District approves historic water-rate increases
Last Updated: 17:14 July 11, 2014
Customers of the Northern Colorado Water Conservancy District receive water units under two types of contracts: open rate and fixed. By 2018, the open-rate assessment for a unit of water from the Colorado-Big Thompson Project will cost $30.20 for agricultural users, up from $10 this year, and $53.10, up from $28, for municipal users.
Fixed-rate assessments based on decades-old contracts will remain $1.50 per acre foot.
Board members unanimously approved a steep rate hike for the open-rate assessments, though Colorado-Big Thompson Project water users had requested a smoother transition of increases over time. The rate hike through 2018 represented the largest dollar increase in the public water district's 77-year history, though the water district's board members has passed similar percentage increases in the past.
The steeper rate hikes will help Northern Water more quickly achieve a balanced budget, said Jerry Gibbens, project manager and water resources engineer for Northern Water. The water district's expenses have outpaced its revenue in three of the last four years, but Northern Water expects to reach a balanced budget by fiscal 2017 through the rate hikes.
Based on decades-old contracts, the fixed-rate assessments remained the same, a point of contention among some water users who pay the higher open-rate assessments and contend that Northern Water should raise the fixed-rate assessments.
Northern Water's board agreed to look into how it could adjust the fixed rates in the future, but the agency has indicated that it may not be able to do so because they are set "contractually in-perpetuity."
In June, the board decided to raise 2015 open-rate assessments to $30.50 per unit while the agricultural rate will rise to $10.90 per unit.
Under current projections, rates for Colorado-Big Thompson Project water could increase to more than $100 per unit for municipal users and to $80 per unit for agricultural users by 2023, according to Northern Water documents.
Board members did not decide on increases after 2018, but they plan to set rates annually as well as make projections of rate adjustments two fiscal years in advance.
Northern Water, formed in 1937, manages the Colorado-Big Thompson Project, which diverts water from the Colorado River Basin to the South Platte River Basin through a system of reservoirs and tunnels.
The agency delivers an average of 215,000 acre feet of water annually for municipal, agricultural and industrial uses in Boulder, Broomfield, Larimer, Weld and four other Colorado counties. It provides service to 860,000 people on the Northern Front Range.
Click here to read more about the rate hikes.
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