Agenda packet — Hanford City Council, November 7, 2023 (part 1 of 2)

City Council Meeting
Agenda
November 7, 2023
7:00 PM – Regular Meeting
Council Chambers
400 N. Douty St.

Council Members will meet in-person in the Council
Chambers. The meeting will also be lived streamed on the City’s website: http://livestream.hanford.city/

4:00 PM CALL TO ORDER STUDY SESSION AND CLOSED SESSION:

ROLL CALL BY THE CITY CLERK:

PUBLIC COMMENT:

Study Sessions are considered Special Meetings under the Brown Act. Accordingly, comments from the public are limited to items listed on the agenda (GC 54954.3a). Public Comment will be accepted during each agenda item. A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.

STUDY SESSION:

A. Presentation by the Carnegie Museum of Kings County regarding their 2023 Exhibits and Collections and ongoing efforts to restore the Historic Carnegie Library building.

B. Presentation to Council and review of measures that the City of Hanford can take to improve the City’s financial position and direction to staff as appropriate.

CLOSED SESSION FOR DISCUSSION OF THE FOLLOWING:

A. CONFERENCE WITH LEGAL COUNSEL-PROPERTY NEGOTIATIONS (GC 54956.8) Property: 330 N. Harris Street
Agency Negotiators: Mario Cifuentez and Ty Mizote
Negotiating Party: Great Valley Holdings, LLC
B. PUBLIC EMPLOYEE PERFORMANCE EVALUATION (GC 54957)
TITLE: City Manager
CALL TO ORDER REGULAR SESSION:

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ROLL CALL:

INVOCATION:

Shannon Brown
FLAG SALUTE:

RECOGNITION:

A. Recognition of Officer Mark Carillo for creating trauma bags for all the local schools and training the school's staff on proper use of the bags.

COUNCIL REPORTS/GENERAL REPORTS:

Brief information-only reports from City Council and/or Staff, including committee reports and reports by City Council related to meetings attended at City expenses (AB1234).

PUBLIC COMMENT:

This is the time for citizens to comment on subject matters within the jurisdiction of the Hanford City Council. This is also the public’s opportunity to request an item from the Consent Calendar be pulled for discussion purposes or to comment on any item on the agenda. State law does not allow the Council to discuss or take action on issues not on the agenda, except that members of the Council or staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights (Gov. Code sec. 54954.2). A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.

CONSENT CALENDAR:

Consent Calendar items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made and then the item will be removed from the Consent Calendar to be discussed and voted upon by a separate motion.

A. Procedural Waiver: Waive reading in full of resolutions and ordinances and approval and adoption of same by reading title the only.

B. City Clerk: Approval of the Minutes of the October 3, 2023 Meeting C. City Clerk: Appointment of Judy Scott to the Parks and Recreation Commission's unscheduled vacancy with a term ending on 12/31/2024.

D. City Clerk: Adoption of Resolution 23-45-R, amending the city's email correspondence retention period from three (3) years to two (2) years.

E. Administration: Adoption of Resolution 23-46-R, amending the Handbook of Rules and Procedures to include various amendments as recommended by Council.

F. Administration: Approval of Amendment No. 3 of the License Agreement between the Carnegie Museum of Kings County and the City of Hanford to extend the term of the agreement until December 31, 2024.

G. Public Works: Approval of the Notice of Completion of the FY 23 Double Fiberized Micro Surface Treatment Project, for a total contract price of $484,753.00, by Pavement Coatings Company, and authorization for the Mayor to execute and the City Clerk to attest and file said Notice with Kings County Recorder’s Office.

H. Police: Approval of a contract with Janitorial Inc. at the rate of $42,036 for the remainder of 2023 and $43,176 for 2024 to provide janitorial services at the Police Department buildings.

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I. Police: Authorization to accept the Homeland Security Grant from the County of Kings in the amount of $55,448, and an amendment to the Police Department's operating budget to recognize the grant, appropriation of $55,448 in the General Fund for the Police Department, and authorization for the City Manager to execute the grant agreement.

GENERAL BUSINESS:

A. Presentation from Lechowicz & Tseng Municipal Consultants on the Rate Study for water, wastewater and storm drain rates and Council direction to staff and consultants to commence with the Proposition 218 process and set the Hearing Date & Time for January 16, 2024 at 7pm for the proposed rate increases.

COUNCIL REQUESTS/REPORTS:

At this time, any Council Member may ask a question for clarification, make an announcement, or report briefly on their activities. In addition, subject to Council Policies and Procedures, they may request staff to report back to the Council at a subsequent meeting concerning any matter or take action to direct staff to place a matter of business on a future agenda. (GOV. CODE SEC. 54954.2)
A. Council Future Agenda Items
B. Upcoming Events and Important Dates:

November 8: Community Meeting with the Mayor and Vice Mayor, in the City Hall Training Room 6:00 p.m. - 7:30 p.m. More info
November 10: Holiday, city offices will be closed
November 21: Regular City Council Meeting
November 23 & 24: Holiday, city offices will be closed
ADJOURNMENT:

Materials related to an item on this Agenda submitted to the City Council after distribution of the agenda packet are available to public inspection in the City Clerk’s Office located at 319 N. Douty Street, Hanford, California 93230, during normal business hours. Such agendas are also available at the city’s website, www.cityofhanfordca.com subject to staff’s ability to post the agenda before the meeting.

If you need a disability-related modification or accommodation, including auxiliary aids or services, to participate in this meeting, please contact the City Clerk’s office, 559-585-2515, 319 N. Douty Street, Hanford, California 93230, at least 2 days prior to the meeting {28 CFR 35.102.35.104 ADA Title II}

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4.A.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: STUDY SESSION

SUBJECT:

Presentation by the Carnegie Museum of Kings County regarding their 2023 Exhibits and Collections and ongoing efforts to restore the Historic Carnegie Library building.

RECOMMENDATION:

BACKGROUND:

FISCAL IMPACT:

ATTACHMENTS:

None

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4.B.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: STUDY SESSION

SUBJECT:

Presentation to Council and review of measures that the City of Hanford can take to improve the City’s financial position and direction to staff as appropriate.

RECOMMENDATION:

Recommendation: That the City Council receive the presentation, discuss potential revenue measures for the City of Hanford and provide general direction to staff.

BACKGROUND:

The City Council has expressed concern for the fiscal health of the General Fund in the past and has directed staff to find ways for improvement. As was shown during the adoption of the 2023/2024 & 2024/2025 biennial budget, there are many and substantial demands of the General Fund that are not able to be financially supported. The City Council was able to adopt a balanced budget.

However, this relied on one-time increased revenue and cost-saving items along with many needs, such as facility improvements and maintenance, and vehicle reserves being deferred. These needs were deferred to assist in improving the financial condition and recovering the General Fund Reserve, but must begin being addressed soon otherwise they will create heavy financial stress for the City in the future.

Enterprise funds such as Water, Sewer, Storm Drain and Refuse are supported by rates paid by the utility users. These funds are not a part of this discussion as there is a separate study being done specific to those rates.

The City's General Fund

The General Fund is the City's most discretionary funding source that receives revenues from Sales Tax, Property Taxes, Business Tax, Transient Occupancy Tax among other revenues including fees for recovery of costs. There are several areas of essential services that are paid for out of the General Fund including Police, Fire, Streets, Administration, Parks/Recreation and Planning/Community Development. The City's budget for fiscal year 2023/2024 is just under $43.6 million for the General Fund, Table 1 shows the appropriation across areas of operation/use.

Table 1: City of Hanford 2023/2024 General Fund appropriation

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For the most recent budget adoption, the City had a significant challenge having a balanced budget as required by Council-adopted resolution. In addition, economic forecasts indicate a slow down in revenue, so cost increases due to inflation and salary increases are projected to be hard pressed to be fully offset. For the past several years, the City has been 'tightening its belt' financially. However, there are limits as to what can be done as personnel costs are the majority of costs (over 70% of General Fund expenditures) and there are essential costs of operating that must be covered. All non- fixed costs are continually scrutinized by staff.

In addition, proving to be a significant challenge to balancing the City's General Fund was the $12.5 million settlement agreed to in early 2023 of which $7.5 million has been paid. This depleted the GF reserve to approximately 6%, well below the 35% goal (15% operating, 20% fiscal emergency). The remaining $5 million must be paid over the next four years at $1.25 million annually. This will have a direct impact on the General Fund budget over the next four years as the City must set aside funding for this debt payment in addition to all other operating, capital and existing debt demands. Items like this are temporary. However, with increasing costs for current operations and emergency capital needs, there is little to no room in the budget for increasing services/operations, improving services or proactively meeting capital needs.

Types of Measures to Consider

There are several options that City Council may consider of the potential revenue measures that would increase discretionary revenue for the City's General Fund. These will be discussed in more detail during the presentation. Table 2 provides a summary of revenue measure options and requirements for passage, Table 3 depicts the position of the City of Hanford and nearby cities and what measures are in place.:

Table 2: Summary of potential revenue measures with requirements for passage

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Table 3: Revenue rates of City of Hanford and surrounding cities

A major detail selection involves the type of measure sought. The two main alternatives generally obtained by cities are a general or special revenue measure. Special measures can be sales, property, utility users or parcel taxes or a general obligation bond and general measures are typically sales tax measures.

What if the City was to have additional revenue?

A revenue measure would increase discretionary tax revenue (in the General Fund) available for City Council’s use in funding City services. The City’s current discretionary revenues in the General Fund include sales tax, property tax, utility user’s tax, franchise tax, transient occupancy tax, licenses, permits, etc. Areas currently funded directly by the General Fund Revenues are General Government, Parks and Community Services, Public Safety (Police and Fire) and Streets (primarily Maintenance of Effort funding as required by the State). These funds do not pay for Enterprise Fund costs such as Water, Sewer and Refuse, which are only funded by their associated rates.

Through the public process of a budget adoption, on an ongoing basis, City Council would determine how the City spends these additional revenues and adhere to a plan developed during a ballot initiative. The amount of funding potentially available would vary greatly depending on what the Council may consider for voters to decide on.

Typically, an initial proposal is developed that will begin discussions and evaluation, quite often with adjustments being made through a vetting process by Council, the community and staff.

FISCAL IMPACT:

Should Council direct staff to look into additional revenue measures, there would be minor impact beyond regularly budgeted items in the early stage of the development. Through the development process, some activities will have associated costs such as legal, surveying and information distribution. Placing an item on the ballot will also have associated costs. If a revenue measure is ultimately passed, additional revenue would occur with the amount dependent on the revenue details in the passed measure.

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ATTACHMENTS:

None

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13.B.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Approval of the Minutes of the October 3, 2023 Meeting

RECOMMENDATION:

Recommended: Aprrove the minutes from the October 3, 2023 meeting.

BACKGROUND:

FISCAL IMPACT:

ATTACHMENTS:

1. 10.3.2023 Minutes

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City Council Regular Meeting
Minutes
October 3, 2023 7:00 PM
Council Chambers
400 N. Douty St.

5:00 PM CALL TO ORDER STUDY SESSION:

Mayor Paden called the study session to order at 5:00 p.m.

ROLL CALL BY THE CITY CLERK:

Present: Absent:

Council Member Lou Martinez
Council Member Mark Kairis
Council Member Kalish Morrow
Council Member Diane Sharp
Council Member Travis Paden

PUBLIC COMMENT:

None.

STUDY SESSION:

A. Council review and direction to staff on the proposed goals and policies for Community Facilities Districts for all future subdivisions and authorization for Staff to engage a consultant to establish a program to finance improvements via Community Facilities Districts.

Deputy City Manager Jason Waters discussed the proposed goals and policies for Community Facilities Districts for all future subdivisions. Deputy Waters and City Attorney Mizote answered questions from the Council. After some discussion, it was the consensus of the Council to authorize staff to engage a consultant to evaluate the feasibility of improvement financing, and if feasible, create a program to finance improvements via Community Facilities Districts.

The Mayor adjourned the study session at 5:27 p.m.

CALL TO ORDER REGULAR SESSION:

Mayor Paden called the meeting to order at 7:00 p.m.

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ROLL CALL:

Present: Absent:

Council Member Lou Martinez
Council Member Mark Kairis
Council Member Kalish Morrow
Council Member Diane Sharp
Council Member Travis Paden

INVOCATION:

The invocation was led by Pastor Mark Curts.

FLAG SALUTE:

The flag salute was led by Destiny Cruz, Hanford High School Senior Class President.

COUNCIL REPORTS/GENERAL REPORTS:

Brief information-only reports from City Council and/or Staff, including committee reports and reports by City Council related to meetings attended at City expenses (AB1234).

The Council discussed the meetings and events they attended. During this time, Vice Mayor Kairis requested the General Business section items be reviewed before the public hearing, with no objections from the Council.

PUBLIC COMMENT:

Gordon Teston spoke in opposition to the annexation.

Amy Minor, Player Agent and Registrar for the Hanford Youth Baseball League, commented on the Hanford Field Use Policy and the proposed fees, and spoke in opposition.

Anna Brookshire questioned grant the city received for the "Hanford goes Green Project".

Brian Minor, President of Hanford Youth Baseball League, commented on the partnership the league has with the city and expressed his concerns regarding the proposed field fees.

Lisa Chavarin, President of the Hanford Youth Softball League, expressed concerns regarding the usage of the fields and the proposed field fees.

Bob Ramos questioned the cannabis revenue. He also commented on the Lacey Park water fountain, the broken zipline and the Civic Park restrooms.

Chris Hill thanked the Council for their time, and he read an article from 1976 about the Bob Hill Sports Complex. He also suggested there be more discussion regarding the proposed fees.

Sharon expressed her concerns about the homeless, and asked what the city is doing about it.

Jamie Barela commented on the annexation and expressed her concerns about the police department's response time. She also commented on the People's Bridge project.

Susan Davis commented on the street sweeping schedule.

Judy Mellow expressed her concerns about the water supply for new developments in the city. Deputy Waters responded to her comment.

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Jay Rubalcava commented on the annexation of his property.

CONSENT CALENDAR:

Item C was pulled by Council Member Martinez, and Items D and E were pulled by Council Member Sharp.

Motion to approve the consent calendar except for the items pulled for separate consideration.

RESULT:

MOVER:

SECONDER:

AYES:

PASSED (UNANIMOUS)
Council Member Diane Sharp
Council Member Mark Kairis
Lou Martinez, Mark Kairis. Kalish Morrow, Diane Sharp,Travis Paden A. Procedural Waiver: Waive reading in full of resolutions and ordinances and approval and adoption of same by reading title the only.

B. City Clerk: Approval of the Minutes of the September 19, 2023 Meeting PULLED CONSENT ITEMS:

A. Administration: Approval of an In-Kind contract with the Hanford Chamber of Commerce, consistent with the recommendation of the Council Ad-Hoc subcommittee, that memorializes the services to be offered in exchange for office space in the Courthouse. [Item C]

Pulled by Council Member Martinez.

Council Member's Morrow and Kairis addressed Council Member Martinez's concerns.

Motion to Approve
RESULT:

MOVER:

SECONDER:

AYES:

PASSED (UNANIMOUS)
Council Member Kalish Morrow
Council Member Diane Sharp
Travis Paden, Lou Martinez, Mark Kairis, Diane Sharp, Kalish Morrow B. Administration: Approval of a Facility Lease Agreement with MSI, Inc. for the City property located at 426 W. Lacey Blvd, more commonly referred to as the Former Goodwill building, for an initial rent of $3,600 per month increasing by 5% annually. [Item D]

Pulled by Council Member Sharp to recuse herself from the discussion and vote.

City Attorney Ty Mizote clarified an error in the staff report. The attached lease agreement is accurate.

Motion to Approve
RESULT:

MOVER:

SECONDER:

AYES:

ABSTAIN:

PASSED
Council Member Kalish Morrow
Council Member Mark Kairis
Travis Paden. Mark Kairis, Kalish Morrow, Lou Martinez
Diane Sharp
C. Community Development: Authorization for the City Manager to execute documents and

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enter into a contract with Caltrans for the Kings-Tulare High-Speed Rail Station Transit- Oriented Development and Connectivity Plan and Cross Valley Corridor Rail Service Planning project to be funded through a $650,000 Sustainable Communities grant. [Item E]

Pulled by Council Member Sharp.

This item was pulled by Council Member Sharp to recuse herself from the discussion and vote. Deputy City Manager Water answered questions from the Council.

Motion to Approve
RESULT:

MOVER:

SECONDER:

AYES:

ABSTAIN:

PASSED
Council Member Mark Kairis
Council Member Kalish Morrow
Travis Paden, Mark Kairis. Kalish Morrow, Lou Martinez
Diane Sharp

GENERAL BUSINESS:

A. Community Development: Approval of a Memorandum of Understanding (MOU) between the City of Hanford and Kings County, pertaining to the annexation of the remaining "substantially surrounded islands" within the City of Hanford.

Senior Planner Gabrielle Myers presented the project for the Council's review and approval. Staff answered questions from the Council. City Attorney Mizote clarified the designations. Staff clarified that this is not a request to approve an annexation. Staff recommended approving the MOU as amended. Mayor Paden suggested tabling the item and excluding Island 10 from the agreement. Council Members Sharp and Morrow spoke in support of staff's recommendations. Deputy City Manager Waters and City Attorney Mizote provided clarification of LAFCO's legal authority to annex the remaining islands in the City of Hanford. After much discussion, Vice Mayor Kairis made the motion to approve the item as presented.

Motion to Approve
RESULT:

MOVER:

SECONDER:

AYES:

NAYS:

Passed
Council Member Mark Kairis
Council Member Diane Sharp
Diane Sharp, Mark Kairis, Kalish Morrow
Travis Paden, Lou Martinez
B. Parks and Community Services: Presentation regarding the Council-supported formation of the Field Sports Advisory Committee and Approval of the Field Permitting Process and Adoption of the City of Hanford Athletic Field Use Policy and associated permit fees.

During the presentation, Council Member Morrow motioned to extend the meeting to 10:20 p.m. Seconded by Council Member Martinez. Motion passed 5-0.

Parks and Community Services Director Brad Albert presented the Council-supported formation of the Field Sports Advisory Committee and the Field Permitting Process for the Council's review and approval. Dir. Albert also provided an overview of the operating expenses for the YAC, Soc Com & Softball complex fields and shared a fee analysis of 12 local cities. Vice Mayor Kairis questioned the fee schedule and the cost for maintenance. Dir. Albert answered questions from the Council. Mayor Paden and Vice Mayor Kairis expressed their concerns regarding the fee structure and the input from the entire advisory committee. Mayor Paden stated that he was not in favor of making a decision tonight. Council Member Sharp spoke in support of the item and made the motion to approve and amend the fees. Mayor Paden made a substitute motion for a flat fee per player based on the amount of participation. Vice Mayor Kairis motioned to table the item, with a second by Mayor Paden.

Motion to Table

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RESULT:

MOVER:

SECONDER:

AYES:

NAY:

Passed
Council Member Mark Kairis
Council Member Travis Paden
Travis Paden, Kalish Morrow, Lou Martinez, Mark Kairis
Diane Sharp
PUBLIC HEARING:

A. Community Development: Annexation 162: A request to annex 12.17 acres into the City of Hanford from the Kings County jurisdiction and cancel the Williamson Act Contract for the property. Prezone No. 0001-23: A request to prezone the land proposed to be annexed as R-L-5 Low-Density Residential, in accordance with the General Plan designation for the territory, Low-Density Residential. Tentative Tract 940 (Stonehaven):

A request, by D.R. Horton, to subdivide the 12.17 acres proposed to be prezoned R-L-5 Low-Density Residential into 82 single-family residential lots. Planned Unit Development No. 13-23: A request to deviate from the standards of the Hanford Municipal Code, in order to utilize the small lot provisions of Section 17.10.100 to allow:

1. Reduced lot sizes between 3,600 – 4,999 square feet

2. Reduced lot widths

3. Reduced lot depths

4. Reduced setbacks

5. Exception: No limitation on the width of the garage (standard regulation limits garage width to no more than 50% of the residence’s frontage) The Project is located south of Hanford Armona Road, between 12th and 13th Avenues (APN011-040-030) Mayor Paden opened the public hearing at 10:17 p.m. and called for the staff report. Senior Planner Gabrielle Myers presented the staff report and invited questions from the Council. During the public hearing, Council Member Morrow motioned to extend the time of the meeting to 10:35 p.m. Seconded by Council Member Sharp. Motion passed 5-0.

Public Comment:

IN-FAVOR:

Mathew Chavez, D.R. Horton Forward Planner, spoke in favor of the annexation.

OPPOSSED:

Judy Mellow questioned the land usage.

Senior Planner Gabrielle Myers addressed the public comments and answered questions from the Council. After a brief discussion, Vice Mayor Kairis motioned to approve all 5 recommended motions as presented.

RESULT:

MOVER:

SECONDER:

AYES:

Passed (UNANIMOUS)
Council Member Mark Kairis
Council Member Kalish Morrow
Travis Paden, Kalish Morrow, Lou Martinez, Mark Kairis, Diane Sharp The Mayor closed the public hearing at 10:20 p.m.

COUNCIL COMMENTS AND COMMUNICATIONS:

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None.

B. Upcoming Events and Important Dates:

October 3: HPD 2023 National Night Out 6:00 p.m. - 8:00 p.m. in Civic Park October 7&8: Renaissance Fair 10:00 a.m. - 6:00 p.m. in Civic Park October 14: Oktoberfest 5:00 p.m. - 9:00 p.m. in Civic Park-Benefit For the Hanford Police K9 Foundation: Get tickets here
October 17: Regular City Council Meeting
ADJOURNMENT:

Mayor Paden adjourned the meeting at 10:25 p.m.

Respectfully submitted,
/s/ Natalie Corral
City Clerk

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13.C.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Appointment of Judy Scott to the Parks and Recreation Commission's unscheduled vacancy with a term ending on 12/31/2024.

Recommendation: That the Mayor, with approval of the full City Council, appoint Judy Scott to the Parks and Recreation Commission to fill the unscheduled vacancy with a term ending 12/31/2024.

Background:

The Parks and Recreation commission has one unscheduled vacancy due to a resignation. Ms. Judy Scott is currently the Alternate Commissioner on the Parks and Recreation Commission; she has expressed interest in the unscheduled vacancy and would like to move from the alternate seat to fill the vacancy with a term expiring on December 31,2024.

Section 2.20.030 of the City of Hanford Municipal Code states that:

"Vacancies occurring due to resignation or other cause, shall be noticed as required by state law and appointment made by the mayor at the earliest date possible. All such appointments shall be approved by a majority of the members of the city council."

If the Council appoints Ms. Scott to fill the unscheduled vacancy, the City Clerk will notice the vacancy for the Alternate Commissioner seat, and bring back staff's recommendation for the Council's approval.

ATTACHMENTS:

None

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13.D.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Adoption of Resolution 23-45-R, amending the city's email correspondence retention period from three (3) years to two (2) years.

RECOMMENDATION:

Staff recommends the City Council, by motion, adopt Resolution 23-45-R, thereby amending the city's email correspondence retention period from three (3) years to two (2) years BACKGROUND:

In 2012, the City Council adopted Resolution 12-47-R, approving the City Clerk to use the Secretary of State Local Government Records Retention Guidelines as the Hanford City-wide Records Retention Program. The current retention for general correspondence is three (3) years. With the city moving to Office 365 (O365) and a new email server platform, at the time of implementation, the city will have some choices of how long emails should be retained.

After a review of retention schedules from cities responding to the City Clerk's outreach, it was determined that a two (2) year retention period is common practice. The City Attorney supports the recommendation of a two-year retention for email correspondence with the suggestion that emails not be automatically deleted without checking their content. Emails relating to matters subject to litigation will not be eliminated until the matter is resolved.

A records retention schedule is an essential tool for managing government records. Retention schedules specify a minimum retention period for records based on the records' administrative, fiscal, legal, and historical value. State and local government agencies may create their own records retention schedules that must comply with Government Code §34090. Currently, staff is requesting authorization to revise the City's Retention Policy, only in regard to email correspondence because of the new email server platform. In the future, staff would like to present a comprehensive updated retention schedule that will be specific to each department, but also comply with Federal and State statutes.

FISCAL IMPACT:

There is no fiscal impact associated with this item.

ATTACHMENTS:

1. RESOLUTION NO 23-45-R

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RESOLUTION NO. 23-45-R

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HANFORD,

CALIFORNIA, APPROVING AN AMENDMENT TO THE CITYWIDE EMAIL

CORRESPONDECE RETENTION SCHEDULE
WHEREAS, by Resolution No. 12-47-R (2012), the City Council of the City of Hanford approved the use of the Secretary of State Local Government Records Retention Guidelines as the Hanford citywide records retention program; and
WHEREAS, according to the Secretary of State Local Record Retention Guidelines, the current general correspondence retention is three (3) years, and; WHEREAS, the city will move to new email server platform, with the choice of how long emails should be retained; and
WHEREAS, the city has found that the common email retention in surrounding cities is two (2) years; and
WHEREAS, the approval of the amendment to the citywide email correspondence retention insures compliance with Government Code §34090.

