Proposed Sewer & Water Rates. City of Placerville, California February 13, 2018

Size: px

Start display at page:

Download "Proposed Sewer & Water Rates. City of Placerville, California February 13, 2018"

Suzanna Wood
5 years ago
Views:

1 Proposed Sewer & Water Rates City of Placerville, California February 13, 2018

2 Overview Community outreach Proposed rates Proposition 218 procedures Next steps Questions and answers 2

3 Why new rates? We must establish rates that cover the actual cost of operating and maintaining the sewer and water systems over the next 5 years. 3

4 Community Outreach April 13, 2017: Measures H/L Sales Tax Committee (MHLC) discussed sewer charge discount program July 27, 2017: MHLC discussed sewer & water rates & sewer discount program August 22, 2017: Presented rate study update to the City Council September 10, 2017: Published Public Notice October 19, 2017: MHLC received update on rate study 4

5 Community Outreach (Cont,) November 2, 2017: MHLC discussed draft sewer & water rates & discount program November 8, 2017: Held Rate Workshop November 10, 2017: Published Public Notice November 16, 2017: MHLC recommended discontinuing the discount program & fund sewer debt coverage ratio November 28, 2017: Presented proposed sewer and water rates to City Council December 2017: Mailed Proposition 218 Notice 5

6 Community Outreach (Cont.) January 10, 2018: Distributed FAQs January 31, 2018: Published Public Notice February 7, 2018: Published Public Notice 6

7 The Difference Between Operating Costs & Projects Sewer & water rates pay for operating costs Measures H & L sales taxes pay for projects 7

8 Water Rates 8

9 How are my water dollars spent? Adopted Budget Fiscal Year 2017/2018 Personnel $0.36 Supplies $ Overhead $0.12 Services $0.04 Equipment, Contingency, Debt Service, & Other Expenses $0.15

10 Our Water Dilemma *Assumes no water rate increases. 10

11 Proposed Water Rates Rate Category Bi-Monthly Single-Family Residential Current Rates February Proposed Rate Increase 7.50% 7.00% 5.50% 5.00% 4.50% Base Charge $27.56 $20.75 $22.21 $23.44 $24.62 $25.73 All Cubic Feet $/ccf $4.15 $4.45 $4.70 $4.94 $ to 1,000 Cubic Feet $2.94 1,001 to 2,500 Cubic Feet $3.52 Over 2,500 Cubic Feet $

12 Proposed Water Rates (Cont.) Rate Category Bi-Monthly Single-Family Lifeline Residential Current Rates February Proposed Rate Increase 7.50% 7.00% 5.50% 5.00% 4.50% Base Charge $20.68 $15.57 $16.67 $17.58 $18.47 $19.30 All Cubic Feet $/ccf $3.12 $3.34 $3.53 $3.71 $ to 1,000 Cubic Feet $2.22 1,001 to 2,500 Cubic Feet $2.65 Over 2,500 Cubic Feet $

13 What will this cost me? Increase in Bi-Monthly Single-Family Residential Water Bill (1,400 Cubic Feet) $9.00 $8.00 $7.81 $7.00 $6.00 $5.77 $5.66 $5.00 $4.00 $3.00 $2.00 $1.00 $4.18 $4.73 $4.54 $4.33 $3.57 $3.41 $3.21 $0.00 February Single-Family Residential Single-Family Residential-Lifeline 13

14 How do we compare? Regional Water Bill Comparison November 2017 For Two Months of Service - 14 ccf (average use) $140 $120 $100 $92.98 $97.28 $99.57 $ $ $ $ $ $80 $60 $45.12 $59.76 $61.52 $71.04 $78.85 $80.24 $40 $20 $0 Fixed Charge Variable Charge 14

15 What could happen during a drought? City, EID, and/or the State could declare a drought and mandate water conservation Could result in significant loss of revenue City may need drought rates to offset cost of lost revenue 15

