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6.4.B. - Page 1 <br /> RE PO RT <br /> To the Honorable Mayor and City Council <br /> From the Cit Mana er <br /> June 24, 2013 <br /> SUBJECT <br /> Approval of Sewer Service Charges <br /> RECOMMENDATION <br /> Waive Second Reading and Adopt an Ordinance Amending Redwood City Municipal <br /> Code Section 27.100 (Sewer Service Charges). <br /> BACKGROUND <br /> The City's Sewer Fund is an "Enterprise" fund, which by law is self-sustaining. All <br /> expenditures must be directly related to operations, maintenance, repairs, treatment, <br /> and system replacement. The Sewer Fund is entirely separated from the City's General <br /> Fund. <br /> The Sewer Fund supports two major service components: 1) the collection system, <br /> maintained and operated by Redwood City, comprised of sewer main lines in the City <br /> Streets, the public portion of lateral (or service) lines from homes and businesses, and <br /> sewer lift stations that transmit sewage; and 2) the wastewater treatment plant, <br /> operated and maintained by South Bayside System Authority ("SBSA"), which treats <br /> and processes the City's wastewater before discharging it into the San Francisco Bay. <br /> SBSA is a Joint Powers Authority comprised of the cities of Belmont, Redwood City, <br /> San Carlos, and West Bay Sanitary District. <br /> The City Council typically adjusts sewer service charges each fiscal year in <br /> consideration of the operating and capital budgets of the City and SBSA. On March 6, <br /> 2013, the City Council's Utilities Committee ("Utilities Committee") recommended a 9% <br /> increase per fiscal year for the next three fiscal years. The Utilities Committee <br /> considered a two-year cycle, but determined that such direction would once again place <br /> the rate setting in the middle of the City's regular two-year budget cycle. Consequently, <br /> the Utilities Committee recommended that the rate increases be established over a <br /> three-year period to then bring the rate setting into line with the other City budgets. <br /> ANALYSIS <br /> The SBSA's infrastructure replacement and repair projects continue to be the primary <br /> factor for the proposed sewer service charge increases in the Sewer Fund. The SBSA's <br /> total projected replacement and repair costs are slightly more than $400 million (with <br /> cost inflation) over the next 10-year period. Redwood City's estimated share of these <br />