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HomeMy WebLinkAboutAgenda Packet - November 25, 2002 - UBAGENDA REGULAR MEETING OF AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL AZUSA LIGHT & WATER 729 N. AZUSA AVENUE AZUSA, CA 91702 ---AMENDED--- AZUSA UTILITY BOARD DIANE CHAGNON CHAIRPERSON DICK STANFORD VICE CHAIRPERSON CRISTINA C. MADRID BOARD MEMBER MONDAY, NOVEMBER 25, 2002 6:30 PM DAVE HARDISON BOARD MEMBER IOSEPH R. ROCHA BOARD MEMBER 6:30 p.m. - Convene to Regular Meeting of the Azusa Utility Board and Azusa City Council • Call to Order • Pledge to the Flag • Roll Call 1. PUBLIC PARTICIPATION (PersonlGroup shall be allowed to speak without Interruption up to five (S) minutes maximum time, subject to compliance with appUcable meetingrules. Questions to the speaker or responses to the speaker's questions or comments, shall be handled after the speaker has completed his/her comments. Public Participation will be limited to sixty (60) minutes time.) The Consent Calendar adopting the printed recommended action will be enacted with one vote. /f Staff or Councilmembers wish to address any item on the Consent Calendar individually, it will be considered under SPECIAL CALL ITEMS. IL CONSENT CALENDAR A. Minutes. Recommendation: Approve minutes of regular meeting of October 28, 2002, as written. In H -A. Minutes 10-28-02 B. Amendment of blanket purchase order Issued to Civiltec Engineering, Inc. Recommendation: Authorize an amendment in the amount of $50,000 to blanket purchase order issued to Civiltec Engineering, Inc., for fiscal year 2002-03 to cover engineering costs related to the Northern Transmission Line. II -B. Bid PO Amend re Civftec C. Amendment of Water Division budget for purchases of vehicles or equipment. Recommendation: Authorize amendment of Water Division's budget in amount of $300,000 for vehicle/equipment purchases. WWI II -C. Water Div Budget Amend D. Bid awards for purchase of various trucks for Water Division. Recommendation: Award the purchase of 3 one -ton gasoline powered 2003 service trucks in amount of $71,214.45, and 1 diesel powered 2003 welding truck in amount of $42,627.77, to Wondries Fleet Group; award the purchase of 1 diesel powered dump truck to Peck Road Truck Center in amount of $53,851.12. E=j II -D. Water Trks Purch E. Refunding of 1993 Revenue Bond. Recommendation: Authorize City's Investment Committee to engage E.J. De La Rosa & Company to proceed with refunding of the 1993 Revenue Bond that was used to acquire Azusa Valley Water Company. II -E. Bond Refunding I � e F. Low Income Home Energy Assistance Program. Recommendation: Approve resolution authorizing Assistant Director of Customer Care and Solutions to execute an agreement with the State Department of Community Services and Development to receive direct payment for Low -Income Home Energy Assistance Program (LIHEAP) for three -years. In II -F. Low Inc Horne Energy Asstnc Frog III. SCHEDULED ITEMS A. AMENDED ITEM --Continued Consideration of Proposed Resolution for Ballot Measure for March 4. 2003 General Municipal Election to Ratify and Amend the Utility Users Tax. Recommendation: This item is continued from November 18, 2002, City Council meeting, at which the City Council considered attached resolution to place a measure on the March 4, 2003 ballot to amend the Utility Users Tax. III -A. CM's Rpt III -A. Reso III -A. Ordinance B. Request for Proposals on long-term firm power. Recommendation: Authorize staff to issue a Request for Proposals (RFP) to seek offers for long-term firm power. C III -C. RFP IT Firm Power IV. STAFF REPORTS/COMMUNICATIONS A. Project Updates IV -A. WCA Tree Maint Rpt.pdf B. Customer Billing Complaint regarding Mrs. Cabrera. IV -B. Mrs. Cabrera Billing Adjnnt C. Customer Service Business Hours TLED IV -C. Cus Svc Bus Hrs Rpt D. Monthly Power Resources Update and Status of Projects Report V. DIRECTORS' COMMENTS VI. CLOSED SESSION --AMENDED A. Conference with Real Property Negotiators Pursuant to Government Code Section 54956.8 Property: Ground water rights within the boundaries of the real property commonly known as Monrovia Nursery in the City of Azusa. Negotiating property owner: Miles Rosedale City Negotiators: Rick Cole and Joe Hsu Under negotiation: Price and terms of acquisition B. Conference with Legal Counsel regarding pending litigation pursuant to Government Code Section 54956.9(x) Res Care, Inc. v. City of Azusa Case No. KC040062 VII. ADIOURNMENT A. Adjournment. %n compliance with the Americans with Disabilities Act, ifyou need special assistance to participate in a city meeting, please contact the City Clerk at 626-812-5229. Notification three (3) working days prior to the meeting or time when special services are needed will assist staff in assuring that reasonable arrangements can be made to provide access to the meeting. " IV -D. Moly Power Status of Resources Update Projects. ppt V. DIRECTORS' COMMENTS VI. CLOSED SESSION --AMENDED A. Conference with Real Property Negotiators Pursuant to Government Code Section 54956.8 Property: Ground water rights within the boundaries of the real property commonly known as Monrovia Nursery in the City of Azusa. Negotiating property owner: Miles Rosedale City Negotiators: Rick Cole and Joe Hsu Under negotiation: Price and terms of acquisition B. Conference with Legal Counsel regarding pending litigation pursuant to Government Code Section 54956.9(x) Res Care, Inc. v. City of Azusa Case No. KC040062 VII. ADIOURNMENT A. Adjournment. %n compliance with the Americans with Disabilities Act, ifyou need special assistance to participate in a city meeting, please contact the City Clerk at 626-812-5229. Notification three (3) working days prior to the meeting or time when special services are needed will assist staff in assuring that reasonable arrangements can be made to provide access to the meeting. " is O ANNUAL TREE MAINTENANCE HIGHLIGHT REPORT City of Azusa —Utilities Department 2001-2002 FISCAL YEAR HIGHLIGHTS The City of Azusa Utilities Department and West Coast Arborists, Inc. have been working together for over two years. Systematic tree maintenance re- duces the long term expenses of the ur- ban forest while maintaining the financial value of one of the City's most valuable assets: trees. This pro -active approach to managing the urban forest improves public relations, provides equitable ser- vice to the community, reduces liability exposure, and improves urban forest health. Throughout the past fiscal year, West Coast Arborists, Inc. pruned over 2,000 trees in accordance with the 2001-2002 fiscal year contract. 2001-2002 MAINTENANCE RECAP • Pruned 2,042 trees Removed 5 trees CUSTOMER RELATIONS As a company, we pride ourselves on out- standing customer ser- vice. As part of this program, we have re- ceived numerous letters from happy homeown- ers throughout the City. Azusa residents, Victor 81 Eva Subia write, 1 would like to commend the Foreman and his crew on the outstanding job they performed trimming our trees. We were notified of a schedule date and time for the tree trimming which gave us plenty of time to prepare for their arri- val. The Foreman was extremely patient while trimming the trees and avoided dropping large limbs that could have damaged our fawn area. When the job was finished he and his crew did an ex- ceptional job of cleaning up the debris. " WORK PERFORMED BY MONTH Jul A, Sep Oct Nw Cec Jan Feb Mer Apr M., Jw Q Trimming ❑ Removals 15 Planting I Team NNI in the City of Azusa #1 SPECIE PRUNED Of the 2,042 trees pruned this fiscal year, 288 were Fraxinus andels, making them the number one species pruned. The Shamel Ash Flourishes in full sun and can withstand aridity but thrives on mois- ture. This evergreen tree grows fairly fast and can eventually reach up to 80 feet or more. With its spreading form, this upright, narrow tree is shallow rooted so deep watering is encouraged. TOP 10 SPECIES PRUNED AMERICAN SVEETGUM COAST LIVE OAK 1% AVOCA00 CYPRESS 8% S% JACARANDA a% rw CHINESE ELM 10% SHAMEL ASH EUCALYPTUS 24% 11% TREE OF HEAVEN PINE Jt% trn West Coast Arborists, Inc.: "Tree Care Professionals Serving Communities Who Care About Trees" COMPUTER SOFTWARE WCA developed a Microsoft -compatible program based on the needs of our cus- tomers. ArborAccess is a tool available that is useful for managing the urban for- est Because the program was designed by WCA, we have the capability to mod- ify and improve it in response to our cus- tomer's. The user-friendly program can store, retrieve, update, delete and add tree records and work histories. As part of our Complete Urban Forestry Man- agement Program, the tree inventory and work history is updated automatically with each invoice that is received. This eliminates the city staff from having to manually update the work history por- tion of the tree inventory and keeps the inventory current. TREE INVENTORY The success of any urban forest manage- ment program depends on the manage- ment of information. Such information allows the City to make significant deci- sions on tree -related issues. Daily record keeping, maintenance scheduling and re- porting are required to operate an effec- tive urban forest tree care program. A unique feature of our program is that the tree inventory is automatically updated with each billing period, as work is per- formed, saving the City time and money maintaining the tree inventory. GLOBAL POSITIONING SYSTEM (GPS) In addition to the standard tree inven- tory, WCA can also collect inventories using Global Positioning Systems. The inventory can be linked directly to a Geographical Information System (GIS) such as ArcView. The trees are identi- fied by their global coordinates of longi- tude and latitude within one meter. The City can then overlay the tree inventory with other infrastructure assets. A sam- ple report is shown at right. MASTER STREET TREE PLAN The goal of the Master Street Tree Plan Is to develop an effective tree care pro- gram consistent with the City's objectives and to provide options to minimize maintenance costs. It is intended to pro- tect the value of existing trees and pro- vide a method of enhancement for the future. Accurate analysis of the present tree population permits forecasting for future maintenance needs. The steps used in compiling the Master Street Tree Pian are: • SET GOALS at ESTABLISH GUIDEUNES • CREATE A SPECIE PALETTE • COLLECT DATA • SPECIE RECOMMENDATION BI SELECTION • COMPILE MASTER STREET TREE PLAN DRAFT • CITY COUNCIL APPROVAL • COMMUNrrY OUTREACH • SUCCESSFUL REFORESTATIONI MODEL SAFETY ENVIRONMENT Safety standards are a top priority at WCA. Our line of work demands that all work is performed in a manner that pro- vides the maximum safety to the general public as well as our employees. Our crews are instructed to follow the safety standards of ANSI Z133.1 as well as Cal -OSHA requirements. We have one of the most extensive safety training pro- grams in the industry. We provide our employees with state-of-the-art training and instructional sessions company -wide. URBAN FORESTRY PROFESSIONALS West Coast Arborists is successful be- cause of its employees. We employ over 30 Certified Arborists and 100 Certified Treeworkers. The International Society of Arboriculture certification provides an educationally challenging program de- signed to upgrade the knowledge and proficiency levels in the tree care profes- sion. The Treeworker Certification is to establish a meaningful standard of skill and work quality, and to promote safe work practices. In an effort to provide the best possible tree care, WCA hires, trains, and assigns Certified Treeworkers and Arborists on all of our projects. This insures that a higher level of service has been obtained and that safe work prac- tices will be performed. R I rPPrt A�r�or et 4r argo �^I,�q 1Z AM CITY OF AZUSA MINUTES OF THE REGULAR MEETING OF THE AZUSA UTILITY BOARD/CITY COUNCIL MONDAY, OCTOBER 28, 2002 - 6:30 P.M. The Utility Board Members of the City of Azusa met in regular session, at the above date and time In the Azusa Light and Water Department Conference Room, located at 729 N. Azusa Avenue, Azusa, California. Chairperson Chagnon called the meeting to order. Call to Order ROLL CALL Roll Call PRESENT: COUNCILMEMBERS: HARDISON, STANFORD, ROCHA, CHAGNON, MADRID ABSENT: COUNCILMEMBERS: NONE Also Present ALSO PRESENT: City Attorney Carvalho, City Manager Cole, Assistant City Manager Person, Director of Utilities Hsu, Assistant to the Director of Utilities Kalscheuer, Assistant Director of Water Operations Anderson, Assistant Director of Customer Care and Solutions Vanca, Assistant Director of Resource Management Tang, Assistant Director of Electric Operations Ramirez, Deputy City Clerk Toscano, City Clerk Mendoza. Public Participation Pub Part Mrs. Cabrera, addressed Utility Boardmembers regarding her billing for electric service. She Mrs. Cabrera noted inconsistencies in her billing for last two years and asked for an explanation from Utility Comments staff. Discussion was held between Boardmembers, staff and Mrs. Cabrera regarding the Issue. It was consensus that the matter be referred back to staff to look at a two year average of the billing and work out a solution for payment, have automatic reader checked and meet with Mrs. Cabrera to work out the problem. 