Loading...
HomeMy WebLinkAbout1995-03-07; Municipal Water District; 273; Readiness-to-Serve & New Demand ChargeCARLSBAD lk-KIPAL WATER DISTRICT - -3ENDA BILL AB # a-7 2 MTG .03/07/95 DEPT CMWD . ,r ’ TITLE: PROPOSED COUNTY WATER DEPT. HD. AUTHORITY READINESS-TO-SERVE ?zi@ CITY ATTY AND NEW DEMAND CHARGES CITY MGf3.a RECOMMENDED ACTION: This is an informational item to be discussed by the Board. This item will be considered at the March 9, 1995 County Water Authority Board meeting. ITEM EXPLANATION: On Thursday, March 9, 1995 the San Diego County Water Authority will hold a public hearing to adopt the new Metropolitan Water District (MWD) rates and charges. Attached are copies of the resolution acted on at the recent County Water Authority (CWA) February 9, 1995 meeting. As noted in these resolutions the CWA intends to pass through to its member agencies subsequent to the March 9th public hearings a readiness-to-serve charge and a new demand charge. Included in the readiness-to-serve charge resolution is language requesting MWD to collect a standby charge within the CWA service area as a credit against the CWA readiness-to-serve obligation. The CWA will be considering the pass-through of MWD’s readiness-to-serve and new demand charges according to the same allocation methodology and formulas of MWD. This includes allocating the historical water purchases from CWA with an offsetting credit for an agency’s standby charge collections by MWD, and the imposition of a new demand charge ~ when a member agency goes above its established base demand. The new demand charge base for each member agency is detailed in the resolution of intent as is the anticipated readiness-to-serve charge to be levied upon each member agency. The readiness-to-serve charge levied by MWD upon the Authority is $14666,336 in fiscal year 1996. This charge is to be offset with estimated standby charge collections of $12,364,000 for a net readiness-to-serve charge to be collected of $2563,336. 2 0 6 a % LYE-J * $14 Mllion m L Any demands incurred above the base established for the new demand charge will pay a one- time charge of $1,000 per acre foot to be financed at the option of the ‘member agency over a period of 15 years. FISCAL IMPACT: There is no immediate fiscal impact from this informational item. However, adoption of the new rates and charges by the County Water Authority will result in those new charges being passed on to Carlsbad Municipal Water District. These new rates and charges will, in turn, be passed on to Carlsbad Municipal Water District customers through increased water rates. It is anticipated that the new demand charges from the CWA will not be imposed for several years since Carlsbad Municipal Water District present water deliveries are well below the new demand base figure set by CWA. EXHIBITS: 1. 2. 3. 4. 5. 6. San Diego County Water Authority Resolution No. 95-9 giving notice of intention to impose new demand charge. San Diego County Water Authority Resolution No. 95-10 giving notice of intention to impose readiness-to-serve charge. Readiness-to-Serve Charge FY 95-96 Chart Readiness-to-Serve Charge Payment Schedule MWD Member Agency Demands and Charges Copies of Slides for Presentation , EXHIBIT 1 RESOLUTION NO. 95-9 RESOLUTION OF THE BOARD OF DIRECTORS OF THE SAN DIEGO COUNTY WATER AUTHORITY GIVING NOTICE OF INTENTION TO IMPOSE NEW DEMAND CHARGE WHEREAS, at its meeting of' January 10, 1995, the Board of Directors of-the MetropolitanWater District of Southern California ("Metropolitan") adopted Resolution 8465 giving notice of intention to impose a new demand charge on its member agencies. The resolution is on file with the Executive Secretary and is incorporated herein by reference; WHEREAS, the new demand charge is intended to recover the debt service of expenditures by Metropolitan for projects needed to satisfy anticipated new demands on Metropolitan; WHEREAS, the "Nexus Study in Support of Metropolitan's New Demand Charge" dated January 1995 shows the capital facilities to be provided with proceeds of the new demand charge and the estimated costs of those facilities. A copy of the study is on file with the Executive Secretary and is incorporated herein by reference; WHEREAS, Metropolitan has determined it has legal authority to impose such new demand charge as a water rate pursuant to Section 134 of the Metropolitan Water District Act, as an availability of service charge pursuant to Section 134.5 of the Metropolitan Water District Act, and as a capital facilities fee pursuant to Section 54999.2 of the California Government Code: WHEREAS, notice has been given to the