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G-1040 - 10/28/2014 - WATER CHARGES - Ordinances Supporting Documents ITEM 1 0.B.1) Cof oil,t- ,po. At litA iiii'',4•4,Q.11, it V ‘aliit4c4"''V"A 0 ' COUtill' ..... , AGENDA ITEM Regular Board of Trustees Meeting of October 28,2015 SUBJECT: Water Rate Adjustment FROM: Michael Hullihan,Public Works Director BUDGET SOURCE/BUDGET IMPACT: Impacts Water Fund Revenue RECOMMENDED MOTION: I move that the Village Board approve Ordinance G-1040, An Ordinance Amending Chapter 5 of Title 8 of the Village Code of the Village of Oak Brook,Illinois Relating to Water Charges, Background/Historv: In November 2010 a water rate study was presented to the Board setting forth the strategy for future rate structures. The conclusions of the study were: • The priorities of the water CIP (Distribution and pumping facilities) are sound • Rate increases are required to fund the CIP and maintain a reasonable cash reserve in the water fund • Replacement of the distribution system in out of Village service areas is imminent and is a significant future liability Subsequently, the Du Page Water Commission(DWC)raised our bulk water purchase rate by 10% (May 2011). In October 2011 the DWC announced rate increases of 2012 30% 2013 20% 2014 18% /6" 2015 17% In order to keep the Water Fund solvent, staff has formulated a new proposed rate structure. The new proposed rates are: 2013 2014 2015 Resident Rate $6.28 $6.97 $7.73 Non-Resident Rate $7.68 $8.37 $9.13 This rate structure will allow us to attain the following goals: • Supply sufficient funds to operate and maintain the water system • Provide enough funding to pursue capital improvements at a reasonable pace • Maintain a minimum of six month operational reserve Out of Village Service Area Surcharge The out of Village service areas which Oak Brook services include Westdale Gardens (unincorporated Cook County), Brandywine (unincorporated Du page County), parts of Oak Brook Terrace, and Chateau Loire/Chambord/Oak Brook Colony (unincorporated Du Page County). Out of Village Service Area Surcharge 1.60 — — 1.40 1.20 __ 1.00 i- — i 0.80 0.60 0.40 — 0.20 0.00 _ 2010 2011 2012 2013 2014 2015 As a result of the Water Rate Study (April 2010) a $1.00 surcharge was imposed on these areas in 2010. The surcharge has risen to $1.40 per thousand gallons. The proposed rate structure does not increase this surcharge above $1.40. The out of Village rate is also charged for bulk customers who draw water from the metered hydrant at the Public Works yard. Future Rate Adjustments The significant rate increases levied by the Du Page Water commission from 2010-2015 have adjusted our cost for bulk water to take into account the significant raises imposed by the City of Chicago. We should expect significantly smaller increases for the upcoming years. Nevertheless, the last water study will be five years old and a water study will be completed in 2015 for the 2016-2020 time period. As the significant assumptions and cost factors have stabilized,this study will be done in-house. This will save the Water Fund approximately $20,000. Recommendation: I recommend approval of the attached water rate increase ordinance. ORDINANCE 2014-WA-G-1040 AN ORDINANCE AMENDING CHAPTER 5 OF TITLE 8 OF THE VILLAGE CODE OF THE VILLAGE OF OAK BROOK, ILLINOIS RELATING TO WATER CHARGES WHEREAS, the President and Board of Trustees of the Village of Oak Brook, Illinois have heretofore, by ordinance established rates, fees, and service charges for water usage; and WHEREAS, the President and Board of Trustees deem a revision of the water rates, fees, and charges, and the passage of this Ordinance to be in the best interest and in pursuance of the general welfare of the Village; NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows: Section 1: Recitals. The foregoing recitals are hereby incorporated into, and made a part of, this Resolution as the findings of the President and Board of Trustees of the Village of Oak Brook. Section 2: Section 8-5-2-F of Chapter 5, "Fees and Charges," of Title 8, "Public Works," of the Village Code is hereby amended further to read as follows: F. Water Turn On Charge: Turning on water following the interruption of service shall be subject to a charge of forty fifty dollars ($4900 50.00) during normal working hours and seventy five eighty-five dollars ($7-5,00 85.00) after normal working hours. Notwithstanding the previous sentence, turning on water following the discontinuance of service pursuant to provisions of section 8-2C-4 of this title shall require the payment of a two hundred dollar($200.00) charge. Section 3: Section 8-5-2-G of Chapter 5, "Fees and Charges," of Title 8, "Public Works," of the Village Code is hereby amended further to read as follows: G. Water Consumption Charges 1. A monthly service charge of seven dollars and thirty-three cents ($7.33) per customer account is hereby imposed, effective for any billing periods after January 1, 2014. 2. Effective January 1, 28-1-4 2015 water shall be charged at the rate of six seven dollars and ninety-seven seventy-three cents ($6.97 ZZh) per thousand gallons for customers in the corporate limits of the Village of Oak Brook and at the rate of eight nine dollars and thirty-seven thirteen cents ($8.37 9.13) for customers outside the corporate limits of the Village of Oak Brook. 3. Effective January 1, 2044 2015 water drawn from the hydrant at 3003 Jorie Boulevard shall be charged at a rate of seven nine dollars and five thirteen cents ($7.05 9.13) per thousand gallons. 4. A • - -•• -, - " -- -- -•e '' - , - -- - -- Section 8 5 2 G shall receive a one-dollar ($1.00) discount off of each invoice issued Additions are bold and double-underlined; :_ - - - -- -- • Ordinance 2014-WA-G-1040 Water Rates 2015 Page 2 of 2 during the one year period from the date on which the customer first signed up for direct debit payment. This discount shall not apply to any-customer who has madc O. ee e e . -- charged pursuant to this Section 8 5 2 G. Section 4: Severability. If any provision of this Ordinance or part thereof is held invalid by a court of competent jurisdiction, the remaining provisions of this Ordinance shall remain in full force and effect, and shall be interpreted, applied, and enforced so as to achieve, as near as may be, the purpose and intent of this Ordinance to the greatest extent permitted by applicable law. Section 5: Effective Date. This Ordinance shall be in full force and effect beginning on January 1, 2015 and after passage, approval and publication, as provided by law. APPROVED THIS 28th day of October, 2014. Gopal G. Lalmalani Village President PASSED THIS 28th day of October, 2014. Ayes: Nays: Absent: ATTEST: Charlotte K. Pruss Village Clerk Additions are bold and double-underlined; :- - e• - - -- • ---•.