Millbrae council adopts five-year water rate plan after public hearing

The Millbrae City Council on June 10 adopted a proposed five‑year water rate schedule that would raise customer charges by roughly 7% annually over five years and authorize a wholesale-rate passthrough to cover any San Francisco Public Utilities Commission (SFPUC) increases beyond projected levels.

The action followed a detailed presentation by the city's finance staff and consultant on the utility's capital needs, a multi-hour public hearing during which residents raised concerns about bills and meter reads, and questions from council members about alternatives and fiscal safeguards.

City Finance Director Mike Sung and consultant Alex Handler of Bartel & Wells told the council the utility faces three main pressures: large planned capital projects to replace aging pipelines and storage tanks, continuing wholesale cost increases from the SFPUC, and general inflation in operating costs. The staff presentation said the city needs about $5 million per year in current dollars to keep up with infrastructure needs and recommended smaller, steady increases (7% per year) instead of larger, infrequent hikes.

Handler said the proposed rate package includes two parts: a fixed monthly charge tied to meter size and a volumetric usage charge. He said most residential customers pay the three‑quarter‑inch meter fixed charge (currently about $30 monthly) plus a usage charge calculated per 100 cubic feet (CCF). The consultant said the current usage charge is $13.47 per CCF and that the SFPUC's wholesale rate is expected to rise toward about $7 per CCF over the next five years.

Residents who spoke at the hearing called for clearer billing, asked why meter readings sometimes involve multiple staff, and urged the council to pursue grants for large projects such as the LaPrenda tank retrofit. Several commenters — including an owner of a 55‑unit building and multiple single‑home ratepayers — said recent bills are causing financial strain and asked staff to review individual accounts for errors or misapplied charges. One speaker urged the council to consider smart meters or remote reads to reduce field costs over time.

Council members pressed staff on alternatives. Handler said lowering increases to 5–6% is possible but would require drawing more heavily on reserves and likely mean higher increases later. Council direction included an instruction that staff return with regular reports and that any future changes be revisited annually as conditions and grant opportunities evolve. The council also directed staff to work directly with residents who reported possible billing errors.

The council closed the public hearing and adopted the rate plan. The record shows the council approved the recommendation and the wholesale passthrough authorization; the public hearing closed and the council voted to adopt the rates and the pass‑through. Council also asked for a biannual staff report on revenue, expenditures and whether future increases remain necessary.

The rate study, Prop 218 notices and the consultant's analysis are part of the city record. Under Proposition 218 rules, written protests from property owners can block rate changes if a majority of owners submit them; the consultants said the city had received about 18 written protests at the time of the meeting, compared with 364 in the prior rate cycle.

The council vote recorded on the transcript shows the motion adopted; the city clerk will publish the full vote tally and final ordinance implementing the rates.

Residents with billing questions were urged to contact city finance staff; low‑income customers can apply for a rate discount tied to PG&E CARE eligibility or other assistance programs.

The council noted that large grants (for example, a federal hazard‑mitigation grant discussed for the LaPrenda tank) could change the city's capital funding needs and that any awarded grants would be considered in future budget adjustments.