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HomeMy WebLinkAbout03202018 City Council Laydowns See./ 0/2018 Lar6Ce(71:6---) (&r1/144/1 City of Seward Tariff Discussion Tuesday,March 20,2018 1 Goals: Calm fears about rates increasing ■ Under staff's proposal, rate increase as Council intended (2.1% W/S) REPEAL&REPLACE resolutions will fix the issues Separate fact from fiction Correct affected bills before this month's bills go out Explain the problem and Plan to fix Long-term solutions • Commission Water&Sewer Classification and Rate Study to address Seward's changing demographic and economic conditions(i.e.B&Bs,nightly lodging,hotel/motel) • Last Water/Sewer Rate Study-1993 Tuesday,March 20,2018 2 1 3/20/2018 1.1 0. Council's intent,public expectation: _,j.' • Council's intent which staff will follow: • increase rates for Water&Sewer by only 2.1% l{ • increase Electric rates by 2.1%(City)with corresponding decrease of approx.2.0%(CEA); combined with amend seasonal rate;new billing format • do not eliminate metered Water and Sewer rates for existing metered • do not increase any customer's Sewer bills based on billing system historical error • do not reclassify currently metered customers back to ERU rates • Staff aim is to amend Tariffs to accomplish that intent • Staff will revise last month(February)bills to meet Council intent,prior to March bills going out Tuesday,March 20,2018 3 iiii 6 \..,A \ Summary of the Problem: Jl.. JJ • Sewer LGS customers affected by billing system historically failing to match �iTariff;RESCIND and REPLACE to fix (" • Sewer SGS customers affected by definitions in the Tariff;RESCIND and REPLACE t v YC3 s' • Restore LGS non-metered tariff verbiage;affects only non-metered LGS \S zik(151) customers;clarifies laundromat and ASLC will not be charged ERU rates ("p ' RESCIND and REPLACE to fa 0 • Electric bills affected by the previous read date will be adjusted to slightly reduce / (� rate for consumption between 1/10/18- 1/14/18;no resolution required to fa.Rather,if action is contemplated,stiff recommends work session with Mr.Hubbard to review the seasonal rate decision. ,1 Q/ —V V� ^rho // oi: Li i cl�� 0 Tuesday,March 20,2018 a 2 3/20/2018 So, what happened (Sewer - LGS)?: 1)Historical billing errors were discovered by staff,AFTER billing: • Previous Tariff rates for sewer were not in billing system Large GS Metered: 2013 2:14 2015 2016 2017 Class D ,]ass L. Clax D Class D ,lass Tariff filled Tariff tilled Tariff Bled Tariff Bled Tariff Bled First 10Kpitons 10.73 6.68 11.29 7.03 11.88 7.40 12.39 7.72 12.94 806 Next40K 8a8ons 859 5.35 9.04 5.63 9.51 5.92 9.92 6.17 10.36 6.44 Next 50K gallons 7.17 4.44 7.54 4.67 7.93 4.91 827 5.12 863 5.35 Nevi 1:36 gallons 6.47 4.00 6.51 4.21 7.16 4.43 7.47 4.62 7.80 4.82 Next Via.,K gallons 4.16 1.98 4.38 2.08 4.61 2.19 4.81 2.28 5.02 2.38 Next 5,6l.gallons 4.16 1.98 4.38 2.08 4.61 2.19 4.81 2.28 5.02 2.38 AN additional gallons 4.16 1.98 4.38 2.08 4.61 2.19 4.81 2.28 5.02 2.38 IO• 2.1%rate increase was expected to raise rates to$8.23 but raised rates to $13.21 (yellow) Tuesday,March 20,2018 5 What's the solution (Sewer LGS)?: • • Affected all sewer customers with metered water • Resulted in metered SEWER rates unexpectedly increasing> 64%- 115% • SOLUTION: • "Repeal AND Replace" • Metered sewer would change to$8.23 48.062onrate+2.1e.� • Consistent with Council intent • Consistent with public expectations • Do not repeal tariff without replacing with correction or customers will be billed>64% higher than Council and public expected. Tuesday,March 20,2018 6 3 3/20/2018 End Result- Sewer LGS sewer 1 his will`permanently'eliminate historical Sewer Tariff differential where LGS metered sewer rate is currently 64%415%higher than SGS metered sewer rate. • LGS and SGS metered customers will pay the same rate • If Tariff is ONLY rescinded(and not replaced),rates return to 2018.Re3114..11. 2018 Revised Large GS Metered: 2016 2017 Propose o Rescind Proposed to Replace CNN D Cass t 1.s r Cass t• Tariff Ned Tariff Riled Tariff 5,rha, Tariff %Chem. I2.1°,' cease G&W*NV abet (a 114d 04•21/6 hist l t.gallons 12.39 7.72 12.94 106 $ 423 2.1% Next 4:./.gallons 9.92 6.17 10.36 6.44 5 6.58 2.1% Neat 54 gallons 127 5.12 163 5.35 - _ $ 5.46 2.1% Nnrt1003 gallons 7.47 4.62 7.80 4.82 7.9. 7,-... 5 4.92 2.1% Next 3-01!aeons 4.81 2.28 5.02 2.38 5.1: t.13:-'_ 0 2.43 2.1% Next`,--1,galla,, 481 2.28 5.02 2.38 5 1: 5.1:. 5 2.45 2.1% H additional gallas 4.41 228 5.02 238 ... '... $ 2.43 21% Solution addresses concerns from LGS customers such as Alaska Sealife Center, Suds-n-Swirl;rates will rise only 2.1% - Tuesday,March 20,2018 7 So,what happened (Sewer- SGS)?: i3' 2)Staff discovered historical classification errors in billing system which allowed ERU(flat rate)customers to be billed metered rates . Tariff originally proposed to eliminate SGS metered rates,expecting affected customers to be minimal .N.MOWN 11non 2017 Resolution 2015-090 ............a _ iiiillaiaMit'rrnoueavtrn ers.swrnare� yiihyar i. 7T ....R...MI arm u>rrryer ' NINARNIN EL :"i:. 1! wrr..1.w n mtlim Isom at_ `. ere�or I lbw I ....Om ufd,xYm...lnt I HOW KB. ......ew.....�.�..-..............�, I .1.1....10.111... 40. 1W. ti Tuesday,March 20,2018 8 4 3/20/2018 So, what happened (Sewer - SGS)?: %' Result—SGS sewer rates increased 64%+ • Original Tariff change intended to clarify SGS customers s/b billed ERU Customers&Council prefer to retain metered rates for SGS metered customers,so staff is preparing amendment to Sewer Tariff to retain metered rates Tuesday,March 20,2018 9 4 Solution (Sewer SGS): - , • Do not repeal tariff without replacing with correction;"Repeal AND Replace" - Restore metered rates to Class A,B,C;rates would change to$8.23 ($8.06 2017 rate+2.1%) ICeiba..l Sewage Dbxberxed per Mouth I _ a•TA■.c GnYD Fur 10.000 Callen Dy 2.4‘94 3.4,:_42y4 Nen 40.000 Callous $65x44.14 /42.2-6404. ` Next 50.000 GJIos S•1NINi 1.14466.7. Nen 100.000 G.Im. 11 ossl.aa SI.'''%-+u All Add/maul Cillos S,1...._ s. Revise tariff to exp/icit/y state that all currently metered customers may remain metered Tuesday,March 20,2018 10 5 3/20/2018 0 Solution (Sewer SGS) cont'd?: ` ` , • Consistent with Council intent • Consistent with public expectations • Will address concerns from hotels/motels/multi-unit residential(Class A and B customers with currently installed meters),ensuring they maintain metered rates Tuesday,March 20,2018 11 Electric Tariff •-=- • Reduced seasonal rate variation • Previous 25°.winter rate decrease based on entire Electric bill(energy+fuel) • Current 15°o winter rate decrease based only on Energy charge • Added a minimum usage fee of$28.75(flat)to customers who have access to power but are gone for winter, • Separated entire Chugach costs onto one line on bill(COPA) • Separated entire City costs onto one line on bill(Seward Utility Charge) • No longer Fuel Adjustment Factor(except Special Contracts) • A small error relates to the timing of the rate change,and will be adjusted by Billing Department prior to issuing bills at the end of March;affects any consumption between the prior read date and 1/15/18 Tuesday,March 20,2018 12 6 3/20/2018 2018 Electric Tariff ELECTRIC RATESF CHARGES Residential base rate decreased from RATES FOR ELECTRICAL rowER Ry CLASS OF SERSICE $0.13526 to$0.09376. cT..ws._ E.w�oliMILLC,..T. nw.°..CUM. .... Summer rate decreased from$0.19524 In Al Qomto$0.11533 Rmd,mi.l Ram raw S°..agk°•.,,n s°°er. 500.°41.,1I3:140,45WA4.,:,,,, Winter rate decreased from$0.0810 to 5,Awe 5.5•544A 2IAA4 $0.07970 w" uW. Small Galena - SGS base rate decreased from SR.;u<(I...dam ss Row rot WW4Wk°E1u $0.14900 to$0.10734 kW) Sanzwe SOOA.