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Understanding the new water rates without math

By From page A1 | May 02, 2014

To best describe the city’s new consumption-based water rates that are set to take effect in January, you need to think of the fire hydrant near your house.

It’s always on standby, it has no water meter and everybody pays for it regardless of how much water they use. Keep that in mind.

Early on in the campaign for Measure P, the initiative on the June 3 ballot that would have the City Council scrap the water rates and start again, some proponents suggested an approach that sounds very simple: Design a rate where you pay more if you use more, gallon by gallon.

As will be explained, that’s deceptive when it comes to rates that pay for the entire water system. Further, the consumption-based rate that Measure P would toss out gets closer to that than traditional water rates Davisites are used to paying — at least in its structure.

Davis residents eventually will pay as much as two to three times what they did in early 2013, in order to cover the cost of a new surface water project undertaken jointly with Woodland. The project will siphon water from the Sacramento River, treat the water and pipe it to both communities.

Let’s focus first on a basic water rate, and let’s get back to that fire hydrant.

City services cost money. Your fire hydrant is no different. It had to be bought, it had to be installed, it has to be in good working order and it has to be on standby with access to a lot of water in case your house, or your neighbor’s house, catches on fire. That readiness costs money every month.

Let’s think about how that fire hydrant is taken care of. People do that, but not for free. They’re city employees and they draw a salary. That costs money every month.

Let’s think about the pipes that serve the fire hydrant and the water mains to which your house’s plumbing system is connected. They cost money to buy, to install and to maintain. Once again, there’s a monthly cost.

If everyone paid by the gallon exclusively, there wouldn’t be enough money to cover the upkeep of the water system in the summer.

Why? Because every winter, water use would plummet and the amount of money people would pay for the water system would drop as well. Come summertime, the system would fail when people needed to water their lawns, take a shower and have that fire hydrant ready for disaster at the same time.

Basic two-step water rates take that into account. So, whether you are using one gallon or 1 million gallons, you pay a fixed charge every month to pay for the capacity of the system. Not a drop of water gets paid for with the fixed charge, just the so-called “dry” costs.

The water, the wells, water storage and the cost to filter it and treat it to standards set by the state using chemicals, plus the electricity it takes to run the water system, are usually wrapped up into a second “wet” charge that changes with how much water you use.

In traditional rate systems, your use affects this charge only so much because many of the so-called “wet” costs lean more toward the “dry” side by being less changeable than others. These are called “wet-fixed” costs.

That’s where the consumption-based rate is different from a basic rate. It separates the fee you pay into three charges: the “dry” costs; the “wet-fixed” costs for wells, surface water and above-ground storage; and then the complete “wet” costs of how much water you use and how much money it takes to treat and move that water along the system.

Because the “wet” costs are separated from the other fixed costs, water customers can more directly control how much “wet” costs they are charged for.

The consumption-based rate is currently measuring water use from now until October to establish the rate customers will pay for the next year.

On the surface, this sounds much less fair than a 12-month measurement, but because the vast majority of water use happens during the dry months when residents water their yards, a six-month summer measurement more accurately measures the capacity of the system when it is being used the most.

The consumption-based rate also ensures that people who use more water pay more. Apartment dwellers who use water for basic needs like washing dishes and taking showers pay less than customers who have a large house to accommodate a family, with a large irrigated yard and a swimming pool.

— Reach Dave Ryan at [email protected] or call 530-747-8057.

Dave Ryan

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