HomeMy WebLinkAboutSanitary Sewer Charge on Monthly Municipal Utility Billing �- � I PN
&Y OF HUNTINGTON BEAC'W\0 5 A4
MEETING DATE: February 20, 2001 DEPARTMENT ID-=IBER:PW 01-009
Council/Agency Meeting Held: 0)
Deferred/Continued to:
Approved U Conditionally Approved LJ Denied y CI'flrlN-'L- Signature
3 a=4 e C-4- Aol b-
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L-70"Uncil Meeting Date: February 20, 2001 Department ID Number: Pvqrb i-0 0
CITY OF HUNTINGTON BEACH
REQUEST FOR ACTION
SUBMITTED TO: HONORABLE MAYOR AND CITY-COUNCIL MEMBERS
SUBMITTED BY: RAY SILVER, City Administrat r1 ram`
PREPARED BY: ROBERT F. BEARDSLEY, Director of Public Works
SUBJECT: Initiate consideration of proposed Sanitary Sewer Charge on Monthly
Municipal Utility Billing
Statement of issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s)
Statement of Issue: Should the City Council initiate consideration of a proposed Sanitary
Sewer Charge under the provisions of Health & Safety Code Section 5472 to pay for the
unfunded cost of rehabilitation, replacement and maintenance of the City's sewer
facilities?
Funding Source: Additional funding is not required for this phase leading up to the
enactment of a sewer charge. Approximately $30,000 is budgeted in Public Works
Contract Services (10085251.69365). Funding requirements for implementation of the
sewer charge will be included in the final report, which subsequently would be presented to
the City Council for approval.
Recommended Action: Motion to:
1. Direct staff to proceed to develop the proposed rate structure, programming by City's
Information Technology Staff, and drafting of a proposed ordinance,for implementation
of a monthly sewer service charge pursuant to Health & Safety Code Section 5472.
2. In accordance with the established schedule, direct staff to return on the City Council
meeting of March 5, 2001 with a professional services contract with Darrel Cohoon &
Associates for services relating to establishing the rate structure and preparing the
reports needed to demonstrate that the charge is reasonably related to the cost of the
service.
01-009 Feb 20 Dysart(Sewer Charge) -2- 2114101 4:50 PM
� I k
REQUEST FOR ACTION
MEETING DATE: February 20, 2001 DEPARTMENT ID NUMBER:PW 01-009
3. Direct staff to base a proposed rate structure on either:
0ptlen 1 Maintain (net supplant) the histeFieel level ef Gener-al Fund expeigelituFes feF
Option 2 Include all costs of sewer system maintenance, operations and repair in the
proposed sewer charge rate structure with the provision that the historical level of
General Fund allocations for those sewer system costs be used for other infrastructure
improvements and/or maintenance.
4. In accordance with the established schedule, direct staff to return in May 2001 or
sooner, to review with the City Council, at a study session the proposed sewer charge
rate structure and draft ordinance.
Alternative Action(s): (1) Deny the recommended action. (2) Provide alternative direction
to staff.
Analysis: The City's Integrated Infrastructure Management Program (LIMP) has identified
the need to rehabilitate and/or replace substantial portions of the City's sewer mains,
manholes and sewer lift stations at an estimated cost of approximately $97 million over the
next 20 years for which the projected available funding is approximately $4 million. The
Citizen's Infrastructure Advisory Committee (IAC) in its Final Report dated July 2000
confirmed the need and rated sewers as the highest priority infrastructure need. The City
Council requested the staff to prepare this report for consideration.
At a cost of over $2.6 million, the City successfully funded major slip lining improvements
for the downtown area through a combination of Orange County Sanitation District and
CDBG grants and $1 million of City General Funds. Even with these recent improvements,
it is evident that a dedicated, funding source is needed to address on-going sewer system
improvements and maintenance.
