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CITY COUNCIL AGENDA
May 28, 2025
SPECIAL MEETING - 5:30 P.M.
ANDERSON CITY HALL
1887 Howard Street
PARTICIPATION BY PUBLIC IN MEETING
Please review the Agenda to determine if the subject you wish to discuss is scheduled for Council consideration. If it is on the Agenda, you will have an opportunity when that matter comes up for discussion to briefly address the Council.
If the subject is not on tonight's Agenda, please complete an Agenda Request Form (on Clerk's table) and present it to the City Council Clerk. You will have the opportunity to speak on the subject under Item 5.2. However, if the item is not on the Agenda, each speaker will be limited to one three (3) minute opportunity to speak, unless the City Council makes an exception due to special circumstances.
The Brown Act prohibits the Council from taking action on any item not placed on the printed Agenda in most cases.
Thy Council less gane hours before a real domeng or be made avalaed to menibers of the public at the same time they are distributed.
In compliance with the Americans with Disabilities Act, the City of Anderson will make available to shem contache pably clerks elice (37-ace to make sucha request. Nots cation 72 Murs bir to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this This is an Equal Opportunity Program. Discrimination is prohibited by Federal Law.
Complaints of discrimination may be filed with the Secretary of Agriculture, Washington, D.C. 20250.
City Council Meeting
May 28, 2025
1.0 ROLL CALL - COUNCIL:
Councilmember Simmons
Councilmember Gallagher
Councilmember Hale
Vice-Mayor Gallier
Mayor Baugh
2.0 INVOCATION - Councilmember Mike Gallagher
3.0 PLEDGE OF ALLEGIANCE - Vice Mayor Dan Gallier
PUBLIC WORKS
8.9 REVISED WASTEWATER RATE STUDY REPORT
RECOMMENDED ACTION:
1. Receive a Staff Report;
2. Receive a report from the City's consultant, Lechowicz + Tseng Municipal Consultants.
3. Authorize staff to proceed with Proposition 218 noticing.
14.0 ADJOURN - The City Council will adjourn to June 3, 2025.
AGENDA ITEM
OF ANDERS
A, May 28, 2025, City Council Meeting
Approved for Submittal By:
Joey Forseth-Deshais, City Manager
To Be Pfesented By:
Adam helen, Public Works Director
To: Honorable Mayor and Members of the Anderson City Council Through: Joey Forseth-Deshais, City Manager
From: Adam Whelen, Public Works Director
Date: May 28, 2025
SUBJECT
Revised Wastewater Rate Study Report
RECOMMENDATION
The Public Works Director recommends that the City Council:
1. Receive a Staff Report;
2. Receive a report from the City's consultant, Lechowicz + Tseng Municipal Consultants.
3. Authorize staff to proceed with Proposition 218 noticing.
FISCAL IMPACT
Increased rate-payer revenue will fund the cost of service and maintain a reserve fund for emergencies and unforeseen circumstances.
DISCUSSION and BACKGROUND
In 1998, the City conducted its first sewer rate study to assess the sewer user fee rates after operating losses in the Wastewater Enterprise Fund. Since 1998, the City has proposed sewer user rate increases of a modest nature by increasing monthly flat rate charges and additional charges based on each 100 cu. foot of water consumed. These flat rate charges range between 2% to 3% per cycle. In 2014, this ideology shifted from 3% to 5% for 2014 and 2015. Over the last 27 years, the City has only proposed a rate increase five times.
ITEM 8.9 PAGE 1 5/28/2025
Consumers of the City's sewer service are charged user fees to maintain our sewer system.
Each year, staff analyzes the revenues and expenditures in the Wastewater Enterprise Fund, comparing the service's costs with user revenues. To keep up with inflationary costs, the City typically imposes small increases in user fees each year. The last rate increase was done in 2014, with an increase of 5% for 2014 and 2015.
For the fiscal year 2015, the wastewater enterprise fund started with a reserve balance of $7,203,170, and in 2015, there was a decrease in reserves of $1,123,273. In fiscal year 2020, there was a decrease in reserves of $542,991; again, in the fiscal year 2022, there was a decrease in reserves of $170,071. In the fiscal year 2024, there was a decrease in reserves of $2,471,357. Expenditures continue to outpace revenues in the wastewater fund, leaving an approximate reserve balance of $4,393,760 at the beginning of the fiscal year 2024/2025.
Much like the General Fund reserve, having a healthy reserve in the wastewater enterprise fund is essential. Traditionally, the reserve is used for planned and unexpected sewer infrastructure repairs. The sewer system comprises a wastewater treatment plant, over 50 miles of sewer lines, and five municipal lift stations. An unexpected repair on any of the many sewer system components could quickly deplete the reserves in the wastewater enterprise fund.
