HomeMy WebLinkAboutItem I November 8, 1999
STAFF REPORT
To: Mayor and Members of the City Council
Attention: Keith R. Till, City Manager
From: Stephen G. Badum, Director of Public Works/City Engineer
Subject: STATUS REPORT— SEWER MASTER PLAN AND
RATE STUDY ANALYSIS
SUMMARY OF REQUEST:
The proposed action will approve in concept the City's financial plan to implement.the
first phase recommendations of the Sewer Master Plan.
DISCUSSION:
On February 9, 1997, City Council approved a professional services agreement with AKM
Consulting Engineers to prepare the City's Storm Drain and Sewer Master Plans. In
February 1999, the scope of this agreement was expanded to include an analysis of the
City's sewer rates.
In general, the Master Plan reveals the need to implement approximately $10 million in
capital improvements and replacements over the next 10 years. Discussions with the
Orange County Sanitation District indicate that matching funding up to $2 million may be
available which would leave a balance of approximately $8 million to be financed by the
City. The City's sewer rate structure is based upon usage only and there are no capital
charges for improvements and replacements. Sewer user fees are currently levied at 22%
of the users water bill. The current revenues cannot support the recommended capital
improvement plan. It is proposed that a capital charge of$8 per month be added to the
residential sewer bill to cover the first phase costs of the needed ten-year capital plan.
During the course of the Master Plan review, it was determined that the Seal Beach
Boulevard Force Main, which serves all of Old Town, Bridgeport, Coves, and Marina Hill
areas of Seal Beach, is inneed of immediate replacement and has been designated as the
first project of the ten year plan. The cost of the proposed project has been estimated at
$1.3 million. The City has recently received 50% matching Federal funds in the amount of
$650,000 to rehabilitate Seal Beach Boulevard from Adolfo Lopez Drive to the I-405. In
order to maximize the effectiveness of this paving project, it would be appropriate to
advance the sewer force main project and complete the needed work before or
1 AGENDA ITEMZf
Status Report—Sewer Master Plan
City Council Staff Report
November 8, 1999
concurrently with the paving rehabilitation project. However, the City's cash balance in
the Sewer Enterprise fund cannot cover the cost of this needed capital replacement.
Bonded indebtedness could be used to generate the needed funds immediately to advance
the force main replacement project and support the ten year capital program.
Upon conceptual approval, staff will finalize the Master Plan and Rate Study, submit it to
City Council for final approval, and initiate the rate revision process. Any future rate
changes would be subject to a balloting of residential, commercial, and industrial rate
payers.
FISCAL IMPACT:
There are no fiscal impacts at this time. Future decisions by City Council may result in a
rate increase for sewer utility users.
RECOMMENDATION:
It is recommended that City Council:
1. Conceptually approve the City's financial plan to implement a capital charge to fund
the recommendations of the Sewer Master Plan.
2. Conceptually approve the City's financial plan to obtain bond funding to advance the
Sewer Force Main Project and the ten-year capital improvement plan.
3. Direct staff to proceed with the finalization of the Sewer Master Plan and Rate Study
for Council approval.
4. Direct staff to initiate the sewer rate revision process.
NOTED AND APPROVED
.1-3
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4-I en . Badum, Director Keith R. Till
Public orks Department City Manager
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