Loading...
HomeMy WebLinkAboutStaff Report 205-09TO: FROM: ATTENTION: DATE: SUBJECT: BUDGET FY 2010 -FY 2011 HONORABLE CITY COUNCIL CITY MANAGER FINANCE COMMITTEE APRIL 21, 2009 DEPARTMENT: UTILITIES CMR: 205:09 Utilities Advisory Commission Recommendation that Finance Committee Recommend Council Adoption of a Resolution Amending Utilities Rate Schedules C-1, E-16, and W-2 RECOMMENDATION Staff and the Utilities Advisory Commission (UAC) recommend that the Finance Committee recommend that the Council adopt the attached resolution to amend Utilities Rate Schedules C-1 (Utility Service Calls), E-16 (Unmetered Electric Service) and W-2 (Water Service from Fire Hydrants), as attached. BACKGROUND Utilities Rate Schedules are updated as required based on rules and regulations governing the Utilities operations. Regularly, rate schedules are updated as part of the annual budget process to align utilities revenues with budgeted expenses. From time to time, rate schedules are also revised to add new provisions, delete outdated sections or schedules, or update language for clarity and/or to reflect current (and new) practices and procedures. The last revision to Utilities Rate Schedules E-16 and W-2 was implemented on July 1, 2008, as part of the Fiscal Year (FY) 2009 Budget Adoption (CMR: 269:08). The last revision to Utilities Rate Schedule C-1 was effective July 1, 2005, (CMR: 207:05). DISCUSSION Utilities Rate Schedule C-1: Utility Service Calls This rate schedule identifies customer fees for service calls and other Utilities -related service work for all Utilities services, including Water, Gas, Electric, Fiber and Wastewater Collection. This rate schedule also identifies hourly labor rates used by utilities to provide estimates to customers for services requested. This schedule is updated periodically to either reflect changes in available services, or incorporate updated Utilities operating costs, which are then used to bill the customer requesting the service. Service call charges have been adjusted to reflect the actual cost of providing the services. Currently, the charges are nominal and do not cover the cost to perform the services; and staff is recommending an increase to full cost recovery. For example, the current change for restoring service following turn-off for non-payment is $24 during normal working hours. However, this CMR: 205:09 Page 1 of 3 service requires two hours of labor which would cost $218 at the proposed labor rate of $109 per hour. The proposed changes eliminate the "Field Collection of Payment" service by removing the handling of customer cash payments from field staff and requiring the customer to pay -by -phone or in person. The "Customer Charges" have also been updated to reflect straight time and overtime labor rates, afterhours or weekend travel expense, and the time required to perform each service. Hourly labor rates have also been updated to reflect increases in labor expenses. As C-1 rates are used for service requests by customers, and proposed revisions are designed to recover costs. The net revenue impact of the proposed changes depends on the number and type of service calls, and is estimated at approximately $25,000 per year. Utilities Rate Schedule E-16: Unmetered Electric Service This rate schedule currently lists the existing customers and monthly charges per site for unmetered services such as automated irrigation systems, cable TV power supply, etc. It is proposed to be revised to indicate the applicable conditions and procedures used in establishing unmetered electric charges, rather than listing existing customers and applicable charges per customer. To recover the administrative costs involved in maintaining and billing unmetered accounts, a minimum monthly charge component has been explicitly identified in the rate schedule. The E-16 rate schedule also specifies the applicable Electric Rate Schedule that will be used in the calculation of the energy related charges for unmetered electric services. The individual unmetered customers currently listed have been deleted from the rate schedule and the new billing rate for such customers will be computed based on the proposed "Net Monthly Bill". The impact to an existing customer's bill will be