Bend takes up water rates

City Council seeks structure to fairly distribute costs

By Hillary Borrud / The Bulletin / @hborrud


Published Apr 11, 2014 at 12:01AM / Updated Apr 11, 2014 at 10:25AM

What city councilors say about water rates

Mayor Jim Clinton: “I have a simple (objective) to propose, that everyone pays the same for a cubic foot of water, and that every cubic foot of water costs the same.”

City Councilor Mark Capell: “With regard to (Clinton’s proposal), (Clinton) and I have both been advocates of that for as long as I’ve been on council. The challenge with that is, what do you set as your fixed costs? We’ve taken a couple stabs at that in the past and haven’t really gotten there very successfully. You can quickly make it so that depending on what costs you’ve allocated into the fixed category, the high user could be subsidizing the low user, or vice versa.”

City Councilor Victor Chudowsky: “I’m a little bit hesitant about using water rates to pursue social goals. I think the primary thing should be to efficiently fund the operation of this set of infrastructure, in the fairest way possible.”

City Councilor Sally Russell: “We should also incentivize people to use our infrastructure at certain times of the day, when it’s not overloaded. Because that allows us over time to not expand our system, to continue to accommodate growth, and to have a system that still supports us.”

City Councilor Scott Ramsay: “ ... I think that we as a council need to figure out how to set some sort of policy moving forward, knowing there is always some sort of repair, maintenance, expansion as we grow, and we should be planning ahead for that and avoid the sticker shock that it costs in the future when you actually are forced to deal with those problems.”

City Councilor Doug Knight: “In addition to rates being affordable so that they’re accepted by the community ... the next most important thing would be to increase them, if you need to, in a measured way. Had we increased our rates in a measured way prior to the onset of the surface water project, we would not have had the same kind of community backlash against the project that we did.”

Mayor Pro Tem Jodie Barram: “Some of the goals that I’m interested in are making sure that the rates are equitable, that the first drop of water costs the same as the hundredth drop of water. I think that’s important for ratepayers, and something I hope we can achieve. Conservation is going to be important, but I don’t know that rates are going to drive that. ... And having it be the true cost of delivery, that’s something that is important.”

Bend city councilors are once again discussing potential changes to the way the city charges customers for water.

The issue has come up for discussion repeatedly in recent years, and city councilors have said they want a rate structure that would more fairly distribute the costs of the water system among customers, but officials never made a decision. The city hired a new part-time policy analyst in January to lead the process, and she has started to discuss what city councilors want a new water rate system to achieve. Goals the council might discuss include fairness, conservation and setting aside money for future investments in the water system.

Senior Policy Analyst Gillian Ockner said on Thursday that she hopes to identify guiding principles and objectives for new rates before July 1. As for when the city might implement new rates, that is unclear at this point. Ockner said it is her job to lay out a strategy to implement new rates, and she expects to discuss water rates with the City Council on May 7 and again in June. In the meantime, residents can comment on water rates on the city’s feedback page, BendVoice.org .

At this early stage, city councilors have not discussed the specifics of a new rate structure so it is unclear whether residents’ water bills will increase, decrease or stay the same. At a City Council meeting in March, Ockner told councilors there is a disconnect between water customers’ willingness to pay for municipal water systems and their everyday consumer choices. Ockner noted the city has to treat drinking water to make it safe, and maintain a system to deliver it to customers.

“There’s a lot of work that goes into delivering clean drinking water to our doors,” Ockner said. “But I don’t think we perceive it that way. It’s similar to bottled water, yet a 16-ounce bottle of water sold for, let’s just say $1.25, is equivalent to $10 a gallon, which is thousands of times more than out of a tap.”

Ockner said the issues driving up the cost of drinking water, sewer and stormwater services include aging and deteriorating infrastructure, increasing personnel costs, stricter regulatory standards, decreasing water demand, meeting the demands of population growth and climate change.

Currently, the average monthly water bill in Bend is $24 during winter months and $48 during summer months, according to a city presentation. Residential customers pay a base rate of $21 a month for the first 400 cubic feet of water they use, then $1.60 per each additional 100 cubic feet of water. Residents also pay $46 a month for sewer service.

People have reduced their water use in communities across the nation, and that poses a problem for utilities as revenue declines. The recession, prevalence of more water-efficient toilets and fixtures, public interest in conservation and higher water rates have all contributed to this trend, Ockner said. Municipalities might respond by raising the rate per unit of water, but that creates a cycle in which customers further reduce consumption.

Ockner said she wants city councilors to focus initially on the goals they hope to achieve with the city’s water rate system, and that will drive the process of determining a new structure.

Mayor Jim Clinton has said the current monthly water allowance overcharges small users and undercharges larger water users. Other city councilors have also said the current system is unfair to small water users.

A couple of years ago, the city Infrastructure Advisory Committee recommended that Bend eliminate the flat fee for the first 400 cubic feet of water each month, and instead move to a water rate system based more on the amount of water people use. However, this model would not necessarily lower the bill for people who use little water, because the city might increase the fixed fee for services such as fire flow — the constant availability of water at the correct pressure to fight a fire — that everyone receives. Also, the city could begin charging this fixed fee to everyone connected to the water system, even if a property is in foreclosure or homeowners are out of town.

Ockner said the city of Bend needs to adopt rates that allow it to save up for future projects, not just focus on immediate needs. “The increases have been largely project specific in recent years,” Ockner told the City Council at a meeting in March. Ockner also said the City Council should consider how to best structure all utility rates — sewer and storm water, as well as drinking water — at the same time.

— Reporter: 541-617-7829, hborrud@bendbulletin.com