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Home My WebLink AboutMINUTES - 04231996 - D2 D. �-A TO: BOARD OF SUPERVISORS £-SE:L _ Contra FROM: SUPERVISOR MARK DeSAULNIER .� Costa County DATE: Aril 17 1996 c�. = .•�A SUBJECT: SUPPORT FOR AB 2203 (RAINEY) RE EAST BAY MUNICIPAL UTILITY DISTRICT RATES SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: ADOPT a position in SUPPORT of AB 2203 by Assemblyman Richard Rainey, which would limit the ability of the East Bay Municipal Utility District (EBMUD) to increase rates in the Contra Costa County portion of the District. BACKGROUND: We have recently had a good many complaints and controversy from many residents of Contra Costa County who are a part of the EBMUD because EBMUD has instituted highly inflated rates for large water users, apparently in an effort to discourage usage of large quantities of water. However, their pricing policies and practices do not take into account the fact that the weather in the Central Contra Costa County portion of the District requires the use of more water for landscaping purposes than does the portion of the District which is west of the Caldecott Tunnel. Assemblyman Rainey has introduced AB 2203 in an effort to limit the ability of EBMUD to charge rates to some customers which are several times the rate charged to other customers. As introduced, AB 2203 would have done the following: 1. Permit EBMUD to impose rates on a tiered or differential basis, subject to the two following restrictions. 2. Prohibit a rate from being less than the cost of service. CONTINUED ON ATTACHMENT: YES SIGNATURE: RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE APPROVE f (OTHER SIGNATURE(S): MARK IFR ACTION OF BOARD ON April 23,1996 APPROVED AS RECOMMENDED OTHER The Board of Supervisors has DETERMINED not to take a position on the proposed legislation AB 2203 (Rainey) until after the scheduled joint meeting with the East Bay Municipal Utilities District (EBMUD) Board on Wednesday, April 24, 1996, 6:30 P.M., at Park Place, 1395 Civic Drive, Walnut Creek; IT IS BY THE BOARD ORDERED that the Director, Growth Management and Economic Development Agency (GMEDA) , is DIRECTED to further explore the competing arguments about whether the water rates on the east side of the Caldecott Tunnel are more than the cost of service and to get input from all cities that are affected by EBMUD's watter rates; and IT IS FURTHER ORDERED that the Director, GMEDA, is DIRECTED to bring this issue back for Board consideration at the May 7, 1996, Baord of Supervisors meeting. VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN AYES: 1,5, and 2 NOES: 3 and 4 AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: None ABSTAIN: None OF SUPERVISORS ON THE DATE SHOWN. ATTESTED April 23, 1996 Contact: PHIL BATCHELOR,CLERK OF THE BOARD OF cc: See Page 2 S R S AND COUNTY AD I TRATO BY a2-A 3. Prohibit the maximum rate charged from exceeding the minimum rate charged by more than 50%. AB 2203 was amended March 28, 1996. As amended, AB 2203 now does the following: 1. Permits EBMUD to impose rates on a tiered or differential basis, subject to the following restrictions: 2. There must be three tiers. Except as provided below, no rate for single-family residential rate payers may be less than 95% of the average cost of service for all customers in that class nor greater than 105% of the average cost of service. 3. The district may set a rate on waterflow consumption that is less than 95% of the average cost of service for low income customers. 4. The district may set a rate on waterflow consumption that is less than 95% of the average cost of service for recycled or reclaimed water. 5. The bill also defines "cost of service" and states that the bill is not to be interpreted so as to impair the district's ability to implement water conservation, reclamation or recycling projects. Enactment of AB 2203 would be of substantial benefit to those residents of Contra Costa County who live in that portion of EBMUD which is east of the Caldecott Tunnel and who are required to use large amounts of water to preserve their landscaping. It is, therefore, recommended that the Board join me in indicating to Assemblyman Rainey our support for his AB 2203. AB 2203 is scheduled to be heard in the Assembly Local Government Committee (Chaired by Assemblyman Rainey) on Wednesday, April 24, 1996. cc: County Administrator Director, GMEDA The Honorable Richard K. Rainey Assemblyman, 15th District Room 4149 State Capitol Sacramento, CA 95814 Les Spahnn; Heim, Noack, Kelly & Spahnn 1121 L Street, Suite 100 Sacramento, CA 95814 -2- AB 2203 — 2 - 1 2 - 1 differential basis. 14ewe itt fte insta„ee sha4 the 2 Elistriet ekar-ge a fatte #fit Is tress than the east of 3 tier- sheA the a rade eharged emeeed the 4 minimufn rate b�,mere theat 50 percent.However, in any 5 tiered or differential rate plan, there shall be no fewer 6 than three tiers. In no instance, except as provided in 7 paragraphs (1) and (2), shall the district set a rate on 8 waterflQw consumption or any otherfee relating to water 9 consumption, involving single family residential rate 10 payers that is less than 95 percent of the average cost of 11 service, for all customers in that class, orgreater than 105 12 percent of the.average cost of service. 