Item 7 - Set Public Hearing for Proposed San Diego County Water Authority Pass-Through Water Rates for 2025 Implementation

October 15, 2024, Item #7
DATE:

TO:

FROM:

CONTACT:

SUBJECT:

Summary:

October 15, 2024
Honorable Mayor and Members of the City Council
Craig Schmollinger, Director of Finance @
Craig Schmollinger, Director of Finance
(858) 668-4411 or [email protected]
Set Public Hearing for Proposed San Diego County Water Authority Pass-Through Water Rates for 2025 Implementation
The San Diego County Water Authority (SDCWA) recently approved a rate increase totaling 13.52% to Poway which takes effect in January 2025. This increase is more than double the 6% annual SDCWA rate increase built into the 2025 water rates adopted by the City Council on November 2, 2021. The new SDCWA rates trigger the need for an additional water rate increase to pass-through the new SDCWA costs to ratepayers. The Water Fund cannot absorb the projected $1.27 million in additional costs resulting from the increased SDCWA rates. To ensure the ongoing financial sustainability of the water enterprise system staff is recommending the new SDCWA rates be passed through to ratepayers beginning in January 2025 when they take effect. To be clear, staff would not be recommending additional rate changes for January 2025 were it not for the increased rates adopted by the SDCWA. This staff report recommends setting the public hearing date on December 3, 2024 for proposed SDCWA water pass-through rate increases for water rates.

The City relies almost exclusively on the SDCWA for its raw water supply and therefore does not have a choice in accepting rate adjustments from the wholesale water provider. These increased costs were adopted by the SDCWA on July 25, 2024 and will go into effect in January 2025. While Poway's four year rates anticipated increases in the cost to purchase water of 6% per year, the new SDCWA increases to Poway are 13.52% which is well beyond what the rate model projected. City rates cannot absorb these large increased costs for wholesale water purchases. Since Poway's water rates are comprised of several factors (i.e. maintenance and operation of the water system, water treatment costs, and staffing costs), the actual pass-through rate increases to customers will be less than the

It
is
recommended
the
City
Council
direct
staff
to
set
the
public
hearing
for
December
3,
2024
and
proceed
with
the
Proposition
218
process
which
includes
mailing
the
notice
of
public
hearing
to
ratepayers
(Attachment
A)
pursuant
to
California
law
for
this
proposed
wholesale
pass-through
water
rate
adjustment.

Discussion: On
November
2,
2021,
the
City
adopted
new
rate
structures
and
four-year
rate
increases
for
water,
recycled
water,
and
wastewater
rates
that
are
effective
for
calendar
years
2022,
2023,
2024
and
2025.

Actual
City
water
purchase
costs
for
2022,
2023
and
2024
have
been
in
close
alignment
with
City
projections
and
budgeted
figures.

However,
after
a
review
of
projections
for
wholesale
water
purchase
costs,
specifically
the
new
rate
increases
adopted
by
the
San
Diego
County
Water
Authority
(SDCWA)
that
take
effect
in
January
2025,
new
water
pass-through
rate
increases
are
needed
for
2025,
to
ensure
the
financial
sustainability
of
the
water
enterprise
system.

This
staff
report
will
focus
on
what
is
driving
the
proposed
pass-through
rate
increases.

Proposed
Water
Rates:

In
November
2021,
the
City
Council
adopted
four-year
water rate
increases
to
cover
calendar
years
2022, 2023,
2024
and
2025.

The
final
approved
increase
will
take
effect
in
January
2025.

The
approved
rates
cover
the
increasing
costs
of
providing
safe,
reliable
water
on
demand
to
ratepayers.

While
Poway's
four-year
rates
anticipated
increases
in
the
cost
to
purchase
water
of
6%
per
year,
the
approved
SDCWA
rate
increase
of

13.52%
for
2025
is
more
than
double
what
was
anticipated
in
our
rate
model.

