Minden moving forward with automated meters

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The Minden City Council will decide at its January meeting how to pay for the automated meter infrastructure that will replace the city’s aging water infrastructure.

In a workshop Thursday, council members discussed the different options they will have to fund the project, and in January, they will formally choose the company to conduct the installation.

The council reviewed a spreadsheet of figures showing the projected savings over a 20-year period, and Davis says they erred on the conservative side. He says they expect the savings to be more but are being cautious in their figures.

“Our figures are extremely conservative,” Mayor Tommy Davis said. “We tried to do the very best we can on the very lowest we can.”

Figures show the city could possibly save $75,000 in operation and maintenance costs in the first year following the implementation of the new automated meters. That savings comes from the elimination of two positions, Davis says, adding the two men in those positions would be moved to vacant positions in other departments.

In the first year, the city expects a roughly $278,000 increase in revenue on billable usage, according to the financial analysis. The total savings the first year would be in the neighborhood of $383,000. It will take about five years to break even, he said, and nine years to recoup all of their costs. After that, increased revenue is expected to be about $5 million.

The council will decide on whether to use Aqua Metric, the company that turned in the lowest bid of $2,640,813, with approximately $350,000 set aside for contingencies, for a total estimated cost of $3 million.

There are three options the council will consider to pay for it.

The first proposal, City Clerk Michael Fluhr says, is nothing in the budget and nothing pulled from reserves would leave the city financing the full $3 million. In proposal two, he explained, if the $3 million is financed, he would put $350,000 into the budget for contingencies, leaving a total to pay back $2.65 million. In proposal three, $350,000 would come from the public works fund and $1 million from reserves, leaving $1.65 million.
As of Thursday, there is $7.7 million in unrestricted funds in reserves, with $4 million in restricted and about $4.5 million somewhat restricted, meaning the money could be used if its use falls into certain categories. A total of $16 million is in reserves.

Payment for the AMI could be done one of two ways, through a purchase/lease agreement through Government Capital or through the Louisiana State Bond Commission. Davis is recommending the purchase/lease agreement with interest set at 3.26 percent. Fluhr says that rate could change by the time they decide their course of action, but it wouldn’t be by much.

Payments for the system would be about $356,000 per year for 10 years if it is financed, according to the city’s figures.

Council members also discussed concerns constituents brought to them, the main one whether residents’ yards will be torn up during the installation process.

Davis says in most cases, the existing water meters will be unscrewed and the new ones will be screwed in. For those meters that are encased in concrete above ground, Davis says the concrete will be broken apart and redone once the new meter is installed. If it so happens that a water meter must be dug up to be replaced, the city will redo the dirt work around the meter, replacing the soil – not necessarily the grass, but the topsoil.

The entire project will take about a year. It will take about four months for installation of the system, including radios and software. The installation of the meters will take up the remaining time. Customers will continue to be billed in the current fashion until the entire system is installed, Davis said.

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