sr-021081-5qSanta Monica, California January 9, 1980
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To: Mayor and City Council
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From: City Staff
Subject: RECOMMENDATIONS TO ESTABLISH A WATER CAPITAL
IMPROVEMENT FEE FE6 1 0 X091
Introduction
This report presents recommendations to establish a Capital Improvement fee for
water in accordance with previous Council actions.
Background
In May, August, October and November, the City Council considered: recommendations for
water rate increase. In November the City Council adopted a resolution for an
"Interim Water Rate Proposal" submitted by Councilmember Scott. This interim increase
which raises the basic water rate from $0.45 to $0.53 per 100 cu. ft. will generate
approximately $3.3 million, approximately the amount needed for operations and
maintenance but no capital improvements. An additional increase in water rates to fund
capital improvements was anticipated when this action by the Council was taken.
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In accordance with Council direction, the staff has prepared a proposal to generate
the approximately $2.0 million annually for capital improvements. The staff including
the Data Processing Manager first attempted to determine if the County Assessor's roles
could be used to distribute capital costs to all properties in the City. It was found
that approximately 11,000 of the County files out of the 16,000 City files for water
customers do not match. According to the Data Processing Division minimal manual
techniques can be used to substantially reduce the lack of match but substantial (many
months) Wo r,~ would result. The staff has not pursued this direction and instead
chose a unit rate for residential property and the suggested floor area for commercial
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and industrial property only. The unit charges for the types of property are based on
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To: Mayor and City Council -2= Janudry 9, 1981
actual capital expenditures for the past 7 years and the proposed capital expenditures
for the next 5 years. These capital expenditures are as follows:
General* CommercialJIndustrial Residential
1973-74 181,990 47,700 35,000
1974-75 68,352 14,760 124,380
1975-76 106,133 151,920 54,562
1976-77 23,143 234,750 149,100
1977-78 260,430 66,000 296,200
1978-79 119,300 1,526,304 146,250
1979-80 552,593 539,792 422,000
1980-81 1,162,350 46,400 100,800
1981-82 1,610,800 255,960 711,220
1982-83 450,300 78,200 895,375
1983-84 437,500 66,300 1,006,700
1984-85 2,758,350 61,600 920,250
1985-86 2",089,200 273,000 655,200
TOTAL $9,820,441 $3,302,686 $5,517,037
*Those of a general nature include improvements to wells, pumps, reservoirs,
buildings, and purchase of vehicles and equipment.
If the costs of the capital improvements of a general nature are distributed to the
two classes of customers - commercial/industrial and residential - in proportion to the
total amounts of capital funds which have been spent and which are proposed to be
spent as shown above the proportions which would be assigned to the two classes of
To: Mayor: and City Council -3- January 9, 1981
customers - commercial/industrial and residential - are 37.5% to commercial/
industrial and 62.5% to residential. To generate $2.0 million annually for capital
improvements it follows that $750,000 should be distributed to the 16,000,000 sq. ft.
of commercial/industrial property and $1,250,000 should be distributed to the 46,000
residential units in the City.
The unit costs for the various properties could be distributed as follows:
Single Family Units 8,500 @ $3.50/mo.l X 12 = 359,100
.Multi-Family Units 37,100 @ $2.00/mo.2 X 12 = 890,400
1,249,500
Commercial/Industrial
buildings 16,000,000 sq.ft. @ .046875 = 750,000
Total 1,999,500
The total bi-monthly water-bill using these proposed charges fora number of types
of customers is shown below (does not include fire service charges, if any):
EXISTING BILL)
FOR 2 MONTHS
PROPOSED BILL
FOR 2 MONTHS
Single Family Residence
using 20 billing units - $T3.00 $20.00
10 Unit Apartment/Condominium
using 100 units (1" meter) - $62.40 $102.40
1. Based on average home size of 1,800 ft.2 = .023/ft.2
2. Based on average apartment size of 1,200 - .02/ft.2
3. As adopted November, 1980
To: Mayor end City Council
EXISTIPJG BILL1
FOR 2 MONTNS
Santa Monica Shores
-4- January 9, 1981
2700-2800 Neilson Way
PROPOSED BILL
FOR 2 MONTHS
4" Dom. 2231 C.ft.3 $1,882.43 $4,577.61
Service Charge 54.90 266 units X 4.00 1,064.00
6" Dom. 3340 1,503.00
Service Charge 124.70 $5,641.61 Total
6" Dom. 2996 1,587.38
Service Charge 124.70
Total $4,577.61 Total
Evening Outlook
2" Dom. 3938 C.ft.3 $2,087.14 $2,101.54
Service Charge. 14.40 50,000 ft.2 390.63
Total $2,101.54 $2,492.17 Total
USA Petroleum
2" Dom. 421 C. ft.3
Service Charge
Total
$223.13
14.40 45,000 ft.2
$237.53
$ 237.53
351.56
589.09 Total
Champagne Towers - 1221 Ocean Ave.
2" Dom. 3,339 C. ft.3 $1,769.67
Service Charge 14.40
Total $1,784.07
119 units X $4.00
$1,784.07
476.00
$2,260.07 Total
Sea Castle - 1725 Promenade
4" Dom. 1,528 C. ft.3 $ 809.84 $864.74
Service Charge 54.90 178 units X $4.00 712.00
Total $ 864.74 $1,576.74 Total
Ocean Towers - 201 Ocean Avenue
4" Dom. 3,749 C. ft.3 $1,986.91 $2,041.81
Service Charge 54.90 305 units X $4.00 1,220.00
$2,041.81 $3,261.81 Total
1. As adopted November, 1980
T0: Mayor and City Council -5- January 22, 1981
Recommendation
It is recommended the City Council adopt the attached resolution setting
a Capital Improvement Service Charge.
Prepared by: Stanley E. Scholl
Ed Lash