Agenda — Lynwood City Council, December 20, 2022 (part 1 of 6)

This Agenda contains a brief general description of each item to be considered. Copies of the Staff reports or other written documentation relating to each item of business referred to on the Agenda are on file in the Office of the City Clerk and are available for public inspection. Any person who has a question concerning any of the agenda items may call the City Manager at (310) 603-0220, ext. 200.

Procedures for Addressing the Council

IN ORDER TO EXPEDITE CITY COUNCIL BUSINESS, WE ASK THAT ALL PERSONS WISHING TO ADDRESS THE COUNCIL SUBMIT YOUR COMMENTS IN ADVANCE TO [email protected] OR FILL OUT A FORM

PROVIDED AT THE PODIUM, AND TO TURN IT IN TO THE CITY CLERK PRIOR TO THE START OF THE MEETING. FAILURE TO FILL OUT SUCH A FORM WILL PROHIBIT YOU FROM ADDRESSING THE COUNCIL IN THE ABSENCE OF THE UNANIMOUS CONSENT OF THE COUNCIL.

AGENDA
City Council Regular Meeting

TO BE HELD ON
December 20, 2022
COUNCIL CHAMBERS - 11350 BULLIS RD. LYNWOOD, CA 90262 or Web conference via ZOOM - To participate via Zoom or by telephone: 1-669-900-9128 or 1-253-215-8782 Meeting ID: 835 2029 8238
Duly Posted on 12/17/22 By MQ
6:00 PM

1. CALL TO ORDER

2. CERTIFICATION OF AGENDA POSTING BY CITY CLERK

3. ROLL CALL OF COUNCIL MEMBERS
Oscar Flores, Mayor
Rita Soto, Mayor Pro Tem
Gabriela Camacho, Council Member
Juan Munoz-Guevara, Council Member
Jose Luis Solache, Council Member

4. PLEDGE OF ALLEGIANCE

5. INVOCATION

6. PRESENTATIONS/PROCLAMATIONS
Update on Law Enforcement Issues
City Council Members Reporting on Meetings Attended (Gov. Code Section 53232.3 (D)).

City Video(s)

7. COUNCIL RECESS TO:

Lynwood Successor Agency
City Council Regular Meeting - Page 1 of 1385
Lynwood Housing AuthorityLynwood Public Financing Authority

PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)

NON-AGENDA PUBLIC ORAL COMMUNICATIONS
THIS PORTION PROVIDES AN OPPORTUNITY FOR THE PUBLIC TO ADDRESS THE COUNCIL ON ITEMSWITHIN THE JURISDICTION OF THE COUNCIL AND NOT LISTED ON THE AGENDA. IF AN ITEM IS NOT ON THEAGENDA, THERE SHOULD BE NO SUBSTANTIAL DISCUSSION OF THE ISSUE BY THE COUNCIL, BUT COUNCILMAY REFER THE MATTER TO STAFF OR SCHEDULE SUBSTANTIVE DISCUSSION FOR A FUTURE MEETING.(The Ralph M. Brown Act, Government Code Section 54954.2 (a).)

PUBLIC HEARING

8. PUBLIC HEARING AND ADOPTION OF RESOLUTION AUTHORIZING ANAMENDMENT TO THE CITY’S PROPOSED FIVE-YEAR PLAN UNDER THEPERMANENT LOCAL HOUSING ALLOCATION (PLHA) GRANT PROGRAM Comments:

The City Council will consider adopting and implementing an amended Five-Year Plan under thePermanent Local Housing Allocation (PLHA) Grant Program. (CD) Recommendation:

Staff recommends that the City Council take the following actions: 1. Conduct a public hearing and take public testimony on the City's proposed amendedFive-Year Permanent Local Housing Allocation Plan; and2. Adopt the attached Resolution entitled "A RESOLUTION OF THE CITY COUNCIL OFTHE CITY OF LYNWOOD, COUNTY OF LOS ANGELES, STATE OF CALIFORNIAAUTHORIZING THE ADOPTION AND IMPLEMENTATION OF AN AMENDED FIVE-YEAR PLAN UNDER THE STATE OF CALIFORNIA HOUSING AND COMMUNITYDEVELOPMENT (HCD) PERMANENT LOCAL HOUSING ALLOCATION (PLHA)PROGRAM."

CONSENT CALENDAR
ALL MATTERS LISTED UNDER THE CONSENT CALENDAR WILL BE ACTED UPON BY ONE MOTIONAFFIRMING THE ACTION RECOMMENDED ON THE AGENDA. THERE WILL BE NO SEPARATE DISCUSSION ONTHESE ITEMS PRIOR TO VOTING UNLESS MEMBERS OF THE COUNCIL OR STAFF REQUEST SPECIFICITEMS TO BE REMOVED FROM THE CONSENT CALENDAR FOR SEPARATE ACTION.

9. APPROVAL OF THE WARRANT REGISTER
Comments:

City of Lynwood warrant register dated December 20, 2022 for FY 2022-2023. (FIN) Recommendation:

Staff respectfully recommends that the City Council of the City of Lynwood approve the warrantregister dated December 20, 2022 for FY 2022-2023.

10. TREASURER'S MONTHLY INVESTMENT REPORT
Comments:

The purpose of this item is to have the Honorable Mayor and the Lynwood City Council review theTreasurer’s Monthly Investment Report as required by State Statutes. (CT) City Council Regular Meeting - Page 2 of 1385

Recommendation:

The following is the Investment Report for the month ending November 30, 2022. This report isprovided to ensure City Council is informed of the Department’s investment activities. The reportsatisfies the recommended reporting requirements of the City of Lynwood, which addresses theCity Council’s request for monthly financial information. It is recommended that the City Council for the City of Lynwood receive and file the attachedMonthly Investment Report.

11. AUTHORIZATION TO APPLY FOR URBAN COMMUNITY DROUGHT RELIEF GRANT Comments:

Harris & Associates was hired by Gateway Management Authority (GWMA) in 2021 to providegrant assistance for new and rehabilitated well projects in Gateway region. GWMA Boardapproved UCDR grant application for wells and well treatment design and planning projects forsix-member cities that indicated interest in participating. Participating Cities: Compton, Downey,Huntington Park, Lynwood, Paramount, and Santa Fe Springs. (PW) Recommendation:

Staff recommends that the City Council adopt the following resolution entitled, “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD APPROVING THE APPLICATIONFOR GRANT FUNDS FOR THE URBAN COMMUNITY DROUGHT RELIEF GRANT BYHARRIS & ASSOCIATES.”

12. REQUEST TO INSTALL RAIN GARDENS ON BULLIS ROAD TO ADDRESSSTORMWATER DRAINAGE Comments:

The construction on the Bullis Road Street Improvement Project was completed on June 22,2020. Staff conducted the final inspection on June 29, 2020 and found that all work wascompleted in accordance with the project plans and specifications. However, there is stormwaterdrainage problem along Bullis Road between Platt Avenue and the Lynwood Unified SchoolDistrict main office driveway. (PW) Recommendation:

Staff recommends that the City Council adopt the following resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENTWITH 316 CONSTRUCTION & ENGINEERING, INC. FOR AN AMOUNT OF $145,150 TOINSTALL THREE RAIN GARDENS PER DESIGN ON BULLIS ROAD; ANDAUTHORIZING THE CITY MANAGER TO APPROVE UP TO TEN PERCENT OF THECONTRACT PRICE FOR ADDITIONAL SERVICES AS NEEDED.”

13. FERNWOOD AVENUE PARK PROJECT CHANGE ORDER LIMIT INCREASEAPPROVAL Comments:

The Fernwood Avenue Park Project consists of the renovation of vacant land into public city park,including walking trail, pedestrian bridge, new landscaping, seating areas, public right awayimprovements and custom playground to decrease impermeable surfaces and runoff, andenhance opportunities for stormwater infiltration management. During construction, the totalamount of $192,956.01 or 8.1% of the original bid amount has been approved up to date for thechange orders and the contractor is requesting approval for additional change order in amount of$164,616.20 for contaminant removal (arsenic) using soil abatement methods. Therefore, thepublic works department is requesting the total change order limit to be increased to $477,059.00or 20% of the original construction contract. (PW) City Council Regular Meeting - Page 3 of 1385
Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “FERNWOODAVENUE PARK PROJECT CHANGE ORDER LIMIT INCREASE APPROVAL.”

14. CIP PRIORITY 2 STREET IMPROVEMENT PROJECT (PHASE 2A) FY 2022-2023CHANGE ORDER APPROVAL Comments:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD ACCEPTING THE CIP PRIORITY 2STREET IMPROVEMENT PROJECT (PHASE 2A) FY 2022-2023 CHANGE ORDERAPPROVAL.”

15. REQUEST TO REPAIR AND REHABILITATE THE NATATORIUM POOL DRAIN ANDOUTLET PIPING Comments:

During review of the current Natatorium Renovation and Emergency Project, staff requested aClosed-Circuit Television (CCTV) video footage of the pool drain and pipe. The CCTV foundthat there are several collapsed areas around the pool drain and throughout the outlet piping withcompaction voids that make it necessary to repair the outlet piping and infrastructure. (PW) Recommendation:

Staff recommends that the City Council adopt the following resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENTWITH 316 CONSTRUCTION & ENGINEERING, INC. FOR AN AMOUNT OF $133,475 TOREPAIR AND REHABILITATE THE NATATORIUM POOL DRAIN AND OUTLET PIPING;AND AUTHORIZING THE CITY MANAGER TO APPROVE UP TO TEN PERCENT OFTHE CONTRACT PRICE FOR ADDITIONAL SERVICES AS NEEDED.”

16. A RESOLUTION OF THE CITY COUNCIL AND THE CITY OF LYNWOOD AMENDINGITS COMPENSATION (SALARY SCHEDULE) PLAN TO COMPLY WITH THE STATEOF CALIFORNIA’S MINIMUM WAGE LAW FOR ITS PART-TIME CASHIER ANDLOCKER ATTENDANT POSITIONS Comments:

In preparation for the upcoming State of California’s Minimum Wage Law increase, the CityCouncil must amend the City’s compensation plan, including any amendments to the salaryschedule, by way of resolution in accordance with Rule V, Sections 1-2 of the City’s PersonnelRules and Regulations. (HR) Recommendation:

City Council Regular Meeting - Page 4 of 1385
Staff recommends that the City Council adopt the attached resolution entitled, “A RESOLUTIONOF THE CITY COUNCIL AND THE CITY OF LYNWOOD AMENDING ITSCOMPENSATION (SALARY SCHEDULE) PLAN TO COMPLY WITH THE STATE OFCALIFORNIA’S MINIMUM WAGE LAW FOR ITS PART-TIME CASHIER AND LOCKERATTENDANT POSITIONS”.

17. CONSIDERATION OF A RESOLUTION PROCLAIMING A LOCAL EMERGENCY,RATIFYING THE PROCLAMATION OF A STATE OF EMERGENCY BY GOVERNORNEWSOM, FINDING THAT THE PROCLAIMED STATE OF EMERGENCYCONTINUES TO IMPACT THE ABILITY TO MEET SAFELY IN PERSON, ANDDECLARING THAT THE CITY COUNCIL AND CITY COMMISSIONS ANDCOMMITTEES WILL COTINUE TO MEET REMOTELY IN ADHERENECE WITH AB361 IN ORDER TO ENSURE THE HEALTH AND SAFETY OF THE PUBLIC Comments:

Beginning in March 2020, Governor Newsom issued a series of Executive Orders aimed atcontaining the novel coronavirus (COVID-19). Among these were several Executive Orders N-25-20, N-29-20, N-35-20 (collectively, the Brown Act Orders) that waived requirements in the BrownAct expressly or impliedly requiring the physical presence of city councilmembers, staff, or thepublic at local agency meetings. On September 16, 2021, Governor Newsom signed Assembly Bill AB 361 (Rivas, 2021), whichallows cities to continue to meet remotely during proclaimed states of emergency under modifiedBrown Act requirements that are similar, but not identical to the rules and procedures establishedby the Brown Act Orders. (CA) Recommendation:

Staff is recommending that the City Council adopt a City Council Resolution entitled: “AResolution Proclaiming a Local Emergency, Ratifying the Proclamation of a State of Emergencyby Governor Newsom, Finding that the Proclaimed State of Emergency Continues to Impact theAbility to Meet Safely in Person, and Declaring that the City Council and City Commissions andCommittees Will Continue to Meet Remotely in Adherence With AB 361 in Order to Ensure theHealth and Safety of the Public”

NEW/OLD BUSINESS

18. SECOND READING OF ORDINANCE NO. 1755
Comments:

The following Ordinance was first read on November 15, 2022 (CC): "AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOODADOPTING BY REFERENCE THE 2022 EDITION OF THE CALIFORNIAADMINISTRATIVE, BUILDING, RESIDENTIAL, MECHANICAL, PLUMBING,ELECTRICAL, GREEN BUILDING STANDARDS, ENERGY, HISTORICALBUILDING, AND EXISTING BUILDING CODES, THE 2021 EDITION OFTHE INTERNATIONAL PROPERTY MAINTENANCE CODE, AND THE 2021EDITION OF THE INTERNATIONAL SWIMMING POOL AND SPA CODE,TOGETHER WITH APPENDICES, AMENDMENTS, DELETIONS ANDPENALTIES, AND AMENDING CHAPTER 11 OF THE LYNWOODMUNICIPAL CODE" Recommendation:

Staff recommends that the City Council adopt and conduct the second reading of Ordinance No.1755 by title only.

19. AWARD OF CONTRACT TO ROBERT D. NIEHAUS, INC. TO PREPARE THE 2023 City Council Regular Meeting - Page 5 of 1385

WATER AND SEWER RATES STUDY
Comments:

The City collects revenues that are intended to be sufficient to cover the costs of operating thewater and sewer systems. These revenues allow the City to protect public health and safely andreliably treat and convey water and sewer. The last increase to the water and sewer rates wasadopted by the City Council on April 18, 2017, which set forth rates for Fiscal Year (FY) 2017 toFY 2021. Changes to the water and sewer rates require a comprehensive cost of water andsewer service study to meet substantive requirements of Proposition 218. Staff issued a Requestfor Proposals and received proposals from seven firms to prepare such study. After review of thewritten proposals of the firms, staff recommends that the contract be awarded to Robert D.Niehaus, Inc. (PW) Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING AN AGREEMENT TOROBERT D. NIEHAUS, INC. TO PREPARE THE 2023 WATER AND SEWER RATESSTUDY; AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT IN AN AMOUNTNOT TO EXCEED $89,900; AND AUTHORIZING THE CITY MANAGER TO APPROVE UPTO TEN PERCENT OF THE CONTRACT PRICE FOR ADDITIONAL SERVICES ASNEEDED."

20. APPROVAL OF AN AGREEMENT BETWEEN THE CITY OF LYNWOOD ANDENTERPRISE FLEET MANAGEMENT, INC. FOR VEHICLE REPLACEMENT ANDMAINTENANCE PROGRAM Comments:

Traditionally the Public Works Department replaces four to five vehicles per year. Given our agedfleet, the City experiences higher maintenance costs, lower fuel efficiency and lower trade in valuewhen replacing. Thus, staff began to research various options to improve the status quo vehicleprocurement and recommends to utilize Enterprise Fleet Management program for vehiclereplacement. (PW) Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD TO IMPLEMENT THE CITY’SVEHICLE REPLACEMENT AND MAINTENANCE PROGRAM, INCLUDING APPROVALOF VARIOUS AGREEMENTS WITH ENTERPRISE FLEET MANAGEMENT, INC. FORTHE LEASE AND MAINTENANCE OF THE CITY’S VEHICLE FLEET”.

21. AWARD OF CONTRACT FOR WATER WELL CASING INSPECTION, AQUIFERFLOW TESTING, AND WATER QUALITY PROFILING AT LYNWOOD WELLS 5, 21,AND 22 IN THE AMOUNT OF $547,152 Comments:

The focus of this project will be to provide the City with detailed information on the condition ofeach well’s casing, how much flow is coming from each of the production aquifers, and finally whatis the water quality being supplied by each aquifer. (PW) Recommendation:

Staff recommends that the City Council adopt the following resolution entitled: “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING AN AGREEMENT TOBESST, INC. TO PROVIDE WATER WELL CASING INSPECTION, AQUIFER FLOWTESTING, AND WATER QUALITY PROFILING AT LYNWOOD WELLS 5, 21, AND 22 INTHE AMOUNT OF $547,152.”

22. AMENDMENT OF VARIOUS CITY CONTRACTS EXTENDING THE TERMS OF THE City Council Regular Meeting - Page 6 of 1385

AGREEMENTS
Comments:

In October 2022, the City adopted ordinances amending its purchasing and professional servicesprocurement procedures and adopted a new contracting & purchasing policy effective early part ofNovember 2022. (CM) Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled, “A RESOLUTIONOF THE CITY COUNCIL OF THE CITY OF LYNWOOD AUTHORIZING THE APPROVALOF AMENDMENTS TO VARIOUS CITY CONTRACTS EXTENDED THE TERMS OFTHE AGREEMENTS”; authorizing the City Manager to execute said amendments as approvedas to form by the City Attorney's Office.

23. MAYORAL APPOINTMENTS
Comments:

Members of the City Council serve on various municipal organizations that require representationof government officers. This participation allows the City to receive beneficial information andresources. Previously, the Mayor has made appointments to the organizations, with approval andratification of members of the City Council. As a result of the City Council's recent reorganization,the Mayor and Council will review and update the list of appointments accordingly. (CC) Recommendation:

Staff recommends that the Mayor and Council review and appoint delegates and alternates forthe various organizations and committees, and direct staff to notify said organizations on theappointments.

24. REVIEW OF BOARD, COMMISSION AND COMMITTEE MEMBERS & ANNUALBOARDS, COMMISSIONS AND COMMITTEES LOCAL APPOINTMENT LIST Comments:

Review of Board and Commission Members & Annual Boards and Commissions LocalAppointment List. (CC) Recommendation:

Staff recommends that the City Council review the list of Board and Commission members. Currently, there are a total of 10 vacancies on the various Boards and Commissions including:two vacancies for the Community Development Block Grant Board, two vacancies for the PublicSafety/Traffic & Parking Commission, two vacancies for the Personnel Board, two vacancies forthe Planning Commission and two vacancies for the Citizens Oversight Committee. In accordance with the rules outlined below, the City Council may make any adjustments to theseBoards and Commissions, as it deems appropriate.

Additionally, staff recommends that the City Council direct staff to post the attached annual City ofLynwood Boards and Commission Appointment List pursuant to Government Code Section54970 requirements.

25. CITY COUNCIL ORAL AND WRITTEN COMMUNICATION

26. STAFF ORAL COMMENTS

ADJOURNMENT
THE NEXT REGULAR MEETING WILL BE HELD ON JANUARY 17, 2023 AT 6:00 P.M. IN THECOUNCIL CHAMBERS OF THE CITY HALL ANNEX, 11350 BULLIS ROAD, CITY OFLYNWOOD, CALIFORNIA.

City Council Regular Meeting - Page 7 of 1385
Agenda Item # 8.

AGENDA STAFF REPORT
DATE: December 20, 2022 TO: Honorable Mayor and Members of the City Council APPROVED BY: Ernie Hernandez, City Manager PREPARED BY: Gabriel Linares, Director of Community Development SUBJECT: PUBLIC HEARING AND ADOPTION OF RESOLUTION AUTHORIZING AN AMENDMENT TOTHE CITY’S PROPOSED FIVE-YEAR PLAN UNDER THE PERMANENT LOCAL HOUSINGALLOCATION (PLHA) GRANT PROGRAM Recommendation:

Staff recommends that the City Council take the following actions: 1. Conduct a public hearing and take public testimony on the City's proposed amended Five-Year Permanent LocalHousing Allocation Plan; and2. Adopt the attached Resolution entitled "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD,COUNTY OF LOS ANGELES, STATE OF CALIFORNIA AUTHORIZING THE ADOPTION ANDIMPLEMENTATION OF AN AMENDED FIVE-YEAR PLAN UNDER THE STATE OF CALIFORNIA HOUSINGAND COMMUNITY DEVELOPMENT (HCD) PERMANENT LOCAL HOUSING ALLOCATION (PLHA)PROGRAM." Background:

In September 2017, the California Legislature approved Senate Bill 2 (SB 2), known as the Building Homes and Jobs Act(Act}, which established a $75 recording fee on real estate documents to increase the supply of affordable housing. The Actestablishes the Permanent Local Housing Allocation (PLHA) program administered by the California Department of Housingand Community Development (HCD). The PLHA provides a permanent source of funding to cities and counties to help meetthe unmet need for affordable housing and increase the supply of affordable housing units. HCD released its first Notice ofFunding Availability for these funds on February 26, 2020. Under the PLHA, funding is provided through formula grants to entitlement jurisdictions based on the formula prescribed underfederal law for the Community Development Block Grant (CDBG) program over a five-year funding period (2019, 2020, 2021,2022, and 2023), as well as through a competitive grant program to non-entitlement jurisdictions. The City of Lynwood is anentitlement jurisdiction and is eligible to receive an estimated $3,788,322 over the five-year funding period. It is important to notethat the five-year funding amount is only an estimate since annual PLHA amounts are subject to change. This is because funding forthe PLHA is generated through a fee on real estate transactions, which may fluctuate from year to year. According to HCD, the City willreceive first-year funds (2019) of $631,387. The primary goal of the PLHA program is to create a permanent source of funding available to eligible local governments inCalifornia for housing-related projects and programs to address unmet housing needs in their local communities. In order toreceive PLHA funds, the City is required to submit a PLHA Plan (Plan) detailing the manner in which allocated funds will beused; a description of the way the local government will prioritize investments that increase the supply of housing for householdsat or below 60 percent of AMI ; a description of how the Plan is consistent with the programs set forth in the City's HousingElement; and evidence that the Plan was authorized and adopted by resolution by the City Council and that the public had an City Council Regular Meeting - Page 8 of 1385
Element; and evidence that the Plan was authorized and adopted by resolution by the City Council and that the public had anadequate opportunity to review and comment on its content.

Discussion and Analysis:

The City is considered an Entitlement Local government, and was awarded a 2019 formula allocation of PLHA funds in theamount of $631,387. The approximate PLHA five-year formula allocation amount is $3,788,322. PLHA funds must be used tocarry out one or more of the eligible activities listed below: 1. The predevelopment, development, acquisition, rehabilitation, and preservation of multifamily, residential live-work, rentalhousing that is affordable to extremely low-, very low-, low-, or moderate-income households, including necessaryOperating subsidies.2. The predevelopment, development, acquisition, rehabilitation, and preservation of Affordable rental and ownershiphousing, including Accessory Dwelling Units (ADUs), that meets the needs of a growing workforce earning up to 120percent of Area Median Income (AMI), or 150 percent of AMI in High-cost areas. ADUs shall be available for occupancyfor a term of no less than 30 days. See Appendix B for a list of High-cost areas in California.3. Matching portions of funds placed into Local or Regional Housing Trust Funds.4. Matching portions of funds available through the Low- and Moderate-Income Housing Asset Fund pursuant to subdivision(d) of HSC Section 34176.5. Capitalized Reserves for Services connected to the preservation and creation of new Permanent supportive housing.6. Assisting persons who are experiencing or at-risk of homelessness, including, but not limited to, providing rapidrehousing, rental assistance, supportive/case management services that allow people to obtain and retain housing,operating and capital costs for navigation centers and emergency shelters, and the new construction, rehabilitation, andpreservation of permanent and transitional housing.7. Accessibility modifications in Lower-income Owner-occupied housing.8. Efforts to acquire and rehabilitate foreclosed or vacant homes and apartments.9. Homeownership opportunities, including, but not limited to, down payment assistance.10. Fiscal incentives made by a county to a city within the county to incentivize approval of one or more Affordable housingprojects, or matching funds invested by a county in an Affordable housing development project in a city within the county,provided that the city has made an equal or greater investment in the project. The county fiscal incentives shall be in theform of a grant or low-interest loan to an Affordable housing project. Matching funds investments by both the county andthe city also shall be a grant or low-interest deferred loan to the Affordable housing project. In order to participate in the formula allocation, the City was required to develop a five-year plan detailing the manner in whichallocated funds will be used for eligible activities. On August 4, 2020, City Council adopted a five-year plan approving the fundsto target individuals and households experiencing homelessness by either using the funds towards land cost and construction ofan emergency shelter or utilizing a City-owned facility to develop the emergency shelter. The activities selected for the five-yearprogram was Activity 6 that include the provision of housing and supportive case management services to homelessindividuals. The City staff working group reanalyzed the cost of developing an emergency homeless shelter and concluded that this projectis no longer a viable option due to the cost of available land, the increase in construction cost and the ongoing staffing cost of aproposed emergency homeless shelter facility. Lynwood residents’ needs have also shifted to housing retention andstabilization as a direct result of Covid-19 financial impacts on the local economy. Since Lynwood residents are moreimmediately benefited by shifting the 2019 awarded funding to rental assistance, a request was submitted and approved byHCD to reallocate the shelter funds to the rental assistance program. The utilization of HCD rental assistance funding sourcewill be effective 2023 and permitted until early 2024. Prior to receiving PHLA funds the City must amend its five-year plan to include rental assistance. As such, HCD requires theCity council approve the amendment seeking to revise its current 2019 formula allocation plan from an Emergency Shelter to adefined, short-term housing Rental Assistance Program. The 2019 formula allocation of PLHA funds is $631,387 and will bereleased to Lynwood upon City Council approval and HCD approval of the rental assistance program process.

The working group proposed revising the remaining four-(4) years (2020-2023) of the approved five-year plan from Activity 6 toActivities 1, 2, 7, 8 and 9. The new allocation will allow more flexibility when proposing enhancements to Lynwood affordablehousing needs. The change will permit for the upgrade, development and preservation of affordable housing that targets mostof Lynwood’s housing incomes and allows for the partnering with housing developers to meet community’s housing and homeownership needs.

City Council Regular Meeting - Page 9 of 1385

1. Activity 1: The predevelopment, development, acquisition, rehabilitation, and preservation of multifamily, residentiallive-work, rental housing that is affordable to extremely low, very low-, low-, or moderate-income households, includingnecessary Operating subsidies. 2. Activity 2: The provision of pre-approved Accessory Dwelling Unit (ADU) building and structural plans to incomequalifying individuals and households with options to several of the most popular and cost-effective ready-to issue buildingplans. 3. Activity 7: ADA installations to aid aging and disabled, single-family property owners and residents. The installationswill consist of, but not completely limited to, handicap ramps, egress windows and framing, and other interior upgrades thatpromote mobility and accessibility for these households. 4. Activity 8: Acquire and rehabilitate vacant and out-of-repair homes typically vacated by the relocation of elderly homeowners by family and/or extended family members that reside out-of-state or outside of the functional distance of theproperty. 5. Activity 9: Direct, or in partnership, acquisition and rehab of Activity 8 properties for the development and maintenanceof income -restricted, affordable housing units with an option of condominium conversions (by means other than downpayment assistance). Approving the proposed amendment of the 5-year PHLA programs will allow the City of Lynwood to provide immediateassistance to our local residents through short-term housing rental assistance until 2024 and position future PHLA funding(2022-2028) for more long-term housing solutions that include development of affordable low-income units that will assistLynwood’s in meeting its Regional Housing Need Allocation (RHNA) numbers.

Fiscal Impact:

HCD awarded the City a 2019 formula allocation that will be a pass through grant fund of $631,387 for projects specific to thegrant. No Fiscal Impact to the General Fund.

Coordinated With:

City Manager's Office
ATTACHMENTS:Description
Resolution Amending five year PHLA program
City Council Regular Meeting - Page 10 of 1385
RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD, COUNTY OF

LOS ANGELES, STATE OF C ALIFORNIA AUT HORIZING THE ADOP TION AND

IMPLEMENTATION OF A N AMENDED FIVE-YEAR PLAN UNDER THE STATE OF

CALIFORNIA HOUSING AND COMMUNITY DEVELOPMENT (HCD) PERMANENT

LOCAL HOUSING ALLOCATION (PLHA) PROGRAM

WHEREAS, the Department is authorized to provide up to $ 195 million under the SB 2 Permanent Local Housing Allocation Program Formula Component from the Building Homes and Jobs Trust Fund for assistance to Cities and Counties (as described in Health and Safety Code section 50470 et seq. (Chapter 364, Statutes of 2017 (SB 2)); and

WHEREAS, the State of California (the “State”), Department of Housing and Community Development (“Department”) issued a Notice of Funding Availability (“NOFA”) dated 02/26/2020 under the Permanent Local Housing Allocation (PLHA) Program; and

WHEREAS, the City of Lynwood is an eligible Local government applying for the program to administer one or more eligible activities; and

WHEREAS, the Department may approve funding allocations for PLHA Program, subject to the terms and conditions of the Guidelines, NOFA, Program requirements, the Standard Agreement and other contracts between the Department and PLHA grant recipients.

WHEREAS, in order to participate in the formula allocation, the City of Lynwood is required to develop a Five-Year PLHA Plan describing how the City will allocate funds among the eligible activities; how investments will prioritize households with incomes at 60% and below of the area median income (AMI); and how the Five-Year PLHA Plan is consistent with the City’s Housing Element; and

WHEREAS, a copy of the City of Lynwood’s amended Five-Year PLHA Plan was made available for public review and comment from December 8, 2022 through December 20, 2022, on the City’s website; and

WHEREAS, the City of Lynwood did not receive any comments during the p ublic review and comment period; and

WHEREAS, on December 20 , 2022 , the City Council for the City of Lynwood conducted a duly advertised public hearing on the adoption of the City’s amended Five- Year PLHA Plan, at which time evidence, both oral and written, including a staff report were presented and received, and comments w ere heard from all interested parties appearing in the matter.

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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, DETERMINE, ORDER AND RESOLVE AS FOLLOWS:

Section 1. The City Council of the City of Lynwood hereby finds and determines that all of the foregoing recitals are true and correct and are incorporated herein by reference.

Section 2. The City of Lynwood has prepared an amended Five-Year PLHA Plan for the period 2019, 2020, 2021, 2022, and 2023 in accordance with PLHA Program regulations.

Section 3. The City Council of the City of Lynwood hereby adopts the amended Five- Year PLHA Plan, which is attached hereto as Exhibit A.

Section 4. If the City of Lynwood receives a grant of PLHA funds from the Department pursuant to the above referenced PLHA NOFA, it represents and certifies that it will use all such funds in a manner consistent and in compliance with all applicable state and federal statutes, rules, regulations, and laws, including without limitation all rules and laws regarding the PLHA Program, as well as any and all contracts the City of Lynwood may have with the Department.

Section 5. The City of Lynwood hereby agrees to use the PLHA funds for eligible activities as approved by the Department and in accordance with all Program requirements, Guidelines, other rules and laws, as well as in a manner consistent and in compliance with the Standard Agreement and other contracts between the Applicant and the Department.

Section 6. Pursuant to the City of Lynwood ’s certification in this resolution , the PLHA funds will be expended only for eligible Activities and consistent with all program requirements.

Section 7. The City of Lynwood shall be subject to the terms and conditions as specified in the Standard Agreement, the PLHA Program Guidelines and any other applicable SB 2 Guidelines published by the Department.

Section 8. The Lynwood City Council herby authorizes the City Manager , Er nie Hernandez, or his designee to execute PLHA Program Applications, the PLHA Standard Agreements and any subsequent amendments or modifications thereto, as well as any other documents , which are related to the Program or the PLHA grant awarded to Applicant, as the Department may deem appropriate.

Section 9. The City Clerk shall certify to the adoption of this resolution and hereafter the same shall be in full force and effect.

[SIGNATURES ON FOLLOWING PAGE]
City Council Regular Meeting - Page 12 of 1385

PASSED, APPROVED and ADOPTED this 20th day of December 2022.

Oscar Flores, Mayor

ATTEST:

Maria Quinonez
City Clerk

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

Noel Tapia Ernie Hernandez
City Attorney City Manager

City Council Regular Meeting - Page 13 of 1385

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the above and foregoing resolution was duly adopted by the City Council of the City of Lynwood at a regular meeting held in the City Hall of said City on the 20th day of December 2022, and passed by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

_______________________________
Maria Quinonez, City Clerk

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSENT:

ABSTAIN:

_______________________________
Maria Quinonez, City Clerk
City Council Regular Meeting - Page 14 of 1385
Agenda Item # 9.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Harry Wong, Director of Finance & AdministrationLilly Hampton, Senior Accounting Technician SUBJECT: APPROVAL OF THE WARRANT REGISTER
Recommendation:

Staff respectfully recommends that the City Council of the City of Lynwood approve the warrant register datedDecember 20, 2022 for FY 2022-2023.

Background:

N/A
Discussion and Analysis:

N/A
Fiscal Impact:

FY 2022-2023
Coordinated With:

City ManagerCity Attorney
ATTACHMENTS:Description
WARRANT RUN 12 20 2022

RESOLUTION ITEM
City Council Regular Meeting - Page 15 of 1385
apCkHist Void-Check Listing Page: 1
12/15/2022 7:08AM City of Lynwood
Bank code: apbank
Void Check# Date Vendor Status ClearNoid Date Reason-Void Reissue Inv. Date Amount Paid Check Total --
203641 01/18/2022 012761 EFFIE ALAILEFALEULA 12/08/2022 STALE DATED 04/28/2020 25.00 25.00 204431 04/19/2022 013405 EHUDl,LLC 12/08/2022 STALE DATED 07/26/2021 160.00 160.00 204436 04/19/2022 012886 GULLERMINA OLEA 12/08/2022 STALE DATED 07/16/2020 800.00 800.00 204842 06/21/2022 013579 MARIA JANNETT BENNETT 12/08/2022 STALE DATED 05/24/2022 38.00 38.00 204846 06/21/2022 013597 TIMOTHY LEO CAKOUROS 12/08/2022 STALE DATED 05/24/2022 25.00 25.00 204854 06/21/2022 013587 JUAN GALINDO CARRERA 12/08/2022 STALE DATED 05/24/2022 69.00 69.00 204861 06/21/2022 013576 GRAHAM TERESA 12/08/2022 STALE DATED 05/24/2022 69.00 69.00 204923 06/21/2022 013580 KEMANIE PATTERSON 12/08/2022 STALE DATED 05/24/2022 55.00 55.00 204958 06/21/2022 013563 JAMES MARIE WAL TA 12/08/2022 STALE DATED 05/24/2022 69.00 69.00 205130 07/19/2022 013608 ANYSSA AMAYA 12/13/2022 STALE DATED 206368 06/13/2022 600.00 600.00 205138 07/19/2022 001046 BAVCO 12/13/2022 STALE DATED 206369 06/24/2022 2,204.78 2,204.78 205283 08/02/2022 001479 DAVE BANG ASSOC,. INC. 12/13/2022 STALE DATED 206371 06/30/2022 6,432.59 6,432.59 205365 08/02/2022 012692 RITA SOTO 12/13/2022 STALE DATED 206372 08/31/2022 500.00 500.00 205428 08/16/2022 000300 BUBBS HARDWARE 12/13/2022 STALE DATED 206370 07/26/2022 13.36 12/13/2022 237 07/14/2022 11.05 24.41
205468 08/23/2022 008668 JOSE LUIS SOLACHE 12/12/2022 STALE DATED 206362 09/30/2022 500.00 500.00 205484 08/31/2022 008668 JOSE LUIS SOLACHE 12/12/2022 STALE DATED 206361 08/11/2022 259.00 259.00 apbank Total: 11,830.78
16 checks in this report Total Checks : 11,830.78
Page: 1
City Council Regular Meeting - Page 16 of 1385
vchlist
12/14/2022
Bank code:

Voucher
1430
1436
1447
1455
1458
1461
1462
1465
1467
1468
1469
1471
1472
5:14:07PM
Electronic Financial Transaction List
City of Lynwood
apbank
Date Vendor Invoice PO#
8/19/2022 013507 NATIONWIDE RETIREMENT SOLUTION Ben147105 9/2/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben147292 10/7/2022 013073 CALPERS INSURANCE Ben147615
10/7/2022 013073 CALPERS INSURANCE Ben147861
10/19/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben147867 10nt2022. 013073 CALPERS INSURANCE Ben147906
10/18/2022 013090 PERS Ben147908
10/19/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben147915 10/20/2022 012556 MUNICIPAL DENTAL POOL Ben148260
10/6/2022 005794 INTERNAL REVENUE SERVICE Ben148262
11/9/2022 013073 CALPERS INSURANCE Ben148264
10/6/2022 001357 EMPLOYMENT DEVELOPMENT DEPT. Ben148268 10/13/2022 013091 PERS 457 Ben148270
Page: 2
Description/Account Amount
401A: PAYMENT 186.26
Total : 186.26
DEF COMP- NATIONWIDE: 500.00
Total: 500.00
BLUE SHIELD ACCESS+: PAYMENT 58,736.99
Total : 58,736.99
PERS PLATINUM - MONTHLY: 3,022.71
Total: 3,022.71
DEF COMP - NATIONWIDE: 500.00
Total: 500.00
CALPERS INSURANCE PAYMENT 58,603.78
Total : 58,603.78
PERS: PAYMENT 58,204.34
Total : 58,204.34
DEF COMP- NATIONWIDE: 11 ,481 .18
Total : 11,481.18
DELTA DENTAL: PAYMENT 4,604.67
Total: 4,604.67
SOCIAL SECURITY: PAYMENT 48,693.45
Total : 48,693.45
BLUE SHIELD ACCESS+: PAYMENT 57,706.05
Total : 57,706.05
STATE WITHHOLDING TAXES: 14,691.46
Total: 14,691.46
DEF COMP- PERS 457: PAYMENT 6,836.04
Page: 2
City Council Regular Meeting - Page 17 of 1385
vchlist Electronic Financial Transaction List Page: 3
12/14/2022 5:14:07PM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 1472 10/13/2022 013091 013091 PERS 457 (Continued) Total: 6,836.04 1473 10/19/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben148272 DEF COMP - NATIONWIDE: 9,715.93 Total: 9,715.93
1474 10/19/2022 013507 NATIONWIDE RETIREMENT SOLUTION Ben148274 401A: PAYMENT 201.44 Total : 201.44
1475 10/20/2022 012556 MUNICIPAL DENTAL POOL Ben148475 DEL TA DENTAL: PAYMENT 227.98 Total : 227.98
1476 10/20/2022 005794 INTERNAL REVENUE SERVICE Ben148477 SOCIAL SECURITY: PAYMENT 694.63 Total: 694.63
1477 11/9/2022 013073 CALPERS INSURANCE Ben148479 PERS PLATINUM - MONTHLY: 3,022.71 Total: 3,022.71
1479 10/25/2022 013091 PERS 457 Ben148483 DEF COMP- PERS 457: PAYMENT 1,500.00 Total: 1,500.00
1480 10/26/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben148485 DEF COMP - NATIONWIDE: 500.00 Total: 500.00
1481 10/20/2022 012556 MUNICIPAL DENTAL POOL Ben148528 DELTA DENTAL: PAYMENT 4,561.31 Total: 4,561.31
1482 10/20/2022 005794 INTERNAL REVENUE SERVICE Ben148530 SOCIAL SECURITY: PAYMENT 67,559.67 Total: 67,559.67
1483 11/9/2022 013073 CALPERS INSURANCE Ben148532 CALPERSINSURANCEPAYMENT 55,175.72 Total: 55,175.72
1485 10/20/2022 001357 EMPLOYMENT DEVELOPMENT DEPT. Ben148536 STATE WITHHOLDING TAXES: 19,518.29 Total: 19,518.29
1487 10/26/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben148540 DEF COMP- NATIONWIDE: 9,659.17 Total : 9,659.17
1488 10/26/2022 013507 NATIONWIDE RETIREMENT SOLUTION Ben148542 401A: PAYMENT 201.44 Page: 3
City Council Regular Meeting - Page 18 of 1385
vchlist Electronic Financial Transaction List Page: 4
12/14/2022 5:14:07PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 1488 10/26/2022 013507 013507 NATIONWIDE RETIREMENT (Continued) Total : 201.44 1489 11/10/2022 012556 MUNICIPAL DENTAL POOL Ben148892 DEL TA DENTAL: PAYMENT 4,561.65 Total : 4,561.65
1494 11/9/2022 013091 PERS 457 Ben148902 DEF COMP- PERS 457: PAYMENT 5,986.04 Total: 5,986.04
1495 11/14/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben148904 DEF COMP - NATIONWIDE: 11,994.96 Total ; 11,994.96
1496 11/14/2022 013507 NATIONWIDE RETIREMENT SOLUTION Ben148906 401A: PAYMENT 201.44 Total : 201.44
1497 11/10/2022 012556 MUNICIPAL DENTAL POOL Ben149198 DELTA DENTAL: PAYMENT 4,561.65 Total : 4,561.65
1503 11/25/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben149210 DEF COMP- NATIONWIDE: 11,619.96 Total : 11,619.96
1505 11/10/2022 012556 MUNICIPAL DENTAL POOL Ben149221 DEL TA DENTAL: PAYMENT 77.99 Total : 77.99
1510 11/25/2022 010069 NATIONWIDE RETIREMENT SOLUTION Ben149231 DEF COMP - NATIONWIDE: 500.00 Total : 500.00
1005231 10/4/2022 000372 FIRE DEPARTMENT, LOS ANGELES C0010698 01-001724 FIRE PROTECTION SERVICES 661,575.62 Total : 661,575.62
1005232 10/7/2022 013073 CALPERS INSURANCE 100000016939491 MEDICAL PREMIUM 10/2022 49,259.25 100000016939493 MEDICAL PREMIUM 10/2022 305.91
Total: 49,565.16
1005233 10/20/2022 000124 CITY OF LYNWOOD 35415-35479 REPLENISH WORKERS' COMP 21,947.62 Total: 21,947.62
1005234 10/20/2022 009720 CITY OF LYNWOOD 2112-2117 REPLENISH LIABILITY ACCOUNT 23,334.09 Total: 23,334.09
Page: 4
City Council Regular Meeting - Page 19 of 1385
vchlist
12/14/2022
Bank code:

Voucher
1005235
1005236
1005237
1005238
1005239
1005240
1005241
1005242
1005243
1005244
1005245
5:14:07PM
apbank
Date Vendor
10/20/2022 013121 AUL HEAL TH BENEFIT TRUST C/O,
10/20/2022 012556 MUNICIPAL DENTAL POOL
11/3/2022 000372 FIRE DEPARTMENT, LOS ANGELES
11/9/2022 013073 CALPERS INSURANCE
10/25/2022 013090 PERS
11/10/2022 007811 WELLS FARGO BANK
11/10/2022 001211 THE BANK OF NEW YORK MELLON
11/22/2022 013121 AUL HEALTH BENEFIT TRUST C/O,
11/22/2022 011941 ZIONS BANK DIVISION
11/23/2022 010935 WESTERN ALLIANCE BANK
11/10/2022 012556 MUNICIPAL DENTAL POOL
49 Vouchers for bank code : apbank
Electronic Financial Transaction List
City of Lynwood
Invoice PO#
013121-113022
012556-113022
C0010772 01-001724
100000016971757
100000016971758
013090-1 02522
MEASURE R-12/22 02-002640
L YNWOOD14A-1222 02-002635
LYNWOOD17A-1222 02-002636
LYNWOOD17B-1222 02-002637
LYNWOOD20A-1222 02-002638
013121-123122
LPFA2019B-102522 02-002642
LR BOND-2017/2003A 02-002620
012556-123122
Page: 5
Description/Account Amount
REIMB-RETIREE MEDICAL 11/2022 27,844.57
Total : 27,844.57
DENTAL PREMIUM 11/2022 7,398.24
Total : 7,398.24
FIRE PROTECTION SERVICES 661 ,604.00
Total : 661,604.00
MEDICAL PREMIUM 11/2022 47,953.81
MEDICAL PREMIUM 11/2022 305.91
Total: 48,259.72
EMPLOYER CONTRIBUTION 1,114.95
Total: 1,114.95
DEBT SERVICE PAYMENT 79,308.25
Total : 79,308.25
DEBT SERVICE PAYMENT 78,366.75
DEBT SERVICE PAYMENT 53,179.50
DEBT SERVICE PAYMENT 298,853.14
DEBT SERVICE PAYMENT 364,253.13
Total: 794,652.52
REIMB-RETIREE MEDICAL PREMIUM 27,844.57
Total: 27,844.57
DEBT SERVICE PAYMENT 38,487.77
Total: 38,487.77
DEBT SERVICE PAYMENT 78,366.75
Total: 78,366.75
RETIREE DENTAL PREMIUM 12/2022 7,590.91
Total: 7,590.91
Bank total: 3,064,703.65
Page: 5
City Council Regular Meeting - Page 20 of 1385
vchlist
12/14/2022
Bank code:

Voucher
1486
5:20:09PM
apbank
Date Vendor
10/25/2022 013091 PERS 457
1 Vouchers for bank code :
1 Vouchers in this report
apbank
Electronic Financial Transaction List
City of Lynwood
Invoice PO#
- ------
Ben148538
Description/Account
DEF COMP - PERS 457: PAYMENT
Total:

Bank total:

Total vouchers :

Page: 6
Amount
6,836.04
6,836.04
6,836.04
6,836.04
Page: 6
City Council Regular Meeting - Page 21 of 1385
vchlist Prepaid-Check List Page: 7
12/14/2022 3:58:00PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206316 12/6/2022 013421 ALVAREZ, SALVADOR 723440 REIMB-CERTIFICATE RENEWAL FEE 297.00 Total: 297.00
206317 12/6/2022 013604 ARRENDONDO, MARIELA 1805 COMMUNITY ACTIVITY EXPENSE 1,000.00 Total : 1,000.00
206318 12/6/2022 003352 DEPT. OF JUSTICE CTRL SERVICES 614286 05-001946 BACKGROUND CHECKS 64.00 Total: 64.00
206319 12/6/2022 013459 ENRIQUEZ, FRANCIS 1057 COMMUNITY ACTIVITY EXPENSE 595.00 Total: 595.00
206320 12/6/2022 013503 FINANCIAL SERVICES LLC, PITNEY 3105785575 05-001944 EQUIPMENT RENTAL 865.07 Total : 865.07
206321 12/6/2022 013709 HUB CITIES CAREER CENTER CORP Tweedy2022 RELOCATION 200,000.00 Total: 200,000.00
206322 12/6/2022 007606 LOPEZ, JUAN 023 COMMUNITY ACTIVITY EXPENSE 1,000.00 Total: 1,000.00
206323 12/6/2022 013661 M & J CARPETS CORPORATION 62252 COMMUNITY ACTIVITY EXPENSE 1,065.82 Total: 1,065.82
206324 12/6/2022 000111 MANAGED HEAL TH NETWORK PRM-075958 05-001935 EMPLOYEE ASSISTANCE 303.05 PRM-076767 05-001935 EMPLOYEE ASSISTANCE 303.05
Total : 606.10
206325 12/6/2022 013474 PETTY CASH-C.M.O.-1 013474110222 REPLENISH PETTY CASH BOX 978.05 Total : 978.05
206326 12/6/2022 008664 PINS ADVANTAGE 2320 SUBSCRIPTION DUES 137.50 Total : 137.50
206327 12/6/2022 009571 RAMON'S LINEN 02496 LINEN RENTAL SERVICES 110.00 Total : 110.00
Page: 7
City Council Regular Meeting - Page 22 of 1385
vchlist Prepaid-Check List Page: 8
12/14/2022 3:58:00PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206328 12/6/2022 000163 SOUTHERN CALIFORNIA EDISON 000163112822 LIGHT & POWER SERVICES 17,226.51 Total: 17,226.51
206329 12/6/2022 001224 STANDARD INSURANCE COMPANY 001224-123122 LIFE INSURANCE PREMIUM 773.00 Total: 773.00
206330 12/6/2022 000164 THE GAS CO. 000164112822 GAS SERVICES 1,045.98 Total : 1,045.98
206331 12/6/2022 013487 TRUSAIC CINV-024442 PROF & CONTRACTUAL SERVICE 500.00 CINV-025116 PROF & CONTRACTUAL SERVICE 500.00
Total: 1,000.00
206332 12/6/2022 005282 FRANCHISE TAX BOARD Ben149593 FRANCHISE TAX BOARD: PAYMENT 84.37 Total: 84.37
206333 12/6/2022 013084 LE, JESSICA Ben149591 JESSICA HERRERA: PAYMENT 293.00 Total : 293.00
206334 12/6/2022 001224 STANDARD INSURANCE COMPANY Ben148876 LIFE INSURANCE: PAYMENT 647.98 Ben149182 LIFE INSURANCE: PAYMENT 647.98
Ben149217 LIFE INSURANCE: PAYMENT 111.04
Total : 1,407.00
206335 12/6/2022 013710 ARMENTA , CYNTHIA 118 COMMUNITY ACTIVITY EXPENSE 400.00 Total : 400.00
206336 12/6/2022 006399 AT&T 000019041171 TELEPHONE SERVICE 88.32 000019041282 TELEPHONE SERVICE 45.00
000019101351 TELEPHONE SERVICE 1,230.39
000019124060 TELEPHONE SERVICE 98.39
Total : 1,462.10
206337 12/6/2022 013105 CALIFORNIA STREET LIGHTING 924 06-009791 PROF & CONTRACTUAL SERVICE 45,000.00 Total : 45,000.00
206338 12/6/2022 008216 NOVA STORAGE 62557 STORAGE FEE 86.75 Page: 8
City Council Regular Meeting - Page 23 of 1385
vchlist Prepaid-Check List Page: 9
12/14/2022 3:58:00PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206338 12/6/2022 008216 008216 NOVA STORAGE (Continued) Total : 86.75 206339 12/6/2022 011759 PAGEANTRY PARADES CCLP220002 08-005062 HOLIDAY PARADE 2022 13,625.00 CCLP220003 08-005062 HOLIDAY PARADE 2022 17,500.00
CCLP220004 08-005062 HOLIDAY PARADE 2022 12,150.00
Total: 43,275.00
206340 12/6/2022 000163 SOUTHERN CALIFORNIA EDISON 000163120522 LIGHT & POWER SERVICES 53,151.44 Total : 53,151.44
206341 12/6/2022 001302 U.S. BANK 001302-111522 BANKCARD CHARGES 3,820.61 001302-111522-A BANKCARD CHARGES 451 .80
001302-111522-B BANKCARD CHARGES 1,308.07
001302-111522-C BANKCARD CHARGES 1,532.28
001302-111522-D BANKCARD CHARGES 866.61
001302-111522-E BANKCARD CHARGES 1,972.20
Total: 9,951.57
206342 12/7/2022 013497 ALTA LANGUAGE SERVICES, INC IS625306 05-001937 SPANISH BILINGUAL TESTING 55.00 Total : 55.00
206343 12/7/2022 001552 CARRILLO , ROSALIA 113376 REI MB-GIFT CARDS PURCHASE 2,125.00 Total : 2,125.00
206344 12/7/2022 013473 CONTROLLING INSURANCE COST IN, 165528007 VISION PREMIUM 12/2022 979.62 Total : 979.62
206345 12/7/2022 011188 INSURANCE COMPANY, THE LINCOLN 4478526339 LTD PREMIUM 12/2022 4,610.14 Total : 4,610.14
206346 12/7/2022 013712 LA CHANCLA MEXICAN GRILL,INC 201 COMMUNITY ACTIVITY EXPENSE 1,240.31 Total : 1,240.31
206347 12/7/2022 013487 TRUSAIC CINV-025699 PROF & CONTRACTUAL SERVICE 500.00 Total : 500.00
206348 12/7/2022 013473 CONTROLLING INSURANCE COST IN, Ben148880 VISION : PAYMENT 540.48 Ben149186 VISION: PAYMENT 540.48
Page: 9
City Council Regular Meeting - Page 24 of 1385
vchlist Prepaid-Check List Page: 10
12/14/2022 3:58:00PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206348 12/7/2022 013473 CONTROLLING INSURANCE COST IN, (Continued) Ben149219 VISION: PAYMENT 22.52
Total: 1,103.48
206349 12/7/2022 000078 ODP BUSINESS SOLUTIONS,LLC 279758545001 05-001940 OPERATING OFFICE SUPPLIES 485.88 Total: 485.88
206350 12/7/2022 000150 ADDICTION MEDICINE CONSULTANTS 12M24 05-001943 RANDOM PULL DRUG SCREEN 1,470.00 Total: 1,470.00
206351 12/7/2022 000486 LIBERTY UTILITIES 158555-12222 06-009582 WATER USE FOR IRRIGATION 115.38 164055-12222 06-009582 WATER USE FOR IRRIGATION 25.49
164060-12222 06-009582 WATER USE FOR IRRIGATION 25.49
Total : 166.36
206352 12/7/2022 005582 MATTEL SALES CORP 005582-121522 COMMUNITY ACTIVITY EXPENSE 2,325.00 Total : 2,325.00
206353 12/7/2022 002044 SUPERIOR WAREHOUSE 002044-121522 COMMUNITY ACTIVITY EXPENSE 4,000.00 Total : 4,000.00
206354 12/12/2022 004640 DEPT. OF INDUSTRIAL RELATIONS E 1926031 MR MISCELLANEIOUS EXPENSE 225.00 Total: 225.00
206355 12/12/2022 001987 DISTRICT OF SOUTHERN CALIF., WATER 001987-103122 06-009617 GROUNDWATER PRODUCTION & 160,606.47 Total : 160,606.47
206356 12/12/2022 009571 RAMON'S LINEN 02509 EMPLOYEE HOLIDAY BREAKFAST 320.00 Total: 320.00
206357 12/12/2022 013288 SPECTRUM 0543478111622 12-000411 OTHER FEE FOR SERVICE 493.15 Total : 493.15
206358 12/12/2022 013288 SPECTRUM 0031912111622 12-000411 OTHER FEE FOR SERVICE 150.06 Total : 150.06
206359 12/12/2022 013288 SPECTRUM 0603173111522 12-000411 OTHER FEE FOR SERVICE 182.72 Page: 10
,,.,--
City Council Regular Meeting - Page 25 of 1385
vchlist Prepaid-Check List Page: 11
12/14/2022 3:58:00PM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206359 12/12/2022 013288 013288 SPECTRUM (Continued) Total : 182.72 206360 12/12/2022 013288 SPECTRUM 0244895110122 12-000411 OTHER FEE FOR SERVICE 367.99 0244895120122 12-000411 OTHER FEE FOR SERVICE 219.98
Total : 587.97
206361 12/12/2022 008668 SOLACHE, JOSE LUIS 008668-081422 REIMBURSEMENT TRAVEL 259.00 Total : 259.00
206362 12/12/2022 008668 SOLACHE, JOSE LUIS 008668-093022 ELECTRONIC/MEDIA-AUTO EXPENSES 500.00 Total: 500.00
206363 12/13/2022 001075 BOMB ENTERTAINMENT 99 COMMUNITY ACTIVITY EXPENSE 850.00 Total: 850.00
206364 12/13/2022 013718 CHURRO BOSS LLC 013718-121522 EMPLOYEE HOLIDAY EVENT 1,708.88 Total: 1,708.88
206365 12/13/2022 002319 CINDY'S JUMPERS 58467 COMMUNITY ACTIVITY EXPENSE 446.00 Total : 446.00
206366 12/13/2022 013696 ITS FOAM TIME LLC 9323700 COMMUNITY ACTIVITY EXPENSE 1,700.00 Total: 1,700.00
206367 12/13/2022 013619 TOYOTA FINANCIAL SERVICES 001 7362931-120622 01-001722 AUTO EXPENSE 777.65 Total: 777.65
206368 12/13/2022 013608 AMAYA, ANYSSA 013608-2022 08-004976 MR & MISS LYNWOOD 600.00 Total: 600.00
206369 12/13/2022 001046 BAVCO 164400 06-009185 BACKFLOW 2,204.78 Total: 2,204.78
206370 12/13/2022 000300 BUBBS HARDWARE 237 06-009599 OPERATING SUPPLIES 11.05 238 06-009599 OPERATING SUPPLIES 13.36
Total : 24.41
206371 12/13/2022 001479 DAVE BANG ASSOC,. INC. CA52074 08-004926 REPAIR/ REPLACE PLAYGROUND 6,432.59 Page: 11
City Council Regular Meeting - Page 26 of 1385
vchlist Prepaid-Check List Page: 12
12/14/2022 3:58:00PM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206371 12/13/2022 001479 001479 DAVE BANG ASSOC, . INC. (Continued) Total: 6,432.59 206372 12/13/2022 012692 SOTO, RITA 012692-083122 ELECTRONIC/MEDIA-AUTO EXPENSES 500.00 Total: 500.00
206373 12/14/2022 005344 AT&T MOBILITY 287260367753X110822 12-000416 CELL PHONE SERVICE 3,077.33 Total: 3,077.33
206374 12/14/2022 013105 CALIFORNIA STREET LIGHTING 929 06-009791 PROF & CONTRACTUAL SERVICE 45,000.00 Total: 45,000.00
206375 12/14/2022 007782 CAMACHO , GABRIELA 007782-123122 ELECTRONIC/MEDIA-AUTO EXPENSES 500.00 Total: 500.00
206376 12/14/2022 001087 FANTASY FLOWERS AND GIFTS 2406 01 -001743 FLOWER SERVICES 275.63 2417 01-001743 FLOWER SERVICES 540.23
Total : 815.86
206377 12/14/2022 009571 RAMON'S LINEN 02510 LINEN SERVICES 220.00 Total : 220.00
206378 12/14/2022 001364 ROMERO, DIANA 001364-120122 REIMBURSEMENT 544.11 Total : 544.11
206379 12/14/2022 002386 T-MOBILE USA, INC 983463843-112122 12-000422 TELEPHONE SERVICE 286.80 Total: 286.80
206380 12/14/2022 001552 CARRILLO, ROSALIA 416174220 REIMB-CAR RENTAL CHRISTMAS 136.10 416174242 REIMB-CAR RENTAL CHRISTMAS 156.90
416174253 REIMB-CAR RENTAL CHRISTMAS 156.90
416174356 REIMB-CAR RENTAL CHRISTMAS 156.90
416174371 REI MB-CAR RENTAL CHRISTMAS 136.10
416174415 REIMB-CAR RENTAL CHRISTMAS 136.10
Total : 879.00
206381 12/14/2022 013715 TAMALERIA LA DONA 120922 COMMUNITY ACTIVITY EXPENSE 800.00 Total : 800.00
Page: 12
City Council Regular Meeting - Page 27 of 1385
vchlist
12/14/2022
Bank code:

Voucher
3:58:00PM
apbank
Date Vendor
66 Vouchers for bank code :
66 Vouchers in this report
apbank
Prepaid-Check List
City of Lynwood
Invoice PO# Description/Account
-------
Bank total :

Total vouchers :

