pages: CityCouncil/2015-02-17.pdf, 13
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CityCouncil | 2015-02-17 | 13 | The Public Works Coordinator stated the 2010 rate study is based on projected scenarios of the workload under the regulatory requirements; the highest scenario projected replacing two miles of pipeline per year; the consent decree requires an additional one mile per year; the 2012 sewer bond provided a lump sum of money to pump station renovation and softens the 3% rate increase. Mayor Spencer inquired what the rate increase was for Fiscal Year (FY) 2011-2013. The Public Works Coordinator responded the rate increase was 14% per year for three years and Consumer Price Index (CPI) for the last two. In response to Mayor Spencer's inquiry, Ms. Lechowicz stated the CPI was 2.4% in 2014 and 2.7% in 2015. Mayor Spencer stated in FY 2011 through 2013, there was a 14% increase per year; this increase is a little higher than the last two years, but significantly less than the prior three years; page 9 of the staff report indicates there will be a debt service reduction; two State Revolving Fund (SRF) loans will be paid off in FY 2018; inquired whether a 3% increase will still be needed at that point. The Public Works Coordinator responded in the affirmative; stated the 2012 sewer bond will be exhausted by then. Mayor Spencer inquired whether the $15 million reserve will remain for future years or will it continue to be drawn down. The Public Works Coordinator responded the reserve will remain at $15 million. Mayor Spencer inquired whether 3% would be sufficient to maintain the $15 million, to which the Public Works Coordinator responded in the affirmative; stated Council is approving a five-year period tonight. Mayor Spencer inquired how many years would it take to draw down the $15 million, to which Ms. Lechowicz responded five years. Mayor Spencer inquired whether there is a projection beyond five years. The Public Works Coordinator responded staff has to come back in 2019 for the very same process. Mayor Spencer stated the study shows a significant reduction, not a moderate one; inquired whether the fee would be increased above 3% after year five to avoid drawing down on the $15 million. Ms. Lechowicz responded the appendix of the report shows the 20-year period; inflationary increases are shown each year; the fund balance would continue to be at Regular Meeting Alameda City Council 13 February 17, 2015 | CityCouncil/2015-02-17.pdf |