005 Ms. Suzanne Avila addressed the Utility Boardmembers providing and update on the San Gabriel S. Avila = River. The projects included: Gateway Interpretive Center and Gardens (Forest Service Update Information center), River Wilderness Park, Bike Path Extension and Spreading Basins. Other SG River Involvements included: City of Azusa Extended Duties, Legislative Contacts and Conservation Contacts. The CONSENT CALENDAR consisting of Item 11-A through 11-0, were approved by motion of Consent Councilmember Stanford, seconded by Mayor Madrid, and unanimously carried with the Calendar exception of items D, H, and N, which were considered under the Special Call portion of the Agenda. A. The minutes of the regular meeting of September 23, 2002, were approved as written. Min appvd B. Notice of completion for lighting retrofits was accepted and approved and authorization was Ntc Comp given for final payment of $11,885.75 to California Retrofit, Inc. Calif. Retrofit C. Notice of completion for heating, ventilation and air conditioning (HVAC) retrofits was Ntc Comp accepted and approved and authorization was given for final payment of $20,868.60 to ALP ALP A/C Heating and Air Conditioning. D. SPECIAL CALL ITEM. Spec Call E. Budget amendment for water purchases was approved and authorization was given to amend Budget the budget in the amount of $500,000 to cover increased cost of purchased water expenses Amend for Fiscal Year 2002-03. F.. Amendment to blanket purchase order issued to Upper San Gabriel Valley Municipal Water Amend District (USGVMWD) was authorized in the amount of $75,000 to cover increased purchased P.O. water costs. USGVMWD G. Budget amendment for Line Mechanic was approved in the amount of $28,410 to cover Budget salary and benefits for a temporary Line Mechanic. Amend H. SPECIAL CALL ITEM. Spec Call 1. Specifications for the purchase of 3 one ton gasoline powered service trucks, ldiesel Specs powered welding truck, and 1 diesel powered dump truck were approved and advertisement Purchase for bids was authorized. Trucks J. Approval was given to purchase 0.85 acres of property from the City of Pasadena for Purchase purchase price of $46,000. Property K. A RESOLUTION OF THE AZUSA UTILITY BOARD/CIN COUNCIL OF THE CITY OF AZUSA, Res. 02-C124 AMENDING SCHEDULE OF CHARGES AND RULES AND REGULATIONS GOVERNING THE NSF Check ELECTRIC AND WATER SERVICE SUPPLIED BY AZUSA LIGHT & WATER. Charges L. A RESOLUTION OF THE AZUSA UTILITY BOARD/CITY COUNCIL OF THE CITY OF AZUSA, Res. 02-C125 AUTHORIZING THE DESTRUCTION OF CERTAIN CITY RECORDS. Destroy Rcds M. A RESOLUTION OF THE UTILITY BOARD/CITY COUNCIL OF THE CITY OF AZUSA, ACCEPTING Res. 02-C 126 CERTAIN GRANT OF EASEMENT AND DIRECTING THE RECORDING THEROF. Grant of Esmt N. SPECIAL CALL ITEM. 10/28/02 PAGE TWO Spec Call 1M O: Professional Services contract with Ryerson, Master and Associates was approved in the Ryerson, amount of $96,000, to conduct EPA mandated Water System Vulnerability Assessment. Master & Assoc. Special Call Items Special Call Assistant to the Director of Utilities Kalscheuer responded to questions posed regarding School C. Kalscheuer Recycling Program Expansion. He stated that last year the City purchased three School compartmentalized recycling containers for three schools and that they liked them so much that Recycling they have asked that the City use their recycling grant funds to purchase an additional six Program containers for six schools. The contract with Athens Services allows the City to have six schools serviced under the Franchise Agreement and this would complete the obligations under the agreement. The containers divide newspaper, mixed color paper, aluminum cans and plastics. He added that the School District is serviced by another waste hauler and they are not going through the MRF. Moved by Councilmember Hardison, seconded by Chairperson Chagnon and unanimously carried School Dist. to approve the School District's proposed recycling program, amend waste management division Recycling budget by $8,000, and authorize issuance of purchase order to Protainer, Inc. up to $25,890 for Program purchase of recycling containers for six schools. Approved Utilities Director Hsu and Assistant Director of Water Operations Anderson responded to J. Hsu & questions regarding the Quitclaim of Easements for property on Azusa —San Gabriel Road. The C. Anderson stated that the water utility easements were deeded to Azusa Land Development Company, Quitclaim predecessor of Azusa Valley Water, (which the City obtained). The easements are from a ditch to Easements the property and the property doesn't take ditch water anymore. The property owner wants the Property on City to conduct the deed. Councilmembers advised that that next time it would be helpful if the Azusa -SG Item includes an address, name of property owner and dates. Moved by Councilmember Hardison, seconded by Chairwoman Chagnon and unanimously carried Easements to authorize Director of Utilities to sign quitclaim easements for Parcel No. 8684-023-010. Approved Mayor Madrid asked questions regarding item J, Purchase of property from City of Pasadena, Mayor Item K, Non -Sufficient fund return check charges, and M, Grant of Easement from the Alonzo questions family, which staff responded to appropriately. Chairwoman Chagnon addressed item regarding a budget amendment for Executive Management Exe Mgmt Training in the amount of $24,900. She asked the status of computer training for regular Training employees and stated that she wants to make sure there is on-going in-house training for & Employee employees. Training Moved by Councilmember Hardison, seconded by Chairwoman Chagnon and unanimously carried Training to approve a budget amendment in the amount of $24,900 for Executive Management Staff approved Leadership Training contingent upon City Employees also receiving on-going in-house training. Scheduled Items Sched Items City Manager Cole addressed Councilmembers detailing item.regarding the consideration of City Mgr potential ballot measure. He detailed the history of the Utility Users Tax and recommended that Ballot the Council schedule public consideration of a ballot measure to be placed on the March ballot Measure that would: Reduce the rate for residential electric, water and gas from 5% to 4%, Increase the Utility Tax rate for commercial electric water and gas from 5% to 8%, and apply the commercial rate to 3/03 commercial telephones and wireless devices. ballot 10/28/02 PAGE THREE 007 He also recommended that the City appoint a community "Tax Reform Task Force" to work with Tax Reform the Council and staff on a broader tax reform plan to be put before voters in November 2003. He Task Force explained the need to find out where people stood on the issue. 11/03 Discussion was held between Councilmembers and staff regarding a Tax Review Task Force Discussion instead of Tax Reform Task Force. It was suggested that the work "Reform" be changed to "Review". Further that all persons involved, i.e. business owners, etc., should be included in the Tax Review Task Force. City Attorney Carvalho was directed to research what the State of California allows for exemptions. Moved by Councilmember Stanford, seconded by Councilmember Rocha and unanimously Ballot carried to schedule public consideration of a ballot measure to be placed on the March ballot that Measure would: 1) Reduce the utility users tax rate for residential electric, water and gas from 5% to 4'/0, Re: Utility 2) increase the utility users tax rate for commercial electric water and gas from 5% to 8%, and 3) Tax Apply the commercial rate to commercial telephones and wireless devices. approved Moved by Mayor Madrid, seconded by Councilmember Rocha and unanimously carried that the Tax Review City appoint a community "Tax Review Task Force" to work with the Council and staff on a Task Force broader tax reform plan to be put before voters in November 2003. It was noted that staff would Approved like to include writing letters, having meetings, and conducting surveys regarding the proposed November ballot measure. Chairperson Chagnon dissented on the survey part of the issue. Assistant Director of Customer Care and Solutions Vanca addressed the Boardmembers relaying a dilemma for employees who have to come in early and leave late because of current office hours. She stated that currently, the office opens for business at 7 a.m. and closes at 5:30 p.m., but, there is a need for employees to conduct certain preliminary procedures before the office opens and other office closure procedures at the end of the day. She stated that customers are usually lined up at the door first thing in the morning and other customers are usually there up until 5:30 p.m. This causes some employees to have to come in early and leave late, which causes an unfair work environment. She requested that the business hours of operation be modified to 7:15 a.m. — 5:15 p.m., effective February 1, 2003, for a three-month trial period. Discussion was held between Councilmembers and staff regarding the issue. It was consensus Councilmembers motto approve the item. Councilmembers asked staff to come back at next meeting with an idea of how to address morale issues with regards to the subject. Assistant Director of Customer Care and Solutions Vanca detailed the development of cashiering standards created by an employee team. She stated that the team determined the purpose of having cashiering goals, created definitions for excusable and inexcusable outages, and benchmarked cashier standards with other utilities and companies. The Team also created a program containing elements of teamwork, personal challenge, and a reward mechanism for success. Discussion was held between Councilmembers and staff. Moved by Councilmember Stanford, seconded by Councilmember Stanford and carried to approve the proposed Cashiering Standards and Rewards Program for Customer Service Representatives. Mayor Madrid and Councilmember Rocha dissented. Motion is predicated on seeing what is being done in other divisions. Staff was directed to look into cashing standards throughout the organization and bring back information to another Utility Board Meeting. Staff Reports/Communications Director of Utilities Hsu addressed Item regarding the review of alternative site for new Light and Water Electric office building, requesting that staff be allowed to review the property at 1020 W. Tenth Street as a possible alternate site. He provided details about the site. 10/28/02 PAGE FOUR Proposed Change of Office hours L8 W Denied Cashiering Standards And Rewards Program Staff Rpts Dir of Util L8W Elect. Office Moved by Councilmember Stanford, seconded by Councilmember Hardison and unanimously Review carried to allow staff to conduct a review of the property at 1020 W. Tenth Street as a possible Alternative alternative site for the new electric office building. site Director of Utilities Hsu provided an update on the audit of Athens Services' disposal report Update on stating that the City is still going forward with the Athens audit: He stated that Athens has Athens' Audit submitted data to the County, but, not to the City, further, they still have not identified how many tons they have diverted. It was consensus that the staff report submitted was received and filed. Director of Utilities Hsu provided Council with a report on the Water Utility Real Property, Utilities Dir information item on the annual adjustment of replacement water cost adjustment factor and the Comments Monthly Power Resources Update. He advised that with regard the San Juan Project, both sides have signed an agreement, representatives from San Juan Project will be coming to speak to Bob Tang and also attend the SCPPA meeting the next day. He then provided an update on the facility on Gladstone that will be used for the Sub -Station, the old Cities Tow. It was consensus of Councilmember to recess to Closed Session to discuss the following: CONFERENCEWITH LEGAL COUNSEL—ANTICIPATED LITIGATION (Gov. Code Sec. 54956.9 Closed Sess (b) One Case. The City Council recessed at 8:52 p.m. Recess The City Council reconvened at 9:45} p.m. Reconvened City Attorney Carvalho advised that there was no reportable action taken in Closed Session. No Rpts It was consensus of Councifinembers to adjourn. Adjourn TIME OF ADJOURNMENT: 9:49 P.M. SECRETARY NEM RESOLUTION NO. O2 -C124. 