press release

July 26, 2001

For Immediate Release

POWER COSTS AND DRY WEATHER IMPACT WATER RATES

The Governing Board of Sweetwater Authority will consider a 6.9 percent increase to water rates, effective September 1, 2001, at a public hearing on August 8 at 6 p.m. The hearing will be held during a regular meeting of the Sweetwater Authority Governing Board, in the Boardroom at 505 Garrett Avenue, Chula Vista.

The proposed rate increase is necessary, say Board Members, primarily for higher power costs, the need to purchase a large percentage of imported water to meet local demands following two dry years, and higher prices charged by wholesale agencies for imported water.

The average residential customer will pay about $2.33 more each month, with water use of 25 units per two-month bill. Of that amount, 65 cents will be placed in a reserve fund to cover the estimated portion of Sweetwater Authority's power bills held in a "balancing account" by the utilities under the rate freeze established by the California Legislature earlier this year. To keep rates from rising even more dramatically, the Board approved deferments in capital improvements, equipment purchases and building reserves. Budgetary cuts were made throughout the organization to reduce the operating budget for the fiscal year starting July 1, 2001. Reserves of $1.7 million were used to help offset some of the power cost impacts for fiscal 2000/2001 and 2001/2002.

"We started this process facing a 25 percent increase," said the General Manager. "I am pleased we could arrive at a figure which meets our goal of avoiding economic hardship to our customers while protecting the financial stability of Sweetwater Authority."

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