HomeMy WebLinkAboutAgenda Report - October 20, 2010 J-02AGENDA ITEM T410'*L
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
MEETING DATE: October 20,2010
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Approve water meter cost, extended payment and payment deferral
plan.
BACKGROUND INFORMATION: Staff is recommending the property owner water meter cost be
capped at $300 and the following information presents the basis for
this recommendation. At its March 17, 2010 meeting, Council
approved Alternative 5 for implementation of the Water Meter
Program, as described in the copy of that Council Communication provided in Exhibit A. That action by
Council approved property owner charges for five classes of meter installation types ranging from $300 to
$1,200; two optional payment plans, one-time or over seven years (with interest); and a five-year
construction time frame.
At its July 21, 2010 meeting, the City Council adopted a 2.00 percent inflationary increase to the usage -
based and flat water rates for residential customers effective January 1, 2011, set the Engineering News
Record — 20 Cities Average Construction Cost Index (ENR) as the basis for future rate indexing, and
eliminated the "Infrastructure" and "PCE/TCE" line items on the water utility bills.
The Water System Financial Strategy (Reed Group, Inc., 2010) for operation of the water utility,
construction of the Surface Water Treatment Facilities (SWTF), and operation of the SWTF was
approved by the City Council on October 6,2010 as part of the water revenue bonds issuance. The
details of the financial strategy are presented in Exhibit B that also includes the details of the PCETTCE
remediation program and the Water Meter Program (WMP). The PCE/TCE information is presented on
lines 98 through 115. As previously reported to Council, the level of effort and cost attributed to the
remediation program are now considerably less than previously assumed, as reflected on lines 107 and
108 of Exhibit B. As a result, the current PCE/TCE restricted reserves of $18 million are shown to be
sufficient to fund the anticipated remediation program for the next 10 years with a restricted reserves
balance of $6 million at the end of Fiscal Year 2019/20.
The WMP information is provided on lines 43, 47, and 48. The Water Utility, at the end of FY 2019/20, is
projected to have a fund balance of $17.7 million, the sum of lines 29, 64, and 80.
In consideration of the lower costs for the SWTF and the PCE/TCE remediation program, staff has
performed additional analyses for the Water Meter Program (WMP) that consider capping property owner
meter payments at $300 per residential parcel. Three new alternatives (6, 7 and 8) are described, below
with an analysis based upon the model information presented in Exhibit B. These new alternatives add to
the five alternatives presented in Exhibit A, the Council Communication from the March 17, 2010 Council
meeting. Results of the analysis are presented near the end of this Council Communication.
APPROVED:
Ko artlam, Interim City Manager
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Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
October 20, 2010
Page 2
Alternative 6. Five-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and a $300 cap on meter charges.
Alternative 7. Six-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and a $300 cap on meter charges.
Alternative 8. Seven-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and a $300 cap on meter charges.
Recommended Plan —Alternative 8
A. Seven-year construction schedule beginning 2011 and ending 2017
B. Cap meter cost at $300 per parcel
C. Optional lump sum paymentfor property owners from April 1, 2011 through June 30, 2011
D. Three-year monthly installment payments begin on July 1, 2011
E. Payment assistance program for very low- and low-income property owners
Water Meter Program. Extraordinary efforts have been expended to clarify and quantify the details of the
WMP. This included parcel -by -parcel investigations of existing conditions, correlation of county and City
parcel, address, ownership, occupancy and structure type for the approximately 13,000 residential parcels
within the WMP. Exhibit C presents a summary of the WMP data with emphasis added (bold) on the
number of parcels (10,117) benefitting from capping the meter charge at $300 per parcel.
Prepaid Meters. As reported to the City Council, all prepaid water meters for homes constructed since 1992
have been installed, the water meters are being read, and comparative water bills are being sent.
Usage -based water bills for these homes will be sent beginning January 1, 2011. However, there have
been approximately 250 property owners that have paid more than $300 for their water meter that resulted
from issuance of a billing permit exceeding the preset construction value threshold. Those payments
ranged from $325 to $540. Staff recommends refunds for the overpayment be issued upon request from the
property owner that paid the meter charge. The total of potential refunds is approximately $7,000.
