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HomeMy WebLinkAboutAgenda Report - May 18, 2011 G-02 PHAGENDA ITEM &%- CITY OF LODI ,. COUNCIL COMMUNICATION Im AGENDA TITLE: Public Hearing to Consider Adopting Resolution Setting Wastewater Rates for Residential, Commercial and Industrial Customers MEETING DATE: May 18, 2011 PREPARED BY: Public Works Director RECOMMENDED ACTION: Public hearing to consider adopting resolution setting wastewater rates for residential, commercial and industrial customers. BACKGROUND INFORMATION: On July 15, 2009, City Council approved wastewater rate increases of 25 percent effective July 16, 2009; 20 percent effective July 2010; 10 percent effective July 2011; and 5 percent effective July 2012. Also, the City Council approved an Engineering News Record — 20 Cities Average (ENR) based indexing of wastewater rates beginning with FY 2012/13. A Proposition 218 procedurewas conducted that validated these actions. Staff has regularly updated the Wastewater Utility Financial Plan with the assistance of the The Reed Consulting Group, Inc., of Sacramento. A copy of the current Financial Plan has been separately forwarded to the Council and is also attached as Exhibit A. The recommended rate adjustments in the Financial Plan are 5 percent beginning July 1, 2011 and 5 percent beginning July 1, 2012. The rates for this next year reflect a 5 percent increase that is substantially lower than the 10 -percent increase approved by Council, and it includes an ENR -index adjustment of 3.60 percent. Staff recommends the City Council adopt usage -based and flat monthly wastewater rates for residential and nonresidential customers as presented in Exhibit B that will become effective July 1, 2011. For residential customers paying a usage -based water bill (approximately3,000), the wastewater usage -based monthly rate will be determined based upon their average monthly water usage from the previous December, January, and February. During the 2012 calendar year, comparative wastewater flat rate and usage -based rate information will be available to customers using the recommended wastewater usage -based rates. Actual billing for wastewater usage -based monthly rates will not begin for the 3,000 initially -billed customers until July 2012. FISCAL IMPACT: Increased revenues to the wastewater utility are required to keep up with cost of service increases and new mandated costs. FUNDING AVAILABLE: Not applicable. A F. Wally 36ndelin PublicWorks Director FWS/pmf Attachments cc: Steve Mann, Information Systems Manager Charlie Swimley, DeputyPublicWorksDirector— Utilities APPROVED: r r' Kon_radt Bartlam,, City Manager K UMUTILITY RATES\W WW\2011 WWW Rate Increase\CPH W WWlncrease.doe 5/9/2011 Exhibit A City of Lodi -- Wastewater Utility Financial Plan Summary FY 08-09 FY 09-10 FY 10-11 50/0 3% 3% 3% 2,864,000 Actual Actual Estimate FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 Overall Rate Increases --> Beginning Balance Revenues Wastewater Sales Infrastructure Replacement Interest Earnings Other Revenues Transfer In for Debt Service (172) Transfer In for Debt Service (173) Transfer From/(To) RSF (174) Total Revenues Expenditures Transfer Out to Gen'I Fund (COS) Transfer Out to WW Cap Outlay (171) Transfer Out To WW Cap. Rsrv. (172) Administration & Other Plant Maintenance Sanitary System Maintenance Storm Drainage Maintenance Industrial System Maintenance 2003 