HomeMy WebLinkAbout2019-11-19; City Council; ; Public Hearing for approval of a potable water rate structure modification and proposed two-year rates for potable water, recycled water and wastewater.For wastewater, the Study recommends a 3% revenue increase effective Jan. 1, 2020, and
another 3% revenue increase effective Jan. 1, 2021. Wastewater rates have been held flat for
the last four years. Staff recommends a combination of wastewater rate increases and the use
of reserve funds to meet the revenue requirements in CYs 2020 and 2021.
The city and CMWD are required to notify customers at least 45 days in advance of a Majority-
Protest Public Hearing for City Council and the CMWD Board consideration of changes to the
rate structures and schedule of rates. On Sept. 17, 2019, the City Council and CMWD Board
approved setting the date of this Public Hearing for Nov. 19, 2019, to hold the Majority-Protest
Public Hearing and potentially approve the potable water rate structure modification and
proposed two-year utilities rates for potable and recycled water and wastewater.
Discussion
CMWD provides reliable, safe drinking (potable) and recycled water to homes and businesses
within a 32.3-square mile service area (Exhibit 6). There are approximately 30,170 potable and
recycled water connections within the service area. CMWD is estimating a 1% increase in
demand for fiscal year (FY) 2019-20 and a 1.8% increase by FY 2020-21. The demand increase is
due largely to new development.
The city provides wastewater services within a 30-square mile area (Exhibit 5). The wastewater
system meets stringent regulations as it conveys wastewater from homes and businesses to the
Encina Water Pollution Control Facility (EWPCF) for treatment. There are approximately 24,000
wastewater connections within the service area.
A portion of the water from EWPCF is further treated at the Carlsbad Recycled Water Facility
(CRWF) and is redelivered to customers through the CMWD recycled water system for
landscape irrigation and other industrial-type uses that require process water.
Cost of Service Study Process
Carollo recently completed the Study on behalf of the city and CMWD. The principal objectives
of the Study were as follows:
1) Water and Sewer Revenue Sufficiency Analysis -Develop multi-year forecasting
Microsoft Excel models for potable water, recycled water and wastewater. These
models contain the necessa·ry data to determine the level of annual revenue required to
meet each system's projected annual operating, debt service and capital cost
requirements while maintaining adequate reserve levels.
2) Cost of Service Analysis -Complete a thorough cost allocation process to reflect the
appropriate distribution of system costs to system functions and ultimately rate classes,
based upon data such as average day, maximum day and peak-hour demands to ensure
a fair and equitable distribution of costs by rate classification.
3) Rate Calculation -Review each utility's existing rate structure and develop appropriate
modifications to ensure that rates reflect accepted industry practice and an equitable
distribution of costs, enhance transparency and adhere to cost-based pricing principles.
Nov. 19, 2019 Item #16 Page 2 of 158
Additionally, Carollo took a holistic look at each utility system and its relationship with each
customer class to ensure continued compliance with all applicable laws, including Proposition
218.
Potable and Recycled Water -Existing Rate Structures
The existing rate structures consist of a base monthly delivery charge and a volumetric usage
charge. The base monthly delivery charge is a fixed charge imposed regardless of water
consumption and is proportionate to the size of the customer's water meter. This fixed delivery
charge recovers operating costs such as staffing, customer service and utility billing, as well as a
portion of the infrastructure service costs including operations, maintenance and capital
replacement funding. The volumetric usage charge is based on actual water consumption and
recovers the cost of purchased water, variable operating costs such as electricity and chemicals,
and approximately 50% of capital costs that are not funded using existing reserves.
Potable and Recycled Water -Proposed CY 2020 Rate Structure
The Study recommends one rate structu re change for potable water -eliminating the Tier 3
category for the multi-family volumetric rate charge. Due to shifting customer demands, the
Tier 3 usage demand is very low (5%). Removing Tier 3 and adjusting the rates for Tier 2 ensures
the rate structure continues to reasonably reflect the proportional cost of providing service.
The Study does not recommend changes to the existing recycled water rate structure.
Potable Water Rates
Potable water rates were held flat for the last two years due to sufficient reserve
funding that met operating, maintenance and capital replacement costs. To meet the
Study's potable water revenue requirement, staff recommends a combination of
reserve funding and rate increases effective Jan. 1, 2020, and Jan. 1, 2021. Rates are
allocated to customer classes based on each class's proportionate share of the system,
which explains the variation in rate increases across customer classes.
The proposed increase in potable water rates is primarily driven by increases in the cost
of water purchased from the San Diego County Water Authority (SDCWA), increases in
cost of desalination water and increases in operating costs due to inflation.
CMWD is a member agency of SDCWA and purchases all its potable water from SDCWA.
This purchase comprises approximately 55% of CMWD's total annual Operating Budget
and includes 2,500 acre-feet annually of desalinated water, which is a local drought-
resilient water supply. SDCWA projected high increases in the cost oftreated water for
FY 2019-20. However, SDCWA is mitigating rate impacts to member agencies through a
planned draw on their rate stab ilization fund of approximately $22 million for FY 2019-
20 and $38 million for FY 2020-21.
Due to CMWD's specific allocated share of SDCWA fixed costs and projected water
purchases for FY 2019-20 and FY 2020-21, the effective increase in SDCWA purchase
costs for CMWD is approximately 3.5%. The SDCWA increase is primarily driven by:
Nov. 19, 2019 Item #16 Page 3 of 158
1) Decreased water sales demand forecast after the outcomes from drought
regulation and water conservation
2) An approximate 5% increase in Metropolitan Water District's {MWD) water rates
and transportation charges, which are passed-through via the SDCWA
3) Increased Capital Improvement Program {CIP) expenditures due to increases in
cost of steel and cement/concrete and shortage of skilled labor
4) Expenditures associated with shared reservoirs
5) Construction of new seawater intake-discharge facilities at the desalination plant
in Carlsbad to comply with updated environmental standards
The current and proposed potable water rates by customer class are shown in Exhibit 3.
Potable water is a very affordable beverage. Fifty dollars can purchase 3 gallons of brand
coffee, 8 gallons of brand soda, 15 gallons of milk, 45 gallons of bottled water or 7,256
gallons of CMWD water. A gallon of CMWD water costs less than a penny.
Recycled Water Rates
There will be no proposed rate increases for recycled water. Staff recommends
maintaining the current recycled water rates for CYs 2020 and 2021.
Wastewater Structure
There are no proposed changes to the existing wastewater rate structure. The Study does
recommend moving breweries into their own classes to establish rates that are commensurate
with their impact on the wastewater system. Brewery waste is typically very high in biochemical
oxygen demand {BOD) and total suspended solids {TSS) concentrations. The high
concentrations can lead to increased degradation of wastewater infrastructure and drive higher
treatment costs.
Customers would be migrated into one of four new brewery classes once their business is
identified as a brewery via the city's business license application process. Currently, there are
approximately 10 breweries in Carlsbad. Breweries will be placed into rate classes depending
on whether or not they also operate as a restaurant. The rates for each class are developed
based on the assumption that half of a user's wastewater is generated by brewing and half is
from the restaurant or general commercial operation (restrooms, breakrooms, etc.). The BOD
and TSS loading assumptions are adjusted for each type of user accordingly.
For breweries that haul their brewing waste offsite for treatment, those without restaurants
will be charged a rate equal to the C2 commercial rate, and those with restaurants will be
charged a higher rate. Breweries that fall into the B2 and B4 classes (those that do not haul
their brewery waste for outside treatment) would have higher rates than those that do haul
their waste for outside treatment.
The use of classes for breweries also assists staff in identifying these businesses, providing
outreach and ensuring that they are in compliance with waste discharge requirements. The
proposed new brewery classes are as follows:
Nov. 19, 2019 Item #16 Page 4 of 158
Bl -Brewery without a restaurant and hauls waste for outside treatment
B2 -Brewery without a restaurant and does not haul waste for outside treatment
B3 -Brewery with a restaurant and hauls waste for outside treatment
B4 -Brewery with a restaurant and does not haul waste for outside treatment
Staff reviewed brewery rates at neighboring agencies, and the proposed brewery rates are
reasonable in comparison. Additionally, staff hand delivered the rate notices, which explain the
new brewery classes and proposed rates, to each brewery. Also, staff has been working with
these businesses regarding requirements for placement into the Bl and B3 classes. In
recognition of the high concentration of waste produced, one brewery has already begun
diverting this waste stream and would therefore fall into the Bl or B3 class now.
Wastewater Rates
Wastewater rates have been held flat for the past four years, as the utility experienced lower
than anticipated expenditures for several years in a row that increased the reserves. The
recommended revenue increase is 3% effective for one year beginning Jan. 1, 2020, and 3% for
one year beginning Jan. 1, 2021. A portion of wastewater operating reserves will be used to
offset the rate increases.
The proposed rate increases are needed primarily for:
1. EWPCF's three-year 100% CalPERS retirement liability payoff
2. Increased energy and chemical costs
3. Capital budget for EWPCF infrastructure of $95 million over the next 10 years
4. Approximately $63 million over 15 years in the city's approved FY 2019-20 CIP
for assessment, repair and rehabilitation of the wastewater system to extend the
useful life of the system assets
5. Basic increases in the city's operating costs due to inflation
The current and proposed wastewater rates by customer class for wastewater are shown in
Exhibit 3.
Proposition 218 Notice
The City of Carlsbad and CMWD notified customers at least 45 days in advance of holding the
Public Hearing by mailing written notices of the proposed changes to the wastewater, potable
water and recycled water rate structures and schedule of rates to all property owners and
utility customers via U.S. mail on Oct. 1, 2019. The Public Hea ring must be held a minimum of
30 days before changes to the rate structure or existing rates can be enacted. Customers have
the right to protest the changes by submitting their concerns in writing to the office of the city
clerk any time before close of tonight's Public Hearing.
If less than a majority of protests are received tonight, the City Council and CMWD Board may
consider the proposed changes to the potable water rate structure and schedule of rates for
wastewater, potable water and recycled water.
Nov. 19, 2019 Item #16 Page 5 of 158
Fiscal Analysis
If approved, the proposed potable water rate structure change and potable water and
wastewater rate increases will be effective Jan. 1, 2020, and Jan. 1, 2021, as described above,
and will provide adequate funding to properly operate and maintain Carlsbad's water and
wastewater systems and maintain reserves. Exhibit 3 shows the current and proposed rate
changes for each utility.
Recommended Potable Water Rate Increase:
After holding rates flat for the past two years, the Study recommends increasing potable water
revenue by 1% effective Jan . 1, 2020, and by 2% effective Jan. 1, 2021. For CY 2020, the 1% rate
revenue increase will impact each class differently due to the cost of service adjustment and
restructuring of the rates. For example, the Study's updated customer demand analysis found
that irrigation customers are responsible for slightly more peak usage costs than under the
current rate structure. Thus, the irrigation volumetric rate for CY 2020 has an increase above
the overall 1% rate revenue increase.
The Study also recommends adjusting the fixed delivery charges to account for shifting demand
patterns between classes, and to more closely align revenue collection with expenditures. For
example, the fixed delivery charge for a 5/8" meter is proposed to increase approximately
1.21% from $24.72 to $25.02, an increase of $0.30. The fixed delivery charge for a 3/4" meter is
proposed to increase approximately L20% from $33.36 to $33. 76, an increase of $0.40.