public and to each member public agency of Metropolitan of the intention of Metropolitan's Board of Directors to consider and take action at its regular meeting to be held March 13, 1995, to impose a new demand charge of $1,000 per acre foot of water on all sales representing new demands (as defined in Metropolitan's Resolution 8465) on Metropolitan in fiscal year 1995-96; WHEREAS, at its meeting on January 24, 1995, the Board of Directors ("Board") of the San Diego County Water Authority (the "Authority") approved implementation of Metropolitan's new demand charge on the Authority as a new demand charge on the Authority's member agencies in accordance with recommendations contained in the Board letter on Implementation of MWD Revised Rate Structure, dated January 5, 1995, with implementation of these charges to begin in Fiscal Year 1995-96. A copy is on file with the Executive Secretary and is incorporated herein by reference; -a. WHEREAS, the Authority has legal authority to impose such new .demand charge under Section 45-5 (13) of the Water Authority Act; NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the San Diego County Water Authority, does hereby resolve, determine and order as follows: Section 1. That the public interest and necessity require the Authority to impose a new demand charge on all sales representing new demand on the Authority, as described below, to be collected from the Authority's member agencies to provide for payment of Metropolitan's new demand charge on the Authority; Section 2. That such new demand charge for Fiscal Year 1995- 96 shall be a water rate of $1,000 per acre foot for all new demands by a member agency on the Authority, determined as provided in Section 3 below; Section 3. That the new demand charge shall be imposed on an Authority's member agency when the average of the member agency's purchases (in acre feet) from the Authority in the four most recent years, including the current fiscal year, after adjustment for long-term storage water, exceed such member agency's new demand charge base. Such new demand charge shall be payable in the fiscal year following the year in which it is imposed. Long-term seasonal deliveries during May through September 1993 and May and June 1994, and water taken under one-time drought storage agreements, Cooperative Storage Program through April 12, 1994, and the 1993 Demonstration Program are subtracted from the water sales calculation through the fiscal year ended June 30, 1994. Long-term seasonal storage service water is defined as water that a member public agency leaves in storage past the end of the fiscal year through avoided production during a period of availability (normally October 1, through April 30). Long-term seasonal storage service, cyclic storage, Cooperative Storage Program, and contractual long-term storage water deliveries will be excluded from the new demand charge calculation during the year of delivery but will be included in the year of use. Member agencies shall indicate the amount and year in which the long-term stored water is used. Long-term seasonal storage service water must be accounted for within seven years from the year in which the water was placed into storage; Section 4. That each member agency's new demand charge base (in acre feet) will be determined on the largest of two averages: (1) the average of its purchases from the Authority in the three fiscal years 1989-90 through 1991-92, excluding one-time drought storage sales; (2) the average of its purchases from the Authority in the four fiscal years 1989-90 through 1992-93, excluding one- time drought storage agreement sales and long-term seasonal storage deliveries attributable to May and June 1993. Each member agency's new demand charge base is as follows: -2- 4 Proposed New Demand Charge Base Member Aqency Base Amount (AF) Carlsbad De1 Mar Escondido Fallbrook Helix Oceanside Olivenhain Otay Padre Dam Pendleton Poway Rainbow Ramona Rincon San Diego San Dieguito Santa Fe Sweetwater Vallecitos Valley Center Vista Yuima 16,041 1,382 21,849 15,374 36,553 26,235 12,286 20,641 18,422 1,293 12,282 30,016 12,602 7,532 210,578 6,216 9,962 23,508 11,566 47,057 15,995 1,919 Total 559,309 Section 5. That this Board finds and determines that such new demand charge base is a reasonable approximation of each member agency's current demands on the Authority's system and that the charge is necessary to pay for facilities furnished by Metropolitan and does not exceed the share of each agency's cost of such facilities based on the proportionate benefit received; Section 6. That upon payment of any new demand charge