HomeMy WebLinkAboutAgenda Report - March 3, 2004 E-13 PHAGENDA ITEM COWM
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Set Public Hearing for April 7, 2004, to Consider Adopting Resolution
Adjusting Water, Wastewater and Refuse Rates
MEETING DATE: March 3, 2004
PREPARED BY: Public Works Director
RECOMMENDED ACTION: That the City Council set a public hearing for April 7, 2004, to
consider adopting a resolution adjusting water, wastewater and
refuse rates.
BACKGROUND INFORMATION: Water and wastewater rates were last adjusted in 2001 to fund a major
infrastructure replacement program. Refuse rates are adjusted
annually. Increased costs, as described below, require another rate
increase in order to maintain the financial health of these enterprises.
Water
In 2003, the water purchase contract with the Woodbridge Irrigation District was approved. This contract,
which costs $1.2 million per year, began in the second quarter of this fiscal year. At the time of adoption, staff
indicated a rate increase would be necessary and planned to incorporate this action with discussion on how to
utilize this water. However, due to various workload and other delays, this discussion is not yet ready to
occur. Yet, the financial pressure on the water utility from this contract and the PCEITCE issue is such that a
rate increase should not be delayed.
The PCE/TCE issue will, at best, increase cash flow demands upon the water utility, assuming that all our
costs are reimbursed. "Worse" scenarios would include additional non -reimbursable legal, technical,
administrative and clean-up costs that we do not recover. Staff recommends that the rate adjustment include
an amount over the minimum needed for the water purchase. With this increase and some, hopefully
temporary, adjustments in the capital replacement program, the water utility should be able to function and
pay these costs until the results of the PCEITCE issue are known. Also, as directed by the City Council on
February 18, 2004, the in -lieu of taxes transfer to the general fund is being reduced from 12% to 9%, to make
the increase essentially revenue neutral to the General Fund.
The recommended rate increase is shown in Table A. This would increase the rate for a two-bedroom home
by $5.68 per month. Also as requested by the Council, presented in Table A are rates for various low-income
discount options. Note that the calculations and rates shown are based on the total bill. The billing, which
shows the replacement program separately, would show the entire increase in the water portion and the
replacement program amount would be unchanged.
Wastewater
The State -mandated White Slough Water Pollution Control Facility improvements are being funded through
certificates of participation which will increase annual debt service requirements by approximately $2 million.
In addition, operating costs will increase with the additional improvements.
APPROVED:
SetPHW WWRates.doc
H. Dixdn Flynn, City Manager
2124/20x4
Set Public Hearing for April 7, 2004, to Consider Adopting Resolution Adjusting Water, Wastewater and
Refuse Rates
March 3, 2004
Page 2
Staff and our consultants are developing a cost and revenue model that brings these factors together and
presented a preliminary version to the City Council in October 2003. The model is still being refined as we
proceed on the 2004 financing, including analysis of required revenue/expense coverage ratios. The two
outstanding debts have different criteria on how coverage and "additional bonds test" are calculated and all
must be satisfied in order to issue the Phase 2 project COP's. Our financial consultants are recommending a
healthy coverage ratio rather than minimum levels in order to obtain the best possible interest rates. These
requirements, along with unavailability of the low-interest State Revolving Loan fund, are also driving up the
recommended rate increases.
The rate increase is still being refined and will be made available before the public hearing. The same
assumptions as in the water utility concerning the in -lieu transfer will be incorporated in the revenue model.
The existing rates are shown in Table B, which will be updated to show the proposed rates and discount
options similar to water in Table A.
In addition to wastewater service rates, the White Slough Water Pollution Control Facility improvements also
include capacity for future growth. Consistent with past practice, a portion of the costs have been allocated to
"growth", and, as described in the October 2003 shirtsleeve session, staff proposes to combine the "capacity"
fee, currently charged with building permits, into the wastewater impact mitigation fee (IMF) program. The
current capacity fee for a two-bedroom home is $2,099. The current wastewater IMF is $544/acre or $108.80,
assuming five homes per acre. The new combined fee, including the White Slough project increase, is
approximately $3,600 per two-bedroom home. Making these modifications will require changes to the City
Code, which will be presented at a later meeting.
At the February 18, 2004, City Council meeting, staff also discussed funding some PCE/TCE work in the
wastewater fund. Since the most likely costs involve the replacement of sewers (as has already been done at
one location) staff is not recommending an additional increase for PCE/TCE purposes since the revenue
model includes sufficient funds for these capital replacement projects as previously planned. (The locations,
however, might change.)
