At the council’s May 4 meeting, its members voted unanimously to have the city’s consultant, Willdan Financial Services, move forward with completing the draft report to be brought back in June.
That report will delve more deeply into a scenario for instituting water rate adjustments as needed to fund operating and capital expenditures with debt, with separate annual increases for the wastewater system.
“The reality is that there is really no good time to increase rates,” said city Finance Director Nick Walker, adding that the costs of utility services are always changing.
The last rate study was in 2012, with the final rate increase from it implemented in 2017, Walker said.
In January, the council authorized the agreement with Willdan for the study. Since that time, Walker said he, Utilities Superintendent Paul Harris and City Manager Kevin Ingram have been working closely with the consultants on the potential costs.
Chris Fisher of Willdan said the last rate study resulted in a $21 increase in sewer and $17.40 for water services over a five-year period.
In 2016, the city issued $3.2 million in bonds that allowed for the purchase of Green Ranch, where the city’s water wells are located, as well as recoating of storage tanks and replacement of meters citywide, Fisher said.
Fisher shared a combined bill comparison that showed Lakeport’s water and sewer existing rates, based on 6,000 gallons of water a month, averaged $127.34 per month.
The presentation looked at four scenarios. The one the council ultimately chose to pursue included a proposed rate increase in the first year of 8 percent for water and 2 percent for sewer that would bring the monthly total average to $135.80 based on the same usage assumptions as the current average bill.
The current and proposed monthly rates are higher than Cloverdale, Esparto, Kelseyville and north Lakeport but lower than Ukiah, Hidden Valley Lake, Healdsburg, Calistoga and St. Helena, Fisher said. The average monthly bill for all of those communities is $143.29.
Fisher said the plan would increase the average monthly bill from $127.34 currently to $155.50 by 2026, or about $28 per month.
For water, the initial two years of increases in 2022 and 2023 would be 8 percent each, with increases of 2.5 percent annually through 2026. For sewer, it would be a 2-percent yearly increase over five years.
There are several more steps in the process, including completing the report to the council, setting a public hearing date, mailing out Proposition 218 notices 45 days before the public hearing, and adoption and implementation of the rates.
The council ultimately reached consensus to move forward with the proposed rate increase scenario, which the report will more fully detail.
Also at the May 4 meeting, the council presented a proclamation recognizing May 9 to 15 as Police Week.
Chief Brad Rasmussen thanked the council members and said he and his department appreciate their support. Council members, in turn, praised Rasmussen and his officers for their efforts.
The council also received a presentation by Pacific Gas and Electric about its Community Wildfire Safety Program and approved a memorandum of understanding between the city and the Lakeport Main Street Association for the period of July 1, 2021, through June 30, 2022, at a cost of $20,000.
Councilmembers gave their consent to a waiver request from Gary Cox of GAC Co. for accrued interest in the amount of $9,041.57 for the parcel located at 2403 Hartley St. in exchange for the full payment of the parcel’s base assessment in escrow and denied a reduction in the AB1600 water expansion fee for that same parcel.
The council also approved a resolution for an allocation of $10 million in funding and the execution of a grant agreement and any amendments from the Community Development Block Grant — Disaster Relief as well as a resolution authorizing the city manager to sign the statement of assurances and submit an application for the State Community Development Block Grant Coronavirus Aid, Relief, and Economic Security Act, Rounds 2 and 3 for $146,394.
At the request of Public Works Director Doug Grider, the council voted to terminate the construction contract with AFelix General Engineering, Inc. dba WestPac Construction under Section 6-5 of the contract’s standard specifications, and award a $725,000 construction contract for the 2021 Sewer Main Rehabilitation Project to Ghilotti Construction.