HomeMy WebLinkAboutAgenda - 05-19-2009 - 6bORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: May 19, 2009
Action Agenda
Item No. (p - b
SUBJECT: Efland Sewer Low-Income Rate Assistance
DEPARTMENT: County Manager PUBLIC HEARING: (Y/N) NO
ATTACHMENT(S):
1. Efland Sewer Rate Increase Schedule
2. Memo from Town of Hillsborough's
Water Sewer Advisory Committee
Recommending Efland Customers Be
Allowed to Use the Town's Water
Assistance Program Funds for Sewer
Bill Assistance
3. Memorandum from Town Manager
Eric Peterson Approving Efland
Customers Use of the Town's Water
Assistance Program Funds for Sewer
Bill Assistance
INFORMATION CONTACT:
Kevin Lindley, Engineering Specialist,
245-2313
PURPOSE: To provide information on assistance options for low-income customers. of the
Efland Sewer System.
BACKGROUND: The Efland Sewer System was conceived in the early to mid-1980s as a
remedy for failing septic systems in the Efland Community. The Efland Sewer System was
established by Resolution of the BOCC in November 1985. The rates set at the time were
sufficient for the operation of the system. However, over the last twenty years the costs of both
operation and maintenance have increased steadily while the rates have remained unchanged.
At the present time the revenue generated by the current rate structure accounts for only 20-
25% of the full cost of operating and maintaining the system. The remainder of the system cost
is paid from the Orange County General Fund.
With this in mind the BOCC authorized creation of a rate increase schedule that would be
implemented over the next four fiscal years, beginning on July 1, 2009. This schedule is
included as Attachment 1. Because of the disparity between the costs to run the system and
the revenue generated by the current rates, the rates will be increasing substantially. Even
spread over four fiscal years the rates may be difficult for some customers, especially those
with lower incomes.
Recognizing this, the BOCC asked staff to investigate options for assisting low-income
customers with these increased sewer rates. Engineering staff met with Staff Attorney Annette
Moore and representatives from the Tax Office (Jo Roberson), Department of Social Services
a
(DSS) (Nancy Coston), ,Finance (Gary Humphreys), and the Manager's Office (Willie Best).
This meeting resulted in the following conclusions:
• It would be not be legal for the County to offer sewer bill assistance to low-income Efland
Sewer customers exclusively. If sewer bill assistance were to be offered to low-
income Efland Sewer customers, then every income-eligible resident of Orange
County would be entitled to the same assistance.
• It would not be legal for the Efland Sewer fund to offer a discount rate to low-income
Efland Sewer customers.
• There are currently programs in place to which low-income Efland Sewer customers
could turn if they needed assistance on their sewer bills. These programs are the
DSS Emergency Assistance (EA) program and the Samaritan Relief program
administered by Orange Congregations in Mission (OCIM).
Based on these findings, it appears the BOCC has several choices.
• Build Upon an Existing Program. Use existing County and community programs to
take care of low-income customers of the Efland Sewer System. The EA program
through DSS is already available to help low-income residents with utility bills when
the utility is in danger of being shut-off. Resudents who qualify for this program would
also qualify for the OCIM program mentioned above. Additionally, the Town of
Hillsborough operates a Water Assistance Fund under which its utility customers
make donations the Town accumulates and then makes available to OCIM to
administer to Town customers having difficulties paying their bill. The Town has
agreed, based on a recommendation from its Water Sewer Advisory Committee, to
allow OCIM to make their Water Assistance Fund available to Efland Sewer
customers for the first year (FY 2009-2010) (see Attachment 2 and 3). Town staff
has projected sufficient funds in the Water Assistance Fund next year to cover
participation by eligible Efland Sewer customers. The demand for this service and
therefore the need for this type of assistance could be tracked and used to establish
funding levels for future years if needed.
• Establish a new County Wide Program -Set up a program designed to help any
qualifying low-income residents of Orange County with their sewer bills. Since it is
open to the whole County, this type of program would likely end up costing more than
the General Fund subsidy to the Efland Sewer System that is being phased out by
the increase in sewer rates.
The DSS and OCIM programs work essentially the same way, including the OCIM program
funded by the Town of Hillsborough. A resident comes in with a utility emergency which is
defined as a notice from the utility that service will be shut-off unless the past due bills are paid.
DSS assesses the income level of all participants in either program. In other words, even if a
resident contacted OCIM first, the individual would be referred to DSS to determine qualification
for the program before OCIM would offer monetary assistance. If the resident with the
overdue/shut-off notice qualified for assistance (basic requirement is 200% of poverty level
income or below), then a check would be written to the utility company for the past due amount,
up to $150 every six months for DSS and up to $100 every six months for OCIM. DSS and
OCIM communicate with one another to make sure the same emergency is not paid for by both
agencies. The majority of customers of the Efland Sewer System will see their bill go up by less
than $20 per month on July 1, 2009, so the current programs should be adequate to address
the incremental sewer bill increase for the first fiscal year (2009-2010). All customers will
3
receive information on the two programs currently available and be given instructions on how to
go about receiving aid, if needed.
Regardless of the Board of Commissioners decision on how to proceed with the low-income
assistance policy, staff recommends the new sewer rate schedule be implemented in time for
the first increase to begin on July 1, 2009. The Efland Sewer budget projections for FY 2009-
2010 include revenue based on 12 months at the increased rate. An amendment to the Efland
Sewer Resolution is needed In order to implement the new rate schedule.. This amendment
will be brought to the BOCC as a separate item.
FINANCIAL IMPACT: Depending on the option chosen, the financial impact could vary from $0
(Town of Hillsborough Water Assistance Fund) to $120,000 or more (New County-wide
Program). County general funds would be the source for any new Emergency Assistance
appropriation.
