. (e.) Screening and buffering with reference to type, dimensions, and character; Finding: Staff recommends that residential carts be screened so that they are not visible from the public right-of-way. (f.) Signs, if any, and proposed exterior lighting with reference to glare, traffic safety, economic effect, and compatibility and harmony with properties in the district; Finding: Any proposed signage will be subject to UDC Chapter 174, Signs, and all regulations therein. (g.) Required yards and other open space; and Page 356 of 425 Finding: Based on the applicant's submittal, the structure is meeting relevant setbacks. (h.) General compatibility with adjacent properties and other property in the district. Finding: Staff finds the proposed use to be compatible with surrounding properties. The property is surrounded by residential uses, and short-term rentals are permitted by right in RSF-8 zoning. There appears to be adequate parking to accommodate the number of permitted guests, and staff does not anticipate any adverse traffic impacts with this request. Since the RSF-8 zoning district does not allow hotel/motel uses by right, this short-term rental would contribute to the city-wide density cap. BUDGET/STAFF IMPACT: None ATTACHMENTS: • Business Regulations o §118.01 Applicability • Unified Development Code o §161.09 District RSF-8, Residential Single -Family —Eight (8) Units Per Acre o §163.18 Type 2 Short -Term Rentals in Residential Zoning Districts • Applicant Request Letter • Building Floor Plans • Building Elevations • Site Plan • Public Comment • One Mile Map • Close -Up Map • Current Land Use Map • STRs within % Mile Map - Public comment received after PC report publication Page 357 of 425 118.01 Applicability (E) Short -Term Rentals. A residential dwelling unit, portion of a dwelling unit, or bedroom within a residential dwelling unit, leased and/or rented to a guest(s), for a period of less than thirty consecutive (30) days. (1) Short -Term Rental, Type 1. A short-term rental where the principal use of the property remains as a full- time residence. The occupants or owner rent their primary residence as a short-term rental. A copy of the Homestead Tax Credit or long-term lease agreement for the subject property is required to be classified as a Type 1 rental. The occupant or owner must occupy the residence for nine (9) months of the year. Accessory dwelling units (ADUs) as defined in Unified Development Code Chapter 151 shall be considered a Type 1 short-term rental. (2) Short -Term Rental, Type 2. A short-term rental that is not occupied by a permanent resident. The owner lists this property full-time as a short-term rental and has no intention of having permanent residents living in the property. A conditional use permit is required for a Type 2 short-term rental in a residential zoning district prior to the city issuing a business license. (3) License Required. No dwelling unit in the city shall be used as a short-term rental unless: (a) The owner of the dwelling unit or operator of the short-term rental possess a valid and current business license for the dwelling unit, and fully complies with all legal requirements and duties imposed herein with respect to each and every short-term rental; and (b) The owner has designated an agent, where said agent fully complies with all legal requirements and duties imposed herein with respect to every short-term rental. The owner may serve as their own agent. (c) The owner of the dwelling unit or operator of the short-term rental provides proof of a valid and current homeowners insurance rider policy which fully covers each unit when operated as short-term rental unit. (4) A separate business license shall be required for each dwelling unit used as a short-term rental. (5) Any change in ownership requires a new or amended business license. (6) If any required contact information changes for the associated business license, the person to whom the license was issued shall immediately notify the Development Services Department in writing. (7) License Application. The application for a business license shall include at minimum, the following information from applicants: (a) The property owner's information including legal name, mailing address, immediate contact phone number, and immediate contact E-mail address. (b) Information for the dwelling unit subject to the application, inclusive of the physical street address assigned by the city. (c) The type and total number of dwelling units located on the lot of record containing the dwelling unit subject to the application. (d) If the owner is not their own agent, the owner designated agent's information including legal name, mailing address, immediate contact phone number and immediate contact E-mail address. (e) Documentation of approval of a life safety and egress inspection by the City Building Safety Division for the dwelling unit subject to the application. (f) Proof of application for remittance of hotel, motel and restaurant tax to the City of Fayetteville, and verification that all sales, use, and hotel, motel and restaurant taxes are current. (g) Any additional data as deemed necessary or desirable for permit approval by the Development Services Director. (8) License Renewals. Business licenses for short-term rentals shall be renewed in accordance with Chapter 118 of the Business Regulations (Business Registry and Licenses). (11) Legal Duties of License Holders. An owner possessing a short-term rental license shall comply at all times with the following requirements: (a) Occupancy. Short-term rentals shall be subject to, and may not exceed, the occupancy limits approved with the business license. (b) Advertisements. A short-term rental shall not be advertised if it violates occupancy, density, safety, and any of the other provisions of the Fayetteville Code. No short-term rental unit shall be advertised prior to having obtained a business license and the business license number shall be included in the advertisement listing. (c) Information and Posting. Business licensees shall provide to guests and post conspicuously in the common area of the short-term rental unit the city phone number to report a safety complaint. (10) Owner or AgentAccessibility. The property owner shall ensure that they or a designated agent are available at all times during guest occupancy, including nights and weekends, in order to facilitate compliance with Page 358 of 425 this section. For the purposes of these regulations, 'availability' means that the owner or agent is accessible by telephone, and, able to be physically present at the short-term rental within three (3) hours of being contacted. (11) Guest Records. The owner shall maintain summary guest registration records, which shall contain the actual dates of occupancy, total number of guests per party per stay, and the rate(s) charged, but shall not contain any personally identifiable information about guests. Such records shall be maintained for three (3) years and shall be provided to the City upon request. (12) Health and Safety. The owner shall ensure that each dwelling unit governed by this section complies with the applicable provisions of the Unified Development Code Chapter 173, Building Regulations. (13) Criminal Activity. The owner shall timely report any known or reasonably suspected criminal activity by a guest to the Fayetteville Police Department within twelve (12) hours maximum. (14) Taxes and Fees. Except for those instances in which a hosting platform bears the responsibility for collecting and remitting taxes and fees applicable to short-term rentals, the property owner shall timely remit in full Fayetteville Hotel, Motel and Restaurant tax and other applicable local, state, and federal taxes and city fees owed in connection with any short-term rental. The failure of a hosting platform to collect and remit taxes and fees shall not relieve an owner of the obligation to pay taxes and fees owed pursuant to this section. (15) Authorization to Occupy, Use, and Operate. Authorization to operate a short-term rental may be granted by the Development Services Director through the issuance of a City of Fayetteville Business Registry and License (Business License). (16) Density For Type 2 Short -Term Rentals. A city-wide density cap of 2% of all dwelling units in the Fayetteville city limits may be utilized as Type 2 rentals. Total dwelling units are determined from current United States Census Bureau and/or American Community Survey numbers, whichever number is higher. A conditional use permit may not permit: (a) More Type 2 short-term rentals than what is allowed by the city-wide density cap. Type 2 short-term rentals in commercial and mixed -use zoning districts where hotel/motels are permitted by right shall not contribute to the city-wide density cap. (b) More than 10% or a single unit whichever is greater; of total dwelling units as Type 2 rentals within a multi -family dwelling complex. (c) Individual 2-, 3- and 4-family buildings that are owned by the same person or entity and are not a part of a multi -family complex shall have no more than one (1) Type 2 short-term rental unit per building complex. (d) Where attached residential units are held separately through condominium association, horizontal property regime, fee simple, or similar ownership structure, no cap shall be applied to buildings with attached residential dwellings. Structures of attached residential dwellings where applicants seek more than 10% of total units for licensing as Type 2 rentals shall be evaluated by the Building Safety Director and/or Fire Marshal for adequate fire protection as defined by the adopted Arkansas Fire Prevention Code. Where inadequate fire protection is identified, improvements may be required prior to issuance of a business license. (17) Suspension and Revocation. If the Development Services Director has reason to believe that any of the grounds specified in §118.03(A) of the Fayetteville Code exist, or that any rental unit was rented for less than one (1) full night, or to more than one (1) part of guests for the same period of time, or otherwise failed to comply with all terms and conditions of this section, the Development Services Director may suspend or revoke the short-term rental's business license pursuant to the procedures detailed in §118.03 and in §118.04 of the Fayetteville Code. (20) Short-term rentals must comply with all applicable codes under Unified Development Code §163.18 and § 164.26 successfully obtain a business license prior to operation. ( Ord. No. 6427, §§l(Exh. A), 2, 4-20-21; Ord. No. 6505, §1(Exh. A), 11-16-21; Ord. No. 6521 , §§1, 2, 1-18-22; Ord. No. 6537 , §1(Exh. A), 2-15-22) Page 359 of 425 161.09 District RSF-8, Residential Single -Family - Eight (8) Units Per Acre (A) Purpose. The RSF-8 Residential District is designed to bring historic platted development into conformity and to allow for the development of new single family residential areas with similar lot size, density, and land use as the historical neighborhoods in the downtown area. (B) Uses. (1) Permitted Uses. Unit 1 City-wide uses by right Unit 8 Single-family dwellings Unit 41 Accessory dwellings Unit 46 Short-term rentals (2) Conditional Uses. Unit 2 City-wide uses by conditional use permit Unit 3 Public protection and utility facilities Unit 4 Cultural and recreational facilities Unit 5 Government facilities Unit 9 Two-family dwellings Unit 12a Limited business Unit 24 Home occupations Unit 36 Wireless communications facilities Unit 44 Cluster Housing Development (C) Density. By Right Single-family dwelling units per 8 or less acre (D) Bulk and Area Regulations. (1) Lot Width Minimum. Single-family 50 feet Two 2 family 50 feet Townhouse, no more than two 2 attached 25 feet (2) Lot Area Minimum. Single-family 5,000 square feet Two-family 5,000 square feet (3) Land Area Per Dwelling Unit. Single-family 5,000 square feet Two-family 5,000 square feet Townhouse, no more than two 2 attached 2,500 square feet (E) Setback Requirements. Front Side Rear 15 feet 5 feet 5 feet (F) Height Regulations. Building Height Maximum 3 stories Page 360 of 425 (G) Building Area. The area occupied by all buildings shall not exceed 50% of the total lot area, except when a detached garage exists or is proposed; then the area occupied by all buildings shall not exceed 60% of the total lot area. Accessory ground mounted solar energy systems shall not be considered buildings. (Ord. No. 4783, 10-18-05; Ord. No. 5028, 6-19-07; Ord. No. 5128, 4-15-08; Ord. No. 5224, 3-3-09; Ord. No. 5312, 4- 20-10; Ord. No. 5462, 12-6-11; Ord. No. 5921 , §1, 11-1-16; Ord. No. 5945 , §8, 1-17-17; Ord. No. 6015 , §1(Exh. A), 11-21-17; Ord. No. 6245 , §2, 10-15-19; Ord. No. 6427 , §§l(Exh. C), 2, 4-20-21) Ord. No. 6427 , § 2, adopted April 20, 2021, "determines that this ordinance and all amendments to Code sections ordained or enacted by this ordinance shall automatically sunset, be repealed, terminated, and become void twenty (20) months after the passage and approval of this ordinance, unless prior to that date, the City Council amends this ordinance to repeal this sunset, repeal and termination section." Page 361 of 425 163.18 Type 2 Short -Term Rentals in Residential Zoning Districts (A) Residential Zoning Districts. Type 2 short-term rentals may be permitted as a conditional use in the following residential zoning districts: 1) R-A 2) RSF-.5 3) RSF-1 4) RSF-2 5) RSF-4 6) RSF-7 7) RSF-8 8) RSF-18 9) RI-12 10) RW 11) RMF-6 12) RMF-12 13) RMF-18 14) RMF-24 15) RMF-40 16) NC Short term rentals may be permitted by right or by conditional use in planned zoning districts subject to the zoning regulations enacted by the City Council for each district. Short-term rentals in non-residential zoning districts, mixed use zoning districts, or other zoning districts not listed above are not required to apply for a conditional use permit. (B) Occupancy. Maximum of two (2) people per bedroom, plus two (2), for the entire unit when operated as a short-term rental. (C) Parking. Parking is limited to the maximum number of vehicles as allowed by the underlying zoning district for the residential building on the property. (D) Special events are not permitted in a short-term rental. Example of special events include, but are not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars. (E) Short-term rental units are allowed in any structure established as a permanent residential dwelling including an accessory dwelling unit. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. (F) Exceptions. Exceptions to the short-term rental standards, except proposals that would exceed the city- wide density maximum, may be granted by the Planning Commission as a conditional use permit. (G) Short-term rentals must comply with all applicable codes under City Code §118.01 and successfully obtain a business license prior to operation. (H) Short-term rentals in residential zoning districts may be subject to denial or additional conditions based upon the Planning Commission's findings on the following factors: 1) Adequate parking infrastructure; 2) Adequate adjoining or nearby streets for on -street parking; 3) Frequency or concentration of nearby licensed Type 2 short-term rentals; and 4) Prior zoning or code violations ( Ord. No. 6427, §§l(Exh. E), 2, 4-20-21; Ord. No. 6505, §2(Exh. B), 11-16-21; Ord. No. 6537, §2(Exh. B), 2-15-22) Page 362 of 425 Scott Holdings, LLC Request Letter 01/13/2023 Re: 348 N Fletcher Avenue Fayetteville, AR 72701 To whom it may concern: This is a request letter to license the town home at 348 N Fletcher as a STR II Rental Property. The home will be providing a vacation destination to tourists and families coming into Fayetteville for University Activities as well as other tourist activities such as Mountain Biking and sightseeing. The property will also be used by the owners as a second home when in Fayetteville for work and to visit our University of Arkansas student. The townhome is a 2 Bedroom 1.5 Bath. It is a new build and has been furnished as a STR / vacation home. The site is approximately 3625 sf and the Living area is approximately 1263 sf. It is a two-story townhome. It has a carport with 2 off street parking spaces. There are on building lights at both the front and rear entrance to the townhome. There shouldn't be any excess noise regarding this usage. The back yard is enclosed with a privacy fence to buffer. Trash pick-up is on weekly pick up by the city. Trash can is kept behind a fence near property. Several of these units are used as vacation properties and student housing currently. Best Regards, Mike Scott Christy Scot 20283 Country Creek Lane, Little Rock, AR 72223 P 501-258-3242 Page 363 of 425 CUP-2023-0008 Building Floor Plans First Floor Second Floor Page 364 of 425 CUP-2023-0008 Building Elevations Page 365 of 425 z T (7t FF(-(t s C� �I C Page 366 of 425 February 22, 2023 Fayetteville Planning Commission RE: CUP 2023- 008, 009, and 0018 Commission Members: This letter is to ask the Planning Commission not to approve the rezoning request to allow 332 North Fletcher, 344 North Fletcher and 348 North Fletcher to engage in short -termed rental agreements. These properties are currently zoned Residential/Single family. The plot of land that these Townhouses set on had 2 houses at one time. A couple of years ago the plot was rezoned to allow 8 units per acre (this would allow for 7 single family homes) to be built. The public was told this followed the theory of "filling the infield" with affordable housing. The houses were never built. Instead, the plan changed and 5 (2 units each) townhouses were built. Due to lack of full-time occupancy these units do not add to any kind of "community feel" and certainly do not contribute to alleviating the affordable housing need in Fayetteville. In addition, valuable infield space has been lost. Now the requests to allow short term rentals will be like having "hotels" in the infield. The owners of these units knew how they were zoned when they purchased them. To come in and attempt to change that shows a complete lack of appreciation for the culture and ambience of this neighborhood. Should this request be approved, it will most likely be the beginning of more requests that will contribute to the detriment of not only this community, but others too. I live at 236 North Fletcher and I am not comfortable with having different people continually rotating through the neighborhood, with very little oversight. It is not what a residential community should be like. Once again, I hope this request is denied. I would appreciate it if you would acknowledge receipt of this letter and share with others on the Commission. You have my permission to read aloud in the meeting. Thank you for your time. Paul Blisard 417-766-5364 pblisard@uark.edu Page 367 of 425 CUP-2023-0008 348 N F LETC H E R AVE One Mile View NORTH 0 0.13 0.25 0.5 Miles I Q l W l C9 l W t J i J UT 0 V i CS J m I ZO nc r Subject Property Rrzn MH FAYE I K R-O ■II CK-- --r T II s- iiiiiiii Neighborhood Link iiiiiii= Regional Link - High Activity Urban Center — Unclassified — Alley — Residential Link — — Shared -Use Paved Trail Trail (Proposed) Design Overlay District j — Fayetteville City Limits r Planning Area RSF-4 \ l � I Q Pla<Limits _ _ _ Fay F ) Zoning General Industrial RESIDENTIAL SINGLE-FAMILY EXTI-2 RA ION RI-u COMMERCIAL RI-12 ResltleniiaFOfice Ns-L Gi �Res1tleMlal-�dWIW21 RSF-s Ica RSF-1 FORM BASED DISTRICTS RSF-2 Gown—n Core RSF4 Uman Thomaghrare RSF-] ..in... Center RSF-s General RSF-18 �Communlry services RESIDENTIAL MULTI -FAMILY Neighborhood services RMF-8 Neighbo .d Con Mion �RMF-12 PLANNED ZONING DISTRICTS RMF-11 =Commercial, Ind. —I, Resldentlal RMF-2a INSTITUTIONAL RMF-00 _P1 INDUSTRIAL I-1 Heavy Commensal and Light lndu—I Page 368 of 425 CUP-2023-0008 Close Up View SUTTON •ST L'AFAYETTE&S -DICKSOWST Neighborhood Link Alley Residential Link Hillside -Hilltop Overlay District r Planning Area Fayetteville City Limits — — — Trail (Proposed) 348 N FLETCHER AVE RSF-4 0 75 150 L-AFAYETTE- Subject Property Feet 300 1:2,400 450 600 7-1 RSF-4 RSF-8 RSF-18 RMF-6 RMF-24 P-1 Page 369 of 425 `+..��� -� �T �,.�..` �.-�.•+-•tom -�: �� -- Al 7 -­ - j, a _ L14 low14 , IN MW Al Jy Al lRk IN 7 do AA 74 ti � fi • � � • • � 4'yr v - y f 3 � �1 .7 I p • r wl. � .: 'AA , !kY WON. NO.- 7 IfIA Af a • —�� � � i Cam' 1 �e ...' @ .i •gip; �. E' PW- :, 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook It doesn't look like this was sent to the other commissioners. Please share before Monday night's Planning Commission. Thanks! -- Mary From: emily ervin <Inkedgirll cox.net> Sent: Friday, February 24, 2023 5:08 PM To: Madden, Mary<mary.madden (cDfayetteville-ar.gov> Subject: fletcher ave townhomes CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. good afternoon— i've lived at 362 n. fletcher for 21 years, adjacent to the new townhomes being considered for short-term rentals. i watched the agenda meeting last night and wanted to confirm what you and Commissioner Garlock mentioned. you are correct in that these were touted and approved as "attainable" and "workforce" housing, both in writing, as well as in discussion during city meetings, during the initial rezone and the following CUP. additionally, i have written letters and spoken with the planning department a few times about this and other concerns. to be frank, I'm exhausted, defeated, and incredibly disappointed in the handling of this project and how we've been disregarded. not only was the applicant given preferential latitude (if that's a term) by city staff, but also was allowed to misrepresent water runoff issues to both theirs and the property seller's advantage. there were two cost shares with the city that benefited only the developer. we now have flooding issues due to the entirety of our adjacent property line being dug out (some parts several times over). i've held fayetteville to a higher standard in the 27 years it's been my home. the false housing narrative and public smearing by those who vote on our livelihood has been personally crushing. i appreciate your work and integrity in helping our city to grow responsibly. sure, change is hard, but i've always welcomed new folks to our community. we've got so much to offer. thanks so much, emily ervin as a correction, this property has had code violations in the past, however the addresses were previously 310 and 326 north fletcher. the parking lot in the back is very hard to maneuver and cars "bottom out" at the entrance, so there's already been increased parking along fletcher, along with beer cans and folks coming into our yard after midnight. the plans presented to the commission had a "low impact development island to protect parallel parking and calm traffic" but wasn't implemented. I'm attaching a timeline with links to city meetings and agendas related to this development, for reference. https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2YiliMWl1LWQ3YzUOZjQ1MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk7%*92.OfWZ5 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook CUP-2 21- 0 026... - Done • :irF • =1� ~ Ji' • 'li _fi • ai ■ Um � alp •:tom WW#IIWI� ++�1wM1�4 SIR 1 MiF https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2Yil iMWl1 LWQ3YzUOZjQ1 MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk71'8*9b- Of WZ5 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook UP- 1- 00 .., v Done 1 1 l Ion -I. - - 1 ' L y ]L:1� 0 F— — — — — — — — — a1 TP �V -- 4 m 1 m � Sent from my (Phone https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2Yil iMWl1 LWQ3YzUOZjQ1 MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk7%'09�4' Of 4Z5 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff Jonathan Curth, Development Services Director Jessica Masters, Development Review Manager FROM: Gretchen Harrison, Planner DATE: CITY COUNCIL MEMO 2023-549 SUBJECT: Appeal: CUP-2023-0009: Conditional Use Permit (332 N. FLETCHER AVEJETG SHELF 3 LLC, 485): Submitted by JUSTIN GUNN for property located at 332 N. FLETCHER AVE. in WARD 1. