HomeMy WebLinkAbout1991-01-22; City Council; Resolution 91-32-
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e RESOLUTION NO. 9 1-3 B
A RESOLUTION OF THE CITY OF CARLSBAD,
CALIFOIRNIA, ADOPTING THE 1990 SEWER RATE
STUDY AND SET A DATE FOR A NOTICED PUBLIC
HEARIN[G
WHEREAS, the sewer enterprise fund is totally dependent on sewer servic
charges to keep it fiscally sound;
WHEREAS, the City Council of the City of Carlsbad, authorized a sewer rat
study be conducted;
WHEREAS, the firm of James M. Montgomery, Consulting Engineerr
Incorporated, has completed the sewer rate study.
NOW, THEREFORE, BE IT RESOLVED by the City of Carlsbad, as follows:
1. That the sewer rate study prepared by James M. Montgomery
Consulting Engineers Incorporated, attached hereto as Exhibit 2 i
accepted; and,
That the City Council directs staff to prepare the ordinances require(
to implement the recommendations of the sewer rate study fo
consideration by the City Council at a noticed public hearing
PASSED, APPFLOVED AND ADOPTED at a regular meeting of the Carlsbac
City Council held on the 22 day of Jan., 1991, by the following vote, to wit:
2.
AYES: Council Members Lewis, Kulchin, Larson, Stanton and Nygaar
NOES: None
ABSENT: None
F-&iiiii, LE 'HA L. city Clerk
(SEAL)
KAREN R. KUNDTZ, Assistant City Clerk
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CHAPTER 1
EXECUTIVE SUMMARY
The objective of this report is to examine the financial position and value the assers
of the of the sewer enterprise of the City of Carlsbad (City). The review of the
financial position is to culminate in a set of sewer rates that is fair and equitable
and meets regulatory guidelines.
Rates were designed to be fair and equitable, easy to administer and update anti
conform to the policies of the City. Rates were determined on a cost of ser\.ice
basis so that customers pay charges in proportion to the services they use. Rares
that meet these objectives may gai:n easier acceptance by users.
The findings and recommendations of this study are summarized below.
FINDINGS
1. The City of Carlsbad provides sewer service to 70 percent of the City's
The remaini.ng population of the City is served by Leucadia
County Water District and Vailecitos Water District. The Utilities and
.Maintenance Department is responsible for sewer service in the City. The
wastewater generated is transported for treatment and disposal to rhe
Encina Water Pollution Control Facility (EWPCF) located in the City.
. population.
2. The City generates about 4.8 million gallons per day (xngd) wastewater at
the present time and owns treatment capacity of 6.2 mgd at EWPCF.
However, due to continuing growrh in the City, it is acquirins additional
treatment capacity of 3.1 5 mgd through an expansion of EWPCF currently
in progress. The City's share of this expansion is being funded by Joint
Power Authority financing.
The City's existing system of charges is based on equivalent dwelling units
(EDUs). A few customers. whose primary activity involves use of water
and very large water users, are charged on water usage as well as EDC's.
The existing charge fcir most customers is $7.30 per EDU per month.
Restaurants are charged $14.25 per EDU per irionth. These rates are the
lowest in the Encina system.
3.
EXHIBIT 2
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4. Billing for sewer service is done monthly along with water bills. This is
facilitated by the fact that the City is the water purveyor and has ready
access to the water consumption records of its customers.
The City’s present EDU system does not meet EPA guidelines of fairness
and equity required for grant financed facilities such as EWPCF. A more
equitable method of charging customers for sewer service is that based on
flow and strength.
5.
6. Increasing costs of treatment and complying with more stringent regulator?
requirements will cause the City’s expenses to be increased by an estiiriared
44 percent the next fiscal year and six percent per year for the subseqgent
four years reviewed.
7. Encina Administrative Agency Will manage and administer the
pretreatment program From FY 1990-91. In the past, this prograin wa3
administered by the County of San Diego. The City was not billed for
several years and hence these costs were not budgeted and revenues not
collected during thait time. Future costs of this program will be
administered equitably.
