Lesson 4: What a tax promise really costs

The ideas: who pays, "and then what?", and results over goals. Sowell's books ask readers to look past the stated goal. Applied Economics looks at later effects Unverified1. Basic Economics teaches judging a policy by the incentives it creates rather than the goals it announces Unverified2. A tax is a promise: you pay, and the government says what it will do with the money. So is a rate increase. This lesson uses the Williams water and sewer rate increase to practice asking what it costs, who pays, and how you would know it worked.

What the city promised

A rate increase is a trade. Customers pay more, and the city promises something in return. The city's utilities page says the city "is responsible for providing safe, high-quality, reliable water." It says the revenues "will be used to ensure the City can meet State and Federal water quality laws, and construct, repair, maintain and properly operate water supply infrastructure." On January 21, 2026, the City Council adopted a series of water rate adjustments for 2026 to 2030, and the first one took effect in February 2026 Verified3.

The city also posts water and sewer rate studies "detailing the needs for the water and sewer rate increases" Verified5. Those studies are where the city lays out its reasons. We have not used figures from them in this lesson.

The math: what is it per household?

For a home with a small (5/8 to 3/4 inch) meter, the city's schedule sets two fixed monthly charges: water and home sewer. Added together, they step up every February 1 Verified4:

The totals are our addition of the city's two charges. From Dec 2024 to Feb 2030 that is $67.31 a month more, about 57%, or $807.72 more over a year at the 2030 level (C) Calculated4.

Read these numbers carefully. They are the fixed part only. The base charge includes up to 5 hundred cubic feet of water a month, and you pay a separate rate for each hundred cubic feet above that Verified4. Larger meters, apartments and businesses have different charges Verified4. Your real bill is probably different. Check it against the schedule.

Who pays? (U)

The city's rates are charged per account, per month Verified4. Our inference (U): the person on the account is billed. Whether that cost falls on an owner or on a tenant, for example through rent, depends on the home, and we have no data on it Unverified4. This is not something the city's schedule says.

"And then what?" and results

The schedule runs through February 2030, so the cost keeps stepping up for years Verified4. Lesson 5 covers how the vote happened. In Sowell's terms, the repairs and reliable service are the goal. A result is what you can count later. Questions you can ask of any rate increase:

1. Which repairs or upgrades is the money for, and where will progress be reported?
2. What does it cost one household each month at every step, and what happens if the work costs more than expected?
3. How will you know the promised work got done?

← Lesson 3 · Next: Lesson 5, rates and fees →

Sources cited on this page

1. Applied Economics: Thinking Beyond Stage One (revised ed., 2008; first edition 2004), Thomas Sowell (Basic Books; unofficial / third-party; accessed 2026-11-09) Publisher's catalog page. We rely on the publisher's description (it says the book examines policies not only by their immediate effects but also by their later repercussions). We have not checked page text and quote nothing from the book. ↗
2. Basic Economics: A Common Sense Guide to the Economy (5th ed., 2014; first edition 2000), Thomas Sowell (Basic Books; unofficial / third-party; accessed 2026-11-09) Publisher's catalog page. We rely on the publisher's description (it says the book shows how to critique economic policies by the incentives they create rather than the goals they proclaim). We have not checked page text and quote nothing from the book. ↗
3. Utilities page (start, stop, billing) (City of Williams; official; accessed 2026-10-29) Start service with an Application for Service (owners provide a recorded deed); stop service by calling Customer Service at (530) 235-3274 for a Discontinuance of Service form; billing questions by email to aramirez@cityofwilliams.org or voicemail at (530) 235-3274. Links the 2026 rates and the shut-off policy (English and Spanish). The Utility Rates text says revenues "will be used to ensure the City can meet State and Federal water quality laws, and construct, repair, maintain and properly operate water supply infrastructure," and that on January 21, 2026 the Council adopted water rate adjustments for 2026 to 2030 (re-read Nov 10, 2026). ↗
4. Water and sewer rates, scheduled increases (Exhibits A and B, "New rates 2026") (City of Williams; official; accessed 2026-10-23) Monthly fixed and volume rates in effect since December 1, 2024, and the increases scheduled every February 1 from 2026 to 2030. Text layer. ↗
5. UPDATED Prop 218 Notices and Rate Studies (water and sewer rate increases) (City of Williams; official; accessed 2026-11-10) City news post (Nov 20, 2025 listing): continues the public hearing to January 21, 2026 and links the Prop 218 notice, the 2025 Water Rate Study, the Sewer Enterprise 2025 Rate Study Update, and Spanish copies. It says the related studies detail "the needs for the water and sewer rate increases." The studies themselves were not read for this site. ↗