workshop. Heavenly Father, we come once again blessing. Thank you for all the blessings that you bestowed upon us. bless our father as we participate in this budget workshop. Help us to be good stewards oh God of resources you have given us and we so carefully give you the praise the glory and the honor and
that's in Jesus name. Amen. Amen. I pledge allegiance to the flag of the United States of America and to the stands one nation indivisible with liberty and justice for all.
All right. I'm just going to introduce Mr. Henry Thomas with Rath Tillis. We have um two agenda three agenda items that we're going to go over with you. Can't hear me? My um three agenda items that we're going
to go over with you. The first is going to be our water, wastewater, and reclaimed water um rate study results. then sanitation and then we'll go into the impact fees and then we'll talk about the storm water fees. Thank you, Blanch.
Um, mayor, commissioners Henry Thomas, senior vice president, RFAS Financial Consultants. Um, we've been, uh, looking at your enterprise funds for some time now and
gone through a number of iterations to refine things. Uh I know we've done uh previously done a workshop for example on the municipal impact fees with you. Uh there's been some changes to those fee proposals since that time. Uh you
know again we've talked about preliminary results uh in the past but today uh we'll give you an update of where we are before you have to adopt these fees. uh we have two of the three reports complete uh that we'll provide
you uh after this workshop uh assuming that you uh are comfortable with the direction we're headed. We don't want to make further changes. Uh and then the third report is uh we'll will follow uh shortly and but you'll have it before
you're asked to adopt these rates. So again with all the enterprise funds and in this case it's water wastewater reclaimed water is really a function of that water wastewater enterprise and then your sanitation operations are a
separate enterprise. Uh but the the the approach is the same and that is to balance the revenues in the fund with the revenue requirements including uh expenses uh capital uh including debt
funded capital uh any transfers to the general fund and those have to be funded through rate revenues impact fees and other miscellaneous fees. So one of the things that uh uh we're we're we're
looking at here is it's the the funds themselves are quite a bit different in the nature of the buckets that we have to address. For example, in water wastewater. you've got a significant
capital plan uh that's addressed through future borrowings and through the use of impact fees to help pay for the expansion related portions of the water wastewater and reclaimed water projects. Uh the sanitation utility when we go through it uh there the capital program
is mainly driven by the need to maintain your fleet. So it's not we don't have a lot of infrastructure projects, but we do have high operating expenses in in sanitation relative to total revenue requirements. So again, they're a little different and we're going to talk about
some of the underlying assumptions uh that we we used in coming up with the with the projected rate needs. So uh again uh we started with historical data, we started with budgetary data uh with respect to the capital improvement
program. We went through and looked at the nature of the projects. If it was a major project with a long lived asset, we we tended to uh look at that as being funded through some future debt. If it was an ongoing renewal and replacement
uh to maintain infrastructure and to make sure that you get the life expectancy out of it and that it's more of an ongoing expenditure, we funded those directly out of rate revenues. Obviously the expansion related projects
we focus the impact fees on them. Uh the in addition to the funding strategy we also have some established cash reserve targets and financial performance requirements. You're going to see that in the sanitation fund. Uh we're we
we're we've got a long way to go to be able to meet those target requirements. We're not trying to fix anything overnight, but that fund in particular has uh uh uh it's at the point where it's not sustainable at current rates
and we have to build cash reserves back up because we've been relying on those in the in the recent term. Um anyway, uh from here we'll tell you what we think the adequacy of rate revenues are and the rate plan that we would
recommend. Uh obviously uh I'm sorry obviously a lot goes into this and we we uh certainly want to uh get your input into the major assumptions but uh so basically we've used current cash reserves to try to phase in any
adjustments if possible. uh we've tried to achieve and maintain positive cash flows for the system so that as we go forward we're not uh continuing to rely on reserves uh the the targeted reserves is uh uh two twofold for water
wastewater we are trying to achieve 150 days of targeted cash reserves for the sanitation system which doesn't have as many contingencies in it we we're we the policy is 90 days uh that we're striving
for of of revenue as a as a a reserve. Uh also with respect to the debts on the water wastewater system, there's some uh there's some senior lean and subordinate lean coverages. Uh that as you know, debt service coverage is just the margin
above that revenues exceed operating expenses by that is available to pay for debt. We shoot for a target of 150 all in. That's what our uh bond councils and market tells us is a a good uh
uh target that reflects industry standard performance. That 150 means that for every dollar of debt, you've got a $150 available to pay that debt. However, the reason that target works is we also have transfers that don't get
counted in that equation and pay as you go funding. So there is a reason we achieve a target over debt uh of 150% because those monies get spent in other ways that u aren't part of the the debt
service coverage calculation if you will. That being said, uh some of the assumptions right now you're serving approximately 29,000 water accounts, 24,000 wastewater. You've got 10,800
reclaim accounts in fiscal year 2025. Uh the growth we have in here is over time it's averaging about 2.3%. But we really started out with some fairly significant growth in 2025
tapering down by 2029. In 2025 we are reflecting 6.7% growth. This is based upon uh the the activity that planning department is seeing currently and and reflects the near-term growth you're experiencing. uh combined system
revenues in your water wastewater service area. Combined system revenues at existing rates would grow from 33.7 million to 36.6 just because of that customer growth with no adjusted adjustments in rates.
