3 percent hike in Carson City water rates backed by committee

A Carson City committee is recommending a 3 percent increase in water and wastewater rates while it continues to determine a new rate structure for stormwater fees.

The Utility Finance Oversight Committee on Monday heard a proposal for the three utility rates from consultant Farr West Engineering, which the city hired to do a study.

The increases would ensure the utilities meet financial goals set by the Board of Supervisors, including money for debt service, operating reserves, and reinvestment in depreciating infrastructure.

If approved by the supervisors, the new rates for residential users would be a flat monthly rate of $28.21 and volume charges of $1.81 per thousand gallons of water for up to 5,000 gallons, $3.16 for between 6,000 to 30,000 gallons, and $5.06 for 31,000 and above. Commercial rates would be $42.93 flat rate and $3.64 per thousand gallons and $3.82 per thousand gallon for large commercial customers. The rates would likely go into effect on July 1.

The proposal calls for across the board 3 percent annual rate increase through 2025.

The rates have not been raised since 2018, which was the last year of five-year phase in of higher charges approved in 2013 after years of stagnated rates that left the utility in a bind.

“When (those) changes were imposed there was quite a hole and deficit to overcome. It created angst for customers because the five-year increases were substantial,” said Bruce Scott, UFOC member. “Smaller increases on a programmed basis make a lot of sense for our customers to adjust.”

The review also recommended a five-year annual 3 percent jump in wastewater rates, but the committee asked Farr West to calculate the rate change that would achieve 100 percent system reinvestment within two years, a goal already achieved by the water utility. To reach that, the rate will likely have to increase 3.1 or 3.2 percent.

A 3 percent jump would bump current residential rates to $41.66. multifamily to $28, and commercial to $41.66 with volume charges going to $6.98 for low-volume commercial users and $12.34 for high volume.

The recommendation for both the water and wastewater rates now goes to the supervisors, who will vote on it.

On stormwater, the committee settled on new rate structure that takes impervious surfaces such as driveways and parking lots into account, but asked Farr West to do further work before recommending it to the supervisors.

The plan would create five customer classes consisting of residential customers and four others based on a range of impervious area at each customer site.

The initial monthly rates proposed are $9.34 for all residential, up from $5.69 currently; $30 for less than quarter acre of impervious area; $60 for a quarter to acre; $120 for 1 to 5 acres; and $240 for over 5 acres.

But, the committee wants to include a credit program that could reduce the charge for non-residential customers who install detention basins to mitigate stormwater runoff.

Farr West will bring back a proposal for a credit program and its impact on rates, which could change the charges initially proposed, to the UFOC’s next meeting in March.