Report Prepared by: Leah Brown, Water Conservation Specialist, Public Works
Title
SUBJECT: Draft Report of the Water Rate Study and Request to Set a Public Hearing Following the Proposition 218 Notification
REPORT IN BRIEF
Presentation of the Draft Water Rate & Capital Facility Charge Study.
RECOMMENDATION
City Council - Adopt a motion:
A. Approving the Water Rate and Capital Facility Charge Study report; and,
B. Authorizing staff to proceed with the Public Notification process following Proposition 218 guidelines; and,
C. Setting a Public Hearing for October 15, 2018, at 6:00 PM to approve the amended rates.
Body
ALTERNATIVES
1. Approve the changes to the water rates and Capital Facility charges, direct staff to proceed with the Prop 218 process, and set a Public Hearing for October 15, 2018; or
2. Accept the changes to the water rates and Capital Facility charges, approve staff to proceed with the 218 process, and set a different date for the Public Hearing; or,
3. Deny the water rates and Capital Facility charge changes as recommended; or
4. Refer to staff for further study;
5. Continue action until a future City Council meeting, specifying date.
AUTHORITY
Article II, Section 200, Article IV, Section 405, and 15.32.060 - Special and Amended Rates - Authority of the Merced Municipal Code (MMC), and relevant sections of the State Constitution and State law.
CITY COUNCIL PRIORITIES
As provided for in the 2018-2019 Adopted Budget.
DISCUSSION
The City last revised its water service charges in 2012 with no increases through the year 2017. On January 1, 2018, the base water service charge was adjusted based on a formula set forth in MMC Section 15.36.045.
The rate setting process requires the analysis of revenue requirements and cost to provide service while meeting the policy and revenue requirements of the City. Factors taken into consideration to develop the financial forecast include a 1% growth rate, cost inflation over the 5 year pro...
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