County authorizes utility rate hikes
March 10, 2014
Facing a June 30 deadline, county commissioners voted 4-1 Thursday to raise Carson Valley Water Utility water and sewer rates 3.25 percent for the next five years.
The average water customer will see an increase in the monthly bill from $65.51 in fiscal year 2015 to $74.22 in fiscal year 2019.
The current water rate, $63.25 per month, is in effect until June 30.
The sewer rate will undergo a similar increase.
The current monthly sewer rate is $61.43 per equivalent dwelling unit.
Public Works Director Carl Ruschmeyer said the purpose of the hikes followed the board's policy directives for the water and sewer utilities to be stable, self-sufficient and build reserves.
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Ruschmeyer said the five-year plan doesn't lock in the rates. He said they are subject to continuous review.
He reminded the board that two years ago, customers were looking at a 9.5 percent increase.
"We're at one-third of that," Ruschmeyer said.
He also pointed out that two years ago, there was a 14 percent drop in water consumption.
"At the time we built the consolidated rate, we set that as a base level," Ruschmeyer said. "Water use has rebounded. We're at about a 13 percent increase."
County Manager Steve Mokrohisky said staff didn't set out to say what the rate should be.
He said the new rate was a result of the county's system reinvestment policy.
In a report to the board, Ruschmeyer said the utility's assets total approximately $32.4 million.
"While the age and year of construction of the assets vary, a majority of the infrastructure is relatively new in terms of asset life. For this reason, the funding of system reinvestment will continue to benefit and improve the financial health and stability of the utility," he said.
He pointed to the Lake Tahoe water systems as an example of what happens with failure to maintain the systems.
"Failing to fund system reinvestment will result in additional future costs associated with debt financing and may negatively impact the county's ability to respond to emergencies and capital needs in a timely and responsive matter," Ruschmeyer said.
Commissioner Barry Penzel voted against both hikes because he said county didn't have a plan beyond stabilizing and increasing water rates.
Prior to discussion on the increases, he proposed freezing the rates for two years in favor of creating a citizen's task force or formal group to oversee the rate structure.
"Increasing the water rates might verge on irresponsibility," Penzel said. "We need first to have a plan to make sure we can take care of the systems we have.
"We should know before we pay what we're going to get," he said.
Penzel introduced a resolution, which his fellow commissioners did not support, to create a task force or work group for the county's utilities.
Penzel compared it to the road funding task force that recently completed a year's work.
Lynn said the two topics were "fundamentally different."
"Nitrate plumes, etc., are not within the purview of an ordinary person," Lynn said. "We would be telling the public works department, 'We don't like you, don't trust you, and want your work done by untrained citizens.' This is a bad idea. It is likely to generate no useful input and more dissension. I am unequivocally opposed to it."
Following adoption of the new rates, the county must advertise the change for 30 days, adopt a rate resolution May 1 and implement the schedule July 1.