Construction Phasing. The phasing plan for the WMP was purposely designed to install the greatest
number of meters at the lowest possible cost in the first phases with each successive phase increasing in
complexity, pre -design field investigation effort and cost. The data presented in Exhibit C demonstrates this
phasing strategy with the majority of Class D (rear yard service remains) and Class E (rear yard service
moves to front) occurring in Phases 2 through 5 of the WMP. The phasing plan diagram is presented in
Exhibit D. Considering the pipeline miles to be constructed, the construction season lasting from April
through November, and the construction -related disruption to the City's neighborhoods, staff is
recommending a seven-year construction program from 2011 through 2017. This would reduce the pipeline
reconstruction work to about 4.1 miles and meter installation to about 1,500 per construction season. The
longer duration program avoids the need for a rate increase to fund the WMP.
Set Costs for Five Installation Classes. In prior presentations to City Council, five installation classes were
identified and the property owner meter charge ranged from $300 to $1,200. Staff recommendsthat the
City Council approve a fixed -cost of $300 per parcel covering all classes to be charged to the property
owner.
Lump Sum Payments. Canvassing of the 12,924 residential meter installation locationswill be completed
by April 1, 2011. At that time, notices will be sent to property owners informing them of their installation
cost of $300. There will be a 60 -day property owner review period and lump sum payments would be
accepted through June 30, 2011.
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Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
October 20, 2010
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Pavment Installments. Payment installments in the amount of $8.53 per month will be approximately half
of the previous monthly cost for Class C and D ($13.80) and Class E ($15.00). The monthly charge would
be added to the customers' billing (if the property owner) or sent separately to the property owner of a
rental unit and this would begin July 1, 2011 and continue for three years. The interest rate charged will be
the Local Agency Investment Fund rate plus one percent which will total approximately 1.5 percent.
Initiating the payment installments at a uniform time and early in the Water Meter Program has a positive
impact on the cash flow for the Water Utility. Early payoff of the installments will be allowed. Conversion of
a lump sum payment to a payment installment program will not be allowed. Upon transfer or sale of the
property, early payoff of the installments will be required upon filing notice of service termination.
Pavment Assistance Program for Very Low- and Low -Income Property Owners. Staff continues to
recommend the designation of Community Development Block Grant (CDBG) funds to provide grants to
qualified very low- and low-income property owners. Lowering the meter charge to $300 will expand the
potential coverage of the CDBG funds. Applications for assistance will be solicited in every year of the
WMP.
Analvses Results. Results of the three additional alternatives are presented in the three graphs included
in Exhibit E and are described below. The important element of each graph is the fund balance line that
in each alternative reaches a low point around FY 2014/15.
Alternative 6. Five-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and $300 cap on meter charges — fund deficit occurs over a four-year period (FY 2013/14
through FY 2017/18) with the peak reaching negative $5.0 million. Water Utilityfund balance at the end of
FY 2019/20 is positive $7.7 million. Phases 4 and 5 of this alternative will create significant disruption within
the areas and management of the construction projects in those two years will be problematic.
Alternative 7. Six-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and $300 cap on meter charges — fund deficit occurs over a two-year period (FY 2014/15
through FY 2016/17) with the peak reaching negative $1.9 million. Water Utilityfund balance at the end
of FY2019/20 is positive $7.6 million. The construction effort of Phases 4, 5, and 6 will be similar to that
of Phases 2 and 3. Considerable disruption to the local community is expected during the last three
phases due to the higher residential density in these areas. Management of these construction projects
is not expected to be problematic.
Alternative 8. Seven-year construction, three-year extended payment plan, payment installments begin
July 1, 2011, and $300 cap on meter charges —fund balance reaches a minimum of positive $500,000 in
FY 2017/18 and the Water Utilityfund balance at the end of FY2019/20 is positive $7.6 million. This
option is similar but less disruptive and more easily managed than Alternative 7.
Alternative 8 is recommended due to the reduction in pipeline replacement each year to 4.1 miles, the
compatibility with construction season lasting from April through November, and the decreased disruption to
the City's neighborhoods. This alternative would also benefit cash flow for the Water Utility capital funds.
Payment Responsibility. As the City implements the WMP, a number of issues have been presented
requiring the application and interpretation of design standards and department policies. Several are
presented below for the City Council's information, comment and direction, as appropriate.
