Water rate hike nixed
In a unanimous 5-0 vote that surprised some city staff, the Sonoma City Council rejected a five-year, 5-percent-a-year water rate hike and said they wanted more information before reconsidering the request.
All five council members expressed concern about the impact a rate increase would have on consumers, and Mayor Joanne Sanders asked whether the city’s water department couldn’t simply be consolidated with the Valley of the Moon Water District. “We are really all one community down here,” she said.
In a detailed PowerPoint presentation, Public Works Director Milenka Bates explained the many steps leading up to the rate increase request, which was part of a set of recommendations presented to the city by consultant John Olaf Nelson, head of the firm Water Resources Management.
Nelson was hired by the city in 2009 to prepare a water rate and connection fee study, which he presented to the City Council in September 2010. That study outlined in painstaking detail the best strategies for meeting water demand projections, the city’s water system capital improvement needs, as well as recommendations for increased user rates between 2013 and 2017. It formed the basis for the water department’s 5-percent-a-year requested rate increase, and was designed to cover the cost of capital improvements needed to provide the city with adequate water supplies in critically dry years.
Part of the demand projection was based on the fact that the Sonoma County Water Agency abruptly abandoned a planned increase in water withdrawals from the Russian River/Dry Creek/Lake Sonoma system after a federal biological opinion forced a reduction in stream flows from Warm Springs Dam.
This complicated equation got virtually no attention from the City Council, however, which was more concerned about objections raised by a parade of 11 members of the public, all but one of whom rose to speak in opposition to any rate increase.
Prominent among them was city resident Jerry Simmel who argued that best management practices dictate not more than 30 percent of utility charges should be fixed, as opposed to volume of use – a formula he said Sonoma’s water rates exceed. He also complained that smaller households, like his, that use less water, are charged excessively.
Hal Nichol, who lives outside city limits but is a city water customer, complained that, “I don’t know who has been able to give a 5 percent annual raise to their employees.” Nichol suggested a rate moratorium be imposed until a more equitable increase could be figured out.
According to the rate structure Nelson proposed in his study, the typical single-family customer would see an annual increase of $193.34 in the first year, rising to an increase of $235 in the fifth year. That amounts to an average bi-monthly increase of about $35 over the five-year period.
The only public speaker to support the rate increase was Ed Kenny, an elected member of the Valley of the Moon Water District board, who told opponents, “Stop moanin.’ How often do you walk into a gin mill and buy your neighbor a drink. You pay five bucks, you just threw away a thousand gallons of water.”
But since the purchase of water represents only 30 percent of the typical water bill, City Council members expressed concern about the fixed costs in the equation, and were further concerned that Sonoma’s fixed cost rates are the third highest in the county, although four municipalities have higher volume rates.
In the end, council members expressed a strong interest in exploring other alternatives before considering the rate increase. Those included, as Councilmember Tom Rouse suggested, “initiating a conversation with the Valley of the Moon Water District, or even countywide users,” about consolidating water distribution functions.
Other questions included exploring how much groundwater other cities pump to put Sonoma’s water costs into better context.
Sonoma currently gets about 95 percent of its water from the Sonoma County Water Agency, via the Russian River delivery system.
Councilmember Steve Barbose summed up the council sentiment, saying, “I think we’re moving too fast. I want to examine the allocation of fixed cost versus use cost. It may not be fair. (And) why are Petaluma and Windsor so much cheaper.”
In denying the rate increase, the council did not specify when it would revisit the issue.
The consequence of a delay? Public Works DirectorBates, who later expressed some surprise at the council’s response, said that maintenance and new well construction would be deferred, which often means the cost will get higher as time passes.