HomeMy WebLinkAboutAgenda Report - December 21, 2011 G-02 PHAGENDA ITEM
-1W
&"% CITY OF LODI
COUNCIL COMMUNICATION
AGENDA TITLE: Public Hearing to Consider Adopting Resolution Setting Pre -Approved Engineering
News Record Adjustment Index for Usage -Based and Flat Water Rates
MEETING DATE: December 21, 2011
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Public hearing to consider adopting resolution setting pre -approved
Engineering News Record adjustment index for usage -based and
flat water rates.
BACKGROUND INFORMATION: The City Council has made numerous water rate decisions over the
past few years, as summarized below. Staffs recommended action at
this time is to implement a rate increase of 2.2 percent effective
January 1, 2012, as presented in ExhibitA.
On May 20, 2009, Council waived the Consumer Price Index (CPI) adjustment of water rates based upon a
lack of new information supporting neither an increase nor a decrease. On January 6, 2010, Council received
advisory usage -based water rates for the purpose of research and customer billing comparisons. On
July 21, 2010, Council approved a change to the date for implementing the annual rate adjustment to
January 1 for each of the five years (maximum timeframe allowed by Proposition 218) following
January 1, 2011. This change was recommended so that rate changes occur at the lowest usage time of the
year. Council also changed the water rate adjustment index from the CPI to the ENR, effective
January 1, 2012, because this index better reflects the combined inflationary effects of personnel, materials
and energy costs on the total operations of the utility, as was done for the Wastewater Rates on July 15, 2010.
Council approved a professional services agreementwith The Reed Group on August 6, 2008, for the
preparation of a water utility financial model. The model will be used to forecast the performance of the
utility through FY 2019/20 while incorporating substantial capital investments, including the surface water
treatment facilities, water meter program, infrastructure replacement program, property owner meter
payments and PCE/TCE remediation costs. The recommended rates presented in ExhibitA were
developed using this tool.
While the ENR -based adjustmentfor the period October 2010 through October 2011 is 2.53 percent, the
model forecast works with an increase of just 2.2 percent, as was presented in the current copy recently
sent to Council. It is staffs recommendation that the water rate increase be 2.2 percent rather than the
actual ENR -based increase of 2.53 percent. For a resident still on the flat rate, the monthly charge for a
three-bedroom home will increase from $41.09 to $41.99. A metered resident using 1,500 cubic feet of
water per month will see an increase from $38.10 to $38.95.
FISCAL IMPACT: Increased revenues to the water utility are required to keep up with cost of
service increases and new mandated costs.
FUNDING AVAILABLE: Not applicable. I D
Prepared by RebeccaAreida-Yadav, ManagementAnalyst
FWS/RAY/pmf
Attachment
cc: Steve Mann, Information Systems Manager
APPROVED:
F. Wally Sa delin
Public Works Director
Charlie Swimley, Deputy Public Works Director—Utilities
Bartlam; City Manager
K:\WP\UTILITY RATES\W WW\2012 W Rate lncrease\CCPR WaterRates.doc 11/16/2011
Exhibit A
City of Lodi -- Water Utility
current and Proposed Water Rates
Metered Water Rates
Current (1)
.Ian. 2012
Flat Rates ($/month)
Service Charge ($/month)
Percent Increase
Single Family Residential (2)
2.2%
Single Family Residential Unit ($/month)
Up to 3/4" Meter
$
22.70
1 Bedroom
$
28.54
$
29.17
2 Bedroom
$
34.28
$
35.03
3 Bedroom
$
41.09
$
41.99
4 Bedroom
$
49.37
$
50.46
5 Bedroom
$
59.22
$
60.52
6 Bedroom
$
71.06
$
72.62
7 Bedroom
$
85.25
$
87.13
Multi -Family Residential Unit ($/month)
1 1/2" Meter
$
57.50
1 Bedroom
$
24.50
$
25.04
2 Bedroom
$
29.39
$
30.04
3 Bedroom
$
35.26
$
36.04
Metered Water Rates
Service Charge ($/month)
Single Family Residential (2)
Up to 3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
1 1/2" Meter
$
72.00
$
73.58
2" Meter
$
114.35
$
116.87
Multi -Family and Non -Residential (3)
5/8" Meter
$
22.70
$
23.20
3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
1 1/2" Meter
$
57.50
$
58.77
2" Meter
$
71.85
$
73.43
3" Meter
$
100.60
$
102.81
4" Meter
$
129.35
$
132.20
6" Meter
$
186.80
$
190.91
8" Meter
$
244.30
$
249.67
10" Meter
$
301.75
$
308.39
Water Usage Rates ($/CCF)
Single Family Residential (2)
Tier 1 - 0 to 10 CCF/month
$
0.88
$
0.90
Tier 2 - 11 to 50 CCF/month
$
1.32
$
1.35
Tier 3 - Over 50 CCF/month
$
1.74
$
1.78
Multi -Family and Non -Residential
All Water Usage
$
0.88
$
0.90
RESOLUTION NO. 2011-200
A RESOLUTION OF THE LODI CITY COUNCIL
SETTING PRE -APPROVED ENGINEERING NEWS
RECORD ADJUSTMENT INDEX FOR USAGE -BASED
AND FLAT RATE MONTHLY WATER RATES
WHEREAS, Resolution No. 2010-123 approved annual water rate increases in
an amount not to exceed the percentage change in the Engineering News Record (ENR)
Twenty Cities Annual Average Index beginning January 2012 through January 2016. A
Proposition 218 procedure was conducted that validated this action; and
WHEREAS, staff has regularly updated the Water Utility Financial Plan with the
assistance of the The Reed Consulting Group, Inc., of Sacramento; and
WHEREAS, the current water rate adjustment reflects 2.2 percent increase that
is lowerthan the actual ENR -based increase of 2.53 percent.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
set pre -approved Engineering News Record adjustment index for usage -based and flat
rate monthly water rates as outlined on Exhibit A attached with the effective date of the
increaseto be January 1,2012.
