The council this week voted 3-1 to continue the public hearing on proposed water and sewer rate increases to Aug. 11. The audience, which filled most of the seats in Council Chambers, applauded. The meeting was roughly two and a half hours long. Forty-four individuals were in the audience as of 6:57 p.m. The July 14 council meeting began at 7 p.m.
According to the city attorney, reopening the hearing meant the opportunity for the public to submit written protests would continue through the closing of the hearing on Aug. 11.
The mayor had closed the public hearing after receiving several comments from members of the public who opposed rate increases. However, District Four Councilwoman Patty Senecal moved to reopen the public hearing and continue the hearing to a later date. District Three Councilwoman/Mayor Lisa Landau seconded the motion.
District Five Councilman Nathan Steele cast the dissenting vote. District Two Councilman Ben Wong was absent that night.
“Our little city has been plagued by weak and spineless city councils for years. It takes courage to face a room of angry voters and do the right thing,” Steele wrote in a July 15 email.
“The problem is that there are 24,950 other residents counting on us to do the right thing,” Steele wrote.
“Water/Wastewater lost $1.75 million in 23/24 audited results. Water/Wastewater is losing $300,000 in lost revenues every single month,” Steele wrote. The figure Steele gave was the same figure that Steve Gagnon, of Raftelis, gave to the council before the hearing started.
“The system is running on bandaids and the bandaids are costing more and more with every repair. Council has a FIDUCIARY responsibility to the CITY, and not just the people in the room. It is the epitome of irresponsibility to delay the decision,” Steele wrote.
Protests to date below threshold
By state law, if 50% plus one of parcel owners submit written protests by the close of the hearing, the council cannot increase the rates.
On July 14, City Clerk Gloria Harper said the city received 297 written protests for water service from parcel owners. Harper said the city had 293 written protests for sewer service.
According to a July 10 email from Public Works Director Iris Lee the majority protest threshold for water rates would be 2,808. The majority protest threshold for sewer rates would be 2,539.
Earlier motion
Earlier in the evening, Landau read a letter from Wong requesting that the water and sewer rate hearing be postponed until July 28. “The proposed water & sewer rate adjustment is an important decision that will directly affect each resident of Seal Beach and deserves participation from a full 5-member Council,” Wong wrote.
“If the Council will make a motion and vote to accept the deferral, then we can reconvene to make a final decision together,” Wong wrote.
The public applauded when Landau finished reading the letter.
Wong wasn’t the only one calling for the meeting to be postponed to July 28.
Kenneth Seiff of College Park West emailed the city to ask the council to postpone the hearing until his representative (Wong) could be present.
During the public comment part of the meeting, Catherine Showalter, Hope Horning, and former council member Schelly Sustarsic also asked for the hearing to be postponed.
City Attorney Nicholas Ghirelli recommended opening the public hearing.
Senecal made a motion to postpone the hearing until Councilman Wong returned. However, that motion was defeated.
Public hearing
In their presentations to the council, Public Works Director Lee and consultant Steve Gagnon of Raftellis argued that the water and sewer utilities needed increased rates to cover costs, maintenance, improvement projects and debt service.
The 11 members of the public who spoke against the rate increases had different concerns.
The audience applauded after each comment.
One man suggested restructuring the city’s debt. One woman expressed concern about the city’s assumption of debt. Still another woman argued that the debt would not be paid off in five years.
Matthew Terry argued that Naval Weapons Station Seal Beach was not paying its fair share of Seal Beach’s water and sewer costs.
Charles Kluger suggested hiring consultants to look at the system. He called for an analysis of what needed to be done. Kluger wanted an analysis of the projected $300,000 a month cost of not increasing the rates.
Another resident said the ball was dropped long ago.
Hope Horning argued that water and sewer rates would subsidize salaries.
Theresa Miller said, “We’re headed toward bankruptcy if we go on the same path over the years.”
She said there was no way to evaluate if the money was being spent efficiently.
James Jensen said there was an accountability issue. He argued there was an accountability. “I thought it was about getting things fixed,” he said. Jensen said it was about showing lenders that the city got a pay increase so the city can justify those loans and get more loans. He accused the city of being disingenuous in the way the rate increases were presented to the public. He said the residents got a sales brochure in the mail basically saying rate adjustments. “It didn’t say rate increases,” he said.
Another member of the public asked for something on the city’s website so the public could follow the improvement projects.
Catherine Showalter said: “We have trust issues.”
“The funding has been allocated in the past for capital improvement projects that have not bbeen done. They’ve not been completed,” Showalter said.
“There have been no project status reports communicated clearly to the Seal Beach community, and no accountability for funds that were supposed to have been spent on infrastructure improvements,” Showalter said.
“I cannot personally afford the financial burden the increases will cause, and I have no confidence that more money in city coffers will solve, the problems clearly defined. Transparency and accountability requirements must be included in any adopted rate adjustment,” Showalter said.
Landau then closed the hearing. It was reopened later following the council vote.
Background
“Based on Raftelis’ detailed financial plan analysis, the February 2021 rate adjustments are no longer sufficient to balance the operating costs due to:
“1. Increased wholesale import and groundwater costs;
“2. Aging infrastructure and deferred maintenance;
“3. Overall inflationary impacts; and,
“4. On-going introduction of new legislation,” Lee wrote.
According to Lee’s report, both the sewer and water rates have been constructed in ways to correct structural deficits and finance operations as well as reserves.
“Water rates have two (2) components – 1) fixed charges; and 2) variable volumetric charges. Fixed charges are a function of meter size and are charges without respect to use. Volumetric charges are calculated based on the amount of water used multiplied by the rate per unit. The unit is measured in hundred cubic feet (HCF), which is approximately 748 gallons,” Lee wrote.
“Although the overall rate structure will not change, the amount of the fixed charge, which is based on meter size, is proposed to increase for the Leisure World community based upon a recent evaluation of its meter infrastructure. The City’s engineering consultant, AKM Consulting Engineers (AKM), conducted an independent evaluation of the meter size for the Leisure World community. In an opinion dated April 1, 2025, AKM concluded that the two (2), existing 12-inch service meters serving Leisure World are appropriately sized to account for the community’s “peak hour and maximum day demand plus fire flow.” Beginning with the City’s last rate update in 2021, Leisure World’s fixed rate charge was based on one (1), six-inch meter in accordance with an earlier analysis of Leisure World’s effective flow demand. However, AKM has provided a current and different analysis of the cost of providing service to the Leisure World community,” Lee wrote.
“Sewer Rates have two (2) components – 1) fixed charges; and 2) variable volumetric charges. Fixed charges are a function of customer classification and are charges without respect to use. The City does not measure wastewater flow, but instead estimates flows based on water use by applying a return-to-sewer factor (RTS) to non-residential water use. Volumetric charges, therefore, are calculated based on the amount of water used multiplied by the rate per unit,” Lee wrote.
