Jan 04, 2024 Utilities Commission

FOR, 'CAUSE YOU HEAR A LOT ABOUT SCAMS WHERE PEOPLE COME TO THE DOOR AND THEY SAY THEY'RE FROM THE UTILITIES AND PEOPLE DON'T KNOW, UH, ARE THEY REALLY FROM THE UTILITIES? SO, UH, DIANA'S WORKING WITH HER GROUP, UM, CUSTOMER SERVICE ON THE GAS AND WATER SIDE WITH THE UTILITY CALL CENTER TO REALLY TIGHTEN THAT UP SO THAT IF A CUSTOMER, UM, A RESIDENT, UH, HAS SOMEONE COME TO THE DOOR, THEY'LL, THEY'LL BE TOLD WHAT TO LOOK FOR.

[ANNOUNCEMENTS]

ANNOUNCEMENT.

VERY, IT WAS ON SALE.

SAY THANK YOU SO MUCH.

I'D LIKE TO SAY WHAT GLORIA USED TO ALWAYS, UH, SAY.

SO I'LL COPY WHAT GLORIA, UH, SAID.

WE THANK YOU FOR ALL THE HARD WORK THAT YOU PUT IN, UH, FOR 23, AND WE'RE LOOKING FORWARD TO, UM, UM, BEING, I MEAN, CONTINUING THE GOOD WORK THAT YOU DID IN 23.

UM, AND 20, UH, 24.

NEXT IS, UM, CHRIS GARNER.

UH, THANK YOU DIRECT.

SO YOU'LL NOTICE IT'S JUST LIKE CHURCH.

EVERYBODY SITS IN THE BACK AND NO ONE SITS IN THE FRONT PEWS.

UM, SO SOME GOOD NEWS.

UM, WE'RE GONNA BE ISSUING A, A PRESS RELEASE THIS MORNING.

UM, IF YOU REMEMBER LAST JANUARY WHEN WE HAD THE GAS CRISIS AND THE PRICING, AND PEOPLE EXPERIENCED GAS BILLS, 2, 3, 400, SOME AS HIGH AS 800 $900,000.

UM, THE COST OF GAS WHERE WE GO OUT AND BUY IT IN THE OPEN MARKET UNDER THESE NEW CONTRACTS, UM, THE COST OF GAS FOR THE JANUARY OF 24 IS GOING TO BE 80% LESS THAN IT WAS IN JANUARY 23.

AND SO THE IMPACT OF THAT ON THE AVERAGE RESIDENTIAL GAS BILL, WE EXPECT THE AVERAGE RESIDENTIAL GAS BILL TO BE 64% LOWER THAN IT WAS LAST JANUARY.

UM, AFTER BEING THE LOWEST PRICED, UH, GAS UTILITY IN CALIFORNIA FOR THE PAST FOUR MONTHS.

UM, FOR JANUARY, WE'LL BE THE SECOND LOWEST.

WE'RE SLIGHTLY BEHIND SOCAL GAS, SO WE'RE SECOND LOWEST IN THE STATE.

NOT THE LOWEST, BUT WE'RE STILL FAR OUTPACING.

THE OTHER GAS UTILITIES, WERE 35% LOWER THAN PG E UP NORTH, 27% LOWER THAN SOUTHWEST GAS, 23% LOWER THAN THAN SAN DIEGO GAS ELECTRIC AND 90% LOWER THAN THE OTHER MUNICIPAL GAS UTILITY UP IN PALO ALTO.

SO I WANNA THANK, UH, TONY FOSTER, UH, DENNIS BURKE AND HEATHER HAMILTON FURTHER THEIR WORK UNDER DIANA TANG'S LEADERSHIP.

UH, THEY'VE DONE A GREAT JOB IN GETTING US BACK ON TRACK WHERE WE WERE WHEN WE STARTED LAST JANUARY.

SO THAT'S THE GOOD NEWS.

THE, THE, UH, UM, SOME TROUBLING NEWS IS, AS WE'VE SHARED WITH THE BOARD BEFORE, BECAUSE OF THE CYBERSECURITY ATTACK THAT, UH, OCCURRED WITH THE CITY, WE TOOK THE BILLING SYSTEM OFFLINE AS A, UH, JUST OUT OF ABUNDANCE OF CAUTION AND MADE SURE THAT THE SYSTEM WAS OPERATING.

SO IT WAS OFFLINE FOR ABOUT TWO WEEKS.

BECAUSE OF THAT, WE HAD ABOUT A THIRD OF OUR GAS BILLS WENT OUT ON TIME.

UTILITY BILLS WENT OUT ON TIME.

UM, ANOTHER THIRD, MAYBE 2, 3, 4 DAYS LATE, UH, WHICH WASN'T, UH, TROUBLING.

BUT THEN WE HAD AN, UH, ABOUT ANOTHER THIRD THAT, UM, WE DID NOT BILL IN THE MONTH OF NOVEMBER.

AND SO THEY GOT A DOUBLE BILL.

UM, AND SO YOU'RE SEEING A LOT OF PEOPLE, UM, IN CERTAIN PARTS OF THE CITY WHERE JUST BECAUSE WHERE THEIR BILLING CYCLE LANDS, UM, ARE RECEIVING, UH, INSTEAD OF A 30 DAY BILL, IT'LL BE A 60 DAY BILL.

AND SO IF THEY DON'T REALIZE THAT, THEY OPEN IT UP AND SAY, OH MY GOD, THIS IS JUST LIKE LAST JANUARY.

OUR BILL HAS DOUBLED.

AND SO THERE'S BEEN SOME ON SOCIAL MEDIA, BUT THE GOOD NEWS IS, UM, FOR EVERYONE THAT SAYS, OH, MY BILL DOUBLED, THERE'S SOMEONE ELSE SAYING, WELL, THAT'S BECAUSE OF THE CYBERSECURITY ATTACK.

THEY'RE AWARE OF WHAT HAPPENED.

LOOK AT YOUR BILL.

IT'S, IT'S DOUBLE THE DAYS.

AND SO, UM, WE'RE WORKING WITH THE CALL CENTER TO MAKE SURE THAT IF A CUSTOMER CALLS IN, THERE'S NO, NO ONE'S GETTING THEIR SERVICES TERMINATED.

NO ONE IS RECEIVING A LATE FEE.

UM, WE'RE WORKING WITH ANY CUSTOMER IF THERE'S A FINANCIAL IMPACT THAT THEY NEED TO, UH, BE ACCOMMODATED FOR.

WE'RE WORKING WITH THE CUSTOMER.

SO THERE, THERE SHOULD NOT BE ANY ISSUE WITH THAT.

AND IT'S A ONE TIME DOUBLE BILLING.

WE'LL BE BACK ON TRACK, UH, WITH THE NEXT MONTH'S BILLING.

UM, SOMETHING ELSE THAT HAPPENED IS, UM, WE'RE LOOKING AT REVAMPING AND TIGHTENING UP OUR, UH, CUSTOMER NOTIFICATIONS

[00:05:01]

UH, OBVIOUSLY THE, THE ID, THE TRUCK, THE UNIFORM, AND THEN THEY HAVE, HAVE A PHONE NUMBER TO CALL IN TO VERIFY, BECAUSE EVEN WITH TRUCK ID, I MEAN, IT'S CONCEIVABLE THAT YOU COULD STILL HAVE SOMEONE SCAMMING YOU.

SO WE'LL HAVE A PHONE NUMBER WHERE PEOPLE CAN CALL IN AND VERIFY THAT YES, THAT PERSON AT THE DOOR IS SOMEONE, UH, FROM THE UTILITY.

AND THEN LASTLY, UH, YOU SURE HAVE ALL RECEIVED A INVITATION TO THE CITY'S, UH, STATE OF THE CITY EVENT, UH, JANUARY 9TH.

UM, UM, IF YOU HAVEN'T, LET ME KNOW AND WE'LL MAKE SURE THAT, UH, YOU GET NOTIFIED OF THAT.

UM, WE'LL BE ASKED TO BE A, A SPONSOR OF THAT EVENT AGAIN.

UM, I, I BELIEVE IT'S AT THE SAME LEVEL AS WE DID LAST YEAR, WHICH WAS ACTUALLY A LITTLE LESS THAN WHAT THEY HAD ASKED FOR.

SO, UM, I, I DON'T, I DON'T THINK THERE SHOULD BE ANY PROBLEM WITH THAT.

HOPEFULLY SAME LEVEL AS LAST YEAR.

AND THAT'S IT.

[1. 23-51635 Recommendation to approve December 21, 2023 Board meeting minutes. Suggested Action: Approve recommendation. ]

MOTION TO APPROVE.

