HomeMy WebLinkAboutResolution No. 2023-62 | Adjust Water and Wastewater Rates | Adopted 10/16/2023
RESOLUTION NO. 2023-62
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY
ESTABLISHING THE CITY’S WATER AND WASTEWATER UTILITY
SERVICE RATES EFFECTIVE JANUARY 1, 2024, AND ADJUSTED
ANNUAL ON JANUARY 1 FOR EACH SUBSEQUENT FISCAL YEAR
THEREAFTER THROUGH FISCAL YEAR 2027-28
WHEREAS, the City of Gilroy has identified ongoing operational and capital needs
associated with the City’s water and wastewater utility system; and
WHEREAS, in order to fund the identified water and wastewater system’s
operational and capital costs, it is necessary to adjust the City’s current water and
wastewater rates; and
WHEREAS, the City of Gilroy engaged NBS Government Finance Group, a firm
with expertise in the analysis of costs relating to utilities, to conduct a rate study of the
City’s water and wastewater utilities; and
WHEREAS, the City Council received the report prepared by NBS Government
Finance Group at the August 21st, 2023, City Council meeting and heard from staff on
this matter; and
WHEREAS, on November 5, 1996, California voters approved Proposition 218,
requiring specific procedures be followed with regard to “property -related” fee increases,
including the need to provide written notice at least 45 days in advance of a public hearing;
and
WHEREAS, pursuant to California Constitution Article XIIID, which is commonly
known as Proposition 218, the City gave at least 45 days’ notice of the time and place of
the public hearing set before the City Council by causing to be mailed the said notice with
instructions on the proper method for submitting a protest , postage prepaid, to all owners
of property subject to the City's water and wastewater utilities system rate schedule, and
to all water and wastewater utility customers on August 28, 2023; and
WHEREAS, on August 21, 2023, the City Council adopted Resolution 2023-49
setting October 16, 2023, as the date for the public hearing for consideration of the water
and wastewater rate adjustments.
WHEREAS, pursuant to law, if a majority of the owners of property subject to the
proposed water and wastewater utilities system rates file valid protests to the
proposed rate, then the City Council may not adopt the new rate ; and
WHEREAS, the City Council has received and duly considered all written and
verbal comments provided to it by staff and the public, which comments are hereby
incorporated into the record on this matter; and
Resolution No. 2023-62
Adjust Water and Wastewater Rates with Proposition 218 Hearing and Notice Authorization
City Council Regular Meeting | October 16, 2023
Page 2 of 4
WHEREAS, the number of protests compared to the number of parcels currently
receiving water and wastewater services from the City is less than 50%.
NOW, THEREFORE THE CITY COUNCIL OF THE CITY OF GILROY DOES
RESOLVE AS FOLLOWS:
1. The purposes of the fees and reserves set forth herein are to finance the water
and wastewater utilities system costs.
2. The facts and evidence presented to the City Council establish that the cost
determinations set forth in the NBS rate study are reasonable and proportional,
and the fees expected to be generated will not exceed those reasonable and
proportional costs.
3. The City Council hereby adopts the adjusted water and wastewater rate schedule,
the reserve fund targets, and the rate study report. The rates are show in Exhibit
“A”, which is attached hereto and incorporated by reference to be effective for each
monthly cycle beginning on or after January 1, 2024, January 1, 2025, January 1,
2026, January 1, 2027, and January 1, 2028, as described in the Exhibit “A”.