1. Multiple Services to Single -Family Detached Home —City policy designates that not more than one
water service be provided to a parcel with a single-family detached home. In past infrastructure
replacement projects and in the WMP, water services in excess of one will be removed and
K:\WP\PROJECTS\WATER\Meters\CWaterMeterProgram10-20-10.doc 10/1312010
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October 20, 2010
Page 4
abandoned. This commonly requires some onsite plumbing work to be performed that is the
obligation of the City.
2. Single Service to Multiple Single -Family Detached Homes — City policy designates that a unique
water service is requiredfor every parcel. This condition has been encountered at locationswhere a
lot split has occurred but additional water services were not required by the City. The property
owner will be assessed a meter charge for each parcel and new water services to be installed. This
commonly requires some onsite plumbing work to be performed that is the obligation of the City.
Construction of the new water service on private property and/or across private property is permitted
under the assumption the City has prescriptive access rights.
3. Service Extensions on Private Property —Almost half of the water service installations involve
construction of a new service in the property owners' front yards. Construction of the new water
service on private property is permitted underthe assumptionthe City has prescriptive access rights.
4. Multiple Services to a Single Parcel (Duplex, Triplex, and Four-plex Only) — An exception to the
policy of one water service per parcel will be made if the property owner pays the full additional cost
of installing the service(s), including trenching, tapping the main, paying for all materials, and
installing the service (including backflow prevention device) from the main to the dwelling unit.
Public Works Administrative Policy 33 (Fee and Service Charge Schedule) sets this charge at
$5,254 for the tap service installation to the property line with the onsite plumbing the obligation of
the property owner. This exception is made due to numerous comments from property owners not
wanting to take on the water and wastewater utility cost that currently lies with their tenants.
Alternatives available to these property owners include privately sub -metering the units or accepting
the water and wastewater utility cost. These additional water meters will have encoder receiver
transmitter (ERT) units that will be read along with the electric meters. Dwelling units in these
categories (duplex, triplex, and four-plex) must demonstrate that the water piping to all units is
completely isolated and backflow prevention devices will be required on each of the multiple
services.
5. Responsible Partyfor Monthly Usage -Based Water Bill — In all cases where a single water service to
a parcel exists, the property ownerwill be responsiblefor the usage -based water bill. There are two
exceptions. One, the tenant of a single-family detached home may apply to be responsiblefor the
water bill. And two, the tenant of a duplex, triplex, or four-plex may apply to be responsiblefor the
water bill only if there is an individual water service to his or her unit. The City Attorney has
determined the City may issue a usage -based water bill to the property owners of rented units in
these categories without formal application by the property owner.
City Council is requested to approve a plan setting water meter costs, the extended payment option and
payment deferral as recommended by staff or modified by the City Council.
FISCAL IMPACT: Not applicable.
FUNDING AVAILABLE: Not applicable.
F. Wally 919ndelin
Public Works Director
FWS/pmf
Attachments
K:\WP\PROJECTS\WATER\Meters\CWaterMeterProgram10-20.10.doc 10/14/2010
Exhibit A
AGENDA ITEM ,3' Z
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
MEETING DATE: March 17, 2010
PREPARED BY: PublicWorks Director
RECOMMENDED ACTION: Approve water meter cost, extended payment and payment deferral
plan.
BACKGROUND INFORMATION: At the March 2,2010 Shirtsleeve meeting, the City Council was
presented a number of alternative construction schedule, payment,
and payment deferral options. The City Council requested
additional information be provided relative to extending the
construction timeframe by two years and extending the payment deferral timeframe by one or two years.
Additionally, the City Council expressed interest in a $1,200 cap for property owners for installing new
meter services and that information also be provided relative to using Community Development Block
Grant (CDBG) funds for grants to very low- and low-income property owners.
Staff has performed these additional analyses, and the results are reported below. Based upon staffs
review of the results, the following Water Meter Program construction schedule and property owner payment
plan is recommended for approval by the City Council. The final City Council action setting usage -based
water rates, water meter costs, extended payment option, and payment deferral plan will occur at the close
of the Public Hearing scheduled for July 21, 2010.
