MSR G1 5 Earlimart Jan06

CHAPTER 5 – EARLIMART PUD MUNICIPAL SERVICE REVIEW EXECUTIVE SUMMARY This section provides an overview of the written determinations of the Earlimart Public Utility District (PUD) Municipal Service Review (MSR). As part of its review of municipal services, the Tulare County Local Agency Formation Commission (LAFCO) is required to prepare a written statement of its determination with respect to each of the following: 1) Growth and population projections for the affected area; 2) Infrastructure needs and deficiencies; 3) Financing constraints and opportunities; 4) Cost avoidance opportunities; 5) Opportunities for rate restructuring; 6) Opportunities for shared facilities; 7) Government structure options; 8) Evaluation of management efficiencies; and 9) Local accountability and governance. These requirements are established by AB 2838, the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000. The Earlimart PUD MSR identifies the following written determinations: Written Determinations 1) Growth and Population 1. The Earlimart CDP Boundary, as depicted in the 2003 Tulare County Data Book (Census 2000), is not consistent with the current District Boundary, indicating that the CDP population may not be representative of the District population. 2. Census 2000 data indicates that Earlimart had a population of 6,583 as of January 2000. According to PUD staff, the population varies between 6,000 and 8,000 persons as grape workers are attracted to the area during summer months. 3. Between 1990 and 2000, according to U.S. Census Bureau data, the Earlimart community grew in population from 5,881 to 6,583, corresponding to an average annual growth rate of 1.1% 4. It is likely that the Earlimart community will continue to grow at an average annual rate between 1% and 2% depending upon land use zoning established by the Tulare County General Plan Update and other factors. Using an average annual growth rate between 1% and 2%, the Earlimart community would reach an estimated year 2025 population between 8,450 and 10,800. 2) Infrastructure Needs and Deficiencies Domestic Water 1. The District’s water system supports 1,485 total service connections including 57 commercial connections, 1,424 residential connections, and 4 school connections. 2. In 2000 the District began requiring water meters for all new development but very little development has occurred since then indicating that the majority of the District’s water connections are currently un-metered. Water meters will also be installed on existing properties when they change ownership. Earlimart Public Utility District MSR Page 5-1 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 3. Assuming 1,500 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Earlimart PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,100 GPM (1,500 GPM fire flow, and 1,600 GPM domestic demand) for a period of two hours while maintaining a minimum pressure of 25 PSI to each lot served. The District’s water system is capable of delivering a source flow of 3,300 GPM, and includes pneumatic pressure tanks for storage, indicating that the system currently meets the requirements of the Tulare County Improvement Standards. 4. Based upon a calculation performed in accordance with General Order 103, published by the California Public Utilities Commission, it is estimated that the District’s current water system could support approximately 200 additional EDUs. 5. It is likely that the District will need to continue to repair and/or replace older pipelines in the water system. Additionally, it is likely that the District will need to supplement its water supply to support additional development within its SOI (i.e. the addition of wells to the system). 6. It is recommended that LAFCO complete a comprehensive review of any water system planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area. Sanitary Sewer 1. The Districts sewer system currently supports 1,485 total service connections including 57 commercial connections, 1,424 residential connections, and 4 school connections. 2. The District has applied for $750,000 grant to install a new sewer line. The District will need to match the grant with $250,000. An additional 15” trunk line will be added under Washington Street to Road 128 towards the plant, to the west of Earlimart. The District indicated that no additional development is to be approved prior to the installation of the new trunk line. 3. The Districts WWTF is operated under the provisions of Order No. 98-140 issued by the California RWQCB. The District currently complies with the provisions of the Order. 4. As prescribed by Order No. 98-140, when a California registered civil engineer has certified that the WWTF can reliably treat 1.24 MGD, the monthly average discharge shall not exceed 1.24 MGD; otherwise the monthly average discharge shall not exceed 0.80 MGD. District staff has indicated that the average dry weather flow is approximately 0.88 MGD. 5. The District’s collection system is in adequate operating condition as there is no significant inflow and infiltration during winter months. 6. Upon an engineers certification to reliably treat 1.24 MGD the WWTF would have additional capacity to treat approximately 360,000 GPD. Based upon an available capacity of 360,000 GPD, it is estimated that approximately 600 additional connections (EDUs) to the system could be supported. Earlimart Public Utility District MSR Page 5-2 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 7. Although there is remaining capacity, the District indicated that the WWTF was constructed in 1956 and needs upgrading including electrical upgrades. Intermediate upgrades to the plant occurred in 1973 and 1986. 8. It is recommended that LAFCO complete a comprehensive review of any sanitary sewer system and/or WWTF planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area including funding mechanisms for infrastructure improvements. 3) Financing Constraints and Opportunities 1. The District prepares a comprehensive and thorough annual budget that clearly describes the services provided to residents and the funds expended for those services. 2. The District generally requires new development projects to construct the necessary infrastructure to serve their development. A program of developer obligated infrastructure improvements provides for the installation of physical infrastructure to serve development sites and therefore relieves the financial obligation of the District. 3. Developers are also required to pay fees for rights to water and sewer capacity, which are ultimately used by the District for capital capacity improvements. These fees are set by the Board of Directors by resolution, and are allocated to a restricted reserve account. 4. The District’s budget for fiscal year 2004-05 included contingency funds of $90,070. As of July 1, 2004, the District had a cash balance of $1,000,000, of which $300,000 is reserved for a new water well, and $500,000 is reserved for sewer line expansions. 5. The District also generates revenue by investing its cash reserves in interest bearing accounts. Interest earnings are not projected for the upcoming F.Y. budget, but instead are reported in the beginning cash balance for the next F.Y. budget. 