PRESENTATIONS
Special Presentations -
Mach Industries
Agenda Item No. 16 –
VWD Water Rate Study
Presentation
Prepared by:
BARTLE WELLS ASSOCIATES
Victorville Water District
Water Rate Study Presentation – City Council Workshop
June 2, 2026
Study
Highlights
• Annual Rate Revenue – 4%
• Year 1 rates, effective August 1, 2026
• Year 2-5 rates, effective July 1, beginning in 2027
• Mo
ving from two-tier to a single-tier rate
• Paying off the remaining bond debt from Baldy Mesa
W
ater District ($7.255 M)
• Moves approx. $1M into Fund 410 revenue annually
• Update in Personnel Costs for COLA & Fringe for FY27
• New Objection Process
• Allows for objections related to the Prop 218 process • Separate from Protest Process
2 Capital Improvement
Program
Capital
Improvement
Program
Capital
Improvement
Program
Capital
Improvement
Program
• Upgrades, repairs and replacements needed to maintain sa
fe and reliable operations
• Current year, plus next ten-years capital spending is appr
oximately $76 million
6 Customer Bill Impact
Regional Bill
Comparison
8 Customer Bill
Impacts
9 Customer Bill
Impacts
10 Customer Bill
Impacts
11 Next Steps
1. Mail Proposition 218
Notice
2. Collect and Count Protests
3. Collect and respond to
objections
4. Hold Public Hearing
5. If no majority protest,
implemen
t new water rates
12 Other Water Rate
Study Elements
Proposed
Water Rates
14 Current
FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 Fixed Service Charges
3/4 inch $25.81 $24.58 $25.56 $26.59 $27.65 $28.76
1 inch $39.48 $35.74 $37.17 $38.66 $40.20 $41.81
1.5 inch $73.66 $63.64 $66.19 $68.83 $71.59 $74.45
2 inch $114.67 $97.12 $101.00 $105.04 $109.25 $113.62
3 inch $224.03 $286.84 $298.31 $310.25 $322.66 $335.56
4 inch $347.06 $498.88 $518.84 $539.59 $561.17 $583.62
6 inch $688.81 $789.04 $820.60 $853.43 $887.56 $923.07
8 inch $1,919.12 $1,570.24 $1,633.05 $1,698.37 $1,766.31 $1,836.96 10 inch $2,876.03 $2,518.84 $2,619.59 $2,724.38 $2,833.35 $2,946.69 12 inch $2,876.03 $3,076.84 $3,199.91 $3,327.91 $3,461.03 $3,599.47 Consumption Rates (per hcf)
Single-Family Residents (SFR):
Tier 1 (1 - 6 hcf) $0.80
Tier 2 (7+ hcf) $2.44
Uniform Rate (all hcf) $2.28 $2.37 $2.47 $2.56 $2.67
All Other Customers:
Standard Domestic Water (Non SFR) $2.42 $2.28 $2.37 $2.47 $2.56 $2.67 Construction Flow Meter/Intertie $4.01 $3.89 $4.04 $4.21 $4.37 $4.55 Well (Untreated) Water $0.82 $1.65 $1.71 $1.78 $1.85 $1.93 Reclaimed/Recycled Water $1.45 $1.86 $1.93 $2.01 $2.09 $2.18 Fire Fixed Service Charges
1 inch $6.45 $8.49 $8.83 $9.18 $9.55 $9.93
1.5 inch $7.59 $9.14 $9.51 $9.89 $10.28 $10.69
2 inch $8.96 $9.92 $10.32 $10.73 $11.16 $11.60
3 inch $13.30 $14.34 $14.91 $15.51 $16.13 $16.78
4 inch $21.30 $19.28 $20.05 $20.85 $21.69 $22.55
6 inch $41.86 $26.04 $27.08 $28.16 $29.29 $30.46
8 inch $69.28 $44.24 $46.01 $47.85 $49.76 $51.75
10 inch $105.84 $66.34 $68.99 $71.75 $74.62 $77.61
12 inch $105.84 $79.34 $82.51 $85.81 $89.25 $92.82
ProposedMonthly Water Rates
Financial
Drivers
15 Funding O&M Costs of $40 mil/year,
plus estimated cost inflation
Fund CIP Costs of $7 mil/year
average ($76 million overall)
