Milpitas water, sewer rates rise

The Milpitas City Council on Tuesday unanimously approved multiple increases to the city’s water and sewer rates that will take effect over the next four years, and raise residents’ bills significantly.

An average residential customer will see their water rates jump by about 30 percent, fixed water meter charges climb by about 75 percent, and sewer rates rise by about 37 percent between April 1, 2019, and July 1, 2022.

A subsidy program also was approved to allow mobile home residents to pay less for their sewer bills, and some council members also asked staff to consider ways to extend utility bill assistance to lower income households, apartment tenants, and possibly federal workers in the future.

The council, in voting to approve the new rate schedules, agreed with city staff that more funding is needed to maintain

and upgrade decades-old infrastructure that moves water and waste throughout the city.

Milpitas will need to spend about $46.3 million over the next five years to upgrade water supply systems and facilities, city staff said, and about $75 million to pay for needed upgrades to the sewer system.

The lion’s share of the sewer system upgrade costs — $65 million — represent the city’s contribution to the San Jose-Santa Clara Regional Wastewater Facility between this year and 2022. Milpitas contracts with the facility — which is undergoing major upgrades — to treat the city’s sewage.

Tony Ndah, the city’s public works director told the council it’s imperative the city be able to fund infrastructure maintenance and replacements proactively, to avoid costly onetime fixes when pipes burst, leak, or otherwise fail.

The city maintains about 200 miles of water pipes, as well as 179 miles of sewer pipes.

“Our pipelines have been in place since the 1950s, when this city was first incorporated,” Ndah said at the meeting.

“And they don’t really say anything to you until Montague Expressway happens,” Ndah said, making reference to a massive sinkhole that opened up on Montague Expressway in January, causing traffic diversions and requiring a hasty repair.

An average Milpitas resident in a single-family home currently pays about $109.44 for their total water bill every two months,

“Even going up even 10, 15, 20 dollars means that’s one night you don’t eat, that’s one trip you don’t take, that’s gas you can’t put in your car. So I think that we just need to be aware of that when these rates go up.” — Councilman Bob Nuñez

Ndah said. That customer’s bill will now increase to $116.47 after April 1, and jump four more times between July 1 and July 1, 2022, according to city staff reports.

The increases in rates also are also needed because the city’s cost to buy water is increasing, Ndah said. The Santa Clara Valley Water District — which supplies about a third of the city’s water — is planning steady increases in the wholesale price it charges Milpitas over the next five years.

The San Francisco Public Utilities Commission, which supplies the other two-thirds of Milpitas’ water, has been charging the same rate for water since 2016. Ndah expects it to stay at that rate until about 2022, when a nine percent increase in the price for water is planned.

Sewer rates will jump, as well. Currently, residential customers pay $90.27 every two months for sewer service, but that will increase to $124.14 by July 1, 2022, under the newly approved rates.

To help offset the impact to ratepayers, the city plans to seek bonds to finance about $20 million of the needed water infrastructure upgrades, and about $35 million of the sewer expenses, city staff said.

As a result, while most portions of a customer’s water bill will increase, the new rates include a reduction in the capital surcharge portion, which is used to cover improvements to the system. The surcharge will drop from $1.30 for each 748 gallons a customer uses to $1.08 for the next five years.

“Even going up even 10, 15, 20 dollars means that’s one night you don’t eat, that’s one trip you don’t take, that’s gas you can’t put in your car. So I think that we just need to be aware of that when these rates go up,” said Councilman Bob Nuñez, who asked staff to explore other subsidies for lower-income residents as well.

Vice Mayor Karina Dominguez raised similar concerns, and specifically asked that staff consider ways to protect federal workers living in the city who might be vulnerable during another government shutdown, and could need “one-time hardship” assistance.

She also said tenants should be protected from the potential impact of the rate increases.

“My concern is again that vulnerable families may experience a dramatic rental increase, with the excuse that your water and sewer rates have gone up,” she said.