Residents and businesses in Coronado will be paying more for the wastewater system as the city increases its fees for the first time since 2019.
Single-family homeowners in Coronado will see their sewage rates skyrocket by more than 50% over the next six years, and local restaurants will face fee increases of 35% under new wastewater rates adopted by the City Council on March 17.
We are overdue.City Manager Tina Friend
“We are overdue,” City Manager Tina Friend said of the rate increases. The last fee study was done in 2014.
City staff and a professional rate consultant, Raftelis, conducted a fee study over the last 18 months to figure out appropriate rate increases.
City Council members voted unanimously to approve the proposed increase of 8.5% per year starting fiscal year 2028 through 2031. All classes of users will see this increase. Fiscal year 2027 would serve as a “calibration year,” according to Denise Johnson, the city’s administrative manager for public services.
The calibration year, which will start next year, was calculated based on what exactly causes costs and bills for each customer class. They figured out the cost of service for each class and compared that to the revenue the city would have gotten at the current rates and adjusted the 2027 year accordingly.
The calibrated rates for fiscal year 2027 were proposed, with the majority of customers seeing an increase and a couple seeing a decrease.
Friend said that wastewater fees are collected from residents and businesses solely to cover costs of the operations.
Raftelis looked at the current rates and compared them to projected inflation and found that there was a funding gap. One of the key estimations was that there would be almost $16 million of inflation-adjusted capital expenditures for the fiscal years 2027-2031.
That means that over the next five years, they calculated the expenses for long-term assets such as manholes and pump stations, and adjusted those to account for rising prices.
There were other annual inflation assumptions made for general expenses, salaries and other criteria.
This financial plan … is not an excessive one. It’s basically designed to try to equalize our ending cash reserves at the end of our planning horizon with our target reserves.
Raftelis’ financial advisor John Wright
“This financial plan … is not an excessive one,” said John Wright, Raftelis’ financial advisor. “It’s basically designed to try to equalize our ending cash reserves at the end of our planning horizon with our target reserves.”
There are 18 customer classes that pay for the wastewater system, according to the city. That includes single and multi-family homes, hotels, schools, Navy bases, commercial and restaurants.
Currently, single family units pay just under $49 a month for wastewater services. By 2031, they will pay just under $77. Commercial businesses pay around $59 and will end up paying around $138 by 2031. Naval Air Station North Island pays $3,500 at the moment and will pay just over $7,000 by 2031.
Multi-family units and medium restaurants will see a slight decrease in 2027 due to the calibration year – and multi-family homes will actually continue to be less through 2031, with their current rates at $39 and their ending rates in 2031 being $37.
There will be a public hearing and introduction of the ordinance scheduled for May 5.
