Cypress Ranch W.C.I.D. #1

#1

The sub-committee for water rates will model some scenarios and present in the next board meeting. The general view is that 20k gallons is where we need to see usage peak, and I believe most households will continue to naturally fall into this category. The structure proposed below includes a 1,300% increase in rate at usage above 20k gallons. Usage beyond 30k would continue to be prohibitively expensive as it is today. We could look at an additional tier at 25k gallons as well to further incentivize a phase out of higher usage. -RKK

I do not disagree with this, but will need to see this on a spreadsheet. I think the cap amount of water to be used should be 20,000 gallons a month per household- we do not want to run out of water in the summer months. Above that usage is risky. I think we need to look at the data for summer months and make those tiered costs align with what is responsible usage. We are going into a drought and will always be struggling with those conditions.

As we consider our water rate structure I thought it would be helpful to outline a few ideas/theories that might underpin the structure we proceed with. 1. Our annual budget requirements are well understood. We require about $670k to cover our expenses. This is comprised of generally fixed costs, not being strongly tied to the amount of water produced. As such, I believe this cost should be born equally among the customers of the district. The way to achieve this equitable sharing of the fixed burden is to update the base fee paid by each household. Increasing the base fee to roughly $62 for in-district customers and $182 for out-of-district customers gets close to covering our fixed costs. 2. Our monthly water supply is finite and we must encourage customers to conserve. In reality we must price the rate tiers as to inhibit excess usage, which our supply can't keep up with. It's possible to adopt a fee schedule as follow: 0-20K gallons - $1/1000 gallons; 20-30k gallons - $14/1000 gallons; 30-40k gallons - $64/1000 gallons; 40k+ Gallons - $70/1000 gallons. This rate structure will do 2 things: 1. Shares the fixed burden equitably across each household 2. Provides strong incentive to cap usage between 20-30k gallons. The impact of this on monthly bills: Low water usage months would see an increase in water bills by about $20. High water usage months would see a decrease in water bills varying by amount. The average household that uses 15,000 gallons in a month would see a bill $1 higher than today's rates. Theoretically this would average what are today's higher bill across the year. Households with consistent low usage will continue to enjoy low bills, but they would now be carrying their fair share of the operating burden. These are just thoughts put to paper, the numbers can be modeled and fine-tuned but the approach of equal sharing of the fixed costs and inhibiting extreme usage creates a more equitable fee structure. Thoughts and feedback are welcome and encouraged.

Directors- should we post on the neighborhood social media pages about the new pass-thru fees from the water conservation district?