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HomeMy WebLinkAboutCity Council Committees - Operations Committee - 08/02/2016 (2) Unless otherwise noted, the Operations Committee meets at 4 p.m. on the first and third Tuesday of each month in Kent City Hall, Council Chambers East, 220 4th Ave S, Kent, 98032. For additional information please contact Jennifer Hays at 253-856-5700. Any person requiring a disability accommodation should contact the City Clerk’s Office at 253-856-5725 in advance. For TDD relay service call Washington Telecommunications Relay Service at 1-800-833-6388. Operations Committee Agenda Councilmembers: Bill Boyce – Les Thomas – Dana Ralph, Chair August 2, 2016 4 p.m. Item Description Action Speaker Time Page 1. Call to order Chair Ralph 1 2. Roll Call Chair Ralph 1 3. Changes to the Agenda Chair Ralph 1 4. Approval of Check Summary Report dated 6/16/2016 thru 6/30/2016 and 7/1/2016 thru 7/15/2016 YES Chair Ralph 2 5. Approval of Meeting Minutes Dated July 5, 2016 YES Chair Ralph 2 1 6. Consolidating Budget Adjustment Ordinance for Adjustments between April 1, 2016 and June 30, 2016 – Recommend YES Barbara Lopez 5 5 7. Water and Sewer Rates Ordinance – Information Only NO Tim LaPorte 5 11 8. May Financial Report – Information Only NO Aaron BeMiller 5 41 9. Director’s Report – Information Only NO Aaron BeMiller 5 57 10. 2nd Quarter Procurement Report – Information Only NO Derek Matheson 5 59 This page intentionally left blank OPERATIONS COMMITTEE MINUTES July 5, 2016 Committee Members Present: Les Thomas; Bill Boyce; and Dana Ralph, Chair The meeting was called to order by Dana Ralph at 4:01 p.m. 1. ROLL CALL. 2. CHANGES TO THE AGENDA. Agenda item #11, 2016 Property Insurance Program Review – Information Only, was moved to #6. Accordingly, the rest of the items moved down. 3. APPROVAL OF THE CHECK SUMMARY REPORT DATED 6/01/2016 THRU 6/15/2016. L. Thomas moved to approve the check summary report dated 6/01/16 through 6/15/16. B. Boyce seconded the motion, which passed 3-0. 4. APPROVAL OF MINUTES DATED JUNE 21, 2016. B. Boyce moved to approve the Operations Committee minutes dated June 21, 2016. L. Thomas seconded the motion, which passed 3-0. 5. PROPERTY INSURANCE PROGRAM REVIEW – INFORMATION ONLY. Risk Manager Chris Hills updated members on the City’s Property Insurance Program. As a result of the region not having any major natural disasters, the City has locked in a 10.3 percent premium decrease, a $360,000 savings, for the remainder of 2016 through 2017; Finance will be making the appropriate adjustments. In light of Brexit, Mr. Hill will be keeping an eye on the London insurance market which could affect the world-wide insurance market as one the City’s insurers is a German based company. 6. CENTURYLINK LOYAL ADVANTAGE AGREEMENT FOR TELECOMMUNICATIONS SUPPORT AND SERVICES –RECOMMEND. Information Technology (IT) Director Mike Carrington and Technical Services Manager James Endicott requested authorization to consolidate multiple vendors to a single vendor relationship with CenturyLink, an annual cost savings of $36,000. Presently, the City has multiple vendors providing different aspects of telecommunications hardware and services. These providers purchase services directly from CenturyLink and resell them to the City. Mayor Cooke granted IT’s request to waive the competitive bid requirements of Kent City Code and authorized the department to contract directly with CenturyLink. IT Operational funds were earmarked in the 2015 - 2016 budgets in the amount of $141,000 for telecommunication services and $35,000 for maintenance services. 1 Operations Committee Minutes July 5, 2016 Page: 2 L. Thomas moved to recommend Council authorize the Mayor to sign CenturyLink’s Loyal Advantage Agreement, in the amount not to exceed $140,000.00, for communications hardware and services, subject to final terms and conditions acceptable to the Information Technology Director and City Attorney. B. Boyce seconded the motion, which passed 3-0. 7. DLT – ORACLE - JDE DATABASE & ONEWORLD ERP MAINTENANCE RENEWAL - RECOMMEND. Mr. Carrington requested approval of maintenance agreements in the amounts of $54,485.88 for Oracle DB Enterprise and $118,536.44 for Oracle JDE/OneWorld. IT will use residual savings in its maintenance renewal budget to cover the difference between these vendor price quotations and the estimates in the 2015 – 2016 biennial budget. B. Boyce moved to recommend Council authorize the Mayor to sign DLT Oracle DB Enterprise and Oracle JDE OneWorld Maintenance Renewal Agreements, in the amount not to exceed $59,345.00 and $126,520.45, respectively, for existing Oracle software and support, subject to final terms and conditions acceptable to the Information Technology Director and City Attorney. L. Thomas seconded the motion, which passed 3- 0. 8. IT LONG-TERM STAFFING PLAN – 2016 FTE REQUEST - RECOMMEND. Mr. Carrington’s final request is to add four full-time employees (FTE) in the 2016 calendar year as a critical component of the IT Long-term Staffing Plan. The IT department is critically understaffed and has been since recession related cuts began in 2009 - 2010. Research shows the national average for FTE count in an IT department within a public sector/government organization of our size to be approximately 41. The IT department is currently staffed at 31 FTE, but six of those positions exist in the Multimedia division. Although Multimedia is a large technology consumer, their primary directive revolves around communications support. Removing the Multimedia head count from the current total puts the IT department at 25 FTE. Total estimated annual cost of the new positions is forecasted to be approximately $545,000 which would be covered by way of the Cable Utility Tax (CUT), a budget of $1.5 million. Per the Finance Department, approximately $850,000 is available to support this staffing request; additionally, $650,000 is earmarked for general operating costs. B. Boyce moved to recommend Council add four new FTE positions within the Information Technology Department—a Senior Systems Analyst, a Systems & Integration Development Manager, a Project Manager/Business Analyst, and a Trainer—at the salary range determined by each classification and the directors of Human Resources and Information Technology; amend the budget as necessary; and authorize all acts consistent with this motion. L. Thomas seconded the motion, which passed 3-0. 9. SCHOOL ZONE TRAFFIC SAFETY CAMERA PROGRAM FUND EXPENDITURES - RECOMMEND. Kent Police Chief Thomas sought approval to use excess funds from the traffic safety cameras to cover costs of two capital improvement projects: 1) relocation and set-up of 2 Operations Committee Minutes July 5, 2016 Page: 3 the East Hill police substation; and 2) installation of a ballistic barrier on the second and third floors of the Centennial Center parking garage to improve the security of police personnel. Total expenditures of $150,000 for both projects will come from revenue received in the School Zone Traffic Safety Camera Fund. Kent City Code requires funds derived from the use of traffic safety cameras be used to first cover the costs of administering the program, with excess funds to be used for criminal justice-related purposes, current balance in the fund is in excess of $1 million. L. Thomas moved to Recommend Council authorize the expenditure of funds from the School Zone Traffic Safety Camera Fund to (1) improve space at the Kent East Hill Shopping Center for the relocation and set-up of the East Hill police substation, in the approximate amount of $35,000, and (2) install a ballistic barrier on portions of the Centennial Center Garage to improve the security of police personnel, in the approximate amount of $115,000; amend the budget; and authorize the Mayor to sign all documents necessary to complete these projects, subject to final terms acceptable to the Police Chief and City Attorney. B. Boyce seconded the motion, which passed 3-0. 10. K2 POLICE SUBSTATION – RECOMMEND. Chief Thomas’ final request is to enter into a five-year lease to secure a location to establish a police substation. Space is currently available in the Kent East Hill Shopping Center, located at 25635 104th Avenue SE. The area is known to have a high crime rate; police presence would limit that as well as keep officers closer to their beat. This new location would replace the existing substation located at the training center keeping the current number of four total substations. Economic and Community Development Deputy Director Kurt Hanson helped negotiate a lease that is about $2.00 a square foot less than the current market value. The monthly rent that will be due during years two through five of the initial five-year term will increase on August 1 of each year by an amount equal to two percent of the previous year’s monthly rent. The lease also allows for a second five-year term. B. Boyce moved to recommend Council authorize the Mayor to enter into a lease agreement with Kent Hill, LLC, for an initial 5-year term and an option to renew for an additional 5-year term, to establish a police substation on the East Hill of Kent, subject to final lease terms and conditions acceptable to the Police Chief and City Attorney. L. Thomas seconded the motion, which passed 3-0. 11. DIRECTOR’S REPORT – INFORMATION ONLY. Finance Director Aaron BeMiller updated members on:  There are no anticipated audit findings from the State Auditor’s Office  2015 Public Facilities District uncollectable debt service increased from 18.7 percent to 21.9 percent; bonds will be at full maturity in 2037  Unfunded pension liability was adjusted to $26 million  A correction was made to the 2015 fourth quarter regarding internal loans. The correction has no cash value. 3 Operations Committee Minutes July 5, 2016 Page: 4 The meeting was adjourned at 4:50 p.m. by D. Ralph. J. Hays Jennifer Hays Operations Committee Secretary 4 FINANCE Aaron BeMiller Director Phone: 253-856-5260 Fax: 253-856-6255 Address: 220 Fourth Avenue S. Kent, WA. 98032-5895 DATE: August 2, 2016 TO: Kent City Council Operations Committee FROM: Barbara Lopez, Deputy Finance Director SUBJECT: Consolidating Budget Adjustment Ordinance for Adjustments between April 1, 2016 and June 30, 2016 SUMMARY: Authorization is requested to approve the technical gross budget adjustment ordinance reflecting an overall budget increase of $6,791,110. Adjustments totaling $6,408,110 have been approved by Council or under the provisions of KCC 3.70 – Public Contracting and Procurement. Highlights include:  $2,354,040 to recognize grants awarded for 72nd Avenue, Salmon Recovery and the Lake Meridian Dock.  $2,519,420 for 72nd Avenue Extension.  $759,970 for the Pine Tree Park settlement.  $591,350 to implement the wage provisions of the KPOA agreement. The remaining amount not yet approved by Council is an overall increase of $383,000, including:  $300,000 to establish a budget for initial planning of the light rail stations to be constructed within Kent.  $83,000 to expand the marketing budget paid from hotel/motel tax, per action taken by the Lodging Tax Advisory Board. BUDGET IMPACT: These expenditures are funded by grants, existing fund balance, or other new revenues. MOTION: Recommend Council approve the consolidating budget adjustment ordinance for adjustments made between April 1, 2016 and June 30, 2016 reflecting an overall budget increase of $6,791,110. 