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BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. 2.
For Meeting of: November 28, 2016
ITEM TITLE: 2017 Preliminary Budget Wrap Up
SUBMITTED BY: Cliff Moore, City Manager
Cindy Epperson, Director of Finance & Budget
SUMMARY EXPLANATION:
The 2017 Preliminary Budget was originally presented to City Council at a study session on
October 24. All of the Departments presented their budget summaries at study sessions held
during the first two weeks of November. Staff had identified budget reduction options totaling
$936,217 which would be removed from the final budget, unless Council chose to keep them in
the budget. Council voted to exclude $248,626 from being reduced, primarily in the areas of
Parks & Recreation and Streets &Traffic Engineering, leaving reductions of $687,591. When
added to a correction of revenue for the final billing to Yakima County for Purchasing services of
$8,333, and the effect of the increased minimum wage initiative of about$68,000, the ending
fund balance is increased by$627,924 to $6,849,465. At this level, the 2017 budget would still
be using about$93,500 of its beginning reserve balance before any other Council changes.
Staff is seeking Council direction on the unbudgeted proposals for expenditures and revenues.
We have an interactive Excel spreadsheet which is pre-loaded with the unbudgeted proposals.
Any approved changes will show the impact on the reserve balance.
Once we have Council direction, a new budget summary will be brought back to Council at the
December 6 meeting, which will be the basis for the final budget hearing. In addition, any related
legislation will be prepared for Council action at the December 6 meeting. Should there be any
additional changes arising at the December 6 Council meeting, we will be able to incorporate
those into final budget adoption scheduled for the last scheduled meeting of the year--
December 13.
ITEM BUDGETED: NA
STRATEGIC PRIORITY: Public Trust and Accountability
APPROVED FOR City Manager
SUBMITTAL: /‘
STAFF RECOMMENDATION:
BOARD/COMMITTEE RECOMMENDATION:
ATTACHMENTS:
Description Upload Date Type
2017 Preliminary Budget Wrap Up 11/22/2016 Presentation
PRELIMINARY BUDGET INFORMATION
GENERAL GOVERNMENT USAGE AND BALANCE COMPARISONS
2016 2017 Variance
2015 Year-End Proposed YE Est vs
Actual Estimate Expenditure Proposed %
Beginning Reserve Balance $ 9,412,400 $ 7,152,826 $ 6,942,980
Revenue 70,265,428 73,651,685 75,578,814 $1,927,129 2.6%
Total Resources $79,677,827 $80,804,511 $82,521,794
Expenditure Budget 72,525,002 73,861,531 76,300,253 2,438,723 3.3%
End. Reserve Balance $ 7,152,826 $ 6,942,980 $ 6,221,541
of Annual Expenditures 9.9% 9.4% 8.2%
Inc/(Dec) in Reserves f/Prior Year $ (2,259,574) $ (209,846) $ (721,439)
of Expenditure Budget (3.1%) (0.3%) (0.9%)
GENERAL GOVERNMENT FUND BALANCE
➢ 2017 Maintenance budget drops Fund Balance by$721,000 from$6.9 million to$6.2 million
-8.2% of budget expenditures
➢ Fund Balance target is 16.7% of budgeted expenditures or$12.7 million-Preliminary
Budget is about half of target
➢ Fund Balance is important for emergencies, cash flow, revenue short falls, one-time
opportunities,matching grants, and to preserve bond rating
➢ Fund Balance can be restored by:
• Expenditure reductions
• Revenue increases
• Or a combination of these two
➢ General Government budget reduction options of$936,000 identified (not budgeted)
➢ New revenues being considered:
• Lift lid on electric,natural gas, and telephone utility tax
• Impose Brokered Natural Gas Utility Tax
• Establish a Transportation Benefit District
• Proposed increase in utility rates
11/28/16 Council Presentation • Introduction-1
GENERAL GOVERNMENT BUDGET OVERVIEW
➢ Major Budget Balancing Strategy
• 1.2%Vacancy rate $675,000
• Eliminated 5 positions (4 Full Time Employee [FTE] funded 480,000
by General Government [GG])
• Reduced Temporary Salary 66,000
➢ Revenue Assumptions
• Proposed 1%inflation adjustment in property taxes plus an $416,000
Estimate of 1.3%new construction
• 3.8% growth in sales tax 640,000
(2012-2014 growth above 6.0%-2015 2.9%,2016 est. 4.0%)
• Revenue growth for Utility Tax of 3.3% 456,000
• Sale of two Tiger Mart locations 400,000
• Imposition of Fire Inspection Fee, Increase Planning Fees 300,000
• Other charges for service (City Service, Utility Billing) 439,000
➢ Cost Drivers
• Cost of living payroll increase (avg. 2.5%)-CPI running under 1% $950,000
• Pension rate increase (2.0% 7/1/17) 175,000
• Medical rate increase 15% (about half mid-2016) 930,000
11/28/16 Council Presentation • Introduction-2
2017 GENERAL GOVERNMENT
PRELIMINARY BUDGET ADJUSTMENT WORKSHEET
Amount
Preliminary Budget Ending 2017 Fund Balance $ 6,221,541
Technical corrections* (59,667)
Not induded in Preliminary Budget
Reduction Options accepted 687,591
Revenue Options accepted -
Revenue Options borrowed -
SI Expenditure Options accepted- -
SI Revenue Options accepted+ -
Included in Preliminary Budget
SI Revenues increased(decreased) -
New Projected Ending 2017 Fund Balance $ 6,849,465
*Additional for Minimum Wage($68,000)
*Purchasing revenue correction$8,333
Note: This is an interactive spreadsheet that will be projected on a big screen at the meeting. As
Council makes decisions in all of these areas, the 2017 ending fund balance will be updated
accordingly.
11/28/16 Council Presentation • Introduction-3
GENERAL GOVERNMENT BUDGET REDUCTIONS
Division/ Personnel Changes Reductions
Svc Unit Description Decrease F/V P/O Yes No
General Fund
City Manager Temporary Salaries $ 2,850 - P $ 2,850 $
Office&Operating Supplies 1,000 - 0 1,000
Professional Services 8,000 - 0 8,000
Data Communications 100 - 0 100
Postage 100 - 0 100
Transportation 1,400 - 0 1,400
Dues&Subscriptions (1,000) - 0 (1,000)
City Council Office&Operating Supplies 1,000 - 0 1,000
Small Tools&Minor Equipment 250 - 0 250
Professional Services 35,000 - 0 35,000
Transportation 3,000 - 0 3,000
City Eliminate Overtime 5,500 - P 5,500
Office&Operating Supplies 3,400 - 0 3,400
Info Technology Delay filling Tele Tech Analyst 30,000 V P 30,000
Prof Services-licenses 20,000 - 0 20,000
Human Prof Services-outside training 14,000 - 0 14,000
Legal 2% Temporary Salaries 10,126 - P 10,126
Office&Operating Supplies 3,500 - 0 3,500
Professional Services 1,300 - 0 1,300
Postage 800 - 0 800
Transportation 1,100 - 0 1,100
Miscellaneous Expenses 2,148 - 0 2,148
Dues&Subscriptions 7,500 - 0 7,500
Repairs&Maintenance 2,500 - 0 2,500
Municipal Court Delay hiring Judicial Specialist 35,200 V P 35,200
Finance Reallocate USR salaries 43,800 F P 43,800
Allocate AR time to Utilities 10,900 F P 10,900
Code Admin Delay hiring Code Comp Off 54,600 V P 54,600
Police Defund 2 task force positions 192,300 V P 192,300
Defund 1 Police Officer 96,150 V P 96,150
Lighting savings 15,250 - 0 15,250
Reduce training budget 20,000 - 0 20,000
Cancel Tower office lease 55,593 - 0 55,593
Fire Uniforms 1,750 - 0 1,750
Parks&Rec 2% DA-III Cemetery&PW Admin 32,500 V P 32,500
Reduce playground program 50,000 - 0 50,000
Reduce summer concerts/movies 8,000 - 0 8,000
Reduce ops at Franklin Pool 20,000 - 0 20,000
Streets 2% Oper Supplies-street material 90,000 - 0 90,000
Oper Supplies-sidewalk abatement 2,500 - 0 2,500
Oper Supplies-weed abatement 5,000 - 0 5,000
Oper Supplies-street lighting 7,500 - 0 7,500
Prof Services-street maintenance 3,000 - 0 3,000
Engineering Decreased Contract Specialist 9,900 F P 9,900
Delay hiring Design Engineer 38,700 - 0 38,700
Copier/Plotter (18,000) - 0 (18,000)
CH Facility 1.5%Temp Salaries 8,000 V P 8,000
Personnel Changes Total $936,217 $687,591 $248,626
F/V=Filled/Vacant P/O=Personnel/Other
11/28/16 Council Presentation • Introduction-4
HUMAN RESOURCES
2017 STRATEGIC INITIATIVE
NEOGOV SOFTWARE
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Add 2 modules to NEOGov Software General Fund Implement $10,000
Annual Sub: 29,200
$39,200
PROPOSAL
NEOGov is the market and technology leader in on-demand human resources software servicing
over 15,000 public sector agencies and educational institutions, including the City of Yakima, and
the State of Washington. NEOGov is the only software company solely focused and proactively
working on meeting the unique needs and requirements of public-sector agencies. The City of
Yakima has solely and very successfully utilized NEOGov's Insight E-recruitment software for
processing applications and tracking testing results for over 5 years,when the City moved from a
more manual system. NEOGov has the ability to interface to our other major applications such as
Payroll and Cayenta to assist in further automation;reducing the manual entries efforts and
ensuring timely and accurate information is used. Additionally, this is the first step in ultimately
eliminating our paper personnel files, converting them to electronic, which will significantly aid in
the City meeting the Washington State Public Records Act as well as process public records
requests.
NEOGov has two additional modules the IT Division and HR Department are recommending the
City begin utilizing to reduce our manual procedures and enhance our electronic and automated
capabilities. These modules are NEOGov's Onboard and Perform.
NEOGov Onboard Module
Onboard enables new hires to become more productive from their first day on the job by
streamlining new hire paperwork, processes, and training. Onboard provides a tool for new hires
to sign forms electronically, completing I-9, W-4, and additional new hire requirements online even
prior to their start date. With Onboard, the City can assign forms to specific employees, groups,
and departments. It can also be used to create forms, checklists and reports which increases
accountability, consistency and compliance. Audits across divisions, departments, or the City as a
whole, which are now very labor intensive, would be available quickly with the click of a mouse.
Clear expectations and timelines can be set, including automated reminders to ensure the City is
meeting all mandated requirements for a new hire. In addition, the City would have the capacity to
establish a new hire portal within Onboard allowing for interactive social collaboration, questions
and answers, documents, trainings, and videos. This would enhance the City's ability to
communicate the City's mission and values immediately to all new hires, as well as relevant
training information.
11/28/16 Council Presentation • Unbudgeted Expenditures -1
NEOGov Perform Module
Perform streamlines and automates the probationary and year-end employee appraisals which
would replace the labor intensive,manual systems currently in use by the City of Yakima. This
electronic tool would enhance supervisors' ability to measure competencies and goals,record
growth and development plans, and increase the quality and thoroughness of the performance
reviews by automating the employee evaluation process. Automation would dramatically increase
efficiency, consistency and accountability by generating appropriate timeline reminders, and would
provide hands-on evaluation tools and assistance for supervisors. This upgrade would enable the
City to more actively maximize employee productivity, and to motivate and retain well performing
employees by providing timely and accurate feedback. The module would also allow HR and other
City departments to easily and globally visualize the City's workforce on the automatically
generated organizational chart, which is currently not possible with a manual system. Easy-to-use
features would allow supervisors to regularly record and audit training and performance
information. They will be able to "drag-and drop"employee-information and "point-and-click to
view employee scorecards and assign goals.
IMPACTS
1. Fiscal Impact-Unbudgeted
Annual subscription license $29,200
Implementation, setup and training(one-time) 10,000
Total $39,200
2. Proposed Funding Source-General Fund. Human Resources is included in the City
Service Charge distribution, so approximately 40% of this expense would be funded by
other operating funds.
3. Public Impact-None.
4. Personnel Impact-Operational efficiencies for both Human Resources and all operating
divisions in processing employee data.
5. Required Changes in City Regulations or Policies-None.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-None.
11/28/16 Council Presentation • Unbudgeted Expenditures -2
FINANCE
2017 STRATEGIC INITIATIVE
WORKIVA REPORTING SOFTWARE
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Purchase Workiva Reporting Software General Fund $29,000
PROPOSAL
Workiva has created Wdesk, a cloud-based productivity platform for enterprises to collect, link,
report, and analyze business data. Wdesk word processing, spreadsheet, and presentation
applications are integrated and built upon a data management engine, offering synchronized data,
controlled collaboration,user permissions, and a full audit trail. Numbers, text, charts and graphics
in presentations and reports can be linked inside Wdesk, which becomes a repository for critical
data. Each piece of data has its own history of changes and any user can drill down into that data
for more information. This productivity software will allow reporting with greater frequency as all
reports, data and graphics remain linked, allowing presentations and reports to be easily updated
as needed. The primary use for this software will be to streamline the CAFR reporting process,but
it will also be used for a wide variety of other reports, such as budget documents and quarterly
reports to Council, as well.
