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Page 9 of 11 <br />City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.org <br />Utility Rate Assistance Program <br />While the proposed rates are roughly in the middle of rates proposed by nearby agencies, rising City and <br />statewide utility rates may provide challenges to Redwood City residents who are low income. The City’s <br />Utility Rate Assistance Program (URAP) aids eligible water, sewer and solid waste customers through a <br />credit on their regular Redwood City utility bill. Eligibility is based on household income consistent with <br />San Mateo County 50% area median income limits. The current benefit for water customers is $25 per <br />month or $50 per bi-monthly bill. <br />Drought Rate Factors <br />During prolonged water shortages, customers are required to conserve or even ration their water use. <br />The magnitude of the water savings can significantly reduce water sales revenue from water use charges. <br />The Drought Rates calculated are equal to the rates that would have been produced through the cost-of- <br />service analysis, for a reduced volume of water. For each stage, the drought rates are calculated by lost <br />revenue from water sales net of any savings from reductions in demand-related costs (e.g. water <br />purchases). This analysis demonstrates that increases or decreases to water usage do not proportionately <br />reduce costs, as a large portion of the Enterprise’s costs are fixed. The expenses that do vary according to <br />usage have been accounted for in the calculation of the drought rates. The Drought Rate Factors in Table <br />5 are implemented only during periods of declared water shortage emergencies. Once a mandatory <br />shortage is declared, the City Council has discretion to enact Drought Rate Factors corresponding to the <br />level of shortage reduction being implemented. <br />Table 5 <br />Drought Surcharge Rates <br />  Demand Surcharge Rate (per HCF) <br />Stage Reduction 1/1/2026 1/1/2027 1/1/2028 <br />0 0% $0.00 $0.00 $0.00 <br />1 10% $0.38 $0.40 $0.42 <br />2 20% $0.85 $0.90 $0.95 <br />3 30% $1.45 $1.54 $1.62 <br />4 40% $2.25 $2.39 $2.51 <br />5 50% $3.38 $3.58 $3.76 <br />6 60% $5.07 $5.37 $5.64 <br />Next Steps <br />Following approval by City Council, Staff will follow the schedule outlined below to notify property owners <br />and rate payers of the proposed water rate changes. <br />1. Pursuant to Proposition 218, mail the Public Hearing Notice no later than August 11, 2025. <br />2. Property owners or ratepayers may submit an objection to the City Clerk through September <br />25, 2025 at 4:00 PM. <br />3. Before or during the Public Hearing respond in writing to any timely written objections. <br />6.F. - Page 9 of 111 <br />86