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Adjusted Sewer & Water Rates

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Why Did the Sewer & Water Rates Change?

Fees for service

The City owns and operates its own sewer and water enterprises. The City’s sewer and water rate structure is based on generating sufficient user fee revenue to cover all costs for operating each system. In short, operation, maintenance, and renewal of each system is entirely funded by the user fees for that system.

Study block

 

Prior to March 19, 2024, the City had not adjusted water rates since 2022 and had not adjusted sewer rates since 2020. This does not include the City’s Excess Usage Penalty Program, which was implemented in March 2022 as a response to the drought.

Costs for operating the City's utilities have increased in all categories, including personnel, maintenance and operations, and capital costs.  Significant inflationary cost increases have impacted both utilities, but rates had not been increased accordingly. The chart below illustrates U.S. annual inflationary growth from 2013 to 2023. As can be seen in the chart below, significant inflation occurred in 2021 and 2022.

 

Inflation Table

Given the increasing costs experienced in both utilities, in November 2022, the City Council approved a contract with NBS Government Finance Group (NBS), a public finance consulting firm with expertise in the areas of utility rates and finance, to assist in reviewing and updating rates. NBS conducted a comprehensive sewer rate study that would identify appropriate rates based on a full cost-of-service analysis. Since a comprehensive fee study was completed in 2017 for water, the City requested NBS to prepare water rate adjustments based on an applicable inflation factor to help keep up with escalating costs in the water utility. Both the comprehensive sewer fee study and proposed water rate adjustments were completed by NBS and those documents are available below.

Based on these analyses, the City's consultants recommended modest sewer and water rate adjustments.

As these rate adjustments were subject to the Proposition 218 process, below was a timeline of the steps that were taken to complete the process:

Step

Date

Adoption of the Resolution to Schedule the Public Hearing with the Presented Fees

January 16, 2024

Staff Conducts Additional Research and Prepares the Public Notice

January 17, 2024 – February 3, 2024

Notice of Public Hearing Issued a Minimum of 45 days in Advance of the Hearing Date

February 3, 2024

Public Hearing

March 19, 2024

Adoption by the City Council

March 19, 2024

 

 Key Takeaways:

  • The City owns and operates its own sewer and water enterprises, and costs for operation, maintenance, and renewal of each system is entirely funded by the user fees from that system.
  • The City had not increased water rates since 2022 and sewer rates hadn't been adjusted since 2020.
  • Significant inflationary cost increases have impacted both utilities, even though rates had not been increased accordingly.
  • Rate adjustments are necessary to keep up with the costs of providing service.

Discounts for senior, economically disadvantaged, or veteran customers are available. Please apply here. 

To view the Proposition 218 Notice of Public Hearing, click here.

Pursuant to California Senate Bill 323, there is a 120-day statute of limitations for challenging water and sewer rate increases.