The Zone 7 Water Agency is undertaking a rate study to determine whether the agency's current water rates are financially sustainable.
The water board decided to contract Raftelis Financial Consultants to conduct the study, which is not to exceed $100,000, according to the agency. Preliminary results of the study will be discussed at a special board meeting on Aug. 26.
A years-long drought has affected the agency's revenues and reserves, and such a study will review the agency's finances, including its budgets, the funding needed to put the agency's capital improvement and asset management plans into effect, findings from the Water Supply Evaluation and recent audits.
The study will also analyze the cost of service and will propose a three-year wholesale water rate, which will go before the water board this fall. It will also propose a drought wholesale rate that can be incorporated into the forthcoming Urban Water Management Plan, which will be adopted by the board in the spring.