The
Water
Fund
cannot
absorb
these
large
increased
costs
for
wholesale
water
purchases.
which
are
projected
to
result
in
a $1.27
million
revenue
shortfall
in
water
purchase
costs.

Current
City
rates
cannot
absorb
these
unplanned
large
increased
costs
for
wholesale
water
purchases.

Out
of
23 agencies,
the
City
is
one
of
three
retail
water
providers
in
San
Diego
County
that
does
not
have
a
wholesale
service
pass-through
provision
authorizing
automatic
pass-through
of
these
wholesale
service
cost
increases.

These
industry
standard,
best
practice,
pass-through
provisions
will
be
incorporated
for
City
Council
consideration
with
the
next
full
cost
of
service
study.

This
proposed
water
pass-through
adjustment
would
be
the
only
pass-through
adjustment
for
the
City
in
2025
regardless
of
subsequent
hypothetical
adjustments
from
the
SDCWA
that
may
be
effective
in
2025
prior
to
the
completion
of
the
next
full
cost
of
service
study.

Imported
Water:

The
lone
factor
driving
the
proposed
pass-through
rate
increase
is
increases
to
City
purchased
water
costs
charged
by
the
SDCWA.

San
Diego
County
has
a
semi-arid
climate.

Before
1947,
the
San
Diego
region
relied
on
rainfall
and
groundwater
to
meets
its
water
needs
(SDCWA,
Urban
Water
Management
Plan
2020).

As
the
economy
and
population
grew,
local
water
resources
became
insufficient
to
meet
the
region's
water
supply
needs
and
required
imported
water
from
hundreds
of
miles
away
to
support
the
growth.

Much
of
the
region's
water
is
imported
from
northern
California
near
San
Francisco
and
Sacramento
(i.e.
the
Bay-Delta).

Importing
water
is
very
energy
and
infrastructure
intensive.

Over
time,
the
cost
to
transport
this
water
increases
as
factors
like
energy
prices
increase.

Investment
by
SDCWA
into
regional
water
supply
and
infrastructure
projects
to
reduce
reliance
on
imported
water
and
mitigate
the
effects
of
natural
2 of
12 October 15, 2024, Item #7
disasters, such as earthquakes, is also expensive. For example, SDCWA's investment into the Claude "Bud" Lewis Desalination Plant cost close to $1 B, but it gave the region a new drought-proof, locally controlled supply of water.

Imported water represents almost 60% of City water operating costs. When imported water costs increase, this significantly impacts City water rates which are passed on to customers. The SDCWA rate and charge increase to the City is 13.52% for calendar year 2025. Since Poway's water rates are comprised of several factors (i.e. maintenance and operation of the water system, water treatment costs, and staffing costs}, the actual pass-through rate increases to customers will be less than the

7.52% differential between the SDCWA rates the City anticipated in the rate model and the actual SDCWA rates which take effect in January 2025. As illustrated in Table 1 later in the report, the average customer will see an increase of just over 3% on their bi-monthly bills as a result of the SDCWA pass through rate increases. In an effort to help mitigate impacts to member agencies, SDCWA took several actions to reduce the increases to rates including applying grant funding of $19.7 million, delaying capital expenses of $7 million, and trimming operating costs by $2 million. Their rate increase was driven by an average rate and charge increase of 11 % from the Metropolitan Water District (MWD), one of SDCWA water suppliers, along with wholesale costs from operating the Claude "Bud" Lewis Desalination Plant. Additionally, the impacts of both the Rainbow and Fallbrook Municipal Water District's detaching from SDCWA has resulted in an increase in SDCWA costs being spread among the remaining 23 member agencies that continue to receive water from the SDCWA. The SDCWA also has declining water sales to those remaining 23 member agencies which results in less water sold to spread SDCWA costs. The SDCWA projected their water sales downward by 20% and 15% from previous adopted figures for Fiscal Years 2024 and 2025, respectively (source: SDCWA Staff Report for Fiscal Years 2024 & 2025 Mid-Term Budget, June 19, 2024). The result is an increase in costs spread among less units of water sold for the remaining SDCWA member agencies, including Poway.

