Sewer Rate Increase

Following an extensive review and community process, the Salinas City Council has unanimously approved a sewer rate adjustment. This marks the first increase in over a decade—since 2012—when the monthly rate was set at $5.45 per Equivalent Dwelling Unit (EDU).

Why This Change is Essential

Over the past years, rising maintenance, operating costs, and extensive infrastructure needs have outpaced our available funding. Our sewer enterprise fund is currently projected to fall approximately $400,000 short in the fiscal year 2024–2025.
The Sanitary Sewer Master Plan Update conducted in May 2023 identified more than 280 miles of sewer mains, 11 lift stations, and numerous manholes that require urgent repair, replacement, and upgrades. Additionally, an incident in April 2022 culminated in a Notice of Violation and fines from the Regional Board due to untreated sewage discharge—highlighting the risks of underinvestment.

What's At Stake

If the current rate were maintained, we risk:

• Deferred maintenance, leading to system failures.
• Inability to meet state mandates and regulatory requirements.
• Defaulting on bond obligations, as current revenues fall below the necessary 125% debt service coverage threshold.

Details of the Rate Change

Starting July 1, 2025, the new monthly rate for a residential EDU will be $16.35, increased from the current $5.45. As required by Proposition 218, the increase covers only costs related to sewer services and is proportionally allocated by land use.
For the next four fiscal years, the rate will continue to rise modestly by 2% annually, reaching $17.70 per EDU by FY 2029–2030.

This increase supports:

• Operations & maintenance, including labor, materials, and utilities—estimated to rise annually by 7.5%.
• Critical capital improvements, including repairs, upsizing, and lift station upgrades.
• Debt service coverage and creation of a reserve fund for O&M and capital replacements.

Total high-priority improvements are estimated at $114.8 million over ten years, with a mix of pay-as-you-go and bond funding strategies designed to sustain long-term system reliability.

Enhanced Oversight & Community Engagement

Notices regarding the proposed rate increase have been mailed to property owners, with a public hearing held on June 17, 2025, allowing for protest proceedings in compliance with Proposition 218.

Town halls have already been held, and a protest vote mechanism is in place to ensure community voices are heard.

By FY 2029–2030, we commit to reviewing financial assumptions, operating costs, capital project timing, and demographics to assess if further adjustments are needed.

Moving Forward Together

We understand the impact on households, and recognize concerns raised by residents—especially those on fixed incomes or supporting ADUs KCBX. Yet, this measured, phased-in increase is crucial to:

• Keep the system safe and functional.
• Avoid costly emergency repairs and regulatory penalties.
• Build resilience for future growth and community needs.

We are committed to complete transparency, ongoing updates, and continued public engagement as this critical infrastructure project moves forward.

Thank you for your patience, trust, and partnership.