5 ORDINANCE NO. AN ORDINANCE of the City Council of the City of Kent, Washington, approving the consolidating budget adjustments made between April 1, 2016 and June 30, 2016, reflecting an overall budget increase of $6,791,110. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: ORDINANCE SECTION 1. – Budget Adjustments. The 2015-2016 biennial budget is amended to include budget fund adjustments for the second quarter of 2016 from April 1, 2016 through June 30, 2016, as summarized and set forth in Exhibit “A,” which is attached and incorporated into this ordinance. Except as amended by this ordinance, all terms and provisions of the 2015-2016 biennial budget Ordinance No. 4137, as amended by Ordinance Nos. 4149, 4168, 4173, 4185, and 4200 shall remain unchanged. SECTION 2. – Severability. If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. 1 2015-2016 Budget Adjustment Second Quarter - 2016 6 SECTION 3. – Corrections by City Clerk or Code Reviser. Upon approval of the city attorney, the city clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 4. – Effective Date. This ordinance shall take effect and be in force five days from and after its passage and publication, as provided by law. SUZETTE COOKE, MAYOR ATTEST: SUE HANSON, INTERIM CITY CLERK APPROVED AS TO FORM: TOM BRUBAKER, CITY ATTORNEY PASSED: day of , 2016. APPROVED: day of , 2016. PUBLISHED: day of , 2016. I hereby certify that this is a true copy of Ordinance No. passed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated. (SEAL) SUE HANSON, INTERIM CITY CLERK P:\Civil\Ordinance\Budget Adjustment Ordinance 2nd Quarter 2016.docx 2 2015-2016 Budget Adjustment Second Quarter - 2016 7 Fund Title Previously Approved Approval Requested Total Adjustment Ordinance 100 General Fund 1,209,880 - 1,209,880 110 Street Fund 55,200 - 55,200 130 Lodging Tax Fund - 83,000 83,000 150 Capital Resources Fund 759,970 150,000 909,970 160 Criminal Justice Fund (343,738) - (343,738) 190 Other Operating Fund 20,000 - 20,000 310 Street Capital Projects Fund 2,269,888 - 2,269,888 320 Parks Capital Projects Fund 537,200 - 537,200 330 Other Capital Projects Fund 199,710 150,000 349,710 440 Drainage / Sewer Utility Fund 1,700,000 - 1,700,000 Total 6,408,110 383,000 6,791,110 Exhibit A City of Kent Budget Adjustment Ordinance Adjustments April 1, 2016 to June 30, 2016 8 Approval Date or Other Fund Previously Approved by Council Not Previously Approved by Council Total Adjustment Ordinance 1 HR Supported Employment 12/08/2015 44,730 - 44,730 1 Establish HR Business Strategy Analyst Position 05/03/2016 61,400 - 61,400 1 Establish Homeless Planner Budget 02/02/2016 20,000 - 20,000 1 KPOA Contract 02/02/2016 560,020 - 560,020 1 Street/CJ Allocation to Annexation 12/08/2015 523,730 - 523,730 Total General Fund 1,209,880 - 1,209,880 110 72nd Avenue Extension 04/19/2016 120,000 - 120,000 110 Street Allocation to Annexation 12/08/2015 (64,800) - (64,800) Total Street Fund 55,200 - 55,200 130 Marketing Budget-Inc. per Lodging Tax Advisory Board - 83,000 83,000 Total Lodging Tax Fund - 83,000 83,000 150 Pine Tree Park Settlement 04/05/2016 759,970 - 759,970 150 Sound Transit Light Rail - 150,000 150,000 Total Capital Resources Fund 759,970 150,000 909,970 160 PD KPOA Contract 02/02/2016 31,330 - 31,330 160 Justice Assistance Grant KCC 3.70 45,797 - 45,797 160 WASPC Sex Offender Grant KCC 3.70 38,065 - 38,065 160 Criminal Justice Allocation to Annexation 12/08/2015 (458,930) - (458,930) Total Criminal Justice Fund (343,738) - (343,738) 190 Establish Homeless Planner Budget 03/01/2016 20,000 - 20,000 Total Other Operating Fund 20,000 - 20,000 310 72nd Avenue Extension 04/19/2016 1,199,710 - 1,199,710 310 Establish TIB 72nd Avenue Grant 03/20/2016 1,070,178 - 1,070,178 Total Street Capital Projects Fund 2,269,888 - 2,269,888 320 4th Qtr Fee-in-Lieu Funds 02/02/2016 37,200 - 37,200 320 Establish RCO Grant Budget 02/02/2016 500,000 - 500,000 Total Parks Capital Projects Fund 537,200 - 537,200 330 72nd Avenue Extension 04/19/2016 199,710 - 199,710 330 Sound Transit Light Rail - 150,000 150,000 Other Capital Projects Fund 199,710 150,000 349,710 440 72nd Avenue Extension 04/19/2016 1,000,000 - 1,000,000 440 Establish Salmon Recovery Grant 02/16/2016 700,000 - 700,000 Total Drainiage/Sewer Utility Fund 1,700,000 - 1,700,000 Grand Total All Funds 6,408,110 383,000 6,791,110 Budget Adjustment Detail for Budget Changes April 1, 2016 to June 30, 2016 110 - Street Fund 150 - Capital Resources Fund 160 - Criminal Justice Fund 310 - Street Capital Projects 440 - Drainage/Sewer Utility Fund 001 - General Fund 320 - Parks Capital Projects Fund 330 - Other Capital Projects Fund 190 - Other Operating Fund 130 - Lodging Tax Fund 9 This page intentionally left blank 10 PUBLIC WORKS DEPARTMENT Timothy J LaPorte P.E., Public Works Director Phone: 253-856-5500 Fax: 253-856-6500 Address: 400 West Gowe Street Kent, WA 98032-5895 DATE: August 1, 2016 To: Operations Committee From: Timothy J. LaPorte, P.E., Public Works Director Subject: Water and Sewer Rates Ordinance - Information Only Summary: As requested by Council President Boyce, staff is presenting a discussion on Sewer and Water Rates to the Operations Committee on August 2, 2016. The Public Works Committee has reviewed options presented by staff over the last six months and may recommend moving the item on to the August 16 Council meeting for action under Other Business. Sewer and water rates were discussed with Council at its Workshop on February 16, 2016. Staff has either already met, or will be meeting soon, with all Councilmembers individually to review details of the financial situation for both the sewer and water utilities. The sewer utility is not sustainable with the current rate structure. Paul Scott will present a brief summary of staff’s analysis over the last several years along with recommendations to improve the utility’s future position. Below is a brief summary of some of the issues facing the sewer utility: Sewer Utility:  212 miles of sewer pipe of which a significant amount is aging beyond its expected life;  Seven Pump Stations; three of which are old and well beyond their expected life. Because of the average depth of our sewer lines, repair or replacement is very expensive; $1 million can be easily spent with a relatively short distance of pipe replaced. Kent is blessed with excellent, secured water sources due to good long range planning by City Councils of the distant and recent past. However, maintenance and required upgrades of our existing infrastructure necessitates changes to water rates. The current water rate structure needs to be upgraded to include fire capacity charges, and to redirect the weight of the rates from consumption to the MOTION: INFORMATION ONLY 11 cost of delivering of water to homes and businesses, which is consistent with nearly all of Kent’s neighbors. Water Utility:  287 Miles of Watermain;  Seven Major Pressure Zones that supply water from;  16 Wells;  Two Spring sources and surface water source from our Tacoma water supply;  A significant amount of our waterlines need to be replaced due to age and makeup (Recent work - South Central and James streets);  640 Pressure Zone on the East Hill is only partway complete and will need significant piping improvements in order for it to be implemented;  Guiberson Reservoir will need to be replaced;  New reservoir on the West Hill will ultimately be necessary. Exhibits: Proposed Ordinance Budget Impact: Adopting the proposed ordinances would provide additional revenue to both the sewer and water utilities. 12 1 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates ORDINANCE NO. AN ORDINANCE of the City Council of the City of Kent, Washington, amending Section 3.18.020, entitled “Certain utilities subject to tax,” to reallocate the internal utility taxes, amending Section 7.02.180 entitled “Temporary water meters,” combining Sections 7.02.300 and 7.02.310 entitled “Water rates,” to increase rates and charges for all water service, whether within or outside the city, , and amending Section 7.04.280 entitled “Schedule of charges for service,” increasing the sewer rates. RECITALS A. The city last established its water and sewer rate structure in 2008. Since that time, other municipal water and sewer providers have restructured their rates by more proportionately distributing overall system usage by balancing potable water consumption, water meter size, and non-potable fire protection standby reserves for sprinkler systems and other fire protection systems. Sewer rates were also adjusted accordingly. B. After conducting a system review and rate analysis, the city similarly has determined to adjust its water and sewer rate structure, including combing the rate structure to create single, uniform rates for all city water service. A new rate is also included for dedicated firelines, which will pay for the water capacity and pressure needed to operate these systems when fire protection is needed. 13 2 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates C. Increased operational costs have occurred since the city’s water and sewer rates were last amended, and in order to maintain and operate the city’s water and sewer systems at existing levels of service, rates for city water and sewer services are increased. D. To accommodate ongoing cost increases after implementation of these rate changes, an annual cost of living increase has been added based on the regional consumer price index (CPI), with increases capped until January 1, 2023, at 2.4% or the CPI, whichever is less, with increases after that date to conform to the CPI without any cap. E. Disposition and allocation of the city’s water, sewer, and storm utility tax revenue, which is imposed on each utility’s gross receipts, has been amended and clarified to conform to existing practice. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: ORDINANCE SECTION 1.- Amendment.Section 3.18.020 of the Kent City Code, entitled “Certain utilities subject to tax,” is hereby amended as follows: Sec. 3.18.020 Certain utilities subject to tax. A. In addition to the other business and license fees required by the ordinances of the city, the city levies upon all persons, firms, or corporations (including the city) engaged in certain business activities a utilities tax to be collected as follows: 1. Upon every person, firm, or corporation engaging in or carrying on any telephone business within the city, an annual tax equal to six (6) percent of the total gross income, including revenues from 14 3 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates intrastate toll, derived from the operation of such business within the city. This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 2. Upon every person, firm, or corporation engaging in or carrying on a business of selling, wheeling, furnishing, distributing, or producing gas, whether manufactured or natural, for commercial or domestic use or purposes, a fee or tax equal to six (6) percent of the total gross income from such business in the city during the tax year for which the license is required. This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 3. Upon every person, firm, or corporation engaged in or carrying on the business of selling, wheeling, furnishing, or distributing electricity for light and power, a fee or tax equal to six (6) percent of the total gross income from such business in the city during the tax year for which a license is required. This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three- tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 4. Upon every person, firm, or corporation engaged in or carrying on the business providing cable television services, a tax equal to six (6) percent of the total gross income from that business in the city during the tax year for which the license is required. All revenue received from this tax must be applied only to funding the city’s information technology department operations and capital projects budgets in the proportion determined by the city council in its biennial budget, including all amendments. 