Recommended Plan
A. Five-year construction schedule beginning 201 1 and ending 2015.
B. Set cost now for five classes of meter service installations. Costs would be set as follows:
1. Meter and electronic radio transmitter [ERT] ($300)
2. Meter and ERT installed in an existing nonstandard box ($450)
3. Replace Rich Box assembly in rear yard ($1,200)
4. Replace Rich Box assembly in front yard ($1,100)
5. Install new service and meter assembly from new water main to residence ($1,200)
C. Optional lump sum payment by property owners or seven-year payment installment plan (fixed
interest rate at City's Investment Portfolio rate — around 1.5 percent).
D. Lump sum payment period from April 1, 201 1through June 30, 2011.
E. Payment installments begin for all property owners on July 1, 2011.
F. Payment assistance program for very low- and low-income property owners.
Five -Year Construction Schedule. The Water Meter Program combines the replacement of 22.5 miles of
substandard water transmission mains with the installation of approximately 13,306water meters. The
estimated total cost of construction is $37,000,000 including design, construction administration,
inspection and construction. Funding for construction is coming from infrastructure replacement revenue
and water meter charges. Construction will be divided into five approximately equal phases sequenced
APPROVED: `�
Blair KingLity Manager
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Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
March 17, 2010
Page 2
across the community in a northwest to southwest direction. Construction activities will occur from April
through October in each year 2011 though 2015.
Previously, a three-year construction timeframe has been at the forefront of discussions with the Council.
As presented below, the results of analyses demonstrate that the shortened construction schedule has a
negative impact on the cash flow of the Water Capital fund that is partly mitigated by extending the
construction timeframe to five years.
Optional Lump Sum or Payment Installments. ExhibitA provides a summary of cost by installation cost,
recommended property owner charge by class, and payment installments by class for varying time
periods. The six- and seven-year alternatives have been added at City Council's request. The total of all
payment installments for the seven-year option is also provided. At the Shirtsleeve meeting, five classes
of installation types were reviewed and a diagram of each is provided in Exhibit B. The installation costs
vary from $300 to $2,000 with an estimated 3,623 properties in the Class 5 category at a cost of $2,000
each. Results of the water model analysis capping the Class 5 cost at $1,200 are provided below.
Set Costs Now for Five Installation Classes. Staff recommends that the City Council approve a fixed -cost
schedule at the levels presented in ExhibitA for the Water Meter Program. This is a departure from
staffs prior recommendation that property owner meter costs be based upon actual construction bids.
The recommendation, if approved, will establish equity across all installation classes and simplify the
billing and collections process. It is consistentwith the methodology incorporated by other communities.
Lump Sum Payments. Canvassing of the 13,306 meter installation locations will be completed by
April 1 , 2011. By that time, notices will be sent to property owners informing them of their installation
class and cost. There will be a 60 -day property owner review period and lump sum paymentswould be
accepted through June 30,2011.
Pavment Installments. Payment installments as presented in ExhibitA will be added to the customers'
billing (if the property owner) or sent separately to the property owner beginning July 1, 2011 and continue
for seven years. Initiating the payment installments at a uniform time and early in the Water Meter
Program has a positive impact on the cash flow in the Water Capital fund. Provisions for early retirement
of the payment installments will be available. Conversion of a lump sum payment to a payment installment
program will not be available, Upon transfer or sale of the property, the payment installment plan will
terminate and the balance due will be required to be paid upon notice of service termination.
Payment Assistance Program for Very Low- and Low -Income Property Owners. Staff recommends
dedicating CDBG funds to provide grants to at least very low- and possibly low-income property owners
receiving a new meter service. The grant program would be initiated this year and grant applications will
need to be returned by December 31, 2010 so that property owner eligibility and coverage of the grant
program could be determined by the City Council. For example, if eligible grant applications from very
low and low income property owners amounted to $1,500,000 and the work was evenly distributed
across the community, the City Council would be asked to commit an average of $300,000 per year for
the next five years. On the other hand, if eligible grant applications amounted to $3,000,000 and no
additional CDBG were available, the City Council might consider funding only the very low-income
category and part or none of the low-income category. This decision would be presented to the Council
early in 2011 prior to the start of payment installments on July 1, 2011.