IMPACTS
1. Fiscal Impact-No initial set-up cost. Ongoing license fees of approximately$29,000/year.
2. Proposed Funding Source-General Fund. Financial Services is included in the City Service
Charge distribution, so approximately 40% of this expense would be funded by other
operating funds.
3. Public Impact-Improved ability to produce reports on a timely basis.
4. Personnel Impact—Significant efficiencies after initial implementation and training on the
system.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives—Continue old,more cumbersome processes.
11/28/16 Council Presentation • Unbudgeted Expenditures -3
COMMUNITY DEVELOPMENT/PLANNING
2017 STRATEGIC INITIATIVE
PLANNING DIVISION REORGANIZATION
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Planning Division Reorganization General Fund 2017-No cost
(to be timed to have no net effect in 2017) 2018-$23,300
PROPOSAL
In 2012, as a cost saving measure, the role and responsibility of the Planning Division Manager was
incorporated into the Responsibilities of the Director of Community Development. As a result, staff
supervision, policy implementation and daily operations of the Planning Division have become an
accessory role for the Director. This situation saved the City the salary of a Division Manager for
four years,but has not provided consistent management for the Planning Division, due to time
constraints. Even with my best efforts, Planners have been frustrated with the limited access to
management. This is the only Department in the City that uses a shared Director/Division Manager.
With the hiring of a Planning Manager, the Division would also include two Senior Planners (one
for long range and one for current planning), one Assistant Planner, and one Planning Technician.
To compliment this core staff,the Community Development Director and the Community
Development Administrative Assistant also have direct staff support. This reorganization proposal
does not include any additional staff positions. The greatest benefit of the proposal is a more
consistent presence of a Division Manager and the responsiveness as well as availability of
supervision and decision making. This will benefit the public as well as staff.
IMPACTS
1. Fiscal Impact-The reorganization plan would be nearly revenue neutral in 2017 due to a
vacancy with salary savings in the Division and the time required to implement the hiring
processes. In 2018,the cost will be approximately$23,300 more than the 2016 and 2017 budget.
2. Proposed Funding Source-General Fund.
3. Public Impact-A full-time Planning Manager will provide more stability in the division
and be more responsive to community concerns.
4. Personnel Impact-The proposed reorganization would upgrade one position to a Planning
Manager and create two Senior Planners,one each for current planning and one for long range
planning.These are changes in the job specifications,but no additional staff added to the
Division.
5. Required Changes in City Regulations or Policies-None.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-If the Council does not implement the proposed Reorganization, the
staffing will remain in the current configuration
11/28/16 Council Presentation • Unbudgeted Expenditures -4
FIRE
2017 STRATEGIC INITIATIVE
FACILITY REMODEL AND MODERNIZATION
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Facility Remodel and Modernization Fire Capital $700,000
PROPOSAL
Staff is proposing a wide array of projects that are consistent with ongoing efforts to maintain the
City's fire station facilities. In 2014 YFD commissioned a local architectural firm to provide a cost
estimate for remodeling and modernizing the city's 2 circa 1973 fire station facilities (Stations 91 and
95). At the same time, an evaluation was completed on failing concrete and asphalt surfaces at all 5
city-owned fire station facilities. Together, the estimate totaled approximately 10 million dollars-
with nearly 1 million of that estimate representing the concrete and asphalt projects. The city
manager at the time suggested a fire bond as a funding source. Shortly thereafter, the city manager
planned to combine YPD facility needs with the Fire needs and take it to the voters. Unfortunately
emphasis on that plan was overshadowed by issues at city hall.
Since a large scale bond has not been pursued,this Strategic Initiative attempts to address station
facility issues on a smaller scale in order to help prolong the life of our infrastructure until such
time as a larger funding mechanism becomes available. The upgrades proposed with this Strategic
Initiative include:bedroom remodel at Station 95, apparatus bay exhaust system preventative
maintenance/installation/repairs at multiple stations, flooring repair and replacement at multiple
stations, exterior painting and repairs at multiple stations, replacing apparatus bay doors at
multiple stations, and a number of other repair and maintenance items at each station.
IMPACTS
1. Fiscal Impact-$700,000, all unbudgeted.
2. Proposed Funding Source-General Fund/Fire Capital Fund.
3. Public Impact—None.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives-In the absence of a bond as the funding source, this strategic initiative
represents moving forward to address many of YFD's ongoing facility needs.
11/28/16 Council Presentation • Unbudgeted Expenditures -5
FIRE
2017 STRATEGIC INITIATIVE
ADD ONE FIRE MAINTENANCE MECHANIC
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Add One Fire Maintenance Mechanic General Fund $99,000
position—less temporary salary Temp (24,200)
Net $74,800
PROPOSAL
Staff proposes the increase of 1 Maintenance Mechanic,bringing the total to 2. Since 1990, the City's
footprint and population have grown significantly, and annual calls for service have tripled. To
support this growth, the number of firefighters has grown incrementally, as has the number of
complex fire apparatus, support vehicles, and ancillary equipment such as power saws, generators,
compressors,etc. Despite this growth and service demand, the number of Maintenance Mechanic
positions remains at 1, and that position is charged with an insurmountable task. Over the past 4
years,YFD has been authorized 1, temporary part-time 866-hour employee who serves as a
mechanic's helper. Although the temporary position has made a difference, the backlog of work
will continue to grow without some additional monetary commitment.
IMPACTS
1. Fiscal Impact—
New Position $99,000
Elimination of Temporary Salary (24,200)
Net Increase $74,800
2. Proposed Funding Source—General Fund.
3. Public Impact—None.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—The potential exists for the need to
amend the current job class spec/job functions through Civil Service.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-A viable alternative is the major restructuring of the Maintenance
Mechanic's current scope of work to include outsourcing all current functions of the position
with the exception of repair and preventative maintenance of fire apparatus. Such an
alternative would require negotiating with Local 469 and bringing the proposed changes
through the Human Resources and Civil Service processes.
11/28/16 Council Presentation • Unbudgeted Expenditures - 6
FIRE
2017 STRATEGIC INITIATIVE
ADD THREE FIREFIGHTERS
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Add Three Firefighter positions General Fund $279,000
PROPOSAL
Staff proposes increasing the number of personnel (Firefighters) in the Suppression Division by 3,
effectively increasing the total number of personnel in that division to 93. Currently,meeting the
minimum daily staffing requirement requires a heavy reliance upon overtime funding, and over the
past several years, the overtime funding line item has been consistently over budget. Consequently,
daily service levels (number of personnel on shift) are inconsistent, and being dictated by budget
strategies-rather than more appropriately through service demand strategies.
IMPACTS
1. Fiscal Impact—$279,000.
2. Proposed Funding Source-General Fund. In additional, a potential funding source is the
SAFER(Staffing for Adequate Fire& Emergency Response) Grant. The City could apply for
SAFER, and if successful with an award, the grant could fund total salary and benefit costs
for these positions over a 2-year period (3 years for those employees who are military).
3. Public Impact-The ability to staff the 7th fire apparatus provides an enhanced ability for
multiple crews to participate in training exercises without having to vacate response
coverage areas.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives-An alternative to this proposal that accomplishes generally the same
goal entails increasing the overtime budget by a similar amount.
11/28/16 Council Presentation • Unbudgeted Expenditures - 7
AIRPORT
2017 STRATEGIC INITIATIVE
ADD ONE AIRPORT ASSISTANT MANAGER
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Add One Airport Assistant Manager position Airport Operations $102,400
or General Fund
PROPOSAL
One of the primary challenges facing the Yakima Air Terminal (YAT)today is insufficient staffing
levels to maintain the airport on a 24/7 basis. Since 2012, the airport has been operating with a
reduced staff. In 2012,when the Yakima Air Terminal changed from a joint venture with Yakima
County to being owned by the City, the Assistant Airport Manager position was eliminated and the
duties of two Administrative Assistant positions were moved to the City(i.e. Accounts Payable,
Human Resources/Payroll, Accounts Receivable),which reduced the Airport Administration staff
to two full-time positions.
The airport came with issues relating to deferred maintenance and a fund balance below
recommended minimum levels, so the 2012 staffing cuts were necessary to keep the YAT operating
within its revenue base. We have been able to gradually grow revenue,but all of the growth has
been used to replace aging, failing equipment and accomplish some major maintenance. The 2017
budget is virtually break-even, with a projected ending balance of$147,700, which represents 12.9%
of the 2017 expenditure budget, still slightly below the recommended 16.7%level. This budget still
does not have room for another permanent position—any additional staffing would need to be
supported by General Fund, which is why it is unbudgeted.
The Assistant Airport Manager focuses on management of the airport including projects,
marketing,leasing,budget, capital improvement planning, construction management, airfield
operations and maintenance, snow removal operations, airfield condition reporting, Notice to
Airmen dissemination, airport security, and management of personnel.
IMPACTS
1. Fiscal Impact—$102,400.
2. Proposed Funding Source-Airport Operations/General Fund.
3. Public Impact-Additional manager will increase productivity within the airport
administration office to allow the airport manager to focus on airport development, attract
air service, and aircraft manufacturing. Increased staff will also ensure appropriate
coverage is maintained during inclement weather to increase safety measures as passengers
traverse the airport.
11/28/16 Council Presentation • Unbudgeted Expenditures -8
4. Personnel Impact--Increased staffing levels by 1.0 FTE to provide superior internal and
external customer service. The additional position will relieve workload within the
organization to allow staff to focus on airport development.
5. Required Changes in City Regulations or Policies-Civil Service-City master pay ordinance.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Continue to operate at current staffing levels.
11/28/16 Council Presentation • Unbudgeted Expenditures - 9
PUBLIC WORKS/STREETS
2017 STRATEGIC INITIATIVE
ENERGY CONSERVATION STREET LIGHTING
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Energy conservation measure Street Fund $2,100,000
Switch out high pressure sodium street lights DOC Energy
to LED. Funded by: Grant
Energy rebates-$211,000 LOCAL
Department of Commerce grant-$350,000 Borrowing
LOCAL borrowing-$1,539,000
PROPOSAL
The City has the opportunity to upgrade all existing High Pressure Sodium streetlights to high
efficiency LED streetlights which will improve the quality of street lighting throughout the City.
The City of Yakima,through the Washington State Department of Economic Services (DES),
selected AMERESCO as the Energy Service Consultant (ESC) to assist with development and
implementation of the streetlight upgrade project. The use of the ESC provides the city not only
their expertise but guaranteed final project cost,equipment performance, and energy savings.
An energy study conducted by AMERESCO estimated the total cost of the project at$2.1 million
with approximately$570,000 of cost covered by Pacific Power rebates and a Department of
Commerce grant. The estimated reduced energy cost would be enough to pay for the debt service
and have a slight positive annual cash flow. That positive cash flow could be used to cover the cost
of the crime reduction lighting program that has been under consideration by the Public Safety
Committee, depending on how much is available.
If the project is approved to proceed, AMERESCO will conduct an energy audit and assist the City
in selecting the best components for the streetlight upgrades, develop a lighting design for the City,
determine a guaranteed "not too exceed" cost estimate for the project, and assist in developing a
funding strategy for implementation. They will also manage and inspect the installation of the new
lighting fixtures, and monitor on-going system performance to ensure that all the guaranteed
project criteria are met. DES oversees AMERESCO throughout the process to make sure they are
following established practices and the City is receiving honest service from them.
Similar projects around the state have resulted in a notable improvement in the quality/intensity of
street lights which has the potential to reduce crime. After this improvement is in place, street
lighting will be evaluated for "gaps". Any energy savings in excess of required debt service could
be used to install new streetlights in poorly lit areas as a crime deterrent.
11/28/16 Council Presentation • Unbudgeted Expenditures -10
Financing Annual Annual Net
Terms Debt Pmt Savings(1) Savings(2)
Estimated Project Cost $2,051,566
Less:Estimated Utility Incentive(Rebate) 211,445
Net Project Cost to Finance without Grant 1,840,121 13 yr, 1.95% $159,932 $ 166,915 $ 6,983
Less:Dept of Commerce Grant Request 350,000
Net Project Cost to Finance with Grant $1,490,121 12 yr, 1.9% $138,388 $ 166,915 $ 28,527
(1) Annual savings include estimates of the reduction of the energy bill--$156,915 and the reduction in streetlight
maintenance supplies(bulbs,fuses,ballast,etc.)--$10,000.
(2) At the end of debt service,net savings will equal annual energy savings,less any ongoing maintenance tied to bulb
replacement.
