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									     City of Stockton
Municipal Utilities Department

     Delta Water Supply Project
     Information Meeting
     Large Water Users
     April 20, 2009


                                  1
     Welcome and Introductions

   City Staff
    – Mark Madison, Director of Municipal Utilities
    – Bob Granberg, Deputy Director – Water Resources
    – Melissa Price, Program Manager – Water Resources
   Consultants
    – Tom Gould (HDR Engineering)
    – Shawn Koorn (HDR Engineering)




                                                         2
            Meeting Objectives
 Brief Overview of Stockton’s Water Picture
 Overview of Delta Water Supply Project
  (DWSP)
    – History
    – Project Status
    – Project Challenges
   Overview of the DWSP Rate and Fee Study
    – Preliminary Results
    – Impact to Large Water Users



                                               3
               Stockton’s Water
   Stockton served by:
    – City
    – Cal Water
    – County
   60 million gallon per
    day surface water
    treatment plant
    (Stockton East)
   Approximately 60
    groundwater wells

                                  4
Stockton Metropolitan Area Water
               Demand – 4/08 to 4/09


    Total Demand = 70,540 acre-feet

        GROUND WATER
         21,838 AF – 31%




                            SURFACE WATER
                             48,702 AF- 69%




                                              5
Current Surface Water Sources

                                                                                                        Pardee Reservoir
                                                                   e


                                                                           Comanche Reservoir



                                               SJW                                                                               Calaveras County Water Transfer
                                      NSJWCD Pipeline
                                                                                                                   New Hogan Lake
                                                                                                                                 Appropriative Water Rights
                                                        NSJWCD A
                                                                                                                               USBR New Hogan Water Contract
    o



                                                                       r

                                                                                                                     Salt Spring Valley Reservoir




        m r                                                                                                                                                              New Melones Lake

                                                                                  gt                                              SSJID/OID Transfer
                                                                                                                                    USBR New Melones Interim Water Contract
                                                                                  Farmington Flood Control Basin                                                 Tulloch Reservoir



                                                                                                 Woodward Reservoir




                                                                              oaqui    n Canal
City of Stockton Delta Water Supply Project
            SEWD Water Supplies
                                                                                                                                                                                              Don Pedro Reservoir

3
Q       SEWD Water Treatment Plant
        Place of Use /                 Existing Water Supplies
        City General Plan Boundary
        Urban Service Area Boundary     Canals
                                                                                                                                             Modesto Reservoir




                             ¯
                                                                                                                      u
              State Plan 3 NAD83                                                                                                                                     Turlock Lake
              Sep. 2002
              Sacramento, CA
                                                                                                                                                                                                                          6
                                                                                                                                         G:\City_of_Stockton\Delta Water Project\GIS\ArcMap\Phasing\SEWDwaterSupply.mdx
     Stockton Water Supplies
 Surface   Water:
  – Stanislaus River (New Melones)
     Snowpack   fed
     Limited supply in dry years
     Subject to purchase contracts (currently under
      negotiation)
  – Calaveras River (New Hogan)
     Rainfallfed
     Limited supply in dry years
     Using unappropriated Calaveras County supply

  – Groundwater
     Salinity   intrusion                             7
Water Supply Challenges
        Need for reliability in times of
         drought
         – Currently have declining, less
           reliable surface water supplies
         – Water transfers subject to
           market conditions and
           environmental restrictions
      Need to protect groundwater
       supplies
      Need to provide for future
       planned water needs
                                             8
      Water Supply Challenges
                   (continued)


 Current   water supplies not guaranteed
  – Contract surface water supplies
  – Groundwater basin not sustainable without
    proper planning
 Watersupply challenges evident
 10 years ago
  – Interim transfer agreement
  – Initiation of DWSP planning

                                                9
                       The Solution:
                Delta Water Supply Project

   Delta Water Rights
    Application
    – Water Code Section
      1485 Rights
        Entitlement   to Delta water
    – Area of Origin Water
      Doctrine                          Stockton’s First Water Right
        Area of Origin Statutes
        Delta Protection Act
                                           Based on Section 1485
         Statutes
                                           Issued March 8, 2006
                                           33,600 acre-feet/year
                                           Up to 125,900 acre-feet/year
                                            by 2050
                                                                       10
                  DWSP History
   1970’s
    – City studied a Delta water project
    – Abandoned in favor of a contract with the Stockton East
      Water District
    – Water Rights application expired
   1980’s
    – Stockton East’s 1983 Contract with the US Bureau of
      Reclamation never materialized
   1990’s
    – City again applied for a water right in 1995
   2000’s
    – Council approved a feasibility report in 2003
    – Council approved current project in 2005
    – Water right granted by State in 2006                      11
              Recent Milestones
   November 8, 2005
    – Certification of EIR
    – Project Approval
    – Council Project Committee Established
        Review  financial decisions
        Review procurement decisions and assist with consultant
         and contractor selections
        Provide input to staff on key decisions

