A Citizen's Group Doubts Lehigh Acres' Utility can Cope With Growth

November 30, 2005

By Mike Walcher

Lehigh Acres, Fl. -

The utitity in Lehigh Acres will obtain 25-million dollars in bonds in the next couple of weeks to expand its water and waste-water treatment facilities.

Despite that, a citizen's 'watchdog' group claims the utility won't have the capacity to serve future customers in the fast-growing community. And the group charges that Florida Governmental Utility Authority dumped treated waste-water, effluent, into a canal on more than 40 days last summer.

"I dislike what they are doing to Lehigh Acres," said Robert Anderson, who operates a web-page devoted to tracking the actions of the FGUA, mostly with a very critical eye. "I was shocked by the effluent overflows last summer, and horrified that they didn't tell anyone about it."

In fact, the FGUA has admitted to the state Dept. of Environmental Protection that effluent over-flowed from a pond on 44 days last summer. The water ran into a canal, or into the low grounds surrounding the pond. Many of the overflows occured on days of record rains, and the DEP says much of that overfow probably was rain-water, rather than just effluent.

"There is no impact on public health," said Jon Iglehart, district director of the DEP. "The releases were negligle, but still it should not have happened. In the big picture, neglible, but still we may levy some minor fines against them --perhaps one-thousand dollars a day, for the 44 days." The DEP has the authority to levy fines up to 10-thousand dollars a day.

The utility is rapidly trying to expand its facilities to cope with more customers. But Lehigh resident Jim Fleming, whko's also the head of the East Cty. Water Control District, doubts that the FGUA can keep up with growth. "This is too little, too late. I can see a case where developers sue them becuase the new houses cannot get hooked up to water and sewer. And I suspect that existing customers may run into low water pressure, because the FGUA does not have the capacity to serve everyone."

The FGUA denies that, and says it is aggressively expanding its plants and finding other ways to dispose of waste-water. The FGUA took over an antiquated system a little more than 2 years ago, and is trying to expand with bond issues and new construction.

"I give them high marks for moving ahead quickly," Igehart told WINK News. "I think they are good stewards, and are making the best of the existing system that they acquired."

Lee County officials have talked at times about taking over the Lehigh utility, but no decisions have been made on that.

Watchdog Survey on the FGUA

On November 21st -23rd
The Lehigh Acres Watchdog did a survey
on what Lehigh Acres citizens think about FGUA

Results --- comments from the people ----

"They are just trying to make money by robbing the citizens of Lehigh Acres and could cause
the poorer to lose their homes. There is no reason to make us sign up for water and sewer when we all ready have them from our wells and septic tanks which we have paid for and work well."

"the bottomline, at the insistence of the GSG, the FGUA is going to install water and sewer lines without proof of need"

"Poor quality water (yellow) very good customer service, local Lehigh office"

"FGUA's rates are too high, GSG is untrustworthy and have no credibility dealing with public interest."

"It is looking like FGUA is a bunch of bunch of crooks. They could not make money as Florida Cities Water Utilities, some how they got this quasi government status as a "lark" to sell their systems off to other municipalities as a pretence. They have made money by raising rates and avoiding taxes because of their status. I wonder if they are not "in league" with some developers who need utilities in areas they want to develop so they force utility improvements and expansion on the citizens and they (the developers) don't have to pay for it....."

"It is too early to give an opinion on FGUA. I like what I have heard, but performance will be the way to judge them."

FGUA

Recently the Citizens of Lehigh Acres have heard negative things about Florida Governmental Utility Authority (FGUA) – Believe me things are about to get much worse –---

In a recent press release FGUA finally admitted the following –“On the water side, consumptive demand exceeded permitted treatment capacity in 2005.” and “On the wastewater side, the authority initially believed wastewater treatment capacity was sufficient through 2008. But growth has outpaced projections and in fiscal (year) 2005 the wastewater treatment plant exceeded its permitted flow capacity.”

When the FGUA was questioned about capacity earlier this year at a public board meeting they refused to comment on capacity and stated NO conveyance agreements on capacity where issued – but we know now that this was a smoke screen – FGUA has issued up to five different letters conveying they have capacity to developers – so who is blowing the smoke screen – FGUA telling the developers they have capacity or the FGUA on this press release stating they have exceeded permitted treatment capacity in 2005 to their investors. (The press release that I’m quoting from is from the Fitch Rating www.fitchratings.com a rating company that rates bonds.)

