Hanford City Council
January 16, 2024

City of Hanford Page 30 Water, Wastewater, and Stormwater Utility Rate Study 2023

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.

City of Hanford Page 31 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

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.
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%

City of Hanford Page 32 Water, Wastewater, and Stormwater Utility Rate Study 2023

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%

City of Hanford Page 33 Water, Wastewater, and Stormwater Utility Rate Study 2023

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.

City of Hanford Page 34 Water, Wastewater, and Stormwater Utility Rate Study 2023

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.

City of Hanford Page 36 Water, Wastewater, and Stormwater Utility Rate Study 2023

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.

City of Hanford Page 37 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

City of Hanford Page 39 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

City of Hanford Page 40 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

City of Hanford Page 41 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

City of Hanford Page 44 Water, Wastewater, and Stormwater Utility Rate Study 2023

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

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

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).

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

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.

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%

City of Hanford Page 50 Water, Wastewater, and Stormwater Utility Rate Study 2023

The commercial bill impacts to each customer class were also surveyed in comparison to other local agencies, see Figure 9. For each strength category, a sample level of water usage was chosen and compared to the corresponding charge that the same customer would face in another local agency.

Though all agencies surveyed charge variable rates per unit of water consumed by commercial customers, it should be noted that the subcategories used in other cities do not directly mirror those used by the City of Hanford. Some agencies do not have different charges based on wastewater strength, whereas others have more than four categories for commercial customers.

Figure 9: Commercial Monthly Wastewater Bill Surveys by Strength Category

City of Hanford Page 51 Water, Wastewater, and Stormwater Utility Rate Study 2023

SECTION 7: STORM DRAINAGE REVENUE REQUIREMENT
The storm utility’s cost of service and revenue requirement is comprised of operating costs, capital improvement costs, and the need to maintain reasonable reserves. Storm drain fees are intended to fund capital improvement programs, operations and maintenance, clean water programs to mitigate the pollutants in stormwater, and other environmental services related to storm water. Ongoing maintenance of storm drain pipes is important in reducing risks of flooding and sink holes in local neighborhoods.

7.1 Storm Drainage System Overview
The City operates and maintains a storm drainage system that covers the majority of the area within the City limits. The storm drainage system consists of 30 pump stations, 56 miles of pipeline ranging in size from 6 to 60 inches, 138 inverted siphons, 974 drainage inlets, and 181 acres of drainage basins and drainage ditches. The storm drainage system removes rainfall from surface streets and disposes of the accumulated stormwater in drainage basins and canals that are located throughout the City.

7.2 Storm Drainage Reserves
The City maintains two storm drainage reserve funds – 1) an operating fund reserve and 2) a capital reserve fund reserve. As of the beginning of FY 2023/24, the storm drainage utility had operations fund reserves of approximately $5.72 million and capital and reserve fund reserves of negative $730,000. The proposed fund balance target for the operations fund is equal to 50% of annual operating expenses per City policy. This is in line with industry standards that recommend an operating reserve target of at least 25% of annual expenses 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.

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 emergencies or other unexpected situations. The City can also choose to use reserves to smooth cash flows and mitigate impacts to ratepayers.

7.3 Storm Drainage Capital Improvement Plan
Table 29 provides the storm drainage utility’s capital improvement plan by year for the rate study period, totaling $3.58 million. All storm capital projects will be funded with rate revenues. Major projects include widening streets, removing trees, and repairing basins.

City of Hanford Page 52 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 29: Storm Drainage Capital Improvement Program (CIP) City of Hanford UƟlity Rate Study

Project Title FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 5-Year
Total
Courthouse Parking Lot
Reconstruction
- $310,000 - - - $310,000
Utility Customer Payment Kiosks (2) $27,000 $14,000 $14,000 $14,000 $14,000 $83,000 Houston Av Pipeline/Sand Slough $111,390 - - - - $111,390 Storm Drain Pump #39 $70,000 - - - - $70,000
Lacey Blvd Widen/Reconst Magna
Carta To 13th
- - - $500,000 - $500,000
2062 Lift Station Rehab - - $50,000 - - $100,000
2062 Portable Pumps 6" / 4" - $65,000 - - - $65,000
2050 Vacuum Truck (Repl 174) - $129,400 - - - $129,400
Tree Trim/Removal Program $75,000 $75,000 $75,000 $75,000 $75,000 $375,000 2062 Brown St Main Addition-Hwy
198 To Brown St Basin
- - $250,000 - - $250,000
1750 Public Works Enclosed
Warehouse
- - $75,000 - - $75,000
Lacey Widen/Recon/10th-Sierra $305,020 $487,210 $186,570 - - $978,800 Stonecrest Basin Pump Eq $45,930 - - - - $45,930
Lift Sta 23 & 56 Panel Repl $48,000 - - - - $48,000
Incr Flow Cap/People Ditch - $35,440 - - - $35,440
Gate Crossing Security/Locks $18,450 - - - - $18,450
Curb And Gutter Install $47,205 $20,000 $20,000 $20,000 $20,000 $127,205 Bonneyview Basin/Sand Slough Basin $256,200 - - - - $256,200 TOTAL STORMWATER CIP $1,004,195 $1,136,050 $670,570 $609,000 $159,000 $3,578,815

7.4 Storm Drainage Cash Flow Projection
The storm drainage fund cash flow for the five-year period beginning in FY 2023/24 through FY 2027/28 is provided in Table 30. Revenue increases of 5.0% annually over the rate study period are needed to keep up with operating cost inflation and to fund necessary capital projects. It should be noted that this level of increase is applied to the City’s total storm drainage fee revenues and does not necessarily reflect the level of increase for individual customers. The impacts to each customer will vary depending on customer class and parcel size.

7.4.1 Stom Drainage Revenues
The City’s main revenue source for the storm drainage utility is Storm Drain Fees. Fee revenues are estimated at about $1.48 million in FY 2023/24, comprising 97% of total storm drain revenues. Other revenues include Interest Income, Late Charges, and Other Miscellaneous Income.

City of Hanford Page 53 Water, Wastewater, and Stormwater Utility Rate Study 2023

7.4.2 Storm Drainage Operating Expenses
Operating expenses are based on the City’s FY 2023/2024 and 2024/2025 Budget. Major expenses include Salaries and Benefits, Administrative Expenses, Supplies and Equipment, Outside Services, and Utilities. Beginning in FY 2025/26, Salaries & Benefits are escalated by 7.0% each year while all other operating expenses are escalated by 3.0% annually. In total, storm drainage operating expenses are estimated to increase by 5.0% each year beginning in FY 2025/26 through FY 2027/28.

7.4.3 Loan to Wastewater Fund
The storm drainage fund will lend the wastewater fund $1.3 million in FY 2023/24 to eliminate the wastewater fund’s operating deficit and assist the wastewater fund with meeting its debt coverage requirements. The wastewater fund will pay back the loan in four equal installments of $325,000 beginning in FY 2024/25 through FY 2027/28.

7.4.4 Five-Year Summary
Figure 10 graphically shows the storm drainage cash flow projection for the five-year rate study period including both operating and capital expenses. The City will use existing reserves to fund capital projects and the interfund loan to the wastewater fund in FY 2023/24.