Due to the substantial increase in water purchase costs from SDCWA, wholesale costs to the City have increased beyond the projected 6% annual cost increase for calendar year 2025 by $1.27 million. As a result of this significantly higher increase in wholesale water purchase costs beyond the 6% SDCWA rate increases included in the adopted rate structure, staff is recommending an adjustment to pass through SDCWA water rate increases to recover these higher than anticipated costs which help ensure the ongoing financial stability of the water enterprise.

The City retained Raftelis Financial Consultants (Raftelis) in 2021 as utility rate experts in the water and sewer rate setting field for over 30-years. Raftelis provided a Water Rate Model and recommendations resulting in the noted water rate adjustments for calendar years 2022, 2023, 2024 and 2025. In May 2024, the City again retained Raftelis to provide a limited-scope update to the noted Water Rate Model based on the large wholesale water rate increases the SDCWA adopted for 2025.

Raftelis completed its analysis with the results included in a pass-through technical memorandum (Attachment B). The recommended water pass-through rate adjustments to recover the increased SDCWA wholesale water increases result in a uniform increase in water use (commodity) rates to City customers of $0.32 per billing unit (1 unit= 100-cubic feet= 748 gallons).

Table 1 below shows the estimated impact to residential customers who have a¾" water meter and use 29 units of water over one bimonthly billing period (every two months). 3 of12
October 15, 2024, Item #7
Table 1: Estimated bimonthly Residential Impacts of Wholesale Water Rate Pass Through Approved Proposed
Debt Funding Option Existing Jan. 2025 Jan. 2025
Revenue Increase(%) N/A 8% 3.2%2
Estimated Water Bill1 $269.90 $293.41 $302.73
Impact($) N/A $23.51 $9.32

1. Assumes the average residential customer has a¾" meter and uses 29 units of water bimonthly.

2. Proposed rate increase impact for the average residential customer.

As the table shows, the average residential customer would be paying $9.32 more per bimonthly billing period for water in January 2025 with the proposed rate adjustment. This impact reflects the difference between the already approved January 2025 rates with the proposed pass-through wholesale water rate adjustment.

Community Outreach:

To help the community understand the impacts of the proposed pass-through rate increases, staff updated the residential bill estimator tool (https://poway.org/175/Rates-Fees). This will help evaluate how the proposed increases impact their specific usage patterns. This tool, as well as information specifically about the majority-protest public hearing, and proposed rates, will be posted to the homepage of the City's website and the Water and Sewer Services section of the Finance Department webpage. This information will also actively communicated to the public via the Poway Today e newsletter.

Timeline:

The following graphic shows the proposed rate cycle for the potential rate adjustment.

Set Public Hearing: Mail 218 Notice: Public Hearing: Rates Effective:

October 15, 2024 By October 18, 2024 December 3, 2024 January 1, 2025 Environmental Review:

This action is not subject to review under the California Environmental Quality Act (CEQA).

Fiscal Impact:

There is no direct fiscal impact associated with this staff report because it only sets the public hearing.

However, based on the information contained in this staff report and the analysis completed by Raftelis, there will be insufficient revenues to fund water purchase costs without passing through the recently adopted SDCWA rate increases to ratepayers. Without the pass through, it is estimated the City will collect approximately $1.27 million less than needed to cover water purchase costs. Tapping into the Water Fund Reserves to cover this shortfall is not an option, as we are required to maintain the reserves at certain levels as a provision of the bond covenants for the water revenue bonds issued to pay for the Water Infrastructure Improvement Program.

Safe reliable water delivered on demand to an average residential ratepayer costs approximately one penny per gallon.
4 of 12
October 15, 2024, Item #7
Public Notification:

The California Constitution, Article XIIID, Section 6, states that local governments must hold a Majority Protest Public Hearing and notify property owners at least 45 days in advance of the public hearing related to proposed water, recycled water, and wastewater rates. The notice (Attachment A) will be mailed at least 45 days prior to the public hearing, or on or before October 18, 2024. The public hearing will take place as follows:

Attachments:

Tuesday, December 3, 2024 at 7:00 p.m.

