News

Palo Alto set to raise water rates

Average residential bill would go up by 25 percent under latest proposal

Palo Alto's water rates would spike by 25 percent for the average residential customer if the City Council approves the latest proposal from the Utility Department tonight (Monday).

The rate change, which would take effect Oct. 1, aims to cover the rising costs of the city's water supply and to help pay for the $4.6 billion effort by the San Francisco Public Utilities Commission to upgrade and repair aged Hetch Hetchy infrastructure.

The new rates would increase the water bills for the largest residential customers by 28.6 percent, from $190 to $244. Residential customers in the medium category would see a 25.4 percent jump, while the smallest customers would see a 10 percent increase.

Staff is proposing an average rate increase of 21 percent for all customers. This would add $18.31 to the average residential bill and $31.55 to the bill of the average medium commercial customer.

According to a report from the Utilities Department, the city already has some of the highest water bills in the area. While Menlo Park's monthly residential bill is about 14 percent higher than Palo Alto's, Redwood City, Mountain View and Santa Clara all have much lower rates. The average residential customer in surrounding cities pays about 14 percent less than the average Palo Alto customer, the report states.

The reasons for the higher bills include Palo Alto's older infrastructure, higher rent payments of use of real estate in the service territory and lack of access to cheaper water supply, the report states.

The new rates are expected to add $3.4 million in revenues to the city's water utility, which has a projected $6.2 million shortfall in the current fiscal year, according to a report from Ipek Connolly, a senior resources planner in the Utilities Department. The balance of the deficit would come from the reserves.

The city's water supply costs are projected to increase by 37 percent this year and to double by 2016, largely because of the major infrastructure project. Palo Alto is one of 27 municipalities that draws its water from the Hetch Hetchy system.

The council meeting will begin at 6 p.m. tonight in the Council Chambers at City Hall (250 Hamilton Ave.).

Gennady Sheyner

Comments

 +   Like this comment
Posted by RC
a resident of Adobe-Meadows
on Sep 19, 2011 at 10:22 am

Where does Redwood City get its water from?


 +   Like this comment
Posted by Kate
a resident of Duveneck/St. Francis
on Sep 19, 2011 at 10:25 am

This increase will come from what we would have spent in the community like a theater ticket, supper at a low cost restaurant, and cutting back once more someplace else that's really basic. With medical insurance premiums skyrocketing and the cost of food escalating (notice the price of eggs, bread, fish, orange juice and other 'basics' and gasoline), there's just so much to spend. Protesting this increase is a waste of time since it takes 50% plus one of all the Palo Alto USERS to protest which would be an estimated 10,000 protests (the State law) in writing. Impossible to get and the city knows it. Save a stamp.


 +   Like this comment
Posted by David Pepperdine
a resident of Another Palo Alto neighborhood
on Sep 19, 2011 at 10:34 am

The Palo Alto Utilities Dept is an end-run around Prop. 13.


 +   Like this comment
Posted by common sense
a resident of Midtown
on Sep 19, 2011 at 10:43 am

The artice says "The reasons for the higher bills include Palo Alto's older infrastructure, higher rent payments of use of real estate in the service territory and lack of access to cheaper water supply, the report states"

Do you know who the rent payments go to? the city's general fund. A hidden way for the city to raise more money without having to go to the voters for a tax increase.


 +   Like this comment
Posted by Goodgrief, too much watering
a resident of Midtown
on Sep 19, 2011 at 10:59 am

That's what is wrong with water plan....many people live in condos and apts and we don't have our own meters, so there is NO WAY to stop the overuse of water since we all pay into it, regardless how I might preserve the water, not overwatering, do short showers, etc. BUT if others don't, it's not fair, and not good for the environment. Seems gardeners keep overwatering our plants that don't need it!!!! Good grief. New condos should HAVE to have their own meters for home use; and other watering of condo planters on another meter.


 +   Like this comment
Posted by Scrooge
a resident of Charleston Gardens
on Sep 19, 2011 at 11:12 am

I am SO tired of paying ridiculous rates to Palo Alto Utilities.

Maybe if they stopped sending frequent mailings to all of us on how to save energy, they could cut the bills.

Don't they have a slush fund they're trying to figure out how to spend? Let them spend it on keeping customers happy by cutting rates.


 +   Like this comment
Posted by pockets empty
a resident of Old Palo Alto
on Sep 19, 2011 at 11:24 am

I guess there are just too many ways too get into our pockets. Exorbitant use fees are now the new "TAX increase" alternative. I'd like the city to clearly articulate what they have done to reduce cost before asking the people they are suppose to be working for to pay more.

I wish I had the ability to just increase my paycheck on demand. Sure would make it a lot easier than the on going spending reduction families are continuing to do.. I am sure if we reduce our water use further there will be additional cost increases to make up for the lack of use. Just like the refuse rate increase due to too much recycling.

Does anyone have any detail of the painful spending reductions the city has taken to minimize the impact to it's Palo Alto family?


 +   Like this comment
Posted by Fed UP
a resident of Old Palo Alto
on Sep 19, 2011 at 11:25 am

Will this City Council ever get off it's duff and order a long overdue Audit of PAU.
These constant arbitrary rate hikes (trash, water,gas, electricity...) have got to stop already.
Less than adequate service, exorbitant fees and a lame Council.


 +   Like this comment
Posted by Senior
a resident of Another Palo Alto neighborhood
on Sep 19, 2011 at 11:49 am

About 10 years ago I let my backyard die because the water rates kept going up back then. Now is the time to let my front yard die - I can;t afford any more raises on my Social Security. They;re chasing the seniors out of town.


 +   Like this comment
Posted by ENUF
a resident of Old Palo Alto
on Sep 19, 2011 at 11:54 am

Sounds like Palo Alto has reached the line and can no longer afford the luxury of its own exclusive Utilities Company.
I'd say time for Council to serve its constituents and put this baby up for bid.


