CHANGES IN WATER RATES AND WATER CONSUMPTIONIN TUCSON, 1974 TO 1978
byAdrian H. Griffin
James C. WadeWilliam E. Martin
University of Arizona

In July 1976, the City of Tucson Water Department, facing serious problems in the financing andoperation of their water system, introduced an innovative water rate structure. First, the basic
water rates were a departure from previous practice in that the cost of a unit of water to a customer
would rise very markedly as his monthly consumption increased. Second, customers living in the higher
parts of the City would be charged lift charges in order to recover the additional cost of delivering
water to the higher areas of the City.
Finally, new customers would be required to pay a System
Development Charge in order to recover the cost of developing and enlarging the City's water system.
The new water rates proved to be very unpopular and the councilmen who had voted for them were recalledfrom office.
As a result of the rate increases and the furor spawned by the recall campaign, water
consumption in Tucson fell markedly after the summer of 1976.
This paper describes the changes inwater rates made from 1976 and 1978 and the resulting changes in water consumption in Tucson.

CHANGES IN WATER RATES

Until June 1976, the City of Tucson Water Department had a fairly conventional rate structure.
Customers were charged a monthly connection fee which covered the first 6 ccf (hundred cubic feet) usedeach month.
The next 14 ccf used each month were charged at a rate which depended on whether the customer was within the city limits or not -- customers within the cities of Tucson and South Tucson paid
304 /ccf while those outside the two city limits paid 524 /ccf; customers in some isolated areas in thefoothills of the Catalina and Tucson Mountains were charged a "Special" rate of 484 /ccf. Consumption
in excess of 20 ccf was charged for a slightly higher rate:
customers within the two cities paid
394 /ccf, those outside the cities paid 56t/ccf, and customers charged at the Special rate paid 624 /ccf.
In January 1976, the City's consultants, John Carollo Engineers, recommended a program ofimprovements to the city's water distribution system.
These improvements were to be financed by bothissuing bonds and raising water rates. Most of the improvements were made necessary by the growth of
the City and the need to meet the very high peak demand for water occurring on summer afternoons
resulting from the extensive use of water for lawn sprinkling.
The City Water Department had decided
that the cost of providing for the afternoon peaks should fall upon customers who increased their consumption on summer afternoons; presuming that high consumption indicated strongly - peaked consumption,
they had instructed Carollo to devise a rate structure in which the price of water paid by a customer
would increase with his consumption.
In this way, the cost of providing for the peak demand would berecovered from customers using large amounts of water.
In July 1976, the City introduced a new rate structure based on Carollo's recommendations. The
price of each ccf of water rose from 354 to 754 as a customer's monthly consumption increased from 6ccf to 100 ccf.
Rates were set by class of customers, rather than by size of service, with different
price schedules for each class of customer. The price schedule for Single -Family Residences is shownin Figure 1; the other classes of customers -- Duplex -Triplex Residences, Multiple -Family Residences,
and Commercial Users --faced similar rate schedules, although the price of a unit of water did not riseas much as it did for Single -Family Residences.
The second feature of the new water rates was the lift charges. The Water Department divided its
service area into a number of "Lift Zones ", and customers living in the higher areas were charged extra
for water.
About half of the city's 97,000 customers lived in the base service area where no liftcharges were payable.
The 28,000 customers living in the first lift zone were charged 204 extra foreach ccf, and the 16,000 customers in the second lift zone area were charged 404 /ccf extra; a further
8,000 customers in the third lift zone were charged 604 /ccf extra, and about 1,500 customers- -those in
the fourth to eighth lift zones --paid surcharges ranging up to 51.60/ccf. Customers in parts of lift
zones where the Water Department had wells were charged the extra lift charges only for water used inexcess of that produced by their local wells.
For example, each of the 21,700 customers in pressure
35subzones 1C and 2C of the first lift zone could use 15.8 ccf each month before lift charges became
payable; similarly, the 13,400 customers in pressure subzones 10, 5D, and 7D of the second lift zone
were charged lift charges only for use in excess of 21.3 ccf /month and the 7,500 customers in subzones
lE and 6E of the third lift zone paid lift charges only for consumption in excess of 16.2 ccf /month. A
further 2,500 customers in various lift zones were allowed various amounts of water (ranging between
