Title
Incorporated County of Los Alamos Code Ordinance No. 02-287; an Ordinance Amending Chapter 40, Article III, Sections 40-171 and 40-175 of the Code of Ordinances of the Incorporated County of Los Alamos Pertaining to Potable Water Rates and Bulk Delivery Rates
Recommended Action
I move that the Board of Public Utilities approve Incorporated County of Los Alamos Code Ordinance No. 02-287 as presented and forward to Council for adoption.
Staff Recommendation
Staff recommends the motion be passed as presented.
Body
At its regular meeting held June 15, 2016, the Los Alamos County Board of Public Utilities held preliminary discussion on the draft water rate ordinance presented here, and was briefed by staff on the budgetary and operational reasons for the proposed rate adjustment. This proposed ordinance (attachment A) is now before the Board for approval and to be forwarded to Council for adoption.
Continuing cool weather with consistent moderate rainfall has created a trend toward reduced water sales. Attachment B shows the historical consumption and the significant decline beginning in fiscal year 2014, which aligns with the noted change in weather patterns. While the DPU used to budget for 1½ percent increases each year, we are now projecting a more conservative constant annual sales quantity of 775,000 kgal, down from prior budget amounts over 880,000 kgal. Even with reduced sales, however, costs of operating and maintaining a complex water production and delivery system continue to increase. As attachment C shows, the DPU has invested almost $28 million dollars in water system repair, replacement, and improvement projects since 2003. To continue a prudent level of maintenance and replacement with current sales projections, increases in rates are necessary.
In the FY2017 budget we projected a 10 percent increase in both wholesale and retail sales rates. It was recognized during budget formulation that 10 percent may not be enough to stabilize ...
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