Wastewater COP Debt Service 2004 Wastewater COP Debt Service 2007 Wastewater COP Debt Service Total Expenditures Ending Balance Operating Reserve (25%) Available Balance DS Coverage (min. = 1.20) without COST • Beginning Balance Revenues Transfer In (from 170 -IRC) Transfer In (from 170-Deprec.) Investment Earnings Total Revenues Expenditures :ALUI M 6,590,013 6,686,530 2,589,687 (87,826) 1,059,429 1,146,961 25% 120/a 50/0 50/0 3% 3% 3% 2,864,000 3,473,455 4,008,000 4,851,000 5,195,200 5,154,600 4,226,200 11, 513,389 12,675, 233 13, 309,000 13,974,000 14,421,000 14,912,000 15,434,000 20,156 37,000 68,000 107,000 142,000 170,000 165,000 145,451 473,159 178,900 184,600 190,300 196,100 201,900 1,008,682 - - 151,371 57,000 68,000 79,000 1,792,000 3,709,041 3,504,683 117,000 73,000 - 186,000 (250,000) (250,000) 556,805 - - 622,000 - 11,394,781 13,220,996 14,727,392 15,348,900 14,533,971 14,883,300 15,346,100 16,065,900 1,451,478 1,451,478 1,451,478 1,495,000 1,540,000 1,586,000 1,634,000 1,683,000 3,663,187 196,202 897,000 1,662,000 1,924,200 1,798,600 782,200 118,000 0.90 1.19 1.85 - 750,000 750,000 750,000 1.65 1.25 1.54 2.20 1,008,682 895,607 1,086,750 1,126,900 1,169,400 1,213,900 1,258,500 1,305,100 3,709,041 3,504,683 4,588,716 4,774,000 4,966,000 5,165,000 5,373,000 5,590,000 556,805 601,772 601,150 622,000 644,000 667,000 691,000 716,000 590,900 596,115 563,300 586,000 610,000 634,000 659,000 686,000 20,091 6,714 33,500 35,000 36,000 37,000 38,000 39,000 382,647 382,733 381,000 379,000 381,000 377,000 378,000 378,000 2,145,713 2,148,800 2,148,000 2,139,000 2,138,000 2,140,000 2,140,000 2,135,000 1,592,250 1,588,050 1,589,000 1,599,000 1,599,000 1,604,000 1,603,000 1,607,000 15,120, 794 12,12 2,154 14,192, 894 14, 505, 900 14,189, 771 14,923,900 16, 274, 500 16, 639,100 2,864,000 3,962,842 4,008,000 4,851,000 5,195,200 5,154,600 4,226,200 3,653,000 2,864,000 2,794,000 3,111,000 3,189,000 3,271,000 3,356,000 3,444,000 3,535,000 25% - 1,168,842 897,000 1,662,000 1,924,200 1,798,600 782,200 118,000 0.90 1.19 1.85 1.26 1.42 1.43 1.55 1.65 1.25 1.54 2.20 1.62 1.79 1.82 1.95 2.06 2,199,738 5,035,749 5,006,641 4,198,018 2,171,018 2,528,018 14,018 496,018 2,589,687 196,202 1,000,000 1,000,000 1,000,000 1,500,000 2,500,000 2,500,000 1,073,500 - - - - - - - - - 50,000 63,000 43,000 63,000 - 17,000 2,517,000 3,663,187 196,202 1,050,000 1,063,000 1,043,000 1,563,000 2,500,000 Exhibit A City of Lodi -- Wastewater Utility Financial Plan Summary Capital Projects FY 08-09 FY 09-10 FY 10-11 Compressor 13,859 Actual Actual Estimate FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 Capital Projects 827,176 - Compressor 13,859 Vacumm Truck Engine Repl 17,835 Replacement Vehicle 04-003 - 20,760 Replacement Vehicle 04-137 20,760 - 2010 Storm Impry 2,831 283,358 Charleston Storm Drain Improvements - - Shady Acres Storm Drain PS Improv. Elm Street Storm Drain Improvements - - - - - - - Misc. System Relocations 8,095 35,000 35,000 38,000 39,000 41,000 43,000 Misc. Wastewater Taps 11,196 40,000 40,000 43,000 45,000 47,000 49,000 Collect. System Capac. Enhanc. Projects - 150,000 50,000 108,000 112,000 117,000 122,000 Wastewater Main Replac./Lining Proj. 560,946 100,000 2,080,000 108,000 2,250,000 117,000 2,433,000 Storm Drain Trash Handling System - - 200,000 - - - - Lift Sta. Remote Term. Unit Replac. 