The Hermiston City Council voted unanimously to raise water and sewer rates Monday.
The rate restructure will take effect in March 2019 and is expected to raise about $2 million additional revenue per year that the city plans to put toward maintenance and upgrades.
Instead of merely increasing current rates by a specific percentage, the council approved a complete rate restructure. Rates will be the same for residential and commercial customers, based entirely on usage and flipping the script so that larger users will now pay more per 1,000 gallons instead of less.
The new structure will charge $35 a month for sewer service plus $3 for each 1,000 gallons of use, based on wintertime usage. Water users will pay a base charge of $30 per month, plus 50 cents per 1,000 gallons up to 15,000 gallons and $3.50 per 1,000 gallons thereafter. Assistant city manager Mark Morgan said he calculated his own bill will go up about $14.39 a month for sewer and an average of $18.03 a month for water under the changes.
Morgan said even after paring down the list of capital improvement needs by millions of dollars, the public infrastructure committee has still determined the city needs $600,000 per year to replace old water and sewer pipes, plus additional money for new projects to increase capacity.
“We’re to the point where we’re getting down to projects that need started sooner rather than later,” he said.
Under its current rate structure, Morgan said, revenue falls “hopelessly short” of paying for any of that, mainly because of the $2 million a year the city is paying on the debt service for the new recycled water treatment plant built in 2014.
When the treatment plant came online in 2014, the city reported that the $17.2 million upgrade was putting out recycled water “virtually indistinguishable from drinking water,” with suspended solids at 0.7 parts per million instead of the previous 20 ppm. The city won a state award for its innovation in sending the recycled water to an irrigation canal for agricultural use instead of into the river. City manager Byron Smith told the city council that year that the final phase of the project, the outfall pipe carrying water away from the plant, came in $1 million under budget.
Councilors said they felt the new structure was the most fair way to raise revenue. Commercial users like car washes will now pay more for sewer than law offices, instead of everyone paying a flat fee. Small water users will no longer subsidize large users getting a bulk discount. Basing bills more on usage also encourages conservation in a critical groundwater area.
“I think this is probably the fairest, most equitable plan we could come up with the address needs in the city,” said councilor John Kirwan, who is the council liaison to the public infrastructure committee. He said there were originally $27 million in projects on the committee’s list.
Mayor David Drotzmann said that people take for granted having water every time they turn on their tap, but it costs money to make that happen.
“We do have some failing infrastructure to address, especially as the city continues to grow,” he said. “If we don’t approve these things then we have emergencies, and where does that revenue come from?”
Morgan said in looking at 31 comparable cities in Oregon, Hermiston’s rates were the second-lowest this summer. The new rate increase will put Hermiston at 11th-lowest in that group, assuming that no other cities raise their rates between now and March.
Contact Jade McDowell at firstname.lastname@example.org or 541-564-4536.