HomeMy WebLinkAboutAgenda Report - June 2, 2004 I-01AGENDA ITEM 1401
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Adopt Urgency Ordinance Repealing and Reenacting LMC §13.04.130 and
Establishing Low Income Discounts for Water, Sewer and Refuse Services
and Adopt Resolution Establishing Discounts
MEETING DATE: June 2, 2004
PREPARED BY: Public Works Director
RECOMMENDED ACTION: That the City Council adopt an urgency ordinance repealing and
reenacting LMC §13.04.130 establishing low income discounts for
water, sewer and refuse services and adopt a resolution
establishing discounts.
BACKGROUND INFORMATION: In discussion on water and wastewater rates, the subject of
providing a meaningful discount for low income residents was
brought up. Staff is recommending a change in the City's current
discount program as described below.
Currently, the Lodi Municipal Code contains the following section:
13.04.130 Low income adjustments.
The rates for residential water, sewer and refuse collection service as they now exist or may hereafter
be modified under this chapter, shall be reduced by ten percent (exclusive of surcharges, if any) for
those residential accounts in the names of person otherwise eligible for Supplemental Security
Income (SSI), or State Supplement Payments (SSP), as determined by the Social Security
Administration, which shall have sole discretion in determining such eligibility. Proof of eligibility may
be required by the city to qualify for the rate adjustments provided herein. (Ord. 1445 § 1, 1989)
In addition, the City has various electric and refuse programs, as summarized on Exhibit A. Note that the
refuse discount was actually far greater than 10% due to the way past rate increases were handled;
however, the rates adopted on April 27, 2004, eliminated that separate rate category. Customers in that
rate category are being given the SSI/SSP 10% discount.
There are about 1,300 customers receiving electric discounts, almost 900 receiving refuse discounts and
about 300 receiving water/wastewater discounts. The actual number of customers on these discount
programs varies due to both different eligibility criteria and the fact that not all customers pay each of
these bills. For example, a landlord might pay water and sewer and the tenant pays refuse and electric.
This recommendation is based on the fundamental concept that the City should have one set of eligibility
criteria for its discount programs, although the amount of the discount may vary among the utilities; and,
they would be set by resolution. This will allow one administrative process for approval rather than two or
three.
The text of the proposed ordinance is as follows:
APPROVED:
Manager
CRateOiscountsRevised. doc v t 512412004
Adopt Urgency Ordinance Repealing and Reenacting LMC §13.04.130 and Establishing Low Income
Discounts for Water, Sewer and Refuse Services and Adopt Resolution Establishing Discounts
June 2, 2004
Page 2
13.04.130 Low income adjustments.
The rates for residential water, sewer and refuse collection service as they now exist or may
hereafter be modified under this chapter, shall be reduced as established by resolution for those
residential accounts in the names of persons meeting the eligibility criteria for applicable electric
service discounts as provided in this Title. Proof of eligibility may be required by the city to qualify
for the rate adjustments provided herein.
Staff suggests that the Council consider adopting ordinance as an urgency measure so that the discounts
can be effective as soon as possible since the increased rates adopted on April 27, 2004, are now in
effect. This will be much better for the public and certainly save staff time and expense in either
responding to questions or processing refunds should the Council direct that refunds be given.
A draft of the implementing resolution is attached, with the recommended discounts. The annual cost to the
utilities, making various assumptions as to how many customers will seek the discounts is shown below.
Assumptions
• 95% of existing SHARE program customers would receive the discounts. This accounts for
residential units in which the landlord pays the utility bill. No change is proposed to the eligibility
criteria, so we have not assumed an increase in the number of SHARE customers.
• 100% of existing Senior/Fixed Income program customers will receive the discounts.
• Same mix of billing classifications as current customers.
• The discount percentages as recommended:
SHARE Sr./Fixed Income
Refuse 30% 10%
Water 20% 10%
Wastewater 20% 10%
Costs {Revenue Loses
• "Cost" shown below is total less estimated cost of existing program {annual}
SHARE Sr./Fixed Income
Refuse $ 7,930 $ 2,800
Water $ 60,300 $ 3,300
Wastewater $ 46,700 $ 2,500
• The total cost to other ratepayers varies, but is on the order of 8 to 27 cents per month.
Staff also notes that Central Valley Waste Services has reviewed the proposed discounts and has sent a
letter stating their concurrence (see attached).
The issue of ongoing verification of eligibility will be addressed by staff once the Council provides
direction on the overall program.