UM, SECOND AND A SECOND.

A MOTION APPROVAL BY SECOND BY MS. ALL FAVOR? AYE.

AYE.

ADOPT SPECIFICATION AND AUTHORIZE THE GENERAL MANAGER TO SIGN A CONSTRUCTION CONTRACT WITH FELLOW LYNCH QUALITY WELLS.

THE HEARING? NONE THE MOTION CARRIES.

UM, ITEM NUMBER TWO,

[2. 23-51636 Approve recommendation to adopt Specifications WD-21-22 for the Rehabilitation of Wells Commission 14 and Citizens 10 Project (EO-3553) and authorize the General Manager to sign a construction contract with L.O. Lynch Quality Wells & Pumps, Inc., in an amount of $4,320,360. Suggested Action: Approve recommendation. ]

AND, AND, UM, DAN? YEAH, DANA, MUSLIM.

GOOD MORNING COMMISSIONERS.

UH, SO ITEM NUMBER TWO IS TO THE REHABILITATION OF WELLS COMMISSION 14 AND CITIZENS 10 PROJECT.

EXCUSE ME.

YES, I'M OLD.

JUST A LITTLE BIT LOUDER.

UH, FOR THE FINAL EQUIPPING PHASE.

REHABILITATION OF WELLS COMMISSION 14 AND CITIZENS 10 PROJECT FOR SOME BACKGROUND ON COMMISSION 14.

IT'S LOCATED ON THE SOUTH SIDE OF HARTWELL PARK, EAST OF WOODRUFF AVENUE.

AS YOU CAN SEE ON THE MAP THERE, IT'S CLOSER TO THE INTERSECTION OF CARSON AND WOODRUFF.

THIS WELL WAS DRILLED IN 1980 AND SINCE THEN HAS SEEN A DECLINE IN PRODUCTION.

THE SECOND WELL OF THE PROJECT IS CITIZENS TENT.

IT'S LOCATED SOUTH OF THE AIRPORT ON AIRPORT LANE OFF OF SPRING AVENUE.

UH, THIS WELL WAS DRILLED BACK IN 1992 AND IS ALSO SEEN A DECLINE IN PRODUCTION AS WELL AS ISSUES WITH ITS MOTOR.

BUT BOTH OF THESE WELLS ARE LARGE PRODUCERS IN OUR SYSTEM.

UH, SO THE REHABILITATION ADDRESSES THE DECLINE IN PRODUCTION AND IN SPECIFIC CAPACITIES, AS WELL AS VARIOUS UPGRADES TO EQUIPMENT ON SITE TO MAKE THE WELLS MORE EFFICIENT.

UH, THIS WILL ALLOW FOR MORE FLEXIBILITY IN OUR WELL COLLECTION SYSTEM WITH THE ABILITY TO CYCLE AND REST WELLS AND LIMITING THE EFFECTS TO OUR OVERALL PRODUCTION.

AS PART OF THE PROJECT, THE WELLS ARE GONNA UNDERGO MECHANICAL AND CHEMICAL CLEANING OF THE SCREENS AND GRAVEL PACK, REPLACEMENT OF PIPING AND VALVES, UPGRADES, THE ELECTRICAL AND INSTRUMENTATION EQUIPMENT AT THE SITE.

THIS INCLUDES PUMPS, MOTORS, FLOW METERS, AND PRESSURE TRANSMITTERS, AND ALSO IMPROVEMENTS TO THE SITE SURROUNDING THE WELLS.

THE PICTURE ON THE LEFT HAND SIDE THAT YOU CAN SEE THERE IS A PASTURE REHAB FROM 2014, AND THAT'S AIRLIFTING OF CHEMICAL TREATMENT AT THE COMMISSION 17.

THAT'S ALSO AT HARTWELL PARK.

SO THIS PROJECT IS EXPECTED TO START IN MARCH AND END IN DECEMBER, 2025.

THAT DURATION IS QUITE LONG, SO HOPEFULLY THE CHART HERE WILL HELP CLEAR THINGS UP A LITTLE BIT.

UH, ONLY ONE WELL CAN BE TAKEN OFF AT A TIME.

SO WORK AT THE WELLS HAS TO START STAGGERED.

AS YOU CAN SEE FROM THE CHART OVER THERE, THE INITIAL REHABILITATION PHASE FOR THE TWO WELL SHOULD LAST AROUND FOUR MONTHS.

THAT'S FOLLOWED BY A VERY LONG PROCUREMENT PHASE FOR LONG LEAD TIME ITEMS SUCH AS THE PUMPS, THE PLCS, AND THE SWITCHBOARDS THAT WE NEED TO FOR THE PROJECT.

DURING THIS PROCUREMENT PHASE, BOTH WELLS ARE BROUGHT BACK ONLINE, ALLOWING PRODUCTION TO CONTINUE ONCE THE MATERIALS HAVE BEEN DELIVERED, THE CONTRACTOR MOBILIZES TO THE SITE,

[00:10:01]

THAT ALSO TYPICALLY TAKES AROUND FOUR MONTHS AFTER COMPLETION OF THE EQUIPPING PHASE, THE WELL IS PUT BACK INTO PRODUCTION.

SO PHASING LIKE THIS ENSURES THAT AT LEAST ONE WELL IS ON AT A TIME.

AND THIS LIMITS THE IMPACT TO OUR GROUNDWATER WELL SYSTEM.

ON SEPTEMBER 14 AND 21ST, 2023 STAFF PUBLISHED NOTICE INVITING BIDS FOR THE REHABILITATION OF WELLS COMMISSION 14 AND CITIZENS 10 ON NOVEMBER 2ND.

TWO BIDS WERE RECEIVED.

AFTER EVALUATING ALL BIDS RECEIVED, THE LOWEST RESPONSIVE BIDS SUBMITTED BY LO LYNCH IN AN AMOUNT OF $4,320,000 WAS FOUND TO BE IN CONFORMANCE WITH THE BID DOCUMENTS.

STAFF RECOMMENDS THE ADOPTION OF SPECIFICATIONS WD 2122 FOR THE REHABILITATION OF WILL'S COMMISSION 14 AND CITIZENS 10 PROJECT, AND AUTHORIZING THE GENERAL MANAGER TO SIGN A CONSTRUCTION CONTRACT WITH LO LYNCH QUALITY WELLS AND PUMPS IN AN AMOUNT OF $4,320,360.

THAT CONCLUDES MY PRESENTATION, SO I'LL BE HAPPY TO ANSWER ANY QUESTIONS.

ARE THERE ANY, ANY QUESTIONS? NO.

ANY, NO.

FIRST ANY PUBLIC COMMENTS? ANY COMMISSIONER'S COMMENTS? GLORIA? IT'S JUST A QUICK QUESTION.

YES.

I NOTICED THAT THE, THE CITIZENS 10 IS IN THE MORE OF A BUSINESS AREA.

THE OTHER ONE IS HARTWELL PARK AND IT'S BUTTS UP AGAINST PARK CREST.

, UM, RIGHT ACROSS THE STREET IS ALL THE RESIDENTIAL.

YES.

IT'S, AND IT'S QUITE A, A LONG TIME.

UM, HOW DO WE, HOW DO WE DEAL WITH THAT? SO DURING THE TWO PHASES WHERE WE ACTUALLY HAVE WORK, THAT'S THE REHABILITATION, THE EQUIPPING, WE ARE ACTUALLY GONNA HAVE SAND WALLS AROUND THE AREA.

YOU'RE GONNA, WHAT? WE'RE GONNA HAVE SAND WALLS AROUND THE AREA.

OH, PERFECT.

SO HOPEFULLY THAT'LL MITIGATE A LOT OF THE CONCERNS EITHER, EITHER WAY, WE'RE GONNA BE DOING A LOT OF NOTIFICATION BEFORE THE CONSTRUCTION, DURING THE CONSTRUCTION, AND WE DO SOUND MITIGATION AND, UH, READING OF THE DECIBELS AS WELL, SO, OKAY, GREAT.

OKAY, GOOD.

'CAUSE I DON'T, I DON'T REMEMBER IF THAT'S, I LIVE NEAR THE OTHER SIDE, BUT, UM, IF THAT'S NEAR THE PLAYGROUND, I DON'T RECALL.

UH, IT'S NEAR ONE OF THE BASEBALL FIELDS.

IT'S TO THE EAST OF THERE.

SO IT'S QUITE A TRAFFICKED AREA.

WE'RE GONNA HAVE A LOT OF SIGNS THERE, A LOT OF NOTIFICATION LIKE I MENTIONED.

