Pasadena Water and Power Considers Water Rate Redesign

The Pasadena Department of Water and Power (PWP) presented the current state of its efforts to redesign the City’s water rate structure Wednesday afternoon to the Pasadena City Council Municipal Services Committee. Essentially, according to the redesign proposal, water rates would be modified to reflect the City’s decreasing demand for water, due to the drought and subsequent conservation, and the  need to make capital improvements in the city’s water lines and facilities.

The proposed new rates “may have a significant impact on some customers,” a PWP report to the Committee said. Among other factors, the plan proposes to use property size as a driving factor in the allocation of water to single family residential customers.

“This is just informational,’ Assistant General Manager Shari Thomas told the Committee. “We are not at the rate stage yet.”

(Thomas has just completed a six-month stint as interim general manager for the department. Gurcharan Bawa will now serve six months in the position, or until a permanent replacement is named. Bawa prepared the water rate redesign proposal which was presented to the committee. )

The PWP plans to present the new rate design to a “study group” over the coming months to collect input and feedback on the proposed changes to the City’s water rates. Following those meetings, the PWP will then present its new rates to the full City Council, most likely in September.

According to the presentation, much of the goal of the program is to create “equity and fairness between and within customer groups.” The new rates are also designed to utilize  “budget based rate concepts through the creation of a minimal health and sanitation water use block,” according to Thomas.

Some major changes to new rate structure include an updating of the definition and sizes of user water blocks, and changing from four distinct water blocks to three, according to PWP. The water blocks contain various specifications of customer use and types of water used, from smaller residential homes using ground water, to other customers using ground water and purchased water, and larger customers using a combination of both for both daily use and irrigation. A Block 1 water block, the lowest-priced,  is approximately 60 gallons per person per day. Blocks 2 and 3 are primarily intended for outdoor uses.

The new programs will also change the classification of customers by consumption. The PWP currently classifies customers by meter size, with ten different classifications. The new classifications would create only three categories — single family residential, multi-family residential and commercial, and PWP is estimating that the three categories would generate an estimated $49.3 million yearly

All single family homes will will receive the same water allocation, while multi-family homes will receive allocations based on the number of dwelling units — for example, a three dwelling multi-family home will receive 12 units, based on 4 units per dwelling.

The 3,610 small commercial PWP customers will receive up to 30 blocks of ground and purchased water, while rate plans for large commercial customers are still being developed, according to the presentation.

The new water rate would also include a fixed component of the Capital Improvement Charge (CIC), based on a building or dwelling meter size. The PWP distribution and Customer charge is estimated to rise 1.5%, system-wide.

Seasonal rates will no longer be in effect in the new rate design, and rates for non-potable water is ongoing.

The first public hearing on the new rates is scheduled for November 14, with the first reading of the new rate ordinance scheduled for November 21.