ENCINITAS — As a result of continuing rate increases by the region’s water wholesalers, Olivenhain Municipal Water District customers will see a rate increase of 8.85 percent effective April 1.
OMWD’s rate increase is driven by increased purchased water wholesale costs of 14.7 percent, which was effective Jan. 1. To meet its demand, OMWD must buy imported water from the San Diego County Water Authority.
At their Feb. 9 meeting, OMWD’s board of directors approved an 8.85 percent rate increase, which was lower than the staff’s recommendation of 9 percent, directing staff to transfer additional funds from OMWD’s Rate Stabilization Fund to mitigate the impact of rising wholesale water costs.
“We understand that times are still tough for many of our customers, and that it is just as difficult for them to pay higher water bills as it is for us. Drawing from our reserves is not a decision we take lightly, but in this case, it’s a necessary step for us to take to shield our customers from the full brunt of wholesale cost increases,” OMWD’s Board Treasurer, Mark Muir, said.
The San Diego County Water Authority’s Board of Directors adopted its 14.7 percent increase in treated water wholesale cost at their June 24, 2010, meeting despite a rate protest from OMWD’s board of directors opposing the wholesale rate increase.
Claude A. “Bud” Lewis, then chairman of SDCWA’s board said, in a news release: “The costs to provide our region with a safe and reliable water supply are continuing to rise, but the Water Authority is working aggressively to mitigate these rising costs and protect the interest of our member agencies and their rate payers.”
SDCWA has justified the 14.7 percent wholesale cost increase for 2011 by citing rising costs to purchase and deliver imported water to the San Diego region as well as rising costs to operate, maintain, and finance the region’s water system to improve long-term water reliability for the region.
Steps have been taken by OMWD to mitigate wholesale water cost increases for 2011, including drawing from its Rate Stabilization Fund to offset the impact of anticipated reduced sales in Fiscal Year 2011 due to wet weather conditions, a reduction in capital expenditures, and continuous cost containment efforts through the “Holding the Line” program. OMWD remains committed to minimizing operating costs and keeping rates reasonable for its customers, even as wholesale rates have jumped significantly. Following the most recent increase, OMWD’s rates remain among the lowest third of water agencies countywide.