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HomeMy WebLinkAbout2016-035 Water Connection Charge Fee Adjustment; YMC Amendment 7.56.050, 7.56.055 and 7.56.060AN ORDINANCE ORDINANCE NO. 2016-035 establishing rates, charges, terms and conditions for domestic water system connections and service; amending sections 7.56.050, 7.56.055, and 7.56.060, of Chapter 7.56, Domestic Water System Connection Charge, of the City of Yakima Municipal Code; and providing for an effective date. WHEREAS, RCW 35.92.010 authorizes cities to own and operate water utilities, and to regulate and control the use, distribution, and price for water utility service; and WHEREAS, Article IX, Section 1 of the City Charter of the City of Yakima authorizes the City Council to provide by ordinance rules and regulations for the control, management and operation of all public utilities owned and operated by the City; and WHEREAS, the City Council has established rates and charges for domestic water connection through the enactment of Yakima Municipal Code (YMC) chapters 7.56 and 7.68; and WHEREAS, the consulting firm of Financial Consulting Solutions Group, Inc. has completed a "2012 Connection Charge Study Report" for the City of Yakima; and WHEREAS, the City Council finds and determines that the rates, charges, terms and conditions for domestic water utility service set forth in this ordinance are fair, just and reasonable; and WHEREAS, the City Council finds and determines that adoption of this ordinance is in the public interest; now, therefore, BE IT ORDAINED BY THE CITY OF YAKIMA: Section 1. Section 7.56.050 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.050 Domestic charge. The domestic charge shall include both an equitable share of the cost of the existing facilities related to the supply, treatment, transmission, storage and pumping of domestic water and a reasonable estimate of the actual cost of connection of domestic water demand to the domestic water system (including costs associated with expanding the system). The amount of this charge is a function of the amount of water flowing to the facility to be connected, and shall be determined pursuant either to subsection A or subsection B of this section. A. The domestic charge shall be determined by the size of the water meter to be installed. The domestic charge for a particular facility shall be determined by reference to the following chart: Domestic Meter Size Charge 3/4" $ 683.00 1" 1,139.00 1.5" 2,278.00 2" 3,644.00 3" 7.289.00 4" 11, 388.00 The domestic charge for water meter sizes not listed above shall be established by the division manager based upon the same methodology and data as the charges listed above. B. For any facility to be served by a water meter that is larger than four inches in diameter, the division manager shall calculate a recommended domestic charge pursuant to this subsection. The recommended domestic charge shall be calculated according to the methodology employed to calculate the rates listed in subsection A of this section. The division manager shall forward the recommended domestic charge to the city council. The council shall establish the domestic charge for the facility. Section 2. Section 7.56.055 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.055 Distribution connection charge. The distribution charge shall include an equitable share of the cost of the existing facilities related to the distribution of domestic water. The amount of this charge is the proportionate share of distribution facilities based on an amount equal to the average amount per customer in the existing distribution system established by the existing customer base, and shall be determined pursuant either to subsection A or subsection B of this section. This charge would be imposed on the owner of any lot, tract or facility to be connected to the domestic water distribution system and that has not previously contributed a share of the cost of the distribution system through a local improvement district (LID) assessment, developer contribution or other direct contributions. This charge does not apply to new development where the developer pays for the cost of the distribution system water main extensions and the cost of connecting these extensions to the existing domestic distribution system. A. The distribution charge shall be determined by the size of the water meter to be installed. The distribution charge for a particular facility shall be determined by reference to the following: Distribution Meter Size Charge 3/4" $595.00 1" 992.00 1.5" 1,984.00 2" 3,175.00 3" 6,350.00 4" 9,922.00 The distribution charge for water meter sizes not listed above shall be established by the manager of the water/irrigation division based upon the same methodology and data as the charges listed above. B. For any facility to be served by a water meter that is larger than four inches in diameter, the manager of the water/irrigation division shall calculate a recommended distribution charge pursuant to this subsection. The recommended distribution charge shall be calculate according to the methodology employed to calculate the rates listed in subsection A of this section. The division manager shall forward the recommended distribution charge to the city council. The city council shall establish the distribution charge for the facility. Section 3. Section 7.56.060 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.060 Base irrigation charge. The base irrigation charge includes both an equitable share of the cost of the existing domestic water system and a reasonable estimate of the actual cost of connection of irrigation demand to the domestic water system (including costs associated with expanding the system). This charge is a function of the size of the irrigable portion of the lot to be connected. For single-family dwellings and two-family dwellings, the base irrigation charge shall be determined by multiplying the lot area (measured in square feet (sf)) by a rate of $0.073/sf. For other parcels, the