HomeMy WebLinkAboutMinutes - December 10, 2013 SSLODI CITY COUNCIL
SHIRTSLEEVE SESSION
CARNEGIE FORUM, 305 WEST PINE STREET
TUESDAY, DECEMBER 10, 2013
A. Roll Call by City Clerk
An Informal Informational Meeting ("Shirtsleeve" Session) of the Lodi City Council was held
Tuesday, December 10, 2013, commencing at 7:00 a.m.
Present: Council Member Mounce, Council Member Nakanishi, Mayor Pro Tempore Hansen,
and Mayor Katzakian
Absent: Council Member Johnson
Also Present: City Manager Bartlam, City Attorney Schwabauer, and City Clerk Johl-Olson
B. Topic(s)
B-1 Receive Information Regarding Metering Options to Mobile Home Parks (PW)
Public Works Director Wally Sandelin provided a PowerPoint presentation regarding mobile home
parks metering. Specific topics of discussion included state law, public outreach efforts, general
mobile home park information in the City, survey results, master meter justification, average
monthly water and wastewater charges, total monthly savings, City and owner implementation,
and owner preferred alternatives.
In response to Council Member Mounce, Mr. Sandelin stated specific rental amounts were not a
part of the survey.
In response to Council Member Mounce, City Attorney Schwabauer stated that, while the Public
Utilities Commission (PUC) does not regulate submetering, there are other State laws that
regulate the amount a property owner may charge a tenant for utility services provided through
submetering.
In response to Council Member Nakanishi, Mr. Sandelin stated park owners would need to pay
for submetering although they do have the option to pass down the cost to the tenants over a
period of time.
In response to Council Member Mounce, City Manager Bartlam stated under a master meter
justification, if the costs were divided equally amongst all tenants based on space alone, the rates
would go down, although it is the property owner's decision as to how to divide the costs.
In response to Mayor Pro Tempore Hansen, Mr. Sandelin stated the master meters were installed
in 2012, they have been in place over a year, collected data shows how much total water was
being used, and that data is the basis for the calculations presented to the City Council.
Mr. Sandelin stated with the master meter scenario tenants would pay the property owner directly
for the utility service along with their rent.
In response to Council Member Mounce, Mr. Schwabauer stated property owners do have an
ability to recover costs from tenants for administering the billing of the utility service.
In response to Mayor Katzakian, Mr. Sandelin reviewed the rate formulas under the current rate
structure and specifically discussed commodity costs.
In response to Mayor Pro Tempore Hansen, Mr. Schwabauer briefly discussed the ability to
regulate unfair rent practices and increases through various agencies charged with that
responsibility.
In response to Mayor Pro Tempore Hansen, Mr. Sandelin stated that, while property owners
would continue to pay the City directly, tenants would need to pay the property owner instead of
the City because the tenant would no longer be a customer receiving utility billing from the City.
In response to Council Member Mounce, Mr. Bartlam stated that, while there may be an ability to
allow the tenant to pay the City directly, it is not the preferred alternative because, unlike the
property owner, the City does not have an enforcement mechanism to force payment or an ability
to shut-off service when a tenant fails to pay.
In response to Mayor Pro Tempore Hansen, Mr. Sandelin confirmed that the City recovery for the
utility service will decrease by approximately $100,000 through the master meter system for
mobile home parks but according to the data it is better aligned with the cost of providing the
service.
In response to Mayor Pro Tempore Hansen and Council Member Mounce, Mr. Schwabauer
provided a brief overview of the shut-off process for non-payment of City utilities, including
electric and water services, and the differences and similarities of the same.
In response to Mayor Pro Tempore Hansen, Mr. Sandelin confirmed that property owners have
been engaged in the public meetings regarding this topic.
In response to Mayor Katzakian, Mr. Sandelin confirmed that wastewater is adjusted annually on
July 1.
In response to Council Member Nakanishi, Mr. Bartlam stated the idea of providing a credit to
property owners involves the amount of additional work it may take for a property owner to bill his
tenants. Mr. Bartlam stated a calculation divided equally among the number of spaces would not
take much time but a calculation based on actual use of each space through an individual meter
would take more time.
In response to Council Member Nakanishi, Deputy City Manager Jordan Ayers stated the base
charge, without late fees, for non-payment is $28,000 annually. Mr. Bartlam stated mobile home
park owners will not experience this loss because they have recourse whereas the City does
not.
In response to Council Member Nakanishi, Mr. Sandelin stated based on his research there are
no mobile home parks in the State that have utility -owned individual water meters in the parks
and they all operate through master meters. Mr. Sandelin stated in San Diego there are
submetering requirements but developers and property owners pay for the meters.
