Business owners served by the Golden Hills Community Services District may find their water bills altered should changes in how rates are calculated go forward.
CSD board members approved a date for a protest hearing, set for Sept. 18, to adjust rates for commercial users.
The board approved setting the public protest hearing, required under Proposition 218, with a 3-1 vote. Board president Ed Kennedy voted no.
Director Kathy Cassil recused herself, citing a possible conflict of interest.
If the proposed changes are adopted, commercial water rate payers will be charged a monthly $50 flat fee for each water meter connection. The district's charge of $2.66 per 100 cubic feet of water used will remain intact.
The current flat connection fee is $21.26 for both residential and commercial accounts, according to the district's rate schedule.
According to Bill Fisher, general manager of Golden Hills CSD, commercial water users previously had access to a discount of the first 500 cubic feet of water used during each billing cycle. That discount will end if the new rate structure is adopted.
He said the proposal came after a discussion with a commercial property owner in Golden Hills.
"He expressed some concerns about the existing rate structure that we have in place," Fisher said. "In discussing this, he asked that we look at this."
Fisher said the district serves approximately 100 commercial properties in Golden Hills; 50 have a single residence and 50 have multiple businesses.
He said following legal counsel's advice, the public hearing would only require a majority protest hearing. Per Prop. 218 regulations, a notice would be sent out to those effected by the change, as well as published in local media.
The rate increase would pass unless a majority of the property owners who have commercial water meter hookups file a written protest before the hearing ends.
The increase would remain in effect until September 2019.
Kennedy, the board president asked if the rate change would result in a net increase or decrease for commercial accounts.
Fisher said half the accounts could see an increase in the base rate because the properties are occupied by a single business.
A property with multiple businesses could see a possible decrease.
"A lot also hinges on water consumption," Fisher said.
Kennedy expressed reservations that because the matter was an action item, it might not give commercial customers enough of a warning about the proposed rate changes.
Ernest Conant, legal counsel for Golden Hills CSD, said that the Prop. 218 notice allows the board to simply enact the rate increase. It could choose not to implement it based upon what written protests said and what the public said during the public hearing.
Conat said property owners usually make the decision regarding the rate changes, not merchants occupying the building unless the water meter is in their name. However, it would be a good idea to send notices to both.
Fisher recommended to the board that the district continue with its normal policy of sending out notices.
"I would hate to set a precedence that we did it this way, and next time we did a rate increase overall, we would have to send everything out again," Fisher said.
Note: This story corrects an error in the Aug. 6 edition regarding the date of the public hearing. The meeting will be Sept. 18, not Sept. 21.