The recommended increase in potable water rates is also influenced by the current desalination
rate associated with purchasing 2,500 acre-feet of water under the Uniform Member Agency
Purchase Contract (UMAPC}. The current UMAPC desalination rate is approximately $2,788 per
acre-foot, in comparison to the SDCWA blended rate of approximately $1,750 per acre-foot.
Staff estimates the purchase of desalinated water would not have been necessary if customers
used water consistently at the winter demand level and did not exhibit a seasonal peak in
demand. Based on the supply cost allocation approach used in the Study, the cost of providing
desalinated water was allocated to customers that place a high-peak demand on the water
system, such as residential customers, above the average single-family residential winter water
use, agricultural and irrigation customers.
A target operating reserve of 40% of the Operations and Maintenance Budget, better than
anticipated financial results and long-range financial planning have helped temper the
recommended potable water rate increase by creating surplus operating reserves that CMWD
can utilize to reduce rate increases in the near-term.
Staff recommends using operating reserves to soften the potable water rate increases for the
next two years. Approximately 1.6% of reserves would be used during FY 2019-20 and
approximately 0.60% of reserves in FY 2020-21. If the rates were held flat for the next two
years, ratepayers would experience higher rate increases in future years to maintain reserves.
In addition to using operating reserves in FY 2019-20 for rate smoothing, approximately $2
million in capital reserves will be used to fund CIP projects. All proposed potable water rates are
shown in Exhibit 3.
Nov. 19, 2019 Item #16 Page 6 of 158
Recommended Recycled Water Rate:
No increase in recycled water revenue for the next two years is needed. Staff recommends
holding recycled water rates flat in CYs 2020 and 2021.
The recycled water volumetric rate is less than the potable water agricultural and irrigation
rates. The recycled water system provides a drought-resilient local supply, helps conserve
-potable water and reduces reliance on imported water. The recycled water rates are shown in
Exhibit 3 and reflect the utility's cost of providing services for CYs 2020 and 2021.
Recommended Wastewater Rates:
_ After holding the rates flat for the past four years, the Study recommends increasing
wastewater revenue by 3% for CY 2020 and an additional 3% for CY 2021. Staff recommends
using wastewater reserves over the next several years to partially offset rate increases.
Approximately 42% of operating reserves in FY 2019-20 and 1.3% of operating reserves in FY
2020-21 will be used to smooth rate increases. Additionally, $4.5 million of existing capital
reserves in FY 2019-20 and $13.8 million of existing capital reserves in FY 2020-21 will be used
to fund capital improvements. To maintain sufficient reserves, wastewater increases are
necessary in order to avoid a large increase later.
The proposed wastewater rates are shown in Exhibit 3 and reflect the utility's cost of providing
wastewater services for the next two years. The rates include new classes for breweries to
ensure cost recovery commensurate with their impact to the wastewater system.
Example Monthly Bill:
The following table provides an estimated monthly bill if the proposed increases are approved:
Current Bill Proposed Bill Proposed Bill
(Jan. 1, 2020) (Jan. 1, 2021)
Potable Water1a $68.81 $70.55 $72.42
Wastewater1b $27.81 $28.66 $29.52
Total Single Family Residential $96.62 $99.21 $101.94
1. Assumes an average single-family residence: a. Potable Water: 5/8" meter using 11 units per month, b. Wastewater:
Pays a flat monthly charge
Multi-Year Rates:
Proposition 218 requires noticing customers of the Public Hearing and potential changes to the
rate structures and rate schedule. Using a multi-year rate approach and combining the noticing
spreads the costs among all three utilities, thereby increasing economies of scale.
While a 40% reserve funding level was established in the FY 2019-20 Operating Budget, the city
and CMWD will propose a more detailed reserve policy for utilities that uses additional best
practices and includes rate stabilization fund accounts.
Nov. 19, 2019 Item #16 Page 7 of 158
Next Steps
If approved, the city and CMWD will implement a potable water rate structure modification and
two-year rates for wastewater, and potable and recycled water effective Jan. 1, 2020, for CY
2020, and Jan. 1, 2021, for CY 2021.
Staff will work with the City of Carlsbad's Finance Department to expand the current utilities
reserve policy for consideration during the FY 2020-21 budget process.
Environmental Evaluation (CEQA)
This project is exempt from the California Environmental Quality Act (CEQA) per State CEQA
Guidelines Section 15273(a) -modification, structuring, restructuring, or approval of rates,
tolls, fares, or other charges by public agencies.
Public Notification and Outreach
The California Constitution, Article XIIID, Section 6, states that local governments must hold a
Majority-Protest Public Hearing and notify property owners and customers at least 45 days in
advance of public hearings related to proposed water, recycled water and wastewater rates.
At the Public Hearing, if it is determined that a majority of affected customers and property
owners have submitted formal protests, the proposed fee changes must be rejected. This is a
requirement of Proposition 218, passed by California voters in 1996, to limit methods by which
local governments can create or increase taxes, fees and charges without taxpayer consent. Any
affected customers and property owners interested in objecting to the increases may file a
signed written protest with the office of the city clerk. The written protest must contain the
address of service, the rate change being protested and be received prior to close of the Public
Hearing. While protesters may appear at the hearing and be heard on the matter, only written
protests are considered as part of the majority protest.
Staff took the following actions at least 45 days prior to the Nov. 19, 2019, Public Hearing date:
• Notified affected customers and property owners by mail of the Public Hearing
• The Notice (Exhibit 3) provided information related to the Public Hearing proposed rates
• In addition, information about the Majority-Protest Public Hearing and proposed rates was
posted on the city's website at www.carlsbadca.gov/finance.
Information regarding public notifications of this item such as mailings, Public Hearing notices
posted in the newspaper and on the city website is available in the office of the city clerk.
Exhibits
1. City Council Resolution
2. CMWD Board Resolution
3. Notice of Public Hearing and Proposed Multi-Year Rates
4. 2019 Utilities Cost of Service Studies
5. City of Carlsbad Wastewater Service Area Map
6. CMWD Water Service Area Map
7. Protest letters received as of Nov. 14, 2019
Nov. 19, 2019 Item #16 Page 8 of 158
RESOLUTION NO. 2019-244
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, APPROVING TWO-YEAR RATES FOR WASTEWATER
SERVICES.
WHEREAS, the California Constitution Article XIII D § 6(a)(2) requires local governments
hold a Majority-Protest Public Hearing and notify customers not less than 45 days in advance of
the Public Hearing before increasing in wastewater service rates; and
WHEREAS, the city is proposing wastewater service rate increases effective Jan. 1, 2020
and Jan. l,2021;and
WHEREAS, On Oct. 1, 2019, Carlsbad residents and property owners were notified by mail
of the proposed new wastewater rates, thereby complying with the advance notice requirement
of 45 days; and
WHEREAS, on Nov. 19, 2019, the City Council of the City of Carlsbad held a Majority-
Protest Public Hearing regarding the increases in wastewater rates.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California,
as follows:
1. That the above recitations are true and correct.
2. That the City Council of the City of Carlsbad hereby approves the wastewater rate
increases of 3% effective Jan. 1, 2020, and Jan. 1, 2021.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City
of Carlsbad on the 19th day of November 2019, by the following vote, to wit:
AYES: Hall, Blackburn, Bhat-Patel, Schumacher.
NAYS: None.
ABSENT: None.
MA HALL, Ma or
r.~, Hec-w6~z1 Depv!J
70 BARBARA ENGLESON, City Clerk c;{j
Cieri('
(SEAL)
Nov. 19, 2019 Item #16 Page 9 of 158
RESOLUTION NO. 1624
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CARLSBAD MUNICIPAL
WATER DISTRICT OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A
POTABLE WATER RATE STRUCTURE MODIFICATION AND TWO-YEAR RATES
FOR POTABLE WATER AND RECYCLED WATER SERVICES.
WHEREAS, the California Constitution Article XIII D § 6(a)(2) requires local governments hold a
Majority-Protest Public Hearing and notify customers not less than 45 days in advance of the hearing
before increasing water service rates; and
WHEREAS, the Carlsbad Municipal Water District (CMWD) is proposing a potable water rate
structure modification and two-year potable and recycled water service rates, effective Jan. 1, 2020, and
Jan. 1, 2021; and
WHEREAS, on Oct. 1, 2019, CMWD service area customers and property owners were notified by
mail of the proposed potable water rate structure modification and proposed two-year rates for potable
water and recycled water services; and
WHEREAS, on Nov. 19, 2019, the CMWD Board of Directors held a Majority-Protest Public Hearing
and approved the new potable water rate structure and two-year rates for potable water and recycled
water services.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of Carlsbad Municipal Water District
of the City of Carlsbad, California, as follows:
l. That the above recitations are true and correct.
2. That the Board of Directors of the Carlsbad Municipal Water District hereby approves the
potable water rate structure modification and two-year rates for potable and recycled water, effective
Jan. 1,2020,andJan. 1,2021.
PASSED, APPROVED AND ADOPTED at a Joint Special Meeting of the Board of Directors of the
Carlsbad Municipal Water District of the City of Carlsbad, California and the City Council of the City of
Carlsbad, California on the 19th day of November 2019, by the following vote, to wit:
AYES: Hall, Blackburn, Bhat-Patel, Schumacher.
NAYS:
ABSENT:
(SEAL)
Nov. 19, 2019 Item #16 Page 10 of 158
Proposed Changes to Water and
Wastewater Rates
The Carlsbad Municipal Water District, a subsidiary district
of the City of Carlsbad, provides reliable safe drinking
water and recycled water within its service area, and
purchases 100 percent of its drinking water from the
San Diego County Water Authority (SDCWA). The cost
to purchase imported water continues to increase. The
District proactively plans for increases in costs associated
with op.erations, maintenance, and replacement of
aging or failing infrastructure.1o accommodate these
anticipated increases in cost, an increase in potable water
rates over the next two years is being proposed. Potable
water rates were held flat the last two years. No rate
increase is proposed for recycled water.
The City of Carlsbad owns and maintains a sanitary
sewer system that provides customers with wastewater
collection and conveyance services to a jointly owned
wastewater treatment plant (Encina). The City proactively
plans for increases in costs associated with operations,
maintenance, and replacement of aging or failing
infrastructure. The City also pays a percentage share of
the operation, maintenance, and capital replacement
costs at the Encina plant. Toaccommo·date these
anticipated increases in cos°!, an increase in wastewater
rates over the next two years is being proposed. This
will be the first increase in four years, as the City has
successfully held rates flat for that time frame.
If the Carlsbad Municipal Water District Board of Directors
and the City of Carlsbad City Council approve the rate
increases at the public hearing on Nov. 19, 2019, the new
rates for the upcoming year will be effective Jan. 1, 2020
and the second year will be effective on Jan. 1, 2021.
The proposed rates will enable the District and the
City to continue to provide quality services in a fiscally
responsible manner by funding ongoing operations,
maintenance, and replacement ofthe water and
wastewater system, as well as maintaining adequate
operating reserves.