 +   Like this comment
Posted by junior
a resident of Old Palo Alto
on Sep 19, 2011 at 11:54 am

Just rent your house, the renters do not care about yard, and you can get nice income too.


 +   Like this comment
Posted by Utilities_Ripoff
a resident of Another Palo Alto neighborhood
on Sep 19, 2011 at 11:56 am

The Utilities Department has long hidden behind the fig leaf of higher infrastructure maintenance costs, as though other cities don't have to do this. San Francisco undoubtedly has higher infrastructure maintenance costs than Palo Alto. Mountain View and Redwood City have similar costs. Yet Palo Alto insists on overcharging for water.

The water department has never offered a comparative analysis of Palo Alto's costs vs. that of other cities in the Hetch Hetchy System, to:
a) Explain the source of the higher costs
b) List what they are doing to address these higher costs

I know because I've tried. Mr. Tom Auzenne of Utilities speaks in riddles when you ask him this question. His responses translate to rhetoric -- "It's complicated." And the City Council buys all this crap.

There's simply no accountability here.


 +   Like this comment
Posted by member
a resident of Duveneck/St. Francis
on Sep 19, 2011 at 1:12 pm

The utility department needs oversight. The number of workers on street repair sites is phenomenal, especially when they are simply standing around. Too, if you drive by the utilities department after 3 pm, you often will see utility workers kicking back...not working on projects before their 4 pm end-of-day. Perhaps if the city (and union?) were aware that residents are on to these unproductive, expensive uses of time by utility workers and if the utilities dept corrected these problems, there would be less resentment among PA residents when utilities rates rise.


 +   Like this comment
Posted by Outsource
a resident of Another Palo Alto neighborhood
on Sep 19, 2011 at 2:30 pm

At some point, Palo Alto has to come to terms with the reality that we cannot afford our own Utilities Department, especially not one that pays a bankrupt company (Enron) $21.5 million. These costs are then passed on to ratepayers.

How much of our payments are for salaries, bonuses, retirement and other benefits?

How much are directly paid to outside agencies?

Remember when the Utilities workers were found working on side jobs DURING city paid time? Remember when the Utilities managers asked workers to falsify certification tests and the Feds had to investigate?

It's time to shutdown this horrible (dis-)organization.

Where is the ROI analysis for these outrageous, skyrocketing charges?

There is no oversight, no accountability.

It would be far more efficient to outsource these functions currently performed by the Utilities Department to a private company or a neighboring city.


 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton
on Sep 19, 2011 at 3:21 pm

Just imagine if Palo Alto outsourced its utilities to companies that actually knew how to run water, sewer, gas and electrical utilities. And also outsource police services to the Sheriff and fire services to a regional consolidated agency.

Among other things Palo Alto would reduce its pension costs by many millions of dollars every year with no future liabilities for the outsourced services.


 +   Like this comment
Posted by Ernesto USMC
a resident of Ventura
on Sep 19, 2011 at 5:26 pm

Is this the same PA utilities whose managers are trying to unionize to try to squeeze more compensation from the city? (taxpayers)

These guys need to be accountable to the public, as does any council member who lets them get away with this. It's high time we start outsourcing large swaths of the city bureaucracy.


 +   Like this comment
Posted by Resident
a resident of Old Palo Alto
on Sep 19, 2011 at 8:23 pm

Council had better plan on tapping into the $32MM of PA Utilities reserves, before hiking anymore fees.
Web Link


 +   Like this comment
Posted by Money give away
a resident of Another Palo Alto neighborhood
on Sep 20, 2011 at 10:56 am

Outsource says:"...especially not one that pays a bankrupt company (Enron) $21.8 million." Actually, they paid Enron's creditors $21.8 Million. Meanwhile, both the City of Santa Clara and a town in Washington State were let off by a Bankruptcy Judge.

Our then City Attorney said it would cost more than $21.8 Million to fight the lawsuit, and the then City Council went along with his recommendations, and we paid up.

You can draw your own conclusions as to how well our City Utilities are run.


 +   Like this comment
Posted by Dumbfounded
a resident of Midtown
on Sep 20, 2011 at 11:24 am

+ 25 % ?!!!

That's a HUGE increase! Unbelievable. Our income is frozen. How are we to deal with all these recurrent utility rate increases?


 +   Like this comment
Posted by Dumbfounded
a resident of Midtown
on Sep 20, 2011 at 11:29 am

I will add that it is time for the City to stop dipping in the Utilities income to fund other city expenses and activities. We just can't afford it any more.


 +   Like this comment
Posted by pockets empty
a resident of Old Palo Alto
on Sep 20, 2011 at 11:37 am

And the really sad part here is that you can expect additional increase due to " cost over runs". Think about it, have you ever seen a project this size come anywhere near close to budget. I suspect this time next year we will hear the sob story and a recommendation for another 25% to cover inept utilities management of this project.


 +   Like this comment
Posted by David
a resident of St. Claire Gardens
on Sep 21, 2011 at 12:37 am

does anyone know why palo alto has a much higher waste disposal fee and now higher water rate comparing with our neighbor?


 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton
on Sep 21, 2011 at 7:54 am

David asks:"does anyone know why palo alto has a much higher waste disposal fee and now higher water rate comparing with our neighbor? "

Yes, because Palo Alto thinks it is smarter than the specialized businesses that run such operation elsewhere - the results/prices speak for themselves.

If PG&E served Palo Alto do you think that PG&E would have only one feeder line for the entire city?


 +   Like this comment
Posted by Clean House
a resident of another community
on Sep 21, 2011 at 10:41 am

It is long past time to thoroughly clean house at Palo Alto City Hall.


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