EMWD Customers to See Sewer Rate Increase

Customers of Eastern Municipal Water District will see a slight increase in their sewer rates starting July 1.

EMWD's Board of Directors approved the increase 5-0 during its April 20 meeting. Murrieta, Temecula and French Valley customers now get billed $24.30 per month for sewer service. The board is looking at spreading out any necessary increases over several years to minimize the impact to customers, according to a news release.

In order to have enough revenue to cover a gap between rate revenues and upcoming debt repayment obligations, sewer rates would need to be eventually increased by a total of approximately $1.82 per month, according to the news release. The initial July 1 rate increase will add approximately 81 cents to customers' bills.

EMWD attributes the necessary increase to a $4.4-million gap between current sewer rates and its debt obligations. The debt was incurred when EMWD's four operating sewer treatment facilities all underwent replacement and upgrade projects in order to maintain safe, reliable and cost-efficient service for customers. The updgrades were also necessary to continue to meet all State and Federal requirements from the Environmental Protection Agency (EPA).

New regulatory requirements have also increased operating costs, according to EMWD. For example, the Air Quality Management District (AQMD) Rule 1110.2 now requires staff to perform more frequent, specialized emissions testing and reporting for engines. Complying with this new regulatory requirement alone increases costs by approximately $0.30 per customer, per month.

EMWD said it continues to seek ways to offset cost increases by securing low interest rate loans and planning the replacement and upgrade projects in conjuction with existing expansion projects to save on construction projects. Rate payers only pay for the replacement and upgrade portions of the projects, while all costs associated with expansion projects are paid by future customers through new connection fees.

In addition, the current economy has resulted in lower construction costs due to the competitive bidding environment. As a result, in the last few years, EMWD said its overall construction costs have been about 25 percent lower than original estimates, resulting in more than $25 million in cost savings.

EMWD said it continuously examines its operations and looks for ways to reduce costs by increasing efficiencies. Therefore, some projects are completed to increase operational efficiency, which reduces annual operating costs. For example, by upgrading the Moreno Valley and Perris Valley facilities to utilize fuel cell technology, EMWD said it will save up to $1.6 million a year in maintenance and energy costs.

EMWD’s cost-saving efforts have kept water rates down, too, according to the news release. For example, even though MWD increased imported water rates by 7.5 percent in January 2011, EMWD’s water rates for all residential customers will not be affected.

EMWD is able to absorb the impact of the MWD rate increase due to internal cost control measures that reduced operating costs, according to the news release.

Responding to improved water supply conditions throughout the state, the board also voted to terminate Stage 2 Water Shortage Contingency Measures, which have been in effect since June 2009, and reinstate Stage 1. As a result, EMWD’s mandatory water efficiency requirements are now voluntary.