HomeMy WebLinkAboutStudy Session - Public Works Department Report - increase in Page 15 - Council/Agency Minutes- 6/5/95
A motion was made by Green, second Garofalo to accept the one year Ambulance Report-with
net revenues of $287,519 and to direct staff to place $55,600 into the Ambulance Equipment
Replacement Account and apply $51,895 towards replacement of the General Fund startup
costs. Leaving a General Fund unpaid balance of $396,008. The motion carried by the following
roll call vote:
` �VU
AYES: Harman, Bauer, Sullivan, Green, Garofalo RECEIVED FROM
AND MADE A PART OF THE RECO D A HE
NOES: None COUNCIL MEETING OF
OFFICE OF THE CITY CLERK
ABSENT: Leipzig CONNIE 13ROOKWAY,CITY CLERK t Pc hY
(CITY COUNCIL) WATER MASTER PLAN CAPITAL IMPROVEMENTS FINANCING - PAY-AS-
YOU GO FINANCING PLAN -APPROVED (1000.50)
The City Clerk earlier in the meeting had announced the following late communication:
Communication from William Holman, Seacliff Partners Project Manager, dated June 5, 1995, in
regard to the Water Master Plan Capital Improvements Financing.
The City Clerk presented a communication from Director of Public Works regarding the 1995
Water Master Plan which identifies necessary capital improvements with an estimated cost of
$42.9 million. Two separate charges are recommended to finance the projects and the proposed
fees require adoption by ordinance and resolution through the public hearing process.
The Director of Public Works presented a detailed report and presented slides. Discussion was
held regarding the plan.
William R. Everest, Boyle Engineering, reported.
Discussion was held.
A motion was made by Dettloff, second Green to approve the following recommended actions:
(1) . Approve the Water Task Force recommendation to utilize the Pay-As-You-Go financing
plan when the Monthly Capital Surcharge is implemented.
(2) Approve the Water Task Force recommendation of an increased Capital Facilities Charge
for new residential development as presented in the Task Force Report.
(3) Direct staff to prepare the necessary ordinances and resolutions to implement the Monthly
Capital Surcharge and the increased Capital Facilities Charge. I
(4) Accept the proposed public hearing schedule related to the charges.
The motion carried by the following roll call vote: i
AYES: Harman, Bauer, Dettloff, Green, Garofalo
NOES: Sullivan
ABSENT: Leipzig
295
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF HUNTINGTON BEACH
ADJUSTING WATER RATES RELATING TO SECTION 14.12.040 OF
THE HUNTINGTON BEACH MUNICIPAL CODE
WHEREAS, pursuant to Huntington Beach Municipal Code, Section 14.12.045,the City Council
shall adjust water rates in order to maintain a balanced budget;
NOW, THEREFORE,BE IT RESOLVED by the City Council of the City of Huntington Beach
as follows:
Effective December 1, 1995,water customers shall pay a minimum charge based upon size of
service,plus $0.88 per 100 cubic feet of water, per month, for domestic, commercial and
industrial service.
The minimum charges shall be:
Size of Service Minimum Charge Per Month
5/8"or 3/4" $ 5.30
1" $ 10.60
1 1/2" $ 15.90
2" $26.50
3 $58.30
4"Compound $ 90.10
4"FM $174.90
6"Compound $174.90
6"FM $355.10
8"FM $620.00
water/jmm/9/13/95
6/� l' Cod • jja, )Ora'
:
Council/Agency Meeting Held: � 95
Deferred/Continued to: �� —
I-IfApproved O Conditionally Approved ❑ Denied City Clerk's Signqofe
Council Meeting Date: June 5, 1995 Department ID Number: PW-95-041
REQUEST FOR COUNCIL ACTION
SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS
SUBMITTED BY: MICHAEL T. UBERUAGA, City Administrato
PREPARED BY: LES M. JONES, II, Director of Public Works
SUBJECT: Water Master Plan Capital Improvements Financing
Statement of Issue,Funding Source,Recommended Action,Alternative Action,Analysis,Environmental Status,Attachment(s)
Statement of Issue: The 1995 Water Master Plan identifies necessary capital
improvements with an estimated cost of $42.9 million. Two separate charges are
recommended to finance the projects. The proposed fees require adoption by ordinance
and resolution through the public hearing process.
Funding Source: Funding will be provided through a Monthly Capital Surcharge on the
Municipal Services bill; and an increased Capital Facilities Charge for new residential
development .
Recommended Action:
1. Approve the Water Task Force recommendation to utilize the Pay-As-You-Go financing
plan when the Monthly Capital Surcharge is implemented.
2. Approve the Water Task Force recommendation of an increased Capital Facilities
Charge for new residential development as presented in the Task Force Report
3. Direct staff to prepare the necessary ordinances and resolutions to implement the
Monthly Capital Surcharge and the increased Capital Facilities Charge.
4. Accept the proposed public hearing schedule related to the charges.
Alternative Action(s):
1. Approve an alternative financing method.
2. Direct revisions to the proposed public hearing schedule.
3. Do not implement a financing plan for the water capital improvements. Construction will
be deferred until a funding method is determined.
dV
RtQUEST FOR COUNCIL ACTION
MEETING DATE: June 5, 1995 DEPARTMENT ID NUMBER:PW-95-041
Analysis: In December 1993, the Water Task Force was appointed by Council to review
the updated 1988 Water Master Plan, and evaluate financing options. In March 1995, the
Water Task Force presented its report to the City Council. The report included a prioritized
project list, eleven year construction schedule and a recommended financing plan.
The financing plan consists of two elements: 1) a new Monthly Capital Surcharge for all
water customers; and, 2) an increased Capital Facilities Charge for new residential
development. The recommended fee schedule for the Monthly Capital Surcharge provides
revenue concurrent with the project construction phases. The Task Force supports the
"pay-as-you-go" method because it avoids the long term debt and financing costs of bonds
or Certificates of Participation.
Alternative financing options were prepared and presented to the Council, but not
recommended by the Task Force. One option considered financing the improvements over
thirty-five years with Certificates of Participation. Another financing option combined "pay-
as-you-go" and twenty year Certificates of Participation.
