The San Luis Obispo City Council approved new sewer and water rate increases Wednesday, according to the city.
The increases are intended to stabilize revenue for the city’s water department, which includes fixed costs such as capital improvements, employees and debt payments.
Residents can expect their bills to increase 7.5 percent on July 1 and an additional 5.5 percent in July 2014. The 7.5 percent increase will raise the average residential water bill by $2.77.
An average local household uses about 5,984 gallons, or eight billing units, of water a month, according to city figures.
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The water bill for such a household, 2.3 people on average, is $54.71 a month. Under the new rates, that will go up to $57.48 in July and to $60.64 in 2014.
A new rate structure was also approved, dividing water consumption into two tiers for all users. Residential water users used to have three tiers while all other customers had two, city utilities director Carrie Mattingly said.
The tiers are set up so those who use more water will pay more, which is meant to encourage conservation.
There’s also a new $5 fixed fee on all bills, charged every month. The fee is intended to secure stable revenue into the city’s water fund at the same time the new two-tier system encourages people to use less water, Mattingly said.