AND ALONG THOSE LINES, UH, I, I THINK WE'VE LEARNED A LOT OF LESSONS WITH THE OTHER DRILLINGS THAT WE'VE DONE IN NORTH LONG BEACH OR IN OVER IN STEARNS PARK.

UH, 'CAUSE THOSE ARE RESIDENTIAL NEIGHBORHOODS.

AND SO WE'LL, UH, USE A LOT OF WHAT WE'VE LEARNED IN THOSE SITUATIONS WITH THIS.

WELL, OKAY.

ANY OTHER, UH, COMMENTS OR QUESTIONS? ONE, ONE FINAL BIT OF TRIVIA.

SO, UH, HARTWELL PARK IS NAMED AFTER, UH, UH, HARTWELL, WHO WAS THE FIRST COMMISSIONER OF LONG BEACH.

SO, WOW.

REALLY? THERE YOU GO.

QUESTION, IS THAT SOMETHING WE HAVE TO LOOK FORWARD TO? LIKE A, EACH OF US GET A, IN A HUNDRED YEARS, WE'RE GONNA NAME SOMETHING AFTER YOU TRUST ME, OR I THINK YOU DID GIVE ME A SEWER LINE FOR MY BIRTHDAY ONE , SO THAT WAS THAT SAFE.

MR. KEVIN SCOTT, UH, JUST A COUPLE QUESTIONS JUST SURE.

FOR MY CLARIFICATION.

SO, DECLINE IN PRODUCTION ON BOTH WELLS.

, WHAT PERCENTAGE WOULD YOU SAY? SO WE MEASURE THE DECLINE IN PRODUCTION MOSTLY BY THE SPECIFIC CAPACITY.

, THAT'S A MEASUREMENT OF HOW MUCH WE CAN DRAW FROM THE, WELL COMPARISON TO HOW MUCH THE WATER WELLS DROP.

SO I ACTUALLY DO HAVE THOSE FIGURES.

UM, IN COMMISSION 14 WE SAW 73% LOSS FROM THE ORIGINAL SPECIFIC CAPACITY.

AND CITIZENS 10 WAS AROUND A 64% LOSS.

AND THEN JUST FOR MY UNDERSTANDING, YOU SAID CYCLE AND REST THE WELL, MM-HMM.

SO WE'RE HOPING THAT TO HAVE BIGGER WELLS THAT PRODUCE MORE AMOUNTS OF WATER, WE CAN PUT OTHER WELLS OFFLINE, REST THEM FOR A BIT, THEN TURN THAT WELL BACK ON, TURN THE OTHER ONE BACK OFF.

AND THAT IT'S JUST LIKE, AND BY THAT, YEAH, SORRY.

I'M SORRY.

JUST BY RESTING THAT, THAT'S JUST RESTING THE EQUIPMENT OR RESTING, IT RESTS THE EQUIPMENT BECAUSE YOU'RE NOT PRODUCING AS MUCH.

SO YOU'RE NOT PUTTING YOUR GRAVEL PACK AND THE SCREENS, YOU'RE NOT, I GUESS, BIOFOULING THEM.

SO IT MEANS THAT YOU'RE PUTTING, IF THERE'S ANY CONTAMINANTS IN THE WATER, THEY GET STUCK TO THE SCREENS.

AND THEN SLOWLY, LITTLE BY LITTLE BY TIME IT STARTS GROWING AND IT STARTS CLOGGING YOUR SCREENS.

COMMISSIONER SCOTT.

SO IF YOU'RE SLURPING REALLY HARD ON A SLURPEE IN SUMMERTIME AND YOU SLURP TOO HARD, YOU DON'T GET ENOUGH OF THE MIX AND YOU'RE LEFT WITH JUST ICE.

RIGHT.

SO IF YOU REST, THEN THE LIQUID GETS BACK INTO THE NEAR OF THE STRAW.

AND YOU CAN SUCK YOUR SLURRY AGAIN.

THAT'S A GREAT COMPARISON.

ANTLE EXPLAINS A LOT OF THAT TO ME LIKE THAT OFF.

ARE YOU GOOD, CORDERO? YEAH.

JUST REAL QUICK.

I THINK WE'RE GONNA HAVE TO DO SOMETHING, ESPECIALLY 'CAUSE WE HAVE BUDGET COMING UP, UH, UH, NEXT COUPLE MONTHS, IS TO REALLY, UH, EMPHASIZE THAT TO OUR CUSTOMERS.

UM, CHRIS IS, THIS IS A REAL TEACHABLE MOMENT I THINK, FOR PEOPLE TO REALLY UNDERSTAND WHY WE'RE DOING THIS OR DO WE HAVE ANY PLANS FOR A PRESS RELEASE RELEASE? YOU KNOW, I, I WAS JUST THINKING THAT WHEN, WHEN I WAS LOOKING AT THIS IS, HERE'S ANOTHER GOOD EXAMPLE OF WHAT WE'RE DOING WITH, WHEN YOU PAY YOUR BILL, WE TAKE YOUR MONEY AND WE REINVEST IN THE SYSTEM FOR LONG-TERM BENEFIT.

SO I, I,

[00:15:01]

AND REALLY, DO I JUST SAY DOG AND PONY SHOW? DIANE TANG IS RAISING HER HAND, UH, HOPEFULLY SHE'S AGREEING 100% AGREE WITH YOU.

AND ON, ON THIS PROJECT.

AND FOR A PROJECT THAT, UH, I BELIEVE WENDY IS WORKING ON ACTUALLY WITH CAROLINA ON A, ON A DIFFERENT WALL PROJECT, SIMILAR, THE CITY AND THE STATE REQUIRES A CERTAIN, UM, NOTIFICATION RADIUS.

WHENEVER WE'RE DOING A LARGE CONSTRUCTION PROJECT, WE'RE ACTUALLY GOING BEYOND THAT RADIUS, UM, NOT JUST FOR NOTIFICATION PURPOSES OF PROJECT, BUT TO INFORM THE COMMUNITY AND THE NEIGHBORHOOD THAT THIS WELL IS COMING NEAR YOU.

UM, YES, THERE'LL BE CONSTRUCTION, BUT ALSO THIS IS WHAT WE'RE DOING WITH YOUR, UH, RATE PAYER DOLLARS TO INCREASE DROUGHT RESILIENCY AND, UM, GROUNDWATER PRODUCTION HERE IN THE CITY.

SO WE WOULD DO THE SAME FOR THIS PROJECT OR BOTH OF THESE WALLS ALSO.

SO, SO THERE'S TWO AUDIENCES.

ONE IS THE ONES THAT ARE IMPACTED WITH THE NEARBY CONSTRUCTION.

THE OTHER IS JUST OUR GENERAL, GENERAL, UH, CUSTOMERS.

I THINK IT'S SO IMPORTANT FOR THEM TO UNDERSTAND WHERE THAT MONEY GOES AND WHAT WE SPEND IT ON.

BECAUSE REAL REALISTICALLY, IF I MAY REALISTICALLY, UM, I MEAN, BEFORE I WAS A COMMISSIONER, IF I LIVED IN THAT AREA, IF I HAD SEEN THAT, I WOULD'VE SAID, OH, IT'S A NUISANCE.

YOU'RE WALKING THROUGH THE PARK, THERE'S NOISE, WHATEVER.

AND, BUT IF YOU KNOW THE BACKSTORY ON IT, IT, IT REALLY DOES, UM, SEND A MESSAGE OF AS TO WHAT THIS DEPARTMENT IS DOING.

UM, SO I, I, I REALLY HOPE WE CAN, CAN PURSUE THAT.

UM, GREAT.

AND JUST FROM A SIMPLE STANDPOINT OF UNDERSTANDING WHERE YOUR WATER COMES FROM, RIGHT? UM, PEOPLE, YOU KNOW, DRIVE BY THE PARK ALL THE TIME, THEY HAVE NO IDEA.

AND WHO HARWELL IT WAS THE, I I FIND THAT INTERESTING.

IS ITEM NUMBER THREE, AND IT IS AUTHORIZED, UM, REVISION OF THE RULES AND REGULATIONS, APPENDIX A AND B, AND IMPLEMENTATION OF A NEW WATER CAPACITY, UM, IMPACT FEE.

UM, IF THERE ARE NO FURTHER, UH, COMMENTS OR QUESTIONS, CAN WE HAVE A MOTION AND A SECOND MOTION? MOTION TO APPROVE? A MOTION BY MR. SCOTT, SECOND BY GLORIA CERO.

UH, UM, ALL IN FAVOR? AYE.

ANY OPPOSITION? HEARING NONE, THE MOTION CARRIES.

