After no public comment about significant proposed increases in water and sewer rates, Durango city councilors agreed Tuesday to proceed with city ordinances to up the charges.
The average household’s total increase for water and sewer services will be about $22.60 per month in the winter – which reflects domestic usage but not irrigation. Sewer services will increase 64 percent, from $21.39 to $35.13 per month. The average household’s water rate will increase 37 percent, from $24.23 per month to an estimated $33.13.
The new rates will go into effect Jan. 1, and customers will see it in their bills in February. The ordinances will also be structured to provide rate increases as costs increase.
Overall, the city needs to raise 55 percent more revenue to fund water improvement and 80 percent more revenue from sewer fees to fund wastewater plant improvements.
Different users will have different rates, including commercial establishments and Fort Lewis College. Houses of worship will be charged residential rates. The bills customers see also will vary based on usage.
The increases include a new base rate city councilors have supported in the past. They have called it a fairness issue, because it requires everyone, even those who live in their homes for only part of the year, to pay for the expenses for the systems that occur regardless of usage.
Water rates include a new tiered structure meant to encourage conservation. The most common base charge will be $12.46, with users paying a flat rate for each additional 1,000 gallons used. Flat rates will vary among different types of users at different times of year.
“Low water users will have greater control over their rate increase,” Councilor Dick White said. “Those who water yards and gardens in the summer are going to have to think harder every summer.”
Sewer rates are proposed to increase to a base residential rate of $13.23 and a flat rate of $7.36 per thousand gallons.
The rate increases are necessary to fund millions of dollars in infrastructure projects and for the two systems to pay for their ongoing operation and upkeep.
“We run these two systems as enterprise funds, which means we run them like businesses,” City Manager Ron LeBlanc said. “Part of this is coming from the rate study the city commissioned, the first since the early 1990s. Because they operate as enterprise funds, paying sales tax doesn’t mean paying for water and sewer improvements.”
The city needs a significant investment in sewer upgrades in order to meet new state standards governing the nitrogen and phosphorous the plant releases into the Animas River.
These nutrients find their way into large bodies of water, where they are creating harmful algae blooms. These necessary upgrades also would make the plant quieter and reduce the odor it sends wafting across Santa Rita Park.
To make all the sewer upgrades in one fell swoop would cost an estimated $55 million, but Mary Beth Miles, assistant to the city manager, said the city also is looking at a phased approach, spending $41.3 million from 2015 to 2019, with the final $14-million phase to be completed in 2016.
The deadline to meet state requirements was December 2017, but the city recently received an extension until 2023. As a result, sewer rate increases will be lower than anticipated.
In addition, the city needs to take out $39 million in debt to help fund water projects. Some of these pressing projects include upgrading the Florida River intake, which provides most of the city’s water supply. Some parts of the intake are almost 100 years old. A new storage tank also is needed at the water-treatment plant.
“We also made a major investment of $5 million in water rights in Lake Nighthorse,” said Chris Wilbur, chairman of the city’s Utilities Commission. “Right now, there’s no way to get that water into the city’s water system.”
People who live outside the city limits but use city water and sewer systems are going to be hit harder by the higher rates.
While the average household in the city will pay an additional $22.60 per month in the winter, those outside the city limits are looking at double that, an increase of about $45 per month.
Increased charges also will come for raw water and water purchased at water docks.
The city plans to make a rate calculator available on its website so city water and sewer customers can see what their individual increases will look like. Miles said that should be up by mid-December.
“I’m apologetic to the citizens for having to hit you with such a large increase, but we’ve let our rates be stagnant when they should have been steadily rising,” White said. “I’m pleased we’re going to have a mechanism in place to prevent another large jump like this in the future.”
This is a problem that’s happening nationally, White said.
“At least locally we have the opportunity to do it right,” he said. “We have to bite the bullet.”
The water and sewer infrastructure problems have been on the city’s list for some time.
“We’ve had three study sessions, several Utility Commission meetings and at least two separate budget discussions,” LeBlanc said. “This council wants to leave a legacy of addressing Durango’s problems so they’re solved for future generations.”