HomeMy WebLinkAbout09. Conduct a public hearing to consider adopting an Ordinance to amend the Schedule of Environmental and Development-Related Services, to be eff. July 1, 2022 Page 1 of 16
Item 9.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: JUNE 2, 2022
SUBJECT: CONDUCT PUBLIC HEARING TO RECEIVE PUBLIC COMMENT AND
CONSIDER ADOPTING UNCODIFIED ORDINANCE NO. 321 AMENDING
THE SCHEDULE OF ENVIRONMENTAL AND DEVELOPMENT-RELATED
FEES AND CHARGES, REPLACING ORDINANCE NO. 317 IN
ACCORDANCE WITH DISTRICT CODE CHAPTER 6.30, TO BECOME
EFFECTIVE JULY 1, 2022
DATA ISAVAILABLE, AS REQUIRED BYGOVERNMENT CODE TITLE 7,
DIVISION 1, CHAPTER 8, SECTION 66016. IF YOU HAVE QUESTIONS,
PLEASE CONTACT SENIOR ENGINEER THOMAS BRIGHTBILL BYE-MAIL
AT TBRIGHTBILL@CENTRAL SAN.ORG.
SUBMITTED BY: INITIATING DEPARTMENT:
BRYAN MCGLOIN, MANAGEMENT ANALYST ENGINEERING AND TECHNICAL SERVICES-
THOMAS BRIGHTBILL, SENIOR ENGINEER PDS-RATES AND FEES
REVIEWED BY: DANEA GEMMELL, MANAGER, PLANNING AND DEVELOPMENT
SERVICES DIVISION
JEAN-MARC PETIT, DIRECTOR, ENGINEERING AND TECHNICAL
SERVICES
Y, �'��_'�I
Roger S. Bailey
General Manager
ISSUE
State Law and District Code require that a public hearing be held to receive public comment on ordinances
which revise Environmental and Development-Related Fees and Charges.
BACKGROUND
Chapter 6.30 of the District Code includes provisions for the Board of Directors (Board)to adopt an
uncodified schedule of fees and charges for environmental and development-related services provided to
June 2, 2022 Regular Board Meeting Agenda Packet- Page 66 of 236
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property owners, contractors, developers, septic and grease waste haulers, and permitted industrial users.
These services include permit counter assistance; plan review; construction inspection for private side
sewers and public main line extensions; addition of new sewers, parcels, and permit information to Central
San maps; administration of source control permits and inspections; and septic and grease hauler
permitting, sampling, and treatment.
Following a review of the fees and charges by Central San staff, it is recommended that they be revised to
reflect changes in the costs to provide the services, including updated labor costs. Information regarding
the proposed changes is included in the attached report.
A comparison of current and staff-recommended fees and charges is presented in Exhibit A to the
attached proposed ordinance. If the proposed revisions to the Environmental and Development-Related
Fees and Charges are adopted by Central San's Board, 26 charges would remain unchanged, 54 charges
would increase, and seven charges would decrease with two new fees and one fee eliminated.
ALTERNATIVES/CONSIDERATIONS
The Board may decline to adjust some or all of the Environmental and Development-Related Fees and
Charges. In this event, the fees that went into effect on July 1, 2021 would continue. This is not
recommended as Central San would not fully recover costs expended in providing the corresponding
environmental and development-related services.
FINANCIAL IMPACTS
The fees and charges on this schedule are intended to recover Central San's labor costs, administrative
overhead, and other operating expenses incurred in providing the related services. The FY 2022-23
District budget projects approximately$2.2 million in Operating and Non-Operating Revenues for
Schedule-related items, consistent with the $2.2 million budgeted for these items in the FY 2021-22
budget. Although several fee increases are requested, a lower level of development is anticipated due to
uncertainty in the current economic climate (specifically related to inflation and interest rates) combined
with the impact of public health and other geo-political factors on future economic conditions.
COMMUNITY OUTREACH
Staff conducted a coordinated outreach program to inform and solicit input from stakeholders and
interested customers regarding the proposed Environmental and Development-Related Fees and
Charges.
