The City of San Luis Obispo voted to move forward with a proposed plan that will increase water service rates for users over the next two years.
The vote was 5-0 in favor.
“You gotta have water,” councilmember Andrea “Andy” Pease said during the meeting prior to voting in favor.
Water rates will increase by 8.5% in 2023-2024 and an additional 7.5% in 2024-2025.
The first rate increase will be effective July 1, 2023.
The rate increases proposed by the Utilities Department of San Luis Obispo — and accepted by City Council — are being driven in part by costs associated with water delivery and electricity use as well as the cost of chemicals used to treat water, according to information provided in a presentation by the department.
The department estimates that it will spend an additional $300,000 on chemicals and $1.5 million on electricity in fiscal year ’23-’24 than in the prior fiscal year.
Council could not have adopted the proposed rates if 8,265 valid protests were filed, which would have met the legally sufficient 50%-plus-1 threshold. Fewer than 1,300 valid protests were filed.
The 5-0 vote also approved the proposed sewer rate increases, which will be 4% in both fiscal years '23-'24 and '24-'25.
The vote in favor adopted the recommendation by consulting company HDR Engineering, Inc., which put together the draft report for the city’s water rate study.
The department noted that increased rainfall and water supply do not result in reduced costs for water users as more than 85% of the costs to provide water and sewer are fixed. “Macroeconomic supply-chain issues and inflation have had significant impacts on the cost of delivering water and sewer services,” the department presentation said.
City Council members acknowledged their desire to review water rate-structure changes for the ’25-’27 two-year financial plan.
The Utilities Department noted its acquisition of over $20 million in grants to improve water and sewer usage for customers, which has greatly reduced the financial burden for city residents.
The City of San Luis Obispo offers a financial assistance program, called the Customer Assistance Program (CAP), that can aid with customers' monthly water and sewer bills. Eligible participants can receive a 15% discount on each monthly bill.
Learn more about the proposed increases in the City Council's Agenda Report.
