Salinas Council OKs start of Prop. 218 process to raise sewer rates to fund $115M in repairs

The Salinas City Council voted 6–1 on March 11 to begin the Proposition 218 public hearing process to increase sanitary sewer rates, selecting the finance committee’s recommended scenario that starts at $16.35 per equivalent dwelling unit (EDU) with a 2% annual escalator.

The action starts the formal Prop. 218 noticing and hearing timeline; staff said the council will be asked on April 8 to authorize the Prop. 218 process and staff expects to set a public hearing on June 3 with rates proposed to take effect July 1 if approved. Councilmember Sandoval cast the lone no vote.

Why it matters: City staff and outside consultants told the council the sewer enterprise fund is underfunded after more than a decade without substantive rate increases. The sewer master plan and a new rate study identify roughly $115 million in capital needs over a 10‑year planning window to address maintenance, lift‑station upgrades and upsizing to serve future growth. Finance staff said the fund faces a more than $400,000 shortfall this fiscal year and that credit rating agencies have placed the fund on watch; continued weakness could increase borrowing costs.

Andrea Ress, the financial consultant from DTA, summarized the rate model for council and framed two scenarios staff tested: a lower…