Topic: Water Rates

Overview

Water Rates

Typically, water utilities’ budgets are funded by revenue collected through water and sewer rates. Revenue generated by rates covers the costs of operations, as well as ongoing upgrades and repairs to pipelines, treatment plants, sewers and other water infrastructure.

State legislation also has affected the water rate-setting process by requiring new processes for altering water rates, as well as by requiring water conservation, which in turn decreases the demand for water.

Aquafornia news Los Angeles Times

Why Los Angeles can’t afford to go third on clean energy

“Utilities race to be second. And sometimes it’s better to be third.” So said Fred Pickel, the Los Angeles Department of Water and Power’s in-house ratepayer advocate, at a DWP board meeting in December 2019, a few months before the pandemic brought everyday life to a screeching halt. He was discussing the city’s first-of-its-kind plan to convert a coal plant to green hydrogen — a key piece of L.A.’s plans to reach 100% clean energy by 2035. Pickel was intrigued. But he was also concerned that the coal-to-hydrogen conversion would be expensive, driving up electric bills for DWP customers. Five years later, he’s singing the same song. … Pickel now recommends that the city delay its 100% clean energy goal beyond the 2035 target established by former Mayor Eric Garcetti and supported by current Mayor Karen Bass, and endorsed by the City Council. 

Aquafornia news Stanford Report

New study: A new approach to the growing problem of water affordability

Rising water prices are forcing many households in the United States to choose between rationing water or risking shutoff by leaving bills unpaid. A new study in Environmental Research Letters shows government agencies and water utilities may be underestimating the true number of households at risk of losing affordable access to basic water service – and offers a solution. … Accurate assessments of water affordability are important because they inform decisions about utility rates, assistance programs, and eligibility for government financing for infrastructure improvements. 

Aquafornia news The Coast News Group

Carlsbad rejects prepaying fixed charges to county water authority

Despite rising water rates, the city of Carlsbad has opted against prepaying fixed charges to the county’s wholesale water supplier in exchange for discounted rates in 2025. In late May, the San Diego County Water Authority asked its 23 member agencies, including the Carlsbad Municipal Water District, to consider a prepayment option.  On June 27, the San Diego County Water Authority board approved a 4% increase in wholesale water rights. While that number is far less than the 15% to 18% increase that was previously projected, the water authority plans to consider additional charges to support its maintenance and operations and financial stability later this month during a public hearing scheduled for July 25.

Aquafornia news Courthouse News Service

Tuesday Top of the Scroll: California Supreme Court reverses Public Utilities Commission on water surcharges

The California Supreme Court on Monday reversed the state’s Public Utilities Commission’s 2020 order that stopped water companies from using certain surcharges when their revenue falls short because of conservation efforts. The court agreed with a group of water companies that the commission hadn’t clearly informed them that it would consider eliminating the so-called decoupling mechanisms — initially prompted by years of drought and the need to conserve water — in the scoping memos for the yearslong rulemaking proceedings that culminated in the 2020 order. The scoping memos identify what possible rule changes the commission will be considering, and they give the utilities an opportunity to prepare their arguments and evidence to address them. In this case, the court said, the memos only referred to how to improve water sales forecasting, not to eliminating the decoupling mechanisms.

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Aquafornia news San Francisco Chronicle

Opinion: SF residents: Brace yourselves for skyrocketing water and sewer rates

San Franciscans: Brace yourselves for skyrocketing utility rates. Combined water and sewer bills will increase by 8% annually, tripling over the next 20 years. Hetch Hetchy customers outside of San Francisco will get hit hard, too, and the situation is likely to get much worse. The current rate crisis is the result of decades of deferred maintenance, and the failure to recognize and adapt to changing water use patterns. Over many years, utility revenues were used to subsidize general city services rather than to maintain and upgrade the Hetch Hetchy Water System and wastewater infrastructure. At the same time, per capita water use declined and population growth slowed, reducing revenues. The San Francisco Public Utilities Commission is now playing catch-up on a massive infrastructure backlog.
—written by Peter Drekmeier, policy director for the Tuolumne River Trust and former mayor of Palo Alto

Aquafornia news San Diego Union-Tribune

San Diego County water rates look poised to go up — but not as steeply as feared. That could create its own problems.