OUR NEXT ITEM

[3. 23-51637 Approve recommendation to authorize revision of the Long Beach Utilities Department Rules and Regulations Appendix A and B: LBUD Rate Schedule – Charges for Potable Water, Reclaimed Water, and Sewer Service, and implementation of a new Water Capacity Impact Fee. Suggested Action: Approve recommendation. ]

AND THIS REPORT IS DENNIS.

GOOD MORNING COMMISSIONERS.

UM, I HAVEN'T BEEN HERE FOR A WHILE, SO I'D LIKE TO INTRODUCE MYSELF.

MY NAME IS DE SANTOS AND I AM THE MANAGER OF ENGINEERING, UM, OVERSEEING OUR DEVELOPMENT SERVICES DIVISION HERE ON THE WATER SIDE.

AND MY GROUP, UH, PROVIDES ASSISTANCE TO OUR DEVELOPERS HERE IN LONG BEACH.

SO ITEM THREE FROM TODAY'S AGENDA IS RELATED TO OUR DEPARTMENT'S FEE SCHEDULE FOR DEVELOPERS AND THE STUDIES THAT WE CONDUCTED TO HELP WITH THE FEE ADJUSTMENT.

UM, AS THE TITLE OF THE SLIDE HERE SHOWS, THE STUDIES ARE BROKEN INTO TWO SECTIONS, ONE FOR DEVELOPMENT FEES AND THE OTHER ONE FOR WATER CAPACITY FEE.

SO FOR THIS BOARD ITEM, WE ARE REQUESTING BOARD AUTHORIZATION TO REVISE OUR RATE SCHEDULE AND ALSO TO REQUEST IMPLEMENTATION OF NEW WATER CAPACITY FEE AS A NEW CITY IMPACT FEE FOR OUR DEVELOPERS.

ONE OF OUR DEPARTMENT'S KEY FUNCTIONS IS PROVIDING CUSTOMER SERVICE TO DEVELOPMENT ACTIVITIES THROUGHOUT THE CITY.

SO DIFFERENT GROUPS FROM OUR DEPARTMENT PROVIDE THE SERVICES, INCLUDING REVIEW OF DRAWINGS, UM, FLOW TESTING, UH, WATER QUALITY TESTING, INSPECTION SERVICES, CONSTRUCTION SERVICES, UH, DEPENDING ON THE NEEDS OF THE PROJECT.

SO OUR DEPARTMENT CHARGES FEES TO HOVER THE HA OF PERFORMING THE REQUESTED SERVICES, AND THEY'RE BASED ON OUR CURRENT RATE SCHEDULE, WHICH CAN BE FOUND IN APPENDIX A AND B OF OUR RULES AND REGULATIONS FOR, UM, EVERYONE'S INFORMATION.

UM, OUR RATE SCHEDULE HASN'T BEEN UPDATED IN ITS ENTIRETY FOR, UH, MORE THAN 20 YEARS.

AND WE ACTUALLY HAVE SOME, UH, PRINTED DOCUMENTS IN DEVELOPMENT OFFICE INDICATING THAT IT MIGHT HAVE BEEN CLOSE OR EVEN MORE THAN 30 YEARS.

UM, I'VE BEEN WITH THE DEPARTMENT FOR 17 YEARS AND I'VE ONLY SEEN A FEW PARTIAL ADJUSTMENTS TO OUR FEES.

UM, THE LAST UPDATE TO APPENDIX A, UH, WAS IN EARLY 2019, WHICH WERE, UM, RELATED TO CHARGES FOR THE SMART METER PROGRAM.

SO CONSIDERING HOW LONG IT'S BEEN SINCE THE LAST FULL UPDATE, OUR FEE STRUCTURE IS IN GREAT NEED OF FULL MODIFICATION TO ADEQUATELY COVER THE HAA PERFORMING THE SERVICES WE OFFER

[00:20:04]

TO ADDRESS.

TO ADDRESS THE NEEDS FOR THE UPDATE, WE ENGAGE OUR CONSULTANT ELLIS TO CONDUCT STUDIES RELATED TO OUR FEES.

SO THE FIRST SECTION IS A COST OFER SERVICE ANALYSIS TO DETERMINE THE APPROPRIATE COSTS TO CHARGE OUR DEVELOPERS AND COME UP WITH THE RECOMMENDED FEE ADJUSTMENTS.

FOR THE SECOND SECTION, IT'S AN ANALYSIS OF OUR DEPARTMENT'S WATER SYSTEM TO FIGURE OUT THE WATER CAPACITY FEE AND ULTIMATELY RECOMMEND IMPLEMENTATION OF THIS NEW DEVELOPER IMPACT FEE.

FOR THE NEXT FEW SLIDES, I'LL BE FOCUSING ON THE DEVELOPMENT FEE SIDE OF THE STUDY.

OUR CURRENT RATE SCHEDULE INCLUDES AROUND 105 FEE TYPES, AND THEY'RE, UH, BROADLY CATEGORIZED AS EITHER METER OR NON METER TYPE FEE.

AS A QUICK COMPARISON, METER TYPE FEES ARE THE ONES RELATED TO WATER SERVICE INSTALLATION, UM, FOR THE SERVICES MAY BE, UH, ENLARGEMENT, REDUCTION, UH, RELOCATION.

SO BASICALLY ANY WORK THAT WOULD, UM, DIRECTLY IMPACT THE CUSTOMER'S WATER METER FOR THE NON-METAL RELATED FEES, THESE ARE THE TYPE OF WORK THAT ARE INDEPENDENT OF THE METER OR THE METER SIZE.

SO EXAMPLE OF THOSE WORK WOULD BE, UH, REVIEW OF DRAWINGS, UH, PERMIT APPLICATION REVIEW, UH, INSPECTION, OR ANY WORK, UH, RELATED TO SEWER.

SO THE SERVICES WE OFFER LISTED FROM OUR RATE SCHEDULE ARE GENERALLY RELATED TO DEVELOPMENT PROJECTS IN LONG BEACH.

AND, UH, THEY INCLUDE IMPROVEMENTS TO HOMES OR PROPERTIES BY OUR RESIDENTS.

SO WHENEVER THERE'S A PROJECT AND THERE'S A WATER AND SEWER NEED FOR THAT PROJECT, THE DEVELOPERS OR THE RESIDENTS WITH THEIR CONTRACTOR WOULD COME TO US FOR ASSISTANCE.

AS PART OF THE STUDY EFFORTS, OUR CONSULTANT WORK WITH OUR STAFF TO COLLECT DATA FOR THE COST COMPONENTS IDENTIFICATION AND CALCULATION.

THE CONDUCTED, UH, ELLIS CONDUCTED INTERVIEWS AND, UM, THEY INTERVIEWED STAFF WHO WOULD NORMALLY BE INVOLVED WITH PERFORMING THE SERVICES.

FROM THOSE MEETINGS, THEY WERE ABLE TO LIST DOWN THE REQUIRED MATERIALS, EQUIPMENT, UH, VEHICLE, ANY APPLICABLE THIRD PARTY COST, AND, UH, ALSO THE NUMBER OF HOURS REQUIRED BY EACH STAFF MEMBER TO PERFORM THE WORK.

ELLIS WAS ALSO PROVIDED THE FULLY BURDENED HOURLY RATE FOR ALL INVOLVED STAFF MEMBERS.

AND WITH ALL THE GATHERED, UM, COST COMPONENTS, RELLE IS DEVELOPED A FEE CALCULATION TOOL, AND IT IT'S AN EXCEL SPREADSHEET, AND THEY WERE ABLE TO CALCULATE THE UPDATED COST OF PERFORMING THE SERVICES AND THE UPDATED CHARGES, UM, CAN BE SEEN MARKED IN RED ON ATTACHMENT A OF THE BOARD LETTER.

SO ATTACHMENT A IS BASICALLY JUST, UM, COPY OF OUR EXISTING RATE SCHEDULE AND ALL THE PROPOSED OR CALCULATED, UH, CHANGES ARE MARKED IN RED WITH THE UPDATED CHARGES OR AMOUNTS FROM OUR RATE.

SCHEDULE.

ENGINEERING MADE SOME COMPARISON OF THE MOST COMMON TYPES OF SERVICES WE PERFORM, AND THEY'RE USUALLY RELATED TO WATER SERVICE INSTALLATION, SO NEW SERVICE, INSTALLATION, ANY OF THE RELOCATION, UM, EVEN SERVICE REMOVAL.

AND THERE ARE SOME WORK RE RELATED TO FAR FLOW TESTING.

UH, FROM THERE WE LOOKED AT OTHER CITIES, CITIES AND AGENCIES, INCLUDING TORRANCE, HUNTINGTON BEACH, LAKEWOOD, UH, EAST BAY MUNICIPAL UTILITY DISTRICT, AND CITY OF ENGLEWOOD.

