LVVWD Board approves credit on fire line charges
The Las Vegas Valley Water District (LVVWD) Board of Directors on Aug. 7, 2012 voted to adopt the Southern Nevada Water Authority (SNWA) non-residential fire line credit, equal to 50 percent of the assessed non-residential fire line surcharge.
This credit is effective Aug. 8, and will reduce costs primarily to businesses and nonprofit entities impacted by the recently approved infrastructure charge. The temporary credit will remain in effect for three years or until a newly formed citizens advisory committee recommends alternative options.
The Board action was in response to local businesses and nonprofits, which have expressed concerns about the financial impacts of the infrastructure charge, particularly as it relates to fire lines. Fire line charges are incurred only by businesses or other organizations that receive fire protection from this infrastructure, not the community as a whole. In the past, fire lines were subsidized by connection charges, which have decreased more than $180 million since 2006.
To help replace this lost revenue and repay debt service on critical water facilities, the SNWA Board in February adopted the infrastructure charge, which is based on meter size.
Revenue to fund the fire line credit would come out of the SNWA rate stabilization fund, which was established to help offset potential future rate increases. The fund includes approximately $44 million in unanticipated revenue from enhanced bond refinancing terms and surcharge collections that began earlier than originally projected.
A 21-member Integrated Resource Planning Advisory Committee, formed by the SNWA Board in May, will review the rate structure, stabilization fund, operations and water resources, and present long-term recommendations.
LVVWD Board approves SNWA infrastructure charge
The Las Vegas Valley Water District (LVVWD) Board of Directors approved on March 6 the Southern Nevada Water Authority (SNWA) infrastructure charge increase.
The SNWA infrastructure charge, which was approved by the SNWA Board of Directors at its February meeting, will pay for large water system projects, including a critical new intake designed to protect Southern Nevada during severe drought conditions.
The SNWA Board considered three alternatives, and opted for the one that had the least impact on residential customers. The SNWA Board also included an amendment setting a reduced fixed rate for fire meters at 35 percent of the infrastructure charge.
The charge is based upon the customer's meter size. Residential customers with 5/8 inch and 3/4 inch water meters will see a monthly increase of approximately $5, while small retail stores will pay about $36 more for water service. Large customers such as resorts will face increases of about $2,200 per month.
This increase was effective April 1, 2012.
SNWA Infrastructure Charge Rates
The three-year infrastructure charge is based on your meter size and are calculated daily. The monthly charge depends upon the number of days in that month's billing cycle. Most residential customers have a 5/8" or 3/4" meter. Find your meter size on your monthly bill directly above the usage chart.
Approximate monthly charges per meter |
|||
|---|---|---|---|
| Meter Size (inches) | Residential | Non-Residential | *Fire Meter (full cost before 50 percent credit) |
| 5/8 and 3/4 | $5 | $19.05 | $6.67 |
| 1 | $19.21 | $36.08 | $12.63 |
| 1.5 | $38.41 | $72.16 | $25.26 |
| 2 | $61.46 | $115.45 | $40.41 |
| 3 | $122.90 | $230.90 | $80.82 |
| 4 | $192.03 | $360.79 | $126.28 |
| 6 | $384.05 | $721.57 | $252.55 |
| 8 | $614.47 | $1,154.50 | $404.08 |
| 10 and larger | N/A | $1,659.59 | $580.86 |
| *Beginning September 2012, non-residential customers will receive a 50 percent credit on the fire line charge. | |||
Reason for the Increase
The increase will help offset significant declines in connection charge revenues as well as continue to fund improvements to critical water-treatment and transmission infrastructure.
Although the Water Authority has been able to stave off the increase for more than three years through significant expense reductions and the utilization of reserves, the SNWA Board's concern about the agency's financial stability compelled the decision. Since 2006, connection charges for new customers–which fund the majority of capital projects–have plummeted from $188 million to as low as $3.2 million in 2010.
SNWA maintains one of the country’s largest and most-advanced water-treatment and distribution systems, and is the wholesale water provider to the Water District.
LVVWD customers will continue to have water rates well below the average of most Western cities.
