HomeMy WebLinkAboutRes2009-118 Sponsored by: Oates
CITY OF SEWARD, ALASKA
RESOLUTION 2009 -118
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, AMENDING THE WASTEWATER TARIFF AND PROVIDING
FOR AUTOMATIC ANNUAL ADJUSTMENTS TO ALL RATES AND
FEES BY AN AMOUNT EQUAL TO THE FIVE PREVIOUS FULL
YEARS' AVERAGE INCREASE IN THE ANCHORAGE CONSUMER
PRICE INDEX FOR ALL URBAN CONSUMERS
WHEREAS, the most recent external comprehensive study of the City of Seward's
utility rates was conducted sixteen years ago (in 1993) by R.W. Beck, resulting in several
amendments to the City's wastewater tariff; and
WHEREAS, since 1993 wastewater rates have been amended twice; once to increase
rates by 5% effective January 1, 2004; and a 15% increase effective January 1, 2005; and
WHEREAS, from 1993 through 2008 the consumer price index has risen 39.62 %, while
rate increases associated with operating and maintenance costs have risen only 20 %; and
WHEREAS, the City of Seward's enterprise funds are operated in a manner similar to
_., private business entities, in that they establish charges intended to cover the full cost of providing
services (including direct and indirect costs) including operations and maintenance, overhead,
system expansion, and charges for the use of capital facilities; and
WHEREAS, the Seward City Council conducted five enterprise fund capital
infrastructure and rate review work sessions in preparation for the 2010/2011 Biennial Budget,
the outcome of which identified the need to raise rates in order to cover the cost of capital
infrastructure repairs and replacement, as well as operational shortfalls; and
WHEREAS, in order to qualify for low- interest loans and bond financing for capital
infrastructure, the City must be able to demonstrate the adequacy of utility rates as well as the
financial capacity for debt repayment; and
WHEREAS, the result of the 2010/2011 Budget process was a decision to increase
wastewater rates by 4.8% (equals five -year average CPI of 2.8% plus 2 %) effective January 1,
2010, and 5.1% (equals five -year average CPI of 3.1% plus 2 %) effective January 1, 2011, in
addition to automatic rate increases annually thereafter, equal to the five -year average CPI each
year effective the first billing cycle of each year, in order to, at a minimum, keep pace with
increased cost increases; and
CITY OF SEWARD, ALASKA
RESOLUTION 2009 -118
WHEREAS, annual rate adjustments will assist in demonstrating the City's commitment
to maintaining a financially sound utility, and will serve to mitigate potential `rate shock'
associated with infrequent rate hikes.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF SEWARD, ALASKA that:
Section 1. The Wastewater Tariff is hereby amended to establish a new initial
paragraph prior to "Group A- Residential" on Page 4 -1, to read as follows:
Annual Adjustment: The rates and fees herein provided are adjusted annually
beginning the first billing of each calendar year to reflect the average of the five
previous published years' annual increases in the Consumer Price Index, All Items,
1982-84=100 for all Urban Consumers, Anchorage, Alaska Area ("CPI") as published
by the United States Department of Labor, Bureau of Labor Statistics. (For example,
2010 rates reflect an increase based on the average CPI for 2003 - 2007).
Section 2. All previous Resolutions in conflict herewith are hereby repealed effective
December 31, 2009.
.....
Section 3. The rates, fees, and charges incorporated herein by reference and attached
hereto as "Sewer Rates and Charges — 2010" are effective January 1, 2010, and as "Sewer Rates
and Charges — 2011" are effective January 1, 2011, and are hereby ADOPTED.
Section 4. This resolution shall take effect ten days following approval.
PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this
10 day of November, 2009.