How your Water Rate is Calculated
To meet the revenue needs for purchasing imported
water and maintaining the di~tribution system, the
proposed rate changes in the following tables are being
recommended. Proposed rates are allocated to each
customer class based on their proportionate use of the
water system.
There are two components to the water rates: the usage
charge and the monthly delivery charge. The usage
charge is the charge for the volume of water used. The
monthly delivery charge is a fixed charge based on the
size ofthe meter. Residential meters are typically 5/8" to
1 ". Larger meters are primarily for larger water demands,
such as commercial buildings.
Monthly Potable Water Delivery Charge
Two Year Maximum Rate Increase
Meter Size:
5/8" I
3/4"
1"
1.5''
2"
2.5"
3"
4"
6"
8"
10"
1 unit= 748 gallons
Current
$24.72
$33.36
$50.62
$93.79
$145.58
$206.07
$266.52
$439.10
$870.76
$1,388.75
$1,993.06
1/1/2020 ·1 1/1/2021
Proposed Proposed
$25.02 $25.52
$33.76 $34.44
$51.25 $52.28
$94.98 $96.88
$147.45 $150.40
$208.67 $212.84
$269.88 $275.28
$444.79 $453.68
$882.05 $899.69
$1,406.76 $1,434.89
$2,018.92 $2,059.30
Residential Water Rates
Residential rates are grouped into tiers, with Tier 1
having the lowest per unit rate and the Tier 2 having an
incrementally higher rate. The tier rate that is charged
depends on a customer's actual water usage. Tier 1
is designed to meet water use essential for internal
residential use. Tier 2 is designed to meet exterior
landscaping requirements for typical residential
property. The water rate structure is designed to be
more consistent with actual demand, ensure adequate
cost recovery for water services, and ensure adequate
reserve funding.
Non-Residential Water Rates
Non-residential customers have different water usage
needs than residential customers; therefore, the
usage charge is a flat per unit rate rather than a tiered
rate. Examples of non-residential customers include
commercial, agricultural, and irrigation.
Water Usage Charge
Two Year Maximum Rate Increase
1 unit = 748 gallons
11/1/2020 11/1/2021 ($/unit) ($/unit) ($/unit)
Current Tier I Current Proposed Proposed
Single Family Rates
Tier 1 (0-1 O units) $3.94 $4.04 $4.13
Tier 2 (>10) $4.69 $4.42 $4.51
Tier 3 (19+ units) $7.00 $7.04 $7.18
Multi-Family Rates
Tier 1 (0-5 units) $3.87 $3.87 $3.95
Tier 2 (>10) $4.67 $4.94 $5.04
Tier 3. (11+ units) $6.97 n/a n/a
Non-Residential Rates
Commercial $4.22 $4.27 $4.36
Agricultural Rates $4.53 $4.62 $4.71
Irrigation Rate $5.16 $5.31 $5.41
Recycled Water Rates
The recycled water rate will remain unchanged. The
recycled water cost is estimated based on the cost of
treatment, and operation and maintenance costs of the
distribution system, as well as adequate reserve funding.
Monthly Recycled Water Usage Charge
Two Year Rates
1 Unit= 748 gallons
Current ' Recycled Water Rates l $3.79
Protesting the Rates
1/1/2020
Proposed
$3.79
1/1/2021
Proposed
$3.79
Monthly Recycled Water Delivery Charge
Two Year Rates
Current
Meter Size:
5/8" $ 23.69
3/4" $ 32.69
1" $ 50.70
1.5" $ 95.73
2" $ 149.75
2.5" $ 212.84
3" $ 275.90
4" $ 455.93
6" $ 906.18
8" $1,446.47
10" $2,076.82
Fire Protection
1/1/2020
Proposed
$ 23.69
$ 32.69
$ 50.70
$ 95.73
$ 149.75
$ 212.84
$ 275.90
$ 455.93
$ 906.18
$1,446.47
$2,076.82
1/1[2021
Proposed
$ 23.69
$ 32.69
$ 50.70
$ 95.73
$ 149.75
$ 212.84
$ 275.90
$ 455.93
$ 906.18
$1,446.47
$2,076.82
Some customers have separate fire meters and lines
for fire suppression sprinklers. The fire meters and
lines require maintenance, service, and a portion
of system capacity. The service connection size
is the basis of the charge and can be measured
either by the meter size or by the service line size.
In cases where a meter is installed, which restricts
the capacity of the connection and measures total
water consumption, the charges will be based on the
meter size. For fire lines that have a meter that is in
place only to inform the District when water is drawn
through the pipe and does not restrict water flows,
the charge will be based on the service line size.
Setting charges based on service connection size
ensures legal compliance and ratepayer equity.
As the property owner/ratepayer, you have the right to protest the proposed increases. Only one protest notice is allowed
per parcel. If you choose to protest, you must submit a signed written protest to the City Clerk on or before the close of
the hearing. The written protest must contain your full name and signature, parcel number, and the rate change being
protested. Email protests do not satisfy the signed written protesting requirement. If it is determined that a majority of
property owners have submitted a formal ·protest, the proposed fee change must be rejected. The protester may appear
at the hearing and be heard on the matter; however a written protest is also required. Please send all protests to: Office
of the City Clerk, City of Carlsbad, 1200 Carlsbad Village Drive, Carlsbad CA 92008.
Nov. 19, 2019 Item #16 Page 12 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Appendix C
REVENUE REQUIREMENT ANALYSIS
FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
CASH FLOW TESTS
REVENUES
Charges for Services $ 13,757,100 $ 14,295,130 $ 14,819,300 $ 15,298,150 $ 15,784,700
Fines and Forfeitures 87,800 88,580 89,150 89,350 89,510
Income from Property & Investments 161,870 98,270 102,430 109,920 105,320
l nte rdepa rtmenta I 83,400 85,490 87,630 89,820 92,070
Other Revenues 74,800 76,670 78,590 80,550 82,560
Connection Fees
Total Revenues 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 $ 16,154,160
EXPENDITURES
Ongoing Operating Expenses
Personnel 2,442,385 $ 2,563,257 2,674,691 $ 2,783,452 $ 2,882,607
Encina Operations 4,101,976 4,240,800 4,374,270 4,493,450 4,613,660
Maintenance & Equipment 4,258,852 4,329,330 4,401,490 3,255,209 3,323,814
Capital Outlay
Other Financing Uses
Other Operating Expenses
One-time Funding (1,060,726) (1,081,941) (1,103,580) (1,125,651)
Rate Funded Capital
Debt Service
Total Operating Expenditures $ 10,803,213 $ 10,072,661 $ 10,368,510 $ 9,428,531 $ 9,694,429
Policy Expenditures
Replacement Funding $ 3,800,000 $ 3,895,000 3,992,380 $ 4,092,190 4,194,490
Transfers to Capital Fund 2,975,000
Additions to Meet Minimum Fund Balances
Total Policy Expenditures $ 6,775,000 $ 3,895,000 $ 3,992,380 $ 4,092,190 $ 4,194,490
POLICY OVERRIDES
Repla~ement Funding
Transfers to Capital Fund
Additions to Meet Minimur:n Fund Balances(*)
Total Expenditures $ 17,578,213 $ 13,967,661 $ 14,360,890 $ 13,520,721 $ 13,888,919
Includes transfer. Does not include depreciation
Cash Flow Surplus (Deficit) $ (3,413,243) $ 676,479 $ 816,210 $ 2,147,069 $ 2,265,241
DEBT COVERAGE TEST
REVENUES
Operating Revenues 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 $ 16,154,160
Connection Fee Revenues Allowed
Total REVENUES $ 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 $ 16,154,160
EXPENDITURES
Personnel $ 2,442,385 2,563,257 $ 2,674,691 $ 2,783,452 $ 2,882,607
Maintenance & Equipment 4,258,852 4,329,330 4,401,490 3,255,209 3,323,814
Debt Service
One-time Funding (1,060,726) (1,081,941) (1,103,580) (1,125,651)
Coverage
Total EXPENDITURES $ 6,701,237 $ 5,831,861 $ 5,994,240 $ 4,935,081 $ 5,080,769
Bond Coverage Surplus (Deficit) $ 7,463,733 $ 8,812,279 $ 9,182,860 $ 10,732,709 $ 11,073,391
OCTOBER 2019 I FINAL C c;:,r~•·~·
Nov. 19, 2019 Item #16 Page 45 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
Appendix E
WASTEWATER CUSTOMER ALLOCATION
GROUP I· GROUP II.. GROUP Ill -GROUP IV_ GROUP V -GROUP V • GROUP V _ GROUP V • GROUP VI -Industrial
CUSTOMER STATISTICS GROUP 1-SFR MRF/MOBILE Commercial 2 Commercial J Comn,erdal 4 Elementary Junior High High Schools Boarding Brewerier. Large Volume Pretreatment TOTAL
HOME Schools Schools Schools (no account&} Class Ill
Assumed Flow (ccf)
80D(lbs)
TSS (lbs)
EDUs (Monthly)
2,095,027 ccf
2,615,584 lbs
2,615,584 lbs
21,645 EDUs
536,781 ccf
670,156 lbs
670,156 lbs
5,546 EDUs
427,847 ccf
348,060 lbs
320,097 lbs
3,605 EDUs
460,388 ccf
943,600 lbs
801,501 lbs
6,075 EDUs
161,631 ccf
827,349 lbs
686,094 lbs
4,056 EDUs
16,214 ccf
13,158 lbs
10,121 lbs
134 EDUs
9,570 ccf
7,766 lbs
5,974 lbs
79 EDUs
17,804 ccf
14,448 lbs
11,114 lbs
147 EDUs
7,096 ccf
5,758 lbs
4,430 lbs
58EDUs
Occf
0 lbs
O lbs
0 EDUs
0 ccf
0 lbs
0 lbs
0 EDUs
4,465 ccf 3,736,824 ccf
8,301 lbs 5,454,181 lbs
13,269 lbs 5,138,340 lbs
65 EDUs 41,409 EDUs
GROUP 1.. GROUP II -GROUP Ill -GROUP IV_ GROUP V-GROUP V • GROUP V. GROUP V • GROUP VI.. Industrial
FLOW GROUP 1-SFR MRF/MOBILE Commercial '2 Commercial 3 Commerdol 4 Elemhent
1
ary Jv
5
niohr High High Schools B
5
oahrdln
1
g Breweries Lorge Volume) PreCt
1
reatm
11
e
1
nt Total
HOME Sc oo s c ools c 00 s (no occounls ass
Allocation Basis: )AssumedFlow{ccfJ l•i
Assumed Flow (ccf) 2,095,027 536,781 427,847_ 460,3_88 --~ -161,631 16,214 9,570 17,804 7,096 0 0 4,465 3,736,824
Allocation Adjustment Factor 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Adjusted Assumed Flow (ccf) 2,095,027 536,781 427,847 460,388 161,631 16,214 9,570 17,804 7,096 0 0 4,465 3,736,824
Allocated Customer Costs $ 3,956,898 $ 1,013,823 $ 808,078 $ 869,539 $ 305,275 $ 30,624 $ 18,076 $ 33,627 $ 13,402 $ $ $ 8,434 $ 7,057,775
GROUP I -GROUP II -GROUP Ill -GROUP IV. GROUP V -GROUP V -GROUP V _ GROUP V -GROUP VI. lnduslrial