FUNDING: Administration costs would be borne by the Electric, Water and Wastewater funds
and revenue loss wouldocc in each of a four revenue funds.
(
Richard C. Prima,
Public Works Director
RCPlpmf
Attachments
cc: Alan Vallow, Electric Utility Director
Jim Krueger, Finance Director
CRateDiscountsRevised.doc 5/2412004
Exhibit A
Refuse Rate Reduction Program
Residential customers may apply for a reduction in their rate due to personal economic
hardship. The rate reduction is actually a set rate depending on the size of the cart.
20 -gallon carts are currently at a rate of $8.24 and the 38 -gallon cart at $10.30. The
criteria for this program is proof of income that meets the following guidelines:
One person in household $12,000/year
Each additional person add $2,000/year
Once application is approved there is no follow-up procedure to verify continued
eligibility.
SHARE Program
This program allows residential customers to apply for a discount of 20% on their
monthly utility bill. The criteria for this program is proof of income that meets the
following guidelines:
Number of Persons in Household Maximum Annual Household Income
1-2 $22,000
3 $25,900
4 $31,100
Each additional member $5,200
Once the application is approved, it is up to the applicant to notify the
Finance Department within 30 days of becoming ineligible for the program.
SSI & SSP Recipient Discount Program
If a resident receives SSI or SSP, they may be eligible for a 10% discount on Water,
Sewer and Refuse rates. Once the application is filled out, the Finance Department will
send the form to the Social Security Administration to verify eligibility. Once approved,
there is no follow-up procedure to verify continued eligibility.
Senior Fixed Income Program
This program allows for residential customers over the age of 62 with a maximum
household income of $45,000 to apply for a 5% discount on their monthly electric bill.
SHARE Program Discounts
Notes:
*Out of the 1355 Electric(SHARE Program) discounts, 209 also have water
discounts and 211 have wastewater discounts
Assuming all but 5% of existing SHARE Customers will receive discount
1355 95% 1287
Total Utility
Total
Revenue, Old
# of
Old
Annual
Proposed
Estimated #
Est. Revenue
Net Increase
Total % Loss,
Approximate
Customers
Discount
Revenue
New rates
Proposed
Discounted
of Eligible
Loss w/ New
in Revenue
New Total %
Amount on
Utility
w/discount
Old Rates
Rate
Loss
(May 2004)
Discount
Rate
Customers
Discount Shown
Loss
Loss
New Rate
Refuse
(38 gallon)
580
$19.12
$10.30
$61,387.20
$19.64
30%
$13.75
918
$64,906.27
$ 7,021,800
$0.23
(20 gallon)
233
$13.01
$8.24
$13,336.92
$13.36
30%
$9.35
369
$17,747.42
1.1%
$0.16
813
Subtotal:
$74,724.12
Subtotal:
$82,653.70
$7,929.58
1.2%
Water
10%
(not incl. infrastructure repl. chg.)
20%
(on total charge)
apartment, 1 bedroom
78
$11.60
$10.86
$694.51
$15.66
$12.53
338
$12,703.39
$0.13
apartment, 2 bedroom
48
$13.91
$13.02
$512.64
$18.78
$15.02
208
$9,374.98
$0.16
apartment, 3 bedroom
2
$16.69
$15.62
$25.63
$22.53
$18.02
9
$486.65
$0.19
house, 1 bedroom
22
$13.51
$12.65
$228.36
$18.24
$14.59
95
$4,158.72
$0.15
house, 2 bedroom
75
$16.22
$15.18
$934.20
$21.90
$17.52
325
$17,082.00
Old:
$5,682,845
$0.18
house, 3 bedroom
66
$19.45
$18.21
$986.04
$26.26
$21.01
286
$18,024.86
0.1%
$0.22
house, 4 bedroom
6
$23.36
$21.87
$107.64
$31.54
$25.23
26
$1,968.10
New:
$7,663,316
$0.26
297
Subtotal:
$3,489.02
Subtotal:
$63,798.70
$60,309.67
0.8%
Wastewater
10%
(not incl. infrastructure repl. chg.)
