Agenda packet — American Canyon City Council, April 2, 2024

REGULAR CITY COUNCIL MEETING AGENDA
City Hall - Council Chambers
4381 Broadway St., Suite 201, American Canyon
April 2, 2024
6:30 PM
At this mee!ng, Vice Mayor David Oro will par!cipate via teleconference from Hilton Garden Inn Santa Barbara/Goleta Business Center at 6878 Hollister Avenue, Goleta, CA 93177.

Tonight's mee!ng is a limited public forum. American Canyon promotes respec9ul and responsible behavior among its mee!ng par!cipants, whether they are present in person or remotely. Using offensive language or remarks that promote, foster, or perpetuate discrimina!on based on race, creed, color, age, religion, gender marital status, status regarding public assistance, na!onal origin, physical or mental disability or sexual orienta!on/gender iden!fica!on, as well as any other category protected by federal, state or local laws will not be tolerated. In the case of an occurrence, the speaker will be immediately disconnected from the microphone.

PUBLIC PARTICIPATION
City Council and other public mee"ngs will be conducted in person. This mee"ng is also available via Zoom, is broadcast live to residents on Napa Valley TV, on our website and on YouTube.

Zoom Link: Click here. Webinar ID: 862 3299 1024; Passcode: 12345.Phone in to Zoom: 408-638-0968 Oral comments, during the meeting: Oral comments can be made in person during Open and Closed Session or through Zoom in Open Session only. On Zoom use the "raise your hand" tool during any public comment period.

To avoid confusion, hands raised outside of Public Comment periods will be lowered.

Wri@en comments: Submit wri4en comments by the eComments link, located on the Mee"ngs & Agendas page of our website. eComments are available to council members in real "me. To allow for Council review of comments, eComments will close at 3:00 pm on the day of the meeting.

The above iden"fied measures exceed all legal requirements for par"cipa"on in public comment, including those imposed by the Ralph M. Brown Act. For more informa"on, please call the Office of the City Clerk at (707) 647-4369 or email [email protected].

AGENDA MATERIALS: City Council agenda materials are published 72 hours prior to the mee-ng and are available to the public via the City’s website at www.cityofamericancanyon.org.

AMERICANS WITH DISABILITIES ACT: The City Council will provide materials in appropriate alterna"ve formats to comply with the Americans with Disabili"es Act. Please send a wri4en request to City Clerk at 4381 Broadway, Suite 201, American Canyon, CA 94503 or by email to [email protected]. Include your name, address, phone number and brief descrip"on of the requested materials, as well as your preferred alternative format or auxiliary aid, at least three calendar days before the meeting.

Mayor: Leon Garcia
Vice Mayor: David Oro
Councilmembers: Mariam Aboudamous, Mark Joseph, Pierre Washington CITY COUNCIL MEETING AGENDA APRIL 2, 2024
1 5:30 P.M. – CLOSED SESSION
The mayor will call the meeng to order and conduct roll call. Council will immediately convene into Closed Session aer hearing any public comment on Closed Session items. At 6:30 p.m. the Council will reconvene into Open Session and then resume Closed Session at the end of the meeting to address outstanding items, if necessary.

CALL TO ORDER - CLOSED SESSION

ROLL CALL - CLOSED SESSION

PUBLIC COMMENTS - CLOSED SESSION ITEMS
This me is reserved for members of the public to address the City Council on Closed Session Items only. Comments must be made in person and are limited to 3 minutes. Comments for items on the Open Session agenda will be taken when the item is called in Open Session. Comments for Items not on the Closed Session or Open Session agenda will be heard during the Open Session Public Comment period.

MEETING RECESS - COUNCIL TO CONVENE IN CLOSED SESSION
5:30 P.M. CLOSED SESSION ITEMS

1. Conference with Legal Counsel - Exis!ng Li!ga!on. Authorized pursuant to Government Code Section 54956.9(d)(1):
a. City of American Canyon v. City of Vallejo, et al. (Sacramento Superior Court Case No. 34-2022-00327471).
b. City of American Canyon v. Leon Dale Schmidt (Napa County Superior Court Cases No. 22CV001041 and 23PR00161).
c. Center for Biological Diversity v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000511).
d. Golden State Environmental Jus!ce Alliance v. City of American Canyon et al. (Napa Superior Court Case No. 23CV000510).
e. City of Vallejo v. City of American Canyon et al . (Napa County Superior Court Case No. 23CV000517).
f. City of Vallejo v. City of American Canyon et al . (Napa County Superior Court Case No. 23CV001600).

2. Conference with Legal Counsel – An!cipated Li!ga!on. Authorized pursuant to Government Code Section 54956.9 (d)(2). Three (3) Matters. 6:30 P.M. OPEN SESSION - REGULAR MEETING

CALL TO ORDER - COUNCIL TO RECONVENE IN OPEN SESSION

PLEDGE OF ALLEGIANCE

ROLL CALL - OPEN SESSION

REPORT ON CLOSED SESSION/CONFIRMATION OF REPORTABLE ACTION

PROCLAMATIONS AND PRESENTATIONS
CITY COUNCIL MEETING AGENDA APRIL 2, 2024
2 3. Proclamation - Sexual Assault Awareness Month

4. Proclamation - April 2024 as Arts Month

PUBLIC COMMENTS - ITEMS NOT ON CLOSED SESSION OR OPEN SESSION AGENDA This me is reserved for members of the public to address the City Council on items that are not on the Closed Session or Open Session agenda and are within the subject ma(er jurisdicon of the City Council. Comments are limited to 3 minutes. Comments for items on the Open Session agenda will be taken when the item is called in Open Session.The City Council is prohibited by law from taking any acon on ma(ers discussed that are not on the agenda, and no adverse conclusions should be drawn if the City Council does not respond to public comment at this time.

AGENDA CHANGES
The Mayor and Council may change the order of the Agenda or request discussion of a Consent Item. A member of the Public may request discussion of a Consent Item by making that request during Public Comment.

CONSENT CALENDAR

5. Minutes of March 19, 2024
Recommendation: Approve the minutes of the Regular City Council mee"ng of March 19, 2024.

6. Report Upon Return from Closed Session
Recommendation: Approve the Report Upon Return from Closed Session for the Regular City Council meeting of March 19, 2024.

7. Amendment No. 1 of the Melvin Road Sidewalk and Drainage Project (TR24-0200) Recommendation: Adopt a Resolu"on authorizing the City Manager to execute Amendment No. 1 to Agreement No. 2023-10 with Coastland Civil Engineering, Inc., in the amount of $19,390, for a total contract amount not to exceed $156,832, for the Melvin Road Sidewalk and Drainage Project (TR24-0200).

8. Housing Element Municipal Code Updates
Recommendation: Waive final reading, read by "tle only, and adopt an Ordinance by the City Council of the City of American Canyon amending American Canyon Municipal Code (ACMC) Chapter 19.39 Accessory Dwelling Units, and addi"onal ACMC amendments consistent with current State Law and Housing Element Implementation Program C.

9. CalOES Designation
Recommendation: Adopt a Resolu"on designa"ng the Authorized Agents with California Governor's Office of Emergency Services (CalOES) for the purpose of obtaining federal and state financial assistance for emergencies.

PUBLIC HEARINGS

10. Utility Rate Increases - Proposition 218 "Protest Hearing" Recommendation: Take the following actions related to utility rates:

1. Open the Public Hearing, receive public comment, and then close the Public Hearing; CITY COUNCIL MEETING AGENDA APRIL 2, 2024
3 2. Determine whether a majority of property owners have submitted written protests;

3. Waive first reading and adopt by "tle only an Ordinance amending City of American Canyon Municipal Code (ACMC) Chapter 13.06: "Water Rates and Connec"on Fees", Chapter 13.14 "Water Conserva"on Plan", and Chapter 14.04: "Wastewater Rates and Charges" to establish new potable water, recycled water and wastewater property related fees and charges.

BUSINESS

11. New 'Environmental Sustainability' Goal
Recommendation: Adopt a Resolu"on approving a new 'Environmental Sustainability' Goal and various strategies.

MANAGEMENT AND STAFF ORAL REPORTS

MAYOR/COUNCIL COMMENTS AND COMMITTEE REPORTS
The Mayor and Council may comment on ma(ers of public concern and announce ma(ers of public interest; no collective council action will be taken.

12. City Council Committee Report - Councilmember Mark Joseph

FUTURE AGENDA ITEMS

13. Future Agenda Items of Note

ADJOURNMENT

CERTIFICATION
I, Taresa Geilfuss, City Clerk for the City of American Canyon, do hereby declare that the foregoing agenda of the City Council was posted in compliance with the Brown Act prior to the meeting date. ______________________________________
Taresa Geilfuss, CMC, City Clerk
CITY COUNCIL MEETING AGENDA APRIL 2, 2024
4 CITY OF AMERICAN CANYON

PROCLAMATION
Sexual Assault Awareness Month - April 2024
WHEREAS, NEWS, Domestic Violence and Sexual Abuse Services is commemorating 42 years of service to survivors of domestic violence and sexual abuse in Napa County, and having opened as the county’s Rape Crisis Center in 2010 to provide safety to those experiencing sexual abuse; and
WHEREAS, Sexual Assault Awareness Month is about promoting safety, respect and equality, and standing up and speaking out against harmful cultural norms and attitudes that allow sexual violence to persist. This year’s national campaign of “Building Connected Communities” helps us reduce the likelihood of sexual abuse, assault, and harassment in our communities.

WHEREAS, rape, sexual assault, and sexual harassment harm our community. Statistics from the U.S. Center of Disease Control shows that over half of women and almost 1 in 3 men have experienced sexual violence involving physical contact during their lifetimes; and, that 1 in 4 women and about 1 in 26 men have experienced completed or attempted rape. Sexual violence disproportionately affects women, minors, and racial and ethnic minority groups who experience a higher incidence of sexual violence; and
WHEREAS, by observing April as Sexual Assault Awareness Month we show that our community is committed to supporting survivors and working toward the prevention of sexual violence across generations; and WHEREAS, in Fiscal Year 2022/2023 NEWS provided services to nearly 1,800 of our Napa County community members— of which 271 were survivors of sexual abuse, and nearly half of those were minors—including 24-hour response and crisis intervention, financial aid, and advocacy, accompaniment and assistance of civil and criminal justice proceedings, referrals, and support completing victim compensation applications; and WHEREAS, in Fiscal Year 2022/2023, NEWS served 142 clients from the city of American Canyon, including children, 34 of which experienced sexual assault. The NEWS Help Line received 162 calls for assistance from American Canyon residents. Clients from American Canyon received emergency assistance and crisis intervention services; court advocacy and accompaniment, including help preparing and filing restraining orders; and support from our Sexual Assault Victim Services (SAVS) program.

NOW, THEREFORE I, Leon Garcia, Mayor of the City of American Canyon, on behalf of the American Canyon City Council, join NEWS, advocates, and communities across the country in taking action to proclaim April 2024 as Sexual Assault Awareness Month, in American Canyon, and I ask the entire community to join in their effort, not only in April, but all year long, to be part of the effort to end sexual violence.

Dated: April 2, 2024
__________________________
Leon Garcia, Mayor
5 CITY OF AMERICAN CANYON

PROCLAMATION
APRIL 2024 AS ARTS MONTH
WHEREAS, the arts – including visual and performing arts, literature, music, and crafts are essential facets of a vibrant, dynamic community, enriching the lives of those who partake in and appreciate them; and
WHEREAS, the celebration of arts during the month of April recognizes the contributions of artists and art organizations, and encourages public participation in the arts; and WHEREAS, the arts play a critical role in the cultural, educational, and economic vitality of our community, fostering creativity, innovation, and unity across diverse populations; and WHEREAS, through workshops, exhibitions, performances, and readings, Arts Month will showcase the rich tapestry of artistic talent within our community, offering a platform for artists to inspire and be inspired; and
WHEREAS, engaging with the arts during April will not only enhance our appreciation for the myriad ways in which art enriches our lives but also highlight the importance of supporting arts throughout the year; and
WHEREAS, The American Canyon Arts Foundation, one of the oldest community organizations in American Canyon, continuesto maintain, enhance, and support the role of arts in our community by bringing artists and community members together through recreational, cultural, and economic art events, programs, and shows.

NOW, THEREFORE, BE IT RESOLVED, that I, Leon Garcia, Mayor of the City of American Canyon on behalf of the City Council, do proclaim April as Arts Month in American Canyon and call upon our community to celebrate and participate in the arts. Let us recognize and support the artists and arts organizations that contribute to the cultural wealth of our community, and let us encourage each other to explore, experience, and express our creativity through the arts.

Dated: April 2, 2024 ____________________________________ Mayor Leon Garcia
6 CITY OF AMERICAN CANYON

REGULAR CITY COUNCIL MEETING

ACTION MINUTES
March 19, 2024
5:30 P.M. – CLOSED SESSION

CALL TO ORDER - CLOSED SESSION
The meeting was called to order at 6:40 p.m.

ROLL CALL - CLOSED SESSION

Present: Councilmember Mariam Aboudamous, Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia

Absent: None
Excused: Vice Mayor David Oro
Councilmember Mariam Aboudamous is participating by teleconference under the provisions of AB2449.

PUBLIC COMMENTS - CLOSED SESSION ITEMS
Mayor Garcia called for public comments. Written comments: none. Oral comments: none. The public comments period was closed.

MEETING RECESS - COUNCIL TO CONVENE IN CLOSED SESSION
5:30 P.M. CLOSED SESSION ITEMS

1. Conference with Legal Counsel - Existing Litigation. Authorized pursuant to Government Code Section 54956.9(d)(1):
a) City of American Canyon v. City of Vallejo, et al. (Sacramento Superior Court Case No. 34- 2022-00327471).
b) City of American Canyon v. Leon Dale Schmidt (Napa County Superior Court Cases No. 22CV001041 and 23PR00161).
c) Center for Biological Diversity v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000511).
d) Golden State Environmental Justice Alliance v. City of American Canyon et al. (Napa Superior Court Case No. 23CV000510).
e) City of Vallejo v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000517).
7 f) City of Vallejo v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV001600).

2. Conference with Legal Counsel – Anticipated Litigation. Authorized pursuant to Government Code Section 54956.9 (d)(2). Three (3) Matters.
6:30 P.M. OPEN SESSION - REGULAR MEETING

CALL TO ORDER - COUNCIL TO RECONVENE IN OPEN SESSION
The City Council meeting was called to order at 6:30 p.m.

PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was recited.

ROLL CALL - OPEN SESSION

Present: Councilmember Mariam Aboudamous, Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia

Absent: None
Excused: Vice Mayor David Oro
Councilmember Mariam Aboudamous is participating by teleconference under the provisions of AB2449.

REPORT ON CLOSED SESSION/CONFIRMATION OF REPORTABLE ACTION A report on Closed Session and confirmation of reportable action was given by City Attorney William Ross.

PROCLAMATIONS AND PRESENTATIONS

3. Presentation - American Canyon High School Link Crew Council received a presentation from Linda Colin Juradu and Sarah Satake of the American Canyon High School Link Crew.

4. Presentation - Napa Valley Transportation Authority
Council received a Measure U presentation from Kate Miller, Executive Director of Napa Valley Transportation Authority with Addrell Coleman, Assistant Program Planner/Analyst and Danielle Schmitz, Director – Capital Development & Planning.

Councilmember Mariam Aboudamous left the meeting at 7:00 p.m. 8 5. Proclamation - March 25, 2024, Holi in American Canyon Mayor Garcia announced the proclamation. It was received by Arvind Nischal, who shared pictures of past Holi events and provided a cake to share.

The meeting recessed for 15 minutes to share cake provided by Arvind Nischal.

PUBLIC COMMENTS - ITEMS NOT ON CLOSED SESSION OR OPEN SESSION AGENDA Mayor Garcia called for public comments. Written comments: none. Oral comments: Jeanette Goyetche was called to speak; Hugh Marquez was called to speak; Beth Marcus was called to speak; Ken Leary was called to speak. The public comments period was closed.

AGENDA CHANGES
There were no changes to the agenda.

CONSENT CALENDAR
Action: Motion to adopt CONSENT CALENDAR made by Councilmember Mark Joseph, seconded by Councilmember Pierre Washington, and CARRIED by roll call vote.

Ayes: Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia
Nays: None
Abstain: None
Excused: Councilmember Mariam Aboudamous, Vice Mayor David Oro

6. Minutes of March 5, 2024
Action: Approved the minutes of the Regular City Council meeting of March 5, 2024.

7. Report Upon Return from Closed Session
Action: Approved the Report Upon Return from Closed Session for the meeting of March 5, 2024.

8. Electric Vehicle Charging Stations
Action: Adopted Resolution 2024-19 adding Capital Improvement Project Electric Vehicle Charging Stations (CF24-0100); Authorizing a project budget of $230,526 for CF24-0100; Authorizing a purchase order (Agreement 2024-33) with Beam Global for a not to exceed amount of $190,000; and Authorizing the City Manager to execute the purchase order.

9. Green Island Road Project Amendments and CFD Financing Action: Adopted Resolution 2024-20 authorizing the City Manager to execute Amendment #7 (Agreement 2024-34) to Agreement 2016-15 with CONSOR North America, Inc., in the amount of $383,500 for design services, for a total contract amount not to exceed $1,414,030, in conjunction with the Green Island Road Reconstruction and Widening Project (TR16-0700); 9 Adopted Resolution 2024-21 authorizing the City Manager to execute Amendment #2 (Agreement 2024-35) to Agreement 2022-A166 with CONSOR North America, Inc., in the amount of $100,000 for construction management services, for a total contract amount not to exceed $350,000, in conjunction with the Green Island Road Rule 20 A/B Utility Undergrounding Project (TR16-0703); and
Adopted Resolution 2024-22 authorizing the City Manager to engage the financing team related to the second issuance of special tax bonds for and on behalf of the City of American Canyon Community Facilities District No. 2018-1, in conjunction with the Green Island Road Reconstruction and Widening Project (TR16-0700).

10. Increase Project Budget for the Adult Activity Center Flooring Replacement Action: Adopted Resolution 2024-23 increasing the project budget for the Adult Activity Center Flooring Replacement (PR23-0900) from $50,000 to $80,000 and authorizing a budget transfer from Civic Facilities Renovation and Replacement Fund in the amount of $30,000 to PR23-0900.

PUBLIC HEARINGS

11. General Plan and Housing Element Annual Reports and Housing Element Municipal Code Updates
Council received a staff report and presentation from Community Development Director Brent Cooper and Senior Planner William He. Mayor Garcia opened the public hearing and called for public comments. Written comments: none. Oral comments: none. Public comments and the public hearing were closed.

Action: Motion to adopt Waived first reading, read by title only, and adopt an Ordinance by the City Council of the City of American Canyon amending American Canyon Municipal Code (ACMC) Chapter 19.39 Accessory Dwelling Units, and additional ACMC amendments consistent with current State Law and Housing Element Implementation Program C made by Councilmember Pierre Washington, seconded by Councilmember Mark Joseph, and CARRIED by roll call vote.

Ayes: Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia
Nays: None
Abstain: None
Excused: Councilmember Mariam Aboudamous, Vice Mayor David Oro Action: Motion to adopt Receive and File 2023 Calendar Year General Plan and Housing Element Progress Reports made by Councilmember Mark Joseph, seconded by Councilmember Pierre Washington, and CARRIED by roll call vote. 10 Ayes: Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia
Nays: None
Abstain: None
Excused: Councilmember Mariam Aboudamous, Vice Mayor David Oro

BUSINESS

12. Parks and Recreation Department User Fee Schedule
Council received a staff report and presentation from Parks & Recreation Director Alexandra Ikeda. Mayor Garcia called for public comments. Written comments: none. Oral comments: Ken Leary was called to speak; Fran Lemos was called to speak; Clarence Mamaril was called to speak; Hugh Marquez was called to speak. The public comments period was closed.

Action: Motion to adopt Resolution 2024-23 of the City Council of the City of American Canyon to repeal and replace Resolution 2023-30 with the updated Parks and Recreation Department User Fee Schedule made by Councilmember Mark Joseph, seconded by Councilmember Pierre Washington, and CARRIED by roll call vote.

Ayes: Councilmember Mark Joseph, Councilmember Pierre Washington, Mayor Leon Garcia
Nays: None
Abstain: None
Excused: Councilmember Mariam Aboudamous, Vice Mayor David Oro

13. 2023 Annual Communications Report
Council received a staff report and presentation from Communications Manager Jen Kansanback. Mayor Garcia called for public comments. Written comments: none. Oral comments: Clarence Mamaril was called to speak; Melissa Lamattina was called to speak. The public comments period was closed.

14. American Canyon Police Department Annual Report
Action: Receive and file the American Canyon Police Department’s 2023 Annual Report.

Council received a staff report and presentation from Police Chief Rich Greenberg. Mayor Garcia called for public comments. Written comments: none. Oral comments: Beth Marcus was called to speak; Clarence Mamaril was called to speak. The public comments period was closed.

MANAGEMENT AND STAFF ORAL REPORTS
Council received an oral update from Environmental Services Manager Pam Phillips. Mayor Garcia called for public comments. Written comments: none. Oral comments: none. The public comments period was closed.

Parks & Recreation Director Alexandra Ikeda announced upcoming community events.

MAYOR/COUNCIL COMMENTS AND COMMITTEE REPORTS
Council members announced items of interest.
11 FUTURE AGENDA ITEMS

16. Future Agenda Items of Note:

April 2, 2024; 6:30 p.m.

Proclamation National Fair Housing Month
Proclamation April Arts Month
Proclamation Sexual Assault Awareness
Utility Rate Protest Hearing
Traffic Calming Program Update
New Sustainability Goal, Strategies, and 2024 Key Initiatives

April 16, 2024; 6:30 p.m.

Proclamation - April Volunteer Week
Proclamation - Earth Day
Proclamation - National Building Safety Month
Presentation - Spirit Horse
Presentation - ACPD Cadets
Police Services Agreement
Proposed Staffing Plan - FY 24/25 and Beyond

May 7, 2024; 6:30 p.m.

Presentation - Municipal Clerk Week
Proclamation - Older Americans Month
Presentation - Historic Preservation Month
Presentation - CalGreen Building Code
2024 Water Supply Update

May 21, 2024: 6:30 p.m.

Proclamation - Memorial Day
Proclamation - Public Works Week
Proclamation - Bike Month
Presentation - Juneteenth 2023 Event
Proposed FY 24/25 Budget
Kids Commerce Fee Waiver

ADJOURNMENT
The meeting was adjourned at 9:41 p.m. in honor of Cecil Shaver.

CERTIFICATION
Respectfully Submitted,
_____________________________________
Taresa Geilfuss, City Clerk
12 CityofAmericanCanyon.org/Meetings
MARCH 19, 2024 CITY COUNCIL MEETING
View
presentations,
agenda
packets and
meeting
details:

City Council
Community Update
Proclamations & Accolades
Holi: Proclamation received by Arvind Nischal,
founder of Helping Hand Indo-American.

City Action
Received and filed the 2023 Calendar Year General
Plan and Housing Element Progress Reports.

Adopted an Ordinance amending American Canyon
Municipal Code (ACMC) Chapter 19.39 Accessory
Dwelling Units, and additional ACMC amendments
consistent with current State Law and Housing
Element Implementation Program C.

Adopted a Resolution to repeal and replace
Resolution 2023-30 with the updated Parks and
Recreation Department User Fee Schedule.

Utility Rate Public Hearing
Traffic Calming Program Update
New Sustainability Goal,
Strategies and 2024 Key
Initiatives
Next time...

JoinourApril 2
meetingtolearn
moreabout:

Presentations
Received presentation on
2023 Annual
Communications Report
Received presentation on
2023 ACPD Annual
Report
Received quarterly update
presentation from the
Maintenance & Utilities
Department
13 William D. Ross
David P. Schwarz
Kypros G. Hostetter
Christina M. Bellardo
Law Offices of
William D. Ross
400 Lambert Avenue
Palo Alto, California 94306
Telephone: (650) 843-8080
www.lawross.com
Los Angeles Office:
11420 Santa Monica Blvd
#25532
Los Angeles, CA 90025
File No: 199/6
March 25, 2024

VIA E-MAIL
The Honorable Leon Garcia, Mayor
and Members of the City Council
City of American Canyon
4381 Broadway, Suite 201
American Canyon, CA 94503
Re: Report Upon Return from Closed Session; Regular City Council Closed Session Meeting of the American Canyon City Council of March 19, 2024 Dear Mayor Garcia and Members of the City Council:

This communication sets forth reportable action, if any, of the City Council (“Council”) of the City of American Canyon (“City”), consistent with provisions of the Ralph M. Brown Opening Meeting Act (Government Code Section 54950, et seq.) resulting from the Closed Session of the Regular City Council Closed Session Meeting of March 19, 2024, consistent with Government Code Section 54957.1.

Mayor Leon Garcia called the meeting to order in Open Session at 5:30 p.m. and ascertained that there were no public comments on the matters agendized for Closed Session consideration. Additionally, Council Member Aboudamous indicated that she requested to participate remotely consistent with AB 2449, using one of two just cause exceptions because of illness. With a quorum being present, the Council then adjourned at 5:31 p.m. to address the matters agendized for Closed Session consideration.

There were two matters agendized for City Closed Session consideration:

1. Conference with Legal Counsel – Existing Litigation
Authorized Pursuant to Government Code Section 54956.9(d)(1):
a. City of American Canyon v. City of Vallejo, et al.
(Sacramento Superior Court Case No. 34-2022-00327471);
b. City of American Canyon v. Leon Dale Schmidt, (Napa
County Superior Court Case No. 22CV001041 and
23PR00161);
14 The Honorable Leon Garcia, Mayor
and Members of the City Council
March 25, 2024

Page 2 ends

c. Center for Biological Diversity v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000511); d. Golden State Environmental Justice Alliance v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000510);
e. City of Vallejo v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV000517); and,
f. City of Vallejo v. City of American Canyon et al. (Napa County Superior Court Case No. 23CV001600).

2. Conference with Legal Counsel – Anticipated Litigation Authorized Pursuant to Government Code Section No. 54956.9(d)(2) Three (3) Matters.

With respect to Closed Session Agenda Item No. 1.a., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).

With respect to Closed Session Agenda Item No. 1.b., there was reportable action in that the Public Guardian, Joseph Cherry, indicated that additional debris would be removed from the property and that additional assets of Mr. Schmidt had been located and that they anticipated an agreement for repayment of the City’s lien on the property upon further specification of financial capability and amounts involved. Except as indicated, there was no other reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).

With respect to Closed Session Agenda Item No. 1.c. through 1.e, there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).

With respect to Closed Session Agenda Item No. 1.f., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).

With respect to Closed Session Agenda Item No. 2., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(2) with respect to each of the three matters considered.

Upon conclusion of consideration of the three matters agendized under Closed Session 15 The Honorable Leon Garcia, Mayor
and Members of the City Council
March 25, 2024

Page 3 ends

Agenda Item No. 2., it was unanimously (4-0) approved that an additional matter for Closed Session consideration be added to the Closed Session Agenda. With respect to that additional matter for Closed Session consideration, there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(2).

During consideration of the additional Closed Session Item from 6:09 p.m. to 6:18 p.m., neither the City Manager Jason Holley, nor the City Attorney William Ross, were present in the Council Closed Session consideration.

Your Council concluded the Closed Session at 6:20 p.m.

In Open Session, it was indicated that a written report upon return from Closed Session consistent with Government Code Section 54957.1, would be prepared concerning the matters agendized for Closed Session.

This communication should be reviewed under the Consent portion of the Agenda of your next Regular or Special City Council Meeting.

Should you have questions concerning this Report, it may be taken off the Consent calendar when agendized in the future, or our office may be contacted in the interim.

Very truly yours,
William D. Ross
City Attorney
WDR:jf
cc: Jason B. Holley, City Manager
Maria Ojeda, Assistant City Manager
Taresa Geilfuss, City Clerk
Cherri Walton, Deputy City Clerk
16 CITY COUNCIL AGENDA
APRIL 2, 2024

STAFF REPORT

CONSENT
ITEM NUMBER: 7.

TITLE
Amendment No. 1 of the Melvin Road Sidewalk and Drainage Project (TR24-0200)

RECOMMENDATION
Adopt a Resolu1on authorizing the City Manager to execute Amendment No. 1 to Agreement No. 2023-10 with Coastland Civil Engineering, Inc., in the amount of $19,390, for a total contract amount not to exceed $156,832, for the Melvin Road Sidewalk and Drainage Project (TR24-0200).

CONTACT
Erica Ahmann Smithies, P.E., Public Works Director

BACKGROUND & ANALYSIS
On March 15. 2022, City Council approved Resolu1on No. 2022-27 appropria1ng approximately $500,000 of American Rescue Plan Act (ARPA) funding to the Melvin Road Sidewalk and Drainage Project (TR24-0200). Melvin Road is one of six capital projects iden1fied in Resolu1on No. 2022-27 to receive a portion of the City's ARPA funding.

There are two main improvement components to the Melvin Road project. The first component is to provide addi1onal sidewalk and pedestrian connec1vity within the City’s right-of-way on both sides of Melvin Road between Cassayre Drive and James Road. The project will also close a couple of sidewalk gaps along the east side of James Road between Wilson Way to Donaldson Way.

Comple1ng the sidewalk gap along Melvin Road will provide more access for residents in the area to the adjacent schools, commerce, and facili1es in the surrounding areas. The second component of this project is to install addi1onal storm drain infrastructure that will improve the area’s hydrology and resiliency during storm events. Following the survey and preliminary design, the consultant will engage with the City to discuss whether additional right of way is needed to complete the project.

On February 7, 2023, City Council approved Agreement No. 2023-10 with Coastland Civil Engineering, Inc. (Coastland) to provide design services specific to the Melvin Road Project for an amount not to exceed $137,442. Considerable design progress has been made this past year but addi1onal field surveying and design work is necessary to realign the proposed storm drain alignment to avoid shallow u1lity conflicts (i.e. water and gas services) that will significantly increase construc1on costs. The addi1onal design work iden1fied will assist with mi1ga1ng conflicts encountered during construc1on for an addi1onal 1me and materials amount not to exceed 17 $19,390. The final plans and specifica1ons are an1cipated to be completed by early April so that the project can then be advertised by May 2024.

COUNCIL PRIORITY PROGRAMS AND PROJECTS
Infrastructure: "Develop and maintain infrastructure resources to support sustainable growth."

FISCAL IMPACT
The funding request is to increase the approved agreement from $137,442 to a new not to exceed amount of $156,832. The Melvin Road Sidewalk and Drainage Project (TR24-0200) has sufficient funding to approve the increase. The project has an adopted FY23/24 budget of $1,050,000 which is comprised of $500,000 in ARPA funds and $550,000 of Measure A funds.

ENVIRONMENTAL REVIEW
15301 - The Project is exempt from review under the California Environmental Quality Act ("CEQA") under the Class 1 exemp1on of exis1ng facili1es of Sec1on 15301 of Title 14 of the California Code of Regula1ons and said exemp1on is not negated by any excep1on under Sec1on 15300.2 of said Regulations.

ATTACHMENTS:

1. Resolution Coastland
18 RESOLUTION NO. 2024-______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON AUTHORIZING THE CITY MANAGER TO EXECUTE AMENDMENT NO. 1 TO AGREEMENT NO. 2023-10 WITH COASTLAND CIVIL ENGINEERING, INC., IN THE AMOUNT OF $19,390, FOR A TOTAL CONTRACT AMOUNT NOT TO EXCEED $156,832, FOR THE MELVIN ROAD SIDEWALK AND DRAINAGE PROJECT (TR24-0200) WHEREAS, the Melvin Road Sidewalk and Drainage Project will close a significant sidewalk gap to both sides of Melvin Road between Cassayre Drive and James Road, eliminate two sidewalk gaps along the east side of James Road to Donaldson Way and provide storm drain infrastructure that will improve the area’s hydrology and resiliency during storm events; and
WHEREAS, on February 7, 2023, City Council authorized the City Manager to execute Agreement No. 2023-10 with Coastland Civil Engineering to design the Melvin Road Sidewalk and Drainage Project (TR24- 0200) for an amount not to exceed $137,442; and
WHEREAS, considerable design progress has been made this past year but additional field surveying and design work is necessary to realign the proposed storm drain alignment to avoid shallow utility conflicts (i.e. water and gas services) that will significantly increase construction costs; and WHEREAS, Coastland has provided a proposal to complete the additional work in the amount of $19,390 for a new contract not to exceed amount of $156,832; and WHEREAS, there is sufficient funding available in the FY23/24 project budget.

NOW, THEREFORE, BE IT FURTHER RESOLVED that the City Council of the City of American Canyon hereby authorizes the City Manager to execute Amendment No. 1 to Agreement No. 2023-10 with Coastland Civil Engineering, Inc., in the amount of $19,390, for a total contract amount not to exceed $156,832, for the Melvin Road Sidewalk and Drainage Project (TR24-0200).

PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 2nd day of April, 2024 by the following vote:

AYES:

NOES:

ABSTAIN:

STAFF REPORT

CONSENT
ITEM NUMBER: 8.

TITLE
Housing Element Municipal Code Updates

RECOMMENDATION
Waive final reading, read by ,tle only, and adopt an Ordinance by the City Council of the City of American Canyon amending American Canyon Municipal Code (ACMC) Chapter 19.39 Accessory Dwelling Units, and addi,onal ACMC amendments consistent with current State Law and Housing Element Implementation Program C.

CONTACT
Brent Cooper, AICP, Community Development Director

BACKGROUND & ANALYSIS
On March 19, 2024, the City Council approved the first reading of an Ordinance approving Municipal Code updates to reduce constraints to housing produc,on including an update to the Accessory Dwelling Unit Ordinance.

Municipal Code updates include the following:
1 . Allow low barrier naviga,on centers as a permi8ed use in the Community Commercial (CC) zoning district in compliance with Government Code Section 65660 and 65668.

A Low Barrier Naviga,on Center is a temporary living facility with case managers that help people experiencing homelessness connect with resources to move into permanent housing. The code amendment would permit this form of housing in the Community Commercial zoning district.

2. Allow small residen,al care facili,es as a permi8ed use in the Rural Residen,al Estate Hillside (RRH) zoning district in compliance with Government Code Section 65583.

A Small Residen,al Care facility is a home for six or fewer persons in need of personal services, supervision, protec,on or assistance essen,al for sustaining the ac,vi,es of daily living, or twentyfour-hour care for six or fewer foster children. Per State Law, this facility is already permi8ed in all single family zoning districts. The Rural Residen,al Estate Hillside zoning district (Canyon Estates) 20 was overlooked and will be corrected with this zoning code amendment.

3. Allow manufactured housing subject only to the restrictions of single-family uses .

Manufactured housing is pre-assembled in a factory and delivered to a property on a permanent founda,on. This zoning code amendment would remove approval criteria and subjec,ve design standards that does not exist for "stick-built" single family homes.

Examples of subjective approval criteria standards to remove from the zoning code include:
“harmonious with context of surrounding neighborhood.”
“compatibility in design and appearance with residences in the vicinity.” “protect neighborhood integrity.”
“harmonious relationships between manufactured homes and surrounding uses, etc.” Examples of design standards to remove from the zoning code include:
“exterior siding material compatible with adjacent residential structures.” “shiny or metallic finishes are prohibited.”
“a specific roof material.”
“eaves or roof overhangs of not less than one foot.”
“finished floor elevation no higher than twenty inches above the exterior finished grade.” “exterior materials and roofing proposed for any garage shall be the same as those materials used on the main structure.”

4. Update Floor Area Ra,o (FAR) standards in the Neighborhood Commercial (CN) and Community Commercial (CC) zoning districts to allow a minimum Floor Area Ra,o (FAR) of 1.0 for projects with three to seven units or 1.25 for projects with eight to 10 units.

This new standard is required by Government Code Sections 54237, 54237.7, and 54239.4. 5 . Remove the condi,onal use permit requirement for large farm employee housing in the Community Commercial CC zoning district.

The Employee Housing Act (Division 13, Part 1 of the Health and Safety Code) requires employee (farmworker) housing consis,ng of 12 units, or 36 beds must be permi8ed by right. The City allows larger farmworker housing in the Community Commercial CC zoning district with a condi,onal use permit. The zoning code amendment would remove the conditional use permit requirement. 6 . Update the Accessory Dwelling Unit Ordinance (American Canyon Municipal Code (ACMC) Chapter 19.39) consistent with an October 4, 2023 State of California Department of Housing and Community Development (HCD) letter.

The HCD le8er iden,fies a variety of amendments needed to ensure the Accessory Dwelling Unit 21 Ordinance remains in compliance with State Law. A copy of the HCD is included as A8achment 6. A summary of changes identified in the HCD letter include the following:

Technical language cleanups, such as:

Amend definitions to Specific “One” ADU instead of “additional” ADUs.

Add allowance of a multifamily ADU concurrent or after the multifamily is built.

An ADU size is unlimited when an accessory structure is converted to an ADU.

Allow 3 ADUs on a parcel: One attached, one detached, and one Junior ADU.

No fire sprinkler is required if the primary residence does not have fire sprinklers regardless of how large the ADU addition is.

ADUs cannot be denied if there are unrelated code violations on the property.

Junior ADU standards are revised to become more lenient, such as:

No limits on electric service.

No prohibition of propane or natural gas appliances.

Subjec,ve language removed “food prepara,on area and cabinets are reasonable size in relationship to the JADU”.

No limit on kitchen sink waste line.

Parking Standards Reduced, such as:

No parking required when car share vehicle is located within one block.

No parking required when the ADU applica,on is submi8ed at the same ,me for a SFD or MFD.

Subjective Design Standards removed, such as:
“Compatibility of accessory dwelling units with the neighborhood.” “Comply with any City adopted objective design standards applicable to ADUs.” Approval Standards:

City must approve or deny an ADU application within 60 days.

If the ADU is denied, we must identify reasons.

If the final reading is approved, the Ordinance will become effec,ve 30 days later on May 2, 2024. A copy of the Ordinance is included as Attachment 1.

COUNCIL PRIORITY PROGRAMS AND PROJECTS
Organizational Effectiveness: "Deliver exemplary government services."

FISCAL IMPACT
The City is required to Municipal Code updates to reduce constraints to housing produc,on.

Comple,on of these municipal code amendments will enable the City to remain consistent with State Housing Laws which are increasingly ,ed to infrastructure and housing-related grant programs.

ENVIRONMENTAL REVIEW
22 The Housing Element Municipal Code Updates are exempt from environmental review under CEQA because the amendments are consistent with State law that preempt any inconsistent local ordinance. Thus, the City’s ac,on is not crea,ng a new land use regula,on and it can be seen with certainty that no environmental impacts will result from the City’s ac,on. Consequently, the ac,on is exempt in accordance with CEQA Sec,on 21084(a) and both Sec,on 15002(i)(1) – lack of Local Jurisdic,onal Discre,on – and Sec,on 15061(b)(3) – General Rule of Exemp,on – of the CEQA Guidelines.

ATTACHMENTS:

1. Ordinance Housing Element Implementation and ADU 2024 23 ORDINANCE NO. 2024-XX

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON AMENDING THE AMERICAN CANYON MUNICIPAL CODE TO UPDATE CHAPTER 19.39 “ACCESSORY DWELLING UNITS” AND ADDITIONAL AMENDMENTS CONSISTENT WITH CURRENT STATE LAW AND

HOUSING ELEMENT IMPLEMENTATION PROGRAM C
WHEREAS, on January 31, 2023, the City Council approved the 6th Cycle Housing Element (Housing Element); and; and
WHEREAS, on June 30, 2023, the State of California Department of Housing and Community Development (HCD) certified the Housing Element; and
WHEREAS, the Housing Element includes certain programs to identify and reduce constraints to housing production; and
WHEREAS, Housing Element Implementation Program C requires certain Municipal Code updates to reduce constraints to housing production, including:

1. Allow low barrier navigation centers in compliance with Government Code Section 65660 and 65668;

2. Allow small residential care facilities as a permitted use in the (RRH) zoning district in compliance with Government Code Section 65583;

3. Allow manufactured housing subject only to the restrictions of single-family uses;

4. Update Floor Area Ratio (FAR) standards in the CN and CC zoning districts to allow a minimum of 1.0 for projects with three to seven units or 1.25 for projects with eight to 10 units;

5. Remove the conditional use permit requirement for large farm employee housing in the CC zoning district; and

6. An amendment to the Accessory Dwelling Unit Ordinance (ACMC Chapter 19.39) to comply with current State law consistent with an October 4, 2023, HCD letter identifying needed amendments; and
WHEREAS, on February 22, 2024, the City of American Canyon Planning Commission conducted a duly noticed public hearing on the Paoli/Watson Lane Annexation Pre-Zoning and Rezoning and recommends City Council approval; and
WHEREAS, on March 19, 2024, the City Council of the City of American Canyon conducted a duly-noticed public hearing on the subject application, at which time all those in attendance were given the opportunity to speak on this proposal and to submit comments.

NOW, THEREFORE, BE IT ORDAINED that the City Council of the City of American Canyon, having considered all the evidence, including any submitted by member of the public, hereby adopts Municipal Code amendments as follows:

SECTION 1: Allow low barrier navigation centers in compliance with Government Code Section 65660 and 65668 as follows:
a. Update American Canyon Municipal Code Section 19.05.040 Residential Classifications to add “Low Barrier Navigation Center” definition as follows:
24 19.05.040 Residential Classifications
Low Barrier Navigation Center: “a Housing First, low-barrier, service-enriched shelter focused on moving people into permanent housing that provides temporary living facilities while case managers connect individuals experiencing homelessness to income, public benefits, health services, shelter, and housing (See Government Code § 65660).
b. Amend American Canyon Municipal Code Section 19.11.040 to add Low Barrier Navigation Center as a permitted use in the CC zoning district as follows:

19.11.040 Permitted uses.

Table 1 of this section sets forth the permitted and conditionally permitted uses for each commercial district. A "P" designates a permitted use. A "C" indicates a conditionally permitted use subject to approval of a use permit by the planning commission. An "M" indicates a minor use permit is required pursuant to Chapter 19.42. If no letter is found opposite a particular use, it is not permitted in that district.

Table 1
Permitted and Conditionally Permitted Uses 1
Community Commercial and Neighborhood Commercial Districts Use Classification Zoning District Related Provision
CC
Residential
Low Barrier Navigation Center P
c. Amend the Broadway District Specific Plan Table 2-3 to add Low Barrier Navigation Center as a permitted use in the Business Park, Downtown Core, and Local Serving Mixed Use zoning districts as follows:

TABLE 2-3: BROADWAY ZONING DISTRICT PERMITTED USES
Use Classification
(Per ACMC Chapter 19.05)
Broadway District Specific Plan Zoning
Broadway District
Residential
Business
Park1
Downtown
Core
Local Serving
Mixed Use
Home
Improvemen
t
Residential
Low Barrier Navigation Center P P P P P
JUSTIFICATION: Assembly Bill (AB) 101 requires cities to allow low barrier navigation centers as a permitted use in mixed use zones and other nonresidential zones that permit multi-family residential development.

SECTION 2: Allow small residential care homes as a permitted use in the (RRH) zoning district in compliance with Government Code Section 65583 as follows:
a. Update American Canyon Municipal Code Section 19.05.040 Residential Classifications to add the word “Small” to the Residential Care Home definition as follows:
25 19.05.040 Residential Classifications
Residential Care Home, Small: provision of twenty-four-hour nonmedical care of six or fewer persons in need of personal services, supervision, protection or assistance licensed by the state essential for sustaining the activities of daily living, or twenty-four-hour care for six or fewer foster children.

Furthermore, Small residential care homes without State license personal services shall also have the same standards and processing as residential care homes. For the purposes of any law or zoning ordinance that relates to the residential use of property pursuant to this chapter, the residents and operators of the facility shall be considered a family. (see Health and Safety Code § 1568.0831). b. Amend American Canyon Municipal Code Section 19.10.040 to add small residential care homes as a permitted use in the RRH zoning district as follows:

19.10.040 Permitted uses.

Table 19.10.040
Permitted and Conditionally Permitted Uses
Residential Districts 1
Use Classification RRH RE RR RS RM RH Related Provision Residential
Residential Care Home, Small P P P P P P
SECTION 3: Amend ACMC Section 19.10.130 to allow manufactured housing subject only to the restrictions of single-family uses.

19.10.130 Manufactured homes.
(A) Intent. It is the intent of the city to provide opportunities for the placement of manufactured homes in single-family residential districts, consistent with state law. (B) Approval. Approval by the community development director is required prior to the issuance of building permits for individual manufactured homes on a site in any residential district, subject to the provisions of this section.
(C) Location. Manufactured homes may be located in any residential district where a single-family detached dwelling is permitted, subject to the same restrictions on density and to the same property development regulations.
(D) Design and Development. Each manufactured home:
(1) Shall be built on a permanent foundation approved by the building official; (2) Shall be certified under the National Manufactured Home Construction and Safety Act of 1974, and shall be installed in accordance with the provisions of the most recent edition of the Uniform California Building Code adopted by the city;
(3) Shall provide skirting of exterior finish materials extending to the finished grade; 26 (4) Shall have roofing material complying with the most recent editions of the Uniform Building Code adopted by the city;
(E) Cancellation of State Registration. Whenever a manufactured home is installed on a permanent foundation, any registration of the manufactured home with the state of California shall be canceled, pursuant to state laws and regulations. Before any occupancy certificate may be issued for use of such a manufactured home, the owner shall provide to the building official satisfactory evidence showing that the state registration of the manufactured home has been or will, with certainty, be canceled; if the manufactured home is new and has never been registered with the state, the owner shall provide the building official with a statement to that effect from the dealer selling the home. (Ord. 2001-02 § 1, 2001.)
SECTION 4: Amend American Canyon Municipal Code Section 19.11.050 to allow a minimum of 1.0 Floor Area Ratio (FAR) standards in the Neighborhood Commercial (CN) and 1.25 FAR in the Community Commercial (CC) zoning districts for residential projects with three to seven dwelling units or for residential projects with eight or more dwelling units as follows:

19.11.050 Development standards.

Table 2 of this chapter sets forth the minimum lot area for each commercial district.

Table 2
Zoning District CN CC
Minimum area per lot 10,000 sq. ft. 1 acre**
Minimum width per lot 100 feet 200 feet
Minimum depth per lot 100 feet 100 feet
Minimum front yard 10 feet 20 feet
Minimum side yard 10 feet 10 feet
Street side of corner lot 10 feet 15 feet
Minimum rear yard 20 feet 10 feet
Minimum setback 40 feet 40 feet
from Hwy. 29 50 feet avg. 50 feet avg.

Density
Nonresidential 0.35 FAR 0.50 FAR
Mixed-use structure 1.5 1.5
Residential portion 1.0 1.0
Commercial portion 0.50 0.50
Residential (3-7 dwelling units) 1.0 FAR Minimum 1.0 FAR Minimum Residential (8 or more dwelling units) 1.5 FAR Minimum 1.5 FAR Minimum Maximum number of stories:

All buildings 2 stories 2 stories
Exceptions:

Residential or mixed-use structures 3 stories 3 stories west of Broadway
27 Zoning District CN CC
Residential, overnight accommodations and lodging
services, or mixed-use structures
N/A 4 stories east of
Broadway
Maximum building height: 30 feet 35 feet
Exceptions:

Residential or mixed-use structures 42 feet 42 feet west of Broadway
Residential, overnight accommodations and lodging
services, or mixed-use structures
N/A 54 feet east of
Broadway
Maximum building coverage for stand-alone residential
uses
50 percent west of
Broadway
50 percent west of
Broadway
60 percent east of
Broadway
60 percent east of
Broadway
SECTION 5: Amend American Canyon Municipal Code Section 19.11.040 to remove the conditional use permit requirement for large farm employee housing in the CC zoning district as follows:

19.11.040 Permitted uses.

Table 1
Permitted and Conditionally Permitted Uses 1
Community Commercial and Neighborhood Commercial Districts Use Classification Zoning District Related Provision
CN CC
Residential
Farm employees housing - P
SECTION 6: Adopt the updated American Canyon Municipal Code Chapter 19.39 “Accessory Dwelling Units” as follows:

Chapter 19.39 ACCESSORY DWELLING UNITS

19.39.010 Purpose of the chapter.

19.39.020 Applicability.

19.39.030 General plan consistency.

19.39.040 Definitions.
28 19.39.050 Development standards—Generally.

19.39.060 Junior accessory dwelling unit standards.

19.39.070 Parking standards.

19.39.080 Operational standards.

19.39.090 Design standards.

19.39.100 Review and approval process.

19.39.110 Code enforcement.

19.39.010 Purpose of the chapter.

The purpose of this chapter is to increase the supply of smaller units and rental housing units by allowing accessory dwelling units on lots containing a single-family dwelling in various residential districts as shown on Table 19.10.040, and to establish design and development standards for accessory dwelling units to ensure that they are compatible with existing neighborhoods and consistent with the general plan and its elements. Accessory dwelling units contribute needed housing to the community’s housing stock. (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.020 Applicability.

The provisions of this chapter apply to all lots that are occupied with a single-family dwelling unit and multifamily dwelling and zoned residential. Accessory dwelling units do not exceed the allowable density for the lot upon which the accessory dwelling unit is located and are a residential use that is consistent with the existing general plan and zoning designation for the lot. (Ord. 2020-04 § 1, 2020; Ord. 2017-05
§ 2, 2017)

19.39.030 General plan consistency.

An accessory dwelling unit that conforms to this chapter shall be deemed to be an accessory use or an accessory building and shall not be considered to exceed the allowable density for the lot upon which it is located and shall be deemed to be a residential use that is consistent with the existing general plan and zoning designations for the lot. The accessory dwelling units shall not be considered in the application of any local ordinance, policy, or program to limit residential growth in accordance with Government Code Section 65852.2(a)(8). (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.040 Definitions.
“Accessory dwelling unit” means any of the following:

1. One dwelling unit attached to, within, or detached from the proposed or existing primary dwelling unit that is on the same parcel in areas zoned to allow single-family and/or multifamily dwelling 29 residential use, and provides permanent and independent provisions for living, sleeping, eating, cooking, and sanitation for one or more persons.

2. An efficiency unit, as defined in Section 17958.1 of the Health and Safety Code.

3. Amanufactured home, as defined in Section 18007 of the Health and Safety Code.

4. Multiple accessory dwelling units up to 25 percent of the existing multifamily dwelling units within portions of existing multifamily dwelling structures that are not used as livable space, including, but not limited to, storage rooms, boiler rooms, passageways, attics, basements, or garages, if each unit complies with state building standards for dwellings, as defined in Government Code section 65852.2, subdivision (e)(1)(C).
“Junior accessory dwelling unit” means one accessory dwelling unitthat is 500 square feet or less that is contained entirely in the primary residence or within an attached garage. “Primary residence” means the residential dwelling that existed on the parcel before or constructed concurrent with the accessory dwelling unit. (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.050 Development standards—Generally.

A. Each accessory dwelling unit requires approval of a building permit.

B. The applicant of each accessory dwelling unit building permit application shall identify the anticipated rent and household size of the new accessory dwelling unit.

C. One detached accessory dwelling unit, one attached accessory dwelling unit, and one junior accessory dwelling unit are permitted per single-family parcel.

D. A multi-family or single-family primary residence dwelling must exist on the parcel before the accessory dwelling unit is built or it shall be built concurrently with the accessory dwelling unit.

E. Accessory dwelling units shall comply with the lot area, yard setback, height, and building coverage standards of the applicable residential zoning district as described in Section 19.10.050 except for the following:

1. The accessory dwelling unit is built in the garage and the garage setback is closer than the setback for the primary residence.

2. Ifthe accessory dwelling unitis builtin a previously-permitted existing accessory structure, the existing accessory structure setbacks apply and not the setbacks for a single-family house.

3. Development standards shall be waived to permit a detached accessory dwelling unit that is no greater than eight hundred square feet, and has four-foot setbacks.

4. The maximum ADU height depends on these conditions:
i. A height of 16 feet for a detached accessory dwelling unit on a lot with an existing or proposed single family or multifamily dwelling unit. ii. A height of 18 feet for a detached accessory dwelling unit on a lot with an existing 30 or proposed single family or multifamily dwelling unit that is within one-half of one mile walking distance of a major transit stop or a high-quality transit corridor, as those terms are defined in Section 21155 of the Public Resources Code. iii. A local agency shall also allow an additional two feet in height to accommodate a roof pitch on the accessory dwelling unit that is aligned with the roof pitch of the primary dwelling unit.
iv. A height of 18 feet for a detached accessory dwelling unit on a lot with an existing or proposed multifamily, multistory dwelling.
v. A height of 25 feet or the height limitation in the local zoning ordinance that applies to the primary dwelling, whichever is lower, for an accessory dwelling unit that is attached to a primary dwelling. This clause shall not require a local agency to allow an accessory dwelling unit to exceed two stories.

5. The applicant shall not be required to correct pre-existing nonconforming zoning conditions that are not related to the ADUas a condition of ADU approval.

F. Accessory Dwelling Living Area Standard.

1. A Detached accessory dwelling unitshall not exceed one 1,200 square feet, unless:
i. On a single-family lot, the detached ADU converts a previously-permitted accessory structure which is greater than 1,200 square feet. In this circumstance, the ADU may equal the square footage of the existing accessory structure. ii. On a lot with a multifamily primary dwelling, the detached ADU is not subject to a square foot limit (Gov. Code, § 65852.2, subds. (e)(1)(A), (C), and (D)).

2. An Attached accessory dwelling unit may occupy up to fifty percent of the primary residence living area but shall not exceed 1,200 square feet.

3. A Junior accessory dwelling unitshall not exceed 500 square feet.

G. Fire Sprinkler Requirements.

1. Accessory dwelling units shall comply with all applicable fire safety provisions of state law as well as locally adopted building and fire codes under Title 16. Examples include, but are not limited to, standards such as water supply and fire department access.