Page: 13
Amount
631,627.83
631,627.83
Page: 13
City Council Regular Meeting - Page 28 of 1385
vchlist Check List Page: 14
12/15/2022 11:33:45AM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206382 12/20/2022 001994 ALIN'S PARTY SUPPLY CO. 647981 08-005041 SUPPLIES FOR CITY SPECIAL 159.51 648221 08-005041 SUPPLIES FOR CITY SPECIAL 88.11
648344 08-005041 SUPPLIES FOR CITY SPECIAL 264 .34
Total : 511.96
206383 12/20/2022 011719 ALL STAR ELITE SPORTS 3181 08-005067 SHIRTS FORSTAFF AND PROGRAM 3,588 .64 3206 08-005067 SHIRTS FOR STAFF AND PROGRAM 804.83
Total: 4,393.47
206384 12/20/2022 010746 ALVAREZ-GLASMAN & COLVIN 2022-09-20500-3 02-002622 LEGAL SERVICES 1,366.00 Total : 1,366.00
206385 12/20/2022 008217 AMAZON .COM, LLC 435748938759 12-000423 COMPUTER AND NElWORKING 112.59 438377499843 12-000423 COMPUTER AND NElWORKING 225 .31
463497447578 12-000423 COMPUTER AND NElWORKING 39.66
557339556674 12-000423 COMPUTER AND NElWORKING 77.16
593667576876 12-000423 COMPUTER AND NElWORKING 97.67
733345366764 12-000423 COMPUTER AND NElWORKING 77.16
999658688595 12-000423 COMPUTER AND NElWORKING 108.59
Total: 738.14
206386 12/20/2022 002452 AMERICAN LANGUAGE SVCS . 71747 01-001732 TRANSLATION SERVICES 492.40 Total : 492.40
206387 12/20/2022 006170 BARTEL ASSOCIATES, LLC 22-771 02-002650 CONSUL TING SERVICES 16,760.00 Total : 16,760.00
206388 12/20/2022 000884 BLUE DIAMOND MATERIALS 3008004 06-009648 OPERATING SUPPLIES - (HOT MIX, 1,878 .17 Total : 1,878.17
206389 12/20/2022 006014 CA BLDG .STANDARDS COMMISSION 006014-063022 BUILDING PERMIT FEE 426.00 Total : 426.00
206390 12/20/2022 013700 CAMPOS, FATIMA 013700-103122 08-005065 PROF & CONTRACTURAL SERVICE 480.00 013700-113022 08-005065 PROF & CONTRACTURAL SERVICE 624 .00 Total : 1,104.00
Page : 14
City Council Regular Meeting - Page 29 of 1385
vchlist Check List Page: 15
12/15/2022 11:33:45AM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206391 12/20/2022 013245 CARLO MAGNO 863856 AUTO EXPENSE 440 .00 Total: 440.00
206392 12/20/2022 012555 CASAMAR GROUP,LLC 13282-F 06-009420 PROF & CONTRACTURAL SERVICE 1,801 .25 Total: 1,801.25
206393 12/20/2022 009302 CHESSER, CHRISTINE 10222022 BARTENDAR SERVICES 250 .00 12032022 BARTENDAR SERVICES 300.00
Total: 550.00
206394 12/20/2022 002319 CINDY'S JUMPERS 57397 08-005047 COMMUNTITY ACTIVITIES EXPENSE 380.00 Total: 380.00
206395 12/20/2022 001571 CLINICAL LAB OF SAN BERNARDINO 2201719-L YN01 06-009602 PROF & CONTRACTURAL SERVICE 1,925.00 Total : 1,925.00
206396 12/20/2022 012021 CONCENTRA MEDICAL CENTERS 77109613 PRE-EMPLOYMENT PHSICALS 171.00 77191739 PRE-EMPLOYMENT PHSICALS 171.00
77350481 PRE-EMPLOYMENT PHSICALS 102.50
77430153 PRE-EMPLOYMENT PHSICALS 71 .50
Total : 516.00
206397 12/20/2022 010754 COOL IMAGE WATER, OBA/ AMERICAN 1727 06-009645 OTHER FEES FOR SERVICES 188.50 1728 08-004995 OTHER FEES FOR SERVICES 36.63
1730 11-002152 OTHER FEES FOR SERVICES 165.23
1732 02-002629 OTHER FEES FOR SERVICES 29.00
1733 08-004995 OTHER FEES FOR SERVICES 42.85
1734 08-004995 OTHER FEES FOR SERVICES 26.71
1736 08-004995 OTHER FEES FOR SERVICES 29.38
Total : 518.30
206398 12/20/2022 000027 COUNTY CLERK , 23-2015 03-000442 ELECTION SERVICES 120,924.98 23-4014 03-000442 ELECTION SERVICES 3,803.05
Total : 124,728.03
206399 12/20/2022 010638 COURT OF CALIFORNIA, COUNTY OF LA 740A-103122 11-002163 PARKING CITATIONS AND BAIL 20,304 .00 Total: 20,304.00
Page : 15
City Council Regular Meeting - Page 30 of 1385
vchlist Check List Page: 16
12/15/2022 11:33:45AM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206400 12/20/2022 000138 DAILY JOURNAL CORPORATION B3648679 11-002137 PUBLICATION SERVICES 530.00 B3649091 11-002137 PUBLICATION SERVICES 688.09
Total : 1,218.09
206401 12/20/2022 013714 DAVIS, RITA BRIGHT 17485190 REFUND-BATEMAN HALL RENTAL 150.00 Total : 150.00
206402 12/20/2022 013639 EL PORTAL A TU BIENESTAR INC 610 01-001755 COMMUNITY ACTIVITIES EXPENSE 7,500.00 Total : 7,500.00
206403 12/20/2022 001087 FANTASY FLOWERS AND GIFTS 5570 08-005011 COMMUNITY ACTIVITIES EXPENSE 441.00 5600 08-005011 COMMUNITY ACTIVITIES EXPENSE 292.17
Total : 733.17
206404 12/20/2022 001393 FERGUSON ENTERPRISES, INC. 2038178 06-009577 MATERIALS AND SUPPLIES 258.33 Total: 258.33
206405 12/20/2022 004425 FUN EXPRESS. LLC 719899479-01 08-005035 COMMUNITY ACTIVITES EXPENSE 178.58 Total: 178.58
206406 12/20/2022 003983 GALLS QUARTERMASTER BC1750396 11-002139 PUBLIC SAFETY OFFICER 1,274.62 Total : 1,274.62
206407 12/20/2022 013694 GLOBAL URBAN STRATEGIES, INC 221 01-001765 PROF & CONTRACTUAL SERVICE 4,207.50 252 01-001765 PROF & CONTRACTUAL SERVICE 1,085.00
261 01-001765 PROF & CONTRACTUAL SERVICE 3,670.00
268 01-001765 PROF & CONTRACTUAL SERVICE 6,000.00
Total : 14,962.50
206408 12/20/2022 005304 GOLDEN BELL PRODUCTS INC. 18109 06-009758 PROF & CONTRACTUAL SERVICE 17,722.50 Total : 17,722.50
206409 12/20/2022 001510 GRAINGER, INC. 9506065755 06-009578 OPERATING SUPPLIES 26.01 9506065755-A 06-009783 OPERATING SUPPLIES 481.83
9527814983 06-009578 OPERATING SUPPLIES 439.38
Total : 947.22
206410 12/20/2022 009832 HARDING, ELIZABETH B. 009832-113022 08-005019 PROF& Page: 16
City Council Regular Meeting - Page 31 of 1385
vchlist Check List Page: 17
12/15/2022 11:33:45AM City of Lynwood
Bank code : apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206410 12/20/2022 009832 009832 HARDING, ELIZABETH B. (Continued) Total : 170.00 206411 12/20/2022 013321 HERNANDEZ , ERNIE 013321-103122 ELECTRONIC/MEDIA ALLOWANCE 800 .00 Total : 800.00
206412 12/20/2022 003338 HILLYARD -LOS ANGELES 604953328 06-00965 1 OPERATING SUPPLIES 629 .39 Total : 629.39
206413 12/20/2022 000676 IDEAL LIGHTING SUPPLY, INC. 122657 06-009580 ELECTRICAL SUPPLIES 164.60 Total : 164.60
206414 12/20/2022 013191 IKREAT 20220906 06-009760 PROF & CONTRACTUAL SERVICE 2,370.00 Total : 2,370.00
206415 12/20/2022 005848 INFRASTRUCTURE ENGINEERS 28110 11-002159 PROF & CONTRACTUAL SERVICE 9,088.46 28121 11-002159 PROF & CONTRACTUAL SERVICE 8,788 .00
Total : 17,876.46
206416 12/20/2022 000844 J & G GRAPHICS 05612 06-009699 PRINTING SERVICES 3.35 05612-A 06-009784 PRINTING SERVICES 93.12
Total : 96.47
206417 12/20/2022 008254 JCL TRAFFIC SERVICES 117335 06-009652 OPERATING SUPPLIES 1,363 .04 Total : 1,363.04
206418 12/20/2022 005054 JJ KELLER & ASSOCIATES , INC. 9107482312 PROF & CONTRACTUAL SERVICE 995 .00 Total : 995.00
206419 12/20/2022 013434 KILEY & ASSOCIATES ,LLC 15 01-001745 LOBBYING SERVICES 5,000 .00 Total: 5,000.00
206420 12/20/2022 000001 KING FENCE, INC 46588 08-004997 FENCE RENTAL 42.50 Total : 42.50
206421 12/20/2022 003331 L.A. COUNTY SHERIFF DEPT . 231101LL 01-001727 LAW ENFORCEMENT SERVICE 967,346 .52 231102LL 01-001728 LAW ENFORCEMENT SERVICE 21,071 .60
231141LL 01-001729 LAW ENFORCEMENT SERVICE 4,654 .21
231223LL 01-001729 LAW ENFORCEMENT SERVICE 9,932.46
Page: 17
City Council Regular Meeting - Page 32 of 1385
vchlist Check List Page: 18
12/15/2022 11:33:45AM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206421 12/20/2022 003331 003331 L.A. COUNTY SHERIFF DEPT. (Continued) Total: 1,003,004.79 206422 12/20/2022 003313 LOS ANGELES METROPOLITAN, 6017928 02-002616 BUS PASS SUBSIDY 340.00 Total: 340.00
206423 12/20/2022 000348 LYNWOOD ATHLETICS COMMUNITY QTR-2-OCT 2022 11-002144 LAW ENFORCEMENT SERVICE 7,337 .17 Total: 7,337.17
206424 12/20/2022 002761 MARCO POWER EQUIPMENT 21215005 06-009672 AUTO EXPENSE 61.74 21215008 06-009672 AUTO EXPENSE 315.64
Total: 377.38
206425 12/20/2022 002683 MAY TOOL INC. 198026 06-009674 OPERATING SUPPLIES 233.90 Total : 233.90
206426 12/20/2022 013681 MEZA'S HVAC 194 06-009779 AUTO EXPENSE 1,450.00 Total: 1,450.00
206427 12/20/2022 013504 MINER, LTD 5310551118 06-009676 REPAIRS/MAINT -BLDG & EQUIP 1,185.31 Total: 1,185.31
206428 12/20/2022 005256 MONJARAS & WISMEYER GROUP,INC. 22560 05-001936 PROF & CONTRACTUAL SERVICE 180.00 Total: 180.00
206429 12/20/2022 009647 MV CHENG & ASSOCIATES, INC. 11/30/2022 02-002631 PROF & CONTRACTUAL SERVICE 14,930.00 Total: 14,930.00
206430 12/20/2022 004111 NATIONAL CONSTRUCTION RENTALS 6788408 06-009395 RENTAL EQUIPMENT 267.12 Total: 267.12
206431 12/20/2022 000475 NATIONWIDE ENVIRONMENTAL SVCS . 32782 06-009653 PROF & CONTRACTUAL SERVICE 49,399 .15 32856 06-009653 PROF & CONTRACTUAL SERVICE 49,399 .15
Total: 98,798.30
206432 12/20/2022 000475 NATIONWIDE ENVIRONMENTAL SVCS. 32782-A 11-002160 PROF & CONTRACTUAL SERVICE 4,885.63 32784 06-009605 PROF & CONTRACTUAL SERVICE 47,793.09
32784-A 11-002160 PROF & CONTRACTUAL SERVICE 5,310.34
32856-A 11-002160 PROF & CONTRACTUAL SERVICE 4,885.63
Page : 18
City Council Regular Meeting - Page 33 of 1385
vchlist
12/15/2022 11:33:45AM
Bank code : apbank
Voucher Date Vendor
Check List
City of Lynwood
Invoice
206432 12/20/2022 000475 000475 NATIONWIDE ENVIRONMENTAL (Continued) 206433 12/20/2022 011922 NORTH STAR LAND CARE LLC 1601.456 1601-437
1601-441
1601-442
1601-443
1601-450
1601-451
206434 12/20/2022 000078 ODP BUSINESS SOLUTIONS,LLC 253344568001 279247898001
282272240001
206435 12/20/2022 013552 ODP BUSINESS SOLUTIONS,LLC 253433782001 256286727001
206436 12/20/2022 012886 OLEA, GULLERMINA 0702-0012
206437 12/20/2022 005562 ORKIN PEST CONTROL 235599689
206438 12/20/2022 012548 PARKING COMPANY OF AMERICA NVM0017133 206439 12/20/2022 004854 PETTY CASH- FINANCE 004854-121222 206440 12/20/2022 013717 PGS HOME AND SOLAR 9919
206441 12/20/2022 008307 PHOENIX GROUP INFORMATION SYS 1020221204 102022204
102022902
Page: 19
PO# Description/Account Amount
Total: 62,874.69
06-009620 PROF & CONTRACTUAL SERVICE 4,280.00
06-009620 PROF & CONTRACTUAL SERVICE 20,400.00
06-009620 PROF & CONTRACTUAL SERVICE 8,264.00
06-009620 PROF & CONTRACTUAL SERVICE 2,160.00
06-009620 PROF & CONTRACTUAL SERVICE 30,598.00
06-009620 PROF & CONTRACTUAL SERVICE 27,933.00
06-009620 PROF & CONTRACTUAL SERVICE 10,677.00
Total: 104,312.00
08-005023 OFFICE SUPPLIES 474.05
06-009661 OFFICE SUPPLIES 502.25
02-002643 OFFICE SUPPLIES 187.49
Total : 1,163.79
11-002200 OFFICE SUPPLIES 539.11
11-002200 OFFICE SUPPLIES 246.87
Total: 785.98
REFUND-CANCELLED BATEMAN HALL 800.00
Total: 800.00
08-005008 PEST CONTROL 140.00
Total : 140.00
06-009642 PROF & CONTRACTUAL SERVICE 102,372.27
Total : 102,372.27
REPLENISH PETTY CASH BOX 353.74
Total : 353.74
REFUND-BUILDING PERMIT 343.96
Total: 343.96
11-002154 PROF & CONTRACTUAL SERVICE 2,484.05
11-002154 PROF & CONTRACTUAL SERVICE 34,994.86
11-002154 PROF & CONTRACTUAL SERVICE 350.00
Page: 19
City Council Regular Meeting - Page 34 of 1385
vchlist Check List Page: 20
12/15/2022 11:33:45AM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206441 12/20/2022 008307 008307 PHOENIX GROUP INFORMATION (Continued) Total : 37,828.91 206442 12/20/2022 006281 PROFESSIONAL SECURITY, IN000122493 06-009607 PROF & CONTRACTUAL SERVICE 1,210.97 Total : 1,210.97
206443 12/20/2022 010206 QUALITY PRINTING SERVICES 26816 ADVERTISING & PRINTING 91.59 Total: 91.59
206444 12/20/2022 001057 RAMIREZ, JUAN E. 221031 03-000440 INTERPRETER SERVICES 930.00 221116 03-000440 INTERPRETER SERVICES 930.00
Total : 1,860.00
206445 12/20/2022 009571 RAMON'S LINEN 02494 08-005005 PROF & CONTRACTUAL SERVICE 40.00 02495 08-005005 PROF & CONTRACTUAL SERVICE 100.00
02511 08-005005 PROF & CONTRACTUAL SERVICE 240.00
Total : 380.00
206446 12/20/2022 005067 ROADLINE 18068 06-009789 OPERATING SUPPLIES 1,157.63 Total: 1,157.63
206447 12/20/2022 013713 ROMERO, JESSICA 16277813 REFUND-BATEMAN HALL RENTAL 116.74 Total: 116.74
206448 12/20/2022 000519 S&S WORLDWIDE IN101108754 08-005053 OPERATING SUPPLIES 1,101.68 IN101108754-A 08-005053 OPERATING SUPPLIES 337.44
IN101109733 08-005053 OPERATING SUPPLIES 86.42
Total : 1,525.54
206449 12/20/2022 007205 SANCHEZ AWARDS 2109 AWARDS PURCHASE 498.33 Total : 498.33
206450 12/20/2022 012688 SANTIAGO, DANIEL 1094-0015 REFUND-BATEMAN HALL RENTAL 1,151.00 Total : 1,151.00
206451 12/20/2022 002727 SCPMA-HR 05597 MEMBERSHIP 50.00 05628 MEMBERSHIP 50.00
Total : 100.00
Page: 20
City Council Regular Meeting - Page 35 of 1385
vchlist Check List Page: 21
12/15/2022 11:33:45AM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount 206452 12/20/2022 013372 SECTRAN SECURITY INC 22070497 02-002617 ARMORED TRUCK SERVICES 443.12 22080500 02-002617 ARMORED TRUCK SERVICES 439.72
22090505 02-002617 ARMORED TRUCK SERVICES 434.61
22100508 02-002617 ARMORED TRUCK SERVICES 436.31
22110513 02-002617 ARMORED TRUCK SERVICES 438.02
Total: 2,191.78
206453 12/20/2022 012311 SPECIAL SERVICE FOR GROUPS, IN 012311-093022 11-002156 CDBG-CV HOMELESS OUTREACH 4,089.98 Total: 4,089.98
206454 12/20/2022 000929 SWARCO MCCAIN,INC INV0269734 06-009675 PROF & CONTRACTUAL SERVICE 7,153.03 Total: 7,153.03
206455 12/20/2022 002938 TAJ OFFICE SUPPLY 02150 11-002201 OFFICE SUPPLIES 781.86 02281 11-002201 OFFICE SUPPLIES 53.98
02300 11-002201 OFFICE SUPPLIES 45.15
02329 08-005060 OFFICE SUPPLIES 122.38
02399 08-005066 OFFICE SUPPLIES 980.12
Total : 1,983.49
206456 12/20/2022 013701 TAYLOR, LASHONDA 013701-113022 PROF & CONTRACTUAL SERVICE 260.00 Total : 260.00
206457 12/20/2022 013215 THE HOME DEPOT PRO SUPPLY WORK 718546963 06-009629 MATERIALS & SUPPLIES 168.00 718778582 06-009629 MATERIALS & SUPPLIES 217.64
718782642 06-009629 MATERIALS & SUPPLIES 438.80
718968977 06-009629 MATERIALS & SUPPLIES 502.18
718969116 06-009629 MATERIALS & SUPPLIES 593.23
719259830 06-009629 MATERIALS & SUPPLIES 338.78
719274466 06-009629 MATERIALS & SUPPLIES 110.22
719276016 06-009629 MATERIALS & SUPPLIES 78.67
Total : 2,447.52
206458 12/20/2022 000166 UNDERGROUND SERVICE ALERT/SC 1120220424 06-009593 UNDERGROUND SERVICE ALERT 230.50 18dsbfee304 06-009593 UNDERGROUND SERVICE ALERT 104.00
18dsbfee912 06-009593 UNDERGROUND SERVICE ALERT 104.00
22-2301863 06-009593 UNDERGROUND SERVICE ALERT 110.90
Page: 21
City Council Regular Meeting - Page 36 of 1385
vchlist Check List Page: 22
12/15/2022 3:46:38PM City of Lynwood
Bank code: apbank
Voucher Date Vendor Invoice PO# Description/Account Amount --
206458 12/20/2022 000166 000166 UNDERGROUND SERVICE ALERT/SC (Continued) Total : 549.40 206459 12/20/2022 009742 UNIFIRST CORPORATION 3242816535 06-009621 UNIFORM SERVICE 56.49 3242816536 06-009621 UNIFORM SERVICE 56.22
3242816537 06-009621 UNIFORM SERVICE 93.36
3242816538 06-009621 UNIFORM SERVICE 151.83
3242816539 06-009621 UNIFORM SERVICE 92.04
Total : 449.94
206460 12/20/2022 000461 UNITED RENTALS, INC. 207574341-001 08-005014 RENTAL EQUIPMENT 414.44 Total: 414.44
206461 12/20/2022 002912 WATERLINE TECHNOLOGIES,INC 5612576 06-009610 OPERATING SUPPLIES 666.90 5613149 06-009610 OPERATING SUPPLIES 289.96
5613150 06-009610 OPERATING SUPPLIES 811.88
Total: 1,768.74
206462 12/20/2022 009100 WATERWORKS TECHNOLOGY,INC . 6923 06-009622 PROF & CONTRACTUAL SERVICES 34,700.00 Total : 34,700.00
206463 12/20/2022 007811 WELLS FARGO BANK 2164858 ADMINISTRATION FEE 1,500.00 Total : 1,500.00
206464 12/20/2022 000102 WHITE CAP, HD SUPPLY CONST.& 50020287869 06-009711 OPERATING SUPPLIES 511.38 Total: 511.38
206465 12/20/2022 000181 WHITTIER FERTILIZER COMPANY 393315 06-009712 OPERATING SUPPLIES 749.70 Total : 749.70
206466 12/20/2022 000057 WILLDAN ENGINEERING 00417933 06-009524 PROF & CONTRACTUAL SERVICES 34,509.50 Total : 34,509.50
206467 12/20/2022 012137 XIO INC. 20122374 06-009790 PROF & CONTRACTUAL SERVICES 3,121.62 20122445 06-009790 PROF & CONTRACTUAL SERVICES 792.97
Total : 3,914.59
206468 12/20/2022 013367 TANNER LLC SIN030826 01-001769 PROF & CONTRACTUAL SERVICES 4,500.00 SIN032001 01-001769 PROF & CONTRACTUAL SERVICES 4,250.00 --
Page: 22
City Council Regular Meeting - Page 37 of 1385
vchlist
12/15/2022
Bank code :

Voucher
206468
206469
206470
3:46:38PM
apbank
Date Vendor
12/20/2022 013367 013367 TANNER LLC
12/20/2022 007860 THE PUN GROUP, LLP
12/20/2022 007609 WILLDAN FINANCIAL SERVICES
89 Vouchers for bank code : apbank
Check List
City of Lynwood
Invoice
(Continued)
113629
010-53165
PO# ----- --
02-002652
02-002653
Description/Account
Total :

PROF & CONTRACTUAL SERVICES
Total :

Bank total :

Page: 23
Amount
8,750.00
14,776.50
14,776.50
1,125.00
1,125.00
1,822,301.29
Page: 23
City Council Regular Meeting - Page 38 of 1385
RESOLUTION NO. 2022.XXX

Warrant Registers Dated 12-20-2022

PASSED, APPROVED and ADOPTED this 20th day of December_, 2022.

Oscar Flores, Mayor

ATTEST:

__________________________
Maria Quiňonez, Ernie Hernandez,
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

________
Noel Tapia, Harry Wong,
City Attorney Director of Finance and Administration

City Council Regular Meeting - Page 39 of 1385

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, Maria Quinonez, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of Lynwood at a meeting held on the 20th day of December, 2022.

AYES: COUNCIL MEMBERS MUNOZ, SOLACHE, MAYOR PRO TEM SOTO AND

MAYOR FLORES

NOES: NONE

ABSENT: NONE

ABSTAIN: NONE

________________________
Maria Quiňonez,
City Clerk

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, Maria Quinonez, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true and correct copy of Resolution No. 2022.XXX on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this _20th day of December_, 2022.

___________________________
Maria Quiňonez,
City Clerk

City Council Regular Meeting - Page 40 of 1385
Agenda Item # 10.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Sheila Harding, Deputy City Treasurer
SUBJECT: TREASURER'S MONTHLY INVESTMENT REPORT
Recommendation:

The following is the Investment Report for the month ending November 30, 2022. This report is provided to ensureCity Council is informed of the Department’s investment activities. The report satisfies the recommendedreporting requirements of the City of Lynwood, which addresses the City Council’s request for monthly financialinformation. It is recommended that the City Council for the City of Lynwood receive and file the attached Monthly InvestmentReport.

Background:

Government Code Section 53607, last amended 1996, with reference to the reporting of investment transactionsstates that the Treasurer shall make a monthly report of those transaction to the legislative body. GovernmentCode Section 53646 (b) (1), last amended 2004, with reference to discussion related to establishment of anInvestment Policy and investment reporting states that “the Treasurer may render a quarterly report”. To determinethe applicable code inasmuch as reference to Government Code Section 53607 or non-compliance thereof hasnever been included in past audit findings. While Government Code Section 53646 (b) (1) which is the mostcurrent version related to Investment Reporting utilizes the word “may” indicating the reporting mechanism isoptional, to err on the side of caution, and in order to ensure that we are in compliance with all Government Codes,a new procedure of submitting monthly reports to the Council/Agency agenda was implemented. Attached forCouncil/Agency review is the City’s/Agency’s Monthly Treasurer’s Report.

Discussion and Analysis:

The investment transactions were executed in accordance with the City's Investment Policy and the CaliforniaState Government Code Section 53646(b)(3) that requires the general fund is able to meet its expenditurerequirements for the next six months.

City Council Regular Meeting - Page 41 of 1385

Fiscal Impact:

The action recommended in this report will not have a fiscal impact on the City.

Coordinated With:

FHN Financial Main Street Advisors currently monitors the City’s investment activities.

ATTACHMENTS:Description
ACTIVITY & SUMMARY REPORT - NOVEMBER 2022
CNBC ECONOMIC REPORT - NOVEMBER 2022
FHN ECONOMIC REPORT - NOVEMBER 2022
City Council Regular Meeting - Page 42 of 1385

ACTIVITY & PERFORMANCE SUMMARY
NOVEMBER 2022

1 The following is the City’s cash flow and the monthly investment report. The monthly report includes a summary of the City’s investment portfolio, a monthly review of the investment market as prepared by the investment managers and detailed information on monthly transactions, cash flows and investments by issuer.

FHN Investment Advisors manage the portion of investments not invested by LAIF (State Local Agency Investment Fund).

The tables below provide key statistics regarding the City’s cash flow and investment portfolio as of November 30, 2022.

Type Balances Held
Cash - US Bank $45,764,544.11
Cash - JPMorgan Chase Bank $7,977,966.31
Local Agency Investment Fund $9,595,678.13
FHN Investment Advisors/BNY $25,718,384.70
TOTAL $89,056,573.25

FHN ACCOUNT SUMMARY
30-Nov 31-Oct
Market Value $35,314,063 $35,094,932
Book Value $36,466,189 $36,421,280
Variance ($1,152,126) ($1,326,348)
Par Value $36,492,754 $36,455,459
Net Asset Value $96.84 $96.36
Book Yield 2.35% 2.23%
Market Yield 3.88% 3.89%
Years to Maturity 1.75 1.74
Effective Duration 1.45 1.49

FHN INVESTMENT COMPLIANCE
% %
Company Book Value of
Portfolio
of
Total
US Treasuries 6,499,739.57 17.82% 100%
US Federal Agencies 10,447,960.11 28.65% 100%
Supranational Obligations $0.00 0% 30%
LAIF 9,595,678.13 26.31% 75%
Commercial Paper 1,473,614.48 4.04% 25%
Money Market Funds 45,076.33 0.12% 20%
Negotiable Certificates of Deposit 4,915,536.83 13.48% 30% Corporate Obligations 3,488,583.58 9.57% 30%
State and Local Governments $0.00 0% 100%
City Council Regular Meeting - Page 43 of 1385

ACTIVITY & PERFORMANCE SUMMARY
NOVEMBER 2022

2 All of the City’s rated investments were rated “A” or higher by at least two rating agencies on November 2022.

The City’s investments comply with its current investment policy, which emphasizes the safety, liquidity, and return of its investments, allowing the city to meet its expenditures for the next six months.

PURCHASES & MATURITIES

PURCHASE(S)

SETTLEMENT

DATE NAME TRANSACTION

TYPE ISSUER PAR VALUE MARKET

VALUE RATING
30-Nov-22 FHLMC Purchase US Agency 500,000.00 501,190.00 Aaa/AA+

REDEMPTION(S)

MATURITY

DATE NAME TRANSACTION

TYPE ISSUER REDEMPTION COUPON

RATE INTEREST
11-Nov-22 Credit Agricole,
NY Maturity Comm. Paper 500,000.00 0.00% 0

FHN INCOME EARNED SUMMARY

November
Month End
Fiscal Year to
Date

INTEREST
Interest Received/Purchased. 37,295.62 184,424.19
Plus Accrued Interest at End of Period 124,829.88 124,829.88 Less Accrued Interest at Beginning of Period -116,217.39 -74,680.06 Interest Earned During Period 45,908.11 234,574.01

Total Adjustments for Amortization/Accretion 7,613.54 17,545.24 Total Capital Gains or Losses 0.00 0.00
Total Earnings During Period 53,521.65 252,119.25
City Council Regular Meeting - Page 44 of 1385
CNBC – NOVEMBER 2022

KEY POINTS
 Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%, the Labor Department reported Friday.
 The payrolls number was well above the 200,000 estimate, while the unemployment rate was in line.
 Average hourly earnings jumped 0.6% for the month, double the estimate, and 5.1% annually versus the 4.6% expectation.

Job growth was much better than expected in November despite the Federal Reserve’s aggressive efforts to slow the labor market and tackle inflation.

Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%, the Labor Department reported Friday. Economists surveyed by Dow Jones had been looking for an increase of 200,000 on the payrolls number and 3.7% for the jobless rate.

The monthly gain was a slight decrease from October’s upwardly revised 284,000. A broader measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons edged lower to 6.7%.

The numbers likely will do little to slow a Fed that has been raising interest rates steadily this year to bring down inflation still running near its highest level in more than 40 years. The rate increases have brought the Fed’s benchmark overnight borrowing rate to a target range of 3.75%-4%.

In another blow to the Fed’s anti -inflation efforts, average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis; also well above the 4.6% expectation.

The Dow Jones Industrial Average fell as much as 350 points after the report on worries the hot jobs data could make the Fed even more aggressive. However, stocks shaved most of their losses as the trading session neared its close. Treasury yields initially jumped on the jobs news before turning mixed later.

Leisure and hospitality led the job gains, adding 88,000 positions.

Other sector gainers included health care (45,000), government (42,000) and other services, a category that includes personal and laundry services and which showed a total gain of 24,000. Social assistance saw a rise of 23,000, which the Labor Department said brings the sector back to where it was in February 2020 before the Covid pandemic.

Construction added 20,000 positions, while information was up 19,000 and manufac turing saw a gain of 14,000.

On the downside, retail establishments reported a loss of 30,000 positions heading into what is expected to be a busy holiday shopping season. Transportation and warehousing also saw a decline, down 15,000.

The numbers come as the Fed has raised rates half a dozen times this year, including four consecutive

0.75 percentage point increases.

City Council Regular Meeting - Page 45 of 1385
CNBC – NOVEMBER 2022

Despite the moves, job gains had been running strong this year if a bit lower than the rapid pace of 2021.

On monthly basis, payrolls have be en up an average of 392,000 against 562,000 for 2021. Demand for labor continues to outstrip supply, with about 1.7 positions open for every available worker.

Fed Chairman Jerome Powell earlier this week said the job gains are “far in excess of the pace needed to accommodate population growth over time” and said wage pressures are contributing to inflation. “To be clear, strong wage growth is a good thing. But for wage growth to be sustainable, it needs to be consistent with 2 percent inflation,” he said during a speech Wednesday in Washington, D.C.

Markets expect the Fed to raise its benchmark interest rate by 0.5 percentage point when it meets later this month. That is likely to be followed by a few more increases in 2023 before the central bank can pause to see how its policy moves are impacting the economy, according to current market pricing and statements from several central bank officials.

Friday’s numbers had little impact on rate expectations, with traders assigning a nearly 80% probability that the Fed would step down to a half-point increase, according to CME Group data.

Powell has stressed the importance of getting labor force participation back to its pre -pandemic level.

However, the November reports showed that participation fell one-tenth of a percentage point to 62.1%, tied for the lowest level of the year as the labor force fell by 186,000 and is now slightly below the February 2020 level.

City Council Regular Meeting - Page 46 of 1385
Monthly Economic and Market Update
November 2022
City Council Regular Meeting - Page 47 of 1385
Economic and Market Update
*Estimates for the current quarter/month, some data are lagged Sources: FHN Main Street and Bloomberg 11/30/2022
Item 11/30/2022 10/31/2022 Change
U.S. Payrolls Monthly Change 263,000 284,000 (21,000)
Unemployment Rate 3.7% 3.7% 0.0%
Labor Force Participation 62.1% 62.2% (0.1%)
Effective Fed Funds Rate 3.83% 3.08% 0.75%
2 Year T-Note 4.31% 4.49% (0.17%)
3 Month T-Bill 4.35% 4.07% 0.28%
3 Year T-Note 4.05% 4.44% (0.39%)
5 Year T-Note 3.74% 4.23% (0.49%)
10 Year T-Note 3.61% 4.05% (0.44%)
U.S. Fed Debt Avg Yield* 2.20% 2.10% 0.10%
30 Year Mortgage Rate 6.67% 5.83% 0.84%
1-5 Yr Agency Spread 0.11% 0.08% 0.03%
1-5 Yr A-AAA Corporate Spread 0.62% 0.83% (0.21%)
Dow Jones 34,590 32,733 5.7%
S&P 500 4,080 3,872 5.4%
Consumer Price Index YOY* 7.8% 7.7% 0.1%
U.S. Avg Regular Unleaded $3.47 $3.76 ($0.29)
Retail Sales YOY* 7.7% 8.3% (0.6%)
Case-Shiller Home Prices YOY* 10.4% 13.1% (2.6%)
Consumer Confidence 100.2 102.2 (2.0)
Gold (per ounce) $1,768.52 $1,633.56 $134.96
Dollar Index 105.95 111.53 (5.58)
2 City Council Regular Meeting - Page 48 of 1385
Economic and Market Update
* Real Rate (Inflation Adjusted)
Source: Bureau of Economic Analysis
Estimate: Bloomberg's Survey of Economists
As of: 11/30/2022
11/30/2022
-1.4

5.2 4.7

1.8 3.3

2.3 1.3

0.6 2.4

1.2 2.4

2.0 1.7

2.0 3.4

4.1 2.8

2.8 2.9

0.7 2.2

2.7 3.6

1.8 -4.6
-29.9

35.3 3.9

6.3 7.0

2.7 7.0
-1.6
-0.6

2.9 0.5

0.0 -0.1

0.6 -45
-35
-25
-15
-5
5 15
25 35
45 Q1 2014
Q2 2014
Q3 2014
Q4 2014
Q1 2015
Q2 2015
Q3 2015
Q4 2015
Q1 2016
Q2 2016
Q3 2016
Q4 2016
Q1 2017
Q2 2017
Q3 2017
Q4 2017
Q1 2018
Q2 2018
Q3 2018
Q4 2018
Q1 2019
Q2 2019
Q3 2019
Q4 2019
Q1 2020
Q2 2020
Q3 2020
Q4 2020
Q1 2021
Q2 2021
Q3 2021
Q4 2021
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Q1 2023
Q2 2023
Q3 2023
Percent
U.S. GDP (Quarter over Quarter Annualized)*
Estimates
3 City Council Regular Meeting - Page 49 of 1385
Economic and Market Update
Source: Bureau of Labor Statistics
12 Month Average Job Change 408,000
11/30/2022
-22
-20
-18
-16
-14
-12
-10
-8
-6
-4
-2
0 2
4 6
May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Nov-22
Millions
U.S. Monthly Non-Farm Payrolls Change
-25.0
-20.0
-15.0
-10.0
-5.0

0.0 5.0

10.0 15.0

20.0 May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Nov-22
Millions
U.S. Monthly Non-Farm Payrolls YOY Change
4 City Council Regular Meeting - Page 50 of 1385
Economic and Market Update
Source: Bureau of Labor Statistics
11/30/2022
0 5
10 15
20 25
30 May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Jan-21
Mar-21
May-21
Jul-21
Sep-21
Nov-21
Jan-22
Mar-22
May-22
Jul-22
Sep-22
Nov-22
Percent
Unemployment Rates
U.S.A Nevada California Idaho Washington Hawaii Oregon Utah 5 City Council Regular Meeting - Page 51 of 1385
Economic and Market Update
Source: Bureau of Labor Statistics
11/30/2022
128
130
132
134
136
138
140
142
144
146
148
150
152
154
156
Nov-12
Jun-13
Jan-14
Aug-14
Mar-15
Oct-15
May-16
Dec-16
Jul-17
Feb-18
Sep-18
Apr-19
Nov-19
Jun-20
Jan-21
Aug-21
Mar-22
Oct-22
Millions
U.S. Number of Employed
Full-Time and Part-Time

60.0 60.5

61.0 61.5

62.0 62.5

63.0 63.5

64.0 Nov-12
Jun-13
Jan-14
Aug-14
Mar-15
Oct-15
May-16
Dec-16
Jul-17
Feb-18
Sep-18
Apr-19
Nov-19
Jun-20
Jan-21
Aug-21
Mar-22
Oct-22
Percent
U.S. Labor Force Participation Rate
6 City Council Regular Meeting - Page 52 of 1385
Economic and Market Update
Source: Department of Labor and Bloomberg
11/30/2022
Weekly Initial Jobless Claims is the actual number of people who have filed for Unemployment benefits for the first time. The following five eligibility criteria must be met in order to file for unemployment benefits: 1. Meet the requirements of time worked during a 1 year period (full time or not). 2. Become unemployed through no fault of your own (cannot be fired). 3. Must be able to work; no physical or mental holdbacks. 4. Must be available for work. 5. Must be actively seeking work.

0.0 0.5

1.0 1.5

2.0 2.5

3.0 3.5

4.0 4.5

5.0 5.5

6.0 1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Millions
Weekly Initial Jobless Claims
(4 Week Moving Average)
7 City Council Regular Meeting - Page 53 of 1385
Economic and Market Update
*Real: Inflation Adjusted
Source: U.S. Census Bureau Source: Conference Board
11/30/2022
-30
-20
-10
0 10
20 30
40 50
60 May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Percent
U.S. Real* Retail Sales YOY % Change
40 50
60 70
80 90
100
110
120
130
140
May-12
Nov-12
May-13
Nov-13
May-14
Nov-14
May-15
Nov-15
May-16
Nov-16
May-17
Nov-17
May-18
Nov-18
May-19
Nov-19
May-20
Nov-20
May-21
Nov-21
May-22
Nov-22
Index Value
U.S. Consumer Confidence
8 City Council Regular Meeting - Page 54 of 1385
Economic and Market Update
CPIX: Consumer Price Index, excluding food and energy PCEC: Personal Consumption Expenditure Core Source: Bureau of Labor Statistics and Bureau of Economic Analysis 11/30/2022

0.0 1.0

2.0 3.0

4.0 5.0

6.0 7.0

8.0 9.0

10.0 May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Percent
CPI and CPIX YOY % Change
CPI
CPIX

0.0 1.0

2.0 3.0

4.0 5.0

6.0 7.0

8.0 May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Percent
PCE and PCEC YOY % Change
PCE
PCEC
9 City Council Regular Meeting - Page 55 of 1385
Economic and Market Update
Sources: New (U.S. Census Bureau),Existing (National Assoc. of Realtors) Source: Case-Shiller Seasonally Adjusted Annual Rate
11/30/2022
0 2
4 6
8 10
12 14
16 18
20 22
24 Jun-14
Nov-14
Apr-15
Sep-15
Feb-16
Jul-16
Dec-16
May-17
Oct-17
Mar-18
Aug-18
Jan-19
Jun-19
Nov-19
Apr-20
Sep-20
Feb-21
Jul-21
Dec-21
May-22
YOY Percent
Case-Shiller 20 City U.S. Home Price Index
YOY % Increase
200
300
400
500
600
700
800
900
1,000
1,100

3.0 3.5

4.0 4.5

5.0 5.5

6.0 6.5

7.0 May-14
Nov-14
May-15
Nov-15
May-16
Nov-16
May-17
Nov-17
May-18
Nov-18
May-19
Nov-19
May-20
Nov-20
May-21
Nov-21
May-22
New-Thousands
Existing-Millions
U.S. New and Existing Home Sales
Existing-Left
New-Right
10 City Council Regular Meeting - Page 56 of 1385
Economic and Market Update
Source: U.S. Treasury
11/30/2022
$12
$13
$14
$15
$16
$17
$18
$19
$20
$21
$22
$23
$24
$25
$26
$27
$28
$29
$30
$31
$32
$33
Nov-12
May-13
Nov-13
May-14
Nov-14
May-15
Nov-15
May-16
Nov-16
May-17
Nov-17
May-18
Nov-18
May-19
Nov-19
May-20
Nov-20
May-21
Nov-21
May-22
Trillions
U.S. Federal Debt Outstanding

1.3 1.5

1.7 1.9

2.1 2.3

2.5 2.7
Nov-12
May-13
Nov-13
May-14
Nov-14
May-15
Nov-15
May-16
Nov-16
May-17
Nov-17
May-18
Nov-18
May-19
Nov-19
May-20
Nov-20
May-21
Nov-21
May-22
Percent
U.S. Treasury Interest Bearing Debt Avg Rate
11 City Council Regular Meeting - Page 57 of 1385
Economic and Market Update
Fed Funds Anticipated Rate from the September 21, 2022 FOMC Meeting Source: Bloomberg
11/30/2022

2.00 2.50

3.00 3.50

4.00 4.50

5.00 5.50
Dec-2022
Jan-2023
Feb-2023
Mar-2023
Apr-2023
May-2023
Jun-2023
Jul-2023
Aug-2023
Sep-2023
Oct-2023
Nov-2023
Dec-2023
Jan-2024
Feb-2024
Mar-2024
Apr-2024
May-2024
Jun-2024
Jul-2024
Aug-2024
Sep-2024
Oct-2024
Nov-2024
Dec-2024
Jan-2025
Feb-2025
Mar-2025
Apr-2025
May-2025
Jun-2025
Jul-2025
Aug-2025
Sep-2025
Oct-2025
Nov-2025
Dec-2025
Jan-2026
Percent
Fed Funds FuturesFed's Anticipated Rates
Fed Funds Futures
12 City Council Regular Meeting - Page 58 of 1385
Economic and Market Update
Source: Bloomberg
Figures may not total due to rounding
3M
Maturity
-0.174.494.312Y

0.084.644.711Y

0.144.544.686M

0.284.074.35

3.61 4.05 -0.44
Change10/31/2211/30/22
11/30/2022
3Y 4.05 4.44 -0.39
30Y 3.74 4.17 -0.43
5Y 3.74 4.23 -0.49
10Y

0.0 0.5

1.0 1.5

2.0 2.5

3.0 3.5

4.0 4.5

5.0 3M 6M 1Y 2Y 3Yr 5Y 10Y 30Y
Percent
U.S. Treasury Yield Curve Change
11/30/22
10/31/22
-60
-50
-40
-30
-20
-10
0 10
20 30
40 3M
6M
1Y
2Y
3Yr
5Y
10Y
30Y
Basis Points
Basis Point Change
13 City Council Regular Meeting - Page 59 of 1385
Economic and Market Update
Source: Bloomberg
11/30/2022

0.00 0.25

0.50 0.75

1.00 1.25

1.50 1.75

2.00 2.25

2.50 2.75

3.00 3.25

3.50 3.75

4.00 4.25

4.50 4.75

5.00 Nov-17
Feb-18
May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Nov-22
Percent
U.S. Treasury Yields: 3M and 1Y
1Y
3M

0.00 0.25

0.50 0.75

1.00 1.25

1.50 1.75

2.00 2.25

2.50 2.75

3.00 3.25

3.50 3.75

4.00 4.25

4.50 4.75
Nov-17
Feb-18
May-18
Aug-18
Nov-18
Feb-19
May-19
Aug-19
Nov-19
Feb-20
May-20
Aug-20
Nov-20
Feb-21
May-21
Aug-21
Nov-21
Feb-22
May-22
Aug-22
Nov-22
Percent
U.S. Treasury Yields: 2Y and 5Y
5Y
2Y
14 City Council Regular Meeting - Page 60 of 1385
Economic and Market Update
Source: Bloomberg
11/30/2022
0 1
2 3
4 5
6 7
8 9
10 11
12 13
14 15
16 17
18 19
20 21
Jan-54
Jan-56
Jan-58
Jan-60
Jan-62
Jan-64
Jan-66
Jan-68
Jan-70
Jan-72
Jan-74
Jan-76
Jan-78
Jan-80
Jan-82
Jan-84
Jan-86
Jan-88
Jan-90
Jan-92
Jan-94
Jan-96
Jan-98
Jan-00
Jan-02
Jan-04
Jan-06
Jan-08
Jan-10
Jan-12
Jan-14
Jan-16
Jan-18
Jan-20
Jan-22
Percent
U.S. Treasury Yields 2Yr and 5Yr - Fed Funds Target Rate 5Yr
2Yr
Fed Funds
15 City Council Regular Meeting - Page 61 of 1385
Economic and Market Update
Source: Bloomberg
11/30/2022
Global Treasury Rates
2 Year Yields 5 Year Yields 10 Year Yields
-0.03%

0.83%

2.11%

2.14%

2.20%

2.37%

2.66%

3.11%

3.26%

3.87%

4.31%
-2.0% 0.0% 2.0% 4.0%
Japan
Switzlnd
Germany
Portugal
France
Spain
Italy
Australia
England
Canada
USA

0.11%

0.94%

1.93%

2.21%

2.31%

2.50%

3.16%

3.25%

3.28%

3.35%

3.74%
-1.0% 1.0% 3.0% 5.0%
Japan
Switzlnd
Germany
France
Portugal
Spain
Canada
England
Australia
Italy
USA

0.25%

1.08%

1.93%

2.40%

2.87%

2.94%

3.16%

3.53%

3.61%

3.87%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0%
Japan
Switzlnd
Germany
France
Portugal
Canada
Spain
England
Australia
USA
Italy
16 City Council Regular Meeting - Page 62 of 1385
Economic and Market Update
ICE BofAML Index (option adjusted spread vs. Treasury) ICE BofAML Index (option adjusted spread vs. Treasury) 1-5Yr Non-Callable Agency (GVPB) Corporate A-AAA Excluding Yankee (CVAC) Source: ICE BofAML Indices
11/30/2022
Current Spread is 11 Current Spread is 62
-20
0 20
40 60
80 100
120
140
160
180
200
Oct-08
Oct-09
Oct-10
Oct-11
Oct-12
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Oct-18
Oct-19
Oct-20
Oct-21
Oct-22
Basis Points
Spread: 1-5Yr Agency vs Treasury
0 50
100
150
200
250
300
350
400
450
500
550
600
650
Oct-08
Oct-09
Oct-10
Oct-11
Oct-12
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Oct-18
Oct-19
Oct-20
Oct-21
Oct-22
Basis Points
Spread: 1-5Yr A-AAA Corporate vs Treasury
17 City Council Regular Meeting - Page 63 of 1385
Economic and Market Update
*ICE BofAML Index (option adjusted spread vs. Treasury) *ICE BofAML Index (option adjusted spread vs. Treasury) AAA Rated ABS (R0A1) CMO Agency 0-3Yr PAC (CM1P)
Source: ICE BofAML Indices
11/30/2022
Current Spread is 113 Current Spread is 53
0 50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
Oct-08
Oct-09
Oct-10
Oct-11
Oct-12
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Oct-18
Oct-19
Oct-20
Oct-21
Oct-22
Basis Points
Spread: AAA Asset Backed vs Treasury
-150
-100
-50
0 50
100
150
200
250
300
Oct-08
Oct-09
Oct-10
Oct-11
Oct-12
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Oct-18
Oct-19
Oct-20
Oct-21
Oct-22
Basis Points
Spread: 0-3Yr Agency CMO vs Treasury
18 City Council Regular Meeting - Page 64 of 1385
Economic and Market Update
Source: Bloomberg
11/30/2022
-4.7
-1.8
-0.5

0.3 0.7

1.8 2.1

3.6 3.6 3.8 4.0 4.0

5.5 5.6 5.9 6.0 6.1

7.1 8.5

11.9 13.2

14.3 (10)
(5)
0 5
10 15
20 Percent
Selected Sector Monthly Total Returns
19 City Council Regular Meeting - Page 65 of 1385
Economic and Market Update
Source: Bloomberg
11/30/2022
-30.8
-25.0
-18.5 -17.6 -14.8 -14.8 -14.3 -12.6 -10.7 -9.2 -8.9 -8.4 -6.2 -5.6 -4.2 -3.4 -0.2

0.6 2.3

11.3 26.3

46.6 (40)
(30)
(20)
(10)
0 10
20 30
40 50
60 Percent
Selected Sector Year-Over-Year Total Returns
20 City Council Regular Meeting - Page 66 of 1385
Economic and Market Update
Source: Bloomberg, FHN Main Street
11/30/2022

3.60 3.70

3.80 3.90

4.00 4.10

4.20 4.30

4.40 4.50
10/31/22
11/1/22
11/2/22
11/3/22
11/4/22
11/5/22
11/6/22
11/7/22
11/8/22
11/9/22
11/10/22
11/11/22
11/12/22
11/13/22
11/14/22
11/15/22
11/16/22
11/17/22
11/18/22
11/19/22
11/20/22
11/21/22
11/22/22
11/23/22
11/24/22
11/25/22
11/26/22
11/27/22
11/28/22
11/29/22
11/30/22
Percent
5 Year Treasury Note Yield
San Francisco Fed's Daly
Says Rate Pause Is Off
The Table
Fed Hikes Rates 75bps While
Emphasizing Higher
Terminal Rate
October CPI 0.4% MoM
Core 0.3%
FOMC Minutes
Emphasize Desire To
Slow Rate Hikes Soon
Powell Says Says the
Fed May Slow Down
Pace of Rate Hikes
21 City Council Regular Meeting - Page 67 of 1385
Agenda Item # 11.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public WorksGeorge Cambero, Interim Utility Manager SUBJECT: AUTHORIZATION TO APPLY FOR URBAN COMMUNITY DROUGHT RELIEF GRANT Recommendation:

Staff recommends that the City Council adopt the following resolution entitled, “A RESOLUTION OF THE CITYCOUNCIL OF THE CITY OF LYNWOOD APPROVING THE APPLICATION FOR GRANT FUNDS FORTHE URBAN COMMUNITY DROUGHT RELIEF GRANT BY HARRIS & ASSOCIATES.” Background:

Grants are intended to provide funding to communities that face the loss or contamination of their water supplies.New wells, well rehabilitation, and associated water treatment projects are eligible. The grant application due dateis January 31, 2023 and staff will be working with Harris & Associates to provide data for Well 19 for amanganese treatment project.

Discussion and Analysis:

Well No. 19 is located at 2600 Industry Way. This water well was constructed in 1971, has a depth of 900 feet andproduces 2,000 gallons per minute. Well 19 is under a Revised Operational Plan for controlling the manganeselevel. One of the provisions for the operational plan is that whenever samples collected exceed the manganeseMaximum Contaminant Level (MCL) of 0.05 mg/L, the well will be switched to pump-to-waste until the manganeselevel goes below MCL.

The State Water Resources Control Board (SWRCB) requires a manganese study to be completed annually forWell No. 19. The SWRCB Division of Drinking Water (DDW) recommends that manganese treatment be appliedfor a long term water quality solution.

There has been Proposition 68 low interest loan documents submitted with no current pending award for the City Council Regular Meeting - Page 68 of 1385
design of the Well 19 treatment process. Efforts of the low interest loan is still being pursued but staff recommendssubmitting a scope of work and project request for grant funds with the other five cities for the Urban CommunityDrought Relief Grant by Harris & Associates.

Fiscal Impact:

The application process for the Urban Community Drought Relief Grant using Harris & Associates will be at nocost to the City. The cost for submitting and administrating the grant will be paid for through GMWA and the grant. In addition, the City has limited capital funds and needs to pursue grant funding to assist in covering some of itsrehabilitation and treatment costs associated with these particular projects that are eligible under the UrbanCommunity Drought Relief Grant. Finally, the project grant funding application may require matching local funds to stay competitive.

Coordinated With:

City Manager’s OfficeDepartment of Finance and Administration Services ATTACHMENTS:Description
12-20-22 Authorization to Apply for Grant (Resolution) Final City Council Regular Meeting - Page 69 of 1385
RESOLUTION._____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD

APPROVING THE APPLICATION FOR GRANT FUNDS FOR THE URBAN

COMMUNITY DROUGHT RELIEF GRANT BY HARRIS & ASSOCIATES

WHEREAS, Gateway Water Management Authority (GWMA) proposes to implement the GWMA Regional Groundwater Resilience Project; and

WHEREAS, Gateway Water Management Authority has the legal authority and is authorized to enter into a funding agreement with the State of California; and

WHEREAS, Gateway Water Management A uthority intends to apply for grant funding from the California Department of Water Resources for the GWMA Regional Well Resilience Project;

WHEREAS, Lynwood is one of six-member cities that have been approved by the GWMA Board to submit the UCDR grant application for wells/well treatment design/planning projects; and

WHEREAS, the City has limited capital funds and pursuing grant funding to assist the City in covering some of its rehabilitation and treatment costs associated will provide a benefit for long term water quality solutions.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER AND RESOLVE AS FOLLOWS:

Section 1 . That the City Council approves authorize the Gateway Water Management Authority to apply for the Urban Community Drought Relief Grant.

Section 2. That the City Council authorizes the City Attorney to negotiate the final form of the Agreement.

Section 3. That this Resolution shall take effect immediately upon its adoption.

Section 4. That the City Clerk shall certify to the adoption of this Resolution.

City Council Regular Meeting - Page 70 of 1385
2 PASSED, APPROVED and ADOPTED this 20th day of December 2022.

______________________________
Oscar Flores
Mayor
ATTEST:

___________________________ ______________________________ María Quiñónez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

__________________________ ______________________________ Noel Tapia Julian Lee
City Attorney Director of Public Works

City Council Regular Meeting - Page 71 of 1385
3 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of Lynwood at a regular meeting held on the 20th day of December 2022, and passed by the following votes:

AYES:

NOES:

ABSTAIN:

ABSENT:

________________________
Maria Quiñónez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true and correct copy of Resolution No. ____________ on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this 20th day of December 2022.

________________________
Maria Quiñónez, City Clerk

City Council Regular Meeting - Page 72 of 1385
Agenda Item # 12.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public Works
SUBJECT: REQUEST TO INSTALL RAIN GARDENS ON BULLIS ROAD TO ADDRESSSTORMWATER DRAINAGE Recommendation:

Staff recommends that the City Council adopt the following resolution entitled: “A RESOLUTION OF THE CITYCOUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENT WITH 316 CONSTRUCTION &ENGINEERING, INC. FOR AN AMOUNT OF $145,150 TO INSTALL THREE RAIN GARDENS PERDESIGN ON BULLIS ROAD; AND AUTHORIZING THE CITY MANAGER TO APPROVE UP TO TENPERCENT OF THE CONTRACT PRICE FOR ADDITIONAL SERVICES AS NEEDED.” Background:

After the completion of the Bullis Road Street Improvement Project in June of 2020, staff still noticed a stormwaterdrainage problem along the western side of Bullis Road between Martin Luther King Junior Boulevard and PlattAvenue. Infrastructure Engineering was engaged to create a solution for the stormwater drainage problem or waterponding.

Water ponding caused by the stormwater drainage problem creates accelerated deterioration of the current streetinfrastructure and can lead to safety issues if not addressed.

Discussion and Analysis:

On November 28, 2022, staff issued a Notification of a Job Walk for December 5, 2022 at the project locationwith a Request for Quotes to receive bids for the design upgrades due on December 12, 2022. Staff reached outto six on-call vendors via email and a reminder email of proposal acceptance. On-Call Vendor List Job Walk Response Brkich Construction X No response
JA Salazar Construction X
We’re currently booked and can’taccommodate this work in a timely City Council Regular Meeting - Page 73 of 1385
mannerPrecision Pipeline X No response
Doreck Equipment Rental X We won’t be submitting a proposal for thisproject due to its currently out of our scopeof work316 Engineering & Construction Attended Submitted BidGentry Brothers X No response Only one company arrived for the job walk, reviewed the design plans with clarification questions asked, andsubmitted a quote for requested services. Pursuant to Section 6-3.7(b)(2) of the Lynwood Municipal Code, purchases between $50,001 and $200,000 shallbe by an informal bid process and must be approved by the City Council. Staff recommends that the City Councilauthorize the City Manager to open and proceed with the award of the work to 316 Engineering & Construction,Inc. for the installation of three (3) rain gardens to mitigate for stormwater drainage problem along Bullis Roadfrom Martin Luther King Junior Boulevard to Platt Avenue.

Fiscal Impact:

The Project has an approved FY23 Budget of $659,878.00. No additional funding is needed. The table below isthe proposed construction budget and funding details. Construction contract amount $145,150.0010% Contingency $14,515.00Construction Inspection (15%) $21,772.50Project Management (10%) $14,515.00Labor Compliance & Other Cost (4.9%) $7,047.00Total Estimated Construction Cost $203,000.00 CIP Funding 4011.68.069 $659,878.00FY23 Approved Budget $659,878.00 Coordinated With:

City Manager’s OfficeDepartment of Finance and Administration Services ATTACHMENTS:Description
Resolution
Exhibit A
City Council Regular Meeting - Page 74 of 1385
RESOLUTION._____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENT WITH 316 CONSTRUCTION & ENGINEERING, INC. FOR AN AMOUNT OF $145,150 TO INSTALL THREE RAIN GARDENS PER DESIGN ON BULLIS ROAD; AND AUTHORIZING THE CITY MANAGER TO

APPROVE UP TO TEN PERCENT OF THE CONTRACT PRICE FOR

ADDITIONAL SERVICES AS NEEDED

WHEREAS, The construction on the Bullis Road Street Improvement Project was completed on June 22, 2020.; and

WHEREAS, staff conducted the final inspection on June 29, 2020 and found that all work was completed in accordance with the project plans and specifications; and

WHEREAS there is stormwater drainage problem along Bullis Road between Platt Avenue and the Lynwood Unified School District main office driveway; and

WHEREAS, water ponding caused by the stormwater drainage problem creates accelerated deterioration of the current street infrastructure and can lead to safety issues if not addressed; and

WHEREAS, on November 28, 2022 pursuant to LMC Sect ion 6-3.7(b)(2), staff issued a Notification of a Job Walk for December 5, 2022 at the project location with a Request for Quotes to receive bids for the design upgrades due on December 12, 2022; and

WHEREAS, only one company arrived for the job walk, reviewed the design plans with clarification questions asked, and submitted a quote for requested services.; and

WHEREAS, staff recommends that the City Council authorize the City Manager to open and proceed with the award of the work to 316 Engineering & Construction, Inc. for $145,150.00 for the installation of three (3) rain gardens to mitigate for stormwater drainage problem along Bullis Road from Martin Luther King Junior Boulevard to Platt Avenue.

WHEREAS, staff recommends that the City Council au thorize the City Manager to approve additional services for a not to exceed amount of 10% of the contract price.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER AND RESOLVE AS FOLLOWS:

City Council Regular Meeting - Page 75 of 1385
2 Section 1. The City Council of the City of Lynwood hereby finds and declares that the foregoing recitals are true and correct, and incorporates them herein as findings and as a substantive part of this Resolution.

Section 2. That the City Council accepts proposal from 316 Engineering & Construction, Inc. for $145,150.00 for the installation of three (3) rain gardens along Bullis Road and authorizes the Mayor to execute an agreement in a form approved by the City Attorney.

Section 3. That the project budget $659,878.

