The Sonoma County Water Agency is proposing to use $6.6 million, more than half its reserve fund, to prevent drought-related conservation measures from causing steep rate hikes for more than 600,000 customers in Sonoma and Marin counties.
Two key Water Agency advisory panels passed a non-binding resolution Monday calling on the agency's municipal water system contractors to ask their customers to cut residential water use by at least 20 percent to preserve the dwindling supply in Lake Sonoma, the region's main reservoir.
As of Monday morning, the reservoir was down to about 65 percent of its normal capacity. Without significant rainfall or major conservation efforts, the reservoir is less than a year away from the point at which the agency would be forced by the state to ration water to the cities downstream, engineers say.
But that conservation effort could have a perverse effect on water rates, causing them to go up. Rates are set by a simple calculation, agency Administrative Services Manager Michael Gossman said, dividing the costs of operations every year by the amount of water sold. Selling less water saves little on operational costs, meaning each gallon sold must become more expensive to pay the bills.
Previous dry spells have led to such rate hikes, causing "consternation and angst" among ratepayers, who were surprised to find their conservation efforts rewarded only by higher bills, Cotati Public Works Director Damien O'Bid said.
In the face of a record-setting drought, the Water Agency decided to head off that possibility this time by using some of its reserves to subsidize the lost revenue from water conservation.
In this unusual situation, "we thought it was prudent to go to the reserves," agency General Manager Grant Davis said at the joint meeting Monday of the Water Advisory Committee and the Technical Advisory Committee in Santa Rosa.
Before the drought, Gossman said, the agency had been projecting wholesale rate hikes of about 4.38 percent to its municipal water customers in the 2014-15 budget, which the cities might pass on to local ratepayers. But the agency now expects to see water deliveries drop about 10 percent in response to the drought, including the cut in residential use recommended by the two panels Monday.
Using the normal rate calculation, that would force a rate hike of up to 13 percent, Gossman said.
"That was a bit steep and it would be pretty hard for people to handle," he said.
Dipping into the reserve fund will lead to a projected wholesale rate increase of only 3.19 percent to 3.6 percent for most of its municipal contractors, he said.
The agency supplies water to more than 600,000 residents and businesses in Santa Rosa, Windsor, Rohnert Park, Cotati, Petaluma, Sonoma and water districts in Sonoma Valley and Marin County.
The Water Advisory Committee will consider the proposed budget in early April. It will come before the county Board of Supervisors, which oversees the Water Agency, for final approval by April 30. The new rates would go into effect after July 1.
Water managers are scrambling to save water after 2013 turned out to be the driest year on record in California, with just 8.71 inches falling in Santa Rosa the entire year, about one quarter of the normal rainfall.
Lake Mendocino, which supplies cities north of Lake Sonoma, is down to just 36 percent of its normal capacity. The agency has secured state permission to drop flows in the upper Russian River to the lowest possible level to preserve what little is left in the reservoir.
Those reduced flows, Assistant General Manager Pam Jeane said, saved nearly 1 billion gallons in January alone, but it left the upper river looking parched.
"It looks very much like it does in the summer; the river is small, very much in the center of the channel," she told the advisory panels. "It does not look at all normal for this time of year."
Sunday's rainstorm, which dropped about 0.6 inches in Santa Rosa, boosted the flow in the river and some of the tributaries, she said, but did nothing significant to recharge the two reservoirs.
If dry conditions persist, she said, the agency might ask state permission in the spring to drop flows from Lake Sonoma as well, which would drop flows in the lower part of the river.
The cities above Lake Sonoma, including Healdsburg, Cloverdale and Ukiah, face a dire shortage of water, since they have no alternative to using the river and Lake Mendocino.
Last week, the state Department of Public Health warned that Cloverdale and Healdsburg were two of 17 cities and water systems statewide in imminent danger of running out of water.
Healdsburg officials responded days later, saying the city was not under any immediate or foreseeable threat of running out of water. Officials cited secondary groundwater sources that were "recharging at an appropriate level."
Mendocino County declared a water emergency in early January, followed by a statewide declaration by Gov. Jerry Brown two weeks later.
The city of Willits, also on the Department of Public Health's list, imposed a 150 gallon per day limit on each resident on Jan. 8.
The Healdsburg City Council voted to impose a 20 percent mandatory cut in water usage on Jan. 21, including a partial ban on outdoor uses. The next day, Cloverdale voted to impose a 25 percent cut.
Cities south of Healdsburg are in better shape, since they can count on Lake Sonoma water, but even they have been asking for voluntary cuts. The Marin Municipal Water District, which receives part of its water from Lake Sonoma, has already imposed a 25 percent voluntary reduction on customers. Cities in Sonoma County are considering voluntary programs to cut from 15 percent to 20 percent.
Water managers and elected officials at Monday's meeting said they are waiting until April to see whether it is necessary to impose more stringent mandatory conservation. They are hoping more rain by then will ease the situation before the dry summer season begins.
But, warned Supervisor Efren Carrillo, a Water Agency representative on the Water Advisory Council, "I think mandatory (restriction) has to be on our minds if dry conditions continue."
You can reach Staff Writer Sean Scully at 521-5313 or sean.scully@pressdemocrat.com. On Twitter @BeerCountry.
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