Notices of the public hearing were posted and published in the Contra Costa Times and San Ramon
Valley Times circulation areas of the East Bay Times. I n addition, approximately 400 letter reports,
including the proposed schedule of rates and charges, were distributed to developers, engineers,
architects, contractors, waste haulers, representatives of the Building Industry Association of the Bay Area,
and others who have requested notice of fee increase proposals.
As of May 20, 2022, no stakeholders nor members of the public had contacted Central San with
comments.Any comments received after May 20, 2022 will be presented to the Board of Directors at the
public hearing.
COMMITTEE RECOMMENDATION
The Finance Committee reviewed staff's proposals for revising these fees and charges at its April 19,
2022 meeting and recommended holding the public hearing.
June 2, 2022 Regular Board Meeting Agenda Packet- Page 67 of 236
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RECOMMENDED BOARD ACTION
Hold the public hearing. Once the public hearing has concluded, adopt the proposed uncodified ordinance,
revising the Schedule of Environmental and Development-Related Fees and Charges effective July 1,
2022, including the following findings:
• Central San incurs substantial costs to provide environmental and development-related
services.
• It is necessary to charge customers and other users to recover the reasonable cost of
providing the services.
• The proposed fees and charges reasonably represent Central San's actual costs to provide
the services.
• The proposed fees and charges are exempt from CEQA.
(Four affirmative votes are required for adoption.)
Strategic Plan Tie-In
GOAL THREE: Fiscal Responsibility
Strategy 1—Maintain financial stability and sustainability, Strategy 2—Ensure integrity and transparency in financial
management
ATTACHMENTS:
1. Proposed Ordinance
2. Proposed Ordinance ExhibitA
3. Staff Report
June 2, 2022 Regular Board Meeting Agenda Packet- Page 68 of 236
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ATTACHMENT 1
ORDINANCE NO. 321
AN ORDINANCE OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT
ADOPTING AN UNCODIFIED SCHEDULE OF
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES AND CHARGES
IN ACCORDANCE WITH DISTRICT CODE CHAPTER 6.30,
EFFECTIVE JULY 1 , 2022
WHEREAS, the Board of Directors (Board) of the Central Contra Costa Sanitary District
(Central San) finds that Central San incurs substantial costs to provide various
environmental and development-related services, such as, but not limited to,
administration and processing of annexations, customer assistance at the permit
counter, plan review and inspection for sewer line installation, alteration, replacement
and repair, the inclusion of new information on Central San's maps, administration and
permit inspection related to the Environmental Compliance Program, permitting of
septage and grease haulers, and treatment of grease and septage at the treatment
plant; and
WHEREAS, the Board finds that it is necessary to charge customers and other users of
Central San's services to recover the reasonable cost of providing said services; and
WHEREAS, Central San staff has comprehensively analyzed the actual cost of
providing the various environmental and development-related services listed above
based on direct costs, staff costs and overhead for time and effort incurred to provide
listed services; and
WHEREAS, the Board finds that the Schedule of Environmental and Development-
Related Fees and Charges, as reflected in Exhibit "A" to this Ordinance, reasonably
represents the actual costs to provide the services delineated in said Schedule of Fees
and Charges; and
WHEREAS, the Board finds that this action is categorically exempt from the California
Environmental Quality Act (CEQA) pursuant to Section 15273 (a)(1) and (3) of the State
CEQA Guidelines, in that the Fees and Charges are being charged merely to reimburse
Central San for staff costs and expenses.
NOW, THEREFORE, the Board of Directors of the Central Contra Costa Sanitary
District does hereby ordain as follows:
Section 1 (To be uncodified)
The Schedule of Environmental and Development-Related Fees and Charges as set
forth in full in Exhibit "A" to this Ordinance, which exhibit is hereby incorporated in full
herein by this reference, is hereby adopted in uncodified form pursuant to the provisions
of District Code Chapter 6.30. As of the effective date of this Ordinance, the fees and
charges for each environmental and development-related service shall be as set forth in
said schedule, and shall remain in effect until amended or replaced by ordinance.