City of Poway Council Chambers
13325 Civic Center Drive
Poway, CA 92064
A. Notice of Public Hearing: Proposed Pass-Through Water Rates B. Raftelis Water Rate Technical Memo
Reviewed/Approved By:
w~~:::----
Assistant City Manager
5 of 12
Reviewed By:

Alan Fenstermacher
City Attorney
October 15, 2024, Item #7
The
San
Diego
County
Water
Authority
(SDCWA)
recently
approved
a
rate
increase
totaling

13.52%
to
Poway,
which
takes
effect
in
January
2025.

This
increase
is
more
than
double
the
6%
annual
SDCWA
rate
increase
built
into
the
2025
water
rates
adopted
by
the
City
Council
on
November
2,
2021
.

The
new
SDCWA
rates
trigger
the
need
for
an
additional
water
rate
increase
to
pass-through
the
new
SDCWA
costs
to
ratepayers
. The
Water
Fund
cannot
absorb the
projected
$1.27
million
in
additional
costs
resulting
from
the
increased
SDCWA
rates
.

To
ensure
the
ongoing
financial
sustainability
of
the
water
enterprise
system
staff
is
recommending
the
new
SDCWA
rates
be
passed
through
to
ratepayers
beginning
in
January
2025
when
they
take
effect.

Staff
would
not
be
recommending
additional
rate
changes
for
January
2025
were
it
not
for
the
increased
rates
adopted
by
the
SDCWA.

Since
Poway's
water
rates
are
comprised
of
several
factors
(including
maintenance
and
operation
of
the
water
system
, wate
r treatment
costs,
and
staffing
costs),
the
actual
pass-through
rate
increases
to
customers
will
be
less
than
the

7.52%
differential
between
the
SDCWA
rates
the
City
anticipated
in
the
rate
model
and
the
actual
SDCWA
rates
which
take
effect
in
January
2025.

The
average
customer
will
see
an
increase
of
just
over
3%
on
their
bi-monthly
bills
as
a
result
of
the
SDCWA
pass-through
rate
increases
.

As
a
best
practice
, almost
all
water
agencies
(20
out
of
23)
in
San
Diego
County
have
pass-through
provisions
in
their
adopted
rate
schedules
allowing
them
to
automatically
pass
on
any
increases
in
SDCWA
rates
to
customer
. Poway
does
not.

As
a
result
-
and
in
compliance
with
Proposition
218
-
enclosed
in
this
notice
are
the
proposed
pass-through
rate
adjustments
for
2025
. If
the
SDCWA
didn't
more
than
double
the
anticipated
6%
annual
increase
in
water
purchase
costs
for
2025,
Poway
would
not
need
to
pass
these
costs
on
to
water
customers
through
the
recommended
adjustments.
6 of
12 Attachment
A
NOTICE
OF
PUBLIC

MEETING
Tuesday,
December
3,
2024
at
7 p.m.

City
Council
Chambers
13325
Civic
Center
Drive,
Poway
On
Tuesday
, December
3, 2024
at
7 p.m.
the
Poway
City
Council
will
consider
adopting
proposed
changes
to
water
charges
. If
adopted,
the
rate
adjustments
will
become
effective
January
1 of
2025
and
reflected
on
bimonthly
bill
statements
in
March
or
April.

The
City
bills
for
water
service
bimonthly
(every
two
months)
based
on
consumption
during
the
two
months
pr
ior
to
the
billing
date
.

All
interested
persons
are
invited
to
appear
at
the
meeting
to
give
oral
or
written
testimony
on
the
proposed
rate
adjustments.

Rate
protests
must
be
submitted
in
writing
ahead
of
the
council
meeting
. City
Council
meetings
are
open
for
in-person
participation
or
viewing
online
.

