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Title:
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Approval of Method of Providing Refunds on the Sewer User’s Service Charge for Fiscal Year 2010/2011.
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City of Culver City, California
Agenda Item Report
Meeting Date: 08/23/2010 Item Number: A-1
CITY COUNCIL AGENDA ITEM: Approval of Method of Providing Refunds on the
Sewer User’s Service Charge for Fiscal Year 2010/2011
Contact Person/Dept.: Mate Gaspar/PW Phone Number: 310-253-5602
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [] Attachments: []
Commission Action Required: Yes [] No [X] Date: _______________
Public Notification: (E-Mail) Agenda and Meetings – City Council (08/18/2010)
Department Approval:
Charles D. Herbertson(08/12/10)
City Attorney Approval:
Carol Schwab (by H. Baker) (08/18/10)
Chief Financial Officer Approval:
Jeff Muir (by. M. Noller) (08/18/10)
City Manager Approval:
John M. Nachbar (08/18/10)
RECOMMENDATION:
Staff recommends the City Council approve providing the sewer user service charge
refund amount as a credit (deduction) in Fiscal Year’s 2011/2012 sewer user service
charges. Also, for parcels where sewer user service charges would have been
higher because their water consumption was greater in 2009 than in 2008, then that
additional incremental amount not captured in this year’s charges be added to next
fiscal year 2011-12 charges.
BACKGROUND:
On June 14, 2010, the City Council approved the Engineer’s Report and confirmed
the existing rates and ordered the annual assessment levy for the Sewer User’s
Service Charge in an amount equal to last year’s rate for Fiscal Year 2010/2011.
At that time Golden State Water Company (GSWC) informed the City in writing that
they would no longer provide the water consumption data for each parcel. GSWC
stated that they consider the water consumption data to be private and that the
California State Public Utilities Commission (CPUC) has not directed them to
release it.
Therefore, the City Council approved staff’s recommendation that the water
consumption data from the 2008 calendar year used to calculate the Fiscal Year
2009/2010 sewer charges be used to calculate the Fiscal Year 2010/2011 sewer
user service charges. Property owners would still be entitled to refunds if they
could provide GSWC billings that show their water consumption is less than the
previous year. The City Council also directed staff to notify all property owners by
letter that they are entitled to a refund if they can prove lower water consumption in
2009 than in 2008. City of Culver City, California
Agenda Item Report
DISCUSSION:
GSWC has informed staff that the California Public Utilities Commission has issued
an Advice Letter dated July 26, 2010 (1403-WA) that allows them to release water
consumption data to local agencies. The local agency must sign a non-disclosure
agreement with GSWC certifying that this information is available to city employees,
consultants or agents only on a “need-to-know” basis. Also, any city employees,
consultants or agents given access to this information are bound by this agreement’s
confidentiality standards. The City Attorney's Office has reviewed the non-disclosure
agreement and advised that it can be executed.
Staff requested that the Los Angeles County Assessor’s office extend the deadline
to submit the sewer user service charges from August 10 to September 10 so that
they could be calculated with 2009 water consumption data. The Assessor’s Office,
however, only approved an extension to submit property tax data from August 10 to
August 20. As a result, the City consultant, Karen Scott and Associates does not
have the time to calculate the sewer charges using the 2009 water consumption
data.
With approximately 12,727 parcels in the City being charged a sewer user service
charge and informing each property owner that they may be entitled to a refund if
they prove that water consumption in 2009 is less than in 2008, staff believes there
would be a large number of requests for refunds submitted to the City after the
property tax bill is released in late September.
In lieu of the above, staff recommends the City Council approve providing any
adjustments required by applying the 2009 water consumption data to next year’s
calculation when the annual Engineer’s Report is prepared. This would avoid the
significant expense of issuing individual refund checks or supplemental bills.
FISCAL ANALYSIS:
It is estimated that the Sewer User Service Charge revenue for Fiscal Year 2010-
2011 will be $8,104,500.
If the City Council directs that refunds be available to property owners by a check
and not by a credit on next year’s bill, it is estimated that it will take two hours
(Engineering and Accounting) to verify and prepare each refund check. Depending
on the number of refund requests, this could require an extensive amount of staff
time that will take time away from other functions. In a typical year, an average of
five refund checks are processed due to matters such as the property owner proving
that there was a water leak not entering into the sewer system or a change in
business use.
City of Culver City, California
Agenda Item Report
MOTION:
That the City Council:
1A. (Staff recommendation) Authorize the use of the 2009 water consumption
data during the preparation of next year’s annual Engineer’s Report for the
Sewer User Service Charge (which will result in a one-time adjustment to the
Sewer User Service Charge in Fiscal Year 2011/2012;
OR
1B. Direct staff to perform the revised calculation and issue refund checks where
appropriate (and include any increases to accounts with increased water usage
next year during the preparation of the Engineer’s Report)