15 4 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates 5. Upon every person, firm, or corporation engaging in or carrying on a business providing solid waste collection services, a tax equal to eighteen and four-tenths (18.4) percent of the total gross income from such business in the city during the tax year for which the license is required. This eighteen and four-tenths (18.4) percent tax will be allocated as follows: six and one-half (6.5) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, one (1) percent to street improvement programs, and ten and six-tenths (10.6) percent to maintain and repair residential streets, including related impacts to curb, gutters, sidewalks, and other road amenities, but this ten and six-tenths (10.6) percent portion of the solid waste utility tax shall not be used to expand, extend, or widen existing residential streets or to build new residential streets. 6. Upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing water services, a tax equal to thirteen (13) percent of the total gross income from that business in the city during the tax year; upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing sewer services, a tax equal to nine and one-half (9.5) percent of the total gross income from that business in the city during the tax year; and upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing drainage services, a tax equal to nineteen and one-half (19.5) percent of the total gross income from such business in the city during the tax year. Unless otherwise directed by the city council in its budget process, the total of these tax revenues will be allocated as follows: forty three and eighty-five one-hundredths percent (43.85%) to the general fund for the use as allocated in the city’s budget; thirty and seventy-seven one- hundredths percent (30.77%) to the capital resources fund, subject to the limitations provided in subsection (A)(6)(a) of this section; fifteen and thirty-eight one-hundredths percent (15.38%) dedicated solely to the 16 5 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates repayment and elimination of debt in the city’s “other capital projects” fund subject to the limitations provided in subsection (A)(6)(b) of this section; seven and sixty-nine one-hundredths percent (7.69%) to street improvement programs; and two and thirty-one one-hundredths percent (2.31%) to youth/teen programs. a. Unless otherwise allocated by council, these funds must be applied equally to (i) information technology capital programs directed at funding long- and short-term hardware and software replacement and (ii) street capital programs, but further restricted to funding street maintenance, repair, and signage only. b. The fifteen and thirty-eight one-hundredths percent (15.38%) internal tax allocation will be dedicated to the city’s capital resources fund for the sole purpose of retiring all debt in the city’s other capital projects fund; however, in any event this portion of the tax shall be eliminated on January 1, 2023, or on the first day of the year following the date the debt in this fund is fully retired, whichever occurs first. B. In computing the tax provided in subsection (A) of this section, the taxpayer may deduct from total gross income the following items: 1. The actual amount of credit losses and uncollectible receivables sustained by the taxpayer. 2. Amounts derived from transactions in interstate and foreign commerce which the city is prohibited from taxing under the laws and Constitution of the United States. 17 6 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates SECTION 2.- Amendment.Section 7.02.180 of the Kent City Code, entitled “Temporary water meters,” is hereby amended as follows: Sec. 7.02.180 Temporary water meters. A. When water service is required for a specific short-term duration, upon approval of the director of public works, a temporary water meter may be obtained from the water utility. B. Such meters shall only be used for a designated project and shall be promptly returned to the water utility upon completion of the project or at the end of sixty (60) days, whichever comes first. The meters are to be returned in the same condition as when rented, and the user shall be held responsible for any damage thereto including paying all repair or replacement costs. While in the user’s possession, the user shall be solely responsible for the meter and as such, should it be lost or stolen, the user shall pay the water utility the cost of its replacement. C. The director of public works shall require that a cash bond be deposited with the city prior to receipt of a temporary meter. The amount of the bond shall equal the replacement cost of the respective meter. Upon return of the meter, the payment of all outstanding charges including any meter repair or replacement costs, the cash bond shall be released back to the user. D. Temporary meters may be moved from one (1) hydrant to another within the same project; provided, the water utility is notified in advance of the proposed relocation and that hydrant wrenches are used to make all connections and disconnections. E. For each 100 cubic feet of water used with a temporary water meter, the rate charged will be $4.73 per 100 cubic feet of water used. All rates are also subject to a one-time temporary meter charge as follows: 18 7 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates 1. Up to one and one-half (1-1/2) inch meter, fifty dollars ($50); 2. Two (2) inch and larger meter, one hundred dollars ($100). Payment shall be made in full upon return of the meter. If a meter is lost or stolen, payment for water used shall be based on an estimate made by the director of public works. SECTION 3.- Amendment.Section 7.02.300 of the Kent City Code, entitled “Water rates within the city,” is hereby amended as follows: Sec. 7.02.300 Water rates. A.Water rates. The following monthly rates apply to all water customers served by the city of Kent. The lower rate applies per 100 cubic feet of water used up to or equal to 800 cubic feet per month, and the higher rate applies per 100 cubic feet of any water used in excess of 800 cubic feet: WATER USE/CONSUMPTION Winter/Summer <=800cf: $2.40 >800cf: $4.73 All customers are also subject to a monthly demand charge for potable water service, dedicated fireline service, and water meters. For purposes of this chapter, a “dedicated fireline” constitutes the pipe(s) and appurtenances on private property that only supply water to the system riser for water-based fire protection systems, private hydrants, monitor nozzles, fire pump suctions, and tanks. The dedicated fireline begins after the property isolation device, and it contains water that will be used only when needed for fire protection purposes and so will become stagnant and non-potable. The fees for these monthly demand services are as follows: 19 8 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates Meter size or, for Dedicated Fireline, Pipe size (inches) Residential Charge Effective January 1, 2017 Commercial Charge Effective January 1, 2017 Dedicated Fireline Charge Effective January 1, 2017 ≤3/4 $23.15 $29.10 $2.75 1 $36.25 $42.20 $3.21 1-1/4 4.81 1-1/2 $69.00 $74.95 $6.42 2 $108.30 $114.25 $10.27 3 $173.80 $179.75 $25.67 4 $265.50 $271.45 $51.33 6 $402.45 $102.67 8 $533.45 $173.25 10 $664.45 $256.67 Beginning January 1, 2018, and on the first day of each calendar year thereafter, the total water rate for consumption, meters, and dedicated fireline usage will adjust by the Consumer Price Index (CPI), specifically the CPI-W Seattle-Tacoma-Bremerton, measured from June 1 through June 1 of the previous calendar year, if the CPI-W reflects an upward adjustment from the previous annual June to June period. For the years 2018-2022 the adjustment will not exceed 2.4% of the total water rate, but after that, beginning January 1, 2023, any increase in the CPI will not be subject to this 2.4% limit. In order to simplify the rate-making structure, the finance director is authorized to amend the rate each year to reflect the CPI adjustment. B.Lifeline customers. The city council will establish eligibility criteria for lifeline customers. For lifeline-qualified water service customers within the city limits, the following rates apply for water use per 100 cubic feet: 20 9 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates Effective Date January 1 – December 31 01/01/2005 $0.51 06/01/2009 $0.53 01/01/2010 $0.54 01/01/2011 $0.56 01/01/2012 $0.57 01/01/2013 $0.59 01/01/2014 $0.61 All lifeline rates are also subject to the monthly demand charge for service and meter as set forth in subsection (A) of this section. SECTION 4.- Repealer.Section 7.02.310 of the Kent City Code, entitled “Water rates outside city,” is hereby repealed in its entirety. SECTION 5.- Amendment.Section 7.04.280 of the Kent City Code, entitled “Schedule of charges for service,” is hereby amended as follows: Sec. 7.04.280 Schedule of charges for service.King County imposes a sanitary sewer service charge for regional sewage treatment. These charges are passed through, without increase, directly to the city sanitary sewer utility customers. The King County pass-through charge for 2017 is known and established. It is expected, however, that King County will increase its pass-through charge over time. Accordingly, except for the 2017 charge, all other King County charges are estimates only. In order to simplify the rate-making structure, the finance director is authorized to amend King County’s pass-through charges at the time King County imposes new charges. 