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associated with the local collection system is managed by the City and is the subject of the rate review by HDR and this rate increase. City's Sewer Collection System The City maintains and operates a sewer collection system. The City's above ground wastewater system includes 13 sewer pump stations. The below - ground sewer assets consist of both gravity and force mains ranging in pipe diameter from 2 to 42 inches and the below - ground sewer assets include approximately 270 miles of pipe of which a majority was installed between 1980 and 1990. A majority of the sewer mains are vitrified clay pipe and are smaller than 12 inches in diameter. Local sewer service charges are developed to equitably allocate costs to users for asset operation, pay for debt service incurred for the construction of sewer facilities, and to perform the necessary maintenance and repairs (or replacement) of the wastewater collection system. The costs also include the labor and pumping charges associated with the collection and pumping of raw sewer to the DSRSD and /or City of Livermore treatment plants. The local portion of the current City rates represents approximately 36% of the overall bi- monthly sewer bill. Audit/Review of Expenditures and Cost of Service Increases Just as experienced in the Water Fund, the City's costs have increased in the Sewer Fund since the 2010 study. Staff started the review by auditing the City's Utility Billing records and found some billing inconsistencies that are proposed to be corrected in this rate study. In addition, Staff was able to reduce costs prior to developing the expenditures for the rate study and as a result of this the City is able to limit the rate increase to 3% at this time. Senior and Low Income Discounts The City is proposing to reduce the current 20% discount on water rates for single family residents who qualify as a "senior" (age 65 or older) to 15 %, and continue to provide a 30% discount for residents who qualify as a low income family (those who qualify for PG &E, PacBell, or cable television discounts through either the California Department of Economic Opportunity or the Social Security Administration). Residents cannot apply for both discounts. The City also currently limits both programs to a discount only if the water customer's bi- monthly water consumption is less than or equal to 40 CCF. The proposed rate program will continue these programs at these recommended levels. Proposed Rates The table below presents the current bi- monthly local sewer bill and the proposed rates by customer classification as of October 15, 2015: Page 13 of 18