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R-2002-022 2001 Wastewater Cost of Service & Rate Study
1 - RESOLUTION NO. R-2002- 22 A RESOLUTION Adopting the 2001 Wastewater Cost of Service and Rate Study for the City of Yakima, Washington. WHEREAS, the City of Yakima is required to biannually review wastewater rates and charges to comply with federally mandates Environmental Protection Agency and State financing provisions, to satisfy bond covenants, and in accord with Yakima Municipal Code; and WHEREAS, a financing study is one element necessary to provide for the wastewater needs of the area for the health, safety and well being of the people, as well as complying with State and federal environmental laws and regulations; and WHEREAS, the City Council has complied with statutory requirements for Public Hearings on the findings of the Study; and BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The document entitled 2001 Wastewater Cost of Service and Rate Study, dated October 2001, a true copy of which Study is on file in the City Clerk's Office and is incorporated by reference herein, is hereby adopted by the City of Yakima. ADOPTED BY THE CITY COUNCIL this 5th day of March 2002 ATTEST: City Clerk BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 11 For Meeting Of March 5, 2002 ITEM TITLE: Request for Council Action on the 2000 Wastewater Facilities Plan and the 2001 Wastewater Cost of Service and Rate Study SUBMITTED BY: Dick Zais; City Manager Glenn Rice; Assistant City Manager Rita Anson; Finance Director Doug Mayo; Wastewater Manager CONTACT PERSON/TELEPHONE: Doug Mayo 575-6077 SUMMARY EXPLANATION: The Mandated Wastewater Facilities Plan was the subject of a Council Study Session in November 2000. A second study session was held January 15, 2002 on both the 2000 Mandated Wastewater Facilities Plan (Facilities Plan) and the 2001 Cost pf Service and Rate Study (COS). These Studies analyze the financial condition, needs, requirements, and mandates of the wastewater operating and capital funds and recommend actions and new wastewater rates to meet those conditions (continued) Resolution 2 Ordinance 1 Other (Specify) Contract Mail to (name and address). Phone Funding Source All wastewater custier classes APPROVED FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: Staff respectfully requests City Council to. 1) adopt, by resolution, the 2000 Wastewater Facilities Plan; and 2) adopt, by resolution, the 2001 Wastewater Cost of Service and rate Study; and 3) enact, by ordinance, the 2001 Wastewater Cost of Service recommendations as approved by Council. BOARD/COMMISSION RECOMMENDATION: COUNCIL ACTION: 2001 COS agenda 2/28/02 (Continued from front page) An open record Public Hearing on the 2000 Mandated Wastewater Facilities Plan and the 2001 Cost of Service and Rate Study was conducted on February 5, 2002. This Public Hearing was continued on February 19, 2002. After receiving Public Testimony, Council deliberated the recommendations of the 2001 Cost of Service and Rate Study and made appropriate amendments. These recommendations as amended included: • Pretreatment - Section 6 The COS recommended that approval be given to hire additional staff and purchase equipment, when needed, to perform the mandated duties as outlined in this section. This may include one permit writer and two field personnel. The COS would initiate a Fats, Oils, and Grease (FOG) reduction program as part of the pretreatment program as staff and equipment become available. This Ordinance establishes fees for sampling, testing and other related services as shown on Table 6-3 and 6-6 of the COS. These rates wni 1Irl be charged for required testing of Significant industrial Users (SIU's), requested testing and testing done for entities outside the City. However, businesses within the City limits would be charged only 75% shown for in-house services. The balance is included within the proposed City retail rate. The rates in the ordinance were set at 2002 levels and adjusted 3% for inflation for each subsequent year. The COS continues a cost to conduct the Minor Industrial User (MU) program as outlined Table 6-2 of the COS. Businesses within- the City limits would be charged only 75% of the full cost rate. The balance is included within the proposed City retail rate. The adopted rates adjustment for M1U's was: ri eu catmulit..../GL,LIVI 6County City (inriiirips 25% cost share) Current Rate: $35.70 $27.00 Proposed Rate: $60.00 $45.00 Increase % 68% 67% • Non -Owner Domestic Retail (County) - Section 7 The adopted rate adjustment was: Ready to Serve Volume/OUC Increase @ 10 UOC Existing: $16.01 $2.86 $44.61 Proposed Rate: $18.25 $3.26 $50.85 Increase %: 14% 14% 14% 2001 COS agenda 2/2R/02 • Non -Owner Retail Strong Waste - Section 8: Rates remained unchanged: BQD/Ib. (decrease) Existing: $0.502 • Septage Waste - Section 81 The adopted rate adjustment was: $/Gallon Septage Existing: $0.284 Proposed Rate: $0.316 Increase %: 11.27% TSS/Ib. (decrease) $0.493 Increase/1.000 Gallons $284.00 $316.00 $32.00 These adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. • Municipal Wholesale Customers - Section 9: No Council action required in this section. Rates are governed by a 4 -Party Agreement and subsequent written clarifications. • Food Processing Wastewater/Industrial Waste Customers - Section 10: This customer class no longer exists. Therefore, these rates are deleted from the ordinance. • City Strong Waste Retail Customers - Section 1 1 : The adopted rate adjustment was: BQD/Ib. (% increase) Existing: Phase 1(2002): Phase 2(2003): Phase 3(2004): Phase 4(2005): $0.230 $0.244 $0.259 $0.275 $0.293 6.1 % 6.1 % 6.2% 6.5% TSS/Ib. (%increase) $0.150 $0.178 18.7% $0.212 19.1% $0.252 18.9% $0.299 18.7% Council elected to implement this rate adjustment in four equal annual increases. When complete, these adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. • City Retail Customers — Section 12: The adopted rate adjustment was: Ready to Serve Volume/OUC Increase 010 UOC Existing: $ 8.33 $1.49 $23.23 * 2 for PWTF * $ s.50 $1 49 $23.40 Adopted Rate: $11.48 $2.01 $31.58 This Increase %: 35.1% 34.9% 35.0% * Total increase °lo:*:7.8% 34.9% 35.9% * By resolution R-2000-66, Council previously obligated a 2% increase in the Ready -to - Serve charge for debt service on a PWTF loan that assisted financing of Phase I of the Fruitvale Neighborhood Sewer -Water Project. The 2% increase is included in this adjustment. The proposed ordinance also includes some minor language adjustments for clarification and compatibility with other City ordinances. 2001 COS agenda 2%2$/02 CITY OF YAKIMA WASTEWATER UTILITY 2001. COST OF SERVICE AND RATE STUDY DRAFT SECTIONS 1 -THROUGH October, 2001 by Wastewater Staff CITY OF YAKIMA WASTEWATER DIVISION 2220 East Viola Yakima, Washington 98901 Phone: 575-6077 • Fax (509) 575-6116 NOTICE OF PUBLIC HEARING Wastewater Facilities Plan and Cost of Service and Rate Study Notice is hereby given that an open record public hearing will be held by the Yakima City Council to consider the adoption of the 2000 Wastewater Treatment Facilities Plan and the adoption of the 2001 Wastewater Cost of Service Rate Study. The Study analyzes the financial condition, needs, requirements, and mandates of the wastewater operating and capital funds and recommends actions and new wastewater rates to meet those conditions. The public hearing has been set for Tuesday, February 5, 2002, during the regularly scheduled City Council meeting beginning at 2:00 p.m., or as soon thereafter as the matter may be heard, in the Council Chambers of Yakima City Hall, 129 North Second Street, Yakima, Washington. Any person or persons desiring to express his/her view on this matter is invited to attend the open record public hearing and provide testimony or submit written comments to the Yakima City Council, 129 North 2nd Street, Yakima, WA 98901. A complete packet is available for public review at the City of Yakima, City Clerks Office, 129 N. 2nd Street, Yakima, WA, between 8:00 a.m. and 5:00 p.m. or the Wastewater Division, 2220 E. Viola Ave., Yakima, WA, between 8:30 a.m. and 4:30 p.m. weekdays. Further information regarding this application may be obtained by contacting Doug Mayo, Wastewater Manager, 575-6077. 1994 Public Information Summary January 24, 2002 To: Interested Citizens and Businesses of Yakima From: Dick Zais, City Manager Doug Mayo, Wastewater Manager Glenn Rice, Assistant City Manager Subject: Notice of Public Hearing for a discussion related to the Mandated Wastewater Facility Plan and the 2001 Wastewater Cost of Service and Rate Study Enclosed please find a Notice of Public Hearing. The purpose of this hearing is for the Yakima City Council to receive Public comment pertaining to the 2000 Mandated Wastewater Facilities Plan (Facilities Plan) and the 2001 Wastewater Cost of Service and Rate Study (COS). These Studies analyze the financial condition, needs, requirements, and mandates of the wastewater operating and capital funds and recommends actions and new wastewater rates to meet those conditions. In the COS, staff presents various options to achieve the required revenue. Other options have been added after preliminary meetings with Council and customers. Table 11-1 Revised presents three options (A, B, C) for a Strong Waste rate adjustment. Table 12-1 Revised presents five options (A, B, C, D, E) for an adjustment to City retail rates. The 2000 Mandated Wastewater Facilities Plan (Facilities Plan) identifies over $20.9 million of capital improvements required within the next 5 years to maintain our ability to serve the community. The Facilities Plan also identifies the need for additional staffing and support to meet NPDES Standards/requirements with an annualized cost of $1.13 million ($5.7 million over five years) The combination of the capital and operation needs identified in the Plan requires $26.6 million of new expenses to be added to our existing. program during the next five years. Of this. $22.4 million (84%) is due to the City's legal. mandated. and contractual obligations. The facilities plan also identifies the need for an additional $44.8 million of capital improvements during the years 2007-2012. and $19.2 million of capital improvements during the years 2013-2020. The total financial obligation over 2001 cos Public Info page 1 1/23/02 the next 19 years equals over S90 million in expenses, in addition to existing programs. for Wastewater Facility operations. The Wastewater Division's ability to meet the needs of the environment and community are facing a very expensive future. There will be grave consequences to the City's ability to meet regulatory demands and to accommodate growth if these challenges are not adequately met. The time to act is upon us. The choice of no action is not a viable option. This study makes recommendations to substantially adjust the current rate and fee schedules to accommodate the demands outlined in the Facilities Plan and satisfy the City's legal, mandated, and contractual obligations. An accompanying 2002 Update to the Wastewater Connection Charge Study is scheduled for your review mid -summer 2002. Any adjustment in those rates and charges will not have a noticeable effect on the rates in this report. REQUIREMENTS FOR SEWER RATE ADJUSTMENTS • As a prior recipient of Federal grant assistance. the City is required to; "Generate sufficient revenue to pay the total operation and maintenance costs necessary to the proper operation and maintenance (including replacement) of the treatment works." 40 CFR 35.929-2(b) (2). • "The user charge system must be designed to produce adequate revenues required for operation and maintenance (including replacement). It shall provide that each user which discharges pollutants that cause an increase_in the cost of managing the effluent or sludge from the treatment works smell pay for such increased cost." 40 CFR 35.2140, • Public law 92-500. Section 204 (b) (1) (A) states that the costs of operation and maintenance of a sewerage system must be recovered from sewer service charges that are proportional to costs of providing service. The City of Yakima is responsible for securing adequate collection, treatment, and administrative programs to meet wastewater obligations. In general, those obligations are public health, regulatory compliance, financing, and community growth. Today. there are no more Federal Grants. However. as a prior recipient 2001 cos Public Info page 2 1/23/02 of earlier Federal and State grants. the City remains bound to the terms of the Federal requirements cited above The City's financing choices are loans. bonds. or cash. All choices are entirely supported by wastewater customer rates. The Proposed Rates Increases are driven by: . • Mandates/Contractual Obligations: Federal and State laws, Regulatory Agencies, and Contractual Obligation of the City including obligations of the 4 -Party Agreement and maintaining debt coverage requirements on existing bonded debt. Federal NPDES Permit/Clean Water Act: Failure or delay to authorize the Plan and rate increase recommendations could lead to violations of the City's NPDES permit which could mean fines and other civil and criminal penalties against the City of Yakima and make the City vulnerable to third party lawsuits. Capacityz Without improvements, the capacity of the treatment facility and some of our trunk pipes will soon be exhausted. Service: Our ability to provide adequate, professional service to the community and to new customers of our area is diminishing annually. Declining Reserves: In spite of a drop in actual and budgeted expenditures, all Wastewater funds are experiencing declining reserves levels. By year-end 2002 Capital reserves will be below $2.0 million and the operating reserve will be below $1.4 million. These levels are well below minimum standards for operational needs. The reserves are declining at over $700,000 per year. This situation cannot be allowed to continue. If all new construction activity was halted, and NONE of the Facilities Plan recommendations were enacted the operating reserve would still fall to ZERO within two years. The Division is facing a $26.6 million shortfall over five years to meet the needs identified in the Facilities Plan. 2001 cos Public Info page 3 1/23/02 • Litigation: The Wastewater Division's litigation related to alleged odor complaints continues to expend substantial resources. There is NO money in this study for any potential damage award. Ongoing legal costs and any potential damage award would increase rates above those recommended by this study. CONCLUSION If the City does not take decisive action and obtain the resources necessary for the future, the following consequences could arise: • The capacity of the Treatment Facility and of several of our major interceptors will soon be exhausted. A Moratorium on new services (residential, commercial, and industrial) will likely be required within five years or less effectively stopping development; • The City's ability to remain in compliance with all elements of our Federal NPDES Permit would be in severe jeopardy; • The City would be unable to meet existing contractual agreements together with new obligations within our service area; and • The City could be unable to meet adequate debt coverage/bond covenant requirements. This could put the City's credit rating and ability to borrow money at risk. RATE RECOMMENDATIONS Staff evaluated several rate options that generate the required revenue. These options (phased increases) are included within the report in the applicable sections. The following recommendations of rate adjustments are provided to adjust current rate and fee schedules to generate a target revenue increase required to meet the 2006 funding requirements of the Wastewater Divisions existing programs and the 2000-2006 phase of the Updated 2000 Wastewater Facilities Plan ($26.6 million over 5 years). The recommendations for all customer classes are for a single rate adjustment in 2002. This option would allow some reserve capacity to transfer into the second phase 2006-2012 of the Facilities Plan capital requirements. 2001 cos Public Info page 4 1/23/02 • Pretreatment — Section 6 County Current Rate: $35.70 Proposed Rate: $60.00 Increase % 68% City (includes 25% cost share) $27.00 $45.00 67% Large percentage increase due to current undercount of customer base over which program cost is allocated. Proposed adjustments of Sampling and Testing Fees are listed in Section 6. • Non -Owner Domestic Retail (County) — Ready to Serve Existing: $16.01 Proposed Rate: $18.25 Increase %: 14% Section 7 Volume/Ot1C $2.86 $3.26 14% Increase a 10 D00 $44.61 $50.85 14% • Non -Owner Retail Strong Waste and Septage Waste — Section 8 BOD/lb. (decrease) TSS/Ib. (decrease) Existing: $0.502 $0.493 Proposed Rate: $0.412 $0.419 Increase %: -17.93% -15.01% Decrease is due to larger total quantity of BOD and TSS being treated. Existing: Proposed Rate: Increase %: $/Gallon Septage $0.284 $0.316 11 .27% Increase/1.000 Gallons $284.00 $316.00 $32.00 These adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. • Municipal Wholesale Customers — Section 9 No Council action required in this section. Rates are governed by a 4 - Party Agreement and subsequent written clarifications. • Food Processing Wastewater/Industrial Waste Customers — Section 10 This customer class no longer exists. 2001 COS Public Info page 5 1/23/02 • City Strong Waste Retail Customers — Section 11 j3OD/Ib. (increase) TSS/Ib. (increase) Existing: $0.230 $0.150 Proposed Rate: $0.293 $0.299 Increase %: 27.4% 99.3% These adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. Large increase in rate for TSS due to lack of adjustment in previous COS. Note that businesses have control over reducing these charges by good management practices to reduce loadings. • City Retail Customers — Section 12 Working on the hypothesis that the above outlined adjustments are substantially approved by City Council, the following adjustments to city retail customers are recommended. Ready to Serve Volume/OUC Increase 010 UO3 Existing: $ 8.33 $1.49 $23.23 * 2% for PWTF * $ 8.50 $1.49 $23.40 Proposed Rate: $11.48 $2.01 $31.58 This Increase %: 35.1% 34.9% 35.0% * Total increase % * 37.8% 34.9% 35.9% * By resolution R-2000-66, Council previously obligated a 2% increase in the Ready -to -Serve charge for debt service on a PWTF loan that assisted financing of Phase I of the Fruitvale Neighborhood Sewer -Water Project. The 2% increase is yet to be enacted. RECOMMENDATION Staff respectfully requests City Council review this study; adopt, by resolution, the 2001 Wastewater Cost of Service and Rate Study; and adopt the appropriate legislation enacting the rate and fee adjustments recommended in this study (or otherwise amended by Council action). 2001 COS Public Info page 6 1/23/02 Environmental Laws S1 1890 1880 1870 1900 1910 1920 1930 1950 1940 Year 1960 1970 1980 1990 2000 —140 120 100 -80 60 40 20 Number of Laws U.S. Federal Environmental Laws 110 100 90 80 70 60 I- 50 I 40 _I 30 I 20 _I 10 0 AMFA, ARPAA, AIA, ASBCAA, ESAA-AECA, FIFRAA, FEAPRA, IRA, NWPAA, COORA/NMSPAA, FCRPA, MMPAA APA, SWDA, CERCLA, CZMIA, COWLDA, FWLSCA, MPRSAA BLRA, ERDDAA, EAWA, NOPPA, PTSA, UMTRC, ESAA, QCA, NCPA CAAA, CWA, SMCRA, SDWA BLBA, FWPCA, MPRSA, CZMA, NCA, FEPCA, PWSA, MMPA NEPA, EQIA, CAA, EPA, EEA, OSHA, FAWRAA, NPAA NAWCA TA, FWCA, BPA NBRA IA WA AA YA WSRA, EA, RCFHSA FIFRA AEPA NLRA, WPA� \ \ AEA FWA WRPA, AFCA E9P, OPA, RECA, CAAA, GCRA, GLFWRA, -HMTUSA, NEEA WQA SDWAR, SARA RCRAA, WIDI MPRSAAA NWPA ARPA TSCA, FLPMA, RCRA, NEMA, CZMAA FRRRPA, SDWA, OPA NPS RHA PAA NHPA ESA,TAPA FHSA, NFMU WLDA FAWRA FWCAA 1872 1880 1890 1900 1910 1920 1930 1940 1950 1960 RE: G. Mason, Kitsap County, WA. Presentation at PNPCA, Boise, ID (Nov. 4, 1996) 1970 1980 1990 2000 0-6 year Priority Improvement Projects Capital and Staffing Improvements Opinion of Probable Cost Mandatory' Total %Total Mandatory Growth 2 Growth Regulations Renewal /Safety Subtotal Treatment Plant Improvements $13,811,200 $8,973,200 $3,371,000 89.4% $1,467,000 5.5% Subtotal Collection Facility $7,048,300 $2,548,700 $1,867,000 62.6% $2,632,600 9.9% Mandatory Staffing $5,700,000 $5,700,000 100.0% 0.0% TOTAL $26,559,500 $17,221,900 $5,238,000 84.6% $4,099,600 15.4% 1 Compliance with federal/state laws and regulations, and the Four Party Agreement 2 Non -mandatory growth /system expansion. Summary of Improvements TREATMENT / COLLECTION OPINION OF PROBABLE COSTS MANDATORY1 TOTAL %TOTAL MANDATORY GROWTH2 % GROWTH REGULATIONS RENEWAL / SAFETY Wastewater Treatment 0-6 Year Projects $ 13,811,200 $ 8,973,200 $ 3,371,000 89.4% $ 1,467,000 10.6% 7-l2 Year Projects $ 22,698,800 $ 15,251,200 $ 2,533,200 78.3% $ 4,914,400 21.7% 13-20 Year Projects $ 8,340,600 $ 2,079,300 $ 1,713,500 45.5% $ 4,547,800 54.5% Total Treatment Plant Improvements $ 44,850,600 $ 26,303,700 $ 7,617,700 75.6% $ 10,929,200 24.4% Collection Faciltiy 0-6 Year Projects $ 7,048,300 $ 2,548,700 $ 1,867,000 62.6% $ 2,632,600 37.4% 7-12 Year Projects $ 22,191,500 $ 8,681,200 $ - 39.1% $ 13,510,300 60.9% 13-20 Year Projects $ 10,844,700 $ 3,253,400 $ - 30.0% $ 7,591,300 70.0% Total Collection Facility Improvements $ 40,084,500 $ 14,483,300 $ 1,867,000 40.8% $ 23,734,200 59.2% Total Treatment / Collection $ 84,935,100 $ 40,787,000 $ 9,484,700 59.2% $ 34,663,400 40.8% Mandatory compliance with federal/state laws and regulations, and the Four Party Agreeement, Non-mandoratory growth/systemexpansion receives a _ 2 Non -mandatory growth/system expansion _ _ 3 For the 0-6 Year period, a total of $20,859,500 is required. $16,759,900 or 80.3% percent, is required to meet mandatory obligations. $4,099,600 or 19.7%, is 7-12 year Priority Improvement Projects Capital Expense Improvements Opinion of Probable Cost Mandatory) Total % Mandatory 2 Growth Total Growth Regulations Renewal /Safety Subtotal Treatment Plant Improvements $22,698,800 $15,251,200 $2,533,200 78.3% $4,914,400 21.7% Subtotal Collection Facility $22,191,500 $8,681,200 39.1% $13,510,300 60.9% TOTAL TREATMENT/COLLECTION $44,890,300 $23,932,400 $2,533,200 59.0%_ $18,424,700 41.0% 1 Compliance with federal/state laws and regulations, and the Four Party Agreement 2 Non -mandatory growth /system expansion. 13-20 year Priority Improvement Projects Capital Expenses Improvements Opinion of Probable Cost Mandatory) Total %Total Mandatory Growth Z % Growth Regulations Renewal /Safety Subtotal Treatment Plant Improvements $8,340,600 $2,079,300 $1,713,500 45.5% $4,547,800 54.5% Subtotal Collection Facility $10,844,700 $3,253,400 30.0% $7,591,300 70.0% _ TOTAL TREATMENT/COLLECTION $19,185,300 $5,332,700 $1,713,500 36.7% $12,139,100 63.3% 1 Compliance with federal/state laws and regulations, and 2 Non -mandatory growth /system expansion. the Four Party Agreement 0-6 year Priority Improvement Projects Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Growth z Regulations Renewal /Safety Emergency Generator FWWTP-2 overhaul/replacement $100,000 $100,000 Primary Clarifier Collection FW WTP-3 Mechanisms (2 of 4) $200,000 $200,000 Primary Sludge Pumping Lighting FWWTP-4B Replacement $10,000 $10,000 FWWTP-7A Trickling Filter Door/Walkway Covers $85,000 $85,000 _ FW WTP-7B Trickling filter Mechanism (Both) $650,000 $325,000 _ $325,000 _ FWWTP-8A Repair Existing Aeration Basin $181,000 $181,000 FWWTP-8B Replace Blower VFD's (2 of 4) $245,000 $245,000 _ _-� - FWWTP-8C Aeration Basin Diffusers Rehab $50,000 $50,000 _ _ _ _ ____ Refurbish Secondary Clarifier Bull- FWWTP-9A Gears $120,000 $120,000 Replace Secondar Clarifier Exterior FWWTP-9B Launders $257,000 $257,000 Replace Secondary Clarifier Skimmer FWWTP-9C Mechanism/Scum Box $362,000 $362,000 _ Refurbish DAFT Air FWWTP-10Compressor/Pipelines $267,000 $267,000 _ Trickling. Clarifier Solids FWWTP-7D Removal System /Dewatering $425,000 $425,000 FWWTP-7D Trickling Filter Clarifier Gates $50,000 $50,000 Trickling Filter Effluent Pumping Station $652,000 $652,000 Secondary Clarifier Spray Nozzle installation $15,000 $15,000 FWWTP-14 Secondary Clarifier Evaluation $50,000 $50,000 FWWTP-15 Miscellaneous Improvements $200,000 $200,000 WWTP-2 Grit Storage Hopper $100,000 $100,000 - WWTP-5 .. New RAS/WAS Pumping Station - $1,669,400 $1,669,400 - -. _. -_.$1 W WTP-11 B New Centrifuge '$1,345 000 345,000 WWTP New Secondary Clarifier $3,277,800 $3,277,800 WWTP 18 _Truck Storage $400,000 $400,000 WWTP-16 Biosolids Handling ------ $3,100,000 $3,100,000 Collection Model/Monitoring Section 22 $240,000 $240,000 Collection Facifty Table 11-11 $694,000 $694,000 Collection Facilely Table 11-13 r£ 11-15 $2,489,300 - $1,173,000 $1,316,300 Collection Facility Table 11-14 (20%)3 $3,625,000 $3,625,000 $1,316,300 1 Compliance with federal/state laws and regulations, and the Four Party Agreement - 2 Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth I i -- - 1. 7-12 year Priority Improvement Projects Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Growth2 Regulations Renewal /Safety 1,WWTP- I Influent Building $50,0(X) $50,000 Primary Clarifier Collection FWWTP-3 Mechansims (2 of 4) $200,000 $200,000 Sludge Transfer 13uilding FWWTP-5 Refurbishment $100,000 $100,000 FWWTP 6 Replace Intermediate Grit Box Center Wall $250,000 $250,000 Replace Blower VFD's (2 I WWTP-8B of 4) $245,((X) $245,00( Install Secondary lligestcr FWWTP-11B Gas Flare $60,000 $60,(XX) Miscellaneous 1 7 W W TP -15 Improvements $400,00) $200,000 $200,000 W WTP-2 Grit Storage Hopper $212,1(X) $212,100 W WTP-7C Additional Blower $547,800 $547,800 Trickling filter Forced WWTP-4B Ventilation $1,066,100 $1,066,100 WWTP-7A Anoxic Selector Cells $2,480,000 $2,480,0.00 _ WWTP-7B Aeration Basin (2.1 mg) $4,366,600 $4,366,60.0 WWTP-8 UV Disinfection _ $3,931,100 $3,9-31,100 * WWTP-9 WAS Thickening $1,338,6(X) $ 1,338,600 WWTP-10 Centrate Pretreatment $1,912,700 $1,912,700 * WWTP-11A Solids Building $3,412,600 $3,412,600 _ WWTP-11C Polymer System $976,200 $976,200 - WWTP-12 Laboratory Modifications $1,000,000 $1,000,000 WWTP-14 New Boiler/hot water $150,000 $150,000 _* * Collection Facility Table 11-15 _ __ $6,291,700 $2,282,400 $4,009,300_ Maintenance Bldg Section 11 $3,257,600 $2,606,100 $651,500 Collection Facility Table 11-14 $12,642,200 $3,792,700 $8,849,500 * Indicates benefits to Growth related issues. 1 Compliance with federaVstate laws and regulations, and the Four Party Agreement - 2 Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth 13-20 year Priority Improvement Projects Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Growth2 Regulations Renewal /Safety FWWTP-1 lA FWWTP-15 PrimarFWWTP-4A' Sludge Pumping Density and Flow Meters Add Secondary Digester Recirculation Pumps Miscellaneous Improvements $240,000 $203,000 $400,000 _ $2,079,300 $240,000 $203,000 $400,000 $870,500 WWTP-1 WWTP-3 WWTP-7C WWTP-15 Septage Receiving Facility Primary Split Box Additional Blower - 2nd $2,079,300 $870,500 $547,800 $4,000,000 $547,800 Mesophilic Digestion $4,000,000 Collection Facility Table 11-14 (40%f $10,844,700 $3,253,400 $7,591,300 * Indicates benefits 1 Compliance with 2 Non -mandatory 3 30% Mandatory, to Growth related issues and the Four Party i federal/state laws and regulations, growth /system expansion. Agreement 1 70% Growth Table 11-1 Revised City Retail Strong Waste Proposed Rate Adjustment Eliminate Cost Share Projected Annual Revenue 1/23/02 OPTION A ONE TIME INCREASE BOD % TSS % Existing $0.230 increase $0150 increase Phase One $0.293 27.4% $0.299 99.3% Projected Projected Projected Projected Revenue Revenue Revenue % Revenue Existing Rates Full Cost Increase Increase Table 11-3 Table 11-2A 2001 $453,621 $453,621 $0 2002 $458,157 $640,138 $181,981 39.7% 2003 $462,739 $646,540 $183,801 39.7% 2004 $467,366 $653,005 $185,639 39.7% 2005 $472,040 $659,535 $187,495 39.7% 2006 $476,760 $666,130 $189,370 39.7% Total $928,286 OPTION B PHASED INCREASE (2 year) BOD % Combined TSS % Combined Existing $0.230 increase increase $0 150 increase increase Phase One $0.293 27.4% $0.225 50.0% Phase Two $0.293 0.0% 27.4% $0.299 32.9% 99.3% Projected Projected Projected Projected Revenue Revenue Revenue % Revenue Existing Rates Full Cost Increase Increase Table 11-3 Table 11-2B 2001 $453,621 $453,621 $0 2002 $458,157 $599,753 $141,596 30.9% 2003 $462,739 $646,540 $183,801 39.7% 2004 $467,366 $653,005 $185,639 39.7% 2005 $472,040 $659,535 $187,495 39 7% 2006 $476,760 $666130 $189,370 39.7% Total $887,901 OPTION C PHASED INCREASE (4 year) BOD % Combined TSS % Combined Existing $0 230 increase increase $0.150 increase increase Phase One $0.244 6.1V. $0.178 18.7% Phase Two $0.259 6.1% 12.6% $0.212 19.1% 41.3% Phase Three $0.275 6.2% 19.6% $0.252 18.9% 68.0% Phase Four $0.293 6.5% 27.4% $0.299 18.7% 99.3% Projected Projected Projected Projected Revenue Revenue Revenue % Revenue Existing Rates Full Cost Increase Increase Table 11-3 Table 11-2C 2001 $453,621 $453,621 $0 2002 $458,157 $495,922 $37,765 8.2% 2003 $462,739 $543,863 $81,124 17 5% 2004 $467,366 $597,601 $130,235 27 9% 2005 $472,040 $659,535 $187,495 39.7% 2006 $476,760 $666,130 $189,370 39.7% Total $625,989 1/23/02 Table 12-1 Revised City Wastewater Retail Customer Protected Revenue/Requirement 1/23/02 Projected Projected Revenue % % x Revenue Requirement Shortfall Shortfall Increase 2000 survey CURRENT RATES Monthly State Table 12-3 Table 12-4 Rate Ranking Year Projected Revenue Requirement 10 UOC of 201 2001 56,935,627 $7,066,023 4130,396) -1.88% $23.23 127 2002 $7,562,622 $8,621,420 ($1,058,798) -14.00% 2003 $7.587,434 $8,606,315 ($1,018,881) -13.43% 2004 $7,612,280 59,521,340 (51,909,060) -25.08% 2005 57,637,257 $10,276,870 (52,639,613) -34.56% 2006 $7,662,269 $10,468,209 ($2,805,940) -36.62% 2002-2006 ($9,432,292) OPTION A (All Options include the 2% Increase for the PWTF loan) 2000 survey One Tina 35% Monthly State Table 12-2A Table 12-4 Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 ($130,396) -1.88% 523.23 127 2002 $10,270,609 $8,621,420 $1,649,189 16.06% 35.00% $31.58 58 2003 $10,304,424 58,606,315 51,698,109 16.48% $31.58 58 2004 $10,338,285 $9,521,340 5816,945 7.90% 531.58 58 2005 $10,372,327 510,276,870 595,457 0.92% 531.58 58 2006 $10,406,414 $10,468,209 ($61,795) -0.59% $31.58 58 2002-2006 $4,197,905 effective Increase 35.9% OPTION B (All Options include the 2% increase for the PWTF loan) 2000 survey 3 even Steps of 10 5% Monthly State Table 12-2C Table 12-4 (includes cons'deration of SW Op ion A increase) Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 4130,396) -1.88% $23.23 127 2002 58,421,516 58.621,420 4199,904) -2.37% 10.50% 525.89 106 2003 59,326,161 $8,606,315 $719,846 7.72% 10.50% $28.58 85 2004 $10,335,429 $9,521,340 5814,089 7.88% 10.50% 531.57 58 2005 $10,369,456 $10,276,870 592,586 0.89% 531.57 58 2006 510,403,529 $10,468,209 ($64,680) -0.62% 531.57 58 2002-2006 51,361,937 effective increase 35.9% OPTION C (All Options include the 2% increase for the PWTF loan) 2000 survey 1 Step of 17.5% then 4 of 3.5% Monthly State Table 12-2C Table 12-4 (includes cons'deration of SW Op ion A increase) Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 56,935,627 $7,066,023 4130,396) -1.88% $23.23 127 2002 58.940,652 58,621,420 5319,232 3.57% 17.50% 527.49 93 2003 $9,279,759 58,606,315 $673,444 7.26% 3.50% 528.44 87 2004 59,623,804 59,521,340 $102,464 1.06% 3.50% $29.40 79 2005 $10,008,174 $10,276,870 (5268,696) -2.68% 3.50% $30.47 70 2006 510,400,645 $10,468,209 ($67,564) -0.65% 3.50% $31.56 58 2002-2006 5758,880 effective increase 35.9% 5 OPTION D even steps of 6.2% (All Options include the 2% increase � for the PWTF loan) Monthly 2000 survey_ State Table 12-2D Table 12-4 (includes consideration of SW Op ion A increase) Rate Ranking Projected Revenue Requirement 10 UGC of 201 2001 $6,935,627 $7,066,023 ($130,396) -1.88% $23.23 127 2002 $8,075,088 $8,621,420 ($546,332) -6.77% 6.20% $24.83 119 2003 58.611,168 $8,606,315 $4,853 0.06% 6.20% 526.39 102 2004 $9,159,191 $9,521,340 4362,149) -3.95% 6.20% 527.98 90 2005 $9,757,496 $10,276,870 ($519,374) -5.32% 6.20% 529.71 78 2006 $10,406,414 $10,468,209 461,795) -0.59% 6.20% $31.58 58 2002-2006 ($1,484,797) effective increase 35.9% OPTION E (All Options include the 2% increase for the PWTF loan) 2000 survey 4 even steps of 8.0% Monthly State Table 12-2E Table 12-4 (includes cons'deratton of 4 year SW phased increase Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 57,066,023 ($130,396) -1.88% $23.23 127 2002 58,222,346 $8,765,636 ($543,290) -6.61% 8.00% $25.28 111 2003 $8,912,316 58,708,992 5203,324 2.28% 8.00% 527.31 93 2004 59,658,926 59,576,744 582,182 0.85% 8.00% 529.50 78 2005 510,465,709 510,276,870 5188,839 1.80% 8.00% 531.86 58 2006 $10,500,087 510,468,209 $31,878 0.30% $31.86 58 2002-2006 ($37.067) effective increase 37.2% 1/23/02 Statewide Comparison Monthly Single Family Wastewater Rates Results of a survey of Washington Wastewater Agencies with over 10,000 customers. Rates are for 2002. YAKIMA County (existing) YAKIMA County (proposed) Single Family 1,000 cf Rank of Residential 3/4" meter (17) Customers $44.61 $50.85 2002 9 ,522:' Alderwood $26.78 ( 5) 17,900 Bellingham $24.25 ( 3) 16,442 Edmonds $23.85 ( 2) 10,549 Hazel Dell (Vancover) $31.82 (10) 15,670 Kennewick $33.29 (13) 10,177 Lakehaven (Federal Way) $26.48 ( 4) 18,988 Lakewood (S. Tacoma) $19.45 ( 1) 11,446 Longview $26.97 ( 6) 11,263 Marysville $40.00 (16) 10,141 Northshore (N. Seattle) $32.95 (12) 16,436 Olympia $36.41 (14) 10,431 Richland $30.70 ( 8) 14,164 Seattle $56.59 (17) 140,812 Shoreline $30.33 ( 7) 10,147 Soos Creek (Kent) $38.20 (15) 21,235 Tacoma $32.05 (11) 76.507 Average $31.88 2001 COS Section 1 Page 12 rev. January 23, 2002 CITY OF YAKIMA WASTEWATER UTILITY 2001 COST OF SERVICE AND RATE STUDY DRAFT SECTIONS 1 THROUGH 12 October, 2001 by Wastewater Staff SECTION 1 SECTION 2 SECTION 3 SECTION 4 SECTION 5 SECTION 6 SECTION 7 SECTION 8 SECTION 9 SECTION 10 SECTION 11 SECTION 12 2001 WASTEWATER UTILITY COST OF SERVICE AND RATE STUDY TABLE OF CONTENTS Transmittal Introduction and Executive Summary Background Information Capital Improvement Program Operation, Capital, and Debt Service Plant Flows and Pollutant Loading Pretreatment Program Outside City Domestic Retail Customers Outside City Strong Waste / Septic Customers Municipal Wholesale Customers Industrial Waste Customers City Strong Waste Customers City Retail Domestic Customers TRANSMITTAL October 12, 2001 To: Honorable Mayor, Members of the City Council From: Dick Zais, City Manager Doug Mayo, Wastewater Manager Glenn Rice, Assistant City Manager Subject: Transmittal of Mandated 2001 Wastewater Cost of Service and Rate Study OPENING This memorandum transmits the accompanying 2001 Wastewater Cost of Service and Rate Study (COS). This Study is presented for your review, deliberation, and action. It analyzes the financial condition, needs, requirements, and mandates of the wastewater operating and capital funds and recommends actions and new wastewater rates to meet those conditions. During a Study session last November, Council was introduced to the 2000 Mandated Wastewater Facilities Plan (Facilities Plan). This plan identifies over 1 • Al • ••i • .•. . •u• • -u-• -• ' • , I I 1- I-. -. • maintain our ability to serve the community. The Facilities Plan also identifies the need for additional staffing and support to meet NPDES Standards/requirements with an annualized cost of $1.13 million ($5.7 million over five years) (Please see enclosed tables, 1-8, 1-9, 1-10, and 1-12 from the Facilities Plan). The combination of the capital and operation needs identified in the Plan requires $26.6 million of new expenses to be added to our existing program during the next five years. Of this. $22.4 million (84%) is due to the City's legal. mandated. and contractual obligations. The facilities plan also identifies the need for an additional $44.8 million of capital improvements during the years 2007-2012. and $19.2 million of capital improvements during the years 2013-2020. (Please see enclosed tables, 1-13, 1-14, and 1-15 from the Facilities Plan). The total financial obligation over the next 19 years equals over $90 million in expenses. in addition to existing programs. for Wastewater Facility operations. The Wastewater Division's ability to meet the needs of the environment and community are facing a very expensive future. There will be grave consequences to the City's ability to meet regulatory demands and to 2001 cos Transmittal page 1 1 0/1 2/01 accommodate growth if these chatlenaes are not adequately met. The time to act is upon us_ The choice of no action is not a viable option. This study makes recommendations to substantially adjust the current rate and fee schedules to accommodate the demands outlined in the Facilities Plan and satisfy the City's legal, mandated, and contractual obligations. An accompanying 2002 Update to the Wastewater Connection Charge Study is scheduled for your review mid -summer 2002. Any adjustment in those rates and charges will not have a noticeable effect on the rates in this report. REQUIREMENTS FOR SEWER RATE ADJUSTMENTS • As a prior reciaient of Federal grant assistance. the City is required to: "Generate sufficient revenue to oav the total operation and maintenance s n -s _r . h .r .. -r ..-r< i•n .n.' min -n>n -- "in 1 ..in replacement) of the treatment works." 40 CFR 35.929-2(b) (2), • 'The user charge system must be designed to produce adequate revenj§ required for operation and maintenance (including replacement). It shall provide that each user which discharges pollutants that cause an increase_in the cost of managing the effluent or sludge from the treatment works shall pay for such increased cost." 40 CFR 35.2140. The City of Yakima is responsible for securing adequate collection, treatment, and administrative programs to meet wastewater obligations. In general, those obligations are public health, regulatory compliance, financing, and community growth. Today there are no more Federal Grants. However. as a prior recipient of earlier Federal and State grants. the City remains bound to the terms of the Federal requirements cited above. The City's financing choices are loans. bonds, or cash. All choices are entirely supported by wastewater customer rates. 2001 cos Transmittal page 2 10/12/01 The Proposed Rates Increases are driven by: • Mandates/Contractual Obligations; Federal and State laws, Regulatory Agencies, and Contractual Obligation of the City including obligations of the 4 -Party Agreement and maintaining debt coverage requirements on existing bonded debt. (See Appendix I for Regulations, Rules and Citations.) Federal NPDES Permit/Clean Water Act: Failure or delay to authorize the Plan and rate increase recommendations could lead to violations of the City's NPDES permit which could mean fines and other civil and criminal penalties against the City of Yakima and make the City vulnerable to third party lawsuits. (See Appendix I for existing NPDES permit.) • Capacityz Without improvements, the capacity of the treatment facility and some of our trunk pipes will soon be exhausted. • Service: Our ability to provide adequate, professional service to the community and to new customers of our area is diminishing annually. • Declining Reserves: In spite of a drop in actual and budgeted expenditures, all Wastewater funds are experiencing declining reserves levels. By year-end 2002 Capital reserves will be below $2.0 million and the operating reserve will be below $1.4 million. These levels are well below minimum standards for operational needs. The reserves are declining at over $700,000 per year. This situation cannot be allowed to continue. If all new construction activity was halted, and NONE of the Facilities Plan recommendations were enacted the operating reserve would still fall to ZERO within two years. The Division is facing a S26.6 million shortfall over five years to meet the needs identified in the Facilities Plan. • Litigation: The Wastewater Division's litigation related to alleged odor complaints continues to expend substantial resources. There is NO money in this study for any potential damage award. Ongoing 2001 cos Transmittal page 3 10/12/01 legal costs and any potential damage award would increase rates above those recommended by this study. CONCLUSION If the City does not take decisive action and obtain the resources necessary for the future, the following consequences could arise: • The capacity of the Treatment Facility and of several of our major interceptors will soon be exhausted. A Moratorium on new services (residential, commercial, and industrial) will likely be required within five years or less effectively stopping development; .• • `11- 1 1 •11• -1 - A 1 . - '11-1 Federal NPDES Permit would be in severe jeopardy; • The City would be unable to meet existing contractual agreements together with new obligations within our service area; and • The City could be unable to meet acies4sate debt coverage bond • -1..1 -• -11-1 1 • • •_ __ 1" -• . 1• -1• ability to borrow money at risk. RATE RECOMMENDATIONS Staff evaluated several rate options that generate the required revenue. These options (phased increases) are included within the report in the applicable sections. The following recommendations of rate adjustments are provided to adjust current rate and fee schedules to generate a target revenue increase required to meet the 2006 funding requirements of the Wastewater Divisions existing programs and the 2000-2006 phase of the Updated 2000 Wastewater Facilities Plan ($26.6 million over 5 years). The recommendations for all customer classes are for a single rate adjustment in 2002. This option would allow some reserve capacity to transfer into the second phase 2006-2012 of the Facilities Plan capital requirements. 2001 cos Transmittal page 4 10/12/01 • Pretreatment — Section 6 County Current Rate: $35.70 Proposed Rate: $60.00 Increase % 68% City (includes 25% cost share) $27.00 $45.00 67% Large percentage increase due to current undercount of customer base over which program cost is allocated. Proposed adjustments of Sampling and Testing Fees are listed in Section 6. • Non -Owner Domestic Existing: Proposed Rate: Increase %: Retail (County) Ready to Serve $16.01 $18.25 14% — Section 7 Volume/OUC $2.86 $3.26 14% Increase a 10 uO $44.61 $50.85 14% • Non -Owner Retail Strong Waste and Septage Waste — Section 8 $OD/Ib. (decrease) TSS/Ib. (decreasel Existing: $0.502 $0.493 Proposed Rate: $0.412 $0.419 Increase %: -17.93% -15.01% Decrease is due to larger total quantity of BOD and TSS being treated. $/Gallon Septage Increase/1.000 Gallons Existing: $0.284 $284.00 Proposed Rate: $0.316 $316.00 Increase %: 11.27% $32.00 These adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. • Municipal Wholesale Customers — Section 9 No Council action required in this section. Rates are governed by a 4 - Party Agreement and subsequent written clarifications. • Food Processing Wastewater/Industrial Waste Customers — Section 10 This customer class no longer exists. 2001 COS Transmittal page 5 10/1 2/01 • City Strong Waste Retail Customers — Section 11 BOD/lb. (increase) TSS/Ib. (increase) Existing: $0.230 $0.150 Proposed Rate: $0.293 $0.299 Increase %: 27.0% 100.0% These adjustments create a "full cost" rate with no direct subsidy by city retail ratepayers. Large increase in rate for TSS due to lack of adjustment in previous COS. Note that businesses have control over reducing these charges by good management practices to reduce loadings. • City Retail Customers — Section 12 Working on the hypothesis that the above outlined adjustments are substantially approved by City Council, the following adjustments to city retail customers are recommended. Ready to Serve Volume/OUC Increase 010 DOC Existing: $ Svl.qR $1.4Q $2��q .2 t * 2% for PWTF* $ 8.50 $1.49 $23.40 Proposed Rate: $11.48 $2.01 $31.58 This Increase %: 35.1% 34.9% 35.0% * Total increase °* 37.8% 34. ° 35.9% * By resolution R-2000-66, Council previously obligated a 2% increase in the Ready -to -Serve charge for debt service on a PWTF loan that assisted financing of Phase 1 of the Fruitvale Neighborhood Sewer -Water Project. The 2% increase is yet to be enacted. RECOMMENDATION Stall respectfully requests City Council review this study; adopt, by resolution, the 2001 Wastewater Cost of Service ands Rate Study; and adopt the appropriate legislation enacting the late and fee adjustments recommended in this study (or otherwise amended by Council action). 2001 COS Transmittal page 6 10/1 2/01 DRAFT Table 1-7. Mandatory Yakima Regional WWTP Program Staffing O&M1 Category Staffing/Equipment Annual Cost $375,000 $225,000 $1,650,000 $750,000 $600,000 $225,000 $420,000 $100,000 $1.592,000 $5,937,000 Program Administration Engineering Support Facility Operations/Biosolids Facility Maintenance Facility Laboratory Food processing Power/Water/Refuse/Chemicals Machinery/Equipment City Services/Ancillar Costs'` y Total WWTP Staffing/Program 'Includes WWTP, Rudkin Road, Food Processing, and Laboratory. 2Customer services, administrative overhead, state and Local fees, debt service, and other charges. 5 people/equipment 3 people/equipment 22 people/equipment 10 people/equipment 8 people/equipment 3 people/equipment The City of Yakima is mandated by WDOE through the NPDES permitting process to accept responsibility for a fully delegated Pretreatment Program by July 2002. Over 125 permits will be required for existing institutional, commercial, and industrial facilities now located within the City's service area. In addition to preparing the permits, reporting, and on-site inspections of each of the permitted facilities, the City will also be responsible for sampling and testing each Significant Industrial Users discharge to the collection system at least twice per year. The activities required for the fully delegated Pretreatment Program are in addition to those responsibilities currently being performed by City staff under the Strong Waste program. Table 1-8 identifies the expected mandatory program staffing and costs for the combined Pretreatment Program and Strong Waste Program. The initial program will require a minimum of 9 full-time equivalent positions, to as many as 14 full-time equivalent positions, to meet the requirements of the combined programs. Table 1-8. City of Yakima Mandatory Pretreatment/Strong Waste Program Cost Category Salary/Benefits Operations City Services/Ancillary Costs Amortized Equipment Cost Annual Cost4 $675,000 $25,000' $140,0002 $50,000' Annual Cost' $1,050,000 $40,0001 $218,0002 $78,0003 Total $890,000 $1,386,000 1. Includes general office supplies, printing, postage, and annual public notices. 2. Customer services, administrative overhead, state and local fees. and other charges. 3. Vehicle expense, computers, and sampling equipment (5 -year replacement). 4 9 FIB. s. (anticipated minimum staffing level in 2002) 5. 141F-i'bs. (anticipated maximum staffing level in 2002) Additional laboratory space and staffing will be needed to meet the requirements of the fully delegated Mandatory Pretreatment Program, and the increased requirements for sampling and testing set forth in the NPDES permit. Other mandatory new programs which may impact both laboratory space and staffing include handling of industrial septage at the Yakima Regional WWTP, and the implementation of a Storm Water HDR ENGINEERING, INC. CITY OF YAKIMA SUMMARY - OCTOBER 25, 2000 PAGE 15 DRAFT Management Program within the City of Yakima. Table 1-9 summarizes the staffing and laboratory space requirements for these mandatory added programs. Table 1-9. City of Yakima Mandatory Laboratory Staffing Increase and Laboratory Upgrades Category Fully Delegated Pretreatment4 Industrial Septage3 NPDES Permit' Total Operations Personnel (FTE) 1.5 3.0 0.5 5.0 Personnel (Dollars) $112,500 $225,000 $37,500 $375,000 E•ti. .ment/Chernicals $25,000 $35,000 $10,000 $70.000 Total Annual Cost $137,500 $260,000 $47,500 $445,000 Capital Laboratory $250,000 $200,000 $450,000 $800,0002 Expansion/Equipment 1. Mandatory under current NPDES permit. 2. Laboratory Expansion/Equipment Capital Costs of $800,000 includes fully delegated pretreatment program. increased requirements of NPDES, and Industrial Septage program. With Storm Water Management, the laboratory Expansion/Equipment Costs increase to $1,000,000. Storm Water will be Mandatory by 2003. 3 Based on one hundred 1,000 gallon septage loads per month with testing for BOD, TSS, pH, metals, and petroleum hydrocarbons. May not be considered Mandatory until 2005 or beyond. 4 Mandatory in 2002. The current recommendation is to include the total cost of $1,000,000 for laboratory expansion in the financial planning for the Yakima Regional WWTP. The decision on selection of a preferred laboratory expansion would be postponed until the next update of the Wastewater Facilities Plan. 1.7 Aeration Basin Structural Evaluation Failing concrete within Aeration Basin No. 4 prompted a field structural evaluation to investigate the basin floor/foundation concrete and subsurface conditions, with the intent to determine the cause of the concrete failures. The field evaluation determined that the observed cracks and voids within the basin concrete, at localized areas along the basin north wall, are most likely caused by defects in the mixing and placing of the original concrete wall footing. No significant signs of subgrade instability beneath either the existing wall footings or the floor slab were observed. The recommended repairs for the Aeration Basins included removal and replacement of all deteriorated concrete, adding saw -cut expansion and contraction joints, and epoxy coating of all basin walls. The opinion of probable cost for the Aeration Basin repairs (including all 4 basins) is $675,000. This project has been listed as a key features project in this report. 1.8 Gas Utilization and Cogeneration An evaluation of current and future methane gas production was performed in Section 8. new boiler, fuel oil with digester backup, A new operating vi, ,u�., gas as a waS ICG'Ummended. Cogeneration was determined to be not cost-effective based on current cost of electricity, HDR ENGINEERING, INC. CITY OF YAKIMA SUMMARY - OCTOBER 25, 2000 PAGE 16 DRAFT 1.9.7 Resource Requirements The level of effort required to properly administer the mandatory biosolids management activities is extensive. Most, if not all, of the treatment plant on-site activities are part of what is normally considered plant operations tasks. As the plant grows in size and new processes are added, trained staff will be needed to maintain adequate operation of the system. Assessment of operating staff size should be a regular part of planning and budgeting. Depending on the range of options chosen, a staffing analysis should be performed in conjunction with the design of these improvements. 1.10 Analysis of Existing Wastewater Collection Facilities Section 10 identifies the existing lift stations, pumping station, forcemains, and sanitary sewer conveyance facilities for the City of Yakima sanitary sewer system. The infiltration and inflow into the system; the current program for sewer system rehabilitation; and safety, reliability, and efficiency issues are presented. The evaluation of infiltration and inflow into the City of Yakima sewerage system conducted for this Wastewater Facilities Plan concluded that these extraneous flows generally comply with the Environmental Protection Agency cnteria for determination as non -excessive. During the spring and summer 2000, an increase in wastewater flow over the previous 3 -years of record was observed at the Yakima Regional WWTP. Upon investigation by City staff, extraneous flow was found to be entering the sewerage system from individual side laterals. The City's current program of systematically identifying sources of infiltration and inflow and incorporating rehabilitation of the collection system into the annual operation and maintenance program should be continued. In consideration of the objectives of a mandatory preventative maintenance program for the collection system to: anticipate problem areas and initiate action before any problems occur; to reduce potential claims for damages resulting from system failures; and in avoidance of future liability costs, an increase of 6 full-time staff positions for the Wastewater Collection System unit is recommended. Table 1-10 identifies the proposed budgeted operating expenses for the Collection System unit with a suggested 3 -year implementation schedule beginning in 2002. HDR ENGINEERING, INC. CITY OF YAKIMA SUMMARY - OCTOBER 25, 2000 PAGE 19 DRAFT =hil 1-10. v. Cit of Yakima Pruidua,ud Collection System Expenses Description Estimated 2001 Estimated 2002 Increase 01-02 Estimated 2003 Increase 02-03 Estimated Increase 2004 03-04 Staff Costs Operating $1,115,950 $1,275,000' $159,050 $1,425,000' $150,000 $1.575,000* i $150.000 Supplies, 'Maintenance Machinery, and $195,546 $223,000 $27,454 1 $249,000 I $27,000 $276,000 $27,000 Equipment City Services/Ancillary $293,363 $338,000 $44,637 $378,000 $40,000 $418,000 $40,000 Costs2 $600.570 $688.000 $87,430 $770,000 $82.000 i $851.000. $82.000 Total $2,205,429 $2,524,000 $318,571 $2,822,000 1 $298.000 $3.120,000 I $298.000 '2 1-.1 h added 2002, 2 )~ 1Es added 2003.2 FTEs added 2004_ Customer services, administrative overheads, state and local fees, and other charges. HDR ENGINEERING, INC. CITY OF YAKIMA SUMMARY - OCTOBER 25, 2000 PAGE 20 Table 1-12.0-6 Year Pri Improvement Numbers Facility Description _. r Opinion of Probable Cost Mandatory.' Regulations Renewal /Safety. Growth2 F W WiP-2 Emergency Gmvatar overibubreplmement S100.000 S100.000 FW WTP-3 Pnnu y Clxifer Collection Mecham= (2 0l 4) 5200,000 5200.000 F W WTP-40 Primary Sludge Pmnping lighting Replaconen 510,000 SI0,000 FWWTP-7A Trickling Filler Door/Walkway Covers 585.000 S85.000 F W WTP-7B Trickling filter Mechanism (Both) S650.000 5325.000 5325.000 F WW7P-8A Repair Existing Amnon Basin 5181.000 5181400 FWWTP-8B Replace Blower VMS (2of4) 5245.000 5245,000 F W WrP-8C Aeration Basin Diffusers Rehab S50.00) 550.000 FW WTP•9A Refurbish Secondary Clarifier Bull -Gears 6120,000 S120.000 FW WrP-9B Replace Secandar Clarify Exterior Landers 5257,000 5257.000 FWWTP-9C Replace Secondary Clarifier Skvmnes Mechanism/Scum Box S362.000 5362.000 F W WPP -10 Refurbish DAFT Air Compressor/Pipelines 5267,000 5267,000 _ """'-" &$0M0 558.000 Deleted from Plan F4444143 - 850.000 850.000 Delbert from Plan FWif?P•7D Trickling Filter Clarifier Solids Removal System /Det nrerurg 1415.000 Moved from 13.103+ 5413,000 FWI3TP-7D Trickling Filter Clarifier Gates 550,000 Movedjrom7-12 yr 550,000 Trickling FiilterEffluent Pumping Station 5651,000 Added 1652.000 Secondary Clarifier Spray Nozzle uutallanon 515.000 Added 115.000 FWWTP-14 Secondary Clarifier Evaluation Miscellaneous 550.000 550.000 FWWTP-I5 S200.000 5200.000 Improvements Subtotal FWWTP Improvements 53.919.000 5526.000 51.926.000 51.467.000 WWIP•2 Gnt Storage Hopper 5100,000 5100.000 wWTP-5 New RAS/WAS Pimping Station 51.669,400 51.669.400• W{i713-119 New Centrifuge 1.345.000 51.343.000 Moved from 7-11 yr WWIP-6 New Secondary Clarifier 53.277,800 53.277.800• WRTP-I3 Thick Stange S400.000 5.400.000 WW7P•16 Biosolids Handling 53.100.000 53.100.000 Subtotal W TP Improvements 59.892.200 58.447.200 51.445.000 SO TOTAL Treatment Plant improvements 513.811.200 58.973.200 53.371.000 51.467.000 Coliecuon ModeVMomtormg Section 22 5240,000 5240.000 Collecuon Facility Table 11-11 5694.000 S694.000 Coliecuon Facility Table 11-13 & 11.15 Collection 52.489,300 51.173.000 51,316,3001 Facility. Table 11-14 (20%13 53.625.000 52308.700 51316300 Subtotal Collection Facility 57.048.300 52.548.700 51.867.000 52.632.600 TOTAL TREATMENT/COLLECTION • Mama= benefits t0 Grawtn reh,M let -nee 520,859.500 511521.900 55.238.000 S4.099.600 Compliance with federaustate laws and regulations, and the Four Party Agreement ` Non -mandatory growth /system expansion. • 30% Mandatory, 70% Growth ttaucs nem nave peen brought forward Table 1=13.742 Year Priori Irnm ov�i Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Regulations Renewal !Safety Growth: F W WTP-1 FWWTP-3 FW W1P-5 FWWTP-6 6 Ft. iB influent Building 550.000 Pnmary Clarifier Collation Mechaatrms (2 of 4) 5200.000 Sludge Transfer Building Refurbishment 5100,E Replace enter ace intermediate Grit Boz C wan 5240.000 5200.000 550,000 5200000 5100,000 5250,000 1494464 5245.000 560,000 5200.000 Moved to 0-6 years Moved to 0-6 years .'1 i'WATP 7DT4iabliug-P403166lasifser-reeses-1692000 3391.300 Replace Blower VFD's (2 of 4) 5245,000 install Secondary Digester Gas Flare 560.000 Miscellaneousimprovemmts 5400.000 FW W TP -8B FW WTP-11 B FWWTP-15 Subtotal FWWTP mprovemeuts 51.305.000 5200.000 51.105.000 W'a`r: P -2 WWTP-7C WWTP-4A WWTP-413 WWTP-7A WWTP-7B WWTP-8 WWTP-9 WWTP-I0 WWTP-11A s'tITP 11B Gtii Stange Hoppa Additional Blower Trickling filter Media Replacement Trickling filter Forced Vent ladon Anoxic Selector Cells Aeration Basin (2.1 mg) UV Disinfection WAS Thickening Colgate Pretreatment Solids Building 5212,100 5547,800 34400400• 51.066.100 52,480.000 54366.600 53.931,100 S1.338.600 51,912,700 53,412,6000 52,480,000 53.931.100 S 1.338,600 51,912.700 53,412.600 5212.100 S547,800 Deleted due to testing done 84400400during Fall 2000. Moved to beyond 2020 unless media plugs at loads > tested 81.066.100 - 54,366.600 • • • Moved to 0 6 yr as existing Bird Centrifuge bas WWTP-I IC WWTP-12 WWTP-14 PolymerSy.rem Laboratory Modifications New Boiler/hot water J 51,384,160 S976.200 51.000.000 5150.000 5976.200 51.000.000 faded tbrefore 8150.000 no redundancy e • • Subtotal WWTP improvements 521393.800 S15.051200 51.428200 54.914.400 TOTAL Treatment Plant Improvements 522.698.800 S15.251.200 52.533.200 54.914.400 Collection Facility Table 11-15 (int only)' I Mamma/Ice Bldg Sacon 11 ! Collection Facility Table 11-14 (40%1' 56.291.700 83257,600 512.642200 52.282.400 82.606,100 53.792.700 54,009300 5651.500 58.849.500 Subtotal Collection Facility 522,191.500 58.681200 513.510300 TOTAL TREATM1MENTicar 1 rt -Aura 84.890.100 • tnaates benefits to Growth reiate:i ma... 823.934400 52.533200 818.424,700 Compliance with federal/state laws and regulations, and the Four Party Agreement Non -mandatory growth /system expansion. 