[1. Call to Order NOTICE OF OPTION TO RECESS INTO EXECUTIVE SESSION Pursuant to A.R.S. §38-431.02, notice is hereby given to the members of the City Council and to the general public that, at this work session, the City Council may vote to go into executive session, which will not be open to the public, for discussion and consultation with the City’s attorneys for legal advice on any item listed on the following agenda, pursuant to A.R.S. §38-431.03(A)(3).]
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THAT MEMBERS OF THE CITY COUNCIL MAY VOTE TO GO INTO EXECUTIVE SESSION, WHICH WILL NOT BE OPEN TO THE PUBLIC FOR DISCUSSION AND CONSULTATION WITH THE CITY'S ATTORNEYS FOR LEGAL ADVICE ON ANY ITEM LISTED ON THE FOLLOWING AGENDA.
CAN WE HAVE ROLL CALL? MAYOR DAGGETT HERE.
COUNCIL MEMBER MATTHEWS [INAUDIBLE].
OH, THANK YOU, COUNCIL MEMBER MCCARTHY HERE.
OKAY. COUNCIL MEMBER MCCARTHY, WOULD YOU LEAD US IN THE PLEDGE OF ALLEGIANCE? I WILL PLEASE STAND IF YOU'RE ABLE.
I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA AND TO THE REPUBLIC FOR WHICH IT STANDS, ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.
THE MISSION OF THE CITY OF FLAGSTAFF IS TO PROTECT AND ENHANCE THE QUALITY OF LIFE FOR ALL.
COUNCIL MEMBER SWEET THE LAND ACKNOWLEDGMENT.
THESE LANDS, STILL INHABITED BY NATIVE DESCENDANTS, BORDER MOUNTAIN SACRED TO INDIGENOUS PEOPLES.
WE HONOR THEM, THEIR LEGACIES, THEIR TRADITIONS, AND THEIR CONTINUED CONTRIBUTIONS.
WE CELEBRATE THEIR PAST, PRESENT AND FUTURE GENERATIONS WHO WILL FOREVER KNOW THIS PLACE AS HOME.
SO BEFORE WE LAUNCH INTO OUR WORKSHOP HERE FOR THOSE ONLINE IN OUR MEETING, IF YOU WOULD PUT A C OR A Q IN THE CHAT TO INDICATE THAT YOU HAVE A QUESTION OR A COMMENT, I WILL CALL ON YOU AND NOW STAFF.
[4. Wastewater Rate Design Alternatives Workshop Receive guidance on which wastewater rate option is preferred by City Council and Water Commission.]
AMAZE US WITH YOUR PRESENTATION.GOOD AFTERNOON, MAYOR AND MEMBERS OF COUNCIL AND WATER COMMISSIONERS.
MY NAME IS CAROL MOLESKY FROM STANTEC, AND YOU'VE HEARD A LOT FROM ME IN THE PAST FEW MONTHS.
AND TODAY WE'RE GOING TO GET DOWN TO SOME INTERESTING DISCUSSIONS ON WASTEWATER RATE DESIGN.
WE'RE GOING TO GO OVER COST RECOVERY FOR FISCAL YEAR 2025.
SO WHEN WHAT WE TALK ABOUT TODAY AFFECTS THE NEXT 4 TO 5 YEARS ALSO.
WE'RE GOING TO TALK ABOUT THREE WASTEWATER RATE OPTIONS.
WE'RE GOING TO ASK YOU FOR YOUR OPINIONS ON THEM.
AND WE'D LOVE IT IF YOU'D GIVE US DIRECTION ON WHICH ONE YOU PREFER.
BUT WE LIKE TO HEAR WHAT YOU THINK TODAY.
THE MOST IMPORTANT THING THAT YOU PROBABLY WANT TO SEE IS HOW IS THIS GOING TO IMPACT OUR CUSTOMERS? WE'LL TALK A LOT ABOUT THAT AT THE END OF THE PRESENTATION, AND THEN WE'LL TALK ABOUT NEXT STEPS.
SO IF YOU'RE READY HERE WE GO.
YOU'VE SEEN THIS A MILLION TIMES.
THIS IS THE TASK OF THE RATE STUDY.
STANTEC WAS TASKED WITH FOLLOWING THROUGH WITH THE TYPICAL STEPS OF A RATE STUDY.
AND WE ARE HERE THE RATE DESIGN.
WE'D SPLIT THE WATER RATE DESIGN DISCUSSION SEPARATELY FROM THE WASTEWATER RATE DESIGN.
THE FIRST QUESTION IS HOW MUCH DOES THE CITY OF FLAGSTAFF NEED TO RECOVER FOR WATER, RECLAIMED WATER AND WASTEWATER SERVICES? THAT CAME THROUGH THAT FINANCIAL PLANNING TASK, THAT WAS OUR FIRST TASK THAT WE COMPLETED.
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YOU GAVE US DIRECTION FOR FUNDING THE FULL CAPITAL IMPROVEMENT PROGRAM.THE SECOND QUESTION IS FROM WHOM DO WE GET THIS COST RECOVERY? SO WHO DO WE SEND OUT OUR BILLS TO? THE COST OF SERVICE ALLOCATIONS AND THE COST OF SERVICE TASK ANSWERS THAT QUESTION.
AND THOSE SOME OF YOU MAY BE FAMILIAR WITH THE RATE MANUALS THAT ARE RELEASED BY THOSE PUBLICATIONS.
SO WE FOLLOW THAT STEP BY STEP PROCESS TO DETERMINE THE COST OF SERVICE BY CLASS.
PART OF THAT WAS THE CAPACITY FEES.
THAT HELPS WITH THE COSTS OF SERVICE FOR ALL OF THESE SERVICES AND COSTS.
HOW TO COLLECT THE COSTS OF SERVICE.
WE'RE GOING TO LOOK AT HOW WE TRANSLATE THAT INTO RATE DESIGN OPTIONS.
WE HAVEN'T ACTUALLY BROKEN DOWN THE ACTUAL REVENUE REQUIREMENTS YET FOR YOU.
WE'VE PUT THEM INTO THAT LONG TERM FINANCIAL PLAN.
SO I WANTED TO FOCUS THIS IN ON FISCAL YEAR 2025 FOR THE WASTEWATER FUND.
SO THESE ARE CASH FUNDED CAPITAL EXPENDITURES.
SO IN FISCAL YEAR 2024 ARE $19.2 MILLION.
FLASH FORWARD TO 2025 AND THE BUDGET IS INDICATING $17.3 MILLION.
YOU CAN SEE THAT WAY THOSE EACH OF THOSE COSTS BREAK DOWN.
THE USE OF RESERVES IS AN IMPORTANT OFFSET TO THOSE REVENUE REQUIREMENTS.
SO WE KNOW THAT THERE ARE RESERVES THAT HAVE BEEN BUILT UP FROM PRIOR RATE REVENUES.
AND SOME OF THESE, SOME OF THESE GRANTS THAT MIGHT BE AVAILABLE.
SO THE USE OF RESERVES HELPS OFFSET THAT REVENUE REQUIREMENT AS WELL AS THE NON RATE REVENUES.
SO WE END UP WITH OUR RATE REVENUE REQUIREMENT.
THIS YEAR, YOU'RE INTENDING TO COLLECT $10.6 MILLION FROM YOUR WASTEWATER RATE REVENUES.
FOR FISCAL YEAR 25 THAT NEEDS TO BE $13 MILLION.
THAT'S A ROUNDED NUMBER, BUT IT'S $13 MILLION.
BACK WHEN WE TALKED TO YOU ABOUT THE RATE PLAN.
SO THE SERIES OF RATE INCREASES NEEDED FOR THE NEXT FIVE YEARS, WE WERE TELLING YOU THAT IT WAS 25%.
THAT IS TRUE, THAT RATES NEED TO INCREASE BY 25% TO GET 22% INCREASE IN RATE REVENUES.
THAT'S BECAUSE WE'RE LOOKING AT THE EFFECTIVE DATE OF YOUR RATE INCREASE AT SEPTEMBER 1 OF 2024.
SO THAT'S NOT A FULL 12 MONTHS OF RATE REVENUE.
SO WE HAVE TO RECOVER A FULL 12 MONTHS OVER NINE MONTHS OF RATE REVENUE INCREASES.
THAT'S WHERE WE GET THE 22% IN CASE YOU'VE DONE THE MATH.
THERE'S GOING TO BE A LOT MORE MATH.
WHEN WE TAKE THAT REVENUE REQUIREMENT AND WE JUST LOOK AT IT IN TOTAL, I TOLD YOU THERE WAS $10.6 MILLION EXPECTED FROM WASTEWATER RATE REVENUES THIS YEAR, AND IN 2025, IT'S $13 MILLION.
SO THE NEXT SET OF GRAPHS ARE GOING TO SHOW THE CURRENT REVENUE ESTIMATES IN THE BLACK BAR AND THE PROJECTED 2025 REVENUE AND COST OF SERVICE REVENUE IN THE ORANGE BAR.
THIS IS A $2.33 MILLION INCREASE, IT'S A 22% CHANGE AS I MENTIONED.
NORMALLY WE SHOW AND YOU MIGHT HAVE SEEN THIS IN YOUR IN YOUR PACKETS THAT WE SHOW ALL OF THE CUSTOMER CLASSES AND WE COMPARE WHAT REVENUE IS EXPECTED IN 2024 VERSUS THE COST TO SERVE THAT CLASS OF CUSTOMERS IN 2025.
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CAR WASHES. SO THESE COST TO SERVE ARE CALCULATED BASED ON THE DOLLARS THAT NEED TO BE RECOVERED AND THE FLOWS AND STRENGTHS OF EACH CUSTOMER CLASS.SO WHEN WE'RE LOOKING AT THIS WHOLE COST OF SERVICE AND COST TO SERVE EACH CLASS, WE SEE THAT CURRENTLY THE PROJECTED RATE REVENUE FOR WASTEWATER FROM RESIDENTIAL CUSTOMERS IS $6.3 MILLION.
THAT NEED IS $8.7 MILLION BASED ON THE COST OF SERVICE ANALYSIS IN 2025.
WHERE THE ORANGE BARS ARE COST OF SERVICE BARS ARE HIGHER THAN THE BLACK BARS.
SO COMMERCIAL CUSTOMERS, RESTAURANTS, INSTITUTIONAL CUSTOMERS.
AND THE ICE CREAM CONE MANUFACTURING CLASSES ALL REQUIRE AN INCREASE IN THEIR COST OF SERVICE.
THE REST OF THE CUSTOMERS SEE A DECREASE.
SO WE TAKE THIS COST OF SERVICE INFORMATION AND WE BASICALLY DO BASIC MATH.
WE CALCULATE WHAT RATE NEEDS TO BE CHARGED TO RECOVER THOSE COSTS OF SERVICE.
I'M GOING TO JUMP TO THE FIRST RATE OPTION.
SO ON THE MOST BASIC LEVEL, WHEN WE TAKE THE COST OF SERVICE INFORMATION.
WE GET THE RESULTS ON THIS TABLE.
THE CURRENT RATE IS IN THAT FIRST COLUMN.
THERE'S AN ASTERISK BECAUSE THESE ARE ONLY INSIDE CITY RATES.
SO YOU KNOW THAT THE OUTSIDE CITY RATES HAVE A 10% MULTIPLIER ADDED ON.
AND THEY STILL WOULD IN THE COST OF SERVICE RESULTS.
SO THE CURRENT RATE COMPARED WITH THE FISCAL YEAR 2025 COST OF SERVICE RESULTS, SHOWS YOU THAT THOSE CLASSES THAT I SHOWED WITH A HIGHER ORANGE BAR, YOU KNOW, SO THE HIGHER COST OF SERVICE BAR FOR NEXT YEAR, THEIR RATE PER 1,000 GALLONS OF WASTEWATER FLOW IS HIGHER THAN THE RATE TODAY.
IF THAT BAR IS LOWER, THEIR RATE IS LOWER.
SO WHAT'S INTERESTING IS THAT YOU HAVE HIGHER RATES AND LOWER RATES.
THE RATES TEND TO DIVERGE FROM THE COST OF SERVICE BY CLASS.
SO HERE WE'RE ALIGNING THE COST TO SERVE EACH OF YOUR WASTEWATER CLASSES.
I'LL KEEP GOING. OH, SORRY, I CAN PAUSE.
SO THE TWO COLUMNS THE TWO RIGHT HAND COLUMNS IN THIS TABLE THEY'RE FIGURED THE SAME WAY, ITS JUST THAT ITS RATIOED UP BASED ON THE ADDED COST THAT WE'RE GOING TO INCUR.
IS THAT CORRECT? MAYOR AND COUNCIL MEMBER MCCARTHY IN A WAY, I WOULDN'T SAY THEY'RE RATIOED UP.
WE TAKE THE DOLLARS THAT WE CALCULATE IN FOR EACH OF THOSE CLASSES AND DIVIDE BY THE FLOWS.
SO IF THEIR DOLLARS ARE MORE AND THEIR FLOWS ARE SLIGHTLY MORE THAN YOU KNOW, IT'S NOT QUITE A RATIO GOING UP, I GUESS I DON'T UNDERSTAND WHERE YOU GOT THESE NUMBERS.
WE'LL TAKE THE $8.7 MILLION FOR RESIDENTIAL CUSTOMERS.
DID YOU GET THE $8 MILLION DOLLARS? I MEAN I UNDERSTAND HOW YOU DIVIDE IT UP, BUT WHERE DID YOU GET THE BASIC NUMBER? I MEAN, WE HAVE WASTEWATER COMING FROM ALL KINDS OF DIFFERENT SOURCES.
HOW SOMEHOW YOU ALLOCATED IT BETWEEN THESE SOURCES.
AND THAT'S WHAT I DON'T UNDERSTAND.
SO ESSENTIALLY, THE TOTAL DOLLARS, THE $13 MILLION IS COMING IS ALLOCATED ACROSS THE DIFFERENT COMPONENTS OF THE SYSTEM. SO THERE ARE TREATMENT COMPONENTS AND THERE ARE COLLECTION COMPONENTS AND ADMINISTRATIVE COMPONENTS.
SO WHEN WE TAKE ALL THE TREATMENT COMPONENTS.
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WASTEWATER UTILITY.AND SO WE WERE ABLE TO DIVIDE THOSE.