°MN'A IC-0.Q Summer rate decreased from$0.16916 WMR S0.ANIIf.,1M11rA N WA u°'s to$0.12344 "rNi°°i'°^ 5.46.109I0,AsNs WA 4,-I41I11k Winter rate decreased from$0.12381 6.211W1C! JlriAlk(I„w0 - to$0.09017 LRslMnnd mom) A ""R SO A-O+v',IA..•bni 4W.,, 2.1C Part of the rate decrease is due to *W'k1 $9.47(17S*Ansi removing CEA energy charge out of the 1 '.T'AwO«oai Seward Utility Charge,and onto the Yi11 NI, WASOkNII°0°w.Wl COPA line item,so that line increases. `t"°” a�",, OR of The magnitude of that energy charge is sR°R LIANAw...w,>y,� N'S 6.14.1a2different for each rate class. Tuesday,March 20,2018 Added COPA as a separate line on the 13 0 Electric Tariff Why seasonal rates? • Council was asked to provide rate relief(lower rates)to year-around residents in winter; and 4 • Rate relief(lower rates)to small businesses trying to make it through winter • Assess those leaving town all winter and vacating their homes, not contributing to costs of operating utility • To achieve lower winter rates requires higher summer rates to offset • Billing Dept has model to input your account to show impact of rate increase to 4 your specific account t,_ Seasonal rates • Specifically benefits low-income residents • Some flexibility for residential customers to control their own consumption in summer • Customers with higher consumption in summer will pay more Rescinding Tariff would return us to significantly higher summer rates which caused rate shock last summer Staff recommends a work session to discuss Mr. Hubbard's findings with him before considering any Tariff changes due to unintended impacts Tuesday,March 20,2018 14 Ii 7 3/20/2018 Electric Tariff CITY OF SEM ARD.ALASKA RESOLUTION MOM A HE OL1 ROS OF THE CITE COUNCIL OF THE CTA OF SEN ARO.ALASKA.AMENDING THE E1l)CRIC RATES AND CHARGES.REDUCING SEASONAL RATES.AND ADJCSTI.NG RATE.TO REILE(T SEN ARD ELECTRIC slT CHARGE. COM O,EIMER ADJUSTMENT AND CUSTOMER CHARGE.FOR 1018 AND AIS NIIEREAS.de Sn.SCin CaaRR amlcad oE.S.,p.IJ H TS SAS NTim b de p,Nm'e oradimnq tribal Mamma r mammal as+K M A,Flora Coln,, N HFAEAN AI('aml Sni Anna.in the FMnW.mroa0C lk CJecuie INN,to mata.CS .,N SRiRRIhpltead IAn,Ja Me NJea d 2.1\N 2018.chirpnipk 010,bra CM.ab 104 dame N MI1Iroa at bmase olG.la.E IS 18.Coram NM Mee lartar in 1010,ad WHEREAS.Fa(oral Sada AR n n N drr hsr.mare or 1k ai*nn and nmll Maas mars Mdr S,WS Gam Unlb,m.Aae an RAaoaal raw r WHEREAR.Ow Cmullaetla niaaemom110m mraaraads bomb baba mora Mamma rol.amwl nab or8e Marin units Able media sireMbrNrM Naas.And WHEREAS.Rio el Caws.wows ebaap nit Elan TARN ARRA]keen in"...N Rasa R Maras 201E.0Rai.t mnmy It.1018.N WHEREAS,Do CmalMrtha aim15 rbarpr.noir Mom-MH m WNkdboao A-ENNINF Roma CTREn 201r auk drawl,.Moor I r,1010 NOW.1111J VDRL REnRESot.\'ERRS THE CM'COERCE,.Of THE CRY OF SEWARD.ALASKA is S HWA L Maim Jaaml 15.2011 rk SomdC,5 Camnl haat mon ea dlegrd E..Tal,,amr dims as ambd`m as-Elam Roel CS.. 2010- Tuesday, 01rTuesday,March 20,2018 1 Calculation of COPA CDtWCIt MMI IIZCT1K.E110a.ttO'I1 LAY. 0111.11/A.AElONAGLL AA 5111•!1N CHUG"Liiri COPA is calculated by taking M•I SN.rdN FAX AO AIN)! MUM A1d8RAY II/MI entire adjusted Chugach bill,and Cay r✓IM lmdae bow lard 1.1•1• dividing by total kilowatt hours r:lea cmc Orweav w: SLS.I211 sold by Seward Public Utilities, P.O.Lala ...mow Sr 14r»11!1141•1 Swell.Yak FMN resulting in a per kWh COPA rate. 1111'!C/I kwNEYtaR 1IHR There is no markup by the City. RrErew Him IlmPamas I ea11 RSlasya 20a•20MM CM.IMIN ANNOY k rm.111C DR/SWRNE s IR baRas.•1a.alma is may iYRdamuDIonserl MH1R Adjustments may include prior R„aiNSA Eva Rasa Cir year quarterly fuel cost true-ups Mom 2 sm. HM11 MW w as allowed by the Regulatory Commission of Alaska,removal Das.rC I. I Jaw eK 1122.1 IMMO 1J of fuel costs billed to Special a.resr. ulaO ENS 1.022» LAUM.R Contracts,etc. ERE Rol WHIRRS pm Om.lmmT 211E un.1MN sial E.n_1tM COPA applies to all customers ARr.Imp AasasraaRD LAW C, .l 1:Oa' Cls MOOexcept those with Special Contracts. Instead,they pay Fuel AVM WHA TrrlkaF AR.EASE DSR 1•l' GMS %SUSI MIO Adjustment Factor. Tr ARA.Da MIAOW 'Palm RA=wily WA*FT RHI Pad,Leo p.m rr lay I,RI•WHO Am R.Ri pd RNmaas 144aas dam Yr dm INYJ.Jfr9A lO.MI ,1l IOeJaa arra,0.0•0/Is a+S AEA WAS l.sau4 War lm. Tuesday,March 20,2018 16 8 3/20/2018 0F Calculation of FA CHMACif ELECUIC AiWOA tIa.:TY. ��il >•.aPDX 1NIN ..YMOSaGE..1r N$J$JIN �r1 Fuel Adjustment Factor(FAF) INT 161-)I0i FAX(007 MJ-601' I MI11Alirg" ' applies only to customers with re/Jr.$ 01•04v D.. Menlo 1.nu Special Contracts,approved by A..:IM.hen J...w..:, 1[1.111 the Seward City Council. P.O./..,. Arrow N.. 14121/NIF)Nl Jw.A Alnr MU het 1/I FAF is calculated by taking the Sow~Elm*hunt "Fuel and Purchased Power r,...lgal any rrrom,l...1.r...,21 AA.11.,.crrNow Ar...k.b.r.my. Costs"($327,158.64 below)and II O.ilWlr...r•.Nom...6l..Y.1.,wr__.w.nbIJ^l.l dividing by total kilowatt hours toner** r., •,,,..Cal. 6114 by Seward Public Utilities, ammoC . 2 MomIIAm 1/0106 dividing in aper kWh rate. Nord amp 1 11 111 61:1: Ila m v There is no markup by the City. It 4171.601 NO 6.01271 w))1.0 Fri 6•S P.m.1...Com•Lamy Alt u2-.14 it Only two customers are currently Ye. 1.1)1:.11 under Special Contract with SPU. AI*ime Artim11.48,1.1•C..Y.Fr*0.Mil. (IN MCC AI1[CMY.rrr PS C.Y.Wry 1611 Cin le ow) am 7.11 karma. 1611/1601 '7466.•••..01,1•4111•Irr 1111 Y,Wpri 11b 1t I.A111.y Ar 141111,11 nrrw Porewor.,r Yr Y.A.•.)16.l..An ,l,a p.e.t.n1►•..At.r•r..}.lr..A.0.A.A., Tuesday,March 20,2018 17 What is to come?: ".t.,... • Council work session with Mike Hubbard to refresh seasonal discussion and review rate calculations? IResolutions for Water and Sewer to RESCIND and REPLACE Tariff to facilitate all needed changes in rates and definitions II • Staff requests RESCIND Reso.2018-008 which asked for short-term moratorium to July 1,2018 to reclass customers from metered to SGS. Additionally,staff requests Council explicitly authorize no reclass of currently metered customers to ERU pending further review by Council Tuesday,March 20,2018 18 9 3/20/2018 What is to come?: • Future classification and rate study for Water and Sewer to ensure customers only pay for what they use • Post Chugach bills online with calculations of COPA and Fuel Factor • March bills(due 4/20): • COPA lower than February(50.1137 to$0.0839) • Fuel factor lower than February(ASLC,Icicle only)($0.09626 to$0.07368) Tuesday,March 20,2018 19 10 Copper Valley Copper Valley-Valdez Chugach Electric Golden Valley Homer Electric Matanuska ML&P Seward Average 125.82 117.3 117.6 $144 $153 $125 $115 $140 $130 180 160 140 120 100 80 60 ao OK. 20CX 0 Copper Copper Chugach Golden Homer Matanuska ML&P Seward Average )8 Valley Valley- Electric Valley Electric Valdez JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Total KWH 585 725 510 490 380 540 570 480 430 500 520 530 6,260 SEWARD UTILITY CHARGE $46.57 $58.73 $41.31 $39.69 $43.81 $105.43 $111.29 $93.72 $83.95 $97.62 $85.92 $43.96 $852.00 SEWARD SERVICE CHARGE $21.00 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $21.06 $252.66 FUEL SURCHARGE $38.13 $42.53 $31.23 $32.94 $27.41 $45.15 $38.53 $30.51 $32.36 $32.82 $37.97 $41.91 $431.49 TAX $3.16 $3.67 $2.81 $2.81 $2.77 $5.15 $5.13 $4.36 $4.12 $4.55 $4.35 $3.21 $46.09 TOTAL $108.86 $125.99 $96.41 $96.50 $95.05 $176.79 $176.01 $149.65 $141.49 $156.05 $149.30 $110.14 $1,582.24 $136.08 $157.49 $120.51 $120.63 $71.29 $132.59 $132.01 $112.24 $106.12 $117.04 $186.63 $137.68 $1,530.28 $200.00 $180.00 i $140.00 I $120.00 $100.00 I $80.00 $60.00 $40.00 $20.00 $0.00 JAN FEB MAR APR MAY JUN JUL AUG SEP Oa NOV DEC --` JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC KWH 5,060,292 5,199,401 4,622,995 5,404,693 4,574,119 4,948,547 4,856,895 5,559,829 5,627,623 4,709,385 