Rancho Palos Verdes City Council
   

TO: HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL

FROM: DIRECTOR OF PUBLIC WORKS

DATE: JULY 15, 2003

SUBJECT: ABALONE COVE SEWER MAINTENANCE FEE

Staff Coordinator: Glen W.C. Kau, Sr. Engineer

RECOMMENDATIONS:

  1. Conduct a public hearing on the proposed levy and allocation of the annual sewer service charge for the Abalone Cove Sewer System for Fiscal Year 2003-04.
  2. Authorize a $17,500 subsidy of the annual Abalone Cove sewer service charge.
  3. Adopt Resolution No. 2003-_____, a Resolution of the Council of the City of Rancho Palos Verdes approving the report in connection with the sewer service charge established pursuant to Chapter 13.06 of the Rancho Palos Verdes Municipal Code, determining the amount of such charge for Fiscal Year 2003-04, and ordering such charge to be collected on the tax roll.

BACKGROUND

To insure a flow of funds for the on-going operation and maintenance of the sewer facilities in the Abalone Cove area, the City Council established the Abalone Cove Sewer Service Charge on July 17, 2001. This Sewer Maintenance Fee ensures a fair and equitable levying of the necessary costs of operating and maintaining of the facilities.

The City Council annually reviews the current and projected year's costs for the operation and maintenance of the sewer facilities and sets the rates for the ensuing fiscal year, which runs between July 1 and June 30. In setting the annual rates, the City Council will consider any new or updated maintenance costs, and any fund balances or shortages, and adjust the rates accordingly.

The Abalone Cove Sewer Service Charge is levied under the authority of the California Health and Safety Code, Sections 5471 et seq. (the "Code"). Payment of the charge for each parcel will be made in the same manner and at the same time as payments are made for property taxes for each property.

To levy the sewer charge for fiscal year 2003-2004, the City must hold a public hearing. The attached Engineer’s report was prepared to determine the amounts. This report estimates the annual operating costs of the Abalone Cove sewer system and the corresponding fee charge for each property.

ANALYSIS

The estimated annual cost to maintain the Abalone Cove sewer system for FY 2003-04 is $52,221. This amount is slightly less than the budgeted amount for FY 2001-02 and FY 2002-03:

FY 2001-02

FY 2002-03

FY 2003-04

Actual

Actual

Proposed

District Costs

$56,595.00

$56,595.00

$52,221.00

-

 

 

 

City Subsidy

$35,000.00

$35,000.00

$17,500.00

= Total Fee

$21,595.00

$21,595.00

$34,721.00

When the Abalone Cove Sewer Service Charge was established, the City Council agreed to have the City subsidize sewer maintenance in an effort to reduce fees to property owners and to bring uniformity to the annual service charges. The City annual subsidy for FY 2001-02 and FY 2002-03 was $35,000. The City subsidy is reviewed each year and may be reduced, altered, or otherwise discontinued as the City Council deems appropriate.

During the most recent budget process, the City Council requested staff to reduce the City subsidy by 50 %, to $17,500. The reduction in subsidy will result in increased fees to property owners.

The FY 2003-04 Engineer’s Report groups parcels in the Abalone Cove sewer service area into various rate zones based on the specific combination of sewer subsystems utilized by each parcel. The proposed FY 2003-04 fees for a single family parcel ranges from $127.13 to $418.28. For all parcels in the Abalone Cove sewer service area, the FY 2003-04 fee is greater than the FY 2002-03 fee, but is not higher than the maximum charges authorized pursuant to Section 13.06.070 of the City’s Municipal Code. A description of the various zones and their historic and proposed fees are as follows:

Property Owner Fees:

FY 2001-02

FY 2002-03

FY 2003-04

% Increase

FY 2003-04

Actual

Actual

Proposed

 

 

 

(w/$17,500 Subsidy):

 

(w/o City Subsidy):

Zone A

$ 119.07

$ 119.07

$ 127.13

7%

$ 206.86

Zone B

$ 209.15

$ 209.15

$ 327.84

57%

$ 452.57

Zone C

$ 129.71

$ 129.71

$ 172.57

33%

$ 363.35

Zone D

$ 219.79

$ 219.79

$ 418.28

90%

$ 609.06