Public Notice
CITY OF EAST PALO ALTO
WATER CAPITAL SURCHARGE RATES
NOTICE OF PUBLIC HEARING
6:30 p.m.
March 21, 2023
Hybrid Meeting: City Council Chambers and via Zoom
2415 University Avenue, East Palo Alto
The City of East Palo Alto is currently reviewing water capital surcharge rates. The City charges these rates to water service customers within the City’s service area in order to fund the costs of providing safe and reliable service. At the date, time and place set forth above, the City Council of the City of East Palo Alto will hold a public hearing regarding the proposed rate increases described in this notice.
Purpose of the Notice
You are receiving this notice because you are a customer of the City of East Palo Water System. Customers pay for water services directly to the City’s water contractual water operator, at the rates adopted by the East Palo Alto City Counc il. If approved, the proposed surcharges will be collected monthly, until the City Council determines it is no longer necessary.
Table 1
Proposed Surcharge Rate Schedule
Current Proposed
Total Surcharge
Water Capital
Improvement
Surcharges
Water Usage Charges ($ per ccf)
All Customers $0.43 $0.65
Fixed Monthly Meter Charges
Single Family Residential
5/8’’ - 1’’ $9.12 $9.73
All Other Water Service Meters
5/8’’ $10.70 $15.07
¾” $13.20 $22.61
1’’ $18.10 $37.69
1- ½'’ $12.13 $75.37
2’’ $46.58 $120.60
3’’ $102.96 $226.12
4’’ & Larger $148.78 $376.86
Note: The proposed charges assume the suspension of the water meter charge One ccf = one hundred cubic feet = approximately 748 gallons Basis of the Proposed Rates
In 2022, the City of East Palo Alto adopted the 2022 Water System Master Plan (WSMP). The adopted Master Plan provides the City with an overall plan for potable water infrastructure improvements over the next twenty (20) years to maintain water system reliability and support anticipated development within the City. The 20-year capital improvements project (CIP) plan was based on the developed hydraulic model. As part of the WSMP scope, a rate study and funding analysis were performed to determine how the proposed CIP project may affect rates and how the program will be funded.
The City’s current Water Capital Improvement Surcharges does not generate adequate revenue to fund the capital funding needs identified in the updated Master Plan. To help support the City’s water infrastructure needs, the City’s consultant developed updated Water Capital Improvement Surcharges. The surcharge is used to fund high‐priority capital improvements needed to address current deficiencies, improve water system reliability, and minimize the potential for service outages. Revenues are used to fund costs associated with planning, analysis, design, and construction of water system infrastructure, and cannot be used for any other purpose.
Approximately $6.5 million needs to be recovered over the nextfive (5) years to fund the planned CIP’s identified in the Master Plan. The proposed rate increases are the result of the planned water CIP’s over the next five (5) years. The project list may be found in the Master Plan on the City website: https://www.cityofepa.org/publicworks/project/water-system-master-plan-2022.
The City currently collects around $820k in revenue and this includes the revenue from the water capital surcharge and the water meter replacement surcharge. An increase in the water capital surcharge rate would result in an increase in water capital funds of approximately $471k per fiscal year totaling in a new annual revenue of about $1.29 million a year. The program is designed to collect enough revenue to fund the planned projects. For the basic calculation of the proposed surcharge see Table 4, and for the impact on specific customers, see Table 6 of the Rate Study Report which can be found on the City website :
http://eastpaloalto.iqm2.com/Citizens/FileOpen.aspx?Type=4&ID=14066&MeetingID=1933 Concurrently with the proposed water capital rate change, staff is proposing to suspend the water meter replacement surcharge .
Through the Water Meter Replacement Surcharge the City collected sufficient revenue to fund the program. In the future, any additional program charges will be funded through the City’s water capital surcharge.
Proposition 218 and the Rate Protest Process
Water Capital Surcharge rates are subject to the procedural and substantive requirements as set forth in Proposition 218.
Proposition 218 was adopted by California voters in 1996 and added Articles XIIIC and XIIID to the California Constitution. A rticle XIIID governs property-related charges which have been determined to include ongoing utility service charges such as water, sewer, and garbage rates. The procedural requirements of Proposition 218 include:
1. Noticing Requirement: The City must mail a notice of proposed rate increases to all affected customers of record. The notice must specify the basis of the fee, the reason for the fee, and the date/time/location of a public rate hearing at which the proposed rates will be considered/adopted.
2. Public Hearing: The City must hold a public hearing prior to adopting the proposed rate increases. The public hearing must be held not less than 45 days after the required notices are mailed.
3. Rate Increases Subject to Majority Protest: At the public hearing, the proposed rate increases are subject to majority protest.
If more than 50% of affected customers submit written protests against the proposed rate increases, the adjustments cannot be adopted.
You are invited to provide oral or written testimony at the public hearing. You also have the right to file a formal written protest against the proposed increases. A formal protest must be in writing, must be signed by the customer or property owner, must indicate the address, account number or assessor’s parcel number for which it is submitted, and must indicate that it is a water capital surcharge rate protest. If the City Council receives protests with respect to a majority of the parcels served by the City Water System, or receives protests from a majority of customers, then it will not approve the increase. Protests may be mailed or delivered to the City Clerk at City of East Palo Alto, 2415 University Avenue, 2nd Floor, East Palo Alto, CA 94303, or may be presented at the hearing. Protests must be received by the close of public comment at the hearing in order to be counted. The City will follow its Procedures for the Acceptance and Tabulation of Written Protests in handling and counting protests. Procedures available at City Hall, 2415 University Avenue, 2nd Floor, East Palo Alto, from the City Clerk’s Office or via email:
[email protected].
Questions regarding this item may be sent to [email protected].
Note: Customers with multiple accounts per address may receive multiple letters in the mail. Customers may also receive multiple letters in the mail because a letter was sent out to each account holders mailing address and service address.
Customers with multiple accounts may file one formal protest per account, but each protest must include a different account number (i.e. multiple protests may come from a single address if the address has multiple accounts linked to that address, but the customer must include the account numbers).