ACTION: Opened, conducted and closed public hearing; introduced and adopted City Council Ordinance No. 2
026-04, establishing rates for sewer service charges for the Vista Sewer System; and introduced and adopted B
uena Sanitation District Ordinance No. 2026-01, establishing rates for sewer service charges for the Buena Sewer System. Vote: 5-0.
Clerk/Secretary
Department: Engineering Item No: PH1
Prepared by:
Ken Knatz, Sewer Engineering Manager
Erin Adams, Administrative Programs Manager Meeting Date: May 26, 2026 Approved by:
Greg Mayer, Director of Engineering
John Conley, City Manager Agenda Location: Public Hearing SUBJECT: SEWER SER
VICE RATES FOR FISCAL YEARS 2026/27 THROUGH 2028/29
RECOMMEND
ATION:
1. Open, conduct and close public hearing regarding the proposed sewer service rates for Fiscal Year 2026/27 through 2028/29.
2. Introduce and Adopt City Council Ordinance No. 2026- , establishing rates for sewer service charges for the Vista Sewer System.
3. Introduce and Adopt Buena Sanitation District Ordinance No. 2026- , establishing rates for sewer service charges for the Buena Sewer System.
CORRELATIO
N TO CITY COUNCIL GOALS: Fiscal Responsibility.
PRIOR ACT
ION: On March 24, 2026, received and filed the City of Vista Wastewater Rate Study from Water Resources Economics; received and filed the Buena Sanitation District Wastewater Rate Study from Water Resources Economics; and set a Public Hearing for May 26, 2026, to Introduce and Adopt City of Vista and Buena Sanitation District Sewer Service Charges for Fiscal Years 2026/27 through 2028/29 (Vote: 5-0).
On February 10, 2026, directed staff to finalize the sewer cost of service rate study report using the proposed increase of 5.5% for City of Vista customers and 4.0% for Buena Sanitation District customers for FY 26/27 - 28/29; adopted City Council Resolution No. 2026-27; and Buena Sanitation District Resolution No. 2026-02; and directed staff to increase funding for the Lifeline Sewer Rebate Program by $25,000 as part of the next operating budget discussion (Vote: 5-0).
Please see Exhibit 14 for a complete list of City Council and Buena Sanitation District Board actions.
STATEME
NT ON THE SUBJECT: In 2025, the City of Vista (City) and Buena Sanitation District (Buena) initiated comprehensive wastewater rate studies to evaluate the financial needs of the wastewater enterprises, ensure compliance with Proposition 218, and update the cost of service basis for wastewater rates. Water Resources Economics, LLC (WRE) completed the 2026 Wastewater Rate Studies in March 2026.
AGENDA
REPORT
CITY COUNCIL
COMMUNITY DEVELOPMENT COMMISSION
SUCCESSOR AGENCY
BUENA SANITATION DISTRICT
JOINT POWERS FINANCING AUTHORITY
05/26/2026
PH1
MEETING DATE: May 26, 2026 PAGE 2
SUBJECT: SEWER RATES FOR FISCAL YEARS 2026/27 TO 2028/29 On March 24, 2026, the City Council (Council) and Buena Sanitation District Board of Directors (Board) received and filed wastewater rate studies for Vista and Buena (Exhibits 1 and 2). The Council and Board set a Public Hearing for May 26, 2026, to receive testimony regarding the proposed sewer rates. Public Hearing notices (Exhibits 3, 4, 5, and 6) were mailed in both English and Spanish to every property owner with sewer service in Vista and Buena on March 30, 2026, more than 45 days in advance of the Public Hearing and invited written support or opposition. Public Hearing notices were also published on the City website with supplemental detailed information on the sewer and Lifeline Rebate program. Written correspondence received as of the writing of this report is included as Exhibit 7. Written comments may be submitted until the Public Hearing is closed; and additional written comments received will be included with the final report. If a majority protest does not exist, the Council and Board may consider and adopt the recommended ordinances (Exhibits 8 and 9) establishing sewer rates for Fiscal Years 2026/27 through 2028/29.
The studi
es evaluated projected operating costs, Encina treatment charges, capital improvement needs, reserve requirements, and customer usage characteristics. Based on these findings, WRE recommended several updates to the City’s wastewater billing methodology to improve equity, accuracy, and compliance with cost of service principles. Key elements of the studies are as follows:
Three Y
ear Wastewater Rate Schedule. To meet projected operating, capital, and reserve requirements, the study recommends revenue increases of 5.5% for City of Vista and 4.0% for Buena Sanitation District customers covering Fiscal Years 2026/27 through FY 2028/29. The study maintains the City’s existing rate structure but updates the underlying cost allocations and unit costs to ensure compliance with Proposition 218, which requires that fees not exceed proportional cost of service. The rate schedules are attached as Exhibits 10 and 11, key details include:
• Updated flat fee single family and multifamily residential rates – first year annual increase between $21 and $53.
• Updated commercial/industrial strength based rates – increases to high strength customers since treatment costs at Encina Wastewater Authority are influenced by concentration of pollutants, including biochemical oxygen demand (BOD) and total suspended solids (TSS) in the wastewater. • Updated commercial/industrial capacity rental charges – customers are charged based on their allocated (purchased) wastewater flow capacity; properties that require additional flow beyond their current allocation will see a capacity rental charge increase of approximately $107 to $125 per Equivalent Dwelling Unit (EDU).
These adju
stments are necessary to maintain the utility enterprises and support the City and District’s planned investments, including approximately $81.3 million in capital improvements identified in the Vista and Buena 2025 Sewer Master Plan.
Update t
o EDU Flow Definition. The current EDU definition assumes 200 gallons per day (gpd) of wastewater flow per EDU. Updated system flow data indicate that actual wastewater generation has declined. The study recommends reducing the EDU flow assumption to 160 gpd. This revision aligns the EDU standard with current wastewater flow patterns and industry benchmarks, and it improves the proportionality of charges across all customer classes.
Revi
sed Billing Method for Commercial Customers with Irrigation Usage. Commercial customers exhibit varying irrigation practices, and not all accounts have separate irrigation meters. To ensure wastewater charges reflect only water entering the sewer system, the study recommends:
• Customers with separate irrigation meters: Bill based on actual metered indoor water usage. • Customers without irrigation meters: Bill based on the lowest two months of annual water usage, which serves as a proxy for indoor, sewer contributing demand.
This approach improves accuracy and equity in estimating wastewater flows for commercial accounts. 05/26/2026
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MEETING DATE: May 26, 2026 PAGE 3
SUBJECT: SEWER RATES FOR FISCAL YEARS 2026/27 TO 2028/29 Eli
mination of Laundry and Car Wash Variances. Vista and Buena currently provide reduced wastewater charges for laundry facilities and car washes based on water recirculation practices. The study determined that all discharge from these facilities ultimately enters the wastewater system, and therefore the existing discounts are not supported by cost of service principles. The recommendation is to discontinue these variances and apply standard billing methodologies to all such customers.
Imp
lementation and Billing. Updated sewer rates will become effective on June 25, 2026, 30 days after adoption of the recommended ordinances. Approval of the ordinances also provides authorization to the county assessor to collect the updated sewer service charges on the San Diego County Property Tax Roll through the entirety of the three-year wastewater rate schedule without additional administrative action by the Council or Board. This provides a more streamlined customer process and reduces administrative overhead to the utility enterprises. The Finance Department has compiled a report with FY 2026/27 customer sewer service charges covering the period of July 1, 2026, through June 30, 2027, that is on file with City Clerk’s Office (Exhibits 12 and 13). City and Buena’s Sewer Assessment reports for FY 2027/28 and FY 2028/29 will be prepared and placed on file with the City Clerk’s Office by the beginning of each fiscal year. Subsequent fiscal year assessment reports will be forwarded to county assessor in August for collection with property taxes for the corresponding billing year.
FISC
AL IMPACT: FY 2026/27 sewer revenues are estimated at $29,848,613 for the City of Vista and $10,495,340 for the Buena Sanitation District. City of Vista revenues include $24,905,287 in sewer service charges to be collected on the property tax roll (attached as Exhibit 12), $1,173,192 in hand-billed sewer service charges for properties not receiving property tax bills, $3,120,134 in operating revenues, and $650,000 in capacity charges. Buena Sanitation District revenues include $8,724,086 in sewer service charges to be collected on the property tax roll (attached as Exhibit 13), $101,694 in hand-billed sewer service charges for properties not receiving property tax bills, $1,369,560 in operating revenues, and $300,000 in capacity charges. These revenues fund the operation, maintenance, and capital improvements of the sewer systems and are legally restricted for sewer utility purposes.
