California is among the most progressive states
regarding cost-of-service requirements for water
rates. With the increasing need for water conservation,
and increasing popularity of water budget rate
structures, recent changes to California laws should
be of interest to water utility managers.
Water rates are regulated at the state level. The
evolution of these regulations in California created a
situation in which utility managers were not certain
if conservation-oriented rate structures would be
upheld in court. The recent passage of Assembly Bill
2882 has lifted this uncertainty and set a precedent
for other states. The growing popularity of water
budget rate structures may accelerate even more
now that they have been validated by California
lawmakers. Allocation-based inclining-block rates
were until recently infeasible because of the data
management and lack of political will. The tide has
changed in favor of such rates with the development
of new information management tools, the public
awareness of on-going water resource issues, and the
green light from lawmakers. Includes 3 references, figures.