20,000 20,000 Vehicle Replac. (04-116) Boom Truck 50,000 - Fats, Oils, and Grease Program - 10,000 Compl. Studies - Cap Impr. & Rollover 60,000 - Plant Maint. & Land Applic. Area Improv. 325,000 Replace 04-95 Vacuum Truck 340,000 Decommission Fleet Service Shop - 17,500 Munic. Service Center PBX Replac. 877 38,000 Munic. Service Center Security Improv. - 10,000 Munic. Service Center Parking Reconstr. 50,000 Munic. Service Center Modular Bldgs. - - Lift Station Generator Replacements 100,000 - 108,000 - - - Vehicles and Other Equipment - 225,000 162,000 169,000 175,000 182,000 FOG Program and Reporting - - - - - Capacity Assurance Plan - - - White Slough Compliance Studies & Rpts 195,168 146,765 30,000 Plant Maint. & Land Applic. Area Improv. - - 370,000 Installation of CARB Filters 30,000 - - Pond Lining Project - - 1,350,000 1,404,000 Laser Alignment Tool 25,000 - - Shop Lathe 18,000 White Slough Roadway Improvements - Effluent Receiving Water Char. Study Report of Waste Discharge Fence Improvements/Repairs - Plant Security Enhancements 50,000 Exhibit A City of Lodi -- Wastewater Utility Financial Plan Summary Miscellaneous Reports Future Projects Total Expenditures Ending Balance Beginning Balance Revenues Transfer In from 173 Transfer In from 170 Interest Earnings Total Revenues Expenditures Capital Projects White Slough Solids Handling Facility White Slough Sludge Thickening Transfer Out to 170 (for DS) Total Expenditures Ending Balance Restricted Debt Service Reserve 2007 COP Proceeds (w/ fiscal agent) Cash Deficit (amt. owed for past DS) Beginning Balance Revenues Wastewater IMF Wastewater IMF from PCE/TCE & WTP Interest Earnings Total Revenues Expenditures Transfer Out (to 170 for DS) FY 08-09 FY 09-10 FY 10-11 FY 11-12 1 FY 12-13 1 FY 13-14 1 FY 14-15 1 FY 15-16 Actual Actual Estimate FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 29,636 11,000 - - - - - - - 108,000 112,000 117,000 122,000 827,176 881,963 1,858,623 3,090,000 686,000 4,077,000 2,018,000 2,951,000 5,035,749 4,350,000 4,198,018 2,171,018 2,528,018 14,018 496,018 62,018 Actual Actual Estimate I FY 11-12 1 FY 12-13 1 FY 13-14 1 FY 14-15 1 FY 15-16 4,455,000 - - - - - (2,411,000) (1,708,371) (899,371) (61,371) 339,000 704,000 915,000 4,067,267 5,393,000 5,882,016 5,887,732 2,270,732 2,270,732 2,270,732 2,270,732 5,930,000 - - - - - - - - 750,000 750,000 750,000 106,371 - - - 342,845 258,992 59,000 88,000 45,000 57,000 68,000 79,000 6,272,845 1,008,992 809,000 838,000 151,371 57,000 68,000 79,000 4,947,112 375,716 - - - - - - - - 803,284 4,455,000 151,371 57,000 68,000 79,000 4,947,112 375,716 803,284 4,455,000 151,371 57,000 68,000 79,000 5,393,000 6,026,000 5,887,732 2,270,732 2,270,732 2,270,732 2,270,732 2,270,732 2,170,000 2,476,087 2,332,103 2,332,103 2,270,732 2,270,732 2,270,732 2,270,732 5,634,000 5,258,284 4,455,000 - - - - - (2,411,000) (1,708,371) (899,371) (61,371) 9,025,263 2,011,000 796,125 1,792,697 116,697 72,697 (503,303) 185,697 261,889 226,270 339,000 704,000 915,000 - 173,567 53,400 8,000 27,000 2,000 2,000 (15,000) 6,000 435,456 279,670 2,888,572 117,000 452,000 341,000 689,000 921,000 1,146,961 1,792,000 1,792,000 1,793,000 117,000 73,000 - 186,000 Exhibit A City of Lodi -- Wastewater Utility Financial Plan Summary Transfer Out (to 172 for past DS) Capital Projects Decommission Old Fleet Services Shop Lift Station Generator Repl. (Peterson Park) City -Wide IMF Program Update MSC Space Planning & Facil. Eval. Study WW Collect. Mstr. Plan (GP Expan. Areas) MSC