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18 <br /> THE CITY OF <br /> I <br /> CITY COUNCIL AGENDA REPORT <br /> PLEASANTOK <br /> December 6, 2022 <br /> Operations Services <br /> TITLE: PRESENTATION BY ZONE 7 WATER AGENCY ON WATER SUPPLY <br /> STUDY UPDATE AND PROPOSED WHOLESALE WATER RATES, AND <br /> ADOPT RESOLUTION TO PASS-THROUGH ZONE 7 RATE INCREASES <br /> FOR CALENDAR YEARS 2023, 2024, 2025 AND 2026 <br /> SUMMARY <br /> Zone 7 Water Agency is the City's wholesale water provider. The Zone 7 water rate is <br /> provided to the City and is a direct pass-through to the City's customers. Government <br /> Code §53756 (AB 3030 [2008]) permits the City to automatically pass-through Zone 7's <br /> water rates. The setting of this rate is not within the control of the City and is subject to <br /> change at the beginning of each year. On November 16, 2022, the Zone 7 Water <br /> Agency Board of Directors approved multi-year wholesale treated water rate increases; <br /> these approved revenue rate adjustments are 5.5 percent per calendar year for the next <br /> four years commencing on February 1, 2023. <br /> The current Zone 7 rate for Pleasanton customers is $3.61 per Hundred Cubic Feet <br /> (CcF). This is a blended rate of the Zone 7 fixed and variable rates for the City, with <br /> 42.5 percent of Zone 7 costs fixed for Fiscal Year 2022. A summary of the impact of the <br /> Zone 7 rates to Pleasanton residential rate payers is noted: <br /> Bi-Monthly Increase to Customer (Residential) <br /> 2022 2023 Difference % Increase <br /> 10 CcF $56.03 $59.23 $3.20 5.71% <br /> 20 CcF $92.13 $98.53 $6.40 6.95% <br /> 30 CcF $132.16 $141.76 $9.60 7.26% <br /> At the City Council meeting, Zone 7 General Manager Valerie Pryor will present an <br /> overview of Zone 7's budget, water rates and water supply. <br /> RECOMMENDATION <br /> Receive presentation from Zone 7 General Manager and adopt the attached resolution <br /> to approve the pass-through of Zone 7's water rates. <br /> FINANCIAL STATEMENT <br /> If Zone 7 water rate increases are approved, there will be cost increases to every <br /> resident and business in Pleasanton. The City would realize annual water wholesale <br /> cost increases of approximately $3.4 million for water purchased starting on February 1, <br /> 2023 and the budget will be updated during the mid-year review. <br />