HomeMy WebLinkAbout2021-08-19 e-packet@5:00Thursday, August 19, 2021
5:00 PM
City of South San Francisco
P.O. Box 711 (City Hall, 400 Grand Avenue)
South San Francisco, CA
TELECONFERENCE MEETING
Budget Standing Committee of the City Council
Special Meeting Agenda
August 19, 2021Budget Standing Committee of the
City Council
Special Meeting Agenda
TELECONFERENCE MEETING NOTICE
THIS MEETING WILL BE CONDUCTED PURSUANT TO THE PROVISIONS OF THE
GOVERNOR’S EXECUTIVE ORDERS N-29-20 AND N-63-20 ALLOWING FOR DEVIATION
OF TELECONFERENCE RULES REQUIRED BY THE BROWN ACT & PURSUANT TO THE
ORDER OF THE HEALTH OFFICER OF SAN MATEO COUNTY DATED MARCH 31, 2020 AS
THIS MEETING IS NECESSARY SO THAT THE CITY CAN CONDUCT NECESSARY
BUSINESS AND IS PERMITTED UNDER THE ORDER AS AN ESSENTIAL
GOVERNMENTAL FUNCTION.
The purpose of conducting the meeting as described in this notice is to provide the safest environment for staff
and the public while allowing for public participation.
Mayor Addiego, Councilmember Nicolas and essential City staff will participate via Teleconference.
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Page 2 City of South San Francisco Printed on 9/29/2021
August 19, 2021Budget Standing Committee of the
City Council
Special Meeting Agenda
American Disability Act: The City Clerk will provide materials in appropriate alternative formats to
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Call To Order.
Roll Call.
Agenda Review.
Remote Public Comments - comments are limited to items on the Special Meeting Agenda.
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of time for public comments (Gov. Code sec. 54954.3.(b)(1).). Comments that are not in compliance with the
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made live.
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Page 3 City of South San Francisco Printed on 9/29/2021
August 19, 2021Budget Standing Committee of the
City Council
Special Meeting Agenda
HOW TO PROVIDE PUBLIC COMMENT DURING THE MEETING
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MATTERS FOR CONSIDERATION
Motion to approve the Minutes for the meeting of May 24, 2021.1.
Overview of the South San Francisco Sewer Fund and structuring the next five-year
sewer rate plan. (Mike Futrell, City Manager, Janet Salisbury, Finance Director, and
Brian Schumacker, Plant Superintendent)
2.
Adjournment.
Page 4 City of South San Francisco Printed on 9/29/2021
City of South San Francisco
Legislation Text
P.O. Box 711 (City Hall, 400
Grand Avenue)
South San Francisco, CA
File #:21-553 Agenda Date:8/19/2021
Version:1 Item #:1.
Motion to approve the Minutes for the meeting of May 24, 2021.
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Call to Order. Time: 1:04 p.m.
Roll Call. PRESENT: Councilmember Nicolas and
Mayor Addiego.
AGENDA REVIEW
No changes
REMOTE PUBLIC COMMENTS
None
MATTERS FOR CONSIDERATION
1. Motion to approve the Minutes for the meeting of April 26, 2021.
Motion – Councilmember Nicolas / Second –Mayor Addiego: to approve the minutes. Councilmember
Nicolas submitted a minor correction to the minutes. The motion carried unanimously.
2. Report regarding the City of South San Francisco Operating Budget for Fiscal Year 2021-22.
(Janet Salisbury, Finance Director)
Director Salisbury introduced the item and provided a budget overview, General Fund projections and
General Fund summary for Fiscal Year 2021-22.
In 2017, the City made the strategic shift away from a one-year operating budget cycle to a biennial
operating budget cycle. The current fiscal year (FY) 2020-21 represents the second year of the FY 2019-
21 biennial operating budget, which was adopted by Council on June 26, 2019.
However, with the extraordinary economic downturn stemming from the COVID-19 global pandemic,
significant adjustments were made to both the FY 2019-20 and FY 2020-21 budgets to react to the
MINUTES
SPECIAL MEETING
BUDGET STANDING
COMMITTEE
OF THE
CITY OF SOUTH SAN FRANCISCO
P.O. Box 711 (City Hall, 400 Grand Avenue)
South San Francisco, California 94083
MONDAY, MAY 24, 2021
1:00 p.m.
Teleconference via Zoom
Housing Standing Committee conducted this meeting
in accordance with California Governor Newsom’s
Executive Orders N-25-20 and N-29-20 and COVID-
19 pandemic protocols.
SPECIAL BUDGET STANDING COMMITTEE MEETING MAY 24, 2021
MINUTES PAGE 2
dynamically changing conditions. And while the American economy showed sign of recovery, bolstered
by the unprecedented stimulus packages from the Federal government as well as the broader availability
of vaccines in the U.S., the economic fundamentals remain uneven and uncertainty persists. As a result,
for FY 2021-22, staff was pursuing an annual budget, as opposed to a biennial budget for the upcoming
FY. The goal was to resume the two-year budget cycle once the economy showed signs of stabilization
and longer-term recovery, as biennial budgeting generally requires a longer commitment of policy
direction and funding levels.
The General Fund is the City’s largest and core operational fund, where the bulk of the essential services
delivered by departments such as Economic and Community Development, Fire, Library, Parks and
Recreation, Police, Public Works and City Administration are budgeted.
While the current FY had not yet closed, it was the expectation that with tight controls on departmental
expenditure budgets, the FY would end as expected. To remind the Budget Standing Committee, when
the FY 2020-21 was adopted, the expectation was that the operating shortfall and additional Capital
Improvement Projects (CIP) for FY 2020-21 would be funded through the General Fund surplus of the
prior year (FY 2019-20).
One of the largest unexpected monetary considerations to emerge in the current 2020-21 FY was the
shortfall in property tax in lieu of Vehicle License Fee (VLF). Simply, due to a reduction in the number
of non-basic aid school in the County, there was a shortfall in terms of how much property tax was
available for the VLF due to cities and county. For South San Francisco, the amount due in VLF for FY
2020-21 was $8.6 million. However, the City would only collect $4.9 million this year; the effective VLF
shortfall is approximately $3.7 million. A claim for the VLF shortfall would be filed with the State in
August 2021, but whether the City collects on that claim would be dependent upon appropriation in the
State’s budget.
Staff expects that the negative impacts of the $3.7 million in VLF shortfall would largely be curtailed by
stronger revenues in other areas along with tough expenditure controls at the departmental level.
However, final results for the current FY would not be determined until the books were closed and the
accounts audited.
For the upcoming FY 2021-22, the Finance Department projected operating revenues of $108,797,657
(not including carryover purchase orders) and $112,084,085 in operating expenditures, with the net
operating shortfall of $3,290,000 to be funded via the fund balance available from the FY 2019-20
surplus and/or the federal stimulus available through the American Rescue Plan (ARP) Act. While the
funds have not yet been received, South San Francisco’s ARP allocation was $12.3 million, with half
available in calendar year 2021, and the other half available in calendar year 2022. Projects to be funded
with the remaining ARP allocations would go to Council as dedicated and separate actions, as was the
case recently for the San Mateo County Strong Restaurant, Brewery & Winery Grant Program and the
establishment of the Economic Mobility Resource Hub.
South San Francisco was well positioned to recover economically from COVID-19, with a large
industrial base anchored by the world’s largest biotechnology research center. It was expected that the
negative economic impact of COVID-19 would linger throughout FY 2021-22, as businesses recover,
restaurants reopen, air travel (both domestic and international) improved, and hotel occupancy increases.