 Water Right Permit issued March 8, 2006
 Public Meeting (Project Design) – January 2008


                                                                   12
          DWSP Organization

   Council Water        Engineering & Construction
    Committee            Environmental Documentation
   Executive Team       Real Estate & Right of Way
   Program              Finance & Accounting
    Management Team      Public Information and
                          Outreach
                         Water Rights
                         Operations Planning
                         State & Federal Permitting


                                                   13
       Project Components

 Intake and Pump Station
 Water Treatment Plant and Pipelines




                                        14
Project Location




                   15
      Intake and Pump Station
   HDR Engineering
    – Design and Permitting Services
   Carollo Engineering
    – Construction Management
 Design is complete
 Prequalification process
  underway
 Outstanding issues
    – Acquisition and Right of Way
    – Permitting
                                       16
       Intake and Pump Station
                          Site Plan



                                 Screening/Sediment
                                 Management
                                                  Vertical Turbine
                                                  Pumps

                      Future
                      Pipeline
                                                          Security
                                                          Fence

Raise Levee at Site
                       Fish Screen and
                       Cleaning System
                                                                     17
Water Treatment Plant & Pipelines

 Request for Qualifications in 2006
 Request for Proposals in 2007
  – Stage 1 Services
              design to 65 percent
      Facility

      Stage 2 lump sum construction cost
        – Cost control and cost certainty
  – Stage 2 Services
      Projectconstruction
      Negotiations currently underway with CDM


                                                  18
         Water Treatment Plant
                       Site Plan

 60   acre site
  – North and South entrance roads
  – Main Buildings:
        Administration/Operations

        Maintenance Shop
        Chemical, Membrane, Ozone Buildings

  – Other: Flocculation Basin, Solids Drying
    Beds, Treated Water Storage Tank
  – Staff and public parking
                                               19
Treatment Plant Site Plan
    Full Build-Out (2050)




                            20
Treatment Plant Site Plan
         Phase I




                            21
    Project Construction Schedule

   Intake and Pump Station
    –   Design                                Feb 2009
    –   Permitting                             Ongoing
    –   Bidder Prequalification           Apr – May 09
    –   Bid & Negotiation                 May – Jun 09
    –   Contract Approval                       Aug 09
    –   Construction                Sept 09 – Aug 2011
   Plant and Pipelines
    –   Stage 1 Design                        Feb 2009
    –   Bid & Negotiation                 Mar – Jun 09
    –   Contract Approval                       Aug 09
    –   Construction              Sept 2009 – Dec 2011
    –   Commissioning              Jan 2012 – Jan 2013
    –   Final Completion                      Feb 2013
                                                    22
              Project Challenges
   Permitting
    – State Endangered fish species
      (Delta smelt)
        Seasonal   pumping curtailment accepted by federal
         government
        State wants “zero” net take through a 7 month pumping
         curtailment
        Mitigation plan under review by State
           – Purchase of habitat lands
           – Buy into habitat bank
    – Reclamation Board
        Levee   construction
                                                                 23
              Project Challenges
                           (continued)

   Acquisition and Right of Way
    – Siegfried Engineering in 2006
        Review Title Reports and Record Maps
        Determine Property Lines

    – 100% of plat maps completed for 30 properties
      requiring easements
        Farmers

        Developers

        Reclamation   Districts
        Residents

    – 90% of easements belonging to 13 owners
                                                      24
   Financial Activities Overview

 Cal Water Participation
 Cost Study

 Surface Water Split Analysis

 Grants and Loans

 Financing Plan

 Rate and Fee Study



                                   25
       Cal Water Participation

 Memorandum     of Understanding executed
  in 2005
  – Cooperative agreement to move project
    forward
 In2008, Cal Water determined it would not
  participate in project
  – Would pursue other water supply options