Dated: December 21, 2011
I hereby certify that Resolution No. 2011-200 was passed and adopted by the
City Council of the City of Lodi in a regular meeting held December 21, 2011, by the
following vote:
AYES: COUNCIL MEMBERS— Hansen, Katzakian, and Nakanishi
NOES: COUNCIL MEMBERS— Mayor Mounce
ABSENT: COUNCIL MEMBERS—Johnson
ABSTAIN: COUNCIL MEMBERS— None
2011-200
Exhibit A
City of Lodi-- Water Utility
Metered Water Rates
Current (1)
Jan. 2012
Flat Rates ($/month)
Service Charge ($/month)
Percent Increase
Single Family Residential (2)
2.2%
Single Family Residential Unit ($/month)
Up to 3/4" Meter
$
1 Bedroom
$
28.54
$
29.17
2 Bedroom
$
34.28
$
35.03
3 Bedroom
$
41.09
$
41.99
4 Bedroom
$
49.37
$
50.46
5 Bedroom
$
59.22
$
60.52
6 Bedroom
$
71.06
$
72.62
7 Bedroom
$
85.25
$
87.13
Multi -Family Residential Unit
($/month)
11/2" Meter
$
57.50
1 Bedroom
$
24.50
$
25.04
2 Bedroom
$
29.39
$
30.04
3 Bedroom
$
35.26
$
36.04
Metered Water Rates
Service Charge ($/month)
Single Family Residential (2)
Up to 3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
11/2" Meter
$
72.00
$
73.58
2" Meter
$
114.35
$
116.87
Multi -Family and Non-Residential(3)
5/8" Meter
$
22.70
$
23.20
3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
11/2" Meter
$
57.50
$
58.77
2" Meter
$
71.85
$
73.43
3" Meter
$
100.60
$
102.81
4" Meter
$
129.35
$
132.20
6" Meter
$
186.80
$
190.91
8" Meter
$
244.30
$
249.67
10" Meter
$
301.75
$
308.39
Water Usage Rates ($/CCF)
Single Family Residential (2)
Tier 1- 0 to 10 CCF/month
$
0.88
$
0.90
Tier 2 - 11 to 50 CCF/month
$
1.32
$
1.35
Tier 3 - Over 50 CCF/month
$
1.74
$
1.78
Multi -Family and Non -Residential
All Water Usage
$
0.88
$
0.90
r
44
The City of Lodi
Public Works
Engineering
Public Hearing
Water Rates
Agenda Item G - 2
December 21, 2011
JO Water Rate Setting
N
•July 2010 Council Adopted 5 -Year Schedule of
Rate Adjustments
• ENR Index Established (No More CPI)
• Proposition 218 Procedure Affirmed Schedule
• Financial Model Used to Analyze Rate Changes
N
Recommendation
• January 2011 Increase - 2.0%
• Proposition 218 Anticipated Increase - 3.5%
• ENR 2011 Index Change — 2.53%
N
14A Metered Water Rates
Fixed Monthly Service Charge:
Metered charges:
— Tier 1 (Up to 7,480 gals/month)
—Tier 2 (7,480-37,400 gals/month)
— Tier 3 (>37,400 gals/month)
$23.20
$0.0012/gal
$0.0018/gal
$0.0023/gal
Questions?
