HomeMy WebLinkAbout2022-05-24 Water Board Public Hearing on the Proposed Water RatesMINUTES
WATER BOARD PUBLIC HEARING ON THE PROPOSED WATER RATES
COUNTY OF HAWAI`I, DEPARTMENT OF WATER SUPPLY
May 24, 2022
West Hawaii Civic Center, Building G, 74-5044 Ane Keohokalole Highway, Kailua-Kona, Hawaii
MEMBERS PRESENT: Mr. Kenneth Sugai, Water Board Member
Mr. Benjamin Ney, Water Board Member
Mr. Michael Bell, Water Board Member
Mr. Porto Kekela, Water Board Member
Mr. Keith K. Okamoto, Manager -Chief Engineer, Department of
Water Supply (ex-officio member)
ABSENT: Mr. David De Luz, Jr., Chairperson
Mr. Steven Hirakami, Vice -Chairperson
Ms. Julie Hugo, Water Board Member
Ms. Kea Keolanui, Water Board Member
Mr. Stephen Lopez, Water Board Member
OTHERS PRESENT: Ms. Diana Mellon -Lacey, Deputy Corporation Counsel
Ms. Ann Hajnosz, Harris & Associates (via Zoom)
Ms. Karyn Johnson, Harris & Associates (via Zoom)
DEPARTMENT OF Mr. Kawika Uyehara, Deputy
WATER SUPPLY STAFF: Ms. Candace Gray, Waterworks Controller
Ms. Janet Snyder, Information and Education Specialist II
(Board Member Sugai called the meeting to order at 6: 00 p.m)
K. SUGAI: Good evening. Would the Public Hearing on the proposed water rate schedules for the Department
of Water Supply please come to order. I am Ken Sugai, member of the Water Board, and I'll have the members
of the Board and staff introduce themselves.
P. KEKELA: Pono Kekela from Council District 4, representing Puna, Kalapana, and (inaudible).
M. BELL: Michael Bell, District 7.
B. NEY: Benjamin Ney, District 9.
MANAGER -CHIEF ENGINEER: Keith Okamoto, Manager -Chief Engineer, Department of Water Supply;
and with me, we have Kawika Uyehara, our Deputy, Candace Gray, our Waterworks Controller, Doreen
Jollimore, Secretary, Janet Snyder, Public Information Specialist; and representing Corp. Counsel, Diana
Mellon -Lacey.
K. SUGAI: The Department of Water Supply is operated and controlled by this Water Board as provided for in
Article VIII of the Hawaii County Charter. Upon recommendation by the Department, the Water Board
Page 1 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
authorized the Manager to hire a water rate consultant to review the adequacy of the existing rates. Harris &
Associates of Seattle, Washington, was contracted for this purpose. Section 63 of Part 111, Chapter 54, Hawai`i
Revised Statutes, reads as follows: "The board of water supply may fix and adjust rates and charges for the
furnishing of water and for water services such that the revenues derived therefrom shall be sufficient to make
the waterworks and water systems self-supporting and to meet all expenditures authorized by this part; the board
may establish variable rates among the several districts of the county, or among the areas served by the
individual water systems within the county, for the purpose of establishing charges as closely as possible to the
necessary amount required for the maintenance and operation of the particular individual water systems;
provided no rates and charges shall be fixed or adjusted prior to the holding by the board of a public hearing,
public notice of which shall have been given not less than twenty days before the date set for the hearing. The
notice shall state the time and place for the hearing and the proposed rates and charges to be considered thereat.
The time within which the notice shall be given shall be computed by including the first day (the day of the
notice) and excluding the last day." Notice of this public hearing was published in the Hawaii Tribune -Herald
and in the West Hawaii Today on May 3, 2022. We are here to receive comments or testimony on the proposed
rates. As stated in the hearing notice, all comments or testimony were to be filed in writing before the time of
the hearing or are to be presented in person at the time of the hearing. We would like to follow this format as
closely as possible. However, because there may be some of you who do not have any written statements but
would like to testify or comment, we would like to afford you this opportunity to do so. Doreen, is there any
written testimony?