The City Wastewater Department faces a significant challenge in repairing aging infrastructure that often breaks down, resulting in sewer backups and failures. However, constantly responding to such issues leaves little time to focus on preventing future occurrences that would extend the lifespan of the sewer system.
There are several key reasons why operating costs have quickly outpaced the rate increases implemented in the past. Utility rates, unfunded state mandates, and aging sewer lines are all significant factors that impact rates.
In the past, the City has upgraded the pumps and motors to make them as energy-efficient as possible, but increased energy costs have offset the decrease in energy usage. The wastewater treatment plant has not received significant upgrades since 1989. Additionally, the majority of the needed projects identified in the 2007 Master Sewer Plan for the collection system have not been completed.
Every year, new mandates are introduced for increased testing and reporting. The number of compounds tested for and the frequency of tests have continued to rise. Moving forward, the previously stated costs are expected to continue increasing.
As stated, small rate increases have occurred regularly to keep up with rising costs. These rate increases were generally determined by City staff reviewing revenue versus expenditures and making an educated estimate of future expenses.
The City of Anderson strives to maintain our affordable sewer rates. Our sewer service remains a tremendous value for our residents. A rate increase is needed to maintain a sustainable sewer utility for our citizens.
ITEM 8.9 PAGE 2 5/28/2025
Lechowicz + Tseng Municipal Consultants reported their draft findings and report to the City Council as a regular agenda item on February 18, 2025. No comments from the public were received.
Before the regular meeting on May 20, 2025 the Public Hearing for the rate increase was removed from the agenda as a discrepancy in how the base rates were calculated was discovered. City staff met with Lechowicz + Tseng to discuss how to resolve this issue.
Protests received during the original Proposition 218 period were counted; 189 written protests were counted.
At the May 20, 2025 meeting, numerous citizens voiced their concerns about how the rate increase would adversely affect them. With the large year one increase and the base rate adjustment, staff has changed the proposed rate increase structure to the City Council. Staff proposes phasing the base rate calculation adjustment over 5 years to offset the initial customer increase. The Proposition 218 mailer includes a sample bill for a 2,500-square- foot professional office space and a sample residential bill. Also, staff proposes an informational public meeting on June 26, 2025 at 5:30 pm at Scout Hail in Anderson River Park. After the informational meeting for those interested, a tour of the Anderson wastewater treatment plant will occur.
In November 1996, California voters approved Proposition 218, the "Right to Vote on Taxes Act," which added Articles 13C and 13D to the California Constitution. Wastewater rates/revenues must:
• Be based on the reasonable cost of services.
• Costs must be proportionally recovered based on how customers take services. • Only be used for the wastewater utility.
The procedural requirements to raise the wastewater rates include:
• Conducting a rate study.
• Mailing notices to property owners (A protest form will be included in the mailer). • Tally the number of protests.
• Hold a public hearing a minimum of 45 days after the notices are mailed.
Council vote. Rates cannot be adopted if more than 50% of ratepayers submit written protests.
The proposal before the council is to increase water rates by approximately 65% for 2025, followed by a 65% increase for 2026 and then a 13% increase for the next three years. • The first increase is proposed to be effective on August 1, 2025.
Future rate increases are proposed to be effective on July 1 of each year through July 1, 2029.
The new date for the public hearing will be July 15, 2025 to ensure that this increase makes it onto the 2025 assessors' tax roll. A new Proposition 218 mailer will be sent out to all property owners who have sewer service within the City of Anderson; a copy of the mailer is included as Attachment 2. Property owners who initially protested the rate increase for ITEM 8.9 PAGE 3 5/28/2025
the May 20, 2025 Public Hearing will need to complete a new protest form for their protest to be counted.