I
Please immediately confirm receipt
& this fax by calling 333-6702
CITY OF LODI
P. O. BOX 3006
LODI, CALIFORNIA 95241-19 10
ADVERTISING INSTRUCTIONS
SUBJECT: PUBLIC HEARING TO CONSIDER RESOLUTION SETTING PRE -
APPROVED ENGINEERING NEWS RECORD ADJUSTMENT
INDEX FOR USAGE-BASEDAND FLAT WATER RATES
PUBLISH DATE: SATURDAY, NOVEMBER 19,2011
TEAR SHEETS WANTED: One (11 please
SEND AFFIDAVIT AND BILL TO: RANDI JOHL, CITY CLERK
LNS ACCT. #0510052 City of Lodi
P.O. Box 3006
Lodi, CA 95241-1910
DATED: THURSDAY, NOVEMBER 17,2011
ORDERED BY: RANDI JOHL
CITY CLERK
NIFER M. ROBISON, CMC MARIA BECERRA
SSISTANT CITY CLERK ADMINISTRATIVE CLERK
Verify Appearance of this Legal in the Newspaper — Copy to File
formAadvins.doc
� <0
�/FORS
DECLARATION OF POSTING
PUBLIC HEARING TO CONSIDER RESOLUTION SETTING PRE -APPROVED
ENGINEERING NEWS RECORD ADJUSTMENT INDEX FOR USAGE -BASED
AND FLAT WATER RATES
On Thursday, November 17, 2011, in the City of Lodi, San Joaquin County, California, a
Notice of Public Hearing to consider resolution setting pre -approved Engineering News
Record adjustment index for usage -based and flat water rates (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 November 17, 2011, at Lodi, California.
,INIFER P. ROBISON, CMC
ASSISTANT CITY CLERK
N:\/Administration\CLERK\Forms\DECPOSTPW.DOC
ORDERED BY:
RANDIJOHL
CITY CLERK
MARIABECERRA
ADMINISTRATIVE CLERK
• CITY OF LODI
Carnegie Forum
305 West Pine Street, Lodi
NOTICE OF PUBLIC HEARING
Date: December 21,2011
Time: 7:00 p.m.
For information regarding this notice please contact:
Randi Johl
City Clerk
Telephone: (209) 333-6702
NOTICE OF PUBLIC HEARING
E ii ri.t Mib 1 i A]
NOTICE IS HEREBY GIVEN that on Wednesday, December 21, 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 pre -approved Engineering News Record
adjustment index for usage -based and flat water rates (as identified
on the attached Exhibit A).
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.
If 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.
13�y�er of, the Lodi City Council:
4�� ri
City Clerk
Dated: November 16,2011
ApDroved as to form:
D. Stephen Sdwvabauer
City Attorney
J1CITYCLRMFORMS\PH NOTICE publicatimWaterRates.doc 11115111
Exhibit A
City of Lodi-- Water Utility
current and Proposed Water Rates
Metered Water Rates
Current (1)
Jan. 2012
Flat Rates ($/month)
Service Charge ($/month)
Percent Increase
Single Family Residential (2)
2.2%
Single Family Residential Unit ($/month)
Up to 3/4" Meter
$
22.70
1 Bedroom
$
28.54
$
29.17
2 Bedroom
$
34.28
$
35.03
3 Bedroom
$
41.09
$
41.99
4 Bedroom
$
49.37
$
50.46
5 Bedroom
$
59.22
$
60.52
6 Bedroom
$
71.06
$
72.62
7 Bedroom
$
85.25
$
87.13
Multi -Family Residential Unit ($/month)
11/2" Meter
$
57.50
1 Bedroom
$
24.50
$
25.04
2 Bedroom
$
29.39
$
30.04
3 Bedroom
$
35.26
$
36.04
Metered Water Rates
Service Charge ($/month)
Single Family Residential (2)
Up to 3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
11/2" Meter
$
72.00
$
73.58
2" Meter
$
114.35
$
116.87
Multi -Family and Non -Residential (3)
5/8" Meter
$
22.70
$
23.20
3/4" Meter
$
22.70
$
23.20
1" Meter
$
36.85
$
37.66
11/2" Meter
$
57.50
$
58.77
2" Meter
$
71.85
$
73.43
3" Meter
$
100.60
$
102.81
4" Meter
$
129.35
$
132.20
6" Meter
$
186.80
$
190.91
8" Meter
$
244.30
$
249.67
10" Meter
$
301.75
$
308.39
Water Usage Rates ($/CCF)
Single Family Residential (2)
Tier 1- 0 to 10 CCF/month
$
0.88
$
0.90
Tier 2 - 11 to 50 CCF/month
$
1.32
$
1.35
Tier 3 - Over 50 CCF/month
$
1.74
$
1.78
Multi -Family and Non -Residential
All Water Usage
$
0.88
$
0.90