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STRATEGIC OUTCOMES |
ACTION |
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Department: |
☒ Safe & Prosperous |
☒ Motion |
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Utilities |
☐ Active & Appealing |
☐ Resolution |
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☐ Respected & Responsible |
☐ Ordinance - Introduction |
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Division: |
☐ Connected & Engaged |
☐ Ordinance - Adoption |
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Administration |
☐ Unique & Creative |
☐ Public Hearing |
TITLE:
title
Notice of Intention to Adjust Water and Wastewater Utility Rates
end
SUMMARY RECOMMENDATION:
Summary Recommendation
Adopt a Notice of Intention pursuant to A.R.S. § 9-511.01 to increase water and wastewater rates, reinstate the Water Resource Trust Fund surcharge, and set a public hearing on the proposed rate increase. (Utilities/Administration) (Jeremy McCall)
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STRATEGIC OUTCOME:
This action item supports the City Councils strategic outcome of Safe and Prosperous by ensuring the future reliability and quality of the City’s water and wastewater systems.
REPORT:
The City of Yuma Utilities Department proposes to increase water and wastewater utility rates as a result of the 2023 Integrated Master Plan and the 2023 Water and Wastewater Rate Study and Long Term Financial Plan findings.
The City of Yuma’s last evaluation of water and wastewater rates occurred in 2014. The 2014 rate study recommended implementing a five-year rate plan which, began in 2015 and ended in 2019. In January 2015, City Council approved the adoption of Resolution R2015-02, which established water and wastewater rates.
The City has not adjusted water and wastewater rates since January of 2019. In 2023, the Utilities Department completed an Integrated Master Plan evaluation, which assessed the utilities operational and capital infrastructure needs. The master plan identified the need to revise and increase utility rates to meet the future fiduciary requirements of the utility. The Utilities Department contracted with Willdan Financial Services to independently evaluate the financials of the utility and make recommendations if needed. The 2023 Water and Wastewater Rate Study and Long-term Financial Plan recommended the adoption of a new rate plan that incorporates annual adjustments over the next five years.
The Utilities Department proposes establishing new water and wastewater rate charges as identified by both the 2023 Utility Rate Study and 2023 Integrated Master Plan.
Additionally, it is recommended to reinstate the Water Resource Trust Fund Surcharge. Several Federal reservoir and water management decisional documents and agreements that govern the operation of the Colorado River facilities and management of the Colorado River are scheduled to expire in 2026. These include the U.S. Bureau of Reclamation 2007 Interim Guidelines to provide shortage guidelines for the Colorado River and coordinating criteria for operating Lake Powell and Lake Mead (2007 Interim Guidelines), the 2019 Drought Contingency Plans (DCP), as well as international agreements between the U.S. and Mexico entered into via the 1944 Water Treaty with Mexico. The post-2026 process has already begun and the City of Yuma needs to engage, educate, and possibly litigate, to protect its current water rights. The Yuma City Council created the Water Resources Trust Fund Surcharge in 1988 through Resolution R2558. Reinstating the modest surcharge will generate revenues for a restricted fund used to protect Yuma’s water supply assets.
A.R.S. § 9-511.01 requires City Council to adopt a Notice of Intention to increase water or wastewater rates, rate components, fees, or service charges at least sixty (60) days prior to holding a public hearing on the proposed increase. In addition, the Notice of Intention must be published at least once in a newspaper of general circulation within the boundaries of the municipality not less than twenty (20) days prior to the public hearing.
Attached is a copy of the Notice of Intention, which states the City will conduct two public hearings on the proposed increase in water and wastewater rates and reinstatement of the Water Resource Trust Fund Surcharge at the following dates and locations:
1. January 16, 2024, at 5:00 p.m., Water and Sewer Commission meeting, Thomas F. Allt Utilities Complex Training Room, 270 W. 13th Street, Yuma, Arizona 85364.
2. January 17, 2024, at 5:30 p.m., City Council meeting, City Council Chambers, One City Plaza, Yuma, Arizona 85364.
If adopted by City Council, a copy of the Notice of Intention will be published in the Yuma Sun on November 19, 2023, and again on December 9, 2023. A copy of the 2023 Utility Rate Study and 2023 Integrated Master Plan will be on file with the City Clerk and available to the public via the City’s website. The reports will also be available for review at the Utilities Department, 270 W. 13th Street, Yuma, Arizona 85364.
FISCAL REQUIREMENTS:
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CITY FUNDS: |
$ 0.00 |
BUDGETED: |
$ 0.00 |
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STATE FUNDS: |
$ 0.00 |
AVAILABLE TO TRANSFER: |
$ 0.00 |
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FEDERAL FUNDS: |
$ 0.00 |
IN CONTINGENCY: |
$ 0.00 |
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OTHER SOURCES: |
$ 0.00 |
FUNDING: ACCOUNT/FUND #/CIP |
TOTAL $ 0.00
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To total; right click number & choose “Update Field” |
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FISCAL IMPACT STATEMENT:
NONE
ADDITIONAL INFORMATION:
SUPPORTING DOCUMENTS NOT ATTACHED TO THE CITY COUNCIL ACTION FORM THAT ARE ON FILE IN THE OFFICE OF THE CITY CLERK:
1. 2023 Utility Rate Study
2. 2023 Integrated Master Plan
IF CITY COUNCIL ACTION INCLUDES A CONTRACT, LEASE OR AGREEMENT, WHO WILL BE RESPONSIBLE FOR ROUTING THE DOCUMENT FOR SIGNATURE AFTER CITY COUNCIL APPROVAL?
☐ Department
☐ City Clerk’s Office
☐ Document to be recorded
☐ Document to be codified
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Acting City Administrator: |
Date: |
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John D. Simonton |
11/06/2023 |
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Reviewed by City Attorney: |
Date: |
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Richard W. Files |
11/03/2023 |