Figure 10: Storm Drainage Cash Flows

City of Hanford Page 54 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 30: Storm Drainage Cash Flow ProjecƟon City of Hanford UƟlity 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 5.0% 5.0% 5.0% 5.0% 5.0%
Rate Increase Effective Jan 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 BEGINNING FUND BALANCE [1] $5,721,000 $3,542,000 $2,708,000 $2,374,000 $2,053,000 REVENUES Rate Revenues 1,477,000 1,597,000 1,677,000 1,761,000 1,849,000 Non-Rate Revenue Late Fees 5,000 5,000 5,000 5,000 5,000 Interest Income 43,000 43,000 43,000 43,000 43,000
Bad Debts 1,000 1,000 1,000 1,000 1,000
Subtotal Non-Rate Revenues 49,000 49,000 49,000 49,000 49,000

Transfer from Wastewater to Repay Transfer 0 325,000 325,000 325,000 325,000

Total Revenue 1,526,000 1,971,000 2,051,000 2,135,000 2,223,000 EXPENSES Operating Expenses
Salaries and Benefits 581,000 600,000 642,000 687,000 735,000 Supplies and Equipment 317,000 316,000 325,000 335,000 345,000 Outside Services 71,000 71,000 73,000 75,000 77,000
City Services Allocation 381,000 381,000 392,000 404,000 416,000 Utilities 51,000 51,000 53,000 55,000 57,000
Subtotal O&M 1,401,000 1,419,000 1,485,000 1,556,000 1,630,000 Net Operating Revenue 125,000 552,000 566,000 579,000 593,000

Transfer to Capital Fund 1,004,000 1,386,000 900,000 900,000 900,000 Transfer to Wastewater for Interfund Loan 1,300,000 0 0 0 0 OPERATIONS ENDING FUND BALANCE 3,542,000 2,708,000 2,374,000 2,053,000 1,746,000

Operating Reserve Fund Target [2] 701,000 710,000 743,000 778,000 815,000 Operating Reserve Target Met? yes yes yes yes yes CAPITAL & RESERVE BEG. FUND BALANCE [3] ($730,000) ($730,000) ($480,000) ($251,000) $40,000 Revenues Transfer from Operations Fund 1,004,000 1,386,000 900,000 900,000 900,000 Capital Expenses Capital Plan 1,004,000 1,136,000 671,000 609,000 159,000 Subtotal Capital Expenses 1,004,000 1,136,000 671,000 609,000 159,000 Net Capital Revenues 0 250,000 229,000 291,000 741,000 CAPITAL & RESERVE ENDING FUND BALANCE ($730,000) ($480,000) ($251,000) $40,000 $781,000 1 - Estimated cash fund balance of Storm Drainage Operations Fund provided by City staff 2 - Recommended target: Operating Reserve target is 6 months O&M Expenses 3 - Estimated cash fund balances of Storm Drainage Capital and Reserve Fund provided by City staff

City of Hanford Page 55 Water, Wastewater, and Stormwater Utility Rate Study 2023

SECTION 8: STORM COST ALLOCATION AND RATE DESIGN
Proposition 218 requires that municipalities providing “property-related services” (including storm drain service) set rates and charges that are based on the cost of providing those services. The revenue requirements detailed in the previous section determine the amount of revenue to be recovered from the storm drain rates. In this section, the cost of service allocation develops an equitable means of allocating utility costs among its customers based on their estimated runoff burden to the storm drain system.

The primary storm drainage service provided by the City is the collection, conveyance, and management of stormwater runoff from parcels. All parcels2 that contribute runoff into the City’s system, either directly or indirectly, take stormwater service from the City. This service is needed due to property improvements resulting in impervious area such as rooftops, paved driveways and walkways, and landscaping that prevents storm water percolation into the ground. Open space, raw land, and agricultural parcels that are akin to natural conditions (i.e. percolation into the groundwater), are not charged a fee.

Another stormwater service provided by the City is compliance with water quality requirements through the City’s NPDES permit. The City monitors all parcels in the City including parcels that may drain directly to non-City receiving waters. Thus, all parcels are included in the fee structure except street parcels that are considered part of the storm system, open space or agricultural parcels that percolate stormwater, and parcels that full contain their own stormwater runoff.

8.1 Storm Drainage Cost Allocation
The proposed storm drain rate will only be levied on properties that shed water, directly or indirectly, into the City’s storm drain system. Moreover, the amount of use attributed to each parcel is proportionate to the amount of stormwater runoff contributed by the parcel, which is, in turn, proportionate to the amount of impervious surface area on a parcel. According to the California Storm Water Quality Association (CASQA), the most widespread storm water fee structure across the United States is based on the amount of impervious area on a parcel. Impervious surfaces are surfaces that allow little or no storm drainage to permeate into the ground, including rooftops, paved driveways, and walkways.

Measuring impervious area is conducted using aerial photography and geographic information system (GIS). For residential properties, a representative sampling is sufficient to determine an average for a typical single family parcel. Unlike residential parcels, non-residential parcels differ widely in size and characteristics which makes sampling impractical. For a simplified alternative, runoff coefficients can be used to estimate stormwater runoff by land use classification. This concept can be used to estimate the

2 Street parcels are considered part of the storm drain system and do not take service

City of Hanford Page 56 Water, Wastewater, and Stormwater Utility Rate Study 2023

relative load from a single parcel by multiplying the total area of the lot type by the runoff coefficient.

The City’s 2017 Storm Drainage Master Plan includes runoff coefficients by land use types.

Table 31 includes an estimate of impervious area within the City. Parcels within the City are divided into one of seven land use categories: 1) Single Family Residential, 2) Business, 3) Industrial, 4) Low Density, 5) Multi-Family Residential, 6) Public Agency, and 6) Schools. A runoff coefficient from the 2017 Storm Drainage Master Plan is applied to the acreage of each land use category to estimate the total land area that is impervious.

The Public Agency category refers to buildings and structures owned by governmental agencies and includes City Hall, City offices, libraries, post offices and fire/police stations. The Low Density category is new and is applied to industrially zoned parcels that were either a) entirely farmland, b) occupied by some industrial use but mostly vacant, or c) a single-family home that also contains active farmland. The properties in which parcel size is unknown will be charged a base fee based on customer class.

Additionally, the City has identified 68 potential industrial parcels that will be added to the total acreage count once they have been annexed into the City in the future. Parcels that meet any of the following conditions are excluded from Table 31 and are not proposed to be charged storm drain fees:

1) Parcels that solely comprise a street or roadway (either publicly or privately owned) and are considered to be part of the Storm Drain conveyance system. 2) Parcels comprised of an area which is part of the City’s storm drain system. 3) Parcels that do not receive service.
4) Parcels which detain all runoff on site.

To provide more context to exemption number 1 listed above, the Environmental Protection Agency notes that “a municipal separate storm sewer means a conveyance or system of conveyances (including roads with drainage systems, municipal streets, catch basins, curbs, gutters, ditches, man-made channels, or storm drains): (i) Owned or operated by a State, city, town, borough, county, parish, district, association, or other public body (created by or pursuant to State law)... that discharges into waters of the United States. (ii) Designed or used for collecting or conveying stormwater; (iii) Which is not a combined sewer; and (iv) Which is not part of a Publicly Owned Treatment Works (POTW) as defined at 40 CFR 122.2.” (EPA Stormwater Phase II Final Rule Fact Sheet). Therefore, street parcels are considered part of the City’s storm drain infrastructure. Street parcels are assumed to collect and convey their own onsite stormwater. Storm drain expenses incurred related to the service of street parcels are deemed to benefit all parcels of the City and these costs are spread among non-street parcels based on the cost allocation described in this section.

City of Hanford Page 57 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 31: EsƟmated of Acreage & Impervious Area City of Hanford UƟlity Rate Study

Service Type
Number
of Parcels
[1]
% of Total
Parcels
Total
Acres
Average
Parcel Size
(acres)
Runoff
Coefficient
[2]
Total
Impervious
Area
% of Total
Impervious
Area

R Residential 16,041 93.6% 3,047.8 0.19 0.50 1,523.9 57.8% B Business 559 3.3% 702.5 1.26 0.90 632.2 24.0%
I Industrial [3] 66 0.4% 281.9 4.27 0.80 225.5 8.6%
LD Low Density 31 0.2% 255.5 8.24 0.10 25.5 1.0%
M Multi-Family 397 2.3% 171.0 0.43 0.60 102.6 3.9%
P Public Agency 11 0.1% 104.7 9.52 0.90 94.2 3.6%
S Schools 29 0.2% 220.5 7.60 0.15 33.1 1.3%
Total 17,134 100.0% 4,783.9 2,637.1 100.0%

1 - Only includes storm accounts that have matched APNs 2 - Source: Storm Drainage Master Plan 2017
3 - Includes 50% of matched acreage to be conservative

8.2 Storm Drainage Fee Design
Table 32 allocates the annual revenue requirement from the storm drainage cash flow to each customer class using the percent of total impervious area to calculate the proposed storm drainage fees. Single family residential customers will continue to be charged on a “per account” basis, with the monthly fee being lowered from $5.04 to $4.57. The most common method of establishing storm drainage rates is to use the average single-family residential parcel size as the basic unit of measure. The single family residential fee is based on an average parcel size of 0.19 acres. All other customers will be charged on a “per acre” basis. Parcel size and impervious area are more indicative of the impact each customer places on the City’s storm drainage system.

For all other non-residential customers, the methodology in which these customers will be charged is based on parcel size, rather than consumption. Therefore, the actual bill impacts to each customer will vary depending on customer class and parcel size.

