1998 AGN MAY 05 I22 - Laserfiche WebLink

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CITY OF COLTON CITY COUNCIL AGENDA REPORT For City Council Meeting of May 5, 1998 TO: Honorable Mayor and City Coun it Members APPROVAL: Henry T. Garcia, City Manager FROM: Thomas K. Clarke, Utility Director SUBJECT: Set For Public Hearing the Adoption of an Ordinance Approving a Sewer Rate Increase DATE: Apri128, 1998 BACKGROUND Every five years the Wastewater Division is to conduct a Wastewater Master Plan which evaluates the current condition of the sewer system and makes recommendations regarding repairs and upgrades of the existing facilities and projects the needs of new infrastructure based upon finite growth assumptions. From this document, a Capital Improvement Program (CIP) can be developed so that the sewer system can continue to provide safe, reliable, and economical service to the community. Two years ago, a rate increase was approved that went into effect in July, 1996. At the time of that approval, the financial plan indicated a second rate increase to be effective in July of the current year. That increase was projected in the 8 to 9 percent range. At the time of the discussion pertaining to the increase, only the Wastewater Treatment Plant expansion was factored in to the rate scenario. Some accommodation was made for an on-going CIP. However, none of the specific recommendations were available. Therefore, the current rate request includes the consultant's findings, the input from the Utilities Commission workshop, and the revised financing scenario that is reflective of the State Revolving Fund loan. DISCUSSION ! ANALYSIS Kennedy and Jenks has completed the Master Plan and submitted the final document to the Utility Department for consideration and action. The Utilities Commission reviewed the plan and the proposed CIP. They have determined that there is approximately $13,851,200 of system improvements required to bring the wastewater system up to the necessary standards to provide reliable service. These improvements are apportioned to both the existing system as well as that required to accommodate future growth. It is staff's recommendation to concentrate more on system rehabilitation and existing repairs in the short-term, and plan for growth as it occurs in the future. This will obviously place more emphasis on upgrading the older sections of the City first, and recognize that the newer sections have relatively new and adequate sewage collection infrastructure. It should be clearly noted that the recommendations and subsequent work on the system do not include the repairs and expansion at the Wastewater Treatment Plant. That work has been authorized and designed in a separate action outside the scope of the Wastewater Master Plan. It should be emphasized, though, that the financial impacts of the change from a revenue bond (envisioned in the plan developed two years ago) to the funding from the State Revolving Fund have been factored into the new financial plan. This does result in a change to the anticipated rate increase in an upward fashion. Itm # 22