The URL can be used to link to this page

Home My WebLink About2024-04-23 Finance Committee Action MinutesFINANCE COMMITTEE ACTION MINUTES Page 1 of 4 Special Meeting April 23, 2024 The Finance Committee of the City of Palo Alto met on this date in the Community Meeting Room and by virtual teleconference at 5:30 PM. Present In Person: Burt (Chair), Lauing, Veenker Present Remotely: None Absent: None CALL TO ORDER Action Items 1. Adoption of a Resolution Amending Utility Rate Schedule D-1 (Storm and Surface Water Drainage) Reflecting a 2.6% Consumer Price Index Rate Increase to $17.20 Per Month Per Equivalent Residential Unit for Fiscal Year 2025 MOTION: Council Member Veenker moved, seconded by Vice Mayor Lauing to recommend that the City Council adopt the attached resolution amending Utility Rate Schedule D-1 (Storm and Surface Water Drainage), to implement a 2.6% rate increase consistent with the applicable Consumer Price Index, increasing the monthly charge per Equivalent Residential Unit (ERU) by $0.44, from $16.76 to $17.20 for Fiscal Year 2025. MOTION PASSED: 3-0 2. Recommendation to the City Council to Adopt a Resolution: 1) Approving the FY 2025 Wastewater Collection Utility Financial Plan, Including Approval of a Short-Term Loan from the Fiber Optics Fund Reserve to the Wastewater Collection Fund Operations Reserve for FY 2024 and 2) Amending Rate Schedules S-1 (Residential Wastewater Collection and Disposal), S-2 (Commercial Wastewater Collection and Disposal), S-6 (Restaurant Wastewater Collection and Disposal) and S-7 (Commercial Wastewater Collection and Disposal – Industrial Discharger). MOTION: Vice Mayor Lauing moved, seconded by Council Member Veenker to recommend that the City Council adopt a resolution (Attachment A): ACTION MINUTES Page 2 of 4 Finance Committee Meeting Action Minutes: 4/23/2024 1. Approving the Fiscal Year (FY) 2025 Wastewater Collection Financial Plan (Attachment A, Exhibit 1), including approval of a short-term loan from the Fiber Optics Fund Reserve to the Wastewater Collection Fund Operations Reserve not to exceed $3,000,000 for FY 2024; and 2. Increasing Wastewater Collection Utility Rates Via the Amendment of Rate Schedules S- 1 (Residential Wastewater Collection and Disposal), S-2 (Commercial Wastewater Collection and Disposal), S-6 (Restaurant Wastewater Collection and Disposal) and S-7 (Commercial Wastewater Collection and Disposal – Industrial Discharger) (Attachment A, Exhibit 2). MOTION PASSED: 3-0 3. Finance Committee to Review and Recommend that City Council Adopt a Resolution Approving the Fiscal Year 2025 Water Utility Financial Plan, and Increase Water Rates by Amending Rate Schedules W-1 (General Residential Water Service), W-2 (Water Service From Fire Hydrants), W-3 (Fire Service Connections), W-4 (Residential Master-Metered and General Non-Residential Water Service), and W-7 (Non-Residential Irrigation Water Service) as Recommended by the Utilities Advisory Commission MOTION: Vice Mayor Lauing moved, seconded by Council Member Burt to recommend that the City Council adopt a resolution (Attachment A) for the FY 2025 Water Utility rates: 1. Approving the Fiscal Year (FY) 2025 Water Utility Financial Plan (Attachment A, Exhibit 1) as modified to reflect SFPUC's April rate increase notice, and by increasing use of reserve funds in FY 2025 to limit the overall system average water rate increase to 9.5% while reducing reserve funds available in FY 2026 and future years; and 2. Amending the following rate schedules to reflect increases effective July 1, 2024 (FY 2025) (Attachment A, Exhibit 2), as modified consistent with item 1 above: a. W-1 General Residential Water service, b. W-2 Water Service from Fire Hydrants, c. W-3 Fire Service Connections, d. W-4 Residential Master-Metered and General Non-Residential Water Service, and e. W-7 Non-Residential Irrigation Water Service MOTION PASSED: 3-0 4. Finance Committee to Review and Recommend to the City Council to Adopt a Resolution Approving the Fiscal Year 2025 Gas Utility Financial Plan, Including the General Fund Transfer, and Amending Rate Schedules G-1 (Residential Gas Service), G-2 (Residential Master-Metered and Commercial Gas Service), G-3 (Large Commercial Gas Service), and G- ACTION MINUTES Page 3 of 4 Finance Committee Meeting Action Minutes: 4/23/2024 10 (Compressed Natural Gas Service) as Recommended by the Utilities Advisory Commission MOTION: Vice Mayor Lauing moved, seconded by