MSR G2 4 Orosi Apr06

CHAPTER 4 – OROSI PUD MUNICIPAL SERVICE REVIEW EXECUTIVE SUMMARY This section provides an overview of the written determinations of the Orosi Public Utility District 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 Orosi PUD MSR identifies the following written determinations: Written Determinations 1) Growth and Population 1. Between 1990 and 2000, Orosi experienced an average annual population growth rate of approximately 2.9% compared to 0.6% for the unincorporated areas of Tulare County. 2. Assuming no development constraints, it can be expected that Orosi will continue to grow at an average annual rate between 2% and 3%, indicating the community would reach a year 2025 population between 12,000 and 15,300 residents. 3. District staff has indicated that they have been forced to reject six applications for annexation over the past three years due to inadequate sewer capacity. It was further indicated that five of the applications were immediately adjacent to the current District Boundary. 4. Consistent with the Urban Boundaries element of the Tulare County General Plan, the Cutler- Orosi UDB is, with minor exceptions, consistent with the external SOI for Cutler and Orosi. 2) Infrastructure Needs and Deficiencies Domestic Water 1. The Orosi PUD’s water supply is derived from four existing deep underground wells that have a total maximum production efficiency of approximately 2,930 GPM, or 4.22 MGD. The District also has a water storage tank with a capacity of approximately 750,000 gallons. 2. A test well has been drilled, has proven successful, and the District has awarded a contract for the drilling of a new well (Well #10). The District also indicated a need to replace older asbestos cement distribution piping with larger diameter ductile iron piping, and that improvements will be implemented on a phased basis and dependent upon available funding. 3. The Orosi PUD water system supports 1,788 total connections to their water system including 1,639 residential connections, 132 commercial connections, 3 agricultural connections, and 14 connections which are inactive. Orosi Public Utility District MSR Page 4-1 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4. Water consumption data indicated that there was an immediate decrease (between 21% and 23%) in domestic water usage as a result of metering, which began January 2005. Since then, the District has billed customers based upon a metered usage. The District’s implementation of water meters is indicative of the District’s desire to promote water conservation, and continue to provide effective water service to its residents. 5. District staff has indicated that they are working with Alta Irrigation District officials to study the feasibility of constructing a regional water treatment facility that would use water from the Kings River by exchange out of the Friant-Kern Canal. The regional facility would potentially provide domestic water to the City of Dinuba, Cutler, Orosi, and other unincorporated communities in the region. A feasibility study would be a three to five year process, and project implementation could be ten to fifteen years out. 6. Assuming 1,800 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Orosi PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,400 GPM (1,500 GPM fire flow, and 1,900 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 combined source flow of approximately 8,660 GPM not including the well that pumps into the storage tank (approximately 6,250 GPM could be delivered for two hours from the 750,000 gallon storage tank, assuming the tank is full). The District’s water system would need to be tested at actual system pressure to determine the actual amount of available capacity for domestic and fire flow. 7. 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 water supply sources could support an additional 2,000 equivalent dwelling units. Special circumstances, i.e. distribution system pressure constraints, could significantly affect the available capacity, and a complete assessment should be completed by the District Engineer prior to the approval of additional connections. Sanitary Sewer 1. According to District staff, the District’s sanitary sewer collection system is very old and pipe leaks and breaks cause significant problems including groundwater inflow/infiltration and cross contamination with groundwater. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. 2. Treatment and disposal of the collected effluent is provided at the Cutler-Orosi WWTF, jointly owned and operated by the Cutler PUD and Orosi PUD. The Cutler-Orosi WWTF serves the communities of Cutler, Orosi, East Orosi, Yettem, Seville, and Sultana. 3. The Cutler-Orosi WWTF operates under the provisions of Waste Discharge Requirements (WDR) Order No. 97-106, issued by the California RWQCB. According to JPWA staff, the WWTF has been certified by a registered civil engineer, and has a permitted capacity of 2.0 MGD. 4. As of March 2006, the Cutler-Orosi WWTF is operating under a Cease and Desist Order according to the RWQCB file. The RWQCB indicated that the Cutler-Orsoi JPWA has Orosi Public Utility District MSR Page 4-2 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 complied with the requirements of the Cease and Desist Order, and an order to rescind the Cease and Desist Order is expected to be completed in April 2006. 5. The average dry weather flow at the WWTF is approximately 1.40 MGD, with a historical high flow of 1.89 MGD. Flow at the WWTF is greater during winter months than in summer months due to inflow/infiltration of storm water into the collection system during winter months, and ex-filtration during dry summer months. The District will be able to more accurately predict the remaining capacity at the WWTF once repairs are made to leaking pipes throughout the collection system. 6. The Orosi PUD is currently allocated 2,162 equivalent dwelling units of capacity at the WWTF. The Orosi PUD is currently under a building moratorium, and has a waiting list for additional sewer connections. 7. The Cutler PUD and Orosi PUD are working with the Tulare County Redevelopment Agency to secure funding that will be used to correct deficiencies that would increase the capacity of the WWTF. Proposed improvements will modernize the facility and add capacity to bring the serviceable operational limits to 2.4 MGD. 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’s operating budgets (excluding reserve funds) for fiscal year 2005-06 totaled $1,619,142 for sanitary sewer and $2,039,270 for water service. The District’s budget included contingency funds of $17,500 and $57,000 for sanitary sewer and domestic water service, respectively. 3. A review of the District’s budget indicates that the District is in stable financial condition. The District’s annual revenues cover the annual operating expenses of the District including reserve allocations and contingency appropriations. 4. It is likely that development within the District’s SOI will rely on infrastructure available from the District. To increase its preparedness when such development is proposed, it is recommended that the District prepare and implement water and sewer system master plans. 4) Cost Avoidance Opportunities 1. The District avoids excessive overhead costs by operating with part-time and full-time staff, which provides adequate levels of service to the small community. The District also avoids unnecessary costs by contracting out professional services including engineering, legal services, and other consulting services, and using these services on an as needed basis. 