Note: The LOCAL program only borrows twice a year--in February and August. We are already
too late for the February 2017 borrowing, so we will be included in the August borrowing. By then
we should know if we get the Dept of Commerce grant. To cash-flow the project, we can do an
interfund loan from Transit Capital Fund for the few months it will take between paying for the
project and the borrowing. The LOCAL program doesn't allow for early payback,but that
shouldn't be needed because we will know exactly what we will need to borrow by the August
deadline.
IMPACTS
1. Fiscal Impact—$2.1 million.
2. Proposed Funding Source-Energy Rebates$220,000, State Grant$350,000, Councilmanic
bonds$1.53 million. This program is eligible for the State Treasurers Local Option Capital
Asset Lending(LOCAL)program. (The City has used the LOCAL Program in the past for
the Police Fleet expansion and Fire apparatus.)
3. Public Impact-Improved safety and security along public rights-of way.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives-Continue to only fund$18,000 per year towards street lights.
11/28/16 Council Presentation • Unbudgeted Expenditures -11
PUBLIC WORKS/STREETS
2017 STRATEGIC INITIATIVE
SIDEWALK REPAIR/INSTALLATION& TREE REMOVAL
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Sidewalk Repair/Installation&Tree Removal Street Fund $50,000
$50,000 per year for 5 years(2017-2022) or Transportation
Benefit District
PROPOSAL
Many areas within the City either lack sidewalks or the existing sidewalks are in poor condition.
The majority of sidewalk damage in the City is caused by overgrown trees and their roots. In many
cases the damage is so severe, the sidewalk becomes a safety hazard and nearly impassable for the
public.
The Streets Division is proposing budget approval of$50,000 per year to address sidewalk
repair/installation and tree removal. The emphasis will be on repair of existing sidewalks. It
should be noted that the Streets Division does not have the equipment or expertise to safely remove
large trees and stumps, so such work would be contracted out to a local tree service. However, the
sidewalk repair/installation would be conducted by City staff. With the labor being provided by
the Streets Division, the funds would be utilized for tree removal and materials needed for the
sidewalk repairs/installations.
The program would significantly improve pedestrian mobility throughout the City, and most
importantly,begin to address these public safety hazards;reducing the City's liability for injuries
and other damages.
IMPACTS
1. Fiscal Impact-$50,000 per year for five (5) years.
2. Proposed Funding Source-General Fund or Transportation Benefit District (TBD).
3. Public Impact—None.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives-Rely upon grants when and if available to fund the program.
11/28/16 Council Presentation • Unbudgeted Expenditures -12
PUBLIC WORKS/STREETS
2017 STRATEGIC INITIATIVE
ADD TWO TRAFFIC SIGNS &MARKING SPECIALIST POSITIONS
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Add two Traffic Signs&Marking Specialist Street Fund $120,000
positions
PROPOSAL
The Signs &Marking Shop within the Streets &Traffic Operations Division is currently staffed with
three full-time personnel and one unbudgeted temporary worker during the summer months. In
2010, the Shop consisted of six budgeted full-time personnel. Due to the significant staffing
reduction,better equipment and materials were purchased and the level of maintenance of signs
and traffic markings reduced. Necessary changes in the maintenance level includes:
➢ Non-maintenance of select pavement markings, primarily in residential areas
➢ Inability to annually maintain all required pavement markings
➢ Reduced response to graffiti/vandalism of signs
➢ Inability to proactively replace aging signs
➢ Inability to meet federal requirements for sign maintenance and inventory.
All of these measures continue to increase the City's liability exposure. The inability to meet these
federal requirements may result in the loss of future funding for roadway projects.
The total compensation for a Traffic Signs &Marking Specialist is approximately$60,000 per year.
Two full-time positions are needed to attain the necessary level of sign and pavement marking
maintenance.
IMPACTS
1. Fiscal Impact—$120,000.
2. Proposed Funding Source—General Fund.
3. Public Impact—None.
4. Personnel Impact-Increase staff by two full-time positions.
5. Required Changes in City Regulations or Policies—None.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives-Continue existing staffing and maintenance levels.
11/28/16 Council Presentation • Unbudgeted Expenditures -13
PUBLIC WORKS/STREETS
2017 STRATEGIC INITIATIVE
ADD ONE TRAFFIC TECHNICIAN POSITION
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Add One Traffic Technician position Street Fund $55,000
PROPOSAL
The Traffic Engineering Division is currently staffed by the Streets& Traffic Operations Manager
and the Traffic Signal System Analyst. Two Traffic Technician II positions were eliminated in 2014
due to a change in funding priorities. The technician positions are needed to conduct necessary
data collection and routine traffic safety investigations. Presently those tasks fall to the Streets&
Traffic Operations Manager and are done as time is available. The result is long delays in
responding to traffic safety complaints, traffic count requests, parking modification requests, and
other traffic related inquiries by the public or internal customers.
The total annual compensation for a Traffic Technician I is approximately$55,000 per year. At least
one full-time position is needed to reestablish a basic data collection and traffic investigation
program.
IMPACTS
1. Fiscal Impact-$55,000.
2. Proposed Funding Source-General Fund.
3. Public Impact-None.
4. Personnel Impact-Increase staff by one full-time position.
5. Required Changes in City Regulations or Policies-None.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Continue existing staffing level with minimal data collection and
safety investigation efforts.
11/28/16 Council Presentation • Unbudgeted Expenditures -14
CITY WIDE/NEW REVENUE
2017 STRATEGIC INITIATIVE
ESTABLISH BROKERED NATURAL GAS UTILITY TAX
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Establish Brokered Natural Gas Utility Tax General Fund Revenue
Limits must match natural gas tax—applying Current cap—$54,000
current cap of$4,000 creates$54,000 of new $5,000 cap—60,000
revenue. Raising cap to$5,000 creates No cap—113,000
$60,000.
PROPOSAL
To establish a tax rate of 6%upon consumers of brokered natural gas. RCW 35.21.870 authorizes
cities to impose this tax, and the Washington Administrative Code (WAC)458-20-17902 gives
additional guidance on how this tax is calculated and reported to the Washington State Department
of Revenue (DOR). The following is an excerpt from a DOR publication:
History
The state and municipal taxes on brokered natural or manufactured gas were adopted by the
Legislature in 1989;the effective date of the taxes was July 1, 1990.
The need for these taxes was a result of federal deregulation of the natural gas industry. Increasingly,
large industrial and institutional users of gas have been able to make purchases of gas from sellers in
other states through brokers;this enables large purchasers to take advantage of differentials on the spot
market for natural gas. Although the gas may be delivered through the pipeline of a local gas company,
the transaction is considered to take place out of state. Some utilities had been reporting retail sales tax
on such sales and some purchasers had reported use tax,but there was confusion about the tax liability
of such transactions until the Legislature enacted the 1989 statute.
There are currently 274 taxpayers that report use tax on natural/manufactured gas. The Department
currently administers the municipal use tax on natural/manufactured gas for 46 cities,although not
every one of them receives revenues each year depending upon when the taxable transactions occur.
Washington State Department of Revenue, "Brokered Natural Gas Use Tax RCWS 82.12.022 and
82.14.230" 14October,2016.
http://dor.wa.gov/docs/reports/2010/tax reference 2010/24brokeredgas.pdf
In discussion with a representative from DOR, this tax rate would need to mirror the local tax rate
for natural gas. In other words, if the lid on our natural gas utility tax stays at 4% on the first$4,000
per customer per month,the Brokered Natural Gas would need to have the same lid. Based on
information from Department of Revenue, the City would have collected about$54,000 in the past
year if the current tax rate of 6% on all amounts up to$4,000/customer/month, and 2% on all
11/28/16 Council Presentation • Unbudgeted Revenues -1
amounts greater than$4,000 had been in place. If the lid was removed and 6% was charged on the
full monthly amount, we would have received$113,000.
Most of the cities comparable in size (i.e. Population 50,000-130,000)have imposed this tax:
Auburn Kirkland
Bellevue Marysville
Everett Redmond
Kennewick Renton
Kent Richland
Also,many other cities in neighboring communities and in Eastern Washington:
Goldendale Selah
Wenatchee Grandview
Spokane Pasco
Sunnyside Prosser
Union Gap Pullman
Walla Walla
IMPACTS
1. Fiscal Impact-$113,000 annually to General Fund Revenue if imposed with no$4,000 lid
on 4% of the tax or$54,000 with a$4,000 lid. If the lid is increased to$5,000, the City can
expect to receive$60,000. With the Department of Revenue requirements to start a new tax
only at the beginning of a quarter coupled with a 75 day notice, the earliest the City could
start collection of the tax is April 1, 2017. This changes the 1st estimates to$45,000 with a
$5,000 cap and$84,750 if the cap is totally removed.
2. Proposed Funding Source-General Fund Revenue.
3. Public Impact-This would affect 8 customers-primarily large manufacturing businesses-
resulting in an average increase of$7,500 per customer per year if the$5,000 cap is chosen,
and$14,125 per customer if the cap is totally eliminated.
4. Personnel Impact-The City would not need a collection effort--the State Department of
Revenue would collect and submit the tax to the City in our monthly remittance.
5. Required Changes in City Regulations or Policies-Revise YMC 5.50-050-050 to include
Brokered Natural Gas or establish a new and separate code. The earliest we could start
collecting is April 1,because the Department of Revenue requires 75 day notice.
6. Legal Constraints, if applicable-No legal constraints when assessing tax of 6% or less.
7. Viable Alternatives-None.
11/28/16 Council Presentation • Unbudgeted Revenues -2
CITY WIDE/NEW REVENUE
2017 STRATEGIC INITIATIVE
ELIMINATE LID ON ELECTRIC,NATURAL GAS AND TELEPHONE TAX
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Eliminate or modify cap on electric,natural General Fund Revenue
gas and telephone tax. Raise cap from$4,000 $5,000 cap -$36,000
to$5,000. No cap-760,000
PROPOSAL
Eliminate the$4,000 lid of 6%tax to electric,natural gas, and telephone users-potential revenue of
$760,000 annually. This affects primarily larger manufacturing businesses.
Washington State Revised Code of Washington (RCW) 35.21.870 allows a city to impose a tax on
electricity, telephone,natural gas, or steam energy business, with a limit of six percent without a
vote of the people. Yakima Municipal Code (YMC) 5.50-050-050 and YMC 5.50-050-060 governs the
City's imposition of this particular tax.
YMC 5.50-050-050
"There are levied and shall be collected annual license fees or taxes against the persons on account
of business activities as follows:
Since October 1, 1994, the rates of tax...shall be measured against a maximum of the first four
thousand dollars of the total gross revenue attributable to selling or furnishing telephone services...
or natural gas to any one customer in any one calendar month or fraction thereof.
Since October 1, 1994, the first four percent of the tax is measured against a maximum of the first
four thousand dollars of the total gross revenue attributable to selling or furnishing electric light or
power to any one customer in any one calendar month or fraction thereof;two percent of the
tax...shall be measured against the total gross revenue attributable to selling or furnishing electric
light or power."
In 2005, the tax on natural gas was changed to mirror electricity. "Since November 17, 2005, the
first four percent of the tax set forth...shall be measured against a maximum of the first four
thousand dollars of the total gross revenue attributable to selling or furnishing natural gas to any
one customer in any one calendar month or fraction thereof;two percent of the tax...shall be
measured against the total gross revenue attributable to selling or furnishing natural gas."
11/28/16 Council Presentation • Unbudgeted Revenues -3
Explanation:
Telephone services are totally capped at$4,000 per customer per month,while electricity and
natural gas tax the first$4,000 at 6%, and amounts greater than$4,000 at 2%. The following is an
example of the tax calculation, assuming a monthly electric or gas bill of$10,000:
Current Cap No Cap
6%on$4,000 $240 6%on$10,000 $600
2%on$6,000 excess 120
Total Tax $360 Difference $240
We asked Pacific Power to provide information on different cap amounts. They provided the
previous year's data from October 2015 through September 2016. We could determine that the
additional amount of tax for Cascade Natural Gas customers would only be about$40,000 if the cap
was totally eliminated, so we did not request additional detail. This calculation was based on
calendar year 2015. The following table summarizes the data from Pacific Power and Cascade
Natural Gas:
Max#of Capped Amount excluded Additional Monthly
Cap on 4% Accounts annually Annual Tax Cumulative Impact
$4,000 to$5,000 108 to 96 $18.0m to$17.1m $36,126 $36,126 40
$5,000 to$6,000 96 to 87 $17.1m to$16.3m 32,761 68,887 80
$6,000 to$7,000 87 to 73 $16.3m to$115.5m 29,470 98,357 120
$7,000 to$8,000 73 to 64 $15.5m to$14.8m 127,446 127,446 160
$8,000 to$9,000 64 to 60 $14.8m to$14.3m 20,251 147,697 200
$9,000 to$10,000 60 to 55 $14.3m to$13.7m 23,422 171,119 240
Total Elimination 108 $18.0m 720,243
CNG Total Elim 60 in winter-6-10 $992,000 39,696 39,696
May thru Nov
Total Elec&Gas $759,939
If the cap is totally eliminated, 108 companies will be paying a total of about$760,000 more per
year, which calculates to an average of$7,037 a year per company, or$586 a month. In looking at
this stratification,53 accounts (about half of the 108) would still benefit from a cap set at$10,000 a
month. The maximum increase for any one account moving to a$10,000 cap is$240 a month
($6,000 x 4%) or$2,880 per year.