4,590,273 4,783,540 COST OF POWER $470,798 $420,383 $460,857 $448,574 $492,514 $483,191 $471,861 $466,568 $545,911 $499,699 $411,481 $477,742 $5,649,579 SEWARD CHARGES $825,976 $935,064 $964,002 $898,369 $977,151 $1,288,567 $1,202,539 $1,203,445 $1,400,848 $1,045,541 $1,148,708 $1,077,065 $12,967,275 TOTAL $1,296,774 $1,355,447 $1,424,859 $1,346,943 $1,469,665 $1,771,758 $1,674,400 $1,670,013 $1,946,759 $1,545,240 $1,560,189 $1,554,807 $18,616,854 $2,500,000 -COST OF POWER $2,000,000 -SE W ARD CHARGES -TOTAL $1,500,000 $1,000,000 $500,000 - - $0 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC KWH 585 725 510 490 380 540 570 480 430 500 520 530 6,260 COST OF POWER $19.89 $24.65 $17.34 $16.66 $12.92 $18.36 $19.38 $16.32 $14.62 $17.00 $17.68 $18.02 $212.84 FUEL SURCHARGE $38.13 $42.53 $31.23 $32.94 $27.41 $45.15 $38.53 $30.51 $32.36 $32.82 $37.97 $41.91 $431.49 COPA $58.02 $67.18 $48.57 $49.60 $40.33 $63.51 $57.91 $46.83 $46.98 $49.82 $55.65 $59.93 $644.33 USAGE&SERVICE CHARGES $50.54 $58.81 $47.84 $46.90 $54.72 $113.28 $118.10 $102.82 $94.51 $106.53 $93.65 $50.21 $937.91 TOTAL $108.56 $125.99 $96.41 $96.50 $95.05 $176.79 $176.01 $149.65 $141.49 $156.35 $149.30 $110.14 $1,582.24 $200.00 $160.00 $160.00 $140.00. I $120.00 ---" I III $100.00 ■USAGE&S ■COPA $60.00 . . . ■ ■ ■ ■ $6000 . ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ $40.00 . . . . . . . . . . . $20.00 $0.00 . . . JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 15-AUGf. 15 Sx'' 15 f». 15-NOV - 15-OEC o ti • 0 16-FEB 3 n 0 16-MAR CM n 16-APR 16-MAY Qo '11 C a I'D 16-JUN 0 «—� 0 0 or c 16-AuG m V1 r+ m 3 16-SEP g fp n 16-OCT 0 r+ T1 CIT ap L6-NOV f1 o cr r+ 16-DEC r: osio 17-JAN Qtb 17-MAR w � 17-APR w � 17-MAY w � 17-JUN a 17-JUL a 17-AUG (cvl tio.t.Tp.„7 V O 17.5fP j(9 QZcag/ Q �, / o3zo siecfit, Laye,-.0 410A-} What is an ERU? An ERU = Equivalent Residential Unit Water Tariff When designing or evaluating a water system,we 2017 Tariff vs.2018 Tariff compare non-residential and multi family water What Changed? demands to the typical amount of water a single-family residential unit uses. We use the term"equivalent residential unit"(ERU)as a basis for this comparison. - • 2017 Structures with water meters, by definition, were billed as Class D, Metered Commercial& Industrial Services to h c.m.cn ti i meta rata It the writ dile thltaDVILA kt.1141;7.1) It the t th eVue.i r.alq+rm cal to on,ert to mem lata.the auaIoma will rnaall a meter at the eustumerb cxpoxc. etcaflcr alurges till he hard on metcent uvge A cu.toim,ramex um.M Fm,metered to fixed rate htihng 2018- by adding the verbiage "if they meet the definition of a Class D customer" the city now states any Class A, B or C users that are metered are in the wrong category. S PEz.,lat L rv1 T G 0,c4.5,....t.d.) 8 03 20 C- 0 0 Agenda Statement c;0c se. Meeting Date: March 20,2018 °� _�'�o To: City Council Through: Jim Hunt,City Manager From: Kristin Erchinger, Finance Director Agenda Item: Rescind and Replace Water and Sewer Tariffs so Rates Increase 2.1%over 2017; Indefinitely Delay Reclassification of Water/Sewer Customers Previously Billed Metered Rates ;-Reduce LGS Metered Customer Rates to Equal SGS Metered Customer Rates; and Plan Total Future Revamp of Water and Sewer BACKGROUND &JUSTIFICATION: On November 27,2017,the Seward City Council passed Resolution 2017-077 amending the Sewer Tariff and Resolution 2017-078 amending the Water Tariff, with intent to raise rates only 2.1%. When the intended 2.1%rate increase went into effect,some customers saw a sewer charge increase of 33%or more. Affected customers assumed the increase resulted from reclassification of their accounts from, for example,metered rates to ERU rates;the increase did not result from a decision to reclassify any customer account but was due to historical billing and classification errors. SEWER TARIFF ISSUE Upon further investigation, it was discovered that staff did only increase rates by 2.1% over the 2017 approved Tariff. The problem however,was twofold: 1) Problem#1: Historical rates being billed to Large General Service(LGS)customers in the billing system did not match the tariff rate; rates were mis-entered into the billing system by staff. Thus, customers in LGS rate class were erroneously under-charged at the lower Small General Service (SGS) rate for many years. The differential between what should have been charged historically according to the Tariff,versus what was charged in the billing system,resulted in customers being under-billed according to the Sewer Tariff,by between 64%and 115%. 2018 ORIGINAL 2018 Revised 2016 2017 Propose to Rescind Proposed to Replace Large GS Metered: Class a class D Class o Class o Tariff Filled Tariff Billed Tariff Billed %Change Tariff %Change 2.1%increase Equal to 2017 (a) (b) above(a) Billed(b)#2.1% First 10K gallons 12.39 7.72 12.94 8.06tr, 3,21 13.21 ; ;0 5 '.23 2.1% Next 40K gallons 9.92 6.17 .36 6.44 le- : 10.58 64% 5 u.58 2.1% Next 50K gallons 8.27 5.12 /8.63 5.35 8.81 R.:: 65% $ 5.46 2.1% Next 100K gallons 7.47 4.62 i 7,P 4.82 7.96 4 - 65% 5 4.92 2.1% Next 500K gallons 4.81 2.28 5.02 2.38 5.13 5. 5 2.43 2.1% Next 500K gallons 4.81 2.28 5 52 2.38 5.1 16% y - . 2.43 2.1% All additional gallons 4.81 2.28 7 5.i2 2.38 5.13 5.13 1 .'.. 5 ` 2.43 2.1% Note that the 2017 Tariff'` haws a much higher rate for floss D than customers were being t'Biied'. Thus.when 2018 rates were increased 2.1%above the Tariff-approved rotethe result was a significant increase above the prior (incorrect)billed rate.Proposed Solution: Reduce LGS sewer tariff rates to mirror SGS sewer tariff rates,to be consistent with past(erroneous)billing practices until such time as future structural Tariff issues are addressed. 5 Proposed Solution to erroneous LGS rate: Rescind Resolution 2017-077; this will not however, correct the problem with billing of higher rates,since rolling back to 2017 approved Tariff--where Class D LGS Metered Rates are, for example, $12.94 for the first 10K gallons-would result in an increase in LGS metered sewer rates of between 64% and 115%. Therefore, staff recommends rescinding and replacing with a Sewer Tariff that will make the LGS Sewer metered rates equivalent to the SGS Sewer metered rates, which is consistent with past (erroneous) billing practices. This will ensure that LGS customers' rates increase only 2.1%over the 2017 billed rates. 2) Problem#2: In the process of preparing for the rate change, staff identified a number of customers previously charged for metered water and sewer charges, igible are.. e.. SGS customers4lekikir.by definition, billed metered rates; ,according to the tariff definitions. The 2018 original Tariff attempted to e>x y eliminating the SGS Metered Rate Class and allowing only LGS Metered Rates(see Water Tariff, which has only one metered rate class). The original intent was that be . eeti he time of the rate change and July 1, 2018, staff would identify the c stomers who shou • • . -_ - billed ERU rates, send them a letter explaining that the • • -` ext had made.f- in their classification, . d r-clas ify them to ERU rates. &xee•9tiff-0314-feoontl)nee ., �S effect. -; -•• • - the i ag •I •e.•f ''W not 1 own til the new rate increase took C, '" cil =' . 11.0 is `�_ : jt-., . s me pr ously-(ems charged ref+> ok metered rates, was billed in February, at the LGS rate which, as stated above, was between 64% iDA and 115% higher, until their accounts could be reclassified to ERU rates (which, for most �1 �af 0� customers,would also reflect a potentially substantial increase in rates). �N a r� � M 2o18 ORIGINAL 2018 Revised 1• 1'1` CL.