Three Valleys MWD hits standby charge ceiling, explores legal avenues to bypass Prop 218 cap

Three Valleys MWD hits standby charge ceiling, explores legal avenues to bypass Prop 218 capFacing a mounting shortfall to cover the Metropolitan Water District's $10.3 million Readiness-to-Serve charge, the California wholesaler is investigating ways to amend a unique legislative exemption that capped its parcel assessments over two decades ago.

The TVMWD board approved a resolution to maintain its water standby charge at the statutory maximum of $29.41 per equivalent dwelling unit for FY 2026/27.

The assessment is expected to generate approximately $5.6 million, leaving a massive shortfall against MWD's $10.3 million Readiness-to-Serve charge.

Legal counsel confirmed TVMWD holds a rare, district-specific exemption to Proposition 218, but the board directed staff to explore judicial or legislative options to raise the assessment cap.

The Three Valleys Municipal Water District (TVMWD) board of directors voted on April 15 to initiate procedures to maintain its water standby charge at $29.41 per equivalent dwelling unit (EDU) for the 2026/2027 fiscal year. The charge, which is levied on property tax bills, is expected to generate approximately $5.6 million to help offset the Readiness-to-Serve (RTS) charge imposed by the Metropolitan Water District of Southern California (MWD). However, with MWD's RTS charge escalating to nearly $10.3 million for the upcoming fiscal year, TVMWD faces a structural revenue shortfall. The district is currently legally constrained from raising the standby charge above the $29.41 cap, forcing it to pass the remaining burden—estimated at $14.51 per EDU—directly to its retail member agencies. The hard cap stems from a unique, district-specific legislative exemption to Proposition 218 secured by TVMWD in the late 1990s and early 2000s. Legal counsel Steve Kennedy noted that TVMWD is the only agency in Southern California with this specific exemption, which allows the district to levy the assessment directly on property owners without a ballot measure, provided it does not exceed the historical cap. During the meeting, Director David De Jesus requested that staff and legal counsel investigate potential workarounds, including supplemental bills or new legislative avenues, to cover the rising costs without jeopardizing the existing exemption. 'I will say that these increases are not going to stop,' De Jesus noted, urging staff to explore options to manage future wholesale cost hikes. Kennedy agreed to monitor ongoing Proposition 218 case law for any openings that might allow the district to modify the legislation or proceed with new legislation. Director Jeff Hanlon and Director Bob Kuhn both expressed caution, emphasizing that the district must not risk invalidating its current exemption. The board also discussed how the escalating shortfall impacts retail member agencies differently. While agencies like Rowland Water District list the TVMWD shortfall as a direct pass-through on customer bills, the City of Pomona absorbs the additional expense into its volumetric rates for State Water Project supplies, which function as its highest-cost Tier 3 water.