D. JOLLIMORE: No, Mr. Sugai.
K. SUGAI: There being none, we will now hear from Ann Hajnosz and Karyn Johnson of Harris & Associates.
A. HAJNOSZ: Thank you everyone. Aloha, and good evening. I'm Ann Hajnosz; I'm joined by my with my
colleague, Karyn Johnson, Harrison & Associates, and we've got a presentation to walk you through how the
rate proposal was developed. So the topics we're going to cover is providing you with an overview of the rate
study; we'll talk about the rate study results, and Karyn will talk about how they were specifically developed
that came up with the water rate proposal that you've all seen; and then we'll talk about next steps in the
process. So first of all, it's really important to understand how the rates were developed; and rates, first of all,
are set so that they can be sufficient to pay for the ongoing operational and capital costs associated with the
Department of Water Supply in fulfilling their mission. We also want to look at rate structure and establishing
the fixed portion and the variable portion that aligns with the Department's goals; and, finally, we want to make
sure that the rates that are adopted are fair and reasonable for the ratepayers. The process that we follow is used
by many great experts. It follows the American Water Works Association M1 Manual --Principles of Water
Rates, Fees, and Charges. It consists of three main analyses --there's a revenue requirements analyses where we
look at the projected revenues; we looked at the projected operating and capital expenses; we calculate deficit;
and that's how we come up with the level of the rate adjustments that is needed each year. Then we do what's
called the cost of service analysis that takes that revenue requirement and portions it to the various customer
classes commensurate with the benefit or level of service that these customer classes derive from water services.
And then finally we look at rate design, or we also call that rate structures, that look at the fixed portion, the
variable portion, you look at the different customer classes to make sure that they are recovering their fair cost
of service. So this is a general idea of how the rates are set. Karyn is going to go into more details and looping
at the different key assumptions and that sort of thing. Speaking of the key assumptions, in general, these are
what we're going to be talking about, from the revenue standpoint, we look at customer growth and water usage
growth, right. You look at it historically and then we also look at it projected into the future two, three, five
years, whatever the time period is. We look at operating costs and the key assumptions that we take into
consideration, our escalation on an annual basis, as well as our staffing levels --the staffing costs are one of the
biggest portions of operating costs for water utility. And then we look at capital cost, which is another big
bucket of costs. Again, looking at escalation over a certain time period as well as the annual expenditures
themselves and then, really important, how those expenditures are going to be funded from various methods;
Page 2 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
and Karyn will go into that as well. The last thing that's really important has to do with financial policy. And
this rate study, we took into consideration these findings. We took a deeper dive into these five financial
policies, talked to the Board about those in more detail than we have in the past. And this is what we came up
with --two buckets of financial policy recommendations that are drivers for the rate level adjustments. First
bucket is the cash reserves, and this is analogous to kind of like an amount of money that is set aside for
unanticipated expenditures, and we do this both on the operating side for operating expenditures and the capital
side. So in the operating reserve, we try to set a goal of 60 days of annual operating and maintenance expense.