HOW DID YOU ALLOCATE BETWEEN, SAY, RESIDENTIAL AND ICE CREAM CONE MANUFACTURERS.
IS IT ON THE BASIS OF FLOW, OR IS IT ON THE BASIS OF BIOLOGICAL OXYGEN DEMAND OR WHAT.
SO IT'S FLOW AND THE STRENGTHS.
WHAT WE KNOW BY THE END OF THE COST ALLOCATION, WE HAVE A BUCKET OF COSTS THAT ARE FLOW RELATED, A BUCKET OF COSTS THAT ARE BIOCHEMICAL, OXYGEN DEMAND RELATED OR BOD.
SO THEN THOSE THOSE DOLLARS ARE PROPORTIONALLY ALLOCATED TO RESIDENTIAL ICE CREAM CONE, CAR WASH BASED ON THOSE CUSTOMER CLASSES PROPORTIONS OF THOSE PARAMETERS.
SO RESIDENTIAL CUSTOMERS HAVE THE LARGEST FLOW AMOUNT.
THEY PICK UP THE LARGEST SHARE OF THE FLOW DOLLARS.
THE THOSE INDUSTRIAL TYPE USERS AND HIGHER STRENGTH CUSTOMERS HAVE HIGHER PROPORTIONS OF THE BIOCHEMICAL OXYGEN DEMAND AND TOTAL SUSPENDED SOLIDS, SO THEY PICK UP MORE OF THAT.
WE TOTAL IT ALL UP TO GET THOSE TOTAL COSTS OF SERVICE.
THANK YOU. AND THANK YOU, MAYOR.
ANY MORE QUESTIONS ON THAT? CAN I ASK ONE QUESTION, PLEASE? SURE. WILL WE FIND OUT LATER WHICH OF THOSE COMPONENTS HAS CHANGED TO CHANGE THESE RATES? I'M NOT SURE I UNDERSTAND YOUR QUESTION.
WELL, IT LOOKS LIKE THE RATES FOR NON RESIDENTIAL CUSTOMERS HAVE GONE DOWN, THEIR COSTS ARE GOING TO GO DOWN WHEREAS THE RESIDENTIAL RATES ARE GOING UP.
SO I'D LIKE TO FIND OUT WHAT THE PARTICULAR COMPONENTS ARE CAUSING THAT.
THE FINAL REPORT WILL HAVE ALL THOSE COMPONENTS IN MANY TABLES.
SO IF YOU LIKE TABLES WE COULD PROVIDE THOSE TO YOU AND YOU COULD SEE HOW THAT FALLS OUT.
ALL RIGHT. SO THAT'S OPTION ONE.
WE HEARD THAT REVENUE STABILITY IS IMPORTANT.
CONSERVATION AND DEMAND MANAGEMENT IS VERY IMPORTANT.
THE ADMINISTRATIVE BURDEN AND PROPORTIONALITY.
OR YOU KNOW, I CHANGED THAT WORD.
IT WAS EQUITY. BUT WE'RE CALLING IT PROPORTIONALITY.
BETWEEN AND WITHIN CUSTOMER CLASSES.
AND AFFORDABILITY ARE ALL IMPORTANT OBJECTIVES AND PRIORITIES.
AND THEN WE CRAFTED TWO MORE SCENARIOS.
IF WE'RE TALKING ABOUT REVENUE STABILITY THAT IS BEST ACHIEVED THROUGH A FIXED CHARGE.
A FIXED CHARGE IS APPLIED PER METER AND IS A FIXED AMOUNT PER MONTH.
SO SOMETIMES IT'S CALLED A BASE CHARGE.
IF WE WERE TO RECOVER FIXED COSTS THROUGH A FIXED CHARGE, THAT CHARGE WOULD BE VERY HIGH.
IT WOULD COMPRISE LIKE 80%, 80 TO 90% OF ALL YOUR THE COSTS THAT YOU NEED TO RECOVER.
WE WANT TO SET THAT THRESHOLD OF HOW MUCH OF YOUR REVENUE SHOULD BE RECOVERED THROUGH THAT FIXED CHARGE BY LOOKING AT THE BOND RATING AGENCIES, THEY HAVE SOME METRICS THAT THEY LIKE TO SEE.
AND ALSO YOU CURRENTLY HAVE A BEST PRACTICE FOR WATER SERVICES.
BY POLICY, YOU REQUIRE WATER SERVICES TO SET THAT FIXED CHARGE TO BE TO RECOVER NO LESS THAN 25% OF YOUR TOTAL REVENUE. SO WE THOUGHT, WHY NOT BE CONSISTENT BETWEEN WATER AND WASTEWATER.
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REVENUE REQUIREMENTS.THE FIRST TABLE ON THE LEFT SHOWS YOU THE FIXED CHARGES BY METER SIZE.
EACH METER SIZE CAN BE ASSOCIATED WITH AN EQUIVALENT RESIDENTIAL UNIT.
WE'VE TALKED ABOUT THIS WHEN WE WERE TALKING ABOUT CAPACITY FEES.
SO THE ERU OR EQUIVALENT RESIDENTIAL UNIT IS ESSENTIALLY ONE THREE QUARTERS INCH METER.
EACH METER SIZE THEREAFTER HAS A CERTAIN FLOW CAPACITY, SO CUSTOMERS WITH A LARGER METER SIZE CAN USE MORE WATER, WHICH TRANSLATES INTO MORE WASTEWATER. SO WE HAVE AN ERU FACTOR THAT WE CAN USE TO SCALE THOSE FIXED CHARGES.
THE TABLE SHOWS YOU THE 2025 FIXED CHARGE THAT'S SET TO RECOVER 25% OF THE FISCAL YEAR 2025 REVENUE REQUIREMENTS.
WE LOOK AT ALL OF YOUR ERUS FOR THE WASTEWATER SYSTEM.
SO WE TALLY UP HOW MANY METERS BY SIZE ARE IN THE WASTEWATER, ARE GETTING BILLED FOR WASTEWATER, AND WE CAN CALCULATE A TOTAL NUMBER OF ERUS SO THAT WE CAN CALCULATE WHAT ONE ERU EQUALS.
SO YOU HAVE YOUR FIXED CHARGES ON THE LEFT.
ON THE RIGHT WE HAVE THE SAME VOLUME RATES BY CUSTOMER CLASS THAT YOU HAVE NOW.
WE JUST RECALCULATE THEM TO RECOVER NOT ONLY THE COST OF SERVICE BY CLASS.
SO WE'RE STILL FOLLOWING THOSE COST OF SERVICE PRINCIPLES THAT WE SHOWED YOU.
BUT NOW WE'RE TAKING FOR 2025.
SO YOU'LL SEE WITH A FIXED CHARGE, ALL OF THOSE RATES ARE LOWER THAN WHAT WE SHOWED YOU BEFORE.
THIS OPTION ENHANCES THE REVENUE STABILITY COMPONENT.
ANY QUESTIONS ON THIS ONE? WE DO HAVE ONE.
CAROL, YOU TOOK A MOMENT TO DESCRIBE WHERE THE 25% CAME FROM.
CAN YOU GIVE US SOME PERSPECTIVE HOW THAT RELATES TO WHAT OTHER COMMUNITIES MAY CHARGE IN TERMS OF A BASE FEE OR A FIXED CHARGE? ABSOLUTELY. SO, MAYOR AND WATER COMMISSIONERS, WE WE KNOW THAT SOME OF THE COMMUNITIES IN THE AREA HAVE A BASE CHARGE THAT RECOVERS, SAY, JUST THE COST OF BILLING AND CUSTOMER SERVICE.
THE ALBUQUERQUE BERNALILLO COUNTY WATER UTILITY AUTHORITY THAT I'VE BEEN WORKING WITH FOR A LONG TIME, CHARGES A BASE CHARGE THAT RECOVERS 50% OF THEIR REVENUE REQUIREMENT, SO IT COULD RANGE FROM 10% TO 50% OF THE REVENUE REQUIREMENT.
I GUESS ALONG THAT SAME LINE, WHAT GUIDANCE DO BONDING AUTHORITIES GIVE TO THIS TYPE OF THING? WHAT I'M THINKING OF THERE, WOULD WOULD THE CITY POTENTIALLY DO ITSELF A FAVOR BY GIVING ITSELF MORE BONDING CAPACITY, BY CHARGING A HIGHER BASE RATE? THE THE BOND RATING AGENCIES USE A NUMBER OF METRICS TO RATE A UTILITY FOR BORROWING MONEY, RIGHT.
SO YOU CAN GET A RATING BASED ON A NUMBER OF FACTORS.
THE THE FIXED CHARGE PROPORTION IN ONE OF THE I THINK IT'S FITCH ONE OF THE BOND.
THERE'S THREE BOND RATING AGENCIES.
SO ONE LOOKS AT A HIGHLY RATED UTILITY MEDIAN.
AND THAT MEDIAN IS 30% OF THE REVENUE REQUIREMENT.
SO THAT'S A DOUBLE A RATED UTILITY.
SO IT WOULD GET A IT WOULD HELP YOU GET A LOWER INTEREST RATE IF YOU WERE MORE HIGHLY RATED.
YOU'RE ALREADY VERY HIGHLY RATED.
BUT RIGHT NOW IT IT'S JUST ONE OF THOSE METRICS THAT WE USE.
NO THANK YOU. WE HAVE A QUESTION FROM COUNCIL MEMBER MATTHEWS.
CAROL, WHEN YOU WHEN I LOOK AT THIS CHART WHEN YOU ADD THE FIXED RATE FACTOR TO THEN THE, THE CURRENT RATE FOR USAGE, IS IT NET OUT, YOU KNOW, JUST PULLING SOME SAMPLE CLIENTS UP.
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IS THIS A MORE OF AN INCREASE OR LESS OF AN INCREASE? DOES THAT MAKE SENSE? MAYOR AND COUNCIL MEMBER MATTHEWS IT DEPENDS.IT'S INTERESTING. WE'LL SEE SOME EXAMPLES, BUT IT DEPENDS ON THE CUSTOMER BECAUSE YOU CAN SEE AS THE THE LARGER METER SIZE HAVE A LARGER FIXED FEE, OF COURSE.
AND IF YOU HAVE A LARGE METER SIZE AND LOW WATER USE, YOU MIGHT HAVE A DECREASE IN YOUR BILL.
IF YOU HAVE A SMALL METER SIZE AND A LARGE WATER USE, YOU MAY STILL HAVE AN INCREASE IN YOUR BILL.
SO IT REALLY DOES DEPEND ON THE MIX OF YOUR METER SIZE AND YOUR WATER USAGE THAT MONTH.
EXCUSE ME FOR RESIDENTIAL CUSTOMERS, OF COURSE.
IT'S AN AVERAGE WINTER MONTHLY USAGE.
I DID THAT. ANSWER YOUR QUESTION.
YEAH, IT WAS KIND OF VAGUE, BUT IT DID ANSWER MY QUESTION.
[INAUDIBLE] THOSE LAST TWO NUMBERS ON THE RIGHT HAND SIDE, THEY'RE INVERTED FOR LIKE THE PET FOOD.
AND THE IN THE RIGHT COLUMN, AND THE REVERSE WAS FOR THE ICE CREAM CONE.
IS THAT HAVE TO DO WITH WHAT YOU'RE JUST TALKING ABOUT? IT ACTUALLY IS NOT INVERTED.
IT'S A RESULT OF THE PET FOOD MANUFACTURERS.
THE IN ENCODE THEIR THEIR ASSUMED STRENGTH WAS BEFORE WAS SET BEFORE THEY INCORPORATED.
SO THEY'VE ACTUALLY LOWERED THAT STRENGTH THAT'S COMING INTO THE SYSTEM.
SO WE HAVE A LOWER STRENGTH ASSUMED FOR THEM.
THEREFORE THEIR RATE IS LOWER.
THEY BENEFIT NOW FROM THOSE PROCESS IMPROVEMENTS.
AND THE ICE CREAM CONE MANUFACTURING.
SO THAT ONE IS A LITTLE A LITTLE DIFFERENT.
WE ACTUALLY DID NOT CHANGE THE THRESHOLDS IN THEIR ENCODE FOR THAT CUSTOMER TYPE.
I DON'T SEE ANY OTHER QUESTIONS.
THE NEXT OBJECTIVE OR PRIORITY THAT WE TALKED ABOUT WAS ADMINISTRATIVE BURDEN AND SIMPLIFYING, NOT BEING HAVING SUCH A COMPLEX RATE STRUCTURE. RIGHT NOW, THERE ARE PLENTY OF CUSTOMER CLASSES ON THE WASTEWATER SIDE, BUT WE CAN LOOK AT THEM AND LOOK AT THEIR FLOW AND STRENGTH CHARACTERISTICS TO CONSOLIDATE THEM.
RESIDENTIAL AND MULTIFAMILY, OF COURSE, ARE RESIDENTIAL.
THEY USUALLY DON'T VARY THAT MUCH IN THEIR IN THEIR STRENGTHS.
THE SECOND GROUP, THOUGH, WHEN WE TAKE A LOOK AT THE CONCENTRATIONS OF THE WASTEWATER FLOW AND THE AMOUNT OF FLOW AND HOW MANY POUNDS OF WASTEWATER THEY'RE CONTRIBUTING TO THE SYSTEM, WE CAN GROUP THESE NONRESIDENTIAL CLASSES INTO THREE GROUPS.
SO THIS WOULD BE NONRESIDENTIAL A, B, AND C.
WE COULD COME UP WITH MORE CREATIVE NAMES.
BUT WE WANTED TO BE SIMPLE HERE.
SO NONRESIDENTIAL A INCLUDES CAR WASHES, LAUNDRIES REGULAR COMMERCIAL ENTITIES THE INSTITUTIONAL CUSTOMER MANUFACTURING REGULAR MANUFACTURING AND THEN HOTELS AND MOTELS.
THESE ALL EXHIBIT SIMILAR STRENGTH WASTE.
SO WE SUGGEST THAT THEY ARE IN THEIR OWN GROUP C, OR B, EXCUSE ME.
WITH THIS TYPE OF GROUPING, WE CAN LOOK AT THE COST RECOVERY WITHIN THAT GROUP, CONSOLIDATE THEM AND HAVE EVERYONE BENEFIT FROM BEING CONSOLIDATED IN THOSE GROUPS.