City of Hanford Page 58 Water, Wastewater, and Stormwater Utility Rate Study 2023

Table 32: Storm Drainage Fee CalculaƟon City of Hanford UƟlity Rate Study

FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

Total Revenue Requirement (from Cash Flow) [1] $1,520,820 $1,596,861 $1,676,704 $1,760,539 $1,848,566

Customer Class Allocation
% of Total
Impervious Area
Single Family Residential 57.8% $878,830 $922,771 $968,910 $1,017,355 $1,068,223 Business 24.0% $364,606 $382,837 $401,979 $422,078 $443,181 Industrial 8.6% $130,062 $136,565 $143,393 $150,563 $158,091 Low Density 1.0% $14,734 $15,471 $16,245 $17,057 $17,910 Multi-Family 3.9% $59,175 $62,134 $65,241 $68,503 $71,928 Public Agency 3.6% $54,339 $57,055 $59,908 $62,904 $66,049 Schools 1.3% $19,074 $20,027 $21,029 $22,080 $23,184 Total 100.0% $1,520,820 $1,596,861 $1,676,704 $1,760,539 $1,848,566

Rate Calculation for Single Family Residential
Total Revenue Requirement $878,830 $922,771 $968,910 $1,017,355 $1,068,223 Total Number of Residential Accounts 16,041 16,041 16,041 16,041 16,041 Monthly Single Family Residential Rate (per account) $4.57 $4.79 $5.03 $5.29 $5.55

Rate Calculation for Business
Total Revenue Requirement $364,606 $382,837 $401,979 $422,078 $443,181 Total Acres 702.5 702.5 702.5 702.5 702.5
Monthly Storm Drain Rate per Acre $43.25 $45.42 $47.69 $50.07 $52.57

Rate Calculation for Industrial
Total Revenue Requirement $130,062 $136,565 $143,393 $150,563 $158,091 Total Acres 281.9 281.9 281.9 281.9 281.9
Monthly Storm Drain Rate per Acre $38.45 $40.37 $42.39 $44.51 $46.73

Rate Calculation for Low Density
Total Revenue Requirement $14,734 $15,471 $16,245 $17,057 $17,910 Total Acres 255.5 255.5 255.5 255.5 255.5
Monthly Storm Drain Rate per Acre $4.81 $5.05 $5.30 $5.56 $5.84

Rate Calculation for Multi-Family
Total Revenue Requirement $59,175 $62,134 $65,241 $68,503 $71,928 Total Acres 171.0 171.0 171.0 171.0 171.0
Monthly Storm Drain Rate per Acre $28.84 $30.28 $31.79 $33.38 $35.05

City of Hanford Page 59 Water, Wastewater, and Stormwater Utility Rate Study 2023

FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28

Rate Calculation for Public Agency
Total Revenue Requirement $54,339 $57,055 $59,908 $62,904 $66,049 Total Acres 104.7 104.7 104.7 104.7 104.7
Monthly Storm Drain Rate per Acre $43.25 $45.42 $47.69 $50.07 $52.57

Rate Calculation for Schools
Total Revenue Requirement $19,074 $20,027 $21,029 $22,080 $23,184 Total Acres 220.5 220.5 220.5 220.5 220.5
Monthly Storm Drain Rate per Acre $7.21 $7.57 $7.95 $8.35 $8.76

1 – Assumes 12 months of rate increases

8.3 Cost Allocation Results
Based on the cost allocation, the revenue recovery by customer class has been updated so that each customer class is paying their share of costs per the total percentage of impervious area as shown on Table 31. Figure 11 below compares the current revenue allocation with the proposed allocations based on acreage.

Figure 11: Current vs. Proposed Storm Drainage Revenue Recovery

City of Hanford Page 60 Water, Wastewater, and Stormwater Utility Rate Study 2023

8.4 Proposed Storm Drainage Rates
The proposed five-year rate plan is shown in Table 33. The February 1, 2024 rates reflect the new cost allocation and rate structure described herein. The following years reflect 5.0% annual increases consistent with the proposed cash flow.

Table 33: Proposed Storm Drainage Fees City of Hanford UƟlity Rate Study

CURRENT

PROPOSED
Fiscal Year FY2023/24 FY2024/25 FY2025/26 FY2026/27 FY2027/28 Effective Date Jul 1, 2011 Feb 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 Jul 1, 2028

Single Family Residential (per account) $5.04 $4.57 $4.79 $5.03 $5.29 $5.55

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 accounts that the City does not have parcel size information for.

8.5 Storm Drainage Survey
Figure 12 provides a bill survey comparing the City’s current and proposed storm drain bills for a 1,700 square foot single family home.

City of Hanford Page 61 Water, Wastewater, and Stormwater Utility Rate Study 2023

Figure 12: Storm Drainage Residential Monthly Bill Survey

8.6 Annual Parcel Database Review
To develop the storm drainage parcel database, L&T matched the City’s current storm drainage accounts with parcel size information and assessor parcel numbers (APN) provided by Kings County. The City will need to make adjustments to the parcel database on an annual basis as parcels are developed, undergo a change of use, or when parcel size data becomes available for those without acreage currently available. The following accounts will need to be updated each year:

 Accounts with No Acreage
Of the 17,453 storm drainage accounts, L&T was able to match 14,489 with their corresponding acreage and APNs. Accounts without parcel size information will be charged a base storm drainage charge based on customer class. Once parcel size is confirmed, the account can be charged the corresponding per acre rate.

 Hand-Billed Industrial & School Accounts
The City currently bills several schools and industrial accounts separately for sewer use, and therefore, L&T did not find an existing account number. The City can either continue to hand bill these customers or add them to the billing system.

City of Hanford Page 62 Water, Wastewater, and Stormwater Utility Rate Study 2023

 Potential Industrial Parcels
The City has identified 68 industrial parcels for a total of 1,318 acres that will likely be annexed into the City in the future. Because it is unknown when they will be annexed, these parcels are not included in the current rate study but can be included in the next rate study once they have established a utility billing account.

 Low Density Parcels
The Low Density category is a new storm rate category and is applied to industrially zoned parcels that were either a) entirely farmland, b) occupied by some industrial use but mostly vacant, or c) a single-family home that also contains active farmland. The City has identified 31 Low Density parcels for a total of 511 acres. The majority of these parcels do not have an existing utility account number and will have to be added to the billing system.

 Site Planning & Impervious Area Reductions
Certain parcels may have storm water detention and/or retention facilities or perform other best management practices that decrease or eliminate storm water runoff. While every effort has been made to account for these parcels, a parcel owner may present information to substantiate an exemption to the charges. The City will need to establish a process for individual property owners to appeal their storm drain charges on a case-by-case basis and update the parcel database as needed.

City of Hanford
Utility Division
315 N Douty Street
Hanford, CA 93230

NOTICE OF PUBLIC HEARING ON PROPOSED WATER, WASTEWATER, & STORM DRAIN RATE INCREASES Hearing Date & Time: January 16, 2024 at 7pm
Hearing Location:

Hanford Civic Auditorium
400 N Douty Street
Hanford, CA 93230
Dear Customer or Property Owner,
You are receiving this notice because you are either a utility customer or you own property receiving services of the City of Hanford (City). The City Council will hold a public majority protest hearing on January 16, 2024, at 7pm at 400 N Douty Street, Hanford, CA 93230 to consider increases in the water, wastewater, and storm drain rates, effective February 1, 2024. At the hearing, the City Council will review the amount of the proposed rates as well as the methodology used to calculate the rates. If the proposed maximum rates are adopted, the City may collect rates at or below the proposed maximum as needed to meet the City’s water, wastewater, and storm drain needs over the next five years.

In compliance with article XIII D of the California Constitution, which was added to the Constitution pursuant to Proposition 218, this notice provides you with information regarding the services provided by the City, the reasons for the changes in the water, sewer, and storm drain service rates, and the methods by which you can protest this rate increase if you so desire.

System Overview
The City provides water, wastewater, and storm drain services to approximately 17,000 accounts including homes, businesses, and industrial facilities. The City’s sole water source is groundwater from within the San Joaquin Valley Groundwater Basin which is distributed through a system of wells, pipelines, storage reservoirs, and pumping facilities. The City owns and operates a local wastewater plant to treat and dispose of customer discharge. The storm drainage system removes rainfall from surface streets and disposes of the accumulated stormwater in drainage basins throughout the City. The City also complies with strict government clean water standards regulating the removal of pollutants from stormwater prior to it entering local waterways.