We also compiled information on what other cities in the state charge for taxes on electric and
natural gas utilities. This was excerpted from the 2014 Municipal Tax Data survey. Generally,most
comparable cities have the 6%tax imposed and very few have caps on the tax. The detailed
spreadsheet is attached. This analysis does not consider telephone taxes,because we could not
determine the numbers of accounts affected.
At the October 24th Study Session a Council member asked if there was a time frame authorized
when the original cap was placed in 1994. Upon review of the original documents, there was no
mention of an expected time-frame or a"sunset" clause.
11/28/16 Council Presentation • Unbudgeted Revenues -4
IMPACTS
1. Fiscal Impact—Up to$760,000 annual increase to General Fund Revenue,less if cap is
raised but not eliminated.
2. Proposed Funding Source—General Fund Revenue.
3. Public Impact—Affects primarily large manufacturing businesses.
4. Personnel Impact—The utilities self-report—staff would need to communicate the change
to the effected companies.
5. Required Changes in City Regulations or Policies—Revise YMC 5.50-050-050.
6. Legal Constraints, if applicable—No legal constraints when assessing tax of 6% or less.
7. Viable Alternatives—This is a Council policy decision.
11/28/16 Council Presentation • Unbudgeted Revenues -5
Utility Taxes Imposed by Washington Cities
Excerpted from the 2014 Municipal Tax Survey compiled by AWC
Natural
City Population Gas Electricity Telephone Cellular Caps(based on City research)
Union Gap 6,037 6.00% 6.00% 6.00% 6.00% No cap
Spokane 212,300 6.00% 6.00% 6.00% 6.00% Cap-elc.&gas over$100,000 annual
Tacoma 200,900 6.00% 6.00% 6.00% 6.00% No cap
Vancouver 167,400 6.00% 6.00% 6.00% 6.00% Elec.-6%up to$1.5 mill/mo,then 2%Gas-6%up to
$2,000/mo,then 1.25% No cap on either phone
Bellevue 134,400 5.00% 5.00% 5.00% 6.00% No cap
Everett 104,900 4.50% 4.50% 4.50% 4.50% No cap
Kent 121,400 6.00% 6.00% 6.00% 6.00% No cap
Federal Way 90,150 No cap. Sr.rebate for income only--must be applied for
Yakima 93,080 6.00% 6.00% 6.00% 6.00% $4,000 per account per mo.Cap on 4%--2%uncapped
Bellingham 82,810 6.00% Cap on gas only-$250,000 per acct.No accts affected
Lakewood 58,360 5.00% 5.00% 6.00% 6.00% No cap
Kennewick 77,700 8.50% 8.50% 8.50% 8.50% No cap
Renton 97,130 6.00% 6.00% 6.00% 6.00% No cap
Shoreline 52,740 6.00% 6.00% 6.00% 6.00% No cap
Redmond 57,700 6.00% 6.00% 6.00% No cap
Auburn 74,630 6.00% 6.00% 6.00% No cap
Kirkland 82,591 6.00% 6.00% 6.00% 6.00% No cap
Olympia 49,670 9.00% 9.00% 9.00% 9.00% No cap
Richland 52,090 8.50% 8.50% 8.50% 8.50% No cap
Pasco 67,770 8.50% 8.50% 8.50% 8.50% No cap
Edmonds 39,950 5.75% 6.00% 5.75% 5.75%
Bremerton 38,180 6.00% 6.00% 6.00% 6.00%
Puyallup 38,670 2.20% 2.20% 2.20%
Longview 37,040 6.00% 6.00% 6.00% 6.00%
Lacey 45,320 6.00% 6.00% 6.00% 6.00%
Burien 48,240 6.00% 6.00% 6.00% 6.00%
Bothell 41,630 6.00% 6.00% 6.00% 6.00%
University Place 31,420 6.00% No 6.00% 6.00%
Walla Walla 32,260 6.00% 6.00% 6.00% 6.00% No cap
Des Moines 30,030 6.00% 6.00% 6.00% 6.00%
Marysville 62,600 5.00% 5.00% 5.00% No
Wenatchee 33,070 6.00% 6.00% 6.00% No
Mount Vernon 33,170 6.00% 6.00% 6.00% 6.00%
Pullman 31,420 8.00% 8.00% 8.00% 8.00% No cap
Mercer Island 23,310 6.00% 6.00% 6.00% 6.00%
Bainbridge Island 23,360 N/A 6.00% 6.00% 6.00%
Oak Harbor 21,940 6.00% 6.00% 6.00% 6.00%
Mountlake Terrace 20,530 6.00% 6.00% 6.00% 6.00%
Mukilteo 20,540 6.00% 6.00% 6.00% 6.00%
Kenmore 23,370 4.00% 4.00% 6.00% 6.00%
Port Angeles 19,090 n/a 6.00% 6.00% 5.50%
Tukwila 19,210 6.00% 6.00% 6.00%
Aberdeen 16,850 6.00% 6.00% 6.00% No
Ellensburg 18,440 6.00% 6.00% 6.00% 6.00%
Maple Valley 24,230 6.00% 6.00% 6.00%
Moses Lake 21,600 6.00% 6.00% 6.00% 8.00% Tele/Elec-$100K W/S-$150K
Average Rate 5.52% 5.66% 5.85% 5.09%
Note:Utility tax rates are based on a 2014 survey conducted by AWC. Only cities with a population>16,000 are shown. Bolded
cities are often used as comparables for Yakima.If there is an entry in the"Caps"column these were researced by Finance to
determine if there is a cap on individual utility accounts.
11/28/16 Council Presentation • Unbudgeted Revenues - 6
CITY WIDE/NEW REVENUE
2017 STRATEGIC INITIATIVE
ESTABLISH TRANSPORTATION BENEFIT DISTRICT/IMPOSE TAB FEE
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Establish Transportation Benefit District and Street Revenue
impose a vehicle tab fee Construction $10-$685,000
Fund $12—$822,000
$15-1,028,000
$20—1,371,000
PROPOSAL
To establish a Transportation Benefit District (TBD) and impose a vehicle license tab fee.
History
In 2012 the City formed a Transportation Benefit District (TBD) and created a five year project list.
City Council considered funding options, including a public vote for$20 vehicle tabs,but
ultimately did not identify a funding source and the TBD was dissolved. If council reformed a
TBD, the Finance department annually estimates revenue from a$20 vehicle tab fee would generate
approximately$1,371,000, a$15 vehicle tab fee would generate approximately$1,028,000 while a
$10 vehicle tab fee would generate approximately$685,000.
Creating a TBD
Since 2012, a number of legislative changes have been made to the laws regarding TBD's. The laws
surrounding TBD's can be found in the Revised Code of Washington Chapter 36.73 and the related
citations found there. The legislative authority has the power to form a TBD and make the initial
decision regarding transportation improvements. Once the transportation improvements have
been identified, the Council must conduct a public hearing with at least ten days'notice. Following
the hearing, Council may establish the TBD by ordinance if they make the finding the action is in
the public interest.
There are a number of requirements for the ordinance establishing the TBD and must include the
functions and transportation improvements to be funded then also establish the boundaries of the
TBD. To take advantage of some other benefits in the law, the boundaries should be the city limits.
The transportation improvements proposed may not be expanded beyond those that were included
in the initial hearing notice unless there are further notices and findings made that would be in the
public interest to expand the improvements.
Once formed, the Council acts as ex officio and independent members of the TBD governing body.
The City treasurer acts as the ex officio treasurer and the registered voters residing within the
district are the electors.
11/28/16 Council Presentation • Unbudgeted Revenues - 7
Funding a TBD
There are multiple funding options once a TBD has been established. The most common is a$20
vehicle license fee and can be established with a vote of the governing board if the boundaries of
the TBD are the same as the boundaries of the City. After 24 months the fee can be increased to$40
by the governing board and then to$50 after another 24 months. An important note is that actual
fee cannot be imposed within 180 days after being passed and that the department of licensing will
keep a 1% administrative fee.
The only other revenue that may be imposed without a vote of the electors are fees on certain
construction projects but the fees have to be reasonably necessary as a result of the impact of
construction.
All other funding sources must be approved by a vote of the electors and include a one year ad
valorem property tax, an ad valorem property tax to pay off voter approved general obligation
bonds,vehicle tolls and a sales tax.
Projects
The legislature has defined "transportation project" to mean a project contained in the
transportation plan of the state, a regional transportation planning organization, city, county, or
eligible jurisdiction. A project may include investment in new or existing highways of statewide
significance, principal arterials of regional significance,high capacity transportation, public
transportation, and other transportation projects and programs of regional or statewide significance
including transportation demand management. Projects may also include the operation,
preservation, and maintenance of these facilities or programs. There is also a set of criteria that
have to be considered when choosing which transportation improvements to put on the project list
and includes improved travel times, air quality, freight mobility and other criteria as may be
developed by the governing body.
Material Change Policy and Annual Report
The TBD shall also develop a material change policy to address major plan changes that affect
project delivery and financing. At a minimum, the policy must address material changes to cost,
scope, and schedule, the level of change that will require governing body involvement, and how
the governing body will address those changes. The policy must also include a provision that if a
transportation cost exceeds its original cost by more than twenty percent, there will be a public
hearing to solicit comment from the public regarding how the cost change should be resolved.
Another requirement is the TBD shall issue an annual report to the public and newspapers
indicating the status of costs, expenditures,revenues, and schedules.
Termination
Once construction is complete, the TBD must terminate day-to-day operations and exist as a limited
entity that oversees the collection of revenue and the payment of debt still in effect. When the debt
is complete and paid, the TBD has thirty days to dissolve itself with notice of the dissolution
published.
11/28/16 Council Presentation • Unbudgeted Revenues -8
Assumption
In 2015, the legislature allowed for a city to assume the rights, powers, functions, and obligations of
the TBD after notice and a hearing. This can be done through ordinance or resolution and after a
finding that the public interest or welfare would be satisfied by the city assuming those duties and
obligations.
At their October 24th study session, City Council asked for additional information including the
status of projects on the 2012 list and a potential list of projects for this new TBD proposal. These
will be presented during the Engineering Divisions budget review.
IMPACTS
1. Fiscal Impact-
$20 License tab fee $1,371,000
$15 License tab fee $1,028,000
$12 License tab fee $822,000
$10 License tab fee $685,000
2. Proposed Funding Source-Street Construction Fund.
3. Public Impact-Additional car tab fee to fund needed street improvements.
4. Personnel Impact-None.
5. Required Changes in City Regulations or Policies-Create an ordinance setting forth the
new fee. Contract with Department of Licensing to collect the fee.
6. Legal Constraints, if applicable-Council can only impose up to a$20 fee.
7. Viable Alternatives-This is a Council decision.
11/28/16 Council Presentation • Unbudgeted Revenues - 9
Transportation Benefit District Proposed Projects
In 2012, establishment of a Transportation Benefit District (TBD) was considered but not
implemented. A list of 21 projects that amounted to an estimated cost of$10,171,000 was
submitted. Eleven of the projects listed were eventually constructed as parts of the 2013 and 2014
Street Resurfacing Projects and are highlighted on the attached spreadsheet. As we move forward,
the remaining projects will be further evaluated for inclusion in future projects.
If a TBD was established at$20/car, it would generate approximately$1.3 million annually. We
recommend that the funds be used as follows:
• $300,000 for sidewalk repair and/or installation (priority given to school zones),including
tree removal (would provide approximately$100,000 of general fund relief)
• $500,000 to pay debt service on bonds for large projects (see list below)
• $500,000 to pay for and/or supply match for smaller projects and local street maintenance
(would provide approximately$200,000 of general fund relief)
The list of projects from the City's Transportation Improvement Program (TIP) recommended to be
considered in the large project list, for which bonding would be needed, includes:
• North 1st Street Revitalization, Phase 2-$8.5 Million
This project would improve N. 1st Street from MLK Boulevard to'N' Street by
rehabilitating the pavement and lane markings,removing on-street parking,enhancing
pedestrian and street lighting, constructing median islands and installing various
pedestrian and decorative elements.
• E. Nob Hill Boulevard Reconstruction-$9.5 Million
This project would improve Nob Hill Boulevard from 6th Street to 18th Street by
reconstructing and widening the roadway to five lanes with intersection improvements,
curb, gutter, sidewalk, street lighting and drainage system.
• 16th Avenue and Tieton Drive Intersection Improvements-$5.8 Million
This project would reconstruct and widen the 16th Avenue and Tieton Drive intersection
by adding a left-turn lane for all directions at the intersection, constructing larger radii at
the corners and updating the traffic signal.
