City Council Meeting
Agenda
February 6, 2024
7:00 PM – Regular Meeting
Council Chambers
400 N. Douty St.
Council Members will meet in-person in the Council
Chambers. The meeting will also be lived streamed on the City’s website: http://livestream.hanford.city/
4:00 PM CALL TO ORDER STUDY SESSION AND CLOSED SESSION:
ROLL CALL BY THE CITY CLERK:
PUBLIC COMMENT:
Study Sessions are considered Special Meetings under the Brown Act. Accordingly, comments from the public are limited to items listed on the agenda (GC 54954.3a). Public Comment will be accepted during each agenda item. A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.
STUDY SESSION:
A. Presentation to the City Council regarding the Operation and Programs for the Longfield Community Center and Direction from Council regarding future uses and improvements as appropriate.
B. Community Development: Presentation and Council discussion and Input regarding the City's RAISE Grant Application project scope that will provide infrastructure improving walkability, safety and sustainability in the downtown and nearby alleys.
CLOSED SESSION FOR DISCUSSION OF THE FOLLOWING:
A. CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION (GC 54956.9)(d)(1))
1 Workers Compensation Claim.
B. CONFERENCE WITH LEGAL COUNSEL-ANTICIPATED LITIGATION (54956.9 (d)(2))
3 Potential Cases.
CALL TO ORDER REGULAR SESSION:
ROLL CALL:
INVOCATION:
Sheri Winterowd
FLAG SALUTE:
RECOGNITION:
A. Recognition of the invocation volunteers:
Mark Curts, Sylvia Gaston, Bobby Guerra, Johnny Escalara, Ignacio Valddez, John Malogi, Jay Rublacava, Lori Niles, Albert Toralez, Rich Johnson, Bud Haskell, Shannon Brown, Tim Brown, Andrea Lott, and Sherri Winterowd.
B. Badge Pinning Ceremony and Oath of Office for Officer Daniel Ortega.
CLOSED SESSION ACTION REPORT:
COUNCIL REPORTS/GENERAL REPORTS:
Brief information-only reports from City Council and/or Staff, including committee reports and reports by City Council related to meetings attended at City expenses (AB1234).
PUBLIC COMMENT:
This is the time for citizens to comment on subject matters within the jurisdiction of the Hanford City Council. This is also the public’s opportunity to request an item from the Consent Calendar be pulled for discussion purposes or to comment on any item on the agenda. State law does not allow the Council to discuss or take action on issues not on the agenda, except that members of the Council or staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights (Gov. Code sec. 54954.2). A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.
CONSENT CALENDAR:
Consent Calendar items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made and then the item will be removed from the Consent Calendar to be discussed and voted upon by a separate motion.
A. Procedural Waiver: Waive reading in full of resolutions and ordinances and approval and adoption of same by reading title the only.
B. Administration: Approval of Supplemental Services Agreement No. 1 with Brandley Engineering for the preparation and completion of a detailed Pavement Maintenance Management Plan/Pavement Evaluation Study for the Hanford Municipal Airport for a contract amount Not to Exceed $170,000, to be funded 95% through Federal and State grants.
C. Administration: Approval of a new 3-year Service Agreement with Main Street Hanford at an annual compensation amount of $81,090, which remains unchanged from the previous contract.
D. Community Development: Adoption of Resolution No. 24-04-R Approving an Amendment to the Standard Agreement issued under the 2020 Community Development Block Grant Program Coronavirus Response (CDBG-CV)
E. Public Works: Approval of an increase to the Purchase Order for the purchase of fuel for
City-owned equipment and vehicles, from Van Der Pol Enterprises up to $80,000 annually
F. Public Works: Appropriate $193,902 from the Refuse Fund (0307) and approve sole source awards for the purchase of various sized front load refuse plastic commercial bins from Toter LLC in the amount of $74,074.26 and various metal commercial bins from Wastquip in the amount of $119,827.15 due to the familarity of both vendors and the City of Hanford's refuse bin specifications.
G. Police: Approval of the Hanford Police Department's Canine Conditions of Acceptance contract between the City of Hanford and the Department's Canine Handlers, and Authorization for the Police Chief to execute the Agreements.
H. Finance: Authorization for the City Manager to execute an agreement with Wells Fargo Bank for banking and Lockbox services at an annual cost of approximately $135,000 for a term of three years, with an option to extend by two years.
I. Finance: Acceptance and authorization for staff to File the City of Hanford's Quarterly Investment Portfolio and Transactions Reports as of 12/31/2023.
PUBLIC HEARING:
A. Public Works: Public Hearing and consideration of approval of Resolution 24-03-R for City of Hanford wastewater rate adjustments effective March 1, 2024.
B. Community Development: Public Hearing to receive comments on the proposed Zone Text Amendment No. 2024-01, a request to amend Title 17, Section 17.56.230 of the Hanford Municipal Code in order to comply with free speech requirements and establish a new application process for murals and Introduction of Ordinance 24-01, approving the ZTA.
CONVENE AS SUCCESSOR AGENCY:
SUCCESSOR AGENCY - PUBLIC COMMENT:
SUCCESSOR AGENCY FOR THE DISCUSSION OF THE FOLLOWING:
A. Finance: Review And Approval Of The Recognized Obligation Payment Schedule (ROPS 24-25) For The Period July 1, 2024 To June 30, 2025.
ADJOURN AS THE SUCCESSOR AGENCY:
GENERAL BUSINESS:
A. Public Works: Authorization to reimburse Woodside 06N, LP, in the amounts of $546,798.00 for the city park land acquisition and improvements for the city neighborhood park located within Tract No. 929, Unit No. 1; AND $94,189.10 for the purchase and dedication of right of way and street improvements on 13th Avenue located outside of development boundaries; AND approve an additional appropriation of $546,798.00 from the Parks Impact Fee Fund, and $94,189.10 from the Transportation Impact Fee Fund to fulfill the reimbursements; AND approve an additional appropriation of $12,800.00 from the Park Impact Fee Fund for Parks Department staff to provide and install solar powered safety lighting and a drinking fountain at Tract 929 neighborhood park.
B. Public Works: Authorization to reimburse Presidio JJR Sterling Oaks 104, LLC in the amount of $672,607.51 for the City Park land acquisition and park improvements located within Tract No. 865, Unit No. 1; and approve an additional appropriation of $522,607.51 from the Parks Impact Fee Fund to fulfill reimbursements.
C. Finance: Introduction of Ordinance No. 24-01, Amending Municipal Code 2.48 relating to the City's Purchasing System
D. Administration: Discussion of Council Options and direction from the City Council Action related to the upcoming vacant Council seat in District C.
ITEMS FOR FUTURE AGENDAS:
At this time, any Council Member may ask a question for clarification or may request a matter, which is not otherwise scheduled on a City Council agenda, to be placed on a future agenda. The Council Member referring the item shall provide sufficient information as to the nature of the item. The City Council, by concurrence of a majority, may direct the City Manager to put the item on a future agenda. (GOV. CODE SEC. 54954.2) A. Council Future Agenda Items
B. Upcoming Events and Important Dates:
February 19: City offices closed in observance of Presidents' Day February 20: Regular City Council Meeting
March 5 & 19: Regular City Council Meeting
ADJOURNMENT:
Materials related to an item on this Agenda submitted to the City Council after distribution of the agenda packet are available to public inspection in the City Clerk’s Office located at 319 N. Douty Street, Hanford, California 93230, during normal business hours. Such agendas are also available at the city’s website, www.cityofhanfordca.com subject to staff’s ability to post the agenda before the meeting.
If you need a disability-related modification or accommodation, including auxiliary aids or services, to participate in this meeting, please contact the City Clerk’s office, 559-585-2515, 319 N. Douty Street, Hanford, California 93230, at least 2 days prior to the meeting {28 CFR 35.102.35.104 ADA Title II}
4.A.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: STUDY SESSION
SUBJECT:
Presentation to the City Council regarding the Operation and Programs for the Longfield Community Center and Direction from Council regarding future uses and improvements as appropriate.
RECOMMENDATION:
Recommendation: That the City Council receive a presentation on the Longfield Center and the current programmed uses of the facility and provide direction to staff regarding the future programming of the Longfield Center.
Recommended Motion:
BACKGROUND:
History
The Longfield Center has special meaning to those with roots in South Hanford. In 1955, the City of Hanford purchased a Catholic Church on the corner of 2nd Street and Douty Street for $3,072 (see picture below).
The Original Longfield Center on 2nd and Douty Streets
The more than 50-year history of the Longfield Center includes a long line of mentors. The lobby at Longfield is adorned with the faces of the Longfield Hall of Fame, who have given back to the community in many ways. The Longfield Center has traditionally been a drop-in facility for young people during weekends and after-school hours.
The Longfield Center became outdated as the years passed, due to the many years of community use. In 2021, with direction from the newly formed Longfield Advisory Committee, the City undertook a major renovation of the building's interior. This included new flooring, paint, a front lobby remodel, a renovated Hall of Fame display, and a new fitness center equipped with modern cardiovascular and strength equipment.
Established in 1994 by the City of Hanford, the Longfield Center Hall of Fame Inductee Ceremony is a biennial event. To be considered and inducted into the Hall of Fame, individuals must be viewed as role models in the community, have attended local schools, have been recognized for roles in academics, athletics, or professional organizations, and have been directly or indirectly involved with the Longfield Center. The committee that selects the honorees is made up of former inductees and city staff members.
The Longfield Hall of Fame Display
The current Longfield Recreational Programming, during the 2023 calendar year, resulted in the Longfield Center being open to the public for at total of 4,307 hours, at an annual cost to the City's General Fund of $226,993. The table and pie chart below show the types of uses and allocation of hours:
Percent of Programming at the Longfield Center
Camps
The City has offered day camp experiences to youth ages 5-14 for over twenty-five years. These camps provide structured recreation and enrichment opportunities during non-school times, totaling 13 weeks annually: Summer Camp - nine weeks, Winter Camp-- three weeks, and Spring Camp- one week. In 2023, 168 youths attended camps. These camps benefit working parents during non-school times. During the 2023 calendar year, 168 youth attended camps, generating $48,459 in revenue. In addition, the City offers financial assistance to disadvantaged families funded by the Community Development Block Grant (CDBG). In 2023, 21 families received this assistance, totaling $9,650.
In years past, camps were located within the Civic Auditorium East Wing (old Teen Center) and, more recently, in the Coe Park Building. In 2022, the City leased the Civic East Wing to the Kings County Office of Education (KCOE) to house the Hanford Family Resource Center, serving youth ages 0-5 and their parents free of charge. Last year, the Family Resource Center served 355 unduplicated children and 307 parents/guardians. The KCOE lease generates $51,960 in annual revenue.
This past year, the City received almost $2.5 million in grant funding to establish and operate the Hanford Boys & Girls Club at Coe Park for the next 5 years. This new STEM-based club will serve youth from grades 7-12, including many of those youth that have traditionally used the Longfield Center for drop-in. The addition of these two youth-serving programs has necessitated that the day
camps be relocated to the Longfield Center.
Active and Passive Recreation
A significant aspect of the Longfield Center's recreational programming is the choice of active and passive recreational activities. Historically, The Longfield Center has been a drop-in center focusing on passive recreation. As time passed and the City's recreational needs evolved, staff concentrated on balancing passive and active (hybrid) programming.
Solution
The critical area within the Longfield Center is the gymnasium, which houses six basketball hoops, including two full courts and one large court. A physical solution is the installation of a power drop- down net that would divide the gym in half (see pictures below). This divider net would improve programming flexibility and enable two user groups to coexist in the split space. This would give drop-in basketball uninterrupted play while providing opportunities for other user groups.
The motorized gym divider would be funded through the Prop 64 Grant (Hanford Boys & Girls Club) housed at Coe Park, allowing Club members to use the Longfield gym concurrently with drop-in basketball.
Sample Gym Dividers
Up Position
Retracted Position
FISCAL IMPACT:
The motorized gym divider would be funded through the Prop 64 Grant (Hanford Boys & Girls Club) housed at Coe Park, allowing Club members to use the Longfield gym concurrently with drop-in basketball. The estimated cost of the gym divider is $35,500, with no financial impact on the general fund.
ATTACHMENTS:
None
4.B.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: STUDY SESSION
SUBJECT:
Presentation and Council discussion and Input regarding the City's RAISE Grant Application project scope that will provide infrastructure improving walkability, safety and sustainability in the downtown and nearby alleys.
RECOMMENDATION:
Recommendation: That the City Council receive the staff presentation and provide input and receive public comments related to the City's RAISE Grant application which will provide infrastructure improving walkability, safety and sustainability in the downtown and nearby alleys.
BACKGROUND:
The Federal RAISE Grant provides ~$1.5 billion annually for infrastructure improvements that emphasize "safety, equity, climate and sustainability, and workforce development". The City is seeking approximately $13-18 million in RAISE Grant funds for infrastructure that improves walkability, safety and sustainability in the downtown and nearby alleys.
The City is currently preparing the grant application and identifying a project scope and is seeking input from Council and the public regarding project priorities. Applications for the RAISE Grant are due by February 28, 2024.
FISCAL IMPACT:
ATTACHMENTS:
None
14.B.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Approval of Supplemental Services Agreement No. 1 with Brandley Engineering for the preparation and completion of a detailed Pavement Maintenance Management Plan/Pavement Evaluation Study for the Hanford Municipal Airport for a contract amount Not to Exceed $170,000, to be funded 95% through Federal and State grants.
RECOMMENDATION:
Recommendation: That the City Council, by motion, approve Supplemental Services Agreement No. 1 with Brandley Engineering for the preparation and completion of a detailed Pavement Maintenance Management Plan/Pavement Evaluation Study for the Hanford Municipal Airport, for a contract amount Not to Exceed $170,000, to be funded 95% through Federal and State grants.
BACKGROUND:
Historically, airports have made decisions about pavement maintenance and rehabilitation (M&R) based on immediate need or experience rather than long-term planning or documented data on effective methods. This approach did not allow the airport sponsor to evaluate the cost effectiveness of alternative strategies, and it led to the inefficient use of available FAA funding.
A Pavement Management Program (PMP) provides a consistent, objective, and systematic procedure for establishing facility policies, setting priorities and schedules, allocating resources, and budgeting for pavement maintenance and rehabilitation. It can also quantify information and provide specific recommendations for actions required to maintain a pavement network at an acceptable level of service while minimizing the cost of maintenance and rehabilitation. A PMP not only evaluates the present condition of a pavement, but also predicts its future condition through the use of pavement condition indicators. By projecting the rate of deterioration, a life-cycle cost analysis can be made for various alternatives to determine the optimal time to apply the best M&R alternative and avoid higher M&R costs in the future.
The Five-Year Capital Improvement Plan calls for significant pavement improvements. However, the existing PMR is outdated and is not prioritized based on the actual condition of the existing pavement. The FAA requires that an airport have an updated PMR prior to funding any paving projects and, accordingly, they will pay for the majority of the cost to prepare the plan.
FISCAL IMPACT:
The total cost of this contract is not to exceed $170,000. The FAA will reimburse the City for $153,000. CalTrans Division of Aeornautics will reimburse the City for $8,500. The remaining
$8,500 will come from the Airport Enterprise Fund.
ATTACHMENTS:
1. Brandley Supplemental Services Agreement - PMMP
Supplemental Services Agreement No. 1
SUPPLEMENTAL SERVICES AGREEMENT NO. 1
Professional, Planning, Architectural and Design/Engineering Services associated with Airport Development Projects for the Hanford Municipal Airport This Agreement, entered into this day of , 2024, by and between the City of Hanford, hereinafter referred to as the “CITY”, and Brandley Engineering, Inc. as the “CONSULTANT”. hereinafter referred to as the “CONSULTANT.”
W I T N E S S E T H
WHEREAS, CITY entered into a Professional Services Agreement for Professional, Planning, Architectural and Design/Engineering Services associated with Airport Development Projects for the Hanford Municipal Airport with the CONSULTANT dated the 8th day of November 2023, and WHEREAS, the CITY has the desire to secure certain technical and professional services to assist in the preparation and completion of the Pavement Maintenance Management Plan (PMMP) as described as “Scope of Work” in Exhibit “A”, and hereinafter referred to as the “PROJECT”; and WHEREAS, the CONSULTANT represents it is licensed, qualified and willing to provide such services pursuant to terms and conditions of this Agreement.
NOW, THEREFORE, CITY and CONSULTANT agree as follows:
This agreement supplements said Professional Services Agreement, and the terms of said Agreement apply hereto.
I. SERVICES TO BE PERFORMED BY THE CONSULTANT
Authorized Scope of Work: The CONSULTANT agrees to perform all work necessary to complete in a manner satisfactory to the CITY those tasks described in Exhibit “A” - Scope of Work, for the cost identified in Exhibit “B” – Breakdown of Engineering Fees.
II. TIME OF PERFORMANCE
The CONSULTANT shall commence performance of this Agreement within five (5) days following receipt of fully executed Agreement and Notice to Proceed and shall complete the work within two (2) years unless otherwise extended in writing by CITY, in its sole discretion (to be altered if negotiated timeframes).
If the CONSULTANT fails to complete the PROJECT within the time specified, plus any extensions of time which may be granted, the CITY shall determine the percent of each work item completed and shall pay the CONSULTANT on that basis.
CONSULTANT shall not be responsible for delays which are due to causes beyond the CONSULTANT’s reasonable control. In the case of any such delay, the time of completion shall be extended accordingly in a writing signed by both parties.
Supplemental Services Agreement No. 1
III. COMPENSATION
A. Total Compensation: For services performed pursuant to this Agreement, the CITY agrees to pay and the CONSULTANT agrees to accept, as payment in full, a sum not to exceed One hundred seventy thousand dollars ($170,000).
This amount shall constitute complete compensation, including document production and out-of- pocket expenses for all services for the work and PROJECT identified in each Supplemental Services Agreement.
B. Payment of Compensation: The CONSULTANT shall be compensated according to Exhibit “B” upon completion of percentage of each noted phase. The CONSULTANT shall be paid no later than thirty (30) days following submission of a written, verified billing to the CITY. Said billing shall include the percentage of each task completed to date and since the date of the preceding billing, if any.
IV. AUTHORIZED REPRESENTATIVE
A. CITY: The City Manager shall represent the CITY in all matters pertaining to the services to be rendered under this Agreement, except where approval of the City Council of the City of Hanford is specifically required.
B. CONSULTANT: Melissa Brandley and R. Damon Brandley shall represent and act as principles for CONSULTANT in all matters pertaining to the services to be rendered by it under this Agreement.
Supplemental Services Agreement No. 1
IN WITNESS WHEREOF, this Agreement is executed on the day and year first above written.
CITY OF HANFORD CONSULTANT City Manager Melissa Brandley, Secretary, CFO
Attachments: Exhibit “A” – Scope of Work’
Exhibit “B” – Breakdown of Engineering Fees
Supplemental Services Agreement No. 1
Exhibit “A”: Scope of Work
A complete and detailed Pavement Maintenance Management Plan/Pavement Evaluation Study will be prepared that includes four major elements as listed below:
a. Pavement Structure Determination – In order to determine the existing strength of each pavement layer and the remaining life of each pavement section, detailed information about each pavement section on the airport must be determined prior to evaluating the non-destructive test data. A series of new geotechnical borings and cores will be taken throughout the airport to determine the thickness of each layer of every pavement section on the airfield. The results will be summarized for future design projects and utilized with the non-destructive testing (NDT) performed in this project to supplement the pavement condition index data as recommended in Advisory Circular 150/5380-7B Item 2.2.1.2 and Advisory Circular 150/5320-6G Appendix C.
b. Pavement Condition Index (PCI) Determination
Pavements show distress and/or failure due to weathering, other environmental effects, age, traffic, and lack of maintenance. These distresses generally show up in the form of cracking, shoving, spalling, rutting, or other surface defects. A detailed visual inspection will be made of all pavements. The scope of investigation will be performed as set forth in ASTM D5340, Airport Pavement Condition Index Surveys. Once these surveys are complete, Pavement Condition Index values will be assigned to each section of pavement.
c. Deep-Seated Distress
Deep-seated distress is a result of traffic passing over the pavement section and is a function of the type traffic (impact or static loads), the load on the tire, and the number of aircraft coverages. Deep- seated distress ultimately leads to total failure of the section including critical subgrades or subsoils.
These failures are generally exhibited as rutting and map cracking within the ruts for flexible pavements and slab shattering, cracking, or deflections in rigid pavements. The failure is generally a fatigue-type failure and is a function of the type of load and number of coverages. The Brandley Fatigue Analysis methodology and the FAA FAARFIELD methodology will be utilized to predict time of failure under fatigue loading. Non-destructive testing will be conducted to obtain the necessary basic data to evaluate these pavements. On areas where deep-seated distress analysis is required, all pavements are tested with the falling weight deflectometer with the spacing of the tests being 100 to 200 feet. d. Pavement Maintenance Management Program (PMMP) Report A PMMP report will be prepared that summarizes all data obtained in the geotechnical and pavement section determination, PCI determination, PCR, and deep-seated distress study derived from this data.
The report will include a detailed pavement rehabilitation plan and schedule including estimated budgets, plus the following:
Supplemental Services Agreement No. 1
1) Traffic Determination and Forecasts
When evaluating airfield pavements for deep-seated distress it is the number of coverages of each wheel on each aircraft over a given point of pavement that contributes to the deep-seated distress on or near that section of pavement. A determination of the current and forecast traffic at the airport will be made for traffic on each segment of airfield pavement based on the Airport’s traffic records and forecasts.
2) Analysis and Recommendations
Based on the surface distress surveys and the deep-seated distress analysis, forecast remaining pavement life is evaluated, time and type of strengthening or rehabilitation or reconstruction of each section is ascertained, different types of strengthening, overlaying, or reconstruction are analyzed, and cost benefit analyses are conducted. Recommended procedures for rehabilitation are then made for each section, including the time and type of repair and rehabilitation required. For rigid pavements it is important to determine the stress under load in the pavement section itself to determine the adequacy of the concrete section and estimated time of failure. It is also important to evaluate load-transfer of the joints and deep- seated distress using the Fatigue Analysis methodology. Once this is completed, analyses are conducted to determine the most cost-effective rehabilitation and the schedule that this rehabilitation work should be performed. The evaluations conducted will not only provide recommendations for strengthening and rehabilitating pavement sections but will also provide recommendations for maintenance work required to extend the life of the pavements and improve riding and operating conditions for the pavements. 3) Rehabilitation Costs
After the analysis and recommendations have been prepared for maintenance and rehabilitation, then preliminary cost analyses will be conducted to determine the estimated cost of the recommended maintenance and/or rehabilitation. These data can be used to establish maintenance and rehabilitation budgets for the airport.
