Water rates up 7.8 percent, sewer up 3 percent

By Karen Brainard

Customers of the Ramona Municipal Water District will see an increase in water and sewer rates, beginning July 1, that are slightly less than those proposed in May.

Treated water rates will increase 7.8 percent and sewer rates 3 percent.

The water board approved the rate increases and its fiscal year 2012-13 $28 million budget on June 26, following a public hearing. The district received five letters and one person spoke at the hearing, all in protest of rate increases.

Customers will see treated water climb from 3.86 per unit to $4.34 per unit. A unit is about 748 gallons of water. With an average household estimated at using 14 units of water, the monthly increase would be $4.63, said RMWD Finance Manager Richard Hannasch.

“Water staff has closely examined budget expenditures for further savings and we’re pleased to announce that the proposed water rates for the upcoming budget are even lower than the amounts that were proposed May 8,” Hannasch told the board.

RMWD sent out Proposition 218 notices, required by state law, to customers with not-to-exceed rates 45 days before the public hearing. The notice showed a proposed 3.5 percent increase for sewer rates and 8.4 percent rise for treated water rates.

The untreated water rate was proposed to go up 8.3 percent but the board approved a 7.6 percent increase. That charge will climb from $3.31 to $3.74 per unit.

Agriculture customers in the Metropolitan Water District’s discount Interruptible Agricultural Water Program (IAWP) will see increases of 2.5 percent for treated water and .8 percent for untreated. In the San Diego County Water Authority’s Special Agriculture Water Rate (SAWR) program, treated water will go up .9 percent, untreated will decrease .3 percent.

Included in the water rates is the electrical charge to pump the water up from the RMWD Poway pump station. That fee is decreasing from 77 cents per unit of water to 65 cents. RMWD General Manager David Barnum said that is due to declining water sales, which means less pumping.

The water service charge is increasing by 8.7 percent for all meter sizes.

Hannasch said during that the current fiscal year the county water authority’s water rate rose 11.9 percent for treated water and 12.8 percent for untreated water. RMWD purchases all of its water from the water authority.

The annual sewer fee for San Vicente wastewater plant customers will rise from $562.15 to $579.02; for Santa Maria customers, the rate will go from $591.79 to $609.55.

Hannash presented the 2012-13 budget with projected expenditures of $28 million, pointing out that it is less than last year’s budgeted expenditures of $28.3 million.

“Keep in mind that inflation in San Diego in 2011 was almost 3 percent,” said Hannasch.

Included in the 2012-13 budget is $100,000 of property taxes to be used for Poway Pump Station upgrades and $500,000 of property tax revenues earmarked for pipeline relocation for the county’s San Vicente Road realignment project. The water district’s total cost to relocate the pipeline is estimated at $4 million.

RMWD will save money by aligning the project with the county’s contract, said the finance manager.

“But make no mistake, this is a pretty significant project for the district. If we’re looking at about $4 million, depending on what the exact cost is and what kind of financing we look at, if debt service runs around $500,000 a year, that’s significant and it absolutely could affect future water rate increases that would be required to fund that project,” said Hannasch.

The pipeline along San Vicente Road is the sole source of water to San Diego Country Estates. State law in 1973 allowed the pipeline to be installed within county right of way with the caveat that RMWD must pay to relocate it when road improvements are made.

The county’s estimated construction start date is in the third quarter of 2013, according to Hannasch.

“A significant but shrinking source of revenue for the district is property taxes,” noted Hannasch.

Property tax revenues for the district in fiscal year 2008-09 was $5.3 million, and they have been declining. For 2011-12, they are expected to total $4.6 million and are forecast to be $4.15 million for the 2012-13 fiscal year, said Hannasch.

Barnum noted that this is the fourth year of belt tightening by the district.

“That is not by accident. That is by design,” he said.

In 2008, when he was the district’s chief financial officer, Barnum said he and staff discussed the “changing world.”

The year 2008, he said, “was an apocalypse of finances.” Part of the plan was to cut costs while providing the best possible service to customers, said Barnum, noting cost-cutting measures included staff reduction and reorganization, deferring some capital projects and “thinking outside the box.”

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