Other revenues from miscellaneous charges, meter set fees, tap fees, interest income uh is approximately 1.6 million a year. uh and you've uh you're experiencing on average we're projecting impact free revenues of just under 10
million a year but that first year uh they're expected to be almost $20 million when you're experiencing that uh high growth uh in 2025. Um, so with respect to the cost and the
expenses that go into this, the current expenses are 24.7 million in the water wastewater fund. They're increasing to 33.9 million over the five years. That's an average increase of about 8.2% a year. Uh that's more than inflation
obviously, but the forecast does include over the five-year period eight new FTEEs to meet the needs of the growing system and the maintenance and operating requirements you'll be facing by 2029. That's almost that's just over $600,000
of additional expense for those eight new FTEEs. Uh otherwise, labor increasing at 5% a year, health insurance a little higher than that, 12, repairs at three and a half, chemicals at five. Uh these are fairly standard
factors that we we've used in in many uh jurisdictions recently. Uh the debt currently is about $5 million a year. uh general fund transfers are 3.3 million increasing overtime to 4.1
million by 2029. The capital improvement plan is $188 million. Uh 55.8 And eight of that is funded from impact fees 30% 101 million funded from debt funded projects 54% and
30.7 million in rate funded projects and existing impact fees are about 16% of the plan. Um, I I put a note in here for you that this plan originally was much higher and I'm sure the staff could
share with you. Uh, but they went through a lot of work to scrub that capital plan to make these rate adjustments as reasonable as possible. I'm sorry. Um, so there's new annual debt of 3.2
million starting in FY2026. that would increase your total debt to 8.1 million by 2027 uh to fund those capital projects that we've assumed to be funded from debt. And that debt instrument uh we've
assumed is an SRF loan type arrangement. So this chart just real quick shows you the components of the revenue requirements. The operating expenses are the red portion of the bar chart. They make up the bulk of the uh expenses. Uh the one that's growing, as you can see
here, this is the water system, and you've got that debt service coming on in 2027. That's for the expansion you're doing to the to the water plant. Uh you can see that capital funded from rates is also projected to need to increase
over time. So, uh the the black dash line on this chart shows where the revenues would be. And uh so without any rate increases, we'd still be able to fund operations and debt, but uh little above that uh over the course of the
5-year period. Uh similar picture for wastewater uh where over time we're not fully recovering our costs and and again you can see here that in 2027 there's also increases in that debt service component uh for wastewater. And then
the capital funded from rates takes a pretty good jump in 2029 uh because of projects that are out in that time frame that are cash funded. This is a similar pattern for reclaim. I won't there's no uh there's no transfers capital funded
from rates coming towards the reclaim system. They do get an allocated portion of operations and and debt service and transfers. So issues affecting rates. It's a significant capital improvement program. It's designed to not only expand the
system, but to upgrade it. Uh so there's benefits to both existing payers and future growth in this plan. The future increase in debt services due to additional funding for major capital improvement projects. U significant
increases in renewal and replacement. We've phased that in over the five-year period. And there's additional personnel and inflationary pressures that uh we've built into the forecast. Again, this is the result now in terms of percentage
impacts. You can see that it starts out with its front ended uh two fairly significant increases at 15 a.5% and then falling back to something more close to inflation. Uh the problem we had trying to spread this out further
was it resulted in diminished cash values that or cash uh balances that were hard to justify. So it's the way this funding is right now the project schedules uh most of this increase needs to be frontend loaded. Uh this just
shows on a combined basis if you do raise those rates how the the dash blue line the new revenues will satisfy your costs over time. Uh this just shows where we're at on operating reserves. This is with the
rate increases adopted and you can see that we've put on this chart uh the orange dash line is equivalent to 120 days. The green is 150, the light blue is 180 and you can see that we're exceeding the 150 uh target slightly by
the end. Uh again, all these funds stay in the fund and will get used for projects, but uh this is this is really the outcome we were trying to achieve with the operating reserves. Um this just shows I'm not going to go into all
the detail, but this just shows that even with the new debts, with these rate increases, you will be in compliance and you'll meet your coverage requirements. Uh this is the comparison of where you are today. Uh currently for 6,000 gallons of water wastewater, you're at
$71.38. Uh you can see that the uh the uh folks uh that your bill in 2026 would be 82.46. That's a little over a $10 increase. And
again, uh you can see that even though it moves you up in pos position, there's quite a number of systems right in the middle of that chart, uh that are comparable. When you're looking at your rate at 8246, keep in mind that the rates for all these other communities
are today's rates. Uh Winter Garden, for example, that's the rate they have in place for this year, but they have a rate path that would increase rates next year. uh similarly with Claremont uh St.
cloud um Okcoy. Um so, so my point to you is that I suspect that as your as you move up through this next several years, um so will uh your your fellow uh utility systems. Uh we recently did a
survey and I'll uh I did not remember to bring it with me uh but I'm going to share it with you and it's rate recent rate increases by some of our clients that you'll know very well and they're all quite a few of them are in the nine to 10% range every year for multi
multi-year periods. So it you know right now there is a lot of pressure on utility expenditures and rates unfortunately. So the based on that the observations and recommendations are that the current rates will be insufficient particularly
with respect to funding that uh capital plan uh due to increases in uh uh uh operating costs capital costs that are built into the CIP and the funding uh uh strategies that we have applied. uh the
rates would need to go up 15 and a half% and 26 and 27 followed by three and a half percent thereafter. So we're trying to phase back to that annual increase that's more inflationary based. Uh but we we need a couple of years to be able
to get there and uh keep the system viable financially. So that's water wastewater. Uh we we would recommend you adopt the proposed adjustment plan. uh we would conclude that it will maintain positive cash flow, that it'll meet
coverage requirements for any borrowing that we've assumed, and that operating reserves will build up and remain at targeted levels. So, that's what I have on on these uh enterprises. If you want to stop and ask me questions before we
go on to the impact fees, I'd be happy to do that. Okay. Any questions for Henry? I just had one question. I appreciate you being here and for this presentation. the you had made a reference in here to the the capital improvement plan, the CIP, and that there were adjustments made internally
from that plan to kind of make this work. Are we able to get a list of kind of the the original CIP plan and then what was taken out to We certainly have supporting documents for that. Okay. You know, most of that work was done at your with your engineering and finance
