Notice of Proposed Rate Increase & Proposed Changes to Ordinance 2013-01
Notice of Proposed Rate Increase & Proposed Changes to TRID Ordinance 2013-01
Public Comment Meetings April 13 & May 17, 2022, 8:30am, via Zoom
For the fourth year in a row, the Board proposes to keep water rates the same for FY2022-2023. The snow removal fee will also remain unchanged. So once again, there will be no increase in water rate or snow removal services. The Board proposes to increase the system replacement fee (SRF) by $10.00 per quarter, from $75.00 to $85.00. This works out to an increase of $40.00 per year or $3.33 per month. The SRF has not been increased in 14 years.
Every five years, the Board is required to have a reserve study performed. TRID currently has $1,200,000 in reserves. This summer, we anticipate the following work being done with approximated costs, primarily in system reliability upgrades: a surge analysis study ($2,000); three flow meters ($10,000); a transfer switch ($3,500); two SCADA units (supervisory control and data acquisition-$5,000); replacement of one of the two pumps at the Washoe well ($25,000); and a continuation of the fire hydrant upgrade project. We need a generator at the pump station which has been ordered, but delivery is backed up and not expected for 40 weeks, pushing this project to the summer of 2023 (permits, generator and noise attenuation $60,000). Replacement of the Skyline tank ($150,000) has also been pushed to the summer of 2023.
Browning Reserve Group, the firm who assesses the financial health of our reserves (and many water companies), estimated in its 2020 study that the Board will have a deficit of $1,900,000 by 2050 if we keep our system replacement fee at the current rate of $75 per quarter. Browning suggested that we raise the SRF by at least 3.4% annually in order to maintain a healthy reserve. If we raise the SFR by that minimum, each year, we would be left with only $227,387 in reserves by 2050.
Rather than re-do the SFR each year to increase the system replacement fee, we propose to raise the rate by $10.00 per quarter ($40.00/year or $3.33/month). The next reserve study will be performed in 2025, when we will revisit the SRF to see how well we have done.
The Board strives to be financially prudent and conservative, while proactively maintaining and improving the components of our water system. TRID has no debt service as we have never incurred the expense of floating a bond to cover the cost of improvements.
Any time TRID raises rates, we must comply with legal requirements which include posting 2 rounds of notices in the Sierra Sun ($400 each), mailers to our customers, holding 2 public hearings, responding to all comments from both hearings, recalculating the proposed rates if appropriate, and finally adopting a new Schedule A for rates found in our ordinances. This process takes a minimum of 3 months, is labor intensive, and costs TRID approximately several thousand dollars in staff time, newspaper notices, and postage. Your board members receive no compensation for their time or work.
Our current SRF generates $102,600 per year. Over the course of the next three fiscal years, this would generate $307,800 at the current rate. The suggested minimum annual increase of 3.4% over the next three years would generate $329,218.04, or an additional $21,418.04. Raising the SRF to $85/quarter would generate $348,840 over the next three fiscal years, or an additional $41,040.
The math starts with two assumptions: (1) we have 342 customers and (2) billing is done quarterly (which also helps keep our costs down).
Current System Replacement Fee over next 3 fiscal years raises $307,800:
($75.00/quarter) x (342 customers) x (4 quarters/year) = $102,600/year
$102,600/year x 3 years = $307,800 raised.
A 3.4% annual increase in the SRF over the next 3 fiscal years raises $329,218.04:
2022-23: ($75.00 x 1.034)[1] x (342 customers) x (4 quarters/year) = $106,088.40
2023-24: ($77.55 x 1.034)[2] x (342 customers) x (4 quarters/year) = $109,699.92
2024-25: ($80.19 x 1.034)[3] x (342 customers) x (4 quarters/year) = $113,429.72
$106,088.40 + $109,699.92 + $113,429.72 = $329,218.04
A $10/quarter increase in the SRF over the next 3 fiscal years raises $348,840:
($85/quarter) x (342 customers) x (12 quarters) = $348,840
Proposed Changes to TRID Master Ordinance 2013-01
The Talmont RID proposes to add the requirements of SB 998 as Section 7.26
7.26 Procedures for Termination of Service for Non-payment:
7.26.1 The District shall not discontinue residential service for nonpayment until a payment by a customer has been delinquent for at least 60 days.
7.26.2 No less than seven business days before discontinuation of residential service for nonpayment, the District shall contact the customer by telephone, written notice to the address provided by the customer, and by e-mail if the customer provided an e-mail address to the District.