June 2, 2022 Regular Board Meeting Agenda Packet- Page 69 of 236
Page 5 of 16
Central Contra Costa Sanitary District
Ordinance No. 321
Page 2 of 2
Section 2
All ordinances and parts of ordinances in conflict with the provisions of this Ordinance
are repealed. The provisions of this Ordinance, insofar as they are substantially the
same as existing provisions relating to the same subject matter shall be construed as
restatements and continuations thereof and not as new enactments. To the extent this
Ordinance or any portion or section of this Ordinance is determined invalid or
unconstitutional, such portions of Ordinance No. 317 shall remain in effect and such
Fees and Charges due thereunder for any categories of users shall remain due and
payable as if those portions of Ordinance No. 317 have not been repealed.
With respect, however, to violations, rights accrued, liabilities accrued, or appeals taken,
prior to the effective date of this Ordinance, under any chapter, ordinance, or part of an
ordinance, such chapter, ordinance or part of an ordinance shall be deemed to remain
in full force for the purpose of sustaining any proper suit, action, or other proceedings,
with respect to any such violation, right, liability or appeal.
Section 3
This Ordinance shall be a general regulation of Central San and shall be published in
the Contra Costa Times and San Ramon Valley Times, newspapers of general
circulation of the East Bay Times, published and circulated within Central San, and shall
be effective as of July 1, 2022.
PASSED AND ADOPTED by the Board of Directors of the Central Contra Costa
Sanitary District on the 2nd day of June 2022, by the following vote:
AYES: Members:
NOES: Members:
ABSENT: Members:
David R. Williams
President of the Board of Directors
Central Contra Costa Sanitary District
County of Contra Costa, State of California
COUNTERSIGNED:
Katie Young
Secretary of the District
Central Contra Costa Sanitary District
County of Contra Costa, State of California
Approved as to form:
Kenton L. Alm, Esq.
Counsel for the District
June 2, 2022 Regular Board Meeting Agenda Packet- Page 70 of 236
ATTAC H M EIW I o116
EXHIBIT A
CENTRAL CONTRA COSTA SANITARY DISTRICT
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES & CHARGES FOR
FISCAL YEAR FY 2022-23 uncodified
Fee Category Amount
DEVELOPMENT
Review of new sewer and recycled water plans and related documents;review of plans for and processing of residential and
commercial permit applications;installer reimbursement of sewer construction costs from subsequent connectors;
identification of right-of-way conflicts.
(A-1) Application Fees:
Basic Application (side sewer work, easement staking, permit renewal) $173
Application for new sewer service- new parcel $357
Application for new sewer service-existing parcel $258
Commercial Application (for review of plans for a change in use or expansion of a commercial facility; $368
includes up to one hour of plan review)
Commercial Application- Each additional hour $186
Overflow Protection Device Installation (OPD only) no charge
Side Sewer Cleanout installation (to facilitate installation of OPD only; permit not upgradable) $25
Non-Residential Capacity Fee Installment Payment Program Application Fee $539
Residential Capacity Fee Installment Program and Promissory Note Program Application Fee $539
(A-2) Mainline Extensions:
Plan Review(Sewer Service):
Sewer Service Review(Base fee- up to 3 submittals) $3,876
Restart Application (where design concept previously approved &complies with current Std Specs, $1,871
up to 3 submittals
Each additional hour $209
Manhole only(design & plan review) $1,199
Plan Review(Recycled Water):
Recycled Water Review(Base fee- up to 8 hours) $3,505
Each additional hour $209
Recycled Water Connection only(design &plan review) $1,402
Right of Way Document Review:
Appurtenant Easements(Base fee-up to 3 hours) $665
Subdivision Map (each) $614
Separate Instrument(Base Fee) $790
Each additional hour $222
(A-3) Private Pumping System Plan Check:
System Compatibility Review for Pump (up to 2 hours) $443
Each additional hour $222
(A-4) Special Approvals $423
(A-5) Annexation Fee (per District Code 6.08.030):
New Annexations Actual Expense
Annexation Recovery Fee $681
(A-6) Reimbursement Accounts:
Set-up fee $1,509
Transaction fee $210
(A-7) Special Studies:
Base fee- up to 4 hours; plus misc. costs $915
Each additional hour $187
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EXHIBIT A
CENTRAL CONTRA COSTA SANITARY DISTRICT
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES & CHARGES FOR FY 2022-23
uncodified
Fee Category Amount
DEVELOPMENT(A-8) Environmental Compliance Reviews:
Environmental Compliance Business Review- base fee- up to 4 hours; includes plan review, site $1,086
inspection and inspection time
Each additional hour $222
Grease Variance Review(includes site visit) $469
Environmental Compliance Enforcement Review and Inspection $594
CONSTRUCTION INSPECTION
Inspection of new sewer main construction and new sewer and recycled water connections and other related work on private
property(includes TV inspection when appropriate).
