Clovis residents could see a jump of more than 50% in the cost of residential sewer service beginning later this year.
The reason: The city built sewage treatment facilities for thousands of new homes that didn't get built. Now, existing residents must shoulder the higher costs until development picks up again.
Clovis City Council members discussed sewer service rate increases Monday night that would include an 8% hike and $7.30 monthly surcharge beginning in August.
Residential customers now pay $14.62 per month. With the surcharge and rate increase, the monthly cost of service could rise to $23.09 in August. By July 2014, sewer service could cost $28.14, under the staff recommendation.
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The rate increases -- up for approval in June -- would cover operation costs and debt related to construction of the city's sewage treatment and water recycling plant on Ashlan and Thompson avenues. The rate increase also would pay for upgrades at the Fresno regional sewage treatment plant, in which the city has about an 11% ownership.
When the plant at Ashlan Avenue was built, the city was permitting more than 1,000 homes a year with no slowdown in sight. The city set up a $10 million rate-stabilization fund to help defray costs if development dropped below 750 homes per year.
But in the wake of the housing collapse, Clovis is issuing just 200 new housing permits a year. As a result, officials said, the city has eaten through its rate stabilization fund and needs more money to cover the treatment plant's debts and operating costs.
The $7.30 monthly surcharge would help pay off bonds for the sewage treatment plant. The additional rate increase, about $1.50 a month, would pay for the higher costs to operate the plant, said Mike Leonardo, the city's public works director.
Resident Dale Drozen said he did not like the surcharge because he paid his development fees when his home was built.
"It doesn't seem fair [that] you put the surcharge on me for future development," he said.
Mayor Harry Armstrong said he prefers a surcharge to a rate increase because the council can reduce or eliminate the surcharge if development increases.
Council Member Lynne Ashbeck said she doesn't like the increase but sees no way around it.
"We will default on our bonds if we don't do it," she said.
The last increase in sewer rates was about 10 years ago, said Lisa Koehn, the city's assistant public utilities director.