2. Accessory dwelling units shall not be required to be equipped with fire sprinklers unless fire sprinklers are required for the primary residence. For purposes of this requirement, the following standards shall apply:
i. When the primary residence has fire sprinklers, the accessory dwelling unit shall be constructed with fire sprinklers.
ii. When the primary residence does not have fire sprinklers, the junior accessory dwelling unit and attached accessory dwelling unit do not require fire. iii. Detached accessory dwelling units require fire sprinklers unless the primary residence 31 does not have fire sprinklers.

H. Deed Restrictions. Prior to issuing a building permit for an accessory dwelling unit, the property owner shall file with the county recorder, in a format with language approved by the city, a declaration of restrictions containing a reference to the deed under which the property was acquired by the present owner and stating that:

1. The accessory dwelling unitshall not be sold separately.

2. The restrictions are binding upon any successor in ownership of the property.

3. The property owner must occupy as a primary residence one of the two dwelling units on the property, either the primary or accessory dwelling unit except accessory dwelling unit and junior accessory dwelling unit applications submitted between January 1, 2020 to January 1, 2025.

4. When the applicant is a qualified nonprofit housing organization, a deed restriction is not required.

I. Impact Fees.

1. Accessory dwelling unitslessthan 750 square feet are exempt from all city impact fees.

2. Impact fees for accessory dwelling units equal or greater than 750 square feet are exempt from water and sewer capacity fees. All remaining impact fees shall be charged proportionately in relation to the square footage of the primary dwelling unit.

J. Accessory Dwelling Units on Multifamily Dwellings. The building division shallreview and approve ministerially accessory dwelling units under the following conditions.

1. Non-habitable area within an existingmultifamily dwelling structure, including, but notlimited to: storage rooms, boiler rooms, passageways, attics, basements or garages, may be converted to one or more accessory dwelling units if each accessory dwelling unit complies with state dwelling unit building standards.

2. An existing multifamily dwelling shall be permitted to accommodate additional accessory dwelling units in an amount up to twenty-five percent of the existing multifamily dwelling units.

3. An existing multifamily dwelling is permitted a minimum of one accessory dwelling unit up to two detached accessory dwelling units on the same lot. Each detached accessory dwelling unit shall subject to a height limit in accordance with Section 19.35.050(E)(4) and four- foot rear yard and side yard setbacks.

K. CC&Rs. As defined in California Civil Code Section 4751 or any successor statute, any covenant, condition, and restriction (CC&R) or contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of any interest in a planned development, and any provision of a governing document, that effectively prohibits or unreasonably restricts the construction or use of an accessory dwelling unit or junior accessory dwelling unit on a lot zoned 32 for single-family residential use that meets the above-described minimum standards (subsections F and G) established for those units shall be void and unenforceable. (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.060 Junior accessory dwelling unit standards.

A. Each junior accessory dwelling unitshall comply with the following building standards.

1. The dwelling must have its own exterior entrance.

2. The kitchen must include a cooking facility with appliances and includes a food preparation counter and storage cabinets.

3. The bathroom may be included in the unit orshared with the primary residence.

4. Junior accessory dwelling units are exemptfromthe building code wallseparation requirements with the primary residence. (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.070 Parking standards.

A. When accessory dwelling unit parking is required by this chapter or provided at the discretion of the homeowner, parking spaces may be covered or uncovered, provided as tandem parking on an existing driveway or on a paved surface in a setback or yard area.

B. Primary Residence. Parking for the primary residence must comply with Chapter 19.21 except when the garage is converted to a ADU.

C. Detached Accessory Dwelling Unit.

1. Aminimum of one on-site parking space isrequired.

2. Notwithstanding subsection (C)(1), on-site ADU parking is not required when:
i. The detached accessory dwelling unit is located within one-half mile walking distance of public transit or within one block of a car-sharing pickup/drop-off location; and/or ii. The ADU is located within an architecturally and historically significant historic district; and/or
iii. The ADU is part of the proposed or existing primary residence or an accessory structure; and/or
iv. On-street parking permits are required but not offered to the occupant of the ADU; and/or
v. A car share vehicle is located within one block of the accessory dwelling unit; and/or vi. An accessory dwelling unit building permit application is submitted in conjunction with a building permit application for a new single-family dwelling or a new multifamily dwelling on the same lot.

D. Attached Accessory Dwelling Unit. No on-site parking isrequired. 33 E. Junior Accessory DwellingUnit. No on-site parking isrequired.

F. When a garage, carport, or covered parking structure is demolished in conjunction with the construction of an accessory dwelling unit or converted to an accessory dwelling unit, the city shall not require replacement ofthe off-street parking spaces. (Ord. 2020-04 § 1, 2020;Ord. 2017- 05 § 2, 2017)

19.39.080 Operational standards.

A. The accessory dwelling unit may not be sold separately from the primary residence.

B. Owner-Occupancy. The property owner shall reside in either the primary residence or the accessory dwelling unit except accessory dwelling unit and junior accessory dwelling unit applications submitted between January 1, 2020 to January 1, 2025.

C. An accessory dwelling unit may not be rented fortransient occupancy (lessthan thirty consecutive days). (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.090 Design standards.

Accessory dwelling units shall comply with the following standards.

A. An accessory dwelling unit connected to an onsite water treatment system requires a percolation test completed within the lastfive years, or, if the percolation test has been recertified, within the last ten years. (Ord. 2020-04 § 1, 2020; Ord. 2017-05 § 2, 2017)

19.39.100 Review and approval process.

Permits for accessory dwelling units and junior accessory dwelling units shall be reviewed ministerially through the building division in accordance to Government Code Section 65852.2 (a) through (e).

A. The building division shall “shall approve or deny” act on the application to create an accessory dwelling unit orjunior accessory dwelling unit within sixty days from the date the building division receives a completed application if there is an existing single-family or multifamily dwelling on the lot.

B. If the City denies an accessory dwelling unit building permit application, the applicant shall receive a list of application deficiencies that would remedy a subsequent building permit application.

JUSTIFICATION: See HCD Comment #11 related to the City’s obligation to approve or deny an ADU application within 60-days.

A. If the permit application to create an accessory dwelling unit or junior accessory dwelling unit is submitted concurrently with a permit application to create a new single-family dwelling on the lot, the building division may delay acting on the accessory dwelling unit or junior accessory dwelling unit permit application until the building division acts on the new single-family dwelling permit application, but the application to create the accessory dwelling unit or junior accessory dwelling unit shall be considered ministerial without discretionary review or a hearing. If the applicant requests a delay, the sixty-day time period shall be tolled for the period of the delay. (Ord. 2020-04 § 1, 2020)
34 19.39.110 Code enforcement.

For accessory dwelling units built before January 1, 2020, the property owner may request delayed enforcement of building standards for five years.

A. There shall be no delays granted after January 1, 2030.

B. There shall be no delays granted if the delay of the correction will cause a violation needed to protect health and safety. (Ord. 2020-04 § 1, 2020)
SECTION 7. CEQA FINDINGS. The City Council finds the municipal code amendments are exempt from environmental review under CEQA because the amendments are consistent with State law that preempt any inconsistent local ordinance. Thus, the City’s action is not creating a new land use regulation and it can be seen with certainty that no environmental impacts will result from the City’s action. Consequently, and in accordance with CEQA Section 21084(a) and both Section 15002(i)(1) – lack of Local Jurisdictional Discretion – and Section 15061(b)(3) – General Rule of Exemption – of the CEQA Guidelines, the ordinance adoption is exempt from CEQA review and a Notice of Exemption has been prepared for this proposed amendment.

SECTION 8. EFFECTIVE DATE. This ordinance shall become effective effect 30 days after its final passage pursuant to Government Code Section 36937.

SECTION 9. SEVERABILITY. If any section, sentence, clause or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and adopted this Ordinance and each section, sentence, clause or phrase thereof, irrespective of the fact that one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional.

SECTION 10. CUSTODIAN OF RECORDS. The documents and materials that constitute the record of proceedings on which this Ordinance is based are located at the City Clerk’s office located at 4831 Broadway, Suite 201, American Canyon, CA 94503. The custodian of these records is the City Clerk.

The foregoing Ordinance was introduced at a regular meeting of the City Council of the City of American Canyon, State of California, held on the 19TH day of March, 2024 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

The foregoing Ordinance was adopted at a regular meeting of the City Council of the City of American Canyon, State of California, held on the _________ day of ____________, ______, by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
35 _____________________________
Leon Garcia, Mayor
ATTEST: APPROVED AS TO FORM:
_______________________________ ___________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 36 CITY COUNCIL AGENDA
APRIL 2, 2024

STAFF REPORT

CONSENT
ITEM NUMBER: 9.

TITLE
CalOES Designation

RECOMMENDATION
Adopt a Resolu"on designa"ng the Authorized Agents with California Governor's Office of Emergency Services (CalOES) for the purpose of obtaining federal and state financial assistance for emergencies.

CONTACT
Erica Ahmann Smithies, P.E., Public Works Director

BACKGROUND & ANALYSIS
This is an administra"ve item required by the Governor's Office of Emergency Services (CalOES), which will enable the City of American Canyon to obtain federal financial assistance for any exis"ng or future disaster/grant programs.

Ordinance 97-13 designates the City Manager as the Emergency Services Director and established in Chapter 2.48 of the City Municipal Code, Civil Defense and Disaster Relief. Chapter 2.48 includes the du"es of each designa"on. In order to be reimbursed, CalOES requires a resolu"on with specific wording and the iden"fica"on of alternates. The a?ached resolu"on is based on their format (CalOES form 130). The Resolution is effective for all currently open grants and for 3 years from date of approval and must be renewed every 3 years.

COUNCIL PRIORITY PROGRAMS AND PROJECTS
Organizational Effectiveness: "Deliver exemplary government services."

FISCAL IMPACT
There is no fiscal impact for this action.

ENVIRONMENTAL REVIEW
None
ATTACHMENTS:
37 1. Resolution - CalOES
38 DESIGNATION OF APPLICANT'S AGENT RESOLUTION FOR
- Federally declared Disaster (DR), Fire Mitigation Assistance Grant (FMAG), California State Only Disaster (CDAA), Immediate Services Program (ISP), Hazard Mitigation Grant Program (HMGP), Building Resilient Infrastructure and Communities (BRIC), Legislative Pre-Disaster Mitigation Program (LPDM), - - Flood Mitigation Assistance Program (FMA)
- National Earthquake Hazards Reduction Program (NEHRP) - California Early Earthquake Warning (CEEW)
Rev. 2022 OES- 39
Please check the appropriate box below

CERTIFICATION
Rev. 2022 OES- -
40 CITY COUNCIL AGENDA
APRIL 2, 2024

STAFF REPORT

PUBLIC HEARING
ITEM NUMBER: 10.

TITLE
Utility Rate Increases - Proposition 218 "Protest Hearing"

RECOMMENDATION
Take the following actions related to utility rates:

1. Open the Public Hearing, receive public comment, and then close the Public Hearing;

2. Determine whether a majority of property owners have submitted written protests;

3. Waive first reading and adopt by 9tle only an Ordinance amending City of American Canyon Municipal Code (ACMC) Chapter 13.06: "Water Rates and Connec9on Fees", Chapter 13.14 "Water Conserva9on Plan", and Chapter 14.04: "Wastewater Rates and Charges" to establish new potable water, recycled water and wastewater property related fees and charges.

CONTACT
Jason Holley, City Manager
Erica Ahmann Smithies, P.E., Public Works Director
Juan Gomez, Finance Director

BACKGROUND & ANALYSIS
American Canyon provides potable water, recycled water, and sewer services to proper9es in its "service area". The term "property related fee(s)" is more commonly known as "u9lity rate(s)" and describes the "fees and charges" assessed for those utility services.

Tonight's hearing represents the final step of a formal, mul9-step process for increasing u9lity rates (i.e. property related fees). Ar9cle XIII D of the California Cons9tu9on - as enumerated by the passage of Proposi9on 218 in 1996 - dictates this process, which includes "majority protest" proceedings involving property owners.

Specifically, the California Constitution requires:

Revenues generated by utility rates to not exceed the cost of the utility service.

A property owner's utility rate to not exceed their proportionate share of the costs.

Utility rates are charged only for services available to the property owner.

Holding a public hearing at least 45-days aFer no9fying property owners and prior to taking action to increase utility rates.
41 In addi9on, the Council is prohibited from taking ac9on to increase u9lity rates if a majority of property owners submit "written protests".

On January 16, 2024, the Council reviewed proposed u9lity rate increases, authorized propertyowner no9fica9ons and set a hearing date for tonight. Staff recommends increasing u9lity rates to cover opera9onal expenses and needed capital investments. The amounts of the increases were reviewed and confirmed by a volunteer group of local residents known as the U9lity Rate Advisory Committee and are discussed in more detail below.

Summary of Community Outreach since January 2024
The California Cons9tu9on requires at a minimum a wriHen no9fica9on of proposed increases to property owners. No9ces of proposed u9lity rates increase - including specifically the amounts of the increases - were mailed to all property owners more than 45 days ago (Attachment 3).

Staff has undertaken a robust public outreach centered around the City’s Virtual City Hall (www.cityofamcan.org/water). Property owner no9ces in English, Spanish, and Tagalog versions are available here along with a "rate study" containing the analysis which serves as the basis for rate structure. Customer resources – including Frequently Asked Ques9ons (FAQs), low-income customer op9ons, an online bill impact calculator, a printable protest leHer, visual infographics and cost comparisons are also found here.

A poster with the key messaging is posted in the lobby at City Hall, and other key public areas in the community. In addi9on, a large informa9onal postcard mailer was mailed to all residences and businesses. Lastly, staff included messaging in the City Manager's Update, social media plaNorms, and utility bill inserts.

Background
American Canyon’s u9lity infrastructure includes a vast network of pipes, tanks, pump sta9ons, fire hydrants, meters, treatment plants, and other facili9es. This infrastructure delivers safe and reliable drinking water, collects and treats wastewater, and recycles water for non-potable uses. Skilled labor, quality materials, and reliable equipment are necessary to operate and maintain the u9lity systems.

American Canyon provides three (3) dis9nct and separate u9lity services to proper9es within its service area: potable water, recycled water, and sewer (wastewater). Each of these services are operated separately from each other - and separately from other general services (such as public safety, parks and facilities, etc.).

The California Cons9tu9on requires these "enterprises" to operate independently - meaning 42 revenue from one cannot be used for the other. And while private investor-owned u9li9es such as PG&E make a profit on gas and electric services, American Canyon does not. Meaning any surplusage revenue at the end of a fiscal year is retained and re-invested in its respec9ve u9lity operation.

Staff proposes three (3) separate u9lity rates (water, recycled water and wastewater) - one for each enterprise. These rates are further proposed to be delineated between a fixed monthly amount (which does not change based on the volume - i.e. $/month) and a variable amount (based on volume, i.e. $/unit).

It is important to note one classes of ratepayers (e.g. "commercial") cannot be charged a a higher rate to reduce the rate of another (e.g. "residen9al"). Addi9onally, wealthy ratepayers cannot be charged a higher rate in order to subsidize a lower rate for those who might be unable to afford higher rates.

History and Current Challenges
American Canyon last updated water rates in 2019. Wastewater rates have not been updated since 2007. Uniform rates for recycled water were never formally adopted (but are proposed now).

While staff has increased u9lity rates administra9vely - based on the Consumer Price Index (CPI) - American Canyon con9nues to experience external cost pressures exceeding infla9on - and Council approval is now required to increase utility rates.

Example cost pressures include maintenance and construc9on costs, treatment costs, personnel costs, new regulatory costs, water supply challenges, aging infrastructure, water purchases from the Ci9es of Napa and Vallejo, as well as the State Water Project and specifically, par9cipa9on in the Sites Reservoir Project.

Also, there are no established recycled water rates, which is needed to cover opera9onal costs and service loans made to this fund for startup costs.

In summary, the current u9lity rates do not bring in sufficient revenue to cover the cost of providing reliable services. Since rates are the primary funding source the City must consider poten9al rate and charges increases for water service and wastewater service as well as establishing new rates and charges for recycled water service.

Analysis
The Council established a voluntary ci9zen U9lity Rate Advisory CommiHee on November 15, 2022.

Since then, the CommiHee has met several 9mes to understand the City’s the costs of providing utility service while collaborating with staff to prepare a recommendation for the Council. 43 Proposed u9lity rates were developed based on the City's costs to provide the service and considering future annual opera9ng costs and budgeted repair and replacement expenses by evaluating the prior year's audited financial data.

A "Cost of Service Analysis" was prepared by independent consul9ng firm (NBS) and contains a detailed descrip9on of the analysis which serves as the basis for the staff’s recommenda9on (AHachment 2, Exhibit A). The proposed u9lity rate increases will support a cost-of-service structure consistent with current law.

Latest Update since January 2024
In response to Council and public feedback, staff is revising its prior recommenda9on as shown below (in bold):

Potable Water - Fixed Charges
Same increases recommended in the property owner notice shown in Attachment 2.

Potable Water - Variable Rate
New Recommenda on: the Council takes no ac on. The quan9ty rate ($/unit) established in 2018 remains unchanged but the delineation between Tiers 1 and 2 is reduced from 10 units to 6 units.

Of note, staff will con9nue to administra9vely increase quan9ty rate up to 3% each (based on the Consumer Price Index) as currently allowed. As a result, the variable rate in Year 5 will grow up to a maximum of $8.74/unit (instead of $8.99/unit). Said differently, the quan9ty rate will increase by only 15.9% (over 5 years) instead of 19.2%.

Staff believes the addi9onal customers at Watson Ranch (and elsewhere) will broaden the base of customers. And when you broaden the base of customers with a rela9vely smaller quan9ty rate will generate the required revenue to support the operations.

Recycled Water - Fixed Charges
Same increases as recommended in the property owner notice shown in Attachment 2.

Recycled Water - Variable Rate
New Recommenda on: the Council takes ac on for a lower volumetric rate. The property owner no9ce listed a proposed volumetric rate of $6.69/unit for delivery and $4.00/unit for self-haul. The revised recommenda9on is a lower volumetric rate of $3.14/unit for delivery and $1.88/unit for selfhaul respectively.

Staff forecasts increased revenue based on the City’s Urban Water Management Plan – which iden9fies an expanded customer base to generate the required revenue to support the opera9ons. 44 The addi9onal customers are the result of soon to be completed pipeline and service extensions leading to more customers than previously considered.

Sewer – Residential and Commercial Customer Class
Same increases as recommended in the property owner notice shown in Attachment 2.

Sewer – Non-Residential High-Strength Customer Class
New Recommenda on: the Council takes no ac on. The City has three (3) non-residen9al, highstrength customers (known as “significant industrial users” or SIU). To protect the Water Reclama9on Facility (WRF) from high-strength waste, each SIU has a specific sewer service agreement and NPDES discharge permit. Currently each SIU "pre-treats" its wastewater before discharging to the collec9on system. The SIU metered, monitored, and tests the wastewater for a variety of constituents.

At Council’s direc9on as part of an economic development strategy for expanding business opportuni9es in the Green Island Industrial Area, staff is currently exploring op9ons for a new capital project at the WRF that will embrace (rather than reject) an SIU’s discharge of high-strength waste. The revenue to pay for this improvement will be generated by the current SIUs (and hopefully other SIUs) in conjunc9on with a future rate study, but for now, the current wastewater rate for SIU’s will generate adequate revenue over the next 18 to 24 months.

Regional Comparison
Below is comparison of staff recommenda9on to other agencies. The table assumes residen9al use of 7 units per month.

Utility Rates - Regional Comparison
City/Agency
Potable
Water
Fixed
Potable
Water
Quantity
Wastewater
Fixed
Wastewater
Quantity
Total
Monthly
Bill
Petaluma $26.02 $34.99 $39.85 N/a $94.87
Napa* $26.02 $28.59 $61.55 N/a $116.16
Yountville $93.76 $22.49 $65.42 N/a $116.25
Benicia $26.59 $38.78 $58.07 $23.80 $123.44
American Canyon
(Current)
$26.56 $52.78 $60.48 N/a $139.82
Vallejo* $51.72 $33.32 $73.74 N/a $158.78
American Canyon
(Proposed)
$31.32 $54.99 $74.94 N/a $161.25
Calistoga $62.82 $94.22 $106.24 N/a $263.28
St. Helena $67.75 $41.93 $89.63 $69.23 $268.54
*Note: wastewater service provided by separate special district 45 Implementation Process
AFer a brief presenta9on, staff recommends opening the Public Hearing, receiving public comment, and then closing the Public Hearing. Note, public tes9mony does not subs9tute for wriHen protest if the property owner opposes to the increases.

Once all public tes9mony is received and the Public Hearing is closed, all wriHen protests received to that point by the City Clerk will be evaluated to determine if a majority of property owners have submiHed wriHen protests. If the number is close, then staff will need to adjourn to review the protests to determine the number of valid votes. Two protests from the same property, one from the property owner and one from the ratepayer/tenant, is counted as one protest.

If a majority of wriHen protests is not received, then staff recommends adop9ng the Ordinance (AHachment 1) approving increased u9lity rates. If adopted, the new rates would become effec9ve January 1, 2025. Scheduled inflation increases will also occur in January each year.

COUNCIL PRIORITY PROGRAMS AND PROJECTS
Infrastructure: "Develop and maintain infrastructure resources to support sustainable growth."

FISCAL IMPACT
The fiscal impact related this item will result in increased opera9onal revenues for all three Enterprise Funds to offset projected increases associated with opera9ng these enterprises. The aHached Rate Study Report (AHachment 1, Exhibit A) provides greater detail on projected revenues and expenses.

The goal of the rate study is to provide adequate funding for opera9onal expenses and necessary long-term capital program needs. As Enterprise Funds, the Water, Sewer and Recycled Water Funds should be self-sustaining, this item achieves the goal of long-term fiscal and opera9onal sustainability for the Water and Sewer Enterprises. The Recycled Water Enterprise is a rela9vely new system with significant capital investments made in the last couple of years and these projected increases to the rates would move us closer to achieving a healthy, self-sustaining enterprise.

ENVIRONMENTAL REVIEW
The recommunicated u9lity rate increases are, among other things, for the purpose of con9nuing to provide funds to meet the costs of opera9ng, maintaining and replacing the u9lity facili9es within the service area and to provide funding for capital projects necessary and/or required to maintain service within the exis9ng service area and as such are Categorically Exempt from environmental review (Division 13, Section 21080 (b) (8)) under CEQA. 46 ATTACHMENTS:

1. Ordinance

2. Exhibit A (Rate Study, March 2024)

3. Notice
47 ORDINANCE NO. 2024-

ORDINANCE OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON AMENDING CITY OF AMERICAN CANYON MUNICIPAL CODE CHAPTER 13.06: "WATER RATES AND CONNECTION FEES", CHAPTER 13.14 "WATER CONSERVATION PLAN", AND CHAPTER 14.04: "WASTEWATER RATES AND CHARGES" TO ESTABLISH NEW POTABLE WATER, RECYCLED WATER AND

WASTEWATER PROPERTY RELATED FEES AND CHARGES
WHEREAS, the City of American Canyon’s utility infrastructure includes a network of treatment plants, pipes, tanks, pump stations, fire hydrants, meters, and other facilities; and WHEREAS, through this valuable infrastructure, the City provides safe and reliable drinking water, collects and treats wastewater, and produces recycled water for reuse, advancing sustainability efforts; and
WHEREAS, skilled labor, quality materials, and reliable equipment are necessary to operate and maintain the utility systems and facilitate water purchases from the Cities of Napa and Vallejo, as well as the State Water Project; and
WHEREAS, the City’s current utility rates and charges, comprised of Water, Wastewater, and Recycled Water Enterprise Funds, do not bring in sufficient revenue to cover operating and capital costs; and
WHEREAS, utility rates and charges have not increased for water since 2018, wastewater since 2009, and there are no established recycled water rates and charges; and WHEREAS, a Utility Rate Study was prepared by an independent consulting firm, NBS, and contains a detailed description and analysis of the proposed utility rates and charges per the respective enterprise fund; and
WHEREAS, the City and the Utility Rate Advisory Committee (URAC) have conducted a detailed fiscal analysis of the utility rates and developed recommendations regarding adjustments to the utility rates and charges in order to comply with state law; and WHEREAS, these rate and charge adjustments will help ensure the health and safety of the community while protecting the City’s financial health; and WHEREAS, Article XIIID, Section 6 of the California Constitution requires that prior to the public hearing to increase utility rates charged by the City, the City mail to each property owner or utility billing customer, at least 45 days prior to such public hearing, a notice describing (a) the amount of the fee or charge to be imposed upon each parcel, (b) the basis upon which the amount of the proposed fee or charge was calculated, (c) the reason for the fee or charge, and (d) the date, time, and location of a public hearing on the proposed fee or charge; and 48 WHEREAS, on February 16, 2024 the City mailed the notice of public hearing to be held on April 2, 2024, relating to the City’s proposed utility rates and charges in accordance with California Constitution Article XIIID Section 6; and
WHEREAS, the City held such public hearing on April 2, 2024, and received and considered all oral and written protests related to the proposed adjustments in the utility rates and charges; and
WHEREAS, the City Council of the City of American Canyon determined that written protests have not been received from property owners or utility billing customers representing a majority of the parcels subject to the proposed fee increase; and
WHEREAS, the City Council intends to adopt new utility rates and charges as shown in Exhibit A, attached hereto and made a part thereof, following the procedures required by Proposition 218, article XII D, section 6 of the California Constitution; and WHEREAS, the City Council intends to adopt a utility rate structure proposed by the analysis following the procedures required by Proposition 218, article XIII D, section 6 of the California Constitution; and
NOW THEREFORE BE IT ORDAINED that the City Council of the City of American Canyon, having considered all the evidence, including any submitted by member of the public, hereby adopts Municipal Code amendments as follows:

SECTION 1: Repeal and replace ACMC 13.06.030.B with the following:
(B) As of the effective date of the ordinance, or January 1, 2025, whichever comes later, the water meter charges for all customers shall be levied according to the following schedule:
01/01/25 01/01/26 01/010/27 01/01/28 01/01/29
< 1" meter $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $178.29 $194.33 $211.82 $220.30 $226.91
4" meter $276.27 $301.13 $328.23 $341.36 $351.60
6" meter $548.43 $597.79 $651.59 $677.66 $697.99
8" meter $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65
SECTION 2: Repeal ACMC 13.06.030.C.

SECTION 3: Repeal and replace ACMC 13.06.040.B with the following:
49 (B) As of the effective date of the ordinance, or January 1, 2019, whichever comes later, customers will pay quantity rates according to the following schedule below:

Residential Use 01/01/19 01/01/20 01/01/21 01/01/22 01/01/23 Tier 1 (0 - 6 units) $6.07 $6.42 $6.78 $7.15 $7.54
Tier 2 (> 6 units) $6.50 $7.01 $7.38 $7.76 $8.15
Non-Residential Use 01/01/19 01/01/20 01/01/21 01/01/22 01/01/23 $6.24 $6.59 $6.96 $7.33 $7.72
Raw Water 01/01/19 01/01/20 01/01/21 01/01/22 01/01/23
$3.06 $3.15 $3.24 $3.34 $3.44
Effective January 1, 2024, and on every January 1st thereafter, quantity charges will be adjusted by the percent change in the Bay Area Consumer Price Index over the previous calendar year, or by three percent, whichever is less.

SECTION 4: Repeal and replace ACMC 13.14.100 with the following:

13.14.100 – Drought Surcharge
(A) Customers will receive prior notification of the standard allotment basis, applicable rates, and the opportunity to request exceptions to the standard allotment basis. (B) Water use beyond the maximum allowed for each water conservation stage shall be subject to a drought surcharge pursuant to the schedule set forth below. The customer of record may request an increase in this basic allotment as set forth in Section 13.14.110 hereof. Application forms and instructions will be available at the American Canyon City Hall.
(C) In addition to the quantity rates set forth in ACMC 13.06.040.B, each customer shall pay, during each billing period, a drought surcharge for water delivered in excess of the basic allotment as follows:
01/01/25 01/01/26 01/01/27 01/01/28 01/01/29
Stage 1 $0.35 $0.44 $0.53 $0.58 $0.62
Stage 2 $0.79 $0.98 $1.19 $1.30 $1.39
Stage 3 $1.36 $1.68 $2.03 $2.23 $2.39
Stage 4 $2.12 $2.61 $3.16 $3.46 $3.71
Stage 5 $3.17 $3.92 $4.75 $5.20 $5.57
Stage 6 $4.76 $5.88 $7.12 $7.79 $8.36
50 Customers whose water usage falls in Tier 1 as set forth in in ACMC 13.06.040.B are assumed to have maximized their conservation effort and will not be subject to a drought surcharge if their water consumption is not further reduced.

In addition to the drought surcharge, if drought usage exceeds the allowed allotment, a warning will be issued and enforcement actions may be taken as described in Section

13.14.120.

SECTION 5: Modify ACMC 13.14.065 as follows:

Following a public hearing, the city's nonresidential recycled water customers whose properties may be served by recycled water shall connect their property to recycled water for those uses for which the use of potable domestic water would be deemed a waste or unreasonable use of water as specified in Division 7, Chapter 7, of the California Water Code (Section 13550 et seq.). Recycled water customers shall pay for recycled water at the rate established by the city council.

As of the effective date of the ordinance, or January 1, 2025, whichever comes later, recycled water customers shall pay the meter charges and quantity rates for recycled water service as set forth below:

Water Meter Charges
01/01/25 01/01/26 01/010/27 01/01/28 01/01/29
< 1" meter $38.89 $42.78 $47.05 $49.41 $51.88
1" meter $64.81 $71.29 $78.42 $82.34 $86.46
1 1/2" meter $129.62 $142.58 $156.84 $164.69 $172.92
2" meter $207.40 $228.14 $250.95 $263.50 $276.67
3" meter $414.79 $456.27 $501.90 $526.99 $553.34
4" meter $648.11 $712.92 $784.22 $823.43 $864.60
6" meter $1,296.23 $1,425.85 $1,568.43 $1,646.85 $1,729.20 8" meter $2,073.96 $2,281.36 $2,509.49 $2,634.97 $2,766.71 Quantity Rates ($/hcf)
01/01/25 01/01/26 01/010/27 01/01/28 01/01/29
Delivered $3.14 $3.46 $3.80 $3.99 $4.19
Self-Haul $1.88 $2.07 $2.28 $2.39 $2.51
Effective January 1, 2030, and on every January 1st thereafter, wastewater service charges will be adjusted by the percent change in the Bay Area Consumer Price Index over the previous calendar year, or by three percent, whichever is less. 51 SECTION 6: Repeal and replace ACMC 14.04.020 as follows:

14.04.020 Wastewater service charges – Residential service (A) As of the effective date of the ordinance, or January 1, 2025, whichever comes later, each residential customer shall pay for wastewater services per dwelling unit per month according to the schedule outlined below:
01/01/25 01/01/26 01/010/27 01/01/28 01/01/29
Single Family Residential $74.94 $89.93 $100.72 $112.81 $112.81 Multi-Family Residential $48.70 $58.44 $65.45 $73.31 $73.31 (B) Effective January 1, 2030, and on every January 1st thereafter, wastewater service charges will be adjusted by the percent change in the Bay Area Consumer Price Index over the previous calendar year, or by three percent, whichever is less.

SECTION 6: Repeal and replace ACMC 14.04.030 as follows:

14.04.030 Wastewater service charge—Mobile home residential service. (A) Each mobile home customer with an individual metered account shall be considered a Multi-Family Residential Customer and pay for wastewater services according to the schedule set forth in ACMC 14.040.020.

SECTION 7: Repeal and replace ACMC 14.04.040 as follows:

14.04.040 Wastewater service charge—Multifamily.
(A) Each multi-family residential customer shall pay for wastewater services according to the schedule set forth in ACMC 14.040.020.

SECTION 8: Repeal and replace ACMC 14.04.050 as follows

14.04.050 Wastewater service charges—Nonresidential, normal strength. (A) As of the effective date of the ordinance, or January 1, 2025, whichever comes later, each normal strength, nonresidential customer shall pay both a monthly service charge and a volumetric charge for wastewater services according to the schedule outlined below:
01/01/25 01/01/26 01/010/27 01/01/28 01/01/29
Monthly Service Charge $115.21 $138.25 $154.84 $173.42 $173.42 Volumetric Rate ($/HCF) $1.92 $2.31 $2.58 $2.89 $2.89
52 The volumetric charge shall be equal to the volumetric rate established by schedule above ($/HCF) multiplied by the quantity of water delivered to the customer pursuant to ACMC 13.04.
(B) Effective January 1, 2030, and on every January 1st thereafter, wastewater service charges will be adjusted by the percent change in the Bay Area Consumer Price Index over the previous calendar year, or by three percent, whichever is less.

NOW THEREFORE BE IT FURTHER ORDAINED that the American Canyon City Council does hereby resolve as that based on these facts and circumstances presented and the information received during the public hearing, the City Council finds that adjustments to the utility rates and charges, as shown in Exhibit A, are necessary and hereby adopted.

PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 2nd day of April, 2024, by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
____________________________
Leon Garcia, Mayor
ATTEST: APPROVED AS TO FORM:
_______________________________
_________________________________
Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 53 nbsgov.com
Report for:

Sewer, Water, and Recycled Water Enterprise Rate
Studies
March 2024

54 TABLE OF CONTENTS

1. Purpose and Overview of the Study ................................................................................1

1.1 Purpose......................................................................................................................1

1.2 The City of American Canyon Background................................................................1

1.3 Overview of the Study...............................................................................................2

2. Water Rate Study ...........................................................................................................7

2.1 Key Water Rate Study Issues.....................................................................................7

2.2 Financial Plan.............................................................................................................7

2.3 Cost-of-Service Analysis ............................................................................................9

2.4 Characteristics of Water Customers by Customer Class.........................................11

2.5 Rate Design Analysis................................................................................................13

2.6 Proposed Water Rates ............................................................................................18

2.7 Comparison of Current and Proposed Water Bills..................................................20

2.8 Drought Rates..........................................................................................................21

3. Recycled Water Rate Study ........................................................................................... 23

3.1 Key Recycled Water Rate Study Issues....................................................................23

3.2 Recycled Water Utility Revenue Requirements......................................................23

3.3 Proposed Recycled Water Rates.............................................................................24

3.4 Current vs. Proposed Recycled Water Rates...........................................................24

4. Sewer Rate Study ......................................................................................................... 26

4.1 Key Sewer Rate Study Issues...................................................................................26

4.2 Financial Plan...........................................................................................................26

4.3 Cost-of-Service Analysis ..........................................................................................27

4.4 Rate Design Analysis................................................................................................30 55 4.5 Comparison of Current and Proposed Sewer Bills..................................................31

5. Recommendations and Next Steps................................................................................ 33

5.1 Consultant Recommendations................................................................................33

5.2 Next Steps................................................................................................................33

5.3 NBS’ Principal Assumptions and Considerations ....................................................33 Technical Appendices .......................................................................................................... 34 Appendix A. Water Rate Study Tables and Figures................................................................ 35 Appendix B. Recycled Water Rate Study Tables and Figures ................................................. 81 Appendix C. Sewer Rate Study Tables and Figures.............................................................. 102 56 TABLE OF FIGURES
Figure 1. Primary Components of a Rate Study ................................................................................................. 3 Figure 2. Summary of Water Revenue Requirements........................................................................................ 9 Figure 3. Summary of Primary Water Reserve Funds......................................................................................... 9 Figure 4. Allocation Percentages of Revenue Requirements........................................................................... 11 Figure 5. Allocated Net Revenue Requirements .............................................................................................. 11 Figure 6. Water Consumption by Customer Class............................................................................................ 12 Figure 7. Capacity Factors by Customer Class ……………………………………………………………………………………………..12 Figure 8. Number of Meters by Customer Class............................................................................................... 13 Figure 9. Hydraulic Capacity Factors ................................................................................................................ 14 Figure 10. Equivalent Meters .......................................................................................................................... 14 Figure 11. Calculation of Fixed Service Charges (Residential) ......................................................................... 15 Figure 12. Summary of Supply Sources Allocated to Tiers............................................................................... 15 Figure 13. Allocated Consumption from Each Source of Supply ...................................................................... 16 Figure 14. Tier Breakpoints for Residential Customers.................................................................................... 16 Figure 15. Tiered Rates for FY 2023/24 ............................................................................................................ 16 Figure 16. Uniform Tier Rates for FY 2023/24.................................................................................................. 17 Figure 17. Variable Revenue Comparison ........................................................................................................ 18 Figure 18. Current and Proposed Water Rates - Fixed Charges ...................................................................... 19 Figure 19. Current and Proposed Water Rates - Variable Rates (COSA) ......................................................... 20 Figure 20. Current and Proposed Water Rates - Variable Rates (Alternative 2) ............................................. 20 Figure 21. Monthly Water Bill Comparison for Residential Customers............................................................ 20 Figure 22. Monthly Water Bill Comparison for Commercial Customers.......................................................... 21 Figure 23. Expenses Directly Impacted by Conservation ................................................................................. 21 Figure 24. Projected Consumption at Baseline and Each Successive Drought Stage ...................................... 22 Figure 25. Proposed Drought Surcharges ........................................................................................................ 22 Figure 26. Summary of Recycled Water Revenue Requirements..................................................................... 23 Figure 27. Summary of Recycled Water Revenue Requirements for FY 2023/24 ........................................... 24 Figure 28. Recycled Water Fixed Rate Calculation .......................................................................................... 24 Figure 29. Recycled Water Variable Rate Calculation ..................................................................................... 24 Figure 30. Current and Proposed Recycled Water Rates ................................................................................ 25 Figure 31. Summary of Wastewater Revenue Requirements.......................................................................... 27 Figure 32. Summary of Sewer Reserve Funds.................................................................................................. 27 Figure 33. Allocation of Revenue Requirements by Customer Class ............................................................... 28 Figure 34. Development of the Flow Allocation Factor ................................................................................... 29 Figure 35. Development of the Customer Allocation Factor ........................................................................... 29 Figure 36. Current vs. Proposed Sewer Rates .................................................................................................. 31 Figure 37. Single Family Sewer Bill Comparison............................................................................................... 31 Figure 38. Multi-Family Residential Sewer Bill Comparison............................................................................. 32 Figure 39. Commercial Sewer Bill Comparison................................................................................................. 32 57 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 1

1. Purpose and Overview of the Study

1.1 Purpose
The City of American Canyon (City) retained NBS to conduct a comprehensive rate study for its water, recycled water, and sewer enterprise funds. The City had a number of objectives and goals in mind for this study including meeting revenue requirements, reviewing current rate structures based on recent consumption data, funding capital improvements and changes in costs, and complying with certain legal requirements (e.g., California Constitution Article XIII D, Section 6, which is commonly referred to as Proposition 218 [Prop 218]). The City’s broader objectives in this study include ensuring adequate funding for operating and capital costs, maintaining reasonable reserves, ensuring revenue stability in utility rates, and developing new recycled water and drought rates to reflect the revenue requirements at various stages of water conservation. The rates resulting from this study were developed in a manner that is consistent with industry standard cost-of-service principles. In addition to documenting the rate study methodology, this report is provided with the intent to assist the City in its continuing effort to maintain transparent communications with the residents and community it serves.

In developing new rates for the City’s enterprise funds, NBS worked cooperatively with City staff and the City Council (Council) in selecting the appropriate rate alternatives that address the City’s goals and objectives. Based on input provided by City staff, NBS proposes the rates summarized in this report. The Council has the final decision regarding the adoption of the proposed rates and whether to proceed with the Proposition 218 approval process.

1.2 The City of American Canyon Background
The City of American Canyon was incorporated in 1992 and is located in southern Napa County about thirtyfive miles northeast of San Francisco.

WATER UTILITY
The City provides potable water service to approximately 6,825 metered customers. Of these potable water customers, residential customers represent approximately 90%, including single-family and multi-family users. Recent consumption records indicate that residential households use 59% of total water sold compared to all other non-residential customers who use the remaining 41%. The City’s existing potable water system includes treatment, storage, pumping, and distribution infrastructure serving residential, industrial, commercial, and agricultural customers.1
The City relies on several sources of water to meet its needs including water from the State Water Project, water from the cities of Vallejo and Napa, and recycled water produced at the City’s Water Reclamation Facility (WRF). The primary source of water is from the State Water Project (61%) via the North Bay Aqueduct, while the remaining supply consists of treated water from the cities of Vallejo and Napa as well as raw water from the City of Vallejo. The City has also partnered with the Sites Reservoir Project in 2017 to construct an off-river reservoir that will capture excess water from major storms that can be utilized during drier periods. This project is in the final stages of environmental review. 1 Source: https://www.cityofamericancanyon.org/ home/showpublisheddocument/17957. 58 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 2

RECYCLED WATER UTILITY
The City owns and operates a complementary water and wastewater utility infrastructure that includes water reclamation and water reuse within the City limits. The current area served with recycled water is approximately 5 square miles with an overall potential service area of over 14 square miles, including potential customers within Napa County just outside City limits along the northern boundary.2 The City currently serves public schools, public parks, industrial, commercial, and agricultural users, and produces approximately 80 million gallons of recycled water each year primarily for outdoor use. The City provides recycled water service to 76 customers.

Using recycled water for irrigation saves electricity, using one quarter of the energy needed to pump groundwater, and dramatically reduces the consumption of potable water. The additional treatment of wastewater at the reclamation plant also reduces nitrates which could otherwise impact the groundwater basin. As with reclaimed water providers throughout California, the City’s recycled water rates tries to be competitive with other sources of irrigation water while ideally recovering basic operating costs.

SEWER UTILITY
The City currently provides sewer service to customers located within the City limits, as well as the Airport Industrial Area and a few areas within the unincorporated County area. The City completed construction of the Water Reclamation Facility (WRF) in 2002 to treats domestic and industrial wastewater flows.

Currently, the sewer utility services approximately 6,100 connections; the vast majority (77%) of which are single-family residential users. The remainder of the customers are primarily multi-family residential users (21%) and a handful of commercial and industrial users (3%). The current area served is approximately 6.3 square miles with an overall potential service area of over 8.5 square miles and includes approximately 53 miles of sewer mains, five pump stations, and 5 miles of sewer force main.3

1.3 Overview of the Study
Comprehensive rate studies, such as this one, typically include three components: (1) preparation of a financial plan that identifies the net revenue requirements for the utility; (2) analysis of the cost to serve each customer class; and (3) the rate structure design. These steps are shown in Figure 1 and are intended to follow industry standards. They reflect the fundamental principles of cost-of-service rate making embodied in the American Water Works Association’s (AWWA) Principles of Water Rates, Fees, and Charges,
4 also referred to as Manual M1 for water rates and the Water Environment Federation’s (WEF) Financing and Charges for Wastewater Systems, Manual of Practice No. 275for sewer rates. They also address requirements under Proposition 218 that rates do not exceed the cost of providing the service and be proportionate to the cost of providing service for all customers. In terms of the chronology of the study, these three steps represent the order in which they were performed in this Study.
2 Source: https://www.cityofamericancanyon.org/home/showpublisheddocument/9735. 3 Source: https://www.cityofamericancanyon.org/home/showpublisheddocument/9733. 4 Principles of Water Rates, Fees, and Charges, Manual of Water Supply Practices, Manual M1, American Water Works Association, 7
th Edition, 2017.
5 Financing and Charges for Wastewater Systems, Manual of Practice No. 27, Water Environment Federation, 4th Edition, 2018. 59 Enterprise Rate Study – City of American Canyon
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Figure 1. Primary Components of a Rate Study
NBS projected revenues and expenditures, developed net revenue requirements, performed cost-of-service rate analyses, and developed new water, recycled water, and sewer rates for the City using this approach.

The following sections in this report present an overview of the methodologies, assumptions, and data used along with the financial plans and rates developed. Detailed tables and figures documenting the development of the proposed rates are provided in the Appendices.

The City provided NBS with the data necessary to conduct the study, including historical, current, and projected revenues and expenditures, number of customer accounts, and water consumption data along with other operational and capital cost information.

FINANCIAL PLAN
As a part of the rate study, NBS projected revenues and expenditures on a cash-flow basis for the next five (5) years. The amount of rate revenue required that will allow reserves to be maintained at the recommended levels is known as the net revenue requirement. As current rate revenue falls short of the net revenue requirement, rate adjustments - or more accurately, adjustments in the total revenue collected from rates - are recommended. This report presents an overview of the methodologies, assumptions, and data used along with the financial plan and proposed rates developed in this study.6

COST-OF-SERVICE ANALYSIS
The basic purpose of the cost-of-service analysis (COSA) is to fairly and equitably allocate costs to customer classes. The cost-of-service analysis consists of two major components: (1) the classification of expenses, and (2) the allocation of costs to customer classes. For example, a key task is the “classification” of the water revenue requirements into the following categories:
• Commodity related costs
• Recycled water related costs
• Capacity related costs
• Customer service related costs
• Fire Protection related costs
6 The complete financial plans are available in the Appendices. 60 Enterprise Rate Study – City of American Canyon
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In addition, here are the categories used in the “classification” of the sewer revenue requirements :
• Flow related costs
• Strength related costs
• Customer service related costs
These cost allocation factors represent the types of cost allocations in the cost of service. Further details are discussed below and documented in the Appendices.

RATE DESIGN ANALYSIS
During the rate design phase of the study, NBS and City staff worked together to develop rate alternatives to meet the City’s objectives. It is important for the City to send proper price signals to its customers about the actual cost of providing service. This objective is typically addressed through both the magnitude of the rate adjustments and the rate structure design. In other words, both the amount of revenue collected and the way in which the revenue is collected from customers are important.

Several criteria are typically considered in setting rates and developing sound rate structures. The fundamentals of this process have been well documented in a number of rate-setting manuals, such as AWWA’s Manual M1. The foundation for evaluating rate structures is generally credited to James C.

Bonbright in Principles of Public Utility Rates,
7 which outlines pricing policies, theories, and economic concepts along with various rate designs. The following is a simplified list of the attributes of a sound rate structure:
• Rates should be easy to understand from the customer’s perspective. • Rates should be easy to administer from the utility’s perspective. • Rates should promote the efficient allocation of the resource. • Rates should be equitable and non-discriminating (i.e., cost based). • There should be continuity in the rate making philosophy over time. • Addressing other utility policies (e.g., conservation and economic development). • Rates should provide month-to-month and year-to-year revenue stability.

RATE STRUCTURE TERMINOLOGY
This section covers basic rate design criteria that NBS and City staff considered as a part of their review of the rate structure alternatives. One of the most fundamental points in considering rate structures is the relationship between fixed and variable costs. Fixed costs, such as debt service and personnel costs, typically do not vary with the amount of water consumed. In contrast, variable costs, such as the cost of purchased water, chemicals, and electricity, tend to change with the quantity of water sold. The vast majority of rate structures contain a fixed, or minimum, charge in combination with a volumetric charge. • Fixed Charges – Fixed charges can be called base charges, minimum monthly charges, customer charges, fixed meter charges, etc. Fixed charges for water utilities typically increase by meter 7 James C. Bonbright, Albert L. Danielsen, and David R. Kamerschen, Principles of Public Utility Rates, Arlington, VA: Public Utilities Report, Inc., Second Edition, 1988, pp. 383-384.
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size. For example, a customer with a 2-inch meter has a fixed meter charge that is more than five times greater than the typical residential customer based on the safe operating capacity of the meter.
8 Since a large portion of utility costs are typically related to meeting capacity requirements, individual capacity demands are important in establishing equitable rates for customers.
• Variable (Consumption-Based) Charges – In contrast to fixed charges, variable costs, such as purchased water, groundwater replenishment costs, and the cost of electricity used in pumping water and chemicals for treatment, tend to change with the quantity of water produced. For a water utility, variable charges are calculated based on a metered consumption per unit price (e.g., per 100 cubic feet, or HCF).
• Uniform (Single-Tier) Water Rates – There are significant variations in the basic philosophy of variable charge rate structure alternatives. Under a uniform (single tier) rate structure, the cost per unit does not change with consumption and, therefore, provides a simple and straightforward approach from the customer’s perspective and in terms of the City’s rate administration.
• Tiered Water Charges – In contrast to a uniform tier, a tiered (or inclining block) rate structure attempts to send a price signal to customers that the cost of water increases as more water is consumed and is considered to be a more conservation-oriented rate structure. Tiered water rates are encouraged by state law and regulatory mandates but are also intended to represent the higher costs for customers who contribute more to peak usage and place greater demands on the system. The types of higher costs reflected in the higher tiers may include:
• Conservation Program Costs - These are costs intended to encourage customers to eliminate inefficient and wasteful water use, and otherwise reduce consumption during peak periods.
• Purchased Water Costs - When consumption exceeds the amount of water rights the City is allocated, the City may incur additional costs for replacement water in order to meet that increased demand. That replacement water comes at a higher cost. • Energy Costs - During summer months, the City may pay more in electric charges to pump, treat, and deliver water, and have a higher percentage of its energy bill in higher electricity “tiers.”
• Higher Maintenance Costs - Peak periods tend to have a higher number of service calls, capacity costs, and system maintenance issues when the water system is running at peak demand.

REGULATORY ISSUES
Drought and Water Conservation – On January 17, 2014, Governor Jerry Brown declared a State of Emergency throughout California due to severe drought conditions. On April 1, 2015, the Governor issued Executive Order B-29-15 mandating statewide water conservation of 25 percent. The specific conservation mandate for each community in California varied from 4 to 36 percent. Beginning in June 2016, 8 Principles of Water Rates, Fees, and Charges, Manual of Water Supply Practices, Manual M1, AWWA, 7th Edition, 2017, pp. 151- 152.
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communities like the City were allowed to “self-certify” that they had sufficient supply to meet customer demand for three years but were no longer mandated to achieve a specific conservation target.

While conservation is good from a supply and environmental standpoint, it places added financial pressure on the water utility. Consumption impacts both revenue and expenses and, with positive conservation efforts continuing to be a priority for the City, revenue declines could put the water utility at risk in the future without changes in the consumption charges. To help offset these risks, the drought rates proposed in this study account for various stages of water conservation to allow the City to continue meeting its financial obligations going forward. The drought rates would be intended to go into effect whenever the City declares it is in a specific stage of its adopted drought mitigation plan.

KEY FINANCIAL ASSUMPTIONS
The following is a summary of the key financial assumptions used in the analyses. The following capital and operational fund targets reflect input from City staff in order to meet specific utility objectives:
• Funding of Capital Projects – The capital improvement costs will be funded with a combination of cash in reserves and the additional revenue generated from the proposed rate increases.

The capital projects listed in the financial plan are from the City’s capital improvement plan.

The analysis assumes:
• Capital costs attributable to existing customers are funded by rate revenue. • Capital costs attributable to growth are funded through revenue from the capacity fee reserves.
• Reserve Targets – For each utility (i.e., water, recycled water, and sewer), the City maintains reserves for operations, capital, and other specific needs. The details of each utility’s reserve targets are covered in their respective section of this report. • Inflation and Growth Projections – Assumptions were made in the analysis with regard to cost inflation in order to project future revenues and expenses for the study period. The following inflation factors were used in the analysis:
• Customer growth is estimated at 1.80% per year.
• General cost inflation is set at 3.0% annually.
• Labor cost inflation is set at 3.5% annually.
• Energy cost inflation is set at 7.44% annually.
• Electricity cost inflation is set at 5.64% annually.
• Fuel & Utilities cost inflation is set at 5.24% annually. • Construction cost inflation is set at 3.5% annually.

These inflation factors are based on long-term trends; therefore, the City should re-examine these factors in another year to assess whether short-term trends are a better reflection of the costs going forward. 63 Enterprise Rate Study – City of American Canyon
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2. Water Rate Study

2.1 Key Water Rate Study Issues
The City’s water rate analysis was undertaken with a few specific objectives, including:
• Generating sufficient revenue to meet anticipated operating and maintenance costs and fund necessary capital improvement projects for the next five years. • Continuing with a rate design that promotes revenue stability. • Developing drought rates.
• Verifying that the City’s tiered volumetric rates are cost of service based. • Encouraging water conservation with a tiered rate structure. • Maintaining adequate reserve levels to ensure continuity in operations. • Complying with the legal requirements of Proposition 218 to ensure the cost of providing service is properly allocated amongst user classifications.

NBS developed various water rate alternatives as requested by City staff over the course of this study. All rate structure alternatives relied on industry standards and cost-of-service principles. The fixed charges and volume-based rates were calculated based on the net revenue requirements, number of customer accounts, water consumption and estimated water discharge, and other relevant data provided by the City.

The following are the basic components included in this analysis:
• Developing Cost Allocations – The water revenue requirements were “functionalized” into five categories: (1) commodity (or volume-based) costs; (2) recycled water costs; (3) fixed capacity costs; (4) customer service costs; and (5) fire protection costs. These functionalized costs were then used to develop unit costs based on various factors, such as water consumption, peaking factors, and number of accounts by meter size.
• Determining Revenue Requirements by Customer Class – The total revenue that needs to be collected from each customer class was determined using the functional costs and allocation factors. For example, customer costs are allocated based on the number of meters, while volume-related costs are allocated based on the water consumption of each customer class.

Once the costs are allocated and the net revenue requirement for each customer class is determined, collecting the revenue requirements from each customer class is addressed within the rate design.
• Evaluating Rate Design (Fixed vs. Variable Charges) – The revenue requirements for each customer class are collected through a combination of fixed monthly service charges and volumetric rates.

