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City of Seward
Capital Requirements & Funding Strategies
for
Electric Enterprise Fund
41*
Purpose
This Presentation is to discuss the financial
and system challenges of the electric
department and present suggestions on the
direction of the department for 2012 and
2013 .
2
6406,
:8%
Electric Balance
ect c as
Electric Fund Cash Balance History
Electric Enterprise Fund - Cash Balance
Balance at December 31, 200X
Electric Fund MRRF # months'
Cash Cash Cash Total
2000 2,862,494 676,664 8.5 '$ 3,539,158
2001 2,729,835 920,884 5.1 r$ 3,650,719
2002 3,072,100 840,884 5.8 '$ 3,912,984
2003 3,825,039 840,884 7.7 '$ 4,665,923
2004 3,260,064 1,340,884 5.5 '$ 4,600,948
2005 3,647,834 645,080 5.9 '$ 4,292,914
2006 2,394,025 1,377,942 3.1 '$ 3,771,967
2007 2,706,708 1,317,765 4.1 r$ 4,024,473
2008 3,103,126 838,105 4.5 '$ 3,941,231
2009 $ 1,334,884 $ 874,234 1.5 r$ 2,209,118
2010 $ (233,894) $ 387,761 -0.3 '$ 153,867
5.0(10.(X)() - 7.7 5.5 # months' cash
5.9
5.8 "- 3.1 4.1 4.5
4,000,0)0 8.5 5.1 — a,:�'
3,000,000 - -�— — — — —
2,00),0)0 — — ■MRRF
0.3 0 Electric Fund
— -1,00),0)0 —
1111111111
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
3
(1,000,000) -
lbw-
r- - -1 ' -
,,,..,
Electric Capital Needs
Critical High Moderate ARCTEC Total
2012 $ 1,005,000 $ 50,000 $ - $ 360,000 $ 1,415,000
_ 2013 835,000 380,000 - 1,000,000 $ 2,215,000 _
2014 440,000 180,000 480,000 1,000,000 $ 2,100,000
2015 - 1,000,000 140,000 1,000,000 $ 2,140,000
2016 - 2,000,000 - 240,000 '5 2,240,000
2017 - 2,000,000 - '5 2,000,000
2018 - - 1,153,000 $ 1,153,000
2019 - - 475,000 $ 475,000
2020 - - - '5
2021 - - - '5
$ 2,280,000 $ 5,610,000 $ 2,248,000 $ 3,600,000 $ 13,738,000
Electric Repairs & Replacement of Existing Assets
2,500,000
2,000,000 —
1,500,000 —
❑ARCTEC
1,000,000 0 Moderate
■High
500,000 ■Critical
0
4
Status of Depreciation Reserves
Electric = $423 ,889 in MRRF vs historic
cost of assets of $56.4 million* ; $31
million end of useful life
Electric Outstanding Debt End of 2010
ELECTRIC FUND
OUTSTANDING DEBT AT 1/1/11
Interest Annual Annual
Debt Issue Rate Balance at 1/1/11 Principal Interest Maturity
1995 Transmission Line Bond 2.95% - 3.88% $ 1,245,000 235,000 41,250 June 2015
2008 Generator Project 5.25% - 6.00% $ 5,815,000 115,000 276,561 June 2038
$ 7,060,000 $ 350,000 $ 317,811
6
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„„id
Capital Projects Completed
o Lowell PointUnderground - $310,447
o Transmission Linerepairs - $452,688
H-Structure (T229)
Damaged Pole (TN67)
Burned Pole (T265)
ConductorRepair (Wire Frayed Out T222-T223)
o Transmission Line Reroute - $494,067
RI McDonald Underground - $25,000
TOTAL = $ 1 ,282,202
Projects Started Not Yet Completed
� Right Of Way (ROW) Clearing
A Transmission to Fort Raymond Substation
A Substation PT Protection Scheme
Z Float and Coast Guard Relocate
(Construction only)
DOT Three Bridges (Construction only)
8
Critical Capital Needs 2012-2017
Likely to Fail in the Next 5 years, must be accomplished
- Going underground by Lagoon - $450,000
(�� Right of Way Clearing - $750,000
Jesse Lee Underground - $30,000
� Camelot Underground - $ 150,000
� Transformer Renovation Fort Raymond -
$200,000
� Paint Transformers and Substation Equipment
- $ 120,000
9
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_ .. _ .•'c- 7..,.`.# � M ¢
• '. -•'�+` r � ;
CriticalCapital
Likely to Fail in the Next 5 years, must be accomplished
- Exhaust Stack and Roof Generator 3 - $360,000
Meter Relay and View Screen - $20,000
J SMIC underground - $ 105,000
