Utilities Rate Advisory Commission Meeting - May 22, 2024
STREAMING COPY IN PREPARATION — RECORDING AVAILABLE FROM THE ORIGINAL SOURCE
Utilities Rate Advisory Commission Meeting Summary
The Utilities Rate Advisory Commission (URAC) met on May 22, 2024, at 5:30 PM at City Hall Complex, 915 I Street, Sacramento, CA. The meeting was called to order by Chair Megan Fidell and adjourned at 6:11 PM. Commissioners present: Eberle, Johnson, Zito, and Chair Fidell. Commissioners absent: Ellis and Lee. The land acknowledgement was led by Chair Fidell, followed by the Pledge of Allegiance. New Commissioner Spencer Eberle was welcomed.
Consent Calendar
- Item 1: Passed a motion approving the Utilities Rate Advisory Commission Meeting Minutes of November 30, 2023. The motion was moved by Commissioner Zito, seconded by Commissioner Johnson, and passed unanimously (4-0-2) with Commissioners Ellis and Lee absent.
Discussion Items
- Item 2: Selection of Chair and Vice Chair for Calendar Year 2024 – After discussion, Commissioner Johnson moved to nominate Commissioner Zito for Chair. The motion was seconded and passed unanimously (4-0-2). Commissioner Zito then moved to nominate Commissioner Eberle for Vice Chair; the motion was seconded and passed unanimously (4-0-2). Both will start their terms at the next regular meeting. Outgoing Chair Fidell was not eligible to serve as Chair due to term limits (two calendar years served).
- Item 3: Department of Utilities FY23-25 Financial Updates – Presented by Penny Buchman, Supervising Financial Analyst. Key highlights:
- Water Fund: FY23 impact of $7.3 million (increased CIP costs); FY24 projected savings of $11.8 million ($1.3 million below budget); FY25 anticipates using $11.3 million of fund balance. Revenue includes $4.7 million from groundwater transfer, $4.8 million interest (up $2.4 million), and $1.2 million annual delinquency charges. A $1 million reduction in utility revenue due to metering and conservation. Partial bond refunding saved $4 million in debt service.
- Wastewater Fund: FY23 increase of $7.2 million; FY24 revenues tracking higher (utility revenue, new SAC Sewer agreement adding $300,000 annually, delinquency charges); FY25 positive impact of $300,000. Emergency CIP projects funded $4 million from fund balance.
- Storm Drain Fund: FY23 FEMA-eligible costs $3.3 million (seeking $2.4 million reimbursement); FY24 emergency CIP projects ($6 million added from fund balance, pending reimbursement from property-related fee fund). Interest revenue $902,000 (up $513,000).
- Storm Drain Property Related Fee Fund: In litigation; FY23 revenue $19.8 million on hold; FY24 estimated $20.4 million; $14.9 million budget moving forward.
- Reserves: New DOU reserve policy adopted. Operating reserves set at 120 days working capital. Available fund balance provides 189 days for water, 286 for wastewater, 325 for storm drain. Capital reserve for water: $31.6 million; wastewater: $3.3 million.
- Proposed FY25 Budget: Includes $488,000 savings from ending city-paid credit card merchant fees (effective Jan 1, 2025). Five new positions requested (supported by deleting others) – assistant director, administrative analyst, plant operator, two administrative technicians.
- SURA Program (Utility Rate Assistance): Currently supports 10,966 participants. FY25 budget increase of $100,000 to cover solid waste rate increases. Program may need a cap to stay within budget.
- PFAS Regulations: Commissioner Johnson asked about PFAS cost impacts. Staff noted significant future costs for monitoring and treatment; treatment not feasible on some well sites due to footprint. Costs will be factored into future rate adjustments (projected water/wastewater rate adjustments in FY28, storm drainage in FY29). A presentation on contaminants and PFAS is planned for a future meeting.
Commissioner Comments – Ideas and Questions
- Outgoing Chair Fidell (termed out, this being her last meeting) thanked staff and noted that days in reserve have decreased from nearly 300 days to under 200 days (fiscal year peak in FY21 due to pandemic). She emphasized that if days in reserve remain above the industry standard of 120 days when rate increases are considered in 2028, the commission should evaluate rate adjustments. She reviewed historical data showing the CIP has been too high for 12 years.
Public Comments – Matters Not on the Agenda
- None.
Key Outcomes
- Approved consent calendar (minutes).
- Elected Jill Zito as Chair and Spencer Eberle as Vice Chair for calendar year 2024.
- Received and filed the Department of Utilities FY23-25 Financial Updates.
- Commissioner Fidell’s final meeting; she highlighted the need to monitor reserve levels and spend down CIP.
- Next steps: DOU will present on emerging contaminants (PFAS) at a future meeting; FY25 budget to be adopted by City Council; rate adjustments anticipated in FY28 (water/wastewater) and FY29 (storm drainage).
Meeting Transcript
Chair staff is ready when you are please rate advisory commission meeting. The meeting is now called to order. Will the clerk please call the roll to establish a quorum? Thank you, Chair. Commissioners, if you can please unmute. Commissioner Zito present. Commissioner Eberlee. Present. Commissioner Ellis is currently absent. Commissioner Johnson. Present. Commissioner Lee is absent. And Chair Fidel. Present. Thank you. We have quorum. I would like to remind members of the public and chambers that if you would like to speak on an agenda item, please turn in a speaker slip when the term when the item begins. You'll have two minutes to speak once you are called on. After the first speaker, we will no longer accept a speaker slips. We will now proceed with today's agenda, starting with the land acknowledgement. Please rise for the opening and opening acknowledgments in order of Sacramento's indigenous people and tribal lands. To the original people of this land, the Nissanan people, the Southern Maidu, Valley and Plains Miwak, Patwin Wintun peoples, and the people of the Wilton Rancheria. Sacramento's only federally recognized tribe. May we may we acknowledge and honor the Native people who came before us and still walk beside us today on these ancestral lands by choosing to gather together today in the active practice of acknowledgement and appreciation for Sacramento's indigenous peoples history, contribution, and lives. Thank you. Please remain standing for the Pledge of Allegiance. One nation under God, indivisible, with liberty and justice for all. Thank you. Our first business today is approval of the consent calendar. Clerk, are there any members of the public who wish to speak on the consent calendar? Thank you, Chair. I have no speakers for this item. Thank you. Are there any commissioners who wish to speak on this item? Is there a motion and a second for the consent calendar? I think a motion that we approve the consent calendar. I'll second. I have a motion by Commissioner Zito and a second by Commissioner Johnson. Will the clerk please call the roll for the vote? Thank you, Chair. Members, if you can please unmute. Commissioner Zito. Aye. Commissioner Eberley. Aye. Commissioner Ellis is absent. Commissioner Johnson. Aye. Commissioner Lee is absent. And Chair Fidel.
openpublica.com