Arroyo Grande water and sewage bill costs will soon rise

Arroyo Grande residents will soon be charged an average of at least $16 more on their water bill, though some customers could face increases of more than $26 every two months.

The rate increases for water and sewer service come as the city continues to try to balance the need for conservation amid drought with the Catch-22 that conserving more means less revenue. The Arroyo Grande City Council passed the three-year temporary drought rates at its meeting Tuesday night. The new rates will go into effect in September.

The city initially projected that water revenue would bring in $21.1 million for the 2016-17 fiscal year, according to a city staff report. Now, because of mandated conservation, Arroyo Grande expects that revenue to be $17.9 million — a $3.3 million shortfall. The city also expects sewer rate revenue to be about $450,000 less than officials originally projected.

Because of the shortfall, the city warned that its water fund, which pays for water infrastructure maintenance among other water-related costs, could fall below the minimum required balance by about $111,000 by the end of the fiscal year, and that gap would continue to grow unless rate changes are made.

To counter this, the city proposed a three-year temporary drought rate that would increase water and sewer rates by 11 percent and 10 percent, respectively. Residents would on average pay between $10 and $18 more per bill for water and about $6 to $8 more for sewer service, according to the staff report. Water bills are charged every two months.

The rates for water would increase slightly each year until 2019, while the sewer rate would remain the same.

This story was originally published August 11, 2016 at 2:40 PM with the headline "Arroyo Grande water and sewage bill costs will soon rise."