Feb 17 2012

Sewer Fund to Receive More Scrutiny?

Municipal Tax Review Committee Chair Proposes Review of Substantive Issues Raised During Election

Council Members:

On behalf of the Municipal Tax Review Committee, I am writing to recommend that you call the MTRC back into session to address the issue of sewer fund financing in the wake of the Measure A failure.  The defeat of Measure A still leaves the city to face increased sewer management requirements with accompanying long term financial obligations.  Although MTRC undertook a review of these issues as part of its overall work plan last year, a significant number of substantive questions arose during the community debate over Measure A between December and the election last Tuesday.  The run-up to an election is a poor time to be answering these types of detailed challenges dealing with finance, legal mandates and multi-jurisdictional decision-making.  If the city is to have any chance at fully funding its sewer program in the next few years, it is essential that these questions get answered in a thoughtful, comprehensive way.

I am therefore proposing that you call MTRC back into session beginning around the middle of next month.  As before we would meet biweekly or twice monthly, depending on availability of the Council chamber.  Given the controversies around Measure A, I believe we should continue the practice of meeting in the chamber, with KCOM coverage, so that our analyses, discussions, deliberations and decisions are open to the whole city.  In between the meetings, a research sub-committee could work with city staff to compile all the relevant questions that have arisen or that are brought to our meetings by interested citizens, and help assemble required background materials, including planning reports, financial data and legal documents.  I think it is possible that we might also invite representatives from the regional EPA office, East Bay MUD and possibly even some of the other satellite cities so that they can share with everyone at the same time their answers to key questions about which they might have particular knowledge.

The anticipated outcome would be a comprehensive report covering the major facets of the city’s sewer management and financing needs, addressing as well the questions that have arisen in the last couple of months.  MTRC would also produce a fresh assessment of the anticipated shortfall in the current revenue stream, and make one or more recommendations as to how to cover any shortfall that is verified.  The final recommendations might include proposals concerning the existing sewer fund budget, a new proposal for a temporary surcharge (surely much less than the one the voters just turned down), or a combination of the two.  I am hopeful we could complete our work within 90 days, giving the Council a chance to consider our recommendations at the time you act on the 2012-13 budget, and also giving you sufficient lead time before the November election, if we were to recommend another ballot measure.

Before posting this message to you, I have advised the MTRC members of my intention to send in this recommendation.  No one on the committee has indicated an unwillingness to resume work on this critical subject.  On the assumption that Mr. McBain will be joining the Council next month, I assume he would not continue as a member of MTRC; the Council could decide either to continue with the remaining eight members, or to add a ninth member.  I have no preference on that matter.

The MTRC looks forward to hearing from the Council in the near future, and to developing a workable resolution to the multiple challenges of sewer system management, EPA compliance, and mains replacement.


Michael Rancer
2011 Municipal Tax Review Committee Chair

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