an increase of 10% due to the change to Utilities Rate Schedule E-2, which is used in the calculation of energy charges, and an increase of 5% due to the change to Utilities Rate Schedule C-1, which is used in the calculation of miscellaneous labor costs. The changes in Utilities Rate Schedule E-2 have already been reviewed and unanimously recommended for approval by Finance Committee (CMR: 185:09) on March 31, 2009. The structural changes to the E-16 have been designed so that updated charges should result in no increase in existing charges to the customers other than the proposed rate increases due to changes in C-1 and E-2. The combined revenue increase due to the proposed changes is estimated to be approximately $10,345 per year. Utilities Rate Schedule W-2: Water Service from Fire Hydrants This rate schedule has been updated to reflect the five percent overall water rate increase recommended by the Finance Committee on March 31, 2009, for other water rate schedules. The annual water use under this rate schedule is estimated to be 6,261 hundred cubic feet (CCF), and therefore this change represents an estimated revenue increase of $1,470 for FY 2010. COMMISSION REVIEW AND RECOMMENDATIONS On April 1, 2009, the UAC voted unanimously (5-0), to recommend that the City Council amend Utilities Rate Schedules C-1 (Utility Service Calls), E-16 (Unmetered Electric Service) and W-2 (Water Service from Fire Hydrants), as attached. The notes from the UAC meeting are provided as Attachment E. RESOURCE IMPACT Approval of changes to Utilities Rate Schedules E-16 and W-2 will result in an increase in revenues of approximately $11,815 for FY 2010. The revenue increase due to the proposed CMR: 205:09 Page 2 of 3 changes to Utilities Rate Schedule C-1 depends upon the number and type of service calls and is estimated at approximately $25,000 per year. POLICY IMPLICATIONS This recommendation does not represent a change to current City policies. ENVIRONMENTAL REVIEW The City is raising rates for utility service calls to reflect the cost to provide these services. The City is changing the mechanism for rates for unmetered electric service so that rates depend on the estimated electrical energy usage, the applicable electric rate for similar services and on labor rates. The City is raising water rates predominantly for funding requirements due to capital projects planned to maintain service within existing facilities and increased Debt Service payments expected as a result of $35 million bond issuance associated with the Emergency Water Supply and Storage Project. The City also requires increased funding for water supply purchasing costs due to planned San Francisco Public Utilities Commission's infrastructure upgrade costs. An increase in these rates to meet operating expenses and financial reserve needs is not subject to the California Environmental Quality Act (CEQA), pursuant to California Public Resources Code Section 21080(b)(8) and Title 14 of the California Code of Regulations Section 15273(a)(1) and (3). ATTACHMENTS A. Resolution B. Utilities Rate Schedule C-1: Utility Service Calls C. Utilities Rate Schedule E-16: Unmetered Electric Service D. Utilities Rate Schedule W-2: Water Service from Fire Hydrants E. Excerpted draft notes from the April 1, 2009 UAC meeting PREPARED BY: DEPARTMENT APPROVAL: CITY MANAGER APPROVAL: IPEK CONNOLLY Utilities, Sr. Resource la ner JANE O. RATCHYE Utilities Assistant Director, Resource Management VALE R> O. FG Director of Utilities JAM KEENE City anager r I C� CMR: 205:09 Page 3 of 3 ATTACHMENT A NOT YET APPROVED Resolution No. Resolution of the Council of the City of Palo Alto Amending Utility Rate Schedules C-1, E-16, W-2 of the City of Palo Alto Utilities Rates and Charges. The Council of the City of Palo Alto does hereby RESOLVE as follows: SECTION 1. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule C-1 (Utility Service Calls) is hereby amended to read in accordance with sheets C-1-1 attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective on July 1st, 2009. SECTION 2. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule E-16 (Unmetered Electric Service) is hereby amended to read in accordance with sheets E-16-1, E-16-2 and E-16-3, attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective on July 1st, 2009. SECTION 3. