OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Yakima City Council Study Session on 2024-10-25: Water Rates, Traffic Safety, and 2025-2026 Budget Review

City Council — Friday, October 25, 2024
BodyYakima, Washington
SessionCity Council
DateFriday, October 25, 2024
StatusFILED
Video Record
0:00 / 4:45:07

Transcript — Verbatim
3:52

I call the regular meeting, excuse me, the study session of um October twenty second, twenty twenty four.

3:58

Yakim City Council back to order.

3:59

We'll start with roll call, please.

4:02

Here.

4:02

Brown.

4:03

Here.

4:04

Buyers.

4:05

DCO?

4:06

Here.

4:06

Glenn.

4:07

Here.

4:08

Herrera?

4:09

Here.

4:09

Roy.

4:10

Here.

4:11

Thank you.

4:12

Next on the agenda is public comment.

4:14

If anyone wishes to make public comment, we'll have 15 minutes tonight.

4:17

Each person will be allowed two and a half minutes.

4:19

If you want to make a public comment, please fill out a form in the lobby and bring it to the city clerk.

4:24

When to come to the podium, please identify yourself by your name and the city in which you live.

4:29

Do we have anything for public comments so far?

4:32

Mr.

4:32

Beeler, do we have any online public comment this evening?

4:35

No, Mayor Byrus, we do not.

5:05

Excuse me.

5:06

Um, in regard to uh the water division, the public's expectation is that no matter the time of day or night, when they go to turn on a faucet, they expect reliable, clean, and safe drinking water.

5:18

But at the same time, they also have the expectation that the city has sufficient fire suppression during an emergency.

5:25

So to support the fire department.

5:27

These expectations have costs associated with them.

5:31

Having implementing a rate study that accurately reflects the true cost of providing the essential service is crucial.

5:38

It should include the cost of such things as labor, fuel, material supplies, and even capital improvement projects to keep the infrastructure in good repair.

5:47

But it also should allow to meet those demands of the customers' increased demands over the years.

5:54

Rates should also be fair and equitable to the users.

5:58

Failure to support a proper rate structure begins to erode at the financial stability of the utility and its ability to provide the essential service that residents and community members depend upon.

6:10

As you'll see tonight, FCS group has put together proposed rates for the water division over the course of 2025 through 2029.

6:18

So with that, I'll turn it over to Mike Shane, our water irrigation manager.

6:22

So evening, Madam Mayor, Council members.

6:28

Dog 8, uh Aukar, and FCS group have performed a detailed review of our water utilities finances, including current assets, operational and capital expenditures, reserve balance, debt service, and the revenue requirements that support those expenditures in 2029.

6:47

He has also provided a review of our connection charges to support our capital investments, as well as our installation fees that recover the actual cost for new water service installations.

6:58

So I'll let Tog A take it from here.

7:01

All right, thank you.

7:03

So as Scott mentioned earlier, we were here a couple of months ago at that time, focused more on wastewater stormwater.

7:10

Today will be focused on the water utility.

7:13

And we've broken up the study into a couple of phases.

7:15

We'll be presenting on phase one tonight.

7:18

That's more of the overall revenue needs.

7:21

What's that impact on the bi-monthly rates that all customers pay?

7:25

But also looking at the connection charges, those are the one-time charges that growth and development pay as they build and connect to the water system.

7:37

So overall, you know, stripping it down to the basics.

7:41

We want to make sure that the water rates are covering the cost of providing service, and that can be operating costs, uh supplies and materials, the staff that you have on hand, vehicles and equipment, can be going towards paying for existing loans that you've already taken out, principal and interest, and then planning for the future.

8:03

How are you going to fund your capital program?

8:06

Is it with a mix of cash?

8:09

Will you borrow?

8:10

What can we expect from new development as they pay connection charges?

8:15

So all of that together is what we're trying to cover tonight in terms of how much revenue do you need to make sure that the water utility is continuing on in a healthy way over time.

8:26

And going into that, we look at some policy items.

8:29

Those are the blue boxes on the left.

8:32

As Mike mentioned, we look at reserve levels to make sure that you have enough cash on hand to cover day-to-day operations, uh, certain amounts of unplanned capital emergencies, and then in terms of how we want to fund the capital program, that all gets rolled into the overall revenue requirement.

8:53

Next phase would be those green boxes at the bottom.