13 (1) The district may set a rate on waterflow 14 consumption that is less than 95 percent of the average 15 cost ofservice for low-income customers. 16 (2) The district may set a rate on waterflow 17 consumption that is less than 95 percent of the average 18 cost ofservice for recycled or reclaimed water, pursuant 19 to Chapter 7 (commencing with Section 13500) and 20 Chapter 7.5 (commencing with Section 13575) of , 21 Division 7 of the Water Code. 22 (b) For purposes. of this section, "cost of service" 23 means costs directly related to the utility district's 24 operation, support, maintenance, debt service, water 25 reclamation and conservation projects, and low-income 26 rate subsidy programs, as determined by the standard 27 operating procedures of the district. 28 (c) This section shall not be interpreted so as to impair 29 the district's ability to implement water conservation, 30 reclamation, or recycling projects. 31 ' SEC. 2.' Due to the unique circumstances concerning 32 the equalization of reasonable rates for water service.in 33 the East Bay Municipal Utility District, the Legislature 34 'finds and declares that a general statute cannot be made 35 applicable within the meaning of Section 16 of Article IV 36 of the California Constitution. O 98 D AMENDED IN ASSEMBLY MARCH 28, 1996 CALIFORNIA LEGISLATURE-1995-96 REGULAR SESSION ASSEMBLY BILL No. 2203 Introduced by Assembly Member Rainey February 8, 1996 An act to add Section 12809.1 to the Public Utilities Code, relating to municipal utility districts. LEGISLATIVE COUNSEL'S DIGEST AB 2203, as amended, Rainey. East Bay Municipal Utility District. Existing law provides that the rates and charges for commodities or service shall be fixed by the board of directors of a municipal utility district. This bill would provide that, notwithstanding any other provision of law, the. Board of Directors of the East Bay Municipal Utility District may impose rates on a tiered or _ ? differential basis within specified parameters. Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no. The people of the State of California do enact as follows. 1 SECTION 1. Section 12809.1 is added to the Public 2 Utilities Code, to read: 3 12809.1. (a) Notwithstanding any other provision of 4 law, the Board of Directors of the East Bay Municipal 5 Utility District may impose rates on a tiered or 98 TO: BOARD OF SUPERVISORS _ Contra � ra FROM: WATER COMMITTEE % n�.} Supervisor Gayle Bishop, Chair C�I..JJ.sta Supervisor Tom Torlakson County DATE: April 23, 1996 SUBJECT: Report on AB 2203; East Bay Municipal Utility District, sponsored by Assemblyman Rainey SPECIFIC REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS ADOPT a Support-in-principal position on AB 2203; East Bay Municipal Utility District (EBMUD), sponsored by Assemblyman Rainey, and AUTHORIZE Chair to sign a letter expressing the previously established County position on EBMUD rate issues. RFA ON FOR RECOMMENDATION Assemblyman Rainey, at the request of citizen groups located in southern and central Contra Costa County, has sponsored legislation which attempts to provide parameters for use by the EBMUD Board of Directors in establishment of rates for customers within the District. The Board's Water Committee understands that the text of this legislation may change substantially, so has recommended a support-in-principle position, with a letter to Assemblyman Rainey expressing County concerns with the rate structure as it stands. Significant concern over rates has emerged over the past year with the tiered or inclined block rate system which has historically discriminated against water users east of the hills through a rate structure which has as its base a rate less than the actual cost of water, and steeply tiered rates which essentially penalized higher volume water users. The EBMUD Board has recently reduced the costly fourth tier, but has kept the subsidized first tier in place (the 'subsidy' occurs when higher volume water users pay much higher costs as they use more water, essentially allowing users west of the hills who remain in the first tier because of lower volume water use to enjoy rates less than the cost to deliver this water). The concern over rates by Contra Costans east of the hills has been significant, and has included concern relative to the lack of representation on EBMUD's Board of Directors (there are only 1.5 Director(s) out of 7, representing areas east of the hills). In addition, at the height of the rate debate, citizen groups considered and are still pursuing ways to secede from the District. CONTINUED ON ATTACHMENT: _YES SIGNATURE: — RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE APPROVE OTHER SIGNATURE(S): Supervisor Gayle Bishop, Chair Supervisor Tom Torlakson CTION OF BOARD ON APPROVED AS RECOMMENDED OTHER VOTE OF SUPERVISOR UNANIMOUS (ABSENT I BY CERTIFY THAT THIS IS A TRUE AND AYES: NOES: ORRECT COPY OF AN ACTION TAKEN AND ABSENT: ABSTAI ENTERED ON THE MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE SHOWN. Contact: Roberta Goulart (510) 335-1226 ATTESTED cc: Community Development Dep ment PHIL BATCHELOR, CLERK OF THE Growth Management & nomic Development BOARD OF SUPERVISORS AND Agency COUNTY ADMINISTRATOR County Admini ator's Office BY: , DEPUTY RG:rw RRG4:4- C2.6bd CA AB 2203 04/16/96 Page 1 California. 