Presentation on theme: "Operating Plans and Rates"— Presentation transcript:
1Operating Plans and Rates City of InglewoodWater and Sewer Rate DiscussionOperating Plans and RatesPublic Works Department
272 five-gallon water bottles What is HCF?HCF refers to Hundred Cubic Feet.It’s how we measure water usage.So, what does it really mean?The average residence uses 15 HCF per month, which is…11,220 gallons of water, orAbout 360 gallons of water per day. This is equivalent to…Areas of usage…72 five-gallon water bottles
3Why the Increase in Rates? The last rate increase was in 2003, and it was less than 3%.The system on average brings in $338,000 per month less than what it costs to operate.The proposed March increase only allows us to breakeven, and the October increase lets us begin repairs.As a comparison, in February the City of Los Angeles approved an increase of 14% for residential and 12% for commercial customers. Cumulatively, rates have increased 70% since 2003.
4Proposed Water Rate Increase—Issues Raised Is this a hidden tax increase?No, this is not a tax.The cost the City pays for water has continually increased, and the City’s General Fund can not subsidize the cost.There is nothing secret or hidden.The City is following Proposition Notice has been sent to all water customers as prescribed by law. Furthermore, notice was published in the local newspapers and placed on the City’s Website. Finally, today is the public hearing on the matter.
5Proposed Water Rate Increase—Issues Raised Is the typical residential increase 58%?No! It’s 28% and 12%.While the proposed water rate increases for a typical household are approximately 28% ($14) and 12% ($6.60) over the next two fiscal years (March and October), some households may see higher rates because the new tiered rates charge low-volume users less than high-volume users.NOTE: The proposed rates are still 10% less than what Golden State Water charges, which is 57% higher than our current rate and slated to increase again in July of 2012.
7Water Bill Comparison: Inglewood vs. GSW Current February 2012ItemsInglewood CustomerGolden State Customer3/4" meter$9.00$21.40Water Use (15 hcf)$38.35$44.48Utility Tax / City Tax$4.74$7.16California PUC Fee$0.00$1.07Surcharge$5.75Total$52.09$79.86Proposed March 2012ItemsInglewood CustomerGolden State Customer3/4" meter$12.00$21.40Water Use (15 hcf)$48.00$44.48Utility Tax / City Tax$6.00$7.16California PUC Fee$0.00$1.07Surcharge$5.75Total$66.00$79.86Both consume 15 hundred cubic feet of water each month.
8Water Bill Comparison: Inglewood vs. GSW Current February 2012ItemsInglewood CustomerGolden State Customer3/4" meter$9.00$21.40Water Use (15 hcf)$38.35$44.48Utility Tax / City Tax$4.74$7.16California PUC Fee$0.00$1.07Surcharge$5.75Total$52.09$79.86Proposed March 2012ItemsInglewood CustomerGolden State Customer3/4" meter$12.00$21.40Water Use (15 hcf)$48.00$44.48Utility Tax / City Tax$6.00$7.16California PUC Fee$0.00$1.07Surcharge$5.75Total$66.00$79.86$3$10$1.25$14Both consume 15 hundred cubic feet of water each month.
9Proposed Water Rates for October (FY 2012-2013) Inglewood vs. GSWProposed October 2012ItemsInglewood CustomerGolden State Customer3/4" meter$13.50$23.20Water Use (15 hcf)$52.50$55.86Utility Tax / City Tax$6.60$8.59California PUC Fee$0.00$1.07Surcharge$5.75Total$72.60$94.47$6.60
10In general, the area north of Century Blvd In general, the area north of Century Blvd., is served by the City, and south of Century Blvd., is served by Golden State Water.
11Comparisons Inglewood Rates vs. Golden State Water (GSW) Rates Inglewood CurrentInglewood March 2012Inglewood October 2012GSWCurrentGSWProposed
12Proposed Water Rate Increase—Issues Raised We need to defer some of these water system upgrades for a few more years until the economy picks up. This is not prudent nor advisable. This would be catastrophic depending on transmission or distribution line failure and could result in non-availability of water for several days. Additionally, since most of the pipes are 40 to 50 years old and far beyond their useful life, water quality is a big concern.
13Proposed Water Rate Increase—Issues Raised The money required to build the wells can be used from the $8 million water reserve account and the $2.1 million current 2011/2012 budget line item for design and construction of two (2) wells. There is no $8 million water reserve account. There was a beginning fiscal year fund balance of $6 million. If no rate increase is approved, there will be a deficit of $3.4 million by September 30, 2012.
14Proposed Water Rate Increase—Issues Raised The City sold 2,000 acre feet of water rights at $70 per acre foot, and we are buying water at $964 per acre foot resulting in a loss of $1.8 million. This is not a valid comparison. The water rights lease at $70 per acre foot is for raw water from the ground. The costs to pump it, treat it (e.g., make it usable), and transport to your home are not included. The City pumps, treats, and transports water at a cost of $700 per acre foot. Without the necessary infrastructure, the City is forced to buy water at a higher price.
15Water System Condition Water pipelines and fittings were built in 1940 – 1990.We have exceeded the expected life of pipes and fittings.30 miles of pipes are cast iron and need to be replaced.Water breaks occur in each area due to aging pipes.Leaks in different areas result in city water losses.We need to do pipeline replacement in conjunction with street projects.
18Water System Improvement Plan Conservation Additional technologies are required to improve the system.Improvement projects are outlined in the water master plan.ConservationReplacement and improvement projects are needed to meet the water conservation plan in and 2020.Defective pipes, fittings, meters and other water transmission- related items will increase water losses.
19Sewer System Overview Built in the 1920s. We have exceeded the expected life of the sewer pipes.Some pipe segments are lined but many areas have big cracks and holes, and need to be replaced.Approximately 150 miles of sewer pipe and 3,635 manholes need improvement.City spends an average of $1 million a year to maintain the system.