                                              26
                Cost Study

 HDR    selected in 2006
  – Cost Study (Capital and O&M Costs)
  – Draw Down Schedule
  – Cost Review (25%, 50%, Stage 2)
 CostStudy accepted by City Council
  September 2007
 $202 million most recent public estimate



                                             27
     Surface Water Split Analysis

   Contract with Montgomery Watson Harza in
    2006
    – Determine cost split between existing rate payers
      (replacement) and new development
   Water produced from the DWSP will not be used
    solely for new planned growth
    – DWSP benefits new and existing customers
    – Portion of DWSP capacity is attributed to replacing
      surface water supplies and improving groundwater
      conditions
    – Remaining portion is to meet new growth consistent
      with City of Stockton General Plan

                                                            28
         Grants and Loans

 Proposition 50 (2002)
 Proposition 84 (2006)

 Water Resources Development Act 2007
  (WRDA)
 State Drinking Water Revolving Loan




                                     29
      General Plan of Finance

 30-Year   Fixed Rate Revenue Bonds
  – 2 Series (2009 and 2010)
  – Standard 10 year call
  – Current rate approximately 5.8%
 Water  utility recently upgraded from A- to
  A rating
 Will consider insured deal if necessary



                                                30
        Rate and Fee Study

 HDR   Engineering
 – DWSP Rate and Fee
   Study
    Methodology

    PreliminaryResults
    Proposed Impacts




                             31
Overview of Rate and Fee Study
DWSP Capital Costs
 Total DWSP Project
 Costs and Funding
       Sources



Surface Water Supply
    Fee Analysis          DWSP Revenue Requirement             Stockton Retail
                         + DWSP O&M                         Revenue Requirement
Growth-related portion
 of DWSP to establish    + DWSP Debt Service             + Stockton O&M
    cost-based fee       - Surf. Water Supply Fee Rev.   + Stockton Taxes
                                                         + Stockton Debt (non DWSP)
                         = Total DWSP Rev. Requirement
                                                         + Stockton CIP from Rates
Projection of Surface                                    = Stockton Total Rev. Req.
    Water Supply                                            Before DWSP             .
   Fee Revenues                                          + Total DWSP Rev. Requir.
 Fee x connections =                                     = Total Revenue Requirement

SWS Fee Revenue ($)

                                                                               32
                Water Utility Funding

                                      Capital Improvement Program


   Maintenance and           Replacement Water      New Development Water
   Operations Costs            Facility Costs           Facility Costs

                                                     New Surface       Water
Fixed Service   Quantity          Water Supply
                                                     Water Supply    Connection
 Charge Rate     Rate           Replacement Rate
                                                         Fee            Fee

                                                     New Melones
                                                     Surface Water
                                                      Supply Fee

                       User Rates                      Connection Fees


                                                                            33
  Development of the
Draft Water Rate Study




                         34
        Key Objectives of the
      Comprehensive Rate Study
   Key Objectives
    – Meet the overall funding/financing requirements of
      the DWSP through a combination of funding resources,
      which includes water rates.
    – Maximize the funds available for the DWSP, while
      minimizing the impacts to rates and customers.
    – Develop a water rate study which would support the
      necessary long-term borrowing associated with the
      DWSP and the associated rate covenants.
    – To the maximum extent possible, attempt to achieve
      an equitable balance of the financial and rate impacts
      of the DWSP between existing and future customers.
                                                           35
             Overview of the
         Key Analytical Elements
   Revenue Requirement Analysis
    – Developed analysis “before” and “after” the DWSP
    – Reviewed FY 2009 – FY 2018
    – Key input – DWSP Financing Plan
    – Key issue – Meeting minimum debt service coverage (covenants)
      – i.e. legal requirement to assure repayment of the debt
    – Developed a 4-year rate transition plan to phase-in needed
      adjustments
   Rate Design Analysis (Proposed Rates)
    – Considered contemporary rate designs and California Urban Water
      Conservation Council Best Management Practices (BMPs)
    – Attempted to balance impacts from revenue requirement against
      changes in rate structure
                                                                 36
                Summary of the Draft Revenue
                 Requirement Before DWSP
                                                    ($ Millions)

                                  FY       FY        FY        FY        FY       FY       FY       FY       FY       FY
                                 2009     2010      2011      2012      2013     2014     2015     2016     2017     2018
Sources of Funds -
  Retail Revenue                 $23.92   $24.40    $24.89    $25.39    $25.89   $26.41   $26.94   $27.48   $28.03   $28.59
  Misc. Revenue                    1.75     1.96      2.30      2.52      2.81     3.07     3.11     3.23     3.27     3.37
   Total Sources of Funds        $25.67   $26.36    $27.19    $27.90    $28.71   $29.48   $30.05   $30.71   $31.30   $31.96

