sector – and in particular if farmers are fallowing their fi elds in order to make that water available. That can raise concerns, but I think that there are ways to deal with that by making sure that you’re providing enough money from those sales to support the local community and do it in a sustainable fashion.
Sue McClurg: What about water rates and the struggle that utilities have with raising rates for various reasons?
See an interactive map of per capita water use around the state from the PPIC.
Davis: I think one of the challenges we have is the type of water rate structures that we have. And there’s nobody who’s done it better than Irvine Ranch Water District in thinking through reconfi guring water rates so that you’re not just trying to send a message about volumetric usage, but you’re actually structuring the rate so that you’re covering your fi xed costs at the same time you’re rewarding your customers that are using the right amount of water for their landscape and their household. It takes a lot of work on the front end to set it up, but it does the really hard work of aligning the message about conservation and water effi ciency with the economic reward to the customer who’s doing the right thing with making sure that the water agency’s fi xed costs are being covered within that rate structure. It’s the next generation of rates that – given the success of Irvine Ranch – there are a large number of agencies throughout California that have started to adopt these rates; there’s really no excuse any longer for water agencies to complain that somehow the rate structure is a problem for water conservation. We need, as an industry, to shift our rate structure so there’s an alignment between covering our fi xed cost and having the right conservation message. The second part of your question goes to the relationship between a water agency and its customers. How we talk about our service. How the customers feel that they’re getting value for the services that are being received. Those agencies that have
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been really successful at getting the rate increases are the ones who really have that conversation going. So when they talk about that next investment that’s needed whether it’s for ground- water quality treatment or putting in a recycled water system, it’s the way in which the community understands the value of that infrastructure invest- ment that enables them to support it. And those are the ones that have been successful. They have the ability to communicate clearly what needs to be done and why and how that customer is going to receive value from it. If the customers believe it, they’ll vote for it.
Hanak: We’ve been living with the backlash from the recent multi-year drought where a lot of agencies were not practicing the kind of rate struc- ture that Martha just talked about, and they were basically relying on those upper tiers in order to cover some of their fi xed costs. Well, then you get a drought and you’ve got to ask everybody to conserve. Everybody conserved. That was great. And then at the end of the summer you fi nd out the utilities are not able to cover their costs. They’ve got to go back and raise the rates. Then everybody is very unhappy about it because they thought that they were going to be saving money. The messaging was just off. I think people are smart. They’ll under- stand if you tell them, “Look, we’re in a drought. That means we’ve got to raise the per-gallon charges in order to be able to cover our costs.” I think it actu- ally created an opportunity now going forward to kind of clear the decks and start corrections.
McClurg: What about a region like Sacramento where there are few water meters?
Leavenworth: You have to consider the whole issue of water rights. Sacramento has very old water rights. It’s gotten water very cheaply, so that it hasn’t driven the need to do water meters and volumetric pricing. It’s much different for a Southern