Expanding the construction schedule from 11 years to 15 years was suggested as a way to
keep rate costs to a minimum. This approach does not agree with the recommendation of
the Task Force. In addition, it has also been discouraged by the consultant, Boyle
Engineering in a May 16 letter which is attached. If this approach were adopted, however, it
would be first necessary for the consultant to reprioritize and regroup the construction
schedule to a 15 year duration and amend the Master Plan update. Once completed, a pay-
as-you go option could then be developed to finance the new construction schedule.
As an alternative to extending the construction schedule, a modest fee($2.00) may be
implemented in 1995 with the construction schedule delayed to begin until 1998. This would
expand the funding schedule but maintain the 11 year construction schedule. Delaying start
of the construction would allow impounding of the initial funding which would produce a
lower initial rate. It would also increase the risks associated with further delay of the
construction as explained in the Boyle letter and the recommendation of the Task Force.
The increased Capital Facilities Charge will be assessed to new residential developments.
The charge is calculated by the number of "equivalent dwelling units" served. The formula
includes the value of the existing water system and the cost of future capital needs. This fee
change requires modification of Municipal Code Section 14.12.010. The Task Force
recommends prompt implementation of the Capital Facilities Charge.
A rate increase to meet the operational expenses of the Water Enterprise will be presented
with the 1995/96 Budget, and adopted concurrent with the budget. The Monthly Capital
Surcharge can be included in the water rate adjustment resolution, or a separate public
hearing can be arranged after October 1, 1995. A proposed schedule is attached.
Environmental Status: Not applicable.
0012284.01 -2- 05/31/95 5:25 PM
RLQUEST FOR COUNCIL ACTION
MEETING DATE: June 5, 1995 DEPARTMENT ID NUMBER:PW-95-041
Attachment(s):
City Clerk's
Page Number Proposed Public Hearing Schedule
2 Capital Facilities Charge
3 Standard Connection Fees
4 Comparison of Financing Options; Source of Funding
5 Letter from Boyle Engineering re: Extension of Construction Schedule
6 Memorandum from Councilmember Garofalo re:Financing Alternatives
0012284.01 -3- 05/31/95 5:25 PM
REQUEST FOR COUNCIL ACTION
MEETING DATE: June 5, 1995 DEPARTMENT ID NUMBER:PW-95-041
Proposed Implementation and Public Hearing Schedule
August 7, 1995 Introduction of Ordinance to modify Capital Facilities Charge
August 14, 1995 Budget Study Session. Operational water rate increase
included with the proposed 1995196 Water Fund budget.
Council to provide direction for Monthly Capital Surcharge
implementation, either with 1995/96 Budget or separately.
August 21, 1995 Adoption of Ordinance to modify Capital Facilities Charge
(Public Hearing) Adoption of Resolution to increase Capital Facilities Charge
Requires 45 day notification; new charge effective 9/21/95.
September 5, 1995 Operations & Maintenance water rate increase to be adopted
(Public Hearing) with the 1995/96 budget.
September 18, 1995 Adoption of 1995/96 Budget resolution and water rate increase
resolution.
Additional public hearings for the Monthly Capital Surcharge may be scheduled per Council
direction.
0012284.01 -4- 05/31/95 5:25 PM
CAPITAL FACILITIES CHARGE
METER FLOW CAPACITY EQUIVALENT CAPITAL
SIZE (gallons per DWELLING FACILITIES
inches minute) UNITS CHARGE
3/4 30 1 $ 2,400
1 50 2 4,800
1 -1 /2 100 3 7,200
2 160 5 12,000
3 320 11 26,400
4 500 17 40,800
6 1000 33 79,200
Compound
6 1400 47 112,800
Fire Meter
8 2400 80 192,000
Fire Meter
10 3800 127 304,800
Fire Meter
05/18/95
STANDARD CONNECTION FEES
City 3/4-Inch Meter 1-Inch Meter 2-Inch Meter 6-Inch Meter 6-Inch Fire Service
Anaheim
Carlos Bustos $2,305.00* $2,355.00* $2,620.00* $2,710.00* Not Available
(714) 254-4231
Costa Mesa (MCWD) $1,200.00 $1,300.00 $6,600.00 Over 3" based on
Ron Briles usage x $4.90
'714) 631-1291
Fountain Valley $304.02 $507.07 $1,622.21 $10,142.37 Not Available
Romero Alvarez
(714) 965-4433 x250
Garden Grove
Marion Dan $585.00 $615.00 $1,800.00 $7,500.00 Not Available
(714) 741-5396 $17.55** $18.45** $54.00** $225.00**
Irvine Ranch Water Dist.
Janet [ray Fees based on area of development/density.
(714) 453-5300 Range $400.00 (low density) to $12,000 (high density)
'.aguna Beach Water Dist.
iom Eastman $500.00 $500.00 $1,000.00 Not Available
(714) 494-1041 $250.00 (meter) $300.00 (meter) $600.00 (meter)
Los Alisos Water Dist.
Phyllis Cottingham $1,100.00 + $1,100 + $1,100 +
(714) 830-0580 $ 80.00 (meter) $120.00 (meter) $340.00 (meter) Not Available Not Available
Moulton Niguel
Carlo Habash $1,400.00 (all sizes for Laguna Niguel)(water and sewer combined)
(714) 643-2584 $1 ,200.00 (all sizes for Mission Viejo, Laguna Hills, etc)
Standard Connection Fees
Page 2
City 3/4-Inch Meter 1-Inch Meter 2-Inch Meter 6-Inch Meter 6-Inch Fire Service
Newport Beach (City) $195.00 $260.00 $605.00 $2,805.00 $2,850.00
Sheila O'Brian
(714) 644-3141
Santa Ana (City) $735.00 $760.00 $1,510.00 Not Available $5,258 to $5,800
Tai Koon (Dependant on location)
1714) 647-5837
Santa Margarita (WD) $1,200.00 (all sizes)(Rancho Santa Margarita, Coto de Caza)
Eddie Bolton $2,600.00 (all sizes)(Mission Viejo)
(714) 582-2330 $116.00 (meter) $172.00 (meter) $829.O0(meter) Not Available Not Available
Westminster (City)
Huyen Nguyen $1 ,560.00+ $1,560.00+ $1,560.00+ $3,450.00+ $4,700.00
(714) 898-3311 material material material material
• Includes $2,225.00 Assessment Fee Compiled by: Janie Alba
`•Processing Fee 5/19195
COMPARISON OF FINANCING OPTIONS
SOURCE OF FUNDING
PLAN PAY AS YOU GO I BONDS TOTAL TERM OF BONDS
$ 55 Million 0 $55 Million Not Applicable
• • $ 4 Million $51 Million $55 Million 30 Years
$ 33 Million $22 Million $55 Million 20 Years
Description of Financing Options
"Pay as You Go"
This plan uses a maximum rate increase of $5.50 per month per residential meter to
pay for all construction costs within an eleven year period of time. An initial rate
increase of $3.00 per month in 1995 is increased annually by 50 cents per month to
the maximum of $5.50 in 1999/2000, then drops to $2.00 per month in fiscal year
2005/2006.