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY — 8 UNITS PER ACRE and contains approximately 0.09 acres. The request is to use the residence as a short-term rental. RECOMMENDATION: City staff recommends approval and the Planning Commission recommends denial of a request for a conditional use permit for a short-term rental as described and shown below. BACKGROUND: The subject property is located near Mount Sequoyah, just northeast of the intersection of Dickson Street and Fletcher Avenue. The property is zoned RSF-8, Residential Single -Family, 8 Units per Acre, contains 0.09 acres, and is currently developed with a two -bedroom townhome. On April 20, 2021, City Council adopted an ordinance to regulate short-term rentals operating within its limits. On December 20, 2022, City Council amended the ordinance to enact new requirements for short-term rentals. This report reflects those new changes for consideration. Request: The applicant requests conditional use permit approval to use the property as a Type 2 short-term rental, which are those not occupied by a permanent resident. Type 2 short-term rentals are subject to density limitations, including a 2% city-wide cap, and restrictions on the number of units that may be used as a short- term rental in multi -family dwelling complexes. Findings: Staff finds that granting the requested conditional use is unlikely to negatively impact the public interest. Minimal disruptions are expected for neighbors due to applicable business licensing requirements, including a required building safety inspection, and applicable density caps limiting the maximum number of guests to eight. Two off-street parking spaces are available in an existing detached carport. On -street parking is also available along the east side of Fletcher Avenue. Within a quarter mile of the property, city business license records indicate there are three active Type 2 short-term rental business licenses. There are no active or prior zoning code violations at the subject address. DISCUSSION: Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 375 of 425 At the February 27, 2023, Planning Commission meeting, a motion to deny this item passed with a vote of 7-1- 0. Commissioner Winston made the motion with a second from Commissioner Garlock. Commissioner Sparkman voted against the denial. Commissioners expressed concerns about approving a Type 2 short-term rental in a new development that was originally marketed as affordable housing, suggesting that it may adversely impact the character of this development and the surrounding neighborhood. Six members of the public spoke at the meeting in opposition to this request. Those who spoke expressed concerns about the underlying development, noting continued problems with increased water run off, storage of residential trash carts, and parking. They also raised questions about this development being originally touted as attainable workforce housing and felt that approval of a Type 2 short-term rental would adversely impact the residential character of the area. BUDGET/STAFF IMPACT: N/A ATTACHMENTS: Appeal Letter with Council Member Sponsors, Exhibit A, Planning Commission Staff Report Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 376 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-549 Appeal: CUP-2023-0009: Conditional Use Permit (332 N. FLETCHER AVEJETG SHELF 3 LLC, 485): Submitted by JUSTIN GUNN for property located at 332 N. FLETCHER AVE. in WARD 1. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY — 8 UNITS PER ACRE and contains approximately 0.09 acres. The request is to use the residence as a short-term rental. A RESOLUTION TO GRANT THE APPEAL OF COUNCIL MEMBERS SCOTT BERNA, HOLLY HERTZBERG, AND D'ANDRE JONES AND APPROVE CONDITIONAL USE PERMIT CUP 2023- 009 FOR A SHORT-TERM RENTAL AT 332 NORTH FLETCHER STREET WHEREAS, on February 27, 2023, the Planning Commission denied the application for Conditional Use Permit CUP 2023-009, to allow a Short -Term Rental at 332 North Fletcher Street; and WHEREAS, Council Members Holly Hertzberg, D'Andre Jones, and Scott Bema have properly appealed the decision of the Planning Commission pursuant to § 155.05(A)(3) of the Unified Development Code. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby grants the appeal of Council Members D'Andre Jones, Holly Hertzberg and Scott Berna, finds that the proposed short term rental is compatible with adjacent properties and other property in the zoning district, and approves Conditional Use Permit CUP 2023-009 for a Short -Term Rental at 332 North Fletcher Street. Section 2: Approval of the conditional use permit is subject to the following conditions: 1. A business license must be obtained within one year of conditional use permit approval. 2. The number of occupants is limited to a maximum of two people per bedroom, plus two, for the entire unit when the property is operated as a short-term rental. 3. Special events including, but not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars are prohibited from occurring in the short term rental. 4. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. 5. All trash receptacles shall be screened from view of the right-of-way. 6. All outdoor lighting shall meet requirements as outlined in UDC Chapter 176, Outdoor Lighting. 7. Any signage shall meet the requirements as outlined in UDC Chapter 174, Signs. Page 1 Page 377 of 425 City Council Members, Please accept this as our request of appeal for CUP STIR II (denied on 2/27). Justin & Sheri Gunn —1 & S Legacy Builders LLC — CUP 2023-0009 332 N. Fletcher, Fayetteville AR 72701 Our application was presented with an approval recommendation by City Council then denied by the Planning Commission after neighbors shared concerns. Neighbors voiced concerns relating to parking, traffic, density, affordable housing, previous builder complaints, trash pickup, and the fact that our home is a new construction build. All of these statements seem to stem from fear, what ifs, and opinions. We ask for this appeal based on the following information: 1. Parking — Each unit has two designated off-street parking spots as required by (building code/planning?) when built. STIR parking needs are no different than long term rental or owner -occupied homes. The average 12-month occupancy rate in Fayetteville is 34% which means that 66% of the time there will be NO parked vehicles other than occasional owner occupancy. 2. Traffic - STIR traffic is no different than long term rental or owner -occupied homes. Given the fact the home is not occupied 100% of the time, this will create less traffic than an average long-term rental or owner -occupied home. We can also assume that when these homes went through the planning department that traffic patterns were studied and approved for the development to be built. 3. Density - We are unaware of any density requirements to be permitted for an STR in Fayetteville other than the 2% city wide maximum cap of permits. We understand the CUP requirement is 2% city wide, not per neighborhood or per street. It's our understanding that this cap has not been met making our home eligible for approval in this category. During the meeting that our CUP was denied, other similar properties were approved. 4. Affordable/Available Housing —We are unaware of any "affordable housing" requirements to be permitted for an STIR in Fayetteville. Many STRs have been approved that cost much less than this price point as well. 5. Builder issues/complaints — Neighbors expressed dissatisfaction regarding the builder of our home. The stated issues were trees being cut down during construction, water drainage, and dust during construction. We are unable to address these complaints nor are we aware of any requirements regarding previous builders that would have bearing on the CUP approval process for my home. 6. Trash —We have a contract with the city waste removal and have both trash and recycle containers for our guests. Additionally, every time a guest checks out our company ensures trash is taken out and cans returned to the back of the home. My neighbors will be able to get in touch with me and my property management company at any time. This will prevent any trash concerns. Page 378 of 425 7. Development Neighbors —We are unaware of any restrictions on STIR use in this neighborhood. There is no HOA and no restrictive covenants to prevent STIR use. We specifically validated that short term rentals would be allowed with the developer and real estate agent during our purchase. 8. New vs. Old homes - Planning members stated their decision was based on "new housing should not be included as an STR". Yet during this same meeting, new homes were approved. I am unaware of any "new housing" restrictions that would prevent our home from approval in this process. It seems very clear in reviewing the meeting that each Planning Committee member is applying their own additional requirements such as street level density, age of home, traffic, housing affordability, etc. and simply echoing the opinions of the neighbors. None of which are requirements that I can find, in obtaining a CUP for my home. We urge you to review this meeting to confirm as well (begins at 2:47 mark). We believe the Commission Chair, Sarah Sparkman, believed that the council was acting out of their authority and unfairly when she went on record stating: 1 take a very narrow view of what our role is as a planning commission. Looking at what the city council has set forth for what we consider in the Short -Term Rentals. The concerns given by everyone here tonight and shared by me are concerns we have anytime that this type of permit comes forward and 1 don't think it is unique to any piece of property. The city has decided this is something that is going to be permitted in the city. How this is defined under city ordinance, seeing what city council has done on appeal for decisions we've made and just looking for consistency on the way we have done things in the past, 1 am voting in Favor Overall, we're looking for a fair and legal process for submission and adjudication of applications. We are not, as was intoned in the meeting, a wealthy LLC looking to make a lot of money. We are a family with roots in the city that simply would like the option to rent our home when it's not in use which is a constitutional right in the state of Arkansas just as any other property owner would be afforded. Below is a section from a memo sent from Fayetteville city attorney, Blake Pennington — August 8, 2022. It was titled "Factors to Consider for CUPs and Application for Short Term Rentals. As we reviewed the memo, it confirmed that our property is in -line to be approved; as the city representative recommended. See below: The Planning Commission must take into account the concerns of neighbors and ensure that a use is not unreasonably disruptive and incompatible with the neighborhood. Without -.a history of violations or disruptions to the neighborhood, it would be difficult for the Planning Commission to determine the proposed use is incompatible with the neighborhood. Page 379 of 425 Our home is one of 10 which are newly constructed homes with a majority vacant currently. There is no known disruptions nor known incompatibility within the neighborhood as evidenced by other CUP/STR approval within close proximity. Please accept this letter as our formal request to appeal the Planning Committee denial of our CUP. We are simply seeking a fair and legal review of our application based upon your current CUP requirements. In closing, our "ask" is seeking your sponsorship in our appeal. Respectfully, Justin & Sheri Gunn Page 380 of 425 Paxton, Kara From: Justin Gunn <Justin.Gunn@gilead.com> Sent: Monday, March 13, 2023 7:09 AM To: Harrison, Gretchen Cc: Justin Gunn Subject: FW: Appeal Request - CUP 2023-0009 CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Gretchen, Please find an email of support for my appeal. Please confirm my next action is forwarding to you. Also, is there a deadline on getting support for my appeal? I am following up with several who have not responded as of yet. Thanks Justin Gunn Gilead Sciences From: Berna, Scott <scott.berna@fayetteville-ar.gov> Sent: Monday, March 13, 2023 5:00 AM To: Justin Gunn <Justin.Gunn@gilead.com> Subject: [EXTERNAL] Re: Appeal Request - CUP 2023-0009 I will support allowing your appeal to be heard. Scott Berna On Mar 12, 2023, at 7:31 PM, Justin Gunn <Justin.Gunn@gilead.com> wrote: CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Scott, I have not sent through the city clerks office. I did speak with Gretchen and the City Attorney and both stated to send directly to the members. With the people willing to sponsor, I was to forward to them directly (city planning coodinators). Apologize if I am missing anything. If you will support my appeal, I will forward as requested. I really appreciate your response as we have until EOD tomorrow/Monday. Would really appreciate your support or willingness to speak with me. Regards, 1 Page 381 of 425 Justin Gunn From: Berna, Scott <scott.berna@favetteville-ar.gov> Sent: Sunday, March 12, 2023 4:27 PM To: Justin Gunn <Justin.Gunn@gilead.com> Subject: [EXTERNAL] Re: Appeal Request - CUP 2023-0009 Have you sent your appeal request through he city clerks office? I don't show a email being sent out through her office just the email I received from you. Scott On Mar 10, 2023, at 10:21 AM, Justin Gunn <Justin.Gunn@gilead.com> wrote: CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Council Member Berna, I'm following up on my original email to ensure you received my request and am hopeful for your response. Regards, Justin Gunn From: Justin Gunn <Justin.Gunn@gilead.com> Sent: Saturday, March 04, 2023 9:06 AM To: scott.berna@fayetteville-ar.gov Cc: Justin Gunn <Justin.Gunn@gilead.com> Subject: Appeal Request - CUP 2023-0009 Dear Council Member Berna, I am writing this email to request your consideration to sponsor an appeal to CUP-2023- 0009. My wife and I are requesting that our home, located at 332 N. Fletcher in Fayetteville, be allowed a license to operate as a Type 2-Short Term Rental. As a back -drop, Sheri and I are both graduates of the UofA and proud that our triplet children recently graduated as Razorbacks in May of 2022. During that last 4 years, we have truly fallen back in love with NW Arkansas. In the process, we have invested in 3 long-term rental properties that are located in areas of working professionals. The request for this property mentioned above provides 3 long-term objectives for us: 1. We are proud to provide a nice and well -kept home for families who are visiting Fayetteville. 