YOU CAN SEE THAT IN THE NEXT SET OF RATES.
I NOTICED THAT HOTELS AND MOTELS, WHEN WE WERE LOOKING AT THE COST RECOVERY VERSUS WHAT WE'RE CURRENTLY RECOVERING, WAS THE THE FUTURE COST RECOVERY FOR HOTELS AND MOTELS WAS LOWER THAN THE CURRENT.
YOU ARE MAYOR. SO GROUPING THEM LIKE THIS, DOES THAT PUT A AN UNDULY HEAVY BURDEN ON HOTELS AND
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MOTELS OVER THE OTHER INDUSTRIES? THAT'S A GOOD QUESTION.AND I KNOW THAT THEIR CURRENT RATE IS HIGHER.
SO I THINK EITHER OF THESE OPTIONS WOULD BE A BENEFIT TO THEM, WHETHER THEY STAND ALONE OR THEY.
SO I DON'T KNOW IF THEY WOULD I DON'T I WOULDN'T CALL THAT AN UNDUE BURDEN.
WE'D HAVE TO LOOK AT THE INDIVIDUAL CUSTOMERS.
LET'S TAKE A LOOK AT THE RATE ITSELF, UNLESS WE HAVE ANOTHER QUESTION.
I'M CONCEPTUALLY IN FAVOR OF THE SIMPLIFICATION, BUT I'M WONDERING AT WHAT POINT MIGHT YOU RUN INTO LEGAL RISKS, YOU KNOW, THAT A PARTICULAR CLASS THAT WAS A GROUP, THAT IT WAS AT THE LOW END OF THE, YOU KNOW, STRENGTH PROFILE FOR THAT GROUPING? MIGHT THEY PUT UP THEIR HANDS AND COMPLAIN AND SAY, GEE, I SHOULDN'T BE IN THIS GROUPING.
DOES THE STATE GIVE ANY GUIDANCE ON THAT? YOU KNOW, WHAT LEVEL OF GROUPING YOU CAN DO? OR IS THERE A STANDARD PRACTICE TO GIVE GUIDANCE THERE? THE STANDARD PRACTICE THAT WE REFER TO IS THE WATER ENVIRONMENT FEDERATION, THE MANUAL PRACTICE NUMBER 27.
BUT WHAT WE KNOW AND IN SOME OTHER INSTANCES WHERE WE HAVE RECOMMENDED THIS CONSOLIDATION, IF A CUSTOMER CLASS CONTESTS WHERE THEY'RE PLACED, IT IS UP TO THEM TO PROVE THAT THEY ARE LOWER, YOU KNOW, BY SAMPLING BECAUSE THEY COULD SAMPLE AND SAY, HEY, WE DON'T BELONG IN THIS CLASS.
WE WILL SET UP THE PARAMETERS FOR THESE CLASSES AND PROVIDE IT TO JESSICA AND THE THE TEAM.
AND THIS IS WE'VE A LONG TIME AGO, I DID THIS FOR A COMMUNITY IN SOUTHERN OHIO.
EXCUSE ME. I HAVE THAT PROBLEM AGAIN WHERE I START COUGHING.
EXCUSE ME. AND THEY DID HAVE A COUPLE CUSTOMERS WHO PAID FOR A SAMPLING.
OH, NO. DO YOU WANT TO TAKE A LITTLE BREAK? LET'S JUST CONSIDER THIS A FIVE MINUTE BREAK.
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MAYOR WE'RE AT FIVE MINUTES.IF YOU'D LIKE TO GET STARTED YOU CERTAINLY COULD.
WE'RE GOING TO BEGIN WITH A QUESTION FROM COUNCIL MEMBER SWEET.
THANK YOU. SO WHEN I WAS LOOKING AT THIS, I THOUGHT DAWNED ON ME.
SO FOR NAU, THEY HAVE RESIDENTIAL.
WHERE WOULD THEY FALL? MAYOR AND COUNCIL MEMBER SWEET THE THE ACCOUNTS THAT ARE CODED AS RESIDENTIAL FOR NAU ARE IN THE RESIDENTIAL CLASS, BUT THEY ALSO HAVE A COMMERCIAL TYPE DESIGNATION AS WELL AS ITS THEIR OWN RATE.
SO THOSE THOSE ACCOUNTS WOULD FALL INTO THAT NONRESIDENTIAL A.
THANK YOU. OKAY LET'S LOOK AT THE RATES.
SO THIS LOOKS VERY SIMILAR TO OPTION TWO.
BUT NOW WE'VE CONSOLIDATED THE VOLUME RATES FOR THE NON RESIDENTIAL CLASS INTO A B AND C.
SO SAME FIXED CHARGE AS OPTION TWO AGAIN VARIES BY BY WATER METER SIZE.
ON THE VOLUME SIDE WE HAVE THAT A WE'VE GOT THE CAR WASHES THROUGH HOTELS AND MOTELS AND YOU SEE THAT THAT RATE IS LOWER.
IT'S THE THAT'S ALMOST LIKE AVERAGING THE RATE FOR ALL OF THOSE CLASSES.
AND WE DIVIDE BY THEIR FLOWS AND LOADINGS.
SO THAT GETS US TO THE $4.45 PER THOUSAND GALLONS FOR ALL OF THOSE CUSTOMERS IN THAT CLASS.
AND, MAYOR, YOU WERE ASKING ABOUT HOTELS AND MOTELS FROM A CURRENT RATE OF $7.58.
THAT RATE WOULD GO DOWN TO $4.45.
ON THE NONRESIDENTIAL B YOU SEE AGAIN THAT THAT RATE IS LOWER FOR THESE CUSTOMERS AND NONRESIDENTIAL C, IT IS WHAT IT IS THAT DOESN'T CHANGE.
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SO BETWEEN OPTIONS TWO AND THREE, THE RESIDENTIAL CLASS AND THE ICE CREAM CONE MANUFACTURING RATES DON'T CHANGE FROM A COST OF SERVICE PERSPECTIVE.ANY QUESTIONS ON THIS ONE? COUNCIL MEMBER MCCARTHY.
THIS WAS IN YOUR SUPPLEMENTAL MATERIALS PACKET FROM LAST NIGHT THAT YOU'VE ALL STUDIED, I'M SURE, BUT WE COULD GO OVER THIS IN AS MUCH DETAIL AS YOU LIKE. BUT ESSENTIALLY WHAT WE WE TRIED TO DO WAS GO AND DIG INTO THE BILLING DATA FOR EVERY TYPE OF CUSTOMER.
WE LOOKED AT ALL OF THE BILLS FOR EACH CLASS.
SO WE'LL TAKE RESIDENTIAL AS AN EXAMPLE.
THERE ARE OVER 21,000 ACCOUNTS, RESIDENTIAL AND MULTIFAMILY, AND WE LOOKED AT ALL OF THEIR BILLS.
SO THAT'S 12 BILLS FOR A YEAR.
THEIR AVERAGE BILL VOLUME FOR BILLED SEWER FLOW WAS 4,880 GALLONS, OR 4.88 THOUSAND GALLONS.
CURRENTLY OR ACTUALLY WE WERE LOOKING AT FISCAL YEAR 2023 DATA.
THAT WAS THE PAST FISCAL YEAR.
BUT YOU HAVE THE SAME RATES TODAY THAT YOU DID IN 2023.
SO THE BILL WAS FOR A MONTH WAS $26.13 FOR THIS AVERAGE OF ALL OF THOSE BILLS.
I WOULD NOT SAY THAT THIS IS A TYPICAL CUSTOMER, IT'S JUST AVERAGE.
SO AN INCREASE THEIR BILL WOULD GO FROM $26.
13 I CANNOT DO THAT MATH IN MY HEAD, BUT YOU'D ADD ON $9.67.
FOR OPTION TWO AND THREE WHEN WE TAKE A PORTION OF THEIR REVENUE REQUIREMENT AND DROP IT INTO A FIXED CHARGE, THEIR MONTHLY BILLS WOULD GO UP BY $12.23 A MONTH.
SO THAT WOULD BE THAT INCREASE THE CHANGE IN THE BILL.
LET'S COMPARE THAT TO WHICH ONE DO YOU WANT TO COMPARE THAT TO? LET'S LET'S PICK THE HOTELS AND MOTELS SINCE THE MAYOR POINTED THOSE OUT.
THERE ARE 97 ACCOUNTS CURRENTLY THAT WE'RE SHOWING IN THE BILLING DATA FROM FISCAL YEAR 23.
THE TYPICAL OR AVERAGE METER SIZE FOR THESE ACCOUNTS IS TWO INCHES.
THE AVERAGE BILL VOLUME IS 126.75 KL, AND THE CURRENT BILL IS JUST UNDER $1,000 PER MONTH. EXCUSE ME.
WITH A STRAIGHT COST OF SERVICE RATE.
EXCUSE ME. THAT BILL WOULD GO DOWN BY $182.
IT WOULD GO DOWN MORE WITH THOSE TWO OTHER OPTIONS.
I'LL TRY TO TALK THROUGH THE REST OF THIS.
WOULD YOU LIKE TO TALK THROUGH ANY OTHER EXAMPLES THAT WE'RE LOOKING AT, OR DO YOU HAVE ANY QUESTIONS ON THESE RESULTS? YES. OKAY.
SO WITHIN THESE WITHIN THESE RATE STRUCTURES, THE FIXED OR THE, THE THE BASED ON USAGE AND THIS KIND OF PLAYS INTO WATER AND THEN SEWER IS THERE, IS THERE A CONSIDERATION OR DOES THERE NEED TO BE CONSIDERATION GIVEN TO LIKE A CHANGING DYNAMIC IN OUR CITY WHERE YOU HAVE MORE SECOND HOMES WITH LESS WATER USAGE AND INHERENTLY LESS INCOME TO THE CITY BASED ON USAGE, WHEREAS IT DOESN'T COST THE CITY ANY LESS TO MAINTAIN THE WATER SYSTEM.
SO I DON'T KNOW IF THAT IF THERE'S CONSIDERATION GIVEN TO THAT, IF IT'S WORTHWHILE DOING THAT.
AND AND HOW THAT THE BEST WAY TO HANDLE THAT WOULD BE.
MAYOR, MR. LOVERICH THAT QUESTION DID COME UP FROM A COMMISSIONER.
[00:45:04]
AND I APOLOGIZE FOR NOT GETTING THAT TO YOU ON FRIDAY.STANTEC LOOKED UP HOW MANY ACCOUNTS WERE BILLED.
FOR 10 TO 12 MONTHS IN FISCAL YEAR 23, THERE WERE 1,600 ACCOUNTS.
SO THAT WOULD BE HOW MANY RESIDENTIAL WERE THOSE RESIDENTIAL OR ALSO NON RESIDENTIAL.
I'LL LOOK THAT UP. YEAH THEY MIGHT NOT ALL BE RESIDENTIAL ACCOUNTS, BUT THAT'S THE NUMBER OF ACCOUNTS THAT WOULD SEE THE INCREASE JUST BECAUSE OF THE BASE CHARGE.
WE HAVE AN ONLINE QUESTION FROM COUNCIL MEMBER MATTHEWS.
SO A COUPLE OF QUESTIONS, BUT MY FIRST ONE IS ON OPTION TWO AND THREE.
THE MAJORITY OF THE USERS/ CLIENTS WILL SEE A COST SAVINGS.
SO HOW DO WE GET TO RECOVERING OUR COST OF SERVICE? MAYOR AND COUNCIL MEMBER MATTHEWS THE NUMBER OF CUSTOMERS JUST LOOKING AT THE NUMBER OF ACCOUNTS PER CUSTOMER CLASS, 21,000 RESIDENTIAL ACCOUNTS, WE GAIN THAT $10 A MONTH IN THE BASE CHARGE FROM THAT LARGE NUMBER OF CUSTOMERS. SO IT REDUCES THE BURDEN ON THE OTHERS.
[INAUDIBLE] SO EVERYTHING IS REVENUE NEUTRAL.
SO WHILE YOU HAVE I THINK THAT WAS WAS THAT COUNCIL MEMBER MATTHEW'S QUESTION? YES. WHILE YOU HAVE LESS REVENUE BEING RECOVERED FROM SOME OF THOSE CLASSES, YOU HAVE MORE REVENUE RECOVERED FROM OTHERS.
SO, ALL THINGS BEING EQUAL, IF EVERYONE, YOU KNOW, ACCOUNTS LEFT THE SYSTEM OR USED LESS WATER, WE WOULD COLLECT THE SAME AMOUNT OF REVENUE BECAUSE OF SOME CUSTOMERS BILLS GOING UP AND SOME GOING DOWN.
ALL RIGHT. AND THEN, BY THE WAY, I'M.
I'M STRUGGLING WITH THE SAME COUGHING THAT YOU HAVE.
I WAS SICK A COUPLE OF WEEKS AGO, AND EVERY THIRD DAY I JUST COUGH ALL DAY LONG.
SO HOPEFULLY YOU GOT I'M CONCERNED ABOUT THE ICE CREAM CONE MANUFACTURER.
WE ONLY HAVE ONE, AND WE'RE JUST TALKING RIGHT HERE WASTEWATER, WHICH WOULD BE BEST CASE SCENARIO, AN INCREASE OF $132. WORST CASE $213 MORE DOLLARS IN JUST WASTEWATER.
COULD THEIR RATE BE ABSORBED IN SOME OF THESE OTHER SECTIONS? AND THEN MY OTHER QUESTION WAS YOU MENTIONED CAROL, THAT NAU HAS THEIR OWN RATE SYSTEM.
COULD YOU EXPAND ON THAT A LITTLE BIT? YOU SAID THEY HAD SOME ARE SOME OF THEIR METERS ARE CODED RESIDENTIAL.
SOME ARE CODED COMMERCIAL, I BELIEVE.
BUT THEN YOU YOU MADE A STATEMENT ABOUT THEY HAD THEIR OWN RATE STRUCTURE.
THEY HAVE A DIFFERENT RATE STRUCTURE THAN THE REST OF THE CITY.
SO MAYOR AND COUNCIL MEMBER MATTHEWS I'LL ANSWER THE EASIER QUESTION FIRST.
SO OUT OF ALL OF THE ACCOUNTS THAT NAU HAS, SOME OF THEM ARE BILLED AS RESIDENTIAL CUSTOMERS.
