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Home My WebLink AboutAgenda Report - May 17, 2023 C-19 PHCITY OF ft*r zt�1 r CALIFORNIA AGENDA ITEM COO119 COUNCIL COMMUNICATION AGENDA TITLE: Set Public Hearing for June 21, 2023, to Consider Adopting Resolution Setting Pre -Approved Engineering News Record Adjustment Index for Wastewater Rates for Residential, Commercial, and Industrial Customers MEETING DATE: May 17, 2023 PREPARED BY: Public Works Director RECOMMENDED ACTION: Set Public Hearing for June 21, 2023, to consider adopting resolution setting pre -approved Engineering News Record adjustment index for wastewater rates for residential, commercial, and industrial customers. BACKGROUND INFORMATION: The City Council has made numerous wastewater rate decisions over the past several years. On March 20, 2019, Council voted to approve a five- year program of rate adjustments for water, wastewater, and solid waste services, in accordance with the Proposition 218 rate setting process. The proposed rate adjustments are needed to generate sufficient revenue to meet ongoing operation and maintenance costs and debt service obligations, as well as, necessary capital maintenance improvements. For the wastewater utility, the annual rate adjustment, if approved, is the lesser of the Engineering News Record (ENR) index change or three percent. A summary of the past years' wastewater rate adjustments relative to the ENR index change is provided in the table below. The purpose of this table is to demonstrate that, due to sound financial management, past actual rate increases have frequently been below the approved maximum or deferred to coordinate with the programming of capital improvement projects. At present, the wastewater operating fund balance exceeds target operating reserves. This surplus will be needed to fund wastewater capital expenditures amounting to almost $30 million over the next five years without borrowing. Council recently awarded several large projects including the White Slough Water Pollution Control Facility (WSWPCF) Electrical Building Associated Improvements Project ($14,400,000); White Slough ,4i'1 Stephen Schwabauer, City Manager \\cvcfilv02\pubwks$\WP\UTILITY RATES\W_WW\2023 W—WW Rate Increase\CCSetPH WW Rates.dou 5/8/2023 Cap ENR Approved/ Index Recommended July 2017 3.0% 4.2% 0% July 2018 3.0% 2.7% 0% July 2019 3.0% 2.9% 2.9% July 2020 1 3.0% 1.5% 0% July 2021 3.0% 3.1% 0% July 2022 3.0% 8.9% 3% July 2023 3.0% 3.0% 3% At present, the wastewater operating fund balance exceeds target operating reserves. This surplus will be needed to fund wastewater capital expenditures amounting to almost $30 million over the next five years without borrowing. Council recently awarded several large projects including the White Slough Water Pollution Control Facility (WSWPCF) Electrical Building Associated Improvements Project ($14,400,000); White Slough ,4i'1 Stephen Schwabauer, City Manager \\cvcfilv02\pubwks$\WP\UTILITY RATES\W_WW\2023 W—WW Rate Increase\CCSetPH WW Rates.dou 5/8/2023 Set Public Hearing for June 21, 2023, to Consider Adopting Resolution Setting Pre -Approved Engineering News Record Adjustment Index for Wastewater Rates for Residential, Commercial, and Industrial Customers May 17, 2023 Page 2 Solids Handling Facility Improvements ($2,424,725) and recently accepted the Wastewater Rehabilitation Project Phase 9 ($1,686,099). These large projects total approximately $18,510,824. These current and projected capital expenditures coupled with inflation exceeding 5% per year is driving the recommended increase. The current Proposition 218 water and wastewater rate plan expires December 31, 2023. Staff is currently working with a consultant to prepare an updated rate study to establish a rate plan for the next 5 years. The rate study and proposed rate plan will be brought before Council this summer for feedback and consideration. The recommended rate adjustment for this next year (Exhibit A) reflect a recommended increase of 3 percent. FISCAL IMPACT: Increased revenues are required to properly fund capital maintenance, to keep up