Property Tax, which remained the City’s largest revenue component, was projected to be $41.1 million in
FY 2021-22. Property tax revenues have increased at an annual rate of 6% per year over the last seven
SPECIAL BUDGET STANDING COMMITTEE MEETING MAY 24, 2021
MINUTES PAGE 3
years, redolent of a booming economy and a high rate of development. However, included in the property
tax figures are the property tax in lieu of VLF. While projecting a 6% growth rate in secured and
unsecured property taxes, the overall growth in property tax projections was tempered by the risk of
further reductions of non-basic aid schools, resulting in additional VLF shortfalls such as those we have
seen in the current FY.
Sales Tax revenue (without Measure W proceeds) was expected to increase to $19.4 million or about 5%
as the economy recovers from the acute effects of the pandemic. The sales tax forecast was provided by
the City’s sales tax consultant as the best estimate available at this time.
Transient Occupancy Tax (TOT) revenue grew by 22% from March 2019 to March 2020 but was the
hardest hit revenue source due to COVID-19. While the domestic leisure travel showed sign of recovery,
the City’s TOT revenue, which was highly dependent on business travel, remained beleaguered. It was
widely recognized that there was a race between widespread vaccination and mutations, and it was
expected that high levels of global immunizations may be a necessary threshold for business/international
travel to resume to pre-COVID levels. When setting the FY 2020-21 budget a year ago, the original TOT
projection was $7.9 million—a dramatic decline from the $17 million actually collected in the non-
COVID fiscal year of 2018-19. However, by mid-year review, it was evident that the local hotel industry
would not recover as shelter-in-place mandates were re-instated throughout much of California in the last
quarter of 2020. As a result, TOT revenue projections for the current year, FY 2020-21, was further
reduced to $5.9 million. Based upon the actual collections to date, staff expected to be right on track and
meet that further reduced forecast of $5.9 million. Given the current trend of monthly TOT collections,
staff was projecting about a 20% recovery in the local hotel industry, and thereby proposing a TOT
projection of $7.1 million. Staff expected to adjust that projection at mid-year should additional signs of
recovery in the hotel sector emerge.
Licenses and Permit revenue had increased year-over-year since 2015. For FY 2021-22, staff was
projecting revenues of $16.5 million, indicative of the robust rate of development expected especially
East of 101.
Charges for Services revenues, second only to TOT, had suffered the most because of the pandemic.
While revenue projections were further reduced by almost $1 million from $8 to $7 million as part of the
mid-year review, the expectation was that actual revenue collections may fall short, largely due to the
limited programming in Parks and Recreation. For FY 2021-22, staff projected recovery to pre-COVID
levels of $9.3 million considering nominal increases in overall charges as well as the expectation of pent-
up demand for recreation activities in the coming year.
In FY 2021-22 the City’s General Fund, with projected revenues of $108,797,568, net of any carryover
purchase orders, and $112,084,085 in expenditures, required an additional $3,290,000 to achieve a
balanced budget. Staff recommended applying the balance from the FY 2019-20 budget surplus still
remaining as fund balance in the General Fund. Any ARP monies that were allocated as General Fund
support could then “reimburse” the General Fund at a later time once final determinations were made by
Council related to the appropriation of ARP funded projects.
Mayor Addiego queried the 10% drop for the Public Works Department. Director Salisbury stated the
10% drop was attributed to the Measure A Free Shuttle revenue source $1,000,000 appropriation that was
not in the current budget.
SPECIAL BUDGET STANDING COMMITTEE MEETING MAY 24, 2021
MINUTES PAGE 4
Director Salisbury advised there were three positions that were being requested in the FY 2021-22
budget. The City Manager’s Office requested the addition of one (1) full-time equivalent hourly staff
member to provide additional administrative and programmatic support. The Economic & Community
Development Department (ECD) requested the addition of one (1) hourly staff member to provide
additional programmatic support. The employee would support ECD in such efforts as the establishment
of the Economic Mobility Hub and other mission-critical projects. The Finance Department requested the
addition of a Financial Analyst II to provide vital support necessary to implement a new Enterprise
Resource Planning platform.
In conclusion, staff advised that the City remained financially strong, with a AAA-rated credit rating. The
breadth and depth of the economic downturn associated with COVID-19, however, continued to make a
sustained impact on the City’s finances. Staff recommended a conservative budget approach with
minimal reliance on city reserves to preserve the City’s ability to respond over time if the economic
downturn deepens further as well as to fund critical infrastructure projects necessary throughout the City.
3. Report regarding proposed Capital Improvement Program for fiscal year 2021-22. (Eunejune
Kim, Director of Public Works/City Engineer and Matthew Ruble, Principal Engineer)
The following individuals provided public comment:
• Alan Perez, community member
• Daniel Perez, community member
• Olga Perez, community member
Principal Engineer Ruble introduced the item and provided an update regarding the proposed Capital
Improvement Program (CIP) for FY 2021-22. The FY 2021-22 CIP included 150 projects: 9 new
projects, 33 potential projects and 108 continuing projects. The FY 2021-22 CIP budget was
approximately $120,000,000 and was comprised of six (6) project types: Public Facilities, Parks, Storm
Drains, Sanitary Sewer, Streets and Traffic.
Principal Engineer Ruble gave a grief overview and identified the proposed new projects and additional
appropriation request for continuing projects.
New project (pf2201) City Hall Fire Alarm and Electrical Modernization – project would upgrade City
Hall electrical service to support additional holiday decoration plans / EV charging station installation -
$100,000.
New project (pf2202) Grand Library History Room Renovation – project would plan and scope
renovation to support ADA access - $50,000. Mayor Addiego was concerned of the small space and
suggested looking into building a History Room in the new library. It was concluded for staff to revisit
the item to the Budget Standing Committee at a later date.
New project (pf2203) Terrabay Gymnasium – project would replace the HVAC at the Terrabay
Gymnasium - $600,000.
New project (sd2201) Francisco Terrace Flood Protection Levy – construct a flood wall behind the
Francisco Terrace neighborhood to minimize flooding during storm events - $120,000.
New project (sd2202) Colma Creek Pedestrian Bridge Replacement – replace existing pedestrian bridge
with new bridge at a higher elevation to alleviate impacts caused by current alignment impeding flow
SPECIAL BUDGET STANDING COMMITTEE MEETING MAY 24, 2021
MINUTES PAGE 5
during storm events - $250,000.
New project (ss2201) Country Club Park Sewer Master Plan – district level study of sewer service
expansion into the Country Club neighborhood; connecting to the existing sanitary sewer system. The
project includes topographic and utility surveys, sewer modeling, and analysis - $210,000.
New project (tr2201) Grand Avenue Off-Ramp Realignment – project to conduct preliminary studies and
feasibility to realign the US101 northbound Grand Avenue Off-Ramp, eliminating vehicle pedestrian
conflicts of the current configuration - $750,000.
New project (tr2202) Highway Safety Improvement Program (HSIP) Curb Ramp Improvements – project
improves pedestrian crossing facilities, bringing the existing non-ADA compliant curb ramps up to
current standards and replacing old and faded crosswalks with high-visibility, thermoplastic striping at
six (6) non-signalized intersections along Olive Avenue, Linden Avenue, and Walnut Avenue - $324,000.
New project (tr2203) E101 Transit Shelter and Bullbout Grant from MTC – project would add 11 new
on-street bus/shuttle stops, upgrade two existing stops, and enhance sidewalks and crosswalks in a
growing employment center that generally lacks bus stop facilities. The upgrades improve safe access to
jobs, reduce travel times for Commute.org and Genenteh shuttles, and provide the necessary
infrastructure to extend bus service via the Reimagine SamTrans project - $55,056.
In conclusion, staff would amend the FY 2021-22 CIP based upon direction received from the Budget
Standing Committee, and will present the revised CIP at the June 15, 2021 City Council Study Session.
City Manager Futrell advised the next Budget Standing Committee meeting was scheduled for June 9,
2021 to hear the proposed five (5) year Sewer Rate Plan and Stormwater Rate Plans.
ADJOURNMENT
Being no further business Mayor Addiego adjourned the meeting at 2:18 p.m.
