Water rate hikes looming in Scotts Valley

Residential and business water consumers in Scotts Valley stepped up last year in response to state requests to use less water, reducing consumption by about 24 percent from 2013 levels. The local water district’s target had been 20 percent.
Piret Harmon, general manager of the Scotts Valley Water District, said data from this year shows water use still down about 20 percent from the 2013 levels, indicating local water users are in fact changing their water use habits.
This is good news for water conservation, especially in a state that is facing drought as a persistent, rather than periodic condition.
But the conservation efforts pose challenges for Harmon’s water treatment and delivery system. “Most of our costs are fixed costs, the expense of maintaining the system,” she said. “Lower consumption, based on our current rate structure, means less revenue.”
She said the district has had to dip into its budget reserves to balance its budget, but added this is only a short-term fix. That is why the elected water board for the district is faced with the prospect of water rate increases that could go into effect in early 2017.
The board hired a Southern California engineering firm, Raftelis Financial Consultants, to undertake a zero-base look at the district’s rate structure, especially in light of the new water consumption realities, and the need to invest in systems to ensure adequate water supplies in a drought-filled future.
In addition to the reality of lower consumption, the district is faced with the need to add equipment to improve water quality and modernize its water meters, and a long-term project to replenish groundwater resources by pumping treated wastewater back into aquifer.
That $75,000 study is completed and examines a variety of alternative approaches to rates and rate increases. These were presented a Sept. 15 public meeting at the water district office, and will be evaluated by the board in the next few weeks. Similar meetings could be held in the coming weeks.
The study recommended that the board consider changes from the current rate structure that charges for water based strictly on quantity used, which may be unfair for some users, especially businesses.
The state requires a 45-day public comment period for any water rate increases, so it is likely the water board could decide as early as its Oct. 13 monthly meeting to propose a revised rate structure and rate increases, in order for the new rates to be in effect in January.
The approximately 4,000 home and businesses in the Scotts Valley Water District draw their water from an underground lake called the Santa Margarita Groundwater Basin.