SO THEY WOULD PAY THE THE CURRENT RATE FOR RESIDENTIAL AND THEN SOME ARE BILLED AS THEIR OWN RATE FOR WASTEWATER.
SO IF YOU LOOK ON YOUR RATE SCHEDULE AND THAT WOULD BE.
SO THEIR OWN RATE MEANING INSTITUTIONAL? MEANING INSTITUTIONAL.
SO THEY CURRENTLY PAY THAT THAT RATE RIGHT NOW OKAY.
SO NEXT FIRST QUESTION WAS THE ICE CREAM CONE MANUFACTURER.
WE HAVE BEEN DISCUSSING THIS FOR A WHILE WITH WITH JOLENE MONTOYA.
AND WE'VE TALKED ABOUT POSSIBLY A, SOME INTERACTIONS WITH THE CUSTOMER AND SOME DISCUSSIONS ON EITHER PHASING IN THAT RATE. IT IS NOT LEGAL TO SUBSIDIZE OTHER CUSTOMERS WITH, YOU KNOW THAT THAT THAT IS A NO NO FROM A RATEMAKING PERSPECTIVE, TO SUBSIDIZE ONE CUSTOMER, BY ANOTHER CUSTOMER'S RATES.
[00:50:05]
SO WE WANT TO MAKE SURE THAT THERE ARE SOME COMMUNICATIONS AND SOME STEPS TO TAKE WITH THE CUSTOMER TO POSSIBLY IF THEY COULD IMPROVE THEIR PRETREATMENT SYSTEMS AND THEY COULD LOWER THEIR BILL.THANK YOU. AND UNDERSTANDING THAT YOU ARE NOT AN ICE CREAM CONE MANUFACTURER, I'M WONDERING WHETHER THERE ARE SOME EFFICIENCIES THAT THEY COULD INSTALL ON THEIR SIDE TO REMOVE SOME OF THE MATERIALS BEFORE IT'S RELEASED INTO THE SEWER.
I'M ALSO WONDERING WHETHER THERE ARE ANY GRANTS THAT MAY BE, AND I DON'T KNOW IF THIS COUNTS AS HELPING WITH THE SUBSIDY, BUT ANY GRANTS THAT THE CITY COULD HELP THEM FIND TO MAKE SOME IMPROVEMENTS ON THEIR.
OKAY. I THINK JOLENE IS WILLING TO RESPOND TO THAT? YES, I AM.
YES. SO [INAUDIBLE] ACTUALLY HAS BEEN WORKING WITH THE CITY AND ACTUALLY WITH ADEQ TO FIND A SOLUTION TO MAKE THEIR WASTEWATER BETTER AND LESS HIGH IN THE BOD AND TSS.
SO WE'VE BEEN WORKING WITH THEM IN THAT WAY.
WE ALSO ARE A A WAY TO REBATE SOME OF THE FINES THEY'VE BEEN PLAYING TO PAY FOR THE PRETREATMENT EQUIPMENT THEY'RE BUYING, BUT THEY HAVE NOT YET TOOK THAT OPTION FROM US.
AND I SAW WE HAD A QUESTION DOWN HERE.
YEAH. I WAS JUST WONDERING ABOUT STATISTICALLY.
I USE AN AVERAGE FOR THESE, LIKE THE RESIDENTIAL AS A LARGE NUMBER OF ACCOUNTS.
IF YOU HAVE A LOT OF USERS AT THE HIGH END WILL PULL THE AVERAGE TOWARDS THE HIGH END.
HAVE YOU CONSIDERED USING THE MEDIAN? THAT'S A GREAT QUESTION.
WE WE DID NOT THINK ABOUT THE MEDIAN, BUT WE CERTAINLY COULD OR THE MODE, YOU KNOW, WE COULD PICK ANY ONE OF THOSE STATISTICAL METRICS IN ORDER TO SHOW THE BILL. I WAS JUST THINKING, THERE'S I REMEMBER LOOKING AT THE RESIDENTIAL, THERE WERE A LOT OF CUSTOMERS WHO WANTED THEIR LAWNS EXTENSIVELY AND COULD PULL THAT. AVERAGE UP.
SO WHEREAS THE MEDIAN WOULD TAKE THAT INTO ACCOUNT.
THERE'S ONE THING ABOUT RESIDENTIAL CUSTOMERS IS THEIR SEWER BILL.
THEIR BILLED SEWER FLOW IS BASED ON THEIR WINTER WATER USAGE.
SO HOPEFULLY THEY'RE NOT WATERING TOO MUCH.
SO THIS AVERAGE SHOULD EXCLUDE ANY SUMMER WATERING.
WE HAVE ANOTHER QUESTION? YES. BACK TO THE SLIDE WE'RE ON HERE.
JUST TO MAKE SURE I UNDERSTAND THE WAY IT WORKS IN THE RIGHT, THREE, THREE RIGHT HAND COLUMNS.
LET'S JUST USE RESIDENTIAL AS THE EXAMPLE.
MY UNDERSTANDING IS, ACROSS ALL THREE OPTIONS, YOU NEED TO RECOVER THE SAME AMOUNT OF TOTAL MONEY.
IS THAT CORRECT? THAT'S CORRECT.
AND THEN. SO HOW SHOULD I UNDERSTAND THE $9.67 VERSUS THE $12.23 AND SO ON AND SO FORTH.
HOW DO WE RECOVER THE SAME AMOUNT OF MONEY ACROSS ALL THREE OF THOSE? THAT'S A GOOD QUESTION.
IT IS THE TYPE OF THE RATE STRUCTURE.
SO HOW THE DESIGN RESULTS IN A RATE THE RATE PER UNIT OF VOLUME FOR OPTION ONE FOR RESIDENTIAL CUSTOMERS I THINK IS $7. EXCUSE ME, I HAVE TO GO BACK.
OH, YOU KNOW WHAT? LET ME GO TO THE SUMMARY SLIDE.
OPTION ONE IS LISTED HERE FIRST.
AND IF YOU GO FOR OPTION ONE STRAIGHT COST OF SERVICE RATES, THE RESIDENTIAL RATE WOULD BE $7.33.
SO THAT WOULD BE THE $9.67 INCREASE FROM THEIR CURRENT BILL.
IF YOU GO TO OPTION 2 OR 3, THAT CUSTOMER PAYS $10.39 FOR THEIR FIXED CHARGE, AND THEN FOR THEIR VOLUMES OF USE, THEY'LL PAY $5.50.
SO IT'S INTERESTING BECAUSE I REMEMBER I TALKED ABOUT THE WHEN YOU HAVE A FIXED CHARGE, IT MATTERS WHAT YOUR METER SIZE AND YOUR VOLUME OF USES. SO WITH THE SAME VOLUME OF USE, WE SEE A LARGER IMPACT FOR THIS PARTICULAR TYPE OF CUSTOMER, EVEN WITH A FIXED CHARGE, BECAUSE THEIR FIXED CHARGE BECOMES A LARGER COMPONENT OF THEIR BILL SINCE THEY'RE A SMALLER WATER USER.
[00:55:01]
YOU KNOW, AND THEREFORE SEWER FLOW.I DON'T KNOW IF THAT THAT HELPS.
OKAY. IT TAKES SOME TIME TO LOOK AT THESE, THE RESULTS AND THESE OPTIONS YES. AND I, I THOUGHT THAT WE HAD ADDED A LITTLE CLARIFIER AT THE TOP THAT THESE ARE INCREMENTAL CHANGES.
AND DO WE HAVE TO APPLY THE SAME EQUATION TO EACH CUSTOMER CLASS? MAYOR, IF I UNDERSTAND YOUR QUESTION, WHEN WE'RE CALCULATING THE BILL.
YES. SAY, IF WE'RE WE'RE HERE DECIDING WHETHER WE WANT TO LEAN MORE ON FIXED COSTS OR FLOW, CAN THOSE BE, CAN WE CALCULATE IT DIFFERENTLY BASED ON CUSTOMER CLASS? I THINK I DID NOT UNDERSTAND THAT WHEN YOU'RE CALCULATING THE THE BILLS, THE THE FLOW MATTERS IN THE WATER METER, SIZE MATTERS. SO WE LOOK AT THE FOR OPTION ONE WE'RE ONLY USING FLOW FOR THAT FORMULA.
AND FOR OPTIONS TWO AND THREE WE'RE USING THE METER SIZE AND FLOW.
AND BUT WHAT I'M SAYING YOU JUST SAID THAT THE OPTION ONE IS LESS OF AN INCREASE ON RESIDENTIAL, BUT GETS US TO THE SAME PLACE.
SO CAN WE USE ONE METHOD OF CALCULATION FOR RESIDENTIAL, BUT THEN USE A DIFFERENT METHOD OF CALCULATION FOR OTHER USES? I UNDERSTAND, SO USE OPTION ONE FOR RESIDENTIAL AND OPTION SAY THREE FOR NONRESIDENTIAL.
I THINK THAT SHOULD GO IN THE PARKING LOT.
OH MAN. I'VE BEEN PUT ON THE PARKING LOT.
WE CERTAINLY COULD, YOU KNOW, BECAUSE IT WOULD THEORETICALLY.
SO THEIR, THEIR BILL IMPACTS GOING TO BE DIFFERENT.
SO THAT CHANGES THE PICTURE IN THIS TABLE.
SO YES, WE COULD DO IT BUT THERE WOULDN'T BE A REASON TO DO IT.
I'M NOT SURE THAT YOU WOULD WANT TO DEPART FROM THAT REVENUE STABILITY GOAL.
YOU KNOW THAT THAT EVEN THOUGH THAT IS A I SEE WHAT YOU'RE SAYING.
I DON'T KNOW IF YOU'D WANT TO DO THAT.
AND FOR SIMPLICITY'S SAKE, TOO REMEMBER THAT WAS ONE OF OUR, OUR OBJECTIVES.
EVERYONE PAYS A FIXED CHARGE JUST LIKE THEY DO FOR WATER.
THANK YOU. THAT WAS A GOOD CREATIVE THOUGHT THOUGH.
WELL, AS IF THESE TABLES WEREN'T COMPLICATED ENOUGH.
I THINK I COULD UNDERSTAND IT A LOT BETTER IF THAT WERE THERE.
RIGHT. YEAH. LET'S KEEP THINGS SIMPLE.
RIGHT. WELL I WANT TO KEEP THINGS SIMPLE, BUT I WANT TO MAKE IT UNDERSTANDABLE.
THANK YOU. IF YOU RECALL, WHEN WE TALKED, OH, MAYBE A COUPLE OF WEEKS AGO, WE PROVIDED OR STAFF PROVIDED A MUNICIPAL TYPICAL MUNICIPAL SERVICES BILL, AND THAT BROKE A PARTICULAR SCENARIO DOWN INTO THE DIFFERENT COMPONENTS.
I THINK THAT WOULD HELP US UNDERSTAND THE WHOLE PICTURE.
WE HAVE THIS EXTRA SLIDE THAT WAS IN THE PACKET THAT YOU RECEIVED TODAY.
IT'S AN ANALYSIS OF THE BILLS AND AND A COMPARISON OF WHERE CUSTOMERS MIGHT BE LEANING IF THEY SAW THAT IMPACT ON THEIR BILL.
IT'S MORE COLUMNS, BUT AT LEAST IT GIVES A LITTLE BIT MORE INFORMATION.
SO THE THE FIRST FEW COLUMNS ARE THE SAME AS WHAT WE SAW IN THE SLIDE BEFORE.
[01:00:01]
THE RED INDICATES THOSE THOSE OPTIONS BY CUSTOMER CLASS WHERE THEIR BILL WOULD GO DOWN.SO IT'S A LITTLE EASIER WAY TO SEE THE REDUCTIONS IN THE BILL.
WE COULD YOU COULD GET OUT YOUR CALCULATORS LATER, BUT THEN THE LAST THREE COLUMNS SHOW THE LOWEST IMPACT FOR THAT CUSTOMER, WHERE FROM A CUSTOMER'S PERSPECTIVE, THEY WOULD WANT TO PICK THAT OPTION.
ABOUT THIS TABLE? I THINK IT TAKES SOME TIME TO DIGEST.
THAT'S A LOT OF YOUR CUSTOMER BASE ON THE WASTEWATER SIDE.
THAT TURNS OUT TO BE ABOUT 92 ACCOUNTS THAT MIGHT PREFER THAT OPTION.
AND THEN THE THIRD OPTION WOULD COULD RESULT IN ABOUT ALMOST 1,600 ACCOUNTS PREFERRING THAT OPTION.
SO THIS IS ESSENTIALLY WHAT I ASKED WHETHER WE COULD DO.
IF WE WERE TO PICK AND CHOOSE BETWEEN METHODS OF CALCULATION.
SO OF COURSE RESIDENTIAL CUSTOMERS WOULD PICK OPTION OF COURSE.
OKAY. AND WE HAVE A QUESTION FROM COUNCIL MEMBER HARRIS.
AND I THINK YOU KIND OF STARTED ANSWERING SOME OF IT.
SO MY APS BILL THEY GIVE ME SOME OPTIONS.
IF I DO THIS, THEN THIS, IF I DO THIS, THEN THIS.
IS THAT AN OPTION FOR US WITH THIS, OR DOES THAT NOT GET US TO WHERE WE NEED TO GET.
BUT WE WOULD PUT THE, YOU KNOW, WE WOULD DECIDE WHAT YOU HAVE TO DO TO GET THIS.
DOES THAT MAKE SENSE? I BELIEVE SO, AND COUNCIL MEMBER HARRIS THAT'S NOT TYPICALLY WHAT HOW THE RATES ARE THE RATE STRUCTURES WORK FOR WASTEWATER.
SO WHEN YOU'RE SAYING IF WE DO THIS MEAN MEANING IF WE IF THEY WELL, THE CUSTOMER, THE CUSTOMER, THE CUSTOMER DOES THIS, THEN THEY MIGHT BE ABLE TO GET THIS RATE OR I DON'T KNOW IF THAT WORKS THE SAME WAY AS WITH ELECTRICITY.
YOU KNOW, IF I DO CERTAIN THINGS, THEN I GET WHATEVER IT IS THAT I GET IN THAT CLASS.