21 10 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates Beginning January 1, 2018, and on the first day of each calendar year thereafter, the total sewer rate will adjust by the Consumer Price Index (CPI), specifically the CPI-W Seattle-Tacoma-Bremerton, measured from June 1 through June 1 of the previous calendar year, if the CPI-W reflects an upward adjustment from the previous annual June to June period. For the years 2018-2022 the adjustment will not exceed 2.4% of the total sewer rate, but after that, beginning January 1, 2023, any increase in the CPI will not be subject to this 2.4% limit. In order to simplify the rate-making structure, the finance director is authorized to amend the rate each year to reflect the CPI adjustment. In addition, the year 2017 City rate for all types of service is subject to any CPI or King County rate increases; for the year 2018 the City rate will increase one-dollar and twenty-five cents (1.25) in addition to any CPI or King County rate increases; and for the year 2019 the City rate will increase fifty cents (.50) in addition to any CPI or King County rate increases. The following sanitary sewer service charges for city sanitary sewer service inside the city limits are in effect on the dates and in the amounts listed below. Sewer service charges for customers residing outside the city shall be the charges as on file in the city clerk’s office. Type of Service City Sewer Rate King County Sewer Rate† Total Sewer Rate 1. Single-family residential dwelling, as defined in Chapter 15.02 KCC. $22.16 $44.22 $64.90 2. Two-family or multiple-family residential dwelling, as defined in Chapter 15.02 KCC, each unit separately metered and charged. $22.16 $44.22 $64.90 22 11 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates Type of Service City Sewer Rate King County Sewer Rate† Total Sewer Rate 3. Single-family residential/lifeline: eligibility criteria for the lifeline utility rate set forth in KCC 7.01.080. $12.70 $44.22 $56.92 4. All other than service types 1, 2 and 3 shall be billed in accordance with the consumption of water and at the following rate,*except that no monthly bill shall be less than the single-family residential rate set forth in service type No. 1. $8.65* per 100 cubic feet per month $8.82* per 100 cubic feet per month $8.88* per 100 cubic feet per month †Estimated, based on adjustments issued by King County. *Beginning January 1, 2018, this rate will adjust annually based on the basic rate shown for service types 1 and 2 above, calculated on this formula: Total Sewer Rate/7.5 = price per 100 cubic ft. per month. SECTION 6.– Severability.If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. SECTION 7.– Corrections by City Clerk or Code Reviser.Upon approval of the city attorney, the city clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 8.– Effective Date.Although the fees, rates, and charges established by this ordinance do not take effect until January 1, 2017, this ordinance shall take effect and be in force 30 days from and after its passage, as provided by law. SUZETTE COOKE, MAYOR 23 12 Amend KCC 3.18.020, 7.04.280, And Ch. 7.02 KCC Re: Sewer and Water Rates ATTEST: SUE HANSON, INTERIM CITY CLERK APPROVED AS TO FORM: TOM BRUBAKER, CITY ATTORNEY PASSED:day of , 2016. APPROVED: day of , 2016. PUBLISHED: day of , 2016. I hereby certify that this is a true copy of Ordinance No. passed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated. (SEAL) SUE HANSON, INTERIM CITY CLERK P:\Civil\Ordinance\7 04 and 3 18 Sewer Rate Increase NEARFINALDRAFT.docx 24 1 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates ORDINANCE NO. AN ORDINANCE of the City Council of the City of Kent, Washington, amending Section 3.18.020, entitled “Certain utilities subject to tax,” to reallocate the internal utility taxes, amending Section 7.02.180 entitled “Temporary water meters,” combining Sections 7.02.300 and 7.02.310 entitled “Water rates,” to increase rates and charges for all water service, whether within or outside the city, , and amending Section 7.04.280 entitled “Schedule of charges for service,” increasing the sewer rates. RECITALS A. The city last established its water and sewer rate structure in 2008. Since that time, other municipal water and sewer providers have restructured their rates by more proportionately distributing overall system usage by balancing potable water consumption, water meter size, and non-potable fire protection standby reserves for sprinkler systems and other fire protection systems. Sewer rates were also adjusted accordingly. B. After conducting a system review and rate analysis, the city similarly has determined to adjust its water and sewer rate structure, including combing the rate structure to create single, uniform rates for all city water service. A new rate is also included for dedicated firelines, which will pay for the water capacity and pressure needed to operate these systems when fire protection is needed. 25 2 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates C. Increased operational costs have occurred since the city’s water and sewer rates were last amended, and in order to maintain and operate the city’s water and sewer systems at existing levels of service, rates for city water and sewer services are increased. D. To accommodate ongoing cost increases after implementation of these rate changes, an annual cost of living increase has been added based on the regional consumer price index (CPI), with increases capped until January 1, 2023, at 2.4% or the CPI, whichever is less, with increases after that date to conform to the CPI without any cap. E. Disposition and allocation of the city’s water, sewer, and storm utility tax revenue, which is imposed on each utility’s gross receipts, has been amended and clarified to conform to existing practice. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: ORDINANCE SECTION 1.- Amendment.Section 3.18.020 of the Kent City Code, entitled “Certain utilities subject to tax,” is hereby amended as follows: Sec. 3.18.020. Certain utilities subject to tax. A. In addition to the other business and license fees required by the ordinances of the city, the city levies upon all persons, firms, or corporations (including the city) engaged in certain business activities a utilities tax to be collected as follows: 1. Upon every person, firm, or corporation engaging in or carrying on any telephone business within the city, an annual tax equal to six (6) percent of the total gross income, including revenues from intrastate toll, derived from the operation of such business within the city. 26 3 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 2. Upon every person, firm, or corporation engaging in or carrying on a business of selling, wheeling, furnishing, distributing, or producing gas, whether manufactured or natural, for commercial or domestic use or purposes, a fee or tax equal to six (6) percent of the total gross income from such business in the city during the tax year for which the license is required. This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 3. Upon every person, firm, or corporation engaged in or carrying on the business of selling, wheeling, furnishing, or distributing electricity for light and power, a fee or tax equal to six (6) percent of the total gross income from such business in the city during the tax year for which a license is required. This six (6) percent tax will be allocated as follows: four and seven-tenths (4.7) percent to the general fund, three- tenths (0.3) percent to youth/teen programs, and one (1) percent to street improvement programs. 4. Upon every person, firm, or corporation engaged in or carrying on the business providing cable television services, a tax equal to six (6) percent of the total gross income from that business in the city during the tax year for which the license is required. All revenue received from this tax must be applied only to funding the city’s information technology department operations and capital projects budgets in the proportion determined by the city council in its biennial budget, including all amendments. 5. Upon every person, firm, or corporation engaging in or carrying on a business providing solid waste collection services, a tax equal to eighteen and four-tenths (18.4) percent of the total gross income 27 4 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates from such business in the city during the tax year for which the license is required. This eighteen and four-tenths (18.4) percent tax will be allocated as follows: six and one-half (6.5) percent to the general fund, three-tenths (0.3) percent to youth/teen programs, one (1) percent to street improvement programs, and ten and six-tenths (10.6) percent to maintain and repair residential streets, including related impacts to curb, gutters, sidewalks, and other road amenities, but this ten and six-tenths (10.6) percent portion of the solid waste utility tax shall not be used to expand, extend, or widen existing residential streets or to build new residential streets. 6. Upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing water services, sewer, or drainage services, a tax equal to thirteen (13) percent of the total gross income from that business in the city during the tax year; upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing sewer services, a tax equal to nine and one-half (9.5) percent of the total gross income from that business in the city during the tax year; and upon every person (including the city) engaging in or carrying on the business of selling, furnishing, or distributing drainage services, a tax equal to nineteen and one-half (19.5) percent of the total gross income from such business in the city during the tax year. This thirteen (13) percent Unless otherwise directed by the city council in its budget process, Tthe total of these taxes revenues will be allocated as follows: five and seven-tenths (5.7) forty three and eighty- five one-hundredths (43.85) percent (43.85%) to the general fund for the use as allocated in the city’s budget; four (4)thirty and seventy-seven one-hundredths (30.77) percent (30.77%) to the general street capital resources fund only for the installation, operation, maintenance, and repair of street lighting, subject to the limitations provided in subsection (A)(6)(a) of this section; fifteen and thirty-eight one-hundredths (15.38) ; two (2) percent (15.38%) dedicated solely to the repayment and elimination of debt in the city’s “other capital projects” fund subject to the 28 5 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates limitations provided in subsection (A)(6)(b) of this section; one (1)seven and sixty-nine one-hundredths (7.69) percent (7.69%) to street improvement programs; and two and thirty-one one-hundredths (2.31) three-tenths (0.3) percent (2.31%) to youth/teen programs. a. The four (4) percent allocation for street lighting is further contingent on the requirement that the city allocate the funds freed up by this revenue to the city’s capital improvement fund(s). After payment of all capital debt, uUnless otherwise allocated by council, these remaining funds must be applied equally to (i) information technology capital programs directed at funding long- and short-term hardware and software replacement and (ii) street capital programs, but further restricted to funding street maintenance, repair, and signage only. If the cost to install, operate, maintain, and repair street lighting is less than the four (4) percent allocation for these purposes, the full four (4) percent amount must still be allocated from the general fund to capital programs for the above-stated purposes. b. The two (2)fifteen and thirty-eight one-hundredths (15.38) percent (15.38%) internal tax allocation will be dedicated to the city’s capital improvements resources fund for the sole purpose of retiring all debt in the city’s other capital projects fund; however, in any event Tthis two (2) percent portion of the tax shall be eliminated on January 1, 2023, or on the first day of the year following the date the debt in this fund is fully retired, whichever occurs first. B. In computing the tax provided in subsection (A) of this section, the taxpayer may deduct from total gross income the following items: 1. The actual amount of credit losses and uncollectible receivables sustained by the taxpayer. 2. Amounts derived from transactions in interstate and foreign commerce which the city is prohibited from taxing under the laws and Constitution of the United States. 29 6 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates SECTION 2.