2. 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 as a way of avoiding unnecessary costs. 3. Master planning could help the District avoid unnecessary costs by allowing the District sufficient time to set aside funding needed for future capacity improvements that would allow for development within the community. Orosi Public Utility District MSR Page 4-3 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4. The District could also avoid unnecessary costs associated with the maintenance of capital infrastructure by promoting development in infill areas, and areas where infrastructure is already in place. 5) Opportunities for Rate Restructuring 1. The Orosi PUD charges monthly user fees and new connection fees (capacity rights fees) for water and sewer. The District’s fiscal year 2005-06 budget estimates revenues of $380,000 and $520,000 to be generated from water and sewer customer sales, respectively. 2. The monthly user fees for domestic water service are below average, while the connection fees (capacity rights fees) are slightly above average compared to other domestic water service providers in Tulare County. Water consumption data shows that there was an immediate decrease in water usage as a result of metering. 3. The monthly sewer rates and capacity rights fees charged by the District are above average compared to surrounding sewer service providers in Tulare County. The high sanitary sewer fees are likely attributable to the cost of improving the Cutler-Orosi WWTF and repairing the collection system. 4. The District should periodically review its monthly user fees and capacity rights fees to ensure that quality service will continually be provided to existing and future residents. Any rate increases should be substantiated and adopted through a public hearing process. 5. 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, including capital replacement costs. 6) Opportunities for Shared Facilities 1. The Orosi PUD and Cutler PUD take advantage of shared infrastructure by operating a single WWTF through a JPWA comprised of three Board members from each District. 2. If the communities of Cutler and Orosi eventually become an incorporated City, the Districts will need to consider combining the existing infrastructure for domestic water service and sanitary sewer service. The District’s will also need to consider adopting a uniform rate structure for all services of the City, should the Districts ultimately incorporate as a single City entity. 7) Government Structure Options 1. If the communities of Cutler and Orosi become an incorporated City, it is likely that a single SOI which incorporates the areas within each District’s current SOI would be established as a starting point. Incorporation would ultimately result in the dissolution of the Orosi PUD, as well as the Cutler PUD. Any changes in organization should be completed in accordance with LAFCO policies and procedures. Orosi Public Utility District MSR Page 4-4 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 2. 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. 3. The District should continually expand and improve its domestic water and sanitary sewer infrastructure to accommodate development within its current District Boundary and SOI areas zoned for development with developer assistance. 8) Evaluation of Management Efficiencies 1. Based upon information made available, it appears that the provision of domestic water service and sanitary sewer collection is managed in an efficient manner and meets the needs of the community and ratepayers. 2. The age of the District’s sewer infrastructure is becoming an issue that the District needs to address in the short-term. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. 3. The Orosi PUD is governed by a five member Board of Directors elected at large from within its boundaries and is responsible for setting policy and general administrative procedures. 4. The District currently operates with a part-time and full-time staff and contracts out for other services, including engineering, legal counsel, accounting, and other consulting services. 5. The District’s answering message provides contact information in case of emergencies as well as the District’s hours of operation. 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 second Tuesday of each month at 7:30 p.m. 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. Orosi Public Utility District MSR Page 4-5 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.0 OROSI PUBLIC UTILITY DISTRICT 4.0.1 Background The requirement for LAFCO to conduct reviews of local municipal services was established with the passage of AB 2838 known as 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. MSRs provide LAFCO 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 Tulare County LAFCO adopted an MSR exemption policy that 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 an MSR study. The Orosi Public Utility District (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 Orosi, an unincorporated community in Tulare County, is located in the northern portion of the County, approximately five miles east of Dinuba and ten miles north of Visalia. The Orosi PUD, which was formed in December 1922, has a primary function of providing sanitary sewer and domestic water service for the community. Sanitary sewer and domestic water service are the primary services provided by the Orosi PUD that are subject to an MSR. Orosi is located north of and adjacent to the community of Cutler. Orosi is an agriculturally oriented service community surrounded on the north, west and east by lands in agricultural production, vacant lands, and scattered residential homes. Cities and communities surrounding Orosi include Visalia to the south; Dinuba to the west; the community of Cutler to the south; and the community of East Orosi to the east. The Tulare County/Fresno County Line is located approximately 2.3 miles northwest of Orosi. The current District Boundary and the currently adopted SOI for Orosi are illustrated on Figure 4-1. Figure 4- 1 also shows the Cutler-Orosi Urban Development Boundary and the Boundary of the Cutler-Orosi Joint Powers Authority wastewater treatment facility. These boundaries are further explained in subsequent sections of this report. Orosi Public Utility District MSR Page 4-6 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 FIGURE 4-1 – OROSI PUD BOUNDARY, SOI, AND URBAN DEVELOPMENT BOUNDARY (UDB) Source: Tulare County GIS Database Orosi Public Utility District MSR Page 4-7 Tulare County LAFCO MSR G2_4 Orosi Apr06.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. Orosi Public Utility District MSR Page 4-8 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.1 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 Orosi. 4.1.1 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). In 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. Census 2000 data indicates that Orosi had a population of 7,318 as of January 2000. Census 1990 data indicates that Orosi had a population of 5,486 corresponding to an average annual growth rate between 1990 and 2000 of approximately 2.9%. 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%. Assuming no development constraints, it is likely the Orosi community will continue to grow at an average annual rate between 2% and 3%. Using an average annual growth rate between 2% and 3%, the Orosi community would reach a year 2025 population between 12,000 and 15,300 residents. 