Karen is a licensed civil engineer who lives in Bonita.
The San Diego County Water Authority hopes to leverage last year’s wet winter to switch to a cheaper water supply and sell their more expensive water. Those savings would be passed onto its member agencies in smoothed future rates. Similarly, local water agencies lucky enough to have local reservoirs leveraged last year’s abundant rainfall by budgeting less for wholesale water purchases this fiscal year. This action shielded their customers from the immediate impact of the San Diego County Water Authority’s contentious rate hikes.
New water rates went into effect last month for roughly 200,000 residents and businesses served by the Sweetwater Authority including National City, Bonita, Lincoln Acres, and portions of Chula Vista. Rate structure adjustments will significantly impact the majority of customers. Yet, the Sweetwater Authority presented the amounts and reasons so poorly in its rates notice, I’d be surprised if many ratepayers understand it.
An exhibit, “SD Consumer Price Index vs. SWA Rate Increase,” presented at the public hearing about the rates “for perspective” indicated that a customer would pay 0.5 percent more in 2024 than in 2023. But the incremental amount that a customer will pay in 2024 above the 2023 amount is not 0.5 percent. That exhibit was a gross mischaracterization of the new rates. The truth is for a residence with average bimonthly water use (16 hundred cubic feet,) ratepayers living there will see their water bill increase nearly 7 percent. That same residence’s water bill could be almost 25 percent more in 2026 compared to what it was last year, based upon the rate study. The customer bill impacts do not align with the maximum budget revenue increase, 13 percent over three years, due to those poorly explained rate structure adjustments.
The rate increase also comes at a time when the Sweetwater Authority has a lot of money in their coffers. Ratepayers deserve to know why reserves, which are meant to protect people from shocking rate hikes, were not tapped. The Sweetwater Authority amassed $14 million in surplus revenue over the past five years from their SDCWA Wholesale Water Purchase Charge. This money from ratepayers currently resides in a Rate Stabilization Reserves fund waiting to be spent on water purchases during droughts. They also have unspent money for construction projects that haven’t happened yet. Sweetwater Authority’s “construction carryover” exceeded $18 million in June 2023. This carryover is money from ratepayers waiting to be spent on capital projects. Their Capital Investment Program execution rate has been less than 40 percent for the past two fiscal years.
The Sweetwater Authority also claimed it only charges its customers their proportionate share of the cost of providing water service. However, the rate structure intentionally favors customers who don’t consume a lot of water. The skewed rate structure has two parts: 1) all customers are given a low bimonthly fixed meter charge by shifting the majority of the actual fixed costs into the charge for water purchased, and 2) single family residential customers are given tiered rates (where the amount charged per hundred cubic feet increases with consumption.)
The rate consultant’s initial recommendation dialed back the rate structure skew to be in line with industry standards but it did not move forward. The 2024 rates maintained their unusually low 13 percent for consistent, non-variable, cashflow. The rate study increased this revenue stability metric to 16 percent in 2025 and 19 percent in 2026, which is still lower than industry standards.
The tiered rates mirror the agency’s four water supplies. Tiers 1-3 are low due to cheaper local supplies. The Tier 4 rate presumes that water delivered over 24 hundred cubic feet to a single family residence required the Sweetwater Authority to buy expensive imported water. Yet, the Sweetwater Authority does not purchase water that way. This top rate disproportionately impacts a small minority of single family residential customers concentrated in Bonita who have large semi-rural lots. Yet, at the same time, businesses, condos/ apartments, and public agencies (the groups that purchase the majority of the agency’s water) continue to purchase unlimited amounts of water at a uniform rate.
Water agencies have wide latitude to set rates as they choose. For fairness, agencies should apply the same conservation pricing strategies to all their customers. The Sweetwater Authority initiated two strategies 12 years ago that continue today. One strategy, the low fixed meter charge, is agency-wide. Yet, tiered rates apply only to single family residences, which use less than 40 percent of the agency’s water. And given that Sweetwater Authority already has low per capita water use, these tiered rates are not really about conservation. The data does not lie.
We conserved during drought and got hit with a rate increase. We have excess water, letting it go from Lake Hodges, and are getting hit with a rate increase. Desalinization and toilet to tap and rates still go up. Vote incumbents out.
Get used to more and more fees which are regressive and hit low and moderate income households the hardest. Al these fees help to make San Diego the most expensive city to live in. Pure Water was a rip-off from the start and will continue to take excessive amounts of money from taxpayers, there is absolutely no fiscal discipline with Pure Water. Soon we will have regressive trash fees and there is talk of a new fee to keep storm drainage systems clear. Fees draw more money from low income households, that’s our future.
You are rich in San Diego or you are a slave. If you do not understand or agree, you are in the latter category.
Re: Sweetwater Authority water rates – The higher water users are subsidizing the lower water users. Plain, pure and simple.