COULD YOU GIVE ME AN EXAMPLE OF WHAT I WOULD HAVE TO LOOK AT MY BILL TO TELL YOU? IS IT WHEN YOU USE ELECTRIC? I THINK IT'S WHEN I USE IT.
THAT SO I'M SO I'M JUST WONDERING IF THERE'S, IF THERE'S SOME OPTIONS FOR PEOPLE TO DO SOMETHING DIFFERENT IN ORDER TO REDUCE THEIR COST.
I DON'T KNOW. I MEAN, I'M JUST I'M LOOKING AT.
I'M JUST TRYING TO THINK OUTSIDE OF THE BOX HERE.
OUR, OUR WE'RE GOING TO NEED TO DO INFRASTRUCTURE.
BUT CAN SOME OF SOME OF US, DEPENDING ON OUR BEHAVIOR, HAVE TO PAY MORE THAN THOSE WHO BEHAVIOR MIGHT HELP US, I DON'T KNOW.
I BELIEVE. DO YOU SEE WHAT? I'M FOLLOWING YOU NOW? OKAY. AND ABSOLUTELY.
YES. AND IN FACT, THAT'S ONE OF THE BENEFITS OF USING AVERAGE WINTER WATER CONSUMPTION FOR RESIDENTIAL CUSTOMERS SEWER BILLS, BECAUSE IT REFLECTS THE THE WATER USAGE THAT'S RETURNING TO THE SEWER.
SO IF YOU ARE CONSERVING WATER IN THE WINTER, EVEN IF THAT'S IF YOU'VE MINIMIZED WHAT YOU USE INSIDE AND YOU REPLACE YOUR TOILETS AND YOUR APPLIANCES, THEN YOU'LL HAVE A REALLY LOW WINTER WATER USE.
AND THAT BENEFITS YOU FOR THE WHOLE YEAR SO YOU CAN GET THAT WAY.
AND LIKE WE TALKED ABOUT FOR THE PET FOOD MANUFACTURER, BY IMPROVING THE PRETREATMENT PROCESSES, THAT CUSTOMER IS, WE'RE SEEING LOWER STRENGTHS, THEREFORE A LOWER RATE.
[01:05:04]
BENEFIT THEM AND THEIR BILL.AND YOU COULD ALSO USE LESS WATER, WHICH TRANSLATES INTO LOWER SEWER BILLS.
OKAY. SO NOW WITH THAT BEING SAID, NOW I'M GOING TO PLAYED THE ADVOCATE HERE DEVIL'S ADVOCATE.
SO THEN WHAT DOES THAT DO TO THE AMOUNT OF MONEY WE NEED TO DO, THE THINGS WE NEED TO DO FOR INFRASTRUCTURE, OUR MAINTENANCE AND ALL OF THAT KIND OF STUFF.
AND THAT IS ONE OF THOSE DOUBLE EDGED SWORDS OF WATER CONSERVATION.
YOU NEED TO RECOVER A CERTAIN AMOUNT OF COSTS.
SOME COSTS ARE VARIABLE AND DO GO DOWN WHEN YOU'RE USING LESS WASTEWATER.
NO ELECTRICITY IS ONE OF THOSE EXAMPLES.
SO THERE MIGHT BE A SMALL REDUCTION.
BUT AS I MENTIONED AT THE BEGINNING OF THE MAJORITY OF THESE UTILITIES, COSTS ARE FIXED.
SO THE CUSTOMER MAY BE ABLE TO REDUCE SOME USAGE AND REDUCE BILLS.
BUT THEN AS WE WHEN YOU GO TO YOUR NEXT COST OF SERVICE STUDY, YOU MAY FIND THAT YOU HAVE TO STILL ADJUST YOUR RATES UPWARD TO RECOVER THOSE COSTS. OKAY.
ANY OTHER THOUGHTS ON THAT? MAYOR, COUNCIL MEMBERS, MEMBERS OF THE COMMISSION I'D LIKE TO COME UP WHEN THE DISCUSSIONS ARE HAPPENING BECAUSE THAT'S WHEN IT GETS EXCITING AS OPPOSED TO THE TABLES.
SO I'M JUST GOING TO TAKE A FEW MINUTES AND TRY TO FRAME MAYBE HOW I THE LENS, I SEE IT THROUGH.
AND SO AGAIN, STANTEC HAS DONE A GREAT JOB WITH THE DIRECTION OF THE COUNCIL TO IDENTIFY THE REVENUES THAT NEED TO BE RECOVERED THROUGH THE COST OF SERVICE OPTION ONE JUST DELINEATES THOSE COSTS ACROSS THOSE CLASSIFICATIONS, THOSE CUSTOMER CLASSES, AND OUR CREATIVITY AND OBJECTIVES THAT WE INTRODUCED TO THEM. WE ADD WE BEGIN TO ADD FACTORS INTO THE EQUATION.
SO OPTION ONE IS JUST TAKING THE INFORMATION WE PROVIDED SPREADING THAT ACROSS THE CUSTOMER CLASS.
OPTION TWO IS ABOUT THE BASE CHARGE.
SO THE BASE CHARGE IS WHERE WE TAKE A NUMBER.
IN THIS CASE 25% BASED ON WATER SERVICES POLICY [INAUDIBLE] WITH WATER SHOULDN'T RECOVER LESS THAN 25% OF THE REVENUE FROM BASE CHARGES, AND WE'RE APPLYING THAT TO WASTEWATER. THE 25% IS A FIXED NUMBER.
AS EARLY ON IN THE CONVERSATION, THERE ARE DIFFERENT LENSES THAT CAN LOOK THROUGH AS AS THE COMMISSION POINTED OUT, IF YOU'RE LOOKING AT BOND RATINGS, THEY WOULD PROBABLY LOOK MORE TO A 30%, RIGHT? THAT'S MORE AGGRESSIVE SHIFT TO THE FIXED COST.
SO I WOULD SAY 25% IS MORE CONSERVATIVE RIGHT THAN THE BOND RATING AND ALLOWS MORE REVENUE TO BE COLLECTED FROM THE VOLUMETRIC SIDE, WHICH IS THE CONTROL THE CUSTOMER HAS MY ABILITY TO USE LESS WATER.
FIXED COSTS, I DON'T HAVE ANY CONTROL OVER WHERE WE'RE SETTING THAT AT 25% THROUGH OPTION NUMBER TWO, AND YOU CAN SEE THE CAUSE AND EFFECT OF SHIFTING THOSE COSTS FROM THE USAGE AMOUNT TO THAT FIXED AMOUNT.
IF YOU DON'T USE A LOT OF WATER YOU ARE REAPING THAT SAVINGS, RIGHT? AND BY ADDING THE FIXED COST TAKES THAT CONTROL OUT AND IN A SENSE KIND OF DEVALUES THAT, THAT YOU USE ON LESS WATER BECAUSE WE'RE ADDING A FIXED RATE.
BUT IF YOU'RE USING MORE WATER, THAT BASE RATE NOT AS IMPACTFUL.
SO WHEN YOU LOOK AT THAT OPTION TWO I THINK TWO THINGS TO KEEP IN MIND IS WE'RE ADDING THE BASE RATE, AND WE'RE USING A 25% OF THE REVENUE RECOVERY TO SET THAT NUMBER, BECAUSE WE'RE ALSO EVEN MORE CREATIVE THAN THAT.
AND SO THAT'S ALSO BEEN THE DISCUSSION ABOUT WHERE THEY'RE AT IN THE SPECTRUM.
BUT IT DOES HAVE A CAUSE AND EFFECT THAT GOES THROUGH.
WE'RE MOVING THAT CONTROL AWAY FROM THE CUSTOMER AND SETTING IT AS A FIXED AS A BASE RATE.
SO HOPEFULLY THAT KIND OF FRAMED A LITTLE BIT I FEEL LIKE WHAT WE WERE MISSING.
[01:10:02]
AND WITH COUNCIL MEMBER HARRIS'S QUESTION IS NOT LOSING SIGHT OF THE FACT THAT WE'RE PROGRAMING 25%.THAT'S WHAT WE'RE TARGETING TO COLLECT UNDER THE BASE RATE.
SO HOPEFULLY THAT HELPED AND DIDN'T MAKE IT MORE COMPLICATED.
BUT THOSE ARE THE I THINK THE THREE OPTIONS AND THE DISTINCT DIFFERENCES BETWEEN THEM AS I SEE THEM.
WE'VE GOT A QUESTION OVER HERE.
YEAH. MY QUESTION IS IN ALL THESE OPTIONS, IT LOOKS LIKE THE RESIDENTIAL CLASS IS GOING TO BE ABSORBING THE GREATEST INCREASE. AM I NOT, I'M CORRECT IN THAT.
AND I'M JUST WONDERING FOR THE SINGLE FAMILY DWELLINGS, WE HAVE TIERED RATE STRUCTURE.
WHICH IS LIKELY, I'M NOT SURE, BUT IT CAUSED A LARGE DECREASE IN WATER USAGE OVER, YOU KNOW, THE LAST 20, 25 YEARS.
THE BASIS FOR THIS RATE STUDY IS IS LAST YEAR THIS YEAR CAN COMPARING TO FUTURE YEARS.
I'M TRYING TO BUT IT HASN'T CHANGED.
WE HAVEN'T CHANGED OUR RATES IN ABOUT FIVE SIX YEARS NOW CORRECT? THAT'S CORRECT. SO THE CONSERVATION DURING THAT PERIOD, WHATEVER EFFECT IT HAD AND SAY SOLIDS IN THE WASTEWATER, IF WE HAD A LARGE INCREASE IN SOLIDS IN THE WASTEWATER, THEN THAT WOULD CAUSE AN INCREASE IN THE SINGLE FAMILY DWELLING RESIDENTIAL RATE.
BUT IT'S KIND OF MUSHED IN WITH THE MULTIFAMILY TOO.
BUT SO I'M YOU KNOW, I COULD BE WRONG IN THIS.
I'M JUST CONSPIRACY THINKING OR SOMETHING.
DOES THAT MEAN WE'RE PUNISHING PEOPLE FOR CONSERVATION? MAYOR COUNCILWOMAN.
COMMISSIONER NAUMAN. NOT THAT WE'RE PUNISHING THE PEOPLE AGAIN.
IT'S ABOUT DETERMINING THE COST.
SO YOU'RE RIGHT. THROUGH CONSERVATION.
WHILE THE WATER IS DECREASE, THE LOADINGS HAS NOT.
AND SO I THINK INTERESTING TO THIS CONVERSATION IS OUR EXISTING RATES.
AND PRIOR I DID NOT TAKE INTO CONSIDERATION LOADINGS.
AND SO THOSE VALUES AND BE ABLE TO ASSESS THOSE ARE BEING ASSIGNED NOT PUNITIVE.
RIGHT. BUT AS THE COSTS OF SERVICE BEING ABLE TO DISTINCT TO WHAT'S THE COST TO TREAT THE WATER AND WHAT'S THE COST TO TREAT THE SOLIDS HAS BEEN APPLIED IN THESE SCENARIOS.
BECAUSE WE ADDED THAT LOADING COMPONENT RIGHT AT THE DIRECTION.
OKAY. SO HEAR THIS IN THE SPIRIT THAT IT'S GIVEN.
I ALWAYS HAVE TO PREFACE IT THIS MY COMMENTS SOMETIMES.
SO IS IT POSSIBLE THAT WE CAN LOOK AT OUR NEEDS, YOU KNOW, INFRASTRUCTURE, WAGES, SALARIES, CHEMICALS, WHATEVER IT IS THAT, THAT WE NEED.
HAVE WE LOOKED AT ALL THE DIFFERENT WAYS THAT WE CAN DO WHAT WE NEED TO DO STILL, MIGHT MAYBE HAVING TO HAVE TO RAISE RATES A LITTLE BIT, BUT CAN WE FIND A CHEAPER WAY, SOMETHING THAT WOULD COST US LESS BUT STILL KEEP MAINTAIN THE LEVEL OF SERVICE AND EVERYTHING THAT THAT WE WANT.
BUT ALL I'M ASKING IS THAT HAVE WE LOOKED AT EVERY POSSIBILITY AND MAYBE EVERY IS TOO STRONG OF A WORD, BUT HAVE WE LOOKED AT DIFFERENT POSSIBILITIES THAT MIGHT GET US THE SAME LEVEL OF SERVICE, BUT AT A LOWER COST OF OF OF RAISING RATES? AM I MAKING SENSE? DID I MAKE SENSE? YES.
NO I DO AGREE THAT I WOULD SAY THAT THAT IS WHAT WE HAVE DONE.
SO AGAIN, TALKING ABOUT THE EFFICIENCY.
BUT EVEN WHEN WE'RE WORKING WITH STANTEC AND APPLYING THE NUMBERS OF WHAT WE'RE PROJECTING ON COST I DO FEEL THAT WE TOOK A CONSERVATIVE WE TOOK A CONSERVATIVE MEASURE GOING BACK TO SOME OF THE ASSUMPTIONS IN THE MODEL.
LIKE SOME OF THOSE ARE CONSERVATIVE.
WHEN WE LOOK AT THE THE PROJECT COST THROUGH OUR CIP I FEEL THOSE ARE ALSO CONSERVATIVE.
[01:15:04]
THEY HAVE TO KNOW THAT WE DID ONE THROUGH 50 AND THIS IS STILL WHERE WE CAME OUT.BECAUSE I THINK THAT'S GOING TO HELP US.
AND SHOULD THEY BE A SMALL GENERATOR OR A LARGE GENERATOR? SHOULD WE SWITCH THIS ACCOUNT? AND SO, SO WATCHING WHAT THEY DO, THEY'RE LIKE, THAT'S ALMOST ON A MONTHLY BASIS WHERE THEY'RE LOOKING AT WHAT ARE THE CHARGES? HOW DO THEY FILL IN THE CLASSIFICATION? ONE IS OUR PROCUREMENT.