ATTACHMENT
1. Recommendations Presentation Slides
Final Sewer Rate Study 2025 (May 2025), Lechowicz + Tseng Municipal Consultants
2. Proposition 218 Mailer
ITEM 8.9 PAGE 4 5/28/2025
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Corabled
183:
parated January
WASTEWATER RATE STUDY 2025
REVISED SEWER RaTE
RECOMMENDATIONS
CITY COUNCIL MEETING
MAY 28, 2025
LECHOWICZ+ TSENG
MUNICIPAL CONSULTANTS
BACKGROUND
DATE ACTION
2002 Last Sewer Rate Study
2007 Last Sewer Master Plan
2015 Last sewer rate increase
Fall 2024 Begin new Sewer Rate Study
Feb 2025 Present draft recommendations
Present final recommendations; Send out mailers and & set April 2025
May 20, 2025 as Prop 218 Hearing
May 2025 Prior to May 20, discovered inconsistency in how the Base Rate is charged to some customers
SEWER RATE STUDY OVERVIEW
• Wastewater Fund is an Enterprise Fund
• Self supported from rates and charges
• Separate from General Fund
• No tax revenue received
• City does not make a profit
Last rate increase was in October 2015
• Last comprehensive rate study was in 2001
• Since 1998, the City has only implemented inflationary rate increases 5 times Wastewater system needs significant infrastructure improvements • Treatment plant still has capacity but has not been upgraded since the 1980's • $11.OM in capital projects planned for the next 5 years • Rate study covers 5-year period (FY2026 through FY2030) - New rates effective August 1, 2025 through July 1, 2029 - Sewer is billed annually on the property tax roll
PROPOSITION 218
Adopted by California voters in 1996 and added Articles 13C and 13D to the California Constitution
• Governs how property-related charges are adopted
• Rates must be based on the reasonable cost of service - Rates must proportionally recover costs based on how customers take service • Revenues from rates can only be used for intended purpose Covers rates over a 5-year period
Procedural Requirements:
- Conduct a rate study
• Mail a notice to property owners
- Hold a public hearing a minimum of 45 days after the notice is mailed Rates cannot be adopted if more than 50% of ratepayers submit written protests
WASTEWATER SYSTEM OVERVIEW
System includes wastewater treatment, collection, and disposal facilities
• Treatment plant was originally built in 1974 and upgraded in the 1980's to a modern Class IV, 2 million-gallon-per-day (MGD) tertiary wastewater treatment plant
Collection system includes 50 miles of sewer mains, 747 manholes, & 5 pump stations that convey raw sewage to the plant
Treated outflow is discharged to the Sacramento River
• Sewer customers = 3,400, Annual Flow = 307,500 ccf
WHY RATES ARE BEING INCREASED
• Last sewer rate increase was 10 years ago in 2015
• Meet debt service coverage ratio
• Net revenues = 1.25 times total annual debt service payments • Pay for deferred capital improvement projects
- For maintenance & operations only
• Not for upgrades due to new development
- Comply with State mandates for testing and reporting
Eliminate sewer operating deficit (expenses exceed revenues) Retain positive credit rating to obtain grants, loan, and other debt financing
CURRENT MONTHLY SEWER RATES
Monthly Sewer Rates for All Customers [1]
Effective Date Oct 1, 2015
Base Rate Per Month $22.44
Additional Flow Charge (per ccf) [2] $1.38
1 - Customers are billed annually on the property tax roll 2 - Per one hundred cubic feet (ccf) consumed during the winter months (Oct through March). 1 ccf = 748 gallons
BASE RATE: ADDITIONAL FLOW CHARGE:
All customers are charged a fixed base All customers are billed for average charge consumption during the winter months
(Oct - Mar)
Recovers fixed expenses, ex. staffing,
customer service, system maintenance, Recovers expenses that can vary, ex. and repairs utilities and chemicals
• Currently recovers 76.0% of total sewer Currently recovers 24.0% of total sewer rate revenues rate revenues
CURRENT AVERAGE SFR SEWER BILL
Average Single Family Residential Sewer Bill
Monthly Bill
Base Rate $22.44
Flow Charge (5 ccf) $6.90
Total Monthly Bill $29.34
Annual Bill
Base Rate $269.28
Flow Charge (60 ccf) $82.80
Total Annual Bill $352.08
Average single family residential flow = 5 ccf/month
$80.76 City of Shasta Lake
$73.00 City of Mt. Shasta
$70.75 City of Redding
$61.26 City of Yreka
Meadows
$58.88
CSA 13 Alpine
Monthly Wastewater Bill Survey - January 2025 Single Family Residential - 5 ccf/month $58.00 City of Dunsmuir 55,66 $: CSA 17 Cottonwood
$34.00 City of Red Bluff
$32.73 Burney Water District
$29.34 Anderson (Current)
$29.23 City of Weed
$90 $80 $70 $60 $50 $40
FINANCIAL OVERVIEW
Actual Actual Actual Actual Actual Budget
2019/20 2020/21 2021/22 2022/23 2023/24 2024/25
REVENUES
Sewer User Fees $1,729,673 $1,802,446 $1,735,936 $1,777,714 $1,754,680 $1,778,696 Interest Earnings $44,680 $11,580 $11,580 $40,000 $12,000 $12,000 Other Revenue $7,076 $5,134 $5,134 $6,500 $6,000 $6,000 Sewer Transfers In [1] $677,937 $677,937 $104,296 $42,821 $109,318 Total Revenues $1,781,429 $2,497,097 $2,430,587 $1,928,510 $1,815,501 $1,906,014
EXPENSES
Operating Expenses $2,738,451 $3,542,304 $1,889,001 $1,837,198 $2,271,549 $2,005,896 Debt Service $227,865 $225,314 $228,001 $225,063 $227,501 $229,202 Capital Projects $0 $0 $0 $0 $0 $0
Total Expenses $2,966,315 $3,767,618 $2,117,002 $2,062,261 $2,499,050 $2,235,098 NET TOTAL REVENUES ($1,184,886) ($1,270,521) $313,586 ($133,751) ($683,550) ($329,084) 1 - For 2022/23, 2023/24 and 2024/25, Transfers In are assumed to be assessment revenues to pay for debt service.
