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14 - Amending Sewer RatesItem No. 14 TO: Mayor & City Council Grayson Path, City Manager FROM: Gene Anderson, Finance Director SUBJECT: SEWER RATE INCREASE DATE: February 8, 2021 BACKGROUND: The City has been working and planning towards building a new Wastewater Treatment Facility for several years. The new plant will be a combination of new plant and the use of existing plant facilities where possible. This approach holds down the project cost. The new plant will have the same geographic footprint as the existing plant which is a cost savings to the City since we will not have to acquire additional property. This project nevertheless will require long term financing which will need to be supported by the Wastewater Utility Rate. City Staff, Garver Engineering (project engineers), and NewGen Strategies & Solutions (City's rate consultant) have considered various options for easing into the required rate increase. Our goal was to phase in the needed rate increase and thus help our community acclimate to the necessarily higher sewer rates while at the same time raising sufficient revenue to make the debt service payments. STATUS OF ISSUE: On January 25, 2021 the City Council was presented three rate increase options that would be capable of funding the debt that will be issued to cover Phase 1 and Phase 2 costs of design and construction of the new wastewater plant. After consideration, the City Council voiced their approval of the semi-annual rate adjustment option to finance the forthcoming Certificates of Obligation (CO). The Council will consider adopting an ordinance that increases sewer rates over time to fund the proposed debt issue. BUDGET: The proposed ordinance goes into effect April 1, 2021 and will increase the wastewater revenue stream. A new construction fund and a new Interest & Sinking Fund will be established to handle the expenditure of the CO proceeds and to make the required debt payments. OPTIONS: 1. Approve the proposed sewer rate ordinance. 2. Reject the proposed sewer rate ordinance and give city staff further directions. RECOMMENDATION: Motion to approve the proposed sewer rate ordinance. ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS, AMENDING SECTION 34-23(a), "SEWER RATES—FOR CUSTOMERS USING CITY WATER," OF CHAPTER 34 OF THE CODE OF ORDINANCES OF THE CITY OF PARIS, TEXAS TO REFLECT CHANGES RECOMMENDED BY THE CITY'S RATE CONSULTANT; PROVIDING A REPEALER CLAUSE, A SEVERABILITY CLAUSE, A SAVINGS CLAUSE, A PENALTY CLAUSE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, on the 251h day of January, 2021, the City Council of the City of Paris, Texas, was presented multiple sewer rate options prepared by NewGen Strategies and Solutions LLC, WHEREAS, on January 25, 2021, the City Council has determined that it is in the best interest of the City of Paris and its citizens to implement the proposed semi-annual rate increases for sewer services recommended by the City's rate consultant NewGen Strategies and Solutions, LLC by amending portions of Article Il, "Service Charges," Chapter 34, "Water, Sewer, and Sewage Disposal," of the City of Paris Code of Ordinances; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the findings set out in the preamble to this ordinance are hereby in all things approved. Section 2. That Subsection (a) of Section 34-23 of the Code of Ordinances of the City of Paris, Texas, be, and the same are hereby amended to read in their entirety as follows: "Sec. 34-23. Sewer rates - For customers using City water. "(a) Charges for sewer service furnished by the City to residential, commercial and industrial customers shall be based upon customer class and meter size, incorporating a base monthly cost for the first increment of usage and a cost for each additional one hundred (100) cubic feet or portion of one hundred (100) cubic feet above the first increment, as shown in the following table:" Section 3. That the Table attached hereto as Exhibit A is a part of this ordinance and shall be published as part of Sec. 34-23. Section 4. That sewer rates established in Sections 2 and 3 above shall be effective beginning with April 1, 2021 consumption. Page 1 of 2 Section 5. All provisions of the ordinances of the City of Paris, Texas in conflict with the provisions of this ordinance are hereby repealed, and all other provisions of the ordinances of the City of Paris not in conflict with the provisions of this ordinance shall remain in full force and effect. Section 6. The repeal of any ordinance or part of ordinances affected by the enactment of this ordinance shall not be construed as abandoning any action now pending under or by virtue of such ordinance or as discontinuing, abating, modifying, or altering any penalty accruing or to accrue, or as affecting any rights of the municipality under any section or provisions of any ordinance at the time of passage of this ordinance. Section 7. It is the intention of the City Council of the City of Paris that this ordinance, and every provision hereof, shall be considered severable, and the invalidity or partial invalidity of any section, clause, or provisions of this ordinance shall not affect the validity of any other portion of this ordinance. Section B. Any person violating any of the provisions of this ordinance shall be guilty of a Misdemeanor and, upon conviction, shall be fined in accordance with Section 1-6 of the Code of Ordinances and each and every day's continuance of any violation of the above -enumerated section(s) shall constitute and be deemed a separate offense. Section 9. Introduced and read on February 8, 2021, at a regular meeting of the City Council of the City of Paris Section 10. That this ordinance shall become effective from and after its passage and publication as required by law. PASSED AND ADOPTED this 8th day of February, 2021. ATTEST: Janice Ellis, City Clerk APPROVED AS TO FORM: Stephanie H. 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