Carson City panel urges gradual hike in water, sewer fees

Sewer rates for new homes would go from $577 to $4,493 by 2021

Utility connection fees for new homes and businesses could increase approximately sevenfold over time if Carson City’s Board of Supervisors follows the lead of a utility advisory committee.

The Utility Financial Oversight Committee voted unanimously Wednesday to recommend the board increase connection fees on houses or housing developments and businesses to hook up water and sewer, but to reduce the impact by having them phased in by stages over several years. Current charges would rise to the new levels in 20 percent bites over five years to close the gap between current charges and a recommended level in each case.

In addition, the panel recommended the board not start until July 1, 2016, so projects currently moving from drawing board to reality won’t have financial assumptions affected. The delayed phase-in approach took into account concerns from the building and development communities an abrupt hike back to fees at pre-recession levels could put a damper on Carson City’s competitive posture for development opportunities. “Carson City needs to be competitive,” said Tom Metcalf of Metcalf Builders in an e-mail read for the panel and audience by Ande Engleman, committee chairperson. Mark Turner, a developer. made similar points in person and Aaron West, chief executive officer of Carson City-based Builders Alliance of Nevada, piggybacked on both to express concern at the fee levels and later to urge the phasing-in approach.

In a nutshell, water connection fees would go from the current rock bottom $454 per new single family residence to $3,440 by the year 2021 if the city’s governing board follows the fee hike plan and phase-in recommendation. The assumption involved is based on 425 gallons per day in usage per household. Sewer rates, based on 200 gallons usage daily, would rise from the current $577 to $4,493 in 2021. Multiples of those gallons would be used for larger structures, such as restaurants or industrial plants, meaning the connection fees will rise accordingly, Public Works staff indicated.

The recommendations came from city Public Works staff based on analyses provided by FCS Group, the same firm that provided the city with methodologies for decisions on water and sewer rate hikes imposed last year on existing users. Public Works Director Darren Schulz and Utilities Manager David Bruketta said the connection fees would help fund future expansion needs for water and sewer as the community grows larger.

Schulz said he would favor a separate reserve fund to use connection fee revenues in an earmarked fashion for such utilities expansion when it’s needed.

But one of West’s points in opposing large abrupt fee hikes, at least regarding the sewer connection fee, was the current plant is operating well under capacity and so handling expanded needs won’t come into play soon. He called projections “hypothetical dollars” and also objected to talk of raising fees based on higher fees in neighboring Lyon and Douglas counties. “At some point we end up in a race to the top,” he said. Bruketta said both during and after the meeting, as did the FCS Group consultants, neighboring jurisdictions have higher fees.

In other action, the committee re-elected Engleman to serve as chairperson and discussed but put off for a month the issue of who’s going to pay for potable water to supplement treated wastewater used to keep local golf courses from turning brown next summer. The delay was to get a better fix on the city budget assumptions in March.