2.2 Financial Plan
It is important for municipal utilities to not only collect sufficient revenues every year, but to also maintain reasonable reserves to handle emergencies, fund working capital, maintain a good credit rating, and generally follow sound financial management practices. Rate adjustments are governed by the need to meet operating and capital costs as well as maintain reasonable reserve funds. The current state of the City’s water utility, with regard to these objectives, is as follows:
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• Meeting Net Revenue Requirements: For FY 2023/24 through FY 2027/28, the projected net revenue requirement (that is, total annual expenses plus debt service and rate-funded capital costs, less non-rate revenues) for the water system is approximately $13.4 million per year. The net revenue requirement includes interfund transfers for debt service and capital projects totaling $4.0 million annually and are expected to continue over the next five years. As a result, the water utility is financially sound and requires only minimal rate adjustments over the 5-year rate adoption period. However, it is important to note that the utility would be facing a deficit that would grow to $3.8 million by the end of this period if these contributions were to cease. • Building and Maintaining Reserve Funds: Reserve funds provide a basis for a utility to cope with fiscal emergencies, such as revenue shortfalls, asset failure, and natural disasters, among other events. Reserve policies provide guidelines for sound financial management, with an overall long-range perspective to maintain financial solvency and mitigate financial risks associated with revenue instability, volatile capital costs, and unexpected emergencies. • NBS along with City staff have chosen to set the following reserve targets:
• Operating Reserve set equal to 90 days of operating and maintenance expenses, or approximately $1.9 million in FY 2023/24. An operating reserve is intended to promote financial viability in the event of any short-term fluctuation in revenues and/or expenditures, such as those caused by weather patterns, the natural inflow and outflow of cash during billing cycles, natural variability in demand-based revenue streams (e.g., volumetric charges), and - particularly in periods of economic distress - changes or trends in the age of receivables.
• Capital Rehabilitation & Replacement Reserve, at a minimum, should equal 3% of net capital assets, or approximately $1.9 million in FY 2023/24. This reserve is intended to be a cash resource set aside to address long-term capital system replacement and rehabilitation needs.
• Funding Capital Improvement Projects: The City must also be able to fund necessary capital improvements in order to maintain current service levels. City staff has identified roughly $20.2 million in expected capital expenditures for the next five years (FY 2023/24 through FY 2027/28) which is an average of $4 million in capital expenditures annually. Beyond FY 2027/28, an average of $4 million in capital expenditures is expected annually (future year value). With the recommended rate increases, these capital expenditures can be funded without draining existing reserves.
• Inflation and Growth Projections: Assumptions regarding cost inflation were made in order to project future revenues and expenses for the study period. Customer growth is expected to be nearly 1.80% annually. This factor was used in the analysis for some revenues and expenses, and all other inflation factors are based on the Consumer Price Index for all urban consumers in the San Francisco area.9
• Impact of Annual Rate Adjustment Date: The financial plan assumes that rate adjustments occur in January of each year. This means that only about half of the planned revenue to be collected from the rate adjustment listed for one fiscal year will be collected in that year.

However, the rated adjustment in Year 1 is scheduled to occur in April 2024 which means that 9 Website: https://www.bls.gov/cpi/.
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the 9.0% increase in rate revenue planned will result in rates that recover $10.3 million. In other words, due to the timing of when the rates will go into effect, the financial plan results in only $9.4 million in rate revenue that will be collected for FY 2023/24 due to the end of year implementation.
• Figure 2 summarizes the sources and uses of funds, net revenue requirements, and the annual percentage adjustments in total rate revenue recommended for the next 5 years.

Figure 2. Summary of Water Revenue Requirements
Figure 3 summarizes the projected reserve fund balances and reserve targets for the City’s unrestricted funds. A detailed version of the proposed 5-year financial plan is included in Appendix A. The tables in the appendix include the revenue requirement, reserve funds, revenue sources, proposed rate adjustments, capital improvement program, and the proposed rate adjustments needed to meet City’s funding requirements.

Figure 3. Summary of Primary Water Reserve Funds

2.3 Cost-of-Service Analysis
Once the net revenue requirements are determined, the cost-of-service analysis (COSA) proportionately distributes the revenue requirements to each of the customer classes. The COSA consists of two major Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Sources of Water Funds
Rate Revenue Under Prevailing Rates $ 8,410,172 $ 8,544,184 $ 9,441,640 $ 9,611,590 $ 9,774,987 $ 9,941,161 $10,110,161 Non-Rate Revenues 664,001 448,314 473,600 482,125 490,321 498,656 507,134 Interest Earnings (212,625) 215,995 275,008 87,285 61,319 56,589 58,325 Total Sources of Funds $ 8,861,548 $ 9,208,492 $10,190,248 $10,180,999 $10,326,626 $10,496,407 $10,675,619 Uses of Water Funds
560 - Water Treatment Plant $ 1,483,133 $ 1,788,187 $ 2,088,189 $ 3,357,121 $ 2,228,382 $ 2,302,054 $ 2,378,221 565 - Water Distribution 991,284 1,013,187 1,536,149 1,586,987 1,639,520 1,693,803 1,749,895 50 - Public Works 1,356,080 1,616,039 366,768 378,613 390,854 403,506 416,582 Water Purchases 3,380,850 4,035,407 3,602,218 3,674,262 3,747,748 3,822,703 3,899,157 Non-Operating Expenses 1,263,894 1,798,674 2,206,123 2,207,963 2,171,674 2,237,313 2,304,938 Debt Service 523,735 744,109 820,140 823,637 1,468,278 2,523,408 3,014,261 Rate-Funded Capital Expenses 251,795 2,790,541 4,566,877 1,523,075 1,565,040 754,328 665,707 Total Use of Funds $ 9,250,771 $13,786,145 $15,186,464 $13,551,658 $13,211,497 $13,737,114 $14,428,761 Surplus (Deficiency) before Rate Increase $ (389,223) $ (4,577,653) $ (4,996,216) $ (3,370,659) $ (2,884,870) $ (3,240,707) $ (3,753,142) Additional Revenue from Rate Increases1
- - 212,437 1,336,492 2,361,290 3,190,413 3,710,759
Surplus (Deficiency) after Rate Increase $ (389,223) $ (4,577,653) $ (4,783,779) $ (2,034,168) $ (523,580) $ (50,295) $ (42,383) Projected Annual Rate Increase 0.00% 0.00% 9.00% 9.00% 9.00% 4.00% 3.00% Cumulative Rate Increases 0.00% 0.00% 9.00% 18.81% 29.50% 34.68% 38.72% Net Revenue Requirement2 $ 8,799,395 $13,121,837 $14,393,795 $12,938,188 $12,610,375 $13,132,387 $13,813,821

1. Assumes new rates are implemented April 1, 2024.

2. Total use of funds less non-rate revenues and interest earnings.

Summary of Sources and Uses of Funds and
Net Revenue Requirements
5-Year Projected Rate Period Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Operating Reserve
Ending Balance $ 3,245,347 $ 5,727,496 $ 4,142,536 $ 2,278,487 $ 1,930,446 $ 2,055,691 $ 2,188,848 Recommended Minimum Target 1,803,000 2,113,000 1,898,000 2,249,000 2,002,000 2,056,000 2,111,000 Capital Rehabilitation & Replacement Reserve
Ending Balance $ 35,571 $ 3,488,438 $ 2,118,478 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 Recommended Minimum Target 1,420,700 1,548,600 1,870,900 2,079,900 2,260,500 2,370,700 2,458,100 Total Ending Balance $ 3,280,918 $ 9,215,935 $ 6,261,013 $ 4,358,387 $ 4,010,346 $ 4,135,591 $ 4,268,748 Total Recommended Minimum Target $ 3,223,700 $ 3,661,600 $ 3,768,900 $ 4,328,900 $ 4,262,500 $ 4,426,700 $ 4,569,100 Beginning Reserve Fund Balances and
Recommended Reserve Targets
5-Year Projected Rate Period
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components: (1) the classification of expenses, and (2) the allocation of costs to each customer class. Costs are classified corresponding to the function they serve. All costs in the City’s budget are allocated to each component of the rate structure in proportion to the level of service required by customers. The level of service is related to the volume and strength of the water treated, infrastructure capacity, and customer service. These costs are based on allocation factors, such as water consumption, number of meters, and customer class. Ultimately, a COSA is intended to result in rates that are proportional to the cost of providing service to each customer class.

FUNCTIONALIZATION AND CLASSIFICATION OF COSTS
Most costs are not typically allocated just to fixed or variable categories but allocated to multiple functions of water service. The functionalization and classification process provides the basis for allocating costs to various customer classes based on the cost causation (classification) components described below:
• Commodity related costs are costs associated with the change in the volume of water produced and delivered. These commonly include the costs of water quality testing, energy related to pumping for transmission and distribution, and source of supply. • Capacity related costs are costs associated with sizing facilities to meet the maximum, or peak, demand. This includes both operating costs and capital infrastructure costs incurred to accommodate peak system capacity events.
• Customer related costs are costs associated with having a customer connected to the water system, such as meter reading, postage, billing, and other administrative duties. • Recycled Water related costs are costs associated with the collection, treatment, and delivery of recycled water. Recycled water customers have separate fixed and volumetric rates which are discussed further in Section 3.
• Fire Protection related costs are costs associated with providing sufficient capacity in the system for fire meters and other operating and maintenance costs of providing water to properties for private fire service protection.

The City’s budgeted costs were reviewed and allocated to these cost causation components which are used as the basis for establishing new water rates and translated to fixed and variable charges. Tables in the Appendices show how the City’s expenses were classified and allocated to these cost causation components. In the analysis, these cost causation components are also considered to be either fixed or variable.

FIXED AND VARIABLE COSTS
Ideally, utilities should recover all of their fixed costs from fixed charges and all of their variable costs from volumetric rates. When this is the case, fluctuations in water sales revenues would be directly offset by reductions or increases in variable expenses. When rates are set in this manner, they provide greater revenue stability for the utility. However, other factors are often considered when designing water rates, such as community values, water conservation goals, ease of understanding, and ease of administration.10 10 Principles of Water Rates, Fees, and Charges, Manual of Water Supply Practices, Manual M1, AWWA, 7th Edition, 2017, pp. 6 and

96. 67
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NBS functionalized the City’s costs into categories that can be more generally grouped into fixed and variable costs. This analysis resulted in a cost distribution that is approximately 56% fixed and 44% variable (i.e., volumetric or source specific). However, the City has decided on a rate structure that collects 40% of the net revenue requirement from fixed charges and 60% from volumetric rates. This rate structure will provide financial stability for the City, while maintaining a tiered rate structure that encourages water conservation. The proposed new rates are based on these allocations.

Figure 4 summarizes how costs are allocated to each cost component and used to establish new water rates. Figure 5 shows the resulting cost allocation to each cost classification component. The remaining revenue requirements are allocated to capacity, customer, and fire protection cost categories.

Figure 4. Allocation Percentages of Revenue Requirements Figure 5. Allocated Net Revenue Requirements

2.4 Characteristics of Water Customers by Customer Class Customer classes are typically determined by grouping customers with similar demand characteristics into categories that reflect the cost differentials to serve each type of customer. Customer classes are most often identified as single family, multi-family, commercial, landscape, etc., and the City follows this common methodology. The rates proposed in this report follow a similar structure where the fixed charges within each customer class vary by meter size. Variable rates are tiered (two tiers) for single family residential (SFR); all other customers are charged a uniform volumetric rate.

The amount of consumption, the peaking factors, and the number of meters by size are used to allocate costs as a part of COSA to allocate costs to customer classes and determine the appropriate rate structures for each. These components of the COSA are presented in the following figures.

Commodity-Related Costs $ 6,174,833 60.0%
Capacity-Related Costs 3,709,181 36.0%
Customer-Related Costs 300,640 2.9%
Fire Protection-Related Costs 106,734 1.0%
Net Revenue Requirement $ 10,291,388 100.0%
Classification Components

PROPOSED ALTERNATIVE
Cost-of-Service Net Revenue
Requirements (FY 2023/24)

VARIABLE
Residential $ 3,092,204 $ 1,565,159 $ 214,963 $ - $ 4,872,326 47.3% Multi-Family 546,290 1,777,034 56,075 - 2,379,400 23.1% Commercial 1,943,118 221,463 15,109 - 2,179,689 21.2%
Landscape 323,989 38,794 3,216 - 365,999 3.6%
Private Fire Protection 139,154 77,779 10,792 106,734 334,458 3.2% Temporary Hydrant Meters 50,606 16,254 352 67,213 0.7%
Raw Water 79,472 12,699 132 - 92,303 0.9%
Total Net Revenue Requirement $ 6,174,833 $ 3,709,181 $ 300,640 $ 106,734 $ 10,291,388 100% Customer Classes Cost of Service
Net Rev. Req'ts
% of COS Net
Revenue
Req'ts
CapacityRelated Costs
Classification Components
CustomerRelated CostsFire ProtectionRelated CostsCommodityRelated Costs FIXED
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Commodity related costs are costs associated with the total annual consumption of water by customer class. Figure 6 below summarizes the most recent consumption data by customer class and represents the expected percent of consumption over the 5-year rate period.

Figure 6. Water Consumption by Customer Class
Figure 7 shows the capacity allocation factors for each customer class.

Figure 7. Capacity Factors by Customer Class
Customer Class
FY 2021/22
Consumption
(hcf)
% Adjustment for
Conservation2
Est. FY 2021/22
Volume
Adjusted for
Conservation
FY 2021/22
% of Total
Volume
Residential 507,339 20.0% 405,871 50.1%
Multi-Family 89,630 20.0% 71,704 8.8%
Commercial 318,808 20.0% 255,046 31.5%
Landscape 53,157 20.0% 42,526 5.2%
Private Fire Protection 22,831 20.0% 18,265 2.3%
Temporary Hydrant Meters 8,303 20.0% 6,642 0.8%
Raw Water 13,039 20.0% 10,431 1.3%
Total 1,013,107 810,486 100%

1. Consumption data is based on the City of American Canyon's billing data.

2. A conservation factor of 20% included in table above based on the "20 by 2020" law passed in 2009.

Source: https://www.ca-ilg.org .

Customer Class Meter Size1 No. of Meters
Hydraulic
Capacity
Factors2
Total
Equivalent
Meters
% of EDUs
Residential 4,880 4,930 42.2%
< 1" meter 1,986 1.00 1,986
1" meter 2,875 1.00 2,875
1 1/2" meter 7 2.00 14
2" meter 9 3.20 29
3" meter 1 6.40 6
4" meter 2 10.00 20
Multi-Family 556 5,598 47.9%
1 1/2" meter 20 2.00 40
2" meter 201 3.20 643
3" meter 96 6.40 614
4" meter 48 10.00 480
6" meter 191 20.00 3,820
Commercial 343 698 6.0%
< 1" meter 102 1.00 102
1" meter 88 1.00 88
1 1/2" meter 54 2.00 108
2" meter 81 3.20 259
3" meter 11 6.40 70
4" meter 7 10.00 70
Landscape 73 122 1.0%
< 1" meter 13 1.00 13
1" meter 30 1.00 30
1 1/2" meter 14 2.00 28
2" meter 16 3.20 51
Private Fire Protection 245 245 2.1%
< 1" meter 245 1.00 245
Temporary Hydrant Meters 8 51 0.4%
3" meter 8 6.40 51
Raw Water 3 40 0.3%
4" meter 2 10.00 20
6" meter 1 20.00 20
Total 6,108 11,684 100%

1. Meter by class and size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1. 69 Enterprise Rate Study – City of American Canyon
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Figure 8 shows the number of meters for each customer class. The percentage of total customers by customer class is then used to develop the customer allocation factors in order to allocate customer costs.

Customer costs are those costs associated with having customers connected to the water system and include costs related to meter reading, postage, and billing.

Figure 8. Number of Meters by Customer Class

2.5 Rate Design Analysis
The process of evaluating the water rate structure provides the opportunity to review and incorporate ratedesign objectives and policies, including revenue stability, equity among customers, and water conservation. NBS discussed several water rate alternatives and methodologies with City Staff over the course of this study, such as the percentage of revenue collected from fixed charges vs. variable rates and differentiating rates by customer class. Ultimately, City staff selected a rate alternative that is similar to the results of the COSA that includes a fixed service charge based on customer class and meter size. The following sections describe this process. The selected rate structure also maintains the existing two tiers for single family residential customers and proposes a uniform tier for all other customer classes.

The following sections describe how the proposed water rates were developed.

DEVELOPMENT OF PROPOSED RATES
Fixed Service Charges
The fixed meter charge recognizes that the water utility incurs fixed costs regardless of whether customers actually use water. There are two components that comprise the fixed meter charge: (1) the customer component, and (2) the capacity component. The customer components are those costs related to reading and maintaining meters, customer billing and collection, and other customer service-related costs. The capacity component recovers costs associated with sizing the water system to ensure there is sufficient capacity in the system to meet peak demand. A user class with higher peaking (capacity) needs is allocated a proportionately higher share of the capacity related costs compared to customer classes with lower peaking needs.

Customer Class
No. of
Meters/Accounts
FY 2021/221
% of Total Meters
Residential 4,880 71.5%
Multi-Family21,273 18.7%
Commercial 343 5.0%
Landscape 73 1.1%
Private Fire Protection 245 3.6%
Temporary Hydrant Meters 8 0.1%
Raw Water 3 0.0%
Total 6,825 100.0%

1. Meter count data is based on the City's billing data for June 2022.

2. Multi-family residential customers are by dwelling units. 70 Enterprise Rate Study – City of American Canyon
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Meter sizes have different fixed charges based on their capacity requirements, where larger meters have the potential to use more of the system’s capacity11 or, said differently, they can have higher peaking factors compared to smaller meters. The potential capacity demanded (peaking) is proportional to the maximum hydraulic flow through each meter size based on the hydraulic capacity ratios established by AWWA.
12 The AWWA capacity ratios used for this report are shown in Figure 9.

Figure 9. Hydraulic Capacity Factors
The actual number of meters by size is multiplied by the corresponding capacity ratios to calculate equivalent meters. The number of equivalent meters is used as a proxy for the potential demand that each customer can place on the water system. Figure 10 summarizes the number of meters, the hydraulic capacity factors, and the number of equivalent meters (i.e., the number of meters multiplied by the hydraulic capacity factor) by customer class and meter size.

Figure 10. Equivalent Meters
Using the costs allocated to each customer class from Figure 5, Figure 11 shows the calculation of the fixed monthly service charges for all customer classes based on meter size. As previously mentioned, the customer service charge is calculated by dividing the customer service-related costs by the total number of 11 System capacity is the system’s ability to supply water to all delivery points at the time when demanded. 12 Principles of Water Rates, Fees and Charges, Manual of Water Supply Practices, Manual M1, AWWA, 7th Edition, 2017, p. 386.

Water Meters – Selection, Installation, Testing and Maintenance, Manual M6, AWWA, 5th Edition, 2012, pp. 63-65. 5/8 inch 20 1.00
3/4 inch 30 1.00
1 inch 50 1.00
1 1/2 inch 100 2.00
2 inch 160 3.20
3 inch 320 6.40
4 inch 500 10.00
6 inch 1,000 20.00
8 inch 1,600 32.00
10 inch 4,200 84.00
12 inch 5,300 106.00

1. Per AWWA, M1 Manual, Table B-1.

Compound Class I Meters
Turbine Class II Meters
Meter Capacity
(gpm)1
Meter Size Equivalency
to 1 inch
Displacement Meters
Standard Meters
< 1" meter 1" meter 1 1/2" meter 2" meter 3" meter 4" meter 6" meter 8" meter Residential 1,986 2,875 7 9 1 2 0 0 4,880
Multi-Family 0 0 20 201 96 48 191 0 556
Commercial 13 30 14 16 0 0 0 0 73
Commercial 102 88 54 81 11 7 0 0 343
Private Fire Protection 245 0 0 0 0 0 0 0 245
Temporary Hydrant Meters 0 0 0 0 8 0 0 0 8
Raw Water 0 0 0 0 0 2 1 0 3
Total Meters/Accounts 2,346 2,993 95 307 116 59 192 0 6,108 Hydraulic Capacity Factor 2 1.00 1.00 2.00 3.20 6.40 10.00 20.00 32.00 Total Equivalent Meters 2,346 2,993 190 982 742 590 3,840 0 11,684

1. Meter by Class and Size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

Number of Meters by Class and Size Total 1 FY 2023/24
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meters, whereas the fixed capacity charge is calculated by dividing the capacity-related costs by the total number of equivalent meters for each meter size.

Figure 11. Calculation of Fixed Service Charges (Residential) Volumetric Rates
Currently, the City uses a 2-tier rate structure for residential customers (i.e., single family customers), while all other customers are charged a uniform, or single tier, volumetric rate. The following sections of this report describe how the tiered rates were developed.

Source of Supply
The City has three primary sources of supply: (1) State Water Project (SWP); (2) Cities of Napa and Vallejo treated water; and (3) City of Vallejo raw water. Figure 12 shows how these supply sources are allocated to each tier. A description of how this allocation was developed is included in Appendix A.

Figure 12. Summary of Supply Sources Allocated to Tiers Figure 13 shows the amount of each source of supply that is included in the tiers for residential customers. < 1" meter 1" meter 1 1/2" 2" meter 3" meter 4" meter 6" meter 8" meter Monthly Fixed Service Charges
Customer Costs ($/Acct/month) $4.10 $4.10 $4.10 $4.10 $4.10 $4.10 $4.10 $4.10 Capacity Costs ($/Acct/month) $27.22 $27.22 $54.43 $87.09 $174.19 $272.17 $544.33 $870.93 Total Monthly Meter Charge $31.32 $31.32 $58.53 $91.19 $178.29 $276.27 $548.43 $875.03 Annual Fixed Costs Allocated to Monthly Meter Charges
Customer Costs $ 300,640
Capacity Costs 3,815,915
Total Fixed Meter Costs $4,116,555
Annual Revenue from Monthly Meter Charges
Customer Charges $ 115,491 $ 147,298 $ 4,676 $ 15,111 $ 5,710 $ 2,904 $ 9,450 $ - $ 300,640 Capacity Charges $ 766,330 $ 977,381 $ 62,054 $ 320,851 $ 242,467 $ 192,693 $1,254,139 $ - $3,815,915 Total Revenue from Monthly Meter Charges $ 881,821 $1,124,680 $ 66,730 $ 335,961 $ 248,177 $ 195,597 $1,263,590 $ - $4,116,555 Number of Meters by Class and Size Total FY 2023/24
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Figure 13. Allocated Consumption from Each Source of Supply Residential Tiered Rates
Before the tiered rates could be developed, expected consumption in each tier was determined, and tier breakpoints were established. The breakpoint for Tier 1 was set so that expected consumption within each tier would most closely match the allocated consumption by that source. That is, the amount of expected consumption in Tier 1 would correspond to the amount of water that the SWP and the City of Vallejo (raw water) could supply. Similarly, expected consumption in Tier 2 corresponds to the amount of treated water supply from the cities of Napa and Vallejo.

For residential customers, the tier breakpoints were identified by first determining the quantity available in each tier (see Figure 13). Once the quantity of water by tier is determined, individual customer billing records are analyzed to determine what tier breakpoint would maximize the use of water in each tier. The resulting breakpoint was determined to be the 6 HCF as shown in Figure 14. The amount of estimated consumption in Tier 1 differs slightly from the allocated consumption due to the fact that monthly reads for all customers are not precise.

Figure 14. Tier Breakpoints for Residential Customers
Once the expected consumption by tier was determined, the expenses assigned to commodity-related costs, previously shown in Figure 4, were spread over the expected consumption resulting in the rates shown in Figure 15.

Figure 15. Tiered Rates for FY 2023/24
Uniform Rates
Expected consumption in the uniform tier accounts for the remaining amount of supply from all three water sources. Figure 16 identifies the uniform tier rate per unit of water for all non-residential customers.

In AF In HCF
SWP (Contracted Purchase) 3,590 1,563,804 81.5%
Vallejo Raw Water (Contracted Purchase) 500 217,800 11.4% Treated Water (Contracted Purchase)1 313 136,181 7.1%
Totals 4,403 1,917,785 100.0%
Source of Supply
Total Contracted Purchases Acre Feet as a
% of Total
Tier 1 - SWP & Vallejo Raw Water 322,836 79.5%
Tier 2 - Treated Water (Napa & Vallejo) 83,035 20.5%
Total 405,871 100.0% 7.0
% of
Consumption
Consumption
Avg. Monthly
Consumption
FY 2020/21 (hcf)
Tier
Breakpoint
(hcf)

6.00 Residential Tiers
Supply Costs
Allocated to
Residential
Tiered Rates
Source of
Supply Costs
Other Costs
Allocated to
Vol. Rates
Total Costs
Allocated
FY 2020/21
Consumption
Residential
Rates ($/HCF)
Residential Tiered Rate Costs (1) (2) (3) (4) (5) (6)
Tier 1 - SWP & Vallejo Raw Water 79.5% $ 565,431 $ 1,716,250 $ 2,281,681 322,836 $7.07 Tier 2 - Treated Water (Napa & Vallejo) 20.5% 369,096 441,426 810,523 83,035 $9.76 Total Residential Tiered Rate Costs 100.0% $ 934,527 $ 2,157,676 $ 3,092,204 405,871 Source of Supply
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Figure 16. Uniform Tier Rates for FY 2023/24
The rate for each unit of water is determined by dividing costs to recover, or total target revenue requirements, per tier by the estimated consumption. The tiered rates per HCF are identified as follows:
• Residential Tier 1 is equal to the costs for water from the SWP and the raw water from the City of Vallejo.
• Residential Tier 2 is equal to the treated water costs for the cities of Napa and Vallejo. • Uniform Tier is equal to all remaining water supply costs not allocated to residential customers from SWP and the cities of Napa and Vallejo.

In addition to developing the uniform volumetric rates shown in Figure 16, the City Council requested an alternative analysis that was based on the City’s current volumetric water rate increased by three percent a year, with the fixed charges remaining as proposed. This analysis compared the revenue generated from the cost of service volumetric rates with the rates generated using three percent escalation. Figure 17 compares the revenue generation from the two approaches.

Customer Classes
Number of
Meters1
Water
Consumption
(hcf/yr)2
Total Target
Rev. Req't from
Vol. Charges
% of Total Rate
Revenue
Uniform
Commodity
Rates ($/hcf)
Proposed Rate
Structure
Residential 4,880 405,871 $ 3,092,204 30.0% n/a 2 Tiers Multi-Family 1,273 71,704 546,290 5.3% $7.619 Uniform
Commercial 343 255,046 1,943,118 18.9% $7.619 Uniform
Landscape 73 42,526 323,989 3.1% $7.619 Uniform
Private Fire Protection 245 18,265 139,154 1.4% $7.619 Uniform Temporary Hydrant Meters 8 6,642 50,606 0.5% $7.619 Uniform Raw Water 3 10,431 79,472 0.8% $7.619 Uniform
Total Potable Water 6,825 810,486 $ 6,174,833 60%

1. Consumption data is based on the City of American Canyon's billing data.

2. Water consumption is actual consumption for FY 2021/22 and includes an adjustment of 20% for conservation. See Table 28. 74 Enterprise Rate Study – City of American Canyon
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Figure 17. Variable Revenue Comparison

2.6 Proposed Water Rates
Currently, all customers are subject to a fixed service charge that varies by meter size and volumetric rates based on consumption for the various customer classes. The cost-of-service analysis (COSA) by nature “rebalances” how costs are allocated between customer classes and, as a result, there are uneven adjustments in the first year of the 5-year rate adoption period. In contrast, in the subsequent four years of the rate planning period, proposed charges are simply adjusted by the proposed adjustment in total rate revenue needed to meet projected revenue requirements.

The following figures provide a comparison of the current and proposed water rates for FY 2023/24 through 2027/28 for each customer class and meter size. Projected rates for FY 2023/2413 reflect adjustments based on the COSA. More detailed tables on the development of the proposed water rates are documented in Appendix A.
13 All rate adjustments are scheduled to be effective on January 1st except Year 1 which will be implemented on April 1, 2024.

ALTERNATIVE 1 (COSA)
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Residential
Tier 1 - SWP & Vallejo Raw Water $ 2,459,588 $ 2,487,033 $ 2,710,866 $ 2,819,300 $ 2,903,879 Tier 2 - Treated Water (Napa & Vallejo) 632,616 883,470 962,982 1,001,501 1,031,546 Multi-Family 546,290 595,456 649,047 675,009 695,259
Commercial 1,943,118 2,117,998 2,308,618 2,400,963 2,472,992 Landscape 323,989 353,148 384,931 400,329 412,339
Private Fire Protection 139,154 151,678 165,329 171,942 177,100 Temporary Hydrant Meters 50,606 55,161 60,125 62,530 64,406 Raw Water 79,472 86,624 94,421 98,198 101,143
Total $ 6,174,833 $ 6,730,567 $ 7,336,319 $ 7,629,771 $ 7,858,664 ALTERNATIVE 2 - INCREASE CURRENT VARIABLE RATES BY 3% ANNUALLY FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Residential
Tier 1 - SWP & Vallejo Raw Water $ 2,507,212 $ 2,582,428 $ 2,659,901 $ 2,739,698 $ 2,821,889 Tier 2 - Treated Water (Napa & Vallejo) 697,036 717,947 739,485 761,670 784,520 Multi-Family 570,162 587,266 604,884 623,031 641,722
Commercial 2,028,027 2,088,868 2,151,534 2,216,080 2,282,562 Landscape 338,147 348,291 358,740 369,502 380,587
Private Fire Protection 72,617 74,796 77,040 79,351 81,731 Temporary Hydrant Meters 52,818 54,402 56,034 57,715 59,447 Raw Water 36,960 38,069 39,211 40,387 41,599
Total $ 6,302,977 $ 6,492,067 $ 6,686,829 $ 6,887,434 $ 7,094,057 Difference $ (128,145) $ 238,501 $ 649,490 $ 742,338 $ 764,608 Customer Class COSA Revenue
Customer Class COSA Revenue
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Figure 18. Current and Proposed Water Rates - Fixed Charges FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges (in $/mo)
Residential Use
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $26.56 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $26.56 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $26.56 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $26.56 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $26.56 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $26.56 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Multi-Family, Commercial and Landscape
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter (Residential) $26.56 $31.32 $34.14 $37.21 $38.70 $39.86 1" meter (Commercial) $44.42 $31.32 $34.14 $37.21 $38.70 $39.86 1 1/2" meter $88.75 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $1,420.06 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Private Fire Protection
< 1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $13.28 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $13.28 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $13.28 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $13.28 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $13.28 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $13.28 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Temporary Hydrant Meters
< 1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $283.98 $58.53 $63.80 $69.55 $72.33 $74.50 2" meter $283.98 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $283.98 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $283.98 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $283.98 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Raw Water
< 1" meter n/a $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $44.42 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter n/a $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter n/a $178.29 $194.33 $211.82 $220.30 $226.91
4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter n/a $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Water Rate Schedule Current Proposed Rates
Rates
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Figure 19. Current and Proposed Water Rates - Variable Rates (COSA) Figure 20. Current and Proposed Water Rates - Variable Rates (Alternative 2)

2.7 Comparison of Current and Proposed Water Bills
Figure 21 and Figure 22 compare a range of monthly water bills under the current and proposed water rates for residential and commercial customers. These monthly bills are based on typical meter sizes and highlight the average consumption levels for each customer.

Figure 21. Monthly Water Bill Comparison for Residential Customers FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Residential Use
Tier 1 (0 - 6 units) $7.54 $7.07 $7.70 $8.40 $8.73 $8.99 Tier 2 (> 6 units) $8.15 $9.76 $10.64 $11.60 $12.06 $12.42 Multi-Family, Commercial and Landscape $7.72 $7.62 $8.30 $9.05 $9.41 $9.70 Private Fire Protection $3.86 $7.62 $8.30 $9.05 $9.41 $9.70 Temporary Hydrant Meters $7.72 $7.62 $8.30 $9.05 $9.41 $9.70 Raw Water $3.44 $7.62 $8.30 $9.05 $9.41 $9.70
Variable Rates for All Water Consumed (in $/hcf)
Water Rate Schedule Current
Rates
Proposed Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Residential Use
Tier 1 (0 - 6 units) $7.54 $7.77 $8.00 $8.24 $8.49 $8.74 Tier 2 (> 6 units) $8.15 $8.39 $8.65 $8.91 $9.17 $9.45
Multi-Family, Commercial and Landscape $7.72 $7.95 $8.19 $8.44 $8.69 $8.95 Private Fire Protection $3.86 $3.98 $4.10 $4.22 $4.34 $4.47 Temporary Hydrant Meters $7.72 $7.95 $8.19 $8.44 $8.69 $8.95 Raw Water $3.44 $3.54 $3.65 $3.76 $3.87 $3.99
Water Rate Schedule Current
Rates
Proposed Rates
Variable Rates for All Water Consumed (in $/hcf)
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Figure 22. Monthly Water Bill Comparison for Commercial Customers

2.8 Drought Rates
The City is obligated to meet its annual net revenue requirements to keep the utility operating and functional regardless of whether consumption levels decline due to conservation or other unexpected events (e.g., unseasonal weather, natural disasters, etc.). At the request of the City, drought rates have been developed so that if total consumption should decrease further due to an increase in conservation required by the state, another regulatory agency, or if the City Council declares that it is in more severe drought stages, the City’s water utility would still be kept whole, financially. In the event that consumption decreases beyond projected baseline consumption levels, some costs will also decrease, and the proposed drought rates have taken this reduced revenue need into consideration.14 Figure 23 shows the expenses directly impacted by conservation over the next five years. Because these expenses are a significant portion of the City’s budget, drought rates will offset the loss of variable revenue, if needed and implemented by the City in different stages of drought severity.

Figure 23. Expenses Directly Impacted by Conservation
14 Details regarding the calculation of the drought rates can be found in Appendix A.

FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
City of Napa $ 278,000 $ 283,560 $ 289,231 $ 295,016 $ 300,916 North Bay Aqueduct 3,203,000 3,267,060 3,332,401 3,399,049 3,467,030 City of Vallejo 121,218 123,642 126,115 128,638 131,210 Total: $ 3,602,218 $ 3,674,262 $ 3,747,748 $ 3,822,703 $ 3,899,157 Description
Commodity-Related Costs
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Figure 24 shows the calculation of the updated commodity costs for each percentage of conservation the City is looking to achieve with the drought rates for FY 2023/24. Figure 25 presents the proposed drought surcharge that would replace the uniform volumetric rate (shown in Figures 19 and 20) at each stage of conservation through FY 2027/28.

The projected monthly revenues should be based on the FY 2020/21 monthly consumption levels adjusted for conservation and the volumetric rate. Key aspects of the drought rates include:
• The drought surcharge was developed using water usage for FY 2020/21, the same assumption used in the proposed volumetric rates.
• The City Council must activate the drought rate surcharge. If the surcharge is activated, it will remain in effect as necessary and will be reviewed by the City Council at a minimum of every six (6) months for determination of necessity until the surcharge is deactivated. • The drought rate surcharge is added to the uniform volumetric rate on a per unit basis to cover the cost of water service during times of mandated conservation and/or extreme water supply shortage.

Figure 24. Projected Consumption at Baseline and Each Successive Drought Stage Figure 25. Proposed Drought Surcharges
Shortage
Level
Percent Shortage
Range
Potable Water
Consumption
(AF/yr.)
Potable Water
Consumption
(hcf/yr.)
Difference to
Baseline (hcf)
Baseline Consumption2 1,861 810,486 0
1 Up to 10% Voluntary Conservation 1,675 729,437 (81,049) 2 Up to 20% Water Alert 1,488 648,388 (162,097)
3 Up to 30% Water Emergency 1,302 567,340 (243,146)
4 Up to 40% Critical Water Emergency 1,116 486,291 (324,194) 5 Up to 50% Severe Water Emergency 930 405,243 (405,243) 6 >50% Catastrophic Interruption of Water Supplies 744 324,194 (486,291)

1. Drought stages based on the City's Water Conservation Plan. Source files: 2._Redlines_Ordinance_Water_Conservation_Plan_Chapter_13.14 (4).pdf & 3._Table_8-1_Water_Shortage_Contingency_Plan_Levels.pdf .

2. This represents the baseline consumption for FY 2021/22 consumption (excludes recycled water). Conservation percentage for each drought stage is relative to the baseline consumption.

Shortage Response Action
2021/22 Consumption Assumptions1
Drought Rate Schedule (in $/hcf) Current
Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
10% Conservation n/a $0.35 $0.44 $0.53 $0.58 $0.62
20% Conservation n/a $0.79 $0.98 $1.19 $1.30 $1.39
30% Conservation n/a $1.36 $1.68 $2.03 $2.23 $2.39
40% Conservation n/a $2.12 $2.61 $3.16 $3.46 $3.71
50% Conservation n/a $3.17 $3.92 $4.75 $5.20 $5.57
60% Conservation n/a $4.76 $5.88 $7.12 $7.79 $8.36
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3. Recycled Water Rate Study

3.1 Key Recycled Water Rate Study Issues
Recycled water rates face a unique set of challenges in determining what rates should be charged.

Regardless of actual system costs, rates cannot exceed what the “market” can bear, or else recycled water customers will likely use alternative sources. This has often resulted in setting these rates arbitrarily low so that they do not exceed the costs of alternative sources (or exceed potable prices). Actual costs are also unclear because typically wastewater customers often benefit from reclaimed water as it tends to reduce wastewater disposal costs.

The primary issues addressed in this study for the recycled water system were: (1) ensuring rates generate a reasonable level of revenue to pay for operating costs of the system, and (2) establishing reasonable rates that are competitive with other sources of irrigation water while ideally recovering basic operating costs.

Currently, the City does not have separate fixed charges and volumetric rates for recycled water customers, so NBS worked with City staff to determine the appropriate cost allocations of sewer treatment and distribution costs that recycled water customers should pay. The following sections describe the results of this analysis.

3.2 Recycled Water Utility Revenue Requirements
A cost-of-service analysis was performed, and rates were designed to collect 80% of the rate revenue from variable rates and 20% from fixed rates. Recycled water connections represent about 1.1% of all the City’s meters. Figure 26 summarizes the sources and uses of funds, net revenue requirements, and the annual percentage adjustments in total rate revenue recommended for the next 5 years, and Figure 27 summarizes the recycled water revenue requirements for FY 2023/24.

Figure 26. Summary of Recycled Water Revenue Requirements Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Sources of Water Funds
Rate Revenue Under Prevailing Rates $ 151,038 $ 226,361 $ 207,000 $ 210,726 $ 214,308 $ 217,952 $ 221,657 Interest Earnings 4,101 12,392 22,343 2,195 7,873 4,912 2,640 Total Sources of Funds $ 155,140 $ 238,753 $ 229,343 $ 212,921 $ 222,182 $ 222,864 $ 224,297 Uses of Water Funds
Fund 580 - Recycled Water Operations $ 272,644 $ 1,632,152 $ 893,163 $ 797,921 $ 823,477 $ 849,857 $ 877,086 Interfund Loan Repayment - - 198,566 198,566 267,497 267,497 267,497 Rate-Funded Capital Expenses - - - - - - -
Total Use of Funds $ 272,644 $ 1,632,152 $ 1,091,728 $ 996,487 $ 1,090,974 $ 1,117,354 $ 1,144,583 Surplus (Deficiency) before Rate Increase $ (117,504) $ (1,393,399) $ (862,386) $ (783,566) $ (868,793) $ (894,490) $ (920,286) Additional Revenue from Rate Increases1 - - 129,375 563,692 652,033 728,149 788,637 Surplus (Deficiency) after Rate Increase $ (117,504) $ (1,393,399) $ (733,011) $ (219,874) $ (216,759) $ (166,341) $ (131,650) Projected Annual Rate Increase 0.00% 0.00% 250.00% 10.00% 10.00% 5.00% 5.00% Cumulative Rate Increases 0.00% 0.00% 250.00% 285.00% 323.50% 344.68% 366.91% Net Revenue Requirement2 $ 268,543 $ 1,619,760 $ 1,069,386 $ 994,292 $ 1,083,101 $ 1,112,441 $ 1,141,943

1. Assumes new rates are implemented April 1, 2024.

2. Total use of funds less interest earnings.

Summary of Sources and Uses of Funds and
Net Revenue Requirements
5-Year Projected Rate Period
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Figure 27. Summary of Recycled Water Revenue Requirements for FY 2023/24

3.3 Proposed Recycled Water Rates
Fixed Charges
Fixed charges have been calculated in the same manner as potable water fixed charges. Figure 28 shows the calculation of the monthly fixed meter charges. In total, the fixed and variable charges collect the target revenue from recycled water customers as shown previously in Figure 27.

Figure 28. Recycled Water Fixed Rate Calculation
Given the amount of consumption relative to the number of meters in the recycled water system, it is expected that 80% of the rate revenue will be collected from the variable charge. Figure 29 calculates the volumetric rate per HCF and the fixed monthly charge per equivalent meter (monthly fixed charges will be based on meter size).

Figure 29. Recycled Water Variable Rate Calculation

3.4 Current vs. Proposed Recycled Water Rates
Using the same hydraulic capacity factors listed in Figure 9, monthly fixed charges were developed for each meter size. Figure 30 shows the current and proposed recycled water rates for FY 2023/24 through FY Variable (Collected from Vol. Rates) $ 855,509 80%
Fixed (Collected from Fixed Charges) 213,877 20%
Net Revenue Requirement $ 1,069,386 100%
Recycled Water
Classification Components
Cost-of-Service Net Revenue
Requirements (2023/24)
Total
< 1" meter 1" meter 1 1/2" 2" meter 3" meter 4" meter 6" meter 8" meter Recycled Water
Recycled Water 2 13 14 28 13 6 0 0 76
Total Meters/Accounts 2 13 14 28 13 6 0 0 76
Hydraulic Capacity Factor 2 1.00 1.67 3.33 5.33 10.67 16.67 33.33 53.33 Total Equivalent Meters 2 22 47 149 139 100 0 0 458
Monthly Fixed Service Charges
Fixed Charge ($/EM/month)3 $38.89 $38.89 $38.89 $38.89 $38.89 $38.89 $38.89 $38.89 Fixed Monthly Charge $38.89 $64.81 $129.62 $207.40 $414.79 $648.11 $1,296.23 $2,073.96 Annual Fixed Costs Allocated to Monthly Meter Charges
Total Revenue from RW Meter Charges $ 933 $ 10,111 $ 21,777 $ 69,685 $ 64,708 $ 46,664 $ - $ - $ 213,877

1. Meter by Class and Size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

3. Cost per month per equivalent meter. Monthly fixed charges are set for each meter size using the hydraulic capacity factors and total equivalent meters.

Number of RW Meters
by Class and Size1
FY 2023/24
Recycled Water
Recycled Water 272,268 458 100.0% $ 855,509 $ 213,877 $ 1,069,386 $3.14 $38.89 Total Net Revenue Requirement 272,268 458 100.0% $ 855,509 $ 213,877 $ 1,069,386 -- --

1. Source file: 2020 Urban Water Management Plan , Figure 6.4.

2. Number of meters by size times the hydraulic capacity factor for each meter size. Source: AWWA, Manual M1, Table B-1 & AWWA, Manual M6, Table 5-3.

3. Total Variable Costs times the proportional share of annual RW consumption.

4. Fixed costs times the percent of equivalent meters.

5. Total Variable Costs divided by Total Annual RW Consumption.

6. Total Fixed Costs divided by total Equivalent Meters. This provides the basis for monthly fixed charges for each meter size.

RW Fixed
Charges
($/Eq. Meter/
Month) 6
RW
Volumetric
Rate
($/hcf)5
No. of Equiv.

Meters
Equivalent Meters2
% of Equiv.

Meters
Recycled Water Customers
Cost Allocation Factors
Net Revenue
Req'ts
Annual RW
Consumption1
Fixed
Costs4
Variable
Costs3
Cost Classifications
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2027/28. The self-haul rate was based on the current self-rate, then escalated at the same rate as the delivered recycled water.

Figure 30. Current and Proposed Recycled Water Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges (in $/mo)
< 1" meter $26.56 $38.89 $42.78 $47.05 $49.41 $51.88
1" meter $44.42 $64.81 $71.29 $78.42 $82.34 $86.46
1 1/2" meter $88.75 $129.62 $142.58 $156.84 $164.69 $172.92 2" meter $141.99 $207.40 $228.14 $250.95 $263.50 $276.67 3" meter $283.98 $414.79 $456.27 $501.90 $526.99 $553.34 4" meter $443.74 $648.11 $712.92 $784.22 $823.43 $864.60 6" meter $887.48 $1,296.23 $1,425.85 $1,568.43 $1,646.85 $1,729.20 8" meter $1,420.06 $2,073.96 $2,281.36 $2,509.49 $2,634.97 $2,766.71 Commodity Charges for All Water Consumed (in $/hcf)
Variable Charge $0.90 $3.14 $3.46 $3.80 $3.99 $4.19
Variable Charge - Self-Haul n/a $1.88 $2.07 $2.28 $2.39 $2.51 Recycled Water Rate Schedule Current
Rates
Proposed Rates
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4. Sewer Rate Study

4.1 Key Sewer Rate Study Issues
The City manages a wastewater system for approximately 6,150 customers within its service area. The City owns and operates the American Canyon Water Reclamation Facility (WRF) that collects and treats wastewater for both domestic and industrial customers. The City’s wastewater rate analysis was undertaken with a few specific objectives, including:
• Ensure equity among customer classes by collecting rate revenue through the cost-of-service process based on both fixed monthly charges and volumetric rates. • Maintain adequate reserve levels to ensure continuity in operations. • Provide greater revenue stability for the utility, due to the level of capital investment planned over the next five years.
• Comply with Prop 218 requirements to ensure cost-of-service are properly allocated amongst user classifications.

4.2 Financial Plan
Similar to the water utility, it is important for the wastewater utility to ensure rates provide sufficient funding to cover operating and maintenance costs, planned capital expenditures, and maintain reasonable reserves. The wastewater utility’s rate increases are governed by these needs, and the current state of City’s wastewater utility is as follows:
• Meeting Net Revenue Requirements: For FY 2023/24 through FY 2027/28, the projected net revenue requirements (that is, total operating expenses plus rate-funded capital costs less nonrate revenues) for the City averages approximately $8.5 million, annually. If no rate adjustments are implemented, the City is projected to average a $3.3 million deficit each year. • Maintaining Reserve Funds: Reserve funds provide a basis for a utility to cope with fiscal emergencies such as revenue shortfalls, asset failure, and natural disasters, among other events. Reserve policies provide guidelines for sound financial management, with an overall long-range perspective to maintain financial solvency and mitigate financial risks associated with revenue instability, volatile capital costs, and emergencies. NBS recommends that the City target a minimum of approximately $2.9 million in unrestricted reserve funds over the 5-year period. The reserve funds for the sewer utility are considered unrestricted reserves and consist of the following:
• Operating Reserve should equal approximately 90 days of operating expenses, or approximately $1.8 million annually. An operating reserve is intended to promote financial viability in the event of any short-term fluctuation in revenues and/or expenditures. Fluctuations in revenue can be caused by weather patterns, the natural inflow and outflow of cash during billing cycles, natural variability in demand-based revenue streams (such as volumetric charges), and – particularly in periods of economic distress – changes or trends in age of receivables.
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• Capital Rehabilitation & Replacement Reserve should equal approximately 3% of net capital assets which is approximately $936,000 in FY 2023/24. This reserve is set aside to address long-term capital system replacement and rehabilitation needs.

Rate revenue increases will be needed throughout the 5-year rate adoption period in order to fully fund all operating expenses and planned capital projects as well as maintain reserves at the recommended targets.

Figure 31 summarizes the sources and uses of funds, net revenue requirements, and the recommended annual increases in wastewater rate revenue proposed for the next 5 years.

Figure 31. Summary of Wastewater Revenue Requirements
Figure 32 summarizes the projected reserve fund balances and reserve targets for the sewer utility’s unrestricted funds. A more detailed version of the utility’s proposed 5-year financial plan is included in Appendix C. The appendix tables include revenue requirements, reserve funds, revenue sources, proposed rate increases, and the City’s capital improvement program. As Figure 32 shows, given the proposed rate increases, reserves are well over the minimum target balances.

Figure 32. Summary of Sewer Reserve Funds

4.3 Cost-of-Service Analysis
Once the net revenue requirements are determined, the cost-of-service analysis (COSA) proportionately distributes the revenue requirements to each of the customer classes. COSA consists of the classification of Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Sources of Sewer Funds
Rate Revenue Under Prevailing Rates1 $ 4,824,937 $ 4,940,178 $ 5,042,690 $ 5,128,416 $ 5,215,599 $ 5,304,264 $ 5,394,436 Additional Revenue from Rate Increases2
- - 630,336 1,923,156 3,077,203 4,141,569 4,755,735
Total: Rate Revenue 4,824,937 4,940,178 5,673,026 7,051,572 8,292,802 9,445,833 10,150,172 Interest Earnings 28,277 166,693 120,000 22,911 22,211 24,657 21,576 Total: Sources of Funds $ 4,853,213 $ 5,106,871 $ 5,793,026 $ 7,074,483 $ 8,315,013 $ 9,470,491 $10,171,748 Uses of Sewer Funds
Operating Expenses $ 5,819,790 $ 2,105,714 $ 6,260,396 $ 6,503,425 $ 6,723,889 $ 9,410,800 $ 7,188,544 Rate-Funded Capital Expenses 345,549 3,201,161 2,573,447 197,942 1,111,368 14,992 2,230,867 Total: Use of Funds $ 6,165,340 $ 5,306,875 $ 8,833,843 $ 6,701,367 $ 7,835,256 $ 9,425,791 $ 9,419,410 Projected Increases in Rate Revenue 0.00% 0.00% 25.00% 20.00% 12.00% 12.00% 0.00% Cumulative Rate Increases 0.00% 0.00% 25.00% 50.00% 68.00% 88.16% 88.16% Net Revenue Requirement3 $ 7,169,511 $ 5,175,276 $ 8,830,324 $ 6,802,043 $ 7,935,240 $ 9,536,723 $ 9,541,748

1. Revenue and expenses for FY 2021/22 and FY 2022/23 provided by the City. Source files: 1 - Budget - Wastewater.xlsx, 2022.03.08 Revenue Budget FY 2021-22 Midyear.xlsx & REV EXP ACTUALS - FY22 and FY23_NBS .

2. Revenue from rate increases assumes an implementation date of January 1, 2024. For each year thereafter, the assumption is that new rates will be implemented on Ja nua ry 1s t of e a ch ye a r.

3. Total Use of Funds less non-rate revenues and interest earnings. This is the annual amount needed from sewer rates.

Summary of Sources and Uses of Funds
and Net Revenue Requirements
5-Year Projected Rate Period Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Unrestricted Reserves
Operating Reserve
Ending Balance $ 1,455,000 $ 2,627,989 $ 1,677,226 $ 1,626,000 $ 1,805,087 $ 1,579,529 $ 1,797,000 Recommended Minimum Target 1,455,000 526,000 1,565,000 1,626,000 1,681,000 2,353,000 1,797,000 Capital Rehabilitation & Replacement Reserve
Ending Balance $ 5,016,223 $ 5,049,669 $ 882,962 $ 1,047,302 $ 1,088,664 $ 1,088,664 $ 1,341,869 Recommended Minimum Target 759,000 852,000 936,000 968,000 1,060,000 1,156,000 1,255,000 Total Ending Balance $ 6,471,223 $ 7,677,658 $ 2,560,188 $ 2,673,302 $ 2,893,751 $ 2,668,194 $ 3,138,869 Total Recommended Minimum Target $ 2,214,000 $ 1,378,000 $ 2,501,000 $ 2,594,000 $ 2,741,000 $ 3,509,000 $ 3,052,000 Beginning Reserve Fund Balances and 5-Year Projected Rate Period Recommended Reserve Targets
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expenses and then the allocation of those expenses to customer classes based on allocation factors, such as water consumption and number of equivalent dwelling units (EDUs), or accounts. Ultimately, a COSA is intended to result in rates that are proportional to the cost of providing service to each customer class.

CLASSIFICATION OF COSTS
As previously noted, costs are classified into the following categories: (1) flow-related costs; (2) strengthrelated costs (BOD and TSS); and (3) customer-related costs. Most costs are typically allocated to more than one of these categories. The City’s budgeted costs were reviewed and allocated to these basic categories which serve as the basis for calculating the fixed and variable charges. Tables in Appendix C show how the City’s expenses were classified and allocated to these cost-causation components.

Based on the City’s projected costs, the COSA resulted in a distribution that is approximately 45% fixed and 55% variable. Currently, the City’s rate structure collects 100% of the rate revenue from fixed charges for residential customers and either fixed or variable rates for commercial customers, depending on which is greater.

Figure 33 summarizes the allocation of the net revenue requirements to each cost causation component for the proposed rate structure. More detail on the development of the allocation factors that resulted in this summary will be covered in the following section.

Figure 33. Allocation of Revenue Requirements by Customer Class

CHARACTERISTICS OF CUSTOMERS BY CLASS
Customer classes are determined by combining customers with similar demand characteristics and types of use into categories that reflect the cost differentials to serve each type of customer. The most recent water consumption data was used to estimate the amount of flow that each customer class sends to the City’s Water Reclamation Facility (WRF). Volumetric rates for all customer classes were based on the average winter water consumption for the three lowest months of use.15 For non-residential customers that do not 15 Lowest consecutive winter months are January through March 2021.

Volume BOD TSS Customer
Net Revenue Requirements 1 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 $ 6,303,363 --

55.3% 20.9% 20.9% 2.9% 100.0%
Residential Customers
Single Family Residential $ 2,337,493 $ 878,986 $ 876,669 $ 142,186 $ 4,235,335 67.2% Multi-Family Residential 400,385 150,560 150,163 38,188 739,296 11.7% All Other Customers
Commercial $ 324,130 $ 208,946 $ 208,395 $ 5,343 $ 746,815 11.8% Industrial
Hess Collection Winery $ 24,149 $ 1,207 $ 620 $ 30 $ 26,006 0.4% AmCan Beverage (Coca-Cola) 302,695 55,832 52,026 30 410,583 6.5% Mezzetta Processing Facility 98,322 19,659 27,316 30 145,327 2.3% Total: $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 $ 6,303,363 100%

1. Revenue requirement for each customer class is determined by multiplying the revenue requirement from each cost classification by the allocation factors for each customer class.
% of COS
Net Revenue
Reqts.