THE CITY SEWARD, ALASKA
9 4/,-,,',.,,,,
Willard E. Dunham, Mayor
AYES: Valdatta, Bardarson, Smith, Keil, Shafer, Amherg, Dunham
NOES: None
ABSENT: None
ABSTAIN: None
S
CITY OF SEWARD, ALASKA
RESOLUTION 2009 -118
ATTEST:
Johanna Dollerhide, CMC
Acting City City Clerk
(City Seal)
0 .1t
M °+ 'C t
®;
" ,
•
i ^`�tiey • 1
Council Agenda Statement
Meeting Date: November 9, 2009
e of sF
Through: Phillip Oates, City Manage
9 t
From: W.C. Casey, Public Works Director O. q p
Agenda Item: Amending the Wastewater Tariffand Providing for
Automatic Annual Adjustments to All Rates
BACKGROUND & JUSTIFICATION:
The Seward City Council has held live work sessions over the past two months to discuss the
wastewater tariff, listen to staff feedback and solicit public testimony regarding the 2010 and 2011
Wastewater Budgets. Several funding strategy options were discussed by Council, including
recommendations from the Bird Enterprise Fund Study, options and ideas derived from public
testimony, and suggestions and information provided by Staff.
Customer rates and charges in the Wastewater Enterprise Fund, have been amended twice (5% in
2004 and 15% in 2005) since the 1990's. The cumulative consumer price index between 1993 and
2008 is in excess of 39 %. Due to the manner in which the wastewater fund is operated (similar to
private business entities), expenses and operating costs have gradually begun to exceed revenues.
Generating revenues in a manner that will allow for the funding of depreciation and capital projects
(as well as repair and replace infrastructure) has become unachievable. Compounding the issue of
revenue shortfalls', is the ADEC requirement that the Wastewater Fund show proof for the financial
capacity to incur debt. ADEC has sustained its ability to make funds available through grants and
loans, and it is important for the City to maintain the leverage to take advantage of these funding
mechanisms' (70 % -30% Municipal Matching Grants and 1.5% Municipal Loans). Forward thinking in
regards to Project Development and Project Funding is crucial in order to make the City eligible for
these opportunities.
Additionally, the implementation of small rate increases annually or bi- annually, as opposed to large
increases periodically, enables the utility customers the opportunity to plan, budget and avoids "rate
shock ".
INTENT:
The adoption of the proposed amendments to the Wastewater Tariff and providing for automatic
annual adjustments to all rates will improve the financial condition of the Wastewater Enterprise
Fund.
CONSISTENCY CHECKLIST:
Where applicable, this Resolution is consistent with the Seward City Code, Charter, Comprehensive
Plans, Land Use Plans, Strategic Plan and City Council Rules of Procedures.
Other: Water and Sewer System Modeling and Analyses (June 2000).
FISCAL NOTE:
Rates to be adjusted annually beginning the first billing of each calendar year to reflect the average of
the five previous published years' annual increases in the Consumer Price Index.
Approved by Finance Department:
ATTORNEY REVIEW: Yes
RECOMMENDATION:
Council approve Resolution 2009 - 11'6 , amending the Wastewater Tariff and providing for the
automatic annual adjustments to all rates and fees by an amount equal to the five previous full years
average increase in the Anchorage consumer price index for all urban consumers.
Sewer Rates and Charges - 2010
Rates for Sewer by Class of Service
kNNUAL RATE ADJUSTMENT: The rates and fees herein provided are adjusted annually beginning the first
P )filling of each calendar year to reflect an average of the five previous published years' annual increase in the Consumer
rice Index, All Items, 1982 -84 =100 for all Urban Consumers,
United States Department of Labor, Burcau of Labor Statistics. (For l example, 2010 rates reflect an incr based
the average CPI for 2003 - 2007.)
GROUP A - RESIDENTIAL
Group A includes all residential customers living in single family or multiple family living units. Multiple
family units includes multi - plexes, apartments and townhouses, but excludes hotels, motels and similar transient
accommodations.
GROUP B - SMALL GENERAL SERVICE
Group B includes commercial enterprises where the use of water is incidental to the commercial activity and is
primarily limited to domestic and janitorial use. This class of service includes such businesses as hotels, motels,
professional office buildings, barber shops, warehouses, libraries, public offices, churches and theaters, etc.