Hours of operation, including premium and holiday schedules, are available at:
www.centralsan.orglpod/hours-directions
(B-1) Inspections by type:
Mainline base fee $981
Mainline per foot(includes in-line manholes or structures) $15.42
New Manhole or structure(e.g. recycled water meter) $1,153
Overflow Protection Device installation (OPD only) no charge
Side Sewer Cleanout installation (to facilitate installation of OPD only) $50
Side Sewer Installation/Repair per 100 feet: $267
Single Inspection Charge (e.g. sewer connectionl encroachment verification; side sewer cap on
property; tap and lateral (new or replacement); air test; reinspection; homeowner preconstruction $267
inspection)
Recycled water connection cross-testing $695
Manhole tap; lateral abandonment at main; pipe bursting; trash enclosure w/o trap; side sewer CIPP $534
repair; outdoor grease trap only
Manhole Alteration; trash enclosure with trap; grease interceptor abandonment $801
Outside pump installation $1,068
Grease/Sand/Oil Interceptor $1,602
(B-2) Overtime inspection:
First Hour(if responding from off-site) $151
Weekend/Holiday-4 hour minimum $448
Each additional hour $99
(B-3) I Inspection of non-permitted work; plus avoided charge(s) $1,202
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EXHIBIT A
CENTRAL CONTRA COSTA SANITARY DISTRICT
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES & CHARGES FOR FY 2022-23
uncodified
Fee Category Application of Fee
(B-4) INSPECTION CHARGES FOR NEW CONNECTIONS (Informational Only)
Current procedure at the Permit Counter is to collect all connection and inspection fees for new construction when a
structure's roof is on and the rough plumbing is installed ("Roof and Rough"). Under the new procedure, a developer can
choose to:
1. Connect at Roof and Rough, or
2. Connect at building foundation following the procedures outlined in the Standard Specifications.
For either scenario, connection fees will be due and payable prior to permit issuance(consistent with District Code).
The changes affect Category(B)Construction Inspection as shown below:
Residential Connections (up to and including four units)at Roof and Rough: This fee is for
inspection of new residential units connecting to CCCSD's mainline after the structure's roof is on and
the rough plumbing has been installed. This fee includes: one building connection inspection and one $534 per unit
side sewer inspection (up to 100 feet). Additional inspections and related fees may be required.
Residential Connections (up to and including four units)at building foundation: This fee is for
inspection of new residential units connecting to CCCSD's mainline prior to structure being roofed and
rough plumbing being installed. This fee includes: one building connection inspection, one side sewer $1,068 per unit
inspection (up to 100 feet), and two additional inspections as required per CCCSD Standard
Specifications. Additional inspections and related fees may be required.
Commercial/Multiple Residential Connections (more than four units)at Roof and Rough: This
fee is for inspection of new commercial or multiple residential units connecting to CCCSD's mainline
after structure's roof is on and the rough plumbing has been installed. This fee includes: one building $534 per unit
connection inspection and one side sewer inspection (up to 100 feet). Additional inspections and
related fees may be required.
Commercial/Multiple Residential Connections (more than four units)at building foundation:
This fee is for inspection of new commercial or multiple residential units connecting to CCCSD's
mainline prior to structure being roofed and rough plumbing being installed. This fee includes: one $1,335 per unit
building connection inspection, one side sewer inspection (up to 100 feet), one pre-construction
meeting, and two additional inspections as required per CCCSD Standard Specifications. Additional
ins ections and related fees may be re uired.
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EXHIBIT A
CENTRAL CONTRA COSTA SANITARY DISTRICT
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES & CHARGES FOR FY 2022-23
uncodified
Fee Category Amount
COLLECTION
TV inspection of sewers conducted separate from a construction inspection activity; verification of sewer location and sewer
service connection.