EXHIBITS:
1. City of Vista Wastewater Rate Study from Water Resources Economics
2. Buena Sanitation District Wastewater Rate Study from Water Resources Economics
3. City of Vista Proposition 218 Notice to Sewer Customers
4. Ciudad de Vista Tarifas de Alcantarillado Propuestas julio 2026 – julio 2028
5. Buena Sanitation District Proposition 218 Notice to Sewer Customers 6 Distrito de Saneamiento de Buena Tarifas de Alcantarillado Propuestas julio 2026 – julio 2028
7. Written correspondence received regarding proposed rate increases
8. City Council Ordinance No. 2026-
9. Buena Sanitation District No. Ordinance 2026-
10. City of Vista Sewer FY 2027/28 through FY 2029/30 Sewer Rate Schedule
11. Buena Sanitation District FY 2027/28 through FY 2029/30 Sewer Rate Schedule
12. Report of Vista Sewer Assessment for FY 2026/27 (on file in the Office of the City Clerk)
13. Report of Buena Sanitation District Sewer Assessment for FY 2026/27 (on file in the Office of the City Clerk)
14. City Council and Buena Sanitation District Prior Actions 05/26/2026
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City of Vista
2026
Wastewater Rate Study
Final Report – March 2026
Prepared by: Water Resources Economics, LLC
05/26/2026
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EXHIBIT 1
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March 16, 2026
Ken
Knatz, PE
Sewer Engineering Manager
City of Vista | Buena Sanitation District
200 Civic Center Drive
Vista, CA 92084
Subje
ct: City of Vista Wastewater Rate Study Report
Dear Mr
. Knatz,
Wate
r Resources Economics, LLC (WRE) is pleased to submit this 2026 Wastewater Rate Study Report to the City of Vista (City). This report documents the results and recommendations of the City’s wastewater rate study. The goal of the study was to develop a three-year schedule of wastewater rates that will sufficiently fund the City’s wastewater system expenses, allow the City to meet its financial goals within the study period, and comply with cost-of-service principles.
This
study utilized industry-standard rate-setting methodology and incorporates guidance provided by the City Council. Our project team has a proven track record of developing fair and equitable wastewater rates for numerous public agencies in California over the past 25 years. We are confident in our ability to develop sound wastewater rates that satisfy the requirements of Proposition 218.
It has
been a pleasure assisting the City with this engagement, and we appreciate the support provided by yourself, the City Council, and other City staff during this study.
Since
rely,
Sanjay G
aur Hannah Phan
President Principal Consultant
05/26/2026
PH1
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City of Vista
2026 Wastewater Rate Study
Wastewater Resources Economics
i
TABLE OF CONTENTS
1. Executive Summary .................................................................................................................. 1
1.1 System Overview .......................................................................................................................... 1
1.2 Rate Study Overview .................................................................................................................... 1
1.3 Legal Requirements ...................................................................................................................... 1
1.4 Rate-Setting Methodology ........................................................................................................... 1
1.5 Additional Information and Disclaimers ....................................................................................... 2
1.6 Current Wastewater Rates ........................................................................................................... 2
1.7 Financial Plan ................................................................................................................................ 3
1.8 Proposed Wastewater Rates ........................................................................................................ 4
2. Financial Plan ........................................................................................................................... 6
2.1 Financial Plan Methodology ......................................................................................................... 6
2.2 Revenues ....................................................................................................................................... 6
2.3 Operating Expenses ...................................................................................................................... 9
2.4 Debt Service ................................................................................................................................ 10
2.5 Capital Improvement Plan .......................................................................................................... 10
2.6 Financial Policies ......................................................................................................................... 12
2.7 No Revenue Adjustment Financial Plan...................................................................................... 12
2.8 Proposed Financial Plan .............................................................................................................. 18
3. COST-OF-SERVICE ANALYSIS ................................................................................................... 23
3.1 Cost-of-Service Methodology ..................................................................................................... 23
3.2 Revenue Requirement ................................................................................................................ 23
3.3 Mass Balance .............................................................................................................................. 24
3.4 Units of Service ........................................................................................................................... 25
3.5 Functional Categories ................................................................................................................. 26
3.6 Operating Cost Allocation ........................................................................................................... 27
3.7 Capit
al Cost Allocation ................................................................................................................ 28
3.8 Revenue Requirement Allocation ............................................................................................... 28
3.9 Unit Cost Derivation ................................................................................................................... 28
3.10 Cost-of-Service by Customer Class ............................................................................................. 29
4. Wastewater Rates .................................................................................................................. 30
4.1 Wastewater Rate Overview ........................................................................................................ 30
4.2 Proposed Changes to the Rate Structure ................................................................................... 30
4.3 Revenue Adjustments ................................................................................................................. 31
4.4 wastewater Rate Calculation ...................................................................................................... 31
4.5 Proposed Residential Wastewater Charge ................................................................................. 32
4.6 Proposed Commercial Wastewater Charge ............................................................................... 32
4.7 Proposed Capacity Rental Charge .............................................................................................. 32
4.8 Proposed Wastewater Rate Schedule ........................................................................................ 33 05/26/2026
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City of Vista
2026 Wastewater Rate Study
Wastewater Resources Economics
ii
4.9 Customer Impacts ....................................................................................................................... 34
5. Appendix ............................................................................................................................... 35
LIST OF TABLES
Table 1-1: Current Wastewater Rates ...................................................................................................... 3 Table 1-2: Proposed Financial Plan Scenario ............................................................................................ 4 Table 1-3: Proposed Three-Year Wastewater Rate Schedule .................................................................. 5 Table 2-1: Current Wastewater Rates ...................................................................................................... 7 Table 2-2: Projected Customer Accounts/Units ....................................................................................... 8 Table 2-3: Calculated Rate Revenues at Current Rates ............................................................................ 8 Table 2-4: Revenue Summary ................................................................................................................... 9 Table 2-5: Operating Expenses Escalation Factors ................................................................................... 9 Table 2-6: Operating Expenses ............................................................................................................... 10 Table 2-7: Existing and Proposed Debt Service ...................................................................................... 10 Table 2-8: Capital Improvement Projects ............................................................................................... 11 Table 2-9: Capital Financing Plan ............................................................................................................ 12 Table 2-10: No Revenue Adjustment Financial Plan Scenario ................................................................ 13 Table 2-11: Projected Cash Flows (No Revenue Adjustment Financial Plan) ......................................... 14 Table 2-12: Projected Fund Balances (No Revenue Adjustment Financial Plan) ................................... 15 Table 2-13: Forecasted Financial Performance (No Revenue Adjustment Financial Plan) .................... 16 Table 2-14: Proposed Financial Plan Scenario ........................................................................................ 18 Table 2-15: Projected Cash Flows (Proposed Financial Plan) ................................................................. 19 Table 2-16: Projected Fund Balances (Proposed Financial Plan) ........................................................... 20 Table 2-17: Forecasted Financial Performance (Proposed Financial Plan) ............................................ 21 Table 3-1: FY 2026 Revenue Requirement ............................................................................................. 24 Table 3-2: Wastewater Flow and Strength Estimates ............................................................................ 24 Table 3-3: Mass Balance ......................................................................................................................... 25 Table 3-4: Units of Service by Customer Class ....................................................................................... 26 Table 3-5: Operating Costs by System Function ..................................................................................... 26 Table 3-6
: Capital Expenses by System Function .................................................................................... 27 Table 3-7: Functional Cost Allocation ..................................................................................................... 27 Table 3-8: Operating Cost Allocation ...................................................................................................... 27 Table 3-9: Capital Cost Allocation ........................................................................................................... 28 Table 3-10: Revenue Requirement Allocation ........................................................................................ 28 Table 3-11: Unit Cost Calculations .......................................................................................................... 29 Table 3-12: Cost-of-Service by Customer Class ...................................................................................... 29 Table 4-1: Proposed Revenue Adjustments ........................................................................................... 31 Table 4-2: Residential Rates Calculation ................................................................................................ 31 Table 4-3: Industrial/Commercial Rates Calculation .............................................................................. 31 Table 4-4: Proposed Residential Wastewater Charge after Adjustment ............................................... 32 Table 4-5: Proposed Commercial Wastewater Charge after Adjustment .............................................. 32 05/26/2026
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2026 Wastewater Rate Study
Wastewater Resources Economics
iii
Table 4-6: Proposed Capacity Rental Charge Calculation ...................................................................... 33 Table 4-7: Proposed Sanitation Rates Schedule ..................................................................................... 34 Table 4-8: Proposed Residential Customer Impacts ............................................................................... 34 Table 5-1: O&M Allocation ..................................................................................................................... 35 Table 5-2: Capital Allocation ................................................................................................................... 36 Table 5-3: Encina Cost Allocation ........................................................................................................... 37
LIST OF FIGURES
Figure
2-1: Revenue Requirements vs. Revenues (No Revenue Adjustment Financial Plan) ................ 17 Figure 2-2: Projected Debt Coverage (No Revenue Adjustment Financial Plan) ................................... 17 Figure 2-3: Projected Fund Balances (No Revenue Adjustment Financial Plan) .................................... 18 Figure 2-4: Revenue Requirements vs. Revenues (Proposed Financial Plan) ........................................ 21 Figure 2-5: Projected Debt Coverage (Proposed Financial Plan) ............................................................ 22 Figure 2-6: Projected Fund Balances (Proposed Financial Plan) ............................................................ 22 05/26/2026
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City of Vista
2026 Wastewater Rate Study
Wastewater Resources Economics
1 1. EXECUTIVE SUMMARY
1.1 SYSTEM OVERVIEW
The City of Vista (City) owns and operates approximately 216 miles of sanitary sewer system that collect wastewater from approximately 17,300 residential, commercial, and industrial accounts. The City contracts with Encina Wastewater Authority (Encina) to provide wastewater treatment services and pump station operations.
