San Mateo County staff propose five-year rate increases for CSA 11 to address operating shortfall

San Mateo County Department of Public Works staff on Oct. 29 laid out a proposed multi-year rate plan for County Service Area 11, saying the small special district’s existing charges do not cover routine operations and that its fund reserve was only $12,897 at the end of the last fiscal year.

Christophe Lise, deputy director with the Department of Public Works, said the district’s current revenue—derived only from water sales, meter service charges and connection fees—falls short of expenses. “The current rates do not adequately support the system operation and maintenance activities and our fund reserve as of the end of last fiscal year… is only at $12,897,” Lise said. He told attendees expenses for the current fiscal year are projected near $130,000 while revenues are about $95,500.

Why it matters: CSA 11 serves roughly 102 connections and does not receive property-tax revenue; staff said the mismatch between rising costs and flat revenue will require either rate increases or borrowing to balance the books. Without changes, staff projected cumulative negative fund balances across a five-year horizon.

What staff proposed: DPW presented a rate schedule intended to bring CSA 11 to a sustainable footing over five years. The department described the plan as a uniform annual percentage increase intended to restore a minimum fund reserve target (about $160,000) and to repay an outstanding loan incurred in 2011. Department materials compared the current front‑loaded proposal from earlier this year with the revised approach, which spreads increases more evenly to improve predictability for ratepayers.

On the size of the annual increase, staff used slightly different numbers in the meeting: at one point Lise described a “22% increase per year over the next 5 fiscal years,” while later remarks referred to a 20% annual rise. DPW said it will post the full rate schedule and supporting tables on its public website; the department advised residents that the published schedule will be the authoritative source for exact percentages and customer impacts.

Customer impacts: Using a 5/8‑inch meter and 10 monthly units as an example, staff said a typical CSA 11 bill that is currently about $54.90 per month would rise to roughly $66.96 in year one under the presented model. The department also reviewed tier bands (Tier 1: 0–11 units; Tier 2: 12–25; Tier 3: 26–40; Tier 4: >40) and noted the majority of CSA 11 accounts are in Tier 1.

Alternatives and next steps: Staff said other options were considered—continuing county operation, contracting with a private operator (which would require a permit transfer), consolidation or attempted acquisition by a nearby utility—but concluded that for CSA 11 none of those alternatives currently produced clear economies of scale. The department has scheduled a Board of Supervisors hearing for March 24; Prop 218 notices are planned to be mailed about 45 days beforehand. Staff also offered to hold a follow-up public meeting (in‑person or virtual) to gather more input.

Documents and transparency: Residents asked for the underlying Todd Engineers reports and for more detailed operating expense histories; DPW said it would post these documents and consider multi‑year expense/income tables online.

What’s next: The Department of Public Works will take the record to the Board of Supervisors to set the hearing date in mid‑January as planned and will publish the final rate tables and explanatory documents on the county website prior to the March 24 hearing.