(C-1) TV Inspection:
Weekday, hourly rate $300
Minimum Charge (2 hour minimum) $600
Overtime- First Hour $210
Overtime- Each Additional Hour $164
Overtime-Weekend/Holiday(4 hour minimum) $702
(C-2) Dye test $341
(C-3) Collection system repair Actual Expense
(C-4) Cancelled TV Inspection without prior notice $567
(C-5) Sewer locating and marking $341
•
Establishing right-of-way agreements and resolving conflicts.
(D-1) Process Quitclaim Deeds $1,288
Process Quitclaim Deed -plat and legal by others $818
(D-2) Process Real Property Agreement, License, or Easement:
Base Fee- Up to 4 hours $1,269
Each Additional Hour $171
(D-3) Right-of-way Research/Encroachment Resolution Fee Actual Expense
(D-4) Right of Entry/Encroachment Permit Fee
Base Fee- Up to 2 hours $465
Each Additional Hour $171
MISCELLANEOUS
District services provided for private sewer projects;interest rates for CCCSD programs;copying fees.
(E-1) Engineering - private sewer projects Actual Expense
(E-2) Soil evaluation-private sewer projects Actual Expense
(E-3) Surveying Actual Expense
(E-4) Annual interest rate for CADs and Septic to Sewer Financing Programs 2.61%
Multiplier to be applied to Alhambra Valley Assessment District(AVAD) 2010-11 Parcel Assessment
(E-5) Amount listed in Ordinance 262-Exhibit B to determine AVAD Reimbursement Fee amounts applicable 1.11084
to connections in FY 2022-23.
(E-6) Multiplier to be applied to St. Mary's Road Contractual Assessment District(CAD) 2011-1 1.01136
Reimbursement Fees listed in Ordinance 279-Exhibit B. Applicable to connections in FY 2022-23.
(E-7) Returned Check/Insufficient Funds Fee $40 plus
bank fees
Up to 10%of unpaid
(E-8) Delinquent/Late Payment Fee amount due plus
1.5% per month on
unpaid balance
(E-9) Document/Plan Copying Fees:
8 1/2"x 11"; 8 1/2"x 14"; 11"x 17" (per sheet) $0.20
24"x 36" Plan (per sheet) $4.00
CCCSD Standard Specifications $25.00
CCCSD Standard Specifications (Pocket Guide) $5.00
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EXHIBIT A
CENTRAL CONTRA COSTA SANITARY DISTRICT
ENVIRONMENTAL AND DEVELOPMENT-RELATED FEES & CHARGES FOR FY 2022-23
uncodified
Fee Category Amount
(F) INDUSTRIAL PERMIT FEES
Permitting and inspection of industries and other commercial dischargers to ensure availability and use of pretreatment
processes.
(F-1) Class I Fees (Base fee plus cost of District's lab analysis) Actual Expense
(F-2) Class 11 Fees(Base fee plus cost of District's lab analysis) $4,168
(F-3) Class III Fees (Base fee plus cost of District's lab analysis) no charge
(F-4) Industrial user permit application fee no charge
(F-5) Special discharge permit application fee ( ):
No on-site inspection, no capacity review $385
On-site inspection $964
Additional charge for capacity review(Required for discharges >50 gpm) $263
(G) SEPTAGE • •
Sampling and disposal of septic waste and grease.
(G-1) Annual permit fee $1,555
(G-2) Residential septic/toilet waste:
<2,000 gallons $40 + $0.15/gal.
>2,000 gallons $80 + $0.15/gal.
(G-3) Restaurant grease waste:
<2,000 gallons $40 +$0.03/gal.
>2,000 gallons $80 +$0.03/gal.
( )Additional charges to be billed separately if staff time incurred is above that included in the base fee.
(**)Other approved waste will be charged at the residential septic and portable toilet waste rate unless actual strength characteristics
are provided.
Percent change in septage and restaurant grease fees based on an assumed volume of 2,000 gallons.