NOW, THEREFORE, BE IT RESOLVED, that the City Council adopt the amendment to the email correspondence retention to two (2) years.

PASSED, ADOPTED AND APPORVED at the regular meeting of the City Council of the City of Hanford held on November 7, 2023, by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

TRAVIS PADEN
MAYOR

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ATTEST
Natalie Corral
City Clerk

STATE OF CALIFORNIA )
COUNTY OF KINGS ) ss

CITY OF HANFORD )
I, Natalie Corral, City Clerk of the City of Hanford, do hereby certify the foregoing Resolution was duly passed and adopted at a regular meeting of the City Council of the City of Hanford held on the _____day of ______, 20___.

Date: ____________________
_________________________________
City Clerk

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13.E.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Adoption of Resolution 23-46-R, amending the Handbook of Rules and Procedures to include various amendments as recommended by Council.

RECOMMENDATION:

Recommendation: That the City Council, by motion, Adopt Resolution 23-46-R, amending the Handbook of Rules and Procedures to include various amendments as recommended by Council.

BACKGROUND:

Historically, past City Councils have adopted various policies and rules pertaining to City Council meetings, decorum, appointments to Commissions, and several other subjects. These policies were memorialized in a varied manner as resolutions, ordinances, and regular documents, all of which had been officially approved at Council meetings.

On June 21, 2016, the Hanford City Council formally adopted the Handbook of Rules and Procedures, in order to create one (1) single document for all rules and procedures and to eliminate the multiple references to other regulations. Since the initial adoption, there have been several amendments to the Handbook, which have included, but are not limited to, changes to the length of the Public Comment period.

At the May 16, 2023 Council meeting, during the Future Agenda Items section of the agenda, a request was made for a formal review of the Handbook by this Council and the matter was scheduled based on Council Consensus to move the item forward to a regular agenda. In response to the formal request by Council, staff felt that it was the ideal time to review the full document with the current Council and get direction any potential amendments.

On August 1, 2023, Council received an overview of the Handbook, which included a few staff-level amendments, and provided extensive directions on additional amendments that Council wanted to see added, deleted or modified. On October 17, 2023, Council was presented with a proposed final version of the amended handbook. A couple of additions were recommended and are incorporated in the redline and final versions of the handback that are a part of this agenda item.

Some of the major changes are as follows:
• Clarification of the time frame for the selection of Mayor and Vice-Mayor and the procedure for selecting the officers

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• Removal of city departments as that information is regularly updated in the Council-adopted budget
• Clarification on Study Sessions and the legal ability of Council to provide formal direction on those matters
• Amendments to the "Components of the Meeting" to reflect current practice • Addition of a policy on the useage of electronic communication by Council members while on the dais
FISCAL IMPACT:

ATTACHMENTS:

1. Handbook Resolution 23-46-R

2. Handbook of Rules and Procedures - 2023 Redline Draft (TNM redline)

3. Handbook of Rules and Procedures - 2023 Final

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RESOLUTION 23-46-R

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HANFORD AMENDING

THE HANDBOOK OF RULES AND PROCEDURES OF THE CITY COUNCIL OF THE

CITY OF HANFORD
WHEREAS, the policies, rules and procedures set forth in the attached Handbook are useful to the City Council, Commissions, Staff, and the General Public by eliminating multiple references; and
WHEREAS, pursuant to Government Code Section 36813, the Council may establish rules for the conduct of its proceedings; and
WHEREAS, this Handbook may be amended by resolution to modify or establish other policies relative to the City Council.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Hanford does hereby approve the attached amended Handbook of Rules and Procedures.

PASSED, ADOPTED AND APPROVED this day of , 2023 by
the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

TRAVIS PADEN
MAYOR of the City of Hanford
Attest:

NATALIE CORRAL

CITY CLERK

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STATE OF CALIFORNIA)
COUNTY OF KINGS ) ss

Date:

City Clerk

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HANDBOOK OF

RULES AND

PROCEDURES

HANFORD CITY

COUNCIL

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PREFACE
As provided by California Government Code Section 36813, the City Council of the City of Hanford established the Handbook of Rules and Procedures contained therein. The Handbook shall be in effect upon adoption by the City Council and shall remain in effect until such time as it is amended or new rules are adopted in the manner provided herein.

In addition to the Handbook of Rules and Procedures, the City Council has included in this document other information which may be useful to the City Council, Commissions, administrative staff, and the general public. This document is to be known as “The Handbook of Rules and Procedures of the City Council of the City of Hanford.”
Adopted: June 21, 2016
Resolution: 16-31-R
Amended: June 6, 2017
Resolution: 17-34-R
Amended: August 15, 2017
Resolution: 17-44-R
Amended: July 7, 2020
Resolution: 20-14-R
Amended: November 7, 2023
Resolution: 23-46-R

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TABLE OF CONTENTS
CHAPTER 1 – GENERAL POWERS AND DUTIES
A. The City of Hanford................................................................................1 B. Council Elections ...................................................................................1 C. Vacancies ..............................................................................................2 D. Mayor/Vice Mayor Selection..................................................................2 E. Mayor as Presiding Officer and Duties Thereto.....................................2 F. Vice Mayor .............................................................................................2 G. Compensation .......................................................................................3 H. City Manager .........................................................................................3 I. City Clerk.................................................................................................3 J. City Attorney..........................................................................................43 K. Triangle of Policy, Process & Product ..................................................54 L. Municipal Code ......................................................................................5 M. Interference in Staff Functions ..............................................................5 N. City Departments...................................................................................5 CHAPTER 2 – CITY COUNCIL MEETINGS
A. Rules of Order .....................................................................................69 B. Regular Meetings.................................................................................69 C. Special Meetings .................................................................................69 D. Study Sessions....................................................................................69 E. Closed Sessions ................................................................................710 F. Emergency Meetings .........................................................................811 G. Agenda ..............................................................................................811 H. Call to Order ......................................................................................811 I. Quorum ...............................................................................................811 J. Lack of Quorum..................................................................................811 K. Rules of Discussion ...........................................................................912

1. Motions..........................................................................................912

2. Voting ............................................................................................912

3. Abstention/Recuse: Conflict of Interest .........................................912

4. Tie Votes .......................................................................................103 L. Recognition to Speak, Council Member............................................103

1. Interruptions ..................................................................................103

2. Public Hearings .............................................................................103 M. Council Members’ Obligation After Absence.....................................103 N. Adjournment of Meeting ....................................................................104 O. Recess ..............................................................................................114 P. Agenda Items of Order ......................................................................114 Q. Audio Recordings ..............................................................................114 R. Video Recordings ..............................................................................114 S. Agenda Format for Meetings .............................................................114

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T. Components of Meeting.....................................................................125

1. Public Comments .........................................................................125

2. Staff Communications ..................................................................125

3. Consent Calendar ........................................................................125

4. Public Hearings ............................................................................125

5. General Business .........................................................................136

6. Council Reports/Comments .........................................................136 U. Ordinances ........................................................................................136 V. Resolutions ........................................................................................147 W. Recognitions/Proclamations .............................................................147 X. Minutes ..............................................................................................147 Y. Appeals..............................................................................................147 CHAPTER 3 - DECORUM

A. Enforcement of Decorum.................................................................1518 B. Conduct in the City Council Chambers............................................1518

1. Council Chambers Defined ........................................................1518

2. Council Dais ...............................................................................1518

3. Rules of Decorum for the Public.................................................1518

4. Rules of Conduct and Safety......................................................1618

5. Removal from the Council Chambers ........................................1619 C. Courtesy ..........................................................................................1619

1. Council Members .......................................................................1619

2. Public Speakers .........................................................................1619

3. Appointed Members of Commissions and Committees .................20 D. Disciplining a Disruptive Member ....................................................1720 E. Noise in the Lobby ...........................................................................1821 F. Distribution of Literature and Other Materials
in City Council Chambers ................................................................1821 CHAPTER 4 – PROCLAMATIONS, CERTIFICATES, AND OTHER

ACCOLADES
A. Purpose ...........................................................................................1922 B. Guidelines........................................................................................1922 C. Policy ...............................................................................................1922 CHAPTER 5 – CITY COMMISSIONS
A. Appointments.......................................................................................24 B. Attendance...........................................................................................24 C. Relationship to Council, Staff and Media.............................................25 D. Public Appearance and Representation by Members .........................25 E. Other Rules and Procedures ................................................................25

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CHAPTER 56 – ADMINISTRATIVE RULES
A. Rules and Procedures Administration .............................................2126

1. Review of City Council Rules and Procedures...........................2126

2. Adherence to Rules and Procedures .........................................2126

3. City Attorney as Rules and Procedures Advisor ........................2126

4. Applicability of Rules and Procedures............................................26 B. Conflict with City Municipal Code, Administration Policies, State or Federal Law .......................................................................2126

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1 CHAPTER 1

GENERAL INFORMATION, POWERS AND DUTIES
A. THE CITY OF HANFORD
The City of Hanford has a City Council/City Manager form of government.

Under this form of government, the elected City Council sets the policies for the operation of the Hanford City Government. The Council is responsible to the citizens for:
•Establishing community-wide goals that address short and long rangeshort- and long-range needs.
•Formulating policies that define a course of action that shape city operations. •Providing quality services within available resources. •Acting as a link between the professional staff and local citizens.

City Council members are local leaders. The electorate expects the Council to set the tone and direction for municipal operations. Strategic planning and goal setting are the tools that enable a Council to define their vision and determine methods for accomplishing their goals.

The administrative responsibility of the City rests with the City Manager, who is appointed by the City Council. The City Manager has the responsibility to apply and administer Council’s policies through the day-to-day operation of the City. The City Manager is the chief administrative officer of the city and directs the totality of city operations.

Teamwork between the Council and the City Manager is a key element of the council-manager form of government. The pooling of skills is essential to resolve the many complex problems that face the City today. The council-manager form of government seeks to enhance the effectiveness of local policy-making and municipal operations by bringing together skilled lawmakers, community representatives, and experts in municipal administration and management.

B. COUNCIL ELECTIONS
The City Council consists of five (5) members, elected by district. Each Council Member serves four-year staggered terms, without limit. Elected Officials serve until his/her successor has been elected and qualified. Elections are held in November of even numbered years.

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2 C. VACANCIES
Vacancies on the City Council shall be filled in accordance with California Government Code 36512.

California Government Code Section 36502 specifies the conditions under which a vacancy occurs.

D. MAYOR/VICE MAYOR SELECTION
Following a General Municipal Election, the Mayor and Vice-Mayor shall be selected at the meeting where election results are confirmed and the new City Council members are seated. (This meeting will either be in late November or early December).

In alternating years (i.e. when there is no General Municipal Election) the Mayor and Vice-Mayor shall be selected at the first Regular City Council meeting in December. The selection process is conducted pursuant to Robert’s Rules of Order as Rosenberg’s Rules is silent on the matter.

Consistent with Robert’s rRules, the City Attorney shall oversee the nominations and elections of the Mayor and Vice-Mayor. Council members may nominate one or more candidates. The different names shall be repeated by the City Attorney as they are made, and then the vote is taken on each in the order in which they were nominated, until one is elected. The nominations need not be seconded. These positions typically serve a period of one (1) year.

Although the Mayor and the Vice-Mayor have additional ceremonial, parliamentary and administrative responsibilities as described below and elsewhere in this Handbook, with respect to the establishment of policies, voting, and in other significant areas, all members are equalThe Mayor and Vice Mayor are members of the City Council and selected by the Council and not elected by the voters. These positions typically serve a period of one (1) year.

E. MAYOR AS PRESIDING OFFICER AND DUTIES THERETO
The Mayor shall be recognized as the official head of the City of Hanford for all ceremonial purposes and by the Governor for military purposes. In the time of public danger or emergency, the Mayor may, with the consent of the City Council, cause order to be maintained and enforce laws. The Mayor shall act as the Presiding Officer at all meetings of the City Council and perform such other duties consistent with the office as may be imposed by the City Council. The Mayor may move, second, and debate from the Chair, subject to such limitations of debate as are imposed on all Council Members by these rules and shall not be

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3 deprived of any of the rights and privileges of a Council Member as such Presiding Officer. The Mayor shall possess no veto power.

The Mayor shall preserve strict order and decorum at all times. The Mayor shall state each item coming before the City Council, and shall upon conclusion of said presentation related thereto call for the vote. Following the vote, the Mayor shall announce the results of the vote. The Mayor is eligible to vote on all motions, and shall direct the order of participation of Council Members. The Mayor shall, in all instances, have the last chance to speak. The Mayor shall sign all ordinances and resolutions adopted by the City Council during the Mayor’s presence. The Mayor shall sign all agreements and/or contracts, except where otherwise instructed or set forth by policy.

F. VICE MAYOR
In the absence of the Mayor, the Vice Mayor shall possess and perform the power and duties of the Mayor. In that capacity, the Vice Mayor shall sign ordinances and resolutions adopted in his/her presence. The Vice Mayor shall also sign all agreements and/or contracts, except where otherwise instructed or set forth by policy.

G. COMPENSATION
Salaries for the City Council Members may be fixed in accordance with Section 36516 of the Government Code of the State of California. Council Members may be reimbursed for actual and necessary expenses incurred in the performance of their official duties as allowed by Government Code Section 36514 and any resolutions or ordinances adopted by the City.

H. CITY MANAGER
The City Manager, appointed by the City Council, is responsible for the overall administration of the City in response to the policies and programs established by the City Council. The City Manager is responsible for forecasting the program and service needs of the City and its related financial, personnel, and capital improvement requirements. The City Manager is a significant liaison with the community and other levels of government.

I. CITY CLERK
The City Clerk is appointed by the City Manager and is the local official for elections, local legislation, the Public Records Act, the Political Reform Act, and the Brown Act (open meeting laws). The City Clerk, in consultation with the City Attorney, ensures that actions are in compliance with all federal, state and local

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4 statutes and regulations and that all actions are properly executed, recorded, and archived.

The statutes of the State of California prescribe the basic functions and duties of the City Clerk, and the Government Code and Election Code provide precise and specific responsibilities and procedures to follow.

The Office of the City Clerk is a service department within the municipal government upon which the City Council, all city departments, and the general public rely on for information regarding the operations and legislative history of the city. The City Clerk serves as the liaison between the public and City Council and provides related municipal services. The City Clerk provides clerical support to the City Council.

J. CITY ATTORNEY
The City Attorney, appointed by the City Council, is responsible for providing necessary legal services and guidance to the City Council, the City Manager, department heads, and city boards, commissions and committees to ensure that city functions are performed on a sound legal basis.

In the event that it is deemed necessary and in the best interest of the City to contract for either Special or Conflict Counsel to act in the place of the City Attorney, the City Manager shall bring forth a recommendation to the City Council for approval at a regular or special meeting and be designated to execute the necessary documentation to facilitate those contracts. If outside legal counsel is required due to a reason other than a conflict of interest affecting the City Attorney, the City Manager shall confer with the City Attorney regarding the hiring of Special Counsel.

Communications from the City Attorney’s Office may be confidential and shall be treated as attorney-client privilege. Only the City Council, as an entire body, may waive the privilege, and not individual Council Members.

During the normal course of a Council Member carrying out the duties of office, it is common practice to discuss issues or ask questions of city staff, including the City Attorney. For the purpose of this policy statement, the intent is to regulate an individual Council Member’s authority to cause work to be performed by the City Attorney.

When an individual Council Member poses a question to the City Attorney, the City Attorney shall estimate the amount of time required to answer the question.

In the event the City Attorney believes the amount of time for research involved in answering the question will generate a bill in excess of $600.00, the City Attorney will notify the Council Member that the answer will exceed policy limitations. If the submitting Council Member continues to seek an answer to the question, the Council Member will pose the question to the Council, as a body, at

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5 a Council Meeting and must obtain a consensus of the majority of the Council Members present at the meeting in order for the City Attorney to work on the question.

Legal work involving questions or inquiries that require less than $2,500.00, per year, in billable hours by the City Attorney may be authorized by the submitting Council Member without the need of obtaining the Council’s approval.

K. TRIANGLE OF POLICY, PROCESS & PRODUCT
The City Council establishes the Policy—establishing vision and direction for the community’s future.

The City Clerk, in consultation with the City Attorney oversees the Process— ensuring that the decision-making process complies with federal, state, and local regulation and that it is properly recorded.

The City Manager provides the Product—which is the primary reason for the existence of local government: to provide services to the taxpayer that the taxpayers cannot (or will not) provide for themselves.

L. MUNICIPAL CODE
The Hanford Municipal Code sets forth the regulatory, penal and administrative laws of general application to the city. These laws are enforceable by the City, and violation constitutes a misdemeanor or infraction.

Other directives and policies of the City Council are recorded in resolutions or by minute action of the Council.

M. INTERFERENCE IN STAFF FUNCTIONS
The City Council shall deal with the administrative services of the City through the City Manager, except for the purpose of inquiry, and neither the City Council nor any member thereof, shall give orders to subordinates of the City Manager.

No member of the City Council shall publicly criticize or censure any staff member of the City, and shall instead relay any criticism of a staff member privately through the City Manager.

The City Council shall deal with the Office of the City Attorney only through the City Attorney or his/her designees, except for the purpose of inquiry, and neither the City Council nor any member thereof, may give orders to subordinates of the City Attorney without the City Attorney’s consent.

N. CITY DEPARTMENTS

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6 Administration – In addition to the City Manager and City Clerk, the administrative office also includes Human Resources, Information Technology and the Airport division. Human Resources is responsible for risk management, insurance services, and the city's comprehensive personnel program, including recruitment, classification, compensation, employee benefits, safety administration, and employee training.

Information Technology is responsible for design and maintenance of the city’s software systems and administration of the City’s Local/Wide Area Network. This division also manages the City’s web services and intranet.

Airport operations oversee all matters pertaining to the airport.

Finance – The Finance department is composed of two divisions, the Accounting division and Utility Billing division. The Accounting division is responsible for cash management, financial management services, payroll, purchasing, accounts payable and receivable, and business license administration.

The Utility Billing division is responsible for customer services for Refuse, Sewer, and Water operations. This includes all billing, collections, and adjustments as necessary.

Community Development – The Community Development department includes three divisions: Planning, Building, and Housing. The Planning division is responsible for administering the city's general plan and zoning ordinance, and provides support services to the planning commission.

The Building division is responsible for ensuring that construction activities in the city meet all requirements of the Uniform Building Code. The division issues building permits and provides inspections as needed to ensure that buildings are constructed in accordance with the approved plans. The Building division also provides city-wide code enforcement services and abates dangerous buildings to ensure they do not pose a hazard to the community.

The Housing division is responsible for assisting in the development, rehabilitation and maintenance of affordable housing in our community. This division provides funds for the CDBG Housing Rehabilitation Grant Program, the BEGIN/HOME Programs, First-Time Homebuyers Program, and the processing and monitoring of all housing rehabilitation projects.

Parks & Community Services – The Recreation division operates recreational and leisure activities for the community of Hanford. It is composed of administrative services, sports, youth/cultural/special events, Longfield Center, aquatics, senior center, teen center, facilities management, and therapeutic recreation. Hanford’s recreation department offers a full range of recreational activities for nearly every segment of our community. The Parks and Community

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7 Services department provides recommendations to the Parks and Recreation Commission.

The Parks division is responsible for maintaining the aesthetic and recreation value of city property including city parks, street medians, athletic fields, city parking lot landscapes, the Industrial Park, Airport Park, and the Intermodal Station. The division designs and constructs streetscape improvement projects within the Downtown District; administers the Landscape Assessment District contracts; repairs citywide irrigation systems; performs annual playground safety inspections; and conducts repairs and upgrades to existing playgrounds.

The Facilities division is responsible for the maintenance and repair of all city owned facilities. This includes the civic auditorium, city offices, veterans building, historic courthouse, intermodal facility, public works corporation yard, wastewater treatment plant, Longfield Center, aquatics facility, police department, and fire stations. This is accomplished through a staff of full time and part-time employees.

Public Works – The most complex department in the City of Hanford is the public works department. It is composed of Administration/Engineering, Streets, Refuse, Fleet, Wastewater, and Utilities.

The Administration and Engineering division is responsible for the design and supervision of all capital improvement projects as well as administering the entire public works department. This division is also responsible for providing recommendations to the City Council and Commissions.

The Streets division is composed of two programs: street maintenance and street cleaning. Street maintenance is primarily responsible for maintenance of local streets and city parking lots as well as supervising painting activities, maintenance of traffic signals and streetlights, and other maintenance activities.

The street-cleaning program is responsible for sweeping of all city streets on a periodic basis.

The Wastewater Treatment plant is a sophisticated, multimillion dollar facility responsible for the treatment and recycling of all city wastewater. This division is also responsible for maintaining the sanitary sewer collection system. The plant uses state of the art techniques and continues to meet all applicable water quality standards.

The Refuse division provides refuse pickup, recycling, and disposal services for all businesses and residents of the city, as well as some residents located in unincorporated areas around the city.

The Fleet Maintenance division is responsible for maintaining and managing a diverse fleet of equipment including sedans, police vehicles, street sweepers,

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8 refuse trucks, motor graders, sewer cleaning equipment, fire vehicles, and other specialized pieces of large and small equipment. The city’s fleet maintenance program is set up as a leasing operation with all costs accumulated in this program and charged out to city departments.

The Utilities division is composed of two program areas: storm sewer maintenance and water operations. The storm sewer maintenance section is responsible for maintaining storm drain facilities within the city. The water operations section is responsible for the operation and maintenance of the city water system.

Police – The Police department is responsible for providing police services to preserve the peace and ensure the general safety and welfare of city residents and visitors. The department is organized into multiple areas: support services, records and communications, operations, narcotics task force, traffic enforcement, school resource officer program, and the problem-oriented policing (POP) program. These divisions work cooperatively to maintain a low crime rate with a community approach to law enforcement.

The Support Services division is responsible for the overall administration of the police department and investigative services. This division also administers the Gang Resistance Education (G.R.E.A.T.) program in conjunction with the Hanford Elementary School District and Hanford Joint Union High School District.

The Records and Communications division is responsible for providing communications, clerical support, and police records management for the police department.

The Operations division is responsible for patrol services, traffic enforcement, and development of a highly responsible force for both emergency and service needs.

The Traffic Enforcement division focuses on traffic education and enforcement, driving under the influence enforcement, seat belt and child restraint education, and bicycle and pedestrian safety in our community.

The School Resource Officer (SRO) program is a cooperative program with the Hanford Joint Union High School District and the purpose of the program is to provide guidance to our youth and to maintain a safe environment at the three (3) Hanford High School campus sites.

The Problem Oriented Policing (POP) program provides specialized police services through community partnerships with citizens to reduce criminal activities in our community. The division concentrates its efforts on developing specific strategies and projects to solve issues within the community.

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9 Fire - The fire department is responsible for the prevention and suppression of fires in the community. The department is broken into two divisions:
administration/suppression and fire prevention.

The Administration/Suppression division is responsible for administering the department, as well as providing suppression services when fires occur.

The Prevention division is responsible for building inspections, plan review, weed abatement, and citizen education programs.

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10 CHAPTER 2

CITY COUNCIL MEETINGS
A. RULES OF ORDER
The City Council shall determine its own rules of order and amend them from time to time, ortime or adopt new rules as it deems necessary. The City of Hanford shall follow Rosenberg’s Rules of Order and incorporate the procedures set forth in this chapter.

The City Attorney acts as the parliamentarian and advises the Mayor when points of order are raised.

B. REGULAR MEETINGS
Regular meetings of the City Council shall be open to the public and held on the first and third Tuesdays of every month, at the hour of 7:00 p.m. The business to be considered during the council meeting is detailed on a printed agenda. State law (the Ralph M. Brown Act) requires that public notice be given at least 72 hours before the regular meeting indicating the time and place of the meeting. An agenda of each meeting is posted at City Hall. Regular meetings may be adjourned or continued to a specified time and place.

Whenever the day fixed for any regular meeting of the City Council falls upon a day designated as a holiday, such meeting may be held at the same hour on the next succeeding day, not a holiday, as if it were a regular meeting or the meeting may be cancelled.

C. SPECIAL MEETINGS
A special meeting may be ordered whenever the public business may require it or upon the request from three members of the City Council. Whenever a special meeting shall be called, notice of such meeting shall be provided at least 24 hours prior to the time of the meeting pursuant to State law.

Ordinances may not be adopted at special meetings; only urgency ordinances may be adopted at such meetings. Items not listed on the agenda shall not be considered at the special meeting.

D. STUDY SESSIONS
The City Council may meet in a “study session” for the purpose of acquiring information on a particular subject(s) or hold “work sessions” for the purpose ofand collaborating with the public through individual public comment periods.

These sessions are considered special meetings andthat shall be open to the public and comply with the Brown Act. Additionally, as special meetings, Council

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11 may act upon an item contained in the agenda and may provide formal direction to staff on consistent with the agenda wording for each item.

