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Finance Committee Water Pollution Control Plant Residential Sewer Rates 2 March 3, 2010 ANALYSIS • Staff has reviewed the error and made the following findings: • The City Attorney confirmed that the City would be in compliance with Proposition 218 requirements if the City recovered the incremental increase of $1.31 per month for single family homes and $0.94 per month for multiple family dwellings for FY 2010 -11 during the FY 2011 -12 property tax billing cycle. • The Alameda County Tax Collector Auditor's Office - Tax Analysis division has approved use of a second line item to capture the FY 2010 -11 sewer adjustment. • If the City chooses to do nothing, then approximately $268,000 in sewer revenues would be foregone. The Summary of Residential Sewer Service Charges (Attachment A) provides the monthly sewer rates for FY 2009 -10 (base year) and the approved rates beginning FY 2010 -11 through FY 2014 -15. Using the actual number of parcels billed for the FY 2010 -11 property tax statements, revenues are calculated for each of the fiscal years, including a breakout of the new revenues attributed to the 5% annual rate increase. The chart also depicts the proposed correction to the FY 2011 -12 tax bill. Staff recommends that next year's rates be set at the pre - approved amount and that the City bill and recoup the $15 under billing from this fiscal year. RECOMMENDATION Staff recommends that the Finance Committee approve billing residents the incremental monthly increase of $1.31 for single family homes and $0.94 for multiple family dwellings for FY 2010- 11 on the Alameda County Property Tax statement for FY 2011 -12, and seeks ultimate approval from the City Council on March 21, 2011. ATTACHMENTS Attachment A - Summary of Residential Sewer Service Charges G \FinanceCommtttee120 10.11\3 -4 -11 \Staff Report-Residential Sewer Service 3 -4 -11 reVised.docx