Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

FPUD outlines rate setting process

A presentation at the Oct. 26 Fallbrook Public Utility District board meeting outlined the process of setting calendar year 2021 rates.

The presentation was a nonvoting item, but the FPUD board members expressed no objection to the schedule.

In November 1996, the state's voters passed Proposition 218, which requires a public vote on benefit assessments. Proposition 218 exempts water and sewer rate increases if a cost of service study shows a relationship between the rates and the agency's cost to provide water or sewer service.

A rate setting policy can be in effect for up to five years and must include a rate design and public review. In December 2017, the FPUD board held a Proposition 218 hearing which approved annual rate increases of up to 8.0% through calendar year 2022.

The rate setting process will include a recommendation whether to hold a new Proposition 218 hearing so that rates can increase beyond the 8.0% amount earlier. "The board's Fiscal Policy and Insurance Committee will be meeting in November and working with staff to evaluate options and establish the proposed rates," said FPUD General Manager Jack Bebee.

FPUD's water costs for fiscal year 2020-21 are expected to increase by 9%. The San Diego County Water Authority has an Infrastructure Access Charge which is used for SDCWA fixed expenditures incurred even when water use is reduced. The CWA rates and charges for calendar year 2021 include a 15.8% increase in the IAC. FPUD has 11,855 meter equivalents, so the total Infrastructure Access Charge the district will pay to the CWA is $603,180.

"Our wholesale water costs from the Water Authority increase an average of 8% annually," Bebee said. "More than half of our cost to run the district goes to the Water Authority. That is why we are seeking to switch wholesalers and buy our water from Eastern Municipal Water District, which will sell us water for about 30% less than the Water Authority."

San Diego County's Local Agency Formation Commission will be reviewing the proposals of FPUD and the Rainbow Municipal Water District to detach from the CWA and join the Eastern Municipal Water District. The CWA and Eastern are both members of the Metropolitan Water District of Southern California.

LAFCO has created an advisory committee to address issues, including whether FPUD and Rainbow should pay an "exit fee" to cover the lost CWA revenue for fixed charges. If the LAFCO board approves the reorganization the detachment and annexation must be confirmed by a public vote, either in the June 2022 primary election or at a special election in 2021.

FPUD's board also annually reviews updated financial projections and sets rates and charges for the next calendar year based on the district's actual fiscal needs. The rates cover potable water, recycled water and wastewater.

The projection data is currently being prepared by FPUD staff members. The specific dates for the Fiscal Policy and Insurance Committee to review the information have not yet been set. The committee will make a recommendation to the board.

FPUD combines the district's November and December board meetings, so the next board meeting will be Dec. 7. The implementation of the rates and charges will occur in January or February, which will allow for sufficient public noticing.

Author Bio

Joe Naiman, Writer

Joe Naiman has been writing for the Village News since 2001


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