two and twenty ccf each month) before lift charges were added to the cost of each ccf of water used.
The third novel feature of the new water rates was the System Development Charges. New customers
would be required to contribute toward the development of the Water Department's distribution system
and well fields in addition to paying for the new mains connection. The System Development Charges
ranged from $750 for a 3/4 -inch connection to $126,875 for a twelve -inch connection.
The introduction of the new water rates in July 1976 increased Tucsonans' water bills substantially.
Table 1 gives a comparison of water bills for single- family residences under the old and new rateschedules at various levels of consumption. The sample water bills in the Table show quite clearly thatthe size of a customer's monthly bill would vary greatly depending upon the lift zone in which he wasresident and upon the allowance given for water pumped from wells within his pressure subzone. Table 2shows the variation of water consumption among the Water Department's Single -Family Residence customers
The pattern of consumption in June 1976 was similar to that in July. The figures infor the month.
Tables 1 and 2 clearly show that many Tucsonans experienced a substantial jump in their water bills
between June and July of 1976.
Tucsonans were shocked by the sudden increase in their water bills. The Council and the Water
Department received many complaints from the public during July; near the end of that month, theSouthern Arizona Homebuilders' Association began legal proceedings against the Council, asking theIn the early days of August there began a campaign
County Court to strike down the new water rates.
to recall from office those councilmen who had voted for the new water rates. The Council responded
by dropping the lift charges and suggesting a referendum on water rates. Later, the Council organizeda series of "Water Workshops" in an attempt to educate the public on the region's water problems. In
September, the Water Department hired Black & Veach to repeat Carollo's study and hired MR West
Marketing Research to study consumers' awareness of the local water problems and attitudes towardvarious means of solving them. The Citizens' Advisory Water Committee was established to look intoBut the recall campaign continued: thethe matter of water rates and water resources generally.
petition to recall the four councilmen who had voted for the new water rates was filed on September 14
and the recall election was announced for January 18, 1977.
In the recall election the councilmen who had voted for the new water rates were soundly defeated.
The new council took no action on water rates until the Citizens' Advisory Water Committee completed
The Council made a number of modifications on the Advisory Committee's
its report on February 1977.
recommendations and, in March, passed an ordinance bringing new water rates into effect on April 1,1977. A novel feature of the new water rates was that different rates would be applied in the winterAll classes of customers would be charged a uniform price for all water consumed inand the summer.
During the summer, single -family residences, duthe six winter months between November and April.
plexes and triplexes, and multiple- family residences and commercial customers using less thatn 100
ccf /month would be charged according to a schedule of increasing block rates. The new rate schedule
faced by single -family residences- -which was higher than the 1976 rate schedule --is shown in Figure 1.
Larger multiple -family residences and commercial customers would pay a surcharge on consumption in theThe lift charges and thesummer which exceeded their average consumption in the six winter months.
system development charges were not reintroduced.
The City began the first "Beat- the -Peak" campaign in the summer of 1977. The objective of thecampaign was not to conserve water, but to reduce the very high peak demands occurring on summer afterTucsonans were encouraged to refrain from watering their lawns between four and eight in thenoons.
afternoon and to water on alternate days, depending on which side of the street they lived. But eventhough the campaign was principally aimed at flattening the peak, the information disseminated isbound to have had some effect upon Tucsonans' total water consumption.

In 1978, the Council raised water rates by about 8% while maintaining the same general rate
structure as adopted in 1977. There was virtually no adverse public reaction to this rate increase.
In, April 1979, water rates were raised by about 6% and increasing block rates for the winter were introduced; residential customers now faced a block rate schedule all year round, although the rate scheIn April 1980, water rates were raised again while maindules are different in summer and winter.
All of the rate schedules faced
taining the same rate structure as adopted in the 1979 rate increase.
by single -family residences between 1974 and 1980 are shown in Figure 1, where the marked changes inwater rates over these years can be seen quite clearly.

