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The Pleasanton City Council is set to hold a public hearing Tuesday to consider adopting proposed increases to the city’s water rates for the next four years, which city staff estimate would raise the average single-family customer bill by roughly $20 each year.
If approved, the proposed amendments to the city’s “master fee schedule” would also include changes to the water connection fees and sewer rates. These rate increases would then be set to take effect starting Jan. 1, according to the staff report.
Two years ago, the City Council approved a two-year water rate increase of 30%, which went into effect January 2024 and 12%, which went into effect January 2025. According to the city, those increases were meant to “maintain adequate funding for short-term operations and maintenance of its water systems and to replenish the reserves to City Council-approved levels”.
However, since then the city has continued to emphasize the need for regularly assessed water rates and fees in order to address several growing challenges in the water supply and delivery industry, including the 100% purchase of the city’s water supply from the Zone 7 Water Agency, aging infrastructure and rising construction costs.
These challenges — particularly the long-term infrastructure needs — were identified in the city’s Water System Management Plan, which the city approved in 2024. According to the staff report, the plan identified a 20-year capital improvement program and long-term operations and maintenance strategies.
After identifying the financial needs of the city’s water program through the management plan, the city contracted with Water Resources Economics last September to perform a comprehensive water rate study which, according to the staff report, served as a framework for establishing a “cost-based, fair and legally defensible rates and connection fees to support the long-term financial sustainability of the city’s water program”.
Since then, the council has met a number of times to review the different water rate scenarios before settling on the now proposed rate structure change that includes a 100% Zone 7 fixed-cost recovery on fixed charges.Â
This would change the city’s water rate structure from a tiered system to a uniform one where very low water users will see their bill more than double by the end of four years.
According to the city’s bimonthly impacts reports for single-family customers with a 5/8-inch meter, average water consumers under the proposed rate structure can expect a nearly $20 bump to their current water bill by next year but by year four, that difference jumps to over $80.
The council also previously discussed drought rates and connection fees and ultimately agreed on maintaining the city’s current drought rate allotment policy, but instead of keeping it at 10 ccf (centum cubic feet), the council agreed to staff’s proposal to lower it to 8 ccf, which is about 6,000 gallons of water. As for the connection fees, the council had also agreed during its June 3 meeting to move forward with calculating the connection fee utilizing a hybrid method where new customers pay a portion to buy in and a portion to build new capacity.
According to staff, all of these proposed water and drought rates as well as the connection fees and all the specifics behind those rates have been mailed out to Pleasanton water customers and residents as part of the Proposition 218 public hearing notice process.
“Per Proposition 218, the city must notify all customers of record of proposed changes to water rates and hold a public hearing to consider adoption,” according to the staff report. “If a majority of customers submit a formal written protest, the proposed rate changes cannot be adopted. If a majority of formal written protests are not received, the City Council may adopt the proposed changes, but is not obligated to do so.”
The city mailed out these notices on Aug. 1 and now the public hearing is set for Tuesday where the council will be poised to approve the new rates and fees that they have been discussing over the past few months.
The City Council meeting is scheduled to begin at 7 p.m. Tuesday (Oct. 7). The full agenda can be accessed here.
In other business
During its consent calendar portion of the meeting, the City Council will be voting on authorizing City Manager Gerry Beaudin to enter into a professional services agreement with Wood Rodgers, Inc. for the development of a Stormwater System Management Plan.
Items under the consent calendar are considered routine in nature and are typically voted on and approved by a single vote.
Pleasanton’s stormwater drainage and conveyance system currently includes 228 miles of storm drain pipelines, four pump stations, a number of trash capture and pollution control devices and much more infrastructure.
According to staff, that stormwater system has been constructed incrementally over the years following new residential and commercial developments but there has not been an overarching management plan in place to “guide staff on all aspects of stormwater system management.”
That is why the city is looking to Wood Rodgers Inc. to develop one.
“The plan is intended to guide decision making of the stormwater system for operations and maintenance, capital improvements, regulatory compliance requirements, resource staffing, as well as providing a framework for financial sustainability,” according to the staff report.
After assessing the adequacy of existing infrastructure, the goal of the management plan will be to ultimately lead to the development of a 20-year capital improvement strategy.
“This plan will also assess the regulatory environment, and the cost to maintain regulatory compliance, along with assessment of staffing requirements for operations and maintenance,” according to staff. “All of these unique costs will be used to drive decision-making for revenue generation, planning and actions by 2029.”
The agreement with Wood Rodgers Inc. would cost the city no more than $2,192,186 and would be funded by the Storm Water System Management Plan Project fund, which has a total project budget of $2.2 million.