Bonds/COP's
Bonds/COP's would result in payment for the facilities with three separate 30 year
bond issues compared to the eleven year financing of the " Pay As You Go" Plan
(Construction of the improvements would be on the same eleven year schedule,
however). Residential monthly rate increases would be $1.50 in 1996, increased
progressively to $5.00 in 2003. The $5.00 rate would continue until the first bond
issue is retired in 2026. New connection fees would be the same as the " Pay As
You Go" Plan.
Alternative
Same construction schedule as above plans. Two separate 20 year bond issues
would be issued in combination with ° Pay As You Go" financing. Residential
monthly rate increases would be $1.90 in 1995, increased progressively to $5.50 in
fiscal year 2001/2002. The $5.50 rate would drop to $4.00 in fiscal year 2005/2006
and continue at $4.00 until the first bond issue is retired in 2016.
See Attached Graph summarizing monthly rates.
0011549.01 04120/95 4:07 PM
Comparison of Financing Options
Monthly Capital Surcharge Requirements
BondsICOP's
v55 _....._............_._.._.. .......... .......... _._............................._........
`m
t
u
rn Alternativ mbination
9
U
T
o "Pay as You Go"
$0
94 95 96 97 98 99 00 01 02 03 04 05 M 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32
Fiscal Year
Capital Projects Fee -Alternative Financing Plans
Fiscal Monthly Rate($)
Year Pay as You Go BondsICOP's Alternative
1994 $0.00 $0.00 $0.00
1995 $3.00 $0.00 $1.90
1996 $3.50 $1.50 $2.25
1997 $4.00 $1.50 $3.00
1998 $4.50 $1.50 $3.35
1999 $5.00 $2.50 $3.65
2000 $5.50 $2.50 $4.00
2001 $5.50 $2.60 $5.00
2002 $5.50 $4.00 $5.50
2003 $6.50 $5.00 $5.50
2004 $5.50 $5.00 $5.50
2005 $5.50 $5.00 $5.60
2006 $2.00 $5.00 $4.00
- 2007 $2.00 $5.00 $4.00
2008 $2.00 $5.00 $4.00
2009 $2.00 $5.00 $4.00
2010 $2.00 $5.00 $4.00
2011 $2.00 $5.00 $4.00
2012 $2.00 $5.00 $4.00
2013 $2.00 $5.00 $4.00
2014 $2.00 $5.00 $4.00
2016 $2.00 $5.00 $4.00
2016 $2.00 $5.00 $3.00
2017 $2.00 $5.00 $3.00
2018 $2.00 $6.00 $3.00
2019 $2.00 $5.00 $3.00
2020 $2.00 $5.00 $2.00
2021 $2.00 $5.00 $2.00
2022 $2.00 $5.00 $2.00
2023 $2.00 $6.00 $2.00
2024 $2.00 $6.00 $2.00
2025 $2.00 $5.00 $2.00
2026 $2.00 $4.00 $2.00
2027 $2.00 $4.00 $2.00
2028 $2.00 $4.00 $2.00
2029 $2.00 $3.00 $2.00
2030 $2.00 $3.00 $2.00
2031 $2.00 $3.00 $2.00
2032 1 $2.00 1 $2.00 1 $2.00
FEECOMP.XLS 4120195
BoLpe Enqineerinq Corporation consumno engineers ! arcnrtects
1501 Quail street
P.O. Boh 3030 714 / 476-3300
Newport Beach. CA 92658.9020 FAX 714 / 721 7142
Mr. Les Jones, Director of Public Works May 16, 1995
CITY OF HUNTINGTON BEACH
Post Office Box 190
Huntington Beach, California 92648
Water System Master Plan/Financing Plan
Capital Improvement Program -Implementation Period
Since 1987 when Boyle initially became involved with the Water System Master Plan, the
construction period for the recommended program has changed. In our 1988 Master Plan we
recommended the CIP be implemented over a six-year period,based on a realistic engineering
construction period, which was the basis of the CIP until 1993. During the last two years, the
implementation period has been extended to 11 years, based on the desire and need to minimize
the financial impact of the program. It was felt that this extended duration was acceptable, even
though there was some increased risk to public safety because of seismic damage vulnerability.
Structural retrofit improvements to existing city reservoirs are required for the facilities to
successfully withstand a major earthquake. In addition,the city has no emergency water storage,
which would be invaluable following a major earthquake.
It has been recently suggested that the CIP implementation period be further extended, say to 15
years. We believe that such an extension would: 1) be more characteristic of a long-term
maintenance program rather than a critically-needed capital improvement program,2) unduly
increase the public safety risk in the city, and 3) not significantly reduce the financial impact of
the program.
East Bay Municipal Utility District in Oakland is undertaking a major water system seismic
upgrading program. Because of public concern for the immediacy of providing protection, the
District voted to have the program completed in 10 years rather than 15 as originally proposed.
Similar action is justified in Huntington Beach.
We cannot recommend nor support an extension of the CIP beyond 11 years, which is the basis
for our recently adopted 1995 Update.
Boy a En ineering Corporation
William R. Everest,
I } Principal Engineer L-\-
cc: Jeff Renna- Water Operations Manager
OC-H 10-250.20/joncs.oMht
CITY OF HUNTINGTON BEACH
INTER-DEPARTMENT COMMUNICATION
HUNTINGTON BEACH
TO: CITY COUNCIL
FROM: LES M. JONES II
Director of Public Works
DATE: MAY 22, 1995
SUBJECT: 1995 WATER MASTER PLAN
OPERATION AND MAINTENANCE COSTS
At the Council Study Session on May 8, 1995, a question was
raised regarding the $2 . 00 per month operation and maintenance fee
that would be assessed at the conclusion of the payoff of the
capital projects in all financing proposals presented. The
information below should answer this question.
