Why don’t we know exactly what rates will be if we own the water system?

A:

We don’t know how much more than the appraised value of $55 million the cost will be as the exact purchase price has not yet been determined. Rates should only increase if we need more than $80 million in revenue bonds. However, changes in the actual cost of the water we need to buy, repairs, and suchlike could also have an affect on the rates. These would apply to GSW as well as to us, of course, and we would not have to adjust rates to maintain a fixed profit margin since it is illegal for the City to make a profit.  See the question “Won’t  our water bills go up if we own the system?” for an indication of possible rate increases at $120 million.