E. CLOSED SESSIONS
Consistent with Government Code Section 54954.2 the Council may hold closed sessions during any regular or special meeting, or any time otherwise authorized by law to consider or hear any matter which is authorized by State law to be heard or considered in closed session.

The general subject matter for consideration shall be expressed in an open meeting before such session is held. After closed session the legislative body must reconvene to open session and may be required to disclose action taken, if any.

Closed sessions may be held to discuss certain matters specified by law, including:
•Personnel matters to consider the appointment, employment, performance, or dismissal of a public employee
•Matters of national and public safety
•Labor negotiations
•License applications by persons with criminal records
•Real estate negotiations
•Anticipated litigation
The legislative body in a closed session can consider only matters covered in its agenda descriptions. City Council Members shall keep all written materials and verbal information provided to them in closed session in complete confidence in accordance with Government Code section 54963. No mention of information in these materials should be made to anyone unless allowed by this statute.

If the City Council in closed session has provided direction to city staff on proposed terms and conditions for any type of negotiations whether it be related to property acquisition or disposal, a proposed or pending claims or litigation, and/or employee negotiations, all contact with the other party should be by the designated representative handling the negotiations or litigation. A Council Member should not have any contact or discussions with the other party or its representative(s) involved concerning the negotiation during this time and not communicate any discussion conducted in closed sessions. All public statements, information, press releases, should be handled by the designated representative or spokesperson.

Government Code Section 54963 (a) – (f) outlines the injunctive relief and disciplinary actions that may be imposed on those who divulge confidential

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12 closed session discussions, without first receiving authorization from the legislative body.

F. EMERGENCY MEETINGS
Emergency meetings may be called by the City Council with one-hour notice to its members and local news media. The City Council may not meet in closed session during an emergency meeting. Except for the 24-hour notice requirement, the special meeting requirements set forth above shall apply in emergency meetings.

G. AGENDA
In order to facilitate the orderly conduct of the business of the citizens of Hanford, the City Manager and City Clerk shall set the agenda, in addition to any direction by the City Council. The City Clerk shall arrange such matters as may have been timely provided, for inclusion in the agenda. Copies of the agenda are available at City Hall and at the council meeting, as well as posted on the city’s website.

H. CALL TO ORDER
The meetings of the City Council shall be called to order by the Mayor, or in the Mayor’s absence, by the Vice Mayor. In the absence of the Mayor and Vice Mayor, the meeting shall be called to order by the most senior Council Member present. This person shall serve as the Council’s presiding officer until the arrival of the Mayor or Vice Mayor, or until adjournment of the meeting.

I. QUORUM
Three members of the City Council shall constitute a quorum for the transaction of business. A majority of a quorum shall be sufficient to pass any action taken by the City Council except on such matters, which, by law, require a greater majority. All ordinances require at least three affirmative votes. Approval of resolutions and all orders for the payment of money also require an affirmative vote by a majority of the entire Council.

J. LACK OF QUORUM
If a majority of the City Council are absent from any meeting, the remaining members of the City Council may declare the meeting adjourned or if no member of the City Council is present, the City Clerk may adjourn the meeting. If a meeting is adjourned for less than five calendar days, no new agenda need be posted so long as a new item of business is not introduced. A copy of the order of adjournment must be posted within 24 hours after the adjournment, at or near the door of the place where the meeting was held.

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13 K. RULES OF DISCUSSION

1. Motions
Action items listed on the council agenda in accordance with applicable law, orlaw or added as an action item on a council agenda, in accordance with applicable law, may be voted on by the council.

Following a presentation of the item by staff, the Mayor will open discussion to the City Council for questions and comments. When there appears to be no further discussion or all of the Council Members have had the opportunity to speak, the Mayor may call for a motion.

Motions may be made by any member of the council, including the presiding officer, providing that before a motion is offered by the presiding officer, the opportunity for making a motion should be offered to the other members of the council. Any member of the council, other than the person offering the motion, may second a motion. Following a motion and a second, and any further discussion, the Mayor shall call upon the City Clerk for the vote.

2. Voting
The City Council utilizes an electronic voting system. , iIn the absence of an electronic voting systemdevice, the clerk shall ask for votes by “voice vote” on all matters before it, unless a roll call vote is required by law or is requested by the Mayor. Unless a Council Member states that he or she is not voting, silence shall be recorded as an affirmative vote. The Presiding Officer shall announce the results of the vote.

A majority, also known as a simple majority, is a subset of a group that is more than half of the members present.

A two-thirds majority means that two-thirds of the quorum must agree to the proposition. It is much stronger than a simple requirement. In the event of an absence the vote would have to be unanimous.

3. Abstention/Recuse: Conflict of Interest
Council Members shall disqualify themselves if they have a financial conflict of interest or any other disqualification prescribed by law in a matter before the City Council. In such event, they may not participate in the discussion or the vote. Council Members shall state the specific reason for such disqualification. The disqualified Council Member shall leave the Council dais until the conclusion of the agenda item unless applicable State law or regulations permit otherwise.

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14 It should be noted, however, a Council Member may speak as a member of the public, on his/her own behalf – as opposed to on behalf of someone else – on a matter that directly affects his/her financial interest even when conflicted out. Thus, while a Council Member would have to disqualify him/herself on a matter affecting a piece of property in which the Council Member has a financial interest, he/she could address the Council, speaking to what the impact would be to his/her property.

In some instances, a Council Member may determine that it is appropriate to abstain from voting on a matter even though no financial conflict of interest exists. If a City Council member abstains from voting, their vote will count as a negative. A Council Member is counted as present for quorum purposes, but his/her abstention is effectively a negative vote.

For example, if a matter requires three affirmative votes for approval and one Council Member abstains, at least three other Council Members must cast affirmative votes for the matter to be approved.

4. Tie Votes
A tie vote results in a lost motion. In such an instance, any member of the Council may offer a motion for further action. If there is no action by an affirmative vote, the result is no action. If the matter involves an appeal, and affirmative vote does not occur, the result is that the decision appealed stands as decided by the decision-making person or body from which the appeal was taken.

L. RECOGNITION TO SPEAK, COUNCIL MEMBER
Every Council Member desiring to speak shall address the Mayor and, upon recognition by the Mayor, shall confine his or her remarks to the item coming before the City Council.

1. Interruptions:

A Council Member, once recognized, may voice concerns, comments or ask staff to provide explanation or clarification of the item before the City Council, without interruption, unless out of order with the rules and procedures established herein and/or the Mayor call the item to order.

2. Public Hearings:

Council Members should not speak to the merits of an issue, other than to ask questions, until the public comment has been closed.

M. COUNCIL MEMBERS’ OBLIGATION AFTER ABSENCE
When a Council Member is absent from an earlier meeting at which a matter was discussed, it shall be the duty of that Council Member to become acquainted with the issues discussed by reading the documents presented, reviewing the minutes

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15 from the meeting in which that item was discussed, listening to or viewing the taped recording of the meeting missed in order to further participate in future discussions and/or vote on the item.

N. ADJOURNMENT OF MEETING
Regular meetings shall conclude no later than 10:00 p.m., unless the time is extended by a majority consensus of the Council.

The Mayor shall adjourn the meeting. In the instance of the lateness of the hour the Mayor may also adjourn the meeting to a date and time specific to continue discussions on either the remainder of the agenda or on a specific item for discussion.

O. RECESS
At any point during a meeting the Mayor may call for a brief recess.

P. AGENDA ITEMS OUT OF ORDER
The Mayor may, with the consent of the City Council, modify the order of the agenda at the meeting, if such modifications would promote fluidity in the process and discussions.

Q. AUDIO RECORDINGS
All regular meetings (except closed sessions) of the City Council are audio recorded, as well as special meetings. Workshops or meetings that require extensive interaction with the public, staff, and City Council may not be recorded if the length of the meeting is anticipated to be unusually long or if simultaneous discussions are expected to occur.

R. VIDEO RECORDINGS
All regular meetings (except closed sessions) of the City Council are video recorded, as well as any special meetings held in the Council Chambers. The City of Hanford allows the use of additional recordings as long as they are not being disruptive to the proceedings or to those in attendance. Any equipment being used should not block aisles, exits, or the view of others. If the use of equipment is determined to be disruptive by the legislative body, the use of said equipment may be banned. Council has identified an area against the East wall of the Chambers, just south of the Director’s box, where all video camera equipment should be setup for recording.

S. AGENDA FORMAT FOR MEETINGS

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16 The agenda format for the Hanford City Council and Commission meetings will be prepared to allow for an efficient method to conduct city business. The format and order of business will be established by the City Clerk, unless modifications are approved by the City Council.

T. COMPONENTS OF MEETING
The following sections of a regular meeting agenda shall set forth the guidelines of decorum for each respective section of the agenda.

1. Public Comments
For regular meetings, this is the time for citizens to comment on subject matters within the jurisdiction of the Hanford City Council, including matters listed on the meeting’s agenda and other matters not appearing on the agenda. For special meetings, citizen comments are, pursuant to the Brown Act (Government Code § 54950, et seq.) limited to matters on the agenda, and public comment will be accepted after each agenda item.

The Council cannot legally discuss or take official action on citizen requests that are introduced under this section.

This is also the time for citizens to comment on items listed under the Consent Calendar or General Business, or to request an item from the Consent Calendar be pulled for discussion purposes. Comments related to Public Hearing items will be heard at the time the item is discussed.

Each speaker will be allowed three minutes, but the Mayor has the discretion to shorten the time limit to make an efficient use of the Council’s time. As a courtesy, but not required, the speaker should state his/her name and provide their city of residence.

Any documents submitted by a member of the public to the City Clerk for the purposes of handing out to the City Council will be distributed and made a part of the record. The City Clerk will not read the documents out loud, but note who the correspondence was from.

2. Council Reports/General ReportsStaff Communications Brief, information-only reports, from City Council and/or Staff maywill provide updates to the City Council on major events or projects that may be of public interest. This is also the time for Council members to provide committee reports and to report on any meetings attended at the City’s expense. Any documents submitted by a member of the public to the City Clerk for the purposes of handing out to the City Council will be distributed and made a part of the record. The City Clerk will not read the documents out loud, but note who the correspondence was from.

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17 3. Consent Calendar
All Consent Calendar Items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made, in which event the item will be removed from the Consent Calendar to be discussed and voted upon by a separate motion.

4. Public Hearings
A public hearing is only required where a specific law or ordinance applicable to the item expressly requires a hearing or a hearing is required for constitutional reasons (usually to ensure "due process"). Sometimes the decision is made to hold a public hearing even though one is not required by law. In this case, the agenda documents will state that the public hearing is optional. Staff will open the item by providinge a report on the item, then the Mayor will open the hearing to public comments.

Public comments are subject to the rules and regulation of the Hanford Municipal Code. After closing public comments, the Mayor will allow the Council to provide questions or comments to the staff prior to making a motion. Once public comments are closed it is inappropriate for the public to speak except to answer an inquiry of a Council Member addressed through the Mayor. However, public comments may be re-opened by a majority approval by the Council to hear new information.

5. General Business
Any other remaining items requiring action may be placed in this section.

Items that do not need action, but are to provide informational or receive direction from the City Council may also be placed under General Business.

6. Council Reports/Comments
The City Council may report on other meetings or community events that they have recently attended. General announcements that may be of interest to the other Council Members or the public may be made at this time. If a Council Member receives any written correspondence that they would like to be a part of the record, they may announce that they received said correspondence and that it will be given to the City Clerk for distribution.

67. Items for Future Agendas
Any Council Member may request a matter which is not otherwise scheduled on a City Council agenda to be placed on a future agenda. The Council Member referring the item shall provide sufficient information as to the nature of the item. The City Council by concurrence of a majority may direct the City Manager to put the item on a future agenda.

U. ORDINANCES

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18 Ordinances are the laws of the municipality. City councils are given the power to pass ordinances by Government Code Section 37100 as long as those ordinances are not in conflict with the laws and Constitution of the State of California or the United States. Approval of an ordinance requires a first reading or introduction and a second reading and adoption, with at least five days between readings (except an urgency ordinance). The passage of an ordinance requires the affirmative votes of at least three (3) council members. The ordinance or a summary is then published in the local newspaper and becomes effective thirty (30) days later. The thirty (30) day time frame is known as a referendum period. A referendum period is required by state law and is a time frame in which any citizen can file a petition challenging the legality of a recently adopted ordinance. An ordinance is an action that can be repealed or amended only by a subsequent ordinance.

In matters deemed by the City Council to warrant immediate action to preserve peace, public safety or health, an urgency/emergency ordinance may be passed immediately upon introduction at either a regular or special meeting, and can be effective immediately.

V. RESOLUTIONS
A resolution sets forth the action of the council on certain types of policy, procedural, or administrative matters. It requires only one reading and may be changed by subsequent resolution.

W. RECOGNITIONS/PROCLAMATIONS
The City Council may recognize individuals, organizations, or activities during the meetings. Other organizations may also present recognitions to the City.

X. MINUTES
The City Council utilizes summary minutes, which include the motions made, action taken, and a brief summary of council, staff and/or public comments. The audio recording may be used for reference, but it is not the official record of the meeting.

The City Clerk shall prepare the Minutes, and upon approval of the City Council, it shall become the official record.

Y. APPEALS
The filing of an appeal shall have the effect of staying the issuance of any permit or action until such time as the matter on appeal is resolved. If there are subsequent items to come before the Council that are subject to the outcome of the appeal, those items shall be listed following the item for appeal on the

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19 agenda, the decision of which shall be factored upon the Council’s decision on appeal.

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20 CHAPTER 3

DECORUM
A. ENFORCEMENT OF DECORUM
The City Manager shall designate the Chief of Police, or his/her designated representative as a sergeant-at-arms when necessary to attend City Council meetings for the purpose of maintaining order and decorum in the City Council Chambers, lobby, or other designated meeting location. Upon instructions from the Mayor, the sergeant-at-arms shall eject any person from the City Council Chambers, in conformance with State law.

B. CONDUCT IN THE CITY COUNCIL CHAMBERS

1. Council Chambers Defined
Council Chambers shall be, in addition to the usual and customary meeting location, any location or facility wherein a majority of the legislative body may meet for an open and public meeting as defined by the Brown Act, whether it be a regular meeting, special meeting, or emergency meeting.

2. Council Dais
The City Council seating area, most commonly referred to as the Council Dais is restricted to Council and city staff at all times. Loitering or the dissemination of materials are not permitted in the area directly in front of the City Council seating area, commonly referred to as the well, unless invited by a Council Member to step forward. Written or photographic materials are to be handed to the City Clerk for dissemination to the Council, and made part of the record.

3. Usage of Electronic Communication Devices at the Dais It shall be the policy of the City Council that City Council Members, and any other members of the City’s Boards, Commissions, and Committees, shall not use electronic communications (i.e.text, emails) with anyone in the public, or between themselves, while at the dais and/or participating in a public meeting. Nothing in this policy shall preclude a Council Member from having their phone on the dais with them in the event of an emergency.

4. Rules of Decorum for the Public
Members of the audience shall not engage in disorderly or boisterous conduct, including the utterance of loud, threatening or abusive language, clapping, whistling, and stamping of feet or other acts which disturb, disrupt, impede or otherwise render the orderly conduct of the city meeting infeasible. A member of the audience engaging in any such conduct shall, at the discretion of the presiding officer or a majority of the City Council,

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21 be subject to ejection from the meeting per Government Code Section 54954.3(c).

54. Rules of Conduct and Safety
When the City Council is in session, all persons present must preserve safety and order. Members of the public should sit in the seats provided, subject to ADA compliance, unless addressing the Council or entering or leaving the Council Chambers. Members of the public shall not block the aisles or exits in any manner. Members of the public should not bring audible equipment into the Council Chambers, including cellular phones or pagers, without first either turning said equipment off or to a silent mode.

65. Removal from the Council Chambers
Any person who commits the following acts in respect to a meeting of the City shall be removed from the Council Chambers per Government Code Section 54957.9.
(a) Disorderly, contemptuous or insolent behavior toward the City or any member thereof, tending to interrupt the due and orderly course of said meeting; and,
(b) A breach of the peace, boisterous conduct or violent disturbance, tending to interrupt the due and orderly course of said meeting; and,
(c) Disobedience of any lawful order of the Mayor, which shall include an order to be seated or to refrain from addressing the City Council; and,
(d) Any other unlawful interference with the due and orderly course of said meeting.

C. COURTESY

1. Council Members
Council Members shall accord the utmost courtesy to each other, city employees and the public appearing before the City Council, and shall refrain at all times from rude and derogatory remarks, public criticism of staff, remarks as to integrity, abusive comments and statement as to motives and personalities.

2. Public Speakers
Members of the public have the right to attend City Council meetings and to address the City Council on specific agenda items and under the Public Comments section of the agenda. The right of the public to address the City Council includes their right to criticize the policies, procedures, programs, or services of the City, and the acts or omissions of the City Council members. Criticisms that do not relate to city business will not be tolerated.

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22 While the City Council meeting is in session, all persons must preserve order and decorum. A person who addresses the City Council under a specific agenda item or under Public Comments may not engage in speech or conduct which is likely to provoke others to violent or riotous behavior, which disturbs the peace of the meeting by loud and unreasonable noise, which is outside of the Council’s jurisdiction, repetitive, or which disrupts, disturbs, or otherwise impedes the orderly conduct of any City Council meeting.

The Mayor or other presiding officer shall request that a person who is breaching the rules of decorum cease such conduct. If, after receiving such a warning, the person persists in breaching the rules of decorum, the Mayor or other presiding officer may order the person to leave the City Council meeting. If such person does not leave, the Mayor or presiding officer may request any law enforcement officer who is on duty at the meeting as sergeant-at-arms to remove the person from the Council Chambers. In the event there is no one from law enforcement present, the Mayor or presiding officer may direct the City Manager to contact law enforcement.

3. Appointed members of Commissions and Committees
Appointed members of Commissions and Committees of the City shall observe the same rules of order and decorum applicable to the City Council.

D. DISCIPLINING A DISRUPTIVE MEMBER
If one member engages in disruptive behavior, it is the responsibility of the City Council to remind the disruptive member about their duties. The failure of the governing body to deal with a misbehaving member or commissioner can also have legal consequences for the locality. For example:

1. A City Council member or Commissioner that mistreats staff members by using inappropriate language, asking the staff member to perform personal tasks, hugging or touching staff in an inappropriate manner, etc. may be putting the locality at risk for a lawsuit alleging harassment or a hostile work environment. If the governing body does not take appropriate steps to avoid the appearance of agreement with the objectionable behavior of a fellow member or commissioner, the inappropriate behavior may be considered to have been sanctioned by the governing body.

2. A member that leaks a confidential legal opinion of the local government attorney can result in the loss of the attorney client privilege and with the loss of the attorney client privilege it is possible the opinion can be used in court against the locality. In order to protect the attorney client privilege the other members of the governing body need to take affirmative action against the member that leaked the opinion.

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23 In some instances meeting one-on-one outside of a public meeting can rectify a misunderstanding or correct inappropriate behavior. The manner in which a situation is addressed may be on a case by case basis. If the behavior continues or if the actions are more severe, the City Council may determine other methods of discipline.

The Mayor, with the approval by a majority of the Council, may remove a Commissioner from their seat. Similarly, a Council Member may be removed from his or her standing committee assignments as well as assignments to outside committees.

One of the most common forms of discipline is for the governing body to “censure” a fellow council member. A censure is a public statement condemning the member’s inappropriate behavior with the hopes of reforming him or her so that he or she will not behave in the same way again. Members can be censured for misconduct at meetings, failing to follow proper procedures, violating confidentiality, illegal or immoral conduct, absenteeism, lying, disloyalty, working against the organization, conspiracy, and violating other values that the Hanford City Council holds dear. With a consensus of the Council, a censure may be placed on a future agenda. Censures are then approved by a resolution.

E. NOISE IN THE LOBBY
Noise emanating from the lobby outside the City Council Chambers which disrupts City Council meetings shall not be permitted.

F. DISTRIBUTION OF LITERATURE AND OTHER MATERIALS IN CITY

COUNCIL CHAMBERS
No person, other than city staff, shall distribute flyers, leaflets, placards or other literature or circulate any petition within the City Council Chambers.

Flyers, leaflets, placards or literature may only be distributed to the Council by a member of the public under Public Comments, or by a project applicant/appellant pertaining to city business as may be referenced on the agenda, by approaching the City Clerk and requesting such material be distributed on their behalf.

Hand-held signs are permitted in the Council Chambers, but they cannot block the view of others in the audience or prevent the public from freely entering or exiting the room.

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24 CHAPTER 4

PROCLAMATIONS, CERTIFICATES, AND OTHER ACCOLADES
A. PURPOSE
The purpose of this policy is to establish uniform procedures, criteria, and identify authority.

B. GUIDELINES
The following are basic guidelines for recognition.

Proclamations – Generally proclaims certain periods of time (days, weeks, or months) in honor of an event or activity. Proclamations also may recognize individuals for extraordinary contributions they have made to the community.

They contain several biographical or informational paragraphs. Examples include Fire Prevention Week, Arbor Day, and American Red Cross Month.

Certificates – Certificates are prepared in response to the type of recognition desired and are to express appreciation for exemplary service or performance to individuals, teams, or organizations.

Other Tokens of Appreciation – These items include various forms of Hanford memorabilia and are distributed at the discretion of individual City Council Members, City Clerk or City Manager. For example, the City Clerk is often contacted for lapel pins and forwards them to the requesting parties.

C. POLICY
It is the policy of the City of Hanford to recognize individuals and/or organizations for their outstanding performance, or honor special events and dates with proclamations, certificates, plaques, or other tokens of appreciation in accordance with the criteria set forth below.

1.Request for proclamations, certificates or plaques from City Council Members, city departments, residents, and local organizations must be submitted to the City Clerk’s office.

2.Requests should specify:
(a) Reason why recognition should be granted; and
(b) Information that will assist the Mayor, City Council, or City Manager in arriving at a decision.

3.Requests by individuals or organizations for proclamations or certificates of recognition/appreciation are subject to approval by the Mayor and City Manager. The Mayor and City Manager will determine if

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25 it will be presented at a City Council meeting or will direct the City Clerk to forward the accolade to the recipient.

4.All requests for plaques, framed certificates, or custom gifts to visiting officials/dignitaries, elected officials, individuals or organizations shall be approved by the Mayor and City Manager.

5.Individual Council Members shall have the discretion to direct the City Clerk to prepare certificates (not framed) or another token of appreciation that he or she will personally present.

6.Requests for plaques, gifts or awards to city employees for dedicated service to the city shall be approved by the City Manager.

7.The Mayor and City Manager shall have the discretion to determine the appropriate type of honor for special or unusual circumstances that may arise and may warrant deviation from this policy.

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26 CHAPTER 5

CITY COMMISSIONS
A. APPOINTMENTS
The mayor, with the approval of the City Council, appoints citizens to various commissions that carry out designated functions and advise the City Council on certain decisions and policy matters. All members serve at the pleasure of the City Council for designated terms. The City Council may remove a member by a majority vote of the Council without cause, notice or hearing.

Members of advisory bodies serve terms of four (4) years beginning in January.

In no event shall any one member serve more than two consecutive terms on any one commission, exclusive of appointments to fill unexpired terms. After serving the maximum number of terms, an individual may not be reappointed to that commission for at least one year from the last date served.

Appointees to commissions should be 18 years of age or older, and live within the city limits of Hanford. Individuals under the age of 18 who indicate they are interested in participating are encouraged to attend meetings and participate as a member of the public. Additional requirements may be applicable to a specific Committee or Commission.

The following is a summary of the specific scope of responsibility for each city advisory body.

Planning Commission
The Planning Commission has the principal duty of establishing and maintaining the general plan of the community and advising on physical development, zoning, subdivision proposals, and special studies so that development values are maintained and protected.

Parks and Recreation Commission
The Parks and Recreation Commission's duties are to study and advise on matters pertaining to the city's public park and recreation programs.

Parking and Traffic Commission
The duties of the Parking and Traffic Commission are to investigate ways and means of improving parking and traffic movements and make appropriate recommendations.

B. ATTENDANCE

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27 A compilation of members’ attendance will be submitted to the City Council at the end of the calendar year and will be a factor in a request for reappointment.

Members may be removed by the City Council if they have three (3) consecutive absences or attend less than 70% of the meetings, unless extenuating circumstances apply and are noted for the record.

C. RELATIONSHIP TO COUNCIL, STAFF AND MEDIA
Advisory bodies should not become involved in the administrative or operational matters of city departments unless specifically provided in their prescribed powers and duties. Members may not direct staff to initiate major programs, conduct large studies, or establish department policy without specific approval of the City Council. City staff assigned to furnish staff services shall be available to provide general staff assistance, such as preparation of agenda/notice materials and minutes, general review of department programs and activities, and to perform limited studies, program reviews, and other services of a general staff nature. Additional or other staff support may be provided upon a formal request to the City Council. The responsibility for setting policies for the City rests with the City’s duly elected representatives, the City Council.

