Friday, March 7, 2008

The cost of water conservation

First, Charlotte-Mecklenburg Utilities officials ask us to conserve water. Now they slap us with a bill for the cost of that conservation: The expected loss of water and sewer revenues means a bigger boost in water and sewer rates. Translation - our water/sewer bills are going up even as we use less water.

Ah, sh... shucks.

One Forum writer speculates about “another fleecing of the citizens”. CMU Director Doug Bean tells City Council, which must approve the rate increase, it’s just math. With the unexpected and necessary conservation, millions of dollars the utilities plans on to meet budget will be gone. Since the utilities operates on fees and rates, not taxes, the only way to make up the difference is to raise fees. Utilities officials, who dropped by to talk to the Observer’s editorial board, also said this in an e-mail:

“One point we would re-emphasize is just how much capital costs play a role in the Utilities budget. These projects are necessary to serve our growing service area and for upgrades/reinvestment to existing infrastructure. In fact $158 million of this year’s $254 million budget is a fixed amount specifically dedicated to finance debt service for recent, current and future capital improvement projects.”

The shortfall threatens the system’s bond rating - and its ability to borrow money at low interest rates, Bean said. If the city doesn’t increase fees, it could cost the system millions of dollars in interest.

The proposed increases would mean an about $6.36 extra each month to the typical customer, beginning in May, if approved by City Council.

The proposal also would penalize heavy water users more. Customers are charged on a tiered system: The more water used, the more expensive it is per gallon. The proposal makes those tiers more aggressive, increasing the cost of water more quickly.
Bean says “water is not an unlimited, cheap commodity that can be wasted.” Sigh. Get out the checkbook.

What do you think about this water/sewer rate increase? Talk back to us.

11 comments:

poolman said...

I think if we're going to pay extra for water, we ought to be able to use it. I can't wash my truck, but the wealthy can continue to operate their swimming pools. I can't use a sprinkler, but they can add water to their pools, which tend to lose an inch of water a month due to evaporation. Backwashing the filter uses hundreds of gallons of water. A typical Charlotte fat cat's pool will lose up to a hundred gallons PER DAY, over 500 gallons a week. The typical lawn uses around 500 gallons for each watering. It pays to be the king.

poolman said...

Sorry, I meant to say a typical pool loses a inch of water a week, not a month, more if it's heated. I know this from years of experience servicing pools. Consider another source, Terry Tamminen, author of "The Ultimate Pool Maintenance Manual," in which he states "Pools and spas are in fact a major source of environmental degradation...in our effort to keep them clean and at a specific temperature, we generate hazardous waste, greenhouse gases...and we waste the most precious natural resource on the planet--water."

Anonymous said...

If they need more water sales to avoid the price increase, I'm your man. I've just turned on all my taps, flushing toilets every five minutes, and running both outdoor faucets full bore into the yard. Hope this helps.

But if it is not enough, maybe something innovative, like in a long and desperate drought, take the money you charge me for "storm water run off" and give it to the water department.

Not very nice to tell me to conserve water, then charge me for doing so, charge me for storm water run off, while begging the gods for more runoff.

So of course the water price hike will be temporary, and will come off when the lakes and tanks are full?

Count on that.

Don't worry, it's not a tax increase, it's a fee increase. Explain the difference to your wallet.

thirsty for change said...

"These projects are necessary to serve our growing service area...."

And impact fees are a bad thing? Its time to clean City Council out and get some people with a backbone.

We can come up with money for a NASCAR Museum to help out the poor destitute France family, but we can't help ourselves supply water? I don't know how CMUD is run, but its not a for-profit corporation. Its tied to the local government in some way. Find the money.

Anonymous said...

CMU Director Doug Bean tells the City Council, "It's just math." Uh, no...it's our dollars, our money he's talking about.

There's not enough detail in this article concerning "heavy water users" and the proposed tiered billing system. Who decides who's a heavy user, and how many tiers are proposed. It sounds as if CMU is trying to backdoor some sort of the-sky's-the-limit billing system.

And Bean can talk about capital costs and "future capital improvement projects" all he wants, but most people don't have the faintest idea what he's talking about.

What a crock.

Richard Ingram said...

