1. March 12 th, 2013 Stormwater Rate Structure Discussion

2. How did we get here? 2 Stormwater Rate Structure Discussion

3. April 2008  Previous ordinance legally challenged April 2011  New stormwater ordinance adopted 2012  Rate Design Study completed by Public Resources Management Group Inc. (PRMG) September 2012  Council adopted stormwater budget of $7.6 million December 2012  New rate approved by council of $11.65 per ERU No change in structure Increase went into effect January 1, 2013 Council requested time to evaluate options and develop comments and questions for consideration by consultant History of Rates 3 Stormwater Rate Structure Discussion

4. DescriptionBudget Projected Operating Results System-wide Facility Costs$3,100,000 Swale Maintenance3,100,000 Drainage Improvements1,400,000 Sub-total Annual Expenditures$7,600,000 Existing Operating Conditions: FY 2013 4 Stormwater Rate Structure Discussion

5. FSA Storm Water Utility Survey (2011 Edition) What is the general basis for your fee? A. Impervious area (67 respondents) B. Both gross area and impervious area (6 respondents) C. Gross area with intensity of development factor (3 respondents) D. Other (5 respondents) 83% Billing Approach 85% by User Fees 15% by Special Assessments City Uses Impervious Area Method Recognized Fee Methods 5 Stormwater Rate Structure Discussion

6. Base Case – As presented: Budgeted $11.65/month per ERU for the Current Service Area only Alternatives including Extended Service Area (City-wide) System-wide Approach (No service level reductions) Alternative I – Similar to existing method. All costs allocated per ERU. Alternative II – All costs allocated per Parcel. Alternative III – All costs allocated per Acre. Cost Apportionment Approach (Fee based on service level) Alternative IV – Base Fee All Properties per ERU / Drainage & Swale Fees per ERU Alternative V – Base Fee All Properties per Parcel / Drainage & Swale Fees per ERU Alternative VI – Base Fee All properties per ERU / Drainage & Swale Fees per Parcel Cost Recovery Alternatives - Revisited 6 Stormwater Rate Structure Discussion

7. Allocates Expenditures by Type: Base Fee: Recovered from all properties within the Comprehensive Management Area (City Limits) Includes all properties within the Extended Benefit Area Drainage Fee: Recovered from all properties within the Current Service Area only; except vacant commercial properties. Excludes all properties within the Extended Benefit Area. Swale Maintenance Fee: Recovered from all properties within the Current Service Area only; except vacant commercial properties and those single family residential properties that are not served by swales. Excludes all properties within the Extended Benefit Area. Cost Apportionment Approach – Revisited (Applies to Alternatives IV to VI) 7 Stormwater Rate Structure Discussion

8. 8 Two Possible Approaches Bring back consultant to re-evaluate proposed rate structure alternatives Address the one largest inequity

9. Inequities in Current Rate Structure Approximately 127 properties out of 474 were not eligible for a reduced service credit Within 50 feet of a drainage structure or facility Reduced service credits were for 70% or 95% If a reduced service credit was extended to these properties this would reduce revenue by approximately $200,000 or by approximately 294 billable ERU. Vacant Parcels > 1 Acre 9 Stormwater Rate Structure Discussion

10. 10 Questions & Discussion