The Infrastructure Planning Committee (IPC) unanimously recommended that the City
Council immediately consider the enactment of a monthly sewer service charge as a
dedicated funding source for the improvements and increased sewer system maintenance
levels. Enactment of such a new revenue source will help provide the funding to ensure
compliance with the recent Santa Ana Regional Water Quality Control Board (SARWQCB)
mandate regarding the City's sewer system deficiencies.
The Public Works Department, with the assistance of a consultant (Darrel Cohoon &
Associates), evaluated a monthly sewer service charge as a method of funding the
improvements and required level of maintenance. Alternative rate structure methodologies
and billing methods were included as part of the effort.
01-009 Feb 20 Dysart(Sewer Charge) -3- 02/15/01 11:36 AM
REQUEST FOR ACTION
MEETING DATE: February 20, 2001 DEPARTMENT ID NUMBER: PW 01-009
A survey (Attachment 1) of Orange County Sanitation District member agencies indicates
that the majority has sewer charges. Historically, the City has funded annual sewer
maintenance, operations and repairs with General Funds, averaging $1.3 million.
Improvements were dependent upon grants from other governmental agencies, developer
paid sewer connection fees and emergency General Fund allocations.
Estimate of Expenditures and Revenue Needs
The revenue from the monthly charge will be used for the unfunded costs of rehabilitation
and replacement of sewer mains, manholes and lift stations as identified in the IIMP. It
also will be used to fund the increased levels of maintenance as recommended and to
establish a fund for future replacement of these facilities. Under this approach, the revenue
from the sewer charge would not supplant the General Fund (approximately $1.3 million)
currently expended for annual maintenance, operations and repair. Also, this approach is
consistent with the recommendations of the Citizen's Infrastructure Advisory Committee
(IAC). Option 1 presented on Attachment 2 for the revenue projections reflects this
approach.
The IAC recommended that any new revenue approved for infrastructure not supplant
existing infrastructure funding. It was the Committee's concern that the historical levels of
funding for infrastructure from the General Fund or other sources be maintained so that
there is a net gain in infrastructure expenditures.
Alternatively, the full costs of sewer system maintenance, operations and repair could be
included in the proposed sewer charge rate structure with the provision that the historical
level of General Fund allocations for those sewer system costs be used for other
infrastructure funding. This approach is reflected in Option 2 presented on Attachment 2.
The following is a breakdown of expenditures and projected revenues. The sewer
charge is proposed to be an ongoing dedicated funding source that would not be limited
to a 20-year period. Twenty-year projections from the IIMP are used for calculation
purposes only.
01-009 Feb 20 Dysart(Sewer Charge) -4- 02/15/01 11:36 AM
REQUEST FOR ACTION
MEETING DATE: February 20, 2001 DEPARTMENT ID NUMBER: PW 01-009
PROJECTED EXPENDITURES
IMPROVEMENTS (In Millions)
Rehabilitation and Replacement of sewer mains and manholes $68.2
Rehabilitation and Replacement of sewer lift stations 28.9
Subtotal $97.1
MAINTENANCE (In Millions)
Maintenance & Repair $30.6
Total Estimated 20-Year Expenditures $127.7
Estimated Sewer Charges
It is estimated that a flat charge per month for Option 1 would be in the range of $5 per
single family home, $4 per multi-family unit, and varying higher charges for commercial,
industrial, and public/private school users.
For Option 2, the charge is estimated to be over $6 per single-family home, $5 per multi-
family unit, and proportional amounts in the other user categories.
Billing Methods Evaluated
Implementation of a sewer charge requires a system to get the bills to the customers and to
collect the amounts due. Methods considered in the preliminary studies are:
1. The City's municipal services bill
2. The County property tax bill
3. A private contractor
There are advantages and disadvantages to these methods. The first two are used by
most cities, with the water utility bill being prevalent. There are very few examples of
private contractors handling the billing and collection. Preliminarily, City staff has
concluded that using the City's municipal services bill would be the optimum method.
