MAYOR’S OFFICE OF
COMMUNICATIONS
55 Trinity Avenue, Suite 2500
Atlanta, Georgia 30303 |
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| CONTACT: |
Sandra Allen Walker, Director |
| Office |
404-330-6395 |
| Cell: |
404-925-1666 |
| E-mail: |
swalker@ci.atlanta.ga.us |
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or |
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LaChandra Butler |
| Office: |
404-330-6248 |
| Cell: |
404-886-2334 |
| E-mail: |
ldbutler@ci.atlanta.ga.us |
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December 5, 2003 |
Text of Watershed Management
Commissioner Jack Ravan's Letter to EPA and EPD
CORRECTED VERSION (12/5/03) December 4, 2003
VIA FACSIMILE AND CERTIFIED MAIL RETURN RECEIPT REQUESTED
Chief, Water Programs Enforcement Branch Water Management Division
U.S. Environmental Protection Agency, Region 4 Atlanta Federal
Center 61 Forsyth Street, S.W. Atlanta, Georgia 30303 ATTN:
Douglas Mundrick
Georgia Environmental Protection Division Permitting, Compliance,
and Enforcement Program 4220 International Parkway, Suite 101
Atlanta, Georgia 30354 ATTN: Marzieh Shahbazaz
Subject: Notice of Delay to EPA and EPD Consent Decree - City
of Atlanta First Amended Consent Decree - City of Atlanta Civil
Action File No. 1:98-CV-1956-TWT
As required under Section XII, Force Majeure (C), of the Consent
Decree (CD) and First Amended Consent Decree (FACD), the City
of Atlanta submits this notice of events arising from actions
by the Atlanta City Council on December 1, 2003 that will delay
or prevent the performance of its obligations under the CD and
FACD, despite the City's best efforts to fulfill these obligations.
As required, this notice is submitted within fifteen (15) days
after the City has learned or should have learned of the delay
or anticipated delay. The potential delays are both capital
and compliance in origin. This letter sets forth precipitating
events for potential delays, the nature of the delays and the
proposed plan of action to cure the delays.
On Monday, December 1, 2003, the Atlanta City Council approved
a water and sewer rate increase ordinance and a Department of
Watershed Management (DWM) budget ordinance. These ordinances
differed significantly from the proposed rate increase and budget
requests put forward by the City's administration as a component
part of meeting the terms and conditions of the Consent Decrees.
Specifically, the approved rate increase ordinance, 03-O-1713,
substantially diminished the effective rate increase sought
of 45% for FY 2004 by providing an "affordability base
rate" exemption of six hundred cubic feet per month for
all customers at the current rate. In addition, the budget ordinance
cut $25 million from the DWM operations budget for 2004.
One immediate consequence of the ordinances passed by City
Council is the inability of the City to issue new bonds in 2004.
The six hundred cubic feet rate structure as passed by the Council
undermines the financial strength and stability of the water
and wastewater fund. Specifically, it results in a revenue loss
of $25 million in the first year which compounds to over $75
million by the fifth year and also results in a declining debt
coverage ratio. Consequently, this rate structure does not provide
for a solid five year financial plan or revenue stream that
can adequately demonstrate to Wall Street that the City can
support any future borrowing. Absent the necessary revenue generated
by issuance of new bonds, the City will be unable to meet the
capital needs anticipated for the coming fiscal year. Therefore,
under the current capital projects schedule, the City will not
be able to initiate new consent decree projects beginning in
July 2004.
In addition to failing to meet this calendar, there is a more
immediate compliance impact. The lack of funding will require
the City of Atlanta to prioritize its capital projects with
an emphasis on the provision of basic drinking water and sewer
service and the protection of public health over consent decree
compliance. The effect will be that we will not initiate consent
decree compliance projects that were scheduled as early as January
2004.
A specific failure is the West Area Tunnel project. Set forth
below is the proposed schedule for West Area Tunnel completion:
Activity Date Float CD Milestone Complete Design Jan. 2, 2004
0 Jan. 2, 2004 BOP Advertises Constr. Jan. 2, 2004 37 None
DOP Receives Bids Mar. 17, 2004 0 None
Contractor NTP June 21, 2004 21 Jul. 12, 2004 Substantial Completion
Nov. 3, 2007 4 Nov. 7, 2004
However, given the City Council's actions, we will be unable
to meet this schedule. The City would have started the bid process,
which would have included the advertisement and the release
of bid plans, on January 2, 2004. This schedule would have provided
62 days of float through the final construction deadline. Due
to the revenue constraints to completing this project, the City
will be unable to even advertise the project or to go forward
with the Tunnel project in any meaningful form.
A third major area of potential delay, also precipitated by
the City Council's approved rate increase, is that the revenue
stream will not provide adequate financial resources for the
Renewal & Extension Fund. This means that the $30 million
worth of smaller capital repair and system improvement projects
will not be performed as required.
The fourth major area of potential delay is precipitated by
the budget ordinance. The financial analysis conducted by DWM
of the approved budget indicates that the budget will not provide
the funding necessary to meet the compliance, capital project
and operational requirements under the two Consent Decrees.
The City Council's approved budget ordinance reduces the Department
of Watershed Management's budget by $25 million for 2004. The
effects of this budget reduction include the fact that the City
will not be able to adequately fund the required management,
operation and maintenance systems as required under the Consent
Decrees. In addition, we will not be able to fund the management
system improvements that we have recently committed to in our
Indian Creek report and presentation. The conditions that led
to the construction failure at Indian Creek, including inadequate
funding and delays in project initiation, will not be corrected
but will be further exacerbated under the City Council's approved
ordinances.
Absent action by the City Council to approve adequate funding
and to rescind substantial cuts to the DWM operational budget,
the City cannot in good faith offer a plan of proposed compliance.
Thank you for your consideration of this notification. If
you require additional information, please let us know or call
me at (404) 330-6522.
Sincerely,
Jack Ravan
Commissioner of Watershed Management
City of Atlanta
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