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Our meeting. So 330, we'll call our meeting to order the Regional Suits Program Policy Committee meeting for Thursday, March 6th, 2025. All right. We'll call please, Jennifer. Some of you member, captain. Here. So many member, do you pray? Here, here. Some of you member, dors, parada. And many member, Velta.

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Vice Chair president. Vice Chair President. Vice Chair.

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Chair-rotters. And committee member Elai.

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Elai, president. Playing the role of VALT other day.

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All right. Very good. Speaking of,

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let's ask Bill to leave this in the pledge of allegiance.

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All right. Please stand, basic flag. Place your hand over your heart, which is in the middle of your

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chest. Ready, begin.

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Okay,

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next up are public comments. Jennifer, do we have any public comments that have come to you?

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No, I did not receive any public comments. I do see a couple of colors on the line.

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So if you would like to provide public comment, please press star six.

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So online star six, if you wish to make a public comment.

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Looks like no one's on meeting themselves.

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Okay, then we'll move on from public comments.

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Let's move on to our technical committee report and Ron Greg.

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Happy to hear from you.

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Happy to be here and join all this free water.

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Right. We'll take it.

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We need it.

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we need it.

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So Chairman Rogers, members of the committee, we held our Technical Advisory Committee

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for February, last Thursday. All of the member agencies were represented in some fashion or

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another. The first item we had was an oral presentation by Ken and his team, and it represented

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a significant decrease in events that had to be addressed from the from the previous

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month. So that was good. And some explanation of a certain quality issue that took place

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at Prado Park. So we got some good information and feedback on that. So we appreciated that

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information from Ken. On the information items, Randy Lee provided us an update on the rates.

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We know that's a very current topic.

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The presentation we received was from a timing standpoint, was really just the schedule

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and outlining the process that we're going to be going through.

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Later on that day, the preliminary information on the rates was going to be circulated and

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available to all the staff, representatives and interested parties, Randy sent out an email,

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providing us all a link so we could see the draft presentation for the board workshop that

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was going to take place yesterday. And he indicated that the information will come back to

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to the Tech Committee next month, well it's the end of this month for a formal presentation

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to tax, so we anticipate that. We also received an update on the RP-5 expansion project from

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Brian and this was focused specifically on the cost of the project and the relationship

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in the progress of the schedule. So there was good information there. We are going to have some

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additional feedback based on a couple of questions that came out of TAC, and I expect to get that

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at this month's meeting. Beyond that was receiving file items, the draft agenda for this committee's

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meeting, and the Bar subcommittee report as well was included. That's all I have, unless there are any

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questions. Questions from anybody with Ron having to do with tech. The tech committee. Okay. Thank you. All right. Thank you. Appreciate it. Ron.

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All right. Next. Next up is our next item having to do with our minutes from February. Anybody make corrections? Have any corrections? If not.

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not proved. We have a motion.

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Second. All in favor? Aye. Opposed? Okay. Abstentions. Then, so it's unanimous. Next up, informational

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items, let's start with Brian. He looks like he's teeing up on the RP-5 expansion project

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in a PowerPoint presentation. Thank you, sir. Thank you. Good afternoon. This is a follow-up

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from our last presentation and request for explanation of follow up on the project.

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First was schedule.

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The schedule update were about 83% through the full project completion.

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As we see here on the schedule, we show several of the main facilities in their anticipated completion

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dates.

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Right now, as we look at it, the contractor is running late with the project and those completion dates which are originally scheduled.

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Down below in the table, we have the contractor designer and construction management firms associated with the project and their percent payments with their contracts.

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So WM Liles, for their total contract of 341 million currently, is about 84% paid.

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The designer persons is about 92% paid.

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Construction management from Arcadeus is about 65% paid just to bring up.

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We did recently approve an amendment to Arcadeus's contract to continue construction management services to match the schedule provided by the contractor.

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So that's why that one dropped is to 65 percent.

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Overall, the project budget in schedule, just as a high level summary.

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Design services were about $25.9 million total.

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You have the services there, Parsons, as well as other design services, construction services.

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Those are the professional services persons during the construction, our construction management

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services by Arcadeus as well as some of the other construction related is about 51.9 million.

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Construction total is running about 64 million with our value for WMLIs for construction, the

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original bid price of 329 million. Our change orders to date is about 11 million. We have a remaining contingency of about 21.9 million. And then we also have the radio tower project, which is a separate sub project that's executed by a design build entity to build a radio tower on our site for 1.4 million.

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And so bringing in that total project cost up to about $442 million out of our $450 million budget.

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One of the other things that we bring and update our board on a fairly regular basis is our

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change orders. As we talked about them on the prior slide, but this is a little more diving down into

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to that. We have our original contract amount, our change orders that have been executed,

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our 11, about 11 million, and that has been 456 individual change orders. Our request

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for deviations, so that is the step before it becomes a change. That is where we negotiate

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and work with the contractor and the designer to make sure that if we're implementing a change

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that we have the right scope, the right price, and everything. That's where we work with

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to come up with it and we come to agreement before it is put into a change order and made

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a change to the contract. Right now we're tracking about $1.4 million worth of changes in

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there. That number can still go down. So that is why our change order total then adds up to a

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potential change order total of $12.5 million. That runs about 3.79% change orders on this project

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And it eats into that contingency of 37.9%.

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When we break down those types of changes, we track that as well.

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We have it into four main buckets, design errors and omissions,

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requests by the district, changes in site condition,

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and requested by contractor.

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Design errors and omissions, those are things that were either left out of the

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scope of the project and had it be added to make the system complete.

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or things that were constructed and then had to be changed to make it complete and make the system work.

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So we have about 6.7 million and you see the percentage of the total changes as well as the contract.

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Request by district, those are some changes that the district request as we go along we see that we need

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Something added to the project, either to make it more serviceable, or make it a longer life, or something that was unanticipated that we needed added. That is 4.2 million. A large majority of that ended up being an HTTP liners at the front of the project. One manufacturer that's pretty common in the industry went out of business during design. And we weren't finding a usual embedded

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And so we had to go with a different one during construction.

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So that was a large percentage of that.

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Changes in site conditions, those typically.

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A lot of those are when we are installing underground and we come across something that was unanticipated.

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That's where the utility is not in the location we expected to be either horizontally or vertically.

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So then we have to reroute other utilities or do something different in the construction and compensate the contractor for that.

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And then the request by the contractor, typically these are value engineering or cost saving ideas or changes that result in a credit to the agency.

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And it's about $800,000 on this project.

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And with that, that ends my follow-up. Any other questions?

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on the utilities. Are there actually utilities? Are we just referring to the agency's pipes and conduits?

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No, it's agency pipes and conduits. We just generically refer to them as utilities.

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Second, I notice as the archaedist, the change order, I heard that you're kind of behind scale.

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was that that change order based upon them being on site longer than they planned to be?

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Oh, the amendment to our fatuses? Yeah, and that is a result of supporting the agency

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because the contractors taking longer than anticipated. Is there, do you look at any penalties

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happening to or that to recover those costs or what caused the delay or have you spoken to those?

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Yeah, we are always analyzing and reviewing that with the contractor and make sure we have

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up, maintain all of our contractual obligations as well as rights to recoup, cost if need

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to be.

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So I'm at that point though, but I'm as in like any contract, such a large contract, you're

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going to hold so much back in reserves until there are things checked out.

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Maybe even a year after it's finished, just to make sure everything works or sometime.

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So, as a standard course of business, we have a retention with every payment of about 5%.

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Okay.

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So, that retention is held in an escrow account jointly with the contractor.

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That's an option they have under the contract.

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We have to sign off in a release of funds that has not been released.

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And then we do monthly estimates with the contractor.

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They're tracking their monthly progression based on their schedule as well as installed.

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So we're very tightly watching how much we're paying make sure we're only paying for what work is installed. Thank you

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And there is there are a whole backs in certain time periods of when they do get that retention and it all is predicated on things working

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Thanks Brian. Well, yeah, Brian. Thank you very thorough. Um is when you have a contract with this magnitude is there normally a

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This type of change their percentages you anticipate

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Is there, are we below that percentage?

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It's kind of like, I would say the industry standard.

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Obviously, it's something that's big.

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There's going to be some changes based on just timing, times,

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and like you said, vendors go out of business, digging.

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You find something new.

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We've not been able to call it a rock charge.

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So, is that pretty standard, or is there a standard that we consider?

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So, this course of business, the agency.

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we always have a contingency in typically it's about 10% of the construction costs.

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Okay, that's good. You're at 3.799, which is excellent.

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Thank you.

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Yeah, going back to the schedule again. So it looks like the construction ends January of 26th.

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And then there is a second phase construction, WML construction.

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And that ends November of 26th, the way it looks like it.

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and then the operations of the RP-5,

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the operations of the treating plants and all that.

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What does that start?

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Does that start in 26 in phases?

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Yeah, it really starts in phases.

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And those are the bars down below.

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So if you see, let me see if I can get a pointer up here.

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I know we had a presentation last minute about it, but.

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No, no, it's a good question.

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So we are working on an operating treatment plant

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on in the treatment plant has two sides to it basically there is the

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Operating side that is the liquid's portion of treatment. And then there will be the brand new side which is a solid side that replaces RP2. So on this graph, the blue bars are typically depicting the liquid side treatment in major parts of it. And then the brown bars are the solid side. So as we see their construction, they do modifications to the aeration basins and blowers. Those are a major milestone. They get that up and running. That allows us then to start up the MBR.

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And then once they get that MBR up and running, that takes all the flow of the plant and we can decommission some things and we can jump back in and modify our other aeration base and as well as then build the other phase of the MBR system.

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So it is a sequenced phasing.

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this is there's a lot of other steps involved in processes, but these are the main ones on that

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side of the project. Those are all systems that go in and phases to maintain operation of the

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plant. The solid side is all brand new, so it is not supporting a process right now, so

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that's why you see these all are kind of constructed concurrently with this. But of course,

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to put it on. All of it has to work, particularly being dewatering. You can't start bringing

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insolids in processing unless you have a way to get it out. So, that's why dewatering

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system comes online first. Thicketing in digesters kind of come on concurrently because that is

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our feed source for the digesters when we cut over. Okay, so sounds like then the major portions

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of operations could begin late 26 to amread in this time.

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We should be starting rolling up into a lot of start up

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during 2025 and then it'll fall in.

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Okay, so later we'll see.

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Okay, yeah.

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Good.

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Thank you.

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All right, cool.

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Anybody else?

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No, I just want to note, we'll note that you have stayed

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within that viewpoint for some of the kind of cost

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so we appreciate that.

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Thank you.

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Yeah, welcome.

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Anybody else?

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Good.

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All right, Brian.

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Thank you.

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a great report.

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Next up, item B, which is regional sewer connection fee examples with

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the PowerPoint. And we have Ken. Amanda, are you part of this also?

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Okay. And Nicole. All right. So kick it off with Ken.

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Ken, do you mind if I just make a comment before?

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Absolutely. Thank you. Chair Rogers and members of the policy

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I'm really pleased to introduce this item because it reflects the way we all work together within the wastewater collection and treatment operation of IUA.

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This is a joint presentation where Ken has been graciously supported by a couple of our sewering agencies to provide this.

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And this is a model that we'd love to continue as we talk about more about how we operate our wastewater system.

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So I just wanted to say thanks to Amanda and Nicole for participating with us.

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Thanks, Ken.

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Thanks for watching.

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You stole my preamble, there's your budget.

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I know I did.

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Yeah, thanks.

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Say again, thank you to Amanda Coker and Nicole Demoad for joining me on this presentation today.

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So you won't have to listen to me the entire time.

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So, before we start on the examples, this was jointly prepared by the three of us.

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We wanted to cover a couple of topics prior to the examples.

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So the first topic that we'll talk about a little bit is the Building Activity Report,

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Subcommittee, and you heard Ron mention that in the Tech Committee report.

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I'll also talk a little bit about the Exhibit J, which is the Regional Suer Connection

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fee document that governs how we calculate the sewer connection fees, then we'll jump

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into the examples for the sewer connection fee calculations, and then we'll end with monthly

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building activity reporting. So, before, like I mentioned, before jumping into the connection

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fee examples, I wanted to highlight a very important group that's near and dear to my heart.

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It's called the Building Activity Report Subcommittee, and so this subcommittee is made up of representatives

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from all of the sewer collection agencies as well as IEWA staff.

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And the purpose of this subcommittee really is to ensure that we have region-wide consistency and also collaboration

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in calculating the IEWA sewer connection fees and also the monthly sewer use fees as well.

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Because those fees are actually by the regional contract and ordinance are collected by the sewer collection agencies on behalf of IEWA.

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So another important thing to note, all of the recommendations and work that we do at

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the Bar subcommittee is routed up to the regional technical committee for their review and approval.

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So just a little bit more background about

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The subcommittee, this is actually the second rendition of the Barr subcommittee. The Regional Tech Committee in 2012 did establish this committee to look at Exhibit J to streamline that back in 2012. That version of the group still made up of sewer collection agency representatives, as well as IUA staff. We did work to streamline that document Exhibit J and then in 2013 we did disband that group. During the Regional Contract Negotiations, several years ago it was agreed by all negotiations.

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parties that it was important for us and beneficial to the region to reestablish this group.

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And so that's why we have the forum again today.

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On the screen, I wanted to highlight a couple of other items that the subcommittee is actually

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working on that are very important.

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The first one is the uniform reporting forms.

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So actually just this past technical committee, or might have been the previous technical committee,

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The Tech Committee did approve the work for the subcommittee to come up with these uniform

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calculation forms that are going to be used throughout the region for calculating the connection fees

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for commercial and industrial facilities. So the subcommittee is also working on looking at the

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monthly sewer billing procedures as well. And a couple other key topics I wanted to highlight for

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the policy committee relates to the flow and loading studies as well as the re-evaluation of

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that EDU equation.

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The, we have two studies that IUA has embarked on.

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We had a regional return to sewer study,

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which was focused on wastewater monitoring

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and flow for our regional area,

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which was completed late last year.

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And then the other one is the state-wide study

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that IUA has been participating in.

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The purposes of these flow and loading studies

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is really to gather that real institute data

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to be able to update our equation.

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The IUA team did notify the Bars of Committee

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just this past Tuesday, that statewide study,

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which we often call the CASA study.

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The draft final report has been released

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to the participating agencies.

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So there's 12 other agencies, including IUA,

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that's participating in this study since 2018.

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So because the reports under attorney-client privilege

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for the time being IUA will be reviewing

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those that report. The once the report is finalized, hopefully by the end of this month,

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we will then distribute that information to the bars of the committee and then at that

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point in time we can work to evaluate the EDU equation. So with that,

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so I've been talking a little bit about Exhibit J, so I wanted to cover that a little bit more

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before handing it over to my compatriots here to describe some of those examples.

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So Exhibit J is actually part of the regional contract and ordinance.

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It was adopted in 1984 and then again, like I mentioned before, most recently amended

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in 2013.

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So it is a key document because it does describe how we calculate these sewer connection fees

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for the regional sewer system.

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So, Exhibit J defines the IUA billing unit measure, which is called the EDU equation.

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So, the denominators there and the directory, you're right, it's a math problem really

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on the screen there.

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The denominators there are what's to be the assumed flow and loading into the sewer system

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for a single family residence.

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So, in this case, 200s, yeah.

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I think we've learned about this in UHTR, yeah, it's up haven't turned right.

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Thank you, anybody else?

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Checking.

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Anyone else fancy calculators to do it out?

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Why don't you look like Calvin White for the BOD and the FST Department?

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Obviously, Randall understands it.

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Well, it's from operator tests, so that was fine.

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That's all it's, yeah, thank you, direct read, I'll explain the denominators there.

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So the BOD and the TSS are considered the loading that's going into the treatment plan.

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And then these numbers here on the board right here, 270, that's assumed to be what flows

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from a single family resident into the sewer system.

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And then 230, 220 BOD and TSS, that's the loading parameters.

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And it's important to note there's also some decimals and there's some fractional decimal numbers and so that that number represents in the equation the proportional costs for the wastewater treatment for each of those components.

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So, yeah, so it's biochemical oxygen demand and then four.

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Suspend, it's all right.

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And so one of the things that I mentioned earlier about that flow and loading study is these numbers are from the 1980s and when we talk with the other 13 or 12 agencies that we work with, their numbers are about the same are very, very similar. And so this is why it's important that those flow and loading numbers come in and then we work together to re-evaluate the equation because that will shift how these costs are

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distributed. In addition to identifying the EDU equation, we also define how and when we

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collect the fees for the sewer connection fees. So in this case, it would be for any new connections

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or change in use. And it also defines specifically how we collect those fees for these three categories

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residential, commercial, and industrial. And the last thing I'd want to, you

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know, if you're going to do this to me, you might as well help me.

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Let me start council member Doris Prada. This is an equation to come up with how we we establish our operations and the rate.

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So, it's not necessarily if one city or one searing agency adjusts it that it would go down.

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We would need the entire region over a period of time to have reductions in this area.

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But what we are seeing globally or regionally, not just in our service area, but throughout

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the southwest, is a reduction of water going down the sewer and an increase of these constituents

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there.

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There was an increased concentration.

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Exactly, and that changes the way we operate.

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So ultimately, what Ken's trying to do through this working group that will ultimately,

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once we get it out of the statewide legal discussion, and then we'll work with the Bar subcommittee,

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is to reestablish what those broad assumptions would be to establish those flow and concentration

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numbers to make planning decisions, including rate recommendations.

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So it's not something we can just do on a local level.

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Ultimately, we're getting hit as you know very well with conservation guidelines that are reducing that amount of water.

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So this is our effort to come up to more current standards when it comes to calculating what the impacts would be to us.

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Can anything you want to add to that?

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No, I think so.

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So real quick.

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Shavaj, you said reduced the amount of water going into the sewer.

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Correct.

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How?

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What would do?

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How could you reduce the water going into the sewer?

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Shorter showers.

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Less fleshing.

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Don't serious.

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But you're still using the same amount of shampoo.

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Not not.

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Not overflow.

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Rain.

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None of that.

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Other water gets involved.

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No.

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We in our area don't have combined sores.

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Our job working with the collection agencies is to ensure that only sewage goes down those pipes.

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pipes. We still have a significant amount of infiltration. So in heavy or more intense

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precipitation events, our staff gets mobilized. We've got to make sure that we don't violate

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any permits, essentially, that we don't spill out of our plants or our sewer pipes. But

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that's really a collective effort by not only the seven agencies to shore up their collection

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system. So none of the agencies are opening manholes and letting flood flows go down because

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that could impact our ability to treat and handle those flows downstream. So moving forward,

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as population increases, how then are you going to continue? You can't reduce it when it's

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going to be increasing just by people.

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The amount of sewage will increase with more development,

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but we're focused on the concentration in this calculation. So we will have more flow,

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but overall we'll have less water compared to the constituents that are also going down the

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sewers and drains. How does that happen?

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If you have more, how do you end up with less?

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Well, let me say it's kind of like instead of a three-gallon flush, not to 1.2-gallon flush.

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So, in other words, the ammonia concentration is higher because there's less water

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that are traveling with the products going down.

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I want to, I can give an example of Mary Melto.

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Let me just cut to Randy's comment there.

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That's not accurate because even if you reduce the one to 1.2,

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it's a double flush.

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People will flush more.

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The last one. It's just to mine several lot of people. So how, I mean, what are you going to eventually end up having to do? What is a long-term plan then? Let's say we get a million more people here with potential.

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I've got to unpack that question a bit mayor, but let me start with the first, which is 20 years ago. One person would flush the toilet once five gallons would go down and it would be one person's waste going out today. We have 1.6 gallon toilet.

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Let's even even with your correct assumption that sometimes it takes two flushes that's still less than the five gallons, but it's still one person doing that. So overall, you can increase the amount of people you have in the area, but the amount of water per person is getting less per person.

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But those solids and the other constituents that are going down is not changing.

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So, we're reducing the solvent basically, we're reducing the amount of liquids that are going down and increasing the amount of solids.

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That's the challenge that we're facing.

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So, with these updated calculations, not only from a planning standpoint, but ultimately, we need to know how much treatment capacity to have.

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So, if we have a million people today in 25 compared to a million people 25 years ago, the makeup of that wastewater is very different.

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There will be more flow, but it will be more complex to the solids than what would move the solids.

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What would move the solids with less liquid?

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There's still enough liquids to move that through the sewer systems.

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All right.

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I understand.

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I got better understanding how the flow is.

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You're right.

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But if you're just talking about moving it down, that your rupture will be right.

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It becomes a challenge for those people who clean the lines because you're right.

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there's less flow. So now you're starting to find areas where now clogs are happening and things

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like that. So that's that's a different challenge. Okay. Okay. Just trying to get the whole thing.

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That's all basically understanding. Okay. Thank you.

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I'm a much better person now than understand how the ship blows.

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Yeah. The only the only other thing I have on this I just mentioned to and I think I mentioned

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in the last presentation a couple of months ago is that the connection fee here that we're going to

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to talk about the Nicole and Amanda are going to walk through some examples.

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That's for the IEWA connection fee.

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So the rest of your agencies also have a fee that's separate to that.

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So with that, I think I'm going to hand it over to Nicole now and

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share, um, walk you through the first examples here for residential.