30% Mandatory, 70% Growth 1 able 1-14, 13-20 Year Priority improvement Projects Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Regulations Renewal /Safety Growth= FWWTP-4A Primary Sludge Pumping Density and Flow Meters 5240,000 5240,000 Fern'_ z"-" Solids-Removal- BABA S4i-57000 Moved to 0-6 years Systelm'Dewatering Add Secondary Digester FWWTP-11A Recirculation Pumps 5203,000 5203,000 FWWTP-15 Miscellaneous Improvements 5400.000 5400.000 Subtotal FWWTP Improvements 5843.000 5843.000 WWTP-1 Septage Receiving Facility 52,079,300 52,079,300 WWTP-3 Primary Split Box 5870,500 5870,500 * WWTP-7C Additional Blower - 2nd 5547,800 5547,800 WWTP-15 Mesophilic Digestion 54.000.000 54.000.000 Subtotal WWTP Improvements 57.497.600 52.079.300 5870.500 54.547.800 TOTAL Treatment Plant Improvements S8.340.600 52.079.300 S1,713.500 54.547.800 Collection Facility Table 11-14 510.844.700 53.253.400 57.591.300 Subtotal Collection Facility 510.844.700 53.253.400 50 57.591.300 TOTAL TREATMENT/COLLECTION S19.185.300 S5.332.700 S1.713.500 _ 512.139.100 * Indicates benefits to Growth related issues Compliance with federal/state laws and regulations, and the Four Party Agreement Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth Table 1-15. Summary of Improvements MANDATORY' OPINION OF TREATMENT / RENEWAL / TOTAL %TOTAL %, COLLECTION PROBABLE REGULATIONS SAFETY MANDATORY �(;ROWTI12 GROWTH COSTS Wastewater Treatment 0-6 Year Projects $ 13,811, 200 $ 8,973,200 $ 3,371,000 89,.4% $ 1,467,000 10.6% 7-12 Year Projects $ 22,698,800 $ 15,251,200 $ 2,533,200 78.3% $ 4,914,400 21.7% 13-20 Year Projects $ 8,340,600 $ 2,079,300 $ 1,713,500 4505% $ 4,547,800 54.5% Total Treatment Plant Im rovements 44 '850600 ' 26303 $ ,700 $ 7,617,700 75„6 /o ° $ 10,929,200 24.4% Collection Faciltiy 0-6 Year Projects' $ 7,048,300 $ 2,548,700 $ 1,867,000 62.6% $ 2,632,600 37.4% 7-12 Year Projects $ 22,191,500 $ 8,681,200 $ - 39.1% $ 13,510,300 60.9% 13-20 Year Projects $ 10,844,700 $ 3.25.3,400 $ - 30.0% $ 7,591,300 70.0% Total Collection Facility improvements $ 40,084 500 '$ $ 14,483,300 $ 1,867,000 40.8 /° 23,734,200 59.2% Total Treatment / Collection $ 84,935,100 $ 40,787,000 $ 9,484,700 59.2% $ 34,663,400 40.8% _ Mandatory compliance with federal/state laws and regulations, and the Four Party Agreeement, Non-mandoratory growth/system expansion receives a benefi l from mandatory projects - Non-mandatory growth/system expansion ' For the 0-6 Year period, a total of $20,859,500 is required. $16,759,900 or 80.3% percent, is required to meet mandatory obligations. $4,099,600 or 19.7%, i. required to rneet non-mandatory growth/system expansion. SECTION 1 INTRODUCTION AND EXECUTIVE SUMMARY History: As a condition for receiving State and Federal grants from the Environmental Protection Agency and the State Department of Ecology, the City is obligated to complete a Biennial Cost -of -Service Study. The study is mandated to ensure that utility rates provide adequate funding for: (a) operating and maintaining the Wastewater Treatment Plant and the Wastewater System; (b) bond debt service payments; (c) satisfaction of bond and loan covenants relating to debt services coverage ratios, reserves, etc.; (d) capital reserves to match new grants; and (e) utility comprehensive planning. Chapter 7.60.020 E of the Yakima Municipal Code states: "The city shall review not less often than every two years the wastewater contribution of users and user classes, the total cost of operation and maintenance of the treatment works and the user charge system. The charges for users or classes of users shall be revised as required." Current Situation: In 1994 and 1996, staff prepared a Cost of Service and Rate Study, which reviewed and recommended rates for all user groups served by the system. These reports also identified the need for rates to increase 3- 5% annually. In 1998, rates were increased 5% to cover a portion of the costs of ongoing litigation. These costs had not been anticipated by the earlier Studies. In 1999, rates were adjusted 2% to finance debt service on a specific capital program. Both of these increases were for requirements in addition to the 3-5% annual increase need previously identified. As stated in the previous Transmittal, the Updated 2000 Wastewater Facilities Plan (Facilities Plan) identifies over $20.9 million of capita( improvements required within the next 5 years to maintain our ability to serve the community. Of this. $16.7 million (80%) are mandated by Federal and State regulations and contractual obligations. The Facilities Plan also identifies the need for an additional $44.8 million of improvements during the years 2007-2012. and $19.2 million during the years 2013 through 2020. The Wastewater Division's ability to meet the needs of the environment and community are facing a very expensive 2001 COS Section 1 Page 1 October 10, 2001 future. There will be grave consequences to the City's ability to accommodate growth if these challenges are not adequately met. Litigation costs related to the alleged odor complaints now obligate most transfers into the Capital funds. Within five years. a moratorium on new connections is in the future of the Wastewater Division if the recommended rates increases are not adopted. All Wastewater Funds have declining reserves in spite of reduction in expenses over previous years. The present rates will support only a reduced operations and maintenance activity with minimal transfers to capital funds. All proceeds in the Capital funds will be dedicated to the ongoing litigation. Money for any potential damage award is beyond and in addition to these transfers Within _ ,_ Wastewater 1, a e:. •.m:ea ro and will require a separate rate increase. Within the Wastewater Divisioi current rates mean Tess; less service to our customers, Tess ability to accommodate new customers, less ability to meet our mandated permit obligations to the environment and the community. Although the financial impact of the mandated capital programs is significant, on an annual basis, the impact of mandated staffing is also great. By 2005, the overall annual impact of increased debt service will be approximately $921,500. Annual Capital transfers which provide a local cash match to secured borrowed financing will increase by another $100,000. The City of Yakima's Pretreatment Program is scheduled to receive full delegation with the issuance of our next NPDES permit, scheduled for July 1, 2002. Delegation mandates the City's responsibility and authority under the Clean Water Act to issue discharge permits to commercial and industrial dischargers within the City's service area. Fulfillment of these mandated obligations will require a minimum of three additional staff (1 permit writer, 2 field personnel), one vehicle, and equipment by mid 2002. This represents an annual increase of $264.000, though this report recommends that 75% of this be funded through this program by its customers. The Facilities Pian also identifies the need for an increase of 6 full-time staff positions (with equipment) for the Collection maintenance arm of our division to achieve our maintenance goal to "anticipate problem areas and initiate action before any problems occur; to reduce potential claims for damages resulting from system failures". This represents an annual increase of $865.000. This financial burden falls entirely on the retail customers_ Therefore. the combined annual impact of mandated staffing 2001 COS Section 1 Page 2 October 10, 2001 increases for pretreatment and collection maintenance is approximately $1,129,000 ($5.7 million over 5 years). The total requirement for Capital and Operational_ needs outlined in the Facilities Plan is $26.6 million over 5 years. This 2001 Cost of Service and Rate Study again does a comprehensive review of the cost to serve all user classes. The user groups include; Pretreatment, Outside City (County) retail, Outside City strong waste and Septage Disposal, Municipal Wholesale (City of Union Gap and Terrace Heights Sewer District), City strong waste, and City retail. Food Processing Wastewater (Industrial Waste) is no longer a separate customer class. Wastewater from this category is now brought into the treatment facility for treatment and former customers are now City strong waste customers. This study uses historical data on operating revenues and other income, operating expenses, debt service, plant flows, billable flows, strength of flow from different user groups, and existing and projected capital expenditures in the wastewater system. Purposes of the Study: The purposes of this study of cost of service and rates are to: • Determine and report revenue and funding requirements for the wastewater system operations for a 6 -year planning period (fiscal years 2001-2006). • Provide a cost of service analysis which: (1) determines unit costs of providing service; and (2) allocates costs of providing service among classes of customers of the wastewater system. • Develop and propose any necessary changes in the wastewater service charges and other (capital) charges for the customers of the wastewater system. Adoption of these recommendations will enable the wastewater system to continue its operations and make capital improvements on a financially sound foundation. 2001 COS Section 1 Page 3 October 10, 2001 Study Content: For this study, staff has conducted the following tasks: Reviewed existing financial policies of the City as they pertain to wastewater costs of service and charges presently in effect. • Reviewed Federal Government (Environmental Protection Agency) and State (Department of Ecology) rules and regulations and City documents governing costs of service and rate related issues. • Reviewed the most current applicable publications and manuals issued by the American Water Works Association (AWWA), Water Pollution Control Federation (WPCF), American Society of Civil Engineers (ASCE), and American Public Works Association (APWA) pertaining to financing and rate charges for wastewater systems. • Performed a financial projection and developed a financial plan for a 6 year planning period (fiscal years 2001-2006), which documents the revenue and cost items affecting the calculation of rates for the wastewater system operations. • Projected operating revenues (at present rates) and other income, operating expenses, debt service, and capital expenses to determine revenue and funding requirements. • Compiled and reviewed historical account of billable flow records for all user groups • Reviewed location and installed cost of collection system projects to determine which user group or groups benefit from each. • Sampled and tested representative flows from several of the user groups for strength of suspended solids (SS) and biochemical oxygen demand (BOD) • Reviewed current methods utilized by City staff in establishing rates and preparing billings to all user groups. • Developed costs for a mandated delegated Pretreatment permit and monitoring program. 2001 COS Section 1 Page 4 October 10, 2001 • Performed cost of service analysis which determines the costs of providing service to: 1) Pretreatment businesses; 2) non -owner (County) retail, strong waste and septage customers; 3) wholesale municipal users of the system (the City of Union Gap, and the Terrace Heights Wastewater District); 4) City strong waste customers. • Developed proposed wastewater service charges and other charges for: 1) Pretreatment Program businesses; 2) Non -owner (County) retail, strong waste, and Septage customers; and 3) Owner (City) retail and strong waste customers. Findings of the 2001 Study; As a recipient of Federal grant assistance.. the City is rewired to "Generate sufficient revenue to pay the total operation and maintenance costs necessary to the proper operation and maintenance (including replacement) of the treatment works." 40 CFR 35.92 [) (21. • "The user charge system must be designed to produce adequate revenues required for operation and maintenance (including replacement). It shall provide that each user which discharges pollutants that cause an increase in the cost of managing the effluent or sludge from the treatment works shall pay for such increased cost." 40 CFR 35.2140. • "The grantee shall adopt its sewer use ordinance and implement its user charge system developed under 35.2130 and 35.2140 before the treatment works is placed in operation. Further, the grantee shall implement the user charge system and sewer use ordinance for the useful life of the treatment works." 40 CFR 35.2208. • This study agrees with the discussion of Contractual Agreements set forth in Appendix 4 of the 1991 County report which states: "The 1976 Agreement is the controlling document. The sewer rates shall be based on a cash basis with actual cost of operation to be used to set rates for Union Gap and Terrace Heights Wastewater District. The County has previously agreed to accept the Utility Method of Accounting as an alternative (to the 2001 COS Section 1 Page 5 October 11, 2001 1976 Agreement) to setting outside City retail rates, provided American Water Works Association (AWWA) and Water Pollution Control Federation (WPCF) recommended procedures are used. The wholesale rates are based on measured flow or contracted capacity. A. Nationally accepted guidelines are those prepared by the AWWA and WPCF. B. The City agrees that the high strength waste customer or industry should pay their full cost of service and no subsidy should be provided by wholesale or outside City customers. • Rates for non -owner retail (outside -of -City) customers should continue to be established utilizing a "Utility Rate Basis" which shall consist of: (A) treatment plant operations and maintenance, depreciation and return on investment (ROI) charge based upon the percentage of actual flow received; (B) applicable collection system operation and maintenance costs; (C) collection system depreciation and ROI charge based upon those pipes actually being utilized by this group; and (D) a strong waste surcharge if applicable. For the purpose of determining the surcharge, this report uses 300 mg/I as the threshold level for BOD (5 day) and suspended solids. This is the threshold level identified for use in wholesale billings in Section 3 of the 1976 Agreement. • Rates for septage (non -owner) customers should also be established utilizing a "Utility Rate Basis" which shall consist of operation and maintenance, depreciation, and ROI charges based upon the BOD, SS, and Hydraulic volume impact to the Treatment Facility. • Rates for wholesale municipal customers; (City of Union Gap, and Terrace Heights Sewer District) should be established utilizing a "Cash Method" which consists of: (A) an operations and maintenance charge which consists of a percentage (based upon meter readings of flow and test results of BOD and SS) of the Treatment Plant loading; (B) any applicable collection system operation and maintenance costs; (C) a debt service charge based upon the percent of Treatment plant capacity allocated to each entity; 2001 COS Section 1 Page 6 October 10, 2001 • The City of Union Gap shares the expense of the Rudkin Road Lift Station with the City of Yakima. These costs are allocated in the manner described in component A and C above. City retail (owner) customers: Rates are established utilizing a "Cash Method". These rates are established to fulfill the remaining necessary revenue demands of the system. • Table 4-2B shows that during the period 1998 (actual) through 2001 (Y -E budget), Operation expenses have increased 7.8%, and Capital expenses have increased 20.0%. This yields a Wastewater Division expenditure increase of 11.7%. Review of Table 5-1 shows that during the same time period, billable flows have increased only 0.5%. Therefore, rates set in 1996 and implemented in subsequent years are no longer sufficient to maintain the system expenses. • Through the use of projected billable flows from all user groups and projected expenditures for existing programs with NO capital improvements, staff has calculated that if rates remain at present levels, during the year 2002, the Wastewater System will operate at a $755,853 deficit (see Table 4-1A). This represents a 7.3% deficit. • Through review of past flow data, staff projects that billable flows will increase at a rate of about 0.6% for the next few years (see Section 5). By reviewing budgetary trends (see Section 4), staff projects expenses to increase at a rate of 8% for this same time period. Therefore, wastewater revenues must increase substantially to meet future expenditure projections. • The existing Pretreatment Program was to assess 75% of its expenses to its customers. During 2001, this program will recover only 40% of its expenses. • Existing rates for "Strong Waste" (BOD and SS in concentrations over 300 ppm) are Tess than the existing cost to treat. City Retail Customers are currently providing a 39.7% cost -share to the City Strong Waste customers. • As rates for the City Retail Customers are established on a "Cash Basis", any required revenue not generated from other users groups must be included in this category. 2001 COS Section 1 Page 7 October 10, 2001 • Per chapter 7.60.020 E of the Yakima City Code, this report should be updated not less often than every two years and charges should be revised as required. Factors Affecting the Necessary Rate Increases; The following factors contribute to the requirement to generate an additional $26.6 million by 2006. • Capital Improvements; in addition to financing of existing debt for past capital projects, the 2000 Wastewater Facilities Plan identifies over $20.8 miiiion in capital projects required during the next 5 years. Of this amount, over $16 million are mandated by Federal or State regulation or contractual obligations. Financing of these projects will require a combination of transfers from the operating fund and new borrowed money. Currently, our cash reserves are being utilized to finance a few Capital projects and the ongoing litigation. Wit lout a rate increase, litigation costs alone will deplete all reserves; we will no longer be able to finance any construction activity. It is important to maintain a solid level of cash reserves. This allows the City to be able to take advantage of low interest financing opportunities from State and Federal agencies for mandated activities. • Long Term Debt; increase of $668,300 (38.6°k) in annual Debt Service represents increased payments of debt service for over $13 million of new debt anticipated during this period to finance the capital improvements identified in the 2000 Wastewater Facilities Plan. • 2.0 Debt Service Coverage to preserve Council policy: A decrease Of $463,000 (33.7%) annual requirement because of retirement of an SRF loan. The new loans are budgeted to be such that debt coverage is not required in the near term. Existing Council Policy states that City Utility Tax NOT be applied against any revenue received for debt coverage. • Wages. Benefits. and Equipment: Annual increase of $1,129,000 (16%) ($5.7 million over 5 years) represents annual wage, benefit, and equipment cost increases for the addition of staff recommended in the Plan prior to 2006. Additional staff is required by the mandated Pretreatment program and to promote compliance with operations, maintenance, and programmatic needs as mandated by State and 2001 COS Section 1 Page 8 October 10, 2001 Federal regulations. During this period, additional staff include: (1) Pretreatment permit writer; (2) Pretreatment field personnel; and (6) Collection maintenance personnel. • Interest Income: Decreased due to drop in interest rates and reserve levels. Necessity of Rate Increase: Staff appreciates the difficulty and apprehension any governing body has when confronting the unpopular task of raising fees to its constituency. Staff pursued the possible ramifications and repercussions of not increasing rates. We reviewed a scenario under which the division stopped all construction activity and decreased its capital transfers to cover only the litigation expenses. No staff additions were made to the collection crew. The mandated additions were made to the Pretreatment unit but they are basically self-supporting. As indicated on TABLE 4-1A, for 2002, the system's expenses are predicted to be: 1) Operation and Maintenance (including taxes) $ 7,178,514 2) Capital Expenses $ 2.860.753 TOTAL $10,039,267 Anticipated revenue for 2002, at existing rates, is $9,428,651. Therefore. without a rate increase. for the year 2002. the system would be operating at a loss of $607,662. For 2002, this loss will be covered by fund reserves. Pursuant to Council policy, the Wastewater Division attempts to maintain an operating reserve that would provide sufficient resources to maintain operations for a period of three months without income. At the budget Jevel presented. this reserve should be approximately $2.4 million. In spite of curtailed activities. without a rate increase this reserve will reach $0.00 by 2003. Furthermore. our debt coverage ratios will be out of compliance with existing bond covenants. 2001 COS Section 1 Page 9 October 10, 2001 Rate Policy Options: Review of the existing rate structure reveals that current City policy still provides for a subsidy to two user groups: (1) Businesses, which the City is required by EPA and DOE to monitor through a Pretreatment Program; (2) City Strong Waste customers. All subsidies to any user group increase the rates charged to the City retail customers. These user groups are subsidized in the following manner: (1) Pretreatment Program: As detailed in Section 6, the current rate policy provides a 25°/o cost share to these customers. This report proposes this level be maintained. 2) City Retail Strang Waste Customers: Rates adopted from the 1994 COS were a compromise that still contained an 18% cost share. The 1996 COS proposed the cost share be further reduced. These recommendations were not accepted. The cost share has now increased to 39.7%. The 2001 COS looks to establish rates at the full cost -to -treat which will eliminate the cost share burden on the retail ratepayer. These rates are discussed in Sections 11. • The decision made on how much, if any, subsidy to provide these groups affects not only that group but directly affects the CITY Retail Customers rates as they pay for all subsidies. City retail rates are affected by 1% for each $100,000 of revenue not received from other user groups. 2001 CAS Section 1 Page 1 0 October 10, 2001 Recommendationsz Staff progressed through a detailed analysis of Cost of Service and Rate Review for each user group of the Wastewater system. This report proposes rate adjustments for each group to that level established by the Cost of Service Study. Table 1-1 Summary of Proposed Rate Adjustments compares the additional revenue from, percent increase to, and subsidy level of each user group under the proposed rate adjustments. (Please see the following). • Staff requests adoption of the 2001 Cost of Service and Rate Study • Staff requests adoption of enclosed legislation necessary to adjust the Wastewater Rates to those proposed and detailed elsewhere in this report. The proposed level rate being; User Group Pretreatment Program County Retail Wholesale Municipal City Retail Strong Waste City Retail 2001 COS Section 1 Page 11 October 10, 2001 adjustments of major user groups % Increase 42.8% (maintains subsidy at 25%) 14% 0% Adjustment per 1976 agreement 39.7% (eliminates current subsidy) 35% Statewide Comparison In 2000, the AWC 2000 Tax & User Fee Survey was published. For comparative purposes, we have listed existing sewer rates and those proposed by this 2001 Yakima Rate Study under the same situation used for comparison in this Survey. Unfortunately, this survey did not address charges did J t L _ differentiate 22 � ._ .. 1' . 1. L . 1. _ ... fixed _ .. J ._ �l strong waste cnarges nor aid tney dif eren late between IIxed atnd variable charges. We have compared only with agencies, which have over 10,000 residential customers. A copy of the full survey is available upon request. Single Family 1,000 cf Rank of Residential 3/4" meter (201) Customers 0:400.0) 342a L : A.. y(proposed)$3ix:58:: YAKIMA County (existing) $44.61 YAKIMA County (proposed) $50.85 Alderwood Bellingham Edmonds Hazel Dell Kennewick Lakehaven Lakewood Longview Marysville Northshore Olympia Richland Seattle Shoreline Soos Creek Tacoma Average 2001 COS Section 1 Page 1 2 October 11, 2001 ( 13) ( 7) $26.78 ( 96) 17,900 $24.25 (124) 16,442 $21.97 (137) 10,549 $21.25 (142) 15,670 $16.21 (183) 10,177 $26.48 (101) 18,988 $19.45 (1 57) 11,446 $26.97 ( 95) 11,263 $40.00 ( 1 9) 10,141 $30.50 ( 69) 16,436 $35.89 ( 37) 10,431 $30.70 ( 66) 14,164 C�A9 f1 / iA\ A�1 O1') WYJ.2 1 1't) 1't ,U 1 G $26.40 (102) 10,147 $34.30 ( 45) 21,235 $30.04 (72) 76.507 $28.40 Table 1-1 SUMMARY COMPARISON FOR FINAL YEAR OF PLANNING PERIOD 2006 10/9/01 Report % Income :• % Income $ % Customer Group Section Cost Existing Cost Proposed increase increase Share Rates Share Rates 2006 2006 2006 Expense $13,270,624. 2001 COS 2006 Revenue with Existing Rates $9,672,744. PROPOSED Revenue Shortfall 2006 $3,597,880 . RATES 37.20% Pretreatment Program 6 S11 $56,448 25% $432,523 $376,075 new MPJ 60.0% $167,083. 25% $280,812 $113,729 66.6% County Retail 7 12.7% $144,792 $164,988 $20,196 13.9% Wholesale Municipal 9 $801,974 .. . $801,974 $0 0.0% automatic adjustment per 1976 Agreement Miscellaneous Income $363,418. $443,325 $79,907 22.0% City Retail Strong Waste 11 39.7% $476,760 $666,130 $189,370 39.7% City Retail Customer 12 $7,662,269 $10,406,414 $2,744,145 35.9% Total $9,672,744. $13,196,166 $3,523,422 36.4% 10/9/01 Table 1-2 (OPTION A) SUMMARY Proposed Rate Adjustments ONE TIME INCREASE RECOMENDED ACTION 10/23/01 Report No. of °lam x 2002 Revenue 2002 Revenue 2002 Customer Group Section customers: 2002 2003 2004 2005 2006 increase at existing Rates at Proposed Rates Additional Revenue Pretreatment Program 6 Combination all customers 42.8% $181,875 $469,812 $2.87,937 ` MIU's 480 66.7% SIU's 54 14.2% Count Retail 7 249 14.0% 14.0% $128,194 $146,069 $17,875 Wholesale Municipal 9 2 Adjust as Applicable n/a n/a n/a Cit Retail Strong Waste 11 244 39.7% (Combined effect all customers) 39.7% $458,157 $640,138 $181,981 DOD : 27.0% 27.4% SS 100.0% 99.3% Cit Retell Customer 12 23,565 . 35.0% 35.9% $7,562,622 $10,270,609 $2,707,987 Total 36.4% $8,330,848 $11,526,628 $3,195 780 10/23/01 2001 Cost of Service and Rate Study Analysis of Adjustment to Owner/Non-owner Rates OPTION A Ready -to- Volume Single Typical Surcharge Surcharge One Month Billing Serve Charge Family Increase BOD SS Charge /100cf 1,000 cf 1,000 cf per Pound per Pound 3/4" meter 1 UOC 3/4" meter 10 UOC OWNER (inside City) PREVIOUS RATE $8.33 $1.49 $23.23 $0.230 $0.150 PROPOSED ADJUSTMENT $11.48 $2.01 $31.58 $8.35 $0.293 $0.299 % increase 37.82% 34.90% 35.94% 27.39% 99.33% NON -OWNER (Outside City) PREVIOUS RATE $16.01 $2.86 $44.61 $0.502 $0.493 PROPOSED ADJUSTMENT $18.25 $3.26 $50.85 $6.24 $0.412 $0.419 % increase 13.99% 13.99% 13.99% -17.93% -15.01% Table 1-2 (OPTION B) SUMMARY Proposed Rate Adjustments THREE EQUAL ADJUSTMENTS 10/23/01 Report no. of % x 2002 Revenue 2002 Revenue 2002 Customer Group Section customers. 2002 2003 2004 2005 2006 increase at existing at Proposed Additional Rates rates Revenue Pretreatment Program 6 Combination all customers 42.8% $181,875 $469,812 :$287,937 ' MIU's 480 66.7% SIU's 54 14.2% County Retail 7 249 14.0% 14.0% $128,194 $146,069 $17,875 Wholesale Municipal 9 2 Adjust as Applicable n/a n/a n/a City Retail Strong Waste 11 244 . 30.9% 6.7% (Combined effect all custoi 39.7% $4513,157 $599,753 $141,596 BOD 1 27.0% 27.4% SS 50.0% 32.9% 99.3% City Retail Customer 12 23,565 10.5% 10.5% 10.5% 35.9% $7,562,622 $8,421,516 $858,894 Total 36.4% $8,330,848 S9,637,150 $1,306,302 10/23/01 Table 1-2 (OPTION C) SUMMARY Proposed Rate Adjustments ONE-HALF, THEN FOUR EVEN STEPS 10/23/01 Report no. of % x 2002 Revenue 2002 Revenue 2002 Customer Group Section customers 2002 2003 2004 2005 2006 Increase at Existing at Proposed Additional Rates Rates Revenue Pretreatment Program 6 Combination all customers 42.8% $181,875 $469,812 $287,937 MIU's 480 66.7% SIU's 54 . 14.2% County Retail 7 249 14.0% 14.0% $128,194 $146,069 $17,875 Wholesale Municipal 9 2 Adjust as Applicable n/a City Retail Strong Waste 11 244 30.9% 6.7% (Combined effect all custor 39.7% $458,157 $599,753 $141,596 BOD 27.0% 27.4% SS 50.0% 32.9% 99.3% City Retail Customer 1 2 23,565 17.5% 3.50% 3.50% 3.50% 3.50% 35.9% $7,562,622 $8,940,652 $1,378,030 Total 36.4% $8,330,848 $10,156,286 $1,825,438 10/23/01 SECTION 2 BACKGROUND INFORMATION FOR THE WASTEWATER COST OF SERVICE AND RATE STUDY Introduction; This section reviews and discusses background information pertinent to the City of Yakima's wastewater system cost of service and rate study. Included in this background information are: (1) a description of the wastewater system of the City of Yakima (City) and the service provided by the City through its treatment and collection facilities; (2) provisions of the Agreement for Wastewater Treatment and Disposal Service (herein called the 4 -Party Agreement), signed by the City, the City of Union Gap (Union Gap), the Terrace Heights Sewer District (Terrace Heights), and the County of Yakima (County); (3) review of City wastewater rate proposals; and (4) review of financial policies and issues surrounding the development of wastewater rates and charges for City wholesale users and retail customers. Description of the City's Wastewater System: The City provides wastewater system services to owner retail customers (called herein City retail), non -owner (County) retail customers, septic dumpers (called herein Septage), Union Gap, and Terrace Heights. Reference is made throughout this report to City retail and County retail customers. In fact, the County provides no Wastewater services within the area pertinent to this report. The customers to whom the report refers are customers of the City's wastewater system who live outside of the City limits (in the county). The Retail System both inside and outside of the City serves approximately 21,700 retail accounts, additionally, Union Gap serves 1,400 retail customers, and 1,550 retail customers are served by Terrace Heights. Septage Disposal is provided at the City's treatment facility. Fruit processing waste discharged by industrial customers of the City, which used to be applied to a sprayfield is now treated through the treatment facility. 2001 COS Section 2 Page 1 October 10, 2001 During the 1970's, a 1976 Facility Plan was prepared for the region to enable it to meet requirements of the Federal Water Pollution Control Act. During the period 1976 through 1983, implementations of the improvements recommended in this plan were accomplished. This resulted in upgrades and expansion of the regional wastewater treatment plant and construction of interceptors to transport wastewater to the treatment plant from Union Gap, Terrace Heights and the unincorporated areas (County) surrounding the City. The 1975-1989 improvements to the wastewater system, totaling over $33,000,000, were financed by a grant (75% of eligible costs) from the U.S. Environmental Protection Agency (EPA), a grant (15% of eligible costs) from the State of Washington's Department of Ecoiogy (Ecology) from funds authorized by Referendum 26, and by local funds (10%). (Combined, the grants covered less than 8O% of total project costs) The current system of rates was first established in 1978, through a comprehensive Wastewater Rate Study conducted by R. W. Beck and Associates, Seattle, Washington. In 1981, the firm of Brown and Caldwell, Seattle, Washington performed a wastewater rate update study. In late 1985, the State of Washington's Department of Ecology (Ecology) issued a compliance order for correction of treatment plant facilities that were experiencing hydraulic, organic and solids loadings that exceeded 1976 Facility Plan design assumptions. HDR Engineering, Inc. was subsequently employed to update the City's 1976 Facility Plan and a study was completed in June 1989. The resulting 1989 Facility Plan provided a list of capital construction projects and estimated increases in wastewater service costs expected as a result of implementing the programs contained in the Plan. Implementations of the necessary improvements to the Wastewater System identified in this 1989 Facility Plan, totaling over $25,000,000, were initiated in 1991. The improvements to the treatment facility were financed in part (42%) by a Grant from the U.S. Environmental Protection Agency (EPA), low interest loans (15%) from the State of Washington Public Works trust Fund (PWTF), and (43%) by local funds. The identified improvements within the collection system have been addressed by recent construction. These improvements were financed in part by low interest loans from the Public Works Trust Fund. 2001 COS Section 2 Page 2 October 10, 2001 The Mandated Draft 2001 Wastewater Facilities Plan has been circulated, reviewed and is awaiting adoption. This document looks to the capital and operations and maintenance requirement of the wastewater system to serve the area for the next 20 years. Indicated in this document are extensive investment needs over the next 6-20 years for Mandates, Renewal/Reliability, and Growth. The needs during the next 6 years alone are for the treatment facility ($13,811,200 - 89.4% mandated) as well as the collection system ($7,048,000 - 62.6% mandated). Over 80% or $16.76 million of the total 6 years program is mandated by regulations or contractual obligations to customers. If these mandated expenditures are not made, the wastewater system 1- . • "I . - 11 ! . e 1 .IS - - . .1• criminal penalties, as well as a Building Moratorium within 6 years Compliance with federal and/or state mandatory regulations requires adequate funding sources regardless of ability to pay. Although the federal and/or state regulatory agencies sometimes provide partial funding for mandated improvements in the form of grants and/or loans, those resources have been drastically diminished over the last decade. As a consequence, the City of Yakima and the Yakima Regional WWTP will be required to use wholesale and retail revenues to pay a substantial portion (as much as 90% or more) of the total cost either as cash or through debt payments. As set forth by this report, the impact to wholesale and retail rates will be significant The City operates a Regional Wastewater Treatment Plant that can currently process up to 22.3 million gallons per day (mgd) of wastewater. The City's wastewater facilities, in addition to the treatment plant, include a collection system with nine minor lift stations and one major lift station on Rudkin Road. The collection system consists of approximately 26,800 linear feet of 30" to 48" transmission pipeline, 85,300 linear feet of 20" to 27" transmission pipeline, 96,200 linear feet of 15" to 18" transmission pipeline, and 1,335,260 linear feet of local collection system lines (6" to 12"). This equates to over 292 miles of wastewater lines, and a $95,000,000 present worth investment in the wastewater collection system. Terrace Heights is connected to the City's wastewater system via their lift station and connecting pipeline which discharges at the treatment plant. 2001 COS Section 2 Page 3 October 10, 2001 Wastewater flow received from Union Gap is discharged into an interceptor flowing to the Rudkin Road lift station. After passing through the lift station, Union Gap wastewater flows to the collector box leading to the treatment plant. Agreement for Wastewater Treatment and Disposal Facilities, In 1976, the City entered into an Agreement for treatment and disposal services with the County, Union Gap and Terrace Heights. At the time the four parties entered into the Agreement, it was recognized that planning for the future disposal of wastes was needed to meet water pollution controi requirements and eliminate health hazards. In the Agreement, the City agreed to accept wastewater delivered to it by the County, Union Gap and Terrace Heights for processing through the City's Regional Wastewater Treatment Plant. At the time the original Agreement was adopted, as now, the County did not own or operate its own collection system or treatment facilities. The County was given the right to provide service in unincorporated local service areas, and to enter into appropriate agreements with the City only in the event that neither the City, Terrace Heights, nor Union Gap can provide acceptable service to customers the County proposes to serve. The City of Union Gap and Terrace Heights were responsible for operating and maintaining wastewater interceptor and pumping facilities necessary to deliver wastewater to the City's system. Through the Agreement. the City was given responsibility for establishing retail rates and charges for the non -owner customers (County), and wholesale user rates for Union Gap and Terrace Heights. It was specified that rates should reflect the cost of service for the City to intercept, treat, and dispose of the wastewater from these agency's systems. Eligible costs include system administration, operation, maintenance, taxes, repair and replacement, and debt service for existing and new collection, treatment and disposal facilities including requirements of resolutions surrounding the issuance of revenue bonds. Per the Agreement, all wastewater of the County, Union Gap, and Terrace Heights was to be metered at the expense of the system requesting service. 2001 COS Section 2 Page 4 October 10, 2001 In 1997 a Settlement Agreement was negotiated between those of the 4 -parties who had customers. This Agreement clarified wholesale rate, system ownership, and capital cost issues between those parties (Yakima City, Union Gap, and Terrace Heights). The 4 -Party Agreement also: 1) provides the City with the right to sample wastewater discharges of its customers for the purpose of special charges or identifying unhealthful or incompatible discharges; 2) requires a Special Agreement to be signed with customers discharging wastes of unusual quantity or strengths; and, 3) provides EPA the authority to require correction of the excessive infiltration/inflow occurring within the collection systems. In 1979, the City Council reviewed the Yakima Urban Area wastewater facilities and planning programs. The Council directed City staff to prepare a Resource Allocation Plan within the following guidelines: • The City of Yakima would continue to maintain sole and complete ownership of the treatment plant resources. • The City's sole responsibility was to make available to various jurisdictions a fixed amount of treatment plant and interceptor capacities as designated by the Yakima Area Wastewater Agreement and Yakima Wastewater Facilities Planning Study. • The County would not be allocated any capacity until such time as it had constructed and had operational a wastewater system. • The City would assure that sufficient treatment plant and interceptor capacities would be available to wholesale users per the before mentioned Allocation Plan. • Future capital costs for treatment plant improvements should be distributed to areas that exceed the allocations established for them by the Allocation Plan. Unincorporated areas served by the City's collector system will proportionately decrease the allocation for the remaining areas. • Interceptor capacities within individual service areas (other than wholesale user service areas) should be based upon the capacities that have already been committed. 2001 COS Section 2 Page 5 October 10, 2001 The Resource Allocation Plan was not intended to modify the terms of the 1976 Agreement, but was intended to use past agreements and policies to define future courses of action. In summary, the steps in implementing the Resource Allocation Plan involved: • Developing a comprehensive wastewater system plan which establishes the existing collector system's ability, by drainage basins, to accommodate sewage flows. • Establishing percentage allocations of treatment plant capacity to the wholesale user jurisdictions for their respective service areas. • Developing a method for the County to receive a service area allocation if/when the County were to provide service to customers in its service area. • Administering the allocation program through wastewater system capital improvement programming and future land use decisions. With respect to executing the steps in the program, allocations of capacity for wholesale users were to be based on flows (average daily flow in mgd) and design populations associated with each agency, combined with allocations of capacity, that insured that each agency had a sufficient level of service. The original allocations of capacity, based on only the hydraulic capacity of the treatment plant, were established in 1979 as follows: PArrant City (and County of Yakima) 90.4 Town of Union Gap 5.4 Terrace Heights Wastewater District 4_.0 100.0 These capacity allocations were amended in 1987 to reflect the purchase of 82% of the South Broadway interceptor by Union Gap, which increased their capacity in the City's Treatment Facility. The allocations of capacity were changed to: City (and County of Yakima) Town of Union Gap Terrace I-Icigh+e \A/mac+opera+®r rlie+rin+ 1 Vt Ib.VV I IVIyI 1L.d ..S AV IV.. a A L'# I VIJ �I1 I 2001 COS Section 2 Page 6 October 10, 2001 Percent 87.9 8.1 n 100.0 Review of the Federal Regulation Affecting Wastewater Rates: Rackground and General Provisions The City has been a recipient of Federal grant funds that were used to upgrade and expand existing wastewater facilities. The grant funded construction projects were completed in 1983 and 1993. Having used Federal grant funds to pay for portions of its facilities- die City is subject to rules and regulations of the Federal grant program far the life of the facilities constructed with such funds The City currently has an approved system of wastewater service charges. This system of charges resulted from an original rate study: (1) Wastewater Rate Study, September 1978, conducted by R. W. Beck and Associates, Seattle, Washington, and the following updates of the original rate study; (2) Yakima Rate Study - Revised Wastewater Rates and Rate Update, October 1981, conducted by Brown and Caldwell, Seattle, Washington; (3) 1989 Financing Plan, prepared by City staff; (4) City of Yakima Wastewater Utility Wastewater Cost of Service and Rate Study, March 1990, prepared by HDR Engineering, Inc. and Public Utility Rate Consultants (PURC); (5) 1994 Cost of Service and Rate Study, August 1994, prepared by City staff; (6) 1996 Cost of Service and Rate Study, November 1996, prepared by City staff; (7) 1999 Wastewater Rate Adjustment and, (8) 2001 Wastewater Rate Adjustment both prepared by City staff. In order to receive approval of its wastewater service charge system, and be eligible for grant funds for construction, the City was required to: • Obtain approval of a plan of study for its existing facilities. • Obtain award of a grant for the construction of facilities and obtain issuance of a notice to proceed with construction. The source of these requirements for establishment of a wastewater service charge system is contained in Regulations of the Environmental Protection Agency. Provisions of the regulations (from 40 CFR Part 35.2140) directing the City to establish a wastewater service charge system require that: 2001 COS Section 2 Page 7 October 10, 2001 • Each user or user class pay its proportionate share of operation and maintenance (including replacement) costs of treatment works based on the user's proportionate contribution to the total wastewater loading from all users. • Each user charge system must provide that each user be notified, at least annually, in conjunction with a regular bill, of the rate and that portion of the user charge which are attributable to wastewater treatment services. • The user charge system shall provide that the costs of operation and maintenance aintenance_ for all flow not directly attributable to users (i.e., infiltration/inflow) be distributed among all users based upon either of the following: 1) In the same manner that it distributes the costs for their actual use, or 2) Under a system which uses one or a combination nf the following factors on a reasonable basis: a) Flow volume of the users. b) Land area of the users. c) Number of hookups or discharges of the users. • Financial management system: "Each user charge system must include an adequate financial management system that will accurately account for revenues generated by the system and expenditures for operation and maintenance (including replacement) of the treatment system, based on an adequate budget identifying the basis for determining the annual nnorntinn and mnintennnne nnefe nri the !`n etc of narcnnnal material, energy, and administration." [40 CFR 35.214O(d)] In addition, Federal guidelines encourage the establishment of: 1) capital reserve funds to pay for future expansion, upgrades or rehabilitation of the wastewater system; and 2) adequate operating reserves, called working capital herein, with which the wastewater system can meet its bill payment and emergency cash obligations. Previously conducted wastewater service charge studies for the City were also conducted considering the debt service payment and debt service coverage obligations of the City. 2001 COS Section 2 Page 8 October 10, 2001 Performance of the Wastewater Rate Study: The preceding subsection sets general guidelines for performing a wastewater cost of service and rate study that will meet EPA regulations. The guidelines issued by EPA provide more specific directions for allocating costs of service and structuring rates, and define many of the rules for performing a rate study—that meets EPA standards. The covenants of the revenue bond issues used to construct the City's wastewater system facilities must also be observed in developing the financial plan and revenue requirement portions of this study. It is an objective of this cost of service and rate study to observe the guidelines of the Federal grant program for a wastewater service charge system. Among those guidelines are the following: • Determination of annual revenue requirements. Annual revenue requirements are developed through performance of a financial projection of a 6 -year planning period (fiscal years 2000-2006). • Determination of annual debt service and coverage requirements, including desired deposits to capital and operating reserve funds. • Determination of costs of providing service for customer classes, as are defined by EPA regulations. • Appropriate development and application of capital fees to the payment of capital costs. • Development and design of appropriate wastewater service charges and other charges. To satisfy the above, the following grant program guidelines included in the regulations are observed in the performance of this study: • Wastewater service charges should provide for operating expenses of the wastewater system. • 2001 COS Section 2 Page 9 October 10, 2001 Operating expenses are defined as day-to-day operating costs of the wastewater system, such as treatment, pumping, transmission, collection, monitoring and administrative costs, and system replacement costs. System replacement costs include such expenses as costs of pumps, motors, telemetry and electrical controls, air scrubbing equipment, chlorination and dechlorination equipment, vehicles, radios, etc. Replacement costs may be determined by application of annual depreciation expense (straight line basis), or by determination of annual replacement costs projected for the next 5 -year planning period. System replacement costs are those normal repair and replacement costs that keep existing facilities running during norm& life expectancies. System replacement costs do not include major rehabilitation costs, structural rehabilitation, or expansions and upgrades to the system. Major rehabilitation costs, structural rehabilitation, and expansions and upgrades to the wastewater system are regarded as capital expenditures, in contrast to operating expenses, and are funded in part through connection and other capital fees and contributions. Capital (and connection) fees may n_ot be used to pay for wastewater system operating expenses, including system replacement costs. (In this manner, capital fees can be set at appropriate levels.) Capital (and connection) fees may be used to pay for annual debt service costs on financing obtained to construct facilities, or to establish capital reserve funds to provide for future facilities requirements. If capital fees do not appropriately recover capital costs, the burden of - .. •-. - - .1• .- expenses, falls on wastewater service charges In the development of a financial plan, it is the intent of this study to establish the reasonable and appropriate level of wastewater service charges and capital fees through which the City can continue its wastewater system operations on a financially sound basis and construct the required facilities that are needed to serve present and future customers. In addition to the preceding, the following additional guidelines are observed relating to cost of service allocations: 2001 COS Section 2 Page 10 October 10 2001 • Customer classes of service (wholesale and retail) will be identified in accordance with EPA regulations. These may include, for retail customers, subdividing residential, commercial and industrial customers into sub -classes of service, and separately costing large customers (over 25,000 gpd, or contributing more than 5% of total flow). Cost allocations will be performed by first classifying costs of treatment services to cost parameters (flow, BOD, SS, etc.) and second, by dividing the classified costs by annual loadings to obtain unit costs. • Costs of special treatment facilities constructed to process specific types of waste will be allocated to customers who discharge such wastes. • Costs of engineering, contingencies, and other miscellaneous capital costs may be prorated among the treatment cost parameters. • Administrative and other customer related costs will be identified and may be allocated to customers on the basis of numbers of accounts, or some other equitable basis. • Wastewater service charges must recover operating expense and replacement costs in proportion to total wastewater loadings on the wastewater system. • Industries, which reserve additional capacity in the wastewater system, must pay for the additional capital costs and operating expense associated with that reserved capacity. Financial Policies and Issues - Outside City Rates: Recent Proposals nn Wastewater Rates It is intended that the wastewater cost of service and rate study performed herein be a technical review of the operating and capital costs associated with running the City's wastewater system facilities as pertains to the determination of annual revenue and funding requirements, and 2001 COS Section 2 Page 11 October 10, 2001 allocations of costs of service to system customers for the purpose of determining equitable wastewater service charges and other fees. The City performed a user study for its wastewater operations in 1987 and 1988, aimed at determining the level of increases in wastewater service charges required to support proposed financing and other cost increases associated with the expansion of its treatment and collection system facilities. The City's engineering consultant, HDR Engineering, Inc., also prepared a Financial Planning analysis section as part of its Comprehensive Plan For Wastewater System study, completed in October 1988. This work was performed to describe the financial situation and costs faced by the City's wastewater system at that time and in future years with the expansions projects and to discuss possible sources of income, which included charges for services, grant funding for the City's proposed capital projects, and the issuance of financing to provide for the local share of project costs. The financial projection and plan performed in this study combines and updates proposals contained in the City's 1990 user rate study. In 1990, Yakima County took exception to the proposed increase in the surcharge rate applied to out -of -City (County) retail customers. The actual increase that was implemented for out -of -City retail customers was substantially less than the amount recommended in the 1990 Cost of Service and Rate Study History of Outside City Policy and Surcharge - County of Yakima Customers.. The City has an extensive history pertaining to the extension of City utility services outside its corporate boundaries. Early City policy (1965-1968) encouraged annexation to the City. It was recognized that some areas could not be annexed and fringe development often occurred without proper planning controls. In 1968, the City passed Resolution No. D-1250 that stated that property owners requesting utility services outside the City limits conform to City General Plan and development codes. In 1974, the City, County, Union Gap and Terrace Heights signed the Agreement for Wastewater Treatment and Disposal Service that granted Vcararin® +nntho, r,+v rosnnnsihili+v for providing uvas+oTwo+or VVI.IVV ..Arca IMnv times_ larger than had been previously served. In 1976, an Urban Area 2001 COS Section 2 Page 12 October 10, 2001 Agreement was adopted, which defined the obligations of the City and established the direction for the City to embark on an sequential annexation plan which recognized the provision of utility services to outside City (County) residents. The outside City surcharge had been in effect since before 1976 when the Urban Area Agreement was adopted. The City viewed the outside utility surcharge as an interim step in the provision of public services to outside City customers in that City customers are owners of the wastewater system and County customers are non -owners. The surcharge rate was initially set by using a figure of 50%, which appears to have been similar to what other Washington State wastewater utilities were charging. With the use of this surcharge, rates were set which represented, but never exceeded, the actual cost of serving this customer class. Fxisting City Policy on County of Yakima Retail Customers: With the adoption of the 1990 City report and as affirmed in the 1991 County report, the utility basis of accounting was reaffirmed to be used to determine the costs of providing service to County (non -owner) retail customers. The American Water Works Association (AWWA) recommendation for determining costs of providing services to outside City (non -owner) customers is that the utility basis of accounting be used to determine these costs. When the costs of service are defined using the utility basis of accounting for non -owner customers, the remaining customers of the utility system must pay for the remaining cash requirements of the operation. (Ref. Water Rates, American Water Works Association, Manual of Water Supply Practice, (AWWA M1) fourth edition 1991) Excerpts from the AWWA manual M-1 reflecting this policy are: • "The utility approach to determining revenue requirements is... an appropriate method for determining the costs of service applicable to customers served outside of the corporate limits by a government-owned utility." • 'The use of the utility approach can reduce controversy since it generally results in more stable rates, which are not so immediately affected by the level of system capital expenditures as are rates developed under the cash -needs approach". 2001 COS Section 2 Page 13 October 10, 2001 • "A publicly owned utility may be considered to be the property of the citizens within the City. Customers within the City are owner customers, who must bear the risks and responsibilities of utility ownership. Outside City customers are non -owner customers and, as such, bear a different responsibility for costs than do owner customers." • "The costs to be born by outside -City (non -owner) customers are similar to those attributable to the customers (non -owners) of an investor-owned utility. Such costs include operation and maintenance expense, depreciation expense, and an appropriate return on the value of property devoted to serving the outside - City customers. Cash Vs. Utility Basis of Accounting The cash basis of accounting determines the revenue requirement of a utility nn the basis of cash receipts and cash outlays as they fall due. The four primary elements of cash basis accounting are: • Operating Expense: Operating expenses are the costs of operating the wastewater system on a day-to-day basis, and include costs of operating and maintaining the wastewater treatment plant and collection and disposal facilities of the wastewater system, administrative costs, and system replacement costs. • Debt Service• Debt service consists of payments of principal and interest on short and lona term financing incurred by the wastewater system for major equipment purchases or construction of facilities, obligations to debt -service reserves, and coverage on bonded debt. • Capital C)utlays• Capital outlays consist of system upgrades or improvements to the wastewater system, or the purchases of equipment paid in cash generated from revenues or connection fees. = Taxes• Taxes paid to governing agencies, such as property taxes, gross receipts taxes, franchise or other types of taxes. Taxes may be characterized under operating expenses. 