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Water, sewer rate increase approved


Following years of conservation, Petaluma residents will see their water and sewer bills increase in July after the city council Monday approved a rate hike for each of the next five years.

Officials unanimously approved annual increases of 3.5 percent and 1.5 percent for the city’s water and sewer rates, respectively and as well as a restructuring of rate tiers for both utilities. The changes, which increase fixed charges, are expected to generate a more stable revenue source for the city as it undertakes projects to keep up infrastructure that serves residents.

Petaluma updates its rates every five years, with the last such adjustment in December 2011. Rates are also adjusted annually to reflect the cost of inflation and increases in wholesale costs from the Sonoma County Water Agency.

With those factors included, an average residential user can expect to see a monthly bill increase of 10.8 percent for water, up from $32.03 to $35.50, and a 4.2 percent increase for sewer bills, up from $65.83 to $68.61 for their July 1 bill. By 2021, the average residential user’s monthly water bill is projected to increase a total of $17.72, while monthly sewer bills will increase a total of $13.99.

The city’s rates will still be among the lowest in the region, according to Alex Handlers, a principal at Bartle Wells Associates, a consulting firm hired to conduct the rate study.

Increases in water rates are necessary to make up for revenue lost when residents scrimped on water, cutting down overall use about 20 percent over the past two years, Handlers said.

“People did a great job cutting back and on one hand that’s great they’re adhering to drought requirements, and on the other side of the coin, it’s hurt the city in terms of seeing a decrease in water sales and water sales revenue,” Handlers said.

Increased cash flow is also necessary to fund the city’s participation in a state-mandated groundwater sustainability program. But, the biggest needs are outstanding capital projects to repair aging infrastructure and to fund a new annual pavement maintenance fee to cover costs associated with the utilities, Public Works and Utilities Director Dan St. John wrote in a staff report. Projects funded from the additional $18 million in revenue include maintenance and replacement at the Ellis Creek Water Recycling Facility, including upgrades that will convert solid waste to fuel for city vehicles, and other repairs to infrastructure.

“This whole thing is built on forward looking projects,” Handlers said. “These are trying to make it so you take small steps each year toward maintaining financial stability and funding capital needs.”

The city received 15 valid protest letters opposing the changes, including from resident Barbara Darling-Severson, who called the rates “exorbitant and unjustified.”

“Get rid of the waste, tighten your money belt, spend the resources you have appropriately and do what is in the best interest of our residents and the common good with what you already have,” she wrote.

Resident Edith Benson spoke to the potential impact on those living on a fixed income.

“As you raise the base, I have less and less control and it’s more and more of a fixed amount,” she said. “I understand what you’re up against, but I also want to note that a lot of people don’t have that much of an income … and another 20 or 30 bucks makes a significant dent.”

Mayor David Glass said the city council opted for the least aggressive increases of the options presented in a series of public meetings. He commended residents for saving water in a “remarkable fashion” and encouraged ongoing conservation.

“We’ve seen equal frustration on all ends of the ratepayer spectrum as a result of this exercise,” Glass said. “One of the components was to try to hold down rates to the degree it was possible for the low end users. That was very much a consideration, and the rates are lower now than at the original starting point of the discussion.”

The council also indicated its desire to check in and assess rates at the annual spring budget discussions, an addition that will allow decision makers to evaluate the current landscape.

“Due to the five year duration of this rate program, it is designed to be conservative, providing adequate funds under a range of economic outcomes. Which means it may provide more funds than needed in some years,” Councilman Mike Healy stated in an email. “Second, there is the opportunity to value engineer capital improvement projects as they get closer.”

Officials also voted Monday to approve the refinancing of bonds issued in 2011 for improvements at the Ellis Creek Water Recycling Facility, generating a total cumulative savings of $4.5 million though 2029.