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So Nicole.

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Good afternoon, Paul.

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Good afternoon, policy committee members.

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My name is Nicole Demoet and I'm with the City of Upland.

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We're going to start with a, oh, what are they?

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Are we moving?

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Sorry, I'm putting things down.

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The three categories that we had mentioned that we would discuss with you today are residential commercial and industrial.

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We'll go ahead and start with the benchmark of sewer connection fees. That's our residential, our residential sewer connection fee.

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The benchmark of the residential fee is that the structure is designed for the purpose

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of providing permanent housing for one family or tenant.

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That's considered to be an EDU or an equivalent dwelling unit.

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So that's where sewer connection fees are ultimately based on.

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That is the lowest-strength waste water, has the lowest loading, the wastewater associated

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with single-family residences and also included in residential sewer connection fees are multi-family

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residences. Those are apartments, townhomes, condominiums. We're seeing a lot more of the

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increased and intensified development in fill development in the multi-family residences.

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We also have under this category the accessory dwelling units are aid use that's kind of been an interesting topic I've heard brought up a few times here at the policy committee and as well at the technical committee.

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These accessory dwelling units, there's actually two types of aid use.

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there is the accessory dwelling unit which is a detached residential structure that's typically added

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to an existing single family home or there's the attached JADU that's the junior accessory

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dwelling unit that is typically an add-on for example a garage conversion of smaller it's typically

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800 or so square feet that's added on to the single family home structure.

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Again, ADU's are not considered new development. The fees are due if fees are due, however, if an ADU is built concurrently with a single-family home. So there are residential developments that they're constructing a single-family home but detached accessory dwelling unit on the parcel as well. So in that case, that would be too, you'd use for that parcel. Fees can only be

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charged, however, based on the burden of an accessory dwelling unit.

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So if you'll recall, the fee structure, as Ken had mentioned, is based on flow and

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loading, and that burden to the POTW, the publicly-owned treatment plant.

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Our governing document, as Ken mentioned, is Exhibit J. That document has the legal authority

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in the regional sewer contract, that breaks down the burden of sewer user categories for appropriate connection fees.

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The Building Activity Report Subcommittee, the Bar Subcommittee, reviews the collection, and that's something that Ken had discussed.

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The next type of sewer connection fee that we're presenting today for discussion is commercial fees, those are based on drainage fixture units.

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The structure of this fee basis is that it's designed for the purpose of providing permanent housing for enterprises engaged in the exchange of goods and services.

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This can include private businesses, real estate offices, small retail stores, restaurants.

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This is inclusive of full service and fast-food establishments, warehouses, so smaller office structure with extremely large storage areas, and public facilities, your government buildings, your churches, your offices, your churches.

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Connection fees here are calculated with the sewer loading factors based on the EDU equation

401
00:37:13,260 --> 00:37:23,080
similar to what Ken had showed on the basis is sewer factors, examples of which are for the

402
00:37:23,080 --> 00:37:27,360
sewer factors of the different categories within because they would J. Examples of some of those

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categories are noted above. The private businesses, the restaurants, there's a full service restaurant

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category. There's also a different category for fast food. There is a difference in a lot of the fast

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food restaurant coming fixtures that are inclusive of fast food restaurant versus a full service

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restaurant and warehouses. Again, what you're going to see with a warehouse is you're going to see

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very small office or very small office component, but large storage components.

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So you'll see very few restrooms, very few drainage fixtures inside a warehouse.

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However, you'll see large square footage.

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And then let's see, sorry, I can't read this.

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the sewer contracting agencies, typically what occurs is we are individual plan check staff at our regional contracting agencies will review plumbing plans that are submitted to us.

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And we will count the drainage fixture units in the plumbing plan to determine the number of fixture units based on the building on the plumbing code.

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and we will use that drainage fixture unit calculation.

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I'll show you on the next slide here.

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We have the next slide here is a typical example

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of a commercial connection fee process that we do.

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Here you have a copy on the left of a typical waste

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and vent plumbing plan, so a plumbing plan that's submitted for review to a plan check staff.

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On the right-hand side, you see the capital capacity fee worksheet.

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This is the worksheet that was developed collaboratively by all of the contracting agencies in the Bar subcommittee.

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This is an excellent review tool that we're able to utilize when we go through

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and plan check, a submitted plumbing plan to determine our capital capacity so we're

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connection fee that we are charging our users.

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All agencies, as is developed at this, can I-

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The motion fee worksheet was developed collaboratively. All agencies did have a chance to provide input on the form. The goal here was standardizing the information that we're required to provide to Inland Empire Utilities Agency for our monthly report. It's positive for everybody if the expectations that we have are the same across the board for submittal. We're requested to submit all of the same information.

426
00:40:30,500 --> 00:40:33,240
Amanda, we have you up next.

427
00:40:33,400 --> 00:40:36,400
You're going to provide an explanation of our industrial.

428
00:40:36,880 --> 00:40:40,420
Can actually thank you, Nicole.

429
00:40:41,360 --> 00:40:43,680
All right, so we're on to industrial.

430
00:40:44,360 --> 00:40:53,860
So, Nicole just described to you how commercial projects are the EDU calculation works for those are more generalized.

431
00:40:54,380 --> 00:40:58,860
According to the type of business, you can't really do that with industrial customers.

432
00:40:58,860 --> 00:41:00,380
They're all so different.

433
00:41:01,560 --> 00:41:08,580
So we have to do the calculation individually for each individual industrial customer and can

434
00:41:08,580 --> 00:41:16,740
do a great job going over the equation. So I will not do that again. So thank you very much.

435
00:41:16,740 --> 00:41:25,020
Appreciate it. You're welcome. So we have an example here for you and the interesting thing about

436
00:41:25,020 --> 00:41:30,560
the industrial customer calculation is that we have two pieces of it. We have the industrial

437
00:41:30,560 --> 00:41:35,740
discharge piece and then we have the domestic wastewater piece and that piece is calculated

438
00:41:36,240 --> 00:41:42,480
very similar to how a commercial is calculated. So first we'll go over how you calculate the industrial

439
00:41:42,480 --> 00:41:48,840
discharge part and that's very simple. As long as you have your data points, your flow, your BOD

440
00:41:48,840 --> 00:41:54,600
and your TSS, you take those numbers and you just plug them into the formula and you calculate that

441
00:41:54,600 --> 00:42:01,280
And in this specific example, we come out with EDU 14.88, then you move on to your domestic

442
00:42:01,280 --> 00:42:06,900
wastewater calculation, which is looking at you're doing your drainage fixture unit counts

443
00:42:06,900 --> 00:42:13,080
again, looking at your restrooms, kitchen and break room, counting those all up. In this example,

444
00:42:13,140 --> 00:42:21,420
we have 14.5. And then that adds on to your total site EDU, which in this example is 15.95.

445
00:42:21,420 --> 00:42:33,300
So that does it for a discussion on how each of the methodologies for the calculations.

446
00:42:33,640 --> 00:42:40,300
So now I'm going to go into how the contracting agency is actually report the connection fees to IUA.

447
00:42:40,740 --> 00:42:46,440
So the reason why Nicole and I are up here helping Ken out with this presentation

448
00:42:46,440 --> 00:42:53,120
because the vast majority of this work is done at the contracting agency.

449
00:42:53,120 --> 00:43:11,080
level by our staff. So we are the ones actually doing these calculations, not IUA. So our agency staff are responsible for placing the customer in the proper category, conducting the fixture accounts, preparing the EDU calculations, which we just discussed.

450
00:43:11,680 --> 00:43:20,040
And that information is what we provide to IUA in a high level summary table, which we call them a bar report.

451
00:43:20,040 --> 00:43:25,940
work. And the bar lists the customer name and location along with the type of connection,

452
00:43:26,420 --> 00:43:31,220
number of fix for units and total connection fees. And all of that backup documentation,

453
00:43:31,740 --> 00:43:36,960
all those calculations that we just went over, those are all kept with the contracting

454
00:43:36,960 --> 00:43:42,900
agencies and are generally not provided to IUA. We just provide that summary table on a

455
00:43:42,900 --> 00:43:51,040
monthly basis. IUA then summarizes all that information each agency submits into the monthly

456
00:43:51,040 --> 00:43:56,160
building activity report and that's included in our attack and policy agenda packets as

457
00:43:56,160 --> 00:44:04,160
informational. The contracting agencies individually collect the connection fees directly from the

458
00:44:04,160 --> 00:44:10,080
customer and we each maintain what's called the capital capacity reimbursement account or

459
00:44:10,080 --> 00:44:16,540
the CCRA area referred to that. These funds are held by each contracting agency until

460
00:44:16,540 --> 00:44:23,300
IUA makes what's called a capital call. And that's when IUA will request a certain

461
00:44:23,300 --> 00:44:30,560
amount of funds from the contracting agencies, a transfer of those funds to support capital

462
00:44:30,560 --> 00:44:38,620
projects for growth. So that about completes our presentation. We hope you found it helpful.

463
00:44:38,620 --> 00:44:41,040
and we're available for any questions.

464
00:44:41,960 --> 00:44:43,420
Okay. Thank you, Amanda.

465
00:44:43,900 --> 00:44:46,120
Thank you, Paul. Questions, Debbie.

466
00:44:46,720 --> 00:44:49,460
Can we go back to the commercial connection fee example?

467
00:44:50,940 --> 00:44:51,040
Sure.

468
00:44:53,600 --> 00:44:57,320
Okay. Since I'm not privy to, or I just don't know,

469
00:44:57,760 --> 00:44:59,920
this seems like a very, very...

470
00:45:00,000 --> 00:45:06,240
Small, example of a restaurant padded. Very small. I mean, when you have a single laboratory,

471
00:45:06,960 --> 00:45:12,480
you know, two urinals, one water closet, a drinking fountain. And then I go down here and look at

472
00:45:13,200 --> 00:45:21,200
sewer rate. So that's going to be a one time fee that $8,000? Yes. So these fees are one time for

473
00:45:21,200 --> 00:45:29,180
connection. It's in that $5,000 is also one time fee. The capital capacity fee. Yes, yes, that's

474
00:45:29,180 --> 00:45:36,600
the what you're paying for your EDU. So you're really looking at almost $14,000 for a very,

475
00:45:36,600 --> 00:45:41,240
very, very small restaurant pad, and that doesn't include the grease trap, right?

476
00:45:42,900 --> 00:45:47,500
The grease trap would be installed by and we don't require a grease trap, but that would really

477
00:45:47,500 --> 00:45:52,980
restaurant has ever reached. Well, that would be on the actual development. I mean, I get it,

478
00:45:52,980 --> 00:45:58,240
but so I was just looking at this and I'm going, how would anybody ever stand up a small restaurant

479
00:45:58,930 --> 00:46:06,280
and I look at these fees and it's just that's a lot. I mean, so how much is a chili's or an olive

480
00:46:06,280 --> 00:46:12,620
garden? I mean, these those restaurants are probably 20 times the size of this. Yeah, it all depends on

481
00:46:12,620 --> 00:46:18,120
the the fixture accounts. So it's almost you know Ontario's finding itself leaning towards maybe

482
00:46:18,120 --> 00:46:23,360
offering these smaller rest new smaller new restaurants some kind of help in paying

483
00:46:23,880 --> 00:46:29,480
these kinds of fees so that they will come and hopefully be successful and do that. But I mean

484
00:46:29,480 --> 00:46:38,360
there's just the cost here's a lot. Yeah I think the actual fee due is $5,549. It's not you don't

485
00:46:38,360 --> 00:46:44,660
to 8,620. That's the rate times that by the point 64, which is ED to be built. Am I correct?

486
00:46:44,760 --> 00:46:48,740
Based on formula? Yeah, I'm sorry. I didn't. I didn't really understand that. You're correct.

487
00:46:48,960 --> 00:46:53,720
100 is not include. That's part of the that's the rate and there's this percentage formula.

488
00:46:54,900 --> 00:47:01,120
Okay. Right. In this example, the number of ED uses point 64 and that's multiplied by the ED

489
00:47:01,120 --> 00:47:05,960
rate, which is the 8,620 to come out with that that 5,500 number.

490
00:47:10,840 --> 00:47:16,660
I just say you hear all the time people having such a hard time starting a business because

491
00:47:16,660 --> 00:47:23,800
of all the the fees and so just whatever we can do to decrease those would surely be

492
00:47:23,800 --> 00:47:24,400
appreciated.

493
00:47:27,300 --> 00:47:27,980
Okay.

494
00:47:29,000 --> 00:47:30,080
Anybody else?

495
00:47:31,220 --> 00:47:31,420
Good.

496
00:47:31,780 --> 00:47:34,380
No, it's just a personal quick.

497
00:47:34,900 --> 00:47:40,900
You show the industrial and sometimes we hear that we have an industrial line can just

498
00:47:40,900 --> 00:47:48,080
just say real difference between this EDU for industrial and then you hear of the industrial

499
00:47:48,080 --> 00:47:52,480
waste line that LA takes care of. The difference just real quick.

500
00:47:52,860 --> 00:47:58,520
Yes, sure. Yeah, so for the, yeah, the industrial waste line yet that you're talking about,

501
00:47:59,060 --> 00:48:04,580
IUA, we do have what we call the non-reclaimable waste system. So that is the, what we call the brine line.

502
00:48:04,700 --> 00:48:09,060
We have one line down here in the south and then also one in the north.

503
00:48:09,060 --> 00:48:13,540
of the discharges there are high and brine.

504
00:48:14,060 --> 00:48:17,500
So most of these industries are discharging TDS

505
00:48:17,500 --> 00:48:20,420
of 1,000 and above for the most part.

506
00:48:21,360 --> 00:48:25,200
And those industries acquired a different set of capacity

507
00:48:25,200 --> 00:48:28,060
to discharge to LA County Sanitation Districts

508
00:48:28,060 --> 00:48:30,260
where they treat the wastewater over there.

509
00:48:30,500 --> 00:48:32,320
And then the line down here in the south

510
00:48:32,320 --> 00:48:37,140
are for the industries that connect to SOPA's line

511
00:48:37,140 --> 00:48:38,360
and then else really goes to.

512
00:48:38,660 --> 00:48:44,420
And my understanding, too, is once the building's connected, even though the owners change,

513
00:48:44,620 --> 00:48:48,900
they can transfer what they've already paid, so the new owner doesn't pay this.

514
00:48:49,000 --> 00:48:52,020
It's the initial cost, so they actually transfer in this.

515
00:48:52,140 --> 00:48:56,760
Correct. Yeah, and that's why I came back up here to talk a little bit more about the fast food

516
00:48:56,760 --> 00:49:03,140
restaurant, for example. So example, this was, say, it was a Wendy's and it went out of business

517
00:49:03,140 --> 00:49:04,780
this and became a McDonald's.

518
00:49:05,520 --> 00:49:08,160
What happens at the sewer collection agency level

519
00:49:08,160 --> 00:49:10,140
is they take a look at the capacity

520
00:49:10,140 --> 00:49:11,240
that was purchased before.

521
00:49:11,500 --> 00:49:13,260
So EDU's, they'll do a fixture count.

522
00:49:13,660 --> 00:49:16,940
Any time a restaurant will calculate

523
00:49:16,940 --> 00:49:18,880
or will add additional fixtures,

524
00:49:19,180 --> 00:49:20,420
they'll take a look at the inventory

525
00:49:20,420 --> 00:49:21,700
of what was purchased before.

526
00:49:22,320 --> 00:49:24,660
So if you're doing any tenant improvements at the site,

527
00:49:24,980 --> 00:49:27,240
what's gonna happen is that you're not gonna pay

528
00:49:27,240 --> 00:49:29,000
for any additional fixtures in there,

529
00:49:29,520 --> 00:49:30,520
you'll pay for any additional.

530
00:49:30,520 --> 00:49:36,440
additional. So if you're not changing anything there, then you're not actually paying for additional capacity into the regional system.

531
00:49:37,220 --> 00:49:47,480
Yeah. And so this happens at the bars of committee. We've been talking about it. This happens all the time with any tenant improvement that happens in the service area.

532
00:49:48,000 --> 00:49:57,040
And this connection fee essentially is new places buying in to the system that everybody else that has paid into to build.

533
00:49:57,040 --> 00:49:59,960
And that's a capital now. That's it.

534
00:50:00,000 --> 00:50:06,260
It's in the member agency's bank accounts after it's collected until it's called on pursuant

535
00:50:06,260 --> 00:50:11,740
to the agreement or the ordinance, right? Yes. And I'm going to embarrass you a little

536
00:50:11,740 --> 00:50:17,660
bit, because I want to give a concrete example of how our staff goes above and beyond in specifically

537
00:50:17,660 --> 00:50:24,680
this gentleman. We had a restaurant in Chino Hills that didn't have the same reaction

538
00:50:24,680 --> 00:50:28,420
as Councilmember Faradah just had, oh my God, that's way too expensive.

539
00:50:30,160 --> 00:50:35,140
And Ken took his own time, went to a, it happens to be a chain, went to another one of them,

540
00:50:35,520 --> 00:50:41,780
in his home city in Orange County, looked at it and realized that it was a little bit misclassified

541
00:50:41,780 --> 00:50:46,800
because staff didn't completely understand the operations and was able to get it reclassified

542
00:50:47,340 --> 00:50:49,720
and save them something on the order of $50,000.

543
00:50:49,720 --> 00:51:04,100
dollars. Yeah, that's because it's a fast food and not a sit down because sit down is cost more because there's more involved right. So anyway, Ken and his staff and and the people we work with they all go above and beyond to help our mutual constituents if they can.

544
00:51:06,140 --> 00:51:07,420
Very good. Thank you, Steve.

545
00:51:08,560 --> 00:51:16,780
So Debbie call Ken when the restaurant's coming in he could probably all of our downtown is so old and we're trying to keep people on board.

546
00:51:16,780 --> 00:51:22,100
and I mean when you're looking at something it was built in the 30s and 40s, I mean everything's

547
00:51:22,100 --> 00:51:24,620
got to be redone and so it just has to be very expensive.

548
00:51:27,520 --> 00:51:29,780
Anybody else? Just to be real interesting,

549
00:51:29,780 --> 00:51:38,960
I'll get with Sabaji. If we just looked at flow, have we ever seen how far off our EDU's are to the

550
00:51:38,960 --> 00:51:44,440
flow? If we just made the denominator one and didn't care about BODs or TSS, we just said it's just

551
00:51:44,440 --> 00:51:47,640
just look at the floor. I was just wondering as a

552
00:51:48,300 --> 00:51:50,100
over face in it.

553
00:51:50,200 --> 00:51:50,560
Yeah,

554
00:51:55,960 --> 00:51:59,460
it's an interesting request. I don't know the answer off the top of my head.

555
00:51:59,580 --> 00:52:04,160
But I, but we will provide an answer at a later time.

556
00:52:04,740 --> 00:52:05,720
Yeah, exactly.

557
00:52:06,980 --> 00:52:08,020
Happy to do that.

558
00:52:09,760 --> 00:52:11,860
Oh, good. Thank you all. All right.

559
00:52:12,320 --> 00:52:12,840
Good.

560
00:52:12,980 --> 00:52:13,440
Thank you.

561
00:52:13,780 --> 00:52:20,320
Moving on to our item C, by your way, cost of service update and proposed rates for fiscal

562
00:52:20,320 --> 00:52:29,900
year 2526 and 2627 and Randy or savagery first and Randy.

563
00:52:30,100 --> 00:52:31,580
Thank you, Chair.

564
00:52:31,720 --> 00:52:32,480
I'm going to introduce this.

565
00:52:32,560 --> 00:52:34,960
Randy makes the long way up to the podium here.

566
00:52:35,380 --> 00:52:39,380
I just want to say good afternoon again, Chair and members of the policy committee.

567
00:52:39,380 --> 00:52:44,640
This afternoon, we're going to be providing a rates presentation for the agency's wastewater rates.

568
00:52:44,960 --> 00:52:49,620
In an effort to present how it fits in with the overall mission and the operations of IUA,

569
00:52:49,960 --> 00:52:55,100
we're including information on also the non-wastewater rates, including recycled water,

570
00:52:55,480 --> 00:52:57,380
groundwater recharge, and our water resources.

571
00:52:58,260 --> 00:53:03,040
The purpose of this workshop is to provide the policy committee a brief overview of the rates,

572
00:53:03,420 --> 00:53:07,120
key assumptions, considerations, and drivers for rate adjustments,

573
00:53:07,120 --> 00:53:20,280
including how we recommend to allocate property tax revenue and also related to that related to our rates is the staffing recommendations that are embedded in that recommendation.

574
00:53:21,120 --> 00:53:27,700
We'll also provide a comparison of other EDU rates, which is specific to our wastewater operation.

575
00:53:27,700 --> 00:53:35,640
The most recent rate adjustments by the board were in April of 2023 after a two-year rate

576
00:53:35,640 --> 00:53:41,600
that was established for the EDU, and that also included the time when we went into

577
00:53:41,600 --> 00:53:43,760
a lockdown for the coronavirus.

578
00:53:44,900 --> 00:53:50,120
While these are preliminary numbers, this work is a result of a significant effort by IUA staff

579
00:53:50,120 --> 00:53:55,060
to look forward in the next couple of years and determine how we can carry out our mission.

