City of Mesa PROPOSED UTILITY RATE "ADJUSTMENTS" Audit, Finance & Enterprise Committee Meeting Thu 09.10.2020

Note: The Agenda was printed 2 days before this 8 a.m. meeting yesterday - hardly enough time for the three City Council members to review and to analyze 14 pages of the prepared Committee Report or the 42-slide Presentation.
That's not even enough time for a independent qualified financial analyst to dig into all the details in the data, or for that matter in the provided Projection of the Cash Flow for the City of Mesa's Utility Enterprise Fund.
_________________________________________________________________________

Furthermore, any reasonable person is entitled to ask if the three committee members David Luna, Jennifer Duff, or Mark Freeman present any competence or qualifications from their pre-Council careers: Luna and Freeman were city employees for many years: Freeman a Fire Captain for 31 years and Luna in the city school department. Duff owned a small business that manufactures fishing lures.

For the previous three years, the issues under review now have been subjects of controversy that were raised by Mesa City member Jeremy Whittaker multiple times over and over again - his informed questions and opposition views to the status quo effectively scuttled his re-election campaign.
He was called "divisive" by the mayor in a video endorsement of his challenger (who was also endorsed and supported by Luna, Duff and Freeman in the August Primary Election.)  

Yesterday's early morning Audit, Finance & Enterprise Committee meeting called on the city's 'top guns' employed in the city manager's office (3) and the office of Management & Budget (2) to prepare the data to make the recommendations for utility rate "adjustments" for FY2021.



There is also a prepared

City of Mesa Utility Enterprise Fund Cash Flow Projection

_________________________________________________
  

Meeting Name:

Audit, Finance and Enterprise Committee

Agenda status:

Final

Meeting date/time:

9/10/2020 8:00 AM

Minutes status:

Draft

Meeting location:

Virtual Platform

File #:

20-0845

Type:

Presentation

Status:

Agenda Ready

In control:

Audit, Finance and Enterprise Committee

On agenda:

9/10/2020

Title:

Hear a presentation, discuss, and provide a recommendation on proposed utility rate adjustments.

Attachments:

1. Presentation, 2. Committee Report, 3. Attachment 1 - Utility Rate Recommendations for FY 2021, 4. Attachment 2 - City of Mesa Utility Enterprise Fund Cash Flow Projection

________________________________________________________________________
2 INSERTS: RELATED CONTENT ON MESAZONA:

18 February 2018

Audit, Finance & Enterprise Committee Meeting 21 Feb 2018

Final Agenda

21 Feb 2018 8:00 AM
Council Chambers - Lower Level


Among others, West Mesa CDC gets examined

 

 

28 March 2019

Is Mesa A Smart City with Audit, Finance & Enterprise Reports Like This???

You might have missed this - a 36-page presentation
Yeah - Let's see what's going here with  internal controls! 
Further use of audit resources is TBD – we will seek direction
NOTE: This is one item from this morning's Mesa City Council Session that probably not too many even noticed . . .
Take a look
Here it is > with link to the source

________________________________________________________________________

Here's the 42-Page Power Point Slide Presentation:
City of Mesa w FY 2020/21 Utility Rates Recommendations
Audit, Finance & Enterprise Committee
September 10, 2020

Presented by:

Brian A. Ritschel –Management & Budget Assistant Director
Jake West –Water Resources Director
Patrick Murphy –Deputy Solid Waste Director
Frank McRae –Energy Resources Director

OVERVIEW
Utility Enterprise Operations 2-7

Water and Wastewater 8-13

Solid Waste 14-18

Electric Service 19-

   Page 29 Electric System

   >> Standby Customers with on-site generation use entire electric system if their generation does not meet their energy requirements.

   >> Additionally, significant investments in the 12 kV Distribution System are required to extend service to the new developments

 

Natural Gas Service 30-37

IN THE FUTURE page 38
• Smart Meters
   • Time of Use Rates
   • Electric Vehicle Rates
 • Prepaid Electric Bills

 

Schedule for FY 2020/21 Utility Rates Adjustment Recommendation Page 39

Sep 21 – City Council Action on Notice of Intent

Oct 15  –  City Council Discussion of Utility Rates
Nov 16 –  Introduce Utility Rate Ordinances
Dec 01 –  City Council Action on Utility Rates
Jan 01 –   Effective date for Utility Rate changes

Rate Adjustment History Page 41

Rate Adjustment History Page 42

________________________________________________________________________________

Here's the 14-Page  
Audit, Finance and Enterprise Committee Report 

Date: September 10, 2020

To: Audit, Finance and Enterprise Committee
Through:
Michael Kennington, Chief Financial Officer/Deputy City Manager
Kari Kent, Assistant City Manager
John Pombier, Assistant City Manager
From:
Candace Cannistraro, Management and Budget Director 
Scott Bouchie, Environmental Management and Sustainability Director
Frank McRae, Energy Resources Director
Jake West, Water Resources Director
Subject: Fiscal Year 2020/2021 Utility Rate Recommendations 

PURPOSE AND RECOMMENDATION

The purpose of this report is to provide staff recommendations for utility rate adjustments. The rate adjustments are recommended to be effective January 1, 2021. 

The forecasted expenses for each utility are compared to the forecasted revenues based on the current rates.

The increases in annualized revenues needed to accommodate the increased costs for each utility are: 

• Utility Revenue Solid Waste $330,000
• Electric $272,000
• Natural Gas    $428,000
• Water $6,698,000
• Wastewater   $2,951,000  

The method of implementation of rate adjustments can vary from year to year based on the needs and goals of the individual utilities.

The impact on individual customers can vary based on the method of implementation and the customer consumption.

Page 2
FY 2020/2021 Utility Rate Adjustments Page 2  

For FY 2020/21, the following rate adjustments are being recommended

(see Attachment 1 for more detail): 

 

Solid Waste:
Residential barrel rates: no adjustment
Bulk item pick-up:  Increase by $1.96, from $23.04 to $25.00
Bulk Item Not Out Fee: Increase by $13.21, from $11.79 to $25.00
Front-load rates: Overall 3.5% increase
Commercial Roll-Off rates: 1.0% increase 

 

Electric:
Residential: service charge increase of $1.00 per month 
Residential: 1.0% Summer Tier 1 usage rate increase and 5.0% Winter Tier 1 and Tier 2 usage rate increase
Establish new Standby Rate Gas: Residential: service charge increase of $0.25 per month
Residential: 10.0% Summer and Winter Tier 2 usage rate increase
Non-residential: service charge increase of $2.00
Non-residential: 3.0% Summer and Winter Tier 2 usage rate increase 
Non-residential: Adjust Tier 1 usage from 0-1,200 therms to 0-1,500 therms
Establish new Economic Development Rate 

Water:

Residential: 1.50% increase to service and usage components
Non-residential: 1.50% and 5.00% increases to usage and service components, respectively, across most customer classes
Interdepartmental: no adjustment
Continue with final residential water usage tier adjustment
Continue with removal of final excess surcharge holiday
 

Wastewater:

Residential rate: 3.50% increase to service and usage components
Non-residential: 4.00% increase to service and usage components, across most customer classes
Establish Household Hazardous Waste $0.41 per month rider for Leisure World customers Interdepartmental: no adjustment