20%
(on total charge)
house, 1 bedroom
100
$9.73
$9.20
$640.80
$12.16
$9.73
433
$12,636.67
$0.08
house, 2 bedroom
123
$12.97
$12.26
$1,050.91
$16.21
$12.97
533
$20,735.83
Old:
$6,079,083
$0.10
house, 3 bedroom
68
$16.21
$15.32
$726.24
$20.27
$16.22
295
$14,351.16
0.0%
$0.13
house, 4 bedroom
6
$19.46
$17.93
$110.02
$24.32
$19.46
26
$1,517.57
New:
$7,615,375
$0.16
297
Subtotal:
$2,527.97
Subtotal:
$49,241.23
$46,713.26
0.6%
Notes:
*Out of the 1355 Electric(SHARE Program) discounts, 209 also have water
discounts and 211 have wastewater discounts
Assuming all but 5% of existing SHARE Customers will receive discount
1355 95% 1287
Senior/Fixed Income Program Discounts
qqRty
Refuse
(38 gallon)
(20 gallon)
0 $19.12
0 $13.01
0
Water
$0.00
Total Utility
Total
apartment, 1 bedroom
Revenue. Old
# of Old Annual
Proposed Estimated # Est. Revenue
Net Increase Total % Loss. Approximate
Customers Discount Revenue
New rates Proposed Discounted of Eligible Loss w/ New
in Revenue New Total % Amount on
w/discount* Old Rates Rate Loss
(May 2004) Discount Rate Customers Discount Shown
Loss Loss New Rate
0 $19.12
0 $13.01
0
Water
$0.00
$19.64
$8.24
apartment, 1 bedroom
0
$11.60
$0.00
apartment, 2 bedroom
0
$13.91
repl. chg.)
apartment, 3 bedroom
0
$16.69
$13.91
house, 1 bedroom
0
$13.51
$0.00
house, 2 bedroom
0
$16.22
$18.24
house, 3 bedroom
0
$19.45
$19.45
house, 4 bedroom
0
$23.36
$0.00
$31.54
0
$0.00
Wastewater
repl. chg.)
$9.73
$0.00
house, 1 bedroom
0
$9.73
$16.21
house, 2 bedroom
0
$12.97
$19.46
house, 3 bedroom
0
$16.21
house, 4 bedroom
0
$19.46
0
$10.30
$0.00
$19.64
$8.24
$0.00
$13.36
Subtotal:
$0.00
Old: $5,682,845
0% (not
incl. infrastructure
repl. chg.)
$11.60
$0.00
$15.66
$13.91
$0.00
$18.78
$16.69
$0.00
$22.53
$13.51
$0.00
$18.24
$16.22
$0.00
$21.90
$19.45
$0.00
$26.26
$23.36
$0.00
$31.54
Subtotal:
$0.00
0% (not incl. infrastructure
repl. chg.)
$9.73
$0.00
$12.16
$12.97
$0.00
$16.21
$16.21
$0.00
$20.27
$19.46
$0.00
$24.32
Subtotal: $0.00
Notes:
*130 existing Electric Sr./Fixed Income customers; proposed new program for these utilities.
Assuming all existing electric Sr/Fixed income customers will receive discount
130 100% 130
10% $17.68
10% $12.02
10% (on total charge)
$14.09
$16.90
$20.28
$16.42
$19.71
$23.63
$28.39
10% (on total charge)
$10.94
$14.59
$18.24
$21.89
93
37
Subtotal:
34
21
1
10
33
29
3
Subtotal:
44
54
30
3
Subtotal
$2,191.82
593.18
$2,785.01
$638.93
$473.26
$27.04
$218.88
$867.24
$913.85
113.54
$3,252.73
$642.05
$1,050.41
$729.72
87.55
$2,509.73
$ 7,021,800 $0.01
0.0% $0.01
$2,785.01 0.0%
$0.00
Old: $6,079,083 $0.01
0.0% $0.01
New: $7,615,375 $0.01
$2,509.73 0.0%
$0.01
$0.01
$0.01
$0.01
Old: $5,682,845
$0.01
0.0%
$0.01
New: $7,663,316
$0.01
$3,252.73 0.0%
$0.00
Old: $6,079,083 $0.01
0.0% $0.01
New: $7,615,375 $0.01
$2,509.73 0.0%
)EN"r..")
14A
Pl!;tll
May 14, 2004
Mr. Richard C. Prima, Jr.
Public Works Director
City of Lodi — Public Works Department
221 West Pine Street
Post Office Box 3006
Lodi, CA 95241-1910
Re: Utility Discounts
Dear Mr. Prima
EItem I-3
Central Valley Waste Services, Inc.
A WASTE MANAGEMENT COMPANY
1333 E, Turner Road
P.O. Box 241(1)1
Lodi, California 952.31.9501
(209) 369-8274
(2091369.6894 Fax
Thank you for the information and discussion regarding Staff s proposal to the Lodi City
Council on the Utility Discounts.