10/28/02 PAGE FIVE 11' CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 SUBJECT: APPROVAL OF $50,000.00 AMENDMENT TO BLANKET PURCHASE ORDER TO CIVILTEC ENGINEERING, INC. RECOMMENDATION It is recommended that the Utility Board/City Council authorize an amendment in the amount of $50,000.00 to the Blanket Purchase Order issued to Civiltec Engineering, Inc. for fiscal year ending June 30, 2003. BACKGROUND Civiltec Engineering, Inc. has performed engineering services for the Water Division in conjunction with the Northern Transmission Line project, which the Water Division has funded through the Blanket Purchase Order. Expenditures for these services have been reimbursed by a third party. Amending the Purchase Order will allow for additional engineering services during the ensuing year. FISCAL IMPACT There will be no fiscal impact. Prepared by: Phyllis Bradley Administrative Services Supervisor CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES4�77p� DATE: NOVEMBER 25, 2002 1� SUBJECT: APPROVE $300,000.00 BUDGET AMENDMENT FOR VEHICLE/EQUIPMENT PURCHASES RECOMMENDATION It is recommended that the Utility Board/City Council authorize a Budget Amendment in the amount of $300,000.00 for Vehicle/Equipment purchases. BACKGROUND During the preparation of the 2002-2003 CIP Budget, the Water Division listed amounts for anticipated purchases of necessary vehicles or equipment. At that time the Finance Department opted to have future vehicle purchases listed as line items in the Operations Budget. These amounts were subsequently removed from the CIP Budget listing but never transferred to the Division's Operations Budget. FISCAL IMPACT Fiscal Impact will be up to $300,000.00. Funds for this Amendment will be transferred from retained earnings. Prepared by: Phyllis Bradley Administrative Services Supervisor Oil CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 SUBJECT: AWARD BID &AUTHORIZE PURCHASE OF (3) 2003 ONE TON GASOLINE POWERED SERVICE TRUCKS, (1) GVRW 15,000 LB. PAYLOAD, DIESEL POWERED WELDING TRUCK AND (1) 5-6 YARD DIESEL POWERED DUMP TRUCK RECOMMENDATION It is recommended that the Utility Board/City Council accept the bids as received and -award the purchases to the lowest bidders as follows: (3) 2003 One Ton gasoline powered service trucks from Wondries Fleet Group in the amount of $71,214.45, (1) 2003 GVRW 15,000 Ib. payload, diesel powered welding truck also from Wondries Fleet Group In the amount of $42,627.77 and (1) 2003 5-6 yard diesel powered Dump Truck from Peck Road Truck Center In the amount of $53,851.12. Total purchase price for all 5 vehicles - $167,693.34. BACKGROUND At Its regular meeting on October 28, 2002, the Utility Board/City Council approved the specifications and authorized formal bidding for the above subject vehicles. As directed, the City Clerk published a Notice Inviting Bids on November 7, 2002. Bid packages were also mailed directly to fleet managers of local auto/truck dealers. 2 Bids received were as follows: (3) One Ton Gasoline Powered Service Trucks Fritts Ford $74,691.14 Peck Road Truck Center $79,820.30 Wondries Fleet Group $71,214.45 (1) GVRW 15,000 Ib Payload, Diesel Powered Welding Truck Fritts Ford $44,464.86 Peck Road Truck Center $45,148.91 Wondries Fleet Group $42,627.77 (1) 5-6 Yard Diesel Powered Dump Truck Fritts Ford No bid submitted Peck Road Truck Center $53,851.12 Wondries Fleet Group $58,474.49 FISCAL IMPACT Fiscal impact will be $167,693.34. Sufficient funds are available in the Water Division's Vehicle Replacement CIP Budget. Prepared by: Phyllis Bradley Administrative Services Supervisor 013 CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 SUBJECT: REFUNDING OF REMIANING 1993 REVENUE BONDS (ACQUISITION OF AZUSA VALLEY WATER COMPANY) It is recommended that the Utility Board/City Council authorize the City's Investment Committee to engage E. J. De La Rosa & Co. to proceed with the refunding of the 1993 Revenue Bond. BACKGROUND In 1993, the Azusa Public Financing Authority issued $24,075,000 of Revenue Bonds for the City of Azusa to acquire Azusa Valley Water Company. Of these bonds, $20,130,000 remains outstanding at an average interest rate of 5.42%. Interest rates have since declined towards 40 -year historical lows, and these bonds can now be refinanced to achieve debt service savings. E. J. De La Rosa & Co. presently is also working with the City's Investment Committee for the issuance of Mountain Cove's Community Facility District bonds. It is one of the three bankers that submitted 1993 Revenue Bonds refinancing proposals and its proposal was selected by the Investment Committee for the City Council/Utility Board's approval. FISCAL IMPACT Based on current market conditions the Refunding bonds could currently be sold at an average Interest rate of 4.23%, saving 1.49% in annual Interest rates. These savings translate to $77,000 per year, totaling $1.03 million of net present value savings, or 5.13% of the refunded par amount of bonds. Prepared by: J. Hsu 014 i F., CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 N SUBJECT: LOW INCOME HOME ENERGY ASSISTANCE PROGRAM RECOMMENDATION It Is recommended that the Azusa Utility Board/City Council approve a three-year contract to use the Direct Payment Process to accept payments electronically for customers qualifying for the State of California Department of Community Services and Development's Low -Income Home Energy Assistance Program. BACKGROUND A number of Azusa Light & Water low-income customers have applied for utility payment assistance from the State of California Department of Community Services and Development's Low -Income Home Energy Assistance Program (LIHEAP). The Department of Community Services and Development (CSD) has requested utilities consider allowing them to use the Direct Payment Process for making these payments to our utility. The current process is that CSD addresses both the customer and Azusa Light & Water as co - payees on the check. The check is sent directly to the customer, who brings it to our office as payment. This process can be streamlined by doing it electronically and save customers the trip of coming to the Light & Water office. FISCAL IMPACT There is no fiscal impact to using the Direct Payment Process. Prepared by: Karen Vanca, Assistant Director Customer Care & Solutions// �� 015 RESOLUTION NO A RESOLUTION O F THE AZUSA U TILITY B OARDICITY COUNCIL OF THE CITY OF AZUSA, TO USE THE DIRECT PAYMENT PROCESS FOR RECEIVING LIHEAP PAYMENTS FROM THE STATE OF CALIFORNIA. WHEREAS, the Utility Board/City Council supports streamlining operations; and WHEREAS, the Utility Board/City Council supports providing customer service at the highest level. Now, Therefore, be it resolved that the Utility Board/City Council authorizes the Assistant Director Customer Care & Solutions to execute an agreement with the State Department of Community Services and Development to receive direct payment of LIHEAP payments. Effective Date. The contract will be effective on December 1, 2002. PASSED, APPROVED AND ADOPTED this 25th day of November 2002. Cristina C. Madrid Mayor ATTEST: Vera Mendoza City Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES )ss - CITY ss.CITY OF AZUSA ) 016 I, Vera Mendoza, City Clerk of the City of Azusa, do hereby certify that the foregoing Resolution No. was duly introduced and adopted at a regular meeting of the Azusa Utility Board/City Council on the 25th day of November 2002, by the following vote, to wit: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: Vera Mendoza City Clerk 017 11/18/02 08:03pm P. 001 Direct Payment City of Azusa Agreement No. 03-1166 STATE OF CALIFORNIA AGREEMENT This Agreement is entered into between the State Agency, Department of Community Services and Development, and the Utility Company named below: Utility Company: Azusa Light and Water The term of this Agreement is: December 1, 2002 through June 30, 2005 The maximum amount of this Agreement is: S -0 - Agreed to and approved: 0 Authorized Signature Printed Name and Title of Person Signing Address: Telephone: Facsimile: Date Signed STATE OF CALIFORNIA, DEPARTMENT OF COMMUNITY SERVICES AND DEVELOPMENT 0 Authorized Signature Timothy M. Dayonot, Director Printed Name and Title of Person Signing Address: 700 North Tenth Street Sacramento, CA 95814-0338 Telephone: (916) 341-4200 Facsimile: (916) 327-3153 Date Signed \\Cobra\Shared\Contracts\Direct Payment\Boilerplate Agreement Covershoet.doc HE Exhibit A (Agreement) SCOPE OF WORK Direct Pay City of Azusa Agreement No. 03-1166 The purpose of this Agreement between the Department of Community Services and Development, hereafter referred to as CSD, and the Azusa Light and Power, hereafter referred to as Contractor, is for the purpose of making direct credit to the accounts of low-income energy customers of the City of Azusa that are identified by the Department as payment recipients under the Department's Low -Income Home Energy Assistance Program (LIHEAP), which includes the Home Energy Assistance Program (HEAP) and Energy Crisis Intervention Program — Fast Track (ECIP-FT). 2. A. CSD will process applications and make a determination of applicant's eligibility for assistance based upon preestablished criteria pursuant to California's Low -Income Home Energy Assistance Program. CSD will provide the Contractor with a printout (transmittal) that lists applicants determined eligible for assistance and the amount of assistance. Payment, in the form of a State of California warrant, shall accompany the printout, and Summary Report, and shall represent the sum total of benefits contained on said transmittal. B. CSD will process applications on a system that is compliant with the Year 2000 requirements. C. Contractor will process payments contained on aforementioned printout in accordance with the provisions of the LIHEAP Direct Payment instructions. D. Contractor will provide notification of LIHEAP payment to each customer for whom a credit is made. The wording of said notification must contain the words "LIHEAP credit." Disbursements Funds provided under this Agreement shall be disbursed and applicant accounts credited in accordance with the provisions of the LIHEAP Direct Payment instructions. 4. Assurances A. Contractor shall charge the eligible household, in the normal billing process, the difference between the actual cost of the home energy and the payment amount made by the Department. The actual costs of the home energy shall not exceed the customary cost charged by the industry for energy to consumers in the geographical area in which the energy is provided. Al 019 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit A (Agreement) B. Contractor assures that no household receiving assistance under this process will be treated adversely because of such assistance under applicable provisions of State Law regarding public regulatory requirements. 5. Reports Reports required under this Agreement are detailed in the LIHEAP Direct Payment instructions and the attachments thereto. \\Cobra\Shared\Contracts\Duect Payment\City of Azusa Exh A.doc A2 020 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit B (Agreement) BUDGET DETAIL AND PAYMENT PROVISIONS Payment Contractor will not receive any consideration under this Agreement. Address for the State Unless otherwise required by the LIHEAP Direct Payment Instructions and the attachments thereto, Contractor shall send notes and/or correspondence to: Department of Community Services and Development Attn. Jason Wimbley, Manager, Program Services and Support Unit 700 North Tenth Street, Room 258 Sacramento, California 95814-0338. CSD's Proiect Manager The Manager of the Program Services and Support Unit is designated as the Department's Project Coordinator. The Department may, at any time, designate a substitute Project Coordinator. . 4. Contractor's Project Coordinator Karen Vanca, is designated as the Contractor's Project Coordinator. The Contractor may, at any time, designate a substitute Project Coordinator. \\Cobra\Shared\Contracts\Direct Payment\City of Azusa Exb B.doc B1 021 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit C (Agreement) GENERAL TERMS AND CONDITIONS Approval This Agreement shall become a valid, enforceable agreement only after both parties sign it. Amendment No amendment or variation of the terms of this Agreement shall be valid unless made in writing, signed by the parties, and approved as required. No oral understanding or Agreement not incorporated in the Agreement is binding on any of the parties. Assignment This Agreement is not assignable by the Contractor, either in whole or in part, without the consent of the State in the form of a formal written amendment. 4. Audit Contractor agrees that the awarding department, the Department of General Services, the Bureau of State Audits, or their designated representative shall have the right to review and to copy any records and supporting documentation pertaining to the performance of this Agreement. Contractor agrees to maintain such records for possible audit for a minimum of three (3) years after final payment, unless a longer period of records retention is stipulated. Contractor agrees to allow the auditor(s) access to such records during normal business hours and to allow interviews of any employees who might reasonably have information related to such records. Further, Contractor agrees to include a similar right of the State to audit records and interview staff in any subcontract related to performance of this Agreement. (Government Code Section 8546.7, Public Contract Code Section 10115 et seq., California Code of Regulations Title 2, Section 1896) Indemnification Contractor agrees to indemnify, defend, and save harmless the State, its officers, agents, and employees from any and all claims and losses accruing or resulting to any and all contractors, subcontractors, suppliers, laborers, and any other person, firm, or corporation furnishing or supplying work services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm, or corporation who may be injured or damaged by Contractor in the performance of this Agreement. Cl, 022 Exhibit C (Agreement) Disputes Direct Pay City of Azusa Agreement No. 03-1166 Contractor shall continue with the responsibilities under this Agreement during any dispute. Termination for Cause The State may terminate this Agreement and be relieved of any payments should the Contractor fail to perform the requirements of this Agreement at the time and in the manner herein provided. In the event of such termination the State may proceed with the work in any manner deemed proper by the State.' All costs to the State shall be deducted from any sum due the Contractor under this Agreement and the balance, if any, shall be paid to the Contractor upon demand. Independent Contractor Contractor, and the agents and employees of Contractor, in the performance of this Agreement, shall act in an independent capacity and not as officers or employees or agents of the State. 