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HomeMy WebLinkAbout03202018 City Council Laydown - Rescind and Replace Water and Sewer Tariff Agenda Statement180320 �00tk) Agenda Statement Meeting Date: March 20, 2018 To: City Council Through: Jim Hunt, City Manager From: Kristin Erchinger, Finance Director '1 0 �l ((At4f1�d4) 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 Ratesa�, 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%. 20180RIGINAL 2018 Revised 2016 2017 Propose to Rescind Large GS Metered: CUSS Class Tariff Billed Tariff Billed (a) (h) FirstloKgallons 12.3 772 12.94 $ v6 Next401(gallons S,2 "17 A.36 c,44 Next 5uKgallons 8.27 542-So 5.35 NextlGGKgallons 7,47 4,62 17.80 4.82 Next 500K gallons 4,81 2,28 I" 5.02 2.38 Next 500K gallons 4.81 2.28 5,02 2.28 All additional gallons 4.81 2.28 t 5,02 2.38 Proposed to Replace Class b Class b Tariff Billed So Change Tariff 96 Change 2.1%increase Equal to 2017 above (a) Btued (b) t 2.196E 123.21 a $ $.23 2 190 10. 1038 649'0 5 6.58 2 190 _. 8.81 ^' _. 65% $ 5.40 2,190' 65% ; $ 4,92 2.1%; 5.13 5. Ilv'Y S 2 43 2.190 5.1? 16% . ., 2,49 2.19 5.1? 5.13 1 Note that the 2017 "Toriff shows a much higher rate for Class 0 than customers were being ' Blued ". Thus. when 2018 rates were increased 2.1 a above the Tariff -approved rate. the result was a s;gnificant increase above the prior (incorrert) billed rate. Proposed Solution: Reduce LG_S sewer tariff rates to nurror 5G5 sewer tariff rates, to be consistent with post /erroneous? billing practices until such time as future structural Tariff issues are addressed. 2) 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, $12.94 for the first 1 OK gallons — would result in an increase in LGS metered sewer rates of between 64% and 115%. Therefore, staff recommends rescinding and replacing with a Sewer Tariff that will make the LGS Sewer metered rates equivalent to the SGS Sewer metered rates, which is consistent with past (erroneous) billing practices. This will ensure that LGS customers' rates increase only 2.1 % over the 2017 billed rates. Problem #2: In the process of preparing for the rate change, staff identified a number of customers previously charged for metered water and sewer charges,$���� SGS customers let l; by definition,-� � billed metered rates; -lot - ;,according to the tariff definitions. The 2018 original Tariff attempte�to��'�- 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 eey he time of the rate change and July 1, 2018, staff would identify the c st I ers who shou billed ERU rates, send them a letter explaining that the 'c� �t •13atd made in their classification, nd r clasfy them to ERU rates. ' girl S id f sh;�a 'tucbe. f a o own til the new rate increase took effect. , a s me prevlously-{erfiyj charged metered rates, was billed in February, at the LGS rate which, as stated above, was between 64% and 115% higher, until their accounts could be reclassified to ERU rates (which, for most customers, would also reflect a potentially substantial increase in rates). 2Ui8 O KANAt 2316 2C17 Propose to Rescind Small GS Metered: zAassa, a Class A, a :" A, t Tariff P4'11e1 T*W EiNed Uiff P41a4 bF"nsr 3��k Sallatts Wext 44K �+�arss Next SOX gallons Next 10.0k vatUtNiS Next 5X* galiam Next SFJct{ galr,sss All a"Ootsal gAlotrs j;> ld9 77.1 7 72 it iir i�4 6-17 LAI iA6 6A4 5.1i !,It S.S3 5.3S 4,61 4.62 4.82 4,92 2.28 2,20 2.38 L?ft 2,a6 1.2!t 2.38 2.�g' 3128 2.28 F.3R 3 <A 1981 7 V%t8 2018 Revised Proposed to Replace ;:lass A, E T.uiff Equal to 200 60d id, +2.1% $ 8,23 2.1% 4% $ 6$a 2.1% 49, 5.4+ 21% 4192 2.4. 23% the TOO# defines S&S custamets as reaubim) EiRU tares, of castonbers with meters help the n tered rate catr+ aty rt rrherl in many SGS custOnrrrs bf109 under•tnNed of the metered rate versus FRO, Iris atte msfinq to rower this rwoidein in 1378 the WSMettred hate O trs `pus eliminated leaving o!dy the lwatrectt Class D Metered Rare Class, thus; when :'U28 Ortered Rates were increased 1,14� above the rarefy -approved rate the resuit was a sigrtifaunrincrease ctwve the prior iinrurrery biYed rote, solution. Rerc+narnuuf retaia?ttg SUS metered rate and free:inq= reclas1#5cationx to ERV antij tuture struerurnt Tariff icy K — .,ter r —.a Proposed Solution to erroneous SGS rate: Rescind Resolution 2017-077; this fall not however, correct the problem with billing of higher rates related to misclassification ofl6d omer accounts. Staff recommends passage of Resolution 2018-620 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 be improperly billed for metered rates and which should have been billed instead, stanAn • Staff further recommends passage of Resolution 2018-022 whic will restore the e 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 only 2.1a/o over the 2017 billed rates, and they will be assured that they will not revert to ERU rate unless rt er Council action is taken. i0, aei� r 5 t n--u�5 in gin C•e j2- � l %-}0,rti-� as 01w d 0-,, usgrs o-a n o q J.P , n d 1(— i . . A(% L �,, (. M1 . y-Ai� n I /r iCL t%G 4 (t I WATER TARIFF ISSUE The Water Tariff has always had only one metered rate schedulerscheduleC +v4q . Specifically, the 20. 