580
00:53:55,060 --> 00:54:01,580
And I want to make sure the policy committee knows that we are very sensitive to ensuring

581
00:54:01,580 --> 00:54:03,620
affordability when it comes to our rates.

582
00:54:04,040 --> 00:54:08,140
And what we have to balance is public health protection as well as environmental protection.

583
00:54:09,140 --> 00:54:14,340
I want to talk a little bit of while Randy waits up there patiently.

584
00:54:14,380 --> 00:54:18,920
I want to talk a little bit about the significant amount of work that our team put in.

585
00:54:19,620 --> 00:54:22,040
We basically have two divisions here at IUA.

586
00:54:22,040 --> 00:54:25,920
way. We have a finance and administration side and we have a technical services side.

587
00:54:26,660 --> 00:54:32,460
So our approach was to collaborate between our major divisions and with Randy and his

588
00:54:32,460 --> 00:54:36,440
team being in charge of this, it doesn't hurt that Randy as our director of finance has

589
00:54:36,440 --> 00:54:43,620
an operations background. What we did first was to identify all the requests when it came

590
00:54:43,620 --> 00:54:48,520
to our capital improvement program. And after that, we have to do a risk analysis. That

591
00:54:48,520 --> 00:54:54,180
That risk analysis shows where our vulnerabilities are, and that helps us prioritize these projects,

592
00:54:54,180 --> 00:54:58,360
which eventually feed into the budget, letting us know what we need to work on.

593
00:54:58,980 --> 00:54:59,920
we took a look at

594
00:55:00,000 --> 00:55:27,960
At the staffing required to handle the new paradigm that we're dealing with with less water, more constituents, growth in our area, as well as evolving regulations and enforcement actions from our permit. In addition to that, we went through this iterative process over about three months to reach this preliminary recommendation. So we look forward to presenting that today.

595
00:55:27,960 --> 00:55:32,960
This afternoon we have a joint presentation by Randy, as well as our rates consultant,

596
00:55:33,300 --> 00:55:33,940
Black and Veatch.

597
00:55:34,080 --> 00:55:38,520
We're joined by a principal and we who has worked closely with staff to develop these

598
00:55:38,520 --> 00:55:39,200
proposed rates.

599
00:55:39,940 --> 00:55:44,860
At the end of the presentation, which essentially kicks off our stakeholder outreach over the next

600
00:55:44,860 --> 00:55:49,860
two months, we look forward to your immediate feedback as well as further more detailed discussion.

601
00:55:50,760 --> 00:55:55,840
I will close with saying I really appreciate the amount of interest within our customer

602
00:55:55,840 --> 00:56:01,920
agencies already we've been requested to provide the rate study. We do not have that yet.

603
00:56:02,060 --> 00:56:05,800
We have assumptions, we have the work that we have put into it, we have our spreadsheets,

604
00:56:06,200 --> 00:56:11,440
and we have the document today. As that document is developed, we will continue to share

605
00:56:11,440 --> 00:56:16,280
whatever information we have at that time, ultimately resulting in presenting a draft

606
00:56:16,280 --> 00:56:21,500
rate study to the policy committee and then ultimately to the IUA board.

607
00:56:22,120 --> 00:56:27,280
With that, I'm going to hand it over to Randy, and I'd say this is approximately about

608
00:56:27,280 --> 00:56:31,660
a 30-minute presentation, and so with that, I'll pass it off to you.

609
00:56:31,820 --> 00:56:32,080
Thanks, Randy.

610
00:56:32,780 --> 00:56:32,940
All right.

611
00:56:33,260 --> 00:56:33,860
Thank you, Savaji.

612
00:56:34,360 --> 00:56:41,900
I so want to jump into the EDU equation discussion, as Randy Director, he knows I have an

613
00:56:42,800 --> 00:56:46,560
operator, operations background with the agency.

614
00:56:46,560 --> 00:56:51,860
Well, good afternoon, members of the Switch Policy Committee.

615
00:56:52,500 --> 00:56:53,640
My name is Randy Lee.

616
00:56:53,920 --> 00:56:55,320
I'm the Director of Finance.

617
00:56:56,080 --> 00:57:03,000
I'm here today to present to you the cost of service update and proposed rates for

618
00:57:03,000 --> 00:57:06,580
fiscal year 2526 and 2627.

619
00:57:07,980 --> 00:57:15,940
As you mentioned, I'll be joined with our consultant, Ambui, who's sitting back here later

620
00:57:15,940 --> 00:57:22,540
on. We have been collaborating in the last few months to develop this great. We're going

621
00:57:22,540 --> 00:57:23,820
to be present to you today.

622
00:57:26,240 --> 00:57:33,640
Also, this presentation was presented to our board yesterday as a workshop

623
00:57:33,640 --> 00:57:40,160
item was an informational item to them yesterday. This is the same presentation that I'm going to

624
00:57:40,160 --> 00:57:45,800
present to you today. But today's focus is going to be mainly on wastewater since this is a

625
00:57:45,800 --> 00:57:51,920
sewage policy committee. But I will go through the entire presentation with you.

626
00:57:53,220 --> 00:58:00,780
With that, let's start it. Here's the agenda for our presentation today. First, I will go over a

627
00:58:00,780 --> 00:58:07,520
high level of agency's revenue and rates and fees. This will cover the first two main topics,

628
00:58:07,520 --> 00:58:13,540
and then I will pass it on to and and will be presenting the cost of service and proposed rates.

629
00:58:14,240 --> 00:58:20,940
Once the rates are discussed, I will wrap up the presentation and provide you with additional information and

630
00:58:20,940 --> 00:58:27,480
background on rates and some comparison of our rates to other comparable peers in the industry.

631
00:58:28,860 --> 00:58:31,700
First, a revenue overview.

632
00:58:32,980 --> 00:58:40,140
Here is our revenue generally divided up into three categories, first is rates and fees

633
00:58:40,620 --> 00:58:43,960
and property tax and debt proceeds loans and others.

634
00:58:44,780 --> 00:58:48,840
In today's presentation, I'm going to be talking mostly on rates and fees.

635
00:58:49,440 --> 00:58:54,320
I will touch a little bit on the property tax and how much we receive and how we allocate

636
00:58:54,320 --> 00:58:56,700
to different funds within the agency.

637
00:58:58,660 --> 00:59:03,560
Here's a very useful slide that demonstrates

638
00:59:03,960 --> 00:59:07,160
how the different seven different rates and charges

639
00:59:07,660 --> 00:59:09,160
support the agency functions.

640
00:59:10,020 --> 00:59:12,360
Those rates and charges are shown in orange,

641
00:59:12,800 --> 00:59:15,040
boxes in the middle of this slide,

642
00:59:15,360 --> 00:59:19,560
and the function of the agency is shown on the bottom

643
00:59:19,560 --> 00:59:23,460
as different colors of the water drop on the bottom.

644
00:59:23,460 --> 00:59:30,160
For example, start off on the left hand side, we have wastewater capacity and connection

645
00:59:30,160 --> 00:59:36,600
fees, which was just discussed just now, so I'm not going to go too much into that.

646
00:59:37,640 --> 00:59:46,160
And then we have our monthly wastewater equivalent dwelling units, also known as EDU rates.

647
00:59:46,700 --> 00:59:52,340
Both of those supports the wastewater operation, regional composting, and renewable energy

648
00:59:52,340 --> 00:59:59,500
function within our agency. Moving over is our recycle water.

649
01:00:00,000 --> 01:00:27,520
Our recycle water is supported by recycle water direct use rates, recycle water, fix recovery rate, and one-water connection fee. And moving on over on the recycle water, groundwater recharge, that's supported by one-water connection fees and recycle water, groundwater recharge rates. And lastly, we have the MEU rate that supports water resources.

650
01:00:29,770 --> 01:00:34,870
Here's is a wastewater capacity and connection fee, as I mentioned previously.

651
01:00:35,690 --> 01:00:41,450
This fee is collected on new or expanded connection to the regional system, including

652
01:00:41,450 --> 01:00:44,690
collection, wastewater treatment and discharge system.

653
01:00:45,190 --> 01:00:51,030
This allows the developer to purchase capacity within the existing regional system and fund

654
01:00:51,030 --> 01:00:55,530
the regional project to me, forecast the growth and changing demands.

655
01:00:55,530 --> 01:01:04,410
The fee does not cover the day-to-day operation of the regional system and this fee is calculated

656
01:01:04,410 --> 01:01:10,290
by adding the recovery of capital costs related to IUS existing wastewater capacity and recovery

657
01:01:10,290 --> 01:01:14,070
of capital costs for building new capacity for forecasted growth.

658
01:01:15,490 --> 01:01:22,090
Another rate related to wastewater is the monthly wastewater equivalent dwelling unit rate.

659
01:01:22,090 --> 01:01:30,230
As I mentioned before, this is a rate that is paid by our residents in our local area.

660
01:01:30,890 --> 01:01:33,970
It's paid generally on the monthly basis.

661
01:01:34,650 --> 01:01:38,930
This rate is applicable to all connection to the regional system.

662
01:01:39,510 --> 01:01:46,110
This rate is also charged in addition to the local sewage rate that's charged by the retail

663
01:01:46,110 --> 01:01:46,750
agencies.

664
01:01:46,750 --> 01:01:54,210
IUA has a regulatory obligation to maintain wastewater system in compliance with our permits

665
01:01:54,210 --> 01:01:56,710
and to protect the public health.

666
01:01:57,310 --> 01:02:04,630
This rate does cover the operations and maintenance of the regional collection treatment

667
01:02:04,630 --> 01:02:06,210
and discharge system.

668
01:02:07,010 --> 01:02:11,950
I'm not going to go over the EDU race since that was already discussed earlier.

669
01:02:11,950 --> 01:02:15,350
And then we move on to recycle water.

670
01:02:15,730 --> 01:02:18,010
We have recycled water direct use rate.

671
01:02:18,430 --> 01:02:21,870
This is a water metric dollar per square foot rate

672
01:02:21,870 --> 01:02:25,890
for the purchase of recycled water through our purple pipe.

673
01:02:26,610 --> 01:02:30,450
The demand for recycled water is seasonal, is weather dependent,

674
01:02:31,010 --> 01:02:34,310
and also depends on the level of water conservation

675
01:02:34,790 --> 01:02:37,750
and reuse and supply and basin availability.

676
01:02:37,750 --> 01:02:44,950
This rate is calculated based on the sum of costs of operations and maintenance and rehab and replacement costs

677
01:02:45,290 --> 01:02:51,890
divided by the estimated annual demand for direct recycled water use.

678
01:02:52,730 --> 01:02:55,130
This rate starts at our recycled water pump station.

679
01:02:55,610 --> 01:03:03,490
Through our conveying system, our recycled water distribution system and ends at a customer's fence or a customer's meter.

680
01:03:05,130 --> 01:03:10,550
Another recycled water-related rate is our recycled water fix cost recovery rate.

681
01:03:11,240 --> 01:03:19,090
This rate was developed and put into our rate in back in fiscal year 2022-2023.

682
01:03:19,910 --> 01:03:26,070
This rate is charged to the recycled water contracting agency based on the three-year rolling

683
01:03:26,070 --> 01:03:30,410
average of direct and recharge recycled water use.

684
01:03:30,410 --> 01:03:38,110
This rate offsets the volumetric revenue that is paid for, this rate is actually paid for debt service.

685
01:03:38,590 --> 01:03:40,210
That's on the recycle water system.

686
01:03:41,030 --> 01:03:45,810
This is a common way to pay for assistance fixed costs such as debt service

687
01:03:46,250 --> 01:03:50,970
and it's not unique to IUA and is common practice in the water industry.

688
01:03:53,350 --> 01:03:59,750
Finally, another rate that supports recycle water is one water connection fee.

689
01:03:59,750 --> 01:04:04,510
This fee is on new or expanded connection to region's water system.

690
01:04:05,010 --> 01:04:10,430
This fee is established to support capital improvement and expansion of agency's regional

691
01:04:10,430 --> 01:04:16,950
water system, water use efficiency program, comprised of potable water, recycle water and

692
01:04:16,950 --> 01:04:18,210
groundwater recharge facilities.

693
01:04:20,680 --> 01:04:24,240
Then we have recycle water, groundwater recharge rate.

694
01:04:24,240 --> 01:04:31,600
This rate is related to a groundwater recharge, and this is added on top of the direct recycle

695
01:04:31,600 --> 01:04:32,720
water use rate.

696
01:04:33,480 --> 01:04:39,260
While our recharge basin can accept imported water, storm water, and recycle water,

697
01:04:39,540 --> 01:04:44,860
this rate supports only the groundwater recharge operations and maintenance and special projects

698
01:04:44,860 --> 01:04:47,120
associated with recycle water.

699
01:04:47,950 --> 01:04:53,200
This rate is calculated based on expenses associated with recycle water recharge divided by projected

700
01:04:53,200 --> 01:04:55,040
to recycle water, sail.

701
01:04:56,360 --> 01:04:59,060
Finally, we have meter equivalent rate.

702
01:04:59,340 --> 01:04:59,700
This is.

703
01:05:00,000 --> 01:05:29,740
Monthly fixed costs of potable water assessed using a meter equivalent unit or commonly known as MEU. MEU is defined as the average water use of a single family residence. This is for water resources program, which includes imported water supply. This rate provides stable source of funding to support comprehensive planning, studies and analysis related to enhancing long-term regional water supply reliability.

704
01:05:29,740 --> 01:05:35,900
It supports water conservation, recycling, groundwater recharge, storm water management programs.

705
01:05:36,420 --> 01:05:37,460
Oops, sorry.

706
01:05:42,790 --> 01:05:48,150
This also backs IUA's collaboration with regional and local water manager

707
01:05:48,150 --> 01:05:54,610
in managing both imported and local water supplies. And lastly, this rate covers the administrative

708
01:05:54,610 --> 01:06:01,130
costs related to procuring imported water, found metropolitan water district for IUA's customers.

709
01:06:01,810 --> 01:06:02,430
agencies.

710
01:06:06,760 --> 01:06:15,260
So next area is rates and feeds overview. Here is what we're proposing for the next two

711
01:06:15,260 --> 01:06:23,820
fiscal years. So on this slide, there are two tables. One on top is on wastewater and one on the

712
01:06:23,820 --> 01:06:31,200
bottom is on psycho water and water resources. So our main focus today is on the top table, which

713
01:06:31,200 --> 01:06:36,840
which is consists of wastewater operation monthly EDU and wastewater connection fees.

714
01:06:37,480 --> 01:06:40,140
First one is monthly EDU rate.

715
01:06:40,540 --> 01:06:49,400
The agency is proposing an increase to $27.02 from the current rate of $24.90, $70.09.

716
01:06:49,960 --> 01:06:54,520
The following year, the agency is proposing $29.49.

717
01:06:54,520 --> 01:07:01,040
cents on the wastewater connection fees we are not proposing any changes to that fee.

718
01:07:01,600 --> 01:07:04,540
So that will remain at $8,620.

719
01:07:05,500 --> 01:07:11,720
Moving down below on the wastewater on the recycle water, fixed cost recovery were proposing

720
01:07:12,700 --> 01:07:21,920
increased of 3% next couple of years to 5.11 million in first fiscal year and then 5.26

721
01:07:21,920 --> 01:07:31,080
in the second year. On the recycle water direct use, we're proposing an increase to $56.85

722
01:07:31,580 --> 01:07:39,520
from $465. And the following year, we're proposing an increase to $552.40,

723
01:07:40,220 --> 01:07:48,040
representing a 9% increase consistent in both years. Moving on to recycle water recharge,

724
01:07:48,040 --> 01:07:56,820
We are proposing a 4% increase on each of those fiscal year, going from $200 per acre

725
01:07:56,820 --> 01:08:03,880
foot to $208 first year and $216.32 in the following year.

726
01:08:05,100 --> 01:08:07,480
Next, we have one water connection.

727
01:08:07,920 --> 01:08:15,040
We are not proposing any changes to that fee, so it will remain $1,953.

728
01:08:15,040 --> 01:08:25,340
Moving on to water resources for water equivalent unit or MEU, we're proposing a 2.6 percent

729
01:08:25,340 --> 01:08:35,630
increase from $1.14 to $1.17 and the following year we're proposing $1.20.

730
01:08:37,300 --> 01:08:44,960
As I mentioned earlier, this presentation will mainly focus on race and charges, but I also

731
01:08:44,960 --> 01:08:51,800
mentioned that I'm going to be discussing our property tax and how the agency used property

732
01:08:51,800 --> 01:08:59,120
tax and how it's allocated to fund different programs within the agency. So that's on the next

733
01:08:59,120 --> 01:09:06,620
slide. So on this table, as you can see, this is for property tax allocation for the agency.

734
01:09:07,280 --> 01:09:12,680
The property tax we receive at the agency supports five different programs. One is wastewater

735
01:09:12,680 --> 01:09:19,740
water capitol, wastewater operation, recycle water, administrative services, and water resources.

736
01:09:20,720 --> 01:09:26,180
The column in the middle indicates the current allocation for property tax.

737
01:09:27,100 --> 01:09:31,580
And then the column right next to it is what we're proposing for the next two years.

738
01:09:32,420 --> 01:09:38,060
The two columns after that indicates the funding in terms of millions of dollars per year

739
01:09:38,060 --> 01:09:41,640
into those programs in the following two fiscal year.

740
01:09:42,220 --> 01:09:43,840
I want to bring to your attention

741
01:09:43,840 --> 01:09:47,240
that what we're proposing to change in the next two years

742
01:09:47,240 --> 01:09:52,980
is a shift of water resources of 3.5 percent to 1 percent

743
01:09:52,980 --> 01:09:56,460
and that change will go to the Recycle Water Fund

744
01:09:56,460 --> 01:09:59,520
going from 4 percent to 6.5 percent.

745
01:10:00,000 --> 01:10:29,860
And the reason why we're shifting that funding is to support the region's top priority program, which is the Chino Basin program, which I will get into in just a couple of slides. The next slide I will show you is the trend for the agency's property tax revenue. This goes back to fiscal year 1314. We were receiving just under $40 million of property tax.

746
01:10:29,860 --> 01:10:39,200
other way to the next couple of fiscal years. At the end of fiscal year 2627, we are projecting to

747
01:10:39,200 --> 01:10:49,080
receive about 95.6 million dollars of property tax. Property tax at the agency is at our

748
01:10:49,080 --> 01:10:54,420
board's discretion on how we allocate it and where we spend the money at different programs.

749
01:10:54,420 --> 01:11:01,720
So, as I mentioned before, our region's top priority program is the Chino Basin Program.

750
01:11:02,660 --> 01:11:07,440
Just a refresher, Chino Basin Program really has three major components.

751
01:11:08,240 --> 01:11:11,580
One is the Advanced Water Purification Facility.

752
01:11:12,220 --> 01:11:16,900
What this facility will do is take the ETHLIN found regional plan number four,

753
01:11:17,540 --> 01:11:20,880
as well as the import of recycled water found reallto,

754
01:11:20,880 --> 01:11:27,680
which will increase recycled water supply in the region and put that water through this

755
01:11:27,680 --> 01:11:34,500
advanced water purification facility, produce advanced treated water and then we will put

756
01:11:34,500 --> 01:11:40,860
that into a distribution system which is the next major component of the CBP which is the

757
01:11:40,860 --> 01:11:47,540
regional recycle groundwater replenishment. In that part of the program we will have pump

758
01:11:47,540 --> 01:11:54,220
stations, distribution pipelines and injection wells to inject this additional water into

759
01:11:54,220 --> 01:11:59,680
Chino Basin to increase the amount of water that's available in this region.

760
01:12:00,500 --> 01:12:05,120
And the third component of this project is the production and conveying facility associated

761
01:12:05,120 --> 01:12:13,480
with Prop 1, water storage, investment program or whistle. This is the program. Some of you may remember

762
01:12:13,480 --> 01:12:19,560
we receive a conditional funding of $215 million if we decide to move forward with it.

763
01:12:20,000 --> 01:12:25,660
It also comes with a certain amount of early funding which is whether or not this program

764
01:12:25,660 --> 01:12:30,580
is a goal or no goal, we still get to keep that funding for planning purposes.

765
01:12:31,780 --> 01:12:40,160
So moving down to the funding source for CBP, what we're not proposing in the next two years is to

766
01:12:40,160 --> 01:12:41,780
funded through rates and charges.

767
01:12:42,860 --> 01:12:48,960
What we're, how we're funding this program during this next two years is one-time property

768
01:12:48,960 --> 01:12:56,340
tax transfer from water resources fund to recycle water fund, and also reallocating

769
01:12:56,340 --> 01:13:03,660
like the two slides before, instead of 3.5% going to water resources fund, we're shifting

770
01:13:03,660 --> 01:13:07,680
that to recycle water fund to fund the next two years.

771
01:13:07,680 --> 01:13:14,900
and the long-term funding and cost allocation for CBP will be determined during the next

772
01:13:14,900 --> 01:13:26,120
race cycle. So that's on CBP. At this point, I will turn it over to Anne for her part of the

773
01:13:26,120 --> 01:13:33,300
presentation was she will go over each one of the funds and how that was determined through their

774
01:13:33,300 --> 01:13:33,680
process.

775
01:13:34,500 --> 01:13:34,620
And?

776
01:13:38,810 --> 01:13:39,870
Very much.