9. Nondiscrimination Clause During the performance of this Agreement, Contractor and its subcontractors shall not unlawfully discriminate, harass, or allow harassment against any employee or applicant for employment because of sex, race, color, ancestry, religious creed, national origin, physical disability (including HIV and AIDS), mental disability, medical condition (cancer), age (over 40), marital status, and denial of family care leave. Contractors and subcontractors shall insure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment. Contractor and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code Section 12990 (a -f et seq.) and the applicable regulations promulgated thereunder (California Code of Regulations, Title 2, Section 7285 et seq.). The applicable regulations of the Fair Employment and Housing Commission implementing Government Code Section 12990 (a -f), set forth in Chapter 5 of Division 4 of Title 2 of the California Code of Regulations, are incorporated into this Agreement by reference and made a part hereof as if set forth in full. Contractor and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. Contractor shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under the Agreement. 023 C2 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit C (Agreement) 10. Timeliness Time is of the essence in this Agreement. 11. Compensation The consideration to be paid Contractor, as provided herein, shall be in compensation for all of Contractor's expenses incurred in the performance hereof, including travel, per diem, and taxes, unless otherwise so provided. 12. Governing Law This Agreement is governed by and shall be interpreted in accordance with the laws of the State of California 13. Child Support Compliance Act For any Agreement in excess of $100,000, the contractor acknowledges in accordance with, that: a) The contractor recognizes the importance of child and family support obligations and shall fully comply with all applicable state and federal laws relating to child and family support enforcement, including, but not limited to, disclosure of information and compliance with earnings assignment orders, as provided in Chapter 8 (commencing with section 5200) of Part 5 of Division 9 of the Family Code; and b) The contractor, to the best of its knowledge is fully complying with the earnings assignment orders of all employees and is providing the names of all new employees to the New Hire Registry maintained by the California Employment Development Department. 14. Unenforceable Provision in the event that any provision of this Agreement is unenforceable or held to be unenforceable, then the parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. C3. 024 Exhibit C (Agreement) 15. Union Organizing Direct Pay City of Azusa Agreement No. 03-1166 For all contracts, except fixed price contracts of $50,000 or less, the Contractor acknowledges that: By signing this agreement Contractor hereby acknowledges the applicability of Government Code Section 16645 through Section 16649 to this agreement and agrees to the following: a) Contractor will not assist, promote or deter union organizing by employees performing work on a state service contract, including a public works contract. b) No state funds received under this agreement will be used to assist, promote or deter union organizing. C) Contractor will not, for any business conducted under this agreement, use any state property to hold meetings with employees or supervisors, if the purpose of such meetings is to assist, promote or deter union organizing, unless the state property is equally available to the general public for holding meetings. d) If Contractor incurs costs, or makes expenditures to assist, promote or deter union organizing, Contractor will maintain records sufficient to show that no reimbursement from state funds has been sought for these costs, and that Contractor shall provide those records to the Attorney General upon request. \\Cobra\Shared\Contracts\Direct Payment\City of Azusa Exh C.doc C4 425 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit D (Agreement) ADDITIONAL TERMS AND CONDITIONS 1. Cancellation Either party may terminate this Agreement by giving thirty (30) day's prior written notice to the other party. 2. Subcontracts No subcontracts shall be permitted under this Agreement. 3. Complete Agreement This Agreement, which includes any supplemental documents attached hereto, sets forth the entire agreement between the Contractor and the Department, and supersedes all other oral or written provisions. No modification of any of the provisions shall be binding on the Contractor or the Department unless expressly agreed to in writing. 4. National Labor Relations Board Certification Contractor hereby certifies, under penalty of perjury, that no more than one (1) final unappealable finding of contempt of court, by a Federal Court, has been issued against Contractor within the immediately preceding two (2) year period because of Contractor's failure to comply with an order of a Federal Court which orders Contractor to comply with an order of the National Labor Relations Board. Drug -Free Workplace Requirements By signing this Agreement, Contractor hereby certifies under penalty of perjury under the laws of the State of California that Contractor will comply with the requirements of the Drug -Free Workplace Act of 1990 (Government Code Section 8350 et seq.) and will provide a drug-free workplace by taking the following actions: A. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations. B. Establish a Drug -Free Awareness Program to inform employees about: 1) The dangers of drug abuse in the workplace; 026 D1 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit D (Agreement) 2) The person's or organization's policy of maintaining a drug-free workplace; 3) Any available counseling, rehabilitation, and employee assistance programs; and C. Every employee who works on the proposed Agreement will: 1) Receive a copy of the company's drug-free workplace policy statement; and 2) Agree to abide by the terms of the company's statement as a condition of employment on the Agreement. Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and Contractor may be ineligible for award of any future State agreements if the Department determines that any of the following has occurred: (1) the Contractor has made false certification, or (2) violated the certification by failing to cavy out the requirements as noted above. (GC 8350 et seq.) 6. Americans with Disabilities Act Contractor assures the State that it complies with the Americans with Disabilities Act (ADA) of 1990, which prohibits discrimination on the basis of disability, as well as all applicable regulations and guidelines issued pursuant to the ADA. (42 U.S.C. 12101 el seq.) Records A. Contractor shall make available to the Department, or its representative, all appropriate books, documents, papers, and records for examination, copying or mechanical reproduction on or off its premises as the Department may require. B. Contractor shall preserve and make available the items listed above for a period of three (3) years from the date of the final disbursement under this Agreement. In the event any record must be maintained for a period longer than three (3) years,. the Department will send Contractor appropriate notification. D2 027 Direct Pay City of Azusa Agreement No. 03-1166 Exhibit D (Agreement) g, Right to Monitor Audit and Investigate The Federal Government, State Government, or duly authorized representative of the State Government, which includes, but is not limited to, the Bureau of State Audits, shall have the right to monitor and audit all parties to this Agreement and all subcontractors providing services under this Agreement through on-site inspections, audits, and other means deemed necessary for a period of three (3) years from the date of the final payments under this contract. \\Cobra\Shared\Contracts\Direct Payment\City of Azusa Exh D.doc D3 028 TO: THE HONORABLE CHAIR AND MEMBERS OF THE CITY COUNCIL FROM: RICK COLE, CITY MANAGER DATE: NOVEMBER 251", 2002 SUBJECT: ADOPTION OF PROPOSED BALLOT MEASURE RECOMMENDATION Because of court decisions indirectly affecting the collection of the City's Utility Users Tax, staff recommended that the Council consider a ballot measure to be placed on the March ballot that would: ➢ Reduce the rate for residential electric, water and gas from 5% to 4% ➢ Increase the rate for commercial electric water and gas from 5% to 8% After a public hearing last week, Council directed staff to meet with representatives of the Azusa Chamber of Commerce and the Azusa Downtown Business Association to address their concerns with the proposal. As a result of that meeting, staff recommends that we drop the aspect of the proposal that would extend the tax to telephones and wireless devices and proceed with the rest of the measure as originally recommended. It is also clear that there is strong support from business leaders to actively participate in the community "Tax Review Task Force" the Council will be appointing to work with the Council and staff on a broader tax reform plan to be put before voters in November 2003. Staff recommends that this task force be organized to begin work in January. BACKGROUND Business leaders recognize the need to support city services. But they have expressed a clear desire to participate in tax decisions that affect them. While acknowledging the low costs of utility services from Azusa Light and Water (electric rates average 30% lower than Edison and the second lowest water rates in the San Gabriel Valley) they are concerned about increased costs in the current uncertain business climate. Particularly with increa�sedd reliance on phones and wireless devices in the business world, they argued that staff appears to have underestimated the revenue from extending the tax to those areas (and thus underestimated the burden on business.) While business leaders would prefer to defer any tax increase until after the proposed task force completes its work, they understand the budget realities facing the city. Leaders from both organizations were prepared to take a neutral stance on the proposed electric, water and gas rates if the proposed tax on telephones and wireless devices were dropped. They emphasized a commitment to participate in the "Tax Review Task Force" to hammer out a long-term fiscal plan for financing needed city services that would examine the entire range of revenue and expenditure alternatives. They were particularly concerned that the burden of additional revenue be borne widely and not just by business. The fiscal impact of the revised recommendation reduces new revenue from $1 million to $465,000. While this falls short of closing the city's anticipated $1 million gap for the fiscal year beginning July 1, it does significantly reduce the gap and protects the existing $1.7 million in utility tax revenue from legal challenge. Since the passage of Proposition 13 nearly 25 years ago, California cities have scrambled to adjust to a series of voter initiatives, legislative changes and court decisions that have completely reshaped how communities pay for basic services like police, fire, library and parks. Where once property taxes were the backbone of support for local services, today our city receives only 15 cents out of the property tax dollar. The service demand has not gone away, but the funding has had to come from other sources. Without any statewide plan or principles to guide this evolution, the result is that "local finance sources are unstable, uncertain, often inadequate, and subject to unpredictable revisions by the Legislature" within a legal framework that "is commonly viewed as arcane, incomprehensible, and sometimes biased," according to the State's own Commission on Local Governance for the 21" Century. The impact on Azusa is particularly acute. The infamous "ERAF" decision by the Governor and Legislature to balance the 1992 budget by diverting local property tax revenue from cities to school districts has cost our city over $7 million dollars so far, at a rate that has grown to nearly $1 million a year. Four years ago, Governor Gray Davis declared that the State "stole" the money, saying "we've got to get it back. I promise