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HomeMy WebLinkAboutK- 4 adopt the Attached Resolution authorizing water rate adjustment of 5.1% The Cityfo Azusa AZUSA LIGHT & WATER At N ' a For Quality of Life TO: HONORABLE MAYOR AND CITY COUNCIL FROM: JOSEPH F. HSU, DIRECTOR OF UTILITIES R, VIA: RICK COLE, CITY MANAGER DATE: JUNE 1, 1999 RE: WATER RATE ADJUSTMENT Recommendation: Adopt the attached resolution authorizing water rate adjustment of 5.1% for all bills rendered after July 1, 1999. Background: Water utility is one of the most capital intensive operation in the industry. Installation of water lines requires not just expensive material, but labor intensive excavation, back-filling and re-paving. Water lines are also subject to deterioration and damage from earth movements. Azusa Water Utility is constantly replacing and repair old and leaky water mains. In fiscal year 1997-1998, over five million dollars were invested in the capital projects, mostly in the transmission and distribution infrastructures. In accordance with the regulatory rate making practices, Azusa water rates have been adjusted periodically to allow for recovery of capital investments. The latest rate adjustment for Azusa water customers (excluding the former Azusa Valley Water Company customers) was in 1992. The proposed 5.1%increase represents the amortized capital investment as well as the cost of the capital. Additionally, the Bond Covenant of the 1993 Revenue Bond for the acquisition of Azusa Valley Water Company and the refunding of the City of Azusa 1987 Water Revenue Bond requires that the City will prescribe, revise and collect such charges for the services and facilities which, after allowances for contingencies and error in the estimates, shall produce Gross Revenues sufficient in each Fiscal Year to provide Net Revenues equal to at least 1.25 times the Operating Payments coming due and payable during such Fiscal Year. The recommended adjustment is necessary to provide the minimum coverage for the bond payments. Attached for your information and reference are: existing and proposed rate schedules, and comparison of water costs for an average residential customer of the public and private water utilities in the San Gabriel Valley. Fiscal Impacts: The recommended adjustment of 5.1% will increase the water retail revenue by $595,000 annually. General Fund will realize an approximate increase of$89,250 annually which includes franchise tax, in-lieu tax, and Utility Users Tax.Attachments40wic 729 N. Azusa Avenue P.O. Box 9500 Azusa, California 91702 626/812-5208 (phone) 626/334-3163 (fax) utilities@azusa.ca.gov (e-mail) RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA AMENDING THE SCHEDULE OF WATER RATES AND CHARGES FOR THE AZUSA LIGHT AND WATER DEPARTMENT WHEREAS,pursuant to Section 78-36 and Section 78-37 of the Azusa Municipal Code, the rates and charges of the City of Azusa water utility are set by a Resolution passed by the Council WHEREAS,pursuant to Section 15079.1 of the guidelines for the implementation of the California Environmental Quality Act(CEQA)stipulates that the review provisions of CEQA do not apply to matters of government finance when the funds are for(1) meeting operating expenses;(2)purchasing or leasing supplies,equipment or materials;(3)meeting financial reserve needs and requirements;and(4)obtaining funds for capital projects necessary to maintain a service within existing service areas, and WHEREAS,in order to meet expenses,the City of Azusa has an urgent need to review the schedule of rates and charges for the City of Azusa's Water Utility,and WHEREAS,the proposed revisions by nature pertain to government finance in meeting operating expenses and obtaining funds for capital projects necessary to sustain and maintain water service within existing service areas, NOW THEREFORE,THE CITY COUNCIL OF THE CITY OF AZUSA DOES HEREBY RESOLVE AS FOLLOWS: Section 1. The City's schedule of rates and charges for its Water Utility are hereby amended to read as on Exhibit A which is attached to this Resolution and made a part of it,and Section 2. The review provisions of the California Environmental Quality Act do not apply to these amendments. Section 3. The amended rates and charges of the City of Azusa Water Utility shall take effect for all bills rendered on or after July 1,1999. Section 4. The City Clerk shall certify the adoption of this Resolution. PASSED,APPROVED AND ADOPTED THIS DAY OF ,1999. MAYOR I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the City Council of the City of Azusa at a regular meeting thereof,held on the_ day of ,by the following vote of the Council: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: CITY CLERK EXHIBIT "A" WATER RATE SCHEDULE The following schedule of rates is fixed and established as the rates to be collected by the City of Azusa Light &Water Department for supplying water to its customers within the certificated