PALMDALE, CA – The Palmdale Water District, by a 3-2 vote, approved a District-wide rate restructure that will standardize meter charges for all customer classes. A recent rate study conducted by Bartle Wells Associates, a third party independent consultant, concluded that a rate restructure will provide the funds necessary to recover the costs of operation, maintenance of infrastructure, and the ongoing capital and administration needs for the District.
“The stability of our water delivery system is the backbone of the District’s mission to provide clean, high-quality, affordable water to the community,” said Dennis LaMoreaux, General Manager of the Palmdale Water District. “Adjusting the rate structure for all customers will allow us to properly manage and maintain both water quality and our critical infrastructure.”
The new structure creates a 55% fixed 45% variable cost recovery from water rates which balance revenue stability, while rewarding customers conserving water with a new “essential” use tier based on indoor use and an “efficient” use tier based on outdoor use.
“The rate plan provides the customer with conservation incentives that promote water savings through the new “efficient” use tier,” said Kathy Mac Laren, President of the Palmdale Water District Board of Directors. “We created a balanced approach for all customers by homogenizing meter charges and giving cost control to the customer on how much water they choose to use.”
Since 2010, the District has experienced a 16% increase in energy costs to operate ground water wells and booster stations that deliver water throughout the community and, due to inflation, a 57% increase in necessary replacement costs per linear foot of pipe.
“The approval of this new rate structure will enable the District to generate the revenue to fund the District’s capital improvement program which includes the replacement of our aging pipelines, wells, booster stations, and fleet,” said Matthew Knudson, Assistant General Manager of the Palmdale Water District. “The new plan will ensure the credit rating of the District remains solid, so the rate payers are able to obtain long-term financing at a reasonable interest rate for large infrastructure and water supply projects.”
The passage of the new rate restructure plan allows the District to continue investing in water treatment and testing technologies to guarantee that drinking water remains safe and clean, while diversifying water resources to ensure the community has a sufficient water supply throughout prolonged drought periods.