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Council has no interest in raising sewer rates
Despite a study suggesting that sewer rates must be increased substantially for the system to pay for itself, Bonney Lake City Council members and administration have expressed concerns about raising rates in the midst of a recession.
“Asking for any kind of rate increase right now is going to be difficult,” Councilman Mark Hamilton said.
Council discussions in March with the FCS Group, a Redmond-based consultant hired to the study the city’s sewer fund, revealed a projected gap between expenditures and revenues of $2.1 million by 2017. The study showed the city would have to hike its rates by 30 percent to bring revenues in line with expenditures.
The city has been using service development charges (SDCs) charged to builders on each new building built within city limits, to help balance the ledger, but according to the study, that cannot continue indefinitely.
The sewer fund balance is presently around $7 million.
But an enterprise fund like the sewer utility is designed to be run as a self-sufficient business.
At the March meeting, the FCS group presented the city with three options for raising rates to help the fund pay for itself. At a May 18 workshop, the council discussed those options as well as additional alternatives provided by staff that show a less steep increase in rates.
According to the statistics from the city, the cost of maintaining the sewer system comes out to $78. 38 per user per month. The present cost is $56.78 per customer per month.
City staff proposed increases to the basic rate of between 4 and 8 percent over the next four years as well as increases to the volumetic rate (usage) of between 6 and 10 percent during the same time.
At the lowest suggested rate, customers would see the monthly cost increase to $59.48 in 2011 and $68.44 in 2014. At the highest of the staff recommendations, the cost would jump to $61.75 in 2011 and $79.50 by 2014.
Following the four years of set increases, the staff recommended tying the sewer rate to the consumer price index to account for inflation.
Hamilton said three years ago he may not have had a problem with the increases, but in the midst of a recession, he opposes idea.
“Right now it’s the timing,” he said.
Deputy Mayor Dan Swatman expressed skepticism over the consultant’s numbers, asking why the year over year growth of the system is not enough and said he was “not going to be very positive” on rate increases.
The proposed rate increase ordinance also included an increase in operations and maintenance rates for grinder pumps, raising the charge from approximately $7 per month to $16 to cover the cost to the city to maintain the pumps.
Though the council moved the grinder pump issue forward to the May 25 agenda, there was no support for increased sewer rates in general.
The council opted to table the rate increase item for further discussion by the Community Development Committee.