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SLO water, sewer rates go up again

June 18, 2015

water bankSan Luis Obispo water and sewer bills will increase next month and then will rise again in July 2017, continuing a multi-decade streak of increases.

As of July 1, water rates will have increased for 12 straight years. Sewer rates will have increased for at least 23 consecutive years. In 2014, city staffers told CalCoastNews they are unaware the last year in which San Luis Obispo did not raise sewer rates, though they believe it was in the 1980s.

Over the past 22 years, sewer rates have increased by an average of more than 7 percent annually. Water rates rose by an average 9.9 percent annually over the last 11 years.

On Tuesday, the council voted 4-1 in separates votes to raise water and sewer rates. Councilman Dan Carpenter, who has at times objected to rate hikes, dissented on both votes.

The average residential water bill is now slated to increase by about $10 a month, or 17.8 percent. The average monthly sewer bill will rise by $2.36, or 4.6 percent.

Last year, city utilities manager Ron Munds said he expected water and sewer rates to rise by about 3 percent annually in the foreseeable future.

Currently, the average residential water bill is $56.41, Munds told CalCalCoastNews on Wednesday. The average water bill will increase to $66.47 beginning next month, and it will rise to $70.20 starting July 2016.

The average residential sewer bill is currently $51.81. It will rise to $54.17 next month and to $55.77 in July 2016, Munds said.

Combined water and sewer bills will increase from $108.22, the current cost for the average customer, to $120.64, starting next month, and to $125.97 beginning in July 2016.

The current rate hike includes a drought surcharge that the city has added to both water and sewer rates. The surcharge is supposed to offset decreases in revenue stemming from customers using less water during the ongoing drought.

The rate hike also includes an increase in the city’s base fee for water and sewer bills. The city changed its billing system two years ago and implemented a fixed charge that customers must pay no matter how much or little they consume.

The base fee will rise from $5.28 to $7.63 next month and to $9.98 in July 2016. The initial drought surcharge will be 37 cents, and it will increase to 74 cents in July 2016.

The latest rate hikes are in part due to the drought, during which customers have decreased both their water and sewer usage. Now, the city has a state mandate to cut its water usage by 12 percent.

The city’s water fund is expected to complete the current fiscal year at a loss of $1 million. Utilities officials say they dipped into reserves in order to avoid raising rates in the middle of the fiscal year.

But, the city is also dealing with lingering debt from the completed Nacimiento Pipeline project, as well as the sewage treatment plant upgrade that is scheduled to begin in 2016-2017. The city pays more than $6 million annually in Nacimiento Pipeline maintenance and debt service, and it has more than 20 years of payments remaining.

San Luis Obispo is renovating its treatment plant in order to comply with regulatory demands from the state and regional water boards. The upgrade is estimated to cost $87.6 million, and the city plans to issue a $74 million bond to finance it, according to the sewer fund budget.

Due to the plant upgrade, the debt service in the sewer fund will increase from $1.4 million to $6.2 million in 2016-2017.

Critics of the city have also pointed to high staffing costs as reason for yearly rate hikes. Prior to voting on the 2013 rate hike, Carpenter said the council had failed to address high staffing costs, which in turn passed the expenses onto the ratepayers.

Last year, the utilities department had a total of 61 full time employees. They were making an average base salary of $73,000, according to a payroll chart provided by the human resources department.


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Munds, now isn’t this guy who provided the wrong information on conservation measures to the state just last year and a few years ago. Guess he is another fine example of learn by doing. By the way, the numbers provided are extremely misleading and wrong. Every year, they lie to the public and state it is only another 3% next year, when it turns out to be another 9%, then every year administration somehow finds another $6million in one time cash surplus to be used for special projects for their friends. By the way, the City often waives water and sewer impact fees for special developers – their friends and we all pay for it in our rates. SLOTOWN has some of the highest water rates in the state. It must cost so much more to treat surface water in SLOTOWN than any other place California. One has to wonder where the money is really going. Maybe just a little something to supplement their incomes for all those second and third homes these staff own.


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Thank you for pointing out that the city is giving developers — certain developers, that is — a free ride on our backs. Since the 1970s, the law was “development pays its own way.” The current Lichtig-led clowns changed that to “development pays its fair share,” which is their propaganda for us paying the other share, and a sellout by Lichtig, Marx, Ashbaugh, Christianson and Rivoire of the good old way of doing things, which had fairly successfully protected residents’ pocketbooks from being pick-pocketed by developers like Chevron, Copelands, Grossman and Mangano. Now we have wealthy outfits like Chevron lining up for a handout we’ll all pay for. They call this the happiest place? No more, folks.


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Isn’t this a disincentive for SLO to find more water? When they allowed the state water pipeline to run right by San Luis Obispo without tapping into it the future was predictable. A drought will always harm SLO more than other cities because of that shortsightedness.


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Do you realize that the State Water pipeline is running at greatly reduced levels and won’t provide enough water for many of its customers to justify expenses this year? Not paying for access to a very untrustworthy source of water (in a drought) is one of the few smart decisions the City has made. It is a pity that they haven’t shown that much wisdom in regards to other actions they have taken.


