City raises sewer rates

Kalispell residents will begin paying more for the city sewer soon after the City Council decided to increase rates Monday night.

Council tweaked the proposed rates, which will delay their full impact somewhat. The adjusted rates were approved 8-1 with Bob Hafferman dissenting.

The increased rates are needed to pay off a $14 million upgrade to the city sewer after anticipated growth didn’t materialize.

 Instead of an immediate bimonthly increase from $3.75 to $15, council went with a $5.63 increase that customers will see beginning in May.

That will put the bimonthly base rate at $9.38 until fiscal year 2012. Then the rate will go up another $5.62 to $15. Customers will see that increase in September. The rate will be increased another $1.88 in fiscal year 2014 to $16.88.

A proposed increase in the volume charge from $4.19 per thousand gallons to $4.53 was changed to $4.78 but pushed back one year, from fiscal year 2012 to fiscal year 2013.

Council also passed increases in water and garbage rates, but those won’t go into effect for a while.

The bimonthly water base rate will increase from $3.75 to $9.38 beginning in fiscal year 2012. Fiscal year 2013 will see an increase to $15.

The volume charge per thousand gallons of water used will remain the same throughout the five-year plan.

Solid waste rates will increase 25 cents per month, which represents a $3 annual increase beginning in fiscal year 2012.

Hafferman suggested the city use $609,627 in impact fees from the Storm Sewer Fund to pay for the sewer. He said the storm sewer and sewer are linked. “It all works together because they infiltrate into the system,” he said.

City Manager Jane Howington said the city legally can’t put storm sewer impact money into the sewer fund unless it amends its ordinances.

Hafferman said the city adopted sewer studies previously that called for infrastructure improvements to be paid with impact fees. City Attorney Charlie Harball noted the sewer bonds require the city to pay them first with rates and then with impact fees.

City Finance Director Amy Robertson said the city is paying $1.347 million per year on the bond payments for the sewer system. “You can’t pay it all with impact fees. You have to use rates,” she said, because the city is not getting enough impact-fee money due to the downturn in the economy.

If the city doesn’t increase revenue, Robertson said it “could be out of operating cash in the Sewer Fund by June. It’s pretty critical, I think.”

Howington said the city’s sewer base rate in 1996 was “close to $15.” At that time, customers were allowed to use up to 6,000 gallons before usage charges went into effect.

Council member Randy Kenyon suggested increasing usage rates for big users when the council considers the issue again next year. “Make it conservation-based next time,” he said.

“What we have now is a conservation measure,” Hafferman said. “Some people are cutting back. Increasing the rate makes more conservation. Raising the administrative fee limits conservation.”

Council member Wayne Saverud said the city’s sewer rates “are approximately half of everyone else in Flathead County.”