City Council
259 N. Wilma Avenue
Ripon, CA 95366
MEMO
To: Honorable City Council
From: Christiana Giedd, Associate Civil Engineer
Date: 02/11/2025
Subject: Pavletic Consulting LLC
RECOMMENDED ACTION:
Approve and authorize the Mayor to sign the Professional Services Agreement with Pavletic Consulting LLC for the preparation of a Five-Year Utility Rates Plan and Annual Rate Reviews for the Water, Sewer, and Garbage Utilities for the years 2026-2030 in the not to exceed amount of $36,000 (funding sources: Water, Sewer, and Garbage Operating Funds).
BACKGROUND:
The City of Ripon has three enterprise funds: water, sewer, and garbage. Enterprise funds are operated by the City in a “business-type” manner and the City charges customers for services provided through these enterprises. The revenue generated is intended to provide revenue to adequately fund utility operations, maintenance, capital replacement, and meet debt service obligations, while maintaining a prudent level of reserves.
In 1996, Proposition 218 was approved by the voters that establishes a process by which all public agencies must follow in order to raise taxes or fees. For utility rate increases, the process requires certain findings necessary to increase fees, notice of proposed rate increases to every property owner/renter who pay the utility bill, and the ability to submit a protest ballot opposing the increase. If a majority of ballots are returned that protest the increase, the increase will not take effect.
In 2020, the City contracted Municipal Financial Services (now called Pavletic Consulting LLC) to prepare a Five-Year Utility Rates Plan for the years 2021-2025. As part of that study, utility rate increases for the water, sewer, and garbage enterprise funds were recommended to be implemented February 1st of years 2021, 2022, 2023, 2024, and 2025.
As part of the Council’s approval of the 5-years of rate increases, staff was directed to bring back a financial evaluation each year prior to the rate increase being implemented in order to determine if the full rate increase is necessary.
The last year of these approved rate adjustments have been implemented and now the City of Ripon will need to move forward with an evaluation of water, sewer, and garbage enterprise fund rate adjustments for the years 2026-2030.
DISCUSSION/ANALYSIS:
Pavletic Consulting LLC provided a scope and fee to prepare a Five-Year Utility Rates Plan to be considered by the City Council for the years 2026 through 2030. This study would once again evaluate the adequacy of revenues to meet projected expenditures of the enterprise funds, and if necessary, recommend future rate increases. The scope and fee also includes Annual Rate Reviews which will assist Council in determining whether the full rate increase should be implemented on an annual basis.
Staff recommends the City Council approve the attached Professional Services Agreement with Pavletic Consulting LLC in the not to exceed amount of $36,000.
FINANCIAL IMPACT:
The cost to complete the work within the proposal is a not to exceed amount of $36,000, which will be funded through the Water, Sewer, and Garbage Enterprise Funds as shown in Table 2.
Table 2 – Funding Breakdown
Enterprise Operating Fund Amount
Water $12,000
Sewer $12,000
Garbage $12,000
Total $36,000
Attachments:
1. Services Agreement_Pavletic Consulting, LLC
2. Exhibit A_Pavletic Consulting LLC