Fitch Rating assigned an 'A-' rating to Florida Governmental Utility Authority (FGUA) (Lehigh Utility System), FL's approximately $25 million utility revenue bonds, series 2005, and affirms the 'A-' rating on approximately $42.3 million outstanding debt. The series 2005 bonds are scheduled to sell on Dec. 5 via negotiation to Banc of America Securities LLC and UBS Financial Services, Inc. (Note: Bonds rated B or below are not investment grade -- in other words, institutions that invest other people's money may not buy them under most state laws.)

On the other hand, if growth has outpaced projections as stated above – then why is our Lee County Commissioners John E Albion (www.johnealbion.com) & Chairwoman Tammy Hall (www.tammyhall.org) allowing developers in Lehigh Acres to speed up growth and putting in over 7500 new homes in the next 5 years without increasing the needed infrastructure such as roads, schools, sidewalks, officers and etc. Why are the Commissioners destroying the lands needed for commercial development and turning the lands into residential planned developments – does Lehigh Acres need any more single family housing?? How about affordable family housing? How about commercial nodes throughout Lehigh Acres?

If FGUA needs money to pay for water and wastewater lines to all of the new 7500 homes in residential planned developments when why not increase impact fees to cover growth – since growth needs to pay for growth and stop harming the current rate payers with high water and sewer bills.

The Lehigh Acres Watchdog did a email survey on Nov 21st – 23rd about FGUA and received a better than average return – you now can see the results of the survey at www.lehighacreswatchdog.com

Sincerely,

Robert J Anderson
President
Lehigh Acres Watchdog, Inc

FGUA recieves A- Bond rating

Fitch Rates Florida Governmental Utility Authority (Lehigh Utility System) Util Revs 'A-'
Wednesday November 23, 2:17 pm ET


TAMPA, Fla.--(BUSINESS WIRE)--Nov. 23, 2005--Fitch Ratings assigns an 'A-' rating to Florida Governmental Utility Authority (FGUA, or the authority) (Lehigh Utility System), FL's approximately $25 million utility revenue bonds, series 2005, and affirms the 'A-' rating on approximately $42.3 million outstanding parity debt. The series 2005 bonds are scheduled to sell on Dec. 5 via negotiation to Banc of America Securities LLC and UBS Financial Services, Inc. The Rating Outlook is Stable.


The 'A-' rating on these bonds is based on the growing service area of Lehigh Acres, where the Lehigh utility system (the system) is located, adequate projected debt service coverage assuming automatic inflationary rate increases pursuant to an adopted ordinance, and satisfactory legal provisions. Credit concerns include high rates, management uncertainties given that private third parties manage and operate the authority and the system, and higher than expected capital needs requiring further leveraging of system resources.

FGUA was formed in 1999 by an interlocal agreement to purchase a number of water systems in Florida from a private developer. Current membership includes Polk, Citrus, Lee and Osceola counties. The authority is managed by a governing board whose members include one representative of each entity. FGUA has no employees; all services are provided on a contractual basis. Each utility owned by FGUA is accounted for as a separate enterprise fund and managed independently. The Lehigh Acres utility system was acquired by the FGUA in December 2003. The system is operated under a utility operations and billing and customer service agreement with Severn Trent-Avatar Utility Services LLC, a contractor providing similar services throughout Florida. FGUA has retained Government Services Group, Inc., a private contractor, for the overall management of the authority.

The bonds are secured by a pledge of the trust estate, which includes net revenues and connection fees of the Lehigh system. The system serves the Lehigh Acres area of unincorporated Lee County and is a primarily residential community, 100 square miles in area, located about 12 miles east of Fort Myers. The service area is only 10% built out, with 90,000 platted lots available for development. Wealth indicators for nearby Fort Myers and the county suggest income levels corresponding to the Lehigh Acres service area are in the average range. In July 2005, the system provided service to approximately 11,294 water customers and 9,209 wastewater customers.

The fiscal 2006-2010 capital improvement plan (CIP) totals a sizeable $55.1 million. Current capital costs are substantially higher than the $15.9 million initially estimated at the time the authority purchased the system from Florida Water Services Corp. (FWS), largely as a result of accelerated customer growth patterns. On the water side, consumptive demand exceeded permitted treatment capacity in 2005. In response, the authority will construct an additional water treatment plant with proceeds from this issuance. The plant is expected to be in operation by the end of the 2007 calendar year, but in the interim, the authority has entered into an agreement with Fort Myers for additional supplies.

