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Home My WebLink AboutCOUNCIL - AGENDA ITEM - 11/01/2011 - ITEMS RELATING TO UTILITY RATES, FEES AND CHARGESDATE: November 1, 2011 STAFF: Brian Janonis Ellen Switzer AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 13 SUBJECT Items Relating to Utility Rates, Fees and Charges for 2012. A. Second Reading of Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges. B. Second Reading of Ordinance No. 139, 2011, Amending Chapter 26 of the City Code to Revise Water Plant Investment Fees. C. Second Reading of Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges. D. Second Reading of Ordinance No. 141, 2011, Amending Chapter 26 of the City Code to Revise Sewer Plant Investment Fees. E. Second Reading of Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees. EXECUTIVE SUMMARY Ordinance No. 138, 2011, proposes a 6% water rate increase. The increase is across the board and applies to all rate classes. Ordinance No. 139, 2011, will increase water plant investment fees an average of 4.7% for 2012. Ordinance No. 140, 2011, will increase wastewater rate by 8% for 2012. Ordinance No. 141, 2011, will decrease the wastewater plant investment fees by 3% for 2012. Ordinance No. 144, 2011, will increase the Stormwater plant investment fees by 1.2% in 2012. These Ordinances were unanimously adopted on First Reading on October 18, 2011. During the discussion on First Reading, Council requested additional explanation and graphics related to the monthly water and wastewater rate increases. These are provided in Attachments 2 and 3. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. Copy of First Reading Agenda Item Summary - October 18, 2011 (w/o attachments) 2. Water rate increase graphic and explanation 3. Wastewater rate increase graphics and explanation COPY COPY COPY COPY ATTACHMENT 1 DATE: October 4, 2011 STAFF: Brian Janonis Ellen Switzer AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 20 SUBJECT Items Relating to Utility Rates, Fees and Charges for 2012. A. First Reading of Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges. B. First Reading of Ordinance No. 139, 2011, Amending Chapter 26 of the City Code to Revise Water Plant Investment Fees. C. First Reading of Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges. D. First Reading of Ordinance No. 141, 2011, Amending Chapter 26 of the City Code to Revise Sewer Plant Investment Fees. E. First Reading of Ordinance No. 142, 2011, Amending Chapter 26 of the City Code to Revise Electric Rates, Fees and Charges. F. First Reading of Ordinance No. 143, 2011, Amending Chapter 26 of the City Code to Revise Electric Development Fees and Charges. G. First Reading of Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees. EXECUTIVE SUMMARY The following overall monthly rate increases are recommended for 2012. % Increase Water 6.0% Wastewater 8.0% Electric 8.3% The water and wastewater rate increases are across the board to all customer classes. There is no change in the monthly rate for stormwater. City Council has requested additional data and time to study proposed changes to the electric residential energy service rate (hereafter referred to as “RESR”). Staff will return to Council on November 15, 2011, to recommend changes to the RESR. All other electric rates are included in the electric rate increase referenced above. The electric rate increases are proposed to vary by customer class from 3.9% to 15.9%. The proposed changes will impact individual electric customers more or less than the customer class averages. With the water and wastewater rate changes contained in the proposed ordinances, a typical single family customer’s monthly bill will increase $4.44 from $138.66 to $143.10 or 3.2%. If revisions to the RESR are approved by Council at a later date, the typical residential customer will likely see an additional increase in costs. The later change will depend on the rate form option preferred by City Council. Changes to the water and wastewater plant investment fees and electric development fees will also go into effect if the proposed ordinances are approved. A 4.7% increase in water plant investment fees (PIFs) and a 1.2% increase in stormwater PIFs are proposed. A 3% reduction in wastewater PIFs is recommended. On average, electric development fees will increase from 1% - 3.5% for residential and decrease less than 1% for commercial. Several additional Code modifications and clarifications are also contained in the ordinances above. COPY COPY COPY COPY October 18, 2011 -2- ITEM 20 BACKGROUND / DISCUSSION Monthly Utility Rates The recommended 2012 rate increases differ from the rates that were proposed in the original 2011-2012 Budget. The changes are summarized in Attachment 1 and further explained by the staff memos included as Attachments 2 and 3. All proposed rates would be effective for meter readings on or after January 1, 2012. A. Monthly Water Rates (Ordinance No. 138, 2011, Amending Chapter 26 of the City Code to Revise Water Rates and Charges.) Staff proposes a 6% water rate increase. The increase is across the board and applies to all rate classes. With the proposed rate, a typical single family residential customer’s monthly bill will increase 6% as shown in the following table: Single Family Typical Use 2011 Monthly Water Bill Proposed 2012 Monthly Water Bill $ Increase % Increase January 5000 gallons $24.13 $25.58 $1.45 6% July 21,000 gallons $65.11 $69.04 $3.93 6% Monthly Average* $35.87 $38.05 $2.18 6% *Average based on seasonal use of 117,131 gallons per year Although water rates were increased 3% in 2007, 2010 and in 2011, total Water Fund revenues decreased 23% between 2006 and 2010. The reduction in use is thought to be a combination of conservation, weather and economic factors. While water use is down, the vast majority of the costs of operating the water system are fixed and do not vary based on customer use. The proposed 2012 rate increase is required to fund operations, capital improvements and maintain debt service coverage. Staff has increased projections for Water Fund capital projects needs between 2013 and 2020 by $33 million. Most of this increase is for distribution system replacement ($22 million). The distribution system project increase is a result of the preliminary data from the asset management program. The increase is not related to Halligan Reservoir which is to be funded from the Water Rights Reserve. The Water Rights Reserve is funded by developers’ cash-in-lieu-of water rights payments and is restricted to the purchase of water rights and water storage only. See Attachment 2 for additional detailed explanation of the water rate increase. In addition, staff is proposing to eliminate unmetered construction water for customers with planned water services with meters greater than 1-inch. Staff is also recommending a monthly charge for 3/4-inch and 1-inch construction water service. Construction water will remain unmetered for 3/4-inch and 1-inch services but instead of a flat one time fee on the building permit (equivalent to 1.5 times the base charge for the