Study recommends water rate increase for Carlsbad

CARLSBAD — A recent study is recommending a water rate increase for users within the Carlsbad Municipal Water District.

The cost of service study is requesting the CMWD fall in line with industry standards for its revenue, which consists of 30 percent from fixed rate funds and 70 percent of rate per unit of water used. Currently, the city collects 27 percent from fixed rates and 73 percent from rate per unit.

A public hearing will be held Nov. 29 at 6 p.m. at City Hall, 1200 Carlsbad Village Drive. CMWD customers have until Nov. 29 to submit protest letters.

If approved, rates would increase by about $5 per month, according to the city.

The CMWD serves about 85 percent of the city’s residents, while the remaining 15 percent are customers of the Vallecitos and Olivenhain districts.

“We go through our rates annually, the finance department does, to see where we are at,” said Ligeia Hergy, management analyst for CMWD. “

The fixed part of the water rate is proposed to increase by 9 percent, an increase of $1.92 a month.

The rate per unit of water used is proposed to increase an average of 4.85 percent in 2017 and 2018. Water rates will continue to be billed in tiers. The first 10 units of water used in a month are billed at the lowest rate and, if use increases beyond that amount, the cost per unit goes up. A unit consists of 748 gallons.

Recycled water rates, meanwhile, are proposed to increase by 4 percent in 2017 and 2018. This is due to regional rebates being phased out and the cost of expanding the recycled water system.

Perhaps the main reason for the increase, according to the city, is the cost of imported water. It makes up more than 80 percent of the city’s drinking water supply and the cost continues to rise due to legal and environmental restrictions from Northern California and the Colorado River.

“There are two main drivers,” Hergy said of the rate increases. “Those costs continue to increase.”

The growing cost accounts for about two-thirds of the proposed rate increase.

When customers purchase less water, the cost per customer to provide water usually increases so water agencies can continue operations and maintenance of the delivery system. The cost of service study found this to be true for the Carlsbad Municipal Water District.

The good news for those who have conserved water, however, is they are more likely to stay in the lowest tier of rates. The lowest tier uses 0-10 units, Hergy said.

“The tiers are based on consumption,” she added.

The Water Desalination Project is now online and delivering water, although this water is more expensive than the current cost of imported water. Since the cost of imported water is likely to continue to increase, it will eventually meet and exceed the cost of desalinated water.

The cost to maintain the water system makes up a small part of the increase. The district invests in routine maintenance and new technologies to help ensure the system is as efficient and reliable as possible. This ends up saving money in the long run, according to the city.

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