As part of the process of evaluating the billing methodologies, input was sought from the
City's Information Technology (IT) staff and the City Treasurer's staff. The availability of
the City's IT staff to set up the billing system for the sewer charge during the
implementation of Phase II of the City's JD Edwards financial management system is of
concern. However, the IT staff has indicated it can provide limited programming support to
implement the proposed service charge based on a flat monthly charge for a limited
number of user categories.
01-009 Feb 20 Dysart(Sewer Charge) -5- 02/15/01 11:36 AM
REQUEST FOR ACTION
MEETING DATE: February 20, 2001 DEPARTMENT ID NUMBER: PW 01-009
Implementation of a sewer charge will require additional support staff for the City
Treasurer's Department, and possibly, Public Works. Customer service requests will
increase for both the office and field representatives. Proposed solutions, and cost
estimates will be included in the final report.
City Attorney's Opinion Regarding Proposition 218 and Approval Requirements
The City Attorney has prepared an analysis of whether the proposed sewer charge would
be subject to.Proposition 218. The opinion concludes that implementation of the sewer
charge, based'on using the recommended flat charge calculation methodology, is not
subject to Proposition 218 and can be implemented by an ordinance approved by two-
thirds vote of the City Council. However, it is noted that the City must recognize that the
opinion is subject to judicial challenge.
The City Attorney further recommends that any fee ordinance expressly provide that
properties not using the sewer system are exempt in order to further demonstrate that the
sewer charge is a user fee and is not a tax.
Implementation Process and Schedule
Implementation of the monthly sewer charge will require approximately five to six months.
As with enactment of any new city-wide charge or fee, there needs to be a comprehensive
public information and outreach program to inform the public of the need for, and benefit of,
the new sewer service charge. Time has been allotted for that important task in the
established schedule of implementation steps (Attachment 3).
In addition, the final report must demonstrate that the sewer charges are reasonably
related to the actual cost of providing the service. This will include a description of the
costs of rehabilitating or replacing the sewer facilities and the level of maintenance.
Moreover, the sewer charge information required to calculate the amounts will need to be
updated and the recommended amounts developed. The data and amounts in the studies
completed to date are preliminary.
Additional Questions and Answers
Presented in Attachments #4 and #5 is information in response to questions posed by
former Council Member Sullivan as well as summary information regarding the Water
Fund.
01-009 Feb 20 Dysart(Sewer Charge) -6- 02/15/01 11:36 AM
REQUEST FOR ACTION
MEETING DATE: February 20, 2001 DEPARTMENT ID NUMBER: PW 01-009
Environmental Status: The proposed action is categorically exempt under the provisions
of CEQA.
Attachment(s):
City Clerk's
Page Number No. Description
1. Survey of OCSD Member Agencies
2. Options for Sewer Charge Revenue Projections
3. Implementation Process & Schedule
4. Response to questions regarding Water Capital Improvement Funds
5. Dr. Dave Sullivan's list of sewer tax considerations dated January 16,
2001 and responses.
RCA Author: Dysart:jm
G:RGA PW 01-09
I
01-009 Feb 20 Dysart(Sewer Charge) -7- 02/15/01 11:36 AM
ATTACHMENT # 1
Darrel Cohoon &A55od
TABLE 1-1. RESIDENTIAL SEWER CHARGES IN OCSD SERVICE AREA, MAY 2000
Typical Monthly
Charge Assuming
1,800 sq.ft. Dwelling
Agency or 15 hcf Water Use Charge Calculation Methodology
Anaheim $.94 Flat charge.
Brea $1.52 Flat charge, varies by size of residential unit.
Buena Park $1.06 Flat rate: 6%of total water bill (capacity as well as
consumption charge).
Costa Mesa Sanitary Single Family$1.92 Flat charge.
District Multi Family.$1.48
Cypress $.50 Flat charge.
Fountain Valley No sewer charge
Fullerton $4.13 Flat rate: 25% of water bill (capacity as well as
consumption).
