Oakland, June 11, 2019
EBMUD Board approves budget and rate increase
Rate increase for fiscal years 2020 and 2021 support water and wastewater infrastructure improvements for the East Bay
Oakland, CA – Today, the East Bay Municipal Utility District Board of Directors adopted a two-year, $2.3 billion budget that will pay for critical improvements to the water and wastewater systems that serve East Bay residents and businesses. The Board voted 5-1 to approve the rates subject Proposition 218 and 6-0 to approve the rates not subject to Proposition 218.
To fund these improvements, water rates will increase 6.5 percent on July 1, 2019, and 6.25 percent on July 1, 2020. On the wastewater side, the typical homeowner will see a 3 percent increase on July 1, and an additional 4 percent increase in 2020.
For most EBMUD customers, the cost of water remains at about one penny per gallon. EBMUD, a not-for-profit utility founded in 1923, conveys fresh water 90 miles from the Mokelumne River watershed in the Sierra Nevada to more than 1.4 million customers in Alameda and Contra Costa Counties. EBMUD’s system encompasses more than 4,200 miles of pipes, five local reservoirs, six water treatment plants, 164 water storage tanks and a large wastewater treatment plant at the foot of the Bay Bridge. The replacement cost of the system is estimated at more than $15 billion.
“Our infrastructure would weaken without crucial repairs and upgrades,” says Board President Marguerite Young. “Our focus is ensuring this system, the lifeblood of the East Bay, continues to operate for another 100 years. This budget will fund the high quality, reliable water delivery and wastewater treatment that the East Bay relies on for a vibrant economy, environment and quality of life.”
Bill impacts
For customers, the effect on bills depends on how much water they use. An average household using 200 gallons a day will see an increase of $3.62 per month in July 2019, and an additional increase of $3.73 per month the following year. A low water user (100 gallons daily) would see an increase of $2.56 per month for the first year and an additional $2.64 per month starting July 2020. The bill for a high water user (averaging 600 gallons daily) will go up $9.86 per month the first year and an additional $10.05 starting July 2020. For wastewater, the increased charges and fees for the average homeowner will be under $1 per month for FY2020 and an additional $1.24 in FY2021.
System investments
Infrastructure renewal is expensive and essential. A typical mile of pipeline costs roughly $2.5 million to replace. In the next two years, this budget funds more than $800 million of capital improvements. A surge in infrastructure work is planned throughout EBMUD’s service area, including:
- $110 million for pipeline replacement in Oakland, El Cerrito, Berkeley, Orinda and Lafayette
- $110 million to replace large water transmission pipes that bring water from the Sierra foothills to the East Bay
- $170 million for improvements at water treatment plants, pumping plants and local reservoirs in El Sobrante, Oakland, Walnut Creek and Orinda
- $70 million for improvements to the Wastewater Treatment Plant in Oakland) and large sewer interceptors along the waterfront
“Water may be free, but getting it to customers is not. Our rates cover the cost to store, treat and deliver water -- and those costs continue to rise,” says General Manager Alexander R. Coate. “While we understand that it’s difficult to see rates increase, our customers are counting on us to provide these essential services.”
Rate setting
EBMUD is committed to fair and reasonable rates. State law only allows EBMUD to recoup the costs necessary to operate and maintain our system and ensure that it is stable and safe for the future. The District follows Proposition 218 guidelines for rate setting and public hearings, conducts cost of service studies every 10 years using an outside consultant, and is audited annually by an independent accounting firm. As a result, EBMUD has one of the highest bond ratings for any water or wastewater agency nationwide. The fiscal 2020 and 2021 rate-setting process formally began in January 2019 with a series of public Board workshops and concluded June 11 with a public hearing and Board vote.
“Over the last 20 years, EBMUD has seismically strengthened our system to make it more resilient and worked to diversify our water supply to respond to climate change,” says Director of Finance Sophia Skoda. “Now, our focus is rebuilding our system as it ages. We plan to pay for these improvements with both cash and debt, to ensure this generation and future generations help pay for these vital investments.”
EBMUD also offers one of the most generous affordability programs in the state. Through our Customer Assistance Program, EBMUD provides discounts to qualified customers based on their incomes. For more information about this program, please see: ebmud.com/CAP. For more information about EBMUD’s budget and rates, please see ebmud.com/rates.