Local water bills might not be going up quite as sharply next year as expected. The [San Diego] County Water Authority’s board tentatively shrank a proposed rate hike for wholesale water from 18 percent to 14 percent on Thursday — despite concerns the move could hurt the water authority’s credit rating. An increase in wholesale rates will force nearly every local water agency to pass on the extra costs to its customers, but just how much gets passed on could vary widely. Some agencies buy less wholesale water than others, especially those with groundwater basin storage or other local water supplies. The board delayed a final vote on the proposed 2025 increase to its July 25 meeting, but a coalition led by the city of San Diego had enough support Thursday to reduce the increase to 14 percent. It would be part of a three-year set of rate hikes that would cumulatively raise rates by more than 40 percent when compounded — if the board also follows through on a 16.4 percent increase in 2026 and a 5.7 percent increase in 2027.

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Aquafornia news Voice of San Diego

San Diego’s water prices face doomsday increase

Thursday [June 27] is doomsday for water prices in San Diego. That’s when the region’s water importer – the San Diego County Water Authority – debates whether to boost its prices a whopping 18 percent come Jan. 1. The price increase is massive compared to previous rate increases, and the Water Authority’s biggest customer, the city of San Diego, is pretty ticked off. … San Diego Mayor Todd Gloria directed his powerful contingent of 10 water board members to fight the increase. We won’t know how hard they’ll fight until the full 33-member board meets Thursday afternoon to vote on it. Gloria’s administration is building a water recycling project, which costs billions of dollars. Once its built, in 2035, San Diego won’t buy as much water from the Water Authority. But for now, San Diegans are saddled with the cost of building water recycling and purchasing expensive water from outside city boundaries.

Aquafornia news San Diego Union-Tribune

Ramona water district’s higher water rates to show on August bills

Ramona Municipal Water District directors approved water rate increases for customers starting July 1 and will decide whether to continue raising rates each year through fiscal year 2028-29. The rate increase was approved at the water district’s June 11 meeting by a 4-1 vote with Director Gary Hurst opposed. The new rates for the 2024-25 fiscal year are based on volume of water used, monthly service charges and water pumping costs, according to a staff report. The average water bill will increase from roughly $129 per month to $142, an increase of about $13.68, said the water district’s Chief Financial Officer Joe Spence. But the actual charges on a water bill will vary depending on the volume of water used each month and the size of the customers’ water meter.

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Aquafornia news Voice of San Diego

Commentary: San Diego provoked a budget battle at MWD that helped take down its GM

The letter that brought down Adel Hagekhalil, the general manager of the Metropolitan Water District, is getting buried by the news it generated. Politico first revealed … claims of dysfunctional management and harassment led the Metropolitan Board of Directors to place Hagekhalil on administrative leave and appoint an interim general manager. Hagekhalil is probably done. Environmentalists are worried Metropolitan’s establishment is forcing him out for siding with them. But the letter itself hinted at a major disagreement between its author, Metropolitan’s chief financial officer, and San Diego representatives on the Metropolitan board. And that disagreement could have been part of what provoked the CFO to write the letter and thus led to Hagekhalil’s downfall.  

Aquafornia news Orange County Register

Commentary: Democrats vs. democracy

… Gov. Gavin Newsom and legislative leaders are trying to assassinate three initiatives that the people of California put on the ballot using the powers of direct democracy. They are attacking two initiatives that are set to be on this November’s ballot, and one that was long ago approved by voters and now is being hollowed out. That initiative is Proposition 218 from 1996. It amended the state constitution to put some limits and controls on property-related fees and charges. For example, public agencies planning a new or increased “assessment,” such as higher rates for water service, have to comply with certain procedures. 
-Written by columnist Susan Shelley. 