Low -Income Discount Program
The City's current discount for qualified low-income water and wastewater customers is 10%. These are
customers who are eligible for certain Social Security payments (SSI/SSP). Under a separate, later Council
item, staff is recommending that the eligibility criteria be broadened and made consistent with other electric
utility programs. However, that action does not include establishing the actual discount, which, if the
ordinance is approved, would be included in the rate resolution.
A 25% discount on both water and wastewater would largely negate the effects of the proposed rate
increases. The revenue impact at this percentage with the expanded eligibility criteria is estimated at roughly
$120,000 annually. Assuming the recommended ordinance is adopted, the discount rate would be set by
resolution.
Note that these discounts only apply to customers who pay their own bill for the applicable service. For rental
homes and apartments, practices among landlords can vary, so the user may not be able to receive all the
discounts.
Refuse
In 2002, Council adopted a resolution that approved set rate increases through 2005 beginning on April
1, 2002, at 1.5% per year. Along with the approved rate increase, Central Valley Waste Services is also
requesting an additional increase due to a recent landfill gate fee increase. Our contract with Central
Valley Waste Services states in Section 7, item g, that contractor may request and the City may grant
SetPH W_W W Rates.doc 2/26/2004
Set Public Hearing for April 7, 2004, to Consider Adopting Resolution Adjusting Water, Wastewater and
Refuse Rates
March 3, 2004
Page 3
rate changes when the contractor incurs increased costs due to a change in landfill costs. Staff has
verified the figures and the resulting rates are shown in Table C.
The low-income discount issue for refuse is slightly different than in water/wastewater. The refuse rates
have included a separate category for low-income with separate eligibility criteria for over ten years, and,
over time, it was not always raised along with other rates. It only applies to two service levels (20 -gallon
and 38 -gallon). Thus, the existing "discount" is far greater than 10%, as shown in Table C-1, category 6.
The criteria for this discount is "...less than $12,000 annual income for a single person...", with higher
limits for additional family members. The City's separate 10% discount for SSI/SSP recipients applies to
service categories 1 through 4. Staff proposes to eliminate category 6 as a separate rate class and apply
whatever discount the Council deems appropriate to all of the cart service categories (1 through 5). This
discount would be granted to customers who meet the eligibility criteria per the ordinance.
FUNDING: None needed.
41OV4
Richard C. Prima, Jr.
Public Works Director
RCP/pmf
Attachments
SetPHW WWRates.doc 2!2412004
Table A: Water Utilit
Residential Flat Rate (per month):
Single Family Unit (one bedroom)
(two bedrooms)
(three bedrooms)
(four bedrooms)
(five bedrooms)
(six bedrooms)
(seven bedrooms)
Multiple Family Unit (one bedroom)
(two bedrooms)
(three bedrooms)
Present Rate
%/<" meter
May -04
Discount Rates
A % Reduction Shown
1'/z" meter
$ 28.58
2" meter
$ 40.00
3" meter
10%
4" meter
20%
6" meter
25%
30%
$ 13.51
$
18.24
$
16.42
$
14.59
$
13.68
$ 12.77
$ 16.22
$
21.90
$
19.71
$
17.52
$
16.43
$ 15.33
$ 19.45
$
26.26
$
23.63
$
21.01
$
19.70
$ 18.38
$ 23.36
$
31.54
$
28.39
$
25.23
$
23.66
$ 22.08
$ 28.04
$
37.85
$
34.07
$
30.28
$
28.39
$ 26.50
$ 33.64
$
45.41
$
40.87
$
36.33
$
34.06
$ 31.79
$ 40.35
$
54.47
$
49.02
$
43.58
$
40.85
$ 38.13
$ 11.60
$
15.66
$
14.09
$
12.53
$
11.75
$ 10.96
$ 13.91
$
18.78
$
16.90
$
15.02
$
14.09
$ 13.15
$ 16.69
$
22.53
$
20.28
$
18.02
$
16.90
$ 15.77
Commercial/Industrial Flat Rate varies
(Existing accounts only. New accounts are metered.)
Metered Rate
plus monthly base charge:
Construction Water Charges:
+ 20% for ea. addT bedroom
add: 35%
$ 0.524 per 100 cu. ft
(approx. 70¢ per 1,000 gal.)