4) Cost Avoidance Opportunities 1. Each year, the District’s budget is reviewed with the District Board, District Engineer, and General Manager to ensure that the District continues to operate within the limits of its financial resources. 2. The District avoids unnecessary costs by contracting out professional services as needed including engineering, legal services, and other consulting services. 3. The District should continue to work with the development community to fund the construction of water and sewer infrastructure improvements that would serve new development sites. The District requires development projects to pay fees for water and sewer capacity rights, which are currently set at $1,500 and $1,000 per EDU for water and sewer connections, respectively. 5) Opportunities for Rate Restructuring 1. The Earlimart PUD charges monthly user fees and new connection fees for water and sewer. The fiscal year 2004-05 budget estimates revenues of $435,000 to be generated from current water and sewer user fees. Earlimart Public Utility District MSR Page 5-3 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 2. The Earlimart PUD rates are currently among the lowest compared to other service providers throughout the County, which is indicative of the District’s ability to provide efficient and affordable utility services to residents in the community. The District has not increased its flat rate fees since 1995. The District indicated that that the fees will be re-evaluated in the near future as a result of the need to expand the wastewater capacity and upgrade the wastewater treatment plant. 3. The District’s budget is structured to segregate costs associated with the construction of infrastructure to accommodate new development. Fees paid by developers are placed into a restricted reserve account, funds which are ultimately used by the District to construct capital capacity improvements to the District’s water and sewer systems. User fees are used for the operations of the District and the operation and maintenance of the District’s infrastructure. 6) Opportunities for Shared Facilities 1. Since the location of the Earlimart District Boundary is immediately adjacent to existing rural lands, the opportunity for sharing infrastructure does not readily exist. 7) Government Structure Options 1. There are no other service providers immediately adjacent to Earlimart’s SOI indicating that the potential for duplication of services is not present. For this reason, it is logical that the Earlimart PUD adequately plan for and assume water and sewer service within its SOI Boundary. 2. There are no foreseeable conditions that would indicate that development within the District’s SOI would result in a change in government structure. 3. Prior to development within its SOI area the District should complete master planning to address the infrastructure needs of affected areas and funding mechanisms to meet those needs. The District and/or County could also require developers to prepare specific plans prior to approving development within the District’s SOI. 4. The District will need to continually expand and improve its water and sewer infrastructure to accommodate development within its current District Boundary and SOI areas. 8) Evaluation of Management Efficiencies 1. Based upon information made available, it appears that the provisions of domestic water and sanitary sewer are managed in a cost effective, efficient manner that meets the needs of the community and ratepayers. 2. The Earlimart PUD is governed by a three member Board of Directors elected at large from within its boundaries. The Board is responsible for setting policy and general administrative procedures. 3. The District currently operates with a full time staff including a District Manager, an assistant, and two maintenance technicians. The staff is readily available to respond to the needs of customers. Earlimart Public Utility District MSR Page 5-4 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 4. The District contracts out for other services, including engineering, legal counsel, accounting, and other consulting services. 5. It is recommended that the District be available to respond to emergency situations during non- business hours as well. 9) Local Accountability and Governance 1. The District complies with the Brown Act open meeting law by holding regularly scheduled meetings in which the public is invited. Regularly scheduled meetings are held on the 10th of each month at 3:00 p.m. at the District office. Agendas for Board meetings are posted on-site at the District office. 2. The District adopts budgets and rate changes at hearings where the public is notified and invited. 3. The District should work with the Tulare County Resource Management Agency (RMA) and/or Tulare County LAFCO to have information regarding District affairs posted on the Tulare County RMA and/or LAFCO website. The District could provide information such as meeting times and locations, budgets, rates, ordinances, agendas, completed/upcoming projects, and other District affairs to Tulare County for posting on the County’s (RMA and/or LAFCO) website. Earlimart Public Utility District MSR Page 5-5 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.0 EARLIMART PUBLIC UTILITY DISTRICT 5.0.1 Background The requirement for Local Agency Formation Commissions (LAFCO) to conduct reviews of local municipal services was established with the passage of AB 2838, the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000. The bill passed the legislature, and was signed into law by Governor Davis on September 26, 2000. Municipal Service Reviews (MSRs) provide LAFCOs with an additional tool to fulfill their statutory responsibilities of promoting orderly growth and development, preserving the States finite open space and agricultural land resources, and working to ensure that high quality public services are provided to all Californians in the most efficient and effective manner. MSRs are a requirement of State annexation law and are required to be completed before the consideration of a Sphere of Influence (SOI) amendment or once every five years when a SOI amendment is not being considered. In July 2003, the Tulare County LAFCO Board adopted an MSR exemption policy, which identifies the agencies that would be subject to a review and the extent of that review. The agencies in Tulare County were divided into three (3) categories: agencies subject to a full comprehensive study; agencies subject to a questionnaire study; and agencies exempt from a MSR study. The Earlimart PUD is subject to a full comprehensive study. The policy further identifies that the services subject to review shall be: • Police protection • Fire protection • Water and wastewater • Solid waste collection and disposal • Streets and traffic circulation • Power generation and distribution • Health Care Earlimart, an unincorporated community in Tulare County, is located in the southwest portion of the County, southwest of Visalia. The Earlimart PUD, formed in December 1954, has a primary function of providing domestic water and sanitary sewer service to residents within the community. Domestic water and sanitary sewer