future account), a monthly account will be established and billed a flat charge based on estimated construction use of 7000 gallons per month. Monthly billing will continue until the permanent meter is set. These changes are proposed to eliminate, or at least reduce, the extended over use of the unmetered construction service and will better reflect the cost of the water provided. Construction Water Frequency of Billing 3/4-inch Meter 1-inch Meter Current 2011 One time charge $ 20.40 $ 50.93 Proposed 2012 Monthly charge $ 25.46 $ 48.55 Includes PILOTs COPY COPY COPY COPY October 18, 2011 -3- ITEM 20 B. Monthly Wastewater Rates (Ordinance No. 140, 2011, Amending Chapter 26 of the City Code to Revise Wastewater Rates, Fees and Charges.) Staff proposes an 8% wastewater rate increase for 2012. The increase is across the board and applies to all rate classes. With the proposed increase, a typical residential customer’s bill will increase from $28.59 to $30.88 or $2.29 per month. The typical customer is based on 4,800 gallons of winter quarter water use. Council previously approved a series of annual wastewater rate increases starting in 2008. The prior rate increases, as well as the proposed 2012 increase, are necessary to fund wastewater operations and meet the increase in long term debt service obligations for the now completed capital project which replaced the trickling filter, made odor control improvements and prepared for future regulatory requirements at the Mulberry Water Reclamation Facility. C. Monthly Electric Rates (Ordinance No. 142, 2011, Amending Chapter 26 of the City Code to Revise Electric Rates, Fees and Charges.) Based on Council response at the September 13, 2011 Work Session, the electric rate ordinance does not contain any changes to the RESR, the rate applicable to the majority of residential customers. The changes to the RESR will be presented in a separate ordinance on November 15, 2011 and will contain several rate form alternatives. The ordinance for consideration at this meeting pertains only to the Residential Demand, Commercial (General Service, General Service 25, General Service 50), Industrial (General Service 750) and Traffic rates. Fort Collins’ wholesale and retail electric rates are among the lowest in the region and nation. This will continue to be true following the 8.3% electric rate increase proposed for 2012. The 8.3% increase is the system average and will not be equally applied to all customer rate classes. Based on a cost-of-service study, the proposed rates vary by rate class as follows: Proposed Rate Class Increases for 2012 Individual customers will vary from the class average. Summer increases (June, July and August) will be greater than average. RESR – Not included in Ordinance No. 142, 2011 6.0% Residential Demand Rate 15.9% 1. General Service (small commercial less than 25 kW) 3.9% 1. General Service 25 (small commercial between 25-49 kW) 15.5% General Service 50 (medium commercial between 50-749 kW) 8.7% General Service 750 (large com/industrial greater than 749kW) 11.0% Traffic Signals 11.3% Floodlights 0.0% Average System Increase 8.3% 1. New rate classes proposed for 2012 4.8% of the 8.3% system-wide increase is due to a 6.4% increase in Platte River Power Authority’s purchase power rates. In addition, Platte River’s wholesale rate will be seasonal, with higher rates in June, July and August. Platte River’s 2012 purchase power rate increase is due to several key factors: • Reduced surplus sales • Increased operating and maintenance costs • Increased financing and depreciation costs as new projects are placed into service • Reduced interest income – due to low interest rates and lower cash reserves The remaining 3.5% of the 8.3% is required to reduce the use of Light and Power’s reserves to cover the cost of system improvements and replacements. While the reduction of reserves has been intentional, expenditures in the Light and Power Fund have exceeded revenues each year since 2007. Even following the proposed 3.5% increase, expenditures are projected to exceed revenues for 2012. COPY COPY COPY COPY October 18, 2011 -4- ITEM 20 The larger commercial classes are experiencing a greater than average increase due to the shift of purchase power costs from demand charges to energy charges in Platte River’s new rate form. Those customers with larger load factors, typically larger commercial and industrial customers and also the traffic signal system, will have larger than average increases in the purchase power components of their rates. (Load factor measures the consistency of power use over time.) Although the last cost-of-service study showed that the residential demand (“RD”) rate was 18% under cost-of-service, all rate classes were limited to a 10% increase in 2011. The 2012 increase brings the RD rate class up to full cost-of- service. The rate has traditionally been selected by high-use customers such as those who exclusively heat their homes with electricity. The increase to this rate will make the RESR more economical for many of the existing RD customers in 2012. Staff is also recommending that the RD rate be available only to those customers providing documentation that their home is heated entirely with electric energy. These changes will begin a phase-out of the RD rate. Electric Rate Form Changes Changes in the electric rate forms are necessary to align rates in support of the City’s Energy Policy and Climate Action Plan goals. By adopting rate forms to incentivize customers to conserve and use energy more efficiently and by providing energy conservation assistance and programs to our customers, the City will more likely be able to achieve its policy goals. In addition, successful implementation of these tools will delay or defer the expense of constructing additional generation resources. Rate form changes are also needed to pass through the seasonal cost differentials that will be charged by Platte River Power Authority beginning in 2012. All rates will have higher costs in the summer (June, July and August) than during the remaining nine “non-summer” months. Consistent with Platte River, the recommended rates also shift a greater proportion of the rate from the demand charges to energy charges. Rate form options were presented to the Council Finance Committee on August 15, 2011 and to the full Council at work sessions on September 13, 2011 and October 11, 2011. Based on Council’s responses to the questions posed at the work sessions, there is a delay in the ordinance making changes to the RESR until November 15, 2011. Several options for the RESR ordinance will be presented at that time. The changes recommended for the RD and Commercial/Industrial rates seemed to have wide-spread support at the September 13 Work Session. The following summarizes changes to the electric rate forms that are included in the proposed electric rate ordinance. • Residential Demand: The residential demand rate will be increased to the cost-of-service and energy charges will reflect the seasonal differential. The rate will be available only to customers who heat their