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Southern Nevada Water Authority

SNWA approves infrastructure charge increase

The Southern Nevada Water Authority (SNWA) Board of Directors approved an infrastructure surcharge to 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 options, 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.

Under the option selected, the charge is based upon the customer's meter size. Typical residential customers 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.

The three-year, monthly increase will take effect in April.

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 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 more than $188 million to as low as $3.2 million in 2010.

SNWA Infrastructure Charge Rates

The three-year infrastructure charge is based on your meter size. Most residential customers have a 5/8” or 3/4” meter. Find your meter size on your monthly bill directly above the water usage chart.

 
Approximate Monthly Charges per Meter
Meter Size Residential Non-Residential Fire Meters
5/8" & 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" N/A $1,659.59 $580.86

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, including a third intake currently under construction at Lake Mead.

Prior to seeking an increase, the SNWA reduced operational costs by $56 million, including a 25 percent reduction in its workforce, restructured existing debt and deferred more than $395 million in new construction and approximately $130 million in additional expenses.

Capital construction expenditures, associated debt service and fixed costs such as power represent the largest portion - 80 to 85 percent - of the SNWA budget. Staffing accounts for only 14 percent of expenses, a far lower portion than for most public agencies.

An independent consulting firm that conducted a rate study of SNWA revenues proposed the following options:

All of the proposals retain a formula that encourages conservation and lower-use consumption.

The Water Authority maintains one of the country’s largest and most-advanced water-treatment and distribution systems. Southern Nevada rate payers - even after any of the rate options would be adopted - will continue to have water rates well below the average of most Western cities.