By PAUL LITTLE

There is no doubt Southern California is faced with a dwindling supply of water. As a result, local water companies are taking actions to stabilize finances while providing less of the commodity.

In Pasadena, our Water and Power Department is proposing significant increases to the cost of water to stabilize its financial position. The increases would add 10 percent to 30 percent to most commercial customers’ bills and 10 percent to 20 percent to residential bills. Another increase will be imposed July 1, 2010.

Understandably, this proposal has created unease among many in the business community in Pasadena.

For one thing, these increases are coming in the midst of a very severe economic downturn that has many businesses taking dramatic steps to maintain operations. Many businesses as well as residents have had to make difficult decisions to maintain their financial viability. A dramatic increase in water costs may have far-reaching negative impacts on our local economy.

For another, the department’s proposal is an all-or-nothing proposition. At this time, there is no consideration given to anything but maintaining the water department’s bottom line. As Water and Power General Manager Phyllis Currie told our City Council, the proposal is intended to stabilize the department’s finances by increasing the price of the commodity and adjusting pricing tiers to lower water use levels.

The Pasadena Chamber of Commerce is recommending instead that any increases be phased in over at least four years so that the economy has time to rebound before the full impact of substantial increases in water costs hit our businesses.

Alternatively, the chamber would recommend lowering the percentage increase or maintaining the current billing categories and reserving high pricing tiers for those who are demonstrated to be wasting water, not just using large amounts in their normal course of business.

Issue of fairness

Is it fair, for example, that a hospital that has lowered its water consumption by implementing conservation measures yet still must use a significant amount of water for its normal operations be charged at the same rate as a resident who waters his lawn daily during the afternoon and refill his swimming pool weekly? The hospital is required to wash bedding at least daily, maintain very high levels of cleanliness and provide for patient comfort. The other is clearly wasting the resource and should pay a higher rate.

Also, increases could be offset by departmental efficiencies. The general impression is that government is wasteful and ultraprotective of its bureaucracy. I served on the Pasadena City Council for 12 years and I know the vast majority of municipal employees are hard working and dedicated. That said, our water department is seeking an increase to maintain its budget at present levels without instituting savings to offset the cost increases. Costs could be reduced further or perhaps costs in other departments could be cut to help mitigate the increased cost of water.

Finally, Pasadena’s commercial water customers are paying a disproportionate amount of the proposed increases, especially when departmental reports indicate residential customers waste water at a disproportionately high level.

Most, if not all, commercial customers have implemented conservation measures and may already have reached the department’s targeted 10 percent reduction level. Commercial customers are unable to recoup additional costs associated with this significant increase, so they likely will have to reduce costs in other areas. This could mean work force reductions, temporary or permanent closures, curtailment of services or restriction in operating hours. Those measures could impact our community in lost jobs, lost opportunities to do business and decreased revenues to the city.

It seems logical, if water conservation is a goal, that significant increases should target those who are wasting water, whether commercial or residential. Increases then should be adjusted so that those customers who are wasting water are responsible for paying the costs in the highest rate tiers, not simply the largest users of water. Just because a customer uses a large amount of water does not mean they waste the resource.

Likewise, those customers who have reduced their water usage by the requested 10 percent from 2006 levels should be rewarded with exemption from charges in the highest ranges. Those costs could be shifted to those customers who are shown to be wasting water away from the hospital, golf course, university or laundry that must consume water to operate.

The bottom line is that the current state of the economy, and the impacts being felt by important businesses in Pasadena, as well as our residential community, requires that a thorough and comprehensive public evaluation of the proposed increases be undertaken before these hikes are implemented. That review should take into account potential consequences to the local employment base and economy, as well as the water department and city finances.

Likewise, significant weight should be given to the impact these increases may have on some of the cornerstone institutions and businesses in our community as well as our employment and revenue base.

Paul Little is the president and chief executive of the Pasadena Chamber of Commerce.