press release

August 27, 1998

FOR IMMEDIATE RELEASE

WATER RATES TO REMAIN STABLE FOR SWEETWATER CUSTOMERS

At its last regular meeting the Governing Board of Sweetwater Authority adopted a $28 million budget for fiscal year 1998-1999. The budget included $14 million in capital improvements, including pipeline replacements, tanks, equipment and $5 million to complete the construction of Phase I of the Lower Sweetwater River Demineralization Facility. The new facility, currently under construction near 2^nd Avenue and Sweetwater Road in Chula Vista, will provide 4 million gallons of local water, about 20 percent of daily demand, to customers in early 1999. The facility will enable Sweetwater Authority to reliably provide 70 percent of its average water demand through local supplies. (Countywide, San Diegans receive only 10 percent of their water from local water sources.)

The $14 million operating budget included increased costs related to increased regulation and water quality issues. However, the Directors voted to offset such costs through its rate stabilization fund and by implementing cost-cutting measures in other areas. The net result was a budget which projects the agency will meet its operating costs without any rate increases prior to July 31, 1999.

The Board left unresolved questions related to potential new charges which the San Diego County Water Authority or the Metropolitan Water District of Southern California may impose on each water customer to pay for the cost of regional projects to increase emergency water storage. The structures and amounts of such fees are currently under negotiation among the wholesale agencies' member agencies.