We can fix our water and sewer rates!

 

We can fix our water and sewer rates!

Water should never be rationed by price.  Every household should be able to afford to water their yard, protecting their city from fire, as it was before water-rationing rates.  Every household should pay the same charge for sewer within their water service size class, as it was before water-rationing sewer rates. 

·        No unit rates on sewer; minimal unit rates on water.

·        All water overhead paid through monthly base rates to pay monthly utility expenses.

·        Water unit costs covered by a single unit price.

·        All sewer costs equally shared through base rates, no extra charges.

·        Rates to rise by inflation of actual utility costs, not the Consumer Price Index (CPI).

·        No franchise fees.  The City cannot charge a franchise fee for a business it owns.

 

We can do this by putting a city initiative on the ballot, creating a Ratepayer Utility Rate Board for Grants Pass, passing it, and electing its members after it passes.

·        Rates will be set by an elected 5-member Ratepayer Utility Rate Board (Ratepayer Board)

·        Ratepayer Board eligibility is open to any registered voter living in a residence that uses Grants Pass water and/or sewer and who does not work for the city in any other capacity. 

·        Each member of the Ratepayer Board shall take an oath to stick to the above financial principles in setting utility rates. 

·        Each meeting of the Ratepayer Board will begin with a statement of these principles.

·        The Ratepayer Board will meet 5 business days within one week per year to set the rates and shall be compensated $100 per day for their attendance.

·        The City Manager shall provide each member of the Ratepayer Board with the previous year’s expenses of the water and sewer systems, including the Ratepayer Board’s per diem, one week before Ratepayer Board meetings begin.

 

Before we can do any of this, we need: a group to help write the petition; people to circulate the petition for the ballot; and people willing to serve on the Ratepayer Board.  All of this will be quicker and easier with money, so please donate.  We could use a website, too.  All of this must come together before we can even start to circulate a petition.  Fortunately, we get 2 years after the petition is approved to circulate to finish.  Let us know if you are interested in helping.

           541-955-9040                                        rycke@gardener.com

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Rationing rates have relatively low base rates and high unit rates, designed to cause less use of a product or service.  They give us cheap access to water and sewer service and make us pay through the nose to use it.  Worse yet, as use keeps dropping, rates are hiked by more than inflation every year to cover overhead in a very high-overhead business.   Overhead is the cost of the whole water or sewer system, bills that must be paid monthly regardless of use: debt payments; salaries; maintenance budgets; electricity for lights and computers.  Unit costs rise and fall with use of the utility, like water-cleaning supplies and power for pumping.  (Sewer will have no unit price.)

 

Grants Pass has had water-rationing rates since the 1990s but got serious about it in 2006 with much higher tiered unit rates and a lower base rate.  Water use dropped a lot. In 2008, City staff told the Council that their conservation rates had worked so well that the water plant could not pay the overhead.  Staff asked the council to raise the base rate by $3, which they said would stabilize revenues.  Council passed the base rate raise but it didn’t stabilize revenues because the unit rates were too high; the base rate was too low; so people kept cutting back on use.  After that, Grants Pass raised base and unit rates by the same percentage yearly to pay the overhead, until the City Council dedicated $3 million in America Rescue Act money to the new water plant and cancelled the last 2 yearly raises in rates for the new plant to compensate ratepayers.  But they are still raising rates by the CPI and will likely raise them to cover overhead every year.

The city started rationing rates on sewer in 2013, basing sewer units on the average of each winter month’s water use.  Sewer unit rates are especially bad for ratepayers and the sewer system because unit costs of cleaning sewage are much higher than for water.  They are particularly hard on the poor who must live many to a house and put a lot of water down the sewer.  When people cut back on water use by reducing what goes down their drains, they cut the water needed to make sewage flow smoothly.  Since sewage unit rates began, we have had sewage pumps clogging.  This is why we didn’t charge for sewer units before, and Medford and Portland still don’t.

 

When revenues don’t meet overhead expenses, maintenance is the easiest expense to cut.  Grants Pass never budgets what is recommended for replacement of pipes.  We had rationing rates for at least 20 years before we were told that our 80-year-old water plant is falling apart and we need a new one.  Electricity and natural gas utilities started rationing utility rates in the ‘70s, which is why we have had forest fires and gas leaks started by poor maintenance of power and gas lines.

 

Water-rationing rates have spread to cities around the world, making weather more variable and temperatures more extreme worldwide, causing bigger fires closer to cities, sometimes burning right through them, due to lower humidity from much less irrigation.  It’s time to start the Great Ratepayers Revolt by taking control of our city utility rates.