Current Water, Wastewater, & Storm Drain Rates
Water, wastewater, and storm drain rates are billed monthly. The prior water rate study was completed in 2015, and the last water rate increase went into effect over 5 years ago on July 1, 2018. For water service, customers are billed 1) a flat charge according to the size of their meter and 2) a volume rate based on metered water usage.

All customers pay a uniform volume rate that is the same rate per 100 cubic feet (ccf) of water consumed. One hundred cubic feet (ccf) equates to 748 gallons.

The prior wastewater and storm drain rate study was completed in 2009, and the last rate increases went into effect over 12 years ago on July 1, 2011. For wastewater and storm drain service, residential customers are billed a flat charge per account. Commercial customers are billed based on metered water use. Industrial customers are billed based on metered water use and for the amount of pollutants released into the wastewater system.

Schools are billed annually based on a flat charge per student (measured using average daily attendance).

Why are rate adjustments needed?
The water, wastewater, and storm drain utilities rely entirely on rate revenues to fund operations. The proposed rates are based on a comprehensive cost of service study to ensure that utility rates pay for increasing operating and maintenance expenses, debt service payments, capital projects, and emergency reserves. Water, wastewater, and storm drain operations are not funded by property tax or any other tax revenue.

The proposed rate increases are needed for the three utilities to maintain balanced budgets and to fund necessary infrastructure improvements. Water rates are proposed to be adjusted to keep up with inflationary cost increases and to fund $43.7 million in capital projects over the next five years. Major water capital projects include meter replacements, well upgrades, tank repairs, and water supply projects.

In recent years, the wastewater utility has spent down its reserves to fund expenses. Wastewater rate increases are needed to keep up with operating costs, maintain strong debt coverage, and to fund $7.4 million in capital projects over the next five years. Major wastewater capital projects include funding for the wastewater treatment expansion project, lift station repairs, and rehabilitating miles of sewer pipeline.

The proposed storm drain rate increase reflects needed improvements to the City’s aging storm drainage system, including $3.5 million in capital projects over the next five years. Major storm drainage capital projects include removing trees, basin repairs, and pipeline replacements.

Proposed Rates and Rate Structure Adjustments
The proposed rates are designed to cover the costs of planned capital projects and operating and maintenance expenses and will not result in any profits to the City. Current and proposed water rates are provided in Table 1.

Table 1: Current and Proposed Monthly Water Rates
Current
Rates [1]

PROPOSED
Fiscal Year 2023/24 2024/25 2025/26 2026/27 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
CCF - hundred cubic feet; one CCF = 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.

The proposed water rates also include a schedule of drought rates, which would only be implemented during a water shortage emergency. The City does not currently have a schedule of drought rates. Under drought conditions, the meter charges would remain the same, but the volume rate would increase according to the level of water cutback, as shown in Table 2. A detailed analysis of drought rates is provided in the City’s Water, Wastewater, and Stormwater Utility Rate Study 2023.

Table 2: Proposed Drought Rates
Current
Rates
PROPOSED [1]
Fiscal Year 2023/24 2024/25 2025/26 2026/27 2027/28
Effective Date July 1, 2018 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027 DROUGHT CONSUMPTION CHARGES ($/CCF) [1]
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 CCF = 748 gallons
1 - Only to be implemented temporarily during water shortage emergencies.

Current and proposed wastewater rates are provided in Table 3. It should be noted that under the current billing system, wastewater and storm drain fees are combined into a single charge. 22% of the combined charge is for storm drain services. For a single family customer, the current combined fee is $22.90 per month which is made up of $17.86 for wastewater service and $5.04 for storm service. In the future, wastewater and storm rates are broken out into separate charges. Wastewater rates are determined based on customer service costs as well as the amount of wastewater flow and pollutants flushed into the sewer system.

Table 3: Current and Proposed Monthly Wastewater Rates
Current PROPOSED
Customer Class Rates 2023/24 2024/25 2025/26 2026/27 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 (Per CCF)
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) [1] $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
No storm drain fees are included in this table.

CCF - hundred cubic feet; one CCF = 748 gallons
1 - ADA - average daily attendance

Non-residential Sewer Customer Groups are defined as:

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

Current and proposed storm drain rates are provided in Table 4. The proposed storm drain rates are based on land use type and parcel size as these parameters more closely reflect how customers generate stormwater runoff and take service from the City’s storm drain system. 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 base charge according to their customer class. It should be noted that street parcels contain culverts, drains, and other stormwater facilities and are thus considered part of the storm drain system and are not billed for service.

Table 4: Current and Proposed Monthly Storm Drain Rates

Current PROPOSED
Rates 2023/24 2024/25 2025/26 2026/27 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
(per account) $5.04 $4.57 $4.79 $5.03 $5.29 $5.55

ALL OTHER CUSTOMERS (per acre)
Business
varies
$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
varies
$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

No wastewater fees are included in this table.
1 - Parcels with indeterminate acreage will be billed a base charge according to their customer class.

Parcels that meet any of the following conditions are not proposed to be charged storm drain fees:

1. Parcels that solely comprise a street or roadway (either publicly or privately owned) and are considered to be part of the Storm Drain conveyance system per Environmental Protection Agency guidelines.

2. Parcels comprised of an area which is part of the City’s storm drain system.

3. Parcels that do not receive service.

4. Parcels which detain all runoff on site.

How do I file a protest or participate in the public hearing? The provisions of Proposition 218 provide that certain types of “Property Related Fees” such as water, sewer, and storm drain rates are subject to a “majority protest” process. Under the majority protest process, any property owner or customer of record may submit a written protest for the proposed increases; provided, however, that only one protest will be counted per identified parcel. If protests are filed on behalf of a majority of the parcels subject to the rates, the City cannot adopt the proposed rates.

Every written protest MUST include ALL of the following to be counted:

1. A statement against the proposed water rates, wastewater rates, storm drain rates or all three rates;

2. Name of the recorded owner or customer of record who is submitting the protest;

3. Identification of assessor’s parcel number, street address, or utility account number of the parcel with respect to which the protest is made; and

4. Original signature and legibly printed name of the record owner or customer of record who is submitting the protest.

Written protests may be submitted by:

1. Mail to - Prop 218 Protest, 315 N Douty Street, Hanford, CA 93230; or

2. In-person delivery during normal business hours to 315 N Douty Street, Hanford, CA 93230; or

3. In-person at the Public Hearing, prior to the conclusion of the Public Hearing.

Regardless of how the written protest is submitted, it must be received by the City prior to the conclusion of the public comment portion of the Public Hearing on January 16, 2024. (Postmark dates will not be accepted.) Any protest submitted via e-mail or other electronic means will not be accepted. Please identify on the front of the envelope for any written protest, whether mailed or submitted in person to the City, that the enclosed protest is for the Public Hearing on the Proposed Water, Wastewater, and Storm Drain Rate Increases. Oral comments at the Public Hearing will not qualify as formal protests unless accompanied by a written protest.

The City will hold the Public Hearing on January 16, 2024 at 7pm. The City Council will review the amount of the rates as well as the methodology for calculating the proposed rates. At the conclusion of the hearing, protests will be counted and validated. If protests are filed on behalf of a majority of the parcels subject to the rates before the end of the Public Hearing, the City cannot adopt the proposed rates. If a majority of the parcels do not protest the proposed increase, the City has the authority to adopt the proposed rates. The first rate change, if enacted, could go into effect as early as February 1, 2024.

Additionally, pursuant to California Government Code 53759, there is a 120-day statute of limitations for challenging any new, increased, or extended fee, adopted, modified, or amended after January 1, 2022.

