RESOLUTION NO. _______
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO
REQUESTING THAT THE LOCAL AGENCY FORMATION COMMISSION TAKE
PROCEEDINGS TO ESTABLISH THE EAST PALO ALTO SANITARY DISTRICT AS
A SUBSIDIARY DISTRICT OF THE CITY OF EAST PALO ALTO PURSUANT TO
THE CORTESE- KNOX-HERTZBERG LOCAL GOVERNMENT REORGANIZATION ACT OF 2000
WHEREAS, the City Council of the City of East Palo Alto has determined it is in the public interest to establish the East Palo Alto Sanitary District as a subsidiary district of the City of East Palo Alto, under the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000; and
WHEREAS, an application initiating the proposed subsidiary district is attached hereto as Exhibit A; and
WHEREAS, a description of the subsidiary district’s boundaries is shown on the map attached as Exhibit B; and
WHEREAS, the proposal is consistent with findings and determinations in the LAFCo Municipal Service Review for the City of East Palo Alto, East Palo Alto Sanitary District and West Bay Sanitary District approved by San Mateo LAFCo on June 15, 2022; and WHEREAS, the proposal is consistent with the sphere of influence alternatives identified by San Mateo LAFCo, and
WHEREAS, the reason for the proposal is to transfer governance and operation of sanitary sewer service to the City of East Palo Alto in the form of a subsidiary district to provide for more efficient operation and coordinated planning of sewer service, infrastructure and capacity to accommodate planned growth and to improve transparency, accountability and environmental health to meet the current and future needs of all District ratepayers.
WHEREAS, the City Council certifies this proposal is exempt from the provisions of the California Environmental Quality Act (CEQA) under Section 15320 of State CEQA Guidelines.
WHEREAS, it is desired to provide that proposed establishment of a subsidiary district be subject to the following terms and conditions:
1) The effective date of the subsidiary district be the first day of a fiscal period (calendar month, quarter, year)
2) LAFCo approval be conditioned upon an executed agreement for operation and maintenance of the sewer system with a private or public agency.
NOW, THEREFORE, BE IT RESOVLED THAT THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO HEREBY approves the application and adopts this resolution, and the Local Agency Formation Commission of San Mateo County is hereby requested to take proceedings for the establishment of the East Palo Alto Sanitary District as a subsidiary district of the City of East Palo Alto pursuant to the provisions of the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000.
BE IT FUTHER RESOLVED that the City Council authorizes the City Manager to make any necessary amendments to the application and plan for service in the course of the LAFCo process.
BE IT FUTHER RESOLVED that the City Council authorizes the expenditure of up to $15,000 dollars for any processing costs.
PASSED AND ADOPTED this 4h day of October 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Ruben Abrica, Mayor
ATTEST: APPROVED AS TO FORM:
James Colin, City Clerk Valerie J. Armento, Interim City Attorney
EXHIBIT A
APPLICATION FOR A CHANGE OF ORGANIZATION, REORGANIZATION, OR
OUTSIDE SERVICE AGREEMENT
TO THE SAN MATEO LOCAL AGENCY FORMATION COMMISSION
A. GENERAL INFORMATION
1. Briefly describe the nature of the proposed change of organization, reorganization, or outside service agreement.
Establish East Palo Alto Sanitary District as a subsidiary district of the City of East Palo Alto
2. An application for a change of organization or reorganization may be submitted by individuals in the form of a petition or by an affected public agency in the form of a certified resolution. This application is submitted by (check one):
_ Landowners or registered voters, by petition
x An affected public agency, by resolution
(If this application is submitted by petition of landowners or registered voters in the affected territory, complete the petition form.)
3. What are the reasons for the proposal?
The reason for the proposal is to transfer governance and operation of sanitary sewer service to the City of East Palo Alto in the form of a subsidiary district to provide for more efficient operation and coordinated planning of sewer service, infrastructure and capacity to accommodate planned growth and to improve transparency, accountability and environmental health to meet the current and future needs of all District ratepayers.
4. Does this application have 100% consent of landowners in the affected area? _ Yes x No
5. Estimated acreage: 1.84 square miles
B. SERVICES
1. List the name or names of all existing cities and special districts whose service area or service responsibility would be altered by the proposed change of organization or reorganization.