residences exclusively with electricity. • Small /Medium Commercial: The General Service rate is currently one rate class serving all commercial customers with average monthly demands of less than 50 kW. Staff is proposing that it be split into two rate classes beginning in 2012. N General Service - energy-only seasonal rate for customers with average monthly demands of less than 25 kW N General Service 25 - energy/demand seasonal rate for customers with average monthly demands of between 25 and 49kW • Large Commercial / Industrial: The recommended rate form changes for the GS50 and GS750 rate classes are due to Platte River’s seasonal wholesale rate. N General Service 50 – add seasonal energy and coincident demand components for customers with average demands of between 50-749 kW N General Service 750 – add seasonal energy and coincident demand components for customers with average demands of 750 kW and greater Additional Amendments to Electric Article and Rates • Wholesale Transactions: Staff is recommending the addition of a Code section and definition to clarify terms of wholesale transactions and to specify that the retail rates, requirements and electric development fees do not apply to wholesale purchases. COPY COPY COPY COPY October 18, 2011 -5- ITEM 20 • Clarification of Net Metering Credit: Staff is recommending that the rate schedule specify that credits for net excess generation due to net metering will be based on the summer season retail energy charge as reflected in the new rate structure. • Clarification of Parallel Generation Credit: Staff is recommending that the rate tariff schedule specify that credits for parallel generation delivered to the utility will be based on Platte River Power Authority’s avoided cost rate. • Clarification of Distribution Facilities Demand: The proposed change more fully defines distribution facilities demand for the large commercial and industrial rate classes and permits the Utilities Executive Director to use an alternative method to recover a customer’s cost-of-service share of distribution demand if the costs associated with serving a customer are not fully recovered by the standard rate. Monthly Rate Increase Summary The following chart summarizes the impact of the proposed rate changes on a typical single family residential customer: Typical Residential Customer – Monthly Utility Bill Current 2011 Estimated 2012 $ Increase % Increase Electric 700 kWh/mo $59.94 $59.94 * * Wastewater 4,800 gal/mo WQA $28.59 $30.88 $2.29 8.0% Stormwater 8,600 sq.ft. lot, light runoff $14.26 $14.26 $0.00 0.0% Water 117,131 gal/yr $35.87 $38.03 $2.15 6.0% Total Estimated Average Monthly Utility Bill $138.66 $143.10 $4.44 3.2% * The 2012 electric RESR will not be considered by Council until a later Council meeting and therefore will not be effective as of January 1, 2012. A change, averaging 6% is expected to be effective February 1, 2012. COPY COPY COPY COPY October 18, 2011 -6- ITEM 20 The following charts compare Fort Collins Utilities’ monthly rates to others along the Front Range. The electric rate shown for Fort Collins for 2012 is the current 2011 rate. A change to the RESR is expected to be effective in February. The average change to the residential energy rate class is projected to be 6%. 2011 Residential Rate Comparison January Water Use - 5,000 Gallons $- $20 $40 $60 $80 $100 $120 $140 $160 Stormwater $7.13 $10.39 $8.89 $7.10 $14.26 $5.63 $14.26 $- $8.16 Wastewater $20.38 $18.11 $15.83 $20.32 $28.59 $20.48 $30.88 $31.27 $16.72 Water $13.96 $13.19 $18.05 $18.85 $24.13 $26.70 $25.58 $25.26 $38.41 Electric $51.65 $55.37 $76.21 $76.21 $59.94 $76.21 $59.94 $77.47 $76.21 Longmont Loveland Denver Boulder Ft. Collins Greeley Ft. Collins '12 Co.Sprs Aurora 2011 Residential Rate Comparison July Water Use 21,000 Gallons $- $50 $100 $150 $200 $250 Stormwater $10.39 $7.13 $14.26 $7.10 $14.26 $8.89 $5.63 $8.16 $- Wastewater $18.11 $20.38 $28.59 $20.32 $30.88 $15.83 $20.48 $16.72 $31.27 Water $40.71 $59.18 $65.11 $60.14 $69.04 $80.71 $80.14 $123.46 $128.10 Electric $55.37 $51.65 $59.94 $85.16 $59.94 $85.16 $85.16 $85.16 $77.47 Loveland Longmont Ft. Collins Boulder Ft. Collins '12 Denver Greeley Aurora Co.Sprs COPY COPY COPY COPY October 18, 2011 -7- ITEM 20 Plant Investment Fees (PIFs) and Electric Development Fees City Code requires staff to present water, wastewater and stormwater plant investment fees to Council for approval no less than every other year. These fees were last changed in 2009 effective on January 1, 2010. Staff is recommending changes to each of the wet utility PIFs. Water and Stormwater PIFs are increasing 4.7% and 1.2% respectively. Wastewater PIFs are recommended to decrease 3%. Electric development fees are also required to be approved by City Council no less than every second year, although historically staff has recommended annual changes. The current electric development fees were approved by Council in 2010 and were effective January 1, 2011. Staff is recommending the following changes to be effective on January 1, 2012. A. Water Plant Investment Fees (Ordinance No. 139, 2011, Amending Chapter 26 of the City Code to Revise Water Plant Investment Fees.) The water plant investment fees were developed to recover the current value of past investment and the current value of future growth-related investment through 2040. This method includes calculating net water system equity, capacity units and determining the net system equity per unit. The Water PIFs are calculated to increase an average of 4.7% for 2012. There are two major factors influencing the increase. First, projected capital improvements related to regulatory requirements have been allocated to the PIF for that portion of the improvements that will serve new growth. Other revisions have been made to the long range capital improvement plan which also impacted the Water PIF calculations. Together, these capital changes have increased the PIF requirement. The second factor offsets the increase. In 2009, detailed information was not available to classify the construction work in progress. The decision was made to treat it all as backbone related capital additions. This overstated the 2010 PIF requirement. Since that time, additional reporting is available to clearly classify the work in progress. This resulted in a reduction in equity of the backbone system. Water PIF charges for a typical single family lot (8600 sq ft) would increase from $3,826 to $4,084 or $258. The following table shows the proposed increases for water PIFs. Water Plant Investment Fees 2011 2012 Existing Proposed % Change Single Family Residential: Domestic Interior Use - Flat Charge $ 730 $ 730 0.0% Exterior Use - $/Sq ft $ 0.36 $ 0.39 8.3% Duplex and Multi Family: Domestic Interior Use - Charge per Unit $ 490 $ 510 4.1% Exterior Use - $/Sq ft $ 0.27 $ 0.27 0.0% Non-Residential by Meter Size 3/4" $ 7,530 $ 7,880 4.6% 1" $ 21,730 $ 22,750 4.7% 1-1/2" $ 45,300 $ 47,410 4.7% 2" $ 69,070 $ 72,290 4.7% 3" $ 157,920 $ 165,290 4.7% 4" and above assessed on individual basis COPY COPY COPY COPY October 18, 2011 -8- ITEM 20 B. Wastewater/Sewer Plant