service territories of the City of Azusa. L METER SERVICE CHARGE The basic monthly meter service charge for water supplied to domestic, commercial, industrial, and municipal customers by the City of Azusa Light & Water Department shall be as follows: (Current) (Proposed) Service Size Monthly Charge Monthly Charge 5/8" - 3/4" $ 9.90 $ 10.40 1 " $ 17.22 $ 18.10 1 .5" $ 31 .63 $ 33.24 2" $ 50.55 $ 53.13 3" $ 96.36 $101.24 4" $155.65 $163.59 6" $274.23 $288.22 8" $396.71 $416.94 10" $519.31 $545.80 12" $649.00 $682.10 IL COMMODITY CHARGE The commodity charge is measured in increments of cubic feet. One cubic foot is 7.48 gallons of water. Each unit of water is billed as 100 cubic feet or 748 gallons. One hundred cubic feet is commonly referred to as CCF. Each meter size is allotted a quantity of water considered to be average for that size of service, units in excess of that allotment represents a higher use of the facilities of the water system, and therefore are billed according to the commodity rate schedule. (Current) (Proposed) Service Size Units Rate Rate 5/8" - 3/4" - 1" 0 - 17CCF $0.70 $0.74 > 17 CCF $1.11 $1 .17 1 .5" - 2" 0 - 50 CCF $0.70 $0.74 > 50 CCF $1 .11 $1 .17 3" - 4" 0 - 200 CCF $0.70 $0.74 > 200 CCF $1 .11 $1 .17 6" - 12" 0 - 600CCF $0.70 $0.74 > 600 CCF $1 .11 $1 .17 Golf Course $0.86 $0.91 III. MINIMUM CHARGE The minimum charge shall be the monthly meter service charge. N. FIRE SERVICE CHARGE Fire service connections are provided for fire protection only. If a fire service is used for any purpose other than for fire fighting, an minimum charge of fifty dollars ($50.00) (proposed$52.55, fifty-two dollars and fifty-five cents) shall be assessed in addition to the commodity charge for the actual amount of water used. If a fire service customer uses a fire service for other than emergency fire fighting repeatedly, the customer, upon notice of the water utility manager, may be disconnected from service for violation of the intended use of a fire service connection. The monthly charge for said fire service shall be seven dollars, $7.00, (proposed $7.36, seven dollars and thirty-six cents) per pipe diameter-inch. V. LIFELINE RATE Upon written application to the Light & Water Department, a water customer who meets the following standards is eligible for a two dollar ($2.00) discount from the basic monthly meter service charge. The Lifeline Rate may only be extended to City of Azusa residents. 1 . The customer must be either: a. 62 years of age or older; or b. Disabled within the definition of 20 C.F.R. 404.1505 and presently receiving disability Social Security benefits. 2. The customer must be a resident of a single-family dwelling unit with a water meter no larger than 3/4". 3. The customer shall have been a water customer at the service address for at least the previous twelve months prior to the application for the lifeline rate. 4. The customer's household income is at or below sixty percent (60%) of the Los Angeles County median income level. 5. Low-income customers who qualify for the lifeline rate shall re-apply every twelve months. VI. SPECIAL ZONE RATE The City of Azusa Light & Water Department has defined a special distribution zone rate to recover costs identified with the service associated that specifically designated service area. For water supplied to this defined area, the charges shall be double the above applicable rates. The area was specifically designated through an agreement between the City of Irwindale and the City of Azusa, wherein, the City of Irwindale requested the City of Azusa extend it's water utility service into the City of Irwindale in order to provide water service to those special customers in the City of Irwindale. This rate applies to water customers with accounts specially coded for that purpose. VII. MULTIPLE DWELLING UNIT CONNECTION RATE If one meter connection serves two or more separate dwelling units, stores, shops or other concerns doing business separate and apart from each other, whether in the same building or not, the first unit is charged the basic meter service charge, billed by the meter size rate; all additional units, stores, shops or other concerns are billed at the lowest meter service charge rate above. Water Utility Service Rates 1999 Agency Bi-Monthly Service Charge Unit Rate Total Bill City of Glendora* $10.50 $0.95 $42.80 City of Monterey Park $14.00 $0.87 $43.58 City of Azusa(existing) $19.80 $0.70 $43.60 City of Azusa (proposed) $20.80 $0.74 $45.96 City of Monrovia $1 1.00 $0.96 $43.64 City of Alhambra $9.50 $1.17 $49.28 Suburban (Cov./W. Cov.) $18.70 $0.94 $50.66 City of Covina $20.66 $0.92 $51 .94 City of La Verne* $12.60 $1 .17 $52.38 Cal Am Water (Duarte) $15.40 $1.17 $55.18 Rowland Water $16.35 $1 .35 $62.25 City of West Covina $23.84 $1 .33 $69.06 So Cal Water (Claremont) $46.70 $1.42 $94.84 Based upon 3/4"service, 34 units per billing period, bi-monthly billing. *Average of multi-zoned water rates.