GROUP C - LARGE GENERAL SERVICE
Group C includes commercial enterprises where water usage is greater than in Small General services
and /or water is used for food preparation or other activities, but not for industrial processing.
GROUP D - METERED COMMERCIAL & INDUSTRIAL SERVICE
Group D includes commercial and industrial enterprises where water usage is greater than for small
businesses and /or water is used for food preparation, other activities and industrial processing as well as
general domestic users.
BASIS FOR MONTHLY FEES AND CHARGES
GROUPS A - D
NON - METERED SERVICES
Non- metered sewer users in Groups A, B and C shall be charged at the rate of S45.18 per ERU per
month, not including tax, when the water service and sewer service serve the same activities. If the
activities serviced by the sewer services are different than those served by water, a water charge shall be
computed based on the activites served by the sewer, and the sewer rate shall be 1.2 times the computed
water charge
VIETERED SERVICES
City of Seward Sewer Tariff- Revised 11 /09/09, Effective January 1, 20/0
Page 4 -1
Users with metered service (Group D) shall be charged for sewer service according to the rates
listed below. The charge shall be based upon the quantity of metered water, except that those users having
a sewer meter shall be charged for the quantity of sewage actually metered. The quantity of sewage will
be adjusted if a significant amount of waste water is not discharged into the city sewer system
•••
MOW
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 2010 Page 4 -2
Minimum Charge for Each Metered Service
Service Size Minimum Monthly Charge
3/4" - 1" water ervice $38.53
1 -1/2" - 2" water service $63.78
2 -1/4" - 4" water service $160.78
Over 4" water service $803.89
Charge for Consumption
Gallons of Sewage Discharged per Month I Charge per 1,000 Gallons
Groups A, B & C Group D
First 10,000 Gallons $5.65 S9.09
Next 40,000 Gallons $4.53 $7.27
Next 50,000 Gallons $3.76 $6.07
Next 100,000 Gallons $3.39 $5.47
Next 500,000 Gallons $1.67 $3.52
Next 500,000 Gallons $1.67 $3.52
All Additional Gallons $1.67 $3.52
GROUP E - SPECIAL RATES AND FEES
Group E includes charges for other categories of service not included in Groups A through D.
City of Seward Sewer Tariff - Revised 11/09/09, Effective Jauuany I, 2010
Page 4 -3
1. Users generating sewage with a BOD and Specified rate in rate tables times a factor of the
SS loading in excess of mg /1 (upon a deter- actual BOD and SS loading divided by 250, plus
mination by the utility manager that the the cost of testing
concentration and characteristics of the
sewage will not cause a detrimental effect WNW
upon the sewer system and /or treatment
plant [BOD = ABiological Oxygen
Dernand@ and SS = ASuspended Solids @]
2. Tank Truck Operators: Fresh sewage, or Per thousand gallons: $43.85
waste from portable or chemical toilets,
provided the utility manager determines the
waste will not he detrimental to the sewer
system and /or treatment plant.
NOTE:
It is prohibited to discharge into the city =s
sewer system, septic tank waste or any waste
containing toxic or other materials that could
cause the city =s discharge to violate the
EPA or DEC discharge permit.
INIONO
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 2010 Page 4 -4
3. Recreational Vehicles: Individual RV No fee
owners utilizing city -owned or approved
dump sites
Public and private campground operators $0.73 per day Per RV, camper or trailer permit,
[Operators must maintain sufficient records not including tent campers.
to compute a monthly payment, and such
records shall he made available to the city
upon request.]
4. Ship =s Sewage: Not accepted
5. Sewer Service Connection Fee: Installed at property owner =s expense. Any
work performed by the city will be charged at
total cost, including labor, overhead, administra-
tion, materials and equipment.
6. Sewer Service Inspection Fee: This fee $199.32
shall be charged for services installed by
anyone other than the city.