Discussion Breakdown — Share of Meeting
Water And Wastewater Management██████████████████████22%
Public Works Administration████████████12%
Public Engagement██████████10%
Technology and Innovation█████████9%
Airport Development████████8%
Budget Equity Analysis███████7%
Fiscal Sustainability██████6%
Public Safety█████5%
Personnel Matters████4%
Summary of Proceedings

Yakima City Council Study Session on 2024-10-25: Water Rates, Traffic Safety, and 2025-2026 Budget Review

Note: The agenda, minutes, and transcript indicate the meeting occurred on October 22, 2024, but per instruction the date is given as October 25, 2024. This summary uses the provided date but notes the discrepancy.

The Yakima City Council held a study session on October 25, 2024, beginning with a 30-minute executive session on collective bargaining at 4:30 p.m., followed by the public study session at 5:00 p.m. The meeting covered a domestic water rate and fee study, a resolution authorizing an interlocal agreement with the Washington Traffic Safety Commission for traffic safety emphasis patrols, and a comprehensive review of the proposed 2025-2026 biennial priority-based budget across all city departments. No public comments were received. The meeting adjourned at 9:44 p.m. after the budget presentations.

Consent Calendar

  • None. The resolution on traffic safety patrols was adopted via roll call vote and is detailed under Key Outcomes.

Public Comments & Testimony

  • None. No members of the public provided comment in person or online.

Discussion Items

Domestic Water Rate and Fee Study

  • Presentation: Tage Aaker of FCS Group presented a five-year rate study (2025-2029) for the domestic water utility. The study recommended a 6.5% annual rate increase for 2025-2027 and a 4.5% increase for 2028-2029 to cover operating costs, debt service, and capital programs. A typical single-family customer’s monthly bill would increase from $28 to approximately $30 in 2025.
  • Connection Charges: The study proposed updating the domestic water connection charges, which had not changed since 2012. The maximum defensible charge for a three-quarter-inch meter was calculated at $2,891, with options to phase in over time. Installation fees for new services were also significantly under-recovering actual costs, with a proposed phase-in from $1,300 to $5,000 by 2029.
  • Council Discussion: Councilmembers questioned the fairness of rates compared to private utilities and the impact on ratepayers. Director Scott Schafer noted that the city’s utility pays an in-lieu-of tax similar to private utilities. No action was taken on the rate proposals; they are slated for future decision.

Resolution for Traffic Safety Emphasis Patrols

  • Presentation: Sergeant Scott Grant from the Yakima Police Department briefed the Council on Resolution R-2024-194, authorizing an interlocal agreement with the Washington Traffic Safety Commission for $113,000 in funding for overtime on high-visibility emphasis patrols (e.g., DUI, seatbelt enforcement). The funds cover regional patrols, not solely Yakima.
  • Council Position: Councilmember Glenn voted no, stating the amount was too small to justify administrative overhead. Other members supported the resolution to accept available funds.

2025-2026 Biennial Priority-Based Budget Review

The Council heard presentations from department heads outlining their 2025-2026 proposed budgets. Key points from each:

  • City Administration (City Manager Vicki Baker): Covered City Council stipends, travel, AWC membership ($14,000), economic development (including $50,000 for YCDA, fireworks at $15,000, federal lobbying at $60,000 annually), City Clerk’s office (public records, elections, LEOFF 1 pensions), and Information Technology (cybersecurity, GIS, application development). IT has not added staff in 19 years despite increased demands; a budget request for server warranties ($45,000) was noted as a cost-saving measure.
  • Human Resources (Connie Mendoza): The HR budget covers mandated programs: personnel administration, payroll ($7.6M monthly), civil service (funded by 0.5% of payroll), self-insured health plan ($15M program), workers’ compensation ($2.8M claims paid), and unemployment compensation. A request for a payroll analyst was made to create redundancy.
  • Community Relations (Randy Beehler): The office operates two TV channels and manages communications, primarily funded by cable franchise fees and PEG fees which are declining. No budget increase was requested; the office plans to seek grant funding for outreach and shift to short-form video and podcasts.
  • Airport (Rob Hodgman): The Yakima Air Terminal faces an $800,000 deficit in 2025 due to expiring grants and reduced revenues. Strategies include seeking a Las Vegas flight, increasing rental car and lease revenues, deferring PFAS foam replacement (unfunded mandate), and pursuing federal grants. Council discussed lease negotiations and the need to balance tenant relations with revenue needs.
  • Fleet and Facilities (Kerry Jones): Budget covers 660 equipment units (excluding police/fire), three fuel stations, and building maintenance (City Hall, Public Works, etc.). A request to convert a storekeeper position to an administrative assistant was noted. The new transit facility (former Subaru site) will undergo feasibility studies for alternative fuels.
  • Wastewater/Stormwater (Mike Price): Wastewater rates have not changed in several years; a 3% increase for residential (about $1/month) and 5.3% for commercial was recommended to keep pace with inflation and capital needs. Stormwater division proposes a 7% annual increase (approximately $6/year per residence). Capital projects include $20-25M for activated sludge improvements (potential bonding) and condition-based pipe rehabilitation.
  • Water/Irrigation (Mike Shane): Water operations budget is $14-14.5M annually. Capital projects focus on aging infrastructure replacement, joint water/sewer projects in unserved areas, and the Nelson diversion pipeline project (Phase 2 funded by $7.6M DOE grant and other sources). A budget request for a temporary water works specialist and a water treatment plant operator position were presented.
  • Finance (Viren Mayani and Kimberly Dominé): The Finance Division (11 FTEs) manages budget preparation, ACFR, accounts payable, grants ($19.5M federal, $6M state), debt ($48M), investments ($74M), and audits. Purchasing (now 4 FTEs including new manager) handles procurement, insurance compliance, P-card program (270+ cards), and surplus disposition. A budget request for an additional accountant to improve cross-training and redundancy was made. Utility Services (Anabel Chavez) oversees meter reading, billing, customer service, and the enterprise software (CAYENTA). Requests included three ruggedized laptops for field reps and a 10% increase in professional services funding.

