City hikes water, sewer rates

"If you guys raise the water rates this isn't going to be a quaint and beautiful little town, it's going to be brown and ugly," said Bob Palmer.

For the typical home, the monthly sewer rate will go up from $26 to $36, while the water rate increases from $14.35 to $22.17. The new water fee will include the first 10,000 gallons used per billing period between June and September and the first 5,000 gallons from October to May.

"If you're going to get an increase in rates it seems we should also get an increase in usage, otherwise the people are getting shortchanged," said Bill Griffith.

However, city officials said the rate spikes were necessary to cover current deficits in maintenance and operating costs. Steve Everroad, city finance director, said those expenditures are only to keep going up since the city is looking at the possibility of a $19 million bill to replace a central water main.

With the current utility budget increasing by 14 percent annually since 1991, while revenues have gone up by only nine percent, Steve Everroad, city finance director, said the net income for the two services has steadily declined.

In addition, the city just completed a $5.4 million upgrade of its sewage treatment plant. Although the municipality received about $3.5 million in federal grants for the project, it financed the $1.9 million balance through a 25-year term loan with the state at an average interest rate of 5.33 percent per annum.

The Jan. 14 council action was based on a report presented in December by Ray Bartlett, a Portland financial analyst under contract with the city.

Bartlett recommended that the rates be raised immediately to cover both current and future costs. He said even with the increased fees, Hood River would still be below the state average for similar-size cities of $40 for sewer and $25 for water. Currently, Ice Fountain Water District, which serves 1,700 clients in Hood River's urban growth area, charges $23.48 per month for the first 3,000 gallons of residential water usage.

Bartlett forecast that the monthly water fees might have to be hiked annually to meet growth needs, to as high as $28.04 by 2004 (three-quarter-inch meter service) with sewer costs up to $42.