Section 4. That the City Council of the City of Lynwood authorizes the City Manager under LMC 6 -3.15(d) to exceed the specific dollar amounts or percentage limitations under LMC 6 -3.15(a) and authorizes the City Manager to approve consultant, vendor agreements, modifications , change orders or agreement amendments related to the Project up to the available Project Budget.

Section 5. That this Resolution shall take effect immediately upon its adoption.

Section 6. That the City Clerk shall certify to the adoption of this Resolution and hereafter the same shall be in full force and effect.

PASSED, APPROVED and ADOPTED this 20th day of December 2022.

______________________________
Oscar Flores
Mayor
ATTEST:

___________________________ ______________________________ María Quiñónez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

__________________________ ______________________________ Noel Tapia Julian Lee
City Attorney Director of Public Works

City Council Regular Meeting - Page 76 of 1385
3 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSTAIN:

ABSENT:

________________________
Maria Quiñónez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

________________________
Maria Quiñónez, City Clerk

City Council Regular Meeting - Page 77 of 1385
1 PROFESSIONAL SERVICES AGREEMENT

This agreement (“Agreement”) is made as of [Insert month and date] ____, [Insert Year] by and between the City of Lynwood , a municipal corporation ("City") and_______________ (“Consultant”). City and Consultant are sometimes hereinafter individually referred to as a “Party” and collectively referred to as the “Parties.”

R E C I T A L S

WHEREAS, City desires to utilize the services of Consultant as an independent contractor to [insert brief description of work] as set forth in the Scope of Services attached hereto as Exhibit A; and

WHEREAS, Consultant represents that it is fully qualified to perform such consulting services by virtue of its experience and the training, education and expertise of its principals and employees.

NOW, THEREFORE, in consideration of performance by the parties of the covenants and conditions herein contained, the parties hereto agree as follows:

1. Company's Scope of Services. The nature and scope of the specific services to be performed by Consultant are as described in Exhibit A.

2. Term of Agreement. This Agreement shall commence on [Insert month and date], [Insert year] (the “Commencement Date”) and shall remain and continue in effect until tasks described in Exhibit A are completed, but in no event later than [Insert Date], unless sooner terminated pursuant to the provisions of this Agreement.

3. Compensation.

A. City agrees to compensate Consultant for services under this Agreement in compliance with the schedule set forth in Exhibit A. Consultant shall submit proper monthly invoices in the form and manner specified by City. Each invoice shall include a monthly breakdown of all monthly services performed together with the hours spent on each service. Consultant shall maintain appropriate and necessary documentation supporting the monthly i nvoices detailing the type of service provided. It shall be available for review by the City at all reasonable times upon request.

B. Total payment to Consultant pursuant to this Agreement shall not exceed ______________________________.

C. If at the request of the City, Consultant is required to incur out of pocket expenses (including but not limited to, out-of-town travel and lodging) which are above and beyond the ordinary expenses associated with performance of this Agreement, Consultant shall be entitled to reimbursement of such expenses. Consultant shall only be reimbursed for those expenses which: (I) appear on Consultant’s monthly invoices; (II) are accompanied by a copy of the City’s written authorization for Consultant to incur such expenses; and (III) receipts documenting such expenses.

City Council Regular Meeting - Page 78 of 1385
2 4. General Terms and Conditions. The General Terms and Conditions set forth in Exhibit B are incorporated as part of this Agreement. In the event of any inconsistency between the General Terms and Conditions and any other exhibit to this Agreement, the General Terms and Conditions shall control unless it is clear from the context that both parties intend the provisions of the other exhibit(s) to control.

5. Addresses.

City of Lynwood

City of Lynwood
11330 Bullis Road
Lynwood, CA 90262
Attn: Jose Ometeotl, City Manager

Company

[Insert Selected Consulting Firm]
Attn: [Insert Contact Name]

6. Exhibits. All exhibits referred to in this Agreement are listed here and are incorporated and made part of this Agreement by this reference.

Exhibit A – Scope of Work/Services and Compensation Schedule Exhibit B – General Terms and Conditions

SIGNATURES ON FOLLOWING PAGE

IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates written below.

CITY

CITY OF LYNWOOD

By: ______________________________ ______________________ Mayor Date

CONSULTANT

[Insert Consultant Name]

City Council Regular Meeting - Page 79 of 1385
3 By: _______________________________ ________________________ [Insert Consultant Name] Date

ATTEST:

By: ______________________________ ________________________ City Clerk Date

APPROVED AS TO FORM:

By: ______________________________ ________________________ City Attorney Date

City Council Regular Meeting - Page 80 of 1385
4 EXHIBIT A

SCOPE OF WORK/SERVICES

City Council Regular Meeting - Page 81 of 1385

EXHIBIT B

GENERAL TERMS AND CONDITIONS

1. Status as Independent Contractor.

A. Consultant is, and shall at all times remain as to City, an independent contractor.

Consultant shall have no power to incur any debt, obligation, or liability on behalf of the City of Lynwood or otherwise act on behalf of Lynwood as an agent. Neither the City of Lynwood nor any of its agents shall have control over the conduct of Consultant or any of Consultant’s employees, except as set forth in this Agreement. Consultant shall not, at any time, or in any manner, represent that it or any of its agents or employees are in any manner agents or employees of the City of Lynwood.

B. Consultant agrees to pay all required taxes on amounts paid to Consultant under this Agreement, and to indemnify and hold City harmless from any and all taxes, assessments, penalties, and interests asserted against City by reason of the independent Consultant relationship created by this Agreement. In the event that City is audited by any Federal or State agency regarding the independent status of Consultant and the audit in any way fails to sustain the validity of an independent Consultant relationship between City and Consultant, then Consultant agrees to reimburse City for all costs, including accounting and attorney's fees, arising out of such audit and any appeals relating thereto.

C. Consultant shall fully comply with the workers' compensation law regarding Consultant and Consultant’s employees. Consultant further agrees to indemnify and hold City harmless from any failure of Consultant to comply with applicable w orker's compensation laws. City shall have the right to offset against the amount of any fees due to Consultant under this Agreement any amount due to City from Consultant as a result of Consultant’s failure to promptly pay to City any reimbursement or indemnification arising under this Section 1.

D. Consultant represents to the City, and City relies on Consultant’s representations, that Consultant shall serve solely in the capacity of an independent contractor to the City. Neither the City nor any of it s agents will have control over the conduct of Consultant or any of Consultant’s employees, except as otherwise set forth in the Agreement. Consultant may not, at any time or in any manner, represent that it or any of its agents or employees are in any manner agents or employees of the City. The City has no duty, obligation, or responsibility to the Consultant’s agents or employees, including the Affordable Care Act coverage requirements. Consultant is solely responsible for any tax penalties associated with the failure to offer affordable coverage to its agents and employees under the Affordable Care Act with respect to Consultant’s agents and employees. Consultant warrants and represents that the City will not be responsible and will not be held liable fo r issues related to Consultant’s status as an independent contractor, including Consultant’s failure to comply with Consultant’s duties, obligations, and responsibilities under the Affordable Care Act. Consultant further agrees to defend, indemnify, and ho ld the City harmless for any and all taxes, claims, and penalties against the City related to Consultant’s obligations under the Affordable Care Act.

City Council Regular Meeting - Page 82 of 1385

2. Standard of Performance

Consultant shall perform all work to the highest professional standards and in a manner satisfactory to the City Manager or his/her designee. No additional or different tasks or services shall be performed by Consultant other than those specified in Exhibit A.

3. Indemnification.

A. Consultant is skilled in the professional calling necessary to perform the services and duties agreed to be performed under this Agreement, and City is relying upon the skill and knowledge of Consultant to perform said services and duties.

B. City and its respective elected and appointed boards, officials, officers, agents, employees and volunteers (individually and collectively, "Indemnities") shall have no liability to Consultant or any other person for, and Consultant shall indemnify, defend, protect and hold harmless Indemnities from and against, any and all liabilities, claims, actions, causes of action, proceedings, suits, damages, judgments, liens, levies, costs and expenses of whatever nature, including reasonable attorneys' fees and disbursements (collectively "Claims"), which Indemnities may suffer or incur or to which Indemnities may become subject by reason of or arising out of any injury to or death of any person(s), damage to property, loss of use of property, economic loss or other loss occurring as a result of or allegedly caused by Consultant’s performance of or failure to perform any services under this Agreement or by the negligent or willful acts or omissions of Consultant, its agents, officers, directors, subcontractor, sub consultant or employees, committed in performing any of the services under this Agreement. Notwithstanding the foregoing, the provisions of this subsection shall not apply to Claims occurring as a result of the City’s sole negligence or willful acts or omissions.

C. Consultant agrees to obtain executed indemnity agreements with provisions identical to those set forth in this Section from each and every subcontractor, sub consultant or any other person or entity involved by, for, with or on behalf of Consultant in the performance of this Agreement. In the event Consultant fails to obtain such indemnity obligations from others as required in this Section, Consultant agrees to be fully responsible according to the terms of th is Section. Failure of the City to monitor compliance with these requirements imposes no additional obligations on City and will in no way serve as a waiver of any rights hereunder. This obligation to indemnify and defend Indemnities as set forth herein shall survive the termination of this Agreement and is in addition to any rights which City may have under the law. This indemnity is effective without reference to the existence or applicability of any insurance coverage which may have been required under this Agreement or any additional insured endorsements which may extend to City.

4. Insurance.

A. Without limiting Consultant’s indemnification of Indemnities pursuant to Section 3 of this Agreement, Consultant shall obtain and provide and maintain at its own expense during the term of this Agreement the types and amounts of insurance as described below:

City Council Regular Meeting - Page 83 of 1385

(I) Consultant shall maintain Commercial General Liability Insurance with coverage at least as broad as Insurance Services Office Commercial General Liability Form CG 00 01 in an amount not less than $2,000,000 per occurrence, $4,000,000 general aggregate, for bodily injury, personal injury, and property damage. Defense costs must be paid in addition to limits. There shall be no cross- liability exclusion for claims or suits by one insured against another. The policy must include contractual liability that has not been amended. Any endorsement restricting standard ISO “insured contract” language will not be accepted.

(II) Consultant shall maintain Business Auto Coverage on ISO Business Auto Coverage Form CA 00 01 covering bodily injury and property damage for all activities of the Consultant arising out of or in connection with Work to be performed under this Agreement, including coverage for any owned, hired, non -owned or rented vehicles, in an amount not less than $1,000,000 combined single limit for each accident.

(III) Consultant shall maintain Workers’ Compensation Insurance (Statutory Limits) and Employer’s Liability Insurance with on a state approved policy form providing statutory benefits as required by law with employer’s liability limits no less t han $1,000,000 per accident for all covered losses;

(IV) Consultant shall maintain Professional Liability or Errors and Omissions Insurance that covers the services to be performed in connection with this Agreement, in the minimum amount of $1,000,000 per claim and in the aggregate.

Any policy inception date, continuity date, or retroactive date must be before the effective date of this Agreement and Consultant agrees to maintain continuous coverage through a period no less than three (3) years after comp letion of the services required by this Agreement.

B. City, its officers, officials, employees, and volunteers shall be named as additional insureds on the policy(ies) as to commercial general liability and automotive liability.

C. All insurance polici es shall be issued by an insurance company currently authorized by the Insurance Commissioner to transact business of insurance or is on the List of Approved Surplus Line Insurers in the State of California, with an assigned policyholders’ Rating of A- (or higher) and Financial Size Category Class VI (or larger) in accordance with the latest edition of Best’s Key Rating Guide, unless otherwise approved by the City’s Risk Manager.

D. All insurance policies shall provide that the insurance coverage shall not be non- renewed, canceled, reduced, or otherwise modified (except through the addition of additional insureds to the policy) by the insurance carrier without the insurance carrier giving City thirty (30) days' prior written notice thereof. Any such thirty (30) day notice shall be submitted to CITY via certified mail, return receipt requested, addressed to “Director of Human Resources & Risk Management,” City of Lynwood, 11330 Bullis Road, Lynwood, California, 90262. Consultant agrees that it will not cancel, reduce, or otherwise modify said insurance coverage.

City Council Regular Meeting - Page 84 of 1385

E. Consultant shall submit to City (I) insurance certificates indicating compliance with the minimum worker's compensation insurance requirements above, and (II) insurance policy endorsements indicating compliance with all other minimum insurance requirements above, not less than one (1) day prior to beginning of performance under this Agreement.

Endorsements shall be executed on City’s appropriate standard forms entitled "Additional Insured Endorsement".

F. Consultant’s insurance shall be primary as respects the City, its officers, officials, employees, and volunteers. Any insurance or self -insurance maintained by the City, its officers, officials, employees and volunteers shall be excess of Consultant’s insurance and shall not contribute with it.

G. Consultant agrees that if it does not keep the aforesaid insurance in full force and effect, and such insurance is available at a reasonable cost. City may take out the necessary insurance and pay the premium thereon, and the repayment thereof shall be deemed an obligation of Consultant’s and the cost of such insurance may be deducted, at the option of City, from payments due Consultant.

5. Release of Information/Confidentiality.

A. Consultant in the course of its duties may have access to confidential data of City, private individuals, or employees of the City. Consultant covenants that all data, documents, discussion, or other information developed or received by Consultant or provided for performance of this Agreement are deemed confidential and shall not be disclosed by Consultant without written authorization by City. City shall grant such authorization if disclosure is required by law. All City data shall be returned to City upon the termination of this Agreement. Consultant, its officers, employees, agents, or subconsultants, shall not without written authorization from the City Manager, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories, or other information concerning the work performed under this Agreement or relating to any project or property located within the City. Response to a subpoena or court order shall not be considered "voluntary" provided Consultant gives City notice of such court order or subpoena. Consultant’s covenant under this section shall survive the termination of this Agreement.

B. Consultant shall promptly notify City should Consultant, its officers, employees, agents, or subconsultants be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions, or other discovery request, court order, or subpoena from any person or party regarding this Agreement and the work performed thereunder. City retains the right, but has no obligation, to represent Consultant and/or be present at any deposition, hearing, or similar proceeding. Consultant agrees to cooperate fully with City and to provide the opportunity to review any response to discovery requests provided by Consultant. However, City's right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response

6. Ownership of Work Product.

A. Consultant shall maintain complete and accurate records with respect to City Council Regular Meeting - Page 85 of 1385

sales, costs, expenses, receipts, and other such information required by the City that relate to the performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be maintained in accordance with accepted accounting principles and shall be clearly identified and readily accessible. Consultant shall provide free access to the representatives of the City or its designees at reasonable times to such books and records; shall give the City the right to examine and audit said books and records; shall permit the City to make transcripts therefrom as necessary; and shall allow inspection of all work, data, documents, proceedings, and activities related to this Agreement. Such records, together with supporting documents, shall be maintained for a period of three (3) years after receipt of final payment.

B. Upon completion of, or in the event of termination or suspension of this Agreement, all original documents, designs, drawings, maps, models, computer files, surveys, notes, and other documents prepared in the course of providing the services to be performed pursuant to this Agreement shall become the sole property of the City and may be used, reused, or otherwise disposed of by the City without the permission of t he Consultant. With respect to computer files, Consultant shall make available to the City, at the Consultant's office and upon reasonable written request by the City, the necessary computer software and hardware for purposes of accessing, compiling, transferring, and printing computer files.

7. Conflict of Interest.

A. Consultant covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which may be affected by the services to be performed by Consultant under t his Agreement, or which would conflict in any manner with the performance of its services hereunder. Consultant further covenants that, in performance of this Agreement, no person having any such interest shall be employed by it. Furthermore, Consultant shall avoid the appearance of having any interest which would conflict in any manner with the performance of its services pursuant to this Agreement.

B. Consultant covenants not to give or receive any compensation, monetary or otherwise, to or from the ultimate vendor(s) of services to City as a result of the performance of this Agreement, or the services that may be procured by the City as a result of the recommendations made by Consultant’s covenants under this section shall survive the termination of this Agreement.

8. Termination. Notwithstanding any other provision, this Agreement may be duly terminated at any time by the City at its sole discretion with or without cause by serving upon the consultant at least ten (10) days prior written notice ( “Notice of Termination”).

Upon receipt of said notice, the Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise. Unless expressly agreed upon in writing by the City, the City shall not be obligated to pay for any services rendered nor any costs or expenses paid or incurred after the date of termination. The effective date of termination shall be upon the date specified in the written Notice of Termination. Consultant agrees that in the event of such termination, Consultant must refund the City its prorated share, except for services satisfactorily rendered prior to the effective date of termination. Immediately City Council Regular Meeting - Page 86 of 1385

upon receiving written Notice of Termination, Consultant shall discontinue performing services, preserve the product of the services and upon payment for services, turn over to City the product of the services in accordance with written instructions of City.

In the event this Agreement is terminated pursuant to this Section, the City shall pay to Consultant the actual value of the work performed up to the time of termination, provided that the work performed is of value to the City. Upon termination of the Agreement pursuant to this Section, the Consultant will submit an invoice to the City.

9. Personnel. Consultant represents that it has, or will secure at its own expense, all personnel required to perform the services under this Agreement. All of the services required under this Agreement will be performed by Consultant or under its supervision, and all personnel engaged in the work shall be qualified to perform such services. Consultant reserves the right to determine the assignment of its own employees to the performance of Consultant’s services under this Agreement, but City reserves the right, for good cause, to require Consultant to exclude any employee from performing services on City's premises.

10. Non-Discrimination and Equal Employment Opportunity.

A. Consultant shall not discriminate as to race, color, creed, religion, sex, marital status, national origin, ancestry, age, physical or mental handicap, medical condition, or sexual orientation, in the performance of its services and duties pursuant to this Agreement and will comply with all rules and regulations of City relating thereto. Such nondiscrimination shall include but not be limited to the following: employment, upgrading, demotion, transfers, recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship.

B. Consultant will, in all solicitations or advertisements for employees placed by or on behalf of Consultant state either that it is an eq ual opportunity employer or that all qualified applicants will receive consideration for employment without regard to race, color, creed, religion, sex, marital status, national origin, ancestry, age, physical or mental handicap, medical condition, or sexual orientation.

C. Consultant will cause the foregoing provisions to be inserted in all subcontracts for any work covered by this Agreement except contracts or subcontracts for standard commercial supplies or raw materials.

11. Assignment. Consultant shall not assign or transfer any interest in this Agreement nor the performance of any of Consultant obligations hereunder, without the prior written consent of City, and any attempt by Consultant to assign this Agreement or any rights, duties, or obligations arising hereunder shall be void and of no effect.

12. Performance Evaluation. For any Agreement in effect for twelve months or longer, the City Manager may require a written annual administrative performance evaluation within ninety (90) days of the first anniversary of the effective date of this Agreement, and each year thereafter throughout the term of this Agreement. The work product required by this Agreement shall be utilized as the basis for review, and any comments or complaints received by City during the review period, either orally or in writing, shall be considered.

City Council Regular Meeting - Page 87 of 1385

City shall meet with Consultant prior to preparing the written report. If any noncompliance with the Agreement is found, City may direct Consultant to correct the inadequacies, or, in the alternative, may terminate this Agreement as provided herein.

13. Compliance with Laws. Consultant shall keep itself informed of State, Federal and Local laws, ordinances, codes and regulations which in any manner affect those employed by it or in any way affect the performance of its service pursuant to this Agreement.

Consultant shall at all times comply with such laws, ordinances, codes and regulations. The City, its officers and employees shall not be liable at law or in equity occasioned by failure of Consultant to comply with this Section.

14. Licenses. At all times during the term of this Agreement, Consultant shall have in full force and effect all licenses (including a City business license) required of it by law for performance of the services hereunder.

15. Non-Waiver of Terms, Rights and Remedies. Waiver by either party of any one or more of the conditions of performance under this Agreement shall not be a waiver of any other condition of performance under this Agreement. In no event shall the making by City of any payment to Consultant constitute or be construed as a waiver by City of any breach of covenant, or any default which may then exist on the part of Consultant, and the making of any such payment by City shall in no w ay impair or prejudice any right or remedy available to City with regard to such breach or default.

16. Attorney's Fees. In the event that either party to this Agreement shall commence any legal or equitable action or proceeding to enforce or interpret t he provisions of this Agreement, the prevailing party in such action or proceeding shall be entitled to recover its costs of suit, including reasonable attorney's fees and costs, including costs of expert witnesses and Consultant.

17. Notices. Any notices, bills, invoices, or reports required by this Agreement shall be deemed received on (a) the day of delivery if delivered by hand during Consultant regular business hours or by facsimile before or during Consultant regular business hours; or (b) on the third business day following deposit in the United States mail, postage prepaid, to the addresses heretofore set forth in the Agreement, or to such other addresses as the parties may, from time to time, designate in writing pursuant to the provisions of this section.

18. Governing Law. This Agreement shall be construed and interpreted both as to validity and to performance of the Parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California. However, the Parties may agree to submit any dispute to non -binding arbitration.

19. Counterparts. This Agreement may be e xecuted in any number of counterparts, each of which shall be deemed to be the original, and all of which together shall constitute one and the same instrument.

20. Severability. If any provision or any part of any provision of this Agreement is found City Council Regular Meeting - Page 88 of 1385

to be invalid or unenforceable, the balance of this Agreement shall remain in full force and effect.

21. Entire Agreement. This Agreement, and any other documents incorporated herein by specific reference, represents the entire and integrated agreement between Consultant and City. This Agreement supersedes all prior oral or written negotiations, representations or agreements. This Agreement may not be amended, nor any provision or breach hereof waived, except in a writing signed by the Parties which expressly refers to this Agreement.

Amendments on behalf of the City will only be valid if signed by the Mayor and attested by the City Clerk.

22. Authority. The person or persons executing this Agreement on behalf of Consultant warrants and represents that he/she has the authority to execute this Agreement on behalf of Consultant and has the authority to bind Consultant to the performance of its obligations hereunder.

23. Force Majeure. A Party’s performance of any obligation under this Agreement shall be suspended if, and to the extent that, the Party is unable to perform because of any event of Force Majeure. In any such event, the Party unable to perform shall be required to resume performance of its obligations under this Agreement upon the termination o f the event or cause that excused performance hereunder. “Force Majeure” herein means an event which is beyond the reasonable control of a Party, including without limitation, (a) acts of God including flood, fire, earthquake, hurricane or explosion, pande mic; (b) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (c) government order or law that prevents either Party from performing its obligations as set forth in this Agreement; (d) actions, embargoes or blockades in effect on or after the date of this Agreement; (e) action by any governmental authority that prevents either Party from performing its obligations as set forth in this Agreement; (f) national or regional emergency; (g) strikes, labor stoppages or slowdowns or other industrial disturbances, other than those involving the affected parties employees; (h) shortage of adequate power or transportation facilities.

Neither Party shall be liable for any delay or default in, or failure of, performance resulting from or arising out of any Force Majeure event, and no such delay, default in, or failure of performance shall constitute a breach by either Party hereunder. Where a Force Majeure event gives rise to a failure or delay in either P arty performing its obligations under this Agreement (other than obligations to make payment), those obligations will be suspended for the duration of the Force Majeure event. A Party who becomes aware of a Force Majeure event which gives rise to, or whic h is likely to give rise to, any failure or delay in performing its obligations under this Agreement, will forthwith notify the other and inform the other of the period for which it is estimated that such failure or delay will continue. The affected Party shall take reasonable steps to mitigate the effects of the Force Majeure event.

City Council Regular Meeting - Page 89 of 1385
Agenda Item # 13.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public Works
SUBJECT: FERNWOOD AVENUE PARK PROJECT CHANGE ORDER LIMIT INCREASEAPPROVAL Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “FERNWOOD AVENUE PARKPROJECT CHANGE ORDER LIMIT INCREASE APPROVAL.” Background:

The Fernwood Avenue Park Project consists of the renovation of vacant land into public city park, includingwalking trail, pedestrian bridge, new landscaping, seating areas, public right away improvements and customplayground to decrease impermeable surfaces and runoff, and enhance opportunities for stormwater infiltrationmanagement. The Project will include educational component on water saving techniques as well as stormwaterrunoff reduction. Project also include off-site improvements. On October 12, 2021, the City of Lynwood Public Works Department issued a Notice Inviting Bids for theconstruction of the Fernwood Avenue Park Project – RMC Grant (CIP 4011.68.037). On February 1, 2022,California Landscape and Design, Inc. was awarded the contract for the project at a bid of $2,385,294.70. A Notice to Proceed was issued to California Landscape and Design, Inc. on July 11, 2022, and construction ofthe Fernwood Avenue Park commenced.

Discussion and Analysis:

Due to various unforeseen circumstances throughout the project, change orders have been issued increasing thecost of the contract. The approved change orders are as follows:

City Council Regular Meeting - Page 90 of 1385
Approved Change OrdersChange OrderNumber Change Order Description Change OrderAmount AdditionalWorking Days CCO #1 Additional Asphalt and BaseMaterial Removal $68,837.40 15 CCO #2 Import Fill at Asphalt andAggregate Base Removal $92,009.00 12 CCO #3 Disposal of Existing SCEBollards $1,083.21 0
CCO #4 Additional Cost for Mobilization,Maintaining Traffic Control, &Dust Control $12,643.70 8 CCO #5 Grind Asphalt 5” Thick andResurface with Asphalt 5” $75,877.49 5 CCO #6 Delays due to Arsenic in Soil $6,972.01 0
CCO #7 Laboratory Fees (SoilSamples) $2,381.19 0
CCO # 8 Chipping Concrete AroundExisting TS Pole and AdjustExisting Pull Box $2,476.90 0 CCO # 9 Delays Due to AC and SoilTests $5,213.61 4
Deletion of Bid Item No. 51 (Construct ConcreteCurb and Gutter) $23,688.50 0 Deletion of Bid Item #16 (Over Excavate, Removeand Scarify Overall Site, Average Depth 6”) $50,850.00 0 TOTAL APPROVED CHANGE ORDERS $192,956.01 # Of AdditionalWorkingDays: 44 Total amount of $192,956.01 or 8.1% of the original bid amount has been approved up to date for the changeorders. In addition to the above-mentioned change orders, the contractor is requesting approval for additional changeorder in amount of $164,616.20 for contaminant removal (arsenic) using soil abatement methods. After review of the contract documents, the public works department is requesting the total change order limit to beincreased to 20% of the original construction contract ($477,059.00). This authorization will cover the change orderrequest due to contaminant removal (arsenic) using soil abatement methods and future potential change orders toguarantee fewer delays and lessen the cost in the completion of the Fernwood Avenue Park Project. Projected Construction Cost and Approved Budget: As part of the 5-Year CIP plan, a budget of $3,671,259.00 including funding from the Water Fund, RMC Grant,General Fund, Lease Revenue Bond, Measure R Fund and Safe Clean Water Fund was approved by the CityCouncil on February 1, 2022 for the Fernwood Avenue Park Project. With the additional change orders, theproject will still be within the approved budget. The table below is the proposed revised construction budget and additional appropriation need. Construction contract amount $2,385,294.7020% Contingency $477,059.00Construction Inspection (15%) $357,794.00Project Management (10%) $238,529.00Labor Compliance & Other Cost (8.5%) $202,750.00Revised Total Estimated Construction Cost $3,661,426.70 City Council Regular Meeting - Page 91 of 1385
General Fund $38,649.00Measure R $691,818.00RMC Grant Fund $1,615,674.00Measure W/SCWP $107,150.002017 Lease Revenue Bond $929,194.00Water Fund $288,774.00FY23 Approved Budget $3,671,259.00

Fiscal Impact:

The Project has an approved FY23 Budget of $3,671,259.00. No additional funding is needed.

Coordinated With:

City Manager's OfficeDepartment of Finance and Administration Services ATTACHMENTS:Description
Resolution
City Council Regular Meeting - Page 92 of 1385
1 RESOLUTION.________
_____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD ACCEPTING THE

FERNWOOD AVENUE PARK PROJECT CHANGE ORDER LIMIT INCREASE APPROVAL.

WHEREAS, as part of the 5-Year CIP plan, a budget of $3,671,259.00 including funding from the Water Fund, RMC Grant, General Fund, Lease Revenue Bond, Measure R Fund and Safe Clean Water Fund was approved by the City Council on February 1, 2022 for the Fernwood Avenue Park Project; and

WHEREAS, the Project consists of the renovation of vacant land into public city park, including walking trail, pedestrian bridge, new landscaping, seating areas, public right away improvements and custom playground to decrease impermeable surfa ces and runoff, and enhance opportunities for stormwater infiltration management. The Project will include educational component on water saving techniques as well as stormwater runoff reduction. Project also include off-site improvements.; and

WHEREAS, California Landscape and Design, Inc. was awarded the contract for the project at a bid of $2,385,294.70 on February 1, 2022; and

WHEREAS, due to various unforeseen circumstances throughout the project , the total amount of $192,956.01 or 8.1% of the original bid amount has been approved up to date for the change orders; and

WHEREAS, the contractor requested approval for additional change order in amount of $164,616.20 for contaminant removal (arsenic) using soil abatement methods; and

WHEREAS, the Fernwood Avenue Park Project will remain within budget and no additional funding is needed; and

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER, AND RESOLVE AS FOLLOWS:

Section 1. That the City Council of the City of Lynwood approves the increase of set change order limit to 20% of the original construction contract or $477,059.00 for the Fernwood Ave Park Project.

Section 2. That the City Council of the City of Lynwood authorizes the City Manager under LMC 6-3.14(d) to exceed the specific dollar amounts or percentage limitations under LMC 6-3.14(a) and authorizes the City Manager to approve the change orders related to the Project up to the available Project Budget.

Section 3. That the project budget remains at $3,671,259.00.

Section 4. That this Resolution shall take effect immediately upon its adoption.

City Council Regular Meeting - Page 93 of 1385
2 Section 5. The City Clerk shall certify to the adoption of this Resolution and hereafter the same shall be in full force and effect.

(Signatures on Next Page)
City Council Regular Meeting - Page 94 of 1385
3 PASSED, APPROVED and ADOPTED this 20th day of December 2022.

Oscar Flores
Mayor

ATTEST:

Maria Quinonez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

Noel Tapia Julian Lee
City Attorney Director of Public Works
City Council Regular Meeting - Page 95 of 1385
4 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSTAIN:

ABSENT:

Maria Quinonez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Clerk of the City Council of said City, do hereby certify that the above foregoing is a full, true, and correct copy of Resolution No. on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this 20th day of December 2022.

Maria Quinonez, City Clerk
City Council Regular Meeting - Page 96 of 1385
Agenda Item # 14.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public Works
SUBJECT: CIP PRIORITY 2 STREET IMPROVEMENT PROJECT (PHASE 2A) FY 2022-2023CHANGE ORDER APPROVAL Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTION OF THE CITYCOUNCIL OF THE CITY OF LYNWOOD ACCEPTING THE CIP PRIORITY 2 STREET IMPROVEMENTPROJECT (PHASE 2A) FY 2022-2023 CHANGE ORDER APPROVAL.” Background:

On July 20, 2021, the City Council adopted the City’s Biennial Budget for Fiscal Year 2021-22 (FY22) and FiscalYear 2022-23 (FY23) which included a Capital Improvement Program (CIP) Budget for two years. For the FY22,the City Council approved the use of HIP revenues for the Priority 2 Streets Project (CIP 4011.68.104) (Project). On August 26, 2022, the Notice Inviting Bids (NIB) was advertised on the City’s web site (PlanetBids). The Bidopening took place in the PlanetBids Platform on Thursday, September 22, 2022, at 10:00 AM (PST). SequelContractors, Inc. was the apparent lowest responsible bidder with a low base bid of $1,148,725.80. A Notice to Proceed will be issued to Sequel Contractors, Inc. to commence work in January 2023. The scope of work consists of the construction of new ADA compliant curb ramps where needed and willrehabilitate, gutters, sidewalks, driveway approaches and pavement for the city streets that are in need of repairs.Striping will also be rehabilitated to enhance vehicular and pedestrian safety where needed. New signage will beinstalled, and utility covers adjusted. Outdated curbs at the intersections will be updated to handicapped ramps. The current Priority 2 Phase 2A segments are: Segment Name From To1 Alma Avenue Ruth Street Mallison Avenue2 Alma Avenue Mallison Avenue Otis Street3 Los Flores Boulevard Santa Fe Avenue Penn Street City Council Regular Meeting - Page 97 of 1385
4 Los Flores Boulevard Penn Street Franklin Street5 Los Flores Boulevard Franklin Street Bellinger Street6 Los Flores Boulevard Long Beach Blvd California Avenue7 Los Flores Boulevard California Avenue Imperial Hwy8 Los Flores Boulevard Atlantic Avenue Virginia Avenue9 Los Flores Boulevard Virginia Avenue Pope Avenue10 Los Flores Boulevard Pope Avenue Duncan Avenue11 San Luis Avenue Abbott Road Alma Avenue12 San Luis Avenue Alma Avenue Norton Avenue13 San Miguel Avenue Abbott Road Norton Avenue On August 2, 2022 the city awarded Pavement Coatings Co., with the Citywide Slurry Seal (Phase 2) contract inthe amount of $299,931.10. Before a Notice to Proceed was issued to Pavement Coatings Co., there wereseveral design issues discovered that caused the removal of eight (8) segments from the scope of work. Thesestreets no longer qualify for Slurry Seal and are recommended to be inserted as reconstruction, grind & overlay inPriority 2 Phase 2A. The removed segments from Slurry Seal Phase 2 are: No Segment From To1 Bellinger Street Lynwood Road Butler Avenue2 Carlin Avenue Alpine Avenue Oak Street3 Carlin Avenue Oak Street Long Beach Boulevard4 Carlin Avenue Castle Gate Avenue Stoneacre Avenue5 El Segundo Boulevard Santa Fe Avenue Peach Avenue6 El Segundo Boulevard Peach Avenue Alpine Avenue7 Magnolia Avenue Alpine Avenue Long Beach Boulevard8 Oak Street Euclid Avenue Orchard Avenue Discussion and Analysis:

Pavement Coatings Co. issued the city a credit in the amount of $56,156.10 for the eight (8) removed street segments. Following a detailed discussion with the design engineer, the public works department recommends the removedstreet segments be added via change order to Sequel Contractors, Inc. as part of the Priority 2 Phase 2 A project. Sequel Contractors, Inc. has provided a cost estimate for the additional streets in the amount of $351,400.00. With the credit of $56,156.10 issued from Pavement Coatings Co., the city will need additional funding in theamount of $418,843.90 for the added street segments requiring grind and overlay. Projected Construction Cost and Approved Budget: The table below is the proposed revised construction budget and additional appropriation need. Original Construction contract amount $1,148,725.80Added 8 Segments from Slurry Phase 2 $351,400.00New Construction Contract Amount $1,500,125.8010% Contingency $150,013.00Construction Inspection (15%) $225,019.00Project Management (8.5%) $127,511.00Labor Compliance & Other Cost (1.0%) $15,331.20Total Revised Estimated Construction Cost $2,018,000.00 City Council Regular Meeting - Page 98 of 1385
SB-1 $408,501.04HIP Revenue $327,645.36STPL Balanced (Non-federalized) $806,853.60Contract Change Order #1 – Pavement Coatings, Co. Slurry SealPhase 1 Credit $56,156.10 New Appropriation from 2019 Lease Revenue Bond $418,843.9FY23 Revised Approved Budget $2,018,000.00

Fiscal Impact:

The Project has an approved FY23 Budget of $1,543,000.00 whereas the total revised estimated constructionbudget is $2,018,000.00. With the transfer of credit of $56,156.10 from Slurry Seal Phase 2 into the Priority 2 Phase 2A project budget, anadditional appropriation of $418,843.90 from 2019 Lease Revenue Bond is needed to complete the project.

Coordinated With:

City Manager’s OfficeDepartment of Finance and Administration Services ATTACHMENTS:Description
Resolution
City Council Regular Meeting - Page 99 of 1385
1 RESOLUTION. ________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD ACCEPTING THE CIP PRIORITY 2 STREET IMPROVEMENT PROJECT (PHASE 2A) FY 2022 -2023 CHANGE ORDER APPROVAL.

WHEREAS, the City Council adopted the City’s Biennial Budget for Fiscal Year 2021-22 (FY22) and Fiscal Year 2022 -23 (FY23) which included a Capital Improvement Program (CIP) Budget for two years. For the FY22, the City Council approved the use of HIP revenues for the Priority 2 Streets Project (CIP 4011.68.104) (Project).; and

WHEREAS, the Priority 2 Phase 2 A ( Project) of the construction of new ADA compliant curb ramps where needed and will rehabilitate, gutters, sidewalks, driveway approaches and pavement for the city streets that are in need of repairs. Striping will also be rehabilitated to enhance vehicular and pedestrian safety where needed. New signage will be installed, and utility covers adjusted. Outdated curbs at the intersections will be updated to handicapped ramps.; and

WHEREAS, the current segments are 1.) Alma Avenue from Ruth Avenue to Mallison Avenue; 2.) Alma Avenue from Mallison Avenue to Otis Street; 3.) Los Flores Boulevard from Atlantic Avenue to Virginia Avenue; 4.) Los Flores Boulevard from Virginia Avenue to Pope Avenue.; 5.) Los Flores Boulevard from Pope Avenue to Duncan Avenue; 6.) Los Flores Boulevard from Santa Fe Avenue to Penn Street; 7.) Los Flores Boulevard from Penn Street to Franklin Street; 8.) Los Flores Boulevard from Franklin Street to Bellinger Street;

9.) Los Flores Boulevard from Long Beach Boulevard to California Avenue; 10.) Los Flores Boulevard from California Avenue to Imperial Highway; 11.) San Luis Avenue from Abbott Road to Alma Avenue; 12.) San Luis Avenue from Alma Avenue to Norton Avenue; 13.) San Miguel Avenue from Abbott Road to Norton Avenue.; and

WHEREAS, the contractor requested approval for additional change order in amount of $351,400.00 for the addition of eight (8) street segments that were removed from the Slurry Seal Phase 2 scope of work.; and

WHEREAS, the additional segments are 1.) Bellinger Street from Lynwood R oad to Butler Avenue; 2.) Carlin Avenue from Alpine Avenue to Oak St; 3.) Carlin Avenue from Oak Street to Long Beach Boulevard; 4.) Carlin Avenue from Castle Gate Avenue to Stoneacre Avenue; 5.) El Segundo Boulevard from Santa Fe Avenue to Peach Avenue; 6.) El Segundo Avenue from Peach Avenue to Alpine Avenue; 7.) Magnolia Avenue from Alpine Avenue to Long Beach Boulevard; 8.) Oak Street from Euclid Avenue to Orchard Avenue.; and

WHEREAS, with the credit of $56,156.10 issued from Pavement Coatings Co., for the removed Slurry Seal Phase 2 street segments, the city will need additional appropriation in the amount of $ 418,843.90 from 2019 Lease Revenue Bond for the added segments requiring grind and overlay.

City Council Regular Meeting - Page 100 of 1385
1 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER, AND RESOLVE AS FOLLOWS:

Section 1. That the City Council of the City of Lynwood approves the increase of the project funding of $418,843.90 for Priority 2 Street Improvement Project (Phase 2A).

Section 2. That the City Council of the City of Lynwood approve an additional allocation of $418,843.90 from 2019 Lease Revenue Bond funding to Priority 2 Street Improvement Project (Phase 2A) funding.

Section 3. That the project budget be increased from $1,543,000.00 to $2,018,000.00.

Section 4. This Resolution shall take effect immediately upon its adoption.

Section 5. The City Clerk shall certify to the adoption of this Resolution and hereafter the same shall be in full force and effect.

(Signatures on Next Page)
City Council Regular Meeting - Page 101 of 1385
3 PASSED, APPROVED and ADOPTED this 20th day of December 2022.

Oscar Flores
Mayor

ATTEST:

Maria Quinonez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

Noel Tapia Julian Lee
City Attorney Director of Public Works
City Council Regular Meeting - Page 102 of 1385
4 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSTAIN:

ABSENT:

Maria Quinonez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

Maria Quinonez, City Clerk
City Council Regular Meeting - Page 103 of 1385
Agenda Item # 15.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public Works
SUBJECT: REQUEST TO REPAIR AND REHABILITATE THE NATATORIUM POOL DRAIN ANDOUTLET PIPING Recommendation:

Staff recommends that the City Council adopt the following resolution entitled: “A RESOLUTION OF THE CITYCOUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENT WITH 316 CONSTRUCTION &ENGINEERING, INC. FOR AN AMOUNT OF $133,475 TO REPAIR AND REHABILITATE THENATATORIUM POOL DRAIN AND OUTLET PIPING; AND AUTHORIZING THE CITY MANAGER TOAPPROVE UP TO TEN PERCENT OF THE CONTRACT PRICE FOR ADDITIONAL SERVICES ASNEEDED.” Background:

On March 1, 2022, the City Council by minute action approved the recommended repairs at the Natatorium, theCity’s pool. The Acting City Engineer recommended immediate repairs of the patio wall, pool deck floor, electricaland interior wall to the City Manager. Upon that recommendation and authority delegated by the City Council to theCity Manager, the City Manager has ordered certain emergency repairs at the Natatorium. On April 5, 2022, the City Council found that there is substantial evidence in the record demonstrating that thepatio wall shows major signs of compromised structural deficiencies, the pool deck shows evidence of detachingand cracking throughout the surface of the pool deck, the electrical system requires replacement to preventelectrical shorts and possible fire, and the pool wall requires replacement to avoid collapse has created an createdan emergency requiring immediate action to procure the necessary equipment, services, and supplies for thosepurposes, without giving notice for bids to let contracts.

To date, the conditions necessitating the emergency actions continue to exist. The emergency renovations andrepairs have not been completed and additional repairs have been recommended to include the pool drain andoutlet piping.

Discussion and Analysis:

City Council Regular Meeting - Page 104 of 1385
Pursuant to Section 6-3.7(b)(2) of the Lynwood Municipal Code, purchases between $50,001 and $200,000 shallbe by an informal bid process and must be approved by the City Council. Staff issued a Notification of a JobWalk with a Request for Quotes to receive bids for the Natatorium pool drain and outlet piping. Staff reached outto three companies: Doreck Constructors, Jose Salazar Construction, and 316 Engineering & Construction, Inc.Only one company arrived for the job walk, reviewed the CCTV footage, and submitted a quote for requestedservices. Staff recommends that the City Council authorize the City Manager to open and proceed with the award of thework to 316 Engineering & Construction, Inc. for the Natatorium pool drain and outlet piping repair andrehabilitation portion of the project to shore up the infrastructure and avoid a potential collapse of the piping.

Fiscal Impact:

On March 1, 2022, the City Council approved certain repairs at the Natatorium for the public’s safe use as well asapproved a $5,000,000 budget for these repairs. The City Council also approved the following funding sources:$1.5 million from Assemblyman Rendon, and $3.5 million 2019 Lease Revenue Bonds. In March 2022, the Stateexecuted a grant agreement providing a grant in the amount of $1,500,000 for the Natatorium renovation. Funding for the Natatorium Renovation & Emergency Project 4011.68.113.62015 balance is currently$4,625,172.47. Staff recommends allocating a total of $187,000.00 for the pool drain and outlet piping repair andrehabilitation portion of the project. The table below is the proposed project budget and funding details. Construction contract amount $133,475.0010% Contingency $13,348.00Construction Inspection (15%) $20,021.00Project Management (10%) $13,348.00Labor Compliance & Other Cost (5.1%) $6,808.00Total Estimated Construction Cost $187,000.00 CIP FUNDING - 4011.68.113.62015 $4,625,172.47Estimated Construction Cost $187,000.00Remaining Fund Balance $4,438,172.47 Coordinated With:

City Manager’s OfficeDepartment of Finance and Administration Services ATTACHMENTS:Description
Resolution
Attachment 1 - Natatorium Pool Drain Replacement Quote
Exhibit A
City Council Regular Meeting - Page 105 of 1385
RESOLUTION._____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD TO APPROVE AN AGREEMENT WITH 316 CONSTRUCTION & ENGINEERING, INC. FOR AN AMOUNT OF $133,475 TO REPAIR AND REHABILITATE THE NATATORIUM POOL DRAIN AND OUTLET PIPING; AND AUTHORIZING THE

CITY MANAGER TO APPROVE UP TO FIVE PERCENT OF THE CONTRACT

PRICE FOR ADDITIONAL SERVICES AS NEEDED

WHEREAS, during review of the current Natatorium Renovation and Emergency Project, staff requested a CCTV of the pool drain and pipe; and

WHEREAS, the CCTV found that there are several collapsed areas around the pool drain and throughout the outlet piping with compaction voids that make it necessary to repair the outlet piping and infrastructure; and

WHEREAS, on March 1, 2022, the City Council by minute action approved the recommended repairs at the Natatorium, the City’s pool; and

WHEREAS, the renovations and repairs have not been completed and additional repairs have been recommended to include the pool drain and outlet piping; and

WHEREAS, pursuant to LMC Section 6-3.7(b)(2), staff issued a Notification of a Job Walk with a Request for Quotes to receive bids for the Natatorium pool drain and outlet piping; and

WHEREAS, only one company arrived for the job walk, reviewed the CCTV footage, and submitted a quote for requested services; and

WHEREAS, staff recommends that the City Council authorize the City Manager to open and proceed with the award of the work to 316 Engineering & Construction, Inc. for the Natatorium pool drain an d outlet piping repair and rehabilitation portion of the project to shore up the infrastructure and avoid a potential collapse of the piping.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER AND RESOLVE AS FOLLOWS:

Section 1 . The City Council of the City of Lynwood hereby finds and declares that the foregoing recitals are true and correct, and incorporates them herein as findings and as a substantive part of this Resolution.

Section 2. That the City Council approves to award an agreement to 316 Engineering & Construction, Inc. for $ 133,475.00 and authorizes the Mayor to execute an Agreement attached hereto as Exhibit A in a form approved by the City Attorney.

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2 Section 3. That the City Council authorizes the City Manager to approve additional services for a not to exceed amount of 10% of the contract price.

Section 4. That the City Council authorizes the City Attorney to negotiate the final form of the Agreement.

Section 5. That this Resolution shall take effect immediately upon its adoption.

Section 6. That the City Clerk shall certify to the adoption of this Resolution.

PASSED, APPROVED and ADOPTED this 20th day of December 2022.

______________________________
Oscar Flores
Mayor
ATTEST:

___________________________ ______________________________ María Quiñónez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

__________________________ ______________________________ Noel Tapia Julian Lee
City Attorney Director of Public Works

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3 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSTAIN:

ABSENT:

________________________
Maria Quiñónez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, and the Cle rk of the City Council of said City, do hereby certify that the above foregoing is a full, true and correct copy of Resolution No. ____________ on file in my office and that said Resolution was adopted on the date and by the vote therein stated. Dated this 20th day of December 2022.

________________________
Maria Quiñónez, City Clerk

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7434 Garvalia Ave. Rosemead, CA. 91770
818-395-7989 Fax: 626-307-4360
Email: [email protected]

Date: 11/17/2022
Quotation #: 22-098 R-1
To: City of Lynwood
Attention: George Cambero
Reference: Lynwood Natatorium Pool Drain Replacement
We are pleased to offer the following quotation to replace the existing main line cast iron drain pipe with schedule 40 PVC pipe. Reconnect existing drains to main line. Replace cleanouts up to deck height.

Bid Includes the following:

o Saw cutting 500 ln ft of 10” thick slab for trench
o Remove concrete from trench and haul away
o Excavate down to expose existing drain pipe (assumed 5’ max) o Remove existing cast iron drain pipe and replace with schedule 40 PVC pipe
o Connect existing drains to new main line
o Install cleanouts in kind to existing
o Backfill trench using native material
o Drill #4 dowels into existing concrete at 24” OC staggered o Pour back concrete trench width

TOTAL QUOTE $133,475.00

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Bid Alternate #1: Installing Lining Into Existing Pipe

o Saw cutting 10” thick slab at all four corners of drain piping for access to install liner
o Remove concrete from trench and haul away
o Excavate down to expose existing drain pipe at 4 locations (assumed 5’ max)
o Remove existing cast iron drain pipe 90’s for liner installation o CCTV line to locate Clean outs, Drain line tie-ins to main and any broken or collapsed area’s of main line.
o Excavate for spot repairs as needed (price per spot repair below. At this time we do not know how many spot repairs are needed.) o Install liner
o Cut liner out of cleanouts and drain line tie-ins
o Install new PVC 90’s at corners
o Backfill trench using native material
o Drill #4 dowels into existing concrete at 24” OC staggered o Pour back concrete trench width

Bid Alt #1 QUOTE $121,800.00 SINGLE SPOT REPAIR QUOTE $8,125.00

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Exclusions:
• Permit fee’s
• Anything not specifically listed in this quote.
• Assumed soil to be C-60 type
• Digging in rock or sugar sand (Additional Charge)

We appreciate the opportunity to supply this quotation. If there should be any questions or should you need any further information, please do not hesitate to contact us.

Sincerely

John Massie
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1 PROFESSIONAL SERVICES AGREEMENT

R E C I T A L S

WHEREAS, City desires to utilize the services of Consultant as an independent contractor to [insert brief description of work] as set forth in the Scope of Services attached hereto as Exhibit A; and

WHEREAS, Consultant represents that it is fully qualified to perform such consulting services by virtue of its experience and the training, education and expertise of its principals and employees.

NOW, THEREFORE, in consideration of performance by the parties of the covenants and conditions herein contained, the parties hereto agree as follows:

1. Company's Scope of Services. The nature and scope of the specific services to be performed by Consultant are as described in Exhibit A.

3. Compensation.

B. Total payment to Consultant pursuant to this Agreement shall not exceed ______________________________.

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2 4. General Terms and Conditions. The General Terms and Conditions set forth in Exhibit B are incorporated as part of this Agreement. In the event of any inconsistency between the General Terms and Conditions and any other exhibit to this Agreement, the General Terms and Conditions shall control unless it is clear from the context that both parties intend the provisions of the other exhibit(s) to control.

5. Addresses.

City of Lynwood

City of Lynwood
11330 Bullis Road
Lynwood, CA 90262
Attn: Jose Ometeotl, City Manager

Company

[Insert Selected Consulting Firm]
Attn: [Insert Contact Name]

6. Exhibits. All exhibits referred to in this Agreement are listed here and are incorporated and made part of this Agreement by this reference.

Exhibit A – Scope of Work/Services and Compensation Schedule Exhibit B – General Terms and Conditions

SIGNATURES ON FOLLOWING PAGE

IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates written below.

CITY

CITY OF LYNWOOD

By: ______________________________ ______________________ Mayor Date

CONSULTANT

[Insert Consultant Name]

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3 By: _______________________________ ________________________ [Insert Consultant Name] Date

ATTEST:

By: ______________________________ ________________________ City Clerk Date

APPROVED AS TO FORM:

By: ______________________________ ________________________ City Attorney Date

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4 EXHIBIT A

SCOPE OF WORK/SERVICES

City Council Regular Meeting - Page 115 of 1385

EXHIBIT B

GENERAL TERMS AND CONDITIONS

1. Status as Independent Contractor.

A. Consultant is, and shall at all times remain as to City, an independent contractor.

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2. Standard of Performance

3. Indemnification.

4. Insurance.

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B. City, its officers, officials, employees, and volunteers shall be named as additional insureds on the policy(ies) as to commercial general liability and automotive liability.

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Endorsements shall be executed on City’s appropriate standard forms entitled "Additional Insured Endorsement".

5. Release of Information/Confidentiality.

6. Ownership of Work Product.

A. Consultant shall maintain complete and accurate records with respect to City Council Regular Meeting - Page 119 of 1385

7. Conflict of Interest.

10. Non-Discrimination and Equal Employment Opportunity.

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20. Severability. If any provision or any part of any provision of this Agreement is found City Council Regular Meeting - Page 122 of 1385

to be invalid or unenforceable, the balance of this Agreement shall remain in full force and effect.

Amendments on behalf of the City will only be valid if signed by the Mayor and attested by the City Clerk.

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Agenda Item # 16.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Patrick Matson, Director of Human Resources/Risk Management SUBJECT: A RESOLUTION OF THE CITY COUNCIL AND THE CITY OF LYNWOOD AMENDINGITS COMPENSATION (SALARY SCHEDULE) PLAN TO COMPLY WITH THE STATEOF CALIFORNIA’S MINIMUM WAGE LAW FOR ITS PART-TIME CASHIER ANDLOCKER ATTENDANT POSITIONS Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled, “A RESOLUTION OF THE CITYCOUNCIL AND THE CITY OF LYNWOOD AMENDING ITS COMPENSATION (SALARY SCHEDULE)PLAN TO COMPLY WITH THE STATE OF CALIFORNIA’S MINIMUM WAGE LAW FOR ITS PART-TIMECASHIER AND LOCKER ATTENDANT POSITIONS”.

Background:

In preparation for the upcoming State of California’s Minimum Wage Law increase, the City Council must amendthe City’s compensation plan, including any amendments to the salary schedule, by way of resolution inaccordance with Rule V, Sections 1-2 of the City’s Personnel Rules and Regulations (Exhibit A).

Discussion and Analysis:

The State of California has implemented a minimum wage increase from $15.00 an hour to $15.50 an hour, whichwill take effect on January 1, 2023. In reviewing the City’s salary schedule (Exhibit B), 2 part-time classifications,the Cashier and Locker Attendant, will be impacted by this increase. As such, staff is recommending a five-cent increase (from $15.45/hour to $15.50/hour) in the proposed salaryschedule for both part-time positions, which would follow the State’s minimum wage laws in 2013.

Fiscal Impact:

City Council Regular Meeting - Page 124 of 1385
Minimal overall fiscal impact as hourly rate increase is an additional 5 cents from its current hourly rate listed on thesalary schedule.

Coordinated With:

N/A
ATTACHMENTS:Description
Exhibit A - Rule V Personnel Rules and Regulations
Exhibit B - Updated Salary Schedule Reflecting State Minimum Wage Increase Effective 01012023 City Council Regular Meeting - Page 125 of 1385
)
)'
ROLE V

COMPENSATION
Section 1.Preparation Of Plan: The Personnel Officer or the person or agency employed for that purpose shall prepare a pay plan covering all classes of positions in the classified service, showing the minimum and maximum rates of pay. In arriving at such salary ranges, consideration shall be given to prevailing rates of pay for comparable work in other public and in private employment, including consideration of conditions of work as well as basic pay to current costs of living' to suggestions of department heads; and to the city's financial condition and policies. The Personnel Officer or the person or agency employed for that purpose shall thereafter make such further studies of the compensation plan as may be requested by the City Council.

