EBMUD’s budget and rate-setting process for fiscal years 2024 and 2025 is underway. New rates will take effect July 1, 2023, and again on July 1, 2024.
At the second in a series of public workshops held on March 28, 2023, EBMUD staff presented to the Board of Directors a proposed budget for the next two fiscal years (July 1, 2023– June 30, 2024) totaling $2.66 billion with the water system representing 83 percent and the wastewater system 17 percent of the budget.
Investing in the Future
EBMUD is here for you – in each drink from a faucet, each shower and handwash, and every drop sent down the drain. We provide clean water to every home, business, hospital and school in our service area. For a century, we’ve supported the East Bay’s health and economy while protecting the environment.
Looking forward, we face numerous challenges as we work to provide reliable, high-quality water and wastewater services. Aging infrastructure, some of it more than 100 years old, needs continued maintenance and replacement. Climate change is driving the aridification of the American West and bigger swings between severe droughts and intense storms. Our water systems must deal with emerging contaminants. And wastewater treatment, provided for more than 70 years for shoreline cities in our service area, must reduce stormwater infiltration and limit nutrient loads to better protect public health and the San Francisco Bay.
To meet these challenges, EBMUD is entering the most capital-intensive period in its history. We’re increasing our five-year capital improvement program to invest $2.8 billion to rehabilitate water treatment plants, pumping plants, reservoirs and pipelines. We’re upgrading our wastewater facilities and sewer interceptors.
EBMUD is a not-for-profit public utility. Your rate dollars directly fund operations and capital improvements. We are recognized as responsible financial stewards and are the only California water utility to receive Moody’s Investors Service’s highest AAA water bond rating.
Regular customer rate increases are necessary to invest in building a resilient and reliable water and wastewater system of the future. As we innovate to improve our infrastructure and service, we confront rising costs due to supply chain disruptions and inflationary pressures on equipment, chemicals, energy, and labor.
EBMUD is proposing rate increases that would result in average single-family customer water bill increases of 19 cents a day when new rates take effect July 1 and another 21 cents a day beginning July 1, 2024. Rates for wastewater customers would rise 7 cents a day each of the next two fiscal years. These represent increases of approximately 8.5 percent in both FY 2024 and FY 2025. Actual changes in a customer’s bill will depend on how much water is used each billing period.
Our precious drinking water remains a good value at just over a penny a gallon. But we know any cost increase can be a hardship for some, so we’re also making our Customer Assistance Program easier to access for those who have trouble paying their water bills.
EBMUD is dedicated to serving East Bay customers and investing in our community as we have for a century. Thank you for investing your trust in us.
Proposition 218 requires that a notice about the changes to proposed rates and charges and other fees be mailed to all customers and property owners 45 days before the public hearing on rates and charges held by the Board. EBMUD mailed this notice to customers and property owners in Spring 2023. It explains that the proposed rate increases to the water and wastewater service charges are necessary for EBMUD to recover current and projected costs of its operations and maintenance, and fund capital infrastructure improvements and repairs.
EBMUD has supported the East Bay’s health and economy while protecting the environment for 100 years. As we begin our second century of service, we face numerous challenges as we work to provide reliable, high-quality water and wastewater services:
· Aging infrastructure, some of it more than 100 years old, needs continued maintenance and replacement.
· Climate change is driving the aridification of the American West and bigger swings between severe droughts and intense storms.
· Our water systems must deal with emerging contaminants.
· Wastewater treatment must reduce stormwater infiltration and limit nitrogen, phosphorus and other nutrient loads to better protect public health and the San Francisco Bay.
To meet these challenges, EBMUD is entering the most capital-intensive period in its history. We’re increasing our five-year water and wastewater capital improvement program to invest $2.8 billion to:
· Upgrade water treatment plants
· Replace aging pipelines
· Rebuild neighborhood reservoirs
· Modernize wastewater facilities
· Rehabilitate sewer interceptors
· Overhaul pumping plants
Because EBMUD is a not-for-profit public utility, your rate dollars directly fund operations and these capital improvements.
We are all thankful for the rain and snow refilling our reservoirs. On March 1, EBMUD removed its drought surcharge (8 percent on the volume charge) used to purchase supplemental supplies and pay for additional drought expenses. And with the drought over, EBMUD lifted mandatory water conservation requirements for customers.
Rain is free. But getting it to you is not.
The true cost of water is the cost to maintain the infrastructure and run the vast system that delivers safe, reliable water to your home 24/7.
EBMUD’s extensive water system includes aqueducts that deliver water 90 miles from the Sierra foothills to the East Bay; tens of thousands of acres of watershed lands; 4,200 miles of pipelines; reservoirs and storage tanks; pumping plants; and water treatment plants. We operate these facilities so that our drinking water meets or exceeds all state and federal health standards. EBMUD’s wastewater treatment plant and wastewater pipes are part of a complex system that protects public health and San Francisco Bay.
