HomeMy WebLinkAbout11/18/2015 7B AGENDA BILL
CITY OF BREMERTON � �
CITY COUNCIL .
SUBJECT: Ordinance No. 5288 amending Study Session Date: 11/10/15
BMC Chapters 15.01 & 15.06 and Ordinance COUNCIL MEETING Date: 11/18/15
No. 5265 relating to Assessments, Rates, Department: PW&U
Fees, and Charges for Water, Wastewater, Presenter: Chal MartinlWayne
and Stormwater Services Hamilton/Cathy Johnson
Phone: (360) 473-5207
SUMMARY: The City retained Financial Consulting Solutions Group (FCS) to perform a general
facilities charge (GFC) update for water, wastewater and stormwater utilities, as well as a review of
the City's miscellaneous fee schedule. The last GFC update was in 2009.
The study analyzed existing and future expenses related to system growth, and determined the
Equivalent Residential Unit"maximum allowable charge"for each utility. The City may charge less,
but not more. However, should the City adopt lower GFCs than indicated by the analysis, the
existing customer base would be subsidizing system expansion.
Staff is recommending a methodology change for calculating wastewater GFCs. The change would
base wastewater GFCs on water meter size, instead of the City's current methodology which uses
fixture counts and other metrics.
At the Council's request, staff met with the Home Builders Association, Association of Realtors and
the Rate Payer Advisory group in a Stakeholder meeting September 29�h to discuss the proposal.
The HBA and Realtors were concemed about the impact the large GFC increase would have on new
home starts; also, concem was raised about wastewater GFCs for large residential developments,
which the HBA and Realtors perceived as subsidizing these developments. In addition, the HBA and
Realtors requested that the City adopt a process enabling GFC payments to be made later in the
development process, rather than up-front. Also, the HBA and Realtors requested that the GFC
increase be phased in over three years. This proposal adopts those requests, and in addition
grandfathers the existing fee basis for current developments on the books. However, this proposal
does not recommend adopting a lower GFC than recommended by the FCS study; nor does this
proposal recommend reverting back to the old methodology for calculating the wastewater GFC.
The FCS study also provided an analysis of the City's fees and charges for services provided. This
analysis is straight forward; the fully-loaded labor rate calculation for City utility services is $67.38 per
hour. Exhibit B incorporates this calculated rate.
Finally, not directly related to the issues above, Exhibit B incorporates 2016 rate increases for the
City's three utilities— 1.25% for Water; 2.25%for Sewer; and 3.75% for Storm. These increases all
track below the 2012 rate study expectations. These increases are necessary to support the
operation and Capital programs of the City's three utilities.
The proposed ordinance amends and updates BMC Chapters 15.01 and 15.06 and Ordinance No.
5265 relating to assessments, rates, fees, and charges for water, wastewater and stormwater
services. The rates and fees set forth in the attached exhibits to the proposed ordinance are
recommended by staff, comport with the FCS study, and include consideration of the Realtor and
HBA inputs.
ATTACHMENTS: 1) Ordinance No. 5288 with Exhibits A and B; and 2) Background Information
FISCAL IMPACTS (Include Budgeted Amount): The study concluded the recommended rates are
required to meet cost of service expenses for development activities, and recover system extension
costs. Partial implementation of study recommendations will result in ratepayers subsidizing new
development and will also result in utility budget shortFalls.
STUDY SESSION AGENDA: O No Presentation � Full Presentation
STUDY SESSION ACTION: ❑ Consent Agenda o General Business 0 Public Hearing
RECOMMENDED MOTION: Move to pass Ordinance No. 5288 amending Chapters 15.01 and
15.06 of the Bremerton Municipal Code and Ordinance No. 5265 relating to assessments, rates, fees
and charges for water, wastewater and stormwater services.
COUNCIL ACTION: [�Approve ❑ Deny ❑ Table ❑ Continue ❑ No Action
Form Updated 01/07/15