NO.  TUD recently adopted a 5-year rate increase.  We do not anticipate they will need to further increase rates in the next five years; however, we can't predict the future. This is why we are proposing a "pass-through" provision for unanticipated wholesale water and sewer treatment costs.

The District purchases the majority of its untreated water supply from TUD – these costs are “wholesale water costs.” The District also pays TUD to treat its wastewater – these costs are “wholesale sewer treatment costs.” If TUD were to pass additional rate increases in the next five years (this is not expected), the District would be forced to pay the resulting increased wholesale water and sewer treatment costs.

To protect agencies like ours, the CA Constitution allows agencies to adopt a "pass-through" provision with their rates that allows them to pass-through any unanticipated wholesale water and sewer treatment cost increases they must pay during the 5-year period. This is only for wholesale water and sewer treatment costs. Since this rate increase already covers TUD's recent rate increases, this would only be needed if TUD passes additional rate increases in the next five years.

Should this unlikely scenario occur, the District will provide 30 days notice to its customers of the pass-through increase.