Maintain Sufficient Reserve Funds of
approx. $24 million
Operating and
Maintenance
Costs
16 Average annual cost inflation in FY 2028 through FY 2036 is approximately 3.5%.
Operating & Maintenance Cost Inflation
Cost Inflation Factor FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 General 3.00% 3.00% 3.00% 3.00% 3.00%
None 0.00% 0.00% 0.00% 0.00% 0.00%
General - Travel & Meetings 3.50% 3.50% 3.50% 3.50% 3.50% Labor 4.00% 4.00% 4.00% 4.00% 4.00%
Fuel 5.00% 5.00% 5.00% 5.00% 5.00%
Utilities - Electric/Natural Gas/Sanitation 5.00% 5.00% 5.00% 5.00% 5.00% Utilities - Production Power 7.50% 7.50% 7.50% 7.50% 7.50% R-Cubed Water 4.50% 4.50% 4.50% 4.50% 4.50%
Admin & Bio Assessment
1 10.11% 10.11% 10.11% 10.11% 10.11%
Groundwater Replenishment & Makeup Obligation 4.00% 4.00% 4.00% 4.00% 4.00% Meter Service Installation & Changeouts 4.00% 4.00% 4.00% 4.00% 4.00% HDPP Reimbursement 8.30% 17.79% 17.83% 17.87% 17.91%
1. Admin and Bio Assessment cost inflation is equal to the historical five year average change in cost.
Operating &
Maintenance
Costs by
Organization
18 Summary of Operating Expenses by Organization FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 Budgeted Budgeted Projected Projected Projected Projected 4100030 - WATER-ADMINISTRATION $7,173,361 $7,318,907 $7,736,819 $7,990,140 $8,251,917 $8,522,440 4100030E - WATER ADMINISTRATION EDD 62,500 111,775 103,579 106,762 110,043 113,426 4100500 - WATER-SUPPLY 16,829,429 17,286,560 18,089,918 18,935,550 19,825,981 20,763,900 4100505 - WATER- SCADA 884,772 1,158,330 947,478 983,459 1,020,825 1,059,630 4100510 - WATER-HD POWER PLANT (116,313) (106,296) (237,216) (398,017) (594,570) (833,858) 4100525 - WATER EFFICIENCY 1,094,284 960,693 994,624 1,029,779 1,066,203 1,103,944 4100530 - WATER-METER SVCS 2,398,700 2,208,358 2,287,037 2,368,578 2,453,089 2,540,681 4100535 - WATER-FIELD SVCS 3,132,738 3,529,368 3,662,744 3,801,246 3,945,074 4,094,436 4100540 - WATER - WID 2 136,987 90,352 93,460 96,680 100,018 103,479 4100541 - WATER - WID 1 297,762 309,525 322,022 335,031 348,575 362,676 4100543 - WATER LINE LOCATING 147,852 199,954 207,898 216,157 224,746 233,676 4100545 - WATER-CUSTOMER SVCS 3,427,747 3,228,648 3,346,644 3,469,150 3,596,338 3,728,389 4100710 - WATER - WW TREATMENT - - - - - - 4101510 - WATER-INFO TECHNOLOGY 235,260 66,585 68,583 70,640 72,759 74,942 4101515 - WATER-IT GIS 192,203 249,462 258,543 267,961 277,729 287,859 4104000 - WATER - CODE ENFORCEMENT 478,937 572,506 595,406 619,222 643,991 669,751 4104500 - WATER-ENGINEERING SVCS 2,306,130 2,269,520 2,357,994 2,449,943 2,545,503 2,644,816 4105001 - WATER ASPHALT 229,652 238,988 248,312 258,001 268,071 278,536 4110020 - WID #2 - NON-OPERATING - - - - - - 4110201 - WID #2 - 98 BALDY MESA COP - - - - - - 4110202 - WID #2 - 06 BALDY MESA COP - - - - - - 4130520 - RECLAIMED WATER 674,032 632,243 654,256 677,065 700,700 725,194 4131510 - REC - INFO TECHNOLOGY 3,099 3,192 3,288 3,386 3,488 3,593 Total Operating Expenses $39,589,132 $40,3 28,670 $41,741,388 $43,280,735 $44,860,482 $46,477,512 Reserve Fund
