ACWD Moves to Finalize Fee Methodology
Following a year of analysis and hearings, the Alameda County Water District is scheduled to adopt changes to its fee methodology on Feb. 7, 2019. Under the shift, the district is scheduled to adopt a hybrid “Equity Buy-In/Incremental Cost” methodology for its new water service-related charges and fees triggering a 4 percent fee increase for residential facilities connection charges. The hike will be offset slightly by the simultaneous elimination of the district’s Facilities Reimbursement Charge (FRC) of $461 per single family dwelling unit. The FRC which was used to repay developers who constructed facilities that served customers beyond specific project borders. Factoring the FRC offset, the total connection cost per single-family dwelling unit will initially decline $186 or 2.6 percent, dropping from the current $7,323 to $7,137 starting May 1, 2019.
Under the new methodology the new water service-related charges financial program will be a structured 5-year phase-in (2019-2023) of annual fee adjustments with the single-family rate adjusting to $8,325 per dwelling unit, a hike of $1,188 or 16.6 percent over the current fee schedule. The multi-family rate is scheduled to reach $6,917 per dwelling unit, an increase of $1,059 or 18 percent compared with the current fee schedule. In addition, meter installation charges will increase between 1.9 percent and 2.2 percent starting May 1, 2019, depending on meter size.
Initially ACWD and its consultant (Raftelis) proposed a fee structure increasing to over $11,000/SFR unit vs. $8,325/SF unit and $9,300/MFR unit vs. $6,917/MFR unit thru its 5-year structured phase-in. Through the support of builders D. R. Horton, Lennar Homes and Pulte Homes the financial consultant Development Financial Advisory (DFA) joined BIA in reviewing ACWD’s data and methodology assumptions, engaged with ACWD staff and submitted summaries of findings resulting in a reduction of over $300,000 in asset valuations which significantly lowered the fee threshold supported by the agency’s documentation. BIA and DFA will continue to review documentation, as generated, in advance of the February 7, 2019 Board meeting.
For more details including rates for multi-family dwelling units, click HERE to view ACWD’s water and service related fees memo of Jan. 2, 2019. Click HERE to view ACWD consultant Raftelis’ facilities connection charges calculation methodology memo. For questions or comments, contact BIA’s Pat Sausedo at 408-294-5687 or firstname.lastname@example.org.