BOD GROUP 1-SFR MRF/MOBILE Commercial 2 Commercial 3 Commercial 4 Elementary Junior High High Schools Boarding Brewerie.!. Large Volume Prelreatme-nt Toto I
HOME Schools Schools Schools (no accounts) Class Ill
Allocation Basis: Jeoo(lbs) :,...:
80D(lbs) 2,615,584 67D,156 348,060 943,600 827,349 13,158 7,766 14,448 5,758 0 0 8,301 5,454,181
Allocation Adjustment Factor 1.00 1.00 1.00 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Adjusted BOD (lbs) 2,615,584 670,156 348,060 943,600 827,349 13,158 7,766 14,448 5,758 0 0 8,301 5,454,181
Allocated Customer Costs $ 2,178,337 $ 558,126 $ 289,875 $ 785,859 $ 689,041 $ 10,958 $ 6,468 $ 12,033 $ 4,796 $ $ $ 6,913 $ 4,542,406
GROUP J. GROUP JI. GROUP Ill. GROUP IV. GROUP V • GROUP V • GROUP V. GROUP V. GROUP VI . lndu,1,;aJ
TSS GROUP I• SFR MRF/MOBILE Commercial 2 Commetciol 3 Commercial 4 Elementary Junior High High Schools Boarding Breweries. Lorge Volume Pretreatment Total
HOME Schools School! Schools (no accounts) Clan Ill
Allocation Basis: frss(lbsJ ~~-TSS (lbs) 2,61~,58_4 670,156 320,097 801,SD} 686,094 1(),121 s ,974 , __ 11,11_4 4,430 0 0 13,269 5,138,340
Allocation Adjustment Factor 1.0 1.0 1.0 1.0 1.0 1.0 l.D 1.0 1.0 1.0 1.0 1.0
Adjusted TSS (lbs) 2,615,584 670,156 320,097 801,501 686,094 10,121 5,974 11,114 4,430 0 0 13,269 5,138,340
Allocated Custonier Costs $ 1,308,027 $ 335,138 $ 160,077 $ 400,823 $ 343,109 $ 5,062 $ 2,988 $ 5,558 $ 2,215 s $ $ 6,636 $ 2,569,632
GROUP I• GROUP II -GROUP Ill -GROUP IV~ GROUP V. Elemenhny GROUP V. GROUP V. GROUP V. GROUP VI. 1ndu,trial
COST ALLOCATION SUMMARY GROUP I• SFR MRF/MOBILE . I . J • I S h I Junior High H. h S h I Boarding Brewe-ries large Volume Prelrealment Total HOME Co1nmerc1a 2 Commerc1a 3 Commerc1a 4 c 00 & School~ 1g c 00 & Schools (no accounts) Clan Ill
FLOW $ 3,956,898 $ 1,013,823 $ 808,078 $ 869,539 $ 305,275 $ 30,624 $ 18,076 $ 33,627" $ 13,402 $ $ $ 8,434 $ 7,057,775
BOD 2,178,337 558,126 289,875 785,859 689,041 10,958 6,468 12,033 4,796 6,913 4,542,406
TSS 1,308,027 335,138 160,077 400,823 343,109 5,062 2,988 5,558 2,215 6,636 2,569,632
TOTAL s 7,443,262 $ 1,907,087 $ 1,258,031 $ 2,056,221 $ 1,337,425 $ 46,644 $ 27,531 $ 51,217 $ 20,413 $ $ $ 21,983 $ 14,169,813
C car,-••~· FINAL I OCTOBER 20+9
Nov. 19, 2019 Item #16 Page 50 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Section 3 -Revenue Requirement .Analysis
The revenue requirement analysis is a comprehensive test of a utility's fiscal health, scrutinizing the
adequacy of current revenues, and setting the basis for rate planning. It reviews the utility's revenues,
expenses, debts, and reserve policies, assessing the viability of each metric going forward. Where cash
flows and balances are insufficient, the revenue requirement analysis determines the needed additional
cash flows to meet all funding goals.
The District's FYE 2020 budget expenses serve as the base year for O&M costs. Furthermore, Carollo
collected information related to current cash and restricted fund balances and policies, the budgeted
capital improvement plan expenditures, and all other operating and non-operating future revenues and
expenditures.
Once the revenue requirement is established by compiling all of the District's cost driver_s, two tests are
utilized to define the annual revenues necessary.
1. The cash flow soffkiencytest looks for a net positive cash flow at the end of each fiscal year. This
test looks at whether revenues exceed expenses; when they do not, this test recommends
additional revenue.
2. The second test is the debt seJVice coverage test. Utility bond issuances regularly include a stipulation
that the agency maintain sufficient cash flows to cover the planned debt service, plus an
additional percent of that debt service, typically between 25 and 40 percent.
3. Operating and Capital Budge_ts.
3.1 Capital Improvement Plan Funding
Though the District's CIP spending has been limited in recent years, significant improvements will likely
be required over time as the system ages. An analysis of the District's current assets found that the
system's total replacement value is approximately $1.3 billion for potable water assets, and $300 million
for recycled water assets. The prudent financial planning which led to reserve balance the District has
accumulated can be used to offset rate requirements at the time that improvements need to be
undertaken.
The District is in the process of finalizing a master plan for the potable and recycled water systems and
recently completed an asset management plan and a SCADA assessment. Based on the results of those
studies, the District plans to increase capital investment over the coming years.
Table 7 and Table 8 summarize the projected capital improvement plan (CIP) expenditures for the
potable and recycled water systems. A detailed summary showing the District's projects can be found in
Appendix C.
Table 7 Capital Improvement Plan Expenditures -Potable Water($ millions)
CIP I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Connection Fee Fund Projects $1.5 $0.0 $6.3 $1.8 $0.3
Replacement Fund Projects 8.8 7.3 12.1 16.2 18.2
TOT AL POTABLE WATER PROJECTS $10.3 $7.3 $18.4 $18.0 $18.5
TOTAL ESCALATED COST $10.6 $7.6 $19.7 $20.0 $21.2
* Line or column totals may not tie due to rounding
10 I OCTOBER 2019 I FINAL c · c;a,_ •• ,..
Nov. 19, 2019 Item #16 Page 72 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Table 17 Cash Flow Sufficiency Test-Recycled Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Pre-Rate Increase
Rate Revenues without Increases $7.79 $7.86 $7.91 $7.93 $7.94
Revenue from Previous Years' Increases 0.00 0.00 0.00 0.00 0.00
Offsetting Revenues 0.51 0.37 0.38 0.39 0.40
Operating Revenues $8.30 $8.23 $8.29 $8.32 $8.34
Less Operating Expenditures ($9.16) ($8.83) ($9.06) ($9.19) ($9.39)
Cash Flow Surplus/(Deficit) ($0.86) ($0.60) ($0.77) ($0.88) ($1.05)
Rate Increase .0.0% 0.0% 0.0% 0.0% 0.0%
Post-Rate Increase
Revenue from Increase $0.00 $0.00 $0.00 $0.00 $0.00
(Less): Rate Increase Delayl 0.00 0.00 0.00 0.00 0.00
Cash Flow Surplus/(Deficit) ($0.86) ($0.60) ($0.77) ($0 .88) ($1.05)
Beginning Operating Fund Balance $9.52 $8.66 $8.06 $7.29 $6.41
Cash Flow (0.86) (0.60) (0.77) (0.88) (1.05)
Other Transfers 0.00 0.00 0.00 0.00 0.00
ENDING OPERATING FUND BALANCE $8.66 $8.06 $7.29 $6.41 $5.36
Percent of Operations 95% 91% 80% 70% 57%
* Line or column totals may not tie due to rounding
3.3.2 Debt Coverage Test
The District's annual debt obligation for FYE 2020 through FYE 2024 is approximately $2.7 million. The
District's current and projected debt obligations are State Revolving Fund loans for the recycled water
system. This is stated as a debt service coverage ratio (DSCR) of l.lOx. However, the District has a best
practices target of maintaining a bond coverage ratio of 125 percent, or l.25x, of the annual debt service
obligation. The potable water system has no outstanding debt service obligations. Based on the
proposed rate revenue increases, the District will meet its debt coverage obligation for the entire five
year projections. Table 18 presents the calculation ofthe DSCR.
Table 18 Debt Service Coverage Test-Recycled Water
Budget Item j FYE 2020 j FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Recycled Revenues for Coverage $16.35 $16.20 $16.32 $16.37 $16.41 Test
Recycled Expenses for Coverage (6.43) (6.09) (6.29) (6.42) (6.62) Test
Net Revenue Available for $9.93 $10.11 $10.02 $9.94 $9.79 Coverage Test
Recycled Water Debt Service $2.74 $2.74 $2.77 $2.77 $2.77
Coverage (l.25x) 0.68 0.68 0.69 0.69 0.69
DSCR 2.90x 2.96x 2.89x 2.87x 2.82x
* Line or column totals may not tie due to rounding
16 I OCTOBER 2019 I FINAL C c~rl""-•,,..
Nov. 19, 2019 Item #16 Page 78 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Table 38 MFR Rate Design Summary, FYE 2020
Functional I FYE 2020 Revenue I Tier 1 I Tier 2
Component Requirement($ millions) ($/ccf) ($/ccf)
Base $0.43 $0.61 $0.61
Max Day 0.15 0.20 0.27
Max Hour 0.09 0.12 0.16
SDCWA 1.91 2.94 1.89
Desai 0.31 2.02
TOTAL $2.89 $3.87 $4.94
* Line or column totals may not tie due to rounding
5.3.2 Commercial, Agricultural, and Irrigation Rate Design
The water usage fee for the remaining customer classes are uniform rates charged regardless of usage.
Similar to the SFR and MFR rate design, the total cost of each functional category is divided by the total
usage for that customer class to produce a rate per ccf. The sum of all functional category unit rate
results in the customer class water usage fee as shown in Table 39.
Table 39 Commercial, Agricultural, and Irrigation Rate Design Summary, FYE 2020
Customer Base Max Max SDCWA D I R ProJected Rate
I I • I I I
Total Costs I . I . . esa to ecover Class ($ millions) Day Hour ($ mill ions) Demand (ccf) ($/ccf)
Commercial $0.76 $0.34 $0.20 $3 .28 0.76 $5.33 1,249,080 $4.27
Agricultural 0.05 0.02 0.01 0.19 0.12 0.40 86,688 $4.62
Irrigation 0.50 0.39 0.23 1.52 1.76 4.40 829,673 $5.31
* Line or column totals may not tie due to rounding
5.4 Proposed Potable Water Rates
Table 40 and Table 41 present the current and adopted potable water rates for the next two years. The
FYE 2020 overall annual rate adjustment of one percent will be implemented as a full cost of service
adjustment and will therefore impact each rate uniquely. FYE 2021 will have a two percent rate revenue
increase applied equally to all rates.