by a member agency, that member agency's new demand charge base shall be increased by an amount equal to the quantity of water on which the new demand charge was paid; Section 7. That the new demand charge shall be incurred upon the Authority's determination that a member agency's historic average deliveries of Authority water in the immediately preceding four fiscal years have exceeded such member agency's new demand charge base. Any new demand charge so incurred shall be due and payable sixty days after mailing of the Authority's invoice for such charge, and shall be subject to the provisions of Section 16.8 of the Authority's Administrative Code for the billing and payment for water deliveries; Section 8. *. That such new demand charge may be paid, without ,penalty, in equal monthly installments over a period of up to 'fifteen years, provided that amounts subject to deferred payment -3- shall bear interest at Metropolitan's new demand charge financing rate applicable at the time, from the date due until payment is received by the Authority; Section 9. That the General Manager and the General Counsel are hereby authorized to do all things necessary and desirable to accomplish the purposes of this Resolution, including, without limitation, the commencement or defense of litigation; Section 10. That this Board finds that the proposed new demand charge is exempt from the provisions of the California Environmental Quality Act ("CEQA") since it constitutes the creation of government funding mechanisms which do not involve commitment to any specific project which may result in a potentially significant physical impact on the environment or which will be used to fund projects which have CEQA documentation or which will have CEQA documentation in place prior to construction of any facility or facilities; Section 11. That the General Manager is hereby authorized and directed to take all necessary action to satisfy relevant statutes requiring notice by publication, if applicable, and that notice is hereby given that the Authority's Board will hear, consider and take action at its meeting of March 9, 1995 to impose a new demand charge of $1,000 per acre foot of water on all sales necessary to meet new demands by member agencies on the Authority; Section 12. That the Executive Secretary is hereby directed to transmit a certified copy of this Resolution to the presiding officer of the governing body of each member agency; PASSED, APPROVED AND ADOPTED, this 9th day of February, 1995. AYES: Unless noted below all Directors voted aye. NOES: Anderson, Chenelle, Peay, Tinker and Turner. ABSTAIN: ABSENT: Broomell, Griffen, Hughes, Board of Directors -4- ATTEST: -. J ,_ ./_$“- 1’ ,,’ , aLJ S. D. Anderson, Secretary Board of Directors - I, Janet R. Maltman, Executive Secretary of the Board of Directors of the San Diego County Water Authority, do hereby certify that the above and foregoing is a full, true and correct copy of said resolution No. 95-9 of said Board and that the same has not been amended or repealed. ard of Directors njs . . -5- RESOLUTION NO. 95-10 EXHIBIT 2 RESOLUTION OF THE BOARD OF DIRECTORS OF THE SAN DIEGO COUNTY WATER AUTHORITY GIVING NOTICE OF INTENTION TO IMPOSE READINESS-TO-SERVE CHARGE WHEREAS, at its meeting.of.January 10, 1995, the Board of Directors of the Metropolitan Water District of Southern California ("Metropolitan") adopted Resolution 8464 giving notice of intention to impose a readiness-to-serve charge on its member agencies. The resolution is on file with the Executive Secretary and is incorporated herein by reference; WHEREAS, the readiness-to-serve charge is intended to recover the debt service of expenditures for projects needed to meet the reliability and quality needs of existing users of Metropolitan's water: WHEREAS, Metropolitan has determined it has legal authority to impose such readiness-to-serve charge as a water rate pursuant to Section 134 of the Metropolitan Water District Act, as an availability of service charge pursuant to Section 134.5 of the Metropolitan Water District Act, and as a capital facilities fee pursuant to Section 54999.2 of the California Government Code; WHEREAS, notice has been given to the public and to each member public agency of Metropolitan of the intention of Metropolitan's Board of Directors to consider and take action at its regular meeting to be held March 13, 1995 to impose a readiness-to-serve charge for fiscal year 1995-96; WHEREAS, the proposed readiness-to-serve charge and amount applicable to Metropolitan's member agencies, the method of its calculation, and the specific data used in its determination