HomeMy WebLinkAboutAgenda Packet 10/14/2014 Utility Advisory Committee
Jack Pittis Conference Room
Port Angeles, WA 98362
October 14, 2014 @ 3:00 p.m.
AGENDA
L Call To Order
II. Roll Call
III. Approval Of Minutes For August 12, 2014
IV. Late Items
V. Discussion Items:
A. Medic I Utility Rate Ordinance Amendment
B. Industrial Transmission Electric Cost-of-Service and Rate Ordinance Amendment
C. Blue Mountain Transfer Station Surcharge Fee Ordinance Amendment
VI. Information Only Items:
A. Bonneville Power Administration Power Update for FY2016-2017 (verbal report only)
B. Morse Creek (verbal report only)
VII. Next Meeting Date: November 11, 2014
VIII. Adjournment
N:AUAC\MEETINGS\UAC2014\UAC101414\101414 Agenda.docx
Utility Advisory Committee
Jack Pittis Conference Rooms
Port Angeles,WA 98362
August 12,2014
3:00 p.m.
L Call To Order
Chairman Lynn Bedford called the meeting to order at 3:00 p.m.
II. Roll Call
UAC Assigned
Councilmembers Present: Sissi Bruch, Dan Gase, Lee Whetham
Other Councilmembers
Present: Patrick Downie(3:01)
Other Councilmembers
Absent: Cherie Kidd,Dan Di Guilio,Brad Collins
Utility Advisory
Committee Members
Present: Lynn Bedford,Paul Elliott
Utility Advisory
Committee Members
Absent: Betsy Wharton,John LeClere
Staff Present: Craig Fulton,Phil Lusk, Sondya Wray, Gregg King,Bill Bloor,Dan
McKeen,Nathan West(4:06)
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Others Present: 5 Citizens
III. Approval Of Minutes
Chairwoman Lynn Bedford asked if there were any corrections to the minutes of July 8, 2014. Lee Whetham
moved to approve the minutes. Dan Gase seconded the motion, which carried unanimously.
IV. Late Items:
A. Move UAC Date to September 11, 2014 at the Jack Pittis Conference Room at 3PM
B. Tour Date of the Morse Creek Hydro Electric Projects:September 19`x'at 8:30AM
V. Discussion Items:
A. Electric Utility 2014 Resource Plan
Phil Lusk,Deputy Director of Power and Telecommunications Systems, discussed a PowerPoint Presentation
on the Electric Utility 2014 Resource Plan. The electric utilities 2012 Resource Plan must be updated and
submitted to the Washington State Department of Commerce by September 2, 2014. The Resource Plan is
used to assure the future resources are adequate to meet our projected loads.There was a lengthy discussion.
Dan Gase moved to recommend City Council to [pass a resolution to approve the Electric Utility 2014
Resource Plan.Lee Whetham seconded the motion,which carried unanimously.
A Utility Cost of Service and Retail Rate Adjustments
Phil Lusk,Deputy Director of Power and Telecommunications Systems reviewed a PowerPoint presentation
on the comprehensive cost-of-service and retail rates studies.The City's Electric,Water,and Wastewater
utilities were presented. Rate class cost of services adjustments must be considered before the new retail rates
can be finalized in an ordinance. There was a lengthy discussion.
Lee Whetham moved to recommend to City Council regarding the policy related cost-of-service
adjustments that will permit the 2015 rate ordinance amendments for the Electric,Water, and
Wastewater utilities to be finalized,choosing option two. Sissi Bruch seconded the motion,which
carried unanimously.
VI Information Only Item
VII. Next Meeting Dates: September 11,2014
VIII. Adjournment: 4:51 p.m.
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Dan DiG ilio, Mayor Sondya Wray,Administrative Speci st I
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Utility Advisory Committee Memo (REVISED)
Date: October 14, 2014
To: Utility Advisory Committee
From: Ken Dubuc, Fire Chief
Subject: Proposed Medic 1 Rate Adjustments
Summary: Staff recently completed a comprehensive Cost of Service Study for the City's
Medic 1 (ambulance) utility. Based upon the results of the study, staff is proposing adjustments
to Medic 1 fees, which equate to a $0.33 monthly residential rate adjustment and a $0.53
monthly commercial/business rate adjustment for 2015.
Recommendation: Forward a favorable recommendation to the City Council to approve the
proposed Medic 1 Utility rate adjustments effective January 1, 2015,
Background/Analysis: The City of Port Angeles' Medic I program is structured as a utility —
supported by transport charges, a monthly utility charge, and a General Fund contribution. The
Medic 1 Utility rates are based upon a Cost of Service Study, which:
• Assigns costs to customer classes based on a rate that reflects the cost incurred for the
availability and delivery of services.