to do just that. It will be over a period of time, but we will give the money back because it wasn't ours to start with." Yet despite record State surpluses, the funding was not even partially restored and the "emergency" diversion continues to this day. The passage of Proposition 218 by California voters forced the City to put the Fire Assessment District to a new vote, not of residents, -but of property owners according to the dollar volume of their holdings. Despite majority approval of city residents, the Funding for fire service in the city was repealed by the votes of business and apartment landlords. The city's budget has had to fund an annual burden of $2.5 million a year (which rise next year due to expiration of $300,000 in annual credits as a result of a previous overcharge in the County's formula.) To offset these annual losses of $3.5 million a year, Azusa has not been idle. But working within the "arcane, incomprehensible, and sometimes biased" legal framework controlling city finances has been difficult: ➢- Voters turned down three out of five revenue measures to partially replace the ' Fire Assessment fee. Of the two that passed, one (quarry tax) led to lengthy and expensive litigation before a settlement agreement. The other (swap meet admission and vendor tax) produced $300,000 a year, but that ended last year when the long-standing requirement for also showing movies at the Drive-in led the operator to shift to Citrus College. ➢ At a time when cities have been driven to ruthless competition for sales tax generators, Azusa was forced to cut a deal with Costco to keep them from relocating to another community. The deal gives a rebate back to Costco of nearly half a million a year in sales tax revenue that would otherwise go to the City. Despite a similar deal with Bert's Motorcycle, they relocated two years ago to Covina to expand into a vacant big box. And Azusa lost $3 million in a tug of war with West Covina for Mission Chrysler. ➢ Voters approved a hike in business license taxes for apartments because of the gap between service costs and tax revenue from apartments. When landlords again raised rents, many told their tenants that the city was to blame, despite the increases running far in excess of the additional tax burden. In this adverse:6imate, Azusa has safeguarded city services and in the last three budget years, regained ground lost in the immediate aftermath of the ERAF shift and Fire Assessment loss. The Council has unfrozen vacancies and added staff in priority areas like Police, Code Enforcement and Human Relations. The Council has acquired or shifted funding to address long-standing problems of deferred maintenance and growth needs for city facilities, including expanding the Police headquarters, repairing streets and improving parks. Nonetheless, as I have warned repeatedly during the past three years, we must either secure significant additional recurring revenue or make significant cuts in tTie services offered to residents and businesses. This year's budget (FY 2003) was balanced using one-time savings from the budget a year ago (FY 2001.) But good planning and good fortune cannot be counted on to continue indefinitely. The Council adopted this year's budget recognizing the need to secure an additional $1-2 million in recurring funding. But now we face an additional complication. Two State initiative measures (Propositions 62 and 218) have produced a series of court decisions interpreting them that has dramatically changed the authority for local taxes. After long assuming that Azusa's Utility Users Tax was valid, because of indirectly related court decisions, it now appears the tax would be subject to legal challenge without reauthorization from voters. With $1.7 million at risk, the City cannot wait for a test case and the costs and uncertainty such a lawsuit would entail. As a result, the City Attorney, City Manager and Azusa Light & Water Director strongly recommend the City Council place a measure before voters at the next election to validate the existing tax. As in any crisis, this offers both "danger" and "opportunity." The necessity of a new vote on the tax offers the opportunity to restructure the tax for greater fairness and greater revenue to support vital city services. In terms of fairness, the recommendation offers the opportunity to: ➢ Reduce the burden on city residents, particularly homeowners, of a tax that is tied to utility consumption rather than residents' ability to pay ➢ Allocate a larger share of the cost of city services to the largely industrial and warehouse sector of business that does not generate sales tax revenue to the city and enjoys the second lowest cost of doing business out of the 88 cities in Los Angeles County ➢ Close the loophole on taxing of commercial phone services which are taxed by virtually every other city besides Azusa that has a Utility Users Tax Clearly, at a time of economic uncertainty, the resident tax relief will strengthen the City's commitment to home ownership. By the same token, an increased rate for business must be carefully weighed so as not to adversely affect the climate for business in Azusa. But industrial and warehouse businesses currently enjoy the lowest electric rates in the San Gabriel Valley, averaging 20-40% less than Edison rates, depending on the time of year. Throughout the County, the only city with comparable utility rates and lower business taxes is the industrial city of Vernon. That city, however, recently imposed a significant business license increase on all warehousing businesses in the city. Also our water rates are the second lowest in the San Gabriel Valley. Moreover, these added costs must be weighed on the other side against the impact on businesses of cutting services without additional revenue. The projected $465,000 annual net revenue does not provide funding for new programs — it simply reduces the revenue shortfall that this year is being filled by previous savings. Without this funding, services must be reduced. The only other alternative (short-term belt tightening measures like hiring freezes, equipment purchase deferral, postponing capital reinvestment) has been tried and after many years left the organization's ability to provide quality services severely threatened. To start that cycle again would squander not only the progress we have made, but the progress the Council has worked so hard to bring: > 500 new homes being built, raising overall property values and creating a stronger base for attracting first-tier retailers > Building a new library for the future > Filling nearly 500,000 square feet of new light industrial "Flex" space > Fixing all of our streets over the next decade, with an emphasis on raising from 9 to 80% of our streets to excellent condition in the next five years > Rebuilding our aging sewer system > Supporting neighborhood revitalization, one neighborhood at a time > Upgrading and expanding our neglected parks and restoring our degraded riverfront > Confronting a disturbing pattern of gang violence and hate crimes with both effective law enforcement and prevention efforts Beyond the necessity of resolving the status of the Utility Users Tax is the responsibility to openly and fairly look at the City's current and potential revenue, taking into consideration the burden on both residents and business. Azusa has made significant progress by involving residents and business people in creating a new General Plan vision for the community as well as participating in shaping a wide range of development and other issues. A fresh look at the current tax structure with a commitment to tax reform can lay the foundation for long-term fiscal growth and a continued healthy business climate. The current Business License Tax, for example, falls more heavily on small businesses than large ones. Addressing this inequity may offset the impact of the increase in the Utility Users Tax. Because this would involve lengthy and detailed public participation, it is not feasible to make these choices in time for the March election. Thus it makes sense to plan a year-long effort that would involve the community in a comprehensive look at the City's finances. Such a "Tax Review Task Force" will thoroughly examine alternatives in light of: ➢ The Council's goal of adding additional Police officers and support staff for a growing population and the threat of gang violence and hate crimes. > The community's goal of building a new Library, contingent on State matching funds, which will require additional staff for the expanded collection and programs. > The potential for further diversion of local funds due to the State fiscal crisis. > The need to look at service or cost reductions from our existing budget to offset the need for additional tax revenue. Attached is a schedule for public consideration of the recommendation for placement on the March ballot. A sample of ballot language for such a measure is attached. The staff also looks to Council direction on discussion' of the recommendation with the residents and businesses affected prior to a final" Council decision, including letters, meetings and surveys. FISCAL IMPACT The recommendation is estimated to generate net additional revenue to the City's General Fund of $465,000 annually to reduce the anticipated $1 million shortfall in next year's operating budget. RESOLUTION NO. A RESOLUTIOWOF THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, ORDERING THE SUBMISSION OF A MEASURE TO THE QUALIFIED ELECTORS OF THE CITY TO AFFIRM AND AMEND THE UTILITY USER TAX WITHIN THE CITY OF AZUSA ON MARCH 04, 2003 WHEREAS, pursuant to California Elections Code, Section 9222, the City Council may submit to the qualified electors of the City a proposition, without a petition therefor, by ordinance or resolution; and WHEREAS, the City intends to hold an election on March 4, 2003; and WHEREAS, the City Council desires to submit to the qualified electors of the City a resolution asking whether to amend the Azusa Municipal Code by adopting an ordinance to affirm and amend the utility user tax within the City of Azusa. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, DOES FIND AND DECLARE THAT: SECTION 1. Question Submitted to Voters. The City Council, pursuant to Elections Code Section 9222, hereby orders that the following question be submitted to the qualified electors of the City of Azusa at the election to be held on March 4, 2003: Utility User Tax "Measure _: Shall the voters of the City of Azusa adopt Ordinance No. affirming the Utility User Tax and reducing the existing residential tax from 5% to 4% and increasing the existing commercial tax from 5% to 8%?" SECTION 2. Impartial Analysis by City Attorney. The City Clerk is hereby directed to transmit a copy of the measure set forth in Section 1 above to the City Attorney, who shall prepare an impartial analysis of the measure in accordance with Section 9280 of the Elections Code. SECTION 3. Effective Date. This Resolution shall become effective upon its adoption. ORANGDSRQ2833 —i— PASSED, APPROVED AND ADOPTED this II day of November 2002. Cristina Cruz -Madrid Mayor ATTEST: Vera Mendoza City Clerk ORANGC�SRCL933 WordPerfect Document Compare Summary Original document:::ODMA\PCDOCS\RV PUB\641905\1 Revised document: ::ODMA\PCDOCS\RV_PUB\642383\1 Deletions are shown with the following attributes and color: Strikeeut, Blue RGB(0,0,255). Deleted text is shown as full text. Insertions are shown with the following attributes and color: Redline, (No color code). The document was marked with 62 Deletions, 75 Insertions, 0 Moves. ORANGETMK\2952 ORDINANCE NO. AN ORDINANCE OF THE CITY OF AZUSA, CALIFORNIA, RATIFYING, APPROVING, VALIDATING AND CONTINUING THE CITY'S UTILITY USERS' TAX WITH AMENDMENTS WHEREAS, Azusa residents have repeatedly indicated their desire for a well maintained community and availability of quality services to all citizens regardless of socio-economic status; and WHEREAS, in 1992, in response to a decline in revenue and the community's demand for quality municipal services, the City investigated alternative revenue sources and taxation options; and WHEREAS, in accordance with its police powers and California Government Code Section 37100.5, the City Council adopted Ordinance No. 92-031 imposing a utility user's tax, which ordinance has been codified as Article VII of Chapter 70 of the Azusa Municipal Code (the "UUT"); and WHEREAS, the City Council lawfully adopted the UUT without voter approval based on elyin accordance with the ease e€court's ruling City of Woodlake v. Logan (1991) 230 Cal.App.3rd 1058; and WHEREAS, in September of 1995 the California Supreme Court ek,e m led the Weed4ake deedsion 'n its aeeisio, in the ease efcreated ambiguities in the assessment and collection Ofutility users taxes when it rendered its decision Santa Clara County Local Transportation Authority v. Carl Guardino (1995) 11 CalAth 220; and WHEREAS, the City Council has adopted Resolution No. which has placed on the ballot for the City's March 4, 2003 general election the question as to whether the voters shall approve of the City validating and continuing to collect the UUT, with amendments to reduce the residential tax and increase the commercial tax: and WHEREAS, the Azusa veters'approval ofthis Ord inanee shall be deeRie placement ofthis ordinance on the ballot and subsequent approval by the voters of Azusa is an attemp—t will satisfy the legal requirements concerning voter approval of taxes as set forth in Article 3.7 of Chapter 4 of Part 1 of Division 2 of Title 5 of the California Government Code (Proposition 62) and address any ambiguities created by the Guardino decision. NOW, THEREFORE, THE PEOPLE OF THE CITY OF AZUSA DO ORDAIN AS FOLLOWS: SECTION 1. TArlicle VI 1, Chapter 70 of the Azusa Municipal Code is hereby amended by ORANGB\BMK\2952 -2- deleting A f fiele VH o frr,,.pt mina deleting ,...