Click here for more articles
Bayfield water rates set to go up
1/9/2009 By: Carole McWilliams
Bayfield water customers will be paying higher monthly rates this year, and probably higher tap fees.
Town trustees reviewed options this week to eliminate an 18 percent gap between operating revenue from monthly fees, and deferred maintenance needs.
Residential customers now pay $19.80 for the first 6,000 gallons, with tiered rates per 1,000 gallons for use above that. Commercial customers pay $22.10 for the first 6,000 gallons, also with tiered rates above that.
On Jan. 6 trustees discussed three options for rate increases: 18 percent across the board for option 1; 16 percent on the base and 20 and 25 percent increases on higher use for option 2; or 15 percent on the base and 18, 21, and 25 percent on the upper tiers for option 3.
Trustees preferred option 3. Town staff will refine that into a draft ordinance and publicize it for a public hearing in February.
Administrative intern Jack McGroder presented charts showing how many residential and business customers fall into each use category in winter and summer, to show many customers would be affected by the various options.
McGroder reported that 75 percent of residential customers use 6,000 gallons or less per month in winter, and 90 percent use 8,000 or less.
In summer, 46.5 percent of residential customers use 6,000 gallons or less per month; 79.5 percent use 12,000 gallons or less; and 90 percent use 18,000 or less.
McGroder reported that 63 percent of commercial customers use 6,000 gallons or less per month in winter, and 52.5 percent in summer.
The town has a few very high commercial users, up to 125,000 gallons per month in winter, and up to 150,000 or even 250,000 per month in summer.
Option 1 would have the most impact on the most customers, McGroder reported. Option 3 would have the lowest increase for the largest number of customers, with bigger increases than the other options for high users.
Mayor Rick Smith said he looked at all the options in terms of price per gallon. “They are all less than 1¢,” he said.
“I have a big yard, and it was my choice to put in grass” back in the 1980s, Smith said. “I curse it every summer and replace some of it with xeriscaping.”
He said he likes option 3 because it has the lowest impact on the most customers, including fixed-income residents who tend to be low users.
“It spreads the burden more and cuts a bit of slack for the lower end,” Smith said. “It will incentivize me to rip out even more of that lovely grass.”
Trustee Bob Piccoli said he did an Internet search of other town water rates in Colorado. Many charge a base fee and then charge per 1,000 gallons starting from zero, instead of the base rate covering up to 6,000 gallons, he said.
Many towns increased rates in 2007, and they were higher than Bayfield’s rates before the increases, Piccoli said.
Town Manager Justin Clifton said, “Even after an increase, our rates and tap fees will be very favorable.”
One of the ongoing maintenance needs is to replace old asbestos-concrete (AC) water mains.
“We can keep putting off replacing the AC lines, but we really need to do it now,” Trustee Debbi Renfro said.
Clifton said that with more operating revenue, “If something unexpected comes up, we can avoid financing it and paying interest.”
McGroder said, “We accounted for everything in the system – age, five-year replacement schedules… There’s no fluff. It looks like we need around 18 percent” more monthly revenue.
Trustees will consider a water tap fee increase separately to cover growth-related capacity expaansion.
Clifton said a residential tap probably needs to be closer to $7,000 than the current $4,334. Fees for larger taps should increase by a similar percentage, he suggested.
“Our next big expense will be to expand the water plant,” he said. “It will probably be $1 million. Some conservation will push back the need for that improvement by several years and save the customer a lot of money.”
But Clifton warned, “We produced 19 percent more water this year (2008),” far more than the town growth rate. “At that rate the new filter will be needed in two or three years.”
He said, “If we finance the filter (to expand treatment capacity), we would try to pay it with tap fees. … We are losing money in the (water) fund because we are buying improvements for the future and then they (users) pay it back.”