CM Wong questions OMB on water rental payments diverted to general fund

Your financial plan projects total water and sewer charges of $2.318 billion in FY26 and $2.39 billion in FY27.

Separate from that, the city is also extracting a rental payment of about $303 million in FY26

and $312 million in FY27 from the water system for general budget use.

Question.

How do you justify asking ratepayers for more than $4.7 billion in charges over two years while still diverting hundreds of millions of dollars away from the system?

Our world-class water system needs to be invested in.

That's why we have the Water Authority, obviously, and rates go to fund the improvements in maintenance that...

make sure the system reaches its intended result, which is water access and delivery that we critically depend on.

I think that with respect to the rental payment, the rental payment was already included in the revenue forecast.

If we were to back out the rental payment, that would be a $300 million hole in the budget that we'd have to make up elsewhere.

Yeah, but over here is for general budget use.

It doesn't say that money's been taken out for maintenance and repair of the system.

That's why it's concerning to me.

The rental payment has existed and is part of the revenue forecast that has no impact on what the overall maintenance of the system will be.

And it was already put into the forecast.

And if to take it out would mean that we would have to make up that funding elsewhere.

Do you have anything to add?

No.

That's all right.

Thank you.

I'll follow up with you on this.

Thank you.

Thank you, Chair.

Great.

Okay.

Council Member Jay Sanchez, followed by Lewis.