EID Water Rates
"CHEAP" EID WATER RATES:
EID’s "reported" 2011 Residential Water rates of $387 annually are 19% LOWER than the $478 annual average for surrounding Water districts Auburn, South Tahoe, Folsom and Rancho Murrieta (based on .37 acre feet consumption annually).
Counting $6.24 million Property Tax subsidies ($164 per customer annually), EID’s “ALL-IN” Residential Water rates/revenues total $551 annually, or 15% HIGHER than the four above surrounding districts. This is due to EID’s high Debt Service costs for “future customers”, subsidies to Hydro and Recreation, and subsidies to Domestic Irrigation and Small Farm customers.
EID’S RESIDENTIAL WATER RATES INCLUDE $4.5 MILLION OF ANNUAL COST SUBSIDIES:
$3.0 million annual interest on Debt for “future customers” (i.e. for Project 184/Hydro currently unused Water “firm system yield”, and for unused Water treatment capacity) Note: To comply with Proposition 218 proportionality requirements, these “future customer” costs should be covered by Property Tax revenues, not by Water rates.
$1.5 million of subsidies to 1300 Domestic Irrigation customers, 200 Small Farm customers, and to Recreation.
EID WATER RATES:
The above “plus and minus” adjustments combine to create artificially low EID Water rates. Despite the above $4.5 million COST subsidies, EID’s Residential Water rates are kept artificially lower than surrounding Water districts due to $6.24 million of annual Property Tax REVENUE subsidies. Additionally, correction of Overhead cost allocations will add $1.0 million to Water costs.
After correcting for EID’s Overhead and Debt cost allocations, EID Water rates would need to increase at least 20%. With this increase, EID Water rates would be comparable to the average of surrounding Water districts Auburn, South Tahoe, Folsom and Rancho Murrieta.