Rollingwood citizens will be seeing changes to their July water bills as City Council voted unanimously May 16 to adopt a new rate structure that emphasizes water conservation.

The newly adopted rate structure, which replaces the structure adopted Feb. 7, adds more tiers and considerably higher water rates for any amount of water usage greater than 75,000 gallons. The adopted proposal was the 10th different proposal made by the city's utility rate consultant, Grady Reed of HDR Inc.

The newly adopted rate change differs from the February rates in a few key ways. The new rate will raise the Water Demand Charge from $11.90 to $14.87, but will keep the first 2,000 gallons of water free of charge.

The first two tiers of the new rate will have slightly higher costs, with a $0.46 increase per 1,000 gallons in the 2,001–10,000 gallon usage range and a $0.41 increase per 1,000 gallons in the 10,001–20,000 gallon usage range.

The increases on the lower tiers help the city negate the cost of water, which is currently purchased from the City of Austin at $4.13 per 1,000 gallons. At the previous price, the city was losing money on the lower tiers.

With increases on the lower tiers, the citizens of Rollingwood will actually see savings on the middle tiers. With the February rates, citizens paid $7.30 and $11 for 20,001–35,000 gallons and 35,001–50,000 gallons respectively. These rates are decreased to $5.38 and $7.92 respectively.

The largest changes were made to the highest tiers, adding two more levels to the newly adopted rates. Previously, usage greater than 50,000 gallons was rated at $14.70 per 1,000 gallons, but the new rates charge $10.95 for 50,001–75,000 gallons, $14.95 for 75,001–100,000 gallons and $20 for usage greater than 100,000 gallons.

The highest two rates were lower in the original proposal, but Alderwoman Sara Hutson proposed that the rates, although higher, would encourage residents to conserve water.

"That way the rates increase at each tier, and it's more symmetrical," Hutson said. "The information that we have here on the number of customers that use each tier of water in August of last year, the bottom three tiers, from 0–20,000 gallons, there were 155 residential accounts. The top two tiers, so 75,000 gallons and up, there were only 29 users total, but when you go down below that and look at the volume of water consumed by those two groups, the top group of 29 customers, so 20 percent of our customers, used 1 million more gallons in one month. So, 20 percent of the people used 1 million gallons more water. For a limited resource, they are using more than their fair share."

"All this does is increases revenue to the city," Reed said. "You don't see a lot of conservation with water rates until it becomes punitive, so the higher you make each tier, the more water conservation you will see."

The new rate structure will operate on the same principle as the previous one, on the block system. If a customer were to use 12,000 gallons in a month, the first 2,000 would be included in the Water Demand Charge while the next 8,000 would be billed out at $4.13 per 1,000 gallons and the last 2,000 gallons at $4.53.

"The amount of water used within that block is charged the rate of that block," Mayor Bill Hamilton said. "When it moves into that next block, only the water that's used within that block is charged that rate."

Rollingwood citizens will have one month to prepare for the rate changes, which will be implemented June 23 and will be reflected in July water bills.