• Ensures that rates charged are equitable across the customer classes.
• Ensures that rates are based on the cost of actually providing the services.
The Fire Department, along with the Finance Department, recently completed a comprehensive
Medic 1 Cost of Service Study for 2014. Based on this study, the annual residential customer
rate would increase from $65.14 to $69.05 in 2015, or $0.33 per month and the
commercial/business annual rate would increase from $68.54 to $74.92, or $0.53 per month.
The high demand user classifications, such as nursing homes and assisted living facilities, will
see both an increase and a decrease, depending upon their user classification. In addition, the
study proposes a 5%rate adjustment in 2016 and a 4% rate adjustment in 2017.
The entire 2014 Medic 1 Cost of Service Study will be made available on the Fire Department
page of the City of Port Angeles website.
If you have any questions regarding the Cost of Service Study prior to the meeting, I can be
reached at 417-4653 or by email at kdubue @cityofpa.us.
2014 Medic I Utility Cost of Service Stu(y Executive Summary
The City of Port Angeles Medic I program is structured as a utility — supported through an Enterprise
(Medic I) Fund using transport charges, a monthly utility charge, and a General Fund contribution.
Medic I funding is structured around a cost of service approach, with periodic cost of service studies
conducted in order to ensure that the utility is properly funded. It is the purpose of this study to identify the
current costs for the provision of Medic I ambulance and EMS service and to determine if rate adjustments
are required in order to more closely reflect the present cost structure of the utility.
There are some guiding principles that are considered when setting utility rates. First, a utility aggregates its
expenses for a period of time to determine the revenue required to cover-those expenses. Once the costs are
known, and the total revenue requirement has been quantified, this requirement is allocated to the users of
the service in a manner that reflects the costs incurred to simply make the service available to everyone and
then the costs required to meet any additional demand for the services by specific user classifications.
Finally, once the costs for availability and demand are determined and the revenue requirement is known,
the rate to be charged can be set. The rate charged may include some consideration based upon a customer's
ability to pay.
This Medic I Utility Cost of Service Study has concluded that the availability cost associated with providing
the Medic I utility in Port Angeles is currently 40% of the total cost of providing the service, less General
Fund support and miscellaneous revenue. The remaining 60% of the costs is attributed to deinancl.
In order to complete this study, the Fire Department conducted a retrospective evaluation of the calls Medic
I responded to during 2013. These Medic I calls for service originated from nine different user
classifications: residential, commercial/business, assisted living facilities, 24-hour nursing facilities, group
homes, adult family homes,jail facilities, schools and city public areas.
The Medic I Utility is funded partially by a monthly charge to the nine user classifications identified above.
The fees are comprised of an availability charge and a demand charge. To meet the utility's current budget
obligations, this Cost of Service Study has identified that the combined charge requires a rate adjustment for
each user classification. A multi-year option is proposed, with a 6%rate increase in 2015, followed by a 5%
increase in 2016 and a 4% increase in 2017. The following table outlines the utility's current rates along
with the rates proposed by this Cost of Service Study.
ii
2014 Medic I Utility Cost of Service Stun y Executive Summary
TABLE 1
User Classifications Proposed 5% 4%
Current Annual # of Increase Increase
Annual Rates Rate Per Year Units 2016 2017
Rates 2015
Residential $65.14 $69.05 Per Unit 8,661 $72.50 $75.40
Adult Fainily Homes $1,063 $75 Per Classification 1 $78.75 $81.90
Assisted Living Facilities $15,690 $14,029 Per Classification' 4 $14,730.45 $15,319.67
24-Hour Nursing Facilities $3,089 $2,666 Per Classification 1 $2,799.30 $2,911.27
Group Homes $2,416 $753 Per Classification' 4 $790.65 $822.28
Jail Facilities $1,609 $1,756 Per Classification' 2 $1,843.80 $1,917.55
Schools $2,534 $3,241 Per Classification' 8 $3,403.05 $3,539.17
COminerciaUBusiness $68.54 $74.92 Per Unit 1,246 $78.67 $81.81
City Public Areas $16,155 $18,673 Per Classification 21 $19,606.65 $20,390.92
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� Utility Advisory Committee Memo
Date: October 14, 2014
To: Utility Advisory Committee
From: Phil Lusk, Deputy Director of Power and Telecommunications Systems
Subject: Industrial Transmission Electric Rate Ordinance Amendments
PAMC 13.12.071 Schedule IT-11—Industrial Transmission
Summary: The Bonneville Power Administration Tiered Rate Methodology went into effect on
October 1, 2011. Changes have been made to some of the City's allocations for the FY2015 rate
period, and a comprehensive Cost-of-Service evaluation suggests than an increase to the Industrial
Transmission customer's basic charge is warranted. The proposed amendments will be presented
at today's meeting.