Targets
• Operating – 90 days of Operating and Maintenance
expenses (net of Water Purchases and High Desert
Power Plant)
• Capital Rehabilitation and Replacement –3 % o f
net assets
• OPEB –$10 million
19 Reserve Fund Targets FYE 2026
Operating $8.06 mil
Capital Rehabilitation & Replacement $4.89 mil
OPEB $10.00 mil
Total $22.95 mil
Proposed
Rate
Adjustments
20 Rate Revenue Increases of 4% per year
Reserve Fund
Projection
21 Rate Revenue Increases of 4% per year
Cash Flow
Analysis
22 Water Cash Flow Projection FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 Projected Demand Growth 1.0% 1.0% 1.0% 1.0% 1.0%
R a t e R e v e n u e I n c r e a s e s 4 . 0 %4 . 0 %4 . 0 %4 . 0 %4 . 0 % Beginning Reserve Balance $44,832,468 $41, 671,504 $32,765,530 $28, 617,478 $27,980,879 $25,661,111 Revenues
Rate Revenue
Current Rate Revenue 33,032,582 $ 33,362,908 $ 33,696,537 $ 34,033,502 $ 34,373,837 $ 34,717,575 $ Revenue from Rate Increases - 1,223,307 2,749,637 4,249,559 5,838,690 7,521,663 Total Revenue Required from Rates 33,032,582$ 34,586,214 $ 36,446,174 $ 38,283,061 $ 40,212,527 $ 42,239,239 $ Non-Rate Revenue
Miscellaneous1 2,867,207$ 2,730,308 $ 2,674,792 $ 2,618,675 $ 2,306,488 $ 2,285,049 $ Interest 2,048,091 948,360 745,678 651,277 636,789 583,996 Other Charges/Fees 2
3,562,400 4,368,338 5,836,650 5,162,302 5,209,130 5,257,181 Total Non-Rate Revenue 8,477,698 $ 8,047,006 $ 9,257,119 $ 8,432,254 $ 8,152,407 $ 8,126,226 $ Total Revenues 41,510,279 $ 42,633,220 $ 45,703,293 $ 46,715,315 $ 48,364,935 $ 50,365,465 $ Total Expenses
Operating Expenses
Total Operating Expenses 38,912,000 $ 39,693,235 $ 41,083,845 $ 42,600,284 $ 44,156,294 $ 45,748,725 $ Non-Operating Expenses
Rate Funded Capital 5, 759,244 11,845,959 8,767,500 4,751,630 6,528,409 4,653,000 Total Expenses 44,671,244 $ 51,539,194 $ 49,851,345 $ 47,351,914 $ 50,684,703 $ 50,401,725 $ Revenues Less Expenses (3,160,965) $ (8,905,974) $ (4,148,052) $ (636,599) $ (2,319,768)$ (36,260) $ Ending Reserve Balance 41,671,504 $ 32,765,530 $ 28,617,478 $ 27,980,879 $ 25,661,111 $ 25,624,852 $ Reserve Fund Target 22,952,614 23,309,703 23,522,004 23,741,707 24,150,448 24,465,660
1. Miscellaneous revenue is primarily from a repayment by the City of Victorville's Sewer fund to the Water District and approximately $40,000 in other miscellaneous revenues.
2. Other Charges/Fees consists of revenue from various sources such as permit and plan check fees, penalty/late fees, meter installations, service calls, etc. Details for all sources of revenue can be found in the Appendix pages 4-6.
