Carson City utility rate hike plan clears board hurdle

Rate hikes of 15 percent on sewer service and 6.5 percent for water cleared a hurdle intact Thursday, setting the stage for adoption in two weeks.

The Carson City Board of Supervisors voted 4-1, with Jim Shirk dissenting, for first-reading ordinances now set for approval at the Sept. 19 meeting. The rate hikes, expected to begin Oct. 1, will have widespread impact because they continue increasing each year for five years.

The increase estimates were averages across all rate classes, supervisors were told during an afternoon spent taking testimony that was respectful and basically supportive despite distaste for the need. An ambitious $49.3 million utility-upgrade plan, the largest component for wastewater treatment, spurred that need.

“There’s just no easy answer,” Mayor Robert Crowell told a witness who testified the rates for people on fixed incomes were a problem. The mayor said the city is between the proverbial rock and a hard place with an aging treatment plant that must be improved.

The witness to whom Crowell addressed his comment was Larry Sayer, a retiree who said that when he moved to Carson City a decade ago, water cost $20 monthly, and it’s now $70. He said he didn’t know where people on fixed incomes would find additional money.

Gil Yanuck, Bruce Kittes and John Wagner all testified but seemed supportive despite varied criticism of past handling of utility rates, or other views. Wagner, state chairman of the Independent American Party and a retiree, put it this way: “I hope this project goes froward, but at the least charge available” to Carson City residents.

Yanuck, who’s involved in the city via both the Chamber of Commerce and AARP, said he would have liked another rate class for large residential water users but also focused part of his remarks on past decisions and the current need to upgrade the treatment plant.

“That place is an accident looking for a place to happen,” he said. “I think what’s being proposed needs to be done.”

He said the board needs to ask where rate revenue in previous years went, prompting City Manager Larry Werner to explain a board in the 1990s opted to lower rates rather than retain them at a level to cover reinvestment needs.

Kittes, also retired and a constant city government observer, voiced his preference for spending money on utility upgrades rather than public art. The board earlier had voted 3-2 against an ordinance to provide funding for public art, but supervisors sounded willing to re-consider if a better financing method were found.

Utility Manager David Bruketta said the planned upgrades to the plant he oversees, the sewer system sending waste into it, and water infrastructure prompted the proposed ordinances after a rate study by consultants built in equity, reinvestment and took into account those upgrade needs.

“We put together the rate structure that supports that,” he said.

It would boost the annual water cost for a residence with a five-eighths-inch meter in fiscal year 2013-14 that uses 12,000 gallons monthly from $35.28 to $39.35. In summer months, when use at such a home spikes to an average of 19,000 gallons monthly, the cost would boost from $48.29 to $53.93. Those projections are based on FCS Consulting Group documents.

The FY 2014 cost of a single-family-dwelling sewer bill, according to FCS projections, would increase from $25.02 to $26.61.

With the hikes for other users varying and because they cover multiple years, those initial levels are just the start of ongoing higher utility costs for the foreseeable future. Supervisors expressed concern that a future board might do what the one in the 1990s did, so they added a provision for a community oversight committee.

Werner also mentioned that because the new rates will underpin bonding to cover projects over time, that will help keep the financing method intact to service the debt.