Se c ti on 2. Adoption 0£ Plan: The Personnel Officer shall submit the proposed pay plan to the City Council. The Council shall adopt or amend the proposed plan. Thereafter, no position shall be assigned a salary higher than the maximum or lower than the minimum salary provided for that class or position unless the salary schedule for the class is amended in the same manner as herein provided for its adoption.
-10-
City Council Regular Meeting - Page 126 of 1385

CITY OF LYNWOOD

CLASSIFICATION & COMPENSATION SCHEDULE
Biweekly and Monthly Salaries & MOU-Related Pay
As of December 20, 2022

ELECTED OFFICIALS

UNIT JOB TITLE CURRENT
E Councilmember 975.00
E City Clerk 1,000.00
E City Treasurer 1,000.00
CITY MANAGEMENT: At-Will Contract Employees

JOB TITLE STEP A B C D E
Ex/AW City Manager* DOQ
Ex/AW Assistant City Manager DOQ
DEPARTMENT DIRECTOR: Executive Magagement At-Will Contract Employees (Under Reso No. 2021.105)

JOB TITLE STEP A B C D E
Ex/AW Director of Community Development Annual Salary 157,071.58 164,925.17 173,171.43 181,830.01 190,921.52 Monthly Salary 13,089.30 13,743.77 14,430.96 15,152.51 15,910.13 Ex/AW Director of Finance Annual Salary 146,875.55 154,219.33 161,930.30 170,026.83 178,528.17 Monthly Salary 12,239.62 12,851.62 13,494.19 14,168.90 14,877.35 Ex/AW Director of HR & Risk Management Annual Salary 146,875.55 154,219.33 161,930.30 170,026.83 178,528.17 Monthly Salary 12,239.62 12,851.62 13,494.19 14,168.90 14,877.35 Ex/AW Director of Public Works Annual Salary 157,071.58 164,925.17 173,171.43 181,830.01 190,921.52 Monthly Salary 13,089.30 13,743.77 14,430.96 15,152.51 15,910.13 Ex/AW Director of Recreation & Community Services Annual Salary 146,875.55 154,219.33 161,930.30 170,026.83 178,528.17 Monthly Salary 12,239.62 12,851.62 13,494.19 14,168.90 14,877.35 Ex/AW Director of Technology Services Annual Salary 140,696.22 147,731.04 155,117.59 162,873.48 171,017.16 Monthly Salary 11,724.68 12,310.92 12,926.46 13,572.79 14,251.43 DEPARTMENT DIRECTOR: Executive Magagement At-Will Contract Employees (Pre-Date Reso No. 2021.105)

JOB TITLE STEP A B C D E
Ex/AW Director of Recreation & Community Services* DOQ
Ex/AW Director of Technology Services* DOQ
MANAGEMENT: At-Will Contract Employees
M/AW Assistant City Engineer DOQ
M/AW City Engineer DOQ
MANAGEMENT: At-Will Contract Employees
M/AW Deputy Director of Finance DOQ
M/AW Deputy Director of Community Development DOQ
M/AW Controller DOQ
M/AW Risk Manager DOQ
M/AW American Rescue Plan Act Coordinator* Monthly 6,999.28 Annually 83,991.45
MANAGEMENT CIVIL SERVICE EMPLOYEES - Supervisory, Professional & Technical Staff

UNIT JOB TITLE BAND STEP A B C D E
M. Accounting/Auditing Supervisor M-54 2,911.02 3,053.82 3,240.04 3,418.25 3,606.25 6,307.22 6,616.61 7,020.10 7,406.20 7,813.54 M. Accountant M-55 2,941.59 3,085.89 3,274.06 3,454.14 3,644.12 6,373.45 6,686.09 7,093.80 7,483.97 7,895.58 M. Administrative Analyst II M-50 2,668.27 2,801.69 2,941.77 3,088.86 3,243.30 5,781.25 6,070.32 6,373.84 6,692.53 7,027.15

UNIT JOB TITLE BAND STEP A B C D E
M Administrative Analyst III M-56 3,109.47 3,266.20 3,427.28 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 City Council Regular Meeting - Page 127 of 1385
Ex. Assistant to the City Manager M-65 3,847.06 4,016.26 4,193.91 4,380.45 4,576.32 8,335.29 8,701.89 9,086.81 9,490.98 9,915.35 M Billing & Collections Supervisor M-54 2,911.02 3,053.82 3,240.04 3,418.25 3,606.25 6,307.22 6,616.61 7,020.10 7,406.20 7,813.54 M Building Official M-70 4,611.69 4,845.74 5,088.05 5,342.20 5,608.46 9,992.00 10,499.10 11,024.10 11,574.77 12,151.65 M Civil Engineer M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M Deputy Dir. of Admin. Services M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M Deputy Dir. of Public Works M-71 5,501.63 5,666.68 5,836.68 6,011.78 6,192.13 11,920.20 12,277.81 12,646.14 13,025.52 13,416.29 M Deputy Dir. of Rec and Comm Services M-70 4,611.69 4,845.74 5,088.05 5,342.20 5,608.46 9,992.00 10,499.10 11,024.10 11,574.77 12,151.65 M Electrical Maintenance Supervisor M-45 2,374.55 2,492.97 2,618.37 2,751.59 2,889.16 5,144.86 5,401.44 5,673.13 5,961.78 6,259.85 M Deputy City Clerk M-52 2,819.49 2,959.68 3,109.47 3,266.20 3,427.28 6,108.90 6,412.64 6,737.18 7,076.77 7,425.77 M. Deputy City Treasurer M-52 2,819.49 2,959.68 3,109.47 3,266.20 3,427.28 6,108.90 6,412.64 6,737.18 7,076.77 7,425.77 M/Conf. Human Resources & Risk Analyst M-52 2,819.49 2,959.68 3,109.47 3,266.20 3,427.28 6,108.90 6,412.64 6,737.18 7,076.77 7,425.77 M Planning Associate M-56 3,109.47 3,266.20 3,427.29 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 M Planning Manager M-69 4,379.65 4,631.48 4,897.79 5,179.42 5,477.23 9,489.24 10,034.88 10,611.88 11,222.07 11,867.34 M Principal Accountant M-65 3,847.06 4,016.26 4,193.91 4,380.45 4,576.32 8,335.29 8,701.89 9,086.81 9,490.98 9,915.35 M Principal Planner M-67 4,078.61 4,200.11 4,413.54 4,634.63 4,914.17 8,836.99 9,100.24 9,562.67 10,041.69 10,647.36

UNIT JOB TITLE BAND STEP A B C D E
M Public Safety Manager M-65 3,847.06 4,016.26 4,193.91 4,380.45 4,576.32 8,335.29 8,701.89 9,086.81 9,490.98 9,915.35 M Public Works Operations Manager M-69 4,379.65 4,631.48 4,897.79 5,179.42 5,477.23 9,489.24 10,034.88 10,611.88 11,222.07 11,867.34 M Public Works Operations Supervisor M-56 3,109.47 3,266.20 3,427.29 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 M Public Works Special Projects Mgr M-71 5,501.63 5,666.68 5,836.68 6,011.78 6,192.13 11,920.20 12,277.81 12,646.14 13,025.52 13,416.29 M Recreation Facility & Program Supervisor M-50 2,668.27 2,801.69 2,941.77 3,088.86 3,243.30 5,781.25 6,070.32 6,373.84 6,692.53 7,027.15 M Recreation Superintendent II M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M. Senior Accountant M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M/Conf. Senior Human Resources & Risk Analyst M-65 3,847.06 4,016.26 4,193.91 4,380.45 4,576.32 8,335.29 8,701.89 9,086.81 9,490.98 9,915.35 M/Conf. Senior Management Analyst M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M Senior Project Manager M-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96 M Senior Public Works Manager M-56 3,109.47 3,266.20 3,427.29 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 M System Analyst M-56 3,109.47 3,266.20 3,427.29 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 M Water Operations Supervisor M-56 3,109.47 3,266.20 3,427.29 3,604.05 3,786.91 6,737.18 7,076.77 7,425.78 7,808.77 8,204.98 CIVIL SERVICE EMPLOYEES - Leads & General Staff - - - - -

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E G Account Clerk G-31 1,696.84 1,781.77 1,871.09 1,963.88 2,061.95 3,676.50 3,860.51 4,054.02 4,255.08 4,467.57 G Accounting Technician G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E G Administrative Assistant G-41 2,165.27 2,273.84 2,387.65 2,506.72 2,632.82 City Council Regular Meeting - Page 128 of 1385
4,691.42 4,926.65 5,173.24 5,431.23 5,704.45 G Assistant Administratuve Analyst G-43 2,273.84 2,387.65 2,506.72 2,632.82 2,766.79 4,926.64 5,173.24 5,431.24 5,704.44 5,994.72 G Assistant to the City Clerk G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92 G Building Inspector G-55 2,819.49 2,959.68 3,109.47 3,266.20 3,427.28 6,108.90 6,412.65 6,737.18 7,076.77 7,425.77 G Building Maintenance Lead Worker G-43 2,273.84 2,387.65 2,506.72 2,632.82 2,766.79 4,926.64 5,173.24 5,431.24 5,704.44 5,994.72 G Building Maintenance Worker G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92 G Business License Officer G-36 1,916.60 2,012.05 2,112.72 2,218.67 2,329.88 4,152.63 4,359.44 4,577.57 4,807.12 5,048.07 G Business License Technician G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92 G Custodian G-29 1,616.28 1,696.84 1,781.77 1,871.08 1,963.88 3,501.95 3,676.49 3,860.51 4,054.02 4,255.08 G Electrical Maintenance Worker G-42 2,210.81 2,337.93 2,472.36 2,614.52 2,764.85 4,790.08 5,065.50 5,356.77 5,664.79 5,990.52 G Executive Assistant to G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 Community Development 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G Executive Assistant G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G/Conf. Human Resources & Risk Technician G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92 G/Conf. Human Resources & Risk Specialist G-45 2,411.52 2,531.79 2,659.15 2,794.45 2,934.16 5,224.97 5,485.54 5,761.48 6,054.64 6,357.35 G Garage/Fleet Coordinator G-34 1,825.43 1,916.70 2,012.53 2,113.16 2,218.82 3,955.09 4,152.85 4,360.48 4,578.51 4,807.45 G Information System Assistant G-37 1,963.88 2,061.96 2,165.27 2,273.83 2,387.66 4,255.08 4,467.57 4,691.41 4,926.62 5,173.26

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E G Information System Technician G-41 2,165.27 2,273.84 2,387.65 2,506.72 2,632.82 4,691.42 4,926.65 5,173.24 5,431.23 5,704.45 G Laborer G-24 1,429.79 1,501.60 1,576.89 1,655.70 1,738.87 3,097.89 3,253.46 3,416.58 3,587.36 3,767.55 G Lead Custodian G-34 1,825.43 1,916.70 2,012.53 2,113.16 2,218.82 3,955.09 4,152.85 4,360.48 4,578.51 4,807.45 G Lead Public Safety Officer G-54 2,652.68 2,784.97 2,925.06 3,073.89 3,227.58 5,747.47 6,034.10 6,337.63 6,660.10 6,993.08 G Maintenance Worker G-37 1,963.88 2,061.96 2,165.27 2,273.83 2,387.66 4,255.08 4,467.57 4,691.41 4,926.62 5,173.26 G Media Specialist G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G Office Assistant I G-12 1,066.43 1,119.84 1,175.88 1,234.54 1,296.72 2,310.60 2,426.32 2,547.75 2,674.84 2,809.55 G Office Assistant II G-24 1,429.79 1,501.60 1,576.89 1,655.70 1,738.87 3,097.89 3,253.46 3,416.58 3,587.36 3,767.55 G Park Maintenance Lead Worker G-43 2,273.84 2,387.65 2,506.72 2,632.82 2,766.79 4,926.64 5,173.24 5,431.24 5,704.44 5,994.72 G/Conf. Payroll Specialist G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G Permit Technician G-39 2,061.95 2,165.27 2,273.84 2,387.65 2,506.72 4,467.57 4,691.41 4,926.64 5,173.24 5,431.23 G Public Safety Officer G-45 2,411.52 2,531.79 2,659.15 2,794.45 2,934.16 5,224.97 5,485.54 5,761.48 6,054.64 6,357.35 G Public Works Assistant G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G Public Works Operations Coordinator G-34 1,825.43 1,916.70 2,012.53 2,113.16 2,218.82 3,955.09 4,152.85 4,360.48 4,578.51 4,807.45 G Public Works Inspector G-57 2,871.75 3,015.34 3,166.10 3,324.41 3,490.63 6,222.12 6,533.23 6,859.89 7,202.89 7,563.04 G Public Works Technician G-38 2,000.66 2,100.69 2,205.73 2,316.01 2,431.81 4,334.76 4,551.49 4,779.08 5,018.02 5,268.92

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E City Council Regular Meeting - Page 129 of 1385
G Recreation Coordinator G-39 2,061.95 2,165.27 2,273.84 2,387.65 2,506.72 4,467.57 4,691.41 4,926.64 5,173.24 5,431.23 G Recreation Specialist G-23 1,395.64 1,465.69 1,539.24 1,616.28 1,696.85 3,023.89 3,175.67 3,335.01 3,501.93 3,676.50 G Right -Of-Way Maintenance Lead Worker G-43 2,273.84 2,387.65 2,506.72 2,632.82 2,766.79 4,926.64 5,173.24 5,431.24 5,704.44 5,994.72 G Senior Accounting Technician G-46 2,492.98 2,618.37 2,751.59 2,889.16 3,031.98 5,401.45 5,673.13 5,961.78 6,259.84 6,569.29 G Sr. Building Inspector/Asst. Building Official G-61 3,383.95 3,553.15 3,730.81 3,917.35 4,113.21 7,331.89 7,698.49 8,083.42 8,487.58 8,911.96
G Senior Information Systems Technician G-44 2,329.87 2,470.07 2,568.89 2,699.36 2,835.06 5,048.06 5,351.82 5,565.93 5,848.61 6,142.64 G Senior Lifeguard G-23 1,395.64 1,465.69 1,539.24 1,616.28 1,696.85 3,023.89 3,175.67 3,335.01 3,501.93 3,676.50 G Senior Street Maintenance Worker G-39 2,061.95 2,165.27 2,273.84 2,387.65 2,506.72 4,467.57 4,691.41 4,926.64 5,173.24 5,431.23 G Street Maintenance Lead Worker G-43 2,273.84 2,387.65 2,506.72 2,632.82 2,766.79 4,926.64 5,173.24 5,431.24 5,704.44 5,994.72 G Street Maintenance Worker G-37 1,963.88 2,061.96 2,165.27 2,273.82 2,387.66 4,255.08 4,467.57 4,691.41 4,926.62 5,173.26 G Water Quality Specialist G-44 2,329.87 2,470.07 2,568.89 2,699.36 2,835.06 5,048.06 5,351.82 5,565.93 5,848.61 6,142.64 G Water Service/Wastewater Lead Worker G-58 2,991.13 3,132.69 3,282.58 3,441.83 3,606.28 6,480.79 6,787.49 7,112.26 7,457.30 7,813.60 G Water Service/Wastewater Worker I G-40 2,151.07 2,254.38 2,362.95 2,476.76 2,595.84 4,660.65 4,884.50 5,119.73 5,366.32 5,624.32 G Water Service/Wastewater Worker II G-45 2,411.52 2,531.79 2,659.15 2,794.45 2,934.16 5,224.97 5,485.54 5,761.48 6,054.64 6,357.35 G Water Service/Wastewater Worker III G-47 2,580.33 2,709.02 2,845.28 2,990.06 3,139.55 5,590.72 5,869.53 6,164.78 6,478.46 6,802.37 NON-CIVIL SERVICE - General and Exempt At-Will Staff
G/AW Community Liaison DOQ
G/AW Trainee DOQ
EX/AW CalPERS Retired Annuitant DOQ
HOURLY NON-CIVIL SERVICE - Part-Time, Temporary & Seasonal Staff Note: Minimum Wage Increase 1-1-22 Resolution 2018.215

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E G Administrative Intern H-43B 15.45 16.29 17.19 18.13 19.12 G Cashier (Pool)* H-66 15.50 - - - - G Information Systems Technician H-38A 27.10 28.19 29.33 30.54 31.80 G Laborer (PW) H-18 15.45 16.22 17.03 17.87 18.76 G Laborer (Recreation Facilites) H-15 15.45 16.22 17.03 17.87 18.76 G Lifeguard H-8 15.45 16.22 17.03 17.87 18.76 G Locker Attendant* H-6 15.50 - - - - G Maintenance Worker H-43 15.45 16.25 17.10 17.98 18.91 G Office Assistant II H-36B 15.45 16.22 17.01 17.87 18.76

UNIT JOB TITLE BAND STEP A STEP B STEP C STEP D STEP E G Public Safety Officer H-39 20.76 21.79 22.89 24.03 25.23 G Recreation Leader H-14 15.45 15.91 16.39 16.87 17.38 G Recreation Specialist/Instructor H-13 16.28 17.10 17.96 18.86 19.80 G Senior Lifeguard H-8B 15.45 16.29 17.19 18.13 19.12 *
* Eligible for any LEMG COLA
Hourly wage increased from $15.45 to $15.50 to comply with State of California Minimum Wage Law effective 1/1/23 City Council Regular Meeting - Page 130 of 1385
Agenda Item # 17.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Noel Tapia, City Attorney
SUBJECT: CONSIDERATION OF A RESOLUTION PROCLAIMING A LOCAL EMERGENCY,RATIFYING THE PROCLAMATION OF A STATE OF EMERGENCY BY GOVERNORNEWSOM, FINDING THAT THE PROCLAIMED STATE OF EMERGENCYCONTINUES TO IMPACT THE ABILITY TO MEET SAFELY IN PERSON, ANDDECLARING THAT THE CITY COUNCIL AND CITY COMMISSIONS ANDCOMMITTEES WILL COTINUE TO MEET REMOTELY IN ADHERENECE WITH AB361 IN ORDER TO ENSURE THE HEALTH AND SAFETY OF THE PUBLIC Recommendation:

Staff is recommending that the City Council adopt a City Council Resolution entitled: “A Resolution Proclaiming aLocal Emergency, Ratifying the Proclamation of a State of Emergency by Governor Newsom, Finding that theProclaimed State of Emergency Continues to Impact the Ability to Meet Safely in Person, and Declaring that theCity Council and City Commissions and Committees Will Continue to Meet Remotely in Adherence With AB 361in Order to Ensure the Health and Safety of the Public” Background:

Beginning in March 2020, Governor Newsom issued a series of Executive Orders aimed at containing the novelcoronavirus (COVID-19). Among these were several Executive Orders N-25-20, N-29-20, N-35-20 (collectively,the Brown Act Orders) that waived requirements in the Brown Act expressly or impliedly requiring the physicalpresence of city councilmembers, staff, or the public at local agency meetings. On September 16, 2021, Governor Newsom signed Assembly Bill AB 361 (Rivas, 2021), which allows cities tocontinue to meet remotely during proclaimed states of emergency under modified Brown Act requirements that aresimilar, but not identical to the rules and procedures established by the Brown Act Orders.

Discussion and Analysis:

City Council Regular Meeting - Page 131 of 1385
Beginning in March 2020, Governor Newsom issued a series of Executive Orders aimed at containing the novelcoronavirus (COVID-19). Among these were several Executive Orders N-25-20, N-29-20, N-35-20 (collectively,the Brown Act Orders) that waived requirements in the Brown Act expressly or impliedly requiring the physicalpresence of city councilmembers, staff, or the public at local agency meetings. Specifically, the orders: • Waived the requirement that local agencies provide notice of each teleconference location from which amember of the legislative body will be participating in a public meeting; • Waived the requirement that each teleconference location be accessible to the public; • Waived the requirement that members of the public be able to address the legislative body at eachteleconference conference location;• Waived the requirement that local agencies post agendas at all teleconference locations; and, • Waived the requirement that at least a quorum of the members of the local body participate from locationswithin the boundaries of the territory over which the local body exercises jurisdiction. On June 11, 2021, the Governor issued Executive Order (EO) N-08-21 to begin winding down some of the priormeasures that were adopted to respond to COVID-19. Notably, EO N-08-21 rescinds the Brown Act Orders,effective September 30, 2021. On September 16, 2021, Governor Newsom signed Assembly Bill AB 361 (Rivas, 2021), which allows cities tocontinue to meet remotely during proclaimed states of emergency under modified Brown Act requirements that aresimilar, but not identical to the rules and procedures established by the Brown Act Orders. The pending expirationof the Brown Act Orders and the enactment of AB 361 created some ambiguity. To provide clarification, theGovernor issued Executive Order N-15-21, explaining that cities may continue to hold meetings in accordancewith the Brown Act Orders until September 30, or they may hold meetings in accordance with the requirements ofAB 361. Should the City Council wish to continue meeting remotely beyond September 30 pursuant to AB 361, the CityCouncil would be required to adopt the attached resolution. If the City Council chooses to utilize the option forremote meetings under AB 361, it can continue using the remote meeting procedures it has been using throughoutthe COVID-19 pandemic, subject to certain requirements that must be considered as part of the initialdetermination to adopt remote meeting protocols. Once adopted, the initial authorizing resolution is effective for nomore than thirty (30) days. The City may extend the authorization for an additional thirty (30) days via another resolution that makes specificfindings in support of continuing remote meetings. The City may continue to extend the authorization for additionalthirty (30) day increments for the duration of the declared emergency, or until the City Council decides to return toin-person meetings, or otherwise complies with the regular remote meeting requirements of the Brown Act. To implement remote meetings under AB 361, one of three criteria must be met at the time the City is holding ameeting during a proclaimed state of emergency by the Governor that includes area within the jurisdictionalboundaries of the City: • State or local officials have imposed or recommended measures to promote social distancing; or• For the purpose of determining, by majority vote, whether as a result of the state of emergency, meeting inperson would present imminent risks to the health or safety of attendees; or• The City Council has previously determined, by majority vote, that, as a result of the state of emergency,meeting in person would present imminent risks to the health or safety of attendees. If one of these three criteria are met, then the City can conduct meetings remotely via Government Code §§54953(e), et seq. If the City Council makes the required findings and chooses to meet remotely, every 30 days the City Council willbe required to make findings about whether the circumstances still apply. The City Council must find that itreconsidered the circumstances of the State of Emergency and that one of the following circumstances remains: • The City Council finds that meeting in person would present imminent risks to the health or safety ofattendees; or • State or local officials have imposed or recommended measures to promote social distancing.

City Council Regular Meeting - Page 132 of 1385
If the City Council makes the findings to continue having remote meetings, the City must meet the followingrequirements: 1. The City must give notice and post agendas as otherwise required by the Brown Act, including directionsfor how the public can access the meetings;2. Provide members of the public access to the meeting and an opportunity to address the body directly;3. Provide members of the public the opportunity to comment in real time;4. Suspend further action on items in the meeting agenda in the event that there is a disruption in the ability ofthe meeting to be broadcast to members of the public or in the ability for members of the public to comment; Fiscal Impact:

No fiscal impact is anticipated the proposed action.

Coordinated With:

ATTACHMENTS:Description
Reso- Continue Remote Meetings
City Council Regular Meeting - Page 133 of 1385
RESOLUTION NO. __________

A RESOLUTION OF THE CITY OF LYNWOOD PROCLAIMING A LOCAL

EMERGENCY, RATIFYING THE PROCLAMATION OF A STATE OF

EMERGENCY BY GOVERNOR NEWSOM, FINDING THAT THE PROCLAIMED

STATE OF EMERGENCY CONTINUES TO IMPACT THE ABILITY TO MEET

SAFELY IN PERSON, AND DECLARING THAT THE CITY COUNCIL AND CITY

COMMISSIONS AND COMMITTEES WILL CONTINUE TO MEET REMOTELY IN ADHERENCE WITH AB 361 IN ORDER TO ENSURE THE HEALTH AND SAFETY OF THE PUBLIC.

WHEREAS, all meetings of the City of Lynwood City Council as a legislative body are open and public, as required by the Brown Act (Cal. Gov. Code 54950 – 54963), so that any member of the public may attend, participate, and watch the City Council as a legislative body conduct their business; and

WHEREAS, th e Brown Act, Government Code section 54953(e), makes provisions for remote teleconferencing participation in meetings by members of a legislative body, without compliance with the requirements of Government Code section 54953(b)(3), subject to the existence of certain conditions; and

WHEREAS, on March 4, 2020, Governor Newsom declared a State of Emergency to make additional resources available, formalize emergency actions already underway across multiple state agencies and departments, and help the state prepare for a broader spread of COVID-19; and

WHEREAS, on March 17, 2020, Governor Newsom issued Executive Order N-29-20, which suspended certain provisions of the Brown Act in order to allow local legislative bodies to conduct meetings electronically with out a physical meeting place; and

WHEREAS, on June 11, 2021, the Governor issued Executive Order N -08- 21, which extended the provision of N -29-20 concerning the Brown Act and the conduct of public meetings through September 30, 2021; and

WHEREAS, since t he issuance of Executive Order N -08-21, the Delta variant has emerged, causing a spike in COVID-19 cases throughout the state; and

WHEREAS, Governor Newsom’s proclaimed State of Emergency remains in effect, and State and local officials, including the Los Angeles County Department of Public Health, have imposed or recommended measures to promote social distancing; and

WHEREAS, on September 16, 2021, California Assembly Bill 361 was signed into law, as urgency legislation that goes in effect on October 1, 2021, amending Government Code Section 54953 of the Ralph M. Brown Act to allow City Council Regular Meeting - Page 134 of 1385
2 legislative bodies to continue to meet remotely during a proclaimed state of emergency, provided certain conditions are met and certain findings are made; and

WHEREAS, the Cit y of Lynwood is committed to preserving and nurturing public access and participation in meetings of the Lynwood City Council; and

WHEREAS, the City Council desires to take the actions necessary to comply with AB 361 and to continue to hold its City Council, Commission and Committee meetings remotely.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY RESOLVE AND DETERMINE AS FOLLOWS:

Section 1. The City Council for the City of Lynwood finds and declares that the foregoing recitals are true and correct, and incorporates said recitals fully into this Resolution as substantive findings.

Section 2. The City Council hereby proclaims that a local emergency now exists throughout the City, and social distancing and condition caus ing imminent risk to attended has caused, and will continue to cause, conditions of peril to the safety of persons within the City that are likely to be beyond the control of services, personnel, equipment, and facilities of the City, and desires to procla im a local emergency and ratify the proclamation of State of Emergency by the Governor of the State of California.

Section 3. That the City Council has reconsidered the circumstances of the State of Emergency and finds the following circumstances:

a. The factors triggering the State of Emergency continue to directly impact the ability of the members of the City Council and the City’s subordinate Commissions and Committees to meet safely in person; and

b. The State of California and the City of Lynwood continue to impose or recommend measures to promote social distancing.

Section 4. City Council and City Commission and Committee meetings will continue to be conducted remotely for the next 30 days in compliance with AB 361 and Government Code Section ( e)(2), in order to ensure the health and safety of the public while provides access to public meetings.

Section 5. This Resolution shall become effective immediately and shall be reconsidered by the City Council in 30 days or sooner to assess the State o f Emergency and determine whether to continue with the provisions set forth in Assembly Bill 361.

City Council Regular Meeting - Page 135 of 1385
3 PASSED, APPROVED and ADOPTED this_____ day of ________, 2022.

_________________________
Jorge Casanova, Mayor
City of Lynwood

ATTEST:

________________________
Maria Quinonez, City Clerk

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

______________________ __________________________
Noel Tapia Ernie Hernandez,
City Attorney City Manager

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the above and foregoing resolution was duly adopted by the City Council of said City at its regular meeting thereof held in the City Hall of the City on the _________day of____________, 2022 and passed by the following vote:

City Council Regular Meeting - Page 136 of 1385
4 AYES:

NOES:

ABSTAIN:

ABSENT:

__________________________
City Clerk, City of Lynwood

STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, the undersigned City Clerk of the City of Lynwood, and Clerk of the City Council of said City, do hereby certify that the above and foregoing is a full, true and correct copy of Resolution No. _________ on file in my office and that said resolution was adopted on the date and by the vote therein stated.

Dated this ______ day of ________________, 2022.

__________________________
City Clerk, City of Lynwood
City Council Regular Meeting - Page 137 of 1385
Agenda Item # 18.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Maria Quinonez, City ClerkSilvia Pineda, Assistant to the City Clerk SUBJECT: SECOND READING OF ORDINANCE NO. 1755
Recommendation:

Staff recommends that the City Council adopt and conduct the second reading of Ordinance No. 1755 by title only.

Background:

On November 15, 2022, the City Council introduced Ordinance No. 1714, adopting the 2022 editions of theCalifornia Administrative, Building, Residential, Mechanical, Plumbing, Electrical, Green Building Standards,Energy, Historical Building, and Existing Building Codes, the 2021 International Property Maintenance Code andthe 2021 International Swimming Pool and Spa Code.

Discussion and Analysis:

N/A
Fiscal Impact:

There is no fiscal impact.

Coordinated With:

N/A
ATTACHMENTS:Description
Ordinance No. 1755
City Council Regular Meeting - Page 138 of 1385
1 ORDINANCE NO. 1755

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LYNWOOD ADOPTING BY REFERENCE THE 2022 EDITION OF THE CALIFORNIA

ADMINISTRATIVE, BUILDING, RESIDENTIAL, MECHANICAL,

PLUMBING, ELECTRICAL, GREEN BUILDING STANDARDS, ENERGY, HISTORICAL BUILDING, AND EXISTING BUILDING CODES, THE 2021

EDITION OF THE INTERNATIONAL PROPERTY MAINTENANCE CODE, AND THE 2021 EDITION OF THE INTERNATIONAL SWIMMING POOL

AND SPA CODE, TOGETHER WITH APPENDICES, AMENDMENTS,
DELETIONS AND PENALTIES, AND AMENDING CHAPTER 11 OF THE

LYNWOOD MUNICIPAL CODE

RECITALS

WHEREAS, the City Council of the City of Lynwood (“City”) hereby finds that the public health, safety, and welfare will be best protected and served by the adoption of various building and construction industry codes that are established and maintained by the State Building Standards Commission; and

WHEREAS, July 1, 2022, the C alifornia Building Standards Commission (“Commission”) released the 2022 edition of Title 24 of the California Code of Regulations, or the California Building Standards Code (“CBSC”), as part of the Commission’s Triennial Code Adoption Cycle; and

WHEREAS, pursuant to Health and Safety Code Section 17922 Government Code Section 50022.1, the City may adopt the latest versions of the CBSC by reference; and

WHEREAS, pursuant to Health and Safety Code Section 19758, the City may make amendments to the latest versions of the CBSC and other regulations, that are reasonably necessary because of local climatic, geological, or topographical conditions, upon express findings pursuance to Health and Safety Code Sections 17958.5 and 17958.7; and

WHEREAS, the express findings required by Health and Safety Code Sections 17958.5 and 17958.7 were made by the City Council pursuant to Resolution No. _____, which is hereby incorporated by reference as part of these recitals; and

WHEREAS, Health and Safety Code Sections 18938 et seq. specifies that the California Building Standards Code applies to all occupancies throughout the State; and

WHEREAS, all legal prerequisites to the adoption of this Ordinance have occurred.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY ORDAIN AS FOLLOWS:

City Council Regular Meeting - Page 139 of 1385
2 SECTION 1. The City Council hereby finds and determines that all of the above Recitals are true and correct and incorporates such Recitals into this Ordinance.

SECTION 2. Sections 11-1, 11-6, 11-7, 11-8, 11-9, 11-10, 11-18, 11-21 and 11- 22 of the Lynwood Municipal Code hereby are repealed; provided, however , that said repeal shall not affect or excuse any violation thereof occurring prior to the effective date of this Ordinance and provided further that the Codes adopted by reference and amended by Ordinance No. ____ of this City, shall continue to be applicable to construction wherein plans have been submitted for plan check as of the effective date of this Ordinance so long as the initial permit therefor is issued no later than ninety (90) days after the effective date of this Ordinance.

SECTION 3. A new Section 11-1 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-1
ADMINISTRATIVE CODE:

11-1.1 2022 California Administrative Code Adopted:

Except as provided in this Chapter, the “2022 California Administrative Code ” is hereby adopted in its entirety and shall be and become the Administrative Code of the City of Lynwood.

11-1.2 Conflicting Provisions:

In the event of a conflict between any provision contained in the Administrative Code and the administrative provisions of the City's building codes, the more specific provision shall be given effect, unless another applicable provision is determined by the Building Official to more fully provide for the public health and safety and/or will more fully promote the intent of the City's building codes."

SECTION 4. A new Section 11-6 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows

11-6
BUILDING CODE:

11-6.2 2022 California Building Code Adopted:

The “2022 California Building Code,” incorporating the “2021 International Building Code” as published by the International Code Council, hereby is adopted in its entirety as the Building Code of the City of Lynwood, together with the amendments, additions, deletions and exceptions set forth in this Chapter.

11-6.2 2022 California Building Code Amendments:

City Council Regular Meeting - Page 140 of 1385
3 [Reserved for future amendments]

SECTION 5. A new Section 11-7 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-7
RESIDENTIAL CODE:

11-7.1 2022 California Residential Code Adopted:

The ”2022 California Residential Code”, incorporating the “2021 International Residential Code” as published by the International Code Council, is hereby adopted in its entirety as the Residential Building Code of the City of Lynwood, together with the amendments, additions, deletions and exceptions set forth in this Chapter.

11-7.2 2022 California Residential Code Amendments:

The California Residential Code is hereby amended as follows:

TABLE R301.2(1)-AMENDED

TABLE R301.2(1)

CLIMATIC AND GEOGRAPHIC DESIGN CRITERIA

•
ROUNC
SNOW
LOAD

WINO DESIGN

SEISMIC
DESIGN

CATEGORY
f

SUBJECT TO DAMAGE FROM

WINTER
DESIGN
TEMP "

ICE

BARRIER

UNDERLAYM
ENT
REQUIRED"

FLOOD

HAZARDS
D

AIR

FREEZING
INDEX'

MEAN
ANNUAL
TEMPI

Speed
d
(mph)

Topographic
effects k
Special
wind
region'
Wind
borne
debris
zones

Weathering
•

Frost line
Depth

Termite
0 Zero

85 No

Negligible

Zero

Very Heavy

49 No

Zero

60 For SI: 1 pound per square foot = 0.0479 kPa, 1 mile per hour= 0.447 m/s.

a. Weathering may require a higher strength concrete or grade of masonry than necessary to satisfy the structural requirements of this code. The weathering column shall be filled in with the weathering index (i.e., "negligible," "moderate" or "severe") for concrete as determined from the Weathering Probability Map [Figure R301.2(3)]. The grade of masonry units shall be determined from ASTM C 34, C 55, C 62, C 73, C 90, C 129, C 145, C 216 or C 652.

b. The frost line depth may require deeper footings than indicat ed in Figure R403.1(1). The jurisdiction shall fill in the frost line depth column with the minimum depth of footing below finish grade.

c. The jurisdiction shall fill in this part of the table to indicate the need for City Council Regular Meeting - Page 141 of 1385
4 protection depending on whether there has been a history of local subterranean termite damage.

d. The jurisdiction shall fill in this part of the table with the wind speed from the basic wind speed map [Figure R30 l.2(4). Wind exposure category shall be determined on a site-specific basis in accordance with Section R301 .2.1.4.

e. Temperatures shall be permitted to reflect local climates or local weather experience as determined by the building official.

f. The jurisdiction shall fill in this part of the table with the seismic design category determined from Section R301.2.2.1.

g. The jurisdiction shall fill in this part of the table with {a) the date of the jurisdiction's entry into the National Flood Insurance Program (date of adoption of the first code or ordinance for management of flood hazard areas), (b) the date(s) of the Flood Insurance Study and (c) the panel numbers and dates of all currently effective FIRMs and FBFMs or other flood hazard map adopted by the authority having jurisdiction, as amended.

h. In accordance with Sections R905.2 .7.1, R905.4.3.1, R905.5.3.1, R905 .6.3.1, R905 .7.3.1 and R905.8.3.1, where there has been a history of local damage from the effects of ice damming, the jurisdiction shall fill in this part of the table with "YES. " Otherwise, the jurisdiction shall fill in this part of the table with" NO."

i. The jurisdiction shall fill in this part of the table with the 100 -year return period air freezing index (BF days) from Figure R403 .3(2) or from the I00-year (99%) value on the Nation al Climatic Data Center data table "Air Freezing Index -USA Method (Base 32°F)" at www.ncdc.noaa.gov/fpsf.htrnl.

j. The jurisdiction shall fill in this part of the table with the mean annual temperature from the National Climatic Data Center data table "Air Freezing Index -USA Method (Base 32°F)" at www.ncdc.noaa.gov/fpsf.html.

k. In accordance with Section R301.2.1.5, where there is local historical data documenting structural damage to buildings due to topographic wind speed -up effects, the jurisdiction shall fill in this part of the table with "YES." Otherwise, the jurisdiction shall indicate "NO" in this part of the table.

l. In accordance with Figure R301.2(4)A, where there is local historical data documenting unusual wind conditions, the jurisdiction shall fill in this part of the table with "YES" and identify any specific requirements. Otherwise, the jurisdiction shall indicate "NO" in this part of the table.

City Council Regular Meeting - Page 142 of 1385
5 m. In accordance with Section R301.2.1.2.1, the jurisdiction shall indicate the wind- borne debris wind zone(s). otherwise, the jurisdiction shall indicate "NO" in this part of the table.

n. The jurisdiction shall fill in these sections of the table to establish the design criteria using Table 1a or 1b from ACCA Manual J or established criteria determined by the jurisdiction.

o. The jurisdiction shall fill in this section of the table using the Ground Snow Loads in Figure R301.2(6)

SECTION 6. A new Section 11-9 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-9
ELECTRICAL CODE:

11-9.1 2022 California Electrical Code Adopted:

Except as provided in this Chapter, the “2022 California Electrical Code ”, based on the 2020 National Electrical Code as published by the National Fire Protection Association, is hereby adopted in its entirety as the Electrical Code of the City of Lynwood, regulating and controlling the installation, arrangement, alteration, repair, use and other operation of electrical wiring, connections, fixtures and electrical appliances on premises within the City.

11-9.2 2022 California Electrical Code Amendments:

[Reserved for future amendments]

SECTION 7. A new Section 11-10 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-10
MECHANICAL CODE:

11-10.1 2022 California Mechanical Code Adopted:

Except as provided in this Chapter, the “2022 California Mechanical Code”, based on the “2021 Uniform Mechanical Code ” as published by the International Association of Plumbing and Mechanical Officials, is hereby adopted in its entirety as the Me chanical Code of the City of Lynwood, regulating and controlling the design, construction, installation, quality of materials, location, operation and maintenance of heating, ventilating, cooling, refrigeration systems, incinerators and other miscellaneous heat producing appliances.

City Council Regular Meeting - Page 143 of 1385
6 11-10.2 2022 California Mechanical Code Amendments:

[Reserved for future amendments]

SECTION 8. A new Section 11-18 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-18
PLUMBING CODE:

11-18.1 2022 California Plumbing Code Adopted:

Except as provided in this chapter, the “2022 California Plumbing Code ”, based on the '2021 Uniform Plumbing Code' as published by the International Association of Plumbing and Mechanical Officials, is hereby adopted in its entirety as the Plumbing Code of the City of Lynwood, regulating erection, installation, alteration, repair, relocation, replacement, maintenance or use of plumbing systems within the City.

11-18.2 2022 California Plumbing Code Amendments:

[Reserved for future amendments]

SECTION 9. A new Section 11-21 is hereby added to Chapter 11 of the Lynwood Municipal Code to read as follows:

11-21
GREEN BUILDING STANDARDS CODE:

11-21.1 2022 California Green Building Standards Code Adopted:

Except as provided in this Chapter, the “2022 California Green Building Standards Code” is hereby adopted in its entirety and shall be and become the Green Building Standards Code of the City of Lynwood.

11-21.2 2022 California Green Building Standards Code Amendments:

[Reserved for future amendments]

SECTION 10. A new Section 11-22 is hereby added to Chapter 11 of the City of Lynwood Municipal Code to read as follows:

11-22

ENERGY CODE

City Council Regular Meeting - Page 144 of 1385
7 11-22.1 2022 California Energy Code Adopted:

Except as provided in this chapter, the “2022 California Energy Code,” is hereby adopted in its entirety and shall be and become the Energy Code of the City of Lynwood, regulating erection, installation, alteration, repair, relocation, replacement, maintenance or use of energy systems.

11-22.2 2022 California Energy Code Amendments:

[Reserved for future amendments]

SECTION 11. A new Section 11-23 is hereby added to Chapter 11 of the City of Lynwood Municipal Code to read as follows:

11-23
PROPERTY MAINTENANCE CODE:

11-23.1 2021 International Property Maintenance Code Adopted:

The “International Property Maintenance Code, 2021 Edition ”, as published by the International Code Council, is hereby adopted in its entirety as the Property Maintenance Code of the City of Lynwood, regulating and controlling the conditions and maintenance of all property, buildings and structures; providing the standards for supplied utilities and facilities and other physical things and condition s essential to ensure that structures are safe, sanitary and fit for occupation and use; and the condemnation of buildings and structures unfit for human occupancy and use, and the demolition of such existing structures as herein provided; providing for the issuance of permits and collection of fees therefor; provided, however, that notwithstanding the adoption of this code, the City may utilize and enforce any other provision of any code of the City relating to property maintenance."

11-23.2 2021 International Property Maintenance Code Amendments:

[Reserved for future amendments]

SECTION 12. A new Section 11-24 is hereby added to Chapter 11 of the City of Lynwood Municipal Code to read as follows:

11-24
HISTORICAL BUILDING CODE:

11-24.1 2022 California Historical Building Code Adopted:

Except as provided in this Chapter, the “2022 California Historical Building Code ” is hereby adopted in its entirety and shall be and become the Historical Building Code of the City of Lynwood, regulating for the preservation, restoration, rehabilitation, relocation City Council Regular Meeting - Page 145 of 1385
8 or reconstruction of buildings or properties designated as qualified hi storical buildings or properties.

11-24.2 2022 California Historical Building Code Amendments:

[Reserved for future amendments]

SECTION 13. A new Section 11-25 is hereby added to Chapter 11 of the City of Lynwood Municipal Code to read as follows:

11-25
EXISTING BUILDING CODE:

11-25.1 2022 California Existing Building Code Adopted:

Except as provided in this Chapter, the “2022 California Existing Building Code”, is hereby adopted in its entirety and shall be and become the Existing Building Code o f the City of Lynwood, regulating the alteration, repair, addition and change of occupancy of existing structures.

11-25.2 2022 California Existing Building Code Amendments:

[Reserved for future amendments]

SECTION 14. A new Section 11-26 is hereby added to Chapter 11 of the City of Lynwood Municipal Code to read as follows:

11-26
SWIMMING POOLS:

11-26.1 2021 International Swimming Pool and Spa Code Adopted:

Except as provided in this Chapter, the “2021 International Swimming Pool and Spa Code”, is hereby adopted in its entirety and shall be and become the Swimming Pool and Spa Code of the City of Lynwood, regulating the design, construction, alteration, movement, renovation, replacement, repair and maintenance of swimming pools, spas, hot tubs, aquatic facilities and related equipment in Lynwood.

11-26.2 2021 International Swimming Pool and Spa Code Amendments:

SECTION 305.2 (a) CONSTRUCTION PERMIT; SAFETY FEATURES REQUIRED ADDED

305.2 (a) Construction permit; safety features required.

City Council Regular Meeting - Page 146 of 1385
9 (a) Except as provided in Section AV100.5, when a building permit is issued for the construction of a new swimming pool or spa or the remodeling of an existing swimming pool or spa at a private single-family home, the respective swimming pool or spa shall be equipped with item # 1 and at least one additional of the following seven drowning prevention features:

1. An enclosure that meets the requirements of AV100.3 and isolates the swimming pool and spa from the private single-family home. Any walls of the residential structure or accessory structures used to complete the isolation enclosure must have door openings equipped with protection as required in AV100.2 (a)4 or (a)5. Any such door protection device provided for this purpose may not be used to comply with the second drowning prevention feature requirement.

2. Removable mesh fencing that meets American Society for testing and materials (ASTM) Specifications F2286 standards in conjunction with a gate that is self-closing and self-latching and can accommodate a key lockable device. The mesh fencing shall be not less than 20 inches from the water's edge.

3. An 'approved safety pool cover,' as defined in section AV100.1

4. Exit alarms on the private single-family home's doors that provide direct access to the swimming pool or spa. The exit alarm may cause either an alarm noise or a verbal warning, such as a repeating notification that "the door to the pool is open.

5. A self-closing, self-latching device with a release mechanism placed no lower than 54 inches (1372 mm) above the floor on the private single-family home 's doors providing direct access to the swimming pool or spa.

6. An alarm that, when placed in a swimming pool or spa will sound upon detection of accidental or unauthorized entrance into the wa ter. The alarm shall meet and be independently certified to the ASTM standard F2208 "Standard Safety Specification for Residential Pool Alarms." Which includes surface motion, pressure, sonar, laser and infrared type alarms. A swimming protection alarm fea ture designed for individual use, including an alarm attached to a child that sounds when the child exceeds a certain distance or becomes submerged in water, is not a qualifying drowning prevention safety feature.

7. Other means of protection, if the degree of protection afforded is equal to or greater than that afforded by any of the features set forth above and has been independently verified by an approved testing laboratory as meeting standards for those features established by the ASTM or that American Society of Mechanical Engineers (ASME).

(b) Before the issuance of a final approval for the completion of permitted construction or remodeling work, the local building code official shall inspect the drowning safety prevention features required by this section and, if no violations are found, shall give final approval.

City Council Regular Meeting - Page 147 of 1385
10 Authority: Health and Safety Code Section 18942 (b)
Reference: Health and Safety Code Section 115922; Chapter 925, Statutes of 1996; Chapter 478, Statutes of 2006; Chapter 670, Statutes 2017

SECTION 305.2 (b) ENCLOSURE; REQUIRED CHARACTERISTICS. AN ENCLOSURE SHALL HAVE ALL OF THE FOLLOWING CHARACTERISTICS ADDED

305.2 (b) Enclosure; required characteristics. An enclosure shall have all of the following characteristics. An enclosure shall have all of the following characteristics:

1. Any access gates through the enclosure open away from the swimming pool and are self-closing with a self -latching device placed no lower than 60 inches (1524 mm) above the ground.

2. A minimum height of 60 inches ((1524 mm).

3. A maximum vertical clearance from the ground to the bottom of the enclosure of 2 inches (51 mm).

4. Gaps or voids, if any, do not allow passage of a sphere equal to or greater than 4 inches (102 mm) in diameter.

5. An outside su rface free of protrusions, cavities or other physical characteristics that would serve as handholds or footholds that could enable a child below the age of five years to climb over.

Authority: Health and Safety Code Section 18942 (b)
Reference: Health and Safety Code Section 115922; Chapter 925, Statutes of 1996; Chapter 478, Statutes of 2006; Chapter 670, Statutes 2017

Section 305.2.1 BARRIER HEIGHT AND CLEARANCES - DELETED Section 305.3 GATES- DELETED"

SECTION 15. Penalties.

It shall be unlawful for any person, firm, partnership, or corporation to violate any provision or to fail to comply with any of the requirements of this Ordinance or any of the Codes hereby adopted. Unless deemed to be an infraction, any person, firm, par tnership or corporation violating any provision of this Ordinance or any of the Codes hereby adopted or failing to comply with any of their requirements shall be deemed guilty of a misdemeanor and subject to the penalties set forth under Lynwood Municipal Code Section 1 -5, including but not limited to any administrative citations or nuisance abatement proceeding . Alternatively, or in addition to the foregoing, violation of this Ordinance or the Codes adopted hereby may be punishable by administrative penalty.

City Council Regular Meeting - Page 148 of 1385
11 SECTION 16. CEQA Findings. The City Council hereby finds and determines that this Ordinance is not subject to the California Environmental Quality Act (Public Resources Code Section 21000, et seq.) (CEQA) pursuant to Section 15061(b)(3) of the State CEQA Guidelines because there is no possibility that it may have a significant effect on the environment.

SECTION 17. Severability. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of any competent jurisdiction, such decision shall not affect the validity of the re maining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portio n of the Ordinance would be subsequently declared invalid or unconstitutional.

SECTION 18. Filing. The City Clerk shall file a certified copy of this Ordinance with the California Building Standards Commission.

SECTION 19. Effective Date. The City Cler k shall certify to the passage of this Ordinance and shall cause this Ordinance to be published and/or posted as required by law and said Ordinance shall become effective on January 1, 2023.

PASSED, APPROVED AND ADOPTED this ____ day of ________ 2022.

________________________________
Jorge Casanova, Mayor

ATTEST:

_______________________________
Maria Quinonez, City Clerk

APPROVED AS TO FORM APPROVED AS TO CONTENT

_______________________________ ________________________________ Noel Tapia, City Attorney Ernie Hernandez, City Manager City Council Regular Meeting - Page 149 of 1385
12 STATE OF CALIFORNIA )
) §

COUNTY OF LOS ANGELES )

I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the above and foregoing Ordinance was duly adopted by the City Council of the City of Lynwood at a regular meeting held in the City Hall of said City on the _______ day of __________, 2022, and passed by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

_______________________________
Maria Quinonez, City Clerk
City Council Regular Meeting - Page 150 of 1385
Agenda Item # 19.

AGENDA STAFF REPORT
DATE: December 20, 2022
TO: Honorable Mayor and Members of the City Council
APPROVED BY: Ernie Hernandez, City Manager
PREPARED BY: Julian Lee, Director of Public Works George Cambero, Interim Utility Manager SUBJECT: AWARD OF CONTRACT TO ROBERT D. NIEHAUS, INC. TO PREPARE THE 2023WATER AND SEWER RATES STUDY Recommendation:

Staff recommends that the City Council adopt the attached resolution entitled: “A RESOLUTION OF THE CITYCOUNCIL OF THE CITY OF LYNWOOD AWARDING AN AGREEMENT TO ROBERT D. NIEHAUS, INC.TO PREPARE THE 2023 WATER AND SEWER RATES STUDY; AUTHORIZING THE MAYOR TOEXECUTE AN AGREEMENT IN AN AMOUNT NOT TO EXCEED $89,900; AND AUTHORIZING THE CITYMANAGER TO APPROVE UP TO TEN PERCENT OF THE CONTRACT PRICE FOR ADDITIONALSERVICES AS NEEDED." Background:

The City collects revenues that are intended to be sufficient to cover the costs of operating the water and sewersystems. These revenues allow the City to protect public health; and safely and reliably treat and convey water andsewer. The last increase to the water and sewer rates was adopted by the City Council on April 18, 2017, whichset forth rates for Fiscal Year (FY) 2017 to FY 2021. The City will need to undertake a comprehensive cost of water and sewer service study to meet substantiverequirements of Proposition 218 (Prop 218). On November 3, 2022, staff issued a Request for Proposals (RFP)from qualified consulting firms to prepare a comprehensive water and sewer rate study and to develop a 5-Yearrate structure that meets the Prop 218 requirements. The RFP was advertised on PlanetBids, the City’s e-bidbidding platform. On November 29, 2022, the City received proposals from seven firms: Bartle Wells Associates,Black & Veatch Management Consulting, LLC, HG&H Consultants, LLC, NewGen Strategies and Solutions,LLC, Raftelis Financial Consultants, Inc., Robert D. Niehaus, Inc. (RDN), and Willdan Financial Services.

Discussion and Analysis:

City Council Regular Meeting - Page 151 of 1385
The 5-Year Rate Increases adopted in 2017 was supported by a study that the City commissioned from Black andVeatch. Conditions have changed since that study. To name a few, Central Basin Municipal Water District hasincreased its water rates and charges, the City has refunded and issued utility bonds, Covid-19, and increasingregulatory requirements. In addition, the infrastructure has continued to age. To adequately maintain and operatethe water and sewer systems and avoid dramatic hikes in water and sewer rates, staff recommends that a waterand sewer rates study be conducted to identify revenue requirements as well as provide recommendations on thecurrent rate structure. Water and Sewer Systems The City’s water service area is approximately 4.84 square miles in size and covers approximately 95 percent ofthe land within City’s municipal boundaries. Liberty Utilities provides water service to the remaining 5 percent inthe southeast section of the City’s municipal boundaries. Most of the consumption is in the residential sector,although the largest individual water users include industry, government, and other institutions. Water supply for thesystem is derived from local wells and is supplemented by emergency potable water deliveries from theMetropolitan Water District of Southern California. The City has approximately 517,270 feet (or 98 miles) ofdistribution pipelines. The City’s water supply facilities include five (5) groundwater production wells, three (3)booster pumps, one (1) partially buried concrete reservoir, and imported and emergency water connections. In addition to the water system, the City owns and operates its local sanitary sewer system consisting ofapproximately 81 miles of gravity flow sewer pipelines, 1 lift station and 1,704 manholes. The City manages thesanitary sewer collection system facilities to ensure that they are properly operated, maintained, and managed toreduce frequency and severity of sanitary sewer overflows (SSO) and their potential impacts on public health,safety, and on the environment. It is the City’s responsibility to ensure that the sewer system is adequatelydesigned, constructed and funded to provide adequate capacity while meeting or exceeding applicableregulations, laws and the generally acceptable practices relative to sanitary sewer system operations andmaintenance. Self-Supporting Enterprise The water and sewer systems are intended to be self-supporting. As such, the water and sewer rates aredeveloped to provide sufficient levels of revenue to meet all operation and maintenance expenses, debt servicerequirements, routine replacements of capital improvements, and other revenues requirements. The water andsewer rates study will provide the City with financial plan projecting revenues, expenses and capital financing. Thisis a highly technical study requiring specialized skills and competency to gather, characterize, and synthesize waterand sewer related information into a financial plan that will withstand Prop 218 challenges. Proposals from Consulting Firms Staff reviewed the written proposals received from Bartle Wells Associates, Black & Veatch ManagementConsulting, LLC, HG&H Consultants, LLC, NewGen Strategies and Solutions, LLC, Raftelis FinancialConsultants, Inc., Robert D. Niehaus, Inc. (RDN), and Willdan Financial Services. (See Attachment A for theproposals) Each written proposal was scored on the following criteria: 1) project understanding and project approach, 2) firmsexperience, 3) qualifications, 4) references, and 5) project schedule, 6) fee proposal. Attachment B shows thescoring results for each firm based on the written proposal’s evaluation criteria and interview. The table belowsummarizes the average score given to each of the firm: Ranking Firm AverageScore Fee Schedule 1 Robert D. Niehaus, Inc. (RDN) 94 $89,900.002 Raftelis Financial Consultants, Inc. 92 $131,913.003 Bartle Wells Associates 90 $119,630.004 HF&H Consultants, LLC 81 $159,770.005 Black & Veatch Management Consulting, LLC 79 $98,755.006 Willdan Financial Services 78 $55,625.007 NewGen Strategies and Solutions, LLC 76 $98,950.00 City Council Regular Meeting - Page 152 of 1385
Recommended Firm to Award: Robert D. Niehaus, Inc. RDN received the highest average score based on their written proposal and performance upon review. Allproposing companies have demonstrated experience in preparing multiple water/sewer rates studies. The panelfeels that RDN edged the others firms overall. RDN is an economic and financial consulting firm that provides rate – and fee-setting consulting services toCalifornia water and wastewater utilities. Their staff has completed over 700 projects with economic, financial, andmarket analysis experience across California and worldwide since the firm’s founding in 1983. Their proposedproject team has over 100 years of combined public-sector consulting experience. RDN has partnered with Mr. Sanjay Gaur of Water Resources Economics, who will serve as a Senior Advisor. Mr.Gaur is a leading expert in California water utility financial planning and rate design and is particularly known forhis work helping agencies prepare for customer outreach and regulatory compliance. This item is of greatimportance to the rating team and for the process of final acceptance of the study. For public outreach, RDN will help build community consensus by engaging stakeholders throughout the studyprocess, especially at the two community workshops. The public outreach lead will be sub-consultant, Sanjay Gaur,assisted by the Project Manager, Anthony Elowsky. Sanjay and Anthony will also host a workshop with CityCouncil to build consensus on policy objectives for the study. The goal is to bring forth the financial plans for each utility and demonstrate City transparency and the rating teambelieves that RDN is the best qualified firm to meet the stated tasks, timeline, and objectives of the RFP. Robert D. Niehaus, Inc. did not submit the lowest cost proposal. Pursuant to the Lynwood Municipal CodeSection 6-3.9(b) price is not the sole factor in determining to whom a contract shall be awarded for theprocurement of professional services.

Fiscal Impact:

The Project has an approved FY23 Budget of $112,000.00. No additional funding is needed. The table below isthe proposed project budget and funding details. RDN Proposal Amount $89,900.0010% Contingency $8,990.00Project Management (10%) $8,990.00Labor Compliance & Other Cost (4.6%) $4,120.00Total Estimated Project Cost $112,000.00 Water Fund (6051-45-450-62015) $85,000.00Sewer Fund (6401-45-460-62015) $27,000.00FY23 Approved Budget $112,000.00

Coordinated With:

City Manager’s OfficePublic Works DepartmentDepartment of Finance and Administration Services City Council Regular Meeting - Page 153 of 1385
ATTACHMENTS:Description
12-20-22 Water Sewer Rate Study (Resolution) Final
Attachment A1 - All Proposals
Attachment A2 - All Proposals
Attachment A3 - All Proposals
Attachment A4 - All Proposals
Attachment B
City Council Regular Meeting - Page 154 of 1385
RESOLUTION._____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AWARDING AN AGREEMENT TO ROBERT D. NIEHAUS, INC. TO PREPARE THE 2023 WATER AND SEWER RATES STUDY; AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT IN AN AMOUNT NOT TO EXCEED $89,900;

AND AUTHORIZING THE CITY MANAGER TO APPROVE UP TO TEN

PERCENT OF THE CONTRACT PRICE FOR ADDITIONAL SERVICES AS NEEDED

WHEREAS, the City collects revenues that are intended to be sufficient to cover the costs of operating the water and sewer systems; and

WHEREAS, these revenues allow the City to protect public health; and safely and reliably treat and convey water and sewer; and

WHEREAS, the City will need to undertake a comprehensive cost of water and sewer service study to meet substantive requirements of Proposition 218 (Prop 218); and

WHEREAS, a comprehensive water and sewer rates study is a highly technical study to prepare requiring specialized skills and competency to gather, characterize, and synthesize water/sewer related information into a financial plan that will withstand Prop 218 challenges; and

WHEREAS, on November 3, 2022 , staff issued a Request for Proposals from qualified consulting firms to prepare a comprehensive water and sewer rate study and to develop a 5 -Year Rate structure that meets the Prop 2 18 requirements; and

WHEREAS, on November 29, 2022, the City received proposals from seven firms: Bartle Wells Associates, Black & Veatch Management Consulting, LLC, HG&H Consultants, LLC, NewGen Strategies and Solutions, LLC, Raftelis Financial Consultants, Inc., Robert D. Niehaus, Inc. (RDN), and Willdan Financial Services; and

WHEREAS, Robert D. Niehaus, Inc. (RDN) will ensure the necessary depth and breadth of expertise needed to prepare a comprehensive water and sewer rates study that meets the substantive requirements under Prop 218.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LYNWOOD DOES HEREBY FIND, PROCLAIM, ORDER AND RESOLVE AS FOLLOWS:

Section 1. That the City Council approves to award an agreement to Robert D. Niehaus, Inc. (RDN) to prepare a water and sewer rates study for a not to exceed amount of $89,900 and authorizes the Mayor to execute an Agreement attached hereto as Exhibit A in a form approved by the City Attorney.

City Council Regular Meeting - Page 155 of 1385
2 Section 2. That the City Council approves the following appropriation:

APPROPRIATION
Fund Dept Div Object Description Amount
6051 45 450 62015 Water Fund -
Professional/Contractual Services
$85,000.00
6401 45 460 62015 Sewer Fund -
Professional/Contractual Services
$27,000.00

Section 3. That the City Council authorizes the City Manager to approve additional services for a not to exceed amount of 5% of the contract price.

Section 4. That the City Council authorizes the City Attorney to negotiate the final form of the Agreement.

Section 5 . That this Resolution shall take effect immediately upon its adoption.

Section 6. That the City Clerk shall certify to the adoption of this Resolution.

PASSED, APPROVED and ADOPTED this 20th day of December 2022.

______________________________
Oscar Flores
Mayor
ATTEST:

___________________________ ______________________________ María Quiñónez Ernie Hernandez
City Clerk City Manager

APPROVED AS TO FORM: APPROVED AS TO CONTENT:

__________________________ ______________________________ Noel Tapia Julian Lee
City Attorney Director of Public Works

City Council Regular Meeting - Page 156 of 1385
3 STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

AYES:

NOES:

ABSTAIN:

ABSENT:

________________________
Maria Quiñónez, City Clerk

STATE OF CALIFORNIA )
)

COUNTY OF LOS ANGELES )

________________________
Maria Quiñónez, City Clerk

City Council Regular Meeting - Page 157 of 1385

Water and Sewer
Rate Study Proposal
November 29, 2022
City Council Regular Meeting - Page 158 of 1385

November 29, 2022

City of Lynwood
11330 Bullis Road
Lynwood, CA 90262

Attn: Kristan Lloyd

Re: Proposal for Water and Sewer Rate Study

Bartle Wells Associates (BWA) is pleased to submit this proposal to the City of Lynwood (City). For more than 50 years, our firm has specialized in providing independent financial and utility rate consulting services to California water and wastewater agencies. We offer an unmatched level of financial planning expertise and are the only firm in California to provide both financial advisory services for project financing as well as utility rate consulting services.

Bartle Wells Associates was established in 1964. We have served over 600 public agencies from all areas of California. Our clients have ranged from small cities and districts to large citi es, special districts, joint power authorities, and counties. We have helped a number of agencies develop strategic financial plans to address escalating costs of operating expenses a nd long-term infrastructure needs. We have also helped many agencies modify their existing rate structures to provide a better balance of revenue stability and conservation incentive. Our rate studies are ba sed on a comprehensive analysis of each agency’s customer base, consumption patterns, and demands to ensure rate structure recommendations reflect local needs and objectives.

Our proposal includes a description of our firm, resumes, our project approach, experience, scope of work, and schedule. We are very interested in working with the City on this project and hope this proposal provides a suitable basis for our selection.

Sincerely,

Douglas Dove,
PE, CIPMA Erik Helgeson, MBA
Principal/ President Vice President

2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel 510 653 3399
www.bartlewells.com
City Council Regular Meeting - Page 159 of 1385

Table of Contents

EXECUTIVE SUMMARY ........................................................................................ 1 Project Understanding & Objectives ....................................................................................................... 1 Collaborative Project Approach & Process .............................................................................................. 1 City’s Professional Services Agreement ................................................................................................... 2 Legal Issues .............................................................................................................................................. 2 Disclosures ............................................................................................................................................... 2 Bartle Wells Associates Contact Information .......................................................................................... 2 SECTION 2: APPROACH TO THE PROJECT ............................................................ 3 Phase 1. Project Initiation & Data Collection ........................................................................................ 3 Phase 2. 10-Year Financial Plans ............................................................................................................ 4 Phase 3. Cost of Service Rate Analysis ................................................................................................... 5 Phase 4. Capacity Fee Updates .............................................................................................................. 7 Phase 5. Reports, Presentations, Model and Rate Implementation ..................................................... 8 SECTION 1: EXPERIENCE AND QUALIFICATIONS ................................................. 9 BARTLE WELLS ASSOCIATES ..................................................................................................................... 9 PROJECT TEAM ....................................................................................................................................... 11 RESUMES ................................................................................................................................................ 12 SECTION 4: REFERENCES ................................................................................... 18 SECTION 5: PROJECT SCHEDULE ....................................................................... 21 SCHEDULE OF INSURANCE ................................................................................. 22 MUNICIPAL ADVISOR DISCLOSURES .................................................................. 23

Attachment A - Example Rate Study

City Council Regular Meeting - Page 160 of 1385

BARTLE WELLS ASSOCIATES Page 1
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Executive Summary

Project Understanding & Objectives
 Water and Wastewater Rate Study: BWA will develop a comprehensive water and sewer rate study with the goal of helping the City implement a series of rates for upcoming years that a) fund the City’s projected costs of providing service, b) maintain financial stability, and c) are fair to all customers. Our general rate study process is summarized in the following graphic:

 Water & Sewer Connection Fee Updates: Update the City’s water and sewer connection fees. A goal of this task will be to develop new connection fees that fully recover the cost of facilities and assets benefitting new development. Connection fees may recover costs for buying in to existing assets as well as the estimated costs of future facilities that w ill provide benefit to growth. Updated fees will be designed to equitably recover costs based on each new or expanded connection’s capacity needs and comply with California Government Code 66013.
 Build Consensus for Final Recommendations: BWA has a strong track record of building consensus and public acceptance for final recommendations. Rate and fee adjustments can be controversial. We have found that ratepayers are more accepting of rate increases when they both understand the need for the increases and believe they are being treated fair ly. BWA will draft the required Proposition 218 rate notice, present a summary of recommendations at the required Public Rate Hearing, and can assist with public outreach efforts. Our goal will be to build consensus and public acceptance for final recommendations.

