Funding

The Southern Nevada Water Authority's $2.75 billion Capital Improvements Program (CIP) is funded through the following sources:

• Regional Connection Charge
• Quarter-Penny Sales Tax
• Commodity Charge
• Reliability Surcharge
• Public Land Management Act

SNWA Regional Connection Charge

Residential and commercial customers pay the Regional Connection Charge when they initiate a new water service. The charge is based on size of service (meter size), residential unit density or land use. This method of computing the Regional Connection Charge provides a better matching of connection charges with water use. About 57 percent of the CIP is funded through connection charges.

Quarter-Penny Sales Tax

Southern Nevadans approved the quarter-penny sales tax increase in 1998. Voters overwhelmingly approved this sales tax because it placed more of the burden on tourists and higher income individuals. Many basic expenditures such as food, medical care and mortgage payments or rent are not subject to sales tax. The quarter-penny sales tax funds about 28 percent of the CIP.

SNWA Commodity Charge

The commodity charge is paid monthly by Southern Nevada residents who are connected to a municipal water system. Funds raised from this charge are used to improve water quality and enhance the reliability of the water system. Effective Nov. 1, 2005, the Water Authority commodity charge is 10 cents per 1,000 gallons of water used and is applied to all customers. This accounts for about 10 percent of the CIP funding.

SNWA Reliability Surcharge

Every customer needs to be able to turn on the tap and have water come out. The reliability surcharge is based on the concept that customers have varying levels of critical need for water and should pay accordingly. The surcharge shifts some of the financial burden of costs associated with reliability from residential customers to all other customers. The rate, which is applied against the total water bill with a few line item exceptions, has been set at 0.25 percent for residential customers and at 2.5 percent for all other customers. The reliability surcharge provides about five percent of the CIP funding.

Public Land Management Act of 1998

Congress passed the Southern Nevada Public Land Management Act of 1998 to help the valley deal with some major growth issues. Under this law, the Bureau of Land Management office in Nevada was permitted to auction several thousand acres of the valley's public land. Ten percent of the proceeds from the sale of these public lands are given to the Water Authority to help improve the water delivery system. The Water Authority has received approximately $280 million as of June 30, 2006.