Garden Grove $5.44 Pre-Prop 13 GG Sanitary District Rate of$2.12
(average residential unit) + Flat charge of $3.32 per
residential unit.
Huntington Beach No sewer charge
Irvine Ranch Water $5.90 Flat charge. Amount varies by consumption blocks.
District
La Habra $1.98 Flat rate: 10%of water bill.
La Palma $3.00 Flat rate: $.20 per 100 hcf.
Los Alamitos No sewer charge
Midway City Sanitary $1.25 Flat charge.
District(includes
Westminster)
Newport Beach $7.35 Flat rate: $.25 per hcf.
Orange Single Family$.42 Flat charge. Also covers storm drains.
Multi Family$.36
Placentia No sewer charge
Santa Ana No sewer charge
Seal Beach $10.51 Flat rate of 22%of total water bill + capital fund fee
combined= $4.68, plus Flat charge for sewer master
plan of$5.83. Water rate, cap fund fee&master plan
fee are all based on meter size.
Tustin No sewer charge
Villa Park No sewer charge
Yorba Linda Water $2.00 Flat charge.
District
' Hundred cubic feet
10
ATTACHMENT #2
OPTIONS FOR SEWER CHARGE REVENUE PROJECTIONS
OPTION 1 Continuing General Fund Support
General Fund $ 27.9
Grants 4.0
Sewer Connection Fees 0.5
Proposed Sewer Service Charge 99.8
20-YEAR REVENUE AMOUNT $132.2
OPTION 2 Without General Fund Support
General Fund $ 0.0
Grants $ 4.0
Sewer Connection Fees $ 0.5
Proposed Sewer Service Charge $127.1
20-YEAR REVENUE AMOUNT $132.2
CALCULATION OF REQUIRED ANNUAL SEWER CHARGE REVENUE
OPTION 1 Unfunded Improvements and Maintenance
$95.2 M divided by 20 years = $4.76 M per year.
Allowance for Future Replacement Fund
5% X $92.6 M divided by 20 years = $0.23 M per year.
Amount of replacement fund at end of 20 years = $4.6 M
(plus accrued interest)
Total Unfunded Amount plus Replacement Fund
$4.76 + 0.23 = $4.99 M per year.
OPTION 2 Unfunded Improvements and Maintenance
$123.1 M divided by 20 years = $6.155 M per year.
Allowance for Future Replacement Fund
5% x $92.6 M divided by 20 years = $0.23 M per year.
Amount of replacement fund at end of 20 years = $4.6 M
(plus accrued interest)
Total Unfunded Amount plus Replacement Fund
$6.155 + 0.23 = $6.385 million per year.
ATTACHMENT #3
Preliminary Schedule of Tasks to Enact Monthly Sewer Charge
Revised February 8, 2001
Item/Task Begin Date Completion
Date
• Infrastructure Planning Committee(IPC) considers Nov. 2000 Nov. 2000
sewer charge for recommendation to City Council Completed
� • Information Technology(�I�T�)"stafertakes ���Nov/� 2000 .Tari 2001
assessment of staff availab��ty �"� ��� Com leted
• City Council initiates consideration of proposed Jan. 16, 2001 Feb. 20,2001
sewer service charge
• CousuitantEprep ra es finales r charge calculat1pns Mar 2g01 w,April 200F
and information:neededafor�nformmgpubhc,and Wr
-
/ for u"se by"IT staff and city Attorney � `� �"� �
3�
• Public Information Program launched regarding all Mar.. 2001 Aug. 2001
city infrastructure including sewers
•, In�tiaPP�hase�of prograinm�n &�testmg�by 1�T'staffs ��eli 200 Apc 2001�
• Proposed Sewer Charge Ordinance prepared by Mar. 2001 April 2001
City Attorney
C Coun I S udy SessionSregard�rig proposed rN M y 2001 �
sewer rate structure,proposed ord�uance'anda
scheduling of pubhcmeehng
• Conduct public outreach meetings May 2001 July 2001
•` J' p, blic nonce with�water biug�Y� lYIal � .Tune 200
•\ Publish notice of meeting to consider ordinance May 2001 June 2001
City`Council conducts pubhc�meet ng, mtroducesm. s �a 3ulS,2001
yrr
• 2n reading and adoption of ordinance ------ Aug. 2001
•_, Effectiue�date of�ordinance � \ ��� r � ,�.�"��� a=�� Sept 200
,
• IT staff adds charge to city utility billing system July 2001 Sept. 2001
•' g pp ors on utility bill '�®ctfNov 2001
F rst month
ATTACHMENT #4
Attachment #4
Water Capital Improvement Funds
Water Master Plan Fund:
1. Established for projects identified in the Water Master Plan that increase
storage and supply capacity in the water system.