1.2 RATE STUDY OVERVIEW
Public retail wastewater agencies in California typically conduct a cost-of-service study every five years to ensure that customers are appropriately charged for wastewater service and to reestablish the cost-of-service nexus that is required by Proposition 218. The City has engaged Water Resources Economics, LLC (WRE) to conduct a comprehensive wastewater rate study, with the following objectives:
• Evaluate a five-year financial plan scenario to meet financial targets for Fiscal Year (FY) 2027 to FY 2031
• Conduct a cost-of-service analysis based on the most recent data and customer characteristics • Develop a three-year wastewater rate schedule for FY 2027 through FY 2029
1.3 LEGAL REQUIREMENTS
Legal considerations relating to retail wastewater rates in California focus heavily on Proposition 218, which was enacted in 1996 and is now reflected in Article XIII C and Article XIII D of the California Constitution. Proposition 218 states that “property related fees and charges” (which include retail wastewater rates) may not exceed the proportional cost of providing the service to the customer and may not be used for any purpose other than providing said service. The practical implication is that public retail wastewater agencies in California must demonstrate a sufficient nexus between the costs incurred by the agency to provide wastewater service and the rates charged to customers. The primary means by which retail wastewater agencies address this requirement is by conducting a “cost-of-service analysis.”
Pro
position 218 also affects the rate adoption process by requiring agencies to hold a public hearing to adopt rates. The agency must mail public hearing notices to all customers no fewer than 45 days prior to the public hearing. The public hearing notices must clearly show all proposed rate changes, provide information on the public hearing date/time/location, and provide instructions on how customers may protest the proposed rate changes. If a majority of customers submit a protest, the proposed rate changes cannot be adopted.
1.4 RATE-SETTING METHODOLOGY
This study was conducted using industry-standard methodology and includes the following steps:
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City of Vista
2026 Wastewater Rate Study
Wastewater Resources Economics
2 1. Financial Plan: Annual revenues and expenses are projected over the rate-setting period to determine the magnitude of rate increases needed to maintain financial sufficiency. Financial policies, such as reserve targets, are also evaluated and updated if necessary.
2. Cost-of-Service Analysis: Costs are allocated to customers in proportion to use of and burden on the wastewater system. The overall goal is to establish a robust nexus between the costs incurred by an agency and the rates charged to customers, as required by Proposition 218.
3. Rate Design: The existing rate structure is evaluated, and potential changes are identified. A multi-year proposed rate schedule is then calculated directly from the results of the financial plan and cost-of-service analysis.
4. Rate Study Documentation: A rate study report is developed to document the proposed rate development process. This provides transparency and enhances compliance with Proposition 218 requirements. This document serves as the report for this rate study.
1.5 ADDITIONAL INFORMATION AND DISCLAIMERS
This report summarizes the data, analyses, processes, and results of the City’s wastewater rate study.
Some important information to keep in mind when reading the report includes the following:
• All study projections are based on the best available data as of December 2025.
• All table values are rounded to the nearest digit shown unless stated otherwise. However, all calculations are based on precise values. Attempting to manually recreate the calculations described in this report from the values displayed in tables may therefore produce slightly different results.
• All current and proposed rates and charges in this report are shown on an annual basis.
1.6 CURRENT WASTEWATER RATES
The City’s current wastewater rate structure, shown in Table 1-1, is charged annually on the San Diego County Property Tax bill and includes the following components:
• Single Family and Multi-Family Residential rates are based on number of dwelling units • Industrial and Commercial rates include a fixed component based on equivalent dwelling units (EDU), a strength-based component based on hundred cubic feet (hcf) of estimated wastewater flows and strength category, and an extra strength component based on pounds of biochemical oxygen demand (BOD) and suspended solids (SS) • Capacity rental charges are based on excess EDU usage
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City of Vista
2026 Wastewater Rate Study
Wastewater Resources Economics
6 2. FINANCIAL PLAN
2.1 FINANCIAL PLAN METHODOLOGY
The purpose of a financial plan is to project revenues, expenses, cash flows, reserve balances, and debt coverage over a multi-year period to assess financial sufficiency and performance and to determine the amount of required rate revenue. For this study, the planning period is from FY 2027 through FY 2031; data for FY 2026 are shown when needed to represent actual or budgeted data inputs. The key steps in developing a financial plan for a wastewater enterprise are below:
• Revenue projections: Annual revenues from rates and other miscellaneous sources are projected over the planning period. Rate revenues are projected based on current rates to establish baseline revenues from which the need for additional rate increases can be evaluated.
• Expense projections: Annual expenses are projected over the study period, including O&M expenses, debt service, and CIP costs. CIP funding options (grants, debt, etc.) are evaluated. • Financial policy evaluation: Key financial policies include debt coverage requirements and reserve targets. Debt coverage requirements are typically explicitly stated in official agreements on outstanding debt issuances. Reserve targets are typically set by an agency’s elected officials and may need to be periodically evaluated and updated. • No revenue adjustments financial plan projections: Cash flow, reserve balances, and debt coverage are projected over the study period in the absence of additional rate increases.
Projected reserve balances and debt coverage are then compared to the agency’s financial policy requirements and targets. The no revenue adjustments financial plan provides a baseline for evaluating the need for rate increases.
• Proposed financial plan projections: The magnitude and timing of annual proposed revenue increases over the study period are evaluated and determined based on the agency’s financial policies, financial performance, and policy objectives. Proposed rate increases (referred to as “revenue adjustments”) should generate sufficient revenue to recover the agency’s expenses, maintain adequate reserves, and meet all debt coverage requirements. The proposed financial plan determines the total annual rate revenue requirement over the study period.
2.2 REVENUES
CURRENT WASTEWATER RATES
The City’s current wastewater rate structure (Table 2-1) is charged annually on the San Diego County Property Tax bill and includes the following components:
• Single Family and Multi-Family Residential rates are based on number of dwelling units • Industrial and Commercial rates include a fixed component based on equivalent dwelling units (EDU), a strength-based component based on hundred cubic feet (hcf) of estimated wastewater flows and strength category, and an extra strength component based on pounds of biochemical oxygen demand (BOD) and suspended solids (SS) • Capacity rental charges are based on excess EDU usage 05/26/2026
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Wastewater Resources Economics
23 3. COST-OF-SERVICE ANALYSIS
3.1 COST-OF-SERVICE METHODOLOGY
A cost-of-service (COS) analysis is a technical process used to determine the cost of providing wastewater service to the City’s customers based on each customer’s use of and burden on the wastewater system. The COS analysis is the basis of the nexus between the costs incurred by the utility to provide wastewater service and the wastewater rates charged to customers, which is a requirement of Proposition 218.
The CO
S methodology is based on industry standards set forth by the Water Environment Federation (WEF). The overall goal of the cost-of-service analysis is to develop “unit costs,” which provide the basis from which proposed rates are calculated. Note that although the study period spans multiple years, the cost-of-service analysis is limited to a single representative year referred to as the “test year.” The test year in this study is FY 2026.
The k
ey steps in conducting a cost-of-service analysis are outlined below:
• Revenue requirement determination: The revenue requirement for the test year is determined based on the results of the proposed financial plan and divided into primary sub- components (operating, capital, etc.).
• Cost functionalization: O perating and capital costs are evaluated and assigned to “functional categories” in the wastewater system (e.g., flow, treatment, billing, etc.). This provides a proportional breakdown of system costs by functional category. • Revenue requirement allocation to cost causation components: Fu nctionalized costs are allocated to “cost causation components” (e.g., flow, BOD, TSS, billing, etc.), which are used to attribute customers’ use of the system to the City’s functional costs. • Unit cost development: The allocation of revenue requirements for each individual cost causation component is divided by the appropriate units of service to establish unit costs for the test year. Unit costs provide the basis from which proposed rates are calculated.
3.2 REVENUE REQUIREMENT
The total rate revenue requirement for the test year, FY 2026, is based on the financial plan projections (Table 2-15) and is allocated between the Operating, Capital and Revenue Offset components, as shown in Table 3-1. The Operating revenue requirement consists of operating expenses (Line 2). The Capital revenue requirement includes debt service (Line 3), rate-funded CIP (Line 4), capital revenue (Line 8), capacity rental charge revenue (Line 9), and adjustments for cash from reserves (Line 15; from Table 2-15, Line 28). The Revenue Offset includes all other revenues and interest income (Lines 10-11). The total revenue requirement (Line 18) is equal to the amount of rate revenue collected in FY 2026 (Table 2-15, Line 2).
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Wastewater Resources Economics
30 4. WASTEWATER RATES
4.1 WASTEWATER RATE OVERVIEW
The proposed wastewater rate schedule was developed based on the results of the proposed financial plan and cost-of-service analysis. The key steps in developing the proposed rate schedule are outlined below:
• Test year rate development: Rates are calculated under the proposed rate structure for the cost-of-service test year (FY 2026). Rate calculations directly incorporate the unit costs developed in the cost-of-service analysis. The test year rates are first calculated on a revenue neutral basis and are then increased based on the proposed financial plan revenue adjustments. Although total rate revenues in the first year of adjustments (FY 2027) are designed to increase by the proposed revenue adjustment percentage (5.5% in FY 2027), the proposed percentage increase to each rate/charge varies due to the updated cost-of-service allocations.