Customer Class
Cost Classification Components Cost-ofService Net
Revenue
85 Enterprise Rate Study – City of American Canyon
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have typical (i.e., residential) effluent strengths, volumetric rates reflect both their estimated flow and the appropriate non-residential effluent strengths.

Figure 34 shows the development of the flow (or volume) allocation factors by customer class calculated by taking the lowest consecutive 3-month water usage for FY 2020/21 and annualizing the usage per customer class.

Figure 34. Development of the Flow Allocation Factor
Determining Customer Class Effluent Strengths
Effluent strength factors for each customer class were estimated by using the Revenue Program Guidelines16 issued by the State Water Resources Control Board (SWRCB) as described below:
• Residential customers were assigned BOD and TSS strength factors of 175 mg/l which is within the normal range for residential users.
• Commercial customers were assigned BOD and TSS strength factors of 300 mg/l.

Figure 35 summarizes the development of the customer allocation factor.

Figure 35. Development of the Customer Allocation Factor 16 Revenue Program Guidelines: Commercial User Strength Characteristics, State Water Resources Control Board, Appendix G, page G-21. Site: https://www.waterboards.ca.gov/publications_forms/publications/general/docs/srf_wastewater_facilities _b.pdf.

Customer Class1 Flow
MGD
BOD
mg/l
TSS
mg/l
BOD
lbs/day
TSS
lbs/day
Flow
MG
BOD
mg/l2
BOD
lbs
% of
Total
BOD
TSS
mg/l2
TSS
lbs
% of
Total TSS
Residential Customers
Single Family Residential 0.97 175 175 1,409 1,409 352 n/a 514,224 69.4% n/a 514,224 69.8% Multi-Family Residential 0.17 175 175 241 241 60 n/a 88,080 11.9% n/a 88,080 12.0% All Other Customers
Commercial 0.13 300 300 335 335 49 n/a 122,237 16.5% n/a 122,237 16.6% Industrial3
Hess Collection Winery 0.01 50 30 4 2 3.64 8.6 260 0.0% 2.3 70 0.0% AmCan Beverage (Coca-Cola) 0.13 200 220 209 229 45.63 23.1 8,782 1.2% 5.3 1,998 0.3% Mezzetta Processing Facility 0.04 150 220 51 74 14.82 61.7 7,631 1.0% 81.2 10,035 1.4% Total: 1.44 2,248 2,291 526 741,214 100.0% 736,644 100.0%

1. Customer data provided by the City for FY 2021/22. Source file: FY 2021-22 Summary by Rate Code - Detailed v2.xlsx .

2. Annual volume and strength factors provided by the City. Source file: SIU 2 year data.xlsx .

3. Flow for industrial customer is based on wastewater flow. Strength factors are based on input from City staff and lower than expected due to customers' pretreatment process.

Source file: INF-001 & SIU Flow.xlsx .

Design Capacity Total Annual Volume
Customer Class
Number of
Dwelling Units
/ Accounts1
Percent
of Total
Residential Customers
Single Family Residential 4,710 76.5%
Multi-Family Residential 1,265 20.6%
All Other Customers
Commercial 177 2.9%
Industrial
Hess Collection Winery 1 0.0%
AmCan Beverage (Coca-Cola) 1 0.0%
Mezzetta Processing Facility 1 0.0%
Total: 6,155 100.0%

1. SFR, MFR, and Industrial customers are based on the number of dwelling units and all other customers are based on the number of accounts. 86 Enterprise Rate Study – City of American Canyon
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4.4 Rate Design Analysis
The process of evaluating the sewer rate structure provides the opportunity to incorporate a number of rate-design objectives and policies, including revenue stability, equity among customer classes, and water conservation. The overall objective is to improve the fairness and equity of the rate design and ensure costs were being appropriately collected from each customer class. During the course of the study, NBS discussed several sewer rate alternatives and methodologies with City staff, such as the percentage of revenue collected from fixed vs. variable charges and differentiating rates by customer class. The proposed rates were developed based on input provided by City staff and the City Council.

FIXED CHARGES
The fixed charge recognizes that the sewer utility incurs fixed costs regardless of whether customers send any wastewater into the City’s collection system. There are three factors used to develop the fixed charge:
1) the number of dwelling units for residential customers; 2) the number of accounts for non-residential customers; and 3) the annual revenue requirement. The monthly fixed charge is calculated by taking the 45% fixed charge multiplied by the annual revenue requirement which is then divided by the number of dwelling units for residential customers and accounts for commercial customers and billing periods per year.

VARIABLE RATES
The variable rates, on the other hand, are calculated by taking the remaining 55% portion of the net revenue requirement in each customer class and dividing it by the estimated effluent volume produced based on annualized average winter water use for both residential and non-residential customer classes.

The proposed sewer rates in this study were developed with the goal of developing a new rate structure that consists of both a fixed and variable rate component based on the number of dwelling units or accounts (for customer-related costs) and the water consumption for all customer classes. Figure 36 compares the current and proposed rates for FY 2023/24 through FY 2027/28 by customer class. Projected rates for future years, with implementation date of April 1 in Year and then January 1 each year thereafter.

These rates reflect adjustments based on the following factors: 1) the cost-of-service analysis, 2) the 45% fixed and 55% variable rate design structure; and 3) the recommended annual percentage increases in rate revenue. More detailed tables on the development of the proposed rates are documented in Appendix C. 87 Enterprise Rate Study – City of American Canyon
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Figure 36. Current vs. Proposed Sewer Rates

4.5 Comparison of Current and Proposed Sewer Bills
The following figures compare monthly sewer bills under current and proposed rates for various customers over the 5-year rate period.

Figure 37. Single Family Sewer Bill Comparison
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

25.00% 20.00% 12.00% 12.00% 0.00%
Residential - Monthly Fixed Service Charges
Single Family Residential Per Dwelling Unit $60.48 $74.94 $89.93 $100.72 $112.81 $112.81 Multi-Family Residential Per Dwelling Unit $45.36 $48.70 $58.44 $65.45 $73.31 $73.31 Commercial Customers 3
Monthly Fixed Service Charge Per Account $60.48 $115.21 $138.25 $154.84 $173.42 $173.42 Volumetric Rate Per HCF $5.40 $1.92 $2.31 $2.58 $2.89 $2.89 Industrial Customers
Monthly Fixed Administrative Charge Per Account n/a $2.52 $3.02 $3.38 $3.79 $3.79 Fixed Charges
Flow - per HCF per day Per HCF per day Sewage Flow n/a $517 $620 $695 $778 $778 BOD - per pound per day Per pound per day n/a $221 $266 $297 $333 $333 TSS - per pound per day Per pound per day n/a $217 $261 $292 $327 $327 Sewer Use Charges
Flow - per HCF Per HCF Sewage Flow n/a $3.54 $4.24 $4.75 $5.32 $5.32 BOD - per pound Per pound n/a $1.10 $1.32 $1.48 $1.66 $1.66 TSS - pound Per pound n/a $1.11 $1.33 $1.49 $1.67 $1.67

1. Sewer rates are set according to the average monthly water use for January to March of the previous calendar year. New customers are charged at the average winter water use rate (standard) and adjusted the following year if applicable.

2. The fixed charge includes a monthly customer charge per account.

3. Current rates for commercial customers are charged the higher of the fixed or variable rate. Proposed rates have both a fixed and volumetric charge per commercial customer.

Proposed Sewer Rates Current
Rates Sewer Rate Schedule1,2 Description
88 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 32
Figure 38. Multi-Family Residential Sewer Bill Comparison Figure 39. Commercial Sewer Bill Comparison
89 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 33

5. Recommendations and Next Steps

5.1 Consultant Recommendations
NBS recommends the City take the following actions:
• Approve and Accept this Study: NBS recommends the City Council formally approve and adopt this Study and its recommendations and proceed with the next steps outlined below to implement the proposed rates. This will provide documentation of the rate study analyses and the basis for analyzing potential changes to future rates. • Implement Recommended Levels of Rate Increases and Proposed Rates: Based on successfully meeting the Proposition 218 procedural requirements, the City should proceed with implementing the 5-year schedule of proposed rates (including drought rates) and rate increases previously shown in Figure 18, Figure 19, Figure 20, Figure 25, Figure30, and Figure

36. This will help ensure the continued financial health of City’s utilities.

5.2 Next Steps
Annually Review Rates and Revenue – Any time an agency adopts new utility rates or rate structures, those new rates should be closely monitored over the next several years to ensure the revenue generated is sufficient to meet the annual revenue requirements. Changing economic and water consumption patterns underscore the need for this review, as well as potential and unseen changing revenue requirements— particularly those related to environmental regulations that can significantly affect capital improvements and repair and replacement costs.

Note: The attached Technical Appendices provide more detailed information on the analysis of the financial plan, revenue requirements, cost-of-service, and the rate design analyses that have been summarized in this report.

5.3 NBS’ Principal Assumptions and Considerations
In preparing this report and the opinions and recommendations included herein, NBS has relied on a number of principal assumptions and considerations with regard to financial matters, conditions, and events that may occur in the future. This information and these assumptions, including the City’s budgets, capital improvement costs, customer accounts and consumption, and information from City staff were provided by sources we believe to be reliable, although NBS has not independently verified this data.

While we believe NBS’ use of such information and assumptions is reasonable for the purpose of this report and its recommendations, some assumptions will invariably not materialize as stated herein and may vary significantly due to unanticipated events and circumstances. Therefore, the actual results can be expected to vary from those projected to the extent that actual future conditions differ from those assumed by us or provided to us by others.
90 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 34
Technical Appendices
91 Enterprise Rate Study – City of American Canyon
Prepared by NBS – March 2024 35
Appendix A. Water Rate Study Tables and Figures
92 CITY OF AMERICAN CANYON Financial Plan & Reserve Summary

WATER RATE STUDY
Financial Plan and Reserve Projections
TABLE 1 : FINANCIAL PLAN AND SUMMARY OF REVENUE REQUIREMENTS Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Sources of Water Funds
Rate Revenue: 1
Water Sales - Meter Use Fees $ 8,362,554 $ 8,485,676 $ 9,360,200 $ 9,528,684 $ 9,690,671 $ 9,855,413 $ 10,022,955 $ 10,193,345 $ 10,366,632 $ 10,532,498 $ 10,701,018 $ 10,872,234 Water Sales - Metered Water 47,619 58,508 81,440 82,906 84,315 85,749 87,206 88,689 90,197 91,640 93,106 94,596 Non-Rate Revenue:

Grant - State/Local $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Interest Earnings2 (212,625) 215,995 275,008 87,285 61,319 56,589 58,325 60,169 56,736 48,854 37,654 23,863 Miscellaneous Revenues 570,024 319,827 359,300 365,767 371,985 378,309 384,740 391,281 397,933 404,300 410,769 417,341 Late Penalties / Interest 93,977 128,487 114,300 116,357 118,335 120,347 122,393 124,474 126,590 128,615 130,673 132,764 Interfund Transfer In (Loan Repayment) - - 44,061 44,061 49,482 49,482 49,482 49,482 49,482 49,482 49,482 49,482 Total Sources of Funds $ 8,861,548 $ 9,208,492 $ 10,234,309 $ 10,225,060 $ 10,376,108 $ 10,545,889 $ 10,725,101 $ 10,907,439 $ 11,087,569 $ 11,255,388 $ 11,422,701 $ 11,590,279 Uses of Water Funds
Operating Expenses: 1
Water Operations:
560 - Water Treatment Plant $ 1,483,133 $ 1,788,187 $ 2,088,189 $ 3,357,121 $ 2,228,382 $ 2,302,054 $ 2,378,221 $ 2,456,970 $ 2,538,391 $ 2,622,580 $ 2,709,633 $ 2,799,651 565 - Water Distribution 991,284 1,013,187 1,536,149 1,586,987 1,639,520 1,693,803 1,749,895 1,807,858 1,867,753 1,929,647 1,993,606 2,059,700 50 - Public Works 1,356,080 1,616,039 366,768 378,613 390,854 403,506 416,582 430,096 444,064 458,500 473,420 488,842 Water Purchases 3,380,850 4,035,407 3,602,218 3,674,262 3,747,748 3,822,703 3,899,157 3,977,140 4,056,683 4,137,816 4,220,573 4,304,984 Subtotal: Water Supply & Distribution: Expenses: $ 7,211,347 $ 8,452,821 $ 7,593,324 $ 8,996,983 $ 8,006,504 $ 8,222,065 $ 8,443,854 $ 8,672,063 $ 8,906,891 $ 9,148,543 $ 9,397,232 $ 9,653,176 Non-Operating Expenses: 3
Transfer To General Fund 1,263,894 1,798,674 2,206,123 2,207,963 2,171,674 2,237,313 2,304,938 2,374,610 2,446,390 2,520,343 2,596,533 2,675,030 Subtotal: Non-Operating Expenses: $ 1,263,894 $ 1,798,674 $ 2,206,123 $ 2,207,963 $ 2,171,674 $ 2,237,313 $ 2,304,938 $ 2,374,610 $ 2,446,390 $ 2,520,343 $ 2,596,533 $ 2,675,030 Other Expenditures:

Existing Debt Service $ 523,735 $ 744,109 $ 820,140 $ 823,637 $ 1,468,278 $ 2,523,408 $ 3,014,261 $ 3,269,396 $ 3,287,122 $ 3,227,021 $ 3,128,082 $ 103,586 New Debt Service - - - - - - - - - - - -
Rate-Funded Capital Expenses 251,795 2,790,541 4,566,877 1,523,075 1,565,040 754,328 665,707 952,128 1,201,396 1,421,386 1,618,317 1,797,260 Subtotal: Other Expenditures $ 775,530 $ 3,534,650 $ 5,387,017 $ 2,346,712 $ 3,033,319 $ 3,277,736 $ 3,679,968 $ 4,221,524 $ 4,488,517 $ 4,648,407 $ 4,746,399 $ 1,900,846 Total Uses of Water Funds $ 9,250,771 $ 13,786,145 $ 15,186,464 $ 13,551,658 $ 13,211,497 $ 13,737,114 $ 14,428,761 $ 15,268,197 $ 15,841,798 $ 16,317,293 $ 16,740,164 $ 14,229,052 plus: Revenue from Rate Increases4 - - 212,437 1,336,492 2,361,290 3,190,413 3,710,759 3,981,564 4,049,251 4,114,039 4,179,863 4,246,741 Annual Surplus/(Deficit) $ (389,223) $ (4,577,653) $ (4,739,718) $ (1,990,107) $ (474,099) $ (813) $ 7,099 $ (379,194) $ (704,979) $ (947,866) $ (1,137,600) $ 1,607,968 Net Revenue Req't. (Total Uses less Non-Rate Revenue) $ 8,799,395 $ 13,121,837 $ 14,393,795 $ 12,938,188 $ 12,610,375 $ 13,132,387 $ 13,813,821 $ 14,642,792 $ 15,211,058 $ 15,686,042 $ 16,111,587 $ 13,605,603 Total Rate Revenue After Rate Increases $ 8,410,172 $ 8,544,184 $ 10,291,388 $ 11,419,530 $ 12,658,891 $ 13,389,056 $ 14,025,170 $ 14,263,598 $ 14,506,079 $ 14,738,176 $ 14,973,987 $ 15,213,571 Projected Annual Rate Revenue Increase 0.00% 0.00% 9.00% 9.00% 9.00% 4.00% 3.00% 0.00% 0.00% 0.00% 0.00% 0.00% Cumulative Increase from Annual Revenue Increases 0.00% 0.00% 9.00% 18.81% 29.50% 34.68% 38.72% 38.72% 38.72% 38.72% 38.72% 38.72% Debt Coverage After Rate Increase N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

1. Revenue and expenses for FY 2021/22 through FY 2023/24 provided by the City. Revenues and expenses for all other years are escalated based on the forecasting assumptions located in Table 10. Source files: Fund 510 Water Operations.xlsx , FY2023-24 Exp Budget Water.xlsx , and Fund 510 - 580 FY 23-24 Budget Status as of 09-19-2023.xlsx .

2. Interest earnings for FY 2021/22 and FY 2022/23 are from the City's Budget. For all other years, it is calculated based on historical LAIF returns.

3. These expenses are from source file: 1 - Budget - Water.xlsx .

RATE REVENUE REQUIREMENTS SUMMARY
5-Year Projected Rate Period Projected
Prepared by NBS
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WATER RATE STUDY
Financial Plan and Reserve Projections
1 <-- Select Financial Plan Scenario Here
Financial Plan Alternatives FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 1 Alternative 1 - Full Cost Recovery Rate Increases1

0.00% 0.00% 9.00% 9.00% 9.00% 4.00% 3.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2 Alternative 2 - Phased-in Rate Increases2

0.00% 0.00% 7.00% 7.00% 7.00% 7.00% 6.00% 0.00% 0.00% 0.00% 0.00% 0.00% 3 Alternative 3 - Minimal Rate Increases3

0.00% 0.00% 5.00% 5.00% 5.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 4 Alternative 4 - No Rate Increases 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

1. Alternative 1: Scenario 1 - Rates needed to meet all revenue requirements and meet the target reserve levels (Large increase followed by smaller increases).

2. Alternative 2: Scenario 2 - Large increases phased In over two years, followed by smaller increases (Reserves drop below target level).

3. Alternative 3: Scenario 3 - Smaller increases (Reserves drop below target level).

TABLE 2 : RESERVE FUND SUMMARY
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Unrestricted Reserve:

Total Beginning Cash1 $ 3,670,141 $ 13,667,530 $ 10,874,673 Operating Reserve
Beginning Reserve Balance $ 3,634,570 $ 13,667,530 $ 10,874,673 $ 4,142,536 $ 2,278,487 $ 1,930,446 $ 2,055,691 $ 2,188,848 $ 1,935,712 $ 1,356,792 $ 534,984 $ (476,558) Plus: Net Cash Flow (After Rate Increases) (389,223) (4,577,653) (4,739,718) (1,990,107) (474,099) (813) 7,099 (379,194) (704,979) (947,866) (1,137,600) 1,607,968 Plus: Transfer in of Debt Reserve Surplus - - - - - - - - - - - - Plus: Transfer in from Capital and Infrastructure Reserve - - - - - - - - - - - - Plus: Transfer in from Capacity Fee Reserve (Interfund Loan) - 126,058 126,058 126,058 126,058 126,058 126,058 126,058 126,058 126,058 126,058 - Less: Transfer out to Capital and Infrastructure Reserve - (3,488,438) (2,118,478) - - - - - - - - - Ending Operating Reserve Balance $ 3,245,347 $ 5,727,496 $ 4,142,536 $ 2,278,487 $ 1,930,446 $ 2,055,691 $ 2,188,848 $ 1,935,712 $ 1,356,792 $ 534,984 $ (476,558) $ 1,131,410 Target Ending Balance (90-days of O&M) 2 $ 1,803,000 $ 2,113,000 $ 1,898,000 $ 2,249,000 $ 2,002,000 $ 2,056,000 $ 2,111,000 $ 2,168,000 $ 2,227,000 $ 2,287,000 $ 2,349,000 $ 2,413,000 Capital Rehabilitation & Replacement Reserve
Beginning Reserve Balance $ 35,571 $ - $ - $ 2,118,478 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 Plus: Grant Proceeds - - - - - - - - - - - -
Plus: Transfer of Operating Reserve Surplus - 3,488,438 2,118,478 - - - - - - - - - Less: Transfer out to Operating Reserve - - - - - - - - - - - - Less: Use of Reserves for Capital Projects - - - (38,578) - - - - - - - - Ending Capital and Infrastructure Reserve Balance $ 35,571 $ 3,488,438 $ 2,118,478 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 $ 2,079,900 Target Ending Balance (3% of net assets) 3 $ 1,420,700 $ 1,548,600 $ 1,870,900 $ 2,079,900 $ 2,260,500 $ 2,370,700 $ 2,458,100 $ 2,548,200 $ 2,641,000 $ 2,736,700 $ 2,835,300 $ 2,937,000 Ending Balance - Excl. Restricted Reserves $ 3,280,918 $ 9,215,935 $ 6,261,013 $ 4,358,387 $ 4,010,346 $ 4,135,591 $ 4,268,748 $ 4,015,612 $ 3,436,692 $ 2,614,884 $ 1,603,342 $ 3,211,310 Min. Target Ending Balance -Excl. Restricted Reserves $ 3,223,700 $ 3,661,600 $ 3,768,900 $ 4,328,900 $ 4,262,500 $ 4,426,700 $ 4,569,100 $ 4,716,200 $ 4,868,000 $ 5,023,700 $ 5,184,300 $ 5,350,000 Ending Surplus/(Deficit) Compared to Reserve Targets $ 57,218 $ 5,554,335 $ 2,492,113 $ 29,487 $ (252,154) $ (291,109) $ (300,352) $ (700,588) $ (1,431,308) $ (2,408,816) $ (3,580,958) $ (2,138,690)

1. Beginning cash balances provided by City staff for Fund 510 - Water Operations. Source files: 4 - Current Cash and Fund Balance - Water 12062021.xlsx & Beg Fund Balance FY23- Water.xls .

2. The target ending balance is set equal to 90-days of O&M expenses. Source file: 4 - Current Cash and Fund Balance - Water 12062021.xlsx .

3. The target ending balance is set equal to 3% of net capital assets. See Exhibit 2 (CIP) for details. 5-Year Projected Rate Period

SUMMARY OF CASH ACTIVITY
Projected
Prepared by NBS
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WATER RATE STUDY
Financial Plan and Reserve Projections
TABLE 3 : RESERVE FUND SUMMARY, cont.

Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Restricted Reserve: 1
Capacity Fee Reserve
Beginning Reserve Balance $5,688,050 $6,284,390 $6,333,173 $ 6,397,366 $ 11,290,006 $ 9,761,564 $ 8,534,556 $ 7,552,200 $ 6,768,455 $ 6,145,989 $ 5,653,746 $ 5,267,306 Plus: Interest Earnings 77,699 157,110 158,329 87,388 154,221 133,343 116,582 103,163 92,457 83,954 77,230 71,951 Plus: Capacity Fee Revenue 1,252,878 332,954 1,662,778 7,785,325 915,300 930,860 946,685 962,778 979,146 994,812 1,010,729 1,026,901 Less: Transfer out to Operating Reserve (Interfund Loan) - (126,058) (126,058) (126,058) (126,058) (126,058) (126,058) (126,058) (126,058) (126,058) (126,058) - Less: Use of Reserves for Capital Projects - - (1,630,856) (2,854,016) (2,471,905) (2,165,153) (1,919,564) (1,723,628) (1,568,012) (1,444,951) (1,348,341) (1,273,232) Ending Connection Fee Fund Balance $ 7,018,626 $ 6,648,395 $ 6,397,366 $ 11,290,006 $ 9,761,564 $ 8,534,556 $ 7,552,200 $ 6,768,455 $ 6,145,989 $ 5,653,746 $ 5,267,306 $ 5,092,926 Target Ending Balance (3% of net assets) 3 $ 1,420,700 $ 1,548,600 $ 1,870,900 $ 2,079,900 $ 2,260,500 $ 2,370,700 $ 2,458,100 $ 2,548,200 $ 2,641,000 $ 2,736,700 $ 2,835,300 $ 2,937,000 Debt Reserve
Beginning Reserve Balance $ 1,151,405 $ 122,586 $ 125,651 $ 128,792 $ 130,551 $ 132,335 $ 134,142 $ 135,975 $ 137,832 $ 139,715 $ 141,623 $ 143,558 Plus: Reserve Funding from New Debt Obligations - - - - - - - - - - - - Plus: Interest Earnings 15,728 3,065 3,141 1,759 1,783 1,808 1,832 1,857 1,883 1,909 1,935 1,961 Less: Transfer of Surplus to Operating Reserve - - - - - - - - - - - - Ending Debt Reserve Balance $ 1,167,133 $ 125,651 $ 128,792 $ 130,551 $ 132,335 $ 134,142 $ 135,975 $ 137,832 $ 139,715 $ 141,623 $ 143,558 $ 145,519 Target Ending Balance $ 71,827 $ 72,068 $ 72,053 $ 71,580 $ 70,175 $ 66,417 $ 53,204 $ - $ - $ - $ - $ - Annual Interest Earnings Rate 2 1.37% 2.50% 2.50% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37%

1. The beginning cash balances provided by the City. Source file: 4 - Current Cash and Fund Balance - Water 12062021.xlsx , Beg Fund Balance FY23- Water.xls, & Beg Fund Balance FY23- Recycled Water.xls .

2. The target ending balance is set equal to 3% of net capital assets. See Exhibit 2 (CIP) for details.

3. Historical interest earning rates are per the average annual yields for funds invested in LAIF (2017-2021). The source is the California State Treasurer's website: https://www.treasurer.ca.gov/pmia-laif/historical/annual.asp .

SUMMARY OF CASH ACTIVITY
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 Financial Plan, Page 3 of 45 95 CITY OF AMERICAN CANYON Charts & Tables

WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 1
$ mil.
$3 mil.
$5 mil.
$8 mil.
$10 mil.
$13 mil.
$15 mil.
$18 mil.
$20 mil.
2022 2023 2024 2025 2026 2027 2028
Annual Obligations
Fiscal Year Ending June 30
Water Revenue Requirements vs.

Revenue Under Existing and Increased Rates
Cash Funded Capital Expenses
Debt Service
O&M Expenses
Revenues under Existing Rates
Revenues under Increased Rates
Prepared by NBS
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WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 2
$.0 Mil.
$2.0 Mil.
$4.0 Mil.
$6.0 Mil.
$8.0 Mil.
$10.0 Mil.
$12.0 Mil.
2022 2023 2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Ending Cash Balances vs.

Recommended Reserve Targets
Ending Cash Balance (Unrestricted Reserves) Minimum Target Reserve Balance Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 Charts and Tables, 5 of 45 97 CITY OF AMERICAN CANYON Charts & Tables

WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 3

9.0% 9.0% 9.0%

4.0%

3.0%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Projected Increases to Rate Revenue
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 Charts and Tables, 6 of 45 98 CITY OF AMERICAN CANYON Charts & Tables

WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 4
$6.2 Mil
$4.4 Mil
$4.0 Mil
$2.9 Mil
$2.6 Mil
$2.7 Mil
$2.8 Mil
$2.9 Mil
$3.0 Mil
$3.1 Mil
$.0 Mil.
$1.0 Mil.
$2.0 Mil.
$3.0 Mil.
$4.0 Mil.
$5.0 Mil.
$6.0 Mil.
$7.0 Mil.
$8.0 Mil.
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
City of American Canyon
Capital Improvement Projects
5-Year Project Rate Period
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 Charts and Tables, 7 of 45 99 CITY OF AMERICAN CANYON Exhibit 1 - O&M

WATER RATE STUDY
Operating Revenue and Expenses
TABLE 4 : REVENUE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Rate Revenue
Water Service Charge - Potable 1 $ 8,362,554 $ 8,485,676 $ 9,360,200 $ 9,528,684 $ 9,690,671 $ 9,855,413 $ 10,022,955 $ 10,193,345 $ 10,366,632 $ 10,532,498 $ 10,701,018 $ 10,872,234 Water Service Charge - Raw 1 47,619 58,508 81,440 82,906 84,315 85,749 87,206 88,689 90,197 91,640 93,106 94,596 Other Revenue
Grant - State/Local 1 - - - - - - - - - - - -
Interest Earnings See FP (212,625) 215,995 - - - - - - - - - - Charges for Services 9 329,720 - - - - - - - - - - -
Miscellaneous Revenues 1 240,304 319,827 359,300 365,767 371,985 378,309 384,740 391,281 397,933 404,300 410,769 417,341 Late Penalties / Interest 1 93,977 128,487 114,300 116,357 118,335 120,347 122,393 124,474 126,590 128,615 130,673 132,764 Insurance Reimbursements 9 - - - - - - - - - - - -
Fund Transfer In
Interfund Transfer In (Loan Repayment) 9 - - 44,061 44,061 49,482 49,482 49,482 49,482 49,482 49,482 49,482 49,482 Capacity Fee Revenue
Water Capacity Fees 1 1,252,878 332,954 1,662,778 7,785,325 915,300 930,860 946,685 962,778 979,146 994,812 1,010,729 1,026,901 Interest Earnings 1 114,219 282,378 50,000 50,900 51,765 52,645 53,540 54,450 55,376 56,262 57,162 58,077 TOTAL: REVENUE $ 10,228,645 $ 9,823,824 $ 11,672,079 $ 17,974,001 $ 11,281,855 $ 11,472,805 $ 11,667,002 $ 11,864,499 $ 12,065,355 $ 12,257,609 $ 12,452,939 $ 12,651,394 TABLE 5 : REVENUE SUMMARY
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Rate Revenue
Water Service Charge - Potable $ 8,362,554 $ 8,485,676 $ 9,360,200 $ 9,528,684 $ 9,690,671 $ 9,855,413 $ 10,022,955 $ 10,193,345 $ 10,366,632 $ 10,532,498 $ 10,701,018 $ 10,872,234 Water Service Charge - Raw 47,619 58,508 81,440 82,906 84,315 85,749 87,206 88,689 90,197 91,640 93,106 94,596 Other Revenue
Grant - State/Local - - - - - - - - - - - -
Interest Earnings (212,625) 215,995 - - - - - - - - - - Miscellaneous Revenues 570,024 319,827 359,300 365,767 371,985 378,309 384,740 391,281 397,933 404,300 410,769 417,341 Late Penalties / Interest 93,977 128,487 114,300 116,357 118,335 120,347 122,393 124,474 126,590 128,615 130,673 132,764 Interfund Transfer In (Loan Repayment) - - 44,061 44,061 49,482 49,482 49,482 49,482 49,482 49,482 49,482 49,482 Capacity Fee Revenue
Water Capacity Fees 1,252,878 332,954 1,662,778 7,785,325 915,300 930,860 946,685 962,778 979,146 994,812 1,010,729 1,026,901 Interest Earnings 114,219 282,378 50,000 50,900 51,765 52,645 53,540 54,450 55,376 56,262 57,162 58,077 TOTAL: REVENUE $ 10,228,645 $ 9,823,824 $ 11,672,079 $ 17,974,001 $ 11,281,855 $ 11,472,805 $ 11,667,002 $ 11,864,499 $ 12,065,355 $ 12,257,609 $ 12,452,939 $ 12,651,394 Projected
5-Year Projected Rate Period Projected
Basis DESCRIPTION
DESCRIPTION Basis
5-Year Projected Rate Period
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 1 (O&M), 8 of 45 100 CITY OF AMERICAN CANYON Exhibit 1 - O&M

WATER RATE STUDY
Operating Revenue and Expenses
TABLE 6 : OPERATING EXPENSE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Fund 510 - Water Operations
560 - Water Treatment Plant
Wages - Full time 3 $ 419,960 $ 552,331 $ 612,238 $ 633,667 $ 655,845 $ 678,800 $ 702,558 $ 727,147 $ 752,597 $ 778,938 $ 806,201 $ 834,418 Wages - Overtime 3 10,703 14,204 9,000 9,315 9,641 9,978 10,328 10,689 11,063 11,451 11,851 12,266 Health Insurance 3 73,246 91,247 95,546 98,890 102,351 105,933 109,641 113,478 117,450 121,561 125,815 130,219 Health-In-Lieu 3 - - 9,690 10,029 10,380 10,743 11,119 11,509 11,911 12,328 12,760 13,206 Cafeteria Plan Section 125 3 15,149 19,673 24,587 25,448 26,338 27,260 28,214 29,202 30,224 31,282 32,377 33,510 Social Security & Medicare 3 6,835 8,573 9,374 9,703 10,042 10,394 10,757 11,134 11,524 11,927 12,344 12,776 Worker Comp Insurance 3 32,904 36,686 49,859 51,604 53,410 55,280 57,215 59,217 61,290 63,435 65,655 67,953 Benefits - Other 3 1,125 1,705 1,106 1,145 1,185 1,226 1,269 1,314 1,360 1,407 1,457 1,508 Info Tech Support Services 2 40,818 2,424 116,200 119,686 123,277 126,975 130,784 134,708 138,749 142,911 147,199 151,615 Professional Services 2 132,912 128,160 366,400 377,392 388,714 400,375 412,386 424,758 437,501 450,626 464,145 478,069 Temp Agency Services 2 - 1,066 - - - - - - - - - -
Misc Contractual Services 2 4,962 66,347 59,200 60,976 62,805 64,689 66,630 68,629 70,688 72,809 74,993 77,243 General Repairs & Maint 2 220,338 114,331 53,800 55,414 57,076 58,789 60,552 62,369 64,240 66,167 68,152 70,197 Advertising 2 4,908 1,279 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829 Postage/Mail/Copy/Printing Svc 2 8,482 3,887 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610 Membership Dues & Subscription 2 2,430 1,369 3,200 3,296 3,395 3,497 3,602 3,710 3,821 3,936 4,054 4,175 Conferences - Training 2 8,946 15,126 13,500 13,905 14,322 14,752 15,194 15,650 16,120 16,603 17,101 17,614 Rentals - Equipment/Space 2 4,305 9,134 3,700 3,811 3,925 4,043 4,164 4,289 4,418 4,551 4,687 4,828 Regulatory Compliance Permits 2 29,461 205 - - - - - - - - - - Office Supplies 2 2,929 2,645 25,000 25,750 26,523 27,318 28,138 28,982 29,851 30,747 31,669 32,619 Operating Supplies 2 347,712 406,005 488,400 503,052 518,144 533,688 549,699 566,189 583,175 600,670 618,691 637,251 Water Plant Membrane Filters 2 - - - 1,200,000 - - - - - - - - Utilities - Gas & Elec 5 61,656 61,456 73,000 77,116 81,465 86,059 90,912 96,038 101,454 107,175 113,218 119,603 Util-PhonesPgrsInternetCable 2 5,422 6,589 5,800 5,974 6,153 6,338 6,528 6,724 6,926 7,133 7,347 7,568 Major Equipment 2 15,000 152,253 - - - - - - - - - -
Capital Outlay-Contra Account 9 (40,761) - - - - - - - - - - - PERS Retirement 3 73,689 91,491 60,588 62,708 64,903 67,175 69,526 71,959 74,478 77,085 79,783 82,575 Subtotal - Water Treatment Plant $ 1,483,133 $ 1,788,187 $ 2,088,189 $ 3,357,121 $ 2,228,382 $ 2,302,054 $ 2,378,221 $ 2,456,970 $ 2,538,391 $ 2,622,580 $ 2,709,633 $ 2,799,651 DESCRIPTION Basis
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 1 (O&M), 9 of 45 101 CITY OF AMERICAN CANYON Exhibit 1 - O&M

WATER RATE STUDY
Operating Revenue and Expenses
TABLE 7 : OPERATING EXPENSE FORECAST, cont.1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 565 - Water Distribution
Wages - Full time 3 $ 426,369 $ 436,850 $ 544,808 $ 563,876 $ 583,612 $ 604,038 $ 625,180 $ 647,061 $ 669,708 $ 693,148 $ 717,408 $ 742,517 Wages - Overtime 3 24,335 14,875 3,000 3,105 3,214 3,326 3,443 3,563 3,688 3,817 3,950 4,089 Health Insurance 3 43,356 53,367 110,792 114,670 118,683 122,837 127,137 131,586 136,192 140,959 145,892 150,998 Health-In-Lieu 3 14,200 11,400 - - - - - - - - - -
Cafeteria Plan Section 125 3 21,165 21,467 27,459 28,420 29,415 30,444 31,510 32,613 33,754 34,936 36,158 37,424 Social Security & Medicare 3 7,057 7,005 8,298 8,588 8,889 9,200 9,522 9,855 10,200 10,557 10,927 11,309 Worker Comp Insurance 3 44,905 37,930 58,411 60,455 62,571 64,761 67,028 69,374 71,802 74,315 76,916 79,608 Benefits - Other 3 1,354 7,974 1,901 1,968 2,036 2,108 2,182 2,258 2,337 2,419 2,503 2,591 Info Tech Support Services 2 5,422 31,462 84,600 87,138 89,752 92,445 95,218 98,075 101,017 104,047 107,169 110,384 Professional Services 2 932 10,305 52,000 53,560 55,167 56,822 58,526 60,282 62,091 63,953 65,872 67,848 Misc Contractual Services 2 6,051 3,952 9,300 9,579 9,866 10,162 10,467 10,781 11,105 11,438 11,781 12,134 General Repairs & Maint 2 177,364 86,880 375,100 386,353 397,944 409,882 422,178 434,844 447,889 461,326 475,165 489,420 Reimbursable Repairs 2 - - 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 Postage/Mail/Copy/Printing Svc 2 - 224 3,499 3,604 3,712 3,823 3,938 4,056 4,178 4,303 4,432 4,565 Membership Dues & Subscription 2 1,312 390 3,200 3,296 3,395 3,497 3,602 3,710 3,821 3,936 4,054 4,175 Conferences - Training 2 8,755 3,806 7,000 7,210 7,426 7,649 7,879 8,115 8,358 8,609 8,867 9,133 Rentals - Equipment/Space 2 5,206 4,996 13,000 13,390 13,792 14,205 14,632 15,071 15,523 15,988 16,468 16,962 Office Supplies 2 1,660 4,778 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610 Operating Supplies 2 15,671 37,392 33,200 34,196 35,222 36,279 37,367 38,488 39,643 40,832 42,057 43,318 Water Meters 7 98,208 104,845 100,000 103,500 107,123 110,872 114,752 118,769 122,926 127,228 131,681 136,290 Util-PhonesPgrsInternetCable 5 3,960 4,825 4,100 4,331 4,575 4,833 5,106 5,394 5,698 6,019 6,359 6,717 Major Equipment 2 15,000 54,531 - - - - - - - - - -
PERS Retirement 3 69,004 73,933 74,481 77,088 79,786 82,578 85,468 88,460 91,556 94,760 98,077 101,510 Subtotal -Water Distribution $ 991,284 $ 1,013,187 $ 1,536,149 $ 1,586,987 $ 1,639,520 $ 1,693,803 $ 1,749,895 $ 1,807,858 $ 1,867,753 $ 1,929,647 $ 1,993,606 $ 2,059,700 DESCRIPTION Basis
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 1 (O&M), 10 of 45 102 CITY OF AMERICAN CANYON Exhibit 1 - O&M

WATER RATE STUDY
Operating Revenue and Expenses
TABLE 8 : OPERATING EXPENSE FORECAST, cont.1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 50 - Public Works
810 - Non Departmental
Wages - Full time 3 $ 113,357 $ 136,471 $ 128,293 $ 132,783 $ 137,430 $ 142,240 $ 147,219 $ 152,371 $ 157,704 $ 163,224 $ 168,937 $ 174,850 Wages - Overtime 3 954 178 - - - - - - - - - -
Allowances 3 1,811 1,920 1,920 1,987 2,057 2,129 2,203 2,280 2,360 2,443 2,528 2,617 Health Insurance 3 18,856 20,841 21,244 21,987 22,757 23,553 24,378 25,231 26,114 27,028 27,974 28,953 Cafeteria Plan Section 125 3 4,227 4,452 4,312 4,463 4,619 4,781 4,948 5,122 5,301 5,486 5,678 5,877 Social Security & Medicare 3 1,747 2,069 2,038 2,109 2,183 2,259 2,338 2,420 2,505 2,592 2,683 2,777 Worker Comp Insurance 3 7,901 7,096 9,825 10,169 10,525 10,893 11,274 11,669 12,077 12,500 12,937 13,390 OPEB 3 80,835 (8,807) 47,537 49,201 50,923 52,705 54,550 56,459 58,435 60,480 62,597 64,788 Pension Expense 3 (223,456) 37,354 - - - - - - - - - -
Benefits - Other 3 1,371 1,421 - - - - - - - - - -
Info Tech Support Services 2 - - 33,414 34,416 35,449 36,512 37,608 38,736 39,898 41,095 42,328 43,598 Professional Services 2 42,173 47,333 66,586 68,584 70,641 72,760 74,943 77,191 79,507 81,892 84,349 86,880 Postage/Mail/Copy/Printing Svc 2 - 9,000 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829 Bad Debt Expense 2 (11,826) 14,649 - - - - - - - - - -
Membership Dues & Subscription 2 425 767 2,600 2,678 2,758 2,841 2,926 3,014 3,105 3,198 3,294 3,392 Regulatory Compliance Permits 2 - - - - - - - - - - - - Services - Cash for Grass 2 17,463 8,815 30,000 30,900 31,827 32,782 33,765 34,778 35,822 36,896 38,003 39,143 Services - Toilet Rebates 9 5,300 5,800 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 Services - Washer Rebates 2 - - - - - - - - - - - -
Office Supplies 2 - - 500 515 530 546 563 580 597 615 633 652 Operating Supplies 2 750 637 - - - - - - - - - -
Utilities - Water 5 2,155 2,563 2,500 2,641 2,790 2,947 3,113 3,289 3,474 3,670 3,877 4,096 City of Napa 8 178,426 305,944 278,000 283,560 289,231 295,016 300,916 306,934 313,073 319,335 325,721 332,236 North Bay Aqueduct 8 2,142,501 2,330,665 3,203,000 3,267,060 3,332,401 3,399,049 3,467,030 3,536,371 3,607,098 3,679,240 3,752,825 3,827,881 City of Vallejo 8 1,059,922 1,398,799 121,218 123,642 126,115 128,638 131,210 133,834 136,511 139,241 142,026 144,867 AC Recycled Water 2 10,000 49,405 - - - - - - - - - -
Depreciation 2 1,282,037 1,274,074 - - - - - - - - - -
Transfer to Gen Fund Support Sv 2 766,412 942,449 1,124,203 1,157,929 1,192,667 1,228,447 1,265,300 1,303,259 1,342,357 1,382,628 1,424,107 1,466,830 Transfer To General Fund - Oth 9 57,195 319,586 160,000 100,000 - - - - - - - - Retiree Health Benefits 3 60,100 53,849 74,980 77,605 80,321 83,132 86,042 89,053 92,170 95,396 98,735 102,191 PERS Retirement 3 17,037 18,820 16,257 16,826 17,415 18,024 18,655 19,308 19,984 20,683 21,407 22,156 ISF - Bldg Maint 2 77,400 218,948 325,219 334,976 345,025 355,376 366,037 377,018 388,328 399,978 411,978 424,337 ISF - Fleet 2 238,950 178,624 354,173 364,798 375,742 387,014 398,625 410,584 422,901 435,588 448,656 462,115 ISF - Info Tech 2 18,000 44,795 54,709 56,350 58,041 59,782 61,575 63,423 65,325 67,285 69,304 71,383 ISF - Legal Services 2 28,800 21,603 96,582 99,479 102,464 105,538 108,704 111,965 115,324 118,784 122,347 126,018 Subtotal - Non Departmental $ 6,000,824 $ 7,450,121 $ 6,175,109 $ 6,260,838 $ 6,310,276 $ 6,463,522 $ 6,620,677 $ 6,781,846 $ 6,947,136 $ 7,116,658 $ 7,290,526 $ 7,468,856 TOTAL: WATER OPERATIONS EXPENSES $ 8,475,241 $ 10,251,496 $ 9,799,447 $ 11,204,947 $ 10,178,178 $ 10,459,378 $ 10,748,792 $ 11,046,673 $ 11,353,281 $ 11,668,886 $ 11,993,765 $ 12,328,206 TABLE 9 : OPERATING EXPENSE FORECAST, cont.1(for information only) Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33

CAPITAL PROJECTS
Intra-fund Transfer Out Water 7 $ 89,642 $ 85,675 $ 2,038,185 $ 2,109,521 $ 2,183,355 $ 2,259,772 $ 2,338,864 $ 2,420,724 $ 2,505,450 $ 2,593,141 $ 2,683,900 $ 2,777,837 Intra-fund Transfer Out Recycled 7 - - 120,000 124,200 128,547 133,046 137,703 142,522 147,511 152,674 158,017 163,548 Misc. Contractual Services (Dept 450) 2 400,000 50,000 - - - - - - - - - - Transfer Cap Projs Fund - Gen 7 - - 596,000 616,860 638,450 660,796 683,924 707,861 732,636 758,278 784,818 812,287 Transfer Cap Proj - Water 7 - - - - - - - - - - - -
Transfer Cap Proj - Wastewater 7 (155,893) 412,280 250,000 258,750 267,806 277,179 286,881 296,922 307,314 318,070 329,202 340,724 Transfer Cap Proj - Recycled 7 - - 917,509 949,622 982,859 1,017,259 1,052,863 1,089,713 1,127,853 1,167,328 1,208,185 1,250,471 Subtotal - Capital Projects $ 333,749 $ 547,955 $ 3,921,694 $ 4,058,954 $ 4,201,017 $ 4,348,053 $ 4,500,235 $ 4,657,743 $ 4,820,764 $ 4,989,490 $ 5,164,123 $ 5,344,867 DESCRIPTION Basis
DESCRIPTION Basis
5-Year Projected Rate Period Projected
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 1 (O&M), 11 of 45 103 CITY OF AMERICAN CANYON Exhibit 1 - O&M

WATER RATE STUDY
Operating Revenue and Expenses
TABLE 10 : FORECASTING ASSUMPTIONS
Basis 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Customer Growth31 -- 1.80% 1.80% 1.80% 1.70% 1.70% 1.70% 1.70% 1.70% 1.60% 1.60% 1.60% General Cost Inflation42 -- 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Labor Cost Inflation53 -- 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Energy64 -- 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% Electricty75 -- 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% Fuel & Utilities86 -- 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% Construction Cost Inflation97 -- 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Water Purchases10 8 -- 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% No Escalation 9 -- 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

1. Revenue and expenses for FY 2021/22 through FY 2023/24 provided by the City. Revenues and expenses for all other years are escalated based on the forecasting assumptions located in Table 10. Source files: Fund 510 Water Operations.xlsx , FY 22 Fund 520 Water Cap Revenue Detailed Trial Balance , FY 23 Fund 520 Water Cap Revenue Detailed Trial Balance, & REV EXP ACTUALS - FY22 and FY23_NBS.

2. Expenses are inflated each year by the following annual inflation factor categories.

3. Customer growth is based on service area population growth through FY 2039/40. Source file: American Canyon 2015 UWMP.pdf , page 26.

4. General cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

5. Labor cost inflation is based on the 5-year average annual change in the Quarterly Census of Employment and Wages for San Francisco County, CA.

6. Energy cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

7. Electricity cost inflation is based on the 5-year average change in the Consumer Price Index for San Francisco County.

8. Fuel & Utilities cost inflation is based on the 5-year average annual change in the Consumer Price Index - Average Price Data for Fuels and related products and power. This factor is used for utility costs other than electricity.

9. Construction cost Inflation is the 10-year average change in the Construction Cost Index for 2012-2022. Source: Engineering News Record website (http://enr.construction.com ).

10. Water purchases growth is estimated at 2% annually. Source file: Water cost projections.xlsx .

INFLATION FACTORS2
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 1 (O&M), 12 of 45 104 CITY OF AMERICAN CANYON Exhibit 2 - CIP

WATER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 11 : CAPITAL FUNDING SUMMARY
CAPITAL FUNDING FORECAST Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Grants $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Use of Capacity Fee Reserves - - 1,630,856 2,854,016 2,471,905 2,165,153 1,919,564 1,723,628 1,568,012 1,444,951 1,348,341 1,273,232 SRF Loan Funding - - - - - - - - - - - -
Use of New Revenue Bond Proceeds - - - - - - - - - - - - Use of Capital Rehabilitation and Replacement Reserve - - - 38,578 - - - - - - - - Rate Revenue 251,795 2,790,541 4,566,877 1,523,075 1,565,040 754,328 665,707 952,128 1,201,396 1,421,386 1,618,317 1,797,260 Total Sources of Capital Funds $ 251,795 $ 2,790,541 $ 6,197,733 $ 4,415,669 $ 4,036,946 $ 2,919,481 $ 2,585,271 $ 2,675,756 $ 2,769,407 $ 2,866,337 $ 2,966,658 $ 3,070,492 Uses of Capital Funds:

Total Project Costs $ 251,795 $ 2,790,541 $ 6,197,733 $ 4,415,669 $ 4,036,946 $ 2,919,481 $ 2,585,271 $ 2,675,756 $ 2,769,407 $ 2,866,337 $ 2,966,658 $ 3,070,492 Capital Funding Surplus (Deficiency) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

CAPITAL IMPROVEMENT PROGRAM FUNDING OPTIONS
Capital Improvement Program Funding Choice FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Effective Annual Funding Amount $ 251,795 $ 2,790,541 $ 6,197,733 $ 4,415,669 $ 4,036,946 $ 2,919,481 $ 2,585,271 $ 2,675,756 $ 2,769,407 $ 2,866,337 $ 2,966,658 $ 3,070,492 5-Year Projected Rate Period Projected
Funding Sources:

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 2 (CIP), 13 of 45 105 CITY OF AMERICAN CANYON Exhibit 2 - CIP

WATER RATE STUDY
Capital Improvement Plan Expenditures

CAPITAL IMPROVEMENT PROGRAM
TABLE 12 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Current-Year Dollars ) 1 Project No. Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects 2
TR23-0100 Knightsbridge Rehab and Water Main Replacement $ - $ - $ 505,000 $ - $ - $ - $ - $ - $ - $ - $ - $ - TR24-0300 ARPA Rancho Del Mar Paving and Utility Improvements - - 1,162,000 - - - - - - - - - WW16‐0300 SCADA - 250,000 - - - - - - - - -
UM20‐0100 Engi Energy Services Contract Budget Expense Remaining 162,280 - - - - - - - - - - - WA24-0100 Rio Del Mar Water Main Upgrade - - 45,000 360,000 - - - - - - - - WA24-0200 North Kelly Road Water Main - - - 145,000 - - - - - - - - WA25-0100 Hanna Drive Water Main Repl. - - - - 550,000 - - - - - - - WA26-0100 Northampton Water Main Repl. - - - - - 650,000 - - - - - - NEW Water Treatment Plant Shop - - 75,000 - - - - - - - - - NEW WTP Filter Media Replacement and Underdrain Repair - - 350,000 - - - - - - - - - NEW Parks - Irrigation Controller Upgrade (RW) - - 200,000 - - - - - - - - - NEW Solids Handling at WTP - - 100,000 900,000 - - - - - - - - Master Plan Projects - Potable Water 3
W1 Zone 1 Storage $ - $ - $ 343,000 $ 343,000 $ 343,000 $ 343,000 $ - $ - $ - $ - $ - $ - W2 Annual Water Main Replacements - 1,500,000 1,455,000 995,000 950,000 850,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 W3 Annual Water Service Replacements 81,000 81,000 81,000 81,000 - - - - - - - - W4 High Pressure Zone System - 1,024,000 1,024,000 1,024,000 1,024,000 - - - - - - - W8 Replace Transmission Mains Near SR29 - - - - 196,000 196,000 196,000 196,000 196,000 196,000 196,000 196,000 W9 Replace Oat Hill Transmission Main - - - - 128,000 128,000 128,000 128,000 128,000 128,000 128,000 128,000 W11 Fire Flows in Hess Drive - - - - 79,000 79,000 79,000 79,000 79,000 79,000 79,000 79,000 W13 Main Zone Reliability Improvements - - - - 129,000 129,000 129,000 129,000 129,000 129,000 129,000 129,000 Estimated Future Projects
Future Projects4 - - - - - - - - - - - -
Total: CIP Program Costs (Future-Year Dollars) $ 243,280 $ 2,605,000 $ 5,590,000 $ 3,848,000 $ 3,399,000 $ 2,375,000 $ 2,032,000 $ 2,032,000 $ 2,032,000 $ 2,032,000 $ 2,032,000 $ 2,032,000 Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 2 (CIP), 14 of 45 106 CITY OF AMERICAN CANYON Exhibit 2 - CIP

WATER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 13 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Future-Year Dollars ) 5 Project No. Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects 2
TR23-0100 Knightsbridge Rehab and Water Main Replacement $ - $ - $ 559,903 $ - $ - $ - $ - $ - $ - $ - $ - $ - TR24-0300 ARPA Rancho Del Mar Paving and Utility Improvements - - 1,288,330 - - - - - - - - - WW16‐0300 SCADA - - 277,179 - - - - - - - - -
UM20‐0100 Engi Energy Services Contract Budget Expense Remaining 167,960 - - - - - - - - - - - WA24-0100 Rio Del Mar Water Main Upgrade - - 49,892 413,108 - - - - - - - - WA24-0200 North Kelly Road Water Main - - - 166,391 - - - - - - - - WA25-0100 Hanna Drive Water Main Repl. - - - - 653,227 - - - - - - - WA26-0100 Northampton Water Main Repl. - - - - - 799,016 - - - - - - NEW Water Treatment Plant Shop - - 83,154 - - - - - - - - - NEW WTP Filter Media Replacement and Underdrain Repair - - 388,051 - - - - - - - - - NEW Parks - Irrigation Controller Upgrade (RW) - - 221,744 - - - - - - - - - NEW Solids Handling at WTP - - 110,872 1,032,771 - - - - - - - - Master Plan Projects - Potable Water 3
W1 Zone 1 Storage $ - $ - $ 380,290 $ 393,600 $ 407,376 $ 421,635 $ - $ - $ - $ - $ - $ - W2 Annual Water Main Replacements - 1,606,838 1,613,185 1,141,785 1,128,302 1,044,867 1,908,419 1,975,214 2,044,346 2,115,898 2,189,955 2,266,603 W3 Annual Water Service Replacements 83,835 86,769 89,806 92,949 - - - - - - - - W4 High Pressure Zone System - 1,096,934 1,135,327 1,175,064 1,216,191 - - - - - - - W8 Replace Transmission Mains Near SR29 - - - - 232,787 240,934 249,367 258,095 267,128 276,477 286,154 296,169 W9 Replace Oat Hill Transmission Main - - - - 152,024 157,345 162,852 168,552 174,451 180,557 186,876 193,417 W11 Fire Flows in Hess Drive - - - - 93,827 97,111 100,510 104,028 107,669 111,437 115,338 119,374 W13 Main Zone Reliability Improvements - - - - 153,212 158,574 164,124 169,868 175,814 181,967 188,336 194,928 Estimated Future Projects
Future Projects4 - - - - - - - - - - - -
Total: CIP Program Costs (Future-Year Dollars) $ 251,795 $ 2,790,541 $ 6,197,733 $ 4,415,669 $ 4,036,946 $ 2,919,481 $ 2,585,271 $ 2,675,756 $ 2,769,407 $ 2,866,337 $ 2,966,658 $ 3,070,492 TABLE 14 : FORECASTING ASSUMPTIONS
Economic Variables FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Annual Construction Cost Inflation, Per Engineering News Record63.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Cumulative Construction Cost Multiplier from FY 2021/22 1.04 1.07 1.11 1.15 1.19 1.23 1.27 1.32 1.36 1.41 1.46 1.51

1. Capital project costs were provided by City Staff in source file: Water Projects.pdf.

2. Capital projects costs for FY 2021/22 and FY 2022/23 are from source files: 11. CIP Budget vs Expense Report FY 2021-2022 through Oct 2021.pdf & Water FY 2023-2027.xlsx .