Collaborative Project Approach & Process
BWA uses a collaborative project approach to ensure final recommendations reflect the policy preferences and objectives of the agencies we serve. Our general approach will be to work closely with the City’s project team to identify objectives, evaluate alternatives and their impacts, gain ongoing input, and remain flexible to resolve unanticipated issues.

BWA will assist the City in all phases of the study, from project initiation through final adoption and implementation. Rate and fee increases can be controversial. BWA has extensive experience helping agencies build consensus for final recommendations and has assisted many agencies with public outreach efforts aimed at fostering understanding and acceptance for rate and fee increases. BWA also has Project Initiation 10-Year Financial
Plan
Cost of Service
Rate Design
Outreach &
Adoption
Rate Study Process
Clarify Objectives
Establish Process/Schedule
Review Data & Assumptions
Financial Projections
Financing Alternatives
Evaluate Scenarios
Analyze Billing Data
Evaluate Rate Alternatives
Cost Allocation & Rate Design
Build Consensus
Public Education
Proposition 218 Process
City Council Regular Meeting - Page 161 of 1385

BARTLE WELLS ASSOCIATES Page 2
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal substantial experience working with citizen advisory groups, community groups, and other stakeholders, and has a long track record of completing projects on time and on budget. We have helped many agencies successfully adopt rate increases in challenging political environments.

City’s Professional Services Agreement
BWA is able and willing to sign the City’s Professional Services Agreement.

Legal Issues
BWA, its principals, and its consultants have not had legal issues.

Disclosures
BWA, its principals and its consultants have not been the subject of an investigation by the County, State, and/or Federal agencies within the past five years.

Bartle Wells Associates Contact Information

Bartle Wells Associates
2625 Alcatraz Ave #602
Berkeley, CA 94705

BWA Contact & Project Manager
Erik Helgeson, MBA
Tel: (510) 671-8669
E-mail: [email protected]

Bartle Wells Associates was established in 1964 and is a wholly owned California Corporation and certified State of California Small Business. Our Federal Tax ID number is 94-1664409 City Council Regular Meeting - Page 162 of 1385

BARTLE WELLS ASSOCIATES Page 3
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Section 2: Approach to the Project

This section presents a draft work plan and scope of services that we believe forms a sound basis for completing a comprehensive Water and Wastewater Cost of Service Study. Bartle Wells Associates can work with the City to finalize a scope of services that meets the City's objectives. Our general project approach is to work closely with staff and other members of the project team, identify objectives, set milestones, have frequent communication, and remain flexible to resolve unanticipated issues.

Phase 1. Project Initiation & Data Collection

1. Project Team Orientation
To initiate our work, hold a meeting with City staff and others as appropriate, to accomplish the following:
 Identify members of City staff, City Council, engine ering consultants, and others who will participate in the project.
 Determine the roles and responsibilities of all project participants.  Identify other parties that may a significant interest in the project, such as community groups, business organizations, developers, and large customers.
 Establish project schedule and key milestone dates.
 Confirm the key goals and expectations of the project team.

BWA recommends holding the kickoff meeting after we have reviewed preliminary information. This will enable the kickoff meeting to be more substantive and facilitate more in-depth discussion of key issues and preliminary observations and potential alternatives.

2. Investigation and Data Collection
Assemble the information necessary to understand the City’s water and sewer systems, finances, customers and usage, rate and fee structures, capital improvement ne
eds and alternatives, and legal agreements. Assistance and cooperation of City staff will be needed to assemble the relevant background information. The objectives of investigation and data collection are to develop a complete understanding of the City’s utilities and finances, and to reach an agreement on basic assumptions to be used in the study as well as key alternatives for evaluation.

3. Evaluate Overhead Distribution Formulas
Evaluate the existing overhead distribution formulas and develop recommendations that will improve equity in the application of overhead between the water and sewer enterprises and among the various water classifications in the water enterprise fund.

4. Evaluate Customer Service Fee Structure
Assess existing customer service fee structure and identify other potential areas for service and system charges (shut-down activities, back-flow devices, plan reviews, water and sewer se rvice shut-offs, etc.) and recommend changes, if appropriate. Assessment is to note any resulting increase in liability the City may incur as a result of assessing the fees.

Phase 1 Deliverables Include:
 Project kickoff meeting
 Identification of key issues, project goals and objectives  Project schedule and budget
 Project team contact list
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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Phase 2. 10-Year Financial Plans

1. Develop Forecasts and Projections
Based on evaluation of the data assembled and input
provided by the City, prepare forecasts and projections to be used in the development of financial models for the
City’s water and sewer utilities. Develop projections for the following areas (and others as appropriate). Review
projections and alternatives with City staff for agreements on assumptions, interpretation of data, and completeness of approach.

 Capital Improvements Including Long-Term Repairs &
Replacements: Based on input from City staff, identify future capital improvement program costs or
alternatives to include in the financial analysis and
determine a reasonable amo unt to include for future,
ongoing capital repairs and replacements. BWA often
recommends that agencies phase in funding for long-
term system rehabilitation.

 Projected Water and Sewer Demand: With City input, forecast water and sewer demand. Identify future demand scenarios for evaluation.

 Growth & New Development: Work with the City to identify levels of growth to incorporate in the financial projections. Evaluate financial impacts under different levels of growth.

 Cost Escalation Factors: Review historical cost trends and work with project team to develop reasonable cost escalation factors for both operating and capital expenditures. Work with City staff to identify any anticipated changes in future staffing, benefits, and/or other operating costs.

2. Evaluate Financing Alternatives for Capital Improvements Evaluate options for financing capital improvement projects. Our evaluation will:
 Allocate capital improvement costs to existing cu stomers and new development based on the share of each project benefitting current vs. future customers.
 Estimate the amount and timing of any debt, if needed, to finance capital projects.  Evaluate the alternative borrowing methods available including bonds, COPs, state and federal loan programs (including the State Revolving Fund Financing Program), bank loans and lines of credit, and other options.
 Recommend the appropriate type of debt, its term and structure.  As needed, develop debt service estimates to incorporate in the financial projections.

3. Establish Prudent Minimum Fund Reserve Targets
Evaluate the adequacy of the City’s current utility fund reserves. Establish prudent minimum fund reserve targets based on the City’s operating and capital funding projections. Develop an implementation plan for achieving and maintaining the recommended reserve fund levels.

4. Develop 10-Year Financial Projections & Evaluate Scenarios Develop 10-year cash flow projections showing the fina ncial position of the water and sewer utilities over the next 10 years. The cash flows will project fund balances, revenues, expenses, and debt service coverage, and will incorporate the forecasts developed with staff input. After developing a base-case cash flow The 10-year financial plans will
serve as financial roadmaps for
funding future operating and
capital programs while
supporting long-term financial
stability.

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal scenario, we can model alternatives for additional evaluation such as capital improvement alternatives, project financing alternatives, the impacts of various levels of water demand, etc. During this phase, BWA will work closely with the project team to evaluate financial and rate projections under alternative scenarios.

5. Evaluate Rate Increase Options
Based on the cash flow projections, determine future annual revenue requirements from rates and project the overall level of required rate increases. Evaluate rate adjustment alternatives, such as gradually phasing in required rate increases over a number of years. If appropriate, evaluate different levels of rate increases and their impacts on the City’s ability to fund future operating and capital needs.

Phase 3. Cost of Service Rate Analysis

1. Identify & Evaluate Water and Sewer Rate Structure
Alternatives
Review the City’s current wate r and sewer rate structures and discuss advantages and disadvantages compared to
other rate approaches. Identify potential alternatives and modifications that could help improve rate equity, address City concerns, or help achieve other City objectives. Discuss pros and cons of different rate structure options and their general impacts on different types of customers. Rate
structure options can be refi ned as the study progresses based on input from the project team.

2. Conduct Survey of Regional Utility Rates
Review and summarize water and sewer rates of other
regional agencies. Summarize results in easily
understandable tables and/or charts.

3. Analyze Consumption & Utility Billing Data
Analyze current and historical usage and utility bi lling data to determine reasonable and conservative estimates of water and sewer demand to use in develo ping financial projections and rates. Water use can fluctuate from year to year depending on various factors such as weather and local and regional conservation efforts. Ideally, we would prefer to analyze multiple years of utility billing data in order to determine slightly conservative demand projections and evaluate water and sewer demands under various normal year and water shortage scenarios.

Phase 2 Deliverables Include:
 Summary of 10-year capital improvement plans and/or key alternatives  Evaluation of financing alternatives for capital improvements  Minimum fund reserve target recommendations
 10-year financial projections with supporting tables
 Evaluation of alternative scenarios as needed
 Evaluation of rate increase options
 Meet with the City’s project team to present findings, discuss alternatives, and gain input Rates will be developed based
on a cost-of-service approach
designed to equitably recover
the cost of providing service
to all customers and comply
with Proposition 218.

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

4. Cost of Service Rate Derivation
BWA has helped many agencies develop utility rates designed to reflect the costs of providing service, be fair and equitable to all customers, and comply with Prop osition 218 and other legal requirements. In recent years, we have worked collaboratively with a number of legal experts to ensure our recommendations account for the latest legal understand ing of Proposition 218. For this task, we will derive proposed rates based on a defensible cost of service methodology. A key component of this task includes allocating operating, maintenance, capital, and debt service expenses for cost recovery from appropriate rate components. Water rates will be based on a) an alloca tion of costs to be recovered from fixed vs. variable charges, b) a cost-based justification to support the Ci ty’s residential rate tiers, and c) a separate cost justification for budget-based irrigation rates. Sewer ra tes will be based on cost allocations to wastewater flow and strength (as measured by BOD and SS) in orde r to develop underlying unit costs for flow, BOD and SS. These unit costs are then applie d to the wastewater discharge characte ristics of each customer class to ensure rates reflect the proportional cost of providing service to each class.

5. Develop Preliminary & Final Rate Recommendations with City Input Based on evaluation of rate structure alternatives and the overall level of rate increases identified in the financial plans, develop draft rate recommendations for City input. The recommendations may include a multi-year phase in of both overall rate increases and proposed rate structure adjustments in order to help mitigate the annual impact on ratepayers. Review preliminary recommendations and key alternatives with the City Council’s Utilities Committee and others as directed. Revise recommendations based on input received. Final rate recommendations will be designed to:
a) fund each utility’s long-term costs of providing serv ice, including operating, capital, and debt service funding needs
b) be fair and equitable to all customers,
c) provide a prudent balance of cons ervation incentive and revenue stability, d) be easy to understand and administer, and
e) comply with the substantive requirements of Proposition 218.

6. Evaluate Use of Automatic Rate Pass-Throughs
Identify and evaluate the potential for implementing automatic pass-throughs for future wholesale rate increase and/or ongoing cost inflation. BWA has he lped many agencies implement pass-through provisions to protect agencies against unanticipated wholesale cost increases and keep rates aligned with the cost of providing service.

7. Evaluate Rate Impacts on a Range of City Customers
Calculate the impacts of each rate alternative on a range of City customers Discuss additional rate structure adjustments that may reduce the impact on certain customers if warranted.

Phase 3 Deliverables Include:
 Evaluation of current utility rates and potential rate structure modifications  Regional utility rate surveys
 Analysis of historical consumption and utility billing data  Cost of service analysis to support equitable and legally-defensible rates  Development of draft rate alternatives for City evaluation and input  Meet with City to discuss findings and alternatives, gain input, and develop recommendations City Council Regular Meeting - Page 166 of 1385

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Phase 4. Capacity Fee Updates

1. Review Current Capacity Fees & Procedures for Applying Fees Review the City’s current water and sewer connection fees as well as related policies and procedures for applying the fees to new development. As appropriat e, identify potential modifications to the fees, fee structure, or how fees are applied. BWA has developed connection fees under a wide range of methodologies and has assisted many agencies in improving fee equity and administration.

2. Conduct Survey of Regional Connection Fees
Review and summarize connection fees of other regional
and comparable agencies. Summarize results in easily
understandable tables and/or charts.

3. Evaluate Alternative Connection Fee Methodologies
Identify and evaluate altern ative methods for calculating connection fees for new development. Discuss advantages and disadvantages with the City’s project team and
determine a recommended approach.

4. Determine Current Value & Capacity of Facilities
Calculate the value of the City’s sewer system assets.

Current value can be calculated by adjusting the original (or depreciated) value of each facility or asset into current dollars using the Engineerin g News-Record Construction Cost Index, a widely-used measure of construction cost
inflation. Also, determine the capacity of major
components of the recycled water and sewer systems.

5. Allocate Capital Program Costs to Current & Future Users Equitably allocate capital improvement costs to existi ng and future users based on input from City staff and/or its consulting engineers. Some projects may entirely benefit one group while others will provide a portion of benefit to both correct existing system deficiencies and provide new capacity for growth.

6. Develop Preliminary Connection Fee Recommendations
Based on appropriate and technically sound methodology, and evaluation of alternative approaches, recommend updated sewer connection fees. If applicab le, evaluate the potential for a separate recycled water connection fee. Updated fees will be design ed to comply with Government Code Section 66013 (established by AB1600).

7. Recommend a Method for Future Fee Updates
Recommend a method to annually or periodically adjust connection fees to keep the fees aligned with future costs. For example, connection fees can be adjusted annually based on the change in the Engineering News- Record’s Construction Cost Index, a widely used measure of construction cost inflation.

Phase 4 Deliverables Include:
 Evaluation of current water and wastewater capacity fees and procedures  Regional water and sewer capacity fee surveys
 Identification of alternative fee methodologies or approaches  Calculations of new water and sewer connection fees
 Meet with City to discuss findings and alternatives, gain input, and develop recommendations Connection fees will be
designed to recover the full
cost of infrastructure and
assets benefitting new
development and comply with
Government Code 66013.

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Phase 5. Reports, Presentations, Model and Rate Implementation

1. City Council Meetings/Rate Workshops (6 City Council Meetings/ Workshops/ Public Hearings) Attend a City Council Meeting to present findings, recommendations and alternatives, and receive input.

Incorporate input as warranted to ensure final recommendations reflect Council preferences. Present revised recommendations at a subsequent Council Meeting with the goal of gaining Council approval to move forward with the Proposition 218 process to adopt rate increases.

2. Water and Wastewater Financial Planning Models
BWA will provide user-friendly models customized to the needs of the City. BWA has developed numerous rate and financial models for utility enterprises. We have found that keeping a model as straightforward as possible, without unnecessary complexity, can increase the model’s usability and improve effectiveness as an in-house planning tool. BWA’s philosophy is that models should flow in a way that is easy to understand, be reliable, and provide relevant outputs.

3. Prepare Draft & Final Reports
Develop a draft report summarizing study objectives, findings and draft recommendations. The report will provide an administrative record supporting the proposed utility rates and connection fees and will be developed to demonstrate compliance with applicable legal requirements of Proposition 218, Proposition 26, and Government Code 66013. The report will be written for a non-technical audience and will clearly explain the rationale for recommendations and key alternatives when applicable. Submit a draft report for City review and feedback.

Incorporate input into a revised report and ultimately provide the City with printed and electronic copies as needed. The report will be provided in PDF format and can also be provided in editable Word and Excel files.

4. Proposition 218 Rate Notice
Develop a draft Proposition 218 notice for City review. Incorporate revisions and develop a final notice. BWA recommends the notice go beyond the minimum le gal requirements and provide clear and concise explanation of the reasons for any rate adjustments. BWA has help ed many agencies adopt rates via the Proposition 218 process. We have found that ratepayers are generally much more accepting of rate increases or rate structure modification when they understand the reasons underlying the adjustments. BWA also helps agencies coordinate the printing and mailing of the Proposition 218 notices and will remain available to assist the City with these services on a time and materials basis as needed.

5. Proposition 218 Rate Hearing
Attend the Proposition 218 Public Rate Hearing and re main available to present a summary of findings and recommendations and respond to Council and public co mments. BWA has extensive experience presenting financial and rate recommendations to non-technical audiences, dealing with challenging questions, and building acceptance for final recommendations.

6. Public Education and Consensus-Building
Rate and fee adjustments are often controversial. BWA has helped many agencies with their public education and outreach efforts regarding rate and fee increases. We understand the importance of building consensus and public acceptance for our recommendations and can assist the City in any outreach and public education efforts.

Phase 5 Deliverables Include:
 City Council Meetings/Rate Workshops
 Draft and final reports
 Draft of the required Proposition 218 Notice of proposed rate increases  Public Hearing
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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Section 1: Experience and Qualifications

BARTLE WELLS ASSOCIATES
Leaders in Water, Wastewater & Stormwater Rates and Finance Since 1964 Bartle Wells Associates (BWA) is an independent financial advisory firm with expertise in the areas of water, wastewater, and stormwater finance. BWA was estab lished in 1964 and has over 50 years of experience advising cities, special districts, and other agencies on the complexities and challenges in public finance. We have advised over 550 public agency cl ients throughout California and the western United States. We have a diversity of abilities and experience to evaluate all types of financial issues faced by local governments and to recommend the best and most-practical solutions.

Bartle Wells Associates has a highly qualified professional team of five consultants. Our educational ba ckgrounds include finance, civil engineering, business, public administration, public policy, and economics.

BWA specializes in three professional services: utility cost-of-service rate and fee studies, financial plans, and project financing. We are one of the few independent financial advisors providing all three of these interrelated services to public agencies.

RATE AND FEE STUDIES Our rate studies employ a cost-of-service approach and are designed to maintain the long-term financial health of a utility enterprise wh ile being fair to all customers. We develop practical recommendations that are easy to implement and often phase in rate adjustments over time to minimize the impact on ratepayers. We also have extensive experience developing impact fees that equitably recover the costs of infrastructure required to serve new development. BWA has completed hundreds of utility rate and fee studies. We have helped communities implement a wide range of rate structures and are knowledgeable about the legal requirements governing rates and impact fees. We develop clear, effective presentations and have represented public agencies at hundreds of public hearings to build consensus for our recommendations.

FINANCIAL PLANS Our financial plans provide agencies with a flexible roadmap for funding long-term operating and capital needs. We evaluate the wide range of financing options available, develop a plan that recommends the best financing approach, and clearly identify the sources of revenue for funding projects and repaying any debt. We also help agencies deve lop prudent financial policies, such as fund reserve targets, to support sound financia l management. BWA has developed ov er 2,000 utility enterprise financial plans to help public agencies fund their operating and capital programs, meet debt service requirements, and maintain long-term financial health.

PROJECT FINANCING Our project financing experience includes over 300 bond sales and numerous bank loans, lines of credit, and a range of state and federal grant and loan programs. We generally recommend issuing debt via a competitive sale process to achieve the lowest cost financing possible. To date, we have helped California agencies obtain over $5 billion of financing via bonds, bank loans/private placements, lines of credit, low-rate State Revolving Fund Loans, and other funding programs. We work only BWA Key Services

Rate & Fee Studies
Financial Plans
Project Financing
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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal for public agencies; we are independent financial adviso rs and do not buy, trade, or resell bonds. Our work is concentrated on providing independent advice that enables our clients to finance their projects on the most favorable terms—lowest interest rates, smallest issue size, and greatest flexibility.

Bartle Wells Associates is a charter member of the National Association of Municipal Advisors (NAMA), which establishes strict criteria for independent advisory firms. All of our lead consultants are Certified Independent Professional Municipal Advisors and are Registered Municipal Advisors.

Bartle Wells Associates is committed to providing value and the best advice to our clients. Our strength is quality— the quality of advice, service, and work we do for all our clients.

EXPERIENCE BWA has extensive experience developing long- term financial plans, utility rates, and capacity fees for public agencies from all areas of California and the western U.S. In recent years, we have completed assignments for many agencies including:

Sample Water/Sewer/ Stormwater Districts
 Fallbrook Public Utility District
 Pico Water District
 Big Bear City CSD
 Monterey One Water
 Marin Municipal Water District
 Ramona Municipal Water District
 San Diego County Water Authority
 Joshua Basin Water District
 Palmdale Water District
 South San Luis Obispo County Sanitation District
 Silicon Valley Clean Water
 Victor Valley Wastewater Reclamation Authority
 Santa Ynez River Water CD, ID#1
 Cucamonga Valley Water District
 San Miguel Community Services District
 Big Bear Area Regional Wastewater Agency
 Sonoma County Water Agency
 Helix Water District
 Lake Arrowhead Community Services District
 Indian Wells Valley Water District
 East Bay Municipal Utility District
 West Valley Sanitation District
 San Francisco Public Utilities Commission
Sample Cities
 City of Santa Barbara
 City of San Clemente
 City of Hemet
 City of Fresno
 City of Palm Springs
 City of Poway
 City of Paso Robles
 City of Benicia
 City of Imperial
 City of Port Hueneme
 City of Redwood City
 City of Hesperia
 City of Glendale
 City of Solvang
 City of Brawley
 Foresthill Public Utility District
 City of Morro Bay
 City of Vacaville
 City of San Carlos
 City of Monterey
 City of Modesto
 City of Riverbank
 City of Oxnard

BWA has served
over 550 public
agencies
throughout
California and
the western
United
States.

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

PROJECT TEAM
BWA uses a team approach for most projects, typically assigning two consultants to each assignment, including at least one principal consultant. Our general project approach is to work closely with staff and other members of the project team to: identify objectives, set milestones, have frequent communication, and remain flexible to resolve unanticipated issues.

Bartle Wells Associates has a highly qualified professional team. Our education and backgrounds include finance, civil engineering, business, public administration, public policy, and economics. Bartle Wells Associates has a long track record of completing projects on time and on or under budget.

Our consulting staff is available to a ssist on this project as needed to ensure all project work and deliverables are completed on schedule.

Doug Dove, Principal in Charge
Doug Dove is President of BWA and one of BWA’s principal consultants.

He has more than 30 years of professional experience, specializing in all areas of public finance, including utility rate setting, capacity fee implementation, strategic financial planning, and infrastructure financing. He has extensive experience developing strategic financial plans and utility rate studies and has consulted for more than 150 California agencies. Doug has substantial experience working with public agency staff and governing bodies to build understanding and consensus for recommendations.

Erik Helgeson, Senior Project Manager
Erik Helgeson is a Vice President of BWA with 12 years of experience. He specializes in developing long-term financial models and utility rates based on a cost of service approach. His experience includes working as a senior finance analyst for Denver Water in the rates and charges group and as a utility rate consultant in Colorado and California.

His prior experience working for a utility gives him a unique perspective on the internal challenges a utility faces when implementing a study’s recommendations. He currently serves on American Water Works Association’s Rates and Charges Committee.

Alex Handlers, Subject Matter Expert
Alex Handlers is a principal and vice-president of BWA and will serve as project manager for this engagement. He has extensive expe rience developing strategic financial plans and utility rate studies and has consulted for more than 150 California agencies. Alex has substantial experience working with public ag ency staff and governing bodies to build understanding and consensus for recommendation. He is a Certified Independent Professional Municipal Advisor and Board Member of the National Association of Municipal Advisors. Alex will provide input and review utilizing his experience working with agencies in the region who have recycled water programs.

Principal in Charge
Doug Dove, PE, CIPMA

Project Manager
Erik Helgeson

Subject Matter Expert
Alex Handlers
Analytical Support
Additional BWA Staff
Available as Needed

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

RESUMES

DOUGLAS R. DOVE
Principal in Charge
Douglas R. Dove is President of Bartle Wells Asso ciates and directs the operation of the firm while maintaining a principal consultant’s role. With over 30 years of consulting experience, he specializes in utility rate analysis, strategic financial planning, and project financing. Mr. Dove has developed utility rate structures and financing plans for a wide variety of public infrastructure programs. He has managed the procurement of over $1 billion in m unicipal debt and over $300 million in state and federal grants and low-interest loans. Mr. Dove frequently shares hi s expertise and has given presentations at conferences including the Association of California Water Agenci es (ACWA), the American Water Works Association (AWWA), the California Association of Sanitation Ag encies (CASA), the California Municipal Rates Group (CMRG), the California Special Dist rict’s Association (CSDA), the California Municipal Treasurers Association (CMTA), the California Water Environment Association (CWEA) and Water Reuse. By special request in July 2015, Mr. Dove made a presentation to the California Water Resources Control Board regarding water conservation pricing. Mr. Dove is al so a published author of a water rate paper in the Journal of the American Water Works Association (Implementing Consumption-Based Fixed Rates in Davis, Calif.). Mr. Dove’s expertise also includes assisting agencies in securing state and federal grants and loans and in issuing certificates of participat ion (COPs), revenue bonds, general obligation bonds, assessment district bonds, Marks-Roos revenue bonds, CFD (Mello-Roos) bonds, private placement loans and other types of debt. Mr. Dove recently finished his term on the board of directors of the National Association of Municipal Advisors (NAMA).

Education
M.S., Civil Engineering - University of California, Berkeley B.S., Civil Engineering – Drexel University, Philadelphia, PA

Representative Projects
 City of Modesto: Provided rate expert litigation support in wastewater rate litigation. Developed water and wastewater cost-of-service and capacity fee studies.  Modesto Irrigation District: Developed cost allocation methodology between the district’s domestic water, irrigation, and electric enterprises.
 City of Davis: Comprehensive water rate study develo ped with a 15-member Water Advisory Committee. Completed a water capacity fee study for the City as well.  City of Placerville: Wastewater rate study and capacity fees  Napa-Berryessa Resort Improvement District: Developed financing plan for water and wastewater public-private partnership (P3). Prepared assessm ent engineers report. Formed an assessment district and secured $11.1 million in federal funding from US Department of Agriculture.  City of American Canyon: Comprehensive, multi-year water and wastewater rate study.  Madera County, CA: Rate studies for twenty-three of the county’s water and sewer special service districts
 City of Patterson: Water and wastewater rate studies and five-year financing plans.  City of San Juan Bautista: Water and Wastewater rate and capacity fee studies, DIF study, Revenue bonds for water and wastewater projects, continuing disclosure services.  Del Paso Manor Water District: Comprehensive water financial plan and rate study.  Browns Valley ID: Water rate study
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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal  Rio Linda/ Elverta Community Water District: Comprehensive water financial plan, connection fee and rate study.
 City of Imperial, CA: Water and wastewater financial plans and rate studies.  East Bay Municipal Utility District: Comprehensive water rate study and AB 1600 capacity fee review, Wastewater cost-of-service review and capacity fee review, various other financial studies  City of Santa Barbara: Comprehensive water rate and capacity fee study.  Newhall County Water District: Provided rate expert litigation support in water rate litigation.  City of Monterey: Developed financing plan and rate study for $20 million wastewater pipeline rehabilitation project.
 San Miguel Community Services District, CA: Water and wastewater financial plans and rate studies.  City of Santa Clara: Wastewater rate and capacity fee study.  City of Gilroy: Water and wastewater rate studies.
 West Valley Sanitation District (Campbell, CA): Wastewater rate study, financing plan and bond issuance.
 City of Ontario/Ontario Redevelopment Agency: financial advisor on $134.3 million in development refunding and new money issues (2), which included financing for the Ontario Convention Center.  City of Calistoga: Long range utility financial plan, water and wastewater rates, secured financing for WW treatment plant upgrade ($6 million SRF loan , $3 million Small Community Grant, $3.5 million revenue bonds).
 El Dorado Irrigation District: Water and wastewater rate studies.  Lake Arrowhead Community Services District : Financial master plan, $28 million revenue bond refinancing and water and wastewater rate studies.
 California Statewide Communities Development Authority: Financial advisor for statewide pooled revenue bond program (over $250 million issued for over 32 borrowers).  South Bay Water Recycling Program, Phases 1 & 2: Financial plan and rate study for $200+ million regional (San Jose area) wastewater recycling program.
 City of Tulare: Financial advisor to the city, sale of $63 million in bonds (3 issues), water and wastewater rate studies.
 Big Bear Area Regional Wastewater Agency: Regional wastewater rate study, sale of bonds (2 issues) and bank loans (2 loans).

Professional Memberships
 National Association of Municipal Advisors (former Board Member)  League of California Cities
 American Water Works Association
 Association of California Water Agencies
 California Water Environment Association
 California Association of Sanitation Agencies
 California Special Districts Association
 Water Reuse Association

Certifications
Certified Independent Professional Municipal Advisor (CIPMA), Registered Professional Engineer (PE) in California (PE# 45642) and MSRB -Registered Municipal Advisor – Series 50

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal ERIK W. HELGESON
Senior Project Manager
Erik Helgeson is a vice president of Bartle Wells and Associates with twelve years of utility finance experience. His areas of expertise include the develo pment of financial plans, ratemaking, and policy solutions for water, stormwater and wastewater uti lities. His experience includes both working for a utility as a senior finance analyst for Denver Water a nd now as a utility rate consultant helping agencies develop strong financial plans and equitable rates aligned with their objectives. Erik has extensive expertise in working with executive level staff and a ssisting in strategic decisions. He serves on the American Water Works Association (AWWA) Rates an d Charges Committee and has presented at the Utility Management Conference.

Education
M.B.A., Entrepreneurship – University of Colorado, Denver B.A., Business Administration – Gonzaga University

Representative Projects
 Fallbrook PUD, CA: Project manager for a water, sewer and recycled water rate study  Pico Water District, CA: Water financial plan and cost-of-service rate study  Big Bear City CSD, CA: Water, sewer and solid waste cost-of-service rate studies  City of Modesto, CA: Analytical support for water and wastewater financial plans and rate studies  Modesto Irrigation District: Designed an allocation methodology between the district’s domestic water, irrigation, and electric enterprises.
 City of Hemet, CA: Water budget rate design and cost of service study  Marin Municipal Water District, Marin, CA: Analyst supporting the financial plan and rate study update in 2016. Project manager for 2022 water and recycled water rate study.  City Lindsay, CA: Water and wastewater rate studies and infrastructure use fee study  City of Imperial, CA: Lead consultant providing water and wastewater financial plans and rate studies  City of Vacaville, CA: Water and wastewater capacity fee studies  Union Sanitary District, CA: Wastewater capacity fee study  City of Riverbank, CA: Project Manager for solid waste rate and sewer rate and connection fee studies  City of Placerville, CA: Analytical support for water financial plans and rate studies.  San Luis Water District, CA: Prop. 218 Assessment Election  Panoche Water District, CA: Prop. 218 Assessment Election  City of Patterson, CA: Solid waste rate study
 Madera County, CA: Lead consultant providing rate studies for twenty-three of the county’s water and sewer special service districts
 San Miguel Community Services District, CA: Lead consultant providing water and wastewater financial plans and rate studies. The District was nearing insolvency and large rate increases were needed to save the District.

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City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal  Alameda County, CA Reviewed proposed wheeling charges on behalf of the local agency partners working on the Los Vaqueros Dam expansion project.
 Carlsbad, CA: Played a key role in completing the 2016 water cost of service study. Created a supply- based cost allocation and supply layered, tiered, water rate design  City of Paso Robles, CA: Water and wastewater rate studies  King City, CA: Wastewater financial plan and rate study  Castle Pines North Metropolitan District, CO: Lead consultant providing annual water and wastewater financial plans and rate study updates
 City of Benicia, CA: Water and wastewater rate and connection fee studies  Arapahoe Parks and Recreation District, CO: Reviewed water rates for fairness  City of San Juan Bautista, CA: Water and Wastewater rate and capacity fee studies  Las Gallinas Valley Sanitary District, CA: Support for annual budget process  Tres Pinos CSD, CA: Project manager for water and sewer rate studies  Leland Meadows CSD, CA: Project manager for water and sewer rate studies  City of Willits, CA: Lead consultant providing water and wastewater financial plans and rate studies  The Cities of Pinole and Hercules, CA: Assisted the cities with the co-financing of a wastewater project with SRF loans. This included the design of the payment and reimbursement process, the administration of the process, and navigating the State requirements.  Humboldt Bay Municipal Water District, CA: Lead consultant providing 10-year financial plan update  Sacramento County Water Authority, Sacramento, CA: Lead analyst supporting water financial plan and rate study
Public Utility Experience
Denver Water, Denver, CO:

Senior Finance Analyst- Assisted with the annual cost of service study and financial plan, provided regular revenue reports, and oversaw the gathering and re porting of metrics to support Denver Water’s organizational improvement initiatives. As the lead an alyst on the initiative to change the rate design he facilitated research (customer survey and affordab ility study), performed rate design analysis, and assisted with stakeholder outreach (municipalities, customers, business representatives, non-profits, and Denver Water executives and Board) which led to th e adoption of new rate st ructures. He coordinated the implementation efforts between various business units to ensure a successful rollout of the new rates and rate structures.

Professional Memberships
American Water Works Association – Member of Ra tes and Charges Committee, Contributing Author of the AWWA M1 Manuel “Principles of Water Rates, Fees and Charges”

Certifications
MSRB-Registered Municipal Advisor (Series 50)

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BARTLE WELLS ASSOCIATES Page 16
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal ALEX T. HANDLERS

Principal Consultant
Alex Handlers is a principal and vice president of Ba rtle Wells Associates with expertise in the areas of utility rates and finance. He has extensive experience developing long-term financial plans, utility rates, and development impact fees for utility enterprises. Alex has helped agencies implement a wide variety of water and sewer rate and fee structures and is knowledgeable about the legal requirements of rates and fees. He has managed projects for over 150 cities, counties, and special districts.

Alex is also an independent financial advisor who he lps public agencies secure low-cost financing for capital projects. He has expertise helping public ag encies evaluate financing alternatives for capital improvement programs and obtain over $2 billion in financing via bonds, COPs, bank loans/private placements, lines of credit, and var ious state and federal funding programs. He is an MSRB-Registered Municipal Advisor, a Certified Independent Professional Municipal Advisor, and a current Board Member of the National Association of Municipal Advisors.

Education
M.P.A. - University of Washington
B.A. - Lehigh University

Certifications
Board Member – National Association of Municipal Advisors CIPMA – Certified Independent Professional Municipal Advisor MSRB-Registered Municipal Advisor (Series 50)

Representative Projects
 Ramona Municipal Water District: Developed long-term financial plans and cost-of-service rate studies for the District’s two sewer service areas designed to support capital improvements to each area’s wastewater treatment plant and provide an ongoing funding stream for rehabilitation and replacement of aging pipelines. Updated the District’s wastewater system capacity charges.

Developed a cost-of-service recycled water rate analysis.  Monterey One Water (formerly Monterey Regional Water Pollution Control Agency): Developed a long-term financial plan, sewer rate study, capacity charge study, and update of a range of miscellaneous fees and charges.
 City of Redwood City: Developed water and sewer financial plans and utility rate studies designed to support long-term operating and capital needs while providing a defensible cost-justification for the City’s water and sewer rates. BWA has assisted Redwood City on a number of financial consulting assignments since the early 2000s including developi ng financial plans and utility rates supporting a) construction of a $72 million recycled water projec t, b) funding the City’s roughly $400 million share of improvements to the regional wastewater treatment plant, c) funding major increases in wholesale water rates, and d) increasing funding for ongoing investment in the City’s aging infrastructure.  Joshua Basin Water District: Long-term financial plan and water rate study recommending a gradual increase in water rates coupled with rate structur e modifications to provide additional conservation incentive. Updated District’s connection fees. Worked closely with the Dist rict’s Board of Directors and a Citizen Advisory Committee to develop final recommendations.  City of Palm Springs: Developed a long-term wastewater enterprise financial plan and sewer rate study supporting an $80 million capital improvement program. Updated wastewater connection fees.  City of San Carlos: Developed a sewer enterprise financial plan and rate study designed to support sewer collection system capacity improvements, long-term pipeline replacements, and over City Council Regular Meeting - Page 176 of 1385

BARTLE WELLS ASSOCIATES Page 17
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal $120 million for the City’s share of costs for rebuild ing the regional wastewater treatment plant.

Evaluated residential rate alternatives and recommended modifications to the City’s sewer rate structure designed to improve rate equity and align rates with the cost of service. Updated the City’s sewer capacity charges levied on new development and developed solid waste rate recommendations to support future funding requirements and restore rate equity.  City of Hesperia: Developed water and wastewater financing plans, rates, and connection fees to support engineering master plan recommendations. Recommended a phase in of water & sewer rate adjustments including rate structure modification s designed to gradually increase conservation incentive. Built consensus with a citizen-based Council Advisory Committee.  City of Fresno: Developed wastewater enterprise financial plan and Excel-based financial model used by City staff to update financial and rate projections. Developed new water connection fees designed to recover costs of existing facilities and future supplemental water supply to serve new development.  Victor Valley Wastewater Reclamation Authority: Developed financial plan and rate recommendations for a regional wastewater authority serving agencies in San Bernardino County.  Silicon Valley Clean Water: Developed 10-year financial plan supporting over $750 million of capital improvements to a regional JPA that provides sewer treatment to Belmont, Redwood City, San Carlos, and the West Bay Sanitary District. Served as financial advisor on issuance of $200 million of financing via bonds, State Revolving Fund (SRF) loans, and a line of credit.  City of Port Hueneme: Developed water and wastewater rate studies designed to bring rates in line with the cost of providing utility services. Phased in new volumetric water rates.  City of Mountain View: Developed 10-year water and wastewater financial plans and rate studies.

Evaluated water and sewer rate structures and recommended modifications to improve rate equity and compliance with Prop. 218. Updated the City’s water and wastewater connection fees.  City of Poway: Evaluated conservation-oriented water rate structures and assisted City in transitioning from a uniform block rate to a partia lly-tiered rate structure to help meet conservation targets. Developed financial projections accounting for the impacts of conservation.  City of San Mateo: Developed a sewer enterprise financial plan and rate recommendations supporting funding for a roughly $900 million wastewat er capital improvement program needed to improve wet weather capacity and rebuild the City’s aging wastewater treatment plant. Transitioned residential sewer rates from 100% volumetric rate s (subject to a minimum charge) to a hybrid 50% fixed & 50% volumetric rate structure.
 Cucamonga Valley Water District: Transitioned the District’s water rates from a uniform block rate structure to a 4-tiered consumption rate structure. P h a s e d i n r a t e i n c reases and rate structure adjustments to minimize the annual impact on ratepayers. Updated the District’s ]connection fees.  City of Petaluma: Developed water and sewer financial plans and rate studies designed to support each utility’s long-term capital improvement program. Recommendation included a gradual phase-in of rate increases along with automatic inflationary rate adjustments designed to keep rates aligned with the cost of providing service.
 San Francisco Public Utilities Commission: Developed financial projections supporting over $2 billion of bonds issued to help fund a $4.3 billion upgrad e to the Hetch-Hetchy regional water system and improvements to the City’s wastewater system.

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BARTLE WELLS ASSOCIATES Page 18
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Section 4: References
City of Modesto, CA

In 2015, BWA was retained to work with the City and the Industrial customers to develop a new wastewater rate structure based on the 2014 Tolling Agreement. Working closely with an accountant hired by the City’s large industrial customers, BWA developed a separate large industrial wastewater rate structure and capacity fee schedule for cannery customers. BWA also developed new rates reflecting the City’s tertiary treatment stream and secondary tr eatment “scalping.” We met with stakeholder groups, the wastewater master planning engineering team , Finance Committee, and City Council on many occasions to vet our recommendations and gain consensus. Our rate study was implemented by City Council April 2016.

In 2015, the City retained BWA to conduct a comprehensive water rate study. The City had not raised rates since 2013 and experienced re duced revenue due to drought conditions. BWA developed drought surcharges and analyzed individualized rate structures for each of the City’s outlying service areas. A Proposition 218 hearing to adopt proposed rates was successfully completed in Fall 2016.

In 2021 BWA was retained again to perform water and sewer rate studies. BWA completed the sewer rate study and is in the process of completing the water rate study.

Agency Contact:

William Wong, P.E., Public Works Director
(209) 571-5801
[email protected]
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BARTLE WELLS ASSOCIATES Page 19
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

Big Bear City Community Services District, CA

Bartle Wells Associates first assisted the District in 1967. BWA developed the district’s early financing and revenue programs to build sewers and finance wastewater improvements. BWA assisted the district with the authorization and sale of three series of genera l obligation bonds and supervised the sale of five assessment bond issues in the Sugarloaf and Pinewood areas.

In 1994, BWA prepared a water rate study under the close supervision of a Water Rate Study Committee made up of citizens and board members. The water rate study addressed issues of water rate equity with the mobile home park.

In 2015, BWA assisted the District in developing water, wastewater a nd solid waste 5-yr financing plans and rate studies.

Most recently, in 2019, BWA perfor med comprehensive water, wastew ater and solid waste cost-of- service rate studies. BWA recommended a series of rate increases designed to meet each utility’s operating and capital funding needs. BWA also review ed the water and solid waste rate structures and customers classes and recommended modifications desi gned to equitably recover the costs of providing service, comply with Proposition 218, and achieve the District’s objectives.

BWA assisted the District with the Proposition 218 noticing and th e rate adoption process which ultimately resulted in Board’s adoption of recomm ended rate increases and cost-of-service based rate structure modifications.

Contact:

Mary Reeves
General Manager
909-585-6525
[email protected]
City Council Regular Meeting - Page 179 of 1385

BARTLE WELLS ASSOCIATES Page 20
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

Pico Water District, CA
Pico Water District (District) prov ides water distribution and mainte nance service to 5,600 customers in Pico Rivera, CA. The District provides water service to its customers through the use of a 1.25 million gallon reservoir and five wells ranging in water produc tion from 600 gallons per minute to 2,800 gallons per minute. The District pumps all of its water from the underground aquifer known as the Central Basin, which is an adjudicated water basin.

The District contracted Bartle Wells Associates (BWA) to conduct a water rate study which recommended rates sufficient to support capital projects and complied with Proposition 218. BWA provided several rate structure recommendations including transitioning to a uniform rate structure. The Pico Water District Board adopted the BWA recommended rates after a successful 218 process.

Contact:

Mark Grajeda, General Manager
Pico Water District
(562) 692-3756
[email protected]

Additional References are Available Upon Request
City Council Regular Meeting - Page 180 of 1385

BARTLE WELLS ASSOCIATES Page 21
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal Section 5: Project Schedule

Provided below is a draft timeframe for completion of the Project. BWA will work with the City to develop a final schedule designed to meet the City’s objectives. BWA has the capacity to complete the projected on a compressed timeline if necessary.

Proposed Project Schedule

PROJECT TASK
Research
10-Year Financial Plans
Cost of Service Rate Analysis
Connection Fee Updates
Draft, Revised, & Final Reports
Meetings and 218 Process
Note: Individual project milestones will be established based on consultation with the project team.

DEC/JAN FEB/MAR APR/MAY
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BARTLE WELLS ASSOCIATES Page 22
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

SCHEDULE OF INSURANCE

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BARTLE WELLS ASSOCIATES Page 23
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

MUNICIPAL ADVISOR DISCLOSURES

This section provides certain disclosures required by the Municipal Securities Rulemaking Board (MSRB) regarding our duties as a Municipal Advisor to the extent any such duties apply to this assignment. * Bartle Wells Associates will provide advice and conduct activities with a “duty of care” and a “fiduciary duty” to the City. Our role and respon sibilities during this engagement will continue through the completion of the project.
* Bartle Wells Associates is a registered Munici pal Advisor with the Securities and Exchange Commission (SEC Registration No. 867-00740) and the Municipal Securiti es Rulemaking Board (MSRB ID K0414).
* Bartle Wells Associates has never been cited for any legal or disciplinary action regarding municipal advisory activities.
* Bartle Wells Associates has not and will not receive any compensation from any third party seeking to provide services, municipal securities transactions, or municipal financial products related to this transaction. BWA or any of its employees will not engage in any activities that would produce a direct or indirect financial gain for th e firm other than compen sation for our services identified in this proposal.
* Bartle Wells Associates is not aware of any conflicts of interest that would affect our ability to provide independent and objective advice and Munici pal Advisory services in a manner consistent with the requirements of MSRB Rule G-42.
* The website address for the Municipal Securities Rulemaking Board (MSRB) is www.MSRB.org.

The MSRB’s website provides a municipal advisory client brochure that describes the protections that may be provided by the MSRB rules and how to file a complaint with an appropriate regulatory authority. The municipal advisory client brochure is accessible via a link on www.MSRB.org or can be downloaded from http://www.msrb.org/~/media/Files/Resources/MSRB-MA-Clients-Brochure.

City Council Regular Meeting - Page 183 of 1385

BARTLE WELLS ASSOCIATES Page 24
City of Lynwood – Water and Wastewater Rate and Connection Fee Study Proposal

Attachment A
City Council Regular Meeting - Page 184 of 1385

Fallbrook Public Utility District

2022 Water, Wastewater, and
Recycled Water Rate Study
Draft Report / September 21, 2022
City Council Regular Meeting - Page 185 of 1385

City Council Regular Meeting - Page 186 of 1385

September 21, 2022

David Shank, Assistant General Manager/CFO
Fallbrook Public Utility District
990 E. Mission Road
Fallbrook, CA 92088

Re: Water, Wastewater & Recycled Water Rate Study

Bartle Wells Associates is pleased to submit the attached Water, Wastewater & Recycled Water Rate Study. The study develops long‐term financial projections for the District’s water, wastewater and recycled water utilities and calculates new rates designed to equitably recover the costs of providing service. The recommended rates are designed to meet the District’s funding needs, comply with legal requirements, and be fair to all customers.

The proposed rates incorporate both overall rate increases as well as some modifications to the rate structures designed to improve rate equity and align rates with the cost of providing service.

Rate increases are phased in over five years to minimize the annual impact on customers.

We enjoyed working with the District on this project and appreciate the assistance and input received from the District throughout the project. Final recommendations were developed with input from the District’s project team, the District’s Fiscal Policy & Insurance Committee, and independent legal counsel. Please contact us anytime if you have questions about the recommendations in this report or other issues regarding utility rates and finances.

Sincerely,

BARTLE WELLS ASSOCIATES

Erik Helgeson,
MBA Alex Handlers, MPA, CIPMA
Senior Project Manager Principal/Vice‐President

2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel 510 653 3399
www.bartlewells.com
City Council Regular Meeting - Page 187 of 1385
Table of Contents
Water & Sewer Financial Plans & Rate Studies
TABLE OF CONTENTS
1 Executive Summary ........................................................................................... ES‐1

1.1 Introduction .............................................................................................................. ES‐1

1.2 Water Rate Recommendations ................................................................................. ES‐2

1.3 Wastewater Rate Recommendations ........................................................................ ES‐6

1.4 Recycled Water Rate Recommendations .................................................................. ES‐8

1.5 Updated Fund Reserve Targets ................................................................................. ES‐8

1.6 Preliminary Savings Analysis of Detachment from SDCWA ....................................... ES‐9 2 Background, Objectives, & Legal Requirements ...................................................... 1

2.1 Background ................................................................................................................... 1

2.2 Rate Study Objectives ..................................................................................................... 1

2.3 Rate‐Study Process ......................................................................................................... 2

2.4 Constitutional Requirements for Rates .......................................................................... 2

2.4.1 Article 13D, Section 6 ..................................................................................................... 3

2.4.2 Article 10, Section 2 ........................................................................................................ 4

2.5 Rate Increase Pass Through Provisions........................................................................... 4 3 Water Enterprise Finances & Rates ......................................................................... 5

3.1 Water System Overview ................................................................................................. 5

3.2 Water Financial Overview .............................................................................................. 6

3.3 Current & Historical Water Rates ................................................................................... 7 4 Water Financial Plan ............................................................................................. 10

4.1 Financial Plan Assumptions .......................................................................................... 10

4.2 Financial Plan Drivers ................................................................................................... 11

4.3 Cash Flow Projections with Existing Rates .................................................................... 14

4.4 Cash Flow Projections and Recommended Rate Increases ........................................... 15 5 Projected Water Demand and Customer Characteristics ....................................... 18

5.1 FPUD Water Supply and Metered Water Demand Projection ...................................... 18

5.2 Water Services and Equivalent Capacity ...................................................................... 18

5.3 Fire Service Capacity ..................................................................................................... 20 6 Water Demand Categorization and Supply Utilization ........................................... 21

6.1 Water Demand Categorization ..................................................................................... 21

6.2 FPUD Water Supplies ................................................................................................... 25

6.3 Water Supply Utilization by Demand Classes ............................................................... 26

6.4 M&I Use Categories ...................................................................................................... 28 7 Water Cost of Service Rate Analysis ...................................................................... 32

7.1 Revenue and Expense Allocation Categories ................................................................ 33

7.2 Allocations Between Fixed Capacity and Variable Water Usage Functions .................. 36

7.3 Functional Cost Allocation ............................................................................................ 37

7.4 Allocation to Fixed Cost Functional Components ......................................................... 37

7.5 Fixed Cost Functional Component Unit Costs ............................................................... 39 City Council Regular Meeting - Page 188 of 1385
Table of Contents
Water & Sewer Financial Plans & Rate Studies

7.6 Function Allocation to Variable Cost Components ....................................................... 39

7.7 Volumetric Unit Costs by Functional Components ....................................................... 42 8 Water Rate Derivation .......................................................................................... 43

8.1 Rate Structure Recommendations ............................................................................... 43

8.2 Agricultural Rate Derivation ......................................................................................... 44

8.3 M&I Demand Class Rate Derivation ............................................................................. 45

8.4 Residential Tier Rate Derivation ................................................................................... 48

8.5 Pumping Charge Derivation .......................................................................................... 49

8.6 Monthly Fixed Service Charge Derivation ..................................................................... 49

8.7 Capital Improvement Charge Derivation ...................................................................... 52

8.8 SDCWA IAC Fixed Passthrough Charge ......................................................................... 52

8.9 Proposed Water Rates .................................................................................................. 54 9 Water Shortage Emergency Surcharges ................................................................ 56 10 Water Rate Bill Impacts ........................................................................................ 59 11 Financial Impact of Detachment From SDCWA ...................................................... 60 12 Wastewater Enterprise Finances & Rates .............................................................. 61

12.1 Wastewater System Overview ..................................................................................... 61

12.2 Wastewater Financial Overview ................................................................................... 61

12.3 Current & Historical Wastewater Rates ........................................................................ 61 13 Wastewater Financial Plan ................................................................................... 63

13.1 Financial Plan Assumptions .......................................................................................... 63

13.2 Financial Plan Drivers ................................................................................................... 64

13.3 Cash Flow Projection with No Rate Increases ............................................................... 66

13.4 Cash Flow Projections and Recommended Rate Increases ........................................... 66

13.5 Wastewater Debt Service Coverage ............................................................................. 69 14 Wastewater Cost of Service Analysis and Rate Derivation ..................................... 70

14.1 Wastewater Rate Structure Recommendations ........................................................... 71

14.2 Wastewater Billing Units .............................................................................................. 72

14.3 Flows and Loadings ...................................................................................................... 74

14.4 Revenue and Expense Allocation Categories ................................................................ 76

14.5 Functional Allocation .................................................................................................... 76

14.6 Wastewater Unit Cost Derivation ................................................................................. 77

14.7 Flow and Strength Revenue Requirement by Class ...................................................... 78

14.8 Domestic Flow and Strength Rate Derivation ............................................................... 79

14.9 Non‐Residential Volumetric Rate Derivation ................................................................ 81

14.10 School Strength and Flow Rate Derivation .................................................................. 81

14.11 Wastewater CIC Charge ............................................................................................... 82

14.12 Proposed Wastewater Rates ....................................................................................... 83

14.13 Wastewater Bill Impacts .............................................................................................. 84 15 Recycled Water Enterprise Finances & Rates ........................................................ 86

15.1 Recycled Water System Overview ................................................................................ 86 City Council Regular Meeting - Page 189 of 1385
Table of Contents
Water & Sewer Financial Plans & Rate Studies

15.2 Recycled Water Financial Overview ............................................................................. 86

15.3 Current & Historical Recycled Rates ............................................................................. 87 16 Recycled Water Financial Plan .............................................................................. 88

16.1 Financial Plan Assumptions .......................................................................................... 88

16.2 Financial Plan Drivers ................................................................................................... 89

16.3 Cashflow Projection at Existing Rates ........................................................................... 90

16.4 Cashflow Projection and Recommended Rate Increases .............................................. 90 17 Recycled Water Cost of Service Analysis & Rate Derivation ................................... 93

17.1 Fixed Service Charge Derivation ................................................................................... 93

17.2 Variable Service Charge Derivation .............................................................................. 96

17.3 Proposed Recycled Water Rates ................................................................................... 97

Appendix A – Supporting Tables
Appendix B – Notice of Public Hearing on Proposed Water, Wastewater and Recycled Water Rate Increases

City Council Regular Meeting - Page 190 of 1385
Table of Contents
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Water Tables & Figures

List of Tables
Table W1: Historical Fixed Monthly Water Rates ......................................................................... 8 Table W2: Historical Volumetric Water Rates .............................................................................. 9 Table W3: Water Enterprise Escalation Factors ......................................................................... 10 Table W4: Projected Water Purchase Cost Summary ................................................................. 13 Table W5: Proposed Water Rate Adjustments ........................................................................... 15 Table W6: Detailed Water Financial Projections ........................................................................ 17 Table W7: Historic and Projected Water Supply and Metered Demand .................................... 18 Table W8: Water Services and Equivalent Meter Units .............................................................. 19 Table W9: Water Services and Equivalent Units ........................................................................ 20 Table W10: Projected FY 22/23 Water Demand by Demand Class ............................................. 22 Table W11: Demand Class Supply by Customer Class & Tier ...................................................... 23 Table W12: Projected Water Use by Customer Class & Tier ...................................................... 24 Table W13: Projected FY 22/23 Water Use by Demand Class & Tier .......................................... 25 Table W14: Projected Water Supply to Meet Metered Water Demand ..................................... 26 Table W15: Water Supply Utilization by Demand Class ............................................................. 27 Table W16: M&I Use Categories ................................................................................................ 28 Table W17: M&I Supply Utilization by Use Category .................................................................. 30 Table W18: Allocation Categories for Functional Allocation ...................................................... 36 Table W19: Allocation to Fixed Cost Functional Components .................................................... 38 Table W20: Fixed Monthly Unit Costs by Functional Component ............................................... 39 Table W21: Fixed Allocation Units .............................................................................................. 39 Table W22: Cost Allocation to Variable Cost Recovery Functional Components ......................... 41 Table W23: Volumetric Unit Costs by Function ........................................................................... 42 Table W24: Volumetric Allocation Units ..................................................................................... 42 Table W25: Agricultural Demand Class Revenue Requirements ................................................ 44 Table W26: Demand Class Unit Costs ......................................................................................... 44 Table W27: M&I Use Category Revenue Requirements ............................................................. 46 Table W28: M&I Demand Class Revenue Requirements ............................................................. 47 Table W29: M&I Demand Class Unit Costs ................................................................................. 47 Table W30: Residential Tier Revenue Requirements ................................................................. 48 Table W31: Residential Tier Unit Rates ...................................................................................... 49 Table W32: Pumping Charge Derivation .................................................................................... 49 Table W33: Service Charge Functional Component Composition ............................................... 50 Table W34: Monthly Fixed Water Service Charge Derivation..................................................... 50 Table W35: Monthly Fixed Standby Service Charge Derivation .................................................. 51 Table W36: Monthly Fixed Private Fire Service Charge Derivation ............................................ 52 Table W37: Monthly Fixed SDCWA IAC Fixed Passthrough Charge Derivation ........................... 53 Table W38: Proposed Water Rates ............................................................................................ 54 Table W39: Proposed Fixed Standby and Passthrough Water Rates .......................................... 55 Table W40: Water Shortage Emergency Surcharge Derivation .................................................. 57 Table W41: Proposed Maximum Water Shortage Emergency Surcharges ................................. 58 Table W42: Existing and Proposed Bills ...................................................................................... 59

City Council Regular Meeting - Page 191 of 1385
Table of Contents
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study List of Figures
Figure W1: Cost‐of‐Service Rate Study Process ............................................................................ 2 Figure W2: FPUD Water Use by Month (KGAL) ............................................................................ 6 Figure W3: Projected Water Supply Needs ................................................................................ 12 Figure W4: SDCWA Melded Treated Rate .................................................................................. 13 Figure W5: 5‐Year Cash Flow Projection Without Rate Increases .............................................. 14 Figure W6: Projected Revenues & Expenses .............................................................................. 16 Figure W7: FPUD Water Demand Categorization Levels ............................................................ 21 Figure W8: Supply Utilization by Demand Class (Kgal) ............................................................... 27 Figure W9: Projected FY 22/23 M&I Use and Water Use Categories ......................................... 29 Figure W10: M&I Supply Utilization by Use Category (Kgal) ...................................................... 30 Figure W11: Tier Demand and Use Categories ........................................................................... 31 Figure W12: Use Categories by Tier ........................................................................................... 31 Figure W13: Cost of Service Analysis Process ............................................................................. 33 Figure W14: M&I Rate Derivation .............................................................................................. 45 Figure W15: Impact of Detachment in FY 23/34 on Rate Revenue Increases ............................. 60 Wastewater Tables & Figures

List of Tables
Table S1: Historical Wastewater Rates ....................................................................................... 62 Table S2: Wastewater Enterprise Escalation Factors.................................................................. 63 Table S3: Proposed Wastewater Rate Adjustments ................................................................... 67 Table S4: Detailed Wastewater Financial Projections ................................................................ 68 Table S5: WW Debt Service Coverage Calculation ..................................................................... 69 Table S6: Recent and Projected Annual Billing Units .................................................................. 73 Table S7: Wastewater School Billing Units ................................................................................. 74 Table S8: Wastewater Flows and Loading .................................................................................. 75 Table S9: Functional Cost Allocation .......................................................................................... 77 Table S10: Unit Rate Calculations ............................................................................................... 77 Table S11: Flow and Strength Revenue Requirement by Class ................................................... 78 Table S12: Domestic Rate Derivation ......................................................................................... 79 Table S13: Domestic Rate 5‐Year Phase‐In Calculation .............................................................. 80 Table S14: Non‐Residential Rate Derivation ............................................................................... 81 Table S15: School Rate Derivation .............................................................................................. 82 Table S16: Proposed Wastewater Rates ..................................................................................... 83 Table S17: Residential Wastewater Rate Impacts ....................................................................... 84

List of Figures
Figure S1: WW 5‐Year Cash Flow Projection Without Rate Increases ........................................ 66 Figure S2: WW 5‐Year Cashflow Projection With Recommended Rate Increases ...................... 67 Figure S3: WW Cost of Service Analysis and Rate Derivation Process ........................................ 70 Figure S4: Residential Billed Winter Use Variability ................................................................... 71 Figure S5: Combined Single Family Water & Wastewater Bills ................................................... 85

City Council Regular Meeting - Page 192 of 1385
Table of Contents
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

Recycled Tables & Figures

List of Tables
Table R1: Historical Recycled Water Rates .................................................................................. 87 Table R2: Historical Recycled Water Rates .................................................................................. 88 Table R3: Proposed Recycled Rate Adjustments ......................................................................... 91 Table R4: Detailed Recycled Financial Plan ................................................................................. 92 Table R5: Recycled Services by Meter Size .................................................................................. 93 Table R6: Allocation to Fixed Cost Functional Components ........................................................ 94 Table R7: Functional Components Unit Costs ............................................................................. 94 Table R8: Fixed Monthly Recycled Water Rate Derivation .......................................................... 95 Table R9: Variable Recycled Water Rate Derivation .................................................................... 96 Table R10: Proposed Recycled Water Rates ................................................................................ 97

List of Figures
Figure R1: RW 5‐Year Cash Flow Projection Without Rate Increases .......................................... 90 Figure R2: RW 5‐Year Cashflow Projection With Recommended Rate Increases ........................ 91

City Council Regular Meeting - Page 193 of 1385
Table of Contents
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Glossary of Terms
Terms Descriptions
Active Customer A service receiving regular water service AF Acre foot / Acre feet
AWWA American Water Works Association
BWA Bartle Wells Associates
CIC Capital Improvement Charge
CIP Capital Improvement Projects
COS Cost of Service
CPI Consumer Price Index/Indices
CWA San Diego County Water Authority
CY Calendar Year
District Fallbrook Public Utility District
EDU Equivalent Dwelling Unit
EMU Equivalent Meter Unit
ENR CCI Engineering News‐Record Construction Cost Indices FPUD Fallbrook Public Utility District
FY Fiscal Year (July 1 – June 30)
GPCD Gallons per capita per day
IAC Infrastructure Access Charge
Kgal Kilogallons or thousand gallons
M1 Manual “Principles of Water Rates, Fees, and Charges: Manual of Water Supply Practices
M1", 6th edition published by AWWA
MET Metropolitan Water District of Southern California MFR Multi‐Family Residential
MWD Metropolitan Water District of Southern California O&M Operations and Maintenance
PAYGO Pay‐As‐You‐Go
R&R Repair and Replacement
RP Reduce Pressure
RTS Readiness‐to‐Serve (Water Section),
Return‐to‐Sewer (WW Section)
RW Recycled Water
SAWR Special Agriculture Water Rate
SDCWA San Diego County Water Authority
Service A connection to the District's water system
SFR Single Family Residential
SMCUP Santa Margarita Conjunctive Use Project
SP&YB Sport Park and Youth Baseball
SRF State Revolving Fund
Standby Service A service with a locked water meter
W Water
WW Wastewater

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City Council Regular Meeting - Page 195 of 1385
Executive Summary ES‐1
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 1 EXECUTIVE SUMMARY

1.1 Introduction
Fallbrook Public Utility District’s (FPUD or District) water, wastewater and recycled water utilities are financially self‐supporting enterprises that rely primarily on revenues from service charges to fund the costs of providing service. As such, the District’s rates need to be set at adequate levels to a) fund the costs of operating and maintaining the water, wastewater and recycled water systems, b) fund necessary capital improvements to keep the District’s infrastructure in good operating condition, c) pay for the wholesale costs of water supply, and d) meet annual debt service funding requirements.

