Pleasanton Council Votes To Delay Proposed Water Rate Hikes

PLEASANTON, CA — The Pleasanton City Council voted Tuesday to delay a controversial plan to raise water rates by 62 percent over the next three years. Council members voted to conduct further analysis based on numerous resident concerns, and reconsider the hikes at their Nov. 7 meeting. The council voted unanimously to delay the vote, though Councilmember Julie Testa left before the vote due to a family emergency.

“You’ve raised many valid comments and questions, but I’m going to suggest that we delay the decision to the next meeting so that we can address the issues you brought up,” said Mayor Karla Brown. “You have questions about those bills, we’ll answer those questions. We’ll put information on the website. We’ll make it clearer on the website if something isn’t there.”

Council members Valerie Arkin, Jeff Nibert, and Jack Balch voiced similar sentiments, with Balch noting that he said during a July vote that there were too many unknown variables for him to vote in favor of advancing the process.

Initially, the council approved a motion to delay the decision until their next meeting on Oct. 3, but moved the decision to the Nov. 7 meeting following a request by City Manager Gerry Beaudin.

In July, the council voted 4-1 to advance a proposal to increase rates by roughly 30 percent starting Nov. 1, which staff said would amount to roughly $33 more every other month for the average single-family residential customer. That would be followed by a 20-percent increase starting Jan. 1, 2025, and a 12-percent increase on Jan. 1, 2026.

City staff say that the significant increases are vital to keeping up with rising costs and restoring a diminishing water fund. For the past three years, per a council vote in 2017, the city has not implemented any rate increases, and Pleasanton water prices are currently the lowest in the region and will remain so even with the increases, according to staff.

Costs have outpaced revenues, and the city is drawing on reserve funds to cover costs. If current rates remain in place, the city’s Water Enterprise Fund will be insolvent by 2025, staff estimate. By fiscal year 2026, it could face a deficit of $26 million.

Staff say that the increases will enable the city to meet its reserve policy targets of 35 percent of operation and management costs for fiscal year 2026, maintain adequate debt coverage, and better position the city for future repairs. The city will not profit from the increases, which is illegal in California.

After stabilizing the situation and drafting a Water Master Plan, the city hopes to embark on a more long-term Phase II to address PFAS, begin replacing pipes and other infrastructure improvements, and shoring up supply issues for droughts.

Over 1600 residents signed a change.org petition that spoke out against an “unjustifiable water rate hike proposal that threatens to burden our community with exorbitant financial strain.”

“Our water bill would potentially be increasing up to $1700+ (or more) per household on a yearly basis, adding a crushing annual burden,” the petition continued. “Pleasanton's water rate is skyrocketing by an alarming 300-700%. These figures have been verified with City Staff, lending credibility to our concerns.”

Petitioners acknowledged the need to raise rates, but requested a postponement of rate increases, further explanation of how the money will be spent, a delay of non-mandatory rate increases, and a better use of existing funds.

At Tuesday’s meeting, dozens of residents voiced lengthy concerns over the proposed rate hike that resulted in the vote to delay. Common concerns included:

• Confusion over how the new rates were calculated, and whether projections are accurate. Several residents voiced concerns that their new bills would be much higher than expected.
• Concerns that the city had not adequately informed residents of the changes, or provided the information in a clear way. Some residents claimed that a brochure sent to residents was confusing and/or misleading.
• Concerns that some of the increases are not necessary.
• Advocacy to only raise rates for a year, then reassess.
• Concerns that the new rates will lead to unintended consequences, like dying lawns because many people will no longer be able to pay their bills.
• Concerns over how long-term capital improvements will be financed.

The city has created a website called pleasantonwater.com to answer questions about all aspects of the city’s water supply. See here to watch the meeting.