staff, right? And that was my understanding as well. So that's we can we can share with you. We we have the the original plan going back to the beginning was $400 million, right? Okay. So, we have those documents and you can see what's been taken out and
what's stayed in. Yeah. If we can get that just to understand that available to you, that would be very helpful. Thank you. And commissioner, I think when we did previous workshops when I shared all the the CIP capital stuff, it should have
been it was in included in that that original and I said which workshops last year 20 last year 425 last year when we were doing workshops last year but it should be in those documents but I'll make sure you get it
so it matches what we did last year. No, no, no. We we started this process last year, right? And so we started it with the 400 and some plan and that's when I told you we had to cut that back. That was that 40%. Mhm. That's why we had to come back and cut
back down. So that information was probably shared at some point, but I'll make sure you Was that cut back any additionally to this year or so? It's exactly what we did. It's the same projects that we budgeted for last year or it was the same plan that we was looking at correct
last year. So that didn't adjust at all. No, no, no. That's what we saying. We had to come back and adjust again because remember the rates were coming in at 40% 40% 40% like that. Yes. And so we made that adjustment and for that one year down to the 23.5. Right. If you look here, your first year
in this plan is 2025 at 23.75. So this is the same plan and now we just have cut some of those projects back to those rates. And I just want to know I just want to see that list again if I can just to refresh everybody's memory. I think that'd be helpful. Okay. Thank you. I I think actually you had about three
iterations to get where you wanted to be right. Yeah. Perfect. Thank you. Any other questions for Henry? Yeah. All right. All right. So sanitation. Uh this is a little different service territory than the than the water
wastewater uh because this is within the city limits. Uh you got currently 21,400 customers in 2024. Uh you've been experiencing customer growth of about 1.8% a year. So a little less growth
than the water wastewater system as a whole. uh combined system revenues without any rate increase based on that growth continuing would go from 7 6.8 to 7.3 million by 2029 uh just due to the
number of additional customers uh adding to the system. Uh other revenues are miscellaneous. Uh franchise fees and service charges uh very little. There is some fund balance and interest income in this fund but not
not not a lot. Revenue requirements. So your operating expenses are 7.1 million in 2025. uh based on the projections similar to what we used in water wastewater labor 5% health insurance 12 in this case we
fuel's important commodity we use 7% for fuel in 2026 5% thereafter uh tipping fees the tipping fees are what we pay to dispose of the waste with Orange County and your staff uh were they were they
received the county's projected rates for 20 for uh at 12% a year increase through 2028 and then 5% in 2029 uh and then yard waste bulk recycling at 5% a
year. So those were provided by the uh the county th those escalations um capital improvement plan over the five-year period you know relative to your operating expenses the whole plan for five years is 6.8 8 million and
that's that's basically vehicle replacement and expansion program uh uh that that you need when when you're adding vehicles. Uh it's fully funded from rates. This just demonstrates you can see here that as I indicated to you
earlier operating expenses really are the predominant cost in the solid waste system. So, it's those uh those folks that are out there uh you know collecting the waste on a daily basis and and the the fuel and and materials
and and repairs needed to make it make that happen. The capital portion, the vehicle portion is really a smaller portion of the overall revenue requirements. You can see because of the nature of the fleet uh and again we have these details but the fleet itself uh
the expenditures weren't necessarily equal every year because of the kind of trucks and the age of the trucks and when you were replacing them. So you can see those capital expenditures on this chart are a little I would say they're lumpy some years higher than others. Uh
but we're trying to fund it over time and not just chase the the need in a given year. So the issues affecting rates here are personnel costs, uh inflationary expenses and operating, tipping fees, that's a big one, especially with that 12% for the next
two years. And then uh uh the increased cost of new fleet uh that is certainly going up uh quite a bit since the last time you adjusted sanitation rates here. The uh we did something similar to this
in a few years back in water wastewater What we did here is we looked at the marketplace around us and a lot of our competitors um have commercial providers that provide those those uh waste collection
efforts in in in other communities. And so what we did is we looked at and as well as other municipal providers that provide commercial and we we kind of created an opportunity cost approach and said it doesn't make any sense to
increase rates to the residential class when the commercial class isn't paying a a marketbased rate. So you can see in the one year the commercial class gets a little bigger increase and then once we've taken care of that market adjustment they both increase at 6 and a
half% a year thereafter. Now, you know, the anecdotal entirely, my experience is oftent times your sanitation department is one of the departments within the city that people have the highest regard
for. And uh so if you're given a good high level of service, this is one where we've seen absolutely support for rate increases in other committees as opposed to options that reduce the level of service. Okay? like number of times you
pick the the trash up and things like that. So anyway, this is the the rate path for sanitation. Uh now we took that same uh comparative approach, marketbased approach and we looked at individual
services because in commercial it's it's a little nuanced. You have different dumpster sizes with different number of pickups. you have commercial carts and what we did basically your fouryard rate was well below everybody else's whereas
your commercial cart rate was closer. So we adjusted accordingly within the rate classes to again give you that nice competitive comparison with all your your neighbors. This just shows that with the rate
increases uh that we should be able to uh meet your revenue requirements, have some reserve built up uh in the fund. Uh again, at at uh at existing rates, we wouldn't be able to fund any new vehicles, and by 2027, you'd be f you
wouldn't be even funding your your labor and operating expenses. So this just shows you here the the problem we're having with this fund. I mentioned to you at the outset that this fund was struggling a little. So our goal is to achieve 90 days of rate
revenue as the balance. And you can see here particularly because of that uh extra vehicle expense we had in 2027. We we don't keep moving to our goal quite as as uh quickly as we'd like to. it dips back off a little bit, but then by
2029, we achieve the the target cash balance. This will give you flexibility going forward to make purchases of vehicles that you may that may be unanticipated, to make unanticipated repairs, to to uh to have flexibility in
timing of rate changes. Uh right now, again, you have very little options with the fund having essentially no cash in it at the moment. So this is the comparison. This is the current rates that others are charging.
