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Albany Council hears multi‑year sewer billing and rate study; staff to add missed parcels to bills
Summary
City staff and consultant presented a multi‑phase sewer billing assessment and rate study that would add unbilled parcels (including some tax‑exempt entities) to property tax billing, adopt a flow‑based rate structure informed by statewide data, and likely phase modest rate increases starting FY2028. Council asked for local calibration of assumptions and numeric comparisons before adoption.
City staff and a utilities consultant presented a multi‑year sewer billing and rate study to the City Council on April 6, summarizing a billing assessment, long‑range financial plan and alternative rate structures that would bring unbilled parcels onto the sewer charge roll and change how rates are calculated.
The presentation, led by Public Works program manager D'vorah Zotter and consultant Kevin Costik, described a two‑phase effort: first a billing assessment to verify parcel data and ensure all properties receiving sewer service are billed (including tax‑exempt parcels such as some institutional properties), and second a cost‑of‑service rate study that would allocate costs using updated flow factors and parcel square footage rather than only legacy ERU (equivalent residential unit) tables.
Why it matters: staff said the city is operating under a federal consent decree addressing wet‑weather overflows and collection‑system rehabilitation; consultant modeling estimated roughly $3.5 million per year in reinvestment related to that decree, which factors into long‑term rate needs. Preliminary financial modeling presented at the meeting indicated no rate increase is required for fiscal year 2027 but showed modest increases likely in fiscal year 2028 and beyond to sustain the capital program and reserves.
How the proposal would change billing: instead of solely using legacy ERU multipliers, the consultant proposed using a square‑footage approach tied to flow and loading factors from a California Association of Sanitation Agencies study. That change is intended to make charges more proportional to wastewater flow, with multifamily units treated as fractional ERUs (the consultant gave an example where an apartment unit might be ~0.84 ERU under updated assumptions).
Council questions and next steps: council members pressed staff on several issues they asked be clarified with numeric comparisons before adoption: how proposed charges would affect commercial and multifamily customers, whether tax‑exempt parcels such as school properties and large nonprofits would be billed, and how to account for lot frontage, lot size and density effects on the cost of service. Staff confirmed the billing assessment will identify unbilled tax‑exempt properties and that direct billing changes could be implemented for the fiscal 2027 tax roll; the rate study and required Proposition 218 notices would proceed through 2027 with potential implementation in FY2028.
What comes next: staff said they will return with detailed, locality‑calibrated numbers comparing current versus proposed schedules, documentation required for Prop 218 noticing, and a timeline showing billing corrections for FY27 billing and rate adoption steps in 2027 for FY28 implementation.
Quotes: "Everything from the data quality to parcel QA/QC is part of the billing assessment," consultant Kevin Costik told the council. Public Works program manager D'vorah Zotter added, "The goal of completing by the end of FY26 is to incorporate those fixes into the FY27 billing cycle."
The council directed staff to return with the numeric comparisons and modeling assumptions staff relied upon, including local flow estimates and how multifamily and high‑density parcels would be treated.
