HomeMy WebLinkAbout5/17/2000 - STAFF REPORTS (19) DATE: May 17, 2000
TO: City Council
FROM: Assistant City Manager-Special Projects
SEWER SERVICE CHARGE RATE BASE POLICY
It is recommended that City Council establish policy statements,effective July 1,2000,
on the costs to be included in the Sewer Service Charge rate base.
BACKGROUND:
Proposition 218 established the principle thatfees charged fora service should reflect
the total cost of that service. Proposition "U", passed in November by the Palm
Springs voters, reemphasized the principles of Proposition 218.
The sewer charge rate base in the past has included an In-Lieu Property Fee and a
calculated Administrative Services charge, but not the full debt service on the existing
bond issue. Only about 10% of the bond debt service was allocated to the Sewer
Service Charge, the remainder of the debt payments came from the Sewer Facility
Fees, interest earnings from the Wastewater Treatment Plant Fund reserves and the
reserve itself. The attached Resolution, if adopted by City Council, would establish
a policy that the Sewer Service Charge rate base shall include:
a) Full Operations & Maintenance Costs
b) City Direct Charges for Services
c) Motor Vehicle Replacement Fees
d) Property Leases
e) Debt Service
f) Insurance
g) Other Allowable Charges under Prop 218
The attached Resolution is offered for City Council consideration.
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ALLEN F. SMOOT, AAE
Assistant City Mana r-Special Projects
APPROVED
6City Manager
ATTACHM NT:
Resolution
RESOLUTION NO.
OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS, CALIFORNIA, SETTING
POLICY CONCERNING SEWER SERVICE
FEE RATE BASE COMPONENTS.
WHEREAS Proposition 218, as passed by State of California voters in November 1996,
provides that fees (1) should not exceed the funds requiredto provide the service, (2) shall
not be used for purposes other than that for which they were imposed, (3) shall not exceed
the proportional cost of the service attributable to the parcel, (4) shall not be charged unless
the service is available, (5) may not be charged for general governmental services; and
WHEREAS the Palm Springs voters reemphasized principles of Proposition 218 when they
passed Proposition "U" in November of 2000, which prohibited the sale or lease of the
Wastewater Plant to a private entity and enacted restrictions on fees similar to Proposition
218; and
WHEREAS the City, with the assistance of Integrated Utilities Group, Inc., is in the midst of
developing a new sewer rate program which will be consistent with Proposition 218 and must
establish a policy on all the costs which should be placed in the rate base and shall utilize the
components worded herein, and
NOW THEREFORE BE IT RESOLVED that the City Council hereby establishes the following
policy:
Section 1. The Sewer Service Charge rate base shall be made up of the following cost
components which arise from the operation, maintenance and construction of
facilities for the processing and treatment of sewage including:
A. Full Operation & Maintenance Costs including personnel charges
B. Direct Contract Charges for Services
C. Fees for Motor Vehicles used in connection therewith
D. Leases for property in connection therewith
E. Debt Service for wastewater treatment facilities
F. Insurance Costs
G. Other related charges or Allowable Charges Under Proposition 218
Section 2. The Sewer Charge rate Base shall not include administrative fees or charges
by the City collected for General Fund purposes except reimbursement of
direct charges by contract.
I to 42W
Resolution for Sewer Service Fee Rate Base
May 17, 2000
Page Two
ADOPTED this day of 12000.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS, CALIFORNIA
By:
City Clerk City Manager
REVIEWED &APPROVED AS TO FORM
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