Summary of
Revenue
Requirement
23 Cost Allocation
Category
FY 2026/27
Revenue
Reqt. Units Unit Cost
Commodity $20,313,669 8,893,551 $2.28 HCF of Domestic water use Capacity 9,857,915 49,080 $16.74 Equivalent Meters/month Customer 3,642,758 38,711 $7.84 Customers/month
Recycled 545,591 293,193 $1.86 HCF of Recycled water use Fire 226,281 48,362 $0.39 Equivalent Meters/month
Total $34,586,214
Units of Measure
Water Rate
Structure
Changes
24 • Changes to Volumetric Rate
• Eliminate Two-Tiered Volumetric Rate for Single-
Family Residential Customers
• Implement Uniform Volumetric Rate for all Domestic
Water Users (SFR, MFR, Commercial, Industrial, etc.)
• Maintain Uniform Volumetric Rate that Varies by
User Type for Wells, Reclaimed and Construction
• Changes to Fixed Meter Charges
• Update Capacity Component of Fixed Charge to be
Scaled Based on Capacity of Updated Meter Types (i.e.
ultrasonic meters for 3 inch and larger)
• Update Cost of Service Basis for Capacity and Customer Component to New Revenue Requirement
Customer Bill
Impacts
25 Customer Bill
Impacts
26 Capital Improvement Program Projects
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035 FY 2036 FY 2026 Budgeted CIP
WATER ADMIN
New Door for Access to City Hall $6,631
SUBTOTAL: WATER ADMIN 6,631
CUSTOMER SERVICE
Cubicles 64,093
SUBTOTAL: CUSTOMER SERVICE 64,093
WATER PRODUCTION
Replace Chlorine Truck (27747) 26,042
Replace Chlorine Truck (27748) 26,042
New Forklift 49,707
Well 203 - Block Wall/Electric Gate 167,245
La Mesa Treatment Plant - Block Wall/Electric Gate Well 20 7 422,250
El Evado Treatment Plant - Block Wall/Electric Gate 617,687 Coat Concrete El Evado 75,000
Spare Flow Meters 37,303
Spare Motor for Turnout 6 50,000
Spare Booster Motor for White Rd 10,000
Upgrade & Outfit Booster Station at 395 119,188
D2 Roof 85,250
John Deere 650 P-Tier Dozer 80,668
White Rd Roofing 28,303
La Mesa Roofing 28,600
Burning Tree Roofing 17,359
Camelback Roofing 17,359
395 Booster Station Roof 28,303
New 30" Butterfly Valve at El Evado TP 50,000
SUBTOTAL: WATER PRODUCTION 1,936,306
Project Type/Description
Capital Improvement Program Projects
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035 FY 2036 FY 2026 Budgeted CIP, continued
SCADA
Radio Replacements 618,321
Scada Gas Pipeline 2,550
New Vehicle for Electrical Technician Assistant 7,218
SUBTOTAL: SCADA 628,089
METER SERVICES
Advance Metering Inrastrcture (AMI) 1,004,101
Tow Behind Vactor Trailer 69,013
SUBTOTAL: METER SERVICES 1,073,114
FIELD SERVICES
Replacement Vehicle 63207 156,693
Replacement Vehicle 23409 116,037
Turnout #5 - Amyethst/ Le Mesa 110,662
Replace V#87088 52,551
Leak Detection Sounding Equipment 20,986
SUBTOTAL: FIELD SERVICES 456,929
ENGINEERING DEPARTMENT
Svc Pipeline Rpmt, Areas 4, 5, 8, 9, 10, 11, & 12 Design Cont r 225,000
Service Pipeline Replacement, Area 7 1,312,211
Mojave Drive Water Infrastructure 94
Ridgecrest Rd Pavement BV to Pahute 24,904
Roy Rodgers Pavement Amargosa to I-15 12,598
Turnout #5 - Amyethst/ Le Mesa 592
Cannon Colorwave Plotter 18,685
SUBTOTAL: ENGINEERING DEPARTMENT 1,594,083
S U B T O T A L : 2 0 2 6 B U D G E T E D C I P $ 5 , 7 5 9 , 2 4 4 $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0 $ 0 Project Type/Description