Supplemental Services Agreement No. 1
Hours Rate Total
Pavement Structure Determination
Mobilization 3,000.00$
Truck Drill - 3 Man Crew 16.0 570.00$ 9,120.00
OT Truck Drill - 3 Man Crew 4.0 640.00 2,560.00
Per Diem - 3 Man Crew (Per Crew/Per Day) 3.5 700.00 2,450.00 Materials - Soil Tubes, concrete, dye 500.00
Senior Engineer (Field) 63.5 180.00$ 11,430.00
Senior Engineer - OT (Field) 12.0 270.00 3,240.00
Per Diem 6.0 195.00 1,170.00
Mileage 910.0 0.655 596.05
Geotechnical Engineer (Lab) 16.0 300.00 4,800.00
Senior Engineer (Lab) 73.0 180.00 13,140.00
Laboratory Technician (Lab) 12.0 90.00 1,080.00
Total Pavement Structure Determination 53,086.05$
Use 53,000.00$
Falling Weight Deflectometer Testing
Mobilization (From Ventura, CA) 14.0 337.00$ 4,718.00$
HWD Testing 1 Day 3,500.00 3,500.00
Equipment Set Up 1.5 110.00 165.00
Per Diem 2 Days 250.00 500.00
Photos - Lump Sum 500.00
Project Management 3.0 232.00 696.00
Principal Engineer 20.0 300.00 6,000.00
Mileage 500.0 0.655 327.50
Per Diem - Principal Engineer 2.0 195.00 390.00
Total Falling Weight Deflectometer Testing 16,796.50$
Use 17,000.00$
Pavement Condition Index (PCI)
Surface Condition Survey 8.0 300.00$ 2,400.00$
Evaluation of Data 12.0 300.00 3,600.00
Total PCI 6,000.00$
Engineering Analysis and Report
Principal Engineer 200.0 300.00$ 60,000$
Senior Engineer 50.0 180.00 9,000
Junior Engineer 180.0 120.00 21,600
Project Administrator 24.0 100.00 2,400
Clerical 10.0 85.00 850
Total Engineering & Report 93,850$
Use 94,000$
TOTAL 170,000$
EXHIBIT "B' - BREAKDOWN OF ENGINEERING FEES
Staff
Total
14.C.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Approval of a new 3-year Service Agreement with Main Street Hanford at an annual compensation amount of $81,090, which remains unchanged from the previous contract.
RECOMMENDATION:
Recommendation: That the City Council, by motion, approve a new 3-year Services Agreement with Main Street Hanford (MSH) with an annual compensation amount of $81,090.
BACKGROUND:
The current Services Agreement between the City of Hanford and Main Street Hanford expired on December 31, 2013. On January 16, 2024, Michelle Brown, the Director for Main Street Hanford, presented the Annual Report to Council. Their annual budget and profit and loss statement are attached to this staff report for MSH is willing to continue to provide the services as required under the terms of its most recent contract with the City. The annual compensation amount remains unchanged with this new Agreement. The only difference between this agreement and the expiring agreement is the inclusion of a 3- year term instead of the previous requirement to renew annually.
FISCAL IMPACT:
This Agreement will cost the City $81,090.00 annually for services provided under the agreement.
The funding for this agreement comes from the Business Improvement District and is already allocated in the City's adopted budget.
ATTACHMENTS:
1. 2024 Main Street Hanford Services Agreement - Final
2. 2024 Budget
3. ProfitandLoss
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SERVICES AGREEMENT
* * * * * * * * * * *
THIS AGREEMENT is effective the 1 st day of January, 2024, and is made by and between the CITY OF HANFORD, a municipal corporation (hereinafter “City”), and MAIN STREET HANFORD, a California non-profit public benefit corporation (hereinafter “MSH”).
City and MSH are hereinafter referred to collectively as the “Parties” and singularly as a “Party.”
W I T N E S S E T H
In consideration of the mutual covenants set forth herein and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:
1. RECITALS. This agreement is made and entered into with respect to the following facts:
a. The Hanford City Council has established the Central Parking and Business Improvement Area (hereinafter “District”), pursuant to Section 36000 et seq. of the Streets and Highways Code of the State of California, by the adoption of Ordinance No. 848 on April 22, 1975, as amended from time to time, and codified in Chapter 3.28 of the Hanford Municipal Code (hereinafter “ordinance”).
b. The City seeks services identified below that will benefit the District. c. MSH, is willing to provide such services.
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2. TERM.
a. The term of this AGREEMENT shall be for a period of three (3) years, effective from January 1, 2024, until December 31, 2026, except that this Agreement may be terminated by either Party as provided herein. b. Should MSH breach any term or condition of this Agreement or fail to perform any of the provisions of this Agreement that it is obligated to perform hereunder, the City shall have the right to immediately terminate this Agreement.
c. The City or MSH may terminate this Agreement for no cause at any time by giving sixty (60) calendar days prior written notice of termination. The termination shall be effective on the sixty-first (61 st) calendar day after the date of such written notice.
d. Effective the date of written notice of termination, MSH shall avoid incurring new expenses under this Agreement and City shall, except as otherwise provided herein, have no further obligation to render payment to MSH. Money previously paid to MSH and remaining unspent upon the date of termination shall be immediately returned to the City; MSH will, however, be entitled to compensation for authorized costs incurred and services provided to the City through the date of termination. Unspent monies and/or amounts owed to MSH, as applicable, will first be offset against any funds utilized by MSH for a purpose other than those authorized in Section 3 below.
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3. SERVICES. MSH shall provide the following services:
a. Engage in a program that cleans the District so that it is safe and appealing to consumers in a manner that promotes retail trade within the District. Such expenditures may include, without limitation: planting of annuals/color in the District’s flowerbeds; cleaning sidewalks and public spaces so that they are free of debris and animal waste; and hiring additional security during the Holiday shopping season.
b. Engage in activities that market the District so as to promote the District’s retail trade; such activities will include, without limitation, advertising and publicity efforts utilizing multiple forms of communication (e.g., radio ads for seasonal shopping and special events, television ads for seasonal shopping and special events, print media for seasonal shopping and special events, focusing on local and out-of-town shoppers and visitors, and social media campaigns designed to create interest in shopping and visiting the District area; and special events designed to bring visitors and shoppers to the District area) to attract consumers from communities throughout the San Joaquin Valley;
(i) One such special event that MSH intends to organize includes Thursday Night Market Place (hereinafter “TNMP”). MSH intends to hold TNMP in Civic Park on Thursdays from the first Thursday in May through the last Thursday in October (hereinafter “Rental Dates”). City hereby leases Civic Park rent-free to MSH on the Rental Dates during the term of this Agreement; provided however,
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City shall invoice MSH for City’s then-current costs to provide facility hosts and restroom supplies for each day that TNMP occurs, and MSH shall pay each invoice in full within thirty (30) calendar days of the date of an invoice. MSH will be solely responsible for arranging and paying for other services required for TNMP, including, without limitation, refuse collection services. The City’s waiver of rental charges is limited to TNMP and will not apply to any other event for which MSH may rent Civic Park or other City facility. The City’s obligations to MSH with respect to TNMP are limited to the terms contained in this paragraph.
c. Undertake activities that contribute toward the filling of building vacancies within the District in a manner that promotes the District’s retail trade activities, which may include, without limitation, real estate marketing campaigns designed to fill vacant storefronts and vacant lots, and window painting efforts to add interest to vacant buildings.
d. Prepare and provide to the City, for review by the City Council, an annual operations report for all matters covered under this Agreement on or prior to of each year of the Agreement. Such annual report shall account for: (i) all actual revenue, activities, and expenditures during the fiscal year of the District (January 1 through December 31) prior to the year of the report; (ii) all to-date and projected revenue, activities and expenditures during the then current fiscal year; and (iii) a specific management plan, including operating budget, for the fiscal year following the year of the report. The
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specific management plan and budget for the following fiscal year shall specify the actual activities and improvements proposed to be completed in that year pursuant to this Agreement and shall also include any information required under the enacting Ordinance. This report shall be presented to Council at an agendized study session and accepted by Council. This paragraph shall not be interpreted in a manner that requires MSH to provide information or material for its activities that occur outside of the scope of this Agreement.
The services listed above are consistent with the District’s purposes identified in the ordinance.
MSH shall select the service(s) that it will provide during the term of this Agreement, and the level of services provided shall be commensurate with the compensation that the City will pay to MSH in accordance with Section 4 below. For example (and for illustration purposes only), if MSH elects to limit its services to the marketing of the District in a manner that promotes the District’s retail trade, the level of marketing services provided shall be commensurate with the compensation amount identified in Section 4 below.
4. COMPENSATION.
a. MSH will receive a total of EIGHTY-ONE THOUSAND, NINETY AND NO/100 DOLLARS ($81,090.00) per year for the services to be provided hereunder. Pursuant to Hanford Municipal Code Chapter 3.28, businesses within the Central Parking and Business Improvement Area (“BIA”) pay an additional business license tax to the City. The amounts payable to MSH under this Agreement will be allocated by the City from BIA tax revenue.
The services for which MSH will be paid shall fall within the categories
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identified in Hanford Municipal Code Section 3.28.150. This amount will be paid in four (4) equal installments, which shall occur on July 1, October 1, January 1, and April 1.
b. Should MSH breach any term or condition of this Agreement or fail to perform any of the provisions of this Agreement that it is obligated to perform hereunder, the City shall have the right to withhold payment to MSH until any such breach is cured or performance made as determined by the City in its sole and absolute discretion.
5. FINANCIAL STATEMENTS.
a. Within sixty (60) calendar days of the end of each of MSH’s fiscal years (and portions thereof) that this Agreement remains in effect, MSH will provide to the City financial statements and written confirmation from an independent certified public accountant reasonably acceptable to the City that MSH is in full compliance with the terms of this Agreement. The financial statements shall, without limitation, reflect the manner in which funds received by MSH hereunder (“Agreement Funds”) have been utilized in furtherance of the activities identified in Section 3 above. Financial statements will include, without limitation, an itemized list of goods and services for which MSH expended Agreement Funds and detailed descriptions of such goods and services. Should this Agreement expire or terminate on a date other than the last day of MSH’s fiscal year, MSH will provide to the City, within sixty (60) calendar days of end of its then-current
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fiscal year, the financial statements for the portion of the fiscal year during which this Agreement remained in effect.
6. 6. INDEMNIFICATION. MSH agrees to indemnify, defend and hold harmless the City and its officials, officers, employees, agents and volunteers from and against all claims, demands, actions, injuries, liabilities, losses, costs or damages, direct or indirect, and any and all attorney’s fees and other expenses which the City or its officials, officers, employees, agents or volunteers may sustain or incur as a consequence of or anyway relate to MSH, or its employees’, agents’ and subcontractors’ performance of MSH’s responsibilities and obligations contained in this Agreement. This indemnification shall survive the termination of the Agreement.
7. INSURANCE REQUIREMENTS.
a. MSH will, during the term of this Agreement, maintain insurance coverage which shall be at least as broad as:
(1) Commercial General Liability (CGL): Insurance Services Office (ISO) Form CG 0001 1207 covering CGL on an “occurrence” basis, including products-completed operations, personal and advertising injury, with limits no less than TWO MILLION AND NO/100 DOLLARS ($2,000,000) per occurrence. Alternatively, MSH may maintain a CGL policy with limits of no less than ONE MILLION AND NO/100 DOLLARS ($1,000,000) per occurrence
and an umbrella coverage policy with coverage limits of no less than ONE MILLION AND NO/100 DOLLARS ($1,000,000) and
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which has a scope of coverage as broad as MSH’s CGL policy. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. (2) Automobile Liability: ISO Form Number CA 00 01 covering any auto (Code 1), or if MSH has no owned autos, hired (Code 8), and non-owned autos (Code 9), with a limit no less than ONE MILLION AND NO/100 DOLLARS ($1,000,000) per accident for bodily injury and property damage.
(3) Workers’ Compensation: as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with a limit of no less than ONE MILLION AND NO/100 DOLLARS
($1,000,000) per accident for bodily injury or disease.
If MSH maintains higher limits than the minimums shown above, the City requires and shall be entitled to coverage for the higher limits maintained by MSH.
b. Any deductibles or self-insured retentions must be declared to and approved by the City.
c. The policies are to contain, or be endorsed to contain, the following provisions:
(1) The City and its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by
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or on behalf of MSH including materials, parts, or equipment furnished in connection with such work or operations; products used by MSH; or automobiles owned, leased, hired or borrowed by MSH. General liability coverage can be provided in the form of an endorsement to MSH’s insurance at least as broad as ISO Form CG 20 10 11 85 or if not available, through the addition of both CG 20 10 and CG 20 37 if a later edition is used. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees or volunteers.
(2) For any claims related to this contract, MSH’s insurance coverage shall be primary insurance as to the City and its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the City and/or its officers, officials, employees, or volunteers shall be in excess of MSH’s insurance and shall be non- contributory.
(3) Each insurance policy required above shall provide that coverage shall not be canceled, except with notice to the City.
d. Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VII.
e. MSH shall furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause. All certificates and endorsements are to be received and
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approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the MSH’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.
f. MSH hereby grants to City and its officers, officials, employees, and volunteers a waiver of any right to subrogation which any insurer of MSH may acquire against the City and/or its officers, officials, employees, and volunteers by virtue of the payment of any loss under such insurance. MSH agrees to obtain endorsements necessary to effect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.
g. The City reserves the right to modify the insurance requirements contained in this contract, including, without limitation, coverage limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances. h. MSH shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein. i. MSH will maintain special event or other similar coverage with respect to any and all events operated or sponsored by MSH pursuant to Section 3 above. MSH will notify the City at least forty-five (45) calendar days before any such event, and the City will identify the coverage limits that MSH will be required to maintain for such an event.
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8. INDEPENDENT CONTRACTOR STATUS. It is understood and agreed that MSH, in the performance of this Agreement, shall act as and be an independent contractor and shall not act as an agent or employee of the City. MSH and its employees shall obtain no retirement benefits or other benefits that accrue to the City’s employees and MSH hereby expressly waives any claim it may have to any such rights. Nothing in this Agreement shall create or be construed as creating a partnership, joint venture or any other relationship between the City and MSH.
9. NOTICES. All notices herein required shall be in writing and shall be sent by certified mail, postage prepaid, addressed as follows:
Main Street Hanford City of Hanford
P.O. Box 690 319 N. Douty Street
Hanford, CA 93232 Hanford, CA 93230
Attn: Executive Director Attn: City Manager
10. COMFORMANCE TO APPLICABLE LAWS. MSH shall comply with all applicable federal, state, and city laws, rules and ordinances. No discrimination shall be made by MSH in the employment of persons to work under this Agreement because of race, color, national origin ancestry, sex or religion of such person.
11. ATTORNEYS’ FEES. If an action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorney’s fees, costs and necessary disbursements in addition to any other reasonable relief to which he may be entitled. With respect to any suit, action or proceeding arising out of or related to this Agreement, or the documentation related hereto, the parties hereby submit to the jurisdiction and venue of the Superior Court, for the County of Kings, State of California for any proceeding arising hereunder.
12. SOLE AND ONLY AGREEMENT. This Agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto with respect to the matters set forth
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herein and contains all of the covenants and agreements between the parties regarding said matters.
Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or in writing, have been made by any party or anyone acting on behalf of any party which is not embodied in the Agreement and no other agreement, statement or promise shall be valid or binding.
13. INVALIDITY. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force and effect without being impaired or invalidated in anyway.
14. AMENDMENT. No change, amendment or modification of the Agreement shall be valid unless the same be in writing and signed by the parties hereto. ///
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the day and year first above written.
CITY OF HANFORD, a Municipal
Corporation,
By ________________________________
TRAVIS PADEN
Mayor
ATTEST:
_______________________________
NATALIE CORRAL, City Clerk
APPROVED AS TO FORM:
GRISWOLD, LaSALLE, COBB
DOWD & GIN, L.L.P., City Attorney
By: ____________________________
TY N. MIZOTE
MAIN STREET HANFORD
By: _________________________________
MICHELLE BROWN
Executive Director
Accrual Tuesday, January 16, 2024 09:35 AM America/Los_Angeles 1/4 HANFORD MAIN STREET PROGRAM, INC.
Budget Overview_Budget_FY24_P&L_Report
Jan 1 - Dec 31 2024
ACCOUNT TOTAL
Income
Associate Memberships $300.00
Blues Festival
Beer & Wine $10,150.00
Sponsorships $12,000.00
T-Shirts $500.00
Vendors $400.00
Total for Blues Festival $23,050.00
Christmas Tree Walk Income $4,000.00
City of Hanford-BID Assessment
BID Assessment $81,545.00
Total for City of Hanford-BID Assessment $81,545.00
Everybody's Irish
Participation Fees $1,875.00
Sponsorships $2,252.00
Tickets $28,275.00
Total for Everybody's Irish $32,402.00
Promotions
Coop Advertising $3,000.00
Total for Promotions $3,000.00
TNMP
Beer & Wine $162,480.00
Growers & Vendors $80,064.00
Sponsorships $75,000.00
Total for TNMP $317,544.00
Unapplied Cash Payment Income $0.00
Wine and Chocolate Event
Wine & Chocolate
Participation Fees $4,575.00
Sponsorships $5,250.00
Tickets $47,000.00
Total for Wine & Chocolate $56,825.00
Total for Wine and Chocolate Event $56,825.00
Witches Night Out
Beer Sales $5,565.00
Cover Charge $1,275.00
Tickets $56,960.00
Total for Witches Night Out $63,800.00
Accrual Tuesday, January 16, 2024 09:35 AM America/Los_Angeles 2/4
ACCOUNT TOTAL
Total for Income $582,466.00
Cost of Goods Sold $0.00
Gross Profit $582,466.00
Expenses
Advertising/Promotional $2,000.00
Annual Dinner Meeting $2,000.00
Bank Charges
Credit Card Fees $6,800.00
Total for Bank Charges $7,000.00
Blues Festival Costs
Advertising $1,560.00
Beer Garden $2,900.00
Entertainment $13,000.00
Permits $1,500.00
Restrooms $300.00
Security $2,000.00
Supplies $1,000.00
T-Shirts $2,500.00
Total for Blues Festival Costs $24,760.00
Christmas Tree Walk
Christmas Trees $3,050.00
Printing/Advertising $800.00
Supplies $675.00
Total for Christmas Tree Walk $4,525.00
Copy Costs $2,600.00
Design Committee Expense
DT Improvement Project $8,500.00
Facade Grant $15,000.00
Power Washing $12,000.00
Twinkle Lights $2,000.00
Total for Design Committee Expense $37,500.00
Econ Restruct Committee
Contributions/Sponsorships $500.00
Total for Econ Restruct Committee $500.00
Everybody's Irish Costs
Beer $5,000.00
Entertainment $500.00
Permits $860.00
Printing/advertising $1,770.00
Security $1,112.00
Supplies $5,000.00
Total for Everybody's Irish Costs $14,242.00
Insurance
Accrual Tuesday, January 16, 2024 09:35 AM America/Los_Angeles 3/4
ACCOUNT TOTAL
Directors & Officers $2,500.00
General Liablity $8,000.00
Health Insurance $9,000.00
Workers' Comp. Ins. $2,000.00
Total for Insurance $21,500.00
Maintenance & Repairs $2,600.00
Membership Dues & Fees $3,367.00
Office Supplies/Equipment $11,000.00
Oktoberfest Expense
Credit Card Fees $0.00
Total for Oktoberfest Expense $0.00
Organization Committee
Mileage Reimbursement $400.00
Volunteer Appreciation Dinner $5,000.00
Website $1,400.00
Total for Organization Committee $6,800.00
Other Expenses
Education/Networking $250.00
Total for Other Expenses $250.00
Payroll Expenses
Taxes $13,015.00
Wages $135,000.00
Total for Payroll Expenses $148,015.00
Postage $1,700.00
Professional Services
Accounting $3,500.00
Total for Professional Services $3,500.00
Promotions Committee
Events $900.00
Image Building $7,500.00
Total for Promotions Committee $8,400.00
Rent $13,000.00
Salaries & Wages
Director
Commissions - Director $7,860.00
Total for Director $7,860.00
Total for Salaries & Wages $7,860.00
Small Business Saturday $6,000.00
Subscriptions $360.00
Taxes & Licenses $3,500.00
Telephone $4,000.00
TNMP Costs
Beer & Wine $55,272.00
Accrual Tuesday, January 16, 2024 09:35 AM America/Los_Angeles 4/4
ACCOUNT TOTAL
Employees $0.00
Entertainment $17,460.00
Kids Activities $7,000.00
Licenses & Permits $1,500.00
Posters/Advertising/Tab $15,000.00
Refuse $8,196.00
Rentals $13,764.00
Restrooms $4,791.00
Security $22,224.00
TNMP Supplies $6,200.00
Truck $1,300.00
T-Shirts & Merchandise $2,400.00
Total for TNMP Costs $155,107.00
Training/Travel/Mtgs. $555.00
Travel/Lodging/Meals $4,050.00
Utilities $2,650.00
Wine & Chocolate Costs
Advertising $625.00
Chocolate $3,375.00
Glasses $5,200.00
Permit $2,200.00
Printing-Maps $1,650.00
Purchases $3,600.00
Security $1,260.00
W&C Entertainment $2,425.00
Wine $13,000.00
Total for Wine & Chocolate Costs $33,335.00
Witches Night Out Expense
Beer $1,765.00
Entertainment $5,168.00
Permits $4,520.00
Printing/Advertising $3,580.00
Security $3,692.00
Supplies $30,000.00
Total for Witches Night Out Expense $48,725.00
Total for Expenses $581,401.00
Net Operating Income $1,065.00
Other Income $0.00
Other Expenses $0.00
Net Other Income $0.00
Net Income $1,065.00
HANFORD MAIN STREET PROGRAM, INC.
