City of Napa Water Rates
“You don’t know the value of
water until the well runs dry”
- Ben Franklin
September 19, 2023
“Whiskey is for drinking...
Water is for fighting”
-Mark Twain
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2 • Water Supplies
❖ Lake Hennessey
❖ Milliken Reservoir
❖ State Water Project
• Water Treatment - 3 Plants (43 MGD)
• Water Transmission
❖14 Storage Tanks (31 million gal)
❖10 Pump Stations
❖11 Regulator Stations
• Water Distribution
❖ 360 miles of Pipelines
❖ 25,500 Water Services (City & Unincorporated
County)
$941 Million System
City of Napa Water System
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3 ❑ Annual Budget $38 Million
❑ $6M annual Capital Improvements
❑ 24/7 Operation
❑ 68 full-time staff
❑ Real-time monitoring at treatment plants
❑ Hundreds of samples every week
❑ Certified, licensed professionals
operating at all times
Turbidimeters
City of Napa Water System
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Water Rates Cost of Service
❑ Revenue Collected
❖ No taxes
❖ >90% of revenue is bimonthly water bills
❖ Cell tower leases, capacity fees/new connections
❑ Costs to Operate and Invest in System
❖ O&M
❖ Capital Improvements
❖ Non-recurring (Sanitary Survey of Watersheds,
Urban Water Mgmt Plan)
❑ Detailed review 6 years ago in 2017
4 ... costs to provide
service
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Current Status of Water Enterprise
❑ Rates not adjusted since October 2021
❑ Budget deficit of $6.8 M if we maintain $6M annual
CIP commitment
❑ Proposed Rates are necessary
❖ Operate the system
❖ Purchase water supply
❖ Invest in infrastructure
… Reliable System …
5
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6 Demand Projections
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Operating Expenses
❑ Inflationary Increases
❖ 24/7 operation
❖ 68 staff ensure Regulatory Compliance
▪ Water Supply - State Water Project (+$2M)
▪ Treatment – Chemicals (+$700k since 2020)
▪ Distribution –Repair Clamps, Fittings, Pipe
(+$250k)
▪ Risk/Liability – (+$700k)
7
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8 No Rate Increase
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9 Proposed Rate Increase
❑ Meets needs for operations, maintenance and water supply costs
❑ Increases annual contribution to CIP from $6M to $8M by 2028
❑ Prepares for 30-Yr Master Plan and Financial Plan
❑ Supports $100M Bond issuance in 2027 ($7.2M annual debt service)
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10 Identified CIP Needs
❑ Water Quality - focus on Hennessey Treatment Plant Upgrades in 2028- 2030 ($80M)
❑ Water Supply – Hennessey spillway expansion ($10M)
❑ Water Transmission – 12-in on BV Road, 36-in AC main 17 miles ($4M/mile)
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11 Current and Proposed Rates
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12 Current and Proposed Rates
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13 Residential 1-in meter
Indoor Consumption: 8 units (4 units per month)
$42.57
$47.88
$53.62
$58.45
$68.81
$63.71
Typical Winter Monthly Bill
Adjustment is approximately $5 per month
52% of all bills will be at this level or lower
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14 Residential 1-in meter
In/Outdoor Consumption: 16 units (8 units per month)
$62.86
$72.32
$81.00
$88.29
$103.93
$96.23
Adjustment is approximately $8-10 per month
77% of all bills will be at this level or lower
Typical Summer Monthly Bill
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15 Typical Family of Four
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Assistance Programs
❑ *RateShare Program – $25 per bill discount for low-income single family residential customers who are enrolled in PG&E CARE program.
❑ Low Income Household Water Assistance Program (LIHWAP)- Administered through Dept of Health & Human Services, bills are paid directly to City of Napa as eligible utility. Extended thru March 31, 2024.
* RateShare Program is funded by non-rate revenue received from cell tower leases.
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17 * Total cost is higher; a portion of capital costs are paid through property taxes.
Comparison to Bay Area
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18 Clean, safe, reliable tap water:
• 1 penny per gallon
• Delivered!
Value of Water
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❑ Clean safe, reliable, low-cost water for our customers ❑ Manage the system and invest in infrastructure to:
❖ ensure system reliability
❖ reduce long-term O&M costs
Water Enterprise Goals
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❑ Sept 22 – Prop 218 Notice of Public Hearing mailed
❑ Nov 6 – 45-day period for Prop 218 Noticing ends
❑ Nov 7 – Public Hearing to consider adoption of
proposed rates
2024
❑ Jan 1– Adopted rates take effect
❑ Mar 1- First bills under new rates delivered to
customers
Next Steps
2023
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Authorize staff to provide written notice by mail of
the proposed update to water rates in compliance
with all requirements of state law, and schedule a
Public Hearing to consider adoption of updated water
rates on November 7, 2024, at 6:30 pm.
Requested Action
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22 Questions
or
Comments
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