`' 2016 2(017 Propose to Rescind Proposed to Replace ID 1, Small GS Metered: C.IassA,a �assA,a ��ssA,tI �_iasspeQ� L ' Tariff &Hrrl Tariff SiNed Tariff et7kd Tatiff ,^ p�J Equal to 2017 \ p l It) (d) Billed Id)•2.1% First 1+6K gallons 7.12 7.72 8.06 8.C't. .13.21 1121 ' -a $ 8.23 2.1% Next 40K gallons 6,17 6.11 ,.46 6.44 h. : 10.58 64% 5 6.58 2.1% Next SOK gallons 5.12 5,12 5.35 135 8.81 ., 65% $ 5.46 2.1% Next 100K gallons 4.62 4.62 4.82 4,82 7 9 7.36 65% $ 4.92 2.196 Next 500K gallons 2.28 2.29 2.38 2.38 5.13 5, 116% $ 2,4? 2.1% Next 500K gallons 2,28 2.28 2.38 2. 8 . 3 5.1 16% $ 2.43 2.1% AN additional gallons 2.28 2.28 2.38 2.3$ 5.1 5:13 1 '_ $ 2.43 2.1% The Tariff defines Stas custamets as reuuir ia.FRU rates. Mie-classifications of customers with meters into the metered-rate category waited in many SGS customers being sn der•bilfed at the metered tate versus ERU, When attempting to roared this problem in 2018 the SGS Metered Rate Class was eliminated leaving only the(correct) Class b Metered Rate Class. Thus,when 2018 Metered Rates were increased 2.1%above the Tariff-approved rote the result was a signifrcant increase above the prior(incorrect)billed rate. Solution: Recommend retaining SGS metered rate and';(reeling"reclassifications to ERU until future structural Tariff issues are add esred Proposed Solution to erroneous SGS rate: Rescind Resolution 2017-077; this • 1 not however, correct the problem with billing of higher rates related to misclassification of16 omer accounts. Staff recommends passage of Resolution 2018-020 which will indefinitely delay_implementing further corrections to the classification of certain water and sewer customer accounts(Class A, B,C), where the customer has bee I improperly billed for metered rates and which should have been billed instead, stand.. • : • - s- Staff further recommends passage of Resolution 2018-022 whiclwill restore the - ered block rate structure for customers with meters, classified as Class A, B or C. The end result will be that affected customers in this class (i.e. Residential and Small General Service customers currently with meters) will see a rate increase of onl 2.1% over the 2017 billed rates, and they will ao to be assured that they will not revert to ERU rate unless rt er Council action is taken.--F.V: ' -iatojets, l'6 `-a-n- aS (k c G sats �t5 rs c�n`�1Y1 Sin � � P J 7 ,- ted a -ea,rWaracS 4 61 C �S n ° ' f rv�, t i o�o•Q5 q,t, o- (A)MAC lass f4, 6 I WATER TARIFF ISSUE 7 IIej �01( 0 is 5se��, , The Water Tariff has always had only one metered rate schedule , . : = ° = - - . Specifically, e 20 8 ariff2tAintentierraily eliminated the words"unmetered"and"non-metered"from the Group Cwise}Classification{tis , C1astprimarily affect4non-mete d scho 1 non- R}.elered hospitals and non-metered laundromats). Restori g those words will ensur���ei%'�'hv o are metered,thatthey-will mit revert to ERU rates°�'�the verbiage changes will show that Class C rates(ERU rates)do not affect customers in Class C who are metered. This will resolve the concerns expressed by the 1 undromat rld Alaska Sealife Center, T� •afniang-crtherstnnkl•P&r i rl e-tci6S A 6 f LLA) 00,1s f707`oti e,lass C w I it o k � c( LQZu ra-Ee�s FUTURE RATE STUDYRIFF STRUCTURE CHANGES y C- r �r•, The administration recommends that Council authorize a comprehensive Water and Sewer classification and rate study which would involve holding public meetings aimed at crafting new Water and Sewer Tariffs more aligned with the economic realities of Seward's changing demographic and economic structure. An expert in water and sewer rate classifications may,for example,suggest that installing water meters for all small and large businesses, will ensure that customers are charged only for their consumption. If designed properly, this could eliminate the current inequities associated with seasonal businesses;for example,hotels,inns,and beds-and-breakfasts which,by Code,are not offered a rate break for vacancies in the off-season, or restaurants and employee lodging establishments charged ERU (flat) rates during the winter when they consume much less water. It could eliminate the current inequities associated with some SGS customers being billed metered rates, with others billed ERU rates. It might suggest the elimination altogether, of the concept of ERU rates, where staff are expected to visit each building,count the number of sinks,rooms,chairs,laundry units,etc.,and assign the number of Equivalent Residential Units for billing purposes. This review is somewhat subjective and causes confusion and billing inconsistencies when a building changes use-type or where customers may not use certain appliances or rooms which are in their building but not being used, and which affect the calculation of their billing calculation015_5 (i.e. sinks for salons,rooms for rent). _ INTENT: Aber s o o✓r'l td ��� � bills u (diner 3O-aOO , The intent o the cotYfbined nve resolu�s is to sur tat, itn the exception of Water customers P affected b the increase in base rate for 1 '''A"—2"meters, all customer classifications see a 2.1%water and sewe rate increase over the 2017 billed rates,as was originally expected by the Council,staff and the public. urther, it will impose an indefinite moratorium to ' - - • • . . • :. • rrently billed under metered rates, from being reassigned to ERU rat unless Council takes future action. • Lep 411/4-SL- CONSISTENCY CHECKLIST: Yes No N/A lain 7 1. Comprehensive Plan (document source here): 2. Strategic Plan (document source here): X 3. Other(list): Resolutions 2018-008,2017-077,2017-078 X FISCAL NOTE: The magnitude of these problems was not known when formulating the 2018/2019 Budget. Since the proposed"fix"will return all customer classes to a 2.1%rate increase above 2017 billed rates, and since that is what was anticipated by staff when developing the 2018 Tariffs and the 2018/2019 Budget, there is no anticipated impact on the budget resulting from these actions. Approved by Finance Department: ATTORNEY REVIEW: Yes No X RECOMMENDATION: Council approve rescinding the 2018 Sewer and Water Tariffs (Resolution 2017-077 and 2017-088), replacing them with tariffs that will effectively result in rate increases of 2.1%over 2017 billed rates,-a -, • .. '_ - . _ - • • • o reeze - . • . '. . .- . - - • • - • .' -. - -. .te not r• . '. '•_ •_ - • • a es • ' • . - - • - 8 Sponsored by: Hunt CITY OF SEWARD,ALASKA RESOLUTION 2018-020 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, RESCINDING RESOLUTION 2018-008, WHICH AUTHORIZED THE SEWARD PUBLIC UTILITIES TO ALLOW A DELAY OF UP TO SIX MONTHS IN THE EFFECTIVE DATE OF THE WATER AND SEWER TARIFFS TO CORRECT THE CLASSIFICATION FOR SOME CUSTOMERS INCORRECTLY BILLED METERED WATER AND SEWER RATES RATHER THAN STANDARD MONTHLY RATES, IN ORDER TO INDEFINITELY DELAY THE RECLASSIFICATION OF CUSTOMER UTILITY ACCOUNTS IMPROPERLY BILLED AT METERED RATHER THAN "ERU" RATES, PENDING FURTHER DIRECTION BY THE SEWARD CITY COUNCIL WHEREAS,the Seward City Council passed Resolution 2018-008 on January 22, 2018, authorizing Seward Public Utilities to allow a delay of up to six months in the effective date of the water and sewer tariffs to correct the classification for some customers incorrectly billed metered water and sewer rates rather than standard monthly Equivalent Residential Unit C'ERU")rates and WHEREAS,the billing department has determined that a number of customers classified as zy I ' 51 oCL Residential and/or Small General Service(which are classes not subject to metered water and sewer y5 ages per the Water and" )were incorrectl billed under the metered rate structure rather than based on ERU; and Dt10_-e v3-e_ 46_ ic&+0414. WHEREAS,the Seward City Council intends to hold future work sessions to evaluate the Water Tariff and Sewer Tariff and address the use of metered rates versus Equivalent Residential Unit rates,and until such time as a determination is made with respect to the appropriate handling of Residential and Small General Service classifications, the billing department will not further re- classify customers previously assigned metered rates which should have been billed ERU rates. NOW,THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1.Resolution 2018-008 approved on January 22,2018 is hereby rescinded effective immediately. �S Sectio . Seward Public tilities is hereby authorized to indefinitely delay implementing further • to the classification of certain water and sewer customer accounts, where the customer has been'improperly-billed for metered water and/or sewer rates,and whos13oniti-instend-QUe_ hm►c-beerrcharged standard ERU rates under the Residential (Class A), Small General Service (Class B), or Large General Service(Class C)classifications. 