On the wastewater side, the authority initially believed wastewater treatment capacity was sufficient through 2008. But growth has outpaced projections and in fiscal 2005 the wastewater treatment plant exceeded its permitted flow capacity. The authority is currently negotiating a consent order with the Florida Department of Environmental Protection which identifies flow capacity and disposal capacity issues. The authority's CIP includes projects necessary to mitigate the violations, including the construction of a deep-well injection system to address effluent overload.

Historical financial data through fiscal year 2003 provided by the previous owner of the system, FWS, was based on calendar years and adjusted for expenses, such as property taxes, that applied to FWS as a private company but does not apply to FGUA as a governmental entity. Over that period, operating margins were sound. Audited results for fiscal 2004, the first full year of operations by FGUA, indicate a healthy financial position, with 324 days cash on hand, and sound net revenues to pay debt service. Debt service coverage in fiscal 2004 exceeded projected results with net revenues available equal to 3.4 times (x) annual debt service (ADS) including connection fees and 1.9x with the fees excluded.

Projections compiled by a feasibility consultant indicate a decline in ADS coverage through fiscal 2010 as a result of these bonds and $18.9 million in additional debt planned through the forecast period, but coverage is expected to be adequate at no less than 1.5x and 1.2x ADS through fiscal 2010 including and excluding connection fees, respectively. The projected cash flows include annual automatic inflationary rate increases approved by the authority and an additional 3% hike expected to be approved for fiscal 2009. However, Fitch notes that customer charges currently exceed affordability levels at around 2.4% of median household income, and additional rate increases may pressure system customers.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.



Contact:
Fitch Ratings
Kelly McGary, 813-223-6600 (Tampa)
Chris Hessenthaler, 212-908-0773 (New York)
Christine Pollak, 212-908-0526
(Media Relations, New York)

--------------------------------------------------------------------------------
Source: Fitch Ratings

FGUA and the system

There are about 8,000 existing FGUA sewer customers in Lehigh Acres.
By FGUA's outdated, one-year old statistics, their existing 2.5 million gallon per day sewer plant was operating at a yearly (2004) effluent flow of 2.13 million gallons per day. We all know that there have been a substantial number of additional hookups in 2005, and our educated guess is that the existing plant is operating at, or over, its maximum allowable AVERAGE capacity.

According to your figures from the Lee County Planning records there are an additional 3,534 hookups, or Equivalent Residential Connections (ERC's) up for review represented by the five projects you detailed in your recent report as listed below:

Buckingham Villages 631
Section 10 1,750
Caloosa Lakes 800
Mirror Lakes Village 130
Prairie Creek 223

Just These 5 Equal 3,534

And that's only the residential units in those projects, not the commercial square footage, which will also have a huge impact on the FGUA sewer plant.

Now let's add a few more additional hookups that we know are coming soon:

Savanna Lakes 1,999
Mirror Lakes Golf Course 400
Admiral Lehigh Golf Course 250
Majestic Golf Course 170
Beth Stacey Multi Family 380
Copperhead Golf Course 400
Next Phases of Towne Lakes 230
Flint Farm 400

Just These 7 Equal 3,869

Again, this does not include commercial components, new schools, new businesses along Lee Blvd.and in the Industrial Park, smaller, pocket developments of townhouses and other multi-family projects, etc., etc., etc.

Adding only the RPD's listed above, that accounts for an additional 7,403 hookups - almost DOUBLE the existing FGUA customer base in Lehigh Acres.

No wonder FGUA is in such a hurry to expand! Even their additional 1 million gallon per day expansion is not enough to handle the increase caused by the Lee County government's reckless disregard for concurrency, the Red Zone and their own Comprehensive Plan. They are simply rubber stamping development orders for more residential units than FGUA can possibly handle. Something, or someone has to give!

Yes, FGUA is planning a 7+ million-dollar deep well injection project to handle the increased effluent (at our expense). Whether you think deep well injection is safe, or not, everyone agrees that it will take at least three to four years to permit and build it. By then all the RPD's listed above will be completed.

So what happens if FGUA, Lee County and the FDEP continue to ignore the obvious math here? The excess "production" has to go someplace.

1. More effluent will be dumped into Lehigh Acres' canals, and ultimately into the Orange River and the Caloosahatchee River. Commissioner John Albion is suing the South Florida Water Management District to stop the dumping of polluted runoff from Lake Okeechobee, but the ugly truth is that 70% of the pollution is coming from the Caloosahatchee watershed, downriver from Lake O, caused by runoff from overdevelopment in Southwest Florida. This is nothing short of an environmental crime against the people of Florida. Albion is not trying to fix the problem. As usual, he is trying to fix the blame.