 Rycke Brown, Natural Gardener       541-955-9040         rycke@gardener.com

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Council: Don’t waste our federal funding

 

Our old water treatment plant, still going strong, but slowly falling apart.  The new plant will produce the same amount, but will have room to expand, about 3 blocks behind that big red roof.

            In the July 13^th Daily Courier, we are told that the Council is thinking of using 3 million dollars, a good third of our federal Covid relief funding, to pay for two years of rate increases for the new water treatment plant, an average of $8 per month that would not be added to our bills.  Since we use more water than average, my family would benefit more than most. 

            But such a small benefit would be hollow and temporary, compared to reforming our rate system to pay for all our overhead with base rates and charging only marginal unit costs to our unit rates, the way we used to pay for water when this city was clean, green, beautiful and safe from wildfire.  It is better to take the debt payments off our rates entirely and charge us all but the 18% paid by the Urban Renewal District in our debt payment fee.

We were told, when the debt payment fee was passed, that it would never increase and would go away when the debt was paid.  We were not told that 22% of it would go onto our base and unit rates, where it increases by inflation every year and will never go away.

Some councilors, the Courier said, want to thank essential workers for staying on the job by giving them some federal money.  This is problematic.  Which jobs are essential and who holds them?  How do you find out?  Do the relative few who are paying attention apply and prove it?  It would only cause resentment, dividing residents into classes and paying only some. 

Any money you would give to essential workers would be little compared to what they would gain when you reform water and sewer rates, making it cheap to use water and free to use sewer, like we used to.  A lot of those essential workers are sharing housing and paying more than they should for water and sewer because of water-rationing unit rates.

Housing is what you should spend all that federal money on, starting with two cheap places to shower and sleep for those without secure shelter.  With a few million dollars, you could build a couple of large hostels that can house all our unsheltered residents.  They would be sustainable, because they would be cheap to use, not free.  When you reform our water and sewer rates, they will be more sustainable.

 

Speech to the Grants Pass City Council, 7-21-2021, published at GardenGrantsPass.blogspot.com

Like Ratepayers for Fair Water and Sewer Pricing on Facebook

 Rycke Brown, Natural Gardener    541-955-9040    rycke@gardener.com

Newport has very interesting rates

             I have a new Facebook friend.  Her profile said that she lives in Newport, Oregon so I looked up your water and sewer rates.  These are unique in my experience in that you charge people outside the city the same as inside the city.  You have only about 10,680 people in the city, so you apparently are trying for as many customers as you can get to share the overhead.  I heard you have about 15,000 customers.  You could probably attract more if you make your minimum charges cover your overhead, lower unit rates to actual unit costs, and drop the low-income discounts.

            If Newport uses its minimum charges to cover all overhead plus unit costs within the minimums, low-income households won’t need discounts.  It isn’t base rates or monthly minimum charges that kill budgets; it’s high unit rates.  Low-income people who live many to a house can’t stay within the minimum charge or even close to it when unit rates are high.

This goes double for sewer rates, units for which are generally calculated from winter water use, which is presumed to all go down the sewer.  Three of the thirteen cities on our rate comparison chart still charge no unit rates on sewer: Portland, Oregon; Medford, Oregon; and Redding, California. 

Unit charges on sewage is a relatively new way to ration water and is particularly unfair to low-income people who live many to a house.  Your customers can’t cut the amount of waste they put down the drain, but they can cut their use of the water needed to carry their waste to the wastewater plant.  Get rid of unit rates on sewer and make water units cheap again.  The poor and middle class will be able to afford them again, and sewer pumps and pipes will be less likely to clog.  

Newport has only three water unit rates: Residential, including Single Family and Multi-Family; Commercial, which includes governments; and Single Family low income qualified, which has a 30% discount.  You have no such discount on water for Multi-Family, likely because apartment landlords pay city utilities for their residents.  Few unit rates are a good thing.  A single unit rate would be better.

Newport's unit rates are otherwise flat (no tiers) and pretty high: $4.24/1000 gallons for Residential; 4.77/1000 for Commercial; and $2.96/1000 for Single Family low income.  These are water-rationing rates, but I have yet to find a city without them.  They are remarkable in that residents have lower rates than non-residential users.