Submitted by: Approved by:
Gabriel Rodriguez Mark Addiego
Deputy City Clerk Mayor
Approved by the Budget Standing Committee: / /
City of South San Francisco
Legislation Text
P.O. Box 711 (City Hall, 400
Grand Avenue)
South San Francisco, CA
File #:21-322 Agenda Date:8/19/2021
Version:1 Item #:2.
Overview of the South San Francisco Sewer Fund and structuring the next five-year sewer rate plan.(Mike
Futrell, City Manager, Janet Salisbury, Finance Director, and Brian Schumacker, Plant Superintendent )
RECOMMENDATION
Staff recommends that the Budget Standing Committee evaluate the proposed five-year sewer rate plan and
provide direction before presentation to the full City Council meeting tentatively scheduled for September 8,
2021.
BRIEF
§Sewer rates fund ongoing operation and maintenance and capital improvement projects required to
collect and treat wastewater.
§The City of South San Francisco's sewer rate is approximately 37%below the San Mateo County
average.
o Since Fiscal Year (FY)2011-12,South San Francisco has only increased sewer fees by 3.5 %
each year (on average) while meeting mandates and infrastructure maintenance needs.
o The City has reduced or waived previously-adopted annual rate increases in two of the past five
years due to savings realized through operational efficiencies.
§The City of South San Francisco shares some of these costs with partner agencies.
§Bartle Wells Associates (BWA)completed a comprehensive Sewer Rate Plan Study in 2021 and
developed five-year rate projections under two scenarios:
Recommended Scenario
2022-23 2023-24 2024-25 2025-26 2026-27
Maximum Increase 3% 3% 3% 3% 3%
Reduced Scenario
2022-23 2023-24 2024-25 2025-26 2026-27
Maximum Increase 2% 2% 2% 2% 2%
§The maximum recommended 3% increase per year provides the following benefits:
o Generates an additional $4 million in sewer fund revenues over the next five years,providing
additional funding for capital needs while minimizing impacts to existing fund balance; and
o The compounding effect of the marginal increases over five years lends itself to continued low
rate increases in future years.
§The most recent Comprehensive Annual Financial Report (CAFR)report shows a sewer fund balance of
approximately $25 million.Both scenarios assume a partial drawdown of fund balances for capital
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File #:21-322 Agenda Date:8/19/2021
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project funding needed in upcoming years.
o The 3% maximum per year rate plan draws down approximately $5 million.
o The 2% maximum per year rate plan draws down roughly $8.4 million.
§Under both scenarios,South San Francisco's residential rates will remain among the lowest in San
Mateo County.
§Based on the BWA Sewer Rate Plan Study and the benefits mentioned above,staff supports the
Recommended Scenario.
BACKGROUND/DISCUSSION
Section One - Sewer Fund Overview
The City accounts for all sewer operation transactions in a dedicated fund -the Sewer Enterprise Fund (Sewer
Fund).All aspects of the City's sewer operations,including collection,conveyance,and treatment of residential
and commercial wastewater,are all tracked within the Sewer Fund.Some of the operating revenues and costs
are attributable to partner agencies that use the City's sewer system.
The City Collects sewer revenues to fund various expenditures, including:
§The Federal Pretreatment Program;
§The operation, maintenance, and repair of the sewer collection system;
§The construction of new sewer collection systems;
§Construction of new treatment systems at the WQCP;
§Debt service payments; and
§The operation,maintenance,and repair of all sewer facilities include sanitary sewer pump stations and
the South San Francisco-San Bruno Water Quality Control Plant (WQCP).
Fund Revenues
Typical Annual Revenues
South San Francisco $23,000,000
San Bruno $3,375,109
Colma $860,000
Daly City $260,000
TOTAL $27,495,109
Section Two - Current Five-Year Rate Plan
The sewer rate plan prepared by BWA in 2017 (2017 BWA Rate Study)proposed maximum rate increases in
years one through five of 15%,10%,5%,5%,5%,respectively.At the public hearing,City staff recommended
reducing the rate increases to help keep sewer rates as affordable as possible.As a result,the adopted rates
included annual adjustments of 13%,10%,2%,2%,2%-roughly 14%lower than the rates initially suggested
in the 2017 BWA Rate Study.
The City annually reviews maximum adopted sewer rates and reduces or waives increases when fiscally
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File #:21-322 Agenda Date:8/19/2021
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The City annually reviews maximum adopted sewer rates and reduces or waives increases when fiscally
prudent.The City lowered the rate increase adopted for FY 2018-19 from 10%to 9%and waived the 2%rate
increase previously adopted for FY 2020-21.
While the City's reduction of prior-year rate increases has helped keep the City's sewer charges as affordable as
possible,the declines have also resulted in lower annual revenues in FY 2021-22 than previously forecasted.
Current projections indicate a temporary sewer rate revenue shortfall in FY 2021-22.The temporary revenue
decrease is because South San Francisco bases commercial sewer billing on water use from the previous
calendar year.Because many businesses used significantly less water due to the COVID-19 pandemic and
accompanying shelter in place order,staff anticipates that sewer revenues will be lower than expected.These
commercial rate revenue shortfalls will phase out over the next few years as business activities return to pre-
COVID levels.
Section Three - New Capital Improvement Projects Driving the New Sewer Rate Plan
Staff forecasts approximately $50.5 million worth of capital project costs over the next five-year rate plan
cycle.San Bruno and other system users will fund roughly $8.1 million,resulting in $42.4 million in capital
funding needs for South San Francisco.The following are the estimated project infrastructure investments over
the next five years:
§Sanitary sewer rehabilitation ($12.6 million)
§Other sanitary sewer system capital improvements ($5.2 million)
§WQCP Wet Weather and Digester Project ($4.1 million of remaining funding needs)
§WQCP Solar Photovoltaic System ($1.2 million)
§WQCP equipment replacement and process efficiency projects ($1.1 million)
§Completion of Secondary Clarifiers No. 1 and 2 rehabilitation project ($3.8 million)
§Plant-wide painting and industrial equipment coating ($10.6 million)
§Joint project with the Army Corp of Engineers to protect the WQCP infrastructure against sea-level rise
($8.3 million)
§Dissolved Air Floatation Thickener (DAFT) System Rehabilitation ($2.5 million)
§Other sewer systems projects including,master planning,design,and process control improvements
($1.1 million)
Section Four - Projected Five-Year Sewer Rate Increases
City staff partnered with BWA,an independent utility rate consulting firm that the City has previously worked
with,to develop the sewer rate projections for the next five years.Staff based the rate projections on updated
financial projections designed to evaluate future funding needs.
BWA developed the financial and rate projections under two scenarios including:
§Recommended scenario 3% maximum annual rate increases
§Reduced plan 2% maximum yearly rate increases
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Both scenarios include financial provisions for:
§The City's current fiscal year budget with 4% annual cost escalation for financial planning purposes;
§The sewer enterprise's projected share of yearly payments for CALPERS Unfunded Accrued Liabilities
(UAL),the total current and expected future pension obligations,vs.the actuarial value of assets and the
present value of future pension costs. The City expects these costs to increase over the next ten years;
§Phase-in of an additional $1 million over the next five years for wet weather cost recovery;
§Debt service funding requirements, including the new Clean Water State Revolving Fund Loan; and
§Anticipated capital improvement projects assuming all capital improvement project funding on a pay-as
-you-go basis using available fund balances and rate revenues,without need for additional debt
financing.
The Recommended Scenario includes slightly higher rate increases to provide additional revenue to offset
losses from the COVID-19 pandemic and support the ongoing funding for capital improvement needs.The
most recent CAFR report shows a sewer cash balance of approximately $25 million.Projections show that
under the 3%maximum increase scenario,the sewer fund cash assets will decrease by only $5.2 million over
the next five years.The recommended rate increases provide the City with additional financial flexibility over
the next five years and lower rate increases in future years.
