8.
City Council Work Session - AMENDED
- Meeting Date:
- 06/27/2017
- From:
- Brad Hill, Utilities Director
- Department:
- Utilities
Co-Submitter:
Sandy Corder, Revenue Director
TITLE:
Reclaimed Water Rate Options for Consideration. (MOVED FROM ITEM 10)
DESIRED OUTCOME:
|
Provide Staff direction on which Option(s) to bring back for Council consideration.
|
EXECUTIVE SUMMARY:
| At the February 28, 2017 City Council meeting, staff was directed to bring to Council several options for consideration to increase reclaimed water rates. Staff is seeking City Council's direction and public comment. The Flagstaff Water Commission met on June 15, 2017. The Commission voted for the following options to be brought forward for City Council to consider: All Reclaimed Customer Classes, Except Off-Peak Increase all Reclaimed Water customer classes to 35% of equivalent potable water customer class. Increase rates in a 3-year phase completed in January 2020. (Option 2 Presented) Vote 7-0 Off-Peak Customer Class (those customers that have on-site storage & can accept reclaimed water on an "as-available basis") Alternative Option: Phase out Tier 2 and increase Tier 1 by 6.2% each year between 2018 and 2020. Vote 4-2 Debt Option Alternative Option: Consider all Capital Improvements proposed by staff that are needed to make the reclaimed system more robust and identify the Debt (Bond) needed and the rates to pay for them.
|
| Impact on Customer Class 2017-2020 |
35% 3 Year Phase In, Analysis Retains 83 Cent Surcharge | ||
Rate Schedule |
2017 Reclaimed | 2020 Reclaimed | Percentage |
| City - RW (I) | $ 1.59 | $ 1.93 | 35% |
| Commercial - RW (I) | $ 1.59 | $ 1.93 | 35% |
| Commercial - RW (O) | $ 1.75 | $ 2.13 | 35% |
| Manufacturing -RW(I) | $ 1.57 | $ 1.91 | 35% |
| NAU - RW (I) | $ 1.48 | $ 1.80 | 35% |
| Residential - RW (I) | $ 2.91 | $ 3.33 | |
| Standpipe - RW | $ 3.55 | $ 4.08 | 51% |
INFORMATION:
Below are the Options that Staff brought forward to the Water Commission at their June 15, 2017 meeting for their consideration:
All Reclaimed Customer Classes, Except Off-Peak
Option 1: Increase all Reclaimed Water customer classes to 35% of equivalent potable water customer class. Increase rates in a single year in January 2018. Rates will then increase 4.4% in January 2019 & 2020 in line with potable water rate increases.
Option 2: Increase all Reclaimed Water customer classes to 35% of equivalent potable water customer class. Increase rates in a 3-year phase completed in January 2020.
Option 3: Increase all Reclaimed Water customer classes to 45% of equivalent potable water customer class. Increase rates in a 3-year phase completed in January 2020.
Off-Peak Customer Class
Option 1: Eliminate Tier 2 in January 2018 and no rate increases to Tier 1
Option 2: Eliminate Tier 2 in January 2018 and increase Tier 1 by 4.4%/year between 2018 and 2020
Option 3: Phase out Tier 2 through January 2020 and no rate increases to Tier 1
Option 4: Phase out Tier 2 and increase Tier 1 by 4.4%/year between 2018 and 2020
All Reclaimed Customer Classes, Except Off-Peak
Option 1: Increase all Reclaimed Water customer classes to 35% of equivalent potable water customer class. Increase rates in a single year in January 2018. Rates will then increase 4.4% in January 2019 & 2020 in line with potable water rate increases.
Option 2: Increase all Reclaimed Water customer classes to 35% of equivalent potable water customer class. Increase rates in a 3-year phase completed in January 2020.
Option 3: Increase all Reclaimed Water customer classes to 45% of equivalent potable water customer class. Increase rates in a 3-year phase completed in January 2020.
Off-Peak Customer Class
Option 1: Eliminate Tier 2 in January 2018 and no rate increases to Tier 1
Option 2: Eliminate Tier 2 in January 2018 and increase Tier 1 by 4.4%/year between 2018 and 2020
Option 3: Phase out Tier 2 through January 2020 and no rate increases to Tier 1
Option 4: Phase out Tier 2 and increase Tier 1 by 4.4%/year between 2018 and 2020