$ 11.43
%/<" meter
$ 17.14
1" meter
$ 22.85
1'/z" meter
$ 28.58
2" meter
$ 40.00
3" meter
$ 51.43
4" meter
$ 74.29
6" meter
$ 97.16
8" meter
$ -
10" meter
$ 0.707
(approx. 95¢ per 1,000 gal.)
$ 15.43
$ 23.14
$ 30.85
$ 38.58
$ 54.00
$ 69.43
$ 100.29
$ 131.17
$ 162.04
$ 0.524 per 100 cu. ft. $ 0.707
Note: Includes reduction in General Fund In -lieu transfer from 12% to 9% beginning in FY05/06 based on full year of increased revenue
Table B: Wastewater Utility
Present Rate May -04
Disposal to Domestic System:
Residential (per month) 1 Bedroom
$
9.73
2 Bedrooms (basis for 1 Sewage Service Unit)
$
12.97
3 Bedrooms
$
16.23
4 Bedrooms
$
19.47
5 Bedrooms
$
22.71
6 Bedrooms
$
25.95
7 Bedrooms
$
29.20
Moderate Strength (annual per SSU)
$
155.68
(Most commercial & industrial unless "high
High strength user:
Flow (per MG, annual basis)
$
749.09
BOD (per 1,000 lbs., annual basis)
$
366.58
SS (per 1,000 lbs., annual basis)
$
299.66
Grease Interceptor and Septic Holding Tank Waste
$
114.75
within City Limits (per 1,000 gal.)
Septic (only) Holding Tank Waste Outside City
$
243.61
Disposal to Storm Drain System (per MG)
$
120.53
Disposal to Industrial System:l basis)
Flow (per MG, annual basis)
$
954.30
BOD (per 1,000 lbs., annual basis)
$
33.56
Jul -05 July 2005 Discount Rates A % Reduction Shown
10% 20% 25% 30%
Table C-1 - Solid Waste (Refuse)
Present Rate Discount Rates Cad % Reduction Shown
Per Month May -04 10% 20% 25% 30%
1. 38 GALLON REFUSE CART 1X PER WEEK*"
1 Refuse Cart
$19.12
$
19.64
$
17.68
$
15.71
$
14.73
$
13.75
2 Refuse Carts
$47.79
$
49.08
$
44.17
$
39.26
$
36.81
$
34.36
3 Refuse Carts
$76.46
$
78.52
$
70.67
$
62.82
$
58.89
$
54.96
4 Refuse Carts
$105.13
$
107.96
$
97.16
$
86.37
$
80.97
$
75.57
2. 64 GALLON REFUSE CART 1X PER WEEK*"
1 Refuse Cart
$28.75
$
29.52
$
26.57
$
23.62
$
22.14
$
20.66
2 Refuse Carts
$71.88
$
73.82
$
66.44
$
59.06
$
55.37
$
51.67
3 Refuse Carts
$114.99
$
118.09
$
106.28
$
94.47
$
88.57
$
82.66
3. 96 GALLON WASTE CART 1X PER WEEK*"
1 Refuse Cart
$62.71 $
64.40
$ 57.96
$ 51.52
$ 48.30
$ 45.08
2 Refuse Carts
$125.43 $
128.81
$ 115.93
$ 103.05
$ 96.61
$ 90.17
3 Refuse Carts
$188.14 $
193.21
$ 173.89
$ 154.57
$ 144.91
$ 135.25
4. DUPLEX AND MULTI -FAMILY, AND MOBILE HOMES
Monthly rate is reduced from above base rates
($1.00)
($1.00)
($1.00)
($1.00)
($1.00)
($1.00)
5. LOW VOLUME USER 1X PER WEEK****
One (1) - 20 Gallon Low Volume Refuse Cart
6. LOW INCOME USER 1X PER WEEK****
20 Gallon Refuse Cart
38 Gallon Refuse Cart
$13.01 $ 13.36 $ 12.02 $ 10.69 $ 10.02 $ 9.35
$8.24 n/a 37% existing rate discount
$10.30 n/a 46% existing rate discount
7. ADDITIONAL 64 GALLON RECYCLING CARTS
Second and Third Recycling Cart No Additional Charge
