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Cerritos council adopts rate study, directs $40 bimonthly low‑income discount and sets Prop. 218 hearing
Summary
After a staff presentation showing multi‑million‑dollar general‑fund subsidies for water and sewer, the Cerritos City Council voted 5–0 to adopt the 2025 Water and Sewer Rate Study, direct staff to implement a bimonthly $40 low‑income assistance discount, and set a Proposition 218 hearing for Jan. 26, 2026.
CERRITOS, Calif. — The Cerritos City Council voted unanimously Oct. 27 to adopt the 2025 Water and Sewer Rate Study and to direct staff to implement a proposed low‑income assistance program with a fixed $40 bimonthly discount, setting a Proposition 218 public hearing for Jan. 26, 2026.
City staff told the council the city has relied on substantial General Fund transfers to support its utilities, including a $24.3 million loan written off in October 2023 and an estimated additional $8.9 million in transfers by the end of the current fiscal year. Alvin Papa, the city’s director of public works, said the study recommends a five‑year rate schedule designed to return the utility funds to self‑sufficiency by July 2029.
“The primary objective of the rate study is to develop a 5‑year rate schedule that enables the water and sewer funds to operate independently without ongoing reliance on general fund support,” Papa said during his presentation. He highlighted that maintaining the status quo would require roughly $68.9 million of General Fund support for water over five years and $12.1 million for sewer; the proposed scenarios would reduce those needs substantially.
A central driver of the cost projections is an identified capital project: treatment for Well C‑4, which Papa described as “our largest well producer” and estimated at about $16 million for treatment and upgrades. He said the study focused on critical capital projects and that staff would pursue value engineering and reserve funding if construction bids exceeded estimates.
On affordability, staff recommended modeling an assistance program on Southern California Edison’s CARE structure but using a flat, fixed discount rather than a percentage. The report used a conservative proxy of about 2,300 eligible households and presented a range of discount options from $0 to $40 bimonthly. Councilmember Mark Pulido moved to implement a program at the $40 level and to adopt the study and set the Prop. 218 hearing; Mayor Pro Tem Linda Johnson seconded the motion. The council approved the motion 5–0.
City Manager Robert Lopez told the council staff will finalize proposed rate schedules, prepare required Prop. 218 notices, and return with a refined low‑income program framework if the council wishes to proceed with implementation. If the council proceeds at the recommended schedule, staff said new rates could take effect February 2026, with annual adjustments through 2030.
What happens next: staff will finalize the rate schedules, prepare Prop. 218 notices for affected property owners and hold the public hearing Jan. 26, 2026. The council’s direction on the low‑income discount will be folded into budget planning for the coming fiscal year.
Votes and motions: The motion to implement a $40 bimonthly low‑income discount, waive full reading and adopt the resolution approving the 2025 rate study and to set the Prop. 218 public hearing for Jan. 26, 2026 was moved by Councilmember Mark Pulido, seconded by Mayor Pro Tem Linda Johnson and passed 5–0.
