The City Council is scheduled to consider spending $344,000 on Tuesday to update studies detailing the costs of running San Diego’s water and sewer systems.

Directors of both the Water Department and Metropolitan Wastewater Department requested that the 2003 cost-of-service reports be modernized last month. The completion of the studies, which compare the costs and fees borne by different types of users, would be the next step taken by Mayor Jerry Sanders before proposing a fee increase to pay for upgrades to the water and sewer infrastructure.

Sanders has said that improvements are needed for both systems in order to comply with federal and state regulations. He stated in his State of the City address that fee hikes might be necessary in order to raise the money needed to complete upgrades to pump stations, pipes and treatment plants.

Earlier this year, the mayor released the results of a study that sought to determine whether fraud or abuse was taking place in either department. At the time, a spokesman said the conclusion that no foul play existed would help bolster the mayor’s case for higher rates if he found them necessary.

Another interesting tidbit about the studies is their place in the city’s investigations. The council in 2002 decided to keep private a cost-of-service study that demonstrated that residents’ sewer bills were subsidizing large industrial users. The known subsidy to big business jeopardized about $265 million in state grants, and the decision to not disclose that practice led to accusations of securities fraud by consultants at Kroll Inc. It has also sparked investigations by the SEC and Justice Department, who subpoenaed information relating to the council’s decision.

Tuesday’s meeting will be cut short so that council members can attend the funeral of George Stevens, who died Oct. 16. The council may postpone its decision to a later date.


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