If you flush less, you pay less. That’s the idea behind Spokane’s proposed sewage rates for the next three years.
According to the plan, which will be considered by the Spokane City Council on Monday, apartment dwellers and the bottom 20 percent of water users will be given discounts on their monthly sewage bills. Multifamily residences would pay $2 a month less, and low water users would see their monthly bills shaved by up to $5.
Also Monday, the council will consider raising trash, water, wastewater and stormwater rates by 2.9 percent each year for the next three years. The increase is based on inflation, city officials say.
Currently, all residential utility users pay the same sewer rate, regardless of how much water goes down their pipes. City residents pay $27.27 a month in wastewater rates and those with homes connected to city sewers but who live outside city limits pay $54.55. Compared to the water and garbage systems, which charge based on usage, the wastewater system has been one-price-fits-all.
“We have a big imbalance in our rate structure, with low utility users subsidizing high utility users, and multifamily subsidizing single family,” Councilman Jon Snyder said. “That’s part of the reason I’ve voted against utility rate increases the last two years in a row.”
Proposed rate increases have earned Snyder’s support only because they’re tied to the sewage discount program.
Councilwoman Amber Waldref, who also supports the plan, said she is more interested in the conservation credit, which will affect 12,500 households. She pointed to single, retired seniors on a fixed income who are likely to use less water, yet pay the same as the family next door.
“I tend to be more concerned about the single family rate because that’s the most people I hear from,” she said.
Snyder, who said Monday’s vote is the end of a “five-year process to get here,” said he believed the multifamily discount would have a greater impact than the conservation discount. He pointed to houses in his district that have been split into four or five units, many of them on the South Hill or in Browne’s Addition. Each unit pays the full utility rate, whereas a similar-size house next door that isn’t split into apartments pays just once.
“I think what we’re voting on right now is pushing the pendulum in the right direction,” he said.
Because the amount of water flowing from a home into sewers isn’t measured, the city will determine who gets a sewer rate discount by examining the amount of water a residence uses in the winter – when the city assumes nearly all the water piped into a home flows into the sewer instead of a lawn.
Waldref credits Rick Romero, head of the city’s Public Works Department, with devising a way to fund the program, which was realized after the city received a favorable interest rate for the $200 million green bond it issued last week. The debt is funding a major construction project that will rebuild much of the city’s sewer infrastructure.
The city predicted that the bond’s interest rate would be 4 percent. But the best offer for the bonds during competitive bidding last week came in at 3.08 percent from Citigroup Global Markets. The result is that the city will pay $1.8 million less to pay off the debt on the bond. The city will use its savings to fund the credits.
“There’s a nice opportunity here, between the great credit rating we received for the bond and the interest climate we’re in, to pay some back to our ratepayers,” Romero said. “Once (the credits) go into place, they stay in place, so they’ll be a permanent part of the rate structure.”
The rate plan would be the first time the city approved utility rates for longer than one year. The proposed 2.9 percent-a-year increase is based on Romero’s calculation of the 25-year average of the consumer price index, a measure of the changes in prices for goods and services bought by households locally.
Snyder said the discounts are being considered because of the bond’s low interest rates and because a majority of the council demanded them. “They realized they needed a majority to pass these rates. We have a totally different council. We have two new members,” Snyder said, referring to the five-person bloc of like-minded liberal members. “The green bond is a pain-free way to do this. Usually when you lower somebody’s rates, someone else has to pay.”
Waldref said she supported rate increases last year because discounts were in the works.
“I voted yes because Rick promised me that he would bring this forward,” she said. “And here they are.”
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