HomeMy WebLinkAbout5 Water Rate increase Agenda Item # ,
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Memorandum
To: Board of Directors
From: Peter Holzmeister
Date: June 30, 2006
Subject: Water Rate Increase public hearing
Why this matter is before the Board: This matter involves holding a public
hearing prior to adopting an ordinance increasing the District's water rates by Six
percent in 2007 and 2008. The board conducts this hearing.
History: We have been discussing this matter at Board meetings so I will not
spend time here going over the details. In addition, staff will be making a
presentation of the development of this issue at the meeting.
New Information: A public hearing has been advertised in the Sierra Sun and on
the District's website. Notices were posted in the Nevada County Library and the
Post Office, as well as emailed to interested parties and associations for
distribution within the groups. Notice of this public hearing was also announced
on the local KTKE Truckee Radio Station over the past weekend.
Staff prepared a FAQ sheet addressing this water rate increase, a copy of which
is attached. It was posted on the website and available to the public upon
request.
Recommendation: At the conclusion of the public hearing you will not be taking
any action. The adoption of this ordinance will be addressed at the Special
meeting held July 12, 2006.
Water Rate Increase
Frequently Asked Questions
Q: How much will the water rate increase?
A: The proposal is to increase water rates by six percent each year for two years.
Q: When will the increase occur?
A: The first six percent increase would occur on January 1, 2007 and the second six
percent increase would occur on January 1, 2008
Q: How much will the monthly water bill go up?
A: The average TDPUD water customer would see a monthly increase of$3.22 on
January 1, 2007 and an increase of$3,42 on January 1, 2008, Some customers would
see an increase of a little less and some would see an increase of a little more.
Q: Why is the rate increasing?
A: TDPUD needs to replace older leaking water lines in various neighborhoods of
Truckee. To pay for that work we are proposing to borrow money and repay the loan
over thirty years. In order to borrow the money the investors need to see that the
TDPUD water fund is in a sound financial position. Bankers need to see that our water
rates are sufficient to sustain a reasonable cash reserve and cover increasing operating
costs. The purpose of the rate increase is to do exactly that: establish a reasonable
cash reserve and cover projected increases in operating costs.
Q: How much cash does the TDPUD water fund have in unrestricted funds right now?
A: We have no cash in unrestricted reserves right now.
Q: Why is the TDPUD spending so much money on pipeline replacement?
A: We are experiencing leaks in the pipeline system in various areas of the District. We
are spending too much time and money performing temporary repairs on pipelines that
need to be replaced. Repetitively performing temporary repairs to small sections of
pipeline is more expensive than replacing the pipeline. Also, leaking water lines waste
water that costs money to pump. Leaking water lines can cause road damage and can
result in icy conditions on roads during cold weather. For all of these reasons we need
to replace the leaking water lines.
Q: Why is the TDPUD building a cash reserve?
A: Prudent business practice requires that TDPUD maintain unrestricted cash reserves
equal to approximately 170 days of operating expenses. The cash reserves are
intended to provide a financial safety net. The cash reserve allows us to deal with
unforeseen matters without impacting our ability to pay normal water system expenses.
This is similar to a "rainy day"savings account you may have for your unforeseen
household expenses.
Q: How much cash does the District plan to accumulate in the reserve?
A: Our goal is to accumulate $3,000,000 over the next six years.
Q: Why is the TDPUD incurring long-term debt to replace water pipelines?
A: Pipeline construction is expensive. The cost is currently approximately$1.1 million
per mile. We plan to spend$12.3 million during the next four years. This debt that we
propose to secure will raise that$12.3 million. By using debt that is repaid over the next
thirty years, the people who live in Truckee during that future thirty years and who are
served water from that new pipeline will be the people who pay for it. We believe that it
is important to make sure our water system is sound both now and in the future.
Q: Is the new debt solely for the purpose of replacing leaking water lines?