• Rate schedule development: P roposed rates for the full study period are calculated by increasing the cost-of-service rates by the proposed annual revenue adjustment percentages from the proposed financial plan.
4.2 PROPOSED CHANGES TO THE RATE STRUCTURE
The main objective of the rate study was to conduct a comprehensive cost-of-service analysis while maintaining as much of the current wastewater rate structure as possible to minimize customer impacts. The City’s current wastewater rate structure includes an annual service charge based on customer class and a variable rate for commercial/industrial customers based on annual usage.
After
examining current customer classification and discussion with City staff regarding customer usage patterns, WRE recommends the following changes:
• Reducing the gallons per day (gpd) definition from 200 gpd per EDU to 160 gpd due to reductions in wastewater flow.
• Currently, the City provides laundry and car wash discounts to customers who request a variance due to their water recirculation practices. However, upon further investigation, it was found that all discharge for these facilities enters the wastewater system. Thus, no discount should be offered.
• Among the commercial customers, some have separate irrigation meters, and some do not.
For customers with separate irrigation meters, the City should bill based on the actual water usage since irrigation is accounted for in a separate meter. For customers without irrigation meters, the City should bill based on the lowest two months of water usage to account for irrigation usage which does not enter the wastewater system. 05/26/2026
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Buena Sanitation
District
2026 Wastewater Rate Study
Final Report – March 2026
Prepared by: Water Resources Economics, LLC
05/26/2026
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EXHIBIT 2
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March 16, 2026
Ken
Knatz, PE
Sewer Engineering Manager
City of Vista | Buena Sanitation District
200 Civic Center Drive
Vista, CA 92084
Subje
ct: Buena Sanitation District Wastewater Rate Study Report Dear M
r. Knatz,
Wate
r Resources Economics, LLC (WRE) is pleased to submit this 2026 Wastewater Rate Study Report to the Buena Sanitation District (District). This report documents the results and recommendations of the District’s wastewater rate study. The goal of the study was to develop a three-year schedule of wastewater rates that will sufficiently fund the District’s wastewater system expenses, allow the District to meet its financial goals within the study period, and comply with cost-of-service principles.
This
study utilized industry-standard rate-setting methodology and incorporates guidance provided by the Buena Sanitation District Board. Our project team has a proven track record of developing fair and equitable wastewater rates for numerous public agencies in California over the past 25 years. We are confident in our ability to develop sound wastewater rates that satisfy the requirements of Proposition 218.
It has
been a pleasure assisting the District with this engagement, and we appreciate the support provided by yourself, the District Board, and other District staff during this study.
Since
rely,
Sanjay G
aur Hannah Phan
President Principal Consultant
05/26/2026
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Buena Sanitation District
2026 Wastewater Rate Study
Wastewater Resources Economics
i
TABLE OF CONTENTS
1. Executive Summary .................................................................................................................. 1
1.1 System Overview .......................................................................................................................... 1
1.2 Rate Study Overview .................................................................................................................... 1
1.3 Legal Requirements ...................................................................................................................... 1
1.4 Rate-Setting Methodology ........................................................................................................... 1
1.5 Additional Information and Disclaimers ....................................................................................... 2
1.6 Current Wastewater Rates ........................................................................................................... 2
1.7 Financial Plan ................................................................................................................................ 3
1.8 Proposed Wastewater Rates ........................................................................................................ 4
2. Financial Plan ........................................................................................................................... 6
2.1 Financial Plan Methodology ......................................................................................................... 6
2.2 Revenues ....................................................................................................................................... 6
2.3 Operating Expenses .................................................................................................................... 10
2.4 Debt Service ................................................................................................................................ 11
2.5 Capital Improvement Plan .......................................................................................................... 11
2.6 Financial Policies ......................................................................................................................... 12
2.7 No Revenue Adjustment Financial Plan...................................................................................... 12
2.8 Proposed Financial Plan .............................................................................................................. 18
3. COST-OF-SERVICE ANALYSIS ................................................................................................... 23
3.1 Cost-of-Service Methodology ..................................................................................................... 23
3.2 Revenue Requirement ................................................................................................................ 23
3.3 Mass Balance .............................................................................................................................. 24
3.4 Units of Service ........................................................................................................................... 26
3.5 Functional Categories ................................................................................................................. 27
3.6 Operating Cost Allocation ........................................................................................................... 28
3.7 Cap
ital Cost Allocation ................................................................................................................ 29
3.8 Revenue Requirement Allocation ............................................................................................... 29
3.9 Unit Cost Derivation ................................................................................................................... 30
3.10 Cost-of-Service by Customer Class ............................................................................................. 30
4. Wastewater Rates .................................................................................................................. 32
4.1 Rate Design Methodology .......................................................................................................... 32
4.2 Proposed Changes to the Rate Structure ................................................................................... 32
4.3 Revenue Adjustments ................................................................................................................. 33
4.4 wastewater Rate Calculation ...................................................................................................... 33
4.5 Proposed Residential Wastewater Charge ................................................................................. 34
4.6 Proposed Commercial Wastewater Charge ............................................................................... 34
4.7 Proposed Capacity Rental Charge .............................................................................................. 35
4.8 Proposed Sanitation Rate Schedule............................................................................................ 36 05/26/2026
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4.9 Customer Impacts ....................................................................................................................... 37
5. Appendix ............................................................................................................................... 39
LIST OF TABLES
Table 1-1: Current Wastewater Rates ...................................................................................................... 3 Table 1-2: Proposed Financial Plan Scenario ............................................................................................ 4 Table 1-3: Proposed Three-Year Wastewater Rate Schedule .................................................................. 5 Table 2-1: Current Wastewater Rates ...................................................................................................... 7 Table 2-2: Projected Customer Accounts/Units ....................................................................................... 8 Table 2-3: Calculated Rate Revenues at Current Rates ............................................................................ 9 Table 2-4: Revenue Summary ................................................................................................................. 10 Table 2-5: Operating Expenses Escalation Factors ................................................................................. 10 Table 2-6: Operating Expenses ............................................................................................................... 10 Table 2-7: Capital Improvement Projects ............................................................................................... 11 Table 2-8: Capital Financing Plan ............................................................................................................ 12 Table 2-9: No Revenue Adjustment Financial Plan Scenario .................................................................. 12 Table 2-10: Projected Cash Flows (No Revenue Adjustment Financial Plan) ......................................... 14 Table 2-11: Projected Fund Balances (No Revenue Adjustment Financial Plan) ................................... 15 Table 2-12: Forecasted Financial Performance (No Revenue Adjustment Financial Plan) .................... 16 Table 2-13: Proposed Financial Plan Scenario ........................................................................................ 18 Table 2-14: Projected Cash Flows (Proposed Financial Plan) ................................................................. 19 Table 2-15: Projected Fund Balances (Proposed Financial Plan) ........................................................... 20 Table 2-16: Forecasted Financial Performance (Proposed Financial Plan) ............................................ 21 Table 3-1: FY 2026 Revenue Requirement ............................................................................................. 24 Table 3-2: Wastewater Flow and Strength Estimates ............................................................................ 25 Table 3-3: Mass Balance ......................................................................................................................... 26 Table 3-4: Units of Service Summary by Customer Class ....................................................................... 27 Table 3-5: Operating Costs by System Function ..................................................................................... 28 Table 3-6: Capital Expenses by System Function .................................................................................... 28 Table
3-7: Functional Cost Allocation ..................................................................................................... 28 Table 3-8: Operating Cost Allocation ...................................................................................................... 29 Table 3-9: Capital Cost Allocation ........................................................................................................... 29 Table 3-10: Revenue Requirement Allocation ........................................................................................ 30 Table 3-11: Unit Cost Calculations .......................................................................................................... 30 Table 3-12: Cost-of-Service by Customer Class ...................................................................................... 31 Table 4-1: Proposed Revenue Adjustments ........................................................................................... 33 Table 4-2: Residential Rates Calculation ................................................................................................ 33 Table 4-3: Industrial/Commercial Rates Calculation .............................................................................. 34 Table 4-4: Proposed Residential Wastewater Charge after Adjustment ............................................... 34 Table 4-5: Proposed Commercial Wastewater Charge after Adjustment .............................................. 35 Table 4-6: Proposed Capacity Rental Charge Calculation ...................................................................... 36 05/26/2026
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Table 4-7: Proposed Sanitation Rates Schedule ..................................................................................... 37 Table 4-8: Proposed Residential Customer Impacts ............................................................................... 38 Table 5-1: O&M Allocation ..................................................................................................................... 39 Table 5-2: Capital Allocation ................................................................................................................... 40 Table 5-3: Encina Cost Allocation ........................................................................................................... 41
LIST OF FIGURES
Figure 2-1: Revenue Requirements vs. Revenues (No Revenue Adjustment Financial Plan) ................ 17 Figure 2-2: Projected Fund Balances (No Revenue Adjustment Financial Plan) .................................... 17 Figure 2-3: Revenue Requirements vs. Revenues (Proposed Financial Plan) ........................................ 21 Figure 2-4: Projected Fund Balances (Proposed Financial Plan) ............................................................ 22
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1 1. EXECUTIVE SUMMARY
1.1 SYSTEM OVERVIEW
Buena Sanitation District (District) owns and operates approximately 101 miles of sanitary sewer system that collect wastewater from approximately 6,700 residential, commercial, and industrial accounts. The District contracts with Encina Wastewater Authority (Encina) to provide wastewater treatment services and pump station operations.