�_�• VH in its entirety and reYlac; nom, eplaced with the following: "ARTICLE VII.: UTILITY USER'S TAX Sections: Sec. 70-261 Sec. 70-262_ Sec. 70-263_ Sec. 70-264 Sec. 70-265 Sec. 70-266 Sec. 70-267 Sec. 70-268 Sec. 70-269 Sec. 70-270_ Sec. 70-271 Sec. 70-272 Sec. 70-273 Sec. 70-274 Sec. 70-275 Sec. 70-276 Sec. 70-277 Sec. 70-278_ Sec. 70-279 Definitions Operative date Exemptions Electricity Cogenerated electricity Fuel Service users receiving direct purchase of fuel or electricity Water [Intentionally omitted] Reporting and remitting Interest and penalty Actions to collect Attorneys' fees Duty to collect; procedures Additional power and duties of tax administrator Assessment; Records Refunds administrative remedy Termination or suspension Sec. 70-261. Definitions. The following words, terms and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning. Cogenerator means any corporation, including an electrical corporation, or person employing cogeneration technology for producing power from other than a conventional power source for the generation of electricity. Electrical corporation, gas corporation, water corporation and cable television corporation mean the same as defined in the California Public Utilities Code sections 234, 218, 222, 241 and 215-5, respectively, as such sections existed on July 1, 1992, except the term "electrical corporation" includes any franchised agency or cogenerator, and the terms "electrical corporation," "gas corporation" and "water corporation" include any municipality, public agency, broker/marketer or ORANGFVIMK\2952 -3- person engaged in the selling or supplying of electrical power or gas or water to a service user. Fuel means natural or manufactured gas or any alternate hydrocarbon fuel which may be substituted therefor. Nonutility supplier means: (1) A service supplier, other than an electrical corporation serving with the city, which generates electrical energy in capacities of at least 50 kilowatts for its own use or for sale to others; or (2) A gas supplier, other than a gas corporation, that sells or supplies gas to users within the city. Person means any residential, commercial or industrial utility user. Service supplier means any entity which receives taxes paid and remits taxes as imposed by this article. Service user means a person required to pay a tax imposed by this article. Tax administrator means the finance director of the city. Sec. 70-262. Operative date. This article shall become effective ten days after the certification of the election results. The tax imposed under this article shall apply to bills rendered on or after that date. Sec. 70-263. Exemptions. (a) Nothing in this article shall be construed as imposing a tax upon any person when imposition of such tax upon that person would be in violation of the Constitution of the United States or the constitution of the state or upon the city or any of its departments, agencies, boards or commissions or upon any school district or upon any other person, when imposition of such tax upon that person would be in violation of the Constitution of the United States or the constitution of the state. The tax administrator shall prepare a list of the persons exempt from this article by virtue of this section and furnish a copy thereof to each service supplier. (b) There shall also be exempted the following: (1) Individuals over the age of 61. (2) Individuals certified as handicapped by the city's light and water department. (3) Individuals certified as low-income using standards developed by the city's light and water department. (4) Organizations classified as exempt from taxation under chapter 501 of the Internal Revenue Code. (c) The tax administrator shall develop regulations for deterinining eligibility for the OR NGE�MK%2952 -4- exemptions provided for in this section and shall be charged with the responsibility for developing forms and procedures and processing applications for exemptions. (d) The light and water department shall determine the eligibility of any person who asserts a right to exemption from the tax imposed by this article. The light and water department shall provide the tax administrator with the name of any person it determines is exempt from the tax imposed by this article, together with the address and account number to which service is supplied to any such exempt person. The tax administrator shall certify the information and shall provide it to the service provider. The tax administrator shall also notify the service supplier of the termination of any person's right to exemption under this article or the change of any address to which service is supplied to any exempt person. Sec. 70-264. Electricity. (a) There is imposed a tax upon every person in the city using electrical energy in the city. The tax imposed by this section shall be at the rate of f per-eent-followingrates: For residential electrical utility users the rate shall be four Dercent (4%)of the charges made for such energyelectricity and shall be paid by the person paying for such energy -electricity. For commercial and industrial electrical utility users the rate shall be eight percent (3%) of the charges made for such electricity and shall be paid by the person payin for such electricity. The charges referred to in this section shall include charges made for: (1) Metered energy; (2) Transmission and distribution charges; and (3) Demand charges, service charges, customer charges, minimum charges, annual and monthly charges, fuel cost adjustments and any other charge authorized by the state public utilities commission or the federal energy regulatory commission. (b) As used in this section, the term "using electrical energy" shall not be construed to mean the storage of such energy by a person in a battery owned or possessed by him for use in an automobile or other machinery or device apart from the premises upon which the energy was received; provided, however, the term shall include the receiving of such energy for the purpose of using it in the charging of batteries. The term shall not include electricity used and consumed by an electric utility supplier in the conduct of its business as an electric public utility nor shall the term include the mere receiving of such energy by an electric public utility or government agency at a point within the city for resale or the use of such energy in the production or distribution of water by a public utility or a governmental agency nor shall the base on which the tax imposed in this section is computed include reconnect charges, late payment charges, returned check charges, penalties, ORANGETMK2952 -5- broken meter charges, etc. (c) The tax imposed by this section shall be collected from the service user by the person providing such energy. The amount of the tax collected in one month shall be remitted to the tax administrator on or before the last day of the following month. Sec. 70-265. Cogenerated electricity. (a) There is imposed a tax on every person in the city using Cogenerated electrical energy in the city. The tax imposed by this section shall be at the -a'e of five peree ntfollowing rates: For residential Cogenerated electrical utility users, the rate shall be four percent (4%)of the value of the Cogenerated electrical energy consumed in the city. The cogenerator shall install and maintain an appropriate utility type metering system which will enable compliance with this section. For commercial and industrial Cogenerated electrical utility users, the rate shall be eight percent (S%) of the value of the Cogenerated electrical energy consumed -energy in the city.- The cogenerator shall install and maintain an appropriate utility type metering system which will enable compliance with this section. (b) The tax shall be collected and paid by the cogenerator at the rates indicated in subsection (a) if the cogenerator consumes the energy. If the cogenerator sells the energy, the tax shall be paid by the person to whom the energy is sold and collected by the cogenerator at the rates indicated in subsection (a). (c) The amount of the tax collected in one month shall be remitted to the tax administrator on or before the last day of the following month. Sec. 70-266. Fuel. (a) There is imposed a tax upon every person in the city, other than a gas corporation or electrical corporation, using, in the city, natural gas and other hydrocarbon fuel which is transported through the gas pipeline distribution system or by mobile transport. The tax imposed by this section shall be at the rate of five pereentfollowing rates: For residential users the rate shall be four percent (4%) of the amount that will be paid by the person using the fuel. For commercial and industrial utility users. the rate shall be eight percent (8°/)) ofthe amount that will be paid by the person using the fuel. The tax applicable to fuel provided by nonutility suppliers shall be determined by applying the tax rate to the actual charges the service user incurred. The term "charges," as used in this section, shall OBANGE\BMK\2952 -6- include the following: (1) That billed for fuel which is delivered through a gas pipeline distribution system or mobile transport; (2) Fuel transportation charges; and (3) Demand charges, service charges, customer charges, minimum charges, annual and monthly charges, fuel cost adjustments and any other charge authorized by the state public utilities commission or the federal energy regulatory commission. (b) The following shall be excluded from the base on which the tax imposed in this section is computed: (1) Charges made for gas which is to be resold and delivered through mains or pipes; (2) Charges made for gas sold for use in production or distribution of water by a public utility or governmental agency; (3) Charges made by a gas public utility for gas used and consumed in the conduct of the business of gas public utilities; (4) Charges made for gas used by a cogenerator or fuel cell or in the propulsion of a motor vehicle, as that phrase is defined in the state Vehicle Code, utilizing natural gas; and (5) Reconnect charges, late payment charges, returned check charges, penalties, broken meter charges, etc. (c) The tax imposed by this section shall be collected from the service user by the person selling the gas. The person selling the gas shall, on or before the 20th of each calendar month, make a return to the tax administrator stating the amount of taxes billed during the preceding calendar month. At the time such returns are filed, the person selling the gas shall remit tax payments to the tax administrator in accordance with schedules established or approved by the tax administrator. Sec. 70-267. Service users receiving direct purchase of fuel or electricity (a) Notwithstanding any other section of this article, a service user receiving fuel or electricity directly from a nonutility supplier not under the jurisdiction of this article or otherwise not having the full tax due on the use of fuel or electricity in the city (unincorporated/incorporated) directly billed and collected by the service supplier shall report the fact to the tax administrator within 30 days of such use and shall directly remit to the city the amount of tax due. (b) The tax administrator may require the service user to provide, subject to audit, filed tax returns or other satisfactory evidence documenting the quantity of gas or electricity used and the actual price thereof. Sec. 70-268. Water. ORANGEUiMK\2952 (a) There is imposed a tax upon every person in the city using water which is delivered through mains or pipes. The tax imposed by this section shall be at the rate ^°�entfollowing rates: For residential water utility users the rate shall be four percent (4%) of the charges made for such water. For commercial and industrial water utility users the rate shall be eight percent (8%) of the charges made for such water. (b) The term 'charges," as used in this section, shall include charges made for the following: (1) Metered water; (2) Transmission and distribution charges; and (3) Demand charges, service charges, customer charges, minimum charges, annual and monthly charges, water cost adjustments, and any other charge authorized by the state public utilities commission or the federal energy regulatory commission. (c) There shall be excluded from the base on which the tax imposed in this section is computed charges made for water which is to be resold and delivered through mains or pipes; charges made by a municipal water department, public utility or a county or municipal water district for water used and consumed by such