A: No. A portion of the new debt will refund existing debt if we can get a lower interest
rate than we are currently paying. Another portion of the new debt pays for the new
pipeline being constructed along Brockway Road(and repaid with developer fees rather
than rates) and a portion pays for Donner Lake water system reconstruction (paid for by
Donner Lake customers through a separate billing surcharge)
Water Rate Increase 6%
Residential Water Rates Current Jan. 1. 2007 Jan. 1. 2008
Zone 1 $ 48.47 $ 51.38 $ 54.46
Zone 2 $ 50.80 $ 53.85 $ 57.08
Zone 3 $ 51.88 $ 54.99
Zone 4 $ 53.05 $ 58 29
$ 56.23 $ 59.60
Zone 5 $ 53.74 $ 56.96 $ 60.38
Zone 6 $ 54.18 $ 57.43
$ 60.88
Zone 7 $ 56.87 $ 60.28 $ 63.90
Zone 8 $ 58.58 $ 62.09
$ 65.82
Zone 9 $ 59.24 $ 62.80 $ 66.56
Zone 10 $ 62.92 $ 66.69 $ 70.69
Zone 11 $ 66.43 $ 70.42 $ 74.64
Commercial Water Rates
Size service/gallons per month Allowance
3/4" / 6,000 $ 40.03 $ 42.43 $ 44.97
1" / 11,000 $ 47.74 $ 50.61 $ 53.64
1-1/4" / 17,000 $ 57.47 $ 60.91 $ 64.57
1-1/2" / 24,000 $ 67.12 $ 71.14 $ 75.41
2" ! 43,000 $ 92.25 $ 97.79 $ 103.66
3" / 96,000 $ 154.44 $ 163.71 $ 173.53
4" / 171,000 $ 220.98 $ 234.24 $ 248.30
Water used above monthly Allowance
1 to 16,000 gallons- per 1,000 $ 1.79 $ 1.89 $ 2.01
16,000 to 56,000 gallons- per 1,000 $ 1.41 $ 1.49 $ 1.58
56,000 to - 96,000 gallons- per 1,000 $ 1.12 $ 1.19 $ 1.26
96,000 and above- per 1,000 $ 0.91 $ 0.97 $ 1.03
Zone Charges per 1,000 gallons
Zone 1 $ 0.312 $ 0.33 $ 0.35
Zone 2 $ 0.572 $ 0.61
$ 0.64
Zone 3 $ 0.715 $ 0.76 $ 0.80
Zone 4 $ 0.859 $ 0.91 $ 0.97
Zone 5 $ 0.928 $ 0.98 $ 1.04
Zone 6 $ 1.002 $ 1.06 $ 1.13
Zone 7 $ 1.322 $ 1.40
Zone 8 $ 1.505 $ 1.49
$ 1.59 $ 1.69
Zone 9 $ 1.579 $ 1.67 $ 1.77
Zone 10 $ 2.011 $ 2.13 $ 2.26
Zone 11 $ 2.433 $ 2.58 $ 2.73
Small Residential Unit(under 300SF)
Zone 1 $ 3526 $ 37.37 $ 39.62
Zone 2 $ 37.59 $ 39.85 $ 42.24
Zone 3 $ 38.67 $ 40.99 $ 43.45
Zone 4 $ 39.85 $ 42.24 $ 44.77
Zone 5 $ 40.53 $ 42.96 $ 45.54
Zone 6 $ 40.97 $ 43.43
$ 46.04
Zone 7
$ 43.66 $ 46.28 $ 49.06
Zone 8 $ 44.27 $ 46.92 $ 49.74
Zone 9 $ 46.03 $ 48.79 $ 51.72
Zone 10 $ 49.71 $ 52.69 $ 55.85
Zone 11 $ 55.43 $ 58.76 $ 62.28
6/1/2006
w � r
i -E D E.
Publicis
District
Ordinance No. 2006 - XX
AMENDING THE WATER MONTHLY RETAIL RATES
WHEREAS the District is engaged in construction of various water system capital projects
during the next five years; and
WHEREAS to provide funds for this water capital program the District intends to secure long-
term financing through issuance of Certificates of Participation; and
WHEREAS an analyses of the District's financial status demonstrates that it does not have an
adequate cash reserve; and
WHEREAS the financial markets look for financial strength in a water utility as a condition for
lending money; and
WHEREAS the Board has been advised that a six percent water rate increase implemented on
January 1, 2007 and again on January 1, 2008 would provide a revenue stream to establish a
cash reserve and cover increasing operating costs: and
WHEREAS, on July 5, 2006 a public hearing was held to receive comments from the public
concerning a proposal to adopt such rate increases;
NOW, THEREFORE, BE IT ENACTED by the Board of Directors of the Truckee Donner Public
Utility District as follows:
Section 1. Effective January 1, 2007 following monthly water rates shall be effective.
