January 5, 2009 in City, Sports

City Council approves utility rate increases

By The Spokesman-Review
 

Spokane trash, sewer and water customers will soon have to pay a few extra dollars a month on their utility bills.

The Spokane City Council unanimously approved on Monday a 3.5 percent billing increase that had been proposed in the fall by Mayor Mary Verner.

“It was zero percent last year, so we have two years of inflation to catch up on,” Councilman Al French said after the vote.

Public Works Director Dave Mandyke said the average residential bill will increase about $2.75 a month. Cost varies depending on the garbage package selected by a customer and on the amount of water a household uses. All the fees on a monthly residential bill will be affected.

Monthly cost of a 68-gallon garbage bin, for instance, will increase by 83 cents to about $24.50.

“We go through and look at what the cost increases have been to us to provide those services and that’s what it’s based on,” Mandyke said.

The city expects to finish a cost study later this year that will recommend a new utility rate structure.

“We’re falling a little bit behind,” said City Administrator Ted Danek. The costs approved Monday are “just kind of a placeholder until we get the right amount figured out.”

The rate study, which will be completed by an outside engineering firm, also will help leaders determine how to make up for changes made in December to the city’s utility tax.

The city charges its own utility departments a 20 percent tax that it uses to pay for police, fire and other non-utility services. That’s usually passed on to customers, but leaders recently began assessing the tax on some previously untaxed sewer, water and garbage charges without passing on the tax. That means new tax money owed will be taken out of utility revenue and will lower savings in some public works budgets.

Late last year, the council delayed action on utility rate changes because the proposal also included 20 percent increases on some one-time fees, such as prices to hook up to city water service.

“We were attempting to recoup that 20 percent (utility tax) and pass it through,” Mandyke said. “That wasn’t well-received by council, so we rolled that back.”

Councilman Mike Allen said the portion of the plan that affected one-time charges wasn’t properly vetted.

“I would have had no problem with it had they made their case in advance,” he said.

In the final plan adopted Monday, charges that appear in regular billing cycles will change.

“There’s a lot of a policy debate that has to go on” before those one-time fees are increased, French said.


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