- Amendment.Section 7.02.180 of the Kent City Code, entitled “Temporary water meters,” is hereby amended as follows: Sec. 7.02.180. Temporary water meters. A. When water service is required for a specific short-term duration, upon approval of the director of public works, a temporary water meter may be obtained from the water utility. B. Such meters shall only be used for a designated project and shall be promptly returned to the water utility upon completion of the project or at the end of sixty (60) days, whichever comes first. The meters are to be returned in the same condition as when rented, and the user shall be held responsible for any damage thereto including paying all repair or replacement costs. While in the user’s possession, the user shall be solely responsible for the meter and as such, should it be lost or stolen, the user shall pay the water utility the cost of its replacement. C. The director of public works shall require that a cash bond be deposited with the city prior to receipt of a temporary meter. The amount of the bond shall equal the replacement cost of the respective meter. Upon return of the meter, the payment of all outstanding charges including any meter repair or replacement costs, the cash bond shall be released back to the user. D. Temporary meters may be moved from one (1) hydrant to another within the same project; provided, the water utility is notified in advance of the proposed relocation and that hydrant wrenches are used to make all connections and disconnections. E. For each 100 cubic feet of water used with a temporary water meter, the rate charged will be $4.73 per 100 cubic feet of water used.The following temporary meter rates apply during the time periods listed below per one hundred (100) cubic feet of water used: 30 7 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Effective Date January 1 – December 31 12/31/1999 $2.30 01/01/2003 $2.42 01/01/2004 $2.54 01/01/2005 $2.67 All rates are also subject to a one-time temporary meter charge as follows: 1. Up to one and one-half (1-1/2) inch meter, fifty dollars ($50); 2. Two (2) inch and larger meter, one hundred dollars ($100). Payment shall be made in full upon return of the meter. If a meter is lost or stolen, payment for water used shall be based on an estimate made by the director of public works. SECTION 3.- Amendment.Section 7.02.300 of the Kent City Code, entitled “Water rates within the city,” is hereby amended as follows: Sec. 7.02.300. Water rates within the city. A.Water rates. The following staggered monthly rates apply during the time periods listed below to all water customers within served by the city limits of Kent. Within each time period, tThe lower rate applies per 100 cubic feet of water used for up to or equal to 7800 cubic feet per month, and the higher rate applies per 100 cubic feet of any water used in excess of 7800 cubic feet: WATER USE/CONSUMPTION Winter/Summer <=800cf: $2.40 >800cf: $4.73 Effective Date October 1 –April 30 May 1 – September 30 ≤ 700 ft3 > 700 ft3 ≤ 700 ft3 > 700 ft3 31 8 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Effective Date October 1 –April 30 May 1 – September 30 ≤ 700 ft3 > 700 ft3 ≤ 700 ft3 > 700 ft3 01/01/2005 $1.44 $1.95 $1.90 $2.42 06/01/2009 $2.13 $2.89 $2.81 $3.58 01/01/2010 $2.77 $3.75 $3.66 $4.66 01/01/2011 $2.85 $3.86 $3.77 $4.80 01/01/2012 $2.94 $3.98 $3.88 $4.94 01/01/2013 $3.03 $4.10 $3.99 $5.09 01/01/2014 $3.12 $4.22 $4.11 $5.24 All customers are also subject to a monthly demand charge for potable water service, dedicated fireline service, and water meters. For purposes of this chapter, a “dedicated fireline” constitutes the pipe(s) and appurtenances on private property that only supply water to the system riser for water-based fire protection systems, private hydrants, monitor nozzles, fire pump suctions, and tanks. The dedicated fireline begins after the property isolation device, and it contains water that will be used only when needed for fire protection purposes and so will become stagnant and non-potable. The fees for these monthly demand services are, which is as follows: Meter size or, for Dedicated Fireline, Pipe size (inches) Residential Charge Effective January 1, 201708 Commercial Charge Effective AprilJanuary 1, 201709 Dedicated Fireline Charge Effective JuneJanuary 1, 201709 5/8 x 3/4 $5.26 $6.05 $8.95 ≤3/4 $23.15 $29.10 $2.75 1 $8.9436.25 $10.2842.20 $15.213.21 32 9 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Meter size or, for Dedicated Fireline, Pipe size (inches) Residential Charge Effective January 1, 201708 Commercial Charge Effective AprilJanuary 1, 201709 Dedicated Fireline Charge Effective JuneJanuary 1, 201709 1-1/4 4.81 1-1/2 $13.6469.00 $15.6974.95 $23.226.42 2 $18.09108.30 $20.80114.25 $30.7810.27 3 $38.35173.80 $44.10179.75 $65.2725.67 4 $46.47265.50 $53.44271.45 $79.0951.33 6 $69.03 $79.38402.45 $117.48102.67 8 $88.50 $88.51533.45 $150.63173.25 10 $113.03 $129.98664.45 $192.37256.67 Meter size (inches) Charge Effective January 1, 2011 Charge Effective January 1, 2012 Charge Effective January 1, 2013 Charge Effective January 1, 2014 5/8 x 3/4 $11.99 $12.35 $12.72 $13.10 1 $20.37 $20.98 $21.61 $22.26 1-1/2 $31.09 $32.03 $32.99 $33.98 2 $41.22 $42.46 $43.73 $45.04 3 $87.39 $90.02 $92.72 $95.50 4 $105.90 $109.08 $112.35 $115.72 6 $157.31 $162.03 $166.89 $171.90 8 $201.70 $207.75 $213.98 $220.40 10 $257.58 $265.31 $273.27 $281.47 Beginning January 1, 2018, and on the first day of each calendar year thereafter, the total water rate for consumption, meters, and 33 10 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates dedicated fireline usage will adjust by the Consumer Price Index (CPI), specifically the CPI-W Seattle-Tacoma-Bremerton, measured from June 1 through June 1 of the previous calendar year, if the CPI-W reflects an upward adjustment from the previous annual June to June period. For the years 2018-2022 the adjustment will not exceed 2.4% of the total water rate, but after that, beginning January 1, 2023, any increase in the CPI will not be subject to this 2.4% limit. In order to simplify the rate-making structure, the finance director is authorized to amend the rate each year to reflect the CPI adjustment. B.Lifeline customers. The city council will establish eligibility criteria for lifeline customers. For lifeline-qualified water service customers within the city limits, the following rates apply for water use per 100 cubic feet: Effective Date January 1 – December 31 01/01/2005 $0.51 06/01/2009 $0.53 01/01/2010 $0.54 01/01/2011 $0.56 01/01/2012 $0.57 01/01/2013 $0.59 01/01/2014 $0.61 All lifeline rates are also subject to the monthly demand charge for service and meter as set forth in subsection (A) of this section. SECTION 4.- Repealer.Section 7.02.310 of the Kent City Code, entitled “Water rates outside city,” is hereby repealed in its entirety. Sec. 7.02.310 Water rates outside city. 34 11 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates A. Water rates. The following staggered rates apply during the time periods listed below to all customers outside the city limits of Kent. Within each time period, the lower rate applies per 100 cubic feet of water used for up to or equal to 700 cubic feet, and the higher rate applies per 100 cubic feet of water used in excess of 700 cubic feet: Effective Date October 1 – April 30 May 1 – September 30 ≤ 700 ft3 > 700 ft3 ≤ 700 ft3 > 700 ft3 01/01/2005 $1.90 $2.42 $2.32 $2.85 06/01/2009 $2.81 $3.58 $3.43 $4.22 01/01/2010 $3.66 $4.66 $4.46 $5.48 01/01/2011 $3.77 $4.80 $4.60 $5.65 01/01/2012 $3.88 $4.94 $4.74 $5.82 01/01/2013 $3.99 $5.09 $4.88 $5.99 01/01/2014 $4.11 $5.24 $5.02 $6.17 All customers are also subject to a monthly demand charge for service and meter, which is as follows: Meter size (inches) Charge Effective January 1, 2008 Charge Effective April 1, 2009 Charge Effective June 1, 2009 5/8 x 3/4 $5.26 $6.05 $8.95 1 $8.94 $10.28 $15.21 1-1/2 $13.64 $15.69 $23.22 2 $18.09 $20.80 $30.78 3 $38.35 $44.10 $65.27 4 $46.47 $53.44 $79.09 35 12 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Meter size (inches) Charge Effective January 1, 2008 Charge Effective April 1, 2009 Charge Effective June 1, 2009 6 $69.03 $79.38 $117.48 8 $88.50 $88.51 $150.63 10 $113.03 $129.98 $192.37 Meter size (inches) Charge Effective January 1, 2011 Charge Effective January 1, 2012 Charge Effective January 1, 2013 Charge Effective January 1, 2014 5/8 x 3/4 $11.99 $12.35 $12.72 $13.10 1 $20.37 $20.98 $21.61 $22.26 1-1/2 $31.09 $32.03 $32.99 $33.98 2 $41.22 $42.46 $43.73 $45.04 3 $87.39 $90.02 $92.72 $95.50 4 $105.90 $109.08 $112.35 $115.72 6 $157.31 $162.03 $166.89 $171.90 8 $201.70 $207.75 $213.98 $220.40 10 $257.58 $265.31 $273.27 $281.47 B. Lifeline customers. The city council will establish eligibility criteria for lifeline customers. For lifeline-qualified water service customers outside the city limits, the following rates apply for water use per 100 cubic feet: Effective Date January 1 – December 31 01/01/2005 $0.56 06/01/2009 $0.58 01/01/2010 $0.59 01/01/2011 $0.61 01/01/2012 $0.63 36 13 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Effective Date January 1 – December 31 01/01/2013 $0.65 01/01/2014 $0.67 All lifeline rates are also subject to the monthly demand charge for service and meter as set forth in subsection (A) of this section. SECTION 5.- Amendment.Section 7.04.280 of the Kent City Code, entitled “Schedule of charges for service,” is hereby amended as follows: Sec. 7.04.280. Schedule of charges for service.The following sanitary sewer service charges for city sanitary sewer service inside the city limits are in effect on the dates and in the amounts listed below. Sewer service charges for customers residing outside the city shall be the charges as on file in the city clerk’s office.King County imposes a sanitary sewer service charge for regional sewage treatment. These charges are passed through, without increase, directly to the city sanitary sewer utility customers. The King County pass-through charge for 20173 is known and established. It is expected, however, that King County will increase its pass-through charge over time. Accordingly, except for the 20173 charge, all other King County charges are estimates only. In order to simplify the rate-making structure, the finance director is authorized to amend King County’s pass-through charges at the time King County imposes new charges. Beginning January 1, 2018, and on the first day of each calendar year thereafter, the total sewer rate will adjust by the Consumer Price Index (CPI), specifically the CPI-W Seattle-Tacoma-Bremerton, measured from June 1 through June 1 of the previous calendar year, if the CPI-W reflects an upward adjustment from the previous annual June to June period. For the years 2018-2022 the adjustment will not exceed 2.4% of 37 14 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates the total sewer rate, but after that, beginning January 1, 2023, any increase in the CPI will not be subject to this 2.4% limit. In order to simplify the rate-making structure, the finance director is authorized to amend the rate each year to reflect the CPI adjustment. In addition, the year 2017 City rate for all types of service is subject to any CPI or King County rate increases; for the year 2018 the City rate will increase one-dollar and twenty-five cents (1.25) in addition to any CPI or King County rate increases; and