HomeMy WebLinkAboutAgenda Bill 4BPart1 06/21/2010~}~' L U
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DATE:
TO
.Tune 21, 2010
I=Ibnorable Mayor and Members of the City Council through City Manager
FROM: Eric Danly, City~Attorriey
SUBJECT: City Council Consideration and.Direction to Staff Regarding Submission of a
Ballot Argument Against and a Rebuttal Argument in,Response to the Proposed Voter Initiative
to Reduce City of:Petaluma Wastewater Service Rates to Rates 'in,`Effect on January 1, 2006, To
Be Submitted to the Voters at the. November 2, 2010, Statewide Election.
I2ECOM'1VIENDAT'ION:
Provide direction to staff regarding submission of a ballot argument. against and a rebuttal
argument inresponse to the proposed voter initiative to reduce City of Petaluma wastewater
servi,'ce rates to rates in effect on January 1, 2006, to be submitted to the voters at the November
2, 2010; statewide election.
BAGI~GIZOUND:
On January 15, 2009, a voter initiative was filed with the City Clerk: If approved, the initiative
would reduce the City's wastewater service rates updated effective January 1, 2007, "via
Resolution No: 2007-023 to rates established by Resolution No. 2002-1.89; which were the rates
in effect on January 1, 2006:. Because Resolution No. 2007-023 provided for annual increases to
'the City's wastewater rates, the. initiative would roll back four years of rate 'increases. A title and
summary of the initiative was provided to the initiative filer on January 29, 2009: Initiative
proponents filed signed petitions with the City Clerk on.July 22, 2009, which were forwarded to
the Sonoma County Clerk pursuant to the City's contract with the County.. The County Clerk
provided a;certf Cate concerning its review of the petition sections. In accordance with the
El`ee ioris;Code; the City Glerk examined the petition sections and certified the results of her
examination atahe September 14; 2009, City Council meeting. At that meeting, the Council also
ordered:the p"reparation of~a report concerning fiscal and other impacts ofthe`proposed initiative.
On October 13, 2009; the City Council reviewed and.discussed the Report on Potential Fiscal
and Other Impacts and adopted Resolution No. 20.09-T70 consolidating the. election on the
measure~with'the statewide general election; submitting the measure for the November 2, 2010
bal'lbt and":directing the City Attorney to prepare an impartial analysis of'the proposed ballot
measure.A; copy of the Agenda Bill and attachments thereto for the October 13, 2009, City
Council~meeting; which included the ballot materials received to date, County and City Clerk
certifications, Resolution No: 2009-170, and-the Report'on Fiscal and Other Impacts, are
contained in Attachment l .
Agenda Revie. _~
,,
Dept. Directo City Attorne Finance Director City Man 1
DIS.GLTSSION:
1'. Argument Against the 1Vleasure
Elections Code sections 9282 and 9283 permit the City Council to ubmit an argument against an
initiative measure placed on the ballot by petition. The argument cannot exceed 3.00 words in
length; and maybe signed. by not more than. five persons. The. following heading must precede
the argument, but does not- count in the 300 word maximum: "Argument Against Measure
" (the ,blank° space contains the letter or number, if any, designating the measure).
(Elections (Elec.) Code § 9282.)
The ;City Council may authorize, by motion, a member or members of the Council. to prepare a
draft argument against the measure and to return the draft for consideration and adoption by the
City Council at a duly noticed meeting of the City Council. Any Council members authorized by
the City Council to do so-may sign the argument,against the measure. (Elec. Code § 9287.)
However, ifthe argument againstthe measure is signed by more than five Council members,
only~the signatures of the first. five Council members to. sign the ballot argument will be printed
with the ballot argument. (Elec. Code § 9283.) Alternatively, the .City Council may authorize,
by motion, a member or members of the City Council to cooperate with members of the
.community and/or interested parties and/or organizations to prepare a draft argument against the
measure.
The arguments must be filed with the City Clerk, accompanied by the printed name(s) and
signature("s) of the author(s). submitting, it; or if submitted on behalf of an organization the name
of the organization and the printed name and signature of at least one of its principal officers.
Arguments are,due:in the office of the City Clerkprior to St00 p.m, on 1Vlonday, August 16,
2010. (Elec. Code § 9283.)
If more than one argument for or'against the measure is submitted, .the City Clerk must select one
ar-gument for. and one argument,against the measure .for printing and distribution to the voters. In
selecting the argument, the: City'Clerk must give preference and priority in the following order:
(a) To; the City Council, or member or members of the City Council authorized by the
Council to prepare the argument;
(b) °'To. the individual voter; or bona fide association of citizens, or combination of
voters and associations,., who are the bona fide .sponsors or proponents of the measure;
(c) ' To bona fide associations of citizens;. and
(d) To individual voters who are eligible to vote on the measure. (Elec.. Code §
9287.)
2. Rebuttal Argument
Pursuant to Elections. Code section 9285, the City Council authorized. the submittal of rebuttal
arguments and adopted the .Elections Code provisions outlining. the procedures for distributing
arguments for and against the measure. Those procedures are as follows:
2
When the City Clerk has selected the arguments for and against the measure that will be printed
and distributed to the voters, the City Clerk must send copies of the argument in favor of the
measure to the authors of the argument.aganst, and copies of the argument against to the authors
of the argument in favor. (Elec. Code § 9285:) Rebuttal arguments may not~exceed 250 words
and maybe signed by more than 'five persons. However,. as with the arguments in favor and
against, only the first five persons to sign.wll be printed with the ballot measure. The persons
who; sign. the rebuttal arguments maybe different. from the persons who signed the direct
arguments. The last day for submission of rebuttal arguments for or against the measure is by
S:OOi p.m. on August 26, 201.0.
FINANCIAL. IMPACTS:
The cost of placing this item on the November 20:10 ballot is estimated between approximately
$10,000. and $17,800. These estimates include approximately $1,400 in legal support, $700 in
City;Clerk time, and County election charges ranging from $7,900 to $15,700. Monies are
budgeted in the City Clerk and Wastewater budgets to support this cost.
Total Cost of Proposal or Project: $10,000 to $17,800.
Amount 1udgeted: $80,000.
Name of Accounts: Lega1~ Services City Clcrk/Eleetions/Regular Salary Full-Time, and
Other Operating Services; and Wastewater/Administration/Other Operating Services
Account Numbers: 11`00.11310.54120; 1100.11321.51110; 1100.11321.54310;
6600.66100.5431'0
Curirent Account.l3alance: .$86;000-for F~' 201.0-11
ATTAC~IMENTS
Agenda Bill from October 13, 2009, City Council Meeting and attachments thereto.
Resolution No. 2009-170.
1459101.1
-/~i~ .1 . B_ _ ~ A AAAA
CITY OF PETALUMA, CALIFORNIA.. 'IJC.YV~ir~ ~ `~~ ~~~'
~~~~ ~~~
Benda Title: Receive-Staff Report Pursuant to California Elections Code 1Vleeting Date: -October 13, 2009
Section 921':2 Concerning the Potential Fiscal and Other Impacts of a
Proposed Initiative to Reduce City of Petaluma Wastewater Service Rates to Meeting Time: 6,:00 P1VI
Rates in Effect. on:January 1, 2006. Discussion and Possible Action to
Adopt Ordinance Reducing City of Petaluma Wastewater Service Rates to '~
Rates in Effect. on January 1, 2006; or, Subrriit the Ordi~nariee to :the Voters
Pursuant to Subdivision (li) of California Elections Code Section 1045.
Category: 0`Presentation ~ Appointments ^ Consent ^ Public Hearin .Unfinished Business
g ~, ^ New`Business
I)epartmerit: Director: Contact Person: Phone Number:.
City Clerk .I Claire .Cooper Claire Cooper 778-4361
City Attorney Eric_Danly Eric Danly 778-4362
Water Resources ard~ Mike Ban Mike Ban 778-4546
Conservation
Total Cost of Proposal or Proect: Name of Fund;
Account Number:
Amount. Budgeted: Current Fund Balance:
..commendation: It is recommended that the City Council take the following action: Adopt the proposed
resolution (Attachment 5), submitting the measure for the November 2, 2010 ballot.
1. ^ First reading of Ordinance approved`'unanimously, or with unanimous vote to allow posting prior to second reading
2. ^ First reading of Ordinance approved without unanimous vote: Ordinance has been published/posted prior"to second
reading; see Attachment
3. ^Otheraction requiring special.notice' Notice.has been given, see Attachment
I
Summary Statement: ~On:,January 1:5; 2009 a voter initiative was filed with the City Clerk.. If approved, the
initiative would reduce,the City wastewater service rates updated. effective January 1, 2007,. torates established
by.Resolution No. 2002-_189,. which were the rates in effect on January 1, 2006, -A title and summary of the
initative.was provided to. the initiative filer on January 29, 2009. On July 22, '2009, inttative~proporients filed
with, the City Clerk docurnents_;purporting to include 334 petition sections and 1:586 signatures. The initiative
petton,sections received,on July 22na were forwarded to the Sonoma County Clerk pursuant to an agreement
between the City of Petaluma and.tlle County of Sonoma concerning the provision of certain election services.
The County Clerk provided a certificate concerning its review of the petition sections. In accordance with the
Elections Code, the City Clerk examined the petition sections and certified the results of her examination at the
September 14`'' City, Counci'1 meeting. At that meeting, the Council also ordered the preparation of a report
concerning:fiscal~and otler:impacts of the proposed initiative (Attachment 6). Pursuant to Elections Code
.section 92.:15,, the.. City~Councl must; take action to either: 1) adopt the initiative measure without alteration at
tonight's meeting or'at a=regular meeting within 10 days; or 2) submit the measure for the November 2, 2010
lot.
_.
Attachments to Agenda -Packet Item:
__
1. Notice of Intent to Circulate Petition and CerEification by Proponent Regarding, Use of Signatures
2. Title and Summary for Proposed:Initiative
3. County Clerk's.. Certificate
4. City Clerk's Certificate
5. Resolution Submitting the Proposed Initiative for the November 2, 2010 Election
6: Report on Potential Fiscal. and Other Impacts of Proposed Initiative
Reviewed by Fin'ance' Director: Reviewed by City Attorney: ~ A rov _ " " , 1Vlana er:
i ~ - - >.~...~._____....__....
Date: Dates io 8 O9 Date: v -~~~d
Rev. # Date Last Revised: File:
5
CITE' ®.F PETALUMA, CALIFORNIA
October 13, 2009
AGENDA REPORT
j FOR
RECEIVE~STAFF REPORT PURSUANT TO CALIFORNIA ELECTIONS CODE SECTION 9212 CONCERNING THE
POTENTIAL FISCAL AND ®THER IMPACTS QE A PROPOSED INITIATIVE TO REDUCE CITY OF PETALUIVIA
WASTEWATER SERVICE RATES TO RATES IN EFFECT ON .IANUARY 1,.2000'. DISCUSSION AND POSSIBLE
ACTION TOO ADOPT ORDINANCE REDUCING CITY OF PETALUMA WASTEWATER SERVICE RATES' TO RATES IN
I+ FFECT ON JANUARY' 1, 2006; OR, SUBMIT THE' ORDINANCE TO THE VOTERS PURSUANT TO SUBDIVISION (B~
OF CALIFORNIA ELECTIONS'. CODE SECTION 1045.
1. RECO1vIMENDATIONi: Adopt. the proposed resolution attached as Attachment 6, submitting the measure
for the November 2, 2010 ballot.