Recommendation: Forward a favorable recommendation to City Council to adopt the
proposed Industrial Transmission electric rate ordinance amendments, to proceed with the
public hearings on the ordinance amendments, and to also make minor modifications to the
amendments if necessary.
Background/Analysis: The Bonneville Power Administration Tiered Rate Methodology
(TRM)went into effect on October 1, 2011. Changes were made to the ordinance to allow it to
become more prescriptive in allocating the TRM between the City's principal electric load centers.
Additionally, using a model developed by the City's Cost-of-Service (COS) consultant, the FCS
Group, a comprehensive COS evaluation suggests than an increase to the Industrial Transmission
(IT) customer's basic charge is warranted.
Following a presentation, staff will seek a recommendation from the Utility Advisory Committee
to the City Council regarding the COS adjustment to the IT customer's basic charge as a part of the
2015 amendments to the IT electric rate ordinance.
This recommendation will be taken to City Council for its consideration on October 21, 2014, and
the first scheduled hearing on that date will allow public input. The public hearing would be
continued to November 4, 2014, at which time the public hearing would be closed.
Attachment: Draft Industrial Transmission Electric Rate Ordinance Amendments
N:\UAC\MEETINGS\UAC2014\UAC101414\IT Electric Rate Ordinance Amendment.docx
ORDINANCE NO.
AN ORDINANCE of the City of Port Angeles,Washington, amending Title
13, Chapter 13.12 of the Port Angeles Municipal Code relating to the
Industrial Transmission electric rate classification.
THE CITY COUNCIL OF THE CITY OF PORT ANGELES DO HEREBY ORDAIN AS
FOLLOWS:
Section 1. Portions of Ordinance No. 2173 as amended, and Port Angeles Municipal
Code section 13.12,07,part E. subsections 5 and 7 are amended to read as follows:
E. Rate and charges. The rates and charges for service hereunder is the sum of the
amounts determined in accordance with sections 2 through 11 for each month.
5. Load shaping charges and credits.
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October 2014 22,035,274 April 2015 15,665,637
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November 2014 26,120g20 - MdLzw 30,525,934
December 2014 26.089.142 June 2015 26.307.469 :
January 2015 2 111 il Q1 I 7Y 7 July 2200115 28131155
February 2015 21,461,196 August 2015 21169.4
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December 2014 16,238,763 June 2015 14,459,901
January 2015 15170J99 July 2200115 14293.571
February 2015 i-1206221122 066 August 2015 l3j42,3
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March 2015 13,687,577 �-September 2015 12,429,569-
7. Basic Charge: Customer will pay to the City a basic charge of$3-.37.4 j4 242.00
per month.
Section 2 - Corrections. The City Clerk and the codifiers of this ordinance are
authorized to make necessary corrections to this ordinance including, but not limited to, the
correction of the scrivener's/clerical errors, references, ordinance numbering,
section/subsection numbers and any references thereto.
-2-
Section 3 - Severability. If any provisions of this Ordinance, or its application to
any person or circumstances, are held invalid, the remainder of the Ordinance, or application of
the provisions of the Ordinance to other persons or circumstances, is not affected.
Section 4 -Effective Date. This Ordinance, being an exercise of a power
specifically delegated to the City legislative body, is not subject to referendum. This
ordinance shall take effect on November 15, 2015 after passage and publication of an approved
summary thereof consisting of the title.
PASSED by the City Council of the City of Port Angeles at a regular meeting of said
Council held on the day of November, 2014.
Dan Di Guilio, Mayor
ATTEST: APPROVED AS TO FORM:
Jennifer Veneklasen, City Clerk William E. Bloor, City Attorney
PUBLISHED: 2014
By Summary
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Utility Advisory Committee Memo
Date: October 14, 2014
To: Utility Advisory Committee
From: Craig Fulton, Director of Public Works &Utilities
Subject: Blue Mountain Drop Box Facility Surcharge Rate Ordinance Amendment
Summary: Based on a recommendation from the Joint Solid Waste Advisory Committee (JSWAB), City
staff has reviewed the 2015 thru 2019 surcharge rates for the Port Angeles Transfer Station and Blue
Mountain Drop Box Facility and is recommending a revision to the Blue Mountain Drop Box Facility rates.