Application of Funds -
 O&M Expenses                    $20.86   $23.65    $26.24    $27.17    $18.17   $18.99   $19.84   $20.71   $21.62   $22.56
 Net CIP from Rates                0.39     1.60      1.65      1.70      1.75     1.80     1.85     1.90     1.95     2.00
 Net Debt Service Payments         1.18     1.18      1.19      1.18      1.19     1.19     1.19     1.19     1.19     1.11
 Change in Working Capital         2.11     0.90      0.85      0.80      0.75     0.70     0.65     0.60     0.55     0.50
   Total Application of funds    $24.54   $27.33    $29.93    $30.86    $21.85   $22.67   $23.53   $24.40   $25.31   $26.17

Bal./(Deficiency) of Funds        $1.13   ($0.97)   ($2.74)   ($2.95)    $6.85    $6.80    $6.52    $6.30    $5.99    $5.79
Rate Adjust. Needed to Bal. to
 Revenue Requirements             -4.7%     4.0%     11.0%     11.6%    -26.5%   -25.8%   -24.2%   -22.9%   -21.4%   -20.3%




                                                                                                                      37
          Summary Conclusions
            Before the DWSP
   Rates would appear to be generally sufficient
    over this time horizon, however:
    – FY 2013 includes a $9.4 million reduction in
      purchased water costs (DWSP assumed to come
      on line)
    – If the DWSP is not constructed, there will be a
      projected deficiency of funds (approximately 20%)
      primarily for water purchase costs
   No significant rate adjustments since 1996
    – Rate adjustments since 2003 have been to
      address cost of living only
                                                      38
             Analysis of the
          Impacts of the DWSP
   Key O&M Assumptions
    – Begin to incur startup O&M expenses in FY 2012
      ($2.8 million) and full O&M expenses in FY 2013 ($5.0
      million)
   Key Debt Assumptions
    – Assumed capital investment of approximately:
        $200   million to $240 million
    – Related debt service for the DWSP before netting out
      DWSP fee is approximately $17 to $21 million
        NetDebt Service of approximately $14 to $18 million
        per year (annual debt less DWSP fees)
                                                               39
          DWSP Financing Plan

   Traditional revenue bonds
    – Includes capitalized interest to reduce rate impacts
      and increase debt service coverage
   1.0x debt coverage from rates needed for financing
    – Dedicating two years of minimum DWSP fee revenue to
      rate stabilization fund
        Provides   debt service coverage of 1.30x
   Balance of DWSP fee revenues will be used to buy
    down debt in future years and repay operating fund
   Minimizes rate adjustments due to coverage issues


                                                             40
       Summary of the Revenue
   Requirement With DWSP - $200M
                                                ($ Millions)


                                 FY       FY        FY        FY        FY         FY         FY         FY         FY         FY
                                2009     2010      2011      2012      2013       2014       2015       2016       2017       2018
Bal./Deficiency) of Funds
 Before the DWSP                 $1.13   ($0.97)   ($2.74)   ($2.95)    $6.85      $6.80      $6.52      $6.30      $5.99      $5.79

DWSP-Related Costs
 DWSP O&M Expenses               $0.00    $0.00     $0.00     $2.89     $4.99      $5.16      $5.34      $5.53      $5.72      $5.92
 Net Debt Service (P+I)           0.00     0.00      2.03      3.02     12.42      14.45      14.44      14.45      14.44      14.40
Total DWSP-Related Costs         $0.00    $0.00     $2.03     $5.91    $17.41     $19.61     $19.79     $19.98     $20.17     $20.32

Total Rev. Req. w/ DWSP         $24.54   $27.33    $31.96    $36.77    $39.26     $42.29     $43.31     $44.38     $45.47     $46.49

Total Bal./(Deficiency) of
 Funds w/DWSP                    $1.13   ($0.97)   ($4.77)   ($8.87)   ($10.56)   ($12.81)   ($13.27)   ($13.67)   ($14.18)   ($14.53)

Rate Adjust. Needed to Bal to
 Total Rev. Requirements         -4.7%    4.0%      19.2%     34.9%     40.8%      48.5%      49.2%      49.8%      50.6%      50.8%