2. We are looking to move back to Fayetteville in the future and want to participate in facilitating a great NW AR experience. Page 382 of 425 For the first time in 23 years, our family is living apart (triplets in 3 cities). This house will stand as our home -base when we can all come together. Lastly, we have owned and managed properties for over 20 years and have established a respectable home/brand for our renters and ensure alignment with rules, regulations, and professional expectations Enclosed you will find additional details regarding our appeal. We would be very grateful for you to support this appeal. Regards, Sheri & Justin Gunn <AppealRequestCUP2023-0009Final.docx> Page 383 of 425 CityClerk From: Paxton, Kara Sent: Monday, March 13, 2023 2:31 PM To: CityClerk Subject: Berna - Support Verification Good afternoon, I received a verbal confirmation from Council Member Berna that he supports the appeal of the denial of the CUP 2023- 0009. Council Member Berna will follow up at a later time with an email to be attached for additional verification. Thank you, Kara Paxton MSISM, MMC, CAMC, CMO City Clerk Treasurer City of Fayetteville, Arkansas kanaxtonnfavetteville-ar. ciov T 479.575.8323# CITY Of FAVETrIVILL■ Page 384 of 425 Paxton, Kara From: Hertzberg, Holly Sent: Monday, March 13, 2023 1:05 PM To: Justin Gunn Cc: Paxton, Kara Subject: Re: FW: Appeal Request - CUP 2023-0009 Mr. Gunn, I will be one of the sponsors on this item to allow you present your case the council. Thank you! Holly Hertzberg City Council Member Ward 4 Position 2 Fayetteville, AR 72701 holly. hertzberg@fayetteville-ar.gov 479.777.1758 On Mar 13, 2023 at 1:01 PM, <Justin Gunn> wrote: CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Council Member Hertzberg, My apologies for the multiple emails regarding my request for support of appeal. I'm sending one more time as my time expires at 5pm today to have a minimum of 3 council members support my appeal. As you read below (and within the document), this meeting seemed to be influenced on situations/builders before me. I am only asking to be heard as I met the requirements and the requirements moved during the meeting. I would greatly appreciate your support and asking for the council to hear my story. If you will support, please reply by 5pm today so that I may forward to the appropriate people in Fayetteville. If you would like to discuss, please call me at the number below Regards, Justin Gunn 650-576-3549 From: Justin Gunn Sent: Friday, March 10, 2023 7:21 AM To: holly.hertzberg@fayetteville-ar.gov Subject: FW: Appeal Request - CUP 2023-0009 Council Member Hertzberg, Page 385 of 425 I'm following up on my original email to ensure you received my request and am hopeful for your response. Regards, Justin Gunn From: Justin Gunn <Justin.Gunn@gilead.com> Sent: Saturday, March 04, 2023 9:10 AM To: holly.hertzberg@fayetteville-ar.gov Cc: Justin Gunn <Justin.Gunn@gilead.com> Subject: Appeal Request - CUP 2023-0009 Dear Council Member Hertzberg, I am writing this email to request your consideration to sponsor an appeal to CUP-2023-0009. My wife and I are requesting that our home, located at 332 N. Fletcher in Fayetteville, be allowed a license to operate as a Type 2-Short Term Rental. As a back -drop, Sheri and I are both graduates of the UofA and proud that our triplet children recently graduated as Razorbacks in May of 2022. During that last 4 years, we have truly fallen back in love with NW Arkansas. In the process, we have invested in 3 long-term rental properties that are located in areas of working professionals. The request for this property mentioned above provides 3 long-term objectives for us: 1. We are proud to provide a nice and well -kept home for families who are visiting Fayetteville. 2. We are looking to move back to Fayetteville in the future and want to participate in facilitating a great NW AR experience. 3. For the first time in 23 years, our family is living apart (triplets in 3 cities). This house will stand as our home -base when we can all come together. Lastly, we have owned and managed properties for over 20 years and have established a respectable home/brand for our renters and ensure alignment with rules, regulations, and professional expectations Enclosed you will find additional details regarding our appeal. We would be very grateful for you to support this appeal. Regards, Sheri & Justin Gunn Page 386 of 425 Paxton, Kara From: D'Andre Jones <dre91732000@gmail.com> Sent: Monday, March 13, 2023 4:17 PM To: Paxton, Kara Subject: Sponsor appeal CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. Hey Kara I would like to sponsor cup 2023 -0009 appeal! 332 N Fletcher!! Sent from my Whone Page 387 of 425 CUP-2023-0009 Close Up View UTTOWST DICKSON W Q LIJ J 0 RMF PRING-ST 332 N. FLETCHER AVE RSF-4 w/ a/ w/ v/ J / LL / DICKSON C TD Subject Property Neighborhood Link Alley Residential Link Feet Hillside -Hilltop Overlay District Planning Area 0 75 150 300 r � ; Fayetteville City Limits 1 :2,400 450 600 EXHIBIT 'A' RSF-4 RSF-8 RSF-18 RMF-6 RMF-24 P-1 Page 388 of 425 CITY OF FAYETTEVILLE I\. ARKANSAS PLANNING COMMISSION MEMO TO: Fayetteville Planning Commission THRU: Jessie Masters, Development Review Manager FROM: Gretchen Harrison, Planner MEETING DATE: February 27, 2023 (Updated with results) SUBJECT: CUP-2023-0009: Conditional Use Permit (332 N. FLETCHER AVE./ETG SHELF 3 LLC, 485): Submitted by JUSTIN GUNN for property located at 332 N. FLETCHER AVE. The property is zoned RSF-8, RESIDENTIAL SINGLE-FAMILY — 8 UNITS PER ACRE and contains approximately 0.09 acres. The request is to use the residence as a short-term rental. RECOMMENDATION: Staff recommends approval of CUP-2023-0009 with conditions as outlined by staff. RECOMMENDED MOTION: "I move to approve CUP-2023-0009, determining: In favor of compatibility with adjacent properties, and In favor of all other conditions as recommended by staff. " BACKGROUND: The subject property is located near Mount Sequoyah, just northeast of the intersection of Dickson Street and Fletcher Avenue. The property is zoned RSF-8, Residential Single -Family, 8 Units per Acre, contains 0.09 acres, and is currently developed with a two -bedroom townhome. On April 20, 2021, City Council adopted an ordinance to regulate short-term rentals operating within its limits. On December 20, 2022, City Council amended the ordinance to enact new requirements for short-term rentals. This report reflects those new changes for consideration. Surrounding land use and zoning are depicted in Table 1. Table 1: Surrounding Land Use and Zoning Direction Land Use Zoning North Two -Family Residential RSF-8, Residential Single -Family — 8 Units per Acre South Single -Family Residential RSF-8, Residential Single -Family — 8 Units per Acre East Single -Family Residential RSF-4, Residential Single -Family — 4 Units per Acre West Single -Family Residential RSF-4, Residential Single -Family — 4 Units per Acre City Plan 2040 Future Land Use Designation: Residential Neighborhood Proposal: The applicant requests conditional use permit approval to use the property as a Type 2 short-term rental, which are those not occupied by a permanent resident. Type 2 short-term rentals are subject to density limitations, including a 2% city-wide cap, and restrictions on the number of units that may be used as a short-term rental in multi -family dwelling complexes. Page 389 of 425 Public Comment: Staff received public comment in opposition to this request from an individual who expressed concerns about this short-term rental adversely impacting the residential character of the neighborhood. Their letter is attached for reference. RECOMMENDATION: Staff recommends approval of CUP-2023-0009 with the following conditions: Conditions of Approval: Planning Commission determination of compatibility. Staff finds the proposed short- term rental to be compatible with the neighborhood based on the findings in this report. 2. Approval of the conditional use permit does not ensure approval of a business license application. The applicant must still be able to comply with all other applicable requirements in city code. 3. Per UDC §166.20, Expiration of Approved Plans and Permits, a business license must be obtained within one year of conditional use permit approval. 4. Per ordinance, the number of occupants is limited to a maximum of two people per bedroom, plus two, for the entire unit when the property is operated as a short-term rental. 5. Special events including, but not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars are prohibited from occurring in the short- term rental. 6. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. 7. All trash receptacles shall be screened from view of the right-of-way. 8. All outdoor lighting shall meet requirements as outlined in UDC Chapter 176, Outdoor Lighting. 9. Any signage shall meet the requirements as outlined in UDC Chapter 174, Signs. PLANNING COMMISSION ACTION: Required YES Date: February 27, 2023 O Tabled O Approved 0 Denied Motion: Winston ISecond: Garlock jVote: 7-1-0 (motion to deny) Page 390 of 425 FINDINGS OF THE STAFF §163.02. AUTHORITY; CONDITIONS; PROCEDURES. B. Authority; Conditions. The Planning Commission shall: 1. Hear and decide only such special exemptions as it is specifically authorized to pass on by the terms of this chapter. 2. Decide such questions as are involved in determining whether a conditional use should be granted; and, 3. Grant a conditional use with such conditions and safeguards as are appropriate under this chapter; or 4. Deny a conditional use when not in harmony with the purpose and intent of this chapter. C. Procedures. A conditional use shall not be granted by the Planning Commission unless and until: 1. A written application for a conditional use is submitted indicating the section of this chapter under which the conditional use is sought and stating the grounds on which it is requested. Finding: The applicant has submitted a written application requesting a conditional use permit for a Type 2 short-term rental in RSF-8 zoning. 2. The applicant shall pay a filing fee as required under Chapter 159 to cover the cost of expenses incurred in connection with processing such application. Finding: The applicant has paid the required filing fee. 3. The Planning Commission shall make the following written findings before a conditional use shall be issued: (a.) That it is empowered under the section of this chapter described in the application to grant the conditional use; and Finding: The Planning Commission is empowered under City Code §118.01(E)(2) to grant the requested conditional use permit. (b.) That the granting of the conditional use will not adversely affect the public interest. Finding: Staff finds that granting the requested conditional use is not likely to affect the public interest given the applicable business license requirements, including a required building safety inspection, and applicable density caps on Type 2 short-term rentals. (c.) The Planning Commission shall certify: (1.) Compliance with the specific rules governing individual conditional uses; and Page 391 of 425 Finding: There are specific rules governing Short -Term Rentals, as follows: §163.18. SHORT-TERM RENTALS. A. Residential Zoning Districts. Type 2 short-term rentals may be permitted as a conditional use in the following residential zoning districts: R-A, RSF-.5, RSF-1, RSF-2, RSF-4, RSF-7, RSF-8, RSF-18, RI-12, RI-U, RMF-6, RMF-12, RMF-18, RMF-24, RMF-40, and NC. Short term rentals may be permitted by right or by conditional use in planned zoning districts subject to the zoning regulations enacted by the City Council for each district. Short-term rentals in non-residential zoning districts, mixed use zoning districts, or other zoning districts not listed above are not required to apply for a conditional use permit. Finding: The request is to operate a Type 2 short-term rental in RSF-8 zoning. Since RSF-8 is a residential zoning district, a conditional use permit is required. B. Occupancy. Maximum of two (2) people per bedroom, plus two (2), for the entire unit when operated as a short-term rental. Finding: Occupancy is limited as described in UDC §163.18(B). Occupancy limitations are confirmed by the applicant during licensing. Since this townhome contains three bedrooms, occupancy will likely be limited to a maximum of eight guests. C. Parking. Parking is limited to the maximum number of vehicles as allowed by the underlying zoning district for the residential building on the property. Finding: Parking is limited as described in UDC §163.18(C). Parking for townhomes is required to be provided at a rate of one vehicle space per bedroom. According to the applicant, the unit has three bedrooms and two covered parking spaces available in the back of the property. On -street parking is also available along Fletcher Avenue. D. Special events are not permitted in a short-term rental. Example of special events include, but are not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars. Finding: The applicant's request letter suggests the property will comply with the City's regulations for a short-term rental. As a condition of approval, staff recommends a prohibition on special events. E. Short-term rental units are allowed in any structure established as a permanent residential dwelling including an accessory dwelling unit. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. Finding: The application is for use of the property at 332 N. Fletcher Ave. Staff recommends a condition confirming that no recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. Page 392 of 425 F. Exceptions. Exceptions to the short-term rental standards, except proposals that would exceed the city-wide density maximum, may be granted by the Planning Commission as a conditional use permit. Finding: Type 2 short-term rentals are subject to a city-wide density cap at 2% of total dwelling units, as determined by United States Census Bureau data. Recently released five-year American Community Survey data from 2021 lists total housing units in Fayetteville at 44,706, which puts the cap at 894 total Type 2 short-term rentals. To date, the City has issued 311 Type 2 short- term rental licenses that are subject to this cap. Hotel/motel uses are not permitted by right in the underlying RSF-8 zoning, so this short-term rental would contribute to the city-wide density cap. While this short-term rental is in a multi -unit structure, it is not subject to a building density cap since all units are on individual lots of record. No exceptions to the short-term rental standards are being requested with this conditional use permit. G. Short-term rentals must comply with all applicable codes under City Code §118.01 and successfully obtain a business license prior to operation. Finding: This short-term rental would be subject to all regulations in City Code §118.01 that apply to Type 2 short-term rentals in residential zoning districts. Applicable business licensing requirements will be reviewed by staff and confirmed by the applicant at the time of licensing. H. Short-term rentals in residential zoning districts may be subject to denial or additional conditions based upon the Planning Commission's findings on the following factors: 1. Adequate parking infrastructure; 2. Adequate adjoining or nearby streets for on -street parking; 3. Frequency or concentration of nearby licensed Type 2 short-term rentals; and 4. Prior zoning or code violations. Finding: There appears to be adequate parking available to support the use of the property as a short-term rental based on the applicant's submittal. A total of two spaces are available in a carport and a maximum of eight guests are permitted. The property also has frontage along a portion of Fletcher Avenue that is wide enough to support on -street parking. City business license records indicate that three other units within a quarter -mile radius of the property have active Type 2 short-term rental business licenses. No prior zoning or code violations have been reported at this location. §163.02. AUTHORITY; CONDITIONS; PROCEDURES. (continued) (2.) That satisfactory provisions and arrangements have been made concerning the following, where applicable: (a.) Ingress and egress to property and proposed structures thereon with particular reference to automotive and pedestrian safety and convenience, Page 393 of 425 traffic flow and control and access in case of fire or catastrophe; Finding: The subject property has access to Fletcher Avenue through a shared private driveway and there is sidewalk present along the property's frontage. Staff finds that the proposal will not adversely affect traffic flows considering the use of the property would be limited to a maximum of eight guests, which would not be out of character with use of the property for residential purposes. (b.) Off-street parking and loading areas where required, with particular attention to ingress and egress, economic, noise, glare, or odor effects of the special exception on adjoining properties and properties generally in the district; Finding: The applicant has indicated that there are two guest vehicle parking spaces available in an existing carport. The short-term rental ordinance limits the number of guest vehicles to the maximum number of vehicles as allowed by the underlying zoning district. (c.) Refuse and service areas, with particular reference to ingress and egress, and off-street parking and loading; Finding: The applicant proposes to utilize existing residential trash cart service. Staff recommends that the containers should be screened from public view when not at the curb for residential pick-up. (d.) Utilities, with reference to locations, availability, and compatibility; Finding: Utilities are currently available to the site and the use as a short-term rental is not anticipated to impact the provision of utilities. (e.) Screening and buffering with reference to type, dimensions, and character; Finding: Staff recommends that residential carts be screened so that they are not visible from the public right-of-way. (f.) Signs, if any, and proposed exterior lighting with reference to glare, traffic safety, economic effect, and compatibility and harmony with properties in the district; Finding: Any proposed signage will be subject to UDC Chapter 174, Signs, and all regulations therein. (g.) Required yards and other open space; and Page 394 of 425 Finding: Based on the applicant's submittal, the structure is meeting relevant setbacks. (h.) General compatibility with adjacent properties and other property in the district. Finding: Staff finds the proposed use to be compatible with surrounding properties. The property is surrounded by residential uses, and short-term rentals are permitted by right in RSF-8 zoning. There appears to be adequate parking to accommodate the number of permitted guests, and staff does not anticipate any adverse traffic impacts with this request. Since the RSF-8 zoning district does not allow hotel/motel uses by right, this short-term rental would contribute to the city-wide density cap. BUDGET/STAFF IMPACT: None ATTACHMENTS: • Business Regulations o §118.01 Applicability • Unified Development Code o §161.09 District RSF-8, Residential Single -Family — Eight (8) Units Per Acre o §163.18 Type 2 Short -Term Rentals in Residential Zoning Districts • Applicant Request Letter • Building Floor Plans • Site Plan • Building Elevation • Public Comment • One Mile Map • Close -Up Map • Current Land Use Map • STRs within '/4 Mile Map Page 395 of 425 118.01 Applicability (E) Short -Term Rentals. A residential dwelling unit, portion of a dwelling unit, or bedroom within a residential dwelling unit, leased and/or rented to a guest(s), for a period of less than thirty consecutive (30) days. (1) Short -Term Rental, Type 1. A short-term rental where the principal use of the property remains as a full- time residence. The occupants or owner rent their primary residence as a short-term rental. A copy of the Homestead Tax Credit or long-term lease agreement for the subject property is required to be classified as a Type 1 rental. The occupant or owner must occupy the residence for nine (9) months of the year. Accessory dwelling units (ADUs) as defined in Unified Development Code Chapter 151 shall be considered a Type 1 short-term rental. (2) Short -Term Rental, Type 2. A short-term rental that is not occupied by a permanent resident. The owner lists this property full-time as a short-term rental and has no intention of having permanent residents living in the property. A conditional use permit is required for a Type 2 short-term rental in a residential zoning district prior to the city issuing a business license. (3) License Required. No dwelling unit in the city shall be used as a short-term rental unless: (a) The owner of the dwelling unit or operator of the short-term rental possess a valid and current business license for the dwelling unit, and fully complies with all legal requirements and duties imposed herein with respect to each and every short-term rental; and (b) The owner has designated an agent, where said agent fully complies with all legal requirements and duties imposed herein with respect to every short-term rental. The owner may serve as their own agent. (c) The owner of the dwelling unit or operator of the short-term rental provides proof of a valid and current homeowners insurance rider policy which fully covers each unit when operated as short-term rental unit. (4) A separate business license shall be required for each dwelling unit used as a short-term rental. (5) Any change in ownership requires a new or amended business license. (6) If any required contact information changes for the associated business license, the person to whom the license was issued shall immediately notify the Development Services Department in writing. (7) License Application. The application for a business license shall include at minimum, the following information from applicants: (a) The property owner's information including legal name, mailing address, immediate contact phone number, and immediate contact E-mail address. (b) Information for the dwelling unit subject to the application, inclusive of the physical street address assigned by the city. (c) The type and total number of dwelling units located on the lot of record containing the dwelling unit subject to the application. (d) If the owner is not their own agent, the owner designated agent's information including legal name, mailing address, immediate contact phone number and immediate contact E-mail address. (e) Documentation of approval of a life safety and egress inspection by the City Building Safety Division for the dwelling unit subject to the application. (f) Proof of application for remittance of hotel, motel and restaurant tax to the City of Fayetteville, and verification that all sales, use, and hotel, motel and restaurant taxes are current. (g) Any additional data as deemed necessary or desirable for permit approval by the Development Services Director. (8) License Renewals. Business licenses for short-term rentals shall be renewed in accordance with Chapter 118 of the Business Regulations (Business Registry and Licenses). (11) Legal Duties of License Holders. An owner possessing a short-term rental license shall comply at all times with the following requirements: (a) Occupancy. Short-term rentals shall be subject to, and may not exceed, the occupancy limits approved with the business license. (b) Advertisements. A short-term rental shall not be advertised if it violates occupancy, density, safety, and any of the other provisions of the Fayetteville Code. No short-term rental unit shall be advertised prior to having obtained a business license and the business license number shall be included in the advertisement listing. (c) Information and Posting. Business licensees shall provide to guests and post conspicuously in the common area of the short-term rental unit the city phone number to report a safety complaint. (10) Owner or AgentAccessibility. The property owner shall ensure that they or a designated agent are available at all times during guest occupancy, including nights and weekends, in order to facilitate compliance with Page 396 of 425 this section. For the purposes of these regulations, 'availability' means that the owner or agent is accessible by telephone, and, able to be physically present at the short-term rental within three (3) hours of being contacted. (11) Guest