CMUD Blasted For Sky-High Rates
“Serious issues were uncovered relating to the utility’s post drought rate increases and its efforts to redefine the billing tier structure in such a way as to increase year-over-year billings for similar usage up to 60% for average users and significantly more for heavy users,” the task force reports states.
“Upon reviewing CMUD’s presentation to the City Council for its post-drought rate increases,” the report continues, “the Task Force observed a pattern of incomplete statements and obfuscation through the use of averages to veil the true impact of rate adjustments to consumer bills.”
The biggest impact CMUD officials predicted, for example, during an April 2008 briefing to council was a monthly bump of $13.19 for customers who used 12 CCFs.
The task force recommended restoring CMUD’s rate structure to pre-drought levels of three tiers using rates at their current levels for tiers 1 through 3, while establishing incremental increases to Tier 1 pricing levels to bring them more in line with average users.
The city council, in the meantime, is currently reviewing CMUD’s rate structure and considering possible changes moving forward.
The task force’s report also gave low marks to the meters and transmitters that CMUD uses to record water usage and calculate bills. The electronic transmitters allow remote meter reading and send data on usage back to CMUD. Some of the department’s older transmitters, however, have an abnormally high failure rate. Those transmitters, the task force found, often under-report usage for several months.
When that happens, CMUD performs a quick-check by doing an on-site meter reading and comparing the results to data provided by the transmitter. The meter typically reports a more accurate, and thus higher reading, and CMUD’s practice is to adjust bills to reflect such. That creates a sudden spike, which reflects the actual accumulated usage of a CMUD customer. In turn, the higher water usage bumps the customer into a higher payment tier. It’s a double-whammy, with the customer not only recording more water usage, but also paying a higher rate for the water used.
The task force recommended that CMUD immediately replace any transmitters identified as faulty and enact a moratorium on denying water access while a customer disputes a bill that remains unresolved.
Also on the water-usage front, the task force noted that CMUD revenue, collected from water customers, is being used in an inordinate number of cases to essentially subsidize infrastructure projects that have little to do with actual water-delivery service. There appears to be, the report states, “a significant number of projects that are directed or dictated by factors outside the realm of strictly utility-generated need.
That assessment should ring familiar to anyone who recalls the city backing out millions of dollars worth of infrastructure cost from the South Corridor rail line budget’s bottom line.
“These projects,” the task force report concludes of questionable CMUD capital expenditures, “include sewer repair and relocation work for municipal projects that could arguably be reimbursed from tax revenues and city or county-generated projects that support economic growth and development.”
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