are as specified in the Engineer's Report attached as Attachment 1 to Metropolitan's Resolution 8464; WHEREAS, such readiness-to-serve charge may, at the request of any Metropolitan member agency obligated to pay such readiness-to- serve charge, be raised by a Metropolitan water standby charge imposed upon land within Metropolitan's (and such member public agency's) service area to which water is made available by Metropolitan for any purpose, whether the water is actually used or not; WHEREAS, at its meeting on January 24, 1995, the Board of Directors ("Board") of the San Diego County Water Authority (the "Authority") approved implementation of Metropolitan's readiness-to serve charge as a readiness-to-serve charge on the Authority's member agencies in accordance with recommendations contained in the *. Board letter on Implementation of Metropolitan's Revised Rate Structure, dated January 5, 1995, with implementation of these 'charges to begin in Fiscal Year 1995-96. The letter is on file with the Executive Secretary and is incorporated herein by reference; WHEREAS, the Authority has legal authority to impose such readiness-to-serve charge under Section 45-5 (13) of the Water Authority Act; NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the San Diego County Water Authority, does hereby resolve, determine and order as follows: Section 1. That the Authority agrees to the terms and conditions in Metropolitan's Resolution 8464 for imposition of a standby charge and that the General Manager is hereby directed to notify Metropolitan on or before March 1, 1995 that Metropolitan's standby charge be imposed and collected on property tax bills for properties within the Authority's service area at the same rate as Metropolitan's 1994-95 standby charge, and that the standby charge collections will be credited against the Authority's readiness-to- serve obligation due Metropolitan. -The General Manager is hereby authorized to pay any remaining portion of the Authority's readiness-to-serve obligation not collected through Metropolitan's standby charge collections; Section 2. That the public interest and necessity require the Authority to impose a readiness-to-serve ~charge on each of its member agencies to provide for payment of Metropolitan's readiness- to-serve charge to fund the capital facilities to be provided by Metropolitan to meet the reliability and quality needs of existing users of the Authority's water; Section 3. That the amount of such readiness-to serve charge to be incurred by the Authority, based upon Metropolitan's Resolution 8464, is $14,866,366 and that notice is hereby given of the intention of the Authority's Board to hear, consider and take action to impose a readiness-to-serve charge on its member agencies in that amount at its regular meeting on March 9, 1995; Section 4. That such readiness-to-serve charge for Fiscal Year 1995-96 is a water rate equal to $36.65 per acre foot charged on a historic basis for each acre-foot of water included in the Authority's average water deliveries to its member agencies for the two fiscal years ended June 30, 1994; Section 5. That the readiness-to-serve charge from Metropolitan on the Authority shall be allocated among the Authority's member agencies in proportion to the average of Authority water sales (in acre feet) to each member agency initially during the past two fiscal years ended June 30, 1994 ("Original Allocation Basis"). Long-term seasonal storage service, cyclic storage, and direct groundwater replenishment deliveries and water taken under the one-time drought storage agreements, Cooperative Storage Program through April 12, 1994, and 1993 Demonstration Program will be subtracted from the water sales calculation in the past two fiscal years ended June 30, 1994. -0. -Long-term seasonal storage service water is defined as water that 'a member public agency leaves in storage past the end of the fiscal -2- ,’ L 7 year through avoided production during a period of availability (normally October 1 through April 30). The amount of the readiness-to-serve charge proposed to be imposed on each,member agency for fiscal year 1995-96 is as follows: Proposed Readiness-to-Serve Charge Member Aqency . Amount Carlsbad De1 Mar Escondido Fallbrook Helix Oceanside Olivenhain Otay Padre Dam Pendleton Poway Rainbow Ramona Rincon San Diego San Dieguito Santa Fe Sweetwater Vallecitos Valley Center Vista Yuima Total $14,866,366 $ 547,826 50,346 450,562 458,938 930,979 948,555 450,342 756,575 675,257 39,624 408,720 877,408 323,731 229,295 5,066,671 143,806 223,846 211,884 423,960 1,343,640 267,068 37,333 Section 6. That