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HomeMy WebLinkAbout7-Conduct a Public Hearing on Proposed Water RatesAgenda Item #7 To: From: Date: Subject: Board of Directors Robert Mescher January 15, 2014 Conduct a Public Hearing on Proposed Water Rates PUBLIC HEARING 1. WHY THIS MATTER IS BEFORE THE BOARD This matter involves a public hearing prior to the consideration of adopting an ordinance increasing water rates. The Board conducts this hearing. 2. HISTORY California's Proposition 218 was adopted in 1996 and became effective in 1997. It is also known as the "Right to Vote on Taxes Act." The adoption of new water rates is subject to the requirements of Proposition 218. The main requirements are: Rates must be based on actual cost of service; District must mail a notice to all rate payers and may mail a notice to property owners of the proposed change in rates; District must hold a public hearing at least 45 days after the mailing of the notices; Proposed change in rates is considered rejected if written protests are received from a majority of the affected property owners; or Rates can become effective 30 days after the public hearing and adoption of an ordinance. The District's water rates have not been increased since FY11. The approved FY14 and FY15 Budget and the ten-year Financial Master Plan require water revenue to increase by 3% in FY14 and 3% in FY15 to achieve the District's short-term and long-term goals. The District hired HDR to conduct a water rate study and HDR completed that study. At the November 6, 2013 Board Meeting, Shawn Koorn presented the study (Attachment 1 of tonight's Agenda Item 13) and discussed several rate structure options to achieve the revenue requirements of the approved FY14 and FY15 Budget. The Board approved a rate structure (subject to a public hearing scheduled on January 15, 2014) that spread the increases evenly across both fixed and variable charges, and a draft ordinance was accepted by the Board (Attachment 2 of tonight's Agenda Item 13). Robert Mescher Michael D. Holley Administrative Services Manager General Manager Therefore the following schedule was developed for implementation of new rates in FY14 and FY15: November 6 Presented an updated water rate study Approved the water rate increase subject to a public hearing November 26 Mailed notices to customers and parcel owners of proposed rates and of public hearing December Published a notice of a public hearing in the local newspaper January 15 (tonight) Hold a public hearing regarding proposed water rates Consider adoption of an ordinance for the new water rates February 15 (or after) New rates can become effective 3. NEW INFORMATION The remaining steps to complete the requirements of Proposition 218 and the District's policies regarding adoption of an ordinance are: Hold the public hearing on increasing water rates for FY14 and FY15 (tonight) Consider the Public Comments; as of January 10, five written protests (Attachment 1) were received by the District. Consider adopting the water rate increase ordinance (tonight - Agenda Item 13) 5. RECOMMENDATION Conduct the public hearing. 4. FISCAL IMPACT There is no fiscal impact with this agenda item.