The District has provided proactive financial stewardship by gradually raising rates over the past decade to keep revenues in line with the cost of providing service. The gradual rate increases have enabled the District to maintain the financial health of its utilities while avoiding the need for large rate spikes despite a number of financial challenges that have faced the water and wastewater utilities in recent years.

Some major accomplishments of the District in recent years include:
 Constructed the Santa Margarita Conjunctive Use Project (SMCUP) which will provide the District with its own local water supply, reduce reliance on imported water, and improve water supply reliability. The SMCUP was financed via a low‐interest rate State Revolving Fund Loan.  Recently completed Advanced Metering Infrastructure upgrades which will improve meter accuracy and enable the District and most customers to access real‐time water use data.  Completed a $28 million rehabilitation and upgrade of the District’s aging Water Reclamation Plant (WRP) that treats wastewater to stringent regulatory standards.  Expanded the recycled water distribution system and increased the District’s recycled water system capacity.

In 2022, the District retained Bartle Wells Associates (BWA) to develop updated financial projections and rate studies for the District’s utilities. Final recommendations incorporate input from District staff and the District’s Fiscal Policy and Insurance (FP&I) Committee, and independent legal review for compliance with the substantive provisions of Proposition 218. The proposed rates are designed to fund the operating and capital needs of the District’s utilities and equitably recover costs from all customers.

City Council Regular Meeting - Page 196 of 1385
Executive Summary ES‐2
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

1.2 Water Rate Recommendations
The District’s water utility currently maintains a healthy level of fund reserves but has faced increased financial pressures in recent years, particularly due to large increases in wholesale water rates. The water utility is facing a number of financial challenges that will require rate increases in upcoming years. These challenges include:
 Wholesale Water Rate Increases ‐ Historically, the District has relied almost entirely on imported water from the San Diego County Water Authority (SDCWA) for its water supply.

SDCWA wholesale water rates have increased substantially over time. SDCWA’s wholesale rates for water supply and treatment increased over 75% from 2010 to 2022 and are scheduled to increase by an additional 8.8% starting January 1, 2023. With the introduction of new local water supply from the Santa Margarita Conjunctive Use Project (SMCUP), the District is projected to reduce its reliance on imported water to about 60% of its total water supply by FY 2026/27 and replace higher‐cost SDCWA water with lower‐cost SMCUP water supply.
 Capital Improvements to an Aging Water System ‐ The District takes a proactive approach to maintaining its water system which requires a steady stream of repair and improvement projects. Accounting for construction cost inflation, the District anticipates funding approximately $34 million of capital improvement projects over the next 5 years, averaging $6.9 million per year. With the proposed rate increases, the District will be able to fund this level of capital spending on a pay‐as‐you‐go basis without incurring additional debt.  New Debt Service – The District was successful in obtaining a low‐interest‐rate State Revolving Fund Loan to finance the cost of the Santa Margarita Conjunctive Use Project. Debt service on the loan phases in starting FY 22/23 to a little over $3 million per year beginning FY 23/24.

While this debt service represents a substantial increase in annual expenses, lower cost water supply provided by the SMCUP is projected to result in a net reduction of expenses in future years.
 Ongoing Cost Inflation – On top of rate increases needed for other purposes, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. In recent months, inflation has reached forty‐year highs with CPI and the ENR Construction Cost Index reaching roughly 9% in early 2022.

However, inflation is not projected to remain at such elevated levels in future years.

Updated water utility financial projections indicate the need for water rate revenues to increase by

6.5% per year over the next five years, the period covered by the current rate study. The proposed rates also incorporate a few modifications to the District’s water rate structure designed to align rates with the current cost of providing service. Due to these modifications, impacts to water bills will vary based on customer class and water use when the first year proposed rates are implemented on City Council Regular Meeting - Page 197 of 1385
Executive Summary ES‐3
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study January 1, 2023. Future water rate increases starting January 1, 2024, are applied on an across‐the‐ board basis with the same percentage increase to all water rates in future years.

The proposed water structure remains relatively consistent with FPUD’s existing rate structure but incorporates some modifications designed to align rates with current projected costs of service. Rate structure recommendations are described as follows:
 Residential: Maintain a lower volumetric rate for the first 5,000 gallons (5 Kgal) of residential water use in Tier 1, reflecting the lower cost to provide water supply for base indoor demands.

Combine residential Tiers 2 & 3 into a single tier for all water use above the first 5,000 gallons to reflect current costs of service.
 Non‐Residential: Charge the same uniform volumetric rate to Commercial, Government, and Irrigation customer classes, which currently have extremely close but slightly different rates.  Agricultural: Maintain volumetric rates for Agricultural water use based on lower‐cost water supply including reduced SDCWA wholesale water supply rates for customers who qualify for SDCWA’s Permanent Special Agricultural Water Rate Program.  Recover MWD’s Readiness‐to‐Serve Charge via the District’s volumetric water rates, instead of as a small, separate pass‐through charge based on meter size, to align costs with sources of water supply to each customer class,
 Maintain the supplemental Pumping Charges to recover the incremental costs of electricity needed to provide water supply to higher‐elevation service areas but eliminate the small supplemental $0.10 per thousand gallons Pumping Capital Improvement Charge as the District’s pumping facilities provide some benefit to all customers.  Eliminate the reduced Standby Capital Improvement Charges levied on standby customers (accounts with suspended service) and instead have Standby customers pay the same Capital Improvement Charges as all other customers.
 Continue the historical practice of automatic annual adjustments to a) Capital Improvement Charges based on the annual change in the Engineering News‐Record Construction Cost Index + 3% to account for a planned gradual increase in capital improvement funding, and to b) SDCWA Infrastructure Access Charges based on actual charges established by SDCWA.

The tables on the following pages show schedules of proposed water rates and charges for the next five years. The rates shown represent the maximum rates proposed for each year. In line with historical practice, FPUD will continue to review rates each year and only increase rates as needed.

City Council Regular Meeting - Page 198 of 1385
Executive Summary ES‐4
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table ES1: Proposed Water Rates

Current
Water January 1J a n u a r y 1J a n u a r y 1J a n u a r y 1 January 1 Rates* 2023 2024 2025 2026 2027
Monthly Fixed Service Charges
Billed based on meter size.
3/4" $57.91 $60.60 $64.54 $68.74 $73.21 $77.97
1" 88.65 96.51 102.78 109.46 116.57 124.15
1‐1/2" 165.42 185.46 197.51 210.35 224.02 238.58
2" 257.59 292.64 311.66 331.92 353.49 376.47
3" 503.36 578.82 616.44 656.51 699.18 744.63
4" 779.84 900.36 958.88 1,021.21 1,087.59 1,158.28
6" 1,547.83 1,793.16 1,909.72 2,033.85 2,166.05 2,306.84 Volumetric Charges
Billed based on metered water use as measured in units of 1,000 gallons ($/Kgal).

Residential: Domestic (D), Large Lot Domestic (LD) & Multi Unit (M) Tier 1 : 0‐5 Kgal $7.17 $7.31 $7.79 $8.30 $8.84 $9.41

7.27 8.86
Commercial (C) $7.38 $7.72 $8.22 $8.75 $9.32 $9.93
Government (G) 7.26 7.72 8.22 8.75 9.32 9.93
Irrigation Only (I) 7.39 7.72 8.22 8.75 9.32 9.93
Agriculture SAWR (AS) $5.31 $5.63 $6.00 $6.39 $6.81 $7.25 Commercial Ag (CA) 6.15 6.38 6.79 7.23 7.70 8.20
Agriculture Domestic (AT)
Tier 1 :  0‐5 Kgal $7.17 $7.31 $7.79 $8.30 $8.84 $9.41
Tier 2:  6‐17 Kgal 6.15 6.38 6.79 7.23 7.70 8.20
Tier 3:  >17 Kgal 5.31 5.63 6.00 6.39 6.81 7.25
Commercial Domestic Ag (CB)
Tier 1 :  0‐5 Kgal $7.17 $7.31 $7.79 $8.30 $8.84 $9.41
Tier 2:  >5 Kgal 6.15 6.38 6.79 7.23 7.70 8.20
Pumping Charges $0.88 $0.72 $0.77 $0.82 $0.87 $0.93
(Deluz & Toyon Service Areas)
Proposed Maximum Water Rates
Proposed Maximum Rates Effective On or After
Tier 2:  >5 Kgal 8.06 8.58 9.14 9.73 10.366‐30 Kgal:
>30 Kga l :

City Council Regular Meeting - Page 199 of 1385
Executive Summary ES‐5
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table ES2: Proposed Other Water Service Charges

Current January 1J a n u a r y 1J a n u a r y 1J a n u a r y 1 January 1 Charges 2023 2024 2025 2026 2027
Water Capital Improvement Charges (CIC)
Monthly charge billed based on meter size to all active water service accounts. 3/4" $10.10 $11.11
1" 16.82 18.50
1‐1/2" 33.66 37.03
2" 53.84 59.22
3" 107.68 118.45
4" 168.25 185.08
6" 336.50 370.15
SDCWA Infrastructure Access Charges (IAC)
Monthly charge billed based on meter size to all active water service accounts. 3/4" $4.00 $4.24
1" 6.69 7.08
1‐1/2" 13.33 14.12
2" 21.34 22.60
3" 42.75 45.24
4" 66.79 70.68
6" 133.53 141.32
Monthly Fire Service Charges
Billed based on service size to customers with private fire service connections. 2" $12.25 $7.66 $8.16 $8.69 $9.25 $9.85
3" 13.06 8.90 9.48 10.10 10.76 11.46
4" 14.47 11.03 11.75 12.51 13.32 14.19
6" 19.50 18.70 19.92 21.21 22.59 24.06
8" 28.18 31.92 33.99 36.20 38.55 41.06
Monthly Standby Fixed Service Charges
Billed based on meter size to customers with inactive, standby service. 3/4" $25.22 $17.44 $18.57 $19.78 $21.07 $22.44
1" 34.15 24.43 26.02 27.71 29.51 31.43
1‐1/2" 56.46 41.75 44.46 47.35 50.43 53.71
2" 83.23 62.61 66.68 71.01 75.63 80.55
3" 154.65 118.30 125.99 134.18 142.90 152.19
4" 235.00 180.88 192.64 205.16 218.50 232.70
6" 458.16 354.65 377.70 402.25 428.40 456.25
Proposed Maximum Other Water Service Charges
Proposed Maximum Charges Effective On or After
Water CIC Charges will be adjusted each January 1 based on the annual change in the Engineering News‐Record
Construction Cost Index for Los Angeles through February of the preceding year, plus 3%, subject to a maximum
adjustment of 10% per year.

SDCWA IAC Charges will be adjusted each January 1 based on the IAC charges adopted by SDCWA in future years,
subject to a maximum adjustment of 10% per year.

City Council Regular Meeting - Page 200 of 1385
Executive Summary ES‐6
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

1.3 Wastewater Rate Recommendations
The District’s wastewater utility fund reserves are currently significantly below target levels.

Additionally, the wastewater utility faces a number of financial challenges in upcoming years that can be addressed via modest annual rate increases. These financial challenges include:
 Revenue Variability ‐ Residential variable rate revenue has been volatile due to annual changes in winter water use largely based on weather and outdoor irrigation. Based on current wastewater rates, residential rate revenues over the past three years would have varied by up to $700,000 per year.
 Low Fund Reserves ‐ The wastewater enterprise generated less revenue than projected over the past 5 fiscal years, resulting in deficits and a gradual drawdown of wastewater fund reserves. The beginning balance for FY 22/23 is estimated at $1.8 million, approximately $3 million below the target fund reserve for the enterprise.  Capital Improvements to Wastewater Facilities ‐ The District takes a proactive approach to maintaining its wastewater system which requires a steady stream of repair and improvement projects. Accounting for construction cost inflation, the District anticipates funding approximately $4.5 million of capital improvement projects over the next 5 years, averaging about $0.9 million per year. With the proposed rate increases, the District will be able to fund this level of capital spending on a pay‐as‐you‐go basis without incurring additional debt.  Ongoing Cost Inflation – On top of rate increases needed for other purposes, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. In recent months, inflation has reached forty‐year highs with CPI and the ENR Construction Cost Index reaching roughly 9% in early 2022.

However, inflation is not expected to remain at such elevated levels in future years.

Updated wastewater utility financial projections indicate the need to increase wastewater revenue by 5% per year over the next five years. The proposed rates also incorporate modifications to the wastewater rate structure designed to improve revenue stability and align rates with the current cost of providing service. Proposed rate structure modifications include:
 Transition residential rate recovery from 30% fixed rate recovery to 70% fixed rate recovery over the next 5 years to reflect costs of service and improve revenue stability, while still providing a significant level of volumetric rate recovery and customer control over their wastewater service charges. The proposed residential wastewater rates include a 5‐year phase‐in of increased fixed service charges coupled with a gradual decrease in residential volumetric rates.  Adjust the residential return‐to‐sewer factor (RTS) used to calculate volumetric charges from 75% to 80% of winter water use (from December through February) based on an updated analysis of water use and influent flows at the wastewater treatment plant.

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Executive Summary ES‐7
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  Update the volumetric wastewater rates for the District’s various commercial and non‐residential wastewater customer classes based on an updated cost‐of‐service analysis. These rate structure adjustments will result in slightly different first‐year impacts to each customer class effective January 1, 2023. Future wastewater rate increases starting January 1, 2024, are applied on an across‐the‐board basis with the same percentage increase to all charges in future years.  Continue historical practice of automatic annual adjustments to Wastewater Capital Improvement Charges based on the annual change in the Engineering News‐Record Construction Cost Index.

The following table shows a schedule of proposed wastewater rates for the next five years.

Table ES3: Proposed Wastewater Rates

Current
Wastewater January 1J a n u a r y 1J a n u a r y 1J a n u a r y 1J a n u a r y 1 Rates 2023 2024 2025 2026 2027
Residential / Domestic
Includes Single Family (D), Single Family Large Lot (LD), Multi Family (M), Ag Domestic (AT), Commercial Ag (CB) Monthly Fixed Service Charges ($/EDU) $11.08 $18.88 $26.68 $34.48 $42.28 $50.08 Volumetric Charges ($/Kgal) 11.28 10.22 9.16 8.10 7.04 5.98 Commercial / Government
Monthly Fixed Service Charge ($/EDU) $11.08 $12.14 $12.75 $13.39 $14.06 $14.76 Volumetric Charges
Comm ‐ Low Strength (C_L) $11.20 $11.09 $11.64 $12.22 $12.83 $13.47 Comm ‐ Me dium Strength (C_M) 13.81 13.82 14.51 15.24 16.00 16.80 Comm‐ High Strength (C_H) 17.22 17.66 18.54 19.47 20.44 21.46 Government (G) 11.20 11.09 11.64 12.22 12.83 13.47
Schools
Monthly charge based on number of students and staff
Elementary Students ($ per student) $1.37 $1.39 $1.46 $1.53 $1.61 $1.69 Junior High Students ($ per student) 2.00 2.08 2.18 2.29 2.40 2.52 School Staff ($ per staff) 2.00 2.08 2.18 2.29 2.40 2.52 Wastewater Capital Improvement Charges (CIC)
Monthly charge per Equivalent Dwelling Unit (EDU) billed to all active wastewater accounts.

Monthly Wastewater CIC Charges $11.68 $12.66
Proposed Maximum Wastewater Rates
Proposed Maximum Rates Effective On or After
Wastewater CIC Charges will be adjusted each January 1
based on the annual change in the Engineering News‐Record Construction Cost Index for Los Angeles through February of the preceding year, subject to a maximum adjustment of
10% per year.

City Council Regular Meeting - Page 202 of 1385
Executive Summary ES‐8
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

1.4 Recycled Water Rate Recommendations
The District’s recycled water utility is in stable financial health but faces a number of financial challenges in upcoming years that can be addressed via small, annual rate increases. These challenges include:
 Capital Improvement Needs to Recycled Water Facilities ‐ The District’s takes a proactive approach to maintaining its recycled system which requires a steady stream of repair and improvement projects. Accounting for construction cost inflation, the District anticipates funding approximately $0.5 million of capital improvement projects over the next 5 years.

With the proposed rate increases, the District will be able to fund this level of capital spending on a pay‐as‐you‐go basis without incurring additional debt.  Ongoing Cost Inflation – Annual rate increases are also needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service.

Updated recycled water financial projections indicate the need to increase rate revenues by 2.5% per year over the next five years. All recycled water use is billed at a uniform volumetric rate. No modifications to the recycled water rate structure are recommended at this time. The following table shows a schedule of proposed recycled water rates for the next five years.

Table ES4: Proposed Recycled Water Rates

1.5 Updated Fund Reserve Targets
BWA worked with the District’s project team and Fiscal Policy & Insurance Committee to develop updated fund reserve targets for the District’s water, wastewater, and recycled water utilities. Based Current
Recycled January 1 January 1J a n u a r y 1 January 1J a n u a r y 1 Water Rates 2023 2024 2025 2026 2027
Monthly Fixed Service Charges
Billed based on meter size.
3/4" $25.22 $25.85 $26.50 $27.16 $27.84 $28.53
1" 34.15 35.14 36.02 36.92 37.84 38.79
1‐1/2" 56.46 58.15 59.60 61.09 62.62 64.19
2" 83.23 85.88 88.03 90.23 92.48 94.80
3" 154.65 159.91 163.91 168.01 172.21 176.51
4" 235.00 243.09 249.17 255.40 261.78 268.33
6" 458.16 474.06 485.91 498.06 510.51 523.27
Volumetric Charges
Billed based on metered water use as measured in units of 1,000 gallons ($/Kgal).

Recycled Water Sales $6.13 $6.29 $6.45 $6.61 $6.77 $6.94 Proposed Maximum Recycled Water Rates
Proposed Rates Effective On or After
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Executive Summary   ES‐9
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study on the finances of each enterprise and an evaluation of alternatives, the following fund reserve targets are proposed:
 Water Fund Reserve Target
Operating Reserves:  6 Months of Operating Expenses
Capital Reserves:  $5 Million
SMCUP Debt Service Reserves:  2 Years of Annual Debt Service  Wastewater Fund Reserve Target
Operating Reserves:  6 Months of Operating Expenses
Capital Reserves:  $2 Million
 Recycled Water Fund Reserve Target
Operating Reserves:  6 Months of Operating Expenses
Capital Reserves:  $200,000

1.6 Preliminary Savings Analysis of Detachment from SDCWA BWA also analyzed the potential savings and impacts to water rates if the District detached from San Diego County Water Authority (SDCWA), which obtains most of its water supply from the Metropolitan Water District of Southern California (MWD), and instead purchased MWD water from Eastern Municipal Water District (EMWD) at substantially lower cost. Although all the costs related to the potential detachment from SDCWA are not currently known, initial analysis indicates the potential for annual savings of roughly $3 to $4 million per year (excluding any detachment fees).

Savings would be passed on to FPUD water customers and enable the District to defer or avoid future rate increases that would otherwise be needed.

City Council Regular Meeting - Page 204 of 1385
Background, Objectives & Legal Requirements 1
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 2 BACKGROUND, OBJECTIVES, & LEGAL REQUIREMENTS

2.1 Background
The Fallbrook Public Utility District serves a population of approximately 35,000 within a roughly 44‐square‐mile service area located in northern San Diego County, California. The District was incorporated in 1922 and is governed by a five‐member Board of Directors. The District provides water, wastewater and recycled water service to residential, agricultural, commercial, and institutional customers.

The District’s utilities operate as self‐supporting enterprise funds. Revenues are derived primarily from service charges. As such, the District must establish rates and charges adequate to fund the costs of providing service, including costs for ongoing operations, wholesale water supply, debt service, and capital improvements needed to keep the District’s aging utility infrastructure in safe and reliable operating condition.

2.2 Rate Study Objectives
In 2022, the District retained BWA to develop long‐term financial plans and rate studies for the District’s enterprises. The District has historically adopted gradual annual rate increases in order to keep revenues in line with escalating costs of providing service. Key goals and objectives of this study include developing water, wastewater, and recycled water rates that:
 Recover the costs of providing service, including operating, capital, and debt funding needs;  Are fair and equitable to all customers;
 Are easy to understand and implement;
 Comply with the substantive requirements of the California Constitution, Article 13D, Section 6 (which was adopted by the voters as Proposition 218 in 1996) and the general mandate of Article 10, Section 2 that prohibits the wasteful use of water;  Support the long‐term operational and financial stability of each utility.

City Council Regular Meeting - Page 205 of 1385
Background, Objectives & Legal Requirements 2
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

2.3 Rate‐Study Process
The general process used for this cost‐of‐service rate study is summarized on the following diagram.

Figure W1: Cost‐of‐Service Rate Study Process

Key elements of the study include:
a) Project Initiation and Data Collection – Review financial policies; collect demand and financial, and other relevant data; and review rate structures, b) Demand Analysis – Analyze past water, wastewater, and recycled water demands and customer characteristics and forecast future demands,
c) Long Range Financial Plans ‐ Develop financial projections to evaluate annual revenue requirements from rates and the overall level of rate increases needed to fund the costs of providing service and support long‐term financial stability, d) Cost Allocation – Group the District’s costs in terms of the function they serve as a basis to proportionally allocate the revenue requirement from rates, e) Cost of Service Rate Design ‐ Develop rate structures that proportionately recover costs between customer classes (i.e., residential and commercial), as well as from customers within their designated customer class.
f) Prop 218 Process – Follow the procedural requirements of Proposition 218.

2.4 Constitutional Requirements for Rates
The water, wastewater and recycled water rates proposed in this report are designed to comply with two key articles of the California Constitution: Article 13D and Article 10.

Project
Initiation
and Data
Collection
Demand
Analysis
Long‐
Range
Financial
Plan
Cost
Allocation
Rate
Design
Prop. 218
Process
City Council Regular Meeting - Page 206 of 1385
Background, Objectives & Legal Requirements 3
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

2.4.1 Article 13D, Section 6
Proposition 218 was adopted by California voters in 1996 and added Articles 13C and 13D to the California Constitution. Article 13D, Section 6 governs property‐related charges, which the California Supreme Court has ruled includes ongoing utility system charges such as water, wastewater, and garbage rates. Article 13D, Section 6 establishes both a) procedural requirements for imposing or increasing property‐related charges, and b) substantive requirements for those charges. Article 13D requires voter approval for new or increased property‐related charges but exempts rates for water, wastewater, and garbage service from this voting requirement if rates are adopted by the appropriate procedure and meet the substantive requirements. This report recommends rates designed to comply with the substantive requirements of Proposition 218.

Substantive Requirements
The substantive requirements of Article 13D, Section 6 require property‐related charges, such as the District’s water and wastewater rates, to meet the following conditions:
1) Revenues derived from the fee or charge shall not exceed the funds required to provide the property related service.
2) Revenues derived from the fee or charge shall not be used for any purpose other than that for which the fee or charge was imposed.
3) The amount of a fee or charge imposed upon any parcel or person as an incident of property ownership shall not exceed the proportional cost of the service attributable to the parcel. 4) No fee or charge may be imposed for a service unless that service is actually used by, or immediately available to, the owner of the property in question. 5) No fee or charge may be imposed for general governmental services, such as police or fire services, where the service is available to the public at large in substantially the same manner as it is to property owners.

City Council Regular Meeting - Page 207 of 1385
Background, Objectives & Legal Requirements 4
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

2.4.2 Article 10, Section 2
Article 10, Section 2 of the California Constitution states that:

It is hereby declared that because of the conditions prevailing in this State the general welfare requires that the water resources of the State be put to beneficial use to the fullest extent of which they are capable, and that the waste or unreasonable use or unreasonable method of use of water be prevented, and that the conservation of such waters is to be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare.

2.5 Rate Increase Pass Through Provisions
California Government Code Section 53756 (established via AB‐3030) became effective on January 1, 2009. As subsequently amended, this section of the Code creates certain requirements for public agencies providing water, wastewater, and garbage services when adopting automatic pass through rate adjustments to account for a) cost inflation, and b) increases in wholesale water charges or wastewater treatment charges.

According to the Code, pass throughs must be adopted via the Proposition 218 process and can be effective for up to five years without additional Proposition 218 authorization. The Proposition 218 Notice informing ratepayers of the proposed pass through(s) must include a clearly defined formula describing how any inflationary or wholesale adjustments will be implemented. Once adopted, agencies must send ratepayers an informational notice informing them of the pass‐through not less than 30 days before the effective date of the pass‐through adjustment.

City Council Regular Meeting - Page 208 of 1385
Water Finances & Rates 5
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 3 WATER ENTERPRISE FINANCES & RATES

3.1 Water System Overview
Fallbrook Public Utility District provides water service to over 9,000 accounts within a roughly 44‐square‐mile service area that includes a population of approximately 35,000 and a substantial agricultural sector. Roughly a third of District water is used by agricultural customers. The District’s water distribution system is comprised of 270 miles of pipelines, 6,800 valves, an ultraviolet disinfection water treatment plant, nine steel reservoirs, a 300‐million‐gallon treated water reservoir, and five pump stations. The District has nearly completed an Advanced Metering Infrastructure (AMI) system upgrade that will enable real‐time meter reading and provide customers with real‐time water use data.

Historically, the District’s water supply consisted mostly of imported water purchased from the San Diego County Water Authority (SDCWA) which in turn obtains most of its water supply from the Metropolitan Water District of Southern California (MWD). The District has four connections to the imported water system, three of the four are directly connected to MWD‐owned pipelines and the fourth, which is not currently used, is connected to SDCWA’s pipeline.

In 2022, the District completed construction of the Santa Margarita Conjunctive‐Use Project (SMCUP), which enables the District to treat and convey water from the Santa Margarita River Watershed. This new local source of supply will enable the District to purchase less imported water and improve water reliability during periods of drought.

The following figure shows the District’s water demands over the last four years. The District has a seasonal demand pattern, with substantially higher usage in the hotter, summer months largely due to landscape irrigation, which is two to three times the level of use during the lowest‐use wet‐ weather, winter months. However, there is some annual variability in the timing and magnitude of minimum and maximum demands.

City Council Regular Meeting - Page 209 of 1385
Water Finances & Rates 6
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Figure W2: FPUD Water Use by Month (KGAL)

3.2 Water Financial Overview
Fallbrook Public Utility District’s water enterprise is a financially self‐supporting enterprise that relies primarily on revenues from water rate revenues to fund the costs of providing service. Water rate revenues are projected to account for over 93% of total annual revenues, with the remaining revenues coming from interest earnings, property tax allocations, capacity charges from new or upsized connections, and other miscellaneous revenues. As such, water rates must be set at levels adequate to fund the costs of operating and maintaining the water system, pay for wholesale water purchases, and fund necessary capital improvements to keep the water system in good operating condition.

The District has provided proactive financial stewardship of the water utility by gradually raising rates each year to help keep revenues in line with the cost of providing water service. The water utility fund is currently in strong financial health but faces financial pressures due to increases in wholesale water rates, the addition of new debt service, and cost inflation.

0 50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
FPUD Water Use by Month (KGAL)
FY 21‐22 FY 20‐21 FY 19‐20 FY 18‐19
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Water Finances & Rates 7
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

3.3 Current & Historical Water Rates
The following tables shows a 5‐year history of the District’s water rates. Water rates include the following components:
 Fixed monthly service charges based on meter size
 Volumetric water rates that vary by customer class
 Pass‐through charges by meter size for MWD’s Readiness‐to‐Serve (RTS) charges and SDCWA’s Infrastructure Access Charges (IAC),
 Capital Improvement Charges (CIC) based on meter size that recover a portion of the District’s capital improvement costs
 Private Fire Service charges levied on accounts with private fire service connections  Monthly Standby Service Charges and Standby CIC Charges that only apply to a limited number of customers with temporarily suspended service
 Water usage in the Deluz and Toyon service areas which require additional pumping are also subject to a Pumping Charge and a separate Pumping CIC Charge applied based on metered water use.

Water CIC charges are currently escalated annually based on the percentage change in the Engineering News Records (ENR) Construction Cost Index (CCI) plus 3%. This escalation was intended to keep CIC revenues aligned with construction cost inflation and also gradually increase CIC revenues over time to help fund capital needs.

City Council Regular Meeting - Page 211 of 1385
Water Finances & Rates 8
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W1: Historical Fixed Monthly Water Rates

Monthly Fixed Charges FY 17‐18 FY 18‐19 FY 19‐20 FY 20‐21 FY 21‐22 Meter Size
Monthly Fixed Service Charge
3/4" $44.10 $46.75 $50.49 $53.52 $56.20
1" $67.33 $71.37 $77.08 $81.70 $85.79
1 1/2" $125.36 $132.88 $143.51 $152.12 $159.73
2" $195.01 $206.71 $223.25 $236.65 $248.48
3" $380.73 $403.57 $435.86 $462.01 $485.11
4" $589.67 $625.05 $675.05 $715.55 $751.33
6" $1,170.06 $1,240.26 $1,339.48 $1,419.85 $1,490.84
Capital Impr. Charges
3/4" $8.58 $9.12 $9.47 $9.77 $10.10
1" $14.30 $15.20 $15.78 $16.27 $16.82
1 1/2" $28.60 $30.40 $31.56 $32.55 $33.66
2" $45.76 $48.64 $50.49 $52.07 $53.84
3" $91.52 $97.29 $100.98 $104.14 $107.68
4" $143.00 $152.01 $157.79 $162.72 $168.25
6" $286.00 $304.02 $315.57 $325.43 $336.50
Monthly Private Fire Services Charge
2" $9.61 $10.19 $11.01 $11.67 $12.25
3" $10.25 $10.87 $11.74 $12.44 $13.06
4" $11.36 $12.04 $13.00 $13.78 $14.47
6" $15.30 $16.22 $17.52 $18.57 $19.50
8" $22.11 $23.44 $25.32 $26.84 $28.18
Monthly Standby Service Charge
3/4" $19.79 $20.98 $22.66 $24.02 $25.22
1" $26.80 $28.41 $30.68 $32.52 $34.15
1 1/2" $44.31 $46.97 $50.73 $53.77 $56.46
2" $65.32 $69.24 $74.78 $79.27 $83.23
3" $121.38 $128.66 $138.95 $147.29 $154.65
4" $184.43 $195.50 $211.14 $223.81 $235.00
6" $359.58 $381.15 $411.64 $436.34 $458.16
Monthly Standby Capital Impr. Charge
3/4" $3.89 $4.14 $4.29 $4.42 $4.57
1" $6.48 $6.89 $7.15 $7.37 $7.62
1 1/2" $12.96 $13.78 $14.30 $14.75 $15.25
2" $20.74 $22.05 $22.88 $23.60 $24.40
3" $41.47 $44.08 $45.76 $47.19 $48.79
4" $64.80 $68.88 $71.50 $73.73 $76.24
6" $129.59 $137.75 $142.99 $147.46 $152.48
City Council Regular Meeting - Page 212 of 1385
Water Finances & Rates 9
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

Table W2: Historical Volumetric Water Rates

Volumetric Rates $/ Kgal FY 17‐18 FY 18‐19 FY 19‐20 FY 20‐21 FY 21‐22 Tier Existing
Agriculture SAWR (AS) $4.17 $4.42 $4.77 $5.06 $5.31
Commercial Ag (CA) $4.83 $5.12 $5.53 $5.86 $6.15
Agriculture Domestic (AT)
Tier 1 (0‐5 Kgal) $5.62 $5.96 $6.44 $6.83 $7.17
Tier 2 (6‐17 Kgal) $4.83 $5.12 $5.53 $5.86 $6.15
Tier 3 (>17 Kgal) $4.17 $4.42 $4.77 $5.06 $5.31
Commercial Domestic Ag (CB)
Tier 1 (0‐5 Kgal) $5.62 $5.96 $6.44 $6.83 $7.17
Tier 2 (>5 Kgal) $4.83 $5.12 $5.53 $5.86 $6.15
Domestic (D/ LD)
Tier 1 (0‐5 Kgal) $5.62 $5.96 $6.44 $6.83 $7.17
Tier 2 (6‐30 Kgal) $5.71 $6.05 $6.53 $6.92 $7.27
Tier 3 (>30 Kgal) $6.95 $7.37 $7.96 $8.44 $8.86
Multi‐Unit (M)
Tier 1 (0‐5 Kgal) $5.62 $5.96 $6.44 $6.83 $7.17
Tier 2 (6‐30 Kgal) $5.71 $6.05 $6.53 $6.92 $7.27
Tier 3 (>30 Kgal) $6.95 $7.37 $7.96 $8.44 $8.86
Commercial (C) $5.79 $6.14 $6.63 $7.03 $7.38
Government (G) $5.70 $6.04 $6.52 $6.91 $7.26
Irrigation Only (I) $5.80 $6.15 $6.64 $7.04 $7.39
Pumping Surcharges* $0.69 $0.73 $0.79 $0.84 $0.88
CIC Pumping Charges* $0.10 $0.10 $0.10 $0.10 $0.10
* DSA & Toyon Service Areas only
City Council Regular Meeting - Page 213 of 1385
Water Finances & Rates 10
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 4 WATER FINANCIAL PLAN
BWA developed long‐term cash flow projections to determine the water utility’s annual revenue requirements and project required water rate revenue increases. The financial projections incorporate the latest information available as well as a number of reasonable assumptions developed with input from the District.

4.1 Financial Plan Assumptions
The following table details the escalation factors used to develop the long‐term cash flow projections.

Escalation factors are based on input from District staff, historical escalations, and conservative projections for future escalations to reasonably ensure that the maximum rates adopted by the District will provide sufficient revenues to support District operations.

Table W3: Water Enterprise Escalation Factors

REVENUE ASSUMPTIONS
 Rate adjustments are assumed to become effective on January 1 of each year.  Water sales revenues are based on the projected volume of water sales and projected water rates.  The District projects growth based on previous low growth years to ensure rate revenue is sufficient to support District operations.
 Interest earnings are projected based on the annual beginning fund balance multiplied by projected interest rate. The interest rate projections are based on recent and anticipated interest rates.
 Property tax revenues are projected to increase at the annual rate of 1% based on District evaluation of historical tax revenue increases during years of lower increases to assessed valuations in order to ensure rate revenue is sufficient to support District operations.

EXPENSE ASSUMPTIONS
 Water supply costs assumptions are shown in detail in the appendix of this report. Purchased water cost estimates are based on the latest rate information available from SDCWA and MWD and account for the District’s increasing utilization of its local, SMCUP water supply.  Operating and maintenance expenses (other than wholesale water costs) are based on the District’s 2022/23 Budget and escalation factors listed above.  The District projects the cost of Salaries to increase based on a recent compensation study and projected future cost of living adjustments.
 The District projects the cost of Benefits to increase based on projected salary costs and projected inflation of specific benefit expenses such as health insurance.  CPI cost escalation is based on the recent and historical Consumer Price Index changes. This report projects that the current high level of inflation will gradually trend downwards to a level slightly higher than historical norms from recent years, in line with recent assessments by the Federal Reserve.
 ENR cost escalation is based on the recent and historical changes in the Engineering News‐Record Construction Cost Index. This report projects that the current, extraordinarily high inflation level will gradually drop back towards a normal rate of inflation. This report projects that the current high level of inflation will gradually trend downwards to a level slightly higher than historical norms from recent years, in line with recent assessments by the Federal Reserve.  Debt service projections are based on outstanding debt schedules. The District does not anticipate issuing any additional debt in future years.

4.2 Financial Plan Drivers
The District’s water enterprise is facing a number of manageable financial challenges that will drive the need for rate increases in upcoming years. Key drivers of future rate increases are summarized as below.

Wholesale Water Rate Increases
In the past, the District has relied almost entirely on imported water from the San Diego County Water Authority (SDCWA) for its water supply. SDCWA wholesale water rates have increased substantially over time. SDCWA’s wholesale rates for water supply and treatment increased over 75% from 2010 to 2022 and are scheduled to increase by an additional 8.8% starting January 1, 2023. With the introduction of new local water supply from the Santa Margarita Conjunctive Use Project (SMCUP), the District is projected to reduce reliance on imported water to about 60% of total water supply by FY 2026/27 and replace higher‐cost SDCWA water with lower‐cost SMCUP water supply.

City Council Regular Meeting - Page 215 of 1385
Water Finances & Rates 12
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

Figure W3: Projected Water Supply Needs

Over the next 5 years, total wholesale water rates are projected to increase by an average of an additional 8.6% per year accounting for both fixed and volumetric charges levied by SDCWA.

Projected wholesale water rates are based on long‐range financial plans published by SDCWA and MWD and input from the District. However, the amount of wholesale SDCWA water purchased is projected to decline due to an increase in SMCUP water supply. The following figure shows the historical SDCWA Melded Treated rate from FY 16/17 and the projected Melded Treated rate through FY 26/27.

City Council Regular Meeting - Page 216 of 1385
Water Finances & Rates 13
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Figure W4: SDCWA Melded Treated Rate

The following table shows the projected water purchase costs used in the financial plan. Water supply costs assumptions are shown in detail in the appendix of this report.

Table W4: Projected Water Purchase Cost Summary

Capital Improvement Funding Needs
The District takes a proactive approach to maintaining its water system which requires ongoing investment in repair and improvement projects to maintain safe and reliable service. Accounting for construction cost inflation, the District anticipates funding approximately $34 million of water system capital improvement projects over the next 5 years, an average of $6.9 million per year. The proposed Projected Water Purchase Cost
Summary FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 SMCUP Camp Pendleton Charges $501,592 $526,672 $1,312,425 $1,364,922 $1,419,519 MWD Charges
MWD RTS Charge $264,456 $303,831 $343,644 $343,644 $343,644 MWD Capacity Charge $237,030 $200,804 $212,061 $238,483 $262,829 SDCWA Charges
Melded Treated Rate $6,950,291 $7,530,897 $5,187,830 $5,491,416 $5,784,941 SDCWA IAC $603,768 $623,819 $667,487 $714,211 $764,206
Supply Re liabilit y Charge $684,192 $731,886 $783,118 $837,936 $896,592 Customer Service Charge $555,840 $563,758 $591,946 $621,543 $652,621 Storage Charge $1,048,488 $1,070,518 $1,124,044 $1,180,246 $1,239,259 Special Ag Treated Rate (SAWR) $1,675,702 $1,804,625 $1,903,792 $2,007,981 $2,107,392 Water Purchase Costs $12,521,359 $13,356,811 $12,126,347 $12,800,383 $13,471,002 City Council Regular Meeting - Page 217 of 1385
Water Finances & Rates 14
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study rate increases are designed to enable the District to fund its capital improvement needs on a pay‐as‐ you‐go basis without incurring additional debt.

Ongoing Cost Inflation
The District’s water enterprise faces ongoing operating cost inflation due to annual increases in a range of expenses including staffing, utilities, insurance, supplies, etc. On top of rate increases needed for other purposes, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. Over the past 5 years, inflation has typically ranged between roughly 2% to 3%. In recent months, inflation has reached forty‐year highs with the CPI and ENR Construction Cost Index reaching roughly 9% in early 2022. However, inflation is not expected to remain at such elevated levels in future years.

4.3 Cash Flow Projections with Existing Rates
Based on the financial projections, without any rate increases the District would operate at a deficit and gradually deplete the water enterprise’s fund reserves within five years. The following figure shows a 5‐year projection of expenses broken down by key categories, projected annual revenues with no rate increases, and ending reserves compared to the reserve target.

Figure W5: 5‐Year Cash Flow Projection Without Rate Increases

City Council Regular Meeting - Page 218 of 1385
Water Finances & Rates 15
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

4.4 Cash Flow Projections and Recommended Rate Increases A summary of the cash flow projections is displayed in the following table. The overall rate revenue increases shown on the table are designed to fund the District’s cost of providing service, maintain roughly balanced budgets, maintain healthy debt service coverage, and meet long‐term fund reserve targets. The projections indicate the need for 6.5% increases to water rate revenues each of the next five years. Actual impacts to customers’ water bills will vary the first year based on customer class and water use due to proposed modifications to the rate structure and the updated cost‐of‐service analysis. Future water rate increases starting January 1, 2024, are applied on an across‐the‐board basis with the same percentage increase to all water rates in future years.

Table W5: Proposed Water Rate Adjustments

Figure W6 shows a 5‐year projection of expenses broken down by key categories and projected annual revenues with proposed rate increases. The table also compares fund reserves at the end of each fiscal year to annual fund reserve targets.

W Financial Dashboard FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Water Rev Adjustments 6.50% 6.50% 6.50% 6.50% 6.50%
Projected Maximum Rate Revenue Increases
Key Financial Information
Revenue from Full Year Rate Increase $1,599,000 $1,705,489 $1,819,071 $1,940,216 $2,069,430 Total Revenue $29,041,478 $30,858,035 $32,920,485 $35,035,639 $37,304,291 Total Expenses $29,965,318 $33,684,448 $32,799,776 $34,068,053 $35,298,291 Net Cash Change (Exl. Debt  Proceeds) ‐$923,840 ‐$2,826,413 $120,709 $967,585 $2,006,000 Total Reserves $23,062,452 $20,236,039 $20,356,748 $21,324,334 $23,330,334 Reserves Over/Under Target $2,197,291 ‐$1,713,938 ‐$1,240,524 ‐$847,941 $574,383 Water Debt Service Coverage (1.3x Target) 4.97x 2.41x 3.36x 3.69x 4.07x City Council Regular Meeting - Page 219 of 1385
Water Finances & Rates   16
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Figure W6:  Projected Revenues & Expenses

Detailed water enterprise financial projections described in Sections 4.1 and 4.2 are shown in the following table.
$0
$5
$10
$15
$20
$25
$30
$35
$40
FY 2023 FY 2024 FY 2025 FY 2026 FY 2027
Millions
Water
Supply
Costs
PAYGO
Capital
Debt
Service
O&M
Expenses
Proposed
Revenue
City Council Regular Meeting - Page 220 of 1385
Water Finances & Rates 17
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W6: Detailed Water Financial Projections

REVENUES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
Revenues from Rates
Revenues from Current Rates $24,600,000 $24,636,900 $24,673,855 $24,710,866 $24,747,932 Proposed Rev Adjustments $799,500 $2,454,143 $4,221,384 $6,108,723 $8,124,165 Subtotal Revenues from Rates $25,399,500 $27,091,043 $28,895,239 $30,819,590 $32,872,097 Other Operating Revenues
Pass‐through Charges
MWD RTS Charge $130,551 $0 $0 $0 $0
SDCWD IAC Charge $603,768 $623,819 $667,487 $714,211 $764,206 Sundry $53,009 $53,009 $53,009 $53,009 $53,009
Subtotal Other Operating Revenues $787,328 $676,828 $720,496 $767,220 $817,215 Non‐Operating Revenues
Water Availability Charge $208,842 $208,842 $208,842 $208,842 $208,842 1% Property tax $520,031 $525,231 $530,484 $535,788 $541,146 Interest $143,918 $230,625 $303,541 $305,351 $319,865
Water Capital Impr. Charge $1,593,121 $1,747,881 $1,878,972 $2,010,500 $2,151,235 Pumping Capital Impr. Charge $16,378 $0 $0 $0 $0
Facility Rent $261,189 $266,413 $271,741 $277,176 $282,720 Water Capacity Fees $111,172 $111,172 $111,172 $111,172 $111,172 Subtotal Non‐Operating Revenues $2,854,650 $3,090,163 $3,304,751 $3,448,829 $3,614,979 TOTAL REVENUES $29,041,478 $30,858,035 $32,920,485 $35,035,639 $37,304,291 EXPENSES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Pro jected Pro jected Pro jected Pro jected
Operating Expenses
Water Supply Costs
MET/CWA Purchased Water Costs $10,344,065 $11,025,514 $8,910,130 $9,427,479 $9,944,090 SAWR $1,675,702 $1,804,625 $1,903,792 $2,007,981 $2,107,392 SMCUP Supply* $501,592 $526,672 $1,312,425 $1,364,922 $1,419,519 Treatment $885,922 $1,734,082 $1,817,196 $1,892,589 $1,971,134 Production & Distribution $1,166,941 $1,244,847 $1,314,947 $1,375,043 $1,437,918 Pipeline Maintenance & Construction $529,956 $569,653 $604,790 $634,042 $664,717 System Services $690,262 $739,153 $782,767 $819,590 $858,162 Allocated Admin Expenses $5,904,708 $6,224,237 $6,517,324 $6,791,729 $7,077,795 Subtotal Operating Expenses $21,699,149 $23,868,782 $23,163,371 $24,313,376 $25,480,728 Non‐Operating Expenses
Water Existing Debt $1,477,819 $2,903,644 $2,903,644 $2,903,644 $2,903,644 PAYGO Capital $6,788,350 $6,912,022 $6,732,761 $6,851,033 $6,913,919 Subtotal Non‐Operating Expenses $8,266,169 $9,815,666 $9,636,405 $9,754,677 $9,817,563 TOTAL EXPENSES $29,965,318 $33,684,448 $32,799,776 $34,068,053 $35,298,291 NET REVENUES $7,342,329 $6,989,253 $9,757,114 $10,722,262 $11,823,563 NET CASH CHANGE EXCL. NEW DEBT PROCEEDS ($923,840) ($2,826,413) $120,709 $967,585 $2,006,000 BEGINNING BALANCES $23,986,292 $23,062,452 $20,236,039 $20,356,748 $21,324,334 ENDING BALANCES W/O DEBT PROCEEDS $23,062,452 $20,236,039 $20,356,748 $21,324,334 $23,330,334 City Council Regular Meeting - Page 221 of 1385
Water Finances & Rates 18
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 5 PROJECTED WATER DEMAND AND CUSTOMER CHARACTERISTICS

5.1 FPUD Water Supply and Metered Water Demand Projection BWA reviewed the last 6 years of metered water demand and total water supply. Projected FY 22/23 water demand is based on an average of the lowest three years in that period – FY 18/19, FY 19/20, and FY 21/22 – to provide a slightly‐conservative and reasonable basis for demand projections.

Conservative water demand projections are used to ensure rate revenue is sufficient and to reflect increased water conservation. All class and tier demand percentages are based on the average of actual FY 18/19, FY 19/20, and FY 21/22 metered water demand (water sales). The projected water loss was based on the six year average, as water loss is not related to water demand.

Table W7: Historic and Projected Water Supply and Metered Demand

Source: Actual water supply, water loss, and metered water sales provided the District.

5.2 Water Services and Equivalent Capacity
The following table contains the counts of water services and calculations of equivalent meter units (EMU)s. Each connection to the District’s water system is a considered one service. The EMUs for each meter size are based on the meter equivalent ratio. The meter equivalent ratios used in this report are in proportion to the maximum safe flow of a ¾” meter, 30 gallons per minute (GPM). This means a ¾” meter equals 1 EMU. A 1” meter with a maximum safe flow of 50 GPM will have a meter equivalent ratio of 1.67. EMUs are used for deriving fixed charges because they reflect system capacity. The total amount of EMUs in the District represent the total current capacity the District.

A small amount of District customers have locked meters. Meters are locked either by request of the customer or due to nonpayment. These customers are classified as Standby customers. They are segregated in the following table because they do not pay the full monthly fixed rates charged to active water customers.

Water Supply and
Metered Water Demand FY 16‐17 FY 17‐18 FY 18‐19 FY 19‐20 FY 20‐21 FY 21‐22 FY ‐22/23 Actual Actual Actual Actual Actual Actual Projected
Water Supply (AF) 9,211 9,181 8,043 7,986 8,918 7,950 8,000 Water Loss % 94.03% 94.34% 90.30% 90.03% 91.23% 95.05% 92.50% Me te re d Water Sales (AF) 8,661 8,661 7,263 7,189 8,136 7,556 7,400 Me te re d Water Sales (Kgal) 2,822,297 2,822,297 2,366,659 2,342,693 2,651,228 2,462,215 2,411,297 City Council Regular Meeting - Page 222 of 1385
Water Finances & Rates 19
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W8: Water Services and Equivalent Meter Units

Note: Customer counts by meter size provided by the District. AWWA maximum safe flow GPM based on the AWWA M1 Manual, Appendix B, Equivalent Meter Ratios.

Count of Services
Water
Services
Standby
Services Fire Services Total Services Total Annual Services Connection Size # # # # #
3/4" 6,642         7                     ‐                          6,649                           79,788 1" 1,895         ‐                       ‐                          1,895                           22,740 1 1/2" 397             1                     ‐                          398                              4,776 2" 195             1                     5                        201                              2,412 3" 18               1                     8                        27                                 324 4" 5                 1                     39                      45                                 540 6" 5                 2                     37                      44                                 528 8" ‐                 ‐                       4                        4                                   48 Total 9,157         13                   93                      9,263                           111,156 Service Capacity
Water
Services
AWWA
Maximum
Safe GPM
Meter
Equivalent
Ratios
Equivalent Meter
Units (EMU)s Total Annual EMUs
Meter Size # # # EMU EMU
Active Water Services
3/4" 6,642         30                   1.00                   6,642                           79,704 1" 1,895         50                   1.67                   3,165                           37,976 1 1/2" 397             100                 3.33                   1,322                           15,864 2" 195             160                 5.33                   1,039                           12,472 3" 18               320                 10.67                192                              2,305 4" 5                 500                 16.67                83                                 1,000 6" 5                 1,000             33.33                167                              2,000 Total 9,157         12,610                         151,321 Standby Water Services
3/4" 7                 30                   1.00                   7                                   84 1" ‐                 50                   1.67                   ‐                                     ‐ 1 1/2" 1                 100                 3.33                   3                                   40 2" 1                 160                 5.33                   5                                   64 3" 1                 320                 10.67                11                                 128 4" 1                 500                 16.67                17                                 200 6" 2                 1,000             33.33                67                                 800 Total 13               110                              1,316 Active and Standby Water Services
3/4" 6,649         30                   1.00                   6,649                           79,788 1" 1,895         50                   1.67                   3,165                           37,976 1 1/2" 398             100                 3.33                   1,325                           15,904 2" 196             160                 5.33                   1,045                           12,536 3" 19               320                 10.67                203                              2,433 4" 6                 500                 16.67                100                              1,200 6" 7                 1,000             33.33                233                              2,800 Total 9,170         12,720                         152,637 City Council Regular Meeting - Page 223 of 1385
Water Finances & Rates   20
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

5.3 Fire Service Capacity
The following table contains the counts of fire services and calculations of equivalent fire units (EFU)s used for deriving the fixed fire service charges. According to the M1 Manual, fire capacity is equal to the service size raised to the 2.63 power. The Fire Capacity Factors are the product of this calculation.

The Equivalent Fire Unit Ratios are derived by calculating the Fire Capacity Factor equivalent to a 2” service. The District’s fire service capacity includes the capacity of fire hydrants and private firelines connected to the District’s water system.

Table W9: Water Services and Equivalent Units

Note: Count of fire services provided by the District.

Fire Service Size
Number of
Services
Fire
Capacity
Factor
Equivalent
Fire Unit
Ratios (EFU)
Fire
Capacity
EFUs
Fire
Capacity %
Annual Fire
Services
Annual
EFUs
Service Size" ## E F U E F U %##
Public Hydrants
6 1,600 111 17.98 28,768 96.4% 345,216
Private Fireline Services
2 5 6.19 1.00 5 60 60
3 8 17.98 2.90 23 96 278
4 39 38.32 6.19 241 468 2,897
6 37 111.31 17.98 665 444 7,983
84 237.21 38.32 153 48 1,839
Total Private Firelines 93 1,088 3.64% 1,116 13,058
Total Fire Protection 1,693 29,856 1,116 358,274
City Council Regular Meeting - Page 224 of 1385
Water Finances & Rates 21
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 6 WATER DEMAND CATEGORIZATION AND SUPPLY UTILIZATION

6.1 Water Demand Categorization
In order to proportionally allocate costs to the District’s customer classes, water demands were split into groups by demand category. The sum of the groupings of demand in each category equal the District’s total projected demand. A demand category is related to how the District incurs costs e.g., some of the District’s costs are related to all of the District’s water demand, while some costs are only related to M&I demands. The demand categories are organized into a hierarchy where the District’s demands are separated into progressively smaller groups. The categories and groups were based on BWA’s review of District operations and input from District staff. The primary output of this categorization is to identify the water use and applicable costs associated different types of water demands.

The following figure shows the District’s water demands in a larger framework that categorizes different types of water demands for purposes of allocating costs to different types of use. The categories correspond with the rate structure classes and components developed in this report.

Figure W7: FPUD Water Demand Categorization Levels

Demand Type and Water Demand Classes
The District’s total demand can be separated into two distinct water demand types: Municipal and Industrial (M&I) demand and Agricultural (Ag) demand. Ag water is used by customers who have met the criteria to enroll in the FPUD commercial agricultural program or the SDCWA special agricultural Rate Tiers
Customer Class
Demand Class
Demand Type
Total Water Demand District Water
Demand
Ag
Commercial
Ag
Commercial Ag
(CA, AT, CB)
SAWR
SAWR
(AS, AT)
M&I
Residential
Residential
(D, LD, M, AT, CB)
Residential
Tier 1
Residential
Tier 2
Non‐
Residential
Non‐Residential
(I,G,C)
City Council Regular Meeting - Page 225 of 1385
Water Finances & Rates 22
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study water rate (SAWR) program. Ag water is less reliable which leads to it being less expensive than M&I water. A description of each demand type is as follows:
 Municipal and Industrial (M&I) ‐ M&I customers are provided a higher level of water supply reliability and are last in line for mandatory water use cutbacks if required by MWD or SDCWA due to water supply shortages. Additionally, M&I customers have first priority for use of local water supplies, which are the District’s most reliable source of supply. To receive the higher level of supply reliability, M&I customers pay the wholesale water supply reliability charges and local water supply costs.
 Agricultural (Ag) ‐ Water service to Ag customers is ultimately interruptible as Ag water use is first in line for mandatory cutbacks if ever needed due to water supply shortages. As such, Ag customers do not pay for wholesale water reliability charges or local water supplies costs.

The District’s Ag water demands are met via imported water purchased from SDCWA, which in turn obtains most of its water from MWD.

For the purposes of developing rates that reflect the cost of service, Ag demand and M&I demand are both bifurcated into two demand classes. Ag demand is bifurcated into 1) the SAWR demand class which consists of Ag customers who have enrolled in the Special Agricultural Water Rate (SAWR) program and receive the discounted SAWR rate for their eligible Ag use from SDCWA and 2) the Commercial Ag demand class which consists of customers who are not enrolled in the SAWR program but do meet the District’s criteria to receive wholesale water at the Commercial Ag rate.

M&I demand is bifurcated into 1) a residential demand class which includes single‐family, multi‐family and other domestic/residential usage and 2) a non‐residential demand class which includes commercial, governmental and irrigation accounts. The following table shows a breakdown of the projected water demand for each of the District’s demand classes.

Table W10: Projected FY 22/23 Water Demand by Demand Class

*Based on projected FY 22/23 water demands proportionally adjusted to reflect the average actual use by customer class in FY 18/19, FY 19/20, and FY 21/22.

FPUD Water Water Demand by Demand Class (Kgal) Total
District Water Demand
2,411,297 2,411,297
AG M&I
760,944 1,650,354 2,411,297
SAWR Commercial Ag Residential Non‐Residential
441,755 319,189 1,452,252 198,102 2,411,297
Total Water Demand
Demand Type
Demand Class
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Water Finances & Rates 23
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Customer Classes and Tiers
Agricultural Water Demand Classes
The SAWR demand class includes the Agriculture SAWR (AS) customer class and the third tier of the Agriculture Domestic (AT) customer class which accounts for SAWR water used for agricultural purposes.

The Commercial Ag demand class includes the Commercial Ag (CA) customer class as well as the second tier of the Agriculture Domestic (AT) and Commercial Domestic Ag (CB) customer classes which receive the Commercial Ag rate water.

M&I Water Demand Classes
The residential demand class includes all tiers of the Domestic (D), Large Domestic (LD), and Multi‐ Unit (M) customer classes as well as the first tiers of the Agriculture Domestic (AT) and Commercial Domestic Ag (CB) classes which account for indoor water use in residences on an agricultural lot. The non‐residential demand class includes the Commercial (C), Government (G), and Irrigation Only (I) customer classes.

The following table shows the demand class associated with each customer class and tier.