4 Transformer Renovation Spring Creek - $200,000
4 Sectionalized Pole Replacement — Price Varies,
Generally $ 17,000 per pole
TOTAL = $2,385,000
10
If we do not fund Critical needs :
e Expect multiple failures and/or running
generators more frequently
e Long outage times for residents and
businesses
e Higher fuel costs for running the backup
generators
High Risk Capital Needs 2017 - 2022
Likely to fail within 5- 10 years
o Old Mill #3 - $ 120,000
o Gateway (Upper) - $ 180,000
o Gateway (Lower) - $80,000
o Woodland Hills - $ 120,000
o Lost Lake Underground - $55 ,000
o Software for inventory - $50,000
High Risk Capital Needs 2017 -2022
Likely to fail within 5-10 years
❑ Wire Reel - $5,000
❑ Downtown Alley 2nd and 3rd install underground -
$ 1 ,000,000 (install overhead - $500,000)
❑ Downtown Alley 3rd and 4th install underground -
$2,000,000 (install overhead - $ 1 ,000,000)
❑ Downtown Alley 4th and 5th install underground -
$2,000,000 (install overhead - $ 1 ,000,000)
TOTAL = $5,610,000
13
f �r
Moderate Risk Needs 2012-2022
Nearing or Past Previously Estimated Life Expectancy
❑ Lawing Poles - $25 ,000
❑ Victor Creek Poles - $ 110,000
❑ Lake Drive (Stony Creek) - $ 140,000
❑ Questa Woods - $80,000
❑ AVTEC Underground - $ 15 ,000
❑ Southwest Boat Ramp - $33 ,000
❑ Lawing to Victor Creek Overhead - $75 ,000
14
M �dera Risk Needs 2( } 12- ■
2022
Nearing or Past Previously Estimated Life Expectancy
0 Update Fort Raymond Controls - $450,000
o Security Upgrades to Substations - $ 130,000
o Automatic Meter Reading (AMR) - $950,000
o Switch at Nash Road - $ 100,000
TOTAL = $2, 108,000
15
Summary of All Capital Improvement Needs
(No Funding to New Projects)
❑ Critical Risk - $2,385 ,000
o High Risk - $ 5 ,610,000
o Moderate Risk - $2, 108,000
16
Summary of ARCTEC $4 ,000 ,000
o PT phase protection
o Generator 3 silencer and roof
o Move generator 4 into the new building
o Move generator 5 into the new building
o Update and modernize controls to allow more
flexibility in starting and running generators
o Office/Warehouse
Projects Requiring Funding to Complete
❑ Converting Fort Raymond substation to
115kV from 69kV $ 12,000,000
This must be done to sync with the rest of the
Railbelt system
Currently steps down at Lawing Substation
A higher voltage transmission line would mean
less losses in transit
18
Projects Requiring Funding to Complete
❑ Complete Transmission Line Into Substation
$ 1 ,500,000
Sixteen structures to complete (past life
expectancy)
Potentially funded through ARCTEC
When substation ready will give us the ability to
receive 115kV
19
Projects Requiring Funding to Complete
o Pole Barn $200,000
Allows us to cover equipment and materials
During Winter Months makes response time
faster
Saves money for electric department
30 year at $200,000 = $6,700 per year
Average pole price $ 1 ,000 / Newest Bucket
Truck $450,000 / Backhoe $90,000
20
Potential Revenue Options
❑ Grant funds
❑ Assessment Districts for distribution service
areas
❑ Service assessment for Right of Way clearing
❑ Higher rates for higher usage
❑ ARCTEC (for generation and transmission)
❑ Revise on/off fees for part time residents
21
�a
Recommendation - $ 1 ,086,356 approximate increase in
revenues per year
❑ An increase to all rates of 7% + 3 % CPI in
2012 and an increase to all rates of 2% + 3%
CPI in 2013 .
o Allow Railroad special contract to expire
placing the service into Large General
Finance (LGS)
o Increase the Icicle Seafood' s and Sealife
Center' s special contracts the same as other
rates
22
Rate Increase Examples Bills (July
2011 Rates)
❑ Residential (600 kWh)
