From: Rhea Varley
To: Beth Redfern
Subject: FW: Old Business a. Adopt Resolution No. 256-18 Authorizing Staff to Initiate the Proposition 218 Process for Adjustments to the City of Arcata’s Water and Wastewater Rates.
Date: Tuesday, February 3, 2026 10:30:41 AM
For Blue Folder.
From: Gregory Daggett < >
Sent: Tuesday, February 3, 2026 10:18 AM
To: Meredith Matthews <[email protected]>; Stacy Atkins-Salazar <[email protected]>; Alex Stillman <[email protected]>; Kimberley White <[email protected]>; Sarah Schaefer <[email protected]>; Tabatha Miller <[email protected]>; David Loya <[email protected]>; Rhea Varley <[email protected]>; Merritt Perry <[email protected]>; Engineering Dept <[email protected]>; Emily Sinkhorn <[email protected]> Subject: Old Business a. Adopt Resolution No. 256-18 Authorizing Staff to Initiate the Proposition 218 Process for Adjustments to the City of Arcata’s Water and Wastewater Rates.
CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you recognize the sender and know the content is safe.
Dear City Council and City leadership,
Here are my questions regarding Adopt Resolution No. 256-18 Authorizing Staff to Initiate the Proposition 218 Process for Adjustments to the City of Arcata’s Water and Wastewater Rates.
Sincerely,
Gregory Daggett
A. Past rate increases (FY 2021–FY 2025): “How much came in, where did it go?”
1. Actual dollars from prior increases
Question: For each year FY 2021–FY 2025, how much additional annual revenue did the adopted water and wastewater rate increases generate, in dollars, compared to the prior year?
Follow‑up: Please provide a table showing, by year and utility: adopted % increase, projected additional revenue, and actual additional revenue.
2. Use of that additional revenue
Question: For each of those years, how was the additional revenue from the rate increases spent?
Follow‑up: Break it down by category:
Operations and maintenance
Capital projects (itemized by project)
Debt service
Transfers between funds
Change in reserves
3. Deviation from the 2020 rate study
Question: How do actual revenues, expenses, CIP spending, and reserves for FY 2021–FY 2025 compare to what was projected in the 2020 water/wastewater rate study?
Follow‑up: Where did reality diverge from the plan, and what specific factors caused those deviations?
4. Water Fund shortfall and “potential insolvency”
Question: Given the 37% water rate increase in FY 2021 and subsequent increases, what specific factors led to the Water Fund’s shortfall and “potential long‑term insolvency”?
Follow‑up: Were there cost overruns, unplanned projects, lower‑than‑projected demand, or policy decisions that contributed?
B. $3.5 million loan from Wastewater to Water
5. Loan terms and rate impacts
Question: What are the full terms of the $3.5 million loan from the Wastewater Fund to the Water Fund (interest rate, repayment schedule, duration, and legal authority)?
Follow‑up: How is repayment of this loan incorporated into the proposed FY 2026–FY 2030 water and wastewater rates, and what is the impact on wastewater ratepayers?
C. Cal Poly Humboldt: “How much will they pay, and who are they shifting costs to?”
6. Customer class and cost allocation
Question: How is Cal Poly Humboldt classified in the cost‑of‑service analysis (its own class, or grouped with other large institutional/commercial users)?
Follow‑up: What share of total system demand—annual volume and peak demand—does CPH represent?
7. Rate impact on CPH under each scenario
Question: Under Scenario 1 and Scenario 2, what is Cal Poly Humboldt’s:
Current annual water and wastewater bill (baseline FY 2025) Projected annual bill in each year FY 2026–FY 2030
Total and percentage increase over the five‑year period Follow‑up: Please provide this in a simple table.
8. Cost responsibility and cross‑subsidy
Question: Please provide a project‑by‑project breakdown of the $36 million water CIP and $51.4 million wastewater CIP: project name, cost, timing, and driver (regulatory/mandated, asset replacement, level‑of‑service improvement, or growth‑related).