8 ariff"WOH6 y eliminated the words °`unmeterdd" and "non -metered" from the Group CiClassification {phis Classdprimarily affect non -mete d scho 1 non- a ered hospitals and non -metered Laundromats). Restori g those words will ensursw e�o are metered, that tit will yet revertto ERU ratesV,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 d Alaska Sealife Center, / 4M .0th rs©Yl��. k 0 If) class � TO (,IaSs C t� , l I D N L u� ec( 2U1 I�0. 5 f1f,� Cl s ic/l FUTURE RATE STUDY TARIFF STRUCTURE CHANGES ����b�-' �a (�" The administration recommends that Council authorize a comprehensive Water annd ewer cl (Nicationt r" 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 calculation (i.e. sinks for salons, rooms for reLati,�flA INTENT: U 5S A 18� �- s y o The intent the cozYib�'ne ve �eso1AM s is to4r the exce ti a��� p on of Water customers affected b the increase in base rate for 1 %2" — 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 t rrently billed under metered rates, from being reassigned to ERU rat unless Council takes future action. PJ1i� S" CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan (document source here): 2. Strategic Plan (document source here): X 3. Other (list): Resolutions 2018-008, 2017-0775 2017-078 Ix 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, -mod-► o freeze Me ctassifiration of to not a es t 01� 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, uthorizing 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 ("ERU") rates and WHEREAS, the billing department has determined that a number of customers classified as Residential and/or Small General Servi _which are classes not subject to metered wed sewer g rates per the Water and Sewer Tariff�—Vere incorrect) billed under the metered rate structure r than based on ERU: an� �� _Aopw 4�� 2D`%1 & „lr o 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 nblitilities is hereby authorized to indefinitely delay implementing further to the classification of certain water and sewer customer accounts, where the customer has been impreperly billed for metered water and/or sewer rates, and wh &/',e- (Jp%,4) -het,z-beert-charged standard ERU rates under the Residential (Class A), Small General Service (Class B), or Large General Service (Class C) classifications. 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 201h day of March, 2018. AYES: NOES: ABSENT: ABSTAIN: ATTEST: Brenda Ballou, MMC City Clerk (City Seal) THE CITY OF SEWARD, ALASKA David Squires, Mayor 10 Sponsored by: gtmt 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 C-LARdFYING METERED VERSUS NON METERED, CHANGING T-14E rr'ESEASONAL ��TzNITrON�AND OT-14rD rTUO 14O SKETiTNG �iSS� S 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 januafy-1, 2 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 XX'h day of XXXXXX 2018. City of Seward, Alaska 2037 2018 Utilities Tariff Water Rates & Charges City of Seward, Alaska n3;1 2018 Utilities Tariff WATER RATES & CHARGES RATES FOR WATER BY CLASS OF SERVICE ANNUAL RATE ADJUSTMENT. • The rates and fees herein provided are adjusted �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 rejlect 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 occupant 0.75 ERU Rental apartment unit not occupied by owner when billed as a multiple unit of 3 or more apartments served from a single water service. (No credit will be given for unoccupied units. 0.75 ERU 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 City of Seward, Alaska 'corn' 7 2018 Utilities Tariff 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/Mail 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 serviceadd charge for restaurant or bar see Group C Public restrooms in parks and similar activitiesper 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 cam r/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 U City of Seward, Alaska 241,7 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 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 {3 City of Seward, Alaska �817 2018 Utilities Tariff 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" - V Service --$23.2� $ 47.64 1-1/2" - 2" Service $46.4 4 $ 95.73- 2-1/4" - 4" Service 4-.