Auburn, Calif. – On Thursday (May 16) Placer County Water Agency staff presented the Board of Directors with recommendations for an adjustment to its Zone 1 water rates. This adjustment would be spread over 2 years beginning January 2014. The Board set a public hearing for August 8 to consider the proposed new rates. This would be the first rate adjustment considered by the Board in 5 years.
PCWA’s Zone 1 serves a vast area including the cities of Auburn, Loomis, Rocklin, Lincoln, a portion of Roseville, and many unincorporated communities in western Placer County.
The primary need for the proposed water rate adjustment is an increase in the wholesale price PCWA pays for Zone 1 water. PCWA purchases water from Pacific Gas and Electric Company. The price has been unchanged since 1968.
The increase in wholesale water price resulted from several months of negotiations between PCWA and PG&E on a successor to the 45-year old Zone 1 water contract. A new contract approved by the Board on April 29 extends the contract and updates the pricing. It covers PCWA’s purchase of up to 100,400 acre-feet of PG&E water per year for Zone 1 from the Yuba-Bear river watershed. Most of this water is conveyed through PG&E’s lengthy Bear River and Wise Canals to PCWA.
“PCWA has paid the same wholesale price for PG&E water for 45 years. PG&E’s costs have increased, and especially as they have implemented improvements to their conveyance system,” said PCWA’s Director of Strategic Affairs Einar Maisch. “The new wholesale pricing is more reflective of PG&E’s costs of service today and is expected to go toward PG&E infrastructure improvements to increase the reliability of water delivery to Zone 1.”
“PCWA is currently paying PG&E about $200,000 per year for Zone 1 water. The amount will rise to $3 million in 2014 and to $4 million in 2015. Future increases will be based on an inflationary factor,” said Maisch.
PCWA General Manager David Breninger said, “The new PG&E contract covers water supplies that have historically been used by the people of Placer County for upwards of 150 years and is essential for the future of our County. We are doing everything we can to ensure continuance of a high quality, affordable and reliable water supply for our customers.”
A secondary need for the proposed water rate adjustment is to fund other general operating costs for Zone 1.
“The proposed new water rates will help improve the safety and reliability of both the wholesale and retail water conveyance systems that Zone 1 customers depend upon for delivery of their water supply,” said Breninger.
The recommended Zone 1 water rate adjustments, proposed to be spread over 2 years, will cover both the increase in PG&E’s wholesale price of water and increased operating costs of PCWA. Examples: In 2014 the average winter residential treated water bill would increase by $4.15 per month. The average summer residential bill would increase by $5.85 per month. In 2015 there will be an additional $1.78 per month in the winter and $2.50 per month in the summer.
“The impact of the new rates by 2015 for a typical Zone 1 residential customer is estimated to be around 25 cents per day and more for those who use more water,” said Breninger. “Basically, for the typical residential treated water customer, this equates to an increase of 9.1 percent in 2014 and 3.7 percent in 2015. Untreated water customers should see about the same percentage increase in their water bills,” said Breninger.
Putting this in perspective, Breninger said, “The Agency hasn’t increased rates since 2009, but it is now necessary to do so over the next 2 years. Thus, when viewed over a 6 year period from 2010 to 2015 the amount would equate to a little over 2 percent per year.” “And, going forward,” he added, “it is also recommended to index the water rates to adjust annually subject to a Consumer Price Index beginning in 2015 through 2018.”
The public hearing to consider the proposed rate adjustments will be August 8, 2013, at 2 p.m. at the PCWA Business Center. Notices of the hearing with information on the proposed new water rates will be mailed to all affected Zone 1 property owners and customers. PCWA follows the Proposition 218 notification and hearing process.
General information on PCWA board meetings may be obtained through the Clerk to the Board at (530) 823-4850 or (800) 464-0030.