2017_09-26_PWETCpacket - Laserfiche WebLink

Home

Roseville Public Works, Environment and Transportation Commission Agenda Item Date: September 26, 2017 Item No: 5 Item Description: Utility Base Rate Discussion Background: The City Council earlier this year directed staff to present a proposal to the Finance Commission and the Public Works, Environment and Transportation Commission to reduce the residential base fee for the water utility. The concept is that reducing the base fee will reduce the overall cost per gallon for water, particularly for low volume users. The Finance Commission discussed this briefly at their September meeting but requested more information from staff related to overall usage per meter size/land use. There are many calculations and methodologies that can be used to determine the tiers for the base fee per defined use. The City has long used the size of the meter to delineate the tiers for the base fee and/or consumption rates. Currently the City uses the fee structure as shown in Attachment A. The Finance department has presented a proposal to redistribute costs by reducing the base rate for residential users by 10% and increasing the rates for the other meter sizes by 54%, which is what would be necessary to in order to maintain current revenue. This is shown in Attachment B. The Public Works department has calculated base rates based on the maximum potential flow of various meter sizes as compared to a 5/81h inch meter (which the standard residential meter size). This is shown in Attachment C. This represents some very significant rate increases for the larger meter sizes. The goal of this discussion would be to reduce the base rate to residential users but maintain the overall annual revenue at or near current levels. Staff will present the attached material and seek input from the Commission on whether or not more costs should be shifted to commercial users in order to provide a more stable and "fair" cost to residential users. Recommended Action: Receive presentation and provide input on reducing the residential water utility base rate. Attachments: A: Current City Utility Rates B: Proposed Base Rates for 10% Residential Reduction C: Proposed Base Rates based on Proportional Flow (based on pipe size)