2. Revenue is from monthly surcharge and capital facilities charge.
3. Recent WMP update concludes that funding and project costs are
balanced
4. Developed as 11- year"pay-as-you-go" program.
5. Beginning in 2007, the surcharge will be reduced to $2
6. A fund balance of approximately $1 million will be maintained to finance
increased operating costs of the new facilities and eventual replacement.
Water Operating Fund:
1. These revenues fund daily operations, wholesale water purchases, and
routine maintenance programs.
2. The fund balance (reserves) as of September 30, 2000 was approximately
$5 million of a $37 million operating budget.
3. Current energy costs may require an additional $1 million this fiscal year.
4. Rates approved in 1999 will continue through 2003.
5. The reserves include both designated and undesignated fund balances:
Undesignated funds are kept for unforeseen operating expenses such as
electricity and natural gas increases or emergency repairs.
Designated Capital Replacement Fund is reserved for major facility repairs
replacement and vehicle/equipment replacements.
ATTACHMENT #5
ATTACHMENT 5
Response to Dr. Dave Sullivan's Sewer Tax Considerations
Dated January 16, 2001
Item 1 - Study session at a televised Council meeting and schedule public hearing for
tax consideration at a subsequent meeting to allow public study and input in the interim.
Answer: The proposed schedule (Attachment 3) includes provision of a City
Council study session (not necessarily televised) in advance of finalizing the
Implementing Ordinance and the proposed rate structure. There would also be a
public outreach effort in advance of the noticed public meeting on the Sewer
Charge Ordinance.
Item 2 — Funds already collected for sewers and expenditures.
Answer: Funds collected year to date are approximately $25,000. Budgeted
expenses are approximately $3.2 million, which includes rebuilding two sewer lift
stations. The construction projects have been awarded. The year-end balance of
the Sewer Fund is estimated to be less than $200,000. (Attachment 5-A)
Item 3 — Has any money been transferred out of these funds for other purposes in the
past 10 years?
Answer:The City has transferred $795,000 out of the Sewer Fund into the
General Fund over the last ten years. These operating transfers are designed to
cover overhead costs associated with the Sewer Fund. (Attachment 5-B)
Item 4- Estimated amount to be collected for sewers this fiscal year.
Answer: $80,000 (Attachment A)
Item 5 — List of amounts collected for past 10 fiscal years.
Answer: Listed on Attachment B
Item 6 — How does the slip lining technique alter previous estimates for sewer repairs
under the old technique?
Answer: The slip lining technique results in decreased costs compared to the
alternative technique of removal and replacement. The estimates included in
the IIMP are based on recent construction bid prices for slip lining in the
rehabilitation of the sewer mains.
1
Responses to Sewer Tax Questions
February 20, 2001
Item 7 — Does Proposition 218 allow the Council to adopt a sewer fee?
Answer: The City Attorney has prepared an analysis of whether the proposed
sewer charge would be subject to Proposition 218. The opinion concludes that
implementation of the sewer charge, based on using the recommended flat
charge calculation methodology, is not subject to Proposition 218 and can be
implemented by an ordinance approved by two-thirds vote of the City Council.
However, it is noted that the City must recognize that the opinion is subject to
judicial challenge.
