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Jocelyn Kwong From: Gerry Beaudin Sent: Friday,July 14, 2023 4:48 PM Cc: Jocelyn Kwong; Tamara Baptista; Susan Hsieh; Pamela Ott;Alexa Jeffress; Heather Tiernan Subject: Questions & Staff Responses Re. Item #18 on 7.18.2023 City Council Meeting Agenda Good afternoon, Mayor Brown and Councilmembers— This information will be available in a supplemental packet; here are the questions and staff responses to related to items on the July 18`h Council Meeting Agenda: Item#18—Receive overview of water and sewer rates and set public hearing date to consider rate increases for September 19, 2023 Q—How many water meters/accounts are in Pleasanton? Staff Response—There are approximately 22,600 accounts. Q—When the budget was completed,did we account for rate increases and are there sufficient funds to absorb the proposed rate increase (since the City is a large water consumer)? Staff Response—At the time the budget was adopted, we estimated increases of 14.9%(29.8% if it is for six months)for FY24 and 19%for FY25 for water rates.The PFAS design work/capital expenditures and the loan were not anticipated at the time. Water and recycled water costs for the General Fund will increase. Since we will be allocating a portion of the general liability insurance premium (over$300k) to the Water Fund, it will help to offset a portion of the increase.We are also planning to allocate insurance premiums to the Sewer Fund, Golf Course Fund, and other enterprise funds (part of the mid-year update).These allocations will help to offset the cost although allocations, i.e.,Storm Drain and Cemetery programs, may increase costs to the General Fund. Q—Regarding the$61VI loan (and related repayment), can explain how much of the proposed rate increase is associated with the loan and its repayment? Staff Response—The rate increases will generate an additional $38,642,626 in revenues from FY24 to FY26.The debt service associated with the proposed loan from FY24 to FY26 is$4,157,546, which is 11%of the proposed rate increase revenues. Q—How long can the water fund sustain the program without a rate increase? Staff Response—The total fund balance would be negative by FY25 without the proposed rate increases due to purchased water and capital costs. That does not account for the costs to address PFAS or the implementation of other water supply alternatives. Please let me know if you would like to discuss this further. Have a great weekend, Gerry Beaudin (He/Him) City Manager 1