Establishing the EPASD as a subsidiary district of the City of East Palo Alto would not alter service area because EPASD would continue to exist as a subsidiary district of the City with the City Council as governing body.
2. List all changes to the pattern of delivery of local services to the affected area. For each service affected by the proposed change(s) of organization, list the present source of service (state “none” if service is not now provided), the proposed source of service and the source of funding for construction of necessary facilities (if any) and operation. Example is given on the first two lines of the space provided for your response.
SERVICE
PRESENT
SOURCE
PROPOSED
SOURCE
FUNDING SOURCE
CONSTRUCTION OPERATING
Sanitary Sewer East Palo Alto
Sanitary
District, an
Independent
Special
District
East Palo Alto
Sanitary District,
a subsidiary
district of the
City of East Palo
Alto
Development Fees,
Grants and Reserve
Sewer Service
Fees and Property
Tax Revenue
C. PROJECT PROPOSAL INFORMATION
1. Please describe the general location of the territory which is the subject of this proposal. Refer to major highways, roads and topographical features.
The boundaries of the East Palo Alto Sanitary District which include the City of East Palo Alto and a portion of the City of Menlo Park bounded by the East Palo Alto/Menlo Park Boundary, San Francisquito Creek and Menalto Avenue. (Please see attached map)
2. Describe the present land use(s) in the subject territory.
The City of East Palo Alto, which is 2.6 square miles, is a mostly built out city, with the exception of open space, marshlands and vacant land in the Ravenswood Industrial area. Of the developed areas, residential uses are the most common land use in the City. Approximately 50% of the land are residential uses, with the majority being single family, along with a smaller percentage of multi-family uses. Commercial and office account for approximately six percent of the land area. The greatest mix of uses occurs where residential neighborhoods are near University Avenue’s retail uses, or near the Ravenswood 101 Shopping Center. There is also a relatively significant amount of vacant land, primarily concentrated along Bay Road within the 350-acre Ravenswood Business District/4 Corners Transit Oriented Development Specific Plan (RBD), where previously industrial businesses were located. Institutional uses, public facilities, and parks and recreational facilities account for approximately ten percent of the land areas in the City.
3. How are adjacent lands used?
North: Baylands, Open Space
South: Residential (the cities of Palo Alto and Menlo Park) East: Baylands, Open Space (including the City of Palo Alto) West: Residential and Office Park (including the city of Menlo Park and Facebook)
4. Will the proposed change of organization result in additional development? If so, how is the subject territory to be developed?
The intent of establishing EPASD as a subsidiary district of the City is to allow development consistent with the City’s General Plan, Zoning Ordinance and Ravenswood Specific Plan. The City has not been able to issue building permits without confirmation of capacity from the EPASD. Additionally, the City is also processing an update to the RBD Update to potentially allow between two to three million square feet of commercial use as well as up to 1600 residential units within the Specific Plan area. The update is scheduled to be heard by the City Council in mid2023.
5. What is the general plan designation of the subject territory? The entire city has the following General Plan designations, encompassing residential, mixed use, commercial, parks, industrial, public/institutional and open space categories: Low Density Residential (0-12 units/acre), Medium Density Residential (12.1-22 units/acre), High Density Residential (22.1-43 units/acre), Urban Residential (43.1-86 units/acre), Mixed Use Low, Mixed Use Corridor, Mixed Use High, Neighborhood Commercial, General Commercial, Office, General Industrial, Industrial Buffer, Parks/Recreation/Conservation, Resource Management and Public/Institutional.
The specific definitions of the General Plan designations can be found in the land use chapter of the City’s General Plan Vista 2035:
https://www.cityofepa.org/sites/default/files/fileattachments/community_amp_economi c_development/page/2731/epa_gp_chapter_4_land_use_and_urban_design_final_2018 07271721214683.pdf
6. What is the existing zoning designation of the subject territory? The entire city has the following Zoning designations: Residential Low Density (RLD), Residential Medium Density (R-MD), Residential High Density (R-HD), Residential Urban High Density (R-UHD), Mixed Use Corridor (MUC), Mixed Use Low (MUL), Mixed Use High (MUH), Commercial General (C-G), Commercial Neighborhood (C-N), Commercial Office (C-O) Public Institutional (PI), Parks and Recreation (PR), and Resource Management (RM). The City also has specific zoning designations within the RBD Specific Plan area. The districts include the following: 4 Corners, Bay Road Central, Ravenswood Employment Center, Industrial Transition, Waterfront Office, Urban Residential, University Village (single family), Ravenswood Open Space, and Ravenswood Flex Overlay.