2001 COS Section 2 Page 14 October 10, 2001 Public utilities, such as the City's wastewater system, are public agencies, owned by their customer -users. Almost all customer owned public utilities set their revenue requirements using the cash basis of accounting. (See Table 2-1). The utility basis of accounting determines the revenue requirement (and rate level) using different cost elements than the cash basis. Debt service and capital outlays are replaced by depreciation expense and a rate of return allowance. Depreciation expense, as it enters into determining the utility's rate level, is a substitution for the principal payments made by a utility under the cash basis. The rate of return allowance (return on investment) is a reimbursement to the utility and its owners to pay for the interest costs on its debt, provide an allowance for equity payments which the utility uses to purchase capital equipment or facilities needed, and provide an allowance for a return on investment to be made to its owners for risking capital. The three elements of the utility basis of accounting are: • Operating Expense: Operating expenses are the costs of operating the wastewater system on a day-to-day basis, and include costs of operating and maintaining the wastewater treatment plant and collection and disposal facilities of the wastewater system, administrative costs, and system replacement costs. • Depreciation ExTnense' "Depreciation is the loss in value of facilities, not restored by current maintenance, that occurs due to wear and tear, decay, inadequacy, and obsolescence. The annual depreciation expense component of revenue requirements provides for the recovery of the utility's capital investment over the anticipated useful life of the depreciable assets. It is, therefore, proper that this expense be borne by the customers benefiting from use of these assets. ... The funds resulting from the inclusion of depreciation expense in the annual revenue requirement are the property of the utility and are available for use as a source of capital for replacement, improvement, or expansion of its system or for repayment of debt." AWWA Manual M1 Water Rates. • Rate of Return Allowance (Return on Investment)• "The return component is intended to pay the annual interest cost of debt 2001 COS Section 2 Page 15 October 10, 2001 capital and provide a fair rate of return for the total equity capital employed to finance physical facilities used to provide utility service. The utility approach of determining revenue requirements requires the establishment of a rate base, defined to be the value of the assets on which the utility is entitled to earn a return, and the fixing of a fair rate of return on the rate base. The rate base is primarily composed of the value of the utility's plant and property useful in serving the public. In addition, it is proper to include an allowance in the rate base for material and supplies, working capital, and construction work in progress. On the other hand, contributions in aid of construction and customer advances for construction are generally deducted from utility plant in service for rate -base determination." AWWA Manual Mi Water Rates. The rate base is the historical cost of investment in plant facilities Tess accumulated depreciation, contributions in aid of construction and grant funds). The setting of a rate of return for a utility involves consideration of the cost of outstanding debt, the market rates for dividend payments, and the amount of cash -paid capital required by the utility to meet its equity or equity growth requirements. Use of the utility basis of accounting to set rate levels recognizes the proprietary interest that owners have in the utility; in this case, city retail customers' ownership of the wastewater system. These owners have contributed capital to construct the facilities that benefit both themselves and other users. 2001 COS Section 2 Page 16 October 10, 2001 TABLE 2-1 CITY OF YAKIMA - WASTEWATER UTILITY CASH VS. UTILITY BASIS OF ACCOUNTING Cash Basis Operating Expenses* Debt Service -Principal Debt Service -Interest * Includes taxes Utility Basis Operating Expenses* Depreciation Expense Rate of Return Allowance - (Interest on Debt, Return on Equity Capital) The Utility Basis of Accounting in Use: When the utility basis of accounting is used, such as when the City uses the utility basis to set rates for County retail customers of the wastewater system, the City's intent is to collect for costs of operations and maintenance, depreciation, and a return on investment. The latter charges County customers for interest costs on debt, cash -paid capital outlays, and a payment to compensate system owners for contributed capital. The City's practice is to set revenue requirements using the cash basis. The City then deducts revenue anticipated from retail customers in the County and septage customers, computed using the utility basis, and the revenue anticipated from wholesale municipal customers (Union Gap and Terrace Heights) and wholesale industrial customers from total revenue requirements. After these deductions, the remaining cash requirements of the system must be paid by City retail customers. Flimination of a "Surcharge" Factor The City does not now use a surcharge factor. Prior to implementation of the recommendations of the 1994 COS, a "surcharge" factor was established and applied toward City retail wastewater rates to establish rates for County customers. Therefore, if the City rates went up $1.00 the County rates went up $1.00 (times) the "surcharge" factor. 2001 COS Section 2 Page 17 October 10, 2001 Under a proper Utility Basis method there is no such direct !ink between the City and County rates. The County rates are estahlished using the "utility basis_". The City rates are establisheth sing a "cash basis". At any given paint in time there will be a ratio (what has been called a surcharge factor), between the two. This ratio is not fixed. Rates established by a utility basis are governed by depreciation schedules that tend to be more stable then those established on a cash basis that can be subject to sudden cash requirement of the system. Depending on the amount of cash financing used and the term of debt repayment, this ratio could be less than 1.0.. Each time a rate study analysis is done, rates for retail customers living in the County must be calculated based on the ongoing depreciation schedule and are not subject to the short-term cash requirement of the system. In the event the City were to set rates for the customers living in the County using the cash basis, City customers would be deprived of compensation for capital used in the construction of facilities for others and compensation for assuming the risk in investing in facilities from which revenues are not guaranteed. Commencing in 1994, there was no longer any surcharge factor. Rates for all classes of customers are determined on a cost to serve basis Legal Responses to the County's Response to the Surcharge Prnnncal- The City engaged the law offices of Preston, Gates & Ellis, Seattle, Washington to review statutory and case law in the State of Washington relative to levying rates and charges on non-resident utility customers. The findings of these reviews are summarized as follows: • It is well established that a public utility may segregate non- resident customers into a separate rate classification and charge them higher rates. • Rates need not precisely reflect cost of service. However, rates for non-resident customers must be reasonable and rnacnnnhlenoce must be. judged rl nn cost of cervico os uIoll os 1 Vf..4VV1 I{AVI VI IVVV 11 I.AVl be. ,\/4y V4 VI, cost V. service KV •. V11 My other factors, such as location inside or outside the City. 2001 COS Section 2 Page 18 October 10, 2001 Inability to isolate the costs precisely, such as may occur by using both the cash and the utility bases of accounting, does not invalidate an allocation (of revenue requirements). The City is permitted to charge a return on investment to non- resident customers for the facilities used and useful in providing service to such customers. An investor/owner utility rate of return amount, or percentage, provides a useful reference. • The City is under no obligation to establish a specific reserve fund, nor is the City constrained to use the funds collected for depreciation for the sole benefit of non -owner customers. 2001 COS Section 2 Page 19 October 10, 2001 SECTION 3 CAPITAL IMPROVEMENT PROJECTS Wastewater Funds; The wastewater utility's finances are divided into four Funds; Fund 472 (Wastewater Facilities Capital Reserve Fund), Fund 473 (Wastewater Operating Fund), Fund 476 (Wastewater Collection System Project Fund), and Fund 478 (Wastewater Facilities Project Fund). Fund 472 Repair, Maintenance, and Minor Capital Expenditures During 2001-6, this fund will support a portion of the litigation expenses associated with the Wastewater System and an ongoing minor repair and maintenance projects at the wastewater treatment plant. These projects include rebuilds and industrial coating of plant basins and equipment due to the severe service requirements of the facility. The City, Union Gap, and Terrace Heights make capital contributions in proportion to their allocated treatment capacity (Yakima 87.9%, Union Gap 8.1%, Terrace Heights 4.0%). The total annual contribution totals $150,000. Other revenue is from interest on any reserve balance. Anticipated project expenditures are shown in Table 3-4. Revenues and total fund budget are shown in Table 3-1. Fund 473 Wastewater System Operations This fund is not a capital fund and is addressed in section 4 of this report. Fund 476 Collection System Improvements The proposed capital expenditures from the Collection System Improvements Fund, during the period 2001 through 2006, are for a portion of the Wastewater litigation expenses, rehabilitation of existing lines, extension of interceptors, and installation of neighborhood collection systems Without the proposed rate adjustment, none of these projects will be possible. Some of the City's major trunk lines are nearing 2001 COS Section 3 Page 1 October 10, 2001 capacity. Without enhancement of capacity, a connection moratorium 1101 •- —• :1111 II •af Table 3-5 lists the projects currently under consideration. The projects listed under Collection Piping include the installation of collection systems in low income City neighborhoods that have a history of septic failures. These areas include the Fruitvale, East Mead, and North 4th Street areas. A program has been developed through the City's Department of Community and Economic Development to financially assist the residents in these neighborhoods with sewer connections. This budget also includes some collection piping to fulfill City contractual obligations. The City was fortunate to recently receive notice that its application for a $1.5 million loan from PW T F was approved. This money will supplement $225,000 from CBDG Block Grant to provide water and wastewater service to several home in the area of 24th Avenue and Jerome. Council has already given approval to raise rates as necessary to meet this debt obligation. This increase is 2.0% applied to the Ready -to -Serve charge for all City retail customers. This budget also includes money for odor litigation expense. The plaintiffs have expanded their claims to include the collection system. The projects listed under New Trunks/interceptors include a City pipe along the Valley Mall Extension. This will provide capacity from development of the area South and West of the Airport. The remaining collection system projects are listed in the 2000 Facilities Plan. A summary is on Tables 1-12, 1-13, and 1-14. Of these projects, a total of $4,416,000 or 63% is mandated. The projects listed under : - u - •'- - 10 O. - • • relieve bottlenecks within the existing system. This construction will be required as flows increase from new customers served by a particular pipe. The City has budgeted full cost for these projects although a majority of these expenses should be recovered through the proposed Wastewater Connection Charge program. The projects listed under New Trunks/Interceptors will expand the area we are able to serve. Current City practice does not initiate any extensions of Trunks/Interceptors. The timing and initial financing of extensions should be driven by the development community or groups of homeowners. The City will participate with sizing and location of these extensions and may provide financial assistance by participating in the incremental "oversize" of the Trunks and/or through the creation of 2001 COS Section 3 Page 2 October 10, 2001 "reimbursable agreements". The actual percentage of City involvement will vary from project to project.. For this report. an average of 25% of 1- • • - . 1- ►-, 1. 1 - -. • • 1 • • • . - future City_exDense_ These City expenses should also be recovered through the proposed Wastewater Connection Charge program. With implementation of the revised Wastewater Connection Charge (WCC), limited revenue is available for system expansion (see TABLE 3- 2). For this report, staff estimates that 50% of all WCC revenue will go toward collection system construction. Staff also estimates that 20% of this 50% will be credited (paid) to developers under reimbursable agreements with the City. To assist funding these projects and retaining a positive reserve balance in this fund through the planning period, it is anticipated that a $2,000,000 loan or revenue bond will be obtained in 2003. Also, the City has budgeted an annual cash transfer into Fund 476 from Fund 473. Beginning in 2002, this transfer is increased to $500,000 per year. This transfer consists of a portion of the money collected for debt service coverage during the previous year (see TABLE 4-9) These transfers are ultimately and practically dependent on actual cash balance position with - -1 - -. •. -. 1 studies k- 1- 1 01 .. s• - .- •. •. .. The transfers, expenditures, and revenues for Fund 476 are recapped in Table 3-2. Fund 478 Major Treatment Facility Projects In 2000, City staff and HDR Engineering, Inc. prepared the 2000 Wastewater Facility Plan. This document looks to the capital and operations and maintenance requirements (including staffing) of the wastewater system to serve the area for the next 20 years. Submittal of a Council adopted Plan to Ecology is mandated under WAC 173-240. Approval by Ecology is required to allow the City to be eligible to compete for any Federal or State funding options. The guidelines for the Plan are also found in WAC 173-240. Indicated in this document are extensive investment needs over the next 6 - 20 years for Mandates, Renewal/Reliability, and Growth. Specific facility needs are listed on Tables 1-12, 1-13, and 1-14 of the Plan and 2001 COS Section 3 Page 3 October 10, 2001 are also listed on Table 3-4 of this report. The needs during the next 6 years alone are for the treatment facility ($13,800,000 -90% mandated). The ongoing litigation is_using all available resources from this fund that were intended for construction. Without the proposed rate adjustment, none of these construction projects will be possible. Without the mandated projects, the plant might fail to meet Clean Water Art regulations that could expose the City and elected officials to civil and n t may soon be required in the City's service area Compliance with federal and/or state mandatory regulations requires adequate funding sources regardless of ability to pay. Although the federal and/or state regulatory agencies sometimes provide partial funding for mandated improvements in the form of grants and/or loans, those resources have been drastically diminished over the last decade. As a consequence, the City of Yakima and the Yakima Regional WWTP will b wholesale retail revenues to pay a substantial be required to use Y�IIIVIGJa1G and retail revenues portion (as much as 90% or more) of the total cost either as cash or through debt payments. • - - -- - -- significant_ 1 IllI . 1. . 1I With implementation of the revised Wastewater Connection Charge (WCC), additional revenue is available for construction related to plant expansion. For this report, staff estimates that 50% of all WCC revenue collected will go toward Treatment Facility construction. To assist funding these expenditures and assist in retaining an adequate balance of funds during the planning period, it is anticipated that a $3.0 million !van nr revenue hnnrl will be obtained in 7nn2 A $5 n million PWTF loan is anticipated 2004 and another $5.0 million in 2006. In total, an additional $13 million is scheduled to be borrowed for deposit into this Fund. Also, City has planned for an annual transfer of $200,000 from Fund 473 into Fund 478 each year through the remainder of the planning period. This transfer is required as the local cash match for PWTF loans. This transfer consists of a portion of the money collected for debt service coverage during the previous year (see TABLE 4-9). These transfers are ultimately and practically dependent on actual cash balance position with respect to revenues received versus revenues anticipated in this or future studies. Neither Union Gap nor Terrace Heights contribute directly to this fund. They ri irrcntly arc rnntrihi itinn to our rloht Service C"verage paymente IIvJ vul1 II%IJ .4Iv vvIltlla/tJtIIIy av %#L l veva Service vvVvltAl�t# ruJIIIVIIL%J. Their contributions to Debt Coverage are credited the following year 2001 COS Section 3 Page 4 October 10, 2001 toward their allocation of local cash expenses related to projects financed by this fund. The projected transfers, expenditures, and revenues for Fund 478 are documented in Table 3-3. 2001 COS Section 3 Page 5 October 10, 2001 TABLE 3-1 FUND 472 Wastewater Treatment Facility Reserve Description 2000 2001 2002 2003 2004 2C)05 2006 Cash Balance Forward 1,015,538 761,802 481,802 255,892 318,687 334,621 351,352 REVENUE City of Yakima (Trans. from 473 Fund) 131,850 131,850 131,850 131,850 131,850 131,850 131,850 (Debt Service Coverage/rates) City of Union Gap 12,150 12,150 12,150 12,150 12,150 12,150 12 150 Terrace Height Sewer Dist.6,000 6,000 6,000 6,000 6,000 6,000 6,000 Interest Income @5% 30,000 20,000 170,000 24,090 174,090 12,795 162,795 15,934 165,934 16 731 166,731 17 568 167 568 Total Revenue 180,000 Total Available Funds 1,195,538 931,802 655,892 418,687 484,621 501,352 518,920 EXPENSES Treatment Plant Improvements see TABLE 3-4 314,145 450,000 400,000 100,000 150,000 150,000 15Q000 Fund Balance -End of Year 881,393 481,802 255,892 318,687 334,621 351,352 368,920 F or minor ca•ital outla s for the treatment facility. _ Fund 472 may be used for Targe maintenance expenditures 9/17/01 TABLE 3-2 FUND 476 Interceptors/Collection System Improvements Description 2000 2001 2002 2003 2004 2005 2006 Balance Forward 1,979,810 1658601 1,291,245 659 357 1,959,803 1629662 294,387 REVEL Interest on Investments 104,114 75,000 64562 32,968 97,990 81,483 14,719 Gain on Investments 0 0 0 1 000 1,000 1 000 _000 Transfers from Fund 473 200 000 40,000 50000 500,000 500,000 500,000 500,000 Contribution (Housing prof 1918) 225,000 PWTF proj 1918 (24th & Jerome) 1500,000 Bond Proceeds (Apple Tree) 0 600 000-- _ Contribution (Apple Tree) 40,000 160,000 Transfers from Connection Charges 1221802 151,000 158,550 166 478 174,801 183,541 192,719 Line of Credit ($2.0 mill) 2,000,000 PWTF Existing Loans Proj 1616/1795 (Lincoln/N. 1st.) (350,383) total Revenue 116,533 1,611000 2,223,112 2,700,445 773,792 766,025 708,438 Total Available Funds 2,096 343 3,269,601 3,514,357 3,359,803 2,733 594 2,395 687 1,002,825 EXPENSE _ `_ 604,175 398 650 Collection System Construction See Table 3-5 437,742 1,978, 56 3855 000 1 400,000 1 103,932 2,101,300 Fund Balance -End of Year 1,658,601_ 1,291 ,245 659,357 1959,803 1,629,662 294,387 Fund 476 may be used for system wide Comprehensive PlaTnning and Collection system construction and improvements including Intercepters_. I}- ' Assumes 50% of Connection Charge credited to 476 Fund, 50% to 478 Fund. Of this 50%, 20% is assumed to be returned to developer through reimbursable agreements. 10/9/01 TABLE 3-3 FUND 478 Wastewater Treatment Facility Description 2000 2001 2002 2003 2004 2005 2006 Balance Forward 1.070.358 850.667 79e^7e7 2.711.e96 2,206,865 3.e52,116 2 443 008 REVENUE Interest from Investments 41,419 15.000 39,839 0 135.585 110,3*3 0 197^608 0 122.150 0 Gu|nnn investments 0 0 0 Interest from Contracts 3^420 5.000 5.000 5.000 5.000 5,OVO���� Transfers From Fund 473 0 200.000 200.000 200.000 ou818 200)000 33,127 e7,083 3,197 200,000 33.018 66.862 3.164 200`000 32,ee3 66 750 3.168 Debt CmmvogeTH 3e.412 38.e10 37 081 Debt Coverage UG 77,785 78.185 75'090 e6.456 3.132 Debt Coverage UG/RR 3.122 3.124 3.14e Transfers from Connect(on Charges (473) . 122.802 151.000 158,550 166.478 174,801 18u.541 1.500 192.719 1.000 CCM 15.153 12.000 3,000 2,500 ------ !,soo De| Monte Reimbursement <164/> 0 300,000 25,000 Del Monte Settlement 3 350,0000L 75.200 75.200 75.200 —'--- 75„200 75,200 75,200 Det Monte Wastewater Conversion _ -----' |nterfund loans/Line cd Credit 710,000 710,000 |nterfund loans/Line ofCredit . 3.000,000 PmTFLouno 5'000,000 5.000.000 Total Revenue � 302.113 1.938./1e *.331'e09 687,168 5.670,252 765'891 5.6e8.950 Total Available Funds 1,372,471 2.788 786 5,128.896 3,398 865 7.877'116 4.718.008 8,141.957 EXPENSES Treatment Facility See TABLE 3-4 521.804 1.991.9e9 2.417.000 _1 1e2.000 3.925 000 2,275,000 5.101.200 Fund Balance -End ef Year . 850.887 796.787 2.711,696 2,265 3,952 116 2,443,008 3.040.757 Fund 478 may be used for planning for and maim capital �ects on the Treatment Facility 10/9/01 TABLE 3-4 Wastewater Treatment Facility Capital Improvement Protects CI t ELEMENT Fund Estimated Total 2000 2001 2002 2003 2004 2005 2006 7-12 13+ Pro ect 4 __ Total Cost Through 2006 FUND 472 1825 Plant rehabilitation 1998 472 839 145 $39,145 $39 145 1854 Odor MI akin 472 472 472 472 8700 000 8181,000 $350 000 $444,000 $700,000 $181,000 $100,000 x $165,000 80 $10,000 $300,000 $16,000 $100,000 $34,000 $300,000 850,000 $50,000 $50,000 $50,000 850,000 $100,000 $50,000 $100,000 $50,000 $100,000 1917 8A Aeration Basin M4 Repair 0000 Minor Ca.ital Improvements Equipment Replacement $350 000 $444,000 0000 ■ Subtotal 472 $1 714,145 81 714 145 $314145 $450,000 $400„000 $100,000 $150 000 8150,000 $150 000 includes THBUG ■ FUND 478 ■ In Addition to Facilities Plan 0000 Professional Services 478 $140 000 8140 000 80 $15100 $10,000 825,000 $25,000 $25 000 825 000 $25,000 1638�Headworks/Di.ester 1640 U•. rade Facilit Plan 478 817 650 817 650 _ $7,650 478 478 8111 695 8283 799 8111 695 8283 799 $86 695 8178 799 825 000 880 000 1641 1824 1854 _ _NPDES Spraylield Engineering Report 825 000 Mandated Construction Odor titl.atton 478 478 82 000 000 81 211 564 82 000,000 $0 8500 000 8500 000 $500 000 8500 000 81 211 564 $211 564 8450 000 8550,000 1884 478 $29,095 $29,095 $29,095 ■USTRemoval Subtotal 478 83 793 803 83 793 803 8513 803 8580 000 8600 000 $525 000 8525 000 8525 000 8525 000 1942 FROM FACILITES PLAN DN Monts Conversion _ FWWTP 7B Tricklln. Filter Mechanisms 478 8650 000 8650 000 88 001 8641 999 � FWWTP 7D TF Clarifier solid removal 478 8425 000 8425 000 $425 000 ---- FWWTP 70 TF Clarifier .ales 478 850 000 850 000 00 850,000 FWWTP 7D TF Clarifier Effluent Pumping 478 $652,000 $652,000 $345,000 $307,000 1942 Subtotal Del Monts Conversion 81 777 000 81 777 000 88 001 81 411 999 $357 000 ----- 850 000 - Other----- 478 850 000 -© FWWTP 1 Influent Buildin. FWWTP FWWTP FVNNTP FWWTP FWWTP FWWTP FWWTP FWWTP 2 3 4A 48 7A 8A Emer.en Generator Prima Clarifier Mech. Prima Stu..e 478 478 478 478 478 478 478 478 $100 000 8400,000 8240,000 810 000 8100 000© 8250,000 885,000 Above 8100 000 8200 000 - $10 000 ©--_-- --- $100 000 8100 000 8100 000 200 000 _ _- 8240 000 CatllW' li •LigLuatuiplutIL. Slud.e Transfer BI... Intermediate De.ritter wall Tricklin. Filter Walkwa s Aeration Basin *4 Re air 810 000 . 8 100 000 885,000 © 8250 000 855 000 830 000 i __ FWWTP 88 Blower VFD's 2/4 478 $490,000 $245,000 8145 000 8100 000 8245,000 FWWTP 8C A- Basin Diffuser Rehab 478 850,000 850,000 850,000 FWWTP FWWTP m Seconda Clarifier Bull Gears 478 8120,000 8120,000 _ _ _ $60 000 860,000 Seconda Clarifier Launders 478 8257,000 8257,000 $100,000 $100,000 8157,000 $262,_000 FWWTP 9C Seconda Clarifier Skimmer/Scum 478 $362,000 8362,000 __ __ FWWTP FWWTP 10 70 DA .I . .)(:3.7<f.]lly.:. Secondary ClarifierSpra nozzles 478 478 8267,000 815,000 $267,000 $15,000 $267,000 _ $15,000 8203,000 FWWTP 11A 2nd DI ester recirculation •um 478 $203,000 _. FW,NTP 118 Flare 478 860 000 60 000 FWWTP FVVWTP 14 15 Seconda Clarifier Evaluation Miscellaneous Im•rovements 478 478 850,000 $1 000 000 850,000 8200 000 --- 850 000 $100 000 850,000 $500.00 $400,000 8400,000 10/9/01 page 1 of 2 TABLE 3-4 Wastewater Treatment Facility Capital Improvement Protects City ELEMENT Fund Estimated Total 2000 2001 2002 2003 2004 2005 2006 7-12 13+ Project Total Cost Through 2006 WWTP 1 Septage receiving 478 478 478 $2,079,300 5312,100 5870,500 5100,000 x x x $100,000 5212,100 52,079,900 WWTP 2 Grit Hopper Storage Primary Split box WWTP 3 $870 500 WWTP 4A TF media replacement 478 50 x WWTP 4B TF ventilation 478 478 478 478 478 478 51,066,100 $1,669,400 53,277,800 52,480,00(1 $4,366,600 $1,095,600 51,669 400 53,277,800 x x x x $400,_000 $600,000 $1,269,400 $2,677,800 $1,066,100 $2,480,000 54,366,600 5547,800 53,931,100 $1,338,800 $1,912,700 $3,412,800 5976,200 $1,000,000 $150,000 5547,800 __ _ $4000 "coo WWTP 5 RAS/WAS Pumping WWTP 6 New Secondary Clarifier WWTP 7A Anoxic Selector WWTP 7B Aeration Basin (2.1 mg) x x WA/TP 7C New Aeration Blower WVVTP 8 U.V. Disinfection 478 53,931,100 x WWTP 9 WAS Thickening 478 478 $11 338,600 $1,912,700 x x WWTP 10 Centrale Pretreatment WWTP 11A Solids Building 478 53,412,600 x VWVTP 110 New Centrifuge 478 478 51,345,000 $976,200 $1,345,000 x x $1,345,000 WWTP 11C Polymer System, WWTP 12 Laboratory modification 478 51,000,000 x W4,TP 13 Blosollds Truck Storage 478 478 $400,000 5150,000 $400,000 53,100 000 x x x x $400,000 53,100,000 WWTP 14 New boller/hot water WWTP 15 Mesophilic Digestion 478 478 $4,000,000 53,100,000 WWTP 16 Blosolids Handling Subtotal Facilities Plan (478) $44,669,600 __$13,630 200 x 58,001 $1,411,999 $1,817,000 $657,000 53,400,000 $1,750,000 54,576,200 522,698,800 522,698,800 58,340,600 58,340,800 Total Facilities Plan (472+478) $44,850,600 513,811,200 x $173,001 $1,427,999 51,817,000 5667,000 53,400,000 51,750,000 54,576,200 TOTAL 478 548,463,403 517,424,003 5521,804 $1,991,999 52,417,000 51,132,000 53,925,000 $2,275,000 55,101,200 522,698,800 $8,340 600 Includes TH&UG _ 10/9/01 page 2 of 2 TABLE 3-5 Collection System Improvements CI Fund Estimated Estimated 2000 2001 2002 2003 2004 2005 2006 7-12 13+ Pr• ect Description Total Pr• ect Ci cost t Cost tuou•h 2006 Collection Piping (4 12") and Com • ehenalvs P annin 0000 Ne). boyhood 3 stem Pr••ram . 5550 000 5550,000 50 SO 5150,000 5100 000 6100 000 6100 000 5100 000 5600 000 5700 000 0000 Collection S stem Im• moments Comprehensive Plan 476 5821 504 476 574,102 $82( 04 574_102 589,371 69,504 650,000 550 000 5250 000 5262 000 5100 000 9100 000 5600 000 9700 000 $49,102 $25 000 _1644 1817 S 72nd 8 Washln•ton 11E3 $82,271 . S45 776 13511 51 715 Ini 5120 000 11371 590,000 476 3150,000 589,371 1819 1820 Connection Cher•e LA dal N72nd Side lines 545,776 51 715 5120,000 5776 525,000 $20,000 53515 151,800) 520,000 520,000 615 000 5150 000 $20,100 515 000 $212,000 515,000 520 000 515 000 520 000 515,000 5120,000 590,000 6140,000 6105 000 1838 Manhde Rehabilitation SO 1839 Root Control 590 000 SO 511„000 1854 Odor Litigation 9150,000 1858 Stonehedge 476 1545,020) 154.5,020) 872 (945,100) 5744' $1 500 000 -� --� -� 1859 TINon Drive Extension 476 528,105 $28,105 528 105 526 740 916,338 5378 1883 LID 858h Ave. 476 926 740 476 515 594 476 5378 526 740 515 594 6378 1885 2810 Ave 8 Tieton 1889 Lakeside Lilt station 1902East Viola 476 522 989 476 51 725 000 476 9100 483 . 650 000 476 6100,000 525,000 81 725,000 5100 483 550 000 5100,000 ' 522 989 11111=011 ■- 5225 000 191816 24th and Jerome 1926 Fruitvale 595 000 950 000 $100,000 -_ -- 1918 South Ist Skeet SSO 8eedn St Un Station Subtotal Collodion 476 52 595 226 --II E- 92 595 226 $252 374 5557 356 ----_- $1 905 000 5385 000 -_-- 6397 000 5235 000 5235 000 $1 410 000 St 645 000 _ New Trunks/Inter - . tore 1795 Nath 1st St. Exbndon 476 $271 6271 5271 1870 Valley Mail Extension 476 61,067,525 51,067,525 517,525 6100,000 5450,000 5250,000 9250,000 51 067 796 51 067 798 5,796 $100 000 5450 000 5250 000 5250 000 FROM FACIES PLAN 1YmY edI.Existing system 1911 SSES/HYDRA (1.11.5 476 5240 000 6240 000 $150 000 990 000 ® ® 1.11.4 Existing system for exis8n • flows . 5694,000 5694,000 5100 000 $2.Z✓0 000 8100 000 5100 000 8144 000 Eosiing system for p• soled UA stows . 51 173 000 51 173 000 - 5250 000 8300 000 9250 000 5200 000 9173 000 Existing system for ppjecbd UR Bowe 476 67,608,000 $1,316,300 51,316,300 58,291,700 1.11.5 Additional ColloWon Facilities 476 63,257,600 50 $3,257,600 Subtotal Upetze Existing 512,972,600 63,423,300 90 SO 5500 000 5640,000 5350,000 $1,616,300 5317,000 59,549,300 --. a 5167,572 91,321,000 ---- 1.11.3 New Trunks Ahtanum/Applo Trim Extension Subtotal Now Trunks 91.488 572 51,488 572 6167 572 51 321 000 N 25%-�-- f0 Mlocadon Estimated New Trunks/Intrceptae •• City CASH 91 92y728 50 50 53,266,607 $1,870,925 Suntdes/Nadws River !dor • •tor 476 57 091,300 a 51,500,000 9427 728 St 6694 965 51 171,575 52,645 _,.885 5368035 $2.067,980_ Cowiche Canyon Interceptor 476 53,046,500 476 SI 810 700 a x .. --- --- 6208 700 Wide Hollow Basin tnterc. •tor 52 164 815 5917,665 $11691968 Cootedge Basin Interc. • a 476 51,501,100 476 53 759,928 6208,700 50 x a Wile Intone. • or Mr•• t West 84410 . 54 820,500 SO a 52,471 265 5256,955 1,235 5345,045 Airport South Basin 476 S602 000 50 x Subtotal New Trunkeintweepta1•• 525,632,028 52,136,428 SO 50 50 5) 500 000 5427728 50 5208 700 512,642,200 510,844,700 _ CCITY all CASH Shw."25% - 96,408,007 50 SO 5375 000 5106 932 50 552,175 51j131)„,550 522091,500 $2,711,175_ 510 844 700 Ell Mill540 093,200 -80 TOTAL FacNIIbs Plan Construction TOTAL CITY CASH New Construction 476 824 532,201 11111 -- EN Is that financing and crostructcn Wilt* 9437 742 --- handled by the 01 978,356 private dove; 52 855 000 • 61 400 000 11003 103 932 52 101 300 _ 5604,175 551,119,850 $4,356,175 _ _ _ _ _ •• Current Cly policy for New TrunksAntxceplas The CI ma •arid• -te with the Incremental cost to 'oversize' the sever pipes, reimbur *mint agreements, a possible waivers may add to the city. overall Inandal commitment. For this report, the Ciys nM .1)00.900 s assumed to be approalmatel 25% of total • • ect cost The actual dmin• of construction of extensions WYl be driven by Me development community or gra of hone owners The City will par8cipate with design of sizing and location I 1 1 1 10/9/01 Table 1812.0=6 Year Priority Im Improvement Numbers FWWTP-2 FWWTP-3 FWWTP-4B FWWTP-7A FWWTP-7B FWWTP-SA- F W WTP-8B FWWTP-8C FWWTP-9A FWWTP-9B FWWTP-9C r ,. wTr-!u 3 FWIPTP--7D FWWTP-7D Opinion of Facility Description Probable Cost E Gmera� ovedutdeseteennere Emery Clarifier CoBeaten Mechanizes (2 o4 5100000 4) S200.000 PAY Sludge Pumping Lighting 510.000 Triddmg Fiber Door/ Walkway Caves 185.000 Tag filler M (Both) S650.000 Repair Existing wa>a� w.. " � --- � 1181.000 Blwers(2of4) 1245.000 Aeration Basin Diffusers Kebab $50.000 Refurbish Secmday CJaifer Bull -Gears Replace Sem Clarifier Exterior launders Replace Secenclary Clatifm• Skive= MaharaNSptm Box DAY to Air CommessonliPalima Trickling Filter Clarifier Solids Roamed System atewrueyag Trickling Filter Clarifier Gores Trickling Filter Ffjlueru Pumping Station tea' Ti Clarifier Spray Nozzle inrtallaoan FWSiTP.l4 Secmlay Clarifier Evaluation FWWIP-15 Miscellaneous Improvements Subtotal FWWTP W W TP -2 Gnt Storage Hopper WWrP-5 New RAS/WAS P. Sntitr, WWTP-1 /B improvements 5120.000 5257.000 5362.000 1267.000 314000 3425.000 350,000 3652,O00 311.000 550,000 5200.000 rovement Pro Mandatory' ecus Rev lations 5181.000 5245.000 550.0001 110,000 i50.900 550.000 Renewal /Safety 5100.000 5200.000 510.000 585.000 5325.000 5120.000 5257.000 5362.000 Growth2 1323.000 5267.000 De cted from Plan Ddeted from Pian Moved from 13.20 yr 3425,000 Mowed from7-11 yr Adda Added 53.919.000 W WrP-6 W WTP-13 WWTP-16 New Ce nmfitge New Sway Clarifier Turk Storage BiatolidS Handling Snlbtota!'%'WTP Improvements 5100.000 51.669. t. 1.345,000 5526.000 51.669.400 53.277400 13277.800 1400.000 5400,000 53.100,000 53.100.000 5200.000 51.926.000 5100.000 350.000 3652.000 315.000 51.467.000 $1,345,000 Mowed from 7-12 yr • 59.892.200 �.r.nt-treatment Plant [mprovemean Collection ModeleMonnoring Section 22 _....... Collewon Facility Table 11.11 Collection Facility Table 11-13 & 11-15 Collection Facility Table 11-14 (207.1 Subtotal Collection Facility TOTAL TREAThIENT/cQ1_t rr_ KIN • leattcacactus to ("rowel rented issues 42.0.859,500 a Compliance Wltn feoera(state favus and regulabons, and the Four Party Agreement ` Non -mandatory grow ri /system exganaion. • 30% Manoatory, 70% Growth italics nem a wean 0tWg11(lOnV8/0 513.811.200 5240.000 5694,000 52.489.300 53.625.000 57.048300 58.447.200 S I 58.973200 53371.000 5240.000 52300.700 5694,000 51.173.000 51.467.000 31,316,3001 52.548.700 51.867.000 51316300 52.632.600 S11.521.9001 55.238.000 54.099.600 Table 1-13.7-12 Year Priority Im Improvement Numbers FWWTP.1 FW WTP-3 FWWTP-5 FW WTP-6 8 rww-rr 7D FW WTP-8B FWWTP-110 FWWTP-15 Subtotal FW WTP WWTP-2 WWTP-7C WWTP-4B WWTP-7A WV/TP-7B WWTP-8 WWTP-9 WV/TP-10 WWTP-1 IA WWTP 110 WWTP-11C WWTP-12 WWTP-14 Facility Descri tion Latent Building Pnmaty Clarifec Collection Mechansrms (2 of4) Sludge Transfer Balding Refurbishment Replace Intermediate Grit Box Center Wan Replace Blotter VFD's (2 of 4) Install Secondary Digester Gas Flare Miscellaneous Imtpovemmts Improvements Grit Storage Hopper Additional Blower Trickling filter Media Replacement Trickling filter Forced Ventilation Anoxic Selector Cells Aeration Basin (2.1 mg) UV Disinfection WAS Thickening Ceauate Pretreatment Solids Building Polymer Sy Laboratory Modifications New Boiler/hot water Subtotal WWTP lmorovements TOTAL Treatment Plant Improvements Collecnon Facility Maintenance Bldg Collection Facility Subtotal Collecnon Facility TOTAL TREATMENT/COLLECTION * indicates oenents to Gmwm related races Crunpbance with federal/state laws and regulations, and the Four Party Agreement Non -mandatory growth /system expansion. • 30% Mandatory, 70% Growth Table 11-15 (inc only)' Section 11 Table 11-14(40%)3 Opinion of Probable Cost R lations rovement Pro ects Mandatory 550.000 5200.000 3100,000 3250,000 1391.304 150,004 5245.000 560.000 5400.000 51.305.000 5212.100 5547,800 61,699.304 51.066.100 52.480.000 54366,600 53.931,100 51.338.600 51.912.700 53.412,600 44•389400- 5976.200 1.589,104 5976.200 51,000,000 5150.000 521393.800 522.698.800 26291.700 53.257.600 312.642.200 522.191.500 5200.000 Renewal /Safety 550,000 5200.000 5100,000 5250,000 639.34104 660,004 5245.000 560.000 5200.000 5200.000 51.105.000 52,480.000 53.931.100 S 1.338.600 51.912.700 53,412.600 11.589,104 5976.200 51.000.000 515.051.200 515.251.200 52.282.400 52.606.100 53.792.700 38.681200 S2I2.100 61,6994104 51.066,100 Growtb2 Moved to 0.6 yeah Moved to 0.6 yeah 5547,800 Deleted doe to testing done daring Fall 2000. Moved to beyond 2020 unless media pings at loads > tested • • • 54366.600 Moved to 0-6 yr as existing Bird Centrifuge bas failed threfore no redundancy • 5150.000 51.428100 52.533.200 54.914.400 544.890300 323.932.400 32.533.200 54.914.400 34.009.300 3651.500 58.849.500 513.510.300 318.424.700 • Indicates benefits to Growth related issues Compliance with federal/state laws and regulations, and the Four Party Agreement ' Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth a auac i -1''i, 13—SU %ear rnonty improvement Projects Mandatory' Improvement Opinion of Renewal Numbers Facility Description Probable Cost Regulations /Safety Grow& FWWTP-4A Primary Sludge Pumping FWWTP 7D Density and Fin.,, .,..! 5240,000 5240.000 Selid Rem j Systeu14)eg 542000 542-5,880 Moved to 0.6 yews Add Secondary Digester FWWTP-11A Re!Mutation Ptunps 5203,000 5203,000 FWWTP-15 Miscellaneous Improvements 5400.000 5400.000 Subtotal FWWTP Improvements 5843.000 5843.000 WWTP-I Septage Receiving Facility 52,079,300 52,079,300 WWTP-3 Primary Split Box S870,500 5870,500 WWTP-7C Additional Blower - 2nd 5547,800 5547,800 WWTP-15 Mesophilic Digestion 54.000.000 54.000.000 Subtotal WWTP Improvements 57.497.600 52.079.300 5870.500 54.547.800 TOTAL Treatment Plant Improvements 58340.600 S2.079.300 51.713.500 54.547.800 Collection Facility Table 11-14 510.844.700 53.253.400 57.591.300 Subtotal Collection Facility 510.844.700 53.253.400 50 57.591.300 _ TOTAL TREATMENT/COLLECTION 519,185300 55.332.700 I 51.713,500 512,139.100 • Indicates benefits to Growth related issues Compliance with federal/state laws and regulations, and the Four Party Agreement ' Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth SECTION 4 OPERATION, CAPITAL TRANSFER, AND DEBT SERVICE EXPENSES Operation Expense: Fund 473 contains the system operating, capital transfer, and debt service expenses. Operation expenses are the day-to-day costs of operating and maintaining (O&M) the sewerage system. The City categorizes its O&M expenses by service units (SU) which reflect functions performed by the wastewater division on the City's wastewater and storm sewer systems. All of the Wastewater Department's O&M activities fall into one of the following service units: SU 211 SU 213 SU 215 SU 232 SU 233 SU 234 Collection System Storm Sewer Rudkin Road Pumping Station Domestic Treatment Facility Pretreatment Monitoring Program Food Processing Wastewater (discontinued) Applicable related expenses for the wastewater system are included in the preceding functional categories, such as vehicle and fleet maintenance charges. Each service unit is charged with an interfund transfer amount for City Services, this covers wastewater system related expenses incurred by other City Departments such as payroll, legal, and finance. SU 211, SU 233, and SU 234 are charged with an interfund transfer amount for Customer Services, which pays for the cost incurred by the City Customer Services Department, which collects account consumption information and processes the retail customer billings. In projecting operating expenses during the planning period, it is necessary to recognize that expenses of the wastewater system will escalate in response to 1) additional Federal and State mandates which we are required to accommodate; 2) growth in the service area; 3) increasing billed flow rates; and 4) inflation. The escalation factors adopted for the financial projection of the service units are based on the assumptions that costs for some service units will increase within a range of 5.0%-10.0% per year due to foreseeable additional mandates, 1.5%- 2001 COS Section 4 Page 1 October 10, 2001 3% per year as a result of service area growth, and will increase by 3.0% per year due to cost inflation. A combination of these is applicable to each service unit. Each of the service units of the wastewater utility contain operating expenses for personnel salaries and benefits, office and operating supplies, fuel consumed, small tools, chemicals, professional services, communications, transportation and training, advertising, rents and leases, public utility services (primarily electricity), repairs and maintenance, miscellaneous expenses, state taxes, residual equity transfers (RETs) (purchase additional rolling stock), machinery and equipment repairs, interfund rentals/leases (sinking fund for equipment replacement), City services (pays for support from other city departments), and customer services (pays for billing of retail accounts). Prior to projected operating and maintenance expenses for the City's wastewater system, past O&M expenses worm rev!ewed to identify ••QJIG•�11QlGl v..+.e•� viwrv�.vvv whether expense categories were increasing, decreasing or remaining at about the same level. This information was tempered with what we foresee for upcoming mandates related to Storm Water, Domestic Treatment, Pretreatment, and Industrial Waste. Provision for expenses for professional services, advertising, insurance and bonds, and prior pensions have been made relative to past expenditures for these categories, and they are not escalated by a fixed percentage per year. • Portions of the City's existing capital facilities for the wastewater system were constructed using revenue bonds. In exchange for the use of funds, to construct treatment plant and other system facilities, the City makes annual debt service (principal and interest) payments on its revenue bond issues. When the City issued revenue bonds, it covenanted to provide -� • • r-_. -n - n i ••.-rat'n•. l •- wastewater system for the payment of principal and interest on all parity •••• - . • • - - I• .u• 1 ••• -a due in the same year The City's bond covenants require that the operating expenses and debt service must be paid before transfers of money to any other funds of the System can be made and before City utility taxes are transferred to the City general fund. Rnnri ratinnc aro a mainr fartnr in riotarmininn interact ratac nn hnnd issues, and reductions in debt service coverage for sustained periods of 2001 COS Section 4 Page 2 October 10, 2001 time can jeopardize favorable bond ratings, which the City has enjoyed in the past. The debt service coverage ratio, computed via the covenant provision expressed in the preceding paragraph, is used by rating agency analysis and investors as one of the primary indications of the financial strength and security of the utility. Adequate debt service coverage is also important to the sewer utility as a source of cash flow. Funds left over after payment of operating expenses and debt service obligations provide needed cash for repairs and replacements to the sewerage system, or for normal capital outlays, or early retirement of debt. On the advice of its financial advisor, and in the interest of obtaining the lowest possible interest costs on its financing, the City has an nhjective to obtain minimum debt service coverage of 2.0 This debt service coverage of 2.0 is applied to the revenue bond and State Revolving Fund Loan annual payments and is shown on the enclosed tables. To maintain this 2.0 coverage, rates must be set to generate net system revenues (in excess of the City's annual O&M expenses) in an amount equal to twice the amount of debt service due in the same year. The following year, the excess revenue generated through maintenance of this coverage ratio is applied to the capital portion of the service units within the 473 Fund. As shown on TABLE 4-9, this monetary infusion offsets nearly 100% of the scheduled transfers from the 473 Fund to the Capital Funds The City has also been fortunate in obtaining low interest loans from other sources. We presently are making debt service payments on nine loans from the Washington State Public Works Trust Fund (PWTF) and one from Washington State Department of Ecology State Revolving Fund (SRF). Capital expenditures also include cash transfers to the capital funds (472, 476, 478 as shown on TABLE 4-9) and Residual Equity Transfers (RETs). RETs include payments to other city departments for wastewater's portion of a capital expenditure and purchases of additional or replacement rolling stock. Total System Expenses: Operating, capital, and debt service expenses and coverage are allocated to the appropriate service unit. Historical and projected expenses are discussed below and shown on the following tables. 2001 COS Section 4 Page 3 October 10, 2001 SU 211 Collection. Section 10 of the 2000 Wastewater Facilities Plan identifies the needs of the collection system. In consideration of the objective of a mandatory preventative maintenance program for the collection system to: anticipate problem areas and initiate action before any problems occur; to reduce potential claims for damages resulting from system failures; and in avoidance of future liability costs, an increase of 6 full-time staff positions and equipment is recommended. This report allows for the addition of three two person crews and necessary equipment. One each in 2002, 2003, and 2004. As shown on Table 4-3, budgeted operating expenses of $1,802,591 for 2001 for the collection system are projected to increase by 2.7%-19% per year during the planning period. With the addition of the additional staff, expenses are projected to increase to $2,942,433 by 2006. Collection system expenses represent about 30.28% of total 2001 operating expenses of the sewerage system_ This increases to 36.86% by 2006. Capital and debt service expenses include the collection system's share of the outstanding '78/96 revenue bonds, transfers to capital budgets (476), and PWTF debt service payments for collection system construction projects, and residual equity payments on new vehicles and collection system's portion of two street construction projects. This report also anticipates a $2,000,000 loan to assist financing necessary interceptor construction during the 6 -year period. SU 213 Storm Drainage: The wastewater utility is currently delegated the responsibility of operating and maintaining the City's storm sewer system. Storm Drainage does not yet have any dedicated, unique funding to City retail wastewater customers As shown on Table 4-4, budgeted operating expenses for the storm sewers of $167,683 in 2001 are projected to increase by about 3% per year in the planning period, reaching $210,667 in 2006. These expenses anticipate the status quo in activity related to Storm Water during the planning period. These expenses represent less than 3.% of total current operating expenses of the sewerage system. The storm water service unit does not presently have any debt service obligation. 2001 COS Section 4 Page 4 October 10, 2001 Due to Federal Mandates_ costs associated with the storm water system will increase dramatically in the years to come_ Costs associated with this service unit may be _covered by revenue from a Storm Water Utility, SU 215 Rudkin Road. The City separately budgets for the Rudkin Road Pumping Station. This is the system's only major lift station. It serves the City of Union Gap and City and County retail users in the southern portion of the service area. As shown on Table 4-5, budgeted operating expenses of $83,879 for 2001 for the Rudkin Road pumping station are projected to increase by less than 3.0% per year in the planning period and are projected to increase to $100,234 in 2006. We do not anticipate any increase in service level of this area during the planning period. These expenses represent about 1.3%, of total current operating expenses of the sewerage system Capital and debt service expenses include Rudkin Road's share of the outstanding '78/96 revenue bonds. SU 232 Treatment Facility: As shown on Table 4-6, budgeted operating expenses for treatment plant operations of the City for 2001 are $3,248,766 and are projected to increase by less than 3.0% per year during the planning period and are projected to increase to $3,910,956 in 2006. This increase anticipates no change in overall staffing level during the planning period. However, any remaining expenses related to the sprayfield have been moved to this service unit. Treatment plant operating expenses represent about 54.58% of total 2001 operating expenses of the sewerage system. This decreases to 48.99% by 2006. Capital and debt service expenses include the treatment facility's and sprayfield's share of the outstanding '78/96, and '91 revenue bonds, SRF loan, transfers to capital budgets (472, 478), PWTF debt service payments for treatment facility construction projects, and the buildup of reserves in Fund 473. It is anticipated that an additional $13 million will be borrowed to finance treatment facility construction during the 6 -year period. Debt service payments will come from this service unit and fund. Our present NPDES permit is scheduled to be updated during the remainder of 2001 and spring 2002. We are uncertain as to what additional fiscal and staffing level impacts the new permit may mandate. 2001 COS Section 4 Page 5 October 10, 2001 Staff will keep the Council advised to developments on this highly significant issue. SU 233 Pretreatment Monitoring Fees• This Service Unit was created in 1995 to fund the Federally Mandated Pretreatment Program. Our new NPDES Permit, which should be in effect by 2002, will require the City to maintain a "Delegated Pretreatment Program" This will require additional staff, equipment and other resources. As shown on Table 4-7, budgeted expenses are $391,505 for 2001. However, there is a strong indication that the City's issuance of permits to and increases in monitoring of businesses within our service area will be mandated by EPA beginning mid -year 2002. Therefore, this report projects three additional F T E's 2002 with necessary equipment. The budget projection for 2006 is $819,347. See Section 6 for additional detail on this mandated activity. SU 234 Food Processing Wastewater. The treatment plant has been retrofitted to accommodate this wastewater stream. The sprayfield's Tong -term future is uncertain at this time. Consequently, minimum staff time is allocated for ground water monitoring, maintenance of the trees, fences and equipment. Beginning in 2002, all expenses have been moved to Service Unit 232. Capital and debt service expenses include the industrial Waste pumping station's share of the outstanding '78/96 revenue bond. Beginning in 2002, these obligations have been moved to Service unit 232. Fund Reserves. Over the past few years, system expenses have exceeded revenues. This situation has depleted the 473 Fund reserves to a level below that recommended by the Utility Rate Advisory Board. TABLE 4-1 (Existing rates) demonstrates that, at existing rates, even . I . .. 0- . 1 1 • .10 1/.lS. • . • . • • - 1-. 1- 2000 Facilities Plan, the 473 Fund reserves would continue to be will be negative before the end of the year 2004 enables the implementation of the 2000 Facilities Plan recommendations and allows the Fund reserve to remain healthy at during the planning 2001 COS Section 4 Page 6 October 10, 2001 period Bear in mind that the Facilities plan calls for an additional $44.9 million in construction activity during 2006 through 2012. Summary; Total operating and maintenance expenses of the wastewater system, excluding the utility tax, are projected to be $5,952,149 for 2 0 01 and are projected to increase by approximately 5% per year to $7,983,637 by 2016 (Table 4-2B) Total capital and debt service payments are projected to he $3,038,971 for 20_01 and increase to $3_874,425 by 2006 (Table 4 - MI 1 .-. - - . - ..- •a 1- . .1. 1! revenue bonds. When combined, Operation, Maintenance, and Capital expenditures are 1• 11 ... • 41 0. by 2006. This represents an annual increase of approximately 5.0% If rates remain at existing levels, the 473 Fund reserves decrease in excess of $700,000 per year and will be zero within two years. 2001 COS Section 4 Page 7 October 10, 2001 TABLE 4-1 (Existing Rates) FUND 473 Wastewater Operations and Maintenance Description see 2001 2002 2003 2004 2005 2006 Table Cash Balance Forward 2,323,974 2,094„492 1,483,876 790,173 (62,918) 1,037,944 REVENUE Pretreatment Fees 181,875 181,875 181,875 131,875 181,875 181,875 County Retail and Strong Waste 7-1/8-1 1,254,756 128,194 132,315 136,295 140,516 144,792 City of Union Gap 9-1 428,517 459,742 481,917 493,518 526,449 537,579 Terrace Height Sewer Dist. 9-1 205,049 221,380 233,318 240,100 257,605 264,395 Industrial Waste 12-4 0 0 0 0 0 0 City Strong Waste 11-1 453,621 458,157 462,739 467,366 472,040 476 760 Interest on Reserves @ 3% 69,719 62,835 44,516 23,705 Other Misc. 369,891 353,846 310,936 327,582 345,062 363,418 City of Yakima Retail 12-1 6,935,627 9,899,055 7,562,622 9,428,651 7,587,434 9,435,050 7,612 280 9,462,721 7 637,257 9,560,804 7,662,269 9,631,088 Total Revenue Total Available Funds 12,223,029 11,523,143 10,9113,926 10,272,895 9,497,886 8,593,144 EXPENSES Operations and Maintenance 4-2A 8,954,231 8,996,931 8,914,211 9,114,257 9,307,085 9,508,840 City Utility Tax 1 104,636 10,128,537 1,042,336 10,039,267 1214542 10,1213,753 1,221 556 10,3 =5,813 1 228 745 10,535,830 1 ,236,076 10,744,916 Total Expense Fund Balance -End of Year 2,094,492 1,483,876 790,173 (62,918) (1,037,944) (2,151 ,7726 annual deficit _229,482) (610,616) (693,703) (851292)_ (975,026)_ (1,113,828 10/8/01 Table 4-2A FUND 473 WASTEWATER OPERATIONS AND MAINTENANCE EXPENSES includes Existing Staff, Debt Service and minimal Capital Transfers Account Description Final Final Final Estimate Estimate Estimate Estimate 'Estimate Estimate No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 Budget _ Test Year OPERATIONS EXPENSES 211 Collection 1,659,362 1,595,053 1,729,485 1,802,591 1,861,590 1,913,427 1,966,719 2,021,507 2,077,834 30.47% 30.30% 213 Storm Drainage 131,758 104,575 147,587 167,781 188,686 193,955 199,372 204,941 210,667 2.84% 3.07% 215 RudklnRoad 81,393 72,775 90,557 83,878 1.42% 89,494 92,065 94,711 97,433 100,234 1.46% 232 Treatment Facility 3,031,446 3,276,811 3,000,583 3,248,766 3,504,025 3,584,786 3,690,198 3,798,885 3,910,956 54.92% 57.02% 233 Pretreatment 346,512 403,149 403,060 391,505 6.62% 498,086 520,286 532,812 545,675 558,883 8.15% 234 Industrial Waste 270,507 246,202 260,338 220,739 0 0 0 0 0 3.73% 0.00% subtotal Operations 5,520,978 5,698,565 5,631,610 5,915,260 5.04% 6,141,881 3.83% 6,304,519 2.65% 6,483,812 2.84% 6,668,441 2.85% 6,858,574 2.85% percent increase 3.22% -1.17% percent of total budget 68.70% 67.88% 68.65% 66.06% 68.27% 70.72% 71.14% 71.65% 72.13% CAPITAL EXPENSES 211 Collection 622,176 848,225 560,946 806,658 837,679 655,139 663,148 669,610 677,250 213 Storm Drainage 0 0 0 0 0 0 0 0 0 215 Rudkin Road 5,539 5,283 5,417 5,548 8,729 5,400 5,651 5,428 5,498 232 Treatment Facility 1,871,733 1,827,068 1,989,119 2,210,688 2,008,642 1,949,153 1,961,646 1,963,606 1,967,518 233 Pretreatment 0 0 0 0 0 0 0 0 0 234 Industrial Waste 15,789 15,872 15,882 16,077 0 0 0 0 0 subtotal Capital 2,515,237 2,696,448 2,571 ,364 3,038,971 2,855,050 2,609,692 2,630,445 2,638,644 2,650,266 percent increase 7.20% -4.64% 18.19% -6.05% -8.59% 0.80°k 0.31% 0.44% percent of total budget 31.30% 32.12% 31.35% 33.94% 31.73% 29.28% 28.86% 28.35% 27.87% TOTAL EXPENSES 8,036,215 8,395,013 8,202,974 8,954,231 8,996,931 8,914,211 9,114,257 9,307,085 9,508,840 percent increase 4.46% -2.29% 9.16% 0.48% -0.92% 2.24% 2.12% 2.17% 1UIbiui TABLE 4-1 (OPTION A) (Single Adjustment) FUND 473 Wastewater Operations and Maintenance Includes Proposed Rate Adjustment Description see 2001 2002 2003 2004 2005 2006 Table Cash Balance Forward 2,323,974 2,094,492 3,835,819 5,656,089 6,650,084 6,952,670 REVENUE Pretreatment Fees 12-4 181,875 469,812 643,324 665,731 689,055 713,335 County Retail 12-4 1,252,256 146,069 150,766 155,303 160,115 164,988 City of Union Gap 12-4 428,517 459,742 481,917 493,518 5:26,449 537,579 Terrace Fleight Sewer Dist. 12-4 205,049 221,380 233,318 240,100 257,605 264,395 Industrial Waste 12-4 0 0 0 0 0 0 City Strong Waste 12-4 453,621 640,138 646,540 653,005 659,535 666,130 Interest on Reserves @ 3% 69,719 62,835 115,075 169,683 1 99,503 208,580 Other Misc. 12-4 372,391 391,888 411,436 428,082 445,562 463,918 City of Yakima Retail 12-1 6 935,627 10,270,609 10 30L42410,338 285 13,143,707 10 372 327 13,310,151 10 406 414 13,425,339 Total Revenue 9,899,055 12,662,473 12,986,800 Total Available Funds 12,223,029 14,756,965 16,82:2,619 18,799,795 19,960,235 20,378,009 EXPENSES Operations and Maintenance 4-2B 8,954,231 9,805,412 9,99:2,020 10,857,814 11,615,970 11,848,691 City Utilit Tax 12-4 1 104,636 1,1 15,734 11742510 11,166,530 1,291 897 12,149,711 1 ,391 ,595 13,007,565 1 421 933 13,270,624 Total Expense 10,128,537 10,921,1146 Fund Balance -End of Year 2,094,492 3,835,819 5,656,089 6,650,084 6,952,670 7,107,385 Annual balance -229 482 1,741,327 1 820,270 993 996 302 586 154,715 10/8/01 TABLE 4-1 (OPTION B) (3 equal increases) FUND 473 Wastewater Operations and Maintenance Includes Proposed Rate Adjustment Description see 2001 2002 2003 2004 2005 2006 Table Cash Balance Forward 2,323,974 2,096,992 1,946,325 2,736,385 3,652,873 3,876,011 REVENUE Pretreatment Fees 12-4 181,875 469,812 643,324 665,731 689,055 713,335 County Retail and Strong Waste 12-4 1,254,756 143,478 155,504 168,243 173,455 178,733 City of Union Gap 12-4 428,517 459,742 481,917 493,518 526,449 537,579 Terrace Height Sewer Dist. 12-4 205,049 221,380 233,318 240,100 257,605 264,395 Industrial Waste 12-4 0 0 0 0 0 0 City Strong Waste 12-4 453,621 599,753 646,540 653,005 659,535 666,130 Interest on Reserves @ 3% 69,719 62,910 58,390 82,092 109,586 116,280 Other Misc. 12-4 372,391 391,888 411,436 428,082 445,562 463,918 City of Yakima Retail 12-1 6,935,627 8,421,516 9,326,161 10,335,429 10,369,456 10,403,529 Total Revenue 9,901,555 10,770,479 11,956,590 13,066,200 13,230,703 13,343,899 Total Available Funds 12,225,529 12,867,471 13,902,915 15,802,584 16,883,576 17,219,911 EXPENSES Operations and Maintenance 4-2B 8,954,231 9,805,412 9,992,020 10,857,814 11,615,970 11,848,691 City Utility Tax 12-4 1,104,636 1,115,734 1,174,510 1,291,897 1 ,391 ,595 1 ,421 ,933 Total Expense 10,128,537 10,921,146 11,166,530 12,149,711 13,007,565 13,270,624 Fund Balance -End of Year 2,096,992 1,946,325 2,736,385 3,652,873 3,876,011 3,949,287 Annual balance -226,982 -150,667 790,060 916,489 223,138 73,275 10/8/01 TA'- LE 4-1 (OPTION C) (Adjustment each year) FUND 473 Wastewater Operations and Maintenance Includes Proposed Rate Adjustment Description see 2001 2002 2003 2004 2005 2006 Table Cash Balance Forward 2,323,974 2,096,992 2,465,461 3,224,693 3,444,206 3,299,802 REVENUE Pretreatment Fees 12-4 181,875 469,812 643,324 665,731 689,055 713,335 County Retail and Strong Waste 12-4 1,254,756 143,478 155,504 168,243 173,455 178,733 City of Union Gap 12-4 428,517 459,742 4811,917 493,518 526,449 537,579 Terrace Fleight Sewer Dist. 12-4 205,049 221,380 233,318 240,100 257,605 264,395 Industrial Waste 12-4 0 0 0 0 0 0 City Strong Waste 12-4 453,621 599,753 646,540 653,005 659,535 666,130 Interest on Reserves @ 3% 69,719 62,910 73,964 96,741 103,326 98,994 Other Misc. 12-4 372,391 391,888 41 11,436 428,082 445,562 463,918 City of Yakima Retail 12-1 6 935,627 8,940,652 9,279,759 11,925,762 9,623,804 12,359,224 10,008,174 12,363,161 10,400,645 13,323,729 Total Revenue 9,901,555 11,289,615 Total Available Funds 12,225,529 13,386,607 14,3911,223 15,593,917 16,307,367 16,623,531 EXPENSES Operations and Maintenance 4-2B 8,974,311 9,805,412 9,992,020 10,857,814 11,615,970 11,848,691 City Utility Tax 12-4 1,104,636 1,115,734 1 ,174,510 1,291 ,897 1,391,595 13,007,565 1,421 ,933 13,270,624 Total Expense 10,128,537 10,921,146 11,166,530 12,149,711 Fund Balance -End of Year 2,096,992 2,465,461 3,224,693 3,4414,206 3,299,802 3,352,907 Annual balance -226,982 368,469 759 232 219 513 -144,404 53,105 10/8/01 Table 4-2B FUND 473 WASTEWATER OPERATIONS AND MAINTENANCE EXPENSES includes recomended Staff, new Debt Service and recomended Capital Transfers Account Description Final Final Final Estimate Estimate Estimate Estimate ; Estimate Estimate No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 Budget Test Year OPERATIONS EXPENSES 211 Collection 1,659,362 1,595,053 1,729,485 1,802,591 2,141,038 2,461,265 2,789,657 2,865,018 2,942,433 30.28% 36.86% 213 Storm Draina•e 131,758 104,575 147,587 167,781 188 686 193,955 199,372 204,941 210 667 2.82% 2.64% 215 RudkinRoad 81,393 72,775 90,557 83,878 89,494 92,065 94,711 97,433 100,234 1.41% 1.26% 232 Treatment Facility 3,031,446 3,276,811 3,000,583 3,248,766 3,504,025 3,584,786 3,690,198 3,798,885 3,910,956 54.58% 48.99% 233 Pretreatment 346,512 403,149 403,060 391,505 729 505 758,647 778,324 798,552 819,347 6.58% 10.26% 234 Industrial Waste 270,507 246,202 260,338 257,628 0 0 0 0 0 4.33% 0.00% subtotal Operations •:rcent increase 5,520,978 5,698,565 3.22% 5,631,610 -1.17% 5,952,149 5.69% 6,652,748 11.77% 7,090,718 6.58% 7,552,262 6.51% 7,764,829 2.81% 7,983,637 2.82% percent of total budget 68.70% 67.88% 68.65% 66.20% 67.65% 70.90% 69.50% 66.79% 67.33% CAPITAL EXPENSES 211 Collection 622,176 848,225 560,946 806,658 961 520 955 139 963,148 1,225 484 1 233,124 213 Storm Drainage 0 0 0 0 0 0 0 0 0 215 Rudkin Road 5,539 5,283 5,417 5,548 5 435 5,400 5,651 5 428 5 498 232 Treatment Facilit 1,871,733 1,827,068 1,989,119 2,210,688 2 213 798 1,949 153 2,345,457 2,629 259 2,635,803 233 Pretreatment 0 0 0 0 0 0 0 0 0 234 Industrial Waste 15,789 15,872 15,882 16,077 0 0 0 0 0 subtotal Ca.Ital percent increase percent of total budget 2,515,237 31.30% 2,696,448 7.20% 32.12% 2,571,364 -4.64% 31.35% 3,038,971 18.19% 33.80% 3 180 753 4.67% 32.35% 2,909,692 -8.52% 29.10% 3,314,256 13.90% 30.50% 3,860,171 16.47% 33.21% 3,874,425 0.37% 32.67% TOTAL EXPENSES 8,036,215 8,395,013 8,202,974 8,991,120 9,833,501 10,000,410 10,866,518 11,625,000 11,858,062 percent increase 4.46% -2.29% 9.61% 9.37% 1.70% 8.66% 6.98% 2.00% l U! 10/5/01 Table 4-3 COLLECTIONS (Service Unit 211) Expenses Account Description Actual Aci:ual Actual Estimate Estimate Estimate Estimate Estimate Estimate Muldpiler No. 1998 1999 2000 2001 2002 21)03 2004 2005 2006 02-08 211 Budget Test Year COLLECTIONS SERVICE UNIT OPERATION EXPENSES 106.140 Salaries and Wages 677,029 192,890 630,008 185,472 737,025 196,094 761,283 221,573 802,061 205,915 822,112 212,092 842,665 218,455 23,340 23,603 5,305 15,914 2,652 7.51)8 1,008 318 863,732 225,008 24,040 24,311 5,464 16,391 2,732 7,733 1,038 328 885,325 231,759 24,761 25 040 5,628 18,883 2,814 7,965 1,069 338 1.025 1.030 1.030 1.030 1.030 1.030 1.030 1.030 1.030 1.030 200's Personnel Benefits 310 Office/Operating Supplies 19,193 20,389 17,385 18,700 21,600 22,000 22,248 22,660 22,915 320 Fuel Consumed 16,814 17,941 20,974 340-350 Resale/Small Tools 30,104 12,973 3 266 1,245 1,711 12,420 6,000 1,000 5,000 15,000 5,150 15,450 2,575 7,289 979 309 3C Chemicals 410 Professional Services 2,648 3,959 3,492 2,500 2,500 7,077 950 300 420 Communications 6,832 6,537 7,095 6,935 430 Transportation/Training 1,025 489 677 0 526 0 950 1,000 440 Advertising 450 Operating Rentals/Leases 0 0 30 2,000 2,000 2,060 21,769 10,300 3,193 2,122 22,422 10,61)9 3,239 2,185 23,095 10,927 3,387 2,251 23,788 11,255 3,489 1.030 1.030 1.030 1.030 1.030 1.030 470 Public Utility Services 18,382 16,519 18,100 3,709 1,249 20,180 12,000 3,100 21,135 10,000 3,100 480 Repairs and Maintenance 4,656 2,641 5,300 1,972 490 Miscellaneous Expenses 530 State Taxes 60,830 56,838 80,023 62,000 62,000 63,860 65,776 0 67,749 0 69,782 0 560-570 Residual Equity Transfers 0 0 0 0 0 0 640 Machinery and Equipment 0 0 0 7,000 5,000 5,150 5,305 5,464 5,628 1.030 1.030 1.030 1.030 1.030 950 Interfund Rentals/Leases 159,204 167,384 147,752 150,112 152,898 157,485 137,917 125,151 162,209 142,055 128,906 167,076 146,316 132,773 172,088 150,706 136,758 960 Insurance/Bonds 130,000 143,000 130,000 133,900 133,900 121,506 991 City Services 107,966 114,593 118,848 116,758 994 Customer Services 215,685 219 953 233,052 254,000 267,000 275,010 283,260 291 758 300 511 subtotal Existing Operations 1,659,362 1,595,053 1,729,485 1,802,591 1,861,590 1,913,427 2.78% 1,968,719 2.79% 2,021,507 2.79% 2 077,834 2.79% percent change 3.88% 8.43% 4.23% 3.27% FACITIES PLAN recomended staff increase (Tab's 1-9) Additional staff & equipment' 279,448 286,434 261,404 293,595 267,939 261,404 300,935 274,637 267,939 308,459 281,503 274,637 1.025 1.025 1.025 Additional staff & equipment' Additional staff & equipment' subtotal FACILTIES PLAN increase 279,448 547,838 822,937 843,511 864,599 Total Operations 1,659,362 1,595,053 1,729,485 1,802,591 2,141,038 2361,265 2,789,6157 13.34% 2,865,018 2.70% _2,942,433 2.70% includes FACILITIES PLAN 3.88% 8.43% 4.23% 18.78% 14.96% CAPITAL EXPENSES 488 '78/96 -Bond Redem (PM) 62,858 62,868 63,166 63,941 63,678 63,335 64,638 63,977, 63,977 64.058 64,056 Debt Coverage @2.0 62,868 62,868 63,166 63,941 63,678 63,335 64,638 Other Debt service 189,681 198,888 174,978 191,717 239,292 225,326 223,709 222,092 255,874 220,475 255,874 Future other Debt 55A Transfer to 476 Fund 200,000 300,000 200,000 400,000 500,000 500,000 500,000 500,000 500,000 5CT Connection Charge Transfers 189,627 288,469 122,802 151,000 158,550 166,478 83,335) 174,801 (84,638)(63,977) 963,148 183,541 1,225,484 192,719 (64 056) 1_,233,124 Rollover prior debt coverage (82,868) (62,868) (63,188) (63,941) (63,678) Total Capital 622,176 848,225 560,948 806,658 961,520 955,139 Total SU 211 2,281,539 2,443,278 2,290,431 2,609,249 3,102,558 33416,404 3,752,805 9.85% 4,090,502 9.00% 4,175,557 2.08% percent change 7.09% -6.26% 13.92% 18.91% 10.12% total external debt payment 252,549 281 756 238 144 255 658 302 970 288,681 288,347 541,943 540,405 Table 4-4 STORM DRAINAGE (Service Unit 213) Expenses Account Description Actual Actual Actual Estimate Estimate Estimate Estimate Estimate Estimate Multiplier No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 02-06 Budget Test Year STORM WATER SERVICE UNIT 213 OPERATION EXPENSES' 100-140 Salaries and Wages 44,356 24,320 66,552 67,887 78,366 19,608 3,500 4629 25,000 0 80,325 20,196 3,605 4,768 25,750 0 82,333 20,802 3,713 4,911 26 523 0 84,392 21,426 3,825 5,058 27 318 0 86,501 22,069 3,939 5,210 28 138 0 1.025 1.030 1.030 1.030 1.030 1.030 200 Personnel Benefits 12,432 7,137 17,551 19,441 310 Office/Operating Supplies Fuel Consumed 6,753 0 540 0 1,279 3,500 3 690 5,000 4,025 15 000 320 410 Professional Services' 9,963 11,894 420 Communications 0 0 0 0 430 Transportation/Training 0 0 195 1,000 1,000 0 1,030 0, 0 1,061 0 0 1,093 0 0 1,126 0 0 1.030 1.030 1.030 440 Advertising 0 0 0 0 450 Operating Rentals/Leases 0 0 0 0 0 470 Utility Services 1,340 71 70 82 85 87 90 93 96 1.030 480 •Public Repairs and Maintenance 0 0 0 0 0 0 0 0 0 1.030 490 Miscellaneous Expenses 0 0 0 0 0 0 0 0 0 1.030 530 State Taxes 0 0 0 0 0 0 0 0 0 1.030 640 Machinery and Equipment Interlund Rentals/Leases 0 27,192 0 28,488 0 23,544 0 23 974 0 24,480 0 25,214 0 25 971 0 26,750 16,883 0 27,552 17 389 1.030 1.030 1 030 950 960 Insurance/Bonds 15,000 16,500 15,000 15,450 15,450 15,914 16,391 991 City Services 14,723 15,626 16,206 15,922 16,568 17065 17,577 18,104 18,647 1.030 Subtotal existing program 131,758 104,575 147,587 167,781 188,686 193,955 199,372 204,941 210 667 percent change -20.63% 41.13% 13.68% 12.46% 2.79% 2.79% 2.79% 2.79% 1 See Table 1-10 of Wastewater Facilities Plan Mandatory Program " 263,158 263,158 263,158 263,158 _ This portion of Budget moved to new Stormweter Enterprise Fund 683,246 683,246 683,246 637,719 637,719 509,298 2,093,421 Subtotal Facilities Plan _ 263,158 946,404 1,584,123 CAPITAL EXPENSES Currently none. Facilities Pian budget includes annual capital amortization costs ' Includes money for implementation of modest repair program of existing facilities. 