2. BACKGROUND.: A proposed nitiative,measure, notice of intent to circulate petition, and certification
regarding use of signatures was filed by James Fitzgerald on behalf of a group called "Petalumans for
Fair. Utility Rates" ("PFUR") Ori January 1'S,, 2009. The proposed initiative was provided to the City
Attorney's office forpreparation of a ballot title and summary under Elections Code Section 9203. The
ballot title and summary were provided to: Mr. Fitzgerald on January 29, 2009. The initiative, notice of
intent to circulate and .certfication'regarding use of signatures. are contained in Attachment 1. The title
and summary are contained in Attachment 2.
The~initiative would reduce Gitywastewater rates to the rates in effect January 1, 2006. The initiative
also includes a severability clause. and provides that it may only be amended by voter approval.
i
On July 22; 2009, Mr. Fitzgerald, on behalf of PFUR, filed documents purporting to include 333
initiative petition sections and 1,S'86 signatures; and asserting that 21,850 ballots were cast in Petaluma
for the November 2006 gubernatorial election, and that therefore, under Article XIIIC, Section 3 of the
California Constitution, 5% of the votes east, or 1093 valid signatures were required for certification of
the measure.
The July 22 initiative petition submission was forwarded that day to the .Sonoma County Clerk pursuant
to an agreement between -the City of Petaluma and the County of Sonoma providing for the performance
of certain election services~by the County Clerk.
On July 24, 2009, the .County Clerk's office provided a certificate stating: that.: the. petitions were received
by the County Clerk on July 22, 2009; the petitions consisted of 333 sections and had attached to them
affidavits purported; to be of the signature gatherers containing the dates the signatures were gathered,
and stating that. signatures were signed in the gatherers' presence; that the County Clerk verified.
signatures by examining County voter registration records, and that the County Clerk counted the
following signatures:
(o
Unverified (raw count) , „ 1..,579
Verified signatures. 1;,390
Verified, ,sufficient. signatures 1,,169
Verified. signatures not sufficient. 201
The County Clerk's certificate also gave 1093 as the required number of signatures for certification,. and
provided a statistical breakdown of the signatures checked'. See Attachment 3.
3. DISCUSSION:
In accordance with he Elections Code,. the City Clerk, as the City Elections Official, had 30 working
days from.July 22, or until September 2, 2009, to examine the petition sections and determine their
sufficiency. The City Clerk. certified the sufficiency of the petitions at the next regular City Council
meeting on'September 14,,2009.: See Attachment 4. At the September 14~' meeting, the City Council
also ordered staff to submit' areport concerning potential fiscal; general plan;and zoning, land use,
infrastructure,.and other impacts of the:ntiatve pursuant to Elections Code Section 9212. See
Attachment 6. Elections Code ;Section 9215 now requires he Council to 1) adopt the initiative measure
. without alteration at tonight's meeting or a regular meeting within 10 days of tonight's meeting;. or 2)
submit the measure for the November 2, 2010 ballot (staff recommendation, see Attachment 5,
Resolution Ordering the Submission, etc.).
. ~
4. 1FINANCIAL.AND GENERAL 1PLAN IMPACTS:
Potential financial impacts. on the City are described in the Report on Potential Fiscal :and Other Impact
of Proposed'. Initiative to Reduce City of Petaluma Wastewater Service Rates to Rates in Effect on
January 1', 2006, Attachment 6 ("Report"). They include, in addition to reduction ofwastewater service
rates:for City'wastewater customers: litigation costs related..to determining the. initiative's validity;
liability -from. defaulting. on the ..State Revolving Fund.. loan; liability from defaulting; on outstanding
wastewater revenue bonds; liability due to breach of snatching grant:oblgations; reduced funding for
City and. Petaluma Community .Development Commission debt-funded projects; increased f nance costs
for the wastewater enterprise;. negative impact on existing City credit;. increased. cost and/or
unavailability of debt financing for other City operations;: City liability for unfunded debt service; cuts in
other City department operating budgets to replace 'lost wastewater revenues from General Fund
revenues; a reduced ability of the City's General Fund to grow over time; and insolvency of the City if
insufficient funds are;available from -other sources to replace lost wastewater revenues and maintain
essential. services.
Ir addition to fiscal impacts; reduced revenue from the proposed initiative could' jeopardze~
implementation of the City's .recycled water program which is necessary to offset potable water use and
thereby"p"rovi'de additional potable water supply for General Plan 2025 development. The proposed
initiative is therefore. inconsistent with General Plan 2025 water supply goals, policies and programs.
The proposed initiative is, also. inconsistent with other General Plan 2025 goals, policies and programs,
as more fully described in the Report. These include maintaining wastewater system facilities that
protect the envronrnent~ a:nd meet regulatory discharge requirements, .preserving groundwater for
emergency and peak d'esnand uses, and providing adequate services for General Plan buildout to meet
State and General Plan 2025 housing .goals and General Plan 2025 fiscal health and- economic
sustainabilty goals:
:1305579'.2
NOTICE OF INTENT TO CIRCULATE PETITION ,
Notice is hereby gi,~en by the persons whose names appear hereon of their intention to circulate a petition
within the City of Petaluma for the purpose of reducing wastewater rate increases made in City Council
Resol~ition No: 2007=023.
I
i
A statement of the reasons ofthe proposed action as contemplated in the petition is as follows:
~ 1) Many seniors, renters, small businesses and low-income families will not be able to afford
I
the huge rate increases adopted by the Petaluma City Council.
2) Development must contribute its fair share of the cost to increase the capacity of the
wastewater system and not unduly burden the existing ratepayers.
3) The City of Petaluma has been m''isappropriating'wastewater revenuesto cover the general
fund expenditures.inuiolation of the Charterofthe City of`Petaluma.
~~ ~ r ~~~
Mr. ~ es W. Fitzgera oard Member,
Pet umans for Fair Utlity'Rates
405 ~Uia Gigi Street Petaluma; CA 94952
Initiative Measure to be Submitted to the Voters
TI-hE PEOPLE OF THE CITY OF PETALUMA DO ORDAIN AS FOLLOWS:
SECTION I: The rate schedule for°wastewater service set forth in .Resolution No. 2007-023 of the
Petaluma City Council shall be .reduced to the rates established by Resolution No.
2002-.'189; which were the rates in effect on January 1, 2006.
SECTION II: If any provision of this measure or the application thereof to any person or
circumstances. is held invalid., that invalidity shall not affect other provisions or
applications; and to this end the provisions of this measure are severable.
SECTION III: This measure may not be amended except upon voter approval.
Q
Certification by proporient..of initiatwe`measure; use of signatures
I, James. VJ. ;Fitzgerald, acknowledge that it is a misdemeanor under state law
(Section 18.,650' of the Elections Code) to knowingly or willfully allow the
signatures on an initiative petition to be used for any purpose other than
qualf caton~of the proposed. measure. for the ballot. 1 certify that I will
riot knowingly or willfully allow the,. signatures for this initiative to be
used for any purpose other than qualification of the measure for the ballot.
ames W. Fit ger
Dated this 7th day of January, .2009
p.
;INITIATIVE TO RE,pUCE CURRENT CITY'OF PETALUMA WASTEWATER
SERVICE RATES TO RATES IN EFFECT' O;N JANUARY 1, 2006
The initiative measure would reduce the.wastewater service rate Schedule established by
City of Petaluma Resolution No. 2007-23, effective February 1,.2007, to the rates that were in
effect on January 1, 2006: pursuant to City of Petaluma ResolutionTlo. 2002-189.
. If any provision or application of the initiative measure is held invalid, that invalidity is
not intended to affect any other provision or application of the initiative measure.
The initiative measure may not be amended except by subsequent voter approval
i
Dated: January 29; 2009
~,
:' J~~ .
By ~/
Eric W. Danly
City Attornfy, City of Petaluma
118743.1.1
Cle-lc-Recorder-Assessoir
~~~~•«•aonc)nla-county.or~era
CLERK'S CERTIFICATE
TO INITIATIVE PETITION
REGISTRAR OF
VOTERS DIV1S10N
PO_ Box 1 14K~
435 Fiscal l)r.
Santa' Rosa, G1 95406
Tcl: (-711.'• j 5(i5-6800
Toll Lire{CA onlv):
(SOOj 7~l)-V"UTE
flax:1707) 5(i5-6843
1, JANICE ATKINSON, SQNOMA COUNTY CLERK AND REGISTRAR OF VOTERS, COUNTY
OF SONOMA, STATE OF CALIFORNIA, HEREBY CERTIFY:
That the Initiative to Reduce Current City of 'Petaluma :Wastewater Service Rates to Rates in
Effect on:January' 1., 2006', Initiative petition was received by our office on July 22, 2009. Said
petition consists of 333 sections;
That each section contains ignatures purporting to be the signatures of qualified electors in the
City of Petaluma, County of Sonoma;
That atfached to .each section of this petition at the time it was filed`was an affidavit purporting to
be the affidavit of the person who solicited the signatures, and containing the dates between
which the purported qualified elecfors signed this petition;
That the affiant stated his or her own qualification, that he or sle had solicited the signatures
upon. that-section, that all of the signatures were made in his or her presence, and that to the
best of his or her knowledge and belief each signature to that section was the genuine signature
of the person whose name it purports to be;
That I verified the required. number of'signatures by examining the records of registration in this
county, current and in effect at the respective purportiue .dates of such signing fo determine
what .number of qualified elecfocs signed the petition, and from that examination I have
deitermined~ the following'facts regarding this petition:
~1) Number of unverified signatures filed by proponent. (raw count} 1.579
'2) Number of verifed sigriafures 1,370
a) Number of signatures found sufficient 1,169
b) Number of signatures found. not sufficient 201
(1 } Not sufficient because duplicate 4
IN;WITNESS' WHEREOF,. I have hereunto set my hand and affixed 'my official seal this 24`h day
of July, 2009.
JANICE ATKINSON,
SONO~MA COUNTY CLERK-&- -R- EGISTRAR OF VOTERS'
BY: '~ ) ~ ~r~~ ,~.L~..z:~ l,l.; Deputy
Debra Russofti; ';D'eputy
12
:~-'~e '
~a,.;
~ ~~ `'' Petition Result Breakdown
;.:J
49 -.Petaluma Reduce`;Was,tewater Service Rates-.
. .
,: ,
,:._ _,
Petaluma Reduce Wastewater Service Rates ~
.
,.
-: _
Signatures Required 1093
Raw' Count 1,579
Sample Size 1,579 Percent o! Percent of
Sigs Checked
1,370 Sigs. Checked Sample Size
Sigs Not. Checked 209 13.2
Sigs Valid 1,169 85.3 % 74.0
Sigs Invalid. 201 14.7 °i° 12.7
Duplicated 4 0.0 % 0.3
Non-duplicate Invalids 197 14.0 % 12.5
RE$ULTABBR RESULTDESCRIPTIgN.
<.
