By Philip Haldiman, Independent Newsmedia

Peoria residents will see a small increase in their water rates if the proposed fiscal year 2018 budget is approved.

Management and Budget Director Katie Gregory said the city does an analysis of water rates every two years, finding the need for a 2.25 percent combined water and wastewater rate increase, amounting to about a $1.50 increase for the average Peoria  household for fiscal years 2018 and 2019.

The budget also recommends a 3.9 percent solid waste rate increase for fiscal year 2018, a 50-cent increase for the average residential bill.

A public meeting and a Council vote on the proposed rate increase  is set for May 16.

Peoria has the third lowest residential utility rates in the region and the lowest in the West Valley, according to city officials. If the rate increase is approved, Peoria would still have the lowest water rates in the West Valley.

City Manager Carl Swenson said the increases are largely due to expansion.

Utility funds will go to repair and maintenance projects, well rehab and quality improvements, as well as expansion to the Pyramid Peak waste water treatment plant operating impacts and maintenance.

Mr. Swenson said the city has done a good job at holding down water rates.
“I attribute this to the leadership of the Council and the hard work of our staff.

We make sure we provide value to our rate payers, and keeping them low is important to the Council, who has been really good about the principles of sound financial management,” Mr. Swenson said. “In other words, money collected from water stays in those funds, making sure we have fund integrity.”

The city expects four water plants to expand in the next 10 years. Additionally, Ms. Gregory said costs are going up for Central Arizona Project water, which supplies about 40 percent of city’s overall demand for water.

“That is a pretty significant piece when you think of all  the sources of water we have,” Ms. Gregory said.

The fixed CAP water allocation rate will increase almost 50 percent over this year and next. The variable delivery rate, or the money the city actually receives is also expected to increase in the coming years.

These two components make up the CAP rate.  The fixed component of the rate comprises the capital charges and is based on Peoria’s allocation of water. The second, larger variable delivery component is based on the city’s annual deliveries for water to address growth in usage and to replenish groundwater supplies.

CAP is basing the variable component’s growth on future drought, Ms. Gregory said.

“We estimate that the costs for this component will increase by approximately $400,000 based on CAP’s current rate forecast, which assumes first stage drought conditions beginning in 2019,” she said. “This component will continue to grow over the next three to four years.”

Solid waste rates will increase because of inflationary pressures on operations and maintenance, expected landfill rate increases and lower revenue from decreased recycling rates.

“The decrease in the recycling revenues is due to declining demand for recycled materials, therefore, the revenues we receive for recyclable materials is going down,” she said.

Additionally, the Department of Public Works added a new position last year and the proposed budget calls for three new positions for fiscal year 2018.

Ms. Gregory said solid waste has not had a rate increase in five years, and in 2012 there was actually a decrease.

“We’ve been holding steady for the last five years,” she said.

If you go
What: Public meeting and council vote on proposed water rate increases
When: May 16
Where: Peoria City Council chambers 8401 W. Monroe St.
More info: peoriaaz.gov

 

Philip Haldiman can be reached at 623-876-3697 or phaldiman@newszap.com.