The Futzing around of Council: It Needs to Stop

The City Code is quite specific about water rate increases. Under Muni Code 10.44.04 (G)(4), Fees and Charges, “a rate increase or decrease shall not exceed three percent (3%) in any year (Ord. No. 1894, 11-18-02).” [boldface added]

At present, the Mayor is asking for a 22% rate increase. Council just passed a 30% increase.

From here it looks like the 30% increase was in violation of the law. It looks like the proposed 22% increase will be in violation.

How did we get here?

Automatic Increases Built In but not Used Leads to Unacceptable Increase Today

In 2002-03, Council built in automatic annual increases “based on the South Urban Consumer Price Index, All Urban Consumers (CPI-U) for November of the preceding year as shown in the release from the Bureau of Labor Statistics,” Muni Code 10-44-04(G)(1).

The ordinance provided an example of how to calculate the increase so the method would be clear to later administrations/finance departments.

We seem to be in a situation similar to the one the City was in 2002-03. At that time, when there had been no rate increases for several years, Council was catapulted into enacting what was considered an unacceptable increase, according to the Lovely County Citizen. The residents of the town were so incensed that they threatened a referendum. The crafting of the automatic-increase ordinance, according to the Citizen, was not far behind.

It looks like we have, once again, had no increases for several years now– just as in 2002-03.

The difference is that we today have an ordinance Council is supposed to follow. And we as citizens are under threat of one large increase (22%) on top of a humongous one (30%), leaving us even worse off than the citizens were in 2002-2003.

Automatic Increase Waived Once and Once Only

Following the 30% increase in 2002-03, any increase at all, meaning the automatic increase, was waived for one year only, as stated in Muni Code 10-44-04(H):

The rate increases authorized for the calendar year of 2004 are waived. The waiver shall apply only to billing periods from January 2004 through December 2004 and shall in no way be construed to be a continuing waiver of possible future rate adjustments. (Ord. No. 1943, Secs. 1-2, 2-2-04) [emphasis added].

We are not now under that waiver. Nor should we be.

Increases Not Determined in a Timely Manner

Under Muni Code 10-44-04(G), rates were to be assessed January 1 of each year:

All rates shall be subject to an annual review which may result in a fee adjustment beginning with the January 1st billing period of each year.

At one of the budget workshops this year, in 2007 or ‘08, it was said that two fee increases– the one needed because of the Carroll/Boone Water District increase– and the one called for under the automatic increase as detailed in the ordinance (10-44-04(G)(1)– would be too much to load on the citizenry all at one time.

Turns out neither the Carroll/Boone increase, nor the automatic City increase, was acted on in a timely manner.

On to the Future and Impact Fees

What could Council have been thinking? Surely no one believed that the needed increases would disappear if everyone just sat tight….

Whatever, The Futzing around of Council is not to be countenanced– not now, not in the future, not ever again.

Council should sit down and develop alternatives– new impact fees, for example, that keep up with the development Eureka Springs has been experiencing.

And then Council should stick to their duty to assess as need be, within the 3% limit, the necessary fees– every year, at the beginning of the year. It’s the law.