Approved Approved 1,169 85.3
NotReg Not Registered 119 8.7 %
OutOfDist Out of District 7 0.5
Duplicate Signed. more than once 4 0.3 %
Reg Late Registered Late 2 0.1 %
RegDiffAdd Registered at a Different Address 37' 2.7 %
Cantldntfy Cannot Identify 3 02 °~°
NoResAdd No. Residence Address Given g 0.4 %
SigNoMatch Signatures Don't Match 23 1.7 °j°
1~
;MR012 -Petition Result Breakdown Page 1 of ~
,inted; 7!24/2009' 8:37:28ANf
City Clerk's>Certifcation
(Cal'Elec. Cnde,§4.114)
Initiative to:Reduce City of Pefaluma.'Wastewater Service Rates
to Rates in Effect on January 1, 2006
The following certification;is made by'the,Petaltima City Clerlc in her capacity as
Eiectioiis Official ,.for the City of Petaluma pursuant to Elections. Cade Section 9114 and'
other applicable law. In accordance with Section 9..114 the.Electons Official is required
to examine.initiativepetltions and to determine whether'they are signed by the requisite
number of voters within 30 days (excluding Saturdays, ~Sunday5,, and holidays} from the
date of the filing of the patiti`on; ,and, if the petition,is found sufficient;. fo certify the
results of the examination of the next regular meeting of the legislative body.
Factual Bactcgrourid
On 7anuary 15,,2009, James Fitzgerald filed an initiative measure; notice of intent
fo circulate petifon and: `cerhfication.regardinguse ofsignatures: for, an initiative on
behalf of a group called "Petalumars for Fair Utility Rates" ("PFLJR") that would reduce
the City of Petaluma wastewater service rates: to rates in effect January 1, 2006. The
initiative measure also. provided that it could not be amended except by voter approval
andinciuded a severability provision.
The measure was submitted to the City Attorney for preparation of ballot title and
summary which were provided "to 1V1r. Fitzgerald on January 29, 2009.
On July 22; ~009,'uutiatve proponents.filed documents purporting to include'333
--
petition sections. containing 1,586 signatures, and asserting that:21,850 ballots were cast.
in Petaluma.for the November`2006 gubernatorial election,. and that therefore, under
' Article XIIIC, Section 3 of.the .California Constitution, 5% of the votes castor 1093 valid
signatures are required for certification of the measure.
j
~ The July22, 2009 submission was forwarded that„day to the Sonoma County
Clerk pursuant to an agreement Ueiween the City of Petaluma_and the. County of Sonoma
providing for the performance of certain election services by the County Glerk..
On July 24, 2009, the CountyClerk's office provided a certificate; stating that: the
pehti'ons were received:by the .County C1erlc.July 22, 2009, ~the.petitions consisted:of 333
sections and:had attached affidavits purporting to be of the signature gatherers
containing'the dates~the signatures were gathered and stating that "signatures were signed
in the gatherers' presence; that the County Clerk verified signatures by examining County
voter registration records; and the County Clerk counted the following signatures:
Unverified (raw count} 1,579.
Verified signatures 1_,370
Verified, sufficient signatures 1,169
1~
Verified;sgnatures not sufficient 201
Verified signatures not sufficient because
duplicate 4
The County Clerk's certificate also gave 1093 as the required number of
signatures for certification.
Certification
The undersigned .:has examined the petition sections ,submitted July 22, 2009 in
accordance with California Elections Code Section 91-14 ,and the substantive and
procedural.. requirement's contained in California Elections, Code Section 920 et seq., and
certifies that: ~ .
1. The required number of signatures to qualify the~,initiative for the ballot is
1093 in accordance with .Article XIIIC, Section 3 of the California
Constitution and California Elections Code. Section 9035.
2•. The petition 'includes l,lb9 sufficient signatures in accordance with the
requirements of California Elections. Code Section 9200 et seq. and other
applicable law, and therefore is. sufficient pursuant to California Elections
Code Section 91.14.
'Claire- Coo er Date
~ P
Petaluma City Clerk
;1294929.1
~S
Re`solufion No.:2009-XX~'NC.S~. of the City of Petaluma, California
A RESOLUTION ~OF'THE CITY COUNCIL
OF TIME CITI' OF PETAL''UMA ORDERING TIIE SUBIGIISSION
TO THE.QUALIFIED E~LECT'ORS OF THE CITY OF AN
ORDINANCE TO' REDUCE CITY OF PETALUMA
~WASTEWATER.RATES TO RATES IN EFFECT ON JANUARY 1,
2006'AT T]EIE GENERAL'MUNICIPAL ELECTION. TO BE HELL)
ON TI7ESI)Al', NOVEMBER 2, 2Q1'O, REQUESTING TI3E
SONOMA COUNTY BOARD OF SUPERVISORS TO
CONSQLIDATE ,'SAID ELECTION WI'I'I-I THE; NOVElVIBER 2,
2010 STATEWIDE GENERAL ELEC'T'ION AND PROVIDING
FOR ST`BMISSION OF BALLOT ARGUIVIENTS ANTD
REBUTTALS'
WIIEItEAS, on Janu ~ I5 :2009 a voter initiative was filed with.the Petaluma City
~' ,
Clerk which;. if approyed'by a majority of City voters, would reduce the City wastewater
service rates to rates in effect January 1, 2006; and
WIl<EJI2EAS, on January 29, 2009,. a title and summary of the initiative. was provided to
the initiative filer; and
WIIEREAS; on July 22, 2009; proponents of the initiative filed with the City Clerk
documents,purporting to include 333 petition sections containing 1;586 signatures; and
WIIEREAS, the initiative petition sections received J:iily 22, .2009, were forwarded to
the Sonoma County Clerk pursuant to an .agreement between the City of Petaluma and the
County of Sonoma conaemng the provision of certain election services; and
WIIEREAS, the County Clerk has provided a certificate concerring review of the
petition sections; and
hVIiEREAS, Elections Code'Section 9114 requires the City Clerk, as the City Elections
Official,, to examine such petition sections and determine the sufficiency thereof within
30 working days (excluding. holidays) of filing of the petition,, or by September 2,
2009;City Council meeting; and
WII°EIiEAS, Elections Code Section 9114 provides that if the City Clerk determines the
petitions to be suff cient; the Clerk shall certify the results of her examination to the City
Council ants nextregular meeting; and
WII'EREAS, Elections Code Section 9215 requires that upori certification by the City
Clerk to the City Council; the City Council must take one of three actions prescribed
under~that ection, namely: I) adopt the ordinance, without alteration, at the meeting at
which the petition i ,certified, or a regular meeting within 10 days of that meeting, 2)
l~
.submit the ordinance to the voters pursuant to Elections Code Section 14.05, subdivision
(b) at the next regular municipal election , or 3) order staff to submit: a report concerning
:potential. fiscal; general plan and zoning, land use; infrastructure, and,other impacts of the
,initiative within 3,0 days of the meeting at which the petition is certified; and
WHEREAS, the City Clerk has certf ed he cuff ciency of the petition in accordance
°wth Elections Code Section 9114 and other applicable law; and
WHEREAS; November 2, 20:1`0 is the date of the City's next regular municipal election;
and
W>FIEREAS, SecYi'on 4 of Article III of the Petaluma City Charter provides that except as
otherwise specified in the Charter, all regular and special city elections .are to be held in
accordance-with the Elections Code, as amended; and
WHEREAS, Section 76 of Article XII of the Petaluma City Charterprovides that
.ordinances maybe enacted by and for he city pursuant to.Division 4. (now Division 9) of
Chapter 3; Article 1 of the Elections Code, as amended; and
WHEREAS, provisions of the Elections Code set. forth the procedures and requirements
for the submission of measures to the voters, including: consolidation ofmunicipal and
statewide elections, placement on the,ballot, amendment and withdrawal, submission of
ballot arguments, preparation of.impartial analysis and rebuttal :arguments;
NOW, THEREFORE; T1HE CITE' COUNCIL OF THE CITY OF
PETALUIVIA DOES H°EREBY RESOLVE AS FOLLOW:
l . Pursuant to tfie;requirements of the City of Petaluma Charter, California.
Electigns:Code Section 9215(b) and other applicable aw, there:is called and ordered to
be lield-in the City ofPetalurna; California, on Tuesday; November 2, 2010, an election
for the purpose of submitting tb the voters a measure that would reduce City of Petaluma
wastewater service rates to.rates in effect on January 1, 2006'.
2. The .ballot language for the proposed :ordinance shall be as follows:
MEASURE
"Shall ~an ordinance ;be adopted to ;reduce City of Petaluma •
wastewater service rates to rates in effect on January 1, 2006? YES
NO
11
3. The measure to be .approved by the voters pursuant to'Secton 2 of this
resolution is as set forth in Exhibit A attached hereto. -
4. (a) An election on the measure set-,forth in Section 2 shall beheld in
conjunction with the municipal election to be held in,the City of Petaluma on Tuesday,
November 2, '2010:. In .accordance°with; the. Petaluma City Charter and California
Elections Code Section 10403', the City Council. requests that theBoard of Supervisors of
Sonoma County consolidate the election on the measure with the statewide general
election on the same day{and issue instructions to the Sonoma County Election
Department to take. any and all steps-necessary for the holding of`the consolidated
election.
(b} The election on the measure et forth in Section. 2 shall be held and
conducted, the votes canvassed and the returns made, and the results ascertained and
deterrriined as provided for herein and the Elections Code.
(c) The election for the measure set forth in Section 2 shall'be held in
~ Sonoma Countyin the City of Petaluma on November 2, 20'1:0, as required bylaw, and
the Sonoma County Election Department is authorized to canvas the returns of that
election with respect to'the votes east in the City of Petaluma.
~ (d) At the next regular meeting ofthe~CityCouncil 9f the. City of
Petaluma occurring after the returns of the election for the measure set forth in Section 2
.have been canvassed and the certification of the results to the. City Council; -the City
Council. shall cause to`be entered in its minutes a statement of the results ofthe election.
5. (a) In accordance with Elections Code Section :92;82 and 9283,
i arguments submitted for or againstthe measure shall°not exceed 300 words in,length, and
shall be printed upon the same sheet of paper and mailed to each voter with the sample
ballot. for the election and maybe signed by not more than five persons.
(b) In accordance with Elections Code Section .9282, the following
headings, as appropriate, shall precede the arguments'' wording, but shall not be counted
in the 300 word maximum: "Argument Against Measure " or, "Argument For
Measure: _ " (the blank spaces being filled only with the letter or number, if any,
designati"ng the measure).
(e) ,In accordance with Elections Code Section 9283;. printed
arguments submitted to voters in accordance with Section 92;82 of the Elections Code
shall be 'filed with the City. Clerk, accompanied by the printed name(s) and signature(s) of
the :author(s) submitting it, or if submitted on behalf of an organization the name of the
organization and the printed name and signature of at least one of its principal officers.
Arguments are due in the office of the City Clerk prior to 5:00 p.m. on Monday, August
16, 2010.
lg
i (d) The City Council may authorize, by motion, amember ormembers
to prepare a draft argument against the measure and to return-the draft for consideration
and adoption by the City Council at a duly noticed meeting of the City Council. In
accordance with Elections Code Section 9287, any council members authorized by the
City Counci to do so may sign the argument against: the measure. However, in
accordance with Elections Code Section 9283., if the argument against the measure is
signed bymore than 5 council members; only the signatures of the first five council
members to sign the ballot argument will be printed with the ballot argument.
(e) Alternatively, the City Council may authorize, by motion, a
member ormembers of the City Council to cooperate with members of the community
andlor interested parties and/or.organizations to prepare a draft argument against the
measure.
6. (a) Pursuant to Elections Code Section 9285, when the City Clerk has
selected the arguments for,and against the measure, that will be printed and distributed to
the voters; the City Clerk shall send copies of the argument in favor of the measure to the
authors of the argument against, ,and copies of the argument against to the authors of the
argument in favor. Rebuttal arguments shall be printed in the same manner as the direct
arguments. Each rebuttal argument shall immediately follow the direct argument that it
seeks to rebut.