1 1 " Represents anticipated mandated increase in activity related to Storm Water In near future. _ 10/5/01 Table 4-5 RUDKIN ROAD (Service Unit 215) Expenses Account Description Actual 1998 Actual 1999 Actual 2000 Estimate 2001 EistImete 2002 Estimate 2003 Estirnate 2004 Estimate 2005 Estimate 2006 Mu!tiger 02-06 No. Budget Test Year RUDKIN ROAD SERVICE UNIT 215 OPERATIONS EXPENSES 100-140 Salaries and Wages 23,419 6,450 16,022 4,546 25,496 6,573 19,831 5,344 2,500 667 22,692 5,852 2,500 767 23,259 6,028 2,575 790 23,841 6,208 2,652 814 24,437 6,395 2,732 838 25,048 6,586 2,814 863 1.025 1.030 1.030 1.030 200 Personnel Benefits 310 Office/Operating Supplies 2,415 572 237 560 3,325 839 320 Fuel Consumed 410 Professional Services 0 0 0 0 0 0 0 0 0 1.030 420 Communications 597 714 710 731 753 776 799 823 847 1.030 430 Transportation/Training 0 0 0 0 0 0 0 0 0 1.030 440 Advenising 0 0 0 0 0 0 0 0 0 1.030 450 Operating Rentals/Leases 0 0 0 0 0 0 0 0 0 1.030 470 Public 111fly Services 12,403 150 112,677 25 14,993 509 15,220 500 15,813 500 16,287 515 16,776 530 17,279 546 17,798 563 1.030 1.030 480 Repairs and Maintenance 490 Miscellaneous Expenses 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1.030 1.030 530 State/County Taxes 640 Machinery and Equipment 0 22,044 0 23,640 0 23,928 0 24,913 0 26,078 0 26,860 0 27,666 5,464 9,961 0 28,496 5,628 10,260 97,433 2.87% 0 29,351 5,796 10,567 100,234 2.87% 1.030 1.030 1.030 1.030 950 Intertund Rentals/Leases 960 Insurance/Bonds 5,000 5,500 5,000 5.150 5,150 5,305 9,671 991 City Services 8,343 8,855 9,184 9,022 9,389 Total Operations 81,393 72,775 -10.59% 90,557 24.43% 83,878 -7.38% 89,494 6.70% 92,065 2.87% 94,711 2.87% percent change CAPITAL EXPENSES 559 '78/96 I3ond Redemption 5,539 5,539 (5,539) 5,539 5,411 5,411 (5,539) 5,283 5,414 5,414 (5,411) 5,417 5,481 5,481 (5,414) 5,548 5,458 5,458 (5,481) 5,435 5,429 5,429 (5,458) 5,400 5,540 5,540 j429) 5,651 6,484 5,484 (5„540) 5,428 5,491 5,491 (5,484) 5,498 ___ __ __ Debt Coverage @ 2.0 Rollover prior debt coverage lrotal Capital -- Total SU 215 86,932 78,058 95,974 89,426 94,929 97,465 100,362 102,861 105,732 2.79% percent change -10.21% 22.95% -6.82% 6.15% 2.67% 2.97% 2.49% 10/5/01 Table 4-6 TREATMENT FACILITY (Service Unit 232) Expenses Account Description Actual Actual Actual Estimate Estimate Estimate Estimate Estimate Estimate Multiplier No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 02-06 Budget Test TREATMENT FACILITY SERVICE UNIT 232 Year OPERATIONS EXPENSES 100-140 Salaries and Wages 1,470,835 1,628,206 1.409,078 1,469,458 428,655 1,669,247 433,137 3,108 1,710,978 446,131 3,108 1,753,753 459,515 3,108 1,797,596 473,300 3,108 1,842,536 487,500 3,108 1.025 1.030 1.000 200 Personnel Benefits 427,926 463,606 387,138 223 Prior Pension 3,108 3,108 3,108 3,108 310 Office/Operating Supplies 113,191 108,934 116,208 125,000 127,060 130,872 134,798 138,842 143,007 1.030 320-350 Fuel/SmallTools 11,627 8,343 9,774 8,750 120,000 13,533 120,000 13,939 123,600 20,000 16,546 14,357 127,308 20,600 17,042 14,788 131,127 21,218 17,554 15,232 135,061 21,855 18,080 1 030 1.030 1.030 1.030 3C Chemicals 89,467 92,304 100,238 410 Professional Services 11,240 33,911 7,310 70,000 40,900 16,064 420 Communications 13,183 14,657 14,432 15,581 430 Transportation/Training 5,296 5,003 5,347 5,675 5,704 5,875 6,051 6,233 6,420 1.030 440 Advertising 845 806 1,718 2,500 1,000 1,030 1,061 1,093 1,126 1.030 450 Operating Rentals/Leases 1,382 4,356 1,263 1,500 1,550 1,597 1,644 1,694 1,745 1.030 470 Public Utility Services 265,931 253,763 277,671 297,000 310,335 325,852 342,144 359,252 377,214 1.050 480 Repairs and Maintenance 19,224 18,902 12,484 30,000 21,200 21,836 22,491 23,166 23,861 1.030 490 Miscellaneous Expenses 15,354 27,518 5,181 8,000 13,100 13,493 13,898 14,315 14,744 1.030 4DW NPDESPermitFee 46,483 44,886 50,152 48,000 56,000 57,680 59,410 61,193 63,028 1.030 530 State Taxes 103,282 96,818 136,047 105,000 110,000 113,300 116,699 120,200 123,806 1.030 560-570 Residual Equity Transfers 0 0 0 0 0 0 0 0 0 1.030 640 Machinery and Equipment 3,661 13,232 0 50,000 5,000 5,150 5,305 5 464 5 628 1.030 950 Interfund Rentals/Leases Insurance/Bonds 36,300 93,750 37,596 103,125 40,153 93,750 40,239 96,563 71,178 114,212 73,313 117,638 75,513 121,168 77,778 124,803 80,111 128,547 1.030 1.030 960 991 City Services Total Operations percent change 299,360 3,031,446 317,737 3,276,811 8.09% 329,531 3,000,583 -8.43% 323,737 3,248,766 8.27% 371,697 3,504,025 7.86% 382,848 3,584,786 2.30% 394,333 3,690,198 2.94% 406,163 3,798,885 2.95% 418,348 3,910,956 2.95% 1.030 CAPITAL EXPENSES 488 Existing Bonded Debt 1,332,784 1,249,424 1,289,996 1,287,260 1,373,135 1,266,543 949,480 946,761 945,369 Debt Coverage @ 2.0 1,332,784 1,249,424 1,289,996 1,287,260 1,373,135 1,266,543 949,480 946,761 945,369 83P Existing Other Debt 407,099 445,794 444,471 440,578 350,263 184,282 505,515 501,454 497,580 83P Future Other Debt 383,811 665,653 668,285 55D Transfer to 472 Fund 131,850 0 131,850 0 131,850 0 131,850 200,000 131,850 200,000 131,850 200,000 131,850 200,000 131,850 200,000 131,850 200,000 55R Transfer to 478 Fund 5CT Connection Charge Transfers Rollover debt coverage 0 (1,332,7841 0 (1,249,4241 122,802 (1,289,9961 151,000 (1,287,2601 158,550 (1,373,1351 166,478 (1,266,5431 174,801 (949,4801 183,541 (946,761) 192,719 (945,369) Total Capital 1,871,733 1,827,068 1,989,119 2,210,688 2,213,798 1,949,153 2,345,457 2,629,259 2,635,803 TOTAL SU 232 4,903,179 5,103,879 4,989,702 5,459,454 5,717,823 5,533,939 6,035,655 6,428,144 8,546,759 percent change 4.09% -2.24% 1 9.41% 4.73% -3.22% 9.07% 6.50% 1.85% 10/5/01 Table 4-7 Pretreatment Program (Service Unit 233) Expenses Account Description Actual Actual Actual Estimate Estimate Estimate Estimate Estimate Estimate MultpIier 02-06 No. 1998 1999 2000 2001 2002 2003 2004 2905 2006 Budget Test Year (1) 100-140 Salaries 178,568 50,727 180,935 54,017 233,157 62,051 235,842 65,845 308,658 82,999 316,374 85,489 324,284 88,054 332,391 90,695 340,701 93,416 1,025 1 030 200 Personnel Benefits 310 Office Supplies 5,019 175 215 3,654 1,056 65 6,800 2,041 54 5,500 2,000 500 5,500 2,000 500 5,665 2,060 515 5,835 2,122 530 6,010 2,185 546 6,190 2,251 563 1.030 1,030 1.030 320 fuel 350 Small tools 3C Chemicals 0 68 273 250 250 258 265 273 281 1.030 410 Outside Laboratory Services 63,010 112,334 42,288 722 25,000 731 40,000 753 50,000 776 50,000 799 50,000 823 50,000 848 1.030 1.030 420 Communications 785 714 430 Transportation/Training 447 713 856 0 1,085 207 0 475 1,200 0 475 1,200 0 489 1,236 0 504 1,273 0 519 1,311 0 535 1,351 0 1.030 1.030 1.030 440 Newsletter & Mailings 0 0 450 Outside Rentals 480 Repairs 0 69 0 750 750 773 796 820 844 1 030 490 Miscellaneous Expenses 1,955 2,306 8,163 0 1,774 2,104 7,628 0 787 5,328 6,907 2,892 2,000 2,500 7,500 2,980 2,000 2,500 7,500 3,075 2,060 2,575 7,725 3,167 1,327 34,132 5,665 2,122 2,652 7,957 3,262 1,366 35,156 5,835 532,812 2.41% 2,185 2,732 8,195 3,360 1,407 36,211 6,010 545,675 2.41% 2,251 2,814 8,441 3,461 1,450 37,297 6,190 558,883____ 2.42% 1.030 1.030 1.030 1.030 1.030 1.030 1.030 ____ 530 State/County Taxes 640 Capital Equipment 950 Interfund Rentals 960 Insurance/Bonds 1,250 1,375 1,250 32,413 4,805 1,288 31,843 5,300 1,288 33,138 5,500 991 City Services 29,445 31,253 994 Customer Services 4,447 4 535 Subtotal existing 346,512 403,149 403,060 -0 02% 391,505 -2.87% 498,086 27.22% 520,286 4.46% % Change 16.34% MANDATED Delegated Program (Pre -treat) see Table 1-8 of the Wastewater Facilities Pan 200,500 206,515 31,846 212,710 32,801 219,092 33,786 225,665 34,799 1.030_ 1.030 DelegaCed Pro.ram Lab see Table 1-9 of the Wastewater Facilities Plan 39119 Subtotal Fully Delagated Program 231,4119 238,361 245,512 252,877 260,464 _ Total Mandated Program 346,512 403,149 16 34% 403 060 -0.02% 391,505 -2.87% 729,505 86.33% 758,647 3.99% 778,324 2.59% 798,552 2.60% 819,347 2.60% _ _____ %Change 10/5/01 Table 4-8 INDUSTRIAL WASTE (Service Unit 234) Expenses 10/5/01 Account Description Actual Actual Actual Estimate Estimate Estimate Estimate Estimate Estimate Multiplier No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 02-06 Budget Test Year INDUSTRIAL WASTE SERVICE UNIT 234 OPERATIONS 100-140 Salaries and Wages 110,468 93,653 102,412 101,980 0 200 Personnel Benefits 30,674 28,103 32,633 34,478 0 310 Office/Operatinq Supplies 22,480 7,963 15,860 500 0 320-350 Fuel/Small Tools 2,616 1,959 1,288 1,210 0 410 Professional Services 18,216 29.777 12,374 3,500 0 420 Communications 868 320 619 25 0 430 Transportation/Training 201 0 0 29 0 Discontinue Service unit 234 440 Advertising 0 0 0 0 0 450 Operating Rentals/Leases 298 89 215 50 0 Transfer ell sprayfield expenses 470 Public Utility Services 3,858 4,959 2,640 1,000 0 480 Repairs and Maintenance 3,545 4,259 1,587 1,200 0 to Service Unit 232 490 Miscellaneous Expenses 642 83 0 100 0 530 State Taxes 4,910 5,966 13,048 5,000 0 570 Residual Equity Transfer 0 0 0 0 0 640 Machinery and Equipment 6,400 0 6,321 0 0 650 Engineering Study 0 0 0 0 0 950 Interfund Rentals/Leases 27,192 28,488 29,904 30,332 0 960 Insurance/Bonds 5,000 5,500 5,000 5,150 0 991 City Services 30,918 32,815 34,034 33,435 0-, 994 Customer Service 2,224 2,268 2,403 2,750 0 subtotal Operations 270,507 246,202 260,338 220,739 0 percent change -8.98% 5.74% -15.21% -100.00% 179,404 CAPITAL EXPENSES 488 '78/96 Bond Redem (prin) 15,789 15,872 15,882 16,077 0 Debt Coverage @ 2.0 15,789 15,872 15,882 16,077 0 Rollover prior debt coverage (15,789) (15,872) (15,882) (16,077)_ 0 subtotal Capital 15,789 15,872 15,882 16,077 0 0 0 Total 234 286,296 262,074 276,220 236,816 0 percent change -8.46% 5 40% -14.27% 0 10/5/01 TABLE 4-9 Transfers from Operating Fund (473) to (Operating Reserve and Capital Funds 9/19/01 2000 :2001 2002 2003 2004 2005 2006 2.0 Debt Coverage on Bonded Debt TOTAL $1,374,493 $1,372,795 $1,174,181 $905,130 $914,610 $911,006 $909,721 from TH $38,610 $38,500 $37,081 $32,818 $33,127 $33,018 $32,963 from UG $78,184 $77,963 $75,090 $66,456 $67,083 $66,862 $66,750 UGRudRd. $3,124 '.3162 $3,149 $1,062,010 $3132 $805,857 $3,197 $814,400 $3.1164 $811,125 $3,168_ $810,009 City's share $1,257,699 $1,256,332 TRANSFERS FROM 473 OPERATING FUND City (473) to 472 $131,850 $131,850 $131,850 $131,850 $131„850 $131,850 $131,850 City (473) to 476 $200,000 $400,000 $500,000 $500,000 $500,000 $500,000 $500,000 WCC to 476 $151,000 $151 000 $158,550 $166,478 $174,801 $674,801 $183 541 $683,541 $192,719_ $692,719 Total to 476 $351,000 $551,000 $658,550 $666,478 City (473) to 478 $CI $200,000 $200,000 $200,000 $2000,000 $200,000 $200,000 WCC to 478 $151,00(1 $151,000 $158,550 $166,478 $174,801 $33,127 $183,541 $33,018 $192,719_ $32,963 TH to 478 $38,61(1 $38,500 $37,081 $32,818 UG to 478 $78,184 $77,963 $75,090 $66,456 $67,083 $3,197 $478,208 $66,862 $3,164 $486,586 $66,750u _ $3,168 $495,599 (JG(Rud Rd) to 478 $3,124 $270,918 _$3,162 $470,626 $3,149 $473,870 3 132 $468,884 Total to 478 Total Transfers $753,768 $1,153,476 $11,264,270 $1,267,212 $1,284,859 $1,301,977 $1,320,168 Transfers in excess of Debt Coverage and WCC (from rates ($925,849) ($524,482 $230,160) $25,993 $17,450 $20,725 $21,841 9/19/01 Table 4-10 Existing + Proposed Wastewater System Debt Service Year . Total Total First Total Total Total Total Total Wastewater . Wastewater Priority Debt Collection _Total Rudkin Road Treat. Fac. I.W Treat. Fac. Treat. Fac. Debt Debt SU211 SU215 SU232 SU234 . ' SU232 SU211 Service Service 2.0 coverage EXISTING Debt Sery EXISTING Debt Sery EXISTING Debt Sery EXISTING Debt Sery • EXISTING . Debt Sery FUTURE Debt Sery FUTURE EXISTING EXISTING + FUTURE Prin.. 30,130,361 . 17,130,361 7,683,647 3,329,643 35,550 13,660,888 104,280' 13,000,000 2,000,000 2001. 1,985,053 ' 1,985,053 1,372,758 235,658 5,481 1,727,838 16,077. 2002 2,011,827 2,011,827 1,174,181 282,970 5,458 5,429 1,723,398 1,450,825 0' 2003. 1,744,915 1,744,915 905,130 288,661 2004 ' 2,132,693. 1,748,882 1,739,768 914,609 911,007 288,347 286,069 5,540 5,484 1,454 995 1,448,215 383811 2005. 2,405,421 665,653 255,874. 2006:. 2,401,256. 1,732,971 909,720 284,531 5,491 1,442,949 668285 255874 2007 2,675,777 1,728,019 910,280 283,658 5,554 1,438,806 947,758 255,874. 2008. 2,681,764 1,702,492 907,140 264,801 5,523 1432168 979272 255,874: , 255,874 ' 2009 2,248,869. 1,274,647 540,385 198,749 0 1,075,897 974,222 2010. 2,264,884 2,261,064 1,264,461 535155 197,133 1,067,328 1,000,423 255,874. 2011 1,266,003 541,279 195,889 1,070,114 995,061 255,874 2012 1,527,423. 1,071,563 537,724 0 193,899 343,825 989,699 600,526 255,874. 255,874' 2013 471,037 130,551 340,486 2014. 891,358 296,194 129,552 166,642 595,164 0. . 2015 842,463 252,661 87,653 165,008 589,802 2016 634177. 49,737 49,737 0 584,440 2017. 628,342 49,263 49,263 579,079 2018 622,506 48,789 48,789 573 717 2019. 616,672 48,316 48,316 568,356 2020 610,836. 47 842 47 842 562,994 2021 . 557,632 0 0 557,632 2022 ' 552,270. . 552,270 546,908 2023. 546,908 2024: 273,454 2734 270,773 2025 270,773 2026. 0 0 2027 2028. 2029 ' . . 2030. . TOTAL:'. 34,459,899.. 20,000 600 9,621,643 3,592,068 43,959 16,348,496 16,077'. • 14,459,299 2,302,866.H. 9/20/01 Page 1 of 4 Table 4-10 Existing + Proposed Wastewater System Debt Service Year 1991 1991.. 1978/96 1978/96 1978/96 1978/96 . 1978/96. 1992 1988 1991 1992 1995 Revenue Treat. Fac.. 100% Collect. Rudkin Rd. Treat. Fac. I.W. SRF PWTF PWTF . PWTF : PWTF SU232 SU211 SU215 SU232 SU234 SU 232 SU232 SU211 SU211 • : SU211 Bond 91.75% Sewer 17 50% 1 50% 76 60% 4 40% . P&I .Treat. Fac. Collections . C?llections. Prot. 1497 : Collections Proj. 1526 :.:' I-82/Race trans to 232.. Treat. Fac. . Proj. 1300 . Proj. 1455. Canal . 81 00% 2002 . . : Humphrey ' PPL ; Pipe #1 •;:.: Prin.. 4,800,000 4,404,000 2,370,000 414,750 35,550 1,815,420 104,280, 909,647. : 444,633 . 102,000 . 740,772 .' . 360,000 2001 743,960 682,583 365,375 63,941 5,481 279,877 16,077; . 324,800 . 60,025 16,875. 69,139,'•' . 25,641: 2002 706,600 648,306. 363,875 361,915 63,678 63,335 5,458 5,429 294,739 293,151 0: 162,000. . 59,470 16,875, . 68,521: 25,641 2003 592,060 543,215 0, . 58,914 . 16,875. • 67,904. 25,641. 2004 594,277 545,249. 369,360 365,585 64,638 63,977 64,056 64,800 5,540 5,484 5,491 5,554 299 182 296,124 296,488 299,931 0: 58,358 16 875 ': 67,287`..•. 25,641:::: 2005 594,465 545,422 0: . 0. 57,802 . 16,875 66,669 25,641'' 2006 592,573 543,685. 366,035 370,285 57,246 . 16,875..:.. 16,875. : 66,052. 65,435: ,:. 25,641 25,641 2007588,550 539,995 0: 56,691 . . 2008 587,400 588,975 538,940 540,385.64,200', 368,200 64,435 5,523 298 242 0 : 56,135 .64,818::;• •• 25,641. 2009 25,641. 2010 583,275 535,155 : 63,583 . 25,641 2011 589,950 541,279. : . 63,339:• 25•,641::. 2012. : . '. 62,348;. •'. 25,641. 2013' . . 25_,641' 2014: . 25,641. • 2015_ •. 25,641:.: 2016 •. : 2017 . 2018 _ 2019 2020 : . 2021 2022 2023. 2024 • 2025 : 2026.. . . ' 2027 <':: •---_• ;; 2028 ' : 2029 .' 2030 :..: X1!--• :>:, 'Fi4't�-���irrv� iMt TOTAL 6,762,085 6,204,213. . 2,930,630 512 860 43,959 2,357,734 --+.�M-�--� !'fS 16,077. " 486 800:'',. 464,641;, . 118,125: . 789,296W?: 384,609' V. M 9/20/01 Page 2 of 4 Table 4-10 Existing + Proposed Wastewater System Debt Service • • Year"' 1993 ..• 2001 1993 .:-. 1995 1995 .• . .• • • . . . 2001 • . , . PTF : PwrF . : PWTF PWTF . PWTF 1.4 mill LoC SU232 1 : SU211 : ' SU232 . SU211 • SU211 SU 232 i . Treat. Fac. : Collections: • Treat. Fac. ,• Collections . Collections :i Treatment . • Proj. 1566. . Proj. 1616: Proj. 1638 . Proj. 1710 . .• Proj. 1918 Pro]. 1942 B.S. Pad i • Pipes #2 :. . IMO . ' King St.. 24th & . . Line of Credit . ; Jerome Existing Prin.. : : 2,216,572 .: 636,845 : . 2,450,616. : 175,276 ..1 900,000 1,420,000 2001 :. 192,671:. : 46,625:. ' 187,881 . .. 13,438 2002 '':- 190,966: 1 46,2161. . 186,247 • 13,321 : 48,718 181,671 .. 2003: •:. 189,261. : 45,807: ' 184,613 . 13,204 .; 55,895 181,671 2004,: 187,556; .: 45,398:, . 182,979.' 13,087 . 55,421.181 671 2005. 185,851: . 44,989: • 181,346 . 12,970, ' 54,947 181,671 2006;L: 184,146. .: 44,580.. . 179,712 • 12,854 , ., 54,474 . 181,671 2007, 182,441: 1 44,171. ' 178,078.. 12,737 : 54,000. ..i.. 181,671 2008: 180,736.. : 43,762: 176,444 . :. 12,620 : 53,526 . 1817i 2009: 179,031: , 43,353. . 174,811. I 12,503 53,053. 181,671 2010: 177,326. : 42,944: • 173,177 . 12,386 ' 52,579;, 181,7j 2011:: 175,621. : 42,5351. . 171,543 ; 12,269 . 52,105.:. 181,671 2012. 173,916. : 42,126; ' 169,909, . 12,152. • 51,632; 2013: 172,211. ' 41,717.. , 168,276 • 12,036 . 51,158'' 2014: : . . . 41,308. • 166,642 . . 11,919 . 50,684i, 2015: . 165,008 •; 11,802 . , 50,211. 2016. •. 1 49,737: 2017:. : 49,263 2018 : : 48,789 2019. 48,316..;i7. ' 2020:: 47,842 • .i•.• 2021 ' 2022: 2023. • 2024. 2025: 2026: 20271 2028 2029: 2030. TOTAL 2,371,7331: : 615,531:::: 2,646,666 •* 189 298 982,350: 1,816,710 9/20/01 Page 3 of 4 Table 4-10 Existing + Proposed Wastewater System Debt Service „ Year . , 2002 2003 2004 2004 x 3.0 mill LoC . 2.5 mill LoC PWTF PW11 SU 232 SU 211 SU232 SU232 Treatment Collection Treatment Treatment Proj. XXX Proj. 1943 Proj. XXX Proj. XXX Treatment Line of Credit , Line of Credit FUTURE Treatment FUTURE FUTURE FUTURE Prin.. ' 3,000,000 2,000,000 5,000,000 5,000,000 2001. 2002. 2003. 383,811 2004' 383811 2551874 255,874 281,842 2005. 383,811 2006 383,811 255,874 284,474 2007 383,811 255,874 282,105 281,842 2008. 3831811 255,874 310,987 284,474 282,105 2009' 383,811 255,874 308,306 2010. 383,811 255,874 305,625 310987 2011 ' 383,811 255,874 302,944 308,306 2012. 383,811 255874 300,263 305,625 2013' 255,874 297,582 302,944 2014 , 294,901 300,263 297,582 2015' 292,220 2016 289,539 294901 2017. 286,859 292,220 2018 284178 289,539 2019. 281,497 286,859 2020 278,816 276,135 284,178 2021. 281,497 2022' 273,454, 270,773 , 278,816 276,135 2023, 2024: 273,454 270,773 2025 1 2026. . 2027 1 2028. : 2029' 2030: TOTAL 3,83.8,110. -, 21558,740 5,502,500 , 5,502,500 9/20/01 Page 4 of 4 SECTION 5 PLANT FLOWS, POLLUTANT LOADING, and CUSTOMER ACCOUNTS Billable Flows; Staff analyzed records of previous billed flow from retail accounts to project Yakima City and Yakima County retail usage for the remainder of the planning period. Using data from 1998 through 2000 billings, this calculation estimated an increase in City retail usage of only .25%. A similar calculation using County retail usage data projected an annual increase of 2.5%. The South 72nd Avenue Annexation will have a significant impact on the allocation of this increased flow. This report estimated 90% of the current County customers would become City customers through this annexation. The projected flow for 2002 and beyond was adjusted accordingly. Staff also analyzed flow data from the municipal wholesale customers (Terrace Heights and Union Gap). Staff predicts Union Gap's flow to increase at an annual rate of 2.0% for the near future. Staff predicts Terrace Height's flow to increase at an annual rate of 3.0% for the near future. These flow projections are shown on TABLE 5-1. TABLE 5-2 demonstrates the percent of each basic customer's allocated capacity that they used in 2000. Staff projected this information for 2002 by using the information from TABLE 5-1. The permitted hydraulic capacity of the Treatment Facility is shown on TABLE 5-2 as 23.3 million gallons per day. The limiting factor of the current plant configuration, which determines hydraulic capacity while meeting permit requirements, is the plant's ability to nitrify and meet ammonia removal requirements. Preliminary planning suggests a capital addition to the activated sludge basins and final clarifiers with a slight modification to the process will address this issue and increase overall facility hydraulic capacity. See Section 4, 478 Fund and the 2000 Wastewater Facilities Plan. 2001 COS Section 5 Page 1 10/10/01 Total Plant Flow; Continued deterioration of irrigation transmission pipes throughout the City significantly contributed to a noticeable setback in wastewater's Infiltration/Inflow (I/I) reduction program for the year 2000. Flow thus far in 2001 continues this trend. Discussions with Irrigation staff are consistent with this observation. As the Teaks in the collection lines are sealed, crews are noticing an increase in the I/I coming from private sidelines "building sewers". Staff is planning to add a dimension to our grouting program in 2002 through the purchase of specialized equipment that can grout a few feet up sidelines. TABLE 5-1 shows that the total plant flow decreased 6.62% from 1998 to 1999 yet increased 17.65% from 1999 to 2000. Billable flows were up 0.85% then down 1.04% during the same periods. Staff projects the combination of increased billable flow and the continued effort with the I/I program to result in total plant f!ow as indicated nn TABLE 5-1. Billahle flows are increasing at approximately 0.6% and the total plant flow is increasing at approximately 1.0% through 2006. TABLE 5-3 and CHARTS 5-3A, 5-3B, 5-3C, and 5-3D indicate: total treatment facility influent flow, total Rudkin road lift station flow, total BOD, and total SS respectively for each month during the period 1997 through 2001. 2001 COS Section 5 Page 2 10/10/01 Pollutant Loading: Although wastewater staff tests for and are concerned with over 150 different possible pollutants, the Targe majority of our current treatment expense is concerned with only three: Biochemical Oxygen Demand (BOD), Suspended Solids (SS), and Ammonia. The Strong Waste loading at the Treatment Facility has notably increased during the past two years with some significant peaks. Pre-treatment staff has spent a tremendous amount of time, with limited success, searching the source of these increases. In addition, all food processing wastewater, which had historically been applied to the sprayfield, will now be treated through the facility. Required capital expansion to adequately treat this increased Toad is discussed in the 2000 Facilities Plan and outlined in Section 4 of this report. TABLE 5-6 shows historical and projected Total Annual loadings for BOD and SS through the planning period. Staff utilized a linear estimation formula that uses the "least squares" method to formulate a straight line that best fits the data available. This line is then extended for the time period chosen. Including the Del Monte loadings, staff has predicted an approximate 6% annual increase for BOD. A more modest 2% annual increase is predicted for SS through the planning period. 2001 COS Section 5 Page 3 10/10/01 Customer Accounts: TABLE 5-7 and 5-8 lists the historical and projected number of wastewater accounts for both City and County retail customers. The South 72nd Avenue Annexation will have a significant impact on the distribution of accounts. This report estimates 90% of the current County customers will become City customers through this annexation. The number of accounts predicted for each billing category is displayed on TABLE 5-7. The number of accounts per each size of water meter is displayed on TABLE 5-8. TABLE 5-9 indicates the Number of Meter Equivalents. As stated in the AWWA M-1 Manual: "Customer -related costs for meters and services may be properly distributed among user classes by recognizing factors that are generally responsible for those costs being incurred.... Distribution of customer costs by equivalent meter and service ratios recognizes that meter and service costs vary depending on considerations such as size of service pipe, materials used and other local characteristics for various sized services. For the purposes of this example, typical customer meter -and -service equivalent ratios based on investment are as follows: Size AWWA Factor 3/4" 1.00 1" 1.27 1.5" 1.64 2" 2.64 3" 10.00 4" 12.73 6" 19.10 8" 26.36 10" 52.72" These equivalent factors are utilized when calculating the "Ready -to - Serve element of the bimonthly service charges. 2001 COS Section 5 Page 4 1 0/1 0/01 Table 5-1 Historical and Projected Billed and Total Flows Treatment Plant and Rudkin Road User Group 1998 1999 2000 2001 2002 2003 2004 2005 2006 Multiplier actual actual actual est. est. est. est. est. est. Test Year City Retail UCC 3,269,519 3,293,865 3,225,810 3,233,875 3,494,674 3,503,410 3,512,169 3,520,949 3,529,752 (Billed Flow) M3 2,445.60 2,463.81 2,412.91 2,418.94 2,614.02 8.06% 2,620.55 0.25% 2,627.10 0.25% 2,633.67 0.25% 2,640.25 0.25% 0.0025 %change 0.74% -2.07% 0.25% County Retail UCC 265,722 248,601 267,263 273,945 28,079 28,781 29,501 30,238 30,994 (Billed Flow) M3 198.76 185.95 199.91 204.91 21.00 21.53 22.07 22.62 23.18 %change -6.44% 7.51% 2.50% -89.75% 2.50% 2.50% 2.50% 2.50% 0.0250 % retail flow 7.52% 7.02% 7.51% 7.81% 0.80% 0.81% 0.83% 0.85% 0.87% Total City & County UCC 3,535,241 3,542,466 3,493,073 3,507,819 3,522,753 3,532,192 2,642.08 3,541 ,670 2,649.17 3,551 ,188 2,656.29 3,560,746 2,663.44 KG 2,644.36 2,649.76 2,612.82 2,623.85 2,635.02 %change 0.20% -1.39% 0.42% 0.43% 0.27% 0.27% 0.27% 0.27% _ Terrace Heights UCC M3 194,037 145.14 206,578 154.52 205,388 153.63 211,549 158.24 217,896 162.99 224,433 167.88 231,166 172.91 238,101 178.10 245,244 183.44 %change 6.46% -0.58% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 0.030 Union Gap UCC 255,682 269,920 278,663 284,236 289,921 295,720 301,634 307,667 313,820 tuG 191.25 201.90 208.44 212.61 216.86 221.20 225.62 230.13 234.74 %change 5.57% 3.24% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 0.020 Total Billed UCC 3,984,960 4,018,963 3,977,124 4,003,605 4,030,570 4,052,344 4,074,469 4,096,955 4,119_,810 M3 2,980.75 3,006.18 2,974.89 2,994.70 3,014.87 3,031.15 3,047.70 3 064.52 3,081 .62 %change 0.85% -1.04% 0.67% 0.67% 0.54% 0.55% 0.55% 0.56% Total Flow UCC 5,237,781 4,891,217 5,754,358 5 911,902 5,870,021 5,928,721 5,988,008 6,047,888 6,108 367 Received at Plant M3 3,917.86 3,658.63 -6.62% 4 304.26 17.65% 4 347.30 1.00% 4 390.78 1.00% 4 434.68 1.00% 4 479.03 1.00% 4 523.82 1.00% 4 569.06 1.00% 0.010 %change Non -billed UCC 1,252,820 872,253 1,777,234 1,808,297 1,839,451 1,876,377 1,913,539 1,950,934 1,988,558 (I/1) Flow AG 937.11 652.45 1,329.37 1,352.61 1,375.91 1,403.53 1,431.33 1,459.30 1,487.44 % of Total 23.92% 17.83% 30.89% 31.11% 31.34% 31.65% 31.96% 32.26% 32.55% Total Rudkln Road UCC 957,219 918,676 1,013,102 1,043,495 1,074,799 1,107,043 1,140,255 1,174,462 1,209,696 M3 716.00 687.17 757.80 780.53 803.95 828.07 852.91 878.50 904.85 %change -4.03% 10.28% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 0.030 %t1G 26.71% 29.38% 27.51% 27.24% 26.97% 26.71% 28.45% 28.20% 25.94% %Yakima 73.29% 70.62% 72.49% _ 72.76% 73.03% 73.29% 73.55% 73.80% 74.06% " Change In flow anticipates annexation of 90% of existing County Retail Customers through 72nd. Ave Annexation. + 9/19/01 TABLE 5-2 Utilization of Treatment Facility Capacity Service %> Ave. Day 2000 Ave. Day % of Capacity Currently Used Remaining Capacity 2002 Estimate Ave. Day Max. Month % of Capacity Currently Used Remaining Capacit Area Allocated Max. Month Capacity Allocated Max. Month Capacity HYDRAULIC million gallons per day 19.602 11.725 59.82% 7.877 11.980 61.12% 7.622 Yakima, City 87.90% Union Gap 8.10% 1.806 0.719 39.82% 1.087 0.748 41.43% 1.058 Terrace Heights 4.00% 0.892 0.465 52.18% 0.427 0.494 55.36% 0.398 TOTAL 100.00% 22.300 12.910 57.89% 9.390 13.222 59.29% 9.078 BOD pounds per day Yakima, City 87.90% 28,743 21 ,774 75.75% 6,969 32,342 Due to existing construction, Capacity should in our 2002 permitted increase _' •ermit. Union Gap 8.10% 2,649 1,472 55.56% 1,177 1,531 Terrace Heights 4.00% 1,308 838 64.03% 470 889 TOTAL 100.00% 32,700 24,083 73.65% 8,617 34,761 SS pounds per day Yakima, City 87.90% 30,765 16,703 54.29% 14,062 19,927 Due to existin• Union Gap 8.10% 2,835 1,889 66.62% 946 1,965 construction, permitted Ca•acit should increase Terrace Heights 4.00% 1,400 914 65.32% 486 970 in our 2002 •ermit. TOTAL 100.00% 35,000 19,506 55.73% 15,494 22,862 9/19/01 Table 5-3 Plant Loading Hydraulic, BOD, SS, Rudkln Rd. Mont H draulic H draullc2 H draulic3 H draullc4 H draulic5 x BOD BOD2 BOD3 BOD4 BOD5 x . 1997 982 1998 353 1999 991 2000 1111n11U11/3=11 985 Ru4dn Rd. Rudkln Rd2 Rudkln Rd.3 1999 R dldn Rd.4 2000 Rudl4n Rd.5 INE1731111MI Total Mont! load 2000 111/1111 1997 1998 1999 2000 2001 65L841 551 320 -I-- 537 291 II 60.22 11111EITEIIIIIIIIMMMIIIIIIIIMECHIll --IN December Januar 267,45 1111111 277.89 268.34 276.52 243.54 ® 244.57 274.19 300.46 255.62_II 529 100 631 748 564 173 624009 671540 740 905 822,367 491 220 599 698 538 023 539 076 572,1346 571,772 598,499 625,196_ 951 494 779 160 573 531 474 916 518 129 488 295 456 502 441 603 551 811 596 009 11=111 U 59.63 47.75 111111111111111311r1131111 Februar 11101111111332/1 AQrll =WEI 9*254 326.48 07 273.72 288 76 227.80 259.31 451,364 54.93 43.79 111.0111 40.90 11111111111 283.17 1 605 830 646 720 588 828 714 445 881979 52540 575 628 554 827 660 010 1 56 61 111.13711=111111111311=173111. 291.63 330.75 313.36 111 567 653 535,126 538,318 669 893 851155 477 280 487<751 146 120 545 629 629 621 1 52.28 ® 40.65 MIIIIIIIIIIITICEIIII Ms 338.65 338 92 326.56 370.69 391.18 463.96 381.00.1 395 40.1 436.21 509 133 524,138 501 493 526,119 519885 632,461 571,057 702655 710 212 814,834 755,030 446 355 196,275 163,186 196,231 426 678 443 537 566 733 557 595 589 866 622 835 59 51 68 87 EMBIll 1111111711111 48 22 53 60 60.06 66.43 =MIMI 11113211111 June 350 97 403 02 347 57 402 99 318 90 371.13 535 149 659146 _666,514 716,667 794,010 842,792 875,720 822,367 723 873 833,406 831,830 190 935 514,717 525 834 650,820 132,961 163,419 549,646 566,191 495,568 5171395 502 507 573 730 65813404 68! 794 600 756 604 470 801,196 835 512 77.61 70.09 67.26 ®1=1311111 August 433.23 430 95 400 30 519.15 184.75_ 395 02 309 30 300 46 476.89 143.34 509,054 516 342 667,198_ 611,356 621 009 527 131 604 636 676,266 _ 623,317 671 540 611567 614,265 691,444 722,177 711905 90.57 81.60 76.86 62 61 �� 9 .tomb's 422.49 112 63 377.05 96.03 80.77 79.09 79.10 ��� 90.80 October November 376.54 29595 349 93 273.46_ 276 52 332.65 256.24 253.52 586,982 92.71 570,172 599,698 5701160 657,841 5851193 551,320 573,610 537 294 67.63 51.87 54,70 57 07-111 December 277.89 48.82 48.26 MIMI-NI Total 4 116.18 3 917.86 3 658.63 4 304.26 3 283.23 6 832 427 6 969 288 7 514 086 8,771,300 7 426,761 6 378 376 6,259 931 6 031 933 -3.63% 6 885 288 14.15% 5 889 500 -1 828 25 716.00 ®1111:3111111111=111 687.17 757.80 465.60. -NI %than -4.86% 17.65% 1 2.00% 7.82% 16.73% -1 87% EP pm3 16780 3 017.95 2 616.22 3299 48 3 283 231 4 929 864 5 004 165 5 359 260 6 226 121 7 126 761 4 557 386 4 443 748 4 392 913 5 173 626 5 889500 616.04 533.39 497.04 465.60. MT" _® ®' 1 -MEI= 7.10% 16.18% 19.28% -2.49% -1.14% ® 13.84% 1-®IIIK110111111fIMI®INI 1 III� 111 MI Deoamer 1=1:211 �b ���l� 1 20 129 21 663 23 900 26 528 1 II I. 15 846 _ _ 111M 21 221 111EIFAMIMINIIIIIIMIIMIIIIIIITE=®111101111111MITMIFII 1111101MINEITE1111 11181111111MMIIIIMMITh 17 356 16 479 19 308 30 693 l 18 501 16 714 15 556 MIMI 19 226 marriumnamontramgrommmorn 111=17111111COMMIMIIIIIIMIEM1111131111111111:1111111 IM=1®' �MM�1��.. 16 589 19 716 18 994 26 868 28 612 • 16,376 15,564 15,741 19,026 18,958 1 1.89 1.51 1.41 1,41 1.30 79 17 017 18 569 17 898 16 851 21 291 1.83 1 .51 1.36 1.36 1.28 31 ��®, 111111111}1111111173M®.®MTNINITCOMMITKITIMMERMI - arrimortm®stromminim 17,944 22 330 28 339 15,909 16 258 IIMIITITIIIIININITII20 994 I1®®=111111111111111111111®' FT 20,692 22 666 26 285 11 399 14 951 muumsnrni 19 028 lIIIMMIl®miziminam®m ®=117:11•11.11111111 10.63 IIIMIIIMMIIIIMMIIIIIIITM 19 035 23,674 25 168 1 16 543 16 611 14 785 1111=1 20 761 1 2.30 ®MIKIECIMI®IIIITEMIIETI MINIIIIIIIITX11111•111M111 �� ®'' 11.97 12.91 .12111111MTEEINl ��U 16,177 16 421 IIMEMI� �" 21 501 24 022 23,351 II 15 837 14 063 18 387 II j 19 499 1 2.50 �®���® 26 984 I♦ 17 572 25 615 11111111XIMIIIIIEIMIM®EMINI®FII �. • ®®MITM 14.78 •11111EFMIMI 26 467 111=1.1 17 528 16,322 IMMENTESIIMMIBM111®' 2.65 ®' N� Octob® er � '�® 0.00 '� 21 621 22 305 27 316 0 II 20 994 18 835 ��1 2 99 1- 2.74 k0 00 11=11111=11111=1,11111Z111 '® 0 00 1111=13111 20 777 21 083 29 191 0 1 19 016 19 01 5 19 506 IIIITIFC111111111111111111 2.25 111111MINIMININITrall 0 00 December Illirla/MMXIIII�-' 0 00 •�' 23 900 26 528 0 1 19 345 21 221 17 785 1111/11111111/111111111/111111111111111113111 0.00 m 1 December PIPPIM1 ----_1® 269 291 M4111 3261 220 lrrll 205 1111n111111111-----_ IMEMiri--_ 11121311=11r111M113111M11 383 111111® 237 ®IMMII1-_--_II1 NMI/---1®® 301 307 365 1 205 11111111413111.1113311111F/11111111111111 allEIMI 111111/THENIEM 272 312 378 1 213 252 ®111111021111111U----11 EMMI----111111113® 221 243 325 1 175 203 11111111/111111111111:11®lam -_-NI INIII-----U1213111•11E1111 232 227 256 1 158 11111111311131111111131=1331111------ MMEMI MI 179 1111=1111 215 218 229 NI 170 ®11111111=1®1111311U-----111 1TI ---_1 149 213 172 199 1 146 ��� I ----_NI II 141 147 183 ® 210 151 129 151 � l_� ---� E�1M October----•®®' II 147 176 195 249 196 225 149 160 mourni173 IIIIIIFEMI_ ---ill _ 257 207 11113111111111111Ill 182 II El November ---- 246 ® 338 339 ®IIIMEErli 274 222 -1 -- -1.1 December -- --1 269 291 350 328 �1 259 261 214 -1 111 10/9/01 10/9/01 600.00 500 00 FE 400.00 2 c 300,00 co 0 200,00 100.00 Table 5-3A Monthly Influent Flow /4°7_7 0.00 1 1 I + 1 -1 1 H- f -} f--- --1 e��et �`ep o�J,� � 1/4 P��\ ��� �J�� �J�� J4'J5'� e4p G'`oso so - ems ` 1997 •-U- 1998 -II- 1999 •--x_2000 -*-2001 Million Gallons per Month 120.00 100.00 80.00 60.00 40.00 20.00 - 0.00 - Table 5-3B Rudkin Road Flow -a-1997 -f-1998 --a-1999 --2000 -f-2001 Pounds per Month 1,000,000 9D0,000 8D0,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 Table 5-3C BOD Comparison - H f -1- F I --+ I--- f 4 —I i €2SCN 12'9 4\fS\ i ''SN\ e 4•‘<;)2; 40 cCN SGC `0 - Ja. <<Q) • - 1997 --•-1998 • 1999 —0— 2000 —�--2001 900,000 - 800,000 -- 700,000 600,000 s 0 2 500,000 nLS' co 400,000 0 a 300,000 200,000 - 100,000 - Table 5-3D SS Comparison I -f f f I 4 -1 I- -f i -- f- ei 6 6 er '. �� �� J�� Jew e,c e, e°e�`o ,��J� �e�`J� \- P9 ,J , PJB co Q�e - GN0 o e� -a-1997 --a--1998 --a-1999 -0-2000 -f-2001 Table 5-6 TOTAL ANNUAL Historical and Projected Biochemical (BOD) and Suspended Solids (SS) Plant Loading Pollutant 1997 19913 1999 2000 2001 2002 2003 2004 2005 2006 (lbs) (lbs) (lbs) (lbs) (lbs) (lbs) Test (lbs) (lbs) (lbs) (lbs) est. Year est. est. est. est. BOD Dom/Ind 6,832,427 6,969,288 7,514,086 8,771,300 16.73% 9,112,130 3.89% 9,748,271 6.98% 10,384,413 6.53% 11,020,555 6.13% 11,656,696 5.77% 12,292,838 5.46% %change 2.00% 7.82% Del Monte (11,000 X 7i) 506,398 825,000 825,000 825,000 825,000 825,000 825,00 TOTAL 6,832,427 6,969,288 7,514,086 9,277,698 9,937,130 10,573,271 11,209,413 11,845,555 5.68% 12,481,696 5.37% 13,117,838_ 5.10% 2.00% 7.82% 23.47% 7.11% 6.40% 6.02% SS Dom/Ind 6,378,376 6,259,031 6,031,933 6,885,286 6,712,065 6,841,428 6,970,791 7,100,154 7,229,517 7,358,881 1.79% %change -1.87% -3.63% 14.15% 2.52% 1.93% 1.89% 1.86% 1.82% Del Monte (1,500 X 75) 130,130 112,500 112,500 112,500 112,500 112,500 112,500 TOTAL 6,378,376 6,259,031 6,031,933 7,015,416 6,824,565 6,953,928 7,083,291 7,212,654 1.83% 7,342,017 1.79% 7,471,381_ 1.76% -1.87% -3.63% 16.30% -2.72% 1.90% 1.86% 9/19/01 Table 5-7 Retail Sanitary System # Customer Accounts by User Group Billing Category 6/4/98 9/29/99 6/29/00 3/27/01 2002 2003 2004 2005 2006 and Description Actual Actual Actual Actual Est. Est. Est. , Est. Est. Test Retail Owner (City) Year S11 Residential Sewer 16,966 17,087 17,174 17,330 19,557 19,655 19,753 19,852 19,951 S12 Commercial Sewer 1,649 1,709 1,722 1,743 1,790 1,799 1,808 1,817 1,826 S13 Industrial Sewer 21 10 1 0 10 10 10 10 1 0 1 0 S14 Govemmental Sewer 81 79 80 78 8 9 90 9 0 9 0 9 0 S15 Interdepartmental Sewer 31 34 35 26 26 26 26 26 26 S31 Residential Unmetered Sewer 114 110 108 102 103 104 105 106 107 S32 Commercial Unmetered Sewer 7 6 6 6 7 7 7 7 7 S33 Industry Unmetered Sewer 1 1 1 1 1 1 1 1 1 S35 Static Charge Residential 10 10 10 1 0 48 48 48 48 48 S75 Interdepartmental Sewer 1 discontinued subtotal inside City (2) 18,881 19,046 19,146 19,306 21,631 21,740 21,848 21,957 22,066 Percent Change 0.87% 0.53% 0.84% 12.04% 0.50% 0.50% 0.50% 0.50% .(2). Retail Non -owner (County) S21 Residential Sewer 2,165 2,275 2,443 2,287 238 248 258 268 279 S22 Business Outside Sewer 60 49 49 40 4 4 4 4 4 S24 Govemmental Sewer 13 13 1 3 12 1 1 1 1 1 S41 Static Sewer Residential 44 40 47 40 4 4 4 4 4 S42 Commercial Unmetered Sewer 1 1 1 1 0 0 0 0 0 subtotal outside City (2) 2,283 2,378 2,553 2,380 247 257 267 277 288 Percent Change 4.16% 7.36% -6.78% -89.62% 4.00% 4.00% 4.00% 4.00% Total Users (1) 21,164 21,424 21,699 21,686 21,878 21,997 22,115 22,234 22,354 Percent Change 1.23% 1.28% -0.06% 0.89% 1.43% 1.08% 1.08% 1.08% Percent of Total Inside 89.21% 88.90% 88.23% 89.03% 98.87% 98.83% 98.79% 98.75% 98.71% Outside 10.79% 11.10% 11.77% 10.97% 1.13% 1.17% 1.21% 1.25% 1.29% (1) Excludes Terrace Heights and Union Gap service areas. (2) Assumes annexations of 90% of existing retail Non -Owner customers. 9/19/01 TABLE 5-8 Retail Wastewater Customers # Accounts by Meter Size 9/19/01 Actual Actual Actual 6/29/00 Actual 3/24/01 Projected 2002 Projected 2003 Projected 2004 Projected 2005 Projected 2006 Meter 6/4/98 9/29/99 Size Accounts Accounts Accounts Accounts Accounts Accounts Accounts Accounts Accounts Test Year City •(2)• 20,112 20,213 20,314 20,416 20,518 3/4" 17,448 17,555 17,648 17,818 1" 916 948 947 936 944 949 954 959 964 1.5" 217 225 230 232 243 245 246 247 248 2" 185 208 210 205 211 212 213 214 215 3" 73 72 73 76 78 78 78 78 78 4" 38 35 35 34 34 34 34 34 34 6" 2 2 2 1 1 1 1 1 1 8' 0 0 0 0 1 1 1 1 1 10" 1 1 1 1 1 1 1 1 1 subtotal 18,880 19,046 19,146 0.53% 19,303 0.82% 21,626 12.04% 21,734 0.50% 21,842 0.50% 21951 0.50% 22,S/160 0.50% %increase 0.88% County •(2)• 3/4" 2,257 2,352 2,529 4 2,356 3 245 0 255 0 265 0 276 0 287 0 1" 5 4 1.5" 12 12 11 11 1 1 1 1 1 2" 6 7 6 6 1 1 1 1 1 3" 2 2 2 2 0 0 0 0 0 4' 0 0 0 0 0 0 0 0 0 6' 0 0 0 0 0 0 0 0 0 8" 1 1 1 1 0—_ 0 0 0 0 10" 0 0 0 0 0 0 0 0 0 subtotal 2,283 2,378 2,553 7.36% 2,379 -6.82% 247 -89.62% 257 4.00% 267 4.00% 278 4.00% 289 4.00% % increase 4.16% Total 21,163 21,424 21,699 21,682 21,873 21,991 22„109 22,229 1.63% 22`149 1.63% % increase 1.23% 1.28% -0.08% 2.10% 1.35% 1.97% County % of Total 10.79% 11.10% 11.77% 10 97% 1.13% 1.17% 1.21% 1.25% 1.29% (1) Excludes Terrace Heights and Union Gap service areas. (2) Assumesand nexatior90% of existine retail Non -Owner customers. 9/19/01 Table 5-9 Retail Wastewater Customers Meter Equivalents Meter AWWA Actual Actual Actual Actual 2001 Projected 2002 Pro'ected 2003 Pro'ected 2004 Pro'ected 2005 Pro'ected 2006 Size Factor 1998 1999 2000 E.uivalent Equivalent Equivalent Equivalent Equivalent Test E.uivalent Equivalent E•uivalent E•uivalent _ _- 1.00 Year CR 3/4" 17,448 "(21* 17,555 17,648 17,818 20,112 1,199 399 20,213 1 205 401 20,314 1 211 403 20,416 1 217 405 20,518 1 223 407 1" 1.27 1 163 1 204 1,_203 1189 1.5" 1.64 356 369 377 380 2" 2.64 488 549 554 541 557 560 563 566 569 3" 10 00 730 720 730 760 780 784 788 792 796 4" 12.73 484 446 446 433 433 435 437 439 441 6" 19.10 38 38 38 19 19 19 19 19 19 8" 26 36 0 0 0 0 26 26 26 26 26 10" 40.00 40 40 40 40 40 40 40 40 40 subtotal 20,748 20,921 21,036 21,180 23 565 23,683 23,801 23,920 24,039 % increase _- 0.84% 0 55% 0 69% 11.26% 0 50% 0.50% 0.50% 0.50% Co _- 1 00 2 257 .(2 . 245 3/4" 2 352 2 529 2 356 255 265 276 287 1" 1 27 6 5 5 4 0 0 0 0 0 1.5" 1.64 20 20 18 18 2 2 2 2 2 2" 264 16 18 16 16 3 3 3 3 3 3" 10.00 20 20 20 20 0 0 0 0 0 4" 12.73 0 0 0 0 0 0 0 0 0 6" 19.10 0 0 0 0 0 0 0 0 0 8" 26 36 26 26 26 26 0 0 0 0 0 10" 40.00 0 0 0 0 0 0 0 0 0 subtotal 2,345 2,442 2,614 2,440 249 260 270 281 292 % increase 4 11% 7.07% -6.67% -89.78% 4.30% 3.85% 4.07% 3.91% Total 23,093 23,362 23,650 23,620 23,814 23,943 24,071 24,201 24,331 % increase 1.17% 1.23% -0.13% 0.82% 0.54% 0.53% 0.54% 0.54% Coun % of Total 10.16% 10 45% 11.05% 10.33% 1.05% 1.09% 1 12% 1.16% 1.20% (1) Excludes Terrace Heights and Union Gap service areas. (2) Assumes annexations of 90% of existing retail Non -Owner customers. I I l I I_ 9/19/01 SECTION 6 PRETREATMENT PROGRAM History: The City's Wastewater Pretreatment Program began in earnest in 1988. "The purpose of a local pretreatment program is to protect the environment from adverse impacts that can occur when hazardous or toxic wastes are discharged into a sewer system. Generally, this protection is achieved though regulation of nondomestic (industrial) users that discharge toxic wastes or unusually strong wastes... These users are required under the program to treat the hazardous or toxic wastes at their highest concentration point, before they are introduced into the sewer system and treatment plant. Such pretreatment fulfills the objectives of the federal and state pretreatment program by preventing: 1) the introduction of nondomestic wastes that interfere with POTW operations; 2) the pass-through of pollutants without being removed because the POTW is not designed to remove them; 3) the contamination of municipal sludge by the removal of certain pollutants by the POTW and 4) the exposure of treatment plant workers (and by extension sewer collection maintenance workers) to chemical hazards" (Cited from the March 27, 1989 memorandum from Preston Thorgrimson, pages 5 and 6). Municipalities, such as Yakima, are strictly liable under the Clean Water Act. See, e.q., Mumford Cove Ass'n v. Town of Groton, 640 F. Supp. 392 (D. Conn. 1986). 'Thus, NPDES (National Pollutant Discharge Elimination System) permit or pretreatment violations are not excusable because the regulatory requirements are technical or insignificant, or are difficult or impossible to meet"' (same Preston Thorgrimson citation as above, page 9). Previous Council items submitted on this issue include, but are not limited to, the following: 1) March 21, 2000 Study Session on Additional Mandates from EPA and Ecology; 2) "Update on Pretreatment Submittals," dated October 12, 1999; 3) "Pretreatment Submittals," dated August 24, 1999; 4) "Terrace Heights and Union Gap Pretreatment," dated April 30, 1999; 5) "Status of Multi jurisdictional Pretreatment Agreement and Analysis of Fully Delegated Pretreatment Program Requirements in New NPDES Permit," dated November 7, 1997; 6) "New Significant Industrial User Promulgation," dated October 22, 1996; 7) "Multi - jurisdictional Agreements," dated April 4, 1996; 8) May 4, 1993 Study Session on the City's NPDES Discharge Permit; 9) "1993 Wastewater NPDES Discharge Permit" dated January 8, 1993; 10) Wastewater Pretreatment Study Sessions on July 7, 1992 and April 7, 1992; and 11) "Report on New Federal and State Mandated Wastewater Quality Standards and Regulations," dated June 4, 1991. Federal and State mandates outlined a series of tasks the City was required to complete to maintain NPDES discharge permit compliance. These included: 1) completion of an Industrial Waste Survey identifying known and suspected Significant Industrial Users (Sills); 2) adoption of an updated Sewer Use Ordinance including permitting authority; 3) adoption of Special Agreements with the City of Union Gap and the Terrace Heights Sewer District insuring complete 2001 COS Section 6 Page 1 in �nni and adequate implementation of the National Pretreatment Program; 4) calculations of technically based local discharge limits; 5) a listing of staff and resources available to implement the Pretreatment Program; 6) a letter from the City Attorney stating the City has the legal authority to implement a pretreatment Program; and 7) a request for fuli delegation of the Pretreatment Program. These tasks have been completed. Ecology has not yet responded to these documents. However, full delegation is expected in our next permit, due in July, Inn. Service Unit: In the 1994 Cost of Service Study (COS), a unique Service Unit (SU 233) was initiated which identified all expenses associated with the City's Pretreatment Program, a fee schedule was adopted for services provided, and rates were established to be charged to the appropriate customers. Additional mandates from the Department of Ecology require that the fee schedule and rates for this service unit be updated to reflect increase expenses. Rate Policy Options: The fee schedule adopted with the 1996 COS intended to shift 75% of the cost of the program to the pretreatment customers. This COS continues that philosophy. This philosophy removes 75% of the cost burden of the mandated pretreatment program from the city retail rate payer and reduces the level of necessary city retail rate increases. Unfortunately, due to over -estimation of the number of the city's MIU customers, current rates shift only 41% of the program cost to the affected businesses. Cost Recovery: Recovery of the costs associated with the Pretreatment Program is mandated under 40 CFR 403.8 (f) 3. "The POTYshall have sufficient resources and qualified personnel to carry out the authorities and procedures in paragraphs (f) (1) and (2) of this section (Pretreatment Program Responsibilities)". The businesses within the program fall into one of two categories: Significant Industrial Users (SIU's) or Minor Industrial Users (MIU's). A business becomes an SIU if it meets any of the following thresholds; 1. Having a business type listed under 40 CFR 405-471. 2. Discharges more than 25,000 gallons per day of process wastewater. 3. Contributes more than 5% of the dry weather loading of the Treatment Facility. 4. Is designated because of its potential to significantly impact the Treatment Facility. All other businesses are MIU's. 2001 cos Section 6 Page 2 llrrnhwr n lnni The EPA "Guidance Manual for POTW Pretreatment Program Development" discusses three possible methods of cost recovery which the City could utilize: 1) Service Charges: Businesses are charged based on the service performed (inspection, sampling, etc.) plus an accounting adjustment at the end of each year to cover additional expenditures. This method is very labor intensive because of the amount of record keeping required and the complex calculations involved in determining charges. This method is currently being used when billing Significant Industrial Users (SIU's) because of the limited number of businesses involved and the wide divergence of tests involved. 2) Industry Surcharge: Businesses are charged a flat rate surcharge to finance the Pretreatment Program. Specific Standard Industrial Codes (SIC) that are monitored by the Pretreatment Program due to the generalized characteristics or strength of their waste are charged through a utility billing system. This method has the advantage of using the current billing system. Staff uses this method on Minor Industrial Users (MIU's) because of the larger number of businesses involved. 3) Pollutant Strength Charge: Businesses are charged according to the amount of pollutants discharged. This gives incentive to business to reduce the amount of pollutant discharge. However, it is geared toward conventional pollutants and does not address toxic pollutants. This method is currently in use to recover costs for the treatment of strong waste (circa 1982) and is not suggested for financing the Pretreatment Program. 4) Discharge Permit Fees. The City of Yakima Pretreatment Program is scheduled to receive full delegation with the issuance of our next NPDES permit, scheduled for July 1, 2002. Delegation gives the City authority and responsibility under the Clean Water Act to issue discharge permits to commercial and industrial dischargers within the city's service area. This COS proposes to collect permit fees from the affected businesses to offset the costs of the fully delegated program. Staffing Impacts: Table 6-6 shows the staffing levels that Ecology uses for managing discharge permits. Using Ecology as a guide, the City's fully delegated pretreatment program would be expected to have 5.48 FTE's involved in permit management and field inspections. This does not include program management, clerical support, engineering, or laboratory staffing. The City's Pretreatment Program currently has 1.84 FTE's available to perform field inspections for the City's Pretreatment and Strong Waste Programs. The projected additional staffing requirement of the delegated pretreatment program is 3.64 FTE's. This is lower than the 5-14 additional FTE's listed in the 2000 Wastewater Facilities Plan. The higher projections were based on draft EPA regulations for pretreatment programs. These regulations, while still draft, have been significantly reduced in scope and severity under the Bush administration. 2001 COS Section 6 Page 3 n,•rnhnr 1n 7nn1 Pretreatment Expense Analysis and Recovery Options: Table 6-2 outlines the annual budget projected through the planning period. Wastewater staff closely monitors new EPA mandates in this area. Current EPA rulings suggest the requirement'' of three additional staff (1 permit writer, 2 field personnel), one vehicle, and equipment by mid 2002. This report recommend. this increase in this mandated program. The budgeted 2002 cost total is projected to be $729,505. This increases to $819,347 by the year 2006. This includes additional lab staff and expenses. Proposed Charges for Affected Businesses: Table 6-2 also presents the proposed Pretreatment Fee and Charge Schedule for the affected business community. Businesses in Union Gap and Terrace Heights are not included in this list. Those two entities are responsible for their own pretreatment activity within their own service areas. However, Union Gap and Terrace Heights will be billed for the sampling and testing the City does on their effluent per the hourly rates and fee schedule on tables 6-3, 6-4, and 6-5. Fees for Significant Industrial Users (SIU) and Minor Industrial Users (MIU) are analyzed separately. The fee of $3,880/year shown on Table 6-2 is an estimate of the average total cost, including tax, necessary to monitor the average business in the SIU class for 2002. That cost includes permit, sampling and laboratory fees found on Table 6-3. The intent of this fee schedule is that the SiU's are billed directly, through invoice, by the City for actual service rendered. The billing to city customers would be adjusted by the 25% cost share proposed. The average city SIU would pay $2,910 in 2002. These fees would be subject to increase during the period through 2006. NAIi I'c outside the city %sinI IIrl be billed $60 per msvnth ($120 00 on their bimonthly ..��v v vaaw�aaa. the city ♦.vuI J be billed wvv per 11 ivI ni 1 �w 1 w.vv on their II bimonthly ivI 1u ny utility bill) for pretreatment program fees ($720 annually) reflecting the presence of the business in the Pretreatment Program. This charge is proposed for the entire period through 2006. Not all MIU's will be tested in any year. However, testing, which includes a 4 -day sampling regimen, will be performed on as many of each SIC code which can be scheduled in a year. The remaining charge per business covers the costs of administering the program which includes archiving, potential billing system changes, statistical analysis, and other applied program costs. MIU's within the city would be billed 445 per month ($90.00 on their bimonthly utility bill) for pretreatment program fees ($540 annually). This fee reflects a 75%-25% cost share with the business and city retail customers. 