Beverly Hills City Council Postpones Water Rate Increase

The Beverly Hills City Council last night rejected a water rate increase presented by the city’s Public Works staff that would have had a major impact on residents of West Hollywood’s Westside.

But a rate increase is not off the table. The council asked the staff to make a number of changes in the proposed increase including devising a different rate structure. It also raised concerns about how water charges would be allocated among residents of multi-unit buildings where individual condos or apartment don’t have their own water meters.

The Beverly Hills Drinking Water Enterprise (BHDWE) supplies water to West Hollywood residents and businesses in an area whose approximate boundaries are Doheny Drive on the west, Sunset Boulevard on the north, Flores Street on the east and Beverly Boulevard on the south. The rest of West Hollywood is served by the L.A. Department of Water and Power (DWP).

The proposal considered by the council would have boosted the overall average rates for single-family residential customers in WeHo by 22%. The exact increases would vary according to which of four tiers of water usage a homeowner fell into. Apartment and condo building owners would have seen their rates increase 52% on average. Businesses would have faced an average rate increase of 24.6%. The size of those increases reflects the fact that the BHDWE charges its West Hollywood customers 25% more than its Beverly Hills customers.

That rate differential is one of several aspects of the proposed increase that WeHo City Councilmember Lauren Meister objected to in an appearance before the Beverly Hills Council last night. Meister also objected to the fact that the BHDWE has never included its West Hollywood customers in community meetings held to discuss proposed rate increases. “There is such disrespect for West Hollywood customers,” she said. Meister asked that the City of Beverly Hills have a community meeting with its West Hollywood customers before moving forward on another proposal for a rate increase and an increase in penalties levied on those who use more water than they should.

The BHDWE said the 25% surcharge that it levies on its WeHo customers is “in recognition that Beverly Hills has extended service out of the city limits to customers that had not contributed to the City’s General Fund which funded the initial construction of the City’s water system.” Beverly Hills established its own water utility in 1928 when it purchased the Sherman Water Company.

But Meister said that if the surcharge is intended to compensate Beverly Hills for early investments in the water system that WeHo didn’t help pay for, now it is time to calculate whether WeHo’s payments have covered that gap. Meister said she also wants to know if the surcharge is “revenue neutral.” The BHDWE has said its fees are designed only to cover its costs and not generate profits.

Meister said there is a disparity in the fact that WeHo’s Westside is served by BHDWE and the rest of the city by the L.A. Department of Water and Power. In response to the California’s serious drought, the state has mandated that Los Angeles and those served by the LA DWP reduce their water usage by 16% or pay a penalty. Those served by the BHDWE will have to reduce their usage by 30% to avoid a penalty.

“There is something that is not equitable here,” she said. “You can’t say to the Westside that you have to conserve 30% or there’s a penalty while in the Center City and on the Eastside there isn’t that big a requirement.”

The population of Beverly Hills and West Hollywood is roughly equal, with each city having just over 34,000 residents according to the 2010 U.S. Census. But Beverly Hills is three times larger than West Hollywood, which covers only 1.89 square miles.