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HomeMy WebLinkAboutReso 30-15RESOLUTION NO.30-15 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MORRO BAY, CALIFORNIA ESTABLISHING USER RATES FOR WATER AND SEWER (WASTEWATER) SERVICE THE CITY COUNCIL City of Morro Bay, California WHEREAS, the City of Morro Bay undertook a water and sewer rate study to determine whether the current rate structures adequately provided for the maintenance, operation and replacement/rehabilitation of its water and sewer systems; and WHEREAS, the community of Morro Bay seeks to replace its 62-year-old wastewater treatment plant with a new water reclamation facility and to provide for a properly functioning wastewater collection system, complying with the State Water Resources Control Board requirements and the City of Morro Bay Sewer Collection System Master Plan; and WHEREAS, after review of relevant financial data, it has been determined existing Water and Sewer (Wastewater) System rates and charges presently generate insufficient revenue for prudent operation of the systems for the adequate health, safety, and welfare of the community as well as to meet its contractual financing -related obligations; and WHEREAS, the City is required, by State law and City policy, to collect sufficient revenues to cover the costs of operating the water and sewer systems. Those revenues allow the City to safely and reliably provide water to the residents and businesses of Morro Bay and to convey and treat wastewater, generated by the homes and businesses of the City, to protect human health and ensure the environment is safe from the accidental release of effluent into the natural ecosystem. Costs that must be recovered through rate revenue include utilities, equipment, supplies, as well as salaries and benefits of the City staff and financing required reserves. In addition, revenue generated from those rates is used to pay for capital improvements, such as a new water reclamation facility, sewer lift stations and the rehabilitation and replacement of water pipes, sewer pipes, water meters, fire hydrants and other associated equipment. Revenues are also used to pay off debt incurred in the process of installing or constructing significant capital improvements; and WHEREAS, the proposed rates reflect the cost of providing service to all customers through the apportionment of costs based on customer, capacity, and demand characteristics; and WHEREAS, it has been determined the recommended rates do not exceed the reasonable cost of providing water or sewer services and, as such, the proposed rates are not levied for general revenue purposes; and 01181.0001/253744.1 WHEREAS, in accordance with Government Code section 50076, "As used in this article, "special tax" shall not include any fee which does not exceed the reasonable cost of providing the service or regulatory activity for which the fee is charged and which is not levied for general revenue purposes;" and WHEREAS, a notice of the public hearing regarding the proposed changes to the wastewater rates was mailed to each rate payer not less than forty-five days prior to the public hearing, in compliance with Section 6 of Article XIII-D of the Constitution of the State of California; and WHEREAS, that public hearing was held before the City Council on May 26, 2015; and WHEREAS, at the public hearing on May 26, 2015, eleven (11) persons were present and spoke in opposition to the proposal; and one (1) person was present and spoke in support of the proposal; and WHEREAS, on May 26, 2015, the City Clerk advised the Council that 932 written protests of the proposal were received prior to the hearing; and WHEREAS, on May 26, 2015, the City Council received one (1) written rate increase protest that was submitted at the time of the public hearing; and WHEREAS, at the conclusion of the public hearing, the City Clerk tabulated the number of written protests received and reported there was not a majority protest of the proposed water or sewer rate increase by owners or authorized representatives of identified parcels receiving such services; and WHEREAS, based on the information presented, including the staff reports and comments from the members of the public, the City Council of the City of Morro Bay finds the following: A. The purposes of the updated water rates established pursuant to this Resolution are to: • Recover the reasonable estimate cost of services for which the rates are charged • Provide such costs allocated among City customers so as to bear a fair and reasonable relationship to customers' burdens on and benefit from City water or sewer services • Secure the financial stability of the water and sewer systems • Ensure high quality services • Provide a sound financial plan that meets existing ongoing operations and maintenance and debt service obligations which will assist in funding capital improvement projects. B. The updated water service rates established pursuant to this Resolution are not levied for general revenue purposes. 