Investment Fees (Ordinance No. 141, 2011, Amending Chapter 26 of the City Code to Revise Sewer Plant Investment Fees.) The wastewater plant investment fees were developed to recover the current value of past investment and the current value of future growth-related investment through 2040. This method includes calculating net wastewater system equity, capacity units and determining the net system equity per unit. The Wastewater PIFs are calculated to decrease 3% for 2012. Like the Water PIF, this reduction is in part due to a change in the basis for calculating construction work in progress. Other recent revisions to the long range capital improvement plan have reduced the Wastewater PIF calculations. Wastewater PIF charges for a single family lot would decrease from $3,550 to $3,440, a reduction of $110. The following table shows the proposed changes. Wastewater Plant Investment Fees 2011 2012 Existing Proposed % Change Single Family Residential $ 3,550 $ 3,440 -3% Duplex and Multi Family, per unit $ 2,490 $ 2,410 -3% Non-Residential by Water Meter Size 3/4" $ 7,100 $ 6,880 -3% 1" $ 17,880 $ 17,300 -3% 1-1/2" $ 31,490 $ 30,480 -3% 2" $ 55,290 $ 53,520 -3% 3" $ 150,130 $ 145,310 -3% 4" and above assessed on individual basis C. Electric Development Fees (Ordinance No. 143, 2011, Amending Chapter 26 of the City Code to Revise Electric Development Fees and Charges.) Electric development fees recover both actual on-site costs (building site charges) and allocated off-site costs (electric capacity charges) to serve commercial or residential development. These fees are typically adjusted annually to reflect changes in costs. Proposed 2012 fees will increase slightly for some developments (1%-3%) and decrease slightly for others. The table below shows the changes for a typical single family lot and a model commercial development. Typical Single Family Lot 8600 square feet, 70 foot of street frontage, 150 amp service, 4/0 secondary service Current 2011 Proposed 2012 $ Change % Change $3,139 $3,233 $94 3.0% Model Commercial Development 82,000 sq ft, 1900 ft street frontage, 250 ft primary srv, 600 amps, 208Volt, 3-phase, 1-transformer Current 2011 Proposed 2012 $ Change % Change $31,076 $30,981 -$95 -0.3% D. Stormwater Plant Investment Fees (Ordinance No. 144, 2011, Amending Chapter 26 of the City Code to Revise Stormwater Plant Investment Fees) The Stormwater PIFs are recommended to increase 1.2% in 2012. The increase represents a $7.3 million increase in capital facilities added since the last study. However, annexation has caused an increase in total developed and developable acres which results in an increased divisor in the calculation. The two changes result in a modest increase of 1.2%. The PIF will increase from $6,313 per acre to $6,390 per acre. Stormwater PIF charges for a typical single family lot would increase from $1,069 to $1,082, an increase of $13. COPY COPY COPY COPY October 18, 2011 -9- ITEM 20 PIF Change Summary The following chart summarizes the impact of the proposed PIF and development fee changes on a typical residential lot: PIF Changes for Typical Single Family Current 2011 Proposed 2012 Change % Change $ Water1 Raw Water2 Wastewater Stormwater3 Electric1 Total $3,826 $5,203 $3,550 $1,069 $3,139 787 $4,084 $5,203 $3,440 $1,082 $3,233 $17,042 6.7% 0.0% -3.1% 1.2% 3.0% 1.5% $258 $0 (-$110) $13 $94 $255 1Typical, based on lot size of 8,600 sq. ft.; 70-foot street frontage 2 No increase for Raw Water 3 8,600 sq. ft. lot plus estimated 6,156 sq. ft common area and right-of-way; .5 run off coefficient Next Steps: November 1, 2011 City Council Meeting • Second Reading of these seven Ordinances November 15, 2011 City Council Meeting • First Reading of Residential Energy Service Rate Ordinance with seasonal and seasonal-tiered options • First Reading of Service Charges Ordinance with increases for after-hours service charges and a monthly fee for manual meter reading for customers who opt out of the Advanced Meter Fort Collins project. December 6, 2011 City Council Agenda • Second Reading of Residential Energy Service Rate Ordinance COPY COPY COPY COPY October 18, 2011 -10- ITEM 20 the total increase. That amount will depend on the rate form option selected by Council at the November 15, 2011 Council meeting. Utility programs can help customers to reduce their water and electric use and to lessen the financial impact of the rate increases. ENVIRONMENTAL IMPACTS Funding from the proposed electric rate increase will allow the Utilities to continue programs and services aimed at meeting the goals and objectives of the Energy Policy and Climate Action Plan. Accurate seasonal price signals may delay/ avoid the need for additional peak electric generation. Water and wastewater rates provide funding for conservation programs and environmental regulatory compliance. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. BOARD / COMMISSION RECOMMENDATION At its September 15, 2011 meeting the Water Board recommended approval of the proposed 2012 water and wastewater monthly rates and the plant investment fees for 2012. At its October 6, 2011 meeting, the Electric Board voted to recommend approval of the proposed 2012 electric rates (exclusive of the Residential Energy Services Rate) and the proposed 2012 electric development fees. PUBLIC OUTREACH Notice of the proposed electric rate changes was published in the Coloradoan on October 2, 2011 and a mailing was sent to City electric customers outside of the city limits in accordance with PUC requirements. Electric rate forms were discussed at the Council Finance Committee on August 15, 2011 and at a Council Work Session on September 13. A written review of all the rates was included in the October 10, 2011, Council Finance Committee Agenda; however, discussion of the item was postponed until October 17, 2011. Staff plans to conduct outreach to all customers following adoption of the Ordinances. ATTACHMENTS 1. 2012 Utility Rate Increases – Explanation of Change 2. Staff memo to Council related to water rate increase, September 19, 2011 3. Staff memo to Council related to electric rate increase, September 19, 2011 4. Staff memo to Council related to plant investment fees, September 19, 2011 5. Council Work Session Summary September 13, 2011 6. Council Finance Committee, August 15, 2011 7. Water Board minutes, September 15, 2011 8. Electric Board minutes, October 6, 2011 9. Power Point Presentation ATTACHMENT 2 Water Rate Increase All of the 6% water rate increase is expected to be utilized to fund capital improvements. The Fort Collins Utilities implemented an asset management program in 2009, and as a result, the Water Fund transmission and distribution capital program has been revised to include an estimated increase of $22 million of improvements starting in 2013 through 2020. There have also been revised capital improvement increases for the water meter replacement program and the Water Treatment Facility replacement projects of $2.4 million and $3 million, respectively. Water Fund - Total Expenses $0 $10 $20 $30 $40 $50 $60 2007 2008 2009 2010 2011 2012 2013 2014 Actual Actual Actual Actual Revised Budget Projected Projected Millions O & M Exp Debt Capital Total Revenue Capital additions have been funded on a pay-as-you-go basis since 2007 and have remained at $4 million with an increase to $6 million in 2010. With the implementation of the asset management program, capital improvements are expected to increase from 2013 through 2020. Rate increases are needed to fund infrastructure replacement and prevent negative capital reserves. The photos on the following page are examples for need for these capital improvements: An example of an electrolysis hole (top) due to corrosive soils and a longitudinal split (bottom) in cast iron pipe manufactured and installed prior to approximately 1970. An example of sedimentation in pipes manufactured without a cement mortar lining and installed prior to approximately 1950. ATTACHMENT 3 WASTEWATER RATE INCREASE Wastewater Fund - Total Expenses without 2012 Rate Increase $0 $10 $20 $30 $40 $50 $60 2007 2008 2009 2010 2011 2012 2013 2014 Actual Actual Actual Actual Revised Budget Projected Projected Millions O & M Exp Debt Capital Total Revenue $30 M Bonds Wastewater Fund - Total Expenses with 2012 8% Rate Increase $0 $10 $20 $30 $40 $50 $60 2007 2008 2009 2010 2011 2012 2013 2014 Actual Actual Actual Actual Revised Budget Projected Projected Millions O & M Exp Debt Capital Total Revenue $30 M Bonds The Wastewater Fund needs the 8% rate increase in 2012 in order to cover operating and debt service expenses and maintain required bond coverage ratios. Without the 2012 rate increase the bond coverage ratio will decrease to 1.39 in 2013. The required coverage ratio is 1.15, but the Fort Collins Utilities has historically maintained it at above 2.0, achieving better bond ratings. ORDINANCE NO. 138, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE WATER RATES AND CHARGES WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to from time to time fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the water utility, as set forth therein; and WHEREAS, Section 26-118 of the City Code requires that the City Manager analyze the operating and financial records of the water utility during each calendar year and recommend to the City Council the user rate fees to be in effect for the following year; and WHEREAS, the Water Board considered the proposed water rates, fees and charges for 2012 at its September 15, 2011 meeting and recommended approval of the proposed rate changes by a unanimous vote; and WHEREAS, the City Manager has recommended to the City Council that the following water use rates be imposed for the billing year beginning January 1, 2012. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That Section 26-126 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-126. Schedule A, flat rates for unmetered construction water use. For residential and nonresidential premises under construction with a planned meter size greater than 1”, no flat unmetered water service will be provided. For residential and nonresidential premises under construction with a planned meter size of 1-inch or less, the following flat rates will apply per month until the permanent meter is set: ¾-inch construction service, flat charge per month $24.02 1-inch construction service, flat charge per month $45.80 Section 2. That Section 26-127 (a) and (b) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-127. Schedule B, meter rates. (a) Residential Rates. (1) Residential customers with one (1) dwelling unit. a. Base Charge. Residential customers with one (1) dwelling unit shall pay a base monthly charge of thirteen dollars and sixty cents ($13.60). b. Quantity Charge. Residential customers with one (1) dwelling unit shall pay a monthly quantity charge as follows: For the first seven thousand (7,000) gallons used per month, a charge of two dollars and ten and five-tenths cents ($2.105) per one thousand (1,000) gallons. For the next six thousand (6,000) gallons used per month, a charge of two dollars and forty-one and nine-tenths cents ($2.419) per one thousand (1,000) gallons. For all additional gallons used per month, a charge of two dollars and seventy-eight and three-tenths cents ($2.783) per one thousand (1,000) gallons. (2) Residential customers with two (2) dwelling units. a. Base Charge. Residential customers with two (2) dwelling units shall pay a base monthly charge of fifteen dollars and ninety-seven cents ($15.97). b. Quantity Charge. Residential customers with two (2) dwelling units shall pay a monthly quantity charge as follows: For the first nine thousand (9,000) gallons used per month, a charge of two dollars and two and eight-tenths cents ($2.028) per one thousand (1,000) gallons. For the next four thousand (4,000) gallons used per month, a charge of two dollars and thirty-three and one-tenth cents ($2.331) per one thousand (1,000) gallons. For all additional gallons used per month, a charge of two dollars and sixty-eight and two-tenths cents ($2.682) per one thousand (1,000) gallons. (3) Residential customers with more than two (2) dwelling units. -2- a. Base Charge. Residential customers with more than two (2) dwelling units shall pay a base monthly charge of thirteen dollars and forty- nine cents ($13.49) for the first dwelling unit and four dollars and forty-nine cents ($4.49) for the second and each additional dwelling unit. b. Quantity Charge. Residential customers with more than two (2) dwelling units shall pay a monthly quantity charge of one dollar and ninety-five and nine-tenths cents ($1.959) per one thousand (1,000) gallons used in the winter season months of November through April. They shall pay a monthly quantity charge of two dollars and forty- four and nine-tenths cents ($2.449) per one thousand (1,000) gallons used in the summer season months of May through October. The meter reading date shall generally determine the seasonal monthly quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer quantity charge. (b) Nonresidential Rates. (1) Base charge. Nonresidential customers shall pay a base monthly charge based on meter size as follows: Meter Size (inches) Monthly Base Charge ¾ $ 12.17 1 33.95 1½ 92.33 2 139.14 3 212.22 4 333.16 6 646.30 8 1,141.75 (2) Quantity charges. Nonresidential customers shall pay a monthly quantity charge of one dollar and sixty-nine and three-tenths cents ($1.693) per one thousand (1,000) gallons used in the winter season months of November through April. They shall pay a monthly quantity charge of two dollars and eleven and six-tenths cents ($2.116) per one thousand (1,000) gallons used in the summer season months of May through October. The meter reading date shall generally determine the seasonal monthly quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer quantity charge. (3) Charges for excess use. Monthly water use in excess of the amounts specified in the following table shall be billed at two dollars and forty-three and three-tenths cents ($2.433) per one thousand (1,000) -3- gallons used in the winter season months of November through April. Monthly water use in excess of the amounts