Facility Rehab/Expansion Total Expenditures Ending Balance Owed Fund 170 for DS WW Rate Stabilization Fund (174) Beginning Balance Revenues Transfer In from 170 Total Revenues Expenditures Transfer Out to 170 Total Expenditures Ending Balance FY 08-09 FY 09-10 FY 10-11 - 379,000 844,000 7,436,000 - Actual Actual Estimate FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 5,930,000 372,758 - - - 5,059 - 100,000 - - 379,000 844,000 7,436,000 - 7,449,719 1,797,059 1,892,000 1,793,000 496,000 917,000 - 186,000 2,011,000 494,000 1,792,697 116,697 72,697 (503,303) 185,697 920,697 - - - 250,000 - 250,000 250,000 4,000 500,000 - 1,684,000 500,000 - 3,411,000 500,000 - 5,211,000 500,000 - 6,827,000 500,000 - - 250,000 250,000 - Rate Stabilization Fund - 250,000 500,000 500,000 500,000 500,000 500,000 500,000 Net Available for Capital Projects 4,636,000 4,304,629 - 250,000 500,000 500,000 500,000 500,000 500,000 500,000 Aggregate End -of -Year Balance 15,304,000 15,083,000 16,386,000 9,909,000 10,567,000 7,436,000 7,679,000 7,406,000 Operating Reserve (25%) 2,864,000 2,794,000 3,111,000 3,189,000 3,271,000 3,356,000 3,444,000 3,535,000 Restricted DS Reserve 2,170,000 2,476,087 2,332,103 2,332,103 2,270,732 2,270,732 2,270,732 2,270,732 2007 COP Proceeds 5,634,000 5,258,284 4,455,000 - - - - - Rate Stabilization Fund - 250,000 500,000 500,000 500,000 500,000 500,000 500,000 Net Available for Capital Projects 4,636,000 4,304,629 5,987,897 3,887,897 4,525,268 1,309,268 1,464,268 1,100,268 Exhibit B City of Lodi -- Wastewater Utility current ana Proposes wastewater nates Notes: (1) Winter water usage determined as average monthly usage from December through February. Current July 2011 Residential Percent Increase 5 Flat Rates ($/month) 1 Bedroom $ 23.30 $ 24.47 2 Bedroom $ 31.07 $ 32.62 3 Bedroom $ 38.84 $ 40.78 4 Bedroom $ 46.61 $ 48.93 5 Bedroom $ 54.37 $ 57.09 6 Bedroom $ 62.14 $ 65.24 7 Bedroom $ 69.91 $ 73.40 Usage -Based Rates Service Charge ($/month) $ 21.22 $ 22.28 Usage Charge ($/CCF) (1) $ 2.41 $ 2.53 Non -Residential ($/month) Moderate Strength (per SSU) $ 31.07 $ 32.62 High Strength Flow (per MG, annual basis) $ 3,145.95 $ 3,303.25 BOD (per 1,000 lbs, annual basis) $ 519.16 $ 545.12 SS (per 1,000 lbs, annual basis) $ 324.61 $ 340.84 Grease Interceptor & Septic Holding Tank Waste within City Limits (per 1,000 gal.) $ 274.89 $ 288.63 Septic (only) Holding Tank Waste Outside City Limits (per 1,000 gal.) $ 583.55 $ 612.73 Disposal to Storm Drain System (per MG) $ 288.74 $ 303.18 Notes: (1) Winter water usage determined as average monthly usage from December through February. RESOLUTION NO. 2011-81 A RESOLUTION OF THE LODI CITY COUNCIL SETTING WASTEWATER RATES FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL CUSTOMERS WHEREAS, Resolution No. 2009-100 approved wastewater rate increases of 25 percent effective July 2009; 20 percent effective July 2010; 10 percent effective July 2011; and five percent effective July 2012; and also approved an Engineering News Record - 20 Cities Average (ENR) based indexing of wastewater rates beginning with FY 2012/13. A Proposition 218 procedure was conducted that validated these actions; and WHEREAS, staff has regularly updated the Wastewater Utility Financial Plan with the assistance of the The Reed Consulting Group, Inc., of Sacramento, and the recommended rate adjustments in the Financial Plan are five percent beginning July 2011 and five percent beginning July 2012; and WHEREAS, the rates for current adjustment reflect a five percent increase that is substantially lower than the 10 percent increase approved by Council and includes an ENR -index adjustment of 3.60 percent. NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby approve usage -based and flat rat monthly wastewater rates as outlined on Exhibit A attached with the effective date of the increase to be July 1, 2011. Dated: May 18, 2011 -----------------.