1.2 RATE STUDY OVERVIEW
Public retail wastewater agencies in California typically conduct a cost-of-service study every five years to ensure that customers are appropriately charged for wastewater service and to reestablish the cost-of-service nexus that is required by Proposition 218. The District has engaged Water Resources Economics, LLC (WRE) to conduct a comprehensive wastewater rate study, with the following objectives:
• Evaluate a five-year financial plan scenario to meet financial targets for Fiscal Year (FY) 2027 to FY 2031
• Conduct a cost-of-service analysis based on the most recent data and customer characteristics • Develop a three-year wastewater rate schedule for FY 2027 through FY 2029
1.3 LEGAL REQUIREMENTS
Legal considerations relating to retail wastewater rates in California focus heavily on Proposition 218, which was enacted in 1996 and is now reflected in Article XIII C and Article XIII D of the California Constitution. Proposition 218 states that “property related fees and charges” (which include retail wastewater rates) may not exceed the proportional cost of providing the service to the customer and may not be used for any purpose other than providing said service. The practical implication is that public retail wastewater agencies in California must demonstrate a sufficient nexus between the costs incurred by the agency to provide wastewater service and the rates charged to customers. The primary means by which retail wastewater agencies address this requirement is by conducting a “cost-of-service analysis.”
Proposition 218 also affects the rate adoption process by requiring agencies to hold a public hearing to adopt rates. The agency must mail public hearing notices to all customers no fewer than 45 days prior to the public hearing. The public hearing notices must clearly show all proposed rate changes, provide information on the public hearing date/time/location, and provide instructions on how customers may protest the proposed rate changes. If a majority of customers submit a protest, the proposed rate changes cannot be adopted.
1.4 RATE-SETTING METHODOLOGY
This study was conducted using industry-standard methodology and includes the following steps:
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2 1. Financial Plan: Annual revenues and expenses are projected over the rate-setting period to determine the magnitude of rate increases needed to maintain financial sufficiency. Financial policies, such as reserve targets, are also evaluated and updated if necessary.
2. Cost-of-Service Analysis: Costs are allocated to customers in proportion to use of and burden on the wastewater system. The overall goal is to establish a robust nexus between the costs incurred by an agency and the rates charged to customers, as required by Proposition 218.
3. Rate Design: The existing rate structure is evaluated, and potential changes are identified. A multi-year proposed rate schedule is then calculated directly from the results of the financial plan and cost-of-service analysis.
4. Rate Study Documentation: A rate study report is developed to document the proposed rate development process. This provides transparency and enhances compliance with Proposition 218 requirements. This document serves as the report for this rate study.
1.5 ADDITIONAL INFORMATION AND DISCLAIMERS
This report summarizes the data, analyses, processes, and results of the District’s wastewater rate study. Some important information to keep in mind when reading the report includes the following:
• All study projections are based on the best available data as of December 2025.
• All table values are rounded to the nearest digit shown unless stated otherwise. However, all calculations are based on precise values. Attempting to manually recreate the calculations described in this report from the values displayed in tables may therefore produce slightly different results.
• All current and proposed rates and charges in this report are shown on an annual basis.
1.6 CURRENT WASTEWATER RATES
The District’s current wastewater rate structure, shown in Table 1-1, is charged annually on the San Diego County Property Tax bill and includes the following components:
• Single Family and Multi-Family Residential rates based on number of dwelling units • Industrial and Commercial rates include a fixed component based on equivalent dwelling units (EDUs), a strength-based component based on hundred cubic feet (hcf) of estimated wastewater flows and strength category, and an extra strength component based on pounds of biochemical oxygen demand (BOD) and suspended solids (SS) • Capacity rental charges are based on excess EDU usage • Rates are differentiated between customers within City limits and within the County/San Marcos service area
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6 2. FINANCIAL PLAN
2.1 FINANCIAL PLAN METHODOLOGY
The purpose of a financial plan is to project revenues, expenses, cash flows, reserve balances, and debt coverage over a multi-year period to assess financial sufficiency and performance and to determine the amount of required rate revenue. For this study, the planning period is from FY 2027 through FY 2031. The key steps in developing a financial plan for a wastewater enterprise are below:
• Revenue projections: Annual revenues from rates and other miscellaneous sources are projected over the planning period. Rate revenues are projected based on current rates to establish baseline revenues from which the need for additional rate increases can be evaluated.
• Expense projections: Annual expenses are projected over the study period, including O&M expenses, debt service, and CIP costs. CIP funding options (grants, debt, etc.) are evaluated. • Financial policy evaluation: Key financial policies include debt coverage requirements and reserve targets. Debt coverage requirements are typically explicitly stated in official agreements on outstanding debt issuances. Reserve targets are typically set by an agency’s elected officials and may need to be periodically evaluated and updated. • No revenue adjustments financial plan projections: Cash flow, reserve balances, and debt coverage are projected over the study period in the absence of additional rate increases.
Projected reserve balances and debt coverage are then compared to the agency’s financial policy requirements and targets. The no revenue adjustments financial plan provides a baseline for evaluating the need for rate increases.
• Proposed financial plan projections: The magnitude and timing of annual proposed revenue increases over the study period are evaluated and determined based on the agency’s financial policies, financial performance, and policy objectives. Proposed rate increases (referred to as “revenue adjustments”) should generate sufficient revenue to recover the agency’s expenses, maintain adequate reserves, and meet all debt coverage requirements. The proposed financial plan determines the total annual rate revenue requirement over the study period.
2.2 REVENUES
CURRENT WASTEWATER RATES
The District’s current wastewater rate structure (Table 2-1) is charged annually on the San Diego County Property Tax bill and includes the following components:
• Single Family and Multi-Family Residential rates based on number of dwelling units (EDUs) • Industrial and Commercial rates include a fixed component based on equivalent dwelling units (EDUs), a strength-based component based on hundred cubic feet (hcf) of estimated wastewater flows and strength category, and an extra strength component based on pounds of biochemical oxygen demand (BOD) and suspended solids (SS) • Capacity rental charges are based on excess EDU usage 05/26/2026
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13 NO REVENUE ADJUSTMENT CASH FLOW PROJECTIONS
Table 2-10 shows the cash flow projections for the no revenue adjustment financial plan. Revenues (Lines 1-7) are from Table 2-4. Operating expenses (Lines 9-14) are from Table 2-6. Net operating revenue (Line 26) is equal to the difference between total revenues (Line 7) and total operating expenses (Line 14). Rate funded CIP (Line 23) is the total capital projects from Table 2-8. The no revenue adjustment scenario assumes no new debt; all CIP is expected to be rate funded. Net cash flow (Line 28) is equal to the net operating revenue (Line 26) less rate funded CIP (Line 23).
The net operating revenue in this scenario is positive for all years except FY 2031, meaning that the District’s current revenues are sufficient to fund its operating expenses for four years out of the five in the study period. However, the net cash flow in the no revenue adjustment scenario is negative for all years, meaning that the District’s current forecasted revenues are not sufficient to fund its annual CIP.
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23 3. COST-OF-SERVICE ANALYSIS
3.1 COST-OF-SERVICE METHODOLOGY
A cost-of-service (COS) analysis is a technical process used to determine the cost of providing wastewater service to the District’s customers based on each customer’s use of and burden on the wastewater system. The COS analysis is the basis of the nexus between the costs incurred by the utility to provide wastewater service and the wastewater rates charged to customers, which is a requirement of Proposition 218.
The COS methodology is based on industry standards set forth by the Water Environment Federation (WEF). The overall goal of the cost-of-service analysis is to develop “unit costs,” which provide the basis from which proposed rates are calculated. Note that, although the study period spans multiple years, the cost-of-service analysis is limited to a single representative year referred to as the “test year.” The test year in this study is FY 2026.
The key steps in conducting a cost-of-service analysis are outlined below:
• Revenue requirement determination: The revenue requirement for the test year is determined based on the results of the proposed financial plan and divided into primary sub- components (operating, capital, etc.).
• Cost functionalization: Operating and capital costs are evaluated and assigned to “functional categories” in the wastewater system (e.g., flow, treatment, billing, etc.). This provides a proportional breakdown of system costs by functional category. • Revenue requirement allocation to cost causation components: Functionalized costs are allocated to “cost causation components” (e.g., flow, BOD, TSS, billing, etc.), which are used to attribute customers’ use of the system to the District’s functional costs. • Unit cost development: The allocation of revenue requirements for each individual cost causation component is divided by the appropriate units of service to establish unit costs for the test year. Unit costs provide the basis from which proposed rates are calculated.
