TOWN OF MOUNT PLEASANT, SOUTH CAROLINA WATER SUPPLY COMMITTEE MONDAY, MARCH 31, Municipal Complex Building A - Public Meeting Room 1 12:30 P.M.

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1 TOWN OF MOUNT PLEASANT, SOUTH CAROLINA WATER SUPPLY COMMITTEE MONDAY, MARCH 31, 2014 Municipal Complex Building A - Public Meeting Room 1 12:30 P.M. MINUTES Members Present: Mark Smith, Chair; Ken Glasson, Paul Gawrych Staff: Eric DeMoura, Town Administrator Also Present: Clay Duffie, General Manager; Brian King, Budget & Procurement Officer; Mark Coffin, CFO; Mount Pleasant Waterworks Call to Order: Chairman Smith called the meeting to order at 12:30 p.m. 1. Approval of Minutes from the March 3, 2014 meeting Mr. Gawrych moved to approve the minutes; motion seconded by Mr. Glasson. Motion carried. 2. Mount Pleasant Waterworks a. Budget Brian King, Budget & Procurement Officer with Mount Pleasant Waterworks presented a PowerPoint presentation on the 2015 Operating Budget as follows:

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6 Page 6 of 9 Chairman Smith thanked Mr. King for his presentation. He announced that Mr. Mark Coffin had a presentation. b. Cost recovery policy changes Mr. Mark Coffin presented PowerPoint slides as follows:

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8 Page 8 of 9 Policy 9.6 Debt Service Coverage Action Trigger Whenever Test 1 is estimated to equal 1.50 or less, the Commission will take necessary corrective actions to ensure that the ratio remains at or above the mandatory level. These corrective actions may include increasing rates and charges, reducing operating expenses, deferring capital projects or retiring existing debt. Chairman Smith thanked Mr. Coffin for his presentation. c. Report on Commissioners retreat Chairman Smith recognized Rick Crosby in the audience. He asked him if he had any comments to make about the retreat. Mr. Crosby stated that he had been on the Water Commission for fifteen years and this was the best retreat they d had. He greatly appreciates Chairman Smith for being present and being active with the Water Commission. Chairman Smith recognized John Burn to speak from the audience.

9 Page 9 of 9 Mr. Burn asked if they were going to have any discussion about the basic facilities charges vs. volumetric rates. Mr. Duffie replied not at this meeting; they have committee meetings on Wednesday. Mr. Burn asked if he might spend a few minutes addressing the increases. He said that right now it is a volumetric rate increase the more you use the more you buy. He said he likens the basic facility charge to millage rates. It covers everyone so that everyone is paying for their impact to the system. The idea is that instead of having volumetric rate increases, just have a basic facility charge increase. As stated by Chairman Smith, we are at 14% and our neighboring municipalities are typically in the 30% range for the VFC charges which is more of an industry standard. It is a much more stable form of income because it is fixed. When there are these three-month rain events where the sales go down, it is very unpredictable so the income stream goes up and down. It is difficult to predict where they are going to be since with three wet months, sales go into the tank. He said the commissioners are looking to come up with a stable stream of income and that would be through a basic facility charge increase. That is what is being considered and he thought it was important for the committee to understand that thought process. Chairman Smith asked if there were any questions for Mr. Burn. There were none. Chairman Smith said that he echoed Mr. Crosby s comment that it was a wonderful retreat. Staff had done an excellent job with a very thorough presentation of the budget. He encouraged them to keep up the great work at Mount Pleasant Waterworks. 3. Adjourn The meeting was adjourned at 12:51 p.m. Submitted by: Patty Wallis

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