In response to Council Member Mounce, Mr. Bartlam confirmed that mobile home park owners
previously paid for the electrical meters on individual spaces.
The following individuals spoke in regard to the proposed change in water meter billing for mobile
home tenants and expressed a variety of concerns including unfair and unequal rent
increases, lack of an incentive to conserve water, costs associated with individual meters and
who will pay for the same, past City practice with direct tenant billing, and equity amongst all
ratepayers.
Shirley Plath
Ray Lunne
Ed Poole
Richard Streep
Bruce Davis
C. Comments by Public on Non -Agenda Items
None.
D. Adjournment
No action was taken by the City Council. The meeting was adjourned at 8:45 a.m.
ATTEST:
Randi Johl-Olson
City Clerk
AGENDA ITEM 5 A
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Receive Information Regarding Metering Options to Mobile Home Parks
MEETING DATE: December 10, 2013 (Shirtsleeve Session)
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Receive information regarding metering options to mobile home
parks.
BACKGROUND INFORMATION: For decades, most mobile home park tenants in Lodi have been
individually billed for water, wastewater and refuse service. One
exception is the Palms Mobile Home Park, located at
845 South Cherokee Lane, where the owner pays for all utilities.
For all mobile home parks, electric service is provided through a master meter, and the park tenants pay
their pro -rated share of the electric cost to the park owner. Each park has electric sub meters that are
read by the park owners and provide the basis for allocating the electric charges to the individual spaces.
This has also been the case for many decades.
After meeting with a majority of the mobile home park property owners, it was very clear they are not
interested in moving further into utility management and billing services. In fact, they would like to
eliminate their role on the electric side if at all possible.
City staff conducted a survey of 68 mobile home parks located in Lathrop, Manteca, Tracy, and Stockton.
County mobile home parks were not contacted because they are generally served by private wells or
County Service Area wells. A total of 27 surveys (40%) could be completed, with the remaining 41
locations either refusing to participate or unable to be contacted. The results of the survey are
summarized in the table below.
Results of 27 Surveys Completed
Total Number of Spaces
2,229
Water Master Meter
23 4 with Private Wells
Individual Water Meters(Utility Owned
0
Individual Water Sub -Meters Park Owned
8 (2 in Parks with Private Wells
Water Charges Included in Rent
13
Water Charges to Tenant with Sub -Meter
8
Water Charges to Tenant without Sub -Meter
6
Electric Master Meter
16
Individual Electric Meter (Utility Owned)
11
Gas Master Meter
16
Individual Gas Meter(Utility Owned
11
Highlights of the 27 parks surveyed are:
1. Of those surveyed, 23 (85%) have water master meters and four have private wells. Of the 23
with master meters, 10 include the water cost in the space rent and 13 charge the space tenant
based upon a water sub -meter (6) or o$her method (7).
`--' R6hradt Bartlam, City Manager
K:\WP\PROJECTS\WATER\Meters\Mobile Home Park\Shirtsleeve Dec 10 2103.doc
12/2/2013
Receive Information Regarding Metering Options to Mobile Home Parks
December 10, 2013 (Shirtsleeve Session)
Page 2
2. Of those surveyed, 16 have electric and gas master meters and the park owners are charging
space tenants for electric and gas usage. Individual utility -owned electric and gas meters exist at
11 locations.
The average water monthly usage per mobile home unit is 7.6 hundred cubic feet (CCF) per month,
compared to the Citywide average of 18 CCF per month per residential customer. This customer group
is one of the lowest water consumers in the City and, as a result, one would not expect usage to
significantly reduce if master or individual meters were installed. This condition is directly related to the
limited landscaped areas that exist in the mobile home parks.
Three alternatives to bill mobile home parks for water based upon usage are presented below, in the
order of staff's preference. The mobile home park owners' order of preference is opposite that of staff's.
Further discussion of each alternative is provided below.
Alternative 1 — Master Meters: Tenants see a 70 percent reduction in water cost (- $17.92) and a
42 percent reduction in wastewater cost (- $10.83) per month. Total savings = - $28.75.
Alternative 2 — Master Meter (Discounted): Tenants see a 70 percent reduction in water cost (- $17.92)
and a 42 percent reduction in wastewater cost (- $10.83) per month. Total savings = - $28.75. Park
owners keep the discount as a reimbursement for added labor and related costs.
Alternative 3 — Individual Meters: Tenants see increases of 20 percent (+ $5.08) in water cost and
37 percent (+ $9.66) in wastewater costs per month. Total increase = + $14.74.
Alternative 1: Master water meters were installed at six of the seven mobile home parks in 2012. Usage
has been recorded at these locations for at least the past 12 months and is reported in the six tables that
make up Exhibit A. The two mobile home parks named Casa de Lodi are reported as a single line in the
table. The Palms mobile home park is not yet fully metered and is not included in Exhibit A.
By dividing the 12 -month cost of water equally per space and averaging the result for all six parks, the
average per space monthly water charge is $7.75 or 70 percent lower (- $17.82) than the current City
charge of $25.67 for a mobile home unit. The average per space monthly wastewater charge is $15.00
or 42 percent lower (- $10.83) than the current City charge of $25.83. Total savings = - $28.75. Of
course, each park's numbers are slightly different.
By simply raising the rent per space, based upon the above, by $23.00 per month, the park owners cover
their water and wastewater utility costs and the tenants save $28.50 from what they had paid the City.
There are no requirements for park owners to invoice the space tenants for water and wastewater utility
costs or to incur the associated work effort to do so.
The City benefits by:
1. Having the mobile home park owners pay the water and wastewater bill along with the electric bill
they already receive.
2. Eliminates the preparation of 540 individual utility bills. Once water and wastewater are off the
bill, Waste Management bills directly and deals with collections from the space tenants.
3. Eliminates our current collections problems with tenants that have no City electric meter and that
cannot have service terminated for non-payment.
4. Having the park owners and management promote water conservation, although mobile home
tenants are amongst the lowest water consumers in the City.
Alternative 2: Master meter with owner discounts. This alternative is suggested by the mobile home park
owners as it is similar in structure to PG&E mobile home discounts that the City's Electrical Utility has
emulated. Currently, each park that is master metered receives a credit of $11.54 per occupied space
K:\WP\PROJECTS\WATER\Meters\Mobile Home Park\Shirtsleeve Dec 10 2103.doc 12/2/2013
Receive Information Regarding Metering Options to Mobile Home Parks
December 10, 2013 (Shirtsleeve Session)
Page 3
that is given each month on the City's Electric Utility bill. This credit number has risen from $8.13 at its
inception in 1989. The credit is intended to partially offset the cost of owning and maintaining the
distribution system, meter reading and billing services.
The amount of a similar water and wastewater credit would need to be determined. There is no City or
State requirement to sub meter water service and, therefore, any credit would need to be substantiated.
Wastewater service charges derive from measured water usage and no credit seems appropriate.
Under this alternative, tenants could still see, on average, a 70 percent reduction in water cost (- $17.92)
and a 42 percent reduction in wastewater cost (- $10.83) per month. The total average savings is $28.75
per space per month. Park owners would be required to install water sub meters. Park owners keep the
discount as a reimbursement for meter reading and billing services. The City benefits are similar to
Alternative 1.
A credit back to the mobile home park owners is not recommended because it could arguably apply to
apartment and condominium properties that are also master metered. In addition, credit back
arrangements were not found at the other mobile home parks serve by other water utilities. Again, the
electric credit back emulated a PG&E program at mobile home parks served by that utility.
Alternative 3: Individual meters, installed by the City on private property connecting to private water
mains, is the preferred solution of the mobile home park owners. Assuming similar meter installations to
the water meter program, the net cost to the City would be approximately $500,000 taking into account
the $300 per unit meter payment.
Under this scenario, each unit would be billed the monthly base charge (currently $23.78 and $23.52 for
water and wastewater,. respectively) and the tiered usage charge for a residential unit. The tenants
would see increases of 20 percent (+ $5.08) in water cost and 37 percent (+ $9.66) in wastewater costs
per month. Total = + $14.74. The monthly billing would be based upon usage and compliant with state
law. Based upon the average monthly usage data collected, the monthly water charge would be $30.75
and the wastewater charge would be $35.49.
Because mobile home units are amongst the lower users in the residential customer class and they are
only 540 or 3.3 percent of our customers in this class, it is unlikely that measureable conservation could
be realized by the installation of meters or even sub -meters.
Under this alternative the City would continue to bill the individual tenants. There would be an increase in
maintenance effort associate with the additional 540 meters. The park owners would continue status quo
with respect to their utility responsibilities. The tenants would see an increase in their total water and
wastewater bill of $14.74 or 29 percent above the current charge of $51.50.