Table W11: Demand Class Supply by Customer Class & Tier

Customer Class
SAWR
Demand
Class
Commercial
Ag Demand
Class
M&I Demand
Class
Agri cul ture SAWR (AS) x
Commerci al Ag (CA) x
Agri cul ture Domestic (AT)
Ti er 1 (0‐5 Kgal) x
Ti er 2 (6‐17 Kgal) x
Ti er 3 (>17 Kgal) x
Commerci al Domestic Ag (CB)
Ti er 1 (0‐5 Kgal) x
Ti er 2 (>5 Kgal) x
Domestic (D/ LD)
Ti er 1 (0‐5 Kgal) x
Ti er 2 (6‐30 Kgal) x
Ti er 3 (>30 Kgal) x
Multi‐Uni t (M)
Ti er 1 (0‐5 Kgal) x
Ti er 2 (6‐30 Kgal) x
Ti er 3 (>30 Kgal) x
Commerci al (C) x
Government (G) x
Irrigation Only (I) x
City Council Regular Meeting - Page 227 of 1385
Water Finances & Rates 24
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The following table shows a detailed breakdown of projected FY 22/23 water use by customer class and tier.

Table W12:  Projected Water Use by Customer Class & Tier Customer Class
Projected FY 22/23
Demand (Kgal)* Services
Agriculture SAWR (AS) 194,152 61
Commercial Ag (CA) 140,720 118
Agriculture Domestic (AT)
Tier 1 (0‐5 Kgal) 7,504
Tier 2 (6‐17 Kgal) 15,926
Tier 3 (>17 Kgal) 247,603
Commercial Domestic Ag (CB)
Tier 1 (0‐5 Kgal) 12,270
Tier 2 (>5 Kgal) 162,543
Domestic (D/ LD)      7,773
Tier 1 (0‐5 Kgal) 407,374
Tier 2 (6‐30 Kgal) 829,549
Multi‐Unit (M)    218
Tier 1 (0‐5 Kgal) 166,320
Tier 2 (6‐30 Kgal) 29,236
Commercial (C) 150,254 579
Government (G) 40,176 29
Irrigation Only (I) 7,671 12
Total 2,411,297 9,157
Note: Based on projected FY 22/23 water demands proportionally adjusted to reflect the average actual use by customer class in FY 18/19, FY 19/20, and FY 21/22.

City Council Regular Meeting - Page 228 of 1385
Water Finances & Rates 25
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The following table shows projected water use by customer class and demand class. Residential water use is shown for 2 tiers in line with the proposed water rate structure.

Table W13:  Projected FY 22/23 Water Use by Demand Class & Tier Projected Water Demand Total Residential M&I     Total Kgal % % %
Residential
Tier 1 (D, LD, M, AT, CB) 593,467 40.87%
Tier 2 (D, LD, M) 858,785 59.13%
Total Residential 1,452,252 100.00% 88.00%
Commercial (C) 150,254    9.10%
Government (G) 40,176    2.43%
Irrigation Only (I) 7,671    0.46%
Total M&I 1,650,354    100.00% 68.44%
Ag SAWR (AS, AT, CB)
441,755         18.32%
Commercial Ag (CA, CB) 319,189       13.24%
Total 2,411,297       100.00%

6.2 FPUD Water Supplies
The District has two imported and two local water supplies. For the purposes of this study, imported water from SDCWA is treated as two distinct types of water supply since SAWR water is provided to the District at a lower rate and is only available for customers enrolled in the SAWR program. This report also considers all water entering the District’s water system from the Red Mountain UV treatment facility to be Red Mountain water supply even though a portion of that water may include SMCUP water pumped to the Red Mountain Reservoir to supplement water storage.

The following table shows a breakdown of the District’s projected water supply available to meet projected water demands. Water supply volumes for FY 26/27 were used to reflect the average volumes of water from different sources after water generated from the SMCUP is fully integrated into the District’s water supply. These sources of water supply are subsequently allocated to different types of water use in line with how the District meets the water demands for each customer class.

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Water Finances & Rates   26
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W14:  Projected Water Supply to Meet Metered Water Demand Projected FBUD Water Supplies and Demand
Water
Supply
(FY 26/27) Water Supply
Projected Metered
Water Demand
(FY 22/23)
AF % Kgal
Red Mountain (Well)2 85 1.06% 25,467
Red Mountain (SMCUP)1,2 339 4.21% 101,568
SMCUP1 2,761 34.31% 827,224
SDCWA Water (SAWR Rate) 4   1,474 18.32% 441,755
SDCWA Water (Blended Treated Rate) 3 3,389 42.11% 1,015,283 Total 8,048 100.00% 2,411,297
1‐ Projected SMCUP supply reduced by amount used to fill Red Mountain Reservoir. Districts projects it will be filled once per year.

For the purposes of this study all water treated at the Red Mountain UV treatment plant is considered Red Mountain supply as it is used to meet peak water demands.

2‐Red Mountain Well, SMCUP and SAWR Rate SDCWA Water projections are based on FY 22/23 projections provided by the District increased by projected growth.
3‐ SDCWA Blended Treated Rate Water is projected to meet water demands not fulfilled by other sources. 4‐ SDCWA SAWR Rate Water is projected based on the usage of District customers with SAWR agreements with SDCWA.

6.3 Water Supply Utilization by Demand Classes
M&I Water Supply
Water supply for M&I water demand is provided by a combination of water supply sources including:
a) SMCUP water to meet base water demands, b) SDCWA Melded Treated Rate water to meet demand up to peak summer demands, and finally c) water from the Red Mountain facilities to help meet peak water demands during the highest‐use summer months. The District only uses the Red Mountain facilities during times of peak system demand because the facilities are expensive to start and operate. Red Mountain facilities are also critical to helping the District maintain adequate water pressure during periods of peak system demands due to their high elevation.

Agricultural Water Supply
Water supply for SAWR customers is provided by lower‐cost SAWR water to the extent such water is provided by SDCWA. All remaining SAWR demand and Commercial Ag demand is supplied by water purchased at the SDCWA Melded Treated Rate water.

The following table and figure show a breakdown of the District’s sources of water supply used to meet the demands of each customer class.

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Water Finances & Rates   27
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W15:  Water Supply Utilization by Demand Class
FPUD Demand Classes Unit
SAWR
Demand
Class
Commercial
Ag Demand
Class M&I Demand
Total FPUD
Demand
Use Type    Ag Ag M&I All
Projected Demand % 18.32% 13.24% 68.44% 100.00%
Projected Demand   Kgal 441,755 319,189 1,650,354 2,411,297

SDCWA Water (SAWR Rate) Kgal 441,755 0 0 441,755
SMCUP Kgal 0 0 827,224 827,224
Red Mountain Kgal 0 0 127,035 127,035
SDCWA Water (Melded Treated
Rate) Kgal 0 319,189 696,094 1,015,283

Figure W8: Supply Utilization by Demand Class (Kgal)

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Water Finances & Rates 28
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

6.4 M&I Use Categories
To fairly allocate costs to each M&I demand class and eventually each residential tier, M&I demand is split into use categories. The purpose of splitting M&I demand into use categories is to identify how each M&I demand class utilizes available water supplies. The water demand identified in each use category is based on the proportion of actual average use in FY 18/19, FY 19/20 and FY 21/22 applied to the projected FY 22/23 M&I demands.

M&I Use Category Descriptions
Winter use in this study is defined as use that is at or below the average winter demand of December, January, and February. This is essentially the minimum level of demand the District consistently serves year round.

Average use in this study is defined as use greater than average winter demand of December, January, and February through annual average demand. Winter Average through Average use is the level of demand considered base demand in the Base‐Extra Capacity Method, described in the AWWA M1 Manual.

Summer use in this study is defined as use greater than the annual average demand through the average summer demand in the months of June through October.

Peak use in this study is defined as use greater than the summer average demand in the months of June through October. Use in this category includes maximum day and maximum hour demands.

The following table shows the use category thresholds for each use category based on the descriptions above and the total projected M&I demand in FY 2022/23.

Table W16:  M&I Use Categories
Demand
Categories
Use Category
Threshold
Projected
FY 22/23
M&I Use M&I Water Use
Kgal Kgal %
Winter 89,602 1,066,342 64.61%
Average 137,529 461,345 27.95%
Summer 176,619 87,401 5.30%
Peak    35,267 2.14%
Total M&I    1,650,354 100%

City Council Regular Meeting - Page 232 of 1385
Water Finances & Rates 29
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The following figure illustrates how water use falls into the use categories over the course of a year.

Figure W9: Projected FY 22/23 M&I Use and Water Use Categories

M&I Supply Utilization by Use Category
As described above, M&I demand utilizes SMCUP water to supply base water demands, SDCWA Melded Treated Rate water to supply demand that exceeds SMCUP supply and is not supplied by the Red Mountain facilities. The District only uses the Red Mountain facilities during times of peak system demand because the facilities are expensive to startup. Red Mountain facilities are also critical in helping the District maintain pressure during peak system demands due to their high elevation.

To allocate the cost to serve each use category, the supply utilization of each use category was determined. The water supply utilization of each use category was determined by exhausting the supply used to meet base demands (SMCUP) through the use categories from base to peak. Purchased SDCWA water fulfills the demand between SMCUP and the peak demands met by Red Mountain. 0 50,000
100,000
150,000
200,000
250,000
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
M&I Water Use Categories
Total M&I
Summer Avg.

Average
Winter Avg.

Winter
Average
Summer
Peak
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Water Finances & Rates 30
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The supply utilization by use category is shown in the following table and figure.

Table W17:  M&I Supply Utilization by Use Category
M&I Supply
Utilization
Total
Demand
Projected
FY 22/23
Demand SMCUP   SDCWA
Red
Mountain
% Kgal Kgal Kgal Kgal
M&I Demand    1,650,354 823,929 699,896 126,529

Winter 64.61% 1,066,342 827,224 239,117 0
Average 27.95% 461,345 0 456,977 4,367
Summer 5.30% 87,401 0 0 87,401
Peak 2.14% 35,267 0 0 35,267

Figure W10: M&I Supply Utilization by Use Category (Kgal)

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Water Finances & Rates 31
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Use Category Utilization by Tier
In order to develop rates that reflect the underlying costs of service for each residential tier, the volume of water in each use category (e.g., winter, average, summer and peak use) in each residential tier must be identified. Water use in each tier is based on average annual monthly tier usage percentages from FY 18/19, FY 19/20 and FY 21/22 applied to the projected FY 22/23 water demand to determine the demand in each use category for each tier. The following figure shows the water use categories that comprise each tier.

Figure W11: Tier Demand and Use Categories

The following figure shows the total demand in each use category by tier.

Figure W12: Use Categories by Tier

0 20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Tier Demand by Use Categories
Tier 2
Tier 1
Winter Average
Average
Summer Avg.Winter
Average
Summer
Peak
‐
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
Tier 1 Tier 2
Use Category By Tier
Peak
Summer
Average
Winter
City Council Regular Meeting - Page 235 of 1385
Water Finances & Rates 32
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 7 WATER COST OF SERVICE RATE ANALYSIS
The AWWA M1 Manual outlines the two most widely used methods for allocation of costs which are the a) base‐extra capacity method and b) the commodity demand method. Both methods recognize that the cost of serving a customer depends not only on the total volume of water used, but also on the rate of use or peak‐demand requirements.

Similar to the previous rate study, the proposed rates presented in this study are developed using a base‐extra capacity method. When using the base‐extra capacity method, costs are typically separated into fixed and variable cost components. The variable cost components consist of costs associated with (1) Base (average water use) and (2) Extra Capacity (water use in excess of average use). As noted in the AWWA M1 Manual, in detailed rate studies (such as the one performed for this study) some of these elements might be broken down further into two or more subcomponents.

In this study, fixed capacity‐related costs are recovered based on meter size and capacity. Meter capacity ratios provide a basis for charging customers based on the proportionate amount of water system capacity required for serving each meter size. Larger meters place a greater demand on the water system and are correspondingly charged higher fixed rates that reflect their proportionate level of water system capacity needs.

The proposed rates are developed based on a detailed cost allocation that reflects the District’s costs of providing service based on analysis of operations and input from District staff. As part of the process, BWA met with District staff from finance, administration, engineering, and operations to gain input on water system design and operations.

The following chart shows the general process for deriving water rates that reflect the District’s costs of service to each customer class.

City Council Regular Meeting - Page 236 of 1385
Water Finances & Rates 33
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Figure W13: Cost of Service Analysis Process

7.1 Revenue and Expense Allocation Categories
The first step in the cost of service evaluation process is to develop allocation categories where revenues and expenses related to the same purpose are grouped together. An example of this process is grouping expenses related to production and distribution into the Production and Distribution allocation category. BWA worked with District staff to analyze the District’s budget on a line‐by‐line basis and to assign each expenditure and revenue to the appropriate allocation category. The Expenses are grouped into categories that represent different types of costs incurred in providing water service (e.g. water supply sources, production and distribution, administration, etc.) Allocation
Categories
Each type of expense is subsequently allocated into functional components that reflect different aspects of District water service in order to identify the percentage of District costs related to each function.

Functional
Allocation
The percentage of costs related to each function is then multiplied by the District's projected water rate revenue requirement to determine the amount of revenues that need to be recovered from each functional component.

Functional Revenue
Requirements
The amount of revenues allocated to each functional component is divided by the number of applicable units to develop a unit cost (e.g. costs related to capacity are divided by applicable number of meter equivalents, costs related to each type water supply are divided by the projected volume of applicable water sales).

Unit Cost
Unit costs are then applied to the projected demand characteristics of each customer class to determine a total cost to be recovered from each type of fixed and volumetric charge per customer class. The total costs allocated to each rate component are then divided by the total number of billable units (e.g. meter equivalents, water sales) to determine fixed and volumetric water rates.

Rate Derivation
City Council Regular Meeting - Page 237 of 1385
Water Finances & Rates 34
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study following contains descriptions of the allocation categories and an explanation of how they are allocated to functional components:

 MET/CWA Blended Rate is the amount paid to SDCWA for wholesale water at the Melded Treated rate. It was allocated to the Melded Rate Water functional component.  MWD RTS Charge is a fixed charge imposed by MWD. All active water customers benefit from the availability of wholesale water, so these costs were allocated to the water capacity functional component.
 MWD Capacity Charge is a fixed charge imposed by MWD. All active water customers benefit from the availability of wholesale water so these costs were allocated to the water capacity functional component.
 CWA Customer Service Charge is a fixed charge imposed by SDCWA. All customers benefit from the customer service functions so these costs were allocated to the standby capacity functional component.
 CWA Supply Reliability Charge is a fixed charge imposed by SDCWA. The projects funded with this charge provide for increased water supply reliability to M&I customers. This charge is allocated to the Supply Reliability functional component.
 SAWR expense is amount paid to SDCWA for wholesale water at the Special Agricultural Water Rate (SAWR). It was allocated to the SAWR Rate Water functional component.  SMCUP expenses are the District’s cost to operate and maintain the Santa Margarita Conjunctive Use Project facilities and the variable costs paid to Camp Pendleton for use of its facilities. SMCUP were allocated to the SMCUP and the Red Mountain functional components based on the projected utilization of the SMCUP supply. SMCUP water is project to be used to fill the Red Mountain Reservoir once per year.
 Supply Reliability expenses are costs related to improving and maintaining water supply reliability. They include fixed wholesale costs related to water reliability as well as fixed costs related to local water supplies. Supply Reliability expenses were allocated to the Supply Reliability functional component.
 SDCWD IAC Charge is the fixed SDCWA charge the District recovers from customers as a pass through charge. The SDCWD IAC Charge is recovered as a passthrough charge and is not allocated to functional components.
 Production & Distribution expenses are capital and O&M costs related to production and distribution. Pumping charge revenues reduce the amount of production and distribution that need to be recovered from rates. The portion of Production & Dist. expenses directly related to Red Mountain operations were allocated to the Red Mountain functional component. The portion of Production & Dist. expenses related to private fire line costs were allocated to the Private Fire Capacity functional component. The remainder of Production & Dist. are related to delivering water to all water customers and are allocated to the All Volume functional component.

City Council Regular Meeting - Page 238 of 1385
Water Finances & Rates 35
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  Pipeline Maintenance & Const. expenses are capital and O&M costs related to pipeline maintenance and construction. The portion of Pipeline Maint. & Const. expenses related to private fireline costs were allocated to the Private Fire Capacity functional component. The remainder of Pipeline Maint. & Const. costs allocated between the Water Capacity and All Volume functional components to reflect standing capacity and demand capacity of pipelines.  System Services are costs associated with providing and maintaining customer water meters including meter testing and replacements. Backflow device fees offset the backflow costs included in this category. System Services expenses were allocated to the Water Meter Service functional component.
 Administration expenses are related to the water enterprise’s portion of the District’s administrative costs. The portion of Administration expenses related to private fireline costs were allocated to the Private Fire Capacity functional component. The portion of Administration expenses related to customer service and billing were allocated to the Customer functional component. The portion of Administration expenses related to providing and maintaining customer water meters were allocated to the Water Meter Service functional component. The portion of Administration expenses related to conservation programs were allocated to the Conservation functional component. The remainder of the Administration costs were allocated to functional components related to system capacity, 60% of administrative costs were allocated to the Water Capacity functional component because administrative costs are fixed on an annual basis and the remainder were allocated to the All Volume functional component.  Benefits expenses are employee costs which are not salaries. Benefit expenses were allocated to functional components based on the allocations of SMCUP, Production & Dist., Pipeline Maint. & Const., System Services, and Administration allocation categories weighted by the salary amount in each component.
 Water System expenses are the costs of capital projects related to the water system. The portion of Water System expenses related to private fire line costs were allocated to the Private Fire Capacity functional component. The remainder of Water System costs were allocated between the Water Capacity and All Volume functional components to reflect standing capacity and demand capacity. A greater portion of these costs were allocated to the Water Capacity functional component because these costs are mostly one‐time or fixed costs.  As All Other expenses and revenues are revenues not related to a specific function and are allocated proportionally based on the allocation of all the other categories causing thing this category to have no impact on the functional allocation.

The following table shows the expenses and offsetting revenues in each allocation category. The final allocation amount for each allocation category is the net of expenses less offsetting revenues. The allocation amounts for operating costs are based on the projected revenues and expenses in the final year of the Proposition 218 notice period (FY 2026/27) as show in Section 4.4. Capital costs are based City Council Regular Meeting - Page 239 of 1385
Water Finances & Rates 36
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study on the average annual funding levels over the five‐year period adjusted for inflation to be consistent with FY 2026/27. Operating and maintenance expenses are based on FY 2026/27, the final year of the Proposition 218 notice period, because revenues and expenses are building to support operations which fully incorporate the SMCUP supply and associated costs, which will be incorporated by FY 2026/27. Expenses in FY 2026/27 reflect what will be the new normal for District operations. Capital costs were allocated based on a projected five year average, inflated to FY 2026/27 dollars to reflect the average annual level of capital funding to be supported by the proposed rates.

Table W18: Allocation Categories for Functional Allocation

7.2 Allocations Between Fixed Capacity and Variable Water Usage Functions Utilities have used a wide range of approaches or perspectives for allocating and recovering their costs for providing service and these costs are most commonly recovered from a combination of fixed and variable charges. The percentage of revenues derived from the fixed and variable charges should be proportional to each system’s expenditures and must not exceed the cost of providing service.

Many of the District’s costs are fixed costs that do not vary by the level of service provided, such as operational and staff costs, as well as costs for building and maintaining infrastructure. Some of these Allocation Category
Allocation
Expenses
Offsetting
Revenues
Allocation
Amount Total
MET/CWA Blended Rate $5,784,941 $5,784,941 100%
MWD RTS Charge $343,644 $343,644 100%
MWD Capacity Charge $262,829 $262,829 100%
CWA Customer Service Charge $652,621 $652,621 100%
CWA Supply Re liabilit y Charge $2,135,850 $2,135,850 100% SAWR $2,107,392 $2,107,392 100%
SMCUP $3,390,653 $3,390,653 100%
Supply Reliability $2,755,117 $508,842 $2,246,275 100%
SDCWD IAC Charge $764,206 $764,206 $0 0%
Production & Dist. $1,437,918 $212,744 $1,225,175 100%
Pipeline Maint. & Const. $5,978,708 $1,517,982 $4,460,726 100% System Services $882,894 $7,065 $875,829 100%
Administration $5,566,099 $70,650 $5,495,449 100%
Benefits $1,511,696 $1,511,696 100%
Water System $2,729,798 $666,710 $2,063,088 100%
Functional Allocation $ $36,304,366 $3,748,198 $32,556,168 $32,556,168 Functional Allocation % 100% 100%
Revenue Requirement $26,199,000 $26,199,000
Projected FY 26‐27 Amounts
City Council Regular Meeting - Page 240 of 1385
Water Finances & Rates 37
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study costs are related to the number of customers but the majority of the fixed costs are related to the total capacity of the water system. Fixed costs related to system capacity can reasonably be apportioned by meter size or variable, usage‐based rate recovery in recognition that both units of measure reasonably reflect a customer’s portion of system capacity. For example, a share of the fixed cost of salaries related to water production can reasonably be recovered from usage‐based charges as these costs are incurred to provide water supply to meet customer demand of from a fixed charge based on a customer’s meter size which reflects the magnitude of water a customer can pull from the water system . Likewise, debt service payments may be fixed annual costs, but it is reasonable to recover some of these costs from usage‐based rates as the costs are incurred to fund infrastructure that will improve the water delivery system.

While there is no single correct approach, BWA believes that costs should be allocated within a reasonable range that reflects both a) underlying cost causation, to the extent such causation can reasonably be determined or estimated, and b) the policy preferences of the agency in cases where a range of reasonable approaches can be justified.

7.3 Functional Cost Allocation
The next step in the cost of service analysis is to allocate the net expenses (expenses less offsetting revenues) in each allocation category to the water enterprise’s functional components. While there is no single correct approach for cost allocation, BWA believes that costs should be allocated within a reasonable range that reflects both a) underlying cost causation, to the extent such causation can reasonably be determined or estimated, and b) the policy preferences of the agency in cases where a range of reasonable approaches can be justified. This process is intended to proportionately allocate costs to each functional component to determine the revenue requirement for each component. The allocations to each functional component were based on input from District staff and BWA analysis of customer, water supply, and metered water demand data. A description of the allocations is for each allocation category is included in Section 7.1. Supporting calculations for the allocations are included in Appendix A.

7.4 Allocation to Fixed Cost Functional Components
The following section describes the functional components where the revenue requirement is recovered from fixed units e.g., services, EMUs and EFUs.

Fixed Cost Functional Components
 Private Fire Capacity reflects the proportional costs to provide private fire protection capacity.

The revenue requirement for this functional category is recovered per equivalent fire capacity unit (EFU).

City Council Regular Meeting - Page 241 of 1385
Water Finances & Rates 38
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  Customer reflects billing and customer service costs that are the same for each customer regardless of meter size. The revenue requirement for this functional category is recovered on a per service basis.
 Water Meter Service reflects costs associated with servicing meters. The revenue requirement for this functional category is recovered per equivalent meter unit (EMU) of active and standby customers.
 Water Capacity includes fixed operating and capital costs related to system capacity. The revenue requirement for this functional category is recovered per equivalent meter unit (EMU) of active customers.
 Standby Capacity includes fixed costs related to serving active and standby services. The revenue requirement for this functional category is recovered per equivalent meter unit (EMU) of active and standby customers.

The following table shows a breakdown of the water utility’s allocation to fixed cost functional categories.

Table W19: Allocation to Fixed Cost Functional Components

A description of the allocations is for each allocation category is included in Section 7.1. Supporting calculations for the allocations are included in Appendix A. The Functional Allocation $ are calculated by taking the sum of the products of the allocation percentages in each functional component multiplied by the allocation amounts. The Functional Allocation % is calculated by dividing the Allocation Category
Allocation
Amount
Private Fire
Capacity Customer
Water Meter
Service
Water
Capacity
Standby
Capacity
MET/CWA Blended Rate $5,784,941
MWD RTS Charge $343,644 100.0%
MWD Capacity Charge $262,829 100.0%
CWA Customer Service Charge $652,621 100.0%
CWA Supply Re liabilit y Charge $2,135,850
SAWR $2,107,392
SMCUP $3,390,653
Supply Re liabilit y $2, 246, 275
SDCWD IAC Charge $0
Production & Dist. $1,225,175 0.1%
Pipe line Maint. & Const. $4,460,726 0.1% 50.0%
System Services $875,829 100.0%
Administration $5,495,449 0.1% 15.5% 3.9% 60.0%
Benefits $1,511,696 0.1% 7.6% 15.4% 35.6%
Water System $2,063,088 0.1% 69.9%
Functional Allocation $ $32,556,168 $10,533 $968,434 $1,325,837 $8,114,835 $652,621 Functional Allocation % 100% 0.03% 2.97% 4.07% 24.93% 2.00% Revenue Requirement $26,199,000 $8,477 $779,330 $1,066,944 $6,530,270 $525,185 City Council Regular Meeting - Page 242 of 1385
Water Finances & Rates 39
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Functional Allocation $ for each functional component by the total Functional Allocation $. The Functional Allocation % for each functional component is then multiplied by the total revenue requirement. The revenue requirement was identified in Section 4.4.

7.5 Fixed Cost Functional Component Unit Costs
The following table shows the allocation units and total revenue requirement by functional component. The allocation units used for each functional component are the units related to the service provided by the functional component. The revenue requirement divided by the allocation units for each functional component provide each functional component’s unit rate.

Table W20: Fixed Monthly Unit Costs by Functional Component

The following table describes the allocation units used to derive the unit cost by functional component.

Table W21: Fixed Allocation Units
Functional
Component Allocation Units
Allocation
Units
Unit of
Measure Description
Customer
Number of
Water Services 111,156 #
Total number of standby and active water services per
month
Water Meter
Service
All Equivalent
Meter Units 152,637 EMU
Total amount of active and standby water customer equivalent meter units per month
Water
Capacity
Active
Equivalent
Meter Units 151,321 EMU
Total amount of active water customer equivalent
meter units per month
Standby
Capacity
All Equivalent
Meter Units 152,637 EMU
Total amount of active and standby water customer equivalent meter units per month
Private Fire
Capacity
Private Fireline
Equivalent Fire
Units 13,058 EFU
Total amount of private fireline equivalent fire units per month

7.6 Function Allocation to Variable Cost Components
The following section describes the functional components where the revenue requirement is recovered from variable Kgal (1,000 gallon) units. The definition of the functional components and the units of demand associated with each category are as follows:

Allocation Units Customer
Meter
Service
Water
Capacity
Standby
Capacity
Private Fire
Capacity
Allocation Unit of Measure #E M UE M UE M U E F U
A llocat ion Units 111,156 152,637 151,321 152,637 13,058 Revenue Requi rement $779,330 $1,066,944 $6,530,270 $525,185 $8,477 Unit Cost $7.01 $6.99 $43.16 $3.44 $0.65
City Council Regular Meeting - Page 243 of 1385
Water Finances & Rates 40
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  All Volume costs are related to all water sold in the District and reasonably recovered volumetrically per unit of water sold by the district.
 SMCUP costs are driven by the acquisition and treatment of water related to the SMCUP and are reasonably recovered per unit of SMCUP water sold by the District.  Red Mountain costs are those associated with the Red Mountain facilities including the well, reservoir, UV treatment facility and the SMCUP water that is projected to fill the reservoir once per year. Red Mountain costs are reasonably recovered per unit of water treated at the Red Mountain UV treatment facility sold by the District.
 Supply Reliability costs are associated with providing increased supply reliability to all M&I demand including SMCUP debt service, SDCWA Supply Reliability Charges and SDCWA Storage Charges. Supply Reliability costs are reasonably recovered per unit of M&I water sold by the District.
 Blended Rate costs reflect the cost of water purchased from SDCWA at the Melded Treated rate and are reasonably recovered per unit of Melded Treated Rate water sold by the District.  SAWR Water costs reflect the cost of water purchased from SDCWA at the SAWR rate and are reasonably recovered per unit of SAWR water sold by the District.  Conservation costs are related to the District’s efforts to help M&I customers conserve water and reduce peak summer demands. conservation program. Conservation costs are reasonably recovered per unit of peak water sold by the District.

The following table shows a breakdown of the water utility’s allocation to variable cost functional components.

City Council Regular Meeting - Page 244 of 1385
Water Finances & Rates 41
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W22: Cost Allocation to Variable Cost Recovery Functional Components

A description of the allocations is for each allocation category is included in Section 7.1. Supporting calculations for the allocations are included in Appendix A. The functional allocation $ are calculated by taking the sum of the products of the allocation percentages in each functional component multiplied by the allocation amounts. The functional allocation % is calculated by dividing the functional allocation $ for each functional component by the total functional $. The functional allocation % for each functional component is then multiplied by the total revenue requirement. The revenue requirement was identified in section 4.4.

Allocation Category
Allocation
Amount All Volume SMCUP
Red
Mountain
Supply
Reliability
Melded
Rate Water
SAWR Rate
Water
Conservati
on
MET/CWA Blended Rate $5,784,941 100.0%
MWD RTS Charge $343,644
MWD Capacity Charge $262,829
CWA Customer Service Charge $652,621
CWA Supply Re liabilit y Charge $2,135,850 100.0%
SAWR $2,107,392 100.0%
SMCUP $3,390,653 89.1% 10.9%
Supply Re liabilit y $2, 246,275 100.0%
SDCWD IA C Charge $0
Production & Dist. $1,225,175 81.3% 18.7%
Pipe line Maint. & Const. $4,460,726 49.9%
System Services $875,829
Administration $5,495,449 18.5% 2.0%
Benefits $1,511,696 32.7% 6.0% 1.7% 1.0%
Water System $2,063,088 30.0%
Functional Allocation $ $32,556,168 $5,350,190 $3,110,044 $624,496 $4,382,125 $5,784,941 $2,107,392 $124,718 Functional Allocation % 100% 16.43% 9.55% 1.92% 13.46% 17.77% 6.47% 0.38% Revenue Requirement $26,199,000 $4,305,471 $2,502,753 $502,552 $3,526,438 $4,655,329 $1,695,887 $100,364 City Council Regular Meeting - Page 245 of 1385
Water Finances & Rates 42
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

7.7 Volumetric Unit Costs by Functional Components
The following table shows the allocation units and total revenue requirement by functional component. The allocation units used for each functional component are the units related to the service provided by the functional component. The revenue requirement divided by the allocation units for each functional component provide each functional component’s unit cost.

Table W23: Volumetric Unit Costs by Function

The following table describes the volumetric allocation demand units used to derive the unit cost by function.

Table W24: Volumetric Allocation Units
Functional
Component
Allocation
Units (Kgal) Description
All Volume 2,411,297 All projected units sold by the District SMCUP 827,224 Projected units from SMCUP sold by the District Red Mountain 127,035 Projected units from Red Mountain sold by the District Supply Reliability 1,650,354 Projected units sold to M&I customers Melded Rate Water 1,015,283
Projected units of water purchased from SDCWA at the Melded Treated Rate sold
SAWR Rate Water 441,755 Projected units of water purchased from SDCWA at the SAWR Rate sold Conservation 35,267 Projected Peak M&I units sold (Peak units identified in Section 7 of this report)

Allocation Units All Volume SMCUP
Red
Mountain
Supply
Reliability
Melded
Rate Water
SAWR Rate
Water Conservation
Allocation Unit of Measure Kgal Kgal Kgal Kgal Kgal Kgal Kgal Al l oca ti on Uni ts 2,411,297 827,224 127,035 1,650,354 1,015,283 441,755 35,267 Revenue Requirement $4,305,471 $2,502,753 $502,552 $3,526,438 $4,655,329 $1,695,887 $100,364 Unit Cost ($/Kgal) $1.79 $3.03 $3.96 $2.14 $4.59 $3.84 $2.85 City Council Regular Meeting - Page 246 of 1385
Water Finances & Rates 43
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 8 WATER RATE DERIVATION

8.1 Rate Structure Recommendations
The proposed rates incorporate a few modifications to the District’s water rate structure designed to align rates with the current cost of providing service and reflect policy input provided by the District.

Due to these modifications, impacts to water bills will vary based on customer class and water use when the first‐year proposed rates are implemented on January 1, 2023. Future water rate increases starting January 1, 2024, are applied on an across‐the‐board basis with the same percentage increase to all water rates in future years.

The proposed water structure remains relatively consistent with FPUD’s existing rate structure but incorporates some modifications designed to align rates with current projected costs of service. Rate structure recommendations are described as follows:
 Residential: Maintain a lower volumetric rate for the first 5,000 gallons (5 Kgal) of residential water use in Tier 1, reflecting the lower cost to provide water supply for base indoor demands.

Combine residential Tiers 2 & 3 into a single tier for all water use above the first 5,000 gallons to reflect current costs of service.
 Non‐Residential: Charge the same uniform volumetric rate to Commercial, Government, and Irrigation customer classes, which currently have extremely close but slightly different rates.  Agricultural: Maintain volumetric rates for Agricultural water use based on lower‐cost water supply including reduced SDCWA wholesale water supply rates for customers who qualify for SDCWA’s Permanent Special Agricultural Water Rate Program.  Recover MWD’s Readiness‐to‐Serve Charge via the District’s volumetric water rates, instead of as a small, separate pass‐through charge based on meter size, to align costs with sources of water supply to each customer class,
 Maintain the supplemental Pumping Charges to recover the incremental costs of electricity needed to provide water supply to higher‐elevation service areas but eliminate the small supplemental $0.10 per thousand gallons Pumping Capital Improvement Charge as the District’s pumping facilities provide some benefit to all customers.  Eliminate the reduced Standby Capital Improvement Charges levied on standby customers (accounts with suspended service) and instead have Standby customers pay the same Capital Improvement Charges as all other customers.
 Continue the historical practice of automatic annual adjustments to a) Capital Improvement Charges based on the annual change in the Engineering News‐Record Construction Cost Index City Council Regular Meeting - Page 247 of 1385
Water Finances & Rates 44
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study plus 3%, and to b) SDCWA Infrastructure Access Charges based on actual charges established by SDCWA.

8.2 Agricultural Rate Derivation
The first step in deriving the District’s agricultural rates is to identify the revenue requirement of each functional component for each demand class. The demand class revenue requirement for a functional component is calculated by multiplying the functional component unit cost (section 7.7) by a demand classes’ share of the functional component’s allocation units (section 6.3) i.e., Unit Cost x Allocation Units = Functional Component Revenue Requirement. The total revenue requirement for a demand class is the sum of the revenue requirements for each functional component.

Table W25: Agricultural Demand Class Revenue Requirements

The unit rate for each demand class is calculated by dividing the total revenue requirement by the projected demand for each demand class shown in the table above.

Table W26: Demand Class Unit Costs

The SAWR demand class Unit Rate is the recommended FY 22/23 rate for the Agriculture SAWR (AS) customer class and the third tier of the Agriculture Domestic (AT) customer class.

Demand Class Volumetric
Revenue Requirements All Volume SMCUP
Red
Mountain
Supply
Reliability
Melded
Rate Water
SAWR Rate
Water
Conservati
on
Total Revenue
Requirement
Unit Cost ($/Kgal) $1.79 $3.03 $3.96 $2.14 $4.59 $3.84 $2.85 Demand Class Volumetric Allocation Units (Kgal)
SAWR 441,755        ‐               441,755
Commercial Ag 319,189        319,189
Demand Class Revenue Requirements ($)
SAWR $790,742 $0 $0 $0 $0 $1,696,339 $0 $2,487,081
Commercial Ag Demand $571,348 $0 $0 $0 $1,465,076 $0 $0 $2,036,424 Agricultural and M&I Rate
Derivation
Total
Revenue
Requirement
Projected
Demand
(Kgal)
Unit Rate
($/Kgal)
SAWR $2,487,081 441,755     $5.63
Commerci al Ag Demand $2,036,424 319,189     $6.38
City Council Regular Meeting - Page 248 of 1385
Water Finances & Rates   45
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The Commercial Ag demand class Unit Rate is the recommended FY 22/23 rate for Commercial Ag (CA) customer class as well as the second tier of the Agriculture Domestic (AT) and Commercial Domestic Ag (CB) customer classes.

8.3 M&I Demand Class Rate Derivation
M&I demand is split into use categories in order to fairly allocate costs to M&I non‐residential customer classes and residential tiers as shown in the figure below. The purpose of splitting M&I demand into use categories is to identify how each M&I demand class utilizes available water supplies. The water demand identified in each use category is based on the proportion of actual average use in FY 18/19, FY 19/20 and FY 21/22 applied to the projected FY 22/23 M&I demands shown in Section 6.4. On a per unit basis, the cost to provide base water is less expensive because base facilities are almost fully utilized every month. Conversely, peak demands are more expensive on a per unit basis because peak facilities are only utilized for a few months per year while incurring expenses throughout the year.

Figure W14: M&I Rate Derivation

Functional Component Unit Costs
All Volume SMCUP Red
Mountain
Supply
Reliability
Melded Rate
Water
SAWR Rate
Water Conservation
Use Category Unit Costs
Winter Average Summer Peak
M&I Class and Tiers Unit Costs (Rates)
Non‐Residential Residential Tier 1 Residential Tier 2
City Council Regular Meeting - Page 249 of 1385
Water Finances & Rates 46
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

M&I Use Category Revenue Requirement
The first step in deriving the District’s M&I rates is to identify the revenue requirement in each functional component for each use category (section 6.4). The use category revenue requirement for a functional component is calculated by multiplying the functional component unit cost (Section 7.7) by a use category’s share of the functional component’s allocation units i.e., Unit Cost x Allocation Units = Revenue Requirement. The total revenue requirement for a use category is the sum of the revenue requirements for each functional component.

Table W27: M&I Use Category Revenue Requirements

M&I Demand Class Revenue Requirement
The next step in deriving the District’s M&I rates identifies the revenue requirement in each use category for each demand class. The demand class revenue requirement for a use category is calculated by multiplying the use category unit cost from the table above by the projected demand class allocation units (projected use in each use category) in each use category (section 6.4) i.e., Use Category Unit Cost x Projected Demand Class Allocation Units = Revenue Requirement. The total revenue requirement for a demand class is the sum of the revenue requirements for each use category.

M&I Volumetric
Revenue Requirements All Volume SMCUP
Red
Mountain
Supply
Reliability
Melded
Rate Water
SAWR
Rate
Water
Conserv
ation
Total
Revenue
Requirement
Functional Component Unit
Cost ($/Kgal) $1.79 $3.03 $3.96 $2.14 $4.59 $3.84 $2.85 M&I Use Category Allocation Units (Kgal)
M&I Demand 1,650,354 827,224 127,035 1,650,354 696,094 35,267 Winter 1,066,342 827,224 ‐ 1,066,342 239,117 Average 461,345 ‐ 4,367 461,345 456,977 Summer 87,401 ‐ 87,401 87,401 ‐ Peak 35,267 ‐ 35,267 35,267 ‐ 35,267 Use Category Revenue Requirements ($)
M&I Demand $2,954,133 $2,506,490 $503,058 $3,531,757 $3,195,073 $0 $100,510 $12,791,021 Winter $1,908,751 $2,506,490 $0 $2,281,971 $1,097,547 $0 $0 $7,794,760 Average $825,807 $0 $17,295 $987,278 $2,097,526 $0 $0 $3,927,905 Summer $156,447 $0 $346,107 $187,038 $0 $0 $0 $689,592
Peak $63,127 $0 $139,656 $75,471 $0 $0 $100,510 $378,765 City Council Regular Meeting - Page 250 of 1385
Water Finances & Rates 47
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

Table W28: M&I Demand Class Revenue Requirements

M&I Demand Class Unit Rates
The unit rate for each demand class is calculated by dividing the total revenue requirement by the projected demand for each demand class from the table above.

Table W29:  M&I Demand Class Unit Costs
M&I Demand Class Rate
Derivation
Total Revenue
Requirement
Projected
Demand (Kgal)
Unit Rate
($/Kgal)
Residential $11,301,702    1,457,504   $7.75
Non‐residential   $1,489,320       192,850   $7.72

The non‐residential demand class Unit Rate is the recommended FY 22/23 rate for the Commercial (C), Government (G), and Irrigation Only (I) customer classes. The residential Unit Rate is further broken down into tier rates.

M&I Rate Derivation Winter Average Summer Peak Total
M&I Us e Caetgory Uni t
Rates ($/Kgal) $7.31 $8.51 $7.89 $10.74 $7.75
M&I Demand Class Allocation Units by Use Category (Kgal) Residential 938,928 418,713 69,879 29,984 1,457,504 Non‐residential 127,413 42,631 17,522 5,283 192,850 Total 1,066,342 461,345 87,401 35,267 1,650,354 M&I Demand Class Revenue Requirements ($)
Residential $6,863,391 $3,564,941 $551,343 $322,027 $11,301,702 Non‐residential $931,369 $362,965 $138,248 $56,738 $1,489,320 City Council Regular Meeting - Page 251 of 1385
Water Finances & Rates 48
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

8.4 Residential Tier Rate Derivation
The recommended residential rate structure consists of two tiers.  Tier 1: 0 – 5 Kgal – The Tier 1 breakpoint at 5 Kgal represents indoor use for a household of three people. The performance standard used by the California State Water Resources Control Board (SWRCB) for indoor water us is 55 GPCD1 (gallons per capita per day). According to Census Data2 the average household size in the District is 3.25 people. o 55 GPCD x 3.25 people x 30.5 days = 5,000 gallons
 Tier 2: > 5 Kgal – Usage in Tier 2 represents all outdoor use.

Residential Tier Revenue Requirement
Building off the M&I demand class revenue requirement, the revenue requirement for each use category for each residential tier must be determined. The residential tier revenue requirement for a use category is calculated by multiplying the use category unit cost (from the previous section) by the projected residential tier use in each use category (section 6.4) i.e., Use Category Unit Cost x Projected Residential Tier Demand = Revenue Requirement. The total revenue requirement for a residential tier is the sum of the revenue requirements for each use category.

Table W30: Residential Tier Revenue Requirements

1 55 GPCD is a performance standard for indoor water consumption used by the SWRCB and is also a standard level of usage used by the US Bureau of Reclamation for its health and safety allocation for municipal purposes. 2 From 2016‐2020 American Community Survey 5‐Year Estimates, Average Household Size of Occupied Housing Units By Tenure for 2020 published by The United States Census Bureau for Fallbrook census designated place (CDP) Residential Rate Derivation Winter Average Summer Peak Total M&I Us e Caetgory Uni t
Rates ($/Kgal) $7.31 $8.51 $7.89 $10.74 $7.75
Projected Residential Demand by Tier (Kgal)
Ti er 1 595,626 ‐ ‐ ‐ 595,626 Ti er 2 343,302 418,713 69,879 29,984 861,878 Total 938,928 418,713 69,879 29,984 1,457,504 Residential Revenue Requirement by Tier
Ti er 1 $4,353,914 $0 $0 $0 $4,353,914
Ti er 2 $2,509,477 $3,564,941 $551,343 $322,027 $6,947,788 City Council Regular Meeting - Page 252 of 1385
Water Finances & Rates 49
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Residential Tier Unit Rates
The unit rate for each residential tier is calculated by dividing the total revenue requirement from the prior table by the projected demand for each residential tier from the previous table.

Table W31:  Residential Tier Unit Rates
M&I Residential Tier
Rate Derivation
Total Revenue
Requirement
Projected
Demand (Kgal)
Unit Rate
($/Kgal)
Tier 1 $4,353,914        595,626   $7.31
Tier 2 $6,947,788        861,878   $8.06

Residential Tier 1 is Tier 1 for the Domestic (D), Large Domestic (LD), Multi‐Unit (M), Agriculture Domestic (AT) and Commercial Domestic Ag (CB) customer classes. Residential Tier 2 is Tier 2 for the Domestic (D), Large Domestic (LD), and Multi‐Unit (M) customer classes.

8.5 Pumping Charge Derivation
Customers in the Deluz and Toyon areas of the District require additional pumping to receive water from the District. The District levies a Pumping Charge on customers in those areas to recover the cost of the electricity used to pump water up to the customers. The charge is derived by dividing the cost of electricity to pump water to those areas by the volume of water projected to be sold in those areas. The cost of electricity was provided by the District.

Table W32: Pumping Charge Derivation
Pumping Charge Derivation Amount
Projected Pumping Cost $155,278
Projected Zone Water Sales (Kgal) 216,528
Unit Rate ($/Kgal) $0.72

8.6 Monthly Fixed Service Charge Derivation
Proposed fixed charges are designed to recover the standing capacity and per customer (or per service) costs to service each active, standby, and private fireline service connected to the District’s water system. The following table shows the allocation unit cost for each functional component that comprises each service charge. Fixed functional component allocation unit costs were calculated in section 7.5.

City Council Regular Meeting - Page 253 of 1385
Water Finances & Rates 50
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W33: Service Charge Functional Component Composition

Monthly Fixed Service Charge
This charge applies to active water services. It recovers the Customer functional component revenue requirement on a per service basis, Water Meter Service functional component revenue requirement on a per EMU basis, Water Capacity functional component revenue requirement on a per EMU basis and Standby and Water Capacity functional component revenue requirement on a per EMU basis.

The Customer unit cost is the same per meter size (one meter one charge) and the unit costs per EMU are based on the AWWA meter equivalent ratio for each meter size. Unit costs were calculated in section 7.5.

Table W34: Monthly Fixed Water Service Charge Derivation

Functional Category
Unit of
Measure Unit Cost
Service
Charge
Standby Service
Charge
Private Fire
Service Charge
Customer # $7.01 xx x
Water Meter Service # $6.99 xx
Water Capacity EMU $43.16 x
Standby Capacity EMU $3.44 xx
Private Fire Capacity EFU $0.65 x
Allocation Units Customer
Meter
Service
Water
Capacity
Standby
Capacity
Allocation Unit of Measure # EMU EMU EMU
A llocat ion Uni ts 111,156 152,637 151,321 152,637 Revenue Requirement $779,330 $1,066,944 $6,530,270 $525,185 Unit Cost $7.01 $6.99 $43.16 $3.44
Monthly Fixed
Service Charge
Derivation
Equivalent
Meter
Ratio Customer
Water
Meter
Service
Water
Capacity
Standby
Capacity
Fixed
Service
Charges
Meter Size"
3/4 1.00 $7.01 $6.99 $43.16 $3.44 $60.60
1 1.67 $7.01 $11.67 $72.08 $5.74 $96.51
1 1/2 3.33 $7.01 $23.28 $143.72 $11.46 $185.46
2 5.33 $7.01 $37.26 $230.04 $18.34 $292.64
3 10.67 $7.01 $74.58 $460.52 $36.70 $578.82
4 16.67 $7.01 $116.52 $719.48 $57.34 $900.36
6 33.33 $7.01 $232.98 $1,438.52 $114.66 $1,793.16
City Council Regular Meeting - Page 254 of 1385
Water Finances & Rates 51
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Monthly Fixed Standby Service Charge
This charge applies to inactive water services. It recovers the Customer functional component revenue requirement on a per service basis, Water Meter Service functional component revenue requirement on a per EMU basis, and Standby Capacity functional component revenue requirement on a per EMU basis. This charge does not include the Water Capacity because customers on standby are not receiving water. The Customer unit cost is the same per meter size (one meter one charge) and the unit costs per EMU are based on the AWWA meter equivalent ratio for each meter size. Unit costs were calculated in section 7.5.

Table W35: Monthly Fixed Standby Service Charge Derivation

Monthly Fixed Private Fire Service Charge
This charge applies to active private fire service. This charge applies to active water services. It recovers the Customer functional component revenue requirement on a per service basis and the Private Fire Capacity functional component revenue requirement on a per EFU basis. The Customer unit cost is the same per service size (one service one charge) and the unit costs per EFU are based on the AWWA Equivalent Fire Ratios for each service size. Fire services do not have meters. Unit costs were calculated in section 7.5.

Allocation Units Customer
Meter
Service
Standby
Capacity
Allocation Unit of Measure # # EMU
A llocat ion Units 111,156        152,637       152,637 Revenue Requirement $779,330 $700,453 $525,185
Unit Cost $9.07 $4.59 $3.44
Monthly Fixed
Standby Service
Charge
Derivation
Equivalent
Meter
Ratio Customer
Water
Meter
Service
Standby
Capacity
Monthly
Fixed
Standby
Service
Charges
Meter Size"
3/4 1.00 $7.01 $6.99 $3.44 $17.44
1 1.67 $7.01 $11.67 $5.74 $24.43
1 1/2 3.33 $7.01 $23.28 $11.46 $41.75
2 5.33 $7.01 $37.26 $18.34 $62.61
3 10.67 $7.01 $74.58 $36.70 $118.30
4 16.67 $7.01 $116.52 $57.34 $180.88
6 33.33 $7.01 $232.98 $114.66 $354.65
City Council Regular Meeting - Page 255 of 1385
Water Finances & Rates   52
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W36:  Monthly Fixed Private Fire Service Charge Derivation

8.7 Capital Improvement Charge Derivation
The Water Capital Improvement Charge (CIC) was implemented to provide a partial funding source for capital projects. According to the District’s administrative code, the Water CIC “will be adjusted annually based on the ENR (Engineering News Record) Construction Cost Index (CCI) of February, plus 3% not to exceed 10%.” The District is increasing the CIC charge at a rate higher than inflation in order to fund a greater portion of its capital expenses with the CIC charge over time. The increasing CIC revenue is reflected in the cost of service analysis. The charge is applied by meter size EMUs. The charge for each meter size is based on a ¾” meter equivalent and increases as meter size increases based on the AWWA equivalent meter ratios. This results in charges that recover costs in proportion to the amount of system capacity associated with each meter size.

8.8 SDCWA IAC Fixed Passthrough Charge
SDCWA imposes a fixed monthly Infrastructure Access Charge (IAC) on a per EMU basis to its wholesale customers. This charge is directly passed through to the District’s customers. The current charge per meter EMU is $4.24. The charge derivation is shown in the following table.

Allocation Units Customer
Private Fire
Capacity
Allocation Unit of Measure #E F U
A llocat ion Units 111,156        13,058
Revenue Requirement $779,330 $8,477
Unit Cost $7.01 $0.65
Private Fire
Service Charge
Derivation
Equivalent
Fire Ratio Customer
Private Fire
Capacity
Fixed
Private Fire
Charges
Service Size"
2 1.00 $7.01 $0.65 $7.66
3 2.90 $7.01 $1.89 $8.90
4 6.19 $7.01 $4.02 $11.03
6 17.98 $7.01 $11.69 $18.70
8 38.32 $7.01 $24.91 $31.92
City Council Regular Meeting - Page 256 of 1385
Water Finances & Rates   53
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W37:  Monthly Fixed SDCWA IAC Fixed Passthrough Charge Derivation

Monthly Fixed SDCWA
IAC Passthrough Charge
Derivation
Equivalent
Meter Ratio
Monthly Fixed
SDCWA IAC
Passthrough Charge
Meter Size
3/4 1.00 $4.24
1 1.67 $7.08
1 1/2 3.33 $14.12
2 5.33 $22.60
3 10.67 $45.24
4 16.67 $70.68
6 33.33 $141.32
City Council Regular Meeting - Page 257 of 1385
Water Finances & Rates 54
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

8.9 Proposed Water Rates
The following table shows the proposed water rates. Under Proposition 218, the rates shown below are the maximum rates that the District can implement each year. The District can levy rates that are lower than those shown based upon an annual review of the water utility’s finances if warranted.

Table W38: Proposed Water Rates

Residential: Domestic (D), Large Lot Domestic (LD) & Multi Unit (M) Tier 1 : 0‐5 Kgal $7.17 $7.31 $7.79 $8.30 $8.84 $9.41

City Council Regular Meeting - Page 258 of 1385
Water Finances & Rates 55
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W39: Proposed Fixed Standby and Passthrough Water Rates

SDCWA IAC Charges will be adjusted each January 1 based on the IAC charges adopted by SDCWA in future years,
subject to a maximum adjustment of 10% per year.

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Water Finances & Rates 56
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 9 WATER SHORTAGE EMERGENCY SURCHARGES
The FPUD is proposing to authorize a series of Water Shortage Emergency Surcharges that could be implemented to support financial stability and help ensure adequate funding for water utility operations during periods of water shortages and reduced water sales. As proposed, these rates would be temporary surcharges, billed based on metered water use, that would be levied in addition to FPUD’s regular water rates during water shortage emergencies. The proposed rates correspond with the Water Shortage Response Levels identified in FPUD’s Urban Water Management Plan. No surcharges are proposed for Level 1 and Level 2 water shortages. FPUD is currently in a Drought Level 2, due to drought conditions throughout the western United States that are stressing regional water supplies.

BWA developed a series of Water Shortage Contingency Rate Surcharges corresponding with the Water Shortage Contingency Stages identified in the District’s Urban Water Management Plan. The surcharges are designed to enable the District to recover its costs of service and remain financially stable during periods of water shortages and reduced water sales. These surcharges can be phased in corresponding with escalating water shortages in order to support financial stability under associated escalating water reduction requirements. The surcharges can also be phased out as water use gradually rebounds after a drought has ended.

Financial impacts during water shortages and periods of reduced water sales can include:
• A loss of volumetric water rate revenues due to a reduction in the volume of water sales. • Reduced variable expenses due to reduced volumes of water production and supply, such as reduced costs for water treatment and pumping.
• Additional costs for achieving water demand cutback targets, such as costs for an enhanced conservation program and water demand mitigation efforts. • Additional costs for supplemental sources of water supply when normal‐year supply is curtailed during a drought.
• Potential costs of compliance for drought‐related regulations and potential cost of fines or penalties for non‐compliance with State water reduction mandates during periods of severe drought.

The surcharges account for a) lost revenues due to reduced water sales, less b) estimated reduced variable expenses due to reduced water supply, plus c) an estimate of the additional conservation program, compliance related costs, and/or other efforts to reduce water demand, divided by d) the volume of projected water sales with reduced demand.

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Water Finances & Rates 57
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table W40: Water Shortage Emergency Surcharge Derivation

Level 1L e v e l 2 Level 3 Level 4 Level 5L e v e l 6 Water Shortage
Notice
Water Shortage
Watch
Water Shortage
Alert
Water Shortage
Warning
Critical
Condition
Emergency
Condition
Water Demand Reduction Target Up to 10% Up to 20% Up to 30% Up to 40% Up to 50% > 50% Water Demand Reduction % for Surcharge 10% 20% 30% 40% 50% 60% Normal Year Water Use (Kgal) 2,411,300 2,411,300 2,411,300 2,411,300 2,411,300 2,411,300 Water Reduction Target (Kgal) 241,130 482,260 723,390 964,520 1,205,650 1,446,780 Net Use with Reduction (Kgal) 2,170,170 1,929,040 1,687,910 1,446,780 1,205,650 964,520 Average Volumetric Water Rates by Year
2023 $7.18 $7.18 $7.18 $7.18 $7.18 $7.18
2024 7.61 7.61 7.61 7.61 7.61 7.61
2025 8.07 8.07 8.07 8.07 8.07 8.07
2026 8.55 8.55 8.55 8.55 8.55 8.55
2027 9.06 9.06 9.06 9.06 9.06 9.06
Projected Normal Year Volumetric Revenues
2023 $17,313,000 $17,313,000 $17,313,000 $17,313,000 $17,313,000 $17,313,000 2024 18,438,000 18,438,000 18,438,000 18,438,000 18,438,000 18,438,000 2025 19,636,000 19,636,000 19,636,000 19,636,000 19,636,000 19,636,000 2026 20,912,000 20,912,000 20,912,000 20,912,000 20,912,000 20,912,000 2027 22,271,000 22,271,000 22,271,000 22,271,000 22,271,000 22,271,000 Revenue Loss by Year Due to Lower Use
2023 $1,731,000 $3,463,000 $5,194,000 $6,925,000 $8,656,000 $10,388,000 2024 1,835,000 3,670,000 5,506,000 7,341,000 9,176,000 11,011,000 2025 1,945,000 3,891,000 5,836,000 7,781,000 9,726,000 11,672,000 2026 2,062,000 4,124,000 6,186,000 8,248,000 10,310,000 12,372,000 2027 2,186,000 4,371,000 6,557,000 8,743,000 10,929,000 13,114,000 Reduced Expenses due to Lower Use
Variable Cost per Unit ($/Kgal)1
2023 $3.67 $3.67 $3.67 $3.67 $3.67 $3.67
2024 3.91 3.91 3.91 3.91 3.91 3.91
2025 4.16 4.16 4.16 4.16 4.16 4.16
2026 4.43 4.43 4.43 4.43 4.43 4.43
2027 4.71 4.71 4.71 4.71 4.71 4.71
Reduced Variable Costs
2023 $884,947 $1,769,894 $2,654,841 $3,539,788 $4,424,736 $5,309,683 2024 942,818 1,885,637 2,828,455 3,771,273 4,714,092 5,656,910 2025 1,003,101 2,006,202 3,009,302 4,012,403 5,015,504 6,018,605 2026 1,068,206 2,136,412 3,204,618 4,272,824 5,341,030 6,409,235 2027 1,135,722 2,271,445 3,407,167 4,542,889 5,678,612 6,814,334 Additional Conservation Program
and Compliance Costs2 $0 $0 $50,000 $100,000 $200,000 $300,000 Net Financial Impact
Revenue Los s ‐ Reduced Exps + Add'l Cos ts
2023 $846,053 $1,693,106 $2,589,159 $3,485,212 $4,431,265 $5,378,317 2024 892,182 1,784,363 2,727,545 3,669,727 4,661,909 5,654,090 2025 941,899 1,884,798 2,876,698 3,868,597 4,910,496 5,953,395 2026 993,794 1,987,588 3,031,382 4,075,176 5,168,971 6,262,765 2027 1,050,278 2,099,555 3,199,833 4,300,111 5,450,389 6,599,666 Water Shortage Emergency Rate %
Net Financial Impact / Reduced Volumet r ic Revs
2023 5.4% 12.2% 21.4% 33.6% 51.2% 77.7%
2024 5.4% 12.1% 21.1% 33.1% 50.3% 76.1%
2025 5.3% 12.0% 20.8% 32.6% 49.6% 74.8%
2026 5.3% 11.8% 20.6% 32.2% 48.8% 73.3%
2027 5.2% 11.7% 20.4% 31.8% 48.1% 72.1%
Rounded 5.0% 12.0% 20.0% 32.0% 49.0% 74.0%
Water Shortage Response Levels
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Water Finances & Rates 58
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The proposed water shortage emergency surcharges set forth in the table below represent the maximum rate surcharge that the District may charge in each year.

Table W41: Proposed Maximum Water Shortage Emergency Surcharges

Level 1 Level 2L e v e l 3 Level 4L e v e l 5 Level 6 Water
Shortage
Notice
Water
Shortage
Watch
Water
Shortage
Alert
Water
Shortage
Warning
Critical
Condition
Emergency
Condition
Water Reduction Target Up to 10% Up to 20% Up to 30% Up to 40% Up to 50% > 50% Maximum Surcharge % 5.0% 12.0% 20.0% 32.0% 49.0% 74.0%
Proposed Maximum Surcharges Surcharges billed based on metered water use as measured in units of 1,000 gallons ($/Kgal). (Surcharge % x Residential Tier 2)
Effecti ve on or After
January 1, 2023 $0.40 $0.97 $1.61 $2.58 $3.95 $5.96
January 1, 2024 0.43 1.03 1.72 2.75 4.20 6.35
January 1, 2025 0.46 1.10 1.83 2.92 4.48 6.76
January 1, 2026 0.49 1.17 1.95 3.11 4.77 7.20
January 1, 2027 0.52 1.24 2.07 3.32 5.08 7.67
Proposed Maximum Water Shortage Emergency Surcharges
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Water Finances & Rates 59
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 10 WATER RATE BILL IMPACTS
The following table shows the impacts of the proposed water rates on a range of residential customers with different levels of consumption.