• 6th Avenue Roadway Improvements-$4.4 Million
This project would improve 6th Avenue from Walnut Street to River Road by
reconstructing the existing trolley rail and impacted roadway, grinding and overlaying the
remaining width of 6th Avenue and installing curb, gutter and sidewalk, where missing.
The list of smaller projects from the City's TIP recommended to be considered as funds are
accumulated includes:
• Washington Avenue and Longfiber Road Intersection Improvements-$1,023,000
11/28/16 Council Presentation • Unbudgeted Revenues -10
This project would improve the Washington Avenue and Longfiber Road Intersection by
constructing a westbound left-turn lane on Washington and northbound left-turn lane on
Longfiber, installing or replacing curb, gutter, sidewalk, street lighting storm drainage and
safety flashing signal.
• N. 16th Avenue and Fruitvale Boulevard Intersection Improvements-$806,000
This project would improve the 16th Avenue and Fruitvale Boulevard Intersection by
constructing larger radii at the corners, installing ADA ramps and upgrading the traffic
signal system.
• 1st Street and Washington Avenue Intersection Improvements-$2,000,000
This project would improve the 1st Street and Washington Avenue Intersection by
widening Washington Avenue to accommodate an additional lane, replace curb, gutter
and sidewalk and install an updated traffic signal system.
• 40th Avenue and Summitview Avenue Intersection Improvements-$1,100,000
This project would improve the intersection of 40th Avenue and Summitview Avenue by
widening Summitview Avenue to accommodate two eastbound left-turn lanes,
constructing larger corner radii and updating the traffic signal system.
• Powerhouse Road and Englewood Avenue Intersection Improvements-$728,000
This project would improve the Powerhouse Road and Englewood Avenue Intersection by
realigning the intersection, installing curb, gutter, sidewalk and safety flashing signal.
• Nob Hill Boulevard and Fair Avenue Intersection Improvements (match) -$256,000
This project would improve the Nob Hill Boulevard and Fair Avenue Intersection by
widening Nob Hill Boulevard to provide for a left-turn lane at the intersection, replacing
the curb, gutter, sidewalk and street lighting,updating the storm drainage system and
upgrading the traffic signal system.
• 18th Street Underpass (match) -$632,000
This project would replace the bridge on E. Yakima Avenue that crosses over 18th Street.
• Aquatic Center Roads-$700,000
This project would improve River Road from 34th Avenue to 40th Avenue by
reconstructing and widening the roadway to three lanes, installing curb, gutter, sidewalks
and street lights, as well as,making improvements to the intersection of River Road and
34th Avenue.
11/28/16 Council Presentation • Unbudgeted Revenues -11
Original 2012 Transportation Benefit District
Proposed 5-Year Project List
Cost/ Maint
Street From To Sq Ft Treatment SF Total Cost Year
Year 1
3rd St Arlington Beech 95000 Mill&Overlay $3.42 $324,900.00 2013
Lincoln Av 56th Ave 66th Ave 68880 Mill&Overlay $3.42 $235,569.60 2013
Yakima Av 12th Ave 16th Ave81200 CIR $4.87 $395,444.00' 2013
$955,913.60
Year 2
D st 1st St 5th Ave 122200 CIR $4.87 $595,114.00' 2014
25th Av Englewood Castlevale 31050 Mill&Overlay $3.42 $106,191.00 2014
Lincoln Av 40th Ave 46th Ave 77000 CIR $4.87 $374,990.00 2014
$1,076,295.00
Year 3
Pecks Canyon Rd Scenic Dr City Limit 4620 Mill&Overlay $3.42 $15,800.40 2015
Viola Av 1st St Fair Ave 35100 Mill&Overlay $3.42 $120,042.00 2015
24th Av Washington Mead 122500 CIR $4.87 $596575.00 2015
G St 3rd St 6th St 38400 Mill&Overlay $3.42 $131,328.00 2014
G St 1st St 3rd St 22400 Mill&Overlay $3.42 $76,608.00 2015
Walnut St 3rd Ave 5th Ave 36400 CIR $4.87 $177;268.00' 2015
$1,117,621.40
Year 4
6th St Yakima Pacific 220000 Mill&Overlay $3.42 $752,400.00' 2016
Scenic Dr 4202 Scenic 4615 Scenic 53406 Mill&Overlay $3.42 $182,648.52 2016
Walnut St 1st St 3rd St 36400 CIR $4.87 $177,268.00' 2016
$1,112,316.52
Year 5
3rd Av Yakima Walnut 68000 CIR $4.87 $331,160.00' 2017
Lincoln Av 24th Ave 32nd Ave 109000 CIR $4.87 $530;830.00' 2017
$861,990.00
Unfunded
24th Av Mead Nob Hill 127400 CIR $4.87 $620,438.00'
Walnut St 5th Ave 7th Ave 36400 CIR $4.87 $177;268.00'
Pierce Av Summitview Lincoln 40000 Mill&Overlay $3.42 $136,800.00'
Fruitvale Blvd 2100 3000 256000 HIR $7.73 $1,978,880.00
Fruitvale Fruitvale
Fruitvale Blvd 3000 4000 276000 HIR $7.73 $2,133,480.00
Fruitvale Fruitvale
$5,046,866.00
D Street is not an arterial but is critical for emergency response.
11/28/16 Council Presentation • Unbudgeted Revenues -12
CITY ADMINISTRATION/ECONOMIC DEVELOPMENT
2017 STRATEGIC INITIATIVE
SPECIAL EVENT FEE INCREASE
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Special Event Fee Increase General Fund Revenue—
2017-$9,550
2018-$19,100
PROPOSAL
The City currently charges$50 for special event permits, which cover only a small fraction(on
average roughly 6%) of the cost of the staff time to ensure public safety, community and business
notification, insurance coverage review and to provide the barricades, cones and tents for events.
It is recommended that the special event fee be increased to recapture up to 50% of the actual costs
associated with special events. See attached memo for a more detailed explanation.
IMPACTS
1. Fiscal Impact—Approximately$9,550 to$19,100 in additional general fund revenue,
assuming a recapture rate of 25% and 50%,respectively. This can be done over two years.
2. Proposed Funding Source—Increased fees for special events permits.
3. Public Impact—Additional fees charged for special events.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—Change the City's municipal code.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives—Continue subsidizing special events.
11/28/16 Council Presentation • Unbudgeted Revenues -13
Memorandum
To: Cliff Moore
From: Sean Hawkins, Economic Development Manager
Date: November 2, 2016
Subject: Special Event Permit Fee Recommendation
The City currently charges a flat fee of$50 for any special event in the City regardless of size or
complexity. The following is a recommended change to the City's Special Event Permit Fee:
$50 fee—Events that are basic in nature (block parties, Capitol Theatre 3rd Street closure, charity
walks that do not close streets) and require no barricades or cones from the City of Yakima. Of the
50 events the City of Yakima permits each year, roughly 10 of them would remain in this category.
$200 fee—Events that require a more extensive review of event layout, insurance certificates and
public safety procedures. These events typically require the usage of City of Yakima issued
barricades and cones for traffic control and public safety. This would include the Yakima Farmers
Market, 3 on 3 hoops tournament, 5 K runs, Fresh Hop Ale Festival and other large events. Of the
50 events the City of Yakima permits each year, roughly 40 of them would be moved into this
category.
$15 per day power fee for events that use 110 power outlets in various throughout the City.
$50 per day power fee for events that require access to 220 power outlets that often require the City
of Yakima Street Department to visit the site in advance of the event to ensure the outlets are
working properly.
11/28/16 Council Presentation • Unbudgeted Revenues -14
Washington City Special Event and Parade Permit Fees—November 2016
City Application Fee Other Fees
Yakima $50 No fee for barricades and cones/$10 fee for tent usage
Non-profit events pay 50%of City Service fee
For profit events pay 100%of City Service fee
Bellevue $35 Fun Run/Bike Race(moving closure)-$1,400
Race/Parade(closed course)-<3 hours-$3,500
Race/Parade(closed course)->3 hours-$5,600
Fee for Festival/Fair(closed course)-<5,000 attendees-$1,050
Fee for Festival/Fair(closed course)-5,000-25,000 attendees-$1,050
Fee for Festival/Fair(closed course)-25,001 -50,000 attendees-$7,000
Fee for Festival/Fair(closed course)-<50,001 attendees-$10,500
Montlake Terrace $80<125 participants Events Pay 100%cost of City services based on a series of 8 factors
$120>125 participants
Redmond $128.71 Events pay for City services on the following scale:
100%for privately sponsored events
50%for City co-sponsored event
0%for City sponsored event
Walla Walla $75 Negotiated based on the size of the event&admission cost
Renton $50 Events Pay 100%of the cost of City Services involved in the event
Applicants provide deposit in advance
Woodinville Non-profit$182 Events Pay 100%of the cost of City Services involved in the event
For Profit-$380 Applicants provide deposit in advance
Bonney Lake $100 Applicant is billed for the cost of all City Services
Gig Harbor $50 non profit Applicant pays 100%of cost for traffic control services
$500 for profit
Kirkland $160 $45 per hour for traffic control-four hour minimum per off duty officer.
Applicant pays 100%of all city costs involved to produce event
Poulsbo N/A Applicant pays 100%of City's cost for event including traffic control,
barricade set up and trash service
Woodinville $397<100 people Applicant pays 100%of City's cost for event including traffic control,
$893>100 people barricade set up and trash service
Anacortes N/A Applicant pays 100%of City's cost for event including traffic control,
barricade set up and trash service. The fees for the use of city services and
equipment,and prepayment,maybe waived in part or in full by the City
Council if they deem a large community benefit
Coupeville N/A Applicant pays 100%of City's cost for event including traffic control,
barricade set up and trash service
Ellensburg N?A 100%of officer time is paid by the applicant as determined by the Police Chief
In most of the cases,applicants are given an estimate of the total costs of city based services and these must be paid before
a permit is issued.
11/28/16 Council Presentation • Unbudgeted Revenues -15
Local Jurisdiction Special Event and Parade Permit Fees
Toppenish-No fee, applicant pays 100% of City services involved in the event including Police
time,barricade delivery etc.
Sunnyside-Event fee based on planned attendance. If at City owned park or located on City right
of way applicants will pay a fee based on expected attendance (see below). All applicants pay
$1,000 security deposit to the City.
Park Reservations-In City Park Reservations-Non City
49 and less $20.00/$50.00 deposit 49 and less $25.00/$50.00 deposit
50-100 $40.00/$75.00 deposit 50-100 $50.00/$75.00 deposit
101 -300 $60.00/$100.00 deposit 101 -300 $75.00/$100.00 deposit
301-500 $100.00/$300.00 deposit 301-500 $125.00/$300.00 deposit
501 and up $151.00/$500.00 deposit 501 and up $188.75/$500.00 deposit
Centennial Square-In City Centennial Square-Non City
49 and less $30.00/$1000.00 deposit 49 and less $37.50/$100.00 deposit
50-100 $60.00/$100.00 deposit 50-100 $75.00/$100.00 deposit
101 -300 $90.00/$300.00 deposit 101-300 $112.50/$300.00 deposit
301-500 $150.00/$500.00 deposit 301-500 $187.50/$500.00 deposit
501 and up $240.00/$1,000.00 deposit 501 and up $300.00/$1,000.00 deposit
Union Gap-No fee,no loaning of City equipment (applicant must rent all street closure materials).
Applicant will pay any city services costs associated with event unless waived by City Council.
Prosser-$250 fee, applicant pays 100% of City services involved.
11/28/16 Council Presentation • Unbudgeted Revenues -16
Memorandum
To: City Manager, Cliff Moore
Community Development Director,Joan Davenport
From: Sean Hawkins, Economic Development Manager
Date: September 1, 2016
Subject: Special Event Permit Fee
Background
YMC 9.70 covers the City's special event policies and fee structure. The City currently charges$50
for special event permits which cover a small fraction of the cost of the staff time to ensure public
safety, community and business notification, insurance coverage review and providing the
barricades, cones and tents for events. In 2012 the City began providing barricades and cones for
special events at no charge to ensure that proper equipment is used to close City streets during
events. We currently charge a$10 per tent fee.
Additionally,we do not charge certain community events for the police time involved in closing
streets for well attended parades like the Sunfair Parade or Holiday Light Parade. Those events
involve the time of numerous officers and thousands of dollars in overtime costs all born by the
City. The following details regulate costs for special event in our municipal code:
➢ Special Event Permit Application Fee -A fifty dollar nonrefundable application fee must be
submitted with any special event permit application. Any event application submitted less
than three weeks before the scheduled event is subject to a one-hundred dollar late fee.
➢ City Services Permit Fee- Upon approval of an application for a permit for a special event
not protected under the First and Fourteenth Amendments of the U.S. Constitution, the
economic development manager should provide the applicant with a statement of the
estimated cost of city services,equipment and materials used or provided by city in
providing traffic control and management for parades and vehicle events, and permit fees.