777
01:13:40,530 --> 01:13:42,010
Good afternoon, Chairman.

778
01:13:42,730 --> 01:13:44,730
And members of the Policy Committee.

779
01:13:44,890 --> 01:13:46,710
Thank you very much for having me today.

780
01:13:47,550 --> 01:13:49,030
So my name is Ann Booley.

781
01:13:49,350 --> 01:13:52,390
I am with from the Engineering Company of Black and Veatch.

782
01:13:52,810 --> 01:13:58,830
And I actually come for the Management Consulting side of our company where I serve as the Senior

783
01:13:58,830 --> 01:14:03,390
Managing Director and Lead for our Rates and Regulatory Practice.

784
01:14:03,750 --> 01:14:05,330
So it's very nice to see you all today.

785
01:14:05,950 --> 01:14:11,250
With me today is the project manager for this engagement that we have with the agency.

786
01:14:11,690 --> 01:14:12,890
Mr. Gregg, they're great there.

787
01:14:13,350 --> 01:14:19,310
So what I'd like to do for you today is sort of outline what we want to talk about here.

788
01:14:19,690 --> 01:14:23,190
We're going to go through and there's a number of slides here,

789
01:14:23,310 --> 01:14:27,950
but essentially we're going to start off with what the financial plan looks like each of the funds.

790
01:14:28,690 --> 01:14:33,430
And then thereafter we're going to go and take a look a little bit more closely

791
01:14:33,430 --> 01:14:37,730
at some of the cost drivers that are creating some of our needs here.

792
01:14:38,550 --> 01:14:40,170
Okay, great.

793
01:14:40,770 --> 01:14:42,330
So, let's begin.

794
01:14:43,210 --> 01:14:47,610
Right off the bat, we are going to talk about our wastewater operations financial plan.

795
01:14:48,590 --> 01:14:55,410
What the analysis is proposing are two years of 9% increases.

796
01:14:55,410 --> 01:14:59,930
So fiscal year is 25, 26, 9%, and fiscal year 27.

797
01:15:00,000 --> 01:15:29,860
6, 27, 9%, okay? So, if you look at the financial plan here, they're all set up in the same way. In the first portion of this table, you're going to take a look at all the revenue streams that come in. And then we go into all the revenue requirements, basically all the expenses and needs that we need to pay out in order to provide the services that we need to, to all of our customers, and then the fund balances. So, the existing level of rates

798
01:15:29,860 --> 01:15:40,520
that we have right now at $24.79 per EDU is going to generate approximately $89.6 million

799
01:15:40,520 --> 01:15:49,100
under the current year, and it's proposed to only increase slightly to $90.5 million.

800
01:15:49,960 --> 01:15:56,840
Right? After the implementation of the suggested revenue increases of 9% in each year,

801
01:15:56,840 --> 01:16:02,580
you can see those additional revenues are under the additional user charge revenue line there.

802
01:16:03,320 --> 01:16:09,280
You see that? We have some other operating revenue, which represents things like cost-free

803
01:16:09,280 --> 01:16:17,900
investments and interest income. As Randy mentioned, 23% of the total property taxes collected by the

804
01:16:17,900 --> 01:16:24,100
agency are being allocated to this particular fund, and that's represented on the following line

805
01:16:24,100 --> 01:16:31,000
that's called property taxes going through there, we do have an anticipated revenue bond

806
01:16:31,620 --> 01:16:38,240
that is right now being projected for 2627 and then just some other financing revenues.

807
01:16:38,700 --> 01:16:45,760
So overall from our fiscal year 2425, which we are in right now, we're anticipating total revenues

808
01:16:45,760 --> 01:16:55,200
of approximate weigh 114.8 million, and that will grow to 226.4 million by the end of

809
01:16:55,200 --> 01:17:03,480
25, 26, 27, excuse me, of which a large blip of that, that 89.3 represents a proceeds

810
01:17:03,480 --> 01:17:11,380
from bonding, okay? When we go into our revenue requirements section right here, we see we have

811
01:17:11,380 --> 01:17:15,080
O&M costs, capital projects, debt service and transfers.

812
01:17:15,560 --> 01:17:19,380
And just a word here, the fund is called the Operations Fund.

813
01:17:19,700 --> 01:17:23,200
So the capital projects here are really capital outlates,

814
01:17:23,340 --> 01:17:27,280
and these are basically our R&R projects,

815
01:17:27,520 --> 01:17:30,200
the repair rehab, repair and replacement type projects,

816
01:17:30,400 --> 01:17:32,720
like that, annual incurrences that you would have

817
01:17:32,720 --> 01:17:34,240
to maintain the system.

818
01:17:35,020 --> 01:17:35,340
Okay.

819
01:17:36,340 --> 01:17:39,980
On the next page, we'll go through what some of the breakdowns are

820
01:17:39,980 --> 01:17:44,120
here so that you could see what that looks like. So as you can see at the very end,

821
01:17:44,260 --> 01:17:48,180
just a summary of what that EDU rate is looking going from that 24.79,

822
01:17:48,900 --> 01:17:55,900
increasing up to the 27.02 in fiscal year 25.26 and upwards to 29.45

823
01:17:55,900 --> 01:18:00,140
in fiscal year 26.27. Okay, I know that's a lot of numbers.

824
01:18:00,680 --> 01:18:03,480
We're going to go to the next page where we have fewer numbers.

825
01:18:04,240 --> 01:18:09,260
What we have now are pie charts to help us understand where the cost allocations are.

826
01:18:09,260 --> 01:18:15,820
So, what the pie chart reflects is, over the two-year period, exactly where are the costs coming

827
01:18:15,820 --> 01:18:22,680
from? Okay? And here we see that approximately 47% of the costs are associated with employment

828
01:18:22,680 --> 01:18:30,040
expenses, which reflects the addition of not just additional staffing or full-time equivalence.

829
01:18:30,280 --> 01:18:35,820
That's the FTEs for our treatment operation support, but also some of the labor cost

830
01:18:35,820 --> 01:18:40,560
escalations that were approved in the MOUs, and that's reflected in there as well.

831
01:18:41,200 --> 01:18:50,280
We have utilities and chemicals, both from the new membrane bioreactor process that's coming

832
01:18:50,280 --> 01:19:00,700
online, electric utility costs, as well as just some other various chemicals and things that we're

833
01:19:00,700 --> 01:19:09,860
Now, overall, the usage of both the electricity and the chemicals has gone up, and that's

834
01:19:09,860 --> 01:19:18,500
what we were seeing here in terms of approximately a 4.4 to a 16.5 percent increase in the amount

835
01:19:18,500 --> 01:19:26,660
that's being used for utilities, and about 14 percent in 25, 26 for chemicals, and then

836
01:19:26,660 --> 01:19:30,500
and sort of backing back down to around a 6.3% level increase.

837
01:19:31,000 --> 01:19:31,120
Okay.

838
01:19:32,380 --> 01:19:34,540
Now, people always ask, yes.

839
01:19:34,680 --> 01:19:36,280
Do you mind if I ask questions along the way?

840
01:19:37,300 --> 01:19:43,060
I wouldn't ask if you think the answer is contained further into your presentation.

841
01:19:43,400 --> 01:19:44,220
I will defer.

842
01:19:44,440 --> 01:19:44,520
Yeah.

843
01:19:45,140 --> 01:19:51,780
I see the utilities expense 4% change, and then the following year 16%.

844
01:19:51,780 --> 01:19:55,380
How are you forecasting a 16% change in the second year?

845
01:19:55,380 --> 01:19:58,980
It's total volume, it's based upon the process he's coming on board.

846
01:20:00,000 --> 01:20:05,980
The new process for the membrane briover reactor is actually coming on board.

847
01:20:08,260 --> 01:20:09,600
The electricity cost

848
01:20:09,600 --> 01:20:14,800
will go up once we start using more air in the membrane bioreactor, and so that takes place

849
01:20:14,800 --> 01:20:20,620
in that second year, not in the first. Thank you. And director Reed, we'll also add

850
01:20:20,620 --> 01:20:26,220
on to that. We're to our best ability. We're tracking what SE rates will be in incorporating

851
01:20:26,220 --> 01:20:26,880
that as well.

852
01:20:31,770 --> 01:20:32,210
Very good.

853
01:20:32,350 --> 01:20:32,650
Thank you.

854
01:20:33,290 --> 01:20:35,010
Directory, did you have anything else?

855
01:20:35,290 --> 01:20:35,830
Or are we good?

856
01:20:36,650 --> 01:20:36,830
Okay.

857
01:20:36,930 --> 01:20:37,290
Very good.

858
01:20:37,750 --> 01:20:41,970
So I just wanted to go through all other a little bit, because that tends to be a catch-all

859
01:20:41,970 --> 01:20:44,670
and everybody kind of looks at it and goes, that's a lot.

860
01:20:45,330 --> 01:20:50,450
This includes things like our operating fees, professional fees and services, materials

861
01:20:50,450 --> 01:20:57,150
and supplies, and also this fund's proportionate share of administrative costs or our general

862
01:20:57,150 --> 01:20:59,610
mineral and administrative expenses, right?

863
01:21:00,210 --> 01:21:01,090
Also known as overhead.

864
01:21:03,380 --> 01:21:03,820
Very good.

865
01:21:04,700 --> 01:21:08,460
So, let's move on to the capital side of wastewater.

866
01:21:10,120 --> 01:21:15,920
Here, as we mentioned before, the proposed wastewater connection fee

867
01:21:15,920 --> 01:21:19,400
is not changing from its current rate.

868
01:21:19,840 --> 01:21:23,080
When we conducted the initial cost of service analysis,

869
01:21:23,460 --> 01:21:26,220
we found that there were sufficient funds there for it,

870
01:21:26,220 --> 01:21:31,940
And so it did not warrant a change or an increase in the fee, okay?

871
01:21:32,940 --> 01:21:38,960
What we see here, again, the revenues coming in from that, we have property taxes which,

872
01:21:39,360 --> 01:21:45,940
this particular fund receives 65% of the total property taxes that the agency collects.

873
01:21:46,820 --> 01:21:49,540
It's allocated to this particular fund.

874
01:21:50,660 --> 01:21:55,140
The next line here where it's got this little footnote here, it's called connection fees.

875
01:21:55,140 --> 01:21:57,960
that's the anticipated amount of connection fees

876
01:21:57,960 --> 01:22:00,680
that would be generated over the next few years.

877
01:22:01,360 --> 01:22:03,980
It is included here, but we do recognize that

878
01:22:03,980 --> 01:22:07,880
you all collect those fees and hold them for us,

879
01:22:08,120 --> 01:22:11,740
and it's not available until it's called, right?

880
01:22:11,940 --> 01:22:14,560
So it is included in this table,

881
01:22:14,860 --> 01:22:18,100
but it's not in the total of the total revenues there,

882
01:22:18,360 --> 01:22:21,200
because that just reflects what's the actual cash on hand

883
01:22:21,200 --> 01:22:22,000
that we have available.

884
01:22:23,420 --> 01:22:36,240
Okay. We have some revenue bonds that are proceeds that are coming in, which will then be used for the various capital projects that are occurring on this fund.

885
01:22:37,040 --> 01:22:47,340
And so we have total revenues growing from 123.2 million dollars in fiscal year 2425 to 350.

886
01:22:47,340 --> 01:22:52,720
50, just under that in the next fiscal year, and that's primarily because of the revenue

887
01:22:52,720 --> 01:23:00,840
bond financing coming in, and then dropping down to 95.9 million in fiscal year 2627.

888
01:23:01,480 --> 01:23:05,620
Total revenue requirements here, going through once again in the similar fashion.

889
01:23:05,860 --> 01:23:09,820
We have our O&M costs, then we have our capital projects.

890
01:23:10,000 --> 01:23:11,620
You can see where the majority of those are.

891
01:23:12,020 --> 01:23:16,260
We have debt service happening, and you can see we have a large blip in debt service happening

892
01:23:16,260 --> 01:23:24,020
and 25-26 and then we have some transfers and those transfers reflect this fund's proportionate

893
01:23:24,020 --> 01:23:30,180
share of paying for shared capital costs and that is reflected there. And you can see at the

894
01:23:30,180 --> 01:23:35,240
very end again there's no increase in the connection fee that's being proposed here.

895
01:23:36,500 --> 01:23:44,200
Okay, so let's move to our pie chart and what we have here is you can see that over the two years

896
01:23:44,200 --> 01:23:51,100
capital projects being handled out of this fund is just a shade under 88% of the cost

897
01:23:51,100 --> 01:23:58,980
that we see in the fund. We again have at 6.9% the largest, next largest slice of the

898
01:23:58,980 --> 01:24:04,620
pie is driven by employment expenses. Once again we see here this is reflective of additional

899
01:24:04,620 --> 01:24:10,020
staff as well as the labor cost escalations associated with the approved MOU.

900
01:24:13,220 --> 01:24:14,180
The next

901
01:24:14,180 --> 01:24:19,100
general and administrative expenses, which again is this fund's proportionate share

902
01:24:19,100 --> 01:24:21,560
of G&A costs that are allocated.

903
01:24:22,460 --> 01:24:27,160
And then finally, all other, there's some contract work and special projects in this particular

904
01:24:27,160 --> 01:24:31,020
category, as well as the operating fees and professional services.

905
01:24:32,460 --> 01:24:32,740
Okay.

906
01:24:33,280 --> 01:24:37,400
So before I move on to water, anything?

907
01:24:37,400 --> 01:24:38,520
Question?

908
01:24:41,860 --> 01:24:42,100
Yeah.

909
01:24:43,260 --> 01:24:43,600
That's that.

910
01:24:43,820 --> 01:24:44,660
Water capitol.

911
01:24:45,160 --> 01:24:46,020
Roll fast.

912
01:24:46,500 --> 01:24:47,660
Wastewater capitol.

913
01:24:48,060 --> 01:24:48,420
Fun.

914
01:24:48,940 --> 01:24:57,880
I was wondering on the transfers of 22.7 for next fiscal year and then 10.6, what is that

915
01:24:57,880 --> 01:24:58,540
transferring to?

916
01:24:58,640 --> 01:24:59,560
What is that for?

917
01:24:59,560 --> 01:24:59,700
Work.

918
01:25:02,420 --> 01:25:32,100
2.7 for fiscal year 2526. Yes, those represent a transfer to another fund to pay for shared capital projects. What type of capital projects? I have to take a look for the further details if you would like that we can. That's always the case. Do you need that going to the Chino-based program design? No. Yes. Well, all right. No. That was all being taken care of through the property tax usage. But we'll get to that one too.

919
01:25:32,100 --> 01:25:36,740
any other strategy? I had a few. I had a question.

920
01:25:39,300 --> 01:25:43,540
The question is I see for your wastewater

921
01:25:43,540 --> 01:25:52,960
capital fund project as far as employment expense going up 17% change. So what's that

922
01:25:52,960 --> 01:26:00,780
increase there? That's some additional FTEs full-time equivalent staff as well as the labor

923
01:26:00,780 --> 01:26:02,180
cost escalations.

924
01:26:03,660 --> 01:26:04,100
Okay.

925
01:26:06,570 --> 01:26:10,390
So when you say labor costs escalations, can you break that down for me?

926
01:26:11,570 --> 01:26:17,690
Well, there was an agreement that was ratified for the MOU's, but should I ask you if you'd like to?

927
01:26:17,790 --> 01:26:18,230
Yeah, thank you.

928
01:26:18,270 --> 01:26:26,550
And you touched on it last year, the board entered into five MOU's with our bargaining units, as well as two personnel manuals with the unrepresented staff.

929
01:26:26,550 --> 01:26:34,470
and these employment expenses reflect the additional labor required to conduct our capital

930
01:26:34,470 --> 01:26:40,070
improvement program as well as the new terms included in those MOUs.

931
01:26:46,480 --> 01:26:47,140
Thank you, Chris.

932
01:26:47,960 --> 01:26:54,540
All righty, we're going to go through the waste water utility in the same manner on the water

933
01:26:54,540 --> 01:26:56,000
utility type of things here.

934
01:26:56,000 --> 01:27:04,480
We're proposing a three cent per month per MEU increase in both of the fiscal years.

935
01:27:04,820 --> 01:27:15,740
So from 2425 to 2526, it increases three cents, so $1.14 to $1.17, which represents approximately 2.6%.

936
01:27:15,740 --> 01:27:19,080
And then on the ensuing year, it will be another three cents.

937
01:27:19,580 --> 01:27:22,840
I like this one because I can get three cents in my head really quickly.

938
01:27:22,840 --> 01:27:28,820
doing that math which represents another 2.6%. Again, the additional revenues that are associated

939
01:27:28,820 --> 01:27:35,120
with that incremental change is represented on the additional user charge line right there.

940
01:27:35,700 --> 01:27:41,080
So it would be 146.7 thousand dollars in fiscal year 2526,

941
01:27:41,740 --> 01:27:48,820
increasing to an additional just a shade under 300,000 dollars in fiscal year 2627.

942
01:27:48,820 --> 01:27:58,260
Again, we have other operating revenues here, which includes the pass-through for the

943
01:27:58,260 --> 01:28:02,100
metropolitan water district rates and charges going through here, too.

944
01:28:02,600 --> 01:28:09,340
This is where we see this particular imported water costs and the pass-throughs, okay?

945
01:28:10,960 --> 01:28:21,600
May, Peter, you know, on your, on revenue requirements on O&M, I see this 70, 74, and 79 knowing

946
01:28:21,600 --> 01:28:26,560
that department, it says O&M, could I just say that's just all salaries because there's

947
01:28:26,560 --> 01:28:30,380
really no maintenance going on. So am I correct in that?

948
01:28:30,760 --> 01:28:31,640
Let's take a look.

949
01:28:46,150 --> 01:28:54,510
And I'll jump in here, Director Read, you can see the bulk of this fund is a pass through

950
01:28:54,510 --> 01:28:59,010
when it comes to purchasing imported water and selling that to our three major customers.

951
01:29:00,330 --> 01:29:03,290
So that top line shows the bulk of the cost there.

952
01:29:03,290 --> 01:29:07,110
So it's just almost under, like, 85 percent of it.

953
01:29:07,310 --> 01:29:09,550
So then, so thank you.

954
01:29:09,670 --> 01:29:17,310
So I see the employment expense of, that's where it's at 4.2, 4.8, and then 5.3 million.

955
01:29:18,850 --> 01:29:23,090
The expense of, of, of, of, of illustrating the water that comes through.

956
01:29:23,970 --> 01:29:24,610
Yes, sir.

957
01:29:25,650 --> 01:29:30,870
We have some special works and projects that are occurring here as well, and then, again,

958
01:29:30,870 --> 01:29:33,990
and some miscellaneous charges that comes through the O&M,

959
01:29:34,750 --> 01:29:37,390
that would be like the G&A costs and utilities,

960
01:29:37,850 --> 01:29:41,090
some cherries and supplies, and some small cost items

961
01:29:41,770 --> 01:29:42,290
right there.

962
01:29:43,230 --> 01:29:43,490
Okay.

963
01:29:50,580 --> 01:29:53,400
Direct use, recycled water financial plan.

964
01:29:53,940 --> 01:29:57,880
Here, the suggestions are here,

965
01:29:57,980 --> 01:29:59,960
the proposed increases would be on the fixed cost.

966
01:30:00,000 --> 01:30:29,980
Last side recovery would be approximately 3% in each of the fiscal years that we're looking at. And then on the direct use side, which is on a dollar per acre foot basis, it would be 9% in each of these years going through. Okay. So again, here we have a proposed increase, as Randy mentioned before, that the property tax revenue here would go from the allocation of 4% as it is right now. The proposal is to increase it to 6.5%.

967
01:30:29,980 --> 01:30:34,360
percent, okay, to help balance things out here, okay?

968
01:30:34,840 --> 01:30:42,600
And this is where we have served to your question, the $24 million transfer coming from

969
01:30:42,600 --> 01:30:49,940
the property tax reserves to pay for those early stage, you know, basic program aspects.

970
01:30:50,680 --> 01:30:55,160
So it doesn't come from the rate revenue that's coming from property taxes here, it deserves.

971
01:30:56,240 --> 01:30:57,520
Just real quick.

972
01:30:58,060 --> 01:31:03,240
So, Fodgy, you know, on my last question, if I may, on the expense, is any of that taken

973
01:31:03,240 --> 01:31:09,420
out of the MEU or is it all through what's been charged for per acre foot?

974
01:31:11,660 --> 01:31:16,460
On the water resources fund, you're talking about the different revenues that support that

975
01:31:16,460 --> 01:31:17,160
program.

976
01:31:17,160 --> 01:31:27,520
They include MEU revenue and property tax as well, but when you say, are they talking specifically about employment expenses?

977
01:31:28,380 --> 01:31:31,580
Yes, a portion of those are supported by MEU.

978
01:31:32,060 --> 01:31:32,280
Yes, sir.

979
01:31:39,590 --> 01:31:41,370
Yeah, it keeps going on for some reason.

980
01:31:41,370 --> 01:31:47,750
And anyway, property taxes, so we've been pretty stagnant for the last couple of years

981
01:31:47,750 --> 01:31:49,590
you might say because not many of sales.