collection, treatment, and disposal are the primary services provided by the Earlimart PUD that are subject to a municipal service review. Earlimart is located approximately 40 miles north of the City of Bakersfield. It lies 7 miles northeast of the City Limits of Delano. The community is long and linear in shape, and is bisected in an east-west direction by State Route (SR) 99 and the Union Pacific Railroad tracks. Earlimart is an agriculturally oriented service community surrounded on all sides by lands in agricultural production and vacant land. Cities and communities surrounding Earlimart include Delano to the south, Pixley to the north, and the communities of Ducor and Terra Bella to the east and northeast respectively, and the community of Richgrove to the southeast. Earlimart is approximately 13 miles east of the Tulare County/Kings County Line, and approximately 8 miles north of the Tulare County/Kern County Line. The current District Boundary and the currently adopted SOI for Earlimart are illustrated on Figure 5-1. Earlimart Public Utility District MSR Page 5-6 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 FIGURE 5-1 – EARLIMART PUD BOUNDARY AND SOI Source: Tulare County GIS Database (July 2004) Earlimart Public Utility District MSR Page 5-7 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 The following excerpt from the Tulare County LAFCO website (www.co.tulare.ca.us/lafco/info.asp) defines a SOI and the purpose it serves. A “Sphere of Influence” is the physical boundary and service area that a local governmental agency is expected to serve. Establishment of this boundary is necessary to determine which governmental agencies can provide services in the most efficient way to the people and property in any given area. The Sphere of Influence requirement also works to discourage urban sprawl by preventing overlapping of jurisdictions and duplication of services. The following discussions address the nine legislative factors required by the Cortese-Knox-Hertzberg Act; 1) Growth and population, 2) Infrastructure needs and deficiencies, 3) Financial constraints and opportunities, 4) Cost avoidance opportunities, 5) Opportunities for rate restructuring, 6) Opportunities for shared facilities, 7) Government structure options, 8) Evaluation of management efficiencies, and 9) Local accountability and governance. 5.1 GROWTH AND POPULATION The purpose of this section is to present historical and projected growth patterns and population projections to establish a baseline for the evaluation of the service needs of Earlimart. 5.1.1 Historical Data The Census Bureau, on a decennial basis, identifies and provides detailed information on all incorporated Cities along with several smaller unincorporated communities (termed Census Designated Places – CDPs). Each census, community profiles are developed and provide a wide range of information pertaining to population, demographics, housing information, household data, education and employment, income and poverty, and historical trends. The Earlimart CDP Boundary, as depicted in the 2003 Tulare County Data Book (Census 2000), is not consistent with the current District Boundary, indicating that the CDP population may not be representative of the District population. Census 2000 data indicates that Earlimart had a population of 6,583 as of January 2000. According to PUD staff, the population varies between 6,000 and 8,000 persons as grape workers are attracted to the area during summer months. Census 1990 data indicates that Earlimart had a population of 5,881 corresponding to an annual average growth rate between 1990 and 2000 of approximately 1.1%. The unincorporated areas of Tulare County grew from a population of 133,222 in 1990 to a population of 141,150 in 2000 corresponding to an average annual growth rate of approximately 0.6%. It is likely that the Earlimart community will continue to grow at an average annual rate between 1% and 2%, depending upon land use zoning established by the Tulare County General Plan Update and other factors. Using an average annual growth rate between 1% and 2%, the Earlimart community would reach an estimated year 2025 population between 8,450 and 10,800. 5.1.2 Written Determinations 1. The Earlimart CDP Boundary, as depicted in the 2003 Tulare County Data Book (Census 2000), is not consistent with the current District Boundary, indicating that the CDP population may not be representative of the District population. 2. Census 2000 data indicates that Earlimart had a population of 6,583 as of January 2000. According to PUD staff, the population varies between 6,000 and 8,000 persons as grape workers are attracted to the area during summer months. Earlimart Public Utility District MSR Page 5-8 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 3. Between 1990 and 2000, according to U.S. Census Bureau data, the Earlimart community grew in population from 5,881 to 6,583, corresponding to an average annual growth rate of 1.1% 4. It is likely that the Earlimart community will continue to grow at an average annual rate between 1% and 2% depending upon land use zoning established by the Tulare County General Plan Update and other factors. Using an average annual growth rate between 1% and 2%, the Earlimart community would reach an estimated year 2025 population between 8,450 and 10,800. Earlimart Public Utility District MSR Page 5-9 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.2 INFRASTRUCTURE NEEDS AND DEFICIENCIES The purpose of this section is to evaluate the infrastructure needs and deficiencies of Earlimart in terms of availability of resources, capacity to deliver services, condition of facilities, service quality, and levels of service. 5.2.1 Domestic Water Earlimart’s water supply is derived from four 600 feet deep underground wells, which pump at a consistent water level of approximately 250 feet. The four wells provide high quality water requiring no chlorination or treatment. The four wells have a total maximum production efficiency of 3,300 GPM, or 4.75 MGD. Wells are located throughout the community at the following locations: one in the southern portion of the community between Valente Road and SR 99; one located on property at the southeast corner of Tulare Street and Elm Street; one located on property at the southwest corner of Clay Street and Church Street; and one located on property at the corner of Mary Ann Avenue and Lane Road. The community water system supports 1,485 total service connections including 57 commercial connections, 1,424 residential connections, and 4 school connections. In 2000, Earlimart PUD started requiring water meters for all new development; however, very little development has occurred since then indicating that the majority of the Districts water system is un-metered. Water meters are also to be installed when properties change ownership. The total water production for each well by month (for year 2003) is contained in Table 5-1 below. TABLE 5-1 EARLIMART PUD GROUNDWATER WELL PRODUCTIONS Month Front Street Well Tulare Street Well Clay Street Well Mary Ann Ave Well January 2.195 mg 0 0 30.677 mg February 2.245 mg 0 0 29.317 mg March 4.739 mg 0.010 mg 0 30.051 mg April 4.852 mg 0.204 mg 0 30.322 mg May 9.370 mg 