WHICH ISN'T ALWAYS EASY TO LIVE WITH RIGHT, GOING THROUGH THAT PROCUREMENT PROCESS, BUT KNOWING THAT THAT IS A NECESSITY, THAT WHEN WE MOVE FORWARD TO DO SOMETHING THAT WE DO SOLICIT INVITATIONS FOR BID, GETTING THOSE THREE QUOTES, TRYING TO GET THE BEST PRICE AND NOT AND NOT NOT MISSING THAT POINT AND GOING THROUGH THOSE, THOSE STUDIES AND APPRECIATIONS WHERE WE'RE LOOKING AT WHEN CHEMICAL COSTS GO UP, IS THAT THE RIGHT CHEMICAL? AND IF WE PIVOT TO A DIFFERENT CHEMICAL, WHAT'S THE RETURN ON THAT INVESTMENT? SO THIS YEAR WE SAW THAT WITH WITHIN WASTEWATER WHEN THE SUPPLIER FOR THEIR DICHLORINATION KIND OF CHANGED THE GAME AND WATCHING STAFF PIVOT DO A LOT OF WORK TO BRING IN BULK CONTAINERS AND, AND SHIFT CHEMICALS BECAUSE IT'S A GREATER VALUE.
WASN'T THE EASIER THING TO DO, RIGHT? IT WAS, BUT IT WAS A GREATER VALUE TO OUR CUSTOMERS TO TRY TO KEEP THOSE COSTS AT A MINIMUM.
THOSE ARE JUST A FEW, BUT I GET WHAT YOU'RE SAYING IS BEING ABLE TO HAVE THOSE THOSE INITIATIVES THAT I SEE STAFF APPLYING EVERY DAY TO, TO TRY TO MEET THOSE TO WORK WITHIN THEIR BUDGET AND MAKING SURE THAT WE GET THE BEST VALUE FOR THE COMMUNITY.
THANK YOU FOR MAKING THAT POINT, COUNCIL MEMBER HARRIS.
AND IT GETS TO THE POINT THAT I MADE AT THE RETREAT WHEN WHEN I SAID, I WANT US TO BE ABLE TO COMMUNICATE TO THE PUBLIC THAT EVERY SINGLE PROJECT IS ABSOLUTELY NECESSARY, AND THAT WE DID LOOK FOR THOSE EFFICIENCIES AND WE'RE NOT ASKING FOR MONEY FOR, YOU KNOW, AS SOME PEOPLE MIGHT DESCRIBE IT, PIE IN THE SKY TYPE OF PROJECTS THAT THAT WE'VE DONE THE RESEARCH AND WE KNOW THAT THESE ARE THE PROJECTS WE ABSOLUTELY HAVE TO GET DONE.
AND JUST TO ADD ON TO THAT, I MET WITH SOMEONE IN THE COMMUNITY TODAY AND THIS CAME UP AND I TO REALLY MAKE THIS EFFECTIVE IN COMMUNICATING.
I THINK IT WILL BE CRUCIAL WHEN THIS IS ALL SAID AND DONE, THAT WE HAVE REPORTS, WHETHER IT'S QUARTERLY OR TWICE A YEAR, ON YES, WE RAISE YOUR RATES, BUT HERE'S WHAT WE HAVE BEEN ABLE TO DO WITH THAT MONEY AND REALLY SPELL IT OUT FOR THE COMMUNITY.
I THINK YOU ALREADY DO THAT, BUT I THINK COMING TO COUNCIL AND DOING A TWO MINUTE, FIVE MINUTE REPORT SO THAT THE PUBLIC CAN REALLY HEAR IT AND SEE IT WOULD BE BENEFICIAL.
THANK YOU. I HAVE A QUESTION IN TRYING TO THINK ABOUT OR HOW WE SHOULD THINK ABOUT THE DISTINCTION BETWEEN OPTIONS TWO AND OPTIONS, OPTION THREE I THINK OPTION THREE JUST IS A AS FAR AS I KNOW.
IT'S JUST A STEP TAKEN TO SIMPLIFY THE RATE STRUCTURE AND SO FORTH.
AND CONCEPTUALLY, AGAIN, AS I MENTIONED BEFORE, I'M CERTAINLY FOR THAT.
BUT I WONDER IS, IS THIS REALLY, YOU KNOW, CATEGORIZING CUSTOMERS? IS THAT REALLY A SIGNIFICANT ADMINISTRATIVE BURDEN OR NOT IN THE SYSTEM? I, I WOULD ASSUME THAT ONCE A CUSTOMER IS CATEGORIZED, IT'S A CODING ON A COMPUTER SHEET, AND THAT THAT LASTS FOR YEARS AND YEARS.
AND ONCE THOSE ARE CODED, IT'S NOT REALLY A SIGNIFICANT DIFFERENCE.
SO SO DO YOU FEEL AS A DEPARTMENT, DO YOU FEEL A STRONG DRIVER BETWEEN OPTION TWO AND OPTION THREE? MAYOR, COMMISSIONER [INAUDIBLE].
EVEN THOUGH PEOPLE FALL INTO A CLASSIFICATION AND YOU THINK THEY STAY THERE, I WOULD SAY MY EXPERIENCE IS THAT'S NOT THE CASE, RIGHT? THAT COMES BACK UP IN CONSTANT CONVERSATION ABOUT WHY I'M DIFFERENT FROM OTHER CLASSIFICATIONS.
AGAIN, THAT YOU GO THROUGH THE PROCESS, YOU DEFEND IT, YOU WORK THROUGH THAT, BUT ALSO MORE IMPORTANTLY, THAT THESE ARE ALSO DYNAMIC MEANING LIKE SOMEWHERE ACROSS TOWN, THERE'S ANOTHER THERE'S ANOTHER NONRESIDENTIAL ESTABLISHMENT BEING CONSTRUCTED, AND EACH TIME IT COMES IN, IT HAS TO BE DETERMINED.
WHERE DOES IT FIT OR DOES IT BECOME ITS OWN CLASSIFICATION.
[01:20:02]
AND SO AGAIN, OUR INTENT OF PUTTING THOSE INTO HOW I WOULD FRAME IT AS KIND OF LIKE THIS LOW, MEDIUM OR HIGH.SO MAYBE THAT'S OVER SIMPLISTIC.
BUT WHEN I LOOK AT THE TYPE OF BUSINESS AND I CAN APPLY THAT TO SAY, WHERE DO YOU FALL IN THAT CATEGORY? THAT IS A SIMPLICITY, BUT ALSO KNOWING THAT THAT WE'RE CREATING AN OPPORTUNITY WHERE IF YOU AS THAT NONRESIDENTIAL IF YOU DISAGREE THAT WE'RE LOOKING TO HAVE THAT PROCESS TO SAY, WELL THEN LET'S RIGHT, LET'S PULL THE SAMPLES, LET'S TAKE A LOOK AT IT.
SO I THINK FROM WATER SERVICES STANDPOINT, I DO THINK IT IS WORTHWHILE, ESPECIALLY BECAUSE AGAIN, IN MY INTENT IS AS WE TALKED THROUGH, THE FINANCIAL PLANNING IS SOMETHING THAT OCCURS EVERY YEAR.
OUR ABILITY TO COME BACK QUARTERLY, TALK ABOUT THE PROJECTS, THE THINGS WE'RE ADJUSTING, BUDGET TIME, WE'RE LOOKING AT, THE NUMBERS THAT OCCURS AGAIN ANNUALLY, MULTIPLE TIMES THROUGH THE YEAR, THAT COST OF SERVICE TO SAY, ARE WE RECOVERING THE RIGHT REVENUE AND IS IT COMING FROM THE RIGHT CLASSIFICATIONS? OUR GOAL IS TO DO THAT EVERY THREE YEARS.
RIGHT. THAT'S OUR THAT'S OUR AMBITION THAT WE CAN DO EVERY THREE YEARS.
SO THE OTHER ADVANTAGE WE HAVE IS BECAUSE WE ARE HAVING THIS DISCUSSION NOW, IF THERE WAS A TIME TO CONSOLIDATE CHANCES ARE NOW IS THE TIME THAT YOU WOULD DO THAT, IF THAT MAKES SENSE. BECAUSE THERE MAY NOT BE AN OPPORTUNITY WHERE MAYBE SOME OF US OLD TIMERS HERE, WILL HAVE THAT CHANCE TO GO BACK INTO THE RATE STRUCTURE.
SO BECAUSE OF THOSE, I THINK WE DO GAIN SIMPLICITY FUTURE DEVELOPMENT COMES IN.
IT'S EASIER TO PLACE THEM IN THERE.
AND AGAIN, BECAUSE WE'RE GOING THROUGH THE RATE STRUCTURE.
IF THERE'S EVER A TIME TO KIND OF, YOU KNOW, KIND OF PULL THE BAND-AID OFF AND FIX ANYTHING THAT WE DO WANT TO FIX OR TAKE OPPORTUNITIES THAT WE CAN, I THINK THOSE ARE A FEW THINGS JUST FROM WATER SERVICES.
ON WHY WE THINK THERE'S A VALUE.
THANK YOU, THANK YOU. COUNCIL MEMBER HARRIS.
SURE THING. DID I SEE A KIND OF A WAVE OVER HERE? HALF HEARTED WAVE.
THIS IS ACTUALLY FOR YOU, SHANNON.
IN THE TREATMENT OF WASTE WATER.
WHERE WOULD THE BIGGEST BANG FOR THE BUCK COME IN TERMS OF TREATMENT AND TREATING THE SOLIDS? YOU KNOW, PURIFYING, YOU KNOW, AT THE END, MAKING SURE THE WATER WAS STERILIZED.
WHERE DO YOU GET THE BIGGEST BANG IN TERMS OF TECHNOLOGY? MAYOR. COMMISSIONER NORMAN, I THINK I'M PROBABLY A LITTLE BIT JADED RIGHT HERE RECENTLY, I WOULD SAY.
I MEAN, SO DEFINITELY SOLIDS HANDLING IS ON OUR RADAR AND EVERYTHING.
IT'S A BIG PART OF WHAT WE DO.
BUT WHEN YOU REALLY TALK ABOUT MOVING THE NEEDLE AGAIN, ELECTRICAL COSTS ARE A HUGE DRIVER.
AND AND ELECTRICITY IS WHAT DRIVES A LOT OF THAT TREATMENT.
SO I THINK CURRENTLY THOSE ARE I FEEL LIKE THOSE ARE THE TWO THINGS THAT KIND OF MAKE IT WORK.
OUR ABILITY. RIGHT. ELECTRICITY TO GET THE TREATMENT, MAKING SURE THE AIR IS RIGHT, THE BLOWER MAKING SURE YOU'RE PROCESSING THE SOLIDS IF YOU'RE NOT MOVING THE SOLIDS OUT AND THEY'RE STAYING IN YOUR SYSTEM LIKE THAT DOES NOT WORK WELL FOR YOUR SYSTEM.
I THINK THAT MIGHT BE A LITTLE BIT OUT OF THE SCOPE OF THE RATE STRUCTURE, BUT DEFINITELY IN LINE WITH SOME OF THE CONVERSATIONS WE'RE HAVING ABOUT WHAT IS THE NEXT STEP AND WHAT IS THE NEXT ITERATION.
THINGS LIKE OUR TREATMENT PLANT, FACILITY, MASTER PLAN SOME OF THE INNOVATION WORK THAT WE'RE DOING WITH SOME OF THE GRANT STUDIES AND OPPORTUNITIES THAT COME UP AND HOW WE ALIGN THOSE, I THINK IT DOES KIND OF SHAPE OUR FUTURE.
AND I'LL BE CONSTANT PART OF THAT CONVERSATION.
BUT WHEN IT COMES TO THE RATES AND THE AND THE NUTS AND BOLTS.
SO HOPEFULLY I'M KIND OF ANSWERING YOUR QUESTION.
YEAH. WHEN YOU'RE TALKING ABOUT CHALLENGES, MY MIND STARTS RACING FROM STAFFING AND ELECTRICAL COSTS AND CHEMICAL COSTS AND AND LIKE WHAT'S NOT WORKING TODAY AND WHAT ARE THE THINGS WE'RE TRYING TO DRIVE FORWARD CURRENTLY.
BUT. SO YOU'RE LOOKING FOR SOME DIRECTION? I WAS JUST JOINING IN THE CONVERSATION BECAUSE YOU'RE HAVING SO MUCH FUN.
I'M GOING TO TURN IT BACK OVER TO THE TEAM.
BUT YEAH, THANK YOU FOR ALLOWING ME TO DO THAT.
THANK YOU. MAYOR. THANKS, SHANNON.
WE ARE LOOKING FOR DIRECTION BEFORE WE TALK.
NEXT STEPS. I DO HAVE SOMETHING THAT I WANTED TO COMMENT ON THOUGH.
AS SHANNON MENTIONED, YOU DO YOUR COST OF SERVICE STUDY EVERY THREE YEARS.
[01:25:04]
YOU HAVEN'T REALLY HAD THIS IN-DEPTH LOOK SINCE, I THINK, 2009.BUT ONCE YOU ALIGN TO COST OF SERVICE THEN THE SUBSEQUENT YEARS CAN BE ACROSS THE BOARD INCREASES UNTIL YOU HAVE YOUR NEXT COST OF SERVICE STUDY. OR YOU DECIDE IF YOU WANT TO DIG DEEPLY AGAIN OR NOT.
SO ONCE THIS THIS DECISION IS MADE, ONCE YOU GIVE US DIRECTION ON WHICH RATE, DESIGN OR RATE STRUCTURE YOU PREFER, THEN 20, 26, 27, 28, EVEN DEPENDING ON HOW FAR YOU GO, IS AN ACROSS THE BOARD INCREASE TO THOSE RATES? AND JUST TO GIVE YOU A HEADS UP THAT THE FORECAST FOR 2026, WHICH AGAIN CAN BE MODIFIED AS WE GO THROUGH AND GAIN EFFICIENCIES AND LOOK AT WHAT'S REALLY NEEDED.
FISCAL YEAR 26 IS A 25% INCREASE, FISCAL YEAR 27 IS A 15%, AND THEN 28 WAS FORECASTED TO BE 10%, THEN DOWN TO FIVE. SO IT IS, YOU KNOW, DECREASING.
BUT THIS FIRST STEP IS IS REALLY IMPORTANT THIS ALIGNMENT WITH COST OF SERVICE.
SO I'D LOVE TO HEAR YOUR THOUGHTS ABOUT THESE OPTIONS.
AND IF YOU HAVE ANY TENDENCIES OR ANY FEELINGS.
LIKE I SAID AT THE BEGINNING, IF YOU'D PREFER TO WAIT TILL WE PRESENT THE WATER RATE STRUCTURE ALTERNATIVES ON THE 25TH, WE CAN COME BACK TO THIS, BUT I'D LOVE TO HEAR WHAT YOU HAVE NOW.