(b) Rebuttal arguments shall riot exceed.. two hundred fifty words and
maybe signed bymore than five persons, however, only-the first five persons to sign will
be printed with the ballot measure. The persons that ign the rebuttal arguments maybe
different persons than the persons that signed the direct arguments.
(c) The last day for submission of rebuttal arguments for or against the
measure shall be by 5:00 p.m. on Thursday, August 26, 2010.
(dj All previous resolutions providing for the filing of rebuttal
arguments for City of Petaluma measures are repealed. The provisions of this resolution
concerning rebuttal. arguments shall only apply to the election to be held on November 2,
ZO'10; and following the conclusion of Ghat election are repealed.
7. n .accordance with. Elections Code Section. 9280, the City Attorney is
directed to f'le with the City Clerk by August 16, 2010, an impartial analysis of the
measure, not to exceed f ve hundred words, showing the effect of the measure.
8. T,he City of Petaluma recognizes that additional costs maybe incurred by
the County by reason of themeasure and agrees to reimburse the County for such costs.
The City Manager is hereby authorized and directed to appropriate the necessary funds to
pay for the City's cost of placing the measure on the election ballot.
9. (a) The City Clerk is directed to file a certified copy of this resolution
with the Board of Supervisors of Sonoma County and the Sonoma County Elections
Iq
Department orP or before August 5, 2010. The City Clerk is hereby authorized and
directed to take all steps. necessary to place the :measure on the ballot -and to cause the
measure attached as Exhibit A,to be ,published once iri a;newspaper of general circulation,
or any other newspaper designated as the official newspaper of the City of Petaluma, in
accordance with California Elections Code Section 12111 and California Government
Code Section 6061. A copy of the measure shall be made available to any voter upon
request. The City Clerk is authorized and. directed to give further additional notice of the
measure. in tune, -form ,and manner as required bylaw.
{b) In all particulars not recited in this resolution, the election shall be
held and conducted as provided bylaw ;for'holdngmumcipal elections.
PASSED AND ADOPTED this 14th day of September, 2009, by the following
vote:
AYES.:
NOES:
ABSENT:
ABSTP.IN:
PamelaTorliatt, Mayor
Claire Cooper, City Clerk
20
EX~II~IT A
' The, People of the `City of Petaluma do ordain as follows:
SECTION I; The rate schedule for wastewater service set forth in Resolution No. 2007-023
of the Petaluma City Council shall be reduced to ,the rates established by
Resolution No. 2002-189, which were the rates in effect on January 1, 2006.
SECTION IF: If any'provision of this°rneasure or the application thereof to any person or
circumstances is held invalid, that invalidity shall not affect other provisions
or applications, and to this end theprovisions of this measure are severable.
SECTION III: This measuremaynot be amended except-upon voter approval.
1285100.3
2-
RE'POR'T' ON PO'T'EN'T'IAL FISCAL AloTI.~ OTIIER IlVIPACTS ®F
POPOSET~ INITIA'T'IVE 'TO RET)iJCE CITY O;F PE'TALiJ1VIA
VVAS'T'EVVA'I'ER SERVICE I~A`I'ES
TO RATES IN "EFFEC'T ON JANUARY 1, 2006
Il>1 ACCORT)AI~dCE VVIT'H CALIFORI~IIA ELECTIONS CODE
SECTION 9212
1
22
Report on Potential Fiscal and Other Impacts ofProposed Initiative
to Reduce City of Petaluma Wastewater Service Rates
to Rates in Effect on January 1, 2006 •-
(Report Ordered by.Dire"cton ofthe Petaluma City Council on September 14, 2009
pursuant to California. Elections Code Section 92T2) .
-THE 2009
RATE REDiJCTYON INITIA'T'IVE
On January 7, 2009,. Petaluma received a notice of intent to :circulate a petition to qualify a ballot
initiative that would reduce City of Petaluma wastewater service rates to rates in effect on
January 1, 2006. The summary of the proposed initiative, as prepared by the City Attorney and
supplied to the. `initiative proponents, reads as follows;
Thee initiative measure would reduce the wastewater service rate: schedule established by
City of Petaluma.Resolution No. 20Q7=023., effective.February 1,..20.07, to the "rates that
were in effect on January 1,=2006 pursuant to City of Petaluma Resolution No. 2002-189.
If any provision or application of the initiative measure is.held invalid, that invalidity is
not intended. to affect any other provision or application of'the initiative measure.
The initiative .measure may not' be amended except by subsequent voter approval.
The wastewater service rates for 2007 through 2011 were adopted by City Council Resolution
No. 2007-023, which became effectiye'February 1, 2007.
The proposed.. initiative measure is a subset of Measure K, the rate reduction ballot initiative..
presented to, and :rejected by, 'Petaluma voters at the November, 2008. election. There are two
differences: between the proposed initiative measure and Measure K. Unlike Measure K, the
proposed. measure seeks only to rollback wastewater (sewer) rates, rather than. both water and
wastewater rates; and the proposed measure does not expressly limit future rates.
t
The. pletition for the proposed initiative. was circulated and signed_petfion documents filed with
the City Clerk on July 22, 2Qb9. The City Clerk certified the petition. documents as sufficient on
Se ternber 14 2Q,09: That same da the Ci Council directed Ci staff to re ort within 30~ da
P ~ y ty ~ ty P ' ~ ys
on significant potential impacts. of the initiative. The purpose of this report is to discuss
significant: potential .fiscal .and other impacts of the proposed initiative; and to provide
background .iiiforimation concerning Petaluma's wastewater utility and its financial structure to
.assist City decision makers and' members of the public in understanding, the impacts of the
proposed initiat e. •
Elections Code ;Section 92'1'2 provides that reports under that section may consider; in addition to
:fiscal impacts of a proposed initiative; a proposed initiative's effect on the internal. consistency of
the general plan, on land uses,. the. ability to meet housing needs,. funding for .infrastructure, the
vitality and `viability of~the business climate and redevelopment ,programs, and any other relevant
matters.
2
2~
PE'TALUlVIA'S WASTEWATER ~JTILITY
The wastewater :rates adopted by the City Council on January 22, .2007 under Resolution No.
2007-023' support operation and maintenance ;of a wastewater system that provides 24-hour
collection; treatment, disposal and. reuse of domestic, comrriercial and industrial wastewater
generated. by over 55,,000 residents and businesses in' Petaluma anal approximately 1,500
residents 'and busnesse_ s in the unincorporated Sonoma County community of Penngrove.
Petaluma's wastewater is collected' `through. an underground network of over 190 miles of
collection system. pipeline. A network of nine collection system pump stations .pump the
wastewater to 'the City's -.new Ellis Creek Water Recycling Facility. Treated wastewater is
released. to the Petaluma River. during the winter; and recycled during the summer for irrigation
of 700 acres of agricultural land, two golf courses and a vineyard.
Increases in Petaluma's wastewater rates were required to cover ongoing operation and
maintenance costs, to meet debt service obligations, and to fund the utility s capital improvement
program; including construction of .the Ellis Creek Water Recycling Facility, to replace the City's
.Hopper Street Wastewater Treatment Facility, the C Street Pump Station Upgrade Project,
expansion. of the recycled water program, and replacement of worn and deteriorated sewer
pipelines. 'The Hopper Street~fac~lty, which was originally constructed in 193.8, could not meet
anticipated. growth in the, community,, did not produce tertiary recycled water, could not
.consistently meet current permit requrements,t could not meet. future permit requircments,Z did
not have odor control„ and was,near :the end of'ts useful life.3 The Ellis Creek -Water Recycling
Facility was designed to accommodate growth anticipated under the City's General Plan; and to:
m Comply with Federal, State and regional air and water quality regulations;
o Protect the water quality of the Petaluma River and the San Francisco Bay by treating
wastewater `in. an'environmentally sensitive manner;
® Stabilize and treat bosoTids generated in the wastewater treatment process to EPA's
.Class B standards to permit. beneficial reuse of'the biosolids;
o Produce tertiary recycled water in accordance with California Title 22 regulations to
provide recycled water for irrigation users throughout the City; and
~ From January 2000 through Apri12004; the~City was'assessed mandatory minimum penalties totaling $162,000 for
fifty-four,permitviolationsat`the``Hopper Street facility.
Z For example; the..new'.NPDES permit includes lower Total Suspended Solids (TSS) aimits which reduce the
monthly TSS average~fiom 45 mg/L to 30 mg/L and the weekly TSS average fiom~65 mg/L to 45 mg/L, which the
Hopper Street facility could.not,meet,
s A 2001 evaluation. determined manyof the facilities at Hopper Street were not useable for long term treatment
because they lacked adequate capacity; were in very poor condition; did not meet current building standards and
would be costly to upgrade.
3
2~
'® Provide storage .in :the oxidation ponds necessary to support the recycled water program
for the period from May 1 to October 20 when discharge. to the Petaluma River is
;prohibited
Construction. of the Ellis Creek Water Recycling Facility began October 2005 and was
substantially completed. June 2009: It is now in operation and treating 4.5 million gallons of
wastewater per.. day" (mgd); and producing about 4.3 mgd of recycled water for irrigation and use
on-site.. Tertiary recycled water is used on-site :for plant, process water; .fire protection, landscape
.irrigation and toilet flushing.. As they recycled, water system expands, tertiary recycled water. will
be used for irrigation of urban areas currently dependent on drinking water, which will annually
make over 460 million gallons" of potable water supply available that would otherwise be used
for irrigation. The "plant is also producing approximately 20 tons of biosolids per day which are
being beneficially reused to construct landfill cells.
FINANCING FOR P>ETALUMA'S WASTEWATER 1(JTII~ITY
Revenue.
The City''a wastewater enterprise generates the vast majority of .its revenues from user charges.
For the year ending June 30, 2009, the enterprise generated. approximately $1"7.2 million in user
charges: User charge revenue for fiscal. year .09-10. is esti""mated to be $1.9.3 million and for fiscal
year 10-51 is estimated to be $2'1.8 million.
Expenses
Operating expenses for the wastewater utility include the cost: of salaries and benefits fore City.
staff, electricity and fuel, .operating materials; supplies and equipment;. and. biosoIids disposal and
reuse. Expenses, for operation and .maintenance. of'the storm drainage system are included in the
wastewater enterprise. A well, maintained storm drainage system benefits the wastewater system
in that if serves to keep infiltration and inflow (I&I) from the wastewater system. This reduces
sanitary sewer flows through the wastewater collection system into the treatment plant and helps
keep the sizing of sanitary ..sewers, and the treatment plant. at appropriate levels. and helps reduce
operating costs. The wastewater enterprise transfers a portion of its .revenue: to the City of
Petaluma's General' Fund to cover :its, share of administrative and., overhead costs for services
;.,
provided by the General Fund to the wastewater enterprise. such as utility billing,. ;rs_k
management and information technology. "Total operating expenses {before debt service and
interest) -for °the "year ending June 30, 20.09, are estimated at $8'.2 million. Budgeted operating
expenses during fi5cal,year~ 09-10 and fiscal year 10-11 are estimated at $11.3 million and. $.11.7
million, respectively. The increased expenses are attr'butabie to increases in "General Fund
overhead costs and the esfrnated .new costs associated with operation and maintenance of the
Ellis Creek" Water Recycling.Facilty, which began operation during fiscal year Q9-1Q. Costs for
operation ,and maintenance of the Ellis Creek Water Recycling Facility are higher than the
Hopper Street Facility 'because the Ellis Creek facility provides a higher level of wastewater
treatment than the -Hopper Street facility did.