Members should refer all media inquiries to city staff and not provide statements or positions on any issues on behalf of the City or the Advisory Body.

D. PUBLIC APPEARANCE AND REPRESENTATION BY MEMBERS
When a member appears in a non-official, non-representative capacity before the public, for example in a Council meeting, the member shall indicate that he or she is speaking only as an individual, not as a member of a Commission.

Conversely, when a member who is present at a Council meeting is asked to address the Council on a matter pertaining to his or her Commission, the member should represent the viewpoint of the particular body as a whole, not a personal opinion. If during a Commission meeting, a member was directed by the body to attend another meeting to speak on their behalf, then that is permitted.

Members shall not act independently of their Commissions in conducting surveys, studies, or petitions, unless he or she is acting as an applicant or submitting a request as a citizen. Commissioners shall not use their positions for personal interest and must recuse themselves if conflicts of interest arise.

E. OTHER RULES AND PROCEDURES
Each Commission may adopt other rules and procedures, as it feels necessary to effectively and efficiently accomplish its duties. Such rules are subject to Council approval before becoming effective and should not be in conflict with this Handbook, or with any local, state, or federal laws.

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28 CHAPTER 6

ADMINISTRATIVE RULES
A. RULES AND PROCEDURES ADMINISTRATION

1. Review of City Council Rules and Procedures – The Council will review and revise the Handbook of Rules and Procedures as needed.

2. Adherence to Rules and Procedures – During City Council discussions, deliberations and proceedings, the Mayor bears the primary responsibility to ensure that the City Council, staff and members of the public adhere to the Council’s adopted protocol.

3. City Attorney as Rules and Procedures Advisor – With the consensus of a majority of the Council, the City Attorney may be directed to interpret the City Council’s adopted Rules and Procedures and proposed changes.

4. Applicability of Rules and Procedures – The City of Hanford City Council Handbook of Rules and Procedures shall also apply to all Commissions and/or Committees as established by the City Council.

B. CONFLICT WITH CITY MUNICIPAL CODE, ADMINISTRATION

POLICIES, STATE OR FEDERAL LAW
If there is any conflict contained hereinabove with the City Municipal Code, Administration Policies, State or Federal Law, such laws shall prevail.

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HANDBOOK OF

RULES AND

PROCEDURES

HANFORD CITY

COUNCIL

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TABLE OF CONTENTS
CHAPTER 1 – GENERAL POWERS AND DUTIES
A. The City of Hanford................................................................................1 B. Council Elections ...................................................................................1 C. Vacancies ..............................................................................................2 D. Mayor/Vice Mayor Selection..................................................................2 E. Mayor as Presiding Officer and Duties Thereto.....................................2 F. Vice Mayor .............................................................................................2 G. Compensation .......................................................................................3 H. City Manager .........................................................................................3 I. City Clerk.................................................................................................3 J. City Attorney............................................................................................4 K. Triangle of Policy, Process & Product ....................................................5 L. Municipal Code ......................................................................................5 M. Interference in Staff Functions ..............................................................5 CHAPTER 2 – CITY COUNCIL MEETINGS
A. Rules of Order .......................................................................................6 B. Regular Meetings...................................................................................6 C. Special Meetings ...................................................................................6 D. Study Sessions......................................................................................6 E. Closed Sessions ....................................................................................7 F. Emergency Meetings .............................................................................8 G. Agenda ..................................................................................................8 H. Call to Order ..........................................................................................8 I. Quorum ...................................................................................................8 J. Lack of Quorum......................................................................................8 K. Rules of Discussion ...............................................................................9

1. Motions..............................................................................................9

2. Voting ................................................................................................9

3. Abstention/Recuse: Conflict of Interest .............................................9

4. Tie Votes .........................................................................................10 L. Recognition to Speak, Council Member..............................................10

1. Interruptions ....................................................................................10

2. Public Hearings ...............................................................................10 M. Council Members’ Obligation After Absence.......................................10 N. Adjournment of Meeting ......................................................................10 O. Recess ................................................................................................11 P. Agenda Items of Order ........................................................................11 Q. Audio Recordings ................................................................................11 R. Video Recordings ................................................................................11 S. Agenda Format for Meetings ...............................................................11 T. Components of Meeting.......................................................................12

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1. Public Comments ...........................................................................12

2. Staff Communications ....................................................................12

3. Consent Calendar ..........................................................................12

4. Public Hearings ..............................................................................12

5. General Business ...........................................................................13

6. Council Reports/Comments ...........................................................13 U. Ordinances ..........................................................................................13 V. Resolutions ..........................................................................................14 W. Recognitions/Proclamations ...............................................................14 X. Minutes ................................................................................................14 Y. Appeals................................................................................................14 CHAPTER 3 - DECORUM

A. Enforcement of Decorum.....................................................................15 B. Conduct in the City Council Chambers................................................15

1. Council Chambers Defined ............................................................15

2. Council Dais ...................................................................................15

3. Rules of Decorum for the Public.....................................................15

4. Rules of Conduct and Safety..........................................................16

5. Removal from the Council Chambers ............................................16 C. Courtesy ..............................................................................................16

1. Council Members ...........................................................................16

2. Public Speakers .............................................................................16 D. Disciplining a Disruptive Member ........................................................17 E. Noise in the Lobby ...............................................................................18 F. Distribution of Literature and Other Materials
in City Council Chambers ....................................................................18 CHAPTER 4 – PROCLAMATIONS, CERTIFICATES, AND OTHER

ACCOLADES
A. Purpose ...............................................................................................19 B. Guidelines............................................................................................19 C. Policy ...................................................................................................19 CHAPTER 5 – ADMINISTRATIVE RULES
A. Rules and Procedures Administration .................................................21

1. Review of City Council Rules and Procedures...............................21

2. Adherence to Rules and Procedures .............................................21

3. City Attorney as Rules and Procedures Advisor ............................21 B. Conflict with City Municipal Code, Administration Policies, State or Federal Law ...........................................................................21

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1 CHAPTER 1

GENERAL INFORMATION, POWERS AND DUTIES
A. THE CITY OF HANFORD
The City of Hanford has a City Council/City Manager form of government.

Under this form of government, the elected City Council sets the policies for the operation of the Hanford City Government. The Council is responsible to the citizens for:
•Establishing community-wide goals that address short- and long-range needs.
•Formulating policies that define a course of action that shape city operations. •Providing quality services within available resources. •Acting as a link between the professional staff and local citizens.

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2 C. VACANCIES
Vacancies on the City Council shall be filled in accordance with California Government Code 36512.

California Government Code Section 36502 specifies the conditions under which a vacancy occurs.

Consistent with Robert’s Rules, the City Attorney shall oversee the nominations and elections of the Mayor and Vice-Mayor. Council members may nominate one or more candidates. The different names shall be repeated by the City Attorney as they are made, and then the vote is taken on each in the order in which they were nominated, until one is elected. The nominations need not be seconded. These positions typically serve a period of one (1) year.

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3 The Mayor shall preserve strict order and decorum at all times. The Mayor shall state each item coming before the City Council, and shall upon conclusion of said presentation related thereto call for the vote. Following the vote, the Mayor shall announce the results of the vote. The Mayor is eligible to vote on all motions, and shall direct the order of participation of Council Members. The Mayor shall, in all instances, have the last chance to speak. The Mayor shall sign all ordinances and resolutions adopted by the City Council during the Mayor’s presence. The Mayor shall sign all agreements and/or contracts, except where otherwise instructed or set forth by policy.

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4 The statutes of the State of California prescribe the basic functions and duties of the City Clerk, and the Government Code and Election Code provide precise and specific responsibilities and procedures to follow.

When an individual Council Member poses a question to the City Attorney, the City Attorney shall estimate the amount of time required to answer the question.

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5 Legal work involving questions or inquiries that require less than $2,500.00, per year, in billable hours by the City Attorney may be authorized by the submitting Council Member without the need of obtaining the Council’s approval.

K. TRIANGLE OF POLICY, PROCESS & PRODUCT
The City Council establishes the Policy—establishing vision and direction for the community’s future.

Other directives and policies of the City Council are recorded in resolutions or by minute action of the Council.

No member of the City Council shall publicly criticize or censure any staff member of the City, and shall instead relay any criticism of a staff member privately through the City Manager.

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6 CHAPTER 2

CITY COUNCIL MEETINGS
A. RULES OF ORDER
The City Council shall determine its own rules of order and amend them from time to time or adopt new rules as it deems necessary. The City of Hanford shall follow Rosenberg’s Rules of Order and incorporate the procedures set forth in this chapter.

The City Attorney acts as the parliamentarian and advises the Mayor when points of order are raised.

Ordinances may not be adopted at special meetings; only urgency ordinances may be adopted at such meetings. Items not listed on the agenda shall not be considered at the special meeting.

D. STUDY SESSIONS
The City Council may meet in a “study session” for the purpose of acquiring information on a particular subject(s) and collaborating with the public through individual public comment periods. These sessions are considered special meetings and shall be open to the public and comply with the Brown Act.

Additionally, as special meetings, Council may act upon an item contained in the

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7 agenda and may provide formal direction to staff consistent with the agenda wording for each item.

Government Code Section 54963 (a) – (f) outlines the injunctive relief and disciplinary actions that may be imposed on those who divulge confidential

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8 closed session discussions, without first receiving authorization from the legislative body.

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9 K. RULES OF DISCUSSION

1. Motions
Action items listed on the council agenda in accordance with applicable law or added as an action item on a council agenda, in accordance with applicable law, may be voted on by the council.

2. Voting
The City Council utilizes an electronic voting system. In the absence of an electronic voting system, the clerk shall ask for votes by “voice vote” on all matters before it, unless a roll call vote is required by law or is requested by the Mayor. Unless a Council Member states that he or she is not voting, silence shall be recorded as an affirmative vote. The Presiding Officer shall announce the results of the vote.

A majority, also known as a simple majority, is a subset of a group that is more than half of the members present.

A two-thirds majority means that two-thirds of the quorum must agree to the proposition. It is much stronger than a simple requirement. In the event of an absence the vote would have to be unanimous.

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10 It should be noted, however, a Council Member may speak as a member of the public, on his/her own behalf – as opposed to on behalf of someone else – on a matter that directly affects his/her financial interest even when conflicted out. Thus, while a Council Member would have to disqualify him/herself on a matter affecting a piece of property in which the Council Member has a financial interest, he/she could address the Council, speaking to what the impact would be to his/her property.

For example, if a matter requires three affirmative votes for approval and one Council Member abstains, at least three other Council Members must cast affirmative votes for the matter to be approved.

1. Interruptions:

2. Public Hearings:

Council Members should not speak to the merits of an issue, other than to ask questions, until the public comment has been closed.

N. ADJOURNMENT OF MEETING

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11 Regular meetings shall conclude no later than 10:00 p.m., unless the time is extended by a majority consensus of the Council.

O. RECESS
At any point during a meeting the Mayor may call for a brief recess.

S. AGENDA FORMAT FOR MEETINGS
The agenda format for the Hanford City Council will be prepared to allow for an efficient method to conduct city business. The format and order of business will be established by the City Clerk, unless modifications are approved by the City Council.

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12 T. COMPONENTS OF MEETING
The following sections of a regular meeting agenda shall set forth the guidelines of decorum for each respective section of the agenda.

The Council cannot legally discuss or take official action on citizen requests that are introduced under this section.

2. Council Reports/General Reports
Brief, information-only reports, from City Council and/or Staff may provide updates to the City Council on major events or projects that may be of public interest. This is also the time for Council members to provide committee reports and to report on any meetings attended at the City’s expense.

3. Consent Calendar
All Consent Calendar Items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made, in which event the item will be removed from the Consent Calendar to be discussed and voted upon by a separate motion.

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13 the decision is made to hold a public hearing even though one is not required by law. In this case, the agenda documents will state that the public hearing is optional. Staff will open the item by providing a report , then the Mayor will open the hearing to public comments. Public comments are subject to the rules and regulation of the Hanford Municipal Code. After closing public comments, the Mayor will allow the Council to provide questions or comments to the staff prior to making a motion.

Once public comments are closed it is inappropriate for the public to speak except to answer an inquiry of a Council Member addressed through the Mayor. However, public comments may be re-opened by a majority approval by the Council to hear new information.

5. General Business
Any other remaining items requiring action may be placed in this section.

Items that do not need action, but are to provide informational or receive direction from the City Council may also be placed under General Business.

6. 6. Items for Future Agendas
Any Council Member may request a matter which is not otherwise scheduled on a City Council agenda to be placed on a future agenda. The Council Member referring the item shall provide sufficient information as to the nature of the item. The City Council by concurrence of a majority may direct the City Manager to put the item on a future agenda.

U. ORDINANCES
Ordinances are the laws of the municipality. City councils are given the power to pass ordinances by Government Code Section 37100 as long as those ordinances are not in conflict with the laws and Constitution of the State of California or the United States. Approval of an ordinance requires a first reading or introduction and a second reading and adoption, with at least five days between readings (except an urgency ordinance). The passage of an ordinance requires the affirmative votes of at least three (3) council members. The ordinance or a summary is then published in the local newspaper and becomes effective thirty (30) days later. The thirty (30) day time frame is known as a referendum period. A referendum period is required by state law and is a time frame in which any citizen can file a petition challenging the legality of a recently adopted ordinance. An ordinance is an action that can be repealed or amended only by a subsequent ordinance.

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14 V. RESOLUTIONS
A resolution sets forth the action of the council on certain types of policy, procedural, or administrative matters. It requires only one reading and may be changed by subsequent resolution.

W. RECOGNITIONS/PROCLAMATIONS
The City Council may recognize individuals, organizations, or activities during the meetings. Other organizations may also present recognitions to the City.

The City Clerk shall prepare the Minutes, and upon approval of the City Council, it shall become the official record.

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15 CHAPTER 3

B. CONDUCT IN THE CITY COUNCIL CHAMBERS

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16 be subject to ejection from the meeting per Government Code Section 54954.3(c).

5. Rules of Conduct and Safety
When the City Council is in session, all persons present must preserve safety and order. Members of the public should sit in the seats provided, subject to ADA compliance, unless addressing the Council or entering or leaving the Council Chambers. Members of the public shall not block the aisles or exits in any manner. Members of the public should not bring audible equipment into the Council Chambers, including cellular phones or pagers, without first either turning said equipment off or to a silent mode.

6. Removal from the Council Chambers
Any person who commits the following acts in respect to a meeting of the City shall be removed from the Council Chambers per Government Code Section 54957.9.
(a) Disorderly, contemptuous or insolent behavior toward the City or any member thereof, tending to interrupt the due and orderly course of said meeting; and,
(b) A breach of the peace, boisterous conduct or violent disturbance, tending to interrupt the due and orderly course of said meeting; and,
(c) Disobedience of any lawful order of the Mayor, which shall include an order to be seated or to refrain from addressing the City Council; and,
(d) Any other unlawful interference with the due and orderly course of said meeting.

C. COURTESY

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17 While the City Council meeting is in session, all persons must preserve order and decorum. A person who addresses the City Council under a specific agenda item or under Public Comments may not engage in speech or conduct which is likely to provoke others to violent or riotous behavior, which disturbs the peace of the meeting by loud and unreasonable noise, which is outside of the Council’s jurisdiction, repetitive, or which disrupts, disturbs, or otherwise impedes the orderly conduct of any City Council meeting.

In some instances meeting one-on-one outside of a public meeting can rectify a misunderstanding or correct inappropriate behavior. The manner in which a situation is addressed may be on a case by case basis. If the behavior continues

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18 or if the actions are more severe, the City Council may determine other methods of discipline.

E. NOISE IN THE LOBBY
Noise emanating from the lobby outside the City Council Chambers which disrupts City Council meetings shall not be permitted.

F. DISTRIBUTION OF LITERATURE AND OTHER MATERIALS IN CITY

COUNCIL CHAMBERS
No person, other than city staff, shall distribute flyers, leaflets, placards or other literature or circulate any petition within the City Council Chambers.

Hand-held signs are permitted in the Council Chambers, but they cannot block the view of others in the audience or prevent the public from freely entering or exiting the room.

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19 CHAPTER 4

PROCLAMATIONS, CERTIFICATES, AND OTHER ACCOLADES
A. PURPOSE
The purpose of this policy is to establish uniform procedures, criteria, and identify authority.

B. GUIDELINES
The following are basic guidelines for recognition.

They contain several biographical or informational paragraphs. Examples include Fire Prevention Week, Arbor Day, and American Red Cross Month.

Certificates – Certificates are prepared in response to the type of recognition desired and are to express appreciation for exemplary service or performance to individuals, teams, or organizations.

1.Request for proclamations, certificates or plaques from City Council Members, city departments, residents, and local organizations must be submitted to the City Clerk’s office.

2.Requests should specify:
(a) Reason why recognition should be granted; and
(b) Information that will assist the Mayor, City Council, or City Manager in arriving at a decision.

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20 it will be presented at a City Council meeting or will direct the City Clerk to forward the accolade to the recipient.

4.All requests for plaques, framed certificates, or custom gifts to visiting officials/dignitaries, elected officials, individuals or organizations shall be approved by the Mayor and City Manager.

5.Individual Council Members shall have the discretion to direct the City Clerk to prepare certificates (not framed) or another token of appreciation that he or she will personally present.

6.Requests for plaques, gifts or awards to city employees for dedicated service to the city shall be approved by the City Manager.

7.The Mayor and City Manager shall have the discretion to determine the appropriate type of honor for special or unusual circumstances that may arise and may warrant deviation from this policy.

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21 CHAPTER 6

ADMINISTRATIVE RULES
A. RULES AND PROCEDURES ADMINISTRATION

1. Review of City Council Rules and Procedures – The Council will review and revise the Handbook of Rules and Procedures as needed.

4. B. CONFLICT WITH CITY MUNICIPAL CODE, ADMINISTRATION

POLICIES, STATE OR FEDERAL LAW
If there is any conflict contained hereinabove with the City Municipal Code, Administration Policies, State or Federal Law, such laws shall prevail.

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13.F.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Approval of Amendment No. 3 of the License Agreement between the Carnegie Museum of Kings County and the City of Hanford to extend the term of the agreement until December 31, 2024.

RECOMMENDATION:

Recommendation: That the City Council, by motion, approve Amendment No. 3 of the License Agreement between the Carnegie Museum of Kings County and the City of Hanford to extend the term of the agreement until December 31, 2024
BACKGROUND:

The Carnegie Museum of Kings County (CMKC) has occupied the City's Carnegie building since June of 2021 and has made significant improvements to the property and hosted several different exhibits. By all measures of success, CMKC has done a great job of developing their museum and building a reputation of offering items and exhibits that are of value to the citizens of Hanford. As the City and CMKC continue to work towards a long term lease or the possible sale of the property located at 109 E. Eighth Street, both parties agree that it is of mutual interest to extend the term of the current Agreement.

The major points of the current Agreement are as follows:
• Term: CMKC may occupy the property during the period January 1, 2024 through December 31, 2024.
• License Fee: CMKC will pay ten dollars ($10.00) to the City for the right to occupy the property.
• City Repair Responsibilities: The City will cover up to five thousand dollars ($5,000.00) in maintenance and repair work.
• Day-To-Day Maintenance: CMKC will be responsible for the day-to-day maintenance of the property, and CMKC will be allowed to paint the interior walls and ceilings of the former library building and make any other upgrades with the consent of the City Manager.

FISCAL IMPACT:

The maximum financial responsibility to the City for the term of the amendment is $5,000.

ATTACHMENTS:

1. Lic Agreement Amendment No 3

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13.G.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Approval of the Notice of Completion of the FY 23 Double Fiberized Micro Surface Treatment Project, for a total contract price of $484,753.00, by Pavement Coatings Company, and authorization for the Mayor to execute and the City Clerk to attest and file said Notice with Kings County Recorder’s Office.

RECOMMENDATION:

Recommendation: That the City Council, by motion, approve the Notice of Completion for the FY 23 Double Fiberized Micro Surface Treatment Project, for a total contract price of $484,753.00, and authorize the Mayor to execute and the City Clerk to attest and file said Notice with Kings County Recorder’s Office.

BACKGROUND:

On April 4, 2023, Council authorized Permission to Advertise along with authorization to pre-award the FY23 Double Fiberized Micro Surface Treatment Project to the qualified low bidder, Pavement Coatings Company of Sacramento, CA, whose bid came in under the project budgeted amount. The project consisted of installing a Double Fiberized Micro Surface Pavement Treatment on 11th Avenue between Fargo Avenue and Flint Avenue, and Hanford Armona Road between 11th Avenue and 12th Avenue.

There were (2) contract change orders on this project, which included Extended project limits on 11th Ave from Furlong Ave to Flint Ave, for a net increase of $29,700.00 and Balance of Quantities for a net increase of $3,553.00.

FISCAL IMPACT:

The FY23 Capital Improvement Budget provides $935,000.00 for the FY23 Double Fiberized Micro Surface Treatment Project, including contingencies.

The total cost to complete the project was $484,753.00. Attached are the Final Project Construction and Finance History for Council review.

ATTACHMENTS:

1. NOC report - FY23 Fiber

2. NOC - Recording Original - FY23 Fiber

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FINAL PROJECT CONSTRUCTION AND FINANCE HISTORY

PROJECT:

FY 23 Double Fiberized Micro Surface Treatment Project

CONTRACTOR: Pavement Coatings
2150 Bell Avenue, Suite 125
Sacramento, CA 95838

CONTRACT DATES: Bid Date May 16, 2023
Council Award May 16, 2023
(Preauthorized Award based on bids under budget. )
Contractor Started Work July 11, 2023
Contract Time of Completion August 10, 2023
Contractor Completed Work July 25, 2023

CONTRACT CHANGE ORDERS:

Change Order No. 1 – Extended project limits on 11th Ave from Furlong Ave to Flint Ave For a net increas e of $29,700.00.

Change Order No. 2 – Balance of Quantities for a net increase of $3,553.00.

FINANCIAL HISTORY:

SOURCE OF BUDGET FUNDING
AMOUNT

FY23 Capital Improvements Program Budget $ 935,000.00 (Total Budget Funding for FY 23 Manhole and Valve Cover Adjustment Project and FY 23 Double Fiberized Micro Surface Treatment Project)

FY 23 Manhole and Valve Cover Adjustment Project -$ 189,964.95 (Notice of Completion Approved 10/17/2023)
Fund Balance $ 745,035.05

CONSTRUCTION COSTS
Contract – Total Bid Award $ 451, 500.00
CCO #1 $ 29,700.00
CCO #2 $ 3,553.00

Total Construction Cost $ 484,753.00

Fund Balance $ 260,282.05

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RECORDING REQUESTED BY:

CITY OF HANFORD

When recorded return to:

City Clerk
City of Hanford
315 North Douty Street
Hanford, California 93230-3951

G.C. 27361.3 - Fee NIL

NOTICE OF COMPLETION

TO WHOM IT MAY CONCERN:

YOU ARE HEREBY NOTIFIED AS FOLLOWS:

1. The work of Improvement is located at: Within City Right-of-way on 11 th Avenue from Fargo Avenue to Flint Avenue, and Hanford Armona Road from 11 th Avenue to 12 th Avenue, in Hanford CA.

2. The Improvement is particularly described as: FY Double Fiberized Micro Surface Pavement Treatment Project

3. The date of completion of the work of Improvement: July 25, 2023.

4. The Owner of the work of Improvement: City of Hanford.

5. The nature of the owner’s interest or estate: Fee Simple Title.

6. The name of the original contractor for the work of Improvement: Pavement Coatings Company.

7. The surety for the work of Improvement: The Ohio Casualty Insurance Company

8. All work for this project has been completed.

9. Accepted by minute action of the City Council of the City of Hanford on: November 7, 2023

I certify under penalty of perjury that the forego ing is true and correct.

Dated this 7
th day of November, 2023.

BY: ________________________________________
Travis Paden, Mayor
City of Hanford, County of Kings, State of Ca lifornia

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I, the undersigned, say:

I am the person who signed the foregoing notice. I have read the above notice and know its contents, and the facts stated therein are true of my own knowledge.

I declare under penalty of perjury that the foregoing is true and correct.

Executed at Hanford, California, this ____ day of ___________, 2023.

BY: ________________________________________
Travis Paden, Mayor
City of Hanford, County of Kings, State of C alifornia

Authority: Section 1181 Civil Code

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13.H.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Approval of a contract with Janitorial Inc. at the rate of $42,036 for the remainder of 2023 and $43,176 for 2024 to provide janitorial services at the Police Department buildings.

RECOMMENDATION:

Recommendation: That the City Council, by motion, approve an annual contract with Janitorial Inc for cleaning services at the Hanford Police Department at the rate of $42,036 for the remainder of 2023 and $43,176 for 2024.

BACKGROUND:

The previous contract for cleaning services for the Hanford Police Department was terminated on September 22, 2023. The cost of the previous contract was $4,600 per month ($55,200 annually).