Fourth and Each Additional Cart $10.30 $ 10.58
8. ADDITIONAL 96 GALLON YARD AND GARDEN CARTS
Second and Third Yard and Garden Cart No Additional Charge
Fourth and Each Additional Yard and Garden Car $10.30 $ 10.58
9. BACKYARD SERVICE***"
Monthly service charge $10.77 $ 11.06
Qualified Disabled No Additional Charge
** Eligible for 10% City Utility Discount Program (Will revise note per Council approval)
**** Applies to Single Family Dwellings Only
WEEKLY SERVICE - ONE (1) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
S
102.64
S
190.97
S 437.58
S 789.70
S 1,27.34
S
1,810.50
2
S
163.08
S
297.53
S 621.91
S 1,072.93
S 1,650.56
S
2,354.79
3
S
223.51
S
404.09
S 806.26
S 1,356.16
S 2,053.77
S
2,899.09
4
S
283.94
S
510.65
S 990.59
S 1,639.36
S 2,456.96
S
3,443A0
5
S
344.39
S
617.21
S 1,174.94
S 1,922.59
S 2,860.19
S
3,987.70
6
S
404.82
S
723.77
S 1,359.26
S 2,205.82
S 3,263.38
S
4,531.99
7
S
465.26
S
830.34
S 1,543.62
S 2,489.04
S 3,666.59
S
5,076.29
8
S
525.69
S
936.89
S 1,727.96
S 2,772.25
S 4,069.80
S
5,620.59
9
S
586.13
S
1,043.46
S 1,912.30
S 3,055.49
S 4,473.02
S
6,16.90
10
S
646.56
S
1,150.00
S 2,096.63
S 3,338.70
S 4,876.21
S
6,709.18
WEEKLY SERVICE - TWO (2) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
$
149.56
S
281.90
$ 583.35
S 997.52
S 1,524.41
$
2,164.03
2
S
254.00
S
473.63
$ 896.16
S 1,453.99
$ 2,147.03
$
2,975.39
3
$
358.45
S
665.35
$ 1,209.00
S 1,910.44
S 2,769.68
S
3,786.75
4
S
462.89
S
857.10
S 1,521.81
S 2,366.87
S 3,392.31
S
4,598.11
5
S
567.35
S
1,048.80
$ 1,834.63
S 2,823.34
$ 4,014.95
S
5,409.48
6
S
671.80
S
1,240.54
S 2,147.42
S 3,279.80
S 4,637.59
S
6,220.83
7
$
776.26
S
1,432.27
$ 2,460.27
S 3,736.25
$ 5,260.21
S
7,032.19
8
S
880.70
S
1,624.01
$ 2,773.08
S 4,192.70
S 5,882.85
S
7,843.55
9
S
985.17
S
1,815.73
S 3,085.91
S 4,649.15
S 6,504.78
S
8,654.90
10
S
1,089.61
S
2,007.44
S 3,398.72
S 5,105.60
S 7,129.19
S
9,466.26
WEEKLY SERVICE -THREE (3) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
$ 190.41
S 360.77
$ 700.21
S 1,152.37
$ 1,717.27
$
2,394.88
2
$ 335.72
S 631.35
$ 1,129.90
S 1,763.69
S 2,532.76
$
3,437.12
3
$ 481.03
$ 901.95
$ 1,559.58
S 2,375.01
$ 3,348.27
$
4,479.33
4
$ 626.32
S 1,172.52
$ 1,989.24
S 2,986.32
$ 4,163.76
S
5,521.57
5
S 771.63
S 1,443.11
S 2,418.92
S 3,597.65
S 4,979.28
$
6,563.77
6
$ 916.96
$ 1,713.69
$ 2,848.60
$ 4,208.95
$ 5,794.76
S
7,606.00
7
$ 1,062.25
$ 1,983.94
$ 3,278.28
$ 4,820.26
$ 6,610.24
S
8,648.23
8
$ 1,207.57
S 2,254.85
S 3,707.96
$ 5,431.59
$ 7,425.76
S
9,690.46
9
$ 1,352.87
S 2,525.44
$ 4,137.64
$ 6,042.90
$ 8,241.25
$
10,732.67
10
S 1,498.19
S 2,796.03
$ 4,567.32
$ 6,654.22
$ 9,056.74
S
11,774.89
WEEKLY SERVICE - FOUR (4) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
S
231.27
$ 439.63
S 817.08