The Wastewater Fund has been operating in a deficit
(expenses exceed revenues)
10 Wastewater Fund
Cash Fund Balance History
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
2015 2016 2017 2018 2019 2020 2021 2022 2023
Fiscal Year Ending
The last sewer rate increase was in 2015.
Since then, cash reserves have decreased by 56%
DEBT SERVICE COVERAGE RATIO
• Wastewater Fund has 3 outstanding debt obligations:
2001 USDA Revenue Bonds for $2,076,000
- 2001 Riverside COPs for $232,570
- 2007 CSCDA Revenue Bonds for $1.6M
• Total annual debt service payments = $228,000
• Coverage ratio is a financial measure of an agency's ability to repay outstanding debt
Ratio requires that annual water net revenues (gross revenues less 0&M expenses) must be at least 1.25 times the combined annual debt service payments on all parity obligations
Calendar Year 2021 2022 2023 2024
Debt Service Coverage Ratio -0.53 -0.74 -2.66 -3.81
Failure to meet the coverage ratio on an annual basis is considered to be technical default
Could lead to a rating downgrade and may impact the City's ability to obtain additional debt funding in the future
=
WASTEWATER CIP (FY2026 - 2030)
PROJECTED TOTAL Annual
Item # Project 2025/26 2026/27 2027/28 2028/29 2029/30 COST Average
WASTEWATER TREATMENT PLANT
Updated master sewer plan $1,500,000 $1,500,000
Mechanical screen at headworks $85,000 $85,000 $85,000 $255,000 Upsized influent pumps $50,000 $50,000 $50,000 $150,000 Emergency influent pump $200,000 $200,000
40 HP aerators $100,000 $100,000 $100,000 $100,000 $400,000 Recoat ballast pond $140,000 $140,000
Replace filter pumps/motors $100,000 $100,000
Add fourth pressure filter $2,750,000 $2,750,000
Rehab contact chamber $1,250,000 $1,250,000
10 Electrical upgrade through WWT $500,000 $500,000 $500,000 $500,000 $500,000 $2,500,000 11 Upgrade main facility/SCADA $170,000 $170,000 $170,000 $170,000 $170,000 $850,000 12 Rehab and inspect outfall at river $50,000 $50,000 $50,000 $50,000 $50,000 $250,000 Total Treament Plant Projects $2,470,000 $955,000 $1,095,000 $905,000 $4,920,000 $10,345,000 $2,069,000
COLLECTION SYSTEM
Inflow & Infiltration (1&l) Projects $700,000 $700,000 $700,000 $700,000 $700,000 $3,500,000 Total Collection System Projects $700,000 $700,000 $700,000 $700,000 $700,000 $3,500,000 $700,000
VEHICLE REPLACEMENTS
Replacement Vac-Truck $750,000 $750,000
Camera Van $100,000 $100,000
Vehicle replacement $65,000 $65,000 $130,000
Front Loader [2] $80,000 11 $80,000
Total Vehicle Replacements $80,000 $0 $0 $65,000 $915,000 $1,060,000 $212,000 TOTAL PROJECTS $3,250,000 $1,655,000 $1,795,000 $1,670,000 $6,535,000 $14,905,000 $2,981,000 TOTAL PROJECTS (COSTS ESCALATED) $3,412,500 $1,824,638 $2,077,937 $2,029,895 $8,340,500 $17,685,470 $3,537,094 Total 5-Year CIP = $17,685,470
13 WASTEWATER CIP SUMMARY
Wastewater treatment plant has not received significant upgrades since 1989 Collection system is comprised of aging infrastructure that often breaks down, resulting in sewer backups and failures
City has upgraded the pumps and motors to make them as energy-efficient as possible, but increased energy costs have offset the decrease in energy usage.