Tab le 40 Proposed Potable Water Delivery Fees
Meter Size I Current I FYE 2020 I FYE 2021
Increase cos 2%
5/8" $24.72 $25.02 $25.52
3/4" 33.36 33.76 34.44
1" 50.62 51.25 52.28
1.5" 93.79 94.98 96.88
2" 145.58 147.45 150.40
21/2" 206.52 208.67 212.84
3" 266.52 269.88 275.28
4" 439.10 444.79 453 .68
6" 870.76 882.05 899.69
8" 1,388.75 1,406.76 1,434.89
10" 1,993.06 2,018.92 2,059.30
30 I OCTOBER 2019 I FINAL C c~,-•1,..
Nov. 19, 2019 Item #16 Page 92 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
A p pendix A
CUSTOMER AND DEMAND FORECASTS
Forecasted customer demands for potable and recycled water are based on actual demand data provided by the District for FYE 2018. Growth
projections for all customer classes follow population data projections developed by the City of Carlsbad. Residential dwelling unit growth was used
for all customer classes except for commercial customers, which is projected based on the average growth of commercial and industrial square feet.
Growth Input 0.5% 0.7% 1.0% 0.7% 0.2% 0.1% 0.6% 0.6% 0.4% o.3% I o.3% 0.5% 0.5% 0.5% 0.4% 0.5% 0.6%
Single Famllv FYE 2019 FVE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035
5/8" 2,792,376 2,811,925 2,839,659 2,860,740 2,867,570 2,871,397 2,889,063 2,906,786 2,917,385 2,926,748 2,934,756 2,949,771 2,963,845 2,978,683 2,991,755 3,005,829 3,024,612
3/4" 268,758 270,640 273,309 275,338 2.75,996 276,364 278,064 279,770 280,790 281,691 282,462 283,907 285,262 286,690 287,948 289,303 291,111
1" 227,417 229,009 231,268 232,985 233,541 233,853 235,291 236,735 237,598 238,360 239,013 240,236 241,382 242,590 243,655 244,801 246,331
1.5" 5,728 5,768 5,825 5,868 5,882 5,890 5,926 5,962 5,984 6,003 6,020 6,050 6,079 6,110 6,137 6,165 6,204
2" 2,840 2,860 2,888 2,909 2,916 2,920 2,938 2,956 2,967 2,976 2,985 3,000 3,014 3,029 3,042 3,057 3,076
2.5"
3"
4"
6"
8"
___ l_O"
Total 3,297,118 3,320L201 3,352,949 3,377,_839 3!_~-~.905 3,3~~,424 3!_.:1_~~.282 3L432,210 3,444L725 3,455,779 3,465,235 3,482,965 3,499,582 3,517,102 3,532,537 3,549,154 3,571,334
Growth Input 0.5% 0.7% 1.0% 0.7% 0.2% 0.1% 0.6% 0.6% 0.4% o.3% I o.3% 0.5% 0.5% 0.5% 0.4% 0.5% 0.6%
Multi Family FYE 2019 FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035
5/8 49,417 49,763 50,253 50,627 50,747 50,815 51,128 51,441 51,629 51,795 51,936 52,202 52,451 52,714 52,945 53,194 53,527
3/4 21,930 22,083 22,301 22,467 22,520 22,550 22,689 22,828 22,911 22,985 23,048 23,166 23,276 23,393 23,496 23,606 23,754
1" 57,950 58,355 58,931 59,368 59,510 59,589 59,956 60,324 60,544 60,738 60,904 61,216 61,508 61,816 62,087 62,379 62,769
1.5" 178,463 179,713 181,485 182,832 183,269 183,513 184,642 185,775 186,453 187,051 187,563 188,522 189,422 190,370 191,206 192,105 193,306
2" 297,680 299,764 302,721 304,968 305,696 306,104 307,987 309,877 311,007 312,005 312,859 314,459 315,960 317,541 318,935. 320,435 322,438
2.5"
3" 44,686 44,998 45,442 45,780 45,889 45,950 46,233 46,516 46,686 46,836 46,964 47,204 47,430 47,667 47,876 48,101 48,402
4" 41,627 41,918 42,332 42,646 42,748 42,805 43,068 43,332 43,490 43,630 43,749 43,973 44,183 44,404 44,599 44,809 45,089
6" 6,962 7,011 7,080 7,133 ?,150 7,159 7,203 7,247 7,274 7,297 7,317 7,355 7,390 7,427 7,459 7,494 7,541
8"
___ 1_0·
Total 698,714 703,605 710,545 715,820 717,529 718,487 722,907 727,342 729,994 732,337 734,340 738,098 741,619 745,332 748,603 752,124 756,824
OCTOBER 2019 I FI NAL C: c;:,r~••11·
Nov. 19, 2019 Item #16 Page 96 of 158
Total
Growth Input
Commercial/
Institutional/Other
5/8
3/4
1"
1.5"
2"
2.5"
3"
4"
6'.'
8"
10"
Growth Input
Agricultural
5/8
3/4
1"
1.5"
2"
2.5"
3"
4"
6"
8"
___ l_0"
Total
Growth Input
lrrigatlon
5/8
3/4
1"
1.5"
2"
2.5"
3"
4"
6"
8"
___ 10·
Total
c:· c;:,,,,,.11,..
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
0.9% 2.1% 0.2% 0.1% 0.2% 0.5% 0.8% 1.6% 1.3% 1.3% 1.6% 1.7% 1.7% 1.2% 0.9% 1.0% 1.0%
FVE 2019 FYE 2020 FYE 2021 FVE 2022 FYE 2023 FVE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035
36,264 37,011 37,096 37,130 37,215 37,419 37,722 38,319 38,820 39,319 39,942 40,634 41,316 41,817 42,196 42,619 43,056
17,852 18,220 18,262 18,278 18,320 18,420 18,570 18,863 19,110 19,356 19,662 20,003 20,339 20,586 20,772 20,980 21,195
87,503 89,307 89,512 89,593 89,799 90,290 91,022 92,462 93,672 94,876 96,378 98,049 99,694 100,904 101,817 102,839 103,893
267,368 272,881 273,508 273,754 27~,385 275,885 278,121 282,521 286,218 289,898 294,488 299,593 304,620 308,316 311,107 314,230 317,449
691,200 705,452 707,071 707,708 709,339 713,217 718,999 730,373 739,930 749,444 761,309 774,507 787,503 797,058 804,273 812,347 820,668
34,371 35,079 35,160 35,192 35,273 35,466 35,753 36,319 36,794 37,267 37,857 38,513 39,159 39,635 39,993 40,395 40,809
43,169 44,059 44,161 44,200 44,302 44,544 44,906 45,616 46,213 46,807 47,548 48,372 49,184 49,781 50,231 50,736 51,255
867 885 887 888 890 895 902 917 929 940 955 972 988 1,000 1,009 1,019 1,030
45,252 46,185 46,291 46,333 46,439 46,693 47,072 47,817 48,442 49,065 49,842 50,706 51,557 52,182 52,655 53,183 53,728
1,223,845 1,249,080 1,251,948 1,253,074 1,255,962 1,262,829 1,273,06~ 1,293,205 1,3_10,128 1,326,972 1,347,981 1,371,350 1,394,361 1,411,279 1,424,0~~~~!~49 --!,_~?],082
0.5% 0.7% 1.0% 0.7% 0.2% 0.1% 0.6% 0.6% 0.4% 0.3% 0.3% 0.5% 0.5% 0.5% 0.4% 0.5% 0.6%
FYE 2019 FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035
736 741 748 754 756 757 761 766 769 771 773 777 781 785 788 792 797
1,171 1,179 1,191 1,200 1,202 1,204 1,211 1,219 1,223 1,227 1,231 1,237 1,243 1,249 1,254 1,260 1,268
577 581 586 591 592 593 597 600 602 604 606 609 612 615 618 621 625
4,494 4,526 4,571 4,604 4,615 4,622 4,650 4,679 4,696 4,711 4,724 4,748 4,770 4,794 4,815 4,838 4,868
26,797 26,984 27,251 27,453 27,518 27,555 27,725 27,895 27,996 28,086 28,163 28,307 28,442 28,585 28,710 28,845 29,025
52,311 52,677 53,197 53,592 53,720 53,791 54,122 54,454 54,653 54,828 54,978 55,260 55,523 55,801 56,046 56,310 56,662
86,086 86,688 87,543 88,193 88,404 88,522 89,066 89,613 89,939 90,228 90,475 90,938 91,372 91,829 92,232 92,666 93,245
0.5% I 0.7% I 1.0% 0.7% 0.2% I 0.1% 0.6% 0,6% 0.4% 0.3% I 0.3% I 0.5% I 0.5% 0.5% 0.4% 0.5% I 0.6%
m= m= m= m= m= m-m= m= m= m= m= m= m= m= m= m= m=
10,202 10,274 10,375 10,452 10,477 10,491 10,556 10,620 10,659 10,693 10,723 10,778 10,829 10,883 10,931 10,982 11,051
10,196 10,267 10,368 10,445 10,470 10,484 10,549 10,613 10,652 10,686 10,716 10,770 10,822 10,876 10,924 10,975 11,044
83,744 84,330 85,162 85,794 85,999 86,114 86,644 87,175 87,493 87,774 88,014 88,464 88,886 89,331 89,723 90,145 90,709
248,348 250,087 252,553 254,428 255,036 255,376 256,947 258,524 259,466 260,299 261,011 262,347 263,598 264,918 266,081 267,332 269,003
413,472 416,367 420,474 423,595 424,606 425,173 427,789 430,413 431,983 433,369 434,555 436,778 438,862 441,059 442,995 445,079 447,860
47,052 47,381 47,849 48,204 48,319 48,383 48,681 48,980 49,158 49,316 49,451 49,704 49,941 50,191 50,411 50,649 50,965
10,890 10,966 11,075 11,157 11,184 11,198 11,267 11,336 11,378 11,414 11,446 11,504 11,559 11,617 11,668 11,723 11,796
823,905 82~,673 _ --837,856 844,076 846,091 847,220 852,433 857,662 860,789 _!_6~.~~2 ~~5,915 870,345 874,497 878,876 882,733 886,885 892,427
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 97 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Growth Input 0.5% 0.7% 1.0% 0.7% 0.2% 0.1% 0.6% 0.6% 0.4% 0.3% 0.3% 0.5% 0.5% 0.5% 0.4% 0.5% 0.6%
Recycled Water FYE 2019 •];·-:·.•f'Ye 202{) FYE 2021-, . ~FYE 2022·· FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FVE 2033 FYE 2034 FYE io3S, ·.i
5/8
3/4
1"
1.5"
2"
2.5"
3"
4"
6"
8"
10"
541
4,888
152,422
528,828
650,176
31,722
39,594
199,325
121,924
Total 1,729,421
OCTOBER 2019 I FINAL
545 550
4,922 4,971
153,489 155,003
532,531 _ 537,783
654,728 661,186
31,944 32,259
39,871 40,265
200,720 202,700
122,777 123,988
1,741!.529 1,758,705
554 556 556
5,008 5,020 5,026
156,154 156,526 156,735
541,775 543,069 543,794
666,094 667,685 668,576
32,499 32,577 32,620
40,564 40,660 40,715
204,205 204,692 204,966
124,909 125,207 125,374
1,771,761 1,775,992 1,718,362
560 563 565 567 569 571 574 577 580 582 586
5,057 5,088 5,107 5,123 5,137 5,164 5,188 5,214 5,237 5,262 5,295
157,700 158,667 159,246 159,757 160,194 161,013 161,782 162,592 163,305 164,073 165,099
547,139 550,496 552,503 554,276 555,793 558,636 561,302 564,112 566,588 569,253 572,810
672,689 676,816 679,284 681,464 683,328 686,824 690,101 693,556 696,600 699,877 704,250
32,821 33,022 33,142 33,249 33,340 33,510 33,670 33,839 33,987 34,147 34,361
40,965 41,216 41,367 41,499 41,613 41,826 42,025 42,236 42,421 42,621 42,887
206,227 207,492 208,248 208,917 209,488 210,560 211,565 212,624 213,557 214,561 215,902
126,145 126,919 127,382 127,791 128,141 128,796 129,411 130,059 130,629 131,244 132,064
1,71J9,30~--_ 1,800,280 1,806_,844 1,~1~_,643 1!817,602 1,826,902 1,835,618 1,844,808 1,852,904 1,861,620 1,873,254
<:::: c a r,,,.••#9•
Nov. 19, 2019 Item #16 Page 98 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix C
CAPITAL IMPROVEMENT PLAN
Water Connection Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include
✓
✓
✓
✓
✓
✓
✓
Project Title
College Boulevard -Cannon Road to Badger Lane (375 Zone)
College Boulevard -Cannon Road to Badger Lane (490 Zone)
Desalinated Water Flow Control Facility
Poinsettia Lane -Cassia Road to Skimmer Court
Rancho Carlsbad Groundwater Supply
San Luis Rey Mission Basin Groundwater Supply
Water Modeling
Total Water Connection Prolects
OCTOBER 2019 I FINAL
800,000
300,000
S0,000
300,000
$1,450,000
35,000
370,000
6,000,000
1,432,000
300,000 300,000
$0 $6,300,000 $1,837,000 $300,000
c · c;:,rr••,..