4
25
Debt
Existing -long-term debt obligations. of the wastewater utility are summarized as follows:
® 2000 Wastewater Revenue Bonds.. These revenue bonds had a par value of $8,895,000
when issued. Annual debf service payments are about $720,000 and will continue until
2020. The outstanding balance. on the revenue bonds is $5;935,000. The .revenue bonds
were .issued to fund the Pond Influent. Pump Station Upgrade Project, the Disinfection
Facility Upgrade Prgj'ect; and planning. and environmental documentation, in support of
the. Ellis Creek Water Recycling Facility Project.
2005' State Revolving Fund Loan from the State Water Resources Control Board. The
City obtained a loan'from'the-State in 2005 for nearly $126 million at an interest rate of
2.4% to assist.in construction of the Ellis Creek Water Recycling Facility. At the end of
September 2009,, over $ l 13 million had been received by the City. Annual payments. are
estimated at nearly $7:8 million with a 20-year repayment term. Full principal and
interest-payments under the State Revolving Fund Loan commence in Apri12010.
2005 Revolving Lines of Credit. The City obtained. two revolving lines of credit in -2005
to assist with the financing of the Ellis Creek Water Recycling Facility. This "bridge
financing" was necessary because the State, .Revolving Fund loan funding was not
available until after' constructio"n of the Ellis Creek WRF began and the State Revolving
Fund loan could not be used to refund expenditures that occurred prior. to issuance of the
-loam. In addition, the :State Revolving Fund loan would not cover all the anticipated
plant expenditures (such. as expenditures for builder's' "risk insurance 'coverage, 1`aboratory
equipment; office furniture, and. telephone systems), and annual disbursements of the
SState Revolving Fund were capped at $25 million, `below the anticipated annual.
expenditures required for construction of the project.
o BNP Paribas line of credit. of $75 million. As of August 28, 2009, the City had
borrowed.. $.14:3. million against the line of credit. The interest rate is variable and
interest costs -and fees. to ,date have totaled about $364;00.0. The loan matures and
full -repayment of the'arnountborrowed is due on August 1, 2010.
o Zions First National "$ank line of credit of $25 million. As of August 28, 2009;
the City had borrowed $9.4 million against the line of credit. The interest-rate for
the .first year is fixed at 3.88% and variable thereafter. Interest" costs and fees in
Fiscal Years' 2008 and 2009 totaled about $352,000. The loan matures and full
repayment of the amount borrowed is due on August 1, 2010.
Each of the City's long-.term debt :obligations on behalf of the wastewater utility axe subject to
debt agreements containing. various terms and conditions. Summarized below are some of the
key debt. covenants intended to minimize risk of the City's creditors that are contained in the debt
agreements...
5
2e.
The 2;000 Wastewater Revenue Bonds require the City to maintain char.~es for, the wastewater
system durin°g each fiscal year which are sufficient to yield net revenues; excluding connection
fees, at least equal to one hundred percent (100%) of the wastewater enterprise debt service, and
-net revenues including connection fees at least equal to. one hundred twenty-..five percent (125%)
of the~wastewater debt service. Section 9 of Exhibit A -Scope of Work of the City's. agreement
with the State Water'Resources Control Board governing the State Revolving Fund loan_requires
the City to maintain a user charge system sufficient to meet the requirements; of Section
204(b)(1) of the federal. Clean Water Act, which, together with. its implementing :regulations,
requires development of a user charge system that generates sufficient revenue. to pay the total
operation. and maintenance :.costs necessary for the proper operation, maintenance and
replacement of treatment works, :and requires each recipient of wastewater services to pay its
proportionate share of the costs. Section 4.4 of Exhibit B -Budget. Detail and Payment
Provisions of the State Revolving Fund loan agreement further requires the. City to set rates
sufficient to yield net revenues which are equal to the debt .service of the wastewater enterprise.
This section also prohibits the, City .from reducing wastewater service rates, unless the net
revenues:, from such reduced. rates will at all times be sufficient to meet the requirements of
Section 4.4.
The City's loan agreements with lions. Bank and BNP Paribas require that the City impose
wastewater service rates and collect wastewater service rate proceeds so that net revenues of the
wastewater. enterprise,, including connection fee proceeds, equal at least 125% of the enterprise's
annual debt service obligations.
By August. 1, 2010 the City is required, to repay all amounts, borrowed against: the two lines. of
credit. Anticipated principal balances on the two lines of credit total.. about $26,676',0005. The
City has planned to .issue new' long-term debt (revenue bonds) to pay off the lines of credit by, the
time the amounts borrowed become due, as well as to obtain additional funds for planned capital
improvement projects. The City has not ,yet. begun the formal process of issuing new debt. The
wastewater enterprise''s current cash balance is budgeted -for an operations reserve and for part or
all of several capital improvements; including the C Street Pump Station Upgrade Project, the
Hopper Street Water Recycling Facility Decommissioning Project, Sewer Main Replacement
projects, and. the ,recycled water expansion program. Use of cash reserves to pay the line of
credit debt would prevent the City from establishing an adequate operating reserve and from
pursuing needed capital improvements.
Capital. Program
The wastewaterenterprise is .in the. midst of an extensive capital improvement program, which
includes construction of'the Ellis Creek Water Recycling Facility, which was completed in 2009.
a Net revenues. means the amount of all gross.charges received for, and all other gross incomeand revenues derived
by the City from, the ownership or operation of the wastewater system or otherwise .arising from the wastewater
system~during such period,. including transfers from any rate stabilization reserve accounts, less the amount of
operations and maintenance'costs.-for such.period.
s 7fii's includes an:estimafed $3 milliorr additional amount to be borrowed in completing the Ellis Creek Water
Recycling Facility construction' program.
6
Z,
i
Total rcosts for this project are estimated at $159 million. Other planned capital improvements
include:
®! The C Street Pump Station Upgrade Project, which includes flood protection (the pump
station is located. adjacent to the Petaluma River),. replacement of worn pumps, provision
of standby pumping capability (under the current operation, all pumps run during storm
events which leaves no backup should a pump failure occur}, and replacement of the
j emergency. generator.
m) The Hopper Street Wastewater Treatment Facility Demolition Project, which .includes
decommissioning of the facility and demolition of .above ground structures which are no
longer used.
e I Various system improvement projects to replace or repair deteriorated pipe, manholes
~ and pump stations.
. ~ Expansion of the water recycling system, which is a key component in the City's water
i supply plan.. .
In summary, over the next five fiscal years the City .plans to invest $23 million in non-
replacement capital projects and $29 million in replacement capital projects, for a total
investment of $52 million.
Future Debt
At present, it is anticipated that the City would issue about $29.4 million in new wastewater
revenue bonds in 2010 in order to provide net proceeds sufficient. to pay off the two lines of
credit.; Annual debt service :related to these bonds is estimated at about $2.1 million for 30 years.
In addition, at present it is anticipated that the City would issue about $21 million in new
wastewater bonds in 20 L2 to .provide needed funds for the capital improvement program.
Annual debt service related. to these bonds is estimated at about $1.5 million for 30 years.
Baseline Financial Plan
Exhibit 1, attached to this. report; presents an updated financial plan that illustrates how the
wastewater enterprise, under- currently-approved wastewater rates, meets all its obligations for
operations and maintenance, debt service and related coverage, and capital improvement
program. needs, as well as maintains prudent operating and capital program reserves...
PE'TAI,iJ1VIA WASTEWATER SERVICE RATES
Wastewater rates. for Petaluma commercial and industrial customers are based on a fixed service
charge and a commodity charge based on wastewater produced, as measured by the water meter.
Wastewater rates for Petaluma residential customers consist of a fixed service charge plus a
commodity charge based on average winter water usage. Basing the commodity charge on
average winter water usage avoids charges for water that is used for irrigation outside the
residence. This structure is more equitable than a flat wastewater charge, which is still used by
many communities, :and rewards indoor water conservation efforts. On January 22, 2007, the
Petaluma City Council adopted a utility investment program supported by annual wastewater rate
7
2~b
increases to be phased in over a;five-year'°period. The first increase. became effective: February 1,
2007.: Subsequent increases .occurred on January 1,.200.8 and January 1,'2009,. Wastewater rates
for 2009, 2010 arid. 20'11 are illustrated in Table T.
Table 1
Wastewater Rate Schedule for.2009, 2.01.0 .and' 2011,
Effective January 1 of Each Fear
T e of Char. a 2009 2010 2011
Fixed Monthly Gharge.($/month)
Single-Family Residential 1:3.14 14.85 16.7$
Multi--Unit Residential, per dwelling unit 13.14 14.85 16.78
Unmetered Residential,, per dwelling unit 63.79' 22:08 81.45
Commercial
Low-Strength 13.14 14:85 1-6.78
Medium-Strength 13.14 14;.85 16.78
High-.Strength 13..14 14.85 16.78
Metered Industrial Users 13:14 14.85 16.78
Variable charge ($%hcf)
Single=Family Residential 6.23 7.04 7,.96
'Multi-Unit Residential 6:23 7.04 7:96
Commercial
Low-Strength ~ 6.20 7.01 7.92
1Vledium-Strength 7.38 8.34 9.42
Hugh-Strength 9.55 10.79 12.19
Metered Industrial Users
Flow ($/hcf) 4.62 5.22 5.90
BOD ($/lb) 0.45 0.51 0:57
TSS ($/lb) 0.49 0:55 0.63
The average wintertime water usage for a single family residential customer is approximately 8
hundred cubic feet, (hcf) per month (1 hcf = 74$ gallons}. Therefore the average single family
wastewater bill in 2009 is $62:98 per month, calculated as follows:
Fixed monthly charge = $13.14
Usage charge = $6.23Lhcf
Monthly wastewaterbill = $13.14 + ($6.23/hcf x 8hcf) = $`62.98
A .comparison of`the :2:009 monthly wastewater bill for single family residential customers using
S hcfper month in the nine Sonoma County cities is provided in Figure 1.
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25
Figure 1
Estimated 1Vlonthly Year. 2009 Wastewater Bill
For Average Single. Family Residential Customer
X90:00
I
~suoo
$'0 ~00
$60:00
X50,'00
$-10:00
X30,00
X20.00
$1'O.UQ
~0~00'
c 2
tb~1 Q~i~ ~oF ~~°~° `J~a a~°~ 4°~~ ~,~40 °~,~ti
I G~°~c " 4~ `?~ Via`' 4~~~ '~~a ~ ~e~~a G
f
Figure- 1 is provided to illustrate how Petaluma's wastewater rates compare to other Sonoma
.County cities. There are significant differences between the agencies. For example, Petaluma''s-
and I~ealdsburg''s rates'. support construction and operation of new wastewater treatment plants;
which were constructed, to: replace: antiquated facilities and meet' increasingly stringent.-water
quality regulations„.and :are designed to produce tertiary treated water. The cities of Sebastopol,
Santa Rosa, Cotah, sand .Rohnert Park are part of the City of Santa Rosa's Laguna Subregional
System. Rohnert_ Park'`s rate reflects a wastewater initiative that passed in 200& and reduced the
average single family :residential' wastewater bill by $19.62 per month.
The proposed initiative, would reduce Petaluma's wastewater rates to those in effect on January
1, 2006. These rates,are illustrated in Table 2.
