Fees for government services rarely drop, but this year it could happen in Clovis.
Coming on the heels of April’s approved water rate increase for the city’s most conservative water users, the city is proposing a nearly 40 percent cut in its sewer rate.
The city’s proposed budget would eliminate a monthly sewer surcharge of $7.30 starting with the July billing cycle. In addition, the city will begin repaying residents for money that the city had borrowed to help pay for a new city plant, at a rate of $3.65 per month.
On utility bills, which are sent to residents every two months, customers will see a reduction of $21.90. The average rate today is $57.66 every two months. The reduced rate of $35.76 will be in effect for one year. Each year, the council will decide whether to continue it.
The rate reduction will require City Council approval in June during budget hearings.
The city added the surcharge in 2010 after the housing market soured. It had just built the sewage treatment and water recycling facility near Thompson and Ashlan avenues and had to pay down the debt. The debt repayment relied on an average of 750 to 800 new housing units annually, which seemed reasonable when the council arranged the debt repayment plan more than a decade ago, when more than 1,500 homes were built yearly.
When the housing bubble burst, the number of new homes fell to fewer than 250 some years. City officials used the surcharge as a buffer for its debt repayment.
“We didn’t have enough developer fees to cover the debt,” said City Manager Robert Woolley. “Now, with construction being up, it’s giving us the ability to do this.”
The only city utility rates that will rise for all city residents beginning in July are green waste and recycling collection. Green waste will rise 20 cents per month, to $5.14, and recycling will jump 13 cents per month, to $3.50.
Water rates will rise for some. City officials were criticized in April for raising water rates on the city’s most conservative users. Many customers’ water bills will remain similar; those who use the most water will likely see lower rates and those using the least water will get billed more.
The new rates were necessary because of a legal ruling last year that said certain tiered rate systems are illegal. Clovis changed its rates, even though its model wasn’t challenged.
The court ruling was based on Proposition 218, which says that government can charge a fee only to cover the cost of that service. Those using more water in San Juan Capistrano sued, alleging the city’s conservation efforts – charging lower water rates to those who use less – were unconstitutional. Courts sided with them.
Users paying significantly higher rates because they used more water claimed that the difference in rates was not justified by the costs to the city.
The lawsuit’s outcome led cities to examine their tiered-rate systems, including Clovis. The city hired a consulting firm that suggested ways for the city to change its billing system and avoid a legal challenge.
While many opposed changes to the rate system, others were opposed to a 3 percent annual rate hike.
The city will not incorporate the 3 percent hike into the new year’s billing, said Luke Serpa, the city’s public utilities director.
But the city hasn’t determined whether it will charge the higher drought rate or lower normal rate. The state Water Board will review the city’s plans for the coming year and inform city officials in June whether it has enough supplies to avoid using the drought rate, Serpa said.
Currently, someone who uses up to 10,000 gallons every two months pays the base rate of $16.80. But under the new system, the base rate is set at $21.22, and conservative consumers also will pay 86 cents per thousand gallons, raising the bimonthly bill to $29.82, a 78 percent increase. If a drought is declared, the city’s rates rise to $1.04 per 1,000 gallons.
Residents using the average amount, about 27,000 gallons, will see little price change under normal circumstances. Under drought conditions, they will pay about 10 percent more.
Clovis will collect about the same amount of money next fiscal year under the new water rate structure as it expects to this year, Serpa said.
Overall, utility bills – which include trash, green waste, recycling, street sweeping, water and sewer – for average water users will drop from $170.09 to $149.78. Under a drought billing program, the average utility bill will be $156.52, according to the city’s proposed budget.