Water rate hike OK’d in Carlsbad

CARLSBAD — It is official, water rates will increase for one year as approved by the Board of Directors of the Carlsbad Municipal Water District, via the City Council, on Tuesday.

The new rate structure, as presented by Senior Accountant Aaron Beanan, was developed by Carollo Engineers, Inc. Wastewater rates rises by 5.25 percent and potable water increases by 5.25 percent.

The new rate structure is effective Jan. 1.

Single-family residential will be a flat monthly charge, second dwelling units are 50 percent of single-family charge, multi-family based on percent of water usage, commercial based on 95 percent usage, schools based on enrollment, large volume based on 95 percent usage and Industrial Pretreatment Class III based on 95 percent usage.

The increases are as follows: single-family, 6.84 percent ($1.78) to $27.81; multi-family is 9.67 percent ($0.29); second dwelling units at 50 percent ($13.91); commercial is just under 11 percent ($0.50) and schools rise four percent ($0.08).

The IPC III will be charged $4.53 to recover costs associated with the desalination plant. The large volume classification, meanwhile, was removed as no businesses or industry currently exists in Carlsbad.

“Even though cost are increasing, it still costs less than three-quarters of a cent for potable drinking water,” Beanan said.

The city’s increase is driven by a 5.4 percent raise from the San Diego County Water Authority’s all-in rate for treated water. In addition, the charge covers a portion of costs associated with the desalination plant and the Imperial Irrigation District transfer to recognize supply reliability.

In addition, the city will use $1.5 million of its water reserve account to mitigate further increases, Beanan said. If the city had not tapped the reserve fund, rates would have increased about 16 percent.

“A targeted 40 percent operating reserve, better than anticipated financial results, incorporating the estimated impacts of the uniform contact into the rate model back in 2013 and rate smoothing have tempered the rate increase,” Beanan said.

Even with the rise in rates, Carlsbad is still one of the cheapest entities in San Diego County. According to research by Beanan including all proposed rates for all entities for next year, Carlsbad is the third lowest for wastewater and eighth lowest for potable water.

Recycled water rates, meanwhile, will be held flat for one year, also starting Jan. 1, although the monthly fixed charges, which apply to potable and recycled water, increases based on the size of the meter.

Rate increase does not create an increase in revenue, but rebalances the rates based on the current reduction due to state mandates, according to the city’s report. In addition, the increase will fund operational expenditures for Fiscal Year 2015-16.

The Wastewater Cost of Service Study conducted by Carollo Engineers concluded, on average, single-family residences with second units discharge approximately 50 percent more than the average single-family residence.

Their recommendation was a 50 percent decrease for second dwelling units from the current rate structure.

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