AND BEFORE I ASK FOR DIRECTION, AARON, I'M WONDERING IF YOU HAVE A SLIDE AND WE DON'T HAVE TO SHOW IT NOW IF YOU HAVE IT, BUT THE SUPPLEMENTAL THAT YOU SENT US TODAY, THERE WAS THE COMPARISON OF PER CAPITA WATER USE BETWEEN RESIDENTIAL AND MULTIFAMILY.
I'D LIKE TO PULL THAT UP AT SOME POINT, BUT WE CAN CONTINUE WITH OUR DIRECTION TO YOU AND WHETHER WE WANT TO GIVE DIRECTION TO YOU OR WAIT UNTIL WE HAVE THE OTHERS. SO, COMMISSIONERS AND COUNCIL MEMBERS, WHAT ARE SOME WHAT ARE SOME THOUGHTS? OH, I SEE THAT COUNCIL MEMBER MATTHEWS HAS A QUESTION.
THANK YOU. MAYOR CARROLL, I JUST WANTED TO CLARIFY YOUR LAST STATEMENT.
YOU SAID THAT WHAT WE'RE LOOKING AT RIGHT NOW JUST FOR WASTEWATER THESE RATE INCREASES IS JUST FOR 2025. AND THEN MOVING FORWARD IN 2026, WE'RE GOING TO SEE MORE INCREASES OVER THE NEXT FOUR YEARS.
BASED ON THE BASED ON THE FINANCIAL PLAN FROM BACK IN THE FALL.
OKAY, SO IT'S NOT JUST THIS IMPACT.
AND THEN THE NEXT YEAR IS AND WHAT'S THE INCREASE HERE BY THE WAY.
THAT'S CORRECT. THIS FIRST YEAR.
SO IT MAY NOT BE 25%, IT MAY BE LESS, IT MAY BE MORE.
BUT IN TOTAL IT'S A 25% INCREASE.
SO WOULD I BE CORRECT IN ASSUMING THAT WE WOULD LOOK AT THIS TO SEE THE FIRST YEAR IMPACT AND THEN ADD THAT ADDITIONAL INCREASE AGAIN.
THOSE SAME AMOUNTS, BASICALLY.
THANK YOU. THOUGHTS? CONCERNS? YES, PLEASE.
I'M RELATIVELY NEW TO THIS, SO FORGIVE ME FOR ASKING A QUESTION ABOUT PREVIOUS PRESENTATIONS, BUT YOU PRESENTED, I BELIEVE, IN OCTOBER OR MAYBE LATER THAN THAT. SOME ALTERNATE PLANS FOR LEVELIZED RATE INCREASES.
DOES THIS PRESUME ONE PATH OR THE OTHER WITH RESPECT TO LOCALIZING THE RATE INCREASES? MAYOR. COMMISSIONER IT DOES.
THIS IS REPRESENTS THE FULL CAPITAL IMPROVEMENT PROGRAM PLAN.
[01:30:06]
BUT TODAY WE'VE SPOKEN MOSTLY IN TERMS OF 2025.BUT I GUESS I'M TRYING TO GET THE PICTURE.
AND SO IS WHAT WE'RE SEEING TODAY.
ARE THERE SPECIFIC NUMBERS WE'RE SEEING TODAY REPRESENTATIVE OF THE LEVELIZED PLAN OR OR NOT? YOU'RE CALLING IT THE LEVELIZED PLAN, AND I'M NOT SURE THAT THAT WAS THE NAME OF THE PLAN.
SO OR IF THAT WAS A DIFFERENT PLAN I THINK WE'D LIKE TO PULL IT UP.
AND ACTUALLY IF YOU PULL UP THE ONE FROM FEBRUARY.
YOU CAN EVEN PULL UP FEBRUARY.
ACTUALLY, IT PROBABLY WOULD BE GOOD TO.
WHILE YOU'RE LOOKING. COULD I MAKE A POINT? I THINK EVERYTHING IS STABLE HERE.
THE ONLY THING THAT'S NOT STABILIZED HERE IS THE US DOLLAR.
SO YOU HAVE TO CONSIDER WHAT THE DOLLAR WILL BUY AND ONE OF THEIR PROBLEMS FOR FUTURE PROJECTS RE DRILLING WHEEL WELLS AND STUFF IS THE EXTREME COST.
AND WE COULD BE WE COULD BE IN LESS THAN TWO YEARS.
WE COULD BE BEHIND THE EIGHT BALL ON THIS SIMPLY BECAUSE THE DOLLAR DOESN'T BUY WHAT IT USED TO BUY.
AND SO I WANT YOU TO CONSIDER THAT.
AND AS I THINK THE RATES ARE MODERATE COMPARED TO THAT STATUTE, I THINK WE'RE JUST CATCHING UP.
AND I'M I BELIEVE THAT THIS IS A FAIR INCREASE NO MATTER WHICH WHICH OPTION YOU USE.
THE SLIDE THAT'S UP HERE NOW IS THE ONE THAT WAS PRESENTED IN OCTOBER.
AND IT SHOWS ACTUALLY THE FOUR SCENARIOS.
OKAY. AND THE RATES THAT WERE PRESENTING TONIGHT WERE BASED ON THE ALTERNATIVE OPTION.
WE'RE CALLING IT THE FULL FUNDED CIP.
GOOD. THANK YOU. THAT CONFIRMS WHAT I HOPED.
JUST A QUESTION BETWEEN OPTIONS ONE AND THEN DIFFERENCE BETWEEN 2 AND 3.
DO YOU THINK BY HAVING MORE OF A FIXED FEE OR MORE BASED ON WATER USAGE, THAT IT WILL AFFECT WATER USAGE GOING FORWARD IF IT'S PULLED MORE TO JUST THE FIXED, IS THAT GOING TO.
LOOSEN THE STRINGS SO PEOPLE USE END UP USING MORE.
DID THAT MAKE SENSE? SO FROM WHAT I HEARD, ARE YOU THINKING THAT IF THERE IS MORE OF THEIR BILL THAT'S BASED ON A FIXED CHARGE, THEN THEY MIGHT USE MORE WATER? YEAH.
I MEAN, ESSENTIALLY WE'VE WE OUR WATER USAGE AS A COMMUNITY HAS GONE DOWN.
YOU KNOW, WATER CONSERVATION AND ALL THAT BY SHIFTING THE FEE BACK TO MORE OF A FIXED.
IS THAT GOING TO HAVE THE OPPOSITE EFFECT? BECAUSE THE TOTAL BILL IS GOING UP, IT IS UNLIKELY.
SOME CUSTOMERS DON'T REALLY LOOK AT THE DETAILED PARTS OF THEIR BILL.
I KNOW I DO, BUT YOU KNOW SOME.
SO SOME CUSTOMERS JUST LOOK AT THAT TOTAL BILL AND IF IT'S GOING UP THEN THEY STILL WILL CONSERVE.
SO LIKELY ADDING THIS, I SHOULDN'T SAY LIKELY.
[01:35:03]
IT IS POSSIBLE THAT SOME CUSTOMERS MIGHT SEE THAT THEIR THEIR UNIT RATES GOING DOWN.SO MAYBE THEY WILL USE MORE WATER, BUT THEIR BILL IS STILL GOING TO GO UP.
SO I DOUBT THAT IT, YOU KNOW THAT IT WOULD CAUSE THAT REVERSE PRICE ELASTICITY RESPONSE.
SO I THINK THAT. HOPE THAT ANSWERS YOUR QUESTION.
OKAY. AARON, DID YOU HAVE SOMETHING TO ADD TO THAT? SORRY, I WAS JUST DOING SOME MATH IN MY HEAD ON THE.
WILL THEY SEE THE SAME REDUCTION IN THAT VARIABLE COST WITH THEIR WATER CONSERVATION? WHEN YOU'RE SAYING THE SAME.
THEY THEIR VOLUME BILL WILL GO DOWN A LITTLE BIT, BUT THEIR FIXED PART WILL STAY THE SAME.
SURE. SO THEY COULD REDUCE THEIR BILL BY CONSERVING IN THE WINTER.
YEAH, YEAH. NOT QUITE AS MUCH, RIGHT? NOT QUITE AS MUCH.
COMMISSIONERS AND COUNCIL THOUGHTS.
YOU KNOW, IN TERMS OF THE WATER SIDE OF THIS I DON'T I'M NOT FAMILIAR WITH WHAT WE'RE GOING TO DO IN TERMS OF RATE STRUCTURES AND, AND THAT THAT DECISION HAS BEEN MADE.
WHEN THAT DECISION DECISION IS MADE, HOW IS IT GOING TO AFFECT WHAT WE DECIDE TODAY? SO, MAYOR AND COMMISSIONER, WHEN WE ARE LOOKING AT THE SAY YOU DID PICK AN OPTION TODAY, THEN WE COME BACK TO YOU ON THE 25TH.
WE LOOK AT ALL THE WATER OPTIONS AND THEN WE CAN SHOW YOU THE COMBINED OPTIONS TOGETHER.
SO A COMBINED BILL, WATER PLUS WASTEWATER SO THAT IF A CUSTOMER'S BILL MAY BE GOING DOWN, MAYBE THEIR WATER BILL IS GOING UP AND THEN THE OVERALL INCREASE WILL BE A CERTAIN AMOUNT.
I'M JUST GIVING YOU AN EXAMPLE OF WHAT COULD HAPPEN.
SO WE WON'T KNOW UNTIL WE GO THROUGH THOSE WATER RATE OPTIONS WITH YOU, AND THEN COMBINE THE TWO OPTIONS BEFORE YOU KNOW THE THE FULL IMPACT ON A CUSTOMER. WOULD I BE CORRECT IN ASSUMING, THEN, THAT US CHOOSING ONE OF THESE OPTIONS IS AN ABSOLUTELY CRITICAL TODAY? BECAUSE WE COULD DO THAT AS PART OF THE LARGER CONVERSATION? MAIER I'D SAY YOU WERE CORRECT.
WELL. THANK YOU. I HAVE A NEIGHBOR WHO LIVES IN PHOENIX.
HE IS NEVER HERE IN THE IN THE WINTER, SO.
BUT HE'S UP HERE A LOT IN THE SUMMER.
SO BASED ON IF SINCE WE'RE BASING THE THE AMOUNT WE CHARGE FOR HIS WASTEWATER ON HIS WINTER USAGE HE'S GETTING A GOOD DEAL.
SO. AND OF COURSE, THE IDEA BEHIND IT IS PEOPLE AREN'T WATERING THEIR LAWNS IN THE WINTER.
SO I GUESS I TEND TOWARDS OPTION TWO BECAUSE IT'S MORE ACCURATELY REFLECTS THE USAGE OF VARIOUS CLASSES AS COMPARED TO OPTION THREE.
I MEAN, I'M NOT GOING TO FALL ON MY SWORD FOR OPTION TWO, BUT I GUESS OPTION TWO IS MY FIRST CHOICE.
OPTION THREE IS MY SECOND CHOICE, AND OPTION ONE WOULD BE MY LAST CHOICE.
THANK YOU. I'M FEELING LIKE I WOULD LIKE TO SEE ALL OF THE COSTS TOGETHER RATHER THAN MAKING SEPARATE DECISIONS, AND WE'LL SEE WHAT ELSE THE REST OF THE COUNCIL HAS TO SAY.
COUNCIL MEMBER MATTHEWS AND THEN COUNCIL MEMBER HOUSE.
I'M IN AGREEANCE WITH YOU, BUT I WOULD ALSO LIKE TO ADD TO THAT.
I'M A VISUAL, AND SO I WOULD REALLY LIKE TO SEE WHEN YOU SHOW THE COMBINED THE FINANCIAL IMPACT.
MODEL AND THEN SAYING, WELL, THIS IS HOW MUCH RESIDENTIAL WE'LL SEE AN INCREASE TOTAL.
AND THEN THE NEXT YEAR WHAT THEIR NEW BILL WOULD LOOK LIKE.
[01:40:04]
AND, AND OVER THE NEXT COUPLE OF YEARS.THANK YOU. MAYOR. I'M IN AGREEMENT WITH BOTH OF YOU.
I THINK IT'S THIS IS SOMETHING THAT'S REALLY IMPORTANT TO BE ABLE TO SEE THAT WHOLE PICTURE.
AND I, I LIKE THAT RECOMMENDATION FROM COUNCIL MEMBER MATTHEWS ON JUST HAVING THAT COLLECTED GRAPHIC REPRESENTATION OF WHAT THIS LOOKS LIKE HOLISTICALLY SO THAT WE'RE, WE'RE NOT MAKING DECISIONS PIECEMEAL.
BECAUSE RIGHT NOW, IT AND THIS IS NOT A CRITIQUE, BUT FOR ME, IT JUST FEELS VERY PIECEMEAL.
AND SO SEEING ALL OF THAT TOGETHER WOULD BE HELPFUL TO ME TO KIND OF PUT THOSE PIECES TOGETHER.
I KNOW IT'S BEEN A LOT AND I VERY MUCH APPRECIATE IT.
THANK YOU. COUNCIL MEMBER SWEET THANK YOU.
I AM ALSO IN AGREEMENT THAT I WOULD LIKE TO WAIT AND HAVE THE BROADER DISCUSSION.
SO I KNOW FOR ME, I GET HOME AND I RELOOK AT THIS AND HAVE MORE QUESTIONS.
AND I WOULD REALLY ADVOCATE FOR YOU ALL IF YOU HAVE THAT TO REACH OUT TO THEM.
I THINK THAT WOULD HELP ME AS WELL.
AND I APPRECIATE THE PRESENTATION AND YOUR TIME.
THANK YOU. SO IS THERE ANY DISAGREEMENT WITH THIS APPROACH? YES, PLEASE.
I DIDN'T WANT TO MISS MY OPPORTUNITY.
I'M NOT DISAGREEING WITH THE APPROACH, BUT I WOULD LIKE TO, IN ESSENCE.
SECOND, JIM MCCARTHY'S COMMENTS.
I THINK FOR ME, IT'S IMPORTANT TO ESTABLISH THE PRINCIPLE OF A BASE CHARGE ON THE WASTEWATER SIDE, JUST AS WE DO THROUGH A METER CHARGE ON THE ON THE POTABLE WATER SIDE. THE COSTS ARE FIXED.