2. Our community will be placed at considerable health and safety risks because the water pressure in Lehigh Acres will drop to dangerous levels. According to the FDEP the minimum safe water pressure is 20 pounds per square inch (psi). The water pressure in my neighborhood has been recently measured at 22 psi, dangerously close to the level where the water will backflow causing contamination. My home was built 14 years ago, before backflow safety valves were required in new construction. Like many homeowners in Lehigh, we will have to boil our water before using it if the water pressure drops below 20 psi.

3. With low water pressure, our fire hydrants will fail, and there will be no way to sprinkle the top floors of all those Lehigh multi-family projects in the pipeline.

4. With no adequate fire flow our insurance rates will go up, and worse, we won't even be able to fight brush fires and house fires with our garden hoses.

Somebody is lying through their teeth and endangering the entire community.

We already know that Albion and Darth Stilwell won't listen. FGUA won't admit to its failure to plan ahead years ago. FGUA is not responsible to the PSC like other utilities are. Our only recourse is to hold the State Department of Environmental Protection accountable for this looming environmental catastrophe.

I suggest that we start a petition drive to demand that the Florida Department of Environmental Protection and the Florida Department of Law Enforcement launch an immediate investigation into this urgent matter.

To do less would increase the threat to the health, safety and welfare of the citizens of Lehigh Acres.

Thank you for your time, interest and thoughtful consideration.

Warmest Team Lehigh Acres Regards,

Jim Fleming

Utility may ease pain in Citrus Springs (Citrus Springs)

Florida Governmental Utility Authority officials said Monday that they would scale back the number of units in Citrus Springs that would pay proposed water extension line fees.

Last week, the utility said it wanted to levy a $2,330 water line extension assessment on 5,700 vacant lots in Citrus Springs. But at Monday's continuation of a hearing before the county's Water and Wastewater Authority, FGUA director of operations Charles Sweat said that special assessment area would be reduced to about 3,300 residential units.

The reduction came in response to a request by Robert Knight, director of utilities regulation, who said during Thursday's hearing that the original proposed assessment area was too large.

The utility is also proposing an annual fee of $16.55 in Citrus Springs and $37 in Pine Ridge for line maintenance. Those fees would be paid by owners of vacant property abutting water lines.

The Water and Wastewater Authority began meeting Nov. 9 to decide whether the proposed fees are fair and whether the FGUA's proposed water line construction is appropriate.

Because the authority received several new exhibit filings from FGUA officials Monday, the five-member board voted to postpone its decision on the fees until its Dec. 5 meeting.

At Monday's hearing before the Water and Wastewater Authority, an attorney for the FGUA and two attorneys representing property owners in Citrus Springs and Pine Ridge presented their closing arguments.

FGUA attorney Brian Armstrong summarized the utility's proposed fees. Owners of lots that had water lines in front of them before Dec. 5, 2003, would continue to pay the existing water line extension fee of $446. Owners of lots connecting to water lines extended by FGUA since Dec. 5, 2003, would pay $2,199 starting Feb. 1, 2006. And owners of lots in the special assessment district would pay $2,395 over 20 years, or $261 per year.

That assessment would be reduced to $1,924 if the owners decided to pay up front before the FGUA obtained bond financing, Armstrong said.

The fees are necessary to make growth pay for itself in areas that have seen rapidly increasing home construction, he said.

"Everybody is looking at areas like Citrus This is the place where you can still make that purchase as an investor. You can still buy an affordable piece of property," Armstrong said. "There's nothing worse than not being prepared for that growth when people start coming and want to build in these areas."

Emily Peacock, a Tampa lawyer representing the Citrus Springs Landowners Association, said creating a blanket special assessment would infringe on the rights of property owners who paid for utility service when they purchased their land.

Peacock and Tallahassee lawyer Mike Twomey, representing the Pine Ridge Property Owners Association, argued that the line maintenance fees were not fair or justified.

Charging line maintenance fees would be "undue discrimination under the law," Twomey said, adding that he would urge his clients to appeal if the authority approved the fees.

Catherine E. Shoichet can be reached at cshoichet@sptimes.com or 860-7309.

Utility offers compromise on water fees, but board puts off final decision (Citrus County)

By Terry Witt

A government utility made a concession Monday in hopes of securing county approval for water line property assessments in Citrus Springs, but a regulatory board deferred a final decision until December.