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule W-2 (Water Service from Fire Hydrants) is hereby amended to read in accordance with sheets W-2-1 attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective on July 1st, 2009. SECTION 4. The Council finds that the revenue derived from the authorized adoption enumerated herein shall be used only for the purposes set forth in Article VII, Section 2, of the Charter of the City of Palo Alto. 1/ // /1 /1 // 1/ 1/ 1 090408 syn 6050725 NOT YET APPROVED SECTION 5. The Council finds that the adoption of this resolution is not subject to the California Environmental Quality Act (CEQA), pursuant to California Public Resources Code Sec. 21080(b)(8) and Title 14 of the California Code of Regulations Sec 15273(a)(1) and (3). INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: APPROVED: City Clerk Mayor APPROVED AS TO FORM: Deputy City Attorney City Manager Director of Administrative Services Director of Utilities 090408 syn 6050725 2 ATTACHMENT B UTILITY SERVICE CALLS UTILITY RA'I'L SCHEDULE C-1 A. SERVICE CALLS AND OTHER SERVICE WORK: Charges During Charges After Business Hours Business Hours Meter Set Restoration for service at meter following turn-off for non-payment Restoration of service at power pole following turn-off for non-payment Exchange meter for accuracy test (Rule 15) Field Collection of Payment Labor Rates Per Hour Per Person: Services provided during normal working hours No Charge $ 88.00294.00 $21.00 218.00 $ 17.00294.00 $100.00218.00 $200-00294.00 $2x.000-300.00 Service not Available $21.00 $17.00 $-1-04109.00 Services provided on overtime basis where the overtime is scheduled at the City's convenience. $122128.00 Services provided on overtime basis where the overtime is scheduled at the customer's convenience. $440147.00 B. RETURNED CHECK FEES: See City of Palo Alto Municipal Fee Schedule C. SPECIAL PROVISION: 1. Charges made under this schedule may be added to the regular monthly utilities bill of the person receiving the service and payment thereof will be subject to the Utilities Rules and Regulations regarding discontinuance of service for nonpayment. 2. Charge for meter exchange will be refunded if meter is found to be more than two percent (2%) over -registering. [End] CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1 20052009 Sheet No.C-1-1 Supersedes Sheet No. C-1-1 dated 79-13-20054 CITY OF PALO ALTO UTILITIES ATTACHMENT C UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 A. APPLICABILITY: This rate schedule is applicable under the regular terms and conditions of the City of Palo Alto Utilities Department to Customers who contract with the City forapplies to unmetered electric service for billboards, unmetered telephone services, telephone booths, railroad signals, cathodic protection units, traffic cameras, WiFi equipment, community antenna systems, cable TV power supplies, and automatic irrigation systems and also applies to other miscellaneous Electric Utility fees to various public agencies and private entities. B. TERRITORY: Within the incorporated limits of the City of Palo Alto and land owned or leased by the City. C. NET MONTHLY BILL: 1. Customer Charge $9.00 per month 2. Energy Charge (for all kWh supplied) using Electric Rate Schedule E2 plus all applicable riders 3. Minimum Charge Minimum monthly charge will be the Customer Charge. D. DETERMINATION OF ENERGY REQUIREMENTS: a. Initial Inventory Customer shall enter into a contract for service under this Schedule and provide a written inventory of all equipment at each of service requested. including the type and nameplate rating for each piece of equipment. The billing energy for each point of service will be determined by the Utilities Electric Engineering Division estimation of the kWh usage based on the type, rating and quantity of the equipment provided by the Customer. Monthly bill will be based on the following calculations: 1. Total Wattage. 2. Total Wattage times estimated annual operating hours as set in the contract equals CITY OF PALO ALTO UTILITIES Issued by the City Council Elh\ Effective 7-01-2009 Sheet No. E-16-1 Supersedes Sheet No. E-16-1 dated 7-01-2008 CITY OF PALO ALTO UTILITIES UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 annual watt hours. 