Each year the Water Department Staff conducts cost of service studies to establish annual operating revenue requirements for retail water and wastewater services. The resulting revenue requirements are shared with the informal Water and Sewer Retail Rate Structure Stakeholder Group which provides input concerning the City's fair and equitable cost allocation among the retail classes. The Stakeholder Group is made up of representatives of the Residential, Commercial, Industrial, Super User and Irrigation classes. Staff conducted four meetings with the Stakeholder Group to receive input and feedback on topics including untying Irrigation volumetric water rates from Residential rates and moving both Residential and Irrigation tier 2 rates to their cost of service, and continuing the fixed versus variable revenue recovery plan for retail water and sewer service. The Fiscal Year 2017 cost of service studies identified a need for an increase in retail revenue requirements of 1.38 percent for the water system and 1.10 percent for the wastewater system. The recommended Water and Sewer rates include continuation of the phased implementation of increased cost recovery from fixed service charges to improve revenue stability. The primary drivers of the system revenue requirement increases are a 7.17 percent increase in the raw water rate for Fiscal Year 2017; additional debt service and pay-go cash financing to support the City Council-adopted Capital Improvement Plan and improve debt service coverage ratios; and increases in transfers to the General Fund. To generate revenue required to meet the revenue requirements of the Water customer classes, Staff recommends small increases in the Water monthly service charges as part of the revenue stability plan. Based on the recommendations of the Stakeholder Group, Staff recommends setting the tier 2 volumetric rates for Residential and Irrigation classes at their cost of service. Increases in anticipated volumes for Commercial and Industrial customers enable a small decrease from current volumetric rates for these customer classes. The Super User class increases to its cost of service. For sewer service, Staff again recommends increases in the monthly service charges as part of the revenue stability plan for all but the smallest two meter sizes, which would remain unchanged. Staff recommends increasing the volumetric rate charges for the Residential class and the strength charges for the Monitored Class, and decreasing the volume rate charges for the Non-Monitored and Monitored classes based on cost of service factors.
RETAIL WATER RATES Meter Size | Current | Proposed | | 5/8" & 3/4" | $10.50 | $10.75 | | 3/4" x 3/4" | $10.25 | $11.00 | | 1" | $19.25 | $21.10 | | 1 1/2" | $35.00 | $39.15 | | 2" | $53.50 | $60.80 | | 3" | $139.00 | $160.10 | | 4" | $237.00 | $273.85 | | 6" | $502.00 | $580.80 | | 8" | $875.00 | $1,014.15 | | 10" | $1,312.00 | $1,519.75 |
| Customer | Per 100 Cubic Feet | Current | Proposed | | Residential | First 600 CF | $2.07 | $2.12 | | | 600 to 1,800 CF | $2.96 | $2.93 | | | 1,800 to 3,000 CF | $3.69 | $3.69 | | | Over 3,000 CF | $4.44 | $4.44 | | Commercial | All Usage | $2.71 | $2.67 | | Industrial | All Usage | $2.59 | $2.55 | | Super User | All Usage | $2.36 | $2.38 | | Irrigation | 0 to 5,000 CF | $2.96 | $2.96 | | | 5,000 to 10,000 CF | $3.69 | $3.56 | | | Over 10,000 CF | $4.44 | $4.44 | | Gas Wells | All Usage | $5.77 | $5.85 |
RETAIL WASTEWATER RATES | Meter Size | Current | Proposed | | 5/8" & 3/4" | $6.50 | $6.50 | | 3/4" | $6.80 | $6.80 | | 1" | $7.70 | $9.40 | | 1 1/2" | $12.75 | $16.20 | | 2" | $18.80 | $24.30 | | 3" | $46.50 | $61.50 | | 4" | $78.30 | $104.10 | | 6" | $164.00 | $219.05 | | 8" | $285.00 | $381.35 | | 10" | $426.25 | $570.70 | | 12" | $534.10 | $715.10 |
| Residential | Current | Proposed | | Volume Charge (per 100 Cubic Feet) | $3.49 | $3.62 | | | | | | Non-Monitored | Current | Proposed | | Volume Charge (per 100 Cubic Feet) | $4.32 | $4.23 | | | | | | Monitored Group | Current | Proposed | | Volume Charge (per 100 Cubic Feet) | $3.00 | $2.71 | | BOD Charge (per Pound) | $0.2926 | $0.2929 | | TSS Charge (per Pound) | $0.1350 | $0.1558 | | TDS Charge (per Pound) for Gas Well Drillers | $0.0420 | $0.0420 |
This M&C does not request the approval of a business entity. |