Also exempt from the special event permit fee are the community events listed as follows:
Memorial Day Parade;Cinco De Mayo Parade;4th of July Celebration; Sunfair Parade;
Veterans Day Parade; and Christmas Light Parade.
Recommendation
An analysis of five random events for in the last year found that the City recouped roughly 6% of
the cost to produce special events from the permit fee. At a minimum, we should consider raising
the fee over to 50% over the course of two years and by moving that to 25%in 2017 and 50%in
2018. A 25%recoup would be a permit fee of$225 and a 50%recoup would be a permit fee of$450.
An analysis of smaller Washington cities reveals a trend to recoup more of the cost of issuing
special event permits. Cities like Sunnyside and Anacortes no longer have a single special event
permit cost but rather have moved to a case by case fee that reflects the costs of staff time to assist in
permitting the event by having the City departments involved calculate the cost of assisting and
passing them on to the permit holder. Prosser charges a$250 flat fee but also passes additional costs
11/28/16 Council Presentation • Unbudgeted Revenues -17
to produce the event on to the applicant if necessary. The City of Issaquah special event permit fee
is currently$20 and they are in the works of raising this fee to$200 in 2017 to assist in recouping
more of the cost to issue special event permits.
Total Total
Total Revenue Revenue
Revenue Generated Generated for
Fee Fee Fee Generated for 2015 2015
Required Required Required in 2015 with Assuming a Assuming a
Current to Reach to Reach to Reach Number of Present 25%Fee 50%Fee
Application 25% 50% 100% Applications Application Recapture Recapture
Base Fee Recapture Recapture Recapture in 2015 Fee Rate Rate
$50.00 $212.34 $424.67 $849.33 51 $2,550 $10,829.34 $21,658.17
Note: Council requested more information and options at the October 24th study session.
Toppenish—no fee, applicant pays 100%of City services involved in the event including Police time,
barricade delivery etc
11/28/16 Council Presentation • Unbudgeted Revenues -18
UTILITY RATE ADJUSTMENT SUMMARY
Summary of Options for Utility Rate Increases by Typical Household
Original Alternate Hybrid Proposal
Proposal Proposal Refuse @ 7.0%
$6.20 month $3.11 month $3.71 month
11/28/16 Council Presentation • Utility Rates-1
PROPOSAL 1 OF 2 (WASTEWATER)
UTILITIES& ENGINEERING/WASTEWATER
2017 STRATEGIC INITIATIVE
WASTEWATER RATE INCREASE
UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Wastewater Rate Increase Wastewater/ 2017 Revenue-
Program 2017 2018-2021 Stormwater Wastewater
Stormwater 63% 2.5%annually Customers $577,000
WW Retail 3% 3.0%annually Stormwater
WW BOD 16% 2.4%annually $1,357,000
WW TSS 7% 2.4%annually
WW FOG 35% 2.4%annually
2017
Ind Waste/UASB $7.84 plus 60%RTS
plus 60%RVR plus
100% SWC
2017-2019 2020-2021
WW Pretreat 18% 4.5%annually
PROPOSAL
This Strategic Initiative adopts the wastewater and stormwater rate recommendations from the
2014 Wastewater, Industrial Wastewater and Stormwater Rate Study (FCS Group, 2014). The adoption
of the recommended stormwater rates is necessary to fund the$2.5 million average annual
stormwater capital expenditure over the next ten years as identified in the 2013 Stormwater System
Collection Master Plan (Akel, 2013). Adoption of the recommended wastewater rates is necessary to
end residential customer subsidy of high-impact customers enrolled in the Pretreatment Program.
The wastewater utility operates and maintains the Pretreatment Program in order to perform
Federally-mandated monitoring, including wastewater sampling and facility inspection, of over 500
Yakima commercial and industrial wastewater customers. The Pretreatment Program is primarily
funded through a monthly Pretreatment charge to monitored customers and through strong waste
charges that should offset Pretreatment Program expenses. However, the utility is under-
recovering the cost of the Pretreatment Program by about$220,000 per year. A prior Rate Study
recognized this under-recovery and recommended a rate structure that would fully fund the
Pretreatment program. However,the recommended structure was only partially adopted, leading
to a continuation of the under-recovery and subsidy from residential customers. Adoption of the
recommended wastewater rate schedules would establish full Pretreatment Program cost recovery
within 3 years, consequently ending residential ratepayer subsidy of high-impact customers and
limiting residential rate increases to 3% annually. Finally, adoption of the recommended Industrial
Waste Line customer rate structure would establish assessments that reflect the cost of pre-treating
11/28/16 Council Presentation • Utility Rates-2
industrial wastewater in the Yakima Wastewater Treatment Plant's new high-rate anaerobic
digester (UASB).
Monthly Wastewater/Stormwater Charges for Typical
Single Family Customer
$60.0
Total$49.8 Total$51.3
$50.0Total$45.7
Total 7.0 Total 8.
tl$42.3
$40.0
$30.0
$20.0
$M.7 $39.8 $41. $42.3 $43.5 $44.8
$10.0
2016 2017 2018 2019 2020 2021
Stormwater Wastewater Total
BI-MONTHLY WASTEWATER AND STORMWATER CHARGE COMPARISON
Current 2016 Rates Proposed 2017 Rates Annual
Increase
Customer Type Stormwater Wastewater Total Stormwater Wastewater Total Total
Single Family Customer $7.16 $77.36 $84.52 $11.68 $79.68 $91.36 $41.04
(3/4"meter,6ccf/mo,1
storm ER U)
Multi Family $28.66 $189.56 $218.22 $46.72 $195.24 $241.96 $142.44
Residential
(5ccf/mo/unit,10 Multi-
Units,4 Storm ERUs)
Minor Industrial User $50.16 $533.40 $583.56 $81.76 $588.58 $670.34 $520.68
(1"meter,35 ccf/mo,7 Storm ERUs,
90 lbs/mo Strong Waste BOD,SPT
Charge)
IMPACTS
1. Fiscal Impact-Additional Wastewater Revenue--$807,500;Additional Stormwater
Revenue--$1,356,000
Program 2017 2018-2021
Stormwater 63% 2.5% annually
Wastewater Retail 3% 3.0% annually
Wastewater BOD 16% 2.4% annually
Wastewater TSS 7% 2.4% annually
Wastewater FOG 35% 2.4% annually
11/28/16 Council Presentation • Utility Rates-3
2017
Ind Waste/UASB $7.84 per hundred cubic feet of discharge, plus 60%
of the retail Ready-to-Serve charge, plus 60% of the
retail volume rate, plus 100% of the Strong Waste
Charges applied to the UASB effluent wastewater
strength
2017-2019 2020-2021
Wastewater Pretreat 18% 4.5% annually
2. Proposed Funding Source—Revenue is collected through Utility Billing and will be paid by
Wastewater and Stormwater customers residing within the city limits.
3. Public Impact—Stormwater and wastewater customers will see an increase in their utility
costs. The combined monthly single family wastewater and stormwater charge increases
8%from$42.26 in 2016 to$45.68 in 2017, with 2.9% annual increases from 2018 through
2021.
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—Amendments to the applicable City
Municipal Code will be required.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives—Implement increases at a lower rate than those identified in the 2014
rate study. Any reduction in rates would ultimately have the result of postponing
infrastructure projects which may result in higher project costs in the future or require
emergency action by the agency to address operational failures.
11/28/16 Council Presentation • Utility Rates-4
PROPOSAL 2 OF 2 (WASTEWATER)
UTILITIES& ENGINEERING/WASTEWATER
2017 STRATEGIC INITIATIVE
WASTEWATER RATE INCREASE -ALTERNATIVE
BUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Wastewater Rate Increase-Alternative Wastewater/ 2017 Revenue-
Program 2017 2018-2021 Stormwater Wastewater
Stormwater 27% Variable Customers $324,000
WW Retail 1.5% Variable Stormwater
WW BOD 16% 2.4%annually $580,500
WW TSS 7% 2.4%annually
WW FOG 35% 2.4%annually
2017
Ind Waste/UASB $7.84 plus 60%RTS
plus 60%RVR plus
100% SWC
2017-2019 2020-2021
WW Pretreat 18% 4.5%annually
PROPOSAL
At their roundtable discussion on September 27,2016, Council indicated that they support utility
rate increases to keep the utilities viable,however, their preference was to have the total of all the
increases be about half of the proposals for the typical household. With that direction in mind, staff
revisited the rate increases, and are modifying the Wastewater fee to increase by 1.5% (from 3.0%),
and Stormwater by 27% (from 63%). The increases in the Pretreatment rates and the changes in
charges to Industrial Waste Line customers are unchanged from the original proposal.
!Monthly WastowaterFStarrnwaterChar es for Typical Single
Family Customer
560.00
450.00 Total$4546 Tate$47.11 Total$4#1.66
Total$42.26
Total$43 81
......... ..... ...
...... ....
$40,00
630.00
$3$. 13
$33.26 S40.05 $41.05
$20.00 $42.36
$10,00
$0.04 $338 54.55 $5.41 $6.06 $6.30
2016 2017 2016 2019 2020
Stermwater Wastewater ater Ts tal
11/28/16 Council Presentation • Utility Rates-5
BI-MONTHLY WASTEWATER AND STORMWATER CHARGE COMPARISON
Current 2016 Rates Proposed 2017 Rates Annual
Increase
Customer Type Stormwater Wastewater Total Stormwater Wastewater Total Total
Single Family Customer $7.16 $77.36 $84.52 $9.09 $78.52 $87.61 $18.54
(3/4"meter,6ccf/mo,1
storm ERU)
Multi Family $28.66 $189.56 $218.22 $36.36 $192.40 $228.76 $126.48
Residential
(5ccf/mo/unit,10 Multi-
Units,4 Storm ERUs)
Minor Industrial User $50.16 $533.40 $583.56 $63.63 $584.68 $648.31 $388.5
(1"meter,35 ccf/mo,7 Storm ERUs,
90 lbs/mo Strong Waste BOD,SPT
Charge)
IMPACTS
1. Fiscal Impact-Provides revenue to recover Pretreatment Program costs,maintain
minimum operating reserves and debt coverage for Wastewater and Stormwater.
Program 2017 2018-2021
Stormwater $0.97 per ERU 11.7% average annually
Wastewater Retail 1.5% 2.6% average annually
Wastewater BOD 16% 2.4% annually
Wastewater TSS 7% 2.4% annually
Wastewater FOG 35% 2.4% annually
2017
Ind Waste/UASB $7.69 per hundred cubic feet of discharge, plus 60%
of the retail Ready-to-Serve charge, plus 60% of the
retail volume rate, plus 100% of the Strong Waste
Charges applied to the UASB effluent wastewater
strength
2017-2019 2020-2021
Wastewater Pretreat 18% 4.5% annually
2. Proposed Funding Source-Revenue is collected through Utility Billing and will be paid by
Wastewater and Stormwater customers residing within the city limits. Additional revenue
estimate is$324,000 for Wastewater and$580,500 for Stormwater-total of$904,500.
3. Public Impact-Stormwater and wastewater customers will see an increase in their utility
costs. The combined monthly single family wastewater and stormwater charge increases
3.7%from$42.26 in 2016 to$43.81 in 2017,with 3.6% annual increases from 2018 through
2020.
11/28/16 Council Presentation • Utility Rates-6
4. Personnel Impact—None.
5. Required Changes in City Regulations or Policies—Amendments to the applicable City
Municipal Code will be required.
6. Legal Constraints, if applicable—None.
7. Viable Alternatives—Future capital program projects will not be completed. Postponing
infrastructure projects may result in higher project costs in the future or require emergency
action by the agency to address operational failures.
11/28/16 Council Presentation • Utility Rates- 7
PROPOSAL 1 OF 2 (WATER)
UTILITIES& ENGINEERING/WASTEWATER
2017 STRATEGIC INITIATIVE
WATER RATE INCREASE—8.5%
UNBUDGETED
Strategic Initiative Request/Justification Proposed Personnel
Funding Source Salary/Benefits Non-Personnel
Water Rate Increase Water Customers 2017 Revenue
Program $740,000
2017 Water RTS 8.5%
2018 Water RTS 8.5%
PROPOSAL
The Water Rate Study for the years 2013 to 2017 was conducted. The full study is available for your
reference. This is the third multiyear Water Rate Study the City has conducted. The City adopted
the process of conducting five year rate studies in 1996 to help stabilize rates, keep rate increases as
low as possible, keep necessary increases as even as possible and in insure adequate funding for
operations and capital improvements. The Capital Improvement Program is adopted by City
Council through the six-year Water System Plan and is incorporated within this study.
The Rate Study that was completed in the fall of 2012 proposed three 9%and two 3 1/z%increases
over the following five years. The study was tabled while further review of the capital
improvement needs and costs could be completed. No rate increase was implemented in 2013. A
new study reflecting the true costs for the capital program was conducted in the spring 2013. This
updated study proposed a 4%revenue increase in each year starting in 2014 and ending in 2018.