specified below shall be billed at three dollars and four and two-tenths cents ($3.042) per one thousand (1,000) gallons used in the summer season months of May through October. The meter reading date shall generally determine the seasonal billing excess quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer excess quantity charge. Meter Size (inches) Specified Amount (gallons per month) ¾ 100,000 1 300,000 1½ 625,000 2 1,200,000 3 1,400,000 4 2,500,000 . . . Section 3. That the amendments to the Chapter 26 of the City Code contained herein shall go into effect for all bills issued based on meter readings on or after January 1, 2012. Introduced, considered favorably on first reading, and ordered published this 18th day of October, A.D. 2011, and to be presented for final passage on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -4- Passed and adopted on final reading on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -5- ORDINANCE NO. 139, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE WATER PLANT INVESTMENT FEES WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to from time to time fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the water utility, as set forth therein; and WHEREAS, Section 26-120 of the City Code provides that the rates and parameters of the Water Plant Investment Fees be reviewed annually by the City Manager and shall be presented to City Council for approval no less frequently than biennially; and WHEREAS, on November 3, 2009, the City Council adopted Ordinance No. 116, 2009, which established the plant investment fees that are now in effect; and WHEREAS, the City Council has determined that it is appropriate for new development to contribute its proportionate share of providing capital improvements; and WHEREAS, City staff recommends that existing Water Plant Investment Fees be adjusted based on the current replacement cost of the capital facilities that will be needed to serve new development and for future growth related capital expansion; and WHEREAS, the City Manager has recommended to the City Council the adjustments to the Water Plant Investment Fees set forth herein, to be effective January 1, 2012; and WHEREAS, the Water Board considered the proposed Water Plant Investment Fees for 2012 at its September 15, 2011, meeting and recommended the approval of the proposed fees by an unanimous vote; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Section 26- 128 of the City Code to revise Water Plant Investment Fees. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That Section 26-128 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-128. Schedule C, water plant investment fees. The water plant investment fee prescribed in § 26-120 shall be payable by users both inside and outside of the City, as follows: (1) Single-family residential buildings: For the first three-fourths-inch water tap or meter, a fee of seven hundred thirty dollars ($730.) for a single-family residence, plus thirty-nine cents ($0.39) for each square foot of lot area. For a single-family residential lot greater than one-half (½) acre in size, the lot size shall be deemed to be one-half (½) acre for the purpose of this fee calculation. For each additional tap or meters larger than three-fourths (¾) inch, the nonresidential rate shall apply. (2) Residential buildings of two (2) or more dwelling units: For each residential building unit, a fee of five hundred ten dollars ($510.), plus twenty-seven cents ($0.27) for each square foot of lot area. The fee will provide for one (1) tap per residential building and an adequate number of additional taps to serve common irrigable areas, if any. The number and size of taps shall be determined by the Utilities Executive Director based upon the criteria established in the Uniform Plumbing Code as amended pursuant to Chapter 5 of the Code. (3) Mobile home parks: For each mobile home park, a fee of five hundred ten dollars ($510.) for each mobile home space in the park, plus twenty-seven cents ($0.27) for each square foot of lot area. The fee will provide for one (1) tap per mobile home park. The size of the tap shall be determined by the Utilities Executive Director based upon the criteria established in the Uniform Plumbing Code as amended pursuant to Chapter 5 of the Code. (4) Hotels, rooming houses, sororities, fraternities and similar uses: The nonresidential rate shall apply. (5) Nonresidential service: a. Service to all nonresidential taps, including but not limited to taps for commercial and industrial service, shall be charged according to the size of the meter pursuant to the following schedule: Meter Size (inches) Nonresidential Plant Investment Fee ¾ $ 7,880 1 22,750 1½ 47,410 2 72,290 3 165,290 b. The fee for all meters larger than three (3) inches shall be determined by the Executive Director and shall be based on -2- estimated peak day demand but shall not be less than the charge for a three-inch meter. Section 2. That the amendments to Chapter 26 of the City Code contained herein shall go into effect on January 1, 2012. Introduced, considered favorably on first reading, and ordered published this 18th day of October, A.D. 2011, and to be presented for final passage on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- ORDINANCE NO. 140, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE WASTEWATER RATES, FEES AND CHARGES WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the wastewater utility, as set forth therein; and WHEREAS, City Code Section 26-277 requires that the City Manager analyze the operating and financial records of the wastewater utility during each calendar year and recommend to the City Council the user rate fees or adjustments to be in effect for the following year; and WHEREAS, City Code Section 26-277 further requires that the user rates be revised as necessary to assure equity of the rate system established and to assure that sufficient funds are obtained to adequately operate and maintain the wastewater system; and WHEREAS, the Mulberry Wastewater Reclamation Plant has undergone a upgrade of the plant's treatment processes to prepare the plant for future regulation-based improvements and to make odor control improvements; and WHEREAS, such improvements are not related to growth and will require increased user rates to generate sufficient revenues to repay the debt necessary to finance these improvements; and WHEREAS, the Water Board considered the proposed wastewater rates, fees and changes for 2012 at its September 22, 2011, meeting and recommended approval of the changes by unanimous vote; and WHEREAS, the City Manager has recommended to the City Council that the following wastewater rates be imposed for the billing year beginning January 1, 2012. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That Section 26-280 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-280. Service charges established by category. The schedule of rates for each category described in § 26-279 shall be as follows: Category Class of Customer Rate A Single-family residential user (flat rate) $33.74 per month Single-family residential user (metered water use) $15.07 per month plus $2.929 per 1,000 gallons of either winter quarter water use or 3,000 gallons, whichever is greater. For single family customers who have not established a winter quarter water use at the service address, a system average of 4,800 gallons per month shall be billed. B Duplex (two-family) residential users (flat rate) $52.68 per month Duplex (two-family) residential users (metered water use) $19.52 per month plus $2.929 per 1,000 gallons of either winter quarter water use or 4,000 gallons, whichever is greater. For duplex customers who have not established a winter quarter water use at the service address, a system average 7,200 gallons shall be billed. C Multi-family residential user (more than two dwelling units including mobile home parks) and winter quarter based nonresidential user $2.929 per 1,000 gallons of winter quarter water use, plus a base charge of $2.30 per month per dwelling unit served. For multi family customers who have not established a winter quarter water use at the service address, a system average of 3,400 gallons per living unit shall be billed. D Minor nonresidential user $2.929 per 1,000 gallons of water use, measured sewage flow or winter quarter water use, whichever is applicable, plus the following applicable base charge: Size of water meter (inches) ¾ or smaller 1 1½ 2 3 4 6 8 Base Charge $8.46 19.52 39.28 67.21 107.38 169.59 743.42 858.38 -2- E and F Intermediate nonresidential user and Significant industrial user $2.929 per 1,000 gallons of water use, measured wastewater flow or winter quarter water use, whichever is applicable; plus a surcharge of $3.029 per million gallons for each milligram per liter of suspended solids in excess of 235 milligrams per liter; plus a surcharge of $2.523 per million gallons for each milligram per liter of BOD in excess of 265 milligrams per liter or a surcharge of $1.593 per million gallons for each milligram per liter of COD in excess of 400 milligrams per liter, or a surcharge of $4.716 per million gallons for each milligram per liter of TOC in excess of 130 milligrams per liter, whichever is applicable. The user shall pay this calculated amount plus the applicable base charge set forth below: Size of water meter (inches) ¾ or smaller 1 1½ 2 3 4 6 8 Base charge $8.46 19.52 39.28 67.21 107.38 169.59 743.42 858.38 G User outside City limits The rate for users outside the City limits shall be the same as for like service inside the City limits as is specified in Categories A—F and H in this Section H Special with agreement The rate pursuant to a special wastewater services agreement approved by the City Council pursuant to § 26-290 shall be set forth in said agreement. Section 2 That Section 26-281(c) of the Code of the City of Fort Collins is hereby amended to read as follows: (c) The amount of the wastewater strength surcharge to be billed each user shall be calculated from one (1) of the following three (3) formulas, depending on whether the wastewater is more amenable to testing for BOD, COD or TOC or on the selection of the Executive Director in the absence of monitoring: -3- (1) Cs=Vu[Bc(B) + Sc(S)] (2) Cs=Vu[CODc(COD) + Sc(S)] (3) Cs=Vu[TOCc(TOC) + Sc(S)] Where: Cs = User's surcharge for wastewaters of excessive strength per billing period Vu = Volume of water used or wastewater discharged per billing period Bc = Cost of service for treatment of a unit of BOD B = Concentration of BOD from a user in excess of two hundred sixty- five (265) mg/l Sc = Cost of service for treatment of a unit of TSS S = Concentration of TSS from a user in excess of two hundred thirty- five (235) mg/l CODc = Cost of service for treatment of a unit of COD COD = Concentration of COD from a user in excess of four hundred (400) mg/l TOCc = Cost of service for treatment of a unit of TOC TOC = Concentration of TOC from a user in excess of one hundred thirty (130) mg/l Section 3. That Section 26-282(a) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-282. Wastewater strength or industrial surcharges and categories established. (a) The schedule of wastewater strength surcharge for customers located either inside or outside the City limits shall be as follows: Parameter Excess over (mg/l) Rate per 1,000 gallons BOD 265 $0.002523 COD 400 0.001593 TOC 130 0.004716 TSS 235 0.003029 Section 4. That Section 26-289 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-289. Miscellaneous fees and charges. The following is a schedule of miscellaneous fees and charges: -4- Description Amount (1) Connection fees and service charges Fees shall be set forth as in § 26-712(b) (2) Industrial discharge permits: a. Administration $76.00 annually b. Surveillance Determined for each user annually, based on direct cost plus 15% indirect costs, billed monthly (3) Laboratory support services Determined on a case-by- case basis based on direct cost plus 15% indirect costs (4) Determined on a case-by-case basis based on direct cost plus 15% indirect costs Cost plus 15% (5) Charges for disposal at the Fort Collins Regional Sanitary Waste Transfer Station: a. Septic tanks, vaults, privies, portable toilets: Generated within Larimer County $0.071 per gallon Generated outside Larimer County b. Recreational vehicle sanitary waste holding tanks: $0.108 per gallon Residential customers of the City of Fort Collins Wastewater Utility No charge for individual disposal at Transfer Station Others $2.35 base fee plus $0.071 per gallon (6) Miscellaneous fees Determined on a case-by- case basis based on direct costs plus 15% indirect costs Section 5. That the amendments to the Chapter 26 of the City Code contained herein shall go into effect for billings based upon meter readings on or after in January 1, 2012. -5- Introduced, considered favorably on first reading, and ordered published this 18th day of October, A.D. 2011, and to be presented for final passage on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -6- ORDINANCE NO. 141, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE SEWER PLANT INVESTMENT FEES WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the wastewater utility, as set forth therein; and WHEREAS, Section 26-277 of the City Code requires that the City Manager analyze the operating and financial records of the wastewater utility during each calendar year and recommend to the City Council the user rate fees or adjustments to be in effect for the following year; and WHEREAS, Section 26-283 of the City Code provides that the City Manager review the rates and parameters of the Sewer Plant Investment Fees annually and present them to City Council for approval no less frequently than biennially; and WHEREAS, on November 3, 2009, the City Council adopted Ordinance No. 117, 2009, which established the Sewer Plant Investment fees now in effect; and WHEREAS, it is the City Council’s intent that existing Sewer Plant Investment Fees be adjusted based on the current replacement cost of the capital facilities that will be needed to serve new development and for future growth related capital expansion; and WHEREAS, the City Manager has recommended to the City Council the adjustments to the Sewer Plant Investment Fees set forth herein, to be effective January 1, 2012; and WHEREAS, the Water Board considered the proposed Wastewater Plant Investment Fees for 2012 at its September 15, 2011, meeting and recommended the approval of the proposed fees by an unanimous vote; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Chapter 26 of the City Code to revise Sewer Plant Investment Fees. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That Section 26-284(a) and (d) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-284. Sewer plant investment fees and surcharges established. (a) The schedule of sewer plant investment fees, subject to the exceptions and additional requirements provided in this Section, is as follows: Category SPIF A $ 3,440. B and C $2,410. for each dwelling unit or mobile home space Category Water meter size (inches) Fee D, E, F ¾ $6,880 1 17,300 1½ 30,480 2 53,520 3 145,310 4 and above Calculated on an individual basis based on peak wastewater flow (determined in the manner set forth hereinafter) but not less than the charge for a three-inch meter G Same as equivalent category, plus any special sanitation district fees. H Determined pursuant to paragraph (d) of this Section. . . . (d) The amount of the plant investment fee and surcharge for each nonresidential surcharged user, users in Category H and any user that is expected to generate greater than its proportionate share of peak day flow at the treatment plant for the applicable category (including both contributed wastewater volume and volume related to infiltration and inflow), shall be calculated utilizing the following formula: SPIF = Site Flow x [Flow$ + (BOD x BOD$) + (TSS x TSS$)] + I&I Flow x [Flow$ + (200 mg/l x BOD$) + (250 mg/l x TSS$)] Where: SPIF = Plant investment fee for Category H users and users discharging wastewater with average concentrations of BOD and/or TSS which exceed those average concentrations which are set forth in § 26-282(b) under Category E-34 Site Flow = The user's proportionate share of peak day flow at the treatment plant based on site flow discharge from user's site -2- I&I Flow = That proportionate share of peak day flow due to infiltration and inflow as allocated to user's site flow discharge Flow$ = $6.10 per gallon (unit cost of facilities attributable to treating wastewater flow) BOD = Average BOD concentration for user category or measured BOD concentration for the user as determined in accordance with Subsection (c) of this Section, but not less than 200 mg/l BOD$ = $0.0134 per mg/l (unit cost of facilities attributable to treating BOD) TSS = Average TSS concentration for user category or measured TSS concentration for the user as determined in accordance with Subsection (c) of this Section, but not less than 250 mg/l TSS$ = $0.0107 per mg/l (unit cost of facilities attributable to treating TSS) . . . Section 2. That the amendments to Chapter 26 of the City Code contained herein shall go into effect on January 1, 2012. Introduced, considered favorably on first reading, and ordered published this 18th day of October, A.D. 2011, and to be presented for final passage on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -3- Passed and adopted on final reading on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk -4- ORDINANCE NO. 144, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE STORMWATER PLANT INVESTMENT FEES WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to by ordinance from time to time fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the storm water utility, as set forth therein; and WHEREAS, Section 26-511(a) of the City Code requires that the City Manager review the rates and parameters of the Stormwater Plant Investment Fees annually and present them to City Council for approval no less frequently than biennially; and WHEREAS, on November 3, 2009, the City Council adopted Ordinance No. 119, 2009, which established the Stormwater Plant Investment Fees now in effect; and WHEREAS, the Council has adopted stormwater basin master plans recommending stormwater facilities that are necessary to provide for the proper drainage and control of flood and surface waters within the City; and WHEREAS, existing stormwater rate payers have paid for the design, right-of-way and construction of stormwater facilities identified in the drainage basin master plans that will benefit and be utilized by new development; and WHEREAS, the City Council has determined that new development should pay its proportionate share of the costs of the stormwater infrastructure as it exists at the time of development; and WHEREAS, the City Manager has recommended to the City Council the revised Stormwater Plant Investment Fees set forth herein, to be effective January 1, 2012; and WHEREAS, the Water Board considered the proposed Stormwater Plant Investment Fees for 2012 at its September 15, 2011, meeting and recommended the approval of the proposed fees by an unanimous vote; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Chapter 26 of the City Code to revise Stormwater Plant Investment Fees. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That Section 26-512(2) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-512. Stormwater plant investment fees established. . . . (2) Plant investment fee base rate. The stormwater plant investment fee base rate is six thousand three hundred ninety dollars ($6,390.) per gross acre of area. . . . Section 2. That the amendment to Chapter 26 of the City Code contained herein shall go into effect January 1, 2012. Introduced, considered favorably on first reading, and ordered published this 18th day of October, A.D. 2011, and to be presented for final passage on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 1st day of November, A.D. 2011. _________________________________ Mayor ATTEST: _____________________________ City Clerk • Second Reading of Service Charges Ordinance January 1, 2012 • Effective date of the seven Ordinances included in this agenda item summary and for changes in service charges. (Monthly rate ordinances are effective for billings with meter readings on or after this date.) February 1, 2012 • Proposed effective date of Residential Energy Service Rate Ordinance. (Effective for billings with meter readings on or after this date.) FINANCIAL / ECONOMIC IMPACTS The rates are projected to increase 2012 annual operating revenues of the Water Fund by 6%, the Wastewater Fund by 8% and the Light and Power Fund by 8.3%. (The short delay in adopting the RESR increase will slightly reduce the increase for Light and Power.) The projected revenue from the rate increases is included in the revised 2012 budget projections. The increases are necessary to fund purchase power, operations and system additions and replacements and to meet debt service requirements. The proposed water and wastewater rate ordinances will increase costs for a typical residential customer by $4.47 per month if such customer’s water use remains unchanged. An additional change to the RESR at a later date will change