City of Alexandria, Virginia
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MEMORANDUM
DATE: APRIL 26, 2017
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: MARK B. JINKS, CITY MANAGER /s/
DOCKET TITLE:
TITLE
Final Passage on an Ordinance to Bring the Sewer Line Maintenance Charge Set Forth Therein into Conformity with the Previously Adopted Resolution Setting the Fee at $1.82 per 1,000 Gallons of Water Supplied. [ROLL-CALL VOTE]
BODY
ISSUE: Passage of an ordinance to increase the sanitary sewer line maintenance charge from $1.40 to $1.82 per 1,000 gallons of water.
RECOMMENDATION: That City Council adopt the proposed ordinance on Thursday, May 4, 2017. The new fee will be effective July 1, 2017.
BACKGROUND: The Sanitary Sewer Line Maintenance Charge (i.e. usage fee) was established to assist in recovering the costs of maintaining, inspecting and improving public sanitary sewer facilities in the City. During the FY 2004 budget process, staff outlined a proposal to begin a multi-year plan to increase the City’s sanitary sewer fee so that the sanitary sewer costs are fully recovered from fees and other outside sources. Since then, the fees continue to cover the full costs, with the last increase in fees in FY 2017, when the fee increased from $1.25 to $1.40 per 1,000 gallons used. City Council has also discussed changing the name of the fee to more appropriately reflect the purposes towards which the fee will be applied. Staff has reviewed naming alternatives and recommends “Sanitary Sewer System Capital Investment and Maintenance Fee”.
DISCUSSION: The balanced sanitary sewers ten-year plan proposes a 30% rate increase in
FY 2018 to a Sewer Line Maintenance Fee of $1.82 per 1,000 gallons. The FY 2018 increase will allow the City to implement its Combined Sewer Outfall (CSO) plans and respond to recent State legislation adopted by the General Assembly and signed by the Governor. CSO improvements which are estimated to cost up to $400 million it is projected that the City’s portion of the sanitary sewer rates will climb some 500% over the next 10 years.
The typical monthly sanitary sewer bill paid to Alexandria Renew Enterprises is approximately $46 per month. Currently, the City’s portion of that monthly bill is approximately $6.30 per month or approximately $75.60 per year. The proposed increase will cost the typical household approximately $8.19 per month or approximately $98.28 per year on the City’s portion of the sanitary sewer bill.
At the public hearing on April 22, 2017, staff was asked to present options for renaming the “Sewer Line Maintenance Charge” so it would better reflect the planned increases for capital investment related to the combined sewer system. Staff developed options and based on City Council’s input, proposes “Sanitary Sewer System Capital Investment and Maintenance Fee.” If Council chooses to proceed with the renaming, it will need to make a motion and approve the change as part of final passage. Staff will then update the ordinance and language on all City related communications and coordinate with AlexRenew to change the monthly bills.
FISCAL IMPACT: The proposed rate increase in the Sewer Line Maintenance charge will generate an estimated $2.1 million in additional revenue, for a total of $8.9 million which would be available annually to fund all City-related sanitary sewer operating and capital costs, including the funds necessary to take the next steps in implementing the CSO fixes. The funding and rate increase plan for FY 2019 and beyond would be subject to change, as changes to the City’s sanitary sewer capital and operating needs, cost estimates for the CSO projects are better known, and as federal and state environmental requirements change.
ATTACHMENTS:
1. Ordinance Cover
2. Ordinance
STAFF:
Emily A. Baker, P.E., Deputy City Manager
Morgan Routt, Director, Office of Management & Budget
Yon Lambert, AICP, Director, T&ES
William Skrabak, Deputy Director, T&ES