2001 cos Section 6 Page 4 n,•rnhor in )nn1 Pretreatment Fee and Charge Schedule: Table 6-3 identifies the presently proposed charges for basic sampling and testing, complex laboratory testing, and other flat rate charges for related services for 2002. The Pretreatment Fee and Charge Schedule, Table 6-3, derives its costs from Tables 6-4 and 6-5. These costs are based upon 2002 expenses and are subject to annual inflationary increases. The basic one and multi- day sampling schedule includes sampler set-up and collection costs, administrative cost, and laboratory costs for Biochemical Oxygen Demand (BOD), Suspended Solids (SS), and pH, to generate a basic cost. "Laboratory Fees" also include more complex testing that may be required by the program in addition to the basic tests. Some of the complex and more costly laboratory testing is done by "outside" laboratories because of equipment requirements. The "Flat Rate Fees" include "Discharge Authorization" is required mainly for disposal of groundwater generated by removal of underground storage tanks. This fee is valid for the first 50,000 gallons of water so disposed, administration, and oversight of the remediation project for wastewater purposes. Video inspection is included as a service as well as dye and smoke testing. These services are provided both on a charged and non -charged basis depending on the nature of the job request. The above fee schedule covers only the expense of testing and monitoring. These fees do not cover any costs associated with treatment of pollutants discharged from any customer. Treatment of constituents allowed in the waste stream may be billed in addition to the testing fees. Strong waste surcharges for discharges of BOD and SS in concentration exceeding 300 ppm would be in addition to these proposed pretreatment fees. Other charges include services performed by Pretreatment or other wastewater division employees at the request of and for the benefit of customers. Services include: compliance inspections, dye testing, smoke testing, Tv-ing for location, these services are billed per crew hour at the rates indicated in Table 6-3. In 1998, Wastewater adopted a policy of requiring a TV inspection of all new construction prior to final acceptance as a part of the city's collection system. Developers/contractors have their choice of who performs this activity. If they choose to hire City services, the price is per foot as indicated on Table 6-3. Fats, Oils, and Grease Program During the year 2000, the Wastewater Division paid a total of $65,643 in sewer backup claims. 80% ($52,399) were attributed to grease. The Sewer Collections workgroup spent $180,825 on routine maintenance of sewer lines because of grease related issues. Twenty-four percent (24%) of emergency callouts, totaling $32,636, were attributed to grease. Operations and maintenance staff at the treatment facility spend approximately $10,000 per month on grease related tasks. 2001 COS Section 6 Page 5 r .-f h.r i n lnnl To summarize: Grease Expense 2000 cost Sewer Backup Claims $52,399 Sewer Collections Maintenance $180,825 Sewer Collections Emergencies $32,636 Treatment Plant Maintenance $120,000 Total $385,860 These are normal costs associated with grease. The Treatment Plant has recent y been receiving discharges of greaca that have not vat peen irientified �owrq�f�.�e ra�eae+s eea ves.e..., .,.....+. a,.. .., .,.... y. ..,. .......,. .. ..... ......� ..�. ��. .. ........ The material does notfloatlike normal grease, but sinks and binds to the raw sludge. This sludge/grease mixture is clogging pipes and causing increased operations and maintenance costs at the treatment facility. Identifying and removing this material from the collection system is the top priority of the pretreatment program. However, the Targe size of the collection system, Targe number of commercial and industrial dischargers, and limited staff resources make the identification and location of this material a slow process that has not been completed. The Wastewater Division is considering a fats, oils, and grease (FOG) fee to shift the cost burden of this element of the Pretreatment Program to the appropriate businesses. There are also regulations pending at EPA that would require us to institute a FOG program. The City and the Uniform Plumbing Code currently require grease traps on all new food establishments. The City can require establishments that don't have grease traps to install them. The City can also require a new grease trap if the current one is undersized or not working properly. There are currently 471 businesses licensed by the Health District to serve food in the city of Yakima. These businesses include restaurants, grocery stores, mini -marts and institutions such as schools, nursing homes, and correctional facilities. The FOG program starts with education. The Wastewater Division is researching a number of multi-lingual educational materials including: • Brochures that outline the problems and costs associated with improper grease management; • Waste reduction plans for food establishments; • Maintenance schedules for grease traps; • Signs for the kitchen area that read "Dump No Grease"; • A list of vendors that recycle grease; • A Iict of vanrinrc that pi imp graaca tranc 2001 COS Section 6 Page 6 )nnl All of this information will be provided to the food establishments. We are planning on meeting with the Restaurant Association and other organizations to discuss grease management. Once the education program is well established, we propose to begin inspections of the establishments. Because of the large number of establishments, we are planning on quarterly inspections. Once the program is underway for a year or so inspection frequency will be adjusted. Some establishments may requirement inspections on a monthly basis, while others can be reduced to yearly. Because is a significant portion of grease that is residential in nature, the FOG program would also have an educational program for residential customers. Based on the number of establishments, this program would require 1.72 FTEs in addition to staff identified for other tasks. If a two person crew is hired, the fully loaded annual cost to the City, including a vehicle and operating supplies, is approximately $118,000. If half of the grease related problems can be eliminated, there would be a net savings of $74,930 per year. We target the removal of greater than half the problem, but concede that not all grease can be eliminated from the system. We intend to initiate this program with the additional field personnel outlined in "Pretreatment Expense Analysis and Recovery Options". Conclusion: Staff seeks Council direction to enact this fee and charge plan to lessen the impact on city retail rate payers for the Pretreatment Program. This section represents the implementation framework for allocating mandated pretreatment program costs to businesses State and Federal environmental regulations require the City to monitor. This proposal continues a cost to conduct the MIU program on Table 6-2. Businesses within the city would be charged only 75% of the full cost rate. The balance is included within the proposed city retail rate This proposal would initiate a Fats, Oils, and Grease (FOG) reduction program as part of the Pretreatment Program as staff and equipment become available. This Proposal would set the testing fee schedule as shown on Table 6-3. These rates would be charged for requested testing and testing done for entities outside the city. However, businesses within the city's collection system would be charged only 75% of the rates shown for in-house services. The balance is included within the proposed city retail rate. 2001 COS Section 6 Page 7 r ,.s,,hor in )nn+ Recommendation: Staff recommends that approval be given to hire additional staff as outlined in this section; one permit writer and two field personnel. Staff recommends that formal direction be given to draft the enabling legislation for the charge and fee schedule shown on Tables 6-2 and 6-3 of this report. 2001 COS Section 6 Page 8 (lnfnhcr 1n 7nn1 Table 6-1 Required Monitoring Page 1 of 2 The City is required by its National to monitor its effluent 6 times a measures the Acute and Chronic water flea. The City located a toxicity passed all the toxicity tests and permit. Items marked with an 'effluent, or biosolids at the treatment monitoring for these chemicals Pollution Discharge Elimination System (NPDES) permit year using a Whole Effluent Toxicity (WET) test. This test toxicity of the effluent to Ceriodaphnia Pulex, a type of source and removed it in 1999. Since then we have hope to reduce the monitoring frequency in the upcoming "X" have been detected at least once in the influent, plant during the last six years. We are not during this permit cycle, however that may change. Metals ! Pesticides cont. Ag -SILVER X .ENDOSULFAN SULFATE AI -ALUMINUM ; X ' 4,4 -DDT X As -ARSENIC , X i METHOXYCHLOR Ba -BARIUM ! X ICHLORDANE X Be -BERYLLIUM . X ' (TOXAPHENE Ca -CALCIUM X ' iAROCHLOR-1016 Cd -CADMIUM X , 1AROCHLOR-1221 Cr -CHROMIUM , X , IAROCHLOR-1232 Cu -COPPER X ,AROCHLOR-1242 Fe -IRON X AROCHLOR-1248 Hg -MERCURY X ,AROCHLOR-1254 X Mg-MAGESIUM X AROCHLOR-1260 Mn-MANGENESE X Mo -MOLYBDENUM X 'Volatile Organics Na -SODIUM X CHLOROMETHANE X Ni -NICKEL X , VINYLCHLORIDE Pb -LEAD X BROMOMETHANE X Sb -ANTIMONY X CHLOROETHANE Se -SELENIUM X , TRICHLROFLUOROMETHANE X TI -THALIUM ACROLEIN Zn -ZINC X '1,1-DICHLOROETHYLENE ASBESTOS METHYLENE CHLORIDE X CYANIDE X ACRYLONITRILE X TRANS-1,2-DICHLOROETHYLENE Pesticides ' 1,1-DICHLOROETHANE ALPHA -BHC ;CHLOROFORM X BETA -BHC 1,1,1 -TRICHLOROETHANE X DELTA -BHC ;CARBON TETRACHLORIDE GAMMA -BHC BENZENE HEPTACHLOR 1,2-DICHLOROETHANE ALDRIN 1,1,2 -TRICHLOROETHYLENE X HEPTACHLOR EPDXIDE 1,2-DICHLOROPROPANE ENDOSULFAN I X . . BROMODICHLOROMETHANE DIELDRIN 2-CHLOROETHYLVINYLETHER 4,4 -DDE X TRANS-1,3-DICHLOROPROPENE ENDRIN ` ' X ; 'TOLUENE X ENDOSULFAN II CIS-1,3-DICHLOROPROPENE 4,4 -DDD I X ' '1,1,2 -TRICHLOROETHANE X ENDRIN ALDEHYDE 1TETRACHLOROETHYLENE X CHLORODIBROMOMETHANE !4-CHLOROPHENYL PHENYL ETHER 1 CHLOROBENZENE 4,6-DINITRO-O-CRESOL 7/23/2001 Table 6-1 Required Monitoring Page 2 of 2 Volatile Organics ;Semi -Volatile Organics ; ETHYL BENZENE ! X N-NITROSODIPHENYLAMINE X BROMOFORM j 1,2-DIPHENYLHYDRAZINE 1,1,2,2 -TETRACHLOROETHANE 14-BROMOPHENYL PHENYL ETHER HEXACHLOROBENZENE Volatile Organics PENTACHLOROPHENOL Hazardous Substance List PHENANTHRENE X ACETONE X (ANTHRACENE CARBON DISULFIDE X ! Di -N -BU T YLPH T HALATE j X VINYL ACETATE I FLUORANTHENE X 2-BUTANONE (MEK) X I BENZIDINE 4-METHYL-2-PENTANONE (MI X 'PYRENE X 2-HEXANONE BENZYL BUTYL PHTHALATE; X TOTAL XYLENE X STYRENE I BENZO(a) ANTHRACENE ; X ;CHRYSENE X 13,3'-DICHLOROBENZIDINE Semi -Volatile Organics BIS (2-ETHYLHEXYL) PHTHAI X N-NITROSODIMETHYLAMINE DI-N-OCTYL PHTHALATE PHENOL X I BENZO(b)FLUORANTHENE ; X BIS (2-CHLOROETHYL) ETHER Ir ,��., r� � � 11 I1 ��Tt �r• r ENZO(k)FLUORAN 1 HENS X 2 -CHLOROPHENOL I BENZO(a)PYRENE 1,3 -DICHLOROBENZENE 1,4 -DICHLOROBENZENE 1,2 -DICHLOROBENZENE I INDENO(1,2,3-CD)PYRENE DIBENZO(A,H)ANTHRCENE I BENZO(G,H,I)PERYLENE BIS (2-CHLOROISOPRO Y L) ETHER N-NITROSODI-N-PROPYLAMINE !Semi -Volatile Organics HEXACHLOROETHANE I Hazardous Substance List NITROBENZENE ;ANILINE ISOPHORONE 'BENZYL ALCOHOL 2-NITROPHENOL 2-METHYLPHENOL X 2,4 -DIMETHYLPHENOL I4-METHYLPHENOL X BIS (2-CHLOROETHOXY) METHANE :BENZOIC ACID X 2,4-DICHLOROPHENOL 4-CHLOROANILINE X 1,2,4-TRICHLOROBENZENE 2 -METHYLNAPHTHALENE X NAPHTHALENE X 2,4,5 -TRICHLOROPHENOL HEXACHLOROBUTADIENE 2-NITROANILINE 4-CHLORO-3-METHYI PHENOL i3-NITROANILINE HEXACHLOROCYCLOPENTADIENE ,DIBENZOFURAN X 2,4,6 -TRICHLOROPHENOL i4-NITROANILINE 2-CHLORONAPHTHALENE CARBAZOLE ACENAPHTHYLENE X COPROSTANOL X DIMETHYL PHTHALATE X 2,6-DINITROTOLUENE ACENAPHTHENE 2,4-DINITROPHENOL 4-NITROPHENOL 2,4-DINITROTOLUENE FLUORENE X DIETHYL PHTHALATE X 7/23/2001 Table 6-2 Pretreatment Program (Service Unit 233) Expenses PROPOSED RATES Account Descri.tion Actual Actual Actual Estimate Estimate Estimate Estimate Estimate Estimate Multi. ler No. 1998 1999 2000 2001 2002 2003 2004 2005 2006 02-06 EXPENSE Bud. et Test Year Existing Program see table 4-7 346 512 403 149 403 060 391 505 498 086 520 286 532 812 545 675 558 883 MANDATED Full D Delegated Program (Pre -treat) see Table 4-7 200,500 206,515 212,710 219,092 225,665 1.030 Delegated Program (Lab) see Table 4-7 30,919 31,846 32,801 33,786 34,799 1.030 Subtotal Fully Delegated Program 231,419 238,361 245,511 252,878 260,464 Total Mandated Pro. ram 346,512 403,149 403,060 391,505 729 505 758,647 778,323 798.553 819,347 %Chan.: 16.34% -0.02% -2.87% 86.33% 3.99% 2.59% 2.60% 2.60% REVENUE Budet allocation to Wholesale customers of basic .ro.ram $31,320 $39 847 $41.623 $42,625 $43,654 $44,711 SUBTOTAL Retail Customers $360,185 $689,658 $717,024 $735,698 $754,899 $774,636 $50,426 $96,552 $100,383 $102,998 $105,686 $108,449 Total Ci Retail Customers - $410,610 $786,210 $817,407 $838,696 $860,585 $883,085 Less est Annual Char.e Sills $33,503 $34 508 $35,543 $36,610 $37,708 $38,839 1.030 Less (est) Annual permit fees S175 000 $400 000 $420 000 $441,000 $463 050 1.050 Total Annual Charge SIU's $33,503 $209,508 $435,543 $456,610 $478,708 $501,889 Estimated 8 SIU's 30 54 1 1 1 114 118 121 1.030 Average Annual cost per SIU $1 117 S3 880 $3,924 $3 994 $4 065 $4 138 Pro•ose Rate w/ Cost Share @75% In Cit $838 $2 910 $2 943 $2 995 $3 049 $3 103 Less est Del Monts Testing (ED75% in Cit $10 125 10,429 10 742 11,064 11,396 1.030 Total Annual Char.: MIUs Estimated # MIUs - $377,107 $566 577 $371,435 $371,345 $370,813 $369,800 471 480 490 500 510 520 1.020 Full Cost per MIU $801 $1,179 $758 $743 $727 S711 Full Cost Monthly Bill $67 $98 $63 $62 $61 $59 Existing/Proposed Rate $35.70 $60 $60 $60 $60 $60 Pro.ose Rata w/ Cost Share ''75% In Cit $27 $45 $45 $45 $45 $45 Total Revenue $162,798 $164,390 $181,875 $466,530 $643,324 $665,731 $689,055 $713,335 Wastewater Revenue $142,805 $144,202 $159,539 $409,237 $564,320 $583,975 $604,434 $625,733 Utility tax $19,993 $20,188 $22,336 $57,293 $79,005 $81,756 $84,621 $87,603 City Cost Share $260,344 $258,858 $231,966 $320,268 ;194,327 $194,349 $194,119 $193,614 % Cost Share 65% 64% 59% 44% 26% 25% 24% 24% 10/8/01 Taw 64 Individual Testing Fees Task Pretreatment Sampling Laboratory (3) Total Cost Crew hrs. Sampling(3) 1 Day !includes setup 1.50 $222.68 $84.55 k $307.23 each additional day per setup 0.50 $86.22 $84.55 $170.77 (1) Includes sampler set up and pickup. (2) includes statistical analysis and billing program changes to Customer Service. (3) includes BOD, SS and pH. Other tests additional, schedule found below. Laboratory Fees ...• ■ • b Cost BOD -Biochemical Oxygen Demand 0.50 Conv. $33.82 $33..82 $16.91 $50.73 These tests are what TSS -Total Suspended Solids 0.50 Cony. is included in pH 0.25 Conv. 'Laboratory" above BOD soluble 0.75 Conv. COD 0.50 Conv. $33.82 COD soluble 0.75 Conv. $50.73 TDS- Total Dissolved Solids 0.50 Conv $33.82 Alkalinity (Carbonate) 0.25 Conv. $16.91 Ammonia (Ion Selective Probe) 0 25 Conv. $16.91 Chlorine Residual (Colorimetric) 0 25 Conv. $16.91 Dissolved Oxygen (Azide) 0.25 Conv $16.91 Dissolved Oxygen (Membrane) 0 25 Conv $16.91 Fecal Coliform 0 75 Conv $50.73 FOG -Fatty, Oils & Grease 1 00 Conv. $67.64 k/PN 5.00 Conv. $338.20 Nitrate 0 50 Conv. $33.82 Nitrite 0 50 Conv. $33.82 Organic/Volatile Acids 0.25 Conv. $16.91 Total Volatile Solids 0.50 Conv $33.82 BNA (Semivolatiles) (1) outside AA/GC market cost BTEX 2.00 AA/GC $198 48 Metals (AA) 2 50 AA/GC $248.10 Metals (Graphite Furnace) 3 50 AA/GC $347,34 Pesticides/ PCB's 5.50 AA/GC $545.82 TPH (1) outside AA/GC market cost Volatile Organics 2.00 AA/GC $198 48 (1) Testing done by outside lab. Flat Rate Fees Cost Discharge Authorization Lump Sum see text $400.00 Compliance Inspection per hour $136 46 Dye testing per hour $136 46 Smoke testing per hour $50 00 TVing location per hour $260.00 TVing new construction per linear foot $1 60 NOTE: All fees shown Include City Utility Tax, currently 14%,, Glossary BTEX- Benzene, Toluene, Ethylbenzene, and Xylene- Highly volatile hydrocarbons. BNA -Base Neutral Acids-Semivolatile Organic compounds. Trri-Tdiai Petroleum Hydrocarbons -includes oils, gasoline, diesel, and miler fuels. 9/1 9/01 TABLE 6-4 Analysis of Laboratory Expenses 2002 CONVENTIONAL TESTING AA/GC TESTING Total Annual Cost Available Available LABOR Time Time Manager $94,010.00 2% $1,880.20 0 0.5% $470.05 0 Assist. Manager $82,292.00 10% $8,229.20 0 3% $2,468.76 0 Lab Co -Ord. $63,088.00 70% $44,161.60 0 30% $18,926.40 0 Wood $54,859.00 100% $54,859.00 1,660 0% $0.00 0 Jongeward $52,876.00 100% $52,876.00 1,660 0% $0.00 0 Schafer $52,876.00 90% $47,588.40 1,494 10% $5,287.60 166 Future (1) $51,682.57 100% $51,682.57 1,660 0% $0.00 0 Price $60,630.00 0% $0.00 0 100% $60,630.00 1,660 Subtotal Labor $261,276.97 6,474 $87,782.81 1,826 OTHER EXPENSES Utilities $5,250.00 $1,050.00 Equip. Maint. $2,500.00 $10,350.00 Equip. Deprec. $8,000.00 $17,500.00 Chemicals $4,200.00 $3,150.00 Capital Debt $65,000.00 $22,180.00 Materials $1,000.00 $1,500.00 Consumables $2,000.00 $1,000.00 Subtotal Other $87,950.00 $56,730.00 Subtotal Expense $349,226.97 $144,512.81 City services/admin. 10% $34,922.70 $14,451.28 Subtotal $384,149.67 $158,964.09 City Utility tax 14% $53,780.95 $22,254.97 TOTAL 2002 EXPENSE $437,930.62 $181,219.06 Hourly cost for Conventional Testing $67.64 Hourly Cost for AA/GC Testing $99.24 7/26/01 Table 6-5 Analysis of Pretreatment Field Crew Expenses 2002 PREIHEATMENT PROGRAM FIFI DCREW Total Available LABOR Annual Cost Time (hrs.) 0 Manager $94,010.00 3% $2,820.30 Hobbs $73,543.00 60% $44,125.80 0 Neumeyer $54,860.00 100% $54,860.00 1,660 Garehime $54,198.00 100% $54,198.00 1,660 Future 1 $52,832.44 100% $52,832.44 1,660 Future 2 $52,832.44 100% $52,832.44 1,660 Subtotal Labor $261 ,668.98 6,640 Labor $78.82 p_t hour Vehicles $30.00 $108.82 pr hour Per hour Pretreatment Field Crew per hour PLUS + Sampler Equip/tools /samp e /samile $12.49 $1.44 $13.93 per sample ser sample pr sample Per Sample Pretreatment Efulpment PLUS + City_§ervices/admin. City Utility Tax 10% 14% on subtotal on subtotal Per hour Pretreatment Fleld Crew $136.46 Per sample Equl • ment $17.99 7/26/01 TABLE 6-6 Sampling and Testing Fees Proposed for 2002 7.60.105. D (1) Pretreatment Existing 1 increase Proposed MIU Base fee $35.70 1 68.1% f $60.00 (Owner @ 75%) $26.78 j 68.1% 1 $45.00 { Sampling Period first day $195.80 13.7% $222.68 subsequent days $74.14 16.3% ! $86.22 1 7.60.105. D (2) Laboratory Testing Fees BOD $30.92 9.4% $33.82 TSS $30.92 9.4% $33.82 pH $15.45 1 9.4% $16.91 Alkalinity $15.45 I 9.4% ! $16.91 Ammonia $15.45 ! 9.4% 1 $16.91 Chlorine Residual $15.45 I 9.4% ! $16.91 Dissolved Oxygen (Azide) $15.45 ! 9.4% $16.91 Dissolved Oxygen (Membrane) $15.45 I 9.4% $16.91 Fecal Coliforms $46.37 1 9.4% $50.73 RXG $61.82 ! 9.4% i $67.64 MPN $309.11 9.4% j $338.20 Nitrate 1 $30.92 j 9.4% 1 $33.82 Nitrite $30.92 9.4% ! $33.82 Organic/Volitile Acids $15.45 9.4% ! $16.91 Total Volitile Solids 1 $30.92 , 9.4% ! $33.82 BNA $357.00 j market cost BTEX $905.52 '; -78.1% I $198.48 Metals (AA) ! $2,263.79 ' -89.0% $248.10 Metals (graphite furnance) Pesticides/PCB's $1,131.89 I -51.8% $545.82 TPH $102.00 : market cost Volitile Organics $905 52 -78.1% $198.48 I I 7.60.105. D (3) Flat Rate Fees Discharge Authorization 1 $255.00 56.9% ! $400.00 Compliance Inspection 1 $51.00 167.6% $136.46 Dye Testing $51.00 167.6% $136.46 Smoke Testing $51 .00 -2.0% $50.00 TVing (per hour) $285.60 -9.0% $260.00 TVing new construction (per If) new $1 .60 1 0/9/01 SECTION 7 NON -OWNER (COUNTY) DOMESTIC RETAIL CUSTOMERS Introduction; This section contains the cost of service analysis performed for the non -owner (county) domestic retail customers located outside City boundaries. Section 8 contains the cost of service analysis performed for the non -owner retail strong waste and all septage customers. Reference is made throughout this report to City retail and County retail customers. In fact, the County has no customers connected t o this system. The customers to whom the report is referring are retail customers of the City's wastewater system who live outside of the City limits (in the county). Due to the recent South 72nd. Avenue annexation, approximately 90% of those who were County retail customers are now City retail customers. This section recognizes this shift and allocates accordingly. As explained in Section 2 of this report, the rates for non -owner retail customers are calculated utilizing a UTILITY RATE BASIS. From Section 2, remember that the three elements of the utility basis of accounting are: • Operating Expense: Operating expenses are the costs o f operating the sewerage system on a day-to-day basis, and include costs of operating and maintaining the wastewater treatment plant and collection and disposal facilities of the sewerage system, administrative costs, and system replacement costs. • Depreciation Expense• "Depreciation is the loss in value o f facilities, not restored by current maintenance, that occurs due to wear and tear, decay, inadequacy, and obsolescence. The annual depreciation expense component of revenue requirements provides for the recovery of the utility's capital investment over the anticipated useful life of the depreciable assets." AWWA Manual M1 Water Rates 2001 COS Section 7 Page 1 October 10, 2001 • Rate of Return Allowance (Return on investment): "The return component is intended to pay the annual interest cost of debt capital and provide a fair rate of return for the total equity capital employed to finance physical facilities used to provide utility service." AWWA Manual M1 Water Rates. Purposes of the Cost of Service Study - Retails Non -owner Customers; The purposes of this cost of service analysis for non -owner customers of the Retail System are to: • Allocate operating, depreciation, and return on investment costs of providing service to non -owner customers. • Determine whether or not non -owner retail customers receiving service from the City's sewerage system are paying fair and appropriate shares of costs of providing service. • Use the results of the retail cost of service analysis to establish equitable rates and charges for non -owner customers. Cost of Service Procedure: The cost of service procedure that will result in the appropriate allocations requires that we formulate the following information about expenses to the system_ Staff calculated these values for each year during the study period. However, 2002 was utilized as the TEST YEAR, therefore, most of the tables show data only for 2002. 1) Operation Expenses A. Treatment expenses and applicable allocation, B. Collection expenses and applicable allocation. 2) Depreciation expense A. Treatment Facility expenses and applicable allocation. B. Collection System expenses and applicable allocation. 2001 COS Section 7 Page 2 October 10, 2001 3) Return on Investment (ROI) A. Treatment Facility Rate Base and applicable ROR. B. Collection System Rate Base and applicable ROR. Organization_ of Cost of Service Tables - Non -owner Retail Customers: This section analyzes appropriate rates for "normal" domestic flow, as defined by the 1976 Agreement, for non -owner (county) retail customers who are connected to our collection system. Section 8 shall then calculate appropriate charges for Biochemical Oxygen Demand (BOD) and Suspended Solids (SS) that shall be utilized while calculating rates for non -owner strong waste and all septage customers. On all of the tables in this section, "City" shall designate all sewer •u- designated "County". 1- 1.1-• £ 1- - - •u- OPERATING EXPENSE •• •- 1) Treatment Facility Operating Expense (SU 232)• As explained in Section 2, the 1976 Agreement stipulates, "Monthly sewage disposal charges shall be determined from the flow measured...". Therefore, it is not contractually appropriate to allocate BOD or SS charges on "normal" domestic flow. These components only become significant when their concentration exceeds 300 ppm. At that concentration, they are considered strong waste. Consequently, Operation expenses for "normal" concentrations are allocated on the percentage of flow received. Approximately 90% of the county retail sewer customers receive their domestic water from the Nob Hill Water Association (Nob Hill). The Association reads these meters bi-monthly. Each individual customer's usage is reported by Nob Hill to the City's Customer Services Department where it is hand entered into the City's computer system for sewer billings. All sewer accounts that receive Nob Hill water are automatically set up by City staff for a summer irrigation discount; (i.e. The winter flow rate (November through February) o f 2001 COS Section 7 Page 3 October 10, 2001 each individual account is used throughout the entire year f o r calculating bimonthly sewer billing). Customers who receive their domestic water from a source other than Nob Hill water and have an alternate source of irrigation water must request a summer irrigation discount. While examining the percentage of flow received from the county customers, we must also allocate the Infiltration/Inflow (WWI) that is received and treated at the Facility. Since all of the flow fro m Terrace Heights and the majority from Union Gap are metered just prior to entering the City's system, for this report, ail the non -billed (1/I) flow is allocated against retail County and City customers. In the 1990 City report, the I/1 was allocated equally to the percentage of billed flow from the City and outside City (County) retail customers. The 1991 County report took exception to this allocation percentage andasserted that Water Pollution Control Federation (WPCF) guidelines 611N• v• should be utilized for this allocation. The 1991 County report stated that WPCF guidelines stated that the allocation of 2/3 of the I/1 should be based on service area and 1/3 should be based upon billed flow. Staff consequently reviewed the aforementioned WPCF Publication Financing and Charges for Wastewater Systems. In Appendix D of this publication it states, "Customer ciass I/1 units of service are not directly related to wastewater volumes discharged by the customers. That is, the volume of contributed wastewater flow from an individual customer is not a measure of that customer's potential responsibility for 1/1. A more accurate theoretical measure of I/I responsibility might be one that covers the customers' property and storm water runoff potential, as well as sewer lateral leakage. Such parameters are not readily ascertainable, however, as a basis of billing customers for I/1 costs. Based on these considerations, responsibility for I/1 may reasonably be allocated to customer classes on the basis of some measure that reflects both the number and relative size of customer served. In this example, 2/3 of the total I/I shown is allocated t o customer classes in proportion to the number of individual customers. The remaining 1/3 is allocated to classes based on the contributed wastewater volume of each class." 2001 COS Section 7 Page 4 October 10, 2001 Due to the different approaches presented and the fact that no one method is held to be more accurate, the 1996 COS calculated I/1 allocation using all three different methods suggested above. (See Table 7-12 I/1 Allocation 1996 COS). Method 1) Allocates the entire I/I flow back against the retail flow o f the City and County based upon the percentage of their billed flow. Method 2) Utilizes the formula suggested by the 1991 County report: 2/3 of the I/1 is allocated based upon service area of the user group and 1/3 is allocated based upon billable flow. Method 3) Utilizes the formula used as an example in the WPCF Publication Financing and Charges for Wastewater Systems, that being that 2/3 of the I/I be allocated based upon number of customer accounts of the user group and 1/3 be allocated based upon billable flow. For the 1996 COS report, staff found that method 1 was the median value of the three and less than average of the three. Therefore, f o r the 2001 COS staff utilized the same methodology. For the Test Year 2001 0.73% of the Operating Costs of Treatment Facility SU 232 are allocated to County retail. This same calculation was performed for the other years of the planning period. The annual percentage of total plant flow allocated to this user group calculated by use of Method 1 is shown on Table 7-12. The results were then carried to Table 7-5 Operating Expenses SU 232 County to calculate the expenses for each year of the planning period. For 2002, the calculation yields: Operation Expenses = 0.73% of $3,504,025 = $25,579 2) Collection System Operating Expense (SU 211)• For this report, we have examined three methods of allocating this cost. Those methods are: 1) Percent Retail Flow, 2) Length of Pipe, o r 3) Number of Accounts. Method 1) As shown on TABLE 5-1, the report projects that during 2002 0.80% of retail billed flow will be from County retail accounts. 2001 COS Section 7 Page 5 October 10, 2001 Method 2) Information Systems staff was able to develop from o u r G.I.S. inventory the length of sewer pipes within the total system and within the County area that remained after the South 72nd. Avenue annexation. It was determined that the total system presently contains 298.2 miles of pipeline, 5.4 miles of this is remain within the County. This equals 1.80% of the present total and will most likely increase by 2002. Method 3) As shown on TABLE 5-9, the report projects that during 2002 0.82% of retail accounts will be County. For this report, staff chose to use the results of method 1, 0.80%. These results were then carried to Table 7-6 Operating Expenses SU 211 County to calculate the expense for each year of the planning period. For 2002, the calculatior'I yield:: Collection Expenses = 0.80% of $ 2,141,038 = $ 17,128. 3) Storm Sewer System Operating Fxperts.e (SU 213)• For this report, operating and capital expenses of the storm sewer system (SU 213) that City crews presently maintain were allocated entirely to inside City customers. 4) Rudkin Road Lift Station Operating Expense (SU 215)• Union Gap, inside city, and outside City customers utilize the Rudkin Road pumping station (S 121 ); however, it iS believed that IASS than 1% of the total flow through this station is from outside City retail customers. Therefore, at this time, staff chose to exclude these expenses from this user group. DEPRECIATION EXPENSE Introduction: Under a Utility Basis of accounting, customers pay depreciation expense associated with capital assets that are used to provide ccrvitV'V. In rVnVn,V-cVnt, thcVVcv naMy toV rcvnl.a..rv'av thev cvvctA.m cr rvt 2001 COS Section 7 Page 6 October 10, 2001 time as that is required (at the end of the depreciation period). This provides continuous service to these customers. The depreciation expense is applied to the entire original cost of the system without any deductions for grants or customer participation. Under a Utility Basis, the owner (City) is compensated for the initial construction local share of expenses of the treatment facility and interceptors through Capital Cost Recovery Fees (CCRC) and for initial construction local share of expenses of sewer collection system through Sewer Hookup Fees. 1) Treatment Facility: Staff performed an extensive review and update of the depreciation records of the Treatment Facility. The expense of the recently completed construction project and the construction in progress was also included. The Facility annual depreciation costs are shown on Table 7-7. These expenses are allocated based upon the percent of total treatment facility flow that has been established as 0.73% for the Test Year 2002. This value will vary in the future to reflect plant improvements and expansions and as the percent of plant flow from this user group varies. The annual Plant depreciation allocated to County during 2002 is $22,685. 2) Collection System: For the 1994 and the 1996 report, staff researched over 1,000 individual collection system projects which have been installed since 1892. Projects were reviewed for project cost and physical location. Staff was, able to obtain a much more accurate accounting of the value of collection system dedicated to county customers. This total inventory value will increase as additional assets utilized by this user group are incorporated into the City's inventory, however the expense per account may decrease as additional customers utilize the same assets. For this report, staff has projected that 90% of the value o f inventory prior to annexation shall come into the City. The remaining County customers were allocated the remaining 10% of the depreciation. Staff also projected the annual depreciation to remain flat through the planning period. As shown on Table 7-8, the annual depreciation expense of County collection system and dedicated capacity in the transmission lines for the year 2002 is $26,954. 2001 COS Section 7 Page 7 October 10, 2001 RETURN ON INVESTMENT The WPCF Manual says the following about Rate Base and Rate o f Return: " The rate base is often defined as the total original cost dollar value of facilities used and useful in providing utility service. It usually includes the depreciated plant value less contributed capita! including federal and state grants, plus cash working capital and, in certain jurisdictions, construction work in progress...." " The rate of return is established at a level that will permit recognition of business and financial risk. The rate of return is the rate that the utility is allowed an opportunity to earn, over and above operating expenses, depreciation expense, and taxes. The return component is intended to pay the annual interest cost of debt capital and provide a fair rate of return for the total equity capital emnlnyed. That money will then finance physical facilities used to provide wastewater services..... Return on plant value is seldom used under public ownership as a profit, but is used as a source of funds f o r reinvestment in additions, replacements, and improvements." The rate of return, expressed as a percentage, is applied to a utility's rate base to determine the amount of "return on investment" to be included in the utility's total revenue requirement. Determination of Rate Base: Tables 7-9 Rate Base Treatment Facility and 7-1n Rate Race Collection Facility show the original cost of the Yakima Domestic Wastewater Treatment and Collection facilities, less Federal and State grant funds, less accumulated depreciation, less contributed capital, plus construction work in progress, plus working capital. Determination of Rate of Return: Staff referred to AWWA Manual M35 Revenue Requirements. There it states "Courts and commissions have determined that for a utility to compete successfully in the capital markets, it should be allowed a return based on its "cost of capital." The cost of capital represents the weighted cost of the various classes of capital used by the utility." 2001 COS Section 7 Page 8 October 10, 2001 On Table 7-11, staff listed all Outstanding Principal and the interest charges on each. The monetary difference between the Rate Base and the Outstanding Principal is Owner Equity. Staff consulted representatives of the Washington State Utilities Commission, The National Regulatory Research Institute, and Moody's, Inc. to determine the current appropriate rate of return on owner equity. All agencies contacted indicated that a return within the range of 12-14% was currently acceptable. Staff chose to use a 12% return on Owner Equity. As we are a tax-exempt entity, we assessed 66% of that value (8.0%) As shown on Table 7-11, due to the large amount of low interest loans the division has been able to secure, the average interest rate on the total rate base is 5.97%. Therefore, for this report the Rate of Return = 5.97%. Determination of Return on Investment: Applying a 5.97% rate o f return to the non -owner's allocation of these rate bases results in the following return on investment due from non -owner (County) retail customers. For the Test Year 2002, as shown on Table 7-9 Treatment Facility Return on Investment equals $8,645. For the Test Year 2002, as shown on Table 7-10 Collection System Return on Investment equals $27,244. Summary of Expenses: On Table 7-4 is listed the total revenue requirement for non -owner (County) retail customers for 2002. 1) Operation Expenses A. Treatment expenses = $ 25,579 B. Collection expenses = $ 17,128 2) Depreciation expense A. Treatment Facility expenses = $ 20,300 B. Collection System expenses = $ 26,954 2001 COS Section 7 Page 9 October 10, 2001 3) Return on Investment A. Treatment Facility = $ 8,645 B. Collection System = $ 27_244 Subtotal = $125.85Q 4) Utility Tax (presently 14% of gross) = $ 17,619 TOTAL 2002 REVENUE REQUIREMENT $143,469 Similar calculations were performed for each year of the planning period using projected flow and expense. The summary of these calculations is shown on Table 7-4. RATE STUDY: In the 1996 COS, it was recommended and adopted by Council that the City revise its sewer service and other charges to outside customers to include: • Adoption of a Ready -to -Serve (R -t -S) and Volume Charge f o r outside City customers which recovers the sewer service charge revenue requirement defined for outside customers for operations and maintenance, depreciation, and return on investment. • Discontinuance of the surcharge factor concept, Commencing with the adoption of the 1994 COS, wastewater service charges fnr ni itciric ri ictnmcrc aro hacori nn rnctc of nrnvirlinn service The use of the surcharge factor was deemed not an appropriate method to identify cost differences between inside and outside City customers and was not appropriate under the utility basis method used to establish rates. A separate, independent schedule o f sewer service charges consisting of Ready -to -Serve and Volume charges was implemented for outside City customers. As in the 1994 and 1996 COS, the proposed charges are based on the following elements for each year of the planning period: 1) 2) V 2001 COS Section 7 Page 10 October 10, 2001 Annual Revenue Requirements Number of Meter Equivalent Accounts Tr,+al OiII r! CIno.P 1 VI.GAI V111V4 1 IVf• 1) Annual Revenue Requirements for County retail customers are shown on TABLE 7-4. 2) Number of Equivalent Accounts is shown on TABLE 5-9. 3) Total billed flow is shown on TABLE 5-1. Establishment of New Rates: Adjustment of Existing Rates: Table 7-3 EXISTING RATES demonstrates the anticipated revenue for each year of the planning period if rates remain at their current level. Shown on the top of Table 7-1 is a comparison of revenue values determined on 7-3 with revenue requirements from Table 7-4. The percentage shortfall of revenue produced by existing rates for each year of the planning period is demonstrated. The anticipate revenue shortfalls are: 2001 -12.73% 2002 -11.96% 2003 -13.76% 2004 -14.92% 2005 -13.66% 2006 -13.07% Following is an OPTION that adjusts existing rates to obtain required revenue. 2001 COS Section 7 Page 11 October 10, 2001 OPTION: The Ready -to -Serve charge and Volume Charge were each adjusted in One Phase of 14%. Existing rates of Ready -to -Serve Volume = Were increased 14.0°A, to: = $ 16.01 $ 2.86 Phase One Ready -to -Serve = $ 18.25 Proposed Rates = Volume = $ 3.26 Table 7-2 calculates the revenue anticipated from this Option for each year of the planning period. TableTable7 1 compares revenue determinari nn 7-2 with allocated / - I compares a7 s vvv� �uv values yddv.......v.. .... � with ..... . _...._� expenses from Table 7-4. Conclusions: For non -owner retail customers: 1) On Table 7-1, it is shown that for the years 2002 through 2006, revenue from existing rates would be approximately $20,000 (14%) less than their allocation of expenses. 2) The rate adjustment Option shown will generate approximately the revenue required through 2006. 3) The Depreciation and Return on Investment elements o f collection system expenses are related to capital investment to the system that benefits this user group. During the past two years, several such major projects were financed by the City. These projects include the 7th Street interceptor and the Summitview Avenue work. The added depreciation and ROI expense from these projects accounts for the majority of the rate adjustment. 4) rata i l The relationship between rates for this user group and City is riirartly ralatarl to the dost of rnllArtinn infractritrtiire 2001 COS Section 7 Page 12 October 10, 2001 per account. At such time that the existing pipelines for this user group are servicing additional accounts, the cost per account will decrease. Recommendations; 1) Implementation of the Recommended OPTION: A Rate Increase of 14% in One Phase • Implement Phase One. This increases rates from existing to those required in 2002: Existing: Ready -to -Serve = $ 16.01 per equivalent Volume = $ 2.86 per UOC Phase One: Ready -to -Serve = $ 18.25/equiv. Volume = $ 3.26/UOC 2001 COS Section 7 Page 13 October 10, 2001 Table 7=1 Non -owner (County) Wastewater Retail Customer Projected Revenue/Requirement Page 1 10/9/01 Projected Projected Revenue I % % Revenue Requirement Shortfaii Shonfaii increase CURRENT RATES Table 7-3 Table 7-4 Year Projected Revenue Requirement 2001 $1,252,256 $1,411,692 ($159,436) -12.73% 2002 $128,144 $143,469 ($15,325) -11.96% 2003 $132,265 $150,470 ($18,205) -13.76% 2004 $136,245 $156,569 ($20,324) -14.92% 2005 $140.466 $159.659 ($19.193) -13.66% 2006 $144,742 $163,655 ($18,913), -13.07% 2002-2006 ($91,960) OPTION A PROPOSED RATES One Time 14% Table 7-2A Table 12-4 Projected Revenue Requirement 2001 1 $1 ,252,256 $1,411,692 ($1 59,4361 -12.73% 2002 , $146,069 $143,469 $2,600 1.78% 14.00% 2003 $150,766 $150,470 $296 0.20% 2004 $155,303 $156,569 ($1.266) -0.82% 2005 $160,115 $159,659 $456 0.28% 2006 $164,988 $163,655 I $1,333 0.81% 1 2002-2006 I $3,419 effective increase 13.99% Page 1 10/9/01 Table 7-2 PROPOSED RATES Non -owner (County) Projected Annual Revenue 9/19/01 # Revenue Revenue TOTAL Equivalent Total Billed (Ready- (Volume) Revenue Accounts Flow (UOC) to -Serve) (see Table (see Table 5-9) 5-1) EXISTING RATE 10 OUC Ready -to -Serve Charge $16.01 per Meter Equivalent $44.61 Volume Charge $2.86 per Unit of Consumption (748 gallons) 2001 2,440 273,945 $468,773 $783,483 $1,252,256 actual PHASE ONE @ 14.00% increase 10 OUC Ready -to -Serve Charge $18.25 13.99% $50.85 Volume Charge $3.26 13.99% " Assumes 90% Annexation 2002 249 28,079 $54,531 $91,538 $146,069 % increase -89.80% -89.75% -88.37% -88.32% -88.34% 2003 260 28,781 $56,940 $93,826 $150,766 % increase 4.42% 2.50% 4.42% 2.50% 3.22% 2004 270 29,501 $59,130 $96,173 $155,303 % increase 3.85% 2.50% 3.85% 2.50% 3.01% 2005 281 30,238 $61,539 $98,576 $160,115 % increase 4.07% 2.50% 4.07% 2.50% 3.10% 2006 292 30,994 $63,948 $101,040 $164,988 % increase 3.91% 2.50% 3.91% 2.50% 3.04% 9/19/01 Table 7-3 EXISTING RATES Non -owner Projected Annual Revenue Existing Rates 9/19/01 1 1 1 1 0 t 1 1 t 1 4 Revenue Revenue TOTAL Equivalent Total Billed (Ready- (Volume) Revenue Accounts Flow (UOC) to -Serve) (see Table (see Table 5-9) 5-1) EXISTING RATES Ready -to -Serve Charge $16.01 per Meter Equivalent Volume Charge $2.86 per Unit of Consumption (748 gallons) 2001 2,440 273,945 $468,773 $783,483 $1,252,256 "Assumes 90% Annexation 2002 249 28,079 $47,838 $80,306 $128,144 % increase -89.80% -89.75% -89.80% -89.75% -89.77% 2003 260 28,781 $49,951 $82,314 $132,265 % increase 4.42% 2.50% 4.42% 2.50% 3.22% 2004 270 29,501 $51,872 $84,373 $136,245 % increase 3.85% 2.50% 3.85% 2.50% 3.01% 2005 281 30,238 $53,986 $86,481 $140,466 % increase 4.07% 2.50% 4.07% 2.50% 3.10% 2006 292 30,994 $56,099 $88,643 $144,742 % increase 3.91% 2.50% 3.91% 2.50% 3.04% 9/19/01 1 1 1 1 0 t 1 1 t 1 OMB III i I MI 'B NB MI MI MIMI NM M OM e MI N '® N Table 7-4 Non -owner (County) Retail Customers Annual Revenue Requirement Source Reference 2001 2002 2003 1 2004 2005 2006 Table ** Billable Flow UOC 5-1 273,945 28,079 28,781 29,501 30,238 30,994 Flow % Increase 5-1 2.50% -89.75% 2.50% 2.50% 2.50% 2.50% % Total plant flow 7-12 5-8A 7.14% 2,380 0.73% 247 0.74% 257 0.76% 267 0.77% 277 0.79% 288 # Customer Accounts # Equivalent Accounts 5-9 2,440 249 260 270 281 292 Operation Expense Treatment (SU 232) 7-5 $231 ,962 $25,579 $26,527 $28,046 $29,251 $24,353 $30,897 $25,599 Collection (SU 211) 7-6 $140,782 $17,128 $19,936 $23,154 subtotal $372,744 $42,707 $46,463 $51 ,200 $53,604 $56,496 Depreciation Expense Treatment 7-7 $145,086 $20,300 $22,685 $23,298 $23,605 $24,218 $26,954 Collection 7-8 $269,535 $26,954 $26,954 $26,954 $26,954 subtotal $414,621 $47,254 $49,639 $50,252 $50,559 $51,172 Return on Investment Treatment 7-9 $74,597 $8,645_ $27,244 $8,645 $27,244 $8,645 $271244 $8,645 $27,244 $8,645 $27,244 Collection 7-10 $376,364 subtotal $450,961 $35,889 $35,889 $35,889 $35,889 $35,889 Subtotal $1,238,326 $125,850_ $17,619 $131,991 $18,479 $137,341 $19,228 $140,052 $19,607 $143557_ $20,098 Utility Tax @ 14% of Gross $173,366 Total Expense Allocation $1,411,692 $143,469 $150,470 $156,569 $159,659 $163,655 increase -89.84% 4.88% 4.05% 1.97% 2.50% •* Anticipates 90% annexation _ _ 1 0/9/01 Table 7-5 TREATMENT FACILITY (SU 232) Operating Expenses Non -Owner Allocation Account Description Final 1998 Final 1999 Final 2000 Estimate 2001 Estimate 2002 Budget 2003 Estimate 2004 Estimate , 2005 Estimate 2006 No. Budget Test Year TREATMENT FACILITY SERVICE UNIT 232 OPERATIONS EXPENSES (see Table 4-6) 3,031,446 3,276,811 3,000,583 3,248,766 3,504,025 3,584,786 3,690,198 3,798,885 3,910,956 subtotal Operations 3,031,446 3,276,811 3,000,583 3,248,766 3,504025 3,584,786 3,690,198 3,798,885 3,910,956 2001 7.14% $231,962 Assumes 90% annexation 2002 0.73% $25,579 Non -owner (County) Retail Allocation 2003 0.74% $26,527 2004 0.76% $28,046 Flow percentages from Table 7-12 (% Total Plant Flow) _ 2005 0.77% $29,251 2006 0.79% $30,897 10/9/01 al 11111 11111 11111 NS MEI M ta= Mt 1=1 =11 MO NM INS w - — I - - i■11 MEI — A - 's. wt NO IMO a reed m Os Table 7-6 COLLECTIONS (Service Unit 211) Expenses Non -owner (County) Allocation Account Description Final 1998 Final 1999 Final 2000 Budget 2001 Estimate 2002 Estimate 2003 Estimate 20.04 Estimate ‘ 2005 Estimate 2006 No. _ Estimate Test COLLECTIONS SERVICE UNIT 211 Year OPERATION EXPENSES 2,942,433 (see Table 4-3) 1,659,362 1,595,053 1,729,485 1,802,591 2,141,038 2,461,265 2,789,657 2,865,018 subtotal Operations 1,659,362 1,595,053 1,729,485 1,802,591 2,141,038 2,461,265 2,789,657 2,865,018 2,942,433 2001 7.81% $140,782 Assumes 90% annexation 2002 - 0.80% $17,128 Non -owner (County) Retail Allocation 2003 0.81% $19936 2004 0.83% $23,154 Collection Percentage from Table 7-12 % Retail Flow) _ 2005 0.85% $24,353 _ __ 2006 0.87% $25,599 10/9/01 Table 7-7 DEPRECIATION Allocation of TREATMENT FACILITY for Utility Basis Method Paan iof2 Acct. Date Est. Historical Annual Percen Allocation Rata Baas Allocation No. Description Acquired Life Cost Existing I Depreciation City I County City ( County Plant 20tH (1) (2) (1) Sanitary Sow Traatmant Facility 17113 Land and Land Rights $11,923 $0 99.26% 0.74% 50 50 17383 Structur & Improv 1959 40 521,147 50 99.26% 0.74% 30 50 17383 Structur & Improv 1966 40 5221,950 55,549 99.26% 0.74% 55,506 541 17383 Structur s Lmvmv 1970 40 52,617 565 99.26% 0.74% 565 50 17383 Structur 8 Improv (Pease) 1989 1986 40 20 5422,642 $8,348 310,566 $417 99.26% 99.26% 0.74% 0.74% 510,488 $414 578 53 17383 Electrician's Office 17383 Storage Building 1991 20 57,410 5371 99.26% 0.74% 5368 $3 17383 BuilcingRemodel 1992 20 563,549 53,177 99.26% 0.74% 53,154 524 17383 Structur & improv (Pease) 1989 20 5877,753 543,888 99.26% 0.74% $43.563 5325 17383 Lagoon Cleanout 1989 10 5512.319 50 99.26% 0.74% 50 50 17383 Struct & Improv (Mullen) 1981 40 $8,345,191 5226.512 99.26% 0.74% $224,836 51,676 17383 Struct & im"ov 'Mule".' 1981 1981 20 15 54;560,072 5352.140 SO 50 99.26% 99.26% 0.74% 0.74% 50 $0 50 30 17383 Struct & Improv (Mullen) 17383 Struct & Improv (Mullen) 1981 15 5633,694 50 99.26% 0.74% 30 SO 17383 Struct & Improv (Mullen) 1981 1 5 5499,418 50 99.26% 0.74% SO 50 17383 Struct & Improv (Mullen) 1981 15 5328,308 50 99.26% 0.74% 50 50 17383 Struct & Improv (Mullen) 1981 1 5 5202.718 50 99.26% 0.74% 50 50 17383 Struct & Improv (Mullen) 1981 15 $79.373 50 99.26% 0.74% 50 50 17383 Struct & Improv (Copenhagen) 1985 40 5249,477 $6,549 99.26% 0.74% 56,500 548 17383 Struct & improv (Copenhagen) 1985 20 5295,775 $20,704 99.26% 0.74% 520,551 5153 17383 Struct & Improv (Copenhagen) 1985 1 5 5192.792 50 99.26% 0.74% 50 $0 17383 Struct & improv (PKS) 1989 40 56,773,968 $177,817 99.26% 0.74% 5176,501 51,316 17383 Struct & Improv (PKS) 1989 20 51,849,685 5129,478 99.26% 0.74% 5128.520 3958 17383 Struct & Improv (PKS) 1989 15 51.905,181 50 99.26% 0 74% 50 $0 17383 Structur & Improv (Pease) 1989 15 51,237,333 $82,530 99.26% 0.74% $81,919 5611 17383 Truck Scale wo 1093 Proj. 1612 1995 20 5148,800 $7,440 99.26% 0.74% $7,385 555 17383 Biosolids Storage wo 1062 proj. 1556 1995 20 5614,055 530,703 99.26% 0.74% 530.476 5227 17383 Lagoon Cleanout wo 1093 Proj. 1612 1995 10 5779,309 577.931 99.26% 0.74% 577,354 5577 17383 Biosolids Landscaping wo1096 proj1636 1995 10 594,756 59,476 99.26% 0.74% 59,406 570 17383 Trickling Filter Rehab wo1113 proj1673 1995 10 $75.721 57,572 99.26% 0.74% $7.516 556 17383 Compost Turner wo 1062 proj. 1556 1995 10 569,817 56,982 99.26% 0.74% 56,930 552 17383 Struct & improv (Humphrey) 1995 40 54.366.722 5291.260 99.26% 0.74% 5289,105 52,155 17383 Struct & Improv (Humphrey) 1995 20 52,004.444 5100,222 99.26% 0.74% 599,481 5742 17383 Struct & Improv (Humphrey) 1995 15 $6,788,679 $169,717 99.26% 0.74% $168,461 51,256 17383 Equipment Prepurchase prof 1566 1997 20 5260,631 513,032 99.26% 0.74% 512,935 596 17383 Struct & Improv (IMCO) proj 1638 1999 15 52,781,878 $188,362 99.26% 0.74% 5186,968 51,394 17383 Struct & Improv (IMCO) proj 1638 1999 20 52.447,607 5124,409 99.26% 0.74% 5123,488 5921 17383 Struct & Improv (IMCO) proj 1638 1999 40 $2,141,773 $54.523 99.26% 0.74% 554,119 $403 17383 Class A Biosolids Proj 1752 1999 1 0 512,685 51,269 99.26% 0.74% 51,259 $9 17�. ."iu."i o_h_b proj 1 mar �u�!i,r r.n,.nv, � iw� 1009 Jyy 10 v $188.309 518,831 99.26% 0.74% 518,692 $1:19 subtotal Treatment Facility 552,429,969 $1,809,351 51,795,962 513,389 18273 Sewage Disposal Equip 39-45 40 536,080 50 99.26% 0.74% 50 50 18273 Sewage Disposal Equip 1991 40 $61,487 31,537 99.26% 0.74% 51.526 511 18273 Sewage Disposal Equip 1967 25 51,021,896 50 99.26% 0.74% $0 50 18273 Sewage Disposal Equip 1987 10 36,527 S0 99.26% 0.74% 50 $0 18273 Blower Rehab wo#1120 proj#1696 1995 10 $85,019 $8,502 99.26% 0.74% 58.439 563 18273 Bird Centrfge Rehab wo#1126 prj#1666 1995 10 $59,001 55,900 99.26% 0.74% 35,856 344 18273 Sludge Grinders wo#1142 proj#1713 1996 10 5135,965 513,597 99.26% 0.74% 513,496 5101 18273 Hot wtr pipng/Elect wo#1142 proj#1713 1996 20 $342.503 517,125 99.26% 0.74% 516,998 5127 18273 HVAC equip wo#1142 proj#1713 1996 1 5 $60,410 54,027 99.26% 0 74% 33,998 530 18273 Service Air Comp wo#1138, proj#1716 1997 10 54,147 5415 99.26% 0.74% $412 53 18273 SCADA system improvements Proj 1637 1997 5 $330,326 $66,065 99.26% 0.74% 565,576 5489 18273 Air Compressor 1998 1 0 $4,963 5496 99.26% 0.74% 5493 $4 subtotal Treatment Facility 52.148.324 5117,664 $116,794 3871 18287 Tools, Shop & Garage Equipment 1983 1 0 $4.442 50 99.26% 0.74% 50 50 18287 Tools, Shop & Garage Equipment 1985 10 57,798 $0 99.26% 0 74% 50 50 18287 Tools, Shop & Garage Equipment 1987 1 0 $3,071 $0 99.26% 0.74% 50 $0 18287 Tools, Shop & Garage Equipment 1987 1 0 $2,024 $0 99.26% 0.74% $0 $0 18287 Tools, Shop & Garage Equipment 1989 10 $1,724 50 99.26% 0.74% 50 50 18287 Tools, Shop & Garage Equipment 1990 1 0 57,544 $0 99.26% 0.74% 50 50 18287 Tools, Shop & Garage Equipment 1991 1 0 51,629 5163 99.26% 0.74% 5162 $1 subtotal Shop Equipment 528,232 $163 3162 31 9/19/01 Table 7-7 DEPRECIATION Allocation of TREATMENT FACILITY for Utility Basis Method Page 2 of 2 Acct. Date Est. Historical Annual Percent Allocation Rate Base Allocation No. Description Acquired Life Cost Existing Depreciation City County City County Plant 2003 (1) (2) (1) General Plant 18637 Office Furniture & Equipment 1982 10 $1,754 $0 99.26% 0.74% $O SO 18637 Office Furniture & Equipment 1990 10 $6,518 $0 99.26% 0.74% $0 SO 18637 Office Furniture & Equipment 1990 10 $5,380 SO 99.26% 0.74% 50 $0 18637 Office Furniture & Equipment 1991 10 $3,266 $327 99.26% 0.74% $324 52 18637 Office Fumiture & Equipment 1989 1 0 54,938 50 99.26% 0.74% 50 $0 18637 Office Furniture & Equipment 1993 10 52,778 5278 99.26% 0.74% 5276 52 18637 Office Furniture & Equipment 1993 10 54,224 5422 99.26% 0.74% 5419 53 18637 Computer 1995 10 54,580 5458 99.26% 0.74% 5455 53 18637 Office Fumiture & Equipment 1995 10 51,785 $178 99.26% 0.74% 5177 51 18637 Computer 1997 5 54,822 5964 99.26% 0.74% 5957 $7 18637 Computer 1997 5 $4,531 $906 99.26% 0.74% 5899 57 subtotal Equipment $44,575 53,534 53,508 $26 18187 Laboratory Equipment 1986 10 53,302 50 99.26% 0.74% $0 50 18187 Laboratory Equipment 1991 10 516,239 $1,624 99.26% 0.74% 51,612 $12 18187 Laboratory Equipment 10 $8,574 50 99.26% 0.74% 50 50 18187 Sampler 1995 10 57,406 $741 99.26% 0.74% $735 55 18187 Graphite Furnance 1996 5 525,108 $5,022 99.26% 0.74% 54,985 537 181871Autoclave 1997 10 56,171 $617 99.26% 0.74% $613 55 subtotal Lab Equipment 566,801 58,003 57,944 559 18567 Power Operated Equipment 1985 5 57,639 50 99.26% 0.74% $0 $0 subtotal Power Equipment 57,639 $0 $0 50 18727 Communications Equipment 1989 1 0 $4,386 $0 99.26% 0.74% 50 $0 18727 Communications Equipment 1990 10 54,844 SO 99.26% 0.74% $0 $0 18727 Communications Equipment 1991 1 0 $8,355 $836 99.26% 0.74% $829 $6 18727 Communications Equipment 1993 10 $19,646 $1,965 99.26% 0.74% 51,950 515 subtotal Communications Equipment 537,232 $2,800 52,779 521 18887 Misc. Equip 1985 1 0 $2,985 50 99.26% 0.74% 50 50 18887 Misc. Equip 1990 1 0 $9,702 50 99.26% 0.74% $0 $0 18887 Misc. Equip 1993 1 0 53,976 $398 99.26% 0.74% $395 53 18887 Yamaha 4 wheeler 1995 5 53,881 50 99.26% 0.74% 50 50 18887 Solid waste cutter 1995 5 54,826 $0 99.26% 0.74% $0 $0 18887 Enviro track IV Info 1996 5 $5,223 51,045 99.26% 0 74% 51,037 58 1888715334ZTAST Copier 1996 5 $8.806 $1,761 99.26% 0.74% $1,748 513 18887 Computer 1996 5 $3,884 $777 99.26% 0.74% $771 56 18887 3710 Sampler 1996 5 $4,197 $839 99.26% 0.74% $833 $6 18887 Dishwasher 1999 5 58,350 $1,670 99.26% 0.74% 51.658 512 18887 Sampler 1999 5 $5,197 $1,039 99.26% 0.74% 51.032 $8 188871Sampler 1999 5 $4,882 5976 99.26% 0.74% 5969 $7 subtotal General Plant $65,909 $8,505 $8,442 563 1999-2003 Plant Improvements SCADA Y2K Upgrade proj 1825 2000 5 5160,000 532,000 99.26% 0.74% $31,763 $237 Facility Plan Update wo1099 proj1640 2000 5 5250,000 $50,000 99.26% 0.74% $49,630 $370 Odor Litigation 1999 5 $3,300,000 $660,000 99.26% 0.74% $655,116 $4,884 Trickling Filter Mechanism (2001) 2001 20 $1,777,000 $88,850 99.26% 0.74% 588,193 $657 Biosolids Thickening (2002) 2002 15 51,445,000 596,333 99.26% 0.74% $95,620 $713 Biosolids Handling (2003) 2003 20 53,767,000 5188,350 99.26% 0.74% 5186,956 $1,394 subtotal Plant Improvements $10,699,000 51,115,533 $1,107,278 $8,255 TOTAL $65,527,681 1 $3,065,554 53,042,869 522,685 (1) For this table, City represents all users except County retail customers City 53,042,869 (2) Allocation based upon estimated percentage of flow from user group. County 522,685 (see Table 7-12) County 0.74% County Depreciation Treatment Facility $22,685 9/19/01 Tabid 7-Y DEPRECIATION Aiirx®cion of COLLECTION SYSTEM to Utility Basle Method Page 9 of 2 Acct. Date Service Historical Annual Percerd Allocation Rate Base Allocation No. Description Acquired Lite Cost Existing Depreciation City (1) County City (1) County Sanitary Sewer Maintenance 17384 Structure (Don Young Propertyl 1993 40 *630,569 $15764 99% 0.73% 515,649 *115 17384 Structure (Don Young Property) 1993 10 *90,705 $9,071 99% 0.73% 59,004 $66 17384 Srnv,lure (Duro Vnune Prn_ne_nv_1 1993 20 5289.638 S14.482 99% 0.73% 514,376 $106_ subtotal Structures *1,010,912 539,317 $39,030 $287 Sanitary Sewer Collection 17714 Laterals 1962 50 57,530 *151 100% 0% *151 $0 17714 Laterals 1963 50 5459 59 100% 0% 59 $0 17714 Laterad 1964 50 524,594 $492 100% C% $492 $0 17714 Laterals 1965 50 $7,621 5152 100% 0% 5132 _ 50 17714 Laterals 1966 50 $41,098 $822 100% 0% *822 $0 17714 Laterals 1969 50 $139,999 $2,800 100% 0% 82,800 $0 17714 Laterals 1969 50 587,539 51,751 100% 0% 51,751 $0 17714 Laterals 1970 50 $81,053 *1.621 100% 0% 51,621 50 17714 Laterals 1968 50 *177,224 53,544 100% 0% $3,544 *0 17714 Laterals 1971 50 $172,952 53,459 100% 0% $3,459 $0 17714 Laterals 1971 50 50 5141,635 5315,790 52,833 $5,316 100% 100% ' 0% 0% ' 52,833 56.916 $0 50 17714 Laterals 17714 Laterals 1974 50 *52,227 *1,045 100% 0% 51,045 *0 17714 Laterals 1975 50 5112,851 52,257 100% 0% *2,257 50 17714 Laterals 1975 50 5116,576 *2,332 100% 0% $2.332 $0 17714 Laterals 1975 50 $19,073 5381 100% 0% $381 *0 17714 Laterals 1975 50 571,144 51,423 100% 0% 51.423 *0 17714 Laterals 1975 50 565,263 51,305 100% 0% $1,305 50 17714 Laterals 1975 50 5126,839 52,537 100% 0% *2,537 *0 17714 Laterals 1975 50 $44,137 $883 100% 0% 5883 50 17714 Laterals 1976 50 567,580 51,352 100% 0% *1,352 ' 50 17714 Laterals 1976 50 5166,726 $3,335 100% 0% 53,335 *0 177141Laterals 1977 50 558,204 51,164 100% 0% 51,164 *0 17714 Laterals 1977 50 5120,275 52,406 100% 0% 52,406 $0 17714 Laterals 1978 50 5201,054 54,021 100% 0% 54,021 50 17714 Laterals 1978 50 5209,792 54,196 100% 0% $4,196 *0 17714 Laterals 1978 50 5249.081 54,982 100% 0% *4,982 *0 17714 Laterals 1980 50 526,717 5534 50% 50% $267 $267 17714 Laterals 1981 50 51,513,456 530,269 50% 50% 515,135 515,135 17714 Laterals 1981 50 587,131 51,743 40% 60% 5697 *1,046 17714 Laterals 1981 50 5110,038 52,201 40% 60% $880 *1,320 17714 Laterals 1985 50 5338,556: 56,771 40% 60% 52,708 54,063 17714 Laterals 1987 50 5800,300 516,006 30% 70% 54,802 511,204 17714 Laterals 1988 50 5720,681 514,414 30% 70% 54,324 510,090 17714 Laterals 1989 50 5606,467 $12,129 20% 80% 52,426 59,703 17714 Laterals 1990 50 5236,380 54,728 20% 80% 5946 *3,782 17714 J.aterals 1993 40 5156.460 53,912 20% 80% $782 $3,129 17714 Laterals 1994 40 5377,140 59,429 20% 80% 51,886 57,543 17714 Laterals 1988 40 $52,293 51,307 20% 80% 5261 51,046 17714 Laterals 1992 40 5298,971 57,474 20% 80% *1,495 $5,979 17714 Yak Work release center wo#1139 1995 40 $72,508 51,813 0% 100% 50 $1,813 17714 Yak Work release center wo#1139 1995 40 5198,485 54,912 0% 100% $0 54,912 17714 Comerstone apts P41607 1995 40 530,057 5751 100% 0% $751 50 17714 Lincoln Estates P41621 1995 40 524,000 5600 0% 100% 50 5600 17714 Woodwinds West P41655 1995 40 5138,166 53,454 0% 100% 50 53,454 17714 Hochrein P41683 1995 40 541,950 51,049 0% $0 $1,049 17714 Yak Co. Fair P#1720 1995 40 59,030 5226 0% 100% 50 5226 17714 Chestnut Grove Townhomes P41724 1995 40 $55,905 51,398 0% 100% $0 $1,398 17714 Mt. Olive Lutheran 78th/Tieton P#1735 1995 40 545,743 $1,144 0% 100% 50 51,144 17714 Lat/MH-Ken Leingang 1995 40 $2,613 565 100% 0% 565 50 17714 Lat/MH•Oak Street 1996 40 511,792 5295 100% 0% 5295 50 17714 Lat/MH-27th Ave./Tahoma 1996 40 536,133 5903 100% 0% 5903 $0 17714 LaVMH-88th/Yakima Ave 1996 40 57,498 5187 0% 100% 50 5187 17714 LaVMH-74th Ave/LoganNiola 1996 40 52,125 553 0% 100% 50 553 17714 Lat/MH-S 22ndNiola 1996 40 54,064 5102 100% 0% 5102 50 17714 Lat/MH-S 72nd/Washington 1996 40 5377,092 59,427 0% 100% 50 $9,427 17714 Lat/MH-8th/Hathaway 1996 40 539,434 5986 100% 0% 5986 50 17714 Lat/MH-I.82 Target -Sub 1996 40 578,000 $1,950 100% 0% 51,950 50 17714 LaVMH-74th Ave/Tieton 1996 40 534,500 $863 0% 100% 50 $863 17714 LaVMH-34th/Nob Hill 1996 40 512,574 5314 100% 0% 5314 50 17714 8' sewer 8th Ave/J St. P41764 1997 40 549,030 51,226 100% 0% 51,226 50 17714 LID#1053-N 88th Av-Alpine Crt 1997 40 574,840 $1,871 0% 100% $0 $1,871 17714 LID#1054-S 70th Ave/Lindgren Dr. 1997 40 5115,714 52,893 0% 100% 50 $2,893 17714 Lat/MH-Wa Av d Longview Fiber Rd. 1997 40 517,748 5444 100% 0% $444 50 i i%i 4 Lav Mfl•Eflgltiw[iGU 1'tID-Itlii rll Village 199740 $13,543 5383 100% nw .. •.. $389 �---- $0 17714 Madison Av/81h Av P#1751 1997 40 $105,133 52,628 100% 0% 52,628 $0 17714 Laterals Jv498-123317 1998 40 5441,736 511,043 20% 80% 52,209 58,835 17714 Laterals Jv#99 1999 40 52,114,910 552,873 58% 42% 530,666 522,207 512,357,237 $272,341 50% 50% 5137,104 5135,237 9/19/01 Tabi* 74 DEPRECIATION Allocation of COLLECTION SYSTEM for Utility Basis Method Page 2 of 2 Acct. Date Service Historical Annual Percent Mocatbn Rate Base Allocation No. Description Acquired Life , Cost Existing ,Depreciation City (1) County City (1) County Sanitary Sewer Trunks/Interceptors 17714 -001 Trunks 1956 50 5154,398 *3,088 100% 0% 53,088 $0 17714 -001 Trunks 1957 50 51,168 523 100% 0% 523 50 17714 -001 Trunks 1958 50 $26,131 *523 100% 0% $523 50 17714 -001 Trunks 1961 50 51,997 $40 100% 0% 540 10 17714 -001 Trunks 1963 50 5191,519 *3,930 95% 5% $3,734 $197 17714 -001 Trunks 1965 50 *2,312 $46 100% 0% 546 50 17714 -001 Trunks 1966 50 523,586 *472 100% 0% *472 50 17714 -001 Trunks 1969 50 *48,394 *968 100% 0% *968 *0 17714 -001 Trunks 1970 50 $53,380 *1.068 100% 0% *1,068 *0 17714 -001 Trunks 1971 50 134,079 *682 100% 0% 5682 50 17714 -001 Trunks 1972 50 *96,485 51,930 100% 0% 51,930 50 17714 -001 Trunks 1975 50 555,493 51,110 90% 10% $999 5111 17714 -001 Trunks 1981 50 53,075 562 100% 0% 562 50 17714 -001 Trunks 1981 50 548,383 5968 100% 0% 5968 50 17714 -001 Interceptors (West Valley) '2 1978 40 53,661,042 591,526 15% 85% 513,729 577,797 17714 -001 Interceptors (S. Frultvale) '3 1978 40 5714,500 517,863 100% 0% 517,863 50 17714 -001 Interceptors (River Road) 1978 40 $435,528 510,888 100% 0% 510,888 50 17714 -001 Interceptors (Fairview-Sumac)'5 1979 40 5342,418 58,560 100% 0% 58,560 50 17714 -001 Interceptors (Chestnut/N.80th) 1992 40 5166,937 54,173 0% 100% 50 54,173 17714 -001 Trunks (83rd Ave) 1981 40 536,159 5904 0% 100% 50 5904 17714 -001 Trunks (72nd. Ave) 1981 40 578,922 51,973 0% 100% 50 $1,973 17714 Sewer Rehabilitation 1978 40 5257,864 56,447 100% 0% 56,447 50 17714 North First Str Proj 1795 1999 40 5910,213 522,755 50% 50% 511,378 511,378 17714 Airport/Armory Proj 1822 1999 40 579,436 51,986 90% 10% $1,787 5199 17714 7th Str Interceptor 1999 50 51,830,709 536,614 95% 5% 534,783 51,831 17714 Pierce Str. Proj 1616 1999 50 5386,864 57,737 100% 0% 57,737 50 59,640,990 5226,335 56% 44% 5127,773 598.562 17714 -002 Sanitary Sewers -Unclassified 1963 50 51,571,146 531,423 100% 0% 531,423 50 17714 -002 Sanitary Sewers -Unclassified 1 1972 50 543,639 5873 100% 0% $873 50 51,614,784 532,296 100% 0% 532,296 50 17714 Trunks (Airport South) 1998 40 *929,583 523,240 90% 10% 520,916 52,324 17714 Ahtanum Trunk 2001 40 *1,325,000 533,125 0% 100% $0 $33,125 subtotal Transmission/Collection 52.254,583 556,365 520,916 535,449 Total Collection System 526,878,507 5626,653 57% 43% 5357,118 5269,535 City $357,118 County 5269,535 Assumes annexation of 90% of accounts and assets prior to 2002 County Depreciation Collection System 526,954 Adjusted for Annexation 9/19/01 Table 7-9 RATE BASE / RETURN ON INVESTMENT Allocation of TREATMENT FACILITY RATE BASE for Milky Basis Method Acct. Historical Accumulated Foment Less Local Credited Rate _ No. Description Coat Existing Plant Dapacla8on 2004 Deprociatod PD PD 0.00% Fedaral/StalS Grants Gr $ Cash LC LC=HC-G, 911 923 Depredation CD CD= D' $0 Base (RB) RB=LC-CD 011,923 Percent City (1) 92.60% Alloca8on County 7.4016 Rate Base City (1) 011,010 Atiocntion County 5882 _ (HC) (AD) 50 Sanitary Sewer Treatment Facility 911,923 17113 Land and Land Rights 17383 Structure 0 Improve (1945-1075/ 50yr) 5245 714 0217 382 88 17% $ 0245 711 217 382 $21_,333 0113,295 0239,988 0514,221 $2,067 03,847 034 952 92 60% 92 60% 92.60% 92 60% 7.10% 7.10% 7.40% 74016 526,236 ;132,691 0222,220 ;476,168 52,097 ;10,601 917,759 ;38,052 17383 Structure 8 Improve (14u11en-1902) 015,000,915 910 470 668 69 8054 67 4854 54 55% 75 00% _ 48 09% 45.00% 014,526,42 $ 80 397 47 $ 0474 490 5,738141 011,362 $8`18 $7,_,110 963 549 0331 195 0198 057 9617,111 17383 Structure 0 Improve (C0ppe88agen-86) 0738 044 $10,528834 0498 057 13 713322 17383 Structure 8 improve (Kiew161985) 17383 Elactrklan's Office 88 348 $7,410 963,519 56,261 03,563 528 597 $6,161 S3 563 528 597 02.60% 92 60% 92.60% 7.40% 7.40% 7.40% 81,933 S3,562 032,366 9151 5255 02,586 17383 Storage Bulidng Building Remodel $ $ 17383 17383 Lagoon Cloanout 9512,319 8512 319 100.00% $ $51L319 0512 319 51 643 806 SI 931473 5512 226 ISO) 9893,921 92.60% 92.60% 7.40% 74016 (50) 8827,771 (00) 566,150 17383 Structure 5 improve (Pease -1989) 02,537 728 $1 643,106 61.77% 25.59% 55.19% 5 Sm.9 ,728 57,544,768 5928 109 17383 Structure 6 Improve (Hump0rey-1993) 013,159,845 13,367 197 55 615 07 $ $5,614 295 0415 884 02.60% 92.60% 7.40% 7.10% 95,198,537 0385,108 ;415,158 $30,775 17383 Lagoon Cleanout wo 1093 Prot. 1612 1(928 109 0512 226 17383 9l000944 Storage wo 1062 poi. 1556 9683172 594,756 575,721 5226 107 556 854 545 133 33 06% 60.00% 60.00% 5 S S 0683,872 001 756 S75 721 0226,107 056 851 545 433 0157 765 537 903 530 289 92.60% 92.60% 02.60% 7.10% 7.10% 7.40% 5423,890 035,096 928 017 533,075 92,505 92,241 17383 Blosotids Lndsc ng w01096.16511636 17383 Trldd65 Filler Rehab wo1113 po11673 17383 Structure & Improve (IMCO-1908) 57,371,258 1367 291 913 032 4.98% 5.00% S 07 371,258 $260131 912 685 188 309 036L294 $11,0,32 01 269 18 831 57,003,064 _1241,399 011 416 5169478 92.60% 92 60% 92.60% 92.60% 7.10% ;6,485,671 5515,293 17383 Equipment Prepurchase Pro( 1566 5260,631 S 7 40% 7.10% 7.40% 5220 277 510 572 9156,937 515 322 ;845 512,541 17383 Class A Biosolids oro( 1752 All 605 01 269 10.00% 10.00% $ 17383 WWfP F9068y Rehab poi 1804 11188,309 18 831 552,120,970 023 732 216 521( 538 97 822 890 996 S7 029 837 015,861,159 914,687,433 51 173,726 Equipment 18273 Structure 0 Impove (1945-1975/ 2Syr) 51,021,896 91 021 896 100.00% 52.73% $ S 1 021 896 597 567 01 021 896 551 452 (00) 946,115 92.60% 92.60% 7.4016 7.4016 (90) 942,703 (501 53 413 50 18273 Industrial Coaln95econdary Digester 997,567 551 152 18273 Egpent 56,527 $6 527 100.0016 $6 527 .6 527 50 92 60% 7.4016 50 18273 Biome Rehab w061120 p0401606 Bird Centrlge Rehab w001126 p191666 Mochical Improv wo 1142 oro( 1713 11_5_,019 $59,001 11538,878 51 011 935,401 5173 745 60,00% 60.00% 32,21% 40,00% 60.00% S 985 019 059 001 0538 878 $4 147 5330 326 51 011 173 745 51,659 5198 195 534,007 523,601 0365,133 92.8016 92.60% 92.60% 74016 7.10% 7.4016 931 491 ;21 854 9338 113 S2 517 51 746 $27 020 18273 18273 18273 Service Air Comp poi 1716 54,117 SI 659 92,188 92.60% 92.60% 7.10% 7.10% 52.304 ;122,353 9194 59 778 10273 SCADA lmpoc Pro) 1637 0330,326 9198 195 0132,130 18273 Air Commissar 54,963 993 20.00% 5 9'-rI 02 118 321 9°3 51 540 879 53,971 92,60% 74016 53.677 5294 subtotal Treatment Facility 52 148,324 51 540 879 $607,145 $562,494 ;44 951 General Plant 18637 Office Furniture and Equipment 111175 928,232 030 758 528,232 86 95% 100.00% S0 044,375 0 028 232 31,756 28 232 85,817 50 92.60% 92.6014 7.10% 7.40% 95 386 50 5430 90 5493 50 5291 8935 $2 154 18287 Tools Shop 8 Garage Equipment 18187 Laboratory Equipment 066,801 97,639 060 136 07 639 90.02% 100.00% 09 45% 79.. 