with cost of service increases, and State mandated costs. FUNDING AVAILABLE: Not applicable Charles E. Swimley, Jr. Public Works Director CES/RAY/cd Attachment \\cvcfilv02\pubwks$\WP\UTILITY RATES\W_WW\2023 W—WW Rate Increase\CCSetPH_WW Rates.docx 5/8/2023 Exhibit A City of Lodi -- Wastewater Utility current ana Proposes Wastewater Rates Current Julv 2023 Percent Increase 3.0 Flat Rates ($/month) 1 Bedroom $ 29.57 $ 30.45 2 Bedroom $ 39.42 $ 40.60 3 Bedroom $ 49.28 $ 50.75 4 Bedroom $ 59.13 $ 60.90 5 Bedroom $ 68.99 $ 71.05 6 Bedroom $ 78.84 $ 81.20 7 Bedroom $ 88.70 $ 91.35 Mobile Homes Any Size $ 29.57 $ 30.46 Schools Students per SSU $ 38.35 $ 39.50 Usage -Based Rates (1) Monthly Usage Charge ($/CCF) (1) $ 3.06 $ 3.15 3/4" Meter Charge per month $ 26.92 $ 27.73 1" Meter Charge per month $ 43.37 $ 44.67 1 1/2" Meter Charge per month $ 83.79 $ 86.30 2" Meter Charge per month $ 131.78 $ 135.73 3" Meter Charge per month $ 246.20 $ 253.59 4" Meter Charge per month $ 408.60 $ 420.86 6" Meter Charge per month $ 814.28 $ 838.71 8" Meter Charge per month $ 1,301.27 $ 1,340.31 Notes: (1) Winter water usage determined as average monthly usage from December through February. Please immediately confirm receipt of thisfax by calling 333-6702 CITY OF LODI P. O. BOX 3006 LODI, CALIFORNIA 95241-1910 ADVERTISING INSTRUCTIONS SUBJECT: NOTICE OF PUBLIC HEARING TO CONSIDER ADOPTING RESOLUTION SETTING PRE -APPROVED ENGINEERING NEWS RECORD ADJUSTMENT INDEX FOR WASTEWATER RATES FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL CUSTOMERS PUBLISH DATE: SATURDAY, MAY 20, 2023 TEAR SHEETS WANTED: One (1) please SEND AFFIDAVIT AND BILL TO: OLIVIA NASHED, CITY CLERK LNS ACCT. #5100152 City of Lodi P.O. Box 3006 Lodi, CA 95241-1910 DATED: THURSDAY, MAY 18, 2023 ORDERED BY: OLIVIA NASHED CITY CLERK PAMELA M. FARRIS KA L E CLAYTON ASSISTANT CITY CLERK ADMINISTRATIVE CLERK Verify Appearance of this Legal in the Newspaper — Copy to File Emailed to the Sentinel at legals@lodinews.com at Tv (time) on 5 (date) i forms\advins.doc DECLARATION OF POSTING NOTICE OF PUBLIC HEARING TO CONSIDER ADOPTING RESOLUTION SETTING PRE -APPROVED ENGINEERING NEWS RECORD ADJUSTMENT INDEX FOR WASTEWATER RATES FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL CUSTOMERS On Thursday, May 18, 2023, in the City of Lodi, San Joaquin County, California, a copy of a Notice of Public Hearing to consider adopting a resolution setting pre -approved Engineering News Record adjustment index for wastewater rates for residential, commercial, and industrial customers (attached hereto, marked Exhibit "A") was posted at the following locations: Lodi City Clerk's Office Lodi City Hall Lobby Lodi Carnegie Forum WorkNet Office I declare under penalty of perjury that the foregoing is true and correct. Executed on May 18, 2023, at Lodi, California. PAMELA M. FARRIS ASSISTANT CITY CLERK ORDERED BY: OLIVIA NASHED CITY CLERK t�4t� n_�a_f KAYLEE tLAYTON ADMINISTRATIVE CLERK \\cvcfi1v0I\administration$\Administration\CLERK\Agenda\City Council\Public Hearings\AFFADAVITS\DECPOST 1. DOC CITY OF LODI � a Carnegie Forum $ 305 West Pine Street, Lodi NOTICE OF PUBLIC HEARING Date: June 21, 2023 Time: 7:00 p.m. EX. For information regarding this notice please contact: Olivia Nashed City Clerk Telephone: (209) 333-6702 NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that on Wednesday, June 21, 2023, 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 item: a) Adopting a resolution setting pre -approved Engineering News Record adjustment index for wastewater rates for residential, commercial, and industrial customers. 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 West 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, 221 West Pine Street, at or prior to the close of the public hearing. By Order of the Lodi City Council: Olivia Nashed City Clerk Dated: May 17, 2023 Approved as to form: ff Katie Lucchesi Deputy City Attorney "ISO: Para obtener ayuda interpretativa con esta noticia, por favor (lame a la oficina de la Secretaria Municipal, a las (209) 333-6702. CLERK\PUBHEAR%NOTICES%NotPD_Waslewaler 5/11/23