for the year 2019 the City rate will increase fifty cents (.50) in addition to any CPI or King County rate increases. The following sanitary sewer service charges for city sanitary sewer service inside the city limits are in effect on the dates and in the amounts listed below. Sewer service charges for customers residing outside the city shall be the charges as on file in the city clerk’s office. Type of Service Charges per Month Effective on 1/1/20137City Sewer Rate Charges per Month Effective on 1/1/20148King County Sewer Rate† Charges per Month Effective on 1/1/20159Total Sewer Rate 1. Single-family residential dwelling, as defined in Chapter 15.02 KCC. $22.16 $44.22 $64.90 • City sewer rate $20.6817.27*$21.9317.96*$22.4318.68* • King County sewer rate $44.2239.79 $39.7944.22*$39.7944.22* • Total sewer rate $64.9057.06*$66.1557.75*$66.6558.47* 2. Two-family or multiple-family residential dwelling, as defined in Chapter 15.02 KCC, each unit separately metered and charged. $22.16 $44.22 $64.90 • City sewer $20.68*17.27 $21.93*17.96 $22.43*18.68 38 15 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates Type of Service Charges per Month Effective on 1/1/20137City Sewer Rate Charges per Month Effective on 1/1/20148King County Sewer Rate† Charges per Month Effective on 1/1/20159Total Sewer Rate rate • King County sewer rate $39.7944.22 $39.7944.22*$39.7944.22* • Total sewer rate $64.9057.06*$66.1557.75*$66.6558.47* 3. Single-family residential/lifeline: eligibility criteria for the lifeline utility rate set forth in KCC 7.01.080. $12.70 $44.22 $56.92 • City sewer rate $12.70 $12.85 $13.01 • King County sewer rate $39.7944.22 $39.7944.22*$39.7944.22* • Total sewer rate $52.49*$52.64*$52.80* 4. All other than service types 1, 2 and 3 shall be billed in accordance with the consumption of water and at the following rate,*except that no monthly bill shall be less than the single-family residential rate set forth in service type No. 1. $8.65*7.61 per 100 cubic feet per month $8.827.70*1 per 100 cubic feet per month $8.887.80*1 per 100 cubic feet per month †Estimated, based on adjustments issued by King County. *Beginning January 1, 2018, this rate will adjust annually based on the basic rate shown for service types 1 and 2 above, calculated on this formula: Total Sewer Rate/7.5 = price per 100 cubic ft. per month. SECTION 6.– Severability.If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. 39 16 Amend KCC 3.18.020, 7.04.280, and Ch. 7.02 KCC Re: Sewer and Water Rates SECTION 7.– Corrections by City Clerk or Code Reviser.Upon approval of the city attorney, the city clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 8.– Effective Date.Although the fees, rates, and charges established by this ordinance do not take effect until January 1, 2017, this ordinance shall take effect and be in force 30 days from and after its passage, as provided by law. SUZETTE COOKE, MAYOR ATTEST: SUE HANSON, INTERIM CITY CLERK APPROVED AS TO FORM: TOM BRUBAKER, CITY ATTORNEY PASSED:day of , 2016. APPROVED: day of , 2016. PUBLISHED: day of , 2016. I hereby certify that this is a true copy of Ordinance No. passed by the City Council of the City of Kent, Washington, and approved by the Mayor of the City of Kent as hereon indicated. (SEAL) SUE HANSON, INTERIM CITY CLERK P:\Civil\Ordinance\7 04 and 3 18 Sewer Rate Increase.docx 40 FINANCE Aaron BeMiller, Director Phone: 253-856-5260 Fax: 253-856-6255 Address: 220 Fourth Avenue S. Kent, WA. 98032-5895 DATE: August 1, 2016 TO: Operations Committee FROM: Aaron BeMiller, Finance Director SUBJECT: May Financial Report – Information Only MOTION: Information Only SUMMARY: The Finance Director will report on the May 2016 financial report. BUDGET IMPACT: BACKGROUND: 41 2016 Adj Budget 2016 YTD 2016 Est Actual Variance Favorable (Unfavorable) %Variance Favorable (Unfavorable) Revenues 87,662,060 39,203,523 90,168,360 2,506,300 2.9% Expenditures 88,632,030 30,201,155 87,756,790 875,240 1.0% Net Revenues Less Expenditures (969,970) 9,002,368 2,411,570 3,381,540 Beginning Fund Balance 15,372,499 15,372,499 15,372,499 Ending Fund Balance 14,402,529 24,374,867 17,784,069 Ending Fund Balance Detail: General Fund Reserves 11,559,919 14,803,269 13.0%16.9% Contingency for Unanticipated Costs 1,500,000 1,500,000 Strategic Opportunities Fund 425,000 425,000 Restricted for Annexation 917,610 1,055,800 Revenue Overview Expenditures Overview May 2016 Monthly Financial Report City of Kent, Washington General Fund Overview Summary Analysis through May show both revenues and expenditures ending the year favorable compared to budget, creating an overall favorable variance amount of nearly $3.4m. The current estimated ending fund balance reserves for 2016 calculates to 16.9% of estimated 2016 expenses. Revenues are estimated to end the year at $2.5m or 2.9% higher than budgeted. Most of the City's major revenue sources show favorable variances compared to budget, including sales tax ($709k), licenses and permits ($306k), and miscellaneous revenues ($343k). This is offset by unfavorable variances compared to budget for other taxes ($179k) and fines and forfeitures ($144k). Through May, all departments are remaining fairly close to budget. Any significant variances are discussed on the following pages. 42 Revenue Categories 2016 Adj Budget 2016 YTD 2016 Est Actual Variance Favorable (Unfavorable) %Variance Favorable (Unfavorable) Taxes: Property 22,210,230 11,772,361 22,314,400 104,170 0.5% Sales & Use 18,633,990 8,319,184 19,342,600 708,610 3.8% Utility 18,140,150 8,494,912 18,317,400 177,250 1.0% Business & Occupation 6,500,000 2,013,673 7,353,670 853,670 13.1% Other 1,100,100 274,000 920,500 (179,600) -16.3% Licenses and Permits 5,139,120 2,335,570 5,444,700 305,580 5.9% Intergovernmental Revenue 7,419,970 2,467,256 7,746,600 326,630 4.4% Charges for Services 4,627,290 2,219,129 4,638,700 11,410 0.2% Fines and Forfeitures 1,565,970 617,267 1,421,500 (144,470)-9.2% Miscellaneous Revenue 1,393,650 690,172 1,736,700 343,050 24.6% Transfers In 931,590 - 931,590 - Total Revenues 87,662,060 39,203,523 90,168,360 2,506,300 2.9% Variance Notes May 2016 Monthly Financial Report City of Kent, Washington General Fund Overview - Revenues Other Taxes: Estimated reduction of $200,000 due to the closure of a casino in the first quarter of 2015. The 2016 budget was not updated to reflect the closure. Variance analysis for revenues is provided for particular line items or those in which the estimated actual amount differs from the budgeted amount by at least 10% or minimum of $500,000. Miscellaneous Revenue: Continues a steady positive trend again this year, largely due to interest on investments. Year-end projection is expected to exceed budget by $343,050, which equates to 24.6%. B&O Taxes: Conservatively estimated to end the year nearly $860k over budget, due to onboarding and collection efforts of the expanded B&O team. 43 Prior Year Revenues Budgeted Revenues Actual Revenues January 5,234 4,899 4,829 February 4,537 5,263 5,138 March 6,375 7,118 6,546 April 15,434 14,001 16,091 May 6,025 6,815 6,600 June 5,793 6,138 0 July 6,619 5,508 0 August 4,702 4,683 0 September 6,462 6,411 0 October 15,775 14,340 0 November 5,636 5,753 0 December 8,678 6,731 0 Total 91,270 87,662 39,204 Prior Year Revenues Budgeted Revenues Actual Revenues January 0 0 0 February 167 173 199 March 718 678 719 April 8,857 8,468 9,550 May 1,667 2,163 1,305 June 110 125 0 July 25 36 0 August 87 94 0 September 573 483 0 October 8,564 8,452 0 November 1,084 1,362 0 December 164 177 0 Total 22,016 22,210 11,772 Prior Year Revenues Budgeted Revenues Actual Revenues January 1,435 1,429 1,461 February 1,817 1,867 2,026 March 1,414 1,347 1,519 April 1,408 1,335 1,575 May 1,493 1,539 1,739 June 1,333 1,363 0 July 1,456 1,542 0 August 1,681 1,674 0 September 1,605 1,581 0 October 1,478 1,553 0 November 1,718 1,696 0 December 1,745 1,708 0 Total 18,583 18,634 8,319 Sales Tax May 2016 Monthly Financial Report City of Kent, Washington General Fund Revenues ($ in Thousands) All Revenues Sources Property Tax $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16 Bud 15 Act 16 Act $0 $5,000 $10,000 $15,000 $20,000 $25,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16 Bud 15 Act 16 Act $0 $5,000 $10,000 $15,000 $20,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16 Bud 15 Act 16 Act 44 May 2016 Monthly Financial Report City of Kent, Washington General Fund Revenues ($ in Thousands) Prior Year Revenues Budgeted Revenues Actual Revenues January 1,965 1,978 2,115 February 1,578 1,533 1,708 March 1,560 1,495 1,584 April 1,529 1,825 1,597 May 1,459 1,378 1,491 June 1,393 1,308 0 July 1,497 1,691 0 August 1,513 1,283 0 September 1,518 1,473 0 October 1,446 1,484 0 November 1,451 1,314 0 December 1,242 1,379 0 Total 18,152 18,140 8,495 Prior Year Revenues Budgeted Revenues Actual Revenues January 11 7 1 February 18 52 2 March 103 148 165 April 1,784 1,704 1,383 May 77 245 737 June 52 121 0 July 1,790 1,339 0 August 115 200 0 September 77 102 0 October 1,893 1,326 0 November 254 283 0 December 2,505 2,072 0 Total 8,680 7,600 2,288 Prior Year Revenues Budgeted Revenues Actual Revenues January 1,444 1,387 1,252 February 957 921 1,203 March 2,579 2,631 2,559 April 1,477 1,292 1,986 May 1,329 1,381 1,328 June 2,905 2,989 0 July 1,461 1,408 0 August 1,305 1,319 0 September 2,690 2,678 0 October 2,006 1,597 0 November 1,129 1,000 0 December 3,000 2,474 0 Total 22,283 21,078 8,329 Utility Tax Other Taxes Other Revenues (Intergovernmental, Licenses & Permits, Charges for Service, Fines & Forfeits, and Misc Revenues) $0 $5,000 $10,000 $15,000 $20,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov 16 Bud 15 Act 16 Act $0 $2,000 $4,000 $6,000 $8,000 $10,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16 Bud 15 Act 16 Act $0 $5,000 $10,000 $15,000 $20,000 $25,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16 Bud 15 Act 16 Act 45 Department 2016 Adj Budget 2016 YTD 2016 Est Actual Variance Favorable (Unfavorable) %Variance Favorable (Unfavorable) City Council 351,780 124,359 319,200 32,580 9.3% Mayor's Office/City Clerk 2,415,270 987,516 2,362,000 53,270 2.2% Economic & Community Dev 6,026,570 2,182,501 5,891,700 134,870 2.2% Finance 2,644,570 1,084,313 2,634,380 10,190 0.4% Fire Contracted Services 3,537,380 1,418,662 3,518,600 18,780 0.5% Human Resources 2,133,970 629,835 1,875,300 258,670 12.1% Information Technology 480,010 214,420 512,600 (32,590)-6.8% Law 1,283,240 601,759 1,280,200 3,040 0.2% Municipal Court 3,042,040 1,262,132 3,033,700 8,340 0.3% Parks, Recreation & Comm Svcs 16,823,700 6,250,873 16,475,200 348,500 2.1% Police 34,664,570 14,285,610 34,646,900 17,670 0.1% Public Works 1,436,120 674,462 1,414,200 21,920 1.5% Non-Departmental 13,792,810 484,715 13,792,810 Total Expenditures 88,632,030 30,201,155 87,756,790 875,240 1.0% Variance Notes May 2016 Monthly Financial Report City of Kent, Washington General Fund Overview - Expenditures Human Resources - salary savings due to vacant positions. Variance analysis for expenditures is provided for particular departments or those in which the estimated actual amount differs from the budgeted amount by at least 10% or a minimum of $500,000. 