3.360 mg 4.068 mg 31.370 mg June 13.121 mg 2.258 mg 5.229 mg 34.488 mg July 13.690 mg 3.611 mg 14.826 mg 34.046 mg August 12.566 mg 3.042 mg 13.419 mg 35.303 mg September 8.521 mg 2.361 mg 11.596 mg 37.064 mg October 4.102 mg 0.092 mg 9.980 mg 34.841 mg November 2.629 mg 0.003 mg 0.593 mg 32.417 mg December 2.023 mg 0 0 28.622 mg Total Annual Production 80.053 mg 14.941 mg 59.711 mg 388.518 mg Notes: 1) mg = million gallons 2) Source: Earlimart PUD As indicated in Table 5-1, only two of the four wells were in production year round. The maximum production occurred in the month of July and totaled 66.173 million gallons, or approximately 203 acre- feet. The District indicated that engineering reports and evaluations of the water system are prepared and updated by Keller-Wegley Engineering, Inc. After several requests, these documents have not been provided making it difficult to make specific determinations with regard to the water infrastructure (capacity, condition, financing, planned improvements, etc.) of the District. It is likely that the District will need to continue to repair and/or replace older pipelines in the water system. Additionally, it is likely Earlimart Public Utility District MSR Page 5-10 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 that the District will need to supplement its water supply to support additional development within its SOI. It is recommended that LAFCO complete a comprehensive review of any water system planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area. Tulare County Improvement Standards require that the construction of water source facilities shall comply with the requirements of Bulletin No. 74, “Water Well Standards” prepared by the State of California Department of Water Resources. The Tulare County Improvement Standards also establish specific requirements for quantity and quality of water to be delivered to a system. Some of these requirements are summarized below. • The quantity of water delivered to the distribution system within a subdivision from all source and storage facilities for a period of two hours shall be the maximum domestic demand plus a fire flow quantity of not less than 500 GPM for single family residential, 1,500 GPM for multi-family residential, commercial, and light manufacturing, and 2,500 GPM for heavy manufacturing. • For systems up to 625 customer units (equivalent dwelling units) the domestic quantity shall not be less than Q = 100 + 25 * √N, and Q = 100 + N for more than 625 customer units at sufficient pressure to provide a minimum pressure of 25 PSI to each lot served; where Q equals the rate of flow in GPM delivered from the combined source facilities to the distribution system, and N equals the total number of customer units where each customer unit is equivalent to one for a single family dwelling on a normal subdivision lot. Other types of development shall be assigned appropriate customer unit values by the Engineer as experience with the distribution system or locality indicates. • The minimum source and domestic demand storage design requirements shall be in accordance with Plate No. WS-11 of Section IV of the Tulare County Improvement Standards. • The quality of water supplied for human consumption shall conform to Sections 3, 4 and 5 of the latest United States Public Health Service Drinking Water Standards. Samples will be taken and tests made by the County Department of Health Services for bacteriological determination of potability. • Chemical and physical tests for potability shall be performed by a commercial laboratory certified by the State Department of Health Services for performance of chemical and physical analysis and the costs thereof shall be borne by the sub-divider. Assuming 1,500 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Earlimart PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,100 GPM (1,500 GPM fire flow, and 1,600 GPM domestic demand) for a period of two hours while maintaining a minimum pressure of 25 PSI to each lot served. The District’s water system is capable of delivering a source flow of 3,300 GPM, and includes pneumatic pressure tanks for storage. An estimate of water system capacity can be calculated by using General Order 103, published by the California Public Utilities Commission. For the estimated water system capacity, the total supply source available is compared to a calculated total supply source required. Other factors that may affect the capacity of water systems, including but not limited to, water quality, low pressures, required storage, age Earlimart Public Utility District MSR Page 5-11 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 of system, and pipeline restrictions, are not considered. The estimated supply source required is calculated using the following equation, Q = (N)*(C)*(F) where, Required N = Number of customers served C = Gallon per minute constant: 5 to 9 for flat rate systems, 2 to 5 for metered systems F = Factor to reflect diversity (inversely proportional to the number of customers) Using an N value of 1,485, a C factor of 6.5, and an F factor of 0.30, the estimated total supply source required is calculated to be 2,896 GPM. With a total supply source available of 3,300 GPM, it is estimated that the current system could support approximately 200 additional equivalent dwelling units. These calculations indicate that the District’s water system is operating at approximately 88% of its capacity, indicating that an additional well will be required in the near future to support additional development. 5.2.2 Sanitary Sewer In addition to domestic water service, the Earlimart PUD provides sanitary sewer collection and treatment services to residents within the District. According to District staff, there are currently 1,485 connections to the Districts sewer system including 1,424 residential connections, 57 commercial connections, and 4 school connections. Raw sewage is collected in a series of collection pipes ranging in size from 6 to 15 inches and then transported to a WWTF that is owned and operated by the Earlimart PUD. There are three sewer lift stations in the system. The District has applied for $750,000 grant to install a new sewer line in which the District will match the grant with $250,000 in funding. An additional 15” trunk line will be added under Washington Street to Road 128 towards the plant, to the west of Earlimart. The District indicated that no additional development is to be approved until the new sewer line is in place. The District operates a WWTF located west of the community near the southeast quadrant of Avenue 56 and Road 120. The WWTF is operated under the provisions of Order No. 98-140 issued by the California Regional Water Quality Control Board. The WWTF consists of bar screen, an aerated grit chamber, two communitors in parallel, a clarigester, and oxidation ponds. Effluent from the oxidation ponds is stored in three retention ponds that have a total surface area of 20 acres. Order No. 98-140 prescribes that the monthly average discharge shall not exceed 0.8 MGD. The District indicated that recent improvements to the plant including the construction of additional oxidation ponds have brought the plants capacity up to 1.24 MGD. As