LTC 049-2008 Water Consumptionm ~IAMIBEACH
OFFICE OF THE CITY MANAGER
NO. LTC # 049-2008 LETTER TO COMMISSION
TO: Mayor Matti H. Bower and Members of the City Commission
FROM: Jorge M. Gonzalez, City Manager
PATE: February 5, 2008
SuB~ECT: Water Consumption
This Letter to the Commission (LTC) is to provide information about the City of Miami Beach water
consumption for the first quarter of FY2007/08. On September 26, 2007, at the second Public
Budget Hearing, the City Commission approved an increase in water and sewer fees based on an
assumption that the decrease of water consumption in FY07/08 would be 10% below FY2006/07.
The Manager's proposed budget for FY2007/08 initially included higher rate increases based on an
18% decrease in consumption. At that time, estimates for water consumption ranged from 10-18%
in recent months. W ith the final adopted budget, the 10% decrease in water consumption was used
as a conservative measure in order not to raise rates higher than necessary, with the full
understanding that the Commission might be asked to fund rate increases later in the year. As the
Commission may recall, there is an inverse relationship in the water system that a decrease in use
actually prompts an increase in rates. Thus, the use of a lower decrease in consumption allowed a
smaller rate increase.
The hurricane season ended November 30, with less than normal hurricane activity and rain events,
providing no relief from the continuation of the prolonged drought that has persisted throughout
South Florida and the state. As a result, on January 15, the South Florida Water Management
District (SFWMD) declared an `extreme District-wide water shortage' and instituted the Modified
Level 3 water restrictions to address the shortage. Unlike the Phase II restrictions, the new plan now
reduces residential landscapes to cone-day-a-week (previously twice perweek) irrigation schedule,
as well as reducing golf course irrigation use by 45 percent. The District estimates that landscape
irrigation accounts for up to half of all household water consumption in Florida.
While the total water purchased from Miami-Dade County for all of FY2006/07 showed only a minor
decrease, it is important to note that consumption for the last six (6) months of FY2006/07 resulted
in a net decrease of 14% from FY2005/06. Further, as reflected below, total water consumption
(in gallons) for the first quarter of FY2007/08 was 19% less than the first quarter of FY2006/07.
October November December Y-T-D
FY2007/08 Actual
FY2007/08 Budget
FY2006/07 Actual
FY2007/08 Decrease from FY2007/08
Budget
FY2007/08 Decrease from FY2006/07
Actual
615,352,592 556,200,176 570,018,704 1,741,571,472
665,453,570 659,856,589 611,140,111 1,936,450,271
739,392,856 733,173,988 679,044,568 2,151,611,412
8% 16% 7% 10%
17% 24% 16% 19%
With the imposition of Modified Level 3 water use restrictions, a continued decrease in the amount
of water consumption will also result in a concurrent significant decrease in sewer revenues.
LTC
February 4, 2008
Water Consumption
Page 2 of 2
We will continue to closely monitor the water consumption and sewer treatment volumes over the
upcoming months.
Based on the first quarter trends, and due to the even more restrictive water consumption measures
imposed by the SFW MD, we anticipate the water and sewer fees will have to be increased mid-year
in order to prevent losses in Water and Sewer utility fund, which are already low in their fund
balances. However, we will continue to monitor the next couple of months prior to making any
specific recommendations.
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