Citizens Gather to Express Anger Over New Water Rate Plan

Tensions ran high when more than 60 residents gathered at the Wednesday night to express their outrage over the district's proposed move to a water budget-based rate plan. This proposal—should it be adopted—will move the district from a flat rate for water to a rate plan based on users' efficiency.

The Details of the Plan

Every customer will be allotted a customized amount of water to meet their specific needs. There will be both an indoor amount allotted—a straightforward 65 gallons per person per day—and an outdoor allotment, which is where the formula becomes much more complicated. 

The outdoor amount amount is calculated using a survey the district conducted of residents' lot size and area that is landscaped, weather data pertaining to that specific area and plant types. For this reason, there is no standard allotment per square footage and customers will need to go to the MNWD website to see what their individual plan will include.

Furthermore, the outdoor allotment will vary by season as water evaporation rates are higher in the summer time than in winter and the need to water landscapes in greater. Businesses' budgets will be based on a three-year rolling average of water use. If a home or business has a legitimate need for more water, steps will be provided by the district to adjust the water budget for that customer. 

Why is the District Proposing this Plan?

Director of Customer Service at Moulton Niguel Water District Charles Roy said that this new plan is designed to be more fair for to customers.

"Water-budget-based rates would allow the district to reward customers who use water wisely with the lowest possible rates and apply the higher rates only to customers who exceed their budgeted water allocation," Roy said. 

"We have a broad diversity of home sizes throughout our community," he said. "Customers with large lots obviously need more water than those in smaller homes or condos, and this proposed system would account for that. It would treat customers fairly by providing each a customized water budget designed to meet their specific needs, which means that no matter the size of your family or home, you should be able to receive the water you need at the lowest possible price."

'You're Lying to Us'

Resident Charles Manouser complained that there is already a rate increase scheduled for June, and that the new rate plan—which is scheduled to take effect in July—was basically just another rate increase.

"The June increase will raise our current rates by 16 percent," Manouser said.  "Why do we need another rate increase when this is already set to take place?"

A member of the audience shouted out "good question" while another member said "and another increase in the sewer fees."

"What we are considering putting into effect in July is a restructuring that is not intended to be an increase," said Larry McKenney, water board president. "It is intended to be districtwide and revenue neutral. It's possible that your bills may go up. It's also possible that your bills may go down."

This produced expressions of disgust from the audience, and laughter including the cat call "play of words."

"It says in your literature that customers who use their water efficiently will be billed at lower rates, but by all calculations our bill is going up. You're lying to us," said John Palazzolo. "Also, regarding your comment about balancing the budget, I just wonder if that has anything to do with your pensions and retirements."

The audience applauded and hooted. Overheard in the background: "What are our options?" "Recall," replied another voice.

"All residents will see at least a small increase in their water bills," Roy said.

He said in a  that "those in the lowest tier will see a very minor increase in their water bill. I think it's around 3 cents per billing unit."

Accusations of 'Gaming the System'

Homeowner John Emmel is concerned about how accurate the data are and that the district intended to set the allocations low in order to force residents to pay higher costs. 

"I was given 300 square feet for my land. In reality, I have a single-family home—not attached.  You came out and measured my land and it went from an estimated 300 square feet to 2,200 square feet. It appears from a personal standpoint that there is a gaming aspect to making the water budget low so that we will have to pay the higher rate," Emmel said.

McKenney responded, "I can assure you that there were no efforts to game the system. There will be a lot of comments tonight about factual errors. I just want to re-emphasize that we do have a process that will be in place where if you have questions about the accuracy of your allocation, you'll always be able to come in and talk with the department about that. We are perfectly willing to go out and verify numbers."

'Let's Just Stick it to the Other Guy'

Resident John Chevalier is concerned over fairness and future ramifications.

"You said that 'all you folks will not be affected by this, but it will be the wasteful guy.' That's a real dangerous thing to do and strikes me as a way of saying, 'let's just stick it to the other guy.' We are the other guy. We may be OK today, but tomorrow, we may be the one who is 'getting it stuck to.'"

Break Down

The customers whose usage remains within their budget allowance will receive an efficiency reward by being billed at a lower rate. Those who exceed their budgets will be billed at higher rates according to the following plan, with the additional revenues used to fund local conservation programs.

Tier 1, the Conservation Tier, will cost $1.38 per 748 gallons. 

Tier 2, the Efficient Tier, will cost $1.54 per 748 gallons. 

Tier 3, the Inefficient Tier will cost $2.75 per 748 gallons and will be billed to those who exceed their total water budget by up to 25 percent.

Tier 4, the Excessive Tier will cost $5.51 per 748 gallons and will be billed to those who exceed their total water budget by up to 50 percent.

Tier 5, the Wasteful Tier, will cost $11.02 per 748 gallons and will be billed to those who exceed their water budget by more than 50 percent.

According to Roy, the difference in rates between Tier 1 and Tier 2 are not meant to penalize for lack of efficiency.

"Tier 1 is a customized amount for indoor use," he said, "and Tier 2 is a customized amount for outdoor use. Customers who stay within their budgets would pay the lower Tier 1 and Tier 2 rates. Beyond these tiers, progressively more water use would move a customer to Tier 3, which would be billed at a higher rate, then to Tier 4, with a higher rate still. Only those who most flagrantly exceed their water budget—by a factor of 50 percent or more—would move to Tier 5. So, as with our current rate structure, the more water you use, the higher you move through the tiers."    

This new structure will also mean an end to the three-day-a-week watering plans and will allow customers greater flexibility to water when they choose. But all customers can expect a small increase in their water bills according to the new plan—even at the lowest billing tier. 

Overall Customer Response to the Plan

According to Roy, despite the anger expressed at last night's meeting, overall response to the plan has been positive.

"MNWD serves approximately 167,000 customers across portions of five cities," Roy said. "We have spoken with hundreds of customers over the past several months about water-budget-based rates, and the vast majority of those are supportive of the proposal. We understand the concerns raised at last night’s hearing, and we pledge to continue working with all of our customers to answer their questions and educate them on the benefits our proposal affords our them."