base irrigation charge shall be, at the property owner's option, determined either by multiplying the total lot area by a rate of $0.073/sf. or by multiplying the permeable portion of the lot area by a rate of $0.12/sf. In no event shall the charge be applied to Tess than five percent of the total lot area for purposes of this subsection. Section 4. Severability. If any section, sentence, clause or phrase of this Ordinance should be held to be unconstitutional, unlawful or invalid by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other section, sentence, clause or phrase of this Ordinance. Section 5. Effective Date. This ordinance shall be in full force and effect 30 days after its passage, approval, and publication as provided by law and by the City Charter. PASSED BY THE CITY COUNCIL, signed and approved this 6th day of December, 2016. ATTEST: CUA': Sonya Cla)ar Tee, City Clerk -/ v. ` Publication Date: December 9, 201. 'vr; T ON Effective Date: January 8, 2017 ITEM TITLE: SUBMITTED BY: BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDASTATEMENT Item No. 15. For Meeting of: December 6, 2016 Ordinance amending Chapter 7.56 of the Yakima Municipal Code regarding Water Connection Charge Fee Adjustment Scott Schafer, Director of Public Works David Brown, Water/Irrigation Manager, 575-6204 SUMMARY EXPLANATION: An ordinance to amend Yakima Municipal Code (YMC) 7.56 the connection fee for new connections to the drinking water system. This fee is charged to any new connection to the drinking water system to allocate an equitable share of the cost of the existing domestic water system , and a reasonable estimate of the actual cost of connection (including costs associated with expanding the domestic water system), to persons who connect lots or facilities to the domestic water system. Using the domestic water system for irrigation purposes imposes capacity -related costs on the domestic system in addition to those imposed by using the domestic water system solely for domestic purposes. The connection fee was first established in 1997 and has not been adjusted. This fee is one of several elements that keep the water utility sustainable. The City contracted with FCS Group to conduct a study to update the connection fees. There are three types of connection charges: • Domestic water connection charge – Recovers a proportionate share of the cost of general facilities—those that provide water treatment, transmission, storage, and pumping capacity. Applies to all new connections to the domestic water system. • Distribution plant connection charge – Recovers a proportionate share of the cost of local facilities—distribution lines, hydrants, services, and meters—that have not been already paid for through local improvement districts (LI Ds) or developer extensions. • Base irrigation charge – Recovers a proportionate share of treatment, transmission, storage, and pumping capacity costs as they apply to customers who use domestic water for irrigation purposes. Calculating the first two types of charges requires that water system capacity costs, net of contributed capital, be allocated between general facilities and local facilities. Calculating the base irrigation charge requires that the domestic water connection charge be converted from a "per ERU" basis to a "per square foot" basis. Any connection charge is the unit cost of the City's investment in the fixed plant needed to serve its customers. The numerator is the applicable cost of the system's fixed plant, minus contributed capital, plus accrued interest. The denominator is either the number of units served by that plant (demand) or able to be served by that plant (capacity). In this study we continue the City's past practice of using capacity as the denominator rather than demand. This ordinance increases the domestic and distribution connection fee and decreases the base irrigation fee charged when using the domestic system for irrigation. Below are the compression of fee increases for an average residential and an average commercial connection. They are in two tables, the domestic connection fee is always charged; the distribution connection fee is only charged when connecting to a water main that was installed (new not replaced) at city expense. 3/4 inch Average Residential 1997 Domestic Connection Fee - 2017 Domestic Connection Fee - Increase $474.00 $683.00 $209.00 1997 Distribution Connection Fee - 2017 Distribution Connection Fee - Increase $120.00 $595.00 $475.00 1 1/2 inch Average Commercial 1997 Domestic Connection Fee - 2017 Domestic Connection Fee - Increase $1,580.00 $2,278.00 $698.00 1997 Distribution Connection Fee - 2017 Distribution Connection Fee - Increase $398.00 $1,984.00 $1,586.00 The new fees are estimated to generate about $50,000 in additional dollars annually. All connection fee dollars go to the capital improvement fund. ITEM BUDGETED: Yes STRATEGIC PRIORITY: Public Trust and Accountability APPROVED FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: Pass ordinance BOARD/COMMITTEE RECOMMENDATION: ATTACHMENTS: Description D Ordinance redline D Ordinance clean Upload Date 11/29/2016 11/29/2016 Type Ordinance Ordinance AN ORDINANCE ORDINANCE NO. 2016 - establishing rates, charges, terms and conditions for domestic water system connections and service; amending sections 7.56.050, 7.56.055, and 7.56.060, of Chapter 7.56, Domestic Water System Connection Charge, of the City of Yakima Municipal Code; and providing for an effective date. WHEREAS, RCW 35.92.010 authorizes cities to own and operate water utilities, and to regulate and control the use, distribution, and price for water utility service; and WHEREAS, Article IX, Section 1 of the City Charter of the City of Yakima authorizes the City Council to provide by ordinance rules and regulations for the control, management and operation of all public utilities owned and operated by the City; and WHEREAS, the City Council has established rates and charges for domestic water connection through the enactment