9 CITY OF SEWARD,ALASKA RESOLUTION 2018-020 Section 3. This resolution does not preclude Seward Public Utilities from making any other appropriate changes and/or corrections to customer accounts unrelated to the billing of metered rather than ERU rates. Section 4. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska. this 20`1' day of March, 2018. THE CITY OF SEWARD,ALASKA David Squires, Mayor AYES: NOES: ABSENT: ABSTAIN: ATTEST: Brenda Ballou,MMC City Clerk (City Seal) 10 Sponsored by: Hunt Casagranda/Towsley CITY OF SEWARD,ALASKA RESOLUTION 2018- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,AMENDING THE WATER TARIFF TO PROVIDE FOR A 2.1% RATE INCREASE - • , - „ _ _ ,._ ! -- ! • . 1 N1. 1 • . . 11 • _1. • X11. • ' - • d. 11. 1. WHEREAS,the rate and fee schedule will reflect the automatic annual adjustment of the previous five years' annual rates in the Consumer Price Index (CPI) so the fund is able to achieve sustainability in covering annual operating and capital costs; 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) for operations and maintenance, overhead, system expansion and charges for the use of capital facilities; and WHEREAS,in 2013,the City began repayment of the Third Avenue Water Line Debt at a rate of$156,844 per year; and WHEREAS,the Water Fund is not in a position to contribute to the Major Maintenance& Replacement Fund(MMRF); and WHEREAS,the 2018 Budget anticipated a deficit,leaving no funds available to contribute to the Major Repair and Replacement Fund,to cover depreciation costs or to make contributions to the Motor Pool. NOW,THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1. The Water Tariff for 2018 is hereby amended as presented at this meeting as "Water Rates and Charges 2018", and is effective January 1, 2018.June 1, 2018. Section 2. This resolution shall take effect ten days following approval. PASSED AND APPROVED by the City Council of the City of Seward,Alaska,this XXth day of XXXXXX 2018. 0. @ City of Seward,Alaska 2017 2018 Utilities Tariff ..\ Water Rates & Charges • efuN aq City of Seward,Alaska 2017 2018 Utilities Tariff y., WATER RATES& CHARGES RATES FOR WATER BY CLASS OF SERVICE ANNUAL RATE ADJUSTMENT: The rates and fees herein provided are adjusted 2,4 2.1%beginning the first billing cycle of the 2018 calendar year. The rates thereafter will be adjusted annually beginning the first billing of each calendar year to reflect an 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, 2017 rates reflected an increase based on the average CPI for 2010-2014.) GROUP A—RESIDENTIAL Group A includes all residential customers living in single family or multiple family living units.Multiple family units include multi-plexes, apartments and townhouses, but exclude hotels, motels and similar transient accommodations.The accounts may be paid by individual occupants or owners of multiple units. When the entire water service to a multiplex or apartment building is billed to one account, the charge will be based on total number of living units in the building whether or not occupied. Living units are considered to be complete with kitchens,baths and plumbing for laundry units.No adjustment is made for the size of the unit,numbers of amenities or the size of the family occupying the unit.A 25%reduction is permitted for units that are not plumbed for laundry units provided a common laundry unit is not available in the building or apartment complex for apartment occupants. There will be no reduction if a common laundry facility is available. BASIS FOR MONTHLY FEE Category/Description of Unit Charge Living unit with plumbing for laundry,or common laundry facility available on premises 1 ERU Living unit without plumbing for laundry and no common laundry available for use by the 0.75 occupant ERU Rental apartment unit not occupied by owner when billed as a multiple unit of 3 or more 0.75 apartments served from a single water service.(No credit will be given for unoccupied ERU units.) Duplex in one building treated as two residences served from a single water service 2 ERU ERU=Equivalent Residential Unit Chapter 3,Water Rates&Charges Page 59 e City of Seward,Alaska 2017 2018 Utilities Tariff 40;4 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. Where a building,mall or group of facilities is served from a single service,the bill will be based on the total number of facilities to be served,and no credit will be given for vacant facilities. BASIS FOR MONTHLY FEE Category/Description of Unit Charge Hotels and motels not including bars and restaurants: Basic charge per building 1.0 ERU PLUS each guest room 0.3 ERU PLUS each pair of public restrooms in excess of one pair 0.3 ERU Office Building/Mall with offices and retail stores and businesses not including restaurants,bars,food markets: Basic charge per building 1.0 ERU PLUS each office/activity 0.3 ERU PLUS each pair of public restrooms in excess of one pair 0.3 ERU Single Office/retail shop/professional activity not in office building,per each office or activity 1.0 ERU Barber,beauty,animal grooming shop: Basic charge 1.0 ERU PLUS charge per chair/tub 0.75 ERU Libraries,public offices,professional offices,and similar activities: Basic charge per building 1.0 ERU PLUS each office/activity 0.3 ERU PLUS each pair of public restrooms in excess of one pair 0.3 ERU Doctors'offices,including medical clinics,emergency first aid station,dentists' offices and similar activities: Basic charge per facility 1.0 ERU PLUS per each examination room,dental chair or similar unit 0.5 ERU PLUS per each office 0.3 ERU Warehouses: Basic charge per building 1.0 ERU PLUS each pair of restrooms or showers exceeding one pair 0.3 ERU Churches,theaters,assembly halls,clubs,fraternal clubs: Basic charge per building 1.0 ERU PLUS each pair of restrooms exceeding one pair 0.3 ERU PLUS,for food/bar service,add charge for restaurant or bar See Group C Public restrooms in parks and similar activities,per each pair of restrooms 1.0 ERU Boardwalk shops with sewage,per shop 0.5 ERU Camping&RV Parks: Per spigot 0.5 ERU Per camper/motorhome hookup 0.2 ERU Private schools,day care centers Basic charge 2.0 ERU PLUS per each 15 students or for children in excess of 25 0.5 ERU Chapter 3,Water Rates&Charges Page 60 li a� a City of Seward,Alaska 2017 2018 Utilities Tariff ;' Category/Description of Unit Charge Public baths and showers: Basic charge 2.0 ERU PLUS per each bath or shower in excess of two 0.5 ERU ERU=Equivalent Residential Unit NOTE: Only one basic charge will be assessed per building where different activities occupy the same building.This does not exclude residential charges for living units within the same building. Chapter 3,Water Rates&Charges Page 61 (2. City of Seward,Alaska 2017 