Poway council adopts five-year water, recycled-water and wastewater rates after public hearing; majority protest not reached

The Poway City Council voted 3-1 on Jan. 20 to adopt resolutions establishing new five-year rates for water, recycled water and wastewater, after a public hearing in which staff described the primary cost drivers and community members urged scrutiny and fairness.

Director of Finance Greg Schmollinger told the council the largest drivers for the water enterprise are wholesale water purchases and pumping (energy) costs, which together account for a little more than 60% of water operating costs. He said the proposed structure includes a year‑one combined adjustment that staff quantified as about 9.9% (roughly 4.1% attributable to city costs and about 5.8% from increased imported-water costs), with a not-to-exceed 4% annual adjustment in years two through five for water and 3% in later years for wastewater.

The council opened the hearing after staff noted that pass-through provisions (authorizing the automatic pass-through of wholesale cost changes) are allowed under California law and would be included in the recommended five-year rate structure. Schmollinger also said the city is shifting to a uniform volumetric rate following recent court rulings that have raised questions about tiered rates.

Members of the public spoke at the hearing. Jim Bunner expressed concerns about fairness for residents in mobile-home parks and urged the council to consider how the protest process counts voters. Yuri Bolden said many voters who approved Proposition 218 in 1996 share responsibility for the constraints the city now faces and urged callers to contact statewide advocates about reform. The city clerk announced that 49 valid written protests had been received by the noon deadline and that 10 additional protests arrived late (59 total), which staff said did not meet the threshold for a majority protest (staff stated 7,974 valid protests would be required).

Deputy Mayor Maeda proposed a friendly amendment to reduce the bimonthly meter service charge for single-family customers by 25% and increase the commodity per-unit charge by 12% while maintaining the overall annual revenue requirement; the amendment did not receive a second. Maeda said she was concerned about impacts on low‑volume and low‑income customers. Schmollinger and other staff cautioned that state law and recent legal decisions largely constrain how rates may be structured and noted limits on using rate revenue to subsidize one customer class from another.

With the lack of a majority protest, Councilmember deHoff moved — and Councilmember Pikes seconded — the resolutions establishing the new water, recycled-water and wastewater rates. The roll-call vote was deHoff: aye; Pikes: aye; Deputy Mayor Maeda: no; Mayor Voss: aye. The council and staff said the adopted rates would be effective for bills mailed after the meeting (staff indicated they would go into effect beginning the next billing cycle). The council also noted the notice rates are not-to-exceed values and staff may recommend smaller increases if revenues or costs permit.

Next steps: the adopted resolutions take effect as described by staff; council members asked staff to continue outreach about available utility-assistance resources and to provide any further legal clarifications about rate-design constraints.