7% SO 0 966 001 0 $7 639 0 37 232 0 63 a 66 960 136 57 639 33302 50 8215 439 96,665 50 93,929 912,895 920,107 92.6014 92.60% 92.60% 92.69% 7.40% 7.40% 7.10% 7,49% $6.172 50 53,6311 511 756 ;26 953 18567 Power Operated Equlpmnt 10727 Communication Equipment ;37,232 563,066 033,M2 50 371 18887 Mieasneouo Equipment subtotal &moral Pint 0247 545 6210 139 1999.2002 Plant lmpevemnte est. SCADA Y2K Update 0160,000 32 000 20 00% 50 160 000 0 0250 000 3 300 000 1 777 000 51 145 000 32 000 550 000 90 50 50 9128,000 5200,000 53,300,000 ;1,777,000 51,443,000 53,787,000 92.60% 92.60% 02.60% 92.60% 02.60% 92,60% 74016 7.40% 7.4016 7.40% 7.40% 7,10% 5115,528 8165 200 53 035 800 $1,615502 51 338 070 53489.242 $9 172 , 911 600 8244 200 5131 193 5106 930 5274 759 5785,653 Fadlity Plan Update wo1099 pot1640 5250,000 53,300 000 550 000 SO 20.00% 0.00% SO Odor (ligation Trickling RIM, Mechanism (2001) 51,777,000 SO 0.00% 0 00% 50 00 Blosdids Thickening (2002) 51,445,000 SO Biosdids Handing (2003) 53,767,000 "0 0 00% 0 3 767 000 0 subtotal Plant Impow:m95ts 510 699 000 582 000 010 690 000 882,000 810,617,000 50 831 342 Working Capital 53,504,025 )I 45 / 365 1132,003 92.60% 74016 9400 033 531 960 15 days of O&M expenses Total Treatment Fealty 568,040,787 0.25 573 533 020 538 971 035 997 788 $8 071 151 ;27,558,637 025 519 295 52 039 339 (1) For Ws table Citylvresents all users ince Coun retail customers. City 125 519 293 979 431 Lass Coon Contributions Connectln County till Count to Data ChargthOttialmiln0 Base T,as00 admit lo 10% CCRC@2A nt Facility per annexation) 52 039 339 5519810 841 517 11,441.012 (2) Alocation based upon percentage of /low from usw group morn7 813 County (2001) 740% Assume 90% annexation - County (2002) 0.73% (ham 'labia 7.11) Return 11 on Invenlment O 5.97% 906 4, A419e1 for g nexatln $0.643 10/9/01 Table 7-10 RATE BASE/RETURN ON INVESTMENT Allocation of COLLECTION SYSTEM for Utility Rate Basis Method Acct. Historical Accumulated Percent Depreciated (PD) Less Fed/State Grants IGrL Local Cash (LC) Credited__ Depreciation (CD) CD - PD'LC Rate Base Percent Allocation Cid County (4) Rate Base Allocation City (1) County No. Description Cost Existing Plant Depreciation 1997 jR(1). RB - LC -CD 11) j41 (HC) (AD) PD - AD/HC 0.00% LC - HC -Gr $487,938 Sanitary Sewer Transmission/Collection 17114 Land and Land Rights $487,938 $0 $0 $487 938 17384 Structure (Don Young Property) 1993 Laterals $1,010 912 $12`57239 _$235,900 $3,610,385 _$517,592 23.34% 29.22% $1,010,912 $12,357,239 $235,900 $775,012 88,746,854 $222107 89.15% 10.85% $690,923 $4,198,490 $84,089 $4,548 364 17714 $3,610 385 48% 52% 17714-001 Trunks $740,399 69.91% $740,399 $517,592 100% 0% $222,807 $0 17714-001 Interceptor (1985 W.V.) Inter (1985 S. Fruitvale8 River Rd.) $3661,042 $1,150 028 $2 105,099 $661,266 57.50% 57.50% $3_,239,_992 $421,050 $159,254 $242,103 191,571 $178946 15% 85% ;26,842 $67,683 1152 104 10 17714-001 1990,774 j67 683 100% 0% 17714-001 Interceptor (1985 Fairview -Sumac) Interceptor (1992 80th Ave.) $342418 $166,937 $36,159 $78 922 $257,864 $211,620 $188 330 $37,561 418 080 _$39,461 $1411,272 $31,_743 55.00% 22.50% 50.00% 50.00% 57.50% 15.00% $264,188 $78 230 $166„937 $36,159 $18,922 $257,864 _1178,264 $43A27 $37,561 118,080 $39,461 $35,204 $129 376 _ $18,080 $39,461 100% 0% _ 0% 0% 100% 18% 0% 100% 100% 100% 0% 0% $35 204 $0 $0 $0 $109,592 $27,274 $0 $129,376 $18,080 $39,461 $0 10 17714-001 17714-001 Trunks (1985 83rd. Ave) Trunks (1985 72nd. Ave) 17714-001 17714-001 Trunks (1986 Citywide Rehabilitation) 1148272 126,740 $109,592 $151 524 17714-001 Trunks (1985 S. Broadway Inter) 17714-001 Trunks (1995 7th Avj $1,830.709 $386,864 $910,133 $1,009,019 $1,614,784 $36 614 $7 737 $22,755 $25,225 $1,009,240 2.00% _$33,356 $1,830 709 $386,864 $36,614 $1,794,094 $379,127 $887,378 177 450 50% 100% 50% 50% 50% 0% 50% 50% 1897,047 $379,127 $443,689 $38,725 $605,544 $897,047 $0 $443,689 $38,725 $0 17714-001 Trunks_ (1997 Pierce Ave.) 2.00% 2.50% $7,737 17714-001 Trunksj1998 N. 1st Sir.) $910,133 _$79,436 _$22,755 $1,986 17714-001 Trunks (1998 Airport South) 2.50% 62.50% $929,583 17714-001 Sanitary Sewers -Unclassified (63-72) $1,614,784 $1,009,240 $605,544 100% 0% subtotal Transmission/Collection $26,252,986 $8,695,260 $5,457,893 $20 795,093 j6 089,023_ $14,706,070_ $7,742,947 $6,350,935 - - Working Capital 45 days of O&M expenses $2,141 038 X 45 / 365 $2.63,964 57% 43% $149,969 1113,195 Total Collection System $28,394,024 18_,19_1,260 _55,457,893 120,795,093 66 089,023_ 114,970,033 $7,892,916 $6,464,930 For this table, City represents all users except County retail customers. Total Rate Base Collection City 17,892,916 (1) Less County County Contributions to Date _ $6,464 930 -- L D Participation CCRC @ 1/3 $1,459,893 $274,905 $166,730 Connection Charges (trunkagedcollection) - County Rate Baase Collection � I $4,563,402 isse Table 7-11) Return on I vaatment @ 5.97% $272,435 Adjust for annexation - $27,244 10/9/01 Table 7-11 Non -owner (County) Retail Customers Development of Rate of Return for Utility Basis Method Rate Base see Table Amount SU 232 Treatment 7-9 $27,550 806 SU 211 Collection 7-10 $14,963 343 Total Rata Base (SU 232+SU 211) $42,514 149 Outstanding Outstanding_ Principal as of 12/2001 % Wastewater Wastewater Princi.ai % SU 232 % SIJ 211 Outstanding Principal (SU 232+SU 211 Interest Rate 2002 Composit Figure Bonds/Loans '78/96 Revenue Bond $2,370,000 100.00% $2 370 000 76.59% 17.47% $2,229,222 4.60% 102,544 '91 Revenue Bond $4,800,000 91.75% $4 404 000 100.00% 0.00% $4,404,000 6.00% 264,240 State Revolving Fund $909 647 100.00% $909 ft47 0.00% 100.00% $909,647 4.00% 36,386 Proj 1300 PWTF $444633 100.00% $444,633 100.00% 0.00% $444,6:33 L00% 4,446 Proj. 1497 PWTF $740,772 100.00% $740 772 0.00% 100.00% $740,772 L00% 7,408 Proj. 1526 PWTF $360,000 100.00% $360 000 0.00% 100.00% $360,000 1.00% 3,800 Proj. 1556 PWTF $2,216,572 100.00% $2 216572 100.00% 0.00% $2,216,572 1.00% 22,166 Proj. 1616 PWTF $572,587 100.00% $572 587 0.00% 100.00% $572,597 1.00% 5,726 Proj. 1638 PWTF $2,450,616 100.00% $2,450,616 100.00% 0.00% $2,450,618 1.00% 24,506 Proj. 1710 PWTF $175,276 100.00% $175 276 0.00% 100.00% $175,278 1.00% 1,753 Proj. 1942 $1,420,000 100 00% $1420 000 100.00% 0.00% $1,420,000 4.00% 58,800 Proj. XXX $3,000,000 100.00% 3 000 000 100.00% 0.00% $3,000,000 4.00% 120,000 Total Outstanding $19,460,103 $19 064 103 $18,923,325 Principal Owner Equity In SU 232 + SU 211 $42,514 149- $18,923,325 = $23,590,824 8.00% 1,887,286 _ (Rate Base - Outstanding Principal) Average Interest Rate $42,514,149 5.97% ?,536,841 RATE OF RETURN 5.97% 9/19/01 Table 7-12 Allocation of Infiltration and Inflow (1/I) City Retail County Retail Terrace Heights Union Gap Projected 2002 Billed Flow (Table 5-1) 3,494,674 28,079 217,896 289,921 % Billed Method 2002 Total % Total Flow 1 1/1 Combined Flow % of Retail 86.70% 0.70% 99.20% 1,824,789 5,319,463 90.62% 0.80% 14,662 42,741 0.73% 5.41% 7.19% 0.00% 0 217,896 3.71% 0.00% 0 289,921 4.94% Total Billed 4,030,570 100.00% 1,839,451 5,870,021 Total Flow Received at Plant 5,870,021 County County % Total % Total Year Retail Flow Plant Flow Non -billed 1/I Flow 1,839,451 2000 7.51% 7.01% 2001 7.81% 7.14% 2002 0.80% 0.73% 2003 0.81 % 0.74% 2004 0.83% 0.76% 2005 0.85% 0.77% 2006 0.87% 0.79% All flow from TH and most from UG is metered where it enters Yakima's system, therefore for this report no I/1 is allocated to them. Method 1 (1990 City report) Allocate non -billed flow on equal percentage as billed flow. County Factor = County Retail % of Total Flow = 0.80% 0.73% 9/19/01 SECTION 8 NON -OWNER RETAIL STRONG WASTE AND SEPTIC CUSTOMERS Introduction: In Section 7, rates for non -owner (County) retail customers who discharge "normal" domestic flow as defined in the "1976 Agreement" were developed. In this section, rates using a UTILITY RATE BASIS for County customers discharging Strong Waste and for septic customers wherever they reside will be developed. The "1976 Agreement" establishes a base level of 300 parts per million (ppm) for concentrations of Biochemical Oxygen Demand (BOD) and Suspended Solids (SS). Discharges that contain concentrations of these pollutants in excess of 300 ppm are considered Strong Waste discharges and are subject to a surcharge. Although retail rates are not bound by this threshold, and National studies indicate that "normal" domestic sewage has concentrations of only 240 to 200 ppm of BOD and SS respectively, these concentration levels (300/300) are currently being used to determine non -owner (County) Strong Waste retail customers. As presented in Section 2, Public Law 92-500, Section 204 (b) (1) (A) states that the costs of operation and maintenance of a sewerage system must be recovered from sewer service charges that are proportional to costs of providing service. Also, 40 CFR Chapter 35.835- 5 states that no grant may be awarded unless that applicant has an equitable system of cost recovery. "Such system shall provide for an equitable assessment of costs whereby such assessments upon dischargers of industrial wastes correspond to the cost of the waste treatment, taking into account the volume and strength of the industrial, domestic, and commercial wastes, and all other waste discharges treated...." The cost of service study is a part of the development of a wastewater service charge system that bases charges for service, and capital cost allocation, on the flow and strength characteristics of customers. Strength characteristics should include customer's BOD and SS levels, although additional strengths may also be included. In conjunction with implementation of the 1994 COS, individual strong waste categories were established which included most concentrations encountered. Each business was assigned to the most appropriate category based upon national data or results of the ongoing testing 2001 COS Section 8 Page 1 October 10, 2001 program of each business group; i.e. fast food, bakeries, etc. Table 8-2 shows the concentrations of BOD and SS of each of the categories into which a business has been assigned. Several categories do not presently have any businesses assigned Any individual customer within any a may reast that their business be tested and billed separately. Under this arrangement, this business will be sampled and tested. The results of these tests, be they higher or lower than the presumed concentration, will then be used to calculate their future billings. There is a fee for the individual sampling and testing as outlined in Section 6. Several businesses have successfully established that the concentrations of their discharge are lower than the presumed levels. The rates for these accounts have been adjusted accordingly. The City presently looks only at the concentration of BOD and SS when determining strong waste charges. Staff is reviewing the cost impact that ammonia and fats, oil, and grease (FOG) have on the system and anticipate proposing a surcharge amount as mart of the enhanced surcharge I y G a,.s e e e aw e.e a part Pretreatment Program (see Section 6). Purpose of Cost of Service Study: The rate setting methods used in this section are the same as used in Section 7. Again, the purposes of this cost of service study for non - owner customers of the Retail System are to: • Allocate operating, depreciation, and return on investment costs of providing service to non -owner customers. • Determine whether or not non -owner retail customers receiving service from the City's sewerage system are paying fair and appropriate shares of costs of providing service. • Use the results of the retail cost of service study to establish rates and charges for non -owner customers. Cost of Service Procedure: The cost of service procedure, which will result in the appropriate allocations, requires that we formulate the following information about avnancac to tha cvctam Fnr all rata ralriilatinnc ctaff iicarl nrniartarl 2001 COS Section 8 Page 2 October 10, 2001 information for all years of the planning period; however, the included Tables show detailed information for only the Test Year of 2002. 1) Operation Expenses A. Treatment expenses and applicable allocation. B. Collection expenses and applicable allocation. 2 3 ) ) Depreciation expense A. Treatment Facility expenses and applicable allocation. B. Collection System expenses and applicable allocation. Return on Investment (ROI) A. Treatment Facility rate base and applicable Rate -of -Return. B. Collection System rate base and applicable Rate -of -Return. • The first step is to organize cost data in terms of functions performed on the wastewater system. This step is called functionalization. For this process staff employed the same categories historically used by the maintenance department to identify separate processes (areas) within the treatment facility. All capital and equipment expenses were assigned to one of these areas. The initial capital investment and current annual depreciation for each area are listed on Table 8-4. • The second step in the cost of service study involves the classification of operating expenses and capital investment in sewer utility plant in service to cost components (called parameters in EPA rules). The cost components identified for the cost of service analyses are 1) flow, 2) biochemical oxygen demand (BOD), 3) suspended solids (SS), 4) Septage, and 5) Rudkin Road. The loading parameters (percentage) used are those recommended by an EPA bulletin. The use of these parameters shifted expense slightly from SS to BOD compared to those used in previous COS. City staff does not presently account for treatment plant operation costs separately among the above components with the exception of Food Processing Wastewater (SU 234) and Rudkin Road (SU 215). Therefore, as with previous reports, we allocated all expenses based on a percentage developed by the classification of the annual depreciation expenses (capital investment) of the treatment facility. This process is shown on Table 8-4. 2001 COS Section 8 Page 3 October 10, 2001 • No collection expenses (SU 211) are presently allocated against strong waste or septage charges. This will change if/when FOG charges are initiated. The assignment of depreciation expense for the wastewater treatment plant to the cost components, as shown on Table 8-4, indicate that much of the investment in the treatment plant has been made to correct for BOD and SS strengths found in the system influent. The percentage classifications of costs to the various components were determined to be as follows: Classification of Treatment Facility Depreciation Expense Flow 18.25% BOD 49.65% SS 31.53% �, Disposal n A not Septage Disposal C.` 2 io Rudkin Road Q.15% TOTAL 100.00% Depreciation expenses that are unique to the Food Processing Waste system and to the Rudkin Road Lift Station are recorded separately. Also, all Operation and Maintenance expenses for the Food Processing system (SU 234) and to the Rudkin Road lift Station (SU 215) are accounted for separately Therefore, for use to allocated Treatment Facility (SU 232) O&M expense, the above percentages must be adjusted. This adjustment yields: rias �ifino+ion of Trop+men+ C�nili+v (ISLi\A ('nc+ �Qo�n��.ciuv�� v1 11 cau 1 IL 1 ILIA../11117 V11IVI vu+2a Flow 18.27% BOD 49.73% SS 31.58% Septage Disposal 0 42% TOTAL 100.00% 2001 COS Section 8 Page 4 October 10, 2001 Organization of Cost of Service Tables - lion -owner Strong Waste Customers; On all of the tables in this section, "City" refers all sewer customers except the non -owner retail customers, who are designated "County". 1) projected for each year of the planning period was taken from Table 4-6. 2) Table 8-6 shows the Treatment Facility Depreciation Expense (SU 232) projected for the test year 2002. This is not anticipated to vary significantly throughout the planning period. 3) Table 8-7 shows the Treatment Facility Return on Investment (SU 232) • The Rate Base for 2002 is projected to be $27,558,637. Using a Rate of Return factor of 5.97% yields a Return on Investment of $1,645,251. The Rate Base will decrease by the amount of additional depreciation credited, and will increase by the amount of new capital investment in the facility, during each year of the planning period. For this report, staff anticipated this value to remain constant throughout the planning period. 4) Utility Tax (SU 232) • Per City Municipal Code, Utility Tax is charged at the rate of 14% on gross revenue. 111 1 •. - .. 1 - The summation of these expenses is the total costs for treatment of these pollutants under a utility rate basis. As indicated on Table 8-3, for 2002 total expense equals: Hydraulic = $ 1,710,968 BOD = $ 4,657,168 SS = $ 2,957,437 5) Hydraulic and Pollutant loadings. As presented in on Table 5-1 and 5-6, staff projected the total Hydraulic, BOD and SS loading for 2002. Hydraulic = 5,870,021 UOC BOD = 10,573,271 lbs. SS = 6,953,928 lbs. 2001 COS Section 8 Page 5 October 10, 2001 Utilizing 2 0 0 2 data yields a unit cost on a Utility Basis for treatment of Hydraulic = $1,710,968/ 5,870,021 = $ 0.291 per UOC BOD = $4,657,168/ 10,573,271 = $ 0.440 per pound. SS = $2,957,437/ 6,953,928 = $ 0.425 per pound. The same calculation was performed using data for each year of the planning period. Also calculated were the cost for hydraulic flow through the Treatment Facility and the cost to receive Septage. Results of these calculations are shown near the bottom of Table 8-3. Cnnclusinns! Strong Waste is defined by the 1976 Agreement as that having BOD and SS concentrations in excess of 300 ppm. This is the threshold level used for this report, although National studies indicate that "normal" domestic i_ i a•�.-� of L. 200 +�. 240 nnrr. of BOD and �.Q sewage has concentrations only to ppm of Q. Therefore, even with rates set at the full cost of treatment, the City Retail customers will still be slightly subsidizing this user group (non - owner strong waste customers). Public Law 92-500, Section 204 (b) (1) (A) states that the costs of operation and maintenance of a sewerage system must be recovered from sewer service charges that are proportional to costs of providing service. Section 3 of this report outlines upcoming Capital Projects. Nearly all of these projects are necessary because of the increasing loading of BOD r, 1 cc vv. Table 8-2 demonstrates the effect this rate adjustment will have on the unit cost of each constituent and the effect it will have on the existing County strong waste users by category. The percentage adjustment is caused two factors in addition to general increased cost. 1) The actual and projected loading of each constituent, BOD and SS, has increased from those projected in the 1996 COS. 2) The classification of the facility shifted costs slightly from SS to BOD. The total proposed rate adjustment to Hydraulic is 16.40%; to BOD is —17.93%, and to SS is —14.81%. 2001 COS Section 8 Page 6 October 10, 2001 In the wake of the 72nd Avenue Annexation, it is uncertain if any customers will remain in this customer class with the possible exception of the Central Washington State Fair. Recommendations: Staff recommends County retail strong waste rates be decreased to the average Full Cost of Treatment for the years 2001-2006 in one phase: Implement Phase One. This would decrease rates to the average Full Cost of Treatment for the period 2001-2006. Existing: BOD = $ 0.502 per pound SS = $ 0.493 per pound Phase One: BOD = $ 0.412 per pound SS = $ 0.420 per pound Septage Waste Rates Staff examined the last retail non -owner customers, the septage waste customers. Some of the septage waste customers live within the City limits, but since no general City funds are used to support the Wastewater System, these customers have not been contributing to the Wastewater System. Therefore, these customers are non -owner customers as are County septic tank owners. In 1992, the plant received 2.9 million gallons of septage waste. Representative samples were taken weekly and analyzed for strength (BOD and SS). The average of these weekly tests gave a BOD concentration of 7,500 ppm and SS concentration of 25,900 ppm. These concentrations were utilized to calculate rates. 2001 COS Section 8 Page 7 October 10, 2001 Due to a 1993 rate increase, the quantity of septage delivered to the Wastewater Facility dramatically decreased. The vast majority of the septage waste is currently being disposed of at the County Cheyne I andfill. The County anticipates they have capacity for numerous years of septage waste at this site. Therefore, we anticipate receiving only a very limited quantity of this waste during the planning period. This • a . .•-- • •-1 . • businesses within the coilectian system boundaries. In calculating a rate for what quantity of septage we do receive, staff reviewed the plant classification process which separately identified costs riariinaterl for the septage receiving station, transfer pumps, and that labor to operate and maintain that separate facility. As demonstrated on Table 8-4 this is 0.42% of total treatment expenses. Staff then added the unit costs of treatment for Flow, BOD and SS developed on Table 8-3. and rate of 1. portion of i4. .. .+.. are fixed The depreciation return portion these eApvliovo fixed and therefore continue even when a small quantity is received. if these costs were spread against the small quantity we received in 2000, the resultant cost would be excessive. Therefore, staff chose to use a quantity 200,000 gallons while calculating the rate. This allows the of V V gallons v Va+1 establishment of a rate that accurately reflects the cost of receiving and treating this product under normal situations. Recommendations; Staff recommends septage waste rates be adjusted to the Full Cost of Treatment for 'die dears 2001 _2006 in one phses: r 1GQ1.111 111. for LJ IG years LVV 1 -LV VV 111 one r.'l 144vV V. Implement Phase One This increases rates to that calculated by using PHASE ONE strong waste unit costs: Existing: = $ 0.278 per gallon Phase One: = $ 0.316 per gallon 2001 COS Section 8 Page 8 October 10, 2001 Table 8-1 Full Cost of Treatment Proposed Rate Adjustment County Retail Strong Waste/ Septage and Exceptional Waste Charges 10/10/01 hydraulic BOD SS Septage Existing $0.250 $0.502 $0.493 $0.284 Proposed Average $0.291 $0.412 $0.420 $0.316 2001-2006 16.40% -17.93% -14.81% 11.27% 10/10/01 Table 8-3 UTILITY BASIS Allocation of Treatment Facility Expenses (SU 232) Unit Cost Flow, BOD, SS, Septage Service Description Projected Expense 2002 Flow 18.27% Cost Component BOD 49.73% Factor SS 31.58% (%) Septag_e 0.42% Cost Component $ Unit Flow BOO ' SS Septage (see Table 8-4) 232 Operations (1) 3,504,025 640,185 1,742,552 1,106,571 14,717 232 Depreciation (2) 3,065,554 560,077 1,524,500 968,102 12,875 232 R -O -I @ 5.97% (3) 1,645,251 300,587 818,183 519,570 6,910 232 Utility Tax @14% 1,150,076 210,119 571,933 363,194 4,830 Total 9,364,906 1,710,968 4,657,168 2,957,437 39,333 Hydraulic Flow Flow Cost Total UOC 1,710,968 5,870,021 _ ij $0.291 • =r UOC treated (1) See Table 4-6 (2) See Table 8-6 Biochemical BOD Oxygen Demand Cost Total lbs. 4,657,168 10,573,271 = Vii) $0.440 • :r •ound treated (1See Table 8-7 (J See Table 5-1 (5) See Table 5-6 See Narrative Suspended Solids SS Cost _ Total lbs. 2,957,437 6,953,928 _ (E1_ $0.425 • =r •ound treated (6) Dedicated Septago Septage Waste Cost Total gals. 39,333 200,000 = 1§J___ $0.197 per gallon received _ Dedicated Calculation for the Year Hydraulic $0.285 BOD $0.454 SS $0.420 Septage $0.191 2001 2002 $0.291 $0.440 $0.425 $0.197 2003 $0.291 $0.419 $0.421 $0.198 2004 $0.292 $0.402 $0.419 $0.201 2005 $0.293 $0.386 $0.417 $0.203 2006 $0.294 $0.372 $0.415 $0.206 6 year average $0.291 $0.412 $0.420 $0.199 10/10/01 Table 8-4 Functionalization and Classification of Wastewater Treatment Facility Plant Treatment Facility 2002 Cost Component BOD Factor MI Septage Rudkln Road " 2002 Cost Co • •nent $ Area Areas Plant Value Flow Depreciation Flow BOD S5 S.•ta.e Rudkln 6 Road " 1 Influent Area 8,409,588 Struct Equip 95 0 0 0 0 98 5 2 0 0 99,677 94 693 0 0 0 4 984 0 77 447 0 75 898 1 549 0 2 Primary Clarifiers 1,917,550 Struct 100 0 0 0 0 11 222 11 222 0 0 0 0 Equip 0 35 65 0 0 43,318 0 15,161 28,157 0 0 3 Trickling Filters 6,470,732 Struct 75 25 0 0 0 10,435 7 826 2 609 0 0 0 Equip 0 100 0 0 0 246,190 0 246 190 0 0 0 4 Activated Sludya 7,943,910 Struct Equip 75 0 25 100 0 0 0 0 0 0 139,913 104,1)35 0 34 978 146 672 0 0 0 0 0 146,672 S Chemical Treatment 4,443,069 Struct 100 0 0 0 0 62 180 62 180 0 0 0 0 Equip 100 0 0 0 0 : 83 407 83 407 0 0 0 0 3/5 Odor Control 3,688,414 Struct 0 60 40 0 0 85,737 0 39 442 0 0 Equip 0 60 40 0 0 64 980 0 38 988 25 992 0 0 6 Solids Building 12,154,079 Struct Equip 0 0 50 50 50 50 0 0 0 0 48,043 0 24 022 24 022 0 0 552 778 0276 388 276 388 0 0 7 Digester 6,994,042 Struct 0 50 50 0 0 78 005 1 39 003 39 003 0 Equip 0 50 50 0 0 212 3760 106 106 188 0 0 8 Lagoons/BS Storage 3,958,431 Struct Equip 100 0 0 50 0 50 0 0 0 0 25 448 illigarlal 0 0 0 0 154 884 0 77 442 77 442 0 0 8 Boller 560,110 Struct 10 45 45 0 0 9 965 997 4 484 4 484 0 0 Equip 10 45 45 0 0 8 038 804 3 616 3 616 0 0 10 Garage 1,495,958 Struct 36 29 28 2 5 18 941 8 099 4 913 MUM 339 847 Equip 38 29 28 2 5 50 899 IIIME1311111111=111111.1=111111111=11 2 545 11 Misc. 360,751 Equip 30 30 30 5 5 5 037 1 511 1 511 1 511 252 252 1 2 Industrial Waste • 1,175,011 Struct 75 25 0 0 0 8 929 5 197 =EMI 0 0 0 Equip 0 100 0 0 0 34 398 �' 1 • 1 3 Rudkln Road P.S. •' n/a Plant and Dedicated Stall hilted separately 1 4 Laboratory 2,709,538 Struct 5 58 35 2 0 29 875 1 494 17 328 10 456 598 0 Equip 5 58 35 2 0 54 852 IIMMEIMIIIMMI 19 198 1 097 0 subtotal 82,281,181 2 339 642 426 878 1 181 640 737 645 9 836 3 844 (1996-1998) Treatment Plant Improvements Included In show Values -- Total WV/TP ClassHIcatlon Factor 1 18.25% 49.85% 31.53% 0.42% 0.18% Ad{ust for Rudkln Rd. costs which Is accounted separately 18.27% 40,73% 31.58% 0.42% n/a • Industrial waste infrastructure Is now Included In treatment stream, allocated same as Tricklin fitter. •• Rudkln Read Operating expenses aro In SU 215 1 1 1 1 1 9/20/01 Table +8-6 DEPRECIATION Allocation of TREATMENT FACILITY for Utility Basis Method Acct, Dal Est Historical I Annual No. Description AcquireLife Cost Existing f I Depreciation Plant I 2003 Sanitary Sewer Treatment Facility 17113 Land and Land Rights $11,923 $0 17383 Structur & Improv 1959 40 $21,147 $0 17363 Structur & Improv 1966 40 $221,950 $5,549 17383 Structur & Improv 1970 4n $2.617 $65 17383 Structur & improv (Pease) 1989 40 $422,642 $10,566 17383 Electrician's Office 1986 20 $8,348 $417 17383 Storage Building 1991 20 $7,410 $371 17383 Building Remodel 1992 20 $63,549 $3,177 17383 Structur & Improv (Pease) 1989 20 $877,753 $43,888 17383 Lagoon Cleanout 1989 10 5512,319 SO 17383 Struct & Improv (Mullen) 1981 40 58,345,191 5226,512 17383 Struct & Improv (Mullen) 1981 2n $4 58n.n72 SO 17383 Struct & Improv (Mullen) 1981 1 5 5352,140 50 17383 Struct & Improv (Mullen) 1981 1 5 5633.694 50 17383 Struct & Improv (Mullen) 1981 1 5 $499,418 50 17383 Struct & Improv (Mullen) 1981 1 5 5328.308 50 17383 Struct & Improv (Mullen) 1981 15 5202,718 $0 17383 Struct & Improv (Mullen) 1981 1 5 579,373 50 17383 Struct & improv (Copenhagen) 1985 40 $249,477 56,549 17383 Struct & improv (Copenhagen) 19065 20 5295,775 520,704 17383 Struct & improv (Copenhagen) 1985 15 5192,792 50 17363 Struct & improv (PKS) 1969 40 $6,773,968 $177,817 17383 Struct & Improv (PKS) 1989 20 51,849,685 $129,478 17383 Struct & Improv (PKS) 1989 15 51,905,181 SO 17383 Structur & Improv (Pease) 1989 1 5 $1,237,333 582,530 17383 Truck Scale wo 1093 Proj. 1612 1995 20 $148,800 57,440 17383 Biosolids Storage wo 1062 proj. 1556 1995 20 5614,055 530,703 17383 Lagoon Cleanout wo 1093 Proj. 1612 1995 10 $779,309 $77,931 17383 Biosolids Landscaping wo1096 proj1636 1995 10 $94,756 59,476 17383 Trickling Filter Rehab wo1113 proj1673 1995 1 0 $75,721 $7,572 17383 Compost Turner wo 1062 proj. 1556 1995 1 0 569,817 56,982 17383 Struct & Improv (Humphrey) 1995 40 54.366.722 5291.260 17383 Struct & Improv (Humphrey) 1995 20 $2.004,444 5100,222 17383 Struct & Improv (Humphrey) 1995 1 5 56,788,679 5169,717 17383 Equipment Prepurchase prof 1566 1997 20 5260,631 513,032 17383 Struct & Improv (IMCO) proj 1638 1999 1 5 52,781,878 $188,362 17383 Struct & improv (IMCO) proj 1638 1999 20 $2,447,607 5124,409 17383 Struct & Improv (IMCO) proj 1638 1999 40 $2,141,773 $54,523 17383 Class A Biosolids Proj 1752 1999 1 0 $12,685 51,269 17383 r•rTP Facility Rehab o__j 1804 1939 1 0 5183,309 51n801 subtotal Treatment Facility 552,429,969 51,809,351 18273 Sewage Disposal Equip 39-45 40 536,080 $0 18273 Sewage Disposal Equip 1991 40 561.487 $1,537 18273 Sewage Disposal Equip 1967 25 51,021,896 50 18273 Sewage Disposal Equip 1987 1 0 $6.527 $0 18273 Blower Rehab wo#1120 proj#1696 1995 10 585,019 $8,502 18273 Bird Centrfge Rehab wo#1126 prj#1666 1995 1 0 559,001 55,900 18273 Sludge Grinders wo#1142 proj#1713 1996 1 0 5135,965 513,597 18273 Hot wtr pipng/Elect wo#1142 proj#1713 1996 20 $342,503 $17,125 16273 HVAC equip wo#1142 proj#1713 1996 1 5 560,410 54,027 18273 Service Air Comp wo#1138, proj#1716 1997 10 54,147 $415 18273 SCADA system improvements Proj 1637 1997 5 $330.326 $66,065 18273 Air Compressor 1998 1 0 $4,963 $496 subtotal Treatment Facility 52,148,324 $117,664 18287 Tools, Shop & Garage Equipment 1983 1 0 $4,442 SO 18287 Tools, Shop & Garage Equipment 1985 10 57.798 SO 18287 Tools, Shop & Garage Equipment 1987 10 53,071 $0 18287 Tools, Shop & Garage Equipment 1987 1 0 52.024 $0 18287 Tools, Shop & Garage Equipment 1989 1 0 1 0 51,724 $7,544 SO 18287 Tools, Shop & Garage Equipment 1990 SO 18287 Tools, Shop & Garage Equipment 1991 10 $1,629 $163 subtotal Shop Equipment 528,232 5163 9/20/01 Page 1 of 3 Table 8-6 DEPRECIATION Allocation of TREATMENT FACILITY for Utility Basis Method Acct. Date Est. Historical Annual No. Description Acquired Life Cost Existing Depreciation Plant 2003 General Plant 18637 Office Furniture & Equipment 1982 10 31,754 30 18637 Office Furniture & Equipment 1990 10 36,518 30 18637 Office Furniture & Equipment 1990 10 35,380 $0 18637 Office Furniture & Equipment 1991 10 33,266 3327 18637 Office Furniture & Equipment 1989 10 $4,938 30 18637 Office Furniture & Equipment 1993 10 32,778 3278 18637 Office Furniture & Equipment 1993 10 34.224 3422 18637 Computer 1995 10 34,580 $458 18637 Office Furniture & Equipment 1995 10 31,785 3178 18637 Computer 1997 5 34,822 3964 18637 Computer 1997 5 34,531 3906 subtotal Equipment 344,575 33,534 18187 Laboratory Equipment 1986 10 $3,302 $0 18187 Laboratory Equipment 1991 10 $16,239 $1,624 18187 Laboratory Equipment 10 $8,574 30 18187 Sampler 1995 10 37,406 $741 18187 Graphite Fumance 1996 5 325,108 $5,022 18187lAutoclave 1997 10 36,171 $617 subtotal Lab Equipment 366,801 38,003 18567 Power Operated Equipment 1985 5 37,639 $0 subtotal Power Equipment $7,639 30 18727 Communications Equipment 1989 10 $4,386 30 18727 Communications Equipment 1990 10 34,844 30 18727 Communications Equipment 1991 10 38,355 3836 18727 Communications Equipment 1993 10 _ $19,646 31,965 subtotal Communications Equipment 337,232 32,800 18887 Misc. Equip 1985 10 32,985 $0 18887 Misc. Equip 1990 10 39,702 $0 18887 Misc. Equip 1993 10 33,976 3398 18887 Yamaha 4 wheeler 1995 5 $3,881 $0 18887 Solid waste cutter 1995 5 34,826 30 18887 Enviro track IV Into 1996 5 $5,223 $1,045 18887 5334ZTAST Copier 1996 5 $8,806 31,761 18887 [Computer 19961 5 $3,884 $777 18887 3710 Sampler 1996 5 $4,197 3839 18887 Dishwasher 1999 5 $8,350 $1,670 18887 Sampler 1999 5 $5,197 $1,039 18887 Sampler 1999 5 $4,882 $976 subtotal General Plant $65,909 $8,505 1999-2003 Plant Improvements SCADA Y2K Upgrade proj 1825 2000 5 3160,000 $32,000 Facility Plan Update wo1099 proj1640 2000 5 3250,000 $50,000 Odor litigation 1999 5 33,300,000 $660,000 Trickling Filter Mechanism 2001 20 31,777,000 $88,850 Biosolids Thickening 2002 15 31,445,000 $96,333 Biosolids Handling 2003, 20 $3,767,000 $188,350 subtotal Plant Improvements $10,699,000 $1,115,533 i TOTAL i I I $65,527,681 $3,065,554 9/20/01 Page 2 of 3 Table 8-7 RATE BASE / RETURN ON INVESTMENT Allocation of TREATMENT FACILITY RATE BASE for Utility Basle Method Acct. historical Accurnulated Percent Less Local Credited Rab No. Description Cost Existin. 0-•rociafion a.•reciatod Federal/State Cash Depreciation Base Plant 2000 AD (PD) PD.AD/HC Grants (Gr) (LC) _LC.HC-Gr (CD) CD.PD•LC (RB) RB. LC -CD (_HC)_ Sanitary Sower Treatment Facility 17113 Land and Land Rights $11 923 90 0.00% 90 511 923 50 511,923 17383 Structure 8 Improve (1945-1975/ 50yt $245`14 $15000 915 5217 382 510 470 668 88 47% 69.80% $0 514,526,425 5245 714 5474,490 5217,382 5331,1115 528,333 $143,295 17383 Structure 8 Improve (Mullen -1982) 17383 Structure 8 Improve (Ccppenhagen-86) 5738 044 3498 057 67.48% 50 5738,044 51,131,362 $498 057 5617, 41 $239988 5514,221 17383 Structure 8 Improve (Kiewit-1985) 510 528 834 58,348 57,410 563,549 5512 319 55 743 322 56 261 $3 563 02 597 5.512 319 54.551/. 75.00% 48,090/. 45.00% 100.00% $9 337 472 SO 50 SO 50 17383 Electrician's Office 58,348 57,410 563,549 5512,319 52,537,728 56,261 53,563 528,507 5512,319 51,643,1308 52,087 53,847 534,952 (50) 5893,921 55,814,295 3415,884 17383 Storage Building 17383 Building Remodel 17383 Lagoon Cleanout 17383 Structure 8 improve (Pease -1989) 52 537 728 87 643 806 64.77% SO 17383 Structure 8 Improve (Humphrey -1993) 513 159 845 53.367 197 25.5913. 55 615 077 57,544,768 5928,109 51,930,473 5512,1226 17383 Lagoon Cleanout wo 1093 Proj. 1612 5928 109 55), 426 5226 107 55.19.1. 50 17383 Biosdids Storage wo 1062 proj. 1556 5683 872 33 06% SO 5683,872 5226,107 5457,765 17383 Biosolide Landscaping wo1096 proj1636 594,756 S75 721 056,854 545 433 60.00% 60.00% 50 50 594,756 575,721 556,354 545,433 537,903 830,289 17383 Trickling Filter Rehab wo1113 proj1673 17383 Structure 6 Improve (IMCO-1999) 57,371,258 5260 631 5367,294 513 032 4.98% , 5.00% SO SO 57,371,258 5260,631 512,685 5367,294 513.032 51,269 $7,003,964 5247,599 511,416 17383 Equipment Prepurchase Proj 1566 17383 Class A Biosdids proj 1752 512 685 51 269 10.001'. 50 17383 WWTP Facility Rehab pro' 1804 5188,309 518,831 10.00% $0 5188,309 , 518,331 5169,478 552,429,970 523,732,216 529,538,974 022,890,996 $7,029,837 515,861,159 Equipment 18273 Structure 1 Improve (1945-1975/ 25yr) 51,021,896 597,567 51,021,896 551 452 100,00% 52.73% $0 50 51,021,896 597,567 56,527 585,019 559,001 5538,878 $4,147 51,021 1196 551,452 $6,527 551,011 S35 401 5173,745 91,659 (00) 548,115 00 534,007 523,601 $365,133 82,488 18273 Industrial Coating/Secondary Digester 18273 Equipment 36 527 86 527 100.0016 50 18273 Blower Rehab wo41120 proj81698 585 019 551 011 60.007. 80 18273 Bird Contrige Rehab woe -1126 prj#1666 Mechical Imprcv wo 1142 proj 1713 559,001 3538 878 54 147 535,401 3173 745 57,659 60.00% 32.24% 40.00% $0 50 SO 18273 18273 Service Air Comp proj 1716 18273 SCADA Irrproc Proj 1637 8330 326 5198 195 80,0016 SO $330,328 5198,195 5132,130 18273 Air Compressor 54 963 52 148 324 5993 01 540 879 20.00% $0 30 54,963 52,148,324 3993 51,540.679 53,971 9607,445 subtotal Treatment Facility General Plant 18637 Office Furniture and Equipment 544 575 538 758 86.95% 50 $44,575 538 758 $5,817 18287 Tools, Shop 8 Garage Equipment 528 232 528 232 100.00% 50 528,232 528,232 30 18187 Laboratory Equipment 566,801 560 138 90.02% 50 568,801 580,136 58,665 18567 Power Operated Equipment 57,639 57 639 100.00% 50 57,839 57,639 30 18727 Communications Equipment 537 232 $33 302 89.45% 50 $37,232 533,202 53,929 18887 Misallarecus Equipment 383,066 550 371 5218 439 79.87%. �0 SO 863,066 8247,545 ;50.3971 5218.439 512,895 829,107 subtotal General Plant 5247 545 1898.2003 Plant Improvements est. SCADA Y2K Update 5160,000 332 000 S50 000 SO 20.00% 20.00% 0.00% 80 $0 30 8160 000 5250,000 $3,300,000 $32,900 550600 SO 3128 000 3200,000 $3,300,000 Facility Plan Update wo1099 proj1640 5250 000 33 300 000 Odor Litigation Trickling Filter Mechanism 51 777 000 80 0.00% 80 SI 777,000 81,445,000 53,787,000 510,699,000 SO $0 50 $82,900 51,777 000 $1,445,000 53,767,000 810,617,000 Biosdids Thickening S1 445 000 93,767,000 50 50 382 000 0.00% 0.00% 80 S2 Biosolids Thickening subtotal Plant Improvements $10 699 000 Working Capital 83,504 025 X 45 / 365 $432,003 45 days d O6M expenses (4-6) Total Treatment Fedllty $69,040 787 525 573 533 529,538,974 835,997,788 58,871,154 $27558,637 (from Tsblo 7-11) Return on Investment l 5.973, 51,645,251 10/10/01 Table 8-8 PHASE ONE Unit Cost for Average Septage Waste All Costs From Table 8-3 1) Dedicated cost for receiving average gallon of septage = $0.199 / gallon 2) Strong Waste Charge for treatment of average gallon of Septage BOD = $0.412 / Ib. = 7,500 / 1,000,000 X SS = $0.420 / Ib. = 25,900 / 1,000,000 X 8.34 X $0.412 = $0.026 / gallon 8 34 X $0.420 = $0.091 / gallon Flow = $0.291 / UOC = $0.291 / 748 = $0.000 / gallon TOTAL = $0.316 / gallon Subtotal Receive and Treat = $0.277 / gallon Utility Tax @ 14% = $0.039 / gallon See Table 8-3 for unit costs of components Component concentrations from average of weekly testing program BOD = 7,500ppm SS = 25,900ppm 10/10/01 SECTION 9 MUNICIPAL WHOLESALE CUSTOMERS Note: This section is presented as information on the rate structure and anticipated revenue from a significant user group. Rates and fees paid by this group are governed by the 1976 Agreement as clarified by the 1997 Settlement Agreement and are automatically adjusted. Therefore, NO Council action is required by this Section. The municipal wholesale users of the City's sewerage system are: • The City of Union Gap Union Gap is a wholesale user of the sewerage system providing service to approximately 1,250 retail customers located within its service boundary. • Terrace Heights Sewer District The Terrace Heights Sewer District is a wholesale user of the sewerage system that provides service to approximately 1,500 retail customers located within its service boundary. With the enactment of the 1997 settlement agreement, Municipal Wholesale rates are developed using a Cash Basis. The cash basis of accounting determines the revenue requirement of a utility on the basis of cash receipts and cash outlays as they fall due. The four primary elements of cash basis accounting are: • Operating Expense• Operating expenses are the costs of operating the sewerage system on a day-to-day basis, and include costs of operating and maintaining the wastewater treatment plant and collection and disposal facilities of the sewerage system, administrative costs, and system replacement costs. 2001 COS Section 9 Page 1 October 10, 2001 • Debt Service° Debt service consists of payments of principal and interest on short and long term financing incurred by the sewerage system to purchase equipment or construct facilities. • Capital Outlays: Capital outlays consist of system upgrades or improvements to the sewerage system, or the purchases of equipment paid in cash generated from revenues or connection fees. • Tax Taxes paid to governing agencies, such as property taxes, gross receipts taxes, franchise or other types of taxes. Taxes may be characterized under operating expenses. City Utility Taxes are not assessed to Municipal Wholesale customers. State Excise Taxes are also not assessed to Municipal Wholesale customers and are, therefore, excluded from the SU 232 operating expenses (see Tahle 9_2) Other mi rlicipalities pay these directly to the State. The capacity of the treatment facility has been allocated to the wholesale customers. The allocations of capacity are: Percent City (and County of Yakima) 87.9 City of Union Gap 8.1 Terrace Heights Sewer District 4_11 100.0 Each wholesale customer's monthly billing could consist of all or a combination of the following elements: 1) Allocation of treatment plant operation expenses (SU 232) in proportion of the amount of flow, BOD, and SS generated that month. Each component will be weighted by the amount received from each customer. It is understood by all three parties that this slight modification to the previous billing practice enables each customer to pay a bill that more truly represents their overall impact to the facility. Both municipalities (Union Gap and Terrace Heights) are concerned about their wastewater concentrations and realize the financial ramifications of nn+ taking artinn to 2001 COS Section 9 Page 2 October 10, 2001 A) Limit strong waste discharges into their collection systems. B) Establish and enforce their own rate schedules that will charge their responsible accounts for strong waste discharges. 2) Allocation of the treatment plant debt service expenses (SU 232 Debt Service) in proportion to the allocated capacity of the treatment facility. A comparison with Table 4-5 shows that the City's transfers to capital accounts are not included when calculating wholesale billings. Debt Service Coverage is charged at 2.0. The City maintains a 2.0 ratio to enable the procurement of the most favorable financing available. Revenue received as debt service coverage is transferred the following year to help offset allocations of local cash contributions to Capital projects that are billed separately (see Table 3-3). 3) Allocation of collection system expenses (SU 211) in proportion to what part of the system customers may use. 4) Allocation of collection system capital expenses (SU 211) (Debt Service and cash reserves) in proportion to the allocated capacity of the collection system. Terrace Heights delivers their effluent directly to the Treatment Facility. Therefore, they have no impact on the City's collection system. Union Gap's flows do impact our collection system. To date, City has not charged anything additional for this use. Consequently, elements 3 and 4 above are set at zero ($0.00) for this report for Wholesale Municipal customers. Per Yakima City resolution D-4011 and D-4310, Union Gap is presently billed a 50% surcharge on the flows from customers who are connected directly to the City collection system without going through a meter. This "unmetered surcharge" was established to compensate for any unmeasured I/I. Additionally, the City owns and operates one major lift station at Rudkin Road All of the flow from Union Gap and some from both City and County retail systems pass through this station. Operating and capital expenses for this facility are maintained separately in service unit (SU 215). 2001 COS Section 9 Page 3 October 10, 2001 The capacity of this facility has been allocated: City (and County of Yakima) City of Union Gap Rudkin Road Lift Station Percentane Allocation 42.32% 57.68% 100.00°! Therefore, the monthly billing for the City and Union Gap also contains a charge for: 5) Allocation of Rudkin Road operation expenses (SU 215) in proportion of the amount of flow generated. See Table 9-3. 6) Allocation of capital expenses (Debt Service and cash reserves) in proportion to the allocated capacity of the Rudkin Road facility. See Table 9-3. Monthly and Year -End Adjustment Billings: Monthly billings to each wholesale municipal customer are based upon the estimated total expense and flow presented in the City's annual budget for that year times the pro -rata flow from each customer. Each year, after actual expenses and total flows are known, an adjustment billing is prepared to compensate for differences between the actual and budgeted expense and flow. Pretreatment Fees (SU 233): Wholesale Municipal customers will be charged for the testing and monitoring required of their effluent. Terrace Lloir.FL+e nnJd 1 Inion i_�n Ire rcrntiror1 tr I I ftI ILO CAIiu VI Mal vu'.r u1v �va��Jn vv program. nil mini ctar Chair own nratraatmcint The above accounting methodology was established by the "1976 Agreement" as clarified by the 1997 Settlement Agreement. Consequently, there is no consideration in this report of raising or lowering rates set by this method. Operation billings adjust automatically with expense and flow, and capital and debt service expenses are based upon allocated capacity. By reviewing the data presented in this report, it is possible to estimate what the wholesale costs to each customer will be during the planning period. This Section requires no Council action but is presented as infnrmn+inry 1-1.1n omnn+ of ors+inion+c.r1 nninme from +hic t icor earn!on is II 11V1 I IIaUVI I. 1 ICAI I1%14I IL VI C4IIUVgI.JGLLCV 7II 1%.",..1 IIV II VI11 L111.. LJVVl VIV4l.J 11J 2001 cos Section 9 Page 4 October 10, 2001 used when compiling income required from City retail rates. Table 9-1 shows these estimates. Capital Funding: For the past several years, the City, Union Gap, and Terrace Heights have contributed a total of $150,000 annually to the 472 Fund in proportion to their plant allocation. This money is used to finance moderate level replacement, capital repair, or capital improvements to the Wastewater Treatment Facility. Major capital projects are funded from the 478 Fund into which Union Gap and Terrace Heights do not directly contribute. The City attempts to secure low interest financing whenever possible for these projects. However, such options are not always available nor do they cover the full cost involved. Therefore, the City must bill Union Gap and Terrace Heights separately for their share of any cash amount expended on these projects. Current practice is to credit the amount paid by each customer as debt service coverage toward that customer's local cash allocation of capital projects the following year. The City also bills Union Gap, and Terrace Heights separately for their share of applicable debt service payments. WHOLESALE STRONG WASTE: With the implementation of the 1997 Settlement Agreement, the cost of treatment of BOD and SS was combined with the cost attributed to the hydraulic flow in each month's billing. Each component is now weighted by the amount received from each customer. It is understood by all three parties that this slight modification to the past billing practice will enable each customer to pay a bill that more truly represents their overall impact to the facility. 2001 COS Section 9 Page 5 October 10, 2001 Table 9-1 Average Monthly Municipal Wholesale Billings Page 1 of 3 User Group 1998 1999 2000 2001 2002 2003 2004 2005 2008 Test Year City & County (Wholesale) $2,928,164 $3,179,993 32,864,536 $3,143,766 $3,394,025 33,471,486 33,573,499 33,678,685 33,787,150 Treatment Plant O&M RudkinRoadO&M 381,393 31,447,669 3979,566 372,775 31,439,687 3975,644 $90,557 31,442,274 3982,290 383,879 $1,403,037 3962,460 389,494 31,561,399 $943,045 392,065 31,834,636 $836,366 394,711 $1,838,806 3844,431 397,433 $2,113,869 3841,548 3100,234 32,111,233 $340,173 Treat. Plant Debt Serv. Treat. I'Iant Debt Cover. Rudkin Road Debt Serv. 35,539 35,283 $5,414 35,481 35,458 35,429 35,429 $6,245,411 35,540 35,540 $6,362,527 35,484 35,484 36,742,501 $5,491 35,491 $6,849,772 Rudkin Road Debt Cover. 35,539 35 283 $5,414 $5,390,485 $5,481 $5,604,104 35,458 $5,998,879 Approx. Annual Bill 35,447,870 35,678,665 ,4v Monthly Bill 3453,989 $473,222 3449,207 $467,009 3499,907 $520,451 3530,211 3561,875 3570,814 % change 4.24% -5 07% 3 96% 7.04% 4 11% 1.88% 5.97% 1.59% Terrace Heights Treatment Plant O&M 3108,476 3134,305 3102,243 $114,432 $125,989 3131,417 (313,142) 373,385 $33,455 $8,203 3137,953 (313,795) 373,552 333,777 38,613 3144,828 (314,483) 384,555;84,449 333,662 39,043 $152,048 (115,205) 333,607 39,496 3264,395 $22,033 2.64% Strong Waste effect (-10%) (310,848) 357,907 339,183 36,379 (313,431) $57,587 339,026 $6 715 (310,224) $57,691 339,292 $7,068 ($11,443) 356,121 338,498 37,440 (312,599) $62,456 $37,722 $7,812 Treat. Plant Debt Serv. Treat. Plant Debt Cover. Strong Waste Testing (3) Approx. Annual Bill 3201,097 316,758 3224,202 318,684 11.49% 3196,069 $16 339 -12 55% $205,049 $17,087 4.58% 3221,380 318,448 7.96% 3233,318 319,443 5.39% 3240,100 320,008 2.91% 3257,605 321,467 7.29% Av. Monthly Bill % change Union Gap Treatment Plant O&M 3142,938 321,441 321,741 $175,4E17 326,323 321,382 $138,719 320,808 324,909 $15,849 3116,824 379,565 $3,123 $3,123 312,654 3415,574 $34,631 -9.14% 3153,750 $23,062 322,848 317,609 3113,646 377,959 33,161 33,161 $13,320 $428,517 335,710 3.11% 3167,630 $25,145 324,140 $19,684 3126,473 376,387 33,148 33,148 313,986 $459,742__ 338,312 7.29% _ $173,156 325,973 324,593 320,895 3148,606 367,746 33,131 33,131 314,685 3481,917 340,160 4.82% 3180,006 327,001 325,054 322,305 3148,943 368,399 33,195 33,195 315,420 3493,518 341,127 2.41% 3187,137 328,071 325,523 323,812 3171,223 368,165 $3,163 33,163 316,191 3528,449 343,871 8.67% 3194,569 329,185 $26,003 325,423 3171,010 $68,054 $3,167 33,167 $17 000 3.37,579 $44,798 2.11% Strong Waste effect (+15%) RudkinRoadO&M Outside Flow @ 50% 314,987 320,438 Treat. Plant Debt Serv. 3117,261 3116,615 Treat. Plant Debt Cover. 379,345 379,027 Rudkin Road Debt Serv. 33,195 33,047 Rudkin Road Debt Cover. 33,195 311,420 3415,522 33,047 312 021 3457,387 $38,116 10.08% Strong Waste Testing Approx. Annual Bill l\v Monthly Bill 334,627 %change Page 1 of 3 10/8/01 Table 9-1 Average Monthly Municipal Wholesale Billings Page 2 of 3 User Grou. 1998 1999 2000 2001 2002 2003 2004 2005 2006 Test Year TREATMENT FACILITY City & County million gallons (1 3 581.47 3 302.21 -7 80% 3942.19 19.38% 3 976.45 0.87% 4,010 93 0.87% 4 045 60 0.86% 4 080.50 0.86% 4 115 59 0 86% 4 150.88 0.86% % change % of total 91 41% 90.26% 91 59% 91.47% 91.35% 91.23% 91.10% 90 98% 90.85% Terrace Heights million gallons (1) 145 14 154.52 153 63 158 24 162 99 167 88 172 91 178.10 183.44 % change 6 46% -0 58% 3 00% 3 00% 3 00% 3.00% 3 00% 3.00% % of total 3.70% 4.22% 3 57% 3.64% 3.71% 3 79% 3.86% 3.94% 4.01% Union Gap million gallons (1) 191.25 201.90 208.44 212 61 216 86 221.20 225.62 230.13 234.74 % change 5.57% 3.24% 2 00% 2.00% 2 00% 2.00% 2.00% 2.00% % of total 4 88% 5 52% 4 84% 4 89% 4.94% 4 99% 5 04% 5 09% 5 14% Total Plant Flow (1) 3 917 86 3,658 63 4,304.26 17 65% 41347 30 1 00% 4,390.78 1 00% 4 434 68 1 00% 4 479.03 1.00% 4 523 82 1.00% 4 569.06 1 00% % chan•e -6 62% EXPENSE _-11____x.: .IN4 $ ••r million_gals. $2,928 164 $747 $3 179 993 $869 $2,864,536 $3,143,766 $3 394 025 $3 471 486 $3 573 499 $3,678,685 $3 787 150 $666 $723 $773 $783 $798 $813 $829 SU 232 Debt Sery 4 $1 447 669 $1439 687 $1 442,274 $1 403 037 $1 561 399 $1,834 636 $1 838 806 $2 113 869 $2 111 233 SU 232 Debt Cover 4 $979,566 $975,644 $982,290 $962,460 $943,045 $836,366 $844,431 $841,546 $840,173 Union Ga. Outside Flow @ 50% -_ 34.81 41 92 40 38 42 40 44 52 46 74 49.08 51 54 54.11 %increase 20.43% -3 67% 5.00% 5.00% 5 00% 5.00% 5.00% 5.00% Page 2 of 3 10/8/01 Table 9-1 Average Monthly Municipal Wholesale Billings Page 3 of 3 User Group 1998 1999 2000 2001 2002 — 2003 2004 2005 2006 Test Year Rudkln Road R.R.FIow (1) 716.00 687 17 757.80 780 53 803 95 828.07 852.91 '878.50 904.85 % change -4 03% 10.28% 3.00% 3 00% 3 00% 3.00% 3.00% 3.00% % Yakima 73.29% 70.62% 72.49% 72.76% 73 03% 73.29% 73 55% 73.80% 74.06% % Union Gap 26.71% 29 38% 27 51% 27.24% 26.97% 26.71% 26 45% 26.20% 25 94% SU 215 Operating (5) $81,393 $72,775 $90557 $119 583,879 $107 $89,494 $111 $92,065 $111 $94,711 $111 $97,433 $111 $100234 $111 $ .