Notice of a Public Hearing on Proposed Water, Wastewater, and Storm Rate Increases The City of Hanford will hold a Public Hearing on the proposed water, wastewater, and storm drain rates on Tuesday, January 16, 2024 at 7:00 p.m. in the Hanford Civic Auditorium at 400 N Douty Street, Hanford, CA 93230

RESOLUTION NO. 24-02-R

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HANFORD UPDATING

WATER RATES
At a regular meeting of the City Council of the City of Hanford duly called and held on the 16th day of January 2024, it was moved by Council Member , seconded by Council Member , and carried that the following resolution be adopted:

WHEREAS, Chapter 13 of the Hanford Municipal Code provides for the fixing of water, wastewater and stormwater rates by resolution for residential and commercial services; and
WHEREAS, the consulting firm Lechowicz and Tseng Municipal Consultants prepared a comprehensive analysis and written report entitled “Water, Wastewater, and Stormwater Utility Rate Study 2023”, dated November 7, 2023; and
WHEREAS, the City Council conducted a study session reviewing the proposed rates on November 6, 2023; and
WHEREAS, notice of the proposed water, wastewater and stormwater rates was mailed to all property owners and customers in accordance with the requirements of Proposition 218 and Government Code section 53750 et seq; and
WHEREAS, a public hearing to consider the proposed rates and any protests to such rates was held on this date, January 16, 2024, which is more than 45 days after the notices were mailed; and
WHEREAS, written protests to the proposed rates were not presented by a majority of the customers; and
WHEREAS, the proposed rates are required to cover the cost of providing the various services, including but not limited to, providing funds for operations, capital improvements, debt service and vehicle replacement costs; and
WHEREAS, the proposed rates are non-discriminatory and do not exceed the cost of providing services for which the rates are imposed; and WHEREAS, the City Council deems it in the public interest to adjust the w a t e r rates as set forth in the attached Exhibit “A” known as the City of Hanford Water, Wastewater, and Stormwater Utility Rate Study 2023.

WHEREAS, the City Council will look to consider wastewater and stormwater rates in future action.

NOW, THEREFORE, BE IT FURTHER RESOLVED to continue the public hearing for wastewater and stormwater rates until February 6, 2024; NOW, THEREFORE, BE IT RESOLVED that the rates on Exhibit “A” are approved, effective February 1st, 2024; and thereafter as specified, on July 1, 2024; July 1, 2025; July 1, 2026; and July 1, 2027.

PASSED, ADOPTED AND APPROVED this 16th day of January 2024 by the following vote:

AYES: __________________________
NOES: __________________________
ABSTAIN: __________________________
ABSENT: __________________________
_______________________
Travis Paden
MAYOR of the City of Hanford
Attest:
_______________________
Natalie Corral
City Clerk

16.A.

AGENDA

STAFF REPORT

MEETING DATE: 1/16/2024 AGENDA SECTION: GENERAL BUSINESS

SUBJECT:

Discussion regarding the list of committees and boards that have City Council representation directly appointed by the Council and Appointment of those members as appropriate.

RECOMMENDATION:

Recommendation: That the City Council receive and discuss the list of committee and boards that have City Council representation directly appointed by the Council and approve the Appointments as recommended by a vote of the full Council.

BACKGROUND:

Staff regularly presents the City Council representation list at the December meeting after the council reorganization. The updated list was not complete at that time. The City Clerk updated the list to include only the boards, commissions, and committees that require Council representation and that the Council has appointing authority over and should make assignments as needed.

There are two list included in the staff report for the Council's review. The 2023 Council Representation on Boards, Commissions, Committees list represents the appointments that were made during the Special Meeting held on December 2, 2022, and the other list is an updated list minus the boards and committees listed below. An updated list was created because the Hanford City Council does not have authority to make appointments or assignments for the boards and committees that were removed. Also, staff does not have a recommendation at this time for the vacancy on the Kings Mosquito Abatement District Board. The District Manager, Michael Cavanagh, will provide a candidate recommendation to the City Clerk as soon as possible, and it will be added to a future agenda for the Council’s approval.

Boards/Committees Member/Rep Appointing Authority
City Selection Committee

Mayor (Meeting dates
vary)
Members of the City Selection Committee
are by statute the City Mayors of each City
within Kings County.

SJV Air Pollution Control Dist.

Citizens Advisory Committee

Kalish Morrow Appointed by the City Selection Committee Local Agency Formation
Commission (LAFCO)
(4th Wednesday of each month 3:30
p.m.)

City Member Primary #1
(Exp. 2025)
Sid Palmerin (Corcoran)
City Member Primary # 2
(Exp. 2024)
Alvaro Preciado (Avenal)

The City Selection Committee

League of California Cities
(2nd Thursday, odd months –
Executive Committee)
(2nd Thursday, even months –
Division Meeting)

Kings County
representation:

Patricia Matthews,
Lemoore
The board positions are elected via
membership election.

Kings County Coordinating Task
Force
Mayor (As needed)

Travis Paden The City County Coordinating Committee is assigned to the sitting Mayors of each city.

Kings County Homeless
Collaborative
Mark Kairis The Board of Supervisors
San Joaquin Joint Powers
Authority
Diane Sharp
Alternate Rep
Kings County Association of Governments
TPC

Additionally, two committees were removed and are not listed; the Cross Valley Rail Joint Powers Authority Committee and the San Joaquin Valley Task Force Steering Committee. The Cross Valley Rail Joint Powers Authority Committee is not an active committee and the San Joaquin Valley Task Force Steering Committee does not exist. The San Joaquin Valley Air Pollution District does have Steering Committees, but none that serve Kings County.

Staff recommends that the Council review the new updated list and advise the Mayor of any specific interest in a particular committee. Interest should be expressed regardless of whether a current vacancy exists, or if a Council Member is currently a member of a particular committee and no longer wishes to serve in that capacity, the Council member should notify the Mayor that they are no longer interested.

The mayor will then make a recommendation to the full Council regarding which representatives will serve on the various boards and committees for the 2024 term.

FISCAL IMPACT:

No fiscal impact.

ATTACHMENTS:

1. 2023 COUNCIL REPRESENTATION

2. 2024 COUNCIL REPRESENTATION

2024 COUNCIL REPRESENTATION ON BOARDS,

COMMISSIONS, COMMITTEES
Organization Primary
Appointment
Alternate
Appointment
Kings Economic Development Corporation
(Last Monday each month – 11:30 am)
Kalish Morrow Travis Paden
Kings County Association of Governments
(4th Wednesday each month – 4:30 pm)
Requires Form 700
Kalish Morrow Travis Paden
Kings County Area Public Transit Agency (KART)
(4th Wednesday each month – 1:30 pm)
Requires Form 700
Diane Sharp Travis Paden
Kings County Abandoned Vehicle Authority
(Meets as needed/4th Wednesday each month – 4:30 pm)
Requires Form 700
Kalish Morrow Diane Sharp
Kings Community Action Organization (KCAO)
(3rd Wednesday each month - 4:30 pm)
Requires Form 700
Lou Martinez Travis Paden
Kings Waste and Recycling Authority (KWRA)
(2nd Wednesday each month - 8:00 am)
Requires Form 700
Diane Sharp Lou Martinez
Mid-Kings River Groundwater Sustainability Agency
(2nd Tuesday of each month – 1:00 pm)
(Alternate not required)
Requires Form 700
Diane Sharp Mark Kairis
Kings County Area Disaster Council
(Meets 2-3 times a year)
Director of Emergency Services, Fire Chief, or the City Manager Travis Paden Mark Kairis
Kings County Commission On Aging
(3rd Thursday each month – 2:30 pm) Community Member
The City Council’s within Kings County shall appoint one person each.

Susie Chavez
Kings Mosquito Abatement District Board
(3rd Thursday of each month – 9:00 am)
One (1) member from each of the three (3) cities (Corcoran, Hanford, and Lemoore) 3 Year Term
VACANT
(Exp. 12/31/2026

2024 COUNCIL REPRESENTATION ON BOARDS,

COMMISSIONS, COMMITTEES
Organization Primary
Appointment
Alternate
Appointment
Kings Economic Development Corporation
(Last Monday each month – 11:30 am)
Kalish Morrow Travis Paden
Kings County Association of Governments
(4th Wednesday each month – 4:30 pm)
Requires Form 700
Kalish Morrow Travis Paden
Kings County Area Public Transit Agency (KART)
(4th Wednesday each month – 1:30 pm)
Requires Form 700
Diane Sharp Travis Paden
Kings County Abandoned Vehicle Authority
(Meets as needed/4th Wednesday each month – 4:30 pm)
Requires Form 700
Kalish Morrow Diane Sharp
Kings Community Action Organization (KCAO)
(3rd Wednesday each month - 4:30 pm)
Requires Form 700
Lou Martinez Travis Paden
Kings Waste and Recycling Authority (KWRA)
(2nd Wednesday each month - 8:00 am)
Requires Form 700
Diane Sharp Lou Martinez
Mid-Kings River Groundwater Sustainability Agency
(2nd Tuesday of each month – 1:00 pm)
(Alternate not required)
Requires Form 700
Diane Sharp Mark Kairis
Kings County Area Disaster Council
(Meets 2-3 times a year)
Director of Emergency Services, Fire Chief, or the City Manager Travis Paden Mark Kairis
Kings County Commission On Aging
(3rd Thursday each month – 2:30 pm) Community Member
The City Council’s within Kings County shall appoint one person each.