A definition of all these districts can be found in the City’s development code Chapter 18, Article 2, which is part of the City’s Municipal Code:
https://library.municode.com/ca/east_palo_alto/codes/code_of_ordinances?nodeId=EA PAALDECO2018EDCUORNO09-
2020ADDE152020_TIT18DECO_ART2ZOALUSDEST.
Definitions of the RBD zoning designations can be found in the land use section of the Specific Plan:
https://www.cityofepa.org/sites/default/files/fileattachments/community_amp_economi c_development/page/2811/land_use_section_6.pdf.
7. What prezoning, environmental review or development approvals have already been obtained for development in the subject territory?
The entire City is governed by the General Plan Vista 2035, Development (Zoning) Code, and the RBD Specific Plan. Each of these had environmental clearances, including the program level environmental impact report (EIR) for the General Plan and the RBD Specific Plan. The City is also in the process of preparing an update to the RBD Specific Plan, including its own programmatic EIR. The City anticipates the Specific Plan and EIR to go before the City Council for a decision in mid 2023.
The LAFCo application is exempt from the California Environmental Quality Act (CEQA) under Section 15320 of State CEQA Guidelines because it consists of establishment of a subsidiary district, which does not change the geographical area in which previously existing powers are excercised.
8. What additional approvals will be required to proceed? Execution of a contract for operation of the sewer system with a private or public sewer entity.
9. Does any portion of the subject territory contain any of the following --agricultural preserves, sewer or other service moratorium or wetlands subject to the State Lands Commission jurisdiction?
No.
10. If no specific development projects are associated with this proposal, will the proposal increase the potential for development of the property? If so, how? The proposal will accommodate development already approved by the City of East Palo Alto. This proposal will accommodate approved development by increasing the capacity of the sanitary sewer system and providing much needed service for new land uses, including development proposed by residents. Many recently approved entitlements have not been able to proceed to building permits because will serve letters have not been issued by the EPASD.
* * * * * * * * * * *
LAFCo will consider the person signing this application as the proponent of the proposed action(s). Notice and other communications regarding this application (including fee payment) will be directed to the proponent at:
NAME: ______________________________________
EMAIL: ______________________________________
ADDRESS: ______________________________________
______________________________________
TELEPHONE: ______________________________________
ATTN: _______________________________________
___________________________________________________
Signature of Proponent
Applica_blk.doc
(10/6/2000)
EXHIBIT B
PLAN FOR PROVIDING SERVICE
A. AFFECTED PUBLIC AGENCIES
Please complete this section if this application if submitted by resolution of one or more affected public agencies. Certified copies of resolutions listed below must accompany this application.
1. The names and resolutions of agencies applying for the change of organization or reorganization described above are as follows:
AFFECTED AGENCY
City of East Palo Alto
RESOLUTION NO.
#
DATE ADOPTED
date
2. Does this application have 100 % consent of landowners in the affected area? Yes ____ No x (If Yes, include proof of consent.)
B. PLAN FOR PROVIDING SERVICES
1. Enumerate and describe the services to be extended to the affected territory.
Wastewater collection pursuant to the Sanitary District Act (California Health and Safety Code §6400 – 6982 by operating and maintaining the collection system via a private or public entity and sewage treatment via a contract with the City of Palo Alto for capacity at its Regional Water Quality Control Plant.
2. Describe the level and range of those services
The collection system would continue to be operated in accordance with Statewide SSO Waste Discharge Requirements and RWQCB Sewer System Management Plan guidelines. Operation and maintenance of the sanitary sewer collection system consisting of approximately 30 miles of gravity sewer lines, of which approximately 70 percent are 6 inches in diameter and the balance ranging from 8 to 24 inches in diameter. Operation will include replacement of deficient lines to serve existing customers and capital improvements to accommodate planned development.