QUESTION: How does the $2 . 00 per month fee for operation and
maintenance compare to the current cost of operation and
maintenance based on the current year' s budget?
ANSWER: The $2. 00 fee compares favorably, as it is based on the
current year budget costs for the operation and maintenance of
similar facilities .
In Table 8 of the "Water System Master Plan/Financing Plan -
1995 Update, " dated March, 1995, page 22, the total annual O & M
cost for all the proposed facilities is shown to be $1 . 632 million
(estimated in 1995 dollars) . This figure represents what the
annual 0 & M cost would be for these facilities if they were
currently in operation, having just been completed. The estimated
1995 0 & M cost of $1 .632 million is based on the current average
costs for operating similar facilities in the existing Huntington
Beach water system, in addition to current maintenance costs.
Since the facilities would be new at the completion of the
construction period, this was taken into account when estimating
these costs, as initial year O & M efforts are typically lower than
in later years. Additionally, annual depreciation costs are
included in the estimates . When compared against the existing
water system' s 20+ year old facilities, the actual costs for the
existing facilities are currently on the order of 50% higher.
In determining the $2 . 00 per month O & M fee shown in the 1995
Water Master Plan proposal, the $1 . 632 million 0 & M cost estimate
was divided by the estimated 72, 900 equivalent dwelling units (EDU)
estimated to exist in the years following the construction period.
The numbers of EDU' s are shown in Tables 16, 17, and 18 in the 1995
Water Master Plan document (see pages 35, 36, and 37 on the first
line entitled, "Customer Data") . Dividing the $1 . 632 million by
72, 900 EDU' s yields approximately $24 per year, or $2 . 00 per month.
If you should have any additional questions or need more
clarification, please contact me.
LMJ: jr
cc: Michael T. Uberuaga, City Administrator
Ray Silver, Ass' t . City Administrator
I. Nt4 CITY OF HUNTINGTON BEACH
CITY COUNCIL COMMUNICATION
HU NGTOH 8UC
TO: Michael T. Uberuaga, City Administrator
FROM: Dave Garofalo, City Council Member
DATE: May 26, 1995
SUBJECT: WATER CAPITAL IMPROVEMENTS FINANCING
As we discussed, I am concerned over several rate increases this Council will be acting
on yet this year. One is clearly in the area of"Water" and another in "Refuse
Collection". There will probably be yet others as we attempt to manage in the 1990's.
Water Department - I would like to request that your staff prepare an alternative
financing and improvement program that utilizes a pay-as-you-go approach with the
rates being incrementally increased in a manner necessary to finance a phased
implementation of the acknowledged necessary capital improvements.
Specifically, there is no reason this eleven year program could not be a 15 year plan.
We build and pay-as-we-go for one third at a time. In fact, if we were to immediately
institute a new$2.00 per month fee on the water bill and did so for 36 months, we
would then have accumulated over$3 million. That would be pay-as-you-go then
stating construction and payment for one third of the project over three, five year
periods.-While this may be longer, in my opinion it is more affordable. I believe we will
have several major capital projects that need to be looked at and instead of ignoring
and delaying, I would rather be responsible for planning and truly paying-as-we-went!
understand that most of this analysis is already available, therefore it should not
require very much additional staff time.
Thank you in advance for your attention to this matter.
DG:paj
xc: Honorable Mayor and City Council
Seacliff Partners
Ajemr.nuua u(Plufic Cnssl noxs and UlY.C.D.volepm:rt Corp. HUr;ru.- -
June 5, 1995
Jiil ti ,
The Honorable Victor Leipzig, Mayor
Huntington Beach City Council
2000 Main Street
Huntington Beach, CA 92648
Subject: Agenda Item F-2; Water Master Plan Capital Improvements Financing
Mayor Leipzig and City Council:
Seacliff Partners has reviewed the materials for the above item and generally supports the
recommendations of the Water Task Force to adopt a financing plan to support citywide water
system improvements, with one major exception.
While we agree that a proposed new Capital Facilities Charge is warranted, we disagree with
the Task Force recommendation that the fees be charged only to new residential development,
with no associated fees for non-residential development. We believe this proposal is unfair for
the following reasons:
Non-residential uses have a significant impact_,_ onnc wide water use
In the 1990 Bartle Wells Associates Water Master Plan Financing Plan Study, the City
reported that 27 percent of all metered water usage in the City was by commercial (i.e. non-
residential) uses. This information is consistent with the water demand factors used by the
City in designing the master plan of water facilities for the Holly Seacliff Area. As indicated
on pages 36-38 of the Holly Seacliff Specific Plan Technical Appendix, non-residential uses
(commercial, industrial, mixed development and open space uses) account for approximately 30
percent of the overall water demand in the area. Developers of non-residential properties
should be required to pay for their fair share of new system improvements
Under the fee schedule as recommended by the Task Force, developers would pay widely
varying capital facilities fees for new development, as shown on the following table indicating
fees applicable to four typical development scenarios on a ten acre site:
Capital
Land Use Demand Factor Total Demand Facilities Charge
60 single family dwellings 1.2 Gal/Min/Acre 12 Gal/Min $144,000
(@ 6 du/ac)
100 townhomes 2.2 Gal/Min/Acre 22 Gal/Min $240,000
(@ 10 du/ac)
Retail (109,000 sf) 1.3 Gal/Min/Acre 13 Gal/Min $ 3,000
(@ 0.25 FAR)
Industrial (178,000 so 3.7 Gal/Min/Acre 37 Gal/Min $ 3,000
(a 0.41 FAR)
U/520 Broadway, Suite 100, Santa Monica, CA 90401 (310) 394-3379 Fax(310) 394-6872
1Y 23 Corporate Plaza, Suite 250, Newport Beach, CA 92660 (714) 721-9777 Fax (714) 729-1214�
06/05/95 15:50 $714 729 1215 CUD PCH HBCO -OL-
As the table illustrates, even though the total water demand from residential development is
lower, the proposed fees are significantly and disproportionately higher for residential
development.
