Public hearing to look at proposed water rate hike
By Nancy Needham  nancy@theacorn.com

An increase in water rates over the next two years for customers served by the city of Thousand Oaks water system will be the topic of a public hearing on Sept. 25.

A 12 percent increase is proposed for the first year and a 7.5 percent increase the second year.

Water connection charges would be hiked by 30 percent the first year under the proposal.

The city doesn't make a profit on water and has kept its rates lower than nearby water providers, said Public Works Director Mark Watkins.

About 16,000 residential and commercial customers will be affected. The Thousand Oaks water system serves about 37 percent of the city's water users.

Two reasons for the proposed price increase are the cost of capital improvements and an increase in the wholesale price the city pays for water.

"Purchased water is two-thirds of our operating costs," Watkins said.

City water customers were to receive notices in the mail and can protest the increase in writing or in person at the hearing.

According to Proposition 218, water service charges are property-related fees and a majority protest in writing can prohibit the council from raising rates, Watkins said.

Revenues from the water fee cannot exceed the funds needed to provide the services, a staff report said.

Proposition 218 doesn't affect the services provided by private water companies that follow a process set up by the California Public Utilities Commission.

The Water Capital Program adopted by the City Council in June includes $30 million in construction projects over the next 10 years. Cash flow projections for the next two years estimate that the capital fund reserve will be down more than $2 million even if the rates are increased.

The reserves as of June were at $4.3 million.

In 2004 the city agreed to include the Conejo Oaks community in the city's water area effective Jan. 1, 2008.

To accomplish this, capital improvements and pipeline connections must be made. A staff report said Conejo Oaks customers should bear the burden of these improvements.

A temporary surcharge of 13 percent above the city rates will be levied on the Conejo Oaks service area until the cost of the improvements is paid.

For the first time in about 20 years the water company hired a financial consultant. Bartle Wells Associates, based in San Francisco, found the city's water and wastewater systems to be in sound financial shape, Watkins said. The consultant cost about $30,000.

"Wastewater is in excellent financial condition with no fee or service charge adjustments required for next two years," the public works director said.

Still, the price of water to the city continues to go up, and capital improvements are required as the city's infrastructure gets older. Pumps and pipes will need to be replaced, and tanks will need painting, Watkins said.