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Riverside to vote on higher rates for water and electricity

The Riverside City Council will decide Tuesday, May 22, whether to start charging residents more for water and electricity.
The public meeting comes after the council voted 5-2 in January to give “conceptual approval” to the increases, which will cost the average customer about $3.10 more per month for electricity and $3.50 more per month for water.
If approved, the 2.95 increase in electric rates and 4.5 percent increase in water rates would go into effect July 1. Further increases are planned for the next five years — averaging 3.0 percent per year for electricity and 5.7 percent annually for water — but will be reviewed by council members each year.
Officials with Riverside Public Utilities say revenue from the increase is essential to finance infrastructure, renewable energy and utility operation costs, as well as to maintain strong bond ratings and low debt costs.
Some things have changed since the January vote.
Cuts, including eliminating five positions and transferring nine positions from utilities staff to city staff, are expected to save about $4 million annually.
An audit to find additional ways to save money also is ongoing, and the utilities are operating under an interim general manager —  Todd Jorgenson — and Riverside has an interim city manager.
Because of that, some people are arguing to hold off on any increase.
“I don’t think today or now is the time for increases,” said Councilman Chuck Conder, who voted against the increase in January, along with Councilman Steve Adams. “We’ve just started an audit over there. We don’t know what the numbers will be. We’ve been given incorrect numbers too many times in the past. A year is not going to do any damage.”
That’s one of the arguments Jorgenson hears often, but he says a year’s delay will mean steeper increases in the future and reliability problems — meaning more power outages and more burst pipes.
And he said it’s not that the old numbers were wrong; staffers dug hard to find these savings so they could make the budget work.
“So people wonder, ‘Doesn’t that mean you could still find more savings if you looked again?’” Jorgenson said. “We wouldn’t be able to cut more, because first of all, we had to dig deep to find these. That’s just to make us come out whole. Second, the amount of money we need to keep funding the utility and keep up w our cost increases, it simply wouldn’t be enough.”
The increases are projected to bring in an average of  $35 million more for each of the next five years.
Jorgenson said another common question is why the utilities have such large reserves.
While it has about $411 million in reserves, most of that can’t be used, he said. About $132 million is legally restricted — to pay for San Onofre cleanup, for example — and about $90 million is designated for already-planned projects .
That leaves $189 million, about one-third of which the utilities now plan to spend.
“We’re starting at the upper end of our acceptable range (for reserves), and we’re going to end at the bottom of the acceptable range,” he said. “Any lower, and our interest rates will increase.”
Planned Rate Increases
Electric
July 2018: 2.95%July 2019: 3%July 2020: 3%July 2021: 3%July 2022: 3%
WaterJuly 2018: 4.50%July 2019: 5.75%July 2020: 5.75%July 2021: 5.75%July 2022: 6.50%
Source: Riverside Public Utilities
If you go
What: Council will vote on whether to increase utility rates
When: Tuesday, May 22, at noon and 7 p.m.
Where: 3900 Main St., Riverside

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