Authorizes staff to schedule a Public Hearing to consider a resolution adopting revised Lee County Utilities Miscellaneous Service Charges.  These Miscellaneous Service Fees were last modified and Board approved in August 2011.  A “Water and Wastewater Miscellaneous, Wholesale and Connection Fee Study” was performed by Lee County Utilities’ financial rate consultant, Raftelis and issued in September 2020.  The final report recommended fee changes and the creation of several new fees.  The fees will offset increases in the annual consumer price index and help fund future projects such as the Three Oaks Wastewater Treatment Plant Expansion, Southeast County Water Reclamation Facility, force main and Gateway expansion projects.
 
The proposed resolution does not include recommendations for monthly water and sewer user rates and therefore, monthly customer billing for services will not be increased by this action. 

The current Utilities charges for Miscellaneous Service Fees were adopted by Lee County Resolution 11-08-26 on August 9, 2011. (Bluesheet #20110562). 

A “Water and Wastewater Miscellaneous, Wholesale and Connection Fee Study” was performed by Lee County Utilities’ financial rate consultant, Raftelis.  The final report issued in September 2020, with recommended fee changes, was revised in January 2021. The proposed rate changes will allow for adequate coverage of costs associated with increased operating equipment and labor expenses realized over the last ten (10) years, as well as the capital infrastructure by way of connection fees.   No increases were recommended to the monthly water and sewer user rates and were not part of this analysis.

Since the previous Miscellaneous Fee Study was performed in June 2011, we have experienced annual average Consumer Price Index for All Urban Consumers (CPI-U) changes.  This resulted in a cumulative increase of 17.3%, and the increase in fees will help offset those CPI increases we have realized in our Operating expenses.

Additionally, the cost of new meters associated with our Advanced Metering Information (AMI) System Project represents a price increase over our former, traditional meters.  While the cost of meter replacements was covered under the AMI Capital Project, the increased cost for new development meters needs to be passed on to the new account holder.  The updated drop-in/tap-in fees will bring in an estimated $227,000 in revenue annually to offset the higher costs of the new meters.

Recommended increases to the water and sewer connection fees, which have not been increased since 2007, will help provide funding for future capital infrastructure costs.   The $455 cost increase in our water connection fee will help fund our growing water infrastructure needs, particularly the expansion of the North Lee County Wellfield and North Lee County Water Treatment Plant expansion.  The $480 cost increase to our wastewater connection fees will help future wastewater capacity projects, such as the Three Oaks Wastewater Treatment Plant Expansion, the new Southeast County Water Reclamation Facility, and the Gateway expansion project. Combined, these connection fee increases may bring in an additional $2,500,000 in annual revenue based on the prior three-year history.

As a part of this study, no increases were recommended to the monthly water, sewer, and wholesale user rates. A complete list of the fees being changed is on the attached Fee Table, including new fees for Account Searches, Lien Placement or Release, 3” Hydrant Meter Security Deposit, and Temporary Hydrant Servicing Fee.   

In the review of all Lee County Utility External Fees, three have been deemed obsolete by staff.  EX13-16 (Sludge Hauling), EX13-17 (Utility Permit Fees), and EX13-19 (Leak Inspection Charge) are recommended to be deleted from the County’s External Fees Manual.  Board approval is required for this action.

Attachments:

1. Water and Wastewater Miscellaneous, Wholesale, and Connection Fee Study
2.  Table Containing Summary of Recommended Fee
3.  Consumer Price Index Data
4.  Ord. 02-32 (Utility Rate Adjustments)

1. The increases to the Miscellaneous Fees will add additional revenue to Lee County Utilities. Based on the average revenues of the past three (3) Fiscal Years, Lee County Utilities could see an estimated annual increase of just under $3,000,000. This will be primarily in the form of water and wastewater connection fees. The connection fee revenue is limited to Capital projects that increase water or wastewater capacity and benefit the new users of the system.