46 2014 2015 2016 2016 2016 Actual Actual Adj Budget YTD Est Actual Beginning Fund Balance 7,471,860 *11,312,140 15,372,499 15,372,499 15,372,499 Revenues Taxes: Property 20,696,272 22,015,525 22,210,230 11,772,361 22,314,400 Sales & Use 17,761,585 18,583,057 18,633,990 8,319,184 19,342,600 Utility 17,775,687 18,151,853 18,140,150 8,494,912 18,317,400 Business & Occupation 303,600 7,656,220 6,500,000 2,013,673 7,353,670 Other 1,106,821 1,023,500 1,100,100 274,000 920,500 Licenses and Permits 5,818,615 5,827,474 5,139,120 2,335,570 5,444,700 Intergovernmental Revenue 7,515,935 7,783,935 7,419,970 2,467,256 7,746,600 Charges for Services 6,182,649 5,814,133 4,627,290 2,219,129 4,638,700 Fines and Forfeitures 1,284,798 1,660,366 1,565,970 617,267 1,421,500 Miscellaneous Revenue 1,533,392 1,756,485 1,393,650 690,172 1,736,700 Transfers In 931,217 996,921 931,590 - 931,590 Total Revenues 80,910,572 91,269,469 87,662,060 39,203,523 90,168,360 Expenditures City Council 293,125 298,884 351,780 124,359 319,200 Mayor's Office/City Clerk 1,927,073 2,211,861 2,415,270 987,516 2,362,000 Economic & Community Dev 5,251,662 5,345,212 6,026,570 2,182,501 5,891,700 Finance 2,363,613 2,419,039 2,644,570 1,084,313 2,634,380 Fire Contracted Services 3,422,675 3,513,988 3,537,380 1,418,662 3,518,600 Human Resources 1,167,331 1,039,875 2,133,970 629,835 1,875,300 Information Technology 349,002 456,328 480,010 214,420 512,600 Law 1,003,202 1,198,769 1,283,240 601,759 1,280,200 Municipal Court 2,849,954 2,988,951 3,042,040 1,262,132 3,033,700 Parks, Recreation & Comm Svcs 14,854,585 15,897,126 16,823,700 6,250,873 16,475,200 Police 31,263,200 32,992,234 34,664,570 14,285,610 34,646,900 Public Works 4,929,327 4,896,300 1,436,120 674,462 1,414,200 Non-Departmental 7,395,544 13,950,543 13,792,810 484,715 13,792,810 Total Expenditures 77,070,292 87,209,110 88,632,030 30,201,155 87,756,790 Net Revenues less Expenditures 3,840,280 4,060,359 (969,970)2,411,570 Ending Fund Balance 11,312,140 15,372,499 14,402,529 17,784,069 Ending Fund Balance Detail: General Fund Reserves 8,159,940 11,749,159 11,559,919 14,803,269 9.4%13.3% 13.0%16.9% Contingency for Unanticipated Costs 1,500,000 1,500,000 1,500,000 1,500,000 Strategic Opportunities Fund 425,000 425,000 425,000 425,000 Restricted for Annexation 1,652,200 1,698,340 917,610 1,055,800 * 2014 beginning fund balance reduced by $2,026,000 to reflect the prior period adjustment required to properly record the repayment owed to the Utility Funds. May 2016 Monthly Financial Report City of Kent, Washington General Fund 47 2014 2015 2016 % of thru May thru May thru May Budget Revenues Taxes: Property 10,618,747 11,409,299 11,772,361 363,061 3.2% 53.0% Sales & Use 6,828,888 7,567,306 8,319,184 751,877 9.9% 44.6% Utility 8,794,450 8,848,552 8,494,912 (353,640) -4.0% 46.8% Business & Occupation 292,705 1,707,457 2,013,673 306,216 17.9% 31.0% Other 311,513 286,781 274,000 (12,781) -4.5% 24.9% Licenses and Permits 2,152,422 1,771,696 2,335,570 563,873 31.8% 45.4% Intergovernmental Revenue 2,203,315 2,256,441 2,467,256 210,814 9.3% 33.3% Charges for Services 2,861,536 2,454,567 2,219,129 (235,438) -9.6% 48.0% Fines and Forfeitures 574,929 693,802 617,267 (76,534) -11.0% 39.4% Miscellaneous Revenue 542,556 609,759 690,172 80,413 13.2% 49.5% Transfers In - - - - Total Revenues 35,181,061 37,605,661 39,203,523 1,597,862 4.2% 44.7% Expenditures City Council 119,942 127,500 124,359 (3,141) -2.5% 35.4% Mayor's Office/City Clerk 834,297 874,822 987,516 112,694 12.9% 40.9% Economic & Community Dev 2,109,960 2,166,999 2,182,501 15,502 0.7% 36.2% Finance 832,351 879,115 1,084,313 205,198 23.3% 41.0% Fire Contracted Services 1,449,126 1,546,091 1,418,662 (127,430) -8.2% 40.1% Human Resources 515,009 445,978 629,835 183,857 41.2% 29.5% Information Technology 144,700 159,511 214,420 54,910 34.4% 44.7% Law 366,226 497,332 601,759 104,427 21.0% 46.9% Municipal Court 1,139,824 1,210,308 1,262,132 51,824 4.3% 41.5% Parks, Recreation & Comm Svcs 5,812,090 6,106,389 6,250,873 144,484 2.4% 37.2% Police 12,767,918 13,529,965 14,285,610 755,645 5.6% 41.2% Public Works *1,378,066 1,900,324 674,462 (1,225,861) -64.5% 47.0% Non-Departmental 125,576 81,282 484,715 403,432 496.3% 3.5% Total Expenditures 27,595,086 29,525,614 30,201,155 675,542 2.3% 34.1% * Most Public Works costs were moved to the Street Operating Fund effective January 1, 2016. Only costs allocated to the Panther Lake annexation remain in the General Fund. 2015-16 Variance May 2016 Monthly Financial Report City of Kent, Washington Year-to-Year Month Comparison General Fund 48 2014 2015 2016 2016 2016 Actual Actual Budget YTD Est Actual Operating revenues and expenditures only, capital is excluded. In instances where expenditures exceed revenues, fund balance is being utilized. Street Operations Revenues 10,654,053 11,793,043 11,945,140 4,951,359 12,692,650 Expenditures 10,351,988 9,072,561 14,551,090 4,029,032 13,762,750 Net Revenues Less Expenditures 302,065 2,720,483 (2,605,950)922,327 (1,070,100) LEOFF 1 Retiree Benefits Revenues 1,055,840 1,341,722 1,164,510 292,534 1,118,430 Expenditures 887,036 1,279,216 1,125,890 370,080 1,115,570 Net Revenues Less Expenditures 168,803 62,506 38,620 (77,546)2,860 Lodging Tax Revenues 249,581 279,878 210,230 84,667 276,000 Expenditures 71,441 257,164 188,500 66,982 162,300 Net Revenues Less Expenditures 178,140 22,714 21,730 17,685 113,700 Youth/Teen Programs Revenues 888,250 894,592 912,600 409,783 902,940 Expenditures 898,524 920,380 942,000 942,000 Net Revenues Less Expenditures (10,274)(25,788)(29,400)409,783 (39,060) Capital Resources Revenues 16,413,708 20,561,359 14,414,120 5,616,887 15,523,940 Expenditures 11,997,869 11,538,631 14,422,330 1,036,830 15,170,000 Net Revenues Less Expenditures 4,415,838 9,022,728 (8,210)4,580,057 353,940 Criminal Justice Revenues 3,780,757 4,753,967 3,953,990 1,951,443 4,105,100 Expenditures 3,096,924 2,965,408 4,552,105 1,119,590 3,587,950 Net Revenues Less Expenditures 683,833 1,788,558 (598,115)831,852 517,150 Community Development Block Grant Revenues 835,776 808,466 914,740 112,810 914,740 Expenditures 835,776 808,466 914,740 266,484 914,740 Net Revenues Less Expenditures (153,674) ShoWare Operating Revenues 3,456,124 1,680,882 1,065,810 350,138 1,389,290 Expenditures 980,046 518,720 835,930 138,334 411,650 Net Revenues Less Expenditures 2,476,077 1,162,163 229,880 211,804 977,640 Other Operating Revenues 134,073 143,726 140,280 21,880 140,280 Expenditures 70,478 64,765 140,280 37,212 109,280 Net Revenues Less Expenditures 63,595 78,961 (15,332)31,000 Water Utility Revenues 20,948,199 20,140,494 18,870,370 7,264,015 20,968,700 Expenditures 15,890,786 17,620,354 19,214,740 5,934,016 18,709,200 Net Revenues Less Expenditures 5,057,413 2,520,140 (344,370)1,329,998 2,259,500 Special Revenue Funds Enterprise Funds May 2016 Monthly Financial Report Other Funds Overview (Revenues and Expenditures) City of Kent, Washington 2015: Net revenues less expenditures include $2.27m street operating revenues returned from LID funded projects. These funds have been allocated to projects in the 2016 budget. 2016: Includes street and transportation revenues and costs moved from the General Fund. 49 2014 2015 2016 2016 2016 Actual Actual Budget YTD Est Actual Operating revenues and expenditures only, capital is excluded. In instances where expenditures exceed revenues, fund balance is being utilized. May 2016 Monthly Financial Report Other Funds Overview (Revenues and Expenditures) City of Kent, Washington Sewer/Drainage Utility Revenues 46,608,123 48,525,436 46,250,710 19,851,459 47,497,165 Expenditures 43,535,541 47,086,396 46,992,300 15,405,269 47,419,180 Net Revenues Less Expenditures 3,072,581 1,439,040 (741,590)4,446,191 77,985 Solid Waste Utility Revenues 575,750 257,988 624,300 Expenditures 365 253,280 163,106 258,950 Net Revenues Less Expenditures (365)322,470 94,882 365,350 Golf Complex Revenues 2,489,362 2,661,490 2,774,450 881,446 2,630,000 Expenditures 2,693,040 2,867,873 3,143,490 1,138,064 3,126,000 Net Revenues Less Expenditures (203,678)(206,383)(369,040)(256,618)(496,000) Fleet Services Revenues 4,425,076 4,537,950 4,674,240 1,995,620 4,766,250 Expenditures 3,955,111 3,194,529 5,892,350 1,370,375 5,521,090 Net Revenues Less Expenditures 469,965 1,343,420 (1,218,110)625,245 (754,840) Central Services Revenues 356,338 372,070 422,320 162,492 402,330 Expenditures 336,633 350,962 401,760 182,012 352,000 Net Revenues Less Expenditures 19,704 21,108 20,560 (19,521)50,330 Information Technology Revenues 6,878,827 7,603,220 7,127,530 3,120,802 7,549,900 Expenditures 6,130,328 6,708,773 7,481,090 2,630,670 7,424,680 Net Revenues Less Expenditures 748,499 894,447 (353,560)490,132 125,220 Facilities Revenues 5,096,650 5,429,412 5,382,650 2,235,059 5,372,930 Expenditures 4,673,883 5,527,155 5,402,190 1,771,058 5,185,180 Net Revenues Less Expenditures 422,768 (97,744)(19,540)464,001 187,750 Unemployment Revenues 380,356 397,641 402,720 155,758 412,100 Expenditures 112,106 98,860 401,740 94,670 149,200 Net Revenues Less Expenditures 268,250 298,781 980 61,088 262,900 Workers Compensation Revenues 1,506,197 1,095,382 1,074,910 440,738 1,118,820 Expenditures 80,344 681,822 1,495,730 440,991 1,238,550 Net Revenues Less Expenditures 1,425,853 413,560 (420,820)(253)(119,730) 2015: Revenues reflect 2015-16 rate reduction, with GF savings going to the CR Fund to reduce the deficit. Employee Health & Wellness Revenues 9,626,446 10,487,102 10,210,310 3,970,816 10,525,400 Expenditures 9,809,909 11,298,096 11,583,040 5,146,388 11,554,000 Net Revenues Less Expenditures (183,463)(810,993)(1,372,730)(1,175,572)(1,028,600) Internal Service Funds 50 2014 2015 2016 2016 2016 Actual Actual Budget YTD Est Actual Operating revenues and expenditures only, capital is excluded. In instances where expenditures exceed revenues, fund balance is being utilized. May 2016 Monthly Financial Report Other Funds Overview (Revenues and Expenditures) City of Kent, Washington Liability Insurance Revenues 543,969 1,135,932 1,187,110 475,294 1,141,670 Expenditures 1,543,321 1,187,054 1,926,880 1,293,055 1,782,590 Net Revenues Less Expenditures (999,353)(51,122)(739,770)(817,762)(640,920) 2014: Revenues reflect a one-time adjustment to reduce cash reserves. 2015: Revenues reflect 2015-16 rate reduction, with GF savings going to the CR Fund to reduce the deficit. Property Insurance Revenues 568,107 582,938 612,050 255,289 612,260 Expenditures 508,423 471,003 604,600 241,693 601,200 Net Revenues Less Expenditures 59,684 111,935 7,450 13,596 11,060 51 2014 2015 2016 thru May thru May thru May Operating revenues and expenditures only, capital is excluded. Street Operations Revenues 3,380,383 3,400,493 4,951,359 1,550,866 45.6% Expenditures 931,389 1,719,051 4,029,032 2,309,981 134.4% Net Revenues Less Expenditures 2,448,994 1,681,442 922,327 2016 includes street and transportation revenues and costs moved from the General Fund. LEOFF 1 Retiree Benefits Revenues 273,936 290,558 292,534 1,976 0.7% Expenditures 359,415 538,944 370,080 (168,864)-31.3% Net Revenues Less Expenditures (85,479)(248,386)(77,546) 2015 claims were up dramatically compared to 2014, while 2016 thru April is consistent with past years. Lodging Tax Revenues 70,490 76,044 84,667 8,623 11.3% Expenditures 14,529 20,790 66,982 46,192 222.2% Net Revenues Less Expenditures 55,962 55,254 17,685 2016 expenditures reflect increased marketing activities. Youth/Teen Programs Revenues 416,306 414,492 409,783 (4,708)-1.1% Expenditures - - - Net Revenues Less Expenditures 416,306 414,492 409,783 Capital Resources Revenues 3,530,692 4,644,876 5,616,887 972,011 20.9% Expenditures 59,599 337,503 1,036,830 699,326 207.2% Net Revenues Less Expenditures 3,471,093 4,307,373 4,580,057 Criminal Justice Revenues 1,543,677 1,538,580 1,951,443 412,863 26.8% Expenditures 1,054,132 1,179,825 1,119,590 (60,234)-5.1% Net Revenues Less Expenditures 489,545 358,755 831,852 2016 increase in revenues due to strong sales tax trends and an increase in seized assets. Community Development Block Grants Revenues 175,590 156,124 112,810 (43,314)-27.7% Expenditures 291,474 241,904 266,484 24,580 10.2% Net Revenues Less Expenditures (115,884)(85,779)(153,674) Lag in grant reimbursement for expenses incurred. ShoWare Operating Revenues 105,576 81,282 350,138 268,856 76.8% Expenditures 188,771 28,070 138,334 110,264 392.8% Net Revenues Less Expenditures (83,195)53,212 211,804 2016 reveues include $225k for the ice plant settlement. 