Residents may see their water bills increase as soon as next year, but the rate hikes would affect the biggest users most under a proposal unveiled Tuesday at City Hall.
“People being less conservative with their water will see their rates increase,” said Pierce Rossum, a project manager with Willdan Financial Services, a consultant hired by the city to study water rates.
Under the proposal, presented at a joint meeting Tuesday of the City Council and Glendale Water & Power Commission, those using the least amount of water, who typically pay $44 a month, would see a 1% increase, while those who use a medium amount, for around $82 a month, would see a 3% bump. Those who use an excessive amount would see their roughly $158 bill rise by 13%.
The typical utility customer would be on the side of the small rate hike, Rossum said.
Utility officials said the restructured rates were needed to keep revenues in line with rising expenses and complete needed infrastructure projects. At the same time, the proposal would encourage ongoing conservation.
Glendale Water & Power Commissioner Deborah Dentler told officials she understood the need for more revenue, but said residents were hurting financially amid the protracted recession.
“I think it’s going to be a very hard sell,” she said.
Without the changes, officials said, the water side of the city's utility will find itself underwater as its main supplier, the Metropolitan Water District of Southern California, continues to ratchet up its wholesale rates.
Peter Kavounas, assistant general manager for water operations, said the utility needs more revenue to complete major capital improvements, including so-called smart meters. The city received millions in federal grant money to help pay for the overhaul, but that money only applied to electrical operations.
He projected a $11.5-million deficit for the current fiscal year.
The idea behind the tiered charges is that those who use more water are driving up Glendale’s need to buy water from Metropolitan, which is more expensive than local groundwater. Currently, all customers pay the same rate.
The tiered rate changes wouldn’t apply to commercial and irrigation customers who use tens of thousands of gallons of water per month. That group would instead see a blanket rate change.
“At the end of the day, we want to make sure it’s very logical, systematic and very easy to understand,” said Habib Isaac, a project manager with Anaheim-based Willdan.
In addition to the rate redesign, Glendale Water & Power is seeking permission to issue $120 million in electric and water bonds. Another proposed change would swap bimonthly bills for a monthly cycle next year.
“Glendale’s not alone in this situation,” said General Manager Glenn Steiger, adding that other utilities have been considering rate redesigns and increases.
Glendale increased water rates by 3.8% in December, while the Crescenta Valley Water District has plans in place to increase rates by 8.1% through 2012.
City officials said they'd bring the options back for further discussion in the coming months.
“I’m for a rate redesign,” said Councilman Frank Quintero. “I think it’s something we should have done a long time ago.”