Susie Chavez
Kings Mosquito Abatement District Board
(3rd Thursday of each month – 9:00 am)
One (1) member from each of the three (3) cities (Corcoran, Hanford, and Lemoore) 3 Year Term
VACANT
(Exp. 12/31/2026

16.B.

AGENDA

STAFF REPORT

MEETING DATE: 1/16/2024 AGENDA SECTION: GENERAL BUSINESS

SUBJECT:

Council discussion and selection of Council members to be part of the interview panels that are necessary to fill the upcoming City Commission vacancies.

RECOMMENDATION:

Recommendation: That the City Council discuss the existing vacancies and appoint one (1) Council member, to serve along with the Mayor and the staff liaison to each commission, as the interview panel to fill the current vacancies for each respective City Commissions.

BACKGROUND:

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

"Members of all commissions shall be appointed by the mayor with the approval of a majority of the members of the city council."

In previous years, vacancies have been filled by a variety of methods including, a recommendation from the Council liaison, interviews by the full council and interviews by a combination of the Mayor and another Council member and staff, but there has never a formal process.

This year, at the direction of the Mayor, staff has been tasked with creating a formal interview process with a separate panel for each Commission that will include the Mayor, one (1) other Council member and the staff liaison for each respective commission.

Those panels will then interview prospective applicants and then bring back recommendations for the full council to consider for appointments to the commissions.

FISCAL IMPACT:

ATTACHMENTS:

None

16.C.

AGENDA

STAFF REPORT

MEETING DATE: 1/16/2024 AGENDA SECTION: GENERAL BUSINESS

SUBJECT:

Settlement Agreement Darlene Mata v. City of Hanford, Art Brieno

RECOMMENDATION:

Recommendation: It is recommended that the City Council approve the settlement with Darlene Mata and direct staff to take all necessary action to carry out the terms of the settlement.

Recommended Motion: I move to approve the Settlement Agreement and Release of All Claims regarding the lawsuit filed against the City by Darlene Mata and that City staff be authorized and directed to carry out the terms set forth in the Settlement Agreement and Release of All Claims.

BACKGROUND:

Ms. Mata, the City’s former Community Development Director, alleged several complaints against former Councilmember Art Brieno, including harassment based on gender, harassment based on actual and/or perceived disability, hostile work environment harassment, invasion of privacy, disclosure of Constitutionally protected privacy interests, improper disclosure of medical information, disclosure of confidential personnel information, retaliation, and false light.

Upon receipt of those complaints, the City engaged an outside investigator who conducted several interviews and found the complaints to be sustained. Following the report findings, Mr. Brieno was censured by the City Council. The censure served as the Council’s statement that it did not condone Mr. Brieno’s conduct.

Ms. Mata later filed the present suit against the City. The parties engaged in discovery, and subsequently attended mediation. Through mediation, the parties came to an agreement for settlement of this matter. Settlement includes the payment of $750,000 to Ms. Mata in exchange for dismissal of the action against the City and Mr. Brieno. Prior to filing her lawsuit, Ms. Mata identified her estimated damages at approximately $1,433,483.83 and initially indicated a willingness to settle for $1,250,000.

The City is a party to the matter, so acceptance is conditioned on Council approval. However, PRISM, the City’s insurer, has already approved the settlement amount and will refund that amount and fees and costs incurred by the City in this matter in excess of the City’s $100,000 self-insured retention (aka deductible).

FISCAL IMPACT:

The City’s self-insured retention is $100,000 and PRISM will pay the portion of the settlement, fees,

and costs in excess of that amount.

ATTACHMENTS:

1. 2024.01.04 Mata General Release (Final)

SETTLEMENT AGREEMENT AND RELEASE OF ALL CLAIMS

This Settlement Agreement and Release of all Claims (hereinafter “Agreement”) is made and entered into by Darlene Mata (“Plaintiff”), on the one hand, and City of Hanford (“City”) and Art Brieno (“Brieno”) (collectively “Defendants”) on the other hand.

WHEREAS, on or about March 16, 2022, Plaintiff filed a Complaint for Damages, and a First Amended Complaint on August 15, 2022. Generally, Plaintiff alleged harassment and discrimination based on gender and disability, retaliation, failure to prevent harassment, discrimination and retaliation, and various violations of her privacy (the “Civil Action”) in Kings County Superior Court, Case No. 22C-0077;

WHEREAS, Defendants dispute any wrongdoing or unlawful actions and/or liability whatsoever and specifically disclaim any liability on the part of itself/himself or any past or present officer, manager, agent, employee, or representative;

WHEREAS, the Parties now wish to formally and finally document the resolution of this dispute:

NOW, THEREFORE in consideration of the promises set forth below, the Parties agree as follows:

1. Payment to Plaintiff. In consideration for the Parties’ execution of this Agreement and their full and complete compliance with all covenants and promises herein, City shall pay Plaintiff the total gross settlement amount of Seven Hundred Thousand Dollars and Zero Cents ($700,000.00) (the “Settlement Payment”) . Payment shall be made as follows: Five Hundred Thousand Dollars and Zero Cents ($500,000.00) made payable to the HPB Client Trust Account , and Two Hundred Thousand Dollars and Zero Cents ($200,000.00) made payable to Plaintiff. The Settlement Payment will not be taxed by City, and Plaintiff will receive IRS Form 1099 from City reflecting the $200,000.00 settlement payment.

(a) Plaintiff agrees the payment set forth in Paragraph 1 shall constitute the entire consideration prov ided to h er under this Agreement and , excluding any workers’ compensation claims that have been or could be made, she will not seek any further compensation for any other claim, damage, costs or attorneys’ fees in connection with the matters encompassed in this Agreement, or in connection with Plaintiff’s employment with City and any of the claims asserted, or which could have been asserted, against Defendants in the Civil Action.
(b) The Parties specifically agree the Settlement Payment made to Plaintiff through this Settlement Agreement only compensates Plaintiff for injuries and damages that are wholly separate from and specifically exclude injuries and damages covered through workers’ compensation claims. The Parties specificall y agree and acknowledge the Settlement Payment

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno made to Plaintiff through this Settlement Agreement specifically and intentionally does not intend and does not compensate Plaintiff for any benefits or payments she previously received, or will receive from any existing workers’ compensation claims. No po rtion of the Settlement Payment made to Plaintiff by way of this Settlement Agreement shall be deemed to supplant, and does not supplant any benefit received, or to be received, by Plaintiff through workers’ compensation. In the event any request or demand is made of Plaintiff to repay some or all the workers’ compensation benefit made to Plaintiff, or to be made to Plaintiff, regardless of who is making the request, the Parties agree this will serve as a complete defense to such request or demand. The City agrees to and shall fully defend and indemnify Plaintiff from any such claim so that Plaintiff shall not be required to repay any benefits received or to be received through workers’ compensation.

2. Release. The Parties, for herself/itself/himself, their executors, beneficiaries, successors, assignees, immediate family members, and any other person or entity who could now or hereafter assert a claim in her/its/his name or on behalf of herself/itself/himself (the “Releasing Party”) , hereby releases and forever discharge s the the other Party(ies) and their subsidiaries, officers, directors, members, partners, owners, shareholders, employees , former employees, agents, servants, attorneys, insurers, assigns, affili ates, independent contractors, volunteers, predecessors, successors, related legal entities, parent companies and organizations, insurers, and any and all other persons, firms and corporations in which they have an interest (collectively the “Released Part ies”), from any and all past, present, or future claims, lawsuits, demands, actions, or causes of actions (collectively “Claims”), which the Releasing Party now has, owns, or holds, or claims to have, own, or hold, or which each at any time heretofore had owned or held, or claimed to have had, owned, or held, against the Released Parties, up to the date of execution of this Agreement. The scope of what the Releasing Party releases in this Agreement includes, but is not limited to, a full general release, excluding workers’ compensation claims, of any and all Claims or potential Claims the Releasing Party may have against the Released Parties, for any and all injunctive relief, declaratory relief, physical injury, personal injury, and injury of any and all other kinds, and/or any and all other kinds of alleged damages, or other monetary obligation, or obligation of any other sort, including but not limited to, any and all compensatory damages, emotional distress damages, punitive damages, costs, attorneys’ fees, and any and all other kinds of damages that are based in whole or in part on any act or omission occurring before this Agreement becomes effective.