8. The capital improvement program at Encina, the connection fees to be
charged to new customers and the related cash inflows and outflows are
covered in the City’s sewer master plan prepared by Wilson Engineering.
The Department’s operating and capital expansion reserves are healthy b)
utility standards.
9.
RECOMMENDATIONS
1. In order to comply with EPA regulations for fair and equitable rates. the
City must switch to a system of rates based on flow and strength.
2. We recommend six classes of customers categorized by quality of
wastewater. These are Group I-Residential, Group 11-Low Strength
Commercial, Group I[I-Medium Strength Commercial, Group IV-High
Strength Commercial, Group V-Institutional and Group VI Large Volume
Users. Low strength users are those whose combined strength expressed in
terms of biochemical oxygen demand (130D) and suspended solids (SS) is
less than 400 mg/l. This group includes car washes, offices, retail stores.
laundromats, warehouses, hospitals and convalescent homes. and indoor
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theatres. Medium strength users are those whose combined strength is at
least 400 mg/l but less than 1000 mg/l. This group includes hotels/moteIs
without restaurants or kitchens, service stations, shopping centers.
commercial laundries, and industrial users. High strength users are those
whose strength is 1000 mg/l cIr greater and include restaurants, bakeries.
food processors, supermarkets, mortuaries and hotels with restaurants.
Institutional users are schools and membership organizations like churches.
social service clubs. Large volume users are customers who use in excess of
25,000 gpd. These customers have rates set individually based on their
strength.
The rates recommended for the different groups for FY 1990-91 are shown below. Residences are ffat rated at $11.58 per month. All other customers pay based on their water usage, subject to a minimum monthly dwge as shown below.
3.
SEmR RATE CHARGES*
UNrr MINIMUM
COST MONTHLY
USERS $Am CHARGE
G-1- $1.56 $11.58
Group II Commerciai $1.43 $11.58
GroupIIICwrmercial $1.87 $1 1-58
Group IV Commerciat $2.96 $11.58
GroupVIasthtid $1.42 $11.58
SC&QiSpatADA
===taw $0.26
Junior $0.51
Boarding $3.86
=& m.77
(..roup VILarge Volume Users
HughesAkcraft $1.15 $11.58
kbnan Micro Oper 1 $3.88 $1 1.58
-gaa $1.11 --- $11.58
*fqxasiugflIufrktruicdepraParirur
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4. We recommend a deposit be collected for installation of laterals. This
deposit should be $2,500 to ensure that actual costs of installation are
recovered. On completion of the job the balance, if any, should be
returned.
5. We recommend that users requiring pretreatment be categorized into classes
depending upon the quality of their wastewater, their size and the number
of inspections required per year. Part of the costs of pretreatment program
should be borne by those users in proportion to the costs incurred. These
costs should be prorated so that users are charged for a portion of the costs
each month as opposed to being charged a lump sum when the work ;S
actually performed. A preliminary schedule of fees is shown below. We
recommend that these fees be revised when the program is under way and
users have been categorized. Classes are defined in Chapter 5.
PRETREATMENT FEES PER MONTH
Class 1 $250
Class 2 $150
Class 3 $25
6. We recommend the City categorize all its commercial, industrial and
institutional customers per the classifications listed above as soon ab
possible to implement the new rates.
7. We recommend that depreciation be expensed to refIect the value of assets
owned by the City. The recommended rates shown in this chapter are
based on depreciation expensed at 75 percent of that calculated on historic
cost of assets. It is recommended that depreciation be increased gradually
to 100 percent based on historic cost of assets.
8. No changes are recommended in the City’s operating reserves. A new
replacement reserve to be funded by depreciation must be created. This
will be used to Finance replacements of the City’s sewer collection system.
The capital expansion reserve will continue to be funded by connection
fees.
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