Some Vancouver councilors wary of proposed utility rate hikes
Some members express concern in early budget talks
Monday, October 15, 2012
Faced with a proposed increase of 5 percent each on water and surface-water rates in 2013 and 2014 — as well as smaller increases of sewer and solid waste rates — a few Vancouver City councilors got cold feet Monday night during a workshop on the city manager’s recommended two-year budget.
The council had instructed the public works staff to move to a pay-as-you-go system for maintenance, as opposed to incurring debt by taking out loans or bonds.
The increases would boost the monthly water/sewer/surface water bill for a typical single-family residence from the current $58.43 to $60.52 in 2013 and $62.68 in 2014, or a total monthly difference from 2012 to 2014 of $4.25.
The monthly solid waste rates would increase in 2013 by 38 cents for a residential customer who has garbage, recycling and yard debris service.
After seeing the policy in black-and-white, Councilors Jeanne Harris, Jeanne Stewart and Bill Turlay expressed concerns.
“I really can’t tell you where I’m at on this budget right now,” said Harris, who added she has always been wary of pay-as-you-go.
Turlay, who successfully campaigned against debt last year, and complimented the pay-as-you-go system the day he was sworn into office, said Monday, “I wish I had simple answers but I don’t. There are no simple answers.” He said he doesn’t want the city to take on additional debt, but understands why it might have to be an option.
Stewart expressed concern that the city, in shifting to a sustainable model, may have overcorrected.
“I want to be sure we’re not creating a city the citizens can’t afford to live in anymore,” Stewart said. “I don’t think we’re at this point yet, but we are headed in that direction.”
Councilor Bart Hansen also expressed reservations about the budget, but did not get into specifics. He said he’ll wait for staff members to answer his questions.
City Manager Eric Holmes reminded councilors that he puts the budget together based on a series of policies they approved, so nothing should come as a surprise.
1% property tax spike
Other areas of note in the proposed budget: A 1 percent property tax increase, as allowed by state law, will bring in an additional $400,000 to the city’s general fund. Also, the city will have a net loss of employees over the next two years.
Those losses include 13 firefighters, whose positions were paid by a grant that will expire, and two police officers also funded by expiring grants.
The city did receive an unexpected extension on a grant that pays for three police officers who work as school resource officers at Evergreen, Mountain View and Union high schools, so the projected loss of police officers dropped from five to two.
Among additions to staff will be an engineer whom the state Department of Transportation will pay to work on city-related aspects of the Columbia River Crossing and two building inspectors added because of an increase in commercial and multi-family residence developments.
Utility rates were the most controversial aspect of the $750.7 million two-year budget, which consists of a $681.8 million operating budget and $68.9 million capital budget.
The city council will have a first reading of the budget at 7 p.m. Nov. 5 at City Hall, 415 W. Sixth St. Public testimony will be accepted.
If councilors are ready to move forward, a public hearing will be at 7 p.m. Nov. 19.
By law, the council has to adopt a balanced budget in December.
In 2010, the city council approved a 9 percent sewer rate increase for 2011 and a 6.5 percent sewer increase for 2012. Last year, the council approved a 5 percent water rate increase for this year, along with a 2.1 percent surface water increase and 1.5 percent solid waste increase.
Over the past 15 years, the city’s utility rates have gradually increased, perhaps most notably the sewer rates, which have been used to pay off bonds on $250 million spent on sewer infrastructure and facilities between 1990 and 2001.
Brian Carlson, the city’s public works director, said the city has $600 million worth of water and sewer infrastructure it needs to maintain.
“Things wear out,” he said. “Someone has to pay for it.” The pay-as-you-go system pencils out in favor of ratepayers because they won’t have to pay interest on loans and bonds, he said.
The proposed 5 percent annual increases for both water and surface water rates factor in a 2.5 percent increase for maintenance and 2.5 percent increase for inflation.
The sewer rate increase factors 2.5 percent for inflation for each year. The solid waste rate increase is 1.5 percent, per the city’s contract.
Carlson reminded councilors that Vancouver residents still pay lower utility bills than residents in unincorporated areas or other cities in the county. For example, the $58.43 monthly bill in the city compares to a bill that’s approximately $100 in Washougal and La Center.
There are many reasons why rates vary so widely among municipalities, Carlson said, including the size of systems and how the capital funding works.
Stephanie Rice: 360-735-4508 or email@example.com.