982
01:31:50,150 --> 01:31:56,130
What happens in the future is just out of curiosity if we were to have a market shift

983
01:31:56,550 --> 01:32:03,490
in real estate and the reassessment of properties could be significant because the amount of homes

984
01:32:03,490 --> 01:32:08,710
right now that have gone up in value that are not being assessed at the current market value

985
01:32:08,710 --> 01:32:13,630
but being, you know, I've been in my home now for almost 30 years and there's not

986
01:32:13,630 --> 01:32:19,050
sound nowhere to go. Plus, I got to be mayor for three more years. But there's going to be a

987
01:32:19,050 --> 01:32:24,070
significant amount of people that are potentially going to move when it's just very strong. So then

988
01:32:24,070 --> 01:32:29,190
that increases the amount of property tax, which I think is going to be significant. It's going to be

989
01:32:29,190 --> 01:32:36,730
huge when this market ship. What happens then? Mayor, I'd ask for just a little more time.

990
01:32:36,730 --> 01:32:42,130
Randy's got two slides that will really address that question in terms of showing a historical

991
01:32:42,130 --> 01:32:46,690
property tax revenue that we've received at IUA and how we allocate it.

992
01:32:47,230 --> 01:32:51,130
And then we can have the discussion there about how those numbers go up in the decisions

993
01:32:51,130 --> 01:32:51,490
we have.

994
01:32:51,730 --> 01:32:54,230
But we have a couple slides that really support that response.

995
01:32:54,230 --> 01:32:54,810
Thank you.

996
01:32:57,540 --> 01:33:03,320
So here we have the breakdown similar to what we have shown in the prior funds.

997
01:33:03,460 --> 01:33:08,460
Again, what's the two-year cost distribution of the cost drivers that we see within this

998
01:33:08,460 --> 01:33:16,180
fun. Capital projects and employment expenses have the largest portion of the pie chart here,

999
01:33:16,680 --> 01:33:21,980
and then we are followed by our debt service and our utilities going through again,

1000
01:33:22,160 --> 01:33:28,800
same sort of drivers in terms of the cost there, additional FTEs and projects that are going on,

1001
01:33:29,100 --> 01:33:33,200
as well as just the increased usage in our utilities.

1002
01:33:35,060 --> 01:33:41,960
Okay. You see overall from an O&M perspective, it goes from 6.5% increase in the proposed

1003
01:33:41,960 --> 01:33:45,720
numbers, and then an additional 7.8%.

1004
01:33:47,990 --> 01:33:52,950
You know, I think I'm becoming very frustrated with these little titles, let's say capital

1005
01:33:52,950 --> 01:33:58,210
projects. When you guys say that, I like you to list out what the capital projects are.

1006
01:33:58,670 --> 01:34:03,250
When you say depth service, tell me, what are we paying off? I'd like to know what that is.

1007
01:34:03,250 --> 01:34:06,810
When you say employment expenses, what do you mean by that?

1008
01:34:06,850 --> 01:34:09,970
Is it all the recent hires that we've done in the last three years?

1009
01:34:10,230 --> 01:34:15,030
And there's always you guys are known here for paying rather well, you know,

1010
01:34:15,050 --> 01:34:19,410
more so that you're you still employees from our cities all the time

1011
01:34:19,410 --> 01:34:21,790
because you pay rather well, you know.

1012
01:34:21,910 --> 01:34:26,390
So I would appreciate it if you list all those things out because for me

1013
01:34:26,390 --> 01:34:30,450
that then leads to some transparency interested into what's going on.

1014
01:34:30,450 --> 01:34:33,150
So can you tell me what those capital projects are?

1015
01:34:33,250 --> 01:34:41,410
We do have a listing and if you don't mind, I would rather prefer to provide that to you in a document later.

1016
01:34:41,830 --> 01:34:44,770
That's fine, but then from now on in all future presentations.

1017
01:34:45,250 --> 01:34:47,830
Is it for inviting me a document later on?

1018
01:34:48,230 --> 01:34:53,670
Can you provide it now so that everybody who's here, everybody that's listening can see that.

1019
01:34:54,150 --> 01:34:56,070
I mean, that's what I would hope for.

1020
01:34:56,070 --> 01:34:59,930
So because otherwise later on, half of these people aren't going to come out of it.

1021
01:35:00,000 --> 01:35:29,780
I'm back. They're not going to know. They're not going to be listening anymore. And then the information's lost. So please do. Please help me, you know, you know, I appreciate it. I understand. And we will take that under. I mean, and here's my contract work special project. What's the difference between that and capital project? So this, this that one out too. I don't know. Understood. And we will provide you that information in the future. Well, actually, the next meeting, if you want to provide that.

1022
01:35:29,780 --> 01:35:32,320
so that everybody can hear and see you in touch at that being great.

1023
01:35:32,840 --> 01:35:33,120
Understood.

1024
01:35:33,500 --> 01:35:34,620
Just a note, Steve.

1025
01:35:35,600 --> 01:35:42,220
It's this committee wants to get into the weeds of every single line item of this agency's budget

1026
01:35:42,780 --> 01:35:49,120
because they want to review the rates that my board that I'm on that's five of us and one on the back there.

1027
01:35:50,200 --> 01:35:55,720
That's fine, but we're not going to have a three-hour presentation to the policy committee

1028
01:35:55,720 --> 01:36:01,040
with line-item detail on every part of a pie job for seven separate

1029
01:36:02,560 --> 01:36:06,900
budget of fees and costs, et cetera. It's just not it's not physically possible.

1030
01:36:07,040 --> 01:36:10,820
What you're just providing that list, I'm not asking to add more time.

1031
01:36:10,820 --> 01:36:14,040
You know what you said was bring it to the next meeting and do this and do that.

1032
01:36:14,300 --> 01:36:15,520
You don't do a certain staff.

1033
01:36:15,760 --> 01:36:20,200
You're raising rates an awful lot here and we really like the justification as well.

1034
01:36:20,540 --> 01:36:24,120
So first of all, we're not raising rates yet. Our board is just presented this yesterday.

1035
01:36:24,120 --> 01:36:31,040
were evaluating staff's suggestion as we were elected by the people of this region to do.

1036
01:36:31,200 --> 01:36:36,160
They don't even know that you guys meet at 10 o'clock in the morning on whatever day of the week it is.

1037
01:36:36,300 --> 01:36:42,360
Well, we're not going to solve it here, but all I'm saying is that you're demanding stuff of our staff

1038
01:36:42,360 --> 01:36:49,500
and a consultants that costs money that is not realistic because you will get a four-inch thick budget.

1039
01:36:49,500 --> 01:36:52,680
with respect, if I can say something,

1040
01:36:52,840 --> 01:36:54,740
I'm the Neophyte on the Board here,

1041
01:36:55,440 --> 01:36:59,720
and I don't understand very, very little

1042
01:36:59,720 --> 01:37:02,260
about what I'm reading, what I'm hearing.

1043
01:37:03,040 --> 01:37:07,920
I actually would appreciate some additional information,

1044
01:37:07,920 --> 01:37:09,060
maybe in an exhibit.

1045
01:37:09,560 --> 01:37:11,760
I'm not saying that you would have to go over it

1046
01:37:11,760 --> 01:37:14,740
in the presentation, but like Debian mentioned,

1047
01:37:14,920 --> 01:37:16,420
it'd be nice to be able to see that

1048
01:37:16,420 --> 01:37:22,120
and some exhibit placed in the presentation itself.

1049
01:37:22,440 --> 01:37:24,380
That would help me greatly as well.

1050
01:37:27,090 --> 01:37:28,850
And we do have by the way of plans

1051
01:37:28,850 --> 01:37:30,070
that your staff all know about

1052
01:37:30,070 --> 01:37:32,030
that's called a 10-year capital improvement plan.

1053
01:37:32,870 --> 01:37:35,890
That's vetted and changed every single year

1054
01:37:36,190 --> 01:37:38,470
and the major projects are actually listed there.

1055
01:37:38,950 --> 01:37:41,730
So I would encourage everybody to talk to their staff

1056
01:37:42,170 --> 01:37:43,810
and our staff will be available

1057
01:37:43,810 --> 01:37:46,030
to provide additional information

1058
01:37:46,030 --> 01:37:48,270
but an overview presentation like this

1059
01:37:48,270 --> 01:37:54,210
like our board got yesterday and Director Reed was here you can't get into that level of detail of

1060
01:37:54,210 --> 01:38:00,090
what projects are under the recycle water cost drivers in a presentation like this at a high level.

1061
01:38:00,290 --> 01:38:06,650
It's just not we'd be here until nine o'clock tonight. If I if I may because I know how the budget's

1062
01:38:06,650 --> 01:38:12,850
done here would you would you like to see those like anything over a million or anything five or

1063
01:38:12,850 --> 01:38:18,690
How would you like a catalog, Debbie? So you could they won't be fine. Just say one through 10 just a little stuff

1064
01:38:18,690 --> 01:38:24,930
The project you don't even say it out loud. They're just you just even a little pre thing on the bottom say capital projects

1065
01:38:24,930 --> 01:38:26,530
One through 10 whatever

1066
01:38:29,510 --> 01:38:34,650
Probably I mean it's not there and that's all done like so many wants to see if they're meeting you can click themselves

1067
01:38:34,650 --> 01:38:38,630
I'm not as concerned. Why should you're gonna respond chair? Yes

1068
01:38:38,630 --> 01:38:43,550
One of the responses directory liability addressed which is our tenure capital improvement

1069
01:38:43,550 --> 01:38:49,330
plan in addition to that on a monthly basis in our General Manager's report we provide

1070
01:38:49,330 --> 01:38:54,370
a summary of our capital improvement program. So between those two documents we have the information

1071
01:38:54,370 --> 01:38:58,770
there that outlines what we're working on for the next 10 years. The board recently approved that,

1072
01:38:58,990 --> 01:39:05,450
the policy and tech committee reviewed the TYSEF which is specific to the wastewater but both are

1073
01:39:05,450 --> 01:39:12,410
available online. In addition to that we can provide that backup but all of that information exists

1074
01:39:12,410 --> 01:39:17,830
already, and if there's something specific and said it well, we can provide that as an

1075
01:39:17,830 --> 01:39:18,430
appendix.

1076
01:39:19,310 --> 01:39:23,910
So, suppose you're saying that that capital improvement program is embedded here in the

1077
01:39:23,910 --> 01:39:24,590
capital projects?

1078
01:39:25,310 --> 01:39:32,150
So, yeah, just provide a little more detail to Director Eli's comment every year, the board,

1079
01:39:32,510 --> 01:39:38,830
and specifically to the wastewater part of the CIP is reviewed by the Tech and Policy Committee.

1080
01:39:38,830 --> 01:39:44,930
and so then that's a 10-year plan that evolves based on the risk of projects and

1081
01:39:44,930 --> 01:39:46,670
That's not then what that means though

1082
01:39:46,670 --> 01:39:53,190
So then we take those two years and we look at at least for the expenses in a two-year budget or a two-year rate process

1083
01:39:53,190 --> 01:39:59,930
We look two years out of that 10 and we put that in here so that's the document that guides what that number is

1084
01:40:00,660 --> 01:40:27,500
And that's an existing approved document already. Yes, it does change. And that's how we are. But this is the best information we have today for the next two years. At the next time when we do a rate study, we're going to take the information from our current 10-year capital improvement plan and incorporate that as well. Just for clarification, I'm sorry. We've seen the 10-year capital plan every year, and this policy can be so. Is that coming back to us next month, for example?

1085
01:40:27,500 --> 01:40:30,940
Well, we will review it again, or we don't review those anymore.

1086
01:40:31,440 --> 01:40:39,180
You review the 10-year sewer capital plan on an annual basis, and whatever you have approved

1087
01:40:39,180 --> 01:40:41,680
that information is in this.

1088
01:40:41,960 --> 01:40:42,860
So is that coming to us?

1089
01:40:43,760 --> 01:40:45,200
Is the update coming to us?

1090
01:40:45,480 --> 01:40:49,960
Usually it comes up to us in the springtime every year that the 10-year sewer capital plan.

1091
01:40:50,180 --> 01:40:51,340
I can't remember the month.

1092
01:40:51,480 --> 01:40:56,000
We do that, but as we go on in the presentation, I'll confirm when we bring that on an annual

1093
01:40:56,000 --> 01:40:57,440
basis for consideration.

1094
01:40:58,060 --> 01:40:58,140
Okay.

1095
01:41:00,780 --> 01:41:01,100
Okay.

1096
01:41:01,740 --> 01:41:01,860
Damn.

1097
01:41:02,360 --> 01:41:02,820
Very good.

1098
01:41:03,920 --> 01:41:04,340
Thanks, sir.

1099
01:41:04,700 --> 01:41:05,980
I'm trying to make it like that.

1100
01:41:06,120 --> 01:41:08,720
Round water recharge, search charge, financial plan.

1101
01:41:08,880 --> 01:41:18,800
Here, we are looking at approximately a 4% increase for years, you know, $8 in per acre

1102
01:41:18,800 --> 01:41:26,820
foot, in $25, $26 in an additional $8 and $32 in fiscal year, $26, 27 going through.

1103
01:41:26,820 --> 01:41:34,900
Again, we have the revenues from the existing surcharge are being based upon the member agencies

1104
01:41:34,900 --> 01:41:38,680
three year rolling average that were provided to us.

1105
01:41:40,000 --> 01:41:46,180
Okay, and so we have some transfers out including here for capital and operation support for

1106
01:41:46,180 --> 01:41:53,820
the admin services fund as well as the recharge water fund, right, and also transfers out

1107
01:41:53,820 --> 01:41:58,540
for debt service support from the wastewater capital fund in here.

1108
01:42:02,240 --> 01:42:07,800
As you can see here, really, the greatest portion of activities that are going on in this particular fund

1109
01:42:07,800 --> 01:42:15,020
are associated with the groundwater recharge operations and then just the employment expenses going through here.

1110
01:42:15,400 --> 01:42:21,360
And that's just simply because of the dollar volume that's associated with those particular line items going through.

1111
01:42:22,900 --> 01:42:23,420
Yes?

1112
01:42:26,290 --> 01:42:30,430
We can say employee expenses in ground research operation.

1113
01:42:30,550 --> 01:42:36,290
Could I say the contracts that come under to maintain them, like hiring people, would

1114
01:42:36,290 --> 01:42:40,750
that be under the ground water reach in our job operation, that would be under the professional

1115
01:42:40,750 --> 01:42:41,650
fees and services?

1116
01:42:48,660 --> 01:42:54,280
And we get to our one water connection fee here, where as we mentioned earlier on, there is

1117
01:42:54,280 --> 01:43:02,240
There's no change being proposed for this connection fee in fiscal year 2526, nor 2627.

1118
01:43:02,780 --> 01:43:10,380
This shows the buildup of how that cost of service came to that conclusion going through.

1119
01:43:10,680 --> 01:43:19,300
The final calculation was approximately $1,955, given that the current fee is $9,953.

1120
01:43:19,300 --> 01:43:24,320
we felt that maintaining it at the current level was sufficient and going through.

1121
01:43:25,060 --> 01:43:26,360
Okay, and that's that recommendation.

1122
01:43:28,000 --> 01:43:34,620
So, with that said, we recap again with the table that you saw earlier just to refresh everyone's memory.

1123
01:43:35,260 --> 01:43:39,680
At the top, we have our wastewater funds that we're looking at on the bottom.

1124
01:43:39,680 --> 01:43:42,660
We have our recycled water and water resources funds.

1125
01:43:43,300 --> 01:43:48,300
And again, we have approximately 9% being recommended here.

1126
01:43:48,300 --> 01:43:56,960
here initially for fiscal year 2526 and 2627 additional 9% for the monthly sewer charge

1127
01:43:56,960 --> 01:44:04,000
on a per EDU per month basis and then no change on the wastewater connection fee remaining

1128
01:44:04,000 --> 01:44:07,780
at $8,620 on recycled water.

1129
01:44:07,820 --> 01:44:14,400
We're seeing 3% increases for each of the fiscal years on the fixed recovery side, an additional

1130
01:44:14,400 --> 01:44:24,180
9% on a direct use, basis of a dollar per acre foot, 4% increases for the recharge,

1131
01:44:24,520 --> 01:44:30,340
so charge again on a dollar per acre foot basis, no change in the one-water connection fee,

1132
01:44:30,920 --> 01:44:39,000
which is charged on a meter equivalent unit basis, and a small 2.6% increase in each of the years

1133
01:44:39,000 --> 01:44:43,400
that we are looking at for the Water Resource MEU fee.

1134
01:44:44,420 --> 01:44:49,280
With that, I'm going to now turn it back over to Randy.

1135
01:44:50,200 --> 01:44:50,600
Thank you, Ann.

1136
01:44:50,700 --> 01:44:54,800
And while we're transitioning speakers, I just want to address Mayor Dutre's question.

1137
01:44:55,200 --> 01:44:59,920
The process starts at the end of April with an action in June.

1138
01:45:00,000 --> 01:45:06,960
And by the policy committee for the 10-year capital improvement program forecast, as well as the sewer

1139
01:45:06,960 --> 01:45:13,620
capital forecast. Thank you. All right. Thank you, Ann. Thank you, Savaji.

1140
01:45:14,140 --> 01:45:20,140
I will wrap up the presentation. But before I do, there are a couple of key points to share

1141
01:45:20,140 --> 01:45:27,020
with you. One of them is agency's quitter rating, one staffing level, and how we compare as far

1142
01:45:27,020 --> 01:45:36,480
EDU to other peers in our industry. So, first is the agency's credit rating. One of the things we

1143
01:45:36,480 --> 01:45:44,320
look at regularly is our credit rating. Currently, our credit rating stands at AA2 by Moody's. This

1144
01:45:44,320 --> 01:45:51,800
was done just last year in 2024. When we're looking at cost of service and proposed rates and

1145
01:45:51,800 --> 01:45:56,600
charges would look at some of these key metrics that impact our credit rating.

1146
01:45:57,080 --> 01:46:03,360
These metrics includes dates of cash on hand and debt coverage ratio.

1147
01:46:04,040 --> 01:46:09,260
Debt coverage ratio is a calculation based on our annual revenue minus our operating fees,

1148
01:46:09,680 --> 01:46:15,800
and that leftover is divided by our annual debt service payment requirement, resulting

1149
01:46:15,800 --> 01:46:18,160
number as a debt coverage ratio.

1150
01:46:18,160 --> 01:46:36,320
Just as a background based on our last credit rating by Moody's, they mentioned that for us to maintain our current rating, we need at least have a debt coverage ratio of two and maintain our cash on hand at least 365 days.

1151
01:46:36,960 --> 01:46:43,500
And that's the minimum once we move below that our credit rating could be at risk of being downgraded.

1152
01:46:43,500 --> 01:46:50,340
And so it's very important for us to keep a high quality

1153
01:46:50,340 --> 01:46:55,080
quitter rating for the agency because as Savaji mentioned earlier,

1154
01:46:55,260 --> 01:47:00,160
we have a very large 10-year capital improvement plan and it's very likely

1155
01:47:00,160 --> 01:47:03,760
that we may need to go out for debt and when we go out for debt,

1156
01:47:04,160 --> 01:47:11,080
our quitter rating is very important and when we have a high quitter rating,

1157
01:47:11,080 --> 01:47:15,040
our borrowing cost becomes less and when we have good

1158
01:47:15,040 --> 01:47:20,260
credit rating our access to the market opens up more because more

1159
01:47:20,260 --> 01:47:25,520
institution will want to buy high credit rated bonds. So to sum it up the

1160
01:47:25,520 --> 01:47:29,200
higher credit rating we have the lower our borrowing cost is and the lower

1161
01:47:29,200 --> 01:47:33,920
our capital cost is and in turn eventually in the long run benefits all of our

1162
01:47:33,920 --> 01:47:35,840
customers in the long run.

1163
01:47:38,910 --> 01:47:45,390
Next is staffing level. Here is a summary of the staffing

1164
01:47:45,390 --> 01:47:51,930
request for this next two years. This table is basically divided up into three sections.

1165
01:47:52,570 --> 01:47:57,770
First is the technical resources division, then administrative division, and then agency

1166
01:47:57,770 --> 01:48:03,750
management division. There are departments underneath each of the divisions. There are

1167
01:48:03,750 --> 01:48:10,550
departments as shown here. And the road below that is the fiscal year. For fiscal year

1168
01:48:10,550 --> 01:48:17,390
2526, the agency is requesting additional 15 staff. And the following year, the agency

1169
01:48:17,390 --> 01:48:24,150
is requesting a 13 additional staff, bringing the total to a total of 28 additional staff.

1170
01:48:24,390 --> 01:48:26,610
Can I ask real quick, what is our current staffing level?

1171
01:48:26,610 --> 01:48:38,090
It's 158, I mean, it's a three, three 58. Sorry. All right. So before I move,

1172
01:48:38,570 --> 01:48:41,490
how much? Three 58. Three 58.

1173
01:48:45,700 --> 01:48:55,280
Before, so the bullets listed below the table are the main drivers for the, for the increases. So

1174
01:48:55,280 --> 01:48:58,520
I will go over each one of them and explain what they are.

1175
01:48:59,340 --> 01:49:02,460
So first one is wastewater treatment facility expansion.

1176
01:49:03,040 --> 01:49:09,440
As you heard from Brian Wilson, we are at a cusp of starting up the expansion project.

