PUBLIC HEARING TO CONSIDER SANITARY SEWER SERVICES RATE

INCREASES FOR 5 YEARS, FISCAL YEARS 2015-2021

PUBLIC HEARING June 16, 2015

BURBANK SANITARY DISTRICT

1

BURBANK SANITARY DISTRICT

• Burbank Sanitary District (BSD) was formed in 1940

• The District serves an unincorporated pocket within City of San Jose mainly from Forest Avenue south to Parkmoor Avenue and from Bascom Avenue east to Richmond Avenue

• BSD serves approximately 1,000 properties with a population of 4,926

• The flow is conveyed to the San Jose/Santa Clara Water Pollution Control Plant (approximately 10 miles away)

2

BURBANK SANITARY DISTRICT (BSD) SERVICES

• Garbage services collection

• Street sweeping services

• Sanitary sewer collection and treatment services

3

SANITARY SERVICES

• Respond to residents’ inquiries and assist in locating cleanouts, backflow devices, and laterals

• Respond to sanitary sewer overflows/stoppages

• Maintain & repair mains and lower laterals

• Implement District capital improvement projects • Coordinate with the State Board and Federal Regulatory

Agencies • Work with City of San Jose for District’s use of the San

Jose/Santa Clara Water Pollution Control Plant

4

San Jose-Santa Clara Treatment Improvements

• Plant was constructed in the 1956, upgraded in 1964 and 1979 • Plant is undertaking a major 30-year Rehabilitation Program • Proposed Treatment Plant costs are estimated at $2.1 billion

5

Tributary Discharger % Cost Share of $1,324,640,631

City of San Jose 67.97% $900,380,034

City of Santa Clara 13.81% $182,993,139

City of Milpitas 6.93% $91,732,407

West Valley Sanitation District 6.34% $83,942,060

Cupertino Sanitary District 4.13% $54,754,366

County Sanitation District 2-3 0.58% $7,682,188

Burbank Sanitary District 0.24% $3,156,438

COST BREAKDOWN OF 10-YEAR CAPITAL IMPROVEMENTS

FOR THE TREATMENT PLANT - FY 2016 THROUGH 2025

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Discharge improvements to the Bay Digesters and bio-solid disposal

Improvements to water and air quality

Mechanical/Electrical equipment improvements 7

9

DISTRICT CIP CHRONOLOGY

10

ITEM Date Completed Condition Assessment completed initial 10 year CIP strategy

July 10, 2014

First Public Outreach presentation

November 10, 2014

Zone A additional investigation - Easement letters sent

January 9, 2015

- Field inspection

February 18, 2015

- Mapping

March 15, 2015

- Preliminary engineering

April 21, 2015

- Present CIP strategy

June 1, 2015

DISTRICT CAPITAL PROJECTS There are 3 types of rehabilitations: Zone A, Zone B, and Zone C

• Zone A (located between Scott Street and I-280) will require all sewer mains to be fully replaced. Most sewer mains are located in the backyards between two properties; therefore, they are difficult to replace. District is considering pipe busting to rehabilitate.

• Zone B is all other portions of the District north of Zone A and will require spot repairs. Sewer mains in Zone B are located in the street.

• Zone C is the potential commercial redevelopment (formally part of Zone A) that will require full sewer replacement in the backyards/alley.

ZONES A & C REHABILITATION STRATEGY

• Construction method: Pipe Bursting • Cost: $1,400,000 • Construction Implementation Strategy:

– In third year, one construction package with financing or – Staggered 3rd, 5th and 7th year, pay as you go

ZONE B REHABILITATION

• Construction methods: – Total spots to be repaired: 125

– 581 feet of pipe replacement on Cleveland Avenue

• Total cost: $1,876,000

ALTERNATIVE 1 10 YEAR CIP IMPLEMENTATION

Third Year, One construction Package for Zones A and C and finance $1,000,000

YEAR ZONE LOCATON DESCRIPTION COST

1 B Arleta Ave, Irving Ave 20 spot repairs $246,000

2 B Leland Avenue 16 spot repairs $253,000

3 A/C All Streets, includes Scott St Pipe Bursting $1,400,000

4 B Boston Avenue, Bailey Avenue 15 Spot repairs $246,000

5 B Cleveland Avenue 4 Spot repairs + Replacement

$285,000

6 B Bailey Avenue, Laswell Avenue, Richmond Avenue, Brooklyn 31 Spot repairs $330,000

7 B Rutland Avenue, Vaughn Avenue 12 Spot repairs $174,000

8 B Bascom Avenue, Wabash Avenue, Leigh Avenue 11 Spot repairs $137,000

9 B Cecil Avenue, Clifton Avenue , Raymond Avenue 9 Spot repairs $141,000

10 B Forest Avenue, Arleta Avenue 3 Spot repairs $51,000 Total Cost = $3,276,000

ALTERNATIVE 2 10 YEAR CIP IMPLEMENTATION

Zones A and C divided into 3 construction packages 3rd, 5th and 7th year.

