Council Updates:

Budget

General budget was approved with anticipated expenditures of $26,603,544 and revenues of $26,629,254. This shows a surplus of $25,710.
The Capital Improvement budget was approved for $943K. Expenditures approved for the next fiscal year includes:
• The long awaited Dog park In Brush Canyon 30K
• Lining of the Hidden Hills Storm Drains 200K
• Wheel Chair ramp program 50K
• Street Marking and Signs 50K
• La Palma Repairs 100K
• Park Improvements 100K
• Friends Church High School Field Lights* 250K
• Veterans Park Sport Field Lights 113K
• Master Plan of Parks 50K

*This item is our share of the funding for the joint use sport fields at the new Friends High School. We have an agreement with the school to use the fields for our sport activities when school is not in session.

Sewer System Rates

The new sewer rates were approved at the community-approved amount of $86.28 per year but the fee was set at $66.00 per year. The majority Council set the fee lower in anticipation of transferring the sewer system to the Yorba Linda Water District in the near future.
I can understand the desire to transfer the system to the water district but I disagree with this decision.
As I have stated before, the City can provide the service less expensively. Winders proposal would have taken money out the general fund to loan money to the sewer system but had a rate of return of at least 4%. This is better than the rate of return we are receiving currently @ ½% allowing the system to pay back the general fund monies used to subsidize the system. The rates would have been $50.88/ year.
Additionally, this is a possible bargaining tool we have to help negotiate land development on the largest pieces of land in the City. One of the only ways we can control density and development standards in those areas is our control of the sewer system. As our attorney stated: ”it is a small stick”. But it is a stick nonetheless.

Savi Ranch Housing Vote

During this November election, there will be a Measure B vote on the ballot to determine if you would be for or against higher density housing in Savi Ranch. We are, by law, required to provide the opportunity for developers to build higher density homes for low-income families. Savi Ranch has been identified, as one of the sites the Council felt would impact the community the least. Because we have a voter approved building ordinance in Yorba Linda, the voters have to approve the conversion of commercial property into residential in excess of 10 units per acre.
This Measure B vote does not approve any specific project. If approved, any proposed project would have to go through all City or State required planning processes, CEQA, public noticing, etc.
The benefits of this site:
• Off-loads the density numbers required by the state from predominantly the west side into an industrial area
• Help support the businesses in the Savi Ranch area increasing our sales tax revenue
• The area is lower than Yorba Linda Blvd/ Weir Canyon making the project less visible and not as intrusive
• There is a potential to incorporate a community room in the project area to allow for an extension of classes and community events to be conveniently offered to East End residents

For more information on these and other Council Actions from the July 20 Council meeting, go to: http://tinyurl.com/2f53n2w

So I am ignorant now? What is ignorant about wanting to preserve our communities resources or at least get something of value in exchange? Our sewer system is worth $9.8 M and the majority Council (Anderson, Rikel and Schwing) want to give it to the Water District for nothing. First, they devalue its worth by putting it in a negative revenue position, ignoring a voter approved 218 vote to raise the rates. Then they want to give it away. If the decision is made to give the system to the Water District, they would and should raise the rates.
It costs more than ~$20 a year to maintain the sewers. The difference is all of the Water District overhead will be calculated into their rates: new building, equipment, pensions, etc. Mr Schwing mentioned the water district is not collecting enough revenue from the west end rates to cover their costs. So what makes anyone think they would not raise the east end sewer rates?
Our City is a contract city, hiring outside contractors to do landscape and various maintenance projects, to name a couple. Our ability to provide services is generally more economical. The water district has not submitted a bid on the RFP (request for proposal) within our community for east end sewer maintenance for a while because they could not match the low bidder.
For our Mayor to say our consultants calculation on the costs to maintain the east end sewer rates is simply an accounting change is ludicrous! Because our past practice has not accurately determined the sewer maintenance costs, does not mean we should continue that practice. Currently the General Fund makes up the difference. BTW- we threw ~$30,000 away on that consultants work. Why bother to hire an expert and go out for a 218 vote if you are not willing to consider the results? And I am ignorant?

