In the Loop: With the Hanson Bridgett Government Group

Not long ago, the state of California suffered through a crippling six-year drought, and water conservation was the name of the game. But California’s last two winters have been wetter, and water conservation feels a lot less urgent when the stuff is literally falling from the sky. Even so, scientists agree that droughts are likely to be the state’s new normal, and in any event California law encourages water conservation, with the California Constitution going so far as to actually prohibit wasteful water use.

So how do they do it?

One way is by setting up what are called tiered water rates. The idea is that as residences and businesses use more water than others, they’re charged a higher rate per unit of water. Case and point, a mom and pop restaurant should be paying a whole lot less than a water park. Simple, right?

Well, thanks to other state constitutional laws, water districts have to ensure that rates are based on costs of services, and must be structured in a way that reflect reasonably categorized groups of payors. In other words, the break points between water rate tiers must reflect the costs of providing water service and the benefits that customers receive.

If the water district hasn’t done its homework, customers in one tier may end up paying more than their fair share. If a customer finds their water rate to be unfair, they may very well end up filing a case against the water district, which is bad news for the water district’s wallet.

However, if a water district tasks professional engineers with determining a reasonable way to allocate costs among water users, its rates and tiers are more likely to survive in court.