2019.11.04 CC Packet - Laserfiche WebLink

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2020 Water and Sewer Rates Memo AVERAGE QUARTERLY USAGE LEVELS AND PRICE POINTS Water rates have been crafted around the quarterly residential usage levels from 2017 and 2018. These usage levels and rates are as follows: Average Winter Usage: 11,648 gallons First 11,000 gallons billed at $1.00 per thousand gallons Average Spring Usage: 20,635 gallons Next 9,000 gallons billed at $2.00 per thousand gallons Average Summer Usage: 29,438 gallons Next 9,000 gallons billed at $3.00 per thousand gallons Average Fall Usage: 12,101 gallons Over 29,000 gallons billed at $4.88 per thousand gallons The base charge will increase from $31 per quarter to $34. This revenue will offset annual depreciation and allows us to keep lower usage rates for low -end water users. TRUE CONSERVATION RATES A true conservation rate schedule seeks to reward low -end users with the lowest rate while encouraging everyone to use water efficiently. The recommended water rate schedule will allow for the recapture of all operating and depreciation expenses. With the recommended rate schedule, all 3,320 residential accounts will experience an annual increase of $12 in their water bills due to the increase in the quarterly base charge. Of course, their quarterly bills will fluctuate based on water usage. MULTI -FAMILY RESIDENTIAL RATES The City has 187 Multi -Family accounts that contain 1,301 dwelling units. Prior to 2018 these accounts were billed the same as single-family residential accounts. But my analysis shows that these accounts use 45% less water since their irrigation is metered separately (and billed at the highest rate). Staff is recommending retaining just one rate level - $2.00 per thousand gallons. With the recommended rate schedule, multi -family accounts will see an annual increase of $12 in their water bills due to the increase in the quarterly base charge. COMMERCIAL AND INDUSTRIAL RATES The only change is in the higher base charge for depreciation. The 101 accounts in this category will only experience a $3 increase per quarter. SANITARY SEWER RATES The largest expense item in the sewer department is for sewage treatment. These charges are imposed by and paid to MCES. For 2020, MCES charges will amount to $630,280, an increase of $71,749 or 12.79%. When combined with depreciation and funds for lift -station rebuilds, staff is recommending an increase in the SAC portion of the rate schedule. The amount charged for flow (metered water use) will remain the same. Also, residential sewer charges will continue to be based on water used in the winter quarter (January, February, and March). For residential customers, the amount per SAC unit will increase from $60 per quarter to $61. All other customers will also see an increase of $1 per SAC unit per quarter.