Las Virgenes Metropolitan Water District (LVMWD) held a public financial planning workshop on April 18th. During this meeting, District staff presented their estimates of operating expenses over the next five years for water, sanitation and recycled water funds. Staff believes that it will be necessary to raise water rates to cover increased operating costs currently funded by reserves. These increases in water rates are on top of the pass through rate increases expected from it’s supplier (the Metropolitan Water District).
District staff was asked if rate increases can be averted. Staff revealed that reduction or elimination of certain infrastructure projects, such as the proposed water storage tank, can make a substantial impact through reduction or delay of rate increases. That said, staff indicated that if their projected operating expenditures are not cut further, rate increases cannot be eliminated entirely.
Staff also informed the Board that one of the impacts of water conservation has been reduced revenues for LVMWD compared to forecasts. The District has reduced expenses during the same period, partially offsetting the revenue drop, but expects rates per water unit to increase with further conservation. The issue is that conservation could cause an increase in the per unit cost of water, but lower the total water bills for customers. This is due to the overhead costs for delivering water being spread over a smaller quantity of water units. While most customers are likely focused primarily about their total bill (which includes sewage treatment), some could be confused by unit increases. The water district is concerned about educating customers about how despite higher per unit rates, conservation could lead to a lower overall bill.
In addition, this week, LVMWD notified the public that it has won two awards (The Certificate of Achievement for Excellence in Financial Reporting, and Distinguished Budget Presentation Award) from the Government Finance Officers Association, a national nonprofit association headquartered in Chicago. LVMWD’s Director of Finance and Administration, Sandra Hicks (a resident of Westlake Village), was presented the Certificate of Achievement for Excellence in Financial Reporting for the District’s comprehensive annual financial report (CAFR).