Exh 7F
- AGENDA ITEM #7F
r.~ SEPTEMBER 9, 2002
P. ,~_
CITY OF ATLANTIC BEACH
+~ CITY COMMISSION MEETING
i STAFF REPORT
~* AGENDA ITEM: Ordinance No. 80-02-65 Amending Chapter 22, Article IV, Storm
Water Management Division, Division 2, Rates and Charges,
. ~; Section 22-335 Fees, to adopt a new Storm Water Utility Fee of
~+ , $4.00 per ERU •per month.
SUBMITTED BY: Nelson Van Liere, Finance Director
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DATE: August 30, 2002
~'"' BACKGROUND:. For a number of years, the City has been. funding the Storm Water
F ~ Utility system partially with user fees, but primarily from either
General Fund operating revenues or gas tax proceeds. In an effort
°~"? to work towards fully recovering the total cost of operating the
utility with user fees, the City is proposing a $1.00. per ERU per
month rate increase. The projected expenses of the utility are now
over one million dollars and the current $3.00 charge only
generates about $269,000. The proposed increase will generate an
estimated additional $89,877 in revenues for the up-coming fiscal
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year.
BUDGET: The proposed operating budget for fiscal year 2003 does include
this additional revenue as part of the funding of the operation.
N ; RECOMMENDATION: Adopt Ordinance No. 80-02-65 changing the ERU monthly
rate from $3.00 to $4.00.
ATTACHMENTS: Ordinance No. 80-02-65
Storm Water Utility Revenue Sufficiency Analysis
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` REVIEWED BY CITY MANA
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AGENDA ITEM #7F
,,,~, SEPTEMBER 9, 2002
ORDINANCE N0.80-02-65
,.a AN ORDINANCE OF THE CITY OF ATLANTIC BEACH,
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:; FLORIDA INCREASING THE MONTHLY STORM WATER
, UTILITY FEE BY AMENDING CHAPTER TWENTY TWO,
UTILITIES ARTICLE IV STORM WATER MANAGEMENT,
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DIVISION 2 RATES AND CHARGES, SECTION 22-335. FEES;
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PROVIDING FOR INTENT; PROVIDING FOR THE ADOPTION.
A** OF A NEW RATE; PROVIDING FOR SEVERABILITY;
k PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the cost of maintaining the storm water utility system has risen
,,, dramatically since the utility was created; and
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WHEREAS, the .long term goal of the City is to some day recover the entire cost of the
- storm water utility system through user fees; and
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WHEREAS, the current rate of $3.00 per ERU per month is insufficient to recover
those costs, and
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WHEREAS, the City Commission of the City of Atlantic Beach, Florida desires to
adopt a higher monthly fee per ERU for storm water utility operations,
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NOW THEREFORE, BE IT ENACTED BY THE CITY COMMISSION ON
BEHALF OF THE PEOPLE OF THE CITY. OF ATLANTIC BEACH, FLORIDA:
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SECTION 1. Intent
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It is the intent of the City of Atlantic Beach Florida to raise the- monthly~fee for
storm water utility services from $3.00 to $4.00 per equivalent residential unit
., (ER ~.
SECTION 2. Section 22-335 Fees; is amended as follows:
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Sec. 22-335. Fees.
(a) ERU rate. The fee per ERU billing unit shall be ~°° ~'°"~-° ~Q2 nm four
` ' dollars $4.00) per month.
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~; SECTION 3. SEVERABILITY
~, The provisions of this ordinance aze declared to be severable and if any section,
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sentence, clause or phrase of this ordinance shall, for any reason, be held to be
... invalid or unconstitutional, such decision shall not affect the validity of the
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r..~ AGENDA ITEM #7F
SEPTEMBER 9, 2002
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ORDINANCE NO. 80-02-65
`' CITY OF ATLANTIC BEACH
PAGE TWO
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s ' remaining sections, sentences, clauses and phrases of this ordinance, but the same
shall remain in effect, it being the legislative intent that this ordinance shall stand
4. notwithstanding the invalidity of any part.
SECTION 4. REPEALER
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All ordinances in conflict herewith are, to the extent of such conflict, hereby
~,,, repealed.
SECTION 5. EFFECTIVE DATE.
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This ordinance shaIl take effect immediately upon its passage by the City
Commission of the City of Aflantic Beach, Florida.
Passed by the City Commission on first reading this day of September
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2002.
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Passed by the City Commission on second reading this day of September
2002.
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~* John S. Meserve
t ' Mayor /Presiding Officer
~^°^. Approved as to Form and Correctness
. ~ Alan C. Jensen, Esquire.
City Attorney
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,,~ ATTEST:
Maureen King, CMC
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4 ,: City Clerk
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AGENDA ITEM #7F
SEPTEMBER 9, 2002
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City of Atlantic Beach..
Revenue ~uffciency Analysis
Storm Water Utility Fund
Purpose: The object of this analysis is to highlight the issue of storm water utility
fees in relation to the programmed expenses related to providing that service.
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Background: As of Fiscal Year 2001, all estimated costs for providing storm water
~,, related services including maintenance; debt service and small local projects have been
~ captured iri'one place. The costs of maintenance of the storm water collection system
t ' have previously been recorded in the General Fund, where the crews that do the
maintenance have been budgeted. Now that the costs have been accumulated in one
place, comparing that total with the revenues generated, if is clear that the fees do not
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begin to recover the cost. As a result, funding for this program. is heavily subsidized from
the General Fund and the Gas Tax fund:
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Revenue and Cost Comparison: Below is a table showing the estimated revenues
~* with existing rates, increased rate as proposed and total costs expressed in terms of a rate
that would be necessary to pay for that service.
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Revenues Dollars Dollars er ERU
From Existing Rates $269,63.1 $3.00
From $1/ERU increase $89,877 $1.00
Total Bud eted Revenues $359,508 $4.00
Ex eases
Personal Services $250,209 .$2.79
Operating Expenses $382,639 $4.29
Ca italOutla $40,000 $.45
Debt Service $331,148 $3.69
Total Ex eases: $1,003,996 $11.17
Amount of subsidized costs $644,488 $7,17
Summary: As you can see from the table above, the Storm Water Utility would
require an $11.17 per ERU rate to recover 100% of the estimated costs. This cost
analysis is based on the proposed budget for FY-2003 without any funding for the Storm
~* Water Master Plan.
Recommendation: For this budget and future budgets; the City needs to do all
~^ possible to m;n;m;~e costs and. determine if it is our intent to recover all costs with fees,
or continue with the subsidy. Currently there is more subsidy than revenues generated
from rates. The increased level of service of the storm water maintenance program
~^ competes directly for General Fund and Gas Tax Fund revenues and should be evaluated
with street maintenance, and all other General Fund program expenditures in mind.