Recycled Water Controversy: Are Customers Being Overcharged?

The city of Newport Beach in California will repay $433,000 to four customers after overcharging them for recycled water.

“Two country clubs, a school district and a church that said they were overcharged for recycled water will receive more than $433,000 in refunds from Newport Beach under settlement agreements approved by the City Council,” the Los Angeles Times reported.

“The city will pay $222,770 to Big Canyon Country Club. Newport Beach Country Club will receive $190,179 and Our Lady Queen of Angels Catholic Church will be reimbursed $7,769. Newport-Mesa Unified School District, which has its main office in Costa Mesa but operates schools in Newport Beach, will receive $12,395 for recycled water use at Eastbluff Elementary School,” the report said.

The refunds are expected sometime in November. Recycled wastewater used by these customers was used for outdoor watering.

The price of Newport Beach recycled water has been under scrutiny for years. “Executives with the country club requested in July 2011 that the city conduct an analysis of the cost to provide and transport recycled water to the business. The analysis by Irvine-based HF&H Consultants took about three years and resulted in the city reducing the price of recycled water to the club by about 50 percent,” the Los Angeles Times previously reported.

The city then lowered the price for all recycled water users, according to George Murdoch, the city's general manager for utilities, per the article.

“To calculate the amounts the four customers will receive under the agreements, the city subtracted the water use and fixed rates established in an analysis of the water rate study from the amount paid for water use and fixed charges from the middle of March 2013 to the end of October 2014,” the report said.

The customers have claimed that Proposition 218, passed in 1996, makes it out-of-bounds for the city to hike up recycled water prices. “The city is restricted from charging more for goods and services it provides than what those goods and services cost," the report said.

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