Utilities Rate Advisory Commission Meeting Summary - May 23, 2012

The Utilities Rate Advisory Commission met on May 23, 2012, at 5:30 p.m. in the Council Chambers of New City Hall, 915 I Street, Sacramento. The meeting was called to order at 5:32 p.m. and adjourned at 7:30 p.m. Six commissioners were present (Jeff Donlevy, Kevin Schubert, Douglas Brown, Steven Archibald, Scott Brown, Carolyn Veal-Hunter); Karen McBride was absent. The commission approved minutes, elected a new chair and vice chair, received an ordinance update, and heard a detailed presentation on the Solid Waste Division's 2012 Business Plan, followed by discussion of the recently approved Utility Rate Assistance Program.

Consent Calendar

• Approval of Minutes for February 2, 2012: Motion by Douglas Brown, second by Carolyn Veal-Hunter, passed unanimously. The minutes were approved.

Public Comments & Testimony

• No public comments were made.

Discussion Items

• Nomination/Selection of New Chair and Vice Chair: After nominations, a roll call vote resulted in Douglas Brown being elected Chair (all commissioners present voted for Brown). He then presided over the election of Vice Chair; Karen McBride was nominated and elected by voice vote, all in favor.
• Utilities Rate Advisory Commission Ordinance Update: Staff (Jessica Hess) reported that an amendment to the commission's ordinance will be presented to the Law and Legislation Committee on June 7, 2012, and to the full City Council in late July. The amendment changes the definition of "department" from the Department of Utilities to whichever department provides water, sewer, drainage, or solid waste services. The commission received and filed the update.
• Report on 2012 Business Plan for the Solid Waste and Recycling Division: Steve Harriman, Integrated Waste General Manager, presented the plan to the commission for comment. The plan includes:
  • Discontinuing commercial waste collection (approved by council on March 20, 2012) to focus on residential services.
  • Changing residential recycling from weekly to bi-weekly collection, saving over $1 million annually, 83,000 gallons of fuel, and 186 tons of greenhouse gas emissions (equivalent to about 750 cars, though calculation was debated).
  • Implementing a uniform yard waste program: all residential customers receive a weekly container for green waste, and loose-in-the-street collection will be offered citywide only in November, December, and January. The program is contingent on repealing Measure A (a 1977 initiative prohibiting mandatory containerized yard waste), which requires a simple majority vote in the November 2012 election. If repealed, the plan would bring back an appointment-based neighborhood cleanup program (February–October).
  • No net rate increase for single-family homes through June 30, 2015, due to operational savings, though rates by line of service (garbage, recycling, green waste) would be true-upped.
  • Commissioners raised questions and concerns about: the impact of service-level changes on rates (Commissioner Archibald argued that reduced service frequency effectively doubles the cost); the legality of cross-subsidies under Proposition 218 (Commissioner Archibald noted the current loose-in-the-street program is underfunded and subsidized); the potential for backlogs in the appointment-based cleanup program; the funding for a Measure A advocacy campaign (city staff can only educate, not advocate); and the lack of rate regulation for commercial haulers (Commissioner Veal-Hunter complained about unsightly alleys). Staff provided detailed responses, noting that if Measure A is not repealed, the loose-in-the-street rate would need to at least double (from $13.71 to $26–$30 per month), and the commission would be asked to consider rate adjustments accordingly.
• Commission Ideas, Questions, and Announcements: Commissioner Steven Archibald reported on the City Council's action from May 22, 2012, regarding the Utility Rate Assistance Program. The council unanimously approved a program to provide financial assistance to low-income households for water and sewer rate increases. The program is funded by approximately $1.1 million from utility tax revenues. Initial estimates suggest about 25,000 households could be served (68% of those identified as eligible), with assistance of about $60 per household in the first year, increasing over time. The program's details are still being developed, and it will be part of the city budget. Commissioners thanked Commissioner Veal-Hunter for keeping the issue on the commission's agenda and acknowledged the achievement.

Key Outcomes

• Minutes approved (Consent Calendar).
• Douglas Brown elected Chair and Karen McBride elected Vice Chair of the commission for the upcoming term.
• Ordinance update received and filed; the amendment will proceed to the Law and Legislation Committee and City Council.
• Solid Waste Business Plan presentation received and filed; no formal action was taken by the commission. The plan will be discussed further at the City Council on June 26, 2012, where council will consider placing Measure A repeal on the November ballot. The commission will be involved in rate true-ups after the election.
• Utility Rate Assistance Program: The council's unanimous approval was noted; the commission will monitor the program's implementation and inclusion in the city budget. Next steps include finalizing the program details and ensuring continued funding.