Analyses Results. Five different cash flow analyses have been prepared as described in Exhibit C. The
fifth alternative resulted from comments at the Shirtsleeve Session and is similar to Alternative 2 but with
a five-year construction timeframe. Embedded assumptions in these alternative analyses include:
1. 1 -percent rate indexing in the first year and 4 -percent rate indexing each of the following nine years.
K:\WP\PROJECTS\WATER\Meters\CWaterMeterFinancing.doc 311012010
Approve Water Meter Cost, Extended Payment and Payment Deferral Plan
March 17, 2010
Page 3
2. 30 percent of property owners in the Classes 1 and 2 pay lump sum.
3. 10 percent of property owners in Classes 3 through 5 pay lump sum.
4. Payment installments begin in the year of construction for Alternatives 1 through 4 and on
July 1, 2011 for Alternative 5.
5. Infrastructure replacement revenue is dedicated to the pipeline replacement (22.5 miles) portion
of the water meter program.
6. PCEITCE cleanup revenues are reserved.
Results of the five analyses are presented in bar chart form in Exhibit D. The results are described
below.
Alternative 1. Three-year construction, five-year extended payment plan, payment installments begin in
year of construction, and no cap on meter charges —fund deficit occurs over a three-year period with the
peak reaching minus $8.2 million but recoveringtwo years later.
Alternative 2. Three-year construction, five-year extended payment plan, payment installments begin in
year of construction, and $1,200 cap on meter charges —fund deficit occurs over a four-year period
(because the water fund is covering the difference between $2,000 and $1,200) with the peak reaching
minus $9.3 million and recovering three years later.
Alternative 3. Five-year construction, five-year extended payment plan, payment installments begin in
the year of construction, and no cap on meter charges —fund deficit occurs over a three-year period with
the peak reaching minus $4.5 million and recovery occurs a little more than a year later.
Alternative 4, Five-year construction, five-year extended payment plan, payment installments begin in
the year of construction, and $450 cap on meter charges —fund deficit occurs for five years reaching a
peak minus $9.8 million and recovery occurs four years later.
Alternative 5. Five-year construction, seven-year extended payment plan, payment installments begin
July 1, 2011, and $1,200 capon meter charges —fund deficit occurs for just over three years reaching a
peak of minus $6.5 million with recovery in just over two years.
Alternative 5 is recommended over Alternative 2 if the meter cost is capped because the deficit is smaller
with a quicker recovery. Alternative 3 is superior to Alternative 1 if the full meter cost is charged to the
property owners and minimizing the size and duration of the deficit is important. Alternative 4 is not
recommended unless the construction timeframe was extended to seven years or longer. For all
alternatives, fund balance in other sub -funds is sufficient to cover the short-term deficit and the addition
of CDBG funds to the program has not been accounted for in the analyses. At this time, staff is not
recommending any further exploration of alternative scenarios.
City Council is requested to approve a plan setting water meter costs, the extended payment option and
payment deferral as recommended by staff or modified by the City Council.
FISCAL IMPACT: Not applicable.
FUNDING AVAILABLE: Not applicable.
F. Wally S delin
PublicWorks Director
FWS/pmf
Attachments
K:\WPIPROJECTS\WATER\Meters\CWaterMeterFinancing,doc 3/10/2010
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The Reed Group, Inc. DRAFT-- 10/8/2010
A
C
D
E
F
G
H
2
Financial
Plan Summary
3
4
FY 09-10
Est. Actual
FY 10-11
Budget
FY 11-12
FY 12-13
FY 13-14
FY 14-15
FY 15-16
FY 16-17
FY 17-18
FY 18-19
FY 19-20
5
Overall Water Rate Increases-->
OPERATING FUND :•
Beginning Balance
Revenues
Water Sales
Interest Earnings
Other Revenues
Transfer from Fund 182 for DS
Total Revenues
Expenditures
Transfer Out to Gen'I Fund (COS)
Transfer Out to Wtr Cap Outlay
Transfer Out to PCE-TCE Fund
Personnel Services
Utilities, Commun., &Transport.