2
ATTACHMENT 5-A
City of Huntington Beach
Sewer Fund -FY 00/01 Revenues and Expenditures
RE1lNUES k &ff0dq9tW .
Use of Money and Property
Interest Income $70,000 $0
Charges for Current Services
Public Works $10,000 $24,540
Other Revenue
Sales $0 $3
A�IREVNUESk $80000 $24,5,43
EXPENDITURES 'Buds�et''`, YTO 2��;
Personal Services
Salaries, Permanent $121,478.00 $24,607.95
Salaries, Temporary $10,200.00 $0.00
Salaries, Overtime $0.00 $640.59
Benefits $41,832.00 $6,588.75
Total Personnal Services $173,510.00 $31,837.29
Operating Expenses
Professional Services $352,358.31 $902.43
Other Contract Services $5,400.00 $0.00
Expense Allowances $0.00 $105.61
Total Operating Expenses $357,758.31 $1,008.04
Capital Expenditures
Improvements $2,715,782.00 $0.00
Total Capital Expenditures $2,715,782.00 $0.00
TOTAL EXP.IzNDITURES t .- = . -$3 247 050.3�1 "' $32 843 33:
City of Huntington Beach Sewer Fund Information
ATTACHMENT 5-B
City of Huntington Beach
Sewer Fund -Revenue and Expenditures
Fiscal Year 90/91 through Fiscal Year 99/00
v (In`Thousands) _, YEAR SUM
BEGINNING FUND BALANCE-JULY 1, 1990 5,266
REVENUES:
Developer Fees 722
Interest income (Use of money & property) 2,313
From Other Agencies 23
Charges for Current Service 118
Other 19
TOTAL REVENUES 3,195
EXPENDITURES:
Public Works Department 1,407
Non-Departmental-GIS Program Development 188
Capital Projects 2,719
Transfer to Grant Fund for Slip-Lining Project 900
TOTAL EXPENDITURE 5,214
EXCESS OF REVENUES OVER(UNDER) EXPENDITURES (2,019)
OTHER FINANCING SOURCES (USES):
Proceeds of Bankruptcy 411
Operating Transfers Out (795)
EXCESS OF REVENUES OVER(UNDER) EXPENDITURES AND OTHER USES (2,814)
Residual Equity Transfer Out (200)
Prior Period Adjustment (578)
ENDING UND BALA EPTEMBEW1 ,2QQ0 ` g
Total Outstanding Liabilities (179)
Other Receivables 62
Advances to Redevelopment Agency- FY 89/90 296
TQ TA1ASSETSSEPTEMBER3U000= 226t
City of Huntington Beach Sewer Fund Information
RCA 9OUTING S?iEET
INITIATING DEPARTMENT: Public Works
SUBJECT: Initiate Consideration of a Sanitary Sewer Charge on
Monthly Municipal Utility Billing
COUNCIL MEETING DATE: February 20, 2001
........
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 Attome Not Applicable
Subleases, Third Party Agreements, etc.
(Approved as to form by City Attome 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) Attached
Commission, Board or Committee Report (If applicable) Not Applicable
Findings/Conditions for Approval and/or Denial Not ALpflcable�j
EXPLANATION FOR MISSING ATTACHMENTS
REVIEW D RETURNED FORWARDED'
Administrative Staff y D =/4
Assistant City Administrator Initial
City Administrator Initial
City Clerk
EXPLANATION FOR RETURN_OF ITEM
SpaceOnly)
RCA Author: Dysart:jm
—---------
COMJN�
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CITY OF HUNTINGTON BEACH
CITY COUNCIL MEMO
HUNTINGTON BEACH
o� -Ib—al
' s
To: Honorable Mayor and City Council Members
CoWv�ILM� �
From: Ralph Bauer, City Council Member � �WtDMMS U�5 f ci�
Date: �4� fi� N�
December 19, 2000 --��}}�
04
Subject: "H"ITEM FOR THE JANUARY 16, 2001 COUNCIL MEETING 1N tt ��
WASTE WATER FEE TO SUPPORT REHABILITATION,
REPLACEMENT, MAINTENANCE, AND OPERATION OF THE
HUNTINGTON BEACH SEWER SYSTEM
STATEMENT OF ISSUE:
According to the IIMP of September 2000, the financial needs of the Huntington
Beach sewer system for the next 20 years are as follows:
Rehabilitation and Replacement $ 92.6 million
Maintenance and Operations 27.9 million
Total Needs: $120.5 million
Of this, $38.6 million has been identified as "immediate needs."
