Laserfiche WebLink
REQUEST FOR COUNCIL ACTION <br /> Date: October 24. 2021 <br /> Item No.: 7.a <br />Department Approval City Manager Approval <br /> <br />Item Description: Receive update on under billing of water customers <br />1 B ACKGROUND <br />2 In 2020, a Utility Rate Study was conducted which recommended new tiered water rates. The City <br />3 Council approved implementing the new tiered water rates for 2021 at the December 7, 2020 council <br />4 meeting. Tiered water rates for 2022 were approved at the December 6, 2021 council meeting. The <br />5 following chart shows the tiered rates that were approved for both of these years. <br />6 <br />20212022 <br />Water Usage Rate CategoryRateRate <br />SF Residential: Up to 15,000 gals./qtr$ 3.18$ 3.34 <br />SF Residential: 15,001 to 30,000 gals./qtr 3.98 4.18 <br />SF Residential: Over 30,000 gals./qtr (winter rate) 4.98 5.23 <br />SF Residential: Over 30,000 gals./qtr (summer rate) 4.98 5.23 <br />Apartments: Up to 8,000 gals/unit/qtr 3.18 3.34 <br />Apartments: 8,001- 15,000 gals/unit/qtr 3.98 4.18 <br />Apartments: Over 15,000 gals./unit/qtr 4.98 5.23 <br />Commercial: Up to 60,0000 gals./qtr 3.18 3.34 <br />Commercial: 60,001 to 400,0000 gals./qtr 3.98 4.18 <br />Commercial: Over 400,000 gals./qtr 4.98 5.23 <br />Irrigation Water Usage 4.50 4.73 <br />Rates are per 1,000 gallons <br />7 <br />8 <br />9 During the process of gathering data for an updated Utility Rate Study in 2022, staff discovered that the <br />10 tiered water rates were not entered correctly in 2021 into the water billing software for residential and <br />11 commercial accounts. Residential and commercial accounts were billed for their water consumption but <br />12 it was calculated at the lowest tiered water rate (Up to 15,000 gallons used per quarterfor residential). <br />13 Thus, less revenue was collected than expected. The tiered rates were corrected for the utility bills that <br />14 were issued at the end of September 2022. <br />15 <br />16 Staff have been working on identifying the magnitude of the amounts that would have been collected had <br />17 the tiered rates worked correctly. For residential accounts the total impact from January 2021 through <br />18 August 2022 is $279,985. The following chart shows the number of active accounts that were impacted <br />19 and breaks the amounts under billed into various dollar ranges. The chart also shows how much is related <br />20 to 2021 calendar year usage and 2022 calendar year usage, until the system was fixed. <br />21 <br />Page 1 of 3 <br /> <br />