ReJune 2 p2022 Regular Board Meeting Agenda Packet- Page 75 of 236 Page 5
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ATTACHMENT 3
CENTRAL CONTRA COSTA SANITARY DISTRICT
Report Regarding Environmental and Development-Related
Fees and Charges Update
April 1, 2022
OVERVIEW
The Central Contra Costa Sanitary District (Central San) Board of Directors will soon
consider adopting an ordinance to revise Central San District Code Chapter 6.30,
Schedule of Environmental and Development-Related Fees and Charges (Schedule), for
various environmental and development services.
BACKGROUND
Chapter 6.30 of the District Code includes a schedule of fees and charges for
environmental and development-related services provided to property owners,
contractors, developers, septic and grease waste haulers, and permitted industrial users.
These services include: permitting; plan review; inspection of construction for side sewers
and main line extensions; addition of new sewer, parcel, and permit information to Central
San's maps and related systems; source control permits and inspections; and septic and
grease hauler sampling and treatment.
The fees and charges included on the Schedule are intended to recover Central San's
labor costs, administrative overhead, and other operating expenses incurred in providing
the related services. The extent to which these fees and charges can be adjusted is
limited by California State Law which generally requires that fees and charges do not
exceed the "reasonable costs" incurred in providing the services for which those fees or
charges are levied. For example, following the passage of Proposition 26 in November
2010, language was included in the state Constitution (Article XIII.A, Section 3) requiring
that the cost for any fee or charge "is no more than necessary to cover the reasonable
costs of the governmental activity, and that the manner in which those costs are allocated
to a payor bear a fair or reasonable relationship to the payor's burdens on, or benefits
received from, the governmental activity."
Central San staff reviews the costs required to provide the corresponding services on a
regular basis in order to assess whether changes to the Schedule may be appropriate.
The most recent update to these fees was approved by the Board on June 17, 2021 with
an effective date of July 1 , 2021.
FEE COMPONENTS/STANDARD CALCULATION METHODOLOGY
The majority of fees and charges included on the Schedule are based on salary and
related benefit and overhead costs for staff time and effort. In some cases, additional
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Report Regarding Environmental and Development-Related Fees and Charges
Page 2
April 1, 2022
costs for mileage and other service costs are also included. In a few cases, the fee or
charge represents costs unrelated to labor (e.g., reproduction charges). In all cases, fees
are designed to recover the costs that Central San incurs in providing the related service
during the fiscal year (FY). As a result, fees are based on averages of projected labor,
overhead, mileage, and other costs that are reasonably expected to be incurred. These
component costs are primarily based on the following methodologies:
• Direct Labor: Applicable labor rates are determined using average hourly salary
rates for each employee classification (grade) escalated in conjunction with the
terms of existing labor agreements, including the assumption that any vacant
positions will be filled at Step A of the current grade prior to July 1. The estimated
average hourly salary rates are applied to the hourly staff effort required for each
transaction type in order to determine the related direct labor cost. Where the
efforts of multiple staff are required in a particular transaction, this process is
repeated for each grade level involved.
o The District's current labor agreements include an allowance for annual cost
of living adjustments based on Consumer Price Index (CPI) for the San
Francisco-Oakland-Hayward region as determined by the U.S. Department
of Labor's Bureau of Labor Statistics for each February. The February 2022
published rate is 5.25%1, although existing labor agreements limit the
application of that rate to 5%. Based on publication history, these rates are
typically available by mid-March of each year. Because salary costs for a
portion of FY 2022-23 are dependent on rates which will not be available
until at least March of 2023, this portion of costs is estimated based on
historic trends, existing labor agreement terms, and future assumptions.
• Benefits & Related/Overhead Costs: Employee benefit and related overhead costs
for each transaction type are calculated by applying Central San's Board-approved
administrative overhead rate to the total Direct Labor cost for that transaction as
determined above. The Board-approved overhead rate for FY 2022-23 is 169%2,
down from 177% during FY 2021-22.
• Vehicle & Equipment Costs: The U.S. Internal Revenue Service (IRS) periodically
issues guidance on standard mileage rates applicable to transportation or travel-
related expenses. The applicable rate for calendar year 2022 is $0.585 per mile.