The majority of the needed projects identified in the 2007 Master Sewer Plan for the collection system have not been completed
Proposed rates will pay for $11.0 million in capital projects, including an updated Master Sewer Plan, replacing sewer pipelines, upgrading electrical equipment, new pressure filter, and vehicle replacements All projects will be cash-funded. No grant or loan funding. 14 HOUSEHOLD EQUIVALENT (HE)
The assignment of HEs to each customer class represents each customer's proportional impact on the overall sewer system One HE is defined as the wastewater flow and pollutant loading of the average single family dwelling unit in the City
For all other customers, the factors have been updated based on industry-standard estimates of wastewater volume and pollutant loadings
The number of HEs for some commercial customers may increase while other customer classes may decrease
To mitigate rate impacts, customers that will see an increase will have their total HE's phased-in over the next five years 15 EXAMPLE HE CALCULATION
• For a commercial customer with 2,500 sq ft of professional office space with winter average use of 8 ccf
• HE calculation for Professional Office = 0.8 / 1,000 sq ft
0.8 x 2,500 sq ft/1,000 = 2 HE
Sewer Bill Calculation (based on current rates)
Monthly Monthly Annual
Rate Units Bill Bill
Base Rate $22.44 2 HES $44.88 $538.56
Flow Charge $1.38 8 ccf $11.04 $132.48
Total $55.92 $671.04
16 REDUCED MULTI-FAMILY RATE
Multi-Family Residential customers are currently assigned 1.0 HE per unit • Typically use less water than single-family customers Examples from other agencies:
Redding Sacramento Shasta Lake Red Bluff
Single Family $70.75 $25.35 $69.63 $34.00
Multi-Family $52.35 $19.01 $59.19 $24.00
Ratio 0.74 0.75 0.85 0.71
Recommendation: Reduce Multi-Family HE to 0.74 HE
Avg Monthly Flow
Current No. of HES Monthly Flow (ccf)
Single Family 2,980 14,053 4.7
Multi-Family 1,508 5,315 3.5
MF/ SF Ratio 0.74
17 COMPARISON OF PROPOSED RATES
Current Projected
2024/25 2025/26 2026/27 2027/28 2028/29 2029/30
May 20 Proposed Rates
Revenue Increase % 160.0% 7.0% 7.0% 7.0% 7.0%
Avg SFR Monthly Bill (5 ccf) $29.34 $76.44 $81.78 $87.51 $93.64 $100.19 Annual Sewer Rate Revenues $1,778,000 $4,646,000 $4,996,000 $5,372,000 $5,777,000 $6,212,000 Annual CIP Funding $0.00 $2,212,268 $2,212,268 $2,212,268 $2,212,268 $2,212,268 Debt Service Coverage Ratio (1.25x) -1.14 9.78 10.76 11.84 13.03 14.33 Ending Fund Balance $586,359 $382,708 $405,158 $675,809 $1,218,659 $2,058,710 Revised Proposed Rates
Revenue Increase % 65.0% 65.0% 13.0% 13.0% 13.0%
Avg SFR Monthly Bill (5 ccf) $29.34 $48.17 $79.11 $88.94 $99.99 $112.47 Annual Sewer Rate Revenues $1,778,000 $2,699,000 $4,679,000 $5,407,000 $6,225,000 $7,160,000 Annual CIP Funding $0 $300,000 $1,500,000 $2,300,000 $2,900,000 $4,000,000 Debt Service Coverage Ratio (1.25x) -1.14 1.27 9.37 12.01 15.00 18.47 Ending Fund Balance $586,359 $347,976 $764,694 $986,612 $1,292,731 $1,294,049 18 PROPOSED MONTHLY SEWER RATES
Current Projected
2024/25 2025/26 2026/27 2027/28 2028/29 2029/30
Base Rate (per HE) ") $22.44 $36.72 $60.21 $67.59 $75.89 $85.22 $ Change $14.28 $23.49 $7.38 $8.30 $9.33
% Change 63.6% 64.0% 12.3% 12.3% 12.3%
Flow Charge (per cf) |2| $1.38 $2.29 $3.78 $4.27 $4.82 $5.45 $ Change $0.91 $1.49 $0.49 $0.55 $0.63
% Change 65.9% 65.1% 13.0% 12.9% 13.1%
1 - HE = household equivalent
2 - Per one hundred cubic feet (ccf) consumed during the winter months (October through March). 1 ccf = 748 gallons Funds all operating costs, including debt service
Pays for $11.OM in capital projects over the next 5 years Meet debt service coverage in 2025/26
Meet reserve fund target by 2029/30
Annual Cost Escalators: 6.0% for Salaries & Benefits, 7.0% for Utilities,
5.0% for Chlorine, & 3.0% for all other expenses
Solar Project is not included in this study
19 RESIDENTIAL BILL IMPACTS
Current Projected
2024/25 2025/26 2026/27 2027/28 2028/29 2029/30
Monthly Bill
Base Rate $22.44 $36.72 $60.21 $67.59 $75.89 $85.22
Flow Charge (5 ccf) $6.90 $11.45 $18.90 $21.35 $24.10 $27.25 Total Monthly Bill $29.34 $48.17 $79.11 $88.94 $99.99 $112.47 $ Change $18.83 $30.94 $9.83 $11.05 $12.48
