Sunday, September 20, 2020

Letter to the Editor: Response to Rios’ White Paper

 

 

Councilman Rios’ white paper presented at the August 15, 2016 City Council meeting recommended approval of a $6 million assessment to be levied just to the customers of Marco Island Utilities (MIU) at Marco Shores along Mainsail Drive and Isles of Capri to build two pipelines. As explained herein, if and when the pipelines are ever needed, the $6 million dollar assessment represents an action that results in the Marco Shores and Isle of Capri customers paying the $6 million twice.

Councilman Rios stated that if the $6 million dollar assessment is not approved, customers on Marco Island would have to pay about $333 for each residential unit (about 18,000 residential units). Councilman Rios is ignoring the revenues from impact fees previously paid to the City by Marco Shores and Isles of Capri customers, plus impact fees from future developments, and potential revenue generated from the sale of the sites of the former water and wastewater treatment plants on Mainsail Drive. These revenue sources should provide most, if not all, of the $6 million to build the pipelines.

Also, potential grant funding may be available to pay for a significant portion of the cost of the pipelines, if not all the funds, to build the pipelines.

One pipeline (at a cost of $2 million) is to transport potable water from the North Water Plant on Marco Island to MIU’s customers at Marco Shores. Currently MIU purchases about 70 million gallons per year from Collier County (at a cost of about $3.85/1000 gallons) for resale to its Marco Shores customers (with about a 50% markup). Since the incremental cost of water production on Marco Island is about $0.95/1000 gallons, not having to buy the 70 million gallons per year would give MIU an additional $200,000 per year profit.

The second pipeline, at a cost of $4 million, would transfer wastewater from Marco Shores and Isles of Capri customers to the wastewater treatment plant on Marco Island. This would allow MIU to shut down the Marco Shores Wastewater Treatment Plant (MSWWTP) on Mainsail Drive and reduce its labor and operating costs.

Marco Island Customers Not Marco Shores Customers are the Primary Beneficiaries of the Potable Water Pipeline

Florida State law requires that an assessment for a service area must provide a benefit to that area. The potable water pipeline provides every customer on Marco Island with a backup supply from the very reliable Collier County Water Treatment Plant located 10 miles from the coast. Marco Shores customers are already supplied by that Collier County plant and would be backed up from the Marco Island plants. Based just on the location of the plants, the Marco Island customers are the primary beneficiaries of the pipeline since they get a more reliable backup than the Marco Shores customers. Clearly, State law would require that Marco Island customers along with Marco

Shores customers pay the cost of the water pipeline that might not be covered by other revenue sources (about $0 to $50 per residential unit).

 

Conclusion

MIU customers at Marco Shores and Isles of Capri have paid a greater percentage of the total revenue than the percentage of services they consume, and the impact fees and revenue from assets at Marco Shores should provide all of the funding needed for the pipelines. Marco Island customers should not expect to pay for these pipelines even though they would get the primary benefit of the potable water pipeline.

Dr. Bruce Weinstein

Former Senior Project Engineer for the City of Marco Island and Marco Island resident

 

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