AND WE'RE GLAD TO SHARE THAT THE UPDATED COST FOR OUR DEPARTMENTS STAY EITHER WITHIN AVERAGE OR BELOW AVERAGE OF WHAT OTHER CITIES ARE CHARGING THEIR CUSTOMER.

TO GIVE OUR COMMISSIONERS AN IDEA ON HOW WE MADE THE COMPARISON, I ADDED THE GRAPH HERE SHOWING ONE OF OUR MO UH, MOST COMMON TYPE OF WORK WE PERFORM FOR OUR CUSTOMERS, WHICH IS WATER SERVICE INSTALLATION.

SO, AS I SAID, UM, I INCLUDED THE NAMES OF THE AGENCIES I MENTIONED EARLIER.

UM, WE WANTED TO INCLUDE ANAHEIM, UH, CITY OF OAKLAND, UM, CITIES THAT ARE COMPARABLE IN SIZE IN LONG BEACH, UH, AND EVEN LOOKED AT, UH, LA DEPARTMENT OF WATER AND POWER.

BUT UNFORTUNATELY, THEY ALL CHARGE AT COST VERSUS FIXED FEE.

SO THE COMPARISON WOULDN'T WORK, UH, BECAUSE OF THE WAY THOSE CITIES ARE CHARGING FOR THEIR SERVICES.

BUT FOR THIS GRAPH, UM, UNDER THE NAME OF THE AGENCY OR CITIES, UH, NEXT TO THE SERVICE SIZE AS LISTED, UH, WE HAVE THE CORRESPONDING COST TO INSTALL THE SERVICES.

[00:25:01]

WE INCLUDED THREE QUARTER INCH AND ONE INCH BECAUSE THEY ARE THE USUAL SERVICE SIZES FOR RESIDENTIAL.

AND ONE INCH AND TWO INCH ARE THE TYPICAL ONES WE SEE REQUESTED FOR COMMERCIAL CUSTOMERS.

AND CONSIDERING THE, UH, AVERAGE COST OF INSTALLATION FOR ALL THE LISTED CITIES, LONG BEACH WITH OUR UPDATED COSTS STAYED BELOW AVERAGE FOR ALL SIZE CATEGORIES.

JEN, DENNIS, CAN YOU TAKE A SECOND AND JUST EX UM, SHARE WITH THE BOARD WHAT A SERVICE INSTALLATION INVOLVES? YES.

SO, UM, CHRIS, FOR SERVICE INSTALLATION, OUR CREW WILL GO OUT TO THE FIELD, UM, CONNECT TO THE EXISTING, UH, WATER MAIN THAT'S AVAILABLE.

THEY'LL PUT IN THE LINE FROM THE MAIN TO THE SIDEWALK, AND THEY'LL, UH, CONSTRUCT, UH, THE METER AND THE METER SIZE.

SO AS PART OF THAT WORK, WE HAVE TO TAKE CARE OF, UM, THE TRENCH RESTORATION AND STREET RESTORATION.

SO BASICALLY WHEN A CUSTOMER ASKS FOR A BRAND NEW SERVICE INSTALLATION, THE FINISHED PRODUCT FOR THEM WILL BE A METER AND METER BOX, AND THEN THEY CAN CAN CONNECT TO THAT AND BRING THE LINE INTO THEIR PROPERTY OR THE HOUSE.

SO, SO I JUST WANTED THE BOARD TO UNDERSTAND THAT THIS INVOLVES NOT JUST A, A METER, BUT IT ALSO INVOLVES, UH, UH, LINE INSTALLATION ALSO.

LOOKED AT THE VALUE OF OUR DEPARTMENT'S EXISTING INFRASTRUCTURE, WHICH IS DIVIDED INTO FIVE MAJOR COMPONENTS AS LISTED ON THE LEFT SIDE.

I'M NOW GONNA MOVE ON TO THE NEXT SECTION OF OUR STUDY FOR THE WATERY CAPACITY FEE.

UM, AGAIN, AS I MENTIONED, REFILE IS ASSISTED US WITH A SYSTEM ANALYSIS FOR, UH, THE CALCULATION OF THIS PROPOSED FEE.

SO THE MAIN OBJECTIVE OF THE ANALYSIS IS TO DEVELOP A FEE SCHEDULE THAT WOULD REFLECT THE COST OF OUR EXISTING WATER INFRASTRUCTURE AND ALSO, UM, WATER USAGE OF OUR CUSTOMER.

FOR THE DEFINITION, WATER CAPACITY FEE IS A ONE-TIME FEE CHARGE TO CUSTOMERS FOR ANY NEW OR UPSIDE SERVICE CONNECTIONS.

AND IT'S A WAY FOR CITIES TO RECOVER THE COST OF UTILITY IN EXISTENCE.

AND I WANNA MAKE IT CLEAR THAT NONE OF OUR EXISTING, UM, CUSTOMERS WILL HAVE TO PAY FOR THIS FEE UNLESS THEY HAVE A PLANNED PROJECT THAT WOULD REQUIRE MODIFICATION TO THEIR WATER SERVICE.

SO UNLESS THEY HAVE A BRAND NEW, UH, WATER SERVICE REQUEST OR UPSIZE FOR SERVICE CONNECTION, THEY WOULDN'T HAVE TO WORRY ABOUT THIS NEW FEE.

THE FEE REFLECTS THE VALUE OF OUR SYSTEM CAPACITY, AND THIS IS THE AMOUNT, UH, THE CUSTOMER WILL PAY OR BUY INTO, UH, WHICH IS PROPORTIONATE TO THE IMPACT OR DEMAND THE CUSTOMER WILL IMPOSE ON THE WATER SYSTEM AT THEIR POINT OF CONNECTION.

THE POINT OF CONNECTION IS SIMPLY THEIR WATER METER OR WATER SERVICE, UM, FOR THE FEE.

UH, ESSENTIALLY THE CUSTOMER WILL BE PAYING FOR, UH, THE BENEFIT THAT WE, THAT THEY WILL DERIVE, UH, FOR THE EXISTING INFRASTRUCTURE ALREADY IN PLACE READY TO READY TO SERVE THEM.

AND WITH THIS REQUEST FOR NEW IMPLEMENTATION, UH, THE QUESTION IS, ARE WATER CAPACITY FEES APPROPRIATE FOR OUR DEPARTMENT? SO THIS IMPLEMENTATION IS A BOARD POLICY DECISION, AND THAT'S WHY WE'RE HERE TODAY TO ASK FOR, UH, OUR COMMISSIONER'S CONSIDERATION ACROSS SOUTHERN CALIFORNIA.

EVEN WITH THE INCREASED EFFORTS OF WATER CONSERVATION BUILT OUT, CITIES STILL CONTINUE TO CHARGE CAPACITY FEES TO THEIR CUSTOMERS.

UM, THIS GROUP MAY BE AWARE, BUT IF YOU'RE NOT, I'D LIKE TO SHARE THAT OUR DEPARTMENT, UH, CURRENTLY CHARGES SEWER CAPACITY FEE TO OUR DEVELOPERS.

UM, THE CHARGES IS BASED ON THE NUMBER OF FIXTURE COUNT OR UNITS FOR THE BUILDING.

SO WHENEVER THERE'S A NEW BUILDING OR MAJOR MODIFICATION TO THE BUILDING AND THERE'S CHANGES TO THEIR PLUMBING, THEN UH, IT WOULD TRIGGER FOR THIS FEE TO BE CHARGED TO THE DEVELOPER.

AFTER DOING SOME RESEARCH, WE FOUND OUT THAT THERE ARE ITIES CHARGING WATER CAPACITY FEE TO THEIR CUSTOMERS, INCLUDING CITY OF HUNTINGTON BEACH, INGLEWOOD CITY OF AZUA, BEVERLY HILLS, AND CITY OF PASADENA.

SO SAR CHARGING SUCH UH, FEES IS AN ALLOWABLE INDUSTRY STANDARD PRACTICES BY AM AMERICAN WATER WORKS ASSOCIATION AND CALIFORNIA LAW, SPECIFICALLY GOVERNMENT CODES SECTION 6 6 0 1 3 ALLOW PUBLIC AGENCIES, JUST LIKE THE ONES I MENTIONED IN ALSO LONG BEACH TO IMPOSE CHARGES TO NEW DEVELOPMENT PROJECTS THAT RESULT IN AN IMPACT ON THE SYSTEM.

FOR THE CAPACITY FEE CALCULATION, OUR CONSULTANT USED WHAT'S CALLED EQUITY BUY-IN METHOD, WHICH IS THE STANDARD APPROACH FOR CITIES THAT ARE, UH, NEARLY FULLY DEVELOPED, BUT AT THE SAME TIME HAS ADEQUATE SYSTEM CAPACITY FOR FUTURE DEMAND.