Capital Improvement Program Projects
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035 FY 2036 FY 2026 CIP ROLLOVER
City Hall Iron Fence 252,800
Well 109 Replacement 1,200,000 1,200,000
AMI Project Completion 200,000
Supply- Generators 776,250
Block Wall - Well 201 164,000
Block Walls - Wells 109, 128 & 131 616,000
Block Wall - Hesperia Rd Yard 75,000
Pipelines - Hesperia Rd Yard 100,000
Large Meter Replacements 150,000
Replace Flowmeters - El Evado TP 80,000
Spare Air Scour Motor - El Evado TP 50,000
Pipe Coating - R3 Turnouts 3 & 6 50,000
SCADA Hardware Upgrade 172,243
Equipment/Vehicles 390,259
SUBTOTAL: FY26 CIP ROLLOVER 4,276,552 1,200,000
Project Type/Description
Capital Improvement Program Projects
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035 FY 2036 FY 2027 BUDGETED CIP
Pipelines - Mojave Dr 341,907
Block Wall - 395 Booster Station 200,000 200,000
Block Wall - Well 123 95,000 95,000
Block Wall Well - 127 137,500 137,500
Pump to Waste - Balsam TP 190,000
Auma Valve Actuators 80,000
Cl2 Analyzing Equipment 50,000
Data Logger 17,000
Ground Penetrating Radar 35,000
Equipment/Vehicles 1,240,000
ROW/Utility Relocations 50,000
SUBTOTAL: FY27 BUDGETED CIP 2,436,407 432,500
Grand Total: All CIP Costs $5,759,244 $11,845,959 $8,767,500 $4,751,630 $6,528,409 $4,653,000 $8,041,492 $6,765,837 $6,650,912 $5,910,73 9 $6,221,341 Project Type/Description
Capital Improvement Program Projects
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 FY 2031 FY 2032 FY 2033 FY 2034 FY 2035 FY 2036 2026 WATER MASTER PLAN CIP
Pipelines - Mojave Dr (Phase 3) 125,000
Pipelines - BVR Pvmt Imp Project 15,000
Rezoning
Supply - Generators 246,500 254,000 261,500
Reservoirs (R&R; 2-3 per yr) 4,035,000 4,081,000 1,912,000 1,827,000 1,342,000 1,530,000 17,000 Reservoirs - Annual Maintenance 68,000 70,000 72,000 74,000 76,000 78,000 81,000 83,000 85,000 88,000 Wells (R&R; 2-3 per yr) 120,000 153,000 186,000 219,000 252,000 388,000 421,000 457,000 496,000 535,000 Booster Stations (R&R) 210,000 217,000 224,000 245,000 252,000 259,000 275,000 Meter Replacements (small) 1,312,000 1,351,000 1,392,000 1,433,000 1,476,000 1,521,000 1,566,000 Meter Replacements (large) 41,000 44,000 47,000 49,000
Service Line Replacements (350/yr) 700,000 721,000 742,630 764,909 0 811,492 835,837 860,912 886,739 913,341 Site Security Upgrades 432,500 756,000 0 2,204,000 2,336,000 2,036,000 1,447,000 903,000 Equipment/Vehicles 889,000 916,000 944,000 972,000 1,001,000 1,031,000 1,062,000 1,094,000 1,127,000 ROW/Utility Relocations 52,000 54,000 55,000 57,000 58,000 60,000 62,000 64,000 66,000 SCADA 258,000 266,000 274,000 282,000 290,000 299,000 308,000 317,000 327,000 Planning Documents 321,000 372,000
SUBTOTAL: 2026 WATER MASTER PLAN CIP 5,133,000 7,135,000 4,751,630 6,528,409 4,653,000 8,041,492 6,765,837 6,650,912 5,910,739 6,221,341 Project Type/Description
Summary
The District has historically been proactive
with consistent gradual annual rate
increases
Continued rate increases are needed to
support rising operating and maintenance
costs, and capital investment needs
Rate Structure Modifications are
Recommended to Remain In-Line with
Prop. 218
32 BARTLE WELLS ASSOCIATES
Questions and Comments