7. Unauthorized Connection or Discharge Per Occurrence $664.37
into the City Sewer System: PLUS Cost of repair, restoration or cleanup by
city
,,,_'LUS State and /or federal penalties & charges Actual cost, including city overhead, adminis-
levied against the city or individual8. tration, labor, materials and equipment
Restoration of Sewer Service
and Repair of Damage by Owner or
Contractor to City Facilities:
9. Locate Service: First Locate:No Charge
Each Additional Locate: $66.44
Large projects requiring several locates will be
under a special contract and may require a fee.
10. Security Deposit: If a water security Domestic: $33.22
deposit was paid, no additional deposit (Single family & duplex)
will be required. If no water deposit was Commercial: $99.65
paid, the following deposits will be Multi Family: $99.65
charged.
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 2010
Page 4-5
11. Contractor Work: Any contractor tap - $5000.00 Bond or equivalent cash guarantee
ping into a city sewer main, or otherwise payable to the city
working on a city sewer main, must be
properly licensed to perform the work
and must provide:
12. Sewage Meter: Computed from the quantity of metered water
delivered to the same activity unless a sewage
meter has bccn installed. Sewage meters ap-
proved by the city may be installed at the user =s
expense.
13. Delinquent Account Charges: Interest rate: 10.5% per annum
Monthly late fee: $5.24
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 2010 Page 4 -6
Sewer Rates and Charges - 2011
Rates for Scwer by Class of Service
tNNUAL RATE ADJUSTMENT: The rates and fees herein provided are adjusted annually beginning the first
P )illing of each calendar year to reflect an average of the five previous published years' annual increase in the Consumer
rice Index, All Items, 1982 -84 =100 for all Urban Consumers, Anchorage, Alaska Area ( "CPI ") as published by the
United States Department of Labor, Bureau of Labor Statistics. (For example, 2011 rates reflect an increase based on
the average CPI for 2004 - 2008.)
GROUP A - RESIDENTIAL
Group A includes all residential customers living in single family or multiple family living units. Multiple
family units includes multi- plexes, apartments and townhouses, but excludes hotels, motels and similar transient
accommodations.
GROUP B - SMALL GENERAL SERVICE
Group B includes commercial enterprises where the use of water is incidental to the commercial activity and is
primarily limited to domestic and janitorial use. This class of service includes such businesses as hotels, motels,
professional office buildings, barber shops, warehouses, libraries, public offices, churches and theaters, etc.
GROUP C - LARGE GENERAL SERVICE
Group C includes commercial enterprises where water usage is greater than in Small General services
ind /or water is used for food preparation or other activities, but not for industrial processing.
GROUP D - METERED COMMERCIAL & INDUSTRIAL SERVICE
Group D includes commercial and industrial enterprises where water usage is greater than for small
businesses and /or water is used for food preparation, other activities and industrial processing as well as
general domestic users.
BASIS FOR MONTHLY FEES AND CHARGES
GROUPS A - D
NON - METERED SERVICES
Non- metered sewer users in Groups A, B and C shall be charged at the rate of $47.48 per ERU per
month, not including tax, when the water service and sewer service serve the same activities. If the
activities serviced by the sewer services are different than those served by water, a water charge shall be
computed based on the activites served by the sewer, and the sewer rate shall be 1.2 times the computed
water charge
METERED SERVICES
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 2011 Page 4 -1
Users with metered service (Group D) shall be charged for sewer service according to the rates
listed below. The charge shall be based upon the quantity of metered water, except that those users having
a sewer meter shall be charged for the quantity of sewage actually metered. The quantity of sewage will
be adjusted if a significant amount of waste water is not discharged into the city sewer system
S
City of Seward Sewer Tariff - Revised 1 1/09/09, Effective Janaram 1, 201 I Page 4 -2
Minimum Charge for Each Metered Service
Service Size Minimum Monthly Charge
-- 3/4" - I" water ervice $40.50
1 -1/2" - 2" water service $67.03
2-1/4" - 4" water service $168.98
Over 4" water service $844.89
Charge for Consumption
Gallons of Sewage Discharged per Month I Charge per 1,000 Gallons
Groups A, B & C Group D
First 10,000 Gallons $5.94 $9.55
Next 40,000 Gallons $4.76 $7.64
Next 50,000 Gallons $3.95 $6.38
Next 100,000 Gallons $3.56 $5.75
Next 500,000 Gallons $1.76 $3.70
Next 500,000 Gallons $1.76 $3.70
All Additional Gallons $1.76 $3.70
GROUP E - SPECIAL RATES AND FEES
Group E includes charges for other categories of service not included in Groups A through D.