SO THIS IS THE CASE FOR LONG BEACH.

THIS METHOD

[00:30:01]

SO THAT INCLUDES TREATMENT, TREATMENT AND TRANSMISSION RESERVOIR, PUMPING WILSON AND WATER RIGHTS, AND OUR DISTRIBUTION SYSTEM.

AND AS PART OF THE PROCESS, THE STUDY DETERMINED THE NUMBER OF THREE QUARTER INCH EQUIVALENT CONNECTIONS THAT OUR, UH, DEPARTMENT COULD SERVE.

AND BY TAKING THE TOTAL VAR VALUE OF OUR EXISTING INFRASTRUCTURE AND DIVIDING IT BY THE NUMBER OF THREE QUARTER INCH EQUIVALENT CONNECTIONS, ELLIS WAS ABLE TO CALCULATE THE PROPOSED CAPACITY FEE OF MORE THAN $2,500.

SO THIS AMOUNT, UH, PROPOSED TO BE CHARGED WOULD BE FOR EVERY THREE QUARTER INCH SIZE WATER METER.

AND AGAIN, UM, FOR OUR REGULAR CUSTOMERS, UNLESS THEY ASK FOR, UH, NEW SERVICE CONNECTION OR UPSIZE CONNECTION, THEY DON'T HAVE TO PAY FOR DISCHARGE.

AND ATTACHMENT A, UM, SPECIFICALLY ON THE FIFTH SHEET, UH, THE SHEET WOULD SAY PAGE 81, IT SHOWS THE RED LINE VERSION OF THE FEE ASSESSMENT SCHEDULE.

SO IT SHOWS THE THREE QUARTER INCH AND THIS CALCULATED AMOUNT, AND IT INCREASES AS THE SIZE OF THE METER GOES UP.

WE WANTED TO SHOW OUR COMMISSIONERS ANOTHER COMPARISON, UM, SHOWING OTHER CITIES ALREADY CHARGING THIS PROPOSED FEE.

AND WITH THIS GRAPH, WE ARE SHOWING, UH, THE LI THE CITIES AS LISTED HERE WITH LONG BEACH ON THE FIRST COLUMN.

AS YOU CAN SEE, OUR PROPOSED CHARGES BASED ON THE METER SIZE, SAME SIZES THAT WE USE FOR WATER SERVICE INSTALLATION OF THREE QUARTER INCH, ONE INCH AND TWO INCH, OUR CHARGES ARE EITHER COMPARABLE OR WAY BELOW WHAT OTHER CITIES ARE CHARGING, ESPECIALLY IN COMPARISON WITH INGLEWOOD, BEVERLY HILLS AND PASADENA.

WITH ALL THE REQUESTED CHANGES TO OUR RATE SCHEDULE, WE ARE EXPECTING AN INCREASE IN REVENUE, UH, BUT ACTUAL NUMBERS ARE UNKNOWN AT THIS TIME.

FOR THE WATER FUND, WE DID SOME CALCULATION AND WE CONSIDERED, UH, PREVIOUS PERFORMANCE AND HOUNDING DATA FROM, UM, PREVIOUS FISCAL YEAR.

AND LOOKING AT OUR MOST COMMONLY CHARGED SERVICES, WE WERE ABLE TO CALCULATE BETWEEN 1.1 MILLION AND 2.1 MILLION, UH, DOLLARS.

AND THE 1.1 MILLION AMOUNT WAS INCLUDED IN THE FY 24 BUDGET AS A LOW END ESTIMATE FOR THE SEWER FUND.

UM, FOR THE INCREASED REVENUE FOR THE SEWER FUND, IT'LL JUST DEPEND ON THE VOLUME OF DEVELOPMENT PROJECTS RECEIVED, UH, BY THE DEPARTMENT.

AS A QUICK RECAP, UPDATING OUR FEES, WHICH HASN'T BEEN UPDATED IN ITS ENTIRETY FOR CLOSE TO 30 YEARS, WILL HELP ENSURE COST OF, UM, PERFORMING SERVICES BY THE DEPARTMENT ARE FULLY DEVELOPED OR FUNDED.

AN IMPLEMENTATION OF NEW WATER CAPACITY FEE TO BE ASSESSED ONLY FOR NEW OR UPSIZE SERVICE CONNECTIONS COULD HELP WITH COST RECOVERY OF PAST UTILITY INVESTMENT.

AND I JUST WANT TO MENTION AGAIN, THAT OUR, UH, EXISTING CUSTOMERS WILL NOT BE IMPACTED BY THE CHANGES TO THE FEE SCHEDULE AND IMPLEMENTATION OF THE NEW FEE UNLESS THEY HAVE, UH, CHANGES TO, UH, THEIR ACCOUNT OR IF THEY HAVE ANY PROJECT THAT WOULD REQUIRE MODIFICATION TO THEIR WATER OR SEWER CONNECTIONS.

SO ATTACHMENT A, AS I MENTIONED EARLIER, ARE THE, UM, PROPOSED CHANGES TO OUR RATE SCHEDULE, AND ATTACHMENT B SHOWS THE DOCUMENT'S FINAL VERSION IF CHANGES ARE APPROVED AND IMPLEMENTED.

IF APPROVED BY THE BOARD.

TODAY, OUR PROPOSED EFFECTIVE DATE IS FEBRUARY 2ND, UH, TO ALLOW STAFF MAKE FINAL ADJUSTMENT TO OUR RATE SCHEDULE.

AND IT'LL GIVE US TIME TO CHANGE ANY OF OUR HOSTED, UM, FEE SCHEDULE, INCLUDING OUR WEBSITE, OUR UTILITY BILLING SYSTEM, OR ANY PRINTED MATERIALS TO BE SHARED WITH, UM, OTHER CITY DEPARTMENTS AND OTHER AGENCIES.

AND WITH ALL THE PRESENTED INFORMATION, AND I UNDERSTAND IT'S A LOT, STAFF RECOMMENDS OUR BOARD TO AUTHORIZE A REVISION OF OUR WILSON REGS, APPENDIX A AND B AND IMPLEMENTATION OF A NEW WATER CAPACITY FEE.

AND THIS CONCLUDES MY REPORT, AND I'LL BE HAPPY TO ANSWER ANY QUESTIONS YOU MAY HAVE.

ARE THERE ANY PUBLIC COMMENTS? ARE THERE ANY PUBLIC COMMENTS? UM, COMMISSIONER, I HAVE A QUESTION.

AS A COMMISSIONER, WHY HAVEN'T THE THEMES BEEN UPDATED IN 30 YEARS? YEAH.

UM, PRESIDENT, UM, RAINEY, THAT'S A VERY GOOD QUESTION,

[00:35:01]

AT LEAST BASED ON WHAT I KNOW, UM, UH, COST OF SERVICE ANALYSIS WOULD BE REQUIRED TO TAKE ON SUCH BIG, I'M SORRY.

PLEASE HELP ME.

I THINK I'M GONNA HAVE TO GET SOME HEARING AIDS.

SURE.

I'M SORRY ABOUT THAT.

UH, PRESIDENT, UH, RAINEY, UM, WE UNDERSTAND THAT SUCH A BIG, UM, EFFORT TO UPDATE OUR FEE SCHEDULE, UH, WOULD REQUIRE A COST OF SERVICE ANALYSIS.

AND, UM, I GUESS IT'S JUST THE TIMING.

WE NEVER HAD A CHANCE TO, UM, HIRE A CONSULTANT TO DO THAT FOR US.

UM, I'M NOT SURE IF CHRIS AND ANTO WOULD HAVE A ADDITIONAL INPUT TO THIS, BUT WE JUST NEVER HAD A CHANCE TO LOOK INTO, UH, PERFORMING, UH, AN ANALYSIS WHICH WOULD BE REQUIRED FOR, UM, UPDATING OUR FEE SCHEDULE.

AND, AND TO CLARIFY, WE HAVE ON OCCASION, UH, MADE CHANGES TO THE FEE SCHEDULE, JUST BITS AND PIECES, PARTIAL ADJUSTMENT.

YOU'RE TALKING ABOUT A FULL, NOT A FULL ONE, RIGHT? WE HAVEN'T NOT DONE A FULL ONE IN 30 YEARS.

UM, ANY OTHER COMMISSIONER'S COMMENTS OR QUESTIONS? OKAY, MS. MCGUIRE, I HAVE A LOT OF QUESTIONS.

I'M SURE OTHERS DO TOO.

UM, OKAY.

