A proposal in Palo Alto to raise storm-drain fees and create a new structure for funding future improvements advanced this week, when the City Council formally approved a staff plan for a mail-only election.
If voters approve the change, the city would adopt a monthly fee of $13.65 for a typical home (known as an equivalent-residential unit), slightly higher than the existing fee of $13.03, which was approved by the voters in 2005 and is set to expire next year.
The new fee also comes with a new structure. Unlike today, the $13.65 fee would consist of a "base component" of $7.48 that would pay for on-going maintenance of the city's storm-drain system and would remain in perpetuity.
The remaining $6.17 would be a "projects and infrastructure component" that would pay for specific capital projects. Collectively, these fees are projected to generate about $6.9 million annually for the storm-drain program.
The council on Monday unanimously approved moving ahead with the mail-only election, a vote that was consistent with its prior support for raising the storm-drain fees. The only change between the new proposal and the one that was presented to the council in June is in the way the fee is split up.
Initially, staff and the specially appointed Storm Drain Blue Ribbon Committee recommended a more even split between the fee's operating and capital components (with $6.62 and $7.03 devoted toward each, respectively). Since then, the share going to the operating costs has gone up and the share going to capital has gone down, so that the operating component is now larger than the capital one.
Several council members, including Greg Schmid and Vice Mayor Greg Scharff said they were concerned about the recent tilt toward more spending on staffing and maintenance, which Schmid called a "fairly dramatic shift."
Public Works staff assured the council that the change was prompted by updated budget figures. The initial request was based on figures from the prior budget, said senior engineer Joe Teresi. The new ones reflect the current costs of ongoing maintenance, engineering and water-quality programs. Because the citizens committee didn't want to raise the overall fee, the recommendation was revised so that the capital component would be smaller.
"The phenomenon you identified comes from trying to keep the total as the same number," storm-drain committee member Hal Mickelson told the council.
Scharff wondered if the shift means that the city will no longer be able to fund all the capital projects that it had identified as part of the effort. These include upgrades near the Adobe Creek in the Palo Verde, Charleston Terrace and East Meadow Circle neighborhoods; improved drainage on Louis Road; and added capacity at several sections of Loma Verde Avenue, on Fabian Way and on Hamilton Avenue in the Duveneck/St. Francis neighborhood, among others.
Phil Bobel, assistant director of Public Works, also noted that because the city's projections for capital projects tend to be conservative, staff is hopeful that the dollars "will go just as far, if not further, than what we estimated."
After the explanation, the council swiftly approved the staff proposal
"This is obviously something we need to do and I think it's really important for the city to get it done," Scharff said of the proposed storm-drain improvements.
The city plans to send out legal notices about the fee changes in early September and hold protest hearing on the fees on Oct. 24. Assuming half of the city's customers don't protest, ballots will be mailed in January. If property owners approve the change, the new fees would take effect on June 1, 2017.