BACKGROUND

The City of Yorba Linda sewer system is divided into two separate districts with the boundary near San Antonio Road. The eastern portion of the system, about 42%, is owned and controlled by the City of Yorba Linda. The western portion, about 48%, is owned and controlled by the Yorba Linda Water District.

The City sewer system is a gravity fed system approximately 73 miles in length made up of manhole covers and connecting pipe segments.

The City of Yorba Linda, the operator of the eastern portion of the sewer system, has the right and responsibility to properly fund and maintain the eastern portion of the system. As a City provider, we are mandated to develop and fund a Sewer System Management Plan (SSMP) that prevents untreated or partially treated wastewater to be released into the waters of the United State or create a nuisance. The plan also outlines the steps to be taken if an emergency response is required to protect the public health and the environment.

We are required to perform annual inspections of the sewer system and repair any damage in compliance with the California Water Codes and Regulations.

THE ISSUE

The annual sewer fee is added to the tax bill for single-family dwellings. The western district controlled by the Yorba Linda Water District has been charged $66.00 per year per residence while the eastern district controlled by the City of Yorba Linda has been charged only $19.47 per year. The actual cost for providing the service in the east including a small reserve for repairs and emergencies was calculated to be $86.28. Currently the cost between the actual cost to provide the service and the funds collected is being taken from City General Fund at an annual cost of $500,000. This means that the western district is subsidizing the loss in the eastern district and the city is losing $500,000 per year.

The City cannot raise rates without a state mandated Proposition 218 vote where the City must ask residents for approval to raise the rates. On May 19, 2009, the City Council directed staff to proceed with the Notice of Public Hearing for a rate adjustment. Notices were sent to the affected property owners indicating the proposed rate increase. If 50% +1 of the affected property owners protested the rate increase then the rates would remain at the current level.

At a cost of $3,000 not including City staff time, the notices were sent to about 6,500 property owners. Only 37 protest votes, less than ½% were received.

The Sewer System Management Plan (SSMP), the cost to implement the program and the results of the Proposition 218 vote were presented to the City Council. At that public hearing, members of the community supported the rate increase and no member of the public spoke against the rate increase.

With only 37 protest votes received and no negative public comments, it was obvious that the community understood the value of maintaining the sewer infrastructure and was willing to pay the additional $66.81 per year to do so.

I only received one email from a former City Engineer that questioned the amount of the increase. Judging from the staff report and the consultant’s report, the rate increase was justified.

Mayor Mark Schwing, Mayor Pro Tem John Anderson and Councilwoman Nancy Rikel voted to overturn the community’s approval of the Proposition 218 Vote. Councilman Jim Winder and myself voted to increase the sewer fees as approved by the public. As a result of this decision the City’s General Fund will continue to lose $500,000 per year to make up the difference.

The reason? The majority based their decision on the % of increase rather than the actual amount of money which was reasonable and necessary to help balance the budget for the sewer system and was approved by the public.

At the last Council Meeting on October 20th, a staff report was presented to give away the sewer system owned by the City of Yorba Linda to the Yorba Linda Water District. Mayor Pro Tem John Anderson advanced this idea after he voted against the public approved increase to keep the system operating at a deficit. Giving the sewer system away had not been discussed by the entire City Council in public nor had the staff been directed to study and develop a report on this issue to be presented to the City Council.

MY CONCERNS

1. Schwing, Rikel and Anderson voted to overturn the will of the people by voting to continue operating the sewer system at a deficit of $500,000 annually.
2. The Yorba Linda Water District would like to take over the system but only if the system is given to them free of charge.
3. The sewer system has a potential value in the of millions of dollars.
4. The City Council now has asked to study this again:
   • Evaluate the value of the sewer system.
   • Determine if there are companies that would competitively bid for this system.
   • Determine what the community benefit would be to allow the Yorba Linda Water District to assume responsibility for the system. My understanding is that the Water District is planning to raise the sewer rates soon but did not want to do this so close to the large water increases imposed last September.
   • Discuss whether we can do another Proposition 218 vote this year to raise the rates to an undetermined amount at the cost of another $3,000 plus staff time.

CONCLUSION

This is frivolous, wasteful spending of taxpayer money that defies the will of the community and will continue to deplete our General Fund.