RECOMMENDATION(S): The Manager recommends the Board direct staff to
1) Implement an information and referral process to alert all Efland Sewer customers on
how to access Emergency Assistance programs administered by both Social Services
and OCIM, including that funded by the Town, to help eligible households pay their utility
bills; and
2) Monitor and assess the demand for Emergency Assistance caused by increased sewer
rates during the first year (FY2009-10) and use those findings to formulate
recommendations to the Board about future levels of assistance that may be necessary.
Efland Sewer Monthly Bill Projections for Customers Using Between 1000 and 6000 Gallons ner Month
Rate
*Base Charges -Every customer
pays this, regardless of usage
*Chazge per 1000 gallons
Monthly Customer Bills
Monthly Usage
1000 gallons
2000 gallons
3000 gallons
4000 gallons
5000 gallons
6000 gallons
Current Rates Proposed Rate Increases
(Unchan ed since 1987) July 2009 July 2010 Jul 2011 July 2012
$1.70 $7.25 $10.16 $14.12 $19.62
$4.50 $6.30 $8.82 $12.26 $17.04
NOTE: Currently,
customers pay $15.20
for 3000 gallons or less
per month **Under new rate structure, there will no longer be a
3000 gallon minimum chazge. INSTEAD, there will
be a base chazge that everyone will pay PLUS a charge
er 1000 allons of usage.
- $15.20 $13.55 $18.98 $26.38 $36.66
$15.20 $19.85 $27.80 $38.64 $53:71
$15.20 $26.15 $36.62 $50.90 $70.75
$;19.70 $32.45 $45.44 $63.16 $87.79
$24.20 $38.75 $54.26 $75.42 $104.83
$28.70 $45.05 $63.08 $87.68 $121.87
-~.
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Town
of
Hills
~~~
a;1994 Town of H71eAOrw,
To: Mayor Tom Stevens
Frances Dancy
Michael Gering
L. Eric Hallman
Evelyn Lloyd
Brian Lowen
Eric Peterson
Nicole Ard
Memorandum
December 5, 2008
Re: Efland Cheek Sewer Customer Participation
in the Hillsborough Water Assistance Program
From: The Water Sewer Advisory Committee
Funding assistance programs are being sought to supplement current Efland Cheek Sewer
Customers once a required rate increase is implemented. Unfortunately, a County funded assistance
program will not be available until after the increase has been implemented. It was suggested that
maybe these customers could use Water Assistance Funds since they are theoretically Hillsborough
customers with Orange County as the intermediary.
A brief background summary of the Efland Cheek Sewer System, the rates and its customers is
included on the following page.
Town staff approached the Water Sewer Advisory Committee for their thoughts and
recommendations on allowing the Efland Cheek Sewer Customers access to the Town's Water
Assistance Funds at OCIM if they qualify through Orange County Social Services.
After a brief discussion, the Water Sewer Advisory Committee made a Motion of Consent to make a
recommendation to the Hillsborough Town Board Commissioners, to allow Efland Cheek Sewer
Customers Access to the Water Assistance Program Funds at OCIM through the existing qualification
process of Orange County Social Services. The only stipulation is that Efland Cheek Customers be
given the information and opportunity to make contributions to the fund.
cc: Laura Blackmon, County Manager
Kevin Lindley, Orange County Engineering Specialist
Rev. Sharon Freeland, OCIM
Kenny Keel, Town Engineer/Utilities Director
101 East Orange Street ~ P O Box 429 ~ Hillsborough, NC 27278 ~ 919 732 1270
Town
of
1~~S
~~ ins
~0
May 14, 2009
NJ199a 7oHn Uf i~ld~hmouph
To:
From:
Re: Efland Cheek Sewer Customer Participation
in the Hillsborough Water Assistance Program
Rev. Sharon Freeland, Executive Director, Orange Congregations and Missions
Ms. Nancy Coston, Director of Social Services, Orange County
Mr. Eric J. Peterson, Town Manager, Town of Hillsborough~jo
Orange County is in the process of raising rates to make the Efland Sewer Fund fiscally solvent, but
the County Commissioners have concerns about the financial impact on the current users. County
Staff was instructed to seek outside funding assistance for the affected citizens. During their
research, it was discovered that the Town of Hillsborough already has a successful utility assistance
program that is administered through Orange Congregations and Missions with referrals from Orange
County Social Services.
!n a community minded spirit as a means to ease possible financial burdens caused by the rate
increase, the Town of Hillsborough is willing to make Water Sewer Assistance Funds available to
Efland Sewer Customers (billed through Orange Alamance). The Water Sewer Advisory Committee
recommended to the Town Board of Commissioners that the Efland Sewer Customers should be
considered eligible for the Funds as they are indirect sewer customers #hrough Orange County. The
Hillsborough Commissioners were briefed on the recommendation and concurred.
The Efland Sewer Cus#omers will become eligible for the funds after the first phase of the rate
increase goes into effect on July 1, 2009.
If any additional informa#ion is needed, or if you have any questions concerning this memo, please
feel free to contact me.
cc: Ms. Kay Stagner, OCIM
Ms. Louise Maize, Orange County
Ms. Laura Blackmon, County Manager
Ms. Nicaie Ard, Assistant Town Manager, Hillsborough
Mr. Kenny Keel, PE, Engineer/Utilities Director, Hillsborough
Mr. Paul Thames, PE, Engineer, Orange County
Mr. Kevin Lindley, ~'E, Engineering Specialist, Orange County
101 Tcist Orange Street • P.O. Box 429 Hillshorou~h, Nvrth. Carolina 2727b'
919-7.32-1270 Fcrx 919-644-2390