2012: From $115.49 To $ 123.08
2013: From $123.08 To $ 127.26
❑ Small General ( 1500 kWh)
2012: From $303.26 To $323.70
2013: From $323.70 To $334.94
❑ Railroad (Special contract to Large General —
100,000 kWh & 750KW)
2012: From $19, 102.38 To $24,324. 19
2013: From $24,324. 19 To $25,210.86
23
, , •,• . -71
" • '7, - •
'4411111
The precarious position of the electric
department
Yd
24
2011 ELECTRIC RATE COMPARISON TABLES
TABLE OF CONTENTS
RAILBELT RATE COMPARISONS Pages 3-7
Residential Page 3
Small General Service Page 4
Large General Service (Secondary) Page 5
Large General Service (Primary) Page 6
Industrial & Seward Special Contracts Page 7
RAILBELT EXAMPLE MONTHLY BILL COMPARISONS Pages 8-12
Residential Page 8
Small General Service Page 9
Large General Service (Secondary) Page 10
Large General Service (Primary) Page 11
Industrial & Seward Special Contracts Page 12
SEWARD RATE COMPARISON (5%, 10% & 10%+5% INCREASE) Page 13-15
Residential Page 13
Small General Service Page 14
Large General Service Page 15
SEWARD EXAMPLE MONTHLY BILL COMPARISON (5%, 10 % & 10%+ 5% INCREASE) Page 16-18
Residential Page 16
Small General Service Page 17
Large General Service Page 18
JOHN BIRD 2011 RECOMMENDATIONS FOR DISCUSSION Page 19
2
TABLE la: RESIDENTIAL ELECTRICITY RATE COMPARISON (JULY 2011 RATES)
RESIDENTIAL SEWARD HOMER North HOMER South CHUGACH ML&P GVEA MEA
Kachemak Bay Kachemak Bay (Single Phase)
CUSTOMER $16.54 $11.00 $11.00 $8.00 $6.56 $17.50 $5.65
CHARGE
(MONTHLY)*** 2 1
SEASONAL
SERVICE
CHECK
(ANNUALLY) $67.80**
1. ENERGY $.09901 $.14622 $.15011 $.07084 $.09856 $.08791 $.10244<1300KWH
CHARGE/ <800KWH <600KWH $.08324>1300KWH
KWH***
$.13291 $.15863
>800KWH >600KWH
6 3/4 2/1 8 5
2. FUEL ADJUST $.065908 $.04307 $.04307 $.05741 $.01683
CHARGE/ Adjusted Non-contract Non-contract Adjusted Quarterly
KWH Monthly customers** customers** Quarterly
3. PURCHASE
POWER
CHARGE/
KWH $.00575 $.04780
4. REGULATORY
CHARGE/ NA $.000492 $.000492 $.000492 $.000492 $.000492
KWH
TOTAL CHARGE $.146712/ $.150602/ $.150732/
per KWH*** $.164918 $.133402 $.159122 $.134492 $.115882 $.19734* $.131532
(1+2+3+4) 2 6/8 7 10 1
* Includes Fuel & Purchased Power & Regulatory Charge
** Not Included
*** Ranked Highest to Lowest Charges (Black - Higher Than Seward, Blue - Seward & Red - Lower Than
Seward)
3
TABLE lb: SMALL GENERAL SERVICES ELECTRICITY RATE COMPARISON (JULY 2011 RATES)
SMALL GENERAL HOMER North HOMER South MEA
SERVICE SEWARD Kachemak Kachemak CHUGACH ML&P GVEA (Three-Phase)
Bay Bay
CUSTOMER CHARGE $33.08 $150.00 $40.00 $17.00 $12.88 $20.00 $13.37
(MONTHLY)*** 3 1 2 7 4 13
1. ENERGY CHARGE/ $.11421 $.11156 $.14651<3,000 $.05074 $.0955 $.08712
$.06510
KWH***
KWH
$.13198>3000
KWH
3 1/2 7
2. FUEL ADJUST $.065908 $.04307 $.04307 $.05741 $.01683 $.04780
CHARGE/ Adjusted Non-contract Non-contract Adjusted Quarterly
KWH Monthly customers** customers** Quarterly
3. PURCHASE
POWER CHARGE/
KWH $.00575
4. REGULATORY $.000492 $.000492 $.000492 $.000492 $.000492
CHARGE/KWH
TOTAL CHARGE per $.180118 $.112052 $.147002/ $.114392 $.112822
KWH***(1+2+3+4) $ 132472 $.19655 $.113392
2 8 3/4 5 1 6
DEMAND
CHARGE/KW*** $7.7386 $7.7386>10KW $5.27
1 2 3
* Includes Fuel & Purchased Power & Regulatory Charge
** Not Include
*** Ranked Highest to Lowest Charges (Black - Higher Than Seward, Blue - Seward & - Lower Than Seward)
4
TABLE lc: LARGE GENERAL SERVICE (SECONDARY) ELECTRICITY RATE COMPARISON (JULY
2011 RATES)
LARGE GENERAL SEWARD HOMER HOMER South CHUGACH ML&P GVEA MEA
SERVICES (LGS)
SECONDARY Kachemak Bay
CUSTOMER
CHARGE*** $33.08 $150.00 $40.00 $55.00 $44.15 $30.00 $13.37
