Steamboat Springs City Council approves water rate hike

New rates set for Jan. 1; council OKs $21M base area refinancing

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— City officials addressed two significant financial issues Tues­day night, approving a refinancing package of up to $21 million for base area redevelopment and also giving the final nod to water and wastewater rate increases for city customers next year.

Steamboat Springs City Council expressed support in August for the refinancing package authorizing as much as $21 million. Deb Hinsvark, the city’s interim finance director, presented the final documents Tuesday for the Steamboat Springs Re­­development Authority’s — effectively the City Council’s — sale of fixed-rate municipal bonds that would be paid off with tax revenues at the base of Steamboat Ski Area and backed by the city’s “moral obligation.” That means if base area revenues do not meet the debt requirements, the city would have to pay the difference out of its general fund reserves.

The bonds will pay off the city’s current $17.5 million base area loan and enable completion next summer of base area work that includes a public promenade, the daylighting of Burgess Creek, public walkway improvements and underground utility upgrades.

“This is the whole ball of wax,” Hinsvark said.

City Council approved the refinancing in a 6-1 vote, with Councilman Walter Magill opposing.

Later Tuesday night, City Council unanimously approved water and wastewater rate increases that, along with increased tap fees for new construction, will extend through 2013 and help fund as much as $70 million of water and wastewater improvement projects facing the city.

Red Oak Consulting, a division of the national environmental engineering firm Malcolm Pirnie, recommended the rate increases after its assessment of Steamboat’s infrastructure needs and costs.

Red Oak’s report states the typical residential water bill — for a single-family home that uses 7,000 gallons of water per month — would increase 14 percent in 2011, from the current $28.43 to $32.42. Monthly wastewater rates would increase 8.8 percent in 2011, the report states, from the current $26.88 to $29.25.

The new rates will take effect Jan. 1. City officials will update rates and infrastructure costs in 2013.

Also Tuesday, City Council debated whether to pay nearly $11,000 for a survey of residents about their vote in the referendum on Steamboat 700, a proposed annexation that city voters strongly rejected in March. The Northwest Colorado Council of Governments submitted a proposal to conduct the survey.

City Council members and citizens were divided about the issue, with some saying it could be a valuable tool to gauge future growth proposals and others doubting whether such a survey would provide any cohesive information. City Council agreed to address the issue in the context of the city’s 2011 budget, which is the subject of a daylong meeting Oct. 5 in Centennial Hall.

— To reach Mike Lawrence, call 871-4233 or e-mail mlawrence@steamboatpilot.com

Comments

gas4765 3 years, 7 months ago

It looks to me the developers made their money at the expense of the citizens of Steamboat.. The rich look after them selfs on the council .

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John Fielding 3 years, 7 months ago

. Historically water rate structures have allowed average households to be subsidized by including a few thousand gallons in the base rate, then charging progressively higher rates for additional usage. While it is well intentioned as a means to reduce waste and help the poor, the effect is mixed. Under such a structure, a single person household like a poor old widow would likely pay more per gallon for their water, as would a home with a half dozen kids and a couple of in-laws living at home.

It also has the effect of discouraging cultivation of green spaces. I used to maintain a large flower bed in the right of way planter strip between my property and the street for the enjoyment of the neighborhood, but the cost of water was a significant factor in my decision to discontinue that feature. I also let my lawn get a little brown and patchy despite the fact that many children play on it. I watch the calendar closely, as I may pay much more for water on the 30th than the first of the month. I worry that the meter reading might be a day later than last month, so I don't always know how much water costs on a given day.

Every other utility charges for their service under a structure based on the actual cost. In many cases the cost of service is lower per unit delivered for large volume users, the reverse of a penalty rate. You pay for tap fees based on the actual cost of bringing in the pipeline or wires to your location, and the plant and grid costs are included in usage costs.

I have not read the new rate structure, but if we still maintain subsidy and penalty rates we should correct that discrimination.