Visit
poway
.org/councilmeeti
ngs
for
more
information
.

Details
on
the
written
protest
process
are
located
on
the
back
page
of
this
notice
.

October 15, 2024, Item #7
Proposed
Pass-Through
Changes
to
Water
Rates
The
City
of
Poway
provides
safe,
reliable
water
on
demand
to
its
customers
and
purchases
nearly
100
percent
of
its
water
from
SDCWA.

Purchased
water
represents
almost
60%
of
City
water
operating
costs.

When
imported
water
costs
increase,
as
with
the

13.52 %
increase
in
2025,
this
significantly
impacts
City
water
rates
, which
are
passed
on
to
customers
.

The
current
adopted
water
rate
structure
assumed
SDCWA
annual
rate
increases
at
6%.

Actual City
water
purchase
costs
for
2022,
2023
and
2024
have
been
in
close
alignment
with
City
projections
and
budgeted
figures.

However,
for
2025
the
cost
to
purchase
imported
water
has
increased
by
over
double
what
was
anticipated
in
the
adopted
water
rates
. The
SDCWA
adopted
rates
on
July
25,
2024
represent
a 13.52%
increase
to
Poway
for
2025,
which
equates
to
an
additional
cost
of
$1.27
million
. The
City
cannot
absorb
these
large
increased
costs
for
wholesale
water
purchase
.

To
help
ensure
the
financial
sustainability
of
the
water
enterprise,
to
ensure
legally
binding
debt
services
bond
covenants
are
met,
and
to
meet
Financial
Policy
minimum
reserve
requirements,
the
City
is
proposing
pass-through
adjustments
in
potable
water
rates
effective
on
January
l,
2025.
0 For
additional
information
on
how
your
rates
have
been
calculated,
please
refer
to
the
staff
report
on
October
15,
2024
titled
"Set
Public
Hearing
for
Proposed
San
Diego
County
Water
Authority
Pass-Through
Water
Rates
for
2025
Implementation
."

CURRENT
&

PROPOSED

PASS-THROUGH
WATER
RATES
Single
Family
Residential
Tier
1:
1-20
Units

6.00 6.40

6.72 Tier
2: 21-56
Units

7.00 7.46

7.78 Tier
3:
57+
Units

9.73 10
.37
10 .69
Multi-family
Residential

6.15 6.56

6.88 Landscape
Irrigation

8.53 9.09

9.41 Non-residential

6.54 6.97

7.29 City
Potable
Usage

6.54 6.97

7.29 1 unit
= 7 48
gallons
Any
water
rates
or
fees
associated
with
water
service,
including
raw
water,
not
addressed
within
this
notice
shall
remain
in
full
force
and
effect
as
previously
adopted
by
the
Poway
City
Council.

October 15, 2024, Item #7
Proposed Pass-Through Rate Change Protests
As part of the pass-through rate setting process, on December 3, 2024, the City of Poway will conduct a public hearing on the proposed changes to rates and will consider all oral and written protests to the proposed pass-through changes. Oral comments at the public hearing will not qualify as formal protests unless accompanied by a written protest. Only one written protest will be counted per identified parcel. While email is not an official rate protest mechanism under California law, the City Council values resident input and will read all email correspondence regarding rates.

Written protests must include:

A description of the property, such as the address or assessor's parcel number; and The name and signature of the customer submitting the protest.

The City Council will receive a final tabulation of all written protests received by the City Clerk. Written protests must be received by the City Clerk's office no later than 12 p.m. December 3, 2024 or can be submitted in writing in the Council Chambers before the public hearing is closed. If a majority of the affected customers do not file written protests of the proposed rate changes, the Council will then consider and may adopt the rate changes described in this notice. If a majority of affected customers file written protests, the City Council will not adopt the proposed rate adjustments and the City will reconsider the rate structure and rates.