YEAR ZONE LOCATON DESCRIPTION COST 1 B Arleta Ave, Irving Ave 20 spot repairs $246,000

2 B Leland Ave 27 spot repairs $253,000

3 A Easement between Laswell Ave and Arleta Ave, portion of easement between Arleta Ave and Raymond Ave, Scott St

1/3 Pipe Bursting $450,000

4 B Boston Ave, Bailey Ave 15 spot repairs $246,000

5 A Portion of easement between Arleta Ave and Raymond Ave, portion of easement between Raymond Ave and Irving Ave

1/3 Pipe Bursting $450,000

6 B Cleveland Ave, Brooklyn Ave 15 Spot repairs + Replacement

$449,000

7 A/C Portion of easement between Raymond Ave and Irving Ave, easement between Bascom Ave and Laswell Ave

1/3 Pipe Bursting $500,000

8 B Bailey Ave, Laswell Ave, Richmond Ave 20 Spot repairs $166,000

9 B Rutland Ave, Vaughn Ave, Bascom Ave, Wabash Ave, Leigh Ave 23 Spot repairs $301,000

10 B Cecil Ave, Clifton Ave, Raymond Ave, Forest Ave, Arleta Ave 12 Spot repairs $192,000

Total Cost = $3,276,000

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17

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$259,549.00 $270,000.00 $280,800.00 $292,032.00 $303,713.00

$246,000.00 $430,000.00 $450,000.00

$246,000.00 $400,161.00

$538,026.00

$547,697.00

$760,593.00

$552,416.00

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

PROJECTED EXPENSES FOR BSD

FY2014-15 FY 2015 - 16 FY2016 - 17 FY2017 - 18 FY2018 - 19

SJ/SC COST BSD CIP BSD O&M

ACTUAL COST

PROJECTED COST AT

END OF THIS FISCAL YEAR

FUTURE THREE YEAR PROJECTED COSTS

19

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Projected Revenue $721,700 Reserve Fund $259,333 Total Funds Required To Balance Expenses $981,033

Expenses for District’s Operations FY 2015 - 2016

Total Projected Expenses - $981,033

Revenue for District’s Operations FY 2015 - 2016

District Operation and Maintenance,

$374,005 , 38.12%

Treatment Plant Operation and Maintenance,

$212,159 , 21.63%

Treatment Plant Capital Outlay, $95,769 , 9.76%

District Capital Construction,

$246,000 , 25.08%

Joint Use (CSJ Payment),

$20,000 , 2.04%

Treatment Plant O & M Equip Repl, $1,000 ,

0.10%

Debt Related Expenses,

$32,100 , 3.27%

Permits, Fees & Misc, $3,000

, 0.31% Sewer Service

Charges, $715,700 ,

72.95%

Interest Earning,

$3,000 , 0.31%

Transfer Funds from Reserve to

Balance Expenses, $259,333 ,

26.43%

21

$516

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$531

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$549

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$576

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$622

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$303

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$245

,377

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$315

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$241

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$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

LAST FIVE YEAR COMPARISION ACTUAL REVENUES, EXPENSES AND BUDGET

Approved Budget

District CIP

SJ/SC O&M & CIP

BSD O&M

Actual Tax Roll Revenue

FY2010 - 11 FY 2011 - 12 FY2012 - 13 FY2013 - 14 FY2014 - 15 FY14-15 Estimated thru June 30, 2015

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Proposed Percentage Increase for FY 2015-16

8% 10% 8% 5% 15% 0% 4%

Santa Clara WVSD CuSD CSD 2-3 Burbank San Jose MilpitasFY 2009-10 $195.60 $279.48 $288.00 $286.00 $354.91 $334.00 $334.00FY 2010-11 $232.80 $294.48 $288.00 $315.00 $369.00 $366.00 $366.00FY 2011-12 $277.03 $311.88 $330.00 $343.32 $383.76 $372.00 $390.48FY 2012-13 $350.40 $330.60 $330.00 $429.12 $399.23 $394.32 $425.64FY 2013-14 $396.00 $363.72 $363.00 $493.49 $415.20 $405.96 $455.52FY 2014-15 $415.80 $400.08 $381.15 $542.84 $456.72 $405.96 $521.64FY 2015-16 PROPOSED $449.06 $440.09 $411.64 $569.98 $525.23 $405.96 $542.51

$0.00

$100.00

$200.00

$300.00

$400.00

$500.00

$600.00

Annu

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San Jose-Santa Clara Treatment Plant Agency Single Family Residential Rates

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RATE INCREASE NEEDED TO . . . • Continue to pay City of San Jose for the Treatment Plant cost

• Maintain current level of District operations and maintenance

• Increase BSD capital project program to be in compliance with

Sewer System Management Plan (SSMP).

• Repair infrastructure, as over 85% of the District’s sanitary sewer pipes and laterals were constructed in the 1950’s, and most pipes are beyond the expected useful life.

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Type of Services Current Rates Proposed Rates for FY 2015-2016

Residential Per Unit (Single Family/Townhouse/Condo)

$456.72/Year $38.06/Month

$525.24/Year $43.77/Month

Residential Multiple Per Unit (Duplex/Apartment)

$259.68/Year $21.64/Month

$298.68/Year $24.89/Month

Commercial Properties $3.15/HCF $327.36/Year Minimum

$3.62/HCF $376.44/Year Minimum

Restaurant $8.39/HCF $1,368.36/Year Minimum

$9.65/HCF $1,573.56/Year Minimum

Garage $3.66/HCF $1,298.64/Year Minimum

$4.21/HCF $1,493.40/Year Minimum

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Current District Rates Versus Proposed Rates

• HCF - Hundred Cubic Feet

QUESTIONS AND CONTACT INFORMATION

Questions or further suggestions please write to the District office at: 20863 Stevens Creek Blvd

Cupertino, CA 95014 Or please feel free to call us at or visit:

408-253-7863 http://www.burbanksanitary.org/

BOARD OF DIRECTORS STAFF Michelle Kaelker-Boor – President Richard K. Tanaka Keri Russo – Secretary District Manager - Engineer Rebecca Yoder – Director (Mark Thomas & Company, Inc.) Ken Colson – Director Rene Prupes – Director