CITY OF PACIFICA
COUNCIL AGENDA SUMMARY REPORT
7/8/2024
1 SUBJECT:
Resolution of the City Council of the City of Pacifica Accepting the Report of Sewer Service Charges for Fiscal Year 2024-2025 and Directing the Filing of Charges for Collection by the County Controller.
RECOMMENDED ACTION:
Move to adopt the proposed "Resolution of the City Council of the City of Pacifica accepting the report of Sewer Service Charges for Fiscal Year 2024-2025, and directing the filing of charges for collection by the County Controller" to place the assessment charges on the County of San Mateo Property Tax Roll.
STAFF CONTACT:
Yulia Carter, Assistant City Manager
650-738-7402
[email protected]
Louis Sun, Deputy Director of Public Works - Wastewater 650-738-4660
[email protected]
BACKGROUND/DISCUSSION:
On May 9, 2022 the City Council approved Ordinance 879-C.S., which established a methodology for the collection of sewer service charges and enacted a new five year rate structure with a maximum annual rate increase for the City’s Wastewater Program service charges from Fiscal Years 2022-23 through 2026-27. A second reading of the ordinance was conducted and approved at the May 23, 2022, meeting. The Ordinance amended sections 6-6.403 through 6-
6.408 of Chapter 6 Title 6 (Sewer Charges) of the Pacifica Municipal Code to reflect the new rate structure. The revenues generated by this rate structure are the main source of revenue for the City’s Wastewater Program and address its future capital and financial needs (detailed below):
Table 1 - Summary of Residential Rate Modifications
Maximum Rate
2022-23 2023-24 2024-25 2025-26 2026-27
Percent Increase 3.5% 3.5% 3.5% 3.5% 3.5%
Rate* $19.47221 $20.15374 $20.85912 $21.58919 $22.34481 Minimum Annual Rate $934.66 $967.38 $1001.24 $1036.28 $1072.55 *Unit calculated by multiplying total use by a factor of 0.9 Pacifica City Council 2
July 08, 2024
Table 2 - Summary of Commercial Rate Modifications
Maximum Rate
2022-23 2023-24 2024-25 2025-26 2026-27
Percent Increase 3.5% 3.5% 3.5% 3.5% 3.5%
Rate* $19.47221 $20.15374 $20.85912 $21.58919 $22.34481 Minimum Annual Rate $934.66 $967.38 $1001.24 $1036.28 $1072.55 * Unit calculated by total use multiplied by strength factor (see Table 3) Table 3 City of Pacifica Proposed Commercial Strength Factors Customer Class Current
Car Washes 0.9
Cleaners 1.2
Laundromats 0.75
Restaurants with Grease Traps 1.6
Restaurants without Grease Traps 1.8
Gymnasiums 0.9
All Other Commercial Use 1.0
This resolution implements the sewer service charges for Fiscal Year 2024-2025 (see Attachment 1) and reflects a rate increase of 3.5% above the 2023-24 rates. As previously presented in the Sewer Rate Study this 3.5% increase is based on the following:
• Anticipated 2024-2025 expenditures for the operations, maintenance, repair, and management of the City’s Wastewater Program;
• Maintaining a reserve for contingencies which funds operations and maintenance costs for 90 days;
• Construction of wastewater capital projects;
• Providing the Wastewater Enterprise Fund with the appropriate debt service coverage (net operating revenue over debt service payments).
The new rate structure and the 2024-25 rate proposal are supported by a detailed rate study conducted by Bartle Wells Associates dated January 26, 2022. The Proposition 218 review/process is not required for this resolution since the City adhered to this process as part of the approval of the 5-year rate cycle approved on May 23, 2022.
The charges presented in this report have been calculated in accordance with the amended Municipal Code Section 6-6.404. A list of sewer charges applied to each parcel is kept in the Finance Department at City Hall and public inspection and verification can be arranged by appointment.
ALTERNATIVE ACTION:
The City Council may elect not to adopt the resolution approving the sewer service charges for FY 2024-25 and lower the rates from what is being proposed. This will result in a significant decrease in Wastewater revenues and may result in delays in implementation of the Capital Improvement Projects included in the rate study assumptions.
Pacifica City Council 3
July 08, 2024
RELATION TO CITY COUNCIL GOALS AND WORK PLAN:
Adopting the resolution approving the sewer service charges for FY 2024-25 is consistent with the following Council adopted Goal:
• “Enhance organizational and Fiscal Stability” and “Improve and Steward City Infrastructure, streets and facilities”
FISCAL IMPACT:
The projected 3.5% rate increase will generate approximately an additional $1 Million, which will raise Wastewater revenues to between $18 million to $19 million already included in the FY 2024- 25 Budget and will allow the Fund to meet projected expenses.
ORIGINATED BY:
Public Works - Wastewater Division
Public Works - Wastewater Division
ATTACHMENT LIST:
Attachment A: Sewer Service Charges 2024-25 (PDF)
Pacifica City Council 4
July 08, 2024
RESOLUTION NO. _________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PACIFICA ACCEPTING THE REPORT OF SEWER SERVICE CHARGES FOR FISCAL YEAR 2024-2025 AND DIRECTING
THE FILING OF CHARGES FOR COLLECTION BY THE COUNTY CONTROLLER WHEREAS, pursuant to Section 6-6.502 of the Pacifica Municipal Code and Section 5473 of the California Health & Safety Code, the City has received a report of sewer charges for Fiscal Year 2024-25, computed in conformity with the City’s schedule of sewer charges (“Report”) is on file in the Office of the City Clerk and available for public inspection and is incorporated herein by reference; and
WHEREAS, the City Council desires to approve the Report and to submit the charges described therein to the San Mateo County Controller for collection on the 2024-2025 tax roll.
NOW, THEREFORE, BE IT RESOLVED that the City Council hereby approves the Report as submitted, and
BE IT FURTHER RESOLVED that the City Clerk hereby adopts the FY2024-2025 sewer service charges in the amount between $18 million to $19 million and directs staff to file the necessary documents with the Controller to ensure that the said fees are included on the County of San Mateo Property Tax Roll for Tax Year 2024-2025.
• • • • •
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Pacifica, California, held on the 8th day of July 2024, by the following vote:
AYES, Councilmembers:
NOES, Councilmembers:
ABSENT, Councilmembers:
ABSTAIN, Councilmembers:
_________________________________
Sue Vaterlaus, Mayor
ATTEST: APPROVED AS TO FORM:
______________________________ _________________________________ Sarah Coffey, City Clerk Michelle Kenyon, City Attorney