Newport doesn’t have base rates, but rather minimum charges according to service size, which are obviously not designed to cover all the overhead, at $19.61 for Single Family Residential 5/8”-3/4” and $13.73 for Single Family 5/8”-3/4” low income, which buys 4,625 gallons and 4,623 gallons respectively.  Multi-Family minimum charge starts at $37.42, which is likely what your minimum charge for 5/8”-3/4” would be if your minimums covered the overhead, as the city wants to get that covered whether an apartment is rented or not. 

            Your wastewater unit rates are also high.  They run $6.62 for Single Family and duplexes, with a minimum charge of 25.81, and $4.63/1000 for Single Family and duplexes low income, minimum $18.07.  Multi-family is $9.82/1000, minimum $29.76.  This is the same as paid by Commercial, which also has extra charges for Extra Strength waste that needs more biochemical oxygen. 

The biggest problem with water-rationing rates is that they cause rates to rise far faster than inflation.  High unit rates are designed to cut use, but low minimums or base rates depend on use to pay part of the overhead.  When they work as designed and people cut back on use to save money, rates must be raised to cover the overhead.  Raising unit rates causes lower use, so they have to be raised again, which further lowers use and rates are raised again.

This vicious pricing spiral continues until people can’t cut back any further.  Seattle may have gotten to that point with water at $15.78/1000g on their highest tier inside the city and over $18 outside it.  Everybody ends up paying more and more to use less and less water with water-rationing rates.

            In any case, high unit rates are not justified by the need to pay for water and sewer plants; they make it harder, not easier.  Their impact on household and business budgets hurts lower and middle-class households who use city water and sewer plants and every sector of our economy except water and sewer rate consultants.  They also reduce hygiene, fire safety, and the beauty and livability of our cities.

Newport may regret these rates if Oregon has another katabatic wind event like September 8, 2020 that blows wildfire right through your town.  Keeping property watered stores moisture in plants and soil and keeps deciduous trees too wet to burn.  You should be encouraging irrigation, not discouraging it.

            Coastal cities have problems with seawater infiltrating their fresh ground water.  More irrigation can fill aquifers and keep the seawater out.  Florida is probably having this problem because they are also rationing water by price and discouraging irrigation.

            I believe that Grants Pass also had minimum charges instead of base rates when I lived here for two years in the ‘80s, because I recall my utility bills being flat except in summer, when unit charges added only pennies to my bill.

 Join Ratepayers for Fair Water and Sewer Pricing on Facebook

 Rycke Brown, Natural Gardener        541-955-9040        rycke@gardener.com

We will pay for this debt forever

Speech to the Grants Pass City Council, 10-21-2020

               A couple of years ago, Staff asked you to pass a debt payment fee for our new water treatment plant, which they said would not increase by inflation, and would go away when the debt is paid.  This made me happy; it was a fixed payment for a fixed cost, and in 30 years, it would be gone.

            Later I learned that only 60% of that debt payment would be in that fee.  I assumed that 18% of it would be paid by the Urban Renewal District that was passed to help us pay for the new plant.  But that still leaves 22% of that debt to be loaded on our rates, an equal percentage rise in the base rate and the unit rates, where it is set to be compounded every year by 4.5 times the rate of inflation, and will never go away.

            A few weeks ago, I asked our City Manager if this was correct.  He has not answered my question about the URD’s 18%, but we did learn in the Courier that our water rates will be rising by 6% every year for 5 years to cover the debt not paid by the fee.  That is in addition to the 6.78% more we are paying every year for 1.5% inflation plus 5.28% to cover the overhead that we are not paying with our decreasing water use.*

            Staff tries to make it sound like they are saving us money somehow by keeping our base rate too low to pay all the overhead, like we used to before the base started being lowered and part of the overhead loaded onto our unit rates to make us save water.  But each customer has only one base rate; we use multiple units, and as we collectively cut back on those units, both base and unit prices are raised to cover that overhead. 

            We used to pay all of our overhead with base rates because that was the cheapest way for everybody to pay for water, and we could use all we needed for any beneficial use, including watering to keep our city safe from fire.  Rates were stable.  Unit charges were literally pennies on the bill. 

Now we are oppressed by high unit charges into paying more and more to use less and less water.  Please cancel the 6% rate increases and make our debt payment fee and the Urban Renewal District cover the whole debt.  Please do the same for the sewer plant debt, which is all being paid with our sewer rates.

*I was wrong about this because FCS did not say what was being paid for in the expected 6.78% rate increases over 4 years that they put in their March 2020 memo’s rate charts.  Staff said that it does include the debt service of the planned new plant.  If that is all that their expected increase covers, they are not planning for increases to cover overhead that have been happening since 2008.  