Recommendation: Forward a favorable recommendation to City Council to amend Ordinance No.
3507 changing the 2015 thru 2019 surcharge rates for the Blue Mountain Drop Box Facility.
Background/Analysis City Council adopted rate Ordinance No. 3507 for the Solid Waste Collection and
Transfer Station Utilities on June 3rd 2014. This was passed to ensure there was funding for rating agencies,
bond insurers, and prospective bond buyers for the revenue bond.
The JSWAB met to discuss the 2015 Port Angeles Transfer Station and Blue Mountain Drop Box Facility
rates on September 12, 2014. The JSWAB is comprised of City of Port Angeles, City of Sequim, and
Clallam County members. The initial rates developed by the City for the 2015 included a surcharge for the
landfill relocation project. The surcharges were based upon a standard percentage applied to the 2014 rates.
The members of the board asked the City to review these surcharge rates. It was the consensus of the board
that the surcharge should be the same for each ton of solid waste refuse delivered to the transfer station
rather than using a percentage of the prior rate which would impose a larger surcharge rate on the Blue
Mountain Drop Box Facility.
In order to ensure that there is equity in the allocation of surcharge for the landfill location project, staff is
recommending that that the rates for the Blue Mountain Drop Box Facility be changed as shown in the
attached ordinance. A summary of the changes are shown in the following tables:
Initial Surcharge Rates as adopted by ordinance /Per Ton
Surcharge 2015 2016 2017 2018 2019
Port Angeles Transfer Station $9.94 $16.89 $23.70 $30.99 $38.78
Blue Mountain Drop Box $13.75 $23.37 $32.79 $42.78 $53.65
Facility
Proposed Revised Surcharge Rates/Per Ton
Surcharge 2015 2016 2017 2018 2019
Port Angeles Transfer Station $9.94 $16.89 $23.70 $30.99 $38.78
Blue Mountain Drop Box $9.94 $16.89 $23.70 $30.99 $38.78
Facility
N:AUAC\MEETINGS\UAC2014\UAC101414\Transfer Station-Blue Mtn Surcharge Rate Amendment.docx
ORDINANCE NO.
AN ORDINANCE of the City of Port Angeles, Washington, relating to
garbage collection rates, making changes to Title 13, Chapter 13.57
of the Port Angeles Municipal Code.
THE CITY COUNCIL OF THE CITY OF PORT ANGELES DO HEREBY ORDAIN AS
FOLLOWS:
Section 1. Ordinance No. 3243 as amended, and Port Angeles Municipal Code Chapter
13.57, is amended to read as follows:
13.57.020 Rates.
D. All self-haulers shall be charged and shall pay the following rates per ton at the Blue
Mountain drop-box:
1. $237.40 The rate shown in the following table per ton for municipal solid waste,,
provided that the v�,ith a$5.00 minimum charge to a self-hauler is $5.00.
2015 2016 2017
Rate Surcharge Total Rate Surcharge Total Rate Surcharge Total
$237.40 $9.94 $247.34 $242.15 $16.89 $259.04 $246.99 $23.70 $270.69
2018 2019
Rate Surcharge Total Rate Surcharge Total
$251.93 $30.99 $282.92 $256.97 $38.78 $295.75
2. Recyclable materials deposited into the recycling drop-off facility will not be
charged a fee. Acceptable household hazardous waste will not be charged a fee.
3. The self-hauler rate shall be reduced by 4.6 percent for the federal government,
its agencies and instrumentalities.
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Section 2 - Corrections. The City Clerk and the codifiers of this ordinance are
authorized to make necessary corrections to this ordinance including, but not limited to, the
correction of the scrivener's/clerical errors, references, ordinance numbering,
section/subsection numbers and any references thereto.
Section 3 - Severability. If any provisions of this Ordinance, or its application to
any person or circumstances, are held invalid, the remainder of the Ordinance, or application of
the provisions of the Ordinance to other persons or circumstances, is not affected.
Section 4 -Effective Date. This Ordinance, being an exercise of a power
specifically delegated to the City legislative body, is not subject to referendum. This
ordinance shall take effect on January 1, 2015 after passage and publication of an approved
summary thereof consisting of the title.
PASSED by the City Council of the City of Port Angeles at a regular meeting of said
Council held on the day of , 2014.
Dan Di Guilio, Mayor
ATTEST: APPROVED AS TO FORM:
Jennifer Veneklasen, City Clerk
William E. Bloor, City Attorney
PUBLISHED: 2014
By Summary
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