% Change 64.2% 64.2% 12.4% 12.4% 12.5%
Annual Bill
Base Rate $269.28 $440.64 $722.52 $811.08 $910.68 $1,022.64 Flow Charge (60 ccf) $82.80 $137.40 $226.80 $256.20 $289.20 $327.00 Total Annual Bill $352.08 $578.04 $949.32 $1,067.28 $1,199.88 $1,349.64 $ Change $225.96 $371.28 $117.96 $132.60 $149.76
% Change 64.2% 64.2% 12.4% 12.4% 12.5%
Bill impacts will vary based on actual monthly winter usage 20 Projected Wastewater Revenues & Expenses
$8,000,000
Operating Expenses
Debt Service
$7,000,000 Capital Projects ($11M Total)
- Current Sewer Revenues
-Projected Revenues with Rate Increases
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
Current Sewer Revenues = $1.9M
$1,000,000
$0
2024/25 2025/26 2026/27 2027/28 2028/29 2029/30
Current Projected
21 $80.76 City of Shasta Lake
$73.00 City of Mt. Shasta
$70.75 City of Redding
$61.26 City of Yreka
$59.00 City of Dunsmuir
$58.88 CSA 13 Alpine Meadows
Monthly Wastewater Bill Survey - January 2025 Single Family Residential - 5 ccf/month Yreka and Redding have adopted sewer rate increases through 2027/28 $55.66 CSA 17 Cottonwood
$48.17 (Proposed 8/1/25) Proposed 2025/26
Anderson
$34.00 City of Red Bluff
$32.73 Burney Water District
$29.34 (Current)
Anderson
$29.23 City of Weed
$90 $80 $70 $60 $50 $40
NEXT STEPS
DATE ACTION
May 28, 2025 Present revised rate recommendations to City Council; Council votes to proceed with Prop 218 process
May 30, 2025 Mail out Prop 218 Notices (46 days prior to hearing) July 15, 2025 Prop 218 Hearing. First rate increase goes into effect on August 1, 2025. Future rate increases will be effective July 1 of each year beginning on July 1, 2026 through July 1, 2029
August 1, 2025 City submits sewer bills for the property tax roll to the County =
23 QUESTIONS?
24 AND BISON
1972
111:
NOTICE OF RESCHEDULED PUBLIC HEARING TO
INCREASE SEWER SERVICE FEES
Tuesday, July 15, 2025, at 5:30 pm
May 30, 2025
Dear Sewer Customer:
In April 2025, the City of Anderson mailed a notice to inform customers that the City is considering the adoption of increases in the City's sewer service fees. The previous proposed sewer service fees included a 160.0% increase in the first year. After thoroughly reviewing the bill impacts to ratepayers, the City proposes to phase in sewer rate increases over the next five years to minimize the initial impact to customers while funding essential operating and capital costs for the Sewer Fund.
The purpose of this notice is to inform you of the proposed revised sewer service fees. Accordingly, the City has rescheduled the Public Hearing to Tuesday, July 15, 2025, at 5:30 pm to consider the proposed rate adjustments.
Why is a sewer rate increase needed?
Since 1998, the City has only increased sewer rates five times. The last sewer rate increase was ten years ago in 2015. The City's current rates are among the lowest in the region. The City is committed to providing our customers the highest quality sewer utility services at the lowest possible rates. To meet this commitment, the City monitors the cost of providing sewer services, including the infrastructure needs, programs, and operations and maintenance costs of the City's sewer services. We strive to look for ways to reduce costs, thus keeping rates for our users as low as possible.
As an enterprise fund, the Sewer Fund is separate and distinct from the City's General Fund and relies entirely on rate revenues to fund its operations. Sewer operations are not funded by property tax or any other tax revenue. The charges for sewer service appear on your property tax bill because that is the least costly way for the City to collect the charges. However, the sewer service fees are not a tax.
The City can no longer provide you with the quality service you have come to expect at our current rates.
The Sewer Fund will continue to operate in a deficit if rates are not adjusted because our costs to provide you with sewer service have continued to increase. In addition to rising increases in utility and regulatory costs to meet State compliance mandates, the City needs to replace significant portions of the City's aging sewer treatment, collection, and disposal facilities, which have not been updated in over 40 years.