PASSED AND ADOPTED at a Regular Meeting of the City Council on this 16th
day of October 2023 by the following vote:
AYES: COUNCIL MEMBERS: ARMENDARIZ, BRACCO, MARQUES,
TOVAR, BLANKLEY
NOES: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
ABSENT: COUNCIL MEMBERS: CLINE, HILTON
APPROVED:
Marie Blankley, Mayor
ATTEST:
_______________________
Thai Nam Pham, City Clerk
Marie Blankley (Nov 6, 2023 10:19 PST)
Marie Blankley
Resolution No. 2023-62
Adjust Water and Wastewater Rates with Proposition 218 Hearing and Notice Authorization
City Council Regular Meeting | October 16, 2023
Page 3 of 4
EXHIBIT A
Wastewater Rates
Wastewater revenues pay for the operations and maintenance of the collection system (pipes and pump
stations that transport the wastewater from homes and businesses to the wastewater treatment plant)
and the administrative and regulatory costs to run the system. The treatment plant is operated by the
South County Regional Wastewater Authority (SCRWA), a Joint Powers Authority (JPA) whose members
are the cities of Gilroy and Morgan Hill. A portion of the wastewater revenues collected by the City is used
for payments to SCRWA. In addition, wastewater rates support infrastructure investments, such as
necessary system repairs and renovations to meet new regulations.
The residential wastewater service rates consist of fixed monthly charges. The non-residential wastewater
service rates are comprised of two components: 1) a fixed monthly charge for non-residential wastewater
monitoring and pretreatment program charges and 2) a volumetric monthly charge with four wastewater
strength categories.
The current and proposed wastewater rates charges for the next five years are presented in the Table 1
below:
Table 1 – Current and Proposed Wastewater Rates
Note: Revenue from rate increases assumes an implementation date of January 1, 2024 for new rates. For each fiscal year
thereafter, the assumption is that new rates will also be implemented on January 1st of each year.
Water Rates
Water revenues pay for the operations and maintenance of infrastructure required to deliver water to the
residential and non-residential customers of the City of Gilroy. A portion of these rates fund charges from
the Santa Clara Valley Water District (SCVWD), known as Valley Water, for ground water production and
management, as 100% of the City’s water is pumped from the ground.
The City currently charges residential and non‐residential customers a monthly fixed water charge, also
known as base charge, based on meter size. In addition to a fixed monthly charge, all customers pay a
variable charge, also known as volumetric rate, per 1,000 gallons consumed consisting of two rate tiers of
consumption (under and above 30,000 gallons) and three different pump pressure zones. The proposed
water rate design eliminates the two tiers and proposes a uniform tier for all customers.
The current and proposed water rate charges for the next five years are presented in detail on Table 2
below:
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Charge
Residential (100% Fixed)
Single-Family Residence $46.64 $51.07 $53.11 $55.24 $57.45 $59.74
Multi-Family Residence $33.13 $34.39 $35.77 $37.20 $38.69 $40.23
Non-Residential Volumetric Rates
Low Strength $7.41 $8.36 $8.69 $9.04 $9.40 $9.78
Domestic Strength $9.21 $9.51 $9.89 $10.29 $10.70 $11.12
Medium Strength $12.08 $13.15 $13.67 $14.22 $14.79 $15.38
High Strength $18.63 $21.56 $22.42 $23.32 $24.25 $25.22
Non-Residential - Monitoring & Pretreatment Program Base Rate Monthly Charges
Significant/Categorical $240.95 $287.19 $298.68 $310.63 $323.05 $335.98
Non-Significant/Categorical $95.22 $114.64 $119.22 $123.99 $128.95 $134.11
Other Non-Residential $11.47 $15.47 $16.09 $16.73 $17.40 $18.09
Sewer Rate Schedule Current
Rates
Proposed Sewer Rates
Resolution No. 2023-62
Adjust Water and Wastewater Rates with Proposition 218 Hearing and Notice Authorization
City Council Regular Meeting | October 16, 2023
Page 4 of 4
Table 2 – Current and Proposed Water Rates
Note: Revenue from rate increases assumes an implementation date of January 1, 2024 for new rates. For each fiscal year
thereafter, the assumption is that new rates will also be implemented on January 1st of each year.
Valley Water Passthrough Rate Increase for Groundwater
Valley Water charges the City a ground production charge for 100% of the City’s water that is pumped
from the ground. In the event that Valley Water imposes additional charges associated with the pumping
of groundwater, the City will implement a passthrough adjustment to customer’s bills no earlier than
thirty (30) days after the adjustment has been enacted by Valley Water and noticed to all City customers.
FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28
Monthly Fixed Service Charges
Meter Size
3/4 inch $11.53 $20.29 $21.50 $22.80 $24.16 $25.59
1 inch $19.24 $28.52 $30.23 $32.04 $33.96 $35.98
1 1/2 inch $38.47 $49.09 $52.04 $55.16 $58.47 $61.93
2 inch $61.55 $73.78 $78.20 $82.90 $87.87 $93.08
3 inch $115.39 $139.61 $147.99 $156.87 $166.28 $176.13
4 inch $192.30 $213.67 $226.49 $240.08 $254.49 $269.57
6 inch $384.62 $419.40 $444.57 $471.24 $499.52 $529.11
8 inch $615.37 $666.28 $706.26 $748.63 $793.55 $840.56
10 inch $884.50 $1,736.07 $1,840.24 $1,950.65 $2,067.69 $2,190.19
Residential Customers - Tiered Volumetric Rates
Tier 1 - Zone 1 $4.39 $3.93 $4.16 $4.41 $4.68 $4.96
Tier 1 - Zone 2 $4.93 $4.29 $4.55 $4.82 $5.11 $5.41
Tier 1 - Zone 3 $5.52 $4.65 $4.93 $5.23 $5.54 $5.85
Tier 2 ( more than 30 TG)
Tier 2 - Zone 1 $4.93 N.A.N.A.N.A.N.A.N.A.
Tier 2 - Zone 2 $5.47 N.A.N.A.N.A.N.A.N.A.
Tier 2 - Zone 3 $6.06 N.A.N.A.N.A.N.A.N.A.
Uniform Vol. Rates
Water Rate Schedule Current
Rates
Proposed Rates
Variable Charges for All Water Consumed ($/1,000 gallons (or TG))
CERTIFICATE OF THE CLERK
I, THAI NAM PHAM, City Clerk of the City of Gilroy, do hereby certify that the
attached Resolution No. 2023-62 is an original resolution, or true and correct copy of a
city Resolution, duly adopted by the Council of the City of Gilroy at a Regular Meeting of
said held on Council held Monday, October 16, 2023, with a quorum present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official
Seal of the City of Gilroy.
Dated:
____________________________________
Thai Nam Pham, MMC, CPMC
City Clerk of the City of Gilroy
(Seal)
Nov 6, 2023
Resolution No. 2023-62 Ready for Signature
Final Audit Report 2023-11-06
Created:2023-11-05
By:Thai Pham (Thai.Pham@ci.gilroy.ca.us)
Status:Signed
Transaction ID:CBJCHBCAABAAtfM4Ex9LUJDdQuI9ngn-quC-7Z_JvaX5
"Resolution No. 2023-62 Ready for Signature" History
Document created by Thai Pham (Thai.Pham@ci.gilroy.ca.us)
2023-11-05 - 4:29:27 AM GMT
Document emailed to marie.blankley@cityofgilroy.org for signature
2023-11-05 - 4:34:13 AM GMT
Email viewed by marie.blankley@cityofgilroy.org
2023-11-06 - 6:03:24 PM GMT
Signer marie.blankley@cityofgilroy.org entered name at signing as Marie Blankley
2023-11-06 - 6:19:55 PM GMT
Document e-signed by Marie Blankley (marie.blankley@cityofgilroy.org)
Signature Date: 2023-11-06 - 6:19:57 PM GMT - Time Source: server
Document emailed to Thai Pham (Thai.Pham@ci.gilroy.ca.us) for signature
2023-11-06 - 6:19:58 PM GMT
Email viewed by Thai Pham (Thai.Pham@ci.gilroy.ca.us)
2023-11-06 - 6:38:11 PM GMT
Document e-signed by Thai Pham (Thai.Pham@ci.gilroy.ca.us)
Signature Date: 2023-11-06 - 6:40:15 PM GMT - Time Source: server
Agreement completed.
2023-11-06 - 6:40:15 PM GMT