3. Waiver of Section 1542. The Parties expressly waives all claims, known or unknown, and expressly waives any rights under California Civil Code section 1542 which provides as follows:

A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settleme nt with the debtor or released party.

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno

4. Confidentiality. Strict confidentiality is a material term of this Agreement.

Accordingly, to the fullest extent allowed by law, the Parties agree as follows:

(a) Defendants shall not disclose any of Plaintiff’s alleged or actual medical information or medical records that were produced and/or discovered through the Civil Action.

(b) Nothing in this Agreement prohibits the disclosure of factual and related information regarding alleged sexual assault, sexual harassment, workplace harassment or discrimination based on sex, failure to prevent sex discrimination or harassment in the workplace, or retaliation for reporting sexual harassment or discrimination in the workplace.

Nothing in this Agreement shall be read to waive Plaintiff’s right to testify in an administrative, legislative, or judicial proceeding concerning alleged criminal conduct or alleged sexual harassment by Defendants or by Defendants’ agents or employees, when Plaintiff has been required or requested to attend the proceeding pursuant to court order, subpoena, or written request from an administrative agency or the legislature.

(c) The confidentiality provisions in this Paragraph 4 do not apply to responses required under the California Public Records Act, or disclosures required pursuant to the Ralph M. Brown Act or other otherwise required by law.

5. Non-Disparagement and Employment Reference . Defendants agree that it/he shall make no negative statements about Plaintiff, Plaintiff’s performance, or conduct to any third person or entity, unless compelled to do so by law. City agrees that if it receives a request for an employment reference from a prospective employer of Plaintiff, City shall only provide the prospective employer with information regarding Plaintiff’s dates of employment and job titles.

Employee-directed inquiries under this Paragraph shall be made only to Mario Cifuentez at (559) 585-2516.

6. No Admission of Liability. The Parties acknowledge this Agreement is a compromise of all disputed claims and that nothing in this Agreement constitutes or will be treated by any Party as an admission of liability or wrongdoing. This Agreement shall be binding upon, inure to the be nefit of, and be enforceable by, the Parties and their heirs, beneficiaries, administrators, representatives, executors, successors and assignees.

7. Age Discrimination in Employment Act and Older Worker’s Benefit Protection Act Release. Plaintiff understands and agrees that included among the Released Claims are all claims or rights Plaintiff may have as of the date Plaintiff signs this Agreement under the Age Discrimination in Employment Act (“ADEA”), and Plaintiff further understands and agrees that she:

(a) has reviewed all aspects of this Agreement;
(b) has carefully read and fully understands all the provision of this Agreement;

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno (c) understands that in agreeing to this document, she is releasing Defendants from any and all claims she may have against Defendants and its/his successors, assigns, agents, attorneys, and insurance carriers;
(d) knowingly and voluntarily agrees to all the terms set forth in this Agreement;
(e) was advised and hereby is advised in writing to consider the terms of this Agreement and consult with attorneys of Plaintiff's choice prior to executing this Agreement; (f) has up to twenty -one (21) days within which to consider this Agreement before executing it;
(g) has a full seven (7) days following the execution of this Agreement to revoke the Agreement, and has been and hereby is advised in writing that this Agreement shall not become effective or enforceable until the revocation period has expired; (h) acknowledges that she is receiving consideration from Defendants to which she is otherwise not entitled; and,
(i) understands that rights or claims under the Age Discrimination in Employment Act of 1967 (29 U.S.C. § 621, et seq.) that may arise after the date of this Agreement is executed are not waived.

The calendar day on which Counsel for City is in possession of both of the following shall be the Effective Date of this Agreement, unless Plaintiff revokes this Agreement prior to that date: (1) Plaintiff’s executed copy of this Agreement; and, (2) Plaint iff’s executed ADEA waiver attached hereto as Exhibit “A.” This Agreement shall not become effective, and Defendants shall have no obligation to perform under this Agreement, if Plaintiff revokes the Agreement pursuant to Paragraph 7(g) of this Agreement.

8. Right to Engage in Protected Activity . Nothing in this Agreement, including but not limited to the acknowledgments, release of claims, proprietary information, confidentiality, cooperation, and non-disparagement provisions, limits or affects Plaintiff’s right to challenge the validity of this Agreement, prevents Plaintiff from filing a charge or complaint with or from participating in an investigation or proceeding conducted by the Equal Employment Opportunity Commission, Public Employment Relations Board, National Labor Relations Board, the Securities and Exchange Commission, or any other any federal, state or local agency charged with the enforcement of any laws, including providing documents or any other information, or limits Plaintiff from exercising rights under Section 7 of the National Labor Relations Act to engage in protected, concerted activity with other employees, although by signing this Agreement, Plaintiff is waiving rights to individual relief (including backpay, front pay, reinstatement or other legal or equitable relief) in any charge, complaint, or lawsuit or other proceeding brought by Plaintiff or on Plaintiff’s behalf by any third party, except for any right Plaintiff may have to receive a payment from a government agency (and not City) for information provided to the government

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno agency or otherwise where prohibited.

9. Dismissal. Within five (5) business days of receipt of the full Settlement Payment, Plaintiff shall dismiss the Civil Action, with prejudice.

10. Governing Law. This Agreement shall be governed and will be construed in accordance with the laws of the State of California. The terms of this Agreement are contractual and not a mere recital.

11. Entire Agreement and Severability. This Agreement sets forth the entire agreement and understanding between the Parties on the subject matter hereof, and supersedes all prior discussions and negotiations between them. This Agreement may be amended, modified, or supplemented only by a written instrument executed by the Parties. Should any of the provisions of this Agreement be declared or be determined by any court to be illegal, void, invalid, or unenforceable by a court of competent jurisdiction, the validity of the remaining parts, terms or provisions shall not be affected, and the illegal or invalid part, term or provision shall not be deemed a part of this Agreement. It is the intention of the Parties that if any term or provision of this Agreement is capable of two constructions, one of which would render the term or provision valid, then the term or provision shall have the meaning that renders it valid.

12. Consultation with Counsel. Each Party acknowledges representation by counsel and/or the reasonable opportunity to be represented by counsel throughout all negotiations that preceded the execution of this Agreement and that this Agreement is executed with the consent of the Parties, whether or not represented . Each Party acknowledges that no person or entity, including but not limited to a party or agent or attorney of any Party, ha s made any promise, representation, or warranty, express or implied, not contained in this Agreement to induce the other party to execute this Agreement. Each Party has read this Agreement, accepts and agrees to the provisions it contains, and hereby executes it voluntarily with full understanding of its consequences. It is agreed that for purposes of interpreting the meaning of this Agreement, the Agreement should be deemed to have been jointly and mutually prepare d in its entirety by all Parties.

13. Breach of Agreement. In the event that any Party breaches any portion of this Agreement, the prevailing Party in an action to enforce this Agreement shall recover from the other Party the prevailing Party’s attorneys’ fees and costs.

14. Counterparts. This Agreement may be executed in separate counterparts, and by facsimile, and each such counterpart shall be deemed an original with the same effect as if all Parties had signed the same document.

15. C.C.P. § 664.6. This Agreement shall be binding upon each of the Parties hereto and is admissible into evidence to enforce its terms pursuant to Section 664.6 of the California Code of Civil Procedure and any equivalent federal law.

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno

16. Further Assurances. The Parties each agree to make, execute, and deliver such other documents, and to undertake such other and further acts as may be reasonably necessary to carry out the intent of this Agreement.

17. Construction. Headings are used herein for convenience only and shall have no force or effect in the interpretation or construction of this Agreement. As used in this Agreement, the singular shall include the plural, the masculine, the feminine and neutral genders. The above- stated Recitals are incorporated into this Agreement by this reference.

18. Waiver/Invalid Provision. Should any term, clause or provision of this Agreement be found to be waived or invalid, the validity of the remaining terms, clauses and provisions shall not be affected.