Nov. 19, 2019 Item #16 Page 102 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Water Replacement Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
Project Title
ABANDON POTABLE SERVICES (NEW RECYCLED SERVICES)
AVIARA PARKWAY AND PLUM TREE WATERLINE
CARLSBAD BOULEVARD WATERLINE REPLACEMENT AT TERRA MAR
CAR.LSBAD WATER RECYCLING FACILITY (ENCINA CAPITAL PROJECTS)
CATHODIC PROTECTION PROGRAM
CRESTVIEW DRIVE TRANSMISSION MAIN
EL FUERTE AND CORINTIA STREET PRESSURE REDUCING STATION
FIRE FLOW SYSTEM IMPROVEMENTS
HYDROELECTRIC GENERATOR AT DESAL FLOW CONTROL FACILITY NO. 5
LIMITED ACCESS PIPELINE RELOCATION PROGRAM
MAERKLE FACILITY IMPROVEMENTS
MAERKLE RESERVOIR FLOATING COVER REPLACEMENT
MAERKLE RESERVOIR TRANSMISSION MAIN
MISCELLANEOUS PIPELINE REPLACEMENTS
NORMALLY CLOSED VALVE (INSTALL MOTORIZED VALVE)
ORION CENTER
PALOMAR AIRPORT WATERLINE REALIGNMENT
PRESSURE REDUCING STATION PROGRAM
RANCHO CARLSBAD GROUNDWATER SUPPLY
RECYCLED WATER LINE -CWRF TO AGUA HEDIONDA LAGOON
RECYCLED WATER PHASE 3 -CWRF EXPANSION
RECYCLED WATER PHASE 3 -PIPELINES
RECYCLED WATER PHASE 3 -RESERVOIR
RESERVOIR REPAIR AND MAINTENANCE PROGRAM
SAN DIEGUITO WATER INTERTIE AND PIPELINE EXTENSION
SAN LUIS REY MISSION BASIN GROUNDWATER SUPPLY
SANTA FE II INLET PIPELINE
SANTA FE II RESERVOIR SITE ELECTRICAL IMPROVEMENTS
SCADA IMPROVEMENTS
SIDEWALK/STREET CONSTRUCTION -VALLEY STREET MAGNOLIA AVENUE
TRI-AGENCY WATER TRANSMISSION PIPELINE REPLACEMENT
WATER CONDITION ASSESSMENT PROGRAM
WATER LOSS MONITORING
WATER VALVE REPAIR/REPLACEMENT PROGRAM
WATER, RECYCLED, AND SEWER MASTER PLAN
SCADA IMPLEMENTATION
Total Water Rep_lacement Projects
c · car-11--.·
$ 850,000 $
500,000
180,000
90,000
200,000
100,000
3,320,000
225,000
600,000
200,000
50,000
25,000
350,000
390,000
100,000
890,000
50,000
174,750
$8,120,000
$ $ $
100,000 1,000,500
2,500,000 150,000
180,000 190,000 190,000 190,000
800,000
390,000 390,000 390,000 390,000
2,075,000
2,000,000 1,000,000
1,000,000 8,301,000
1,530,000 1,730,000 2,690,000 2,800,000
600,000 600,000 600,000 600,000
1,000,000 1,960,000
2,370,000
400,000 410,000 410,000 420,000
100,000 100,000 100,000 100,000
910,000 930,000 940,000 %0,000
25,000
897,046 3,144,481 3,486,084 2,479,194
$6,135,000 $8,950,000 $12,715,500 $15,721,000
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 103 of 158
CARLSBAD J POTABLE, RECYCLED, AND WASTEWATER RATE STUDY J Water Cost of Service Study
Recycled Water Connection Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include
~
Total Prolects
Project Title
RECYCLED WATER LINE -CWRF TO AGUA HEDIONDA LAGOON
RECYCLED WATER PHASE 3 -PIPELINES
RECYCLED WATER PHASE 3 -CWRF EXPANSION
RECYCLED WATER PHASE 3 -RESERVOIR
$0 $0 $0 $0 $0
Recycled Water Replacement Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include Project Title
✓ CARLSBAD WATER RECYCLING FACILITY (ENCINA CAPITAL PROJECTS) $ 202,800 $ 207,000 $ 211,000 $ 215,000 $ 219,000
✓ CATHODIC PROTECTION PROGRAM $ 20,000 $ 20,000 $ 20,000 $ 20,000 $ 20,000
✓ CWRF IRRIGATION AND LANDSCAPE ---
✓ MISCELLANEOUS PIPELINE REPLACEMENTS -250,000 350,000
✓ ORION CENTER -----I ✓ RECYCLED WATER CONDITION ASSESSMENT PROGRAM 50,000 50,000 50,000 50,000 50,000
✓ RECYCLED WATER VALVE & APPURTENANCE REPLACEMENT PROGRAM 110,000 110,000 110,000 120,000 120,000
✓ SCADA IMPROVEMENTS 150,000 ---
✓ WATER, RECYCLED, AND SEWER MASTER PLAN 25,000 25,000 ---
✓ SCADA IMPLEMENTATION 309,677 589,141 710,795 233,285 303,709
Total Prolects $867,477 $1,001,141 $1,101,795 $888,285 $1,062,709
Total CIP Project Summary FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Total CIP (FY 2019-2040)
R&R 85% $ 6,412,227 $ 6,658,187 $ 13,196,276 $ 17,089,869 $ 19,262,903
Expansion 15% 4,750,000 1,650,000 6,300,000 1,837,000 300,000
Total CIP $ 11,162,227 $ 8,308,187 $ 19,496,276 $ 18,926,869 $ 19,562,903
Total 5-Year CIP (FY 2019-2023)
R&R 75% $ 6,412,227 $ 6,891,223 $ 14,136,181 $ 18,947,843 $ 22,104,624
Expansion 25% 4,750,000 1,707,750 6,748,718 2,036,715 344,257
Total S-Year CIP $ 11,162,227 $ 8,598,973 $ 20,884,898 $ 20,984,558 $ 22,448,881
OCTOBER 2019 I FINAL <::. ca,,.~••11·
Nov. 19, 2019 Item #16 Page 104 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Multi-Family Residential (MFR) Customer Service Fire Base Max Day Max Hour SDCWA Desai -Allocated 2020 Revenue Requirement $ 103,111 $ 1,053,417 $ $ 428,139 $ 149,1S2 $ 87,382 $ 1,906,594 $ 314,641 $ 4,042,436
Recovered through Account Charges 100%
Number of Accou nts (FY 2021) I 1,142 I
Monthl~ Fixed Charge Per Account $ 7.52 $ ___ $_ $ $ $ $ $ $ 7.52
Recovered through Unit Charges I I 100% I 100%
Effective Number of MEUs (FY 2021) I 5,0191
Monthly Fixed Charge Per MEU $ $ 17.49 $ $ $ $ $ $ $ 17.49
Recovered through Volume Charges I I I I 100% I 100% I 100% I 100% I 100%
Peaking Allocations I 87% I 13% I 13% I
Tier Limits (ccf/DU) U1212erlimit
Tier 1 0 I 5 All Tiers (eel) 615,126 88,480 88,480 647,705 55,900 TRUE
Tier2 6 I 10 Tier 1 547,586 547,586
Tier3 11 I 999999 Tie r2 67,540 88,480 100,119 I 55,900
Tier3
Tier Usage % eel Tier Peak Factor
Tier 1 I 78% I 547,586 1.04 Tier 1 77.8% 72.2% 72.2% 84.5% 0.0%
Tier2 I 22% I 156,019 1.41 Tier2 22.2% 27.8% 27.8% 15.5% 100.0%
Tier3 I I 1.55 Tier3 0.0% Q.0% 0.0% 0.0% 0.0%
Total MFR Usage 100% 703,605 703,605 TRUE TRUE TRUE TRUE TRUE
Volume Charge ($/eel) $ 0.61 $ 0.21 $ 0.12 $ 2.71 $ 0.45
Tier Volume Charge per ccf: Rounded Rates
Tierl $ 0.61 $ 0.20 $ 0.12 $ 2.94 $ $ 3.87
Tier2 $ 0.61 $ 0.27 $ 0.16 $ 1.89 $ 2.02 .l 4.94
Tier3 $
Commercial Customer Service Fire Base Ma>< Day Max Hour SOCWA Desai -Allocated 2020 Revenue Requirement $ 153,971 $ 1,760,Sn $ $ 760,056 $ 335,865_ $ 196,769 $ 3,279,304 $ 760,084 $ 7,246,926
Recovered through Account Charges I 100% I I I
Number of Accounts (FY 2021) I 1,7061
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ $ $ $ $ 7.52
Recovered through Unit Charges I 100% I 100%
Effective Number of MEUs (FY 2021) I 8,390 I
Monthly Fixed Charge Per MEU $ $ 17.49 $ $ $ $ $ $ $ 17.49
Recovered through Volume Charges I I I I 100% I 100% I 100% I 100% I 100%
Projected Billed Water Usage (eel) 1,249,0801 Rounded Rates
Volume Charge ($/ccf) $ $ $ $ 0.61 $ 0.27 $ 0.16 $ 2.63 $ 0.61 $ 4.27
OCTOBER 2019 I FINAL c · c;,r-••#J·
Nov. 19, 2019 Item #16 Page 122 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Agricultural Customer Service Fire Base Max Day Max Hour SDCWA Desai -Allocated 2020 Revenue Requirement $ 1,964 $ 57,193 $ $ 52,749 s 22,682 s 13,288 s 193,364 s 118,195 s 459,435 --,-------,-------,------,----,----,-------,-------,---
Percent Recovered Through Account Charges 100%
Number of Accounts 221
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ $ $ $ .1 7.52
Recovered through Unit Charges I I 100% I 100%
Effective Number of MEUs (FY 2021) ml
Monthly Fixed Charge Per MEU $ $ 17.49 $ $ $ $ $ $ .1 17.49
Recovered through Volume Charges I I I I 100% I 100% I 100% I 100% I 100%
Projected Billed Water Usage (ccf) I 86,6881 Rounded Rates
Volume Charge ($/ccf) _ $ $ $ $ 0.61 $ 0.26 $ 0.15 $ 2.23 $ 1.36 $ 4.62
Irrigation Customer Service Fire Base Max Day Max Hour SDCWA Desai -Allocated 2020 Revenue Requirement $ 75,667 $ 948,753 $ $ 504,850 $ 387,903 $ 227,2S6 $ 1,524,162 $ 1,755,489 $ 5,424,080
Percent Recovered Through Account Charges 100%
Number of Accounts I 838 I
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ $ $ $ $ 7.S2
Recovered through Unit Charges [ I 100% I 100%
Effective Number of MEUs (FY 2021) I 4,s20 I
Monthly Fixed Charge Per MEU $ $ 17.49 $ $ $ $ $ $ $ 17.49
Recovered through Volume Charges I I I I 100% I 100% I 100% I 100% I 100%
Projected Billed Water Usage (ccf) I 829,6731 Rounded Rates
Volume Charge ($/ccf) $ $ $ $ 0.61 $ 0.47 $ 0.27 $ 1.84 $ 2.12 $ 5.31
Fire Customer Service Fire Base Max Day Max Hour SDCWA Desai -Allocated 2020 Revenue Requirement $ 188,577 188,577