                                                                                                                              41
          Summary of the Revenue
      Requirement With DWSP - $220M
                                                   ($ Millions)


                                 FY       FY        FY        FY        FY         FY         FY         FY         FY          FY
                                2009     2010      2011      2012      2013       2014       2015       2016       2017        2018
Bal./Deficiency) of Funds
 Before the DWSP                 $1.13   ($0.97)   ($2.74)   ($2.95)    $6.85      $6.80      $6.52      $6.30      $5.99          $5.79

DWSP-Related Costs
 DWSP O&M Expenses               $0.00    $0.00     $0.00     $2.89     $4.99      $5.16      $5.34      $5.53      $5.72       $5.92
 Net Debt Service (P+I)           0.00     0.00      2.43      3.55     13.95      16.20      16.19      16.19      16.19       16.15
Total DWSP-Related Costs         $0.00    $0.00     $2.43     $6.44    $18.94     $21.36     $21.53     $21.72     $21.92      $22.07

Total Rev. Req. w/ DWSP         $24.54   $27.33    $32.36    $37.30    $40.79     $44.03     $45.06     $46.13     $47.23      $48.24

Total Bal./(Deficiency) of
 Funds w/DWSP                    $1.13   ($0.97)   ($5.17)   ($9.40)   ($12.09)   ($14.56)   ($15.01)   ($15.42)   ($15.93)    ($16.28)

Rate Adjust. Needed to Bal to
 Total Rev. Requirements         -4.7%     4.0%     20.8%     37.0%     46.7%      55.1%      55.7%      56.1%      56.8%          56.9%




                                                                                                                              42
          Summary of the Revenue
      Requirement With DWSP - $240M
                                                   ($ Millions)

                                 FY       FY        FY        FY        FY         FY         FY         FY         FY         FY
                                2009     2010      2011      2012      2013       2014       2015       2016       2017       2018
Bal./Deficiency) of Funds
 Before the DWSP                 $1.13   ($0.97)   ($2.74)   ($2.95)    $6.85      $6.80      $6.52      $6.30      $5.99      $5.79

DWSP-Related Costs
 DWSP O&M Expenses               $0.00    $0.00     $0.00     $2.89     $4.99      $5.16      $5.34      $5.53      $5.72      $5.92
 Net Debt Service (P+I)           0.00     0.00      2.83      4.08     15.48      17.94      17.93      17.94      17.93      17.89
Total DWSP-Related Costs         $0.00    $0.00     $2.83     $6.97    $20.47     $23.10     $23.28     $23.47     $23.66     $23.81

Total Rev. Req. w/ DWSP         $24.54   $27.33    $32.76    $37.83    $42.32     $45.77     $46.80     $47.87     $48.97     $49.98

Total Bal./(Deficiency) of
 Funds w/DWSP                    $1.13   ($0.97)   ($5.56)   ($9.92)   ($13.61)   ($16.30)   ($16.76)   ($17.16)   ($17.67)   ($18.02)

Rate Adjust. Needed to Bal to
 Total Rev. Requirements         -4.7%     4.0%     22.4%     39.1%     52.6%      61.7%      62.2%      62.5%      63.0%      63.0%




                                                                                                                               43
             Summary Conclusions
               After the DWSP
   Rates are projected to be deficient by approximately
    51% to 63% before debt service coverage
    requirements
   Need for a rate transition plan to meet coverage
    requirements
                             FY      FY      FY      FY
                            2010    2011    2012    2013
$200 Million
Proposed Rate Adjustments   15.0%   12.0%   10.0%   10.0%
Cumulative % Change         15.0%   28.8%   41.7%   55.8%
$220 Million
Proposed Rate Adjustments   15.0%   15.0%   12.0%   10.0%
Cumulative % Change         15.0%   32.3%   48.1%   62.9%
$240 Million
Proposed Rate Adjustments   15.0%   15.0%   15.0%   12.0%
Cumulative % Change         15.0%   32.3%   52.1%   70.3%
                                                            44
 Development of the
Draft Proposed Rates




                       45
           Overview of Water
            Rate Structures
      rate structures are generally
 Water
 composed of:
  – Fixed Meter Charge – The charge varies
    based upon the capacity of the meter
  – Quantity or Consumption Charge – Based
    upon the metered volume of use
              structures and philosophies regarding the
     Different
      consumption portion of the rate structure
     Conservation and efficient use


