Sewer Fund money is allocated to City Maintenance workers –

The full time equivalent of more than 5 maintenance employees is paid by using the Sewer Fund. (See chart below; see City sewer transfer charge detail.)   City documentation for 2010-11  indicates that the time of 4 of these employees is charged exclusively to the City sewer system.  Although not shown here, there is an additional charge made to the Sewer Fund for the compensation of administrative staff.

                                                                        City Maintenance Worker Cost paid from the Sewer Fund

While the City has emphasized the need for a proposed tax surcharge (Measure A) due to new EPA compliance costs, the continuing annual $1 million “transfer out charge” to the General Fund may represent a bigger issue.  Dollars transferred out to the General Fund for maintenance salaries and benefits are unavailable for sewer mains replacement.  (Generally outside contractors undertake general sewer project work involving mains replacement, while city workers perform maintenance.)

        EPA Compliance Cost Chart

*EPA costs may also include a one-time $400,000 cost of a vactor truck

New EPA monitoring, reporting and maintenance costs are less than the annual “transfer out charge.”  The City consultant’s cost impact report indicates the City’s annual costs for EPA monitoring, reporting, and maintenance will be $165,000 per year after one-time initial set up costs of $1.5 million.  (One-time costs may eventually also include a $400,000 vactor truck, though not currently required.)   (See blue chart; see EPA Costs article.)

This compares to an annual $1 million “transfer out” from the Sewer Fund to the General Fund.

Ongoing EPA monitoring, reporting and maintenance costs will also be relatively minor compared to yearly mains replacement costs.  General sewer projects cost rose to $2 million for the 2 years between 2007 and 2009.  In 2011-12 the city plans to spend $600,000 on mains replacement for:

• $160,000 on Calvert Court/Dudley before street re-paving occurs,
• $150,000 on Beach playground for mains replacement and storm drain replacement before new asphalt is installed with school bond monies, and
• $300,000 on El Cerrito/Hillside/Magnolia/Witter for unspecified “emergency” mains replacement

New EPA costs will exacerbate, but not change, the fundamental underlying financial issues which the Sewer Fund faces:

• 50% of fund revenues “transferred out” to the General Fund annually for general unidentified City maintenance tasks;
• the cost of yearly sewer mains replacement versus phased mains replacement;
• fund deficits created by the chosen replacement time frame of 6-10 years for completion
  

Simple Sewer Questions

Question 1:  According to the new information from the Director of Public Works:  “With the progress of the rehabilitation projects, the number of overflows has been reduced from 13 in 2005 to 3 in 2011. That is a 400% improvement.”  During the same period, the annual “transfer out charge” from the Sewer Fund to the  General Fund for maintenance salaries, benefits and supervision has increased from $700,000 to $1 million per year.  Why?

Question 2:  Shortly prior to the retirement of the former Public Works Director, monies spent on outside contract sewer replacement work escalated from $350,000 to $750,000; it then jumped again to $1.3 million.  This year it will be $600,000.  To what extent should spending on ongoing sewer “spot” replacement be controlled/reduced to ensure tax monies are available for the comprehensive phased mains replacement?

Question 3: Taxpayers are being asked to pay more to cover the costs of sewers. Yet no records are kept by the City to verify that maintenance workers paid through the Sewer Fund are spending their time on sewer maintenance. Why are no records kept of the time and tasks of the many City employees compensated through the Sewer Fund?

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