Uh that uh uh is reflects current solid waste bills for residential. Uh the report when we give you the report will have some commercial comparisons as well. But uh here you can see that you're at 2313 going to 2660 and the
average of the other folks in this comparison which is heavily uh uh central Florida oriented is 2512. So again I'd say your rates are very competitive even with the comparative even with the rate increase.
So again for this one uh existing rates won't be sufficient. you won't be able to fund all your operating expenses or or any new vehicles if you don't have a a rate increase uh absent reducing staff and reducing costs. Uh due to those
increased operating expenses, we're recommending the 15% increase in 2026 followed by 6 and a half% a year till we get this thing in a in a sounder position financially. And then for the commercial class uh more a higher
increase overall for the first year again followed by six and a half percent thereafter. So um again we would recommend you adopt the proposed plan. Uh we would uh find that it will produce positive cash flow
and help you build your reserves back up to targeted levels. U and that's sanitation. So, if you have any questions on that, maybe we can do that before we go to impact fees. Any questions for Henry on sanitation? All right.
Okay. If you have commercial, you have residential. Yeah. Oh, here it is. Yes. So, residential, you're recommending 15%. Yes, ma'am. And you can see on Let me go back.
That would take the rate from 2313 to 2660 a month. Okay? So that's a $3 and 47 cent increase per month. And that would put you compared to your neighbors here that
that and again if you look you'll see we've got you know Winter Garden Mount Dora a lot of local utilities and the average that folks are paying out there to your uh to these other uh communities is about 2512.
So you'd be slightly higher than the average, but again like you were in water and wastewater, you can see that everybody's kind of uh accumulated around the center of that chart. So you don't see too many that are real high. Orange County, their
rates were approved and are significantly higher. But that that's their new rate. That's not That's a new rate. Yes, sir. Now, are all these new rates or these? No. No. Most of these are today's rate. Uh, but we did have the recently approved Orange County rates we could put in here.
We probably need to So, so we may we the problem is we may not know what Springs is. Well, I know that, but but it's not fair to Orange County. I mean, we ought to have that. Well, we could put Orange County back at what they're praying or puts their 26 rate,
but but again, I guess my view of this is that it really shows you that the cost of doing business is around $25 a month for these kind of systems for residential customers and everybody's really uh around that range. Um, you
know, you could look at levels of service and things, but if you're going to keep doing business the way you are today, then the rate needs to be at that 26. Before we leave that, Josh, can you tell me on on the cities that that are on this uh residential rate comparison? How many
of them are like us two two per week and how many of them are one per week? Can you because I mean that also is a a factor in the I believe that uh I know the city of Winter Garden is twice a week.
I think that might be the only one. Most of these most of these are once a week pickup Winter Garden. Okay. Yeah, the county's once a week. Some of these others outside of the u the county here, I'm not 100% sure on Yeah, they're mostly once a week
other than other than Winter Garden. Okay. Thank you. So on the reserve section of the we have no reserves in the 447 then right now. That's that's the way we're reading it. Yes, sir. Okay.
And if we weren't to do the increase, I mean it would we would never catch. We would never be able to fund reserves, new trucks. We would never catch up. Well, yeah. Yeah, if you didn't do the increase, uh if you look back on this chart on third, uh page 33,
what you'll see is that right away you couldn't fund any new vehicles or replacement vehicles and then by the third year you'd have to start reducing your operating expenses to make it work. Understood. Which was is mostly labor. So
I understand. Thank you. Excuse me, Mayor. Commissioner Anderson is on the way. Okay. Just to let you know. All right. Any other questions for Henry? Okay. All right. All right. So, let's go to
municipal impact fees. I'm earning my dinner tonight. This I can't see. Okay. So, we This one we did a little while back as well. And uh based upon that workshop we did, I know the the
staff of the various operating departments that use impact fees to pay for their uh uh expansion related capital needs. Dell went back and sharpened their pencil and took another look at things uh as it relates particularly to the public safety
facilities and also uh recreation facilities uh related to the swimming pool complex the aquatic complex. Uh that being said, uh some basics, you know, and you all
know this, but the fees are paid by new development uh based on the the nexus of a demand for an increase in municipal services caused by that development. And they're used to pay uh for capital facilities and in the case of police and
fire for major equipment such as firefighting uh vehicles, fire trucks, uh police cars u with with uh otherwise it has to be infrastructure
related. So, uh, so for example, new headquarters, uh, new new, uh, ball fields, uh, things that, uh, or possibly even more land for recreation could be a use of these funds. Uh, and again, the
the theory is to try to make sure that, uh, growth helps pay for its itself and that any fee we collect obviously reduces the burden of existing residents to fund these kinds of improvements.
Um the the basics of it also include both statutory requirements and case law. One of the most important things in the case law is the dual rational nexus tests. Impact fees are based on the capital cost requirements that are anticipated.