=r million gals. $114 $106 SU 215 Debt Service (5) $5,539 $5,203 $5,414 $5,481 $5,458 $5,429 $5,540 $5,484 $5,491 SU 215 Debt Cover (5) $5,539 $5,283 $5,414 $5,481 $5,458 $5,429 $5,540 $5,484 $5 491 (1) Table 5-1 (3) See Table 9-5 Debt Seivice Allocation Plant Rudkin Rd. (4) See Table 9-2 Yakima 87.90% 42.32% (5) See Table 9-3 Union Gap 8.10% 57.68% Terrace Heights 4 00% 0.00% Page 3 of 3 10/8/01 Table 9-2 TREATMENT FACILITY (Service Unit 232) Expenses Description Final Final Final Estimate Estimate Estimate Estimate Estimate Estimate 1998 1999 2000 2001 2002 2003 2004 2005 2006 Budget Test Year . TREATMENT FACILITY SERVICE UNIT 232 OPERATIONS EXPENSES Total Operations 3,031,446 3,276,811 3,000,583 3,248,766 3,504,025 3,584,7.86 3,690,198 3,798,885 3,910,956 (Table 4-6) subtotal Operations 3,031,446 3,276,811 3,000,583 3,248,766 3,504,025 3,584,786 3,690,198 3,798,885 3,910,956 Less State taxes 103,282 96,818 136,047 105,000 110,000 113,300 116,699 120,200 123,806 Total Operations (Wholesale) 2,928,164 3,179,993 2,864,536 3,143,766 3,394,025 3,471,486 3,573,499 3,678,685 3,787,150 CAPITAL EXPENSES '78/96 Bond Redemption 292,973 291,671 293,582 279,877 294,739 293,151 299,182 296,124 296,488 '91 Bond Redemption 686,593 683,973 688,708 682,583 648,306 543,215 545,249 545,422 543,685 PWTF Proj. 1300 61,693 61,137 60,581 60,025 59,470 58,914 58,358 57,802 57,246 PWTF Proj. 1556 207,716 205,910 204,105 192,671 190,966 189,261 187,556 185,851 181,34-6- 184,146 179,712 PWTF Proj. 1638 198,694 196,996 195,298 187,881 186,247 184,613 182,979 Line of Credit (1.42mill) 181,671 181,671 181,671 181,671 181,671 Future Line of Credit (3.0mill) _ 383,811 383,811 383,811 383,811 Future PWTF (5 mill) 281,842 284,474 Subtotal Debt Service 1,447,669 1,439,687 1,442,274 1,403,037 1,561,399 1,834,636 1,838,806 2,113,869 2,11 1,233 Debt Coverage @ 2.0 979,566 975,644 982,290 962,460 943,045 836,366 844,431 841,546 840,173 Total Capital (Wholesale) _ 2,427,235 2,415,331 2,424,564 2,365,497 2,504,444 2,671,002 2,683,237 2,955,415 2,951,406 TOTAL SU 232 5,355,399 5,595,324 5,289,100 5,509,263 5,898,469_ 6,142,488 6,256,736 6,634,100 6,738,556 percent change 4.48% -5.47% 4.16% 7.06% 4.14% 1.86% 6.03% 1.57% 10/8/01 Table 9-3 RIJDKIN ROAD (Service Unit 215) Expenses Description Final Final Final Estimate Estimate Eobmare Estimate Estimate Estimate 1998 1999 2000 2001 2002 2003 2004 2005 ` 8006 Budget Test Year RUDKIN ROAD SERVICE UNIT 215 OPERATIONS EXPENSES Operations 81,393 72,775 90.567 83.879 8,949 92.065 94,711 97.433 100.234 see Table 4'5 Total Operations 81.383 72.775 90.557 83.87e 8,949 92.065 94.711 97'433 100,234 ^moont change -10.59% 24.43% -7.37% -89.33% 928.77% 2.87% 2.87p�-2.87% CAPITAL EXPENSES '78 Bond Redemption 5,539 5.283 5,414 5.481 5,458 5.429 5,540 5,484 5,491 Debt Coverage 92.O 5'539 5.283 5,414 5,481 5,458 5,429 5.5*0 11'080 5.484 10.968 5.491 10.982 Total Capital 11.078 10,566 10.828 10.e62 10.916 10.858 Total SU 215 92,471 83.341 101.385 94'841 19.855 102.923 105.781 108.40/ 111,216 2.60% percent change -9.87% 21.55% -6.45% '79.05% 418.11% 2.79% 2.47% 1V/8/01 SECTION 10 INDUSTRIAL WASTE CUSTOMERS Historically the City operated an Industrial Waste System that handled fruit processing waste from specific local industries. This collection and treatment system was separate from the system that collected and treated domestic and commercial wastewater. Beginning in 2000, the City brought the Industrial Waste flow into the domestic treatment facility for treatment. The Industrial Waste customers became "normal" industrial customers of the system. Therefore, this section of this report is no longer necessary. 2001 COS Section 10 Page 1 October 10, 2001 SECTION 11 CITY STRONG WASTE RETAIL CUSTOMERS Introduction: The "1976 Agreement" defines "normal" domestic wastewater as that which- contains concentrations of Biochemical Oxygen Demand (BOD) and Suspended Solids (SS) Tess than 300 parts per million (ppm). Discharges, which contain concentrations of these pollutants in excess of 300 ppm, are considered Strong Waste discharges and are subject to a surcharge. Although City rates are not bound by this definition, these concentration levels are currently being used as a threshold to determine City Retail Strong Waste customers For the 2001 season and into the future, Del Monte and possibly other future food processing industrial wastewater, which historically had been applied to the sprayfield for treatment, shall be introduced into the treatment facility. This change in our operations makes a significant seasonal increase in the total loading of BOD and SS. As presented in Section 2, Public Law 92-500, Section 204 (b) (1) (A) states that the costs of operation and maintenance of a sewerage system must be recovered from sewer service charges that are proportional to costs of providing service. Also, 40 CFR Chapter 35.835- 5 states that no grant may be awarded unless that applicant has an equitable system of cost recovery. "Such system shall provide for an equitable assessment of costs whereby such assessments upon dischargers of industrial wastes correspond to the cost of the waste treatment, taking into account the volume and strength of the industrial, domestic, and commercial wastes, and all other waste discharges treated...." The cost of service study is a part of the development of a wastewater service charge system, which bases charges for service, and capital costs, on the flow and strength characteristics of customers. Strength characteristics should include customer's BOD and SS levels, although additional strengths may also be included. In conjunction with implementation of the 1994 COS, the City's Pretreatment Program (refer to Section 6 of this report) has established individual strong waste categories that included most concentrations encountered. Each business was assigned to the most appropriate category based upon national data or results of the ongoing testing 2001 COS Section 11 Page 1 October 10, 2001 program of each business group; i.e. fast food, bakeries. Table 11-2 shows the concentrations of BOD and SS of each of the categories into which a business has been assigned. Several categories do not presently have any businesses assigned. A few extra categories were created which are unique to a specific business. Any individual customer within apy group may request that their effluent strength be tested and killing rate adjusted, Under this arrangement, this business will be sampled and tested. The results of these tests, be they higher or lower than the presumed concentration, will then be used to calculate their future billings. There is a fee for the individual sampling and testing as outlined in Section 6. Several businesses have successfully established that the concentrations of their discharge are lower than the presumed levels. The rates for these accounts have been adjusted accordingly. The City presently looks only at the concentration of BOD and SS when determining strong waste charges. Staff is reviewing the cost impact that ammonia and fats, oil, and grease (FOG) have on the system and anticipate proposing a minimum discharge concentration and a surcharge amount for ammonia and FOG in a future Cost of Service Report. Purpose of Cost of Service Study: The purposes of this cost of service study for owner (City) Strong Waste customers of the Retail System are to: • Allocate operating and capital costs of providing service to owner (City) retail Strong Waste customers. • Determine whether owner (City) retail Strong Waste customers receiving service from the City's wastewater system are paying fair and appropriate shares of costs of providing service. • Use the results of the retail cost of service study to establish rates and charges for owner (City) Strong Waste customers. Rate Policy Options: Prior to 1994 COS, City strong waste rates were set at a level that included only operations cost (capital cost were not included). During i�"I lr.nil rinlihnrn+inne. n‘i"r +1, -in, 1 QQA me c+off aloe nilien +he, direr•fiue +r1 VVU11V 11 UGIIVGI .LIVI1J VV I LII ) 1 V,/ VVV, JLul 1 ••u.a y1 •v11 •l lv u• vvto! •v •r 2001 COS Section 11 Page 2 October 10, 2001 phase out all cost sharing (subsidies) of user groups. Following this directive, the 1994 COS set City strong waste rates at a level half -way (50%) between "Operation Only" and "Full Cost to Treat". This rate level decreased the cost share but still maintained a 19% cost share of this user class from city retail customers. Continuing with the Council's directive of 1994, the 1996 COS report proposed the cost share be further reduced. The rates proposed were three-quarters (75%) between "Operation Only" and "Full Cost to Treat". The rates proposed still maintained an 11% cost share. However, Council chose to leave rates at the 1994 level. This increased the cost share to the general ratepayer This 2001 COS looks to establish rates at the Full Cost to Treat which will eliminate the cost share burden on the general retail rate payer, which is now 39.7%. Impact of Del Monte: During the 2000 season, wastewater from the City's only remaining food processing wastewater customer, Del Monte, was diverted from the sprayfield into the treatment facility. The capitol cost effect of this operational change is discussed in the 2000 Facilities Plan and in Section 4 of this report. The impact on this section is that Del Monte has become the City's largest Strong Waste customer, contributing approximately one-half of all billed Strong Waste for the year. This action also significantly increased the total pounds of BOD treated each year, which effectively lowered the unit cost of treatment for all strong waste customers from what it would have been without this change. The impact on SS volumes and rates is less significant. Cost of Service Procedure: The cost of service procedure, which will result in the appropriate allocations, requires that we formulate the following information about expenses to the system. For all rate calculations, staff used projected information for all years of the planning period; however, the included tables show detailed information for only the Test Year of 2002. 2001 COS Section 11 Page 3 October 10, 2001 1 Operation Expenses A. Treatment expenses and applicable allocation. B. Collection expenses and applicable allocation. 2) Capital expense A. Treatment Facility expenses and applicable allocation. B. Collection System expenses and applicable allocation. There currently is no element of the Strong Waste charge related to collection expenses. Therefore, 1B and 2B are $0.00. Organization of Cost of Service Tables - Owner Strong Waste Customers; In Section 8, this report classified and functionalized the treatment facility. Due to recent construction related to the Dei Monte project and the completed depreciation of some assets, plant allocation has shifted from SS to BOD treatment. This information will now be used to establish the cost of treatment of BOD and SS on a cash basis for use with City Retail Strong Waste Customers. Table 11-2A and 11-2B show the percentage adjustment for both BOD and SS for both OPTION A and OPTION B. BOD would increase by 27.4%, while SS would jump 99.3%. Individual businesses increases would vary between these two amounts depending on their constituent strengths. The overall net effect on all strong waste customers would be a 39.7% increase. Table 11-2A and 11-2B also indicate the projected revenue for each planning period receive from City RetniI year of the planning period the City would iw�irc it sat vny I wtctn Strong Waste with rates set at proposed level Table 11-3 calculates the revenue from City Retail Strong Waste for each year of the planning period with rates remaining at existing levels. This is provided for comparative purposes. Table 11-1 summarizes OPTION A and OPTION B and the projected revenue received under existing and proposed rates for each year. As proposed rates are set at "full cost", the projected revenue increase is equal to the cost share if rates remain unchanged. 2001 COS Section 11 Page 4 October 10, 2001 Review of Threshold Concentration: For this report and as currently used for determining rates, "Strong Waste" is defined as wastewater having BOD and SS concentrations in excess of 300 ppm. Section 6.14.3 of the 2000 Facilities Plan recommends the City lower this threshold to 260 ppm for BOD and 230 ppm for SS as "these values are more representative of the textbook description for "normal" domestic wastewater strength which is generally stated as 200 ppm BOD and 200 ppm TSS. Lowering the threshold for the definition of Strong Waste will provide an equitable assessment of costs to treat based on the actual volume and strength of the wastewater." Staff reviewed Yakima's actual BOD and SS data for the years 1998, 1999, and 2000. By using the total flow and load received at the facility and subtracting that from known sources (Strong Waste customers, Union Gap, and Terrace Heights), staff was able to determine the average load from all other sources. Those results are shown on Table 11-6 as BOD average 287 ppm, and SS average of 238 ppm. Additionally, in May of 2001, staff sampled over 25 locations throughout the City, which were believed to contain only "domestic" wastewater (residential neighborhoods). The results of this sampling, as indicated on Table 11-5, were BOD average of 275 ppm, and SS average of 318 ppm. A few of the locations had very high results. As staff is available, we will review these areas to determine the cause for this. It is the recommendation of this report that the threshold values remain at 300 BOD/300 SS. Conclusions: The existing rates charged for strong waste continue to contain a 39.7% (approximately $185,000 annually) subsidy from city retail customers. If Strong Waste Rates are not adjusted per the recommendations, city retail rates will need to be increased an additional 2% to offset the revenue loss to the division. The magnitude of the proposed rate increase is influenced by several factors: 1) Rates were not adjusted with the 1996 COS recommendations; 2) general inflation; 3) The classification of the facility shifted costs slightly from SS to BOD; 4) The increase was 2001 COS Section 11 Page 5 October 10, 2001 moderated somewhat because the projected loading of each constituent, BOD and SS, is considerably more than projected in the 1996 COS. This is due mainly to the inclusion of Del Monte's waste stream. EPA and good business management practices require that rates be set so that customers pay for their full impact to the system. Public. Law 92-500, Section 204 (b) (1) (A) states that the costs of operation and maintenance of a sewerage system must be recovered from sewer service charges that are proportional to costs of providing service. Section 3 of this report outlines upcoming Capital Projects. Nearly all of these projects are necessary because of the increasing loading of BOD and SS. Therefore, the continued subsidization of treatment costs of BOD and SS seems inappropriate. Rate Options: Staff reviewed two options to adjust rates to the Full Cost of Treatment. OPTION A: This option increases BOD and SS rates to average Full Cost of Treatment for the period 2001-2006 in one action. Existing: BOD = SS $ 0.230 per pound $ 0.150 per pound OPTION A: BOD = $ 0.293 per pound (2002) SS = $ 0.299 per pound OPTION Bz This option increases BOD rates to Full Cost of Treatment for the period 2001-2006 in one step. SS rates are increased in two phases; half in Phase 1, the remaining in Phase 2: Existing: BOD = $ 0.230 per pound SS = $ 0.150 per pound PHASE 1: /rInn7\ 2001 COS Section 11 Page 6 October 10, 2001 BOD = QS $ 0.293 per pound 0.225 per pound PHASE 2: BOD = $ 0.293 per pound (2003) SS = $ 0.299 per pound Recommendations; • It is the recommendation of this report that the Wastewater Division's Pretreatment Program continue to actively assist strong waste •11- •. • 1• • • / - - SI • Staff also recommends that, in compliance with past Council directives, the current "cost share" enjoyed by this user group be reduced if not eliminated • The proposed rate adjustment should be implemented in One Phase. Implement OPTION A. This increases BOD and SS rates to average Full Cost of Treatment for the period 2001-2006 in one single action. Existing: OPTION A: (2002) 2001 COS Section 11 Page 7 October 10, 2001 BOD = $ 0.230 per pound SS = $ 0.150 per pound BOD = $ 0.293 per pound SS = $ 0.299 per pound Table 11-1 City Retail Strong Waste Proposed Rate Adjustment Existing Cost Share Projected Annual Revenue 9/20/01 OPTION A ONETIME INCREASE BCD % SS Existing $0.230 increase $0.150 increase . Phase One $0.293 I 27.0% I $0.299 100.0% I Phase One Projected Projected Projected Projected Revenue Revenue Revenue % Revenue Existing Full Cost Increase Increase Rates Table 11-3 Table 11-2A 2001 $453,621 $453,621 $0 2002 $458,157 $640,138 $181,981 39.7% Phase One 2003 $462.739 $646.540 1 $183.801 39.7% 2004 $467,366 $653,005 $185,639 39.7% 2005 $472,040 $659,535 $187,495 39.7% 2006 $476,760 $666,130 $189,370 39.7% OPTION B PHASED INCREASE BCD % SS % Existing $0.230 increase $0.150 increase Phase One $0.293 27.4% $0.225 50.0% Phase One Phase Two $0.293 0.0% $0.299 32.9% Phase Two Projected Projected Projected Projected Revenue Revenue Revenue % Revenue Existing Full Cost Increase Increase Rates Table 11-3 Table 11-2B 2001 $453,621 $453,621 $0 2002 $458,157 $599,753 $141,596 30.9% Phase One 2003 $462,739 $646,540 $183,801 39.7% Phase Two 2004 $467,366 $653,005 $185,639 39.7% 2005 $472,040 $659,535 $187,495 39.7% 2006 $476,760 $666,130 $189,370 39.7% 9/20/01 Table 11-2A One Time FULL COST (300/300ppm) City Retail Strong Waste Customers Annual Revenue Page 1 of 2 Billing Consum•tion Pro'ected Billed Excess Excess $/Ib S.W ' . Billed Excess Excess $/Ib S.W. Total $ Total $ Cat:.ory U.O.C. Consum•tion BCC BOO lbs BOD excess charge SS SS lbs SS excess char.e SS Stron. Waste $8,586 816.457 : UOC _-- -_- $2.784 $0 439 -_ Last Year This Year PPM 300 >300. . m BOO BOD „JPPM) 300 m >300ppm SS SS 80.150 Table 5-2 $1,974 CITY RETAIL STRONG WASTE-�--- 2001 S8AL increase 3,054 1.00% 3.085 _- 1,794 1,494 BOO 80.230 28,747 $0.230 $6,612 : 984 684 13,161 $0 150 SBCL 37 156 37 528 485 185 43 308 $0.230 $9 961 485 185 43,308 $0 150 $6,496 Del Monte 0 31 083 1,270 4 744 1,405 4 444 1,105 861 673 8,751 $0.230 $0.230 $198 185_ 647 347 67 282 $0.150 $10,092 $208 277 $3,992 $6.701 $3.144 $0.849 -� SBKC 1,257 $2,013 : 1,966 1,666 13,194 $0.150 $1,979 S8PH 13,893 14,032 568 268 23,458 $0 230 $5,395 : 796 496 43,415 $0 150 $6,512 $11,908 S8RA 0 3 900 3 100 2 800 68 119 $0.230 $15 667 500 200 4 866 $0.150 $730 $16 397 $7,763 $4.204 $5.681 -_ S8SF 1,353 1,367 4,225 3,925 33,458 $0.230 $7,695 353 53 452 $0.150 $68 S8YB 1.753 1,771 3,322 3,022 33,377 $0.230 $7,677 496 196 2,165 $0 150 $325 88,001 $4.519 S802 4 062 4 103 400 100 2 559 $0.230 $589 : 400 100 2 559 $0.150 $384 8973 $0.237 S806 341 344 600 300 645 $0 230 $148 600 300 645 $0 150 $97 $245 $0.711 -_ S818 133 134 1,200 900 754 $0 230 $173 . 1,200 900 754 $0 150 $113 8287 82.133 S820 39 174 39 566 500 200 49 362 $0.230 $11 353 : 300 0 0 $0.150 80 $11,353 $0.287 S822 44 867 45 316 700 400 113 072 $0.230 $26 006 300 0 0 $0.150 80 $26 006 $0.574 S824 2,823 2,851 900 600 10,672 $0.230 $2,454 300 0 0 $0.150 $0 82,454 $0.861 S836 70,694 71,401 1,100 800 356,319 $0 230 $81,953 900 600 267,239 $0.150 $40,086 8122,039 $1 709 S838 46,993 47,463 300 0 0 $0.230 $0;;; 500 200 59,215 $0.150 $8882 $8,1182 $0.187 subtotal 267,553 305,212 1,634,273 $375,883 ,.,: 518,255 $77,738 $453,621 ---�- -- increase PHASE ONE 2002 S8AL -- increase 3 085 1.00% 3 115 1 794 _- - 1 494 BOO 29 034 80.293 $0.293 % increase -- 684 M 13,293 $0.299 80.299 1 increase 100.0% $3.975 -_ -_-� 812,481 54.006 this Phase 43.9% 27.0% $8 507 : 984 S8CL 37 528 37 903 485 185 43 741 $0.293 $12 816 : 485 185 43 741 $0.299 813 079 25 895 80.683 55.8% DelMonte 31,083 31,394 4,744 4,444 870,289 $0 293 $254,995 : 647 347 67,955 80.299 820,318 8275,313 88.770 30.9% SBKC 1,270 1.282 1,405 1,105 8,839 80.293 $2,590 : 1,966 1,666 13,326 80.299 $3,984 86,574 85.127 63.1% S8PH 14 032 14 172 568 268 23 693 $0.293 $6 942 : 796 496 43 850 $0.299 20 053 66.7% S8RA 3,900 3,939 3,100 2,800 68,800 $0.293 820,158 500 200 4.914 80.299 81 469 821,628 55.491 30.6% S8SF 1,367 1,380 4,225 3,925 33,793 $0.293 $9,901 . 353 53 456 $0.299 $136 810,038 $7.273 28.0% S8YB 1 771 1 788 3 322 3 022 33 710 $0.293 $9 877 : 496 196 2 186 $0.299 $654 $10 531 5.889 30.3% S802 4,103 4,144 400 100 2,585 $0.293 $757 : 400 100 2.585 80.299 8773 $1,530 80.369 55.8% S806 344 348 600 300 651 $0 293 $191 : 600 300 651 $0.299 $195 8385 81.108 55.8% S818 134 136 1 200 900 762 $0.293 $223 : 1,200 900 762 80.299 8228 8451 83.324 55.8% S820 39 566 39 961 500 200 49 856 80.293 814 608 : 300 0 0 80.299 0 814 608 0.366 27.4% S822 45,316 45,769 700 400 114,202 $0.293 $33,461 : 300 0 0 80.299 80 833,461 $0.731 27.4% S824 2,851 2.880 900 600 10,778 80 293 53,158 : 300 0 0 80.299 80 83,158 81 097 27.4% S836 71 401 72 115 1 100 800 359 882 80.293 8105 446 . 900 600 269 912 80.299 80 704 186 149 E; 51.0% S838 47,463 47,938 300 0 0 80.293 50 ;•..: 500 200 59,807 80.299 $17,882 817,882 $0.373 99.3% subtotal 305,212 308 264 1,650,616 8483,631 ': 523,437 8156,508 $640,138 39.7% 9/20/01 Page 1 of 2 Table 11-2A One Time FULL COST (300/300ppm) City Retail Strong Waste Customers Annual Revenue Page 2 of 2 Billing Consumption Projected Billed Excess Excess $/Ib excess S.W. charge ". Billed SS Excess SS 300 ppm Excess lbs SS >300ppm $/Ib excess SS S.W. charge lE Total $ _ Strong Waste Total $ per UOC Category U.O.C. Consumption BOO BOD lbs BOD Last Year This Year (PPM) 300 >300ppm BOD BOO : (PPM) Table 5-2 ppm . CITY RETAIL STRONG WASTE PHASE TWO % increase . % increase % % BOD $0.293 0.0% . SS $0.299 0.0% increase combined 2003 increase 1.00% combined 27.4% combined 99.3% this Phase increase S8AL 3,115 3,147 1,794 1,494 29,324 $0.293 $8,592 : 984 684 13426 $0.299 84,014 $12,606 $26,154 $4.006 80.683 0.0% 0.0% 43.9% 55.8% S8CL 37,903 38,282 485 185 44,178 $0.293 $12,944 . 485 185 44,178 $0.299 $'13,209 Del Monte 31,394 31,708 4,744 4,444 878,992 $0 293 $257,545 . 647 347 68,634 $0.299 $20,522 $278,066 $8.770 0.0% 30.9% S8KC 1,282 1,295 1,405 1,105 8,927 $0.293 $2,616 • 1 966 1,666 13,459 $0.299 $4,024 $6,640 $20,254 $5.127 $1.415 0.0% 0.0% 63.1% 66.7% SBPH 14,172 14,314 568 268 23,930 $0 293 $7,011 796 496 44,288 $0.299 $13,242 SERA 3,939 3,978 3,100 2,800 69,488 $0.293 $20,360 . 500 200 4,963 $0.299 $1,484 $21,844 85.491 0.0% 30.6% S8SF 1,380 1,394 4,225 3,925 34,131 $0.293 $10,000 • 353 53 4151 $0.299 $138 $10 138 $10,636 $7.273 $5.889 0.0% 0.0% 28.0% 30.3% SBYB 1,788 1,806 3,322 3,022 34,048 $0.293 $9,976 . 496 196 2,208 $0.299 $660 S802 4,144 4,185 400 100 2,611 $0 293 $765 . 400 100 2,611 80.299 8781 $1,546 80.369 0.0% 55.8% S806 348 351 600 300 657 $0.293 $193 ' . 600 300 657 $0.299 $197 8389 81.108 0.0% 55.8% S818 136 137 1,200 900 769 80.293 $225 • 1,200 900 769 $0.299 $230 8455 $3.324 0.0% 55.8% S820 39,961 40,361 500 200 50,354 $0.293 $14,754 . 300 0 0 80.299 $0 $14,754 80.366 0.0% , 27.4% S822 45,769 46,227 700 400 115,344 $0.293 $33,796 " : 300 0 0 $0.299 $0 $33,796 80.731 0.0% 27.4% S824 2,880 2,909 900 600 10,886 80.293 $3,190 300 0 0 $0.299 $0 $3,190 $1.097 0.0% 27.4% S836 72,115 72,836 1,100 800 363,481 $0 293 $106,500 : 900 600 272,611 $0.299 $81,511 8188,011 $2.581 0.0% 51.0% S838 47 938 48 417 300 0 0 $0.293 S0 • .::. 500 200 60405 528 672 $0.299 118 061 1158 073 18 061 646 540 $0.373 0.0% 0.0% 99.3% 39.7% subtotal 308 264 311,346 1 667 122' $48_8,467 2004 increase 1.00% subtotal 311,346 314,460 1,683,7921 $493,351 ` 533,958 $159,654 8653,005 2005 increase 1.00% • _ subtotal 314,460 317,604 1,700,631 $498,285 539,298 $161,250 $659,535 2006 increase 1.00% • subtotal 317,604 320,780 1,717,638 $503,268 "-: 544,691 $162 863 8666,130 9/20/01 Page 2 of 2 Table 11-2B PHASED FULL COST (300/300ppm) City Retail Strong Waste Customers Annual Revenue Page 1 of 2 Billing Consumption Projected Billed Excess Excess $/lb S.W. . Billed Excess Excess $/ib S.W. Total $ Total $ Category U.O.C. Consumption BCD BOD lbs BOD excess BOD charge : SS SS lbs SS excess charge Strong per UOC Last Year This Year (PPM) 300 >300ppm BOD : (PPM) 300 >300ppm SS SS Waste Table 5-2 ppmppm CITY RETAIL STRONG WASTE 2001 increase 1 00% B00 $0.230 SS $0.150 S8AL 3,054 3,085 1,794 1,494 28,747 $0.230 $6,612 . 984 684 13,161 $0.150 $1,974 $8,586 $2.784 S8CL 37,156 37,528 485 185 43,308 $0.230 $9 961 : 485 185 43,308 $0.150 $6,496 $16,457 $0.439 Del Monte 0 31,083 4,744 4,444 861,673 $0.230 $198,185 : 647 347 67,282 $0.150 $0.150 $10,092 $1,979 $208,277 $3,992 $6.701 $3.144 S8KC 1,257 1,270 1,405 1,105 8,751 $0.230 $2,013 . 1,966 1,666 13,194 S8FH 13,893 14,032 568 268 23,458 $0 230 $5,395 : 796 496 43,415 $0.150 $6,512 $11,908 $0.849 SERA 0 3,900 3,100 2,800 68,119 $0.230 $15,667 : 500 200 4,866 $0.150 $730 $16,397 $4.204 S8SF 1,353 1,367 4,225 3,925 33,458 $0.230 $7,695 . 353 53 452 $0 150 $68 $7,763 $5.681 SBYB 1,753 1,771 3,322 3,022 33,377 $0 230 $7,677 : 496 196 2.165 $0.150 $325 $8,001 $4.519 S802 4,062 341 4,103 344 400 600 100 300 2,559 645 $0.230 $0.230 $589 400 100 2,559 $0.150 $384 $973 $0.237 S806 $148 600 300 645 $0.150 $97 $245 $0 711 S818 133 134 1,200 900 754 $0.230 $173 1,200 900 754 $0 150 $113 $287 $2.133 S820 39,174 39,566 500 200 49,362 $0.230 $11,353 : 300 0 0 $0.150 $0 $11,353 $0.287 S822 44,867 45,316 700 400 113,072 $0.230 $26,006 : 300 0 0 $0.150 $0 $26,006 $0.574 S824 2,823 2,851 900 600 10,672 $0.230 $2,454 . 300 0 0 $0.150 $0 $2,454 $0.861 S836 70,694 71,401 1,100 800 356,319 $0.230 $81,953 900 600 267,239 $0.150 $40,086 $122,039 $1.709 S838 46 993 47,463 300 0 0 $0.230 $0 •: 500 200 59,215 $0.150 $8,882 $8,882 $0.187 subtotal 267,553 305,212 1,634,273 $375,883 `"..: 518,255 $77,738 $453,621 increase PHASE ONE % increase % increase this Phase 2002 increase 1.00% BOO $0.292 27.0% SS $0.225 50.0% S8AL 3,085 3,115 1,794 1,494 29,034 $0.292 $8,478 984 684 13,293 $0.225 $2,991 $11,469 $3.681 32.3% S8CL 37,528 37,903 485 185 43,741 $0.292 $12,772 485 185 43,741 $0.225 $9,842 $22,614 $0.597 36.1% Del Monte 31.083 31,394 4,744 4,444 870,289 $0 292 $254.125 647 347 67,955 $0.225 $15,290 $269,414 $8.582 28.1% S8KC 1,270 1,282 1,405 1.105 8,839 $0.292 $2,581 1,966 1,666 13,326 $0.225 $2,998 $5,579 $4.351 38.4% SBPH 14,032 14,172 568 268 23,693 $0.292 $6,918 : 796 496 43,850 $0.225 $9,866 $16,785 $1.184 39.6% SERA 3,900 3,939 3,100 2,800 68,800 $0.292 $20,090 : 500 200 4,914 $0.225 $1,106 $21,195 $5.381 28.0% S8SF 1,367 1,380 4,225 3,925 33,793 $0.292 $9,868 .. 353 53 456 $0.225 $103 $9,970 $7.224 27.2% SBYB 1,771 1,788 3,322 3,022 33,710 $0.292 $9,843 ' . 496 196 2,186 $0.225 $492 $10,335 $5.780 27.9% S802 4,103 4,144 400 100 2,585 $0 292 $755 ; 400 100 2,585 $0.225 $582 $1,336 $0.323 36.1% S806 344 348 600 300 651 $0.292 5190 . 600 300 651 $0.225 $146 $337 $0.968 36.1% S818 134 136 1,200 900 762 $0.292 $222 : 1,200 900 762 $0.225 $171 $394 $2.903 36.1% S820 39,566 39,961 500 200 49,856 $0.292 $14,558 : 300 0 0 $0.225 $0 $14,558 $0.364 27.0% S822 45,316 45,769 700 400 114,202 $0.292 $33,347 ,. : 300 0 0 $0.225 $0 $33,347 $0.729 27.0% S824 2,851 2,880 900 600 10,778 $0 292 $3,147 : '. 300 0 0 $0.225 $0 $3,147 $1.093 27.0% S836 71,401 72,115 1,100 800 359,_882 $0.292 $105,086 . 900 600 269,912 $0.225 $60,730 $165,816 $2.299 34.5% S838 47,463 47,938 300 0 0 $0.292 $0 ;.j 500 200 59,807 $0.225 S13,457 $13,457 $0.281 50.0% subtotal 305,212 308,264 1,650,616 $481,980 ". 523,437 $117,773 $599,753 30.9% 9/20/01 Page 1 of 2 'Table 11-2B PHASED ROLL COST (300/300ppm) City Retail Strong Waste Customers Annual Revenue Page 2 of 2 Billing Consumption Projected Billed Excess Excess $/Ib S.W. . Billed Excess Excess $/ib SW. Total $ Total $ Category U.O.C. Consumption BOD BOO lbs BOD excess BOD charge : SS SS lbs SS excess 86 charge SS Strong , Waste per UOC Last Year This Year Table 5-2 (PPM) 300 ppm >300ppm BOD : (PPM) 300 >1300ppm ppm CITY RETAIL STRONG WASTE PHASE TWO % increase % Increase % 9'4 BOO $0.293 0.0% . SS 30.299 32.9% increase combined 2003 increase 1.00% combined 27.4% combined 99.3% this Phase increase S8AL 3,115 3,147 1,794 1,494 29,324 $0.293 $8592 : 984 684 13,426 $0.299 $4,014 $12,606 34.006 8.8% 43.9% S8CL 37,903 38,282 485 185 44,178 $0.293 $12,944 . 485 185 44,178 $0.299 513,209 $26,154 $0.683 14.5% 55.8;/. Del Monte 31,394 31,708 4,744 4,444 878,992 $0.293 $257,545 : 647 347 68,634 $0.299 $20,522 $278,066 $8.770 2.2% 30.9% SBKC 1,282 1,295 1,405 1,105 8,927' $0.293 $2,616 : 1,966 1,666 13459 $0.299 54,024 $6,640 35.127 17.8% 63.1% SSPH 14,172 14,314 568 268 23.930 $0.293 $7,011 . 796 496 44,288 $0.299 513,242 $20,254 $1.415 19.5% 66.7% S8RA 3,939 3,978 3,100 2,800 69,488 $0.293 $20,360 : 500 200 4,963 30.299 51,484 $21,844 55.491 2.0% 30.6% SSSF 1,380 1,394 4,225 3,925 34,131 $0.293 $10,000 . 353 53 461 $0.299 $138 $10,138 $7.273 0.7% 28.0% SBYB 1,788 1,806 3,322 3,022 34,0481 $0.293 39,976 . 496 196 2,208 $0.299 $660 510,638 35.889 1.9% 30.3% S802 4,144 4,185 400 100 2,611 $0.293 5785 . 400 100 2,611 $0.299 5781 $1,546 50.369 14.5% 55.8% S806 348 351 600 300 657 $0.293 5193 600 300 657 $0.299 $197 $389 $1.108 14.5% 55.8% S818 136 137 1,200 900 769 $0.293 $225 1,200 900 769 $0.299 5230 $455 $3.324 14.5% 55.8% S820 39,961 40,361 500 200 50,354 $0.293 $14,754 . 300 0 0 $0.299 $0 514,754 333,796 $0.366 $0.731 0.3% 0.3% 27.4% 27.4% S822 45,769 46,227 700 400 115,344 $0.293 $33,796 : 300 0 0 30.299 50 S824 2,880 2,909 900 600 10,886 50.293 $3,190 300 0 0 30.299 50 $3,190 3188.011 $1.097 32.581 0.3% 12.3% 27.4% 51.0% S836 72,115 72,836 1,100 800 363,481 $0.293 $106,500 : 900 600 272,611 $0.299 $81,511 S838 47,938 48,417 300 0 0 $0.293 $0 ::. 500 200 60 405 $0.299 318,061 $18,061 $0.373 32.9% 99.3% subtotal 308,264 311,346 1,667,122 $488 4157 .:.. 528672 $158,073 $646,540 6.7% 39.7% 2004 increase 1.00% subtotal 311,346 314,460 1,683,793 $493351 533,958 $159,654 $653,005 2005 increase 1.00% • subtotal 314,460 317,604 1,700,631 $498,285 539,298 $161,250 $659,535 2006 increase 1.00% subtotal 317,604 320,780 1,717,638 $503,268 ,: 544,691 $162,863 $666,130 9/20/01 Page 2 of 2 Table 11-3 EXISTING RATES City Retail Strong Waste Customers Annual Revenue Bur . Consum.tion Pro ected Billed Excess Excess $/Ib S.W. . ' Billed Excess Excess $/1b S.W. Total $ Cat :. o U.O.C. Consum • tion BOD BOD los BOD excess char. a SS SS lbs SS excess charge Strong CI Retail 2000 --_ 2001 PPM 300 y. m >300••m -- 80D BOD ' (PPM) 300 >300ppm SS SS Waste ppm Stron' Waste --__ BOD 80.230 SS $0.150 Increase 1.00% _--- S8AL 3,054 3,085 1,794 1,494 28,747 $0.230 $6,612:•'`':' 984 684 13,161 $0.150 $1,974 $8,586 SBCL 37,156 37,528 485 185 43,308 $0.230 $9,961 `.'::: 485 185 43,308 $0.150 $6,496 $16,457 S8Dei Monte 31,083 4,744 4,444 861,673 $0.230 $198,185 '':.:; TABLE 11-4 Full Cost of Treatment CASH BASIS City Retail Allocation of Treatment Facility Expenses (SU 232) Unit Cost BOD, SS Service Descri•tion Pro'ected Cost Component Factor SS (%) Septage Cost Com••nent $ Unit Ex • nse Flow BOD Flow BOD SS Septage 2002 (see Table 8-4) 49 73% 31.58% 0.42% 18 27% 232 Operations (1) 3,504,025 • 640,185 1,742,552 1,106,571 14,717 232 Debt Service (1) 2 2213 798 404,461 1 100 922 699,117 9 298 232 Utili Tax • 14% 800,495 146,250 398,086 252,796 3,362 Total 6,518,318 1,190,897 3,241,560 2,058,485 27,377 Biochemical BOD Oxygen Demand Cost Total lbs. $3,241,560 10,573,271 = (2) $0.307 per pound treated 1 See Table 4-6 (2) See Table 5-6 _ Suspended Solids Cost $2,058,485 = $0.296 per pound treated SS Total lbs 6 953,928 (2) _ BOD SS Existing Rates $0.230 $0.150 Full Cost per 1996 COS $0.374 $0 371 Calculation for the Year BOD increase SS increase 2001 $0.31 1 35 2% $0 288 92 0% 2002 $0 307 33 5% $0 296 97.3% 2003 $0.279 21 3% $0.281 87.3% 2004 $0 288 25.2% $0.301 100 7% 2005 $0.292 27 0% $0.315 110.0% 2006 $0.283 23.0% $0.315 110.0% avera,a 01-06 $0.293 27.5% $0.299 99.6% i 10/8/01 SECTION 12 CITY RETAIL CUSTOMERS Introduction: • Section 2 of this report established that a CASH BASIS would be utilized to set rates for City Retail Customers. The cash basis of accounting determines requirements of a utility on the basis of cash receipts and cash outlays as they fall due. Cost of Service Procedure: meet the system's monetary demands Expected revenue from each other user group is calculated based upon projected flow and proposed rates. The total of this revenue is subtracted from total system monetary requirements. The remaining revenue requirement is then allocated to City retail Customers. The proposed charges are based on the following elements for each year of the planning period: 1) Annual Revenue Requirement. 2) Number of Meter Equivalent Accounts. 3) Total Billed Flow. Projected System Expenses: Operations and Maintenance Expenses• • In Section 4 of this report, total operating expenses for all wastewater activities were projected for the planning period. The budget presented is that required to fulfill the requirements outlined in the Mandated 2000 Facilities Plan. Table 4-2B shows that for the Test Year 2002 O&M expenses total $6,652,748. Transfers, Capital Expenses• • In Section 3, mandated future Treatment Facility Capital Projects (Fund 478) were examined. This section explained that due to increasing mandates of our NPDES Permit, increasing plant loads, and facility 2001 COS Section 12 Page 1 October 10, 2001 rehabilitation, major Capital Projects are required within the planning period. To assist financing these projects, a $200,000 transfer from Fund 473 into Fund 478 is budgeted for each year throughout the planning period. • Section 3 also identifies several upcoming mandated Collection System Capital Projects (Fund 476). To assist financing these projects, a $500,000 transfer ransiel iS budgeted idyeaed ea0b year from Fund 473 throughout the remainder of the planning period. • Section 3 also listed minor capital projects or major repairs (Fund 472). To assist financing these projects, a $131,850 transfer from Fund 473 is budgeted throughout the remainder of the planning period. Debt Service and Debt Service Coverage• • Capital transfers were established to be equal to the Debt Service Coverage cver3ge FaGIU_ of 2.0 on outstanding Revenue Bonds and State Revolving Fund Loans when added to the existing Debt Service obligations; the resultant total Capita! expense projected for 2002 is shown of Table 4-2B as $3,180,753. Utility Tax• • This Tax is revenue neutral for the Wastewater Division. Each month funds are transferred to the City's general fund based upon amounts billed. Wastewater is not refunded if any bills are not paid. This tax has been included in calculating rates for all customer groups in previous sections. City utility is currently c®t at 14% nn Wastewater gross income_ The VIL' utility L' tax /J currently vvt •A• v..Wastewater ........ �•��� •••�---- Presently wholesale municipal and revenues collected for Debt Service Coverage are not subject to this tax. Table 12-4 shows this amount for 2002 as $1,116,948. Table 12-4 shows the 2002 projected Total Revenue Requirements of the Wastewater Division as $10,950,449, Projected Revenue from ALL User Groups except City Retail: In prior sections of this report, projected revenue from each user group (with the exception of City Retail) was calculated using projected flows • mei nrninn cerl QI14 '.,1 VF.rV JL.iV 1 LA LVJ. 2001 COS Section 12 Page 2 October 10, 2001 Those user groups included: 1) Pretreatment customers (testing and permit fees) 2) Non -owner Retail Customers A) County Retail Customers B) County Retail Strong Waste Customers C) Septage Customers 3) Wholesale Municipal Customers A) The City of Union Gap B) Union Gap Share of Local Cash (debt coverage) D Terrace Heights Sewer District E) Terrace Heights Share Local Cash (debt coverage) 4) City Strong Waste Customers Two of these groups (Pretreatment Customers and City Strong Waste Customers) are currently receiving a subsidy from City Retail Customers. The general City Council policy direction during adoption of the 1994 COS was to phase out these subsidies. This report continues toward that goal. In addition to the above customers, the Wastewater Division also receives income from the following sources: Interest Income The Wastewater Division earns interest on the cash balance that it maintains in each of its four Funds. The projected interest income for 2002 is listed on Tables 3-1 through 3-3 and 4-1B. This income is credited to the Fund upon which it is earned. Wastewater Connection Charge (WCC). This fee is assessed against new customers connecting to the wastewater system and helps offset the investment made by others to provide the system to which they connect. Revenue from this source is budgeted at $317,100 for 2002. This income is split between the 476 and 478 Funds. Del Monte Contribution Per an agreement about connection fees and capital improvements, Del Monte will contribute $75,200 into the Wastewater fund each year for 20 years. 2001 COS Section 12 Page 3 October 10, 2001 All projected revenue from the above-mentioned sources is detailed on Table 12-4. For 2002. the Total Revenue nroiected from other sources at proposed rates equals 52,329,029. Required Revenue City Retail: Under a CASH BASIS, the City Retail Customers must generate the additional revenue required to insure the facility maintains an adequate cash flow. City Retail Customers consist of "normal" strength customers. Table 12-4 show the revenue required for each year of the planning period from this user group to balance expenses. For the test year of 2002, the City Retail Customers have a For 2002, the Total annual revenue requirement is 58,621,420. Rate Study City "Normal" Strength Retail Customers: This report now establishes rates using a CASH BASIS for "normal" De-.+.-. i� 1 1 e.+. -s wrote+ J LI GI Iy LII Aa 19, 1 IGLalI VU.7L4../11 IG1. This report looks at the following, all projected, for the test year 2002 for this user group: 1) Remaining Revenue Requirements 2) Total Billed Flow 3) Number of Meter Equivalent Accounts 1) The Remaining Annual Revenue Requirements for City retail customers are shown of Table 12-4. 2001 COS Section 12 Page 4 October 10, 2001 2) Total Billed Flow: Table 5-1 of this report projected flows for the various user groups. The 2002 projected billed flow for City Retail was shown as 3,494,674 Units of Consumption (UOC). 3) Number of Meter Equivalent Accounts. The 2002 projected meter equivalents for City Retail are shown on Table 5-9 to be 23,565. Revenues from Existing Rates: Table 12-3 calculated revenues for each year of the planning period using projected flows, number of meter equivalents, and EXISTING RATES. The results are summarized on Table 12-1 and compared with the revenue requirements brought forward from Tables 12-4. Table 12-1 indicates that in - - - - short of requirements by $130,396 (1.9°/4. In 2002, there would be an additional shortfall of $1,058,798 (14M%). Table 12-1 also displays that for each year of the remainder of the planning period revenues from existing rates will fall significantly behind revenue requirements. I1 - 1 - .11 1 . Rate Options: Resolution R-2000-66, dated June 6th, 2000, directed staff to prepare an ordinance to impose a 2% rate increase applied only to the Ready -to - Serve element of the City Retail Wastewater Rates. Revenue generated was to pay debt service on a $1.5 million PWTF loan for Phase I of the Fruitvale Neighborhood Sewer -Water Project. The City has received this loan. The top of Table 12-1 of this Report demonstrates that the existing monthly Ready -to -Serve charge and volume rates are not adequate to yield the revenue required by 2002 and in following years. The annual shortfall reaches $2,803,569 (36.59%) by 2006. Staff prepared for your review Three Options to adjust rates to meet the revenue requirements of the division. Revenue received due to the 2% increase for the PWTF loan is included in the calculations for each of the following Options. Remember that the Facilities Plan documents the need for an additional capital program of $44.9 million during the period 2006-2012. 2001 COS Section 12 Page 5 October 10, 2001 Option A: (One time increase) a one-time increase of 35% applied to both the Ready -to -Serve charge and the Volume Charge (See Table 12- 2A and 12-1). Option A would establish rates necessary to generate the revenue requirement in 2006. This Option would also, during the 5 year period, generate $4,242,311 in addition to the needs indicated. Option B: (Three even steps) Three successive annual increases of 10.5% for the first three years applied to both the Ready -to -Serve charge and the Volume Charge (See Table 12-2B and 12-1). Option B would establish rates necessary to generate the revenue requirement in 2006. This Option would also, during the 5 year period, generate $1,406,343 in addition to the needs indicated. Option C: (Half the required increase in 2002; then four even steps. OPTION C would contain an increase each year: 17.5% in 2002, followed by a 3.5% increase in 2003, 2004, and 2005, and 2006. All increases i li to the Ready -to -Serve Serve chn ge and the Volume would be applied both the nGaur-w- �� v� �.� iary� and the • v�u� �.v Charge (See Table 12-2C and 12-1). This Option would establish rates necessary to generate the revenue requirement in 2006. This Option would, during the 5 -year period, gain $803,286 in addition to the needs indicated. 2001 COS Section 12 Page 6 October 10, 2001 Recommendation; It is the recommendation of this report that Option A is adopted and that rates are adjusted to the level required to provide adequate system revenue: • Implementation of the Required Rate Increase in One Phase (See Table 12-2A) Existing Rate: Ready -to -Serve = $ 8.33 per meter equivalent Volume = $ 1.49 per UOC • 2001 PWTF. Increases Ready -to -Serve rates 2.0% Per Resolution R-2000-66 PWTF: Ready -to -Serve = $8.50/equiv. Volume = $1.49/UOC 2002 OPTION A Increases rates 35.0% Phase One: Ready -to -Serve = $11.48/equiv. Volume = $2.01/UOC The above rate increases will only bring rates current with the 2006 revenue requirements. Projections indicate that continuing annual increases of 2-3% will be required. Adoption of this OPTION will provide some reserves as we go onto the $44.9 million capital program of the next 6 -year period. 2001 COS Section 12 Page 7 October 10, 2001 Table 12-1 City Wastewater Retail Customer Projected Revenue/Requirement 10/8/01 Projected Projected Revenue % % x Revenue Requirement Shortfall Shortfall Increase CURRENT RATES Monthly I State Table 12-3 Table 12-4 Rata Ranking Year Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 ($130,3961. -1.88% $23.23 127 E20-02 $7,562,622 88,621 ,420 ($1,058,798) -14.00% 2003 $7,587,434 $8,606,315 ($1,018,881) -13.43% 2004 $7,612,280 $9,521,340 ($1,909,060) -25.08% 2005 $7,637,257 $10,276,870 ($2,639,613) -34.56% 2006 $7.662,269 $10,468,209 ($2,805,940) -36.62% 2002-2006 ($9,432,292) OPTION A PROPOSED RATES (All Options include the 2% increase for the PWTF loan) One Time 35% Monthly State Table 12-2A Table 12-4 Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 ($130,396) -1.88% $23.23 127 2002 $10,270,609 $8,621,420 $1,649,189 16.06% 35.00% $31.58 58 2003 $10,304,424 $8,606,315 $1,698,109 16 48% $31.58 58 2004 $10,338,285 $9,521,340 $816,945 7.90% $31.58 58 2005 $10,372,327 $10,276,870 $95,457 0.92% $31.58 58 2006 $10,406,414 $10,468,209 1 ($61,795) -0.59% $31.58 58 2002-2006 $4,197,905 leffective increase 35.9% OPTION 9 PROPOSED RATES (All Options include the 2% increase for the PWTF loan) 3 even Steps of 10.5% Monthly State Table 12-2C Table 12-4 Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 ($130,396) -1.88% $23.23 127 2002 $8.421.516 88.621 .420 ($199,904) -2.37% 10.50% 1 $25.89 106 2003 $9,326,161 $8,606,315 $719,846 7.72% 10.50% $28.58 85 2004 $10,335.429 $9,521,340 $814,089 7.88% 10.50% $31.57 58 2005 $10,369,456 $10,276,870 $92,586 0.89% $31.57 58 2006 $10,403,529 $10,468,209 ($64,680) -0.62% $31.57 58 2002-2006 I $1,361,937 effective increase 35.9% OPTION C PROPOSED RATES (Al options mciuoe the 2% increase for the PWTF loan) 1 Step of 17.5% then 4 of 3.5% Monthly State Table 12-2C Table 12-4 I Rate Ranking Projected Revenue Requirement 10 UOC of 201 2001 $6,935,627 $7,066,023 ($130,396) -1.88% $23.23 127 2002 $8,940,652 $8,621,420 $319,232 3.57% 17 50% $27 49 93 2003 $9,279,759 $8,606,315 1 $673,444 7.26% 3.50% $28.44 87 2004 $9,623,804 $9,521,340 $102,464 1.06% 3.50% $29.40 79 2005 $10,008,174 $10,276,870 ($268,696) -2.68% 3.50% 830 47 70 2006 $10,400,645 $10,468,209 I ($67,564) -0.65% 3.50% $31.56 58 2002-2006 I $758,880 effective increase I 35.9% 10/8/01 Table 12-2A PROPOSED RATES Owner (City) Projected Annual Revenue Based Upon a ONE TIME 35% Adjustment 9/20/01 4 Revenue Revenue TOTAL Monthly Equivalent Total Billed (Ready- (Volume) Revenue % increase Rate Accounts Flow (UOC) to -Serve) 10 UOC (see Table (see Table 5-9) 5-1) EXISTING RATE Ready -to -Serve Charge $8.33 per Meter Equivalent Volume Charge 51.49 per Unit of Consumption (748 gallons) $23.23 2001 21,180 3,233,875 $2,117,153 $4,818,474 $6,935,627 actual % PWTF @ 2.0% increase Ready -to -Serve Charge 58.50 2.04% (2% for PWTF loan) 2.0% Volume Charge $1.49 0.00% 0.0% $23.40 actual % STEP ONE @ 35.0% increase Ready -to -Serve Charge $11.48 35.06% 35.00% Volume Charge $2.01 34.90% 35.00% $31.58 2002 23,565 3,494,674 53,246,314 $7,024,295 $10,270,609 % increase 11.26% 8.06% 53.33% 45.78% 48.08% actual % Combined % NO INCREASE increase Increase Ready -to -Serve Charge 511.48 0.00% 37.82% Volume Charge $2.01 0.00% 34.90% $31.58 2003 1 23,683 3,503,410 $3,262,570 $7,041,854 $10,304,424 % increase 0.50% 0.25% 0.50% 0.25% 0.33% actual % Combined % NO INCREASE increase increase Ready -to -Serve Charge $11.48 1 0.00% 1 37.82% Volume Charge $2.01 0.00% 34.90% $31.58 2004 23,801 3,512,169 $3,278,826 $7,059,460 $10,338,285 % increase 0.50% 0.25% 0.50% 0.25% 0.33% actual % Combined % NO INCREASE increase Increase Ready -to -Serve Charge 511.48 0.00% 37.82% Volume Charge 52.01 0.00% 34.90% 531.58 2005 23,920 3,520,949 53,295,219 57,077,107 510,372,327 % increase 0.50% 0.25% 0.50% 0.25% 0.33% actual % Combined % NO INCREASE increase Increase Ready -to -Serve Charge 511.48 0.00% 37.82% Volume Charge 52.01 0.00% 34.90% 531.58 2006 24,039 3,529,752 53,311,613 57,094,802 510,406,414 % increase f 0.50% 0.25% 0.50% 0.25% 0.33% 9/20/01 Table 12-2R PROPOSES) RATES Owner (City) Projected Annual Revenue based upon THREE ANNUAL 10.5% INCREASES 9/20/01 * 1 a.v.nu. R.vhnu. I TOTAL 1 I Ynrdi+ry. Equivalent Total Billed (Ready- (Volume) Revenue Rate Accounts Flow (UOC) to -Serve) % Increase 10 UOC (see Table (see Table 5-9) 5-1) EXISTING RATE Ready -to -Serve Charge $8.33 per Meter Equivalent Volume Charge $1.49 per Unit of Consumption (748 gallons) $23.23 2001 21,180 3,233,875 $2,117,153 *4,818,474 $6,935,627 actual % ourre a,' nal- increase Ready -to -Serve Charge $8.50 2.04% (2% for PWTF loan) 2.00% Volume Charge $1.49 0.00% 0.00% $23.40 actual % PHASE ONE @ 10.5% increase Ready -to -Serve Charge *9.39 10.47% 10.50% ! Volume Charge $1.65 10.74% 1 10.50% I $25.89 2002 23,565 3,494,674 $2,655,304 $5,766,212 $8,421,516 % increase 11.26% 8.06% 25.42% 19.67% 21.42% actual % Combined % PHASE TWO @ 10.5% increase Increase Ready -to -Serve Charge *10.38 10.54% 24.61% 10.50% Volume Charge $1.82 10.30% 22.15% 10.50% $28.58 2003 23,683 3,503,410 $2,949,954 *6,376,206 $9,326,161 % increase 0.50% 0.25% 11.10% 10.58% 10.74% 1 actual % Combined % PHASE THREE @ 10.5% increase Increase Ready -to -Serve Charge $11.47 10.50% 37.70% 10.50% Volume Charge $2.01 10 44% 34.90% 10.50% $31.57 2004 23,801 3,512,169 $3,275,970 *7,059,460 310,335,429 % increase 0.50% 0.25% 11.05% 10.72% 10.82% actual % Combined % NO INCREASE increase Increase Ready -to -Serve Charge $11.47 0.00% 37.70% 0.00% Volume Charge *2.01 0.00% 34.90% 0.00% $31.57 2005 23,920 3,520,949 $3,292,349 *7,077,107 310,369,456 % increase 0.50% 0.25% 0.50% 0.25% 0.33% actual % Combined % NO INCREASE increase Increase Ready -to -Serve Charge $11.47 0.00% 37.70% 0.00% Volume Charge *2.01 0.00% 34.90% 0.00% $31.57 2006 24,039 3,529,752 $3,308,728 $7,094.802 *10,403,529 % increase 0.50% 0.25% 0.50% 0.25% 0.33% 9/20/01 Table 12-2C PROPOSED RATES Owner (City) Projected Annual Revenue based upon ONE INCREASE OF 17.5% FOLLOWED BY 4 ANNUAL INCREASES OF 3.5% 9/20/01 1 Ravenue Revenue TOTAL Monthly Equivalent Total Billed (Ready- (Volume) Revenue Rats Accounts Flow (UCC) to -Serve) % increase 10 UOC (see Table (see Table 5-9) 5-1) EXISTING RATE Ready -to -Serve Charge 58.33 per Meter Equivalent Volume Charge 51.49 per Unit of Consumption (748 gallons) $23.23 2001 21,180 3,233,875 52.117,153 $4,818,474 $6,935,627 actual % PWTF 6)2.0% increase Ready -to -Serve Charge $8.50 2.04% (2% tor PWTF loan) 2.00% Volume Charge $1.49 0.00% 0.00% $23.40 actual % PHASE ONE @ 17.5% increase Ready -to -Serve Charge $9.99 17.53% 17.50% Volume Charge $1.75 17.45% 17.50% $27.49 2002 23,565 3,494,674 $2,824,972 $6,115,680 58,940,652 % increase 11.26% 8 06% 33.43% 26.92% 28.91% actual % Combined % PHASE TWO @ 3.5% increase Increase Ready -to -Serve Charge $10.34 3.50% 24 13% 3.50% Volume Charge $1.81 3.43% 21 48% 3.50% $28.44 2003 23,683 3,503,410 I $2,938,587 $6,341,172 $9,279,759 % increase 0.50% 0.25% 4.02% 3.69% 3.79% actual % Combined % PHASE THREE @ 3.5% increase Increase Ready -to -Serve Charge $10.70 3.48% 28 45% I 3.50% Volume Charge $1.87 3.31% 25.50% j 3.50% $29.40 2004 23,801 3,512,169 $3,056,048 $6,567,756 $9,623,804 % increase 0.50% 0.25% 4.00% 3.57% 3 71% actual % Combined % PHASE FOUR @ 3.5% increase Increase Ready -to -Serve Charge 511.07 3.46% 32.89% 3.50% Volume Charge 51.94 3.74% 30.20% 3.50% 530.47 2005 23,920 3,520,949 53,177,533 $6,830,641 S10,008,174 % increase 0.50% 0.25% 3.98% 4.00% 3.99% actual % Combined % PHASE FIVE @ 3.5% increase Increase Ready -to -Serve Charge $11.46 3.52% 37.58% 3.50% Volume Charge 52.01 3.61% 34.90% 3.50% $31.56 2006 24,039 3,529,752 53,305,843 $7,094,802 510,400,645 % increase 0.50% 0.25% I 4.04% 3.87% 3.92% 9/20/01 Table 12=3 EXISTING RATES Owner (City) Projected Annual Revenue Existing Rates 9120/01 # Revenue Revenue TOTAL Equivalent Total Billed (Ready- (Volume) Revenue Accounts Flow (UOC) to -Serve) (see Table (see Table 5-9) 5-1) EXIS11NG RATE Ready -to -Serve Charge $8.33 _ per Meter Equivalent v o::i:eCharge w1o49 i per Unit of Consumption (7I8 caeeons) 2001 21,180 3,233,875 $2,117,153 $4,818,474 $6,935,627 large increase in accounts and billable flow due to South 72 Annexation 2002 23,565 1 i 494 674 $2,355,557 v 1 $5.207.064 $7,562,622 % increase 11.26% 8.06% 11.26% 8.06% 9.04% 2003 23,683 3,503,410 $2,367,353 $5,220,081 $7,587,434 % increase 0.50% 0.25% 0.50% 0.25% 0.33% 2004 23,801 3,512,169 $2,379,148 $5,233,132 $7,612,280 % increase 0.50% 0.25% 0.50% 0.25% 0.33% 2005 23,920 3,520,949 $2,391,043 $5,246,214 $7,637,257 % increase 0.50% 0.25% 0.50% 0.25% 0.33% 2006 24,039 3,529,752 { $2,402,938 $5,259,330 $7,662,269 increase 0.50% 0.25% 0.50% 0.25% 0.33% 9120/01 Table 12-4 Required Additional Revenue City Retail Customers 10/8/01 Object Report Section 2001 2002 2003 2004 2005 2006 Code Projected EXPENSE Projected Wastewater Expense Table 4-28 $8,991,120 $977,871 $9,833,501 $1,116,948 $10,000,410 $1,173,206 $10,866,518 $1,290,561 $11,625,000 $1,390,191 $11,858,062 $1,420,492 Utility Tax @ 14% Total Expense $9,968,991 $10,950,449 9.85% $11,173,616 2.04% $12,157,079 8.80% $13,015,191 7.06% $13,278,554 2.02% % increase (") Utility Tax not assessed against revenue collected from Wholesale Municipal Customers or for Debt Coverage. Projected REVENUE (includes Utility Tax where Table 6-2 applicable) Pretreatment Fees SPT $181 875 $466530 $643,324 $665 _731 $689,055 $713,335 County Retail CCP Table 7-1 $1252,256 $146,069 $150,766 $155,303 $160,115 $164 988 County Retail Strong Waste SNR Sect. 8 Text $2,500 $500 $500 $500 $500 $500 Se_pta$e SWD Sed. 8 Text $1,950 $2,370 $2,780 $2780 $2,780 $2,780 Union Gap Table 9-1 $428 517 $459,742 $481,917 $493,518 $526 449 $537 579 Terrace Heights Table 9-1 $205049 $221,380 $233,318 $240,100 $257,605 $264,395 Del Monte Settlemnt/Contribution $7500 $75,200 $75200 $75,200 $75 200 $75,200 Wastewater Connection Fees $302000 $317,100 $332,956 $349 602 $367,082 $385,438 City Strong_Waste SWR Table 11-1 $453 621 $6401138 $646,540 $653 005 $659 535 $666,130 (includes Del Monte] Total Other Revenue $2,902,968 % increase $21329,029 -19.77% $2567,301 10.23% $2,635,739 2.67% $2,738,321 3.89% $2,810,345 2.63% Required Additional Revenue $7,066,023 % increase $8,621,420 22.01% $8,606,315 -0.18% $9,521,340 10.63% $10,276,870 7.94% $10,468,209 1.86% From City Retail Customers $6,559,108 $6,661,875 $3,806,334 63.64% City Wholesale Table 9-1 $5,683,819 $5,807,186 $6,071,170 $6,183,589 City (Other) $1,382,204 $2,814,234 67.36% $2,535,145 70.54% $3,337,751 64.94% $3,717,762 63.82% % wholesale of total 80.44% ratio set Operations Table 4-2 67.78% $5,833,361 Capital Expense Table 4-2 32.22% $2,772,955 10/8/01 To: From: Re: Transmittal Memorandum October 12, 2001 Honorable Mayor and Members of the City Council, Dick Zais, City Manager Glenn Rice/Assistant City Manager Doug Mayo/Wastewater Manager Update to MANDATED Draft 2000 Wastewater Facilities Plan In November 2000, staff transmitted to Council the Mandated Draft 2000 Wastewater Facilities Plan. This technical memorandum looked to the capital and operations and maintenance requirements (including staffing) of the wastewater system to serve the area for the next 20 years without considering the inclusion of wastewater from Del Monte. This Update looks to the capital and operations and maintenance requirements made necessary by the inclusion of Del Monte wastewater into the treatment facility. Data from the 2000 season was analyzed for this update, 2001 data has not yet been completed or analyzed. As shown in this Update, due to the Del Monte flow, treatment facility capital requirements for the next six years, have increased from $12,200,000 to $13,811,200. This amount, when added to the $7,048,300 required for collection system improvements and $5.7 million in additional staffing requirements, yields a need of $26.6 million over the next five years. Of this, $22.4 million (84%) is due to the City's legal, mandated, and contractual obligations. Compliance with federal and/or state mandatory regulations requires adequate funding sources regardless of ability to pay. Although the federal and/or state regulatory agencies sometimes provide partial funding for mandated improvements in the form of grants and/or loans, those resources have been drastically diminished over the last decade. As a consequence, the City of Yakima and the Yakima Regional WWTP will be required to use wholesale and retail revenues to pay a substantial portion (as much as 90% or more) of the total cost either as cash or through debt payments. The impact to wholesale and retail rates will be significant. The 2001 Cost of Service and Rate Study is currently before you for consideration and action. This Study presents strategies to finance the mandated improvements over the next 6 years and beyond. An Update to the Wastewater Connection Charge that accompanies the Facilities Plan will follow next summer. Please insert this Update in the front of your Wastewater Facilities Plan binder, which you received in November 2000. City of Yakima Washington TECHNICAL MEMORANDUM Wastewater Treatment Plant Update to Facility Plan / Including Food Processing Waste - March 2001 prepared by JB Neethling HDR Engineering, Inc. reviewed by John Koch Bud Benjes EXECUTIVE SUMMARY YAKIMA WWTP UPDATE TO FACILITY PLAN / INCLUDING FOOD PROCESSING WASTE - MARCH 2001 Summary of Operations In Fall 2000, the City wastewater treatment facility processed the Del Monte wastewater in the plant to determine the treatability of the food processing waste and the impact on the treatment plant operation. From August 30, 2000 to October 1, 2000 food-processing waste was incrementally added to the primary effluent to monitor the effects on the trickling filters and aeration basins. Throughout the month of October and through the end of the food-processing season all the Del Monte flow was treated by the plant. Dissolved oxygen levels in the trickling filter effluent remained above 2 mg/1 and the plant effluent met the NPDES discharge permit requirements. Operational problems encountered when treating all the food processing waste were: O Trickling filter media was flushed daily by hand to remove built up solids. U Excessive foam accumulation on aeration basins. o Secondary clarifier foam accumulation which required manual skimming of the clarifiers during the final weeks of operation. Secondary Clarifier Scum Executive Summary Evaluation of Food Processing Waste 1 • SVI's increased to 135 whereas the plant normally operates below 100. • Aeration basin MLSS increased to nearly 4,000 mg/1. • For the 2001 food processing waste season, the parameters monitored during the Fall 2000 season should be monitored to maintain compliance with the facility's NPDES permit. The flow from Del Monte was relatively low in suspended solids and the pH was maintained at a relatively constant level. The Del Monte wastewater characteristics must be continuously monitored during the food processing season to eliminate plugging of the trickling filter rock media and subsequent biological upsets which could cause catastrophic process failures. A plan of action to divert the food processing waste away from the trickling filter and aeration basin needs to devised and implemented and suspended solids are not Predetermined ........a.t....,,.d�.:a.,yo,.. if the pH «�:,�� e.e�a �.:avm in a Predetermined ie..z xxnxa�a.,az acceptable range so as not to overload the treatment facility. An empty primary clarifier could store approximately 67% of one day's flow from Del Monte. T ).