Title
Continued Public Hearings on Proposed FY 2019 Schedule of Revenues and Charges and FY 2019 & FY 2020 Biennial Budget Request
Body
Agenda of: June 20, 2018
Item No.: 2018-789
Amount: N/A
TO: The Honorable
Board of Directors
Great Lakes Water Authority
FROM: Sue F. McCormick
Chief Executive Officer
Great Lakes Water Authority
DATE: June 9, 2018
RE: Continued Public Hearings on Proposed FY 2019 Schedule of Revenues and Charges and FY 2019 & FY 2020 Biennial Budget Request
MOTION
Upon recommendation of Nicolette N. Bateson, Chief Financial Officer/Treasurer, the Board of Directors (Board) of the Great Lakes Water Authority (GLWA), re-opens and continues a Public Hearing on Proposed FY 2019 Schedule of Revenues and Charges and a Public Hearing on the FY 2019 & FY 2020 Biennial Budget Request held at a Meeting of the Great Lakes Water Authority Board on February 28, 2018, at 2 pm, in the Board Room, 735 Randolph, 5th Floor, Detroit, Michigan 48226; and authorizes the Chief Executive Officer to take such other action as may be necessary to accomplish the intent of this vote.
BACKGROUND
Both Michigan Law, MCL 141.434 and Section 7.02 of the GLWA Model Water Contract require a Public Hearing prior to adoption of the FY 2019 & FY 2020 Biennial Budget. Section 7.02 provides:
“Notification of Rates. As soon as possible in the ratemaking process, the Board shall provide information on proposed rates and the draft data and information used in the calculation of proposed rates in a format that will enable Customer to assist in the ratemaking process. Not less than thirty calendar days prior to the hearing required by Act 279, the Board shall provide Customer with written notice of a proposed rate and the underlying data used to calculate the rate. The Board shall meet with Customer to review the rate and the data.”
At its regularly scheduled February 28, 2018 meeting, The Board conducted a public hearing on the proposed FY 2019 Schedule of Revenues and Charges and a Public Hearing on the FY 2019 & FY 2020 Biennial Budget Request. These hearings were adjourned to be continued at the call of the chair at a future meeting of the Board prior to adoption of the budget.
JUSTIFICATION
Act 279 provides that a water or sewerage system which serves more than 40% of the population must hold at least one public hearing at least 120 days before a proposed rate increase is scheduled to take effect. The hearing(s) must be conducted in compliance with the Open Meetings Act (OMA). Notice of the time, date and place of each hearing must be in compliance with the OMA and must be mailed to each city, village or township served by the system not less than 30 days before each hearing.
Although Act 279 does not currently apply to GLWA operations, counsel has advised that GLWA should continue to abide by the notice requirements of Act 279 as the most faithful interpretation of the contract requirements. The continuation of the Board’s February 28, 2018 hearing is consistent with the Board’s direction during that meeting.
BUDGET IMPACT
Public Hearings on a Proposed FY 2019 Schedule of Charges and FY 2019 & FY 2020 Biennial Budget Request are necessary for the establishment of a current budget and schedule of charges effective July 1, 2018.
COMMITTEE REVIEW
The draft budget was presented to the Audit Committee on January 5, 2018 with subsequent discussions taking place before that Committee. In addition, the draft budget was presented to the entire GLWA Board on January 10, 2018. The proposed budget was reviewed with the proposed capital improvement plan summary, at the February 9, 2018 Audit Committee meeting and at the GLWA Board Meeting on February 14, 2018. Key factors influencing the proposed schedule of charges development were presented to the Audit Committee on January 19, 2018 and to the GLWA Board at its meeting on January 24, 2018.