AGENDA ITEM NO. 5
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AGENDA STAFF REPORT
City of West Covina | Office of the City Manager
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| DATE: | July 7, 2026 |
TO: |
Mayor and City Council |
FROM: |
Milan Mrakich, City Manager |
SUBJECT: |
CONSIDERATION OF RESOLUTION DECLARING INTENT TO COLLECT CITYWIDE SEWER SERVICE CHARGE ON COUNTY TAX ROLL FOR FISCAL YEAR 2026-27 |
RECOMMENDATION:
It is recommended that the City Council adopt the following resolution:
RESOLUTION NO. 2026-66 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA, CALIFORNIA, DECLARING ITS INTENTION TO COLLECT THE CITYWIDE SEWER SERVICE CHARGE ON THE COUNTY TAX ROLL FOR FISCAL YEAR 2026-27 AND SETTING A PUBLIC HEARING REGARDING THE METHOD OF COLLECTION FOR JULY 21, 2026
BACKGROUND:
From 1968 to 1978, the City of West Covina funded the costs of sewer maintenance and operation through the Improvement Act of 1911 ("1911 Act"), which provided an ad valorem (according to value) levy used to pay for these costs. With the passage of Proposition 13, the revenues generated from the 1911 Act were reduced considerably and made it necessary to find an alternative method of funding sewer maintenance and operation costs. In Fiscal Year 1978-79, the City Council established the Citywide Sewer Service Charge pursuant to Section 38902 of the Government Code as the alternative method.
The Sewer Service Charge funds the maintenance and operation of the City’s sewer system, assuring that lines are clear and flowing properly. This includes routine video inspections, jetting, and cleaning of sewer lines. The fees also fund capital improvements, including rehabilitation/replacement of sewer mainlines and appurtenances and purchase of sewer maintenance equipment.
The Sewer Service Charge is based on general land use categories: residential and non-residential. A fixed fee is charged for each dwelling unit for residential property and every 667 square feet of floor area for other types of non-residential developments. Additionally, properties not connected to the sewer main lines are exempt from the charge.
The Sewer Service Charge funds the maintenance and operation of the City’s sewer system, assuring that lines are clear and flowing properly. This includes routine video inspections, jetting, and cleaning of sewer lines. The fees also fund capital improvements, including rehabilitation/replacement of sewer mainlines and appurtenances and purchase of sewer maintenance equipment.
The Sewer Service Charge is based on general land use categories: residential and non-residential. A fixed fee is charged for each dwelling unit for residential property and every 667 square feet of floor area for other types of non-residential developments. Additionally, properties not connected to the sewer main lines are exempt from the charge.
DISCUSSION:
Since adopting the five year sewer service charge schedule on June 6, 2017, the City Council has maintained the sewer service charge at $82.02 per unit, including FY2024-25 and FY 2025-26. Staff recommends continuing the same rate for the current fiscal year.
State law requires that a specific procedure be followed to collect the Citywide Sewer Service Charge on the annual property tax bill. The initial step is to adopt a resolution setting a date for a public hearing on the proposed rates and method of collection. The process requires that a public notice be published in a locally circulated newspaper announcing the public hearing. Mailing notices to each property owner is only required when the charges are increased above the current sewer service rate.
At the public hearing, the property owners are given an opportunity to voice their concerns about the method of collection. The most efficient and least costly method of collecting the Citywide Sewer Service Charge is to place it on the annual property tax bill. The Citywide Sewer Service Charge will then be collected at the same time and in the same manner as the general property taxes.
The proposed resolution sets the public hearing for July 21, 2026 at 7:00 p.m., or as soon thereafter as the matter may be heard, in the City Council Chambers.
The proposed Sewer Service Charge will remain unchanged from the rate in effect for fiscal years 2018 through 2025. To view the Sewer Assessment Roll and other documents pertaining to the Sewer District, please visit the City's website's Engineering Division page, labeled Landscape Maintenance Districts, or visit the website.
State law requires that a specific procedure be followed to collect the Citywide Sewer Service Charge on the annual property tax bill. The initial step is to adopt a resolution setting a date for a public hearing on the proposed rates and method of collection. The process requires that a public notice be published in a locally circulated newspaper announcing the public hearing. Mailing notices to each property owner is only required when the charges are increased above the current sewer service rate.
At the public hearing, the property owners are given an opportunity to voice their concerns about the method of collection. The most efficient and least costly method of collecting the Citywide Sewer Service Charge is to place it on the annual property tax bill. The Citywide Sewer Service Charge will then be collected at the same time and in the same manner as the general property taxes.
The proposed resolution sets the public hearing for July 21, 2026 at 7:00 p.m., or as soon thereafter as the matter may be heard, in the City Council Chambers.
The proposed Sewer Service Charge will remain unchanged from the rate in effect for fiscal years 2018 through 2025. To view the Sewer Assessment Roll and other documents pertaining to the Sewer District, please visit the City's website's Engineering Division page, labeled Landscape Maintenance Districts, or visit the website.
LEGAL REVIEW:
The City Attorney's Office has reviewed the resolution and approved it as to form.
OPTIONS:
The City Council has the following options:
1. Approve Staff's recommendation; or
2. Provide alternative direction.
1. Approve Staff's recommendation; or
2. Provide alternative direction.
Prepared by:
Sarah Garcia, Administrative Assistant II
Additional Approval:
Neil Mehta, Assistant City Manager
Fiscal Impact
FISCAL IMPACT:
For Fiscal Year 2026-27, the Citywide Sewer Service Charge rates are proposed to remain at $82.02 per unit per year. The projected fund balance for end of Fiscal Year 2025-26 is $18,980,189. The projected revenues for FY 2026-27 inclusive of $3,875,299 in assessments, $339,870 in interest income and $447,600 in ad valorem is $4,662,769. Therefore, total funds available for FY 2026-27 are $21,021,841, there are $2,621,117 adopted budgeted expenditures.
Fiscal Year 2026-27, Sewer Capital Improvement Projects:
The Preliminary Financial Report for Fiscal Year 2026-27 contains the following components:
1. Budget and Revenue Summary
2. Capital Improvement Project Fund
3. Proposed Assessment Rate
4. Revised Projected Reserve (Fiscal Year 2026-27)
5. Preliminary Sewer Charge Roll
There are no legal requirements or formal guidelines for the amount of reserves.
Fiscal Year 2026-27, Sewer Capital Improvement Projects:
The Preliminary Financial Report for Fiscal Year 2026-27 contains the following components:
1. Budget and Revenue Summary
2. Capital Improvement Project Fund
3. Proposed Assessment Rate
4. Revised Projected Reserve (Fiscal Year 2026-27)
5. Preliminary Sewer Charge Roll
There are no legal requirements or formal guidelines for the amount of reserves.
Attachments
- Attachment No. 1 - Resolution No. 2026-66
- Attachment No. 2- Preliminary Financial Report
- Attachment No. 3 - 10-Year Projection
CITY COUNCIL GOALS & OBJECTIVES:
A Well-Planned Community
Enhance City Image and Effectiveness
Enhance City Image and Effectiveness