Council Member Veenker to recommend that the City Council adopt a resolution (Attachment A): 1. Approving the fiscal year (FY) 2025 Gas Utility Financial Plan (Attachment A, Exhibit 1), which includes amending the Gas Utility Reserve Management Practices (Attachment A, Exhibit 2); and 2. Amending Rate Schedules; a. G-1 Residential Gas Service, b. G-2 Residential Master-Metered and Commercial Gas Service, c. G-3 Large Commercial Gas Service, and d. G-10 Compressed Natural Gas Service) (Attachment A, Exhibit 3; and 3. Transferring up to 11.9% of gas utility gross revenues received during FY 2023 to the General Fund in FY 2025. MOTION PASSED: 3-0 5. Finance Committee to Review and Recommend to the City Council to Adopt a Resolution: 1) Approving the Fiscal Year (FY) 2025 Electric Financial Plan and Accepting the 2024 City of Palo Alto Electric Cost of Service and Rate Study, and 2) Amending E-1 (Residential Electric Service), E-2 (Residential Master-Metered and Small Non-Residential Electric Service), E-2-G (Residential Master-Metered and Small Non-Residential Green Power Electric Service), E-4 (Medium Non-Residential Electric Service), E-4-G (Medium Non-Residential Green Power Electric Service), E-4 TOU (Medium Non-Residential Time of Use Electric Service), E-7 (Large Non-Residential Electric Service), E-7-G (Large Non-Residential Green Power Electric Service), E-7 TOU (Large Non-Residential Time of Use Electric Service), E-NSE (Net Metering Net Surplus Electricity Compensation), and E-EEC (Export Electricity Compensation) as Recommended by the Utilities Advisory Commission MOTION: Council Member Veenker moved, seconded by Vice Mayor Lauing to recommend that the City Council Adopt a Resolution (Attachment A): 1. Accepting the 2024 City of Palo Alto Electric Cost of Service and Rate Study (Exhibit 1) 2. Approving the FY 2025 Electric Financial Plan (Exhibit 2), which includes the following actions: a. Amending the Electric Utility Reserves Management Practices (Attachment B), to direct staff to transfer to the CIP reserve, at the end of each fiscal year, any budgeted capital investment that remains unspent, uncommitted, and which is not proposed for reappropriation to the following fiscal year and to clarify how the Cap and Trade Program Reserve is adjusted each year. b. Approving the following transfers at the end of FY 2024: i. Up to $20 million from the Electric Special Projects Reserve to the Supply Operations Reserve; ACTION MINUTES Page 4 of 4 Finance Committee Meeting Action Minutes: 4/23/2024 ii. Up to $17 million from the Supply Operations Reserve to the Hydroelectric Stabilization Reserve; iii. Up to $58 million from the Supply Operations Reserve to the Distribution Operations Reserve; and c. Approving the following transfers in FY 2025: i. Up to $26 million from the Distribution Operations Reserve to the Supply Operations Reserve; ii. Up to $30 million from the Supply Operations Reserve to the Electric Special Projects Reserve; and iii. Up to $5 million from the Distribution Operations Reserve to the CIP Reserve; 3. Amending the following rate schedules effective July 1, 2024 (FY 2025), (Exhibit 3): a. Changing retail electric rates E-1 (Residential Electric Service), E-2 (Small Non- Residential Electric Service), E-4 (Medium Non-Residential Electric Service), E-4 TOU (Medium Non-Residential Time of Use Electric Service), E-7 (Large Non- Residential Electric Service), and E-7 TOU (Large Non-Residential Time of Use Electric Service) by varying percentages depending on rate schedule and consumption with an overall revenue increase of 0.5% effective July 1, 2024; b. Decreasing the Net Surplus Electricity Compensation (E-NSE-1) rate to reflect 2023 avoided cost, effective July 1, 2024; and c. Decreasing the Export Electricity Compensation (E-EEC-1) rate to reflect current projections of FY 2025 avoided cost, effective July 1, 2024; d. Updating the Residential Master-Metered and Small Non-Residential Green Power Electric Service (E-2-G), the Medium Non-Residential Green Power Electric Service (E-4-G), and the Large Non-Residential Green Power Electric Service (E-7- G) rate schedules to reflect modified distribution and commodity components, effective July 1, 2024. MOTION PASSED: 3-0 6. Receive and Discuss the Palo Alto Transportation Management Association (PATMA) 2023 Annual Report, Strategic Plan, and Commute Survey No action taken. Adjournment: The meeting was adjourned at 10:20 P.M.