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Steamboat Springs — City of Steamboat Springs water customers will see their water rates increase next month for the first time since 2001.

The Steamboat Springs City Council unanimously approved a 5 percent increase in water service and quantity charges at its meeting Tuesday. There will be no increase in tap fees. Interim Finance Director Bob Litzau referred to the increase as a baby step.

"The 5 percent is really a start in terms of raising rates," Litzau said. "I fully expect we will be coming back with a further rate increase."

Higher rates will take effect Feb. 1.

In requesting the rate increase, city officials said the city's water utility fund has spent more than it has collected for several years. The city's 2008 budget shows the water utility fund reducing its reserves to $7,206, an amount Litzau called unacceptable.

Increases proposed for 2002 and 2003 after a rate study of water and sewer charges were never implemented. Litzau said the city will conduct a new rate study after a new director of financial services is hired.

Noting how long it has been since rates were increased, Councilman Jon Quinn said he was surprised the council wasn't being asked to consider a larger increase. City Manager Alan Lanning said he prefers gradual price hikes.

"I think the rate study, once completed, is going to request further increases," Litzau added.

Also Tuesday, City Council received a semi-annual report from Pam Duckworth, chairwoman of the Historic Preservation Advisory Commission. Much of the discussion focused on a controversial moratorium on the demolition of historic structures imposed by the previous City Council in August. The moratorium was repealed by the current council in December.

One purpose of the moratorium was to prevent a rush on demolition permits while the city revises, and possibly strengthens, its historic preservation policies. Councilwoman Cari Hermacinski, who first requested the moratorium repeal, said there have been no new requests for demolition permits since the repeal.

It was noted that, if nothing else, the moratorium brought attention and interest to historic preservation. Duckworth was encouraged to take advantage of that with educational programs that might be better received now than in the past.

"Until you have something controversial, it's hard to get people to focus on it," Duckworth said. "Since the moratorium, we've gotten lots of attention."