Water bills on the rise

WASILLA -- A glass of city water just got a little more dear.

City of Wasilla water and sewer customers can expect a sharp increase in their next bill, with water rates going up 44 percent and sewer rates 16 percent as of July 1. The only comfort homeowners might find in the change is that they are not alone -- large consumers such as Fred Meyer and Wal-Mart will see the same percentage increases in their bills.

For example, homeowners who use the minimum amount of water of 5,000 gallons or less will watch their combined water and sewer bill go from $38 per month to $48.50. The largest consumers, using 250,000 gallons or more, will have their monthly combined bill increase from $1,900 to $2,425.

After more than a month of public debate, the Wasilla City Council this week approved the rate increases, but not enthusiastically. Council members Colleen Sullivan-Leonard and Howard O'Neil voted against the change, and while Diana Straub, Noel Lowe, Robert Sande and Ron Cox voted in favor, several said they did so reluctantly.

"I hate this rate increase, but I see the need because right now we're operating on one pump, one well," Councilman Cox said. "I'm not about to tote water. I can, but I won't."

In the end, Cox said, he was voting for the rate increase because "the need is greater than the pain of paying."

The increase will generate an additional $236,000 per year for the city, which the administration says is needed to help pay for a new Bumpus reservoir and necessary expansion of the city's water and sewer systems. Currently the city has just one well, located on Spruce Avenue, and if that were to fail city residents and businesses would be left without water. Much of this project was funded through grants, but the city was forced to use loans to cover some of the costs.

But the need for a backup water source isn't enough to justify a rate hike of this kind, according to some who spoke against it. Several speakers testified at recent Wasilla City Council meetings that capital improvements of these sorts shouldn't be paid for with user fees.

"The proposed increases are going to be really hard on people living on fixed incomes," Wasilla resident Anne Kilkenny wrote in a letter to the council. At the same time, she argued, tourists, visitors and others use city water and sewer.

"Everyone benefits, therefore everyone should pay," she wrote. "These expenses should be paid by sales tax revenue and through bonds."

Some council members seemed to share this concern. Cox said he has been skeptical of utilities that raise fees to cover capital expenses.

"I always thought that was kind of crooked," Cox said. Unlike private utilities, the city of Wasilla doesn't profit off its water and sewer system, but Cox said he was still uneasy about the new rate schedule.

"I think the city is very honest … But I do think the rate increases are a little bit high," Cox said.

Councilwoman Straub asked the administration how much the city would have to increase the mill rate on property taxes in order to cover the debt without raising water and sewer rates. The answer -- a half of a mill point would have to be levied in order to raise $200,000.

The suggestion was not well-received.

"This is a fundamental shift in philosophy," Mayor Dianne Keller said. Keller's budget for next year keeps property taxes at .5 mill, and the mayor has been quick to point out that this is the same mill rate as this year, and since 1997 represents a 67-percent reduction in property taxes.

Both she and Councilman Noel Lowe said user fees were a more appropriate source of money for the system improvements, and that enterprise fund such as water and sewer should be self-sufficient and not dependent on city subsidies. Lowe said the key to keeping rates low in the future will be for the city to attract more people to hook up to its water and sewer systems.

The majority of the council, however, still seemed uncomfortable with the bottom line for customers.

"The yes vote is just so we can continue to move forward," Councilwoman Straub said. "I think this is the best we can do for right now, but not the best we can come up with in the next year."