Since vehicle depreciation costs are already captured in Central San's
administrative overhead rate noted above, this same IRS guidance sets a "Basis
Reduction Amount" to reduce this rate by $0.26 per mile in order to prevent over-
recovery of these costs. Applying this reduction decreases the applicable mileage
rate to $0.325 per mile3, up from $0.300 per mile in the previous year.
1 U.S. Department of Labor Bureau of Labor Statistics News Release 22-436-SAN, released on March 10,2022,
available at https://www.bls.gov/regions/west/news-release/consumerpriceindex_sanfrancisco.htm.
Z Central San March 3, 2022 Regular Board Meeting,Agenda Item 3.
3 IRS Notice 2022-03, "2022 Standard Mileage Rates", available at https://www.irs.gov/pub/irs-drop/n-22-03.pdf,
June 2, 2022 Regular Board Meeting Agenda Packet- Page 77 of 236
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Report Regarding Environmental and Development-Related Fees and Charges
Page 3
April 1, 2022
o The IRS mileage rates above are applicable to calendar year 2022. Based
on publication history, the estimated publication date for 2023 guidance is
late 2022. For the purpose of calculating the fees in this Schedule, staff
assumes no change for future years (dates after December 31, 2022).
• Other Costs:
o Outside Recording/Processing Fees: Certain fees (for example, quitclaim,
annexation, property agreements) include a direct pass-through of any fees
that the District is charged in order to record various documents with related
county or other outside offices and agencies.
FEES WITH ALTERNATIVE COST METHODOLOGIES
The calculations for some fees do not follow the methodology described above. These
alternative methodologies include the following:
• Interest Rate — Central San provides various financial assistance agreements to
eligible customers for sewer-related projects, each of which includes an annual
interest charge. The interest rate is determined by calculating the difference (or
"spread") between U.S. Treasury rates for 3-year and 20-year Treasury bills (7-
bills") at the end of the most recent calendar year, adding the quarterly rate
determined by the California State Treasurer for Local Agency Investment Fund
(LAIF) earnings at the end of the same period, plus an additional 0.50% intended
to cover Central San's costs in administering these financing programs4. The
calculated rate is applied to agreements executed during the effective period.
• "No Charge" — Consistent with previous Board direction, some services are
provided at no charge, including:
o Application Fee for Installation of an Overflow Protection Device
o Inspection of an Overflow Protection Device installation
o Industrial User Permit application fee
o Industrial User Permit Class III Permit Fee
• "Actual Expense" — Some activities are so variable or unique to particular
circumstances that a standardized cost estimate cannot be reasonably determined
in advance. Since the overall cost can differ from project to project based on the
actual level of effort required, the fees for these activities are stated as "Actual
Expense". Examples include property annexations and activity related to research
and surveying.
pages 2 and 4 of 5.
4 Previously,this rate was calculated using values for U.S.Treasury and California State LAIF rates reported as of
March 31. Due to the availability of data required to calculate this amount,effective with this year's review the basis
period is being adjusted from March back to the previous December.
June 2, 2022 Regular Board Meeting Agenda Packet- Page 78 of 236
Page 14 of 16
Report Regarding Environmental and Development-Related Fees and Charges
Page 4
April 1, 2022
PROPOSED FEES AND CHARGES
For FY 2022-23, staff recommends various adjustments to the Schedule in order to
account for changes in business processes and related operating costs as described
above. A comparison of the current and proposed fees and charges is included as
Attachment 1 .
There are 88 fees on the current schedule. Staff recommends increases to 56 items,
decreases to 8, elimination of 1 fee and no change to the remaining 23. Staff is also
recommending the inclusion of 2 additional fees. For those items with a pre-determined
fee amount, the overall median adjustment is +4.7%.
Increases
Staff recommends increases to 56 of the current schedule items. These increases range
from +0.4% to +12.4%, with a median increase of +5.3%.
The fee increases included on this schedule are driven primarily by higher labor costs
associated with each related activity. This year's CPI increase reported by the U.S.
Department of Labor resulted in a 5.0% adjustment in salary expenses beginning in late
FY 2021-22 which is slightly offset by a decrease in Central San's administrative
overhead rate noted above. Some salary increases (particularly those for overtime and
other premium salary rates) have a greater upward effect, resulting in a higher-than-
average increase for fees that are heavily driven by premium labor costs. Additionally,
some labor costs are projected to increase because employees in the related job
classifications are projected to achieve a step or longevity increase during the fiscal year.