(MONTHLY) 5 1 4 2 3 6
1. ENERGY $.05566
CHARGE*** $.08181 (1st $.11156 $.14651<3,000KWH $.02496 $.04728 $.06510
200KWH/KW) $.13198>3000KWH
$.04891 (Additional
KWH)
4 3 1/2 7
2. FUEUPOWER $.065908 $.04307 $.04307 $.05741 $.01683 $.04780
ADJUSTMENT Adjusted Monthly Non-contract Non-contract Adjusted Quarterly
CHARGE customers** customers** Quarterly
3. PURCHASED
POWER CHARGE $.00575
4. REGULATORY NA $.000492 $.000492 $.000492 $.000492 $.000492
CHARGE
TOTAL $.147718/ $.112052 $.147002/ $.088612 $.072982 $.15671* $.113392
CHARGE/KWH*** $.114818 $.132472
(1+2+3+4) 2/5 7 =/4 9 1
DEMAND $14.49 $7.7386 $7.7386>10KW $11.45 $12.33 $10.79 $5.27
CHARGE/KW*** 1 2
* Includes Fuel & Purchased Power & Regulatory Charge
** Not Included
*** Ranked Highest to Lowest Charges (Black - Higher Than Seward, Blue - Seward & ` - Lower Than
Seward)
5
TABLE Id: LARGE GENERAL SERVICES (PRIMARY) ELECTRICITY RATE COMPARISON (JULY
2011 RATES)
LARGE GENERAL HOMER South
SERVICES SEWARD HOMER Kachemak Bay CHUGACH ML&P GVEA MEA
(LGS) PRIMARY
CUSTOMER $33.08 $150.00 $40.00 $55.00 $159.55 $30.00 $13.37
CHARGE***(MONTHLY) 5 2 4 3 1 ;%
1. ENERGY CHARGE*** $.08181 (1st $.11156 $.14651<3,000KWH $.05361 $.04728 $.06510
200KWH/KW) $.13198>3000KWH $.02567
$.04891
(Additional
KWH)
4 3 1/2 6 7
$.065908 $.04307 $.04307 $.05699 $.01683 $.04780
2. FUEUPOWER Adjusted Non-contract Non-contract Adjusted Quarterly
ADJUSTMENT CHARGE Monthly customers** customers** Quarterly
3. PURCHASED POWER
CHARGE $.00571
4. REGULATORY NA $.000492 $.000492 $.000492 $.000492 $.000492
CHARGE
TOTAL CHARGE/KWH *** $.147718/ $.112052 $.1470021 $.088862 $.070932 $.15671* $.113392
(1+2+3+4) $.114818 $.132472
2 1
DEMAND CHARGE/KW*** $14.49 $7.7386 $7.7386>10KW $11.83 $13.85 $10.79 $5.27
* Includes Fuel & Purchased Power & Regulatory Charge
** Not Included
*** Ranked Highest to Lowest Charges (Black - Higher Than Seward, Blue - Seward & - Lower Than Seward)
6
TABLE le: INDUSTRIAL OR SEWARD SPECIAL CONTRACT RATES ELECTRICITY RATE
COMPARISON (JULY 2011 RATES)*
INDUSTRIAL HOMER GVEA SEALIFE ICICLE AKRR
CONTRACT CONTRACT CONTRACT
CUSTOMER CHARGE $1,250.00 $295 $31.50 $33.08 $33.08
(MONTHLY)*** 1 2 3 3 3
1. ENERGY $.06601 $.02221 $.00821 $.00821 $.04011
CHARGE/KWH*** 1 3 1 2
2. FUEUPOWER
ADJUSTMENT $.065908 $.065908 $.065908
CHARGE Monthly Monthly Monthly
$.04307
3. PURCHASED Non-contract
POWER CHARGE customers**
4. REGULATORY
CHARGE $.000492
TOTAL $.066502 $.13164* $.074118 $.074118 $.106018
CHARGE/KWH***
(1+2+3+4) 1 1 - 2
DEMAND $20.2753 $17.27 $11.85 $11.85 $11.29
CHARGE/KW*** 1 2 3 3
* Includes Fuel & Purchased Power & Regulatory Charge
** Not Included
*** Ranked Highest to Lowest Charges (Black - Higher Than Seward, BI ue — Seward &
Than Seward)
7
TABLE lf: MONTHLY BILL COMPARISON (RESIDENTIAL) (BASED ON 600KWH/MONTH)
CITY EXAMPLE ELECTRICITY BILL* $/% Difference** RANKING***
SEWARD $16.54 + ($.164918 x 600) = $115.49 2
HOMER NORTH
KACHEMACH BAY $11.00 + ($.146712 x 600) = $99.03 -$16.46 (-14%) 4
HOMER SOUTH
KACHEMACH BAY $11.00 + ($.150602 x 600) = $101.36 -$14.13 (-12%) 3
CHUGACH $8.00 + ($.134492 x 600) = $88.70 -$26.79 (-23%) 6
ML&P $6.56 + ($.115882 x 600) = $76.09 -$39.40 (-34%) 7
GVEA $17.50 + ($.19734 x 600) = $135.90 +$20.41 (+18%) 1
MEA $5.65 + ($.150732 x 600) = $96.09 -$19.40 (-17%) 5
* Customer Charge + (Total Charge/KWH x # KWH) = Monthly Bill
** Compared to Seward
*** Ranked Highest to Lowest Bill (Black - Higher Than Seward, Blue — Seward & Red — Lower Than Seward)
8
TABLE lg: MONTHLY BILL COMPARISON (SMALL GENERAL SERVICE) (BASED ON
1500KWH/MONTH)
CITY EXAMPLE ELECTRICITY BILL* $/% Difference** RANKING***