Five quotes for service were obtained as follows:

G&B Janitorial- $6450 monthly / $77,400 annually
Grime Fighters Cleaning- $5250 monthly / $63,000 annually Daval Building Maintenance- $4550 monthly/ $54,600 annually Tri-County Janitorial- $3641 monthly / $43,692 annually Janitorial Inc- $3503 monthly (2023) & $3598 monthly (2024) / $42,036 annually (2023) & $43,176 annually (2024)

In addition to being the lowest price quote for service, Janitorial Inc offers the department 20 additional hours of deep cleaning per year, which can be used for windows, carpet cleaning, or other cleaning as needed. This company currently services the Fresno Police Department and Public Utilities building, Superior Courts of Fresno and Merced County, and the Fresno County Department of Social Services and Office of Education. Service provided by Janitorial Inc, would begin on November 10, 2023.

FISCAL IMPACT:

The contract would result in savings to the City of $13,164 in 2023 and $12,024 in 2024 over the cost of the previous contractor.

ATTACHMENTS:

1. Janitorial Inc Contract

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13.I.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: CONSENT CALENDAR

SUBJECT:

Authorization to accept the Homeland Security Grant from the County of Kings in the amount of $55,448, and an amendment to the Police Department's operating budget to recognize the grant, appropriation of $55,448 in the General Fund for the Police Department, and authorization for the City Manager to execute the grant agreement.

RECOMMENDATION:

Recommendation: Authorization to accept the Homeland Security Grant from the County of Kings in the amount of $55,448, and an amendment to the Police Department's operating budget to recognize $55,448 in grant funds, appropriate $55,448 in the General Fund for the Police Department, and authorize the City Manager to execute the grant agreement.

Recommended Motion:

I move to authorize the acceptance of a grant and amend the Police Department's operating budget to recognize the grant funds and to appropriate the same amount in the General Fund and authorize the City Manager to execute the grant agreement.

BACKGROUND:

The Hanford Police Department sought the The Homeland Security Grant through the County of Kings. The department submitted a project proposal for funds to be able to replace portable radios.

The portable radios that the department currently has are outdated. With new portable radios, the officers will not have any issues communicating with each other. These grant funds will allow the department to purchase twenty-seven (27) new encrypted portable radios for the department.

There are no matching funds associated to this grant. An appropriation for the amount of the grant ($55,448) will be made to expend the funds. There may be minor expenditures that will have to occur in excess of the grant amount as the grant administrator wants the agency to expend all of the funds and it is not possible to expend the exact amount. We will strive to get as close as possible to the actual grant amount and minimize the impact of the department's original operating budget. Any amount in excess would be absorbed within the existing Police Department budget.

FISCAL IMPACT:

The fiscal impact will be a total of $55,448 of grant monies to the City. If approved, a budget amendment to recognize the grant funds and an appropriation of funds in the amount of $55,448 to the General Fund for the Police Department will be made. The City will be reimbursed once the project is completed by the grant administrator.

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ATTACHMENTS:

1. Agreement

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14.A.

AGENDA

STAFF REPORT

MEETING DATE: 11/7/2023 AGENDA SECTION: GENERAL BUSINESS

SUBJECT:

Presentation from Lechowicz & Tseng Municipal Consultants on the Rate Study for water, wastewater and storm drain rates and Council direction to staff and consultants to commence with the Proposition 218 process and set the Hearing Date & Time for January 16, 2024 at 7pm for the proposed rate increases.

RECOMMENDATION:

Recommendation: That City Council receive a presentation from Lechowicz & Tseng Municipal Consultants on the Rate Study for water, wastewater and storm drain rates and provide direction to staff and consultants to begin the Proposition 218 process and set the date of the required public hearing for January 16, 2024.

Recommended Motion: Authorize staff and consultants to begin the Proposition 218 process.

BACKGROUND:

Utility operations in water, sewer and storm drain are self-supporting enterprise funds that provide services for a fee. Charges for service through rates are the primary source of funding for operations and also fund a significant portion of the capital improvement program which includes the debt service (principal and interest) for bonds issued to fund these projects. Developer fees are the other funding source for capital projects. However, impact fees paid by developers are legally limited to addressing the impacts caused by the impacts of the developers' projects. For example, a project's impact fees may not be utilized to address normal wear and tear to infrastructure improvements that are not caused by that project.

It has been five years since water rate adjustments. The last water rate increase was July 1, 2018 (adopted in Resolution No. 15-60-R on December 15, 2015). The last sewer/storm rate increase was July 1, 2011 (adopted in Resolution No. 09-77-R on November 17, 2009) over twelve years ago.

Without updating rates the City will not have long term sustainability.

City Council has the authority to approve rate changes when necessary to ensure the continued recovery of costs for services and to secure reinvestment into the system infrastructure for long term sustainability.

Proposition 218 (Prop 218), approved in 1996, adds Article XIII D (Voter Approval for Local Tax Levies) to the California Constitution. All property-related fees, such as water, wastewater and storm drain fees and charges, must meet Prop 218’s requirements. It applies to most utility charges and fees; however, electric and gas utility charges were specifically exempted from the definition of

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property-related charges in the statute. The City is required to provide notice of proposed increases to the sewer, water and refuse collection service fees and charges to all affected ratepayers and record receipt of all written protests during a public hearing. Prop 218 prohibits increases to fees and charges if a majority of the affected ratepayers submit written opposition to proposed increases. Per Government Code Sections 53750 and 53751, the California Legislature has determined that, for purposes of Proposition 218, "sewer" includes sanitary sewer and storm water collection and disposal systems. As a result, increases to storm water fees are subject to Proposition 218's "majority protest" rules and do not require voter approval. Any new rates (if warranted) are recommended to be in place by February 1, 2024.

The City's utilities are faced with many current and future challenges including aging infrastructure, preserving groundwater supply, adapting to changing water and wastewater quality regulations, and increased operational and capital costs. A growing proportion of Hanford's utility infrastructure is aging beyond its expected useful life. For example, the expected useful life of water distribution pipeline is 40 years. Hanford's operational costs are not immune to the impacts of inflation, which increase construction and equipment costs as well. In addition, adequate fund balance must be maintained to maintain applicable bond requirements and sustain operations in event of a fiscal emergency.

The consultant Lechowicz & Tseng and staff provided Council with a preliminary look at the needs of the water and sewer enterprises at the September 19, 2023 City Council Meeting. After receiving Council direction at the September 19, 2023 City Council Meeting, staff and the consultant reviewed and modified the study, addressed issues raised by Council and the City Attorney and are providing Council with an updated version of the study that establishes the rates to be proposed as part of the Proposition 218 process.

FISCAL IMPACT:

Based on Council direction today, staff and the consultant could begin the Proposition 218 process including public notices of a rate change effective as of February 2024.

The proposed five-year water utility rate plan will fund future operating and capital costs, maintain reserve levels and financial metrics that comply with approved fiscal and reserve policies, and maintain current bond ratings to keep current and potential borrowing costs for capital investments low.

ATTACHMENTS:

1. Rate Report Final 11.1.23

2. Prop 218 Notice L&T DRAFT 11.7.23

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CITY OF HANFORD

Water, Wastewater, and Stormwater
Utility Rate Study 2023

DRAFT REPORT
November 2023

909 Marina Village Parkway #135 Alameda, CA 94501 (510) 545-3182 www.LTmuniconsultants.com

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City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023

TABLE OF CONTENTS

Section 1: INTRODUCTION ......................................................................................................................... 1

1.1 Background ................................................................................................................................... 1

1.2 Requirements of Proposition 218 ................................................................................................. 1

1.3 Rate Study Process ........................................................................................................................ 2

1.4 Summary of Proposed Rates ......................................................................................................... 4 Section 2: CURRENT RATES AND CUSTOMER BASE ................................................................................. 10

2.1 Current Water Rates ................................................................................................................... 10

2.2 Water Customer Base and Current Water Sales Revenues ........................................................ 11

2.3 Current Wastewater Rates.......................................................................................................... 13

2.4 Wastewater Customer Base and Current Revenues ................................................................... 14

2.5 Current Storm Drainage Rates and Revenues ............................................................................ 16 Section 3: WATER REVENUE REQUIREMENT ........................................................................................... 17

3.1 Water System Overview ............................................................................................................. 17

3.2 Water Reserves ........................................................................................................................... 17

3.3 Water Capital Improvement Plan ............................................................................................... 18

3.4 Water Cash Flow Projection ........................................................................................................ 18 Section 4: WATER COST ALLOCATION AND RATE DESIGN ....................................................................... 22

4.1 Water Cost Allocation ................................................................................................................. 22

4.2 Billing Units ................................................................................................................................. 24

4.3 Water Rate Design ...................................................................................................................... 26

4.4 Water Rate Derivation ................................................................................................................ 27

4.5 Water Bill Impacts ....................................................................................................................... 32 Section 5: WASTEWATER REVENUE REQUIREMENT................................................................................ 35

5.1 Wastewater System Overview .................................................................................................... 35

5.2 Wastewater Reserves ................................................................................................................. 35

5.3 Wastewater Capital Improvement Plan ...................................................................................... 35

5.4 Wastewater Cash Flow Projection .............................................................................................. 36 Section 6: WASTEWATER COST ALLOCATION AND RATE DESIGN ........................................................... 41

6.1 Wastewater Cost Allocation ....................................................................................................... 41

6.2 Wastewater Rate Design ............................................................................................................. 42

6.3 Wastewater Flows....................................................................................................................... 43

6.4 Wastewater Rate Derivation ....................................................................................................... 44

6.5 Wastewater Bill Impacts ............................................................................................................. 46 Section 7: STORM DRAINAGE REVENUE REQUIREMENT ......................................................................... 51

7.1 Storm Drainage System Overview .............................................................................................. 51

7.2 Storm Drainage Reserves ............................................................................................................ 51

7.3 Storm Drainage Capital Improvement Plan ................................................................................ 51

7.4 Storm Drainage Cash Flow Projection......................................................................................... 52

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City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023

Section 8: STORM COST ALLOCATION AND RATE DESIGN ....................................................................... 55

8.1 Storm Drainage Cost Allocation .................................................................................................. 55

8.2 Storm Drainage Fee Design ......................................................................................................... 57

8.3 Cost Allocation Results ................................................................................................................ 59

8.4 Proposed Storm Drainage Rates ................................................................................................. 60

8.5 Storm Drainage Survey ............................................................................................................... 60

8.6 Annual Parcel Database Review .................................................................................................. 61

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City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023

LIST OF TABLES

Table 1: Proposed Monthly Water Rates ...................................................................................................... 5 Table 2: Proposed Wastewater Rates ........................................................................................................... 6 Table 3: Proposed Monthly Storm Drainage Fees ........................................................................................ 7 Table 4: Current Monthly Water Rates ....................................................................................................... 11 Table 5: Estimated Water Service Sales Revenues from Billing Data, FY 2022/23 ..................................... 12 Table 6: Current Wastewater Rates ............................................................................................................ 14 Table 7: Estimated Wastewater Service Charge Revenues from Billing Data, FY 2022/23 ........................ 15 Table 8: Current Storm Drainage Rates ...................................................................................................... 16 Table 9: Water Capital Improvement Plan (rate funded) ........................................................................... 18 Table 10: Water Cash Flow Projection ........................................................................................................ 21 Table 11: Water Cost Allocation ................................................................................................................. 23 Table 12: Annual Revenue Requirement Allocation ................................................................................... 24 Table 13: Number of Meter Equivalents (Total Inside & Outside City Accounts)....................................... 25 Table 14: Projected Customer Growth & Water Consumption .................................................................. 26 Table 15: Water Fixed Charge Derivation ................................................................................................... 28 Table 16: Consumption Charge Rate Derivation ......................................................................................... 29 Table 17: Consumption Charge Rate Derivation - Drought Rates .............................................................. 30 Table 18: Proposed Monthly Water Rates .................................................................................................. 31 Table 19: Sample Monthly Residential Water Bill Impacts ......................................................................... 32 Table 20: Wastewater Capital Improvement Plan (rate funded) ............................................................... 36 Table 21: Wastewater Cash Flow Projection .............................................................................................. 39 Table 22: Wastewater Cost Allocation ........................................................................................................ 42 Table 23: Annual Sewer Flows & Loadings ................................................................................................. 43 Table 24: Unit Cost Calculation ................................................................................................................... 44 Table 25: Sewer Rate Calculation ............................................................................................................... 45 Table 26: Proposed Wastewater Rates ....................................................................................................... 46 Table 27: Proposed Wastewater Rate Increases ........................................................................................ 47 Table 28: Sample Monthly Non-Residential/Commercial Sewer Bill Impacts ............................................ 49 Table 29: Storm Drainage Capital Improvement Program (CIP) ................................................................. 52 Table 30: Storm Drainage Cash Flow Projection ......................................................................................... 54 Table 31: Estimated of Acreage & Impervious Area ................................................................................... 57 Table 32: Storm Drainage Fee Calculation .................................................................................................. 58 Table 33: Proposed Storm Drainage Fees ................................................................................................... 60

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City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023

LIST OF FIGURES

Figure 1: Comprehensive Cost of Service Study Process .............................................................................. 3 Figure 2: Single Family Residential Monthly Water, Sewer, and Storm Average Bill ................................... 8 Figure 3: Single Family Residential Monthly Water, Sewer, and Refuse Bill Survey .................................... 9 Figure 4: Water Cash Flows ......................................................................................................................... 20 Figure 5: Monthly Single Family Residential Water Bill Survey .................................................................. 33 Figure 6: Fixed Monthly Meter Charge Survey ........................................................................................... 34 Figure 7: Wastewater Cash Flows ............................................................................................................... 38 Figure 8: Monthly Single Family Residential Wastewater Bill Survey ......................................................... 48 Figure 9: Commercial Monthly Wastewater Bill Surveys by Strength Category ........................................ 50 Figure 10: Storm Drainage Cash Flows ....................................................................................................... 53 Figure 11: Current vs. Proposed Storm Drainage Revenue Recovery ........................................................ 59 Figure 12: Storm Drainage Residential Monthly Bill Survey ....................................................................... 61

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City of Hanford Page 1 Water, Wastewater, and Stormwater Utility Rate Study 2023

SECTION 1: INTRODUCTION

1.1 Background
The City of Hanford (City) is located in the southern portion of the San Joaquin Valley and is the county seat of Kings County, California. The City was incorporated in 1891. The City provides water, wastewater, and storm drainage service to a population of over 56,000 residents in addition to businesses and industrial facilities. The water, wastewater, and storm drainage enterprise funds are self-supported from rates and charges and fund the operations and capital project budgets of the Utilities and Wastewater branches of the Public Works Department.

The City Council approved the last formal rate studies in 2015 for the water utility and 2009 for the wastewater and storm drainage utilities. Water rates were last increased July 1, 2018, and wastewater and storm drainage rates were last increased July 1, 2011. Since then, the City has experienced a number of unanticipated changes necessitating a rate reevaluation including COVID-19, economic inflation, and water supply issues as well as the development of new Master Plans for all three utilities.

The City engaged Lechowicz & Tseng Municipal Consultants (L&T) to complete a comprehensive water, wastewater (sewer), and storm drainage (storm) rate study to recommend utility rates that will generate sufficient revenues to recover the full cost of services and ensure the continued financial health of the City’s enterprise funds. This rate study covers the five-year period beginning in Fiscal Year (FY) 2023/24 through 2027/28.

1.2 Requirements of Proposition 218
The implementation of utility rates in California is governed by the substantive and procedural requirements of Proposition 218 the “Right to Vote on Taxes Act” which is codified as Articles XIIIC and XIIID of the California Constitution. The City must follow the procedural requirements of Proposition 218 for all utility rate increases. These requirements include:

1. Noticing Requirement – The City must mail a notice of the proposed rate increases to all affected property owners or ratepayers. The notice must specify the amount of the fee, the basis upon which it was calculated, 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 property owners or ratepayers submit written protests against the proposed rate increases, the increases cannot be adopted.

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Proposition 218 also established substantive requirements that apply to water, wastewater, and storm rates and charges, including:

1. Cost of Service – Revenues derived from the fee or charge cannot exceed the funds required to provide the service. In essence, fees cannot exceed the “cost of service”.

2. Intended Purpose – Revenues derived from the fee or charge can only be used for the purpose for which the fee was imposed.

3. Proportional Cost Recovery – The amount of the fee or charge levied on any customer shall not exceed the proportional cost of service attributable to that customer.

4. Availability of Service – No fee or charge may be imposed for a service unless that service is used by, or immediately available to, the owner of the property.

5. General Government Services – No fee or charge may be imposed for general governmental services where the service is available to the public at large.

Charges for water, wastewater, and storm service are exempt from additional voting requirements of Proposition 218, provided the charges do not exceed the cost of providing service and are adopted pursuant to the procedural requirements of Proposition 218. In 2017, the State passed Senate Bill 231 clarifying the definition of “sewer” in Proposition 218 to include both sanitary and storm sewer, and thereby exempting storm drain rates from the additional ballot requirement.

1.3 Rate Study Process
This section details the development of the City’s water, wastewater, and storm rates via the Proposition 218 process as shown in the following figure.

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City of Hanford Page 3 Water, Wastewater, and Stormwater Utility Rate Study 2023

Figure 1: Comprehensive Cost of Service Study Process

The following is a brief description of the rate study process:

 Revenue Requirements - Revenue requirements are analyzed via financial plans developed from the Water, Wastewater, and Storm Drain Fund budgets. Based on the best information currently available, the financial plans incorporate projected operation and maintenance costs, capital expenditures, debt service, and growth to estimate annual revenue requirements. The plans serve as a roadmap for funding the City’s future operating and capital programs while maintaining long-term fiscal stability.

 Cost of Service Allocation - The cost of service process builds on the financial plan analysis and assigns water and sewer system costs to functional cost components: metering and customer service, base, and extra for water, and customer service, flow, BOD, and SS for sewer. Storm drain service costs are allocated to customers based on parcel size and impervious (paved) area.1

1 Single family residential (SFR) parcels are proposed to be charged based on average SFR parcel size within the City

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 Rate Design - Rate design involves developing a rate structure that proportionately recovers costs from customers. Final rate recommendations are designed to (a) fund the utilities’ short- and long-term costs of providing service; (b) proportionately allocate costs to all customers and customer classes; and (c) comply with the substantive requirements of Proposition 218.

1.4 Summary of Proposed Rates
The proposed water, wastewater, and storm drain rates were developed to fairly recover costs, adhere to California statute, and be affordable to customers. The rates developed were based on the best available information gathered from City budgets, audits, and input from staff and City Council. The cost allocations proposed herein are based on American Water Works Association methodologies and industry standard practice. The proposed rates are based on the reasonable cost of providing service and are proportional to the benefits received by each customer.

Current and proposed monthly water rates are provided in Table 1. As an update to the current rates, it is proposed that customers be billed the same rates regardless of whether their property is inside the City limits. The projected water rates also include a schedule of drought rates, which would only be implemented during a water shortage emergency.

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City of Hanford Page 5 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 1: Proposed Monthly Water Rates City of Hanford Utility Rate Study
Current
Rates [1]

PROPOSED
Fiscal Year FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2018 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027

METER CHARGES
5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 1-1/2" & 2" $21.88 $31.89 $36.34 $39.62 $41.23 $42.91 3" & 4" $34.83 $95.56 $108.90 $118.73 $123.55 $128.58 6" $54.26 $292.35 $333.16 $363.26 $378.01 $393.37
8" $80.17 $465.99 $531.04 $579.02 $602.53 $627.01
CONSUMPTION CHARGES ($/CCF)
All Customers $1.34 $1.94 $2.24 $2.44 $2.54 $2.64

DROUGHT CONSUMPTION CHARGES ($/CCF) [2]
10% Water Cutback $2.10 $2.42 $2.64 $2.75 $2.86
20% Water Cutback $2.30 $2.65 $2.89 $3.01 $3.13
35% Water Cutback $2.72 $3.13 $3.41 $3.55 $3.69
50% Water Cutback $3.38 $3.89 $4.24 $4.41 $4.59

CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 1 - Current rates shown are for Inside City customers. Inside & Outside City customers are proposed to be billed the same rates going forward. Current meter charges shown are the sum of the service connection charge and the meter fee.
2 - Only to be implemented temporarily during water shortage emergencies.

Current and proposed monthly wastewater rates are provided in Table 2. The proposed monthly storm rates are provided in Table 3. Currently, wastewater and stormwater rates are billed together as a single charge. Of the existing wastewater system charges adopted in the City’s Resolution No. 09-77-R, 78.0% of the service charges for each customer are allocated to the wastewater system, and the remaining

22.0% are allocated to the stormwater system. It is recommended that the City levy storm drain charges based on land use type and parcel size to better reflect the proportional cost of service provided to each customers. Single family residential customers are proposed to be billed a fixed fee based on the average parcel size while all other customer types will be charged an individual rate based on their parcel’s acreage. Parcels with indeterminate acreage will be billed a minimum charge according to their customer class.

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Table 2: Proposed Wastewater Rates City of Hanford
Utility Rate Study

Current PROPOSED
Customer Class Rates FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2011 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027

RESIDENTIAL (Per dwelling unit)
Single Family $17.86 $24.67 $27.63 $30.95 $32.50 $34.13 Multi-Family/Duplex $16.93 $18.51 $20.73 $23.22 $24.38 $25.60

NON-RESIDENTIAL
Metered Water ($/CCF) [1]
Group A: Domestic $1.54 $3.08 $3.45 $3.86 $4.05 $4.25 Group B: Low Strength $1.44 $2.81 $3.15 $3.53 $3.71 $3.90 Group C: Medium Strength $2.15 $3.95 $4.42 $4.95 $5.20 $5.46 Group D: High Strength $2.88 $5.34 $5.98 $6.70 $7.04 $7.39

Schools (per student ADA) [2] $0.51 $0.74 $0.83 $0.93 $0.98 $1.03 Septage (per 1,000 gallons) $26.19 $35.03 $39.23 $43.94 $46.14 $48.45 Industrial
Flow (per mg) $1,561.56 $2,497.17 $2,796.83 $3,132.45 $3,289.07 $3,453.52 BOD (per lb) $0.173 $0.557 $0.623 $0.698 $0.733 $0.770 SS (per lb) $0.167 $0.558 $0.625 $0.700 $0.735 $0.772 CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons; Mg – million gallons; BOD – biological oxygen demand; SS – suspended solids
1 - Per hundred cubic feet (ccf) 2 - ADA - average daily attendance

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City of Hanford Page 7 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 3: Proposed Monthly Storm Drainage Fees
City of Hanford
Utility Rate Study
Current PROPOSED
Rates FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2011 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027

SINGLE FAMILY RESIDENTIAL $5.04 $4.57 $4.79 $5.03 $5.29 $5.55 (per account)

ALL OTHER CUSTOMERS (per acre)
Business

$43.25 $45.42 $47.69 $50.07 $52.57
Industrial $38.45 $40.37 $42.39 $44.51 $46.73
Low Density $4.81 $5.05 $5.30 $5.56 $5.84
Multi-Family $28.84 $30.28 $31.79 $33.38 $35.05
Public Agency $43.25 $45.42 $47.69 $50.07 $52.57
Schools $7.21 $7.57 $7.95 $8.35 $8.76

BASE CHARGE (per account) [1]
Business

$8.65 $9.08 $9.54 $10.01 $10.51
Industrial $7.69 $8.07 $8.48 $8.90 $9.35
Low Density $0.96 $1.01 $1.06 $1.11 $1.17
Multi-Family $5.77 $6.06 $6.36 $6.68 $7.01
Public Agency $8.65 $9.08 $9.54 $10.01 $10.51
Schools $1.44 $1.51 $1.59 $1.67 $1.75

1 - Charge for storm drain accounts that the City does not currently have parcel size for

For all three utilities, the first rate change is proposed to go into effect February 1, 2024 with subsequent rate effective each July 1 beginning in 2024 through 2027. The typical monthly water use of a single family customer is 16 ccf per month. Based on these parameters, the City’s current total combined water, wastewater, and storm drain bill for a typical single family home with a 5/8” meter is $59.75 per month. After the proposed increase, the typical combined residential bill would increase to $77.70 per month on February 1, 2024, an increase of about 30%, see Figure 2.

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Figure 2: Single Family Residential Monthly Water, Sewer, and Storm Average Bill

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It should be noted that each customer’s monthly utility bill also includes service charges for other utility services including refuse and street sweeping. The charges for other utility services are not evaluated as part of this study. A survey was conducted comparing the combined monthly utility bill for City of Hanford residents with those of other local cities. Because not all cities charge monthly rates for storm drainage and street sweeping services, only water, wastewater, and refuse charges were included in the comparison, see Figure 3. The City’s current and proposed combined monthly bills fall within the lower to mid-range of those charged by surrounding cities.

