City Council

a.\nPROPOSITION 218 PROTEST HEARING - WATER RATE INCREASES\nSummary:\nThe 2023-2028 City of Signal Hill Strategic Plan identifies the update of the\nWater Master Plan (WMP) and Water Rate Study (RS) as key initiatives for\nFiscal Year (FY) 2024-2025. On December 12, 2023, the City Council executed\na professional services agreement and directed staff to complete the WMP and\nRS updates. The WMP provides a detailed assessment of the City’s water\nsystem, evaluates current and projected supply and demand, and outlines a\nfive-year capital improvement plan. The RS establishes a five-year tiered rate\nstructure to generate sufficient revenue for operations, capital projects, and debt\nservice.\nOver the past 18 months, staff has presented updates on the WMP and RS,\nincluding proposed rate adjustment options, during the Subcommittee meeting,\nmultiple City Council meetings, and community workshops. These efforts\nensured transparency and provided opportunities for public input and City\nCouncil feedback. On March 25, 2025, following the completion of the WMP and\nRS, receipt of public feedback, and a thorough review process, the City Council\ndirected staff to initiate a Proposition 218 Public Hearing process to consider the\nrecommended self-funded rate adjustment option, with the hearing scheduled\nfor May 27, 2025. The proposed new rate structure includes annual rate\nadjustments of 15% for Fiscal Years 2025-2026 and 2026-2027, 14% for Fiscal\nYears 2027-2028 and 2028-2029, and 10% in FY 2029-2030. Staff is requesting\nthat the City Council receive, file, and adopt the final Water Master Plan and\nreceive and file the Water Rate Study reports. The RS document has been\navailable for public review on the City’s website since April 3, 2025.\nIn addition, during tonight’s meeting, the City Council will conduct a Proposition\n218 Public Hearing to consider the proposed water rates and record property\nowner protests received during the 45-day protest period. The City will receive\noral comments, however, these will not be counted as formal protests unless\naccompanied by a written submission received prior to the close of the public\nhearing. After the hearing, the City Clerk will tabulate all valid written protests. If\nmore than 50 percent of the affected property owners or customers of record\nsubmit written protests, the City Council cannot adopt the proposed rate\nadjustments. If the City does not receive a majority protest, the City Council may\nproceed to adopt the proposed water rates. If the City Council adopts the new\nrates, they would take effect on July 1, 2025.\nStrategic Plan Goal(s):\nGoal No. 1\nFinancial Stability: Ensure the City’s long-term financial stability\nand resilience.\nGoal No. 4\nInfrastructure: Maintain and improve the City’s\ninfrastructure, water system, and recreational spaces.\nphysical\nGoal No. 5\nHigh-Functioning Government: Strengthen internal communication,\nrecruitment, retention, systems, and processes to increase the\neffectiveness and efficiency of City services.\nRecommendation:\n1.\nReceive, file, and adopt the Water Master Plan.\n2.\nReceive and file the Water Rate Study Report.\n3.\nConduct a Proposition 218 Public Hearing and\n4.\nIf a majority of the property owners or tenants of the identified parcels\naffected by the proposed rate increases do not submit written protests\nagainst the proposed rates, waive further reading and adopt a Resolution\nentitled:\nA RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SIGNAL HILL,\nCALIFORNIA, ESTABLISHING RATES FOR WATER SERVICE FEES AND\nTAKING OTHER ACTIONS RELATED THERETO