� y T r acilitImprovements Based upon the results of the testing during the Fall of 2000 the Mandated Facility Plan Improvements as contained in Tables 1-12 through 1-14 were revised. Costs in the tables include the construction, engineering, legal, fiscal and administrative costs and a planning contingency allowance. Items crossed out in Table 1-12 are no longer required. Items listed in the growth column for the treatment plant improvements are related to the immediate improvements necessary to treat Del Monte food processing waste. Table 1-12 on the next page identifies all improvements (treatment and collection) to be implemented during the 0-6 year period. Table 1-13 identifies all improvements (treatment and collection) to be implemented during the 7-12 year period. Several of the improvements where moved forward to the 0-6 year interval to accommodate the increased loads from the food processing waste. Executive Summary Evaluation of Food Processing Waste 2 Table 1-12.0-6 Year Priority Improvement Projects Opinion of Mandatory' Improvement Probable Renewal Growth' Numbers Facility Description Cost Regulations /Safety FWWTP Emergency Generator overhaul/replacement 5100.000 5100,000 FNWTP-3 Primary Clarifier Collection Mechanisms (2 of 4) 5200.000 5200,000 FW WTP 4B Primary Sludge Pumping Lighting Replacement 510.000 510.000 FWWTP-7A Trickling Filter Door/Walkway Covers 585,000 585.000 FW WTP 7B Trickling filter Mechanism (Both) 5650,000 5325.000 5325,000 FWWTP-8A Repair Existing Aeration Basin 5181,000 $181,000 FWWTP-8B Replace Blower VFD's (2 of 4) 5245,000 5245,000 FWWTP-8C Aeration Basin Diffusers Rehab 550,000 550,000 FWWTP-9A Refurbish Secondary Clarifier Bull -Gears 5120.000 5120,000 FWWTP-9B Replace Secondar Clarifier Exterior Launders 5257,000 5257,000 Replace Secondary Clarifier FWWTP-9C Skimmer Mechanism/Scum Box 5362,000 5362,000 FW WTP-10 Refurbish DAFT Air Compressor/Pipelines 5267,000 5267,000 PNWTP 12 Trickling filter Eyal..utien $307000 $30,000 Deleted from Plan FWWTP 13 Field Test Oxygen ttsfei Efficiency 8550,000 $50:000 Deleted from Plan Trickling Filter Clarifier Moved from FWWTP-7D Solids Removal System $425,000 $425,000 /Dewatering 13-20 yr FWWTP-7D Trickling Filter Clarifier Gates $50,000 Moved front7- $50,000 12 yr Trickling Filter Effluent Pumping Station $652,000 Added $652,000 Secondary Clarifier Spray Nozzle installation $15,000 Added $15,000 FWWTP-14 Secondary Clarifier Evaluation 550,000 550,000 FWWTP-15 Miscellaneous Improvements 5200,000 5200.000 Subtotal FWWTP Improvements 53.919,000 5526.000 $1.926,000 51,467.000 WWTP-2 Grit Storage Hopper 5100,000 5100,000 WWTP-5 New RAS/WAS Pumping Station 51,669,400 51,669.400 ' WWTP-11B New Centrifuge 1,345,000 $1,345,000 Moved from 7- WWTP-6 New Secondary Clarifier 53,277,800 53,277,800 WWTP-13 Truck Storage 5400,000 5400.000 WWTP-16 Biosolids Handling 53.100.000 53,100,000 Subtotal WWTP Improvements $9.892.200 58.447 200 51,445,000 SO TOTAL Treatment Plant Improvements 513,811.200 $8.973.200 $3.371.000 51.467,000 Collection ModeUMonitonng Section 22 $240.000 5240.000 Collection Facility Table 11-11 5694.000 5694,000 Collection Facility Table 11-13 & 52,489,300 51.173.000 $1,316,300 Collection Facility Table 11-14 (2 53.625.000 52.308.700 51.316.300 Subtotal Collection Facility 57,048,300 52,548.700 $1.867.000 52.632.600 TOTAL TREATMENT/COLLECTION $20.859500 511.521.900 $5,238.000 $3.099,600 * Indicates benefits to Growth related issues Compliance with federal/state laws and regulations, and the Four Party Agreement Executive Summary Evaluation of Food Processing Waste 3 Table 1-13.7-12 Year Priority Improvement Projects Mandatory i Improvement Numbers Facility Description Opinion of Probable Cost Regulations Renewal /Safety Growth2 FWWTP-1 FWWTP-3 FWWTP-5 FWWTP-6 FWWTP 7B Influent Building Primary Clarifier Collection Mechansims (2 of 4) Sludge Transfer Building Refurbishment Replace Intermediate Grit Box Center Wall _ $50,000 $200,000 $100,000 $250.000 $50.000 $200.000 $100,000 $250,000 $394,200 $394.200 Moved to 0-6 years Trickling Filter Clarifier F\VWTP 7D FWWTP-8B FWWTP-11B FWWTP-15 Gates Replace Blower VFDs (2 of 4) Install Secondary Digester Gas Flare Miscellaneous Improvements X800 5245,000 $60,000 $400.000 $200,000 $50900 5245,000 $60,000 $200.000 Moved to 0-6 years Subtotal FWWTP Improvements $1,305.000 $200.000 $1,105,000 WWTP-2 WWTP-7C WWTP-4A WWTP-4B WWTP-7A WWTP-7B WWTP-8 WWTP-9 WWTP-10 WWTP-I IA WWTP 11B Gnt Storage Hopper Additional Blower Trickling filter Media Replacement Trickling filter Forced Ventilation Anoxic Selector Cells Aeration Basin (2.1 mg) UV Disinfection WAS Thickening Centrate Pretreatment Solids Building Nc,.. Centrifuge Polymer System Laboratory Modifications New Boiler/hot water $212,100 $547,800 $1,699,100 5212,100 X00 51,066,100 Moved to 0-6 $150,000 $547,800 Deletal due to testing done during Fall 2000. Moved to beyond 2020 unless media plugs at Loads > tested $4.366,600 * * * yr as existing Bird * * * $1,066.100 52,480,000 $4.366,600 $3,931,100 51.338,600 $1,912,700 $3,412.600 X9400 $976,200 $1.000,000 $150,000 52,480,000 $3,931,100 $ 1,338,600 $1,912.700 $3.412,600 $-1.589;-1.00 $976.200 $1.000,000 WWTP-1 1C WWTP-12 WWTP-14 Subtotal WWTP improvements 521.393.800 515.051.200 $1.428.200 $4,914.400 TOTAL Treatment Plant Improvements $22,698.800 $15.251,200 $2.533.200 $4,914.400 Collection Facility Table 11-15 (inc Maintenance Bldg Section 11 Collection Facility Table 11-14 $6.291,700 53,257,600 $12,642.200 $2,282,400 52.606,100 53.792.700 $4,009.300 $651,500 $8,849,500 Subtotal Collection Facility 522.191.500 58.681.200 $13,510.300 TOTAL TREATMENT/COLLECTION $44.890.300 $23.932.400 $2.533.200 $18,424,700 * Indicates benefits to Growth related issues 1 Compliance with federal/state laws and regulations, and the Four Party Agreement 2 Non -mandatory growth /system expansion. 3 30% Mandatory, 70% Growth Executive Swnmary Evaluation of Food Prores'vng Lt aste 4 Table 1-14 on the next page identifies all Improvements to be implemented dunng the 13- 20 year penod. Again items have been moved forward due to the increased load of the food processing waste. Table 1-14,13-20 Year Priority Improvement Projects Improvement Numbers Facility Description Opinion of Probable Cost Mandatory' Growth` Regulations Renewal /Safety FWWTP-4A Primary Sludge Pumping $240,000 $240.000 Density and Flow Meters Trickling Filter Clarifier FWWTP 7D Solid ,tel $425.880 $445,0, 00 Moved to 0-6 years Sy-stereA3ewatefifig Add Secondary Digester FWWTP-1 IA Recirculation Pumps $203.000 $203,000 FWWTP-15 Miscellaneous Improvements $400.000 $400.000 Subtotal FWWTP Improvements $843.000 $843.000 WWTP-1 Septage Receiving Facility $2,079.300 $2,079.300 WWTP-3 Primary Split Box $870,500 $870,500 * WWTP-7C Additional Blower - 2nd $547,800 $547,800 WWTP-15 Mesophilic Digestion $4.000.000 $4,000.000 Subtotal WWTP Improvements $7,497.600 $2,079300 $870.500 $4.547,800 TOTAL Treatment Plant Improvements $8,340,600 $2,079,300 $1,713,500 $4,547,800 Collection Facility Table 11-14 (40%)i $10.844,700 $3,253.400 $7,591.300 Subtotal Collection Facility $10,844.700 $3.253,400 $0 $7.591.300 TOTAL TREATMENT/COLLECTION $19,185,300 $5,332,700 $1,713,500 $12339,100 * Indicates benefits to Growth related issues t Compliance with federal/state laws and regulations, and the Four Party Agreement Non -mandatory growth /system expansion. 3 30% Mandatory. 70% Growth Table 1-15 summarizes the total opinion of probable cost for wastewater treatment plant and collections system costs over the next 20 years by the time period for which they are anticipated to occur. Executive Sunman' Eraluatron of Food Proressrng Waste 5 Table 1-15. Summary of Improvements 'TREATMENT / COLLECTION MANDATORY' TOTAL %TOTAL MANDATORY % GROWTH OPINION OF PROBABLE COS'T'S KEGULATIONS RENEWAL / SAFETY GROWTH2 Wastewater Treatment 0-6 Year Projects 7-12 Year Projects 13-20 Year Projects 89.4% 78.3% 45.5% 10.6% 21.7% 54.5% $ 13,811,200 $ 8,973,200 $ 3,371,000 $ 1,467,000 $ 22,698,800 $ 8,340,600 $ 15,251,200 $ 2,533,200 $ 4,914,400 $ 2,079,300 $ 1,713,500 $ 4,547,800 Total Treatment Plant Improvements $ 44,850,600 $ 26,303,700 $ 7 617 700 > 75.6% $ 10,929,200 24.4% Collection Faciltiy 0-6 Year Projects 62.6% 39.1% 30.0% 37.4% 60.9% 70.0% $ 7,048,300 $ 2,548,700 $ 1,867,000 $ 2,632,600 7-12 Year Projects 13-20 Year Projects $ 22,191,500 $ 8,681,200 $ - $ 13,510,300 $ 10,844,700 $ 3,253,400 $ - $ 7,591,300 Total Collection Facility Improvements $ 40,084,500 $ 14,483,300 $ 1,867,000 40.8% - $ 23,734 � 200 59.2% Total Treatment / Collection $ 84,935,100 $ 40,787,000 $ 9,484,700 59.2% $ 34,663,400 40.8% Mandatory compliance `' Non -mandatory growth/system with federal/state laws and regulations, and the Four Party Agreeement, Non-mandoratory growth/system expansion receives a benefit expansion 'For the 0-6 Year period, a total of $20,859,500 is required. $16,759,900 or 80.3% percent, is required to meet mandatory obligations. $4,099,600 or 19.7%, is Executive Summary Evaluation of Food Processing Waste 6 NW Ns111116MINI Ill. INN MO aleEll MN NI* — 11111 I OM 1111111 1 1 1 1 1 1 I 1 1 1 t 1 1 t 1 t 1 For those Mandatory Projects which result in benefits to Growth as indicated in Tables 1- 12, 1-13 and 1-14, that portion of the total opinion of probable cost benefiting other Growth has been identified in Table 1-16. Table 1-16. Assignment of Probable Cost to Growth of the Service Area Improvement Number Facility Description Opinion of Probable Cost Mandatory Growth WWTP-3 Primary Split Box 3 $ 870,500 $ 435,250 $ 435,250 WWTP 4A 2S.--49974408 S-339,890 x9300 WWTP-4B Trickling Filter Force Ventilation 2 $ 1,066,100 $ 213,200 $ 852,900 WWTP-5 New RAS/WAS Pumping Station 1 $ 1,669,400 $ 834,700 $ 834,700 WWTP-6 New Secondary Clarifier 1 $ 3,277,800 $ 1,638,900 $ 1,638,900 WWTP-8 UV Disinfection2 $ 3,931,100 $ 3,144,900 $ 786,200 WWTP-10 Centrate Pretreatment 2•$ 1,912,700 $ 956,350 $ 956,350 WWTP-11A Solids Building 2 $ 3,412,600 $ 2,047,600 $ 1,365,000 WWTP-11C Polymer System 2 $ 976,200 $ 488,100 $ 488,100 WWTP-12 Laboratory Modifications 2 $ 1,000,000 $ 700,000 $ 300,000 WWTP-13 Truck Storage 1 $ 400,000 $ 100,000 $ 300,000 WWTP-14 New Boiler/hot Water $ 150,000 $ 50,000 $ 100,000 WWTP-16 Biosolids Handling 1 $ 3,100,000 $ 2,480,000 $ 620,000 Total Assignment of Improvements $ 21,766,400 $ 13,089,000 $ 8,677,400 1 0-6 Year Priority Improvements (Table 1-12) 2 7-12 Year Priority Improvements (Table 1-13) _ 3 13-20 Year Priority Improvements (Table 1-14) While the Fall 2000 testing demonstrated the treatment capacity of the liquid treatment facilities, it is unclear what the impact of the added load on the solids treatment processes will be. The impacts were quantified in this analysis based on the data collected during the Fall 2000 season. Special attention will have to be paid to the solids processing to assess any unknown impacts on solids processing. Total impact on solids processing needs to be monitored for the next year. There have been indication from the operators that the digested sludge does not dewater as well when compared to the sludge characteristics prior to the introduction of the food processing waste. More polymer per ton has been required and the cake percent solids has decreased. No nutrient deficiency was noted in the Fall 2000 season. However, special attention should be paid during the next few seasons to detect nutrient impacts. Flushing the trickling filters is important with the highly soluble wastewater to prevent plugging the media with biomass. The trickling filter drives should be motorized to provide control over the rotational speed. In addition, the drives controls should be designed to provide the flexibility to accommodate heavy flush periods for biofilm growth control. If the food processing waste is to be treated by the Yakima WWTF in the summer/fall of 2001 the following items are recommended for immediate improvement: Erecunve 5umma7 Evaluation of Food PraresAing LVaste 7 • The trickling filter mechanisms need to be upgraded to motorized units so the rock media can be flushed. o As has been the experience during past construction projects when the trickling filters have been take out of service, a minimum of two weeks between starting one up and taking the other one out of service is normally required. o To be ready for the canning season, the trickling filter construction should be completed by the July 1, 2001 to allow the filters to build a biomass. • Provisions to thicken the WAS with rental equipment if any of the DAF equipment require maintenance chnnld he anticipated Potential solutions would be to rent a trailer mounted gravity belt thickener or thickening centrifuge for the canning season. The critical link in processing the food waste is the solids handling system. A failure in any portion of the system will lead to long-term operational problems and permit violations. • intermediate Trickling Filter Clarifier rehabilitation with sludge pumping facilities to DAF should be in place for the 2001 canning season to reduce the potential of overloading the activated sludge aeration basins. Monitoring the process and the incoming waste stream flow from Del Monte will be of paramount importance during the next as well as all the canning seasons. The biological waste load is significant and does have an effect on the operation of the facility. Increases in suspended solids due to process failures at Del Monte will have a major impact on the treatment facility and its ability to maintain compliance with the City's NPDES permit. On-line pH meter and observation of food processing waste stream flow must be a priority for the operators throughout the processing season. Ererurrre Summary Evaluation of Food Processing Waste 8 Yakima WWTP Update to Facility Plan / Including Food Processing Waste - March 2001 Secondary Treatment Testing and Recalibration In Fall 2000, the City processed Del Monte wastewater in the treatment plant to determine the degree of treatment possible and the impact on the plant operation. Based on the testing data collected. the secondary treatment process modeling and capacities were recalibrated. The recalibration focused on three aspects: • Trickling filter loading limits and performance • Trickling filter removal efficiency and solids production • Activated sludge mixed liquor suspended solids (MLSS) lirruts Trickling Filter Loading and Performance The trickling filter loading was previously set at a maximum of 65 lb BOD/1000 cf/d. During Fall 2000 the BOD loading to the trickling filters was dramatically increased above this limit without significant negative impacts. See Figure 1 for the loading and removal efficiency during, Fall 2000. The BOD removal efficiency in this period is about 65% of the applied BOD. The data shows a large degree of scatter which is typical for trickling filter operations. The process modeling used in this analysis is based on the modified Velz equation. Following calibration of the model, the results of the calibration are shown in Figure 2. The fit is reasonable for field type data. The calibrated treatability coefficient (k20 = 0.0074 (sf/gpm)°i) is significantly different from the normal value of 0.0020 (sf/gpm)°1. The higher treatability coefficient is due to the large amounts of soluble and rapidly degradable substrate in the food processing wastewater. At the lower loading rates, the more typical treatability coefficient would fit the data well, but the removal efficiency at the higher loading_ rates are significantly better than for normal domestic wastewater. The solids production rates for the trickling filter during Fall 2000 were calculated based on a cumulative plot as shown in Figure 3. Since the Velz model predicts the effluent soluble BOD, the yield calculations in the calculations are based on the BOD removal, calculated as total BOD (tBOD) in the trickling filter feed minus the soluble BOD (sBOD) remaining. Based on the Fall 2000 operation, the yield is 0.625 lb TSS/lb BODtotal removed: or 0.46 Ib TSS/lb (tBOD feed — sBOD effluent). El 4LL'4TIOV OF FOOD PROCESSING BASTE 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 f 1 80.0 70.0 - 60.0 50.0 E> 40.0 - m 30.0 - • • 20.0 - - 10.0 180 160 140 120 100 80 60 40 20 1 ti . r y=0.6548x-1.71311 R2 = 0.786] • Lower BODrem = 0.48'OLR • - - . 0 20 40 60 TF loading. Ib BODIkcUd • BOD removed, lb/kcf.d —Linear (BOD removed, Ib/kcf.d) Figure 1. Loading and Performance on Trickling Filter during Fall 2000. 80 100 120 0 7/13/00 8/2/00 8/22/00 9/11/00 10/1/00 10/21/00 11/10/00 11/30,00 -}BODout U TBODout_calc Figure 2. Measured and Model Predictions for the Trickling Filter Performance. EVALUATION OF FOOD PROCESSING WASTE 2 2,000,000 1,800,000 1,600,000 1,400,000 1,200, 000 1,000,000 800,000 600,000 400,000 200,000 0 Slope - 16,900 Ib (BODpe-sBODtf)/d Slope - 12,400 Ib (BODpe-BODtf)/d rem TF 'Yield' = 0.625 lb TSS/lb BODrem TF 'Yield2' = 0.46 Ib TSS/lb (BODin-sBODout) Average 87% VSS/TSS to give TF "Yield2" = 0.40 Ib VSS/Ib (BODin-sBODout) 7/13/2000 Slope - 7,750 Ib TSS/d out 8/2/2000 8/22/2000 9/11/2000 10/1/2000 10/21/2000 11/10/2000 11/30/2000 CumTSSout, Ib TSS —M—Cum BODrem, Ib BOD CumBODremov J Figure 3. Cumulative BOD removal and Solids Production during Fall 2000. Del Monte Influent Characterization The wastewater characteristics for the Fall 2000 season are shown in Table 1 and Figure 4. Flow from Del Monte was on a Monday -Friday cycle with Saturday as a washdown/cleanup day and Sundays and holidays as non -work days. The days with zero flow other than the non - work days were assumed to be missing data. Average daily flow from Del Monte was 0.36 mgd. The values in Table 1, except as noted in the footnotes, are raw data values without adjustments for obvious data errors. Flow, data collection, sampling and possible testing discrepancies may have skewed the data in Table 1. The data analyzed to detect potential errors in analysis or reporting. Analytical results for biochemical oxygen demand (BOD), soluble biochemical oxygen demand (SBOD), and total suspended solids (TSS) from the City wastewater plant laboratory were compared to those of Laucks Testing Laboratories, a private laboratory used by Del Monte. The BOD and SBOD values between the two laboratories were in reasonable close agreement, on average the Laucks Testing Laboratory data were 10% lower than the City EVALUATION OF FOOD PROCESSING WASTE 3 data. TSS data, however, varied dramatically: on average the City laboratory data were 36`ic of the Laucks Testing Laboratory results. Both TSS datasets are questionable. Normally. a good check of the results for domestic wastewater is to review the particulate BOD/TSS or BOD/volatile suspended solids (VSS) ratios. Note that the Del Monte wastewater is 96% volatile solids and the typical ratios will not apply. Theoretically, the particulate biochemical oxygen demand (PBOD)/VSS ratio is 1.42 ib PBOD/lb VSS, or 1.48 1b PBOD/lb TSS. Using the dataset. we calculated PBOD/TSS ratios of 2.56 and 2.96 for the City laboratory and Laucks Testing Laboratories data, respectively. The values, however. ranged dramatically from 0.24 to 18.0. This large range is very suspicious. However, the averaged ratio's are at least reasonable. We modified the City dataset for TSS as follows: All values above 500 mg/L TSS were replaced with a calculated TSS value, using a PBOD/TSS ratio of 2.0. By doing so. the calculated average TSS concentration dropped from 1.036 to 333 mg/L. Based on the results from the outside laboratory and the cross-check built into this value. we believe it to be a reasonable estimate of the TSS. Flow data were also adjusted based on the "Total Del Monte Flow" and "Del Monte flow sent to treatment plant" values. Due to some flow meter inaccuracies. these numbers don't always coincide, but are generally close. We selected the maximum of these two numbers as the flow from Del Monte. Note also that the dataset includes many zero values. We suspect that these are missing data points and are not true zero flow values except on the weekends and holidays. Therefore, the flow data is analyzed to exclude all zero values as shown in Table 1. Table 2 presents the design data and reduces the discrepancies associated with collection and testing described above. Because the loading is seasonal and varies from week to week. the statistical maximum month (average plus 1.38 standard deviation) is used for the base load to the plant during the processing season. El ALL 4TIO\ OF FOOD PROCESSING l% 4STE 4 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 t 1 1 6,000 5,000 — 4,000 — a cd 3,000-- 0 0 2,000 — 1,000 — - 0 7/13/00 20,000 18,000 16,000 14,000 12,000 vi rn v 10,000 ,`a m 8,000 6,000 4,000 2,000 0 8/2/00 8/22/00 9/11/00 10/1/00 10/21/00 I—M-50D, (mg/L) TSS, (mg/L) tMaxFlow, mgd 1 11/10/00 0 4 0.40 0.35 - 0.30 0.257. 0.20 LL 0.15 0 10 0.05 0.00 11/30/00 Figure 4. Flow, BOD, and TSS from Del Monte during Fall 2000. • • • 1• -40 • ■ _ •. 7/13/00 8/2/00 8/22/00 9/11/00 10/1/00 10/21/00 • BOD, Ib/d 7 per. Mov. Avg. (MaxFlow excl "0", mgd) ♦ TSS, Ib/d 0 45 0.4 0.35 0.3 0.25 0.2 LL 0.15 0.1 - 0.05 0 11/10/00 11/30/00 • MaxFlow excl "0", mgd 7 per. Mov. Avg. (BOD, Ib/d) — —7 per. Mov. Avg. (TSS, lb/d) Figure 5. Flow, BOD and TSS load from Del Monte. Lines indicate 7 -day moving averages. EVALUATION OF FOOD PROCESSING WASTE 5 Table 1. Del Monte Wastewater Characteristics'for Fall 2000. Average Max Min MM 7Day Max Flow all days) MGD 0.177 0.417 0.000 0 418 Flow exclude zero flow days: MGD 0.36 0 417 0.013 0 470 0.38 BOD mg/L 4.026 5.100' 300 5.151 Soluble BOD mg/L 3.386 4.2004 500 4.700 TSS m /L 333 692 177 519 VSS % 95 100 79 101 Ammonia mg/L 2 22 0 7 BOD lb/d 11.826 17.491 111 17.113 15.200 Soluble BOD lb/d 10.105 24.595 185 15.498 TSS lb/d 933 2.244 83 1.634 1.600 Ammonia Ib/d 5.22 67 77 0.15 20.93 'MM = Avg+1.38SD 'Flow excluded values of 'zero to dataset. Based on Total Del Monte Flow data. 'Used next lower valve as 5 700 noted was probable en -or in sampling as SBOD was only 2.463 on da} in question. 'lased next lower value as 7.500 noted was probable error to sampling or analysis as same da} BOD was only 4 950 The values in Table 2 compare relatively closely to earlier BOD and TSS values of about 5.040 and 1.660 mg/L used for the 1998 season. The impact of the Del Monte load will be rapidly expressed on the treatment plant. The trickling filter will respond right away to the load, as would the activated sludge system. This response will be a combination of oxygen uptake requirements (immediate due to the high soluble loading) and TSS (or MLSS or WAS quantities) on the longer term. To accommodate the variability in loading. biological treatment facilities are designed for maximum sustained loading — typically maximum month. or maximum week. Solids processing units (such as anaerobic digesters) are designed for maximum month loading also. Based on the discussion and data presented above the design loading for the Del Monte wastewater is shown in Table 2. Table 2. Del Monte Wastewater Characteristics for Design. Average' Maximum'' Comment Flow MGD 0.36 0 417 Note 3 BOD mg/L 4.026 4.371 Note 3.4 Soluble BOD mg/L 3.440 3.738 Note 4 TSS mg/L 318 460 Note 4 VSS c7c 95S'r 95% Note 4 Ammonia mg/L 1.8 19.5 Note 4 BOD Ib/d 11.826 15.200 Use 7 -day maximum Soluble BOD Ib/d 10.105 13 000 Calculated value TSS lb/d 933 1.600 Use 7 -day maximum VSS % 95% 95% Average value Ammonia lb/d 5.1 67 8 MM = ANe+1.38SD Average loading can be used to determine operating costs. flow based on Del Monte meter 'Maximum sustained loading. Added to Maximum month for process analysis. 'Flow estimated based on BOD loading (lb/d) and average BOD concentration 'Calculate from mass loading and Flow El ALL 4TIO\ OF FOOD PROCESSING tt 4STE 6 Treatment Plant Loading The Del Monte wastewater is added to the projected treatment plant flows and loads. Since Del Monte operates August through November, the load is added to the plant for the August and October -November periods. The loading established in the Draft Facilities dart (October 2000) is retained for the current and buildout conditions to determine the facility's need to accommodate the growth. Wastewater Treatment Plant Analysis The treatment plant was analyzed to include the proposed Del Monte loading to the plant. The Del Monte flow was blended with the primary effluent. The analyses were done similar to the facilities plan evaluation with the following changes: • The allowable loading to the trickling filter was set to 80 ib BOD/1000 cf/d for monthly loading. During the facilities plan, the limits were set to 65 lb BOD/1000 cf/d. • The MLSS in the aeration basin were increased to 3000 mg/L., compared to 2200 mg/L used in the facilities plan. Due to floating solids on the secondary clarifiers during the pilot study, it is preferable to maintain the MLSS below 3000 mg/L. However. for capacity assessment. the MLSS is allowed to reach 3000 mg/L. • The trickling filter clarifiers in service. Clarifier effluent is pumped to the aeration basins l�r� and settled solids are pumped to the dissolved air flotation thickener. If the trickling filter clarifier is not placed in service. the MLSS in the activated sludge basins increases more than 50% under certain loading conditions and overloads the aeration basin capacity significantly. • The TF bypass was used to reduce the loading to the trickling filters. Based on several calculations, the bypass was configured to send 65% of the plant primary effluent flow to the trickling filters. The Del Monte feed should be directed to the trickling filter with the bypass limited to the plant primary effluent. Loading Without Plant improvements Year 2001 without Intermediate Clarifier Table 3 shows the process loading to the plant under 2001 loading conditions for the three critical months used in the analysis. Annual average and peak hour conditions are listed under the March column. EI 4LL 1TIO\ OF FOOD PROCESSING BASTE 7 Table 3. Process Loading for Year 2001 with Del Monte but without Intermediate Clarifier Unit Proccess Parameter Condition Limit Unit March Aug Oct/Nov Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF Intermediate Clarifiers TF Intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chlorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester OFR OFR OLR OLR OLR OFR HRT MLSS OUR OUR SCFM HRT OFR OFR SLR SLR SLR HRT HRT SLR SLR HRT Digested Sludge Holding Tank HRT Flov, Centrifuge Centrifuge AA -annual average PH -peak hours MM -maximum month MD -maximum da. OFR -overflow rate OLR-organic loading rate HRT -hydraulic retention time AA PH1 Avg MM MD MM Ave MM MD MM MD PH Avg PH Avg MM MD1 Avg PH Avg MM MM MM 1200 gpd/sf 2500 gpd/sf 70 Ib/ 1000cf/d 80 lb/ 1000cf/d 100 lb/ 1000cf/d 2000 gpd/sf 1 hr 3000 mg/L 52 mg/Uh 52 mg/L/h 15.000 scfm 2 hr 600 gpd/sf 1200 epd/sf 24 lb/d/sf 30 lb/d/sf 36 lb/d/sf 60 min 20 min 20 Ib/d/sf 20 lb/d/sf 15 d 4 d MM 200 gpm OpsChoice MM 8 hr/d SCFM-standard cubic feet per minute (air tlou ) MLSS-mixed liquor suspended solids SVI-sludge volume index gpd/sf-gallons per minute per square foot lb/1000cf/d-pounds per 1000 cubic fee t per da} mg/1/h-milligrams per liter per hour lb/d/sf-pounds per dad per square foot 449.1 9514 27.0 28.8 50 6 58.5 41 6 60 1 80.0 2.683 3.377 3.987 32.9 36 1 43 4 244 31.1 34.2 11.111 12.495 14.933 26 365.9 792.5 8.9 10 3 20.5 17 6 15.0 22.8 250 103.3 47.7 41 4.2' 7 6' 9.5' 34.2 27 0 21 9 12 7 10.0 8.1 33 42 42 42 52 12 8 8' 5 6' 7.1' hr/d-hours per da3 lbs/d/sf 24 hours operation gpnt/24hrs/da} operation hours/da at 8hr/d/5dlwk ops SLR — Solids Loading Rate Bold items exceeds capacity The bolded items in Table 3 indicate where the process is exceeding the rated capacity. Based on the calculations, the trickling filter loading rates are maintained just below the targeted 801b BOD/1000 cf/d — which required 10% primary effluent bypass to the activated sludge. The aeration basin loading exceeds capacity for MLSS. The exceedences are significant without the intermediate clarifier in service and will lead to high secondary clarifier sludge blankets and increased aeration basin foaming potential. The secondary clarifier solids loading is not excessively high as long as the SVI remains good, preferably below 150 mL/g. El ALL ATIO.y OF FOOD PROCESSING BASTE 8 E 160 60 40 20 0 8 8 8 8 0 8 0 8 0 0 8 0 0 8 8 8 'dm co M o c� n o r ao T N N r 00 00 Of 01 O O O r T Figure 6. SVI trends during the Fall 2000 pilot study. Figure 6 shows the SVI trend during the pilot study in Fall 2000. The SVI shows a definite trend, increasing during the period to about 130 mlJg. This trend follows the increased loading rate to the trickling filter. Due to this increased loading, the soluble BOD bleeding through the trickling filter increased, providing substrate for the growth of filamentous organisms. This could become problematic as the load increases and the bypass around the trickling filter is increased to maintain the loading to the trickling filter below the target value. Two common control methods can be implemented to prevent filamentous sludge bulking problems. First, chlorination of the RAS should be implemented if the SVI increases above some critical value, typically about 150 mL/g. Second, an anoxic selector basin can be added to provide additional buffering to remove soluble substrate. This will require additional construction and is unlikely to be implemented before the next season. Finally, we recommend that yard piping be arranged so the primary effluent can be bypassed to the aeration basin prior to the addition of industrial waste With this change all the industrial waste can be sent to the trickling filter even when the trickling filter bypass is occurring. 2020 Loading Rates Table 4 shows the process loading to the plant under 2020 loading conditions for the three critical months used on the analysis. No plant improvements are included in this analysis (specifically the trickling filter clarifier is off line). Annual average and peak hour conditions are listed in under the March column. EVALUATION OF FOOD PROCESSING WASTE 9 Table 4. Process Loading for Year 2020 with Del Monte but Without Any Plant Improvements. Unit Proccess Parameter Condition Limit Unit March Aug Oct/Nov Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF Intermediate Clarifiers TF Intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chlorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester Digested Sludge Holding Tank Centrifuge Centrifuge AA -annual aserage PH -peak hours M Nl-maximum month MD -maximum da} OFR-overfloss rate OLR-organic loading rate HRT-hsdrauhc retention time Bold items exceeds capacity OFR OFR OLR OLR OLR OFR HRT MLSS OUR OUR SCFM HRT OFR OFR SLR SLR SLR HRT HRT SLR SLR HRT HRT Flow OpsChoice AA PH Avg MM MD MM Avg MM MD MM MD PH Avg PH Avg MM MD Avg PH Avg MM MM MM MM MM 1200 2500 70 80 100 2000 1 3000 52 52 15,000 2 600 1200 24 30 36 60 20 20 20 15 4 200 8 gpd/sf gpd/sf Ib/1000cf/d Ib/1000cf/d Ib/1000cf/d gpd/sf hr mg/L mg/L/h mg/L/h scfm hr gpd/sf gpd/sf lb/d/sf lb/d/sf lb/d/sf min min lb/d/sf lb/d/sf d d gpm hr/d 712 1,503 42.7 45.2 65.8 4,182 53.0 39.1 17,901 1.7 582 1,247 22.1 25.3 37.3 64.9 30.3 64 6.5 21.8 8.1 52 8.8 64.0 76.3 79.1 110.3 4,436 51.6 43.5 17,862 5,370 63.6 48.6 21,842 42.1 36.6 49.8 55.7 9.7 19.4 7.2 59 9.9 12.6 15.4 5.7 74 12.4 SCFM-standard cubic feet per minute tatr floss MLSS-mixed liquor suspended solids SVI-sludge volume index gpd/sf-gallons per minute per square foot Ib/ I000cf/d-pounds per 1000 cubic fee t per das mg/Vh-milhgrams per titer per hour lb/d/sf-pounds per da} per square foot Fuld -hours per das lbs/d/sf 24 hours operation - gpm/24hrs/da} operation hours/daN at Shr/d/5d/uk ops The bolded items in Table 4 shows the areas where the process is approaching or exceeding the rated capacity. Based on the calculations, the trickling filter loading rates are maintained just below the targeted 80 lb BOD/1000 cf/d: however. the loading is allowed to increase to 1001b BOD cf/d for a maximum day condition. The aeration basin loading exceeds capacity for MLSS and aeration capacity (OUR). The exceedences are relatively small, and the plant may operate satisfactorily for even a few days but there is very little margin for plant upset. Blower capacity is also becoming limited. Secondary clarification and digester capacity are being. exceeded and should be increased. Buildout Loading Rates Buildout loading conditions are the loads anticipated when the current urban growth boundary reaches its maximum density which means all land parcels are occupied. EI 4LL'4TI0\ OF FOOD PROCESSING 44ASTE 10 Table 5 shows the process loading to the plant under buildout loading conditions for the three critical months used on the analysis. No plant improvements are included in this analysis (specifically the trickling filter clarifier is off line). Annual average and peak hour conditions are listed in under the March column. Table 5. Process Loading for Ultimate Buildout Conditions with Del Monte Without Any Plant Improvements. Unit Proccess Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF IntermP:diate Clarifiers TF Intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chlorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester Digested Sludge Holding Tank Centrifuge Centrifuge AA -annual average PH -peak bum> MM -maximum month MD -maximum da} OFR -overflow rate OI R -organic_ loading rate HRT -hydraulic retention nrr Perarrleter I Condition Limit Unit OFR AA 1200 gpd/sf OFR PH 2500 gpd/sf OLR Avg 70 Ib/1000cf/d OLR MM 80 Ib/1000ef/d OLR MD 100 Ib/1000cf/d OFR noon ?non Ypd/sf HRT Avg 1 hr MLSS MM 3000 mg/L 5,179 OUR MD 52 mg/L/h 66.5 OUR MM 52 mg/L/h 49.2 SCFM MD1 15,000 scfm 22,465 HRT PH 2 hr 1.3 OFR Avg 600 gpd/sf 726 OFR PH 1200 gpd/sf 1,551 SLR Avg 24 Ib/d/sf 34.2 SLR MM 30 Ib/d/sf 39.0 SLR MD 36 lb/dist 57.5 HRT Avg 60 min 52.0 HRT PH 20 min 24.4 SLR Avg 20 Ib/d/sf 7.9 SLR MM 20 ib/dist 8 1 HRT MM 15 d 17.5 HRT MM 4 d 6.5 Flow MM 200 gpm 65 March 1 Aua Oct/Nov 886 1.872 53 1 56.2 73.0 81.8 91.7 OpsChoice MM 8 SCFM-standard cubic feet per minute tatr flow hqu r suspcndcd scuds SVI-sludge volume index gpd/sf-gallons per minute per square foot Ib/1000cf/d-pounds per 1000 cubic feet per daN mg/Rh-milligrams per liter per hour Ib/d/sf-pounds per da. per square 1001 5,139 61.8 51.7 21,412 88.4 130.6 6,291 77.0 58.4 26,486 60.4 53.2 73.3 82.8 hr/d 10.9 hr/d-hour: per da‘. lbs/.a/sI 21 hours, operation - gpm/--lhrs/day operation hours/da‘ at Shr/d/id/v, k op: 11.1 14.7 16.3 12.9 6.1 4.8 70 89 11.8 14.9 The bolded items in Table 5 shows the areas where the process is approaching or exceeding the rated capacity. The results identify the same unit processes as under the 2020 loading condition, but the exceedences are more significant Loading With Plant Improvements - Various Phases Year 2001 with Intermediate Clarifier Table 6 shows the process loading to the plant under 2001 loading conditions for the three critical months used on the analysis. Annual average and peak hour conditions are listed in under the March column. Et 4LI AT!O\ OF FOOD PROCESSING ItASTE 11 Table 6. Process Loading for Year 2001 with Del Monte and with Trickling Filter Intermediate Clarifier. Unit Process Parameter Condition Limit Unit March Aug Oct/Nov Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF Intermediate Clarifiers TF Intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chlorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester Digested Sludge Holding Tank Centrifuge Centrifuge AA -annual a\erage PH -peak hours NINI-maximum month MD -maximum das OFR -overflow rate OLR-orgaruc loading rate HRT -hydraulic retenuon time Bold items exceeds capacity OFR OFR OLR OLR OLR OFR HRT MLSS OUR OUR SCFM HRT OFR OFR SLR SLR SLR HRT HRT SLR SLR HRT HRT Flow OpsChoice AA PH Avg MM MD MM Avg MM MD MM MD PH Avg PH Avg MM MD Avg PH Avg MM MM MM MM MM 1200 2500 70 80 100 2000 1 3000 52 52 15,000 2 600 1200 24 30 36 60 20 20 20 15 4 200 8 gpd/sf gpd/sf Ib/1000cf/d Ib/1000cf/d Ib/1000cf/d gpd/sf hr mg/L mg/LJh mg/L/h scfm hr gpd/sf gpd/sf Ib/d/sf Ib/d/sf Ib/d/sf min min Ib/d/sf Ib/d/sf d D Gpm hr/d 450.5 958.3 27.1 28.9 41.8 419.9 2.9 1,506 31.4 23.2 10,603 2.6 365.9 792.4 5.0 5.8 8.4 103.3 47.7 5.1 5.2 31.1 11.5 36.8 6.2 50.8 60.5 660.9 1,916 33.7 28.4 11,669 58.8 80 5 481.1 2.269 40.3 31.3 13.867 11.6 10.0 12.7 14.1 8.1 25.9 9.6 44.2 7.4 10.1 21.1 7.8 54.2 9.1 SCFM-standard cubic feet per minute lair flow MMLSS-mixed liquor suspended solids SVI-sludge volume index gpd/sf-gallons per minute per square toot Ib/I000cf/d-pounds per 1000 cubic tee t per da mgNh-milligrams per hter per hour Ib/d/sf-pounds per day per square toot hr/d-hours per da lbs/d/sf 24 hours operation gpm/24hrs/da} operation hours/dm at 8hr/d/5d/wk ops With the intermediate clarifier in place, the solids loading to the activated sludge process is reduced sufficiently to prevent the solids buildup in the aeration basin above 2,200 mg/L. This makes the loading to the aeration basin much more acceptable. The model is run with the overloaded trickling filter and flow is not bypassed, but sent through the TF. Blower calculations are therefore with the higher trickling filter loading. Unit Process Improvements Beyond 2001 The following discussion is limited to those processes that require increased capacity based on loading. Some facilities are recommended for improvements based on the condition of equipment and other factors as outlined in the Facilities Plan. Septage Handling No change from Facilities Plan. Headworks No change from Facilities Plan. El ALL 4T1OV OF FOOD PROCESS/NG ttASTE 12 Primary Treatment No change from Facilities Plan. Trickling Filters The Facilities Plan recommends replacing the rock media with plastic media. Based on the pilot study results, this replacement is less of an issue from a treatment capacity standpoint. The main issue for handling the Del Monte waste long term is the potential for plugging the media openings. Plastic media will provide significantly better ventilation and air flow. better flushing of the media, and possibly better BOD removal. Soluble BOD removal in the trickling filter will reduce the potential for bulking in the aeration basin. Forced ventilation is required when the trickling filter loading exceeds approximately 112 lb/cf/d loading. While not an immediate process capacity issue. these other factors could improve operability of the trickling filters. We suggest observing the trickling filter performance over the next few years and determine the operational complications, if any arise. The second recommendation in the Facilities Plan is to install mechanical drives on the filter mechanism. This should be done prior to the next canning season. RAST WAS Pumping No change from Facilities Plan. Secondary Clarifier No change from Facilities Plan. The secondary clarifiers are controlled by the hydraulic loading to the plant, which is dominated by the City flow. Based on the hydraulic considerations. the secondary clarifiers should be expanded when the maximum month average flow reaches about 18 mgd which is 2007, or the peak flow reaches 31.5 mgd. The added Del Monte flow will accelerate the implementation of this improvement slightly. Aeration Basins The trickling filter is needed to reduce the MLSS concentration in the aeration basin. Assuming the intermed ate clarifier lc to servire, the MLS grnwc to unacceptable values when the Oct/Nov flow reaches about 16 mgd. The basins also become aeration limited when the flow exceeds 17 mgd in Oct/Nov (since adequate aeration is required all the time, this 17 mgd limit applies to the daily maximum flow or at most a couple days in a row). Projections indicate that in the year 2011 the flow will reach 17 mgd in the months of Oct/Nov. Blower capacity is reached in 2008 pursuant to the DOE/EPA reliability guidelines to have sufficient capacity with one unit out of service. This estimate is based on providing air for maximum day requirements while allowing the dissolved oxygen levels in the aeration basins to fluctuate during peak hour demands. The estimated maximum day air flow requirements in 2008 are 15,000 scfm. The facihty has four blowers rated at 5,000 scfm each. Without any improvements to the trickling filter clarifier, aeration basin improvements are required immediately, and an additional blower will be required in 2006. With improvements to the facility a fifth or redundant blower can be delayed until 2008, the third clarifier in 2007, the fourth aeration hacin m 201 1 and the sixth plower In 2019 El ALL 4T10\ OF FOOD PROCESSING itASTE 13 Disinfection No change from Facilities Plan. WAS Treatment The added Del Monte wastewater will increase the solids handling process load significantly. The waste activated sludge (WAS) dissolved air flotation thickener (DAI-1) thickener solids loading will increase to about 14 lb/sf/d (135 gpm) which is still below the rated capacity of a typical DAFT at (20 lb/sf/d). The DAFT will need to operate 18 hours per day. With polymer addition, the DAFT solids loading rate can be increased. Since solids handling will become a more critical process as capacity margins are reduced, the proposed redundant DAFT should be added in the year 2001 or provisions made for a trailer mounted gravity belt thickener or centrifuge to be rented if the DAFT becomes inoperable. If the existing DAFT becomes inoperable even for a short period of time, the digester design as well as the minimum EPA 503 HRT of 15 days will be exceeded as approximately 200,000 gallons per day of unthickened WAS will be added to the digesters. The digester HRT during the pilot study would have been 11.4 days if the DAF! would have been inoperable during the month of October. Normal WAS flow during August 2000 without the addition of Del Monte wastewater was 25,000 gpd and it was 36,000 gpd during the month of October 2000 with the food processing waste. At 11 days HRT, the requirements for producing EPA 503 Class B Biosolids has been compromised. Anaerobic Digestion The digester capacity will be reached sooner with the Del Monte waste added even with the DA! -1 fully operational. The projected HRT in the digesters will be reduced to 21 days in Oct/Nov by next year (2001) and to 14.9 days by 2020. If the largest digester had been out of service for maintenance in Oct/Nov, the HRT during Fall 2000 with unthickened WAS would have been reduced to 5 days. Solids would not have received adequate digestion nor have met the requirements for land application under current DOE/EPA guidelines. Without Del Monte, the anaerobic HRT is about 18 days in 2020. Prudent planning for solids management at the facility is required during all phases of operation. Before digester hydraulic retention times fall below 15 days a plan needs to be in place for increasing the HRT or utilizing other tankage on the site to store solids when equipment is out of service. Options are: • Increase solids concentration of raw and/or WAS solids by concentrating longer in the primary clarifier or fine tuning the polymer dose on the DAFT. • Isolate one secondary digester for short term retention of WAS or TWAS to provide approximately 220,000 gallons of storage. • Recuperative thicken the digester contents using the existing dewatering centrifuge to increase the digester solids content and increase the HRT. Currently, biosolids dewatering occurs approximately 30 hours per week. During periods of high hydraulic and solids loading to the digesters, the digester contents could be thickened in the dewatering centrifuge from approximately 2% to 4% which will theoretically double the HRT However, to configure the dewatering centrifuge for thickening, the pool depth would have to be mechanically adjusted when switching El 4LL `4T1O.\ OF FOOD PROCESSING WASTE 14 from dewatering to thickening and back. Changing the pool depth requires partial disassembly of the centrifuge and is not practical to do on twice per week basis. • Design and construction of a new digester would be the least favorable option as the tankage would only be used a portion of the year. Even with the current Del Monte loads and current WAS thickening equipment, digester HRT's are not anticipated to be exceeded until the year 2020. Monitoring the growth and loads from the residential. commercial and industrial community during the next 15 years will provide a clearer indication if an additional digester is required to be on-line in the year 2019. Building a digester now for redundancy is not recommended with the options available. Projected Loading Rates With Plant Improvements Table 7 shows the process loadings under 2020 conditions with the facilities proposed in the Revised Facilities Plan. With the added facilities, the WWTF can accommodate the Del Monte wastewater while operating at acceptable loading rates. Under ultimate buildout condition (Tahle 8) the facilities approach capacity, specifically the trickling filter loading. The following Process Capacities were added or their priority was moved forward to accommodate the additional loads from the food processing wastes: • Trickling Filter mechanism with variable speed electric drives — 2001 • Intermediate clarifier and waste sludge pumping station — 2001 • Fifth aeration blower —2008 • Third secondary Clarifier —2007 • Fifth aeration basin volume (2.1 MG) —201.1 • Second centrifuge - 2002 • One anaerobic digester - after 2019 • Sixth aeration blower — 2019 El ALL 4T10\ OF FOOD PROCESSD.G 1, 4STE 15 Table 7. Process Loading for 2020 Conditions with Additional Facilities in Place. Unit Proccess Parameter Condition Limit Unit March Aug Oct/Nov Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF Intermediate Clarifiers TF Intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chlorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester Digested Sludge Holding Tank Centrifuge Centrifuge AA -annual average PH -peak hours MM -maximum month MD -maximum da, OFR-overfloss rate OLR-organic loading rate HRT -hydraulic retention time Et ALL 4 TIO\ OF FOOD PROCESSI.\G R ASTE OFR AA 1200 OFR PH 2500 OLR Avg 70 OLR MM 80 OLR MD 100 OFR MM 2000 HRT Avg 1 MLSS MM 3000 OUR MD 52 OUR MM 52 SCFM MD 15,000 HRT PH 2 OFR Avg 600 OFR PH 1200 SLR Avg 24 SLR MM 30 SLR MD 36 HRT Avg 60 HRT PH 20 SLR Avg 20 SLR MM 20 HRT MM 15 HRT MM 4 Flow MM 200 OpsChoice MM 8 SCFM-standard cubic feet per minute (air t1o« MLSS-mixed liquor suspended sohds WI -sludge volume index gpd/sf-gallons per minute per square foot Ib/I000cf/d-pounds per 1000 cubic tee t per daY Me/Rh-milligrams per titer per hour lb/d/sf-pounds per day per square toot 16 gpd/sf gpd/sf Ib/1000cf/d Ib/1000cf/d Ib/1000cf/d gpd/sf hr mg/L mg/Uh mg/Uh scfm hr gpd/sf gpd/sf Ib/d/sf lb/d/sf lb/d/sf min min lb/d/sf lb/d/sf d d gpm hr/d 716.6 1,518.0 43.1 45.6 66.4 661.9 1.8 1,588 33.8 24.8 17,121 2.5 388.3 831.4 5.6 6.4 94 64.9 30.3 4.0 4.0 26.5 7.4 57.6 9.7 64.5 79.8 1,034.0 1,685 32.7 26.7 16,985 77.0 111.5 748.0 2,048 39.9 29.8 20,576 10.7 9.3 12.4 14.1 5.2 24.7 6.9 61.6 10.4 hr/d-hours per das lbs/d/sf 24 hours operation -gpm/24hrs/das operation hours/da} at Shr/diSdns k ops 6.8 19.8 5.5 77.1 12.9 Table 8. Process Loading for Buildout Conditions with Additional Facilities in Place, Unit Proccess Parameter Condition Limit Unit March Aug Oct/Nov Primary Clarifiers Primary Clarifiers Trickling Filters Trickling Filters Trickling Filters TF Intermediate Clarifiers TF intermediate Clarifiers Aeration Basins Aeration System Aeration System Blower - diurnal peak Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Secondary Clarifiers Chorine Contact Basins Chlorine Contact Basins DAF Thickeners DAF Thickeners Anaerobic Digester Digested Sludge Holding Tank Centrifuge Centrifuge .AA -annual aserage PH -peak hours MINI -maximum month NID-mavmum das OFR-osertloss rate OLR-organic loading rate HRT-hsdrauhc retention ume Et 4L( 4T10\ OF FOOD PROCESSI\G t44STE OFR AA 1200 gpd/sf 891.8 OFR PH 2500 gpd/sf 1,887.0 OLR Avg 70 Ib/1000ct/d 53.5 OLR MM 80 Ib/1000cf/d 56.7 OLR MD 100 Ib/1000cf/d 82 5 OFR MM 2000 gpd/sf 823 4 HRT Avg 1 hr 14 MLSS MM 3000 mg/L 1,975 OUR MD 52 mg/L/h 42.3 OUR MM 52 mg/L/h 31.1 SCFM MD 15,000 scfm 21,451 HRT PH 2 hr 2.0 OFR Avg 600 gpd/sf 484.1 OFR PH 1200 gpd/sf 1,034.0 SLR Avg 24 Ib/d/sf 8.7 SLR MM 30 Ib/d/sf 9 9 SLR MD 36 Ib/d/sf 14.6 HRT Avg 60 min 52.0 HRT PH 20 min 24 4 SLR Avg 20 Ib/d/sf 4 9 SLR MM 20 lb/d/sf 4.9 HRT MM 15 d 21.3 HRT MM 4 d 5.9 Flow MM 200 gpm 71.4 hr/d 12.0 OpsChoice MM 8 SCFbt-standard cubic feet per minute tan- floss NILSS-Waxed liquor suspended solids SV'I-sludge solume index gpd/sf-gallons per minute per square toot Lb/I000cf/d-pounds per 1000 cubic tee t per dm mg/l/h-milligrams per liter per hour Lh/d/sf-pounds per da} per square toot 17 73.5 89.1 92.6 131.9 1.282.0 925.3 1,952 2,400 39.3 48.5 31 9 35.9 20,436 25,012 15.3 13.6 18.2 20.9 6.0 7.9 20.8 16.5 5.8 4.6 73.1 92.3 2.3 15.5 hr/d-hours per das lbs/dist 24 hours operation pmG4hrs/das operation hours/das at Thr/d/5d/ss k op. Summary of Process Analysis • The treatment plant can accommodate the added Del Monte load with the facilities proposed in the Revised Facilities Plan in place. • The main reason that the plant can accommodate the additional loadings is due to the relaxation of the loading criteria on the Trickling Filter as demonstrated during the Fall 2000 testing. Specifically. the increase in the allowable trickling filter loading and MLSS concentrations provide the needed capacity with the addition of the Trickling Filter Clarifier. • If the Del Monte wastewater is added to the wastewater treatment plant. the plant must make special allowances to provide some operator flexibility to accommodate the added load. See discussion beloNA . • The added load increases the mass loading to the plant. The increased BOD load is offset by using the capacity of the trickling filter. However, the added load will increase the energy demand (aeration) and solids handling requirements at the plant. • Note that the facility needs for the month of March are not affected by the Del Monte wastewater contribution. • The activated sludge age was kept at 8.5 days for August and Oct/Nov and at 12 days in March during cold weather (15 C). • All the simulations were done based on the existing rock trickling filter performance. The trickling filter performed well at the higher loading rates. largely because the majority of the higher load comes from the readily degradable soluble Del Monte wastewater. As indicated above, the treatability coefficient for the Fall 2000 data is very high for the rock media. It is doubtful that plastic media will significantly increase the trickling filter performance for BOD removal. The plastic media will improve the flushing of solids, void fraction (and therefore air supply), and ability to remove excessive biological growth with fewer horizontal areas where growth can accumulate. From a treatment capacity perspective, the change to plastic media does not seem warranted even through the year 2020. However. the plant may experience operational difficulties from the trickling filters associated with solids accumulation that could be improved by changing to plastic media. EL ALL 4T1O\ OF FOOD PROCESSING li4STE 18 Comments on C11211/1 -Hill Report - January 2001 Del Monte Wasteload Table 9 shows a comparison between our load assessment and the CH2M-Hill load assessment. The loading is reasonably similar, except for TSS values that were adjusted based on particulate BOD values as discussed earlier. Table 9. nes Monte Wastewater Characteristics for Design. Flow BOD Soluble BOD TSS VSS Ammonia BOD Soluble BOD TSS VSS Ammonia CH2M-Hill report a range. This value is the high limit. Lower limit about 5-10% below high limit. MGD mg/L mg/L mg/L mg/L inbQ lb/d lb/d lb/d HDR Averages 0.36 4,026 3,440 318 95% 1.8 1i1,826 10,105 933 95% 5.2 HDR CH2M-Hill CH2M-Hill Comment Maximum2 Monthly Weekly 0.417 0.37 0.40 4,371 4,200 4,700 3,73g 3,500 460 1,000 1,200 95% 95% 95% 5.5 <2 <2 nn 3 i 15,200 13,000 1,600 95% 67 8 1')'nn 10,400 4,000 95% <5 13,900 11,600 3,700 95% <5 Waste Sludge Yield Increase Our calculations showed a yield from the data of 0.46 lb TSS/lb BOD removed based on total BOD in rrunus soluble BOD out. Overall, our calculations result in a combined yield of just below 0.61b TSS/lb total BOD removed. Del Monte load the wastewater treatment would When assessing the impact ()I the luau on vJa�wwuu.i plant it would more accurate to calculate the yield of the Del Monte wastewater based on standard biological treatment techniques. Ultimately, when the wastewater is oxidized one would still anticipate a net yield on the order of 0.50 — 0.65 lb TSS/lb BOD removed. This would project an increase of approximately 6,000 — 9,000 lb TSS/d from the Del Monte wastewater under various loading conditions, The pilot study showed a WAS production of approximately 8,100 to 10,900 lb TSS/d before and after October while the primary effluent load remained about 14,200 lb BOD/d (see cumulative plot in Figure 7 below). This gives a yield somewhere between 0.56 and 0.77 lb TSS/lb BOD. Note that these overall yield values are significantly higher that the 0.19 lb TSS/lb BOD removed in the CH2M-Hill report or the 0.57 lb TSS/lb BOD in the CH2M-Hill model. Solids production is a critical aspect of the treatment plant as low estimates of the solids production lead to inadequate solids handling facilities and undesirable solids buildup ,i i _ VT_ therefore re to , conservative es"' to of the e pected sludge ill the plant. VV G LL1GrG1V1G prefer use a CviiSer`v uu r.. vu w .,..1,.,�-�- .,----a- production value. Underestimating solids production will increase long term operational headaches. EVALUATION OF FOOD PROCESSING WASTE 19 2,500,000 2,000,000 1,500,000 — 1,000,000 500,000 0 L Slope - 14,200 Ib BOD/d PE Overall "Yieldl" = 0.57 Ib TSS/Ib BOD 'Yield2" = 0.77 Ib TSSAb BOD 7/13/00 ISIope2 - 10,900 Ib TSS/d out 8/2/00 8/22/00 9/11/00 Slopel - 8,100 Ib TSS/d out 10/1/00 -4— Cum P E —f-CumWAS I 10/21/00 11/10/00 11/30/00 Figure 7. Cumulative pilot of primary effluent BOD and WAS during pilot study. October- shows a sharp increase in WAS production. Accommodating the Del Monte Wastewater If the Del Monte wastewater is sent to the treatment plant on a regular basis, it would be desirable to provide operator flexibility to accommodate the industrial wastewater. Some of these facilities include the following: • Provide an option to direct 100% of the Del Monte flow to the trickling filter, even when the primary effluent is bypassed around the trickling filter. • Provide facilities for bulking control. These could include an anoxic selector and the ability to add chlorine to the RAS for bulking control. RAS chlorination should become part of the standard operating procedure to maintain SVI's at acceptable levels. When and if the plant elects to change the effluent disinfection system from chlorine gas to UV light, then RAS chlorination can be maintained by using liquid sodium hypochlorite, the same chemical used in the packed towers odor scrubbers. • Continue alkalinity addition and pH control at the Del Monte pretreatment plant. • The treatment plant may not be able to accommodate significant load fluctuations. It is therefore important to minimize the load fluctuations from Del Monte. It is important to reduce these excursions as much as possible. EVALUATION OF FOOD PROCESSING WASTE 20 • While the Fall 2000 testing demonstrated the treatment capacity of the liquid treatment facilities, it is unclear what the impact of the added load on the solids treatment facilities will be. Potential impacts were quantified in this analysis based on the data collected during the Fall 2000 season. Special attention will have to be paid to the solids processing facilities to assess any unknown impacts. The impact on solids processing facilities needs to be monitored through the winter months. There have been operator indications that the digested sludge does not dewater as well when compared to the sludge characteristics prior to the introduction of the food processing waste. • No nutrient deficiency was noted in the Fall 2000 season. However, special attention should be paid during the next few seasons to detect nutrient impacts. • Flushing the trickling filters are important with the highly soluble wastewater. The trickling filter drives should be modified to provide control over the rotational speed. In addition, the drives controls should be designed to provide the flexibility to accommodate heavy flush periods for biofilm growth control. Schedule If the food processing waste is to be treated by the Yakima WWTF in the summer/fall of 2001 the following items are recommended for immediate improvement: • The trickling filter mechanisms need to be upgraded to provide control over the rotational speed so the rock media can be flushed. o As has been the experience during past construction projects when the trickling filters have been take out of service, a minimum of two to four weeks between starting one up and taking the other one out of service is normally required. o To be ready for the canning season, the trickling filter construction should be completed by the middle of July to allow the filters to build a biomass. • Provisions to thicken the WAS with rental equipment if the DAFT or associated equipment require maintenance should be anticipated. Potential solutions would be to rent a trailer mounted gravity belt thickener or thickening centrifuge for the canning season. The critical link in processing the food waste is the solids handling system. A failure in any portion of the system will lead to long term operational problems and permit violations. Replacing the inoperable Bird centrifuge with a high solids handling machine that is capable of being converted to a thickening mode would reduce the necessity of providing backup rental equipment. • Trickling filter clarifier rehabilitation with sludge pumping facilities to the DAFT should be in place for the 2001 canning season to reduce the potential of overloading the activated sludge aeration basins. El ALL' -17-104. OF FOOD PROCESSING 14 ASTE 21