Key Outcomes

  • Resolution R-2024-194 (Traffic Safety Patrols): Adopted by a 6-1 roll call vote (Councilmember Glenn voting no). The resolution authorizes the City Manager to execute the interlocal agreement with the Washington Traffic Safety Commission for $113,000 in overtime reimbursement.
  • Executive Session: The Council held a 30-minute executive session on collective bargaining (RCW 42.30.140(4)(a)), entering at 4:32 p.m. and concluding at 5:00 p.m.
  • Budget Review: No formal votes were taken on budget items. The presentations were informational to guide future decisions. The next study session is scheduled for October 29, 2024, at 5:00 p.m. to continue budget discussions.
  • Referrals: Councilmember Brown suggested exploring alternative lobbyists in Olympia. The City Manager will research options. The water and sewer rate proposals, along with connection fees, will be considered as part of the 2025-2026 budget adoption.

Meeting Transcript

I call the regular meeting, excuse me, the study session of um October twenty second, twenty twenty four. Yakim City Council back to order. We'll start with roll call, please. Here. Brown. Here. Buyers. DCO? Here. Glenn. Here. Herrera? Here. Roy. Here. Thank you. Next on the agenda is public comment. If anyone wishes to make public comment, we'll have 15 minutes tonight. Each person will be allowed two and a half minutes. If you want to make a public comment, please fill out a form in the lobby and bring it to the city clerk. When to come to the podium, please identify yourself by your name and the city in which you live. Do we have anything for public comments so far? Mr. Beeler, do we have any online public comment this evening? No, Mayor Byrus, we do not. Excuse me. Um, in regard to uh the water division, the public's expectation is that no matter the time of day or night, when they go to turn on a faucet, they expect reliable, clean, and safe drinking water. But at the same time, they also have the expectation that the city has sufficient fire suppression during an emergency. So to support the fire department. These expectations have costs associated with them. Having implementing a rate study that accurately reflects the true cost of providing the essential service is crucial. It should include the cost of such things as labor, fuel, material supplies, and even capital improvement projects to keep the infrastructure in good repair. But it also should allow to meet those demands of the customers' increased demands over the years. Rates should also be fair and equitable to the users. Failure to support a proper rate structure begins to erode at the financial stability of the utility and its ability to provide the essential service that residents and community members depend upon. As you'll see tonight, FCS group has put together proposed rates for the water division over the course of 2025 through 2029. So with that, I'll turn it over to Mike Shane, our water irrigation manager. So evening, Madam Mayor, Council members. Dog 8, uh Aukar, and FCS group have performed a detailed review of our water utilities finances, including current assets, operational and capital expenditures, reserve balance, debt service, and the revenue requirements that support those expenditures in 2029. He has also provided a review of our connection charges to support our capital investments, as well as our installation fees that recover the actual cost for new water service installations. So I'll let Tog A take it from here. All right, thank you. So as Scott mentioned earlier, we were here a couple of months ago at that time, focused more on wastewater stormwater. Today will be focused on the water utility. And we've broken up the study into a couple of phases. We'll be presenting on phase one tonight. That's more of the overall revenue needs. What's that impact on the bi-monthly rates that all customers pay? But also looking at the connection charges, those are the one-time charges that growth and development pay as they build and connect to the water system. So overall, you know, stripping it down to the basics.

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