3. The City's Water Master Plan projects were scheduled to begin in 2016; however, the study only includes costs from FY 2021/22 through FY 2034/35. Source file: 2016 Potable Water Master Plan.pdf , page 53.

4. Future project costs beyond FY 2034/35 are calculated based on the City's 10-year average.

5. Capital improvement projects are inflated to future year estimated costs with ENR CCI for the region. Source: Engineering News Record website (http://enr.construction.com ).

6. For reference purposes, the annual Construction Cost Inflation percentage is the 10-year average change in the Construction Cost Index for September 2012-2022 (3.5%). Source: Engineering News Record website (http://enr.construction.com).

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 2 (CIP), 15 of 45 107 CITY OF AMERICAN CANYON Exhibit 3 - Debt

WATER RATE STUDY
Debt Service
TABLE 15 : EXISTING DEBT OBLIGATIONS
EXISTING DEBT OBLIGATIONS Actuals Actuals
Annual Repayment Schedules: FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 SWRCB (California Department of Water Resources): Contract No. D-GLC 461 Principal Payment $ 70,382 $ 72,142 $ 73,946 $ 75,794 $ 77,689 $ 79,631 $ 53,204 $ - $ - $ - $ - $ - Interest Payment 24,084 22,324 20,521 18,672 16,777 14,835 12,844 - - - - - Subtotal: Annual Debt Service $ 94,466 $ 94,466 $ 94,466 $ 94,466 $ 94,466 $ 94,466 $ 66,048 $ - $ - $ - $ - $ - Coverage Requirement ($-Amnt above annual payment) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement2$ 71,827 $ 72,068 $ 72,053 $ 71,580 $ 70,175 $ 66,417 $ 53,204 $ - $ - $ - $ - $ - Banc of America Public Capital Corp Agreement (ENGIE) - Loan Amount $5,209,2093 Principal Payment $ 5,520 $ 66,788 $ 63,992 $ 68,673 $ 73,583 $ 75,042 $ 82,720 $ 88,430 $ 78,658 $ 84,010 $ 89,620 $ 94,771 Interest Payment 23,749 22,854 21,682 20,498 19,229 17,900 16,494 14,966 13,463 12,011 10,462 8,815 Subtotal: Annual Debt Service $ 29,269 $ 89,642 $ 85,674 $ 89,171 $ 92,812 $ 92,941 $ 99,214 $ 103,396 $ 92,122 $ 96,021 $ 100,082 $ 103,586 Coverage Requirement ($-Amnt above annual payment) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement (total fund balance) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Sites Reservoir Project - Debt Amount $20,586,0004
Principal Payment $ 400,000 $ 560,000 $ 640,000 $ 640,000 $ 1,281,000 $ 2,336,000 $ 2,849,000 $ 3,166,000 $ 3,195,000 $ 3,131,000 $ 3,028,000 $ - Interest Payment - - - - - - - - - - - -
Subtotal: Annual Debt Service $ 400,000 $ 560,000 $ 640,000 $ 640,000 $ 1,281,000 $ 2,336,000 $ 2,849,000 $ 3,166,000 $ 3,195,000 $ 3,131,000 $ 3,028,000 $ - Coverage Requirement ($-Amnt above annual payment) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement (total fund balance) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Grand Total: Existing Annual Debt Service $ 523,735 $ 744,109 $ 820,140 $ 823,637 $ 1,468,278 $ 2,523,408 $ 3,014,261 $ 3,269,396 $ 3,287,122 $ 3,227,021 $ 3,128,082 $ 103,586 Grand Total: Existing Annual Coverage Requirement $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Grand Total: Existing Debt Reserve Target $ 71,827 $ 72,068 $ 72,053 $ 71,580 $ 70,175 $ 66,417 $ 53,204 $ - $ - $ - $ - $ - 5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 3 (Debt), 16 of 45 108 CITY OF AMERICAN CANYON Exhibit 3 - Debt

WATER RATE STUDY
Debt Service
TABLE 16 : WATER UTILITY EXISTING DEBT OBLIGATIONS, cont.

EXISTING DEBT OBLIGATIONS Actuals Actuals
Annual Repayment Schedules: FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Interfund Loans (For Information Only)
Water Operations to Water Capacity Fund
Advance from Water Operations 510 to Water Capacity 520 Original Loan Amount (June 1, 2008) $ 1,000,000
Accrued Interest (LAIF Rate + 2%) 132,325
Annual Debt Service5 $126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ 126,058 $ - Water Operations to Recycled Water Fund
Advance from Water Operations 510 to Recycled Water Operations 580 Original Loan Amount (September 21, 2021) $ 128,189
Accrued Interest (LAIF Rate + 2%) 11,706
Annual Debt Service6 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 Water Operations to Recycled Water Fund
Advance from Water Operations 510 to Recycled Water Operations 580 Original Loan Amount (June 20, 2023) $ 1,136,140
Accrued Interest (LAIF Rate + 2%) 981
Annual Debt Service7 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061

1. Construction loan issued by the State under the Davis-Grunsky Act. Source files: 5 - Debt Service Schedules.xlsx & 6 - Davis Grunsky Agreement $2,050,000 Loan Dec 9 1974.pdf .

2. The City is required to maintain a debt reserve fund equal to the average annual payment of the total outstanding loan balance. Source file: 6 - Davis Grunsky Agreement $2,050,000 Loan Dec 9 1974.pdf , pp. 11-12 .

3. Equipment lease/purchase loan issued by the Banc of America Public Capital Corp to cover energy efficiency projects to City facilities. Water utility portion is 24.64%, or $1,283,549.10 (Principal). Source file: 6 - ENGIE Closing Documents.pdf .

4. Debt service for the City's portion of costs related to the Sites Reservoir Project. Source files: Email from City staff dated 9-19-2022 & Sites-2021-Draft-Plan-of-Finance.pdf , Table 6A, page 27.

5. Funds advanced to purchase water rights. Repayment scheduled to begin FY 2022/23.

6. Funds advanced for Green Island Recycled Waterline Project. Repayment scheduled to begin FY 2025/26.

7. Funds advanced for the Recycled Water Expansion Project, Project no. RW17-0100. Repayment scheduled to begin FY 2023/24.

TABLE 17 : EXISTING ANNUAL DEBT OBLIGATIONS TO BE SATISFIED BY WATER RATES Annual Obligations FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Existing Annual Debt Service $ 523,735 $ 744,109 $ 820,140 $ 823,637 $ 1,468,278 $ 2,523,408 $ 3,014,261 $ 3,269,396 $ 3,287,122 $ 3,227,021 $ 3,128,082 $ 103,586 Existing Annual Coverage Requirement $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Existing Debt Reserve Target $ 71,827 $ 72,068 $ 72,053 $ 71,580 $ 70,175 $ 66,417 $ 53,204 $ - $ - $ - $ - $ - 5-Year Projected Rate Period Projected
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www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 3 (Debt), 17 of 45 109 CITY OF AMERICAN CANYON Exhibit 4 - Currents Rates

WATER RATE STUDY
Projected Water Rates Under Existing Rate Schedule
TABLE 18 : CURRENT WATER RATE SCHEDULE
Current Rates
Jan. 1, 2023
Monthly Fixed Service Charges
Residential Use $26.56
Multi-Family, Commercial and Landscape
< 1" meter $26.56
1" meter (Residential) $26.56
1" meter (Commercial) $44.42
1 1/2" meter $88.75
2" meter $141.99
3" meter $283.98
4" meter $443.74
6" meter $887.48
8" meter $1,420.06
Private Fire Protection $13.28
Temporary Hydrant Meters $283.98
Raw Water
1" meter $44.42
2" meter $141.99
4" meter $443.74
6" meter $887.48
Variable Rates for All Water Consumed (in $/hcf) 2
Residential Use
Tier 1 (0 - 10 units) $7.54
Tier 2 (> 10 units) $8.15
Multi-Family, Commercial and Landscape $7.72
Private Fire Protection $3.86
Temporary Hydrant Meters
Potable $7.72
Recycled $0.90
Raw Water $3.44

1. Rates available on the City website. Source: https://www.cityofamericancanyon.org .

2. HCF = hundred cubic feet (748 gallons).

Water Rate Schedule1
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www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 4 (Current Rates), 18 of 45110 CITY OF AMERICAN CANYON Functionalization & Classification

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 19 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (COM) (CAP) (CA) (FP) (COM) (CAP) (CA) (FP)
Fund 510 - Water Operations
560 - Water Treatment Plant
Wages - Full Time $ 612,238 $ 306,119 $ 223,160 $ 61,224 $ 21,736 50.0% 36.4% 10.0% 3.6% Wages - Overtime 9,000 4,500 3,280 900 320 50.0% 36.4% 10.0% 3.6% Health Insurance 95,546 47,773 34,826 9,555 3,392 50.0% 36.4% 10.0% 3.6% Health-In-Lieu 9,690 4,845 3,532 969 344 50.0% 36.4% 10.0% 3.6% Cafeteria Plan Section 125 24,587 12,294 8,962 2,459 873 50.0% 36.4% 10.0% 3.6% Social Security & Medicare 9,374 4,687 3,417 937 333 50.0% 36.4% 10.0% 3.6% Worker Comp Insurance 49,859 24,930 18,174 4,986 1,770 50.0% 36.4% 10.0% 3.6% Benefits - Other 1,106 553 403 111 39 50.0% 36.4% 10.0% 3.6% Info Tech Support Services 116,200 58,100 42,355 11,620 4,125 50.0% 36.4% 10.0% 3.6% Professional Services 366,400 183,200 133,552 36,640 13,008 50.0% 36.4% 10.0% 3.6% Misc Contractual Services 59,200 29,600 21,578 5,920 2,102 50.0% 36.4% 10.0% 3.6% General Repairs & Maint 53,800 26,900 19,610 5,380 1,910 50.0% 36.4% 10.0% 3.6% Advertising 6,000 3,000 2,187 600 213 50.0% 36.4% 10.0% 3.6% Postage/Mail/Copy/Printing Svc 2,000 1,000 729 200 71 50.0% 36.4% 10.0% 3.6% Membership Dues & Subscription 3,200 1,600 1,166 320 114 50.0% 36.4% 10.0% 3.6% Conferences - Training 13,500 6,750 4,921 1,350 479 50.0% 36.4% 10.0% 3.6% Rentals - Equipment/Space 3,700 1,850 1,349 370 131 50.0% 36.4% 10.0% 3.6% Office Supplies 25,000 12,500 9,112 2,500 888 50.0% 36.4% 10.0% 3.6% Operating Supplies 488,400 244,200 178,021 48,840 17,339 50.0% 36.4% 10.0% 3.6% Water Plant Membrane Filters - - - - - 50.0% 36.4% 10.0% 3.6% Utilities - Gas & Elec 73,000 36,500 26,608 7,300 2,592 50.0% 36.4% 10.0% 3.6% Util-Phonespgrsinternetcable 5,800 2,900 2,114 580 206 50.0% 36.4% 10.0% 3.6% Pers Retirement 60,588 30,294 22,084 6,059 2,151 50.0% 36.4% 10.0% 3.6% Subtotal - Water Treatment Plant $ 2,088,189 $ 1,044,094 $ 761,140 $ 208,819 $ 74,135 50.0% 36.4% 10.0% 3.6% Fire
Protection
Capacity Customer Budget Categories
Total Revenue
Requirements
Commodity Basis of Classification
Prepared by NBS
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 20 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS, cont.

Classification of Expenses
FY 2023/24 (COM) (CAP) (CA) (FP) (COM) (CAP) (CA) (FP)
Fund 510 - Water Operations
565 - Water Distribution
Wages - Full Time $ 544,808 $ 272,404 $ 198,581 $ 54,481 $ 19,342 50.0% 36.4% 10.0% 3.6% Wages - Overtime 3,000 1,500 1,093 300 107 50.0% 36.4% 10.0% 3.6% Health Insurance 110,792 55,396 40,384 11,079 3,933 50.0% 36.4% 10.0% 3.6% Cafeteria Plan Section 125 27,459 13,730 10,009 2,746 975 50.0% 36.4% 10.0% 3.6% Social Security & Medicare 8,298 4,149 3,025 830 295 50.0% 36.4% 10.0% 3.6% Worker Comp Insurance 58,411 29,205 21,291 5,841 2,074 50.0% 36.4% 10.0% 3.6% Benefits - Other 1,901 951 693 190 67 50.0% 36.4% 10.0% 3.6% Info Tech Support Services 84,600 42,300 30,837 8,460 3,003 50.0% 36.4% 10.0% 3.6% Professional Services 52,000 26,000 18,954 5,200 1,846 50.0% 36.4% 10.0% 3.6% Misc Contractual Services 9,300 4,650 3,390 930 330 50.0% 36.4% 10.0% 3.6% General Repairs & Maint 375,100 187,550 136,723 37,510 13,317 50.0% 36.4% 10.0% 3.6% Reimbursable Repairs 20,000 10,000 7,290 2,000 710 50.0% 36.4% 10.0% 3.6% Postage/Mail/Copy/Printing Svc 3,499 1,750 1,275 350 124 50.0% 36.4% 10.0% 3.6% Membership Dues & Subscription 3,200 1,600 1,166 320 114 50.0% 36.4% 10.0% 3.6% Conferences - Training 7,000 3,500 2,551 700 249 50.0% 36.4% 10.0% 3.6% Rentals - Equipment/Space 13,000 6,500 4,738 1,300 462 50.0% 36.4% 10.0% 3.6% Office Supplies 2,000 1,000 729 200 71 50.0% 36.4% 10.0% 3.6% Operating Supplies 33,200 16,600 12,101 3,320 1,179 50.0% 36.4% 10.0% 3.6% Water Meters 100,000 50,000 36,450 10,000 3,550 50.0% 36.4% 10.0% 3.6% Util-Phonespgrsinternetcable 4,100 2,050 1,494 410 146 50.0% 36.4% 10.0% 3.6% Pers Retirement 74,481 37,240 27,148 7,448 2,644 50.0% 36.4% 10.0% 3.6% Subtotal -Water Distribution $ 1,536,149 $ 768,074 $ 559,923 $ 153,615 $ 54,537 50.0% 36.4% 10.0% 3.6% Fire
Protection
Customer Budget Categories
Total Revenue
Requirements
Commodity Capacity Basis of Classification
Prepared by NBS
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 21 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS, cont.

Classification of Expenses
FY 2023/24 (COM) (CAP) (CA) (FP) (COM) (CAP) (CA) (FP)
50 - Public Works
810 - Non Departmental
Wages - Full Time $ 128,293 $ 64,146 $ 46,762 $ 12,829 $ 4,555 50.0% 36.4% 10.0% 3.6% Allowances 1,920 960 700 192 68 50.0% 36.4% 10.0% 3.6%
Health Insurance 21,244 10,622 7,743 2,124 754 50.0% 36.4% 10.0% 3.6% Cafeteria Plan Section 125 4,312 2,156 1,572 431 153 50.0% 36.4% 10.0% 3.6% Social Security & Medicare 2,038 1,019 743 204 72 50.0% 36.4% 10.0% 3.6% Worker Comp Insurance 9,825 4,912 3,581 982 349 50.0% 36.4% 10.0% 3.6% Opeb 47,537 23,769 17,327 4,754 1,688 50.0% 36.4% 10.0% 3.6% Info Tech Support Services 33,414 16,707 12,179 3,341 1,186 50.0% 36.4% 10.0% 3.6% Professional Services 66,586 33,293 24,270 6,659 2,364 50.0% 36.4% 10.0% 3.6% Postage/Mail/Copy/Printing Svc 6,000 3,000 2,187 600 213 50.0% 36.4% 10.0% 3.6% Membership Dues & Subscription 2,600 1,300 948 260 92 50.0% 36.4% 10.0% 3.6% Services - Cash For Grass 30,000 15,000 10,935 3,000 1,065 50.0% 36.4% 10.0% 3.6% Services - Toilet Rebates 10,000 5,000 3,645 1,000 355 50.0% 36.4% 10.0% 3.6% Office Supplies 500 250 182 50 18 50.0% 36.4% 10.0% 3.6% Utilities - Water 2,500 1,250 911 250 89 50.0% 36.4% 10.0% 3.6% City Of Napa 278,000 278,000 - - - 100.0% 0.0% 0.0% 0.0% North Bay Aqueduct 3,203,000 3,203,000 - - - 100.0% 0.0% 0.0% 0.0% City Of Vallejo 121,218 121,218 - - - 100.0% 0.0% 0.0% 0.0% Transfer To Gen Fund Support Sv 1,124,203 562,102 409,770 112,420 39,912 50.0% 36.4% 10.0% 3.6% Transfer To General Fund - Oth 160,000 80,000 58,320 16,000 5,680 50.0% 36.4% 10.0% 3.6% Retiree Health Benefits 74,980 37,490 27,330 7,498 2,662 50.0% 36.4% 10.0% 3.6% Pers Retirement 16,257 8,128 5,926 1,626 577 50.0% 36.4% 10.0% 3.6% Isf - Bldg Maint 325,219 162,610 118,542 32,522 11,546 50.0% 36.4% 10.0% 3.6% Isf - Fleet 354,173 177,087 129,095 35,417 12,574 50.0% 36.4% 10.0% 3.6% Isf - Info Tech 54,709 27,355 19,941 5,471 1,942 50.0% 36.4% 10.0% 3.6% Isf - Legal Services 96,582 48,291 35,204 9,658 3,429 50.0% 36.4% 10.0% 3.6% Subtotal - Non Departmental $ 6,175,109 $ 4,888,664 $ 937,813 $ 257,289 $ 91,343 79.2% 15.2% 4.2% 1.5% Total: Water Operations Expenses $ 9,799,447 $ 6,700,833 $ 2,258,877 $ 619,723 $ 220,015 68.4% 23.1% 6.3% 2.2% TOTAL: WATER OPERATIONS EXPENSES $ 9,799,447 $ 6,700,833 $ 2,258,877 $ 619,723 $ 220,015 68.4% 23.1% 6.3% 2.2% Capacity Fire
Protection
Customer Budget Categories
Total Revenue
Requirements
Commodity Basis of Classification
Prepared by NBS
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 22 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS, cont.

Classification of Expenses, continued
FY 2023/24 (COM) (CAP) (CA) (FP) (COM) (CAP) (CA) (FP)
Debt Service Payments
Outstanding Debt $ 820,140 $ - $ 820,140 $ - $ - 0.0% 100.0% 0.0% 0.0% New Debt Issue - SRF Loan - - - - - 0.0% 100.0% 0.0% 0.0% New Debt Issue - Revenue Bond - - - - - 0.0% 100.0% 0.0% 0.0% Total Debt Service Payments $ 820,140 $ - $ 820,140 $ - $ - 0.0% 100.0% 0.0% 0.0% Capital Expenditures
Rate Funded Capital Expenses $ 4,566,877 $ - $ 4,566,877 $ - $ - 0.0% 100.0% 0.0% 0.0% TOTAL REVENUE REQUIREMENTS $ 15,186,464 $ 6,700,833 $ 7,645,894 $ 619,723 $ 220,015 44.1% 50.3% 4.1% 1.4% Less: Non-Rate Revenues
Other Revenue
Grant - State/Local $ - $ - $ - $ - $ - 44.1% 50.3% 4.1% 1.4% Interest Earnings (275,008) (121,344) (138,458) (11,222) (3,984) 44.1% 50.3% 4.1% 1.4% Miscellaneous Revenues (359,300) (158,537) (180,896) (14,662) (5,205) 44.1% 50.3% 4.1% 1.4% Late Penalties / Interest (114,300) (50,433) (57,546) (4,664) (1,656) 44.1% 50.3% 4.1% 1.4% Interfund Transfer In (Loan Repayment) (44,061) (19,441) (22,183) (1,798) (638) 44.1% 50.3% 4.1% 1.4% NET REVENUE REQUIREMENTS $ 14,393,795 $ 6,351,077 $ 7,246,811 $ 587,376 $ 208,531 Allocation of Revenue Requirements 100.0% 44.1% 50.3% 4.1% 1.4% TABLE 23 : ADJUSTMENT TO CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses, continued
Adjustments to Classification of Expenses
Adjustment for Current Rate Level: Total (COM) (CAP) (CA) (FP) Test Year (FY 2023/24) Target Rate Rev. After Rate Increases $ 10,291,388 Projected Rate Revenue at Current Rates $ 9,441,640
Test Year (FY 2023/24) Projected Rate Adjustment 9.00%
Adjusted Net Revenue Req'ts $ 10,291,388 $ 4,540,943 $ 5,181,381 $ 419,967 $ 149,097 Percent of Revenue 100.0% 44.1% 50.3% 4.1% 1.4%
TABLE 24 : NET REVENUE REQUIREMENTS PER COSA RESULTS
SWP Raw Water
Treated
Water
Capacity
Related Costs
Customer
Related Costs
Fire
Protection
Related Costs
Rate-Design Adjustments to Fixed/Variable % 100.0% 50.3% 4.1% 1.4% Rate-Design Adjustments to Fixed/Variable ($) $10,291,388 $3,702,785 $515,708 $322,450 $5,181,381 $419,967 $149,097 TABLE 25 : NET REVENUE REQUIREMENTS PER COSA RESULTS - ALTERNATIVE 1 (COSA) Rate-Design Adjustments to Fixed/Variable % 100.0% 36.0% 2.9% 1.0% Rate-Design Adjustments to Fixed/Variable ($) $10,291,388 $5,035,095 $701,267 $438,471 $3,709,181 $300,640 $106,734

60.0%
Total Rate
Revenue
Requirements
FY 2023/24
(Excluding
Recycled Water)
Commodity Capacity
Commodity Related Costs

44.1%
Fire
Protection
Customer
Net Revenue Requirements - Per COSA Results
56% Fixed / 44% Variable
Fixed Costs
Budget Categories
Total Revenue
Requirements Basis of Classification
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 26 : DEVELOPMENT OF THE COMMODITY ALLOCATION FACTOR Development of the Volumetric/Variable Allocation Factor1 Customer Class
FY 2021/22
Consumption
(hcf)
% Adjustment for
Conservation2
Est. FY 2021/22
Volume Adjusted
for Conservation
FY 2021/22
% of Total
Volume
Residential 507,339 20.0% 405,871 50.1%
Multi-Family 89,630 20.0% 71,704 8.8%
Commercial 318,808 20.0% 255,046 31.5%
Landscape 53,157 20.0% 42,526 5.2%
Private Fire Protection 22,831 20.0% 18,265 2.3%
Temporary Hydrant Meters 8,303 20.0% 6,642 0.8%
Raw Water 13,039 20.0% 10,431 1.3%
Total 1,013,107 810,486 100%

1. Consumption data is based on the City of American Canyon's billing data.

2. A conservation factor of 20% included in table above based on the "20 by 2020" law passed in 2009.

Source: https://www.ca-ilg.org .

Commodity Related Costs: Costs associated with the
total consumption (flow) of water over a specified period of time (e.g. annual).

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Allocation Factors, 23 of 45115 CITY OF AMERICAN CANYON Allocation Factors

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 27 : DEVELOPMENT OF THE CAPACITY ALLOCATION FACTORS Development of the CAPACITY Allocation Factors
Customer Class Meter Size1 No. of Meters
Hydraulic
Capacity Factors2
Total
Equivalent
Meters
% of EDUs
Residential 4,880 4,930 42.2%
< 1" meter 1,986 1.00 1,986
1" meter 2,875 1.00 2,875
1 1/2" meter 7 2.00 14
2" meter 9 3.20 29
3" meter 1 6.40 6
4" meter 2 10.00 20
Multi-Family 556 5,598 47.9%
1 1/2" meter 20 2.00 40
2" meter 201 3.20 643
3" meter 96 6.40 614
4" meter 48 10.00 480
6" meter 191 20.00 3,820
Commercial 343 698 6.0%
< 1" meter 102 1.00 102
1" meter 88 1.00 88
1 1/2" meter 54 2.00 108
2" meter 81 3.20 259
3" meter 11 6.40 70
4" meter 7 10.00 70
Landscape 73 122 1.0%
< 1" meter 13 1.00 13
1" meter 30 1.00 30
1 1/2" meter 14 2.00 28
2" meter 16 3.20 51
Private Fire Protection 245 245 2.1%
< 1" meter 245 1.00 245
Temporary Hydrant Meters 8 51 0.4%
3" meter 8 6.40 51
Raw Water 3 40 0.3%
4" meter 2 10.00 20
6" meter 1 20.00 20
Total 6,108 11,684 100%

1. Meter by class and size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

Capacity Related Costs: Costs associated with the
maximum demand required at one point in time or the
maximum size of facilities required to meet this demand.

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Allocation Factors, 24 of 45116 CITY OF AMERICAN CANYON Allocation Factors

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 28 : DEVELOPMENT OF THE CUSTOMER ALLOCATION FACTORS Development of the Customer Allocation Factor
Customer Class
No. of
Meters/Account
s FY
2021/221
% of Total Meters
Residential 4,880 71.5%
Multi-Family21,273 18.7%
Commercial 343 5.0%
Landscape 73 1.1%
Private Fire Protection 245 3.6%
Temporary Hydrant Meters 8 0.1%
Raw Water 3 0.0%
Total 6,825 100.0%

1. Meter count data is based on the City's billing data for June 2022.

2. Multi-family residential customers are by dwelling units.

Customer Related Costs: Costs associated with having a
customer on the water system. These costs vary with the addition or deletion of customers on the system.

Examples: Meter-reading, Postage and billing.

Prepared by NBS
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 29 : FY 2023/24 WATER SUPPLY BY SOURCE
In AF In HCF
SWP (Contracted Purchase) 3,590 1,563,804 81.5% $ 2,727,590 75.7% Vallejo Raw Water (Contracted Purchase) 500 217,800 11.4% 138,033 3.8% Treated Water (Contracted Purchase)1 313 136,181 7.1% 737,049 20.5% Totals 4,403 1,917,785 100.0% $ 3,602,672 100%

1. This includes Vallejo Treated Water and City of Napa Treat and Wheel. Source files: Water cost projections.xlsx .

TABLE 30 : UNIT COSTS BY SOURCE OF SUPPLY
Source of Supply Quantity (AF) Total Cost Rate ($/AF)
SWP (Tier 1) 3,590 $ 2,727,590 $ 760
Vallejo Raw Water (Tier 1) 500 138,033 $ 276
Treated Water (Tier 2) 313 737,049 $ 2,358
Total Water Supply (AF) 4,403 $ 3,602,672
Unit Costs ($/HCF) Quantity (HCF) Total Cost Rate ($/HCF) Tier 1 - SWP & Vallejo Raw Water 1,781,604 $ 1,129,112 $ 0.63 Tier 2 - Treated Water (Napa & Vallejo) 136,181 737,049 $ 5.41 Blended Cost (all water) per hcf $ 1.88
Total Estimated Quantity (hcf) 1,917,785 $ 1,866,161 810,486 Estimated Residential Consumption 405,871
Total FY 2023/24 % of Total Volume 50.1%
Source of Supply
Total Contracted Purchases Acre Feet as a
% of Total
Total Cost
(FY 2023/24)
Cost as a % of
Total Cost
Vallejo Raw
Water in AF
500
SWP in AF 3,590
Treated Water
Contracted in AF
313
0 500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
In AF
FY 2023/24 Source of Supply in
Acre Feet and % of Total

53.7%

69.9%

25.6%
Tier 1
Tier 2

49.9%

4.5%
Tier 2 - 7.1%
Tier 1 - Vallejo Raw
Water 11.4%
Tier 1 - SWP

81.5%
0%
20%
40%
60%
80%
100%
Source of Supply
Tier 1 - SWP Tier 1 - Vallejo Raw Water Tier 2 - Treated Water Prepared by NBS
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 31 : ALLOCATION OF WATER REVENUE REQUIREMENTS
Commodity-Related Costs $ 6,174,833 60.0%
Capacity-Related Costs 3,709,181 36.0%
Customer-Related Costs 300,640 2.9%
Fire Protection-Related Costs 106,734 1.0%
Net Revenue Requirement $ 10,291,388 100.0%

60.0% total variable

40.0% total fixed
100.0%
`
TABLE 32 : ALLOCATION OF UNADJUSTED NET REVENUE REQUIREMENTS - FY 2023/24 Net Revenue Requirements (COSA)

VARIABLE
$6,174,833
Cost of Service
Net Rev. Req'ts
$10,291,388
% of COS Net
Capacity- Revenue Req'ts
Related Costs
Classification Components
CustomerRelated CostsFire ProtectionRelated CostsCommodityRelated Costs FIXED
Classification Components

PROPOSED ALTERNATIVE
(40% Fixed / 60% Variable)
Cost-of-Service Net Revenue
Requirements (FY 2023/24)
Unadjusted Net Rev. Req'ts.

Customer Classes
Total Net Revenue Requirement
by Classification Component $4,116,555
FIXED
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 33 : COST-OF-SERVICE SUMMARY OF REVENUE REQUIREMENTS Residential $ 4,872,326 47.3%
Multi-Family 2,379,400 23.1%
Commercial 2,179,689 21.2%
Landscape 365,999 3.6%
Private Fire Protection 334,458 3.2%
Temporary Hydrant Meters 67,213 0.7%
Raw Water 92,303 0.9%
Total $ 10,291,388 100%
TABLE 34 : METER EQUIVALENCY FACTORS USED IN FIXED CHARGES CALCULATION 5/8 inch 20 1.00
3/4 inch 30 1.00
1 inch 50 1.00
1 1/2 inch 100 2.00
2 inch 160 3.20
3 inch 320 6.40
4 inch 500 10.00
6 inch 1,000 20.00
8 inch 1,600 32.00
10 inch 4,200 84.00
12 inch 5,300 106.00

1. Per AWWA, M1 Manual, Table B-1.

Compound Class I Meters
Turbine Class II Meters
Meter Capacity
(gpm)1
Meter Size Equivalency
to 1 inch
Displacement Meters
Standard Meters
Customer Class FY 2023/24 COS
Rev. Req't
Proposed Alternative
Allocated Costs
% of COS
Rev. Req't.

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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 35 : CALCULATION OF MONTHLY FIXED METER SERVICE CHARGES FOR FY 2023/24 ALTERNATIVE 1 (COSA)
< 1" meter 1" meter 1 1/2" meter 2" meter 3" meter 4" meter 6" meter 8" meter Residential 1,986 2,875 7 9 1 2 0 0 4,880
Multi-Family 0 0 20 201 96 48 191 0 556
Commercial 13 30 14 16 0 0 0 0 73
Commercial 102 88 54 81 11 7 0 0 343
Private Fire Protection 245 0 0 0 0 0 0 0 245
Temporary Hydrant Meters 0 0 0 0 8 0 0 0 8
Raw Water 0 0 0 0 0 2 1 0 3
Total Meters/Accounts 2,346 2,993 95 307 116 59 192 0 6,108 Hydraulic Capacity Factor 21.00 1.00 2.00 3.20 6.40 10.00 20.00 32.00 Total Equivalent Meters 2,346 2,993 190 982 742 590 3,840 0 11,684 Monthly Fixed Service Charges
Customer Costs ($/Acct/month)3
$4.10 $4.10 $4.10 $4.10 $4.10 $4.10 $4.10 $4.10
Capacity Costs ($/Acct/month)4$27.22 $27.22 $54.43 $87.09 $174.19 $272.17 $544.33 $870.93 Total Monthly Meter Charge $31.32 $31.32 $58.53 $91.19 $178.29 $276.27 $548.43 $875.03 Annual Fixed Costs Allocated to Monthly Meter Charges
Customer Costs $ 300,640
Capacity Costs 3,815,915
Total Fixed Meter Costs $ 4,116,555
Annual Revenue from Monthly Meter Charges
Customer Charges $ 115,491 $ 147,298 $ 4,676 $ 15,111 $ 5,710 $ 2,904 $ 9,450 $ - $ 300,640 Capacity Charges $ 766,330 $ 977,381 $ 62,054 $ 320,851 $ 242,467 $ 192,693 $ 1,254,139 $ - $ 3,815,915 Total Revenue from Monthly Meter Charges $ 881,821 $ 1,124,680 $ 66,730 $ 335,961 $ 248,177 $ 195,597 $ 1,263,590 $ - $ 4,116,555

1. Meter by Class and Size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

3. Customer costs are allocated to each customer by dividing the total customer costs by the total number of customers.

4. Capacity costs are allocated by meter size and the hydraulic capacity of the meter.

Number of Meters by Class and Size Total 1 FY 2023/24
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 36 : FIXED CHARGES REVENUE CHECK
< 1" 1" 1 1/2" 2" 3" 4" 6" 8"
Potable Water
Residential 1,986 2,875 7 9 1 2 0 0 4,880
Multi-Family 0 0 20 201 96 48 191 0 556
Commercial 102 88 54 81 11 7 0 0 343
Landscape 13 30 14 16 0 0 0 0 73
Private Fire 245 0 0 0 0 0 0 0 245
Temp Meter 0 0 0 0 8 0 0 0 8
Raw Water 0 0 0 0 0 2 1 0 3
Recycled Water
Recycled Water 2 13 14 28 13 6 0 0 76
Total Meters/Accounts 2,348 3,006 109 335 129 65 192 0 6,184 TABLE 37 : PROJECTED FIXED REVENUE CHECK
< 1" 1" 1 1/2" 2" 3" 4" 6" 8"
All Customers by Meter Size $31.32 $31.32 $58.53 $91.19 $178.29 $276.27 $548.43 $875.03 Revenue from Fixed Charges
Potable Water
Residential $ 746,526 $ 1,080,333 $ 4,917 $ 9,849 $ 2,139 $ 6,630 $ - $ - $ 1,850,395 Multi-Family - - 14,048 219,962 205,387 159,130 1,257,008 - 1,855,536 Commercial 38,334 33,072 37,931 88,641 23,534 23,206 - - 244,718 Landscape 4,886 11,275 9,834 17,509 - - - - 43,503
Private Fire 92,076 - - - - - - - 92,076
Temp Meter - - - - 17,116 - - - 17,116
Raw Water - - - - - 6,630 6,581 - 13,212
Total Revenue - Fixed Charges $ 4,116,555
TABLE 38 : PROJECTED FIXED REVENUE CHECK
`
Potable Water
Residential $ 1,780,122 $ 1,850,395 $ 70,272
Multi-Family 1,833,110 1,855,536 22,426
Commercial 236,572 244,718 8,146
Landscape 42,010 43,503 1,494
Private Fire 195,304 92,076 (103,229)
Temp Meter 16,607 17,116 509
Raw Water 12,831 13,212 381
Total $ 4,116,555 $ 4,116,555 $ -
Customer Class
Net Revenue Requirements (COSA)
COS
Rev. Req't
Expected
Revenue
Over/(Under)
Collected
Number of Meters by Class and Size Total
Projected Revenue From Fixed Charges
by Customer Class
FY 2023/24
FY 2023/24
Net Revenue Requirements (COSA)
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 39 : PROPOSED VOLUMETRIC CHARGES FOR FY 2023/24
Net Revenue Requirements (COSA)
Customer Classes
Number of
Meters1
Water
Consumption
(hcf/yr)2
Total Target
Rev. Req't from
Vol. Charges
% of Total Rate
Revenue
Uniform
Commodity
Rates ($/hcf)
Proposed Rate
Structure
Residential 4,880 405,871 $ 3,092,204 50.1% n/a 2 Tiers Multi-Family 1,273 71,704 546,290 8.8% $7.619 Uniform
Commercial 343 255,046 1,943,118 31.5% $7.619 Uniform
Landscape 73 42,526 323,989 5.2% $7.619 Uniform
Private Fire Protection 245 18,265 139,154 2.3% $7.619 Uniform Temporary Hydrant Meters 8 6,642 50,606 0.8% $7.619 Uniform Raw Water 3 10,431 79,472 1.3% $7.619 Uniform
Total Potable Water 6,825 810,486 $ 6,174,833 100%

1. Consumption data is based on the City of American Canyon's billing data.

2. Water consumption is actual consumption for FY 2021/22 and includes an adjustment of 20% for conservation. See Table 26.

TABLE 40 : RESIDENTIAL & MOBILE HOME TIER BREAK ADJUSTMENTS Tier 1 - SWP & Vallejo Raw Water 322,836 79.5%
Tier 2 - Treated Water (Napa & Vallejo) 83,035 20.5%
Total 405,871 100.0% 7.0

1. SWP & Vallejo raw water are included in Tier 1 and all treated water (Napa & Vallejo) is in Tier 2. The FY 2021/22 consumption data are actuals and includes a 20% conservation factor. See Allocation Factors Tab, Table 26.

2. See Source of Supply Tab for details on how the percentage of consumption was calculated.

3. Annual residential consumption divided by total residential meters divided by 12 months.

4. Tier 2 breakpoint is the percentage of Tier 1 consumption times the Avg. Monthly Consumption , rounded to the nearest integer in hcf.

TABLE 41 : ALLOCATION OF SOURCE OF SUPPLY COSTS TO SINGLE FAMILY TIERED RATES Source of Supply
Water Supply by
Source (hcf)1
% Alloc. by
Class2 Cost ($/hcf)3 Total Supply
Costs
Residential
Share of Supply
Residential 892,183 50.1% $0.63 $ 565,431 $ 565,431
All Other Classes 889,421 49.9% $0.63 563,680 N.A.
1,781,604 100.0% N.A. $ 1,129,112 N.A.

Residential 68,196 50.1% $5.41 $ 369,096 $ 369,096
All Other Classes 67,985 49.9% $5.41 367,953 N.A.
136,181 100.0% N.A. $ 737,049 N.A.

Grand Total 1,917,785 $ 1,866,161 $ 934,527

1. Total Contracted Supply Purchase Costs are from the Source of Supply Tab, Table 29.

2. Residential consumption for FY 2021/22 is from the Allocation Factors Tab, Table 26.

3. Contracted Supply Costs are from the Source of Supply Tab, Table 30. % of
Consumption2
Consumption
Avg. Monthly
Consumption FY
2020/21 (hcf)3
Tier 1 - SWP & Vallejo Raw Water
Tier Breakpoint
(hcf)4

6.00 Tier 2 - Treated Water (Napa & Vallejo)
Total SWP & Vallejo Raw Water
Total Treated Water (Napa & Vallejo)
Residential Tiers1
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 42 : RESIDENTIAL TIERED RATES
Supply Costs
Allocated to
Residential
Tiered Rates1
Source of
Supply Costs2
Other Costs
Allocated to
Vol. Rates
Total Costs
Allocated3
FY 2020/21
Consumption4
Residential
Rates ($/HCF)5
Residential Tiered Rate Costs (1) (2) (3) (4) (5) (6)
Tier 1 - SWP & Vallejo Raw Water 79.5% $ 565,431 $ 1,716,250 $ 2,281,681 322,836 $7.07 Tier 2 - Treated Water (Napa & Vallejo) 20.5% 369,096 441,426 810,523 83,035 $9.76 Total Residential Tiered Rate Costs 100.0% $ 934,527 $ 2,157,676 $ 3,092,204 405,871

1. Percentage of annual supply based on contracted purchases from Source of Supply Tab, Table 29.

2. See Table 41.

3. Total Variable Costs allocated to residential customers (Proposed Fixed Charges Tab, Table 33) less their Source of Supply Costs. NBS assumed these other costs are proportionally allocated to Tier 1 and Tier 2.

4. FY 2021/22 volume adjusted for conservation is from the Allocation Factors Tab, Table 26.

TABLE 43 : ESTIMATED VOLUMETRIC REVENUE BY CUSTOMER CLASS - PROPOSED ALTERNATIVE ALTERNATIVE 1 (COSA)
Residential
Tier 1 - SWP & Vallejo Raw Water 322,836 $ 2,459,588 40% $ 1,471,833 $ 3,931,421 $ 3,875,526 Tier 2 - Treated Water (Napa & Vallejo) 83,035 632,616 10% 378,561 1,011,177 996,800 Multi-Family 71,704 546,290 9% 1,855,536 2,401,826 2,379,400 Commercial 255,046 1,943,118 31% 244,718 2,187,836 2,179,689 Landscape 42,526 323,989 5% 43,503 367,493 365,999
Private Fire Protection 18,265 139,154 2% 92,076 231,229 334,458 Temporary Hydrant Meters 6,642 50,606 1% 17,116 67,722 67,213 Raw Water 10,431 79,472 1% 13,212 92,684 92,303
Grand Total 810,486 $ 6,174,833 100% $ 4,116,555 $ 10,291,388 $ 10,291,388 TABLE 44 : PROPOSED VOLUMETRIC CHARGES FOR FY 2023/24
ALTERNATIVE 2 - INCREASE CURRENT VARIABLE RATES BY 3% ANNUALLY Customer Classes Number of
Meters
Water
Consumption
(hcf/yr)
Total Target
Rev. Req't from
Vol. Charges
% of Total Rate
Revenue
Proposed
Commodity
Rates ($/hcf)
Revised Revenue
from Vol.

Charges
Residential 4,880
Tier 1 - SWP & Vallejo Raw Water 322,836 $ 2,459,588 39.8% $7.766 $ 2,507,212 Tier 2 - Treated Water (Napa & Vallejo) 83,035 632,616 10.2% $8.395 697,036 Multi-Family 1,273 71,704 546,290 8.8% $7.952 570,162
Commercial 343 255,046 1,943,118 31.5% $7.952 2,028,027 Landscape 73 42,526 323,989 5.2% $7.952 338,147
Private Fire Protection 245 18,265 139,154 2.3% $3.976 72,617 Temporary Hydrant Meters 8 6,642 50,606 0.8% $7.952 52,818 Raw Water 3 10,431 79,472 1.3% $3.543 36,960
Grand Total 6,825 810,486 $ 6,174,833 100% $ 6,302,977
Cost of Service
Net Revenue
Req'ts
Estimated
Fixed
Revenue
% of Variable
Rate Revenue
Total
Estimated
Revenue
Estimated
Variable Revenue Customer Class
Estimated
Consumption
(hcf)
Source of Supply
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 45 : ASSUMPTIONS USED IN DROUGHT RATE ANALYSIS
Shortage Level Percent Shortage Range Potable Water
Consumption (AF/yr.)
Potable Water
Consumption
(hcf/yr.)
Difference to
Baseline (hcf)
Baseline Consumption2
1,861 810,486 0
1 Up to 10% Voluntary Conservation 1,675 729,437 (81,049) 2 Up to 20% Water Alert 1,488 648,388 (162,097)
3 Up to 30% Water Emergency 1,302 567,340 (243,146)
4 Up to 40% Critical Water Emergency 1,116 486,291 (324,194) 5 Up to 50% Severe Water Emergency 930 405,243 (405,243) 6 >50% Catastrophic Interruption of Water Supplies 744 324,194 (486,291)

2. This represents the baseline consumption for FY 2021/22 consumption (excludes recycled water). Conservation percentage for each drought stage is relative to the baseline consumption.

TABLE 46 : EXPENSES DIRECTLY IMPACTED BY FUTURE MANDATED WATER USE REDUCTION Expenses Directly Effected By Consumption Changes
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
City of Napa $ 278,000 $ 283,560 $ 289,231 $ 295,016 $ 300,916 North Bay Aqueduct 3,203,000 3,267,060 3,332,401 3,399,049 3,467,030 City of Vallejo 121,218 123,642 126,115 128,638 131,210 Total: $ 3,602,218 $ 3,674,262 $ 3,747,748 $ 3,822,703 $ 3,899,157 TABLE 47 : CALCULATION OF DROUGHT RATES FOR FY 2023/24
ALTERNATIVE 1 (COSA)
Conservation
Goal
Water Consumption
(hcf/yr.)
Baseline Rev. Req't
from Vol. Charges
Cost Reduction Due
to Conservation1
Target Rev. Req't
from Vol. Charges
Drought Surcharge
($/hcf)
Uniform
Commodity Rates
($/hcf)
0% 810,486 $ 6,174,833 $ - $ 6,174,833 $0.00 $7.62
Up to 10% 729,437 6,174,833 (360,222) 5,814,611 $0.35 $7.97 Up to 20% 648,388 6,174,833 (720,444) 5,454,389 $0.79 $8.41 Up to 30% 567,340 6,174,833 (1,080,665) 5,094,167 $1.36 $8.98 Up to 40% 486,291 6,174,833 (1,440,887) 4,733,945 $2.12 $9.73 Up to 50% 405,243 6,174,833 (1,801,109) 4,373,724 $3.17 $10.79 >50% 324,194 6,174,833 (2,161,331) 4,013,502 $4.76 $12.38

1. Cost reduction equals the conservation goal percentage multiplied by expenses directly effected by consumption charges.

Description Commodity-Related Costs
Shortage Response Action
2021/22 Consumption Assumptions1
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WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 48 : CALCULATION OF DROUGHT RATES FOR FY 2024/25
ALTERNATIVE 1 (COSA)
Conservation
Goal
Water Consumption
(hcf/yr.)
Baseline Rev. Req't
from Vol. Charges
Cost Reduction Due
to Conservation1
Target Rev. Req't
from Vol. Charges
Drought Surcharge
($/hcf)
Uniform
Commodity Rates
($/hcf)
0% 810,486 $ 6,851,718 $ - $ 6,851,718 $0.00 $8.45
Up to 10% 729,437 6,851,718 (367,426) 6,484,291 $0.44 $8.89 Up to 20% 648,388 6,851,718 (734,852) 6,116,865 $0.98 $9.43 Up to 30% 567,340 6,851,718 (1,102,279) 5,749,439 $1.68 $10.13 Up to 40% 486,291 6,851,718 (1,469,705) 5,382,013 $2.61 $11.07 Up to 50% 405,243 6,851,718 (1,837,131) 5,014,587 $3.92 $12.37 >50% 324,194 6,851,718 (2,204,557) 4,647,160 $5.88 $14.33

1. Cost reduction equals the conservation goal percentage multiplied by expenses directly effected by consumption charges.

TABLE 49 : CALCULATION OF DROUGHT RATES FOR FY 2025/26
ALTERNATIVE 1 (COSA)
Conservation
Goal
Water Consumption
(hcf/yr.)
Baseline Rev. Req't
from Vol. Charges
Cost Reduction Due
to Conservation1
Target Rev. Req't
from Vol. Charges
Drought Surcharge
($/hcf)
Uniform
Commodity Rates
($/hcf)
0% 810,486 $ 7,595,335 $ - $ 7,595,335 $0.00 $9.37
Up to 10% 729,437 7,595,335 (374,775) 7,220,560 $0.53 $9.90 Up to 20% 648,388 7,595,335 (749,550) 6,845,785 $1.19 $10.56 Up to 30% 567,340 7,595,335 (1,124,324) 6,471,010 $2.03 $11.41 Up to 40% 486,291 7,595,335 (1,499,099) 6,096,236 $3.16 $12.54 Up to 50% 405,243 7,595,335 (1,873,874) 5,721,461 $4.75 $14.12 >50% 324,194 7,595,335 (2,248,649) 5,346,686 $7.12 $16.49

1. Cost reduction equals the conservation goal percentage multiplied by expenses directly effected by consumption charges.

TABLE 50 : CALCULATION OF DROUGHT RATES FOR FY 2026/27
ALTERNATIVE 1 (COSA)
Conservation
Goal
Water Consumption
(hcf/yr.)
Baseline Rev. Req't
from Vol. Charges
Cost Reduction Due
to Conservation1
Target Rev. Req't
from Vol. Charges
Drought Surcharge
($/hcf)
Uniform
Commodity Rates
($/hcf)
0% 810,486 $ 8,033,434 $ - $ 8,033,434 $0.00 $9.91
Up to 10% 729,437 8,033,434 (382,270) 7,651,163 $0.58 $10.49 Up to 20% 648,388 8,033,434 (764,541) 7,268,893 $1.30 $11.21 Up to 30% 567,340 8,033,434 (1,146,811) 6,886,623 $2.23 $12.14 Up to 40% 486,291 8,033,434 (1,529,081) 6,504,353 $3.46 $13.38 Up to 50% 405,243 8,033,434 (1,911,351) 6,122,082 $5.20 $15.11 >50% 324,194 8,033,434 (2,293,622) 5,739,812 $7.79 $17.70

1. Cost reduction equals the conservation goal percentage multiplied by expenses directly effected by consumption charges.

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Drought Rates, Page 34 of 45126 CITY OF AMERICAN CANYON Drought Rates

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 51 : CALCULATION OF DROUGHT RATES FOR FY 2027/28
ALTERNATIVE 1 (COSA)
Conservation
Goal
Water Consumption
(hcf/yr.)
Baseline Rev. Req't
from Vol. Charges
Cost Reduction Due
to Conservation1
Target Rev. Req't
from Vol. Charges
Drought Surcharge
($/hcf)
Uniform
Commodity Rates
($/hcf)
0% 810,486 $ 8,415,102 $ - $ 8,415,102 $0.00 $10.38
Up to 10% 729,437 8,415,102 (389,916) 8,025,186 $0.62 $11.00 Up to 20% 648,388 8,415,102 (779,831) 7,635,271 $1.39 $11.78 Up to 30% 567,340 8,415,102 (1,169,747) 7,245,355 $2.39 $12.77 Up to 40% 486,291 8,415,102 (1,559,663) 6,855,439 $3.71 $14.10 Up to 50% 405,243 8,415,102 (1,949,578) 6,465,524 $5.57 $15.95 >50% 324,194 8,415,102 (2,339,494) 6,075,608 $8.36 $18.74

1. Cost reduction equals the conservation goal percentage multiplied by expenses directly effected by consumption charges.

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Drought Rates, Page 35 of 45127 CITY OF AMERICAN CANYON Current vs. Proposed Rates

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 52 : CURRENT VS. PROPOSED WATER RATES - FIXED CHARGES FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges (in $/mo)
Residential Use
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $26.56 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $26.56 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $26.56 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $26.56 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $26.56 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $26.56 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Multi-Family, Commercial and Landscape
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter (Residential) $26.56 $31.32 $34.14 $37.21 $38.70 $39.86 1" meter (Commercial) $44.42 $31.32 $34.14 $37.21 $38.70 $39.86 1 1/2" meter $88.75 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $1,420.06 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Private Fire Protection
< 1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $13.28 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $13.28 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $13.28 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $13.28 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $13.28 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $13.28 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Temporary Hydrant Meters
< 1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $283.98 $58.53 $63.80 $69.55 $72.33 $74.50 2" meter $283.98 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $283.98 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $283.98 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $283.98 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Raw Water
< 1" meter n/a $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $44.42 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter n/a $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter n/a $178.29 $194.33 $211.82 $220.30 $226.91
4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter n/a $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Water Rate Schedule Current Proposed Rates
Rates
ALTERNATIVE 1 (COSA)
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Current & Proposed Rates, 36 of 45128 CITY OF AMERICAN CANYON Current vs. Proposed Rates

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 53 : CURRENT VS. PROPOSED WATER RATES - VARIABLE RATES FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Projected Increase in Rate Revenue per Financial Plan: 9.00% 9.00% 9.00% 4.00% 3.00% Residential Use
Tier 1 (0 - 6 units) $7.54 $7.07 $7.70 $8.40 $8.73 $8.99 Tier 2 (> 6 units) $8.15 $9.76 $10.64 $11.60 $12.06 $12.42 Multi-Family, Commercial and Landscape $7.72 $7.62 $8.30 $9.05 $9.41 $9.70 Private Fire Protection $3.86 $7.62 $8.30 $9.05 $9.41 $9.70 Temporary Hydrant Meters $7.72 $7.62 $8.30 $9.05 $9.41 $9.70 Raw Water $3.44 $7.62 $8.30 $9.05 $9.41 $9.70
TABLE 54 : CURRENT VS. PROPOSED WATER RATES - VARIABLE RATES FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Projected Increase in Rate Revenue per Financial Plan: 3.00% 3.00% 3.00% 3.00% 3.00% Residential Use
Tier 1 (0 - 6 units) $7.54 $7.77 $8.00 $8.24 $8.49 $8.74 Tier 2 (> 6 units) $8.15 $8.39 $8.65 $8.91 $9.17 $9.45
Multi-Family, Commercial and Landscape $7.72 $7.95 $8.19 $8.44 $8.69 $8.95 Private Fire Protection $3.86 $3.98 $4.10 $4.22 $4.34 $4.47 Temporary Hydrant Meters $7.72 $7.95 $8.19 $8.44 $8.69 $8.95 Raw Water $3.44 $3.54 $3.65 $3.76 $3.87 $3.99
TABLE 55 : CURRENT VS. PROPOSED DROUGHT RATES
Drought Rate Schedule (in $/hcf) Current
Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
10% Conservation n/a $0.35 $0.44 $0.53 $0.58 $0.62
20% Conservation n/a $0.79 $0.98 $1.19 $1.30 $1.39
30% Conservation n/a $1.36 $1.68 $2.03 $2.23 $2.39
40% Conservation n/a $2.12 $2.61 $3.16 $3.46 $3.71
50% Conservation n/a $3.17 $3.92 $4.75 $5.20 $5.57
60% Conservation n/a $4.76 $5.88 $7.12 $7.79 $8.36
ALTERNATIVE 2 - INCREASE CURRENT VARIABLE RATES BY 3% ANNUALLY Water Rate Schedule Current
Rates
Proposed Rates
Variable Rates for All Water Consumed (in $/hcf)
Variable Rates for All Water Consumed (in $/hcf)
Water Rate Schedule Current
Rates
Proposed Rates
ALTERNATIVE 1 (COSA)
ALTERNATIVE 1 (COSA)
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Current & Proposed Rates, 37 of 45129 CITY OF AMERICAN CANYON Current vs. Proposed Rates

WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 56 : RATES AND DROUGHT SURCHARGE FOR EACH DROUGHT STAGE Drought Rate Schedule1
No Conservation $0.00 $7.62 $0.00 $8.45 $0.00 $9.37 $0.00 $9.91 $0.00 $10.38 Up to 10% $0.35 $7.97 $0.44 $8.89 $0.53 $9.90 $0.58 $10.49 $0.62 $11.00 Up to 20% $0.79 $8.41 $0.98 $9.43 $1.19 $10.56 $1.30 $11.21 $1.39 $11.78 Up to 30% $1.36 $8.98 $1.68 $10.13 $2.03 $11.41 $2.23 $12.14 $2.39 $12.77 Up to 40% $2.12 $9.73 $2.61 $11.07 $3.16 $12.54 $3.46 $13.38 $3.71 $14.10 Up to 50% $3.17 $10.79 $3.92 $12.37 $4.75 $14.12 $5.20 $15.11 $5.57 $15.95 >50% $4.76 $12.38 $5.88 $14.33 $7.12 $16.49 $7.79 $17.70 $8.36 $18.74

1. ACTIVATION - The Drought Surcharge will NOT be added on water bills unless approved by the City Council. If the surcharge is activated, it will remain in effect as necessary and will be reviewed by the City Council at least monthly for a determination of necessity until the surcharge is deactivated.