3.2 REVENUE REQUIREMENT
The total rate revenue requirement for the test year, FY 2026, is based on the financial plan projections (Table 2-14) and is allocated between the Operating, Capital and Revenue Offset components, as shown in Table 3-1. The Operating revenue requirement consists of operating expenses (Line 2). The Capital revenue requirement includes debt service (Line 3), rate funded CIP (Line 4), capital revenue (Line 8), capacity rental charge revenue (Line 9), and adjustments for cash from reserves (Line 15; from Table 2-14, Line 28). The Revenue Offset includes all other revenues and interest income (Lines 10-11). The total revenue requirement (Line 18) is equal to the amount of rate revenue collected in FY 2026 (Table 2-14, Line 2).
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32 4. WASTEWATER RATES
4.1 RATE DESIGN METHODOLOGY
The proposed wastewater rate schedule was developed based on the results of the proposed financial plan and cost-of-service analysis. The key steps in developing the proposed rate schedule are outlined below:
• Test year rate development: Rates are calculated under the proposed rate structure for the cost-of-service test year (FY 2026). Rate calculations directly incorporate the unit costs developed in the cost-of-service analysis. The test year rates are first calculated on a revenue- neutral basis and are then increased based on the proposed financial plan revenue adjustments. Although total rate revenues in the first year of adjustments (FY 2027) are designed to increase by the proposed revenue adjustment percentage (4% in FY 2027), the proposed percentage increase to each rate/charge varies due to the updated cost-of-service allocations.
• Rate schedule development: Proposed rates for the full study period are calculated by increasing the cost-of-service rates by the proposed annual revenue adjustment percentages from the proposed financial plan.
4.2 PROPOSED CHANGES TO THE RATE STRUCTURE
The main objective of the rate study was to conduct a comprehensive cost-of-service analysis while maintaining as much of the current wastewater rate structure as possible to minimize customer impacts. The District’s current wastewater rate structure includes an annual service charge based on customer class and a variable rate for commercial/industrial customers based on annual usage.
After examining current customer classification and discussion with District staff regarding customer usage patterns, WRE recommends the following changes:
• Reducing the gallons per day (gpd) definition from 200 gpd per EDU to 160 gpd due to reductions in wastewater flow.
• Currently, the District provides laundry and car wash discounts to customers who request a variance due to their water recirculation practices. However, upon further investigation, it was found that all discharge for these facilities enters the wastewater system. Thus, no discount should be offered.
• Among the commercial customers, some have separate irrigation meters, and some do not.
For customers with separate irrigation meters, the District should bill based on the actual water usage since irrigation is accounted for in a separate meter. For customers without irrigation meters, the District should bill based on the lowest two months of water usage to account for irrigation usage which does not enter the wastewater system. • During the mass balance process, the District’s BOD readings showed high strength readings.
We recommend that the District conduct an audit of residential water use in the District to pinpoint the source of high strength readings.
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EXHIBIT 4
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EXHIBIT 6
WRITTEN CORRESPONDENCE
SEWER SERVICE CHARGES
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EXHIBIT 7
ORDINANCE NO. 2026-
AN ORDINANCE OF THE CITY COUNCIL OF THE CHARTERED CITY OF
VISTA, CALIFORNIA, ADOPTING THE REPORT FOR SEWER SERVICE CHARGES FOR FISCAL YEARS 2026/27 THROUGH 2028/29 AND
ESTABLISHING RATES FOR SEWER SERVICE CHARGES FOR THE
VISTA SEWER SYSTEM
The City Council of the City of Vista does ordain as follows:
1. Findings. The City Council hereby finds and declares all of the following:
A. Chapter 14.04 of the Vista Municipal Code imposes a sewer service charge on each parcel of real property or lot having a connection to the sewer system of the City of Vista ("Sewer System") and further provides that the rates for the sewer service charge may be established or adjusted from time to time by the City Council upon adoption of an ordinance.
B. The City Council has received a report and recommendations (the "Report") from its consultant, Water Resources Economics, LLC, entitled City of Vista 2026 Wastewater Rate Study, March 2026, which contains an analysis of the requirements of the Sewer System and recommendations for the method and basis for establishing and adjusting rates for sewer service charges for use of the Sewer System.
C. Pursuant to City Council Resolution 2026-26, the City of Vista has elected to collect sewer service charges through the San Diego County Property Tax Roll.
D. The City Council received and filed the Report on March 24,2026, and, in reliance on the facts, estimates and other information provided therein, the City Council desires and intends to approve the Report and to establish rates for the sewer service charges imposed upon all users of the Sewer System, and to submit the sewer service charges described therein for Fiscal Years 2026/27 through 2028/29 to the San Diego County Auditor for collection on the tax roll.
E. Pursuant to the requirements of Article XIII D of the California Constitution, the City Council has duly provided notice of the proposed increase in rates to all affected property owners of record and, not less than 45 days after having given such notice on March 30, 2026, the City Council conducted a public hearing on the proposed rate increases at which hearing all persons having an interest in the proposed rates had the opportunity to give written or oral testimony and to file written protests and the City Clerk determined that the number of written protests received from affected property owners was less than 50 percent of the total number of such owners.
[Continued on next page]
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EXHIBIT 8
ORDINANCE NO. 2026-
CITY COUNCIL OF THE CHARTERED CITY OF VISTA
PAGE 2
2. Action
A. T
he City Council hereby repeals City Council Ordinance No. 2017-19.
B. The City Council hereby approves the Report as submitted and authorizes the sewer service charges for Fiscal Years 2026/27 through 2028/29 in conformance with said Report and this ordinance.
C. Definitions. For purposes of this Ordinance the following terms shall have the meanings described below.
"Account" in the case of industrial and commercial users, shall mean each individual user of the Sewer System having an account with the City. "BOD" or "Biochemical Oxygen Demand" a measurement of the oxygen utilized during a five day incubation period for the biological degradation of organic and inorganic waste.
"City" shall mean the City of Vista.
"Dwelling Unit" shall mean a measure of the number of living units in a facility.
"EDU" or "Equivalent Dwelling Unit" shall mean a unit of measurement of
sewage that is equivalent to the average flow volume and strength characteristics of a typical single family residence of the community, as may be established from time to time by a resolution approved by the City Council.
"Flow Rate" shall mean that portion of the sewer service charge calculated upon the actual or imputed water consumption for the parcel of real property, measured in HCF.
"HCF" shall mean a unit of one hundred cubic feet of municipal water delivered to the user for a given period of time. This unit is used to estimate the volume of wastewater discharged by the user into the Sewer System.
"Multi-family" shall mean one or more structures containing three or more dwelling units intended for residential use located on any parcel of real property or lot, including but not limited to, mobile home parks. "Rate" shall mean the fixed or variable amount identified in the Rate Table used to calculate the sewer service charge on a parcel of real property or lot.
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"Rate Category" shall mean the various categories based upon the use of the parcel of real property as defined in Section 2 of this Ordinance for determining the rates for calculating the sewer service charges. "Rate Table" shall mean the table of rates approved in Section 3 of this Ordinance for determining the sewer service charge imposed on any parcel of real property or lot connected to the Sewer System. "Revenue Program Guidelines" shall mean Appendix G of the Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities, published by the California State Water Resources Control Board, March 1998 edition or as may subsequently be amended. "Sewer Service Charge" shall mean the charge or fee imposed on each parcel of real property or lot connected to the Sewer System pursuant to Chapter 14.04 of the Municipal Code of the City.
"Sewer System" shall mean the system of sanitary and wastewater local drains, main lines, pumping stations, force mains, lift stations, collection and treatment facilities, disposal facilities and all appurtenances thereto owned and operated by the City.
"Single-family" shall mean a structure containing a single dwelling unit or a duplex dwelling unit intended for occupancy by one family or two families respectively and located on a parcel of real property or lot. "Strength" refers to the "Commercial User Strength Characteristics" of wastewater discharges from commercial or industrial users, and is a measure of the BOD (mg/1) and SS (mg/1) as used in the Exhibit G, page G- 21, of the Revenue Program Guidelines.
"Strength Flow Rate" shall mean that portion of the
industrial/commercial or high volume user sewer service charge calculated upon the actual or imputed Strength of the sewage discharged into the Sewer System and actual or imputed water consumption for the parcel, measured in HCF.
"Total Suspended Solids" shall mean the residue retained on a standard glass-fiber after drying to a constant weight at 103 to 105 centigrade, as set forth in Method Number 240D of the current approved edition of the Standard Methods for the Examination of Water and Wastewater or other comparable EPA approved methods found in 40 CFR Part 136.
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received into the Sewer System.
"User" shall mean any discharger into the Sewer System whether or not the user owns the parcel of real property or lot on which the use is located. The sewer service charge is imposed upon the parcel of real property or lot that is connected to the Sewer System on which the user is located. The use occurring on the parcel of real property or lot determines the rate category for the purpose of establishing the appropriate rate of the sewer service charge.
D
. Rate Categories. The following rate categories for various users connected to the Sewer System, based upon the actual use of the parcel of real property or lot connected to the Sewer System, are hereby established.