THESE, UH, THE PROJECTED REVENUE FROM, FROM THIS IMPLEMENTATION, IT'S 1.1 TO 2.6 MILLION, IS THAT CORRECT? CORRECT.

IS THAT, DOES AND THAT INCLUDES THE WATER, UM, WHAT IS IT WATER CAPACITY FEE, THE CAPACITY, THE NEW, THE NEW FEE? CORRECT.

SO IT'S A RANGE, UM, COMMISSIONER, BECAUSE 1.1 IS, UH, JUST FOR THE UPDATE OF THE FEE SCHEDULE.

SO THE 2.6 PORTION OF IT IS WHEN WE ARE TO, UH, APPLY THE WATER CAPACITY FEE TO THE CHARGES.

THAT'S WHY IT'S A RANGE.

SO WITHIN THAT, HOW MUCH OF THAT WOULD BE NEW MONEY? I MEAN, IT'S OBVIOUSLY ALL NEW MONEY, BUT WHAT PERCENTAGE WOULD BE THE CAPTURE FEE DO? SO FOR THE WATER CAPACITY FEE, IT'S THE ADDITIONAL ONE POINT, UM, 1.6.

SO THAT'S THE NEW.

WOW.

THIS IS, THIS IS A NEW FEE FEE.

SO IT'S, IT'S PAID FOR BY THE DEVELOPER.

I GET THAT ONLY FOR A BRAND NEW SERVICE CONNECTION OF THEIR, OR IF THERE'S ANYONE WITH EXISTING CONNECTION WHO ASK FOR AN UPSIZE OR UPGRADE TO THEIR, UH, METER, IT'S PRETTY STEEP FEE.

IT'S, IT'S A SIGNIFICANT AMOUNT OF MONEY.

AND, AND IT'S INTERESTING, THE, YOU KNOW, THE MODEL YOU PUT TOGETHER THAT THEY PUT TOGETHER TO FIGURE OUT WHAT FORMULA WOULD BE USED, THE VALUE OF THE INFRASTRUCTURE WAS CORRECT, WAS THE FIRST THING THAT WAS LOOKED AT, RIGHT? YES.

SO, HMM.

SO YOU'RE JUST PUTTING THIS FEE ON DEVELOPERS, COMMISSIONER MCGUIRE? YEAH, SO THE CONCEPT IS THE SAME CONCEPT THAT WE CURRENTLY APPLY AND HAVE CONSISTENTLY APPLIED OVER THE YEARS TO THE SEWER SYSTEM.

SO WE ALREADY CHARGED THIS FEE, WE CHARGE THIS FEE ON THE SEWER SYSTEM.

AND THE CONCEPT IS THAT WHEN YOU CHANGE THE NATURE OF YOUR SERVICE ON YOUR PROPERTY AND YOU'RE GOING TO INCREASE IT, THAT CONCEPT IS THAT NOW YOU'RE GOING TO TAKE THAT ADDITIONAL CAPACITY AND YOU'RE GONNA BUY INTO A SYSTEM THAT IS THERE AND READY TO DELIVER TO YOU.

AND SO THAT'S WHY IT'S THE VALUE OF THE ENTIRE SYSTEM.

AND THAT ENTIRE SYSTEM OVER THE ADDED CAPACITY THAT YOU'RE SEEKING IS WHAT YOU'RE GOING TO BE CHARGED.

IT'S VERY COMMON AND CONSISTENT WITH SEWER USAGE AND IT'S ALSO CONSISTENT WITH WATER USAGE.

IT'S JUST THAT WE HAVEN'T BEEN APPLYING IT IN THE PAST.

SO THERE'S QUITE A BIT OF LOST REVENUE THERE FOR A LOT OF YEARS.

AS AS A MATTER AS I WOULD SAY, AS A MATTER OF PRACTICE, YEAH.

AS A MATTER OF PRACTICE THAT REPRESENTS REVENUES THAT HAVE BEEN UNRECOVERED IN THE PAST.

EXACTLY.

AND THEN, SO THIS, IT SAYS SOMEWHERE THAT THIS IS BASICALLY CATCH-UP MONEY THOUGH, FOR WHAT WAS ALREADY SPENT THAT WE WEREN'T REIMBURSED FOR.

COULD YOU ASK ME THAT QUESTION AGAIN? UM, THERE'S A STATEMENT SOMEWHERE IN HERE THAT THIS, THIS FUNDING HELPS COVER THE COST OF THE DEVELOPMENT THAT WE'VE DONE IN THE PAST TO BUILD OUR WATER CAPACITY AND TOLD IT'S TO RECOVER THE COST OF EXISTING INFRASTRUCTURE.

SO COMMISSIONER IS CORRECT? I'M CORRECT.

COST, WHICH IS THE RESPONSIBLE WAY TO CHARGE THEM.

SO IT'S NOT GONNA HELP US IN THE FUTURE, BUT IT WILL EVENTUALLY.

IT IS RECAPTURING COSTS ALREADY SPENT.

YES.

IT'S A WAY OF TRULY ASSESSING THE IMPACTS ACROSS THE BOARD.

AND SO CUSTOMERS THAT ARE CURRENTLY EXISTING CUSTOMERS DON'T BEAR THAT COST THE DEVELOPER WHO IS ACTUALLY CAUSING A CHANGE TO THE SYSTEM, THEY'RE BEARING THAT

[00:40:01]

AND, AND TO CLARIFY ONE MORE THING.

ONE, ONE OF THE THINGS THAT WE'RE TRYING TO DO WITH, UH, DEALING WITH THE DEVELOPERS IS MAKE SURE THAT, UM, THE DEVELOPERS ARE COMING ONTO OUR SYSTEM, ARE PAYING THEIR, THEIR COSTS RATHER THAN THOSE COSTS BEING ABSORBED BY ALL OTHER CUSTOMERS.

'CAUSE IF THEY, IF WE DON'T CHARGE THE DEVELOPERS, THEN THOSE COSTS ARE BORNE BY THE OTHER CUSTOMERS.

ANY OTHER, UH, COMMISSIONER'S COMMENTS? GLORIA? JUST, JUST, I DON'T KNOW IF THIS IS A QUESTION OR JUST A, MAYBE A STATEMENT THAT SOMETHING BECOME REALLY KIND OF POLITICAL.

UM, WHAT HAPPENS WITH A, AT SOME POINT, I KNOW DEVELOP ADUS.

I MEAN WE'RE, WE'RE THERE'S SO MANY POPPING UP NOW.

I MEAN, DO WE SEE SOMETHING LIKE THIS COMING AROUND? THIS WOULD APPLY TO ADUS, CORRECT? DIDN'T IT THIS APPLY TO ADU? OH, IT DOES, ESPECIALLY IF THEY ASK FOR SEPARATE SERVICE CONNECTION, THEN IT WOULD APPLY.

UH, EVEN IF, LET'S SAY THE PROPERTY HAS AN EXISTING WATER METER, IF THE SIZE OF THE METER IS NOT SUFFICIENT, THEN THEY WILL HAVE TO ASK FOR AN UPSIZE OR AN UPGRADE.

SO THIS FEE WILL APPLY TO THOSE TYPES OF PROJECTS.

I I THINK THAT'S, THAT'S GOOD.

IT'S A BETTER PRACTICE TO ESTABLISH ACTUAL COSTS, USE THOSE AS THE BASIS FOR YOUR FEES, AND THEN REVIEW THEM AS OFTEN AS YOU, AS IS FINANCIALLY FEASIBLE RATHER THAN APPLY A CPI.

IF WE DON'T HAVE ANY OTHER, OH, OKAY.

SCOTT, UH, JUST A FEW COMMENTS AND QUESTIONS, I GUESS.

SO KUDOS TO CHRIS AND ANTO FOR, FOR SPEARHEADING THIS.

UM, I THINK IT'S, IT'S DEFINITELY LONG OVERDUE.

UH, I THINK IT'S FAIR AND REASONABLE THAT DEVELOPERS, INCLUDING DEVELOPERS OF ADUS, WHICH ARE, YOU KNOW, REGULAR HOMEOWNERS, UM, BEAR THE COST OF RECOVERING THE, THE MATERIAL EQUIPMENT LABOR.

UM, I, I THINK IT'S FANTASTIC.

UM, I EQUATE IT A LITTLE BIT TO, UH, HOW WE REIMBURSE, UH, FLEET OR TI OR THE CITY ATTORNEY FOR, FOR SERVICES THAT THEY PERFORM ON BEHALF OF THE UTILITY DEPARTMENT.

UH, I I THINK THAT'S FAIR AND REASONABLE AS WELL.

UM, COUPLE QUESTIONS.