1995- 96 Regular Session 1995 CA AB 2203 Amended Rainey AMENDED IN ASSEMBLY MARCH 28 , 1996 ASSEMBLY BILL No. 2203 ------------------------------------------------------------------------------- ------------------------------------------------------------------------------- INTRODUCED BY Assembly Member Rainey FEBRUARY 8 , 1996 ------------------------------------------------------------------------------- ------------------------------------------------------------------------------- An act to add Section 12809 . 1 to the Public Utilities Code, relating to municipal utility districts . LEGISLATIVE COUNSEL ' S DIGEST AB 2203 , as amended, Rainey. East Bay Municipal Utility District . Existing law provides that the rates and charges for commodities or service shall be fixed by the board of directors of a municipal utility district . This bill would provide that, notwithstanding any other provision of law, the Board of Directors of the East Bay Municipal Utility District may impose rates on a tiered or differential basis within specified parameters . Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS : SECTION 1 . Section 12809 . 1 is added to the Public Utilities Code, to read: 12809 . 1 . [A> (a) <A] Notwithstanding any other provision of law, the Board of Directors of the East Bay Municipal Utility District may impose rates on a tiered or differential basis . [D> However, in no instance shall the district charge a rate that is less than the cost of service, nor shall the maximum rate charged exceed the minimum rate by more than 50 percent. <D] [A> However, in any tiered or differential rate plan, there shall be no fewer than three tiers . In no instance, except as provided in paragraphs (1) and (2) , shall the district set a rate on waterflow consumption or any other fee relating to water consumption, involving single-family residential rate payers that is less than 95 percent of the average cost of service, for all customers in that class, or greater than 105 percent of the average cost of service. <A] CA AB 2203 04/16/96 Page 2 [A> (1) The district may set a rate on waterflow consumption that is less than 95 percent of the average cost of service for low-income customers . <A] [A> (2) The district may set a rate on waterflow consumption that is less than 95 percent of the average cost of service for recycled or reclaimed water, pursuant to Chapter 7 (commencing with Section 13500) and Chapter 7 . 5 (commencing with Section 13575) of Division 7 of the Water Code. <A] [A> (b) For purposes of this section, "cost of service" means costs directly related to the utility. district ' s operation, support, maintenance, debt service, water reclamation and conservation projects , and low- income rate subsidy programs , as determined by the standard operating procedures of the district. <A] [A> (c) This section shall not be interpreted so as to impair the district ' s ability to implement water conservation, reclamation, or recycling projects . <A] SEC. 2 . Due to the unique circumstances concerning the equalization of reasonable rates for water service in the East Bay Municipal Utility District, the Legislature finds and declares that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution. END OF REPORT 04/16/96 Page 1 County of Contra Costa 5054 ,CA AB 2203 AUTHOR: Rainey TITLE: East Bay Municipal Utility District : INTRODUCED: 02/08/96 LAST AMEND: 03/28/96 COMMITTEE: Assembly Local Government Committee HEARING: 04/24/96 1 : 30 pm SUMMARY: Provide that, notwithstanding any other provision of law, the Board of Directors of the East Bay Municipal Utility District may impose rates on a tiered or differential basis within specified parameters . STATUS: 03/28/96 From ASSEMBLY Committee on LOCAL GOVERNMENT with author ' s amendments . Read second time and amended. Re-referred to Committee. CA AB 2346 AUTHOR: Rainey TITLE: Local government organization INTRODUCED: 02/16/96 LAST AMEND: 03/28/96 COMMITTEE: Assembly Local Government Committee HEARING: 04/24/96 1 : 30 pm SUMMARY: Provides that in any matter involving the proposed detachment of Contra Costa County from the East Bay Municipality Utility District, the Contra Costa County Local Agency Formation Commission shall have exclusive commission jurisdiction for the proposal . STATUS: 03/28/96 To ASSEMBLY Committee on LOCAL GOVERNMENT. 