Citizens oppose water rate hikes
By Tamie Meck
Published Thursday, November 12, 2015 9:20 am
Photo by Tamie Meck The Paonia Public Works department crew works on a water main break on Third Street early Sunday morning. More than 80 recent breaks highlight the trouble the town is facing with its aging system. Rate increases, the subject of a speci
Of the more than 60 water users who packed Paonia Town Hall Nov. 5, only about 10 percent were in-town residents. They all came to let the town know they are not happy with recently-proposed water rate increases.
The roughly 20 citizens who spoke expressed concern over the size and percentage of the increases, which some said are unaffordable and will hurt families, the elderly and those on fixed incomes. They also expressed concern over a lack of fairness, since the greatest impact will be on out-of-town users and private water companies.
Trustee Ross King, who sits on the town finance committee, prefaced the meeting by stating that the increases were recommended to town manager Jane Berry by the board of trustees to satisfy the needs of the proposed 2016 budget. The town identified three major components of that budget that need to be addressed: completion of state-mandated filtration upgrades; a reduction in staffing; and updating of the town's codes and ordinances. "Mrs. Berry, at our direction, prepared this budget, and these proposed ordinances to satisfy the needs of the budget," said King. "I wanted everyone to understand this is not Mrs. Berry's idea. This is the board's direction."
The special meeting, called to address town water, sewer and trash ordinances, marks the first such discussion for both the public and the board, said Berry. More meetings and workshops are scheduled over the next four to six weeks, during which citizens have more opportunities for public input.
Proposed increases mark the second water rate increase since 2005. To address debt obligations of more than $3 million, payable to the Colorado Water Resources and Power Development Authority and associated with more than $5 million in state-mandated filtration upgrades, the town imposed an across-the-board $5 per month increase in May, 2014. That generates $90,000 annually, and leaves an annual shortfall of $107,000. Payments will average $175,000 over the next 20 years, and are now at $197,000 annually. That debt obligation alone represents $10.56 per account per month, said Berry.
The loan is just one cost the town faces. The system is aging, as highlighted by this year's spate of water main breaks, which have affected mostly out-of-town users. In addressing the breaks, comments toward the Public Works Department were considerate, and even commendable. Rene Atchley thanked department head Travis Loberg and his staff for their round-the-clock efforts to keep up with the breaks.
Berry explained that Paonia's system is unique in that it has two separate plants fed by more than 20 miles of water line delivering spring water to the plants. The gravity-fed system currently services 1,005 in-town and 490 via a system that, in some places, is 80-plus years old. With no lift stations, the system literally pushes water uphill in some areas. In addition, some 60 out-of-town homes are waiting to tap into the system. Because of its unique structure, it's hard to compare Paonia's rates to towns of similar size, said Berry, but current rates fall slightly below state averages.
The understanding that rates need to rise and repairs are desperately needed was a common theme expressed by citizens. Lamborn Mesa resident and former town attorney Jim Briscoe said that solving the problem will take a community. "We need to come together and solve that problem, and I think that if we work together and treat each other fairly and ... reasonably, I think we'll get it done and we'll be friends and we'll solve the next problem together."
Briscoe and Lamborn Mesa resident Ed Marston suggested the town impose another $5 across-the-board increase. Marston, also an in-town business owner, said that would come close to meeting loan service requirements and give the town time to complete a thorough water rate study. He suggested the town then follow the recommendations of the study. Marston commended the town and current board for trying to deal with problems that have been swept under the rug year after year. "It's up to you to figure out how to deal with it without going to extremes," said Marston.
Business owners also spoke out. Ron Rowell, owner of Paonia Cleaners & Laundry, expressed concern over doubling of business rates. Rowell said this is a problem Paonia has dealt with for more than 65 years. Once work is completed on the 1 million-gallon system and it's back on-line, the system will settle down, said Rowell. That will give the town time for a water rate study and a way to try to look at options to trying to solve everything at once. He also said his business uses about 60,000 gallons per month, and that current and proposed increases in incremental rates are hurting his business, and are especially hard on the Paonia Care Center. "You're going to kill them, and we don't want to lose that place."
Citizens also asked if the board if it has researched all possible funding sources and options before deciding on these increases. Dry Gulch resident Jack Young suggested the town seek a way to gradually increase fees to minimize impacts. "How can we do it $2 this year, $2 next year and so on?" said Young, adding that today's customers are being asked to pay for past mistakes and future costs.
Water company members and representatives also spoke against a proposed $100 monthly administrative fee. Berry said they are subject to negotiation and that the town is in the process of meeting with representatives to discuss options.
Water company member Kerri Minerich noted that most companies already service their own lines and bill their members, and suggested that should offset any proposed administrative fees. "Don't kill us," said Minerich. "We can't afford it."
Lamborn Mesa resident Jeff Wobig owns one of two houses served by the Lamborn School water company. Wobig's family has been without water for upwards of 10 days at a time, and their basement was flooded due to blown water heater pressure valves. He said the two residences will see an increase of $90, none of which will go toward water usage. "That doesn't make any sense to me at all..." said Wobig. He said he doesn't mind a small increase, "but I'm not about to pay $90 before I get a trickle of water."
The town is looking at funding options, including liquidation of $100,000 in assets to go toward water fund revenues, per the 2016 draft budget, although sales are uncertain, noted mayor pro tem Charles Stewart, also a member of the finance committee.
The draft budget also estimates $191,000 in water tap fees, which are based on proposed new construction projects, said Berry.
Nine water upgrade projects are proposed for 2016, to be funded by the $3 million in grant money remaining from this year's upgrades. The original plans called for construction of two additional storage tanks, and the state approved the money going toward infrastructure upgrades. To bring the system up to where it should be is estimated in the millions of dollars.
Sewer and trash ordinances will be discussed at one of the upcoming budget workshop meetings. The town is looking at increases of those rates, although not on the same level as the water rates, said Berry. The town is also looking into contracting out trash services.
After the meeting King expressed disappointed that it was adjourned prior to the board having an opportunity to provide Berry with feedback, leaving her with no collective direction. Time is running out on approval of the 2016 budget, and that hinges on the ability to pass several revenue items, including rate changes, said King.
He also said he was pleased with the variety of viewpoints offered and that, considering the seriousness of the issue, the meeting was both civil and productive. He added that he looks forward to completion of a water rate study and its recommendations."I believe the majority of the speakers understood the necessity of the town addressing the issue," said King. "It's painful, but something has to be done."