A. Residential/Single-Family
The Residential/Single-Family rate category shall include the followi
ng uses:
(1) Each parcel of real property or lot having a distinct assessor's parcel number on which a separate single-family dwelling unit is constructed and used for residential purposes.
(2) Each individually owned or controlled dwelling unit having a distinct assessor's parcel number within a condominium or cooperative ownership development.
The sewer service charge for each single-family dwelling unit located on any parcel of real property or lot containing one or more single-family structures in the Residential/Single-Family rate category shall consist of a Fixed Rate for each Fiscal Year identified in the Rate Table below.
B. Residential/Multi-Family
The Residential/Multi-Family rate category shall include the following uses:
(1) Every parcel of real property or lot having a distinct assessor's parcel number on which multiple-dwelling units are constructed and used for residential purposes . Each living unit available for residential occupancy shall be considered a separate dwelling unit.
(2) Every mobile home park on which factory assembled or mobile homes are located and used for residential purposes. Each available space shall be considered as a separate dwelling unit.
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The
sewer service charge for each dwelling unit located on any parcel of real property or lot in the Residential/Multi-Family rate category shall consist of the Fixed Rate for each Fiscal Year identified in the Rate Table below.
C. Industrial/Commercial
The Industrial/Commercial rate category shall include each and every parcel of real property or lot used for any purpose other than residential use and which is connected to the Sewer System. This category includes, without limitation:
(1) Any and all commercial uses such as retail, office
and professional, or commercial products distribution, warehousing and storage facilities.
(2) Any and all industrial uses such as manufacture or
assembly plant , food processing facilities, or industrial products distribution , storage or warehousing facilities .
(3) Any and all governmental uses such as schools,
hospitals, office buildings, distribution, maintenance or storage facilities. (4) All other uses not included in (1) through (3) above.
For each such use the sewer service charge upon the parcel shall inc
lude the Fixed Rate and the Strength Flow Rate for each Fiscal Year identified in the Rate Table below. The Strength Flow Rate categories of High, Medium or Low for each parcel shall be determined in accordance with the recommendations of the Revenue Program Guidelines. The Strength Flow Rate shall be a variable amount based upon the Strength and the actual or imputed aggregate water consumption of the parcel measured in HCF reported by the municipal water supplier for the entire calendar year immediately preceding the fiscal year in which the Strength Rate is applied.
E.Rates. Rates for the sewer service charge imposed upon each parcel of real property or lot having a connection to the Sewer System according to the respective Rate Category, are hereby fixed and established, for each of the Fiscal Years identified, as presented in the Rate Table below. [Continued on next page]
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VISTA SEWER SYSTEM: SEWER SERVICE RATES
Unit/yr.
Unit/yr.
Indu
strial/Commercial
per EDU
FIXED PORTION $177 $215 $227 $240
owned
STRENGTH PORTION
Low Strength per HCF $6.56 $6.07 $6.41 $6.77
Medium Strength per HCF $7.70 $7.52 $7.94 $8.38
High Strength per HCF $11.00 $12.58 $13.28 $14.02
CAPACITY RENTAL
CHARGE
Per Excess EDU Used $546 $671 $671 $671
________________________________________________________________________
CUSTOMER CURRENT
CLASS RATES
FY 2026-
2027
FY 2027-
2028
FY 2028-
2029
Residential
SINGLE-FAMILY Per $708 $744 $785 $829
MULTI-FAMILY Per $495 $521 $550 $581
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3. Procedure. The City Council has conducted all proceedings required to set sewer service charges under Article XIII D of the California Constitution.
4. Publication; no codification. Following the adoption of this ordinance the City Clerk shall cause this ordinance or a summary of it to be published in a newspaper of general circulation within the City of Vista in the manner required by law. This ordinance shall not be codified.
5. Transmission to the San Diego County Auditor. On or before August 10, 2026, the City Clerk of the Board is directed to transmit this Resolution and the Report to the San Diego County Auditor and to annually file the necessary documents with the Auditor such that the sewer service charges for Fiscal Years 2026/27 through 2028/29, as set forth in the Report, will be included on the San Diego County Property Tax Roll.
6. Effective Date. This ordinance shall be in full force and effect the 31 st day following the date of its adoption.
7. Adoption. INTRODUCED and ADOPTED at a meeting of the City Council held on May 26, 2026, by the following vote:
AYES:
NOES:
ABS
TAIN:
APPROVED AS TO FORM:
WALTER CHUNG, CITY ATTORNEY
By:____________________________
APPROVED
Walter C. Chung
20260518090139
By:____________________________
JOHN FRANKLIN, MAYOR
ATTEST:
KATHY VALDEZ, CITY CLERK
By:____________________________
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ORDINANCE
NO. 2026-
AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE
BUENA SANITATION DISTRICT, ADOPTING THE REPORT OF
SEWER SERVICE CHARGES FOR FISCAL YEARS 2026/27
THROUGH 2028/29 AND ESTABLISHING RATES FOR SEWER
SERVICE CHARGES FOR THE BUENA SEWER SYSTEM
The Board of Directors of the Buena Sanitation District does ordain as follows:
1. Findings. The Buena Sanitation District Board of Directors hereby finds and declares all of the following:
A. Chapter 4 of the Buena Sanitation District Code imposes a sewer service charge on each parcel of real property or lot having a connection to the sewer system of the Buena Sanitation District ("Sewer System") and further provides that the rates for the sewer service charge may be established or adjusted from time to time by the Board of Directors upon adoption of an ordinance .
B. The Board of Directors has received a report and recommendations (the "Report") from its consultant, Water Resources Economics, LLCentitled Buena Sanitation District Wastewater Rate Study, March 2026, which contains an analysis of the requirements of the Sewer System and recommendations for the method and basis for establishing and adjusting rates for sewer service charges for use of the Sewer System.
C. Pursuant to Buena Sanitation District Resolution 2026-02, the City of Vista and the Buena Sanitation District has elected to collect sewer service charges through the San Diego County Property Tax Roll.
D. The Board of Directors received and filed the Report on March 24, 2026, and, in reliance on the facts, estimates and other information provided therein, the Board of Directors desires and intends to approve the Report and establish rates for the sewer service charges imposed upon all users of the Sewer System , and to submit the sewer service charges described therein for Fiscal Years 2026/27 through 2028/29 to the San Diego County Tax Auditor for collection on the tax roll E. Pursuant to the requirements of Article XIII D of the California Constitution, the Board of Directors has duly provided notice of the proposed rates to all affected property owners of record and, not less than 45 days after having given such notice on March 30, 2026, the Board of Directors conducted a public hearing on the proposed rates at which hearing all persons having an interest in the proposed rates had the opportunity to give written or oral testimony and to file written protests and the Clerk of the Board determined that the number of written protests received from affected property owners was less than 50 percent of the total number of such owners. [Continued on next page]
05/26/2026
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EXHIBIT 9
ORDINANCE NO. 2026-
BUENA SANITATION DISTRICT
2. Action
A. The Board of Directors hereby repeals City Council Ordinance No. 2017-01 B. The Board of Directors hereby approves the Report as submitted and authorizes the sewer service charges for Fiscal Years 2026/27 through 2028/29 in conformance with said Report and this ordinance.
C. Definitions. For purposes of this Ordinance the following terms shall have the meanings described below .
"Account" in the case of industrial and commercial users, shall mean each individual user of the Sewer System having an account with the District. "BOD" or "Biochemical Oxygen Demand " a measurement of the oxygen utilized during a five day incubation period for the biological degradation of organic and inorganic waste .
"District" shall mean the Buena Sanitation District.
"Dwelling Unit" shall mean a measure of the number of living units in a facility.
"EDU"or "Equivalent Dwelling Unit" shall mean a unit of measurement of sewage that is equivalent to the average flow volume and strength characteristics of a typical single family residence of the community, as may be established from time to time by a resolution approved by the Board of Directors. "Flow Rate" shall mean that portion of the sewer service charge calculated upon the actual or imputed water consumption for the parcel of real property, measured in HCF.
"HCF" shall mean a unit of one hundred cubic feet of municipal water delivered to the user for a given period of time. This unit is used to estimate the volume of wastewater discharged by the user into the Sewer System . "Multi-family" shall mean one or more structures containing three or more dwelling units intended for residential use located on any parcel of real property or lot, including but not limited to , mobile home parks.
"Rate" shall mean the fixed or variable amount ident ified in the Rate Table used to calculate the sewer service charge on a parcel of real property or lot. "Rate Category shall mean the various categories based upon the use of the parcel of real property as defined in Section 2 of this Ordinance for determining the rates for calculating the sewer service charges.
"Rate Table" shall mean the table of rates approved in Section 3 of this Ordinance for determining the sewer service charge imposed on any parcel of real 05/26/2026
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ORDINANCE NO. 2026-
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prope
rty or lot connected to the Sewer System.
"Revenue Program Guidelines" shall mean Appendix G of the Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities, published by the California State Water Resources Control Board, March 1998 edition or as may subsequently be amended.
"Sewer Service Charge" shall mean the charge or fee imposed on each parcel of real property or lot connected to the Sewer System pursuant to Chapter 4 of the District Code.