Profit and Loss
January - December 2023
Accrual Basis Tuesday, January 16, 2024 09:29 AM GMT-08:00 1/5 TOTAL
Income
Associate Memberships 300.00
Blues Festival
Beer & Wine 10,157.00
Sponsorships 12,350.00
T-Shirts 560.00
Vendors 420.00
Total Blues Festival 23,487.00
Christmas Tree Walk Income 3,901.00
City of Hanford-BID Assessment
BID Assessment 81,090.00
Total City of Hanford-BID Assessment 81,090.00
Discounts/Refunds Given 122.07
Everybody's Irish
Participation Fees 1,875.00
Sponsorships 2,250.00
Tickets 28,275.00
Total Everybody's Irish 32,400.00
Food Truck Takeover
FTT - Beer & Wine Sales 2,860.00
Total Food Truck Takeover 2,860.00
Misc. Income 205.25
Sales 3,000.00
TNMP
Beer & Wine 162,482.57
Growers & Vendors 80,067.95
Sponsorships 76,400.00
Total TNMP 318,950.52
Wine and Chocolate Event
Wine & Chocolate
Participation Fees 4,575.00
Sponsorships 5,250.00
Tickets 47,510.00
Total Wine & Chocolate 57,335.00
Total Wine and Chocolate Event 57,335.00
Winter Wonderland
Beer and Wine Sales 10.00
Total Winter Wonderland 10.00
HANFORD MAIN STREET PROGRAM, INC.
Profit and Loss
January - December 2023
Accrual Basis Tuesday, January 16, 2024 09:29 AM GMT-08:00 2/5 TOTAL
Witches Night Out
Beer Sales 5,565.00
Cover Charge 1,275.00
Tickets 56,960.00
Total Witches Night Out 63,800.00
Total Income $587,460.84
GROSS PROFIT $587,460.84
Expenses
Advertising/Promotional 1,937.89
Annual Dinner Meeting 1,915.32
Bad Debts 1,700.00
Bank Charges 175.24
Credit Card Fees 6,673.22
Total Bank Charges 6,848.46
Blues Festival Costs
Advertising 1,561.71
Beer Garden 2,894.88
Entertainment 12,940.44
Permits 1,533.00
Restrooms 284.63
Security 1,995.00
Supplies 1,096.16
T-Shirts 3,116.25
Total Blues Festival Costs 25,422.07
Board Activities/Meetings 1,384.29
Christmas Tree Walk
Christmas Trees 3,052.52
Printing/Advertising 791.98
Supplies 674.02
Total Christmas Tree Walk 4,518.52
Copy Costs 2,591.23
Design Committee Expense
Facade Grant 1,605.00
Power Washing 12,000.00
Twinkle Lights 2,134.28
Total Design Committee Expense 15,739.28
Econ Restruct Committee
Contributions/Sponsorships 557.89
Total Econ Restruct Committee 557.89
HANFORD MAIN STREET PROGRAM, INC.
Profit and Loss
January - December 2023
Accrual Basis Tuesday, January 16, 2024 09:29 AM GMT-08:00 3/5 TOTAL
Everybody's Irish Costs
Beer 3,527.29
Entertainment 500.00
Permits 860.00
Printing/advertising 1,769.89
Security 1,112.00
Supplies 1,295.93
Total Everybody's Irish Costs 9,065.11
Food Truck Takeover Expense
FTT - Beer & Wine 2,578.85
FTT - Permits & Fees 160.00
FTT - Security 560.00
FTT - Supplies 43.02
Total Food Truck Takeover Expense 3,341.87
Insurance
Directors & Officers 2,120.00
General Liablity 7,545.62
Health Insurance 8,903.35
Workers' Comp. Ins. 1,736.00
Total Insurance 20,304.97
Maintenance & Repairs 2,542.89
Masquerade Ball Expense
Entertainment 2,000.00
Permits -1,250.00
Total Masquerade Ball Expense 750.00
Membership Dues & Fees 3,167.73
Misc. Expense 188.00
Office Supplies/Equipment 10,966.64
Organization Committee
Mileage Reimbursement 397.34
Volunteer Appreciation Dinner 5,165.19
Website 1,365.14
Total Organization Committee 6,927.67
Other Expenses
Education/Networking 210.00
Total Other Expenses 210.00
Payroll Expenses
Taxes 13,370.67
Wages 137,458.12
Total Payroll Expenses 150,828.79
Postage 1,709.52
HANFORD MAIN STREET PROGRAM, INC.
Profit and Loss
January - December 2023
Accrual Basis Tuesday, January 16, 2024 09:29 AM GMT-08:00 4/5 TOTAL
Professional Services
Accounting 3,192.59
Total Professional Services 3,192.59
Promotions Committee
Co-op Advertising 116.00
Events 872.28
Image Building 6,736.39
Total Promotions Committee 7,724.67
Rent 13,000.00
Salaries & Wages
Director
Commissions - Director 7,860.00
Total Director 7,860.00
Total Salaries & Wages 7,860.00
Small Business Saturday 6,900.00
Subscriptions 360.00
Taxes & Licenses 3,123.00
Telephone 3,739.09
TNMP Costs
Beer & Wine 55,275.61
Entertainment 17,460.00
Kids Activities 7,137.14
Licenses & Permits 1,370.00
Posters/Advertising/Tab 37,365.34
Refuse 8,116.72
Rentals 13,760.00
Restrooms 4,791.00
Security 22,222.20
T-Shirts & Merchandise 2,421.60
TNMP Supplies 6,167.78
Truck 1,204.06
Total TNMP Costs 177,291.45
Training/Travel/Mtgs. 555.00
Travel/Lodging/Meals 4,050.24
Utilities 2,648.47
Wine & Chocolate Costs -1,872.05
Advertising 625.00
Chocolate 3,376.39
Glasses 5,169.45
Permit 2,115.28
Printing-Maps 1,614.92
Purchases 3,643.11
HANFORD MAIN STREET PROGRAM, INC.
Profit and Loss
January - December 2023
Accrual Basis Tuesday, January 16, 2024 09:29 AM GMT-08:00 5/5 TOTAL
Security 1,260.00
W&C Entertainment 2,425.00
Wine 13,001.17
Total Wine & Chocolate Costs 31,358.27
Winter Wonderland Costs -70.74
Permits 85.00
Security 272.00
Supplies -199.01
WW Marketing Expense -1,875.00
Total Winter Wonderland Costs -1,787.75
Witches Night Out Expense
Beer 1,766.53
Entertainment 5,168.00
Permits 4,520.00
Printing/Advertising 3,583.93
Security 3,692.50
Supplies 30,188.65
Total Witches Night Out Expense 48,919.61
Total Expenses $581,552.78
NET OPERATING INCOME $5,908.06
Other Income
Interest 25.29
Total Other Income $25.29
NET OTHER INCOME $25.29
NET INCOME $5,933.35
14.D.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Adoption of Resolution No. 24-04-R Approving an Amendment to the Standard Agreement issued under the 2020 Community Development Block Grant Program Coronavirus Response (CDBG-CV)
RECOMMENDATION:
Recommendation: That the City Council, by motion, Adopt Resolution No. 24-04-R.
BACKGROUND:
In June 2022, the Council adopted Resolution 22-25-R, allowing the City to accept $1,150,000 in State funding from the 2020 Community Development Block Grant Program - Coronavirus Response (CDBG-CV2) for the rehabilitation of the Sunrise Apartments (formerly Stardust Motel) on Lacey Boulevard. The project aimed to convert temporary housing into permanent housing for homeless individuals. The rehabilitation process involved fully converting the 22 apartments into permanent housing.
In July 2023, the Council adopted Resolution 23-21 R, authorizing an additional $287,500 in unclaimed CDBG-CV funding for construction project grantees.
On January 29, 2024, the California Department of Housing and Community Development (HCD) requested that the City submit an updated resolution with the following language:
The City of Hanford previously approved the use of $1,150,000 for this CDBG-CV activity, which was included in the 21-CDBG-HK-00014, and by this resolution, will use an additional amount not to exceed $287,500 for a total commitment of $1,437,500.
Tonight's action simply lists both funding amounts in a single resolution to comply with the request from the State.
List of Activity Funding:
Current Authorized amount(s) under Standard Agreement # 21-CDBG-HK-00014:
• CDBG-CV: $1,150,000
Amount of new CDBG-CV funds to be added to Standard Agreement # 21-CDBG-HK-00014
• CDBG not to exceed $287,500.
The total amount of amended Standard Agreement # 21-CDBG-HK-00014 • CDBG Grant Not to exceed $1,437,500.
The approved 22-25 and 23–21 Resolutions and Staff Reports are attached for reference.
FISCAL IMPACT:
ATTACHMENTS:
1. NO. 24-04-R-(CDBG-CV)- Attachment 1
2. NO. 22-25 R-Attachment 2
3. NO. 23-21 R-Attachment 3
CDBG-CV Allocation of
Remaining Funding –
Jurisdiction Resolution 1
Department of Housing and Community Development
Version 11/15/2023
CDBG-CV
Resolution of the Hanford City Council
RESOLUTION NO. 02-24
A RESOLUTION APPROVING AN AMENDMENT TO THE STANDARD
AGREEMENT ISSUED UNDER THE 2020 COMMUNITY
DEVELOPMENT BLOCK GRANT PROGRAM CORONAVIRUS
RESPONSE (CDBG-CV)
BE IT RESOLVED by the City Council of Hanford of the City of Hanford as follows:
SECTION 1:
The City has reviewed and hereby approves the submission to the State of California (“State”) of a Request for Additional Funds to fill gaps created by documented unanticipated cost increases. The funds would be added to its existing CDBG-CV Standard Agreement(s) with the State numbered
# 21-CDBG-HK-00014 (the “Standard
Agreement(s)”) pursuant to the State’s June 2020 CDBG-CV1 Notice of Funding Availability; December 2020 CDBG-CV2 and CV3 Notice of Funding Availability (NOFA); and/or the CDBG Method of Distribution as described in the State of California 2019-2020 Annual Action Plan August 2020 Second Substantial Amendment and the CDBG-CV Method of Distribution as described in the State of California 2019-2020 Annual Action Plan August 2020 Fifth Substantial Amendment.
The City previously approved the use of $1,150,000 for this CDBG-CV activity which was included in the 21-CDBG-HK-00014 and by this resolution will use an additional amount not-to-exceed $287,500 for a total commitment of $1,437,500.
List of Activity Funding:
Current Authorized amount(s) under Standard Agreement
# 21-CDBG-HK-00014:
CDBG-CV: $1,150,000
Amount of new CDBG-CV funds to be added to Standard Agreement # 21-CDBG-HK- 00014
CDBG Not to exceed $287,500.
Total amount of amended Standard Agreement # 21-CDBG-HK-00014 CDBG Grant Not to exceed $1,437,500.
Attachment 1
CDBG-CV Allocation of
Remaining Funding –
Jurisdiction Resolution 2
Department of Housing and Community Development
Version 11/15/2023
CDBG-CV
SECTION 2:
The City acknowledges compliance with all state and federal public participation requirements with respect to the proposed amendments to the Standard Agreement described in Sections 1 above.
SECTION 3:
The City hereby authorizes and directs the City Manager, or designee*, to execute and deliver all application(s), “Request(s) for Additional Funds,” and/or amendments to the Standard Agreement and act on the City’s behalf in all matters pertaining to all such application(s), “Request(s) for Additional Funds,” and/or amendments.
SECTION 4:
If an amendment to the Standard Agreement is approved as contemplated above, the City Manager or designee*, is authorized to enter into, execute, and deliver an amendment to the Standard Agreement and any and all other documentation which may be required by the State from time to time for the purposes of this grant.
CDBG-CV Allocation of
Remaining Funding –
Jurisdiction Resolution 3
Department of Housing and Community Development
Version 11/15/2023
CDBG-CV
SECTION 5:
If an amendment to the Standard Agreement is approved, the City Manager, or designee*, is authorized to sign and submit Funds Requests and all required reporting forms and other documentation as may be required by the State of California from time to time in connection with this grant.
* Important Note: If the designee is signing any application, agreement, amendment, or any other document on behalf of the designated official of the City/County, written proof of designee authority to sign on behalf of such designated official must be included with the Resolution, otherwise the Resolution will be deemed deficient and rejected.
Additionally, do not add limitations or conditions on the ability of the signatory or signatories to sign documents, or the Resolution may not be accepted. If more than one party’s approval is required, list them as a signatory. The only exception is for county counsel or city attorney to approve as to form or legality or both, IF such approval is already part of the standard city/county signature block as evidenced by the signed Resolution itself. Inclusions of additional limitations or conditions on the authority of the signer will result in the Resolution being rejected and will require your entity to issue a corrected Resolution prior to the Department issuing a Standard Agreement or any subsequent amendments thereto.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Hanford held on February 6, 2023 by the following vote:
AYES: _______________________________________________________ NOES:________________________________________________________ ABSTAIN: _____________________________________________________ ABSENT: _____________________________________________________
_______________ _____________________
Mayor Paden
City of Hanford Mayor
CDBG-CV Allocation of
Remaining Funding –
Jurisdiction Resolution 4
Department of Housing and Community Development
Version 11/15/2023
CDBG-CV
STATE OF CALIFORNIA
[City or County] of _____________________
“I, ___________, [City or County] Clerk of the [City or County] of _________, State of California, hereby certify that (i) the above and foregoing is a full, true, and correct copy of a resolution duly adopted by said [City Council or Board of Supervisors, as applicable] on this _____ day of ________, 20___; (ii) such resolution has not been amended, modified, repealed or rescinded since the date of its adoption; and (iii) such resolution remains in full force and effect.”
_______________ ____________________________
Natalie Corral, City Clerk of the City of Hanford, State of California
By: _____________________________
Name and Title
(Note: The attesting officer cannot be the person identified in the Resolution as the authorized signer.)
Attachment 2
Attachement 3
14.E.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Approval of an increase to the Purchase Order for the purchase of fuel for City-owned equipment and vehicles, from Van Der Pol Enterprises up to $80,000 annually
RECOMMENDATION:
Recommendation: Staff recommends that City Council Authorize the purchase of fuel for City-owned equipment and vehicles from Van Der Pol Enterprises up to $80,000 annually.
Recommended Motion: I move to Authorize the purchase of fuel for City-owned equipment and vehicles from Van Der Pol Enterprises up to $80,000 annually.
BACKGROUND:
The City of Hanford municipal code requires that all purchases above $50,000 be approved by the City Council.
BPO 22400427 was originally issued to Van De Pol Enterprises for the amount of $40,000; BPO 22400281 (Buford Oil) was originally approved by the City Council for the amount of $150,000.
This request is for an increase of BPO 22400427 in the amount of $80,000 and the reduction of BPO 22400281 in the amount of $80,000. Both Van Der Pol Enterprises and Buford Oil provide fuel for all city-owned vehicles and equipment. Buford Oil has not been able to compete with the pricing offered by Van De Pol Enterprises to date.
FISCAL IMPACT:
No fiscal impact as this purchase would draw from existing budget appropriation.
ATTACHMENTS:
None
14.F.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Appropriate $193,902 from the Refuse Fund (0307) and approve sole source awards for the purchase of various sized front load refuse plastic commercial bins from Toter LLC in the amount of $74,074.26 and various metal commercial bins from Wastquip in the amount of $119,827.15 due to the familarity of both vendors and the City of Hanford's refuse bin specifications.
RECOMMENDATION:
Recommendation:
Staff recommends that City Council Appropriate $193,902 from the Refuse Fund (0307) and approve sole source awards for the purchase of various sized front load refuse plastic commercial bins from Toter LLC in the amount of $74,074.26 and various metal commercial bins from Wastquip in the amount of $119,827.15 due to the familarity of both vendors and the City of Hanford's refuse bin specifications.
Recommended Motion:
1. I move to approve the appropriation of $193,902 from Refuse Reserves (0307) to fund the purchase of various commercial refuse bins.
AND
2. Approve the sole source purchase of various commercial refuse bins from Toter LLC for $74,074.26 and Wastquip for $199,827.15.
BACKGROUND:
Currently, the Refuse Division operates 3 total front load routes and has had plans to implement several additional front load commercial routes over a span of several years. The unplanned, mandated purchase of three new front load refuse trucks has expedited the need to convert an additional three rear load routes to front load routes, ahead of scheduled plans.
A sole source purchase authorization is recommended due to the timeliness of this order to be in place and due to the familiarity that both vendors have with the City of Hanford's refuse needs and specifications of commercial bins used for City service.
FISCAL IMPACT:
The Refuse Fund (0307) currently has an approximate fund balance of $704,000 and can fully support the purchase.
ATTACHMENTS:
1. Toter Quote
2. Wastequip Quote
14.G.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Approval of the Hanford Police Department's Canine Conditions of Acceptance contract between the City of Hanford and the Department's Canine Handlers, and Authorization for the Police Chief to execute the Agreements.
RECOMMENDATION:
Recommendation: That the City Council, by motion, approve the Hanford Police Department's Canine Conditions of Acceptance contract between the City of Hanford and the Department's Canine Handlers, and Authorize the Police Chief to execute the Agreements.
BACKGROUND:
The Hanford Police Department acknowledges and values the invaluable service provided by its Police Canine units and is committed to ensuring a seamless transition for retired canines. The primary goal of this transfer is to ensure the continuous care and well-being of the retired Police Canine, while fostering a positive relationship between the City and the Canine Handler.
As part of this transfer, the Canine Handler will assume liability for the well-being and actions of the retired Police Canine. This means that the Canine Handler will be fully responsible for any potential incidents or expenses related to the retired canine's health and behavior. This arrangement emphasizes the Canine Handler's commitment to the ongoing care and responsible management of the retired Police Canine.
This approach not only secures the retired canine's welfare but also aligns with the Hanford Police Department's dedication to responsible canine care and the well-established bond between law enforcement and the communities they serve.
The recommendation to transfer the retired Police Canine to the Canine Handler is grounded in the following considerations:
Proven Track Record: The Canine Handler has demonstrated a consistent and proven track record of responsible and compassionate canine care.
Continuity of Care: The transfer ensures continuity of care, leveraging the Canine Handler's familiarity with the retired Police Canine's specific needs.
Seamless Transition: The recommended transfer promises a seamless transition for the retired canine, providing ongoing support and maintaining the positive rapport established during years of dedicated service.
This agreement between the City and the Canine Handler allows for the handler to continue caring for the retired canine, emphasizing a dedication to its ongoing well-being.
FISCAL IMPACT:
The city will receive $1.00 of revenue from the Canine Handler upon completion of the transfer.
ATTACHMENTS:
1. Final Draft HPD K9 Contract 1 24 24
STEPHANIE HUDDLESTON, CHIEF OF POLICE
Date:
To: Attention: Officer XXXX, ID XXXXX
From:
File No.:
Subject: CONDITIONS OF CANINE ACCEPTANCE
Based on information provided by the Hanford Police Department regarding canine CANINE NAME’s performance, it has been determined canine CANINE NAME has little or no value to the Department as a working canine or as city equipment. Therefore, your request to keep canine CANINE NAME has been approved upon acceptance/completion of the conditions stated below.
The City of Hanford / Hanford Police Department makes no warranty, expressed or implied, as to the physical or psychological condition of canine CANINE NAME. This canine has been trained and utilized in a law enforcement capacity, which may have included handler protection or bite training. Certain drives and temperaments have been altered or enhanced, which may increase the risk of accidental dog bites and / or other atypical canine behavior. The Hanford Police Department now considers this animal unsuitable for law enforcement deployment.
Upon remittance of payment in the amount of $1.00 to the Hanford Police Department, along with a signed copy of this agreement, you officially and formally accept the ownership, interest, and responsibilities for canine CANINE NAME. In doing so, you hereby waive all present and future rights to initiate any claim or action against the Hanford Police Department and the City of Hanford and its officials, officers, employees, agents, and assigns, current and former, for any damages or injury that may be caused at any time by canine CANINE NAME with no representation from the Hanford Police Department or the City of Hanford as to canine CANINE NAME’s fitness, qualifications, abilities, or other characteristics other than that which is represented in this agreement.
Furthermore, in accepting canine CANINE NAME, you hereby agree to the following conditions:
City of H A N F O R D
HANFORD POLICE DEPARTMENT
425 N Irwin Street
Hanford, CA 93230
(559)585-2540
•At all times the K9 policy provisions of the Hanford Police Department regarding canine control existing at the time that this agreement is signed shall be adhered to with respect to Canine CANINE NAME.
•Canine CANINE NAME shall not be utilized at any time in any law enforcement capacity. This includes any previous duties undertaken for or on behalf of the Department, as well as for or with any other law enforcement agency.
•Canine CANINE NAME shall be your sole responsibility and obligation. At all times the K9 is unattended it shall be kept in the kennel previously provided by the City or in a different kennel of adequate design and construction to contain Canine CANINE NAME. When the K9 is in public it shall be leashed. Should you become unable or unwilling to comply with this agreement or provide basic care and upkeep for canine CANINE NAME, you shall be responsible, at your expense, for the destruction of canine CANINE NAME. Under no circumstances shall the canine be given to any other person, organization, department, or agency. •Consistent with the agreement that canine CANINE NAME shall be your sole responsibility and obligation, you agree to indemnify, defend, and hold harmless the City, its officials, officers, employees, agents, and assigns, current and former, from any litigation, claim, damages, or liability in any forum that is initiated or might be brought against the City or its officials, officers, employees, agents, or assigns, current and former, by any individual that in any manner arose or resulted from the actions of canine CANINE NAME following its retirement.
The provisions of this agreement constitute the complete document for purposes of this transaction and there are no implied or separate understandings apart from this document with respect to this transaction.
None of the above requirements may be modified subsequent to this agreement without the written consent of both parties. If the Department learns that any of the requirements agreed to are violated, it has the right to, and will, seize canine CANINE NAME from your possession and undertake to have the canine destroyed, the expense for the seizure and destruction to be billed to you.
The above terms and conditions have been discussed and are fully understood.
Chief of Police
Accepted by: ____________________________________ Date: ________________ Officer XXXX XXXX, ID XXXXX
14.H.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Authorization for the City Manager to execute an agreement with Wells Fargo Bank for banking and Lockbox services at an annual cost of approximately $135,000 for a term of three years, with an option to extend by two years.
RECOMMENDATION:
Recommendation: That the City Council, by motion, Authorize the City Manager to execute an agreement with Wells Fargo Bank for banking and Lockbox services at an annual cost of approximately $135,000 for a term of three years, with an option to extend by two years.
Recommended Motion: I move to authorize the City Manager to execute an agreement with Wells Fargo Bank for banking and Lockbox services at an annual cost of approximately $135,000 for a term of three years, with an option to extend by two years.
