REPORT TO COUNCIL
SUBJECT
Title
Proposed Modification to the Water Rate Structure for Mobile Home Parks for Fiscal Year 2016/17
Report
BACKGROUND
As part of the annual process of reviewing the financial condition of the utility enterprise funds, staff makes recommendations to the City Council to adopt changes in utility rates. Council typically holds a public hearing in June to set the rates for the coming year. This was most recently done on June 21, 2016 and the rates became effective on July 1, 2016 for the 2016/17 Fiscal Year.
Sunnyvale utility rates are based entirely on the City's costs for operating and maintaining its water, wastewater, and solid waste facilities and services. Each of the utilities is operated as an independent enterprise, and all expenses and revenues for each service are accounted for separately from other funds.
To ensure that the utility rates are based on actual cost, staff conducts a cost of service study approximately every five years for each of the utilities. A water cost of service study was completed in FY 2015/16, with the recommendations from the study included in the proposed rates for FY 2016/17. Subsequent to noticing the June hearing, staff identified that the rates that were proposed to be charged to mobile home park owners (the City's direct customers) and those that park owners would pass on to their residents were inconsistent in that the mobile home park owners are charged a flat rate while passing on a tiered rate to residents. Staff is recommending a fix to the City's rate structure to address this issue.
Public Noticing Requirements
Sunnyvale continues to comply with the noticing provision for utility rates as required by Proposition 218 and AB 1260. To accommodate this change to the mobile home park rates, staff sent notices to the impacted customers (mobile home park managers/owners). A total of fourteen notices were sent to mobile home park managers/owners on December 16, 2016, notifying customers of the...
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