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Chico council authorizes Prop. 218 notice for large sewer-rate increase after staff warns $134.5M need
Summary
After an 18-minute staff presentation and public comment, the Chico City Council approved the finance-committee recommendation (Option 1) to initiate a Proposition 218 notice setting maximum sewer rates to address a $134.5 million five-year capital-improvement plan; the substitute motion passed 4-3.
Deputy Director David Keene told the City Council the sewer enterprise faces a $134,500,000 capital improvement plan over five years and that the fund''s operating reserves are well below target, leaving the city with limited options to maintain regulatory compliance and system reliability. "We are in a position now where we need to catch up and establish a sustainable rate moving forward," Keene said during an 18-minute presentation.
The presentation outlined drivers for the work ' regulatory mandates, aging infrastructure and capacity needs ' and three cash-funded and three debt-financing scenarios staff and the finance committee reviewed. Keene said a cash-funded "Option 1" would require a large first-year increase followed by smaller annual adjustments; debt…
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