2018 Utilities Tariff •' 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. These activities will be metered when newly constructed or when remodeling and/or repairs makes installation of meters feasible.When a building,mall or group of facilities is served from a single service,the bill will be based on the total number of facilities served,and no credit will be given for vacant facilities. BASIS FOR MONTHLY FEE Category/Description of Unit Charge Food/grocery markets: Basic charge 3.0 ERU PLUS per water-cooled refrigeration unit 3.0 ERU PLUS per butcher/meat packing unit 1.0 ERU PLUS per bakery 1.0 ERU PLUS per snack bar/Deli .5 ERU Restaurants and/or bars(A unit may be defined as a combination restaurant/bar if operated together or separate units if restaurant and bar are operated separately.) This category includes all drink and food service activities,including full service restaurants,hospital kitchens,dormitories,dining halls,school cafeterias,etc.: Basic charge per unit 2.0 ERU PLUS per every 8 seats in excess of 8 seats 0.5 ERU Snack Bar-no seating 0.5 ERU Garage/gas stations and retail,manufacturing and repair shops not using water for processing: Basic charge 2.0 ERU PLUS per pair of restrooms exceeding one pair 0.3 ERU PLUS per each shower 0.3 ERU PLUS per each wash bay 1.0 ERU Public schools,if non-metered,excluding swimming pools or food service: Basic charge Elementary School 7.0 ERU Jr.High School 7.0 ERU High School 8.0 ERU PLUS swimming pool 15.0 ERU PLUS charge for food service based on rate for restaurants See Above Hospital&Nursing Homes,if un-metered,excluding food service: Basic charge 6.0 ERU PLUS charge for food service based on rate for restaurants See Above Laundry(self-service or commercial units),un-metered[new laundries will be metered]: Basic charge 2.0 ERU PLUS per each laundry unit of 12 pounds or less capacity 1.0 ERU PLUS per each laundry unit larger than 12 pounds capacity 2.0 ERU ERU=Equivalent Residential Unit Chapter 3,Water Rates&Charges Page 62 Lici City of Seward,Alaska ' „2018 Utilities Tariff y 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. All new activities shall be metered, and existing facilities will be converted to meters when remodeling and repairs make installation of a meter feasible. Meters must include readouts at a location acceptable to the City,to allow for accurate meter readings. The cost of initial installation of a meter in a new facility will be paid by the customer. The cost of maintenance,repair and replacement of the meter will be at customer expense.The customer will provide a meter,and the user will pay the cost of installation,where an existing service is converted to meter and the commercial use/activities of the user have not changed. If the meter is required due to changed usage, the customer will pay all costs, including the cost of the meter. In all cases, the City will specify and/or approve the type of meter and its installation. A customer may request to be converted to meter rates. If a customer request is approved to convert to meter rates, the customer will install a meter at the customer's expense, and thereafter charges will be based on metered usage.A customer cannot convert from metered to fixed rate billing. BASIS FOR MONTHLY GROUP D FEE MINIMUM CHARGE FOR EACH METERED SERVICE Service Size Minimum Monthly Charge 3/4"- 1" Service $23.21 $47.64 1-1/2"-2" Service $16.11 $95.73- 2-1/4"-4" Service $231.18 $239.10 Over 4" Service $1,170.73$1,195.32 Note: The minimum charge per metered service does not include fire sprinkler service CHARGE FOR CONSUMPTION Consumption per Month per Meter Charge per 1,000 Gallons First 50,000 Gallons $5788-$6.00 Next 500,000 Gallons $4-68—$4.78 Next 1,000,000 Gallons $334-$3.66 Next 2,000,000 Gallons ;$2.93-$2.99 All Additional Gallons $1.50$1.53 The consumption metered on several metered services serving the same owner will not be combined to calculate the monthly bill.Each will be computed as a separate bill.The City may negotiate or renegotiate special contracts with a user that consumes in excess of 20 million gallons of water per calendar year. Such contracts will set or amend a rate which will assure that the user pays its full share of the utility's fixed and variable operating and maintenance costs. All special contracts and renegotiations of existing special contracts shall be approved by resolution of the City Council. Chapter 3,Water Rates&Charges Page 63 City of Seward,Alaska 2017 2018 Utilities Tariff �•y GROUP E-SPECIAL RATES AND FEES Group E includes charges for other categories of service not included in Groups A through D. Equivalent Residential Unit(ERU) $46 ;47.64 Fire Hydrant Use Permit From May 1 to August 31 a Fire Hydrant Permit may be issued. Fire Hydrants will be turned on and off by Water or Fire Department Personnel. If the City determines that a meter and a backflow preventer are required these will also be installed by Water Department personnel. This rate is set for contractors or other temporary water users, but not for bulk water service to ships or tanker trucks serving ships or industries. Tapping Fee $96.77 PLUS Daily Fee $48.38 PLUS Weekly Fee $290.27 Water Service Connection Fee Done by city: Up to 1"service not longer than 60 feet(one time charge) $2,709.16 In excess of 60 feet-actual cost,but not less than $2,709.16 PLUS cost of paving and curb replacement Done by contractor: Connection Fee $162.85 PLUS cost of paving and curb replacement Water Service Inspection Fee For service installed by others $96.77 Water Turn-On or Turn-Off(per visit,excluding new service and new account name) First turn-on and/or turn-off for new service or new account No Charge All other turn-ons or turn-offs: During business hours $48.38 During non-business hours $145.12 Seasonal turn-ons and turn-offs $162.85 Seasonal turn-on/turn-off is not classified as a new account and will be charged as "Seasonal Turn-Ons and Turn-Offs". Unauthorized Use of City Equipment, including fire hydrants, key boxes,turn-on and/or turn-off $967.58 Restoration of Water Service, including repair of damage by owner or Actual cost,including city contractor to city facilities overhead,labor,materials and equipment. Locate Service Large projects requiring several locates will be under a special agreement with the water utility and may include an additional fee. May 1 -October 31 No Charge November 1 -April 30 $145.12 Thaw Wire Locate May 1 -October 31 No Charge November 1 -April 30 $145.12 Security Deposit Domestic(Single Family&Duplex) $48.38 Chapter 3,Water Rates&Charges Page 64 difti.,0 City of Seward,Alaska 2017 2018 Utilities Tariff r�„y Commercial&Multiple Dwellings $145.12 Fire Hydrant Usage $290.27 Category/Description of Unit Charge Contractor Work Any contractor tapping into a city main, or otherwise working on a city water line, must be properly licensed to perform the work and must also provide a$5,000.00 bond or equivalent cash guarantee payable to the city. Ship Water(Water furnished to temporarily moored vessels) Customer will be responsible for actual charges related to all work and materials required to provide water to vessel. The point of delivery for potable water supplied by the City shall be at the customer side of the meter/backflow preventer, and the customer is responsible for water quality from the delivery point to the vessel. Less than 1,000 gallons from Seward Small Boat Harbor facilities not No requiring city assistance or the use of fire hydrants Charge All service not included above: Basic Charge(during regular business hours) $96.77 Basic Charge(outside regular business hours) $193.52 PLUS $9.00 per 1,000 gallons for all water used Chapter 3,Water Rates&Charges Page 65 Sponsored by: lCasagranda/Towsley CITY OF SEWARD,ALASKA RESOLUTION 2018-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AMENDING THE SEWER TARIFF TO PROVIDE FOR A 2.1%RATE ADJUSTMENT BEGINNING THE FIRST BILLING CYCLE OF THE 2018 CALENDAR YEAR • . • • I • , , ' . . 