Figure 3: Single Family Residential Monthly Water, Sewer, and Refuse Bill Survey

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SECTION 2: CURRENT RATES AND CUSTOMER BASE
This section provides an overview of the City of Hanford’s current water, wastewater, and storm drainage rates, customer base, water usage statistics, and current rate revenues.

2.1 Current Water Rates
The City bills customers for water service on a monthly basis. The last water rate study was conducted in 2015 which provided a schedule of water rate increases through 2018. A schedule of current monthly water rates that went into effect on July 1, 2018 is provided in Table 4. Current rates vary based on whether each customer is located inside or outside the City limits. There is a 10% surcharge for customers outside the City limits. Prior to the last water rate study, some City customers were unmetered and billed according to a schedule of flat rates for water service. Since then, all customers have been transitioned to metered service. Thus, the City’s existing schedule of water rates for flat rate connections is not evaluated as part of this study. The City’s current water rate structure for metered service connections includes three components: (1) a Connection Charge, (2) a Meter Size Charge, and (3) a Water Consumption Charge.

2.1.1 Connection Charge
All customers are charged a connection charge which is standard across all customer classes and meter sizes. The connection charge is charged independent of water consumption.

2.1.2 Meter Size Charge
All customers are charged a meter size charge based on their meter size which is levied regardless of water consumption and recognizes that even when a customer does not use any water, the City incurs fixed costs associated with maintaining the ability or readiness to serve each connection. Together with the connection charge, the meter size charge makes up the fixed portion of each customer's monthly bill.

2.1.3 Water Consumption Charge
In addition to the fixed charges, all customers pay a water consumption charge per hundred feet (ccf) of water consumption. One ccf is equal to 748 gallons of water. The charges for all customers are the same regardless of customer class.

2.1.4 Private Fire Protection Service
The City also levies a flat charge to three customers that have a separate meter for fire sprinklers. The private fire protection service charges are not evaluated as part of this study.

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City of Hanford Page 11 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 4: Current Monthly Water Rates
City of Hanford
Utility Study
Connection Charge Inside City
Limits
Outside
City Limits
All Service Connections $2.46 $2.71
Meter Size Charge
5/8", 3/4", & 1" meter $12.95 $14.25
1-1/2" & 2" meter $19.42 $21.36
3" & 4" meter $32.37 $35.61
6" meter $51.80 $56.98
8" meter $77.71 $85.48
Water Consumption Charge (per ccf)
Rate per ccf $1.34 $1.47
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons Note: Private fire protection service charges are not included in the table

2.2 Water Customer Base and Current Water Sales Revenues Table 5 includes a summary of the number of water accounts by meter size based on the City’s billing data as well as estimated water usage and service charge revenues for FY 2022/23. The City provides service to over 18,300 accounts of which approximately 450 are outside current City limits. The majority of customers have 5/8”, 3/4”, or 1” meters, representing about 94.0% of total meters.

The City collected approximately $9.3 million in total water rate revenues in FY2022/23. About 38.0% of revenues were collected from fixed charges including the connection charge, meter size charge, and private fire protection charges. The meter charges shown in Table 5 include the Connection Charge that has added on to the Meter Size Charge for each meter size. The remaining 62.0% of revenues were collected from Water Consumption Charges. Total annual water consumption in FY2022/23 was estimated at 4.3 million ccf, a decrease of about 8.0% from the previous two years.

Based on City billing records, the current average single family monthly residential water use is 16 ccf per month. Based on a typical home with a 5/8”, 3/4”, or 1” meter and 16 ccf of water use, the average water bill is currently $36.85 per month.

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City of Hanford Page 12 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 5: Estimated Water Service Sales Revenues from Billing Data, FY 2022/23 City of Hanford
Utility Rate Study

FY 2022/2023 (ESTIMATED)

METER CHARGE
Inside City Accounts Meter Charge No. of Accts Fixed Revenue % of Total 5/8", 3/4", & 1" $15.41 16,861 $3,117,936 33.5%
1-1/2" & 2" $21.88 862 $226,327 2.4%
3" & 4" $34.83 114 $47,647 0.5%
6" $54.26 12 $7,813 0.1%
8" $80.17 3 $2,886 0.0%

Outside City Accounts
5/8", 3/4", & 1" $16.96 428 $87,107 0.9%
1-1/2" & 2" $24.07 20 $5,777 0.1%
3" & 4" $38.32 1 $460 0.0%
6" $59.69 2 $1,433 0.0%
8" $88.19 2 $2,117 0.0%

Private Fire Service
4" $46.62 1 $559 0.0%
6" $69.93 2 $1,678 0.0%

Subtotal Fixed Revenue 18,308 $3,501,740 37.6%

USAGE CHARGE
All Usage Usage Charge Usage (ccf)
Usage Charge
Revenue % of Total
Inside City $1.34 4,195,771 $5,622,334 60.4%
Outside City $1.47 129,074 $189,739 2.0%
Subtotal Consumption Revenue 4,324,846 $5,812,073 62.4%

Total Water Sales Revenue $9,313,813 100.0%

CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons

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City of Hanford Page 13 Water, Wastewater, and Stormwater Utility Rate Study 2023

2.3 Current Wastewater Rates
The City’s last wastewater rate study was conducted in 2009 which determined a schedule of rates through 2011. A schedule of current monthly wastewater rates that went into effect on July 1, 2011 is provided in Table 6. The City’s current rate structure varies based on customer class.

2.3.1 Residential Customers
Residential customers pay a flat monthly charge on a per dwelling unit basis. Single family residential customers pay $17.86 per month, and multi-family customers pay $16.93 per dwelling unit. A triplex is charged for three dwelling units, as an example. The charge per dwelling unit is lower for multi-family customers than single-family customers, reflecting lower average winter water use and estimated sewer flows.

2.3.2 Commercial Customers
Commercial customers pay a volume rate per ccf based on metered monthly water use. There are four subcategories of commercial wastewater customers grouped according to strength of wastewater flow.

Customers with higher strength wastewater flow such as restaurants are billed a higher rate per ccf.

Because sewer flow is not typically metered, water consumption is used as an approximation for sewer flow. It is assumed that any outdoor irrigation water use that does not flow into the sewer is separately metered through an irrigation-only connection that is not billed for sewer service.

2.3.3 Schools
Schools are billed annually based on average daily attendance (ADA) per month during the 9 months when schools are in session.

2.3.4 Septage
The City’s septage hauler customers are billed per thousand gallons according to metered flow.

2.3.5 Industrial Customers
The City’s industrial customers are charged according to actual metered wastewater discharge (flow and pollutant loading) as well as fees for excessive discharge.

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Table 6: Current Wastewater Rates
City of Hanford
Utility Rate Study

RESIDENTIAL
Single family residences $17.86 /month
Duplex, multi-family dwelling per dwelling unit $16.93 /month

NON- RESIDENTIAL
Metered water
(a) Mobile home parks, motels, public buildings, hospitals, nursing homes, churches, fraternal lodges, service stations and automotive centers
$1.54 /ccf [1]
(b) Car washes, laundromats, retail, commercial and
professional establishments $1.44 /ccf
(c) Mixed use commercial centers including food services with single water service $2.15 /ccf
(d) Restaurants, supermarkets, grocery stores, mortuaries $2.88 /ccf Schools $0.51 /student/mo ADA [2]
Septage $26.19 /1000 gallons

INDUSTRIAL
Flow $1,561.56 /million gal.

BOD (Biological Oxygen Demand) $0.17 per lb.

SS (Suspended Solids) $0.17 per lb.
1 - CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 2 - ADA – average daily attendance

2.4 Wastewater Customer Base and Current Revenues
The City’s wastewater utility provides service to over 17,300 single family, multi family, commercial, industrial, and school accounts within the City. The majority of accounts are for single family residential customers, representing about 92.0% of total account holders.

Table 7 includes an estimate of total wastewater rate revenues collected in FY2022/23 based on the City’s billing data as well as the number of billing units in each customer class. It is estimated that the City collected approximately $5.39 million in total wastewater rate revenues in FY2022/23. About 81.0% of revenues were collected from the flat charges billed to single and multi-family residential customers.

Industrial revenues account for over 4.0% of total while commercial revenues represent approximately

13.0%. The remainder of revenues are comprised of school and septage revenues.

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Table 7: Estimated Wastewater Service Charge Revenues from Billing Data, FY 2022/23 City of Hanford
Utility Rate Study

FY 2022/2023 (ESTIMATED)

FIXED CHARGES
Residential Customers
Monthly Fixed
Charge No. of Units
Estimated
Fixed
Revenue % of Total
Single Family Residential $17.86 15,872 $3,401,687 64.3% Multi-Family Residential per unit $16.93 4,345 $882,730 16.7% Subtotal Residential $4,284,417 81.0%

VOLUME RATES
Industrial Customers
Usage Charge
($/million gal
or $/lb.) Units
Estimated
Revenue % of Total
Flow (million gallons) $1,561.0 145.16 $226,595 4.3%
BOD (lbs) $0.173 33,269 $5,761 0.1%
SS (lbs) $0.167 27,119 $4,527 0.1%
Subtotal Industrial $236,883 4.5%

Commercial Customers
Usage Charge
($/ccf) Billed Flow
Estimated
Revenue % of Total
Group A: Domestic $1.54 129,553 $199,512 3.8%
Group B: Low Strength $1.44 168,658 $242,868 4.6%
Group C: Medium Strength $2.15 12,939 $27,819 0.5%
Group D: High Strength $2.89 79,588 $230,009 4.3%
Subtotal Commercial 390,738 $700,207 13.2%

Schools
Charge per
student (ADA)
# of
students
Estimated
Revenue % of Total
$0.51 $48,539 0.9%
Subtotal Schools $48,539 0.9%

Septage
Usage Charge
($/1000 gal)
Billed Flow
(1,000 gal)
Estimated
Revenue % of Total
$26.19 765 $20,038 0.4%
Subtotal Septage $20,038 0.4%

TOTAL WASTEWATER SERVICE REVENUES $5,290,084 100.0%

CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons

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City of Hanford Page 16 Water, Wastewater, and Stormwater Utility Rate Study 2023

2.5 Current Storm Drainage Rates and Revenues
Of the existing wastewater system charges adopted in the City’s Resolution No. 09-77-R, 78.0% of the service charges for each customer are allocated to the wastewater system as shown in Table 6, and the remaining 22.0% are allocated to the storm drain system. Thus, the rate structure for the storm drain system is the same as the rate structure for the wastewater system. A schedule of current monthly storm drain rates that went into effect on July 1, 2011 is provided in Table 8. Residential customers are billed a flat charge per dwelling unit, commercial customers are billed a volume rate per ccf of metered water usage, schools are billed per student, septage users are billed per thousand gallons, and industrial customers are billed according to metered wastewater discharge.

Annual fee revenues collected in FY2022/23 were estimated at $1.45 million. About 65.0% of revenues were collected from single family residential customers. Multi-family residential customers generated

16.2% of revenues, businesses generated 10.5%, industrial customers generated 5.9%, and the remainder were collected from public agencies and schools.

Table 8: Current Storm Drainage Rates
City of Hanford
Utility Rate Study

RESIDENTIAL
Single family residences $5.04 /month
Duplex, multi-family dwelling per dwelling unit $4.77 /month

NON- RESIDENTIAL
Metered water
(a) Mobile home parks, motels, public buildings, hospitals, nursing homes, churches, fraternal lodges, service stations and automotive centers
$0.43 /ccf [1]
(b) Car washes, laundromats, retail, commercial and
professional establishments $0.40 /ccf
(c) Mixed use commercial centers including food services with single water service $0.61 /ccf
(d) Restaurants, supermarkets, grocery stores, mortuaries $0.81 /ccf Schools $0.15 /student/mo ADA [2]
Septage $7.39 /1000 gallons

INDUSTRIAL
Flow $440.44 /million gal.

BOD (Biological Oxygen Demand) $0.0488 per lb.

SS (Suspended Solids) $0.0471 per lb.
1 - CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 2 - ADA = average daily attendance

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City of Hanford Page 17 Water, Wastewater, and Stormwater Utility Rate Study 2023

SECTION 3: WATER REVENUE REQUIREMENT
Proposition 218 requires that utility rates be based on the reasonable cost of providing service to customers. The cost of service includes annual operating expenses, capital improvement projects, and the accumulation of appropriate reserves. This section summarizes the water utility’s revenues and expenses to determine the total cost of service to be recovered via rates. The cost of service is expressed in a cash flow table that illustrates revenue increases needed to keep up with expenses and maintain the financial health of the enterprise.

3.1 Water System Overview
The City is responsible for providing safe, clean water through the operation of its water system consisting of over 220 miles of water mains, 12 water supply wells, and 3.5 million gallons of water storage. The City’s sole water source is groundwater from within the San Joaquin Valley Groundwater Basin which is obtained from wells and chlorinated before distribution. One well also includes treatment facilities for the removal of arsenic.

There are over 18,000 active water accounts including City residents and a small number of residents in surrounding areas. On average over the past 3 years, the City has consumed between 4.5 million and 5 million ccf of water each year. Single family residential consumption comprises more than half of the City’s total consumption at approximately 66.0% with the remaining 33.0% of use by multi-family residential, commercial, industrial, public agency, and school customers. Based on City billing records, the current average monthly single family residential water use is 16 ccf per month.

3.2 Water Reserves
The accumulation and maintenance of reasonable reserves is one factor to consider when determining the cost of service. Adequate fund reserves protect the City when faced with unforeseen financial challenges such as emergency expenses or revenue deficits. Fund reserves allow the City to maintain its financial health and positive credit ratings, especially during emergencies. Moreover, funding can be drawn from reserves to supplement rate revenues lost during drought conditions or other unexpected situations. The City can also choose to use reserves to smooth cash flows and mitigate impacts to ratepayers.

The City maintains two water reserve funds – 1) an operating fund reserve and 2) a capital reserve fund reserve. As of the beginning of FY 2023/24, the water utility had operations fund reserves of approximately $9.98 million and capital and reserve fund reserves of approximately $10.58 million. Total reserves are strong. The recommended reserve target is 50 percent of annual operating costs plus one year’s total debt service payment.

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City of Hanford Page 18 Water, Wastewater, and Stormwater Utility Rate Study 2023

3.3 Water Capital Improvement Plan
Table 9 provides the City’s capital improvement plan (CIP) by year for the rate study period, totaling $43.7 million. Projects funded by impact fees or other non-rate sources are not included. Major projects include the replacement of water meters and aged water mains throughout the City.

Table 9: Water Capital Improvement Plan (rate funded)
City of Hanford
Utility Rate Study

Project Title FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 5-Year Total Water Sys Security Upgrades $605,740 - - - - $605,740 Utility Customer Payment Kiosks (2) $27,000 $14,000 $14,000 $14,000 $14,000 $83,000 Industrial Park Water Storage - $3,879,800 - - - $3,879,800 Tank 4 Chlorination $66,070 - - - - $66,070
Repr Well 45 & 49 $86,060 - - - - $86,060
Lacey Blvd Widen Magna Carta to 13th - - - $500,000 - $500,000 2910 Well Pump Rehab 42 & 38 $120,000 $120,000 - - - $240,000 2910 Spare Motor 250 - - $60,000 - - $60,000
Water Distrib Main Ext Program - $480,000 - - - $480,000 Water Main Repl Program $700,000 - $700,000 - $700,000 $2,100,000 New Water Supply Well $900,000 - $900,000 - $900,000 $2,700,000 2910 Meter Replacement $5,000,000 $5,000,000 $5,000,000 - - $15,000,000 Unsch Main Exten/Repl-Water $50,000 $50,000 $50,000 $50,000 $50,000 $250,000 2081 Fire Hydrants $28,000 - - - - $28,000
1750 Pw Enclosed Warehouse - - $200,000 - - $200,000 Lacey Widen/Recon/10th-Sierra $366,020 $584,640 $223,870 - - $1,174,530 Meter Replacement Program $857,830 $120,000 $120,000 $120,000 $120,000 $1,337,830 Automated Meter Zenner Eq Repair $638,180 - - - - $638,180 Amr Replacement Program $400,000 $400,000 $400,000 $400,000 $400,000 $2,000,000 Annual Repairs & Replacement - $500,000 $500,000 $500,000 $500,000 $2,000,000 Well 51 and Well 52 - $4,240,000 - - - $4,240,000
Well and Tank at Heroes Park - - - - $6,000,000 $6,000,000 Total Water CIP $9,844,900 $15,388,440 $8,167,870 $1,584,000 $8,684,000 $43,669,210

3.4 Water Cash Flow Projection
The water fund cash flow for the five-year period beginning in FY 2023/24 through FY 2027/28 is provided in Table 10. The cash flow is based on the City’s FY 2023/24 and 2024/25 Budget and includes revenue increases such that the City covers operating and debt service costs, funds all proposed capital improvement projects, and maintains adequate reserves. Revenue increases over the course of the five- year period are proposed to be 35.0% in the first year followed by 15.0%, 10.0%, 5.0%, and 5.0%. It should be noted that this level of increase is applied to the City’s total water rate revenues and does not necessarily reflect the level of increase for individual customers. Each customer’s bill varies depending

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on meter size and water usage. The first rate increase is proposed to go into effect February 1, 2024, followed by subsequent increases each July 1 beginning in 2024 through 2027.

3.4.1 Water Revenues
As shown in Table 5, current water rates are estimated to generate $9.3 million in revenues. For FY 2023/24, rate revenues are projected at $10.4 million, assuming the City will collect rates at the current revenues for 7 months and rates with proposed revenue increases for 5 months. Rate revenues are the main revenue source for the water utility, comprising about 97.0% of total water revenues. Other revenue sources include penalty fees, job orders, interest income, and miscellaneous income. These other sources generate about $299,000 annually, which is projected to remain constant over the next five years.

3.4.2 Water Expenses
The cash flow uses the City’s FY 2023/24 and FY 2024/25 Budget as the basis for projected expenses.

Most operating expenses are projected to increase 3.0% annually beginning in FY 2025/26, except for Salaries & Benefits which are escalated by 7.0% annually beginning in FY 2025/26 per City direction. The water fund’s share of payments for the principle for the Pension Obligation Bond (POB) are included as a new expense. New fees payable to the local Groundwater Sustainability Agency (GSA) are estimated at $100,000 annually for administration plus an additional $500,000 per year for pumping fees beginning in FY 2024/25. Annual depreciation is not included as a cash expense. The City’s capital improvement plan includes funding for the repair and replacement of infrastructure to keep up with wear and tear on the City’s facilities.

3.4.3 Debt Service and Debt Service Coverage
A chief covenant for the City to secure loans, grants, or revenue bonds/Certificates of Participation (COPs) is to maintain a specific debt service coverage ratio. A debt service coverage ratio is a financial measure of an agency’s ability to repay outstanding debt. For the water fund, the debt service coverage ratio means that annual water net revenues (gross revenues less operating and maintenance expenses) must be at least 1.2 times the combined annual debt service payments on all parity obligations. Failure to meet the debt service coverage ratio on an annual basis is considered to be technical default, thereby making the revenue bonds/COPs callable or payable upon demand. Thus, rates and fees must be set to meet this legal requirement.

The water utility currently has one outstanding debt obligation that counts toward its debt service coverage requirement – Water Revenue Refunding Bonds, Series 2013. In 2013, the City issued $12.725 million in bonds bearing interest of 2.0% to 5.0% payable semi-annually beginning in October 2013. The Bonds were issued to refinance the City’s previously issued $8.925 million CSCDA Water and Wastewater Revenue Bonds dated December 9, 2003 and the $8.15 million Installment Sale Agreement – Water System dated December 20, 2007. Total annual debt service is about $1.1 million and will be

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paid off in October 2028. The rates proposed in this study are expected to generate adequate revenues to meet the City’s current and future coverage requirements.

3.4.4 Five-Year Summary
Figure 4 graphically shows the water cash flow projection for the five-year rate study period including both operating and capital expenses. In the first few years, expenses will exceed revenues. The City will spend down some of its existing reserves to fund capital projects, thereby mitigating the level of rate increases needed for customers. At the end of the five-year period, the City’s revenues are projected to be in-line with total expenses.

Figure 4: Water Cash Flows

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Table 10: Water Cash Flow Projection
City of Hanford
Utility Rate Study Years 1 -5: Proposition 218 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Rate Revenue Increase 35.0% 15.0% 10.0% 5.0% 5.0%
Rate Increase Effective Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 BEGINNING FUND BALANCE [1] $9,975,000 $4,324,000 $2,038,000 $3,416,000 $5,304,000 REVENUES Rate Revenues [2] 10,398,000 14,457,000 15,903,000 16,698,000 17,533,000 Penalties 40,000 40,000 40,000 40,000 40,000
Service Orders/Job Orders 90,000 90,000 90,000 90,000 90,000 Interest Income 39,000 39,000 39,000 39,000 39,000
Miscellaneous Income 130,000 130,000 130,000 130,000 130,000 Total Revenue 10,697,000 14,756,000 16,202,000 16,997,000 17,832,000 EXPENSES Operating Expenses
Salaries and Benefits 1,782,000 1,996,000 2,136,000 2,286,000 2,446,000 Supplies and Equipment 1,363,000 1,353,000 1,394,000 1,436,000 1,479,000 Outside Services 235,000 231,000 238,000 245,000 252,000 City Services Allocation 1,065,000 1,065,000 1,097,000 1,130,000 1,164,000 GSA Fees 100,000 600,000 600,000 600,000 600,000
POB Principal 230,000 225,000 226,000 225,000 234,000 Chemicals 300,000 300,000 309,000 318,000 328,000
Utilities 1,645,000 1,645,000 1,694,000 1,745,000 1,797,000 Subtotal O&M 6,720,000 7,415,000 7,694,000 7,985,000 8,300,000 Net Operating Revenue 3,977,000 7,341,000 8,508,000 9,012,000 9,532,000 Debt Service Water Rev Refunding Bonds, Series 2013 1,128,000 1,127,000 1,130,000 1,124,000 1,134,000 Transfers Out (#570250) 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 Addt'l Transfer to Capital Fund 6,000,000 6,000,000 3,500,000 3,500,000 3,500,000 Transfers to Capital Fund 8,500,000 8,500,000 6,000,000 6,000,000 6,000,000 Total Operations Fund Net Revenues (5,651,000) (2,286,000) 1,378,000 1,888,000 2,398,000 OPERATIONS FUND ENDING BALANCE 4,324,000 2,038,000 3,416,000 5,304,000 7,702,000 Operations Fund Reserve Target [3] 4,488,000 4,835,000 4,977,000 5,117,000 5,284,000 Operating Reserve Target Met? no no no yes yes Debt Service Coverage (Target = 1.20x) [4] 3.53 6.51 7.53 8.02 8.41 CAPITAL & RESERVE BEG. BALANCE [5] 10,582,000 9,237,000 2,349,000 181,000 4,597,000 Revenues Transfer from Operations Fund (#570250) 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 Transfer from Operations Fund 6,000,000 6,000,000 3,500,000 3,500,000 3,500,000 Subtotal Capital Revenues 8,500,000 8,500,000 6,000,000 6,000,000 6,000,000 Capital Plan Expenses 9,845,000 15,388,000 8,168,000 1,584,000 8,684,000 Capital Fund Net Revenues (1,345,000) (6,888,000) (2,168,000) 4,416,000 (2,684,000)

CAPITAL & RESERVE ENDING BALANCE 9,237,000 2,349,000 181,000 4,597,000 1,913,000 1 - Estimated Water Operations Fund cash fund balance from City staff 2 – FY 2023/24 revenues are estimated based on 7 months at current rate revenues and 5 months with proposed rate increases 3 - Recommended targets is 6 months O&M Expenses plus annual debt service cost 4 - Net Operating Revenue divided by Total Debt Service 5 - Estimated Water Capital & Reserve Fund cash fund balance from City staff

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SECTION 4: WATER COST ALLOCATION AND RATE DESIGN

4.1 Water Cost Allocation
The water revenue requirement detailed in the previous section determines the total cost of providing service to be recovered from water rates, and in this section that revenue requirement is assigned to fixed and consumption charges to fairly recover costs from customers based on how they use the water system. Proposition 218 requires that agencies providing “property-related services” (including water utility service) set rates and charges that are based on the cost of providing those services and are proportional to how customers use the system.

4.1.1 Overview of Water Cost of Service Methodology
The purpose of the cost allocation is to classify costs and to determine the amount of revenue that will be recovered from fixed charges and from consumption charges. The American Water Works Association (AWWA) recommends methods to classify costs among various customers. Using the Base- Extra Capacity Method as recommended by the AWWA, water operating expenses are allocated to the following categories: (a) Base, (b) Extra, (c) Meters & Services, and (d) Customer Service. The Base and Extra categories are intended to recover variable (consumption) costs, while the Customer Service and Meters & Services categories are intended to recover fixed expenses that are incurred regardless of water used.

 Base: Base costs include the expenses related to providing water under average, “base” demand conditions.

 Extra: The extra category includes costs related to providing water above the system average demand (ie. related to peak, “extra” usage).