1177
01:49:09,920 --> 01:49:14,440
So there's additional A staff requested for operations and maintenance.

1178
01:49:14,980 --> 01:49:20,860
That's required for the startup long term and sustainable operation of RP-5 expansion.

1179
01:49:20,860 --> 01:49:25,640
As Brian mentioned, this is our largest capital project at $450 million.

1180
01:49:26,500 --> 01:49:32,840
This project will accommodate the additional flow that's projected to be coming from our

1181
01:49:32,840 --> 01:49:38,220
customer agency in the next few years due to the growth in our service area.

1182
01:49:38,920 --> 01:49:44,600
This project will allow the agency to continue to receive wastewater and treat it to a very

1183
01:49:44,600 --> 01:49:53,020
high-quality standard using file member reactor technology. Further, the agency is required

1184
01:49:53,020 --> 01:49:59,960
to relocate from regional plan number two, RP-2, because we actually don't want-

1185
01:50:00,000 --> 01:50:29,620
That facility. We're actually on Army Corps engineers' property. And as some of you may know, Army Corps is raising the Prado Dam at this point. And once that Prado Dam is raised, RP2 will be in the inundation zone. So we have to move out of there. And so another part of the RP5 expansion is to construct the solid process facility. So that includes digesters and other dewatering

1186
01:50:29,620 --> 01:50:34,060
facility, and that's also part of the expansion project.

1187
01:50:34,280 --> 01:50:38,000
Question. So you just said that the Army Corps of Engineers is going to increase that the

1188
01:50:38,000 --> 01:50:44,880
amount of water in it, which is going to cause an increase in some expenses here, right?

1189
01:50:45,960 --> 01:50:47,300
Costs, is that what I've heard?

1190
01:50:47,320 --> 01:50:48,160
They're going to move plants.

1191
01:50:48,840 --> 01:50:51,820
Because basically in blood playing, one they raised the down.

1192
01:50:52,960 --> 01:50:54,740
It's a 50 plus right in it.

1193
01:50:54,940 --> 01:50:58,560
Was it a plantation, what do they call it, the Indonesian area when they built it?

1194
01:50:58,560 --> 01:51:00,420
No, it wasn't.

1195
01:51:01,060 --> 01:51:06,060
So the government goes in and changes, the federal government goes in and changes what they're

1196
01:51:06,060 --> 01:51:06,360
doing.

1197
01:51:07,180 --> 01:51:12,900
And now are they giving us any, they're providing any funding for that?

1198
01:51:14,680 --> 01:51:15,980
I'll start, Mayor Veltza.

1199
01:51:16,020 --> 01:51:19,600
Randy has a lot of background on this as well, but the answer is no.

1200
01:51:20,280 --> 01:51:26,240
It's been known for a long time through the main stem project, which is actually a flood

1201
01:51:26,240 --> 01:51:30,000
control project from County of Orange, partnering with the Army Corps of Engineers.

1202
01:51:30,680 --> 01:51:36,340
So we have been aware of this for a number of years, but not when that RP-2 plant was

1203
01:51:36,340 --> 01:51:36,620
built.

1204
01:51:37,100 --> 01:51:37,660
That's the difference.

1205
01:51:38,320 --> 01:51:43,120
So we've known for a few decades that we were going to eventually have to move this facility.

1206
01:51:43,440 --> 01:51:45,880
They've given us a significant amount of time to plan for it.

1207
01:51:46,640 --> 01:51:53,220
Lucky for us, we, and there's a lot of credit that goes to the IUA team over the last ten years

1208
01:51:53,220 --> 01:51:59,060
of they've really maintained that plant enough to keep it online until we can move that solid

1209
01:51:59,060 --> 01:52:03,220
treatment over to RP5. So we've been really strategic about that.

1210
01:52:03,620 --> 01:52:07,940
No, I appreciate it. I know as anybody, we've got the federal government said, hey, have

1211
01:52:07,940 --> 01:52:14,480
we done that at a curiosity or not? We have had discussions with them a long time ago in terms

1212
01:52:14,480 --> 01:52:20,680
of what the terms are of these us moving, but ultimately we've known about this for a long time.

1213
01:52:20,680 --> 01:52:24,960
But we have not gone back recently and said you you have a responsibility to do this.

1214
01:52:25,600 --> 01:52:33,620
It's not in our we never are there at least the China-based municipal water district originally built this plan never owned to that land.

1215
01:52:33,620 --> 01:52:35,440
It's always been owned by the federal government.

1216
01:52:37,080 --> 01:52:41,140
I think the actually that plan was acquired when we were formed.

1217
01:52:41,460 --> 01:52:43,600
So we actually purchased it from the city of Chino.

1218
01:52:43,600 --> 01:52:43,660
No.

1219
01:52:45,000 --> 01:52:46,160
First the plan.

1220
01:52:46,160 --> 01:52:46,900
The plan went off the land.

1221
01:52:47,120 --> 01:52:47,360
You're right.

1222
01:52:47,620 --> 01:52:47,720
Yes.

1223
01:52:48,320 --> 01:52:48,920
They own the land.

1224
01:52:49,700 --> 01:52:50,380
Who's the team?

1225
01:52:50,620 --> 01:52:52,520
That was 19.

1226
01:52:52,780 --> 01:52:53,040
I know.

1227
01:52:53,120 --> 01:52:53,460
I'm just thinking.

1228
01:52:54,100 --> 01:52:54,500
70.

1229
01:52:54,660 --> 01:52:55,060
I was around.

1230
01:52:56,080 --> 01:52:57,860
I also just in this break.

1231
01:52:57,860 --> 01:52:59,320
I just want to give a clarification.

1232
01:52:59,880 --> 01:53:06,560
Randy gave the right number in terms of what our total head count would be if we were, um,

1233
01:53:06,800 --> 01:53:08,020
had filled all our positions.

1234
01:53:08,020 --> 01:53:15,040
But the question I heard, Randy, was what is our current staffing level, and that's 322 full-time equivalents.

1235
01:53:16,400 --> 01:53:22,780
Just to put that in perspective, 20 years ago our head count at that time was 308.

1236
01:53:23,760 --> 01:53:27,420
That was a 2005 head count number for this agency.

1237
01:53:28,440 --> 01:53:31,700
I have another question in regards to the employment question.

1238
01:53:32,540 --> 01:53:36,240
So are any of these 20 and employees going to be working on the Chino Basin project?

1239
01:53:40,390 --> 01:53:47,530
No, this is all specific to RP-5 expansion as well as other capital improvements.

1240
01:53:54,360 --> 01:53:58,280
So obviously it's going to open up later zero operations.

1241
01:53:59,000 --> 01:54:02,700
So you're looking at hiring eight operators in maintenance over two years.

1242
01:54:03,240 --> 01:54:06,740
Are you going to hire, are you projecting to hire more people after that operators after that?

1243
01:54:06,860 --> 01:54:13,620
Or this is what the eight is going to be the, what's needed to operate?

1244
01:54:13,620 --> 01:54:20,220
fully 100% of that the RP5 facility. This is it. This is it. So for this here, for next year,

1245
01:54:20,340 --> 01:54:29,180
you had full staffing to operate it. And then any of the staff in coming from RP2, does RP2

1246
01:54:29,180 --> 01:54:35,860
have any staffing operators there or no? Well, the after this two years, I don't know if you're

1247
01:54:35,860 --> 01:54:40,500
where RP-1 also has a major solace expansion project.

1248
01:54:41,020 --> 01:54:45,160
Okay, so that staff who's currently stationed at RP-2

1249
01:54:45,160 --> 01:54:48,120
will move to RP-1, once that's,

1250
01:54:48,280 --> 01:54:50,360
we're actually right in middle construction right now.

1251
01:54:50,760 --> 01:54:52,620
So by that time, that project will be done,

1252
01:54:52,900 --> 01:54:55,440
and those staff will be shifted over there.

1253
01:54:55,820 --> 01:54:58,880
Okay, and as far as the engineers, the six engineers,

1254
01:55:17,820 --> 01:55:30,280
We've identified over $1.5 billion worth of work. Want to go back to the discussion we had about analysis, our technical resources group did in terms of evaluating risk, ultimately, with a priority of public health.

1255
01:55:30,280 --> 01:55:33,760
public health protection, closely followed by environmental protection.

1256
01:55:33,900 --> 01:55:38,220
We've got to make sure we build the projects that we have the resources to do.

1257
01:55:38,940 --> 01:55:45,260
Our initial estimate on what we needed to spend the next two years was just under a half billion dollars.

1258
01:55:46,040 --> 01:55:50,380
With the resources we have today, we cannot complete those projects.

1259
01:55:50,880 --> 01:55:58,540
Even with these six additional engineers, the best we can do is about $150 million of those projects in each year.

1260
01:55:58,540 --> 01:56:16,400
So that's where we really balanced what do we need and what do we actually have the resources to do we continue to utilize a significant amount of external help to do this but ultimately we don't want to just push those projects through without a proper way to manage and implement them.

1261
01:56:17,080 --> 01:56:27,260
And so ultimately what we decided is to get what we need to done these are the amount of staff that we need to be able to support our mission for the next two years.

1262
01:56:27,260 --> 01:56:33,200
It's all again related to wastewater. The six engineers needed all wastewater capital projects.

1263
01:56:34,600 --> 01:56:35,300
Yes.

1264
01:56:39,230 --> 01:56:39,790
Okay.

1265
01:56:42,440 --> 01:56:47,140
Okay. Brandy. That took care of my second point right there. The third

1266
01:56:47,140 --> 01:56:53,720
point is long-term water and wastewater resources planning. This effort is to ensure long-term

1267
01:56:53,720 --> 01:56:58,660
planning and management of water and wastewater resources to meet future demands and regulatory

1268
01:56:58,660 --> 01:57:05,220
regulatory requirements. Another aspect of this is keep track of emerging environmental

1269
01:57:05,220 --> 01:57:11,020
regulations and participating, anticipating the formation of new regulation to ensure

1270
01:57:11,020 --> 01:57:17,000
agencies' perspective are heard and considered regulation and compliance are getting tougher

1271
01:57:17,000 --> 01:57:23,800
not easier. Testing to meet the latest requirements are becoming more expensive. Not too long ago,

1272
01:57:23,800 --> 01:57:27,140
So we were testing constituents in terms of parts per million.

1273
01:57:27,800 --> 01:57:32,640
Nowadays we're required to test in terms of parts per trillion, such as PFAS.

1274
01:57:34,880 --> 01:57:41,860
And the regulation we're referring to include PFAS regulation, microplastic, or an other

1275
01:57:41,860 --> 01:57:48,180
chemical of emerging concerns, and also other air-related emission regulations.

1276
01:57:49,680 --> 01:57:58,220
On cyber security and emergency preparedness and safety, staff is proposing additional staff

1277
01:57:58,220 --> 01:58:02,880
to ensure our cyber security is secured.

1278
01:58:03,300 --> 01:58:08,500
As you aware, agency provides essential public service, utilizing a lot of informational

1279
01:58:08,500 --> 01:58:14,500
and operational technology to cost effectively operate our treatment plants, including wastewater

1280
01:58:14,500 --> 01:58:17,540
treatment plants, pump stations, reservoirs.

1281
01:58:17,540 --> 01:58:21,280
And all these infrastructure has to be working at all at the same time.

1282
01:58:21,920 --> 01:58:27,260
And these are all, most majority of the time are non-man.

1283
01:58:28,300 --> 01:58:33,340
So a lot of times, most of the time, we rely on technology to operate these facilities.

1284
01:58:34,040 --> 01:58:39,700
So as you can see, this makes agency a prime target for cybersecurity threats.

1285
01:58:39,700 --> 01:58:47,460
The cybersecurity threats to public agency, such as IUA is well known, nation-wide, and

1286
01:58:47,460 --> 01:58:55,260
so agencies committed to protecting these investment by maturing our cybersecurity and emergency

1287
01:58:55,260 --> 01:59:00,520
management program and proactively assessing our vulnerability and devalue comprehensive

1288
01:59:00,520 --> 01:59:04,340
preparedness and minimize service interruptions.

1289
01:59:05,160 --> 01:59:11,000
Further, we want to ensure our employee safety as our top priority, making sure that we

1290
01:59:11,000 --> 01:59:16,620
have a top safety program, and we're protecting our employees and make a safety part of

1291
01:59:16,620 --> 01:59:23,380
our culture, and we want to make this investment in key safety personnel in order to do that.

1292
01:59:25,500 --> 01:59:31,780
Finally, workforce development and business continuity, we're investing in workforce development

1293
01:59:31,780 --> 01:59:37,680
by creating opportunities for advancement, fostering a culture that promotes excellence,

1294
01:59:38,260 --> 01:59:45,140
collaborations, and innovation to attract and retain competencies needed to meet agency objectives

1295
01:59:45,140 --> 01:59:52,880
and retain top talent. With existing staffing level, agency just can achieve that. Additionally,

1296
01:59:53,400 --> 01:59:59,300
ensuring financial resources are managed efficiently, effectively, maintain a balanced budget.

1297
02:00:00,000 --> 02:00:06,980
Timely produce a complex financial report to me funding agency requirements and bond covenants,

1298
02:00:07,440 --> 02:00:13,880
and ensuring long-term financial health of the agency. That's on staffing.

1299
02:00:15,920 --> 02:00:18,420
And here is a chart of.

1300
02:00:18,420 --> 02:00:23,620
That's not a curiosity, Savagio, and you told us that you have like 30 vacant positions.

1301
02:00:24,280 --> 02:00:28,320
Why aren't you hiring on those instead of creating 28 new ones?

1302
02:00:30,220 --> 02:00:33,380
When we have vacancies, it's not the same group of positions.

1303
02:00:33,440 --> 02:00:39,340
It's just the regular attrition, retirements, resignations that most organizations have.

1304
02:00:39,500 --> 02:00:45,240
So currently we have about an 8% vacancy rate, but that's not attributed to one department

1305
02:00:45,240 --> 02:00:46,920
or one set of positions.

1306
02:00:47,980 --> 02:00:54,300
If an engineer retires has a new opportunity, they go, that's part of the vacancy, and then we feel bad.

1307
02:00:55,140 --> 02:01:00,920
So it's not, I guess my main point is, it's not just specific to one group.

1308
02:01:01,560 --> 02:01:05,200
It's just the normal way of operating the organization.

1309
02:01:08,180 --> 02:01:10,620
I don't like to catch you off guard.

1310
02:01:10,620 --> 02:01:18,000
So I think the story would be better for me if I could get how many people are in each of these

1311
02:01:18,000 --> 02:01:23,860
departments if I could get that information. Also, I see technical information and it's hard

1312
02:01:23,860 --> 02:01:29,760
for me to believe that we're going to hire three cybersecurity people. Usually that's outsourced

1313
02:01:29,760 --> 02:01:35,160
or you get one but to say we need three. So I know that these are just examples but it would be great

1314
02:01:35,160 --> 02:01:41,500
to have a greater understanding, so I understand the challenges you guys or these departments are facing.

1315
02:01:42,300 --> 02:01:48,500
Director Reid, two responses to that. We had the summary before that identifies the current departments,

1316
02:01:49,060 --> 02:01:54,580
so I just want to understand what you're asking for. And the second point is these positions,

1317
02:01:55,240 --> 02:02:01,020
the themes that Randy had presented are really what guide us in recommending this staff increase.

1318
02:02:01,020 --> 02:02:07,100
And for example, creating, if we have that many more capital improvement projects, we need

1319
02:02:07,100 --> 02:02:11,580
engineers, we need operators who feed their input into the capital improvement.

1320
02:02:11,740 --> 02:02:17,080
We need administrative support from IT, from finance to carry this out.

1321
02:02:17,240 --> 02:02:21,980
So I wouldn't look at those numbers and say, is that position directly to cybersecurity?

1322
02:02:22,440 --> 02:02:26,200
It's a collection of staff that are needed to address those areas.

1323
02:02:26,200 --> 02:02:36,260
I understand, and we won't get in here, but, you know, you know, so the force is how many more drops and how many more computers are you applying?

1324
02:02:36,580 --> 02:02:40,060
You know, you're hiring 30 people. We need three more IT for those 30 people.

1325
02:02:40,060 --> 02:02:45,820
Or it's just another computer on another Ethernet line getting information. So you already have the support.

1326
02:02:45,940 --> 02:02:51,660
So I just want to have a greater understanding of the three. And imagine it's not here, like you said, you're doing themes.

1327
02:02:51,660 --> 02:02:58,980
So I just understand it because three IT people and when I see the increase, you know, I'm

1328
02:02:58,980 --> 02:03:01,100
trying to understand what's driving that.

1329
02:03:01,920 --> 02:03:08,420
And I want to also add, we have an IT group that includes operational technology as well

1330
02:03:08,420 --> 02:03:10,200
as business technology.

1331
02:03:10,680 --> 02:03:15,800
It's a conversation, actually, you and I have had, it's a very unique, but very efficient

1332
02:03:15,800 --> 02:03:18,020
way of handling how we manage.

1333
02:03:18,020 --> 02:03:27,580
So we will contend we have less staff for the size of the organization and the size of our operation

1334
02:03:29,340 --> 02:03:34,000
because we're able to overlap and backfill on each one of those areas.

1335
02:03:34,760 --> 02:03:39,860
So I just want to point that out this is not an IT group in the conventional sense of

1336
02:03:39,860 --> 02:03:42,960
providing business support. It also includes process control.

1337
02:03:43,220 --> 02:03:47,520
Right. And that's what I will look at in the next slide. I'll ask for some

1338
02:03:48,020 --> 02:03:57,800
When we start looking at this is, you know, when we're looking at changes and that's what I would wish we would add in the next slide, like this one right here.

1339
02:03:58,500 --> 02:04:10,260
You know, also there's a steep increase and it'd be great if we could overlie CPI ETI and then EDU is on top of this.

1340
02:04:10,260 --> 02:04:16,920
to tell a story of is the increase in dollars amount driven by CPI or EDI or is it driven in the

1341
02:04:16,920 --> 02:04:26,000
amount that we have more EDU's coming in. So the steep climb in 22 through 26 reflects an

1342
02:04:26,000 --> 02:04:31,060
increase in what we're processing. Therefore, because we're processing more, we need more

1343
02:04:31,060 --> 02:04:39,640
financial people. I want to see what has changed in the last years to create the need for increase

1344
02:04:39,640 --> 02:04:45,120
in these departments. I can understand operation and maintenance and I can understand an engineering

1345
02:04:45,120 --> 02:04:50,840
because I learned an engineering when someone says you asked an engineering department

1346
02:04:50,840 --> 02:04:58,200
how well they're doing. They'll tell you how much they spent and it's not bad. It's because

1347
02:04:58,200 --> 02:04:59,920
spent is the work you've done.

1348
02:05:00,140 --> 02:05:28,440
In other words, a good engineer department, if they're closing out jobs, they're spending money. So they're doing a great job, as Savaji says, if I don't have an engineer, we can't, or you can say close out, close out that. So I understand that the first half is just the second half I'm trying to understand the story. And I think those functions of CPI, EPI, and EDU's, are layered on top of this would try to explain.

1349
02:05:28,440 --> 02:05:36,020
And 21, 22 through 26, you know, often it's flat and then it climbs, so I'm trying to understand that story.

1350
02:05:36,840 --> 02:05:44,820
I understand the request for a story directoried, and I would suggest that a few other factors really play into this.

1351
02:05:45,340 --> 02:05:47,160
Growth is one of those that you mentioned.

1352
02:05:48,020 --> 02:05:52,960
The significant one is deferred investment in the infrastructure.

1353
02:05:52,960 --> 02:06:00,020
And if we showed the capital improvement program over the last 20 years, what it reflects was

1354
02:06:00,020 --> 02:06:06,500
a very big significant change over the past few years in recognizing things are failing.

1355
02:06:06,780 --> 02:06:08,220
They're reaching the end of their useful life.

1356
02:06:09,020 --> 02:06:13,520
And the rate models that we've been using are to essentially pay as you go.

1357
02:06:13,920 --> 02:06:18,960
And so we're at a point now where without that infrastructure we're going to be seeing more

1358
02:06:18,960 --> 02:06:25,100
more breaks, more spills, and costing more because we don't plan out these construction

1359
02:06:25,100 --> 02:06:27,360
projects, but we do them in an emergency fashion.

1360
02:06:28,500 --> 02:06:36,780
So in terms of the story, it's really a combination of growth, additional regulations, and a deferred

1361
02:06:36,780 --> 02:06:39,000
investment in the IEWA facilities.

1362
02:06:42,740 --> 02:06:43,460
Thank you.

1363
02:06:43,620 --> 02:06:50,860
So when I look at this chart, just out of curiosity, I plugged in 350 times, I was thinking average

1364
02:06:50,860 --> 02:06:57,760
salary of, say, 120 a year and that plus benefits or whatever, my calculation came out to

1365
02:06:57,760 --> 02:07:04,960
like $44 million and here you guys got $90 million. I mean, what is our base salary here?

1366
02:07:05,160 --> 02:07:11,780
I mean, it's got to be huge. This is way beyond the scope of this review. If you want to run for

1367
02:07:11,780 --> 02:07:17,980
our board, you should run against Paul over next time. But to, no, I'm serious because it's

1368
02:07:17,980 --> 02:07:21,720
We're trying to micromanage our salaries are published.