Supplies, Mat'Is., Services & Other
SWTF Oper. & Maint.(net)
Debt Service
1991 CSDW Loan Payments
Est. Net 2010 Rev. Bond Payments
Total Expenditures
Ending Balance
2,071,982
8,739,854
25,266
39,565
8,804,685
1,060,122
2,319,445
1,325,536
733,653
2,550,028
228,012
8,216,796
2,660,000
2.0%
Jan. 2011
3,300,906
11,796,000
14,540
325,000
12,135,540
1,060,120
3,000,000
1,403,580
721,150
2,600,910
1,433,395
1,305,592
11,524,747
3 911 699
3.5%
Jan. 2012
3,911,699
12,158,000
41,000
348,000
12,547,000
1,060,000
3,500,000
1,452,000
753,000
2,680,000
2 653 388
12,098,388
4,360,311
3.5%
Jan. 2013
4,360,311
12,609,000
55,000
265,000
215,000
13,144,000
1,060,000
4,000,000
1,488,000
787,000
2,680,000
1,822,000
2,652,750
14,489,750
3 014 561
3.5%
Jan. 2014
3,014,561
13,068,000
49,000
273,000
444,000
13,834,000
1,060,000
4,500,000
1,539,000
823,000
2,761,000
1,538,000
2 659 675
14,875,675
1,972,886
3.5%
Jan. 2015
1,972,886
13,552,000
25,000
281,000
459,000
14,317,000
1,060,000
5,600,000
1,592,000
860,000
2,843,000
1,590,000
2,655,788
16,200,788
89 098
3.5%
Jan. 2016
89,098
14,054,000
8,000
289,000
475,000
14,826,000
1,060,000
3,600,000
1,645,000
898,000
2,929,000
1,644,000
2 656 088
14,432,088
483,010
3.5%
Jan. 2017
483,010
14,575,000
57,000
297,000
492,000
15,421,000
1,060,000
2,000,000
1,702,000
938,000
3,016,000
1,700,000
2,652,725
13,068,725
2,835,285
3.5%
Jan. 2018
2,835,285
15,154,000
111,000
305,000
509,000
16,079,000
1,060,000
4,000,000
1,760,000
981,000
3,106,000
1,758,000
2 653 088
15,318,088
3 596 197
3.5%
Jan. 2019
3,596,197
15,715,000
134,000
314,000
527,000
16,690,000
1,060,000
4,500,000
1,820,000
1,025,000
3,200,000
1,818,000
2,651,963
16,074,963
4,211,234
3.5%
Jan.2020
4,211,234
16,296,000
162,000
323,000
545,000
17,326,000
1,060,000
4,500,000
1,883,000
1,071,000
3,297,000
1,880,000
2 654 350
16,345,350
5 191 884
8WATER
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Z5
26
27
29
30
Operating Reserve (25%)
Available Balance
DS Coverage
1,417,000
1,243,000
14.10
1,446,000
2,465,699
2.97
1,486,000
2,874,311
3.27
1,959,000
1,055,561
2.72
1,930,000
42,886
2.94
1,986,000
(1,896,902)
3.01
2,044,000
(1,560,990)
3.10
2,104,000
731,285
3.26
2,166,000
1,430,197
3.45
2,231,000
1,980,234
3.04
2,298,000
2,893,884
3.21
31
32
34WATER
CAPITAL OUTLAY
Beginning Balance
Revenues
Operating Transfers In
Interest Earnings
Retrofit Meter Install. Charge
Debt Proceeds
11,839,529
2,319,445
78,375
11,287,790
3,000,000
57,410
1,453,000
10,892,200
3,500,000
100,000
1,570,000
9,188,200
4,000,000
121,000
1,570,000
7,020,200
4,500,000
110,000
1,570,000
4,043,200
5,600,000
50,000
1,570,000
6,200
3,600,000
1,000
1,570,000
46,200
2,000,000
56,000
1,570,000
3,193,200
4,000,000
160,000
1,570,000
6,137,200
4,500,000
285,000
10,408,200
4,500,000
391,000
35
36
37
38
39
40
41
Total Revenues
Expenditures
Water Meter/Main Install. Project
Water Taps
Miscellaneous Water Mains
Commercial Meter Replacements
Valve Exercising Program
UWMP Update
Meter Fixed Network
MSC Paving
Vehicles/Equipment
Unspecified Capital Projects
2,397,820
2,932,000
4,510,410
4,073,000
75,000
50,000
10,000
20,000
50,000
500,000
75,000
53,000
5,170,000
6,694,000
78,000
52,000
10,000
21,000
19,000
5,691,000
7,662,000
80,000
54,000
5,000
21,000
37,000
6,180,000
8,947,000
83,000
55,000
6,000
22,000
44,000
7,220,000
11,039,000
86,000
57,000
6,000
23,000
46,000
