2020 Water and Wastewater Rate Study
Cloverdale's Water & Wastewater Utilities
The City of Cloverdale provides water services to over 3,300 residential, commercial, industrial, and irrigation service connections. The city can provide more than 500 million gallons of water per year and maintains over 40 miles of water pipelines, 3,300 service lines, hundreds of fire hydrants, 10 storage reservoirs, and two pump stations. The city's water filtration plant has the capacity to produce 4.5 million gallons per day of high-quality drinking water. The city's 7 wells have an approximate total capacity in the summer months of 3.6 million gallons per day. Capital Capital projects totaling about $26.9 million have been identified to build a new well, rehabilitate aging wells, improve treatment facilities, replace and or rehabilitate pipes, pump stations, water tanks, and other system facilities over the next ten years.
Proposed Rate Changes
Reasons for the Proposed Rate Changes
A Rate Study was previously updated in 2016 which recommended adjusting water and wastewater rates by 3% on July 1, 2017, 2018 and 2019. Periodic rate adjustments are necessary to:
- Ensure that each customer bears a fair and proportionate share of the cost of providing services (consistent with legal requirements)
- Cover the rising cost of providing services, including operation and maintenance costs, debt service, and capital program needs
- Meet financial, regulatory, and service obligations
Water and wastewater costs include:
- Energy, fuel, and chemical costs
- Water production and treatment costs
- Wastewater treatment and disposal costs
- Water distribution and wastewater collection costs
- Administrative and customer service costs
- Costs related to facilities replacement, rehabilitation, and upgrade of water and wastewater systems
Central factors necessitating rate increases at this time include:
- Funding requirements for the replacement, rehabilitation, and upgrade of water and wastewater facilities which have experienced deferred maintenance in recent years.
- Increased costs of water and wastewater operations, including energy costs, supplies, maintenance, and employee costs.
2020 Water and Wastewater Rate StudyThe City actively works to maintain the financial stability of the two utilities while providing safe and reliable services. Updates to the Water and Wastewater Financial Plans and to supporting rates are periodically necessary to ensure that the water and wastewater utilities are fully able to cover the costs of providing services. Updating the water and wastewater rates to keep up with the rising costs of providing safe and high quality drinking water and wastewater services is a key component of maintaining the financial viability of the utilities, including maintaining healthy fund balances/reserves for emergencies and applicable bond covenants, and debt coverage ratios for bond covenants and strong credit ratings. Updates to the rate study are also necessary to fund infrastructure investments in infrastructure maintenance and improvements which are mandated or otherwise necessary for safe and efficient operation of the utilities.
The rate analysis and proposed rates and rate structures are described in the 2020 Water and Sewer Rate Study (PDF).
A PowerPoint presentation about the 2020 Rate Study was prepared to provide an overview of the rate study.
Public Hearing on Water and Wastewater Rates
The City Council considered a recommendation from staff to adopt changes to the water and wastewater rates at a public hearing on Wednesday, November 11, 2020, held via Teleconference. The hearing started at 6:00 p.m. After the close of the Public Hearing, the Council recommended ending the 218 process and holding a workshop to further discuss the 2020 Water and Sewer Rate Study and receive public input from the community.
More information about the November 11 public hearing and the proposed rates is provided in the Proposition 218 Public Hearing Notice (PDF).
A Press-Release (PDF) was issued dated November 11, 2020 providing an update on the Water and Wastewater Rate Study/Rate Setting Process.