4.1.2 Annexation Applications District staff has indicated that they have been forced to reject six applications for annexation over the past three years due to inadequate sewer capacity. It was further indicated that five of the applications were immediately adjacent to the current District Boundary. The District indicated that proposed development within their SOI can opt to provide own sewer and water service due to a lack of capacity available from the District. 4.1.3 Planning Boundaries In addition to a SOI, which is defined by LAFCO as the “…physical boundary and service area that a local government agency is expected to serve…”an urban development boundary (UDB) has been established and designates the Cutler-Orosi urban area. Figure 4-1 shows the District Boundary and SOI in comparison to the District’s UDB. The UDB is, for the most part, coterminous with the external SOI boundary of each District. The Tulare County General Plan contains an Urban Boundaries Element which establishes goals for designating realistic planning areas around cities and unincorporated communities which could be used to help determine boundaries for community service districts and County service areas, in areas where differing levels of service are required, and within which corporate annexations may take place. The following are excerpts from the County of Tulare General Plan Policy Summary Section 1UB.C.1 – Unincorporated Communities Policies. “Urban Development Boundaries are established around the following unincorporated communities in the County to serve as official urban planning areas for these communities: Cutler-Orosi, Ducor, Earlimart, East Orosi, Goshen, Ivanhoe, Lemon Cove, London, Pixley, Plainview, Poplar-Cotton Center, Richgrove, Strathmore, Terra Bella, Tipton, Traver, Woodville, Alpaugh, and Springville.” Orosi Public Utility District MSR Page 4-9 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 “A land use plan is to be developed for each community with an Urban Development Boundary, specifying desired densities and land use categories, with particular attention to defining suitable areas for the full range of urban development and rural residential development. Such plans shall include the entire area within the Boundary and shall recognize the short and long term ability of each community to provide necessary urban services within its Urban Development Boundary.” Furthermore, the County of Tulare General Plan Policy Summary Sections 1UB.F.1. and 1UB.F.2. set forth policies with regard to “Boundary Consistency”, and “Review and Revision of Boundaries.” Excerpts from these sections of the County General Plan Policy Summary relating to special districts are reiterated below. “In areas where special districts provide rural as well as urban services, LAFCo should distinguish between “urban” and “rural” service areas for the purpose of establishing Spheres of Influence for such districts. If an unincorporated community is served by a special district, the Urban Development Boundary should be consistent with the district’s “urban” Sphere of Influence.” “County census boundaries should be as consistent as possible with Urban Development Boundaries.” “Urban Area Boundaries and Urban Development Boundaries shall be reviewed at least once every five years to determine if boundary changes are justified, or if additional boundaries are needed for communities not included herein. However, a review may be conducted at any time on request of the affected city or agency.” As indicated on Figure 4-1, the Cutler-Orosi UDB is, with minor exceptions, consistent with the external SOI for Cutler and Orosi. The County census boundary does not cover the entire area incorporated within the Orosi UDB area. Generally, the census boundary covers the urbanized area of the community, but does not cover areas in the northwest or northeast portions of the Orosi UDB area. 4.1.4 Written Determinations 1. Between 1990 and 2000, Orosi experienced an average annual population growth rate of approximately 2.9% compared to 0.6% for the unincorporated areas of Tulare County. 2. Assuming no development constraints, it can be expected that Orosi will continue to grow at an average annual rate between 2% and 3%, indicating the community would reach a year 2025 population between 12,000 and 15,300 residents. 3. District staff has indicated that they have been forced to reject six applications for annexation over the past three years due to inadequate sewer capacity. It was further indicated that five of the applications were immediately adjacent to the current District Boundary. 4. Consistent with the Urban Boundaries element of the Tulare County General Plan, the Cutler- Orosi UDB is, with minor exceptions, consistent with the external SOI for Cutler and Orosi. Orosi Public Utility District MSR Page 4-10 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.2 INFRASTRUCTURE NEEDS AND DEFICIENCIES The purpose of this section is to evaluate the infrastructure needs and deficiencies of the Orosi PUD in terms of availability of resources, capacity to deliver services, condition of facilities, service quality, and levels of service. 4.2.1 Domestic Water The Orosi PUD is responsible for providing domestic water service within the District’s Boundary. Orosi’s water supply is derived from four deep underground wells located at various sites throughout the community. Three of the wells discharge into 10,000 gallon hydro-pneumatic pressure tanks, and one well discharges into a 750,000 gallon storage tank with booster pumps that discharge into a hydro- pneumatic pressure tank. The water from each supply source is chlorinated and then distributed throughout the system. Currently, 40% of the District’s water distribution system consists of asbestos- concrete pipe ranging in size from 2” to 6” in diameter. Ultimately, the District has indicated the need to replace the existing AC lines with 8” ductile iron piping. District staff also indicated the production efficiency of the wells ranges between 520 and 850 gallons per minute (GPM) and that the four wells have a total maximum production efficiency of approximately 2,930 GPM, or 4.22 MGD. Two additional existing wells are currently inactive due to nitrate contamination. The District has awarded a contract for the drilling of a new well (Well #10). The District explored the possibility of mixing the water supplies from wells (via elevated storage, or mixing tank with booster pumps), before entering the distribution system in order to use the two wells that are currently inactive due to high nitrate levels. The blending tank project was subsequently determined to be infeasible due to operational requirements. The District indicated that the community water system (as of October 2004) supports 1,788 total connections including 1,639 residential connections, 132 commercial connections, 3 agricultural connections, and 14 connections which are inactive. The District’s water system also supports 164 fire hydrants located throughout the community. The Orosi PUD water system has been fully metered as of January 1, 2005. Since then the District has billed customers based upon a metered usage. Water consumption data provided by District staff indicated that there was an immediate decrease in domestic water usage as a result of metering. Prior to water metering, the District experienced a peak month flow of 62.742 MG in July 2004 and a max day flow of 2.172 MGD. After metering was implemented by the District, a peak flow rate of 48.102 MG in July 2005 was observed with a max day flow of 1.706 MGD. This equates to a reduction of 23.3% in the peak month flow and a 21.5% reduction in the max day flow. The District’s implementation of water meters is indicative of the District’s desire to promote water conservation, and continue to provide effective water service to its residents. District staff has indicated that they are working with Alta Irrigation District officials to study the feasibility of constructing a regional water treatment facility that would use water from the Kings River by exchange out of the Friant-Kern Canal. The regional facility would provide domestic water to the communities of Cutler and Orosi, and potentially the City of Dinuba and other unincorporated communities in the region. District staff indicated that a feasibility study would be a three to five year process, and that implementation of the project could be ten to fifteen years out. 