1369
02:07:21,980 --> 02:07:23,920
If you want to know what people make at this agency,

1370
02:07:24,460 --> 02:07:26,360
go to Transparent California, seriously.

1371
02:07:27,400 --> 02:07:29,300
This is, it is what it is.

1372
02:07:29,560 --> 02:07:32,900
I mean, that, you know, we have a $400 million budget.

1373
02:07:33,380 --> 02:07:37,300
We have a hundred and, I see 500 million capital projects

1374
02:07:37,300 --> 02:07:40,220
this year, including, by the way, the regional plan five

1375
02:07:40,220 --> 02:07:42,320
that we spent a bazillion years talking about,

1376
02:07:42,320 --> 02:07:46,300
which is for growth in your city and Kurt City, mostly, right?

1377
02:07:46,300 --> 02:07:53,700
So that all these other people voted for so this is micromanaging our board will ask the questions about

1378
02:07:53,700 --> 02:08:00,400
The 28 new employees. This is being provided as information for the policy committee members. It's not

1379
02:08:00,400 --> 02:08:09,340
Fair in my you're you're being insulting to elected officials at this agency. Yes, Steve people the same people elected Steve

1380
02:08:09,340 --> 02:08:10,580
I want to speak now

1381
02:08:11,340 --> 02:08:15,220
You're not the only elected official at this table. There's Randall

1382
02:08:15,800 --> 02:08:23,300
There's Kurt, there's our chair, Bill, Bill, and Deborah.

1383
02:08:23,980 --> 02:08:26,100
And we're all lucky by people too.

1384
02:08:26,760 --> 02:08:29,480
And we have the responsibility to collect the sewer money.

1385
02:08:30,120 --> 02:08:32,640
We have the responsibility to put the bills out there.

1386
02:08:33,380 --> 02:08:35,880
And when the voters or the rate fairs see this,

1387
02:08:36,380 --> 02:08:37,260
who they come first?

1388
02:08:37,380 --> 02:08:39,840
Do they come to you, Steve, or to your board of colleagues?

1389
02:08:40,360 --> 02:08:41,660
Or do they come to see us?

1390
02:08:42,180 --> 02:08:43,220
They'll come to see us.

1391
02:08:43,220 --> 02:08:50,480
Here's the issue here. The issue here is there's high cost going up. Not to rush

1392
02:08:50,480 --> 02:08:57,220
note it is, I heard the presentation. Same time there is a 9% increase, 18% in the

1393
02:08:57,220 --> 02:09:03,080
next two years being asked for which is very high. After you just had 7% and 6%

1394
02:09:03,080 --> 02:09:11,200
the last two years. So the issue here is there is no fee study we've seen. Now

1395
02:09:11,200 --> 02:09:16,120
I had an email to Shabazi and he gave me his rationale and he explained it just now, but

1396
02:09:16,120 --> 02:09:20,100
we don't have a feast day, which I assume the feast day may have a lot of information

1397
02:09:20,100 --> 02:09:22,080
that we're asking for right now, but we don't have a cockpit.

1398
02:09:23,020 --> 02:09:30,720
So we're being asked, I realize as a recommendation to your board, we're being asked to look at

1399
02:09:30,720 --> 02:09:36,440
this and make a recommendation that the impacts are repairs in our communities.

1400
02:09:37,380 --> 02:09:42,500
So, the past has been easy to do because the rate increase has been a lot smaller.

1401
02:09:43,080 --> 02:09:47,840
Obviously, the last two was because inflation was a big problem.

1402
02:09:48,400 --> 02:09:53,360
But now, we're going to have to take on a big cost.

1403
02:09:53,680 --> 02:09:54,800
And so, we need to understand.

1404
02:09:55,000 --> 02:09:59,880
We have responsibilities here to our citizens, to understand what's been presented here.

1405
02:10:00,000 --> 02:10:29,320
So we can give you guys a recommendation, and then when our citizens come talk to us, we can explain to them what our position was, how we vote it, what our recommendation was, and why. That's what we're trying to do here. So the other big issue here is the Latino Basin program. And, you know, there's a lot of questions about the Latino Basin program. And is it in the waste capital? There's a question about planning and, you know, but there's a grant.

1406
02:10:29,320 --> 02:10:35,240
and then there's a question but you know waste water capital fund and I realize we're in a time

1407
02:10:35,240 --> 02:10:40,660
here we don't have a time. So my question to you right now is the schedule. The schedule I

1408
02:10:40,660 --> 02:10:46,940
understand is this will go to the LUA board next month at your April 10 meeting. We meet on April

1409
02:10:46,940 --> 02:10:54,940
3rd so is that a hard date or could we do we have more time get the fee study but I see the fee study

1410
02:10:56,640 --> 02:11:02,200
is there more time? Does it have to go to the IE board in April 10 or could that be delayed

1411
02:11:02,200 --> 02:11:09,300
a month to May? I guess my question. Mayor Dutray, a couple of responses. One, we work backwards

1412
02:11:09,300 --> 02:11:17,100
working with your staff in terms of a prop to 18 schedule. And so the, based on that, a board

1413
02:11:17,100 --> 02:11:24,640
action by IEWA in mid-April works for all our seven customer agencies. So yes, we want to

1414
02:11:24,640 --> 02:11:32,000
shoot for that date for the approval. The point of today, introducing all of this, we don't have

1415
02:11:32,000 --> 02:11:38,260
a rate study yet. We're going to prepare a draft rate study, but it's to get the input from the

1416
02:11:38,260 --> 02:11:47,080
entire policy committee. We're here to listen today and provide the feedback. I'm just going to

1417
02:11:47,080 --> 02:11:51,060
for the EDU's. I'm uncomfortable based on the information I have here, based on these cost,

1418
02:11:52,020 --> 02:11:56,240
based on the CBP, I'm uncomfortable with information, so I can't support it right now.

1419
02:11:56,940 --> 02:11:59,980
Let's see what happens next month, but that's my position. Thank you.

1420
02:12:02,900 --> 02:12:07,400
You want to finish up? Sure. Okay. All right. I'm my last slide.

1421
02:12:09,220 --> 02:12:15,380
But before I end, I want to give you a perspective of how our monthly EDU compared to our peers

1422
02:12:15,380 --> 02:12:21,840
in the industry. So I have selected a similar wastewater, wastewater and

1423
02:12:21,840 --> 02:12:26,620
recycled water agency for this comparison. And they are Eastern Municipal Water

1424
02:12:26,620 --> 02:12:32,240
District, Las Virgines, and Western, which are shown on the last three columns

1425
02:12:32,240 --> 02:12:38,800
here. Just a little bit of background of these three agency and why I think they're

1426
02:12:38,800 --> 02:12:44,180
fair comparison. Eastern Municipal Water District is located in the inland and

1427
02:12:44,180 --> 02:12:50,600
part area. They're located in the western portion of Riverside County and also part of San

1428
02:12:50,600 --> 02:12:57,120
Diego County, Northern San Diego County, covering about 682 square miles. They provide services

1429
02:12:57,120 --> 02:13:05,860
to just under a million residents. We provide services to 935,000 so very close. They are

1430
02:13:05,860 --> 02:13:08,420
Their service area includes Merino Valley, Paris,

1431
02:13:09,220 --> 02:13:12,020
Mendeffy, Sun City, Hemant, Parts of America,

1432
02:13:12,760 --> 02:13:13,660
and Tamacula.

1433
02:13:14,380 --> 02:13:17,000
And they currently treat about 49 million gallons

1434
02:13:17,000 --> 02:13:18,400
per day of wastewater.

1435
02:13:19,100 --> 02:13:20,700
And we treat right around 52.

1436
02:13:21,120 --> 02:13:24,040
So it's also a very similar amount of wastewater day tree.

1437
02:13:24,820 --> 02:13:25,820
Next one is Western.

1438
02:13:26,140 --> 02:13:29,200
Western is also located in the Empire area.

1439
02:13:29,740 --> 02:13:34,040
They're located in Western portion of Riverside County.

1440
02:13:34,040 --> 02:13:39,340
and they're actually right next to each other. Eastern and Western are right next to each other.

1441
02:13:39,540 --> 02:13:46,920
They also provide about just under a million residents of their service. And their service area

1442
02:13:46,920 --> 02:13:55,400
includes Rupa Valley, Norco, Corona, Tamasco Valley, Lake Alcinoir, Waldemar, and parts of Canyon Lake,

1443
02:13:55,920 --> 02:14:01,940
and Marietta and Tamancola. Last one is Las Virgines. They are located in Western portion of

1444
02:14:01,940 --> 02:14:07,280
County and they're a bit smaller than IUA Western and now there's three of us.

1445
02:14:07,460 --> 02:14:14,460
They provide services to 75,000 residents in Western portion of LA County, including

1446
02:14:14,460 --> 02:14:21,960
Aguera Hills, Calabases, Hidden Hills, West Lake Village, and on corporate areas of LA County.

1447
02:14:22,860 --> 02:14:29,480
Just like IUA, they are members of the Metropolitan Municipal Water District. Just like IUA,

1448
02:14:29,480 --> 02:14:33,460
they provide water, waste water, and recycle water services to their residents.

1449
02:14:34,200 --> 02:14:40,280
Where we differ is that we provide only wholesale services, where they provide both retail

1450
02:14:40,280 --> 02:14:41,080
and wholesale.

1451
02:14:42,000 --> 02:14:52,400
So for fair comparison, the monthly sewer rate services fee, we added IUAs and the retail

1452
02:14:52,400 --> 02:14:58,400
customers fee to demonstrate what a resident will see on their monthly bills.

1453
02:14:58,400 --> 02:14:59,920
So that would be a fair-

1454
02:15:00,000 --> 02:15:08,100
Comparison to Eastern, Las Virgines and Western. So here in the chart for Western, their monthly

1455
02:15:08,100 --> 02:15:19,800
EDU rate is at $41.83. For Las Virgines, they are at $73.37. Western is at $79.96.

1456
02:15:20,960 --> 02:15:28,220
IUA's wholesale is at what we're proposing for next year is $27.02. So if we add the

1457
02:15:28,220 --> 02:15:38,160
the local retail agencies service fee, the IRA residents will see anywhere between $33.71

1458
02:15:38,160 --> 02:15:54,080
to $45.60. As you can see, IRA's residents overall sewer service fee is very much in line with industry peers and in line with other agency within the Inland Empire area.

1459
02:15:55,080 --> 02:15:59,080
There's another example in the Inland Empire area, which is Rialto.

1460
02:15:59,760 --> 02:16:03,220
Their monthly service fee is $67.14.

1461
02:16:04,260 --> 02:16:07,700
Another example for wholesale is Orange County Water District.

1462
02:16:08,400 --> 02:16:10,740
They're very much like IUA, they're wholesale level.

1463
02:16:11,340 --> 02:16:13,880
Their monthly edU rate is $30.92.

1464
02:16:14,620 --> 02:16:15,180
Oh, sorry.

1465
02:16:17,960 --> 02:16:20,040
Yes, sorry.

1466
02:16:20,560 --> 02:16:22,140
Orange County sanitation district.

1467
02:16:22,140 --> 02:16:31,740
$32.92. We are at $27.02 per month. And that concludes my presentation.

1468
02:16:32,840 --> 02:16:35,440
All right. Thank you.

1469
02:16:35,680 --> 02:16:38,020
Thank you. There may be a few more comments.

1470
02:16:38,220 --> 02:16:38,820
I'll hold on. I'm ready.

1471
02:16:39,440 --> 02:16:40,540
Thank you.

1472
02:16:41,000 --> 02:16:41,420
Yes.

1473
02:16:42,100 --> 02:16:42,380
Thank you.

1474
02:16:42,380 --> 02:16:44,440
I wanted to say something.

1475
02:16:44,760 --> 02:16:48,600
I would, again, I'm the new guy here.

1476
02:16:48,600 --> 02:16:56,000
and I sat down with our staff member, our director of public works, to try to decipher

1477
02:16:56,000 --> 02:17:02,100
this huge packet and really understand what these rates were because I had a lot of

1478
02:17:02,100 --> 02:17:09,480
additional questions myself that many of you have already asked, but there's still a lot

1479
02:17:09,480 --> 02:17:12,320
of questions that I have regarding this.

1480
02:17:12,900 --> 02:17:17,900
With respect to the board, I just a couple of questions, would you mind if my public work

1481
02:17:17,900 --> 02:17:23,400
Director came up and just asked a couple questions. I promise it will be quick. But would

1482
02:17:23,400 --> 02:17:28,340
you mind, Agent, would you come up please? Because there are some specific questions that

1483
02:17:28,340 --> 02:17:35,500
I have in my mind that could impact our community. Can you grab the mic? Thank you very much.

1484
02:17:35,620 --> 02:17:42,140
I appreciate it. Thank you very much. Thank you for the opportunity. It's just, I just

1485
02:17:42,140 --> 02:17:45,020
I just made some notes as I was listening to the presentation.

1486
02:17:46,440 --> 02:17:55,080
Here's some questions that I wanted to pose on the slide 19.

1487
02:17:55,980 --> 02:18:01,540
There's $89.2 million bond in 2627.

1488
02:18:02,140 --> 02:18:03,920
Do you know what that will be used for?

1489
02:18:09,030 --> 02:18:11,530
So what's the bond being used for? She's asking.

1490
02:18:12,830 --> 02:18:14,530
We've got to look at this, sorry.

1491
02:18:18,430 --> 02:18:18,770
819.

1492
02:18:19,090 --> 02:18:19,470
Go ahead, Alex.

1493
02:18:19,750 --> 02:18:20,070
Thank you.

1494
02:18:20,410 --> 02:18:21,570
They'll say it a lot better.

1495
02:18:21,810 --> 02:18:21,890
Yeah.

1496
02:18:22,230 --> 02:18:23,810
The revenue one, the 89 million.

1497
02:18:23,910 --> 02:18:24,030
Right.

1498
02:18:24,210 --> 02:18:39,950
That's just an estimated, estimated financing that we'll be using because if you look at the capital projects for a, we're spending 26 million or 25 million, 2526 and 30 million in 2627.

1499
02:18:39,950 --> 02:18:43,110
That's not being supported by the EDU rate.

1500
02:18:44,110 --> 02:18:44,690
Thanks, Alex.

1501
02:18:44,690 --> 02:18:58,270
Alex, a couple of clarifications, this is our treasure, Alex Lopez, and what he's pointing out would be this would be the borrowing amount that year to start supporting the capital improvement projects that would need to be funded beyond this point.

1502
02:18:58,850 --> 02:19:01,930
It does not mean we are spending that $89 million.

1503
02:19:02,490 --> 02:19:02,790
Thank you.

1504
02:19:03,890 --> 02:19:05,450
I appreciate that.

1505
02:19:05,450 --> 02:19:12,650
We asked how much money we have collected so far for the connection fees and Chino have

1506
02:19:12,650 --> 02:19:15,530
so far collected about $22 million in sewer connection.

1507
02:19:16,270 --> 02:19:20,170
And so far, apparently, we have not been called to pay yet.

1508
02:19:20,730 --> 02:19:24,370
So I was wondering how often are you a call for that?

1509
02:19:25,050 --> 02:19:29,270
By the way, the total we learned yesterday is $152 million for all the agencies.

1510
02:19:29,570 --> 02:19:30,990
We asked that question as well.

1511
02:19:30,990 --> 02:19:38,970
Yes. And then what can that money be used for? If can that be money be used for supplementing some of the increases that we're proposing?

1512
02:19:41,870 --> 02:19:51,950
Those funds are identified in our regional contract as well as our ordinance and they're very specific to both related.

1513
02:19:52,830 --> 02:19:53,430
Sorry.

1514
02:20:06,840 --> 02:20:12,220
So, yeah, those are specific to wastewater related growth projects. Thank you.

1515
02:20:13,320 --> 02:20:19,600
So, expansion of capacity, primarily because it's a connection fees.

1516
02:20:22,220 --> 02:20:27,940
To my regional contract expert, Ken, can you help clarify? Because I want to make sure I get this one correct.

1517
02:20:27,940 --> 02:20:28,380
Yeah,

1518
02:20:33,400 --> 02:20:36,980
that's correct for expansion of the system.

1519
02:20:37,380 --> 02:20:37,660
Thank you.

1520
02:20:38,000 --> 02:20:38,040
Correct.

1521
02:20:38,260 --> 02:20:38,600
Okay.

1522
02:20:38,680 --> 02:20:40,760
So it could be used for IP 5 beyond it too.

1523
02:20:41,580 --> 02:20:41,680
Yeah.

1524
02:20:41,860 --> 02:20:42,020
Okay.

1525
02:20:44,550 --> 02:20:53,150
Another one is the proposed property tax transfer in and out from recycled water and water resources.

1526
02:20:54,050 --> 02:21:01,850
Is the property tax a right source of funding for Chino Basin plant early design?

1527
02:21:02,570 --> 02:21:10,250
I don't know what will be an allowable use of the property taxes, and I'm just inquiring

1528
02:21:10,250 --> 02:21:16,430
to see whether, again, can that be utilized to help reduce the increase?

1529
02:21:18,610 --> 02:21:23,790
The answer is yes, and as you can see as an example in recycled water, we had shifted

1530
02:21:23,790 --> 02:21:31,670
adjusted our recommended property tax allocation to help reduce the overall rate increase.

1531
02:21:32,590 --> 02:21:38,870
So in concept agent, the answer is yes, but just, yeah, I guess that's it.

1532
02:21:39,910 --> 02:21:40,110
Okay.

1533
02:21:40,930 --> 02:21:45,690
For all of those, your staff and our staff work great together.

1534
02:21:46,350 --> 02:21:51,870
You guys always have a lot of answers for all the questions we have, so I think we appreciate

1535
02:21:51,870 --> 02:21:57,910
the collaboration and I think we continue to want to work collaboratively to find solutions.

1536
02:21:58,670 --> 02:22:02,990
Thank you. Same. Appreciate the comment. And I do have one more question. What percent of

1537
02:22:02,990 --> 02:22:05,610
property taxes are you a receive from the county?

1538
02:22:09,220 --> 02:22:14,140
We don't receive a set percentage but it's an

1539
02:22:14,140 --> 02:22:20,060
adjustment that takes place every year based on total assessed valuation. But I'm going to look at

1540
02:22:20,060 --> 02:22:23,800
and Alex for this, there's not a percentage we rely on, right?

1541
02:22:24,320 --> 02:22:26,360
Or is there a rough estimate that you can provide?

1542
02:22:29,090 --> 02:22:29,190
Okay.

1543
02:22:30,090 --> 02:22:31,770
One percent of the deal, okay.

1544
02:22:32,390 --> 02:22:34,490
One percent of the total then, correct?

1545
02:22:35,230 --> 02:22:38,190
I thought he just said 2.8, what did you say?

1546
02:22:38,750 --> 02:22:43,130
That was a property tax allocation once we get the money and how we allocate it between

1547
02:22:43,130 --> 02:22:44,050
our different operations.

1548
02:22:44,450 --> 02:22:49,310
What Alex is answering is, of the property tax the county collects, how much comes to

1549
02:22:49,310 --> 02:22:55,750
you weigh. Currently it's about $90 million. It's $90 million. I told us about E-D-E-D last.

1550
02:22:56,010 --> 02:22:57,450
Thank you. $1 per hundred.

1551
02:23:00,470 --> 02:23:06,110
Thank you. Shavajee, thank you. Thank you, Borg, for allowing me to do this. It really helps

1552
02:23:06,110 --> 02:23:08,730
me out to understand it. Thank you very much. Thank you.

1553
02:23:09,110 --> 02:23:18,290
Just real quick, if I think what helped me to, if I could get 10 years of E-D-Us,

1554
02:23:19,310 --> 02:23:26,310
And if you could put down a graph along with the, like I said, 10 years of the cost of

1555
02:23:26,310 --> 02:23:33,550
EDUs and then the amount of EDUs, so when I went, when I say the amount, the number

1556
02:23:34,110 --> 02:23:38,490
of EDUs total, that would give me an idea of how this is being divided up.

1557
02:23:38,650 --> 02:23:45,370
And then, and if I could get a 10 year salaries of, and if you could cross-reference that to

1558
02:23:45,370 --> 02:23:48,270
CPI and EPI. That would be great.

1559
02:23:51,150 --> 02:23:56,230
On that, another thing that comes up is, you know,

1560
02:23:56,370 --> 02:24:02,530
I see MEEUs, and those are very important because we buy, we purchase a lot of water.

1561
02:24:03,470 --> 02:24:09,810
And of course, this is sewage, but I see it brought it up. And I know some people, other

1562
02:24:09,810 --> 02:24:16,850
other people on this board, except for one, you know, is because of Montclair and Montclar

1563
02:24:16,850 --> 02:24:21,030
City and Montavista, you know, when the sewer windows the water.

1564
02:24:21,610 --> 02:24:30,930
I'd be interested in further talks of busing out services, you know, services such as most

1565
02:24:30,930 --> 02:24:37,790
some of us have our own type of schools and training in those type of things, as far as

1566
02:24:37,790 --> 02:24:44,630
water awareness or education, you know, if we could start looking at, you know, what

1567
02:24:44,630 --> 02:24:49,250
part of that MEU goes toward those type of programs that would help.

