Napa proposes hike in monthly water rates to help offset rising operational costs

The city of Napa is set to consider an increase to water rates for the first time in two years to cover the increasing costs of providing service.

The Napa City Council will hold a hearing Nov. 7 to adopt the new rates. If approved, they would be effective Jan. 1 and customers likely would see the impact on bills in March and April, said Joy Eldredge, deputy city utilities director.

The recommended increase will typically add up to about $5 each month in the winter and $10 each month in the summer for average users — between 4,000 and 8,000 gallons — each year until 2028 for residential users within the city.

There hasn’t been a water rate adjustment since October 2021, Eldredge told the City Council on Sept. 19. Currently, she said, the department’s operating costs have gone up so much the department is running into a $6.8 million annual deficit.

The department is also recommending similar increases to multifamily residential rates, commercial water rates and rates for irrigation — each would increase a little less than $1 for every 1,000 gallons used per month until 2028.

The increase would set the city up for a future bond issuance in 2027, to pay for significant capital improvement needs, including an $80 million upgrade to the city’s treatment plan that serves its main Lake Hennessey reservoir, a $10 million Hennessey spillway expansion, and upgrades to water transmission.

“The (rate increases) are necessary so that we can continue to operate the system, have the ability to purchase our water supplies as we do each year and continually continue to invest in infrastructure,” Eldredge told the City Council.

“If you don’t invest in infrastructure, it doesn’t go away. The costs become larger later. And you lose the reliability of your system.”

With the increase, the average monthly charge of $72 during the summer for about 8,000 gallons would still be below the average cost of about $96 in the Bay Area.

The entirety of the city’s water infrastructure, if built today, would cost about $941 million, she said. That includes three water treatment plants, 14 storage tanks, 10 pump stations, 11 regulator stations and 360 miles of pipeline, all of which serves over 25,500 water service accounts.

The annual budget for the water system is currently about $38 million, Eldredge said. That pays for 68 full-time staff members who run a 24/7 operation at the treatment plant and about $6 million invested in capital improvements, among other costs.

And about 90% of the cost to run the system comes from bimonthly water bills, Eldredge said.

There have been several areas where the department has seen large increased costs in the past few years, according to Eldredge, including a roughly $2 million increase to the cost of water purchased from the California State Water Project over the past three years.

Napa Mayor Scott Sedgley said the council has a responsibility to prepare for future generations, which includes making sure the city’s water infrastructure is maintained.

“It’s always uncomfortable to consider raising rates, especially in times like this when the economy is not great and people are paying more for everything,” Council member Mary Luros said. “But we do have a duty to cover our costs.”

You can reach Staff Writer Edward Booth at 707-521-5281 or edward.booth@pressdemocrat.com.