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. Orosi Public Utility District MSR Page 4-11 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 • 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 1,800 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Orosi PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,400 GPM (1,500 GPM fire flow, and 1,900 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 combined source flow of approximately 8,660 GPM not including the well that pumps into the storage tank (approximately 6,250 GPM could be delivered for two hours from the 750,000 gallon storage tank, assuming the tank is full). This indicates that the District’s water system currently meets the requirements of the Tulare County Improvement Standards. 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 system, including but not limited to, water quality, low pressures, required storage, age 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) Orosi Public Utility District MSR Page 4-12 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 Using an N value of 1,788, a C factor of 7.5 (due to the especially high dwelling unit occupancy rate in the community), and an F factor of 0.30, the estimated total supply source required is calculated to be 3,218 GPM. With a total well supply source available of 8,660 GPM (for a period of two hours, assuming the storage tank is full), it is estimated that the District’s water supply, and storage facilities could support an additional 2,000 equivalent dwelling units. It should be noted that there could be special circumstances, i.e. distribution system pressure constraints, that could significantly affect this result, and a complete assessment should be completed by the District Engineer prior to the approval of additional connections. The water system would need to be tested at actual system pressure to determine the actual amount of available capacity for domestic and fire flow. 4.2.2 Sanitary Sewer The Orosi PUD is also responsible for providing sanitary sewer collection to residents within its Boundary. According to District staff, the sewer collection system is very old and pipe leaks and breaks cause significant problems including groundwater inflow/infiltration and cross contamination with groundwater. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. Treatment and disposal of the collected effluent is provided by the Cutler-Orosi Joint Powers Wastewater Authority (JPWA). In March 1980, the Orosi PUD entered into the Joint Wastewater Treatment and Disposal Facilities Agreement with the Cutler PUD, forming the Cutler-Orosi JPWA for the purpose of operating a wastewater treatment and disposal facility (WWTF). Under the terms of the agreement, the Orosi PUD owns 50% of the property and 60% of the plant and equipment used by the Authority. Each District is charged for its share of the costs to the Authority based upon its pro-rata share of gallonage flows into the facility. The governing board of the JPWA is made of three appointed members from the Orosi PUD Board of Directors and three appointed members from the Cutler PUD Board of Directors. The JPWA Board of Directors controls its own operations, including selection of management and approval of operating budgets. The separate boards of the Orosi PUD and Cutler PUD must approve capital expenditures. The construction of the WWTF, completed in 1983, was funded by 75% from a cost grant from the Environmental Protection Agency, 12.5% from a cost grant from the State Water Resources Control Board, and 12.5% from proceeds of revenue bonds sales. The Joint Wastewater Treatment and Disposal Facility Amended Agreement between the two Districts states that all assets accumulated by the JPWA (other than cash, accounts receivable, prepaid expenses, and motor vehicles) shall be treated as owned by the Districts and in accordance with their participation in the JPWA. In addition, each District’s allocated share of JPWA fixed assets is recorded and depreciated as part of property, plant and equipment, and its share of cash and all other assets are recorded as investment in the Cutler-Orosi JPWA. The Cutler-Orosi WWTF serves the communities of Cutler, Orosi, East Orosi, Yettem, Seville, and Sultana. The WWTF operates under the provisions of Waste Discharge Requirements (WDR) Order No. 97-106 issued by the California Regional Water Quality Control Board (RWQCB), Central Valley Region. Based upon discussions with the RWQCB, the Cutler-Orosi WWTF is also operating under a Cease and Desist (C&D) Order (No. 97-107), which is still in effect as of March 2006 according to the RWQCB file. According to the RWQCB, the Cutler-Orosi JPWA has complied with the requirements of the Cease and Desist Order, and the Board is in the process of preparing an order to rescind the Cease and Desist Order, which is expected to be completed in April 2006. According to JPWA staff, the plant has been certified by a registered civil engineer, and has a permitted capacity of 2.0 MGD. According to the District Engineer, the historical high flow recorded at the WWTF was 1.89 MGD, and the average dry weather flow is approximately 1.40 MGD. The District Engineer Orosi Public Utility District MSR Page 4-13 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 also noted that during dry months the sewer collection system experiences ex-filtration and during winter months the collection system experiences inflow/infiltration of storm water. The District will be able to more accurately predict the remaining capacity at the WWTF once repairs are made to leaking pipes throughout the collection system. The Orosi PUD entered into an agreement with the WWTF and is allowed to transport effluent to the treatment facility not to exceed 2,162 equivalent dwelling units. The Orosi PUD is currently under a building moratorium, and has a waiting list for additional sewer connections. According to District staff, Tulare County Redevelopment Agency (TCRA) is working with the Cutler PUD and Orosi PUD to correct deficiencies that would increase the capacity of the treatment facility. The TCRA, on behalf of the Cutler-Orosi JPWA has submitted an application for Federal Assistance to construct improvements and additions at the Cutler-Orosi WWTF. The proposed project funding amounts to $4,657,900, with a start date of February 2006, and an