Table W42: Existing and Proposed Bills

City Council Regular Meeting - Page 263 of 1385
Water Finances & Rates 60
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 11 FINANCIAL IMPACT OF DETACHMENT FROM SDCWA

The District is working with Rainbow Municipal Water District to change water suppliers. Detaching from the San Diego County Water Authority and instead buying imported water from Eastern Municipal Water District. Three town hall meetings have been held presenting how the process works. The meetings drew large crowds of more than 100 people at each event. The detachment must first be approved by the Local Agency Formation Commission, or LAFCO. LAFCO is reviewing our applications to detach and will likely make a decision in the next few months. If the applications are approved, the final decision would still need to be ratified by the FPUD and Rainbow voters.

BWA also analyzed the potential savings and impact to water rates if the District detached from San Diego County Water Authority (SDCWA), which obtains most of its water supply from the Metropolitan Water District of Southern California (MWD), and instead purchased MWD water from Eastern Municipal Water District (EMWD) at substantially lower cost. Although all the costs related to the potential detachment from SDCWA are not currently known, initial analysis indicates the potential for annual savings of roughly $3 to $4 million per year (excluding any detachment fees).

Savings would be passed on to FPUD water customers and enable the District to defer or avoid future rate increases that would otherwise be needed.

Based on current financial projections and with no detachment exit fee imposed by LAFCO, FPUD anticipates that it will be able to pass through detachment savings to customers via lower overall rate increases. The chart below shows the proposed maximum rate revenue increases without detachment and potential and estimated reduction after detachment from SDCWA, based on currently available information.

Figure W15: Impact of Detachment in FY 23/34 on Rate Revenue Increases

0%
2%
4%
6%
8%
FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27
Remain Detach
Potential Lower Rate Increases with SDCWA Detachment
(Less that 1% for three years)
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Wastewater Finances & Rates 61
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 12 WASTEWATER ENTERPRISE FINANCES & RATES

12.1 Wastewater System Overview
FPUD’s wastewater system serves a little over 5,000 accounts and includes over 78 miles of wastewater collection system pipelines, approximately 4 miles of wastewater force mains, 6 lift stations and a Water Reclamation Plant (WRP) with a 2.7 million gallon per day (mgd) capacity that currently processes approximately 1.5 mgd of influent flows. Treated effluent is disposed via 18 miles of pipeline to an outfall in the Pacific Ocean. In 2015, the District completed a $28 million rehabilitation of the WRP, and a $2 million recycled water pipeline extension that substantially increased the District’s recycled water system capacity.

12.2 Wastewater Financial Overview
Fallbrook Public Utility District’s wastewater enterprise is a financially self‐supporting enterprise that relies primarily on revenues from wastewater rate revenues to fund the costs of providing service.

Wastewater rate revenues are projected to account for over 86% of total annual revenues, with the remaining revenues coming from interest earnings, property tax, and capacity charges from new development, and other miscellaneous revenues. As such, wastewater rates must be set at levels adequate to fund the costs of operating and maintaining the wastewater system and fund necessary capital improvements to keep the wastewater system in good operating condition.

The District has provided good financial stewardship of the wastewater utility by gradually raising rates each year in an effort to keep revenues in line with the cost of providing wastewater service.

However, over the past five years the wastewater utility fund generated less revenue than projected, resulting in a drawdown of fund reserve to levels that are currently significantly below fund reserve targets. Going forward the District is aiming to improve revenue stability and gradually build fund reserves toward achieving target levels.

12.3 Current & Historical Wastewater Rates
the following table shows a history of the District’s wastewater rates. The District has gradually increased rates each year in an effort to keep revenues in line with the cost of providing service.

Current and historical wastewater rates are shown on Table S1 below.

City Council Regular Meeting - Page 265 of 1385
Wastewater Finances & Rates 62
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table S1: Historical Wastewater Rates

Adopted WW Rates FY 15‐16 FY 16‐17 FY 17‐18 FY 18‐19 FY 19‐20 FY 20‐21 FY 21‐22 Monthly Fixed Service Charges Current
Prior Charges (discont inue d and replaced wi th charge per EDU after 1/1/2018) 3/4 $16.12 $16.12 ‐ ‐ ‐ ‐ ‐ 1 24.01 24.01 ‐ ‐ ‐ ‐ ‐ 1 1/2 43.75 43.75 ‐ ‐ ‐ ‐ ‐ 2 67.42 67.42 ‐ ‐ ‐ ‐ ‐ 3 122.67 122.67 ‐ ‐ ‐ ‐ ‐ 4 201.60 201.60 ‐ ‐ ‐ ‐ ‐ 6 398.91 398.91 ‐ ‐ ‐ ‐ ‐ SS 16.12 16.12 ‐ ‐ ‐ ‐ ‐ Adopted Charges $ / EDU ‐ ‐ $9.28 $9.70 $10.14 $10.60 $11.08 Capital Improvement Charges $10.84 $10.84 $11.16 $11.53 $11.62 $11.63 $11.68 Flow‐Based Rates ($/Kgal)
Ag Domestic (AT) $8.77 $8.77 $9.44 $9.86 $10.32 $10.79 $11.28 Commerci al Ag (CB) 8.77 8.77 9.44 9.86 10.32 10.79 11.28 Single Fam ily (D) 8.77 8.77 9.44 9.86 10.32 10.79 11.28 Single Fam ily (Large) (LD) 8.77 8.77 9.44 9.86 10.32 10.79 11.28 Multi Fam ily (M) 8.77 8.77 9.44 9.86 10.32 10.79 11.28 Government (G) 8.77 8.77 9.37 9.79 10.25 10.72 11.20
School 8.77 8.77 9.37 9.79 10.25 10.72 11.20
Church 8.77 8.77 9.37 9.79 10.25 10.72 11.20
Commerci al ‐ Low Strength (C_L) $8.77 $8.77 $9.37 $9.79 $10.25 $10.72 $11.20 Commerci al ‐ Medium Strength (C_M) 13.27 13.27 11.57 12.09 12.65 13.22 13.81 Commerci al ‐ High Strength (C_H) 22.28 22.28 14.44 15.09 15.77 16.48 17.22 City Council Regular Meeting - Page 266 of 1385
Wastewater Finances & Rates 63
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 13 WASTEWATER FINANCIAL PLAN
BWA developed long‐term cash flow projections to identify the wastewater utility’s annual revenue requirements and evaluate the overall level of rate increases needed to meet future funding needs.

The financial projections incorporate the latest information available as well as a number of reasonable assumptions developed with input from the District.

13.1 Financial Plan Assumptions
The following table details the escalation factors used to develop the long‐term cash flow projections.

Table S2: Wastewater Enterprise Escalation Factors

REVENUE ASSUMPTIONS
 Rate adjustments are assumed to become effective on January 1 of each year.  Wastewater sales revenues are based on wastewater sales projections and projected wastewater rates.
 The District projects growth based previous low growth years to ensure rate revenue is sufficient to support District operations.
 Interest earnings are projected based on the annual beginning fund balance multiplied by projected interest rate. The interest rate projections are based on recent and anticipated interest rates increases.
 The District projects property tax revenue increases based on previous low increase years to ensure rate revenue is sufficient to support District operations.  Rent revenue increases are conservatively based on the District’s rental agreements.

Escalation Factors FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Salaries 7.0% 8.0% 6.5% 5.0% 5.0%
Benefits 6.5% 7.0% 5.5% 5.0% 5.0%
CPI 5.0% 5.0% 4.5% 4.0% 4.0%
ENR 5.5% 6.7% 4.5% 4.0% 4.0%
ENR + 3% 8.5% 9.7% 7.5% 7.0% 7.0%
Property Tax 1.0% 1.0% 1.0% 1.0% 1.0%
Rent ‐ 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Interest 0.6% 1.0% 1.5% 1.5% 1.5%
Growth 0.15% 0.15% 0.15% 0.15%
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Wastewater Finances & Rates 64
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study EXPENSE ASSUMPTIONS
 Operating and maintenance expenses (other than wholesale water costs) are based on the District’s 2022/23 Budget and escalation factors listed above.  The District projects the cost of Salaries to increase based on a recent compensation study it completed and projected future cost of living adjustments.  The District projects the cost of Benefits to increase based on projected salary costs and projected inflation of specific benefit expenses such as health insurance.  CPI cost escalation is based on the recent and historical Consumer Price Index changes. This report projects that the current, extraordinarily high inflation level will gradually drop back towards a normal rate of inflation. Recent cost inflation has been unpredictable, but the CPI escalation projections are informed by recent projections from the Federal Reserve.  ENR cost escalation is based on the recent and historical Engineering News Record Construction Cost Index changes. This report projects that the current, extraordinarily high inflation level will gradually drop back towards a normal rate of inflation. Recent cost inflation has been unpredictable, but the ENR escalation projections are informed by recent projections from the Federal Reserve.
 Debt service projections are based on outstanding debt schedules. The District does not anticipate issuing any additional debt in future years.

13.2 Financial Plan Drivers
The District’s wastewater enterprise is facing a number of manageable financial challenges that will drive the need for rate increases in upcoming years. Key drivers of future rate increases are summarized as below.

Capital Improvement Needs & Rehabilitation of Aging Infrastructure The District takes a proactive approach to maintaining its wastewater system which requires a steady stream of repair and improvement projects. Accounting for construction cost inflation, the District anticipates funding approximately $4.5 million of capital improvement projects over the next 5 years, averaging about $0.9 million per year, based on the District’s current Capital Improvement Plan. With the proposed rate increases, the District will be able to fund this level of capital spending without incurring additional debt.

Variable Average Winter Water Consumption
City Council Regular Meeting - Page 268 of 1385
Wastewater Finances & Rates 65
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Residential variable rate revenue has been volatile due to annual changes in winter water use largely based on weather and outdoor irrigation. Based on current wastewater rates, residential rate revenues over the past three years would have varied by up to $700,000 per year.

Low Fund reserves
The wastewater enterprise generated less revenue than projected over the past 5 fiscal years, resulting in deficits and a gradual drawdown of wastewater fund reserves. The beginning balance for FY 22/23 is estimated at $1.8 million, approximately $3 million below the target fund reserve for the enterprise.

Ongoing Cost Inflation
The District’s wastewater enterprise faces ongoing operating cost inflation due to annual increases in a range of expenses including staffing, utilities, insurance, supplies, etc. On top of rate increases needed for other purposes, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. In recent months, inflation has reached forty‐year highs with CPI and the ENR Construction Cost Index reaching roughly 9% in early 2022. However, inflation is not expected to remain at such elevated levels in future years.

City Council Regular Meeting - Page 269 of 1385
Wastewater Finances & Rates 66
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

13.3 Cash Flow Projection with No Rate Increases
Based on financial projections without any rate increases, the District will operate at a deficit and deplete the wastewater enterprise fund reserves within six years. The following figure shows a 5‐year projection of annual revenues with no rate increases; expenses based on the District’s FY 22/23 budget, adjusted for cost escalation and broken down by key categories; and ending fund reserves compared to the reserve target.

Figure S1: WW 5‐Year Cash Flow Projection Without Rate Increases

13.4 Cash Flow Projections and Recommended Rate Increases A summary of the cash flow projections is shown in the following table. The overall rate revenue increases shown on the table are designed to fund the District’s cost of providing service each year, maintain roughly balanced budgets, maintain healthy debt service coverage levels, and meet long‐ term fund reserve targets. With the proposed phase‐in of rate increases, the wastewater enterprise is projected to gradually accrue fund reserves toward meeting its fund reserve target but is not projected to meet the target until FY 2027/28.

In addition to overall rate increases, some modifications to the wastewater rate structure are also proposed. Actual impacts to customers’ wastewater bills will vary based on customer class and wastewater use due to these proposed rate structure modifications and the updated cost‐of‐service analysis.

City Council Regular Meeting - Page 270 of 1385
Wastewater Finances & Rates 67
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table S3: Proposed Wastewater Rate Adjustments

*WW Enterprise Indentured for Full WWTP Loan

The following figure shows a 5‐year projection of expenses based on the District’s FY 22/23 budget, adjusted for cost escalation, and broken down by key categories; projected annual revenues with proposed rate increases; and ending reserves compared to the reserve target.

Figure S2: WW 5‐Year Cashflow Projection With Recommended Rate Increases

WW Financial Dashboard FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Month Rate Increase Effective Jan Jan Jan Jan Jan
WW Rev Adjustments 5.00% 5.00% 5.00% 5.00% 5.00%
Projected Maximum Rate Revenue Increases
Key Financial Information
Revenue from Full Year Rate Increase $321,645 $338,234 $355,678 $374,022 $393,312 Total Revenue $9,065,292 $9,485,983 $9,899,673 $10,326,791 $10,774,747 Total Expenses $8,679,330 $8,834,686 $9,114,981 $9,919,798 $10,389,499 Net Cash Change (Exl. Debt Proceeds) $385,962 $651,297 $784,692 $406,993 $385,248 Total Reserves $2,211,645 $2,862,942 $3,647,634 $4,054,627 $4,439,874 Reserves Over/Under Target ($2,825,829) ($2,355,289) ($1,735,278) ($1,477,854) ($1,248,871) WW Debt Service Coverage (1.3x Target)* 1.56x 1.58x 1.62x 1.68x 1.74x $0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27
Millions
WW 5‐Year Cashflow Projection
PAYGO
Capital
Debt Service
O&M
Expenses
Proposed
Revenue
Target
Reserves
Projected
Reserves
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Wastewater Finances & Rates 68
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Detailed wastewater enterprise financial projections are shown in the following table.

Table S4: Detailed Wastewater Financial Projections

REVENUES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
Revenues from Rates
$321,645 $338,234 $355,678 $374,022 $393,312
$6,754,543 $7,102,909 $7,469,241 $7,854,467 $8,259,561
Revenues from Current Rates $6,432,898 $6,442,548 $6,452,211 $6,461,890 $6,471,583 Proposed Rev Adjustments $160,822 $491,244 $839,191 $1,205,566 $1,591,323 Subtotal Revenues from Rates $6,593,721 $6,933,792 $7,291,402 $7,667,456 $8,062,905 Other Operating Revenues
Sundry $1,000 $1,000 $1,000 $1,000 $1,000
Subtotal Other Operating Revenue $1,000 $1,000 $1,000 $1,000 $1,000 Non‐Operating Revenues
Wastewater CIC $1,248,757 $1,332,602 $1,392,569 $1,448,272 $1,506,203 WW Capacity fees $40,371 $40,431 $40,492 $40,553 $40,613 1% property tax ‐ IDS $1,085,974 $1,096,833 $1,107,802 $1,118,880 $1,130,068 Federal Interest Rate Subsidy $84,516 $70,261 $55,178 $39,233 $22,388 Interest $10,954 $11,064 $11,230 $11,398 $11,569
Subtotal Non‐Operating Revenues $2,470,572 $2,551,191 $2,607,271 $2,658,335 $2,710,842 TOTAL REVENUES $9,065,292 $9,485,983 $9,899,673 $10,326,791 $10,774,747 EXPENSES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
Operating Expenses
Collection $853,042 $910,089 $962,050 $1,007,399 $1,054,906 Treatment $1,753,579 $1,866,563 $1,969,605 $2,059,828 $2,154,232 Administration $3,468,326 $3,659,812 $3,834,170 $3,997,735 $4,168,353 Subtotal Operating Expenses $6,074,947 $6,436,463 $6,765,824 $7,064,962 $7,377,491 Non‐Operating Expenses
WW Existing Debt $1,733,383 $1,733,212 $1,734,864 $1,731,618 $1,731,769 PAYGO Funded Capital $871,000 $665,011 $614,293 $1,123,218 $1,280,239 Subtotal Non‐Operating Expense
s $2,604,383 $2,398,223 $2,349,157 $2,854,836 $3,012,008 TOTAL EXPENSES $8,679,330 $8,834,686 $9,114,981 $9,919,798 $10,389,499 NET REVENUES $2,990,345 $3,049,520 $3,133,849 $3,261,829 $3,397,256 NET CASH CHANGE $385,962 $651,297 $784,692 $406,993 $385,248 BEGINNING BALANCES $1,825,683 $2,211,645 $2,862,942 $3,647,634 $4,054,627 ENDING BALANCES $2,211,645 $2,862,942 $3,647,634 $4,054,627 $4,439,874 City Council Regular Meeting - Page 272 of 1385
Wastewater Finances & Rates 69
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

13.5 Wastewater Debt Service Coverage
The District’s wastewater enterprise has two outstanding debt obligations:
 The 2010 QECB loan funded the District’s 1 MW solar facility.

 The 2021 Wastewater Refunding Revenue Bonds (2021 Bonds), which refunded a SRF Loan that funded the rehabilitation and modernization of the District’s Water Reclamation Plant

Pursuant to the legal covenants securing the 2021 Bonds, the debt is secured solely by the net revenues of the wastewater enterprise. However, 30% of the 2021 Bonds debt service is paid by the recycled water enterprise. For the purposes of calculating debt service coverage, debt service paid by the recycled enterprise can be counted as a supplemental revenue source. The following table calculated debt service coverage accounting for both the full

Table S5: WW Debt Service Coverage Calculation

WW Debt Service Coverage FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
WW Debt Service Coverage Net Revenue
WW Revenue $9,065,292 $9,485,983 $9,899,673 $10,326,791 $10,774,747 RW Debt Contribution $519,307 $519,224 $520,072 $518,980 $519,510 Total WW Debt Service Revenue $9,584,599 $10,005,207 $10,419,745 $10,845,771 $11,294,257 WW Operating Expenses $6,074,947 $6,436,463 $6,765,824 $7,064,962 $7,377,491 WW Debt Service Net Revenue $3,509,652 $3,568,744 $3,653,921 $3,780,809 $3,916,766 WW Debt Service
Solar QECB $521,667 $521,690 $521,362 $520,665 $519,579 Total WWTP SRF $1,731,022 $1,730,746 $1,733,575 $1,729,934 $1,731,700 Total WW Debt Service $2,252,689 $2,252,435 $2,254,937 $2,250,599 $2,251,279 WW Debt Service Coverage 1.56x 1.58x 1.62x 1.68x 1.74x
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 14 WASTEWATER COST OF SERVICE ANALYSIS AND RATE DERIVATION BWA derived updated wastewater rates that account for both a) the overall rate increases identified in the financial projections, and b) proposed rate structure modifications. The proposed rates are designed to equitably apportion and recover costs from the District’s customer base. The basic methodology used to develop new rates includes the following steps:

Figure S3: WW Cost of Service Analysis and Rate Derivation Process

Derive Unit Rates for Wastewater Capacity,
Flow & Strength
Divide costs allocated for recovery from fixed capacity, flow and strength by total loadings for each functional component to derive unit rates for wastewater EDU,
flow, BOD, and TSS. The unit rate per EDU is paid by all customers as a monthly fixed service charge.

Residential Rate Derivation
Allocate the revenue requirement for cost
recovery based on EDU and average winter
water use adjusted for the residential
return‐to‐sewer factor. Divide costs
allocated each category by their respective
billing units.

Non‐Residential Rate Derivation
Divide the revenue requirements for each
customer class by the projected water use
adjusted for the non‐residential return‐to‐
sewer factor to determine a rate per kgal
for each class.

Allocate Flow & Strength Costs to Customer
Classes
Multiply unit rates by the wastewater flow and loadings of each customer class to determine the revenue
requirement of each class.

Estimate Wastewater Flow & Strength Loadings
The wastewater flow, BOD, and TSS concentrations for
each class were multiplied by the billing units and
balanced to fall within the range of recent WRF inflows Allocate Cost to Functional Component
Each cost was allocated to function:
fixed capacity (EDU), flow, BOD, and TSS.

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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

14.1 Wastewater Rate Structure Recommendations
Bartle Wells Associates conducted an independent review the District’s wastewater rate structure.

Based on evaluation of rate alternatives and input from the District’s project team, Finance Committee, Board of Directors, and independent legal counsel, BWA recommends a few modifications to improve revenue stability and realign rates with the current cost of providing service in conformance with the substantive requirements of Proposition 218. Rate structure modifications are summarized below.

Transition Residential Rates from 30% to 70% Fixed Cost Recovery Volumetric residential wastewater rates are billed based on a two‐year average of winter water use (AWC) from December through February adjusted to account for a 75% return‐to‐sewer factor.

Although this period generally coincides with the lowest‐use months, actual winter use has varied substantially from year‐to‐year largely based on weather and outdoor irrigation. BWA came to this conclusion because the District’s wastewater treatment plant flows have remained relatively consistent despite significant changes in winter water use.

The following table shows a history of billed residential wastewater usage in comparison to assumptions used in the 2017 Rate Study. At current rates, the range in AWC result in $700,000 in annual revenue variability.

Figure S4: Residential Billed Winter Use Variability

At the same time, the District’s current residential wastewater rates are skewed heavily toward volumetric rate recovery, with fixed charges currently accounting for only 32% of residential service charge revenues. This level of fixed residential rate recovery is substantially lower than industry norms and substantially lower than the wastewater enterprise’s percentage of fixed expenses.

Together, the District’s low level of fixed residential rate recovery coupled with substantial variations 900
1,000
1,100
1,200
1,300
2017 Rate
Study
Assumption
FY 17‐18 FY 18‐19 FY 20‐21
WW Billed Residential Winter Water Use
Units (AF)
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study in winter water use have resulted in large variations in residential wastewater rate revenues from year to year.

Based on review of residential wastewater rate options and input received from the District, BWA recommends the District gradually transition its residential wastewater rates from 30% to 70% fixed rate recovery over the next five years to help improve revenue stability while still affording residential customers significant control over their bills.

Transition Residential Return‐to Sewer (RTS) Factor from 75% to 80% To account for water use that does not get discharged into the wastewater system, such as due to outdoor landscape irrigation, the District adjusts the volume of billed wastewater usage based on a discounted RTS factor. Over the past 5 years, the District has been adjusting billable residential usage by a 75% RTS factor. Based on analysis of residential winter water use and influent flows at the WRF over the past four years, BWA recommends transitioning the residential RTS factor from 75% to 80% of winter water use. This will bring the residential wastewater billing units into alignment with wastewater treatment plant inflows. No changes are recommended to the commercial RTS factor which is proposed to remain at 90% of all metered water consumption.

14.2 Wastewater Billing Units
This section shows the projected billing units used in the cost of service analysis and rate derivation.

Projected billable volumetric wastewater use is based on the average of the two lowest‐use years of the last four years in order to reflect slightly conservative estimates of future billable usage.  Residential billable wastewater use is projected based on average monthly residential winter water consumption (AWC) from December through February in fiscal years 2019/20 and 2020/21, multiplied by an 80% RTS factor, and multiplied by twelve months.  Commercial and Government volumetric billed wastewater use is projected based on average annual consumption from in fiscal years 2019/20 and 2020/21 multiplied by a 90% RTS factor.  EDU assignments to each customer class are based on FPUD Administrative Code, Section

11.7, Schedule of equivalent dwelling units and class of service. The District assigns each customer a number of EDUs to reflect that customer’s proportionate share of wastewater system capacity. One EDU represents the equivalent wastewater flow and strength of a typical single family home.

The following tables show historical and projected billable wastewater usage and the number of EDUs assigned to each customer class.

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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table S6: Recent and Projected Annual Billing Units

Customer Billing Units FY 18‐19 FY 19‐20 FY 20‐21 FY 20‐22 Projected
FY 22‐233

7.8.22 EDU5
Counts
Domestic
Return to Sewer Factor 4 75% 75% 75% 75% 80%
Ag Domestic (AT) 81 198 99 0 158 1.00
Commercial Ag (CB) 342 162 189 459 187 6.60
Single Family (D) 265,986 258,120 222,795 254,448 256,488 4,386.86 Single Family (Large) (LD) 10,746 9,621 8,253 9,612 9,533 136.68 Multi Family (M) 134,719 131,689 127,438 134,949 138,201 2,629 Total Domestic 411,874 399,790 358,774 399,468 404,568 7,160 School
Elementary 48.08
Junior High 18.13
Total School 66
Commercial and Government
Return to Sewer Factor 90% 90% 90% 90% 90%
Government (G) 7,232 5,614 6,178 5,614 5,896 151.01 Commercial ‐ Low Strength (C_L) 41,993 42,153 48,153 42,153 45,153 1,114.13 Commercial ‐ Medium Strength (C_M) 15,004 14,005 14,526 14,005 14,265 Commercial ‐ High Strength (C_H) 11,750 10,631 11,315 10,631 10,973 Total Commercial and Government 75,978 72,402 80,171 72,402 76,286 1,265 Total 487,852 472,192 438,945 471,870 480,854 8,491
Billed Water Use Kgal1,2
5 "EDU" stands for equivalent dwelling unit. EDU definitions are found in the FPUD Admi ni s tra ti ve Code 1 Bille d use is based on metered water use. 1 Kgal = 1,000 gallons. Domestic billed use is based on a two‐year average of average wi nter water consumption (AWC) m ult iplie d by the return‐to‐se w e r factor. AWC is based on the average water use in Dec, Jan and Feb.
2 Commercial and Government bille d use is based on actual water consumption in each month m ult iplie d by the return‐to‐ sewer factor.
3 Projected billed water use is based on FY 19‐20 and FY 20‐21, the low e st two of the past four years. The low e st two years were used to project future flows conservatively and are like ly a better repres entati on of actual se we r flow. 4 The return‐to‐se w e r factor (RTS) is used to adjust actual flows to better reflect actual se w e r flow by removing water used for outdoor irrigat ion. Based on analysis of billed use and plant flows, BWA is recommending Domestic RTS be adjusted from 75% to 80%.

Included in
(C_L)
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Wastewater Finances & Rates 74
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The following tables shows the calculation of school EDU’s and projected flow.

Table S7: Wastewater School Billing Units

14.3 Flows and Loadings
The following table estimates the flows and loadings of each customer class based on analysis of recent winter and annual water consumption data and wastewater strength assignments for each customer class.
 Residential flows per unit are based on analysis of historical winter water use data. Residential wastewater strength concentrations are based on estimates previously published by the State Water Resources Control Board (SWRCB), input from District WRF staff, and analysis of wastewater strength concentrations measured at the WRF. Residential wastewater strength concentrations have increased over the past decade as the volume of wastewater flow has decreased due to transition to low‐flow toilets, water‐efficient appliances, and other water conservation and efficiency measures.
 Commercial wastewater flows are estimated based on annual metered water use adjusted to account for a 90% RTS factor. Wastewater strength assignments for commercial customer classes are largely based on strength estimates previously published by the SWRCB, input from District WRF staff, and analysis of wastewater strength concentrations measured at the WRF.

School Units Students Staff Total
Elementary
People 2,885 404
Flow per Person (GPD) 10 15
School Days 180 180
Annual Flow (Kgal) 5,193.0 1,090.8 6,284
Students per EDU 60
EDUs 48.08 48.08
Junior High
People 725 90
Flow per Person (GPD) 15 15
School Days 180 180
Annual Flow (Kgal) 1,957.5 243.0 2,201
Students per EDU 40
EDUs 18.13 18.13
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  Wastewater flow from schools is estimated based on number of students and staff and estimated flow per person based on prior estimates published by SWRCB. This ensures that billable usage excludes water use for outdoor irrigation. School wastewater strength assignments are largely based on strength estimates previously published by SWRCB, input from District WRF staff, and analysis of wastewater strength concentrations measured at the WRF.

The resulting flow and strength projections for each class are shown on the following table and provide the basis for allocating costs and deriving equitable wastewater rates for each customer class.

Table S8: Wastewater Flows and Loading

Kgal3 MG5 GPD6 BOD7 TSS8

BOD TSS
Domestic
Ag Domestic (AT) 158 0.16 434 290 320 383 423
Commercial Ag (CB) 187 0.19 513 290 320 453 500
Single Family (D) 256,488 256.49 702,707 290 320 620,850 685,076 Single Family (Large) (LD) 9,533 9.53 26,117 290 320 23,075 25,462 Multi Family (M) 138,201 138.20 378,634 290 320 334,527 369,134 Total Domestic 404,568 405 1,108,405 979,289 1,080,594
Non‐Domestic
Government (G) 5,896 5.90 16,152 290 320 14,271 15,747
Elementary 6,284 6.28 17,216 170 130 8,916 6,818
Junior High 2,201 2.20 6,029 170 130 3,122 2,388
Commercial ‐ Low Strength (C_L) 45,153 45.15 123,706 290 320 109,296 120,602 Commercial ‐ Medium Strength (C_M) 14,265 14.27 39,082 500 560 59,534 66,678 Commercial ‐ High Strength (C_H) 10,973 10.97 30,063 800 890 73,272 81,516 Total Non‐Domestic 84,771 85 232,248 268,412 293,749
Total Customer Flows and Loadings 489,338 489 305.5 336.5 1,247,700 1,374,343 Inflow and Infiltration 29,200 29 100 100 24,373 24,373 Projected Plant Flows and Loadings 518,538 519 293.9 323.2 1,272,073 1,398,716 Historic Plant Flows and Loadings (Low)1 516,821 517 262. 4 315.7 1,132,007 1,361,827 Historic Plant Flows and Loadings (High)1
556,000 556 314.0 343.6 1,457,146 1,594,649
1 Historic Plant Flows and Loadi ngs based data for FY 18‐19, FY 19‐20 and FY 20‐21 provided by the district 3 "Kgal " stands for 1,000 gallons
4 Flow factor based on es ti mated flow returning to se we r 5 "MG" stands for 1,000,000 gallons
6 "GPD" st ands for gallons per day
7 "BOD" stands for biochemical oxygen demand
8 "TSS" stands for total suspe nde d solids
9 Based on State Water Resource Control Board (SWRCB) G uide line s for Was tewater Agenci es Loadings (lbs)
2 Flow es ti mate based on water demand, average winter use is the basis for domestic billing Wastewater Flows and Loadings
Projected Wastewater Flow2 Strength (mg/l)9
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

14.4 Revenue and Expense Allocation Categories
Expenses and offsetting revenues were grouped into allocation categories for Admin, Treatment, Collection/Flow and As All Other by analyzing the District’s budget on a line‐by‐line basis and assigning each expenditure and revenue to the appropriate category. The Expenses and revenues in the allocation categories are based on the average budgeted amounts over the next five years. The reason for this is there are no planned changes to district operations, but capital spending is projected to fluctuate based on project timing. Expenses and revenues were grouped into the following allocation categories:
 Administration includes the wastewater enterprise’s portion of the District’s administrative costs.

Administration expenses were allocated to the EDU and Flow functional components to reflect standing and volumetric system capacity.
 Treatment includes costs related to wastewater treatment. These costs were allocated to evenly to the flow, BOD and TSS functional components based on input from District staff.  Collection/Flow includes costs related to wastewater collection and conveyance and are allocated to the flow functional component.
 As All Other includes other expenses and offsetting revenues that are not related to one of the specific categories listed above. These revenues and expenses are allocated proportionally based on the combined allocation of all the other categories.

14.5 Functional Allocation
The next step in the cost of service analysis is to assign wastewater system costs in each allocation category for revenue recovery via the functional cost components of EDU, flow, BOD (biochemical oxygen demand), and TSS (total suspended solids). While there is no single correct approach for cost allocation, BWA believes that costs should be allocated within a reasonable range that reflects both a) underlying cost causation, to the extent such causation can reasonably be determined or estimated, and b) the policy preferences of the agency in cases where a range of reasonable approaches can be justified. This process is intended to proportionately allocate costs to each functional component to determine the revenue requirement for each component. The allocations to each functional component were based on input from District staff.

The functional cost components are described as follows:
 EDU reflects costs associated with fixed capacity in the wastewater system.  Flow reflects costs associated with the volume of wastewater collected and treated.  BOD reflects costs associated with treating BOD.
 TSS reflects costs associated with treating TSS.

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Wastewater Finances & Rates 77
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study The following table shows a breakdown of the sewer utility’s expenses and how they are allocated.

Table S9: Functional Cost Allocation

14.6 Wastewater Unit Cost Derivation
The following tables calculates the unit rates per EDU, and rates per unit of flow, BOD and TSS. The wastewater rate revenue requirements from the prior table for each functional component are divided by the units related to each function as shown in sections 14.2 and 14.3.

Table S10: Unit Rate Calculations

Functional Allocation
Categories Expenses
Offsetting
Revenues
Allocation
Amount EDU Flow BOD TSS
Administration $2,808,632 ‐$11,243 $2,797,389 45% 55.0% Treatment $3,576,314 ‐$656,040 $2,920,274 33.3% 33.3% 33.3% Collection/Flow $1,985,665 ‐$824,448 $1,161,218 100.0%
Total $8,370,611 $6,878,881 $1,258,825 $3,673,206 $973,425 $973,425 Allocation % 18.30% 53.40% 14.15% 14.15%
As All Other $2,125,959 ‐$1,108,911 $1,017,048 18.30% 53.40% 14.15% 14.15% Total $10,496,570 $7,895,928 $1,444,943 $4,216,292 $1,117,346 $1,117,346 Final Allocation 100.00% 18.30% 53.40% 14.15% 14.15%
Revenue Requirement $6,754,543 $1,236,071 $3,606,812 $955,830 $955,830 Projected 5‐Year
Average
Functional Allocation
Units EDU Flow BOD TSS
(#) (KGAL) (LBS) (LBS)
Demand Units 101,897 489,338 1,247,700 1,374,343
Revenue Requirement $1,236,071 $3,606,812 $955,830 $955,830 Uni t Cost ($/Unit) $12.14 $7.37 $0.77 $0.70
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14.7 Flow and Strength Revenue Requirement by Class
Revenue requirements for each customer class are calculated by multiplying the unit rates for flow, BOD and TSS from Section 14.6 by the volume of wastewater flow and loadings associated with each class from Section 14.3.

Table S11: Flow and Strength Revenue Requirement by Class

Flow and Strength Revenue
Requirements by Class Flow BOD TSS
Revenue
Requirement
(KGAL) (LBS) (LBS) ($)
Domestic
Ag Domestic (AT) 158 383 423 $1,756
Commercial Ag (CB) 187 453 500 $2,075
Single Family (D) 256,488 620,850 685,076 $2,842,594
Single Family (Large) (LD) 9,533 23,075 25,462 $105,650 Multi Family (M) 138,201 334,527 369,134 $1,531,651
Total Domestic 404,568 979,289 1,080,594 $4,483,724
School
Elementary
6,284 8,916 6,818 $57,889
Junior High 2,201 3,122 2,388 $20,272
Total School 8,484 12,039 9,206 $78,161
Commercial and Government
Government (G) 5,896 14,271 15,747 $65,339
Commercial ‐ Low Strength (C_L) 45,153 109,296 120,602 $500,416 Commercial ‐ Medium Strength (C_M) 14,265 59,534 66,678 $197,126 Commercial ‐ High Strength (C_H) 10,973 73,272 81,516 $193,705 Total Commercial and Government 76,286 256,373 284,543 $956,586 Total 489,338 1,247,700 1,374,343 $5,518,472
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

14.8 Domestic Flow and Strength Rate Derivation
Residential rates are derived by dividing the total amount of costs designated for fixed and variable residential rate recovery by the total number of residential fixed and variable billing units. The fixed and variable amounts were set to produce 70% fixed recovery from residential customers accounting for separate fixed CIC charges.

Volumetric billing units consist of the two‐year average of winter water consumption (AWC) from December through February with an 80% RTS factor applied to reflect that an estimated 20% of residential winter use does not enter the wastewater collection system.

The following table calculates the fixed monthly rate per EDU and the volumetric rate per unit of billed average winter water use for residential customers based on the billing units and revenue requirements in Section 14.7. The monthly fixed EDU rate was calculated in section 14.6

Table S12: Domestic Rate Derivation

FY 22/23 Domestic Rate Derivation Units Fixed Volumetric Volumetric Revenue Requir ement Al l oca ti on 56% 44% Revenue Requi rement $4,483,724 $2,495,222 $1,988,502
Volumetric Flow Rate ($/AWC Kga l /Month) 404,568 $4.92 Fixed Flow Rate ($/EDU/Month) 7,160 $29.05
Domestic Monthly Fixed Charge ($/EDU/Month)
Monthly Fixed Flow Ra te $29.05
Monthly Fixed EDU Ra te $12.14
Monthly Fixed Service Charge $41.19
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Wastewater Finances & Rates 80
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study In order to mitigate the impact of transitioning to 70% fixed revenue recovery BWA recommends phasing in the rate increases and rate structure adjustments over the next five years as shown on the following table.

Table S13: Domestic Rate 5‐Year Phase‐In Calculation

Domestic Rate 5‐Year Phase‐In Calculation
FY 22‐23
Derived
Rate
Total 5‐
Year Rate
Increase
FY 26‐27
Projected
Rate
V olum e t ric Rate $4.92 21.6% $5.99
Monthly Fixed Service Charge $41.19 21.6% $50.07
FY 21‐22
Exi s ti ng
Rate
FY 26‐27
Projected
Rate
Total 5‐
Year
Change
Single
Year
Change
V olum e t ric Rate $11.28 $5.99 ‐$5.29 ‐1.06
Monthly Fixed Service Charge $11.08 $50.07 $38.99 7.80
FY 21‐22
Exi s ti ng
Rate
Single
Year
Change
Proposed
FY 22‐23
Rate
Proposed
FY 23‐24
Rate
Proposed
FY 24‐25
Rate
Proposed
FY 25‐26
Rate
Proposed
FY 26‐27
Rate
V olum e t ric Rate $11.28 ‐1.06 $10.22 $9.16 $8.10 $7.04 $5.99 Monthly Fixed Service Charge $11.08 7.80 $18.88 $26.68 $34.48 $42.28 $50.08 City Council Regular Meeting - Page 284 of 1385
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

14.9 Non‐Residential Volumetric Rate Derivation
The following table calculates volumetric rates for each commercial customer class by dividing the revenue requirements for each class by the volume of billable usage applicable to each class from Section 14.7. The volume of billable use for each class reflects a 90% RTS factor based on District estimates that 10% of non‐residential water use is not discharged to the wastewater collection system.

Table S14: Non‐Residential Rate Derivation

14.10 School Strength and Flow Rate Derivation
Fixed monthly charges per type of student and staff for schools are derived on the following table based on the approach summarized below:

1. The revenue requirement allocated to schools is divided by the projected flow for the school class to calculate an underlying unit rate ($/Kgal) from Ssection 14.7.

2. The unit rate is multiplied by the estimated wastewater flow for elementary students, junior high students, and staff to develop a revenue requirement for each category from Ssection

14.2. 3. The revenue requirement for each category is then divided by the estimated number of students and staff to derive the monthly rate per each type of student and staff Ssection 14.2.

Commercial and Government Rate
Derivation
Revenue
Requirement Billing Units
Volumetric
Rate
$ Kgal $/Kgal
Government (G) $65,339 5,896 $11.09
Commercial ‐ Low Strength (C_L) $500,416 45,153 $11.09
Commercial ‐ Medium Strength (C_M) $197,126 14,265 $13.82 Commercial ‐ High Strength (C_H) $193,705 10,973 $17.66 City Council Regular Meeting - Page 285 of 1385
Wastewater Finances & Rates 82
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table S15: School Rate Derivation

14.11 Wastewater CIC Charge
The Wastewater Capital Improvement Charge (CIC) was implemented to provide a partial funding source for capital projects that keeps pace with inflation. According to the District’s administrative code, the Wastewater CIC “will be adjusted annually based on the ENR (Engineering News Record) Construction Cost Index (CCI) of February, not to exceed 10%.” The charge is applied by EDU. This results in charges that recover costs in proportion to the amount of system capacity associated with each EDU.

School Rate Derivation
Unit Rate Calculation ($/Kgal) Amount
Volumetric Revenue Requirement $78,161
Flow (Kgal) 8,484.30
Flow Rate ($/Kgal) $9.21
School Rate Calculation
($/person/month) Flow (Kgal)
Rate Revenue
Requirement People
Monthly Rate
Per Person
Elementary Students 5,193.00 $47,840 2,885 $1.39
Junior High Students 1,957.50 $18,033 725 $2.08
Staff 1,333.80 $12,288 494 $2.08
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14.12 Proposed Wastewater Rates
Table S16 shows a 5‐year schedule of proposed wastewater rates. Proposed domestic rates are based on the wastewater rates derived for 2026/27 with rates in the intervening years phased in even increments. The rates are designed to recover the District’s costs of providing wastewater service while achieving roughly balanced budgets in upcoming years.

Table S16: Proposed Wastewater Rates

Current
Wastewater January 1 January 1J a n u a r y 1 January 1J a n u a r y 1 Rates 2023 2024 2025 2026 2027
Residential / Domestic
Includes Single Family (D), Single Family Large Lot (LD), Multi Family (M), Ag Domestic (AT), Commercial Ag (CB) Monthly Fixed Service Charges ($/EDU) $11.08 $18.88 $26.68 $34.48 $42.28 $50.08 Volumetric Charges ($/Kgal) 11.28 10.22 9.16 8.10 7.04 5.98 Commercial / Government
Monthly Fixed Service Charge ($/EDU) $11.08 $12.14 $12.75 $13.39 $14.06 $14.76 Volumetric Charges
Comm ‐ Low Strength (C_L) $11.20 $11.09 $11.64 $12.22 $12.83 $13.47 Comm ‐ Medium Strength (C_M) 13.81 13.82 14.51 15.24 16.00 16.80 Comm‐ High Strength (C_H) 17.22 17.66 18.54 19.47 20.44 21.46 Government (G) 11.20 11.09 11.64 12.22 12.83 13.47
Schools
Monthly charge based on number of students and staff
Elementary Students ($ per student) $1.37 $1.39 $1.46 $1.53 $1.61 $1.69 Junior High Students ($ per student) 2.00 2.08 2.18 2.29 2.40 2.52 School Staff ($ per staff) 2.00 2.08 2.18 2.29 2.40 2.52 Wastewater Capital Improvement Charges (CIC)
Monthly charge per Equivalent Dwelling Unit (EDU) billed to all active wastewater accounts.

Monthly Wastewater CIC Charges $11.68 $12.66
Proposed Maximum Wastewater Rates
Proposed Maximum Rates Effective On or After
Wastewater CIC Charges will be adjusted each January 1
based on the annual change in the Engineering News‐
Record Construction Cost Index for Los Angeles through
February of the preceding year, subject to a maximum
adjustment of 10% per year.

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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

14.13 Wastewater Bill Impacts
Table S17 shows the impacts of the proposed wastewater rates on a range of residential customers with different levels of average winter consumption.

Table S17: Residential Wastewater Rate Impacts

Residential Rates
Existing
FY 21/22
Effective
Jan. 1 2023
Effective
Jan. 1 2024
Effective
Jan. 1 2025
Effective
Jan. 1 2026
Effective
Jan. 1 2027
Total Monthly Fixed Charge
($/EDU/Month) $22.76 $31.54 $39.97 $48.37 $56.73 $65.10 V olum e t ric Flow Rate ($/AWC
Kgal/Month) $11.28 $10.22 $9.16 $8.10 $7.04 $5.98
Monthly Resiential Customer Bill Impacts
Return to Sewer Factor 75.00% 80% 80% 80% 80% 80%
AWC (Kgal) Total Monthly Bill
4 $56.60 $64.24 $69.28 $74.29 $79.25 $84.24
6 $73.52 $80.60 $83.94 $87.25 $90.52 $93.81
12 $124.28 $129.65 $127.91 $126.13 $124.31 $122.51
16 $158.12 $162.36 $157.22 $152.05 $146.84 $141.65
Change in Monthly Bill ($)
4 $7.64 $5.04 $5.01 $4.96 $4.99
6 $7.08 $3.35 $3.31 $3.27 $3.29
12 $5.37 ‐$1.74 ‐$1.78 ‐$1.82 ‐$1.80
16 $4.24 ‐$5.13 ‐$5.17 ‐$5.21 ‐$5.19
Change in Monthly Bill (%)
4 13.51% 7.85% 7.23% 6.68% 6.29%
6 9.62% 4.15% 3.94% 3.75% 3.63%
12 4.32% ‐1.34% ‐1.39% ‐1.44% ‐1.45%
16 2.68% ‐3.16% ‐3.29% ‐3.43% ‐3.53%
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Wastewater Finances & Rates 85
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Figure S5: Combined Single Family Water & Wastewater Bills

City Council Regular Meeting - Page 289 of 1385
Recycled Water Finances & Rates 86
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 15 RECYCLED WATER ENTERPRISE FINANCES & RATES

15.1 Recycled Water System Overview
FPUD provides recycled water generated at the WRP for use as a drought‐proof, locally generated irrigation water supply. FPUD has expanded its recycled water distribution system to increase service area and system capacity. Last year, the District delivered 810 AF (352,000 Kgals) of recycled water for landscape irrigation, sports fields, and nurseries.

15.2 Recycled Water Financial Overview
FPUD’s recycled water enterprise is a financially self‐supporting enterprise that relies primarily on revenues from recycled water rate revenues to fund the costs of providing service. Recycled rate revenues are projected to account for over 95% of total annual revenues, with the remaining revenues coming from interest earnings, property tax allocations and other miscellaneous revenues.

As such, recycled rates must be set at levels adequate to fund the costs of operating and maintaining the recycled system and fund necessary capital improvements to keep the recycled water system in good operating condition.

The District has provided good financial stewardship of the recycled water utility by gradually raising rates each year to keep revenues in line with the cost of providing recycled service.

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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study

15.3 Current & Historical Recycled Rates
Current and historical recycled rates are shown on the table below.

Table R1: Historical Recycled Water Rates

Monthly Fixed Charges FY 17‐18 FY 18‐19 FY 19‐20 FY 20‐21 FY 21‐22 Meter Size Existing
Monthly Fixed Service Charge
3/4" $19.79 $20.98 $22.66 $24.02 $25.22
1" $26.80 $28.41 $30.68 $32.52 $34.15
1 1/2" $44.31 $46.97 $50.73 $53.77 $56.46
2" $65.32 $69.24 $74.78 $79.27 $83.23
3" $121.38 $128.66 $138.95 $147.29 $154.65
4" $184.43 $195.50 $211.14 $223.81 $235.00
6" $359.58 $381.15 $411.64 $436.34 $458.16
Volumetric Rates $/ Kgal
RW Sales $4.81 $5.10 $5.51 $5.84 $6.13
Orange Grove
Jan ‐ June $5.09 $5.66 $6.12 $6.59 $6.19
Jul ‐ Dec $5.66 $6.12 $6.59 $6.19 $6.50
SP&YB
Apr ‐ Sep $2.43 $2.63 $2.83 $3.06 $3.30
Oct ‐ Mar $1.18 $1.28 $1.38 $1.50 $1.61
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 16 RECYCLED WATER FINANCIAL PLAN
BWA developed long‐term cash flow projections to determine the recycled utility’s annual revenue requirements and project required recycled rate revenue increases. The financial projections incorporate the latest information available as well as a number of reasonable assumptions developed with input from the District.

16.1 Financial Plan Assumptions
The following table details the escalation factors used to develop the long‐term cash flow projections.

Table R2: Historical Recycled Water Rates

REVENUE ASSUMPTIONS
 Rate adjustments are assumed to become effective on January 1 of each year.  Recycled water sales revenues are based on recycled sales projections and projected recycled water rates.
 The District projects growth based previous low growth years to ensure rate revenue is sufficient to support District operations.
 Interest earnings are projected based on the annual beginning fund balance multiplied by projected interest rate. The interest rate projections are based on recent and anticipated interest rates increases.
 The District projects property tax revenue increases based on previous low increase years to ensure rate revenue is sufficient to support District operations.  Rent revenue increases are conservatively based on the District’s rental agreements.

EXPENSE ASSUMPTIONS
Escalation Factors FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Salaries 7.0% 8.0% 6.5% 5.0% 5.0%
Benefits 6.5% 7.0% 5.5% 5.0% 5.0%
CPI 5.0% 5.0% 4.5% 4.0% 4.0%
ENR 5.5% 6.7% 4.5% 4.0% 4.0%
ENR + 3% 8.5% 9.7% 7.5% 7.0% 7.0%
Property Tax 1.0% 1.0% 1.0% 1.0% 1.0%
Rent ‐ 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Interest 0.6% 1.0% 1.5% 1.5% 1.5%
Growth 0.15% 0.15% 0.15% 0.15%
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Recycled Water Finances & Rates 89
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study  Operating and maintenance expenses (other than wholesale water costs) are based on the District’s 2022/23 Budget and escalation factors listed above.  The District projects the cost of Salaries to increase based on a recent compensation study it completed and projected future cost of living adjustments.  The District projects the cost of Benefits to increase based on projected salary costs and projected inflation of specific benefit expenses such as health insurance.  CPI cost escalation is based on the recent and historical Consumer Price Index changes. This report projects that the current, extraordinarily high inflation level will gradually drop back towards a normal rate of inflation. Recent cost inflation has been unpredictable, but the CPI escalation projections are informed by recent projections from the Federal Reserve.  ENR cost escalation is based on the recent and historical Engineering News Record Construction Cost Index changes. This report projects that the current, extraordinarily high inflation level will gradually drop back towards a normal rate of inflation. Recent cost inflation has been unpredictable, but the ENR escalation projections are informed by recent projections from the Federal Reserve.
 Debt service projections are based on outstanding debt schedules. The District does not anticipate issuing any additional debt in future years.

16.2 Financial Plan Drivers
The District’s recycled water enterprise is facing a number of manageable financial challenges that will require small gradual rate increases in upcoming years. Key drivers of future rate increases are summarized as below.

Capital Improvement Needs & Rehabilitation of Aging Infrastructure The District’s takes a proactive approach to maintaining its recycled system which requires a steady stream of repair and improvement projects. Accounting for construction cost inflation, the District anticipates funding approximately $0.5 million of capital improvement projects over the next 5 years.

The District will be able to fund this level of capital spending without incurring additional debt.

Ongoing Cost Inflation
The District’s recycled enterprise faces ongoing operating cost inflation due to annual increases in a range of expenses including staffing, utilities, insurance, supplies, etc. On top of rate increases needed for other purposes, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. Historically, inflation consistently hovered between 2% and 3%. Currently, inflation has reach forty year highs with the ENR Construction Cost Index reaching almost 9% in early 2022. The Federal Reserve is projecting inflation will normalize City Council Regular Meeting - Page 293 of 1385
Recycled Water Finances & Rates 90
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study over the next five years. BWA designed the inflation projections to be slightly conservative, to leave the District in a strong financial position while not driving excessive rate increases.

16.3 Cashflow Projection at Existing Rates
Based on project expenses, without any rate increases the recycled water enterprise will operate at a deficit and deplete its reserves within nine years. The following figure shows a 5‐year projection of expenses broken down by key categories, projected annual revenues with no rate increases, and ending reserves compared to the reserve target.

Figure R1: RW 5‐Year Cash Flow Projection Without Rate Increases

16.4 Cashflow Projection and Recommended Rate Increases A summary of the cash flow projections is displayed in the following table. The overall rate revenue increases shown on the table are designed to fund the District’s cost of providing service each year, maintain roughly balanced budgets, meet debt service and coverage requirements, and achieve long‐ term fund reserve targets. The recycled enterprise is projected to meet its fund reserve target in FY 2026/27. Actual impacts to customers’ recycled bills will vary based on customer class and recycled use due to proposed modifications to the rate structure and the updated allocation of costs based on cost‐of‐service analysis. In future years, the District can update the long‐term financial projections and re‐evaluate future revenue requirements and rate projections.

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Recycled Water Finances & Rates 91
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table R3: Proposed Recycled Rate Adjustments

The following figure shows a 5‐year projection of expenses broken down by key categories, projected annual revenues with proposed rate increases, and ending reserves compared to the reserve target.

Figure R2: RW 5‐Year Cashflow Projection With Recommended Rate Increases

The detailed recycled enterprise financial plan is shown in the following table.

RW Financial Dashboard FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Effective Months Jan Jan Jan Jan Jan
RW Rev Adjustments 2.50% 2.50% 2.50% 2.50% 2.50%
Projected Maximum Rate Revenue Increases
Key Financial Information
Revenue from Full Year Rate Increase $30,567 $31,379 $32,211 $33,066 $33,944 Total Revenue $1,299,315 $1,334,514 $1,371,324 $1,406,756 $1,444,262 Total Expenses $1,245,309 $1,292,944 $1,335,373 $1,312,106 $1,343,928 Net Cash Change (Exl. Debt Proceeds $54,006 $41,570 $35,951 $94,649 $100,335 Total Reserves $437,988 $479,558 $515,509 $610,159 $710,493 Reserves Over/Under Target ‐$68,012 ‐$45,866 ‐$27,299 $51,832 $135,938 $0.0
$0.2
$0.4
$0.6
$0.8
$1.0
$1.2
$1.4
$1.6
FY 2023 FY 2024 FY 2025 FY 2026 FY 2027
Millions
PAYGO
Capital
Debt
Service
O&M
Expenses
Proposed
Revenue
Reserves
Target
Reserves
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Table R4: Detailed Recycled Financial Plan

REVENUES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
Revenues from Rates
Full year Adjustme n $30,567 $31,379 $32,211 $33,066 $33,944 Revenues with Full $1,253,265 $1,286,523 $1,320,665 $1,355,712 $1,391,689 Revenues from Current Rates $1,222,697 $1,224,532 $1,226,368 $1,228,208 $1,230,050 Proposed Rev Adjustments $15,284 $46,303 $78,191 $110,971 $144,667 Subtotal Revenues from Rates $1,237,981 $1,270,834 $1,304,559 $1,339,179 $1,374,717 Other Operating Revenues
MWD/CWA I n c e n t i v e $ 0$ 0$ 0$ 0$ 0
Sundry $5,000 $5,000 $5,000 $5,000 $5,000
Subtotal Other Operating Revenue $5,000 $5,000 $5,000 $5,000 $5,000 Non‐Operating Rev
1% Property tax $54,030 $54,300 $54,572 $54,844 $55,393 Interest $2,304 $4,380 $7,193 $7,733 $9,152
Subtotal Non‐Operating Rev $56,334 $58,680 $61,765 $62,577 $64,545 TOTAL REVENUES $1,299,315 $1,334,514 $1,371,324 $1,406,756 $1,444,262 EXPENSES FY 22‐23 FY 23‐24 FY 24‐25 FY 25‐26 FY 26‐27 Budgeted Projected Projected Projected Projected
Operating Expenses
Production $379,361 $403,785 $425,883 $445,010 $465,007 Distribution $35,438 $37,523 $39,437 $41,135 $42,906
Allocated Admin Expenses $197,203 $209,541 $220,297 $230,507 $241,197 Subtotal Operating Expenses $612,002 $650,849 $685,617 $716,652 $749,110 Non‐Operating Expenses
Water Existing Debt $519,307 $519,224 $520,072 $518,980 $519,510 Water New Debt
PAYGO Capital $114,000 $122,871 $129,684 $76,474 $75,308 TOTAL Non‐Operating Expenses $633,307 $642,095 $649,756 $595,454 $594,818 TOTAL EXPENSES $1,245,309 $1,292,944 $1,335,373 $1,312,106 $1,343,928 NET REVENUES $687,313 $683,665 $685,707 $690,103 $695,153 NET CASH CHANGE EXCL. NEW DEBT $54,006 $41,570 $35,951 $94,649 $100,335 BEGINNING BALANCES $383,982 $437,988 $479,558 $515,509 $610,159 ENDING BALANCES W/O DEBT PROC $437,988 $479,558 $515,509 $610,159 $710,493 City Council Regular Meeting - Page 296 of 1385
Recycled Water Finances & Rates 93
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study 17 RECYCLED WATER COST OF SERVICE ANALYSIS & RATE DERIVATION BWA derived recycled water rates that account for the overall rate increases identified in the financial projections. The proposed rates are designed to equitably apportion and recover costs from the District’s customer base.

17.1 Fixed Service Charge Derivation
Fixed monthly recycled service charges recover costs related both to the number of services and meter capacity. The following table shows the number of recycled services by meter size. The table also shows the calculation of the number of recycled water EMUs by multiplying the number of services at each meter size by the meter equivalent ratio for each meter size. An EMU reflects the capacity of each meter size in comparison to the capacity of a ¾” meter.

Table R5: Recycled Services by Meter Size

The fixed monthly recycled water service charge is designed to recover the following costs related to the following functional components:
 Customer includes billing and customer service costs that are the same for each customer regardless of meter size. Customer costs are recovered on a per service basis.  Meter Service includes maintenance and capital costs associated with servicing meters. These costs recovered per equivalent meter unit (EMU). Fixed costs are recovered per unit of capacity (EMU).
 Capacity includes fixed operating and capital costs related to system capacity. These costs are recovered per unit of capacity (EMU). Fixed costs or costs related to system capacity were allocated to this category.

Recycled Water Service
Capacity
Recycled
Water
Services
Maximum
Safe GPM
Meter
Equivalent
Ratios
Equivalent
Meter
Units
Meter Size # # # EMUs
3/4" 1 30 1 1 1" 2 50 2 3 1 1/2" 1 100 3 3 2" 7 160 5 37 3" 9 320 11 96 4" 7 500 17 117 6" 2 1,000 33 67 Total 29 324
Annual Total 348 3,892
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Recycled Water Finances & Rates 94
Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Allocation to Fixed Cost Functional Components
In order to recover costs related to the functional components described above, BWA allocated Administrative Services expenses to be recovered from the fixed service charge based on the Administrative Services allocations to each functional category identified for the water enterprise.

Since Administrative Services was also allocated to other functional cost components for the water enterprise BWA adjusted the allocations to equal 100% for the components used for the recycled water enterprise. The result of this process was the revenue requirement for each functional component. The following table shows this process.

Table R6: Allocation to Fixed Cost Functional Components

Functional Component Unit Costs
The unit cost was then derived for each functional component by dividing the revenue requirement by the number of services or EMUs.

Table R7: Functional Components Unit Costs

Revenue Requirement Total Customer Meter Service Capacity Water Admi n Al l ocati on 15.5% 3.9% 60.0%
Water Admi n Al l ocati on 100% Adj . 19.54% 4.96% 75.50% Admi ni s trati ve Services $73,282 $14,321 $3,632 $55,329 Offsetting Tax Revenue $10,150 $5,000
Total $58,132 $4,171 $3,632 $50,329
Allocation Units Customer Meter Service Capacity
Allocation Unit of Measure ## E M U
A llocat ion Uni ts 348 3,892 3,892
Revenue Requi rement $4,171 $3,632 $50,329
Unit Cost $11.99 $0.93 $12.93
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Fallbrook PUD Water, Wastewater & Recycled Water Rate Study Monthly Fixed Recycled Water Service Charge Derivation
The monthly fixed recycled water service charge was then derived by applying the functional components unit costs to each meter size. The customer unit rate is the same for each meter size.

The meter service and capacity unit rate are multiplied by the AWWA meter equivalent ratios for each meter size to each meter size.

Lynwood City CouncilDecember 20, 2022

Lynwood City Council
December 20, 2022