1 • _ • , . • • 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)for operations and maintenance,overhead,system expansion and charges for the use of capital facilities;and WHEREAS,in 20 1 5,the City executed loans inthe amount ofnearly$1.7 Millionto pay for the sludge removal and maintenance of the Lowell Point and Spring Creek wastewater treatment facilities; and WHEREAS,experience has demonstrated the importance ofsettingaside funds annuallyto dredge and maintain wastewater treatment facilities and lagoons in accordance with routine schedules; and WHEREAS, failing to adopt incremental rate changes can lead to rate-shock associated with infrequent large rate changes,and can lead to the utility being unable to adequately cover the cost ofoperations,critical capital infrastructure repairs and replacement or demonstrate adequate financial health to qualify for low interest loans. —and NOW,THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA,that: CITY OF SEWARD,ALASKA RESOLUTION 2018-XXX Section 1. The Sewer Tariff for 2018 is hereby amended in the form presented at this meeting as "Sewer Rates and Charges—2018". Section 2. All previous Resolutions in conflict herewith are hereby repealed effective December 31, 2017.May 31, 2018. Section 3. This resolution shall be effective January 1, 2018. June 1,2018. PASSED AND APPROVED by the City Council of the City of Seward,Alaska,this XXth day of XXXX,2018. THE CITY OF SEWARD, ALASKA David Squires,Mayor AYES: NOES: ABSENT: ABSTAIN: ATTEST: Brenda J. Ballou,MMC City Clerk (City Seal) l'' ''''' g City of Seward,Alaska 2017 2018 Utilities Tariff 40am1:1 Sewer Rates & Charge City of Seward,Alaska 2017 2018 Utilities Tariff j SEWER RATES& CHARGES RATES FOR SEWER BY CLASS OF SERVICE ANNUAL RATE ADJUSTMENT: The rates and fees herein provided are adjusted 4.4%2.1%beginning the first billing cycle of the 2017 2018 calendar year. The rates thereafter will be adjusted annually beginning the first billing of each calendar year to reflect an average of the five previous published years' annual increase 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, 2017 rates reflected an increase based on the average CPIfor 2010-2014.) GROUP A—RESIDENTIAL Group A includes all residential customers living in single family or multiple family living units.Multiple family units include multiplexes, apartments and townhouses, but exclude 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$64729 $65.64 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 the water service,a water charge shall be computed based on the activities served by the sewer.The sewer rate shall then be computed at 1.2 times the established water charge. METERED SERVICES: 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 wastewater is not discharged into the city sewer system. Chapter 4,Sewer Rates&Charges Page 67 •.06�%. City of Seward,Alaska 2017 2018 Utilities Tariff y„d MINIMUM CHARGE FOR EACH METERED SERVICE Service Size Minimum Monthly Charge 3/4"- 1"water service $34-8-5-$56.00 1-1/2"-2"water service $90.75-$92.66 2-1/4"-4"water service $228.8 -$233.62 Over 4"water service $1,113.99$1168.01 CHARGE FOR CONSUMPTION Gallons of Sewage Discharged per Month Charge per 1,000 Gallons Groups A,B&C Group D First 10,000 Gallons $8.06 $44:44-$13.21 Next 40,000 Gallons $6.44 $10436-$10.58 Next 50,000 Gallons $5.35 $8.63-$8.81 Next 100,000 Gallons $4.82 $;780-$7.96 All Additional Gallons $2.38 6-5702-$5.13 GROUP E-SPECIAL RATES AND FEES: Group E includes charges for other categories of service not included in Groups A through D. Users generating sewage with a BOD and SS loading in excess Specified rate in rate tables times a factor of mg/1 (upon a determination by the Utility Manager that the of the actual BOD and SS loading divided concentration and characteristics of the sewage will not cause a by 250,plus the cost of testing. detrimental effect upon the sewer system and/or treatment Rate x BOD Factor+SS Loading+Test Cost plant). 250 BOD=Biological Oxygen Demand SS=Suspended Solids Chapter 4,Sewer Rates&Charges Page 68 • dMt �. City of Seward,Alaska 244-7 2018 Utilities Tariff IraW Tank Truck Operators: Fresh sewage, or 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. $62.40 per thousand It is prohibited to discharge into the city's sewer system,septic tank waste or any waste gallons containing toxic or other materials that could cause the city's discharge to violate the EPA or DEC discharge permit. Recreational Vehicles Individual RV owners utilizing city-owned or approved dump sites No fee Public and private campground operators (Operators must maintain $1.06/day per RV,camper sufficient records to compute a monthly payment, and such records or trailer permit,not shall be made available to the city upon request) including tent campers. Ship's Sewage Not accepted 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, administration, materials and equipment PLUS a$150.64 connection fee. Sewer Service Inspection Fee $120.51 This fee shall be charged for services installed by anyone other than the city. Unauthorized Connection or Discharge into the City Sewer System Per Occurrence $945.46 PLUS cost of repair,restoration or cleanup by city PLUS State and/or Federal penalties&charges levied against the city or individual Restoration of Sewer Service and Repair of Damage by Owner or Contractor Actual cost,including city to City Facilities overhead,administration, labor,materials and equipment. Locate Sewer Main Large projects requiring several locates will be under a special contract and may require a fee. First Locate No Charge Each Additional Locate $94.53 Security Deposit If a water security deposit was paid no additional deposit will be required. If no water deposit was paid the following deposits will be charged. Domestic(Single Family&Duplex) $47.27 Commercial $141.81 Multi-Family $141.81 Contractor Work Any contractor tapping into a city sewer main, or otherwise working on a city sewer main,must be properly licensed to perform the work and must provide$5,000 Bond or equivalent cash guarantee payable to the city. Chapter 4,Sewer Rates&Charges Page 69 C 4 V • City of Seward,Alaska 2017 2018 Utilities Tariff ,,�' Sewage Meter Computed from the quantity of metered water delivered to the same activity unless a sewage meter has been installed.Sewage meters approved by the city may be installed at the user's expense. Delinquent Account Charges Interest rate 10.5%per annum Monthly late fee $5.75 Chapter 4,Sewer Rates&Charges Page 70 �.3 Proposed Changes to the Tariff Casagranda/Towsley • Index of changes o All headings- all pages o Chapter 3, Water Rates and Charges • Pages 1, 5, and 6 Ce3-4— Gq o Chapter 4, Sewer Rates and Charges • Pages 1 &2 SThAomnf 1-c)1-" Dadis JOJ „fr ,..11143 cCIR r \41r1: ' a irLcr -*71-11-0 aNck - 0± :107-r-prod TTS 7'c' (-to IA a7r190 1'4 te t-64-1-5--g— .7vr, 4pf 44d.1-1t4r 90 (+11 ' >P90"? cs- rfrc- s- 3:127-i-rt_amA g--cIT-rio \I/Ty ) Q tt4t 7r j N-dra-XJ .Thrt-0) 2-14[9-2, d _A--aracji r eenii twvomA rr-c2f p104)5 cirriY1 S 314z1 ra-o-o-1 pir-‘0 - cc r- se-v rtF - .14-wAA, jaa 714 Qc2i- 70- -1-7" 3NA-15") 01-7 -(Z) (90-- ci tTd 9NTh1 NO 1 r-vt -rptcrl 4 w--1 ry--ned \- k0 J --YVO 's lit ryl of sr • or---557,-Al 5'11 ok -Rp-4712,pn _y, 4,1 1e-0J-a S=i7L--6 0-0 J'XIA)A41-11-- -wv11) -it(1 71ALC° Q+ a" 40,1,-1\ 3-)140/1- A;:er r yra )101 0\ .1Y?9(19-Zr'rt\ - ry+ o -a- 0-0cyl • RI croi.), caj-v- 9-, 01.41r ( 51 9%; tr-0-301-NdT;V jp ----ecfritoW337' 1, S,y_j T_A-v2f_ _F—Ft9w-v-J--a7Nrcr) - TC -g--3-0 - /Oz-h r.r12010-3:3- j 9 -4+:1 --rvichQ1 (1,0`.q;130 (WO 1,Y-V7 9 :1127 ggo,p ,ds 411-.1v — — - ----- -f t rc k )L( 4-1.4►7 _-- Coqc owak a n. 