S
1,307.26
S
1,910.15
S
2,625.77
2
S
417.45
S 789.08
S 1,363.62
S
2,073.43
S
2,918.51
S
3,898.86
3
S
603.62
S 1,138.55
S 1,910.17
S
2,839.63
S
3,926.88
S
5,171.95
4
S
789.80
S 1,488.00
S 2,456.72
$
3,605.81
S
4,935.25
S
6,445.05
5
S
975.96
S 1,837.45
S 3,003.27
S
4,372.00
S
5,943.63
S
7,718.15
6
S
1,162.15
S 2,186.91
S 3,549.83
S
5,138.19
S
6,951.99
S
8,991.24
7
S
1,348.33
S 2,536.37
S 4,096.38
S
5,904.38
S
7,960.36
S
10,264.35
8
S
1,534.52
$ 2,885.82
S 4,642.93
S
6,670.56
S
8,968.73
S
11,537.44
9
S
1,720.69
$ 3,235.28
S 5,189.47
S
7,436.77
S
9,977.11
S
12,810.53
10
S
1,906.87
S 3,584.72
S 5,736.02
S
8,202.92
S
10,985.48
S
14,083.64
WEEKLY SERVICE - FIVE (5) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
S 272.13
$ 518.51
S 933.95
$
1,462.12
S
2,103.02
S
2,856.63
2
S 499.18
$ 946.81
S 1,597.38
S
2,383.19
$
3,304.26
S
4,360.59
3
S 726.22
$ 1,375.15
S 2,260.78
S
3,304.24
S
4,505.51
S
5,864.58
4
S 953.25
S 1,803.47
S 2,924.21
$
4,225.31
S
5,706.74
S
7,368.55
5
S 1,180.32
S 2,231.80
S 3,587.63
$
5,146.36
S
6,907.98
S
8,872.52
6
S 1,407.36
S 2,660.12
S 4,251.05
$
6,067.41
S
8,109.23
S
10,376.48
7
S 1,634.41
S 3,088.44
S 4,914.47
$
6,988.48
$
9,310.47
S
11,880.45
8
S 1,861.45
$ 3,516.77
S 5,577.89
S
7,909.54
S
10,511.70
S
13,384.43
9
S 2,088.50
S 3,945.09
S 6,241.29
S
8,830.59
S
11,712.96
S
14,888.41
10
S 2,315.55
$ 4,373.41
S 6,904.71
S
9,751.65
S
12,914.18
S
16,392.37
WEEKLY SERVICE - SIX (6) CUBIC YARD CONTAINER
# OF
CONTAINERS 1 X WK 2 X WK 3 X WK 4 X WK 5 X WK 6 X WK
1
S 312.99
S 597.35
S 1,050.83
S
1,616.98
S
2,295.88
$
3,087.51
2
S 580.89
S 1,104.55
S 1,831.09
$
2,692.91
$
3,689.99
S
4,822.33
3
S 848.81
$ 1,611.72
S 2,611.38
$
3,768.82
$
5,084.09
S
6,557.18
4
$ 1,116.70
$ 2,118.90
S 3,391.64
S
4,844.74
S
6,478.19
$
8,292.00
5
S 1,384.60
S 2,626.07
S 4,171.92
S
5,920.66
S
7,872.30
$
10,026.84
6
$ 1,652.50
$ 3,133.28
S 4,952.21
$
6,996.59
$
9,266.40
S
11,761.68
7
$ 1,920.41
$ 3,640.46
S 5,732.48
$
8,072.50
S
10,660.51
S
13,496.50
8
$ 2,188.30
$ 4,147.64
S 6,512.75
$
9,148.42
$
12,054.60
S
15,231.34
9
S 2,456.21
$ 4,654.82
S 7,293.05
$
10,224.34
$
13,448.71
S
16,966.17
10
$ 2,724.12
$ 5,162.00
$ 8,073.31
$
11,300.25
$
14,842.82
$
18,701.02
10 TO 50 CUBIC YARD CONTAINERS
RATE STRUCTURE
EFFECTIVE APRIL 1, 2004 THROUGH MARCH 31, 2005
PERMANENT HIGH FREQUENCY ROLL -OFF RATES
1. Drop-off and Pick-up Charge Per Box
2. Weighed Tons Disposed/Box X Processing Charge
3. Franchise Fee (4.8% of 1+2)
TOTAL BILL (1+2+3)
ONE-TIME TEMPORARY USER ROLL -OFF RATES
1. Drop/off/Pick-up Charge Per Box
2. Tons Disposed/Box X Processing Charge
(Average of five (5) tons charged per Box)
3. Franchise Fee (4.8% of 1+2)
TOTAL BILL (1+2+3)
RATES
$ 136.17
S 30.66
S -
$ 172.81
S 30.66