Over the next five years, the City proposes to spend $11.0 million in capital projects to rehabilitate equipment and other sewer system infrastructure.
The City engaged an independent rate consultant who reviewed the sewer utility's cost of providing service to determine appropriate adjustments to the sewer service fees. The proposed rates are based on the reasonable cost of providing service and do not exceed the proportional cost of the service attributable to each parcel. Sewer service fee increases are necessary to: (a) enable the City to recover current and projected costs of operations and maintenance; (b) pay existing debt service obligations; (c) fund capital infrastructure maintenance needed to repair the aging sewer system; (d) maintain operational and financial stability; and (e) avoid further depletion of reserves.
Sewer Rate Structure
Sewer service fees are billed annually on the property tax roll. The City's sewer service fees are comprised of two components: (1) a fixed monthly Base Charge; and (2) a Flow Charge imposed for each one hundred cubic foot of water consumed during the winter months (October through March). One hundred cubic feet (CCF) of water is equivalent to 748 gallons.
The Flow Charge is determined on the basis of each property owner's water use during the winter months because individual sanitary sewer flows are not metered; water consumption during the winter best reflects actual flows into the sanitary sewer system when outdoor water use is least likely to occur.
Each customer class is assigned a Sewer Household Equivalent Factor (HE) for the Base Charge. One HE is defined as the wastewater flow and pollutant loading of the average single family dwelling unit in the City. The assignment of HEs to each customer class represents each customer's proportional impact on the overall sewer system.
The current number of HEs assigned to each customer was established by the last sewer rate study in 2002. For this study, the proposed sewer rates and number of HE's have been updated to reflect industry- standard estimates of wastewater volume and pollutant loadings. As a result, the number of HEs for some customers are proposed to increase while others are proposed to decrease. To mitigate rate impacts, customers who receive increases will have their total HE's phased-in over the next five years.
The list of Household Equivalence Factors is located with the Public Works Department. For example, for a commercial customer with approximately 2,500 square feet (sq ft) of professional office space. The calculation is 0.8 × 2,500 sq ft/1,000 = 2 HE. Please call the Public Works Department at (530) 378- 6641 if you need assistance determining your customer class and/or calculating your number of HEs. 2 Proposed Sewer Rates
The current and proposed rates for the City's sewer service fees are set forth in the following table.
If adopted, the first rates adjustment will go into effect on August 1, 2025. Subsequent increases will be implemented on July 1 of each year beginning on July 1, 2026 through July 1, 2029.
Proposed Monthly Sewer Rates
Effective Date
Current Aug 1, 2025 July 1, 2026 July 1, 2027 July 1, 2028 July 1, 2029 Base Rate (per HE) ') $22.44 $36.72 $60.21 $67.59 $75.89 $85.22 Flow Charge (5/per CCF) 12) $1.38 $2.29 $3.78 $4.27 $4.82 $5.45 1 - Base Rate is multiplied by the number of Sewer Household Equivalents (HEs) 2 - Per one hundred cubic feet (CCF) of water consumed during the winter months (October through March). One CCF = 748 gallons.
Proposed Monthly Bill for a Typical Single Family Residential Customer The table below includes sample monthly bill impacts for a typical single family residential customers that uses 5 CCF of water per month in the winter. Bill impacts for each customer will depend on actual water consumption during the winter months of October through March.
Average Monthly Single Family Residential Sewer Bill
Effective Date
Current Aug 1, 2025 July 1, 2026 July 1, 2027 July 1, 2028 July 1, 2029 Base Rate $22.44 $36.72 $60.21 $67.59 $75.89 $85.22
Flow Charge (5 CCF) $6.90 $11.45 $18.90 $21.35 $24.10 $27.25 Total Monthly Bill $29.34 $48.17 $79.11 $88.94 $99.99 $112.47 The following chart shows a bill survey comparing the City's current and proposed monthly sewer bill for a typical single family residential customer who uses 5 ccf per month during the winter. The City's monthly sewer bill is currently amongst the lowest in the region. Many of the surveyed agencies are also facing impending rate increases.
3 Single Family Residential Monthly Wastewater Bill Comparison 5 ccf/month
$100
$90
$80
$70 $80.76
$70.75 $73.00
$60
$55.66 $58.00 $58.88 $61.26
$48.17
$29.23 $29.34 $32.73 $34.00
City of Weed Anderson Clty of Red Bluff Anderson (Proposed 8/1/25) CSA 17 Cottonwood Clty of Dunsmuir Sheadpine City of Yreka City of Redding City of Mt. Shasta City of Shasta Lake Burney Water District
Sewer Bill Calculation for Commercial Customers
To calculate the sewer bill for commercial customers, first, calculate the number of HEs based on your customer category and square footage. Then multiply the number of HEs by the Base Rate. Next, multiply your average consumption for the months of October through March by the Flow Charge. The following shows how the monthly sewer bill would be calculated for a commercial customer with a 2,500 square foot office with winter average consumption of 8 ccf.
