In response to a steady increase in the price it pays to buy water from San Francisco, Redwood City wants to increase its monthly water and sewer rates by 9 percent a year for the next three years.
Sewer and water services require rate increases to maintain and pay for the complex system that delivers services to residents, city spokesman Malcolm Smith said. While the city’s rate increases don’t vary widely year over year, the actual costs of running the system fluctuate dramatically.
The water rate is the most volatile, Smith said. That’s because the city buys the 10.93 million gallons it uses each day from the San Francisco Public Utilities Commission, which supplies many communities on the Peninsula. The San Francisco water rates change year over year because of operating expenses, capital costs, and how much water Redwood City is expected to consume, said Charles Perl of the SFPUC.
“The variables change from year to year, and can vary from a few million to many millions of dollars,” Perl said.
For example, agency documents show that San Francisco’s wholesale rates increased by 38.4 percent in 2011-12 fiscal year, and 11.4 percent in 2012-13. Yet they are projected to decrease by 16 percent in 2013-14.
But Redwood City seeks to keep its own rate increases predictable, smoothing out the fluctuations for its customers.
“Our utilities committee and City Council feel that it’s preferable for our customers,” Smith said.
Ironically, the more water a city uses, the cheaper the per unit cost becomes.
“It’s sort of like bananas,” said Art Jenson, of the Bay Area Water Supply and Conservation Agency. “You don’t pay for the meat of the banana, you’re paying for the costs of growing, transport and displaying it at Safeway,” Jenson said. The costs for water customers too are based on the cost of transport and delivery, he said.
Sewer costs, and thus sewer rates, are more predictable than water rates because the future costs of the system are outlined in various city- and regionwide capital improvement plans, Smith said.
The City Council will consider the rate increases at its the June 10 meeting, and possibly approve the rate increases after council discussion, public comment and a second reading on June 24.
To appeal water and sewer rate increases, a majority of the Redwood City property owners must indicate a “protest” vote on notices mailed by the city to every residence. Although the rate increases are sometimes debated, and altered from the original proposal, there has not been a successful appeal, Smith said.