And this is typical, we've been doing this for the Department of Water for a while as far as a metric to hit when
setting rates. The capital reserve is a new metric where we've looked at a little more closely and we want to be
able to set that capital reserves equal to the level of annual depreciation expense or some historical average, you
know, three to five years of actual capital expenditures. And then we go into what we call debt management and
infrastructure funding, and we wanted to set financial policies around that. First one --minimum annual capital
spending. We want, you know, to be a viable operational, sustainable water utility. We want to have a
minimum level of annual capital spending equal to, again, the greater of annual depreciation expense, or some
historical average level of capital spending. How are we gonna fund that spending? Well, again, we want to
have the minimum annual rate funded capital contribution, or when we say rate funded, that's another way of
saying cash funded capital contributions that equal about the annual level of depreciation expense. Then we
look at debt and financial policies around debt. Debt service coverage is a very common ratio that water utilities
use to measure their financial viability. Debt service coverage of 1.25 your annual debt service expense means
you take your annual debt service amount and you increase it by 25%, and that's the amount of coverage that
we're talking about. That just gives financial assurance... additional financial assurance to the bondholders and
also provides more sustainable resilience to your financial operations. Finally, we look at debt as a percent of
your total or your net plant assets, and this is a new measure that we're looking at this time. Because we just
want to make sure as much as we need to fund water assets by cash and debt, we want to make sure it's the
appropriate amount of debt, right, and so there are benchmarks that water utilities use and this is one of the
benchmarks. We want to be less than, or equal to, 35%, and we can go as high as 50% and that's a common
metric that other water utilities use. So taking all of this into consideration, along with the other assumptions
that I mentioned, we proceeded to do the revenue requirements analysis, cost the service analysis, and then the
rate design; and Karyn's gonna take it from here, and she's gonna talk about the specific analyses and results.
K. JOHNSON: Good evening everyone. So as Ann stated, there are three main components of the rate study,
and each one has some forecasting assumptions and analyses that we do to come up with, you know, each of the
parts the rate analysis that drive our eventual proposed rate recommendations. So one of the first things we look
at is forecasting what the revenues would like for the Department over the time period. We start by looking at a
three-year history, and then that forms our basis for projecting what the next three years would look like. So the
first thing we do is we look at your standby charges and your consumption charge revenue. We're looking at
2019 through 2021. It is pretty much comprised of, you know, how many customers are on the system that are
paying the standby charge, and then when is the water used by those customers that derive the rate revenues. So
when we when we look past the average annual from Fiscal Year 2019 through 2 02 1, customer growth is on
average, a little less than 1% per year. That is very consistent with what it was in the last study as well. So
we've assumed that historic customer growth rate will continue through 2024, so the number of customers
connected to the system would grow and just a little bit under 1% per year through 2024 and that would help in
generating additional standby charge revenues for that fiscal growth. And then the next thing we look at is the
water usage; and, you know, over the past probably 10-plus years or so, the whole industry trend has been that
water use has been declining on a per customer basis over time due to, you know, water conservation efforts,
efficiencies, and measures like low -flow toilets and all of these kind of conservation methods. That has been
producing a trend of declining average over the last ten years. And then what we've experienced here the last
couple years, coupled with some impacts of also reductions due to the COVID-19 pandemic, we've seen about
3% per year reduction between 2019 and 2021. To give a little bit of historical perspective, prior to the 2020
COVID impacts, the Department's water use was declining about an average of 2% per year. And so what
we've seen with this last round of further reductions due to COVID, it jumped up to about a 3% reduction per
Page 3 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
year, and so we've kind of conservatively assumed that as the economy regains, that the water usage will
probably continue at about the level of 2021. So we assumed flat water consumption for 2022 to 2024. And
then, also, we looked at, so what does that mean in terms of how much revenues are generated. So over that
same three-year period, historical 2019 to 2021, revenues have increased about 3% per year, and that's a result
of the combination of historical rate increases, the limited amount of customer growth, and the declining water
sales. And so we're projecting relatively flat revenues over the next three years. We do see a slight jump
between 2021 and 2022 and that's reflective of that last 13% rate increase that was implemented January 1'r
2021, so the second half of that increase is recognized in 2022, and then remains relatively flat through the study
period, just recognizing this customer growth. After looking at what the revenue forecast is, we want to look at
what the expenses are that that revenue needs to cover. First thing is looking at the operating and maintenance
expense. We've seen that in looking at a three-year historical average, the total O&M expenses for the
Department have averaged about 2% per year increase on that time period. Two main components of that are
the pass -through power costs. Those have declined an average of about 2.5% per year, and other O&M
expenses have increased about an average of 4.5% per year. So in looking at that and what the inflation rate
estimations might be, we projected the expense, first looking at what the Department has adopted Fiscal Year
2022 budget -wise, and then we apply annual cost escalation of about 3% per year. Now, at the time we were
doing the study, that was right in line with what the historical indexes in consumer price index, which is a
common index used for forecasting inflation, was right around that 3% per year. Now, as we sit today, we
anticipate these costs are going up a little higher than what we previously projected. They're looking, right now,
at about 6% so this is something that will need to be monitored over the next year or so. We really don't know
where those costs are going to be; but it's an indication that possibly may come in a little bit higher than what
was projected. So that's something that needs to be monitored. Another adjustment to the Fiscal Year 2022
budget was we looked at the salaries and benefits, which is a pretty large component of the operating and
maintenance expenditures. And we reduced that to about 95% of the budgeted level, and that was to recognize
that there are some staffing vacancies that probably aren't going to be filled during this time period. And so not
wanting to, you know, have rates set too high, we looked at moderating that annual cost of the staffing pieces.
