San Diego City water rates could increase over 16 percent by 201 - CBS News 8 - San Diego, CA News Station - KFMB Channel 8

San Diego City water rates could increase over 16 percent by 2016

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SAN DIEGO (CNS) - The San Diego County Taxpayers Association gave its blessing Wednesday to the city of San Diego's plan to raise water rates by 9.8 percent in January, and an additional 6.9 percent next July 1.

The proposed increases are based on a cost of service study that projects rising expenses in the future.

"The city's Public Utilities Department has made a solid case for its rate increase, including demonstrating they're using ratepayer dollars more efficiently," said Theresa Andrews, interim president and CEO of the SDCTA.

Department officials said they're faced with higher costs for imported water, and water from the desalination plant in Carlsbad that's coming online soon is also expected to be more expensive. At the same time, departmental revenues are falling because customers have cut back on consumption -- as requested by city and state officials -- in response to the drought.

The SDCTA Board of Directors said the rate increase request was justifiable, as was a plan to hike rates for recycled water, which is largely used by commercial buildings, hospitals and schools.

Halla Razak, the public utilities director, said the department could fall behind on debt service if the rates aren't raised, which would look bad to credit agencies and maybe increase the cost of future infrastructure projects.

A residential customer whose monthly bill is now around $36 would see a hike to a little over $39, according to a city report.

The department's proposal also foresees possible rate hikes in 2017, 2018 and 2019, based on projections of future costs for imported water, which makes up 85 percent of the city's total.

The City Council is scheduled to hold a public hearing on the rates, and possibly make a decision, on Nov. 17. Notices of the public hearing have been mailed to customers.

The council last voted to raise water rates in November 2013, when the hike was more than 7 percent. However, a department presentation says the average monthly bill of $70.81 is below the average of the various water districts in San Diego County, which is just over $78.

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