The reduced 2%maximum increase scenario decreases the sewer cash assets by $8.4 million over the next five
years and increases future year rate plans.
Impact on the Rate Payer
The Recommended Scenario results in a monthly increase of $10 per month over the five-year rate plan;in
comparison,the Reduced Scenario results in a $6.50 per month increase-a difference of $42.00 a year at the end
of the fifth year.
Section Five - Sewer Rate Comparison to Other San Mateo County Agencies and Next Steps
Staff compared the City's sewer rates to other agencies in San Mateo County.The City's current rate for a single
-unit residence (single-family home)is $62.75 per month.The City's current sewer rates are among the lowest
rates in San Mateo County,approximately 37%below the regional average.South San Francisco's rates will
remain among the lowest in San Mateo County (Attachment A).
Next Steps:
§ Seek a conceptual approval of the new sewer rate plan by the City Council
§ Conduct a public information meeting on the sewer rate plan
§ Mail rate increase notices to all residential and business customers
§ City Clerk receives any protest notices
§ Hold a public hearing and tabulate any protest notices
§Gain final approval of rate plan by City Council
§Update County property/parcel database
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File #:21-322 Agenda Date:8/19/2021
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§The new five-year rate plan goes into effect in FY 2022-23
RELATIONSHIP TO THE STRATEGIC PLAN
The City of South San Francisco promotes public health and environmental stewardship.Continuing to fund
wastewater infrastructure systems positively affects the quality of life for South San Francisco residents by
protecting public health and safety.
FISCAL IMPACT
Sewer fees fund the collection,conveyance,and treatment of residential and commercial wastewater.The
Recommended Scenario keeps revenues aligned with the service cost and achieves balanced budgets while
maintaining adequate fund reserves.
CONCLUSION
Staff recommends a five-year sewer rate plan with maximum annual increases of 3%and seeks feedback and
direction from the Budget Standing Committee before presentation to the full City Council for adoption
tentatively scheduled for September 8, 2021.
Attachments:
2021 Bartle Wells Associates South San Francisco Sewer Rate Study - Tables
Staff Presentation
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Sewer Rate Study
Draft Tables 8/5/21
City of South San Francisco
10.4250.0024.5019.7434.4462.75 76.8385.4445.9733.570.3397.34 47.3432.27102.00106.9383.8091.8815.37 132.08145.17295.2527.5025.9034.5522.7346.1661.5626.3750.9968.0436.4134.4637.92 50.00 50.40 54.29 57.17 62.75 76.83 85.44 92.13 95.06 96.71 97.34 98.33 100.31 102.00 106.93 120.21 126.34 130.42 132.08 145.17 $0$25$50$75$100$125$150$175Sewer Usage ChargesFixed or Minimum ChargesSingle Family Residential Monthly Sewer RatesBased on flat rate or 5.5 hcf of monthly winter water useRates effective April 2021FY2021/222% Increase
51.9257.1374.5370.2889.6568.7457.1358.4157.1374.4870.6376.4281.4157.1397.1987.4089.65133.95104.5654.2962.7550.0057.1750.4085.4498.3397.34106.9392.13102.0096.71100.31132.0895.06120.21145.17126.34295.25106.21 119.88 124.53 127.44 140.05 154.18 155.45 155.75 164.06 166.61 172.63 173.13 181.72 189.21 192.25 207.61 234.82 260.28 $0$50$100$150$200$250$300$350 Sewer Charges: Flat rate or 5.5 hcf monthly winter use Water Charges: Base meter size with 6 hcf monthly useCombined Monthly Water & Sewer Bill SurveySingle Family ResidenceRates effective January 2021399.81
Table 1Note: City adopted reduced rates that were lower than proposed and then further reduced rates implementedSouth San FranciscoCurrent rates are 12.4% below original proposed ratesHistorical Sewer RatesSewer rate increases have averaged 3.6% per year over the period shownBasis of Calculation 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22Rate Increase %: Proposed15% 10% 5% 5% 5%Rate Increase %: Adopted 0% 0% 4% 4% 2% 13% 10% 2% 2% 2%Rate Increase %: Implemented 0%0%4%4%2%13%9%2%0%2%reduced cancelledRESIDENTIALFixed annual charge per residential dwelling unit.Single Unit Residential Dwelling Unit $532 $532 $532 $553 $575 $588 $664 $724 $739 $739 $753Multi‐Unit Residential Dwelling Unit 532 532 532 516 516 527 596 650 663 663 676Trailer Unit Residential Dwelling Unit 477 477 477 496 516 527 596 650 663 663 676COMMERCIAL / INSTITUTIONALVolumetric charges per ccf of inflow or effluent, subject to a minimum annual charge.Light Strength Commercial Minimum Charge 532 532 532 553 575 588 664 724 739 739 753Hundred Cubic Feet Inflow 7.0478 7.0478 7.0478 7.4028 7.40287.5508 8.5324 9.30039.4863 9.4863 9.6761or Effluent 7.8336 7.8336 7.8336 8.2253 8.2253 8.3898 9.4805 10.333710.5404 10.5404 10.7512Moderate Strength Commercial Minimum Charge 532 532 532 553 575 588 664 724 739 739 753Hundred Cubic Feet Inflow 11.0325 11.0325 11.0325 11.5849 11.584911.8166 13.3528 14.554514.8456 14.8456 15.1425or Effluent 12.2591 12.2591 12.2591 12.8721 12.8721 13.1295 14.8363 16.171616.4950 16.4950 16.8249Restaurants Minimum Charge 532 532 532 553 575 588 664 724 739 739 754Hundred Cubic Feet Inflow 16.1205 16.1205 16.1205 16.9261 16.926117.2646 19.5090 21.264821.6901 21.6901 22.1239or Effluent 17.9112 17.9112 17.9112 18.8068 18.8068 19.1829 21.6767 23.627624.1001 24.1001 24.5821Institutions Minimum Charge 532 532 532 553 575 588 664 724 739 739 753Hundred Cubic Feet Inflow 5.6881 5.6881 5.6881 5.9711 5.97116.0906 6.8824 7.50187.6518 7.6518 7.8049or Effluent 6.3187 6.3187 6.3187 6.6346 6.6346 6.7673 7.6470 8.33538.5020 8.5020 8.6720Septage Haulers Charge per Gallon 0.3007 0.3007 0.3007 0.3157 0.31570.3220 0.3639 0.39660.4045 0.4045 0.4126INDUSTRIALVolumetric charges per ccf of inflow or effluent plus charges per pound for wastewater strength loadings of COD and TSS, subject to a minimum annual charge.Industrial Minimum Charge 532 532 532 553 575 588 664 724 739 739 753Hundred Cubic Feet Inflow 4.2231 4.2231 4.2231 4.4348 4.43484.5235 5.1116 5.57165.6830 5.6830 5.7967or Effluent 4.6929 4.6929 4.6929 4.9275 4.9275 5.0261 5.6795 6.19066.3145 6.3145 6.4408Chemical Oxygen Demand Pounds 0.4379 0.4379 0.4379 0.4598 0.4598 0.46900.5300 0.5777 0.5892 0.5892 0.6010Total Suspended Solids Pounds 1.4178 1.4178 1.4178 1.4887 1.4887 1.51851.7159 1.8703 1.9077 1.9077 1.9459One hundred cubic feet (ccf) equals approximately 748 gallons.Commercial sewer charges are based on annual water consumption from the prior calendar year.City offers a $76 discount pursuant to a Low‐Income Sewer Service Rebate Program based on income eligibility and participation in CalWater's Low Income Rate Assistance (LIRA) Program.
