Water rate consolidation process begins this week

On Thursday, Douglas County officials will begin work on consolidating accounting for its eight water companies in an effort to reduce costs for customers of the smallest of them without increasing rates too much for the largest.

With potential rates for some of the county's systems expected to hit nearly $600 a month in the next four years, the consolidation plan could reduce rates for those paying the highest amounts.

The county has taken over different water systems over the years, including three at Lake Tahoe and five in Carson Valley.

The largest water system, located in the East Valley, serves 1,570 homes. The smallest is at the Fairgrounds and serves about 35 homes.

A combination of costs for infrastructure and water treatment has required the county to increase rates for all of its water systems.

Consolidation won't decrease costs for most of the county's customers, but it will help defray costs that might otherwise have been paid by increased housing growth.

Without consolidating the water systems' accounting, water costs for some of the companies will skyrocket by 2014, with Job's Peak Ranch residents paying $577 a month for water, fairgrounds residents would pay $404 and residents of Cave Rock would have $303 a month bills.

Residents served by the East Valley water system are paying $54 a month now, and their rates would increase to $66 a month without consolidation. With consolidation, their water bills would double by 2014 to $108. West Valley residents would also experience an increase in their rates from a projected rate of $85 per month in 2014 without consolidation to $108 a month with it.

In an interview on Friday, County Manager T. Michael Brown said a significant amount of the rate increases is to pay for capital improvements.

"If they had to do the improvements themselves, they would be more expensive," he said.

One way the county was able to save money in the East Valley was to connect to a pipeline from Minden. If a treatment plant had been necessary, the costs would have been greater.

Connecting the water systems physically as well as fiscally would be the best way to save money, but isn't practical for geographically isolated areas like Sheridan Acres and Lake Tahoe.

The county is exploring connecting its water systems to the Kingsbury General Improvement District in much the same manner as it is working on the pipeline between Minden and Carson City.

That project would link the East Valley and West Valley water systems.

"But it's more efficient to administrate and operate them together even if they're not connected. It's the same company providing service, and the costs to operate them are the same," Brown said.

The current rate structure will also help pay to replace the system.

"It allows the systems to pay off their improvements with no dependence on future growth," Brown said.

One problem with consolidating the Lake and Valley water companies is that the Tahoe residential customers are paying a flat rate for water.

Public Works Director Carl Ruschmeyer said irrigation and commercial customers are metered, and there are some Tahoe residential customers who've asked to be put on meters.

Under a proposed schedule the draft findings will be introduced this month, with final results presented in June and implementation in July 1.