The City engaged Freyer & Laureta (F&L) to identify potential capital improvements to improve the overall reliability and resiliency of the existing sanitary sewer collection system; identify potential capacity improvements required to provide service for future development as approved by the City; develop an annual operation and maintenance budget for the sanitary sewer collection system including the expenses associated with wastewater treatment at the Palo Alto Regional Water Quality Control Plant (PARWQCP); develop potential annual sanitary sewer service charge to support ongoing operation of the sanitary sewer collection system and Develop connection fee for new developments to receive sanitary sewer service. (Please see F&L Memo labeled Attachment #)
To develop an estimated annual operating and maintenance budget, F&L reviewed the published Fiscal Year 2022/2023 budget from WBSD. Table 7 presents our methodology for developing a budget for operating expenses for labor and other overhead costs applying a ratio calculated by dividing the total miles of pipes within the EPASD collection system by the total miles of pipe within the WBSD collection system.
In addition to the labor costs for operating the collection system, EPASD contributes the operating and capital costs for the PAWRQP as outlined in the existing agreement. In reviewing the East Palo Alto Sanitary District, 2019 Sewer Rate Study (Rate Study), F&L identified that the study include a summary of anticipated treatment operation, capital, and debt service costs 1. The costs listed in the Rate Study were consistent with information that F&L found from a November 17, 2020 presentation to the City of Palo Alto Finance Committee.
Please see summary of the anticipated costs for PARWQCP treatment and capital improvements in Table 8.
3. Indicate when those services can feasibly be extended to the affected territory.
The City will contract with a private or public entity to operate the system. The Contract will be negotiated to begin on the effective date the district is established as a subsidiary district of the City. The application to LAFCo requests that the effective date be the first day of a fiscal period (month, quarter, year).
4. Indicate any improvements or upgrading of infrastructure or facilities such as, structures, roads, sewer or water facilities, or other conditions to be imposed or required within the affected territory. Describe in detail, the size, location, and capacity of new infrastructure that will be necessary to provide service.
Establishing the District as a subsidiary district of the City in itself, does not require improvements. The purpose of establishing the District as a subsidiary district is to implement improvements for both public health and safety and to accommodate planned growth. The attached tables provide detail on planned improvements to correct system deficiencies for current customers and capital improvements to accommodate planned development. These plans were prepared based on publicly available information. EPASD is in the process of televising the sewer system. The outcome of the completed televising of the system will further inform these plans.
F&L has developed a suggested list of capital improvements that match the improvements identified in the 2015 Master Plan. Although we concur that performing the improvements suggested in the 2021 Master Plan would provide additional contingency capacity when compared to the 2015 Master Plan, the PWWF design condition is the peak design event that will only occur for a short duration as described in the 2015 Master Plan. The improvements identified in the 2015 Master Plan do allow for some portions of the collection and conveyance system to flow under surcharge conditions (e.g., pressure flow) but the predicated HGL is at least fourfeet lower than the sanitary sewer manhole rim elevations.
Table 1 lists the pipe segments and Figure 1 highlights the same pipe segments that are required to be upgraded to reduce the risk of SSOs during PWWF conditions. Table 2 presents the Conceptual Opinion of Probable Project Cost to implement the improvements listed in Table 1 and highlighted on Figure 1 F&L developed a capital improvement plan that includes both the existing system capacity deficiencies and the development related capacity deficiencies as shown on Figure 3. Figure 4 includes a suggested timeline to address the existing system capacity deficiencies as shown on Figure 4. The suggested timeline is intended to allow the existing system capacity deficiencies to be built over 15 years, which will allow for grant and low interest loan funding sources to be secured to fund the necessary improvements. The actual timeline to implement the capacity assurance improvements may need to be adjusted based on proposed development approval, permitting, and construction process.
Because the development related deficiencies will be implemented based on actual development approvals and construction, F&L has not identified a specific timeline to implement the development related deficiency improvements. Figure 5 does present the anticipated developments over the next five years listed in Table 5 with the development related deficiency improvement to allow the City to begin understanding where improvements may be required prior to issuing final Certificates of Occupancies for any of the identified developments. The ultimate timeline to construct the capital improvements required to address development related deficiencies will be determined once the proposed development has paid its connection fees and provided a firm timeline for occupancy.
5. Describe financial arrangements for construction and operation of services extended to the affected territory (Attach proposed operations budget if available).