More than 70 percent of EBMUD’s revenue is based on how much water people use, which encourages wise water use. But roughly 96 percent of operating costs are fixed. As a result, the cost to provide service doesn’t go down with the amount of water that’s used. And customer expectations for reliable service remain the same regardless of drought or heavy rain. On top of it, the region – and nation – is experiencing inflationary cost pressures on equipment, chemicals, energy and labor.
EBMUD’s budget is based on the costs to provide service, plus prudent projections about how much water people will use. We have seen a pattern of reduced water use – 15 percent less since 2013 (before the last drought) – as customers continue conservation efforts. As less water is used, rates need to increase to balance the costs to operate, maintain and repair our aging water system. We’re more efficient now than in 1970s, even though the East Bay’s population has increased nearly 40 percent and we have added about 80,000 water accounts.
It is imperative that we invest in tomorrow’s infrastructure. To do that, rates must be sufficient to maintain and improve our water and wastewater systems to ensure they are resilient and reliable now and for the next generation.
EBMUD is proposing rates that would result in average single-family customer water bill increases of 19 cents a day when new rates take effect July 1, 2023, and another 21 cents a day beginning July 1, 2024.
Rates for wastewater customers would rise 7 cents a day each of the next two fiscal years.
These changes represent increases of approximately 8.5 percent in FY 2024 and FY 2025.
Actual changes in a customer’s bill will depend on how much water they use each billing period.
EBMUD conducts a transparent rate-setting process, and rates are set to cover only what it costs to provide reliable service and maintain long-term financial stability. We aim to keep rates fair and reasonable. Our proposed budget prepares us to meet our next century, with rates that are as low as possible to maintain our great service.
EBMUD is a not-for-profit public utility, and your rate dollars directly fund operations, maintenance and capital improvements. Any additional revenue is reinvested in the system.
EBMUD is recognized as a responsible financial steward and is the only California water utility to receive Moody’s Investors Service’s highest Aaa water bond rating.
We are proud our drinking water remains a great value at a little over a penny a gallon.
EBMUD is a non-profit public agency. To ensure fair rates and charges, EBMUD:
· Follows the guidelines set through Proposition 218 (now Article XIII, Sections C and D, of the California Constitution) for rate-setting public hearings.
· Conducts cost-of-service studies every 10 years, typically using an outside consultant.
· Is audited by an independent CPA firm annually. EBMUD employs an external auditor to examine and report on EBMUD’s financial accounts; this report is presented to the Board of Directors.
· EBMUD rates are set to cover only what it costs to provide reliable service and maintain long-term financial stability.
· Our fiscally sound practices result in EBMUD having among the highest bond ratings of any water or wastewater agency nationwide. EBMUD uses a rate model that includes a forecast of water use and treatment, proposed operating and capital cash flow budgets, financial policy requirements (like amount of debt service coverage), interest rates, projected inflation, pay as you go capital costs and current balances for reserves and construction.
We’re increasing our five-year capital improvement program by more than $500 million to rehabilitate water treatment plants, pumping plants, reservoirs and pipelines. We’re also upgrading our wastewater facilities and sewer interceptors.
Water system investments of $2.5 billion include:
- 127 miles of pipelines replaced over next 5 years
- Orinda Water Treatment Plant
o New UV disinfection, chlorine contact basin
- Upper San Leandro Water Treatment Plant
o Improve capacity, seismic reliability, chemical safety
- Lafayette Reservoir
o Outlet tower seismic retrofit
- Sobrante Water Treatment Plant
o Improve chemical safety system
- Neighborhood reservoir and pumping plant replacements
o Increase pumping capacity, improve reliability
Wastewater system investments of $335 million include:
- Rehabilitation of five sewer pipeline segments connecting cities to wastewater treatment
EBMUD remains committed to the community we serve. We offer several programs to make the cost of water and wastewater services more manageable, and we are making our Customer Assistance Program easier to access for those who have trouble paying their water bills. Information about our financial programs is available at ebmud.com/assistance, or you can call our Customer Service Department at 1-866-403-2683.
· Payment plans and payment extensions: We work with customers to figure out a payment plan that works for them. We will consider payment extensions or payment plans when customers need more time to pay. All customers (including businesses) can take advantage of these options.
· Help for businesses: Businesses that are having difficulty paying their bill can request payment plans and payment extensions. We will work with all customers that are experiencing financial difficulties to figure out a payment plan that works for them.
· Customer Assistance Program: EBMUD’s Customer Assistance Program offers generous discounts for income eligible households: up to a 50% reduction on water flow and charges and 35% discount for wastewater flow and charges. Customers who are facing financial difficulty are encouraged to apply at ebmud.com/cap.
· Saving water: Another way to help the planet and reduce your water bill is to use less water. EBMUD’s WaterSmart rebates and water saving tips can help. Visit ebmud.com/watersmart.