 Meters & Services: These include costs related to maintaining and replacing water meters and operating costs related to providing service at the maximum demand of each meter.

 Customer Service: This category contains costs associated with serving customers, such as billing and answering customer inquiries.

4.1.2 Cost Allocation
The cost allocation for the water utility is provided below in Table 11. The FY 2023/24 Budget is used as the test year for the cost allocation. Costs are allocated according to how they are incurred by the City.

Based on the proposed allocation, roughly 33.0% of costs will be recovered from the Fixed Charges while the remaining 67.0% will be recovered from Consumption Charges.

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Table 11: Water Cost Allocation City of Hanford Utility Rate Study Budgeted Expenses Budget FY
2023/24
Consumption
Charge Fixed Charge
Base & Extra Meters Customer Service

Operating Expenses
Salaries and Benefits $1,782,000 66.67% 16.67% 16.67%
Supplies and Equipment $1,363,000 60.00% 20.00% 20.00%
Outside Services $235,000 60.00% 20.00% 20.00%
GSA Fees $100,000 0.00% 50.00% 50.00%
POB Principal $230,000 66.67% 16.67% 16.67%
Chemicals $300,000 100.00% 0.00% 0.00%
Utilities $1,645,000 100.00% 0.00% 0.00%
Subtotal $5,655,000 $4,245,133 $704,933 $704,933

75.07% 12.47% 12.47%

City Services Allocation $1,065,000 75.07% 12.47% 12.47% Total Operating $6,720,000 $5,044,615 $837,693 $837,693

Non-Operating Expenses
Debt Service (5-year avg) $1,128,600 100.00% 0.00% 0.00% Water CIP Projects (5-year avg) [1] $8,733,800 56.36% 43.45% 0.19% Subtotal Non-Operating $9,862,400 $6,050,616 $3,795,184 $16,600

Total Expenses $16,582,400 $11,095,231 $4,632,876 $854,293 Proposed Cost Allocation % 66.91% 27.94% 5.15%

1 - Based on CIP projects over the next five years

4.1.3 Annual Revenue Requirement Allocation
To determine the total revenues that must be collected each year from fixed and consumption charges, the cost allocation percentages from Table 11 are applied to the total water rate revenue requirements from the cash flow projection (Table 10). The fixed charge revenue requirement is based on the Meters & Services and Customer Service categories from the cost allocation. The consumption charge revenue requirement is based on the Base and Extra categories.

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Table 12: Annual Revenue Requirement Allocation
City of Hanford
Utility Rate Study Cost
Allocation
%

PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

Total Revenue
Requirement [1] $12,571,000 $14,457,000 $15,903,000 $16,698,000 $17,533,000

FIXED CHARGES
Meters & Services 27.9% $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Customer Service Charge 5.2% $647,633 $744,796 $819,291 $860,248 $903,266 Total Fixed Charges 33.1% $4,159,784 $4,783,867 $5,262,353 $5,525,421 $5,801,726

CONSUMPTION CHARGES
Total Consumption Charges 66.9% $8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274

TOTAL 100.0% $12,571,000 $14,457,000 $15,903,000 $16,698,000 $17,533,000

1 – FY 2023/24 Revenue Requirement is if February 1 rates were to be in effect for 12 months

4.2 Billing Units

4.2.1 Meter Equivalents
The most common method to levy fixed charges is by meter size. AWWA guidelines recommend using meter equivalents to assign demand-related and service related costs to larger meter sizes. The ratio at which the meter charge increases is typically a function of either meter investment (estimated cost) or the meter’s safe operating capacity. The AWWA M1 Manual 7th Edition page 77 states “billing ratios are used to recognize that billing, metering, and collection costs for larger services may be greater than for smaller meter-size services. This may be due to difficulty in accessing the meter facility, replacement of meters, multiple dial meters, more customer service time associated with dealing with larger meter customers, and other factors.” These costs are reflected in the portion of Salaries and Benefits and Supplies and Equipment line items allocated to Customer Service and Meters in Table 11.

Moreover, larger meters have the ability to place a greater demand on the water system and are therefore charged based on that potential demand (or standby capacity). Water system components such as pumps, tanks, and pipelines are engineered and designed to meet maximum hour demand plus fire flow. The City incurs costs to maintain and operate these facilities at maximum capacity 24 hours a day, 365 days per year. For example, a customer that has a 6” meter has 20 times the capacity equivalency (flow rate) of a customer with a 5/8” or 1” meter. (A 6” meter has a safe operating capacity of 1,000 gallons per minute (gpm) compared to a 5/8” or 1” meter which has a safe operating capacity

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of 50 gpm). If all customers had 5/8” meters, the City would incur lower operating and capital costs as facilities would be smaller sized and more easily replaced and maintained. The AWWA M1 Manual 7th Edition page 152 states "this analysis considers that there is a minimum system in place to meet minimum service requirements regardless of use. The minimum needs are defined by determining the minimum size a system would be designed to meet minimum or average service needs (e.g., 4-in. service) not considering sizing for peak-day capacity needs or fire protection. The percentage of the distribution system related to meeting the minimum system needs would be applied to distribution-related costs and would be collected in the fixed charges. Incremental system sizing related to sizing the system to meet peak-day needs and fire flow requirements may also be considered for inclusion in the fixed charges.” These costs are staffing, maintenance, and capital expenses from Table 11 associated with providing capacity for the maximum flow rate of each meter.

Table 13 shows the existing number of meters by meter size and calculates the number of meter equivalents based on the AWWA recommended meter ratios. The base meter size for the City is the 5/8”, 3/4”, or 1” meter, representing over 94.0% of all meters served. The recalculation of meter equivalents for larger meter sizes will amend the fixed charges so that each meter size will be charged based on their proportional impact on the system.

Table 13: Number of Meter Equivalents (Total Inside & Outside City Accounts) City of Hanford
Utility Rate Study
Meter Size
No. of
Meters
Flow Rate
(gpm)
Meter
Ratio
No. of Meter
Equivalents
5/8", 3/4", & 1" 17,289 50 1.00 17,289
1-1/2" & 2" 882 100 2.00 1,764
3" & 4" 115 320 6.40 736
6" 14 1,000 20.00 280
8" 5 1,600 32.00 160
TOTAL 18,305 20,229
Flow rates taken from AWWA M1 Manual 7th Edition page 386

4.2.2 Projected Growth and Use
Table 14 shows an estimate of total water meters, water meter equivalents, and water use for the next five years. Customer growth is projected at 0.9% each year beginning in FY 2024/25 based on the projected annual growth rate from the City’s most recent Urban Water Management Plan by the Akel Engineering Group. Estimated current water use is based on billing data from the past two years less an

8.0% conservation factor to account for actual decreased water rate revenue in FY 2022/23.

Consumption is conservatively estimated to remain level through the first two years of the study period to account for conservation as customers adjust to the increased water rates. Beginning in FY 2025/26, water consumption is estimated to increase by 0.9% each year concurrently with growth in the customer base.

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Table 14: Projected Customer Growth & Water Consumption City of Hanford
Utility Rate Study CURRENT PROJECTED - RATE STUDY PERIOD 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

NUMBER OF METERS

Growth Increase % [1] 0.00% 0.90% 0.90% 0.90% 0.90%

Total Water Meters 18,305 18,305 18,470 18,636 18,804 18,973

Total Meter Equivalents 20,229 20,229 20,411 20,595 20,780 20,967

WATER CONSUMPTION

Annual Increase % [2] 0.00% 0.00% 0.90% 0.90% 0.90%

Total Consumption [3] 4,324,846 4,324,846 4,324,846 4,363,769 4,403,043 4,442,671

1 - Table 3-2, Urban Water Management Plan by Akel Engineering Group projects an annual growth rate of 0.9% 2 - Projected water use for FY2024 and FY2025 reflect no growth in use as customers adjust to the new rate increases
3 - Note: Projected 2023 consumption is based on the average of FY 2020/21 and FY 2021/22 less 8% to account for observed conservation during FY 2022/23

4.3 Water Rate Design
To comply with Proposition 218, the following modifications to the existing water rate structure are proposed:
 Inside vs. Outside City Rates
 Eliminate the 10% surcharge for customers outside the City limits.

 Fixed Meter Charge
 Use the AWWA meter capacity ratios to calculate rates for the larger meter sizes. The re- alignment will amend the fixed charges so that each meter size will be charged based on their proportional impact on the system. This is in-line with industry standard practice and is the policy of most other local utility providers.

 Drought Rates
 Adopt a schedule of drought consumption charges whereby the rate per unit of water (ccf) for all customers will temporarily increase should the City declare a water shortage emergency. The drought rates are in alignment with the City’s existing Water Shortage Contingency Plan.

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4.4 Water Rate Derivation
Following the allocation of costs, the next step is to derive the total cost responsibility for each customer class by developing unit costs of service for each cost function and then assigning those costs to the customer classes based on the respective service requirements of each.

4.4.1 Fixed Meter Charge Calculation
Table 15 shows the rate derivation for the proposed Fixed Charge by meter size based on the AWWA meter equivalents from Table 13 and the total revenue requirements from Table 12. The customer service portion of the Fixed Charge is proposed to be the same for each customer regardless of meter size, whereas the meter equivalent portion of the fixed charge is proposed to be based on meter size.

The total Meters & Services revenue requirement is divided by the total number of meter equivalents.

The Customer Service revenue requirement is divided by the total number of accounts.

For 2023/24, the proposed meter equivalent charge of $14.47 is multiplied by the corresponding meter equivalent ratio to calculate a charge for each meter size. The customer service charge of $2.95 is then added to the meter equivalent charge for each meter size to calculate the total proposed fixed charge.

The proposed 2023/24 charge for a 5/8”, 3/4”, or 1” meter is $17.42.

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Table 15: Water Fixed Charge Derivation
City of Hanford
Utility Rate Study

PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

REVENUE REQUIREMENT
Meters & Services $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Customer Service Charge $647,633 $744,796 $819,291 $860,248 $903,266 Total Fixed Charge Rev. Requirement $4,159,784 $4,783,867 $5,262,353 $5,525,421 $5,801,726

METER EQUIVALENT CHARGE

Total Meter Equivalent Charge Revenue
Requirement 7.8% $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Total Number of Meter Equivalents 20,229 20,411 20,595 20,780 20,967 Total Meter Equivalent Charge $14.47 $16.49 $17.98 $18.71 $19.47

Meter Equivalent Charge by Meter Size
Meter Size Ratio
5/8", 3/4", & 1" 1.00 $14.47 $16.49 $17.98 $18.71 $19.47 1-1/2" & 2" 2.00 $28.94 $32.98 $35.96 $37.42 $38.94 3" & 4" 6.40 $92.61 $105.54 $115.07 $119.74 $124.61 6" 20.00 $289.40 $329.80 $359.60 $374.20 $389.40
8" 32.00 $463.04 $527.68 $575.36 $598.72 $623.04

CUSTOMER SERVICE CHARGE

Total Customer Service Charge Revenue
Requirement 7.8% $647,633 $744,796 $819,291 $860,248 $903,266 Total Number of Meters 18,305 18,470 18,636 18,804 18,973 Total Customer Service Charge per
Account
$2.95 $3.36 $3.66 $3.81 $3.97

TOTAL MONTHLY FIXED CHARGE [1]

Meter Size
5/8", 3/4", & 1" $17.42 $19.85 $21.64 $22.52 $23.44 1-1/2" & 2" $31.89 $36.34 $39.62 $41.23 $42.91
3" & 4" $95.56 $108.90 $118.73 $123.55 $128.58
6" $292.35 $333.16 $363.26 $378.01 $393.37
8" $465.99 $531.04 $579.02 $602.53 $627.01

1 - Total Monthly Fixed Charge is the sum of the "Meter Equivalent Charge" by meter size plus the "Total Customer Service Charge per Account"

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4.4.2 Consumption Charge Derivation
Table 16 calculates the Consumption Charge for all customers based on the total revenue requirement from Table 12 and projected annual water consumption from Table 14. The proposed Consumption Charge is a single uniform tier in which all customer classes are charged the same rate for each unit of water consumption. The proposed FY 2023/24 Consumption Charge is $1.94 per ccf.

Table 16: Consumption Charge Rate Derivation
City of Hanford
Utility Rate Study

PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

REVENUE REQUIREMENT
Total Consumption Charge Revenue
Requirement
$8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274

CONSUMPTION CHARGE DERIVATION
Revenue Requirement $8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274 Total Consumption (ccf) 4,324,846 4,324,846 4,363,769 4,403,043 4,442,671 Rate per ccf $1.94 $2.24 $2.44 $2.54 $2.64

CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons

4.4.3 Drought Rate Derivation
It is recommended that the City implement a series of drought consumption charges which can be implemented during a water shortage emergency, allowing for financial stability during periods of reduced water sales. Drought rates are designed to cover costs at decreased levels of consumption. The City recognizes that ratepayers are already doing their part to conserve. Therefore, applying the drought surcharge to only the consumption charge component gives customers the increased ability to control a portion of their water bills. The proposed drought rates would be charged on a temporary basis and would be phased out when the City determined that water supply conditions had returned to normal and drought-related costs and revenue reductions had been recovered.

During times of water shortages, a water utility has two core objectives: 1) to reduce the amount of water customers consume, and 2) to cover the cost of operations. The two competing objectives work against each other because as less water is sold, it becomes more difficult to maintain adequate revenue to cover an agency’s costs. It should be noted that under drought conditions, certain expenses such as electricity, supplies, and equipment will decrease relative to the decrease in water use. However, other costs to operate the water system such as staffing and maintaining long-term supply remain the same.

The reduction in cost during drought conditions is reflected in the revenue requirements shown in Table

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17. The levels of water cutback for the proposed drought rates in Table 17 are designed to be in alignment with the City’s existing Water Shortage Contingency Plan and represent potential water shortage scenarios. Estimated base and extra expenses under each cutback scenario are divided by total water usage to calculate the drought consumption charges.

Table 17: Consumption Charge Rate Derivation - Drought Rates City of Hanford Utility Rate Study

PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

CONSUMPTION CHARGE DERIVATION - 10% Cutback
Revenue Requirement $8,191,081 $9,419,971 $10,362,164 $10,880,174 $11,424,248 Total Consumption (ccf) 3,892,361 3,892,361 3,927,392 3,962,739 3,998,404 Rate per ccf $2.10 $2.42 $2.64 $2.75 $2.86

CONSUMPTION CHARGE DERIVATION - 20% Cutback
Revenue Requirement $7,970,946 $9,166,810 $10,083,681 $10,587,770 $11,117,222 Total Consumption (ccf) 3,459,877 3,459,877 3,491,016 3,522,435 3,554,137 Rate per ccf $2.30 $2.65 $2.89 $3.01 $3.13

CONSUMPTION CHARGE DERIVATION - 35% Cutback
Revenue Requirement $7,640,743 $8,787,068 $9,665,957 $10,149,164 $10,656,682 Total Consumption (ccf) 2,811,150 2,811,150 2,836,450 2,861,978 2,887,736 Rate per ccf $2.72 $3.13 $3.41 $3.55 $3.69

CONSUMPTION CHARGE DERIVATION - 50% Cutback
Revenue Requirement $7,310,541 $8,407,326 $9,248,233 $9,710,557 $10,196,143 Total Consumption (ccf) 2,162,423 2,162,423 2,181,885 2,201,522 2,221,335 Rate per ccf $3.38 $3.89 $4.24 $4.41 $4.59
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons

4.4.4 Proposed Water Rates
Table 18 summarizes the proposed monthly water rates for the next five years including meter charges, consumption charges, and drought consumption charges. All accounts, including residential, commercial, and industrial customers, will be charged according to the proposed rate schedule shown.

The first rate change is proposed to take effect on February 1, 2024, with subsequent rate increases effective each July 1 beginning in 2024 through 2027. For FY 2023/24, the proposed 35.0% revenue adjustment in the cash flow (Table 10) does not directly correlate to a 35.0% increase in rates due to the cost of service reallocation and the updated rate structure. The percentage increases for each rate category are shown below the table.

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Table 18: Proposed Monthly Water Rates City of Hanford Utility Rate Study

Current [1]

PROPOSED
Fiscal Year FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2018 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027

CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 1 - Current rates shown are for Inside City customers - Inside & Outside City customers are proposed to be billed the same rates going forward.
2 - Only to be implemented temporarily during water shortage emergencies.

Proposed % rate increases
Meter Charges
5/8", 3/4", & 1" 13.0% 13.9% 9.0% 4.1% 4.1%
1-1/2" & 2" 45.7% 14.0% 9.0% 4.1% 4.1%
3" & 4" 174.4% 14.0% 9.0% 4.1% 4.1%
6" 438.8% 14.0% 9.0% 4.1% 4.1%
8" 481.3% 14.0% 9.0% 4.1% 4.1% Consumption Charge 44.8% 15.5% 8.9% 4.1% 3.9%

Drought Consumption Charges
10% Water Cutback - 15.2% 9.1% 4.2% 4.0%
20% Water Cutback - 15.2% 9.1% 4.2% 4.0%
35% Water Cutback - 15.1% 8.9% 4.1% 3.9%
50% Water Cutback - 15.1% 9.0% 4.0% 4.1%

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4.5 Water Bill Impacts
Bill impacts to customers for the first year will vary based on meter size and actual consumption.

Moreover, water consumption, particularly for single family customers, typically varies due to seasonal variations in weather and/or other factors. Hence, a single customer could face a range of impacts throughout the year. Table 19 includes a sample of bill impacts at different levels of water use for single family residential customers with a 5/8”, 3/4”, or 1” meter.

Table 19: Sample Monthly Residential Water Bill Impacts City of Hanford
Utility Rate Study

RESIDENTIAL BILL IMPACTS - 5/8", 3/4", & 1" METER
Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027

6 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 6 $8.04 $11.64 $13.44 $14.64 $15.24 $15.84 Total Monthly Water Bill $23.45 $29.06 $33.29 $36.28 $37.76 $39.28 $ Change $5.61 $4.23 $2.99 $1.48 $1.52
% Change 23.9% 14.6% 9.0% 4.1% 4.0%
10 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 10 $13.40 $19.40 $22.40 $24.40 $25.40 $26.40 Total Monthly Water Bill $28.81 $36.82 $42.25 $46.04 $47.92 $49.84 $ Change $8.01 $5.43 $3.79 $1.88 $1.92
% Change 27.8% 14.7% 9.0% 4.1% 4.0%

16 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 16 $21.44 $31.04 $35.84 $39.04 $40.64 $42.24 Total Monthly Water Bill $36.85 $48.46 $55.69 $60.68 $63.16 $65.68 $ Change $11.61 $7.23 $4.99 $2.48 $2.52
% Change 31.5% 14.9% 9.0% 4.1% 4.0%
25 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 25 $33.50 $48.50 $56.00 $61.00 $63.50 $66.00 Total Monthly Water Bill $48.91 $65.92 $75.85 $82.64 $86.02 $89.44 $ Change $17.01 $9.93 $6.79 $3.38 $3.42
% Change 34.8% 15.1% 9.0% 4.1% 4.0%
40 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 40 $53.60 $77.60 $89.60 $97.60 $101.60 $105.60 Total Monthly Water Bill $69.01 $95.02 $109.45 $119.24 $124.12 $129.04 $ Change $26.01 $14.43 $9.79 $4.88 $4.92
% Change 37.7% 15.2% 8.9% 4.1% 4.0%

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4.5.1 Regional Water Bill Survey
The following figure compares the City’s current average monthly single family residential bill with those of surrounding agencies. The typical monthly water use for a single family customer is 16 ccf of water use. The City’s current average water bill is $36.85 per month. With the proposed increase for 2023/24, the average water bill is projected to be $48.46, an increase of $11.61. The City’s current water rates are on the lower end of those charged and the proposed rates will be in the mid-range.

Figure 5: Monthly Single Family Residential Water Bill Survey

4.5.2 Survey of Fixed Monthly Meter Charges
As noted in Section 4.2.1, the City’s current meter charges are out of alignment with the capacity equivalency of each meter size. As part of the rate survey process, the City’s current and proposed fixed monthly charges for each meter size were compared with the corresponding charges for other local service providers, see Figure 6. For all meter sizes, the City’s current meter charges are significantly lower than the average charges for other agencies. As shown in the charts below, even with the proposed increases to the fixed charges, the City’s fixed charges will remain in the low- to mid-range for the local area.

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Figure 6: Fixed Monthly Meter Charge Survey

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SECTION 5: WASTEWATER REVENUE REQUIREMENT
Similar to the water utility, the wastewater utility’s cost of service and revenue requirement is comprised of operating costs, capital improvement costs, and the need to maintain reasonable reserves.

5.1 Wastewater System Overview
The City of Hanford is responsible for operating and maintaining a safe, dependable sanitary sewer system composed of over 226 miles of sanitary sewer mains, 23 lift stations, a wastewater treatment plant (WWTP), a pretreatment program, and laboratory facilities. The City collects wastewater from customers within the City limits and some unincorporated areas. The collected flows are conveyed through a trunk system to the City’s WWTP where they are treated and subsequently discharged to retention ponds before being delivered to farmlands for agricultural irrigation. The WWTP processes approximately 1.6 billion gallons of sewage each year. WWTP staff also conduct laboratory tests to monitor the performance of the plant, administer the industrial pretreatment program, and manage reclaimed water usage to ensure compliance with state reclamation discharge permits.

5.2 Wastewater Reserves
The accumulation of reasonable reserves is one factor to consider when determining the cost of service.

Utilities should maintain reserves to fund issues such as unexpected costs and emergency repairs or to provide cash flow in case of customer billing or revenue collection issues. Moreover, fund reserves allow the City to maintain its financial health and positive credit ratings, especially during emergencies.

The City maintains two wastewater reserve funds – 1) an operating fund reserve and 2) a capital reserve fund reserve. As of the beginning of 2023/24, the wastewater utility had operations fund reserves of approximately $1.05 million and capital and reserve fund reserves of approximately $2.33 million. The recommended operating reserve target is 50 percent of annual operating costs plus one debt service payment, meaning current operating reserves are below the reserve target. Maintaining at least 25% of annual operating costs in reserves is in line with industry standards that recommend an operating reserve target to account for the time (at least 4 months) that it would take an agency to approve new rate increases to comply with Proposition 218. With the proposed revenue increases, it is projected the wastewater operations fund will meet the fund reserve target by the end of the fifth year.

5.3 Wastewater Capital Improvement Plan
Table 20 below provides the wastewater capital improvement plan (CIP) for all projects that will be funded through rates rather than impact fees. This rate study excludes projects funded by impact fees because they mitigate growth-related issues and should be funded by new development rather than existing ratepayers. The CIP includes funding for improvements to the City’s WWTP, new equipment, and annual repairs and replacements. The total funded over the rate study period is $7.43 million.

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Table 20: Wastewater Capital Improvement Plan (rate funded) City of Hanford
Utility Rate Study

Project Title FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 5-Year
Total
2104 Valley Alarm Access Control
WWTP
$15,230 - - - - $15,230
Utility Customer Payment Kiosks (2) $27,000 $14,000 $14,000 $14,000 $14,000 $83,000 Wwtp Improvement Reserve - $500,000 $500,000 $500,000 $500,000 $2,000,000 Unsch Main Exten/Repl-Wwtp $101,930 - - - - $101,930
Sewer System Video Insp $18,000 - - - - $18,000
Sewer Main Oversizing Req $92,180 - - - - $92,180
2073 Utility Truck - - $90,000 - - $90,000
2073 Pickup Truck $65,000 - - - - $65,000
2073 Vacuum Truck - - $600,000 - - $600,000
Lacey Blvd Widen Magna Carta to
13th
- - - $400,000 - $400,000
2071 Spare Barscreen Motor - - $40,000 - - $40,000
2071 Spare Motor Screw Pump - $40,000 - - - $40,000
1750 Public Works Enclosed
Warehouse
- - $101,000 - - $101,000
2071 Pickup Truck - $65,000 - $65,000 - $130,000
Lacey Widen/Recon/10th-Sierra $153,730 $245,550 $94,030 - - $493,310 Spare Pumps $92,640 - - - - $92,640
Manhole Repr/Coating Project $104,720 $75,000 $75,000 $75,000 $75,000 $404,720 Protective Grating $50,000 - - - - $50,000
2040 Fleet Div-Def Dispenser for
Fuel Island
$12,000 - - - - $12,000
Annual Repairs & Replacement - $500,000 $500,000 $500,000 $500,000 $2,000,000 Annual Lift Station Rehab - $150,000 $150,000 $150,000 $150,000 $600,000 Total Wastewater CIP $732,430 $1,589,550 $2,164,030 $1,704,000 $1,239,000 $7,429,010

5.4 Wastewater Cash Flow Projection
Table 21 provides the wastewater cash flow projection for the five-year period beginning in FY 2023/24 through FY 2027/28. The cash flow is based on the City’s FY 2023/24 and 2024/25 Budget and includes revenue increases such that the City covers operating and debt service costs, funds all proposed capital improvement projects, and rebuilds adequate reserves. The proposed revenue increases over the next five years are 35.0% in the first year, followed by 12.0%, 12.0%, 5.0%, and 5.0%. In the first year, the

35.0% increase is applied to the City’s total wastewater revenue increase and does not necessarily reflect the level of increase for individual customers. Each customer’s bill impacts will depend on customer class. The first rate increase is proposed to go into effect February 1, 2024, followed by subsequent increases effective each July 1 beginning in 2024 through 2027.