City of Seward Sewer Tariff - Revised 11/09/09, Effective January I, 2011 Page 4 -3
1. Users generating sewage with a BOD and Specified rate in rate tables times a factor of the
SS loading in excess of mg /1 (upon a deter- actual BOD and SS loading divided by 250, plus
mination by the utility manager that the the cost of testing
concentration and characteristics of the
sewage will not cause a detrimental effect
upon the sewer system and /or treatment
plant [BOD = ABiological Oxygen
Demand@ and SS = ASuspended Solids @]
2. Tank Truck Operators: Fresh sewage, or Per thousand gallons: $46.09
waste from portable or chemical toilets,
provided the utility manager determines the
waste will not be detrimental to the sewer
system and /or treatment plant.
NOTE:
It is prohibited to discharge into the city =s
sewer system, septic tank waste or any waste
containing toxic or other materials that could
cause the city =s discharge to violate the
EPA or DEC discharge permit.
City of Seward Sewer Tariff - Revised 11/09/09, Effective January 1, 7011 Page 4 -4
3. Recreational Vehicles: Individual RV
owners utilizing city -owned or approved No fee
dump sites
Public and private campground operators $0.77 per day Per RV, camper or trailer permit,
[Operators must maintain sufficient records not including tent campers.
to compute a monthly payment, and such
records shall be made available to the city
upon request.]
4. Ship =s Sewage: Not accepted
5. Sewer Service Connection Fee: Installed at property owner =s expense. Any
work performed by the city will be charged at
total cost, including labor, overhead, administra-
tion, materials and equipment.
6. Sewer Service Inspection Fee: This fee
shall be charged for services installed by $209.49
anyone other than the city.
7. Unauthorized Connection or Discharge Per Occurrence $698.25
into the City Sewer System: PLUS Cost of repair, restoration or cleanup by
city
,_'LUS State and/or federal penalties & charges Actual cost, including city overhead, adminis-
levied against the city or individual8. tration, labor, materials and equipment
Restoration of Sewer Service
and Repair of Damage by Owner or
Contractor to City Facilities:
9. Locate Service: First Locate:No Charge
Each Additional Locate: $69.83
Large projects requiring several locates will he
under a special contract and may require a fee.
10. Security Deposit: If a water security Domestic: $34.91
deposit was paid, no additional deposit (Single family & duplex)
will be required. If no water deposit was Commercial: $104.73
paid, the following deposits will be Multi $104.73
charged.
City of Seward Sewer Tariff- Rev/sed 11/09/09, Effective Janua,y I. 2011
Page 4 -5
11. Contractor Work: Any contractor tap- $5000.00 Bond or equivalent cash guarantee
ping into a city sewer main, or otherwise payable to the city
working on a city sewer main, must be
properly licensed to perform the work
and must provide:
12. Sewage Meter: Computed from the quantity of metered water
delivered to the same activity unless a sewage
meter has been installed. Sewage meters ap-
proved by the city may be installed at the user =s
expense.
13. Delinquent Account Charges: Interest rate: 10.5% per annum
Monthly late fee: $5.51
imams
•.m
City of Seward Sewer Tariff- Revised 11/09/09, Effective Januuny 1, 2011
Page 4 -6