EBMUD has made a long-term commitment to increase infrastructure investment. Two-thirds of EBMUD’s budget is dedicated to infrastructure investments. We need qualified plumbers, heavy equipment operators, engineers and other professional staff to plan, design, install and maintain infrastructure including reservoirs, pumps, treatment plants and 4,200 miles of pipelines
EBMUD is a public not-for-profit agency. Our mission is to provide fair and reasonable rates for customers. We rely on skilled staff to operate and maintain these systems for the public’s health 24 hours a day, 7 days a week.
EBMUD’s water rates are just below the middle of our peer Bay Area water utilities for the average single family residential user.
EBMUD provides wastewater treatment only for cities west of the Oakland-Berkeley hills, south of Richmond and north of San Leandro. In this area, local cities and agencies maintain the sewer system that takes the wastewater to EBMUD’s wastewater plant. More than half of the wastewater charges are set by these local cities/agencies. When you combine our treatment charge with agency sewer charges, the total charge is in the top third compared to other regional wastewater utilities.
· Delve into the details on our website at ebmud.com/rates.
· Virtually attend EBMUD’s Water Wednesday webinar on June 7, 2023, at 6 p.m. to learn more about the budget and rates process and to ask questions. (Details to register to come.)
· Participate in the public hearing on Rates and Charges at the Board of Directors meeting on Tuesday, June 13 at 1:15 p.m. Pacific Time (US and Canada). The Board will hear comments and vote on proposed rates and budget for fiscal years 2024 and 2025. For more information, and to attend virtually, visit our website at embud.com/boardmeetings.
Written protests may be mailed before the June 13, 2023, hearing to:
EBMUD
MS 218
P.O. Box 24055
Oakland, CA 94623-1055
or delivered before the close of the public comment portion of the public hearing to the EBMUD security desk the front entrance at 375 11th Street, Oakland, CA.
All written protests must be received by EBMUD prior to the conclusion of the public comment portion of the public hearing. Protests by email, fax, or other electronic means will not be accepted as formal written protests. More information about filing a protest is available at www.ebmud.com/rates.
Protest Procedure
Customers and property owners have the right to submit a written protest to the proposed increases if they will be affected by the increases. The right to submit a written protest includes both property owners and tenants who directly pay the EBMUD bill.
When submitting your protest, please identify which water or wastewater service charge increase or increases you are protesting. The proposed rate increases will not take effect if EBMUD receives written protests from a majority of the affected parcels.
Any written protest must include the following information:
State the specific service charge increase (water and/or wastewater) you are protesting
Provide the location of your parcel (by customer account number, street address, or assessor’s parcel number); and
Include the name and signature of the property owner or tenant submitting the protest.
Protests which do not include this information will not be counted. We will count only one written protest per parcel. Written protests must be received before the end of the June 13, 2023 public hearing in order to be counted. You are also welcome to speak at the public hearing, but any comments given verbally or by email or other electronic communication will not be counted when we determine whether or not a majority of parcels have protested. Written protests must be submitted by mail or hand-delivered to the front desk or dropped off at the June 13 public hearing that will be held during the EBMUD Board meeting, which begins at 1:15 p.m.
Mail Protests To:
Deliver In-person:
EBMUD
MS 218
PO Box 24055
Oakland, CA 94623-1055
EBMUD
375 11th Street
Oakland, CA 94607-4240
Services to help
EBMUD recognizes the Bay Area’s high cost of living and offers one of the most generous customer assistance programs in the state. Our Customer Assistance Program provides discounts to qualified customers based on income level. For information, visit: ebmud.com/CAP.
Your Rate Dollars at Work
Based on proposed FY 2024 / FY 2025 biennial budget.
Water and Wastewater Rates Cost of Service and Capacity Fee Studies
Water and wastewater rates are established to recover costs included in the District’s operating and capital budgets, meet the District’s policy goals and comply with applicable law, including Proposition 218 and the Municipal Utility District Act (“MUD” Act). Rates should also enhance the District’s ability to provide safe, reliable, and sufficient water supply and wastewater treatment services to its customers over the long term.
The Water System Capacity Charges (SCC) and the Wastewater Capacity Fee (WCF) recover the proportional shares of the costs of water and wastewater facilities for new customers joining the water or wastewater systems or for customers requiring increased water demand or wastewater treatment. The SCC and WCF comply with applicable law, including Proposition 26, California Government Code Section 66013, and the MUD Act.
To ensure that the water and wastewater rates and capacity fees are established in accordance with municipal water and wastewater rate setting principles and in compliance with applicable law, the District hires independent financial consultants to conduct periodic water and wastewater rate cost of service studies and capacity fee studies. The results of these rate costs of service and capacity fee studies are typically updated annually.
Water and Wastewater Rates Cost of Service Studies