9
30
Table Z
Wastewater Rate Schedule for January 2006'
I
The average single family residential
calculated as follows:
'I' a of Char a Rate
Fixed Monthly Charge ($/month)
Single-Family Residential $9.11
Multi-Unit-Residential, :per dwelling unit $9..11
Unmetered:Residential, per dwelling unit $44.21
Commercial
Low-Strength $9.11
Medium-Strength $9.11
High=Strength $9:11
Metered Industrial Users $9.11
Variable charge ($/hcf)
Single-Family Residential $4.3.19
Multi=Unit Residential $4.319_
Commercial
Low-Strength- $4.298
Medium-Strength $5..11.3
'I=Iigh-Strength $6.6.1.6
Metered Industrial Users
-Flow ($/hcf) ' $3.:202
BOD ($/lb) $0.311
TSS ($/lb) - $0:340
customer's: wastewater billwould be $43.66/month
Fixed monthly charge = $9.11
Usage charge = $4.319/hcf
Monthly wastewater bill = $9.11 + ($4:319Zhcf.x 8hcf) _ $43.66
A comparison of the monthl~y'wastewater bill for' single family residential customers in Petaluma
if the proposed wastewater initiative passes with the eight other Sonoma County cities is
provided in Figure 2:, .
10
3~
Figure 2
Estimated 1Vlonthly Wastewater Bi1T For Average Single Family Petaluma Residential
Customer if the Proposed Wastewater Rate Rollback Initiative Passes
(fear 201`1 Rate for Petaluma, Year 200912ates For Other Cities).
~_
~?O.AO
~b0.Q0
$5U.00~
~~u.ou
~3o.aa
~zo.oo
~ro.oo
$0.00
1c, ~i. «~ • ~.
~e{~~ ~~~~~~ ~~,~~ Go~o~+ ~~~o~~ ~~a~o{ 405 ~~~t4O GQ,~~
~,~.
i~
I Q~
As shown in Figure 2, Petaluma' rates would be the second lowest in the County, lower than
Rohnert Park's .rates, which were changed due to a Similar wastewater ..initiative i .200.8. It'
important:to note that the "Petaluma~Inifiative" rate shown inFigure Z is a Year 2011 rate,
whereas the, rates.. for°the: other .cities are 2009 rates. It is likely that some or :all of the other cities
will raise~their rates `in`the next two years.
11
32
IMPACTS OF THE PR®POSEL) INITIATIVE
Significant potential impacts of the proposed initiative, if approved by the voters, are discussed
below.
1. The proposed initiative may be invalid. The proposed initiative may impair existing
contract obligations of the wastewater enterprise, including. the bond and loan contract
obligations described above, in violation of the contract clauses in the California and U.S.
Constitutions. For example, if the proposed initiative takes effect, the City will be unable
to satisfy the ratios of.enterprise revenue to debt that are required by the 2000' Wastewater
Revenue- Bonds, the State Revolving, Fund loan, and the lines of credit with lions Bank and
BNP Paribas,. discussed above. This can also be seen in Exhibits 1 and 2 to this report,
which compare Petaluma's wastewater enterprise finances without the proposed initiative
(Exhibit 1 - Baseline) with the proposed initiative's impact on wastewater enterprise
finances (Exhibit. 2). If the proposed initiative takes effect, it will also violate the
.prohibition against rate reductions in the State Revolving Fund loan; also discussed above.
Exhibit 2 to this report also shows that the proposed initiative, if 'approved, would result in
wastewater service rates insufficient to pay the debt, service on the State Revolving Fund
loan, in violation of Section 4.4 of the loan agreement.
1
The proposed initiative may also .impermissibly impair other essential government powers,
and impermissibly interfere with the City Council's fiscal responsibilities and ability under
state .law and the Petaluma 1Vlunicipal Code to set wastewater service charges at levels
adequate to fund operating, capital, and debt costs of the City's wastewater 'enterprise. If
the validity of the proposed initiative measure is litigated, the wastewater enterprise (and
the ratepayers) may incur significant litigation expense.
The proposed initiative may also impermissibly conflict with statutory and regulatory
requirements. that apply to the .City's wastewater enterprise: For example, the rates
~mposed by the proposed initiative would be insufficient to satisfy requirements for sewer
revenue bonds, including the requirements in California Health and' .Safety .Code Section .
5040 that. sewer rates be set "...sufficient in each.. year for the payment of the proper and
reasonable expenses of .operation,, repair, replacement, and maintenance of the works
[wastewater facilities], and for ,payment of the principal of and the interest of the bonds."
If t_he proposed 'initiative. takes effect, it would probably also violate the requirements of .
CalfomiaState Water :Resources Control Board Order No. 2006=003 (Statewide General
Waste Discharge ;Requirements for Sanitary Sewer Systems). Provision 9 of Order No.
'2006=003 re:quires;Petaluma to ,allocate adequate resources for the operation, maintenance,
and xepair of its sanitary sewer system, by establishing a, proper rate. structure. It can be
seen in Exhibit 2 to this; report, that the proposed initiative: would prevent Petaluma from
adequately funding sanitary sewer system operation, maintenance and.repair. As discussed
above, the State Revolving Fund ;agreement also requires the City to maintain a user charge
system sufficient to meet~the requirements of Section 204(b)(1) ofthe federal Clean Water
Act, which, together with its 'implementing. regulations, requires development of a user
charge system that generates sufficient revenue to pay the tofal• operation and maintenance
costs necessary for the proper operation, maintenance and replacement of treatment. works,
12
33
and ,requires each recipient of wastewater services to pay ifs proportionate share of the
costs. As can be seen from Exhibit 2 to this report, the= rates that: would be imposed under
the proposed initiative would violate the Clean Water Act requirements:
2. The- reduction, in revenue created. by the proposed initiative would negatively impact
operation and maintenance of~fhe wastewater utility.
Exhibit 2, attached to .this report, presents a financial impact assessment of the proposed
initiative that illustrates how the wastewater enterprise, under reduced wastewater rates,
will be unable to meet its obligations for operation and' maintenance, debt service and
related coverage; and capital improvement program needs, as well as maintain prudent
operating and capital program reserves. Specific adverse impacts include:
2.1 Even prior to the ;2010 election the proposed initiative may be a "reportable
event" with.. negative effects on the City's Revolving Credit Agreements with Zions
Bank and BNP Paribas and 'the State Revolving 1•-+'und,.Loan, and' Petaluma's credit
r' sting generally. Once 'the initiative has been certified and placed on the ballot, the City
may be required by terms of its existing loan agreements to notify its lenders of the
potential material adverse effects on the City's fiscal condition. This can affect the City's
credit with these lenders and potentially affect other sources 'of debt financing. Negative
impact. on the City's credit due to the proposed initiative could preclude or make more
costly issuance of additional debt to repay the lines of credit, which become due on August
1.0, 2010.
2.2 The proposed .initiative :may prevent the City from .making payments to Zions
First National Bank and BIVP Paribas that are due on August 1, 2010 under the City's
Revolving Credit Agreements. As of the 'end of August 2009, the total amount borrowed
under both lines of credit of'the sewer enterprise's about $23;575;000. Approximately $3
'million more from these .lines of credit may be needed to fully complete the Ellis Creek
facility. Current estimates indicate that the wastewater enterprise may be at least $8
million short of funds to repay the lines of credit (assuming all reserve wastewater
enterprise funds are applied to pay the line of credit debt, regardless of'the uses for which
such reserve funds .are currently earmarked). If the City is unable to secure funds to repay
the line of credit debt when -it matures on August 10, 2010, and defaults on one or both of
she fines of credit, -that default will :have to be reported to the. State Water Resources
Control Board,. under the terms of the .State Revolving Loar Agreement:. This may affect
the City's credit and the City's obligations under the State Revolving Loan fund agreement.
2.3 The proposed. initiative could cause the City to default. on its State Revolving
Fund Ioan. Starting in April, 2010, annual principal and interest payments estimated at
$7.8 .million dollars per .year will be due on the State Revolving ,Fund Loan. As can be
seen, in Exhibit 2 to this report, without adequate revenue from wastewater service charges,
the -City may be unable to ;pay the debt service on the; State Revolving Fund loan and would
be in default on the loan, absent General Fund or other revenues to make up the estimated
$1~6 million shortfall that would exist by the end of .fiscal. year 10-11. A default could
result in loss of any remaining; undisbursed loan funding;. enforcement action by the State
on the. loan; litigation between the State and the City, and negative impacts on the City's
13
3`~
credit rating. A default would also impact the State Revolving'Fund loan program's ability
to fund other projects, as it ..relies on installment payments to fund other projects. If
.Petaluma General Fund :revenue were diverted, to make the State Revolving Fund
payments, it would reduce the General Fund and. reduce General Fund-supported services
accordingly.
2.4 The proposed initiative could cause the City to default on. outstanding wastewater
revenue bonds, beginning with the payment due on May 1, 2011. Without ad"equate
revenue :from wastewater' charges, the .City :may be unable to pay the debt service on the
wastewater .revenue bonds: that were issued. and sold in 2000,, and would. also be in default
bn covenant,,obligatons. The annual bond payment is about $720,000:. As can be seen
from Exhibit 2 :to thin report, if the wastewater enterprise fund exhausts enterprise reserve
funds to repay the .lines of credit and/or make the State Revolving Fund loan payments,
there may not. be sufficient cash for the bond payment.. A default 'could result in loss of
loan funding;. other City liability; financial exposure ,arising out of litigation by the City's
bondholders, negative impacts on the City's credit rating, and inability to secure future. debt
funding. Downgrading the City's ,credit rating would make future borrowing more
expensive, if it is available.. In the event of default,~the bond Trustee may declare the bond
principal .immediately due and payable. The Trustee may also pursue any available remedy
at .law or in equity to enforce the outstanding bond payments.
2.5 The proposed initiative could delay or cause cancellation. of other wastewater
projects .funded by wastewater charges, and prevent the City from maintaining
eastewater service levels, .complying with applicable regulatory- requirements and
protecting the public health and safety. As can be seen_ from. Exhbt~2 to this .report, if
the proposed initiative taken effect, the City would have. to cut back .on operations,
.:maintenance and/or service levels to keep expenses- in balance with the lower revenue
tream,particularly if reserve funds must be used to meet debt obligations. It also-may be
necessary :for the City :to :reduce or ,eliminate capital replacement and .rehabilitation
programs to maintain facility operations. Delayed, or cancelled replacement of City sewer
pipelines,. ,pump stations, treatment facilities or recycled 'water' facilities could result in
failure of these facilities and place: the City in violation of its .National Pollutant Discharge
Elimination System (NPDES) permits for operation of the wastewater collection system,.
the .recycled water system,.. and the wastewater treatment system. Failure of these facilities.
could cause. environmental damage, increase risks to public health, and degrade th_e
Petaluma River's'Water quality. Such failures could also result in imposition of'significant
'State water quality fines..
3. The proposed initiative could compromise the City's ability to treat its wastewater
and` result` `fir 'a. State: uioraYorium on new sewer connec"tions. If wastewater system
operations are- impacted to a significant degree by reduced :revenue imposed :by the
proposed initiative, the City's ability to treat the community' wastewater could. be
compromised: If State regulators determine that a consent order is necessary, the State
could impose a moratorium on new connections. State regulatory=review and monitoring
of,Petaluma wastewater-utilities would also probably increase.