SEWARD $33.08 + ($.180118 x 1500) = $303.26 5
HOMER NORTH $150.00 + ($.112052 x 1500) +
KACHEMACH BAY ($7.7386 x 25) = $510.54 +$207.28 (+68%) 1
HOMER SOUTH $40.00 + ($.147002 x 1500) + $7.7386
KACHEMACH BAY x (25 - 10) = $376.58 +$73.32 (+24%) 2
CHUGACH $17.00 + ($.114392 x 1500) = $188.59 -$114.67 (-38%) (i
ML&P $12.88 + ($.112822 x 1500) = $182.11 -$121.15 (-40%) 7
GVEA $20.00 + ($.19655 x 1500) = $314.83 +$11.57 (+4%) 3
MEA $5.65 + ($.113392 x 1500) + ($5.27 x
25) = $307.49 +$4.23 (+1%) 4
* Customer Charge + (Total Charge/KWH x # KWH Used) + (Demand Charge/KW x KW) = Monthly Bill
** Compared to Seward
*** Ranked Highest to Lowest Bill (Black - Higher Than Seward, Blue — Seward & — Lower Than Seward)
9
TABLE lh: MONTHLY BILL COMPARISON (LARGE GENERAL SERVICE - SECONDARY) (BASED
ON 21,000KWH/MONTH & 50 KW)
CITY EXAMPLE ELECTRICITY BILL* $/% Difference** RANKING***
SEWARD $33.08 + ($.147718 x 10,000) +
($.114818 x 11,000) + ($14.49 x 50) =
$3,497.76
HOMER NORTH $150 + ($.112052 x 21,000) + ($7.7386
KACHEMACH BAY x 50) = $2,890.02 -$607.74 (-17%)
HOMER SOUTH $40 + ($.147002 x 3,000) + ($.132472
KACHEMACH BAY x 18,000) + ($7.7386 x 50 - 10) =
$3,175.06 -$322.70 (-9%)
CHUGACH $55 + ($.088612 x 21,000) + ($11.45 x
50) = $2,488.35 -$1,009.41 (-29%)
ML&P $44.15 + ($.072982 x 21,000) +
($12.33 x 50) = $2,193.27 ' 1,304.49 (-37 c'
GVEA $30 + ($.15671 x 21,000) + ($10.79 x
50) = $3,860.41 +$362.65 (+10%)
MEA $13.37 + ($.113392 x 21,000) + ($5.27
x 50) = $2,658.10 -$839.66 (-24
* Customer Charge + (Total Charge/KWH x # KWH Used) + Demand Charge/KW x #KW = Monthly Bill
** Compared to Seward
*** Ranked Highest to Lowest Bill (Black - Higher Than Seward, Blue— Seward & — Lower Than Seward)
10
TABLE li: MONTHLY BILL COMPARISON (LARGE GENERAL SERVICE - PRIMARY) (BASED ON
21,000KWH/MONTH & 50KW)
CITY EXAMPLE ELECTRICITY BILL* $/% Difference** RANKING**
SE WARD $33.08 + ($.147718 x 10,000) +
($.114818 x 11,000) + ($14.49 x 50) =
$3,497.76
HOMER NORTH $150 + ($.112052 x 21,000) + ($7.7386
KACHEMACH BAY x 50) = $2,890.02 -$607.74 (-17%)
HOMER SOUTH $40 + ($.147002 x 3,000) + ($.132472
KACHEMACH BAY x 18,000) + ($7.7386 x 50 - 10) =
$3,175.06 -$322.70 (-9%)
CHUGACH $55 + ($.088862 x 21,000) + ($11.83 x
50) = $2,512.60 -$985.16 (-28%)
ML&P $159.55 + ($.070932 x 21,000) +
($13.85 x 50) = $2,341.62 -$1,156.14 (-33%)
GVEA $30 + ($.15671 x 21,000) + ($10.79 x
50) = $3,860.41 +$362.65 (+10%) 1
MEA $13.37 + ($.113392 x 21,000) + ($5.27
x 50) = $2,658.10 -$839.66 i
* Customer Charge + (Total Charge/KWH x# KWH Used) + Demand Charge/KW x #KW = Monthly Bill
** Compared to Seward
*** Ranked Highest to Lowest Bill (Black - Higher Than Seward, Blue — Seward & Red — Lower Than Seward)
11
TABLE lj: MONTHLY BILL COMPARISON (INDUSTRIAL & SEWARD SPECIAL CONTRACTS)
(BASED ON 100,000KWH/MONTH AND 700KW)
CITY EXAMPLE ELECTRICITY BILL* $/% Difference** RANKING***
SEWARD SEALIFE $31.50 + ($.074118 x 100,000) +
CONTRACT ($11.85 x 700) = $15,738.30
SEWARD ICICLE $33.08 + ($.074118 x 100,000) +
CONTRACT ($11.85 x 700) = $15,739.88 +$1.58 (0%) 4
SEWARD AKRR $33.08 + ($.106018 x 100,000) +
CONTRACT ($11.29 x 700) = $15,837.88 +$99.58 (+1%) 3
HOMER $1,250 + ($.066502 x 100,000) +
($20.2753 x 700) = $22,092.91 +$6,354.61 (40%) 2
GVEA $295 + ($.13164 x 100,000) + ($17.27
x 700) = $25,548 +$9,809.70 (+62%) 1
* Customer Charge + (Total Charge/KWH x # KWH Used) + Demand Charge/KW x #KW = Monthly Bill
** Compared to Seward Sealife Contract
*** Ranked Highest to Lowest Bill (Black - Higher Than Seward, Blue — Seward & ecl — Lower Than Seward)
12