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ride4fun 3 years, 7 months ago

Unfortunate rates are rising without merging the water districts and eliminating the unnecessary, multiple bureaucracies and associated costs of two water district administrations. The argument of being underfunded looses credibility if they continue to propagate excess spending on administration.

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ride4fun 3 years, 7 months ago

Unfortunate rates are rising without merging the water districts and eliminating the unnecessary multiple bureaucracies and associated costs of two water district administrations. The argument of being underfunded looses credibility if they continue to propagate excess spending on administration.

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Scott Wedel 3 years, 7 months ago

John, Water rates are typically based upon a fixed base charge that is justified as supporting the cost of creating and maintaining the water system so that water if available even if the person uses very little and usage charges that encourages conservation and reflects the costs of using more water. The costs of additional water usage is not just the cost of filtering more water, but the costs of acquiring water rights and needing a larger water plant and so on.

The fixed base is not for helping poor people. The plan that would be most beneficial to someone in poverty would be to be charged purely upon usage so the family could use minimal water and minimize their water bill.

Charging for usage does discourage watering to maintain green areas. Outside watering is generally not considered a public benefit. That is normally considered to be of benefit only to the property owner. It is generally considered far more important for people NOT to water in order to have green spaces. That it is much better if plants are chosen that are natural to the area that can survive on rainfall with minimal additional watering.

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John Fielding 3 years, 7 months ago

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Scott, the point you make about the rate structure is an excellent case for the ownership of the water system to be removed from governmental hands and instead given to consumer shareholders as with Yampa Valley Electric or a publicly traded corporation such as Atmos Energy. Each of these utility companies manage to operate very well without including the first portion of the product in the fixed base charge, a progressive schedule of penalty rates to discourage consumption, or tap fees that are more than simply the cost of extending the line to your property. The regulatory authorities would probably prohibit other practices such as municipal entities engage in.

If you consider that maintaining green areas is not a public benefit, you will do well to contemplate what this town would be like without the trees that needed continued care for years to survive till they could get roots deep enough. Even mature trees in this area can die from trying to survive on rainfall alone if there is little groundwater, such as in most areas above the valley floor but below the mountainsides.

Speaking of green spaces, does anyone know if our Parks Dept. has irrigation wells and river water sources for maintaining our parks? I have seen the pump station at Howelsen Hill, but I think it is just for snow-making. I was told by a Water Dept official that the City pays the same rates as other customers, but that would be the commercial rate, starts a little higher but never increases based on usage. As far as I know it is only residential users who are penalized for having large households and green spaces.

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Scott Wedel 3 years, 7 months ago

John, Well, isn't Mt Werner not owned by the City?

I said that water districts do not consider maintaining green areas is important. Thus not something they should support by subsidizing water rates.

Typically, it is cheaper and easier to water parks with treated water. Otherwise, they need a separate set of water pipes, it actually costs little to treat the additional water, and park watering is an optional service that can be shut off if there is a water shortage. So park watering doesn't really count when sizing the plant and so on.

Note that water rights does not mean that a park or such automatically has a legal right to drill a well for watering.

The amount of additional water required for a larger family should require only another couple of dollars a month per person. That is hardly punitive.

It is quite possible to have a larger yard that does not need that much water. Some plants require a lot of water in this climate, others not so much. There are no local laws requiring water intensive landscaping so someone owning a larger lot is not being forced to pay for lots of water.

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John Fielding 3 years, 7 months ago

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Scott, the cost of irrigation water is a tiny fraction of city water. Water rights can be purchased quite reasonably around here. Parks that are right next to rivers can easily have their supply changed. The infrastructure cost will be recovered in savings very shortly if you consider it as a fraction of the life expectancy of a park. I would be surprised if we are not using river water already.

If you use water wisely, you should not be penalized for using a lot of it. Why do we have different rates for different users if someone is not being subsidized?

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Scott Wedel 3 years, 7 months ago

John, Almost by definition, if you are using water wisely then you are not using a lot of it.

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