44.29 44.29 44.29 46.07 47.92 49.00 55.38 60.37 61.58 61.58 62.75 $20$30$40$50$60$70$802011/122012/132013/142014/152015/162016/172017/182018/192019/202020/212021/22Fiscal YearHistory of Sewer Rates per Single Family HomeFY2011/12 rate + 3.5% escalationMonthly Sewer Charge
Table 2
South San Francisco
Long Term Historical Rates per EDU
Fiscal Annual Multi‐Year
Year Rate/EDU Adopted Implemented Rate Increases
1999/00 $179 6.5% 6.5% 5‐Year Rate Plan
2000/01 188 5.0% 5.0%
2001/02 197 5.0% 5.0%
2002/03 207 5.0% 5.0%
2003/04 217 5.0% 5.0%
2004/05 272 25.0% 25.0% 5‐Year Rate Plan
2005/06 296 9.0% 9.0%
2006/07 323 9.0% 9.0%
2007/08 352 9.0% 9.0%
2008/09 383 9.0% 9.0%
2009/10 460 20.0% 20.0% 5‐Year Rate Plan
2010/11 506 10.0% 10.0%
2011/12 532 5.0% 5.0%
2012/13 532 0.0% 0.0%
2013/14 532 0.0% 0.0%
2014/15 553 4.0% 4.0% 3‐Year Rate Plan
2015/16 575 4.0% 4.0%
2016/17 588 2.0% 2.0%
2017/18 664 13.0% 13.0% 5‐Year Rate Plan
2018/19 724 10.0% 9.0%
2019/20 739 2.0% 2.0%
2020/21 739 2.0% 0.0%
2021/22 753 2.0% 2.0%
Rate Increase %
Table 3
South San Francisco
Sewer Customers by Class
2017/18 2018/19 2019/20 2020/21 2021/22
Residential
Single Unit 10,809 10,787 10,785 10,760 10,734
Multi Unit 1,750 1,768 1,773 1,788 1,803
Trailers 11111________________________________________
Subtotal 12,560 12,556 12,559 12,549 12,538
Commercial/Institutional/Industrial
Light Strength Comm'l (LTE) 1,204 1,203 1,201 1,204 1,196
Moderate Strength Comm'l (MOD) 182 191 193 194 194
Restaurant (RES) 109 116 117 119 125
Industrial (IND) 3333323231
Institutional (INS) 3432333333________________________________________
Subtotal 1,562 1,575 1,576 1,582 1,579
Other (Direct Billers, Septage Haulers)140 140 140 140 140
Total 14,262 14,271 14,275 14,271 14,257
Estimated Residential Dwelling Units
Single Unit 10,809 10,787 10,785 10,760 10,734
Multi Unit 5,322 5,322 5,306 5,683 6,176
Trailers 356 355 353 355 355________________________________________
Subtotal 16,486 16,464 16,444 16,798 17,265
Table 4
South San Francisco
Sewer Enterprise Fund 710 Cash Balances
2018 2019 2020 2021
Preliminary Est.
Cash & Investments $20,364,113 $20,652,375 $21,442,247 $25,992,912
Source: Comprehensive Annual Financial Reports and City estimates for June 30, 2021.
As of June 30
Table 5
South San Francisco
Outstanding Sewer Debt
Fiscal Year 1999 2004 2005 2008 2018
Ending SRF Loan SRF Loan Bonds SRF Loan SRF Loan Total
Loan Amount $44,000,000 $21,258,529 $6,000,000 $9,164,505 $53,403,000
Princ Forgiveness ($4,000,000)
Interest Rate 2.60% 2.50% 2.75% ‐ 5.00% 2.40% 1.80%
Repayment Term 20 Years 20 Years 20 Years 20 Years 20 Years
Reserve Req't $2,978,763 $1,382,335 $460,368 $432,998 $2,960,534
2021 $2,978,763 $1,382,335 $450,593 $432,998 ‐$5,244,689
2022 2,978,763 1,382,335 451,331 432,998 ‐5,245,427
2023 ‐1,382,335 450,000 432,998 ‐2,265,333
2024 ‐1,382,335 446,625 432,998 2,960,534 5,222,492
2025 ‐1,382,335 447,375 432,998 2,960,534 5,223,242
2026 ‐1,382,335 447,125 432,998 2,960,534 5,222,992
2027 ‐‐445,875 432,998 2,960,534 3,839,407
2028 ‐‐‐432,998 2,960,534 3,393,532
2029 ‐‐‐432,998 2,960,534 3,393,532
2030 ‐‐‐‐2,960,534 2,960,534
2031 ‐‐‐‐2,960,534 2,960,534
2032 ‐‐‐‐2,960,534 2,960,534
2033 ‐‐‐‐2,960,534 2,960,534
2034 ‐‐‐‐2,960,534 2,960,534
2035 ‐‐‐‐2,960,534 2,960,534
2036 ‐‐‐‐2,960,534 2,960,534
2037 ‐‐‐‐2,960,534 2,960,534
2038 ‐‐‐‐2,960,534 2,960,534
2039 ‐‐‐‐2,960,534 2,960,534
2040 ‐‐‐‐2,960,534 2,960,534
2041 ‐‐‐‐2,960,534 2,960,534
2042 ‐‐‐‐2,960,534 2,960,534
2043 ‐‐‐‐2,960,534 2,960,534
2044 ‐‐‐‐‐0
Final payment for 2005 Bonds can be funded by the Reserve Fund held by the Trustee.
Table 6
South San Francisco
San Bruno Share of Outstanding Sewer Debt
Fiscal Year 1999 2004 2005 2008 2018
Ending SRF Loan SRF Loan Bonds SRF Loan SRF Loan Total
San Bruno Share Fixed Pymts 32.7% None None 26.92%
2021 $589,551 $452,024 ‐‐‐$1,041,575
2022 589,551 452,024 ‐‐‐1,041,575
2023 ‐452,024 ‐‐‐452,024
2024 ‐452,024 ‐‐796,976 1,248,999
2025 ‐452,024 ‐‐796,976 1,248,999
2026 ‐452,024 ‐‐796,976 1,248,999
2027 ‐‐‐‐796,976 796,976
2028 ‐‐‐‐796,976 796,976
2029 ‐‐‐‐796,976 796,976
2030 ‐‐‐‐796,976 796,976
2031 ‐‐‐‐796,976 796,976
2032 ‐‐‐‐796,976 796,976
2033 ‐‐‐‐796,976 796,976
2034 ‐‐‐‐796,976 796,976
2035 ‐‐‐‐796,976 796,976
2036 ‐‐‐‐796,976 796,976
2037 ‐‐‐‐796,976 796,976
2038 ‐‐‐‐796,976 796,976
2039 ‐‐‐‐796,976 796,976
2040 ‐‐‐‐796,976 796,976
2041 ‐‐‐‐796,976 796,976
2042 ‐‐‐‐796,976 796,976
2043 ‐‐‐‐796,976 796,976
2044 ‐‐‐‐‐0
Table 7South San FranciscoCapital Improvement Program Project No.Parent ProjectNotes 2021/22 2022/23 2023/24 2024/25 2025/26 5‐Yr TotalSewer Collection System Improvementsss2001 Sanitary Sewer Rehabilitation 499,973 1,575,000 3,500,000 3,500,000 3,500,000 12,574,973 ss1901Coating Program1,050,000 1,200,000 2,250,000 ss1902Pump Station #14 UpgradeTo be determined$4,300,000 Need has yet to be determined; to be funded by Impact Fees if needed TBD/Excludedss2201 Country Club Park Sewer Master Plan 210,000 210,000 ss2202 Oyster Point Pump StationSuccessor Agency No Sewer FundingTBD/Excludedss1502 Pump Station #4 Force Main Under Utah AveTiming unknown$8,000,000 Hoping for federal funds or may need to be debt financed; not yet included in CIP TBD/Excludedss1702 Pump Station #2 Upgrade$2,200,000 to be funded by Capacity Fee & Impact Fee FundsExcludedss1801 Sewer Master Plan Phase 2 272,632 272,632 tbd Forcemain Location and Mapping 750,000 750,000 1,500,000 tbd ERP Financial System (Sewer Est. Share) 500,000 500,000 1,000,000 Subtotal: Sewer Collection System 2,032,605 3,275,000 4,750,000 4,250,000 3,500,000 17,807,605 Water Quality Control Plant Improvementsss1205WQCP Solar Photovoltaic System 1,190,965 1,190,965 ss1301WQCP Wet Weather and Digester Project 4,087,287 4,087,287 San Bruno ShareCash portion paid‐ ss1307Plant‐Wide Industrial Re‐Coating Program 4,890,546 1,750,000 2,000,000 2,000,000 10,640,546 San Bruno Share26.49%(1,295,506) (463,575) (529,800) (529,800) (2,818,681) NBSU Share3.66%(178,994) (64,050) (73,200) (73,200) (389,444) ss1601Sodium Hypochlorite Storage Tank ReplFunded in FY21‐ ss1802Sea