SacSewer - 5/27/26

The May 27, 2026, meeting of the Sacramento Area Sewer District (SacSewer) focused on the completion of a major community infrastructure project, the presentation of the upcoming fiscal year budget, and strategic financial refinancing.   Community-Wide Septic to Sewer Program The Board received a final status update on a multi-year project to convert several disadvantaged communities from septic systems to public sewer service.

• Completion Milestones: The district successfully connected five communities—Freeport, Linda Manor, Old Thorntown, Hood, and Franklin—totaling 219 properties, including two mobile home parks and a school.
• Funding Success: The $54.8 million project was primarily funded by $48.2 million in external grants from the State Water Resources Control Board, the US EPA, and ARPA funds. This allowed the district to provide the service to residents without a financial burden on existing ratepayers.
• Community Recognition: Representatives from the State Water Board and Congresswoman Doris Matsui's office presented awards and recognition for the program's success in protecting regional groundwater and improving public health.

FY 2026-2027 Budget Workshop Staff presented the recommended budget for the upcoming fiscal year, which includes a combined operating budget of $372 million and a capital budget of $486.2 million.

• Labor Drivers: The budget includes a 3.3% Cost of Labor Adjustment (COLA) and a request for 21 new positions, bringing the total head count to 851.
• Chemical Costs: A significant driver of the 14.7% increase in services and supplies is a $10.6 million spike in chemical costs, specifically for chlorine/hypo, due to market volatility and local supplier exits.
• Reserves: The district maintains a healthy general reserve of 25% of operating costs.

Debt Refinancing and Financial Actions The Board approved the issuance of 2026 Bonds to refinance approximately $152.3 million in existing debt.

• Strategic Goals: The move is designed to eliminate "sequestration risk" associated with federal Build America Bonds and is expected to generate approximately $1 million in annual debt savings.
• Delinquencies: The Board set a public hearing for July 22, 2026, to address $16 million in delinquent sewer charges across approximately 20,800 accounts, which will be moved to property tax roles for collection.

Ordinance and Fee Updates The Board introduced a new unified "SacSewer Ordinance," merging the previously separate collection and treatment ordinances.

• Industrial Fee Changes: For the first time since 2007, industrial impact fees were updated, shifting from a flow-based model to an acreage-based model, which actually results in a net decrease in costs for new industrial customers.
• Biogas Incentives: New liquid waste hauler charges were introduced to incentivize the delivery of high-strength organic waste (such as brewery or dairy waste) to support the district's new biogas enhancement facility.

Workforce and Staffing (AB 2561) The district provided a mandated update on workforce status, noting that the overall vacancy rate improved from 13.28% in 2024 to 11.93% at the end of 2025.

• Engineering Challenges: The Professional Engineers Group (PEA) continues to have a high vacancy rate of 22.79%, though this is down from over 30% the previous year.
• New Leadership Positions: The Board approved new salary schedules for three key leadership roles—Controller, Finance Manager, and Internal Auditor—to reflect the increased complexity of the department following the district's transition away from county-provided services.