Central Valley Waste Services supports Staffs proposal regarding the 30% Share
Program Discount and the 10% Senior/Fixed Income Program Discount.
If you have questions please call me at (209) 333-5611.
Sincerely
L ana A. Pinasco
District Manager
Central Valley Waste Services
cc.: Mr. Alex Oseguera, Sacramento Market Area Manager/WM
ORDINANCE NO.
AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
LODI AMENDING CHAPTER 13.04 OF THE LODI MUNICIPAL CODE BY
REPEALING AND REENACTING SECTION 13.04.130, RELATING TO
LOW-INCOME ADJUSTMENTS
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LODI AS FOLLOWS:
SECTION 1. Chapter 13.04 — "Service Generally" - is hereby amended by repealing and
reenacting §13.04.130, relating to low-income adjustments to read as follows:
13.04.130 Low Income Adjustments.
The rates for residential water, sewer, and refuse collection service as
they now exist or may hereafter be modified under this chapter, shall be
reduced as established by resolution for those residential accounts in the
names of persons meeting the eligibility criteria for applicable electric
service discounts as provided in this Title. Proof of eligibility may be
required by the city to qualify for the rate adjustments provided herein.
SECTION 2. This ordinance is adopted as an urgency ordinance under Government
Code §36934 based on health, safety, and welfare considerations arising from: (1) the
City of Lodi's consideration of increased utility rates if adopted take effect prior to the
City's ability to institute the low-income discounts considered herein; (2) If the increases
are adopted prior to institution of the discounts, Lodi's low-income community may suffer
financial hardship or inability to afford critical health and sanitary services.
SECTION 3. All ordinances and parts of ordinances in conflict herewith are repealed
insofar as such conflict may exist.
SECTION 4. This ordinance shall be published one time in the "Lodi News -Sentinel," a
daily newspaper of general circulation printed and published in the City of Lodi and shall
be in force and take effect immediately after its passage and approval.
Approved this 2nd day of June, 2004
LARRY D. HANSEN
Mayor
Attest:
SUSAN J. BLACKSTON
City Clerk
State of California
County of San Joaquin, ss.
I, Susan J. Blackston, City Clerk of the City of Lodi, do hereby certify that Ordinance
No. was adopted as an urgency ordinance at a regular meeting of the City Council
of the City of Lodi held June 2, 2004, and was thereafter passed, adopted, and ordered to
print by the following vote:
AYES: COUNCIL MEMBERS -
NOES: COUNCIL MEMBERS -
ABSENT: COUNCIL MEMBERS -
ABSTAIN: COUNCIL MEMBERS -
I further certify that Ordinance No. was approved and signed by the Mayor on the
date of its passage and the same has been published pursuant to law.
SUSAN J. BLACKSTON
City Clerk
Approved as to Form:
D. STEPHEN SCHWABAUER
Interim City Attorney
RESOLUTION NO. 2004-
A RESOLUTION OF THE LODI CITY COUNCIL
ESTABLISHING LOW-INCOME DISCOUNTS FOR
WATER, SEWER, AND REFUSE SERVICES
WHEREAS, with the implementation of new rates adopted April 27, 2004, to be effective
May 3, 2004, the Lodi City Council has amended Lodi Municipal Code Chapter 13.04,
§13.04.130, "Low Income Adjustments," by adopting an urgency ordinance at its June 2, 2004
City Council meeting; and
WHEREAS, the City Council now desires to adopt a resolution establishing discounts for
eligible low-income residents.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby approve
and establish low-income discounts for water, sewer, and refuse services as shown below:
For Residential Customers who qualify for the Electric SHARE Program discount:
Water 20% Discount on the Residential Flat Rate
Wastewater 20% Discount on the Residential Flat Rate for Disposal
to the Domestic System
Refuse 30% Discount for Cart Service Categories 1, 2, 3, 4, and 5
OR,
For Residential Customers who qualify for the Electric Senior/Fixed-Income discount:
Water 10% Discount on the Residential Flat Rate
Wastewater 10% Discount on the Residential Flat Rate for Disposal
to the Domestic System
Refuse 10% Discount for Cart Service Categories 1, 2, 3, 4, and 5
Dated: June 2, 2004
-----------------------
-----------------------
I hereby certify that Resolution No. 2004- was passed and adopted by the City
Council of the City of Lodi at its regular meeting held June 2, 2004, by the following vote:
AYES: COUNCIL MEMBERS —
NOES: COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
SUSAN J. BLACKSTON
City Clerk
2004-