RECOMMENDED ACTION:
It is requested that the staff return to the Council by the second meeting in
February with a proposal that sets up a sewer fee to pay for the above needs.
The total needs amount may be reduced by various grants, reimbursement
districts, etc., thus reducing the fees to be charged. The fee for individual users
can be based on water usage.
RB:cf
cc: Connie Brockway
Ray Silver
ti
do
January 16, 2001
To: City Council and Staff
From: Dave Sullivan W:CEIVED FROM s�
RNP MADE A PART OF THE RECORD qT TH`E
O�NCIL MEETING OF /-/6
Sewer Tax Considerations OFFICE OF THE CITY CLERK
CONNIE BROCKWAY,CITY CLERK
Study session discussion at a televised Council meeting
Schedule public hearing for tax consideration at a subsequent meeting to allow
public study and input in the interim
Information requested from staff for study session
Funds already collected for sewers and expenditures
Has any money been transferred out of these funds for other purposes in the past
10 years?
Estimated amount to be collected for sewers this fiscal year
List of the amounts collected for the past 10 fiscal years
How does the slip lining technique alter previous estimates for sewer repairs
under the old techniques?
Does Proposition 218 allow the council to adopt a sewer fee?
t ATTACHMENT B
Preliminary Schedule of Tasks to Enact Monthly Sewer Charge
December 28, 2000
Begin Date Completion
Date
• Infrastructure Planning Committee(IPC) considers Nov. 2000 Nov. 2000
sewer charge for recommendation to City Council Completed
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IPC recommendation for enactment of proposed .
sewer service charge
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• Public Information Program launched regarding all Mar.. 2001 Aug. 2001
city infrastructure including sewers
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• Proposed Sewer Charge Ordinance prepared by City Mar. 2001 April 2001
Attorney
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• Publish notice of meeting to consider ordinance w May 2001 June 2001
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• IT staff adds charge to current city utility billing July 2001 Sept. 2001
system
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RECEIVED FROM
AND MADE A PART OF THE R CqR AT THE
COUNCIL MEETING OF H boo J_
OFFICE OF THE CI Y CL RK r /�•
����� CONNIE BROCKWAY,CITY CLERK /
02/20/2001' 18:23 714840F URASHIMA .L PAGE 02
RECEJM FROM
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ANDWEAPARTIOF
COUNCIL.AAEETIIi(i 0 E o
� �r aFRO OFCITY CLERK
OC+WIE BROCKWAY,CITY CLERK
ITEM it F r "SG -y S�uur f-ce
' MARY F. URASHIMA
587,E Liege Drive Huntington Beaeb CA 92649
714-84&0878 Facsimile.714-840-99X9
urAshima®earthlink.net
Honorable Mayor Para Julien'Houchen
Members of the City Council
City of Huntington Beach
4
2O00 Main Street
Huntington Beach, CA 92648
l
RE: City Council Agenda Item#F4
Dear Mayor Houchen and City.Council:
I wish to,express'my support for Item#F4, the City Council's consideration of a
sanitation fee and the.retention of qualified expertise to develop'a proposed rato schedule.
