The Tuolumne Utilities District is considering a project to replace thousands of underperforming water meters that would cost an estimated $4 million.

New, automated meters could generate $410,000 in revenue each year by providing more accurate readings, freeing up money budgeted each year for meter replacement and eliminating one full-time meter reader position, according to TUD staff.

"This is a project where you actually have a return on investment and generate some revenue," said TUD General Manager Pete Kampa.

About 7,840 mechanical meters are old and under-reading water usage, Kampa said. The district has about 13,300 active commercial and residential treated-water accounts in its system, with about 5,470 already hooked up to automated meters.

Old meters are costlier and more time-consuming to read. Currently, one TUD employee is able to read about 30 of the mechanical meters per day. They would be able to read all of the roughly 13,300 meters in just about two days if they were all automated.

The new meters capture water use data and can transmit the information to a portable device up to three miles away, which is then recorded for billing purposes and consumption analysis.

The new technology in the automated meters also allows TUD to look at the actual numbers for daily, and even hourly, consumption to monitor water leaks or resolve a dispute over a bill, among other potential uses.

Since 2004, the district has replaced all of its meters in the communities of Cedar Ridge, Sugarpine, Monte Grande Heights, Big Hill and Tuolumne. Kampa said most of the remaining old meters are located in Sonora, while the rest are scattered throughout the county.

The district used the meter replacements in Tuolumne for a pilot study to calculate the effect on accuracy. That study showed these new meters had improved accuracy about 10 percent in one billing cycle.

The average customer's monthly water bill also increased about $4, according to District Engineer Tom Scesa, but Kampa ensured this was only due to more accurate readings.

"As these meters are in the ground for a long time, they start to under-register the water that's used," Kampa said. "I've never heard of a meter over-registering."

Water Committee member John Maciel, who also serves on the TUD board, was concerned about funding for the project, especially given the many hurdles facing the district because of "decaying" infrastructure.

"It's a $400,000 budgeted item each year if we do this," Maciel said.

Scesa suggested financing the project with a long-term loan and paying it down using the additional revenue generated by the new meters. He said the district also could choose to seek grant funding.

Finance Director Steve Sheffield called estimates "conservative" and said he thought the project fit with the overall goals of the TUD board, one of which is to improve the district's infrastructure.

"I think we should support this for the board to approve," said TUD Board of Directors and Water Committee member Delbert Rotelli.

The committee approved the project to go before the board at a meeting on either Oct. 22 or Nov. 12, where TUD staff will recommend moving forward with contractor interviews and negotiations.