G-906 - 11/10/2009 - WATER CHARGES - Ordinances Supporting DocumentsIT1:H 10.11.1)
AGENDA ITEM
Regular Board of Trustees Meeting
of
November 10, 2009
SUBJECT: Water Rate Adjustment
FROM: Michael Hullihan, Public Works Director
BUDGET SOURCE/BUDGET IMPACT: Impacts Water Fund Revenue
RECOMMENDED MOTION: I move thatthe Village Board approve Ordinance 2009 -
WA -G -906, AN ORDINANCE AMENDING CHAPTER 5 OF TITLE 8 OF THE
VILLAGE CODE OF THE VILLAGE OF OAK BROOK, ILLINOIS RELATING TO
WATER CHARGES
Background/History:
In 2005 the Village hired the firm of Alvord, Burdick & Howson, LLC to conduct a
comprehensive water rate study for the Village's water system. The purpose of the study was to
come up with a rate program that would provide for system improvements over the next five
years, provide for storage enhancements (some of this would be bonded for), and to begin setting
aside funds for the eventual replacement of older water main segments. As a result of this study,
effective January 1, 2006 the Village's water rate was increased from $2.85 to $3.25 per 1,000
gallons. Future increases of 3% annually were required in order to finance the operating and
capital improvement program through 2020. The rate study was updated in 2007 to account for a
rebate from the Du Page Water Commission (DWC).
In early 2008 we received notice from DWC that the City of Chicago was raising its bulk water
rate by approximately 50% from 2008 -2010 (see attached memo). In order to offset this increase
and maintain the 3% increase to finance the water system's operating and capital improvement
program, the following schedule of rate increases was calculated by former finance director
Darrell Langlois:
2009 Rate increases from 3.25 to 3.45
NE
2010 Rate increases from 3.45 to 3.79
2011 Rate increases from 3.79 to 4.13
2012 Rate increases from 4.13 to 4.26
2013 Rate increases from 4.26 to 4.39
The board approved the 2009 rate depicted on this schedule. The ordinance presented tonight
would continue the scheduled plan of rate increases by changing the rate for 2010 to $3.79 per
1,000 gallons.
Out of Village Service Areas
In addition to the rate of $3.79 per 1,000 gallons for customers within the Village boundaries, a
new rate category for out of Village customers is part of the ordinance. The village serves over
1500 customers in Oakbrook Terrace, Villa Park and Hillside. The proposed rate for this
category of customers is $4.79 per 1,000 gallons of usage. As is shown on the attached survey,
other municipalities served by the DuPage Water Commission have a higher out of town rate.
The village has approximately $29M in improvements in "out of Village" areas over the next 20
years. The added $1.00 per thousand gallon rate will partially offset the costs of these
improvements. This increase will generate approximately $137,000 in additional revenues per
year. The village could consider raising the rate closer to the average differential between
resident and non resident rates of other communities in DuPage($2.20). The board may want to
wait for the completion of the revised rate study as described below before increasing the rate
beyond $1.00.
The requirement for these water main replacements over a relatively short period of time stems
from the fact that the mains were installed at roughly the same time. The water mains are all
exceeding the expected 50 year life within a 20 year period. The history of water line breaks per
service area confirms that the mains are becoming unreliable as they exceed 50 years in age.
The staff also recommends that the village update the 2005 water rate study based on changes in
the water fund capital improvement plan since that time. The village is accelerating the schedule
of water main replacements in some areas in and out of the village. As an example, in the
proposed 2010 budget, we are expecting to replace water mains in Timber Trails subdivision
based on significant water main breaks in that area the last few years. In the current rate study,
these mains were projected to be replaced in 2017. On the other hand, the 2005 rate study
includes options of significant capital improvements including upgrading and constructing
storage facilities in the next 2 years. Staff does not believe that all of these improvements are
needed right now and may not be needed for a long time if the village divests itself of some out
of town water facilities. The new study should also review the pros and cons of the village
potentially divesting itself of out of town systems as we recently did with the Elmhurst Yorkfield
water system or potentially adding out of town customers.
Both the resident and non resident rate increases as described above are included in the proposed
2010 budget you received last week. Our proposed rate of $3.79 per 1000 gallons for residents
and $4.79 for non residents compares to the survey average of $4.32 per 1000 gallons for
residents and $6.52 for non - residents.
Recommendation:
I recommend
• approval of the attached water rate increase ordinance.
• that the staff be instructed to prepare a request for proposals for update of the 2005 water
rate study and updating of the village's water system capital improvement plan. These
plans should include an appropriate target rate structure for village and non resident water
rates the next 10 years. The capital plan will review the village's current water main
replacement schedule and review the need for additional water capacity
r
November 13, 2007
Mr. David Koch
Village Of Harwood Heights
City of Chicago 7300 W Wilson Avenue
Richard M. Daley, Mayor Harwood Heights, IL. 60706
Department of Water Management Dear Municipal Water Supply Customer:
John F Spatz. Jr.
ComnitsSioner I am writing to inform you that today City Council passed Mayor Richard M.
Jardine Water Purification Plant Daley's 2008 Budget. Please be advised that water rate increases were
1000 East Ohio Street approved as follows:
Chicago, Illinois 60611
(312) 744 -7001
(3 12) 744- 9631(FAX) January 1, 2008 15%
(312) 744 -2968 (TTY) January 1, 2009 15%
http. / /www.cityofchtcago org/ January 1, 2010 14%
natermanagement
These rate increases are necessary as they will allow us to continue to provide
the level of service you expect as a customer, increase our water and sewer
infrastructure renewal and replacement program, and to proceed with facility
upgrades.