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5.4.1 Wastewater Revenues
As shown in Table 7, current wastewater rates are estimated to generate $5.3 million in revenues. For FY 2023/24, rate revenues are projected at $5.95 million assuming the City will collect rates at current revenues until the proposed rate increase goes into effect after February 1. Rate revenues are the main revenue source for the wastewater utility. Other revenue sources include penalty fees, interest income, and lease proceeds. These other sources generate about $154,000 annually, which is projected to remain constant over the next five years. In FY 2023/24, it is proposed that the stormwater fund lends the wastewater fund $1.3 million to eliminate the wastewater fund’s operating deficit.

5.4.2 Wastewater Expenses
The cash flow uses the City’s FY 2023/24 and 2024/25 Budget as the base for projected expenses. Most operating expenses are projected to increase 3.0% annually beginning in 2025/26, except for Salaries & Benefits which are escalated by 7.0% annually beginning in 2025/26. An additional $120,000 is also added to projected Salaries & Benefits in 2024/25 for a new position per City direction. The wastewater fund’s share of payments for the principle for the Pension Obligation Bond are included as a new expense. Annual depreciation is not included as a cash expense. Four equal installments of $325,000 beginning in FY 2024/25 through FY 2027/28 are included for the wastewater fund to pay back the interfund loan from the storm drain fund.

As shown in Table 20, the total five-year CIP for the wastewater fund equals $7.4 million. It is assumed the City will contribute $2 million upfront for the Wastewater Treatment Expansion Project, which is included in the CIP. The net operating cost increase for WWTP expansion is estimated at $165,000 annually beginning in FY 2025/26 based on projections by City staff.

5.4.3 Debt Service
It is also imperative that the wastewater fund generate sufficient rate revenues to maintain the debt service coverage ratio for its existing debt obligations. A debt service coverage ratio is a financial measure of an agency’s ability to repay outstanding debt. For the purposes of the City’s wastewater fund, the required debt service coverage ratio means that annual sewer net operating revenues (gross revenues less operating and maintenance expenses) must be at least 1.2 times the annual debt service payment. Failure to meet the debt service ratio on an annual basis is considered to be technical default.

Thus, rates and fees must be set to meet this legal requirement.

The wastewater utility currently has three outstanding debt obligations which count toward its debt service coverage requirements. There are two Wastewater Revenue Refunding Bonds, Series 2012 and Series 2015, in addition to a 2002 loan from the California Infrastructure and Economic Development Bank (IBank). The IBank loan is in the amount of $10 million with a 30-year term and an annual interest rate of 3.5%. In July 2012, the City issued the $13.165 million Wastewater Revenue Refunding Bonds, Series 2012 bearing interest of 3.0% to 5.0% payable semi-annually to refund Indentures from 1999 and 2002. In January 2015, the City issued the $3.885 million Wastewater Revenue Refunding Bonds, Series

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2015 to refund Variable Rate Demand Sewer System Refunding Revenue Bonds, 1996 Series A. Interest of 2.0% to 4.0% is payable semi-annually.

5.4.4 Five-Year Summary
Figure 7 graphically shows the wastewater cash flow projection for the five-year rate study period including both operating and capital expenses. In the first few years, expenses will slightly exceed revenues. At the end of the five-year period, the City’s revenues are projected to be in line with total expenses.

Figure 7: Wastewater Cash Flows

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Table 21: Wastewater Cash Flow Projection
City of Hanford
Utility Rate Study Years 1 -5: Proposition 218
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Rate Revenue Increase 35.0% 12.0% 12.0% 5.0% 5.0%
Rate Increase Effective Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 BEGINNING FUND BALANCE [1] $1,046,000 $1,452,000 $1,534,000 $1,553,000 $1,824,000 REVENUES Rate Revenues 5,954,000 8,405,000 9,414,000 9,885,000 10,379,000 Non-Rate Revenue Penalties 55,000 55,000 55,000 55,000 55,000 Interest Income 2,000 2,000 2,000 2,000 2,000
Lease & Other Fin Proceeds 93,000 93,000 93,000 93,000 93,000 Bad Debts 4,000 4,000 4,000 4,000 4,000
Subtotal Non-Rate Revenues 154,000 154,000 154,000 154,000 154,000 Interfund Loan 1,300,000 Total Revenue 7,408,000 8,559,000 9,568,000 10,039,000 10,533,000 EXPENSES Operating Expenses [2]
Treatment Division
Salaries and Benefits [3] 1,060,000 1,236,000 1,323,000 1,416,000 1,515,000 Supplies and Equipment 696,000 694,000 715,000 736,000 758,000 Outside Services 248,000 206,000 212,000 218,000 225,000 City Services Allocation 369,000 369,000 380,000 391,000 403,000 POB Principal [4] 142,000 139,000 139,000 139,000 145,000 Chemicals 435,000 435,000 448,000 461,000 475,000
Disposal 96,000 96,000 99,000 102,000 105,000
Utilities 511,000 511,000 526,000 542,000 558,000
WWTP Net Cost Increase [5] 0 0 165,000 165,000 165,000 Collections Division
Salaries and Benefits [3] 500,000 520,000 536,000 552,000 569,000 Supplies and Equipment 311,000 311,000 320,000 330,000 340,000 Outside Services 19,000 18,000 19,000 20,000 21,000 City Services Allocation 748,000 748,000 770,000 793,000 817,000 Chemicals 25,000 25,000 26,000 27,000 28,000
Utilities 68,000 68,000 70,000 72,000 74,000
Subtotal O&M 5,228,000 5,376,000 5,748,000 5,964,000 6,198,000 Net Operating Revenue 2,180,000 3,183,000 3,820,000 4,075,000 4,335,000

Debt Service
Rev Refunding Bonds, Series 2012 925,000 923,000 926,000 926,000 926,000 Rev Refunding Bonds, Series 2015 290,000 294,000 292,000 291,000 291,000 2002 IBank Loan 559,000 559,000 558,000 558,000 558,000 Subtotal Debt Service 1,774,000 1,776,000 1,776,000 1,775,000 1,775,000 Transfer to Capital Fund 0 1,000,000 1,700,000 1,704,000 1,239,000 Transfer to Repay Interfund Loan 0 325,000 325,000 325,000 325,000

Total Net Revenues (Operations Fund) 406,000 82,000 19,000 271,000 996,000

OPERATIONS ENDING BALANCE 1,452,000 1,534,000 1,553,000 1,824,000 2,820,000

Operations Reserve Fund Target [6] 2,610,000 2,621,000 2,647,000 2,672,000 2,700,000 Operating Reserve Target Met? no no no no yes

Debt Service Coverage (Target = 1.20x) [7] 1.23 1.79 2.15 2.30 2.44 Target Met? yes yes yes yes yes

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Years 1 -5: Proposition 218
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 CAPITAL & RESERVE BEGINNING FUND BALANCE [8] 2,325,000 1,593,000 1,003,000 539,000 539,000

Revenues
Transfer from Operations Fund 0 1,000,000 1,700,000 1,704,000 1,239,000

Capital Expenses
Capital Plan 732,000 1,590,000 2,164,000 1,704,000 1,239,000 Subtotal Capital Expenses 732,000 1,590,000 2,164,000 1,704,000 1,239,000

Net Revenues (732,000) (590,000) (464,000) 0 0

CAPITAL & RESERVE ENDING FUND BALANCE 1,593,000 1,003,000 539,000 539,000 539,000

1 - Estimated Wastewater Operations cash fund balance from City staff 2 - Does not include depreciation
3 - Escalated by 7% beginning in FY 2025/26
4 - Payment shown only includes principle. Interest is already included in FY 2023/24 budget. 5 - Net savings from WWTP plant (lease payments less electricity savings) 6 - Recommended target is 6 months O&M Expenses plus annual debt service cost. 7 - Net Operating Revenue divided by Total Debt Service 8 - Estimated Wastewater Capital & Reserve cash fund balance from City staff

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SECTION 6: WASTEWATER COST ALLOCATION AND RATE DESIGN
The revenue requirements detailed in the previous section determine the amount of revenue to be recovered from wastewater rates. The cost of service allocation determines how revenues will be recovered from customers based on their estimated impact on the wastewater system. Proposition 218 requires that agencies providing “property-related services” (including wastewater service) set rates and charges that are based on the cost of providing those services.

6.1 Wastewater Cost Allocation
The determination of the sewer flows, sewer loadings, and the revenue requirements of the wastewater utility provide the basis for performing the cost of service analysis. The concept of proportionate allocation to each customer class indicates that allocations should take into consideration the quantity of effluent a customer contributes in addition to the strength of sewer effluent.

The key factors used to assign wastewater utility costs are estimated effluent (flow) going to the wastewater treatment plant and effluent strengths, measured in biological oxygen demand (BOD) and suspended solids (SS). Higher levels of BOD or SS equate to increased treatment costs. The total revenue requirement shown in the wastewater cash flow projection is the net cost of providing service and is allocated to the flow, BOD, and SS parameters. These allocations are then used as the basis to develop unit rates for the sewer parameters and to assign costs to each customer class in proportion to the sewer services rendered.

Wastewater expenses are allocated to the following categories (a) Customer Service, (b) Flow, (c) Biochemical Oxygen Demand (BOD), and (d) Suspended Solids (SS).  Customer Service Costs: Customer service costs represent the fixed expenditures of the sewer utility, including personnel costs and overhead expenses.

 Flow Costs: Volume- or flow-related costs that vary with the total quantity of wastewater collected. Because most agencies do not meter wastewater discharges, metered water consumption is used to estimate contributed average wastewater volume units of service.

 Strength Costs: Strength-related costs are those expenditures associated with the additional handling and treatment of high strength sewer. Sewer strength is typically measured in BOD and SS. Increased levels of BOD or SS typically equate to increased treatment costs.

Table 22 provides the proposed cost allocation using FY 2023/24 as the test year. The budgeted expenses were allocated to each category based on how the City incurs each cost. The overall proposed allocation is 14.8% to customer service, 46.0% to flow, 19.6% to BOD, and 19.6% to SS.

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Table 22: Wastewater Cost AllocaƟon
City of Hanford
Utility Rate Study
Budgeted Expenses
Budget FY
2023/24
Customer
Service Flow BOD SS
Operating Expenses
Treatment Division
Salaries and Beneﬁts $1,060,000 25.0% 15.0% 30.0% 30.0% Supplies and Equipment $696,000 0.0% 50.0% 25.0% 25.0%
Outside Services $248,000 0.0% 50.0% 25.0% 25.0%
City Services AllocaƟon $369,000 25.0% 15.0% 30.0% 30.0% POB Principal $142,000 25.0% 15.0% 30.0% 30.0%
Chemicals $435,000 0.0% 0.0% 50.0% 50.0%
Disposal $96,000 0.0% 0.0% 50.0% 50.0%
UƟliƟes $511,000 0.0% 80.0% 10.0% 10.0%
Subtotal Treatment $3,557,000 $392,750 $1,116,450 $1,023,900 $1,023,900

Collections Division
Salaries and Benefits $500,000 0.0% 100.0% 0.0% 0.0%
Supplies and Equipment $311,000 0.0% 100.0% 0.0% 0.0%
Outside Services $19,000 50.0% 50.0% 0.0% 0.0%
City Services Allocation $748,000 50.0% 50.0% 0.0% 0.0% Chemicals $25,000 0.0% 100.0% 0.0% 0.0%
Utilities $68,000 0.0% 100.0% 0.0% 0.0%
Subtotal Collections $1,671,000 $383,500 $1,287,500 $0 $0

Composite Collection & Treatment 14.8% 46.0% 19.6% 19.6%

Non-Operating Expenses (5-Year Averages)
Revenue Refunding Bonds, Series 2012 $925,200 14.8% 46.0% 19.6% 19.6% Revenue Refunding Bonds, Series 2015 $291,600 14.8% 46.0% 19.6% 19.6% Capital Costs (5-year avg) $1,485,800 14.8% 46.0% 19.6% 19.6% Subtotal Non-OperaƟng $2,702,600 $401,280 $1,242,715 $529,302 $529,302 Total $7,930,600 $1,177,530 $3,646,665 $1,553,202 $1,553,202 Proposed Cost AllocaƟon % 100.0% 14.8% 46.0% 19.6% 19.6%

6.2 Wastewater Rate Design
The cost of service analysis calculated the revenue requirements for each customer class. The next step is rate design which determines how those revenue requirements are collected from each class based on their estimated impact on the sewer system. As part of the rate study process, the City reviewed its current rate structure. Sewer rates in California are typically charged as either a fixed charge per equivalent dwelling unit (EDU), a volume rate charged per unit of wastewater flow, or as a combination of both fixed and volume rates. Ultimately, this study recommends maintaining the current rate structure. The categories of charges and customer classes are proposed to remain the same, but the

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amounts charged to each customer will be updated based on the new cost of service and the adjusted allocation to each customer class.

6.3 Wastewater Flows
The City does not directly meter the sewer flow of individual utility accounts for non-industrial customers. However, water use can be used as a proxy for sewer flow. For residential customers, it is necessary to isolate low water use periods during the winter to estimate sewer flow to better estimate indoor-only water use. Many customers typically have higher water use in the summer due to irrigation water use which occurs outdoors and does not flow into the wastewater system.

Total system flows and pollutant loads by customer class are estimated in Table 23. Pollutant loads consist of biochemical oxygen demand (BOD) and suspended solids (SS). Single family residential flows are estimated as 8 ccf per month and multi-family residential flows are estimated as 6 ccf per month based on winter water usage data from 2021 and 2022. Non-residential flows are estimated based on billed flows from 2022 and 2023. The strength factors are based on industry standard estimates.

Table 23: Annual Sewer Flows & Loadings
City of Hanford
Utility Rate Study
Flow
Wastewater Strength
(mg/l) Wastewater Loadings (lbs)
Customer Class (ccf) BOD SS BOD SS Single Family 1,529,000 175 175 1,669,218 1,669,218 Multi Family 307,000 175 175 335,154 335,154

Metered Water [1]
Group A: Domestic 130,000 175 175 141,922 141,922
Group B: Low Strength 169,000 135 135 142,327 142,327 Group C: Medium Strength 13,000 300 300 24,329 24,329 Group D: High Strength 80,000 500 500 249,533 249,533

Industrial 194,000 Varies 33,269 27,119
Schools 21,000 175 175 22,926 22,926
Septage 1,000 3500 3500 21,834 21,834
Total 2,444,000 2,640,513 2,634,363 Mg/l – milligrams per liter; CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 1 - Metered Water Use Categories:

Group A - Domestic Strength: Mobile home parks, motels, public buildings, hospitals, nursing homes, churches, fraternal lodges, service stations and automotive centers Group B - Low Strength: Car washes, laundromats, retail, commercial and professional establishments Group C - Medium Strength: Mixed use commercial centers including food services with single water service Group D - High Strength: Restaurants, supermarkets, grocery stores, mortuaries

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6.4 Wastewater Rate Derivation
As noted in the cost allocation section, wastewater rates are determined based on customer service costs as well as the amount of wastewater flow and pollutants flushed into the sewer system.

6.4.1 Unit Cost Calculation
Total flow and pollutant loading estimates are used to derive unit costs for customer service, flow, BOD, and SS as shown below in Table 24. The total revenue requirement to be collected from rates is divided between each category according to the percentages derived in the cost allocation (Table 22). The revenue requirement for each category is then divided by the appropriate number of billing units from Table 23 to calculate a unit charge.

6.4.2 FY 2023/24 Rate Derivation
Table 25 details the rate derivation for proposed FY 2023/24 rates using the unit costs from Table 24.

The flow charge per ccf is based on the customer service and flow unit costs per ccf. The strength multipliers shown in Table 23 for each customer class are applied to the BOD and SS unit costs. For residential customers, the unit costs are applied to estimated monthly flows to derive a monthly fixed charge.

Table 24: Unit Cost CalculaƟon
City of Hanford
UƟlity Rate Study
Cost Allocation Total Cust. Serv. Flow BOD SS
Cost Allocation % 100.0% 14.8% 46.0% 19.6% 19.6%
FY2024 Rev. Requirement [1] $7,504,650 $1,114,300 $3,450,800 $1,469,800 $1,469,800 Billing Units 2,444,000 2,444,000 2,640,513 2,634,363 ccf/year ccf/year lbs/year lbs/year Rate $0.46 $1.41 $0.56 $0.56 $/ccf $/ccf $/lb $/lb

1 - 12 months of revenue with proposed rate increases

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City of Hanford Page 45 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 25: Sewer Rate CalculaƟon
City of Hanford
UƟlity Rate Study
Customer Class Flow (ccf) BOD SS Total

RESIDENTIAL (Per dwelling unit)
Single Family [1] $14.94 $4.86 $4.86 $24.67
Multi-Family/Duplex [2] $11.21 $3.65 $3.65 $18.51

NON-RESIDENTIAL
Metered Water (Per ccf) [3]
Group A: Domestic $1.87 $0.61 $0.61 $3.08
Group B: Low Strength $1.87 $0.47 $0.47 $2.81
Group C: Medium Strength $1.87 $1.04 $1.04 $3.95
Group D: High Strength $1.87 $1.74 $1.74 $5.34

Schools (per student ADA) [4] - - - $0.74
Septage (per 1,000 gallons) $2.50 $16.25 $16.29 $35.03 Industrial $1.87 - - $1.87
Figures in table are unrounded
1 - Estimated monthly single family flow is 8 ccf based on winter water use data 2 - Estimated monthly multi-family flow is 6 ccf based on winter water use data 3 - Per hundred cubic feet (ccf)
4 - Estimated flow per student is 6 gallons per day based on industry standard estimates

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City of Hanford Page 46 Water, Wastewater, and Stormwater Utility Rate Study 2023

6.4.3 Proposed Wastewater Rates
The five-year proposed wastewater rate schedule is provided below in Table 26. The rates for 2023/24 are based on the calculations in Table 25. For the following years, rates are escalated by the percentage increases shown in the cash flow projection (Table 21).

Table 26: Proposed Wastewater Rates City of Hanford
UƟlity Rate Study

Current PROPOSED
Customer Class Rates FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

RESIDENTIAL (Per dwelling unit)
Single Family $17.86 $24.67 $27.63 $30.95 $32.50 $34.13 Multi-Family/Duplex $16.93 $18.51 $20.73 $23.22 $24.38 $25.60

NON-RESIDENTIAL
Metered Water (Per ccf) [1]
Group A: Domestic $1.54 $3.08 $3.45 $3.86 $4.05 $4.25 Group B: Low Strength $1.44 $2.81 $3.15 $3.53 $3.71 $3.90 Group C: Medium Strength $2.15 $3.95 $4.42 $4.95 $5.20 $5.46 Group D: High Strength $2.88 $5.34 $5.98 $6.70 $7.04 $7.39

Schools (per student ADA) [2] $0.51 $0.74 $0.83 $0.93 $0.98 $1.03 Septage (per 1,000 gallons) $26.19 $35.03 $39.23 $43.94 $46.14 $48.45 Industrial
Flow (per mg) $1,561.56 $2,497.17 $2,796.83 $3,132.45 $3,289.07 $3,453.52 BOD (per lb) $0.173 $0.557 $0.623 $0.698 $0.733 $0.770 SS (per lb) $0.167 $0.558 $0.625 $0.700 $0.735 $0.772 1 - Per hundred cubic feet (ccf) 2 - ADA - average daily attendance

6.5 Wastewater Bill Impacts
Due to the updated cost of service allocation, the bill impacts to customers for the first year will vary based on customer class. Table 27 provides the percentage change in each rate category for each year of the rate study period. For FY 2023/24, the percentage change for each customer does not align with the percentage increase shown in the cash flow due to the reconfiguration of the cost allocation and the unit cost components used to calculate the rates. Following the first year, each customer’s monthly rate will increase as shown in the cash flow projection (Table 21).

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City of Hanford Page 47 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 27: Proposed Wastewater Rate Increases City of Hanford UƟlity Rate Study

Current PROPOSED
Customer Class Rates FY2023/24 FY2024/25 FY2025/26 FY2026/27 FY2027/28

RESIDENTIAL
(Per dwelling unit)

Single Family $17.86 $24.67 38% 12% 12% 5% 5%
Multi-Family/Duplex $16.93 $18.51 9% 12% 12% 5% 5%

NON-RESIDENTIAL
Metered Water (Per ccf) [1]
Group A: Domestic $1.54 $3.08 100% 12% 12% 5% 5%
Group B: Low Strength $1.44 $2.81 95% 12% 12% 5% 5%
Group C: Medium Strength $2.15 $3.95 84% 12% 12% 5% 5% Group D: High Strength $2.88 $5.34 85% 12% 12% 5% 5%

Schools (per student ADA) [2] $0.51 $0.74 44% 12% 12% 5% 5% Septage (per 1,000 gallons) $26.19 $35.03 34% 12% 12% 5% 5% Industrial
Flow (per mg) $1,561.56 $2,497.17 60% 12% 12% 5% 5%
BOD (per lb) $0.173 $0.557 221% 12% 12% 5% 5%
SS (per lb) $0.167 $0.558 234% 12% 12% 5% 5%
1 - Per hundred cubic feet (ccf)
2 - ADA – average daily aƩendance

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City of Hanford Page 48 Water, Wastewater, and Stormwater Utility Rate Study 2023

6.5.1 Residential Bill Impacts
Residential customers are proposed to have a bill increase from $17.86 per month to $24.67 per month, as shown in Figure 8. Figure 8 also shows the current monthly wastewater bills of other local agencies.

Despite the bill increase, the City’s monthly residential wastewater bill still remains on the lower end when compared to the surveyed agencies.

Figure 8: Monthly Single Family Residential Wastewater Bill Survey

6.5.2 Commercial Bill Impacts
For FY 2023/24, the bill impacts for commercial customers will depend on actual consumption and customer class. Table 28 includes a sample of commercial sewer bill impacts for each customer class at different levels of monthly water use.

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City of Hanford Page 49 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 28: Sample Monthly Non-Residential/Commercial Sewer Bill Impacts City of Hanford Utility Rate Study GROUP A: DOMESTIC STRENGTH Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 Domestic Strength - 15 ccf
Total Sewer Bill 15 $23.10 $46.20 $51.75 $57.90 $60.75 $63.75 $ Change $23.10 $5.55 $6.15 $2.85 $3.00
% Change 100.0% 12.0% 11.9% 4.9% 4.9%

Domestic Strength - 30 ccf
Total Sewer Bill 30 $46.20 $92.40 $103.50 $115.80 $121.50 $127.50 $ Change $46.20 $11.10 $12.30 $5.70 $6.00
% Change 100.0% 12.0% 11.9% 4.9% 4.9%

GROUP B: LOW STRENGTH
Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 Low Strength - 10 ccf
Total Sewer Bill 10 $14.40 $28.10 $31.50 $35.30 $37.10 $39.00 $ Change $13.70 $3.40 $3.80 $1.80 $1.90
% Change 95.1% 12.1% 12.1% 5.1% 5.1%

Low Strength - 20 ccf
Total Sewer Bill 20 $28.80 $56.20 $63.00 $70.60 $74.20 $78.00 $ Change $27.40 $6.80 $7.60 $3.60 $3.80
% Change 95.1% 12.1% 12.1% 5.1% 5.1%

GROUP C: MEDIUM STRENGTH
Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 Medium Strength - 30 ccf
Total Sewer Bill 30 $64.50 $118.50 $132.60 $148.50 $156.00 $163.80 $ Change $54.00 $14.10 $15.90 $7.50 $7.80
% Change 83.7% 11.9% 12.0% 5.1% 5.0%

Medium Strength - 50 ccf
Total Sewer Bill 50 $107.50 $197.50 $221.00 $247.50 $260.00 $273.00 $ Change $90.00 $23.50 $26.50 $12.50 $13.00
% Change 83.7% 11.9% 12.0% 5.1% 5.0%

GROUP D: HIGH STRENGTH
Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 High Strength - 70 ccf
Total Sewer Bill 70 $201.60 $373.80 $418.60 $469.00 $492.80 $517.30 $ Change $172.20 $44.80 $50.40 $23.80 $24.50
% Change 85.4% 12.0% 12.0% 5.1% 5.0%

High Strength - 100 ccf
Total Sewer Bill 100 $288.00 $534.00 $598.00 $670.00 $704.00 $739.00 $ Change $246.00 $64.00 $72.00 $34.00 $35.00
% Change 85.4% 12.0% 12.0% 5.1% 5.0%

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Hanford City CouncilNovember 7, 2023

Hanford City Council
November 7, 2023