My family has gone to extremes conserving water and my company is very active in the water conservation effort. We don't flush the toilet when its yellow and we don't wash our cars or water our lawns or pressure wash our dirty siding and have even gone to using a dishpan to do the dishes and turn the water on only in spurts to rinse,yet I see daily that people in their fancy cars and SUVs at the car wash spraying them down as if they are special. Autobell recycles its wash water so I don't have a problem with them;but the corner self serve carwash is rocking and rolling and people act like its their right to waste all the water they want to keep their precious cars shiny.....My truck hasn't been washed in over a year except for when I go out during a rain shower and wipe it down and allow the rainfall to do the rinsing for me;so why in the hell should I be charged more for water when i have cut my usage down to less than3 CFU's per month?It's time the people in this city start acting like there is someone besides themselves involved in this life and stop wasting water.Any car wash that does not recycle its water should be closed down andanyone seeing someone washing their vehicle should pick up the phone and report them to CMUD and there should be REAL consequence for those people.To many people are under the impression that it doesn't apply to me,and unfortunatly since there are no consequences for their blatent disregard for their fellow citizens our so called city govenment encourages such behavior.You can't park your car on your lawn on your own property in Charlotte but you can wash your car every week during water restrictions and its okay.Sounds like a bunch of crap to me. Rick Ingram

Anonymous said...

DA questions;

CMU Director Doug Bean tells City Council, which must approve the rate increase, it’s just math.

It is not Mr. Beans math that is flawed, it is the CMU operational procedures and budget process. As Mr. Bean stated “In fact $158 million of this year’s $254 million budget is a fixed amount specifically dedicated to finance debt service for recent, current and future capital improvement projects.”

Mr. Bean, any reputable utility company will have a capital improvement budget along with an operational budget. Typically only a small portion of the capital budget is funded by the existing rate payer base, with the majority of the capital budget funded through actual and projected tapping fees. (new connections) Budget reserves resulting from surpluses generated from the current rate structure are typically used as short term financing on capital projects until tapping fees are collected. The existing customer base is typically only necessary to guarantee fulfillment of CMU bond obligations and as a last resort is actually responsible for their payment. Operational costs such as water treatment, sewage treatment, payrolls, repairs, etc. would be totally funded by the existing customer base. If this were the case, operational costs should have decreased during this conservation period negating the need for a rate increase.

Plain and simple, it sounds like CMU is and has been passing along to existing rate payers what should be considered developer’s costs.

Mr. Bean what were CMU’s operational cost increases during this conservation period?

Why is there no mention of drastically increasing the cost for new water and sewer connections?

Why is there no mention of cutting the capital budget, after all CMU stated there was a $4.4 million shortfall in new connection fees.

Rate payers, if you don’t speak-up you only have yourselves to blame.

Anonymous said...
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Anonymous said...

So CMUD had no way to know that the limited product they had to sell would actually mean they would collect less revenue? (how nice to be able to produce less, with less associated cost, and make the same or more income) Why were rates on the highest users not increased in the beginning to encourage conservation and preserve needed revenue? "Necessary" increases should be ONLY on the highest users, above 11000cfu, at which point someone is irrigating and maybe willing to pay for the privilege.This is about the haves and have nots, most of us being the latter who will have brown lawns, dead landscaping,dirty cars and siding .When we see huge unrepaired leaks and read about the millions of revenue lost because of them, we feel inclined to believe the whining holds little credibility.

Anonymous said...

DEAR CMUD---
I HAVE LIVED IN FLA FOR MOST OF MY LIFE, BEEN ON HUNDREDS OF WATER RESTRICTIONS THROUGH THE YEARS--AND HAVE NEVER HAD MY WATER BILL BE INCREASED DUE TO BEING THE GOOD CITIZEN AND CUTTING BACK ON USAGE. I AM EMBARRASED TO LIVE HERE--IF YOU ARE THAT SHORT ON FUNDS FROM US--I'LL BE GLAD TO WASH MY CAR--PRESSURE CLEAN MY HOME, WATER MY DEAD PLANTS,SO YOU ALL CAN KEEP YOUR HIGH PAYING JOBS!!IF ANY OTHER BUSINESS LOSES MONEY--GUESS WHAT--THEY CUT BACK ON THEIR EXPENSES--YOU SHOULD TOO!! SHAME ON YOU--I HOPE THE USAGE GOES SKY HIGH!!!AND WHEN THE DROUGHT IS OVER YOU'LL TAKE US BACK TO THE LOWER RATES? HOW COME I DO NOT BELIVE THAT????

Lorenza Coon said...

A lot of people had been into this kind of situation. No matter what they do, it seems that their efforts in conserving water don’t lower their water bills. It’s just normal for you to be frustrated, knowing that you really did something to lower your rates. Well, regarding the proposal, I’m sure there were a lot of amendments made to it in the past years. “The more water used, the more expensive it is per gallon.” – Based on how I look at it, I think many people won’t agree with this scheme.

Lorenza Coon