ending date of October 2009. The project represents the combined efforts by the Cutler PUD and the Orosi PUD to improve and upgrade the jointly operated WWTF, which involves: • Improvements and additions to the plant headworks • Improvements to the secondary clarifier • Construction of a new secondary clarifier • Construction of sludge drying beds • Electrical improvements and installation of UV disinfection • Effluent pump station capacity increase • Land preparation and irrigation system • Construction safety, mobilization and miscellaneous work Several issues have caused the WWTF to reach its serviceable limits including age of system components, leaks in the collection system, and community growth. Until improvements at the WWTF are completed, both the Cutler PUD and Orosi PUD have restricted development within each community. The improvements will modernize the facility and add capacity to bring the serviceable operational limits to 2.4 MGD. Improving the wastewater treatment capabilities of the District will allow the community to expand its affordable housing stock and promote economic development opportunities. 4.2.3 Written Determinations Domestic Water 1. The Orosi PUD’s water supply is derived from four existing deep underground wells that have a total maximum production efficiency of approximately 2,930 GPM, or 4.22 MGD. The District also has a water storage tank with a capacity of approximately 750,000 gallons. 2. A test well has been drilled, has proven successful, and the District has awarded a contract for the drilling of a new well (Well #10). The District also indicated a need to replace older asbestos cement distribution piping with larger diameter ductile iron piping, and that improvements will be implemented on a phased basis and dependent upon available funding. 3. The Orosi PUD water system supports 1,788 total connections to their water system including 1,639 residential connections, 132 commercial connections, 3 agricultural connections, and 14 connections which are inactive. Orosi Public Utility District MSR Page 4-14 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4. Water consumption data indicated that there was an immediate decrease (between 21% and 23%) in domestic water usage as a result of metering, which began January 2005. Since then, the District has billed customers based upon a metered usage. The District’s implementation of water meters is indicative of the District’s desire to promote water conservation, and continue to provide effective water service to its residents. 5. District staff has indicated that they are working with Alta Irrigation District officials to study the feasibility of constructing a regional water treatment facility that would use water from the Kings River by exchange out of the Friant-Kern Canal. The regional facility would potentially provide domestic water to the City of Dinuba, Cutler, Orosi, and other unincorporated communities in the region. A feasibility study would be a three to five year process, and project implementation could be ten to fifteen years out. 6. Assuming 1,800 equivalent dwelling units (EDUs), in order to meet Tulare County Improvement Standards the Orosi PUD water system would need to be capable of delivering a combined flow rate (from all source and storage facilities) of 3,400 GPM (1,500 GPM fire flow, and 1,900 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 combined source flow of approximately 8,660 GPM not including the well that pumps into the storage tank (approximately 6,250 GPM could be delivered for two hours from the 750,000 gallon storage tank, assuming the tank is full). The District’s water system would need to be tested at actual system pressure to determine the actual amount of available capacity for domestic and fire flow. 7. 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 water supply sources could support an additional 2,000 equivalent dwelling units. Special circumstances, i.e. distribution system pressure constraints, could significantly affect the available capacity, and a complete assessment should be completed by the District Engineer prior to the approval of additional connections. Sanitary Sewer 1. According to District staff, the District’s sanitary sewer collection system is very old and pipe leaks and breaks cause significant problems including groundwater inflow/infiltration and cross contamination with groundwater. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. 2. Treatment and disposal of the collected effluent is provided at the Cutler-Orosi WWTF, jointly owned and operated by the Cutler PUD and Orosi PUD. The Cutler-Orosi WWTF serves the communities of Cutler, Orosi, East Orosi, Yettem, Seville, and Sultana. 3. The Cutler-Orosi WWTF operates under the provisions of Waste Discharge Requirements (WDR) Order No. 97-106, issued by the California RWQCB. According to JPWA staff, the WWTF has been certified by a registered civil engineer, and has a permitted capacity of 2.0 MGD. 4. As of March 2006, the Cutler-Orosi WWTF is operating under a Cease and Desist Order according to the RWQCB file. The RWQCB indicated that the Cutler-Orsoi JPWA has Orosi Public Utility District MSR Page 4-15 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 complied with the requirements of the Cease and Desist Order, and an order to rescind the Cease and Desist Order is expected to be completed in April 2006. 5. The average dry weather flow at the WWTF is approximately 1.40 MGD, with a historical high flow of 1.89 MGD. Flow at the WWTF is greater during winter months than in summer months due to inflow/infiltration of storm water into the collection system during winter months, and ex-filtration during dry summer months. The District will be able to more accurately predict the remaining capacity at the WWTF once repairs are made to leaking pipes throughout the collection system. 6. The Orosi PUD is currently allocated 2,162 equivalent dwelling units of capacity at the WWTF. The Orosi PUD is currently under a building moratorium, and has a waiting list for additional sewer connections. 7. The Cutler PUD and Orosi PUD are working with the Tulare County Redevelopment Agency to secure funding that will be used to correct deficiencies that would increase the capacity of the WWTF. Proposed improvements will modernize the facility and add capacity to bring the serviceable operational limits to 2.4 MGD. Orosi Public Utility District MSR Page 4-16 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.3 FINANCING OPPORTUNITIES AND CONSTRAINTS The purpose of this section is to evaluate the jurisdictions capability to finance needed improvements and services. 