Level Rise Study & Planning at WQCP 138,000 3,855,000 2,170,000 2,170,000 8,333,000 San Bruno Share29.79%(41,112) (1,148,449) (646,468) (646,468) (2,482,498) ss1703WQCP Secondary Clarifiers No. 1 & 2 Reconstr 3,000,000 800,000 3,800,000 San Bruno Share26.90%(807,000) (215,200) (1,022,200) ss1705WQCP Switchgear & Cogen Controls UpgradeFunded in FY21‐ tbd DAFT System Rehabilitation 2,500,000 2,500,000 San Bruno Share26.90%(672,500) (672,500) tbd Belt Filter Press Efficiency Improvement 1,100,000 1,100,000 San Bruno Share36.68%(403,500) (403,500) tbd WQCP Unplanned Project Funding1,000,000 1,000,000 Est. Other Agency Share26.90%(269,000) (269,000) WQCP Total Project Costs 15,715,833 6,405,000 5,360,965 4,170,000 1,000,000 32,651,798 San Bruno/NBSU Share (3,398,611) (1,891,274) (1,249,468) (1,249,468) (269,000) (8,057,823) Subtotal: City Share of WQCP Projects 12,317,222 4,513,726 4,111,497 2,920,532 731,000 24,593,975 Total Capital Project Costs 17,748,438 9,680,000 10,110,965 8,420,000 4,500,000 50,459,403 Total City Funding Requirement (Excluding San Bruno/NBSU Share)14,349,827 7,788,726 8,861,497 7,170,532 4,231,000 42,401,580 City 5‐Year Average Annual CIP Funding Requirement8,480,316 Source: CIP Project Funding Worksheets and input from City.
12.34.54.12.90.73.41.91.21.20.32.03.34.84.33.517.79.710.18.44.5$0$5$10$15$20 2021/22 2022/23 2023/24 2024/25 2025/26 Sewer Collection System WQCP: Other Agency Share WQCP: City ShareSouth San Francisco5‐Year Wastewater Capital Improvement Plan ($ millions)Total 5‐Year CIP = $50.5 MillionSan Bruno/NBSU Share = $8.1 MillionSouth San Franciso Share = $42.4 Million
Table 8ARecommended 3% Rate Increases012345678910Esc.2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2029/30Effective Date of Rate Increase Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Sewer Rate Increase % 0%2.0%3.0%3.0%3.0%3.0%3.0%2.0%2.0%2.5%2.5%Projected Annual Single Family Charge $739 $754 $777 $800 $824 $849 $874 $891 $909 $932 $955Interest Earnings Rate 0.5% 0.5% 0.8% 1.0% 1.0%1.0% 1.0% 1.0% 1.0% 1.0% 1.0%Est Revenue Loss Due to Covid (Lagged)‐ $2,000,000 $1,500,000 $1,000,000‐ ‐ ‐ ‐ ‐ ‐ ‐ Beginning Sewer Fund Cash Balancesest $21,442,000 $26,993,000 $26,372,000 $25,126,000 $21,044,000 $19,449,000 $20,656,000 $21,747,000 $22,462,000 $22,762,000 $23,204,000REVENUESEstimated ProjectedSewer Service Charges 24,600,000 23,092,000 24,345,000 25,620,000 27,419,000 28,242,000 29,089,000 29,671,000 30,264,000 31,021,000 31,797,000Colma & NSMCSD Service Charges 1,357,000 1,363,000 1,393,000 1,436,000 1,478,000 1,523,000 1,569,000 1,611,000 1,643,000 1,678,000 1,720,000San Bruno & Other Agency O&M 4.0% 3,825,000 3,774,000 3,925,000 4,082,000 4,245,000 4,415,000 4,592,000 4,776,000 4,967,000 5,166,000 5,373,000San Bruno Share of Debt Service 1,042,000 1,042,000 452,000 1,249,000 1,249,000 1,249,000 797,000 797,000 797,000 797,000 797,000Interest Earnings 110,000 135,000 198,000 251,000 210,000 194,000 207,000 217,000 225,000 228,000 232,000Sewer Impact & Capacity Charges 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000Other Revenues 15,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000______________________________________________________________________________________________________________Total Revenues 31,149,000 29,626,000 30,533,000 32,858,000 34,821,000 35,843,000 36,474,000 37,292,000 38,116,000 39,110,000 40,139,000SRF Reimbursement 9,916,000EXPENSESOperating & MaintenanceSalaries & Benefits 4.0% 9,837,000 8,421,000 8,758,000 9,108,000 9,472,000 9,851,000 10,245,000 10,655,000 11,081,000 11,524,000 11,985,000PERS UAL Contributions incl above 1,640,000 1,789,000 1,882,000 1,980,000 2,038,000 2,092,000 2,148,000 2,205,000 2,264,000 2,324,000Supplies & Services 4.0% 8,023,000 8,619,000 8,964,000 9,323,000 9,696,000 10,084,000 10,487,000 10,906,000 11,342,000 11,796,000 12,268,000Interdepartment Charges 4.0% 1,246,000 1,638,000 1,704,000 1,772,000 1,843,000 1,917,000 1,994,000 2,074,000 2,157,000 2,243,000 2,333,000Addl Wet Weather Cost Recovery 4.0% 0 0 250,000 500,000 750,000 1,000,000 1,040,000 1,082,000 1,125,000 1,170,000 1,217,000O&M for New Equipment/Facilities 4.0% 0250,000 260,000 270,000 281,000 292,000 304,000 316,000 329,000 342,000 356,000______________________________________________________________________________________________________________ Subtotal 19,106,000 20,568,000 21,725,000 22,855,000 24,022,000 25,182,000 26,162,000 27,181,000 28,239,000 29,339,000 30,483,000Debt Service1999 SRF Loan 2,979,000 2,979,000‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐2004 SRF Loan 1,382,000 1,382,000 1,382,000 1,382,000 1,382,000 1,382,000‐ ‐ ‐ ‐ ‐2005 Bonds 451,000 451,000 450,000 447,000 447,000 447,000‐ ‐ ‐ ‐ ‐2008 SRF Loan 433,000 433,000 433,000 433,000 433,000 433,000 433,000 433,000 433,000‐‐2018 SRF Loan‐ ‐ ‐ 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000______________________________________________________________________________________________________________ Subtotal 5,245,000 5,245,000 2,265,000 5,223,000 5,223,000 5,223,000 3,394,000 3,394,000 3,394,000 2,961,000 2,961,000Capital ImprovementsBudgetSewer Collection System Projects 3.0% 2,350,000 2,033,000 3,275,000 4,750,000 4,250,000 3,500,000 4,000,000 4,120,000 4,244,000 4,371,000 4,502,000WQCP Projects 3.0% 1,750,000 15,716,000 6,405,000 5,361,000 4,170,000 1,000,000 2,500,000 2,575,000 2,652,000 2,732,000 2,814,000Less Other Agency Contribs for WQCP 0 (3,399,000) (1,891,000) (1,249,000) (1,249,000) (269,000) (673,000) (693,000) (713,000) (735,000) (757,000)______________________________________________________________________________________________________________ Subtotal 4,100,000 14,350,000 7,789,000 8,862,000 7,171,000 4,231,000 5,827,000 6,002,000 6,183,000 6,368,000 6,559,000Total Expenses28,451,000 40,163,000 31,779,000 36,940,000 36,416,000 34,636,000 35,383,000 36,577,000 37,816,000 38,668,000 40,003,000Revenues Less Expenses2,698,000 (621,000) (1,246,000) (4,082,000) (1,595,000) 1,207,000 1,091,000 715,000 300,000 442,000 136,000Ending Sewer Fund Cash Balances24,140,000 26,372,000 25,126,000 21,044,000 19,449,000 20,656,000 21,747,000 22,462,000 22,762,000 23,204,000 23,340,000SRF Reserve Requirement4,794,000 4,776,000 4,776,000 4,776,000 4,776,000 3,394,000 3,394,000 3,394,000 3,394,000 2,961,000 2,961,000Debt Service Coverage (Min>1.15x)2.30 1.73 3.89 1.92 2.07 2.04 3.04 2.98 2.91 3.30 3.26 South San Francisco Sewer Cash Flow Projections