No rate increases were implemented in 2014.
The 2013 study update, (Full study,update and connection charge memo are at
https://www.yakimawa.gov/services/water-irrigation/rate-studies/), did a closer analysis which shows
that the utility can choose not to implement the indicated 4%increase,taking no increase at all in 2014
and still maintain at least a 60 day operating reserve as well as proceed with the planned capital
improvement program until 2016. In 2017 and beyond,it is estimated that the operating reserve will
drop below 60 days. However,it is anticipated that currently unquantifiable increased revenue as a
result of the automated meter reading program and efficiencies in capital projects along with other cost
saving efforts will result in higher operating reserves in 2017 and 2018 than current forecast. Some
revenue did increase but was not sufficient without a rate increase and some capital improvements
were delayed again. There are a number of solutions including reducing transfers from the operating to
capital fund,further delaying certain capital projects and/or increasing the 2017-2018 rates.
Water sales are down and have been for several years due to the economic downturn and people using
less water through conservation. The study points out that Yakima is a bit lower in the fixed charges
(Ready-to-Serve)than the national average of 30%,currently we are at 22%fixed charge. Because of the
11/28/16 Council Presentation • Utility Rates-8
lower volume of water sales we raised our fixed charge to 27%of the revenue and lowered the volume
rate from$1.51 to$1.46 per 100 cubic feet of water in 2014. No additional revenue was to be generated
however some users saw a slight increase in their utility bill or a slight decrease.
No rate increases were implemented in 2013 through 2016. Four years of planned increases were
delayed. To recover some of the losses from not implementing rate increases as planned in the 2013
Rate Study Update, it is proposed to increase rates by 8.5%in 2017 and 2018. Transfers to capital
improvements will be reduced by$250,000 a year in 2017 and 2018. This leaves us just under the 60
days required operating reserve.
Connection charges were first implemented in 1998 and have not been increased from inception.
These charges are outdated and do not reflect the true cost of connection and should be increased
per the study.
The study includes a benchmarking analysis available for your reference. The benchmarking
analysis was conducted for two purposes, to look for deficiencies and to help find areas where we
might improve efficiency to reduce costs. The study indicated two areas where we are below
industry standards, training and water loss. The training budget has been increased along with
improved tracking of training. The water loss should improve with the new meters in the
automated meter reading program as it is probable that the system is not losing water,but rather
our old meters were not accurately measuring all of it.
IMPACTS
1. Fiscal Impact-Revenue increase in 2017 of$740,000
2. Proposed Funding Source-Water customers. Each year rates will be analyzed during the
budget preparation to determine if the proposed rate increase is warranted.
➢ 8.5%increase in 2017, and raise the fixed charges (Ready-to-Serve)from 27% of
revenue to 30% of revenue (this will not increase to overall revenue but help to
stabilize the revenue)
➢ 8.5%increase in 2018
3. Public Impact-Average residential water customer using 12 units of water would have an
increase of$3.02 every two months or$1.51 per month in 2017 and$3.22 every two months
or$1.61 every month in 2018.
4. Personnel Impact-None.
5. Required Changes in City Regulations or Policies-Will require an ordinance and public
hearing(can be conducted with Budget Public Hearing) to change rates.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Implement increases at a lower rate than those identified in the 2013 rate
study. Any reduction in rates would ultimately have the result of postponing infrastructure
projects which may result in higher project costs in the future or require emergency action by the
agency to address operational failures
11/28/16 Council Presentation • Utility Rates-9
PROPOSAL 2 OF 2 (WATER)
UTILITIES& ENGINEERING/WASTEWATER
2017 STRATEGIC INITIATIVE
WATER RATE INCREASE-5.0%
BUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Water Rate Increase-Alternate Water Customers 2017 Revenue
Program $434,750
2017 Water RTS 5.0%
2018 Water RTS 4.7%
PROPOSAL
At their roundtable discussion on September 27,2016, Council indicated that they support utility
rate increases to keep the utilities viable,however, their preference was to have the total of all the
increases be about half of the proposals for the typical household. With that direction in mind, staff
revisited the rate increases, and are modifying the Water fee to increase by 5.0% (from 8.5%).
We would recommend that the utility complete a Water Rate and Cost of Service Study in late 2017
or early 2018 after the 2017 Water System Plan is adopted,before setting rates further out in the
future.
The revenue collected as a result of this rate increase will allow for a transfer to Capital$675,000 in
2017 and this capital transfer will be reduced to$400,000 in 2018. In addition, it will stabilize the
operating reserve level.
The 2011 Water System Plan and the 2013 Water Rate Study had about$2,000,000 per year for aging
infrastructure replacement (old cast iron water mains). Rate increases planned each year from 2013
to 2018 were suspended for years 2013 to 2016. This caused the ageing infrastructure replacement
projects to be cancelled.
No aging infrastructure project is planned for 2017, causing the utility to be behind four years in
replacements. In 2018 the N. 1st Street Main Replacement project is scheduled. Up to$2,000,000 in
aging infrastructure replacement should be scheduled in 2019 keeping the minimum reserve of
$1,000,000.
IMPACTS
1. Fiscal Impact-Revenue increase in 2017 of$434,750
2. Proposed Funding Source-Water customers. Each year rates will be analyzed during the
budget preparation to determine if the proposed rate increase is warranted.
11/28/16 Council Presentation • Utility Rates-10
➢ 5.0%increase in 2017, and raise the fixed charges (Ready-to-Serve)from 27% of
revenue to 30% of revenue (this will not increase to overall revenue but help to
stabilize the revenue)
➢ 5.0%increase in 2018
3. Public Impact-Average residential water customer using 12 units of water would have an
increase of$1.79 every two months or$0.90 per month in 2017 and$2.01 every two months
or$1.00 every month in 2018.
4. Personnel Impact-None.
5. Required Changes in City Regulations or Policies-Will require an ordinance and public
hearing(can be conducted with Budget Public Hearing)to change rates.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Recommended capital program projects will not be completed or
pushed into the future. Postponing infrastructure projects may result in higher project costs
or require emergency action to address operational failures.
11/28/16 Council Presentation • Utility Rates-11
PROPOSAL 1 OF 2 (REFUSE)
PUBLIC WORKS/REFUSE
2017 STRATEGIC INITIATIVE
REFUSE RATE INCREASE- 7%
ORIGINAL-UNBUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Refuse Rate Increase Refuse Customers 2017 Revenue
2017-7.0% 2019-2.5% $473,000
2018-2.6% 2020-2.5%
PROPOSAL
This initiative proposes a 7.0%rate increase in Refuse rates for 2017 for expenses relating to
anticipated increases in Yakima County's landfill tipping fees and other operational costs effective
January 1,2017. The following table summarizes the expected cost increases for residents with a 96
gallon cart-there are 18,626 customers (72%) that have a 96 gallon cart for waste collection and
7,370 customers (28%)that have a 32 gallon cart for collection. Residents with a 32 gallon cart will
also incur a 7%increase of$1.13.
Cost Component 2016 2017 $A %♦
Labor Cost $2.76 $2.87 $0.11 4.2%
Collection Operations $4.70 $4.75 $0.05 1.0%
Disposal $3.46 $3.90 $0.44 12.7%
Customer Service $0.63 $0.75 $0.13 20.2%
Management&Administration $0.90 $1.10 $0.20 22.3%
Public Works &Billing and Finance Allocation $1.01 $1.12 $0.11 11.0%
Utility Tax/WA Refuse Tax $3.32 $3.56 $0.24 7.1%
Fund Reserve $1.55 $1.55 $- 0.0%
Total Rate $18.32 $19.60 $1.28 7.0%
City of Yakima Solid Waste and Recycling Division(SWRD)makes every effort to excel in quality
solid waste management for the 93,000 residents of Yakima. The core business of SWRD is to
provide weekly curbside residential garbage and yard waste service to approximately 26,000
residential customers who generate an average of 35,000 tons of waste per year. As part of the
Interlocal Agreement with Yakima County, the City of Yakima utilizes the county's Terrace Heights
Landfill to dispose of its waste.
Yakima County Public Services Solid Waste Division has advised the City that they have completed
a rate study for their current and future needs of their landfill. The proposed solid waste disposal
rates for 2017 will increase approximately 13% over the 2016 rates. The proposed rates will cover
the operational expenses, closure/post closure and capital costs for the Yakima County landfills.
11/28/16 Council Presentation • Utility Rates-12
Yakima Utility Tax and Washington Refuse Tax will increase proportionately to the rate increase
because both taxes are calculated on the assessed collection rate. The combined taxes comprise
18.6% of the total rate charged to the residential rate payers;the utility tax is 15% and the refuse tax
is 3.6%. The impact of these two fees is$0.33 per month for the customers with a 96 gallon cart.
Labor and operational costs will increase due to the City's labor agreement, increases in employee
health insurance, outside repair and maintenance cost for the collection fleet, and general liability
insurance.
The proposed rate increase included the addition of a Solid Waste Supervisor to its Division to
accommodate past growth in service areas and integration of the new Cayenta utility billing,
electronic routing and mobile management systems. The addition of a Solid Waste Supervisor
allows for the current supervisor to address daily operation duties such as customer service issues,
complaints, solid waste violations, safety issues, accident follow ups, address illegal clean ups, fleet
maintenance issues and supervision of the maintenance workers. The new supervisor position will
address the electronic routing implementation, on-going maintenance of the system and
supervision of route drivers.
The rate impact from the hiring of the SW Supervisor is$0.22 per residential customer per month in
2017;however, the cost per customer is expected to decrease in 2018 with the full implementation of
the electronic routing and mobile management system. Rate increases in 2018 and 2019 are
projected at 3.6% and 3.5%respectively;however, the collection efficiencies are expected to reduce
costs by 1%in 2018 and 2019. In other words, the cost of the SW Supervisor in 2017 will be offset by
the system savings of$0.21 per customer. Savings in 2018 is estimated at$0.22 and beyond. The rate
impact for the 96 gallon customer over the next four years are summarized in the following table.
2016 2017 2018 2019 2020
96 gallon rate $18.32 $19.60 $20.10 $20.60 $21.10
$Increase $1.28 $0.50 $0.50 $0.50
%Increase 7.0% 2.6% 2.5% 2.5%
Proposed Residential Rates for 2017 through 2019.
Year 2016 2017 2018 2019 2020
96 gallon rate-Solid Waste $18.32 $19.60 $20.10 $20.60 $21.10
32 gallon rate-Solid Waste $16.02 $17.15 $17.60 $18.05 $18.50
96 gallon rate-Yard Waste $14.90 $15.95 $16.35 $16.75 $17.15
96 gallon rate-2nd Yard Waste $7.40 $7.90 $8.10 $8.40 $8.60
Extra Can $4.23 $4.50 $4.60 $4.70 $4.80
Extra Bag $2.51 $2.70 $2.75 $2.80 $2.85
The following table details the proposed increase for container services for 2017. The increase is 7%
over the current collection rates.
11/28/16 Council Presentation • Utility Rates-13
Current 2016 Rates Container Size
Col.Frequency 2 YD 4 YD 6 YD
1 $21.53 $34.28 $47.04
2 $34.54 $59.70 $85.56
3 $47.55 $85.12 $124.08
4 $60.56 $110.54 $162.60
5 $73.57 $135.96 $201.12
Proposed 2017 Rates Container Size
Col.Frequency 2 YD 4 YD 6 YD
1 $23.04 $36.68 $50.33
2 $36.96 $63.88 $91.55
3 $50.88 $91.08 $132.77
4 $64.80 $118.28 $173.98
5 $78.72 $145.48 $215.20
IMPACTS
1. Fiscal Impact-The proposed 2017 Yakima County landfill tipping fee will be an additional
yearly cost of$134,000 to the City. The remaining cost increase are comprised of labor and
operational costs of approximately$299,000. The overall fiscal impact to the Refuse Division
is$433,000. Projected cost increases in 2018 and 2019 are approximately$170,000 each year.
2. Proposed Funding Source-Rate increase of 7%for all refuse collection rates in 2017.
Proposed rate increases in 2018 through 2020 are 2.5% of the prior year's collection rate.
3. Public Impact-This initiative will impact the public through a pass through rate increase
to cover the increased cost of landfill disposal.
4. Personnel Impact-None.
5. Required Changes in City Regulations or Policies-City ordinance revising the Refuse rate
schedule will be required.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Implement a rate increase at a lower rate than the identified in the
current rate study.
