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District financial model adds another 7.5% rate year; staff estimates ~$350 annual tax debt for typical meter under updated capital plan
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Summary
Finance staff revised baseline demand down, adjusted expense and capital assumptions, and recommended adding a third year of 7.5% rate increases (7.5%/7.5%/4% sequence). Under updated AWPF numbers, staff estimated a roughly $350 annual property‑tax debt for a 3/4‑inch account (about $30/month).
District finance staff presented an updated three‑year rate outlook that incorporates the higher AWPF capital costs and recent revenue experience.
Maisel (finance presenter) said the prior baseline demand assumption of about 4,000 acre‑feet has been revised to about 3,800 acre‑feet after recent actuals were notably lower. That lower demand, combined with higher projected capital costs for the AWPF and some higher operating expenses, led staff to add one more year of a 7.5% rate increase to the previously planned schedule. The three‑year sequence in the updated model is 7.5%, 7.5%, then 4%.
Maisel cautioned that the example customer numbers shown in the presentation were rounded and that the final rate design (tier structure, meter sizes and drought surcharges) has not been adopted. In a demonstration example, a modest single‑family user’s monthly water bill was estimated to rise from roughly $120 to $140 under the presented scenario. Maisel also described an approach adopted previously to put CAP debt on property tax bills; under the updated capital scenario staff estimated that debt for a 3/4‑inch user would be about $350 per year (roughly $30/month), though the district has not finalized the structure.
Directors debated whether CAP debt should be placed primarily on property taxes as a fixed charge (which spreads the cost across parcels) or on water bills as part of operating charges (which makes the cost more visible on monthly statements). Several board members urged clearer customer communication to avoid confusion if charges are split across tax and water bills.
Staff said the projected district operating budget could rise toward roughly $24,000,000 by 2029 under the current scenarios including the AWPF capital program, and that staff will return with refined bill impacts once funding paths and final design choices are clearer.
What’s next: staff will refine the rate model using updated AWPF capital figures and funding clarifications and present a proposed rates and charges package for formal adoption in a future board meeting.