Records. The owner shall maintain summary guest registration records, which shall contain the actual dates of occupancy, total number of guests per party per stay, and the rate(s) charged, but shall not contain any personally identifiable information about guests. Such records shall be maintained forth ree (3) years and shall be provided to the City upon request. (12) Health and Safety. The owner shall ensure that each dwelling unit governed by this section complies with the applicable provisions of the Unified Development Code Chapter 173, Building Regulations. (13) Criminal Activity. The owner shall timely report any known or reasonably suspected criminal activity by a guest to the Fayetteville Police Department within twelve (12) hours maximum. (14) Taxes and Fees. Except for those instances in which a hosting platform bears the responsibility for collecting and remitting taxes and fees applicable to short-term rentals, the property owner shall timely remit in full Fayetteville Hotel, Motel and Restaurant tax and other applicable local, state, and federal taxes and city fees owed in connection with any short-term rental. The failure of a hosting platform to collect and remit taxes and fees shall not relieve an owner of the obligation to pay taxes and fees owed pursuant to this section. (15) Authorization to Occupy, Use, and Operate. Authorization to operate a short-term rental may be granted by the Development Services Director through the issuance of a City of Fayetteville Business Registry and License (Business License). (16) Density For Type 2 Short -Term Rentals. A city-wide density cap of 2% of all dwelling units in the Fayetteville city limits may be utilized as Type 2 rentals. Total dwelling units are determined from current United States Census Bureau and/or American Community Survey numbers, whichever number is higher. A conditional use permit may not permit: (a) More Type 2 short-term rentals than what is allowed by the city-wide density cap. Type 2 short-term rentals in commercial and mixed -use zoning districts where hotel/motels are permitted by right shall not contribute to the city-wide density cap. (b) More than 10% or a single unit whichever is greater; of total dwelling units as Type 2 rentals within a multi -family dwelling complex. (c) Individual 2-, 3- and 4-family buildings that are owned by the same person or entity and are not a part of a multi -family complex shall have no more than one (1) Type 2 short-term rental unit per building complex. (d) Where attached residential units are held separately through condominium association, horizontal property regime, fee simple, or similar ownership structure, no cap shall be applied to buildings with attached residential dwellings. Structures of attached residential dwellings where applicants seek more than 10% of total units for licensing as Type 2 rentals shall be evaluated by the Building Safety Director and/or Fire Marshal for adequate fire protection as defined by the adopted Arkansas Fire Prevention Code. Where inadequate fire protection is identified, improvements may be required prior to issuance of a business license. (17) Suspension and Revocation. If the Development Services Director has reason to believe that any of the grounds specified in §118.03(A) of the Fayetteville Code exist, or that any rental unit was rented for less than one (1) full night, or to more than one (1) part of guests for the same period of time, or otherwise failed to comply with all terms and conditions of this section, the Development Services Director may suspend or revoke the short-term rental's business license pursuant to the procedures detailed in §118.03 and in §118.04 of the Fayetteville Code. (20) Short-term rentals must comply with all applicable codes under Unified Development Code §163.18 and § 164.26 successfully obtain a business license prior to operation. ( Ord. No. 6427, §§l(Exh. A), 2, 4-20-21; Ord. No. 6505, §1(Exh. A), 11-16-21; Ord. No. 6521 , §§1, 2, 1-18-22; Ord. No. 6537 , §1(Exh. A), 2-15-22) Page 397 of 425 161.09 District RSF-8, Residential Single -Family - Eight (8) Units Per Acre (A) Purpose. The RSF-8 Residential District is designed to bring historic platted development into conformity and to allow for the development of new single family residential areas with similar lot size, density, and land use as the historical neighborhoods in the downtown area. (B) Uses. (1) Permitted Uses. Unit 1 City-wide uses by right Unit 8 Single-family dwellings Unit 41 Accessory dwellings Unit 46 Short-term rentals (2) Conditional Uses. Unit 2 City-wide uses by conditional use permit Unit 3 Public protection and utility facilities Unit 4 Cultural and recreational facilities Unit 5 Government facilities Unit 9 Two-family dwellings Unit 12a Limited business Unit 24 Home occupations Unit 36 Wireless communications facilities Unit 44 Cluster Housing Development (C) Density. By Right Single-family dwelling units per 8 or less acre (D) Bulk and Area Regulations. (1) Lot Width Minimum. Single-family 50 feet Two 2 family 50 feet Townhouse, no more than two 2 attached 25 feet (2) Lot Area Minimum. Single-family 5,000 square feet Two-family 5,000 square feet (3) Land Area Per Dwelling Unit. Single-family 5,000 square feet Two-family 5,000 square feet Townhouse, no more than two 2 attached 2,500 square feet (E) Setback Requirements. Front Side Rear 15 feet 5 feet 5 feet (F) Height Regulations. Building Height Maximum 3 stories Page 398 of 425 (G) Building Area. The area occupied by all buildings shall not exceed 50% of the total lot area, except when a detached garage exists or is proposed; then the area occupied by all buildings shall not exceed 60% of the total lot area. Accessory ground mounted solar energy systems shall not be considered buildings. (Ord. No. 4783, 10-18-05; Ord. No. 5028, 6-19-07; Ord. No. 5128, 4-15-08; Ord. No. 5224, 3-3-09; Ord. No. 5312, 4- 20-10; Ord. No. 5462, 12-6-11; Ord. No. 5921 , §1, 11-1-16; Ord. No. 5945 , §8, 1-17-17; Ord. No. 6015 , §1(Exh. A), 11-21-17; Ord. No. 6245 , §2, 10-15-19; Ord. No. 6427 , §§l(Exh. C), 2, 4-20-21) Ord. No. 6427 , § 2, adopted April 20, 2021, "determines that this ordinance and all amendments to Code sections ordained or enacted by this ordinance shall automatically sunset, be repealed, terminated, and become void twenty (20) months after the passage and approval of this ordinance, unless prior to that date, the City Council amends this ordinance to repeal this sunset, repeal and termination section." Page 399 of 425 163.18 Type 2 Short -Term Rentals in Residential Zoning Districts (A) Residential Zoning Districts. Type 2 short-term rentals may be permitted as a conditional use in the following residential zoning districts: 1) R-A 2) RSF-.5 3) RSF-1 4) RSF-2 5) RSF-4 6) RSF-7 7) RSF-8 8) RSF-18 9) RI-12 10) RW 11) RMF-6 12) RMF-12 13) RMF-18 14) RMF-24 15) RMF-40 16) NC Short term rentals may be permitted by right or by conditional use in planned zoning districts subject to the zoning regulations enacted by the City Council for each district. Short-term rentals in non-residential zoning districts, mixed use zoning districts, or other zoning districts not listed above are not required to apply for a conditional use permit. (B) Occupancy. Maximum of two (2) people per bedroom, plus two (2), for the entire unit when operated as a short-term rental. (C) Parking. Parking is limited to the maximum number of vehicles as allowed by the underlying zoning district for the residential building on the property. (D) Special events are not permitted in a short-term rental. Example of special events include, but are not limited to, weddings, receptions, anniversaries, private parties, fundraisers and business seminars. (E) Short-term rental units are allowed in any structure established as a permanent residential dwelling including an accessory dwelling unit. No recreational vehicle, trailer, other vehicle or structure not classified as a permanent residential dwelling may be used as a short-term rental. (F) Exceptions. Exceptions to the short-term rental standards, except proposals that would exceed the city- wide density maximum, may be granted by the Planning Commission as a conditional use permit. (G) Short-term rentals must comply with all applicable codes under City Code §118.01 and successfully obtain a business license prior to operation. (H) Short-term rentals in residential zoning districts may be subject to denial or additional conditions based upon the Planning Commission's findings on the following factors: 1) Adequate parking infrastructure; 2) Adequate adjoining or nearby streets for on -street parking; 3) Frequency or concentration of nearby licensed Type 2 short-term rentals; and 4) Prior zoning or code violations ( Ord. No. 6427, §§l(Exh. E), 2, 4-20-21; Ord. No. 6505, §2(Exh. B), 11-16-21; Ord. No. 6537, §2(Exh. B), 2-15-22) Page 400 of 425 J & S Legacy Builders, LLC To Whom It May Concern, My wife and i arc requesting that our home, located at 332 N. Fletcher in Fayetteville, be allowed a license to operate as a Type 2-Short Term Rental. As a back -drop, Sheri and I are both graduates of the UofA and proud that our triplet children recently graduated as Razorbacks in May of 2022. During that last 4 years, we have truly fallen back in love with NW Arkansas. In the process, we have invested in 3 long-term rental properties that are located in areas of working professionals. The request for this property mentioned above provides two long-term objectives for us: 1. We are proud to provide a nice and well -kept home for families who are visiting Fayetteville. 2. We are looking to move back to Fayetteville in the future and want to participate in facilitating a great NW AR experience. Lastly, we have owned and managed properties for over 20 years and have established a respectable home/brand for our renters and ensure alignment with rules, regulations, and professional expectations Below you will find additional information regarding the property on 332 N. Fletcher: Legal Description New Lot 7A of the Lot Split Tiled for record in/as Document No.2021-22842 and described as follows: A part of Lots 6 and 7, Block 3, Mcllroy Addition to the City of Fayetteville, as per plat on file in the office of the Circuit Clerk and Ex-Officio Recorder of Washington County, Arkansas, being more particularly described as follows, to -wit: Commencing at an existing pipe marking the Northeast corner of said Block 3 and running thence along the East line thct:�of the foilowing: S02037'38"W 88.04 feet -to an existing rebar, S02158'30"W 87.96 feet to an existing rebur, S02149'08"W 37.00 feet to the true point of beginning, thence continuing along said East line S021149'08"W 28.00 feet, thence leaving said East line N86°53'38"W 144.97 feet to the East right-of-way of North Fletcher Avenue, thence along said right-of-way N02043'31"E 28.00 I'cet, thence leaving said right-of-way S86153'38"E 145.02 feet to the point of beginning, containing 0.9 acres, more or less. Additional Descriptions: - 332 N. Fletcher is a 3 BD & 2 %2 bath townhouse. The property is new construction and fully decorated. 1740 sq. feet — 2 story Newly painted dark green with a light red front door Property has front and back porch lighting Home shares one wall with similar structured townhouse. This is consistent with the project. 8 total townhomes attached by 2s. 2 covered parking spaces in back of property with access directly to back porch entrance. Installed 4 solar lights to provide appropriate lighting at night from home to auto. While homes have just recently been available to move in, the majority of homes are college students and/or parents 2nd homes with students at the UofA. Scanned with amCal­11­1�56ge401 of425 - Privacy fence around the back porch - Behind the parking lot there is a large (around I0 foot) wall and designated set - aside land where the builder has planted trees. Homes are not located directly behind the complex. - We will convey to tenants that noise is to be kept to a minimum to avoid any disruption to neighbors. - We have city services for waste removal and have both garbage and recycle containers In closing, we are excited about providing a great experience for visitors to Fayetteville. We have been investors/owners that have managed our properties for over 20 years. We run a very respectable family business and have a great brand in our homes and how they are managed/maintained, Enclosed are a few pictures of site location and floor plan. Respectfully submitted, J & S Legacy Builders LLC i C.