prescribed by Order No. 98-140, when a California registered civil engineer has certified that the WWTF can reliably treat 1.24 MGD, the monthly average discharge shall not exceed 1.24 MGD. The District currently complies with the requirements specified in Order No. 98-140. The District has indicated that the daily flow during summer months is approximately 880,000 GPD and about 600,000 to 700,000 GPD during winter months indicating that there is no significant inflow and infiltration into the collection system during the winter months. This is an indication that the collection system is in adequate operating condition. Upon an engineer’s certification to reliably treat 1.24 MGD, the WWTF would have additional capacity to treat approximately 360,000 GPD. Based upon the available capacity at the WWTF, it is estimated that approximately 600 additional connections (EDUs) to the system could be supported. Although there is remaining capacity in the system, the District indicated that the plant was constructed in 1956 and needs upgrading including electrical upgrades. Intermediate upgrades to the plant occurred in 1973 and 1986 according to the Districts Engineer. Several requests have been made to obtain the District’s sewer planning documents but these documents were not made available for review at the time of this publication. It is recommended that LAFCO Earlimart Public Utility District MSR Page 5-12 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 complete a comprehensive review of any sanitary sewer system and/or WWTF planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area including funding mechanisms for infrastructure improvements. 5.2.3 Written Determinations Domestic Water 1. The District’s water system supports 1,485 total service connections including 57 commercial connections, 1,424 residential connections, and 4 school connections. 2. In 2000 the District began requiring water meters for all new development but very little development has occurred since then indicating that the majority of the District’s water connections are currently un-metered. Water meters will also be installed on existing properties when they change ownership. 3. Assuming 1,500 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Earlimart PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,100 GPM (1,500 GPM fire flow, and 1,600 GPM domestic demand) for a period of two hours while maintaining a minimum pressure of 25 PSI to each lot served. The District’s water system is capable of delivering a source flow of 3,300 GPM, and includes pneumatic pressure tanks for storage, indicating that the system currently meets the requirements of the Tulare County Improvement Standards. 4. Based upon a calculation performed in accordance with General Order 103, published by the California Public Utilities Commission, it is estimated that the District’s current water system could support approximately 200 additional EDUs. 5. It is likely that the District will need to continue to repair and/or replace older pipelines in the water system. Additionally, it is likely that the District will need to supplement its water supply to support additional development within its SOI (i.e. the addition of wells to the system). 6. It is recommended that LAFCO complete a comprehensive review of any water system planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area. Sanitary Sewer 1. The Districts sewer system currently supports 1,485 total service connections including 57 commercial connections, 1,424 residential connections, and 4 school connections. 2. The District has applied for $750,000 grant to install a new sewer line. The District will need to match the grant with $250,000. An additional 15” trunk line will be added under Washington Street to Road 128 towards the plant, to the west of Earlimart. The District indicated that no additional development is to be approved prior to the installation of the new trunk line. 3. The Districts WWTF is operated under the provisions of Order No. 98-140 issued by the California RWQCB. The District currently complies with the provisions of the Order. Earlimart Public Utility District MSR Page 5-13 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 4. As prescribed by Order No. 98-140, when a California registered civil engineer has certified that the WWTF can reliably treat 1.24 MGD, the monthly average discharge shall not exceed 1.24 MGD; otherwise the monthly average discharge shall not exceed 0.80 MGD. District staff has indicated that the average dry weather flow is approximately 0.88 MGD. 5. The District’s collection system is in adequate operating condition as there is no significant inflow and infiltration during winter months. 6. Upon an engineers certification to reliably treat 1.24 MGD the WWTF would have additional capacity to treat approximately 360,000 GPD. Based upon an available capacity of 360,000 GPD, it is estimated that approximately 600 additional connections (EDUs) to the system could be supported. 7. Although there is remaining capacity, the District indicated that the WWTF was constructed in 1956 and needs upgrading including electrical upgrades. Intermediate upgrades to the plant occurred in 1973 and 1986. 8. It is recommended that LAFCO complete a comprehensive review of any sanitary sewer system and/or WWTF planning reports prior to any SOI updates to ensure that proper facilities planning has taken place for any proposed SOI expansion area including funding mechanisms for infrastructure improvements. Earlimart Public Utility District MSR Page 5-14 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.3 FINANCING OPPORTUNITIES AND CONSTRAINTS The purpose of this section is to evaluate the capability of Earlimart PUD to finance needed improvements and services. 5.3.1 Annual Budget LAFCO should consider the ability of the District to pay for improvements or services associated with annexed sites. This planning can begin at the SOI stage by identifying what opportunities there are to identify infrastructure and maintenance needs associated with future annexation and development, and identifying limitations on financing such improvements, as well as the opportunities that exist to construct and maintain those improvements. Based upon a review of the District’s fiscal year 2004-05 budget the District is in sound financial condition. The fiscal year 2004-05 budget is well organized, thorough, and clearly articulates the District’s future financial performance plans. The District prepares a traditional line item budget document that is divided into the following categories: • Available Resources • Estimated Revenues • Estimated Expenditures o Salaries and Employee Benefits o Services and Supplies o Appropriations The District adopts the budget each year and it is used as the spending plan for the District. The budget provides a framework for the District to address the following issues: reserves, revenues, expenditures, investments, and rates and fees. Using the fiscal year 2004-05 budget as basis for this discussion, the District has an operating budget of $652,570 that covers salaries and employee benefits totaling $157,000; outside services and supplies totaling $315,500; other charges totaling $90,000; and