Percent Recovered Through Account Charges I I I 38%
Number of Accounts I 182.00 I
Monthly Fixed Charge Per Account $ 7.52 $ 7.52
Recovered through Unit Charges I I I 63%
Effective Number of MEUs (FY 2021) I 40,3651 Rounded Rates
Monthly Fixed Charge Per MEU $ 0.24 $ 0.25
c::: c::,,-"'l· FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 123 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix J
SUPPLY ALLOCATION
Supply Allocation SDCWA Desai Total
Total Available for Retail (ccf) 5,100,248 1,089,000 6,189,248
Annualized Month Minimum Use
Remaining Available Before Allocation 5,100,248 1,089,000 6,189,248
Amount to be Allocated 4,822,916 4,822,916
Allocated Min. 3 Month Remaining
Single Family 2,611,096 2,611,096 2,611,096 2,611,096
Multi-Family 633,469 633,469 633,469 633,469
Commercial/Non-Residential 1,079,650 1,079,650 1,079,650 1,079,650
Agricultural 60,342 60,342 60,342 60,342
Irrigation 438,359 438,359 438,359 438,359
Total (ccf) 4,822,916 4,822,916 4,822,916 4,822,916
Remaining to Allocate 277,332 1,089,000 1,366,332
Annualized Average Use
Remaining Available Before Allocation 277,332 1,089,000 1,366,332
Amount to be Allocated 277,332 1,089,000 1,366,332
Less Previously
Allocated Average Month Allocated· Remaining
Single Family 3,320,201 (2,611,096} 709,105 143,931 565,174 709,105
Multi-Family 703,605 (633,469} 70,136 14,236 SS,900 70,136
Com me rcia 1/N o n-Residentia I 1,249,080 (1,079,650) 169,430 34,390 135,039 169,430
Agricultural 86,688 (60,342} 26,347 5,348 20,999 26,347
Irrigation 829,673 (438,359) 391,314 79,427 311,887 391,314
Total (ccf) 6,189,248 (4,822,916} 1,366,332 277,332 1,089,000 1,366,332
Remainin_g_ to Allocate
OCTOBER 2019 I FINAL C c~r~••11t·
Nov. 19, 2019 Item #16 Page 124 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Total Supply Allocation SDCWA Desai Total
Single Family Single Family 2,755,027 565,174 3,320,201
Multi-Family Multi-Family 647,705 55,900 703,605
Co mmercia 1/N o n-Residentia I Co mmercia 1/N on-Reside ntia I 1,114,040 135,039 1,249,080
Agricultural Agricultura I 65,689 20,999 86,688
Irrigation Irrigation 517,786 311,887 829,673
Total (ccf) 5,100,248 1,089,000 6,189,248
Check: 5,100,248 1,089,000 6,189,248
Single Family 54% 52% 106%
Multi-Family 13% 5% 18%
Co mmercia 1/N o n-Residentia I 22% 12% 34%
Agricultural 1.3% 1.9% 3%
Irrigation 10.2% 28.6% 39%
100% 100% 200%
C c:ilr-••~, FINAL I OCTOBER 2619
Nov. 19, 2019 Item #16 Page 125 of 158
Exhibit 7
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/\II Receive -AgendJ Item ti \ IP
For the Inform; · , ;n of the:
CITY COL ., tl.
Date \\ \ \~ CA )0 CC ._¥2
CM _1coo ...p DCM (3) ~;_------,
Office of the Cit~y Clerk RECEIVED
City of Carlsbadli NOV l & 20,9
t200 Carr sbad Viffage Dr.
C I b d CA 912008 CITY OF CARLSBAD ar s a , ' CITY CLERK'S OFFICE
Dear City Clerk,
r protest the pro,posed TTer t sfngre famffy rate that rs currentry
at $3.94/unit proposed TO $4.04/unit effective 1/1/2020 as well
the proposed 1() $4.21/unit effect"1ve 1n12021.
1t.Jry-name 1s J 1acque~ne Simon and i rrve at
, Carlsbad, C~A 92011. Parcel#
Parcef #
Nov. 19, 2019 Item #16 Page 157 of 158
P-ecei ved \ \--\Cf-\~
W-~ R-e,Wrd.
Reclaimed water inequality in
city of Carlsbad
My concern is the lack of progress being made to bring reclaimed
water to all the citizens of
Carlsbad. I have lived in the Alicante Hills HOA for five years now, and
our biggest expense is our
water bill. By not having the reclaimed water and the benefits of the
cheaper rates we lose roughly
$10,000 dollars per year, $50,000 in the five years I have lived here. Why
have my tax dollars gone
to benefit some areas that enjoy the cheaper rates while others are paying
the high costs of non reclaimed
water rates. You don't treat other city services such as fire,
police,gas,and electric that way,providing
for some and not for others. I propose that all citizens should be given
the benefits of the reclaimed water
rates or none do, why should some benefit with the savings provided by our
tax dollars and others do not.
If the city had made constant progress to provide for all you could justify
the wait,but this is not the case
I propose that by charging those who have the reclaimed water benefits the
same amount that those who do not,
the excess profits could be used to bring the reclaimed water to all, and
then allow everyone to reap the
benefits of the reclaimed water rates, or start giving those who have
helped fund the advantages of the
reclaimed water the same low rate.
Respectfuly, Dave Allen
Carlsbad, CA
Nov. 19, 2019 Item #16 Page 158 of 158
Nov. 19,2019
All Receive -Agenda Item# .l!f .
For the Information of the:
Cllv' COUNCIL
Pate ~ CA ~ cc "i!._
CM ~ COO ~ DCM (3) *
Council Memorandum
To: City Council and Carlsbad Municipal Water District Board
From: Vicki Quiram, Utilities Director/General Manager
Via: Paz Gomez, Deputy City Manager, Public Works
{city of
Carlsbad
Re: Additional Materials for the Nov. 19, 2019 Council Meeting Regarding Staff
Report Item No. 16 -Public Hearing for approval of a potable water rate
structure modification and proposed two-year rates for potable water, recycled
water and wastewater.
This memorandum provides additional materials for the Nov. 19, 2019 Joint City Council and
Carlsbad Municipal Water District Board Meeting related to Agenda Item No. 16, Exhibit 3,
regarding holding a public hearing for water rates. The information in the published materials
overstate the current and proposed monthly recycled water delivery charge rates.
In Exhibit 3, the published materials state the current and proposed monthly recycled water
delivery charge rates are:
Monthly Recycled Water Delivery Charge
Two Year Rates
1/1/2020
Current Proposed
Meter Size:
5/8" $ 23.69 $ 23.69
3/4" $ 32.69 $ 32.69
1" $ 50.70 $ 50.70
1.5" $ 95 .73 $ 95.73
2" $ 149.75 $ 149.75
2.5" $ 212.84 $ 212.84
3" $ 275.90 $ 275.90
4" $ 455.93 $ 455.93
6" $ 906.18 $ 906.18
8" $1,446.47 $1,446.47
10" $2,076.82 $ 2,076.82
Joint Carlsbad Municipal Water District/ Utilities Department
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 t
1/1/2021
Proposed
$ 23.69
$ 32 .69
$ 50.70
$ 95 .73
$ 149.75
$ 212.84
$ 275.90
$ 455.93
$ 906.18
$ 1,446.47
$ 2,076 .82
Carlsbad Municipal Water District Board
Nov. 19,2019
Page 2
Exhibit 3 should state the current and proposed monthly recycled water delivery charge rates
are:
Monthly Recycled Water Delivery Charge
Two Vear Rates
1/1/2020 1/1/2021
Current Proposed Proposed
Meter Size:
5/8" $ 23.34 $ 23.34 $ 23.34
3/4" $ 32.22 $ 32.22 $ 32.22
1" $ 49.97 $ 49.97 $ 49.-97
1.5" $ 94.35 $ 94.35 $ 94.35
2" $147.59 $ 147.59 $ 147.59
2.5" $ 209.77 $ 209.77 $ 209.77
3" $ 271.92 $ 271.92 $ 271.92
4" $ 449.35 $ 449.35 $ 449.35
6" $ 893.11 $ 893.11 $ 893.11
8" $1,425.61 $1,425.61 $1,425.61
10" $2,046.87 $2,046.87 $2,046.87
As the cost of service study did not rely on the overstated rates, the error did not affect the cost
of service study results. Therefore, staff continues to recommend there be no increase in
recycled water rates for calendar years 2020 and 2021.
cc: Scott Chadwick, City Manager
Elaine Lu key, Chief Operations Officer
Celia Brewer, City Attorney
Public Hearing for
CY2020 & 2021 Utilities Rates
Vicki Quiram, Utilities Director
Ligeia Heagy, Utilities Department
November 19, 2019
Requested Action
•Adopt the proposed calendar year 2020 and
2021 utilities rates.
2
California Proposition 218
•Overview –Majority Protest Public Hearing
•Schedule
–Sep. 17, 2019: Set the majority-protest public hearing date for Nov. 19, 2019
–Oct. 1, 2019: Mailed the Notice of Hearing (minimum 45 days ahead of
public hearing)
–Nov. 19, 2019: Hold majority-protest public hearing, set rates
–Jan. 1, 2020: Implement new rates
•Protest process
3
Utilities Cost of Service Study
•Carollo Engineers, Inc.