These rate increases are needed to keep up with the increasing costs of
operations and maintenance due to increases in labor,, materials, energy and fuel
costs, rising costs of construction to maintain and replace aging infrastructure,
increasing costs of capital projects and costs associated with regulatory
compliance.
Our pumping stations and treatment plants are well maintained, but aging. In the
last 10 years we have continued with investing in our facilities. An example of
some of these projects included the investment of over 215 Million Dollars on
projects including the expansion of the 79th Street Outlet Tunnel, the conversion
of the Roseland Pumping Station from steam to electric, a roof replacement at
the Jardine Purification Plant and new chlorine facilities at the South Water
Purification Plant. With each improvement security upgrades are included to
ensure that they are not only more efficient but also safer. These rate increases
allow us to continue to make improvements to our facilities without delay.
We will continue to in vest to efficiently maintain all of our assets used to deliver
water to over 5 million people in the Chicagoland area.
Should you have any questions, please feel free to contact me at 312- 744 -7001.
Sik-
Jo;F.Spatz, J .
Commissioner
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DuPAGE WATER COMMISSION CUSTOMER WATER RATE SURVEY
WATER RATES REFLECT RATES IN EFFECT AS OF:
August 31, 2009
NOTES
1 LABORATORY USE ONLY
2 RATE FOR UNINCORPORATED IS $4 40 x 2 PER 1,000 GAL RATES EFFECTIVE AS OF 7/1/09
3 RATE IS $4 84 /K AFTER 10KGAL ALSO THERE IS A CAPITAL RECOVERY CHARGE OF $3 52/K
4 5,000 GAL MINIMUM PER BILL
5 COMMISSION WATER CHARGE OF $1 75 IS ADDED TO CUSTOMER RATE
6 $10 00 BASE CHARGE PER BILL
7 BILLED $3 04 PER UNIT 1 UNIT = 750 GAL
8 ACTUAL BILLING UNITS ARE CUBIC METERS (264 2 GAL/M3 )
3 $1 24 / 1000 GAL PLUS $2 12 / KGAL LAKE MICHIGAN WATER CHARGE
10 2K GALLON MINIMUM CHARGE PER BILL
11 3000 GAL PER MONTH MINIMUM
12 EXCLUDES $7 00 PROCESSING FEE PER BILL
13 PRICE FOR COMMERCIAL IS UP TO 100K UNITS AFTER 100K IS $1 55 /U ALSO BILLED PER 100 CU FT
14 EXCLUDES $7 00 SREVICE CHARGE PER MONTH
15 3000 GAL MINIMUM PER BILL
16 EXCLUDES $4 50 ADMINISTRATION FEE AND $1 20 BUSINESS CROSS CONNECTION FEE
17 1 ST KGAL @ $9 00, > 1 KGAL @ 4 00 PER KGAL ALSO BILLED BI- MONTHLY
18 1 ST KGAL @ $9 00, > 1 KGAL @ $5 00 /KGAL ALSO BILLED MONTHLY
19 BILLED $2 15 PER 100 CU FT
20 CURRENT RATE INCREASING BLOCK RATE 1- 36KGALS @ $3 99 /KGAL, >36KGALS @ $4 60 /KGAL
21 INCREASING RATE 1- 12KGALS @ $3 99 /KGAL, >12KGAL @ $4 60 /KGAL PLUS MONTHLY CHARGE PER METER
(2" METER = $129 03, 5/8" METER = $51 62)
22 2500 GAL MINIMUM PER BILL
23 INCLUDES $2 39 BASE CUSTOMER CHARGE FOR 1ST KGAL
24 EXCLUDES BASE CUSTOMER CHARGE FROM $14 40 - $24 00 DEPENDING ON METER SIZE
25 IAWC RATES ARE NOT INCLUDED IN AVERAGE, MINIMUM, MAXIMUM INSIDE OR OUTSIDE CORPORATE LIMIT RATES
ORDINANCE 2009 -WA -G -906
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 That Section 8 -5 -2 -G of the Village Code of the Village of Oak Brook, Illinois be and is
hereby deleted in its entirety and replaced as follows
G Water Consumption Charges
1) A monthly service charge of seven dollars ($7 00) per customer account is hereby
imposed, effective for any billing periods after January 1, 2003
2) Effective January 1, 2010 water shall be charged at the rate of three dollars and
seventy -nine cents ($ 3 79) per thousand gallons for customers in the corporate limits of
the Village of Oak Brook and at the rate of four dollars and seventy -nine cents ($4 79)
for customers outside the corporate limits of the Village of Oak Brook
3) Effective January 1, 2010 water drawn from the hydrant at 3003 Jone Boulevard shall
be charged at a rate of five dollars and forty five cents ($5 45) per thousand gallons
Section 2 That all ordinances in conflict with the provisions of this Ordinance are hereby repealed
to the extent of such conflict
Section 3 That this Ordinance shall be in full force and effect from and after passage, approval
and publication, as provided by law, however, the water consumption charges as set forth in Section 1 of
this Ordinance shall only be effective for any water consumed after December 31, 2009
Section 4 The Village Clerk is hereby authorized and directed to publish this Ordinance in
pamphlet form as required by law
APPROVED THIS 10th day of November, 2009
John W Craig
Village President
PASSED THIS 10" day of November, 2009
Ayes
Nays
Absent
ATTEST
Charlotte K Pruss
Village Clerk
Ordinance 2009 -WA -G -906
Water Rates 2009
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