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CVWD News

Posted on: June 11, 2019

CVWD approves domestic rate increase

CVWD Board Room

The Board of Directors of Coachella Valley Water District (CVWD) voted Tuesday to increase domestic water rates.

The rate increase, which will go into effect on July 1, increases the average monthly bill for customers by $1.84 per month.

The increase approved by the board followed much discussion among board members and staff and some public testimony. The final rate was lower than what was recommended by staff who had noted CVWD’s upcoming capital improvement program includes important upgrades to infrastructure. Projects include miles of water main that need to be replaced and 64 reservoirs requiring inspections and rehabilitation.

Staff also cited a shift in strategy from a pay-as-you-go approach that draws from reserves to short-term and potentially long-term financing for capital improvement projects. As CVWD enters the financial markets, it needs to show that the Domestic Water fund is structurally sound.

Currently, according to the staff report, the three-year forecast shows a budget shortfall of $81 million. This is based upon a revenue forecast of $246 million, and an expense forecast of $327 million (including $261 million in operating expense, and $116 million in capital improvement programs, plus offsets of nonoperating revenues).

To close the gaps, staff outlined three options and recommended one, called Option C, that would have covered the fiscal 2020 and 2021 shortfalls in fiscal 2020 with an 18.5% increase with no rate increase anticipated for fiscal 2021.

The board instead supported the first-year plan outlined in the staff’s Option A that eliminates the shortfall for fiscal 2020 but leaves fiscal 2021 up for future deliberation.

For more information, go to www.cvwd.org/rates

The Coachella Valley Water District is a public agency governed by a five-member board of directors. The district provides domestic and irrigation water, agricultural drainage, wastewater treatment and reclamation services, regional storm water protection, groundwater management and water conservation. It serves approximately 108,000 residential and business customers across 1,000 square miles, located primarily in Riverside County, but also in portions of Imperial and San Diego counties.

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