department, utility or district; and reconnect charges, late payment charges, returned check charges, penalties, broken meter charges, etc. (d) The tax imposed by this section shall be collected from the service user by the person selling the water. The amount collected in one month shall be remitted to the tax administrator on or before the last day of the following month. See. 70-269. [Intentionally omitted] Sec. 70-270. Reporting and remitting. Each service supplier shall, on or before the last day of each month, make a return to the tax administrator on forms provided by him, stating the amount of taxes billed by the service supplier during the preceding month, except as provided in section 70- 266(c). At the time the return is filed, the full amount of the tax collected shall be remitted to the tax administrator. The tax administrator is authorized to require such further information as he deemed necessary to determine if the tax imposed is being levied and collected in accordance with this article. See. 70-271. Interest and penalty. ORANGEIBMKk2952 -8- (a) Under this article, taxes collected from a service user which are not remitted to the tax administrator on or before the due dates provided in this article are delinquent. Should the due date occur on a weekend or legal holiday, the return may be postmarked the first regular working day following a Saturday/Sunday or legal holiday. (b) Penalties for delinquency in remittance of any tax collected or any deficiency determination pursuant to this article shall attach to and be paid by the person required to collect and remit at the rate of 15 percent per month (prorated for periods less than one month) of the total tax collected or imposed by this article. (c) The tax administrator is empowered to impose additional penalties for fraud or negligence in reporting or remitting at the rate of 15 percent per month (prorated for periods less than one month) of the amount of the tax collected or as recomputed by the tax administrator. (d) Every penalty imposed under this section shall become apart of the tax required to be remitted. Sec. 70-272. Actions to collect. Any tax required to be paid by a service user under this article shall be deemed a debt owed by the service user to the city. Any such tax received from a service user which has willfully been withheld from the tax administrator shall be deemed a debt owed to the city by the person required to collect and remit. Any person holding such money contrary to this article shall be liable to an action brought in the name of the city for the recovery of such amount. Sec. 70-273. Attorneys' fees. The city shall be entitled to recovery of its attorney fees in any action to enforce this article. Sec. 70-274. Duty to collect; procedures. The duty to collect and remit the taxes imposed by this article shall be performed as follows: (1) Notwithstanding section 70-266(c), the tax shall be collected insofar as practicable at the same time as and along with the charges made in accordance with the regular billing practices of the service supplier. Where the amount paid by a service user to a service supplier is less than the full amount of the utility charge and tax which has accrued for the billing period, such amount and any subsequent payments by a service user shall be applied to the utility charge first until such charge has been fully satisfied. Any remaining balance shall be applied to taxes due. If a service user has notified the service supplier of his refusal to pay the tax imposed on the utility charges, section 70- 274(c) will apply. (2) The duty to collect tax from a service user shall commence with the beginning of the first full regular billing period applicable to the service user where all charges normally included in such regular billing are subject to this article. Where a person receives more than one billing, one or more being for different periods than another, the duty to collect shall arise separately for each billing. ORANGE\BMK\2952 -9- See. 70-275. Additional power and duties of tax administrator. (a) The tax administrator shall have the power and duty and is directed to enforce each and all of the provisions of this article. (b) The tax administrator shall have the power to adopt rules and regulations not inconsistent with this article for the purpose of carrying out and enforcing the payment, collection and remittance of the taxes imposed in this article. A copy of such rules and regulations shall be on file in the tax administrator's office. (c) The tax administrator may make administrative agreements to vary the strict requirements of this article so that collection of any tax imposed in this article may be made in conformance with the billing procedures of a particular service supplier so long as the agreements result in collection of the tax in conformance with the general purpose and scope: of this article. A copy of each such agreement shall be on file in the tax administrator's office. See. 70-276. Assessment; administrative remedy. (a) Under this article, the tax administrator may make an assessment for taxes not remitted by a person required to remit. (b) Whenever the tax administrator determines that a service user has deliberately withheld the amount of the tax owed by him from the amounts remitted to a person required to collect the tax or that a service user has refused to pay the amount of tax to such person or whenever the tax administrator deems it in the best interest of the city, he may relieve such person of the obligation to collect taxes due under this article from certain service users for specified billing periods. (c) The service supplier shall provide the city with amounts refused and unpaid, along with the names and addresses of the service users neglecting to pay the tax imposed under this article. Whenever the service user has failed to pay the amount of tax for a period of two or more billing periods, the service supplier may be relieved of the obligation to collect taxes due. (d) The tax administrator shall notify the service user that he has assumed responsibility to collect the taxes due for the stated periods and demand payment of such taxes. The notice shall be served on the service user by handing it to him personally or by deposit of the notice in the United States mail, postage prepaid thereon, addressed to the service user at the address to which billing was made by the person required to collect the tax or, should the service user have changed his address, to his last known address. If a service user fails to remit the tax to the tax administrator within 15 days from the date of the service of the notice upon him, which shall be the date of mailing if service is not accomplished in person, a penalty of 25 percent of the amount of the tax set forth in the notice OMNGM, MK\2952 -10- shall be imposed, but not less than $5.00. The penalty shall become part of the tax required to be paid under this article. Sec. 70-277. Records. It shall be the duty of every person required to collect and remit to the city any tax imposed by this article to keep and preserve, for a period of three years, all records as may be necessary to determine the amount of such tax as he may have been liable for the collection of and remittance to the tax administrator, which records the tax administrator shall have the right to inspect at city hall at all reasonable times. Failure to provide the tax administrator with documents requested by the times specified by the tax administrator shall result in a penalty of $250.00 per day for each day after the date the documents were requested to be produced by the tax administrator that the documents are withheld. Sec. 70-278. Refunds. (a) Whenever the amount of any tax has been overpaid or paid more than once or has been erroneously or illegally collected or received by the tax administrator under this article, it may be refunded as provided in subsections (b) and (c) of this section, provided a claim in writing therefor, stating under penalty of perjury the specific grounds upon which the claim is based, is filed with the tax administrator within three years of the date of payment. The claim shall be on forms furnished by the tax administrator. (b) Notwithstanding subsection (a) of this section, a service supplier may claim a refund or take as credit against taxes collected and remitted the amount overpaid, paid more than once or erroneously or illegally collected or received when it is established that the service user from whom the tax has been collected did not owe the tax; provided, however, neither a refund nor a credit shall be allowed unless the amount of the tax so collected has either been refunded to the service user or credited to charges subsequently payable by the service user to the person required to collect and remit. A service supplier that has collected any amount of tax in excess of the amount of tax imposed by this article and actually due from a service user may refund such amount to the service user and claim credit for such overpayment against the amount of tax which is due upon any other monthly returns, provided such credit is claimed in a return dated no later than three years from the date of overpayment. (c) No refund shall be paid under this section, unless the claimant establishes his right thereto by written record showing entitlement thereto to the satisfaction of the tax administrator. (d) Notwithstanding other provisions of this section, whenever a service supplier, pursuant to an order of the state public utilities commission or a court of competent jurisdiction makes a refund to service users of charges for past utility services, the taxes paid pursuant to this article on the amount of such refunded charges shall also be refunded to service users, and the service supplier shall be entitled to claim a credit for such refunded taxes against the amount of tax which is due upon the next monthly return. If this article is repealed, the amounts of any refundable taxes will be borne by the city. ORANGOBMK@952 -11- (e) A service supplier may refund the taxes collected to the service user in accordance with this section or by the service supplier's customary practice. Sec. 70-279. Termination or suspension. The service supplier shall, upon notification, terminate or suspend any utility user's tax commencing with the first full billing period which occurs after the effective date of such action by the city council." SECTION 2. Severability. If any section, subsection, sentence, clause phrase or portion of this ordinance is for any reason deemed or held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portion of this ordinance. The voters of the City of Azusa hereby declare that they would have passed each section, subsection, subdivision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, clause or phrase would be declared invalid, unconstitutional or unenforceable. SECTION 3. Effective date. This ordinance shall be in full force and effect upon its approval by the voters of the City of Azusa. SECTION 4. Summary. A summary of this ordinance shall be published in the manner required by law. PASSED, APPROVED AND ADOPTED this day of 2003. Cristina Cruz -Madrid Mayor ATTEST: Vera Mendoza City Clerk ORANGMBM K\2952 -12- • �t..4MA AGENDA ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIESYJW DATE: NOVEMBER 25, 2002 SUBJECT: AUTHORITY TO ISSUE A REQUEST FOR PROPOSAL FOR LONG TERM FIRM POWER RECOMMENDATION It is recommended that the Utility Board/City Council authorize the staff to ,issue a Request for Proposal (RFP) to seek offers for long-term firm power. BACKGROUND As previously reported to the Board, the City's ability to provide reliable low-cost electricity is linked to the performance of Azusa's 30 megawatt share of San Juan Unit #3. Planned and unplanned outages of the unit have caused and will continue to cause adverse impacts to the City's ability to serve its customers cost effectively. To lessen the reliance on one unit contingent resource the staff has recommended exploring opportunities to assign or exchange part of the City's San Juan entitlement with other entities and replace It with an optimal amount of either a power resource (ownership) or a long-term power purchase contract. Staff has initiated discussions with the County of Los Alamos (IAC) of a San Juan assignment arrangement. Concurrently, staff believes it Is appropriate for the City to explore opportunities for cost effective power resources or long-term power purchase contracts to replace a portion of San Juan power -if the City is successful in the assignment arrangement. Therefore, the staff seeks the authority to issue an RFP to solicit proposals for off-peak and on -peak energy to meet portions of its power requirements in the event San Juan assignment arrangement is successful. The ultimate contracting of power under the RFP will be contingent upon (1) the successful San Juan assignment arrangement, and (2) the Utility Board approval. FISCAL IMPACT No fiscal impact as a result of the actions taken in this agenda item Is anticipated. Staff will present further recommendations to Utility Board as the RFP proposals are received and �4reviewed contingent on a successful partial San Juan assignment. /`/ ]/Z Prepared by: Bob Tang, Assistant Director Resource Management � City of Azusa Request for Proposals Energy Purchase -- RFP Number b0000C January m, 2003 Introduction: The City of Azusa (City) is soliciting proposals for off-peak and on -peak energy to meet portions of Its power requirements for its electric customers, The City is a municipal corporation ebsting under the laws of the State of California. The City owns and operates an electric public utility for its citizens, which provides electric service to virtually all of the electric customers within its City limits. The City is located in the greater metropolitan Los Angeles area, approAmately 24 miles east of downtown Los Angeles. Product: This request is for delivery of firm energy Delivery Point: The delivery points for this request are either Palo Verde or CAISO SP -15 The energy should be delivered within the following periods: ON -PEAK • Monday through Saturday: OFF-PEAK • Monday through Saturday: • Sundays and NERC Holidays: Term: The Term for this request is hour ending 0700 - hour ending 2200 PST. hour ending 0100 - hour ending 0600 PST; hour ending 2300 - hour ending 2400 PST. hour ending 0100 - hour ending 2400 PST. Proposal Quantifies: Proposal quantities are according to the table below: Peak Jan Feb Mar Apr May I Jun I Jul I AugSep Oct Nov Dec 20 20 20 20 20 20 20 20 20 20 20 20 Off -Peak Jan Feb Mar Apr May Jun Jul AugSep I Oct Nov Dec 10 10 10 10 10 10 10 10 10 1 10 10 1 10 Price: The City of Azusa will only accept fixed prices. Prices quoted must include final costs that would be e)pected to pay, Delivery Point: Supplier is responsible for delivering the energy to the California Independent System Operators (CAISO) congestion zones SPI 5 or Palo Verde. Supplier 054 City of Azusa Request for Proposals RFP Number xxxxx is also responsible for all transmission charges and transmission losses incurred to the specified delivery point. Scheduling and Dispatching: Energy deliveries if proposed in CAISO SP -15 zone will be prescheduled by the City as a Scheduling Coordinator to Scheduling Coordinator trade in accordance with the CAISO tariff or other applicable tariff. The Supplier shall meet all such tariff requirements including scheduling and dispatching requirements. Energy deliveries if proposed at Palo Verde will be prescheduled by the City in accordance with WECC scheduling protocols. Enabling Agreement: The energy purchase agreement shall be in accordance with and subject to the terms and conditions of the Western System Power Pool Agreement or such other generally accepted standard industry agreements as may be selected and modified by the City for purposes of this solicitation. Regulatory Requirements: Supplier must comply with all applicable federal and state laws. All permits, licenses, emissions allowances, environmental reviews, and other environmental requirements are the responsibility of the Supplier for the entire term of each proposal. Credit: Proposal Submittal: Proposals must be received no later than 4:00 p.m. PST on mom xx, 2003, and may be mailed or delivered in person to the following address: City of Azusa Light & Water Department 729 N, Azusa Ave. Azusa, CA 91702 Attention: Director of Utilffies Request for Proposal Energy Purchase -- RFP Number xxxxxxx The Citys contact person for this solicitation is Mr. Bob Tang, who can be reached at the above address or as follows: Phone: (626) 812-5214 Fax: (626) 334-3163 Email: btang@ci.azusa.ca,us. Please direct questions concerning the interpretation of this RFP to Mr. Bob Tang in writing by mall, facsimile, or email by xxxx xx, 2003. Proposal Evaluation: The City will evaluate the proposals based on the supplied information submitted pursuant to this RFP and will develop a short list of proposals from which the City will select the most competitive proposals for direct negotiations. The City reserves the right to evaluate and select proposals in a manner that ultimately produces the most competitive responses from which to begln negotiations. The City will select proposals, if any, that will provide the most value to Its utility customers. 055 2. City of Azusa Request for Proposals RFP Number xxxxx Validity of Price and Quantity. Suppliers price and quantity will be held until 4:00 p.m. PST, k0000a m, 2003, Conditions: The City reserves the right to modify or cancel, in part or entirety, this RFP for any reason. The City is not responsible for any preparation costs incurred by the Supplier. This RFP shall not be construed as an offer, and the City is not bound to purchase energy from any Supplier pursuant to this RFP. No rights shall be vested in any Supplier, individual or entily by virtue of its preparation to participate in, or its participation in, such process. No binding commitment shall arise on the part of the City to any Supplier under this RFP until and unless the parties sign documents of agreement that become effective in accordance with their terms. The City reserves the right to obtain additional information from Supplier including, but not limited to, affiliated entities and joint ventures, Suppliers financial strength, litigation and penalties. The City will select at its sole discretion the winning Supplier(s), If any. The City reserves the right to reject any proposals and any portion of a specific proposal for any reason, as well as the right to waive any informality or Irregularity in any proposal. The City assumes no obligation to provide a reason for rejection of a Suppliers proposal. Mt: MI. V§#1 INFORMATIONAL ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 SUBJECT: FOLLOW-UP ON CUSTOMER CABRERA BILLING COMPLAINT RECOMMENDATION None. BACKGROUND This is a follow-up to the issue raised at the October 2002 Board meeting at Public Participation by customers Mr. and Mrs. Cabrera. On October 10, 2002 Mrs. Cabrera, 505 N. Sunset Avenue, inquired about her higher than normal October utility bill of $422.39, particularly the electric portion of $294.24. She stated this happened around the same time last year. After our initial conversation we began Investigating the situation to find any error on our part. We exchanged Mrs. Cabrera's electric meter with an Automatic Meter Read meter and tested the old meter. It was 99.39% accurate. Normally, meters registering more than 2% inaccurate are replaced. Because of the dog in the Cabrera backyard our meter readers must read the meter from outside the fence with a scope. This may have resulted in an inaccurate read of $65.73 for electricity on the August 2002 bill. This may have also occurred for the September read, which was $140.91 for electricity. When there is a lower than normal read one month the following month a "catch up" read occurs that brings the two months current. In this case, if the second month was also read Incorrectly and made it appear normal ($140.91), the third month was the catch up read for all three months ($294.24). From our preliminary Investigation, the meter was accurate, the low and high consumptions were caused by reading errors. On October 28, 2002 Mr. and Mrs. Cabrera spoke at Public Participation at the Utility Board meeting. The Board authorized the Director of Utilities to adjust the Cabrera's October electric portion of their bill to an average of the last 24 months. Attached is a worksheet showing the changes. 459 On October 29, 2002, Mrs. Cabrera came to the Azusa Light & Water office and made a partial payment. She agreed that the balance could be added to her next utility bill. She said she was satisfied with the outcome. FISCAL IMPACT The amount of adjustment to customer's account was $174.99. Prepared by: Karen Vanca, Assistant Director Customer Care & Solutions ATTACHMENT: NIHI Worksheet 060 AZUSA LIGHT & WATER Armando Cabrera Account #045-5750-037 24 Month Average Adjustment Adj. Oct. 2002 11/12/02 ed 061 October 2002 Bill Ad*. Amount Bill Energy 2,668 kwh (1,330) kwh 1,338 kwh Electric Charges $294.24 $(149.77) $144.47 CA State Tax .53 ( .26) .27 Public Benefit 7.02 ( 3.50) 3.52 Fuel Cost Adj 26.68 (13.30) 13.38 Electric User Tax 16.05 ( 8.16) 7.89 Water Charges 49.17 49.17 Water User Tax 2.57 2.57 Barrel Trash 15.26 15.26 Trash Admin Fee .68 •68 Franchise Fee 1.69 1.69 RWCAF 2.29. 2.29 Sewer Charge 5.69 5.69 Community Maint. .52 52 $422.39 ($174.99) $247.40 11/12/02 ed 061 ,100'14, INFORMATIONAL ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD AND AZUSA CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES DATE: NOVEMBER 25, 2002 SUBJECT: UPDATE ON BUSINESS HOURS RECOMMENDATION None. BACKGROUND At the October 2002 Board meeting an issue was presented regarding the challenges of business office hours being the same as employee work hours. Staff recommended changing business hours from 7:00 a.m. - 5:30 p.m. to 7:15 a.m. - 5:15 p.m. This recommendation was rejected by the Board with concerns that the change would negatively affect our level of service. Staff was directed to go back and work out other solutions. Depending on the job duty, some employees (back office billing, payment processing, and meter reading) are able to actually start at 7:00 and leave at 5:30. Others, like cashiers, phone center, and field representatives, need to be in the office early and stay late, causing an unfair work environment. Customer Service Representatives (CSRs) agreed this unfairness would be rectified if one employee was no longer required to come in early to get office ready for business and allowed to leave early to compensate. Instead, the supervisor and lead will get the office ready for business. Further, Customer Service Representatives agreed to try to be in the office five minutes early in the morning. This is sometimes difficult for the four employees riding the Metrolink train since it has delays and the bus from the Metrolink station has other stops to make. Azusa Light & Water will pay overtime to any CSRs detained longer than seven minutes at the end of the day with customers. Staff meetings will continue to be held in two sessions and we will continue to try to mitigate any communication differences between the two meetings. FISCAL IMPACT $3,225.00 - $4,630.00 per year in overtime depending on the frequency of the overtime. Prepared by: Karen Vanca, Assistant Director Customer Care & Solutions 0 6 SIN N civ fi AZUSA LIGHT A WATER 11 Azusa Utility Board Meeting November 25, 2002 HT w � Power Resources Division Monthly Report • Status of Projects • Power Consumption Comparison • Wholesale Market Trend • Power Resource Budget Update Status of Projects • Participating Transmission Owner Application — Transmission Control Agreement — Negotiations Completed — Scheduling Integration With CAISO — Negotiations Ongoing • Edison's Transmission Service Agreements - Negotiations Ongoing • San Juan Project — Discussions with Los Alamos County — Ongoing — Issuance of Request for Proposals for Long Term Power — In Preparation — Short Term Firming Arrangements With Coral Power - Finalized ..... CITY OF AZUSA ENERGY CONSUMPTION COMPARISON . } PERCENT MONTH FY01-02 FY02-03 I CHANGE JUL 21,524 23 581 9.56% AUG 22,908 22 502 1.77% SEP 21,242 23047 1 OCT 20,485 20,290: _. -_ -0.95%! NOV DEC JAN ......... . FEB _ ....- _ MAR .-. APR i, MAY I_ JUN TOTAL_.,j ... .... 86158 89420 ! 3.79%. i. ;........- ENERGY CONSUMPTION IN MWH -. .. -- CITY OF AZUSA PEAK DEMAND COMPARISON PERCENT MONTH FY01-02 FY02-03 CHANGE JUL 46 .6 52.0 .i 11.59% AUG.. 46.9. 48.4 SEP � 47.4 54.1 14.18% OCT..... j. 50.4:,... _....... 44.0 -12.65% NOV DEC... _ JAN... �.. FEB MAR APR MAY JUN. PEAK DEMAND IN MW j AVERAGE MONTH ON PEAK PRICE I JAN 02 FEB 02 $23.00 MAR 02 $34.66 - APR I - - 0 . 2 - $29.001 MAY 02 JUN 02 JUL 02 AUG 02 SEP 02 OCT 02 NOV 02 DEC 02 JAN 03 FEB 03 ALL PRICES IN $fMWH I I,-,,- -.- - I -- - ----------- 11 - - - ---4 73 .52 AVERAGE OFF PEAK PRICE Power Resource Cost Accounting FY'02-'03 ,-� Azusa Utility Board Meeting "Status of Projects" November 25, 2002 Q N V W.Status of Projects . Azusa's Participating Transmission Owner Application . San Juan Assignment to Los Alamos County, New Mexico 0 0 Azusa I s PTO Application Agreements — All pertinent agreements executed and filed with FERC Scheduling Integration with the CAISO — facing some delays Anticipated Outcome: The City's PTO participation is likely to be delayed due to scheduling integration issues. In the worst case, the City may face higher transmission costs in the range of $20,000/month for a few months commencing January 2003. 0 ti San Juan Assignment to Los ,,Alamos County, New Mexico • The City and Los Alamos County executed the 60 -day Option Agreement effective Nov. 1, 2002 to negotiate an assignment arrangement. • Staff is coordinating with SCPPA and LAC to identify relevant issues. One major issue has surfaced which may render the assignment infeasible. • Staff is seeking authority to issue an RFP for long term power to potentially replace San Juan power. Anticipated Outcome: In view of some tax issues associated with San Juan bonds and the deteriorating wholesale market environment, it is less likely for the City to be successful in assigning San Juan output to LAC. In the worst case, the City will have to continue to manage San Juan related exposures for an extended period of time.