TABLE 1k: SEWARD RESIDENTIAL MONTHLY RATE COMPARISON (5 AND 10% RATE INCREASE)
RESIDENTIAL 2011 2011 +5% NEW RATE 2011 + 10% NEW RATE 2011 + 10% + NEW RATE
CURRENT RATE RATE 5%
RATE INCREASE _ INCREASE
CUSTOMER
CHARGE $16.54 $.827 $17.37 $1.65 $18.19 $.9095 $19.10
1. ENERGY
CHARGE/KWH $.09901 $.0049505 $.1039605 $.009901 $.108911 $.005455 $.1143565
2. FUEL ADJUST $.065908 $.065908 $.065908 $.065908 $.065908
CHARGE/KWH* Adjusted Adjusted Adjusted Adjusted Adjusted
Monthly Monthly Monthly Monthly Monthly
TOTAL
CHARGE/KWH** $.164918 $.1698685 $.174819 $.180265
* July 2011 Fuel Charge
** Energy Charge + Fuel Adjustment Charge
13
TABLE 11: SEWARD SMALL GENERAL SERVICE MONTHLY RATE COMPARISON (5 AND 10%
RATE INCREASE)
SMALL 2011 2011 +5% NEW RATE 2011 + 10% NEW RATE 2011 + 10% + NEW RATE
GENERAL CURRENT RATE RATE 5%
SERVICE RATE INCREASE INCREASE
CUSTOMER
CHARGE $33.08 $1.65 $34.73
$3.31 $36.39 $1.82 $38.21
1. ENERGY
CHARGE/KWH $.11421 $.0057105 $.1199205 $.01142 $.125631 $.00628155 $$.13191255
2. FUEL ADJUST $.065908 $.065908 $.065908 $.065908 $.065908
CHARGE/KWH* Adjusted Adjusted Adjusted Adjusted Adjusted
Monthly Monthly Monthly Monthly Monthly
TOTAL
CHARGE/KWH** $.180118 $.185829 $.191539 $.19782055
* July 2011 Fuel Charge
** Energy Charge + Fuel Adjustment Charge
14
TABLE lm: SEWARD LARGE GENERAL SERVICE MONTHLY RATE COMPARISON (5 AND 10%
RATE INCREASE)
LARGE 2011 2011 +5% NEW RATE 2011 + 10% NEW RATE 2011 + 10% + NEW RATE
GENERAL CURRENT RATE RATE 5%
SERVICE RATE INCREASE INCREASE
CUSTOMER
CHARGE $33.08 $1.65 $34.73 $3.31 $36.39
$1.8195 $38.21
1. ENERGY $.08181/ $.0040905/ $.0859005/ $.008181/ $.089991/ $.00449955/ $.09449055/
CHARGE/KWH $.04891 $.0024455 $.0513555 $.004891 _ $.053801 $.0026905 $.05649105
2. FUEL ADJUST $.065908 $.065908 $.065908 $.065908 $.065908
CHARGE/KWH* Adjusted Adjusted Adjusted Adjusted Adjusted
Monthly Monthly Monthly Monthly Monthly
TOTAL $.147718/ $.1518085/ $.155899/ $.16039855/
CHARGE/KWH** $.114818 $.1172635 $.119709 $.12239905
DEMAND
CHARGE/KW $14.49 $.7245 $15.21 $1.45 $15.94 $.797 $16.74
* July 2011 Fuel Charge
** Energy Charge + Fuel Adjustment Charge
15
TABLE ln: SEWARD RESIDENTIAL: MONTHLY BILL COMPARISON (5 AND 10% RATE INCREASE)
(BASED ON 600KWH/MONTH)
RESIDENTIAL EXAMPLE ELECTRICITY BILL* TOTAL EXAMPLE INCREASE
Current Rate $16.54 + ($.164918 x 600) = $115.49
5% Increase $17.37 + ($.169869 x 600) = $119.29 $3.80
10% Increase $18.19 + ($.174819 x 600) = $123.08 $7.59
10% + 5% Increase $19.10 + ($.180265 x 600) _ $127.26 $11.77
16
TABLE lo: SEWARD SMALL GENERAL SERVICE: MONTHLY BILL COMPARISON (5 AND 10%
RATE INCREASE) (BASED ON 1500KWH/MONTH)
SMALL GENERAL EXAMPLE ELECTRICITY BILL* TOTAL EXAMPLE INCREASE
SERVICE
Current Rate $33.08 + ($.180118 x 1500) = $303.26
5% Increase $34.73 + ($.185829 x 1500) = $313.47 $10.21
10% Increase $36.39 + ($.191539 x 1500) = $323.70 $20.44
10% + 5% Increase $38.21 + ($.197821 x 1500) = $334.94 $31.08
17
TABLE 1p: SEWARD LARGE GENERAL SERVICE: MONTHLY BILL COMPARISON (5 AND 10%
RATE INCREASE) (BASED ON 1500KWH/MONTH) (BASED ON 21,000KWH/MONTH & 50KW)
SMALL GENERAL EXAMPLE ELECTRICITY BILL* TOTAL EXAMPLE INCREASE
SERVICE
Current Rate $33.08 + ($.147718 x 10,000) +
($.114818 x 11,000) + ($14.49 x 50) =
$3,497.76
5% Increase $34.73 + ($.1518085 x 10,000) +
($.1172635 x 11,000) + ($15.21 x 50)
= $3,603.22 $105.46
10% Increase $36.39 + ($.155899 x 10,000) +
($.119709 x 11,000) + ($15.94 x 50) =
$3,709.18 $211.42
10% + 5% Increase $38.21 + ($.160399 x 10,000) +
($.122399 x 11,000) + ($16.74 x 50) =
$3825.59 $327.83
18
JOHN BIRD'S RECOMMENDATIONS FOR DISCUSSION:
1. City does not renew and/or renegotiate the three(3)special contracts.
2. City raise rates in 2012 and 2013 to meet what was requested for 2010 & 2011,plus an additional percent annual rate
increase over a 5-year period to establish adequate cash reserves.
3. Continue adjusting electric rates annually based on CPI.
4. Determine reason/reasons City line loss rate is higher than national average and implement reduction program.
5. Establish service and special assessment districts as specified in the City Charter.
6. Replace all analog meters with digital meters and establish phased program for conversion to an automated metering
system.
7. Charge customer or customers for all service extensions, regardless of cost.
8. Establish phased line replacement program.
9. Effective 1 January 2012 apply the annual$61,000 SMIC dock bond payment towards replacement of the electric
department's capital equipment and infrastructure.
10. City accelerate implementing energy conservation measures internally (energy efficient lighting,equipment,policies,etc.)
now.
11. City establishes a usage rate(KWH)on all service classes with usage above assessed a higher energy charge.
12. Begin building a cash reserve to replace fully depreciated equipment & infrastructure and to fund matching grants and/or
low interest loans.
13. Expand capital equipment and infrastructure replacement plan to 10 years and annually fund 100% depreciation.
14. Contract now for a formal rate study and at least every 10 years.
15.Adopt and abide by recommendations future rate study recommendations.
19
7/29/2011
ofse q
City Parking Department
Fees, Permits, Free Parking
Boat launch under Harbormasters' Dept
Outline : Paid Parking
Cash Balance, History
Capital Needs
Customer-Friendly
Basic Questions
Daily fees
Season Passes
Free Parking Winter Sunrise over Chamber of Commerce
Compare other Cities
1
7/29/2011
Is
Parking Fund Cash Balance
Parking Fund Cash Balance History
Parking Enterprise Fund-Cash Balance
Balance at December 31,200X
Parking Ford MRRF 8 months'
Cash Cash Cash Total
2000 65,953 - 5.4 '5 65,953
2001 96,173 - 13.6 'S 96,173
2002 125,368 - 17.2 '5 125,368
2003 147,502 - 19.1 'S 147,502
2004 186,486 - 17.2 '5 186,486
2005 234,283 - 20.6 'S 234,283
2006 278,695 - 23.5 '5 278,695
2007 325,637 - 25.0 'S 325,637
2008 430,786 - 36.1 'S 430,786
2009 412,074 - 34.5 'S 412,074
2010 387,338 - 25.7 '$ 387,338
500.000 --
450,000
400,000 ■
350,000NMI ■ ■
300.000 ■ ■ .
200,000 • •• •• •
150.000
■MRRF
100.060 ill I, . . •M RE Fund 50.000 111•111• •'• • •• •• •• •• •
Parking Fund Capital Needs
PARKING ENTERPRISE FUND-Capital Infrastructure Needs
Critical Risk High Risk Moderate Risk New Total
2012 150,000 50,000 150,000 36.000' 386.000
2013 150,000 95.000 245.000
2014 150,000 70,000 220,000
2015 - 10,000 250.000 260.000
2018 - - 600.000 600.000
2017 - -
2018 - - 600,000 600,000
2019 - - 300,000 300,000
2020 - 46,000' 46,000
2021 - 46,000' 46,000
$ 150,000 $ 50,000 $ 460,000 $ 2,043,000 $2,703,000
700,000 ------
600,000
500,000
400,000
300,000
■New
200,000 •Moderate Risk
100,000 •High Risk
0 M •Critical Risk
o'' o� 04'' q° 4?o'� oa o4' 09 b> o'p
2
7/29/2011
Critical Needs 2012-2017
Highly Likely to fail in next 5 years
► Center lot patch, seal, stripe = est. $ 1 50,000
(this is the Center lot between Ray's and KFT)
Note: Public Works Department suggests patching rather than paving;
this saves $200,000.