In some cases, position reclassifications or reassignment of work assignments to staff at
higher grade levels results in additional increases.
The factors noted above have resulted in several above average increases when
compared to the current year fee, including:
• Various Application fees (A-1) (+7.9% to +8.8%): These fee increases are
primarily due to the increased involvement of staff at higher levels due to the
increasing complexity of the reviews performed. Additionally, the Development
Services Supervisor position which has a role in these reviews was recently
reclassified from S-74 to S-75.
• The above-average increases for Special Approvals (A-4) (+8.7%),
Reimbursement Account Transaction Fees (A-6) (+5.5%), Recycled Water Plan
Review (A-2) (+12.4%), and various Inspection and Collection System-related fees
(Sections B and C) (+5.5% to +8.8%) are also caused by similar adjustments to
staff classification and level of effort involved.
• Various Environmental Compliance Review fees (A-8) (+6.8% to +8.8%): The
above-average increases for these fees are primarily driven by work duty
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Report Regarding Environmental and Development-Related Fees and Charges
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reassignments and by applicable longevity increases for longer-term staff,
increasing the average salary rate for the related salary categories.
• This same justification also applies to Industrial Permit (F-2 and F-5) and Septage
Permit (G-1) fee increases of between +5.6% and +8.2%.
Decreases
Staff recommends decreases to 8 of the items on the current Schedule. These
decreases range from -54.4% to -0.4%, with a median of -7.4%.
The primary factors related to these decreases are: realignment of work assignments to
staff at different (lower) average salary levels, adjustments in the scope of a particular
activity reducing staff effort required, or the replacement of incumbent staff by a new hire
at a lower payroll step/longevity level. The most significant decrease calculated is for
System Compatibility Review (A-3) (-54.4%), related to an adjustment in the scope of
work involved which will reduce staff effort required by approximately 50%. Also of note,
the Annual Interest Rate assessed on financing agreements (E-4) will decrease by 18.9%
from 3.22% to 2.61%.
Unchanged
Staff also recommends leaving 23 of the items on the current schedule unchanged.
Seven of these are indicated on the Schedule as fees where "Actual Expenses" are
charged. The remainder either have no charge (e.g. Class III permits for industrial users)
or are nominal amounts normally associated with other billed activities (e.g., $25/$50 for
side sewer cleanout).
Eliminations
Staff recommends eliminating 1 fee from the Schedule (Private Pumping Plan Check (A-
3)) due to a scope change that terminates Central San's involvement in this activity.
Additions
Staff recommends the addition of two fees to the Schedule:
• Mainline Plan Review/ Restart Application (A-2): This fee is intended to allow staff
to reactivate a plan review that was previously closed before it was finalized due to
inactivity on the part of the applicant and where the applicant is now requesting
additional review. Implementing this fee would enable staff to "reactivate" the
review without assessing an additional full review fee since some portion of the
review was previously completed.
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• Recycled Water Inspection / Cross-Connection Testing (13-1): This fee is being
added to reflect an increased level of effort required beyond the fee elements
currently included in the existing Single Inspection Charge calculation in order to
conduct appropriate tests of new recycled water connections.
FINANCIAL IMPACT
The fees and charges on this schedule are intended to recover Central San's labor costs,
administrative overhead, and other operating expenses incurred in providing the related
services. The FY 2022-23 District budget projects approximately $2.2 million in Operating
and Non-Operating Revenues for Schedule-related items, consistent with the $2.2 million
budgeted for these items in the FY 2021-22 budget. Although several fee increases are
requested, a lower level of development is anticipated due to uncertainty in the current
economic climate (specifically related to inflation and interest rates) combined with the
impact of public health and other geo-political factors on future economic conditions.
SUMMARY
If the proposed revisions to the Schedule are adopted, 23 items will remain unchanged,
56 will increase, and 8 will decrease. Additionally, 1 item will be eliminated and 2 new
items will be added to allow for more appropriate fee assessment and cost recovery.
Attached Supporting Document:
1. Comparison of Current& Proposed Fees & Charges for FY 2022-23
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