                                                      46
 Types of Consumption-Based
       Rate Structures
$/CCF                                       $/CCF
        Declining Block Rate Structure                     Uniform Rate Structure




                                   Usage                                        Usage


$/CCF                                       $/CCF
        Inverted or Tiered Rate Structure                  Seasonal Rate Structure




                                   Usage            Jan.            Time             Dec.
                                                                                            47
 Requirement for a Conservation
     Based Rate Structure
 City Water Conservation Plan (February 2008)
 California Urban Water Conservation Council
  (2006)
    – Best Management Practice (BMP) No. 11
    – A conservation-based rate may be a uniform,
      inverted block, seasonal or water budget rate
      structure; Assumes 70% of revenue derived is
      from the consumption charge
    – Declining block structure is not a conservation-
      based rate design
   Careful consideration was given to the impacts
    from a change in structure
                                                         48
   Overview of the City’s
Present Water Rate Structure
               PRESENT RATES

     Base Charge
        5/8"          $14.25   /Month
        3/4"          $16.75   /Month
         1"           $22.00   /Month
       1 1/2"         $31.75   /Month
         2"           $41.00   /Month
         3"           $72.50   /Month
         4"          $104.25   /Month
         6"          $171.75   /Month
         8"          $249.00   /Month
        10"          $310.75   /Month
        12"          $437.50   /Month

     Commodity Charge

     Use < 300 ccf    $0.82    /CCF
     Use > 300 ccf    $0.69    /CCF
                                        49
         Proposed Rate Structure

 Uniform rate structure for all classes of service
 Same rate for all customers

 Set up specific classes of service

 Advantage of rates by classes of service
    – Potential for different rate structures for different
      classes of service (e.g., irrigation vs. commercial)
    – Tailor future rate adjustments by class of service



                                                              50
              Overview of Proposed
              Rates - $200M DWSP
                           Present            Proposed Water Rates
                           Water      FY       FY              FY      FY
   Rate Components         Rates     2010     2011            2012    2013

Monthly Service Charge -
      5/8" Meter            $14.25   $15.00   $15.75         $16.25   $17.00
          3/4"               16.75    17.65    18.50          19.10    20.00
           1"                22.00    23.15    24.30          25.10    26.25
         1-1/2"              31.75    33.40    35.10          36.20    37.90
           2"                41.00    43.15    45.30          46.75    48.90
           3"                72.50    76.30    80.15          82.70    86.50
           4"               104.25   109.75   115.20         118.90   124.35
           6"               171.75   180.80   189.85         195.85   204.90
           8"               249.00   262.10   275.20         283.95   297.05
          10"               310.75   327.10   343.45         354.35   370.70
          12"               437.50   460.55   483.55         498.90   521.95

Quantity Charge $/CCF
      0-300 CCF              $0.82
    Over 300 CCF             $0.69
   All Consumption                    $1.02    $1.17          $1.34    $1.52


                                                                               51
               Overview of Proposed
               Rate - $220M DWSP
                           Present             Proposed Water Rates
                           Water      FY       FY               FY      FY
   Rate Components         Rates     2010     2011             2012    2013

Monthly Service Charge -
      5/8" Meter            $14.25   $15.00   $16.00          $17.00   $18.00
          3/4"               16.75    17.65    18.80           20.00    21.15
           1"                22.00    23.15    24.70           26.25    27.80
         1-1/2"              31.75    33.40    35.65           37.90    40.10
           2"                41.00    43.15    46.05           48.90    51.80
           3"                72.50    76.30    81.40           86.50    91.60
           4"               104.25   109.75   117.05          124.35   131.70
           6"               171.75   180.80   192.85          204.90   216.95
           8"               249.00   262.10   279.60          297.05   314.55
          10"               310.75   327.10   348.90          370.70   392.55
          12"               437.50   460.55   491.25          521.95   552.65

Quantity Charge $/CCF
      0-300 CCF              $0.82
    Over 300 CCF             $0.69
   All Consumption                    $1.02    $1.21           $1.40    $1.58


                                                                                52
               Overview of Proposed
               Rate - $240M DWSP
                           Present             Proposed Water Rates
                           Water      FY       FY               FY      FY
   Rate Components         Rates     2010     2011             2012    2013