of Yakima Municipal Code (YMC) chapters 7.56 and 7.68; and WHEREAS, the consulting firm of Financial Consulting Solutions Group, Inc. has completed a "2012 Connection Charge Study Report" for the City of Yakima; and WHEREAS, the City Council finds and determines that the rates, charges, terms and conditions for domestic water utility service set forth in this ordinance are fair, just and reasonable; and WHEREAS, the City Council finds and determines that adoption of this ordinance is in the public interest; now, therefore, BE IT ORDAINED BY THE CITY OF YAKIMA: Section 1. Section 7.56.050 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.050 Domestic charge. The domestic charge shall include both an equitable share of the cost of the existing facilities related to the supply, treatment, transmission, storage and pumping of domestic water and a reasonable estimate of the actual cost of connection of domestic water demand to the domestic water system (including costs associated with expanding the system). The amount of this charge is a function of the amount of water flowing to the facility to be connected, and shall be determined pursuant either to subsection A or subsection B of this section. A. The domestic charge shall be determined by the size of the water meter to be installed. The domestic charge for a particular facility shall be determined by reference to the following chart: Domestic Meter Size Charge 3/4" $ '17'1683.00 1" 7-901,139.00 1.5" 1,5802 278.00 2" 2,5283 644.00 3" /1,7,107.289.00 4" 7,90011,388.00 The domestic charge for water meter sizes not listed above shall be established by the division manager based upon the same methodology and data as the charges listed above. B. For any facility to be served by a water meter that is larger than four inches in diameter, the division manager shall calculate a recommended domestic charge pursuant to this subsection. The recommended domestic charge shall be calculated according to the methodology employed to calculate the rates listed in subsection A of this section. The division manager shall forward the recommended domestic charge to the city council. The council shall establish the domestic charge for the facility. Section 2. Section 7.56.055 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.055 Distribution connection charge. The distribution charge shall include both an equitable share of the cost of the existing facilities related to the distribution of domestic water. The amount of this charge is the proportionate share of distribution facilities based on an amount equal to the average amount per customer in the existing distribution system established by the existing customer base, and shall be determined pursuant either to subsection A or subsection B of this section. This charge would be imposed on the owner of any lot, tract or facility to be connected to the domestic water distribution system and that has not previously contributed a share of the cost of the distribution system through a local improvement district (LID) assessment, developer contribution or other direct contributions. This charge does not apply to new development where the developer pays for the cost of the distribution system water main extensions and the cost of connecting these extensions to the existing domestic distribution system. A. The distribution charge shall be determined by the size of the water meter to be installed. The distribution charge for a particular facility shall be determined by reference to the following: Distribution Meter Size Charge 3/4" $ 120595.00 1" 4-99992-00 1.5" 49g1 984.00 2" 6383,175.00 3" 1,1956, 350.00 4" 1,9929 992.00 The distribution charge for water meter sizes not listed above shall be established by the manager of the water/irrigation division based upon the same methodology and data as the charges listed above. B. For any facility to be served by a water meter that is larger than four inches in diameter, the manager of the water/irrigation division shall calculate a recommended distribution charge pursuant to this subsection. The recommended distribution charge shall be calculate according to the methodology employed to calculate the rates listed in subsection A of this section. The division manager shall forward the recommended distribution charge to the city council. The city council shall establish the distribution charge for the facility. Section 3. Section 7.56.060 of the City of Yakima Municipal Code is hereby amended to read as follows: 7.56.060 Base irrigation charge. The base irrigation charge includes both an equitable share of the cost of the existing domestic water system and a reasonable estimate of the actual cost of connection of irrigation demand to the domestic water system (including costs associated with expanding the system). This charge is a function of the size of the irrigable portion of the lot to be connected. For single-family dwellings and two-family dwellings, the base irrigation charge shall be determined by multiplying the lot area (measured in square feet (sf)) by a rate of $0. /of. For other parcels, the base irrigation charge shall be, at the property owner's option, determined either by multiplying the total lot area by a rate of $0.of. or by multiplying the permeable portion of the lot area by a rate of $0.4-512/sf. In no event shall the charge be applied to less than five percent of the total lot area for purposes of this subsection. Section 4. Severability. If any section, sentence, clause or phrase of this Ordinance should be held to be unoonodtudona|, unlawful or invalid by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other section, sentence, clause or phrase of this Ordinance. Section 5. Effective Date. This ordinance shall be in full force and effect 30 days after its passage, approval, and publication as provided by law and by the City Charter. PASSED BY THE CITY COUNCIL, signed and apthis ___day of- , 2016. f -.2O10. ATTEST: KathyEffective Date: Coffey,Mayor Sonya Claar Tee, City Clerk Publication Date: