Loading...
HomeMy WebLinkAbout07.b. Authorize Secretary of District to provide public notice of proposed sewer service charge rate increasesCentral Contra Costa Sanitary District ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: March 17, 2011 Subject: AUTHORIZE THE SECRETARY OF THE DISTRICT TO PROVIDE PUBLIC NOTICE OF PROPOSED SEWER SERVICE CHARGE RATE IN Submitted By: Initiating Dept. /Div.: Debbie Ratcliff, Controller Administrative /Finance &Accounting REVIEWED AND RECOMMENDED FOR B DA RD ACTION: r D. Ratcliff --- rave . Alm James M. KO O, General Mana er ISSUE: To comply with Proposition 218 public notice requirements, the District must provide 45. days' written notice to ratepayers prior to considering a proposed Sewer Service Charge rate increase at a public hearing. RECOMMENDATION: Authorize mailing a public notice of proposed Sewer Service Charge rate increases of up to $30 for Fiscal Year 201 1 -2012, for a total of up to $341 per year effective July 1, 2011, and up to an additional $30 for Fiscal Year 201 2 -2013, for a total of up to $371 per year effective July 1, 2012. FINANCIAL IMPACTS: The total cost of printing and mailing the public notice to District ratepayers is estimated to be approximately $70,000. ALTERNATIVES /CONSIDERATIONS: Forego a public notice and do not propose a Sewer Service Charge increase or notice an amount less than $30 per year. BACKGROUND: Proposition 218 requires written public notice of Sewer Service Charge increases, and the scheduled public hearing in addition to a required legal notice published in the newspapers. Compliance with Proposition 218 requires the District to provide at least a 45 -day notice to all rate paying property owners for a Sewer Service Charge rate increase. For such notice to be given before the proposed June 2, 2011 Public Hearing, mailing preparations must begin by March 25, 2011 or the noticing will cost an additional $5,000 -$1 0,000. As discussed with the Board at the March 3, 2011 Financial Planning and Policy Workshop, based on the operating and capital needs, regulatory compliance in future years and prudent reserve levels, a Sewer Service Charge rate increase of up to $30 for each of the next two years was recommended by staff. The notice must specify the maximum amount of the increase and includes language indicating an amount of up to $30 per year for Fiscal Years 2011 -2012 and 2012 - 2013. N :\ADM1NSUPIADMINIPaSPAPERtSewer Service Charge Public Hearing 03- 17- 11.doc POSITION PAPER Board Meeting Date: March 17, 2011 subject: AUTHORIZE THE SECRETARY OF THE DISTRICT TO PROVIDE PUBLIC NOTICE OF PROPOSED SEWER SERVICE CHARGE RATE INCREASES The $30 increase each year for two years would be used to offset no Sewer Service Charge increase in Fiscal Years 2000 -2010 and 2010 -2011, capital projects, higher energy costs, regulatory compliance, and salary and benefit cost increases. A copy of the proposed public notice is attached for the Board's consideration. If the notice is authorized, the Board would consider setting the Sewer Service Charge rate at the Public Hearing on June 2, 2011. In order to comply with the Proposition 218 timeline and provide the 45 -day ratepayer notice, Board comments are requested on the proposed public notice and authorization is requested for mailing the public notice to residential and nonresidential customers. RECOMMENDED BOARD ACTION: Authorize the Secretary of the District to mail a public notice of proposed Sewer Service Charge rate increases of up to $30 for Fiscal Year 201 1 -2012, for a total of up to $341 per year effective July 1, 2011, and up to an additional $30 for Fiscal Year 2012 -2013, for a total of up to $371 per year effective July 1, 2012. N :IADMINSUPIADMIN\POSPAPER\Sewer Service Charge Public Hearing 03- 17- 11.dvc Central Contra Costa.Sanitary.District Dear Property Owner and/or customer: The central contra costa Sanitary District (CCCSD) provides sanitary sewage collection and treatment, household hazardous waste disposal, and recycled water services in the central county area. The District operates with an . annual budget of about $100 million. CCCSD collects an annual Sewer Service charge from each property connected to the sewer system. The current residential rate of $311 per year per single family unit is billed as a line item labeled "CCCSD SEWER CHO" on your contra costa county property tax bill. CCCSD also receives approximately $73 per residence each year from the county's property tax to renovate and/or replace existing facilities. The CCCSD Board must consider an increase in the annual Sewer Service Charge of up to $30 (58 cents per week) for Fiscal Year (FY) 2011-2012 for a total of up to $341 per year effective July 1, 2011, and up to an additional $30 increase for FY 2012 -2013, effective July 1, 2012, for a total of up to $371 per year. There has been no increase in CCCSD's Sewer Service charge in two years, not since FY 2008 -2009. Since June 2008, new state and federal regulations involving water and air quality, additional testing, and treatment processes have financially impacted CCCSD, along with other increased costs. FOR RESIDENTIAL CUSTOMERS, whether a single- family home, mobile home, townhouse, condominium, apartment, or other multi- family home, this would mean an increase in the Sewer Service Charge of up to 9.6% in the first year and up to 8.8% in the second year. FOR NONRESIDENTIAL CUSTOMERS, the service charge rates are calculated for each customer group based on the cost to provide service, considering both the quantity of sewage discharged and other sewage characteristics affecting the cost for treatment. The service charge increases being considered for this category are shown on the reverse side of this notice. The District operates under a 10 -Year Business Plan, developed by staff and updated annually. The Plan documents CCCSD operations, maintenance, facility needs, and their associated costs, and the needed revenue for the District to meet its regulatory requirements and fiscal responsibilities. A failure to meet the regulatory requirements could impact CCCSD's mission to protect public health and the environment and result in fines imposed by state and federal regulators that could run into millions of dollars. In the next decade, the District faces expenditures of more than $345 million in Capital Projects alone. Those expenditures include $27 million per year ($270 million over 10 years) for ongoing repair and rehabilitation of CCCSD's 1,500 -mile sewer system, and renovation and upgrading of the treatment plant; $70 million potentially required for nitrification, a process to remove naturally occurring ammonia from treated wastewater; and $5.6 million in annual payments on bonds that were issued by CCCSD to pay for needed capital improvements ($56 million). CCCSD must also recover the deficit caused by reduced revenue as a result of no Sewer Service Charge increases over the past two years, a deficit further impacted by higher costs for energy and benefits. Based on the results of the 10 -Year Business Plan, the proposed increases would allow CCCSD to meet its regulatory and financial requirements. NOTICE IS HEREBY GIVEN that the Board of Directors of the central Contra costa Sanitary District will hold a PUBLIC HEARING on this platter in the CCCSD Board Roam, 5019 Imhoff Place, Martinez, California, on Thursday, June 2, 2011 at 2:00 p.m., at which time and place interested persons may appear and be .heard. Only written and signed protests of property owners or customers that include the writer's address are to be counted to determine whether a majority protest to the proposed rate increases exists. Property owners or tenants can. mail their protests to the Secretary of the District at 5019 Imhoff Place, Martinez, CA 94553; hand - deliver them to the Reception Desk at the same address; fax them to (925) 575 - -7211; or e-mail a written, signed protest in PDF format to eboehme centralsan.or . Protests must be received before the Public Hearing ends. A copy of the CCCSD Board Policy on filing a protest can be found on the CCCSD website at www.centralsan.org. Questions about the proposed Sewer Service Charges can be directed to CCCSD's Information Line by calling (925) 335.7702 or by e- mailing rates. @centralsan.org Notice mailed by April 18, 2011. CURRENT & PROPOSED SEWER SERVICE CHARGE RATES FOR NONRESIDENTIAL CUSTOMERS USER GROUP CURRENT RATE MAXIMUM PROPOSED RATE EFFECTIVE JULY 1 2011 MAXIMUM PROPOSED RATE EFFECTIVE JULY 1 2012 Commercial and other Non- Industrial Customers Up to: Up to: 1per Hundred Cubic Feet Bakeries $7.95 $8.72 $9.48 Supermarkets with garbage disposals $6.00 $6..58 $7.16 Mortuaries $5.66 $6.21 $6.75 Restaurants $5.89 $6.46 $7.03 Others $2.88 $3.16 $3.44 Minimum Annual Charge $323.00 $354.00 $385.00 Industrial Customers Flow (per HCF) $1.19 $1.30 $1.42 Biochemical oxygen Demand (per thousand pounds) $661.00 $725.00 $789.00 Suspended Solids (per thousand pounds) $473.00 $519.00 $564.04 Demand (per HCF/day in peak month) $142.58 $156.33 $170.08 Minimum Annual Charge $323.00 $354.00 $385.00 Determined Determined Determined Special Discharge Permits and Contracts individually individually individually Notes: A nonresidential customer's annual sewer service charge is determined by multiplying the appropriate user group rate times the annual wastewater discharge volume measured in HCF (Hundred Cubic Feet), usually estimated from the property's water use. For example, a bakery discharging 250 HCF per year would pay an annual sewer service charge at the July 1, 2011 proposed rate calculated as follows: ($8.72 per HCF) x (250 HCF per year) _ $2,180.00 Alternatively, for 2011 -12 nonresidential customers can estimate their annual sewer service charge by multiplying the amount listed beside "CCCSD SEWER CHG" on their 201 0 -11 property tax bill by 1.10. If billed directly, multiply the amount on the 201 0 -11 invoice by 1.10. For a 2012 -13 estimate, multiply by 1.19. If you have questions regarding the Sewer Service Charge program, or would like the District to calculate a property - specific estimate of the sewer service charge for 2011 -2012 and 2012 -2013, please send an e-mail request including your name, Assessor's Parcel Number, address and phone number to rates _centralsan.orq or calf the District's Environmental Services Division at (925) 335 -7739. Additional information is available on the District's website: www.centralsan.org.