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Menlo Park to launch study of municipal water rates

Menlo Park is due to start a new a five-year rate study for its water system, which could increase water rates in the future for households that receive water from the Menlo Park Municipal Water District.

The city plans to hire a consultant to complete the study in spring 2021, and was expected to iron out more details at its meeting scheduled on Sept. 22. The city has a substantial list of capital improvement projects for its water system set over the next five fiscal years that add up to $26,038,127, according to the city's online budget, accessible here.

The study will also include an evaluation of a possible low-income rate program, which early estimates indicate could cost $11,960 to $35,880 per year to support about 1,335 households whose low incomes already qualify them for reduced utility rates through PG&E.

Some signs indicate that more households have recently struggled to pay their water bills. Between December 2019 and August 2020, the number of accounts on payment plans increased about sevenfold, to 53 from eight, staff reported. As of Sept. 1, 506 single-family households the water system serves had overdue bills more than 30 days old, adding up to an unpaid total of $263,701. During the pandemic, the municipal water company has waived down payment fees and not disconnected any customers due to nonpayment or broken payment plans, they added.

Councilman Ray Mueller added that he was interested in heeding calls by some residents to look into selling off the water infrastructure to Cal Water, which runs the water system for the majority of Menlo Park. Doing so could complicate the city's water rights, interim City Attorney Cara Silver said.

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Last November, Menlo Park's former water billing contractor, Fathom, shut down with less than a month's notice and the city had to scramble to find a new provider. It contracted with the company Minol to do all of the billing processes except for meter reading through Dec. 31. The city contracted a separate company, FRM, to do the meter reading services through February 2021.

Since no billing or meter reading system was in place between November and February or March, depending on the billing cycle, customers generally had much larger bills during that period.

However, several community members said their water bills had been consistently and substantially higher under the new contractor, and some said they hadn't been able to get satisfactory answers as to why.

Chris Lamm, Menlo Park assistant public works director, said that the higher bills are likely not a problem with the water meters – as they age they tend to underestimate rather than overestimate the amount of water used – and noted that generally, a major source of household water use is landscaping during the summer months.

Overall, he said, water use is up since the pandemic started. Between March and June this year compared to last year, water use is up 3%, he reported.

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Residential use is up 21%, commercial use is down 38%, industrial use is down 13% and irrigation use – measured on separate meters for commercial, industrial and large homeowner associations – is up 42%, according to staff.

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Menlo Park to launch study of municipal water rates

by / Almanac

Uploaded: Fri, Sep 18, 2020, 11:25 am

Menlo Park is due to start a new a five-year rate study for its water system, which could increase water rates in the future for households that receive water from the Menlo Park Municipal Water District.

The city plans to hire a consultant to complete the study in spring 2021, and was expected to iron out more details at its meeting scheduled on Sept. 22. The city has a substantial list of capital improvement projects for its water system set over the next five fiscal years that add up to $26,038,127, according to the city's online budget, accessible here.

The study will also include an evaluation of a possible low-income rate program, which early estimates indicate could cost $11,960 to $35,880 per year to support about 1,335 households whose low incomes already qualify them for reduced utility rates through PG&E.

Some signs indicate that more households have recently struggled to pay their water bills. Between December 2019 and August 2020, the number of accounts on payment plans increased about sevenfold, to 53 from eight, staff reported. As of Sept. 1, 506 single-family households the water system serves had overdue bills more than 30 days old, adding up to an unpaid total of $263,701. During the pandemic, the municipal water company has waived down payment fees and not disconnected any customers due to nonpayment or broken payment plans, they added.

Councilman Ray Mueller added that he was interested in heeding calls by some residents to look into selling off the water infrastructure to Cal Water, which runs the water system for the majority of Menlo Park. Doing so could complicate the city's water rights, interim City Attorney Cara Silver said.

Last November, Menlo Park's former water billing contractor, Fathom, shut down with less than a month's notice and the city had to scramble to find a new provider. It contracted with the company Minol to do all of the billing processes except for meter reading through Dec. 31. The city contracted a separate company, FRM, to do the meter reading services through February 2021.

Since no billing or meter reading system was in place between November and February or March, depending on the billing cycle, customers generally had much larger bills during that period.

However, several community members said their water bills had been consistently and substantially higher under the new contractor, and some said they hadn't been able to get satisfactory answers as to why.

Chris Lamm, Menlo Park assistant public works director, said that the higher bills are likely not a problem with the water meters – as they age they tend to underestimate rather than overestimate the amount of water used – and noted that generally, a major source of household water use is landscaping during the summer months.

Overall, he said, water use is up since the pandemic started. Between March and June this year compared to last year, water use is up 3%, he reported.

Residential use is up 21%, commercial use is down 38%, industrial use is down 13% and irrigation use – measured on separate meters for commercial, industrial and large homeowner associations – is up 42%, according to staff.

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