MV Water District Increases Usage Rates By 4%

By VERNON ROBISON

The Progress

The Moapa Valley Water District (MVWD) approved a 4 percent rate increase to the usage block rate structure, hydrant usage rate, back flow usage rates and payment in lieu of dedication fees at a meeting held Thursday, Nov. 10. The board opted to leave the district’s monthly base rates unchanged.

The increase, which is effective Dec. 1, 2022, is expected to raise the average summer water bill by about $4.16 per month and the average winter bill by $2.37 per month, according to MVWD projections.
MVWD General Manager Joe Davis pointed out to the board that in the current year budget the utility has seen a cash reserve decrease of more than $600,000. This was mainly due to an expected recoat of paint on the East Logandale storage tank, which was approved at the same meeting.

Davis said that the staff had run several projections through the district’s budgeting software and had landed on the 4 percent rate increase for the year.

Board member Ryan Wheeler pointed out that the board had already recently approved the creation of a new usage rate tier for the highest users of water on the system. This was expected to bring in an additional $100,000-$110,000 in revenues each year, he said.

In addition, the district had made moderate increases at the end of each year for the past three years now. Each of these brought in additional revenues of $110,000 to $120,000 each year, he said.

Based upon the idea that the district had already captured the $100,000 increase with the new usage tier, Wheeler suggested that perhaps the annual rate increase could be less than the proposed 4 percent.
“With the tier increase and the 4 percent, it would be estimated that we would have a $200,000 increase,” Wheeler said. “So based on that I am okay with going a little less than the 4 percent. I’m okay with 2 or 3 percent based on this information.”

But other board members worried that going with less than 4 percent would not be enough.
“My biggest concern is getting behind the eight ball again,” said board member Lindsey Dalley. “We have seen this before where if you don’t raise it enough then all of a sudden we are like, ‘Oh man! How are we going to get ahead of this?’ Then all of a sudden we are forced to look at doing 15 or 20 percent increases.

People start shutting their water off because it is too high. Then we get maybe 5 or 6 percent revenue increase from the rate. That really becomes a problem. So I like the trajectory that we are on.”

Board chairman Randy Tobler agreed that he would support the 4 percent increase. He also expressed appreciation to staff for not proposing an increase to the monthly base rate which gets charged to all customers regardless of their water usage.

“I think it is smart to look at the usage rates and leave the base rate alone,” Tobler said. “Water is scarce in the region right now. And with this and with us switching the tiers, it shows a motivation towards conservation so that we are a good neighbor with everybody else out there.”

Board member Kelby Robison wondered about the real impact to the customer in the differences being discussed. “Is the ratepayer really going to notice a big difference between a 4 percent and a 3 percent increase?” he said. “Are they really going to be happier because we did 3 instead of 4? To me the difference is almost a drop in the bucket.”

In the end, Tobler made a motion to approve the proposed 4 percent increase. The motion was adopted with a unanimous vote.

In another agenda item, the board awarded a bid to Olson Precast Company for a recoat project on the East Logandale storage tank in the amount of $420,800.

Davis explained that the district had received four bids on the project. The preferred bid had been with Olson for a two-coat paint system which would have been in the amount of $427,900. This two-coat system had been used by the district before to very positive effect, Davis said.

But then staff received word that the paint needed for this system would not be available until late January or early February.
“That would put us outside of the timeline that we can have the tank offline,” Davis said.

The recoat is expected to take about 10 weeks to complete. During that time, the tank will have to sit empty, Davis explained. Waiting to start the project until early February would have the tank offline well into a higher demand time period as temperatures increase, he said.

A single-coat method would have the paint ready immediately. This method had been included in the bid at the lower cost of $420,800. Both the contractor and the engineer on the project had recommended the single coat system.

“Our biggest question was the durability of it,” Davis said. “From what we are hearing, the durability is still there and the quality of paint is still there. But the proof has to be in the pudding. And unfortunately, we won’t really know until five years from now.”

Wheeler made a motion to award the bid for the single coat process. The motion was accepted with a unanimous vote.