5,171,000
4,846,000
89,000
59,000
6,000
24,000
59,000
48,000
3,626,000
92,000
61,000
6,000
25,000
49,000
246,000
5,730,000
95,000
64,000
6,000
25,000
51,000
2,545,000
4,785,000
99,000
66,000
7,000
26,000
53,000
263,000
4,891,000
102,000
68,000
7,000
27,000
55,000
2,726,000
42
43
44
45
46
47
52
53
54
55
56
58
60
Total Expenditures
2,932,000
4,906,000
6,874,000
7,859,000
9,157,000
11,257,000
5,131,000
479,000
2,786,000
514,000
2,985,000
Ending Balance 11,305,000 10,892,200 9,188,200 7,020,200 4,043,200 6,200 46,200 3,193,200 6,137,200 10,408,200
12,314,200
M
03
--i
03
The Reed Group, Inc. DRAFT-- 10/8/2010
The Reed Group, Inc. DRAFT-- 10/8/2010
K I
L I
tt
2
City of Lodi-- Water Utility
Financial Plan Surnmaly
WATER FACILITIES (182)
Beginning Balance
Revenues
Water Impact Mitigation Fees
Interest Earnings
Total Revenues
Expenditures
Well #27 - Pump, Motor & Site Impr.
MSC Rehab/Expansion
Transfer to Fund 180 for Debt Service
Total Expenditures
Ending Balance
Owec Fund 180 for DS
FY 09-10
Est- Achial
(442,341)
1,669
-
1,669
-
25,000
-
25,000
(466,000)
FY 10-11
-BlIdapt
(495,606)
271,480
-
271,480
250,000
-
-
250,000
(474,126)
870,000
FY -12
(474,126)
414,000
(5 1000)
409,000
-
-
-
-
(65,126)
2,639 000
,
IFY 12-13
(65,126)
429,000
(1,000)
428,000
-
-
215,000
215,000
147,874
4,193 000
,
FY 13-14
147,874
444,OOC
3,000
447,000
-
-
444,000
444,000
150,874
5,519,000
FY 14-15
150,874
459,000
4,000
463,000
-
_
459,000
459,000
154,874
6,831 000
,
FY 15-16
154,874
475,000
5,000
480,000
-
_
475,000
475,000
159,874
8,127 000
,
FY 16-17
159,874
492,000
6,000
498,000
_
_
492,000
492,000
165,874
9,403 000
,,
FY 17-1B
165,874
509,000
6,000
515,000
_
_
509,000
509,,000
171,874
10,663,000
FY ]B-99
171,874
527,000
6,000
533,000
_
_
527,000
527,,000
177,874
11 904 000
,
FY 1q -n
177,874
545,000
6,000
551,000
_
_
545,000
545,000
183,874
13 129 OOp
, ,
62IMF
63
64
65
66
67
68
70
171
72
74
76
77
78
93
94
Beginning Balance
Revenues
PCE-TCE Settlements
Transfer In from Fund 180
Transfer In from Fund 183
TranefPrTn frnm Fiind 1RS
Interest Earnings
(241,630)
-
15,742
3,757,575
-
Funding of PCE-TCE
18,025,488
1,200,000
-
83,000
Expenses
16,308,488
-
-
158,000
Assumed to Come
15,538,488
-
-
226,000
From 19x
14,755,488
-
269 OOC
Funds (excluded
12,432,488
-
_
277 nnn
from model)
10,031,488
-
2Ra nnn
9,332,488
-
ano nnn
8,626,488
_
_
284,000
7,865,488
_
256,000
7,044,48$
_
227 OOQ
95
96
97
98
99
100
101
Expen�itueresn❑es
PCE-TCE Remediation - Capital
PCE-TCE Remediation - O&M
Water PCE-TCE Legal
Transfer to Fund 183
Past Expenditures
Total Expenditures
3,773,317
-
250,000
100,000
-
350,000
1,283,000
2,300,000
700,000
3,000,000
158,000
104,000
824,000
928,000
226,000
107,000
902,000
1,009,000
269,00(
1,663,000
929,000
2,592,000
`
277,000
1,721,000
957,000
2,678,000
`
286,000
-
985,000
985,000
`
309,000
-
1,015,000
1,015,000
284,000
-
1,045,000
1,045,000
256,000
-
1,077,000
1,077,000
227,OOd
-
1,109,000
1,109,006-
102
103
104
105
106
107
109
110
111
Ending Balance
-3j82,000
16,308,488
15,538,488
14,755,488
12,432,488
10,031,488
9,332,488
8 626 488
7,865,488
7 044 488
6 62,488,
112
The Reed Group, Inc. DRAFT-- 10/8/2010
Exhibit C
10/08/2010 12:55 PM
Lodi Water Meter Program
Item
Units
Phase 1
Phase 2
Phase 3
Phase 4
Phase 5
TOTAL
Water Main
Install Water Pipeline
Feet
4,228
27,541
27,533
33,024
41,690
134,016
Miles
0.80
5.22
5.21 !