Monthly Service Charge -
      5/8" Meter            $14.25   $15.00   $16.00          $17.25   $18.25
          3/4"               16.75    17.65    18.80           20.30    21.45
           1"                22.00    23.15    24.70           26.65    28.20
         1-1/2"              31.75    33.40    35.65           38.45    40.65
           2"                41.00    43.15    46.05           49.65    52.50
           3"                72.50    76.30    81.40           87.75    92.85
           4"               104.25   109.75   117.05          126.20   133.50
           6"               171.75   180.80   192.85          207.90   219.95
           8"               249.00   262.10   279.60          301.40   318.90
          10"               310.75   327.10   348.90          376.15   398.00
          12"               437.50   460.55   491.25          529.60   560.30

Quantity Charge $/CCF
      0-300 CCF              $0.82
    Over 300 CCF             $0.69
   All Consumption                    $1.02    $1.21           $1.45    $1.68



                                                                                53
                 Example Large User Rate Impacts
                                                     FY 2010 Rates

                                       Comparison of Present and Proposed 2010 Rates at
                                           Varying Consumption Levels ($/Month)
                 $1,200.00


                 $1,000.00


                  $800.00
  Monthly Bill




                  $600.00


                  $400.00


                  $200.00


                    $0.00
CCF Usage                     100       200       300       400       500       600       700       800       900       1,000
Present Rates                $123.00   $205.00   $287.00   $356.00   $425.00   $494.00   $563.00   $632.00   $701.00   $770.00
Proposed 2010 Rates          $145.15   $247.15   $349.15   $451.15   $553.15   $655.15   $757.15   $859.15   $961.15   $1,063.15



    **Assumes a 2” meter charge
                                                                                                                          54
                                Large User Rate Impacts
                                                       FY 2010 Rates
                                                               (continued)

                                        Comparison of Present and Proposed 2010 Rates at
                                            Varying Consumption Levels ($/Month)
                  $14,000.00


                  $12,000.00


                  $10,000.00
   Monthly Bill




                   $8,000.00


                   $6,000.00


                   $4,000.00


                   $2,000.00


 CCF Usage            $0.00
                                1,500      2,000    2,500      3,000     3,500     4,000     5,000     7,500    10,000    12,000

 Present Rates                 $1,115.00 $1,460.00 $1,805.00 $2,150.00 $2,495.00 $2,840.00 $3,530.00 $5,255.00 $6,980.00 $8,360.00
 Proposed 2010 Rates $1,573.15 $2,083.15 $2,593.15 $3,103.15 $3,613.15 $4,123.15 $5,143.15 $7,693.15 $10,243.15 $12,283.15


**Assumes a 2” meter charge
                                                                                                                               55
                   Large User Rate Comparison
                    With Neighboring Utilities
                                Comparison of Monthly Water Bills at 2,000 CCF
$6,000.00



$5,000.00



$4,000.00



$3,000.00



$2,000.00



$1,000.00



   $0.00
            Stockton    Stockton                             Cal Water -
                                     Modesto     Lathrop                   Pleasanton     Tracy     Brentwood   Manteca
            (Present)   (FY 2010)                             Stockton
            $1,460.00   $2,083.15    $2,610.79   $3,131.50   $3,181.80     $3,385.60    $3,625.80   $4,807.03   $4,966.90




                                                                                                                      56
                Average Customer
                 4 Year Impacts
    120.0%

    100.0%

     80.0%

     60.0%
     40.0%

     20.0%

         0.0%




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                           Year 1   Year 2   Year 3   Year 4

**Assumes a 2” meter charge
**Average monthly Commercial consumption of 120 ccf
**Average monthly Institutional consumption of 550 ccf
                                                               57
**Average monthly Industrial consumption of 2,000 ccf
Summary of Large User Impacts

   Primarily driven by
    change in rate
    structure
    – Shift to a conservation
      based rate structure
   Impacts will vary based
    on the level of
    consumption


                                58
      Summary of the Water
          Rate Study
 Developed    proposed rate levels to
  financially support the DWSP
 Developed a rate transition plan

 Proposed a rate design option that would
  move the City towards conservation-
  based rates
 Attempted to minimize the impacts to
  individual customers
                                             59
              Next Steps

 Review by Council Water Committee 4/23
 2nd Meeting of Large Water Users 5/4
 Final review by Council Water Committee
  and recommendation to City Council 5/13
 City Council to consider issuance of
  45-day public notice 5/19
 Two additional public meetings in June
 City Council consideration 7/7

                                            60
Questions/Answers and
      Feedback




                        61

								
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