Staff said, after this speech, that the Urban Renewal Agency (not District) is picking up 18% of water debt service, and that it can be done for the sewer debt as well.

Comment revised 1/5/21.  Shared to RatePayers for Fair Water and Sewer Pricing: https://www.facebook.com/groups/335132417324336

  Rycke Brown, Natural Gardener        541-955-9040        rycke@gardener.com

Youngstown, Ohio Water and Sewer Rates

 

Youngstown doesn't have this available on their website.  It was sent by email.  It was a write-protected Excel spread-sheet, and not all of it printed out, but the important portions did.  I had to type it out as a Word document.  It originally did not have ccf (100 cubic feet) and $ labels.

YWD

Monthly Water Rates

As of February 1, 2020

City                                                                                                                   

Water Consumption (ccf)                  Calculation Formula ($)              

0-1                                                                                 1.32

2-3                                           10.03

4-33                                         (5.17034 * Consumption) - 7.19102

34-333                                     (3.75506 * Consumption) + 39.96302

>= 334                                     (2.81999 * Consumption) + 352.28333

City Sewer                                (7.05 * Consumption) + 32.35

Sanitation                                 24.75

County

Water Consumption (ccf)                  Calculation Formula ($)              

0-1                                                                                 15.84

2-3                                           28.04

4-33                                         (7.23848 * Consumption) + 3.92

34-333                                     (5.25708 * Consumption) + 69.95

>= 334                                     (3.94799 * Consumption) + 507.20

County Sewer                          (7.63 * Consumption) + 10.85

The Natural Gardener: Price Water and Sewer Fairly

It doesn’t take a rate consultant to create fair water and sewer rate systems.  Generally accepted accounting principles would take all the fixed “overhead” costs and pay for them through the base rate, and pay for the unit costs, which vary with the amount of clean water produced and delivered, in the unit price.  This pays for the cost of providing clean water in the base rate, pays for unit costs in the unit price, and keeps the finances of the plant stable.

It takes a rate consultant, using arcane formulas, to assign overhead costs to particular customer classes’ unit rates and thus give governments, businesses, apartment dwellers and smaller households lower rates than larger families in single family homes, who are often poorer people sharing increasingly high housing costs.

When I lived here in the ‘80s, we paid $25 per month for water and sewer. The city was clean, green, and beautiful. When I moved back here in 1999 and bought a house for me and my two children, I paid between about $50 in the winter and $75 in the summer.  The difference was that the water base rate was $13 lower and unit costs were charged.  This city was drier and dustier than before.

In 2005-2006, the City hired a rate consultant to devise a water rate system that saved water, though the city had no need to do so, with large water right and a dam to keep our river running.  They lowered the base by $4 and started a three-tiered unit rate system, with higher marginal unit prices only on single family homes: not on governments; businesses; apartments; or PUDs.  My water bill more than doubled, bringing the combined bill to $140 in midsummer. 

A lot of people quit watering.  Within two years, the City had to raise the base rate $3 to pay the overhead.  It has continued to increase it since; it is now at $17.70, more than double the 2006 base rate, as more people stopped watering due to high unit prices.  My combined bill has risen to $183.

A few years ago, the City decided that people should pay for their sewer use based on winter water use, so that they would pay for every unit of wastewater cleaned.  My sewer bill doubled, from $20 to $40, as the base rate was cut and unit costs were charged.  They are now rebuilding parts of the wastewater treatment plant and raised wastewater rates 7% on both the base and the unit price per year for four years starting last February and 7% more each year for the next three.  My sewer bill is now over $70, as we had 7 people in our house last winter, up from 3.

Now the City plans a new water treatment plant.  Their rate consultant literally doubled down on tiered rates and high unit prices.  They will be voting to raise water rates soon.

State law requires that fees for government services be no higher than the cost of providing that service to each customer separately, not collectively.  Base rates for water and sewer that don’t cover the cost of overhead and corresponding high unit rates make larger households pay more per unit for water and sewer than smaller households and destabilize the finances of our water and sewer plants.  Ask the City Council to put all of our overhead in the bases, and only unit costs in the unit prices, to keep the utilities’ bills paid and the residents able to afford to use all the water we need.

Email the Grants Pass City Council and Mayor: mayorcouncil@grantspassoregon.gov

Rycke Brown, Natural Gardener               541-955-9040                 rycke@gardener.com