FOR: Utilities Commission Meeting [April 16, 2024]
TO: Honorable Chairperson and Commission
APPROVAL: Stephen Dopudja, P.E., Interim Utilities Manager
Toyasha Sebbag, Assistant to the City Manager
...Title
Water and Wastewater Rate Study Presentation.
RECOMMENDATION
Request that the Utilities Commission receive and file the Water and Wastewater Rate Model. (ACTION)
...Body
BACKGROUND
The agenda includes a discussion and presentation during the meeting by F.G. Solutions, the City's Water and Wastewater Consultant, regarding the proposed water and wastewater rate model.
ANALYSIS/DISCUSSION
At the February 27, 2024, City Council Meeting staff requested that the item pertaining to a public hearing under Proposition 218 to adjust water and wastewater rates be tabled until a future date to be determined. It was further explained that City staff would bring back for City Council consideration to set a new public hearing with new and proper 218 notification materials.
Subsequently, staff requested a 2023 Water and Wastewater Rate Study Amendment 1 (ATTACHMENT 1) to a professional services agreement with FG Solutions, LLC with a timeline to update rate calculations with rates effective January 1, 2025, 2026, 2027, 2028, and 2029. Below is the proposed milestone schedule:
|
Proposed Milestones |
Date |
|
Notice to Proceed |
03/08/2024 |
|
Draft Rate Proposal to City Staff |
03/26/2024 |
|
Water Subcommittee Meeting |
03/27/2024 |
|
Attend Various Meetings |
TBD |
|
Final Rate Proposal Developed |
04/09/2024 |
|
Utilities Commission Meeting |
04/16/2024 |
|
Council Sets Proposition 218 Hearing |
04/23/2024 |
|
Preliminary Draft Report Delivered |
05/16/2024 |
|
Final Draft Report Delivered |
05/31/2024 |
|
Proposition 218 Public Hearing |
06/25/2024 |
|
1st Rate Adjustment |
01/01/2025 |
On March 26, 2024, the Water Subcommittee provided feedback on the proposed Water and Wastewater Rate Model. On April 23, 2024, staff will recommend that the City Council set a Public Hearing for Water and Wastewater Rates for June 25, 2024.
FINANCIAL IMPACT
Operating Budget
Funds are available in water and wastewater contract services operating accounts, with funds split based on the number of accounts served.
The 2023 Water and Wastewater Rate Study Amendment 1 costs will be split in contract services accounts for water and wastewater as follows:
|
Water with approximately 12,500 (37%) accounts |
$24,291 |
|
Wastewater with approximately 21,470 (63%) accounts |
$41,360 |
|
Amendment 1 Costs |
$65,651 |
The Original Professional Services Agreement (PSA) awarded on April 11, 2023, was for $138,297. The PSA Amendment 1 is for $65,651, bringing the total contract cost to $203,948. Amendment 1 is within the signature authority of the Assistant City Manager because it is for under $100,000 and does not need to be returned to the City Council for authorization.
Capital Improvement Budget
The proposed action will not impact the Capital Improvement Budget.