The City's General Plan and Holly Seacliff Specific Plan require the City to charge developers
for public infrastructure improvements on a "fair-share" basis.
The proposed water capital facilities fee, if applicable only to new residential development but
not to non-residential development, does not conform with adopted City policies and
ordinances. Further, if the City does not impose fees on non-residential development in the
Holly Seacliff area to pay for public water system improvements financed and constructed by
Seacliff Partners, the City is not using its best efforts to obtain maximum reimbursements for
Seacliff Partners, as required by the terms of Development Agreement No. 90-1.
We respectfully request the City Council to address these issues prior to adoption of the Water
Master Plan and Capital Improvements Financing Plan.
Sincerely,
William D. Holman
Project Manager
cc: Michael Uberuaga, City Administrator
Les Jones, Public Works Director
Gail Hutton, City Attorney
Connie Brockway, City Clerk
Melanie Fallon, Community Development Director
Tom Zanic
RCA ROUTING SHEET
INITIATING DEPARTMENT: Public Works
SUBJECT: Water Capital Improvements Financing
COUNCIL MEETING DATE: June 5, 1995
RCA ATTACHMENTS STATUS
Ordinance (w/exhibits & legislative draft if applicable) Not Applicable
Resolution (w/exhibits & legislative draft if applicable) Not Applicable
Tract Map, Location Map and/or other Exhibits Not Applicable
Contract/Agreement (w/exhibits if applicable)
(Signed in full by the City Attorney) Not Applicable
Subleases, Third Party Agreements, etc.
(Appoved as to form by City Attorneyj Not Applicable
Certificates of Insurance (Approved by the City Attorney) Not Applicable
Financial Impact Statement (Unbudget, over $5,000) Not Applicable
Bonds (If applicable) Not Applicable
Staff Report (If applicable) Not Applicable
Commission, Board or Committee Report (If applicable) Not Applicable
Findings/Conditions for Approval and/or Denial Not Applicable
EXPLANATION FOR MISSING ATTACHMENTS
REVIEWS''D RETURNED FOR DED
Administrative Staff
Assistant City Administrator Initial
City Administrator Initial
City Clerk
EXPLANATION FOR RETURN.OF ITEM:
. . Only)
k11i�C tAOM w
dNF1MAbEAPAR v P
TOFT{i1 EF._.T
�!E COUNOIL MEETING OF
dPFIBE OF THE C
cC) ITYCLEgK(S
NNfE BF?OOKWAY C17YCLEIJK
Water Master Plan
Task Force Report
Council Update
5/8/95
Master Plan Improvements
Total Cost: $42.9 Million
*Add new water supplies
*Increase water storage capacity
*Improve delivery system
* Protect public health & safety
Water Task Force Report
Council Actions 4/27/95
♦ Acceptedar..
✓ Prioritized project list
✓ 1 1 yr construction schedule
✓ Increased Capital Facilities Charge for new
residential development
♦ Requested further information
✓ Emergency storage needs
✓Alternative financing plan with lower
initial rate & shorter bond term
Water Task Force Report
Council Update 5/8/95
♦Amount of Emergency Water Storage
✓ Comparable to other agencies
✓ Realistic to meet anticipated need
♦ Financing Alternative with Lower
Initial Rate & Shorter Bond Term
✓ Combines 20 yr COPS & Pay As You Go
✓ Lower initial rate; higher long term costs
Emergency Water Storage
W[iN.i^.NK%
A encv # of av2 days
Anaheim 4.9
Brea 7
Fullerton 1.4
Garden Grove 0.85
Moulton Niguel Water District 0.56
South Coast Water District 2.3
Yorba Linda Water District 1.2
Water Task Force
Financing Alternative
to
Pay As You Go
Monthly Surcharge
(Residential 3/4" Meter)
Method Term Initial Maximum
Rate Rate
Pay As You Go 11 Yr $3.00 $5.50
Bonds/COPS 30 Yr $1 .50 $5.00
Alternative/ 20 Yr $1 .90 $5.50
Combination
Monthly Rate Increase
Alternative Financing Methods
..:.:....:..:.:...
$6
Pay as You Go
$5
Alternative
$4
$3
$2
Bonds/COP'
$'I
$0
94 96 93 0 2 4 6 6 10 12 14 16 16 20 22 24 26 26 30 32
Fiscal Year
Cost per Residence
(3/4" Meter)
Method 1 st yr Full Cost
1995 2031
Pay As You Go $36 $ 1 ,284
COPS $ 0 $ 1 ,848
Alternative $23 $ 1 ,478
Full Cost per Residence
1995-2031
aeuuxaa•::uazuu wxx
$2,000
$1,800
$1,600 T
$1,200 - 's
Total New Revenue: 1995-2031
Alternative Financing Methods
New Revenue to Finance Water Master Plan
Total Net
Revenue Present Value
Pay as You Go $ 144. 5 $65.0
Bonds/COP's $214.7 $67.6
Alternative $ 172.9 $67.8
.S in Millions
Total New Revenue: 1995-2031
Alternative Financing Methods
S in Millions ®Total
$200 $172.9 ®NPV
$144.5
$150
$100 67.6 67.8 65.0
$50
$0
Bonds Alternative Pay as You Go
NPV-Net Present Value
Water Task Force
Recommendation
♦Support Pay As You Go Financing
✓ Lowest total costs
✓Avoids long term debt
✓ Retains bonding option
♦Support Capital Facilities Charge
✓ Pays for existing system & new demands
✓ On new residential development
Huntington Beach Municipal Code 14.12.010-14.12.010(d)
Chapter 14.12
FEES,RATES AND DEPOSITS
(674-12/57.723-6159.7 3 8-1 215 9,7514160,792-10/60.892-4/62, 1001-10/63. 1100.12/64, 1217-7/66,Urg 1343-A-8/67, 1344-9/67,
19014174. 1996-8175,2020-12175,2022-1/76,2205-7177,2218-11177.2400-11/79,2535-3/82,2589-1/83.2709-6/84,2826-5/86,
2948.8/88,3119-7/91,3302-11/95.3404-10/98)
Sections:
14.12.010 Service fee
14.12.020 Installation and meter fees
14.12.030 Installation by applicant
14.12.040 Water rates--Designated
14.12.045 Water rates--Budget
14.12.050 Water rates--Construction purposes
14.12.060 Water rates--Other usds
14.12.070 Private fire service rates
14.12.080 (Repealed Urg Ord 2709-6/84)
14.12.090 Water service--Applications
14.12.100 Water service--Turn-on charges
14.12.110 Water rates--Turn on
14.12.120 Water billing
14.12.130 Vacating premises
14.12.140 Change of address
14.12.150 Renewing service
14.12.160 Adjustment of rates
14.12.170 Water fund
14.12.010 Service fee. For uses zoned commercial or industrial,the Water Department, as a
condition to granting the application and furnishing water service to the premises, is authorized
to charge and shall collect in advance the following sums for the purpose of reimbursing the City
for the cost of the system and future replacements and extensions thereof (3302-11/95)
(a) The sum of sixty dollars($60) for each usable unit on parcels containing less than ten i
thousand (10,000) square feet.
