Electric service rates could increase next year, after a review of Turlock Irrigation District's preliminary budget for the 2015 financial year. The possibility of a five percent increase in rates, which will be used to address a forecasted revenue shortfall of $16.7 million, will be the focus of a public hearing scheduled for Dec. 2.

"I support going forward and setting the rate hearing and working through it slowly," said TID Director Michael Frantz. "There will be marginal savings that we are going to create, but I doubt they will change the percentage by more than a couple of points. However, it would be in the favor of the customer when we go back and say we are going to do three percent instead of five percent. It will be a positive thing."

TID staff cited a variety of factors causing the projected $16.7 million shortfall, including the relicensing of Don Pedro Reservoir under the Federal Energy Regulatory Commission, as well as higher labor costs.

"Don Pedro relicensing costs are estimated at approximately $8 million from the years 2015 to 2019," said TID spokesperson Calvin Curtin. "Additionally, we have a workforce that is more technologically advanced, and employees with a higher skill level require a greater rate of pay."

However, the rate increase is not set in stone as of yet, as directors only approved to set a rate hearing date.

Four directors voted to move forward and schedule a rate hearing for Dec. 2, with Director Joe Alamo dissenting. Alamo said he believed that the board should wait until they adopt their final budget to address the public with a rate increase.

"I think we're premature on this; we could find a way to get some additional dollars to bring that $16.7 million down some," said Alamo at last week's meeting. "Also, as we get further into this water year, some extra water in the reservoir would do a lot for our budget."

TID will host three public meetings next month in order to elicit opinion regarding the possibility of increased rates. With the public's input, TID staff will return to present a workshop to the Board, who at that time will further direct staff on how to continue forward, with or without a rate increase.

The board will then reconvene on Dec. 2 to address the increased rates in a hearing.

In 2011, the Board approved a rate increase of four percent per year for three years - 2012, 2013 and 2014. The district also increased rates in 2009, when electric costs went up 15 percent systemwide.