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| About those water and sewer rates . . .
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| Rates are on the rise for a variety of reasons
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 | | ROBB CORBETT | | rwcorbett@cityofprineville.com |
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Several months ago, a gentleman wrote a letter to the editor requesting information from the city about the water and sewer rate increases. The letter did not seem to carry any malice, but a genuine concern about the rapid rise in rates, and a request for information justifying the increase in these rates.
Our work with respect to the water and sewer system for the community is dictated to us by the city council through their policies. These policies include ordinances and financial budgets. Council policy directs staff to: "facilities and equipment in a manner that protects the investment of precious tax dollars."
Current rates for most water and sewer customers in the city are $12.68/ month base rate plus $1.32 per 100 cubic feet of water used (approximately 750 gallons), and $47.65/month for sewer. The rates are set by the city council, after hearing recommendations from staff on the needs of the systems. These needs include operational costs, maintenance costs, and debt service.
Debt service requirements are for expansion of the water and sewer system that took place before System Development Charges (SDCs) were in place, or to pay for debt not covered by SDC revenue.
To be clear, System Development Charges or SDC's, have been in place for several years, and paid by people who are building new homes or businesses in the community. These funds are used to expand our water, sewer, and transportation systems. There is some risk to the city, if it borrows funds to pay for expansion and the expansion and the SDC funds don't come in. However, recent policy changes have occurred to decrease this risk.
One factor that drives our sewer rates up is an agreement the city entered into with the State of Oregon, borrowing money to expand our sewer treatment plant. This agreement has rate requirements that must be met. The state offers low interest loans, but includes in the agreement rate requirements, to insure that cities adequately charge for services. The state's concerns are based on their history with cities. They have seen cities postpone rate increases because of the local politics, and thereby postponing necessary maintenance and repairs. Cities then have turned back to the State of Oregon asking for help.
Current city council policy dictates that this is our system, and we have the responsibility to properly maintain it for our future generations.
Another element impacting our recent increases in water and sewer rates go back to the history of these rates in Prineville. Water and sewer rates remained constant from 1992 until 2000. The decision to maintain these rates for an extended period of time effectively decreased the cities ability to properly maintain our systems. Each year the cost of maintenance increases. If one assumes that rates are adequate to start with, and we fail to increase rates for an extended period of time, we effectively decrease our ability to properly care for the systems.
As an example, recent increases in petroleum have driven up the price of water pipe, used to replace old lines in our system. If the city chooses not to increase our water rates, our ability to properly replace and repair water pipe would be reduced. The longer we choose to keep rates the same, the greater the gap between what the system needs and what is getting done. We are decreasing the system's effectiveness and postponing the required work for future city residents to pay for.
These costs can be compounded, as in the example of water wells. If the city properly maintains the pumps, the pumps will continue to produce water at their current capacity. If maintenance of these pumps is postponed for lack of funds and/or manpower, the pumping capacity can decrease, and only be restored to its original capacity at a much larger cost to the city.
Currently the city has a great deal of Inflow and Infiltration (I & I) into our older sewer lines, because of poor maintenance. I & I is groundwater, or surface water, that "leeches" into our sewer pipes through failing pipe joints or manholes. The 2005 Wastewater Master Plan indicated that as much as 600,000 gallons per day of sewer flow into our treatment plant was I & I. At the current average sewer flow of 315 gallons per day per home, this equates to over 1,900 homes of capacity that is lost.
Recent increases in sewer rates have enabled the city to make much needed repairs to our system. We are currently gathering data, but recent staff reports indicate that we have made great strides in eliminating I & I, essentially expanding the capacity of our treatment facility.
Increases in business at Meadow Lakes Golf Course enabled the city to reduce rate payer contributions toward that facility by 30 percent or $150,000. The long term objective is to have the facility generate revenue for the city, further offsetting rates.
Finally, the recent rate increases have been to essentially "catch up" on maintenance that was postponed and to bring the city into compliance with the State of Oregon. There are many more details that could have been talked about on this topic. I would be happy to respond to specific questions.
Our budget and other information is available on our Web site at www.cityofprineville.com.
Robb Corbett is the City Manager for Prineville. He can be reached at: rwcorbett@cityofprineville.com |
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