Cal Water takes heat over San Carlos rates

The changes were initiated to provide a discounted rate for low volume users, incentivize lower consumption, and deal with the increasing cost of surface water, on which the utility district is dependent, Kevin McCusker, director of Government and Community Affairs for Cal Water, said. 

However, residents felt they were not appropriately prepared for such a drastic change, and Mayor John Dugan questioned how well the major policy shift was communicated.

“I’m sitting here as the mayor of San Carlos and I didn’t know this was happening and was blindsided by it,” he said. 

The new rates charge $3.45 per unit from 1-6 units, $13.73 per unit from 7-9 units, $17.16 per unit from 10-13 units, and $25.73 per unit above that. 

According to a public notice placed in the San Francisco Examiner July 16, 2021, the rate changes would begin January 2023 for a three-year period. However, McCuster said approval by the California Public Utilities Commissions was delayed and therefore the rollout of the rate increases was an “unusual unfolding.” 

The process to get approval for newly established rates every three years by the CPUC takes typically 18 months, and usually leads to the adjustments implemented in January of any given year, when usage is the lowest. In this particular case, the bills that would have taken effect January 2023, were delayed until summer of 2024, when use is at its highest. 

Many residents experienced a massive spike in rates during what is already likely the most expensive time of year for water bills. 

Bruce DeBerry, program manager of the water division at the CPUC, could not say why the delay occurred, and said at the meeting it could be due to “various reasons.” 

Regardless of season, the tiered system ultimately harms larger families, residents said during public comment. The cost of the bill is based entirely on water use; square footage, family size, income or other factors have no influence. 

For resident Stephen Wexler, no amount of landscaping upgrades or high-efficiency appliances changes the fact that their family is large, and essential daily activities have to be done, including laundry, dishes and simple hydration. 

“While I commend the idea that water should be conserved, I have three kids, a wife and mother-in-law living at home and my family of six does as best as we can to conserve,” Wexler said. “But the current structure is unjust and punishes larger households like ours.” 

As other utility rates continue to rise as well, Vice Mayor Sara McDowell said rate spikes ultimately burden working-class families. 

“These rates are punishing families too,” McDowell said. “No matter how much conserving families do, we are always going to use more, we do more laundry, we wash more dishes, we take more showers.” 

McCusker said the discount rate was aimed toward low-volume and low-income users because “there’s a giant overlap of those two groups.” McDowell said the consideration isn’t targeted enough. 

“Everyone uses the sewer system, everyone uses the water system,” McDowell said. “I understand the price break to help people who are lower income, but you’re also giving a price break to one- and two-person households who could be quite wealthy.” 

Cal Water is not looking to punish for the amount of water they use, McCusker said, but it also wants residents to migrate toward more conservation, and are doing so through price incentives. 

“Nobody is saying that it is wrong to use this level of water and nobody is saying we’re immune to concerns customers have if they have this type of water use profile,” McCusker said. “The point is to show that it’s not the typical scenario in the city of San Carlos. 

“What we’re hoping is that as people see some of these increases in bills, that they will take advantage of some of the rebates and programs that are out there to help them reduce their water usage,” McCusker said.

Conservation programs include the lawn-to-garden turf replacement rebate and a landscape site evaluation. Residents should take advantage of these programs because they’re include in their bill, McCusker said, and can visit calwater.com/conservation to see lists of items available for rebate. 

Regardless of rate structures and the necessary increases, Dugan said the communication of the policy change was insufficient and could not be justified.  

“If there’s a major policy change afoot, that’s what has to be understood by your public or you will have a lot of surprised folks so I would express that is unwise at best,” Dugan said. “There is some merit to encouraging conservation but that is now largely being lost because it wasn’t explained and people are just seeing the larger pricing.”

Although the city does not have jurisdiction over these rates, Dugan said the council has a responsibility to listen to and mitigate resident concerns. 

Despite concerns from residents over transparency from Cal Water, McCusker said residents are able to get involved and provide input by following the process every three years. 

The CPUC is currently considering the latest rate consideration filing from Cal Water, which could be implemented January 2026. A public participation hearing where residents can provide input is most likely to occur in January 2025, DeBerry said. 

McDowell recommended the council reach out to local legislators for further investigation into how the rate increases were implemented.

“I think we need to amplify the voices we heard here tonight and I would also like to have continuing meetings in our community to understand rates coming forward,” McDowell said.