And, again, this is something that, you know, these are projections; and they're going to be closely monitored
and, you know, wherever inflation ends up on going through in the next year or so, you take a look at it; but
even if the industry consumer price index is going up 6% or 7%, that doesn't necessarily mean that the
Department's costs are going to go up at that level. Staff will continue to look at ways to reduce costs as
necessary and do the best to manage whatever the situation may be, if costs continue to rise. After looking at
the operating side of things, the next big bucket is the capital spending. Historical capital spending has been
about $13 million per year. You're looking at the three-year historical time period at about $20 million per year,
if you're looking at the extended 5-year period. This compares to the current depreciation expense of about
$15 million; and, as Ann mentioned previously, depreciation expense is kind of an industry standard benchmark,
a kind of minimum level of capital spending that you should have in order to sustain your system operations. As
your current assets decline, you wanna be sure that you're reinvesting in the system and refurbishing and
replacing your assets to maintain the system's integrity. So what we looked at is, you know, this chart graph to
the side shows the annual capital spending historically from 2017 to 2021; and, you know, of course, the capital
costs vary from year to year so we kind of look at the averages. We've got the three-year average on that
bottom dotted line, the five-year average being that solid line, and then where we would typically like to see
where that annual spending would be, would be a little bit higher at that ... we're on that $15 million mark to the
annual depreciation expense. So we use this as our guide in working with the Department on crafting what the
capital improvement program spending would look like over the next few years. So we're looking to maybe get
that bumped up more to the $20 million per year over the next five or so years. This is the actual capital
spending plan that was identified for Fiscal Years 2022 through 2024, and you can see here there's a list of
specifically identified capital projects. Those were based on information from the Fiscal Year 2022 budget for
projects that were identified for 2022 and that would continue on into 2023, and then additional projects
identified for 2024 that have specific funding from things other than rates, like from facilities charges, and then
you can see this line down at the bottom where we we also have an amount in here of about $14 million. That is
for the annual capital spending that we talked about where we're looking to have a level of about fourteen to
Page 4 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
fifteen million dollars of expenditures being planned over the study period. So while we aren't showing
specifically identified projects here for this dollar amount in 2024, this is something that the Department staff
would be doing on an annual ongoing basis is they would look at what their needs are, identify, and prioritize
what projects would need to be done in that year for roughly about that dollar amount. And again, the whole
idea is to have a given level of capital reinvestment to ensure the ongoing sustainability of the system. A couple
of things to point out here, we identify first what the costs are, and then how those were going to be funded. The
majority of costs are usually... we're looking at funding where we say, from the capital reserve, that means
that's money that's coming from rates, money that's coming from your cash reserves; but there are also some
projects here that have been identified for some State Appropriations and grant funding. That is money that
doesn't require rates for, so we call that, typically, you know, free money. One of that is for the Lalamilo
Reservoir. The good news is that the State Appropriation has been secured for 2022 of $8.7 million to fund that
project; and then the subsequent year, the continuation of that project would be funded with a State Revolving
Fund Loan, so that would incur additional debt. And we have, also, for the Waikoloa Reservoir, the Department
is pursuing a FEMA grant to potentially fund that first year's portion in 2022 with the second half of that being
funded with facilities charges as well. So a good portion of this profile is that there there is funding available,
other than through the rates. And so that's positive as well as looking for outside funding sources to help keep
debt and rates down. So just kind of summarizing that information, so the capital spending plan from 2022 to
2024, budgeting those projects from the previous slide, it totals about $77.5 million over this 2022 to 2024 time