1568
02:24:50,070 --> 02:24:55,130
And then, of course, I'm always worrying about when I brought up the numbers, the number

1569
02:24:55,130 --> 02:24:59,870
of people working on planning and then just accounting for the water.

1570
02:25:00,000 --> 02:25:28,840
You know, I want to have a greater understanding, because when I left here, there was only two people doing planning. And they took care of it all. And so I know since we've gone to an interview with that, there's a lot more going on, and I just want to have a greater understanding of the increase in manpower for that. So thank you. Director Rita, I want to address those four points. The ten years of EDU is something that we will provide.

1571
02:25:28,840 --> 02:25:37,220
the policy committee. The second request seems a bit more challenging in terms of—I would

1572
02:25:37,220 --> 02:25:45,700
need some clarity on what that means in terms of payroll expenses. I prefer to follow up with

1573
02:25:45,700 --> 02:25:53,320
step. I imagine it's a line out of your burden rate for what you're paying, you know, as far as

1574
02:25:53,320 --> 02:25:59,120
operational costs, you know, for salaries, just, you know, what are the salaries and what

1575
02:25:59,120 --> 02:26:04,660
have those been over the 10 years as far as increases in that, you know, as far as increases

1576
02:26:04,660 --> 02:26:09,720
in it because I think there's, like you said, you had a couple of years where there was

1577
02:26:09,720 --> 02:26:15,240
an increase, because you honored some COVID, so I just want to have an idea of, you know,

1578
02:26:15,400 --> 02:26:20,860
those the increases you've gone with, with your different bargaining units, what those have,

1579
02:26:20,860 --> 02:26:23,480
those type of increases in salary.

1580
02:26:25,660 --> 02:26:27,920
I was still struggling with that recommendation.

1581
02:26:28,180 --> 02:26:31,300
We have a total payroll expense that we shared.

1582
02:26:31,720 --> 02:26:39,040
I think that reflects it, but what I'm hearing is the MOU salary increases based on cost

1583
02:26:39,040 --> 02:26:39,520
of living.

1584
02:26:39,760 --> 02:26:45,340
Your salary matrix, what have over the years, over the last ten years, what have you given

1585
02:26:45,340 --> 02:26:54,540
and to compete with CPI as far as that would give me a better understanding of that.

1586
02:26:54,720 --> 02:26:57,440
Let us give some thought to that to find a way to present.

1587
02:26:58,080 --> 02:27:01,340
When it comes, and I'm going to separate the conversation from MU,

1588
02:27:01,560 --> 02:27:05,100
but I heard you clearly in terms of workforce development and training.

1589
02:27:05,560 --> 02:27:12,080
And if it's related to wastewater, we can bring back not related to this rate study,

1590
02:27:12,080 --> 02:27:17,260
just our efforts in trying to continue improving that, especially from a regional standpoint.

1591
02:27:17,720 --> 02:27:19,340
So we're happy to do that.

1592
02:27:21,480 --> 02:27:26,960
And I got lost because I'm used to a balance sheet where I have revenue and expenses, and

1593
02:27:26,960 --> 02:27:27,640
this is the net.

1594
02:27:27,840 --> 02:27:32,980
So in other words, our revenues meeting our expenses, and if someone could maybe in the next slide

1595
02:27:32,980 --> 02:27:39,300
say, here's what our expenses are going to be, and this is the revenue, and we're going

1596
02:27:39,300 --> 02:27:44,820
to barely make it or we actually have a knit, that type of thing, that would be a better

1597
02:27:45,400 --> 02:27:45,920
understanding.

1598
02:27:46,380 --> 02:27:50,700
And right now we just use a different term for that expenses and that's revenue requirements

1599
02:27:50,700 --> 02:27:53,040
but essentially this is the balance sheet approach.

1600
02:27:53,160 --> 02:27:53,440
Thank you.

1601
02:27:53,760 --> 02:27:53,800
Yeah.

1602
02:27:54,460 --> 02:27:54,700
Thank you.

1603
02:27:55,060 --> 02:27:55,280
Okay.

1604
02:27:55,920 --> 02:28:03,600
I just make a recommendation that maybe IUA send out an email to the agencies asking if

1605
02:28:03,600 --> 02:28:09,680
any specific questions they may have. I get a lot of, I get my, everything I need to

1606
02:28:09,680 --> 02:28:14,540
learn and understand comes from my staff. So I'm hearing a lot of stuff here that,

1607
02:28:15,060 --> 02:28:18,580
and questions for this, questions for that. And, I mean, you get the information back

1608
02:28:18,580 --> 02:28:23,480
and what is that going to change? You know, the, the facts of the facts, and I think staff,

1609
02:28:23,920 --> 02:28:28,600
if we could email out to the staff that they have questions to our technical review people,

1610
02:28:30,000 --> 02:28:38,180
Public Works Directors and allow them to, if they have questions, to feed them back because they're going to obviously share with me what their concerns are.

1611
02:28:40,840 --> 02:28:46,460
Again, getting into the weeds sometimes it seems and are we really going to get the answers that we need to make the decision?

1612
02:28:48,080 --> 02:28:57,220
I may not have the same questions that Randy has so having to send all the same information out to everybody when maybe it's just important to Randy, may not be as important to me.

1613
02:28:57,220 --> 02:28:59,960
So I'd like to see, maybe is that possible to be done?

1614
02:29:00,500 --> 02:29:02,300
Mayor Velt, we will do that.

1615
02:29:02,680 --> 02:29:06,140
We've already unofficially started receiving

1616
02:29:06,140 --> 02:29:09,580
and soliciting questions from the customer agencies.

1617
02:29:10,400 --> 02:29:13,800
One thing I do want to close at least my comments with is

1618
02:29:14,720 --> 02:29:19,280
we very much take to heart what Mayor Dutre said about having to defend

1619
02:29:19,280 --> 02:29:21,540
the inclusion of our rates and your own rates.

1620
02:29:21,880 --> 02:29:24,520
And I've been directed and

1621
02:29:24,520 --> 02:29:31,480
And myself, as well as my staffs, definitely support this by policy member Eli as well as

1622
02:29:31,480 --> 02:29:36,880
our board to make ourselves available for any of your governing boards to provide backup.

1623
02:29:37,160 --> 02:29:40,880
Because we know it's hard to defend what we're recommending, especially when you're not

1624
02:29:40,880 --> 02:29:42,180
working in that field.

1625
02:29:42,380 --> 02:29:48,320
So at any of those public meetings or if you need IEWA support, we're happy to be there.

1626
02:29:48,760 --> 02:29:53,240
I think most recently I attended Montclair City Council just to talk about a general IEWA

1627
02:29:53,240 --> 02:29:58,800
update, but we're very happy to do that in coordination with your staff to present the

1628
02:29:58,800 --> 02:29:59,820
justification for these.

1629
02:30:00,000 --> 02:30:21,740
And I think that'll set a lot of, you know, at ease, maybe that way there are questions that you have to have maybe a lot different than my staff may have. Same with John, same with Phil and all across this board here rather than debating it up here and challenging staff at this meeting. And I think that kind of puts a little bit of a dampener on the right in front of the lot of your staff. And I'm not comfortable myself.

1630
02:30:24,720 --> 02:30:28,620
The timing of our email will be good. I think most are listening right now.

1631
02:30:28,620 --> 02:30:35,120
But Randy reminded me that on March 12th we have our customer rates meeting so that'll be one week or one week from yesterday

1632
02:30:35,560 --> 02:30:39,020
And I would encourage you all to get together with your staffs

1633
02:30:39,440 --> 02:30:44,120
Between now and then and figure out what the questions are from both of you, right? I mean

1634
02:30:44,540 --> 02:30:44,940
If

1635
02:30:46,100 --> 02:30:48,500
To me, it's not a good answer to say I

1636
02:30:49,320 --> 02:30:53,780
Don't like it. Well, okay, but why and what's what do you need? What don't you have? What doesn't you staff have for you?

1637
02:30:53,980 --> 02:30:58,220
We're talking 9% sounds like a lot. Nobody wants the raise rates. Remember

1638
02:30:58,620 --> 02:31:05,040
that this agency jeopardized its credit rating in 2010 by holding rates at that time during a recession

1639
02:31:05,040 --> 02:31:11,660
to protect the public. We did the same thing during the beginning of COVID. We held the line,

1640
02:31:11,700 --> 02:31:16,720
we didn't raise rates for a year, even though our staff pushed us to do it. So our board is willing

1641
02:31:16,720 --> 02:31:23,980
to listen, but it's not going to be a free fall and come into our business. It's how can you be

1642
02:31:23,980 --> 02:31:29,660
helpful and how can you you know because we were elected by the people just like all of you were

1643
02:31:30,380 --> 02:31:34,700
and we have a responsibility for the region as a whole nine hundred thirty five thousand people

1644
02:31:34,700 --> 02:31:39,700
that we serve and we're leaders in the state and we provide each and every one of your agencies

1645
02:31:40,300 --> 02:31:45,900
a lot of support including you know when there's problems when there's issues training

1646
02:31:47,240 --> 02:31:52,560
everything comes through here because our staff are the experts in the wastewater field

1647
02:31:52,560 --> 02:31:57,040
And I think that gets lost sometimes at these policy committee meetings.

1648
02:31:57,540 --> 02:32:06,160
I would really, it would be more constructive if we had genuine questions like Agent just asked that are universal.

1649
02:32:06,620 --> 02:32:11,620
Then to berate our staff or to tell them, you're not giving me what you what I want.

1650
02:32:11,980 --> 02:32:14,760
They work for us, they don't work for anybody else.

1651
02:32:14,760 --> 02:32:20,360
A quick question, Savaji, to a team vote.

1652
02:32:20,980 --> 02:32:21,080
Yes.

1653
02:32:21,200 --> 02:32:26,160
The timing, the answer to one of the questions had to do with our two 18 vote, so things can

1654
02:32:26,160 --> 02:32:26,580
be approved.

1655
02:32:27,480 --> 02:32:32,940
So this is a two year plan, and two years will we, again, have to go out for a two 18 vote

1656
02:32:33,380 --> 02:32:36,760
with the next cycle instead of five years or whatever it might have been.

1657
02:32:37,460 --> 02:32:42,280
That's an individual customer agency decision in terms of what assumptions you want to make.

1658
02:32:42,280 --> 02:32:47,800
make sometimes agencies will go out with just assuming that the rate is going to be X amount

1659
02:32:47,800 --> 02:32:53,500
and it stays within that, but that's a decision on your part. I will say an unfortunate

1660
02:32:53,500 --> 02:33:00,740
wasn't here last month, but I heard the questions about the impacts to 2018 and why we're going

1661
02:33:00,740 --> 02:33:05,960
from five to two, that's an impact. I'll just share that if we did have to, there was

1662
02:33:05,960 --> 02:33:10,480
a reason we didn't want to recommend a five-year rate, we'd have to build in a lot of conservatism

1663
02:33:10,480 --> 02:33:15,360
to that. And because of that, those rate increases would look significantly higher than what we'd

1664
02:33:15,360 --> 02:33:19,280
want to recommend. And that's why we thought it was more fiscally prudent to do it in two years,

1665
02:33:19,440 --> 02:33:25,980
even if it creates an additional notification responsibility by customer agencies. But we really

1666
02:33:25,980 --> 02:33:32,360
didn't want to come in. If we had to do five years, the numbers would look higher than what we would expect.

1667
02:33:37,720 --> 02:33:38,200
Okay.

1668
02:33:41,190 --> 02:33:43,030
Anything else? All right.

1669
02:33:44,790 --> 02:33:49,930
You know, today wouldn't have been so bad if that darn rate study would have been available

1670
02:33:49,930 --> 02:33:54,390
to us two weeks ago, so that we could have gone through it and asked the questions that

1671
02:33:54,390 --> 02:34:01,190
we would have had or not had. So that's number one. We all want transparency. I think we all

1672
02:34:01,190 --> 02:34:08,970
want to get along, but because of lack of information, it just gets really hard, and I really

1673
02:34:08,970 --> 02:34:14,450
get frustrated with the fact that because we have to pass through these costs, that our

1674
02:34:14,450 --> 02:34:19,410
residents are the ones standing at the podium saying, we can afford it, seniors can't afford

1675
02:34:19,410 --> 02:34:24,570
it, this can't afford it, gosh and darn it, I mean I would love you if I knew the residents

1676
02:34:24,570 --> 02:34:28,810
were going to come out for you to come and sit there and listen to them, but like we have

1677
02:34:28,810 --> 02:34:31,030
to listen to them when we pass through these costs.

1678
02:34:31,350 --> 02:34:34,870
I don't know if there's enough time for 218, you know,

1679
02:34:34,950 --> 02:34:37,050
by the first week of April rolls around.

1680
02:34:37,150 --> 02:34:38,930
I don't know how that works.

1681
02:34:39,950 --> 02:34:41,250
You know, the PowerPoint was great,

1682
02:34:41,390 --> 02:34:43,770
but I don't, again, have the rate setting in front of me,

1683
02:34:43,850 --> 02:34:47,450
so I can't really justify any of the stuff that's going on.

1684
02:34:48,650 --> 02:34:50,350
Again, when I did some quick calculations

1685
02:34:50,350 --> 02:34:54,850
on your $90 million of salaries that's looking

1686
02:34:54,850 --> 02:34:58,510
like your people are making over $257,000

1687
02:34:58,510 --> 02:34:58,890
a year.

1688
02:34:59,190 --> 02:34:59,230
So.

1689
02:35:00,000 --> 02:35:27,060
I mean, because I don't have that kind of stuff in front of me, I can't really guess it and I don't think Randall's asking for too much when he asked for that. Again, the Tino Basin Project, are any of the costs for that Tino Basin Project being included in that 9% this year and the 9% the next year? You know, you've always told us 20 million times that those of us that don't want to participate in the Tino Basin Project don't have to participate in it. And therefore, we don't have to share into those costs.

1690
02:35:27,540 --> 02:35:34,980
So, you know, that's what's frustrating, and so any of the wastewater capital being transferred

1691
02:35:34,980 --> 02:35:38,700
into the Chino Basin Project and planning, I don't know.

1692
02:35:39,320 --> 02:35:44,220
You know, so it's just because we have all these questions, and if you guys just help us

1693
02:35:44,220 --> 02:35:50,680
by providing that rate study and just helping us and answer the questions nicely, I feel sometimes

1694
02:35:50,680 --> 02:36:09,040
So I'm being talked down to over here, it's just, you know, and that's big just because I don't have the knowledge and I want to be able to pass that knowledge on to my residents and Steve, I talked to my water staff probably twice a month to try to understand everything that's going on here.

1695
02:36:09,040 --> 02:36:13,160
So, that's why too, and I had the lot of an extra position.

1696
02:36:13,640 --> 02:36:17,880
I didn't sit there because I let Scott Burton sit there for a reason.

1697
02:36:18,660 --> 02:36:22,320
You know, so that's why, you know, question darn it.

1698
02:36:22,460 --> 02:36:26,520
I just, this is all about trying to do the right thing by the taxpayers.

1699
02:36:27,260 --> 02:36:31,240
We all are municipal agencies and we all are responsible to the taxpayers.

1700
02:36:31,820 --> 02:36:36,340
We're not a private sector thing where we have a board and stockholders that want to make

1701
02:36:37,320 --> 02:36:37,760
money.

1702
02:36:37,760 --> 02:36:42,020
we want to break even we want to be able to pay for things we want to be able to pay good wages

1703
02:36:42,540 --> 02:36:47,900
just find sometimes this whole I mean we don't do this at the water facilities but we don't do

1704
02:36:47,900 --> 02:36:52,160
this at the desolter we don't do this at any of our other water meetings this is the only water

1705
02:36:52,160 --> 02:36:59,780
meeting that gets contentious and I don't get it so that's my two cents okay thank you anybody

1706
02:37:00,780 --> 02:37:05,200
well gentlemen it's been a fun sitting up here with you all night uh so this is my standing on

1707
02:37:05,200 --> 02:37:08,700
on this whole thing. And I understand where you're coming from because it is frustrating when

1708
02:37:08,700 --> 02:37:11,940
you're looking at other people's books that are not your own to try to decipher what's going

1709
02:37:11,940 --> 02:37:17,000
on to figure out if there is something that we're missing on our side, right? There is that section

1710
02:37:17,000 --> 02:37:20,440
of having the contract and trying to actually have good faith in one another to make sure that you

1711
02:37:20,440 --> 02:37:24,180
guys are going to be representing our residents well. The same time I understand we have Fontana

1712
02:37:24,180 --> 02:37:28,780
has our own elected member that's their job, right? And it's their job to represent my residents,

1713
02:37:29,000 --> 02:37:32,140
but it's also as a contract holder, it's my job to go and back that up and say,

1714
02:37:32,600 --> 02:37:35,860
As the city of Fontana, this is the best contract we have.

1715
02:37:36,340 --> 02:37:38,260
And when your contract is not the best contract we have,

1716
02:37:38,520 --> 02:37:41,140
city of Fontana will take back over our sewer, and we will leave.

1717
02:37:41,940 --> 02:37:44,100
But right now, you guys are the best option we have.

1718
02:37:44,220 --> 02:37:44,740
I ran the numbers.

1719
02:37:45,220 --> 02:37:46,100
I can't do it for cheaper.

1720
02:37:46,660 --> 02:37:49,040
It's going to cost me a lot more in the long run.

1721
02:37:49,500 --> 02:37:50,280
So we stay on the board.

1722
02:37:50,980 --> 02:37:52,880
And as long as you guys can promise that you guys are going to give us

1723
02:37:52,880 --> 02:37:54,960
the best rates on it, Fontana is going to stay.

1724
02:37:55,900 --> 02:37:57,900
And trust me, I don't think you guys are going to,

1725
02:37:57,960 --> 02:37:59,900
I don't think I can do for cheaper at this point.

1726
02:37:59,900 --> 02:38:04,320
and we looked at a couple of years ago, it's not going to change. So I appreciate what you guys

1727
02:38:04,320 --> 02:38:09,900
are doing. As far as your guys' employee payroll, I get, we got a lot of employees and we got to

1728
02:38:09,900 --> 02:38:13,300
do a bunch of payroll increases here going up and we're in the middle of a bunch of contracts. So

1729
02:38:14,000 --> 02:38:17,540
your guys is what you guys take care of when your employees is up to you guys. I'm not going to get

1730
02:38:17,540 --> 02:38:21,300
in the middle of it as long as you guys are paying them livable wages and they're not complaining to me.

1731
02:38:22,180 --> 02:38:26,160
I don't care. It's your guys' budget at the end of the day. But at the same time, you guys have to

1732
02:38:26,160 --> 02:38:30,600
answer the residents and so do we. And so just make sure the contract's good for me and that's all I appreciate.

1733
02:38:32,280 --> 02:38:33,440
All right. Thank you.

1734
02:38:37,190 --> 02:38:42,290
Third, as an action. Am I correct? That's correct. Great. Thank you.

1735
02:38:43,090 --> 02:38:44,090
You're good. A lot.

1736
02:38:44,290 --> 02:38:44,430
You're good.

1737
02:38:44,750 --> 02:38:50,030
It's one with one quickly. And I understand a level of frustration is the timing. That's what this has

1738
02:38:50,030 --> 02:38:54,170
all been about. It's about timing. And so when you put staffs in the cities under the, you know,

1739
02:38:54,170 --> 02:38:56,530
with everything that's going on right now,

1740
02:38:56,650 --> 02:38:58,570
that's where that level of frustration comes from

1741
02:38:58,570 --> 02:39:02,050
because there's so much going on in these cities.

1742
02:39:03,270 --> 02:39:04,910
And under the gun get it done.

1743
02:39:05,050 --> 02:39:06,810
So that's probably the level of frustration

1744
02:39:06,810 --> 02:39:08,470
where I know we're hearing from our staff also.

1745
02:39:08,590 --> 02:39:09,790
So I wanna make sure that that's understood

1746
02:39:10,210 --> 02:39:12,830
and I don't wanna see staff get beat up anymore

1747
02:39:13,310 --> 02:39:15,350
because we gotta get answers, they gotta get answers.

1748
02:39:16,250 --> 02:39:17,830
And so we just wanna make sure it's collaboration,

1749
02:39:18,290 --> 02:39:20,830
it's open dialogue and everybody's talking each other

1750
02:39:20,830 --> 02:39:23,070
and we won't have this contentious relationships

1751
02:39:23,070 --> 02:39:33,090
set this at these meetings. Thank you. We're good aren't we? Let's then we'll move on to do we have

1752
02:39:33,090 --> 02:39:40,410
any comments from Roger? Do you have any additional comments to share? I had a presentation ready but

1753
02:39:40,410 --> 02:39:46,450
I'll skip it today. Yeah I kind of figured yeah that's where I'm hesitating here. How about we've

1754
02:39:46,450 --> 02:39:54,130
already talked about future agenda items which is focus of what tonight was. Do we have any additional

1755
02:39:54,350 --> 02:39:59,650
committee comments, committee member comments that have nothing to do with this presentation.

1756
02:40:01,870 --> 02:40:07,190
Good. Well, I've got something to go to also. So our next meeting is April 3.

1757
02:40:10,010 --> 02:40:10,490
Let's