The Stanfield city council looked at options for raising water rates on Tuesday, but decided to delay their decision until after a new city manager is hired.
Tuesday was city manager Blair Larsen’s last council meeting before he departs for a new job with the city of Sweet Home, and he suggested the council table their discussion until October to give a new city manager time to get hired and settled into the job.
Engineers from Anderson Perry & Associates presented four options for increasing revenue to pay for more than $2 million in priority improvements and maintenance to Stanfield’s water system. The biggest proposed jump would more than double most water customers’ bills by 2030.
Dave Wildman told the council that even without completing any of the proposed improvements to the system, rising costs would push the city’s water fund into the red by 2023, resulting in a $1 million deficit by 2030. Those costs range from personnel to equipment to water quality testing.
“You’ve had a pretty healthy water fund over the past few years, but there are trends coming up that call for some adjustment,” Wildman said.
Currently the city charges a flat rate depending on customers’ meter size, then $1.50 per 1,000 gallons of water used. According to the Anderson Perry report, the average “low volume” customer using 10,000 gallons per month pays $41 per month.
Under the first option for raising rates, the city would self-finance about $2.8 million in improvements between 2024 and 2030 by raising rates 10% per year starting in 2020. The average low-volume user would pay $45.10 that year and $116.98 in 2030.
The second option calls for a 25% increase in 2020 and 6% each year after, allowing the city to get started on the proposed improvements to the water system faster using a loan but costing the city more in the long run due to interest.
The third option would change the city’s rate structure, getting rid of the meter size-based base charge in favor of a flat $25 base charge that would include 5,000 gallons of water. Usage between 5,000 and 15,000 gallons would be charged at $1.50 per 1,000 gallons and gallons above 15,000 would start at $2.90 per 1,000. Rates would then be increased 4% per year.
The change would cause low-volume users to see a temporary reduction of rates down to $32.50 in 2020, which would build to $50.03 in 2030. The money for the city to self-finance system improvements would come from high-volume users. Under the current system an average business using 50,000 gallons pays $126.80 per month, which would increase to $147.16 in 2020 under the new structure and rise to $217.83 per month by 2030.
The final option would be to use the same rate structure as option three, but to take out a loan instead of saving up for projects, so that they could be started immediately.
City councilor Susan Whelan said she felt the third option “presents the best option for the city and the customer,” and councilor Scott Challis agreed, saying he liked having the city pay for improvements as it goes instead of taking on debt service.
City staff present at the meeting said they liked the idea that people would get 5,000 gallons of water for “free” with their base rate in that scenario, as they have gotten complaints about Stanfield’s policy of charging per 1,000 gallons starting at zero gallvons.
In light of Larsen’s last day being Tuesday, and the fact that the city has had six applicants for a new city manager submitted so far, the council voted to postpone a vote on a new rate structure until the fall.