A "usable unit' shall be each residential quarter in hotels and motels. (3302-11/95)
b( ) For any parcel containing ten thousand(10,000) square feet of area or more,three hundred
dollars ($300)per acre or fraction thereof,or sixty dollars ($60)per usable unit,whichever is
greater. (3302-11/95) -
A "usable unit" shall be any unit defined in subsection(a) above. The charge,of three
hundred dollars($300)per acre shall apply to all commercial and manufacturing
developments. (3302-11195)
(c) Those areas served by a water main constructed and charged as determined by another
ordinance or executed agreement may be exempt from the usable unit charge in subsection
(a) if said other ordinance or agreement charge is greater than the charge per subsection(a).
(3302-11/95)
(d) All necessary service fees established.by the City shall be deposited with the City prior to
approval of the final subdivision map or issuance of a building permit if a subdivision map is,
not required. (674-12/57,723-6/69,1001-10/63,1100-12/64,2022-1776,2535-3/82). ,
For uses zoned other than commercial or industrial,the Water Department,as a condition to
granting the application and furnishing water service to the premises,is authorized to charge
10198
14.12.010(d)--14.12.045 Huntington Beach Municipal Code
and shall collect in advance the Capital Facilities Charge for the purpose of reimbursing the
City for the cost of the rystem and future replacements and extensions thereof. The Capital
Facilities Charge is based on the cost per equivalent dwelling unit(EDU) of existing facilities
and the proposed expansion facilities which shall be set by a resolution of the City Council.
All monies collected as the Capital Facilities Charge shall be used only for projects identified
in the 1995 Water Master Plan to mitigate new water demands resulting from the
development paying the Capital Facilities Charge. (3302-11/95)
14.12.020 Installation and meter fees. In addition to the fee set forth in Section 14.12.010(a),
the Water Department shall charge and collect in advance the following amount for the
installation of water connections and meters: a sum equal to the actual cost of labor and material
in laying such service line, including the cost of the meters,the cost of replacing pavement,plus
fifteen(15%)percent for overhead. The cost of such installation shall be estimated by the Water
Department, and such estimated cost shall be paid by the applicant to the Water Department
before the work of connecting the main with the property is commenced. Whenever the
estimated cost is not sufficient to cover the total expense for labor,material,meters and
overhead,the deficit shall be charged to the property for which such installation was made and
paid by the owner thereof. Any excess payment shall be returned to the person applying for
installation. (674-12/67, 1996-8/75)
14.12.030 Installation by applicant. The Water Superintendent may in his discretion authorize
an applicant to make the installation at applicant's own cost, and in conformity with the
specifications set forth by the Water Department. (674-12/57)
14.12.040 Water rates--Designated. The water rates to be charged monthly and collected
monthly or bimonthly, as may be determined by the City, shall be set by a resolution of the City
Council.
A Capital Surcharge to be charged monthly as may be determined by the City shall be set by
resolution of the City Council. All monies collected as the Capital Surcharge shall be used only
for projects identified in the 1995 Water Master Plan. (3302A 1/95)
The water rates,plus a ten(10%)percent surcharge, shall be applicable to areas outside the
boundaries of the City of Huntington Beach,wherever the City serves water,including Sunset
Beach, an unincorporated area, and Surfside, located within the City of Seal Beach. (674-12/57,
7514160.892-4162,1100-12/64.1217-7166,Urg 1343-A-8/67, 1344-9167,19014/74,1996-8t75,2205-7177,2218-11/77,Urg
2709-6/84,2826-5/86,2948-8188.3119-7/91)
14.12.045 Water rates--Budeet. It shall be the policy of the City that a balanced budget shall
be maintained for the water fund. Pursuant to Section 602 of the Charter of the City of
Huntington Beach,the City Administrator shall be required to submit said water fund budget in a
balanced condition to the City Council,together with the other budget submittals. The water rate
adjustment necessary to maintain a balanced budget shall be incorporated as part of the annual
budget which shall modify the rates as set forth in Section 14.12.040 of the Huntington Beach
Municipal Code upon adoption of the budget. For the purpose of this Section, "balanced budget"
shall mean that total appropriations for operating expenses do not exceed total estimated
revenues in the annual budget of the water fund.
Operating expenses shall include appropriations for the depreciation cost of those capital
improvements customarily provided for in the operating budget and in accordance with generally
accepted accounting principles. Revenues shall exclude bond proceeds, if any,but include
interest earnings and other nonoperating revenue in accordance with generally accepted
accounting principles. (Urg 2709.6/84)
10/98
Huntington Beach Municipal Code 14.12.090-14.12.150
14.12.090 Water service—Applications. All applications for water must be made out on forms
provided by the Water Department and must be signed by the applicant or his or her agent.
All applicants must deposit with the Water Department a fee established by resolution of the City
Council as a guarantee that all water bills, fines and penalties shall be paid by the applicant.
The deposit shall be returned to the applicant at the time water service is discontinued provided
that applicant has not left unpaid any water bill,fine or penalty. Such unpaid water bill;fine or
penalty shall be deducted from the applicant's deposit and the balance thereof, if any, shall be
refunded to the applicant at his or her last known address. (674-12/57,2020-12/75,25U8-11/81)
14.12.100 Water service—Turn-on charges. No charge shall be made for the transfer due to
change of ownership or occupancy.