-' ° $ 239.10 Over 4" Service 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 1000 Gallons First 50,000 Gallons $.4&$ 6.00 Next 500,000 Gallons $4-69—$4.78 Next 1,000,000 Gallons $3444 3.66 Next 2,000,000 Gallons $2- 3-$ 2.99 All Additional Gallons &1-.W$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 :1017 2018 Utilities Tariff 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) $46.66 $47.64 Fire Hydrant Use Permit From May I 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 baclfow 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 I " 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 e ui ment. 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 City of Seward, Alaska 2414 2018 Utilities Tariff Commercial & Multiple Dwellings Fire Hvdrant Usaee $145.12 $290.27 Category/Description of Unit I 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 deliveryfor potable water supplied by the City shall be at the customer side of the meter/backflow preventer, and the customer is responsible for water qualityfrom 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) Basic Charge (outside regular business hours) $96.77 $193.52 PLUS $9.00 per 1,000 gallons for all water used Chapter 3, Water Rates & Charges Page 65 on Sponsored by: Casa dr a/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 ADDING A SEASONALTURN- ON/TURN OFF FEE, E , C- A RJFV71� G TH ♦ T METERED T ♦ TES APPLY u t ONLY TO CLASS D CUSTOMERS, AND OTHER MINO 14OUSEKEEPING CHANGES — 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 ofproviding services (including direct and indirect costs) for operations and maintenance, overhead, system expansion and charges for the use of capital facilities; and WHEREAS, in 2015, the City executed loans in the amount ofnearly $1.7 Milliontopay for the sludge removal and maintenance of the Lowell Point and Spring Creek wastewater treatment facilities; and WHEREAS, experience has demonstrated the importance ofsettingaside fundsannuallyto 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. —ate Irw NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: CITY OF SEWARD, ALASKA 1 D1 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, -41- May 31. 2018. Section 3. This resolution shall be effective ; ��T?�-June 1, 2018. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this XX"' 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) rs City of Seward, Alaska 241-7 2018 Utilities Tariff Sewer Rates & Charge City of Seward, Alaska :201 Z 2018 Utilities Tariff SEWER RATES & CHARGES RATES FOR SEWER BY CLASS OF SERVICE ANNUAL RATE ADJUSTMENT. The rates and fees herein provided are adjusted 444 2.1 % beginning the first billing cycle of the 4OP-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, A11 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 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 $64.29 $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 City of Seward, Alaska 2017 2018 Utilities Tariff MINIMUM CHARGE FOR EACH METERED SERVICE Service Size Minimum Monthly Charge 3/4" - V water service "`�$56.00 1-1 /2" - 2" water service $90:75-$92.66 2-1/4" - 4" water service $228.81-$233.62 Over 4" water service $ 4,1 "mT$1168.01 CHARGE FOR CONSUMPTION S 77 � �<ASWP Gallons of Sewage Discharged per Month Charge per 1,000 Gallons Groups A, B & C Group D First 10,000 Gallons $8.06 Q $13.21 Next 40,000 Gallons $6.44 $10.96r$10.58 Next 50,000 Gallons $5.35 $8- X48.81 Next 100,000 Gallons $4.82 7.96 All Additional Gallons $2.38 $&02-$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 of mg/1 (upon a determination by the Utility Manager that the concentration and characteristics of the sewage will not cause a detrimental effect upon the sewer system and/or treatment plant). BOD = Biological Oxygen Demand Specified rate in rate tables times a factor of the actual BOD and SS loading divided by 250, plus the cost of testing. Rate x BOD Factor + SS Loading + Test Cost 250 Chapter 4, Sewer Rates & Charges Page 68 City of Seward, Alaska z 2018 Utilities Tariff 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 citys 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 $1.061day 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. Shi 's Sewage Not acceted 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 S945.46 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 ci Chapter 4, Sewer Rates & Charges Page 69 City of Seward, Alaska 28142018 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 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 6 125, C -3 o Chapter 4, Sewer Rates and Charges ■ Pages 1 & 2 �a5R--- (o -7, (ag What is an ERU? An ERU = Equivalent Residential Unit When designing or evaluating a water system. we compare non- residential and multi family water 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 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. Water Tariff 2017 Tariff vs. 2018 Tariff What Changed?