BOARD AGENDA MEMORANDUM
SUBJECT:
Title
Receive Overview of the FY 2022-23 Groundwater Production Charge Setting Process and Review of the 10-Year Water Rate Projection Assumptions, and Provide Feedback.
End
RECOMMENDATION:
Recommendation
A. Receive an overview of the Fiscal Year 2022-23 Groundwater Production Charge setting process;
B. Review the 10-year Water Rate Projection Assumptions; and
C. Provide feedback.
Body
SUMMARY:
This agenda item presents the Fiscal Year (FY) 2022-23 groundwater production charge setting process and provides an update on key issues that pertain to setting the charges that would take effect July 1, 2022 (Attachment 1).
Each year, the Board establishes groundwater production charges for four zones of benefit (Zone W-2 in the North County and Zones W-5, W-7, and W-8 in the South County) in accordance with Section 26 of the District Act. Although not specified under the District Act, the Board also sets surface water charges, recycled water charges, treated water surcharges, and the amount of the State Water Project cost to be recouped through the State Water Project tax, within the framework of the groundwater charge setting process.
The Water Utility taxing and pricing policy, Resolution 99-21 (Attachment 2) and legal requirements, guide staff in the development of the overall structure for these charges.
The FY 2022-23 surface water charge setting process will be conducted consistent with Proposition 218's requirements for property-related fees for water services as detailed in Board Resolution 12-10 (Attachment 3).
Proposition 26 applies to groundwater charges. For a groundwater charge to qualify as a nontax fee under Proposition 26, it must satisfy both of the following requirements:
1. It must be no more than necessary to cover the reasonable costs of the government activity, and
2. The manner in which those costs are allocated to a payor bear a fair or reasonable relationship to the payor's burdens on, or benefi...
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