Crescent City staff urge passage of water and sewer rate proposals; June 1 Prop 218 hearing set

City staff on May 20 presented the results of separate Prop 218 rate studies for Crescent City's water and sewer utilities and said the studies support phased rate increases intended to restore reserves and fund near‑term capital work.

The case from staff: Staff said sewer operating costs and capital needs have grown since the last sewer rate increase in 2014 and that carrying out planned capital improvements — including collection‑system repairs and treatment plant upgrades — would rapidly deplete working capital if rates are not increased. “If we do complete the capital improvements that are slated, we run out of money basically before the end of next year,” staff said in the workshop presentation.

What the process looks like: Notices under the Prop 218 process were mailed in mid‑April. Staff said protests are counted by parcel and that a June 1 public hearing will be held to receive formal protests; staff explained a verification process is used if protests approach the threshold that would require further action.

Sewer specifics: Staff showed that operating expenses have roughly doubled since the last sewer increase, that Jacobs (the plant operator/contractor) provides critical operations and lab coverage, and that a larger grant‑funded project is being pursued to bundle several needed collection‑system repairs. Staff emphasized the treatment plant’s specialized staffing and the operational risk of deferring maintenance.

Water specifics: Staff clarified a commonly cited large “net position” number on the financial statements is an accounting value (assets), not liquid cash. Working capital for water is projected to decline if capital projects proceed; staff recommended a 90‑day operating reserve plus separate emergency and capital reserves. Proposed water rate changes last moved in 2017; the consultant recommends gradual increases to restore reserves.

Council and next steps: The council and staff discussed the protest counting procedure and timing. Staff said they are tracking protests and will report final counts at the June 1 hearing; if protest totals are uncertain the council may continue the hearing for a verification tally. The public hearing on rates is scheduled for June 1 and the first bills reflecting approved changes would issue after July 1 adjustments.