But then we need to spend those fees on the same projects that we use to develop the fees or to justify the fees. So that's the dual part of the nexus. uh impact fees should be based on reasonable level service standards that
can vary by community. So what's reasonable there is really uh in my opinion uh def as defined by the city of Apopkco. Impact fees cannot be used to fund deficiencies and capital needs or to pay for any operating expenses. So,
if you do not have enough vehicles for your current uh police uh department staff, you can't you can't uh replace or increase those vehicles. But if you uh are growing and and meeting the needs of
expansion, you can spend it on new vehicles and the fees are adopted by ordinance. U in addition to the uh this the case law, there's been impact fee history uh that started in 2006 with the Florida
Impact Fee Act uh section 16331. This has been a tough one to follow. You can see here on my last bullet on chart 44. It was amended in 2009, 2011, 2019, 2021,
2024, and most recently in 2025. and every time they amend it, they're making it more difficult for us to collect impact fees and get them implemented. Uh the Florida impact fee act, some of the
basics of it says that it requires the calculation to be based on most recent localized data. Uh so it can't just be comparing to your neighbors, for example. It should be your own capital programs and and and demographics that
drive it. Uh it provides that you have to account for and report the impact fee revenues and expenditures and separate funds. Uh you can add administrative charges to the fees but they have to be limited to an estimate of actual cost of
collecting them. Uh so that would be some admin fee time to collect it at time of permit. uh requires 90 days notice before imposing the fee. So if you were to adopt the fee on a given date, uh you could not start collecting
it for 90 days uh uh subsequent to that adoption. Annually, your finance director has to put together an affidavit that says you're in compliance with the act. Uh it used to be that the uh developers had
the burden of proof in any challenge of your impact fee policies. Uh not too long ago in one of the iterations of the impact fee act, they flipped the burden of proof to say the city government or the municipal government has the burden
of proof if you're challenged. Uh and you cannot issue any fees before the issuance of uh charge the fees before issuance of building permits. So, uh, we we take into account the the the the
statutes and the case law. Again, uh, I'm sorry, I'm hitting the wrong buttons here. Okay, so um, here's some of the new limitations. This is in the 2024 iteration.
The impact fee cannot increase any more than 25% of the current rate and it has to be implemented over two annual increments. If the calculation you develop exceeds 25%, it can only be increased 50% and you
have to take four years to do that. uh the impact fee increase may not exceed 50% of the current fee implies unless and the statute provides for a findings of extraordinary circumstance. It also says that you cannot increase the fees
more than once every four years. So when we talk about extraordinary circumstances, what we're saying is that you could implement a fee that goes beyond the 50% or do it faster than the phase in
limitations, but you have to have a finding the local jurisdiction by two publicly noticed workshops. you have to uh put on the record the the rationale for those findings and uh it has to be approved by a twothirds vote of the
governing body. Now, there are new extraordinary circumstance provisions that will be changing uh based on uh Senate Bill 1080, and they will go in effect in January. And they're going to say that you have to have a 100% vote uh
to to get extraordinary circumstances and that uh there's other limitations they place on your ability to uh impl implement feeds also. uh city attorney has highlighted the fact that um that
the statute really doesn't define what extraordinary circumstances really means. The car common arguments we make and see made by local governments are the demonstrated need for the for the projects. Uh it's you know it's tough
maybe to conclude some of these as essential needs uh like for example aquatic centers but uh again high population growth uh which you certainly are experiencing high inflation environment and the impacts to existing
taxpayers if you do not adopt the fees at full levels. So those are some of the findings you can make. Uh again, the requirements for that will change in January 2026. So, uh we probably want to think that
through in terms of implementation. I know uh Cliff is going to be talking to you more about his legal findings uh and how we can implement these fees properly. Excuse me, Mr. Tom. Um Holly is on her way. Correct.
Yeah. So the the feed calculation basis is to look at our demographic data existing investment uh we then uh uh allocate the facilities that are available to certain
new growth and then what we've done is we come up with a fee calculation and for residential it's based on a dwelling unit and for commercial it's based on a square foot based on the type of commercial uh property.
uh some of the assumptions again 2 and a half% growth uh 1% growth and through all the way through 2020 2050. The reason we project out to to close to buildout is some of your uh assets that
are in the plan like uh new new uh training facilities and things like that are expected to last you through buildout levels of service. So the existing investment you have out there in police is about 10.7 million. Uh you
have 2.26 officers per 10,000 population. Fire, you've got 19 million in investment. Uh you're 90% of the time you've got a 5 minute and 20 second or less response time. Parks that 24.7
million. That's the one I told you that I need to correct. That should be 22.3 uh because the 24.7 included some minor equipment that shouldn't have been in there. So I will share with you what that does
to the rate here in a minute. So the capital plan that goes into this and again it's not all allocated to new growth because the these facilities benefit existing and future population. The police total plan is 86.1 million.
We included 80 million of that. It includes the public safety complex, the police's portion at 54.5 million and a $25 million training facility. Fire, the total plan is 50.6 million. 41.8 of that
was included in the fees. Public safety complex, their share is 32.3 and a new station, seven at 6 million. parks plan. The total plan is 116.9 million. Only 26.1 million was included.
That includes land acquisition, a new soccer field, uh, and new tennis and pickle ball courts. Existing calculations versus the fee and the caps. So, this just shows you the current police fees. What the existing
fee is for Dwellia is 747. the new fee would go to uh 1262. Um let me make sure I've got the right uh and then the statutory cap uh is
1,120. So you couldn't go to the full if you do the phase in you can't without the extraordinary circumstances you couldn't go to the full 1262. Um again you can see that uh we under the existing approach we uh in the
categories that we have there's some shifting around of costs. Uh there's some that are going down slightly like institutional and others that are going up like retail significantly and this is based upon the latest trip generation
data the latest uh development uh information we have for your community. So this just shows you again uh now with respect to police impact fees uh I will tell you you're already at the high end
of these local communities and would go uh in this comparison to the highest fee from 747 to 1262. Uh but again that would fund those the growth related portions of those major facilities.
fire impact fees. The existing fee is $78. The full calculated fee would go to 1511. Uh the statutory cap is 1062. So we could not phase in the full 1511 without
extraordinary circumstances. You can see similar results on the non-residential portions where again uh some of them went down slightly uh but many of them went up. Uh and uh again that's an
attempt to use the latest and most recent data and calculate it as fairly as possible. Um again here same kind of story on uh fire impact fees. You're kind of leading the pack already. You're in the higher end and you would be among
the highest in Central Florida on impact fees for fire. But again, you're trying to fund a a significant investment in facilities that goes way beyond what you currently have invested in your police and fire uh services.