FISCAL IMPACT: Not Applicable
FUNDING AVAILABLE: Not Applicable
49Z6, ja.,
F. Wally ndelin
Public Works Director
FWS/pmf
Attachment
K:\WP\PROJECTS\WATER\Meters\Mobile Home Park\Shirtsleeve Dec 10 2103.doc 12/2/2013
Exhibit A-1
Mobile Home Parks
General Information
Park
Address
Number of
Pads
Rate Effective
January 2013
Flat Rate
Billed Amount
Current
Billing To:
Casa De Lodi
812 and 817 E. Turner Rd
240
$25.67
$6,160.80
Tenants
Almond Drive Estates
471 E Almond Dr
85
$25.67
$2,181.95
Tenants
Shady Acres
621 E Lockeford St
43
$25.67
$1,103.81
Tenants
The Palms*
845 S Cherokee Ln
41
$25.67
$1,052.47
Park Owner
Cherokee Park
1651 S Cherokee Ln
43
$25.67
$1,103.81
Tenants
Lake Park **
11390 W Lockeford St
34
$25.67
$872.78
Tenants
All mobile home units are billed at the 1 bedroom apartment rate.
*41 pads, 6 cottages & 3 small houses
**34 usable spaces (the 35th space is all mailboxes and unusable)
Exhibit A-2
Casa De Lodi
812 and 817 E. Turner Rd
Month
Meter
Size
Usage -Based
Charge
Meter
Size
Usage -Based
Charge
Total Usage-
Based Charge
Flat Rate
Billed Amount
Difference
Sep -1 3
3
$1,602.22
3
$1,059.42
$2,661.64
$6,160.80
$3,499.16
Aug -1 3
3
$1,652.82
3
$1,006.06
$2,658.88
$6,160.80
$3,501.92
Jul -13
3
$1,683.18
3
$1,026.30
$2,709.48
$6,160.80
$3,451.32
Jun -13
3
$1,672.14
3
$1,026.30
$2,698.44
$6,160.80
$3,462.36
May -13
3
$1,339.10
3
$960.06
$2,299.16
$6,160.80
$3,861.64
Apr -1 3
3
$1,300.46
3
$857.94
$2,158.40
$6,160.80
$4,002.40
Mar -13
3
$1,300.46
3
$425.54
$1,726.00
$6,160.80
$4,434.80
Feb -13
3
$1,305.98
3
$405.30
$1,711.28
$6,160.80
$4,449.52
Jan -13
3
$1,172.58
3
$435.66
$1,608.24
$6,160.80
$4,552.56
Dec -12
3
$1,070.31
3
$416.01
$1,486.32
$6,009.60
$4,523.28
Nov -12
3
$1,271.91
3
$559.11
$1,831.02
$6,009.60
$4,178.58
Oct -12
3
$1,366.96
3
$910.11
$2,277.07
$6,009.60
$3,732.53
Sep -12
3
$1,409.10
3
$843.51
$2,252.61
$6,009.60
$3,756.99
Aug -12
3
$1,366.96
3
$918.21
$2,285.17
$6,009.60
$3,724.43
Jul -12
3
$1,451.24
3
$993.81
$2,445.05
$6,009.60
$3,564.55
Jun -12
3
$1,366.96
3
$905.96
$2,272.93
$6,009.60
$3,736.67
Ma -12
1 3
1 $1,830.49
3
1 $725.26
1 $2,555.74
1 $6,009.60
1 $3,453.86
There are two 8 -inch meters installed due to fire hydrant requirements. Monthly base charges are based upon
two 3 -inch meter required to serve the mobile home units and park facilities.
Refer to Exhibit B-1 for the calculation of the flat rate billed amount.
Exhibit A-3
Almond Drive Estates
471 E Almond Dr
Month
Meter
Size
Usage -Based
Charge
Sep -1 3
3
$780.66
Aug -1 3
3
$920.50
Jul -13
3
$867.14
Jun -13
3
$855.18
Ma -13
3
$822.06
Apr -1 3
3
$612.30
Mar -13
3
$577.34
Feb -13
3
$483.50
Jan -13
3
$517.54
Dec -12
3
$497.01
Nov -12
3
$611.31
Oct -12
3
$795.81
Sep -12
3
$861.25
Au -13
3
$1,023.77
Flat Rate Billed
Amount
Difference
$2,181.95
$1,401.29
$2,181.95
$1,261.45
$2,181.95
$1,314.81
$2,181.95
$1,326.77
$2,181.95
$1,359.89
$2,181.95
$1,569.65
$2,181.95
$1,604.61
$2,181.95
$1,698.45
$2,181.95
$1,664.41
$2,128.40
$1,631.39
$2,128.40
$1,517.09
$2,128.40
$1,332.59
$2,128.40
$1,267.15
$2,128.40
$1,104.63
Refer to Exhibit B-1 for the calculation of the flat rate billed amount.
