Some Raleigh residents could pay more for water

During the record drought that began in 2007 and stretched into last year, the City Council voted to implement a tiered rate structure for the municipal water system to encourage conservation. Because the city's billing software couldn't accommodate tiered rates, officials hired a consultant to study the best way of implementing variable pricing for water while it installed the needed software.

Council members on Tuesday reviewed the consultant's recommendations, and a preliminary rate structure was expected to be presented to the council on March 16 so they could begin setting policies and procedures to get the system in place.

Raleigh currently charges all water customers $3.89 per month, plus $1.96 for each 748-gallon unit consumed. Under guidelines recommended by Raftelis Financial Consultants Inc., the city would shift to a three-tiered system for residential customers and two tiers for non-residential customers.

The bottom residential tier would be for customers who use less than 3,000 gallons a month, while the second tier would be for those who use between 3,000 and 7,500 gallons. The top tier would include anyone using more than 7,500 gallons a month.

The City Council still needs to set the rates for each tier, but Raftelis said an approach in which the city doesn't collect a windfall from the transition would give people in the bottom tier an average 20 percent discount while charging those in the middle an average 40 percent more and residences in the top tier double the current $1.96 rate.

However, the average residential customer uses about 6,000 gallons a month and would pay about the same under the guidelines as he or she pays now.

Water used for irrigation and other outdoor uses would be charged at the top rate under the guidelines. All new homes are required to have a separate water meter for irrigation, but the Raftelis report doesn't address a cost or timeline for installing such meters on existing homes.

Rates for commercial water customers could be set between the first two residential tiers or could be created to target the largest water users and encourage conservation, according to the consultant.

Sewer charges wouldn't be affected by the tiered water system.

Cary, Durham and the Orange Water and Sewer Authority already have tiered water rates, and the Raftelis report shows the average Raleigh customer would continue pay the lowest water rates in the area under new tiered system.