Sewer Rate Increases

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Dear Customer:

This notice describes increases to the City's wastewater (sewer) rates over the next five (5) years. This notice also explains the reasons for the rate increases and the uses of the additional revenues that will be generated by the rate increases.

How are the rates used and how does it benefit customers?  

The City provides wastewater services to approximately 8,000 residential and 300 commercial customers. The Sanitary Sewer System has two components: collection and treatment/disposal. Wastewater is collected through a network of 55 miles of main pipe, 22 miles of lateral pipes to homes and businesses, and 3 pump stations, which flows to a treatment plant for treatment and disposal of the wastewater.

The City's Wastewater Enterprise Fund is entirely self-supporting and is funded primarily  by revenues from rates and charges paid by customers. The funds are used to  operate  and maintain the quality and reliable sanitary collection system and treatment plant  the  City  has come to rely upon. No General Fund revenues (e.g., property, sales or hotel taxes) are used to support wastewater operations . There are no ongoing federal or state  grant  funds  available  to fund operations or improvement to the system. Therefore, wastewater rates and charges must be established. at a level to cover operations, maintenance, improvements and upgrades to the City's  collection  system  and treatment facilities.

Why is the City increasing its wastewater rates? 

The City last updated its wastewater rates nearly five years ago on July 1, 2010 and has not had any increases since that date. The City has remained prudent in its expenditure of wastewater funds to provide a safe and reliable system while keeping costs down  and enhancing its wastewater treatment facilities. Yet while the City has not had to raise its fees to cover operational and capital costs, it is projected that existing revenues will not be sufficient to cover those costs in the future . Many of the pipes and pump stations are aging and are in need of replacement. These increasing needs require additional funding to fully support the system. Accordingly, the base service charges and quantity charges will need to be increased starting on August 1, 2015 in order to preserve the financial health of  the wastewater system's operations and current bond obligations.

In  2009,  BayKeeper,  a non-profit  organization, filed complaints  against  several wastewater treatment system providers along the San Francisco Bay in US District Court alleging that these treatment systems were violating the Clean Water Act by discharging pollutants from the various agencies' wastewater collection and treatment systems.  Each agency entered into separate agreement with BayKeeper regarding their treatment systems. 

The City entered into a Settlement Agreement  with  BayKeeper  in 2010, which  requires  the City to invest a total of $34 million over the next five to ten years in capital improvements to  its collection system and treatment facilities. The City will  need to  borrow $27 million through  loans or bonds payable over a 20-year period in order to fund those capital improvement costs. The capital improvements will reduce the system's sanitary sewer overflows 1 and provide greater reliability of the sewer system. These improvements will include  pipe  replacements  in  many areas of the City which currently have aging pipes. It will also include lateral  replacements  to many homes in the City that will improve their direct connection to the City's system, thus reducing overflow and blockages.  In short, these projects will improve the safety and reliability of the City's wastewater collection system. 

In response to the BayKeeper Settlement Agreement and to provide capital improvements for reliability to the system, the City is proposing to implement a uniform monthly surcharge for all wastewater accounts beginning on August 1, 2015. The surcharge will  remain  in  effect  until which time the loans and/or bonds associated with such improvements are paid in full, which is expected to be in  2036.

How will these increases impact customers?

 The rate adjustments proposed in this Notice affect the monthly service charge and quantity charges. In addition, in order to comply with the BayKeeper Settlement Agreement, a separate monthly surcharge known as the "sanitary sewer  charges," will be introduced in all customer  bills.

Monthly service charges are proposed to increase by  approximately  7%  for  each  customer class. Residential customers' monthly charges will increase by $2.90, from $41.70 to $44.60 on August 1, 2015, and will further increase each year by 7% to a maximum of $58.90  by July 1, 2019. Quantity charges will increase by approximately 6% for each customer class. Residential customers' quantity charges will increase from $4.91 per unit of water (one unit  equals 748 gallons) to $5.20  per unit on August  1, 2015,  and will  increase 6% each year  to a maximum of $6.62 per unit by July 1, 2019. This rate is applied only to the amount of water residential customers use on average during winter months (November to February or December to March, depending  upon the customers'  billing period).

The new sanitary sewer overflow charges monthly surcharge will be $10.50  starting August 1, 2015, and will increase to $23.90 on July 1, 2016. It will remain in effect until 2036.

Based upon a typical residential customers' winter  water  usage of 6  units of water  per  month, the typical residential monthly sewer bill will increase from approximately $71 to $86 per month starting August 1, 2015, and rise each year to a maximum of $123 per month by July 1, 2019.

New Rates FY 2015-2016

The sewer billing rates are increasing as of July 1, 2016. This increase in July represents the second of the five approved sewer rate increases from August 1, 2015 to July 1, 2019.  Effective July 1, 2016, the increases will be as follows: 



(Effective 8/1/2015)


(Effective 7/1/2016)

 Quantity Charges ($ per ccf)    
      Residential, Universal Life Support   $5.20  $5.51
      Retail, Commercial & Other Categories    
           Restaurants  $7.73  $8.19
           Hotels/Motels, Food Processors  $9.69  $10.27
           Supermarkets, Schools w/ Food Service  $9.44  $10.01
           Auto-Service Stations  $6.53  $6.92
           Schools w/ No Food Service  $4.63  $4.91
           Commercial  $4.87  $5.16
           Groundwater  $5.85  $6.20
 Pretreatment 1 Charges ($ per ccf)    
     Retail, Commercial and Other Categories As Listed Above  $1.87  $1.98
 Pretreatment 2 Charges ($ per ccf)    
     Retail, Commercial and Other Categories As Listed Above   $1.39  $1.47
 Service Charges ($ per month)    
     Residential   $44.60


     Universal Life Support   $33.50  $35.80
     Retail, Commercial and Other Categories As Listed Above   $44.60  $47.70
 Sanitary Sewer Overflow Charges ($ per month)    
     All Customer Classes  $10.50  $23.90

For more information, please contact the Water Utility Billing information at (650) 259-2350.