BACKGROUND:
The City of Hanford has been in a business relationship with Wells Fargo Bank for many years. Wells Fargo has provided banking services for the City during this time in which fees are paid for services provided in handling cash for the City. On average over the last several years the City has paid approximately $71,000 annually.
In the past few months, City staff has begun discussion with Well Fargo Bank, for Wells Fargo to provide Lockbox services for the City. This service would provide that Utility mail-in payments would be mailed to and handled directly by Wells Fargo at a "Lockbox Box" location in California. Funds would be deposited quicker, and payments would be posted faster, which would provide an enhancement for customer service. In addition, this service would provide staff with more effective use of their time in order to focus on customer service such as quicker response times and ability to focus on customer accounts for accuracy. The service is estimated to cost approximately $64,000 annually. This could lead to cost savings for the City in mitigating the need for additional staff well into the future.
Due to the long term relationship that the City has had with Wells Fargo Bank (since 1993), an updated agreement is recommended to include adding the Lockbox services as an addendum to the master agreement currently in place. The City has had no issues with Wells Fargo Bank's services that would prohibit recommendation of continuation of the current working relationship. This authorization would help protect the City from banking service fee increases over the term of the agreement.
FISCAL IMPACT:
This authorization would help protect the City from banking service fee increases over the term of the agreement.
The City averages approximately $71,000 in banking service fees annually and, if authorized will pay approximately $64,000 annually for Lockbox services, for a total of $135,000 annual. Many bank fees are based on transactions, which depending on activity may be more or less than these approximate annual amounts. Staff anticipates no more than a 10% variance. Costs of banking fees are not entirely paid by the General Fund, they are allocated to many funds based on activity.
Budget adjustments are not needed for general banking service fees as they are already included in the approved budget. A budget adjustment for Lockbox service fees will be presented to City Council in future budget adjustment actions, most likely during the mid-cycle budget review in May/June 2024.
ATTACHMENTS:
1. Wholesale Lockbox Insight Sheet
Wholesale
lockbox
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Greater visibility and control
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Our wholesale lockbox service offers:
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© 2023 Wells Fargo & Company.
Deposit products are offered through Wells Fargo Bank, N.A., Member FDIC. Wells Fargo Bank, N.A. is a banking affiliate of Wells Fargo & Company.
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14.I.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: CONSENT CALENDAR
SUBJECT:
Acceptance and authorization for staff to File the City of Hanford's Quarterly Investment Portfolio and Transactions Reports as of 12/31/2023.
RECOMMENDATION: That the City Council accept and authorize staff to file the City of Hanford's Quarterly Investment Portfolio and Transactions Report as of 12/31/2023.
RECOMMENDED MOTION: I move that the City Council accept and authorize staff to file the City of Hanford's Quarterly Investment Portfolio and Transactions Report as of 12/31/2023.
BACKGROUND: Quarterly Investment Report. The City has approximately $113.2 million in investments and cash as of 12/31/2023.
Recent Activity. The City actively maintains its Wells Fargo cash accounts at a minimum of $2.5 million. Typically, idle cash beyond the necessary $2.5 million minimum cash needed for operations is invested into the local government pools such as LAIF. LAIF is currently outperforming the Tulare County Pool by 0.83%. During this period only maturities were re-invested to purchase securities in the 1-3 year maturity range.
Current Investment Environment. At a two-day meeting that starts Tuesday January 30-31, the Fed is expected to hold its key short-term rate steady at a 22-year high of 5.25% to 5.5% for a fourth straight meeting. However, economists are quite confident that the Federal Reserve will begin lowering interest rates as early as March. (USA TODAY)
The 10-year Treasury Note interest is currently down at approximately 4.10% versus 4.27% during last quarter. At the same time last year, the rate was lower at 3.40%.
Proposed Actions. The City will use funds from matured securities to re-invest in 1–3-year securities.
Operations will be monitored for financial needs and when available any large sums of idle cash can be invested. With the City’s practice of investing in government pools and shorter-term securities, there is always availability for quick liquidity if any unexpected financial event were to occur.
Summary. The primary purpose of the City’s cash is to provide residents of Hanford with services. In order to maximize the earnings potential on the City’s idle cash, the City utilizes registered securities dealers to purchase low-risk investments which will provide a higher return versus allowing the cash to be held in savings accounts earning little to no interest. Additionally, idle cash is also held with government pools, including the Tulare County Investment Pool and the State of California LAIF. It is the policy of the City to invest public funds in a manner that will provide a high investment return with
a high level of security while meeting the daily cash flow demands of the entity and conforming to all state and local statutes governing the investment of public funds
FISCAL IMPACT: This item is informational. Investing the City's cash will generate continual interest earnings on the investment portfolio.
ATTACHMENTS:
1. Quarterly Investment Detail Report 12.31.23
2. Quarterly Transactions Report 10.01.23-12.31.23
3. Quarterly Treasurer's Report 12.31.23
ATTACHMENTS:
1. Quarterly Investment Detail Report 12.31.23
2. Quarterly Transactions Report 10.01.23-12.31.23
3. Quarterly Treasurer's Report 12.31.23
Description CUSIP/Ticker Security Sector Settlement Date YTM @ Cost Face Amount/Shares Cost Value Market Value Maturity Date Days To Mat urity % of Portfolio Bank Baroda NY 0.65 7/22/2025 06063HMT7 Certificate Of Deposit 7/22/2020 0.650 198,000.00 198,000.00 185,341.86 7/22/2025 569 0.17 Bank of New York Mellon 1.6 4/24/2025-25 06406RAN7 Corporate 5/13/2020 1.216 1,000,000.00 1,018,368.00 959,730.00 4/24/2025 480 0.88 Barclays Bank 5 6/6/2025 06740KRQ2 Certificate Of Deposit 6/7/2023 5.000 250,000.00 250,000.00 250,010.00 6/6/2025 523 0.22 BMO Harris Bank IL 0.5 3/28/2025-21 05600XAY6 Certificate Of Deposit 9/28/2020 0.500 249,000.00 249,000.00 235,337.37 3/28/2025 453 0.22 Capital Bank 4.65 11/8/2024 139805AX3 Certificate Of Deposit 11/9/2022 4.650 250,000.00 250,000.00 249,002.50 11/8/2024 313 0.22 Capital One 4.8 11/3/2025 14042RVH1 Certificate Of Deposit 11/2/2022 4.800 250,000.00 250,000.00 249,920.00 11/3/2025 673 0.22 Citadel Federal PA 1.65 2/27/2025 17286TAG0 Certificate Of Deposit 2/27/2020 1.650 250,000.00 250,000.00 240,300.00 2/27/2025 424 0.22 Citibank NA 3.65 1/23/2024-23 17325FAS7 Corporate 5/22/2020 1.183 1,000,000.00 1,088,310.00 998,880.00 1/23/2024 23 0.88 Continental Bank UT 0.55 6/26/2025 211163KK5 Certificate Of Deposit 6/26/2020 0.550 175,000.00 175,000.00 163,961.00 6/26/2025 543 0.15 Direct Federal CDT Union 4.7 11/3/2025 25460FDU7 Certificate Of Deposit 11/3/2022 4.700 250,000.00 250,000.00 249,405.00 11/3/2025 673 0. 22 Enerbank UT 0.5 8/29/2025 29278TRA0 Certificate Of Deposit 8/31/2020 0.500 245,000.00 245,000.00 227,793.65 8/29/2025 607 0.22 FHLB 0.5 10/4/2024-22 3130AP4G7 US Agency 10/4/2021 0.500 1,000,000.00 1,000,000.00 966,420.00 10/4/2024 278 0.88 FHLB 0.5 9/24/2024-21 3130ALKN3 US Agency 3/24/2021 0.500 2,000,000.00 2,000,000.00 1,934,960.00 9/24/2024 268 1.77 FHLB 0.57 10/15/2024-22 3130ALWW0 US Agency 4/15/2021 0.570 1,000,000.00 1,000,000.00 965,750.00 10/15/2024 289 0.88 FHLB 5.125 5/28/2026-24 3130AWAA8 US Agency 5/30/2023 5.125 1,000,000.00 1,000,000.00 995,750.00 5/28/2026 879 0.88 FHLB 5.5 11/24/2025-23 3130AWBD1 US Agency 6/1/2023 5.500 2,000,000.00 2,000,000.00 1,994,800.00 11/24/2025 694 1.77 FHLB Step 1/27/2025-22 3130AQML4 US Agency 1/27/2022 1.370 325,000.00 325,000.00 314,119.00 1/27/2025 393 0.29 FHLMC 5.32 6/6/2025-24 3134GYTM4 US Agency 6/6/2023 5.320 1,000,000.00 1,000,000.00 997,400.00 6/6/2025 523 0.88 First Choice Bank CA 0.4 9/30/2025-21 319461DB2 Certificate Of Deposit 9/30/2020 0.400 249,000.00 249,000.00 230,367.33 9/30/2025 639 0.2 2 First National Bank TX 1.8 12/30/2024 32112UDJ7 Certificate Of Deposit 12/30/2019 1.800 250,000.00 250,000.00 241,837.50 12/30/2024 365 0 .22 First Technology Federal 5.1 6/16/2025 33715LFK1 Certificate Of Deposit 6/16/2023 5.100 250,000.00 250,000.00 250,412.50 6/16/2025 533 0. 22 Greenstate Credit Union 0.5 7/30/2024 39573LBQ0 Certificate Of Deposit 7/30/2021 0.500 250,000.00 250,000.00 243,415.00 7/30/2024 212 0.2 2 Horizon Bk 4.75 11/8/2024 44042WCG0 Certificate Of Deposit 11/8/2022 4.750 250,000.00 250,000.00 249,182.50 11/8/2024 313 0.22 Insight4.6 5/2/2025 45791JAA4 Certificate Of Deposit 11/2/2022 4.600 250,000.00 250,000.00 248,605.00 5/2/2025 488 0.22 John Deer Capital 2.6 3/7/2024 24422EUX5 Corporate 5/15/2020 1.160 700,000.00 737,464.00 696,017.00 3/7/2024 67 0.62 Jonesboro State Bank LA 0.8 5/29/2025-20 48040PGX7 Certificate Of Deposit 5/29/2020 0.800 249,000.00 249,000.00 234,752.22 5/29/2025 515 0.22 Luana Savings Bank IA 0.45 7/29/2025 549104RJ8 Certificate Of Deposit 7/29/2020 0.450 250,000.00 250,000.00 233,105.00 7/29/2025 576 0.22 Medallion Bank UT 0.55 7/30/2025 58404DHQ7 Certificate Of Deposit 7/30/2020 0.550 250,000.00 250,000.00 233,337.50 7/30/2025 577 0.22 Merrick Bank UT 1.85 12/31/2024 59013KEP7 Certificate Of Deposit 12/31/2019 1.850 250,000.00 250,000.00 241,927.50 12/31/2024 366 0.22 Partners Bank AK 0.6 6/30/2025 70212VAB4 Certificate Of Deposit 6/30/2020 0.600 250,000.00 250,000.00 234,252.50 6/30/2025 547 0.22 Pentagon Federal Credit Union 0.55 9/30/2024 70962LAR3 Certificate Of Deposit 9/29/2021 0.550 250,000.00 250,000.00 241,615.00 9/30/202 4 274 0.22 Sallie Mae Bank UT 1.9 10/30/2024 7954504Z5 Certificate Of Deposit 10/30/2019 1.900 100,000.00 100,000.00 97,363.00 10/30/2024 304 0.09 State Bank of India GA 0.95 6/26/2025 856283N69 Certificate Of Deposit 6/26/2020 0.950 250,000.00 250,000.00 234,760.00 6/26/2025 543 0.2 2 Synchrony Bank 0.9 12/10/2024 87165HK41 Certificate Of Deposit 12/10/2021 0.900 250,000.00 250,000.00 240,217.50 12/10/2024 345 0.22 Texas Exchange Bank TX 0.5 7/30/2024 88241TLS7 Certificate Of Deposit 7/30/2021 0.500 249,000.00 249,000.00 242,443.83 7/30/2024 212 0.22 Toyota Motor Credit 0.45 1/11/2024 89236THU2 Corporate 9/20/2021 0.450 1,000,000.00 1,000,000.00 998,850.00 1/11/2024 11 0.88 United Heritage 4.75 11/4/2025 91334AAE3 Certificate Of Deposit 11/4/2022 4.750 250,000.00 250,000.00 249,660.00 11/4/2025 674 0.22 Sub Total / Average Brokerage | Higgins Capital 2.234 18,239,000.00 18,383,142.00 17,821,001.26 413 16.11 Ally Bank5.15 12/9/2024 02007GN90 Certificate Of Deposit 6/8/2023 5.150 250,000.00 250,000.00 250,010.00 12/9/2024 344 0.22 Austin Telco FCU 4.95 7/26/2024 052392CL9 Certificate Of Deposit 1/27/2023 4.950 250,000.00 250,000.00 249,827.50 7/26/2024 208 0.22 Bank Hapoalim BM NY 5.2 12/9/2024 06251A5Q9 Certificate Of Deposit 6/9/2023 5.200 250,000.00 250,000.00 250,022.50 12/9/2024 344 0.22 FFCB 4.92 1/12/2026 3133ENR77 US Agency 12/7/2022 4.920 1,000,000.00 1,000,000.00 994,680.00 1/12/2026 743 0.88 FFCB 5.58 12/7/2026 3133EPK38 US Agency 12/7/2023 5.580 1,000,000.00 1,000,000.00 999,920.00 12/7/2026 1,072 0.88 FHLB 5 12/12/2024 3130ATXG7 US Agency 12/12/2022 5.000 1,000,000.00 1,000,000.00 996,590.00 12/12/2024 347 0.88 FHLB 5.5 11/24/2025-23 3130AW5T3 US Agency 6/1/2023 5.500 1,000,000.00 1,000,000.00 999,560.00 11/24/2025 694 0.88 FHLMC 5.3 2/27/2026-23 3134GYJB9 US Agency 5/26/2023 5.300 2,000,000.00 2,000,000.00 1,992,900.00 2/27/2026 789 1.77 FHLMC 5.3 5/15/2025-23 3134GYRH7 US Agency 5/26/2023 5.300 1,000,000.00 1,000,000.00 997,130.00 5/15/2025 501 0.88 FHLMC 5.65 3/13/2026-23 3134GYKT8 US Agency 11/17/2023 5.650 950,000.00 950,000.00 948,898.00 3/13/2026 803 0.84 First Carolina Bank 5.25 7/15/2024 31944MCU7 Certificate Of Deposit 6/14/2023 5.250 250,000.00 250,000.00 250,057.50 7/15/2024 197 0.22 General Electric Credit Union 5 1/30/2024 369674CG9 Certificate Of Deposit 1/30/2023 5.000 250,000.00 250,000.00 249,925.00 1/30/2024 30 0.22 IC Federal Credit Union 5 6/10/2024 44931EAD3 Certificate Of Deposit 12/9/2022 5.000 240,000.00 240,000.00 239,908.80 6/10/2024 162 0.21 Liberty Fed Credit Union 4.9 12/9/2024 53052LAE9 Certificate Of Deposit 12/9/2022 4.900 250,000.00 250,000.00 249,422.50 12/9/2024 344 0. 22 NORTHEAST COMMUNITY BANK 5.2 12/13/2024 664122BN7 Certificate Of Deposit 12/15/2023 5.200 250,000.00 250,000.00 250,110.00 12/13/2024 34 80 . 2 2 PREFERRED BANK LA CALIF 5.2 12/20/2024 740367SU2 Certificate Of Deposit 12/22/2023 5.200 250,000.00 250,000.00 250,115.00 12/20/2024 355 0.22 SUTTER HEALTH 1.321 8/15/2025 86944BAF0 Corporate 12/6/2023 5.525 874,000.00 815,450.74 818,841.86 8/15/2025 593 0.77 Valley Strong 4.9 1/31/2024 920133AM7 Certificate Of Deposit 1/31/2023 4.900 250,000.00 250,000.00 249,900.00 1/31/2024 31 0.22 WESTERN ALLIANCE BK PHOENIX 5.25 5/24/2024 95763PMY4 Certificate Of Deposit 5/26/2023 5.250 250,000.00 250,000.00 249,965.00 5/24/2024 1 45 0.22 Zions Bank Corp 5.2 12/6/2024 98970LFU2 Certificate Of Deposit 6/7/2023 5.200 250,000.00 250,000.00 250,127.50 12/6/2024 341 0.22 Sub Total / Average Brokerage | Multi-Bank Securities 5.277 11,814,000.00 11,755,450.74 11,737,911.16 586 10.43 FHLB 2.3 3/28/2025-22 3130AREM9 US Agency 3/28/2022 2.300 250,000.00 250,000.00 243,879.01 3/28/2025 453 0.22 Wells Fargo Securities MM WFMM5968 Money Market 11/3/2021 5.220 224,673.84 224,673.84 224,673.84 N/A 1 0.20 Sub Total / Average Brokerage | Wells Fargo Securities 3.682 474,673.84 474,673.84 468,552.85 239 0.42 Local Agency Investment Fund LGIP LAIF6352 Local Government Investment Pool 2/28/2009 3.929 22,476,072.70 22,476,072.70 22,476,072.70 N /A 1 19.85 Sub Total / Average LGIP | LAIF 3.929 22,476,072.70 22,476,072.70 22,476,072.70 1 19.85 Tulare County Pool LGIP TULARE860 Local Government Investment Pool 5/5/2017 3.104 47,425,711.91 47,425,711.91 47,425,711.91 N/A 1 41.89 Sub Total / Average LGIP | Tulare County 3.104 47,425,711.91 47,425,711.91 47,425,711.91 1 41.89 Umpqua MM MM7248 Money Market 8/19/2022 0.010 4,000,538.03 4,000,538.03 4,000,538.03 N/A 1 3.53 Sub Total / Average Umpqua Bank 0.010 4,000,538.03 4,000,538.03 4,000,538.03 1 3.53 US Bank Cash USBANK Cash 10/31/2022 0.000 839,309.44 839,309.44 839,309.44 N/A 1 0.74 Sub Total / Average US Bank Custodian | Fixed Assets 0.000 839,309.44 839,309.44 839,309.44 1 0.74 Umpqua Bank
US Bank Custodian | Fixed Assets
Wells Fargo | Operating Accounts
City of Hanford
Quarterly Investment Detail Report
As of 12/31/2023
Brokerage | Higgins Capital
Brokerage | Multi-Bank Securities
Brokerage | Wells Fargo Securities
LGIP | LAIF
LGIP | Tulare County
Description CUSIP/Ticker Security Sector Settlement Date YTM @ Cost Face Amount/Shares Cost Value Market Value Maturity Date Days To Mat urity % of Portfolio City of Hanford
Quarterly Investment Detail Report
As of 12/31/2023Wells Fargo | General Account Cash WFGENERAL5186 Cash 10/31/2007 0.000 30,400.00 30,400.00 30,400.00 N/A 1 0.03 Wells Fargo | Self Insurance Cash WFSELFINS1892 Cash 6/30/2020 0.000 233,893.25 233,893.25 233,893.25 N/A 1 0.21 Wells Fargo | Sweep Cash WFSWEEP5186 Cash 6/30/2020 0.000 7,689,251.11 7,689,251.11 7,689,251.11 N/A 1 6.79 Sub Total / Average Wells Fargo | Operating Accounts 0.000 7,953,544.36 7,953,544.36 7,953,544.36 1 7.02 Total / Average 3.006 113,222,850.28 113,308,443.02 112,722,641.71 129 100
Description CUSIP/Ticker Settlement Date Face Amount/Shares Principal Total Portfolio Name FFCB 5.58 12/7/2026 3133EPK38 12/7/2023 1,000,000.00 1,000,000.00 1,000,000.00 Brokerage | Multi-Bank Securities FHLMC 5.65 3/13/2026-23 3134GYKT8 11/17/2023 950,000.00 950,000.00 959,542.22 Brokerage | Multi-Bank Securities NORTHEAST COMMUNITY BANK 5.2 12/13/2024 664122BN7 12/15/2023 250,000.00 250,000.00 250,000.00 Brokerage | Multi-Bank Securities PREFERRED BANK LA CALIF 5.2 12/20/2024 740367SU2 12/22/2023 250,000.00 250,000.00 250,000.00 Brokerage | Multi-Bank Securities SUTTER HEALTH 1.321 8/15/2025 86944BAF0 12/6/2023 874,000.00 815,450.74 819,010.61 Brokerage | Multi-Bank Securities Citbank National SD 3.55 11/24/2023 17312QW47 11/24/2023 250,000.00 250,000.00 250,000.00 Brokerage | Higgins Capital Goldman Sachs 0.6 12/15/2023 38149MQ22 12/15/2023 224,000.00 224,000.00 224,000.00 Brokerage | Wells Fargo Securities IADB 0.25 11/15/2023 4581X0DP0 11/15/2023 500,000.00 500,000.00 500,000.00 Brokerage | Wells Fargo Securities IFC 0.61 11/24/2023 45950VQS8 11/24/2023 1,000,000.00 1,000,000.00 1,000,000.00 Brokerage | Wells Fargo Securities Live Oak Bank 0.5 12/11/2023 538036TF1 12/11/2023 250,000.00 250,000.00 250,000.00 Brokerage | Higgins Capital State Bank of India 0.55 11/29/2023 856285YX3 11/29/2023 250,000.00 250,000.00 250,000.00 Brokerage | Wells Fargo Securities Sunset Science Park FCU 5 12/14/2023 86777TAA4 12/14/2023 250,000.00 250,000.00 250,000.00 Brokerage | Multi-Bank Securities Trustone Financial CU 5 12/14/2023 89841MAM9 12/14/2023 250,000.00 250,000.00 250,000.00 Brokerage | Multi-Bank Securities Caterpillar Financial 3.75 12/24/2023 14912L5X5 11/24/2023 1,000,000.00 1,000,000.00 1,000,000.00 Brokerage | Higgins Capital Buy
Matured
City of Hanford
Quarterly Transactions Report
10/01/23-12/31/23
CITY OF HANFORD, CALIFORNIA
Treasurer's Report
December 31, 2023
Performance
Weighted Average Yield 3.013%
Diversification | Security Sector % of Portfolio YTM @Cost Days to Maturity
Face Amount /
Shares Cost Value Market Value
Cash 7.80% 0.00% 1 8,792,854 8,792,854 8,792,854
Money Market 3.75% 0.29% 1 4,225,212 4,225,212 4,225,212 Local Government Investment Pool 62.01% 3.37% 1 69,901,785 69,901,785 69,901,785 Certificate of Deposit | Negotiable 7.97% 3.14% 395 9,204,000 9,204,000 8,987,717 Corporate Bonds 3.97% 1.82% 230 4,574,000 4,659,593 4,472,319 US Agency Bonds 14.50% 4.07% 598 16,525,000 16,525,000 16,342,756 100.00% 3.013% 128 113,222,850 113,308,443 112,722,642
7.80%
3.75%
62.01%
7.97%3.97%
14.50% 12/31/2023
Cash
Money Market
Local Government Investment Pool
Certificate of Deposit | Negotiable
Corporate Bonds
US Agency Bonds
15.A.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: PUBLIC HEARING
SUBJECT:
Public Hearing and consideration of approval of Resolution 24-03-R for City of Hanford wastewater rate adjustments effective March 1, 2024.
