Water Rate Adjustment

Rate Study

The City of Morgan Hill (“City”) retained NBS Government Finance Group (“NBS”) in May 2021 to conduct an updated comprehensive water rate study for a number of reasons, including meeting long-term revenue requirements, ensuring revenue stability in water rates, providing adequate funding for capital improvements, and ensuring rates comply with applicable laws, including Proposition 218. The rates developed in this study meet Proposition 218 (Prop 218) requirements and were developed based on industry standards.

Resources

2022 Water Rate Study (PDF)

Booster Station Zones (PDF)

Prop 218 Notice (PDF)

Process

The City conducts a thorough and transparent public process prior to implementing any rate adjustments. The rate study and the financial analysis has been prepared by the independent financial consultant (NBS) to determine true costs of service and what rate adjustments are needed. Below is the tentative schedule for the process.

March 11, 2022 – Water Rate Study released. (Completed)

March 24, 2022 – Community meeting to introduce Water Rate Study. (Completed)

April 6, 2022 - The rate study is introduced at the City Council meeting and general policy direction is provided. (Completed) 

April 7, 2022 - Staff will initiate Proposition 218 noticing during this week and commence the 45-day protest period. (Completed)

June 1, 2022 - Public Hearing - City Council will review Proposition 218 protests, conduct public hearing, and consider adoption of rates. (Completed)

July 1, 2022 - New rates go into effect for consumption beginning July 1, 2022 (August 16, 2022 billing date). (Completed)