CITY COUNCIL REGULA MEETING AGENDA PACKET _Revised_ 6-2-26

Water Resources Economics Page 1 Technical Memorandum To: Siew-Chin Yeong, Director of Public Works – City of Pleasanton From: Nancy Phan, Principal Consultant – Water Resources Economics, LLC Date: May 14, 2026 Re: Proposed Sewer Rates & Connection Fees Technical Memo INTRODUCTION Water Resources Economics, LLC (WRE) was engaged by the City of Pleasanton (City) to conduct a sewer rate study to develop an updated multi-year schedule of sewer rates and one-time sewer connection fees. The purpose of the study is to evaluate the financial condition of the sewer enterprise, ensure long-term financial sustainability, establish rates that equitably recover the cost of providing service to all customer classes, and establish fees that equitably recover capital costs of providing system capacity to new users. City staff is seeking City Council input on the proposed sewer rate impacts and connection fees to complete the sewer rate study process. The results of this analysis are intended to support the development of a sewer rate and fee structure that is financially sufficient, cost-based, and consistent with the City’s policy objectives. The proposed sewer rates and fees have been developed with the following objectives: • Maintaining financial sufficiency to support ongoing operations and maintenance (O&M) and capital improvement program (CIP) needs to implement the Sewer System Management Plan (SSMP) • Stabilizing system condition over the five-year planning horizon (FY 2026 to FY 2030) • Aligning City collection rates with cost-of-service principles • Simplifying the rate structure to improve transparency and consistency with peer agencies • Updating connection fees to equitably recover costs imposed by new development PROPOSED SEWER RATES The proposed sewer rates are designed to generate the revenue required under the financial plan while reflecting the updated cost-of-service allocation and proposed modifications to the sewer rate structure as discussed during previous City Council meetings. The rates have been developed to ensure that the sewer enterprise remains financially sustainable over the study period. Proposed Sewer Rates Current FY 2027 FY 2028 FY 2029 FY 2030 Bi-Monthly Fixed Residential Charges Single Family $31.70 $57.03 $62.74 $69.02 $75.93 Single Family w/ 2nd Residence $48.28 $96.53 $106.19 $116.81 $128.50 Condo $21.77 $39.51 $43.47 $47.82 $52.61 Multi-Family $16.58 $39.51 $43.47 $47.82 $52.61 Attachment 2 Page 358 of 617