16 Proposed Drought Water Rates Proposed Rate Category Current Rates February Single-Family Residential Base Charge $27.56 $20.75 $22.21 $23.44 $24.62 $25.73 All Cubic Feet $/ccf $4.73 $5.10 $5.40 $5.69 $ to 1,000 Cubic Feet $2.94 1,001 to 2,500 Cubic Feet $3.52 Over 2,500 Cubic Feet $3.81 Single-Family Residential Lifeline Base Charge $20.68 $15.57 $16.67 $17.58 $18.47 $19.30 All Cubic Feet $/ccf $3.55 $3.83 $4.05 $4.27 $ to 1,000 Cubic Feet $2.22 1,001 to 2,500 Cubic Feet $2.65 Over 2,500 Cubic Feet $

17 Sewer Rates 17

18 How are my sewer dollars spent? Adopted Budget Fiscal Year 2017/2018 Personnel $0.28 Services $0.13 Supplies $0.06 Overhead $0.05 Debt Payments & Coverage, Equipment, Transfers, Contingency, Other Expenses $

19 Why do we have so much debt? Primarily due to $45 million in State mandated improvements to the Sewer Treatment Plant No additional capacity added to Plant NPDES Permit discharge requirements City was under cease and desist order in 2006 No improvements = Fines up to $10,000/day 19

20 Our Sewer Dilemma *Assumes no sewer rate increases. 20

21 Measures H/L Sales Tax Committee Recommendations $548,501 transfer from the Measure H Fund for 20% Sewer Fund debt coverage and sewer projects Avoids 9.89% sewer rate increase Eliminate sewer charge discount program effective February 16, 2018 Equivalent to 9.30% sewer rate increase Included in Proposition 218 Notice 21

22 Proposed Sewer Rates Bi-Monthly Sewer Rates and Discounts - Single-Family Residential Proposed Rate Category Current February Single-Family Residential Sewer Rate Increase 5.75% 7.25% 4.50% 4.00% 3.00% Base Charge $ $ $ $ $ $ Per 100 Cubic Feet Over 750 cf $7.51 $7.94 $8.52 $8.90 $9.25 $9.53 Single-Family Residential - Lifeline Base Charge $ $ $ $ $ $ Per 100 Cubic Feet Over 750 cf $5.63 $5.96 $6.39 $6.68 $6.94 $7.15 Single-Family Residential - All Sewer Charge Discount $15.00 $0.00 $0.00 $0.00 $0.00 $

23 What will this cost me? Increase in Bi-Monthly Sewer Bill - Single-Family Residential (1,050 cf) $30.00 $25.00 $25.62 $20.00 $15.00 $10.00 $5.00 $14.16 $9.42 $8.75 $6.83 $0.00 February

24 What will this cost me? (Continued) Increase in Bi-Monthly Sewer Bill - Single-Family Residential - Lifeline (1,050 cf) $25.00 $22.96 $20.00 $15.00 $10.00 $5.00 $10.62 $7.07 $6.56 $5.12 $0.00 February

25 How do we compare? Regional Sewer Bill Comparison November 2017 For Two Months of Service ccf (average winter use) $300 $250 $200 $150 $100 $68.61 $91.90 $96.24 $ $ $ $ $ $ $ $ $ $ $ $ $50 $0 25

26 What would happen if the rates are not increased? Experience a growing number of sewer backups and damage to private property Services would have to be cut Increased exposure to State fines Cause the City to default on its Sewer Treatment Plant loan payments 26

27 Proposition 218 Procedures Sent rate notice to all property owners who receive or are eligible to receive City sewer and/or water services 4,231 parcels were sent notices Letters of protest received before Public Hearing Final protest count will be made immediately following Public Hearing 27

28 Next Steps Tonight: Rate Adoption March & May 2018: Additional informational notices to customers April & May 2018: Rate implementation May 2018: First Utility bill with new rates 28

29 Questions and Answers? 29

Finance & Insurance Committee Item 8 February 12, 2018

Finance & Insurance Committee Item 8 February 12, 2018 F&I Committee Item 6-c, page 1 January 11, 2016 Overview Proposed Biennial Budget Operating Budget Ten-Year Financial Forecast Next Steps Finance