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HomeMy WebLinkAbout1998-06-29 City Council (8)TO: City of Palo Alto City Manager’s Report HONORABLE CITY COUNCIL 7 FROM: DATE: CITY MANAGER JUNE 29, 1998 DEPARTMENT: UTILITIES CMR: 284:98 SUBJECT:RESOLUTION EXTENDING PERIOD FOR UTILITIES P~S~TE RELIEF TO FLOOD DAMAGED RESIDENCES AND BUSINESSES ON AN EXCEPTION BASIS RECOMMENDATION Staff recommends that City Council adopt the attached resolution to extend the period staff is authorized to issue Utility bill credits on an exception basis to qualifying residents and businesses who increased their water, gas, and!or electric consumption to mitigate property damage and losses caused by the winter floods. BACKGROUND As a result of the February 3, 1998 flooding in Palo Alto, some residents and businesses have have found it necessary to use unusually high amounts of water, gas, and/or electricity to clean up and dry out their homes or businesses. To help alleviate the financial impact of these unusually high utility bills, the City. Council approved a rate relief program on March 16, 1998 that provided bill credits to qualifying residents and businesses applicable to the February and March billing cycles (CMR: 155:98). Approximately $30,000 in water, gas, and electric rate relief has been provided to date. However, since March 1998, some customers have continued to experience high utility bills to dry out their homes. In order to provide financial assistance to such customers beyond the currently authorized February and March billing cycles, staff recommends extending the reimbursement period on an exception basis through the August 1998 utility billing cycle. DISCUSSION Most residential customers who experienced flood damage have apparently completed cleaning and drying out their homes. However, it has come to staff’s attention that some residents have found it necessary to continue using high amounts of utilities beyond CMR:284:98 Page 1 of 3 March 1998 to clean up and dry out their homes. Some residents have floors that retained moisture through May~ Others did no~ return to their homes to begin the clean up process until weeks or months after the February flood because they lacked fimds to repair the damage or cannot fred a contractor to do the work. Others have yet to return to repair their homes. In recognition of the fact that some residents have been delayed, either intentionally or unintentionally, in cleaning and drying out the moisture within the walls and floors of their homes, staff believes it is appropriate to extend the reimbursement window to qualifying customers. If Council approves this extension, staff will notify residents and businesses how they may apply for consideration of a bill credit applicable for the period April 1998 to August 1998. This extension would allow customers to qualify for bill credits retroactively to cover the utility billing cycles of April thru August. The bill adjustment will be limited to the utility charges related to the increase in above average consumption of water, gas, and electricity occasioned by cleaning up and drying out a residence due to the February flood. For example, a customer who paid a high water, gas, and electric bill of $225, but under normal circumstances would have paid about $125, would qualify for a credit of $100. In this example, the total credit would be $105 since there would be a credit of $5 in Utilities Users Tax. Staff will apply similar procedures used for the February and March reimbursement period to determine qualifications. Any requests for flood related rate relief not explicitly covered by the above criteria will be reviewed on a case by case basis by the Assistant City Manager or her designee. RESOURCE IMPACT It is difficult to estimate how many residents or businesses would qualify or choose to request a bill adjustment. Based on the $30,000 expended for February and March, additional credits for the period April through August may total an additional $20,000. To the extent a source of funding is necessary to replace the reduction in sales revenue, the Water, Gas, and Electric Funds Rate Stabilization Reserves exist for such contingencies and can accommodate this shortfall. POLICY IMPLICATIONS The proposed resolution extends an existing policy to reimburse utility customers who have used more water, gas, and/or electricity to clean up flood damaged residences and businesses. ENVIRONMENTAL REVII~W Approval of a modification to Utility Rule and Regulation Number 2 does not constitute a CMR:284:98 Page 2 of 3 project under the California Environmental Quality Act. Therefore, an environmental assessment is not required. ATTACHMENT Resolution Prepared by: Randy Baldschun, Assistant Director of Utilities, Administrative Services DEPARTMENT HEAD REVIEW: CITY MANAGER APPROVAL: HARRISON Assistant City Manager CMR:284:98 Page 3 of 3 RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING RESOLUTION NUMBER 7748 RELATING TO THE TEMPORARY SUSPENSION OF THECOLLECTION OF CERTAIN UTILITY CHARGES AS A RESULT OF FLOOD-RELATED DAMAGE AND LOSSES AND APPROVAL OF A REVISION TO UTILITIES RULE AND REGULATION NUMBER 2 PERTAINING ,TO POLICY BILLING ADJUSTMENTS WHEREAS, on March 16, 1998, the City Council adopted Resolution Number 7748, (a) suspending the collection of water, gas and electric service charges authorized pursuant to Section 12.20.010 of the Palo Alto Municipal Code, when that portion of those service charges for which such charges would be payable are in excess of those charges normally consumed by Palo Alto utility customers, and (b) approving a modification to Utilities Rule and Regulation number 2, which permits billing adjustments to be made for increases in the consumption of water, gas and electric service resulting from reasonable efforts to mitigate or remedy the property damage and losses caused by an event of force majeure; and WHEREAS, Palo Alto utility customers have requested that the City extend billing adjustments in connection with water, gas and electric utility service charges incurred in connection with ongoing efforts to mitigate the effects of the flooding of San Francisquito Creek; NOW, THEREFORE, the Council of the City of Palo Alto does hereby RESOLVE as follows: SECTIQN i. Section 3 of Resolution Number 7748 is hereby amended in its entirety to read as follows: ~~. The suspension of the collection of water, gas and electric service charges for consumption in excess of a utility customer’s normal usage shall be effective for the billing cycles during the months of February, 1998, through August, 1998, inclusive." ~. Except as provided herein, the provisions of Resolution Number 7748 which are not modified herein shall remain in full force and effect. 980623 syn 0071471 SECTION 3. The Council hereby finds that the action taken hereunder does not constitute a project for purposes of the California Environmental Quality Act, and, therefore, no environmental assessment is required. INTRODUCED AND PASSED: AYES: NOES: ABSENT ABSTENTIONS: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Senior Asst. City Attorney Mayor City Manager Director of Utilities Director of Administrative Administrative Services 980623 syn 0071471