The Florida Governmental Utility Authority offered to reduce the size of its proposed property assessment district to about 3,349 lots, which is more to the liking of Utilities Regulatory Director Robert Knight, but Knight made no promises.

Knight, who advises the Citrus County Water and Wastewater Authority on utility issues, asked WWA to postpone a decision until Dec. 5 about whether FGUA should be allowed to levy water line extension assessments in Citrus Springs and water line maintenance assessments in Pine Ridge and Citrus Springs. WWA agreed to the postponement.

FGUA has proposed annual water line maintenance assessments of $16.55 in Citrus Springs and $37 in Pine Ridge.

Knight said reducing the assessment district size is no guarantee FGUA will receive a favorable recommendation from him. Brian Armstrong, an FGUA attorney, said the smaller district was offered as a second alternative to give WWA and Knight a choice.

Reducing the size of the district gives FGUA a better chance of building all the water lines inside the district within five years, a standard gauge for determining whether the district was the right size, but Knight said he would have to review the numbers between now and Dec. 5 before making his determination.“Whether I will recommend it for approval is still up in the air,” Knight said.

FGUA claims a high growth rate in Citrus Springs is forcing it to look for a stable revenue source to build the millions of dollars in new water lines. Some WWA members have questioned whether the assessments are justified or necessary. Others think FGUA has made a legitimate argument.

Armstrong said the final assessment numbers are as follows:* Residents in the proposed water line assessment district could prepay a reduced assessment of $1,924 as a lump sum. The option would probably be available until May 1 of next year.* Residents in the assessment district who choose to finance the fee would be assessed $2,395. The annual charge would be $261 on their property tax bill.* Residents living outside the assessment area would pay $2,199 for any new FGUA line extension.* Those residents who had lines built to their vacant lots before FGUA bought the Citrus Springs utility would be charged $446 for a line extension under the old Topeka developer’s agreement.

Pine Ridge resident Robert Bennett, a critic of FGUA’s proposals, said FGUA’s 2006 budget is filled with unjustified expenses and numbers that don’t add up.He said the “community service initiative” in the 2006 budget — which he said is an $855,798 public relations campaign — would be unfairly borne by its customers.

He accused FGUA of using fuzzy math to mislead its customers and the regulatory board, and used a toy duck to illustrate his disgust with the utility.

The duck played a muffled recording of the one-liner made famous in AFLAC Insurance television commercials. The duck squawked — “AFLAC!”Attorney Mike Toomey, representing Pine Ridge, attacked the $37 line maintenance assessment. He said it amounted to double charging Pine Ridge residents.

Toomey said residents in Sugarmill Woods and Pine Ridge, two of FGUA’s largest systems, had paid for maintenance of the lines as part of their rates before FGUA bought the systems. Toomey said it would be illegal to charge residents of Pine Ridge a second time.

Toomey represents the Pine Ridge Property Owners Association. If WWA approves the maintenance assessment, Toomey said he would encourage the association to appeal the decision.

Utility details water fee request (Citrus Springs)

A hearing will resume Monday on the Florida Governmental Utility Authority's proposal.By CATHERINE E. SHOICHET Published November 12, 2005

LECANTO - As the marathon meeting that lasted nearly 10 hours Thursday began to wind down, a rumpled Robert Sheets approached the lectern in Room 166 of the Lecanto Government Building.

"We've been here a day and a half and I'm not sure we've told you what we want you to do," the Florida Governmental Utility Authority's systems manager told members of the county's Water and Wastewater Authority.

When the hearing continues Monday, he said, FGUA officials will sum up their proposal on a single sheet of paper.

County and FGUA officials had hoped to wrap up the review of proposed water line fees in Citrus Springs and Pine Ridge before the building closed at 9 p.m. Thursday. But after 13 meeting hours, seven witnesses and more than two dozen exhibits containing hundreds of pages of data, they decided to call it a night.

The group, which began meeting Wednesday, will reconvene at 1 p.m. Monday, when the board will open up the meeting to public comment.

FGUA officials say the request behind the lengthy hours of expert testimony and cross-examination is simple: The utility wants to levy a $2,330 water line extension assessment on about 5,700 vacant lots in Citrus Springs. It says that assessment, in addition to an annual $17 fee in Citrus Springs and a $37 fee in Pine Ridge for line maintenance, will make the region's rapid growth pay for itself.

The Water and Wastewater Authority must decide whether those fees are fair and whether the FGUA's proposed construction is appropriate.

To justify their request to the county board that reviews water and sewer rates, FGUA officials assembled a team of engineers, accountants and administrators to testify.

