Rate Structure and Fees
Water is a limited resource and its costs increase with higher rates of consumption.
Therefore, the City adopted an increasing block rate structure where the unit
price of water rises with increasing increments of water use. It has been in
existence since the drought of 1989. The rate structure was designed to encourage
conservation and pass on the costs of higher water use. Each water unit is
equivalent to a hundred cubic feet (Ccf or 748 gallons) of water.
For residential customers, the city uses a five-block rate structure. The first
block (lifeline) applies the lowest rate for water usage up to 10 Ccf for a
two-month period (equivalent to 123 gallons per day per house). The next 11
to 75 Ccf of water are charged at the highest rate for the units used. See Current
Utility Rates. Multiple-family accounts are included
in the residential rate structure. When a site has more than 9 dwelling units,
it is given a discount on its monthly service charge to reflect lower water
demands. In addition, because multiple-family accounts often have one meter,
the City prorates the block water use thresholds for each site based on number
of dwelling units.
The non-residential classes, including commercial, municipal, and other customers
(e.g., Cañada College) are charged a monthly service fee based on the
meter size. In addition, the quantity charge is based on a three-block rate
structure, 0-15 Ccf, 0-75 Ccf and +75Ccf. There is a modest differential between
these block rates to reflect the fact that non-residential customers are much
more heterogeneous regarding how they use water and their associated volumes.
Just because a non-residential customer uses a lot of water, does not necessarily
mean they use water inefficiently. Hence, a large rate differential is not
warranted or used.
For new developments, the City charges a water facilities fee to recover investments
made by existing water customers in the water distribution system to accommodate
new growth. This fee ensures that new developments pay their own way. This
fee will be updated annually to account for cost inflation.