Although residents said they understand Glendale Water & Power’s need for capital improvements and the increased water rates to make that happen, many at a community meeting Wednesday said they are agitated by the utility’s past money management.
“We’re just frustrated beyond belief,” said Jim Kussman, one of about 20 residents who lobbed complaints at GWP officials as they presented a four-year plan to increase the utility’s revenue.
The utility currently is operating $13.5 million in the red, and is looking to get back in the black with an $11 million reserve. But the almost three-hour presentation at Brand Library quickly turned into a venting session.
The utility has proposed to overhaul rates so those who use more water would get charged a higher rate. A new multi-tiered system, which doesn’t apply to commercial customers, would increase the utility’s revenue by 2%, 2%, 4% and 5% over the next four years.
The average single-family home owner, who uses 450 gallons of water per day and gets charged about $63.78 a month, shouldn’t see much of a difference in the first year. However, high users could see bigger bills.
GWP officials said the rate increases, along with a $60 million bond issuance, is needed to take care of a laundry list of deferred capital improvements, such as relining pipes and improving wells.
Residents tried to push officials to admit that a decades-old practice of transferring millions of dollars from the utility to the general fund to pay for police, library and other services was the catalyst for the rate increase. The city stopped the transfer last year, as city attorneys said the practice could run into legal trouble.
Peter Kavounas, GWP’s assistant general manager for water services, said the utility is creating strategies to move forward and put the transfer behind it. The city still legally transfers money from the electricity side of the utility to the general fund.
When asked if the transfer caused the money woes, Kavounas said: “If the utility hadn’t had an expense in the past, we would have more money than we have now.”
He added that getting the money back would be up to the City Council. Most council members have said they would oppose transferring funds back to GWP.
Kavounas said despite the increase, Glendale’s rates remain lower than those of neighboring cities such as Pasadena and Los Angeles.
Others disliked GWP’s plan to boost charges as Metropolitan Water District increases rates. The city must import water from MWD, which has been increasing its rates and is expected to do so again next year, to make up for a groundwater shortfall. MWD’s 2012 charges are already embedded in Glendale’s proposed rates for this year, which would start in March following council approval. Future rates would fluctuate, depending on MWD changes.
“It’s not really tied down, so you won’t really know,” said resident Robert Erselius.
The city also plans to increase the charge for residential meters, depending on their size, something Glendale currently doesn’t do, but that is industry practice, Kavounas said. That means having a one-inch pipe will cost slightly more than a 3/4-inch pipe, even if residents use the same amount of water.
“I think this charge is the most unfair,” said resident Ed Cooley.
Kavounas said several parts of the utility may seem inequitable, but they are the best decision for customers as a whole. Although GWP has to pay more to pump water to residents at higher elevations, it doesn’t ratchet up their rates, he said.
Kavounas’ also encouraged residents to water lawns less or add artificial turf to backyards. A council decision last year confirmed a ban on the plastic grass in front yards.
The council is set to review the rate increase on Jan. 31 at 6 p.m. at City Hall.