5.21.19 Meeting Summary

Last night there were three significant items discussed:

• As the sewer system of Clayton flows through the sewer system of Concord, we discussed a rate increase of $45 per year for each of the next four years to cover increased cost of operations and maintenance in parity with increases that have just been adopted at Concord.  These charges are collected through property taxes.  Because we contract with the City of Concord, Clayton is obligated to pay the increased sewer charges to the City of Concord regardless of whether the rates to homeowners is adjusted or not.  As seen in the next item, the City's budget surplus is sufficiently tight that this would not be possible to absorb without significantly reducing services.  The Council ultimately approved the increase by a vote of 4-1 with Councilmember Diaz opposed.  

• We discussed the FY20 budget and went over the key revenue and expenditure categories. This year's budget reflects an overall tighter operating surplus of approximately $40K. The general fund budget reflects expenditures of just south of $4.8M, half of which is related to our police force which has been relatively consistent year over year.

• After the last meeting regarding the small cell wireless ordinance (for 5G), I posed several questions, observations, and requests which were included in the agenda packet.  Staff took time to do research and addressed each of these, incorporating my suggested changes into the ordinance that was approved last night.

More detailed thoughts below:

Clayton has a long standing agreement that the city will pay an amount per single family home equal to what the Concord pays per single family home.  Because Concord raised its rates in response to increasing charges from Central Contra Costa Sanitary District, Clayton is obligated to pay Concord this amount regardless if we chose to raise the amounts property owners are assessed.  The city budget could not support absorbing this cost.

Unfortunately we don't have many options on the sewer charges. We're not large enough to maintain all the main lines so we contract out with Concord. Since they are effectively the only game in town, we don't have alternatives to their services. They in turn contract out portions as well. It's certain that the rates will rise over time due to inflation, maintenance, etc.

My overall concern was whether the overall increases were reasonable. Using single family homes as a proxy, Clayton has approximately 10% of the housing units that Concord has.  Based on the flat nature of the charge (an amount per property), this inherently has proportionality built in.  One way there could be uneveness in the charges is if one city had a disproportionate amount of volume as compared to the total number of properties.  Unfortunately there is no measurement as to the amount of volume that originates from Clayton that travels through Concord's sewer lines so this evaluation could not be made.

I did ask about historical rate increases and it appeared that this amount was fairly consistent year over year, and is expected to continue for the next several years beyond the current four year time frame.