the allocation of the readiness-to-serve charge among member agencies set forth in Section 5 above is consistent with the per-acre-foot water rate imposed pursuant to Section 4 above; Section 7. That it is the intent of the Board that for fiscal years 1995796, 1996-97, and 1997-98, a member agency's readiness- to-serve charge allocation will be based on the average of Authority water deliveries to each member agency during the two fiscal years prior to the most recent fiscal year. For fiscal year 1998-99, a member agency's readiness-to-serve allocation will be based on the average of Authority water deliveries to each member agency during the past three fiscal years ending June 30, 1997. For fiscal year 1999-2000 and thereafter, a member agency's readiness-to-serve allocation will be based on the average of Authority water deliveries to each member agency during the four fiscal year periods prior to the most recent fiscal year. Long- t. term seasonal storage service, cyclic storage, Cooperative Storage .Program, and contractual long-term storage water deliveries will be -excluded from the readiness-to-serve calculation during the year of -3- delivery but will be included in the year of use. Member agencies shall indicate the amount and year in which the long-term stored water is used. Long-term seasonal storage service water must be accounted for within seven years from the year in which the water was placed into storage. No member agency's allocation of readiness-to-serve charges can be reduced below 50 percent of its Original Allocation Basis as determined in Section 5 nor can an agencies allocation of charges.be.above the New Demand Charge base as determined in Section 4 of Resolution 95- ; Section 8. That this Board finds that a readiness-to-serve charge on its member agencies is necessary for payment of costs of public utility facilities furnished by Metropolitan for the benefit of the Authority and its member agencies as specified in the Engineer's Report attached as Attachment 1 to Metropolitan's Resolution 8464; is equitably allocated to member agencies on the basis of a rolling average of historical water purchases because it encourages water management practices and assures that all member agencies pay a share of the fixed costs necessary to meet their reliability and quality needs that is directly proportional to the benefit derived from the system; and should be a fixed charge which contributes to revenue stability and security during times of drought or lack of water sales; Section 9. That except as provided in Section 12 below with respect to any readiness-to-serve charge credit collected by means of a water standby charge, the net readiness-to-serve charge shall be due in ten equal monthly installments on the last business day of the month, commencing September 30, 1995 and shall be subject to the provisions of Section 16.8 of the Authority's Administrative Code for the billing and payment for water deliveries; Section 10. That such readiness-to-serve charge on a member agency shall be reduced by the water standby charge imposed by Metropolitan upon land within such member agency's service area to which water is made available by Metropolitan for any purpose, whether the water is actually used or not; Section 11. That the rate of the standby charge proposed to be levied by Metropolitan to collect all or a portion of a member agency's readiness-to-serve charge is $11.51, per acre of land, or per parcel of land less than an acre within the Authority and such member agency; Section 12. That the proposed water standby charge, if imposed, collected and certified by Metropolitan shall be applied by the Authority as a credit against the applicable member agency's readiness-to-serve obligation due to the Authority. The General Manager shall be authorized to determine the amount of each agency's credit by computing the amount of Metropolitan's standby charge collected within the service territory of each member *. agency. If a member agency's readiness-to-serve charge allocation .is fully satisfied by such credit, any remaining uncredited amount -of standby charge collections shall be applied to other outstanding -4 - . .