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City Manager Jim Smith suggested three questions for Council to consider: 1) Should taxpayers of Redwood City subsidize users in the unincorporated areas? 2) What is the correct rate to charge for water usage? 3) Would selling the system in Emerald Lake Hills relieve the financial burden to Redwood City residents and to Emerald Lake Hills as well? Council discussed the burden on large water users such as Canada College when multipliers are applied, the average water use of Emerald Lake Hills as compared to citywide usage, lower water usage creating higher multiplier, difference in average water bills per month for Emerald Lake Hills residents after new multiplier applied and sale of system; initial justifications for multipliers and Proposition 13 aftermath; and Emerald Lake Hills residents do not pay property tax to Redwood City. Vice Mayor LaBerge opened the public hearing at 9:00 p.m. The following people spoke in opposition to the higher multiplier for Emerald Lake Hills /Canada College water users proposed in Final Report, Water and Sewer Rate Study: Doug Finlay, 360 Summit Drive, Redwood City, submitted PH8/7/89 -1, Emerald Lake Hills Association Water Rate Multiplier Analysis, representing Emerald Lake Hills Homeowners Association and signers of petitions to be presented to City Clerk on 8/8/89, citing: Emerald Lake Hills water users have been subsidizing Redwood City water users; mathematical errors in the Final Report, Water and Sewer Rate Study; illegal to charge franchise tax to residents outside city limits; overhead costs not allocated according to usage or per unit cost; budget rather than actual data was used in the Final Report; and sale of system would benefit both parties. Tom Nolan, County of San Mateo Supervisor, 312 Grayson Court, Menlo Park, asked Council to view the Redwood City and Emerald Lake Hills water users as being members of one service district and offered the good offices of the Board of Supervisors to work with all parties for a beneficial solution. Laura Dowlinq, 140 Springdale Way, Redwood City read a letter from Carole Henley, 157 Sprindale Way, Redwood City, PH8/7/89 -2 asking Council for an accounting of the improvements and actual costs of the Emerald Lake Hills water system. Elizabeth Alexander, Town of Woodside Councilmember, 935 Canada Road, Woodside, PH8/7/89 -3 letter to Council citing neglect of system. Bob Brown, 515 Sunset Way, Redwood City, described lack of maintenance and deteriorating equipment. Chris Bohl, 3924 Lakemead, Redwood City, PH8/7/89 -4 Redwood City Houses on ELH pumps, citing errors in Final Report, Water and Sewer Study; other houses higher in Redwood City hills than many in Emerald Lake Hills do not pay multiplier and therefore the argument that multiplier is based on actual cost is incorrect; and need to find actual cost. Minutes MINUTE BOOK NO. 49 8/7/89 Page No. 58 Page 3