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Attachment C Finance Commission Minutes November 10, 2020 Î Draft Minutes Page 2 of 4 46 sufficient capital costs to make sure all capital costs are covered because in Option Two the City 47 is adding $900,000 in WAC fees. He thought it was important to get that part right. 48 49 Ms. Vogt indicated with a fully developed community like Roseville where WAC fees are not 50 being charged because there is not development enough to support that, is the reason why two 51 different options were looked at. Option one does not include capital costs and would become 52 part of the usage charges and where that revenue would come in and add a little more volatility 53 because it would not be covered in the fixed costs, which is why Option two was also looked at. 54 Option two would add that stability to cover capital costs or $900,000 a year because the City 55 does not have WAC fees coming in and are not charged. Either option is right. Option one is 56 based on industry standards per the American Water Works Association but Option two tailers it 57 a little bit more towards Roseville because the City is fully developed, so that can include capital 58 costs into those fixed charges. 59 60 Chair Murray thought it seemed that if water conservation really worked Option one would find 61 the City short in the capital contribution account. 62 63 Ms. Vogt indicated that was possible but the flip side of that though is that while conservation 64 tends to be more effective quicker when the billing is monthly rather than quarterly. With 65 quarterly billing it tends to take residents longer to remember that the water bill is going to go up 66 in the summer. 67 68 Chair Murray asked if the City could do direct debit for water billing. 69 70 Ms. Pietrick indicated that can be done. 71 72 Ms. Cynthia White appreciated the presentation, and a great job was done. She explained she 73 has lived in California and has a deep appreciation for costing water to charge more to high 74 usage users and she was in the habit of going out daily to read her water meter in order to 75 understand whether that was a day she could use her dishwasher or do laundry. What she did not 76 see in the impact analysis of them having the bonding dollars attributed to the residents. Some of 77 the residents will save money on water bills, there will still be money that needs to be paid for 78 the Bond and she did not see that factored in. 79 80 Ms. Vogt explained it is factored in as part of the total amount of revenue that the City needs to 81 generate each year to pay for debt service, however it is not in the fixed costs, it is in the variable 82 costs. 83 84 Ms. Cynthia White asked where that is cost so the residents can see how that impacts them even 85 though the water bill will go down, there will be some other costs. 86 87 Ms. Vogt indicated there will not be any other costs for the residents. 88