Residential Water Rates - The Domestic Water Rates for single family homes, individual
condominium units and townhouse units shall relate to the pressure zone in which said
service is located. The Domestic Flat Rate Base for all zones shall be the fixed monthly
rate of $48.57. The appropriate zonal pumping costs shall be added to the base monthly
rate yielding the appropriate flat zonal rates as follows:
Zone Charge
Zone 1 51.38
Zone 2 53.85
Zone 3 54.99
Zone 4 56.23
Zone 5 56.96
Zone 6 57.43
Zone 7 60.28
Zone 8 62.09
Zone 9 62.80
Zone 10 66.69
Zone 11 70.42
Ordinance 2006-XX 1
Commercial Water Rates - The following Commercial Rates shall apply to all duplex and
other multiple dwelling units, trailer parks, and other commercial establishments:
$12e Gallons Per
Service Month Water Rate
Allowance
3/4" 6,000 42.43
1" 11,000 50.61
11/4" 17,000 60.91
11/2" 24,000 71.14
2" 43,000 97.79
3" 96,000 163.71
4" 171,000 234.24
Water used in any month above the allowance will be charged as follows:
Gallons Charge
0 to 16,000 gallons 1.89/1,000
16,000 - 56,000 gallons 1.49/1,000
56,000 - 96,000 gallons 1.19/1,000
96,000 and above .97/1,000
The following Zone Charge per 1,000 gallons shall be added for all water used:
Zone Charge
Zone 1 $ .33
Zone 2 .61
Zone 3 .76
Zone 4 .91
Zone 5 .98
Zone 6 1.06
Zone 7 1.40
Zone 8 1.59
Zone 9 1.67
Zone 10 2.13
Zone 11 2.58
Until meters are installed, the Commercial Flat Rate shall be based on the foregoing
allowance, and the Zone Charge shall be levied against the maximum number of
gallons in said allowance.
Ordinance 2006-XX 2
Small Residential Unit Rate - Domestic water rates for single family homes, individual
condominium units and townhouses units under 300 square feet with no provisions for
washer/dryer, dishwasher or outside hose bib, no improved landscaping needing water
other than that provided by nature, no leaking plumbing fixtures as determined by District
staff. The Domestic Flat Rate Base for all zones shall be the fixed amount of $34.57. The
appropriate zonal pumping costs shall be added to the base monthly rate yielding the
appropriate flat zonal rates as follows:
Zone Rate
Zone 1 $37.37
Zone 2 39.85
Zone 3 40.99
Zone 4 42.24
Zone 5 42.96
Zone 6 43.43
Zone 7 46.28
Zone 8 46,92
Zone 9 48.79
Zone 10 52.69
Zone 11 58.76
Section 2. Effective January 1, 2008 following monthly water rates shall be effective.
Residential Water Rates - The Domestic Water Rates for single family homes, individual
condominium units and townhouse units shall relate to the pressure zone in which said
service is located. The Domestic Flat Rate Base for all zones shall be the fixed monthly
rate of $51.48. The appropriate zonal pumping costs shall be added to the base monthly
rate yielding the appropriate flat zonal rates as follows:
Zone Charge
Zone 1 54.46
Zone 2 57.08
Zone 3 58.29
Zone 4 59.60
Zone 5 60.38
Zone 6 60.88
Zone 7 63.90
Zone 8 65.82
Zone 9 66,56
Zone 10 70.69
Zone 11 74.64
Ordinance 2006-XX 3
Commercial Water Rates - The following Commercial Rates shall apply to all duplex and
other multiple dwelling units, trailer parks, and other commercial establishments:
Size Gallons Per
Service Month Water Rate
Allowance
3/4" 6,000 44.97
1" 11,000 53.64
11/4" 17,000 64.57
11/2" 24,000 75.41
2" 43,000 103.66
3" 96,000 173.53
4" 171,000 248.30
Water used in any month above the allowance will be charged as follows:
Gallons Charge
0 to 16,000 gallons 2.01/1,000
16,000 - 56,000 gallons 1.58/1,000
56,000 - 96,000 gallons 1.26/1,000
96,000 and above 1.03/1,000
The following Zone Charge per 1,000 gallons shall be added for all water used:
Zone Charge
Zone 1 $ .35
Zone 2 .64
Zone 3 .80
Zone 4 .97
Zone 5 1.04
Zone 6 1.13
Zone 7 1.49
Zone 8 1.69
Zone 9 1.77
Zone 10 2.26
Zone 11 2.73
Until meters are installed, the Commercial Flat Rate shall be based on the foregoing
allowance, and the Zone Charge shall be levied against the maximum number of
gallons in said allowance.