-.-.---.-.-.-.-.-.-.-.-.------------------------------- .................-.-.---.....-............................... hereby certify that Resolution No. 2011-81 was passed and adopted by the City Council of the City of Lodi in a regular meeting held May 18, 2011, by the following vote: AYES: COUNCIL MEMBERS - Hansen, Katzakian, and Mayor Johnson NOES: COUNCIL MEMBERS- Nakanishi ABSENT: COUNCIL MEMBERS - Mounce ABSTAIN: COUNCIL MEMBERS- None IJOHL City Clerk 2011-81 Exhibit A City cf Lodi -- Wastewater Utility Residential Percent Increase 5 Flat Rates ($/month) 1 Bedroom $ 23.30 $ 24.47 2 Bedroom $ 31.07 $ 32.62 3 Bedroom $ 38.84 $ 40.78 4 Bedroom $ 46.61 $ 48.93 5 Bedroom $ 54.37 $ 57.09 6 Bedroom $ 62.14 $ 65.24 7 Bedroom $ 69.91 $ 73.40 Usage -Based Rates Service Charge ($/month) $ 21.22 $ 22.28 Usage Charge ($/CCF) (1) $ 2.41 $ 2.53 Non -Residential ($/month) Moderate Strength (per SSU) $ 31.07 $ 32.62 High Strength Flow (per MG, annual basis) $ 3,145.95 $ 3,303.25 BOD (per 1,000 lbs, annual basis) $ 519.16 $ 545.12 SS (per 1,000lbs, annual basis) $ 324.61 $ 340.84 Grease interceptor & Septic HoldingTank Waste within City Limits (per 1,000gal.) $ 274.89 $ 288.63 Septic (only) HoldingTank Waste Outside City Limits (per 1,000 gal.) $ 583.55 $ 612.73 Disposal to Storm Drain System (per MG) $ 288.74 $ 303.18 Notes: (1) Winter water usage determined as average monthly usage from December through February. Engineering fi� Setting Wastewater Rates Agenda Item G-02 Background • May 19, 2009 — Adopted Series of Adjustments • Conducted Proposition 218 Hearing • Consolidated All Rate Components • ENR Based Indexing Rate Adjustments • July 16, 2009 17, 17, July 1, 2010 July 1, 2011 25% 12% 5% Includes ENR Adjustment of 3.6% July 1, 2012 5% Planned Major Expenditures • Wastewater Pipe Lining ($2,000,000) • White Slough Compliance Studies ($400,000) • White Slough Solids Handling ($4,500,000) • White Slough Debt Service ($4,117,000) Fund Highlights • Debt Service Coverage — 1.62 • Operating Reserve — 25% • Rate Stabilization Fund - $500,000 • IMF Reserves Depleted 2 Bedroom 3 Bedroom 4 Bedroom Comparative Rates Current $31.07 $38.84 $46.61 Julv 2011 $32.62 $40.78 $48.93 MaaNaaa Dilps'st-le Please immediately confirm receipt of this fax by calling 333-6702 CITY OF LODI P.O. BOX 3006 LODI, CALIFORNIA 95241-1910 ADVERTISING INSTRUCTIONS SUBJECT: PUBLIC HEARING TO CONSIDER RESOLUTION SETTING WASTEWATER RATES FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL CUSTOMERS PUBLISH DATE: SATURDAY, APRIL 9,2011 TEAR SHEETS WANTED: One (1) please SEND AFFIDAVIT AND BILL TO: LNS ACCT. #0510052 DATED: THURSDAY, APRIL 7,201 1 ORDERED BY: RANDI JOHL CITY CLERK JOINIFER IW ROBISON, CMC ASSISTANT CITY CLERK RANDI JOHL, CITY CLERK City of Lodi P. O Box 3006 Lodi, CA 95241-1910 MARIA BECERRA ADMINISTRATIVE CLERK Fazed to the Sentinel 'at 369=1084 at (time) on (nate) (pages) LNS - ; ,F..4v Phoned to,confirm receipt.of