7.26.3 When the District contacts the customer by telephone, it shall offer to provide the customer with the District’s written policy on discontinuation of residential service for nonpayment. The District shall offer to discuss options to avert discontinuation of residential service for nonpayment, including, but not limited to, alternative payment schedules, deferred payments, minimum payments, procedures for requesting amortization of the unpaid balance, and petition for bill review and appeal.
7.26.4 The written Notice of Delinquency and Impending Termination of Service shall be mailed to the customer’s address of record that was supplied by the customer. If the customer’s address is not the address of the property to which residential service is provided, the notice also shall be posted to the address of the property to which residential service is provided, addressed to “Occupant.”
7.26.5 The notice shall include, but is not limited to, all of the following information in a clear and legible format:
- The customer’s name, billing address, and service address.
- The amount of the delinquency.
iii. The date by which the payment or arrangement for payment is required in order
to avoid discontinuation of residential service.
- A description of the process to apply for an extension of time to pay the
delinquent charges.
- A description of the procedure to petition for bill review and appeal.
- A description of the procedure by which the customer may request a deferred,
reduced, or alternative payment schedule, including an amortization of the
delinquent residential service charges, consistent with the written policies provided
pursuant to subdivision (a) of Health and Safety Code section 116906.
7.26.6 If the District is unable to make contact with the customer by phone, or with an adult occupying the residence by telephone, and written notice is returned through the mail as undeliverable, the District shall make a good faith effort to visit the residence and leave, or make other arrangements for placement in a conspicuous place of, a notice of imminent discontinuation of residential service for nonpayment and the District’s policy for discontinuation of residential service for nonpayment.
7.26.7 If the customer or an adult at the residence appeals the water bill to the District or any other administrative or legal body to which such an appeal may be lawfully taken, the District shall not discontinue residential service while the appeal is pending.
7.26.8 The District shall not discontinue residential service for nonpayment if all of the following conditions are met:
- The customer, or a tenant of the customer, submits to the District the certification of a primary care provider, as that term is defined in subparagraph (A) of paragraph (1) of subdivision (b) of Section 14088 of the Welfare and Institutions Code, that discontinuation of residential service will be life threatening to, or pose a serious threat to the health and safety of, a resident of the premises where residential service is provided.
- The customer demonstrates that he or she is financially unable to pay for residential service within the District’s normal billing cycle. The customer shall be deemed financially unable to pay for residential service with the District’s normal billing cycle if any member of the customer’s household is a current recipient of CalWORKs, CalFresh, general assistance, Medi-Cal, Supplemental Security Income/State Supplementary Payment Program, or California Special Supplemental Nutrition Program for Women, Infants, and Children, or the customer declares that the household’s annual income is less than 200 percent of the federal poverty level.
iii. The customer is willing to enter into an amortization agreement, alternative payment schedule, or a plan for deferred or reduced payment, consistent with the written policies provided pursuant to subdivision (a) of Health and Safety Code section 116906, which respect to all delinquent charges.
7.26.9 If the conditions listed in subsection 7.26.8 are met, the District shall offer the customer one or more of the following options:
- Amortization of the unpaid balance.
- Participation in an alternative payment schedule.
iii. A partial or full reduction of the unpaid balance financed without additional charges to other ratepayers.
- Temporary deferral of payment.
7.29.10 The District may choose any of the payment options described above and may set the parameters of that payment option. Ordinarily, the repayment option offered should result in repayment of any remaining outstanding balance within 12 months. The District may grant a longer repayment period if it finds the longer payment period is necessary to avoid undue hardship to the customer based on the circumstances of the individual case.
7.29.11 Residential service may be discontinued no sooner than 5 business days after the District posts a final notice of intent to disconnect service in a prominent and conspicuous location at the property under either of the following circumstances:
- The customer fails to comply with an amortization agreement, an alternative payment schedule, or a deferral or reduction in payment plan for delinquent charges for 60 days or more.
- While undertaking an amortization agreement, an alternative payment schedule, or a deferral or reduction in payment plan for delinquent charges, the customer does not pay his or her current residential service charges for 60 days or more.
iii. The district shall make a reasonable good faith effort to contact an adult person residing at the premises of the customer by telephone or personal contact at least 48 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the District shall give, by mail, in person, or by posting in a conspicuous location at the premises, a notice of termination of service, at least 48 hours prior to termination. Every notice of termination of service pursuant to this section shall include the items of information in the paragraphs above.
[1] $75.00 x 1.034 = $77.55
[2] $77.55 x 1.034 = $80.19
[3] $80.19 x 1.034 = $82.92