11/28/16 Council Presentation • Utility Rates-14
PROPOSAL 2 OF 2 (REFUSE)
PUBLIC WORKS/REFUSE
2017 STRATEGIC INITIATIVE
REFUSE RATE INCREASE-3.7%
ALTERNATE-BUDGETED
Proposed Personnel
Strategic Initiative Request/Justification Funding Source Salary/Benefits Non-Personnel
Refuse Rate Increase Refuse Customers 2017 Revenue
2017-3.7% 2019-3.0% $247,000
2018-3.1% 2020-3.0%
PROPOSAL
At their round table discussion on September 27,2016, Council indicated that they support utility
rate increases to keep the utilities viable,however, their preference was to have the total of all the
increases to be about half of the original proposals for the typical household-with that direction in
mind, staff revisited the rate increases, and are modifying the refuse fee to increase by 3.7% (from
7.0%)
This initiative proposes a 3.7%rate increase in Refuse rates for 2017 for expenses relating to
anticipated increases in Yakima County's landfill tipping fees and other operational costs effective
January 1,2017. The following table summarizes the expected cost increases for residents with a 96
gallon cart-there are 18,626 customers (72%) that have a 96 gallon cart for waste collection and
7,370 customers (28%)that have a 32 gallon cart for collection. Residents with a 32 gallon cart will
also incur a 7%increase of$1.13.
Cost Component 2016 2017 $A %♦
Labor Cost $2.76 $2.88 $0.12 4.5%
Collection Operations $4.70 $4.75 $0.05 1.0%
Disposal $3.46 $3.90 $0.44 12.7%
Customer Service $0.63 $0.75 $0.13 20.2%
Management&Administration $0.90 $1.09 $0.19 21.2%
Public Works &Billing and Finance Allocation $1.01 $1.12 $0.11 11.0%
Utility Tax/WA Refuse Tax $3.08 $3.19 $0.11 3.7%
Fund Reserve $1.79 $1.32 $(0.47) -26.3%
Total Rate $18.32 $19.00 $0.68 3.7%
City of Yakima Solid Waste and Recycling Division(SWRD)makes every effort to excel in quality
solid waste management for the 93,000 residents of Yakima. The core business of SWRD is to
provide weekly curbside residential garbage and yard waste service to approximately 26,000
residential customers who generate an average of 35,000 tons of waste per year. As part of the
Interlocal Agreement with Yakima County, the City of Yakima utilizes the county's Terrace Heights
Landfill to dispose of its waste.
11/28/16 Council Presentation • Utility Rates-15
Yakima County Public Services Solid Waste Division has advised the City that they have completed
a rate study for their current and future needs of their landfill. The proposed solid waste disposal
rates for 2017 will increase approximately 13% over the 2016 rates. The proposed rates will cover
the operational expenses, closure/post closure and capital costs for the Yakima County landfills.
Yakima Utility Tax and Washington Refuse Tax will increase proportionately to the rate increase
because both taxes are calculated on the assessed collection rate. The combined taxes comprise
18.6% of the total rate charged to the residential rate payers;the utility tax is 15% and the refuse tax
is 3.6%. The impact of these two fees is$3.19 per month for the customers with a 96 gallon cart.
Labor and operational costs will increase due to the City's labor agreement, increases in employee
health insurance, outside repair and maintenance cost for the collection fleet, and general liability
insurance.
The proposed rate increase included the addition of a Solid Waste Supervisor to its Division in 2016
to accommodate past growth in service areas and integration of the new Cayenta utility billing,
electronic routing and mobile management systems. The addition of a Solid Waste Supervisor
allows for the current supervisor to address daily operation duties such as customer service issues,
complaints, solid waste violations, safety issues, accident follow ups, address illegal clean ups, fleet
maintenance issues and supervision of the maintenance workers. The new supervisor position
addresses the electronic routing implementation, on-going maintenance of the system and
supervision of route drivers.
The rate impact from the hiring of the SW Supervisor is$0.22 per residential customer per month in
2017;however, the cost per customer is expected to decrease in 2018 with the full implementation of
the electronic routing and mobile management system. Rate increases in 2018 and 2019 are
projected at 3.1% and 3.0%respectively;however, the collection efficiencies are expected to reduce
costs by 1%in 2018 and 2019. In other words, the cost of the SW Supervisor in 2017 will be offset by
the system savings of$0.21 per customer. Savings in 2018 is estimated at$0.22 and beyond. The
rate impact for the 96 gallon customer over the next four year are summarized in the following
table.
2016 2017 2018 2019 2020
96 gallon rate $18.32 $19.00 $19.59 $20.18 $20.79
$Increase $0.68 $0.59 $0.59 $0.61
%Increase 3.7% 3.1% 3.0% 3.0%
Proposed Residential Rates for 2017 through 2019.
Year 2016 2017 2018 2019 2020
96 gallon rate-Solid Waste $18.32 $19.00 $19.59 $20.18 $20.79
32 gallon rate-Solid Waste $16.02 $16.61 $17.13 $17.65 $18.18
96 gallon rate-Yard Waste $14.90 $15.37 $15.85 $16.33 $16.82
96 gallon rate-2nd Yard Waste $7.40 $7.67 $7.91 $8.15 $8.40
Extra Can $4.23 $4.39 $4.52 $4.66 $4.80
Extra Bag $2.51 $2.60 $2.68 $2.76 $2.85
11/28/16 Council Presentation • Utility Rates-16
The following table details the proposed increase for container services for 2017. The increase is
3.7% over the current collection rates.
Current 2016 Rates Container Size
Col.Frequency 2 YD 4 YD 6 YD
1 $21.53 $34.28 $47.04
2 $34.54 $59.70 $85.56
3 $47.55 $85.12 $124.08
4 $60.56 $110.54 $162.60
5 $73.57 $135.96 $201.12
Proposed 2017 Rates Container Size
Col.Frequency 2 YD 4 YD 6 YD
1 $22.33 $35.55 $48.78
2 $35.82 $61.91 $88.73
3 $49.31 $88.27 $128.67
4 $62.80 $114.63 $168.62
5 $76.29 $140.99 $208.56
IMPACTS
1. Fiscal Impact-The proposed 2017 Yakima County landfill tipping fee will be an additional
yearly cost of$134,000 to the City. The remaining cost increase are comprised of labor and
operational costs of approximately$178,000. The overall fiscal impact to the Refuse Division
is$313,000. Projected cost increases in 2018 and 2019 are approximately$170,000 each year.
2. Proposed Funding Source-Refuse customers/Refuse operating fund. Rate increase of
3.7%for all refuse collection rates in 2017. Proposed rate increases in 2018 is 3.1% and an
increase of 3.0%in 2019 and in 2020.
3. Public Impact-This initiative will impact the public through a rate increase to cover the
increased cost of landfill disposal and other operational expenses.
4. Personnel Impact-None.
5. Required Changes in City Regulations or Policies-City ordinance revising the Refuse rate
schedule will be required.
6. Legal Constraints, if applicable-None.
7. Viable Alternatives-Rate increases at a different level.
11/28/16 Council Presentation • Utility Rates-17
TYPICAL HOUSEHOLD REVENUE INFORMATION
TYPICAL UTILITY BILL PAID
(Original Presentation)
Cost per billing cycle
2016 2017 2018 2019 2020
Water
2 month ready to serve $ 17.54 $ 19.03 $ 20.64 $ 20.64 $ 20.64
12 units - 17.52 19.05 20.88 20.88 20.88
35.06 38.08 41.52 41.52 41.52
Wastewater
2 month ready to serve 41.24 42.46 43.74 45.06 46.40
12 units - 36.12 37.20 38.28 39.48 40.68
77.36 79.66 82.02 84.54 87.08
Refuse
2 month 32 gallon cart 32.04 34.30 35.20 36.10 37.00
2 month 96 gallon cart 36.64 39.20 40.20 41.20 43.50
Stormwater
2 month ready to serve 7.16 11.68 11.96 12.26 12.56
Total Bi-monthly charge $156.22 $168.62 $175.70 $179.52 $184.66
Bi-monthly increase $ 12.40 $ 7.08 $ 3.82 $ 5.14
Total Monthly charge $ 78.11 $ 84.31 $ 87.85 $ 89.76 $ 92.33
Monthly Increase $ 6.20 $ 3.54 $ 1.91 $ 2.57
Assumptions:
Water&Wastewater-Average family usage of water per billing cycle 12
Stormwater -1 ERU,Equivalent Residential Unit of impervious surface
Refuse-96 gal.Cart
11/28/16 Council Presentation • Utility Rates-18
TYPICAL UTILITY BILL PAID
(Alternative #1)
Cost per billing cycle
2016 2017 2018 2019 2020
Water
2 month ready to serve $ 17.54 $ 18.42 $ 19.28 $ 20.15 $ 21.10
12 units - 17.52 18.40 19.26 20.13 21.07
35.06 36.82 38.54 40.28 42.17
Wastewater
2 month ready to serve 41.24 41.86 42.70 43.76 45.16
12 units - 36.12 36.66 37.40 38.33 39.56
77.36 78.52 80.10 82.09 84.72
Refuse
2 month 32 gallon cart 32.04 33.23 34.26 35.28 36.34
2 month 96 gallon cart 36.64 38.00 39.17 40.35 41.56
Stormwater
2 month ready to serve 7.16 9.09 10.82 12.12 12.60
Total Bi-monthly charge $156.22 $162.43 $168.63 $174.84 $181.05
Bi-monthly increase $ 6.21 $ 6.20 $ 6.21 $ 6.21
Total Monthly charge $ 78.11 $ 81.22 $ 84.32 $ 87.42 $ 90.53
Monthly Increase $ 3.11 $ 3.10 $ 3.11 $ 3.10
Assumptions:
Water&Wastewater-Average family usage of water per billing cycle 12
Stormwater -1 ERU,Equivalent Residential Unit of impervious surface
Refuse-96 gal.Cart
11/28/16 Council Presentation • Utility Rates-19
ALTERNATIVE #2
Submitted 11/16/16 by Scott Schafer
As we prepare for the November 28th Study Session and direction from City Council as to the
proposed rate increases, I strongly recommend that Refuse obtain the original rate increase of 7.0%
in 2017. The other utilities can get by with the lower alternative rate proposals. However, I do
remain concerned that the existing infrastructures for those utilities continue to be neglected as a
result of previous years of rate increase deferments. Identified capital improvement projects will be
addressed under the alternative proposed rates.
As discussed at the Roundtable discussions back in September, the City's original proposed rate
increases added up to an additional$6.20/month for a "Typical Household." City Council
requested looking at a total that was half that amount. This lead to an"alternative" rate
proposal. Below is both the original and alternative rate proposals for a Typical Household.
Original Alternative
Water-(12 Units) 8.5%=$1.51 5.0%=$0.88
Wastewater (12 Units) 3.0%=$1.15 1.5%=$0.58
Stormwater (1 ERU) 63.0%=$2.26 27.0%=$0.97
Refuse (96-gal) 7.0%=$1.28 3.7%=$0.68
Total Monthly Increase= $6.20 $3.11
To be able to implement a recycling program within the next three years, a full rate increase of 7.0%
will need to be approved for Refuse. Otherwise it will be years before we can address
recycling. Under a 7.0%increase, this will allow the beginning of a phased-in approach for
recycling as early as 2020 and can look at a bundled rate to include garbage, yard, and recycling at
that time. It will also allow the division to have an appropriate funding level in reserves
(12%). Below is Alternative #2. It contains the alternative rates for Water,Wastewater, and
Stormwater,but contains the original rate for Refuse. The "Typical Household" increases from
$3.11/month to$3.71/month.
Alternative#2
Water-(12 Units) 5.0%=$0.88
Wastewater (12 Units 1.5%=$0.58
Stormwater (1 ERU) 27.0%=$0.97
Refuse (96-gal) 7.0%=$1.28
Total Monthly Increase= $3.71
11/28/16 Council Presentation • Utility Rates-20
TYPICAL UTILITY BILL PAID
(Alternative #2-Submitted 11/16/16 by Scott Schafer)
Cost per billing cycle
2016 2017 2018 2019 2020
Water
2 month ready to serve $ 17.54 $ 18.42 $ 19.28 $ 20.15 $ 21.10
12 units - 17.52 18.40 19.26 20.13 21.07
35.06 36.82 38.54 40.28 42.17
Wastewater
2 month ready to serve 41.24 41.86 42.70 43.76 45.16
12 units - 36.12 36.66 37.40 38.33 39.56
77.36 78.52 80.10 82.09 84.72
Refuse
2 month 32 gallon cart 32.04 34.30 35.20 36.10 37.00
2 month 96 gallon cart 36.64 39.20 40.20 41.20 43.50
Stormwater
2 month ready to serve 7.16 9.09 10.82 12.12 12.60
Total Bi-monthly charge $156.22 $163.63 $169.66 $175.69 $182.99
Bi-monthly increase $ 7.41 $ 6.03 $ 6.03 $ 7.30
Total Monthly charge $ 78.11 $ 81.82 $ 84.83 $ 87.85 $ 91.50
Monthly Increase $ 3.71 $ 3.01 $ 3.02 $ 3.65
Assumptions:
Water&Wastewater-Average family usage of water per billing cycle 12
Stormwater -1 ERU,Equivalent Residential Unit of impervious surface
Refuse-96 gal.Cart
11/28/16 Council Presentation • Utility Rates-21