RECOMMENDATION:
Recommendation: Staff recommends Council hold a Public Hearing and consider approval of Resolution 24-03-R for City of Hanford wastewater rate adjustments effective March 1, 2024.
Recommended Motion: I move to adopt Resolution 24-03-R for City of Hanford wastewater rate adjustments effective March 1, 2024.
BACKGROUND:
City Council has the authority to approve rate changes when necessary to ensure the continued recovery of costs for services and to secure reinvestment into the system infrastructure for long term sustainability. The Council accepted the “Water, Wastewater, and Stormwater Utility Rate Study 2023”, dated November 7, 2023. Today, staff recommends that City Council approve and implement wastewater rates according to the adopted study. Water rates were approved to be implemented at City Council's January 16, 2024 meeting. Staff recommends deferring stormwater rate changes at this time.
It has been over thirteen years since wastewater (sanitary sewer) increases. The last wastewater rate increase was July 1, 2011 (adopted in Resolution No. 09-77-R on November 17, 2009). Without updating rates the City will not have long term sustainability to keep up with costs of maintenance, capital and increased costs of doing business. Should rate changes not be approved, this fund (wastewater) is at risk of having a negative fund balance and not being able to self-sustain without significant deferrals on projects and/or operations.
Proposition 218 (Prop 218), approved in 1996, adds Article XIII D (Voter Approval for Local Tax Levies) to the California Constitution. All property-related fees, such as water, wastewater and storm drain fees and charges, must meet Prop 218’s requirements. It applies to most utility charges and fees; however, electric and gas utility charges were specifically exempted from the definition of property-related charges in the statute. The City is required to provide notice of proposed increases to the sewer, stormwater, water and refuse collection service fees and charges to all affected ratepayers and record receipt of all written protests during a public hearing. Prop 218 prohibits increases to fees and charges if a majority of the affected ratepayers submit written opposition to proposed increases.
The City's consultant, Lechowicz & Tseng Municipal Consultants and staff provided Council with a look at the needs of the water, wastewater and stormwater enterprises at the September 19, 2023, November 7, 2023 and January 16, 2024 City Council Meetings. After receiving Council direction and authorization to proceed at those meetings, staff and the consultant with review by the City Attorney sent out notification to all landowners and utility customers within the City as required by the Proposition 218 process. Water rate changes were approved at the January 16, 2024 meeting and the public hearing was continued to the February 6, 2024 meeting for further consideration of wastewater and stormwater rates. After internal discussion between staff, city attorney and the consultant, staff recommends to defer stormwater rate changes at this time. Should the City move forward on stormwater rate changes in the future, notice will be provided again as required by State law.
Utility operations in water, sewer and stormwater (storm drain) are self-supporting enterprise funds that provide services for a fee. Charges for service through rates are the primary source of funding for operations and also fund a significant portion of the capital improvement program which includes the debt service (principal and interest) for bonds issued to fund these projects. Developer fees are the other funding source for capital projects. However, impact fees paid by developers are legally limited to addressing the impacts caused by the impacts of the developers' projects. For example, a project's impact fees may not be utilized to address normal wear and tear to infrastructure improvements that are not caused by that project.
The City's utilities are faced with many current and future challenges including aging infrastructure, preserving groundwater supply, adapting to changing water and wastewater quality regulations, and increased operational and capital costs. A growing proportion of Hanford's utility infrastructure is aging beyond its expected useful life. For example, the expected useful life of a wastewater distribution pipeline is 40 years, and the City's Wastewater Treatment Plant operates 24 hours a day, capital needs will continue. Hanford's operational costs are not immune to the impacts of inflation, which increase construction and equipment costs as well. In addition, adequate fund balance must be maintained to maintain applicable bond requirements and sustain operations in event of a fiscal emergency.
Notices by mail and on the City's website were posted before the 45-day notice requirement for the public hearing on January 16, 2024, the public hearing was continued to February 6, 2024 for wastewater and stormwater rates. The proposed rates for wastewater are recommended to go into effect as of March 1, 2024 for the March 2024 utility bill. Attachment 'A' “Water, Wastewater, and Stormwater Utility Rate Study 2023”, dated November 7, 2023, includes details on the proposed wastewater rates. Subsequent increases would go into effect on July 1 from 2024 through 2027.
Stormwater rate changes are not recommended at this time and will remain at current rates. New notification (in compliance with State law) will occur when changes to the stormwater rates are recommended.
Staff recommends that the City continue to look at needs for any rate adjustments (up or down), at a minimum, every five years in order to mitigate the need for large increases as much as possible.
FISCAL IMPACT:
Rates are proposed to increase as follows:
Wastewater - Year 1: 35%, Year 2 & 3: 12%, Year 4 & 5: 5% Storm Drain - no change at this time
The proposed five-year wastewater utility rate plan will fund future operating and capital costs, maintain reserve levels and financial metrics that comply with approved fiscal and reserve policies,
and maintain current bond ratings to keep current and potential borrowing costs for capital investments low.
ATTACHMENTS:
1. RESOLUTION 24-03-R
2. Attachment 'A' - Rate Report Final 11.7.23
3. City of Hanford_8.5x11_Prop 218 Notice_111423
RESOLUTION NO. 24-02-R
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HANFORD UPDATING
WASTEWATER RATES
At a regular meeting of the City Council of the City of Hanford duly called and held on the 6 th day of February 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 potential rates on September 19, 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, a public hearing was continued to consider the proposed rates for wastewater and any protests to such rates was held on this date, February 6, 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 s t e 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 defer changes of stormwater rates and re-notice property owners upon reconsideration;
NOW, THEREFORE, BE IT RESOLVED that the rates on Exhibit “A” are approved, effective March 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 6th day of February 2024 by the following vote:
AYES: __________________________
NOES: __________________________
ABSTAIN: __________________________
ABSENT: __________________________
_______________________
Travis Paden
MAYOR of the City of Hanford
Attest:
_______________________
Natalie Corral
City Clerk
CITY OF HANFORD
Water, Wastewater, and Stormwater
Utility Rate Study 2023
FINAL REPORT
November 7, 2023
909 Marina Village Parkway #135
Alameda, CA 94501
(510) 545-3182
www.LTmuniconsultants.com
City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023
TABLE OF CONTENTS
Section 1: INTRODUCTION ......................................................................................................................... 1
1.1 Background ................................................................................................................................... 1
1.2 Requirements of Proposition 218 ................................................................................................. 1
1.3 Rate Study Process ........................................................................................................................ 2
1.4 Summary of Proposed Rates ......................................................................................................... 4 Section 2: CURRENT RATES AND CUSTOMER BASE ................................................................................. 10
2.1 Current Water Rates ................................................................................................................... 10
2.2 Water Customer Base and Current Water Sales Revenues ........................................................ 11
2.3 Current Wastewater Rates.......................................................................................................... 13
2.4 Wastewater Customer Base and Current Revenues ................................................................... 14
2.5 Current Storm Drainage Rates and Revenues ............................................................................ 16 Section 3: WATER REVENUE REQUIREMENT ........................................................................................... 17
3.1 Water System Overview ............................................................................................................. 17
3.2 Water Reserves ........................................................................................................................... 17
3.3 Water Capital Improvement Plan ............................................................................................... 18
3.4 Water Cash Flow Projection ........................................................................................................ 18 Section 4: WATER COST ALLOCATION AND RATE DESIGN ....................................................................... 22
4.1 Water Cost Allocation ................................................................................................................. 22
4.2 Billing Units ................................................................................................................................. 24
4.3 Water Rate Design ...................................................................................................................... 26
4.4 Water Rate Derivation ................................................................................................................ 27
4.5 Water Bill Impacts ....................................................................................................................... 32 Section 5: WASTEWATER REVENUE REQUIREMENT................................................................................ 35
5.1 Wastewater System Overview .................................................................................................... 35
5.2 Wastewater Reserves ................................................................................................................. 35
5.3 Wastewater Capital Improvement Plan ...................................................................................... 35
5.4 Wastewater Cash Flow Projection .............................................................................................. 36 Section 6: WASTEWATER COST ALLOCATION AND RATE DESIGN ........................................................... 41
6.1 Wastewater Cost Allocation ....................................................................................................... 41
6.2 Wastewater Rate Design ............................................................................................................. 42
6.3 Wastewater Flows....................................................................................................................... 43
6.4 Wastewater Rate Derivation ....................................................................................................... 44
6.5 Wastewater Bill Impacts ............................................................................................................. 46 Section 7: STORM DRAINAGE REVENUE REQUIREMENT ......................................................................... 51
7.1 Storm Drainage System Overview .............................................................................................. 51
7.2 Storm Drainage Reserves ............................................................................................................ 51
7.3 Storm Drainage Capital Improvement Plan ................................................................................ 51
7.4 Storm Drainage Cash Flow Projection......................................................................................... 52
City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023
Section 8: STORM COST ALLOCATION AND RATE DESIGN ....................................................................... 55
8.1 Storm Drainage Cost Allocation .................................................................................................. 55
8.2 Storm Drainage Fee Design ......................................................................................................... 57
8.3 Cost Allocation Results ................................................................................................................ 59
8.4 Proposed Storm Drainage Rates ................................................................................................. 60
8.5 Storm Drainage Survey ............................................................................................................... 60
8.6 Annual Parcel Database Review .................................................................................................. 61
City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023
LIST OF TABLES
Table 1: Proposed Monthly Water Rates ...................................................................................................... 5 Table 2: Proposed Wastewater Rates ........................................................................................................... 6 Table 3: Proposed Monthly Storm Drainage Fees ........................................................................................ 7 Table 4: Current Monthly Water Rates ....................................................................................................... 11 Table 5: Estimated Water Service Sales Revenues from Billing Data, FY 2022/23 ..................................... 12 Table 6: Current Wastewater Rates ............................................................................................................ 14 Table 7: Estimated Wastewater Service Charge Revenues from Billing Data, FY 2022/23 ........................ 15 Table 8: Current Storm Drainage Rates ...................................................................................................... 16 Table 9: Water Capital Improvement Plan (rate funded) ........................................................................... 18 Table 10: Water Cash Flow Projection ........................................................................................................ 21 Table 11: Water Cost Allocation ................................................................................................................. 23 Table 12: Annual Revenue Requirement Allocation ................................................................................... 24 Table 13: Number of Meter Equivalents (Total Inside & Outside City Accounts)....................................... 25 Table 14: Projected Customer Growth & Water Consumption .................................................................. 26 Table 15: Water Fixed Charge Derivation ................................................................................................... 28 Table 16: Consumption Charge Rate Derivation ......................................................................................... 29 Table 17: Consumption Charge Rate Derivation - Drought Rates .............................................................. 30 Table 18: Proposed Monthly Water Rates .................................................................................................. 31 Table 19: Sample Monthly Residential Water Bill Impacts ......................................................................... 32 Table 20: Wastewater Capital Improvement Plan (rate funded) ............................................................... 36 Table 21: Wastewater Cash Flow Projection .............................................................................................. 39 Table 22: Wastewater Cost Allocation ........................................................................................................ 42 Table 23: Annual Sewer Flows & Loadings ................................................................................................. 43 Table 24: Unit Cost Calculation ................................................................................................................... 44 Table 25: Sewer Rate Calculation ............................................................................................................... 45 Table 26: Proposed Wastewater Rates ....................................................................................................... 46 Table 27: Proposed Wastewater Rate Increases ........................................................................................ 47 Table 28: Sample Monthly Non-Residential/Commercial Sewer Bill Impacts ............................................ 49 Table 29: Storm Drainage Capital Improvement Program (CIP) ................................................................. 52 Table 30: Storm Drainage Cash Flow Projection ......................................................................................... 54 Table 31: Estimated of Acreage & Impervious Area ................................................................................... 57 Table 32: Storm Drainage Fee Calculation .................................................................................................. 58 Table 33: Proposed Storm Drainage Fees ................................................................................................... 60
City of Hanford
Water, Wastewater, and Stormwater Utility Rate Study 2023
LIST OF FIGURES
Figure 1: Comprehensive Cost of Service Study Process .............................................................................. 3 Figure 2: Single Family Residential Monthly Water, Sewer, and Storm Average Bill ................................... 8 Figure 3: Single Family Residential Monthly Water, Sewer, and Refuse Bill Survey .................................... 9 Figure 4: Water Cash Flows ......................................................................................................................... 20 Figure 5: Monthly Single Family Residential Water Bill Survey .................................................................. 33 Figure 6: Fixed Monthly Meter Charge Survey ........................................................................................... 34 Figure 7: Wastewater Cash Flows ............................................................................................................... 38 Figure 8: Monthly Single Family Residential Wastewater Bill Survey ......................................................... 48 Figure 9: Commercial Monthly Wastewater Bill Surveys by Strength Category ........................................ 50 Figure 10: Storm Drainage Cash Flows ....................................................................................................... 53 Figure 11: Current vs. Proposed Storm Drainage Revenue Recovery ........................................................ 59 Figure 12: Storm Drainage Residential Monthly Bill Survey ....................................................................... 61
City of Hanford Page 1 Water, Wastewater, and Stormwater Utility Rate Study 2023
SECTION 1: INTRODUCTION
1.1 Background
The City of Hanford (City) is located in the southern portion of the San Joaquin Valley and is the county seat of Kings County, California. The City was incorporated in 1891. The City provides water, wastewater, and storm drainage service to a population of over 56,000 residents in addition to businesses and industrial facilities. The water, wastewater, and storm drainage enterprise funds are self-supported from rates and charges and fund the operations and capital project budgets of the Utilities and Wastewater branches of the Public Works Department.
The City Council approved the last formal rate studies in 2015 for the water utility and 2009 for the wastewater and storm drainage utilities. Water rates were last increased July 1, 2018, and wastewater and storm drainage rates were last increased July 1, 2011. Since then, the City has experienced a number of unanticipated changes necessitating a rate reevaluation including COVID-19, economic inflation, and water supply issues as well as the development of new Master Plans for all three utilities.
The City engaged Lechowicz & Tseng Municipal Consultants (L&T) to complete a comprehensive water, wastewater (sewer), and storm drainage (storm) rate study to recommend utility rates that will generate sufficient revenues to recover the full cost of services and ensure the continued financial health of the City’s enterprise funds. This rate study covers the five-year period beginning in Fiscal Year (FY) 2023/24 through 2027/28.
1.2 Requirements of Proposition 218
The implementation of utility rates in California is governed by the substantive and procedural requirements of Proposition 218 the “Right to Vote on Taxes Act” which is codified as Articles XIIIC and XIIID of the California Constitution. The City must follow the procedural requirements of Proposition 218 for all utility rate increases. These requirements include:
1. Noticing Requirement – The City must mail a notice of the proposed rate increases to all affected property owners or ratepayers. The notice must specify the amount of the fee, the basis upon which it was calculated, the reason for the fee, and the date/time/location of a public rate hearing at which the proposed rates will be considered/adopted.
2. Public Hearing – The City must hold a public hearing prior to adopting the proposed rate increases. The public hearing must be held not less than 45 days after the required notices are mailed.
3. Rate Increases Subject to Majority Protest – At the public hearing, the proposed rate increases are subject to majority protest. If more than 50% of affected property owners or ratepayers submit written protests against the proposed rate increases, the increases cannot be adopted.
City of Hanford Page 2 Water, Wastewater, and Stormwater Utility Rate Study 2023
Proposition 218 also established substantive requirements that apply to water, wastewater, and storm rates and charges, including:
1. Cost of Service – Revenues derived from the fee or charge cannot exceed the funds required to provide the service. In essence, fees cannot exceed the “cost of service”.
2. Intended Purpose – Revenues derived from the fee or charge can only be used for the purpose for which the fee was imposed.
3. Proportional Cost Recovery – The amount of the fee or charge levied on any customer shall not exceed the proportional cost of service attributable to that customer.
4. Availability of Service – No fee or charge may be imposed for a service unless that service is used by, or immediately available to, the owner of the property.
5. General Government Services – No fee or charge may be imposed for general governmental services where the service is available to the public at large.
Charges for water, wastewater, and storm service are exempt from additional voting requirements of Proposition 218, provided the charges do not exceed the cost of providing service and are adopted pursuant to the procedural requirements of Proposition 218. In 2017, the State passed Senate Bill 231 clarifying the definition of “sewer” in Proposition 218 to include both sanitary and storm sewer, and thereby exempting storm drain rates from the additional ballot requirement.
1.3 Rate Study Process
This section details the development of the City’s water, wastewater, and storm rates via the Proposition 218 process as shown in the following figure.
City of Hanford Page 3 Water, Wastewater, and Stormwater Utility Rate Study 2023
Figure 1: Comprehensive Cost of Service Study Process
The following is a brief description of the rate study process:
Revenue Requirements - Revenue requirements are analyzed via financial plans developed from the Water, Wastewater, and Storm Drain Fund budgets. Based on the best information currently available, the financial plans incorporate projected operation and maintenance costs, capital expenditures, debt service, and growth to estimate annual revenue requirements. The plans serve as a roadmap for funding the City’s future operating and capital programs while maintaining long-term fiscal stability.
Cost of Service Allocation - The cost of service process builds on the financial plan analysis and assigns water and sewer system costs to functional cost components: metering and customer service, base, and extra for water, and customer service, flow, BOD, and SS for sewer. Storm drain service costs are allocated to customers based on parcel size and impervious (paved) area.1
1 Single family residential (SFR) parcels are proposed to be charged based on average SFR parcel size within the City
City of Hanford Page 4 Water, Wastewater, and Stormwater Utility Rate Study 2023
Rate Design - Rate design involves developing a rate structure that proportionately recovers costs from customers. Final rate recommendations are designed to (a) fund the utilities’ short- and long-term costs of providing service; (b) proportionately allocate costs to all customers and customer classes; and (c) comply with the substantive requirements of Proposition 218.
1.4 Summary of Proposed Rates
The proposed water, wastewater, and storm drain rates were developed to fairly recover costs, adhere to California statute, and be affordable to customers. The rates developed were based on the best available information gathered from City budgets, audits, and input from staff and City Council. The cost allocations proposed herein are based on American Water Works Association methodologies and industry standard practice. The proposed rates are based on the reasonable cost of providing service and are proportional to the benefits received by each customer.
Current and proposed monthly water rates are provided in Table 1. As an update to the current rates, it is proposed that customers be billed the same rates regardless of whether their property is inside the City limits. The projected water rates also include a schedule of drought rates, which would only be implemented during a water shortage emergency.
City of Hanford Page 5 Water, Wastewater, and Stormwater Utility Rate Study 2023
Table 1: Proposed Monthly Water Rates City of Hanford Utility Rate Study
Current
Rates [1]
PROPOSED
Fiscal Year FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2018 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027
METER CHARGES
5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 1-1/2" & 2" $21.88 $31.89 $36.34 $39.62 $41.23 $42.91 3" & 4" $34.83 $95.56 $108.90 $118.73 $123.55 $128.58 6" $54.26 $292.35 $333.16 $363.26 $378.01 $393.37
8" $80.17 $465.99 $531.04 $579.02 $602.53 $627.01
CONSUMPTION CHARGES ($/CCF)
All Customers $1.34 $1.94 $2.24 $2.44 $2.54 $2.64
DROUGHT CONSUMPTION CHARGES ($/CCF) [2]
10% Water Cutback $2.10 $2.42 $2.64 $2.75 $2.86
20% Water Cutback $2.30 $2.65 $2.89 $3.01 $3.13
35% Water Cutback $2.72 $3.13 $3.41 $3.55 $3.69
50% Water Cutback $3.38 $3.89 $4.24 $4.41 $4.59
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 1 - Current rates shown are for Inside City customers. Inside & Outside City customers are proposed to be billed the same rates going forward. Current meter charges shown are the sum of the service connection charge and the meter fee.
2 - Only to be implemented temporarily during water shortage emergencies.
Current and proposed monthly wastewater rates are provided in Table 2. The proposed monthly storm rates are provided in Table 3. Currently, wastewater and stormwater rates are billed together as a single charge. Of the existing wastewater system charges adopted in the City’s Resolution No. 09-77-R, 78.0% of the service charges for each customer are allocated to the wastewater system, and the remaining
22.0% are allocated to the stormwater system. It is recommended that the City levy storm drain charges based on land use type and parcel size to better reflect the proportional cost of service provided to each customers. Single family residential customers are proposed to be billed a fixed fee based on the average parcel size while all other customer types will be charged an individual rate based on their parcel’s acreage. Parcels with indeterminate acreage will be billed a minimum charge according to their customer class.