4.3.1 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. The fiscal year 2005-06 budget for the Orosi PUD is organized into two separate funds: one for sanitary sewer and the other for domestic water. Based upon a review of the District’s fiscal year 2005-06 budget, the District is in sound financial condition. The District’s budget is well organized, thorough, and clearly articulates the District’s future financial performance plans. The District prepares a traditional line item budget for each fund (sewer and water) that is divided into the following categories. • Fund Balances • Revenues • Reserve Funds • Expenses o Salaries and Employee Benefits o Services and Supplies o Other o Fixed Assets o Contingencies 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. The District’s sanitary sewer budget for fiscal year 2005-06 identifies a beginning cash balance of $4,263,079 and anticipated revenues of $529,388 to be generated primarily from customer sales. Of the total resources available, $3,173,325 is in restricted reserves leaving $1,619,142 in total available funds. Restricted reserves are established by depreciation of equipment and facilities owned and operated by the District. Restricted reserves are not necessarily used annually, but instead they are used when specific equipment has depreciated to the point of needing replacement. The specific items for which restricted reserves are allocated are identified below. • 1981 Revenue Bond • Plant Replacement • Connection Fees • M&O Reserve • Self Insurance • Sewer Line Depreciation • Line Cleaning Machine • Truck Replacement • Board Decisions Reserve Orosi Public Utility District MSR Page 4-17 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 After accounting for restricted reserves from the District’s budget, the remaining resources of $1,619,142 covers salaries and employee benefits totaling $102,819; services and supplies totaling $335,100; other charges totaling $20,752; fixed assets totaling $1,142,971; and a contingency appropriation of $17,500. The District typically requires developers to pay the cost of installing the local piping infrastructure to serve proposed developments. Reviewing the District’s budget for the current and previous fiscal years indicates that the District is financially stable with regard to its sewer fund. The District’s annual revenues cover the annual operating expenses of the District including reserve allocations and contingency appropriations. It is likely that development within the SOI will rely on infrastructure available from the District. For this reason the District should be prepared to accommodate such growth. The Orosi PUD should continue to work closely with the Cutler PUD to implement improvements that would increase the capacity of the WWTF, which would increase the District’s ability to serve development within its SOI. The preparation and implementation of a sewer system master plan would also increase the District’s preparedness when development within its SOI is proposed. A master plan would also identify existing deficiencies and make recommendations to correct such deficiencies. The District could potentially obtain funding assistance to prepare a master plan by applying for available State and/or Federal grants. The District’s water budget for fiscal year 2005-06 identifies a beginning cash balance of $2,770,386 and anticipated revenues of $398,000 ($380,000 generated from customer sales, leak detection grant proceeds in the amount of $12,000, and other revenues totaling $6,000). Of the total resources available $1,127,116 is in restricted reserves leaving $2,041,270 in total available funds. Restricted reserves are established by depreciation of equipment and facilities owned and operated by the District. Restricted reserves are not necessarily used annually, but instead they are used when specific equipment has depreciated to the point of needing replacement. The specific items for which restricted reserves are allocated are identified below. • Self Insurance • Water Lines • Customer Deposit • Truck Replacement • Computer • Wells and Pumps • Connection Fees After accounting for restricted reserves from the District’s budget, the remaining resources of $2,039,270 covers salaries and employee benefits totaling $295,640; services and supplies totaling $242,800; other charges totaling $100; fixed assets totaling $1,443,830; and a contingency appropriation of $57,000. Reviewing the District’s budget for the current and previous fiscal years indicates that the District is financially stable with regard to its water fund. It is likely that development within the SOI will rely on infrastructure available from the District. For this reason the District should be prepared to accommodate such growth. It is recommended that the District prepare and implement a water system master plan, which would increase its preparedness when development within its SOI is proposed. 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 Public Utility District is governed provide the structure for funding activities. Key revenue sources for the Orosi PUD include monthly sewer and water fees, connection (capacity rights) fees, interest on Orosi Public Utility District MSR Page 4-18 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 reserves, and pass through monies. One-time revenues, that are pass-through funds, account for the increases and decreases in revenue from year to year. On the expenditures side, the District budgets for the services paid for by residents and provides for capital expenses using restricted reserve accounts. 4.3.2 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’s operating budgets (excluding reserve funds) for fiscal year 2005-06 totaled $1,619,142 for sanitary sewer and $2,039,270 for water service. The District’s budget included contingency funds of $17,500 and $57,000 for sanitary sewer and domestic water service, respectively. 3. A review of the District’s budget indicates that the District is in stable financial condition. The District’s annual revenues cover the annual operating expenses of the District including reserve allocations and contingency appropriations. 4. It is likely that development within the District’s SOI will rely on infrastructure available from the District. To increase its preparedness when such development is proposed, it is recommended that the District prepare and implement water and sewer system master plans. Orosi Public Utility District MSR Page 4-19 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.4 COST AVOIDANCE OPPORTUNITIES The purpose of this section is to identify practices or opportunities that may help to eliminate unnecessary costs. 4.4.1 Fiscal Structure The District’s 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 avoids excessive overhead costs by operating with a part-time and full-time administration, which provides adequate levels of service to the community. The District also avoids unnecessary costs by contracting out professional services including engineering, legal services, and other consulting services. Generally, the District requires development projects to pay for their own infrastructure (water lines, sewer lines, fire protection, and lighting) to serve their projects. The District requires development projects to pay capacity rights fees currently set at $2,400 and $1,745 per equivalent dwelling unit (EDU) for water and sewer service connections, respectively. Capacity rights fees are used by the District to construct infrastructure capacity improvements (new wells, WWTF improvements, etc). 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 as a way of avoiding unnecessary costs. The preparation of water and sewer system master plans could help the District avoid unnecessary costs associated with the construction of emergency system improvements to meet demands. Master plans identify infrastructure improvements that will be needed in the future, including an improvement timeline that would allow the District adequate time to set aside and/or obtain funding for those future improvements before the absence of such improvements begins to delay or halt proposed development. Master plans typically identify funding sources for their implementation. If the SOI were expanded in the future, the District would assume fiscal responsibilities to construct or maintain the sewer and domestic water infrastructure associated with the SOI and any territories that were annexed. LAFCO should consider the relative financial and operational 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. 