Aquafornia news Daily Breeze

Struggling Angelenos get $253M in relief to pay late DWP and garbage bills

Some $253 million helped Angelenos pay back utility bills from March 2020 through December 2022, city officials announced on Wednesday, June 12. Los Angeles Mayor Karen Bass, Councilmember Heather Hutt, state Environmental Protection Agency Secretary Yana Garcia, Water Resources Control Board Chair Joaquin Esquivel, and officials with the Los Angeles Department of Water and Power and L.A. Environment and Sanitation celebrated the distribution of federal funding at a news conference. Officials said the aid was automatically applied to about 204,500 DWP customer accounts. The California Water and Wastewater Arrearage Payment Program was the source of the funds, administered by the state water board using federal American Rescue Plan Act funds.

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Pandemic Lockdown Exposes the Vulnerability Some Californians Face Keeping Up With Water Bills
WESTERN WATER IN-DEPTH: Growing mountain of water bills spotlights affordability and hurdles to implementing a statewide assistance program

Single-family residential customers who are behind on their water bills in San Diego County's Helix Water District can get a one-time credit on their bill through a rate assistance program funded with money from surplus land sales.As California slowly emerges from the depths of the COVID-19 pandemic, one remnant left behind by the statewide lockdown offers a sobering reminder of the economic challenges still ahead for millions of the state’s residents and the water agencies that serve them – a mountain of water debt.

Water affordability concerns, long an issue in a state where millions of people struggle to make ends meet, jumped into overdrive last year as the pandemic wrenched the economy. Jobs were lost and household finances were upended. Even with federal stimulus aid and unemployment checks, bills fell by the wayside.

Western Water California Groundwater Map Layperson's Guide to Groundwater Gary Pitzer

With Sustainability Plans Filed, Groundwater Agencies Now Must Figure Out How To Pay For Them
WESTERN WATER NOTEBOOK: California's Prop. 218 taxpayer law and local politics could complicate efforts to finance groundwater improvement projects

A groundwater monitoring well in Colusa County, north of Sacramento. The bill is coming due, literally, to protect and restore groundwater in California.

Local agencies in the most depleted groundwater basins in California spent months putting together plans to show how they will achieve balance in about 20 years.

Western Water Gary Pitzer

California Officials Draft a $600M Plan To Help Low-Income Households Absorb Rising Water Bills
WESTERN WATER NOTEBOOK: State Water Board report proposes new taxes on personal and business income or fees on bottled water and booze to fund rate relief program

Filling a glass with clean water from the kitchen tap.Low-income Californians can get help with their phone bills, their natural gas bills and their electric bills. But there’s only limited help available when it comes to water bills.

That could change if the recommendations of a new report are implemented into law. Drafted by the State Water Resources Control Board, the report outlines the possible components of a program to assist low-income households facing rising water bills.

Western Water California Water Map Layperson's Guide to the State Water Project Gary Pitzer

As He Steps Aside, Tim Quinn Talks About ‘Adversarialists,’ Collaboration and Hope For Solving the State’s Tough Water Issues
WESTERN WATER Q&A: Tim Quinn, retiring executive director of Association of California Water Agencies

ACWA Executive Director Tim Quinn  with a report produced by Association of California Water Agencies on  sustainable groundwater management.  (Source:  Association of California Water Agencies)In the universe of California water, Tim Quinn is a professor emeritus. Quinn has seen — and been a key player in — a lot of major California water issues since he began his water career 40 years ago as a young economist with the Rand Corporation, then later as deputy general manager with the Metropolitan Water District of Southern California, and finally as executive director of the Association of California Water Agencies. In December, the 66-year-old will retire from ACWA.