CHANGES IN WATER CONSUMPTION
Water consumption in Tucson fell markedly after the water rate increases of July 1976. Up until
the fiscal year 1975/76, the City Water Department's pumpage per capita averaged about 185 gal /day.
the Water Department's pumpage was only 150
But in 1976 and 1977, water consumption began to fall:
36

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1977 S80 -1979 W
1976- - r.z.r,r1977 Wr-40 -

1978 Wr-'1974

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20

30

40

50

Monthly

Consumption

Iccfl

NOTE: The year of introduction is shown alongsideeach rate schedule. S and W denote summerand winter rates.

gal /head day in the fiscal year 1976/77, was 142 gal /head day in 1977/78, and fell to 140 gal /head day
The use of water during the summer fell more than the average year -roundin fiscal year 1978/79.
A number of quantities showing the change in the seasonal variation in water use overconsumption.
The Table shows that total metered
the five calendar years from 1974 to 1978 are shown in Table 3.
The year -round average of metereddeliveries in the month of June fell by 29% between 1974 and 1978.
deliveries to single -family residences fell by 30% between 1974 and 1978, but deliveries in the monthof June fell by 36% over these four years.

The total amount of water delivered each year was broken down into water used indoors for generalsanitary purposes and water used outdoors for sprinkling and cooling by presuming that all of the water
delivered during the January, February, and December of each year was used indoors, and that indoor use
remained at this level throughout the year. The amount of water used outdoors in the nine months fromMarch to November was taken to be the difference between actual metered deliveries in these months andThe figures in Table 3 show that outdoor
the average metered deliveries in the three winter months.
use per service by all customers decreased by 32% between 1974 and 1978, while indoor use fell by only
Over the same period of time, outdoor use per service by single -family residences fell by 40%
15 %.
The ratios of indoor use to outdoor use
and indoor use by single -family residences fell by only 24 %.
show that in 1974, 35% of the water delivered by the Water Department was used outdoors and that thisproportion fell to 30% in 1978.

CONCLUSION

The pattern of water consumption in Tucson has changed markedly since the water rate increases
Overall, water consumption per capita has fallen by about 20% since 1974, although the amountof water used outdoors for sprinkling and cooling, particularly that by single -family residences, has
fallen by a much greater amount. The exact causes of this change in water consumption are uncertain,
38of 1976.

Table 3 -- Changes in the Seasonal Variation in Water Consumption in Tucson, 1974 to 1978I-- All Customers
Ratio

Use - ccf

Metered Deliveries- -ccf /monthTotal

1974
1975
1976
1977
1978

Delivered

Average

AverageYear -roundJan /Feb /Dec

June(ccf)

Indoors

Outdoors

26.4

17.0
17.7
17.7
15.0
14.5

42.3
37.7
32.4
27.2

317
314
286
249

204
212
212
180

113

30.1

251

174

26.1

23.8
20.7
20.9

101

74
69
77

65:35
68:32
75:25
73:27
70:30

II -- Single -Family Residences
Ratio

Use - ccf

Metered Deliveries -- ccf /month
Total

1974
1975
1976
1977
1978

Delivered

Average

AverageYear -roundJan /Feb /Dec

June(ccf)

Indoors

Outdoors

20.0
18.5

12.4
11.8
11.5
9.9
9.4

33.6
28.2

240222
193
168
168

149

91

141

80
55
49
55

16.1

14.0
14.0

23.1
19.1

21.5

138
119
113

63:37
64:36
72:28
71:29
67:33

All of the figures in this Table are based on the City Water Department's records of water consumption
by class of customer for the sixty months from January 1974 to December 1978.
Total outdoor use in each year is the January /February /December average metered deliveries times
twelve months.

Total indoor use in each year is the sum over the nine months from March to November of the difference
between actual metered deliveries in that month and the January /February /December average for the year.

but are bound to include the increases in water rates, the continuing news of Tucson's water problem,
and the Beat - the -Peak campaign. The Beat - the -Peak campaign was principally aimed at flattening thepeak, not reducing total water consumption, but it has created an awareness of a water problem inTucson and has apparently contributed to the fall in water consumption. In any case, continually
increasing water rates are now accepted by the public in Tucson.

ACKNOWLEDGEMENTS

The authors are grateful to the planning staff of the City of Tucson Water Department forproviding the data used in this study. The work upon which this report is based was supported in partby funds provided by the U.S. Department of the Interior, Office of Water Research and Technology underArizona
Project Grant No. A- 087 -ARIZ, and in part by funds provided by Resources for the Future.
Agricultural Experiment Station Journal Article No. 3326.

39