3. Annual watt hours divided by 1000 hours equals annual kilowatt hours (kWh) 4. Annual kWh divided by twelve (12) months equal monthly kWh. 5. Monthly kWh times current rate per kWh = monthly bill for each unmetered service location or equipment. b. Updating Inventory Customer will update its inventory by informing the Utilities Electric Engineering Division in writing of changes in type, rating and/or quantity of equipment as such changes occur, and billings will be adjusted accordingly. Upon Utilities Electric Engineering Division request, but no later than the one year anniversary of the date on which Customer first takes service, Customer shall provide an updated inventory of all equipment at each point of service. c. Test Metering The Utilities Electric Engineering Division may, at its discretion, test meter the load at various types and ratings of the Customer's equipment to the extent necessary to verify the estimated kWh usage used for billing purpose and, where dictated by such test metering, Utilities Electric Engineering Division will make prospective adjustments in estimated usage for subsequent billing purposes; however, Utilities shall be under no obligation to test meter - the load of Customer's equipment. Utilities' decision not to test meter the load of Customer's equipment shall not release Customer from the obligation to provide to Utilities Electric Engineering Division, and to update, annually as provided in section b, an accurate inventory of the types, rating and quantities of equipment upon which billing is based. d. Inspection The Utilities Electric Engineering Division shall endeavor to inspect the equipment at each point of service annually as close to the anniversary date of the contract as is practical, and make prospective adjustments in billing as indicated by such inspections; however, Utilities shall be under no obligation to conduct such inspections for the purpose of determining accuracy of billing or otherwise. Utilities decisions not to conduct such inspections shall not release Customer from the obligation to provide to Utilities Electric Engineering Division, and to update, an accurate inventory of the types, rating and quantities of equipment upon which billing is based. CITY OF PALO ALTO UTILITIES Issued by the City Council 1WV Effective 7-01-2009 Sheet No. E-16-1 Supersedes Sheet No.E-16-1 dated 7-01-2008 CITY OF PALO ALTO UTILITIES UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 e. Billing for Service As the service described in this schedule is unmetered, Customer agrees to pay amounts billed in accordance with the current inventory, regardless of whether any of the installations of the Customer's equipment were electrically operable during the period in question and regardless of the cause of such equipment failure to operate. €E. MISCELLANEOUS RATES: Service Description Customer 4-. Automatic Irrigation Systems: State of Hwy 101 & Embarcadero, California, Sand Hill Road Public Works 2 Highway Lighting & Sign State of Illumination California (A) Highway Lighting Electrolier (20,000 L) Electrolier ('1000 L) & (7000 L) (B) Sign Lighting Sign (1,910 W) Signs (1,572 W) Signs (786 W) 3. Page Mill Expressway and Santa Clara El Camino Park & Ride Lot County Lighting and Signal /I. Automatic sprinklers at Oregon Public Works & Page Mill Expressway Rate * $7.38 ea @ 25.70 ea @ 12.93 ea @ 85.80 ea • 70.51 ea • 35.26 ea 80.26 39.13 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-01-2009 Sheet No. E-16-1 Supersedes Sheet No. E-16-1 dated 7-01-2008 CITY OF PALO ALTO UTILITIES UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 Service Description Customer Rate * S1. Traffic Signal maintenance and energy costs (A) Controller $548.78 ea $1.85 6.12 ea (C) 12" & PVH Lamp(LED) (D) Pedestrian Head(LED) (E) Vehicle, System and Bike Sensor Loop 6. Electric Service for Cathodic Protection Station 7. Cable TV Power Supply/Service 82. Permit Fee for Electric Conduit Usage (A) Exclusive use (B) Non -Exclusive use PG&E Comcast Permittee Permittee 93. Processing Fee for Electric Conduit Usage Permittee 4-04. Permit Fee for Utility Pole