Sanitary Sewer Fee Rate Study and Rate-Setting Process

April 16, 2019

To SMCSD Plant

Background - Sewers∗ 20 miles of sewer

pipes

∗ Most pipes over 80 years old

∗ 4 City pump stations

∗ Flows sent to SMCSD

∗ SMCSD provides treatment and discharge

SMCSD Sewage

∗ Working together, SMCSD and the City must address sewer infrastructure needs to protect the environment and the health and safety of residents.

∗ We need to be forward-thinking as climate and weather patterns continue to become more unpredictable.

∗ The City is responsible for properly collecting and containing raw sewage within Sausalito.

∗ SMCSD is responsible for safely and properly treating raw sewage.

∗ SMCSD performs both functions for other customers such as for Marin City and other unincorporated areas within the District’s boundaries.

Raw sewage spills present health risks to the community. Properly maintained pipes and infrastructure safely transport sewage -- essential to maintaining a healthy, safe community.

Sausalito’s 80-year-old sewer system is aging. Many of the 20 miles of sewer pipe were built in the 1930s and are made of clay, which if broken, could cause spills of raw sewage or allow infiltration into the Bay.

Through ongoing maintenance and improvement, the City and District remain in compliance with a 2008 Environmental Protection Agency (EPA) Order, reducing SSOs and potential penalties. Working together, the agencies have continued to improve compliance with Clean Water Act requirements.

Background - Rates∗ The City’s last rate study

was completed in 2014, and set rates through 2019

∗ Sewer rates are established for residential classes based on average use

∗ City rates are collected through the tax roll for sewage collection only

∗ SMCSD has its own rate

2019 Sewer Rate Study Involves 3 Steps

Operating Costs

•Admin•Engineering•Operations•Pumping

Debt Service

•2015 Sewer Revenue Bonds

Capital Needs

•Whiskey Springs PS

•Pipeline Replacement

•Annual Unplanned Repairs

Cost of Service Includes Three Components

Financial Plan Supports Cost Effective Long-Term Sewer Management

1900 1950 2000 2050

Mile

s of

Pip

e In

stal

led

Original Pipes

Financial Plan Supports Cost Effective Long-Term Sewer Management

1900 1950 2008 2050

Mile

s of

Pip

e In

stal

led

Original Pipes Replaced Pipes

“Nessie Curve”

Financial Plan Supports Cost Effective Long-Term Sewer Management

1900 1950 2008 2050

Mile

s of

Pip

e In

stal

led

Replaced PipesOriginal Pipes

Consistent Replacement Schedule For a Sustainable Funding Plan

Activity Proposed Timeline

Complete Financial Plan April 2019

Council Discussion and Action to Begin 45-Day Comment Period

April 30, 2019

Mail Notice of Public Hearing May 1, 2019

Public Comment Period May 1 through June 15, 2019

Public Hearing at Regularly Scheduled Council Meeting

June 18, 2019

If Approved, Take Action to Adopt New Rates

June 18, 2019

Rate-Setting Timeline Follows Proposition 218

∗ Public Discussion at Council Meeting on 4/30/19∗ Mail Notice of Public Hearing for Proposed Rates to all

Customers/Property Owners∗ Place Notice in Local Newspaper for Two Consecutive Weeks

Prior to Public Hearing∗ Post Resolution with Proposed Rates at City Hall

∗ A telephone hotline is available for ratepayers at (800) 676-7516.

SMCSD will conduct a similar process for thewastewater treatment rates

Public Noticing Process

Summary

• The City will continue to ensure equity for rate payers. Rebates are also available for low-income residents.

• Investment in sewer system infrastructure helps to reduce stormwater that enters into the sewer system. Current unpredictable weather patterns and microclimates – including excessive rain – make this need more urgent. Investment in infrastructure will help reduce future SSOs.

• Without continuing to update current rates, the City does not have the money needed to continue essential sewer upgrades. The funds would come at the expense of other essential City services.

Sanitary Sewer Fee Rate Study and Rate-Setting Process

Q&A