Will the territory be subject to any special taxes, charges or fees? (If so, please specify.)
Establishing EPASD as a subsidiary district does not constitute an extension of service, rather a transfer of governance and service responsibility to the City of East Palo Alto. The following details financial arrangements for operation and construction.
Proposed Operating and Maintenance Plan
The City would contract with a public or private entity to operate the collection system.
The collection system would continue to be operated in accordance with Statewide SSO Waste Discharge Requirements and RWQCB Sewer System Management Plan guidelines. To develop an estimated annual operating and maintenance budget, F&L reviewed the published Fiscal Year 2022/2023 budget from WBSD. Table 7 presents our methodology for developing a budget for operating expenses for labor and other overhead costs applying a ratio calculated by dividing the total miles of pipes within the EPASD collection system by the total miles of pipe within the WBSD collection system.
In addition to the labor costs for operating the collection system, EPASD contributes the operating and capital costs for the PARWQCP as outlined in the existing agreement. In reviewing the East Palo Alto Sanitary District, 2019 Sewer Rate Study (Rate Study), F&L identified that the study includes a summary of anticipated treatment operation, capital, and debt service costs2. The costs listed in the Rate Study were consistent with information that
F&L found from a November 17, 2020, presentation to the City of Palo Alto Finance Committee.
We have summarized the anticipated costs for PARWQCP treatment and capital improvements in Table 8.
Annual Sewer Charge
F&L reviewed existing information from the EPASD web site and identified that the current Annual Sewer Charge (ASC) is $600 per EDU3. The current ASC is consistent with the suggested ASC from the Rate Study for Fiscal Year 2019/20 but EPASD has not implemented the recommend 5-percent annual increase that was included in the Rate Study4.
F&L calculated a potential ASC based on the current estimated operating and capital costs that would be required to fund all expenses for one fiscal year with only partial contribution from the EPASD reserves. Table 9 provides a potential ASC that is more than the current EPASD published ASC but we do not recommend that the larger ASC be implemented in the near term. We have presented the calculated ASC to confirm that what the EPASD Rate Study that indicates it is a necessary annual rate increase to account for the projected annual increase in operating costs that will continue to be experienced in future years. Without implementing a regular annual ASC increase, there will be a shortfall between revenues and expenses that will need to be funded from current reserves.
For purposes of developing the Plan, we suggest that the ASC be established at $600 per EDU for Fiscal Year 2022/23 and then be increased by 5-percent per year in accordance with the recommendations of the EPASD’s Rate Study. However, F&L does anticipate that at some point in the future the ASC will be required to be raised to a level similar to what is presented in Table 9 to ensure that there is adequate revenue to provide safe and reliable sanitary sewer service to all current and future customers while not diverting funds from reserves that can otherwise fund critical capital improvement projects.
Connection Fee
EPASD’s published connection fee5is $6,060 although F&L could not find a study that outlined the methodology used to determine the connection fee. F&L did develop a potential connection fee that considers:
• 50-percent of capacity assurance improvements identified in Table 2 will be a benefit to new development because by implementing the recommend projects provides a more reliable and resilient system for existing customers but also creates additional capacity for the benefit of new development.
• 100-percent of development related capacity deficiencies identified in Table 4. • Buy-in cost of $5 million per 1.0 MGD of treatment capacity to reflect developers payback of existing PAWRQCP capacity that is available for new development. • Application review fee.
Table 10 presents the calculation methodology to develop a potential Connection Fee, which is $6,100. Because the potential Connection Fee presented in Table 10 is similar to the current publish EPASD connection fee, we suggest that the connection fee be kept at $6,060 for the first year and then increased by 5-percent per year similar to the ASC.
However, a regular review of the connection fee should be completed to ensure that connection fee reflects actual costs incurred to accommodate City approved development.
Annual Budget Cash Flow
As a final step in developing the Plan, F&L evaluated the year over year cash flow for operations and improvements of the sanitary sewer collection system. Table 11 presents F&L’s cash flow project for five fiscal years beginning with Fiscal Year 2022/23. The cash flow analysis includes the following key items:
• The ASC is initial set at $600 per EDU similar to the current EPASD ASC but a 5- percent annual escalation is applied in accordance with EPASD’s Rate Study recommendation.