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I.: ... ' , �.. - � %per lit f-eal „<#. -6.661 ----"aerr,- - Z_._.- :t-- - - '- .-a - 4t-- ��d';''/. -_._ . , -- --- v4. . • otorjtjujeT A..---._._,g___ __ — X10)s DJ 0-7 r 5 Sc LASSl1 — )..Acs ),--y-r-tw---1-r--To LA ro-lo0 c-TH,+ ut20 usra-d-rpr- SSSS YTT(1. ( Frua UrrIc)p • -• •xit_r_s3 Ce) UISnCrro CAA O sl - -r0v-N4Y uirt- Vrat-cl-t- 4 I I i • ,43 1 5 157) 4 -431 L4- Q 71 ,1 5( 3 111 SI 1-7C5 'p March 18, 2018 Dear Mayor Squires and Members of the Council, We are long time Seward residents who have witnessed many chapters of the on-going Seward Utility Rate confusion. Water usage increases at Suds n'Swirl prompted us to write and we want to urge Administration and Council to carefully review the consequences of the proposed Water Utility rates to this specific small business. Seward needs a place where people can wash their clothes. As we understand it , the proposed changes would put them (or any laundry operator of their scale,) out of business. We understand that "mistakes were made" and we need to "turn the page" so we can all move forward but clearly not at the expense of closing businesses built on reasonable business plans that were based on reasonable rate increases. Some of the numbers we have seen do not appear reasonable to us. When reviewing several Customer's Account information statements, it appears to us, all are a rat's nest of confusing line items and many appear on surface to be grossly unfair if not unreasonable. We appreciate that everyone is working very hard on this. Thank you, L.ANi1/4.5L. Ron New ome & Connie Alsup LOST LAKE GUEST HOUSE LLC. City of Seward March 14, 2018 Dear City of Seward and the City Council of Seward, This letter is regarding the small business Suds N' Swirl and the tariffs the city is placing on the said business. This is outrageous! I run a small business and use the services of Suds N Swirl, but will NOT be able to AFFORD to use their services if you add on this tariff. This will have a trickling effect on every business in Seward and not a good trickle... Please rethink what you are doing when you implement these charges on city business owners. Do you want to live in the dark? Because that is what you will see if you implement these charges. You will be pushing out of town all the business and the people that run these businesses in our small little waterfront town of Seward. Sincerely, Shirley Campbell . ,.- 13150 Samantha Dr 111 Seward,AK 99664 a—fay„,,,t /7- fir_. .-._-_. 41/14,4".a _.Z�'" —,GAO—� �•_ts I _ �,. ��,v�c.mh(/ _ .44,7 178 - 4111 ace ‘.....,-.&41201[24.--......, _ _ -._,C12°M 9 AIL • , lib._._A.:D_±_ '12 _ ids � —__ b_� — - � _r - —_I V _ auk__ \o 8,(s 1 - ------171 eas_f__Ccy\-- 5 - Ii.$ E - ae --- _ --- __ i_ __ ___ - __-i. ;:, _ _ CiDin--- thclibt-L--; v„k,i__ __ . -_----lel—f,_____ 104-41-- ta-----cir-c --- -±"ci -F-' _L__ _ _._,%4:14_b_t,.._ up-e__ ‘'. \A be_ , ,c,'„,c-c,c__.c. _An __v./La_ v.),_,,,_, ____ ..,-- 5A.1.80 ____"n' a),)\c , W — II4L 1111 tstiliPAy4 ja iiIjr 020yr idA- Va City of Seward March 20,2018 PO Box 167 410 Adams Street City Hall Building Seward,AK 99664 Dear City of Seward, It has come to my attention that the City of Seward is proposing water and sewer tariffs that will significantly impact the costs of small business owners in the City Seward. For example, businesses like Suds and Swirl Facility relies on high water and sewer usage for laundering.As a small business owner for nightly rentals during a very short season, I understand the costs and risk that go into running your own business in our small town. Suds and Swirl provides a unique service that is important for guests visiting our town as well as people that live here that may not have laundering available to them or require it for bulk items. Suds and Swirl is projecting a 33%increase in bills which will cause them to go out of business. We do not have another option for laundering in Seward so this suggested tariff would be detrimental to our community. Please reconsider this proposed tax and other options for meeting budget constraints. Respectfully, r , / / - i/ / Rebekka Federer, Business Owner Alaska Alpine Meadow Retreat PO Box 475 Seward,AK 99664 March 20, 2018 To Seward City Council, I am writing this letter to ask you to please reconsider the tariff increases effecting Suds n'Swirl Laundromat. Desiree's business provides a much-needed service for our community; especially considering the high influx of visitors we have each summer. From campers on the beachfront to guests at many local bed and breakfasts,there are many people who need the laundry services Suds n'Swirl provides. Locals,too, benefit from having a laundromat in town. Many residents do not otherwise have access to a washer and dryer;from renters to homeowners. It is my understanding that the new increases would raise Suds n' Swirls costs so dramatically that Desiree would be forced out of business.While I understand the need for the City of Seward to consider increases in income to remain economically sustainable, please consider rewording the language of what qualifies the tariff increases in order for a local business and service to remain economically sustainable as well. Thank you, Jen Ransom P.O. Box 3236 Seward,AK 99664 March 17, 2018 To Seward City Council, While visiting my daughter in Seward this past week I heard about the plight of Suds n'Swirl Laundromat in regard to the proposed water tariff hikes. It is my understanding that tariffs would raise the cost of doing business so high that the owner would be forced to shut down. If this were to happen, Seward would lose a vital service. While living in Seward for 30 years, I found myself using local laundromats here and there:When the washer broke down, when work responsibilities mounted the laundry pile so high that a quick Saturday washing of all the loads at once was well worth the cost of utilizing a laundromat. Now that my husband and I summer in Seward, I find Suds n'Swirl to be not just a luxury, but a necessity while camping in the wonderful waterfront campgrounds Seward has to offer.Once a week I spend a wonderful morning catching up with Desiree'and cleaning our clothing and bedding so that we can spend another week in this amazing town. I regularly run into other long-term campers there as well: Many of us use this service to stay in Seward for as long as the snow stays away. Please reconsider how the new tariff increases would affect Suds n'Swirl bottom line.Should the operating costs rise so dramatically that it forces the closing of a local business,there are many locals and visitors that would be adversely affected. Thank you for your time, ff 10,, 41 1 ,043 B.J.and John Blackwell P.O. Box 1063 Winchester Bay, OR 97467 C1:91,77 -FpAPPerVr>t15179- 1//- 419-AS af . -3a /s&e-deli(o p-i-vP peen./ F gt? 1W / LP?do s-we-/t9 b77orp or-t /77-7-ut-- ----e riviv 7a cy &le() ruf/K79Y FIY-71) 1V7717 F7p -72v A/ 0--/- Fripira7 Iwo? aim Sc6.1›.7/74,r --->37(70—pt -V---- -Y-2Q15s-a--"d2Lnez-77,74---vere- ff.4-17-07---7rn it.2 •96335W/7577r ilvt-tig'-7,71-P—i4 0-60,7-tisvci r7vs iT 4-11i W77- ?v-p' tr-ceri 17 ' 77 - r77 (JP isc41 -?,../Qvgrocr v pie7-007 Psrii>/ prr -7-1-12_ ; 9-7c-1/2ra ta 9.f s-a7-7-kolorjotAw 5-7.77q9eryt-picir pru Ayemen- SD / *W7 ?? Sciatig • 5OrP,if)Ynf rn-Ipuexaar wwh- cli-str--;n7 iew-pici-s Ow. 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