Uh again, parks and wreck. This is the one. Let me go to my my handout here because this is the one I need to ch tell you changed a little bit. Okay. Based upon that assumption, I told you that we included uh we included some
minor equipment in the in that $24 million number. The new fees adjusted calculated would be 1358. So it's slightly lower than the 1431 and the multifamily would be 1086. So again,
slightly lower than the 1144. Wait, 1086. 1086. Multif family per unit 1086 and single family 1358. I'm repeat that again. Single family instead of 1431 it would
be 1358. Okay. And and 1086 for multif family and 1086. Okay. Right. So So both of these fees are less than the 50% increase. So you could uh phase
into the statutory cap the 15% or to this number. Uh you you'd still have to do it over four years under the current uh statute without extraordinary circumstances. So this just shows you here now on the wreck portion um you are in the lower
part of the center of the uh comparison with other communities uh in terms of your current fee and you would move up slightly but uh again you you've you've had a pretty robust recreation facilities program and you've had good
fees in place for some time now so you're probably ahead of what some of these committees are trying to achieve. uh in terms of their recreation plans. So this is just when we combine the police, fire, and recreation
together, and it shows you where the average is is 2634. You're currently at 2515. These proposals would take you to 4204 if you adopted them at the fully calculated levels. again there you may
you may you may choose to do the phase ins and not do that. Um so again the fee ranges are depending on uh the type of fee uh between 35 and 113%. Residential fees are a lot more variable
because they're by specific property types. U the the estimate of impact fees generally surpass the standard statutory limit of 50%. Um, you know, we're going to want to talk some more, but you can implement these by uh by doing the the
the following the statute or we could talk about having an extraordinary circumstance hearing. Maybe not all of them qualify for that and I think again I'd like some more uh uh support from from city attorney on how we do that
properly. Uh, and then this is just some of the the things that Cliff has come across recently and it seems to imply that you may have your hands tied if there's been a hurricane that's made landfall uh
recently. Uh, he got the these things as summaries of the bills and we're going to be going through them, both of these bills with them uh to make sure we're all um on the same page on how they should be interpreted. Henry, I think this this the first bullet on this page.
I think it if fees have have been not not I think you need to scratch out not. No, no. If you haven't updated them, then that's not a good reason. That's not extraordinary circumstances. That's what they're saying. You should have been updating them. And because you
haven't, you don't get to catch up. Okay? That's what it says. I'm telling you, they're making it more and more difficult. The other thing they've done to us that is a little tricky with what we've been doing because this has taken some time is that new statute also says
that you have to complete the study within one year of starting it. So they're they're trying to make it hard for you to get these things done. Wow. So um you said we haven't been doing it on a regular basis. Well, you did you did about five years
ago. That was the last time we It's been a I I' I'd have to go back and look. I helped you with them a number of years ago, but but it has been it's probably been at least five years since we increased them. I'll look I'll get you that number. That's when it's it started. I don't
know if he increased the I thought we did it more recently than that for some reason. The water wastewater maybe, but I'm not sure about I still thought we hit impact fees to I'll go back and look at the dates. Some impact fees you did, but transportation they're kind of trying to say that if
you've been neglecting it and now all of a sudden you needed It's too bad. And to me, what does that I'm I'm Well, it's not saying that you can't do it. It's just saying you can't use extraordinary circumstances provisions. So, we can still increase them, but you can't go you can't increase it to the level that
necessary. Yeah. So, so take take Mount Dora for example. They are facing all this growth pressure. They're building a new wastewater plant. They're trying to pay for it. They implemented the fee use extraordinary circumstances. But under this provision, they might have been
told, "No, you can't do that." Then the existing citizens are going to have to pay for that plan expansion because there's not going to be enough impact fee revenue coming in to pay their fair share. So, we really need to get this stuff right uh as it relates to
all your your funds and and uh that's why we're going to work with Cliff and come up with a plan that we think you can defend. Is your recommendation I would assume to to head the extraordinary circumstance route or at least explore that and see if
you're saying if if attorney Shepard feels that come back later we're going to have we're gonna share with you some alternatives on how you make that decision. Okay. But we're going to give you the background the legal background you need
to make the right decision. Okay. Understood. Thank you. So again, um they they they have again they've got a good lobby uh because to me this is the voice that's not being heard is the rate the the the
current citizens. Yeah. in these kinds of things. And the the article that Cliff shared would be the very top headline on it and it was from the Planners Association is these bills are very bad for our communities because it's going to make it harder to
get development to pay its fair share. So these are just the uh the various fees. Uh we went through these already. I'm gonna I'm on the wrong one here. Says parks and wreck. We just talked about that. We talked about the combined
fees. We talked about those bills. So, we're looking for Cliff to help us more on so again how we can deal with extraordinary circumstances and given that the the one doesn't change till January. I think
there may be a chance for us to to do it under a little less restrictive uh uh approach and then uh we'll come back to you uh to get direction on how to proceed and fee levels you want to adopt.
So any other questions for Henry on the impact fee section? So so what Henry what does your timeline look like? So we we would come back the next next council meeting or a couple council meetings and then
so you want the water wastewater uh and I think uh I think Lanch is going to talk to you about storm water the water wastewater sanitation we all want we want to adopt that with your October budget right okay yes
so whatever hearing you want to adopt those rates I'll just we do we do that in in September, Henry. But we'll do it right with the September. Yeah. But what I got to get a consensus on today is if we want to proceed
because I have to get the notices out by August 1st. Proceed with what? With the rate increase. So, so, so, so let's be clear. We've got a couple things going on here. Water wastewater reclaim. You need to put a
notice in the bill 30 days before that hearing where you adopt it, but you need to just tell them the time. You don't have to give them all the information. On the other hand, Blanch is going to talk to you about storm water. And that one you have to give them a notice and
tell them what the what they were paying, what they're going to be paying, and that has to go out ahead of that hearing to adopt those. And that has to be to the tax assessor's office. The role has to be done by September 15th. We've got the role done. Lanch is going
to ask you for permission to do the and again we're are noticing what the what the proposed rate is. Not you're not held to this. It's sort of like a a roll back rate on on taxes. This is the maximum you can charge.