City of Hanford Page 6 Water, Wastewater, and Stormwater Utility Rate Study 2023
Table 2: Proposed Wastewater Rates City of Hanford
Utility Rate Study
Current PROPOSED
Customer Class Rates FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2011 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027
RESIDENTIAL (Per dwelling unit)
Single Family $17.86 $24.67 $27.63 $30.95 $32.50 $34.13 Multi-Family/Duplex $16.93 $18.51 $20.73 $23.22 $24.38 $25.60
NON-RESIDENTIAL
Metered Water ($/CCF) [1]
Group A: Domestic $1.54 $3.08 $3.45 $3.86 $4.05 $4.25 Group B: Low Strength $1.44 $2.81 $3.15 $3.53 $3.71 $3.90 Group C: Medium Strength $2.15 $3.95 $4.42 $4.95 $5.20 $5.46 Group D: High Strength $2.88 $5.34 $5.98 $6.70 $7.04 $7.39
Schools (per student ADA) [2] $0.51 $0.74 $0.83 $0.93 $0.98 $1.03 Septage (per 1,000 gallons) $26.19 $35.03 $39.23 $43.94 $46.14 $48.45 Industrial
Flow (per mg) $1,561.56 $2,497.17 $2,796.83 $3,132.45 $3,289.07 $3,453.52 BOD (per lb) $0.173 $0.557 $0.623 $0.698 $0.733 $0.770 SS (per lb) $0.167 $0.558 $0.625 $0.700 $0.735 $0.772 CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons; Mg – million gallons; BOD – biological oxygen demand; SS – suspended solids
1 - Per hundred cubic feet (ccf) 2 - ADA - average daily attendance
City of Hanford Page 7 Water, Wastewater, and Stormwater Utility Rate Study 2023
Table 3: Proposed Monthly Storm Drainage Fees
City of Hanford
Utility Rate Study
Current PROPOSED
Rates FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2011 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027
SINGLE FAMILY RESIDENTIAL $5.04 $4.57 $4.79 $5.03 $5.29 $5.55 (per account)
ALL OTHER CUSTOMERS (per acre)
Business
$43.25 $45.42 $47.69 $50.07 $52.57
Industrial $38.45 $40.37 $42.39 $44.51 $46.73
Low Density $4.81 $5.05 $5.30 $5.56 $5.84
Multi-Family $28.84 $30.28 $31.79 $33.38 $35.05
Public Agency $43.25 $45.42 $47.69 $50.07 $52.57
Schools $7.21 $7.57 $7.95 $8.35 $8.76
BASE CHARGE (per account) [1]
Business
$8.65 $9.08 $9.54 $10.01 $10.51
Industrial $7.69 $8.07 $8.48 $8.90 $9.35
Low Density $0.96 $1.01 $1.06 $1.11 $1.17
Multi-Family $5.77 $6.06 $6.36 $6.68 $7.01
Public Agency $8.65 $9.08 $9.54 $10.01 $10.51
Schools $1.44 $1.51 $1.59 $1.67 $1.75
1 - Charge for storm drain accounts that the City does not currently have parcel size for
For all three utilities, the first rate change is proposed to go into effect February 1, 2024 with subsequent rate effective each July 1 beginning in 2024 through 2027. The typical monthly water use of a single family customer is 16 ccf per month. Based on these parameters, the City’s current total combined water, wastewater, and storm drain bill for a typical single family home with a 5/8” meter is $59.75 per month. After the proposed increase, the typical combined residential bill would increase to $77.70 per month on February 1, 2024, an increase of about 30%, see Figure 2.
City of Hanford Page 8 Water, Wastewater, and Stormwater Utility Rate Study 2023
Figure 2: Single Family Residential Monthly Water, Sewer, and Storm Average Bill
City of Hanford Page 9 Water, Wastewater, and Stormwater Utility Rate Study 2023
It should be noted that each customer’s monthly utility bill also includes service charges for other utility services including refuse and street sweeping. The charges for other utility services are not evaluated as part of this study. A survey was conducted comparing the combined monthly utility bill for City of Hanford residents with those of other local cities. Because not all cities charge monthly rates for storm drainage and street sweeping services, only water, wastewater, and refuse charges were included in the comparison, see Figure 3. The City’s current and proposed combined monthly bills fall within the lower to mid-range of those charged by surrounding cities.
Figure 3: Single Family Residential Monthly Water, Sewer, and Refuse Bill Survey
City of Hanford Page 10 Water, Wastewater, and Stormwater Utility Rate Study 2023
SECTION 2: CURRENT RATES AND CUSTOMER BASE
This section provides an overview of the City of Hanford’s current water, wastewater, and storm drainage rates, customer base, water usage statistics, and current rate revenues.
2.1 Current Water Rates
The City bills customers for water service on a monthly basis. The last water rate study was conducted in 2015 which provided a schedule of water rate increases through 2018. A schedule of current monthly water rates that went into effect on July 1, 2018 is provided in Table 4. Current rates vary based on whether each customer is located inside or outside the City limits. There is a 10% surcharge for customers outside the City limits. Prior to the last water rate study, some City customers were unmetered and billed according to a schedule of flat rates for water service. Since then, all customers have been transitioned to metered service. Thus, the City’s existing schedule of water rates for flat rate connections is not evaluated as part of this study. The City’s current water rate structure for metered service connections includes three components: (1) a Connection Charge, (2) a Meter Size Charge, and (3) a Water Consumption Charge.
2.1.1 Connection Charge
All customers are charged a connection charge which is standard across all customer classes and meter sizes. The connection charge is charged independent of water consumption.
2.1.2 Meter Size Charge
All customers are charged a meter size charge based on their meter size which is levied regardless of water consumption and recognizes that even when a customer does not use any water, the City incurs fixed costs associated with maintaining the ability or readiness to serve each connection. Together with the connection charge, the meter size charge makes up the fixed portion of each customer's monthly bill.
2.1.3 Water Consumption Charge
In addition to the fixed charges, all customers pay a water consumption charge per hundred feet (ccf) of water consumption. One ccf is equal to 748 gallons of water. The charges for all customers are the same regardless of customer class.
2.1.4 Private Fire Protection Service
The City also levies a flat charge to three customers that have a separate meter for fire sprinklers. The private fire protection service charges are not evaluated as part of this study.
City of Hanford Page 11 Water, Wastewater, and Stormwater Utility Rate Study 2023
Table 4: Current Monthly Water Rates
City of Hanford
Utility Study
Connection Charge Inside City
Limits
Outside
City Limits
All Service Connections $2.46 $2.71
Meter Size Charge
5/8", 3/4", & 1" meter $12.95 $14.25
1-1/2" & 2" meter $19.42 $21.36
3" & 4" meter $32.37 $35.61
6" meter $51.80 $56.98
8" meter $77.71 $85.48
Water Consumption Charge (per ccf)
Rate per ccf $1.34 $1.47
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons Note: Private fire protection service charges are not included in the table
2.2 Water Customer Base and Current Water Sales Revenues Table 5 includes a summary of the number of water accounts by meter size based on the City’s billing data as well as estimated water usage and service charge revenues for FY 2022/23. The City provides service to over 18,300 accounts of which approximately 450 are outside current City limits. The majority of customers have 5/8”, 3/4”, or 1” meters, representing about 94.0% of total meters.
The City collected approximately $9.3 million in total water rate revenues in FY2022/23. About 38.0% of revenues were collected from fixed charges including the connection charge, meter size charge, and private fire protection charges. The meter charges shown in Table 5 include the Connection Charge that has added on to the Meter Size Charge for each meter size. The remaining 62.0% of revenues were collected from Water Consumption Charges. Total annual water consumption in FY2022/23 was estimated at 4.3 million ccf, a decrease of about 8.0% from the previous two years.
Based on City billing records, the current average single family monthly residential water use is 16 ccf per month. Based on a typical home with a 5/8”, 3/4”, or 1” meter and 16 ccf of water use, the average water bill is currently $36.85 per month.
City of Hanford Page 12 Water, Wastewater, and Stormwater Utility Rate Study 2023
Table 5: Estimated Water Service Sales Revenues from Billing Data, FY 2022/23 City of Hanford
Utility Rate Study
FY 2022/2023 (ESTIMATED)
METER CHARGE
Inside City Accounts Meter Charge No. of Accts Fixed Revenue % of Total 5/8", 3/4", & 1" $15.41 16,861 $3,117,936 33.5%
1-1/2" & 2" $21.88 862 $226,327 2.4%
3" & 4" $34.83 114 $47,647 0.5%
6" $54.26 12 $7,813 0.1%
8" $80.17 3 $2,886 0.0%
Outside City Accounts
5/8", 3/4", & 1" $16.96 428 $87,107 0.9%
1-1/2" & 2" $24.07 20 $5,777 0.1%
3" & 4" $38.32 1 $460 0.0%
6" $59.69 2 $1,433 0.0%
8" $88.19 2 $2,117 0.0%
Private Fire Service
4" $46.62 1 $559 0.0%
6" $69.93 2 $1,678 0.0%
Subtotal Fixed Revenue 18,308 $3,501,740 37.6%
USAGE CHARGE
All Usage Usage Charge Usage (ccf)
Usage Charge
Revenue % of Total
Inside City $1.34 4,195,771 $5,622,334 60.4%
Outside City $1.47 129,074 $189,739 2.0%
Subtotal Consumption Revenue 4,324,846 $5,812,073 62.4%
Total Water Sales Revenue $9,313,813 100.0%
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons
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2.3 Current Wastewater Rates
The City’s last wastewater rate study was conducted in 2009 which determined a schedule of rates through 2011. A schedule of current monthly wastewater rates that went into effect on July 1, 2011 is provided in Table 6. The City’s current rate structure varies based on customer class.
2.3.1 Residential Customers
Residential customers pay a flat monthly charge on a per dwelling unit basis. Single family residential customers pay $17.86 per month, and multi-family customers pay $16.93 per dwelling unit. A triplex is charged for three dwelling units, as an example. The charge per dwelling unit is lower for multi-family customers than single-family customers, reflecting lower average winter water use and estimated sewer flows.
2.3.2 Commercial Customers
Commercial customers pay a volume rate per ccf based on metered monthly water use. There are four subcategories of commercial wastewater customers grouped according to strength of wastewater flow.
Customers with higher strength wastewater flow such as restaurants are billed a higher rate per ccf.
Because sewer flow is not typically metered, water consumption is used as an approximation for sewer flow. It is assumed that any outdoor irrigation water use that does not flow into the sewer is separately metered through an irrigation-only connection that is not billed for sewer service.
2.3.3 Schools
Schools are billed annually based on average daily attendance (ADA) per month during the 9 months when schools are in session.
2.3.4 Septage
The City’s septage hauler customers are billed per thousand gallons according to metered flow.
2.3.5 Industrial Customers
The City’s industrial customers are charged according to actual metered wastewater discharge (flow and pollutant loading) as well as fees for excessive discharge.
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Table 6: Current Wastewater Rates
City of Hanford
Utility Rate Study
RESIDENTIAL
Single family residences $17.86 /month
Duplex, multi-family dwelling per dwelling unit $16.93 /month
NON- RESIDENTIAL
Metered water
(a) Mobile home parks, motels, public buildings, hospitals, nursing homes, churches, fraternal lodges, service stations and automotive centers
$1.54 /ccf [1]
(b) Car washes, laundromats, retail, commercial and
professional establishments $1.44 /ccf
(c) Mixed use commercial centers including food services with single water service $2.15 /ccf
(d) Restaurants, supermarkets, grocery stores, mortuaries $2.88 /ccf Schools $0.51 /student/mo ADA [2]
Septage $26.19 /1000 gallons
INDUSTRIAL
Flow $1,561.56 /million gal.
BOD (Biological Oxygen Demand) $0.17 per lb.
SS (Suspended Solids) $0.17 per lb.
1 - CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 2 - ADA – average daily attendance
2.4 Wastewater Customer Base and Current Revenues
The City’s wastewater utility provides service to over 17,300 single family, multi family, commercial, industrial, and school accounts within the City. The majority of accounts are for single family residential customers, representing about 92.0% of total account holders.
Table 7 includes an estimate of total wastewater rate revenues collected in FY2022/23 based on the City’s billing data as well as the number of billing units in each customer class. It is estimated that the City collected approximately $5.39 million in total wastewater rate revenues in FY2022/23. About 81.0% of revenues were collected from the flat charges billed to single and multi-family residential customers.
Industrial revenues account for over 4.0% of total while commercial revenues represent approximately
13.0%. The remainder of revenues are comprised of school and septage revenues.
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Table 7: Estimated Wastewater Service Charge Revenues from Billing Data, FY 2022/23 City of Hanford
Utility Rate Study
FY 2022/2023 (ESTIMATED)
FIXED CHARGES
Residential Customers
Monthly Fixed
Charge No. of Units
Estimated
Fixed
Revenue % of Total
Single Family Residential $17.86 15,872 $3,401,687 64.3% Multi-Family Residential per unit $16.93 4,345 $882,730 16.7% Subtotal Residential $4,284,417 81.0%
VOLUME RATES
Industrial Customers
Usage Charge
($/million gal
or $/lb.) Units
Estimated
Revenue % of Total
Flow (million gallons) $1,561.0 145.16 $226,595 4.3%
BOD (lbs) $0.173 33,269 $5,761 0.1%
SS (lbs) $0.167 27,119 $4,527 0.1%
Subtotal Industrial $236,883 4.5%
Commercial Customers
Usage Charge
($/ccf) Billed Flow
Estimated
Revenue % of Total
Group A: Domestic $1.54 129,553 $199,512 3.8%
Group B: Low Strength $1.44 168,658 $242,868 4.6%
Group C: Medium Strength $2.15 12,939 $27,819 0.5%
Group D: High Strength $2.89 79,588 $230,009 4.3%
Subtotal Commercial 390,738 $700,207 13.2%
Schools
Charge per
student (ADA)
# of
students
Estimated
Revenue % of Total
$0.51 $48,539 0.9%
Subtotal Schools $48,539 0.9%
Septage
Usage Charge
($/1000 gal)
Billed Flow
(1,000 gal)
Estimated
Revenue % of Total
$26.19 765 $20,038 0.4%
Subtotal Septage $20,038 0.4%
TOTAL WASTEWATER SERVICE REVENUES $5,290,084 100.0%
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons
City of Hanford Page 16 Water, Wastewater, and Stormwater Utility Rate Study 2023
2.5 Current Storm Drainage Rates and Revenues
Of the existing wastewater system charges adopted in the City’s Resolution No. 09-77-R, 78.0% of the service charges for each customer are allocated to the wastewater system as shown in Table 6, and the remaining 22.0% are allocated to the storm drain system. Thus, the rate structure for the storm drain system is the same as the rate structure for the wastewater system. A schedule of current monthly storm drain rates that went into effect on July 1, 2011 is provided in Table 8. Residential customers are billed a flat charge per dwelling unit, commercial customers are billed a volume rate per ccf of metered water usage, schools are billed per student, septage users are billed per thousand gallons, and industrial customers are billed according to metered wastewater discharge.
Annual fee revenues collected in FY2022/23 were estimated at $1.45 million. About 65.0% of revenues were collected from single family residential customers. Multi-family residential customers generated
16.2% of revenues, businesses generated 10.5%, industrial customers generated 5.9%, and the remainder were collected from public agencies and schools.
Table 8: Current Storm Drainage Rates
City of Hanford
Utility Rate Study
RESIDENTIAL
Single family residences $5.04 /month
Duplex, multi-family dwelling per dwelling unit $4.77 /month
NON- RESIDENTIAL
Metered water
(a) Mobile home parks, motels, public buildings, hospitals, nursing homes, churches, fraternal lodges, service stations and automotive centers
$0.43 /ccf [1]
(b) Car washes, laundromats, retail, commercial and
professional establishments $0.40 /ccf
(c) Mixed use commercial centers including food services with single water service $0.61 /ccf
(d) Restaurants, supermarkets, grocery stores, mortuaries $0.81 /ccf Schools $0.15 /student/mo ADA [2]
Septage $7.39 /1000 gallons
INDUSTRIAL
Flow $440.44 /million gal.
BOD (Biological Oxygen Demand) $0.0488 per lb.
SS (Suspended Solids) $0.0471 per lb.
1 - CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons 2 - ADA = average daily attendance
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SECTION 3: WATER REVENUE REQUIREMENT
Proposition 218 requires that utility rates be based on the reasonable cost of providing service to customers. The cost of service includes annual operating expenses, capital improvement projects, and the accumulation of appropriate reserves. This section summarizes the water utility’s revenues and expenses to determine the total cost of service to be recovered via rates. The cost of service is expressed in a cash flow table that illustrates revenue increases needed to keep up with expenses and maintain the financial health of the enterprise.
3.1 Water System Overview
The City is responsible for providing safe, clean water through the operation of its water system consisting of over 220 miles of water mains, 12 water supply wells, and 3.5 million gallons of water storage. The City’s sole water source is groundwater from within the San Joaquin Valley Groundwater Basin which is obtained from wells and chlorinated before distribution. One well also includes treatment facilities for the removal of arsenic.
There are over 18,000 active water accounts including City residents and a small number of residents in surrounding areas. On average over the past 3 years, the City has consumed between 4.5 million and 5 million ccf of water each year. Single family residential consumption comprises more than half of the City’s total consumption at approximately 66.0% with the remaining 33.0% of use by multi-family residential, commercial, industrial, public agency, and school customers. Based on City billing records, the current average monthly single family residential water use is 16 ccf per month.
3.2 Water Reserves
The accumulation and maintenance of reasonable reserves is one factor to consider when determining the cost of service. Adequate fund reserves protect the City when faced with unforeseen financial challenges such as emergency expenses or revenue deficits. Fund reserves allow the City to maintain its financial health and positive credit ratings, especially during emergencies. Moreover, funding can be drawn from reserves to supplement rate revenues lost during drought conditions or other unexpected situations. The City can also choose to use reserves to smooth cash flows and mitigate impacts to ratepayers.
The City maintains two water reserve funds – 1) an operating fund reserve and 2) a capital reserve fund reserve. As of the beginning of FY 2023/24, the water utility had operations fund reserves of approximately $9.98 million and capital and reserve fund reserves of approximately $10.58 million. Total reserves are strong. The recommended reserve target is 50 percent of annual operating costs plus one year’s total debt service payment.
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3.3 Water Capital Improvement Plan
Table 9 provides the City’s capital improvement plan (CIP) by year for the rate study period, totaling $43.7 million. Projects funded by impact fees or other non-rate sources are not included. Major projects include the replacement of water meters and aged water mains throughout the City.
Table 9: Water Capital Improvement Plan (rate funded)
City of Hanford
Utility Rate Study
Project Title FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 5-Year Total Water Sys Security Upgrades $605,740 - - - - $605,740 Utility Customer Payment Kiosks (2) $27,000 $14,000 $14,000 $14,000 $14,000 $83,000 Industrial Park Water Storage - $3,879,800 - - - $3,879,800 Tank 4 Chlorination $66,070 - - - - $66,070
Repr Well 45 & 49 $86,060 - - - - $86,060
Lacey Blvd Widen Magna Carta to 13th - - - $500,000 - $500,000 2910 Well Pump Rehab 42 & 38 $120,000 $120,000 - - - $240,000 2910 Spare Motor 250 - - $60,000 - - $60,000
Water Distrib Main Ext Program - $480,000 - - - $480,000 Water Main Repl Program $700,000 - $700,000 - $700,000 $2,100,000 New Water Supply Well $900,000 - $900,000 - $900,000 $2,700,000 2910 Meter Replacement $5,000,000 $5,000,000 $5,000,000 - - $15,000,000 Unsch Main Exten/Repl-Water $50,000 $50,000 $50,000 $50,000 $50,000 $250,000 2081 Fire Hydrants $28,000 - - - - $28,000
1750 Pw Enclosed Warehouse - - $200,000 - - $200,000 Lacey Widen/Recon/10th-Sierra $366,020 $584,640 $223,870 - - $1,174,530 Meter Replacement Program $857,830 $120,000 $120,000 $120,000 $120,000 $1,337,830 Automated Meter Zenner Eq Repair $638,180 - - - - $638,180 Amr Replacement Program $400,000 $400,000 $400,000 $400,000 $400,000 $2,000,000 Annual Repairs & Replacement - $500,000 $500,000 $500,000 $500,000 $2,000,000 Well 51 and Well 52 - $4,240,000 - - - $4,240,000
Well and Tank at Heroes Park - - - - $6,000,000 $6,000,000 Total Water CIP $9,844,900 $15,388,440 $8,167,870 $1,584,000 $8,684,000 $43,669,210
3.4 Water Cash Flow Projection
The water fund cash flow for the five-year period beginning in FY 2023/24 through FY 2027/28 is provided in Table 10. The cash flow is based on the City’s FY 2023/24 and 2024/25 Budget and includes revenue increases such that the City covers operating and debt service costs, funds all proposed capital improvement projects, and maintains adequate reserves. Revenue increases over the course of the five- year period are proposed to be 35.0% in the first year followed by 15.0%, 10.0%, 5.0%, and 5.0%. It should be noted that this level of increase is applied to the City’s total water rate revenues and does not necessarily reflect the level of increase for individual customers. Each customer’s bill varies depending
City of Hanford Page 19 Water, Wastewater, and Stormwater Utility Rate Study 2023
on meter size and water usage. The first rate increase is proposed to go into effect February 1, 2024, followed by subsequent increases each July 1 beginning in 2024 through 2027.
3.4.1 Water Revenues
As shown in Table 5, current water rates are estimated to generate $9.3 million in revenues. For FY 2023/24, rate revenues are projected at $10.4 million, assuming the City will collect rates at the current revenues for 7 months and rates with proposed revenue increases for 5 months. Rate revenues are the main revenue source for the water utility, comprising about 97.0% of total water revenues. Other revenue sources include penalty fees, job orders, interest income, and miscellaneous income. These other sources generate about $299,000 annually, which is projected to remain constant over the next five years.
3.4.2 Water Expenses
The cash flow uses the City’s FY 2023/24 and FY 2024/25 Budget as the basis for projected expenses.
Most operating expenses are projected to increase 3.0% annually beginning in FY 2025/26, except for Salaries & Benefits which are escalated by 7.0% annually beginning in FY 2025/26 per City direction. The water fund’s share of payments for the principle for the Pension Obligation Bond (POB) are included as a new expense. New fees payable to the local Groundwater Sustainability Agency (GSA) are estimated at $100,000 annually for administration plus an additional $500,000 per year for pumping fees beginning in FY 2024/25. Annual depreciation is not included as a cash expense. The City’s capital improvement plan includes funding for the repair and replacement of infrastructure to keep up with wear and tear on the City’s facilities.
3.4.3 Debt Service and Debt Service Coverage
A chief covenant for the City to secure loans, grants, or revenue bonds/Certificates of Participation (COPs) is to maintain a specific debt service coverage ratio. A debt service coverage ratio is a financial measure of an agency’s ability to repay outstanding debt. For the water fund, the debt service coverage ratio means that annual water net revenues (gross revenues less operating and maintenance expenses) must be at least 1.2 times the combined annual debt service payments on all parity obligations. Failure to meet the debt service coverage ratio on an annual basis is considered to be technical default, thereby making the revenue bonds/COPs callable or payable upon demand. Thus, rates and fees must be set to meet this legal requirement.