Western Water Gary Pitzer

Drought’s Impact on Fiscal Planning Highlights PPIC Report
Suppliers need “proactive” drought pricing to prevent cash crunch

During drought, people conserve water. That’s a good thing for public water agencies and the state as a whole but the reduction in use ultimately means less money flowing into the budgets of those very agencies that need funds to treat water to drinkable standards, maintain a distribution system, and build a more drought-proof supply.

“There are two things that can’t happen to a water utility – you can’t run out of money and you can’t run out of water,” said Tom Esqueda, public utilities director for the city of Fresno. He was a panelist at a June 16 discussion in Sacramento about drought resiliency sponsored by the Public Policy Institute of California (PPIC).

Western Water Magazine

Ante Up: Funding California’s Water
May/June 2014

This printed issue of Western Water looks at how water use is paid for and the push to make public financing more flexible.

Western Water Magazine

Are We Keeping Up With Water Infrastructure Needs?
January/February 2012

This printed issue of Western Water examines water infrastructure – its costs and the quest to augment traditional brick-and-mortar facilities with sleeker, “green” features.

Western Water Magazine

Dollars and Sense: How We Pay for Water
September/October 2009

This printed issue of Western Water examines the financing of water infrastructure, both at the local level and from the statewide perspective, and some of the factors that influence how people receive their water, the price they pay for it and how much they might have to pay in the future.

Western Water Magazine

Changing the Status Quo: The 2009 Water Package
January/February 2010

This printed issue of Western Water looks at some of the pieces of the 2009 water legislation, including the Delta Stewardship Council, the new requirements for groundwater monitoring and the proposed water bond.

Western Water Magazine

A ‘New Direction’ for Water Decisions? The California Water Plan
May/June 2010

This printed issue of Western Water examines the changed nature of the California Water Plan, some aspects of the 2009 update (including the recommendation for a water finance plan) and the reaction by certain stakeholders.

Western Water Magazine

Small Water Systems, Big Challenges
May/June 2008

This printed copy of Western Water examines the challenges facing small water systems, including drought preparedness, limited operating expenses and the hurdles of complying with costlier regulations. Much of the article is based on presentations at the November 2007 Small Systems Conference sponsored by the Water Education Foundation and the California Department of Water Resources.

Western Water Magazine

Viewing Water with a Wide Angle Lens: A Roundtable Discussion
January/February 2013

This printed issue of Western Water features a roundtable discussion with Anthony Saracino, a water resources consultant; Martha Davis, executive manager of policy development with the Inland Empire Utilities Agency and senior policy advisor to the Delta Stewardship Council; Stuart Leavenworth, editorial page editor of The Sacramento Bee and Ellen Hanak, co-director of research and senior fellow at the Public Policy Institute of California.

Video

Drinking Water: Quenching the Public Thirst (60-minute DVD)

Many Californians don’t realize that when they turn on the faucet, the water that flows out could come from a source close to home or one hundreds of miles away. Most people take their water for granted; not thinking about the elaborate systems and testing that go into delivering clean, plentiful water to households throughout the state. Where drinking water comes from, how it’s treated, and what people can do to protect its quality are highlighted in this 2007 PBS documentary narrated by actress Wendie Malick. 

Video

Drinking Water: Quenching the Public Thirst (30-minute DVD)

A 30-minute version of the 2007 PBS documentary Drinking Water: Quenching the Public Thirst. This DVD is ideal for showing at community forums and speaking engagements to help the public understand the complex issues surrounding the elaborate systems and testing that go into delivering clean, plentiful water to households throughout the state.

Western Water Excerpt Gary PitzerRita Schmidt Sudman

Dollars and Sense: How We Pay For Water
September/October 2009

It’s no secret that providing water in a state with the size and climate of California costs money. The gamut of water-related infrastructure – from reservoirs like Lake Oroville to the pumps and pipes that deliver water to homes, businesses and farms – incurs initial and ongoing expenses. Throw in a new spate of possible mega-projects, such as those designed to rescue the ailing Sacramento-San Joaquin Delta, and the dollar amount grows exponen­tially to billion-dollar amounts that rival the entire gross national product of a small country.