6.07
7.90
Meter installations
3,694
2,243
2;11,9
2,461-'
2,407`
12,924
Class A ($300)
Each
1,669
469
409
140
120
2,807
Class B ($450)
Each
634
170
113
70
70
1,057
Class C ($1100)
Each
1,181
570
679
369
274
3,073
Class D ($1200)
Each
109
226
304
1,157
595
2,391
Class E ($1200)
Each
101
808
614
725
I
1,348
3,596
E$T.IMATED'CAPITAC COST
=
$
5`201,000 '
1.
$ 7,3 f3 000
.
$ •, `7;046,000) $;
8,752;000
! ` $
10,199;000,
10/08/2010 12:55 PM
PHASE 4
45%
Illim
Im m 1 111- 1 hilm �
0
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
FY
$( 5,000,000)
0'(10,000,000)
EXHIBIT E: ALTERNATIVE 6
EXHIBIT E: ALTERNATIVE
EXHIBIT E: ALTERNATIVE 8
The City of Lodi
Public Works
Engineering
firr
■ ■ firs •
f ; _
F
Water Meter
Item J-02
October 20, 2010
s[e? Recommendation
M
■ $300 cap on residential customers
■ Reduction from $1,200 cap
• Pay in full April 1 — June 30, 2011
■ 3 -year installments ($8.53/month) beginning July
2011
■ Reduction from seven-year, $15/month max
■ Payment assistance for qualified property owners
■ 7 -year construction phasing
■ Extended from 5 years
■ Full City cost recovery on additional services
(estimated $1,000 to $6,000)
M
Historical Information
■ Post 1992 — Home price included cost of
service and meter (2,884 services)
■ Meters with building permit — 900 services
(250 paid more than $300)
■ City -installed boxes (1979 to date) and
Infrastructure Replacement Projects 1
through 3 (approximately 3,000 services)
■ All others — 9,060 services
M
Payment Installments
■ Three Year Plan - $8.53 per month
■ Five Year Pla
0
0
0
3.76
i.65
13-80
5.00
M
4 Favorable Factors
■ Low bid for Surface Water Treatment
Facilities
■ Low interest rate (4%)
■ Water Meter Program costs quantified
■ PCE/TCE remediation funded > 10 years
by settlement reserves
All
$20,000,000'
$18,000,000
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
Financial Analysis
Capital Program
Debt Service
Oper. & Maint. Cost
Total Revenues
FY 09-10 FY 10-11 FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20
Seven -Year Construction
M
Driving Factors
■ Construction season April through October
■ Infrastructure replacement (pipes) equal
across phases
■ Neighborhood disruption reduced
■ Construction administration effort balanced
■ No borrowing or additional rate increase
needed
Payment Responsibilities
M
■ Multiple services to asingle-family detached home will
be removed
■ City has right to install new services via easement
■ Multiple services allowed — full added cost paid by
property owner (duplex, triplex, fourplex)
■ Usage -based utility bill sent to all individually metered
single-family homes (tenants and owners)
■ Usage -based utility bill can be sent to owner without
formal application
Questions?
I