So storm water she has to provide the resident what they were paying. Okay. our normal notice according to our ordinance, right? What we have to do is what I when I sent out that letter, right, that I sent out on August 1st that
includes um the planned or proposed rate increase for water and wastewater and sanitation. The storm water rate increase notice goes through the trim process just like our millillage goes through the trim. Don't we need an official meeting for
that then? Yeah, we we're going to talk about storm order now, but these are all presented as presentations, right? But I'm trying to get a consent. Not I come back in September. All of these things come back in September with action items because those notices is
also telling them when the hearings are going to take place. Right. So the trim notice one though what you need to get it out that's gone ahead of the 30 days. And what commissioner's asking is Uh, is that
can we do that without their approval? It goes out. It goes out in August. The trim stuff goes out, but we have a deadline with the property appraisals office that comes prior to them. But that has to be by September. When do they give them the trim notice?
I have to have that to them by August 1. And that goes out in August. Henry, Henry, Henry, stand up. I have to give that to them by August 1st, too. But if the same thing with the storm water, they go out in August, right? But we have deadlines for both of them. I think we're all on the same page of
the timelines. My question is these are presented as presentations. We have to You're asking for an official action, correct? No. No, not necessarily. You So you're not asking for any action? I'm trying to get a consensus if you want me to proceed with that or not. That is an action.
Well, that's what we talked about doing. And I don't I normally don't come I do it through the um budget workshops, right? That's why I gained that consensus normal where we do that. So we're in a workshop. No, this is a workshop. This is a budget workshop
where again no action items and this is how we normally do it. So when would you be take action to get to put it on the trend notice for August 1? That's what I'm trying to do now. So you're trying to get a consensus to do that? Yes. And that's how we've always done
it. That's what I'm trying to do now. This is how we've always done it. You know, we've and then we had additional workshops after I sent out the notices last year, remember? And then I had to send out additional notices upon your request because of, you know, the response. But this is the normal
process, but this is presented as a presentation and you're asking action item. I've shared with you throughout the budget workshop that the increases that we had reflected And I shared with you that we had the 15.5
for water and wastewater, 15% for sanitation, 20% for storm water. Yeah, but those just for the residential, we didn't go into commercial side of things either. So we didn't have all this information. So although you did present those high level numbers, we didn't have all this
information until yesterday. So I I just don't know how are we making a action tonight when these are presentations and it's a workshop and workshops are specifically not to have an action. Same process that we've done before. I got a just because we've done it doesn't mean
it's right. Yeah. Got this is how we've done it in the past. I got a consensus last year from the workshop and I was able to proceed because that's what remember the workshops went through to cut it from the 40% down to the 23.75%. Those were
done do through the workshops. I do remember all of that. But we did this in different order last year. We didn't do this workshop well after budget. Last year it was all built in together so that we understood what we were talking about as a totality of the
budget. We did several workshops in the month of July. This is and that's this is again after the normal budget workshops. We did other workshops talking about the rate increase in I remember doing a lot of workshops. I I don't need to be reminded on those. I
remember that. Yeah, this is this is one of those. All right, let's move on to storm water then. Good. Any other questions in regards to the other ones from Mr. Thomas? Thank you.
So, I'm going to need your help with this. This was prepared by you as well. But again, we're proposing a 20% increase in storm water as well. uh Rafillis um did provide this chart of comparison. So, okay. So, again, percentages can be a
little misleading because we're talking about the the it's an annual assessment, but for comparison purposes, we've broken it down here to monthly costs. And that monthly cost would go from 475 to 570.
So, that's your your increase. uh and the existing average out there is 960. Now, I would tell you this, this rate is sufficient to fund your budget that's been put together for storm water, but
it's these rates are going to have to go up more in the future. As you can see here, uh the cost of providing storm water services certainly if you take this as any kind of reference point, it's not in
the four to$6 range anymore. It's in the nine to to $12 range. So, we're working on that and we've increased the storm water rates in recent years. I mean, we started out, I believe, at $3. So, we're trying to work it up slowly. It is an
assessment so it will go on the tax bill as an annual fee. So do we have a like a three to five year similar plan to what we have in in wastewater water? Do we have something like that built out to where we can see
so a number of years ago we did some preliminary numbers and then that sort of just we don't have an updated plan for that right now. Okay. I would tell you you need to you need to work on that because you'd ultimately like to know where that rate
needs to land. Correct. But I think you know any effort to kind of try to increase it without putting too much burden on people is smart right now. Uh again percentages sound big but you know a dollar less than uh a dollar
a year or a month less than $12 a year is pretty reasonable. Uh but you will be asked to do more when we revisit it. Part of the issue here is we needed to get raise enough funds to be able to do assessments to know what we need to
spend the money on. Wow. So that was early in the plan was a lot of planning activities for storm water. Sure. Okay. And so this is just specifically to this year's budget. Yes, sir. Okay. And so next year is there limits
similar limits to how much we can increase that o year-over-year? No. Okay. No. So if there's new projects that come up next year or new uh needs that come up next year, we can increase this as needed to justify and accommodate our needs. Yes. And when we have a when you have a
plan that you feel comfortable with that's a multi-year plan, there's ways you can adopt that within the within the stat within the statute on the uh nylum assessment that will allow you to do it once and yet it over a period of time.
Okay. And that would be something to come back and do a hearing every year. Exactly. And we'd be able to tell the residents, hey, this is exactly what's happening in over the next three to five, whatever the year range is. I think that'd be helpful. Always understanding kind of the runway where we're going is definitely helpful. Um especially when it it deals with their money. So um thank you for that.