4.4.2 Written Determinations 1. The District avoids excessive overhead costs by operating with part-time and full-time staff, which provides adequate levels of service to the small community. The District also avoids unnecessary costs by contracting out professional services including engineering, legal services, and other consulting services, and using these services on an as needed basis. Orosi Public Utility District MSR Page 4-20 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 2. 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 as a way of avoiding unnecessary costs. 3. Master planning could help the District avoid unnecessary costs by allowing the District sufficient time to set aside funding needed for future capacity improvements that would allow for development within the community. 4. The District could also avoid unnecessary costs associated with the maintenance of capital infrastructure by promoting development in infill areas, and areas where infrastructure is already in place. Orosi Public Utility District MSR Page 4-21 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.5 OPPORTUNITIES FOR RATE RESTRUCTURING The purpose of this section is to identify opportunities to positively impact rates without decreasing service levels. 4.5.1 Fee Structure The Orosi PUD installed and started billing under a metered water system in January 2005. Water consumption data shows that there was an immediate decrease in water usage as a result of metering; therefore it also serves as a water conservation measure. The Orosi PUD charges a monthly flat rate for sewer service. The District’s fiscal year 2005-06 budget estimates revenues of $380,000 and $520,000 to be generated from water and sewer customer sales, respectively. Tables 4-1 and 4-2 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 within 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 4-1 OROSI PUD COMPARISON OF WATER RATES Average Household Service Provider Sample Monthly Bill Connection Fee Income Rate/Income Ratio 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 Orosi Public Utility District MSR Page 4-22 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 As indicated in Table 4-1, the Orosi PUD charges monthly rates that are below average compared to surrounding domestic water service providers. The cost of domestic water service within Orosi equates to approximately 0.75% of the average household income within the community. The Orosi PUD water connection fee (capacity rights fee) is above average compared to other domestic water service providers throughout the County. TABLE 4-2 OROSI PUD COMPARISON OF SEWER RATES Average Monthly Sewer Connection Household Service Provider User Fee (1 EDU)1 Fee1 Income2 Rate/Income Ratio 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 4-2, the Orosi PUD charges monthly rates that are above average compared to surrounding sanitary sewer service providers. The cost of sanitary sewer service within Orosi equates to approximately 0.91% of the average household income within the community. The Orosi PUD sanitary sewer connection fee (capacity rights fee) is also above average compared to other sanitary sewer service providers throughout the County. The high sanitary sewer fees are likely attributable to the cost of improving the Cutler-Orosi WWTF and repairing the collection system. The District should periodically review its monthly user fees, and capacity rights fees to ensure that quality service will continually be provided to existing and future residents. Often it is necessary to increase user fees and/or capacity rights fees to keep pace with cost of living increases and rising material and construction costs. Any rate increases should be substantiated and adopted through a public hearing process. 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 Orosi Public Utility District MSR Page 4-23 Tulare County LAFCO MSR G2_4 Orosi Apr06.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, including capital replacement costs. 4.5.2 Written Determinations 1. The Orosi PUD charges monthly user fees and new connection fees (capacity rights fees) for water and sewer. The District’s fiscal year 2005-06 budget estimates revenues of $380,000 and $520,000 to be generated from water and sewer customer sales, respectively. 2. The monthly user fees for domestic water service are below average, while the connection fees (capacity rights fees) are slightly above average compared to other domestic water service providers in Tulare County. Water consumption data shows that there was an immediate decrease in water usage as a result of metering. 3. The monthly sewer rates and capacity rights fees charged by the District are above average compared to surrounding sewer service providers in Tulare County. The high sanitary sewer fees are likely attributable to the cost of improving the Cutler-Orosi WWTF and repairing the collection system. 4. The District should periodically review its monthly user fees and capacity rights fees to ensure that quality service will continually be provided to existing and future residents. Any rate increases should be substantiated and adopted through a public hearing process. 5. 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, including capital replacement costs. Orosi Public Utility District MSR Page 4-24 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.6 OPPORTUNITIES FOR SHARED FACILITIES The purpose of this section is to evaluate opportunities for a jurisdiction to share facilities and resources, thereby increasing efficiency. 4.6.1 Shared Facilities Since the location of the Orosi SOI Boundary is immediately adjacent to the Cutler SOI Boundary, opportunities for shared facilities and/or resources exist. The Orosi PUD and Cutler PUD take advantage of shared infrastructure by operating a single WWTF through a JPWA comprised of three Board members from each District. In 2001, the communities of Cutler and Orosi submitted an application to Tulare County LAFCO to become an incorporated City. It was subsequently determined to be infeasible at the time, on the basis of insufficient tax revenues; however, should the two communities eventually become incorporated, restructuring the provision of sanitary sewer and domestic water services will be necessary. The two Districts will need to consider combining the existing infrastructure for domestic water service and sanitary sewer service. The District’s will also need to consider adopting a uniform rate structure for all services of the City, should the Districts ultimately incorporate as a single City entity. 4.6.2 Written Determinations 1. The Orosi PUD and Cutler PUD take advantage of shared infrastructure by operating a single WWTF through a JPWA comprised of three Board members from each District. 2. If the communities of Cutler and Orosi eventually become an incorporated City, the Districts will need to consider combining the existing infrastructure for domestic water service and sanitary sewer service. The District’s will also need to consider adopting a uniform rate structure for all services of the City, should the Districts ultimately incorporate as a single City entity. Orosi Public Utility District MSR Page 4-25 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.7 GOVERNMENT STRUCTURE OPTIONS The purpose of this section is to consider the advantages and disadvantages of various government structures to provide public services. 