Rate increases are likely for thousands of Calaveras County Water District customers by the end of May, a spokesman for the utility said Tuesday.
Proposed rate increases are to cover operating costs only, and they will be the first rate increases for water and sewer customers since September 2014, when rates were increased to cover capital improvement costs. Joel Metzger, spokesman for CCWD, emphasized the last time rates were increased for operating costs was seven years ago in 2011.
Five elected directors for CCWD are scheduled to vote as a board March 28 on whether to send a Prop. 218 notice out to customers with the proposed increases for water and sewer rates, Metzger said. Calaveras County Water District serves about 13,000 water customers and 5,000 sewer customers.
The current base rate for water customers is $113.56 every two months, which includes 1,000 cubic feet of water, equivalent to 7,480 gallons, Metzger said.
Under the proposed rate increases over five consecutive years, the base water rate would drop the first year, 2018-19, to $112.28, and it would no longer include 1,000 cubic feet of water. The district rate for 100 cubic feet of water will also drop from $1.44 to $1.09.
The base water rate goes up to $114.23 in 2019-20, to $116.22 in 2020-21, to $118.26 in 2021-22, and to $120.35 in 2022-23.
Current sewer rates start at $172.32 every two months, Metzger said. Proposed increases would boost that to $179.91 in 2018-19, to $187.23 in 2019-20, to $194.78 in 2020-21, to $202.58 in 2021-22, and to $210.63 in 2022-23.
The district’s operating expenses have increased over the past seven years, Metzger said, and water sales decreased during state-mandated conservation measures during the drought.
“Up to 40 percent less water was used and the district lost up to $700,000 a year during the drought, the end of 2014, all of 2015, and into 2016,” Metzger said in a phone interview. “The scary thing is when people make choices like taking their lawns out and replacing them with wood chips and gravel and drought tolerant landscaping. When they make those choices their water demand never returns to pre-drought levels. We call that demand hardening.”
The district may never see water consumption reach pre-drought levels again, unless they get more customers, Metzger said. Even though the district and other agencies have come out of the drought for now, CCWD is still selling less water due to conservation. That's the single biggest revenue loss that's causing budget deficits.
According to a financial analysis over the past year, performed by a third-party outside consultant called HDR, the projected budget deficit for 2018-19 is $716,000 on the water side, and the deficit on the sewer side for the same period is $684,000, Metzger said.
Those deficit numbers do not include the proposed rate increases. Nor do they include internal cuts identified by district staff that have since reduced deficit numbers by 20 percent, Metzger said.
“We've also seen an increase in electricity costs, one of the biggest line items on our budget, due to the need to power water and sewer pumps,” Metzger said. “It's a huge expense. That alone is north a million dollars a year, and rising.”
The current CCWD annual operating budget is $15,717,142, Metzger said.
Before district staff made a proposal to the CCWD board for a rate increase, Metzger emphasized, staff looked inward and made internal cuts to reduce projected water and sewer deficits by 20 percent.
If the CCWD board votes to send a Prop. 218 notice of new rate increases to customers March 28, there will be a 45-day period for public education with town hall meetings to explain why the increases are needed, Metzger said. Final board approval for the increases could take place, tentatively, in mid to late May.
The board of directors for CCWD are Scott Ratterman, Russ Thomas, Terry Strange, Bertha Underhill and Jeff Davidson. Their next regular meeting is scheduled to start at 1 p.m. March 28 at 120 Toma Court, San Andreas.
Contact Guy McCarthy at firstname.lastname@example.org or 588-4585. Follow him on Twitter at @GuyMcCarthy.