Taking the Broader View

The Los Angeles Department of Water and Power is being reasonable and prudent in seeking a modest water-rate increase this year, in spite of objections expressed by the city’s chief administrative officer. The City Council should take a broader view of financial problems facing the department and approve the increase. Otherwise, the council may face the less-happy prospect of steeper hikes in both water and power bills within a year or two.

The council is being asked to increase the average residential bill by 5.9%, from $21.26 a month to $22.51. The average lifeline bill would decline by 54 cents, from $4.26 a month to $3.72. The city would continue its conservation campaign by further escalating rates during the heavy-use summer months while charging a lower fee in the winter when families use less water. Summer bills would be higher by about 7%. The council debated the issue for an hour Wednesday and then postponed action for 60 days, instructing DWP and the administrator to try to reconcile their differences.

Essentially, the department is attempting to keep up with the cost of living and the cost of doing business. The department also contends it needs additional income to maintain a high bond rating. Keith Comrie, the city administrative officer, argues the department can get by for now without an increase. But a credit report by Moody’s, the bond-rating firm, says the department’s historic ability to implement timely rate increases is a key to good credit.

There is no question that the department faces major increases in operating costs in the near future. Agreements dealing with the city water supply in both the Owens Valley and the Mono Basin will cost millions in coming years. The city also faces new demands for better treatment of its water supply as health and environmental agencies stiffen drinking water standards. Those new treatment processes are very expensive.

Books cost too much, claims the discount book chain owner in a television ad. But it is difficult to argue that water costs too much. The marginal cost of new water supplies, if they can be found, is far greater than the public now pays for the tap water it takes so much for granted. Politically, it should be more appealing for the council to adopt modest incremental rate increases than to shock customers with a massive hike two or three years hence, when the department faces increased operating costs. And from a conservation standpoint, much higher summertime rates for heavy water users should be in order. Only when people think water costs too much will they learn they have to use less of it.