Where the owner or occupant requests temporary turnoff of water service, a charge of five dollars
($5) shall be made for restoring the water service to the premises. (697-12/57, 1996-8n5)
14.12.110 Water rates--Turn on. Whenever the distribution line of the municipal water system
shall be duly connected with the premises of any person, and the water turned on such premises,
the charge for water shall be a charge against the person in possession of the premises who used
the water, and the charges shall continue so long as the water is turned on to the premises,
whether the same is actually used or not. (674-12157)
14.12.120 Water billing, All water bills are due upon presentation and are payable at the Office
of the Treasurer of the City of Huntington Beach, or his authorized agent. Bills are deemed
presented if addressed to the water customer at the address shown on the records of the City
Treasurer and deposited with the United States mail service,postage prepaid. Accounts which
remain unpaid thirty(30)days thereafter are delinquent. A notice of final billing shall be mailed
to each delinquent account specifying a date by which full payment is due. Said final billing
shall include a late fee imposed to recover billing and mailing costs, set by resolution of the City
Council.
Water service for delinquent accounts shall be shut off until all outstanding bills, fees, utility
taxes and penalties have been paid. When the supply of water has been shut off for nonpayment
or a violation of any ordinance or of any rule or regulation, service shall not be resumed until a
turn-on fee, as set by resolution of the City Council,has been paid. (674-12/57, 1996-8n5,2400-
11n9,
2589-1/83)
14.12.130 Vacating premises. Whenever a consumer shall vacate any premises, he shall
immediately give written notice thereof to the Water Department. Upon the receipt of such
notice,the department shall read the water meter, shut off the water from the premises and
immediately present the consumer all unpaid bills for water famished by the City to him up to
that time...Thereupon the consumer shall pay said bills to the Water Department. In the event
that the consumer shall have made a deposit with the department, as required in Section
14.12.090, the balance,if any, of such deposit shall be returned to the consumer after deducting
therefrom the amount of said bills. Until such notice and payments shall have been made, the
premises shall be deemed occupied by the consumer and his liability continued. (674-12157)
14.12.140 Change of address. Failure to receive mail will not be recognized as a valid excuse
for failure to pay water rates when due. Change in occupancy of property supplied with City
water, and changes in mailing addresses of consumers of City water must be filed in writing at
the Water Department on forms provided for that purpose. (674-12157)
14.12.150 Renewing service. Each owner or occupant of any premises previously connected
with the City water system desiring to renew the use of water shall make application for renewal
of water service and upon payment of all unpaid charges, if any,together with any turn-on charge
imposed by Section 14.12.100, the water will be turned on. (674-12/57)
7/91
14.12.160-14.12.170 Huntington Beach Municipal Code
14.12.160 Adjustment of rates. The Council shall have the sole power to grant rebates from
the rates specified in this chapter to indigent persons, and in the event of any dispute as to the
water rate to be paid by any consumer,it shall determine the same. (674-12/57)
14,12.170 Water fund. All moneys collected from fees and charges under Chapters 14.04
through 14.20 of the Huntington Beach Municipal Code shall be deposited in the treasury of the
City in a water fund and annually there shall be disbursed from said water fund to the general
fund, an amount equal to fifteen(15%)percent of the gross revenue received from the sale of
water by the Water Department in lieu of franchige and property taxes. (73e-12/59)
7191
10" FM $969.00
A charge of three dollars, fifty($3.50) shall be made for each unit in excess of one connected to
each meter.
"Unit"means any building or a portion of a building consisting of one or more rooms separated
from the rest of the building by a partition, occupied independently of the other parts of the
building, or another building.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular
meeting thereof held on the Iathlay of September 1995.
ATTES �j�,Q�ir e-11
Mayor /
City Clerk 94-
APPROVED AS TO FORM:
RE D APPROVED:01
�a_.yS
rl � City Attome
rty Administrator
IN D APPR VED:
Dir o P r s
water/jmm/9/12195
Res.No. 6712
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of
the City of Huntington Beach, and ex-officio Clerk of the City Council of said
City, do hereby certify that the whole number of members of the City Council of
the City of Huntington Beach is seven; that the foregoing resolution was passed
and adopted by the affirmative vote of at least a majority of all the members of said
City Council at a regular meeting thereof held on the 18th of September, 1995
the following vote:
AYES: Councilmembers: Harman, Bauer, Sullivan, Leipzig, Dettloff,
Green, Garofalo
NOES: Councilmembers: None
ABSENT: Councilmembers: None
City Clerk and ex-offacio Clerk
of the City Council of the City
of Huntington Beach, California
01reso1utVresbkpg
0E-07-98 11 : 34AM FROM CITY CLERK ruc
RESOLUTION NO. 6713
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH ESTABLISHING THE CAPITAL FACILITIES CHARGE AND THE
CAPITAL SURCHARGE UNDER THE HUNTINGTON BEACH WATER MASTER PLAN
WHEREAS, in September, 1988, the City adopted as Water Master Plan for the City of
Huntington Beach which did not include a financing plan;and
The Water Master PIan was updated to include financing in 1993 and City appointed a
Water Task Force to review the Water Master Plan; and
The Water Task Force presented an updated Water Master Plan for adoption by the City
which included the means of financing the 1995 Water Master Plan; and
The City Council desires to establish new rates and change existing rates charged to the
public for new and existing water services to finance the Water System Master Plan Capital
Improvement Program,-
NOW, THEREFORE,BE IT RESOLVED by the City Council of the City of Huntington
Beach that, effective December 1, 1995, the following Capital Facilities Charges under
Huntington Beach Municipal Code Section 14.12.010 be applicable.
METER SIZE FLOW CAPACITY EQUIVALENT CAPITAL
(inches) (gal. per min.) DWELLING UNITS FACILITIES
CHARGE
3/4 30 1 $2,400
1 so 2 4,800
1-1/2 100 3 7,200
2 160 5 12,000
3 320 11 26,400
4 Soo 17 40,800
Compound
4 1000 33 79,200
FM*
6 1000 33 79,200
Compound
6 2000 67 160,800
FM*
8 3500 117 280,800
FM*
1
mo 1412/jmM9/12,95
UU Ui Jv Ii .jiAW fLVkl �,I11 l,LCal1 fUJ
10 5500 183 439,200
FM*
"A Fireline meter is a type of high capacity meter approved for domestic or fire protection
service.
