Reluctant members of the City Council's Environment Committee Wednesday forwarded a proposal to raise water rates in San Diego by nearly 17 percent next year to the full City Council, but without a recommendation for approval.
The city's Public Utilities Department has suggested increasing rates to customers by 9.8 percent beginning in January, and an additional 6.9 percent next July 1.
The hikes would cover a combination of lower revenues as customers reduce consumption amid the drought, and higher expenses. Among the extra costs cited by the department:
— the climbing price of importing water from the main water wholesaler in Southern California, the Metropolitan Water District, via the San Diego County Water Authority
— pricey water received from the Carlsbad desalination plant, which is scheduled to begin deliveries this fall
— the implementation of the city's program to recycle water into drinking water
— replacing aging infrastructure
— installing high-tech water meters
A residential customer whose monthly bill is now around $36 would see a hike to a little over $39, according to a city report. Customers now paying $71 would see their bills go above $77.
The committee members expressed concern that the structure of the rates doesn't provide incentives for customers to conserve. They voted unanimously to pass the issue up to the council in order to keep the department's timeline intact, but they also asked for more information to be provided.
"While I support the investment in local and reliable water supply sources, the people of San Diego have made significant efforts to conserve water during this difficult time of prolonged drought, using 24 percent less in June of 2015 compared to the same month in 2013," Councilman Chris Cate said.
"The current method used to set our water rates neither rewards customers for reduced water usage nor is it a reliable and sustainable system for our city's Public Utilities Department," Cate said.
Under the plan, all city water customers would receive a notice in the mail about a City Council public hearing tentatively scheduled for Nov. 17, when a final decision could be made.
The department's proposal also includes possible rate hikes in 2017, 2018 and 2019, based on projections of future costs for imported water, which makes up 85 percent of the city's total. According to a department presentation delivered to the committee, the cost of water originating from somewhere else has nearly doubled in the last seven years.
The City Council last voted to raise water rates in November 2013, when the hike was more than 7 percent. However, the department presentation says the average monthly bill of $70.81 is below the average of the various water districts in San Diego County, which is just over $78.
The department is already dipping into its reserves, and credit rating agencies will give San Diego's finances a hard look if the increases aren't approved, director Halla Razak said. Water districts statewide are looking at raising rates by double-digits, she said.