4.7.1 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. According to the LAFCO Municipal Service Review Guidelines, elimination of overlapping boundaries that confuse the public and cause service inefficiencies should be considered to avoid unnecessary increases in the cost of infrastructure. Currently there are no foreseeable conditions that would indicate that development within the District’s SOI would result in a change in government structure. It should be noted that although the current SOI boundary for the Orosi PUD and Cutler PUD are adjacent, there are no boundary conflicts between the Districts (reference Figure 4-1). In 2001 the communities of Orosi and Cutler submitted an application to LAFCO to become an incorporated City; however, it was subsequently determined to be infeasible because the combined tax revenue between the communities was insufficient to maintain the minimally acceptable un-appropriated reserve fund required for incorporation. However, incorporation may be feasible in the future for both communities and the procedures for incorporation are clearly identified in LAFCO guidelines. Tulare County LAFCO has adopted specific policies for reviewing proposals for a change in organization, reorganization, incorporations, dissolution and other proposals processed by Tulare County LAFCO. Tulare County LAFCO policy C-1 identifies factors and standards to be considered in review proposals including additional requirements for City annexations, standards for annexation to special districts, standards for the formation of special districts, and standards for City incorporation. Tulare County LAFCO policy C-2 outlines general procedures for changes in boundaries or organization to be processed by LAFCO. Generally, proposals for changes in boundaries, formations, or changes of organization can be submitted for the consideration of LAFCO by petition of the registered voters or affected landowners; however, prior to the circulation of any petition, a “Notice of Intent to Circulate” must be presented to the LAFCO Executive Officer. A proposal may also be initiated by a resolution adopted by the governing body of any related public body (county, city or special district). The proposal must be submitted on forms available from the LAFCO staff office, or on the LAFCO website, along with the applicable number of maps, legal descriptions, and filing fees to cover the proposal submitted. 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 should continually expand and improve its water and sewer infrastructure to accommodate development within its current District Boundary and SOI expansion areas with developer assistance. 4.7.2 Written Determinations 1. If the communities of Cutler and Orosi become an incorporated City, it is likely that a single SOI which incorporates the areas within each District’s current SOI would be established as a starting point. Incorporation would ultimately result in the dissolution of the Orosi PUD, as well as the Cutler PUD. Any changes in organization should be completed in accordance with LAFCO policies and procedures. Orosi Public Utility District MSR Page 4-26 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 2. 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. 3. The District should continually expand and improve its domestic water and sanitary sewer infrastructure to accommodate development within its current District Boundary and SOI areas zoned for development with developer assistance. Orosi Public Utility District MSR Page 4-27 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.8 EVALUATION OF MANAGEMENT EFFICIENCIES The purpose of this section is to consider the management structure of the jurisdiction. 4.8.1 Organizational Structure Based upon a review of information provided by the Orosi PUD, it appears that the provision of domestic water service and sanitary sewer collection are managed in an efficient manner, meeting the needs of the community and ratepayers. The Orosi PUD has accounting and finance functions, current personnel regulations and resolutions. The District undergoes annual audits in compliance with auditing standards. The age of the District’s sewer infrastructure is becoming an issue that the District needs to address in the short-term. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. The Orosi PUD is governed by a five-member Board of Directors elected at large from within its boundaries that is responsible for setting policy and general administrative procedures. It should be noted that three of these board members also serve on the Cutler-Orosi JPWA. The District currently operates with part-time and full-time staff, and contracts out for other services, including engineering, legal counsel, accounting, and other consulting services. The District operates from 8:00 a.m. to 5:00 p.m., Monday through Friday. The District’s answering message provides the public with the operational hours of the District and contact information in case of emergencies. Based upon the District’s 2005-06 budget approximately $74,500 was appropriated for contingencies. Contingency funds can be used for emergency improvements and/or unforeseen replacement or rehabilitation costs. 4.8.2 Written Determinations 1. Based upon information made available, it appears that the provision of domestic water service and sanitary sewer collection is managed in an efficient manner and meets the needs of the community and ratepayers. 2. The age of the District’s sewer infrastructure is becoming an issue that the District needs to address in the short-term. The District is implementing a phased sewer collection system rehabilitation/replacement project, and has awarded a contract for the construction of the phase 1 improvements. 3. The Orosi PUD is governed by a five member Board of Directors elected at large from within its boundaries and is responsible for setting policy and general administrative procedures. 4. The District currently operates with a part-time and full-time staff and contracts out for other services, including engineering, legal counsel, accounting, and other consulting services. 5. The District’s answering message provides contact information in case of emergencies as well as the District’s hours of operation. Orosi Public Utility District MSR Page 4-28 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01 4.9 LOCAL ACCOUNTABILITY AND GOVERNANCE The purpose of this section is to evaluate the accessibility and levels of public participation associated with the Orosi PUD’s decision-making processes. 4.9.1 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 Orosi PUD has a five member Board of Directors elected by voters residing within the Districts Boundary. Regularly scheduled Board meetings, which are open to the public, are held on the second Tuesday of each month at 7:30 p.m. at the District office located at 12488 Avenue 416 in Orosi. 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 Orosi 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. 4.9.2 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 second Tuesday of each month at 7:30 p.m. 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. Orosi Public Utility District MSR Page 4-29 Tulare County LAFCO MSR G2_4 Orosi Apr06.DOC/55-7301-01