By Eric Heinz
Water base rates are going to increase and a new rate system for usage will be in place by the new year, which will replace the city’s current tiered rate system.
The City Council voted 3-0-2, with Council members Chris Hamm and Steve Swartz absent, to enact the measures by Jan. 1.
The new rates have been formed to make up the difference the city lost in its reduced water usage—which was mandated by the state in 2015 and 2016. Because less water was used, revenue decreased and the city’s enterprise fund was forecasted to not be able to sustain itself.
Instead, a consumer price index estimation has been added to the base rates.
In 2016, the city contracted with Carollo Engineers to study the current water rate system.
People who spoke during the meeting had concerns related to the costs that could result in their monthly rent being raised, what home owners associations that look after open space and larger parcels of land will have to pay for non-potable water and that the rates would exceed the city’s cost of service. Enterprise funds cannot make a profit and must show cost of service, according to California’s water laws and Prop 218.
The Cost-of-Service Study recommended a total increase of 12 percent in revenue, city officials said.
“The Cost-of-Service Study recommended a total increase of 12 percent in revenue to the Water Fund to accurately capture all operating costs and comply with the City’s Fiscal Policy,” Erik Sund, assistant city manager, stated in an email on Nov. 8. The total revenue of “$997,000 is required to collect from all customer classes during Fiscal Year 2017-18 to support the water system.”
Sund said the five-year water rate plan related to revenue and projected increases can be found on refer to page 20 of the Cost of Service Study.
“The actual percentage increase borne at the individual customer level varies and is dependent on the meter size, which is a fixed cost (pg. 29 of the Cost of Service Study), and the water consumption of the account,” Sund stated. “As an example, the increase to the residential customers’ total water bill will range from $2 to $13 per month depending upon water use. The average residential customer using 9 units of water will see the highest increase of $13.02 per month or a 30 percent increase.”
Representatives from Carollo Engineers said during the meeting that some of the rates are related to “demand service,” which would be enforced if the demand of water does not meet what is already a fledgling revenue to pay for water services, maintenance and other needs. Those costs will be based on a variable of how much the state could require in water use reductions.
A chart from the water study conducted by Carollo showed figures that if the city continued on its current tiered rates, the costs to residents and commercial accounts during high-usage months would be more than if the city changed to the new rates.
A majority protest of 50 percent of property owners in the city would have been needed to stop the new rate from taking place. The city received nowhere near that many protests.
A webpage to the information about the city’s upcoming water rates can be found here: http://san-clemente.org/department-services/water-services/water-billing/water-rates
Video from the city of San Clemente website on water rates
This article has been updated to include comments from the Assistant City Manager. A shorter version of this article appeared on Page 3 in the Nov. 9-15 edition of the San Clemente Times.