2. Baseline water consumption is based on water usage for FY 2020/21, the same assumption used in the proposed volumetric rates.

3. Drought Surcharge is added to the Uniform Rate on a per unit basis to cover the cost of water service during times of State mandated conservation and/or extreme water supply shortage, resulting in water consumption below the established baseline.

4. The Drought Rate equals the Volumetric Rate plus Volumetric Surcharge. This does not include pumping charges which will apply where applicable. 810,486 hcf 810,486 hcf
Proposed Drought Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
810,486 hcf 810,486 hcf 810,486 hcf
Conservation Target
Drought
Surcharge 3 Drought Rate 4
Drought
Surcharge 3 Drought Rate 4
Drought
Surcharge 3 Drought Rate 4
Drought
Surcharge 3 Drought Rate 4
Drought
Surcharge 3 Drought Rate 4
Water Consumption
Baseline (hcf/yr)2
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Current & Proposed Rates, 38 of 45130 Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #1, Page 39 of 45 $655.33 $660.24 $784.38$959.40 $1,001.82 $1,035.72 $1,020.48 $1,221.03 $1,275.01 $1,316.16 $1,394.94 $1,884.48 $0
$250
$500
$750
$1,000
$1,250
$1,500
$1,750
$2,000
City of
Napa
City of
Petaluma
City of
Benicia
City of
American
Canyon
(Current)
City of
American
Canyon
(Alt. #1 -
Year 1)
City of
American
Canyon
(Alt. #2 -
Year 1)
City of
Vallejo
City of
American
Canyon
(Alt. #2 -
Year 5)
City of
American
Canyon
(Alt. #1 -
Year 5)
City of St.

Helena
Town of
Yountville
City of
Calistoga
City of American Canyon (Year 1)
Annual Water Bill Comparison - Single Family Accounts
131
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #2, Page 40 of 45 $54.61 $55.02 $65.37$79.95 $83.49 $86.31 $85.04$101.75 $106.25 $109.68 $116.25 $157.04 $0
$25
$50
$75
$100
$125
$150
$175
$200
City of
Napa
City of
Petaluma
City of
Benicia
City of
American
Canyon
(Current)
City of
American
Canyon
(Alt. #1 -
Year 1)
City of
American
Canyon
(Alt. #2 -
Year 1)
City of
Vallejo
City of
American
Canyon
(Alt. #2 -
Year 5)
City of
American
Canyon
(Alt. #1 -
Year 5)
City of St.

Helena
Town of
Yountville
City of
Calistoga
City of American Canyon (Year 1 & 5)
Monthly Water Bill Comparison - Single Family Accounts
132
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #3, Page 41 of 45 $60.58$77.70 $78.50 $79.95 $83.49 $86.31 $85.04 $101.75 $106.25 $116.25 $174.99 $217.53 $0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
City of
Petaluma
(July 2027)
City of
Benicia
(January
2026)
City of
Napa
(October
2027)
City of
American
Canyon
(Current)
City of
American
Canyon
(Alt. #1 -
Year 1)
City of
American
Canyon
(Alt. #2 -
Year 1)
City of
Vallejo
(July 2023)
City of
American
Canyon
(Alt. #2 -
Year 1)
City of
American
Canyon
(Alt. #1 -
Year 1)
Town of
Yountville
(January
2027)
City of St.

Helena
(July 2027)
City of
Calistoga
(January
2028)
City of American Canyon (Year 1 & 5)
Monthly Water Bill Comparison - Single Family Accounts
133
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 SFR Bill Comp Tiers, 42 of 45 $63.65 $79.95 $96.25$120.70 $185.90 $226.65 $63.96$83.49 $103.01$132.29 $210.38 $259.19 $69.52$86.31 $103.10$128.28 $195.44 $237.41 $0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
$275
$300
5 7 9 12 20 25
Monthly Bill
Monthly Water Consumption (HCF)
Single-Family Residential Water Bill Comparison
Current vs. Proposed FY 2023/24 Rates (1" Meter)
Residential Bill - Current Rates
Residential Bill - Alternative 1
Residential Bill - Alternative 2
Average
ANNUAL Bill
Average (9 hcf/mo.)
WINTER Bill
(7 hcf/mo.)
Average
SUMMER Bill
(12 hcf/mo.)
134
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 MFR Bill Comp, 43 of 45 $119.63 $127.35 $135.07 $142.79$165.95 $204.55 $89.01 $96.63 $104.25 $111.87$134.72 $172.82 $90.34 $98.29 $106.24 $114.20$138.05 $177.81 $0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
4 5 6 7 10 15
Monthly Bill
Monthly Water Consumption (CCF)
Multi-Family Residential Water Bill Comparison
Current vs. Proposed FY 2023/24 Rates (1.5" Meter)
Multi-Family Residential Bill - Current Rates
Multi-Family Residential Bill - Alternative 1
Multi-Family Residential Bill - Alternative 2
Average
ANNUAL Bill
Average (6 hcf/mo.)
WINTER Bill
(5 hcf/mo.)
Average
SUMMER Bill
(7 hcf/mo.)
135
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Commercial Bill Comp, 44 of 45 $527.99 $620.63 $736.43 $875.39$1,106.99 $1,299.99 $472.13 $563.55 $677.83 $814.97$1,043.53 $1,234.00 $488.77 $584.19 $703.47 $846.60$1,085.14$1,283.93 $0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
50 62 77 95 125 150
Monthly Bill
Monthly Water Consumption (CCF)
Commercial Water Bill Comparison
Current vs. Proposed FY 2023/24 Rates (2" Meter)
Commercial Bill - Current Rates
Commercial Bill - Alternative 1
Commercial Bill - Alternative 2
Average
WINTER Bill
(62 hcf/mo.)
Average
ANNUAL Bill
(77 hcf/mo.)
Average
SUMMER Bill
(95 hcf/mo.)
136
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Commercial Bill Comp (2), 45 of 45 $1,273.48 $1,366.12 $1,481.92 $1,620.88 $1,852.48 $2,045.48 $929.37 $1,020.79 $1,135.07 $1,272.21 $1,500.77 $1,691.24 $946.01 $1,041.43 $1,160.71 $1,303.84 $1,542.38 $1,741.17 $0
$250
$500
$750
$1,000
$1,250
$1,500
$1,750
$2,000
$2,250
$2,500
50 62 77 95 125 150
Monthly Bill
Monthly Water Consumption (CCF)
Commercial Water Bill Comparison
Current vs. Proposed FY 2023/24 Rates (6" Meter)
Commercial Bill - Current Rates
Commercial Bill - Alternative 1
Commercial Bill - Alternative 2
Average
ANNUAL Bill
(77 hcf/mo.)
137
Enterprise Rate Study – City of American Canyon
Prepared by NBS – February 2024 93
Appendix B. Recycled Water Rate Study Tables and Figures 138
CITY OF AMERICAN CANYON Financial Plan & Reserve Summary

RECYCLED WATER RATE STUDY
Financial Plan and Reserve Projections
TABLE 1 : FINANCIAL PLAN AND SUMMARY OF REVENUE REQUIREMENTS Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Sources of Water Funds
Rate Revenue: 1
Water Sales - Recycled Water Charges $ 151,038 $ 226,361 $ 207,000 $ 210,726 $ 214,308 $ 217,952 $ 221,657 $ 225,425 $ 229,257 $ 232,925 $ 236,652 $ 240,439 Non-Rate Revenue:

Interest Earnings2
4,101 12,392 22,343 2,195 7,873 4,912 2,640 842 - - - - Total Sources of Funds $ 155,140 $ 238,753 $ 229,343 $ 212,921 $ 222,182 $ 222,864 $ 224,297 $ 226,267 $ 229,257 $ 232,925 $ 236,652 $ 240,439 Uses of Water Funds
Operating Expenses: 1
Water Operations:

Fund 580 - Recycled Water Operations $ 272,644 $ 1,632,152 $ 893,163 $ 797,921 $ 823,477 $ 849,857 $ 877,086 $ 905,193 $ 934,206 $ 964,155 $ 995,069 $ 1,026,980 Other Expenditures:

Existing Debt Service $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Interfund Loan Repayment3
- - 198,566 198,566 267,497 267,497 267,497 267,497 267,497 267,497 267,497 267,497 Rate-Funded Capital Expenses - - - - - - - - - - - -
Subtotal: Other Expenditures $ - $ - $ 198,566 $ 198,566 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 Total Uses of Water Funds $ 272,644 $ 1,632,152 $ 1,091,728 $ 996,487 $ 1,090,974 $ 1,117,354 $ 1,144,583 $ 1,172,690 $ 1,201,703 $ 1,231,652 $ 1,262,566 $ 1,294,477 plus: Revenue from Rate Increases4 - - 129,375 563,692 652,033 728,149 788,637 827,104 841,165 854,623 868,297 882,190 Annual Surplus/(Deficit) $ (117,504) $ (1,393,399) $ (733,011) $ (219,874) $ (216,759) $ (166,341) $ (131,650) $ (119,320) $ (131,281) $ (144,103) $ (157,617) $ (171,849) Net Revenue Req't. (Total Uses less Non-Rate Revenue) $ 268,543 $ 1,619,760 $ 1,069,386 $ 994,292 $ 1,083,101 $ 1,112,441 $ 1,141,943 $ 1,171,848 $ 1,201,703 $ 1,231,652 $ 1,262,566 $ 1,294,477 Total Rate Revenue After Rate Increases $ 151,038 $ 226,361 $ 724,500 $ 811,295 $ 907,596 $ 969,176 $ 1,034,935 $ 1,052,529 $ 1,070,422 $ 1,087,548 $ 1,104,949 $ 1,122,628 Projected Annual Rate Revenue Increase 0.00% 0.00% 250.00% 10.00% 10.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% Cumulative Increase from Annual Revenue Increases 0.00% 0.00% 250.00% 285.00% 323.50% 344.68% 366.91% 366.91% 366.91% 366.91% 366.91% 366.91%

2. Interest earnings for FY 2021/22 and FY 2022/23 are from the City's Budget. For all other years, it is calculated based on historical LAIF returns.

3. Repayment of interfund loans advanced by Wastewater Capacity 550 to Recycled Water Operations 540 for various project. See Exhibit 3 (Debt) for more details.

4. Revenue from rate increases assumes an implementation date of April 1, 2024 for new rates. For each year thereafter, the assumption is that new rates will be implemented on January 1st of each year. 1 <-- Select Financial Plan Scenario Here
Financial Plan Alternatives FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 1 Alternative 1 - Full Cost Recovery Rate Increases1

0.00% 0.00% 250.00% 10.00% 10.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2 Alternative 2 - Phased-in Rate Increases2

0.00% 0.00% 20.00% 20.00% 5.00% 2.00% 2.00% 0.00% 0.00% 0.00% 0.00% 0.00% 3 Alternative 3 - Minimal Rate Increases3

0.00% 0.00% 15.00% 15.00% 10.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 4 Alternative 4 - No Rate Increases 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

1. Alternative 1: Scenario 1 - Rates needed to meet all revenue requirements and meet the target reserve levels (Large increase followed by smaller increases).

2. Alternative 2: Scenario 2 - Large increases phased In over two years, followed by smaller increases (Reserves drop below target level).

3. Alternative 3: Scenario 3 - Smaller increases (Reserves drop below target level).

RATE REVENUE REQUIREMENTS SUMMARY
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 RW - Financial Plan, Page 1 of 21 139 CITY OF AMERICAN CANYON Financial Plan & Reserve Summary

RECYCLED WATER RATE STUDY
Financial Plan and Reserve Projections
TABLE 2 : RESERVE FUND SUMMARY
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Unrestricted Reserve:

Total Beginning Cash1
$ 105,383 $ 549,510
Operating Reserve
Beginning Reserve Balance $ 105,383 $ 549,510 $ 650,000 $ (83,011) $ (302,885) $ (519,644) $ (685,985) $ (817,634) $ (936,954) $ (1,068,236) $ (1,212,339) $ (1,369,955) Plus: Net Cash Flow (After Rate Increases) (117,504) (1,393,399) (733,011) (219,874) (216,759) (166,341) (131,650) (119,320) (131,281) (144,103) (157,617) (171,849) Plus: Transfer in from Capital and Infrastructure Reserve - - - - - - - - - - - - Less: Transfer out to Capital and Infrastructure Reserve - - - - - - - - - - - - Ending Operating Reserve Balance $ (12,121) $ (843,889) $ (83,011) $ (302,885) $ (519,644) $ (685,985) $ (817,634) $ (936,954) $ (1,068,236) $ (1,212,339) $ (1,369,955) $ (1,541,804) Target Ending Balance (90-days of O&M) 2
$ 68,000 $ 408,000 $ 223,000 $ 199,000 $ 206,000 $ 212,000 $ 219,000 $ 226,000 $ 234,000 $ 241,000 $ 249,000 $ 257,000 Capital Rehabilitation & Replacement Reserve
Beginning Reserve Balance $ - $ - $ 243,704 $ 243,704 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 Plus: Transfer of Operating Reserve Surplus - - - - - - - - - - - - Less: Transfer out to Operating Reserve - - - - - - - - - - - - Less: Use of Reserves for Capital Projects - - - - - - - - - - - - Ending Capital and Infrastructure Reserve Balance $ - $ 243,704 $ 243,704 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 $ 879,258 Target Ending Balance (3% of net assets) 3
$ 1,420,700 $ 1,548,600 $ 1,870,900 $ 2,079,900 $ 2,260,500 $ 2,370,700 $ 2,458,100 $ 2,548,200 $ 2,641,000 $ 2,736,700 $ 2,835,300 $ 2,937,000 Ending Balance - Excl. Restricted Reserves $ (12,121) $ (600,185) $ 160,693 $ 576,373 $ 359,614 $ 193,273 $ 61,624 $ (57,696) $ (188,977) $ (333,081) $ (490,697) $ (662,546) Min. Target Ending Balance -Excl. Restricted Reserves $ 1,488,700 $ 1,956,600 $ 2,093,900 $ 2,278,900 $ 2,466,500 $ 2,582,700 $ 2,677,100 $ 2,774,200 $ 2,875,000 $ 2,977,700 $ 3,084,300 $ 3,194,000 Ending Surplus/(Deficit) Compared to Reserve Targets $ (1,500,821) $ (2,556,785) $ (1,933,207) $ (1,702,527) $ (2,106,886) $ (2,389,427) $ (2,615,476) $ (2,831,896) $ (3,063,977) $ (3,310,781) $ (3,574,997) $ (3,856,546) Annual Interest Earnings Rate 4

1.37% 2.50% 2.50% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37%

1. Beginning cash balances provided by City staff for Fund 580 - Recycled Water Operations. Source file: 4 - Current Cash and Fund Balance - Recycled Water 12062021.xlsx , Beg Fund Balance FY23- Water.xls , & Beg Fund Balance FY23- Recycled Water.xls .

2. The target ending balance is set equal to 90-days of O&M expenses. Source file: 4 - Current Cash and Fund Balance - Water 12062021.xlsx .

3. The target ending balance is set equal to 3% of net capital assets. See Exhibit 2 (CIP) for details.

4. Historical interest earning rates are per the average annual yields for funds invested in LAIF (2017-2021). The source is the California State Treasurer's website: https://www.treasurer.ca.gov/pmia-laif/historical/annual.asp .

SUMMARY OF CASH ACTIVITY
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 RW - Financial Plan, Page 2 of 21 140 CITY OF AMERICAN CANYON Charts & Tables

RECYCLED WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 1
$.0 Mil.
$.5 Mil.
$1.0 Mil.
$1.5 Mil.
$2.0 Mil.
$2.5 Mil.
2022 2023 2024 2025 2026 2027 2028
Annual Obligations
Fiscal Year Ending June 30
Water Revenue Requirements vs.

Revenue Under Existing and Increased Rates
Interfund Loan Repayment
O&M Expenses
Revenues under Existing Rates
Revenues under Increased Rates
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 RW - Charts and Tables, 3 of 21141 CITY OF AMERICAN CANYON Charts & Tables

RECYCLED WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 2
$.0 Mil.
$.5 Mil.
$1.0 Mil.
$1.5 Mil.
$2.0 Mil.
$2.5 Mil.
$3.0 Mil.
2022 2023 2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Ending Cash Balances vs.

Recommended Reserve Targets
Ending Cash Balance (Unrestricted Reserves) Minimum Target Reserve Balance Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 RW - Charts and Tables, 4 of 21142 CITY OF AMERICAN CANYON Charts & Tables

RECYCLED WATER RATE STUDY
Rate Adjustment Charts and Report Tables
CHART 3
250.0%

10.0% 10.0% 5.0% 5.0%
0%
50%
100%
150%
200%
250%
300%
2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Projected Increases to Rate Revenue
Prepared by NBS
www.nbsgov.com | Toll-free: 800.676.7516 RW - Charts and Tables, 5 of 21143 CITY OF AMERICAN CANYON Exhibit 1 - O&M

RECYCLED WATER RATE STUDY
Operating Revenue and Expenses
TABLE 3 : REVENUE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Rate Revenue
Water Service Charge - Recycled Water 1 $ 151,038 $ 226,361 $ 207,000 $ 210,726 $ 214,308 $ 217,952 $ 221,657 $ 225,425 $ 229,257 $ 232,925 $ 236,652 $ 240,439 Other Revenue
Interest Earnings See FP 4,101 12,392 - - - - - - - - - - TOTAL: REVENUE $ 155,140 $ 238,753 $ 207,000 $ 210,726 $ 214,308 $ 217,952 $ 221,657 $ 225,425 $ 229,257 $ 232,925 $ 236,652 $ 240,439 TABLE 4 : OPERATING EXPENSE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Fund 580 - Recycled Water Operations
Wages - Full time 3 $ - $ 217 $ 209,085 $ 216,403 $ 223,977 $ 231,816 $ 239,930 $ 248,327 $ 257,019 $ 266,015 $ 275,325 $ 284,961 Health Insurance 3 - - 35,576 36,821 38,109 39,443 40,824 42,253 43,731 45,262 46,846 48,486 Health-In_Lieu 3 - - 2,280 2,360 2,442 2,528 2,616 2,708 2,803 2,901 3,002 3,107 Cafeteria Plan Section 125 3 - - 9,599 9,935 10,282 10,642 11,015 11,400 11,799 12,212 12,640 13,082 PERS Retirement 3 - 1,246 26,843 27,782 28,755 29,761 30,803 31,881 32,997 34,152 35,347 36,584 Benefits - Other 3 - - 471 488 505 522 541 560 579 599 620 642 Social Security & Medicare 3 - 3 3,204 3,316 3,432 3,552 3,677 3,805 3,938 4,076 4,219 4,367 Worker Comp Insurance 3 - 526 22,467 23,254 24,067 24,910 25,782 26,684 27,618 28,585 29,585 30,621 Info Tech Support Services 2 - - 54,000 55,620 57,289 59,007 60,777 62,601 64,479 66,413 68,406 70,458 Professional Services 2 13,511 16,694 51,000 52,530 54,106 55,729 57,401 59,123 60,897 62,724 64,605 66,543 Misc Contractual Services 2 - 117,361 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610 Temp Agency Services 2 - - - - - - - - - - - -
General Repairs & Maint 2 - 727 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 Postage/Mail/Copy/Printing Svc 2 - 36 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 Membership Dues & Subscription 2 - - 1,000 1,030 1,061 1,093 1,126 1,159 1,194 1,230 1,267 1,305 Conferences - Training 2 - - 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610 Office Supplies 2 - - 500 515 530 546 563 580 597 615 633 652 Operating Supplies 2 - 7,594 123,000 126,690 130,491 134,405 138,438 142,591 146,868 151,274 155,813 160,487 AC Recycled Water 2 36,360 18,437 - - - - - - - - - -
Depreciation 2 222,773 222,255 - - - - - - - - - -
Depreciation - Infrastructure 2 - - - - - - - - - - - - Vehicles 2 - - - - - - - - - - - -
Major Equipment 8 - - 70,000 - - - - - - - - -
Transfers Out To Other Funds 8 - 1,196,580 50,000 - - - - - - - - - Retiree Health Benefits 3 - 134 1,973 2,042 2,114 2,188 2,264 2,344 2,426 2,510 2,598 2,689 OPEB 3 - 1,115 1,251 1,295 1,340 1,387 1,436 1,486 1,538 1,592 1,647 1,705 ISF - Bldg Maint 2 - 26,844 39,873 41,069 42,301 43,570 44,877 46,224 47,610 49,039 50,510 52,025 ISF - Legal Services 2 - 514 23,705 24,416 25,149 25,903 26,680 27,481 28,305 29,154 30,029 30,930 Capital Outlay-Contra Account 8 - - - - - - - - - - - - Transfer to Gen Fnd Support Sv 2 - 21,869 138,336 142,486 146,761 151,163 155,698 160,369 165,180 170,136 175,240 180,497 Interest Payments for Internal Loans See Exh. 3 - - - - - - - - - - - - TOTAL: RECYCLED WATER OPERATIONS EXPENSES $ 272,644 $ 1,632,152 $ 893,163 $ 797,921 $ 823,477 $ 849,857 $ 877,086 $ 905,193 $ 934,206 $ 964,155 $ 995,069 $ 1,026,980 DESCRIPTION Basis
5-Year Projected Rate Period Projected
DESCRIPTION Basis
5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 1 (O&M), 6 of 21 144 CITY OF AMERICAN CANYON Exhibit 1 - O&M

RECYCLED WATER RATE STUDY
Operating Revenue and Expenses
TABLE 5 : FORECASTING ASSUMPTIONS
Basis 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Customer Growth31 -- 1.80% 1.80% 1.80% 1.70% 1.70% 1.70% 1.70% 1.70% 1.60% 1.60% 1.60% General Cost Inflation42 -- 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Labor Cost Inflation53 -- 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Energy64 -- 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% Electricty75 -- 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% Fuel & Utilities86 -- 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% Construction Cost Inflation97 -- 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% No Escalation 8 -- 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

2. Expenses are inflated each year by the following annual inflation factor categories.

3. Customer growth is based on service area population growth through FY 2039/40. Source file: American Canyon 2015 UWMP.pdf , page 26.

4. General cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

5. Labor cost inflation is based on the 5-year average annual change in the Quarterly Census of Employment and Wages for San Francisco County, CA.

6. Energy cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

7. Electricity cost inflation is based on the 5-year average change in the Consumer Price Index for San Francisco County.

9. Construction cost Inflation is the 10-year average change in the Construction Cost Index for 2012-2022. Source: Engineering News Record website (http://enr.construction.com ).

INFLATION FACTORS2
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 1 (O&M), 7 of 21 145 CITY OF AMERICAN CANYON Exhibit 2 - CIP

RECYCLED WATER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 6 : CAPITAL FUNDING SUMMARY
CAPITAL FUNDING FORECAST Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Grants1$ 235,463 $ 243,704 $ 385,279 $ 635,554 $ - $ - $ - $ - $ - $ - $ - $ - Use of Capacity Fee Reserves - - - 16,812 1,989,375 2,059,003 2,131,068 1,756,623 1,818,105 1,881,739 1,947,600 2,015,766 SRF Loan Funding - - - - - - - - - - - -
Use of New Revenue Bond Proceeds - - - - - - - - - - - - Use of Capital Rehabilitation and Replacement Reserve - - - - - - - - - - - - Rate Revenue - - - - - - - - - - - -
Total Sources of Capital Funds $ 235,463 $ 243,704 $ 385,279 $ 652,367 $ 1,989,375 $ 2,059,003 $ 2,131,068 $ 1,756,623 $ 1,818,105 $ 1,881,739 $ 1,947,600 $ 2,015,766 Uses of Capital Funds:

Total Project Costs $ 235,463 $ 243,704 $ 385,279 $ 652,367 $ 1,989,375 $ 2,059,003 $ 2,131,068 $ 1,756,623 $ 1,818,105 $ 1,881,739 $ 1,947,600 $ 2,015,766 Capital Funding Surplus (Deficiency) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

1. Grant from American Rescue Plan Act (ARPA) Funds through Napa County for the Recycled Water System Expansion Project (RW17-0100). Source file: RESOLUTION 2022-58.pdf .

CAPITAL IMPROVEMENT PROGRAM FUNDING OPTIONS
Capital Improvement Program Funding Choice FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Effective Annual Funding Amount $ 235,463 $ 243,704 $ 385,279 $ 652,367 $ 1,989,375 $ 2,059,003 $ 2,131,068 $ 1,756,623 $ 1,818,105 $ 1,881,739 $ 1,947,600 $ 2,015,766

CAPITAL IMPROVEMENT PROGRAM
TABLE 7 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Current-Year Dollars) 1 Project No. Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects 2
NEW Recycled Water Fill Stations $ - $ - $ 120,000 $ - $ - $ - $ - $ - $ - $ - $ - $ - Master Plan Projects - Recycled Water 3
RW1 Tower / Devlin / South Kelly Road $ 137,500 $ 137,500 $ 137,500 $ 137,500 $ - $ - $ - $ - $ - $ - $ - $ - RW2 Spikerush Circle 31,000 31,000 31,000 31,000 - - - - - - - - RW3 Benton Way 59,000 59,000 59,000 59,000 - - - - - - - - RW4 Pelleria Drive - - - 32,000 32,000 32,000 32,000 - - - - - RW5 Jim Oswald Way / Mezzetta Court / Green Island Road - - - 121,000 121,000 121,000 121,000 - - - - - RW6 Hanna Drive - - - 76,000 76,000 76,000 76,000 - - - - - RW7 Dodd / Klamath Court - - - 24,000 24,000 24,000 24,000 - - - - - RW8 Lombard / Hess Road - - - 88,000 88,000 88,000 88,000 - - - - - RW9 Watson Lane - - - - 135,000 135,000 135,000 135,000 135,000 135,000 135,000 135,000 RW10 Main / South Napa Junction Road - - - - 299,000 299,000 299,000 299,000 299,000 299,000 299,000 299,000 RW11 Newell Drive - - - - 205,000 205,000 205,000 205,000 205,000 205,000 205,000 205,000 RW12 PS Upgrade - - - - 80,000 80,000 80,000 80,000 80,000 80,000 80,000 80,000 RW13 Paoli Loop Road / Northern Vineyards - - - - 140,000 140,000 140,000 140,000 140,000 140,000 140,000 140,000 RW14 Eucalyptus Drive - - - - 128,000 128,000 128,000 128,000 128,000 128,000 128,000 128,000 RW15 Broadway / Donaldson Way - - - - 347,000 347,000 347,000 347,000 347,000 347,000 347,000 347,000 Estimated Future Projects
Future Projects4 - - - - - - - - - - - -
Total: CIP Program Costs (Future-Year Dollars) $ 227,500 $ 227,500 $ 347,500 $ 568,500 $ 1,675,000 $ 1,675,000 $ 1,675,000 $ 1,334,000 $ 1,334,000 $ 1,334,000 $ 1,334,000 $ 1,334,000 5-Year Projected Rate Period Projected
Funding Sources:

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 2 (CIP), 8 of 21 146 CITY OF AMERICAN CANYON Exhibit 2 - CIP

RECYCLED WATER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 8 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Future-Year Dollars) 5 Project No. Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects 2
NEW Recycled Water Fill Stations $ - $ - $ 133,046 $ - $ - $ - $ - $ - $ - $ - $ - $ - Master Plan Projects - Recycled Water 3
RW1 Tower / Devlin / South Kelly Road $ 142,313 $ 147,293 $ 152,449 $ 157,784 $ - $ - $ - $ - $ - $ - $ - $ - RW2 Spikerush Circle 32,085 33,208 34,370 35,573 - - - - - - - - RW3 Benton Way 61,065 63,202 65,414 67,704 - - - - - - - - RW4 Pelleria Drive - - - 36,721 38,006 39,336 40,713 - - - - - RW5 Jim Oswald Way / Mezzetta Court / Green Island Road - - - 138,850 143,710 148,740 153,946 - - - - - RW6 Hanna Drive - - - 87,212 90,264 93,423 96,693 - - - - - RW7 Dodd / Klamath Court - - - 27,541 28,504 29,502 30,535 - - - - - RW8 Lombard / Hess Road - - - 100,982 104,516 108,174 111,961 - - - - - RW9 Watson Lane - - - - 160,338 165,949 171,758 177,769 183,991 190,431 197,096 203,994 RW10 Main / South Napa Junction Road - - - - 355,118 367,547 380,411 393,726 407,506 421,769 436,531 451,810 RW11 Newell Drive - - - - 243,476 251,997 260,817 269,946 279,394 289,173 299,294 309,769 RW12 PS Upgrade - - - - 95,015 98,340 101,782 105,345 109,032 112,848 116,798 120,885 RW13 Paoli Loop Road / Northern Vineyards - - - - 166,276 172,096 178,119 184,353 190,806 197,484 204,396 211,550 RW14 Eucalyptus Drive - - - - 152,024 157,345 162,852 168,552 174,451 180,557 186,876 193,417 RW15 Broadway / Donaldson Way - - - - 412,127 426,552 441,481 456,933 472,925 489,478 506,609 524,341 Estimated Future Projects
Future Projects4 - - - - - - - - - - - -
Total: CIP Program Costs (Future-Year Dollars) $ 235,463 $ 243,704 $ 385,279 $ 652,367 $ 1,989,375 $ 2,059,003 $ 2,131,068 $ 1,756,623 $ 1,818,105 $ 1,881,739 $ 1,947,600 $ 2,015,766 TABLE 9 : FORECASTING ASSUMPTIONS
Economic Variables FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Annual Construction Cost Inflation, Per Engineering News Record63.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Cumulative Construction Cost Multiplier from FY 2021/22 1.04 1.07 1.11 1.15 1.19 1.23 1.27 1.32 1.36 1.41 1.46 1.51

1. Capital project costs were provided by City Staff in source file: Water Projects.pdf.

2. Capital projects costs for FY 2021/22 and FY 2022/23 are from source files: 11. CIP Budget vs Expense Report FY 2021-2022 through Oct 2021.pdf .

3. The City's Recycled Water Master Plan projects were scheduled to begin in 2016; however, the study only includes costs from FY 2021/22 through FY 2034/35. Source file: 2016 Recycled Water Master Plan.pdf , page 63.

4. Future project costs beyond FY 2034/35 are calculated based on the City's 10-year average.

5. Capital improvement projects are inflated to future year estimated costs with ENR CCI for the region. Source: Engineering News Record website (http://enr.construction.com ).

Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 2 (CIP), 9 of 21 147 CITY OF AMERICAN CANYON Exhibit 3 - Debt

RECYCLED WATER RATE STUDY
Debt Service
TABLE 10 : EXISTING DEBT OBLIGATIONS
EXISTING DEBT OBLIGATIONS Actuals Actuals
Annual Repayment Schedules: FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Interfund Loans
Water Operations to Recycled Water Fund
Advance from Water Operations 510 to Recycled Water Operations 580 Original Loan Amount (June 20, 2023) $ 1,136,140
Accrued Interest (LAIF Rate + 2%) 981
Annual Debt Service1
$44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 $44,061 Water Operations to Recycled Water Fund
Advance from Water Operations 510 to Recycled Water Operations 580 Original Loan Amount (September 21, 2021) $ 128,189
Accrued Interest (LAIF Rate + 2%) 11,706
Annual Debt Service2
$ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 $ 5,421 Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (March 17, 2011) $ 1,070,000
Accrued Interest (LAIF Rate + 2%) 205,869
Annual Debt Service3
$ 49,438 $ 49,438 $ 49,438 $ 49,438 $ 49,438 $ 49,438 $ 49,438 $ 49,438 Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (December 15, 2009) $ 304,614
Accrued Interest (LAIF Rate + 2%) 58,577
Annual Debt Service4
$ 14,073 $ 14,073 $ 14,073 $ 14,073 $ 14,073 $ 14,073 $ 14,073 $ 14,073 Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (December 15, 2009) $ 3,532,410
Accrued Interest (LAIF Rate + 2%) 454,994
Annual Debt Service5
$ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504 $ 154,504

1. Funds advanced for the Recycled Water Expansion Project. Repayment scheduled to begin FY 2023/24.

2. Funds advanced for Green Island Recycled Waterline Project. Repayment scheduled to begin FY 2025/26.

3. Funds advanced for the Green Island Road Recycled Waterline Project. Repayment scheduled to begin FY 2025/26.

4. Funds advanced for the Recycled Water Pump Station Upgrade. Repayment scheduled to begin FY 2025/26.

5. Funds advance for various CIP projects. Repayment scheduled to begin FY 2025/26.

TABLE 11 : EXISTING ANNUAL DEBT OBLIGATIONS TO BE SATISFIED BY WATER RATES Annual Obligations FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Existing Interfund Loan Repayment $ - $ - $ 198,566 $ 198,566 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 $ 267,497 5-Year Projected Rate Period Projected
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 3 (Debt), 10 of 21 148 CITY OF AMERICAN CANYON Exhibit 4 - Current Rates

RECYCLED WATER RATE STUDY
Projected Water Rates Under Existing Rate Schedule
TABLE 12 : CURRENT RECYCLED WATER RATE SCHEDULE
Current Rates
Jan. 1, 2023
Monthly Fixed Service Charges
Recycled Water2
< 1" meter $26.56
1" meter $44.42
1 1/2" meter $88.75
2" meter $141.99
3" meter $283.98
4" meter $443.74
6" meter $887.48
8" meter $1,420.06
Variable Rates for All Water Consumed (in $/hcf) 3
Recycled Water $0.90

1. Rates available on the City website. Source: https://www.cityofamericancanyon.org .

2. Green Island Vineyard is charged different rates based on contract terms.

3. HCF = hundred cubic feet (748 gallons).

Recycled Water Rate Schedule1
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Exhibit 4 (Current Rates), 11 of 21149 CITY OF AMERICAN CANYON Functionalization & Classification

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 13 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (COM) (CAP) (CA) (COM) (CAP) (CA)
Fund 580 - Recycled Water Operations
Wages - Full time $ 209,085 $ 104,543 $ 83,634 $ 20,909 50.0% 40.0% 10.0% Health Insurance 35,576 17,788 14,230 3,558 50.0% 40.0% 10.0% Health-In_Lieu 2,280 1,140 912 228 50.0% 40.0% 10.0%
Cafeteria Plan Section 125 9,599 4,799 3,839 960 50.0% 40.0% 10.0% PERS Retirement 26,843 13,421 10,737 2,684 50.0% 40.0% 10.0% Benefits - Other 471 236 188 47 50.0% 40.0% 10.0%
Social Security & Medicare 3,204 1,602 1,282 320 50.0% 40.0% 10.0% Worker Comp Insurance 22,467 11,234 8,987 2,247 50.0% 40.0% 10.0% Info Tech Support Services 54,000 27,000 21,600 5,400 50.0% 40.0% 10.0% Professional Services 51,000 25,500 20,400 5,100 50.0% 40.0% 10.0% Misc Contractual Services 2,000 1,000 800 200 50.0% 40.0% 10.0% General Repairs & Maint 20,000 10,000 8,000 2,000 50.0% 40.0% 10.0% Postage/Mail/Copy/Printing Svc 5,000 2,500 2,000 500 50.0% 40.0% 10.0% Membership Dues & Subscription 1,000 500 400 100 50.0% 40.0% 10.0% Conferences - Training 2,000 1,000 800 200 50.0% 40.0% 10.0% Office Supplies 500 250 200 50 50.0% 40.0% 10.0%
Operating Supplies 123,000 61,500 49,200 12,300 50.0% 40.0% 10.0% Major Equipment 70,000 35,000 28,000 7,000 50.0% 40.0% 10.0% Transfers Out To Other Funds 50,000 25,000 20,000 5,000 50.0% 40.0% 10.0% Retiree Health Benefits 1,973 987 789 197 50.0% 40.0% 10.0% OPEB 1,251 625 500 125 50.0% 40.0% 10.0%
ISF - Bldg Maint 39,873 19,937 15,949 3,987 50.0% 40.0% 10.0% ISF - Legal Services 23,705 11,853 9,482 2,371 50.0% 40.0% 10.0% Transfer to Gen Fnd Support Sv 138,336 69,168 55,334 13,834 50.0% 40.0% 10.0% Total: Recycled Water Operations Expenses $ 893,163 $ 446,581 $ 357,265 $ 89,316 50.0% 40.0% 10.0% Total: Recycled Water Operations Expenses $ 893,163 $ 446,581 $ 357,265 $ 89,316 50.0% 40.0% 10.0% Current Allocation Total: Operations Expenses - Delivered1
$ 732,393 $ 366,197 $ 292,957 $ 73,239 50.0% 40.0% 10.0% 82% Total: Operations Expenses - Self-Haul1
$ 160,769 $ 80,385 $ 64,308 $ 16,077 50.0% 40.0% 10.0% 18%

1. Delivered and self-haul recycled water rates based on direction provided by City staff; that is, 82 % of O&M costs attributed to delivered water and 18% to self-haul.

Budget Categories
Total Revenue
Requirements
Commodity Capacity Customer Basis of Classification
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Funct. & Classification, 12 of 21 150 CITY OF AMERICAN CANYON Functionalization & Classification

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 14 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS, cont.

Classification of Expenses, continued
FY 2023/24 (COM) (CAP) (CA) (COM) (CAP) (CA)
Debt Service Payments
Outstanding Debt $ - $ - $ - $ - 0.0% 100.0% 0.0%
Interfund Loan Repayment 198,566 - 198,566 - 0.0% 100.0% 0.0% Total Debt Service Payments $ 198,566 $ - $ 198,566 $ - 0.0% 100.0% 0.0% Current Allocation Total Debt Service Payments - Delivered $ 99,283 $ - $ 99,283 $ - 0.0% 100.0% 0.0% 50% Total Debt Service Payments - Self-Haul $ 99,283 $ - $ 99,283 $ - 0.0% 100.0% 0.0% 50% Capital Expenditures
Rate Funded Capital Expenses $ - $ - $ - $ - 0.0% 100.0% 0.0% Current Allocation Total Capital Expenditures - Delivered $ - $ - $ - $ - 0.0% 100.0% 0.0% 50% Total Capital Expenditures - Self-Haul $ - $ - $ - $ - 0.0% 100.0% 0.0% 50% TOTAL REVENUE REQUIREMENTS $ 1,091,728 $ 446,581 $ 555,831 $ 89,316 40.9% 50.9% 8.2% TOTAL REVENUE REQUIREMENTS - Delivered $ 831,676 $ 366,197 $ 392,240 $ 73,239 44.0% 47.2% 8.8% TOTAL REVENUE REQUIREMENTS - Self-Haul $ 260,052 $ 80,385 $ 163,591 $ 16,077 30.9% 62.9% 6.2% Less: Non-Rate Revenues
Other Revenue
Interest Earnings (22,343) (9,139) (11,375) (1,828) 40.9% 50.9% 8.2% NET REVENUE REQUIREMENTS $ 1,069,386 $ 437,442 $ 544,455 $ 87,488 Allocation of Revenue Requirements 100.0% 40.9% 50.9% 8.2% Current Allocation NET REVENUE REQUIREMENTS - Delivered $ 813,355 $ 358,702 $ 382,912 $ 71,740 44.1% 47.1% 8.8% 82% NET REVENUE REQUIREMENTS - Self-Haul $ 256,030 $ 78,740 $ 161,543 $ 15,748 9.7% 19.9% 1.9% 18% TABLE 15 : ADJUSTMENT TO CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses, continued
Adjustments to Classification of Expenses
Adjustment for Current Rate Level: Total (COM) (CAP) (CA) Test Year (FY 2023/24) Target Rate Rev. After Rate Increases$ 1,069,386 Projected Rate Revenue at Current Rates $ 207,000
Test Year (FY 2023/24) Projected Rate Adjustment 417%
Adjusted Net Revenue Req'ts $ 1,069,386 $ 437,442 $ 544,455 $ 87,488 Percent of Revenue 100.0% 40.9% 50.9% 8.2%
TABLE 16 : NET REVENUE REQUIREMENTS PER COSA RESULTS
Total Rate
Revenue
Requirements
FY 2023/24
Commodity
Related Costs
Capacity
Related Costs
Customer
Related Costs
Rate-Design Adjustments to Fixed/Variable % 100.0% 40.9% 50.9% 8.2% Rate-Design Adjustments to Fixed/Variable ($) $1,069,386 $437,442 $544,455 $87,488 Basis of Classification
Net Revenue Requirements - Per COSA Results
59% Fixed / 41% Variable
Budget Categories
Total Revenue
Requirements
Commodity Capacity Customer
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Funct. & Classification, 13 of 21 151 CITY OF AMERICAN CANYON Functionalization & Classification

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 17 : REVISED NET REVENUE REQUIREMENTS PER COSA RESULTS Rate-Design Adjustments to Fixed/Variable % 100.0% 40.9% 50.9% 8.2% Rate-Design Adjustments to Fixed/Variable ($) $1,069,386 $437,442 $544,455 $87,488 TABLE 18 : REVISED NET REVENUE REQUIREMENTS - (40% FIXED/60% VOLUMETRIC) - ALTERNATIVE 2 Rate-Design Adjustments to Fixed/Variable % 100.0% 60.0% 34.5% 5.5% Rate-Design Adjustments to Fixed/Variable ($) $1,069,386 $641,631 $368,535 $59,220 TABLE 19 : REVISED NET REVENUE REQUIREMENTS - (20% FIXED/80% VOLUMETRIC) - ALTERNATIVE 3 Rate-Design Adjustments to Fixed/Variable % 100.0% 80.0% 17.2% 2.8% Rate-Design Adjustments to Fixed/Variable ($) $1,069,386 $855,509 $184,267 $29,610 Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Funct. & Classification, 14 of 21 152 CITY OF AMERICAN CANYON Cost-of-Service Analysis

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 20 : ALLOCATION OF RECYCLED WATER REVENUE REQUIREMENTS

PROPOSED ALTERNATIVE
Variable (Collected from Vol. Rates) $ 855,509 80%
Fixed (Collected from Fixed Charges) 213,877 20%
Net Revenue Requirement $ 1,069,386 100%

1. For calculation, see the RW - Funct. & Classification tab.

TABLE 21 : ALLOCATION OF NET REVENUE REQUIREMENTS - FY 2023/24

PROPOSED ALTERNATIVE
Recycled Water
Recycled Water 272,268 458 100.0% $ 855,509 $ 213,877 $ 1,069,386 $3.14 $38.89 Total Net Revenue Requirement 272,268 458 100.0% $ 855,509 $ 213,877 $ 1,069,386 -- --

1. Source file: 2020 Urban Water Management Plan , Figure 6.4.

2. Number of meters by size times the hydraulic capacity factor for each meter size. Source: AWWA, Manual M1, Table B-1 & AWWA, Manual M6, Table 5-3.

3. Total Variable Costs times the proportional share of annual RW consumption.

4. Fixed costs times the percent of equivalent meters.

5. Total Variable Costs divided by Total Annual RW Consumption.

6. Total Fixed Costs divided by total Equivalent Meters. This provides the basis for monthly fixed charges for each meter size.

TABLE 22 : CALCULATION OF MONTHLY FIXED METER SERVICE CHARGES FOR FY 2023/24

PROPOSED ALTERNATIVE
Total
< 1" meter 1" meter 1 1/2" meter 2" meter 3" meter 4" meter 6" meter 8" meter Recycled Water
Recycled Water 2 13 14 28 13 6 0 0 76
Total Meters/Accounts 2 13 14 28 13 6 0 0 76
Hydraulic Capacity Factor 21.00 1.67 3.33 5.33 10.67 16.67 33.33 53.33 Total Equivalent Meters 2 22 47 149 139 100 0 0 458
Monthly Fixed Service Charges
Fixed Charge ($/EM/month)3
$38.89 $38.89 $38.89 $38.89 $38.89 $38.89 $38.89 $38.89 Fixed Monthly Charge $38.89 $64.81 $129.62 $207.40 $414.79 $648.11 $1,296.23 $2,073.96 Annual Fixed Costs Allocated to Monthly Meter Charges
Total Revenue from RW Meter Charges $ 933 $ 10,111 $ 21,777 $ 69,685 $ 64,708 $ 46,664 $ - $ - $ 213,877

1. Meter by Class and Size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

3. Cost per month per equivalent meter. Monthly fixed charges are set for each meter size using the hydraulic capacity factors and total equivalent meters.

RW Fixed
Charges
($/Eq. Meter/
Month) 6
RW
Volumetric
Rate ($/hcf) No. of Equiv. 5
Meters
Recycled Water
Classification Components
Number of RW Meters
by Class and Size1
Cost-of-Service Net Revenue
Requirements (2023/24) 1
Equivalent Meters2
% of Equiv.

Meters
FY 2023/24
Recycled Water Customers
Cost Allocation Factors
Net Revenue
Req'ts
Annual RW
Consumption1
Fixed
Costs4
Variable
Costs3
Cost Classifications
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW- COSA, 15 of 21153 CITY OF AMERICAN CANYON Cost-of-Service Analysis

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 23 : METER EQUIVALENCY FACTORS USED IN FIXED CHARGES CALCULATION Meter
Capacity
Equivalency
to 3/4 inch
5/8 inch 20 1.00
3/4 inch 30 1.00
1 inch 50 1.67

1.5 inch 100 3.33
2 inch 160 5.33
3 inch 320 10.67
4 inch 500 16.67
6 inch 1,000 33.33
8 inch 1,600 53.33
10 inch 4,200 140.00
12 inch 5,300 176.67

1. Per AWWA, M1 Manual, Table B-1.

Turbine Class II Meters
Meter Size
Standard Meters
Displacement Meters
Compound Class I Meters
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW- COSA, 16 of 21154 CITY OF AMERICAN CANYON Cost-of-Service Analysis

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 24 : ALLOCATION OF RECYCLED WATER REVENUE REQUIREMENTS Variable (Collected from Vol. Rates) $ 437,442 $ 650,684 80% $ 256,030 100% Fixed (Collected from Fixed Charges) 631,944 162,671 20% - 0% Net Revenue Requirement $ 1,069,386 $ 813,355 100% $ 256,030 100%

1. For calculation, see the RW - Funct. & Classification tab.

TABLE 25 : ALLOCATION OF NET REVENUE REQUIREMENTS - FY 2023/24 Recycled Water
Delivered 136,134 458 100.0% $ 650,684 $ 162,671 $ 813,355 $4.78 $29.58 Self-Haul 136,134 0 0.0% 256,030 - 256,030 $1.88 n/a
Total Net Revenue Requirement 272,268 458 0.0% $ 256,030 $ - $ 256,030 -- --

1. Source file: 2020 Urban Water Management Plan , Figure 6.4.

2. Number of meters by size times the hydraulic capacity factor for each meter size. Source: AWWA, Manual M1, Table B-1 & AWWA, Manual M6, Table 5-3.

3. Total Variable Costs times the proportional share of annual RW consumption.

4. Fixed costs times the percent of equivalent meters.

5. Total Variable Costs divided by Total Annual RW Consumption.

6. Total Fixed Costs divided by total Equivalent Meters. This provides the basis for monthly fixed charges for each meter size.

TABLE 26 : CALCULATION OF MONTHLY FIXED METER SERVICE CHARGES FOR FY 2023/24 Total
< 1" meter 1" meter 1 1/2" meter 2" meter 3" meter 4" meter 6" meter 8" meter Recycled Water
Delivered 2 13 14 28 13 6 0 0 76
Total Meters/Accounts 2 13 14 28 13 6 0 0 76
Hydraulic Capacity Factor 21.00 1.67 3.33 5.33 10.67 16.67 33.33 53.33 Total Equivalent Meters 2 22 47 149 139 100 0 0 458
Monthly Fixed Service Charges
Fixed Charge ($/EM/month)3
$29.58 $29.58 $29.58 $29.58 $29.58 $29.58 $29.58 $29.58 Fixed Monthly Charge $29.58 $49.29 $98.59 $157.74 $315.48 $492.94 $985.89 $1,577.42 Annual Fixed Costs Allocated to Monthly Meter Charges
Total Revenue from RW Meter Charges $ 710 $ 7,690 $ 16,563 $ 53,001 $ 49,215 $ 35,492 $ - $ - $ 162,671

1. Meter by Class and Size are based on June 2022 customer billing data.

2. Source: Principles of Water Rates, Fees, and Charges , Manual M1, AWWA, Table B-1.

3. Cost per month per equivalent meter. Monthly fixed charges are set for each meter size using the hydraulic capacity factors and total equivalent meters.

RW Fixed
Charges
($/Eq. Meter/
Month) 6
Annual RW
Consumption1
Equivalent Meters2
Variable
Costs3
Fixed
Costs4
Net Revenue
Req'ts No. of Equiv.

Meters
% of Equiv.

