Santa Cruz water rates

Why Conservation Isn’t Cutting Santa Cruz Water Rates

Local water ratepayers express frustration at paying more for less

Two Soquel Creek Water District workers install a gate valve to work on a pressurized main without shutting off water flow.

Soquel Creek Water District customer Nicole Behar’s water bill went up more than 50% this year, after the agency hiked rates in March. She feels that the district may be getting “greedy.”

“It’s almost $200 a month, and we were paying $74,” Behar says. 

The trend is “super frustrating,” she adds. “I feel like it’s shady.” 

The water agency bills customers in two ways—a fixed service charge, which often sits around $40 per month—and an additional charge based on the quantity of water used. The district bills households $6.43 for each of the first six units of water, based on about 748 gallons per unit. After that, billing increases sharply, to $29.19 per unit. 

For customers with large meters or fire line connections, charges are even higher. While aimed at promoting conservation, the tiered rate system can have expensive consequences for those with large families like Behar, a stay-at-home mom of four boys. 

“I’m pretty conservative with water. I get dinged just because we have six people in my house,” she says, compared to smaller households that may use water in other ways. “People that have lavish lawns and use tons of water are actually getting a cheaper rate.” 

Rates at Soquel Creek Water District will continue to increase by 9% per year for the next four years. In a county with notoriously high costs of living, the increases could represent another way for residents to get priced out of the area, worries Soquel Creek Water customer Marty Fletscher, whose bill went up $40 per month. “I didn’t get a $40 a month raise,” he says.

There are some, however, who think the bills aren’t high enough. Retired journalist John Dickinson served for two years on Soquel Creek’s Water Rates Advisory Committee, which aimed to create a fair rate scheme for consumers and the district. 

“The problem is that water is way too cheap. We don’t charge enough, and people basically think it ought to be free,” he says. “But they’re perfectly happy to pay all sorts of prices for gasoline and perfume and whiskey.” Dickinson adds that increased rates might incentivize people to conserve more. 

Paying More For Less?

The problem is that conservation efforts by Soquel Creek Water customers in previous years are also contributing to today’s rising costs. 

“When people use less water, our costs don’t drop, so we have to charge more for the water that’s being used,” says Leslie Strohm, finance and business services manager for the district. That declining revenue stream, she says, creates a financial planning catch 22 for a district that hiked rates partly to disincentive unnecessary water use, but also to raise money for conservation and new projects.

Customers, in turn, responded by aggressively cutting their usage, not only to save water, but also to save money. That has prompted the district to keep raising rates in an effort to make up the difference, and it’s left customers paying more for less.

Soquel Creek’s tier-one revenue covers expenses like maintenance and transport costs. The second-tier revenue will fund supplemental water supply sources, namely the Pure Water Soquel project, a $90 million venture aimed at replenishing groundwater levels and preventing seawater intrusion by pumping treated wastewater back into the over-drafted groundwater basin. 

If all goes as planned, Pure Water Soquel will treat the wastewater using methods like reverse osmosis filtration, disinfection and ultraviolet light. “Once we’ve purified it to that level, you can drink it, but we won’t be doing that,” says Strohm.

At least not right away. Instead, water will be funneled into recharge wells where it will seep down and replenish the aquifer. Over time, the water will move through the aquifer and back to production wells, where it will be re-treated and delivered to residents’ homes. 

Soquel Creek is not alone in upping its rates to pay for big projects. The neighboring Santa Cruz Water District saw rates increase again last month, for the fourth time since 2016. The city has $300 million worth of improvement projects lined up over the next several years on its backbone infrastructure to address issues like antiquated technology, pipes and treatment systems. 

Since no federal or state funding is pre-allocated to help pay for these improvements, the cost burden falls primarily on ratepayers. Neither district has a program in place to assist low-income ratepayers. 

Santa Cruz Water Director Rosemary Menard says it’s almost impossible for any water district to offer bill assistance as a result of a voter-approved 1996 proposition that prohibits any ratepayer revenue from being used to assist another group of ratepayers. 

“The business model that we’re stuck in is not conducive to maintaining equity and access for people who are less able to pay,” says Menard. “That issue has been emerging all over the state.” 

Statewide, water rates went up 45% from 2007 to 2015, according to data from the American Water Works Association. With no end to increases in sight, things may have reached a tipping point as the state aims to address access issues through Assembly Bill 401. The bill, which was signed into law four years ago, established the Low-Income Water Rate Assistance Act, with the goal of establishing a statewide program for low-income ratepayers. It’s still in the research and development phase.

Menard says she’s focused on immediate solutions to try and keep costs down for Santa Cruz ratepayers. That includes grant funding, debt financing and a $25-40 million bond measure to help pay for the next wave of projects. 

“We deal with people every day who have challenges and issues, and really our toolbox isn’t very full,” she says. “We’re trying to figure out how to get some more tools in the toolbox, but we’re not all the way there yet.”

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