HomeMy WebLinkAbout6/6/2023 Item 7a, Smith
bobbie <
To:E-mail Council Website
Subject:Grossly unfair water rates in SLO
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Dear Council,
I understand that you've seen this request for review of water rates before. It's from our neighbor Richard
Schmidt, a resident of SLO. Please read it again and let us know what we (customers) can do to officially
present this to the Council. I'm a senior on fixed income; like MANY folks in SLO. We'er being penalized
PAYING the most for using the least amount of water. The "base" water fees are grossly unfair and
inequitable.
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Grossly unfair water rates in SLO. “Grossly unfair” is a good description of SLOcity’s water rates, which
charge those practicing water conservation nearly twice the rate of water wasters.
June 6 the city council plans to raise water rates, making the unfairness even greater. This unfairness
concerns me, and I hope it concerns others as well. Here is an explanation of the issue. (The city bills
water by the “unit,” which is 100 cubic feet, or about 750 gallons.)
Let’s look at per unit water charges for four “typical” users: • The “conservation user” who is able to get
along on 2 units per month. This is likely a very thrifty conservation-minded householder performing
conservation the city asks of her, or someone living in a small rental unit who is possibly economically
disadvantaged. • The “low user” who scrapes by on 4 units per month. • The “moderate user” with a family
who consumes 8 units per month. • The “water hog” with a large house, pool or spa, and likely a wasteful
lawn or moss garden, who consumes 16 units and for whom cost is no matter.
Under the rate schedule staff proposes, 2024 effective costs per unit are:
• “conservation user” = $23.67 per unit.
• “low user” = $16.10 per unit.
• “moderate user” = $12.81 per unit
• “water hog” = $13.11 per unit. (Methodology for above: sum the per unit water charges per 2024 rate
chart, add to “base” $30.25 and divide total by number of units.)
This is Regressive pricing, not Progressive pricing.
How is this pricing equitable?
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How does this promote the city’s desire users be conservation conscious?
Clearly there are major problems in the city’s water pricing model. How did the city’s water pricing
get this far off base?
The city used to just charge customers for the water they consumed. Then a new fad in pricing got
introduced, an additional fixed “base” fee. We were told it would be “just $5” and would not be raised. But
once the camel’s nose was in the tent, the fixed fee was raised every year till now staff proposes one
that’s six times the promised “forever” $5 fee. In fact, the proposed increase alone is more than the
“forever” $5. It’s the 2024 fixed $30.25 “base” fee that distorts water charges so that they harm the frugal
and poor and bless the rich and careless.
There are countless better ways to charge for water. I’ll suggest a couple that occur to me, merely to
get some thoughts rolling. First, there need not be any “base” fee at all. We didn’t used to have a fixed
base fee, and got along just fine. Charge people a fair price for what they use, and no more, and problems
solved. If those rates must be adjusted year to year due to consumption and cost changes, so be it; at
least the charges will make sense, which the current charges don’t.
However, there are also fairer “base” rate methods than the city’s fixed $30.25 charge. Here is one idea: •
A variable/graduated base rate indexed to how much water one consumes would promote Equity,
fairness, and conservation. An example of how this might work: for the first unit, a $1 “base”; for the
second unit, $1.50; for the third, $2; etc., in this example using 50-cent increments for each additional unit
of water consumption. The incremental per unit charges would be summed to find the “base” at any
particular consumption level. Of course one would not go through this math for every bill: a published
“base” rate table would make explicit the “base” for each consumption level. So, for example, for our four
hypothetical users, this is how things would play out: • “conservation user” $2.50 “base” producing an
effective unit price of $9.79 instead of the proposed $23.67 per unit. • “low user” $7.00 “base” with
effective unit price $10.29 instead of proposed $16.10. • “moderate user” $22 “base” with effective unit
price $11.78 instead of proposed $12.81. • “water hog” $76 “base” with effective unit price of $15.97
instead of proposed $13.11.
Those are illustrative numbers only and I don’t pretend they are the “right” ones; analysis would
be needed to create a rate schedule. The point is fairer models for charging are possible. The key
takeaway is all charges would be related to actual water use. In a letter to the city council I asked them to
use the June 6 rate setting meeting to fix the inequities in city water pricing. Specifically, I asked them to
take action instead of kicking the can down the road. “
A good action, in my mind, would be “
1. to reject the proposed water rate changes, “
2. give staff direction to return in 90 days with a rate system that corrects the Inequity and anti-
Progressive features of the present system and which also promotes genuine Conservation Pricing, and “
3. continue present water charges in the interim. “This is doable despite the 10,000 reasons staff is likely
to tell you it’s not.
::Author credit to Richard Schmidt
Roberta Smith
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954 Tarragon Ln. 93401
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