The water utility currently has one outstanding debt obligation that counts toward its debt service coverage requirement – Water Revenue Refunding Bonds, Series 2013. In 2013, the City issued $12.725 million in bonds bearing interest of 2.0% to 5.0% payable semi-annually beginning in October 2013. The Bonds were issued to refinance the City’s previously issued $8.925 million CSCDA Water and Wastewater Revenue Bonds dated December 9, 2003 and the $8.15 million Installment Sale Agreement – Water System dated December 20, 2007. Total annual debt service is about $1.1 million and will be
City of Hanford Page 20 Water, Wastewater, and Stormwater Utility Rate Study 2023
paid off in October 2028. The rates proposed in this study are expected to generate adequate revenues to meet the City’s current and future coverage requirements.
3.4.4 Five-Year Summary
Figure 4 graphically shows the water cash flow projection for the five-year rate study period including both operating and capital expenses. In the first few years, expenses will exceed revenues. The City will spend down some of its existing reserves to fund capital projects, thereby mitigating the level of rate increases needed for customers. At the end of the five-year period, the City’s revenues are projected to be in-line with total expenses.
Figure 4: Water Cash Flows
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Table 10: Water Cash Flow Projection
City of Hanford
Utility Rate Study Years 1 -5: Proposition 218 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Rate Revenue Increase 35.0% 15.0% 10.0% 5.0% 5.0%
Rate Increase Effective Feb 1, 2024 Jul 1, 2024 Jul 1, 2025 Jul 1, 2026 Jul 1, 2027 BEGINNING FUND BALANCE [1] $9,975,000 $4,324,000 $2,038,000 $3,416,000 $5,304,000 REVENUES Rate Revenues [2] 10,398,000 14,457,000 15,903,000 16,698,000 17,533,000 Penalties 40,000 40,000 40,000 40,000 40,000
Service Orders/Job Orders 90,000 90,000 90,000 90,000 90,000 Interest Income 39,000 39,000 39,000 39,000 39,000
Miscellaneous Income 130,000 130,000 130,000 130,000 130,000 Total Revenue 10,697,000 14,756,000 16,202,000 16,997,000 17,832,000 EXPENSES Operating Expenses
Salaries and Benefits 1,782,000 1,996,000 2,136,000 2,286,000 2,446,000 Supplies and Equipment 1,363,000 1,353,000 1,394,000 1,436,000 1,479,000 Outside Services 235,000 231,000 238,000 245,000 252,000 City Services Allocation 1,065,000 1,065,000 1,097,000 1,130,000 1,164,000 GSA Fees 100,000 600,000 600,000 600,000 600,000
POB Principal 230,000 225,000 226,000 225,000 234,000 Chemicals 300,000 300,000 309,000 318,000 328,000
Utilities 1,645,000 1,645,000 1,694,000 1,745,000 1,797,000 Subtotal O&M 6,720,000 7,415,000 7,694,000 7,985,000 8,300,000 Net Operating Revenue 3,977,000 7,341,000 8,508,000 9,012,000 9,532,000 Debt Service Water Rev Refunding Bonds, Series 2013 1,128,000 1,127,000 1,130,000 1,124,000 1,134,000 Transfers Out (#570250) 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 Addt'l Transfer to Capital Fund 6,000,000 6,000,000 3,500,000 3,500,000 3,500,000 Transfers to Capital Fund 8,500,000 8,500,000 6,000,000 6,000,000 6,000,000 Total Operations Fund Net Revenues (5,651,000) (2,286,000) 1,378,000 1,888,000 2,398,000 OPERATIONS FUND ENDING BALANCE 4,324,000 2,038,000 3,416,000 5,304,000 7,702,000 Operations Fund Reserve Target [3] 4,488,000 4,835,000 4,977,000 5,117,000 5,284,000 Operating Reserve Target Met? no no no yes yes Debt Service Coverage (Target = 1.20x) [4] 3.53 6.51 7.53 8.02 8.41 CAPITAL & RESERVE BEG. BALANCE [5] 10,582,000 9,237,000 2,349,000 181,000 4,597,000 Revenues Transfer from Operations Fund (#570250) 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 Transfer from Operations Fund 6,000,000 6,000,000 3,500,000 3,500,000 3,500,000 Subtotal Capital Revenues 8,500,000 8,500,000 6,000,000 6,000,000 6,000,000 Capital Plan Expenses 9,845,000 15,388,000 8,168,000 1,584,000 8,684,000 Capital Fund Net Revenues (1,345,000) (6,888,000) (2,168,000) 4,416,000 (2,684,000)
CAPITAL & RESERVE ENDING BALANCE 9,237,000 2,349,000 181,000 4,597,000 1,913,000 1 - Estimated Water Operations Fund cash fund balance from City staff 2 – FY 2023/24 revenues are estimated based on 7 months at current rate revenues and 5 months with proposed rate increases 3 - Recommended targets is 6 months O&M Expenses plus annual debt service cost 4 - Net Operating Revenue divided by Total Debt Service 5 - Estimated Water Capital & Reserve Fund cash fund balance from City staff
City of Hanford Page 22 Water, Wastewater, and Stormwater Utility Rate Study 2023
SECTION 4: WATER COST ALLOCATION AND RATE DESIGN
4.1 Water Cost Allocation
The water revenue requirement detailed in the previous section determines the total cost of providing service to be recovered from water rates, and in this section that revenue requirement is assigned to fixed and consumption charges to fairly recover costs from customers based on how they use the water system. Proposition 218 requires that agencies providing “property-related services” (including water utility service) set rates and charges that are based on the cost of providing those services and are proportional to how customers use the system.
4.1.1 Overview of Water Cost of Service Methodology
The purpose of the cost allocation is to classify costs and to determine the amount of revenue that will be recovered from fixed charges and from consumption charges. The American Water Works Association (AWWA) recommends methods to classify costs among various customers. Using the Base- Extra Capacity Method as recommended by the AWWA, water operating expenses are allocated to the following categories: (a) Base, (b) Extra, (c) Meters & Services, and (d) Customer Service. The Base and Extra categories are intended to recover variable (consumption) costs, while the Customer Service and Meters & Services categories are intended to recover fixed expenses that are incurred regardless of water used.
Base: Base costs include the expenses related to providing water under average, “base” demand conditions.
Extra: The extra category includes costs related to providing water above the system average demand (ie. related to peak, “extra” usage).
Meters & Services: These include costs related to maintaining and replacing water meters and operating costs related to providing service at the maximum demand of each meter.
Customer Service: This category contains costs associated with serving customers, such as billing and answering customer inquiries.
4.1.2 Cost Allocation
The cost allocation for the water utility is provided below in Table 11. The FY 2023/24 Budget is used as the test year for the cost allocation. Costs are allocated according to how they are incurred by the City.
Based on the proposed allocation, roughly 33.0% of costs will be recovered from the Fixed Charges while the remaining 67.0% will be recovered from Consumption Charges.
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Table 11: Water Cost Allocation City of Hanford Utility Rate Study Budgeted Expenses Budget FY
2023/24
Consumption
Charge Fixed Charge
Base & Extra Meters Customer Service
Operating Expenses
Salaries and Benefits $1,782,000 66.67% 16.67% 16.67%
Supplies and Equipment $1,363,000 60.00% 20.00% 20.00%
Outside Services $235,000 60.00% 20.00% 20.00%
GSA Fees $100,000 0.00% 50.00% 50.00%
POB Principal $230,000 66.67% 16.67% 16.67%
Chemicals $300,000 100.00% 0.00% 0.00%
Utilities $1,645,000 100.00% 0.00% 0.00%
Subtotal $5,655,000 $4,245,133 $704,933 $704,933
75.07% 12.47% 12.47%
City Services Allocation $1,065,000 75.07% 12.47% 12.47% Total Operating $6,720,000 $5,044,615 $837,693 $837,693
Non-Operating Expenses
Debt Service (5-year avg) $1,128,600 100.00% 0.00% 0.00% Water CIP Projects (5-year avg) [1] $8,733,800 56.36% 43.45% 0.19% Subtotal Non-Operating $9,862,400 $6,050,616 $3,795,184 $16,600
Total Expenses $16,582,400 $11,095,231 $4,632,876 $854,293 Proposed Cost Allocation % 66.91% 27.94% 5.15%
1 - Based on CIP projects over the next five years
4.1.3 Annual Revenue Requirement Allocation
To determine the total revenues that must be collected each year from fixed and consumption charges, the cost allocation percentages from Table 11 are applied to the total water rate revenue requirements from the cash flow projection (Table 10). The fixed charge revenue requirement is based on the Meters & Services and Customer Service categories from the cost allocation. The consumption charge revenue requirement is based on the Base and Extra categories.
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Table 12: Annual Revenue Requirement Allocation
City of Hanford
Utility Rate Study Cost
Allocation
%
PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Total Revenue
Requirement [1] $12,571,000 $14,457,000 $15,903,000 $16,698,000 $17,533,000
FIXED CHARGES
Meters & Services 27.9% $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Customer Service Charge 5.2% $647,633 $744,796 $819,291 $860,248 $903,266 Total Fixed Charges 33.1% $4,159,784 $4,783,867 $5,262,353 $5,525,421 $5,801,726
CONSUMPTION CHARGES
Total Consumption Charges 66.9% $8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274
TOTAL 100.0% $12,571,000 $14,457,000 $15,903,000 $16,698,000 $17,533,000
1 – FY 2023/24 Revenue Requirement is if February 1 rates were to be in effect for 12 months
4.2 Billing Units
4.2.1 Meter Equivalents
The most common method to levy fixed charges is by meter size. AWWA guidelines recommend using meter equivalents to assign demand-related and service related costs to larger meter sizes. The ratio at which the meter charge increases is typically a function of either meter investment (estimated cost) or the meter’s safe operating capacity. The AWWA M1 Manual 7th Edition page 77 states “billing ratios are used to recognize that billing, metering, and collection costs for larger services may be greater than for smaller meter-size services. This may be due to difficulty in accessing the meter facility, replacement of meters, multiple dial meters, more customer service time associated with dealing with larger meter customers, and other factors.” These costs are reflected in the portion of Salaries and Benefits and Supplies and Equipment line items allocated to Customer Service and Meters in Table 11.
Moreover, larger meters have the ability to place a greater demand on the water system and are therefore charged based on that potential demand (or standby capacity). Water system components such as pumps, tanks, and pipelines are engineered and designed to meet maximum hour demand plus fire flow. The City incurs costs to maintain and operate these facilities at maximum capacity 24 hours a day, 365 days per year. For example, a customer that has a 6” meter has 20 times the capacity equivalency (flow rate) of a customer with a 5/8” or 1” meter. (A 6” meter has a safe operating capacity of 1,000 gallons per minute (gpm) compared to a 5/8” or 1” meter which has a safe operating capacity
City of Hanford Page 25 Water, Wastewater, and Stormwater Utility Rate Study 2023
of 50 gpm). If all customers had 5/8” meters, the City would incur lower operating and capital costs as facilities would be smaller sized and more easily replaced and maintained. The AWWA M1 Manual 7th Edition page 152 states "this analysis considers that there is a minimum system in place to meet minimum service requirements regardless of use. The minimum needs are defined by determining the minimum size a system would be designed to meet minimum or average service needs (e.g., 4-in. service) not considering sizing for peak-day capacity needs or fire protection. The percentage of the distribution system related to meeting the minimum system needs would be applied to distribution-related costs and would be collected in the fixed charges. Incremental system sizing related to sizing the system to meet peak-day needs and fire flow requirements may also be considered for inclusion in the fixed charges.” These costs are staffing, maintenance, and capital expenses from Table 11 associated with providing capacity for the maximum flow rate of each meter.
Table 13 shows the existing number of meters by meter size and calculates the number of meter equivalents based on the AWWA recommended meter ratios. The base meter size for the City is the 5/8”, 3/4”, or 1” meter, representing over 94.0% of all meters served. The recalculation of meter equivalents for larger meter sizes will amend the fixed charges so that each meter size will be charged based on their proportional impact on the system.
Table 13: Number of Meter Equivalents (Total Inside & Outside City Accounts) City of Hanford
Utility Rate Study
Meter Size
No. of
Meters
Flow Rate
(gpm)
Meter
Ratio
No. of Meter
Equivalents
5/8", 3/4", & 1" 17,289 50 1.00 17,289
1-1/2" & 2" 882 100 2.00 1,764
3" & 4" 115 320 6.40 736
6" 14 1,000 20.00 280
8" 5 1,600 32.00 160
TOTAL 18,305 20,229
Flow rates taken from AWWA M1 Manual 7th Edition page 386
4.2.2 Projected Growth and Use
Table 14 shows an estimate of total water meters, water meter equivalents, and water use for the next five years. Customer growth is projected at 0.9% each year beginning in FY 2024/25 based on the projected annual growth rate from the City’s most recent Urban Water Management Plan by the Akel Engineering Group. Estimated current water use is based on billing data from the past two years less an
8.0% conservation factor to account for actual decreased water rate revenue in FY 2022/23.
Consumption is conservatively estimated to remain level through the first two years of the study period to account for conservation as customers adjust to the increased water rates. Beginning in FY 2025/26, water consumption is estimated to increase by 0.9% each year concurrently with growth in the customer base.
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Table 14: Projected Customer Growth & Water Consumption City of Hanford
Utility Rate Study CURRENT PROJECTED - RATE STUDY PERIOD 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
NUMBER OF METERS
Growth Increase % [1] 0.00% 0.90% 0.90% 0.90% 0.90%
Total Water Meters 18,305 18,305 18,470 18,636 18,804 18,973
Total Meter Equivalents 20,229 20,229 20,411 20,595 20,780 20,967
WATER CONSUMPTION
Annual Increase % [2] 0.00% 0.00% 0.90% 0.90% 0.90%
Total Consumption [3] 4,324,846 4,324,846 4,324,846 4,363,769 4,403,043 4,442,671
1 - Table 3-2, Urban Water Management Plan by Akel Engineering Group projects an annual growth rate of 0.9% 2 - Projected water use for FY2024 and FY2025 reflect no growth in use as customers adjust to the new rate increases
3 - Note: Projected 2023 consumption is based on the average of FY 2020/21 and FY 2021/22 less 8% to account for observed conservation during FY 2022/23
4.3 Water Rate Design
To comply with Proposition 218, the following modifications to the existing water rate structure are proposed:
Inside vs. Outside City Rates
Eliminate the 10% surcharge for customers outside the City limits.
Fixed Meter Charge
Use the AWWA meter capacity ratios to calculate rates for the larger meter sizes. The re- alignment will amend the fixed charges so that each meter size will be charged based on their proportional impact on the system. This is in-line with industry standard practice and is the policy of most other local utility providers.
Drought Rates
Adopt a schedule of drought consumption charges whereby the rate per unit of water (ccf) for all customers will temporarily increase should the City declare a water shortage emergency. The drought rates are in alignment with the City’s existing Water Shortage Contingency Plan.
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4.4 Water Rate Derivation
Following the allocation of costs, the next step is to derive the total cost responsibility for each customer class by developing unit costs of service for each cost function and then assigning those costs to the customer classes based on the respective service requirements of each.
4.4.1 Fixed Meter Charge Calculation
Table 15 shows the rate derivation for the proposed Fixed Charge by meter size based on the AWWA meter equivalents from Table 13 and the total revenue requirements from Table 12. The customer service portion of the Fixed Charge is proposed to be the same for each customer regardless of meter size, whereas the meter equivalent portion of the fixed charge is proposed to be based on meter size.
The total Meters & Services revenue requirement is divided by the total number of meter equivalents.
The Customer Service revenue requirement is divided by the total number of accounts.
For 2023/24, the proposed meter equivalent charge of $14.47 is multiplied by the corresponding meter equivalent ratio to calculate a charge for each meter size. The customer service charge of $2.95 is then added to the meter equivalent charge for each meter size to calculate the total proposed fixed charge.
The proposed 2023/24 charge for a 5/8”, 3/4”, or 1” meter is $17.42.
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Table 15: Water Fixed Charge Derivation
City of Hanford
Utility Rate Study
PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
REVENUE REQUIREMENT
Meters & Services $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Customer Service Charge $647,633 $744,796 $819,291 $860,248 $903,266 Total Fixed Charge Rev. Requirement $4,159,784 $4,783,867 $5,262,353 $5,525,421 $5,801,726
METER EQUIVALENT CHARGE
Total Meter Equivalent Charge Revenue
Requirement 7.8% $3,512,151 $4,039,071 $4,443,062 $4,665,173 $4,898,460 Total Number of Meter Equivalents 20,229 20,411 20,595 20,780 20,967 Total Meter Equivalent Charge $14.47 $16.49 $17.98 $18.71 $19.47
Meter Equivalent Charge by Meter Size
Meter Size Ratio
5/8", 3/4", & 1" 1.00 $14.47 $16.49 $17.98 $18.71 $19.47 1-1/2" & 2" 2.00 $28.94 $32.98 $35.96 $37.42 $38.94 3" & 4" 6.40 $92.61 $105.54 $115.07 $119.74 $124.61 6" 20.00 $289.40 $329.80 $359.60 $374.20 $389.40
8" 32.00 $463.04 $527.68 $575.36 $598.72 $623.04
CUSTOMER SERVICE CHARGE
Total Customer Service Charge Revenue
Requirement 7.8% $647,633 $744,796 $819,291 $860,248 $903,266 Total Number of Meters 18,305 18,470 18,636 18,804 18,973 Total Customer Service Charge per
Account
$2.95 $3.36 $3.66 $3.81 $3.97
TOTAL MONTHLY FIXED CHARGE [1]
Meter Size
5/8", 3/4", & 1" $17.42 $19.85 $21.64 $22.52 $23.44 1-1/2" & 2" $31.89 $36.34 $39.62 $41.23 $42.91
3" & 4" $95.56 $108.90 $118.73 $123.55 $128.58
6" $292.35 $333.16 $363.26 $378.01 $393.37
8" $465.99 $531.04 $579.02 $602.53 $627.01
1 - Total Monthly Fixed Charge is the sum of the "Meter Equivalent Charge" by meter size plus the "Total Customer Service Charge per Account"
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4.4.2 Consumption Charge Derivation
Table 16 calculates the Consumption Charge for all customers based on the total revenue requirement from Table 12 and projected annual water consumption from Table 14. The proposed Consumption Charge is a single uniform tier in which all customer classes are charged the same rate for each unit of water consumption. The proposed FY 2023/24 Consumption Charge is $1.94 per ccf.
Table 16: Consumption Charge Rate Derivation
City of Hanford
Utility Rate Study
PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
REVENUE REQUIREMENT
Total Consumption Charge Revenue
Requirement
$8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274
CONSUMPTION CHARGE DERIVATION
Revenue Requirement $8,411,216 $9,673,133 $10,640,647 $11,172,579 $11,731,274 Total Consumption (ccf) 4,324,846 4,324,846 4,363,769 4,403,043 4,442,671 Rate per ccf $1.94 $2.24 $2.44 $2.54 $2.64
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons
4.4.3 Drought Rate Derivation
It is recommended that the City implement a series of drought consumption charges which can be implemented during a water shortage emergency, allowing for financial stability during periods of reduced water sales. Drought rates are designed to cover costs at decreased levels of consumption. The City recognizes that ratepayers are already doing their part to conserve. Therefore, applying the drought surcharge to only the consumption charge component gives customers the increased ability to control a portion of their water bills. The proposed drought rates would be charged on a temporary basis and would be phased out when the City determined that water supply conditions had returned to normal and drought-related costs and revenue reductions had been recovered.
During times of water shortages, a water utility has two core objectives: 1) to reduce the amount of water customers consume, and 2) to cover the cost of operations. The two competing objectives work against each other because as less water is sold, it becomes more difficult to maintain adequate revenue to cover an agency’s costs. It should be noted that under drought conditions, certain expenses such as electricity, supplies, and equipment will decrease relative to the decrease in water use. However, other costs to operate the water system such as staffing and maintaining long-term supply remain the same.
The reduction in cost during drought conditions is reflected in the revenue requirements shown in Table
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17. The levels of water cutback for the proposed drought rates in Table 17 are designed to be in alignment with the City’s existing Water Shortage Contingency Plan and represent potential water shortage scenarios. Estimated base and extra expenses under each cutback scenario are divided by total water usage to calculate the drought consumption charges.
Table 17: Consumption Charge Rate Derivation - Drought Rates City of Hanford Utility Rate Study
PROJECTED - RATE STUDY PERIOD
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
CONSUMPTION CHARGE DERIVATION - 10% Cutback
Revenue Requirement $8,191,081 $9,419,971 $10,362,164 $10,880,174 $11,424,248 Total Consumption (ccf) 3,892,361 3,892,361 3,927,392 3,962,739 3,998,404 Rate per ccf $2.10 $2.42 $2.64 $2.75 $2.86
CONSUMPTION CHARGE DERIVATION - 20% Cutback
Revenue Requirement $7,970,946 $9,166,810 $10,083,681 $10,587,770 $11,117,222 Total Consumption (ccf) 3,459,877 3,459,877 3,491,016 3,522,435 3,554,137 Rate per ccf $2.30 $2.65 $2.89 $3.01 $3.13
CONSUMPTION CHARGE DERIVATION - 35% Cutback
Revenue Requirement $7,640,743 $8,787,068 $9,665,957 $10,149,164 $10,656,682 Total Consumption (ccf) 2,811,150 2,811,150 2,836,450 2,861,978 2,887,736 Rate per ccf $2.72 $3.13 $3.41 $3.55 $3.69
CONSUMPTION CHARGE DERIVATION - 50% Cutback
Revenue Requirement $7,310,541 $8,407,326 $9,248,233 $9,710,557 $10,196,143 Total Consumption (ccf) 2,162,423 2,162,423 2,181,885 2,201,522 2,221,335 Rate per ccf $3.38 $3.89 $4.24 $4.41 $4.59
CCF – hundred cubic feet; one hundred cubic feet equals 748 gallons
4.4.4 Proposed Water Rates
Table 18 summarizes the proposed monthly water rates for the next five years including meter charges, consumption charges, and drought consumption charges. All accounts, including residential, commercial, and industrial customers, will be charged according to the proposed rate schedule shown.