• The connection fee is set at $6,060 per EDU similar to the current EPASD connection fee and an annual 5-percent escalation is applied similar to the ASC. • The total number of anticipated new EDUs for each fiscal year is provided based on the information presented in Table 6.
• The total number of connected EDUs is also provided including accounting for new EDUs that are projected to be added during each fiscal year. • The beginning reserve fund balance is assumed to be $17.38 million. The most recent publicly available audit for EPASD is dated June 30, 2020 and indicates a net position of $25.03 million. In addition, the EPASD FY 22/23 includes a $15 million transfer from reserves to the Construction Replacement Fund and indicates a reserve fund balance of $17.38 million.
• Revenues include the ASC, connection fees, property taxes presented in the EPASD Rate Study, ERAF Rebate/Former RDAF presented in the EPASD Rate Study, and interest earned on reserve funds.
• Expenses including labor and other operating expenses for the collection system, Sewer Rehab Improvements to fund annual point repair projects, Capacity Assurance Improvements to fund the improvements identified in Table 2, PAWRQCP annual treatment costs, EPASD share of existing PARWQCP debt service, EPASD share of project PARWQCP debt service, and EPASD 2011 SRF Loan debt service presented in the EPASD Rate Study.
For each fiscal year, the project expenses are projected revenues are calculated and presented. If expenses in a given fiscal year are greater than the project revenues, the Reserve Funds are used to balance the expenses and revenues.
By utilizing portions of the existing Reserve Funds each fiscal year, the existing customers’ contributions to the reserves over the years is utilized to fund the existing customers’ 50-percent share of the Capacity Assurance Improvements identified in Table
2. The primary purpose of holding collected ASC and connection fees over several years is to allow for an agency to develop sufficient available funds to implement capital improvement projects. Therefore, beginning to draw from reserves to fund the existing customers’ portion of the recommended annual capital improvement program and capacity assurance capital improvement program that is for the benefit of the existing customers.
At the end of the five-year evaluation period, the projected Reserve Fund balance is equal to the annual operating and debt service costs. Because EPASD receives its revenue payments twice per year as part of the property tax collection, sufficient reserves to fund at least six months of operation is suggested. The cash flow evaluation presented in Table 11 maintains a minimum of 12-months of Reserve Funds for each given fiscal year.
The cash flow review above will be impacted by the actual beginning balance of EPASD Reserve Funds. If additional information on the actual Reserve Fund balance becomes available, the cash flow analysis will be updated.
6. In as much detail as required to give a clear explanation, explain why this proposal is necessary at this time.
Since incorporation in 1983, the City has struggled to achieve economic growth and financial sustainability, especially in comparison to other nearby communities. To address this, the City’s leadership has organized around actions that strengthen the City’s economic profile, with the ultimate goal of improving the lives and enhancing the well-being of East Palo Alto residents. To that end, the City became successor to the Ravenswood Lighting and Drainage Maintenance Districts in 2005 and the East Palo Alto County Waterworks District in 2001. Most recently the City successfully negotiated a water rights transfer agreement with the City of Mountain View to provide adequate water supply to support the City’s future development objectives. Establishing the EPASD as a subsidiary district of the City, an alternative supported by the LAFCo MSR and State policies favoring multi-purpose government over single purpose government in urban areas, would further these efforts and make the City whole as a land use agency and utility provider.
The Draft MSR provides an accurate account of the inability of the East Palo Alto Sanitary District to meet the needs of existing District ratepayers by failing to implement a Capital Improvement Plan (CIP) to replace and upsize pipe aging pipe sections to eliminate surcharges and sanitary sewer overflows (SSOs) that pose a health and safety risk to current rate payers and residents. Additionally, current residents are unable to obtain “will service letters” for accessory dwelling units permitted by State law and the City’s General Plan.
New development that is obstructed due to failure to implement a Capital Improvement Plan (CIP) includes a variety of projects that are critical to meet the City’s affordable housing and economic development goals, employment opportunities, and provide for essential services including a health clinic and job training center.
The City is well positioned to contract with a private or public sanitary sewer entity for operation and maintenance of the sewer system that serves the majority of the City. The City also has a successful record in obtaining grant funding that will be of benefit to sewer rate payers.