9.810.110.511.011.511.912.312.813.313.89.310.511.211.912.613.313.814.415.015.65.25.22.35.25.25.23.43.43.43.04.114.47.88.97.24.25.86.06.26.4$0$10$20$30$40$50 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30Annual Expenses ($ Millions) Capital Improvement Projects Debt Service Other Operating Expenses Salaries & Benefits RevenuesSouth San FranciscoSewer Enterprise Projected Revenues & ExpensesRecommended 3% Rate IncreasesElevated Levels of Capital Funding Resultin a Partial Draw Down of Fund Reserves Over the Next 4 YearsHowever, Small Annual Rate Adjustments Support Balanced Budgets in Future Years
Table 9ARecommended 3% Rate IncreasesSouth San FranciscoProjected Sewer RatesCurrentBasis of Calculation Rates 2022/23 2023/24 2024/25 2025/26 2026/27Projected Rate Increases 3%3%3%3%3%RESIDENTIALFixed annual charge per residential dwelling unit.Single Unit Residential Dwelling Unit $753 $776 $799 $823 $848 $873Multi‐Unit Residential Dwelling Unit 676 698 719 741 763 786Trailer Unit Residential Dwelling Unit 676 698 719 741 763 786COMMERCIAL / INSTITUTIONALVolumetric charges per ccf of inflow or effluent, subject to a minimum annual charge.Light Strength Commercial Minimum Charge 753 776 799 823 848 873Hundred Cubic Feet Inflow 9.6761 9.97 10.27 10.58 10.90 11.23or Effluent 10.7512 11.08 11.41 11.76 12.11 12.48Moderate Strength Commercial Minimum Charge 753 776 799 823 848 873Hundred Cubic Feet Inflow 15.1425 15.60 16.07 16.55 17.05 17.56or Effluent 16.8249 17.33 17.86 18.39 18.94 19.51Restaurants Minimum Charge 753 776 799 823 848 873Hundred Cubic Feet Inflow 22.1239 22.79 23.47 24.17 24.90 25.65or Effluent 24.5821 25.32 26.08 26.86 27.67 28.50Institutions Minimum Charge 753 776 799 823 848 873Hundred Cubic Feet Inflow 7.8049 8.04 8.28 8.53 8.79 9.05or Effluent 8.6720 8.93 9.20 9.48 9.77 10.06Septage Haulers Charge per Gallon 0.4126 0.42 0.43 0.44 0.45 0.46INDUSTRIALVolumetric charges per ccf of inflow or effluent plus charges per pound for wastewater strength loadings of COD and TSS, subject to a minimum charge.Industrial Minimum Charge 753 776 799 823 848 873Hundred Cubic Feet Inflow 5.7967 5.97 6.15 6.33 6.52 6.72or Effluent 6.4408 6.63 6.83 7.03 7.24 7.47Chemical Oxygen Demand Pounds 0.6010 0.6190 0.6376 0.6567 0.6764 0.6967Total Suspended Solids Pounds 1.9459 2.0042 2.0643 2.1262 2.1900 2.2557One hundred cubic feet (ccf) equals approximately 748 gallons.Commercial sewer charges are based on annual water consumption from the prior calendar year.City offers a discount pursuant to a Low‐Income Sewer Service Rebate Program based on income eligibility and participation inCalWater's Low Income Rate Assistance (LIRA) Program.Projected Rates Effective per Fiscal Year
Table 8BReduced Rate Scenario with 2% Increases012345678910Esc.2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2029/30Effective Date of Rate Increase Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Jul‐1Sewer Rate Increase % 0%2.0%2.0%2.0%2.0%2.0%2.0%2.5%2.5%2.5%2.5%Projected Annual Single Family Charge $739 $754 $769 $784 $800 $816 $832 $853 $874 $896 $918Interest Earnings Rate 0.5% 0.5% 0.8% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0%Est Revenue Loss Due to Covid (Lagged)‐ $2,000,000 $1,500,000 $1,000,000‐ ‐ ‐ ‐ ‐ ‐ ‐ Beginning Cash Balancesest $21,442,000 $26,993,000 $26,372,000 $24,872,000 $20,256,000 $17,831,000 $17,893,000 $18,602,000 $19,066,000 $19,269,000 $19,623,000REVENUESEstimated ProjectedSewer Service Charges 24,600,000 23,092,00024,094,000 25,106,000 26,628,000 27,161,000 27,704,000 28,397,000 29,107,00029,835,000 30,581,000Colma & NSMCSD Service Charges 1,357,000 1,363,000 1,390,000 1,418,000 1,446,000 1,475,000 1,504,000 1,536,000 1,574,000 1,613,000 1,654,000San Bruno & Other Agency O&M 4.0% 3,825,000 3,774,0003,925,000 4,082,000 4,245,000 4,415,000 4,592,000 4,776,000 4,967,0005,166,000 5,373,000San Bruno Share of Debt Service 1,042,000 1,042,000 452,000 1,249,000 1,249,0001,249,000 797,000 797,000797,000 797,000 797,000Interest Earnings 110,000 135,000 198,000 249,000 203,000 178,000 179,000186,000 191,000 193,000 196,000Sewer Impact & Capacity Charges 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000200,000 200,000 200,000Other Revenues 15,000 20,000 20,000 20,000 20,000 20,000 20,000 20,00020,000 20,000 20,000______________________________________________________________________________________________________________Total Revenues 31,149,000 29,626,00030,279,000 32,324,000 33,991,000 34,698,000 34,996,000 35,912,000 36,856,00037,824,000 38,821,000SRF Reimbursement 9,916,000EXPENSESOperating & MaintenanceSalaries & Benefits 4.0% 9,837,000 8,421,000 8,758,000 9,108,000 9,472,000 9,851,000 10,245,000 10,655,000 11,081,000 11,524,000 11,985,000PERS UAL Contributions incl above 1,640,000 1,789,000 1,882,000 1,980,000 2,038,000 2,092,000 2,148,000 2,205,000 2,264,000 2,324,000Supplies & Services 4.0% 8,023,000 8,619,000 8,964,000 9,323,000 9,696,000 10,084,000 10,487,000 10,906,000 11,342,000 11,796,000 12,268,000Interdepartment Charges 4.0% 1,246,000 1,638,000 1,704,000 1,772,000 1,843,000 1,917,000 1,994,000 2,074,000 2,157,000 2,243,000 2,333,000Addl Wet Weather Cost Recovery 4.0% 0 0 250,000 500,000750,000 1,000,000 1,040,000 1,082,000 1,125,0001,170,000 1,217,000O&M for New Equipment/Facilities 4.0% 0 250,000 260,000270,000 281,000 292,000 304,000316,000 329,000 342,000 356,000______________________________________________________________________________________________________________ Subtotal 19,106,000 20,568,00021,725,000 22,855,000 24,022,000 25,182,000 26,162,000 27,181,000 28,239,00029,339,000 30,483,000Debt Service1999 SRF