They said that without the proposed assessments, the FGUA would have no way to fund growth other than raising rates.

In addition to extensive questions from FGUA attorney Brian Armstrong, the witnesses fielded questions from two attorneys who criticized the utility's fee plan.

Emily Peacock, a Tampa attorney representing the Citrus Springs Landowners Association, argued in cross-examinations throughout the hearing that the FGUA's proposed approach of levying fees infringes on some property owners' rights.

Utility service was guaranteed in the contracts of Citrus Springs property owners who bought land before 1989 from the Deltona Corp., she said. And some property owners who purchased land after 1989 prepaid $500 for water service and $1,000 for wastewater service.

The FGUA should determine who those property owners are before levying fees, Peacock argued, and those who have already paid should not be asked to pay again.

Peacock and Mike Twomey, a Tallahassee attorney representing the Pine Ridge Property Owners Association, also argued that the annual line maintenance fees are not justified.

Those fees would apply to vacant lots that are not connected to FGUA lines in areas that receive FGUA service. FGUA officials said during Thursday's meeting that the presence of water lines benefits the owners of vacant property by increasing property values and allowing for easy hookup upon request.

"It's our belief that the whole thing is the effort from the utility to capture additional dollars from a select group of people, and that it's discriminatory," Twomey said Friday. "It's unwarranted."

In a staff opinion distributed to Water and Wastewater Authority members before the hearing, utilities regulation director Robert Knight wrote that the proposal to charge line maintenance fees "smacks of double recovery," because existing customers already pay for line maintenance costs.

At Thursday's meeting, Knight also said the FGUA's proposed assessment area is too large and asked officials to put together a plan that would cut the assessment district in half.
Sheets said the FGUA would consider Knight's request over the weekend.

"I would say we're not going to reach a final order on this until our December agenda hearing," Knight said.

In July, the FGUA proposed a fee of $2,082 for residents of Citrus Springs and a $6,571 fee for residents of Pine Ridge who requested water line extensions after Dec. 1, 2003. FGUA officials eventually scaled back that proposal, eliminating the line extension fees for Pine Ridge residents and changing the proposed starting date several times.

In September, the Water and Wastewater Authority approved an interim fee of $2,068 for Citrus Springs residents requesting water line extensions.

The FGUA's original fee proposal presented in July drew intense criticism from residents and county commissioners.

Since then, Sheets has become a familiar figure at Citrus County government meetings, attempting to assuage the fears of skeptical county officials who have said the utility lacks accountability.

Last month, the County Commission voted unanimously to hire a Tallahassee law firm to help the county evaluate whether to purchase the FGUA's 11 Citrus County systems.
Thursday evening, Sheets stressed once again that the FGUA was not the county's adversary, but a partner.

"If you build it, they will come," Water and Wastewater Authority Chairman Mike Smallridge said in response to Sheets' explanation of the need to levy assessments to fund growth.

"They're going to come, and we're going to have to build it," Sheets replied.

Catherine E. Shoichet can be reached at cshoichet@sptimes.com or 860-7309.

Headlines

The Poinciana civic organization will meet Tuesday, Nov. 16, 7:30 p.m., at the Poinciana Community Center. The guest speaker will be Charles Sweet, who works for the Government Services Group/FGUA, and will speak about water conservation.

Proposed fee gets cool reception (Citrus Springs)

Proposed fee gets cool reception By Terry Witt

Utility: Money needed to pay for growth Officials of a government utility floated a plan Thursday to levy a $2,330 water line extension assessment in a portion of Citrus Springs, but a regulatory board gave it a lukewarm reception.Florida Governmental Utility Authority officials asked for permission to levy the special property assessment on about 5,700 vacant lots in what they described as the highest growth area in Citrus Springs.

Under the FGUA plan, a property owner who paid the fee in advance would be entitled to a reduced fee of $1,905.

FGUA also asked the Citrus County Water and Wastewater Authority for permission to impose a $17 water line maintenance assessment fee in Citrus Springs and a $37 line maintenance fee in neighboring Pine Ridge.

WWA made no decision, but suggested alternatives to a water line extension assessment.The two-day hearing was due to be continued on Monday at 1 p.m., when public comment will be heard. The hearing will take place Room 166 of the Lecanto Government Center.

Representatives of the government-owned utility said high growth in Citrus Springs is forcing them to abandon the “build as you go” method and switch to a more predictable revenue source they can borrow against. They said property assessments are the best method to build line extensions.