a contingency appropriation of $90,070. “Other charges” include $60,000 allocated towards building and improvements and $30,000 allocated towards equipment purchases. In addition, the District has $800,000 reserved for infrastructure improvements. The District generally requires new development projects to construct the necessary infrastructure to serve their development. A program of developer obligated infrastructure improvements provides for the installation of physical infrastructure to serve development sites and therefore relieves the financial obligation of the District. Developers are also required to pay fees for rights to water and sewer capacity, which are ultimately used by the District for capital capacity improvements including, but not limited to, additional wells, storage facilities, or capital WWTF improvements. These fees are set by the Board of Directors by resolution, and are allocated to a restricted reserve account. The District’s financial constraints involve the governmental structure and the desires of the people in the community to fund certain activities by establishing assessment districts or fees. The laws under which a PUD is governed provide the structure for funding activities. Key revenue sources for the Earlimart PUD include user fees, new connection fees, and property tax increments. The District also generates revenue by investing its cash reserves in interest bearing accounts. Interest earnings are not projected for the upcoming F.Y. budget, but instead are reported in the beginning cash balance for the next F.Y. budget. The District had a beginning (July 2004) cash balance of $1,000,000 of which $300,000 is reserved for the construction of a new water well, and $500,000 is reserved for sewer line expansions. Earlimart Public Utility District MSR Page 5-15 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 On the expenditures side, the District budgets for the services paid for by residents and provides for other expenses using property tax and, if appropriate, restricted reserve accounts. Key expenditures include personnel, services and supplies, and pass through revenues for projects. Based upon a review of the Districts budget for FY 2004-05, it was concluded that the District has no long term debt obligations. 5.3.2 Written Determinations 1. The District prepares a comprehensive and thorough annual budget that clearly describes the services provided to residents and the funds expended for those services. 2. The District generally requires new development projects to construct the necessary infrastructure to serve their development. A program of developer obligated infrastructure improvements provides for the installation of physical infrastructure to serve development sites and therefore relieves the financial obligation of the District. 3. Developers are also required to pay fees for rights to water and sewer capacity, which are ultimately used by the District for capital capacity improvements. These fees are set by the Board of Directors by resolution, and are allocated to a restricted reserve account. 4. The District’s budget for fiscal year 2004-05 included contingency funds of $90,070. As of July 1, 2004, the District had a cash balance of $1,000,000, of which $300,000 is reserved for a new water well, and $500,000 is reserved for sewer line expansions. 5. The District also generates revenue by investing its cash reserves in interest bearing accounts. Interest earnings are not projected for the upcoming F.Y. budget, but instead are reported in the beginning cash balance for the next F.Y. budget. Earlimart Public Utility District MSR Page 5-16 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.4 COST AVOIDANCE OPPORTUNITIES The purpose of this section is to identify practices or opportunities that may help to eliminate unnecessary costs. 5.4.1 Fiscal Structure The Districts budget process is designed to screen out unnecessary costs. A base budget is completed by the General Manager for review and discussion by the Board of Directors. Each year, the District’s budget is reviewed with the District Board, District Engineer, and General Manager to ensure that the District continues to operate within the limits of its financial resources. The District has adequate staff resources and administrative capabilities to provide the needed level of services to the residents within its boundaries. The District also avoids unnecessary costs by contracting out professional services including engineering, legal services, and other consulting services. The District should continue to work with the development community to fund the construction of water and sewer infrastructure improvements that would serve new development sites. The District requires development projects to pay fees for water and sewer capacity rights, which are currently set at $1,500 and $1,000 per equivalent dwelling unit (EDU) for water and sewer connections, respectively. If the SOI were expanded in the future, the District would assume fiscal responsibilities to construct and maintain the water and sewer infrastructure associated with the SOI and any territories that were annexed. LAFCO should consider the relative burden of new annexations to the District when it comes to its ability to provide water and sewer service, as well as capital maintenance and replacements required as a result of expanding the District Boundary. Opportunities exist at the time of annexation and development to introduce alternative methods of construction and maintenance of public or semi-public infrastructure to serve the future SOI/annexation areas. 5.4.2 Written Determinations 1. Each year, the District’s budget is reviewed with the District Board, District Engineer, and General Manager to ensure that the District continues to operate within the limits of its financial resources. 2. The District avoids unnecessary costs by contracting out professional services as needed including engineering, legal services, and other consulting services. 3. The District should continue to work with the development community to fund the construction of water and sewer infrastructure improvements that would serve new development sites. The District requires development projects to pay fees for water and sewer capacity rights, which are currently set at $1,500 and $1,000 per EDU for water and sewer connections, respectively. Earlimart Public Utility District MSR Page 5-17 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.5 OPPORTUNITIES FOR RATE RESTRUCTURING The purpose of this section is to identify opportunities to positively impact rates without decreasing service levels. 