� Just' Gunn Z� �J Sheri Gunn 'j/9 Scanned with CaMSCann56ge 402 of 425 muv im i cu 7MU . :ry TOUNHOMI t aasrnaw ... .. ........wv YA MNmwlTw f1a�vY I.v[s: ra�4q vao MOYI91➢f4 v.fmvi FIRST FLOOR PLAN r. SECOND FLOOR PLAN Scanned with amScarl l�56ge 403 of 425 ww •.• n s dM wr•.r� rwl"orlt / s � M 1 • UI�F ► f!� r_ lram ' 1 rr t+ ro"rnavl 336 332 330 '•• UeT TIFF C � •• • • W TYPE A TYPE B 20 21� 3BCD BEOwoo�. Row luja4l e i @avows % UMIM Jon rr r. ■ r r� � �rlrn rt .., Of N S 1PM+C OW Al ■.srrsr. wow . .. r s t ■..r�rrr. .r■ r ��.� 1'i'�T��1 rrrr rrI sew �r s� Scanned with CaM S 0 arl rl�56ge 404 of 425 Page 405 of 425 February 22, 2023 Fayetteville Planning Commission RE: CUP 2023- 008, 009, and 0018 Commission Members: This letter is to ask the Planning Commission not to approve the rezoning request to allow 332 North Fletcher, 344 North Fletcher and 348 North Fletcher to engage in short -termed rental agreements. These properties are currently zoned Residential/Single family. The plot of land that these Townhouses set on had 2 houses at one time. A couple of years ago the plot was rezoned to allow 8 units per acre (this would allow for 7 single family homes) to be built. The public was told this followed the theory of "filling the infield" with affordable housing. The houses were never built. Instead, the plan changed and 5 (2 units each) townhouses were built. Due to lack of full-time occupancy these units do not add to any kind of "community feel" and certainly do not contribute to alleviating the affordable housing need in Fayetteville. In addition, valuable infield space has been lost. Now the requests to allow short term rentals will be like having "hotels" in the infield. The owners of these units knew how they were zoned when they purchased them. To come in and attempt to change that shows a complete lack of appreciation for the culture and ambience of this neighborhood. Should this request be approved, it will most likely be the beginning of more requests that will contribute to the detriment of not only this community, but others too. I live at 236 North Fletcher and I am not comfortable with having different people continually rotating through the neighborhood, with very little oversight. It is not what a residential community should be like. Once again, I hope this request is denied. I would appreciate it if you would acknowledge receipt of this letter and share with others on the Commission. You have my permission to read aloud in the meeting. Thank you for your time. Paul Blisard 417-766-5364 pblisard@uark.edu Page 406 of 425 CUP-2023-0009 332 N. FLETCHER AVE One Mile View NORTH J 0 0.13 0.25 0.5 Miles 01 W l Q l LLJ C9 � W UT t J J O U J CS m Z O I I N DG I_t RPZD �t Subject Property 1MF-6 - , iAF�TiTE,SI IN [all :I J B = I RSF-4 —JI, A 0 _wd I ii,. J L ► tir• NC: ��` ®V RSF-S �r / zoning � 1-z Ganaral maaamal iiiiiiii Neighborhood Link --- RESIDE NTIALSINGLE-FAMILY EXTRACTION iiiiiii= Regional Link - High Activity _ _ _ _ _- -- - -' Rsu COMMERCIAL Urban Center RI-12 g� NS-L ResltleniiaFOfice Gi — Unclassified _ �R«1aem1al-�aalWml �c-z I_ RSF-s Ica Alley — — — _ RSF-1 FORM BASED DISTRICTS _ _ RSF-2 Oownbwn Core — Residential Link ❑ RSFd RSF-] �uman>•nomagnrare g�Mein Sireat Cen[er Shared -Use Paved Trail I RSF-8 RSF-18 �Gsxniown General g�wmmanlry Services — — Trail (Proposed) Q RESIDENTIAL MULTI -FAMILY =RMF-8 Neigbbo.1 1 services g�NeigM1borM1ootl Conservation —__ Design Overlay District I _ _ _ _ _ _i M RMF-12 PLANNED ZONING DISTRICTS Fayetteville City Limits r — — — — I I Pla inning Area I--- �I— __! � RMF-18 RMF-2a g� Commercial, Intl slnal, Resltlentlal INSTITUTIONAL r Planning Area Fayetteville City Limits --_- g� RMF-0g INDUSTRIAL 1-1 Heary Comma 1.na Light Inds. —I Page 407 of 425 CUP-2023-0009 Close Up View UTTOWST DICKSON W Q LIJ J 0 RMF PRING-ST 332 N. FLETCHER AVE RSF-4 w/ a/ w/ v/ J / LL / DICKSON Neighborhood Link Alley Residential Link Hillside -Hilltop Overlay District r � ;Planning Area 0 75 150 Fayetteville City Limits C TD Subject Property Feet 300 1:2,400 450 600 RSF-4 RSF-8 RSF-18 RMF-6 RMF-24 P-1 Page 408 of 425 S a , —.— W yew AL Qy 2 H S,Fy''ne Dr M O U N S E Q U O A H CEN ER y NORTH 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook It doesn't look like this was sent to the other commissioners. Please share before Monday night's Planning Commission. Thanks! -- Mary From: emily ervin <Inkedgirll cox.net> Sent: Friday, February 24, 2023 5:08 PM To: Madden, Mary<mary.madden (cDfayetteville-ar.gov> Subject: fletcher ave townhomes CAUTION: This email originated from outside of the City of Fayetteville. Do not click links or open attachments unless you recognize the sender and know the content is safe. good afternoon— i've lived at 362 n. fletcher for 21 years, adjacent to the new townhomes being considered for short-term rentals. i watched the agenda meeting last night and wanted to confirm what you and Commissioner Garlock mentioned. you are correct in that these were touted and approved as "attainable" and "workforce" housing, both in writing, as well as in discussion during city meetings, during the initial rezone and the following CUP. additionally, i have written letters and spoken with the planning department a few times about this and other concerns. to be frank, I'm exhausted, defeated, and incredibly disappointed in the handling of this project and how we've been disregarded. not only was the applicant given preferential latitude (if that's a term) by city staff, but also was allowed to misrepresent water runoff issues to both theirs and the property seller's advantage. there were two cost shares with the city that benefited only the developer. we now have flooding issues due to the entirety of our adjacent property line being dug out (some parts several times over). i've held fayetteville to a higher standard in the 27 years it's been my home. the false housing narrative and public smearing by those who vote on our livelihood has been personally crushing. i appreciate your work and integrity in helping our city to grow responsibly. sure, change is hard, but i've always welcomed new folks to our community. we've got so much to offer. thanks so much, emily ervin as a correction, this property has had code violations in the past, however the addresses were previously 310 and 326 north fletcher. the parking lot in the back is very hard to maneuver and cars "bottom out" at the entrance, so there's already been increased parking along fletcher, along with beer cans and folks coming into our yard after midnight. the plans presented to the commission had a "low impact development island to protect parallel parking and calm traffic" but wasn't implemented. I'm attaching a timeline with links to city meetings and agendas related to this development, for reference. https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2YiliMWl1LWQ3YzUOZjQ1MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk7%'R� I-OfWZ5 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook CUP-2 21- 0 026... - Done • :irF • =1� ~ Ji' • 'li _fi • ai ■ Um � alp •:tom WW#IIWI� ++�1wM1�4 SIR 1 MiF https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2YiliMWl1LWQ3YzUOZjQ1MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk7%W�i .OfWZ5 2/28/23, 8:21 AM Mail - Harrison, Gretchen - Outlook UP- 1- 00 .., v Done 1 1 l Ion -I. - - 1 ' L y ]L:1� 0 F— — — — — — — — — a1 TP �V -- 4 m 1 m � Sent from my (Phone https://outlook.office.com/mail/AAMkADY3NjUwZjlwLTVmODAtNDk2Yil iMWl1 LWQ3YzUOZjQ1 MzEzNQAuAAAAAADmjRtrCgeFS6ahQgk7%W�b' Of 4Z5 CITY OF W41iFAYETTEVILLE ARKANSAS MEETING OF APRIL 18, 2023 CITY COUNCIL MEMO TO: Mayor Jordan and City Council THRU: Susan Norton, Chief of Staff FROM: Alison Jumper, Director of Parks, Natural Resources and Cultural Affairs DATE: SUBJECT: Walmart and AND1 Paint the court event at Walker Park RECOMMENDATION: 2023-651 A resolution to approve Walmart and AND1 to refurbish and paint Walker Park Basketball court, and to host a back to school backpack and shoe giveaway BACKGROUND: AND1 is a basketball footwear and clothing company specializing in basketball shoes, clothing and goods. Founded in 1993 as a graduate school project, the brand aimed to appeal to street ballers. Since then the company has grown to sponsor NBA players, numerous tournaments around the country. In 2020 AND1 began investing to refurbish basketball courts across the country. Each project included a community celebration with star performances and gear donations. DISCUSSION: AND1 is sold in Walmart Stores. This year marks the 30th anniversary of AND1's beginnings. As part of the celebration of the culture of the game, AND1 and Walmart are proposing to refurbish and paint the courts at Walker Park and provide a back to school shoe and backpack giveaway. Working with their team of artists, and a local artist, the event would include custom artwork tailored to Fayetteville, product and back to school supplies giveaway, and entertainment. The total investment in the court and the event is approximately $200,000. The exact design of the court will be finalized once the artists are engaged. Both Walmart and AND1 logos or marks are expected to be painted on the court. Donor recognition is allowed by the park donation policy and city council approval. This will be presented to the Parks and Recreation Advisory Board for approval on April 3rd. BUDGET/STAFF IMPACT: None ATTACHMENTS: 2023 AND1 Paint the Court SRF, Examples, Fayetteville, AR Code of Ordinances Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov Page 414 of 425 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 - Legislation Text File #: 2023-651 Walmart and AND1 Paint the court event at Walker Park A RESOLUTION TO APPROVE A PROPOSAL BY WALMART AND AND1 TO REFURBISH AND PAINT THE WALKER PARK BASKETBALL COURTS AND HOST A BACK TO SCHOOL BACKPACK AND SHOE GIVEAWAY, AND TO APPROVE THE RECOGNITION OF WALMART AND AND 1 FOR THEIR SIGNIFICANT CONTRIBUTIONS AT THE REFURBISHED COURTS WHEREAS, AND1 is a basketball footwear and clothing company founded in 1993 that sells basketball shoes, clothing and goods at Walmart Stores; and WHEREAS, in 2020 AND1 began a program to refurbish basketball courts across the country with each project including a community celebration with star performances and gear donations; and WHEREAS, to mark the 30th anniversary of AND1's beginnings, AND1 and Walmart are proposing to fund the refurbishment and painting of the courts at Walker Park and host a back to school shoe and backpack giveaway; and WHEREAS, working with their team of artists, and a local artist, the event would include custom artwork tailored to Fayetteville, product and back to school supplies giveaway, and entertainment. The total investment in the court and the event is approximately $200,000; and WHEREAS, § 97.088(B)(2) of the Fayetteville City Code provides that signs recognizing significant donors or contributors must meet certain conditions, including approval by the City Council if the proposed recognition does not explicitly conform to the Operations Policy for Donor Recognition Signs; and WHEREAS, on April 3, 2023, the Parks and Recreation Advisory Board recommended that the City Council approve a resolution authorizing the recognition of AND1 and Walmart on the refurbished basketball courts. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves the proposal by Walmart and AND1 to refurbish and paint the Walker Park Basketball Courts and sponsor a school backpack and shoe giveaway, and, pursuant to §97.088(B)(2) of the City Code, authorizes Mayor Jordan to approve the form in which AND1 and Walmart are recognized for their significant donation and contribution to our community at the refurbished basketball courts, which may include the incorporation Page 1 Page 415 of 425 Resolution: File Number: 2023-651 of the AND 1 and Walmart names and logos in the basketball court artwork. Page 2 Page 416 of 425 City of Fayetteville Staff Review Form 2023-651 Item ID 4/18/2023 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Alison Jumper 3/29/2023 PARKS & RECREATION (520) Submitted By Submitted Date Division / Department Action Recommendation: A resolution to approve Walmart and AND1 to resurface and paint the existing basketball courts and to host a back to school backpack and shoe giveaway at Walker Park. Budget Impact: N/A N/A Account Number N/A Project Number Budgeted Item? No Total Amended Budget Expenses (Actual+Encum) Available Budget Does item have a direct cost? No Item Cost Is a Budget Adjustment attached? No Budget Adjustment Remaining Budget Purchase Order Number: Change Order Number: Original Contract Number: Comments: Fund N/A Project Title Previous Ordinance or Resolution # Approval Date: V20221130 Page 417 of 425 AND1 Paint the Court Examples Cordelia Park Charlotte, NC DeFremery Park Oakland, CA Page 418 of 425 3/29/23, 2:11 PM 97.088 - Signs Prohibited Fayetteville, AR Code of Ordinances (A) No person in a park shall paste, glue, tack, or otherwise post any sign, placards, advertisement, or inscription whatsoever, nor shall any person erect or cause to be erected any sign whatsoever on any public lands or highways or roads adjacent to a park, except as set forth herein below. (B) Exceptions. (1) Athletic Field Signage. Signs shall be permitted on softball/baseball outfield fences and scoreboards at locations and in sizes designated by the Parks and Recreation Director. Uniform fees shall be charged dependent upon placement and size of the permitted signs. The content of the sign and whether it is commercial or non-commercial may not be considered. Designated spaces shall be sold at the established price on a first come basis. The owner of a sign at a designated location shall have first right to renew before others can purchase the size/location for a new or replacement sign. (2) Recognition Signs. Signs located in city parks or on city trails that are used for the purpose of memorializing a person or family through naming, recognition of significant donors, or recognition of contributions to the facility or amenity on which the sign is installed shall meet the following conditions: (a) Maximum Number of Recognition Signs. Most donor or honoree recognition signs shall be limited to one for the facility financed by the donor or memorializing the honoree. For a park or a major facility with more than one major entrance, a second recognition sign may be recommended by the Parks and Recreation Advisory Board and approved by the City Council. (b) Maximum Size of Recognition Signs. (i) Donor recognition signs in city parks shall be sized in accordance with Exhibit "A", Donor Recognition Signs, unless otherwise determined by City Council resolution. (ii) Trail Recognition Signs shall not exceed four square feet for trailhead facilities. Recognition signs along the trail for park benches, etc., shall not exceed 1.5 square feet and should be incorporated within or attached to the bench or amenity sponsored by the donor. (c) Design Requirements. All recognition signs must comply with the following requirements and shall adhere to the aesthetic values and design of the park or trail. (i) The recognition sign shall include only the name of the person memorialized or the name of the organization, person or business which has donated significant funds to the park facility. A company or organization logo (without company colors, any advertising or slogans) may be used on the sign. (ii) The design of the sign shall be incorporated into the park facility and shall be approved by the Director of Parks and Recreation who shall ensure the signs' high quality and durable construction and its consistency with other recognition signs within the park. (iii) Recognition signs shall comply with the Donor Operational Policy unless exempted by the City Council. (d) Facility Naming. The naming of facilities is permitted so long as the donor or honoree has made a significant contribution to the city, the facility or the Parks and Recreation Department in terms of financial donations, voluntarism or dedicated public service. Final naming of facility may be as recommended by the Parks and Recreation Advisory Board with final selection and approval by the City Council. Naming of the facilities should meet the Naming Park Facilities Policy attached as Exhibit "B", unless otherwise determined by City Council resolution. (e) Adopt -A -Park or trail groups may post a sign while they are actively working on a park project that provides information about their organization or group. The sign must be approved in advance by the Parks and Recreation staff. about:blank Page 419 of 4�5 3/29/23, 2:11 PM Fayetteville, AR Code of Ordinances Exhibit "A" Parks and Recreation Department SUBJECT: Policies and Procedures Manual OPERATIONS POLICY FOR DONOR RECOGNITION SIGNS CITY OF a e e��kle NUMBER REVISIONS: EFFECTIVE DATE: PAGE: t OF t 6-16-2015 A R K AS SUPERSEDES: APPROVED BY: DONOR RECOGNITION SIGNS PURPOSE The purpose of this directive is to provide policies which will govern the naming of park facilities currently owned or acquired by the City of Fayetteville. This policy statement takes precedence over any previous policies and guidelines which may have governed the naming of these facilities. POLICY In order to provide important capital facilities in Fayetteville Parks, it is pragmatic in a time of shrinking public dollars to seek outside funding. It is essential to have specific boundaries and criteria in establishing fair and proper recognition of significant facility donations. This policy sets guidelines for donations within parks as well as on trails. All sign and plaque designs must be incorporated into the design of the facility. Donor recognition signs shall adhere to the aesthetic values and design of the park. Donor recognition in parks is based upon the type of facility donated. Donor recognition on trails is limited on the trailheads unless there is an educational and/or art feature that is appropriate to be displayed along the trail. Recognition signs may not be predominant within the educational and/or art component. Recognition for each donation will be determined pursuant to the Recognition for Parks and Trails Facilities Policy. Any exceptions to this policy must be approved by City Council. Park Planners have the latitude to design signs recognizing donations based on site location and donor specific criteria. Naming of facilities donated must meet the Naming Park Facilities Operational Policy unless accepted under City Council resolution. The naming proposal will be presented to the Parks and Recreation Advisory Board for their recommendation to City Council. City Council has final approval of the park facility name, including the right to approve a different name. The option for naming facilities is only permitted under the Park Facility Diamond, Platinum, Gold and Silver categories. Minor items such as trash receptacles and flower beds cannot be named. Parks and Recreation SUBJECT. Department Policies and RECOGNITION FOR PARKS AND CITY OF Procedures Manual TRAILS FACILITIES POLICY MER REVISION EFFECTIVE E PAGE iIe DATE OF 3a A R KANAS 6_16_2015 SUPERSEDES APPROVED BY. RECOGNITION FOR PARKS AND TRAILS FACILITIES POLICY Bronze Category: Recognition on Donor Wall for 25 year period I Donation of $25,000 up to $250,000 for park amenities. Examples include: about:blank Page 420 ofWz5 3/29/23, 2:11 PM Fayetteville, AR Code of Ordinances Bleachers Batting Cages Bike Racks Lighting Drinking Fountain with Dog Bowl Prefabricated Pavilion Picnic Table and Grill Art Sculpture Single Playground Apparatu rocks/swing set) Landscape Feature Size of donor wall and names to be approved by the City Council. ilver Category: Naming Rights for 10 year period Donation of 75% cost of new facility over $250,000. Examples include: Soccer Field Baseball Field Tennis Court Basketball Court Disc Golf Course Concession Stand/Restroom Park Restroom One Mile Asphalt/Concrete Park Trail Small Amphitheater (seating for 150) Water Feature Parking Lot (25 cars) Greenhouse Playground Gold Category: Naming Rights for a Field/Court/Facility for 25 year period about:blank Page 421 ofWz5 3/29/23, 2:11 PM Fayetteville, AR Code of Ordinances Donation of 100% cost of new facility over $250,000. Examples include: Soccer Field Baseball Field Tennis Court Basketball Court Disc Golf Course Concession Stand/Restroom Park Restroom One Mile Asphalt/Concrete Park Trail Small Amphitheater (seating for 150) Water Feature Parking Lot (25 cars) Greenhouse Playground Dog Park Platinum Category: Naming Rights of a Complex for 30 year period Donation of $1 million up to $5 million to name a complete complex. Examples include: Sport Complex: 4-6 field lighted complex such as softball, baseball, soccer, tennis Diamond Category: Naming Rights of a Park Aquatic center Amphitheater- seating for 1,200 Development of a new park Donation over $5 million to name a park. about:blank Page 422 of W5 3/29/23, 2:11 PM Fayetteville, AR Code of Ordinances RECOGNITION FOR EXISTING PARK FACILITIES $200,000 per baseball or softball field for 10 years, or $350,000 for two fields $150,000 per soccer field for 10 years or $250,000 for two fields TRAIL FACILITIES Silver Category receives donor recognition of a press release, ribbon cutting ceremony, plaque constructed of high quality durable materials up to 1.5 sq ft. Trail Facilities donated in the Silver Category may only be located along trails for educational purposes or as an integral part of an art feature. Gold Category receives donor recognition of a press release, ribbon cutting ceremony, sign constructed of high quality durable materials up to 4 sq ft. Trail Facilities donated in the Gold Category may only be located at trailheads for a 25 year period and include the following: Parking Lot Pavilion City Process Restroom One Mile Asphalt/Concrete Trail 1. Parks and Recreation Staff or the Friends of Parks Board meets with donor to discuss donation including amount of donation, development of facility/amenity, recognition operational policy, naming rights (if applicable), sign appearance/style/construction, time requirements and other pertinent topics. Donor must meet the Operational Policy about:blank Page 423 of WZ5 3/29/23, 2:11 PM for Donor Recognition Signs. Fayetteville, AR Code of Ordinances 2. Request is presented for approval from Parks and Recreation Advisory Board. If the facility donated is granted the option to name the facility, the name must meet Park Naming Facility Operational Policy. 3. Request presented to Planning Office for approval. 4. Request presented to City Council for final park name selection and approval. 5. All donors will have first right to re -new their naming rights for an appropriate donation upon conclusion of the time period. 6. The city will reserve the right to remove a donor's name from the facility if the City Council determines by resolution that a donor would otherwise cause undue embarrassment or other issues for the City or its citizens. Exhibit "B" Parks and Recreation SUBJECT: CITY OF Department and Procedures Manual OPERATIONS POLICY FOR NAMING PARK FACILITIES le NUMBER REVISIONS EFFECTIVE PAGE aye e�i A R K A N S A S PRK OF 9 SUPERSEDES: APPROVED BY. NAMING PARK FACILITIES PURPOSE The purpose of this directive is to provide policies which will govern the naming of park facilities currently owned or acquired by the City of Fayetteville. This policy statement takes precedence over any previous policies and guidelines which may have governed the naming of these facilities. POLICY Upon acquisition of a new park, the Director of Parks and Recreation will assign a nondescript temporary working name or subdivision name for the park facility to be used until park development begins. Once park development begins, the Parks and Recreation Department will receive and forward park facility name suggestions to the Parks and Recreation Advisory Board for review. The Parks and Recreation Advisory Board will discuss and approve the recommendations at their monthly meeting. Once a recommended name has been selected, the Parks and Recreation staff will forward the name to the City Council for its final park name selection including a potentially different name. The following items should be considered when proposing names for any park facilities: • Geographic location of the facility • Outstanding features of the facility • Commonly recognized historical event, group, or individual • Individual or group who contributed significantly to the acquisition or development of a facility • Individual who provided an exceptional service in the interest of the park system For an individual to be considered, the recommended name must be accompanied by a biographical sketch which provides evidence of historical significance or contributions to the Parks and Recreation Department or City of Fayetteville. The naming of plaques, markers, and memorials within park facilities must follow the policies as stated above. Note: A name recommendation from the Active Transportation Committee for trail facilities will be required prior to forwarding to the Parks and Recreation Advisory Board. about:blank Page 424 ofW�5 3/29/23, 2:11 PM Fayetteville, AR Code of Ordinances (Code 1965, §17A-31; Ord. No. 3677, §2, 3-2-93; Code 1991, §97.088; Ord. No. 5335, 7-20-10; Ord. No. 5778, 6-16-15; >Ord. No. 5828 §1(Exh. A), 12-15-15) about:blank Page 425 of 475