Rate Increase FAQ
How does the proposed new tiered rate structure differ from the current one?
With the current rate structure, all customers pay the same amount for 1 CCF of water, $12.66. In the proposed rate structure, different classes of customer pay different amounts for a given volume of water, based on SLVWD’s costs to provide water service to each class. SLVWD is adopting tiered rates for single-family residential customers, with rates for low-volume users being about half those of high-volume users. The amount an individual bill will increase depends on the customer class (e.g., single-family residential versus commercial versus industrial versus irrigation), the size of the meter, and the amount of water used.
The other major change to the rate structure is that SLVWD will increase the fixed monthly base rate in order to better reflect its fixed costs to provide service. Also, SLVWD will now explicitly identify two separate components of this base rate: a service charge and a capital charge. The new “capital charge” category is designed to show how much of the revenue will be used to pay the interest and principal on loans for infrastructure upgrades. This may be confusing to some customers because the “capital charge” portion of the base rate was never previously listed separately. This may make it appear that the “capital charge” is a new charge, but it is not – it is merely an additional level of detail concerning the base rate.
SLVWD provides several tables listing the rate increase and its impact on ratepayer bills in the Proposition 218 notice mailed to all customers in late December and on the District website (click on “Water Rates Presentation Final Revised”): https://www.slvwd.com/projects/pages/2023-rate-study-prop-218-process.
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