Meters
RW
Volumetric
Rate ($/hcf)5
Number of RW Meters
by Class and Size1
FY 2023/24
Recycled Water Customers
Cost Allocation Factors Cost Classifications
Net Revenue Requirements -
Delivered (2023/24)
Net Revenue Requirements -
Self-Haul(2023/24) Total
Recycled Water 1
Classification Components
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW- COSA (2), 17 of 21155 CITY OF AMERICAN CANYON Cost-of-Service Analysis

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 27 : METER EQUIVALENCY FACTORS USED IN FIXED CHARGES CALCULATION Meter
Capacity
Equivalency
to 3/4 inch
5/8 inch 20 1.00
3/4 inch 30 1.00
1 inch 50 1.67

1.5 inch 100 3.33
2 inch 160 5.33
3 inch 320 10.67
4 inch 500 16.67
6 inch 1,000 33.33
8 inch 1,600 53.33
10 inch 4,200 140.00
12 inch 5,300 176.67

1. Per AWWA, M1 Manual, Table B-1.

Turbine Class II Meters
Meter Size
Standard Meters
Displacement Meters
Compound Class I Meters
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW- COSA (2), 18 of 21156 CITY OF AMERICAN CANYON Current vs. Proposed Rates

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 28 : CURRENT VS. PROPOSED RATES
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Projected Increase in Rate Revenue per Financial Plan: 250.00% 10.00% 10.00% 5.00% 5.00% Monthly Fixed Service Charges (in $/mo) - Delivered Only < 1" meter $26.56 $29.58 $32.53 $35.79 $37.58 $39.46
1" meter $44.42 $49.29 $54.22 $59.65 $62.63 $65.76
1 1/2" meter $88.75 $98.59 $108.45 $119.29 $125.26 $131.52 2" meter $141.99 $157.74 $173.52 $190.87 $200.41 $210.43 3" meter $283.98 $315.48 $347.03 $381.73 $400.82 $420.86 4" meter $443.74 $492.94 $542.24 $596.46 $626.28 $657.60 6" meter $887.48 $985.89 $1,084.47 $1,192.92 $1,252.57 $1,315.20 8" meter $1,420.06 $1,577.42 $1,735.16 $1,908.67 $2,004.11 $2,104.31 Commodity Charges for All Water Consumed (in $/hcf)
Variable Charge - Delivered $0.90 $4.78 $5.26 $5.78 $6.07 $6.38 Variable Charge - Self-Haul n/a $1.88 $2.07 $2.28 $2.39 $2.51

PROPOSED ALTERNATIVE
Recycled Water Rate Schedule Current
Rates
Proposed Rates
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Current & Prop. Rates (2), 19 of 21157 CITY OF AMERICAN CANYON Current vs. Proposed Rates

RECYCLED WATER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 29 : CURRENT VS. PROPOSED RATES
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Projected Increase in Rate Revenue per Financial Plan: 250.00% 10.00% 10.00% 5.00% 5.00% Monthly Fixed Service Charges (in $/mo)
< 1" meter $26.56 $38.89 $42.78 $47.05 $49.41 $51.88
1" meter $44.42 $64.81 $71.29 $78.42 $82.34 $86.46
1 1/2" meter $88.75 $129.62 $142.58 $156.84 $164.69 $172.92 2" meter $141.99 $207.40 $228.14 $250.95 $263.50 $276.67 3" meter $283.98 $414.79 $456.27 $501.90 $526.99 $553.34 4" meter $443.74 $648.11 $712.92 $784.22 $823.43 $864.60 6" meter $887.48 $1,296.23 $1,425.85 $1,568.43 $1,646.85 $1,729.20 8" meter $1,420.06 $2,073.96 $2,281.36 $2,509.49 $2,634.97 $2,766.71 Commodity Charges for All Water Consumed (in $/hcf)
Variable Charge $0.90 $3.14 $3.46 $3.80 $3.99 $4.19
Variable Charge - Self-Haul n/a $1.88 $2.07 $2.28 $2.39 $2.51 Recycled Water Rate Schedule Current
Rates
Proposed Rates

PROPOSED ALTERNATIVE
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 RW - Current & Proposed Rates, 20 of 21158 Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Recycled Water Bill Comp, 21 of 21 $155.49 $168.99$267.99 $343.59 $366.99 $389.49 $254.53 $301.66 $647.30 $911.24 $992.94 $1,071.49 $235.61 $263.82 $470.70 $628.68 $677.58 $724.60 $0
$200
$400
$600
$800
$1,000
$1,200
15 30 140 224 250 275
Monthly Bill
Monthly Water Consumption (CCF)
Recycled Water Bill Comparison
Current vs. Proposed FY 2023/24 Rates (2" Meter)
Recycled Water Bill - Current Rates
Recycled Water Bill - Delivered
Recycled Water Bill - Self-Haul
Average
ANNUAL Bill
(140 ccf/mo.)
Average
WINTER Bill
(30 ccf/mo.)
Average
SUMMER Bill
(224 ccf/mo.)
159
Enterprise Rate Study – City of American Canyon
Prepared by NBS – February 2024 115
Appendix C. Sewer Rate Study Tables and Figures
160
CITY OF AMERICAN CANYON Financial Plan & Reserve Summary

SEWER RATE STUDY
Financial Plan and Reserve Projections
TABLE 1 : FINANCIAL PLAN AND SUMMARY OF REVENUE REQUIREMENTS Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Sources of Funds 1
Rate Revenue:

Sewer Rate Revenue $ 4,824,937 $ 4,940,178 $ 5,042,690 $ 5,128,416 $ 5,215,599 $ 5,304,264 $ 5,394,436 $ 5,486,142 $ 5,573,920 $ 5,663,103 $ 5,753,713 $ 5,845,772 Other Revenue 82,867 171,545 98,593 100,269 101,974 103,707 105,470 107,263 108,979 110,723 112,495 114,295 Interest Earnings 28,277 166,693 120,000 22,911 22,211 24,657 21,576 24,547 25,380 26,255 27,142 28,071 Total: Sources of Funds $ 4,936,080 $ 5,278,416 $ 5,261,283 $ 5,251,596 $ 5,339,784 $ 5,432,629 $ 5,521,483 $ 5,617,952 $ 5,708,280 $ 5,800,081 $ 5,893,350 $ 5,988,138 Uses of Water Funds
Operating Expenses:
570 - Wastewater Treatment Plant $ 3,075,847 $ (1,723,127) $ 1,952,137 $ 2,041,362 $ 2,121,194 $ 4,663,008 $ 2,291,046 $ 2,381,374 $ 2,475,521 $ 2,573,662 $ 2,675,976 $ 2,782,656 575 - Wastewater Collections 509,518 1,181,331 835,861 873,335 902,822 933,308 964,830 997,421 1,031,118 1,065,960 1,101,985 1,139,234 585 - Wastewater Environmental Compliance 414,090 489,734 856,655 887,901 915,994 944,981 974,890 1,005,750 1,037,594 1,070,451 1,104,354 1,139,337 810 - Non Departmental 1,820,335 2,157,776 2,615,743 2,700,825 2,783,879 2,869,503 2,957,779 3,048,788 3,142,618 3,239,356 3,339,093 3,441,923 Subtotal: Operating Expenses $ 5,819,790 $ 2,105,714 $ 6,260,396 $ 6,503,425 $ 6,723,889 $ 9,410,800 $ 7,188,544 $ 7,433,334 $ 7,686,851 $ 7,949,428 $ 8,221,408 $ 8,503,149 Other Expenditures:

Existing Debt Service $ 1,115,315 $ 206,640 $ 215,074 $ 223,856 $ 224,168 $ 239,297 $ 249,385 $ 222,191 $ 231,597 $ 241,391 $ 249,843 $ 259,060 Future Debt Service - - - - - - - - - - - -
Rate-Funded Capital Expenses 345,549 3,201,161 2,573,447 197,942 1,111,368 14,992 2,230,867 1,406,839 332,901 - - - Subtotal: Other Expenditures $ 1,460,864 $ 3,407,800 $ 2,788,521 $ 421,799 $ 1,335,536 $ 254,288 $ 2,480,251 $ 1,629,030 $ 564,498 $ 241,391 $ 249,843 $ 259,060 Total: Uses of Funds $ 7,280,654 $ 5,513,515 $ 9,048,917 $ 6,925,223 $ 8,059,425 $ 9,665,088 $ 9,668,795 $ 9,062,364 $ 8,251,349 $ 8,190,819 $ 8,471,251 $ 8,762,209 Plus: Revenue from Rate Increases2 - - 630,336 1,923,156 3,077,203 4,141,569 4,755,735 4,836,583 4,913,968 4,992,591 5,072,473 5,153,633 Annual Surplus/(Deficit) $ (2,344,574) $ (235,099) $ (3,157,298) $ 249,528 $ 357,562 $ (90,890) $ 608,423 $ 1,392,171 $ 2,370,899 $ 2,601,853 $ 2,494,572 $ 2,379,561 Net Revenue Reqt. (Total Uses less Non-Rate Revenue) $ 7,169,511 $ 5,175,276 $ 8,830,324 $ 6,802,043 $ 7,935,240 $ 9,536,723 $ 9,541,748 $ 8,930,554 $ 8,116,989 $ 8,053,841 $ 8,331,613 $ 8,619,843 Total Rate Revenue After Rate Increases $ 4,824,937 $ 4,940,178 $ 6,303,363 $ 7,692,624 $ 8,762,206 $ 9,980,503 $ 10,150,172 $ 10,322,725 $ 10,487,888 $ 10,655,694 $ 10,826,185 $ 10,999,404 Projected Annual Rate Revenue Increase 0.00% 0.00% 25.00% 20.00% 12.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Cumulative Increase from Annual Revenue Increases 0.00% 0.00% 25.00% 50.00% 68.00% 88.16% 88.16% 88.16% 88.16% 88.16% 88.16% 88.16% Debt Coverage After Rate Increase N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

1. Revenue and expenses for FY 2021/22 through FY 2023/24 provided by the City. Source files: Fund 540 Wastewater Operations & Fund 510 - 580 FY 23-24 Budget Status as of 09-19-2023 .

2. Revenue from rate increases assumes an implementation date of January 1, 2024. For each year thereafter, the assumption is that new rates will be implemented on January 1st of each year.

Selection of Financial Plan Alternative 1
Financial Plan Alternatives FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 1 Alternative 1 - Full Cost Recovery Rates10.00% 0.00% 25.00% 20.00% 12.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2 Alternative 2 - Phased-in Rate Increases20.00% 0.00% 15.00% 15.00% 15.00% 15.00% 10.00% 0.00% 0.00% 0.00% 0.00% 0.00% 3 Alternative 3 - Minimal Rate Increases30.00% 0.00% 5.00% 5.00% 5.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 4 No Rate Increases 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

1. Alternative 1: Scenario 1 - Rates needed to meet all revenue requirements and meet the target reserve levels (Large increase followed by smaller increases).

2. Alternative 2: Scenario 2 - Large increases phased In over two years, followed by smaller increases (Reserves drop below target level).

3. Alternative 3: Scenario 3 - Smaller increases (Reserves drop below target level).

RATE REVENUE REQUIREMENTS SUMMARY
5-Year Projected Rate Period Projected
Prepared by NBS
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SEWER RATE STUDY
Financial Plan and Reserve Projections
TABLE 2 : EXCLUDED PLEDGE SUMMARY RESERVE FUND SUMMARY
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Total Beginning Cash1 $ 8,702,214
Unrestricted Reserves:

Operating Reserve
Beginning Reserve Balance $ 8,314,998 $ 7,733,712 $ 5,200,513 $ 1,677,226 $ 1,626,000 $ 1,805,087 $ 1,579,529 $ 1,797,000 $ 1,858,000 $ 1,922,000 $ 1,987,000 $ 2,055,000 Plus: Net Cash Flow (After Rate Increases) (2,344,574) (235,099) (3,157,298) 249,528 357,562 (90,890) 608,423 1,392,171 2,370,899 2,601,853 2,494,572 2,379,561 Plus: Transfer of Debt Reserve Surplus - - - - - - - - - - - - Plus: Interest Earnings 113,583 193,343 130,013 22,911 22,211 24,657 21,576 24,547 25,380 26,255 27,142 28,071 Less: Transfer out to Capacity Fee Reserve (Interfund Loan) - (159,325) (159,325) (159,325) (159,325) (159,325) (159,325) (159,325) (159,325) (159,325) (159,325) - Less: Transfer Out to Capital Replacement Reserve (4,629,007) (4,904,642) (336,678) (164,341) (41,362) - (253,205) (1,196,393) (2,172,955) (2,403,783) (2,294,390) (2,336,632) Ending Operating Reserve Balance $ 1,455,000 $ 2,627,989 $ 1,677,226 $ 1,626,000 $ 1,805,087 $ 1,579,529 $ 1,797,000 $ 1,858,000 $ 1,922,000 $ 1,987,000 $ 2,055,000 $ 2,126,000 Target Ending Balance (90 days of O&M) 2 $ 1,455,000 $ 526,000 $ 1,565,000 $ 1,626,000 $ 1,681,000 $ 2,353,000 $ 1,797,000 $ 1,858,000 $ 1,922,000 $ 1,987,000 $ 2,055,000 $ 2,126,000 Capital Rehabilitation & Replacement Reserve
Beginning Reserve Balance $ 387,216 $ 145,027 $ 546,284 $ 882,962 $ 1,047,302 $ 1,088,664 $ 1,088,664 $ 1,341,869 $ 2,527,393 $ 3,580,955 $ 4,447,200 $ 5,116,353 Plus: Grant Proceeds - - - - - - - - - - - -
Plus: Transfer of Operating Reserve Surplus 4,629,007 4,904,642 336,678 164,341 41,362 - 253,205 1,196,393 2,172,955 2,403,783 2,294,390 2,336,632 Less: Use of Reserves for Capital Projects - - - - - - - (10,869) (1,119,393) (1,537,538) (1,625,237) (1,715,751) Ending Capital Rehab & Replacement Reserve Balance $ 5,016,223 $ 5,049,669 $ 882,962 $ 1,047,302 $ 1,088,664 $ 1,088,664 $ 1,341,869 $ 2,527,393 $ 3,580,955 $ 4,447,200 $ 5,116,353 $ 5,737,234 Target Ending Balance (3% of Assets) 3 $ 759,000 $ 852,000 $ 936,000 $ 968,000 $ 1,060,000 $ 1,156,000 $ 1,255,000 $ 1,331,000 $ 1,408,000 $ 1,487,000 $ 1,569,000 $ 1,655,000 Ending Cash Balance - Excl. Restricted Reserves $ 6,471,223 $ 7,677,658 $ 2,560,188 $ 2,673,302 $ 2,893,751 $ 2,668,194 $ 3,138,869 $ 4,385,393 $ 5,502,955 $ 6,434,200 $ 7,171,353 $ 7,863,234 Min. Target Ending Cash Balance -Excl. Restricted Reserves $ 2,214,000 $ 1,378,000 $ 2,501,000 $ 2,594,000 $ 2,741,000 $ 3,509,000 $ 3,052,000 $ 3,189,000 $ 3,330,000 $ 3,474,000 $ 3,624,000 $ 3,781,000 Ending Surplus/(Deficit) Compared to Reserve Targets $ 4,257,223 $ 6,299,658 $ 59,188 $ 79,302 $ 152,751 $ (840,806) $ 86,869 $ 1,196,393 $ 2,172,955 $ 2,960,200 $ 3,547,353 $ 4,082,234 Days Cash on Hand 384 529 106 146 135 104 122 182 251 296 319 338 Annual Interest Earnings Rate 4 1.37% 2.50% 2.50% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37% 1.37%

1. Beginning cash balance for FY 2021/22 and FY 2022/23 provided by City staff. Source file: Cash Balances - Enterprise Funds.xlsx .

2. The Operating Reserve target is set equal to 3 months, or 90 days, of operating expenditures.

3. The Capital Rehabilitation & Replacement Reserve target is set to 3% of net assets. Source files: 8 - City of American Canyon Annual Report FYE 2021.pdf , page 51.

SUMMARY OF CASH ACTIVITY

SEWER FUND RESERVES
5-Year Projected Rate Period Projected
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SEWER RATE STUDY
Financial Plan Charts
CHART 1
$.0 Mil
$2.0 Mil
$4.0 Mil
$6.0 Mil
$8.0 Mil
$10.0 Mil
$12.0 Mil
2022 2023 2024 2025 2026 2027 2028
Annual Obligations
Fiscal Year Ending June 30
Sewer Revenue Requirements vs.

Revenue Under Existing and Increased Rates
Debt Service
Rate Funded Capital Expenses
Reserve Funded Capital Expenses
O&M Expenses
Revenues under Existing Rates
Revenues under Increased Rates
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Charts and Tables, 3 of 37163
CITY OF AMERICAN CANYON Charts & Tables

SEWER RATE STUDY
Financial Plan Charts
CHART 2
$.0 Mil
$1.0 Mil
$2.0 Mil
$3.0 Mil
$4.0 Mil
$5.0 Mil
$6.0 Mil
$7.0 Mil
$8.0 Mil
$9.0 Mil
$10.0 Mil
2022 2023 2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Ending Cash Balances vs.

Recommended Reserve Targets
Sewer Fund - Unrestricted Reserves
Ending Cash Balance Minimum Target Reserve Balance
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Charts and Tables, 4 of 37164
CITY OF AMERICAN CANYON Charts & Tables

SEWER RATE STUDY
Financial Plan Charts
CHART 3

25.00%

20.00%

12.00% 12.00%

0.00%
0%
5%
10%
15%
20%
25%
30%
2024 2025 2026 2027 2028
Fiscal Year Ending June 30
Projected Increases to Rate Revenue
Prepared by NBS
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Charts and Tables, 5 of 37165
CITY OF AMERICAN CANYON Charts & Tables

SEWER RATE STUDY
Financial Plan Charts
CHART 4
$2.9 Mil
$1.1 Mil
$3.2 Mil
$3.3 Mil
$3.4 Mil
$2.6 Mil
$2.6 Mil
$2.7 Mil
$2.8 Mil
$2.9 Mil
$.0 Mil.
$.5 Mil.
$1.0 Mil.
$1.5 Mil.
$2.0 Mil.
$2.5 Mil.
$3.0 Mil.
$3.5 Mil.
$4.0 Mil.
$4.5 Mil.
$5.0 Mil.
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
City of American Canyon
Capital Improvement Projects
5-Year Project Rate Period
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Charts and Tables, 6 of 37166
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 3 : REVENUE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Rate Revenue
Sewer Service Charge 1 $ 4,824,937 $ 4,940,178 $ 5,042,690 $ 5,128,416 $ 5,215,599 $ 5,304,264 $ 5,394,436 $ 5,486,142 $ 5,573,920 $ 5,663,103 $ 5,753,713 $ 5,845,772 Other Revenue
Misc. Revenues - Other 1 17,936 89,761 8,593 8,739 8,888 9,039 9,192 9,349 9,498 9,650 9,805 9,961 Late Penalties / Interest 1 64,931 81,785 90,000 91,530 93,086 94,668 96,278 97,915 99,481 101,073 102,690 104,333 Interest Income See FP 28,277 166,693 120,000 - - - - - - - - - Capacity Fee Revenue
Capacity Fees 1 573,335 235,879 835,413 4,563,228 508,500 517,145 525,936 534,877 543,435 552,130 560,964 569,939 Interfund Transfer In (Loan Repayment) 8 - - - - 453,816 453,816 453,816 453,816 453,816 453,816 453,816 453,816 Interest Income See FP 26,256 157,984 136,186 198,000 - - - - - - - - TOTAL: REVENUE $ 5,535,672 $ 5,672,278 $ 6,232,882 $ 9,989,913 $ 6,279,888 $ 6,378,931 $ 6,479,658 $ 6,582,098 $ 6,680,150 $ 6,779,771 $ 6,880,987 $ 6,983,822 TABLE 4 : REVENUE SUMMARY
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Rate Revenue
Sewer Service Charge $ 4,824,937 $ 4,940,178 $ 5,042,690 $ 5,128,416 $ 5,215,599 $ 5,304,264 $ 5,394,436 $ 5,486,142 $ 5,573,920 $ 5,663,103 $ 5,753,713 $ 5,845,772 Other Revenue
Interest Income 28,277 166,693 120,000 - - - - - - - - - Other Revenue 82,867 171,545 98,593 100,269 101,974 103,707 105,470 107,263 108,979 110,723 112,495 114,295 Capacity Fee Revenue
Capacity Fees 573,335 235,879 835,413 4,563,228 508,500 517,145 525,936 534,877 543,435 552,130 560,964 569,939 Interfund Transfer In (Loan Repayment) - - - - 453,816 453,816 453,816 453,816 453,816 453,816 453,816 453,816 Interest Income 26,256 157,984 136,186 198,000 - - - - - - - - TOTAL: REVENUE $ 5,535,672 $ 5,672,278 $ 6,232,882 $ 9,989,913 $ 6,279,888 $ 6,378,931 $ 6,479,658 $ 6,582,098 $ 6,680,150 $ 6,779,771 $ 6,880,987 $ 6,983,822

DESCRIPTION
DESCRIPTION Basis
5-Year Projected Rate Period
5-Year Projected Rate Period
Basis Projected
Projected
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Exhibit 1 (O&M), 7 of 37 167
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 5 : OPERATING EXPENSE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Fund 540 - Wastewater Operations
570 - Wastewater Treatment Plant
Wages - Full time 3 $ 495,550 $ 554,877 $ 602,884 $ 633,028 $ 655,184 $ 678,115 $ 701,849 $ 726,414 $ 751,839 $ 778,153 $ 805,388 $ 833,577 Wages - Overtime 3 13,725 27,777 - - - - - - - - - -
Health Insurance 3 58,890 74,134 77,250 81,112 83,951 86,889 89,931 93,078 96,336 99,708 103,197 106,809 Health-In-Lieu 3 3,200 - 6,840 7,182 7,433 7,694 7,963 8,242 8,530 8,829 9,138 9,457 Cafeteria Plan Section 125 3 18,409 19,246 21,712 22,798 23,596 24,422 25,277 26,161 27,077 28,025 29,006 30,021 Social Security & Medicare 3 8,120 9,039 9,156 9,614 9,950 10,298 10,659 11,032 11,418 11,818 12,231 12,659 Worker Comp Insurance 3 32,204 29,763 39,875 41,869 43,334 44,851 46,421 48,045 49,727 51,467 53,269 55,133 Benefits - Other 3 - 280 1,135 1,192 1,233 1,276 1,321 1,367 1,415 1,465 1,516 1,569 Info Tech Support Services 2 7,478 5,486 73,500 75,705 77,976 80,315 82,725 85,207 87,763 90,396 93,108 95,901 Professional Services 2 34,840 52,991 187,138 192,752 198,535 204,491 210,625 216,944 223,453 230,156 237,061 244,173 Temp Agency Services 2 - 1,066 - - - - - - - - - -
Misc. Contractual Services 2 8,911 8,380 17,900 18,437 18,990 19,560 20,147 20,751 21,374 22,015 22,675 23,355 General Repairs & Maint 2 307,866 145,560 201,500 207,545 213,771 220,184 226,790 233,594 240,602 247,820 255,254 262,912 Postage/Mail/Copy/Printing Svc 2 759 254 1,000 1,030 1,061 1,093 1,126 1,159 1,194 1,230 1,267 1,305 Membership Dues & Subscription 2 21,708 1,315 12,700 13,081 13,473 13,878 14,294 14,723 15,164 15,619 16,088 16,571 Conferences - Training 2 3,357 1,440 14,500 14,935 15,383 15,845 16,320 16,809 17,314 17,833 18,368 18,919 Rentals - Equipment/Space 2 4,193 7,848 11,600 11,948 12,306 12,676 13,056 13,448 13,851 14,267 14,695 15,135 Office Supplies 2 4,298 4,668 4,000 4,120 4,244 4,371 4,502 4,637 4,776 4,919 5,067 5,219 Operating Supplies 2 52,947 65,278 56,000 57,680 59,410 61,193 63,028 64,919 66,867 68,873 70,939 73,067 WW Treatment Plant Membranes 2 - - - - - $2,458,636 - - - - - - Utilities - Gas & Elec 5 330,471 300,152 484,200 511,504 540,348 570,818 603,006 637,010 672,931 710,877 750,964 793,311 Util-PhonesPgrsInternetCable 5 16,694 18,326 19,000 20,071 21,203 22,399 23,662 24,996 26,406 27,895 29,468 31,129 Depreciation 2 1,561,144 1,746,613 - - - - - - - - - -
Major Equipment 2 19,460 - - - - - - - - - - -
Capital Outlay-Contra Account 2 (31,535) (4,906,869) - - - - - - - - - - PERS Retirement 3 103,159 109,251 110,247 115,760 119,811 124,005 128,345 132,837 137,486 142,298 147,279 152,433 Subtotal - Wastewater Treatment Plant $ 3,075,847 $ (1,723,127) $ 1,952,137 $ 2,041,362 $ 2,121,194 $ 4,663,008 $ 2,291,046 $ 2,381,374 $ 2,475,521 $ 2,573,662 $ 2,675,976 $ 2,782,656 DESCRIPTION Basis 5-Year Projected Rate Period Projected Prepared by NBS
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Exhibit 1 (O&M), 8 of 37 168
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 6 : OPERATING EXPENSE FORECAST1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 575 - Wastewater Collections
Wages - Full time 3 $ 268,022 $ 248,676 $ 411,834 $ 432,425 $ 447,560 $ 463,225 $ 479,438 $ 496,218 $ 513,586 $ 531,561 $ 550,166 $ 569,422 Wages - Overtime 3 7,125 1,721 5,000 5,250 5,434 5,624 5,821 6,024 6,235 6,454 6,679 6,913 Health Insurance 3 41,952 37,937 46,756 49,094 50,812 52,591 54,432 56,337 58,308 60,349 62,461 64,648 Health-In-Lieu 3 4,800 5,700 14,250 14,963 15,486 16,028 16,589 17,170 17,771 18,393 19,036 19,703 Cafeteria Plan Section 125 3 12,646 11,364 19,245 20,208 20,915 21,647 22,404 23,189 24,000 24,840 25,710 26,609 Social Security & Medicare 3 4,244 3,868 6,457 6,780 7,017 7,263 7,517 7,780 8,053 8,335 8,626 8,928 Worker Comp Insurance 3 30,604 32,837 36,753 38,591 39,941 41,339 42,786 44,283 45,833 47,438 49,098 50,816 Benefits - Other 3 1,319 1,471 1,918 2,014 2,084 2,157 2,233 2,311 2,392 2,475 2,562 2,652 Info Tech Support Services 2 302 702 94,600 97,438 100,361 103,372 106,473 109,667 112,957 116,346 119,836 123,432 Professional Services 2 - 4,425 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 Misc. Contractual Services 2 3,852 4,253 5,600 5,768 5,941 6,119 6,303 6,492 6,687 6,887 7,094 7,307 General Repairs & Maint 2 35,466 7,405 24,000 24,720 25,462 26,225 27,012 27,823 28,657 29,517 30,402 31,315 Membership Dues & Subscription 2 2,165 1,606 4,900 5,047 5,198 5,354 5,515 5,680 5,851 6,026 6,207 6,393 Conferences - Training 2 2,303 17,724 5,200 5,356 5,517 5,682 5,853 6,028 6,209 6,395 6,587 6,785 Rentals - Equipment/Space 2 - - 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 Office Supplies 2 1,121 396 15,000 15,450 15,914 16,391 16,883 17,389 17,911 18,448 19,002 19,572 Operating Supplies 2 27,795 32,450 42,100 43,363 44,664 46,004 47,384 48,805 50,270 51,778 53,331 54,931 Util-PhonesPgrsInternetCable 5 1,498 1,833 1,500 1,585 1,674 1,768 1,868 1,973 2,085 2,202 2,326 2,458 Major Equipment 2 19,460 709,259 - - - - - - - - - -
PERS Retirement 3 44,845 57,704 75,748 79,535 82,319 85,200 88,182 91,268 94,463 97,769 101,191 104,733 Subtotal - Wastewater Collections $ 509,518 $ 1,181,331 $ 835,861 $ 873,335 $ 902,822 $ 933,308 $ 964,830 $ 997,421 $ 1,031,118 $ 1,065,960 $ 1,101,985 $ 1,139,234 DESCRIPTION Basis 5-Year Projected Rate Period Projected Prepared by NBS
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Exhibit 1 (O&M), 9 of 37 169
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 7 : OPERATING EXPENSE FORECAST, cont.1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 585 - Wastewater Environmental Compliance
Wages - Full time 3 $ 175,790 $ 144,748 $ 194,374 $ 204,093 $ 211,236 $ 218,630 $ 226,282 $ 234,202 $ 242,399 $ 250,883 $ 259,664 $ 268,752 Wages - Overtime 3 - 182 500 525 543 562 582 602 624 645 668 691 Health Insurance 3 16,273 23,843 23,378 24,547 25,406 26,296 27,216 28,168 29,154 30,175 31,231 32,324 Health-In-Lieu 3 3,200 - 2,280 2,394 2,478 2,565 2,654 2,747 2,843 2,943 3,046 3,152 Cafeteria Plan Section 125 3 6,651 6,232 8,828 9,270 9,594 9,930 10,277 10,637 11,009 11,395 11,794 12,206 Social Security & Medicare 3 2,685 2,190 2,980 3,128 3,238 3,351 3,469 3,590 3,716 3,846 3,980 4,120 Worker Comp Insurance 3 5,101 11,826 18,594 19,524 20,208 20,915 21,647 22,404 23,189 24,000 24,840 25,710 Benefits - Other 3 - 559 641 673 696 721 746 772 799 827 856 886 Info Tech Support Services 2 368 - 59,650 61,440 63,283 65,181 67,137 69,151 71,225 73,362 75,563 77,830 Professional Services 2 115,883 108,682 253,000 260,590 268,408 276,460 284,754 293,296 302,095 311,158 320,493 330,108 General Repairs & Maint 2 8,426 9,674 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048 Postage/Mail/Copy.Printing Svc 2 103 6,182 13,000 13,390 13,792 14,205 14,632 15,071 15,523 15,988 16,468 16,962 Membership Dues & Subscription 2 822 11,770 12,600 12,978 13,367 13,768 14,181 14,607 15,045 15,496 15,961 16,440 Conferences - Training 2 275 7,531 21,800 22,454 23,128 23,821 24,536 25,272 26,030 26,811 27,616 28,444 Regulatory Compliance Permits 2 32,062 84,279 157,300 162,019 166,880 171,886 177,043 182,354 187,824 193,459 199,263 205,241 Operating Supplies 2 14,672 20,594 27,000 27,810 28,644 29,504 30,389 31,300 32,239 33,207 34,203 35,229 Major Equipment 2 - 9,918 25,000 25,750 26,523 27,318 28,138 28,982 29,851 30,747 31,669 32,619 Intra-fund Transfer Out Wastewater 2 - - - - - - - - - - - - PERS Retirement 3 31,779 41,525 25,730 27,016 27,962 28,941 29,953 31,002 32,087 33,210 34,372 35,575 Subtotal - Wastewater Environmental Compliance $ 414,090 $ 489,734 $ 856,655 $ 887,901 $ 915,994 $ 944,981 $ 974,890 $ 1,005,750 $ 1,037,594 $ 1,070,451 $ 1,104,354 $ 1,139,337 DESCRIPTION Basis 5-Year Projected Rate Period Projected Prepared by NBS
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Exhibit 1 (O&M), 10 of 37 170
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 8 : OPERATING EXPENSE FORECAST, cont.1
Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Fund 80 - Non Departmental
810 - Non Departmental
Wages - Full time 3 $ 113,357 $ 136,471 $ 128,293 $ 134,707 $ 139,422 $ 144,302 $ 149,352 $ 154,580 $ 159,990 $ 165,590 $ 171,385 $ 177,384 Wages - Overtime 3 954 178 - - - - - - - - - -
Allowances 3 1,811 1,920 1,920 2,016 2,087 2,160 2,235 2,313 2,394 2,478 2,565 2,655 Health Insurance 3 18,856 20,840 21,244 22,306 23,087 23,895 24,731 25,596 26,492 27,420 28,379 29,373 Cafeteria Plan Section 125 3 4,228 4,452 4,312 4,528 4,686 4,850 5,020 5,196 5,378 5,566 5,761 5,962 Social Security & Medicare 3 1,747 2,069 2,038 2,139 2,214 2,292 2,372 2,455 2,541 2,630 2,722 2,817 Worker Comp Insurance 3 7,901 7,096 9,825 10,316 10,677 11,051 11,438 11,838 12,252 12,681 13,125 13,584 OPEB 3 44,764 44,160 49,726 52,213 54,040 55,931 57,889 59,915 62,012 64,183 66,429 68,754 Pension Expense 3 (163,418) 47,287 - - - - - - - - - -
Benefits - Other 3 1,371 1,421 - - - - - - - - - -
Professional Services 2 - - 100,000 103,000 106,090 109,273 112,551 115,927 119,405 122,987 126,677 130,477 Temp Agency Services 2 - - 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829 Bad Debt Expense 2 (13,591) 9,434 - - - - - - - - - -
Membership Dues & Subscription 2 197 457 1,400 1,442 1,485 1,530 1,576 1,623 1,672 1,722 1,773 1,827 Conferences - Training 2 30 - 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 Office Supplies 2 - 625 1,000 1,030 1,061 1,093 1,126 1,159 1,194 1,230 1,267 1,305 Utilities - Water 5 11,868 14,702 14,000 14,789 15,623 16,504 17,435 18,418 19,457 20,554 21,713 22,938 Intra-fund Transfer Out Wastewater 2 605,656 281,641 290,090 298,793 307,757 316,989 326,499 336,294 346,383 356,774 367,478 378,502 Transfer to Gen Fnd Support Sv 2 763,512 985,309 1,123,854 1,157,570 1,192,297 1,228,066 1,264,908 1,302,855 1,341,940 1,382,199 1,423,665 1,466,375 Transfer To General Fund - Other 2 2,394 481 - - - - - - - - - - Trans to Other Funds 2 - 17,129 - - - - - - - - - -
Services - Other 2 20,296 812 - - - - - - - - - -
Retiree Health Benefits 3 60,317 60,646 78,433 82,355 85,238 88,221 91,309 94,504 97,812 101,235 104,779 108,446 PERS Retirement 3 17,037 18,820 16,257 17,070 17,667 18,286 18,926 19,588 20,274 20,983 21,717 22,478 ISF - Bldg Maint 2 59,800 176,525 262,206 270,072 278,174 286,520 295,115 303,969 313,088 322,480 332,155 342,119 ISF - Fleet 2 138,950 106,843 163,573 168,480 173,535 178,741 184,103 189,626 195,315 201,174 207,209 213,426 ISF - Info Tech 2 93,500 194,110 237,073 244,185 251,511 259,056 266,828 274,833 283,078 291,570 300,317 309,326 ISF - Legal Services 2 28,800 24,347 99,499 102,484 105,558 108,725 111,987 115,347 118,807 122,371 126,042 129,824 Subtotal - Non Departmental $ 1,820,335 $ 2,157,776 $ 2,615,743 $ 2,700,825 $ 2,783,879 $ 2,869,503 $ 2,957,779 $ 3,048,788 $ 3,142,618 $ 3,239,356 $ 3,339,093 $ 3,441,923 GRAND TOTAL: SEWER EXPENSES $ 5,819,790 $ 2,105,714 $ 6,260,396 $ 6,503,425 $ 6,723,889 $ 9,410,800 $ 7,188,544 $ 7,433,334 $ 7,686,851 $ 7,949,428 $ 8,221,408 $ 8,503,149 5-Year Projected Rate Period Projected DESCRIPTION Basis Prepared by NBS
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Exhibit 1 (O&M), 11 of 37 171
CITY OF AMERICAN CANYON Exhibit 1 - O&M

SEWER RATE STUDY
Operating Revenue and Expenses
TABLE 9 : FORECASTING ASSUMPTIONS
Basis FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Customer Growth41 -- 1.80% 1.80% 1.70% 1.70% 1.70% 1.70% 1.70% 1.60% 1.60% 1.60% 1.60% General Cost Inflation52 -- 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Labor Cost Inflation63 -- 3.50% 5.00% 5.00% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Energy74 -- 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% 7.44% Electricty85 -- 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% 5.64% Fuel & Utilities96 -- 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% 5.24% Construction Cost Inflation10 7 -- 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% No Escalation 8 -- 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

1. Revenue and expenses for FY 2021/22 through FY 2023/24 provided by the City. Revenues and expenses for all other years are escalated based on the forecasting assumptions located in Table 9 above . Source files: Fund 540 Wastewater Operations Fund 510 - 580 FY 23-24 Budget Status as of 09-19-2023 , FY 22 Fund 550 Wastewater Cap Revenue Detail Trial Balance , FY 23 Fund 550 Wastewater Cap Revenue Detail Trial Balance, & REV EXP ACTUALS - FY22 and FY23_NBS

2. Expenses are inflated each year by the following annual inflation factor categories.

3. Customer growth is based on service area population growth through FY 2039/40. Source file: American Canyon 2015 UWMP.pdf , page 26.

4. General cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

5. Labor cost inflation is based on the 5-year average annual change in the Quarterly Census of Employment and Wages for San Francisco County, CA.

6. Energy cost inflation is based on the 5-year average annual change in the Consumer Price Index for all Urban Consumers in the San Francisco-Oakland-Hayward, CA area.

7. Electricity cost inflation is based on the 5-year average change in the Consumer Price Index for San Francisco County.

9. Construction cost Inflation is the 10-year average change in the Construction Cost Index for 2012-2022. Source: Engineering News Record website (http://enr.construction.com ).

INFLATION FACTORS3
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Exhibit 1 (O&M), 12 of 37 172
CITY OF AMERICAN CANYON Exhibit 2 - CIP

SEWER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 10 : CAPITAL FUNDING SUMMARY
CAPITAL FUNDING FORECAST Actuals Actuals
FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Grants $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Use of Capacity Fee Reserves - - 291,480 897,942 2,070,444 3,278,183 1,177,570 1,181,673 1,187,638 1,194,792 1,202,725 1,211,189 SRF Loan Funding - - - - - - - - - - - -
Use of Future Revenue Bond Proceeds - - - - - - - - - - - - Use of Capital Rehabilitation and Replacement Reserve - - - - - - - 10,869 1,119,393 1,537,538 1,625,237 1,715,751 Rate Revenue 345,549 3,201,161 2,573,447 197,942 1,111,368 14,992 2,230,867 1,406,839 332,901 - - - Total Sources of Capital Funds $ 345,549 $ 3,201,161 $ 2,864,927 $ 1,095,884 $ 3,181,812 $ 3,293,175 $ 3,408,436 $ 2,599,381 $ 2,639,932 $ 2,732,330 $ 2,827,961 $ 2,926,940 Uses of Capital Funds:

Total Project Costs $ 345,549 $ 3,201,161 $ 2,864,927 $ 1,095,884 $ 3,181,812 $ 3,293,175 $ 3,408,436 $ 2,599,381 $ 2,639,932 $ 2,732,330 $ 2,827,961 $ 2,926,940 Capital Funding Surplus (Deficiency) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

CAPITAL IMPROVEMENT PROGRAM FUNDING OPTIONS
Capital Improvement Program Funding Choice 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Effective Annual Funding Amount $ 345,549 $ 3,201,161 $ 2,864,927 $ 1,095,884 $ 3,181,812 $ 3,293,175 $ 3,408,436 $ 2,599,381 $ 2,639,932 $ 2,732,330 $ 2,827,961 $ 2,926,940 TABLE 11 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Current-Year Dollars ) 1 Project Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects
2020 Annual Pavement Management Project $ 42,008 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - TR24-0300 ARPA Rancho Del Mar Paving and Utility Improvements - - 1,334,000 - - - - - - - - - WW16-0300 SCADA Improvements - 250,000 250,000 - - - - - - - - - WW20-0100 SS4 Broadway Sewer Rehabilitation (Crawford to Poco) - 375,000 1,000,000 250,000 - - - - - - - - WW22-0100 UV Disinfection - 500,000 - - - - - - - - - - WW22-0200 Blower Replacement - 500,000 - - - - - - - - - - WW21-0400 Sanitary Sewer Manhole Rehab - 100,000 - - - - - - - - - - UM20-0100 Engie Energy Services Contract 291,856 122,618 - - - - - - - - - - Master Plan Projects - Wastewater Collection System 2
SS1 Rio Del Mar Basin $ - $ - $ - $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ - $ - $ - $ - $ - SS2 Napa Logistics and Green Island Pump Station - 1,140,700 - - - - - - - - - - SS3 Huntington Way (Rio Del Mar to W American Canyon Road) - - - - 458,000 458,000 458,000 458,000 458,000 458,000 458,000 458,000 SS5 Summerfield Project - - - - 37,000 37,000 37,000 37,000 - - - - SS6 Theresa Avenue and Los Altos Drive - - - 205,000 205,000 205,000 205,000 - - - - - SS7 Main Basin Pump Station - - - - 1,199,000 1,199,000 1,199,000 1,199,000 1,199,000 1,199,000 1,199,000 1,199,000 SS8 Broadway, Cartagena Way to Mobile Home Park Entrance - - - - 68,000 68,000 68,000 68,000 68,000 68,000 68,000 68,000 SS9 Elliott Drive south of Northampton - - - - 109,000 109,000 109,000 109,000 109,000 109,000 109,000 109,000 SS10 Broadway north of Rio Del Mar - - - - 103,000 103,000 103,000 103,000 103,000 103,000 103,000 103,000 Estimated Future Projects
Future Projects3 - - - - - -
Total: Capital Improvement Program Costs (Current-Year Dollars) $ 333,864 $ 2,988,318 $ 2,584,000 $ 955,000 $ 2,679,000 $ 2,679,000 $ 2,679,000 $ 1,974,000 $ 1,937,000 $ 1,937,000 $ 1,937,000 $ 1,937,000 5-Year Projected Rate Period Projected
Funding Sources:

Prepared by NBS
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Exhibit 2 (CIP), 13 of 37 173
CITY OF AMERICAN CANYON Exhibit 2 - CIP

SEWER RATE STUDY
Capital Improvement Plan Expenditures
TABLE 12 : CAPITAL IMPROVEMENT PROGRAM COSTS (in Future-Year Dollars ) 4 Project Description FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Capital Projects
2020 Annual Pavement Management Project $ 43,478 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - TR24-0300 ARPA Rancho Del Mar Paving and Utility Improvements - - 1,479,030 - - - - - - - - - WW16-0300SCADA Improvements - 267,806 277,179 - - - - - - - - - WW20-0100SS4 Broadway Sewer Rehabilitation - 401,709 1,108,718 286,881 - - - - - - - - WW22-0100UV Disinfection - 535,613 - - - - - - - - - -
WW22-0200Blower Replacement - 535,613 - - - - - - - - - - WW21-0400Sanitary Sewer Manhole Rehab - 107,123 - - - - - - - - - - UM20-0100 Engie Energy Services Contract 302,071 131,351 - - - - - - - - - - Master Plan Projects - Wastewater Collection System 2
SS1 Rio Del Mar Basin $ - $ - $ - $ 573,762 $ 593,843 $ 614,628 $ 636,140 $ - $ - $ - $ - $ - SS2 Napa Logistics and Green Island Pump Station - 1,221,946 - - - - - - - - - - SS3 Huntington Way - - - - 543,960 562,999 582,704 603,099 624,207 646,054 668,666 692,069 SS5 Summerfield Project - - - - 43,944 45,482 47,074 48,722 - - - - SS6 Theresa Avenue and Los Altos Drive - - - 235,242 243,476 251,997 260,817 - - - - - SS7 Main Basin Pump Station - - - - 1,424,036 1,473,877 1,525,463 1,578,854 1,634,114 1,691,308 1,750,504 1,811,771 SS8 Broadway, Cartagena Way to Mobile Home Park Entrance - - - - 80,763 83,589 86,515 89,543 92,677 95,921 99,278 102,753 SS9 Elliott Drive south of Northampton - - - - 129,458 133,989 138,678 143,532 148,556 153,755 159,137 164,706 SS10 Broadway north of Rio Del Mar - - - - 122,332 126,613 131,045 135,631 140,378 145,292 150,377 155,640 Estimated Future Projects
Future Projects3 - - - - - - - - - - - -
Total: Capital Improvement Program Costs (Future-Year Dollars) $ 345,549 $ 3,201,161 $ 2,864,927 $ 1,095,884 $ 3,181,812 $ 3,293,175 $ 3,408,436 $ 2,599,381 $ 2,639,932 $ 2,732,330 $ 2,827,961 $ 2,926,940 TABLE 13 : FORECASTING ASSUMPTIONS
Economic Variables FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33

3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% Cumulative Construction Cost Multiplier from FY 2021/22 1.04 1.07 1.11 1.15 1.19 1.23 1.27 1.32 1.36 1.41 1.46 1.51

1. Capital project costs were provided by City staff. Source files: 11. CIP Budget vs Expense Report FY 2021-2022 through Oct 2021.pdf & Wastewater FY 2023-2027.xlsx .

2. The City's Wastewater Collection System Master Plan projects were scheduled to begin in 2016; however, the study only includes costs from FY 2021/22 through FY 2034/35. Source file: 2016 Sewer Master Plan.pdf , page 52.

3. Future project costs beyond FY 2034/35 are calculated based on the City's 10-year average.

4. Capital improvement projects are inflated to future year estimated costs with ENR CCI for the region. Source: Engineering News Record website (http://enr.construction.com ).

5. For reference purposes, the annual Construction Cost Inflation percentage is the 10-year average change in the Construction Cost Index for September 2012-2022 (3.50%). Source: Engineering News Record website (http://enr.construction.com).

Annual Construction Cost Inflation, Per Engineering News Record5 Prepared by NBS
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Exhibit 2 (CIP), 14 of 37 174
CITY OF AMERICAN CANYON Exhibit 3 - Debt

SEWER RATE STUDY
Debt Service
TABLE 14 : SEWER UTILITY EXISTING DEBT OBLIGATIONS
EXISTING DEBT OBLIGATIONS Actuals Actuals
Annual Repayment Schedules: FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 City National Bank - Loan Amount $2,004,2001
Principal Payment $ 155,243 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Interest Payment 1,979 - - - - - - - - - - -
Subtotal: Annual Debt Service $ 157,222 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Coverage Requirement ($-Amnt above annual payment)2 $ 180,805 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement (total fund balance)2$ 157,222 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - SWRCB: Project No. C-06-4666-110 & Agreement No. 99819-550-03 Principal Payment $ 722,377 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Interest Payment - - - - - - - - - - - -
Other Charges 19,504 - - - - - - - - - - -
Subtotal: Annual Debt Service $ 741,881 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Coverage Requirement ($-Amnt above annual payment) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement (total fund balance) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Bank of America Public Capital Corp Agreement (ENGIE) - Loan Amount $5,209,2094 Principal Payment $ 161,088 $ 154,345 $ 165,634 $ 177,478 $ 180,996 $ 199,515 $ 213,287 $ 189,719 $ 202,626 $ 216,158 $ 228,580 $ 241,999 Interest Payment 55,123 52,295 49,440 46,378 43,173 39,781 36,097 32,472 28,971 25,233 21,262 17,061 Subtotal: Annual Debt Service $ 216,211 $ 206,640 $ 215,074 $ 223,856 $ 224,168 $ 239,297 $ 249,385 $ 222,191 $ 231,597 $ 241,391 $ 249,843 $ 259,060 Coverage Requirement ($-Amnt above annual payment) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve Requirement (total fund balance) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Grand Total: Existing Annual Debt Service $ 1,115,315 $ 206,640 $ 215,074 $ 223,856 $ 224,168 $ 239,297 $ 249,385 $ 222,191 $ 231,597 $ 241,391 $ 249,843 $ 259,060 Grand Total: Existing Annual Coverage Requirement $ 180,805 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Grand Total: Existing Debt Reserve Target $ 157,222 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - 5-Year Projected Rate Period Projected
Prepared by NBS
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Exhibit 3 (Debt), 15 of 37 175
CITY OF AMERICAN CANYON Exhibit 3 - Debt

SEWER RATE STUDY
Debt Service
TABLE 15 : SEWER UTILITY EXISTING DEBT OBLIGATIONS, cont.

EXISTING DEBT OBLIGATIONS Actuals Actuals
Annual Repayment Schedules: FY 2021/22 FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 FY 2032/33 Interfund Loans (For information only )
Wastewater Capacity to Wastewater Fund
Advance from WW Capacity 550 to Wastewater Operations 540 Original Loan Amount (December 1, 2008) $ 1,285,000
Interest (for budget purposes only) 146,147
Annual Debt Service5 $159,325 $159,325 $159,325 $159,325 $159,325 $159,325 $159,325 $159,325 $159,325 $159,325 $ - Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (March 11, 2011) $ 1,070,000
Interest (for budget purposes only) 205,869
Annual Debt Service6 $ - $ - $ - $99,295 $99,295 $99,295 $99,295 $99,295 $99,295 $99,295 $99,295 Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (December 15, 2009) $ 304,614
Interest (for budget purposes only) 58,577
Annual Debt Service7 $ - $ - $ - $ 28,266 $ 28,266 $ 28,266 $ 28,266 $ 28,266 $ 28,266 $ 28,266 $ 28,266 Wastewater Capacity to Recycled Water Fund
Advance from WW Capacity 550 to Recycled Water Operations 580 Original Loan Amount (December 15, 2009) $ 3,532,410
Interest (for budget purposes only) 659,727
Annual Debt Service8 $ - $ - $ - $ 326,255 $ 326,255 $ 326,255 $ 326,255 $ 326,255 $ 326,255 $ 326,255 $ 326,255

1. Loan originally issued between Municipal Finance Corporation, City National Bank, and the City of American Canyon. Source files: 5 - Debt Service Schedules.xlsx & 6 - Wastewater Membrane Agreement.pdf .

2. Coverage and reserve requirements were provided by the City. Source files: 6 - Wastewater Membrane Agreement.pdf , pages 9 & 12.

3. State Revolving Fund Loan issued in September 1999 in that amount of $10,859,470. Source file: 6 - SWRCB Agreement 99-819-550-0 4666-110 Executed Amendment #2_11-12-14.pdf .

4. Equipment lease/purchase loan issued by Bank of America for equipment upgrades, replacements and installation to provide energy savings for the City. Sewer utility portion is 59.43%, or $3,095,832.91 (Principal).

Source file: 6 - ENGIE Closing Documents.pdf .

5. Funds advanced for capital projects. Repayment scheduled to begin FY 2022/23.

6. Funds advanced for Green Island Recycled Waterline Project. Repayment scheduled to begin FY 2025/26.

7. Funds advance for Recycled Water Pump Station Upgrade. Repayment scheduled to begin FY 2025/26.

8. Funds advanced for various CIP projects. Repayment scheduled to begin FY 2025/26.

TABLE 16 : EXISTING ANNUAL DEBT OBLIGATIONS TO BE SATISFIED BY SEWER RATES Annual Obligations 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Existing Annual Debt Service $ 1,115,315 $ 206,640 $ 215,074 $ 223,856 $ 224,168 $ 239,297 $ 249,385 $ 222,191 $ 231,597 $ 241,391 $ 249,843 $ 259,060 Existing Annual Coverage Requirement $ 180,805 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Existing Debt Reserve Target $ 157,222 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - 5-Year Projected Rate Period Projected
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Exhibit 3 (Debt), 16 of 37 176
CITY OF AMERICAN CANYON Exhibit 4 - Current Rates

SEWER RATE STUDY
Projected Sewer Rates Under Existing Rate Schedule
TABLE 17 : CURRENT SEWER RATE SCHEDULE
Single-Family Residential - Monthly Fixed Service Charges Low Winter Water Use 4 units or less $56.79
Average Winter Water Use (Standard) 4.1 – 13 units $60.48 High Winter Water Use 13.01 units and above $62.65
All Other Monthly Fixed Service Charges
Multi-Family Residential Per Dwelling Unit $45.36
Commercial Whichever is greater $60.48 or $5.40 per unit

1. Sewer rates are set according to the average monthly water use for January to March of the previous calendar year. New customers are charged at the average winter use rate (standard) and adjusted the following year, if applicable.

Sewer Rate Schedule1 Current Rates
Jan. 1, 2023
Description
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www.nbsgov.com | Toll-Free: 800.676.7516 Exhibit 4 (Current Rates), 17 of 37177 CITY OF AMERICAN CANYON Functionalization & Classification

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 18 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (VOL) (BOD) (TSS) (CA) (VOL) (BOD) (TSS) (CA) Fund 540 - Wastewater Operations
570 - Wastewater Treatment Plant
Wages - Full time $ 602,884 $ 307,471 $ 132,634 $ 132,634 $ 30,144 51% 22% 22% 5% Health Insurance 77,250 39,397 16,995 16,995 3,862 51% 22% 22% 5% Health-In-Lieu 6,840 3,488 1,505 1,505 342 51% 22% 22% 5% Cafeteria Plan Section 125 21,712 11,073 4,777 4,777 1,086 51% 22% 22% 5% Social Security & Medicare 9,156 4,669 2,014 2,014 458 51% 22% 22% 5% Worker Comp Insurance 39,875 20,336 8,772 8,772 1,994 51% 22% 22% 5% Benefits - Other 1,135 579 250 250 57 51% 22% 22% 5%
Info Tech Support Services 73,500 37,485 16,170 16,170 3,675 51% 22% 22% 5% Professional Services 187,138 95,440 41,170 41,170 9,357 51% 22% 22% 5% Misc. Contractual Services 17,900 9,129 3,938 3,938 895 51% 22% 22% 5% General Repairs & Maint 201,500 102,765 44,330 44,330 10,075 51% 22% 22% 5% Postage/Mail/Copy/Printing Svc 1,000 510 220 220 50 51% 22% 22% 5% Membership Dues & Subscription 12,700 6,477 2,794 2,794 635 51% 22% 22% 5% Conferences - Training 14,500 7,395 3,190 3,190 725 51% 22% 22% 5% Rentals - Equipment/Space 11,600 5,916 2,552 2,552 580 51% 22% 22% 5% Office Supplies 4,000 2,040 880 880 200 51% 22% 22% 5%
Operating Supplies 56,000 28,560 12,320 12,320 2,800 51% 22% 22% 5% WW Treatment Plant Membranes - - - - - 51% 22% 22% 5%
Utilities - Gas & Elec 484,200 246,942 106,524 106,524 24,210 51% 22% 22% 5% Util-PhonesPgrsInternetCable 19,000 9,690 4,180 4,180 950 51% 22% 22% 5% PERS Retirement 110,247 56,226 24,254 24,254 5,512 51% 22% 22% 5% Subtotal - Wastewater Treatment Plant $ 1,952,137 $ 995,590 $ 429,470 $ 429,470 $ 97,607 51% 22% 22% 5% Strength Customer Basis of Classification Budget Categories Total Revenue
Requirements
Flow
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Funct. & Classification, 18 of 37178
CITY OF AMERICAN CANYON Functionalization & Classification

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 19 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (VOL) (BOD) (TSS) (CA) (VOL) (BOD) (TSS) (CA) Fund 540 - Wastewater Operations
575 - Wastewater Collections
Wages - Full time $ 411,834 $ 411,834 $ - $ - $ - 100% 0% 0% 0% Wages - Overtime 5,000 5,000 - - - 100% 0% 0% 0%
Health Insurance 46,756 46,756 - - - 100% 0% 0% 0%
Health-In-Lieu 14,250 14,250 - - - 100% 0% 0% 0%
Cafeteria Plan Section 125 19,245 19,245 - - - 100% 0% 0% 0% Social Security & Medicare 6,457 6,457 - - - 100% 0% 0% 0% Worker Comp Insurance 36,753 36,753 - - - 100% 0% 0% 0% Benefits - Other 1,918 1,918 - - - 100% 0% 0% 0%
Info Tech Support Services 94,600 94,600 - - - 100% 0% 0% 0% Professional Services 20,000 20,000 - - - 100% 0% 0% 0% Misc. Contractual Services 5,600 5,600 - - - 100% 0% 0% 0% General Repairs & Maint 24,000 24,000 - - - 100% 0% 0% 0% Membership Dues & Subscription 4,900 4,900 - - - 100% 0% 0% 0% Conferences - Training 5,200 5,200 - - - 100% 0% 0% 0%
Rentals - Equipment/Space 5,000 5,000 - - - 100% 0% 0% 0% Office Supplies 15,000 15,000 - - - 100% 0% 0% 0%
Operating Supplies 42,100 42,100 - - - 100% 0% 0% 0%
Util-PhonesPgrsInternetCable 1,500 1,500 - - - 100% 0% 0% 0% PERS Retirement 75,748 75,748 - - - 100% 0% 0% 0%
Subtotal - Wastewater Collections $ 835,861 $ 835,861 $ - $ - $ - 100% 0% 0% 0% Strength Customer Basis of Classification Budget Categories Total Revenue
Requirements
Flow
Prepared by NBS
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Funct. & Classification, 19 of 37179
CITY OF AMERICAN CANYON Functionalization & Classification

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 20 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (VOL) (BOD) (TSS) (CA) (VOL) (BOD) (TSS) (CA) Fund 540 - Wastewater Operations
585 - Wastewater Environmental Compliance
Wages - Full time $ 194,374 $ 99,131 $ 42,762 $ 42,762 $ 9,719 51% 22% 22% 5% Wages - Overtime 500 255 110 110 25 51% 22% 22% 5%
Health Insurance 23,378 11,923 5,143 5,143 1,169 51% 22% 22% 5% Health-In-Lieu 2,280 1,163 502 502 114 51% 22% 22% 5%
Cafeteria Plan Section 125 8,828 4,502 1,942 1,942 441 51% 22% 22% 5% Social Security & Medicare 2,980 1,520 655 655 149 51% 22% 22% 5% Worker Comp Insurance 18,594 9,483 4,091 4,091 930 51% 22% 22% 5% Benefits - Other 641 327 141 141 32 51% 22% 22% 5%
Info Tech Support Services 59,650 30,422 13,123 13,123 2,983 51% 22% 22% 5% Professional Services 253,000 129,030 55,660 55,660 12,650 51% 22% 22% 5% General Repairs & Maint 10,000 5,100 2,200 2,200 500 51% 22% 22% 5% Postage/Mail/Copy.Printing Svc 13,000 6,630 2,860 2,860 650 51% 22% 22% 5% Membership Dues & Subscription 12,600 6,426 2,772 2,772 630 51% 22% 22% 5% Conferences - Training 21,800 11,118 4,796 4,796 1,090 51% 22% 22% 5% Regulatory Compliance Permits 157,300 80,223 34,606 34,606 7,865 51% 22% 22% 5% Operating Supplies 27,000 13,770 5,940 5,940 1,350 51% 22% 22% 5% Major Equipment 25,000 12,750 5,500 5,500 1,250 51% 22% 22% 5% PERS Retirement 25,730 13,122 5,661 5,661 1,286 51% 22% 22% 5% Subtotal - Wastewater Environmental Compliance $ 856,655 $ 436,894 $ 188,464 $ 188,464 $ 42,833 51% 22% 22% 5% Budget Categories
Total Revenue
Requirements
Flow Strength Customer Basis of Classification
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Funct. & Classification, 20 of 37180
CITY OF AMERICAN CANYON Functionalization & Classification

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 21 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses
FY 2023/24 (VOL) (BOD) (TSS) (CA) (VOL) (BOD) (TSS) (CA) Fund 80 - Non Departmental
810 - Non Departmental
Wages - Full time $ 128,293 $ 65,429 $ 28,224 $ 28,224 $ 6,415 51% 22% 22% 5% Allowances 1,920 979 422 422 96 51% 22% 22% 5%
Health Insurance 21,244 10,834 4,674 4,674 1,062 51% 22% 22% 5% Cafeteria Plan Section 125 4,312 2,199 949 949 216 51% 22% 22% 5% Social Security & Medicare 2,038 1,039 448 448 102 51% 22% 22% 5% Worker Comp Insurance 9,825 5,011 2,161 2,161 491 51% 22% 22% 5% OPEB 49,726 25,360 10,940 10,940 2,486 51% 22% 22% 5%
Professional Services 100,000 51,000 22,000 22,000 5,000 51% 22% 22% 5% Temp Agency Services 6,000 3,060 1,320 1,320 300 51% 22% 22% 5% Membership Dues & Subscription 1,400 714 308 308 70 51% 22% 22% 5% Conferences - Training 5,000 2,550 1,100 1,100 250 51% 22% 22% 5% Office Supplies 1,000 510 220 220 50 51% 22% 22% 5%
Utilities - Water 14,000 7,140 3,080 3,080 700 51% 22% 22% 5% Intra-fund Transfer Out Wastewater 290,090 147,946 63,820 63,820 14,505 51% 22% 22% 5% Transfer to Gen Fnd Support Sv 1,123,854 573,166 247,248 247,248 56,193 51% 22% 22% 5% Retiree Health Benefits 78,433 40,001 17,255 17,255 3,922 51% 22% 22% 5% PERS Retirement 16,257 8,291 3,577 3,577 813 51% 22% 22% 5% ISF - Bldg Maint 262,206 133,725 57,685 57,685 13,110 51% 22% 22% 5% ISF - Fleet 163,573 83,422 35,986 35,986 8,179 51% 22% 22% 5% ISF - Info Tech 237,073 120,907 52,156 52,156 11,854 51% 22% 22% 5% ISF - Legal Services 99,499 50,744 21,890 21,890 4,975 51% 22% 22% 5% Subtotal - Non Department $ 2,615,743 $ 1,334,029 $ 575,463 $ 575,463 $ 130,787 51% 22% 22% 5% Total: Sewer Operations Expenses $ 6,260,396 $ 3,602,374 $ 1,193,398 $ 1,193,398 $ 271,227 58% 19% 19% 4% Strength Customer Basis of Classification Budget Categories Total Revenue
Requirements
Flow
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Funct. & Classification, 21 of 37181
CITY OF AMERICAN CANYON Functionalization & Classification

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 22 : CLASSIFICATION OF EXPENSES FOR COST OF SERVICE ANALYSIS Classification of Expenses, cont.