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Let me guess you or a family member is on the Dole, i.e. working for government. Your statement is wrong and very misleading. The City paid for access to Lake Nacimiento to offset drought conditions because it was a reliable source, but failed to inform the public that every time there is a drought the lake is often too low to pump. The lake is nearly empty, so the City spent $60 (total price $160 million plus) plus million dollars for a pipeline to a mud-hole – now that was blundering mistake and stupid decision. All the facts were there in front of them, and they ignored them. All the City has done is grapple to steal water from north county to drain it dry at the detriment of north county residents. The City’s reliable water resource is no longer reliable under recent legislation.


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“no longer reliable under recent legislation…” Please explain. That makes no sense. Its “unreliability” is due to drought. Nacimiento historically has been a great water source — at least in quantity, the mercury is something else again. The watershed is huge, and historically it fills the lake reliably. The current drought may or may not be the future, but you really can’t blame the city for failing to realize that years ago when they bought in.


Anyway, the way Nacimiento water is allocated, the first 16,000 acre feet per year that leave it belong to us. Only after we get ours (and by “we” I mean users in SLO Co.) can Monterey County take theirs, even though they own the lake. Absent perpetual drought, that still sounds like a pretty good source of water.


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Don’t forget the city signed up for state water, and the voters did a referendum and overturned that. The city’s always been stupid, the voters smart.


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Actually you don’t understand it at all. The problem isn’t that SLO has too little water, it’s that they’ve signed up for too much, and all that must be paid for whether it’s delivered and used or not. They never needed state water (a dry hole that’s called “paper water” — just ask Morro Bay how well that’s worked out) or Nacimiento water. Now they have to pay for Nacimiento bonds and other debt. The city’s in the stupid situation of having to raise rates because the state’s 12% reduction prevents them from selling water, so to pay their debt, they have to charge more for what they do sell.


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Good old government: damned if you do, damned if you don’t. Oh yeah, thanks, for cutting back…..but now that you did we need to raise your rates because you did. And then there’s the double whammy if you don’t….then you have to pay a fine.


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Yes, in the government sector, when usage goes down along with revenue, cost never goes down and often goes up, figure that one out.


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If the vast majority of service costs exist independent of service levels, yes, rates do need to increase to cover expenses (barring other income sources). I do not know if this is the case in SLO and suspect that it may not be as typically a significant part of the cost of services is in personnel. I know that no one wants to lay off employees unless the slack for them looks to be long term, but the City also has a duty to the ratepayers as well and may have to “bite this bullet” to help make ends meet.


As for the rate increases, there should be a flat rate for “X” gals of water per person per household and then rapidly increasing rates for use beyond that to encourage conservation. They appear to be more interested in appeasing those with disproportionately large water consumption with their new rate structure. I wonder why.


Well the SLO City voters have had plenty of time to observe the actions and “philosophies” of these politicians and continue to elect them despite their records. Either the majority of voters in SLO are ignorant/misinformed or they are the ones benefiting from these actions. I am glad I don’t have to feel the consequences of this City Councils spending policies and feel sorry for the minority that keeps getting over-ruled. However, the majority of SLO voters deserve what they will be receiving until sense is beaten into their skulls with the tax collector’s golden hammer.


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The City needs to outsource Utility Services to a service provider to eliminate the highest paid water staff in the county, in fact some of the highest paid field workers in the City and in the region.


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Who can be surprised about this. If you followed the Budget Process, City Manager Katie Licktig got a raise and more of a car allowance ($400 a month) to drive back and forth to Malibu where she spends most of time, Christine got ANOTHER raise for doing a horrible job of advising and defending her legal actions (although we continue to pay her brother for a temporary job that he has not been qualified to pass the exam on) and then we have the NEW 13 POSITIONS that the City Council approved for more enforcement against the taxpayers. How stupid can the taxpayers be in SLO! Keep voting for those Democrats, and they will keep taxing, taxing taxing!!!


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There is no way on god’s green earth that the drought surcharge will go away when the drought ends. This exact same thing happened in the late 80’s and early 90’s during that drought.

When I expect less revenue to be coming into my family budget I find ways to cut back. In the City of SLO they just ask everyone else pitch in.

How’s the Nacimiento pipeline working for us?

Oh well, it isn’t like we didn’t see this coming.


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Follow this in Texas, now that their drought is over the juristictions still need the money.


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Get all the nonpotable water you want at the city’s corporation yard located at 25 Prado, adjacent to the 101 northbound offramp. Phone them at (805) 781-7220 for more info.


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With this additional bounty they should hire a water czar and a sewer czar. The water czar can oversee the rainfall and the sewer czar can oversea the city council.


Would anyone be surprised if they discussed the lack of affordable housing on the same agenda?


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Now repeat after me: Water, Sewer, Garbage—–Now go out and justify as much as you can for your local Gov, we are keeping ours.


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What does this mean?


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Welcome to world of government, paying more for less.


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