The City Council tossed out a recommended water-rate-increase plan on Tuesday that would boost Glendale Water & Power revenue by a compounded 26.3% over the next five years, preferring to set the ceiling for their rate discussion at a compounded 20.4% over four years.
The majority of the council said the original proposal from a consultant and staff was too much for customers to bear following water-rate increases in 2012, even though those changes were riddled with errors and caused the utility to undercharge some customers and overcharge others.
“I don’t want to slam people and shock them,” said Councilwoman Laura Friedman, who, along with the balance of her colleagues, except Councilman Dave Weaver, opposed the more expensive option.
The compounded numbers are based on revenue increases systemwide and do not reflect how individual customer’s bills would be impacted because the proposed rates, like the botched ones approved in 2012, differ depending on customer type — such as single-family residential or commercial — meter size, water usage and other factors.
The originally recommended option would have increased the monthly bill of an average single-family residential customer who currently pays $72.12 by nearly 11% next fiscal year to $79.83, followed by four concurrent annual increases of roughly 5%, 4%, 5% and 5%.
City officials did not know how that same bill would be affected by the new 20.4% ceiling and said it would take about a week to crunch those numbers.
The council, which expects to vote on new water rates in July, can select a new rate plan that will have smaller bill impacts than their proposed 20.4% ceiling, but they can’t go over it, according to state law.
Glendale not only needs to increase the water rates to structurally fix the bungled ones — which the city paid a consultant $107,000 to create and were opposed by several residential and commercial customers for being too high before they were approved — but it also needs to boost rates beyond that, city officials said.
If Glendale Water & Power only made structural rate changes — by increasing the rates for those who are being undercharged and decreasing rates for customers being overcharged — the water side of the utility is still expected to be $6.9 million in the red by the end of fiscal year 2018-19.
The water side currently has a $9.9-million deficit and made $8.8 million less than expected since the 2012 rate increases went into effect.
Officials are pursuing legal action against the consultant that made the errors, Willdan Financial Services of Temecula. The city paid Berkeley-based Bartle Wells $130,000 to come up with the new rate proposal.
Proposed rates also include an adjustable drought charge, which would allow the utility to still bring in revenue even as customers participate in mandatory conservation.
Councilman Ara Najarian said he feared that customers would oppose a drought charge, but Glendale Water & Power General Manager Steve Zurn said the utility often faces such a dilemma.
Before the council votes on the rate changes, Glendale Water & Power plans to send out a notice detailing the proposed changes to customers and host several public meetings about the rates at various locations throughout the city.
Community meetings are scheduled from 6 to 7:30 p.m. on the following dates:
— June 4, Sparr Heights Community Center, 1613 Glencoe Way
— June 5, Police Community Room, 131 N. Isabel St.
— June 18, Pacific Edison Community Room, 501 S. Pacific Ave.
— June 19, Boy Scouts of America, 1325 Grandview Ave.