Municipal, Industrial, and Landscape Irrigation
1) Rate Structure Changes
Your water bill is determined based on what it costs to serve water to your home or business. Due to state requirements, the changing water use trends driven by the recent drought, and our fiscal responsibility, we need to reassess our rate structure.
- We worked with an independent consultant to ensure proper allocation of costs among customers and develop the Final Administrative Record for Rate Structure Analysis (PDF). Our proposed rate structure changes align water rates with the cost of your water service, nothing more.
- These structural changes only affect how rates and charges are allocated among customers; they do not result in additional funds for the District overall.
- With the rate structure changes, some customers’ bills will go down, while others will go up depending on their service.
NOTABLE CHANGES UNDER THE RATE STRUCTURE
The untreated water rates have been standardized to increase ease of understanding and administration.
Demand Charge – The demand charge represents the cost of delivering water to customers under peak demand conditions. The previous demand charge was assessed by gallons per minute based on maximum day, maximum hour, or maximum month factors, differing by each customer class. The demand charge is now the same rate for all metered customers. The demand charge is assessed by thousand gallons based on maximum month of usage in each of the three past years, averaged. The 2019 rates will be based on the averages from FY16, FY17 and FY18 (July 1, 2015 through June 30, 2018). A three-year average is utilized to provide a stable basis that does not drastically change due to annual fluctuations in demand. A historical average also takes into consideration the most recent capacity requirements for each customer and is an industry standard methodology to recover capacity-related costs.
Elimination of the Excess Use Charge – Due to changes in state law, we must remove the excess use charge, which increased the rate for landscape irrigation customers who exceeded their budgeted water allocation.
2) Annual Rate Adjustment
Water rates pay for the transport and delivery of safe, high-quality, and reliable water to all District customers. Based on our annual review conducted with the rate structure evaluation, our Board approved a rate adjustment 2019 Rate Review Public Hearing and Adoption (PDF) to generate a 6% revenue increase for 2019 to maintain your water service.
These adjustments are necessary to:
- Meet the increasing costs of operating and maintaining the system as well as treating and delivering water
- Continue repairing and replacing aging pipes and other facilities
- Account for new state mandates
- Fund employee salaries and benefits
- Rebuild financial reserves for the next drought
Putting It All Together: 2018 Rates Compared to 2019 Rates
Under the previous rates, an untreated landscape irrigation water customer who used 5,000 gallons of water per day paid about $381.47 per month for their water service. With both the rate structure changes and the annual rate adjustment, the monthly cost would change to $404.18. This would result in an increase of $22.71 per monthly billing cycle for the next year.
Impacts to Customers with Larger Water Usage
An untreated water industrial customer who used 300,000 gallons of water per day (9 million gallons per month) and a maximum monthly usage of 13 million gallons previously paid approximately $21,409 per month for their water service. With both the rate structure changes and annual rate adjustment, the monthly cost would change to approximately $22,688, an increase of $1,279 (6.0%) per monthly billing cycle.