5.5.1 Fee Structure The Earlimart PUD charges monthly user fees and new connection fees for water and sewer. The fiscal year 2004-05 budget estimates revenues of $435,000 to be generated from current water and sewer fees. Tables 5-2 and 5-3 show a comparison of water and sewer rates and connection fees, respectively, for surrounding service providers. The tables also show the relationship between monthly service charges and average household incomes for the respective communities. Since some of the service providers charge a metered rate for water, it is necessary to calculate an average monthly bill based upon a specific amount of usage taken as 2,005 cubic feet, or approximately 15,000 gallons, per month for this analysis. TABLE 5-2 COMPARISON OF WATER RATES Average Service Provider Sample Monthly Bill Connection Fee Household Rate/Income Ratio Income Earlimart PUD $12.50 $1,500 $1,775/mo. 0.70% Ivanhoe PUD $9.50 $1,700 $2,171/mo. 0.44% Pixley PUD $20.00 $2,000 $1,942/mo. 1.03% Teviston CSD $30.00 $800 $2,014/mo. 1.49% Tipton CSD $24.00 $2,800 $2,198/mo. 1.09% Alpaugh JPA $55.00 $1,500 $1,974/mo. 2.79% Cutler PUD $18.00 $1,500 $2,028/mo. 0.89% Orosi PUD $19.08 $2,400 $2,533/mo. 0.75% Lemon Cove SD $10.01 $500 $2,361/mo. 0.42% London CSD $18.00 $1,400 $1,807/mo. 1.00% Lindsay-Strathmore ID $14.187 T&M $2,096/mo. 0.68% Poplar CSD $25.00 $1,750 $2,043/mo. 1.22% Richgrove CSD NA NA $1,907/mo. NA Springville PUD $23.42 $2,800 $2,023/mo. 1.16% Strathmore PUD $43.30 $1,150 $2,096/mo. 2.06% Terra Bella ID $12.438 $2,908 $2,109/mo. 0.59% Woodville PUD $27.28 $2,000 $2,123/mo. 1.28% Average $23.17 $1,780 $2,080/mo. 1.11% Notes: 1) Fee information obtained from service providers 2) Average household income based upon Census 2000 data 3) Rate/Income ratio calculated by dividing sample monthly bill by average household income 4) Sample monthly bill is calculated for a typical single family dwelling 5) NA=Not Available 6) T&M=Time and Material basis 7) Based on an average of four separate rates charged by the Lindsay-Strathmore Irrigation District 8) Based on potable water service provided by the Terra Bella Irrigation District 9)Richgrove CSD and Lindsay-Strathmore ID were omitted from the average calculations Earlimart Public Utility District MSR Page 5-18 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 As indicated in Table 5-2, the Earlimart PUD charges among the lowest monthly rates for domestic water service compared to other service providers throughout the County. The cost of domestic water service within Earlimart equates to approximately 0.70% of the average household income within the community. The Earlimart PUD water connection fee is also below average compared to other domestic water service providers throughout the County. TABLE 5-3 COMPARISON OF SEWER RATES Average Monthly Sewer Connection Service Provider Household Rate/Income Ratio3 User Fee (1 EDU)1 Fee1 Income2 Goshen CSD $32.00 $975 $2,359/mo. 1.36% Earlimart PUD $7.50 $1,000 $1,775/mo. 0.42% Ivanhoe PUD $9.50 $1,890 $2,171/mo. 0.44% Pixley PUD $15.00 $1,800 $1,942/mo. 0.77% Tipton CSD $8.00 $1,050 $2,198/mo. 0.36% Cutler PUD $22.00 $3,520 $2,028/mo. 1.08% Orosi PUD $22.97 $1,745 $2,533/mo. 0.91% Lemon Cove SD $4.50 $500 $2,361/mo. 0.19% London CSD $21.00 $1,990 $1,807/mo. 1.16% Poplar CSD $25.00 $1,300 $2,043/mo. 1.22% Richgrove CSD $18.00 $750 $1,907/mo. 0.94% Springville PUD $35.06 $3,900 $2,023/mo. 1.73% Strathmore PUD $14.70 $500 $2,096/mo. 0.70% Terra Bella SMD $21.00 $500 $2,109/mo. 1.00% Woodville PUD $17.25 $700 $2,123/mo. 0.81% Average $18.23 $1,475 $2,098/mo. 0.87% 1) Source: Wastewater User Charge Survey Report FY 2004-05 (Cal EPA – SWRCB, May 2005) 2) Source: Census 2000 As indicated in Table 5-3, the Earlimart PUD charges among the lowest monthly rates for sewer service compared to other sewer service providers throughout the County. The cost of sanitary sewer service within Earlimart equates to approximately 0.42% of the average household income within the community. The Earlimart PUD sanitary sewer connection fee is also below average compared to other service providers throughout the County. The District should periodically review its monthly user fees and connection fees to ensure that quality service will continually be provided to existing and future residents. The Earlimart PUD rates are currently among the lowest compared to surrounding service providers, which is indicative of the District’s ability to provide efficient and affordable utility services to residents in the community. The District has not increased its flat rate fees since 1995. The District indicated that that the fees will be re- evaluated in the near future as a result of the need to expand the wastewater capacity and upgrade the wastewater treatment plant. The District’s budget is structured to segregate costs associated with the construction of infrastructure to accommodate new development. Fees paid by developers are placed into a restricted reserve account, funds which are ultimately used by the District to construct capital capacity improvements to the Earlimart Public Utility District MSR Page 5-19 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 District’s water and sewer systems. User fees are used for the operations of the District and the operation and maintenance of the District’s infrastructure. 5.5.2 Written Determinations 1. The Earlimart PUD charges monthly user fees and new connection fees for water and sewer. The fiscal year 2004-05 budget estimates revenues of $435,000 to be generated from current water and sewer user fees. 2. The Earlimart PUD rates are currently among the lowest compared to other service providers throughout the County, which is indicative of the District’s ability to provide efficient and affordable utility services to residents in the community. The District has not increased its flat rate fees since 1995. The District indicated that that the fees will be re-evaluated in the near future as a result of the need to expand the wastewater capacity and upgrade the wastewater treatment plant. 3. The District’s budget is structured to segregate costs associated with the construction of infrastructure to accommodate new development. Fees paid by developers are placed into a restricted reserve account, funds which are ultimately used by the District to construct capital capacity improvements to the District’s water and sewer systems. User fees are used for the operations of the District and the operation and maintenance of the District’s infrastructure. Earlimart Public Utility District MSR Page 5-20 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.6 OPPORTUNITIES FOR SHARED FACILITIES The purpose of this section is to evaluate opportunities for a jurisdiction to share facilities and resources, thereby increasing efficiency. 5.6.1 Shared Facilities Since the location of the Earlimart District Boundary is immediately adjacent to existing rural lands, the opportunity for sharing infrastructure does not readily exist. 5.6.2 Written Determinations 1. Since the location of the Earlimart District Boundary is immediately adjacent to existing rural lands, the opportunity for sharing infrastructure does not readily exist. Earlimart Public Utility District MSR Page 5-21 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.7 GOVERNMENT STRUCTURE OPTIONS The purpose of this section is to consider the advantages and disadvantages of various government structures to provide public services. 