Appreciate it. Thank you. So in just in regards to following the ordinance, we have to you know send out the notices and then you do the public hearing. That's where the action takes place. So the standard process or the
process that has been followed is discussed during the budget workshops which is what we're doing now and that's what I'm seeking. So, we're looking for consensus on the rates for that are reflected in the 2026 budget. And that's just the utility rate, not
the impact rate. Correct. Just the the utility rates, the water wastewater reclaimed water rate, sanitation rate, and the storm water rate. Right. Okay. So, we're looking and I I apologize. I I Commissioner Anderson that know you had a flat tire.
I was still able to watch on YouTube. Oh, good. Excellent. Thank you. So, any questions for Blanch or we good to move ahead with the rates that have been presented here today? They're all in the 15%.
Yes, ma'am. I mean, this like this isn't a vote. So, that's what's been advised that that's what needs to happen and it is in line with the budget. Correct. So, again, that's non action. I know. I'm just trying to get in
because you you have that opportunity once the notices go out, you know. Okay. I just want to know if I can proceed with the notice. And and what was that increase for storm for I mean for wastewater? It's 15.5. Yeah. I mean dollar amount
per res 60 to 80. And Henry, will you be able to update the charts um as the other rate other cities come in and county?
Yeah. Uh yeah, I mean I it that would take some effort. We'd have to go back through that whole survey and determine if they've increased rates or not and update it. But we can certainly try to do that before you adopt the rates.
Yes. So that so we're it'll be September the 5th. Is that right? Yes. So September 3rd 3rd, I'm sorry. September September. So yeah, if we could I mean see what we can do update as much as possible. The
it's just really hard to keep them really up to date when we don't know everything that's going on out there. Correct. I mean it's a lot of research that again we will do that we'll make sure
yeah I mean Okcoi Winter Garden Orange County Winter Park Alamont Springs that would be maybe so this is the water wastewater bill increase the total at 6,000 gallons
which is your average consumption And that's an $118 a month increase from 7138 to 82.46. Was it 71? What now? Oh, yeah. Excuse me. What was that? 71. What you say? It was
It's a $118 per month increase. We're going from 7138 to 8246. That's for 6,000 gallons water and waste water. Any more questions, Commissioner?
Uh when I do this, when I try to expand it to look at it, it jumps all over the place. The Yeah, the 7138. If you look on the screen, you'll see it because I have the sheet. I've got it's got it or
I know that it's kind of one of the changes that they made. Okay. So, look on the screen. Yeah. I think these showed the Orange County rate instead of the city of Okay. Okay.
All right. Um just looking for some direction. Yes. Just consensus to proceed with the notices. That's it. So I think Commissioner Nester is in support of that. Um
I'm good. Thank you, sir. Um, mayor. Good. Commission, that's what you recommending. Yes, Commissioner Anderson. Yes. Thank you very much. Okay. All right. Any follow questions? Any comments?
In the meantime, we'll also get you some reports. Yeah. In addition to this briefing. Yeah. Quite a few tables documents. No, that'd be very valuable. Thank you. We'll we'll get you everything that went into the previous iterations of the model. Okay.
Thank you. And and when will we be able to come back and address the impact increase? Um when will you be available? Oh, I know you're out next week. Um everyone's available last week of this month. I am not.
Okay. Why don't we add it to the just do Yeah. Is that first meeting? Yeah. Do add it to the first meeting in August. Okay. Yeah. Yeah. Okay. Fine. Because then I guess we do need to know when the last time we did increase them as well because that will some of the historic dictate a lot of uh what we're allowed
to do. Okay. We're allowed to move forward. We'll do that. Seemed like it's been like six or seven years. That's when it was implemented. But when what was it increased after that? Never. Since when? What year was that? 2016.
2016. No, I do remember that. That I do remember. That was the last time we did. Wow. That was the first and last time. Uh, no, we've done we've done transportation. We did increase and water and wastewater. We did increase. Okay.
And that's what I'm thinking of. Yeah, we did increase those. Henry, if you Henry. Yeah. Come on. I mean, you were able to accomplish a lot with the for particularly the wreck increase because back when we put that
in place, the costs were a lot lower to do things. But yeah, that's the last time, if I recall right, it was 2016. So, and we did we you didn't even have police and fire and your wreck was a couple hundred dollars. Yeah.
At that time, I do remember that. That I do remember. Um because I was surprised that we we never had the city didn't have impact fees for police or fire. So that you said that was the first and
the last time that we did uh the impact fees for police and fire and wreck. Yes, ma'am. So, one of the the again the the uh u the the things that you're looking at in
the current fees is all these capital costs for new facilities are much higher than they were in 2016. Okay. But but again, in addition to just the cost increases, you're taking on
some new facilities that are u significant for both the police and fire systems. And and when was the last time we did for um sanitation? So sanitation rates I don't know when the every year
last year, but you don't we don't have impact fees for sanitation. We did we did an increase last year with 10% last year. Yeah. Sanitation again is mostly operating costs. So there's not a lot of capital to be recovered through an impact fee.
If we could maybe have that for the the next meeting historical historical on all the Yeah. rates that I appreciate. I sure will welcome that. No problem. just to have an idea because now with the legislator kind of putting a lot of restrictions on the
local munic municipalities um you kind of have to work around that now like Mr. that Henry said, no catching up. You can't. No, none of this municipalities can play catchup. Uh with the and quite frankly, the way
they've got it written, if you phase it in, you can only if the the analysis says your cost is doubled. You can't double the rate. You can only go up 50%. You can It takes four years to do it. And then you got to do the study again.
And if you're still capped at 50%, you'll never get to cost because if the costs rise and you keep doing the studies, you'll never be able to get to 100%. So, it's a big win for developers that that statute. It really is.
Well, we appreciate your time. Thank you so much for putting in the time for this and taking the time to present to us. Thank you. All right. Thank you. Appreciate it. Goodbye. Thanks, Henry. Thanks, Bl. Appreciate it. All right. Thank you everybody for coming out.