Council Special Meeting on Water/Sewer Rates

The Eureka Springs Council had a special meeting the morning of May 2, 2008, to address the administration’s proposed increase in water sewer rates. They decided not to take action on either the water or sewer rates until they received more complete information at the next regularly-scheduled Council meeting on May 12.

The City Attorney said postponement would probably be acceptable to the bond company, which re-funded bonds on the sewer plant last year, so long as the increase was enacted before the next billing cycle. May 12 would be in time for bills to get out, Public Works representative Amy Williams said.

Water Rates

The larger part of the meeting on water rates was given over to the impact of lowering the tiers, or ranges, for water usage. The City has three tiers: one is for the first 2000 gallons; the second for the next 8000 gallons, and the last for those over 10,000 gallons. Ald. Rae Hahn had proposed lowering the first tier from 2000 to 1000 gallons.

According to a report provided by Williams, the measure would have increased revenues. It would have also negatively impacted residents, she said, costing them more than the administration’s proposed 9% increase.

According to Williams’ data, resident fees would have gone up 17% for one of the residents she sampled– a figure well above the administration’s proposal. The increase for the commercial interests in Williams’ sample would have been 1%-plus-a-little-bit to 8.5%.

For the next meeting, Williams said she would prepare figures for a flat rate fee. ES Folk has asked that Williams sample the flat rate increase across different categories of users to make sure there would not be a disparate impact on small users (a family of two, for example) compared to a large user (a large hotel). Flat rates frequently have a negative impact on the “lesser” among those assessed at the same time it is presented as “fair” because it provides “equal” treatment.

Sewer Rates

Ald. Harrison said a 9% increase for sewer rates could be justified because of the new plant that has just recently come on line.

Council had little else to say on the sewer rates, postponing action to the meeting on May 12.

The previous discussion of a 60/30/10 split of the one cent tax that had in the past gone to Public Works was not on the table. At its last meeting, Council had repealed all of the sales tax and use ordinances going back to Ord. 1190, passed in 1981, the last taxing ordinance that had been officially and legally approved by the voters, according to City Attorney Tim Weaver. That meant there was no one cent tax going into the general fund, and so nothing to split.

Other Options

Williams said Public Works had looked into other options, none of them bringing in large revenues but perhaps significant for what they might add. She mentioned that other cities often had a non-refundable deposit. She also noted the possibility of reviewing impact fees, fees charged for the impact of new or expanded construction to water and sewer services, police, fire and other City services. These fees can, however, only be used to address the actual impacts necessitated by new or expanded construction.

Williams suggested that Council might want to look into increasing tap fees, the fees the City charges for connecting to its water mains. Public Works currently charges $300. According to Ald. Rae Hahn, Carroll/Boone, which currently provides the actual water to the City, said “most” cities charge $500. Hahn said she was unable to get a reading of how many cities “most cities” included.

Ald. Kathy Harrison asked about charging commercial interests more than residents. Williams said she and Public Works head Dwayne Allen had discussed the possibility but she gave no indication of Pubic Works’ position. Ald. Patrick Brammer told ES Folk that he could support a differential system so long as there was at least some small increase in resident rates.

If enacted, the water/sewer increases would follow almost immediately upon a 30% water rate increase the Carroll/Boone water district recently imposed on the City. Carroll/Boone provides the actual water used by the City.