Sticker Shock: Cost of Water Could Skyrocket Starting This Coming August

Smoothing water rate increases has been Oro Valley's history
Each year, the town raises the cost of water by 2-3%. According to Oro Valley Water Director Peter Abraham, addressing the town council last week, the objective has been to smooth rate increases over time to account for inflation and the ever-increasing cost of operating the system, so that there is no 'sticker shock'.

But next year water cost could skyrocket
Starting in August, your water bill will increase by 8.3% for some and up to 26% for others if a proposed water rate increase is approved by the council in June. Last week, the council took the first step in doing just that by approving the posting of a notice on new water rates for 2024-25.”

The proposed water rate increases are in three pieces:

• A 5% increase in the base connection rate 
• A 10% to 40% increase in the cost of the amount of water consumed, depending on how much is used. 
• A 12.5% increase in the groundwater preservation fee

In addition, these added costs are increased by the taxes residents pay on the water portion of their bills. (See panel)

Abraham notes three reasons for the need for these increases

• First, water rates that were set too low in fiscal 2023 last year causing a $843,000 shortfall in revenues. These revenues must be recouped in order to shore up required reserves. Sad but true: The less water the community uses the more the cost per gallon. That is because the water rate is computed based on an assumed number of gallons used. So, if residents use less total gallons than the projected number of gallons, as they did in fiscal 2022, the revenue raised will be insufficient to cover cost.
• Second, CAP is going to bill towns for CAP water at higher rates; and Tucson Water is increasing its fee to Oro Valley for bringing (“wheeling”) CAP water to Oro Valley.
• Third, there are needs for system improvements and these are funded on a "pay as you go" basis

Even after these increases, Abraham notes, the cost of the water component of the bill is less than that of Marana and Tucson.

The town is looking for more ways to make water even more expensive 
In the past, Abraham has stated that Oro Valley has reached a point where conservation has peaked. However, he has decided that increasing water costs will further promote conservation. He announced that the town is looking to update its water rate model. The tentative plan is to add the "Winfield Tier," a water consumption tier for usage of up to 3,000 gallons. This is the amount that the Mayor and his family use.

There will be a public hearing on the proposed rate increase in June
We do not expect any public opposition because people may not know how to oppose this type of rate increase. That will be up to the Town Council. Based on council comments at last week's meeting, we anticipate that only Council Member Bohen may mount any substantive challenge, if indeed one does happen. The rates will go into effect on August 1.

Big increase is really bad timing… Just another nail in the cost of living fisaco...The town can help if it wants to
The proposed water cost increase comes at a really bad time. Every living cost is up substantially, from the Southwest Gas bill to the cost of gasoline. Every product you buy at Fry's is 30% more than it was three years ago, and the cost of prescription medicine is up as well. Additionally, a large majority of people in Oro Valley live on fixed incomes. Perhaps the town should find a way to smooth this significant increase over several years to alleviate the burden on residents.

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