period, which is an average annual spending of about $26 million per year; and, again, of that, you know, so the
bars here to the right that shows the actual capital funding spending, and then we've brought, showing how
much of that is is going to be cash funding from capital, that is this tan color, and then what's coming from debt
financing is this purple color. So what we're really illustrating in this chart is that we've identified that capital
funding through the bar charts, and then it's shown that we have identified and planned for the variety of
funding sources that would fund most of the capital projects. Again, so about $16 million from grants and other
outside sources, about $18.5 million from cash reserves/rates, and then a total about $43 million coming from
State loans. Pulling all of that information together, you take what your revenues are, what your forecasted
operating costs are, and the forecasted capital costs and you come up with what's the total revenue requirement --
the amount of money on an annual basis that needs to be recovered from your rates. And this is what this chart
here illustrates is, again, you're looking at the bar chart, we have a build up of those expenditures. The green
bar is just the forecast of the operating costs and then it moves up to and this is added on to your debt service
costs, and then looking at any contributions to reserves, and that identifies what your total need is. The dotted
line on the bottom, that shows if you didn't have any further rate adjustments and you were looking at your
current rates, you could see that revenues fall short in these last two years to recover those costs. So what we
what did is, working with Department staff and coming up with what a strategy would be to have rate
adjustments that would meet that total need. So what we derived was a two-year rate strategy of 9t/2% increases,
and those increases would be applied to the standby charges and the consumption charges, with the first 9%2%
increase being implemented July 1st, 2022, and then the second 9'/z% increase being implemented July 1st, 2023.
The goal and the achievement of these rate adjustments would be recovery of the full O&M expense projections,
the existing debt service, and then the impacts of the capital spending plan, which includes both new jobs and
additional cash funding needs for the capital. And then as Ann kind of went through before, we have specific
financial policy goals that we were looking at to make sure were met within this rate adjustment strategy --first
being operating reserves at 60 days of O&M, so this rate strategy accomplishes that, debt service coverage
meeting that 1.25% target which would mean that essentially you're recovering your debt service, plus a cushion
of about 25% to ensure that you're able to pay that debt service and then the debt to fixed asset ratio, which is,
you know, your debt as compared to the total value of your plant assets, is at about 29% and that's well within
the target of what was established, you know, looking at that being lower than 35% so this is a very positive
outcome of that metric. And then the capital reserve, which is one of the new metrics that was implemented;
and at the time, we were working with staff and the Board on figuring out, you know, what the rate adjustment
strategy would be to come up over a reasonable time period of achieving this new reserve; and it was
determined we're not going to achieve that reserve in the first couple of years. It's gonna take, you know,
five -plus to ten years to achieve that. So this current two-year strategy ends up by achieving about 60% of that
Page 5 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
target in this time period, and then the plan, of course, would be, as additional updates are undertaken over time,
you're continually looking at that and trying to build that up to achieving 100% of the target over the next
several years. This next slide is this provides a sample bi-monthly bill impact. The Department bills every two
months, so this would be an illustration of what a sample bill would look like that a customer would receive
every two months. First, I'm gonna jump over to the right side of the graphic where we're talking about, you
know, the current standby charges and the consumption charges. Those are what would increase at 9'V2% in each
of the two fiscal years. Then you have the power cost charge, which is a pass -through charge. Currently, when
we were doing the planning, it was at $2.34 per thousand gallons. We just made a planning assumption that it
would increase about 3% per fiscal year and so that is in this illustration of a potential typical bill. This is a