- c obligations of such member agency to the Authority or be retained as a credit for the future readiness-to-serve obligations of such agency; Section 13. That no deferral or exemption from Metropolitan's water standby charge shall reduce the applicable member agency's readiness-to-serve charge obligation due the Authority, nor shall any failure to collect, or any delay in collecting, any standby charges excuse or delay payment of any portion of the readiness-to-serve charge when due. All amounts collected as water standby charges pursuant to this Resolution shall be applied solely as credits to the readiness-to-serve charge of the applicable member agency, with any excess collections being carried forward and credited against other outstanding obligations of such member agency to the Authority; Section 14. That the General Manager and the General Counsel are hereby authorized to do all things necessary and desirable to accomplish the purposes of this Resolution, including, without limitation, the commencement or defense of litigation; Section 15. That this Board finds that the proposed readiness-to-serve charge and other charges provided in this Resolution are exempt from the provisions of the California Environmental Quality Act ("CEQA") since they are rates and other charges which are for the purposes of meeting operating expenses; purchasing or leasing supplies, equipment or materials; meeting financial reserve needs and requirements; and obtaining funds for capital projects necessary to maintain service within existing service areas; and, additionally, since they constitute the creation of government funding mechanisms which do not involve commitment to any specific project which may result in a potentially significant physical impact on the environment or which will be used to fund projects which have CEQA documentation or which will have CEQA documentation in place prior to construction of any facility or facilities; Section 16. That if any provision of this Resolution or the application to any member agency, property or person whatsoever is held invalid, that invalidity shall not affect other provisions or applications of this Resolution which can be given effect without the invalid portion or application, and to that end the provisions of this Resolution are severable; Section 17. That the General Manager is hereby authorized and directed to take all necessary action to satisfy relevant statutes requiring notice by publication, if applicable; Section 18. That the Executive Secretary is hereby directed to transmit a certified copy of this Resolution to the presiding officer of the governing body of each member agency and to Metropolitan, Attention: Chief of Planning and Resources, not later than March 1, 1995 as the request of the Authority that -5- Metropolitan collect its standby charge from land within the Authority's service area; PASSED, APPROVED AND ADOPTED, this 9th day of February, 1995. AYES: NOES: ABSTAIN: ABSENT: Unless noted below all Directors voted aye. Anderson, Chene-lle, Peay, Tinker and Turner. Broomell, Griffen, Hughes Board of Directors ATTEST: *. _’ f/Q/ y,&,, ,.A Lr, >S. D. Anderson, Secretary Board of Directors I, Janet R. Maltman, Executive Secretary of the Board of Directors of the San Diego County Water Authority, do hereby certify that the above and foregoing is a full, true and correct copy of said resolution No. 95-10 of said Board and that the same has not been amended or repealed. J&net R. Maltman, Executive Secretarv doard of Directors I' njs -6- EXHIBIT 3 READINESS-TO-SERVE-CHARGE - FY 1995-96 AGENCY ALLOCATION RTS BASIS(AF)* CHARGE VID (BUENO COLORADO) CARLSBAD DEL MAR ESCONDIDO FALLBROOK HELIX OCEANSIDE OLIVENHAIN OTAY PADRE DAM PENDELTON POWAY RAINBOW RAMONA RINCON SAN DIEGO SAN DIEGUITO SANTA FE SWEETWATER VALLECITOS VALLEY CENTER YUIMA 7,286 $267,068 14,946 $547,826 1,374 $50,346 12,292 $450,562 12,521 $4=,= 25,399 $930,979 25,878 $948,555 12366 $450,342 20,641 $756,575 18,422 $675,257 1,081 $39,624 11,151 $408,720 23,937 $877,408 8,832 $323,731 6,256 $229,295 138,226 $5,066,671 3,923 $143,806 6,107 $223,846 5,781 $211,884 11,566 $423,= 36,657 $1,343,640 1,019 $37,333 TOTAL.. . . . . . . . . . . . . . . $05,577 14,866,366 REQUIRED COLLECTION.. 14,866,366 RTS PER AF . . . . . . . . . . . . . . . . . . . 36.65 ‘THE LOWER OF: AVERAGE OF A.F. SALES IN FISCAL YEAR 1993 AND FISCAL YEAR 1994 OR AGENCY NEW DEMAND BASE. i’ 1 1 , i 1 ; I i I , ! , I I I 1 I I I I I / I EXHIBIT 4 -I- , 1 I I , , , I , / !I : , g 9 P / 8 d ; 4: 0’ I T _- . EXHIBIT 5 . > LL cn E a> s 0 Q E 0 c) 3 a z 2 LL a, ol i3 c 0 a> 2 a s a E .I a > s 0 .- 2 s s 0 0 a t S n z a a, I3 S CD > a, u Cd -5 F 9 n 3 r 5 9 s a cn .- : E 0 0 cl a> 3 ‘i LL -E 0 Q Q 3 cn 0 a 3 s a > a u U a X .- IL a U .- > 0 L cn a cn a a> t c >r g 0 E 0 c> a 3 5 LL a N .- . UP i j -- 9 a!i ‘.. U S 3 LL 0 Ii a n S 0 s ir CD E a U c a CD t 0 * w .- U a L 0 a > .- a> 0 a U U a> =5 a E 3 0 s .- Iii a > 8 cn E 0 U 0 .- ii5 [L a 8 m u a a 54 w > 0 > a U 0 .m iii L a cn cd m til > 0 LL a a 0 0 ‘0 d 0 0 cv > LL S .- m ;; i O-