Loan 2,979,000 2,979,000‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐2004 SRF Loan 1,382,000 1,382,000 1,382,000 1,382,000 1,382,000 1,382,000‐ ‐ ‐ ‐ ‐2005 Bonds 451,000 451,000 450,000 447,000 447,000 447,000‐ ‐ ‐ ‐ ‐2008 SRF Loan 433,000 433,000 433,000 433,000433,000 433,000 433,000 433,000 433,000‐‐2018 SRF Loan‐ ‐ ‐ 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000 2,961,000______________________________________________________________________________________________________________ Subtotal 5,245,000 5,245,0002,265,000 5,223,000 5,223,000 5,223,000 3,394,000 3,394,000 3,394,0002,961,000 2,961,000Capital ImprovementsBudgetSewer Collection System Projects 3.0% 2,350,000 2,033,000 3,275,000 4,750,000 4,250,000 3,500,000 4,000,000 4,120,000 4,244,000 4,371,000 4,502,000WQCP Projects 3.0% 1,750,000 15,716,000 6,405,000 5,361,000 4,170,000 1,000,000 1,000,000 1,030,000 1,061,000 1,093,000 1,126,000Less Other Agency Contribs for WQCP (3,399,000) (1,891,000) (1,249,000) (1,249,000) (269,000) (269,000) (277,000) (285,000) (294,000) (303,000)______________________________________________________________________________________________________________ Subtotal 4,100,000 14,350,0007,789,000 8,862,000 7,171,000 4,231,000 4,731,000 4,873,000 5,020,0005,170,000 5,325,000Total Expenses28,451,000 40,163,000 31,779,000 36,940,000 36,416,000 34,636,000 34,287,000 35,448,000 36,653,000 37,470,000 38,769,000Revenues Less Expenses2,698,000 (621,000) (1,500,000)(4,616,000) (2,425,000) 62,000709,000 464,000 203,000 354,000 52,000Ending Fund Reserves24,140,000 26,372,000 24,872,000 20,256,000 17,831,000 17,893,000 18,602,000 19,066,000 19,269,000 19,623,000 19,675,000SRF Reserve Requirement4,794,000 4,776,000 4,776,000 4,776,000 4,776,000 3,394,000 3,394,000 3,394,000 3,394,000 2,961,000 2,961,000Debt Service Coverage (Min>1.15x)2.30 1.73 3.78 1.81 1.91 1.82 2.60 2.57 2.54 2.87 2.82 South San Francisco Sewer Cash Flow Projections
9.810.110.511.011.511.912.312.813.313.89.310.511.211.912.613.313.814.415.015.65.25.22.35.25.25.23.43.43.43.04.114.47.88.97.24.24.74.95.05.2$0$10$20$30$40$50 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30Annual Expenses ($ Millions) Capital Improvement Projects Debt Service Other Operating Expenses Salaries & Benefits RevenuesSouth San FranciscoSewer Enterprise Projected Revenues & ExpensesReduced Rate ScenarioElevated Levels of Capital Funding Resultin a Partial Draw Down of Fund Reserves Over the Next 4 YearsHowever, Small Annual Rate Adjustments Support Balanced Budgets in Future Yearswith Reduced Capital Funding
Table 9BReduced Rate Scenario with 2% IncreasesSouth San FranciscoProjected Sewer RatesCurrentBasis of Calculation Rates 2022/23 2023/24 2024/25 2025/26 2026/27Projected Rate Increases 2%2%2%2%2%RESIDENTIALFixed annual charge per residential dwelling unit.Single Unit Residential Dwelling Unit $753 $768 $783 $799 $815 $831Multi‐Unit Residential Dwelling Unit 676 691 705 719 734 748Trailer Unit Residential Dwelling Unit 676 691 705 719 734 748COMMERCIAL / INSTITUTIONALVolumetric charges per ccf of inflow or effluent, subject to a minimum annual charge.Light Strength Commercial Minimum Charge 753 768 783 799 815 831Hundred Cubic Feet Inflow 9.6761 9.87 10.07 10.27 10.48 10.69or Effluent 10.7512 10.97 11.19 11.41 11.64 11.88Moderate Strength Commercial Minimum Charge 753 768 783 799 815 831Hundred Cubic Feet Inflow 15.1425 15.45 15.76 16.08 16.40 16.73or Effluent 16.8249 17.17 17.51 17.87 18.22 18.59Restaurants Minimum Charge 753 768 783 799 815 831Hundred Cubic Feet Inflow 22.1239 22.57 23.02 23.48 23.95 24.43or Effluent 24.5821 25.08 25.58 26.09 26.61 27.14Institutions Minimum Charge 753 768 783 799 815 831Hundred Cubic Feet Inflow 7.8049 7.96 8.12 8.28 8.45 8.62or Effluent 8.6720 8.84 9.02 9.20 9.39 9.58Septage Haulers Charge per Gallon 0.4126 0.42 0.43 0.44 0.45 0.46INDUSTRIALVolumetric charges per ccf of inflow or effluent plus charges per pound for wastewater strength loadings of COD and TSS, subject to a minimum charge.Industrial Minimum Charge 753 768 783 799 815 831Hundred Cubic Feet Inflow 5.7967 5.91 6.03 6.15 6.27 6.40or Effluent 6.4408 6.57 6.70 6.83 6.97 7.11Chemical Oxygen Demand Pounds 0.6010 0.6130 0.6253 0.6378 0.6506 0.6636Total Suspended Solids Pounds 1.9459 1.9848 2.0245 2.0650 2.1063 2.1484One hundred cubic feet (ccf) equals approximately 748 gallons.Commercial sewer charges are based on annual water consumption from the prior calendar year.City offers a discount pursuant to a Low‐Income Sewer Service Rebate Program based on income eligibility and participation inCalWater's Low Income Rate Assistance (LIRA) Program.Projected Rates Effective per Fiscal Year
Table 10
South San Francisco
Comparison of Rate Scenarios
Current
Rates 2022/23 2023/24 2024/25 2025/26 2026/27
Recommended 3% Rate Increases
Projected Rate Increases 3%3%3%3%3%
Single Unit Residential $753 $776 $799 $823 $848 $873
Monthly Equivalent 62.75 64.67 66.58 68.58 70.67 72.75
Reduced Rate Scenario with 2% Rate Increases
Projected Rate Increases 2%2%2%2%2%
Single Unit Residential $753 $768 $783 $799 $815 $831
Monthly Equivalent 62.75 64.00 65.25 66.58 67.92 69.25
Projected Rates Effective per Fiscal Year
Five-YearSewer Rate Plan 1
2• Sewer Fund Overview• Current Sewer Rate Plan• Ten Year Sewer Rate History•Infrastructure Investments• Five-Year Rate Plan ScenariosPresentation Overview
FY 2017-18FY 2018-19FY 2019-20FY 2020-21FY 2021-22Single Unit Residential$664.00 per EDU(13% Increase)$724.00 per EDU(9% Increase)$739.00 per EDU(2% Increase)$739.00 per EDU(0% Increase)$754.00 per EDU(2% Increase)Multi-Unit/Trailer Residential $596.00 per EDU(13% Increase)$650.00 per EDU(9% Increase)$663.00 per EDU(2% Increase)$663.00 per EDU(0% Increase)$676.00 per EDU(2% Increase)Commercial*(13% Increase)(9% Increase)(2% Increase)(0% Increase)(2% Increase)3*Minimum commercial rate is tied to Single Unit Residential
4The City’s residential sewer rates will remain among the lowest in San Mateo County
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