14
3S
but also the
4. 'li'he proposed !iiitiative w,o,uld impact not only the wastewater enterprise;
rest of the City's financial structure, including City and. Petaluma Community
Development Commission debt=funded projects. The, potential.. impacts. of the proposed
' ~ ' ' y rp ' to the City's financial structure as
a wholee Forlexample; bf the public f nance rat ng agencies lower the City wastewaterbond
r~atn s to Tri Ie ;B from the current A Minus; the credit ratings of the City and Petaluma
g P
Community Development Commission (the City's redevelopment agency) would be placed
on credit watch. That would result in higher interest rates for debt issued by the: City or the
Petaluma Community Development Commission. -Higher interest rates would reduce
.funding available .for, projects listed in the ,Petaluma Community Development
Commission's Five Year Implementation Plan, which relies. on an additional $45 million of
bond financing. Affected projects would include infrastructure improvements. such as
street work, major cross=town. connectors .and interchanges such as Rainier and. Old
Redwood Highway, and construction of updated. City fire and police. headquarters
b~,uildings. Reduction of redevelopment project funding may in turn reduce other revenue
to the .City from. ongoing: tax increment growth: Projects that `could be funded by General
Fund debt, such as the East ,Washington ball fields, could be similarly affected. A
significant decrease in the City's credit rating could make debt funding unavailable; even at
higher interest rates.
5. The proposed initiative could result in a $10 ,million annual, deficit in the .wastewater
utility, potentially impacting other City. finances and services: If the proposed initiative
takes effect; the City's wastewater fund revenue would be unable to support any debt
service without impairing ongoing operations and minimal aystem rehabilitation and
replacement. Exhibit. 2, at the end of this report,. shows the `cumulative impact of annual
deficits over the next several years. The information for `fiscal year 10-11 -is complicated
by the. obligation to repay the fines of credit, as well .as showing reduced wastewater rates
for a partial year.. Information for fiscal year 11-12 is more reflective of a steady state
environment if wastewater rates .are reduced. At that. time; annual revenues are estimated
to be about $12:7 million. Annual operating expenses are estimated to total. about $12.0
million at that time: Minimal system replacement: and .rehabilitation is estimated. at about
$1.6 million at that. time: Finally, annual debt service (on the SRF loan. and 2000
wastewater.revenue bonds) .total about $8.5 million per year:- .Annual expenses in these
three areas exceed the available revenue by $10 million6. A deficit on this order or
magnitude' would` persist until revenues were re-established to close this gap.
6. The `propposed initiative could result in insolvency of the Cty'f insuff cient funds are
available from: other sources to replace lost watea- and sewer revenues .and maintain
essential ;services. To obtain. protection from creditors and continue .operating its
wastewater utility; the: City could be required to seek bankruptcy ,protection, incur .related
expenses and suffer negative impacts on the City credit rating and the City's ability to issue
debt'and. otherwise fund City operations.
6 A cash shortfall in fscal year 10=1,1 is estimated at about $16 million after using all available cash reserves to pay
off the lines of credit and meet;other debt obligations. Only a prudent operating reserve would remain in the
wastewater utility..
15
3~
7. 'Y'he proposed in`itafive could prevent the implementation of recycled water programs
that: are necessary under General Plan.. 2025 to provide a current. and future water
supply to Petaluma's citizens. Goal 8-G-3 of the City's General Plan 2025 requires the
City to maximize the use of recycled water as a potable water offset to manage water
demands and meet regulatory requirements for wastewater discharge. As can be seen from
Exhibit 2. to this report,, reduced wastewater revenues due to the proposed initiative would
eliminate funding for the Water Recycling Expansion .Program which is essential to
provide the ,potable water offset.that'makes up a 1'arge part of the City's future water supply,
as determined by the City's adopted General Plan. 2025.. Therefore, the proposed initiative
would threaten the City's ability to provide for existing, and future water supply needs of .its
citizens, in .addition .to threatening the City's ability to provide adequate levels of
wastewater service and operation.
8. 'The proposed initiative will cause reduction in wastewater operating revenues which
..may interfere with General Plan 'Goals, Programs ardd Policies for management of the
recycled: wastewater- program under General Plan Goal 8-G-4. Goal 8-G-4 requires
the ..City to manage the- wastewater collection -and treatment. ystem to address '100%
`capture. and treatment of the City's wastewater in an .economically and ecologically sound
manner: Policies and: Programs under this Goal. include '8-P-LS, requiring capacity of the
waste treatment ;facility to be maintained and expanded as needed to keep pace with
growth; B-P-15:A, requiring implementation of an adopted waste treatment facility master
plan and construction of distribution improvements through development conditions of
approval. (which presumes sufficient distribution infrastructure to bring recycled water to
such. development); and. several other programs- which require a stable revenue base to
permit ongoing maintenance, periodic replacement of system infrastructure and necessary
improvements. To the extent-that revenue shortfalls identified in Exhibit 2 to this report
limit the :ability of the C_ ity to fulfill. this .goal and implement the adopted policies and
programs, the proposed initiative will create inconsistencies with General Plan 2025.
9. 'The proposed initiative will impair the City's ability to meet General Plan Mousing
dement Goals: The City adopted an updated .Housing Element 2009-2014 on June 15,
2009. Goal 1 requires the: City to provide adequate residential. opportunities to
.accommodate projected' residential. growth and facilitate mobility within the ownership and
rental markets. Goal 2 requires the City to promote a range of housing types to meet the
:housing needs of all Petalumans. Goal, 3 requires the ~ City to minimize constraints on
;housing development to expedite construction and lower development costs. Other
.Housing Element goals speak to creation and preservation of affordable and special needs
housing, with, attention to eliminating constraints on .such development. Programs 3.8 and
3.9 under Goal 3 estate that the City will actively participate in. the Sonoma .County Water
Agency's ;projects to increase the capacity of the City's. water supply system and reinforce
its water distribution system. However, very recent actions by the Sonoma County Water
Agericy suggest :that the water agency may be unwilling to seek and provide additional
irriported.'water -for Petaluma. Therefore, the General Plan 2025 water supply programs
which depend on use ,of recycled water for potable offset are critical to providing water and
wastewater services for development sufficient to meet. the City's .housing goals, some of
which are mandated by ABAG regional housing allocatipns and state Department of
16
31
Housing Community beveloprnent:requirements. To the extent. that fhe proposed initiative
prevents or curtails City recycled water programs, the City' ability to meet its Housing
.Element goals will be: unpaired.
10. ')('he proposed' initiative wills impair the City's ability to meet General Plan Goa19-G-1,
Economic I~ealth and Sustainability. Goal 9-G-1 and the Policies and Programs
identified to implement it deal with establishing a diverse and sustainable local economy.
Without adequate rate=based funding to maintain capacity and .operational capability of the
wastewater system, :and. the continued implementation of recycled water/potable water
offset ,programs: as an essential component of future water supply, the City will not be able
to attract the types of new business essential to fiscal health or to .adequately serve
residents. Policies 9-P-6(A), (B) .and (C) recognize. that adequate City revenue is essential
too sustain public services :and infrastructure needed to serve the residential, commercial and
industrial activities necessary for a balanced and. vibrant local economy. Impaired recycled
water infrastructure funding .resulting 'from the proposed initiative would be inconsistent
with these goals.
11. The proposed initiative could cause cancellation. or reduction. of public access and
educational activities at the- EIIis Creek Wastewater Recycling Facility. Without
adequate revenue from wastewater charges, in order to preserve. basic wastewater
operations, the City could be ,required to reduce or cancel. programs at the waste treatment
facility which .are intended to protect. the environment and provide public access and
education regarding; the Ellis Creek open space and public amenities: This would create an
I
inconsistency with General Plan 2025 Policy 8-P-17:, "Maintain and expand public access
and educational .opportunities at the Ellis Creek Water Recycling Facility."
13059117.1
17
3`~
,. __ .
Exhibit l
?
i
_....
_ _
: :.
City, of Petaluma: -- Wastewater`Utili
..
ty
i
. ....
E
;
_.
...
Multi-Year Financial Plan ~ i Baseline Analysis
it '
_, ......., FY 08-09 ~
., . _, FY 09-10 ~ _ FY 30-,I1
_ . ,. FY 11-12 I
_._~- . f-
- FY'12-13
-- FY 13-14
~ Pro edion ( Bud et i Estimate Estimate .Estimate Estimate
1 Wastewater Rate Increases Calendar Year > ~
1
13:0% _ 13 D% . 3 5%~ 3:5%: 3 5%
~ ~
' WASTEWATER OPERATING FUND ~ ~ ~ { ~
2
..
Beg~nning,Balance j
_. -
18,007,716
24 231,968
8,513,547
6}819,547. ~
6 545,747 ? _
5,314,347
i t
Revenues } i
~
3 Charges for Sales ;• 17,220,139 ~ 19250 000 21 806 000 23,6.55,000 ~ 24,665,000 ZS 771,000
4 Charges fdr Recycled Wtr. Sales , 20,000; 21 000. 22;000 23;000 ~ 24,000
5 Charges for Services 4,085 11,700 12;000 12,000: 12,000: 12,000
6 Gran[/Debt Proceeds 16,582,082. ; 26;672,000
7 Open Space District 850,000
8 Capacity Charges 289',907
9 Ottier Revenue 44,938 42,490: 44,000 46;000: 48,000 50 000
10 Investment Earnings
_:. ; 360,000
_ 485,000. 213,000
_ 205;000: 229,000: 213,000
11 Total Revenues
, 34,501 151 ' 47,331,190 22,096,000: 23,940,000 24,977,
0
00 ~ 26,070,000
! _
Expenditures and; Transfers ,'
_. _ : ,
`,'
..
? _
.
12 Wastewater.Administration ~ 4,060,108 913,650; 944,000 ' 979 000 1 017,000 1 059,000
13 IndustnaLPretreatment • t
.
. - 73 346
_ 346,950 ! 359000_ 372 000 _
' .386 000 402 000
14 3
_.~ _
Wastewater Storm Drains ~
_ _. _ ~ .._.
..
724,713 ( _
_.
730~3D0 _
7SS 000 '
_
783,000
813,000 i _
846 000
15 Collecd6n System 796 085 # 1 555,934 ~ 1 608 000: 1 667 000. ~ 1 732,000 1 1 603 000
16 Reclamatioh _._ ~ 763 174
y 956340 ~ 988 000 1 024x000 ,_ 1x0641000 w_• _ 1 107 000
_
1T Customer Servos ~ _
49 178 i 96;150 } -~
99 000' Y03,000 i 107,000 ? 111000
18 General Fund Ovh Transfer ~ 647 200 1 135;000
ti 1 173 000 1,216 000 + 1,263,000 ~ 1 315 000
19 Treatment I. 1 084 767 % 5 543,700 } 5 728,000 5,938 000 ~ 6,168,000 ' 6 420,000
20 Debt Serv. - 2000 WW'eonds ' 716 704.
_ 718,374. s 724,000 '
- 722 000 725,000 726 000
21 Debt Serv. - SWRCB$RFLoan _
.._ _ e ~..
~ ~ ~ _I
I
.. 7 777633 i
_ 7 778,000:
.... 7,778,000 i
... ... . 7,778;000 } 7,778 000
22 Revolving Lines of Gred_it 716 013 27,275,581 ~ - - ! - -
23 Debt Serv. - 2010 WW Bonds - 2,134,000 2,131,800 ~ 2,138;400 ' 2,133,200
24 Debt Serv. - 2012 W W Bonds - ~ - -
! j 1,517;000 ~ 1 52,1,400
.