RFP is going out in August with goal of completing before end of
October, or next spring depending on RFP responses
High-Risk Needs 2012-2017
Highly Likely to fail within next 5 to 10 years
,Indoor parking needed for two electric-powered
trucks = est. $50,000
Note: Must be done in 2012 due to demolition of
Ray's library garage building currently housing
trucks. Requires electricity for heat and monthly
battery recharge.
3
7/29/2011
Moderate Risk Needs 2012-2017
Continuous Increasing Cost to Maintain and Operate
Note: No mention of downtown parking. No
parking lots. Downtown parking-related
infrastructure is managed by Streets budget in
General Fund.
❑North lot patch, seal, stripe $1 50K
❑South lot patch, seal, stripe $150K
UPermit (employee) lot seal and stripe $100K
UNE lot seal and stripe $50K
❑Parking office/chalet replacement - $10K
❑Total: = $460,000
to be paid from MRRF
► Automated Pay Stations, $1 8K ea
NE Lot - 1
� SHU - 1
Replace existing Lukes = $46K/year in 2020
4
7/29/2011
Capital Needs (new) 201 7-2020
and beyond
LINE lot - $41 5K = pave $250K; asphalt maint $95K;
fence $50K; gravel $20K
❑North harbor lot repave - $600K
❑South harbor lot repave - $600K
❑Employee Permit lot repave - $300K
Customer Friendly Items
► Lukes
• Automated Pay Stations in all parking lots
• solar-power, cell-phone connection
► Credit cards
• About 2/3 customers pay by credit card
► People love the electric-powered trucks!
► Luke for Harbor Uses
loaning Harbor 1 Luke for launch fees
► Combo passes
,, pay for launch & park in one transaction
5
7/29/2011
Q: Do Parking Revenues cover
expenses?
► Yes, at $10. Revenues to Parking Enterprise
Fund only, not shared to General Fund
► Yes. Revenues after expenses allow funds for
operations and capital improvements. At
$ 10/day, approx. $50-$ 100K surplus/yr. for
capital
► Yes. Parking Enterprise Fund is healthy:
- We'll bring in $270K
- We'll spend $220K including PILT
CAFR states $412K FY10
Q. Recommend fee increase?
► Fee increases are NOT recommended, although
current fees will not cover all future capital needs.
► Admin recommends retaining $ 10 daily rate per
site, per day.
► Admin recommends current rates $50 for Slipholder
& Harbor Area Employee permits.
► Admin recommends $75 to $ 100 for Visitor and
Vehicle-with-Trailer permits.
6
7/29/2011
F:er
mrir„„r1
► da Y I�
"day" ends at midnight
Recommend "day" = 24 hours
• If we changed to 'day' = 24 hours, some customers
would pay $5 per day.
Most communities: $5 day, per phone survey
•
SPECIAL NOTE -
W 4 are QUr customers?
1 Day: 950
2 days: 40
South lot 3 days: 3 0
June snapshot
1,000 customers
More: 5
7/29/2011
Season Passessti9
9"0
May1 through Sept 30
► Slip Holder Pass $ 50
► Harbor Area Employee $ 50
► Vehicle W/Trailer $75
• Increase to $100
► Visitor's: $ 75
• Increase to: $100
► If a space = $ 10, pay 8 days, then free
► Commercial Vehicle = 0 @ $ 350
► Downtown Resident Parking = free
Where is Free Parking?
► Center Lot: 2 hours Maximum
► Cannot pay for extra time
Zero "Commercial Vehicle" sold
Most abused lot
• Scores of tickets written, 50% paid
• Tickets = $35 (pay w/in 10 days = $25)
• Seasonal permits not allowed
• Consider an escalating fee or penalty
r �
8
7/29/2011
Where is Free Parking?
"The Sliver" by USCG: 2 hours maximum
Downtown Parking
Some street parking in the Harbor
30 min, no RVs, 2 hour
"1 5 minute zone" in front of Harbormaster's
The Center Lot
Compare Daily Fees :
. 411
► Free Parking: Cordova, Valdez, UAS,
Petersburg, Sitka /,' „\:
► $ 3/day: Fairbanks Airport, UAF
►
$5/day: Juneau, Homer, Cooper Landing, Kenai
River, Kenai Airport, AK State Fairgrounds
► $ 10 /day: Whittier, Seward
► $ 1 or $2 /hour: Juneau, Anchorage, UAA Parking
9
7/29/2011
Compare Permit Passes
► $ 10 month: Seward ($50/5 months)
►
$ 15 month: Sitka
► $20 per month: Cordova
► $25 per season: AK Fairgrounds
► $40 seasonal: Cooper Landing
► $75 per month: Juneau
► $25 - $ 1 1 5 month employee permit: Anch
► $130 - $750 UAF student to "gold" annual
► $220: Whittier annual
► $230: season Homer
► $250: UAA annual
*Many communities offer "launch + parking combo"discount
. . . end
10