How were pass-through rates determined?
The City utilized a third-party rate consultant as utility experts in water rate setting who leads a cost of service study update in partnership with staff. The study designs a legally compliant rate framework that recovers water costs across different customer classes. These studies are typically updated every four to six years to ensure the rate design remains fair and equitable. The most recent study was performed in December 2019 and updated in late 2021 for rates that went into effect beginning in January 2022. The current review involved an update based on the large 13.52% increase in costs to the City from the SDCWA, which is more than double what the rate structure anticipated for purchased water costs and equates to $1.27 million in additional costs to Poway for 2025. 8 of 12
For rates information and links
to resources quoted in this
notice, scan this QR code
or visit:
poway.org/rates-fees.

October 15, 2024, Item #7
City
of
Poway
PO
Box
789
Poway
, CA
92074-0789
DATED

MATERIAL
DO
NOT
DELAY

DELIVERY
Important
information
about
your
WATER
account!
The
City
of
Poway
is
mailing
this notice
to
you
because
you
are
a water
customer
responsible
for
payment
of
water
fees
,
or
you
are
the
owner
of
record
for
a property
that
receives
water
service
. This
notice
describes
proposed
pass
-through
adjustments
to
water
rates
and
provides
notice
of
the
upcoming
public
hearing
at
which
these
proposed
changes
will
be
considered
by
the
Poway
City
Council
. If
you
have
any
questions
regarding
this
notice,
please
call
(858)
668-
4401
.
9 of
12 October 15, 2024, Item #7
~ RAFTELIS
Technical Memo
To: Brad Rosen, Wendy Kaserman, Craig Schmollinger, City of Poway From: John Wright, Sudhir Pardiwala, Raftelis
Date: October 1, 2024
Re: Proposed Water Rate Pass-Through Adjustments for January 1, 2025 On May 6, 2024, the City of Poway retained Raftelis to develop proposed water rate pass through adjustments, based on the Water Rate Model Poway previously retained Raftelis to complete in 2021. These pass-through adjustments are intended to recover wholesale water supply costs from the San Diego County Water Authority (SDCW A) that significantly exceed the levels originally assumed in the City's 2025 water rates which will become effective on January 1, 2025.

Overview of Water Rate Pass-Through Adjustments
In November 2021, the City of Poway adopted water rates for 2022 through 2025. The Proposition 218 notice for these rates did not include a provision for the City to pass on to customers increased wholesale water supply costs not under direct City control. Therefore, any proposed increases to the City's water rates beyond what was approved in November 2021 will be subject to a new Proposition 218 process.

California Government Code Section 53756 authorizes water agencies to use pass-through adjustments for wholesale cost increases. Pass-through adjustments are commonly used by water service providers in San Diego County and throughout California. Since the City approved water rates in November 2021, increases in SDCW A water supply costs have exceeded those assumed when the rates were originally calculated. Further large increases for wholesale water rate adjustments that were adopted by the SDCW A Board on July 25, 2024, that will take effect in January 2025.

To help pay for the cost increases, the City requested that Raftelis develop water rate pass-through adjustments. If implemented by the City, the pass-through adjustments will reflect changes in SDCWA water supply costs that will take effect on January 1, 2025.

Calculation of the 2025 SDCWA Water Supply Cost Pass-Through Adjustment Table 1 shows the proposed 2025 pass-through adjustment calculation for SDCW A water supply costs. Column B in Table 1 shows the projected water supply costs used to develop the 2025 water 25185 Madison Avenue, Suite A, #9
Murrieta, CA 92562
www.raftelis.com
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2 rates originally approved by the City in November 2021. As shown in Line 16 of Column B, SDCW A water supply costs were originally projected to be $18,953,968 in 2025. As shown in Line 19 of Column B, this equates to a unit cost-of-service of $4.81 per hundred cubic feet ($4.81/ccf) based on customer billed water consumption of 3,941,112 ccf as originally projected for 2025.