2015-16 Variance Year-to-Year Month Comparison May 2016 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Special Revenue Funds 2016 increase in revenues due to strong REET and sales tax trends. 2015 expenditures reflect one-time land acquisition costs; 2016 includes Pine Tree Park settlement. 52 2014 2015 2016 thru May thru May thru May Operating revenues and expenditures only, capital is excluded. 2015-16 Variance Year-to-Year Month Comparison May 2016 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Other Operating Revenues 1,500 2,220 21,880 19,660 885.6% Expenditures 18,248 6,469 37,212 30,742 475.2% Net Revenues Less Expenditures (16,748)(4,249)(15,332) Includes City Art Program, Neighborhood Matching Grants and Human Services Emergency Programs Water Utility Revenues 6,884,737 6,619,388 7,264,015 644,627 9.7% Expenditures 6,665,052 6,052,917 5,934,016 (118,901)-2.0% Net Revenues Less Expenditures 219,685 566,471 1,329,998 Sewer/Drainage Utility Revenues 22,621,450 19,260,635 19,851,459 590,825 3.1% Expenditures 14,806,148 14,866,329 15,405,269 538,939 3.6% Net Revenues Less Expenditures 7,815,302 4,394,306 4,446,191 Solid Waste Utility Revenues 257,988 257,988 100.0% Expenditures 163,106 163,106 100.0% Net Revenues Less Expenditures 94,882 Solid Waste Utility established in 2016. Golf Complex Revenues 869,690 976,230 881,446 (94,784)-9.7% Expenditures 1,052,516 1,029,821 1,138,064 108,243 10.5% Net Revenues Less Expenditures (182,826)(53,592)(256,618) 2016 revenues down due to inclement weather conditions in Q1. Fleet Services Revenues 1,829,006 1,906,223 1,995,620 89,397 4.7% Expenditures 1,515,469 976,581 1,370,375 393,794 40.3% Net Revenues Less Expenditures 313,537 929,642 625,245 Central Services Revenues 148,407 167,815 162,492 (5,323)-3.2% Expenditures 150,890 163,713 182,012 18,299 11.2% Net Revenues Less Expenditures (2,484)4,101 (19,521) Information Technology Revenues 2,808,778 2,902,258 3,120,802 218,544 7.5% Expenditures 2,329,753 2,594,876 2,630,670 35,794 1.4% Net Revenues Less Expenditures 479,025 307,382 490,132 Internal Service Funds Enterprise Funds 53 2014 2015 2016 thru May thru May thru May Operating revenues and expenditures only, capital is excluded. 2015-16 Variance Year-to-Year Month Comparison May 2016 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Facilities Revenues 2,123,532 2,199,639 2,235,059 35,420 1.6% Expenditures 1,634,898 1,709,860 1,771,058 61,198 3.6% Net Revenues Less Expenditures 488,634 489,779 464,001 Unemployment Revenues 156,804 165,117 155,758 (9,358)-5.7% Expenditures 60,567 56,632 94,670 38,038 67.2% Net Revenues Less Expenditures 96,237 108,484 61,088 Workers Compensation Revenues 600,639 453,344 440,738 (12,606)-2.8% Expenditures 333,552 363,549 440,991 77,442 21.3% Net Revenues Less Expenditures 267,087 89,795 (253) Employee Health & Wellness Revenues 4,110,914 4,336,559 3,970,816 (365,743)-8.4% Expenditures 4,087,622 4,575,736 5,146,388 570,651 12.5% Net Revenues Less Expenditures 23,292 (239,177)(1,175,572) Liability Insurance Revenues 830,815 473,057 475,294 2,237 0.5% Expenditures 895,128 970,388 1,293,055 322,667 33.3% Net Revenues Less Expenditures (64,314)(497,332)(817,762) Property Insurance Revenues 236,711 242,902 255,289 12,387 5.1% Expenditures 268,543 249,893 245,771 (4,122)-1.6% Net Revenues Less Expenditures (31,832)(6,991)9,518 54 2016 2016 2016 2016 Beginning Fund Balance Estimated Revenues Estimated Expenditures Ending Fund Balance Operating funds only, capital funds are excluded. General Fund 15,372,499 90,168,360 87,756,790 17,784,069 Street Operations 4,092,055 12,692,650 13,762,750 3,021,955 LEOFF 1 Retiree Benefits 1,093,532 1,118,430 1,115,570 1,096,392 Lodging Tax 394,516 276,000 162,300 508,216 Youth/Teen Programs 121,275 902,940 942,000 82,215 Capital Resources 5,775,064 15,523,940 15,170,000 6,129,004 Criminal Justice 3,981,627 4,105,100 3,587,950 4,498,777 Community Development Block Grants 914,740 914,740 ShoWare Operating 1,596,543 1,389,290 411,650 2,574,183 Other Operating 364,242 140,280 109,280 395,242 Water Utility 8,158,504 20,968,700 18,709,200 10,418,004 Sewer/Drainage Utility 10,093,986 47,497,165 47,419,180 10,171,971 Solid Waste Utility 365 624,300 258,950 365,715 Golf Complex (3,043,675) 2,630,000 3,126,000 (3,539,675) Fleet Services 4,301,237 4,766,250 5,521,090 3,546,397 Central Services (46,226) 402,330 352,000 4,104 Information Technology 2,808,737 7,549,900 7,424,680 2,933,957 Facilities 1,672,947 5,372,930 5,185,180 1,860,697 Unemployment 1,038,938 412,100 149,200 1,301,838 Workers Compensation 2,541,813 1,118,820 1,238,550 2,422,083 Employee Health & Wellness 6,122,922 10,525,400 11,554,000 5,094,322 Liability Insurance 2,452,656 1,141,670 1,782,590 1,811,736 Property Insurance 348,579 612,260 601,200 359,639 Internal Service Funds General Fund May 2016 Monthly Financial Report City of Kent, Washington Fund Balances Special Revenue Funds Enterprise Funds 55 This page intentionally left blank 56 Kent Council Operations Committee Consolidating Budget Adjustment FINANCE Aaron BeMiller, Director Phone: 253-856-5260 Fax: 253-856-6255 Address: 220 Fourth Avenue S. Kent, WA. 98032-5895 DATE: August 1, 2016 TO: Operations Committee FROM: Aaron BeMiller, Director SUBJECT: Director’s Report – Information Only MOTION: Information Only SUMMARY: The Finance Director will report out financial or operational item(s). BUDGET IMPACT: n/a BACKGROUND: n/a 57 This page intentionally left blank 58 MAYOR’S OFFICE Derek Matheson, Chief Administrative Officer Phone: 253-856-5700 Fax: 253-856-6050 Address: 220 Fourth Avenue S. Kent, WA. 98032-5895 DATE: August 2, 2016 TO: Operations Committee FROM: Derek Matheson, CAO SUBJECT: 2nd Quarter Procurement Report MOTION: Informational only. SUMMARY: The city council adopted a new procurement policy in 2015 that requires staff to provide a quarterly report to council on new procurements over specified dollar amounts and not previously approved by the city council, specifically all contracts/agreements over $25,000 and all leases/agreements that convey an interest in real property. The attached report is for the first quarter of 2016. EXHIBITS: Report is attached BUDGET IMPACT: N/A 59 CONTRACTS GREATER THAN $25,000 NOT APPROVED BY COUNCIL QTR CONTRACT NO.CONTRACTOR'S NAME PROJECT NAME TERM CONTRACT AMOUNT APPROVAL AUTHORITY DEPARTMENT Q2 PW16-129 GeoEngineers Inc James Street Pump Station 4/1/2016-1/31/2017 $34,489.00 Mayor Public Works Q2 PK16-144 Washington State Slo-pitch Umpires Association 2016 Softball Umpires Goods & Services Agreement 4/14/2016-9/30/2016 $55,000.00 Mayor Parks Q2 PW16-178 Shearer Design LLC S 224th St Project 5/3/2016-12/31/2016 $60,070.80 Mayor Public Works Q2 EC16-183 Seattle Thunderbirds Marketing Package that includesncludes VisitKent.com Logo and Website 5/5/2016-5/5/2017 $49,400.00 Mayor Economic and Community Development Q2 PW16-202 Graybar Electric Company Inc Street Light Poles 5/16/2016-7/1/2016 $52,527.15 Mayor Public Works Q2 IT16-220 Solarwinds Inc 2016-2017 Solarwinds Annual Maintenance Renewal 5/28/2016-5/27/2017 $26,529.68 Mayor IT Q2 PD16-236 Seattle, City of 2015 Justice Assistance Grant (JAG)$45,796.00 Mayor Police Department Q2 AD16-239 Northwest Research Group, LLC City of Kent Resident Survey 6/10/2016-8/31/2016 $45,087.00 Department Director Administration Q2 PW16-242 Duke's Root Control Inc.Sanitary Sewer Root Removal 6/16/2016-8/31/2016 $40,000.00 Department Director Public Works Q2 PW16-251 Integra Realty Resources S. 224th/228th St. Project Phase II 6/14/2016-5/15/2017 $30,500.00 Department Director Public Works Q2 EC16-250 Perma Cold Re-pipe suction lines Brine Chiller 6/10/2016-8/31/2016 $28,310.00 Mayor ECD Q2 PD16-256 North Star Construction and Environmental LLC Firing Range Floor Grinding and Sealing 6/20/2016-7/8/2016 $33,873.82 Mayor Police Department Q2 PW16-263 JECB 2016 Asphalt Overlays 6/24/2016-12/31/2017 $29,780.00 Mayor Public Works Q2 PK16-265 Maxon Furniture / Smart Office Environments LLC Furniture Purchase and Installation - New Detective Office 6/28/2016-7/31/2016 $31,064.48 Mayor Parks Q2 PK16-266 Cook Security Group Security Camera Replacement Project: Commons, PWO, SC, Riverbend 6/27/2016-8/31/2016 $32,095.35 Mayor Parks Q2 SHO16-001 CED LED Lighting Project 5/1/2016-6/30/2016 $148,219.20 CAO Showare Q1 PW16-010 Otak Inc James St Sidewalk Improvements 1/4/2016-3/30/2016 $26,500.00 Mayor Public Works Q1 PK16-013 Northwest Playground Equipment Linda Heights Playground Renovation 1/11/2016-3/11/2016 $26,645.76 Mayor Parks Q1 PW16-022 Department of Ecology WQSWCAP-1517-KENTPW-00060 NPDES Grant - Permit Compliance Activities - No match grant 7/1/2015-3/31/2017 (signed by Mayor 1/15/2016) $50,000.00 Mayor Public Works 60 CONTRACTS GREATER THAN $25,000 NOT APPROVED BY COUNCIL QTR CONTRACT NO.CONTRACTOR'S NAME PROJECT NAME TERM CONTRACT AMOUNT APPROVAL AUTHORITY DEPARTMENT Q1 HR13-088-002 Aduro (formerly Worksite Wellness LLC) Amendment 1 Master Services Agreement Workshite Wellness - citywide wellness program 1/1/2016-12/31/2017 (renewing automatically) $36,000 Mayor Human Resources Q1 PW16-029 Holaday-Parks Inc Guiberson Reservoir 2/1/20216-12/31/2016 $57,319.57 Mayor Public Works Q1 EC16-032 VanNess Feldman Federal Lobbyist 2/2/2016-12/31/2016 $56,000.00 Mayor Economic and Community Development Q1 PK16-040 Northwest Playground Equipment Service Club Playground Equipment 2/1/2016-5/9/2016 $26,198.64 Mayor Parks Q1 PW16-048 72nd Ave S Extension Engineering Construction Support 2/10/2016-3/31/2017 $33,820.80 Mayor Public Works Q1 PK16-049 Highline School District No 401 Camp Waskowitz 8/1/2016-8/5/2016 (signed by Mayor 2/16/2016) $40,280.00 Mayor Parks Q1 PK16-050 Eastside LLC dba Eastside Electric Hogan Park Light Pole Conduit Repair 1/27/2016-4/1/2016 $32,061.60 Mayor Parks Q1 IT16-056 ePlus Technology Inc 2016-2017 ePlus Storage Annual Support & Maintenance 2/5/2016-2/5/2017 $28,853.25 Mayor IT Q1 PW16-063 GeoEngineers Inc S 212th St Erosion Repair 2/23/2016-12/31/2016 $27,283.00 Mayor Public Works Q1 PW16-065 AmTest Inc Routine Bacteriological Testing 2/28/2016-3/1/2018 $47,731.00 Mayor Public Works Q1 PK16-095 Site Workshop LLC Kent Memorial Park Playground Renovation Project Design 3/18/2016-11/30/2016 $32,300.00 Mayor Parks Q1 PW16-098 A Plus Demolition & Excavation Recycling Events 3/18/2016-12/31/2016 $30,000.00 Mayor Public Works Q1 PW16-103 GeoEngineers Inc South 208th Street Road Repairs 3/22/2016-12/31/2016 $38,076.00 Mayor Public Works Q1 SHO15-001 NCSI Concessions Menu Reader Boards 11/1/2015-2/29/2016 $37,047.24 General Manager Showare 61