TMWA to look at rate hike and new construction fee

The Truckee Meadows Water Authority

at an all-day strategic planning meeting next

month will discuss its five-year financial

forecast, including a possible connection fee

for new construction.

TMWA also is considering a rate

increase, according to participants in a meeting

of the TMWA's technical advisory committee

held late last month.

"TMWA basically adopted all of Sierra

Pacific's rules and regulations," when it took

over the water system from the power company

a year ago, said John Erwin, manager of

water resources at TMWA in Reno. "Much

of the way we recover costs is through usage

charges and that doesn't capture the costs of

building new storage tanks, etc."

Currently, all ratepayers including

those in growth areas pay equally for the

costs of new facilities.

To remedy that, the TMWA is considering

charging a connection fee for new construction

as a way to handle growth in the

region.Tentative estimates of the fee will be

discussed at the public meeting Oct. 9.

In addition,TMWA may raise rates,

possibly by 3.5 percent, though Erwin

warned that the exact percentage has not

been determined. The focus of that rate

increase, which wouldn't take effect until

after June 2003, would likely be on existing

flat-rate customers as way to induce them to

move to water meters.

The TMWA was formed last June

when Sierra Pacific sold the water system

to Reno, Sparks and Washoe County governments.

At the time,TMWA promised

not to raise rates for at least two years.

The TMWA is also looking at ways to

cut costs to minimize the rate increases. One

option is to provide untreated water, rather

than potable water, to customers with large

turf areas for the watering of those lawns.

The customers now being considered for

that are the Washoe County School

District, Reno High School and Idlewild

Park, which is close to Reno High.

Also in October,TMWA will submit its

annual financial report to the board for

approval. Preliminary results showed that

revenues are $350,000, or 1 percent, under

budget, while operating expenses are $1.90

million, or 5 percent, under budget, resulting

in an operating income of $1.55 million, or

8 percent, above budget.

The report said: "The primary reason for

the higher than expected operating income

is depreciation expense, which was

$1,390,000 under budget."