THE, SO WE'RE THIS IS ALL WATER AND, AND SEWER DOES CORRECT.

WOULD THESE FEES IMPACT GAS? THIS STUDY IS ONLY ON THE WATER AND SEWER SIDE.

AND IS THERE A SEPARATE FEE STRUCTURE FOR GAS? UM, YES, THERE IS BRANDON, COMMISSIONER SCOTT.

SO, UM, WHEN THE GAS DEPARTMENT WAS PART OF ENERGY RESOURCES, THEY WERE ACTUALLY PART OF A CITYWIDE COST OF SERVICE STUDY SIMILAR TO THIS STUDY HERE.

UM, WE'RE ANALYZING RESULTS AND, AND DO PLAN ON COMING BACK TO THE BOARD AND OVER THE NEXT FEW MONTHS TO KIND OF GO OVER THOSE RESULTS AND, UH, GIVE THE BOARD DECISIONS ON WHERE THEY WOULD LIKE TO ADJUST FEES.

SO THE SHORT ANSWER TO YOUR QUESTION, YES, THERE'S A SEPARATE FEE SCHEDULE THAT WE'RE PLANNING TO BRING TO YOU IN THE NEXT FEW MONTHS.

OKAY, GOOD.

UM, SO 30 YEARS ON THIS MASSIVE OVERHAUL, UM, UH, IT'S QUITE A LONG TIME.

HAVE WE CONSIDERED IMPLEMENTING SOME SORT OF A, I I'M ALWAYS CONCERNED ABOUT FIXED NUMBERS IN A FEE SCHEDULE, UH, BECAUSE OVER TIME, OBVIOUSLY THOSE ARE, ARE LOSING VALUE TO US.

UM, IS THERE ANY CONSIDERATION OF ADDING A, A COST OF LIVING ADJUSTMENT, A COLA OF SOME SORT INFRASTRUCTURE? ONE, ONE APPROACH, WHICH WOULD AGAIN BE A QUESTION OF JUST UTILITY PRACTICE, IS THAT, UM, THE RATES THAT WE CHARGE ALL CUSTOMERS FOR WATER CONSUMPTION, THEY ALSO HAVE AN ASSOCIATED COST OF SERVICE STUDY.

AND AS A MATTER OF PRACTICE, WE TEND TO REVIEW THAT ANALYSIS ABOUT ONCE EVERY FIVE YEARS.

SO IT WOULD BE PRUDENT AS A UTILITY PRACTICE TO INCORPORATE A, UH, A STUDY RELATED TO THE FEES IN THE SAME MANNER THAT WE'RE LOOKING AT THE RATES, IT'S COST OF SERVICE BASED.

AND WE JUST TRULY ASSESS AT THAT TIME, IS THERE A NEED FOR ANY ADJUSTMENTS, AND IF SO, TO WHAT DEGREE THAT IS A BETTER COST OF SERVICE APPROACH THAN JUST SIMPLY CPIE EVERY YEAR.

BECAUSE THAT COULD ALSO SKEW YOU IN A PARTICULAR WAY WHERE YOU DON'T REFLECT THE, THE TRUE COST OF SERVICE.

UNDERSTAND.

SO ARE WE IMPLEMENTING THAT GOOD PRACTICE? IS THAT I BELIEVE WE ARE, I'M, I'M LOOKING AT, AT RICH WHO WANTS TO SPEAK? I THINK, WELL, I JUST WANTED TO AGREE WITH YOU THAT UNDER NORMAL CIRCUMSTANCES, I WOULD SAY A CPI IS A GREAT WAY TO GO.

IT MAKES THINGS SIMPLER, BUT BECAUSE WE'RE LIMITED, NOT LIMITED, BUT WE ARE SUPPOSED TO BE TRACKING OUR ACTUAL COST TO SERVICE AS MUCH AS POSSIBLE, THE BETTER WAY TO GO IS TO DO THIS AT, AT A MORE FREQUENT INTERVAL THAN 30 YEARS.

UH, EVERY FIVE WOULD BE, WOULD BE GREAT.

I, AND I KNOW I DIG DIGRESSED, BUT REFUSE HAD, UH, IN, THEY'RE UNDER PROP TWO 18, THEY HAD CPI ON THEIR REFUSE RATES FOR A WHILE.

I DUNNO IF THEY STILL DO.

THEY DID.

AND IT'S IMPORTANT WHEN THEY DO IT.

SO IT'S VERY IMPORTANT UNDER PROP TWO 18 THAT IF YOU'RE GONNA DO CPI THAT, THEN YOU, WHEN YOU ADOPT THE RATES, YOU'RE VERY CLEAR ABOUT EXACTLY WHAT INDEX YOU'RE GONNA USE AND YOU PROVIDE ESTIMATES OF HOW THIS MIGHT DRIVE THE RATES.

BUT IN THIS CASE, WE'RE TALKING ABOUT FEES, YOU KNOW, AS OPPOSED TO RATES.

SO I DON'T KNOW THAT IT'S QUITE THE SAME.

BUT IN GENERAL, I THINK

[00:45:01]

BUT THE FLIP SIDE, GOING BACK TO REFUSE, UH, TALKING TO MY REFUSE FRIENDS, WAS THAT THEY DID NOT HAVE TO GO BACK TO COUNCIL ALL THE TIME TO RAISE THEIR RATES.

IT WAS, IT, IT WAS APPROVED BY CITY COUNCIL TO ADD THE, UH, COLA ON TOP OF THE REFUSE RATES AND THE REFUSE RATES WERE ADJUSTED EVERY YEAR, UM, WITHOUT HAVING TO GO BACK TO COUNCIL.

I, I BELIEVE I'M NOT, I'M NOT SAYING THAT WE DO THAT.

I I WAS JUST CURIOUS.

SO ARE, MAYBE YOU ANSWER MY QUESTION.

SO ARE, ARE WE COMMITTING TO IMPLEMENTING A, A PLAN TO, TO REVIEW THE COST OF SERVICES EVERY PERIODICALLY? YES.

OUR, OUR GOAL IS WITH THE COST OF SERVICE STUDY, WE WOULD INCORPORATE A REVIEW OF FEES.

PERFECT.

COMMISSIONER SA ONE LAST COMMENT TO THAT, THAT QUESTION.

I THINK THE, THE PRACTICE THAT, THE GOOD THING ABOUT THIS WORK THAT DENNIS AND HIS TEAM HAS DONE IS GIVEN US THE MODEL.

THE HARDEST PART IS, IS DEVELOPING A COHERENT, DEFENSIBLE MODEL IN COURT OF HOW DO YOU ACTUALLY CAPTURE COSTS.

WE HAVE THAT FRAMEWORK NOW.

SO THE SHORT ANSWER TO YOUR QUESTION IS, YEAH, WE WOULD PLUG IN AT LEAST ANNUALLY WHAT THOSE FIGURES WOULD BE.

AND THEN OBVIOUSLY AS PART OF THE BUDGET DISCUSSION WITH, WITH THE COMMISSIONERS TO DECIDE WHETHER OR NOT IT'S, IT'S SUITABLE TO RAISE FEES IN ANY GIVEN YEAR.

I THINK WHAT CHRIS IS POINTING TO IS THE, THE, THE SITUATION YOU GET INTO HERE IS WHEN YOU WAIT 1, 2, 3, 5, 10, 15, 20 YEARS, YOU GET STICKER SHOCK.

SO THE SHORT ANSWER TO YOUR QUESTION IS, YES, WE WILL REVIEW THIS ANNUALLY.

PERFECT.

ANY OTHER COMMISSIONER'S COMMENTS? OKAY, HEARING NONE, DO WE HAVE A MOTION? MOTION TO APPROVE, UH, POP SLOW DOWN.

I KNOW YOU WANNA GO.

, I'M MESSING WITH YOU.

UH, MOTION BY BOB.

AND THE SECOND BY MOTION.

SECOND.

MOTION SECOND BY GLORIA.

ALL IN FAVOR? AYE.

AYE.

ANY OPPOSITION? HEARING NONE.

IT PASSES.

ITEM NUMBER FOUR, BEFORE YOU GO ON.

THANK, THANK YOU VERY MUCH, DENNIS, FOR ALL THE WORK THAT YOU AND YOUR TEAM PUT INTO THIS.

I, I KNOW IT WAS A LOT OF WORK AND IT'S BEEN GOING ON FOR WHAT, A COUPLE YEARS AT LEAST.

YES, ? YES.

IT'S A GROUP EFFORT.

CHRIS , INCLUDING YOU GUYS.

, THANK YOU SO MUCH.

THANK, THANK YOU VERY MUCH.

AND I'M GONNA GET SOME HEARING AIDS.