19. Fair Reading. This Agreement is a result of the negotiations between the Parties, and will not be construed strictly against or in favor of any Party hereto. The Parties intend that this Agreement will be given a fair reading and reasonable construction in accordance with the intentions of the parties and without regard to, or aid of Section 1654 of the California Civil Code.

20. Authority to Execute Agreement. Plaintiff represents and warrants that she has the sole right and exclusive authority to execute this A greement on h er behalf, that she understands the nature, quality and effect of signing this Agreement and that she has not sold, assigned, transferred or conveyed or otherwise dispensed of any claim or demand relating to her relationship with City, or any other matter covered by this Agreement. The individuals signing this Agreement on behalf of the Defendants represent and warrants that he/she has authority to do so.

21. No Further Action. Plaintiff represents that , except for any workers’ compensation claims, she has not filed any pending complaints, claims, lawsuits, or actions against Defendants, or Defendants’ officers, board of directors, agents, supervisors, employees, independent contractors, attorneys or representatives, insurers, or related or affiliated companies or entities or the Released Parties with any state, federal, or local agency, court, or any other forum, alleging any claim, liability, or cause of action against Defendants arising out of the relationship between the Parties based upon facts known or unknown which Plaintiff has occurred prior to the date of this Agreement. Plaintiff agrees that she will not do so at any time hereafter, and that if any agency or court assumes or mai ntains jurisdiction of any complaint, claim, lawsuit, or action against Defendants or any of Defendants’ affiliated companies or entities or any of their officers, board or directors, committees, members, agents, supervisors, employees, attorneys, insurers, or representatives or the Released Parties on behalf of Plaintiff, she will direct that agency or court to withdraw from or dismiss the matter with prejudice.

22. No Inducement. Plaintiff agrees that if the facts with respect to which this Agreement is executed are found hereafter to be different from the facts now believed by Plaintiff, Plaintiff expressly accepts and assumes the risk of such possible difference in facts, and agrees that this Agreement shall remain effective, notwithstanding such differences. Plaintiff

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno declares and represents that this Agreement is entered into voluntarily and that no promise, inducement or other agreement not expressly contained herein has been made to induce this Agreement.

23. Successors. This Agreement shall inure to the benefit of each Party hereto, its predecessors, successors, subsidiaries, affiliates, representatives, assigns, agents, officers, directors, employees and personal representatives, past, present and future.

24. Medicare and Social Security. This settlement is based upon a good faith determination of the Parties to resolve a disputed claim. The Parties have attempted to resolve this matter in compliance with both state and federal law, and it is believed that the settlement terms adequately consider and protect Medicare’s interest and do not reflect any attempt to shift responsibility of past or future medical treatment to Medicare in contravention of 42 U.S.C. § 1395y(b).

The Parties acknowledge and understand that any present or future action or decision by the Centers for Medicare & Medicaid Services (“CMS”) on this settlement, or Plaintiff's eligibility or entitlement to Medicare or Medicare benefits, will not render this release void or ineffective, or in any way affect the finality of this liability settlement.

Plaintiff represents and warrants that Plaintiff is not currently a Medicare beneficiary nor within thirty (30) months of becoming a Medicare beneficiary; is not 65 years of age or older; is not suffering from end stage renal failure or amyotrophic lateral sclerosis; has not received Social Security benefits for 24 months or longer; and has not applied for Social Security benefits, and/or has not been denied Social Security disability benefits and appealed/appealing the denial.

Because the Plaintiff is not a Medicare beneficiary as of the date of this release, no conditional payments have been made by Medicare.

Further, because Plaintiff is not expected to become a Medicare beneficiary within thirty (30) months from the date of this release, no funds have been allocated for future incident - related medical treatments.

In the event that any of the above information provided by Plaintiff is false or in any way incorrect, Plaintiff shall be liable for any and all actions, causes of actions, penalties, claims, costs, services, compensation or the like resulting from these inaccuracies. Plaintiff acknowledges that Medicare may require Plaintiff to exhaust the entire settlement proceeds on future Medicare - covered incident-related medical expenses should he/she become a Medicare beneficiary within thirty (30) months from the date of this release.

Plaintiff specifically waives any claims for damages against Defendants, including a private cause of action provided in 42 U.S.C. § 1395y(b)(3)(A), should Medicare deny coverage for any reason, including the failure to establish a set aside allocation of the settlement proceeds to protect Medicare’s interest. Plaintiff, and in accord with this release, agree s that any and all

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno applicable medical and other liens related to this claim or lawsuit are to be paid out of the settlement proceeds, and that Medicare conditional payments and any other liens related to this claim or lawsuit are to be paid out of the settlement proceeds, an d that Medicare conditional payments and any other lien claims are the sole responsibility of Plaintiff, with nothing further to be sought from Defendants. In the event this information is false or in any way incorrect, Plaintiff expressly warrants and agrees that said Medical conditional payments and liens will be Plaintiff 's sole responsibility and will be paid from these settlement proceeds with nothing further to be sought from Defendants.

Plaintiff agrees to fully indemnify, defend and hold Defendants harmless from any and all claims, liens and rights to payment, known or unknown, including but not limited to, penalties, Medicare conditional payments, liens, demands, and actions in law or equity arising out of the 42 U.S.C. § 1395y(b)(3)(A), including but not limited to, failure to satisfy all Medicare conditional payments or other liens and any action by CMS alleging that Medicare’s interests were not considered in this settlement.

If any governmental entity, or anyone acting on behalf of any governmental entity, seeks damages including multiple damages from Defendants relating to payment by such governmental entity, or anyone acting on behalf of such governmental entity, relating to Plaintiff 's alleged injuries, claims or lawsuit, Plaintiff will defend and indemnify Defendants, and hold Defendants harmless from any and all such damages, claims, Medicare conditional payments, liens, and rights to payment, including any attorneys’ fees sought by such entities.

Plaintiff further agrees to waive any and all future actions pertaining only to Medicare against Defendants, including but not limited to, any private cause of action for damages pursuant to 42 U.S.C. § 1395y(b)(3)(A).

25. Certification of Understanding . Plaintiff certifies this Agreement has been explained to her by the representative of her choosing or she has voluntarily and knowingly waived such right. Plaintiff also certifies that she understands and has voluntarily agreed to all the terms of this Agreement.

(Plaintiff’s initials: _______________).

SIGNATURES APPEAR ON FOLLOWING PAGE

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno IN WITNESS THEREOF, the Parties have executed this Agreement by their signatures below.

Darlene Mata, Plaintiff

By: _____________________________
Darlene Mata

Dated:___________________________

City of Hanford, Defendant

By: _______________________________

Its:________________________________

Dated:______________________________

Art Brieno, Defendant

By: _______________________________
Art Brieno

Dated:______________________________

Settlement Agreement and Release: Darlene Mata/City of Hanford and Art Brieno EXHIBIT “A”

WAIVER OF RIGHTS OR CLAIMS UNDER THE
AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967

Darlene Mata (hereinafter referred to as “Plaintiff”) knowingly and voluntarily signed the Settlement Agreement and Release of All Claims (hereinafter referred to as “Agreement”) on January ___, 2024. Plaintiff agrees and acknowledges that she has met wit h her attorney and understands that by signing this Agreement she is waiving all rights, claims, or causes of action she may have under the Age Discrimination In Employment Act of 1967 (29 U.S.C. § 621, et seq.) against the Parties signatory to this Agreement.

Plaintiff agrees and acknowledges that she has had a full seven (7) days following the execution of the Agreement to revoke the Agreement and that she has been advised in writing that this Agreement would not become effective or enforceable until the revoc ation period expires on January ___, 2024.

Plaintiff hereby acknowledges that the seven (7) day revocation period expired as of January ___, 2024, and she is hereby knowingly and voluntarily waiving her right to revoke this Agreement.

Date: January ___, 2024

__________________________________________
Darlene Mata

Council Future Agenda Items
Originated
Date Item Originator Staff Lead Date Estimate
8/15/2023 Municipal Code Amendments to
modify the chapter related to murals
and consider and adopt a policy to
approve murals at the administrative
level.

Council
Direction
Jason Waters 2/6/2024
12/5/2023 Presentation regarding the Operation
and Programs for the Longfield
Community Center.

Council
Consensus
Brad Albert 2/6/2024
12/5/2023 Appointment of members to the City’s
Revenue Measure Committee
Council
Consensus
Various Staff Special meeting in
Late January