5.7.1 Development within SOI Areas One of the most critical elements of LAFCO’s responsibilities is in setting logical service boundaries for communities based on their capability to provide services to affected lands. There are no other service providers immediately adjacent to Earlimart’s SOI indicating that the potential for duplication of services is not present. For this reason, it is logical that the Earlimart PUD adequately plan for and assume water and sewer service within its SOI Boundary. There are no foreseeable conditions that would indicate that development within the District’s SOI would result in a change in government structure. Prior to development within its SOI area, the District should complete infrastructure planning - including master plans - to address the infrastructure needs of affected areas and funding mechanisms to meet those needs. The District and/or County could also require developers to prepare specific plans prior to approving development within the District’s SOI. The District will need to continually expand and improve its water and sewer infrastructure to accommodate development within its current District Boundary and SOI expansion areas. 5.7.2 Written Determinations 1. There are no other service providers immediately adjacent to Earlimart’s SOI indicating that the potential for duplication of services is not present. For this reason, it is logical that the Earlimart PUD adequately plan for and assume water and sewer service within its SOI Boundary. 2. There are no foreseeable conditions that would indicate that development within the District’s SOI would result in a change in government structure. 3. Prior to development within its SOI area the District should complete master planning to address the infrastructure needs of affected areas and funding mechanisms to meet those needs. The District and/or County could also require developers to prepare specific plans prior to approving development within the District’s SOI. 4. The District will need to continually expand and improve its water and sewer infrastructure to accommodate development within its current District Boundary and SOI areas. Earlimart Public Utility District MSR Page 5-22 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.8 EVALUATION OF MANAGEMENT EFFICIENCIES The purpose of this section is to consider the management structure of the jurisdiction. 5.8.1 Organizational Structure Based upon a review of information provided by the Earlimart PUD, it appears that the provisions of domestic water and sanitary sewer are managed in a cost effective, efficient manner, meeting the needs of the community and ratepayers. The Earlimart PUD has accounting and finance functions, current personnel regulations and resolutions. The Earlimart PUD undergoes annual audits in compliance with auditing standards. The Earlimart PUD is governed by a three-member Board of Directors elected at large from within its boundaries. The Board is responsible for setting policy and general administrative procedures. The District currently operates with a full time staff that includes a District Manager, an assistant, and two maintenance technicians. The staff is readily available to respond to the needs of customers. The District contracts out for other service’s including engineering, legal counsel, accounting, and other consulting services. Based upon the District’s 2004-05 budget approximately $90,070 was appropriated for contingencies. Contingency funds can be used for emergency improvements and/or unforeseen replacement or rehabilitation costs. 5.8.2 Written Determinations 1. Based upon information made available, it appears that the provisions of domestic water and sanitary sewer are managed in a cost effective, efficient manner that meets the needs of the community and ratepayers. 2. The Earlimart PUD is governed by a three member Board of Directors elected at large from within its boundaries. The Board is responsible for setting policy and general administrative procedures. 3. The District currently operates with a full time staff including a District Manager, an assistant, and two maintenance technicians. The staff is readily available to respond to the needs of customers. 4. The District contracts out for other services, including engineering, legal counsel, accounting, and other consulting services. 5. It is recommended that the District be available to respond to emergency situations during non- business hours as well. Earlimart Public Utility District MSR Page 5-23 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01 5.9 LOCAL ACCOUNTABILITY AND GOVERNANCE The purpose of this section is to evaluate the accessibility and levels of public participation associated with the Earlimart PUD’s decision-making processes. 5.9.1 Public Access and Information Methods LAFCO may consider the agency’s record of local accountability in its management of community affairs as a measure against the ability to provide adequate services to the SOI and annexation areas. The Earlimart PUD has a five member Board of Directors that is elected by voters residing within the District’s Boundary. Regularly scheduled Board meetings, which are open to the public, are held on the 10th of each month at 3:00 p.m. at the District office located at 168 North Front Road in Earlimart. Agendas for Board meetings are posted and notices provided consistent with public meeting requirements (i.e., the Brown Act) including posting on-site. The District adopts budgets and rate changes at hearings where the public is notified and invited. The District should work with the Tulare County Resource Management Agency (RMA) and/or Tulare County LAFCO to have information regarding District affairs posted on the Tulare County RMA and/or LAFCO website. The District could provide information such as meeting times and locations, budgets, rates, ordinances, agendas, completed/upcoming projects, and other District affairs to Tulare County for posting on the County’s (RMA and/or LAFCO) website. It would make sense to post information regarding District affairs on County websites, since Earlimart is an unincorporated community within Tulare County, and there is a mutual interest in the community. The internet is a relatively low-cost yet powerful method of involving the general public/customers/ratepayers in District affairs. Greater dissemination of information can lead to greater interest in attending Board meetings and participating in elections. It also allows the public, some of whom are not physically able to attend Board meetings, to follow District activities remotely from their home or business. 5.9.2 Written Determinations 1. The District complies with the Brown Act open meeting law by holding regularly scheduled meetings in which the public is invited. Regularly scheduled meetings are held on the 10th of each month at 3:00 p.m. at the District office. Agendas for Board meetings are posted on-site at the District office. 2. The District adopts budgets and rate changes at hearings where the public is notified and invited. 3. The District should work with the Tulare County Resource Management Agency (RMA) and/or Tulare County LAFCO to have information regarding District affairs posted on the Tulare County RMA and/or LAFCO website. The District could provide information such as meeting times and locations, budgets, rates, ordinances, agendas, completed/upcoming projects, and other District affairs to Tulare County for posting on the County’s (RMA and/or LAFCO) website. Earlimart Public Utility District MSR Page 5-24 Tulare County LAFCO MSR G1_5 Earlimart Jan06.DOC/55-7301-01