all pages,.at,.:_.,... (time).,.,., ';.,`GF _MB. MR: (initials)_, y forms\advins.doc DECLARATION OF POSTING PUBLIC HEARING TO CONSIDER RESOLUTION SETTING WASTEWATER RATES FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL CUSTOMERS On Thursday, April 7, 2011, in the City of Lodi, San Joaquin County, California, a Notice of Public Hearing to consider resolution setting wastewater rates for residential, commercial, and industrial customers (attached and marked as Exhibit A) was posted at the following locations: Lodi Public Library Lodi City Clerk's Office Lodi City Hall Lobby Lodi Carnegie Forum declare under penalty of perjury that the foregoing is true and correct. Executed on April 7, 2011, at Lodi, California. 00,4J A I 1 01. fSS—NIFERW. ROBISON. CMC ISTANT CITY CLERK N:\Administration\CLERK\Forms\DECPOSTPW.DOC ORDERED BY: RANDIJOHL CITY CLERK MARIA BECERRA ADMINISTRATIVE CLERK • CITY OF LODI Carnegie Forum 305 West Pine Street, Lodi NOTICE OF PUBLIC HEARING Date: May 18, 2011 Time: 7:00 p.m. For information regarding this notice please contact: Rand! Johl City Clerk i t Telephone: (209) 333-6702 NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that on Wednesday, May 18, 2011, at the hour of 7:00 p.m., or as soon thereafter as the matter may be heard, the City Council will conduct a public hearing at the Carnegie Forum, 305 West Pine Street, Lodi, to consider the following matter: a) Resolution setting wastewater rates for residential, commercial, and industrial customers (as identified on the attached ExhibitA). Information regarding this item may be obtained in the Public Works Department, 221 West Pine Street, Lodi, (209) 333-6706. All interested persons are invited to present their views and comments on this matter. Written statements may be filed with the City Clerk, City Hall, 221 W. Pine Street, 2nd Floor, Lodi, 95240, at any time prior to the hearing scheduled herein, and oral statements may be made at said hearing. F you challenge the subject matter in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice or in written correspondence delivered to the City Clerk at, or prior to, the public hearing. By Order of the Lodi City Council: Indi Johl ity Clerk Dated: April 6, 2011 D. Stephen Schwabauer City Attorney JACITYURKTORMSTH NOTICEpublicalion WWRates.doc 416111 EX H iBj i T A City of Lodi --Wastewater Utility current ana Nr000sea wastewater Kates Notes: (1) Winter water usage determined as average monthly usage from Decemberthrough February. Current July 2011 Residential Percent Increase 5 Flat Rates ($/month) 1 Bedroom $ 23.30 $ 24.47 2 Bedroom $ 31.07 $ 32.62 3 Bedroom $ 38.84 $ 40.78 4 Bedroom $ 46.61 $ 48.93 5 Bedroom $ 54.37 $ 57.09 6 Bedroom $ 62.14 $ 65.24 7 Bedroom $ 69.91 $ 73.40 Usage -Based Rates Service Charge ($/month) $ 21.22 $ 22.28 Usage Charge($/CCF) (1) $ 2.41 $ 2.53 Non -Residential ($/month) Moderate Strength (per SSU) $ 31.07 $ 32.62 High Strength Flow (per MG, annual basis) $ 3,145.95 $ 3,303.25 BOD (per 1,OOOlbs, annual basis) $ 519.16 $ 545.12 SS (per 1,OOOlbs, annual basis) $ 324.61 $ 340.84 Grease Interceptor & Septic Holding Tank Waste within City Limits (per 1,O00gal.) $ 274.89 $ 288.63 Septic (only) HoldingTank Waste Outside City Limits (per 1,000 gal.) $ 583.55 $ 612.73 Disposal to Storm Drain System (per MG) S 288.74 $ 303.18 Notes: (1) Winter water usage determined as average monthly usage from Decemberthrough February.