While no one is delighted With the prospect of new fees adduig to,household or business
expenses;.it is clew our.conununit r must meet the rowin demand to re lace,•re air and:
S g g . P p
adequately maintain sanitation lines. Although the correlation between faulty sewer lines
and environmental degradation is considered "unproven", the:common sense answer is
that there will be an eventual link due to the current.and growing burden on the sewer
system. We can no longer put this off for future generations.
s a member of Citizen Infrasiructure:Advisory Committee, I support the
consideration of a sanitation.fee as. recommendation of that committee.. I also note the
sanitation system was a'high priority concern of the Committee due to its public health
,<<. impacts.
Y..', I wul support a reasonable sanitation fee that devotes the generated revenue solely to
.:
infrastructure needs,and would request the Council consider that restriction along with .
,a'�,t_.' the rate schedule.
Thank you for your consideration and'support for Item#F4.
er y
M F. Ur a
11,
Proposed Sewer Charge
City of Huntington Beach
Public Works Department c.
Consideration of
Monthly Sewer Charge
Introduction
> Sewer system unfunded needs
• Replacement/Rehabilitation
• Maintenance
• On-going replacement fund
> Sewers rated as highest priority by the
Infrastructure Advisory Committee (IAC)
> Monthly sewer user charge
recommended by Infrastructure Planning
Committee (IPC) and IAC.
2
(VIV)NJ I C14-T)ON
February 20, 2001
Proposed Sewer Charge
Revenue Requirements
20- ear ro"ection in 2000 dollars
(in millions)
Sewer mains & manholes $ 68.2
Sewer lift stations 28.9
Maintenance & Repair 30.5
Future replacement fund 4.6
$ 132.2
3
Proposed Rate Methodology
Rate structure based on estimated return to
sewer per each user category
Flat rate for single family, multi-family & most
commercial/industrial users
Adjusted water use basis (return to sewer)for
large commercial/industrial users
Per pupil/school day calculation for public &
private schools
4
February 20, 2001 2
v
Proposed Sewer Charge
IERevenue Options
option 1 -SuQplement Existing Funding
➢ Continue General Fund support of
approximately $1.3 million annually
➢ Funds all rehabilitation/replacement
capital costs
➢ Funds only increased level of
maintenance plus future replacement
5
Preliminary Monthly
Charge Structure
Option 1
➢ Single Family Residential $ 5
➢ Multi-family Residential $ 4 per unit
➢ Proportional amounts to other user
categories to be determined after further
analysis
➢ Schools: per pupil/day or full-time
equivalent
6
February 20, 2001 3
Proposed Sewer Charge
Revenue Options (coat,)
Option Z-Supplant Existing Funding
➢ Direct historical level of maintenance
funding ($1.3 M/yr) to other infrastructure
needs
➢Transfer General Funds to a dedicated
infrastructure fund
➢ Funds all operating expenses, salaries and
capital requirements
Preliminary Monthly
Charge Structure
Option ikon 2
➢ Single Family Residential $ 6 +
➢ Multi-family Residential $ 5 + per unit
➢ Proportional amounts to other user
categories to be determined after further
analysis
➢ Schools: per pupil/day or full-time
equivalent
S
February 20, 2001 4
Proposed Sewer Charge
� o
Preliminary Schedule
Prepare final charge calculations, Mar/Apr
develop public information program,
initial programming by IT staff, prepare
draft ordinance
Present at City Council Study Session May
Conduct public outreach meetings May/Aug
Public meetings & ordinance adoption Jul/Aug
Charge appears on customer's bill Oct/Nov
9
Implementation Process
Consultant: Develop proportional rate structure &
report justifying charge in relation to service cost
ITstaf.. Programming considerations and testing
Finance: Prepare appropriate accounting
procedures for enterprise fund
Treasurer/Public Works : Review additional
program costs and customer service needs
City Attorney. Prepare implementing ordinance
10
February 20, 2001 5
Proposed Sewer Charge
Recommendations
Direct staff to proceed with
development of sewer service charge &
public outreach program
Decide on proposed rate structure
(either Option 1 or Option 2).
Schedule a Study Session in May for
presentation of proposed rate structure
and the draft ordinance.
February 20, 2001 6