Column C in Table 1 shows the estimated water supply costs the City will incur in 2025 based on the actual rates and charges formally adopted by SDCWA on July 25. 2024. As shown in Line 16 of Column C, SDCWA water supply costs are estimated at $20,220,025. As shown in Line 19 of Column C, this equates to a unit cost-of-service of $5.13/ccfbased on customer billed water consumption of 3,941,112 ccf as originally projected for 2025.

The differential between the original projected 2025 unit cost-of-service of $4.81/ccf (Column B, Line 19) and the estimated 2025 unit cost-of-service of $5.13 (Column C, Line 19) is $0.32/ccf (Column C, Line 20). Thus, the proposed 2025 pass-through adjustment for SDCW A water supply costs is $0.32/ccf.

Table I: 2025 SDCWA Water Supply Cost Pass-Through Calculation (A)
Line Item
• I I I I f • , '
(8)
Projected 2025
SDCWA Water Supply
Costs Originally llsed
to Develop 2025 Rates
(C)
Estimated 2025
SDCW A Water Supply
Costs Based on
Ado11ted SDCWA
2025 Rates
2 3
4 _MWD Readines,:_-to-Ser':'.:_ Charge
MWD Capacity Charge
--=-----_ $321,82ol _____________ $276,744
$291,531 r--$287,880
Supr,_ly Reliabili!_Y Charge __ Jl,09~,559 I
5 ___ Customer Service Charge _________ _ $705,245 ------- $1,774,306 $1,183,662
$11D>s2
-----
$1,646,466 6 _ r Storage Charge _ _ __ _ _ _ _ __ _ -·---------- $1,005,511 7 __ ~r~tructure Access Charge __ _ _ __ ---- 8 I Tr~nsportation Fixe_<!._Charg:._ NIA
9 Total Annual Proje~t:d s:_ost __ _ ------+-----$5,199,971 10 ------ 11 Projected Cost of SDCWA Usage Rates Paid by Poway -12---SDCWA M&I-Melded Untr~t~ Y,ate -_ -__ ~~--~--~--$11,]4~33 _' 13 Transportation Variable Charge $2.013,064
14 -Tota!Var-i;bk Cost ---------------$13,753,997
----------------------
15 ---
16 1 Total Projected SDCWA Costs Paid by Poway $18,953,968 1 ~; : Proje~ted 202~ Billed Consumptio~(ccf) (1) ---I 3~941,112 :
19 Unit Cost of Service J$/ccf) $4.81 I
20 21
j Required 2025 Pass-Through Increase
(I) ccf= one hundred cubic feet
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$926,718 ---
$738.006
$5,772,558
$12,647,474 -----$1.799.994
$14,447,467
$20,220,025
3,941,112-_
1 ,
$5.13
$0.32 I
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Proposed 2025 Water Commodity Rates
3 The wholesale water supply rates are included uniformly in each commodity rate. Table 2 shows the proposed 2025 water commodity rates after adding the SDCW A pass-through adjustments (Column D). If billed water consumption is 3,941,112 ccf as originally estimated for 2025, the additional revenue produced by the proposed pass-through adjustments will be approximately $1.27 million which is projected to cover the wholesale cost increases incurred from SDCW A for wholesale water services.

Table 2: Proposed FY 2025 Water Commodity Rates with Pass-Through Adjustments (A) (B) (C) (D)
Adopted 2025 Commodity Proposed 2025 SDCWA Proposed 2025 Commodity Customer Class Rates ($/eel) Pass-Through Adjustment R11tes ($/eel) Single Family Residential
Tier I: 0-20
Tier 2: 21-56
Tier 3: 57+
Multi-Family Residential
[ Landscape I;rigation ~
I Non-Residential
[ City-Potable Usage_ ~
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L
I
$6.40
$7.46
$10.37 ----
$6.56
$9.09 -- -----
$6.97 -----
$6.97
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$6.72
$7.78
$10.69
$6.88
$9.41
$7.29
$7.29

Poway City CouncilOctober 15, 2024

Poway City Council
October 15, 2024