The first rate change is proposed to take effect on February 1, 2024, with subsequent rate increases effective each July 1 beginning in 2024 through 2027. For FY 2023/24, the proposed 35.0% revenue adjustment in the cash flow (Table 10) does not directly correlate to a 35.0% increase in rates due to the cost of service reallocation and the updated rate structure. The percentage increases for each rate category are shown below the table.
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Table 18: Proposed Monthly Water Rates City of Hanford Utility Rate Study
Current [1]
PROPOSED
Fiscal Year FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 Effective Date July 1, 2018 Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027
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%
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4.5 Water Bill Impacts
Bill impacts to customers for the first year will vary based on meter size and actual consumption.
Moreover, water consumption, particularly for single family customers, typically varies due to seasonal variations in weather and/or other factors. Hence, a single customer could face a range of impacts throughout the year. Table 19 includes a sample of bill impacts at different levels of water use for single family residential customers with a 5/8”, 3/4”, or 1” meter.
Table 19: Sample Monthly Residential Water Bill Impacts City of Hanford
Utility Rate Study
RESIDENTIAL BILL IMPACTS - 5/8", 3/4", & 1" METER
Monthly Current Proposed
Use (ccf) Bill Feb 1, 2024 July 1, 2024 July 1, 2025 July 1, 2026 July 1, 2027
6 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 6 $8.04 $11.64 $13.44 $14.64 $15.24 $15.84 Total Monthly Water Bill $23.45 $29.06 $33.29 $36.28 $37.76 $39.28 $ Change $5.61 $4.23 $2.99 $1.48 $1.52
% Change 23.9% 14.6% 9.0% 4.1% 4.0%
10 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 10 $13.40 $19.40 $22.40 $24.40 $25.40 $26.40 Total Monthly Water Bill $28.81 $36.82 $42.25 $46.04 $47.92 $49.84 $ Change $8.01 $5.43 $3.79 $1.88 $1.92
% Change 27.8% 14.7% 9.0% 4.1% 4.0%
16 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 16 $21.44 $31.04 $35.84 $39.04 $40.64 $42.24 Total Monthly Water Bill $36.85 $48.46 $55.69 $60.68 $63.16 $65.68 $ Change $11.61 $7.23 $4.99 $2.48 $2.52
% Change 31.5% 14.9% 9.0% 4.1% 4.0%
25 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 25 $33.50 $48.50 $56.00 $61.00 $63.50 $66.00 Total Monthly Water Bill $48.91 $65.92 $75.85 $82.64 $86.02 $89.44 $ Change $17.01 $9.93 $6.79 $3.38 $3.42
% Change 34.8% 15.1% 9.0% 4.1% 4.0%
40 ccf
Fixed Meter Charge - 5/8", 3/4", & 1" $15.41 $17.42 $19.85 $21.64 $22.52 $23.44 Consumption Charge 40 $53.60 $77.60 $89.60 $97.60 $101.60 $105.60 Total Monthly Water Bill $69.01 $95.02 $109.45 $119.24 $124.12 $129.04 $ Change $26.01 $14.43 $9.79 $4.88 $4.92
% Change 37.7% 15.2% 8.9% 4.1% 4.0%
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
City of Hanford Page 35 Water, Wastewater, and Stormwater Utility Rate Study 2023
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
City of Hanford Page 38 Water, Wastewater, and Stormwater Utility Rate Study 2023
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.
City of Hanford Page 42 Water, Wastewater, and Stormwater Utility Rate Study 2023
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
City of Hanford Page 43 Water, Wastewater, and Stormwater Utility Rate Study 2023
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
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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.
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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
15.B.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: PUBLIC HEARING
SUBJECT:
Public Hearing to receive comments on the proposed Zone Text Amendment No. 2024-01, a request to amend Title 17, Section 17.56.230 of the Hanford Municipal Code in order to comply with free speech requirements and establish a new application process for murals and Introduction of Ordinance 24-01, approving the ZTA.
RECOMMENDATION:
Recommendation: That the City Council, by motion, Introduce Ordinance 24-01, approving Zone Text Amendment No. 2024-01.
BACKGROUND:
The Hanford City Council directed staff to review the current mural ordinance and evaluate whether changes were necessary to comply with free speech requirements and to create a new application process. Staff review of the ordinance revealed that several design guidelines in HMC 17.56 related to murals are not enforceable, due to content-based restrictions. Except for obscene content and commercial advertisements, the City is not able to deny a mural permit based on the content of the mural.
Zoning Text Amendment 2024-01 would remove the content-based requirements from the City's mural ordinance and replace it with criteria that outlines the application process, allows the City to adopt a mural policy, and prohibits murals that are obscene or classified as commercial advertisements.
Due to the need to overhaul the entire ordinance, staff recommends deletion of the existing ordinance and replacement with the following text:
17.56.230 Wall mural placement and design criteria.
The Community Development Director is authorized to implement and administer a city mural policy and application process for private structures, as adopted by the city council by resolution, which establishes requirements for murals on private structures.
A. Allowed Murals. An application which meets all of the following criteria, and which is not otherwise prohibited by this Chapter, will be allowed:
1. Submission of a complete mural application;
2. Compliance with all the requirements of the adopted mural policy and all requirements of this Code;
3. Located within the City’s MX-D zone;
4. Payment of any fees required for a mural permit.
B. Prohibited Murals. The following murals are prohibited:
1. Murals containing statements, words, symbols, or characters of an obscene nature.
2. Murals that contain commercial advertisements or contain words and/or images which specifically identify or reflect the business, products and/or services provided by any business service or economic activity.
C. This ordinance shall not apply to spaces not visible from the street or other public or private property.
Since content-based restrictions are unenforceable, the mural policy has been revised to eliminate discretionary approval and allow for staff-level approval. Staff will review each application to ensure that the necessary information has been provided, as well as ensure that the application does not propose a mural which is obscene in nature, or proposes commercial speech/depictions.
In taking action on a Zone Text Amendment, the City Council must make the appropriate findings, in accordance with Section 17.86.030 of the Hanford Municipal Code:
1. The amendment is internally consistent with the goals, objectives, and policies of the General Plan and this title;
ANALYSIS: That according to General Plan Policy E8, the City of Hanford shall support local arts and cultural activities that can contribute to the local economy, enrich residents’ lives, and strengthen a sense of community. The revision of Section 17.56.230 of the Hanford Municipal Code is consistent with the policies of the General Plan, as it continues the support of local arts activities that may enrich residents’ lives and strengthen a sense of community.
2. The amendment would not be detrimental to the public health, safety, or welfare of the community;
ANALYSIS: That the revision of Section 17.56.230 of the Hanford Municipal Code is not detrimental to the public health, safety, or welfare of the community.
3. The amendment would maintain the appropriate balance of land uses within the City;
ANALYSIS: That the amendment will not affect the balance of land uses within the City of Hanford.
The zone text amendment pertains to mural regulations, only.
4. The anticipated land uses on the subject site would be compatible with existing and future surrounding uses;
ANALYSIS: That the zone text amendment applies to wall murals in the MX-D Downtown Mixed Use zone district and will not propose a change in land uses.
The proposed mural policy and mural ordinance are attached. Pursuant to Section 15061(b)(3) of the California Environmental Quality Act (CEQA) guidelines, the project is exempt from environmental review.
FISCAL IMPACT:
N/A
ATTACHMENTS:
1. Ordinance 24-01 ZTA 2024-01
2. Proposed Mural Ordinance
3. Mural Policy and Guidelines
4. Notice of Exemption 2024-01
ORDINANCE NO. 24-01
AN ORDINANCE APPROVING ZONE TEXT AMENDMENT NO. 2024-01, A REQUEST BY THE CITY OF HANFORD TO APPROVE ZONE TEXT AMENDMENT NO. 2024-01 AND AMEND TITLE 17, SECTION TITLE 17, SECTION 17.56.230 WALL MURAL PLACEMENT AND DESIGN CRITERIA.
The City Council of the City of Hanford does ordain as follows:
SECTION 1: The Hanford Municipal Code Title 17, the Zoning Ordinance contains regulations to ensure the public health, safety, peace, comfort, convenience, prosperity and general welfare of the citizens of Hanford, including zoning categories, allowed uses and development standards.
SECTION 2: The City Council has held a public hearing on the amendment to Title 17, to amend Title 17, Section 17.56.230 – Wall mural placement and design criteria of the Hanford Municipal Code by adding sections in order to remove the content-based requirements from the City's mural ordinance and replace it with criteria that outlines the application proc ess, allows the City to adopt a mural policy, and prohibits murals that are obscene or classified as commercial advertisements. The proposed ordinance changes are attached as Exhibit A; the proposed mural policy is attached as Exhibit B.
SECTION 3: The City Council finds that the adoption of this ordinance is exempt from environmental review under the California Environmental Quality Act (CEQA) pursuant to the following section of the CEQA Guidelines, 14 Cal. Code of Regulations, Chapter 3.
a) The ordinance is exempt under Section 15061(b) (3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.
SECTION 4: The proposed amendment was evaluated for consistency with the General Plan and the Zoning Ordinance in accordance with Sections 17.86.030 and based on the following findings:
1. The amendment is internally consistent with the goals, objectives, and policies of the General Plan and this title;
ANALYSIS: That according to General Plan Policy E8, the City of Hanford shall support local arts and cultural activities that can contribute to the local economy, enrich residents’ lives, and strengthen a sense of community. The revision of Section 17.56.230 of the Hanford Municipal Code is consistent with the policies of the General Plan, as it continues the support of local arts activities that may enrich residents’ lives and strengthen a sense of community.
2. The amendment would not be detrimental to the public health, safety, or welfare of the community;
ANALYSIS: That the revision of Section 17.56.230 of the Hanford Municipal Code is not detrimental to the public health, safety, or welfare of the community.
3. The amendment would maintain the appropriate balance of land uses within the City;
ANALYSIS: That the amendment will not affect the balance of land uses within the City of Hanford.
The zone text amendment pertains to mural regulations, only.
4. The anticipated land uses on the subject site would be compatible with existing and future surrounding uses;
ANALYSIS: That the zone text amendment applies to wall murals in all the MX-D Downtown Mixed Use zone district and will not propose a change in land uses.
SECTION 5: The City Council of the City of Hanford does ordain that Title 17 is hereby amended, as shown in Exhibit A.
SECTION 6: That the ordinance shall take effect thirty (30) days after its passage, and shall be published once in the Hanford Sentinel within fifteen (15) days after its passage or a summary of this ordinance shall be published in the Hanford Sentinel in a manner consistent with the requirements of the California Government Code.
Passed and adopted at a regular meeting of the City Council of the City of Hanford duly called and held on February 6, 2024, by the following roll call vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
APPROVED
____________________________
Travis Paden
MAYOR of the City of Hanford
ATTEST:
________________________
Natalie Corral
CITY CLERK
STATE OF CALIFORNIA )
COUNTY OF KINGS ) ss
CITY OF HANFORD )
I, NATALIE CORRAL, City Clerk of the City of Hanford, do hereby certify the foregoing ordinance was duly introduced at a regular meeting of the City Council of the City of Hanford on the 6 th
day of February, 2024, and it was duly passed and adopted at a regular meeting of the City Council of the City of Hanford held on the ____ day of ____, 2024.
NATALIE CORRAL
CITY CLERK
17.56.230 Wall mural placement and design criteria.
The Community Development Director is authorized to implement and administer a city mural policy and application process for private structure s, as adopted by the city council by resolution, which establishes requirements for murals on private structures.
A. Allowed Murals. An application which meets all of the following criteria, and which is not otherwise prohibited by this Chapter, will be allowed:
1. Submission of a complete mural application;
2. Compliance with all the requirements of the adopted mural policy and all requirements of this Code;
3. Located within the City’s MX-D zone;
4. Payment of any fees required for a mural permit.
B. Prohibited Murals. The following murals are prohibited:
1. Murals containing statements, words, symbols, or characters of an obscene nature.
2. Murals that contain commercial advertisements or contain words and/or images which specifically identify or reflect the business, products and/or services provided by any business service or economic activity.
C. This ordinance shall not apply to spaces not visible from the street or other public or private property; Exhibit A
Mural Policy and Guidelines
Thank you for your interest in creating a mural in Hanford. To effectively implement a successful mural program, which will ensure consistency and aesthetic value in the community, it is important that applicants adhere to the following guidelines. The application process and guidelines that follow are intended to provide mural applicants with a reasonable process that will safeguard the interests of the community.
Mural Review Process
Murals which are non-commercial, contain no advertising copy, and which do not function as an advertisement are allowed, subject to review by the Community Development Department.
Design Criteria
The Department will verify that the proposed mural:
1. Conforms with City ordinances that prohibit indecency or obscenity in public;
2. Is not an advertisement or commercial in natur e; however, this will in no way limit or restrict the artist’s right to include speech and/or artistic expression in a mural that is not commercial as defined above;
3. Is being painted with the written authorization of the property owner; and
4. Is located within the City’s MX-D Downtown Mixed Use zone district.
The City’s Community Development Department will issue a permit to the applicant if their Mural Application meets the Design Criteria. The Community Development Department may recommend design revisions and require applicants to resubmit if the design criteria are not met.
Appeals
In the event that the applicant fails to receive approval for the submitted mural design they may appeal this decision to the City Council, in accordance with HMC 1.08. (application and fees apply).
Timeframe
In determining the timeframe for the approval process, applicants should allow sufficient time for the mural proposal to be reviewed two times, in the event a recommendation is made by staff for a design revision. Typically, requests for approval should be received no later than 90 days prior to actual implementation of design.
Mural Application
The Mural Application shall contain the following:
1. A rendering or photo of the proposed mural at a 1:12 scale [1 inch = 1 foot] minimum
2. Specifications regarding the mural (location, size, type of paint/media , type of graffiti - proofing);
3. Signed authorization to paint mural from property owner;
4. Expected timeframe for completion;
5. Application for Encroachment Permit and/or Historic Resource Permit, if necessary.
PLEASE NOTE: Once the mural has been approved , the artist may not make additional changes to the design without Community Development Department approval.
Exhibit B
17.56.230 Wall mural placement and design criteria.
The Community Development Director is authorized to implement and administer a city mural policy and application process for private structures, as adopted by the city council by resolution, which establishes requirements for murals on private structures.
A. Allowed Murals. An application which meets all of the following criteria, and which is not otherwise prohibited by this Chapter, will be allowed:
1. Submission of a complete mural application;
2. Compliance with all the requirements of the adopted mural policy and all requirements of this Code;
3. Located within the City’s MX-D zone;
4. Payment of any fees required for a mural permit.
B. Prohibited Murals. The following murals are prohibited:
1. Murals containing statements, words, symbols, or characters of an obscene nature.
2. Murals that contain commercial advertisements or contain words and/or images which specifically identify or reflect the business, products and/or services provided by any business service or economic activity.
C. This ordinance shall not apply to spaces not visible from the street or other public or private property;
Mural Policy and Guidelines
Thank you for your interest in creating a mural in Hanford. To effectively implement a successful mural program, which will ensure consistency and aesthetic value in the community, it is important that applicants adhere to the following guidelines. The application process and guidelines that follow are intended to provide mural applicants with a reasonable process that will safeguard the interests of the community.
Mural Review Process
Murals which are non-commercial, contain no advertising copy, and which do not function as an advertisement are allowed, subject to review by the Community Development Department.
Design Criteria
The Department will verify that the proposed mural:
1. Conforms with City ordinances that prohibit indecency or obscenity in public;
2. Is not an advertisement or commercial in nature; however, this will in no way limit or restrict the artist’s right to include speech and/or artistic expression in a mural that is not commercial as defined above;
3. Is being painted with the written authorization of the property owner; and
4. Is located within the City’s MX-D Downtown Mixed Use zone district.
The City’s Community Development Department will issue a permit to the applicant if their Mural Application meets the Design Criteria. The Community Development Department may recommend design revisions and require applicants to resubmit if the design criteria are not met.
Appeals
In the event that the applicant fails to receive approval for the submitted mural design they may appeal this decision to the City Council, in accordance with HMC 1.08. (application and fees apply).
Timeframe
In determining the timeframe for the approval process, applicants should allow sufficient time for the mural proposal to be reviewed two times, in the event a recommendation is made by staff for a design revision. Typically, requests for approval should be received no later than 90 days prior to actual implementation of design.
Mural Application
The Mural Application shall contain the following:
1. A rendering or photo of the proposed mural at a 1:12 scale [1 inch = 1 foot] minimum
2. Specifications regarding the mural (location, size, type of paint/media, type of graffiti- proofing);
3. Signed authorization to paint mural from property owner;
4. Expected timeframe for completion;
5. Application for Encroachment Permit and/or Historic Resource Permit, if necessary.
PLEASE NOTE: Once the mural has been approved, the artist may not make additional changes to the design without Community Development Department approval.
Notice of Exemption 2024-01
To: Office of Planning and Research
P.O. Box 3044, Room 212
Sacramento, CA 95812-3044
County Clerk
County of Kings
Kings County Government Center
Hanford, CA 93230
From: City of Hanford
317 North Douty Street
Hanford, CA 93230
Project Title: Zone Text Amendment No. 2024-01
Project Location – City of Hanford
Project Location – City: HanfordProject Location – County: Kings County Description of Nature, Purpose and Beneficiaries of Project: Zone Text Amendment No. 2024-01: a request to amend Title 17, Section 17.56.230 of the Hanford Municipal Code in order to remove content-based restrictions on murals and establish a policy for reviewing and approving murals in the City of Hanford Name of Public Agency Approving Project: City of Hanford, Planning Division Name of Person or Agency Carrying Out Project: City of Hanford Exempt Status: (check one)
Ministerial (Sec. 21080(b)(1); 152698);
Declared Emergency (Sec. 21080(b)(3); 15269 (a));
Emergency Project (Sec. 21080(b)(4); 15269(b)(c));
Categorical Exemption: State type and section number:
Statutory Exemption. State code number: 15061(b)(3) General Rule Reasons why project is exempt:
The proposed ordinance is exempt under Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. The proposed project is a text amendment that is not associated with a physical development; therefore, there are no physical impacts that will result from the project.
Lead Agency
Contact Person: Jason Waters Area Code/ Telephone: (559) 585-2590 Signature: Date: January 23, 2024 Title: Deputy City Manager Signed by Lead Agency Date received for filing at OPR:
Signed by Applicant
18.A.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: Successor Agency for the discussion of the following
SUBJECT:
Review And Approval Of The Recognized Obligation Payment Schedule (ROPS 24-25) For The Period July 1, 2024 To June 30, 2025.
RECOMMENDATION:
Recommendation:
That the RDA Successor Agency review and approve the Recognized Obligation Payment Schedule (ROPS 24-25) for the period July 1, 2024 To June 30, 2025.
Recommended Motion:
That the RDA Successor Agency, by motion, approve the Recognized Obligation Payment Schedule (ROPS 24-25) for the period July 1, 2024 to June 30, 2025.
BACKGROUND:
AB 1484 and amendments under SB 107 require Redevelopment Agency (RDA) Successor Agencies to prepare a Recognized Obligation Payment Schedule (ROPS) annually and submit the ROPS to the State Department of Finance (DOF). The ROPS 24-25 is a list of obligations or payments that are, or may be, due within the twelve-month period. The attached ROPS is for the period of July 1, 2024 to June 30, 2025. Once all obligations are paid in full, the Agency can file a dissolving statement with the DOF and future ROPS statements will no longer need to be filed.
Approval of the City of Hanford’s ROPS 24-25 by the Kings County Oversight Board took place at the January 24, 2024 meeting. This approval is necessary in order to submit the ROPS to the State Department of Finance (DOF) by the February 1, 2024 deadline.
The Agency owes Kings Economic Development Corporation (EDC) principal on a loan for purchase of land in the Kings Industrial Park plus appreciated value. The EDC will also be entitled to a portion of the “appreciation” in accordance with the terms of its Promissory Note. As instructed by the DOF, since the amount of appreciation will not be realized until the date of sale, the Agency shall report the outstanding debt as $0.
The subject land was in a long pending lawsuit which was settled with final City Council approval at a Special Meeting held on January 31, 2023. While the lawsuit did not legally prevent other potential buyers from purchasing the land, it did have discouraging effects. Interested parties indicated a
desire to continue negotiations once all legal matters were resolved.
Staff is requesting the (City Council serving as) RDA Successor Agency Board approve the ROPS 24-25 for the period July 1, 2024 - June 30, 2025.
FISCAL IMPACT:
None until sale of land occurs.
ATTACHMENTS:
1. ROPS FY24-25
2. 24-25 ROPS Signed Resolution - Hanford
20.A.
AGENDA
STAFF REPORT
MEETING DATE: 2/6/2024 AGENDA SECTION: GENERAL BUSINESS
SUBJECT:
Authorization to reimburse Woodside 06N, LP, in the amounts of $546,798.00 for the city park land acquisition and improvements for the city neighborhood park located within Tract No. 929, Unit No. 1; AND $94,189.10 for the purchase and dedication of right of way and street improvements on 13th Avenue located outside of development boundaries; AND approve an additional appropriation of $546,798.00 from the Parks Impact Fee Fund, and $94,189.10 from the Transportation Impact Fee Fund to fulfill the reimbursements; AND approve an additional appropriation of $12,800.00 from the Park Impact Fee Fund for Parks Department staff to provide and install solar powered safety lighting and a drinking fountain at Tract 929 neighborhood park.
RECOMMENDATION:
That the City Council, by motion;
1. Authorize a Reimbursement to Woodside 06N, LP In the amount of $204,219.00 for the acquisition and dedication of the city neighborhood park; and $342,579.00 for the park improvements, located within Tract No. 929, Unit No. 1, for a total of $546,798.00;
2. Appropriate an additional $546,798.00 from the Parks Impact Fees fund to fulfill the park land acquisition and improvements reimbursements;
3. Appropriate an additional $12,800.00 from the Parks Impact Fees fund to allow city staff to install the required landscape safety lighting and drinking fountain at the neighborhood park.
4. Authorize a Reimbursement to Woodside 06N, LP In the amount of $26,033.00 for the acquisition and dedication of Right of Way on 13th Avenue located outside of the development boundaries; and $65,656.10 for the street improvements along the frontage as identified in the Conditions of Approval, for a total of $91,689.10;
5. Appropriate an additional $91,689.10 from the Transportation Impact Fee fund to fulfill the reimbursement for the additional right of way acquisition and street improvements on 13th Avenue located outside of the development boundaries.
RECOMMENDED MOTION:
I move that the City Council appropriate and approve reimbursement to Woodside 06N,LP in