Ordinance 2006-XX 4
Small Residential Unit Rate - Domestic water rates for single family homes, individual
condominium units and townhouses units under 300 square feet with no provisions for
washer/dryer, dishwasher or outside hose bib, no improved landscaping needing water
other than that provided by nature, no leaking plumbing fixtures as determined by District
staff. The Domestic Flat Rate Base for all zones shall be the fixed amount of $36.54, The
appropriate zonal pumping costs shall be added to the base monthly rate yielding the
appropriate flat zonal rates as follows:
Zone Rate
Zone 1 $39.62
Zone 2 42.24
Zone 3 43.45
Zone 4 44.77
Zone 5 45.54
Zone 6 46.04
Zone 7 49.06
Zone 8 46.74
Zone 9 51.72
Zone 10 55.85
Zone 11 62.28
Section 3. If no protest is made pursuant to Public Utilities Code Section 16078, then the terms
of this ordinance shall be effective thirty days after adoption by the board of directors of the
District.
Section 4. The Clerk of the District shall immediately cause a copy of this ordinance to be
published in a newspaper of general circulation and posted in three places within the District.
Section 5. The provisions of other Ordinances shall remain in effect to the extent that they do
not conflict with this ordinance.
PASSED AND ADOPTED by the Board of Directors of the Truckee Donner Public Utility District
at a meeting duly called and held within the District on the _ day of 2006 by the
following roll call vote:
AYES:
NOES:
ABSENT:
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
By
J. Ron Hemig, President of the Board
ATTEST:
Peter L. Hoizmeister, Clerk of the Board
Ordinance 2006-XX 5
E°
Robert A. and Barbara S. Morrey
3404 Merrimac Drive
San Jose, California 95117-3624
408-379-5944
June 14, 2006
Second home:
12860 Boca Street
Truckee, California
Board of Directors
Truckee Donner Public Utility District
P.O. Box 309
Truckee, California 96160-0309
Honorable members of the Board of Directors:
My wife and I have owned our second home in the Biltz Tract since the early 1970's. We
are extremely concerned about the high cost of water in your district and we understand
that you are planning another raise in rates of 12% over the next two years. As second
home owners we use relatively little water during our 30-40 days a year that we stay in
the house. We do not have a clothes washer, a dishwasher, or a garden and we pay the
same flat rate of$50 per month as the full-time residents. This rate is about twice the
monthly average of$26 that we pay in our primary home in San Jose where the weather
is warmer and we use water for all of the above listed items as well as other in-home
usage. In San Jose our water charge is based on the amount of water we use as measured
by our water meter. As you know the number of second homes is far greater than the full-
time occupied homes. We feel that it is very unfair that those who use very little water
subsidize those who use a lot of water within our rate classification.
We request that you have water meters installed on all properties in your district so that
each of us may pay his/her fair share of the water that he/she actually uses.
Please make the installation of water meters an item for discussion at the upcoming
meeting and let us know the outcome of this meeting.
Thank you,
Dr. Robert A. Morrey and Barbara-&. Morrey
Tahoe Donner PUD June 30, 20C'6
To board of Directors and Manager,
I believe that the charge for irrigation meters when no water is being used is excessive. I
live at Riverview Townhomes and each unit pays a flat fee of$51.55 for the household
water use. Then. we pay for 3 water meters for the irrigation.
If one owns an individual home, they can use excessive amounts of water for irrigation
and household use. The monthly flat rates that you charge range from $49.64 to $67.18,
This equates to a range of approximately $650 to $806 for one year.
Each meter costs the homeowners association $49.64 per month per meter when no water
(winter months) is being used and then$49.64 plus the costs of water for the actual
summer when water is used. . 'That would equate to approximately of$744.6 per 5
months when no water is used. I would like you all to review and correct this high
charge.. It is excessive_ Especially when you charge individual homes a flat rate for both
household and irrigation use_
Also, we pay for the water in the summer months at that $49.64 rate plus the water. I
understand it is at a cheaper rate when more is used which doesn't make sense. The
rates for each higher tier of usage should cost more per gallon than less.. This would
encourage conservation. Why is this? I would really like to know.
We even get a minimal charge of$10.32(winter)when no electricity is being used. We
have 3 electrical units which only operate the 3 automatic sprinkler systems_
Until we get water meters, I think that condo owners and apartment owners should not be
penalized with excessive water charges.
Hope to see this discussed and changed to reflect an equitable charge,
If you have any questions, please call me at 550-8886.
Regards,
Diana Pruski I
10096- D Nicolas Dr. 0
Truckee, CA 96161