•Objectives:
–Ensures charges are aligned with the cost of
providing services
–Comply with Prop 218, state constitution, and
legal requirements
4
Potable Water Revenue
5
•No rate increase for last two years
•Revenue increase of
–1% for CY2020, and
–2% for CY2021
•Increase primarily driven by:
–SDCWA and MWD increases –cost of water (55%)
–SDCWA capital improvement program
–Demand changes
Potable Water –Rates
6
Potable Water -Single Family 5/8ths Meter -Delivery Charge History
$30.00
$24.72 $24.72 $25.02 $25.52
$25.00 $24.11
$21.08 $22.19
$20.07
Q) $20.00 ~
(11 ..c. u c:-$15.00
Q) -~
Q)
Cl $10.00
$5.00
$0.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Water Rate Comparison –Single Family Residential
7
Regional Monthly SFR Water Bill
$140
$120
$100
i:i5 $80 $68.81 1 $6~.84
> J: 'E $60 0 ~
$40
$20
$-
-Fixed Charge
-Commodity Charge
- -Regional Average
Recycled Water Revenue and Rates
8
•No revenue increase recommended
•No rate increases proposed
Recycled Water –Rate History and Value
9
$6.00
$5.00
~ $4.00
ro a:::
.!::! ~ $3.00
E ::::,
0 > $2.00
$1.00
$-
Volumetric Charge -Recycled Water Rate vs. Potable Irrigation Rate
$4.15 $4.22
$3.85 .............. . S?.,50... ...... ··· · · $3.53
$3.27
2011 2012 2013 2014
Recycled Water Rate -Potable Irrigation Rate
$4.44
2015
$4.67
2016
Calendar Year
$5.03
2017
•····· Linear (Recycled Water Rate)
$5.16 $5.16 ················· ··········
$5.41 $5.31 ......... ··············
$3.79 $3.79
2018 2019 2020 2021
......... Linear (Potable Irrigation Rate)
Wastewater Revenue
10
•No increases for the last 4 years
•Revenue increase
–3% for CY2020
–3% for CY2021
•Increased costs associated with Encina Wastewater Authority
–CalPers pension obligation -100% pay-off over 3 years ($4.1M)
–Capital Improvement Program ($95M –over the next 10 yrs)
•Inflation (chemicals and energy)
•Wastewater CIP (asset management plan & SCADA)
Wastewater –Historical Rates
11
Wastewater -Single Family Fixed Monthly Charge
$30.00 $29.52
$29.00
Q) ~ $28.00
..c u
~ $27.00 ..c
+-' C: $26.03
0 $26.00 $25.52 ~
"C Q) $25.00 -~ LI..
$24.00
$23.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Wastewater Rate Comparison –Single Family Residential
12
Regional Monthly SFR Wastewater Bill
$160
$140
iii $120
> :c $100 E 0
~ $80
$60 - - - - - - - - - - - - - - - -
$40 1J 1E111 II IIII $20
$-
-Commodity Charge
Example of Monthly Bill Changes
13
Current Bill Proposed Bill
(Jan. 1, 2020)
Proposed Bill
(Jan. 1, 2021)
Potable Water $68.81 $69.84 $71.33
Wastewater $27.81 $28.66 $29.52
Total SF Residential $96.62 $98.50 $100.85
What does one gal of water cost for the average residential customer?
Less than one
Penny!
What Can Buy You?
14
9 i 257 gal Ions
~ J 39 gal Ions ~1 ~~j -
15 gallons
7 gallons
3 gallons
Requested Action
15
•Adopt the proposed CY2020 & CY2021
utilities rates.
The Following is the previous presentation –in
case we need to refer to one of the slides
during the question period
16
Public Hearing for
CY2020 & 2021 Utilities Rates
Vicki Quiram, Utilities Director
Ligeia Heagy, Utilities Department
September 17, 2019
Requested Action
•Set the date for a public hearing on the
proposed CY2020 & CY2021 utilities rates.
18
California Proposition 218
•Overview –Majority Protest Public Hearing
•Schedule
–Sep. 17, 2019: Set the majority-protest public hearing date for Nov. 19, 2019
–Oct. 1, 2019: Mailed the Notice of Hearing (minimum 45 days ahead of
public hearing)
–Nov. 19, 2019: Hold majority-protest public hearing, set rates
–Jan. 1, 2020: Implement new rates
•Protest process
19
Utilities Cost of Service Study
•Carollo Engineers, Inc.
•Objectives:
–Comply with Prop 218, state constitution, and
legal requirements
–Update data on current customer usage demands
–Ensure sufficient funding for operations
20
Utilities Cost of Service Study
•Process
–Revenue Requirement
–Functional Allocation
–Customer Class Allocation
–Rate Design
21
Customer Classes
Potable Water Wastewater
Single Family Single Family
Multi-family Multi-family
Non-Residential Commercial
Commercial Schools
Agriculture
Irrigation
Customer Classes - Examples
22
Utilities Cost of Service Study
23
Results
•Rebalances rates to account for shifting demand between classes
•Potable rate structure revision to mirror usage patterns
-Proposed Tier 3 deletion for multi-family residential (<5%)
•Reserve Policy for each utility: target of 40% of operating budget
Potable Water Revenue
24
•Revenue increase of 1% for CY2020, and 2% for CY2021
•Increase primarily driven by:
–Demand pattern shifts between customer classes
–SDCWA and MWD increases –cost of water
–SDCWA capital improvement program
SDCWA Demand Forecast
25
Historical & Forecasted Water Sales
700
600
..., 500
l
~ 400 ~
"O ~ 300 ~ 0 .,:;;;;
I-200
100
0
Revenue Impact:
• In 2008 $1 /AF = $620 ,000
• In 2015, $1 /AF = $500,000
• In 2019, $1 /AF =$395,000
56% increase ($1. 56/ AF) to generate
2008 levels ($620,000)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Fiscal Year
■ Forecasted Deliveries
4
SDCWA Cost Breakdown
26
Recommended CY 2020 Cost of Water Breakdown
$1,800
$1,600
$1 ,400
$1,200
u.. $1,000 ~
Vl-$800
$600
$400
$200
s-
■ Transportation •
■ Supply Reliability •
Storage•
■ Customer Service •
■ Melded Mf:t l Treatment Rate
■ Melded Mf:t l Supply Rate
Untreated Water Cost
Approved
CY 2019
$120.00
$80.00
$171.00
$61.00
$276.00
$909.00
$1,341.00
$1,617.00
Preliminary St. %.C. CY 2020
$132.00 $12.00 10.0%
$104.00 $24.00 30.0%
$181.00 $10.00 5.8%
$64.00 $3.00 4.9%
$280.00 $4.00 1.4%
$925.00 $16.00 1.8%
$1,406.00 $65.00 4.8%
$1,686.00 $69.00 4.3%
10
Potable Water –where does the money go?
27
Other Financing Uses
4%
Personnel
7%
M & 0 & Capital Outlay
12%
FY 2020 Expenses
Depreciation]
7%
MWD/CWA Fixed charges
11%
Water Purchases
44%
• Water Purchases • MWD/CWA Fixed charges • M & 0 & Capital Outlay Personnel • Other Financing Uses • CIP • Depreciation
Potable Water –Rates
28
Potable Water -Single Family 5/8ths Meter -Delivery Charge History
$30.00
$24.72 $24.72 $25.02 $25.52
$25.00 $24.11
$21.08 $22.19
$20.07
Q) $20.00 ~
(11 ..c. u c:-$15.00
Q) -~
Q)
Cl $10.00
$5.00
$0.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Water Rate Comparison –Single Family Residential
29
Regional Monthly SFR Water Bill
$140
$120
$100
i:i5 $80 $68.81 1 $6~.84
> J: 'E $60 0 ~
$40
$20
$-
-Fixed Charge
-Commodity Charge
- -Regional Average
Recycled Water Revenue and Rates
30
Good news!
•No revenue increase recommended
•No rate increases proposed
Recycled Water –where does the money go?
31
FY 2020 Expenses
• Water Purchases • M & O & Capital Outlay • Personnel • Debt Service • Encina Services • CIP • Depreciation
Recycled Water –Rate History and Value
32
$6.00
$5.00
~ $4.00
ro a:::
.!::! ~ $3.00
E ::::,
0 > $2.00
$1.00
$-
Volumetric Charge -Recycled Water Rate vs. Potable Irrigation Rate
$4.15 $4.22
$3.85 .............. . S?.,50... ...... ··· · · $3.53
$3.27
2011 2012 2013 2014
Recycled Water Rate -Potable Irrigation Rate
$4.44
2015
$4.67
2016
Calendar Year
$5.03
2017
•····· Linear (Recycled Water Rate)
$5.16 $5.16 ················· ··········
$5.41 $5.31 ......... ··············
$3.79 $3.79
2018 2019 2020 2021
......... Linear (Potable Irrigation Rate)
Wastewater Revenue
33
•Revenue increase of 3% for CY2020, and 3% for CY2021
•Increased costs associated with Encina Wastewater Authority
–CalPers pension obligation -100% pay-off over 3 years ($4.1M)
–Capital Improvement Program ($95M –over the next 10 yrs)
•Inflation (chemicals and energy)
•Wastewater CIP (asset management plan & SCADA)
Wastewater –where does the money go?
34
M & O & Capital Outlay I
19%
M & O & Capital outlay • Personnel • Other Financi111 Uses • Encina Services • Encina CIP • CIP Depreciation
Person-;;;il
6%_j
Wastewater –Historical Rates
35
Wastewater -Single Family Fixed Monthly Charge
$30.00 $29.52
$29.00 $28.66
OJ ~ $28.00 $27.81 $27.81 $27.81 $27.81
.s::. u ~ $27.00 .s::. ... $26.03 C
~ $26.00 $25.52
"C
-~ $25.00
LI..
$24.00
$23.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
Wastewater - Breweries
36
Breweries FY 2020 FY 2021
B1 – Brewery without a restaurant
and hauls waste for outside treatment $2.80 $2.88
B2 – Brewery without a restaurant
that does not haul waste for outside
treatment
$9.07 $9.34
B3 – Brewery with a restaurant and
hauls waste for outside treatment $7.87 $8.10
B4 – Brewery with a restaurant that
does not haul waste for outside
treatment
$11.26 $11.60
PROPOSED
2019 Wastewater Rate Comparison –Single Family Residential
37
Regional Monthly SFR Wastewater Bill
$160
$140
iii $120
> :c $100 E 0
~ $80
$60 - - - - - - - - - - - - - - - -
$40 1J 1E111 II IIII $20
$-
-Commodity Charge
Example of Monthly Bill Changes
38
Current Bill Proposed Bill
(Jan. 1, 2020)
Proposed Bill
(Jan. 1, 2021)
Potable Water1a $68.81 $70.55 $72.42
Wastewater1b $27.81 $28.66 $29.52
Total SF Residential $96.62 $99.21 $101.94
Requested Action
39
•Approve the proposed CY2020 & CY2021
utilities rates.