Budget & Finance

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Budget & Finance.

To keep our vast water delivery system running smoothly and invest to meet Southern California’s water demands for generations to come, Metropolitan maintains an annual operating budget of nearly $2 billion. We make forward-thinking investments  in supplies, in storage, in conservation and in treatment and we responsibly maintain our existing infrastructure. These strategically important programs together provide Metropolitan operational flexibility to store water when it is available and provide it to our communities in dry years. Our water rates are established to recover the cost of providing this water service in an open and transparent public process as part of the biennial budget.

Metropolitan’s strategic investments in a diverse portfolio of water supplies and storage have helped ensure the region has a reliable water supply amid California’s highly variable annual precipitation and snowpack. 

Investing in Southern California  

Our most recent $3.9 billion biennial budget (Fiscal Year 2020/21 and FY 2021/22), includes capital spending about $500 million, largely to rehabilitate existing facilities so they are well-maintained and seismically-sound. More than half of these projects are funded from operating revenues, rather than debt financed.

Among some of Metropolitan’s largest strategic investments in recent years:  

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Regional Recycled Water Program

In partnership with the Los Angeles County Sanitation Districts, a demonstration facility in Carson has been built to test new treatment methods to purify wastewater. The facility could pave the way for one of the nation’s largest water recycling facilities.

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Conservation & Local Resources

Metropolitan has invested $1.5 billion in water conservation, recycled water and groundwater recovery since 1990.

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Storage

Metropolitan has developed more than 5.5 million acre-feet of storage capacity – a 13 times increase in capacity since 1990. 

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Succession Planning

Metropolitan has an ongoing, dynamic effort to ensure the strongest possible future for Metropolitan by tapping the best talent, training employees, and developing leaders for the future.

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Responsibly Managing Our Finances 

Metropolitan has a long history of responsible fiscal management and maintains some of the nation’s highest credit ratings among government agencies 

  • S&P: AAA 
  • Fitch: AA+ 
  • Moody’s: Aa1 
Effective January 1st 2020 2021 2022
Tier 1 Supply ($/AF) $208 $243 $243
Tier 2 Supply ($/AF) $295 $285 $285
System Access Rate ($/AF) $346 $373 $389
Water Stewardship Rate ($/AF) $65 - -

System Power Rate ($/AF)

$136 $161 $167
Full Service Untreated Volumic Cost ($/AF)      

Tier 1

$755 $777 $799
Tier 2 $842 $819 $841
Treatment Surcharge ($/AF) $323 $327 $344
Full Service Treated Volumic Cost ($/AF)      

Tier 1 

$1,078 $1,104 $1,143
Tier 2 $1,165 $1,146 $1,185
Readiness-to-Serve Charge ($M) $136 $130 $140
Capacity Charge ($/cfs) $8,800 $10,700 $12,200

 

Definitions

  • Tier 1 Supply Rate – recovers the cost of developing and maintaining a reliable water supply
  • Tier 2 Supply Rate – set at Metropolitan's cost of purchasing water transfers north of the Delta, this rate tier encourages the maintenance of existing local supplies and the development of cost-effective local supply resources and conservation
  • System Access Rate – recovers costs associated with the interconnected regional delivery network necessary to deliver water to meet member agencies' average annual demands. Included are the costs of conveyance and distribution facilities
  • System Power Rate – recovers Metropolitan's power costs for pumping supplies to Southern California
  • Water Stewardship Rate – recovers the costs of providing financial incentives for existing and future investments in local resources, including conservation, recycled water and groundwater recovery
  • Treatment Surcharge – recovers the costs of treating imported water
  • Readiness-to-Serve Charge - a fixed charge that recovers the costs of providing emergency service and available capacity to meet outages, emergencies and hydrologic variability
  • Capacity Charge – recovers the cost of providing peaking capacity within the distribution system which Metropolitan owns or has the right to use

Metropolitan also receives a small percentage of revenue from property taxes. Learn more. 

Contacts

The Office of the Chief Financial Officer

Katano Kasaine 
Assistant General Manager/Chief Financial Officer
(213) 217-7121 

Treasury & Debt Management

Samuel L. Smalls
Manager of Treasury & Debt Management
(213) 217-7863

Budget
Controller
Revenue & Budget

Note: All information contained in the Financial Information pages is obtained from sources believed to be accurate and reliable. While all information presented is believed to be accurate and reliable, it is prepared without audit unless otherwise identified as audited financial information. Due to the possibility of human or mechanical error and other factors, this information is provided as is without warranty of any kind and MWD makes no representation, express or implied, as to the accuracy, reliability, completeness or timeliness of this information, and is not responsible for any loss or damage incurred by any party using this information. The information contained at this website has been included for general informational purposes only and no person should make any investment decision in reliance upon the information contained herein. This website and the information contained herein do not constitute an offer to sell or the solicitation of an offer to buy any securities.

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