FY 2023/24 (VOL) (BOD) (TSS) (CA) (VOL) (BOD) (TSS) (CA) Debt Service Payments
Outstanding Debt 215,074 107,537 53,768 53,768 - 50% 25% 25% 0% New Debt Issue - SRF Loan - - - - - 50% 25% 25% 0%
New Debt Issue - Revenue Bond - - - - - 50% 25% 25% 0%
Total Debt Service Payments $ 215,074 $ 107,537 $ 53,768 $ 53,768 $ - 50% 25% 25% 0% Capital Expenditures
Rate Funded Capital Expenses $ 2,573,447 $ 1,286,724 $ 643,362 $ 643,362 $ - 50% 25% 25% 0% TOTAL REVENUE REQUIREMENTS $ 9,048,917 $ 4,996,634 $ 1,890,528 $ 1,890,528 $ 271,227 55% 21% 21% 3% Less: Non-Rate Revenues
Rate Revenue
Interest Income $ (120,000) $ (61,200) $ (26,400) $ (26,400) $ (6,000) 51% 22% 22% 5% Other Revenue (98,593) (50,282) (21,690) (21,690) (4,930) 51% 22% 22% 5% NET REVENUE REQUIREMENTS $ 8,830,324 $ 4,885,152 $ 1,842,438 $ 1,842,438 $ 260,297 Allocation of Revenue Requirements 100.0% 55.3% 20.9% 20.9% 2.9% TABLE 23 : ADJUSTMENT TO CLASSIFICATION OF EXPENSES FOR COST-OF-SERVICE ANALYSIS Adjustment to Current Rate Level: Total (VOL) (BOD) (TSS) (CA) FY 2023/24 Target Rate Rev. After Rate Increases $ 6,303,363 Projected Rate Revenue at Current Rates $ 5,042,690
FY 2023/24 Projected Rate Increase 25%
Adjusted Net Revenue Req'ts $ 6,303,363 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 Percent of Revenue 55.3% 20.9% 20.9% 2.9%
TABLE 24 : NET REVENUE REQUIREMENTS PER COSA RESULTS - PROPOSED ALTERNATIVE Net Revenue Requirements (PROPOSED ALTERNATIVE - 45% Fixed / 55% Variable) Rate-Design Adjustments to Percentages 100.0% 55.3% 20.9% 20.9% 2.9% Rate-Design Adjustments to Dollars $ 6,303,363 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 TABLE 25 : ADJUSTMENT TO COST OF SERVICE RATES 71.38%
Ratio of Targeted Rate Revenue to Net Revenue Requirements Total (VOL) (BOD) (TSS) (CA) Actual Total Fixed Costs $ 2,788,521 $ 1,394,261 $ 697,130 $ 697,130 $ - Adjusted Total Fixed Costs $ 1,990,534 $ 995,267 $ 497,633 $ 497,633 $ - Total Operating Costs $ 6,260,396 $ 3,602,374 $ 1,193,398 $ 1,193,398 $ 271,227 Less: Non Rate Revenue $ (218,593) $ (111,482) $ (48,090) $ (48,090) $ (10,930) Actual Net Operating Costs $ 6,041,803 $ 3,490,891 $ 1,145,307 $ 1,145,307 $ 260,297 Adjusted Net Operating Costs $ 4,312,829 $ 2,491,908 $ 817,556 $ 817,556 $ 185,808 Actual Net Revenue Requirements $ 8,830,324 $ 4,885,152 $ 1,842,438 $ 1,842,438 $ 260,297 Adjusted Net Revenue Requirements $ 6,303,363 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 Flow Strength Customer Basis of Classification Budget Categories Total Revenue
Requirements
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Funct. & Classification, 22 of 37182
CITY OF AMERICAN CANYON Allocation Factors

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 26 : DEVELOPMENT OF THE FLOW ALLOCATION FACTOR
Customer Class1
Number of
Dwelling Units
/ Accounts2
Consumption
(hcf/year)
Winter
Consumption
(Jan-Mar. '22)
Annualized
Winter
Consumptio
n (hcf)
Adjusted
Winter
Volume
(gallons)3
Flow
MGD
BOD
mg/l
TSS
mg/l
BOD
lbs/day
TSS
lbs/day
Flow
MG
BOD
mg/l4
BOD
lbs
% of
Total
BOD
TSS
mg/l4
TSS
lbs
% of
Total
TSS
Residential Customers
Single Family Residential 4,710 507,339 117,749 470,996 352,328,558 0.97 175 175 1,409 1,409 352 n/a 514,224 69.4% n/a 514,224 69.8% Multi-Family Residential 1,265 89,630 20,169 80,676 60,349,682 0.17 175 175 241 241 60 n/a 88,080 11.9% n/a 88,080 12.0% All Other Customers
Commercial 177 318,808 65,311 261,244 195,423,574 0.13 300 300 335 335 49 n/a 122,237 16.5% n/a 122,237 16.6% Industrial5
Hess Collection Winery n/a n/a n/a n/a n/a 0.01 50 30 4 2 3.64 8.6 260 0.0% 2.3 70 0.0% AmCan Beverage (Coca-Cola) n/a n/a n/a n/a n/a 0.13 200 220 209 229 45.63 23.1 8,782 1.2% 5.3 1,998 0.3% Mezzetta Processing Facility n/a n/a n/a n/a n/a 0.04 150 220 51 74 14.82 61.7 7,631 1.0% 81.2 10,035 1.4% Total: 6,152 915,777 203,229 812,916 608,101,814 1.44 2,248 2,291 526 741,214 100.0% 736,644 100.0%

1. Customer data provided by the City for FY 2021/22. Source file: FY 2021-22 Summary by Rate Code - Detailed v2.xlsx .

2. SFR, MFR, and Industrial customers are based on the number of dwelling units and all other customers are based on the number of accounts.

3. Annual consumption for all customer classes based on average winter water consumption.

4. Annual volume and strength factors provided by the City. Source file: SIU 2 year data.xlsx .

5. Flow for industrial customer is based on wastewater flow. Strength factors are based on input from City staff and lower than expected due to customers' pretreatment process. Source file: INF-001 & SIU Flow.xlsx .

TABLE 27 : DEVELOPMENT OF THE CUSTOMER ALLOCATION FACTOR Customer Class
Number of
Dwelling Units
/ Accounts1
Percent
of Total
Residential Customers
Single Family Residential 4,710 76.5%
Multi-Family Residential 1,265 20.6%
All Other Customers
Commercial 177 2.9%
Industrial1
Hess Collection Winery 1 0.0%
AmCan Beverage (Coca-Cola) 1 0.0%
Mezzetta Processing Facility 1 0.0%
Total: 6,155 100.0%

1. SFR, MFR, and Industrial customers are based on the number of dwelling units and all other customers are based on the number of accounts.

TABLE 28 : ESTIMATED FLOW PER DWELLING UNIT
Customer Class
Est. Annual
Wastewater
Flow (hcf)
Est.

Flow/DU/
Day (gallons)
Percent
of Total
Residential Customers
Single Family Residential 470,996 205 --
Multi-Family Residential 80,676 131 63.78%
Design Capacity Total Annual Volume
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Allocation Factors, 23 of 37 183
CITY OF AMERICAN CANYON COSA - Sewer Rates

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 29 : ALLOCATION OF SEWER REVENUE REQUIREMENTS Total (FLOW) (BOD) (TSS) (CA) Total Fixed Costs $ 1,990,534 $ 995,267 $ 497,633 $ 497,633 $ - Net Operating Costs $ 4,312,829 $ 2,491,908 $ 817,556 $ 817,556 $ 185,808 Net Revenue Requirements $ 6,303,363 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 Capacity Charges to recover Fixed Costs Flow ($/MGD) BOD ($/lbs/day) TSS ($/lbs/day) Fixed Costs $ 995,267 $ 497,633 $ 497,633
Design Capacity 1.44 2,248 2,291
$ 691,132.43 $ 221.32 $ 217.18
User Charges Flow ($/MG) BOD ($/lb) TSS ($/lb)
Net operating Costs $ 2,491,908 $ 817,556 $ 817,556
Annual Volumes 526 741,214 736,644
$ 4,740.90 $ 1.10 $ 1.11
Acct. Charge ($/yr)
Customer Costs $ 185,808
Number of Accounts 6,155
$ 30.19
TABLE 30 : ALLOCATION OF SEWER REVENUE REQUIREMENTS
Development of Allocation Factors
Customer Class Total Volume BOD TSS Customer
Residential Customers
Single Family Residential $ 1,284,903 $ 667,139 $ 311,800 $ 305,964 $ - Multi-Family Residential 220,089 114,273 53,408 52,408 - All Other Customers
Commercial $ 239,360 $ 92,509 $ 74,119 $ 72,731 $ -
Industrial
Hess Collection Winery $ 8,355 $ 6,892 $ 920 $ 542 $ -
AmCan Beverage (Coca-Cola) 182,346 86,392 46,145 49,809 - Mezzetta Processing Facility 55,483 28,062 11,242 16,179 - Total: $ 1,990,534 $ 995,267 $ 497,633 $ 497,633 $ -
TABLE 31 : ALLOCATION OF SEWER REVENUE REQUIREMENTS
Development of Allocation Factors
Customer Class Total Volume BOD TSS Customer
Residential Customers
Single Family Residential $ 2,808,246 $ 1,670,355 $ 567,186 $ 570,705 $ - Multi-Family Residential 481,019 286,112 97,152 97,755 - All Other Customers
Commercial $ 502,112 $ 231,621 $ 134,827 $ 135,664 $ -
Industrial
Hess Collection Winery $ 17,621 $ 17,257 $ 286 $ 78 $ - AmCan Beverage (Coca-Cola) 228,207 216,304 9,687 2,217 - Mezzetta Processing Facility 89,814 70,260 8,417 11,137 - Total: $ 4,127,020 $ 2,491,908 $ 817,556 $ 817,556 $ -
Net Revenue Requirements - Design Capacity
Net Revenue Requirements - Operating Costs
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COSA - Sewer Rates, 24 of 37184
CITY OF AMERICAN CANYON COSA - Sewer Rates

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 32 : ALLOCATION OF SEWER REVENUE REQUIREMENTS
Development of Allocation Factors
Customer Class Total Volume BOD TSS Customer
Residential Customers
Single Family Residential $ 142,186 $ - $ - $ - $ 142,186 Multi-Family Residential 38,188 - - - 38,188
All Other Customers
Commercial $ 5,343 $ - $ - $ - $ 5,343
Industrial
Hess Collection Winery $ 30 $ - $ - $ - $ 30
AmCan Beverage (Coca-Cola) 30 - - - 30
Mezzetta Processing Facility 30 - - - 30
Total: $ 185,808 $ - $ - $ - $ 185,808
Grand Total: $ 6,303,363 $ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 TABLE 33 : ALLOCATION OF NET REVENUE REQUIREMENTS TO CUSTOMER CLASSES - PROPOSED ALTERNATIVE Volume BOD TSS Customer
Net Revenue Requirements 1
$ 3,487,175 $ 1,315,190 $ 1,315,190 $ 185,808 $ 6,303,363 --

1. Revenue requirement for each customer class is determined by multiplying the revenue requirement from each cost classification by the allocation factors for each customer class.

TABLE 34 : CALCULATION OF PROPOSED SEWER RATES FOR RESIDENTIAL CUSTOMERS Customer Class No. of Dwelling
Units
Annual Revenue
Requirement
Monthly Fixed
Charge Per
Dwelling Unit
Residential Customers
Single Family Residential 4,710 $ 4,235,335 $74.94
Multi-Family Residential 1,265 739,296 $48.70
Subtotal: Residential 5,975 $ 4,974,631
% of COS
Net Revenue
Reqts.

Net Revenue Requirements - Customer Costs
Customer Class
Cost Classification Components Cost-of-Service
Net Revenue
Reqts.

Prepared by NBS
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COSA - Sewer Rates, 25 of 37185
CITY OF AMERICAN CANYON COSA - Sewer Rates

SEWER RATE STUDY
Cost-of-Service Analysis
TABLE 35 : CALCULATION OF PROPOSED SEWER RATES FOR COMMERCIAL CUSTOMERS - PROPOSED ALTERNATIVE Customer Class No. of Accounts Annual Volume
(hcf)
Total Annual
Revenue
Requirement
Monthly
Capacity Per
Account
Monthly
Customer Charge
Per Account
Monthly Fixed
Charge Per
Account1
Volumetric
Charge
Per hcf
Commercial
Commercial 177 261,244 $ 746,815 $112.69 $ 2.52 $115.21 $1.92

1. Monthly fixed charge is the based fixed charge plus the monthly customer charge per the number of accounts.

TABLE 36 : CALCULATION OF PROPOSED SEWER RATES FOR INDUSTRIAL CUSTOMERS Customer Class
Total Annual
Revenue
Requirement
Annual Volumes Proposed Rates
Industrial
Monthly Fixed Administrative Charge $ 91 $3
Fixed Charges (Design Capacity)
Flow - per HCF per day $ 121,346 235 HCF per day $517
BOD - per pound per day 58,307 263 lbs./day $221
TSS - per pound per day 66,530 306 lbs./day $217
Sewer Use Charges
Flow - per HCF $ 303,821 85,675 HCF $3.54
BOD - per pound 18,390 16,673 lbs. $1.10
TSS - pound 13,432 12,103 lbs. $1.11
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COSA - Sewer Rates, 26 of 37186
CITY OF AMERICAN CANYON Current vs. Proposed Rates

SEWER RATE STUDY
Cost-of-Service Analysis & Rate Design
TABLE 37 : CURRENT VS. PROPOSED SEWER RATES
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

2. The fixed charge includes a monthly customer charge per account.

3. Current rates for commercial customers are charged the higher of the fixed or variable rate. Proposed rates have both a fixed and volumetric charge per commercial customer.

Proposed Sewer Rates Current
Rates Sewer Rate Schedule1,2 Description
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Current & Proposed Rates, 27 of 37187
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #1, Page 28 of 37 $725.76 $738.60 $785.04 $884.88 $899.28 $982.38$1,272.00 $1,274.88 $1,906.32 $0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
City of American
Canyon (Current)
Napa Sanitation
District
Town of
Yountville
Vallejo Flood &
Wastewater
District
Proposed Rates City of Benicia City of Petaluma City of Calistoga City of St. Helena City of American Canyon (Year 1)
Annual Sewer Bill Comparison - Single Family Accounts
188
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #2, Page 29 of 37 $60.48 $61.55 $65.42 $73.74 $74.94 $81.87$106.00 $106.24 $158.86 $0
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
City of American
Canyon (Current)
Napa Sanitation
District
Town of
Yountville
Vallejo Flood &
Wastewater
District
Proposed Rates City of Benicia City of Petaluma City of Calistoga City of St. Helena City of American Canyon (Year 1)
Monthly Sewer Bill Comparison - Single Family Accounts
189
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Regional Bill Comp #3, Page 30 of 37 $60.48 $61.55 $73.74 $81.51 $89.49$112.81 $114.68 $145.14 $186.00 $0
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
City of American
Canyon (Current)
Napa Sanitation
District
(July 2023)
Vallejo Flood &
Wastewater
District
(July 2023)
Town of
Yountville
(January 2027)
City of Benicia
(January 2026)
Proposed Rates City of Petaluma
(July 2027)
City of Calistoga
(January 2028)
City of St. Helena
(July 2027)
City of American Canyon (Year 5)
Monthly Sewer Bill Comparison - Single Family Accounts
190
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 SFR Bill Comp #1, Page 31 of 37 $60.48 $74.94 $60.48 $89.93 $60.48 $100.72 $60.48 $112.81 $60.48 $112.81 $0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
$110
$120
Current Rates Proposed Rates
Single Family Residential Monthly Sewer Bills - 5-Year Projections FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
191
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 MFR Bill Comp #1, Page 32 of 37 $45.36 $48.70 $45.36 $58.44 $45.36 $65.45 $45.36 $73.31 $45.36 $73.31 $0
$10
$20
$30
$40
$50
$60
$70
$80
Current Rates Proposed Rates
Multi-Family Residential Monthly Sewer Bills - 5-Year Projections FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
192
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Comm Bill Comp #1, Page 33 of 37 $60.48 $138.75 $60.48 $166.50 $60.48 $186.48 $60.48 $208.86 $60.48 $208.86 $0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
$275
Current Rates - 100% Fixed Proposed Rates
Commercial Monthly Sewer Bills - 5-Year Projections
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Note: Commercial customer bills are based on average annual consumption of 147 HCF per month. 193
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Comm Bill Comp #2, Page 34 of 37 $60.48 $60.48 $60.48 $60.48 $60.48 $60.48 $211.31 $307.41$347.77$397.74 $466.94 $499.61 $0
$100
$200
$300
$400
$500
$600
50 100 121 147 183 200
Annual Bill
Consumption (HCF)
Commercial Sewer Bill Comparison
Current vs. Proposed Rates (FY 2023/24)
Current Rates - 100% Fixed
Proposed Rates
Average
WINTER Bill
(121 HCF/mo.)
Average
ANNUAL Bill
(147 HCF/mo.)
194
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Industrial Bill Comp, Page 35 of 37 $15,023.34 $17,704.24 $15,023.34 $20,917.84 $15,023.34 $23,237.95 $15,023.34 $25,822.27 $15,023.34 $25,822.27 $0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
Current Rates Proposed Rates
AmCan Beverages Inc. Monthly Sewer Bills - 5-Year Projections FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
195
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Combined Bill #1, Page 36 of 37 $60.48
$74.94
$89.93 $100.72 $112.81 $112.81
$79.95
$83.49
$91.00
$99.19
$103.16 $106.25
$140.43
$158.43
$180.93
$199.91
$215.96 $219.06
$0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
Current FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Annual Bill
Single Family Residential Utility Bill
Water* Sewer**
* Water bill is calculated using a 1" Meter and monthly winter water use of 7 HCF (Alternative 1). ** Sewer bill is based on COSA - 55% Fixed / 45% Variable. 196
Prepared by NBS
www.nbsgov.com | Toll-Free: 800.676.7516 Combined Bill #2, Page 37 of 37 $60.48
$74.94
$89.93 $100.72 $112.81 $112.81
$79.95
$86.31
$90.78
$95.55
$98.79 $101.75
$140.43
$161.25
$180.71
$196.27
$211.59 $214.56
$0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
Current FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Annual Bill
Single Family Residential Utility Bill
Water* Sewer**
* Water bill is calculated using a 1" Meter and monthly winter water use of 7 HCF (Alternative 2). ** Sewer bill is based on COSA - 55% Fixed / 45% Variable. 197
3 NOTICE OF PROPOSED WATER, SEWER & RECYCLED WATER RATE INCREASES WWW.CITYOFAMERICANCANYON.ORG/RATES
Water Rate Schedule Current
Rates
Proposed Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges (in $/mo)
Residential Use
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $26.56 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $26.56 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $26.56 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $26.56 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $26.56 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $26.56 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Multi-Family, Commercial and Landscape
< 1" meter $26.56 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter (Residential) $26.56 $31.32 $34.14 $37.21 $38.70 $39.86 1" meter (Commercial) $44.42 $31.32 $34.14 $37.21 $38.70 $39.86 1 1/2" meter $88.75 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $1,420.06 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Private Fire Protection
< 1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $13.28 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $13.28 $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $13.28 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $13.28 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $13.28 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $13.28 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $13.28 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Temporary Hydrant Meters
< 1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $283.98 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter $283.98 $58.53 $63.80 $69.55 $72.33 $74.50 2" meter $283.98 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter $283.98 $178.29 $194.33 $211.82 $220.30 $226.91 4" meter $283.98 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $283.98 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter $283.98 $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Water Rate Schedule
198
4 NOTICE OF PROPOSED WATER, SEWER & RECYCLED WATER RATE INCREASES WWW.CITYOFAMERICANCANYON.ORG/RATES
Sewer Rate Schedule Description Current
Rates
Proposed Sewer Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Residential — Monthly Fixed Service Charges
Single Family Residential Per Dwelling Unit $60.48 $74.94 $89.93 $100.72 $112.81 $112.81 Multi-Family Residential Per Dwelling Unit $45.36 $48.70 $58.44 $65.45 $73.31 $73.31 Commercial Customers
Monthly Fixed
Service Charge Per Account $60.48 $115.21 $138.25 $154.84 $173.42 $173.42 Volumetric Charge Per HCF $5.40 $1.92 $2.31 $2.58 $2.89 $2.89 Industrial Customers
Monthly Fixed
Administrative Charge Per Account n/a $2.52 $3.02 $3.38 $3.79 $3.79 Fixed Charges
Flow - per HCF per day Per HCF per day
Sewage Flow n/a $517 $620 $695 $778 $778
BOD - per pound per day Per pound per day n/a $221 $266 $298 $334 $334 TSS - per pound per day Per pound per day n/a $217 $261 $292 $327 $327 Sewer Use Charges
Flow - per HCF Per HCF
Sewage Flow n/a $3.54 $4.25 $4.76 $5.33 $5.33
BOD - per pound Per pound n/a $1.10 $1.32 $1.48 $1.66 $1.66 TSS - pound Per pound n/a $1.11 $1.33 $1.49 $1.67 $1.67 Sewer Rate Schedule
Water Rate Schedule Current
Rates
Proposed Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Raw Water
< 1" meter n/a $31.32 $34.14 $37.21 $38.70 $39.86
1" meter $44.42 $31.32 $34.14 $37.21 $38.70 $39.86
1 1/2" meter n/a $58.53 $63.80 $69.55 $72.33 $74.50
2" meter $141.99 $91.19 $99.40 $108.35 $112.68 $116.06
3" meter n/a $178.29 $194.33 $211.82 $220.30 $226.91
4" meter $443.74 $276.27 $301.13 $328.23 $341.36 $351.60 6" meter $887.48 $548.43 $597.79 $651.59 $677.66 $697.99 8" meter n/a $875.03 $953.78 $1,039.63 $1,081.21 $1,113.65 Variable Charges for All Water Consumed (in $/hcf)
Residential Use
Tier 1 (0 - 6 units) $7.54 $7.07 $7.70 $8.40 $8.73 $8.99 Tier 2 (> 6 units) $8.15 $9.76 $10.64 $11.60 $12.06 $12.42 Multi-Family, Commercial and Landscape $7.72 $7.62 $8.30 $9.05 $9.41 $9.70 Private Fire Protection $3.86 $7.62 $8.30 $9.05 $9.41 $9.70 Temporary Hydrant Meters
Potable $7.72 $7.62 $8.30 $9.05 $9.41 $9.70
Recycled $0.90 $6.69 $7.36 $8.10 $8.50 $8.93
Raw Water $3.44 $7.62 $8.30 $9.05 $9.41 $9.70
(Continued)
199
5 NOTICE OF PROPOSED WATER, SEWER & RECYCLED WATER RATE INCREASES WWW.CITYOFAMERICANCANYON.ORG/RATES
Recycled Water Rate Schedule Current
Rates
Proposed Rates
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges (in $/mo)
< 1" meter $26.56 $38.89 $42.78 $47.05 $49.41 $51.88
1" meter $44.42 $64.81 $71.29 $78.42 $82.34 $86.46
1 1/2" meter $88.75 $129.62 $142.58 $156.84 $164.69 $172.92 2" meter $141.99 $207.40 $228.14 $250.95 $263.50 $276.67 3" meter $283.98 $414.79 $456.27 $501.90 $526.99 $553.34 4" meter $443.74 $648.11 $712.92 $784.22 $823.43 $864.60 6" meter $887.48 $1,296.23 $1,425.85 $1,568.43 $1,646.85 $1,729.20 8" meter $1,420.06 $2,073.96 $2,281.36 $2,509.49 $2,634.97 $2,766.71 Commodity Charges for All
Water Consumed (in $/hcf)
Variable Charge $0.90 $6.69 $7.36 $8.10 $8.50 $8.93
Variable Charge - Self-Haul $0.00 $4.00 $4.41 $4.85 $5.09 $5.34 Recycled Water Rate Schedule
200
6 NOTICE OF PROPOSED WATER, SEWER & RECYCLED WATER RATE INCREASES WWW.CITYOFAMERICANCANYON.ORG/RATES
Drought rates are only effective upon City Council action consistent with the City of American Canyon Municipal Code Chapter

13.14, Water Conservation Plan.

Drought Rate Schedule
Proposed Drought Rate
(in addition to Proposed Water Rate Schedule on pages 2 & 3) FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Conservation Target
Up to 10% $0.35 $0.44 $0.53 $0.58 $0.62
Up to 20% $0.79 $0.98 $1.19 $1.30 $1.39
Up to 30% $1.36 $1.68 $2.03 $2.23 $2.39
Up to 40% $2.12 $2.61 $3.16 $3.46 $3.71
Up to 50% $3.17 $3.92 $4.75 $5.20 $5.57
>50% $4.76 $5.88 $7.12 $7.79 $8.36
HOW TO FILE A PROTEST AGAINST THE PROPOSED RATE CHANGES Any property owner of record and/ or ratepayer whose property is
subject to the proposed new rates
for the City’s utility service fees may
submit a written protest against the
proposed rate increases.

Only one written protest will
be counted per identified parcel.

To be valid, each written protest must:
• State that the identified
property owner and/or
ratepayer is in opposition to
the proposed rate increases;
• Provide the location of the
identified parcel (by assessor’s
parcel number, street address, or
customer account);
• Include the name and original
signature of the property owner
and/or ratepayer submitting the
protest; and
• If the person protesting was not
shown on Napa County’s last
equalized assessment roll as the
property owner and/or ratepayer
of record, provide written evidence
that the person is the property
owner and/or ratepayer (example:
current copy of city services bill).

Written protests may be submitted by mail or in person to:

City of American Canyon, Attention: City Clerk, 4381 Broadway, Suite 201, American Canyon, CA 94503 Any protest submitted via e-mail or other electronic means will not qualify as a written protest. Written protests may also be submitted at the public hearing (date and time noted above). All written protests must be submitted to the City prior to the conclusion of the public comment portion of the public hearing.

Please note that there is a 120-day statute of limitations from the effective date of the resolution or ordinance adopting the rates to challenge any of the rates described herein.

At the public hearing, the City Council will accept and consider all written protests and hear all oral comments on the proposed rate increases. Oral comments at the
public hearing will not qualify as formal protests unless accompanied by a written protest. At the conclusion of the public hearing, the City Council will consider adoption of the proposed changes as follows:

1. If less than a majority of property owners or ratepayers file a protest, the City Council will consider increasing water rates, effective May 1, 2024.

2. If a majority of affected property owners or ratepayers protest the increase before the conclusion of a
required public hearing, the City is prohibited by law
from increasing water rates.

Drought Rate Schedule
201

CITY COUNCIL AGENDA
APRIL 2, 2024

STAFF REPORT

BUSINESS
ITEM NUMBER: 11.

TITLE
New 'Environmental Sustainability' Goal

RECOMMENDATION
Adopt a Resolution approving a new 'Environmental Sustainability' Goal and various strategies.

CONTACT
Jason Holley, City Manager

BACKGROUND & ANALYSIS
From 2013-2015, the City Council led a community-wide 'visioning' resul4ng in the crea4on of a Vision, Mission, Values and Goals (A8achment 2). This effort memorialized the community's ethos since Incorpora4on (in 1992) and established a trajectory for the next two decades. At the 4me, American Canyon residents were generally pleased with how things had turned out and wanted more of the same. Today, community's sentiment generally remains the same.

American Canyon's Vision Statement is as follows:

Home to an engaged, diverse community;
Destination for outdoor recreation and natural beauty;
Hub of opportunity and economic vitality.

The City of American Canyon is the primary service provider within the community. The community's input during the visioning process led to the organiza4on's Mission Statement is a follows:

Our mission is to deliver exemplary services that are responsive to community priori es, ensure a
healthy and sustainable organization, and drive us toward our shared vision for the future.

In addi4on, the Council and staff developed a myriad of strategies and key ini4a4ves to support the Vision, Mission, Values and Goals (A8achments 3 & 4). These items con4nue to guide our decisionmaking and work plans (Attachment 5).

In 2023, the City Council confirmed the 'trajectory' envisioned by the community in 1992, and later 202
memorialized in 2013-2015, was s4ll the guiding path today. However, at the February 2 strategic planning workshop, the Council explored the dearth of emphasis on the topic of 'environmental sustainability'.

Over the past decade, American Canyon has become known state-wide as leader in environmental suitability, particularly in the areas of land use/housing, water conservation and recycled water.

For example, in 2022, American Canyon's per capita GHG emissions were es4mated to be 13% less the state-wide average and 39% less than the national average.

Prior success include:
2012 Energy Efficiency Climate Action Plan
2016 ILG Beacon Award
2017 CA Water Re-Use Award
2018 Green Building Code
2020 Climate Action Proclamation
2021 Gas Station Moratorium
2022 Climate Action Resolution
2022 Countywide Climate Action Committee – GHG Baseline This topic of environmental sustainability has gained importance to the community and it is appropriate to recognize the City's prior efforts and future interests with a new proposed Goal:
"Demonstrate Leadership in Environmental Sustainability." As we start to develop strategies to support this new goal, a few guiding principles arise:
"Focus on City opera4ons first, before trying to impose changes on other (poten4ally unwilling) participants".
"Sea level change impacts western edge and fire impacts in open spaces like Newell and Clark Ranch are a concern".
"Supporting regional efforts (instead of going first alone and/or opposing) is desirable." "Educa4ng residents and businesses is essen4al to obtaining the 'buy-in' precedent to behavior change".
"Balance new development while preserving other lands as open space". "Implement strategies that 'make sense' for American Canyon instead of chasing feel-good accolades or capitulating to outsiders.

Below are proposed new strategies to support the new goal:

1. Pursue net-zero climate pollution for city operations.

2. Fortify locations vulnerable to climate change.

3. Collaborate with regional partners to reduce climate pollutants.

4. Identify lands for new development while preserving other lands as open space.

5. Educate the community to obtain buy-in for behavior change. 203
Staff recommends adop4ng the new Goal - "Demonstrate Leadership in Environmental Sustainability" and the above strategies (Attachment 1).

COUNCIL PRIORITY PROGRAMS AND PROJECTS
Organizational Effectiveness: "Deliver exemplary government services."

FISCAL IMPACT
There is no fiscal impact of adop4ng a new goal. The various strategies and key ini4a4ve may have positive or negative fiscal impacts, but it would be too speculative to prognostic at this time.

ENVIRONMENTAL REVIEW
15378(b) - The ac4on is not a "Project" subject to the California Environmental Quality Act ("CEQA") because it does not qualify as a "Project" under Public Resources Code Sec4ons 21065 and 21080 and in Section 15378(b) of Title 14 of the California Code of Regulations.

ATTACHMENTS:

1. Resolution - Environmental Sustainability Goal

2. Visioning Drawing

3. Hierarchy

4. Goals and Strategies

5. Strategic Work Plan
204
RESOLUTION NO. 2024-______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON APPROVING A NEW 'ENVIRONMENTAL SUSTAINABILITY' GOAL AND VARIOUS STRATEGIES.

WHEREAS, from 2013-2015, the City Council led a community-wide 'visioning' resulted in the creation of American Canyon's Vision, Mission, Values and Goals; and WHEREAS, American Canyon’s Vision Statement is: Home to an engaged, diverse community. Destination for outdoor recreation and natural beauty. Hub of opportunity and economic vitality.

WHEREAS, American Canyon’s Public Safety Goal is: “Ensure that American Canyon remains a safe community”; and
WHEREAS, American Canyon’s Community & Sense of Place Goal is: “Build on the strength of our local community to develop a clear sense of place and establish our unique identity.”; and WHEREAS, American Canyon’s Economic Development & Vitality Goal is: “Attract and expand diverse business and employment opportunities.”; and
WHEREAS, American Canyon’s Outdoors & Recreation Goal is: “Expand opportunities for use of outdoor recreation and an active lifestyle.”; and
WHEREAS, American Canyon’s Transportation Goal is: “Improve the City’s transportation network to mitigate traffic and enhance the quality of life for the community.”; and WHEREAS, American Canyon’s Infrastructure Goal is: “Develop and upgrade infrastructure resources to support sustainable growth.”; and
WHEREAS, American Canyon’s Quality Services & Organizational Effectiveness Goal is: “Deliver exemplary government services.”; and
WHEREAS, the City Council desires a goal related to ‘environmental sustainability’.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of American Canyon hereby approves the following “Environmental Sustainability Goal: Demonstrate leadership in environmental sustainability.”
NOW, THEREFORE, BE IT FURTHER RESOLVED that the City Council of the City of American Canyon hereby approves the following strategies to support the Environmental Sustainability Goal:

1. Pursue net-zero climate pollution for city operations.

2. Fortify locations vulnerable to climate change.

3. Collaborate with regional partners to reduce climate pollutants.

4. Identify lands for new development while preserving other lands as open space.

5. Educate the community to obtain buy-in for behavior change. 205
2 PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 2nd day of April, 2024 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
____________________________
Leon Garcia, Mayor
ATTEST: APPROVE AS TO FORM:
____________________________ _____________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 206
207
208
American Canyon’s Goals and Strategies
Public Safety Goal - Ensure American Canyon remains a safe community Strategy PS-1: Ensure American Canyon is prepared for emergencies and disasters.

Strategy PS-2: Engage and respond to the community's safety concerns.

Community and Sense of Place Goal - Build on the strength of our local community to develop a clear Strategy CD-1: Develop and strengthen placemaking opportunities Strategy CD-2: Promote a unique community identity.

Strategy CD-3: Encourage residential/commercial development within Watson Ranch.

Strategy CD-4: Expand network of community groups and volunteer opportunities.

Economic Development and Vitality Goal - Attract and expand diverse business and employment Strategy ED -1: Identify opportunities for businesses.

Strategy ED-2: Facilitate industrial/commercial development within Green Island Industrial Area.

Strategy ED-3: Facilitate mixed-use development within Broadway District Specific Plan Area.

Strategy ED-4: Encourage and facilitate tourism.

Strategy ED-5: Expand jurisdictional boundaries to provide areas for future growth.

Outdoors and Recreation Goal - Expand opportunities for use of outdoor recreation and an active Strategy RE-1: Ensure recreation programming and events attract a broad spectrum of residents.

Strategy RE-2: Partner with community groups to deliver opportunities for organized activity.

Strategy RE-3: Enhance parks and open space amenities.

Strategy RE-4: Facilitate the development of interconnected trail systems.

Transportation Goal - Improve the transportation network within the City to alleviate congestion and Strategy TR-1: Improve traffic flow along Highway 29.

Strategy TR-2: Better the condition of local streets.

Strategy TR-3: Expand network of local streets and parallel routes to Highway 29.

Strategy TR-4: Improve safety and expand access for bicyclists, pedestrians and transit users.

Infrastructure Goal - Develop and maintain infrastructure resources to support sustainable growth.

Strategy IN-1: Deliver high-quality drinking water from a stable, long-term supply.

Strategy IN-2: Provide recycled water alternatives for non-potable uses.

Strategy IN-3: Collect and treat non-industrial and industrial wastes effectively and efficiently.

Strategy IN-4: Prevent flooding of natural and man-made drainage systems.

Organizational Effectiveness Goal - Deliver exemplary government services.

Strategy OR-1: Ensure fiscal stability to deliver services and maintain assets.

Strategy OR-2: Emphasize customer service and community priorities.

Strategy OR-3: Engage the entire community.

Strategy OR-4: Implement new technology.

Strategy OR-5: Encourage continuous improvement and best practices.

Strategy OR-6: Increase employee engagement and development programs.

Strategy OR-7: Demonstrate leadership in environmentally sustainability. 209
Public Safety Goal - Ensure American Canyon remains a safe community Key Initiative Category 2024 Milestone
Formalize interagency relationship
with ACFPD.

City Organizational
Improvement
Approve Operating Agreement
MOU.

Update 'Emergency Operations
Plan'.

City Organizational
Effort
Evaluate staffing need/service
delivery model.

Key Initiative Category 2024 Milestone
Evaluate law enforcement service
levels.

City Organizational
Improvement
Approve Amendment 20 with Napa
Sheriff.

Strategy PS-1: Ensure American Canyon is prepared for emergencies and disasters.

Strategy PS-2: Engage and respond to the community's safety concerns. 3/28/2024 Key Initiatives 2024 1 of 8
210
Key Initiative Category 2024 Milestone
Complete Napa Valley Ruins and
Gardens.
3rd Party
Development Project
Approve on-site utility plans.

Approved special event permit.

Key Initiative Category 2024 Milestone
Develop Eco-Center. 3rd Party
Development Project
Approved Design Permit. Approve
Long-Term Lease.

Complete wetlands
restoration/kayack launch at former
Corporation Yard.

Future City Capital
Project
Complete 'Feasibility Assessment'.

Key Initiative Category 2024 Milestone
Extend Rio Del Mar to Hwy 29. Future City Capital
Project
Aquire right-of-way from Adobe
Property
Update AC-1 Development
Agreement.
3rd Party
Development Project
Approve DA Amendment
Key Initiative Category 2024 Milestone

N/A N/A N/A
Strategy CD-4: Expand network of community groups and volunteer opportunities.

Community and Sense of Place Goal - Build on the strength of our local community to develop Strategy CD-1: Develop and strengthen placemaking opportunities Strategy CD-2: Promote a unique community identity.

Strategy CD-3: Encourage residential/commercial development within Watson Ranch. 3/28/2024 Key Initiatives 2024 2 of 8
211
Key Initiative Category 2024 Milestone

N/A N/A N/A
Key Initiative Category 2024 Milestone
Respond to voter initiative (Measure
K).
3rd Party Planning
Effort
Council appove as-is or submit to
voters.

Upgrade WRF to treat industrial
high-strength waste.

Future City Capital
Project
Basis of Design Report complete.

Key Initiative Category 2024 Milestone
Re-develop Adobe Property. 3rd Party
Development Project
Apply for grant funding to maxmize
development potential
Underground overhead utilities
along Highway 29.

City Planning Effort Approve nexus fee program.

Key Initiative Category 2024 Milestone
Complete Home 2 Suites Hotel. 3rd Party
Development Project
Approve final occupany.

Complete Watson Ranch Hotel. 3rd Party
Development Project
Submit building permit.

Key Initiative Category 2024 Milestone
Annex Watson Lane Territory. Litigation Refer to City Attorney Expand Urban Limit Line. City Planning Effort Initiate discussion with County about ULL changes
Economic Development and Vitality Goal - Attract and expand diverse business and Strategy ED -1: Identify opportunities for businesses.

Strategy ED-2: Facilitate industrial/commercial development within Green Island Industrial Strategy ED-3: Facilitate mixed-use development within Broadway District Specific Plan Area.

Strategy ED-4: Encourage and facilitate tourism.

Strategy ED-5: Expand jurisdictional boundaries to provide areas for future growth. 3/28/2024 Key Initiatives 2024 3 of 8
212
Key Initiative Category 2024 Milestone
Solicit resident satisfaction
feedback.

City Organizational
Improvement
Complete NCS. Implement postprogram surveys.

Key Initiative Category 2024 Milestone
Implement Clark Ranch Master Plan. 3rd Party Capital
Project
Napa Firewise to complete fire
hazard mitigation project.

Key Initiative Category 2024 Milestone
Update Newell Open Space
Management Plan.

City Planning Effort Establish trail operatins and
maintenance standards.

Key Initiative Category 2024 Milestone
Add trails adjacent to Newell Open
Space.
3rd Party
Development Project
Acquire Jaeger Open Space
Outdoors and Recreation Goal - Expand opportunities for use of outdoor recreation and an Strategy RE-1: Ensure recreation programming and events attract a broad spectrum of Strategy RE-2: Partner with community groups to deliver opportunities for organized activity.

Strategy RE-3: Enhance parks and open space amenities.

Strategy RE-4: Facilitate the development of interconnected trail systems. 3/28/2024 Key Initiatives 2024 4 of 8
213
Key Initiative Category 2024 Milestone
Complete 'Hwy 29 Multi-Modal
Operational Improvement Project'.
3rd Party Capital
Project
NVTA hire consultant and initiate
PE-AD Phase
Key Initiative Category 2024 Milestone
Adopt Measure X Ordinance. 3rd Party Planning
Effort
NVTA-TA places Measure X on
November 2024 ballot
Implement paving project. Future City Capital
Project
Refer to CIP
Key Initiative Category 2024 Milestone
Update Traffic Impact Fee. City Organizational
Effort
Approve nexus study and fee
program.

Extend Newell Drive to Hwy 29. Litigation Refer to City Attorney Key Initiative Category 2024 Milestone
Implement 'Complete Streets' on
Paving Projects
Future City Capital
Project
Refer to CIP
Transportation Goal - Improve the transportation network within the City to alleviate Strategy TR-1: Improve traffic flow along Highway 29.

Strategy TR-2: Better the condition of local streets.

Strategy TR-3: Expand network of local streets and parallel routes to Highway 29.

Strategy TR-4: Improve safety and expand access for bicyclists, pedestrians and transit users. 3/28/2024 Key Initiatives 2024 5 of 8
214
Key Initiative Category 2024 Milestone
Complete Sites Reservoir Project. 3rd Party Capital
Project
Approve Benefits and Obligations
Agreement.

Resolve Vallejo Water litigation. Litigation Refer to City Attorney Secure new capital for infrastructure
investments.

City Organizational
Effort
Adopt new water rates.

Key Initiative Category 2024 Milestone
Connect Tower Road customers. Future City Capital
Project
Install new services to 6 customers.

Secure new capital for infrastructure
investments.

City Organizational
Effort
Establish recycled water rates.

Key Initiative Category 2024 Milestone
Prepare Water Reclamation Facility
Master Plan.

Future City Capital
Project
None
Secure new capital for infrastructure
investments.

City Organizational
Effort
Adopt new sewer rates.

Key Initiative Category 2024 Milestone

N/A N/A N/A
Infrastructure Goal - Develop and maintain infrastructure resources to support sustainable Strategy IN-4: Prevent flooding of natural and man-made drainage systems.

Strategy IN-1: Deliver high-quality drinking water from a stable, long-term supply.

Strategy IN-2: Provide recycled water alternatives for non-potable uses.

Strategy IN-3: Collect and treat non-industrial and industrial wastes effectively and efficiently. 3/28/2024 Key Initiatives 2024 6 of 8
215
Key Initiative Category 2024 Milestone
Update Goverance Protocols. City Organizational
Effort
Approve fiscal policy confirming
'capital set aside'.

Key Initiative Category 2024 Milestone
Update General Plan. City Planning Effort DEIR circulated for public comment Key Initiative Category 2024 Milestone
Create Communications Strategic
Plan.

City Organizational
Effort
Approve plan
Develop new website. City Organizational
Effort
Go live.

Key Initiative Category 2024 Milestone
Upgrade accounts payable system. City Organizational
Effort
Implement Invoice Cloud
Implement Computerized Maint.

Management System.

City Organizational
Effort
Key Initiative Category 2024 Milestone
Upgrade financial system. City Organizational
Effort
Migrate to Springbrook Cloud
Upgrade payroll system. City Organizational
Effort
Implement ESS module
Key Initiative Category 2024 Milestone
Implement PWD/MUD OA
recomendations.

City Organizational
Effort
Hire utilities leader.

Implement P&R OA
recommedations.

City Organizational
Effort
Employee training and special
projects.

Organizational Effectiveness Goal - Deliver exemplary government services.

Strategy OR-1: Ensure fiscal stability to deliver services and maintain assets.

Strategy OR-2: Emphasize customer service and community priorities.

Strategy OR-3: Engage the entire community.

Strategy OR-4: Implement new technology.

Strategy OR-5: Encourage continuous improvement and best practices.

Strategy OR-6: Increase employee engagement and development programs. 3/28/2024 Key Initiatives 2024 7 of 8
216
City Council Committee Report
Submitted
by: * Councilmember Mark Joseph
Council
Meeting
Date:
04/02/2024
Event
Date: 2024-03-22
Event Type Committee Report
Event Title:* Climate Action Committee
Event Report: Attended the monthly meeting. The main topic was a model Food ware Ordinance. The main points included only compostable food ware, if reusable is not available; offering a discount if the customer brings their own utensils; charging customers 25 cents to $1.00 if they do not bring their own cups, utensils or reusable plates. The goal is to send this to all the jurisdictions, and encourage them to adopt something similar. This will require a lot of outreach to our local restaurants, and implementation may take time to allow the outreach/educational process to unfold, as well as to reduce the inventory of disallowed products. Some documentation was presented that showed restaurants could actually save money from this ordinance.

We also heard an update on the Bay-Ren programs and staffing opportunity. There are a number of existing regional programs that would benefit our residents and businesses. The challenge is getting the word out and having support staff to work with the customer.

Also met with Assembly Majority Leader, Cecilia Aguiar-Curry, to discuss the 24/7 GHG monitoring project. Although she pointed out the State cannot help at this time, she did give us several people to contact that might be able to help us fund the project.

File/Photo Upload Max file size for all uploads is 25 MB Event
Date: 2024-03-20
Event Type Committee Report
Event Title:* Napa Valley Transportation Authority (NVTA) Event Report: Held our monthly meeting. We adopted bus fare increases for our transit system. There hadn't been an increase since 2015, and this bump was required to ensure we keep our farebox recovery rate in compliance with State Law. We also received a report on our Audit, and a preview of our upcoming two-year budget. We received an update on our Transit Operations, and approved an increase for the Calistoga-St. Helena portion of the Vine Trail. A wet winter and delays due to PGE has forced cost overruns and project delays for this project. Hopefully, we will receive some reimbursement from PGE when this is over.

I also participated in NVTA's efforts to secure support for the updated Measure T Road Tax. I was at our City's first presentation and also attended St. Helena's Council meeting. This is not a new tax; just a better program. In particular, it allows bonding and creates two regional programs: traffic relief and emergency response/evacuation routes.

File/Photo Upload Max file size for all uploads is 25 MB Event
Date:

Event Type Other
Event Title:* City Activities and Events
Event Report: Attended the "Gator" meeting at Napa Junction Community Center. We discussed the nominees and also agreed to meet again to provide revisions to the current Resolution. These revisions would reflect the Gators' longstanding views on the program.
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Stopped by the City's "Bunny Brunch." There was a good stream of parents and children attending. Discussed how the Arts Foundation might partner with the City next time and bring back our Chalk Art Egg Drawing event.

Represented the City (along with most of the Council and many community leaders) at the "check drop" for the EcoCenter. Thanks to Congressman Thompson, the Eco-Center will receive $800,000, which will go towards developing the design drawings. It was also a beautiful day, and holding the event at the Wetlands was great.

Fielded a few calls regarding our Utility Rate increases. It helps that we have reworked some of the numbers so the increases are not as great. We'll see what happens next Tuesday.

File/Photo Upload Max file size for all uploads is 25 MB Event
Date:

Event Type Community Event
Event Title:* Various Community Events and Activities
Event Report: The Arts Foundation produced their second ACHS Arts & Music Fest event at the High School. Thanks to a grant from Napa Valley Presents, we were able to put on the event and provide funding for our Visual and Performing Arts classes. We were more organized this year; next year we will further refine the process and begin reaching out to the community.

Held another successful Open Mic event at Napa Junction Community Center. Some of the best performances yet! Helped with the monthly Kiwanis Food Drive. This is the second time we ran out of food. We are finally settling into our new spaces, and we're getting ready to move towards adding the "choice" model to our program (allowing customers to select their own nonperishables).

Attended the monthly Kiwanis General Membership Meeting. A small crowd but plenty of food. We welcomed back a member (Clarence Mamaril), and watched a video on Youth Protective Services. Preliminary numbers suggest our Crab Feed netted over $20,000--more than we have made since March 2020 (pre-pandemic).

Participated in Arvind Nischal's annual Holi Festival of Colors. It was another great event; good turnout, plenty of food and colors! The Arts Foundation was able to help support this event, and hope to expand our support in the future.

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Future Agenda Items of Note:

April 16, 2024; 6:30 p.m.

Proclamation - April Volunteer Week
Proclamation - Earth Day
Proclamation - National Building Safety Month
Presentation - Spirit Horse
Presentation - ACPD Cadets
Watson Ranch Lot 8
Police Services Agreement
Staffing Plan - FY 24/25 and Beyond
May 7, 2024; 6:30 p.m.

Presentation - Municipal Clerk Week
Proclamation - Older Americans Month
Presentation - Historic Preservation Month
Proclamation - Mental Health Matters Month
Proclamation - AAPI Heritage Month
LLAD FY 24/25 Engineer's Report Set Public Hearing Date Traffic Calming Program Update
2024 Water Supply Update
CalGreen Building Code
May 21, 2024: 6:30 p.m.

Proclamation - Memorial Day
Proclamation - Public Works Week
Proclamation - Bike Month
Presentation - Juneteenth 2023 Event
LLAD FY 24/25 Engineer's Report
Proposed FY 24/25 Budget
Salary Schedule Adjustment for FY24/25
Kids Commerce Fee Waiver
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American Canyon City CouncilApril 2, 2024

American Canyon City Council
April 2, 2024