A HUGE, HUGE PERCENTAGE OF THE TOTAL COST OF WASTEWATER TREATMENT ARE FIXED.
I THINK WE SHOULD REFLECT THAT TO SOME DEGREE, AT LEAST WITH THE BASE CHARGE.
IT ALSO ADDRESSES THE CONDITION OR THE THE CIRCUMSTANCES THAT JIM REFERRED TO WITH THE SECOND HOME OWNERS WHERE YOU KNOW, GIVING THEM A BASE CHARGE AT LEAST PARTLY MAKES UP FOR THE THEIR OWN UNEVEN USAGE THROUGH THE COURSE OF THE YEAR.
I WOULD HAVE EVEN SAID, LET'S CONSIDER A 30% BASE CHARGE ON THE WASTEWATER SIDE.
GIVEN THE COMMENTS ON WHAT THE BOND YOU KNOW, THE BOND RATING PEOPLE ARE LOOKING FOR.
BUT FOR ME, THAT WOULD BE IMPORTANT.
I'M SOMEWHAT INDIFFERENT BETWEEN OPTION TWO AND OPTION THREE.
GIVEN THE COMMENTS FROM SHANNON JONES.
SO I'M FAVORING OPTION TWO OR OPTION THREE.
THANK YOU. I'D SECOND ROB'S COMMENTS.
THANK YOU COUNCIL MEMBER MCCARTHY.
WELL, THIS COMMENT HAS NOTHING TO DO WITH THE DISCUSSION WE'RE HAVING RIGHT NOW, BUT I'D LIKE TO POINT OUT THAT THE LAST TIME THE CITY DID A RATE STUDY, I WAS ON THE WATER COMMISSION AND BOY, WE DID.
WE GOT INTO LIKE 5% AS MUCH DETAIL AS WE'RE DOING NOW.
SO ANYWAY, THANKS FOR ALL THE HARD WORK TO STAFF AND TO OUR CONSULTANT.
SO, COUNCIL MEMBER HARRIS, YOU HAD A COMMENT.
OKAY. SO THANK YOU SO MUCH FOR THE PRESENTATION.
TRY POTATO CHIPS BEFORE YOU DO IT THE NEXT TIME.
LET'S SEE IF THAT WORKS BECAUSE YOU'LL BE BACK.
ALL I WANT TO SAY IS THAT THIS IS NOT GOING TO BE THE FIRST THE, THE LAST ISSUE THAT WE HAVE TO ADDRESS IN TERMS OF WATER AND ANYTHING ELSE IN OUR CITY.
AND I'M GOING TO BE LIKE COUNCIL MEMBER MCCARTHY.
NOW, THIS MAY NOT BE DIRECTLY RELATED TO OUR DISCUSSION, BUT I LOOK AT THIS LIST OF PEOPLE WHO JOIN OUR MEETINGS AND I THINK I SEE ABOUT OH 8 TO 10 EXTERNAL PEOPLE.
SO I'M ASSUMING THAT THAT MEANS THAT THAT PEOPLE OUTSIDE OF THE CITY.
IS THAT RIGHT? CITY CLERK. YES.
AND SO I'M HOPING THAT THOSE FOLKS WHO ARE SITTING OUT THERE LISTENING TO THIS, THEY HAVE SOME REASON FOR LISTENING TO THIS OTHER THAN TO SEE US, YOU KNOW, DO WHATEVER IT IS THAT WE DO, BUT MAYBE THEY'RE INTERESTED.
AND SO I WOULD REALLY ENCOURAGE OUR COMMUNITY, YOU KNOW, YOU ALL HAVE A LOT OF EXPERIENCE OUT THERE.
[01:45:05]
SO I'M TALKING TO THE COMMUNITY NOW, THOSE THAT ARE OUT THERE AND TO STAFF AND TO ALL OF US SITTING UP HERE, WE CANNOT DO THIS JOB BY OURSELVES.I KEEP TELLING PEOPLE THAT THE SEVEN OF US DO NOT KNOW EVERYTHING, AND THE 100 OR 200 OR 300 STAFF MEMBERS THAT WE HAVE, THEY DON'T KNOW EVERYTHING.
THERE'S A LOT OF FOLKS IN THIS COMMUNITY WHO HAVE A LOT OF EXPERTISE.
AND THAT'S WHAT WE NEED PEOPLE TO DO BECAUSE THEY HAVE THE EXPERTISE THAT WE NEED.
AND SO I JUST FEEL LIKE I JUST NEED TO KEEP SAYING THAT TO GET PEOPLE INVOLVED.
BECAUSE I TELL YOU, WHEN I READ THIS STUFF AND I READ IT AGAIN, AND THEN I READ IT AGAIN AND I'M GOOGLING EVERYTHING BECAUSE THIS IS NOT AN AREA OF EXPERTISE FOR ME.
THIS IS NOT WHAT I DID FOR 40 YEARS.
OKAY. AND SO WE NEED FOLKS TO HELP US MAKE THESE KINDS OF DECISIONS AND BRING STUFF TO US.
WELL, NOT MUCH MORE, BUT IT'S GOING TO REALLY HELP OUR CITY.
AND SO I DON'T MEAN TO SIT UP HERE AND PREACH, YOU KNOW, BECAUSE I KNOW YOU ALL ALL KNOW THIS.
BUT I'M SO GLAD TO SEE JOE HERE.
I MET HIM AS A YOUNG MAN 20 YEARS AGO NOW, I THINK.
20. YEAH. AND SO IT'S NICE TO SEE HIM INVOLVED IN THIS.
AND THIS IS NOT A PAID POSITION.
THIS IS SOMETHING THAT YOU'RE VOLUNTEERING TO DO.
AND SO WE NEED OTHER FOLKS THAT WILL HELP US TO DO THIS.
SO ANYWAY, THAT'S ALL I'M DONE.
THE ADDENDUM THAT YOU SENT US.
WE DID PULL THE SINGLE FAMILY VERSUS A MULTI-FAMILY GALLONS PER CAPITA.
THE USAGE IS CLOSER TO 65 GALLONS PER PERSON PER DAY.
AND WE HAVE THE NUMBER OF GALLONS SOLD.
AND THIS IS FROM 28, 2017, IN EACH CATEGORY.
SO THAT'S HOW WE GOT THAT PER CAPITA RATE.
AND THEN WHERE WOULD WE PICK UP THE AMOUNT? SO SAY THEY LIVE IN AN APARTMENT BUILDING.
WHERE WOULD WE PICK UP THE AMOUNT USED FOR COMMON AREAS AND LANDSCAPING? SOME APARTMENT COMPLEXES, MAYOR AND COUNCIL HAVE AN IRRIGATION METER.
I CAN'T REMEMBER IF I BROUGHT THAT INTO THIS CALCULATION OR NOT.
SO I'D HAVE TO REPORT BACK AT OUR NEXT MEETING.
UNLESS TAMARA LAWLESS, IF SHE'S ON, SHE MIGHT KNOW, BUT.
AND I JUST WANTED YOU TO SHOW THIS, BECAUSE WE OFTEN SAY THAT DENSER DEVELOPMENT OR MULTIFAMILY DEVELOPMENT HAS A LOWER PER CAPITA WATER USE THAN SINGLE FAMILY.
AND SO THIS WAS JUST A PRETTY STARK DIFFERENCE.
AND SO I JUST WANTED TO SHOW IT AND LET YOU KNOW THAT I REALLY APPRECIATED THIS SLIDE.
MAYOR. I JUST WANTED TO TAKE A MOMENT TO THANK OUR WATER COMMISSION FOR BEING HERE WITH US.
IT'S IT'S UNUSUAL FOR US TO DO THIS.
THANK YOU FOR SITTING HERE WITH US.
REGARDING THE THE RATE, WHICH RATE OPTIONS YOU PREFER.
I'VE ALWAYS GRAVITATED TOWARDS OPTION TWO.
[01:50:03]
SO I'M VERY OPEN TO THAT.AND BEFORE THAT COMMENT, I WASN'T REALLY OPTION THREE WASN'T REALLY ON MY RADAR TOO MUCH.
AND I THINK I SAID SOMETHING SIMILAR DURING OUR LAST CONVERSATION.
THE THE EASE, THE SIMPLICITY OF IT WAS LOWER ON MY LIST OF CRITERIA THAN OTHER THINGS.
AND I KNOW NOT EVERYONE HAS WEIGHED IN AT THIS POINT, AND THAT'S FINE IF YOU DON'T, BUT IN PARTICULAR WITH THE WATER COMMISSIONERS WHO HAVEN'T SPOKEN, I JUST I WOULD LOVE TO GET, IF YOU'RE WILLING A READ OF THE ROOM, SO TO SPEAK, ON ON WHERE YOU'RE THINKING ON THIS AND WHAT YOU'RE, WHAT YOUR PRIORITIES ARE AND WHAT YOUR REASONING IS, IF YOU'RE WILLING TO SHARE THOSE WHO HAVEN'T SAID MUCH, ERIN AND CAROL, YOU WILL BE GIVING THE SAME PRESENTATION, RIGHT? THE WATER COMMISSION WILL BE HAVING THE SAME CONVERSATION THAT COUNCIL IS GOING TO HAVE.
IS THAT CORRECT? WELL, LET'S TALK ABOUT OUR NEXT STEPS, MAYOR.
YEAH. SO FOR WELL, WE DIDN'T PUT IN THE IN BETWEEN MARCH MEETINGS, BUT FOR MARCH 25TH WE'RE GOING TO GET BACK TOGETHER AND TALK ABOUT THE WATER RATE STRUCTURES.
THEN WE CAN HAVE THAT FULL DIRECTION FOR WATER AND WASTEWATER.
AND THEN IF WE NEED TO, WE HAVE SOME APRIL WORK SESSIONS THAT WILL BE COMING BACK.
WE HAVE A LOT OF REPORTS TO WRITE AND WELL, ONE DRAFT REPORT AND FINAL REPORT, BUT WE HAVE A REPORT AND THEN THAT NEEDS TO BE ABLE TO BE POSTED ON THE FOR THE APRIL 16TH NOTICE OF INTENTION TO ADOPT THE THE DIFFERENT RATES.
SO ON THE APRIL 16TH WHERE DOES THAT MEETING? IS THAT A PUBLIC MEETING? DOES THAT JUST GO OUT TO TO PEOPLE? WHAT'S THE APRIL 16TH? WHAT DOES WHAT IS THAT? IS IT JUST A PAPER NOTICE? I THINK IT'S A ADOPT A IS THAT OUR MEETING WHERE WE DO THAT? A FORMAL COUNCIL MEETING WHERE WHERE YOU WILL ADOPT A NOTICE OF INTENT TO CHANGE FEES FOR THE FIRST TIME.
OKAY. THE FIRST READ OF THE FINAL RATES AND FEES WILL BE JUNE 18TH AS A COUNCIL MEETING.
THE SECOND READ WILL BE JULY 2ND.
OKAY. IS THERE ANYTHING THAT WE'RE GOING TO DO BETWEEN APRIL 16TH AND JUNE 18TH? THERE COULD BE.
AND THAT'S IF ON JUNE 16TH, WE STILL HAVE WORK TO DO.
IF ANY OTHER POLICY TYPE ADJUSTMENTS COME INTO PLAY AND, AND THEN WE WOULD BE COMING BACK WITH THOSE REFINEMENTS IN, IN MAY. YEAH.
SO WE'RE HAVING A PUBLIC HEARING ON THE 18TH AND JULY 2ND, IS THAT RIGHT? CORRECT. TWO PUBLIC HEARINGS.
IS THERE ANY WAY THAT WE CAN DO A PUBLIC HEARING BEFORE JUNE 18TH? BECAUSE WHAT I'M THINKING IS THAT FOLKS ARE GOING TO BE LEAVING VACATIONS.
KIDS ARE OUT OF SCHOOL JULY 2ND RIGHT BEFORE 4TH OF JULY.
EVERYBODY'S HEADED OUT OF TOWN.
IS THERE ANY WAY THAT WE CAN DO SOMETHING ELSE BEFORE JUNE 18TH? AND THAT'S JUST FOR ME, TRYING TO GIVE OUR PUBLIC ENOUGH OPPORTUNITIES TO WEIGH IN ON THIS SO THAT PEOPLE AREN'T SAYING, WELL, YOU ALL SLIP THAT IN WHEN WE WERE ALL ON VACATION, I GUESS.
WELL, YOU KNOW, YOU ALL KNOW THAT'S WHAT'S GOING TO HAPPEN.
MAYOR AND COUNCIL MEMBERS BETWEEN APRIL AND JUNE, THOSE TWO DATES, WE WERE RELEASING THE FIRST DRAFT FOR REVIEW OF THE WHOLE REPORT. AND THEN WE HAVE A SECOND DRAFT COMING FORWARD.
AND CAROL'S TELLING ME THAT SHE BELIEVES THEY CAN WE CAN BRING THAT DATE UP FROM JUNE 18TH.
YES. SO THAT'S A REALLY GOOD RECOMMENDATION.
THAT WAY WE DO HAVE SOME PADDING BEFORE IF WE DO NEED THAT JULY 2ND DATE.
SO IT'S REALLY UP TO STANTEC AND THE ADMINISTRATIVE TIME REQUIREMENTS UNDER
[01:55:04]
STATUTE FOR THE PUBLIC NOTICES.WE HAVE A 60 DAY AND A 30 DAY PUBLIC NOTICE.
AND SO IF WE CAN DO THAT, WE ABSOLUTELY WILL.
AND WE'LL LET YOU KNOW NEXT MEETING WHAT THOSE DATES ARE.
AND I REALIZE NO MATTER WHAT WE DO, SOME SOME PEOPLE ARE GOING TO HAVE SOMETHING TO SAY ABOUT IT.
SO THEY'LL THEY'LL SAY WHATEVER THEY SAY, BUT I DON'T WANT US TO BE CAUGHT NOT BEING PREPARED.
SO WE HAVE A RESPONSE, AN APPROPRIATE RESPONSE.
ANYTHING IN CLOSING? THIS IS IT. NEXT STEPS.
THANK YOU, EVERYONE, FOR BEING HERE AND BEING A PART OF THIS DISCUSSION.
AND WE'RE ADJOURNED.
* This transcript was compiled from uncorrected Closed Captioning.