25 Capital Projects ; _
14,257,382 , , , _
26 Transfer to Capital Fund ;
.. 16,000,000 j 1,500,000. 1,500 000 1,500,000 1,500,000
27
' Total Expenditures
~
- 23,890,670
' : 63,049;611
~ 23,790,000
.- 24',213,800
.. . y 26,208,400 ~
- 26,721,600
28 _. ..
•Endl g Balance ! 28 618 19T 8;513 547 i 6 819 547 6 545 747: 5 314347 4,662 747
29 Operating Reserve (33%u df O&M) ~ 2;706,000 3;722;000 ~ 3,846,000 3;987,000 4}142,000: 4,311,000
30 Rate Stabilization Reserve 4,000,000 1 1 500,000 ; - - -
31
Uncommitted Balance
~ ...
21,912,197 ~
3,291 547 ~
2 973,547
2,558,747 f
1 172
,347.
351,747
32 _ _,
DS Coverage (w/o Conn._Fees) 1.0 min _ ~ 4 18 1.26 1 19 1 17 j _
1.11 1.12
!. 33 DS Coverage (w/ Conn: Fees) 1'.25 mm. i 4.38 1.28 ~ 1 31 1.34 1.30 i 1.36
WASTEWATER CAPITAL FUND ~ ~ I
34
. Beg/nnmg Balance ~,
.. ~ _ - 8,502,000 5,361 000 17,422,000 ~ 2 680,000
L Revenues 1
._
35
Capacity Charges ; _..
200,000 } ..
1 274 000. _ _
1,767 000 ;.
2 297,000 '
Z 867.000
36 Transfer from Operating Fund ' 16,000,000 1 500,000 1,500 000 { 1 500,000 1 500,000
37 Grant/Debt-.Proceeds { 4,150,000 19,000 000 '
38 Investment Earrings ; , - r 213,000 161 000 610,000 107,000
39 Total Revenues
~ ~
~ 20;350,000 ',
~ ~ 2,987;000 22,428,000 4,407;0.00: 4,474,000
Expenditures ~
40
Recycled Water Projects .. .,
~
_, _, ,.
41 Phase 2B Recycled Wtr. Pipe 8e Reservoir 100;000 3,231 000 ` 3,775,000
42 Phase 2A Recycled Water Pipelihe ; 50,000 1 450,000 _ 1 631 000 ;. _ „_„ _ ,__ ,,,. _ ._ .. _,_,_ .,
43 Phase 3 Recycled WaterPipelire
.. i 1,276,000 ~ 2,632,000 .3,137,000
._ ..
44 .
Recycled Water Pump Station 2 Improv.: ! 545,000 ;:
;, 45 Recycled Water Pump Station 1 Improv { ,
.-. . -_ ~ _ • 600 000 ' i _
46 Recycled Water Maln Pump Station Improv i c 570.000
Wastewater Protects ~ ~ i j
47
on Upgrade
C Street Pump Stab
__ .
1 000 000 #
_
2 378,000
f
'
48 Demo of Hopper St. W W Trtmt Fadl. i 100;000 ~ 310,000 770 000
! 10 683,000
49 (
Water Recycling Facility -Ellis Creek ~ 7 620;000 1,286 000 ;
_ .
I.
.
5D j
SCADA Ellis Creek WRF ( 4781000
51 Wilmmgtiin Pump Station ~ ~ ~ 60,000 ' 165 000 751'000 j
52
53
Oxidation Pond Levee Remfo
Sewer Main Re Iacement,201 emen[ )
p -0 Vanous _ ;
~ ~ 50 000 ~
815,000 590 000
265;000_
45 000 i
55,000 '
_._....
865;000
54 Victoria Pump Sta[ion Generator ` ? 160,000
55 Manhole RehabiliCation 260,000 l 260,000: 418 000 ' 418;000: 528;000
56 Lift Station Upgrade., 450,000 175,000 395,000 € 135,000 ' , 135,000
57 Total Expenditures 11,648,000 '. 6;108,000: 10;387,000: 19,149,000 ; 4,665,000
58 Capital Reserve 8;502 000 5;381,000 17"422,000 2,680 000 ;- 2;489 000
ig
3g
Exhibit 2
~ : City of Petaluma -- Wastewater Utility
~
i ' Multi-Year Financial Plan Initiative Impact Analysis
_ _FY 08-09 F
Y-09 10 FY SO-11 ; FY_11;-12 FY 12-13 FY 13-14
_ Projection _
t
Budget
Estimate
Estimate
Estimate
Estimate
1 Wastewater Rate~Increases (Calendar Year) --> -:' 13.0%{ -38.7%i 0.0%I 0.0%: 0.0°k
i WASTEWATER~OPERATINGFUND `. ~
' 2 Beginning Balance 18,007,716 ~ 24,231,968 i
_ 18,714,000 I (12,429,000): (21,897,000); (32,162,000}
3
Revenues
Charges for Sales
•,~ ~
17 220,139 i ~
19 250 000
16 514 000
12 580000 i
12 580 000
12580 000
4
~ Chargesfor Recycled Wtr Sales. j 20 000 • 21,000 22000 23,000 1 24 000
5 Charges for Services __„ ._ W _-,_ m
__.. ____ 4x089 ; 11 700 i 12 000.
... 12,000
__.__ ~ 12 000 ~
- --~ ~~-~ ___ ,_ 12 000.
6 , ,_
.
Grant/Debt Proceetls 16 582 082
1 ~- . _.... `,
I
_.
7
...
Open Space'Dlstnct
d _..._
... . -..1
850,000 i _
.
.
8 i. Capacity Charges . _, _._ _... _._. __ ...._..289907 i Y t _. _..
_ ..__ ._
~
9 Other Revenue
_ - - 44,938:
. _ 42490 44}000.; 45,000 46,000 , 47,000
10 Investment Eamings ' 360,000! 485,000 468;000 - ! -
11 Total Revenues 34 501,151 206659,190 17;059,000
.. 12 659,000 12,661,000.
_ 12,663,000
Expenditures and Transfers
12 Wastewater Adm~nisfration 4 060,108 , . 913 650 94A,000 972,000 1_,001,000 1,031,000
13 Industrial Pretreatment 73,346 346 950 359,000 ! 37D 000 381,000 __ 392 000
14 WasEewaterStor•m Drains 724,713 730,300 755,000 778,000 ! 801,000 825,000
15 Collection System: 798,085 1,555'934 1.608;000: 1 656;000 1 706,000 1757,000
i6 Reclamation 763,174: 956,340 i 966,000 1,018,000 - S,D49,000 , _ 1,060,000
17 _
Customer Service _
49,178:
96 160 - -.
99,000 s
102,000:
105,000 i
308,000
18 General Fund Ovh Tra_ nsfer !
- 647,200. 1,135,000 ~ 1,173,000:
;- 1,208,000 1,244,000 1,281,000
19 Treatment ,_ _ 1 084,7fi7 ', 5,543,700 ' 5,728,000: 5 900,000: 6 077,000 ' 6,259,000
20 -
Debt Serv. - 2000 WW Bonds
716 7D4
I
718 374 -
724 000
722 000:
725 000
`
726 000
21 I Debt Serv. - SWRCB SRF Loan 7 777 633 _ 7 778,000 7 778000 7 778x000
_ __ 7 776000
22 Revolving Lines of Credit
- - -- 716,013 600 000 26,676,000 - -
_ -
--
' 23 Debt Serv. - 2010 WW Bonds
-
..
- ~
-
-
_. ... t
- _ 1..
24 Deb[Serv -2012 WW Bonds
c
a -
1 r - - - -
25 pital Proje
ts
C 4,257,382 ;
26 Transfer to Capital Fund ; 5,803 000 d 1,370,000 1 623;000: 2 059,000 1,526,000
27 ... ....
Total Expenditures.
23,890;670
26,177-030
48,202;000
22,127,000 '
22,926,000 ~
22,765,000
'; 28 Ending Balance '
. 28,618,197 18,714,000 ~' (12,429,000); (21,897,D00) (32;162,000)? (42,264,000)
29 -.
..
Opera[ing.Reserve (33% of O&M)
2,706,000
-
3,722;000
3,846,000 !
3,961,000
_
4,060,000:
_
4,202,000
___
30 Rate Stabilization Reserve 4,000;000: 1,500,000 - ,
- - -
31 Uncommitted Balance ~ ; 21,912,197 ~ 13,492,000 _ (16,275,000) (25,858,000), (36,242,000); (46,466,000)
32 DS Coverage (w/o Conn..Fees), 1.O,min. 4.18 ' 1.26: 0.21: 0.13 0.09: O.Os
33 DS Coverage (w/ Conn Fees) 1 25:mih. 4.38 i 1,28 i 0 21 0.13 0.09 ~ 0 05
WASTEWATER CAPITAL FUND
,
34 Beginning Balance , - y - - - ,
f Revenues
~ ~
.
_ _.
_
- .~
...... .
- - -
_
~~ 351 Capacity ,Charges
. _ I 200 000 j ; _
: _
36 Transferfrom Operating Fund _
- - ~ 5,803,000 ~
- -- .1,370_,000 i 1 623,000 ' 2,059,000 1,528 000_
__ 37
38 I Grant/Debt Proceeds ,~
Investment Eamings_ _ ,.~
i 4L15D~000~
-
-'--__~
_...... I
.._.._____
I
39 4 . _ .
Total Revenues , .
y
10,153000 ~
1,370 000
1,623,000 .'
2,059,000 '
1,528,000
I Expenditures i i
40 Recycled WatenPro)ects _.
_ _
41
Phase 26 Recycled Wtr.:Pipe & Reservoir _.
~ .
+
42 Phase 2A Recycled Water Pipeline ?
43 Phase 3 Recycled Water-Pipeline;
~
~ ~
44 Recycled WaterPUmpStation2`Improv. ~ ~~
45
Recycled WateP~Pump Station~l~.~Improv.
~ .
_
46 ~ Recycled WaterMain Pump Statlon.tmprov. '
~
'~ Wastewater Projects. ~ ~ ~ _ ~
~
47 C Street Pump Station Upgrade
48 Demo. of"Hopper St.~WW Trtmt;Facil. ~ 100'000 ~ ,
.
. 49 acilityi- Ellis Creek.
Water Recycling F ; 7,820,000 -
,
50
SCADA EII(s;CreekWRF
~
478,000 _
51 VJIImlhgton,,PumpStatlon ~_
~ ~ ; ~ 60,000 ~ 165,000 ~_~ 751,000
82 , Oxidation Pond Levee Remforcemenf.
,.._..._
' _
_
~~ _ 50 000
_.._~ 590 D00
..._.~~
_.._.__ :
. _. _. j.
53 , Replacement 2010 Various
Sewer Main
_ 815000 ; 265,000 645;000: 755,000 ; 865,000
_..
_.
54 Victoria Pump Station'Generatoc } 160,000 ~ _
55 Manhole Rehabih[abon' _ i 280 000 k 280,000 ! 418,000 418-000 i 528 000
56 Uft Station Upgrade: ': ', 450,000 ~
_ i. 175,OD0 .395,000:
_ - 135,000 i 135 000
-
57 Total Expenditures (
.. '
.. , 10,153000 f 1,370-,000: 1,623000 2 059,000 ~ 1,528,000
58' Ending Balance - -
19
40