Citrus Springs is a planned community of about 34,000 lots in northern Citrus County. FGUA has proposed a six-phase plan to provide water lines to the entire community, much of which is undeveloped. WWA is considering the first phase of the plan.

However, WWA member Robert Hnat said he thought the assessment was too high considering the savings FGUA would realize by concentrating most of its water line extension work in a single area of the community — the first phase. He suggested the utility lower the assessment.Utility Regulatory Director Robert Knight, who advises WWA, said he would look more favorably on an assessment district about half the size of the one FGUA has proposed. He said the current FGUA plan involves building water lines too far in advance of when they might be used.

Board member Ronald F. Broadbent suggested abandoning the special assessment plan completely and instead focusing on one of the main problems facing FGUA when it builds big water line extensions.

FGUA officials often have complained that the Topeka developer’s agreement in Citrus Springs requires the utility to extend water lines to any property owner who lives within 2,500 feet of an existing line. But if only one customer requests service, the new water line sometimes passes by 19 or 20 vacant lots to reach the new customer. The other vacant lot owners are not charged because they are not requesting service.

Broadbent wondered if FGUA couldn’t solve the problem by charging all the lot owners who benefit from such a long water line extension. Attorney Brian Armstrong, who represented FGUA, said WWA could amend the Topeka agreement to raise the line extension fee and make it apply to the vacant lot owners Broadbent identified.

Regulatory official says proposed fee is excessive (Citrus County)

By Terry Witt
The county’s utility regulator on Monday said he is recommending denial of a government utility’s request to impose a $2,068 special property assessment to pay for water line extensions in Citrus Springs.

But Utility Regulatory Director Robert Knight said the Florida Governmental Utility Authority is entitled to earn more than the $446 per lot it currently collects for line extensions.

The unanswered questions: How much should the utility charge, and what is fair?

Knight will discuss his recommendations Wednesday afternoon when the Citrus County Water and Wastewater Authority convenes for a three-day public hearing to consider FGUA’s proposals. Knight advises the WWA on rate and utility regulatory issues.

FGUA also wants to impose a line maintenance fee of about $15 in Citrus Springs and $30 in Pine Ridge, according to Knight, but he will recommend a flat denial of those fees. He said FGUA is already recovering its maintenance costs through its water and sewer rates.

The hearing begins at 3 p.m. Wednesday in Room 166 of the Lecanto Government Building. It reconvenes at 8:30 a.m. Thursday, and if need be, the hearing can be extended to 8:30 a.m. the following Monday. The room is reserved for all three days.

FGUA has been criticized by some residential customers for attempting to impose the property assessments without county review. County commissioners agreed and argued the county’s interlocal agreement with FGUA gave the county regulatory authority over the assessments. FGUA relented and allowed the review.

Knight said he agrees FGUA has the right to recover its costs in building new water lines, but $2,068 is excessive. In the agenda package, Knight lists his recommendations and his gives reasons.

He initially suggested that a property assessment of $1,554 would be enough to cover line extensions, but that figure was based on the company issuing bonds to pay for the extensions. Knight said a bond issue would cost money. He thinks FGUA can recover its costs by charging customers more for line extensions as they build them rather than incurring the costs of a big bond issue.

Knight said FGUA’s numbers are based on its plan to build 34.5 miles of water line in Citrus Springs in the first of six phases, but he said the plan is to extend water lines to areas not currently under development, and he disagrees with that philosophy. He said it is not justified.

However, he added that FGUA should be able to recover its costs when it builds a water line that passes 20 vacant lots to reach a new home at the end of the street. Every vacant lot owner should pay an equal share of the cost. But Knight said FGUA is currently absorbing the cost of building lines past the vacant land. He said that isn’t fair to the utility.“They’re only recovering 4 percent of their costs,” he said.

News Headlines ---------

Water, sewer system upgrade OK'd
The News-Press - Nov 04 10:21 PM Lehigh Acres' water and sewer system will get a $25 million upgrade and expansion, but who will run it is yet to be determined. The Florida Governmental Utility Authority board met Friday and passed the bond issue to help pay for the expansion.

Commission opts to settle land use suit
St. Petersburg Times - Oct 26 10:53 PM The county's settlement would pave the way for the estate of a property owner to build homes on what used to be a recreational vehicle park.

Utility board to discuss options FGUA
The News-Press - Oct 18 10:22 PM The board that controls Lehigh Acres' water and sewer system will meet in Lehigh Acres on Friday to discuss the county's intentions to take over operations and eventually buy the system.

