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Zeeland council authorizes financial study to evaluate Mead Johnson wastewater connection
Summary
Council approved an $18,000 contract with Utility Financial Solutions to analyze system capacity valuation, cost-of-service and rate implications if Zeeland accepts additional wastewater flows from Mead Johnson; the authorization does not constitute approval to accept flows.
The Zeeland Common Council on June 15 authorized a financial analysis to determine how to value and charge for system capacity should Mead Johnson seek to send additional wastewater flows to the Zeeland Clean Water Plant.
City staff recommended engaging Utility Financial Solutions LLC to perform a significant-user customer analysis with a scope that includes reviewing system development fee methodology, an equity analysis, cost-of-service impacts, updated financial projections and potential effects on contracts with Holland and Zeeland townships. The council approved the engagement with a good-faith estimate of $18,000.
Assistant City Manager/Finance Director Kevin Plockmeyer and Clean Water Plant Committee members told council that preliminary technical modeling indicates the plant can accept Mead Johnson flows under modeled conditions, but further confirmation is needed on Mead Johnson’s flow and loading characteristics, collection-system conveyance, sludge handling, monitoring needs and any required infrastructure improvements.
Plockmeyer emphasized that the approved action funds analysis only; any final decision to accept Mead Johnson flows would require additional technical, financial, legal and operational review and appropriate contractual terms. The Clean Water Plant Committee recommended the study to better understand the potential financial impacts on existing customers and rate structures.
Next steps identified by staff include executing the contract with Utility Financial Solutions, completing the financial analysis, and returning findings to the committee and council for policy decisions.