"Sewer System " shall mean the system of sanitary and wastewater local drains, main lines , pumping stations , force mains , lift stations , collection and treatment facilities, disposal facilities and all appurtenances thereto owned and operated by the Buena Sanitation District.
"Single-family" shall mean a structure containing a single dwelling unit or a duplex dwelling unit intended for occupancy by one family or two families respectively and located on a parcel of real property or lot. "Strength" refers to the "Commercial User Strength Characteristics" of wastewater discharges from commercial or industrial users, and is a measure of the BOD (mg/1) and SS (mg/1) as used in the Exhibit G, page G-21, of the Revenue Program Guidelines.
"Strength Flow Rate" shall mean that portion of the industrial/commercial or high volume user sewer service charge calculated upon the actual or imputed Strength of the sewage discharged into the Sewer System and actual or imputed water consumption for the parcel, measured in HCF.
"Total Suspended Solids" shall mean the residue retained on a standard glass-fiber after drying to a constant weight at 103 to 105 centigrade, as set forth in Method Number 240D of the current approved edition of the Standard Methods for the Examination of Water and Wastewater or other comparable EPA approved methods found in 40 CFR Part 136.
"Total Treatment Capacity" shall mean the total permitted capacity owned or operated by the District for treatment and discharge of all wastewater received into the Sewer System.
"User" shall mean any discharger into the Sewer System whether or not the user owns the parcel of real property or lot on which the use is located. The sewer service charge is imposed upon the parcel of real property or lot that is connected to the Sewer System on which the user is located. The use occurring on the parcel of real property or lot determines the rate category for the purpose of establishing the appropriate rate of the sewer service charge.
D. Rate Categories. The following rate categories for various users connected to the Sewer System, based upon the actual use of the parcel of real property or lot 05/26/2026
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ORDINANCE NO. 2026-
BUENA SANITATION DISTRICT
connected
to the Sewer System, are hereby established.
A. Residential/Single-Family
The Residential/Single-Family rate category shall include the following uses:
(1) Each parcel of real property or lot having a distinct assessor's parcel number on which a separate single-family dwelling unit is constructed and used for residential purposes.
(2) Each individually owned or controlled dwelling unit having a distinct assessor's parcel number within a condominium or cooperative ownership development.
The sewer service charge for each single-family dwelling unit located on any parcel of real property or lot containing one or more single-family structures in the Residential/Single- Family rate category shall consist of a Fixed Rate for each Fiscal Year identified in the Rate Table below .
B. Residential/Multi-Family
The Residential/Multi-Family rate category shall include the following uses:
(1) Every parcel of real property or lot having a distinct assessor's parcel number on which multiple-dwelling units are constructed and used for residential purposes. Each living unit available for residential occupancy shall be considered a separate dwelling unit.
(2) Every mobile home park on which factory
assembled or mobile homes are located and used for residential purposes. Each available space shall be considered as a separate dwelling unit.
The sewer service charge for each dwelling unit located on any parcel of real property or lot in the Residential/Multi-Family rate category shall consist of the Fixed Rate for each Fiscal Year identified in the Rate Table below .
C. Industrial/Commercial
The
Industrial/Commercial rate category shall include each and every parcel of real property or lot used for any purpose other than residential use and which is connected to the Sewer System. This category includes, without limitation :
(1) Any and all commercial uses such as
retail, office and professional, or commercial products distribution, warehousing and storage facilities.
(2) Any and all industrial uses such as manufacture or
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ORDINANCE NO. 2026-
BUENA SANITATION DISTRICT
assembly
plant, food processing facilities, or industrial products distribution, storage or warehousing facilities .
(3) Any and all governmental uses such as schools,
hospitals, office buildings, distribution, maintenance or storage facilities . (4) All other uses not included in (1) through (3) above .
For each such use the sewer service charge upon the parcel shall include the Fixed Rate and the Strength Flow Rate for each Fiscal Year identified in the Rate Table below. The Strength Flow Rate categories of High, Medium or Low for each parcel shall be determined in accordance with the recommendations of the Revenue Program Guidelines. The Strength Flow Rate shall be a variable amount based upon the Strength and the actual or imputed aggregate water consumption of the parcel measured in HCF reported by the municipal water supplier for the entire calendar year immediately preceding the fiscal year in which the Strength Rate is applied.
E. Rates. Rates for the sewer service charge imposed upon each parcel of real property or lot having a connection to the Sewer System according to the respective Rate Category, are hereby fixed and established, for each of the Fiscal Years identified, as presented in the Rate Table below.
BUENA SANITATION DISTRICT: SEWER SERVICE RATES
City Limits Unit/yr.
County/San Marcos Unit/yr .
Unit/yr.
Unit/yr.
CUSTOMER CURRENT FY FY FY
CLASS RATES 2026-
2027
2027-
2028
2028-
2029
Residential
SINGLE-FAMILY
Per $663 $716 $745 $775
Per $621 $650 $676 $704
MULTI-FAMILY
City Limits Per $463 $501 $522 $543
County/San Marcos Per $434 $455 $474 $493
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ORDINANCE NO. 2026-
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Industrial/Commercial
FIXED PORTION
City Limits per EDU
owned $200 $186 $194 $202
County/San
Marcos
per EDU
owned $ $120 $125 $130
STRENGTH PORTION
Low Strength
City Limits per HCF $5.83 $5.25 $5.46 $5.68
County/San
Marcos
per HCF $5.83 $5.25 $5.46 $5.68
Medium Strength
City Limits per HCF $6.68 $6.53 $6.80 $7.08
County/San
Marcos
per HCF $6.68 $6.53 $6.80 $7.08
High Strength
City Limits per HCF $9.21 $10.98 $11.42 $11.88
County/San
Marcos
per HCF $9.21 $10.98 $11.42 $11.88
CAPACITY RENTAL
CHARGE6
City Limits
Per
Excess
EDU $506 $613 $613 $613
Used
County/San
Marcos
Per
Exces
s EDU $464 $613 $613 $613
Used
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ORDINANCE NO. 2026-
BUENA SANITATION DISTRICT
F. Findings. The Board of Directors has conducted all proceedings required to set sewer service charges under Article XIII D of the California Constitution.
G. Publication; no codification. Following the adoption of this ordinance the Clerk of the Board shall cause this ordinance or a summary of it to be published in a newspaper of general circulation within the Buena Sanitation District in the manner required by law. This ordinance shall not be codified.
H. Transmission to San Diego County Tax Collector. The Clerk of the Board is directed to transmit the Report to the San Diego County Tax Collector and to the annually file the necessary documents with the Tax Collector such that the sewer service changes for Fiscal Years 2026/27 through 2028/29, as set forth in the Report, will be included on the San Diego County Property Tax Roll.
I. Effective Date. This ordinance shall be in full force and effect the 31st day following the date of its adoption.
J. Adoption. INTRODUCED and ADOPTED at a regular meeting of Buena Sanitation District on May 26, 2026, by the following vote:
AYES:
NOES:
ABSTAIN:
By
:________________________________
JOHN FRANKLIN, CHAIRPERSON
APPROVED AS TO FORM: ATTEST:
WALTER CHUNG, DISTRICT COUNSEL KATHY VALDEZ, CLERK OF THE BOARD By:______________________________ By:_________________________________
APPROVED
Walter C. Chung
20260518092536
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EXHIBIT 10
05/26/2026
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EXHIBIT 11
EXHIBIT 12
Report of Vista Sewer Assessment for FY 2026/27
On file in the Office of the City Clerk
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EXHIBIT 12
EXHIBIT 13
Report of Buena Sanitation District Sewer Assessment for FY 2026/27 On file in the Office of the City Clerk
05/26/2026
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EXHIBIT 13
PRIOR ACTIONS
SEWER SERVICE CHARGES
On Nov
ember 14, 2017, adopted City Ordinance No. 2017-19, establishing rates for sewer service charges for the Vista Sewer System (Vote: 5-0).
On Nov
ember 14, 2017, adopted Buena Sanitation District Ordinance 2017-1, establishing rates for sewer service charges for the Buena Sewer System (Vote: 5-0).
On Febr
uary 10, 2026, directed staff to finalize the cost of service rate study report using the proposed rate increase of 5.5% for City of Vista and 4.0% for Buena Sanitation District customers for Fiscal Years 2026/27 thru 2028/29 (Vote: 5-0).
On Febr
uary 10, 2026, adopted City Council Resolution No. 2026-26, approving collection of all future fiscal year sewer service charges on the San Diego County Property Tax Roll (Vote: 5-0).
On Febr
uary 10, 2026, adopted Buena Sanitation District Resolution No. 2026-2, approving collection of all future fiscal year sewer service charges on the San Diego County Property Tax Roll (Vote: 5-0).
On M
arch 24, 2026, City Council received and filed the City of Vista Wastewater Rate Study from Water Resources Economics (Vote: 5-0).
On M
arch 24, 2026, Buena Sanitation District Board of Directors received and filed the Buena Sanitation District Wastewater Rate Study from Water Resources Economics (Vote: 5-0). 05/26/2026
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EXHIBIT 14