The proposed resolution combines and updates the two resolutions listed under Previous Council Action. The new resolution supersedes the two old resolutions. The new resolution carries forward all rates established in the previous fee and charge resolution without change except for charges related to water meters for new construction, the deposit on fire hydrant construction meters, and an increase in the fee for on-line bill payment transactions for payment of the utility bill.
In 2008, the City added the option for City of Allen customers to pay their utility bill on-line. This provided an additional payment method to check by mail, bank drafting, drop box payment, and in-person credit card or check payment at the Utility Billing window at City Hall. In order to provide this on-line bill payment method, the City contracts with a vendor for this service. The City's initial on-line fee was set at one dollar ($1.00) per transaction, which only covers a portion of the City's costs for the service.
The water and sewer fund currently collects about $120,000 in on-line fees annually while paying about $480,000 in on-line vendor and credit card fees. As part of the 2017 Water and Sewer Rate Study and while developing the Fiscal Year 2017-2018 budget, it was recommended that the on-line fee be increased to two dollars ($2.00) per transaction. The proposed resolution implements the higher on-line fee. The increased fee will double the currently collected fee to about $240,000 per year.
The fee increase related to water meters for new construction and the deposit on fire hydrant construction meters, is based on the need to cover the City's actual costs for the meters. The current Resolution established a set amount for the meters, which did not allow the City to pass through the costs increases related to the actual meters.
The Water and Sewer fund's meter supply contract allows increases in water meter costs that are fair and reasonable. The last meter price increase was in 2011. The current provider, Core and Main, is increasing prices by 3.5 percent for all meters but fire hydrant (construction) meters, which are increasing by 19.6 percent. The new prices are deemed fair and will remain valid through September 30, 2019. A copy of their notification letter is attached.
The City passed a rate resolution reflecting the increased water meter costs and established a deposit for entities that drew a fire hydrant construction meter form the City. The proposed resolution proposes to simply state that the cost charged for all initially set meters is the actual cost to the City at the time the meter is set. Fire hydrant, also termed construction water meters, are issued for temporary use by the utility billing office. For fire hydrant construction meters, the resolution establishes the meter deposit to be equal to the meter cost at the time the account is established.
It is important to note that these costs are for new meters set at the time of construction. The City continues to implement the meter replacement program, which is on a 10-year replacement cycle and is included in the Water and Sewer Fund. The cost for replacement meters are not passed on as a direct expense to the customers.