pass -through charge, so it can vary either up or down as it has in the past. It has the potential of changing about
every two months. Sometimes it goes up, sometimes it goes down, and we just made an assumption that it's
gonna average about 3% per year, just to put together an illustration of a potential typical bill. And then the
third charge that goes on the bill is the Department's Energy CIP charge, which is currently 0.05 cents per 1,000
gallons of water. So what this graphic is going to show is what an overall percentage bill increase could look
like for a typical customer, a 5/8-inch [meter] customer using about 24,000 gallons every two months, according
to the billing cycle, would be about 7% per year. And so I just wanted to illustrate how that breaks down
between, you know, 9'/2% for the standby and then the other charges are lower. So I'm gonna jump back then
over to the graphic where we can then see the total standby and a water usage bill for this 5/8-inch customer
with 24,000 gallons every two months. The current bill is $87.84 based on the current rate structures. That
would jump to $96.18 after that first 9'/2% rate adjustment, July I't, and then it would jump to $105.32 after that
second 9r/2% rate adjustment. The power charge illustration here would go from $56.16, to $57.84, to $59.58
and so on; and then the CIP energy charge is not planned to be changed over the planning period. So the total
monthly bill at the current rates $145.20 every two months --it would be going up to $155.22, so basically about
a $10.00 change every two months, or an overall increase of about 7%. And again, that's comprised of the
9t/2%, which is being proposed today for the standby charge and the consumption charges. The 3% on power
charge is just an illustration. That's what we pass through, as needed, or 7%, and then going to the next fiscal
year, again, another 9r/2%, a three and a zero, about an average of 7%. So roughly, these adjustments would
provide about a $10.00 per per two -month projection overall average of about 7%... overall customer bill impact.
And again, it's just an illustration. Customers using different water usage, their charges would vary, so this is
kind of a typical sample average general use customer profile. We included this slide just to provide maybe
some familiarity. This is a sample of what an actual customer bill looks like, and we just wanted to highlight
here, again, just sort of noting the bill shows the different components for the standby charge, consumption
charge, the power charge, and the energy charge and just reiterating that it's just the standby and consumption
charge piece we're talking about today that the proposal was for 91/2% adjustments for each of those two years.
And then the other components make up the total of what the customer bill is. Again, this just a sample
illustration, you know, and in case you're wondering how a customer might read his bill. Next, we looked at
kind of a comparison with what the other counties are charging in the area and how that configures to the
Department of Water Supply's current and proposed rates. So looking at the top on the bar chart, this is the
current rates, that typical bill of $145.20 and then the first proposal for 2023 would bring that bill up to $155.23,
and then that second 9�/z% adjustment would bring it up to $166,10. And then we compared it to Honolulu
Board of Water Supply, Kauai Department of Water, Maui Department of Water Supply, and then kind of
looking at the average. So you can see, you know, the different rates ... pretty much right, you know, everyone's
pretty close, you know, right in line. And again, we don't have information on what the other counties may be
doing over this same time period. We're just giving you an idea of that with these proposed rate adjustments,
you kind of stay within the range of what you've seen from the other counties with a couple of outliers of, you
know, Maui being on the lower side. And then this, where there a lot of numbers on this chart --this is just
presenting what the actual schedule of rates would be for the proposed rate adjustments for 2023-2024 for just
these that would apply, the 9 %2% rate adjustment, too, which is the standby and consumption charges. So again,
it just shows the column of your current rates as of now, Fiscal Year 2022, and what the actual rate structure
components would be for the standby charge and then the usage charge by your general use classes, your
Page 6 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
agriculture use, fire protection, standby charges, monthly standby charges, and then other standby charges. So
these are all the rates that would be applied to the proposed rate adjustments of 9'/2% per year.