HE Calculation for Professional Office = 0.8 x 1,000 sf
0.8 x- 2,500 sf 2 HES
1,000 sf
Sewer Bill Calculation for Professional Office
Proposed Proposed
July 1, 2025 Monthly
Rate Units Bill
Base Rate $36.72 × 2 HES = $73.44
Flow Charge $2.29 8 ccf = $18.32
Total Bill $91.76
4 Public Hearing
The City Council will hold a Public Hearing on Tuesday, July 15, 2025 at 5:30 pm in the City Council Chambers, which is on the third floor of City Hall located at 1887 Howard Street, Anderson, CA, to consider the proposed recommendations for the rate increases to the City's sewer service fees.
Any property owner of a parcel upon which the sewer service fees will be imposed and/or any tenant directly responsible for the payment of sewer service fees (i.e., a customer of record) may submit a written protest to the proposed increases to the City's sewer service fees. However, only one protest will be counted per identified parcel.
If you submitted a protest to the original Proposition 218 Notice, you will need to submit a new protest to oppose the proposed rate increases set forth in this notice.
All written protests MUST include ALL of the following to be counted:
1. State that the identified property owner or customer of record is in opposition to the proposed increases;
Provide the location of the identified parcel (by assessor's parcel number or street address);
Include the name and signature of the property owner or customer of record submitting the protest.
Written protests may be submitted by:
1. Mail to: City Clerk Christy White, 1887 Howard Street, Anderson, CA, 96007; or
2. In-person delivery during City business hours at 1887 Howard Street, Anderson, CA, 96007; or
3. At the Public Hearing on Tuesday, July 15, 2025, at 5:30 pm.
For your convenience, you may fill out and submit the enclosed protest form and return it to City Clerk Christy White at the above address. Regardless of how the written protest is submitted, it must be received by the City prior to the conclusion of the public comment portion of the Public Hearing (date and time noted above). Any protest submitted via e-mail or other electronic means will not be accepted. Please identify on the front of the envelope for any written protest, whether mailed or submitted in person to the City Clerk, that the enclosed protest is for the Public Hearing on the Proposed Sewer Service Fees.
The City Council will hear and consider all written and oral protests to the proposed rate increases at the Public Hearing. Oral comments at the Public Hearing will not qualify as formal protests unless accompanied by a written protest. Upon the conclusion of the Public Hearing, the City Council will consider the adoption of the proposed increases in rates for sewer services as noted in this letter. If a majority of property owners or customers of record do not protest the proposed increase, the City Council will have the authority to impose the proposed rates. If adopted, the proposed rates for the sewer service fees will be in effect beginning August 1, 2025.
5 Pursuant to California Government Code 53759, there is a 120-day statute of limitations for challenging any new, increased, or extended fee adopted, modified, or amended by the City of Anderson. All written objections must be submitted before the end of the public hearing as stated above and a failure to timely object in writing bars any right to challenge that fee or assessment through a legal proceeding.
If you have any questions about this proposal, the Public Works Department can be reached at (530) 378-6641 during regular business hours. A complete copy of the consultant's report to the City Council will be available on our website at www.ci.anderson.ca.us or in person in the City Clerk's Office at City Hall 72 hours prior to the scheduled Public Hearing.
Wastewater Treatment Plant Tour
To learn more about the sewer system, the City invites you to take a free public tour of the Wastewater Treatment Plant on Thursday, June 26, 2025, at 5:30 pm. Please meet at Scout Hall in Anderson River Park, and then City staff will lead the walk to the treatment plant.
The City of Anderson is committed to providing quality services at a reasonable cost. We continue to meet the strict State standards for sewer treatment and disposal, along with providing excellent customer service.
Sincerely,
Joey Forseth-Deshais
City Manager
For more information, scan the QR code or visit
https://ci.anderson.ca.us/departments/public_works//wastewater.php
PROTEST FORM FOR SEWER SERVICE FEES
I certify that I am the legal owner of the property receiving City of Anderson sewer service and/or am a customer of record. I wish to protest the proposed rate increases as indicated below:
My property receives City of Anderson sewer services, or 1 am a tenant directly liable for the payment of sewer service fees, and I protest the proposed sewer rate increases.
Print Name Signature
Property Address Assessor's Parcel No.