03/28/96 From ASSEMBLY Committee on LOCAL GOVERNMENT with author ' s amendments . Read second time and amended. Re-referred to Committee. END OF REPORT The Board of SupervisorsContra Phil Batchelor Clerk of the Board Costa and County Administration Building county administrator 651 Pine Street, Room 106 (510)646-2371 Martinez, California 94553-1293 County , Jim Rogers,1st District e 1 Jeff Smith,2nd District Gayle Bishop,3rd District / Mark DeSsuinler,4th District Tom Torlakson,stn District December 8, 1995 Mr. John Gioia, President W�.t' Board of Directors East Bay Municipal Utility District 365 Eleventh Street Oakland, CA 94607-4240 SUBJECT: EBMUD WATER RATE AND SEISMIC IMPROVEMENT INCREASES Dear Mr. Gioia: As you are aware, the Contra Costa County Board of Supervisors is extremely concerned about EBMUD Board actions which have discriminated against water users east of the hills . We understand that recently approved rates are to be reconsidered, and we hope to see a revised rate, structure which will finally consider the needs of all water users, rather that a system which relies on high volume users to subsidize other residential water users west of the hills . The Board of Supervisors does not support either of the two revised rate scenarios which reduce the costly fourth tier, or eliminate it. However a plan which raises the first tier to the actual cost of providing water (or higher) combined with a flattened tier structure and a revised or eliminated fourth tier would have the desired effect of a more equitable scenario for all users. It is also important to note that a subsidized first tier rate absolutely should not be considered a lifeline rate, as indicated in EBMUD literature. Lifeline rates should only be extended to specific applicants which can prove inability to handle costs associated with needed water use, rather than the existing automatic subsidy of all low water use ratepayers . The issue of subsidized rates is one that cannot be explained away by creative statistics . Finally, the inclined block rate structure is effective in drought situations, but is of questionable use in non-drought periods. EBMUD's conservation excuse for this rate scenario is wearing thin, as ratepayers have already demonstrated conservation in the worst of water years, and continue to conserve. Indeed, more actual water conservation activities may be occurring in higher water use areas than in areas which traditionally use less water.- -With such extreme rate increases adopted in a wet year, what are we to expect in the next drought sequence? f The bottom line is that rates east of the hills are punitive, particularly when all rate costs are included. Elevation charges, higher meter charges, and seismic rates based on volume all contribute to the outrageous water bill ,your ratepayers east of the hill are paying. To add insult to injury, EBMUD is basing seismic improvement surcharges on parcel size, resulting in a 20% difference in charges . First, the convenient excuse of promoting conservation does not ring true. There is absolutely no correlation between the cost of seismic improvements to EBMUD infrastructure, and parcel size. It is just another example of ratepayers east of the hills subsidizing those on the west. Given the extreme amount of ratepayer rage over these issues, and the fact that the EBMUD Board is reviewing past actions, it is the Board of Supervisors opinion that now is the time to thoroughly review all issues related to rates, and provide an overall plan for the district which is fair and equitable to all ratepayers . This is not an issue which can be solved simply by rolling back fourth tier rates . Thank you for your consideration of our concerns . If you have questions, please contact Roberta Goulart of our staff at (510) 646- 2071 . Sincerely, Gayle Bishop Chair Board of Supervisors PRequest to eak Form ( THREE (3) Mi N UTE LIMIT) O/ Complete this form and place It in the box near the speakers' rostrum before addressing the Board Nam C-I AADV-� L_ horse• 2� - o }S 1 am speaking for myself_or orphization: 3n�� imine of a p dzadoN CHEM ONS Y-� i wish to weak on Agenda item #= Dat My comments will be: general _for,_�ainst 1 wish to speak on the subject of . 1 do not wish to speak but leave these comments for the Board to cou" . DATE: / L REQUEST TO SPEAK FORINT (THREE (3) MINUTE LIMIT + " Complete this form and place it in the box near the speakers' rostrum before addressing the Board. NAME: �� C��CPHONE: ADDRESS: � .� F1�.? Ct.! Fr CITY: I am speaking formyself OR organization: 2?A c-osr� (NAME OF ORGANMNTION) Check one: I wish to speak on Agenda Item # 2 . My comments will be: general for against I wish to speak on the subject of I do not wish to speak but leave these comments for the Board to consider. Request to Speak Form . ( THREE (3) MINUTE LIMIT) Complete this form and place it in the box near the speakers' rcalt um before addressing the Board. Phone; 1 am speaking for myself_or A /rank of o�an�sat�oN DUCK ONE: 1 wish to speak on /Agenda Item #J1.2,.1 Oat My comments will be: gerreial �for,�,�gainst 1 wish to speak on the subject of t X�j f�6 P-- _ i do not wish to speak but leave thme comments for the Board to oansid-- -