SR - RES-11022 - UPDATE RATES COLLECTED FOR SANITATION CHARGES ON PROPERTY TAX ROLLS1. SUBJECT
Resolution No. 11022 — A Resolution of the City Council of the City of Orange Updating the
Rates Collected for Sanitation Charges on the Property Tax Rolls.
2. SUMMARY
In July 2013, the City Council adopted Resolution No. 10725 to allow for the collection of
sanitation charges from customers that do not have water service through the City. This
resolution allowed for the collection of sanitation charges consistent with the charges in effect at
that time. In June 2017, the City Council adopted new sanitation rates. In order to charge these
new rates through the property tax roll, an updated resolution is necessary to reflect the new
rates.
13. RECOMMENDED ACTION
Adopt Resolution No. 11022 which allows for the continued placement of sanitation charges for
682 sanitation -only customers.
1 4. FISCAL IMPACT
Adoption of the resolution will allow for the continued savings of approximately $4,000 per year
in staff, printing, postage expenses, and reduced bad debt expense.
5. STRATEGIC PLAN GO
2a. Be a fiscally healthy community — Effectively manage and develop City assets.
16. GENERAL PLAN IMPLEMENTATION
Not applicable.
7. DISCUSSION and BACKGROUND
In July 2013, the City Council adopted Resolution No. 10725, which approved the placement of
682 customer accounts on the tax rolls. This change was made because CR &R took over billing
for trash, which left these customers as sanitation -only accounts. These customers receive water
service from other agencies. Unlike water customers, sanitation -only customers cannot be
shutoff for non - payment. As such, collections became more difficult because the City had little
recourse for collections. By putting these charges on the property tax rolls, collection rates
increased significantly. As part of the adoption of Resolution No. 10725, the City was required
to notify all customers affected by this change. This step is only required when the charges are
first added to the property tax bills.
In June 2017, the City Council adopted new sanitation rates. Resolution No. 10725 only allowed
for the rates that were in effect at the time it was adopted. With the new sanitation rates going
into effect September 1, 2017, Resolution No. 10725 is no longer valid. Resolution No. 11022
will allow for the updated rates to be charged to these sanitation -only customers. Since the
property tax bills cover the entirety of Fiscal Year 2017 -18, staff has pro -rated the bills for this
year. Two months will be charged at the old rates and ten months will be charged at the new
rates. The resolution includes updated tax roll rates for each customer for each of the annual
increases contemplated in new rate schedule.
8. ATTACHMENTS
Resolution No. 11022
RESOLUTION NO. 11022
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF ORANGE UPDATING THE RATES COLLECTED FOR
SANITATION CHARGES ON THE PROPERTY TAX
ROLLS.
WHEREAS, the City of Orange Finance Department previously billed for residential trash
service; and
WHEREAS, the billing for residential trash service was taken over by the City's trash
contractor CR &R in 2013; and
WHEREAS, because of this, the City was billing approximately 640 accounts solely for
the sanitation charge, which charge included sewer, street sweeping, tree trimming, and storm
water charges and 42 accounts solely for sewer; and
WHEREAS, the City Council adopted Resolution No. 10725 and the City properly noticed
customers in compliance with Health and Safety Code section 5473 and Government Code section
6066 to allow for such charges to be collected in the same manner and at the same time as property
taxes; and
WHEREAS, Resolution No. 10725 only allowed for the placing of sanitation charges at
rates in effect at the time of its adoption; and
WHEREAS, the City Council, in June 2017, adopted Ordinance No. 04 -17 which provides
for multi -year increases to the City's sanitation charges.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Orange hereby
resolves as follows:
1. Resolution No. 10725 is hereby repealed.
2. That the sanitation charges, as set forth in the attached Exhibit "A ", which is incorporated
herein by this reference, be placed on the Orange County Property Tax Roll for the Fiscal
Years 2017 -2018 through 2021 -2022, and all subsequent fiscal years and that such charges
be collected in the same manner and the same time as the property tax, and that a copy of
this Resolution, along with Exhibit "A ", be forwarded to the Auditor - Controller of the
County of Orange.
3. That this Resolution shall remain in effect until repealed or until a change is made in the
rates charged by the City.