01181.0001/253744.1 Resolution 30-15: Wastewater Service Rates Page 2 of 4 C. The rates set forth in this Resolution are intended to meet operating expenses, meet financial reserve needs and requirements, secure funding for capital improvement projects necessary to maintain service with existing service areas, and recover costs necessary to maintain the current level of City -water services. As such, adoption of the rates proposed in the staff reports and resolution as they relate to water and sewer services to City customers, is not a "project" within the meaning of the California Environmental Quality Act (CEQA), Public Resources Code subsections 21080 (b) (8) (A) (C) and (D)", which state: meeting operating expenses, including employee wage rates and fringe benefits"; "meeting financial reserve needs and requirements" and "obtaining funds for capital projects necessary to maintain service within existing service areas." WHEREAS, in adopting the rates set forth in this Resolution, the City Council of the City of Morro Bay is exercising its powers under California Constitution Article XI, Section7, which states: "A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws"; and WHEREAS, the procedures followed and the rates adopted are in compliance with California Constitution Article XIII D, "Property -Related Fees and Charges"; and WHEREAS, there is not a protest of the proposed water or sewer service rate increases by a majority of the owners, or authorized representatives, of identified parcels receiving such services; and WHEREAS, rates shall apply to and be paid by the City customers at the times, and in the amounts and otherwise apply and be administered with the rates as prescribed in this Resolution to be effective July 1, 2015 and the July 1 of each fiscal year through and including July 1, 2019, and those rates and schedule are hereby incorporated into this Resolution; and WHEREAS, the rates and all portions of this Resolution are severable and should any of the rates or any portion of this Resolution be proven to be invalid and unenforceable by a body of competent jurisdiction, then the remaining rates and/or Resolution portions shall be and continue in full force and effect except for those rates and/or Resolution that have been judged to be invalid; and WHEREAS, this Resolution will become effective immediately upon adoption. NOW, THEREFORE, the City Council of the City of Morro Bay hereby resolves the following: SECTION 1: FINDINGS. The City Council hereby adopts all the above recitations as findings and conclusions, which are based on substantial evidence presented to the City Council through staff reports, professional studies and oral and written testimony received and considered by the 01181.0001/253744.1 Resolution 30-15: Wastewater Service Rates Page 3 of 4 Im City Council during the process of considering the rates and issues regarding the subject matter of this Resolution (the "Record of Proceedings"). SECTION 2: DETERMINATION. Based upon then findings and conclusions set forth above, the City Council determines: the Record of Proceedings establishes the costs listed Exhibit A, as those incurred by the City in providing water and sewer services to City customers are reasonable estimates of the costs of providing such services, and the revisions recommended in previous and current staff reports for existing water and sewer rates are necessary to recover the reasonable, estimated cost of providing such services for which the rates are charged, to allocate such costs among City customers so that they bear a fair and reasonable relationship to customers and to secure the financial stability of the City of Morro Bay water or sewer systems in accordance with the analysis conducted in current and prior staff reports. There was no majority protest of the proposed water or sewer rate increases. Therefore, the rates as set forth in Exhibit A are approved and adopted and, effective July 1, 2015 and the July 1 of each fiscal year through and including July 1, 2019, those rates shall, as and when applicable, supersede and replace the existing rates established and repealing resolutions in conflict thereto. SECTION 3: COLLECTION. The City Council hereby directs the rates and charges established by this Resolution shall be billed and collected together with charges for other utility services rendered by the City of Morro Bay. SECTION 4: ENFORCEMENT. In the enforcement of the collection of the rates and charges established herein, the City of Morro Bay may use any available remedy at law or in equity; provided, however, that said rates and charges shall not be collected by means of the San Luis Obispo County Assessor's roll of real property taxes, nor shall any delinquent rates or charges be enforced by means of a lien on real property. PASSED AND ADOPTED by the Morro Bay City Council at a regular meeting thereof held on the 26t' day of May, 2015 by the following vote: AYES: Irons, Headding, Johnson, Makowetski, Smukler NOES: None ABSENT: None ABSTAIN: None JAMJh L. IRONS, Mayor ATTEST: DANA SWANSON, City Clerk 01181.0001/253744.1 Resolution 30-15: Wastewater Service Rates Page 4 of 4