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To the members of the:
CITY COUNCIL
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July 17, 2025
CMWD Board Memorandum
To: Carlsbad Municipal Water District Board of Directors From: Paz Gomez, Deputy City Manager, Public Works
Amanda L. Flesse, General Manager
Via: Sheila Cobian, Assistant Executive Managerl-{XL;
Ccarlsbad
Municipal Water District
Memo ID# 2025041
Re: San Diego County Water Authority Potable Water Pass-Through Rates Update (Districts -All) This memorandum provides an update on potable water rates presented and approved by the Carlsbad Municipal Water District, or CMWD, Board on April 22, 2025. Last month, the San Diego County Water Authority, or Water Authority, Board of Directors approved lower charges than anticipated, so the charges passed on to the CMWD customers will be less than the CMWD Board approved maximum. Recycled water and wastewater rates are not affected.
Background
On April 22, 2025, the CMWD Board approved increases to potable water rates effective July 1, 2025, January 1, 2026, and January 1, 2027, that included pass-through rates from the Water Authority. The pass-through rates are the rates passed directly to customers for the cost of purchasing potable water from the Water Authority. The rates were based on the best information available at the time on future increases from the Water Authority. As stated in the notice for the April 22, 2025, Public Hearing, if the Water Authority adopts its rates below the assumed maximum, then the pass-through charges will be adjusted accordingly.
On June 26, 2025, the Water Authority Board of Directors approved a wholesale water rate increase of 8.3% for calendar year 2026. This figure is significantly lower than the previously assumed 15% increase that was included in the rates presented to the CMWD Board. This adjustment in the Water Authority rate will have a direct impact on the CMWD customer bills starting with the increase that goes into effect on January 1, 2026.
The revised 8.3% increase reflects a more moderate adjustment than initially anticipated, which may provide some relief to the CMWD customers affected by rising water costs. The CMWD portion of the rate increases will remain as approved by the CMWD Board to cover internal costs for operations, maintenance, and infrastructure repair and replacement.
Discussion
In April 2025, the CMWD Board approved increases to the rates for potable water service taking effect on July 1, 2025, January 1, 2026, and January 1, 2027. The chart below shows what the average single-family residential bill would be for potable water, assuming a 15% increase to the Carlsbad Municipal Water District
5950 El Camino Real I Carlsbad, CA 92008 I 442-339-2722 t
CMWD Board Memo -SDCWA Potable Water Pass-Through Rates Update (Districts -All} July 17, 2025
Water Authority pass-through charge for 2026 and a 4% increase in 2027. The overall percentage increase for a single-family customer's average bill varies from the overall Water Authority increase because the CMWD's costs are included in the totals.
Single-family residential average bill with an assumed 15% increase in 2026 and 4% increase in 2027 Water Authority pass-through rate {as presented to the CMWD Board in April 2025) Current
$74
2025
$91
2026
$103
2027
$110
Below is an updated chart of what the average residential water bill would be with the Water Authority-approved 8.3% pass-through rate and an updated assumption for 2026. These charts also include the CMWD portion of the water bill which pays for internal costs to operate, maintain and rehabilitate the water distribution system.
Single-family residential average bill with the approved 8.3% increase in Water Authority pass- through rate
Current
$74
2025
$91
2026
$99
*Assumed 8% rate increase as projected by the Water Authority in calendar year 2027 2027
$108*
While single-family accounts are the most common account type, the savings will also be passed on to all other potable water account types including multi-family, commercial and potable irrigation.
Next Steps
Staff will coordinate with the Communication & Engagement Department on the best way to communicate this update to the customers. Staff will also work with the Finance Department to incorporate the increases in future customer bills.
cc: Geoff Patnoe, Executive Manager
Cindie McMahon, General Counsel
Gary Barberio, Deputy City Manager, Community Services
Laura Rocha, Deputy City Manager, Administrative Services Tim Lyons, Assistant General Counsel
Zach Korach, Finance Director
Amy Ventetuolo, Communication & Engagement Director
Shoshana Aguilar, Senior Management Analyst