Attachments (A) (B) (C) (D) 1 ft. of usable space 2 ft. of usable space 3 ft. of usable space 4 ft. of usable space 445. Processing Fee for Utility Pole Attachments 12. Utilities Broadband Local Area Network (A) Bandwidth Assignment (B) Carrier Usage 13. Power supply to Permittee City Departments City Departments $522.26 (B) 8" Lamp (LED) $2.168.21 ea $5.58 1099ea $43.2221.97 ea 11.95 19.92 1.4044A/ft/yr 0.70A 5/ft/yr Actual Cost $24.4118.08/pole/yr $26.8619.98/pole/yr $29.3221.87/pole/yr $31.7723.77/pole/yr $5447789/pole 210.80/MHZ 52.70/carrier CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1-2009 Sheet No. E-16-4 Supersedes Sheet No.E-16-2 dated 7-01-2008 CITY OF PALO ALTO UTILITIES UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 Groundwater Treatment Service 130.32 Rates are monthly unless otherwise indicated. CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1-2009 Sheet No. E-16-5 Supersedes Sheet No. E-16-2 dated 7-01-2008 CITY OF PALO ALTO UTILITIES UNMETERED ELECTRIC SERVICE UTILITY RATE SCHEDULE E-16 D. SPECIAL PROVISIONS: In the event a customer requests an electric service which the Utility determines will be an unmetered 6ervice, or miscellaneous fee, the Utility will charge an interim rate reflecting the Utility's estimated costs associated with the specific service. The Utility may charge an existing rate contained on this Rate Schedule for an identical or similar type service, or prepare a new rate. This interim rate will serve as the effective rate for billing purposes until the service type is added to Rate Schedule E 16. {End] CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-01-2009 Sheet No. E-16-3 Supersedes Sheet No. E-16-3 dated 7-01-2008 CITY OF PALO ALTO UTILITIES ATTACHMENT D WATER SERVICE FROM FIRE HYDRANTS UTILITY RATE SCHEDULE W-2 A. APPLICABILITY: This schedule applies to all water taken from fire hydrants for construction, maintenance, and other uses in conformance with provisions of a Hydrant Meter Permit. B. TERRITORY: This schedule applies everywhere the City of Palo Alto provides water services. C. RATES: 1. Monthly Customer Charge. METER SIZE 5/8 inch 50.00 3 inch 125.00 2. Commodity Rate: (per hundred cubic feet) $4.9946 D. SPECIAL NOTES: 1. Monthly charges shall include the applicable monthly customer charge in addition to usage billed at the commodity rate. 2. Any applicant using a hydrant without obtaining a Hydrant Meter Permit or any permittee using a hydrant without a Hydrant Meter Permit shall pay a fee of $50.00 for each day of such use in addition to all other costs and fees provided in this schedule. A hydrant permit may be denied or revoked for failure to pay such fee. 3. A meter deposit of $750.00 may be charged any applicant for a Hydrant Meter Permit as a prerequisite to the issuance of a permit and meter(s). A charge of $50.00 per day will be added for delinquent return of hydrant meters. A fee will be charged for any meter returned with missing or damaged parts. 4. Any person or company using a fire hydrant as described in D.2 above or who draws water from a hydrant without a meter installed and properly recording usage shall, in addition to all other applicable charges be subject to criminal prosecution pursuant to the Palo Alto Municipal Code. {End} CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 117-1 200S2009 Supersedes Sheet No W-2-1 dated -711-1-20082009 S ATTACHMENT E EXCERPTS from Draft Minutes of UAC Meeting of April 1, 2009 ITEM 4: ACTION ITEM: Recommendation on Changes to Utilities Rate Schedules C-1, E-16 and W-2 Senior Resource Planner Ipek Connolly was available to ask questions on the staff report. Commissioner Waldfogel noted an error on the draft rate schedule E-16 section D.a.3. Director Fong thanked him for pointing it out and noted that it will be corrected. Commissioner Keller asked if there were any way to soften the blow for the large increase in the cost to turn power back on after turnoff for nonpayment. Fong noted that the rates reflect costs Keller asked that Utilities consider communicating this cost to customers in advance of a shut-off. ACTION: Commissioner Rosenbaum moved the staff recommendation. The motion was seconded by Commissioner Waldfogel. The motion carried unanimously.