A. HAJNOSZ: Okay, great. Thanks a lot, Karyn. So there are two more slides. So I thought it would be
helpful to give a little bit of additional perspective on where the rates have gone or where they've been. So in
2018, there was a 5% rate adjustment and then the following year, another 5%. In July 2020 was when we were
in the COVID... started the COVID so that was 0%. Eighteen months later, there was a 13% rate adjustment
implemented, and then six months later, there was no rate adjustment. And now the proposal is to implement a
9'/2% rate adjustment, again, on standby charges and consumption charges, and then in July of 2023, another
9'/z% on the standby charges and the consumption charges. And so that is where we end, at least the story
through 2023. What's going to come next, though, is going to be a deeper dive into the rate structure for the
Department of Water Supply. At the request of the Board and discussions with staff, they wanted us to take a
closer look at the topic of customer classes and the corresponding rate structures for those customer classes.
And so we are in the process, right now, of looking at different options for new rate structures that more closely
reflect how homogeneous groups of customers, like a single-family customer class, would use water and what
would be the appropriate rates for those customers. So that's what we're going to be looking at in the second
half of 2022. Early next year, 2023, we will be presenting these rate structure options to the Board and also to
the public. In the meantime, the second 9'/z% rate adjustment would go into effect, if it is approved by the
Board next month. Then in between, what we're going to be doing is what we call a true -up analysis and this is
really something that a lot of water utilities are taking into account more these days because the water utility
business, honestly, is becoming more and more complex. We have a lot of moving parts with regard to
regulations, with regard to climate change impacts, other impacts that are challenging the operational
sustainability, including workforce requirements, more regulations, aging infrastructure. A lot of things
happening and so it makes the projection of our operations, both revenues and expenses, a little more
challenging. So instead of just looking at a five-year rate proposal, what a lot of water utilities are doing is
looking at interim adjustments, like this true -up analysis, which is basically going to be used to take a look at
our projections and analysis in the middle of the rate proposal period to see, do we really need the next set of
rate adjustments and what should those levels be. So we're gonna do that in conjunction with the updated rate
structure options and then come back in the first part of 2024, report back on the true -up, adjust the rate structure
options, and go through a similar Board presentation, public hearing, for you all to approve or comment on the
proposed rates for the ensuing three years--2024, 2025, and 2026. And that would complete the five-year rate
cycle that we are right about start with. And, I think that is it. And with that, if there are any questions, we
would be happy to take them.
K. SUGAI: Any questions?
MANAGER -CHIEF ENGINEER: Doesn't appear to be any questions, Ann.
MS. HAJNOSZ: Oh, okay.
MANAGER -CHIEF ENGINEER: We were easy on you tonight. (laughter)
MS. HAJNOSZ: Alright well, we will see you tomorrow night, though, right?
MANAGER -CHIEF ENGINEER: Yes.
MS. HAJNOSH: Same time, different place.
MANAGER -CHIEF ENGINEER: Yeah, same time, different place. Thanks Ann. Thanks Karyn.
(Ms. Hajnosz and Ms. Johnson left the public hearing at 6:39 p.m.)
Page 7 of 8 May 24, 2022, Public Hearing on Proposed Water Rates
MANAGER -CHIEF ENGINEER: Okay, so, Mr. Sugai, you can go to the bottom part of Page 2.
K. SUGAI: Okay, so, the hearing is now open for public testimony. Is there anyone who wishes to testify at
this time? Doesn't look like it. This concludes our public hearing for the evening. Thank you very much.
(Public Hearing ended at 6:40 p.m.)
Recording Secretary
APPROVED BY WATER BOARD
JUNE 28, 2022
Page 8 of 8 May 24, 2022, Public Hearing on Proposed Water Rates