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Rates may remain, gallons may drop
Published October 31, 2009
Rates charged by the city for wastewater consumption can stay at their current levels, but the number of gallons included in customers' minimum bills should drop from 3,000 gallons to 2,000 gallons.
Those are the recommendations of a “cost of service and rate design study” presented to the Del Rio City Council Tuesday night by Nelisa Heddin, vice president of the Austin company Water Resources Management.
“On the wastewater side, the good news is that our analysis indicates that your current rate structure is achieving your revenue requirements,” Heddin told the council.
She noted that the city currently charges residential wastewater customers a minimum bill of $8.19 per month, with a volumetric rate of $2.49. The volumetric rate is the rate charged by the city for water used above the 3,000 minimum gallon level.
“Our only recommended change on the wastewater rates at this point is to reduce the consumption included in the minimum bill from the current rate of 3,000 gallons down to 2,000 gallons. This would have a $2.49 impact, on average, to customers. However, it would increase revenues to the city of Del Rio by $350,000 a year,” Heddin told the council.
She then recapped the recommendations made in the study.
She said the recommended water rate increases would be $4.12 per month for the average city water customer.
“On the wastewater utility side, the impact would be $2.49 per customer per month, regardless of consumption amount. Again, we recommend reducing the gallonage in the water bill from 2,000 gallons to 3,000 gallons in 2010 and in 2014, we recommend reducing one more time to 1,000 gallons.” Heddin said.
She also repeated that the study recommends reducing the number of gallons included in a minimum bill for the wastewater utility to 2,000 gallons.
She added, “We're recommending charging all customers, regardless of customer class, the minimum bill based on meter size. The biggest change to this would be for your cemetery customers. Again, they're paying a flat fee structure, and we're recommending billing based on meter size, just like everybody else.”
Heddin said residential wastewater customers would be billed based on a three-month winter average of consumption. Heddin said winter is used to calculate the average because it is assumed that customers don't irrigate their lawns during those months.
Following Heddin's presentation to the council, Councilman Claudio Sotelo said he had hoped that the council would receive a comparison between Del Rio's water and wastewater rates with those of other cities.
“We can certainly get you some comparison figures,” Heddin said.
Del Rio Mayor Efrain Valdez asked about the possible impact on revenues of excluding the city's elderly residents from the recommended rate increase.
“That is certainly a viable strategy and other communities do utilize that strategy. It comes down to policy and what the policy of this community is. I can certainly run those figures with your staff, if I can get a count of how many senior citizens there are,” Heddin said.
“Of course there are some elderly that will consume 10,000 gallons a month that really don't care if they pay more, but there are some elderly that are on a fixed income, that use the minimum. . . They are my concern,” Valdez said.
Councilwoman Lisa Cadena Craig said young families are struggling as well, and said the current economic climate is affecting everyone.
She also asked if the rate increases recommended for the water system could be spread over a longer period of time.
“Well, the bottom line, though, is that we've got to increase water bills by an average of $4 per household per month to generate the revenue we need,” noted Councilman Mike Wrob.
“Precisely,” replied Heddin.
She said although the council could look at structuring the increases over time, such as “over-increasing” one year and “under-increasing” the next, “at the end of the day, you've got to have the money in the bank to make ends meet.”
The council took no action on the recommendations made in the study. Any rate increases proposed by the study would have to be voted on by the council at a later meeting.
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