County to study water system takeover
St. Petersburg Times - Oct 11 10:26 PM Commissioners are concerned the Florida Governmental Utility Authority lacks accountability.

County delays utilities purchase (Citrus County)

By Terry Witt
The Florida Governmental Utility Authority has postponed discussion of a new operations contract for 60 days to give Citrus County time to evaluate the purchase of 11 local utilities. FGUA’s board voted Friday for the postponement.

Citrus County commissioners had earlier asked FGUA to delay for 60 days a decision on its pending operations contract to allow time for a study of the potential purchase. The county has hired two consultants to conduct the study.

Commissioners said they have lost confidence in FGUA’s ability to manage its 11 utilities in Citrus County. The county would like to own the systems if the purchase is economically feasible and doesn’t raise customer bills.

FGUA Systems Director Robert Sheets said he doesn’t know how the recommended bidder for the operations contract will react to the postponement. A committee of FGUA officials had negotiated a five-year contract of about $62 million with Wade Trim/US.Wade Trim’s initial contract bid of $79.9 million bid was $21 million higher than the lowest bidder. The bid has since been negotiated down to about $62 million, according to FGUA.

Severn Trent, the current operations manager, was granted a six-month extension of its current contract to operate FGUA’s systems until a new contractor takes over. The Severn Trent contract can be terminated with 60 days notice, Sheets said.

FGUA’s three biggest utility systems in Citrus County are Sugarmill Woods, Pine Ridge and Citrus Springs. Those three communities account for 70 percent of FGUA’s customers.One of the events that triggered the county’s interest in purchasing FGUA’s local holdings was a decision earlier this year by FGUA to impose property assessments in Pine Ridge and Citrus Springs to pay for water line extensions. The Pine Ridge portion of the proposal was later dropped, but the special assessments in Citrus Springs are pending review by the Citrus County Water and Wastewater Authority.

When customers protested the assessments, and the county insisted on intervening, FGUA said the county had no authority to make such an evaluation. The government utility later relented and granted WWA the right to review the rates, but only at the insistence of the county commission.

WWA has granted FGUA an interim rate hike to impose the assessments in Citrus Springs until a final decision is rendered in November.

Stinky's Cousins ------

Something Stinks in Lehigh Acres it's called

FGUA and GSG ---

The Stinky's Cousins just approved 25 million dollars in bonds for upgrades on the WTP / WWTP systems in Lehigh ---

Can we the citizens of Lehigh Acres afford this????

Water, sewer system upgrade OK'd

By: Joel Moroneyjmoroney@news-press.com news-press.com
November 05, 2005

Lehigh Acres' water and sewer system will get a $25 million upgrade and expansion, but who will run it is yet to be determined.The Florida Governmental Utility Authority board met Friday and passed the bond issue to help pay for the expansion.But it delayed for 60 days a decision on the renewal of the system's operating contract with an outside company.

The board is working with Lee County Utilities on a cooperative agreement that will ensure system upgrades meet county standards.Commissioners have discussed having the county assume control of the system.

"This is so that, should we take the system over in the future, it will comply with county standards," said county Public Works Director Jim Lavendar, who represents Lee County on the FGUA board. "What we're doing now is making a future transition easier, should it occur."The authority — composed of representatives from Polk, Citrus, Osceola counties and, since last month, Lee County — is seeking to expand the system in order to reduce the number of wells and septic tanks in the area.Currently, just 12,000 Lehigh residents are on the system, Lavendar said.

But residents have voiced concerns about property assessments for mandatory connection to the system even if they have working wells and septic tanks.Those concerns spurred commissioners to discuss county ownership.

Frank Lohlein, an opponent of the buildout, said residents could face bills surpassing $17,000 each to finance the expansion.Lohlein's primary argument against the plan is that there's no proof — in surveys or studies — that the current system cannot handle the influx of new residents to the area, he said.

Speaking on Friday evening, Lohlein pointed to what he called improper collusion between the authority and the Government Services Group, a private consulting firm contracted by the authority that is run by Robert Sheets, a systems manager for FGUA.

"It's a game that they play — not telling the whole truth to everyone," he said of the FGUA.Ralph Hemingway, a former Lehigh Acres fire commissioner who has consulted state water officials on capacity issues, said he's siding with the FGUA to maintain control and bolster the structure of the system.

Hemingway cited outdated, low-capacity pipes that will not be able to accommodate existing residences once new developments are built."The way Lehigh is growing, they're going to have to put in more or they'll see drastic problems," he said Friday evening.