Exhibit A-4
Shady Acres
621 E Lockeford St
Month
Meter
Size
Usage -Based
Charge
Sep -13
2
$594.70
Aug -1 3
2
$579.61
Jul -13
2
$539.32
Jun -13
2
$451.09
Ma -13
2
$367.00
Apr -1 3
2
$298.83
Mar -13
2
$212.44
Feb -13
2
$214.01
Jan -13
2
$222.19
Dec -12
2
$218.87
Nov -12
2
$235.88
Oct -12
2
$363.95
Sep -12
2
$470.51
Aug -12
2
$358.91
Jul -12
2
$363.14
Jun -12
2
$322.37
Ma -12
2
$243.89
Apr -12
2
$213.83
Mar -12
2
$230.21
Feb -12
2
$242.63
Flat Rate Billed
Amount
Difference
$1,103.81
$509.11
$1,103.81
$524.20
$1,103.81
$564.49
$1,103.81
$652.72
$1,103.81
$736.81
$1,103.81
$804.98
$1,103.81
$891.37
$1,103.81
$889.80
$1,103.81
$881.62
$1,076.72
$857.85
$1,076.72
$840.84
$1,076.72
$712.77
$1,076.72
$606.21
$1,076.72
$717.81
$1,076.72
$713.58
$1,076.72
$754.35
$1,076.72
$832.83
$1,076.72
$862.89
$1,076.72
$846.51
$1,076.72
$834.09
Refer to Exhibit B-1 for the calculation of the flat rate billed amount.
Exhibit A-5
Cherokee Park
1651 S Cherokee Ln
Month
Meter
Size
Usage -Based
Charge
$827.63
Meter
Size
Usage -Based
Charge
Total Usage -
Based Charge
Sep -1 3
2
$178.13
$1,103.81
1 1/2
$98.05
$276.18
Aug -1 3
2
$186.41
$870.14
1 1/2
$103.66
$290.07
Jul -13
2
$186.59
$1,076.72
11/2
$107.07
$293.66
Jun -13
2
$168.28
11/2
$103.66
$271.95
May -1 3
2
$173.53
1 1/2
$102.65
$276.18
Apr -1 3
2
$148.50
1 1/2
$81.49
$229.99
Mar -13
2
$150.71
11/2
$80.20
$230.91
Feb -13
2
$151.45
11/2
$82.23
$233.67
Jan -13
2
$150.80
11/2
$78.09
$228.89
Dec -12
2
$159.11
11/2
$76.59
$235.70
Nov -12
2
$179.63
11/2
$83.88
$263.51
Oct -12
2
$193.22
11/2
$95.22
$288.44
Se -12
1 2
$183.41
1 1/2
$106.29
$289.70
Au -12
1 2
$198.44
1 1 1/2
$110.43
$308.87
Flat Rate Billed
Amount
Difference
$1,103.81
$827.63
$1,103.81
$813.74
$1,103.81
$810.15
$1,103.81
$831.86
$1,103.81
$827.63
$1,103.81
$873.82
$1,103.81
$872.90
$1,103.81
$870.14
$1,103.81
$874.92
$1,076.72
$841.02
$1,076.72
$813.21
$1,076.72
$788.28
$1,076.72
$787.02
$1,076.72
$767.85
There are two meters installed. There is one 2 -inch meter and one 1 1/2 -inch meter. Monthly base
charges are based upon the size of the installed meter.
Refer to Exhibit B-1 for the calculation of the flat rate billed amount.
Exhibit A-6
Lake Park
1390 W Lockeford St
Month
Meter
Size
Usage -Based
Charge
Sep -13
2
$287.88
Aug -1 3
2
$281.99
Jul -13
2
$273.53
Jun -13
2
$271.69
Ma -13
2
$277.03
Apr -1 3
2
$223.48
Mar -13
2
$223.11
Feb -13
2
$235.17
Jan -13
2
$219.53
Dec -12
2
$209.78
Nov -12
2
$216.53
Oct -12
2
$238.49
Sep -12
2
$237.32
Aug -12
2
$205.10
Jul -12
2
$218.87
Jun -12
2
$205.82
Ma -12
2
1 $134.36
Flat Rate
Billed Amount
Difference
$872.78
$584.90
$872.78
$590.79
$872.78
$599.25
$872.78
$601.09
$872.78
$595.75
$872.78
$649.30
$872.78
$649.67
$872.78
$637.61
$872.78
$653.25
$851.36
$641.58
$851.36
$634.83
$851.36
$612.87
$851.36
$614.04
$851.36
$646.26
$851.36
$632.49
$851.36
$645.54
$851.36
$717.00
Refer to Exhibit B-1 for the calculation of the flat rate billed amount.