BE IT FURTHER RESOLVED that, effective December 1, 1995, the Capital Surcharge
under Huntington Beach Municipal Code Section 14.12.040 shall have an initial rate of$3.00 per
month per equivalent dwelling unit and per each additional unit connected to the meter with an
annual increase of$.50 per year. The maximum rate increase will be$5.50 per month per
equivalent dwelling unit per residential meter and per each additional unit connected to the meter
in the sixth year. The rate shall decrease to $2.00 per month per equivalent dwelling unit and per
each additional unit connected to the meter at the end of twelve years.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular
meeting thereof held on the 18thday of Septembgr1995.
ATTEST: // 4
Mayor
City Clerk fr
APPROVED AS TO FORM:
RE APPROVED: gr/��
�- ity Attorney
ity,Adnunis rat r
TI E AND PROVED;
_ Director o Works
2
rea1412rjmm/9/12,95
vu-u ryu tt .,i4nm rr.vtn �ttt �ycnn ruq
Res. No. 6713
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of
the City of Huntington Beach, and ex-officio Clerk of the City Council of said
City, do hereby certify that the whole number of members of the City Council of
the City of Huntington Beach is seven; that the foregoing resolution was passed
and adopted by the affirmative vote of at least a majority of all the members of said
City Council at a regular meeting thereof held on the I8th of September, 1995
the following vote:
AYES: Councilmembers: Haman,Bauer, Leipzig, Dettloff, Green
NOES: Councilmembers: Sullivan, Garofalo
ABSENT: Councilmembers: None
4 4n4�: 2�1"^
City Clerk and ex-officio Clerk
of the City Council of the City
of Huntington Beach, California
t
G/mealutVrmbkyy
Public Works Department R g IDPAOM mow
A EIlN.A MART OF THE RECORD AT E
��1TING OF -9
004,E09RO9KWAY,CITYOELORK
fiublic Works - Water Division
Proposed Water Rate Increase
May 1999
Water Bill Distribution
Water Bill
W afar Usage and Meter Charge Water Master Plan Surcharge
W aLr Fund Capital Operations and Maintenance Master Plan Projects
Existing System Personnel Capacity Enhancements
Replacements and Upgrades I Routine/Preventive Tasks
OCW D and MW D Costs
Equlpm enl fleplacement
PublicWorks Department
C�l1�it�il Improvethents
Wtltcr f�unrl M1sGe�tiP']Ir�mi
� R��+�;ICC7 Cpgrade Additional Capacity
I .�i.ting Facilities - Fz>zr.++;cs
— o-V_i.n:�Water Mains — E3oozrzr Sruion:
— 2e�ruUU Wells — Lramortis.ion VEaet;
- Vlc+mitur;ne systems -.Deficiency Corrections
— Winter treatment — Lion 41p�¢adas
— Lz:tf. R<reaion
— l oRe�ion C+xttr�d
3
Projec�edl Reserves. - Curre � �� l��u���
•
3.
is
AI illiuns nt5 t•
i
•
98f99 9'/lUll IIIlllll
Er endilures S'_3.119 5?S.IIS S?N.119
Resenue S'_1.75 S?2.65 S'_?.7J
Resenec S7.3R S3.7fi SILJd
4
Public Works Department
ProjeC��dl �ewelva��� avnd � �;�c��vdlIl���r��; -
C'aurr �. ' Ge
•
ul
15
�� Improvements
111 �Replacement
s O Operating
� 15
E
�Personnel
Ip Revenue
Reserves
11
YS/99 9Y/IIII 1111/III
5
�c��ccezv�,�, ur<u �x���uu��s, - �o,U�,dln�r•��uo,�n
•
:. Chlorine: a`,�n�annlnent u[luaa ae�wirecf Cny Vua�a� �p^QOI�^�
.-fin anten�rwAG�,e�eaunulutit;e ��h'D �V7/�Ia�,Qe;- �� �j
^
foot inerEase Va-V 3�',. ) in GVne: �e�VensBnnn�anG
.�ve,s,rtuaLG yVtAt in the aexG nk.o.y:e:us
\e« n�anV�Ga�mj aeportin�* ��aaurement�. -��1,�)
\evti tnaaa�laaGr�oy� water anal�fili"ar enc�� �rc���Gauti ��^�
E>timateei znvc.cn�e ?S�z iiaDG��Gion on a�caaGoen� ����
bud_e[
6
Public Works Department
Increase i,n Expenses - discretionary
•
Non-Nester Plcn Improvements $6,000.000
Utility Bilfing System I ,000A00
Adcbtiond in-lieu from increcsed 120.000
water s d es
T otd' $7,120,000
Pro o�ecl Rate
Water Usage (per billing unit)
Date Flom To Increase
7/1/00 $1.04 $L12 8�
'1 billing unit=748ga1.
Public • Department
Proposed Rate
•
Basic SFR* 3/4" Meter Charge
Date From To Increase
2/1/00 $5.70 $6.10 40
7/1/00 $6. 10 $6.50 40r�
'Single Family Residence
9
Typical SFR Bill Example
•
� 15 billing units, 3/4" meter
Current - $23.50
� Last Rate Increase - 12fIf9�5
o
Public Works Department
Projec�edl � eserves - Proposeci Rate
• i
35
311
2$
20 -
15
\lillionsof� III
5
0
9NPA/ 1911111 INlllll
1!e •mlilures S23.U9 529.�11 529.24
Nrrenur S2L1 526.111 328.U7
Ne.�rne� 57.77 S4.N0 31.19
Proposed �Zate
Projected Rever���e� and Expendit«res
•
35
30 �
I 5
0
9S/99 99/1111 1111/111
i[
Public • Department
lMultipLc Dwelling Unit/Commercial
Bi]ling Equity
•
Proposed r€tte srrtuet�tre:
Addresses concerns raised by apartment owners
Recommended by the City Attorney
�Nluiti-unidCommercial basic meter charge to eyual
meter rate times number of units
13
�ie�ouzl�mendatic�n
'evise gate structure and phase increases
•
Date Water Meter Months
Usage Charge
12/1/y5 �0.88 $5.30
2/1/00 $lA4 �6.10 7
7/1/00 $1.12 $6.50 5