City hears request for one water rate

The new rates result in the two water hauling businesses being charged $9.18 per 1,000 gallons of water. The previous “in-town” rate which water haulers were charged was $6.20 per 1,000 gallons.

City officials have said, and city Attorney Steve Shermoen pointed out Monday, that the haulers are passing on to their customers a charge that is over and above the new city charge to haulers.

Shermoen pointed to a Dec. 26 water bill charged by North Country Water that showed a charge of $34.75 for 1,150 gallons of water. On Jan. 2, the bill was $51 for 1,150 gallons of water at the same residence.

He said the city’s rate increase only accounts for $4 of the water hauler’s charge and asked how the additional increase resulted.

“What you have passed onto the customers is not even comparable to what the city has passed onto to you,” Shermoen said. “You added 40 percent onto the bill.”

But Brian Horne, owner of North Country, said he anticipated the rate increase and held off from increasing rates earlier to his customers until the city’s rate increase. He now charges 3-cents per gallon, instead of 1.5-cents per gallon, and has decreased some of his “drop charge.” He also said the price is based on where the water is delivered.

But for many at the meeting, including Horne, at issue is charging the water haulers an out-of-town rate when they purchase water from the city and their tanks are filled within city limits.

“I am not blaming the city for the bill, I am blaming the city for the unfairness,” said Horne.

But Shermoen said that when haulers talk about a “fairness issue” they need to look in the mirror. “It appears there’s attempted gouging going on,” he said.

Later in the meeting, Charlotte Marble, bookkeeper for Don’s Water Service, said charging the hauling businesses more than the charge to other city businesses was unfair and insulting.

Don’s has provided service for more than 30 years and has attempted to keep the water affordable for residents, she said.

She grew emotional as she apologized to Don’s customers for the increase to its charges and said the business is looking at other options to decrease costs.

Marble said the business had to pass on the percentage increase from the city and more to cover taxes and other business costs.

“If you put us out of business, you’ll lose the sale of one million gallons per month,” she said.

Fairness

The issue of fairness was also raised by Commissioner Wade Pavleck, who said the city’s water treatment plant was constructed as a result of tax increment financing which captured all the increase in taxes from a 1989 Boise mill expansion.

He said the TIF mechanism did not allow county residents to benefit by the increased taxes, so they, in essence contributed to the construction of the water plant.

“I urge you to equalize the rates for everyone,” he said to the applause of the audience. “You would gain so much trust and credibility.”

But city officials said the expansion prompted Boise to end its sale of water to the city, leaving city and rural water customers without a source of water. The city used the TIF money to finance the water treatment plant, which benefits everyone, they said.

Board Chairman Brian McBride, who raised concerns at Monday’s meeting about the city’s rates, told The Journal Tuesday morning that he may ask the county board to invite representatives of the two water hauler businesses to a county board meeting to discuss the rates they charge to their customers.

Falls Mayor Shawn Mason said she welcomed the opportunity the meeting provided for city officials to hear concerns as well as educate the public about the city’s water rates.

Councilor Cynthia Jaksa, chairwoman of the committee, began Monday’s meeting by explaining that the rate increase, which resulted in a $2 monthly increase for the minimum in-town rate, was prompted by a shortfall in the water department budget and based on an earlier water usage study.

She said the city is not making enough money through the water department.

The reclassification of rates, she said, for the water haulers was based on: city residents baring the risk of shortfalls in operating the water plant; and that city residents purchase both a water and sewer package.

The study, she said, predicted an increase in water use, while in fact, less water is being used.

But some people said the increase to water haulers and the effect their charges have had on their customers could result in the city selling less water as rural customers consider purchasing their water from an in-town gas station and hauling it themselves to their residences as well as exploring other sources of water, including drilling wells.

Some people questioned the city’s management of its water department. Jack Valentine of Dove Island said it appears “someone was asleep at the wheel” in regard to the $500,000 shortfall in 2011 in the water budget.

He suggested that it would have been wiser for the city to raise its water rates by a few percent each year for the last few years rather than a large increase all at once.

Because of the rural water charges, Valentine said he would now purchase just half the water from haulers he previously bought and will use Rainy Lake water for dish washing and showering.

Commissioner Rob Ecklund said he knows of at least two customers of the water haulers that have said they will drill wells instead of purchasing their water.

“I concur on the fairness issue and agree with Steve Shermoen, but the city could lose a lot of customers,” he said.

Others at the meeting attested to the hardship caused by the increase in costs of having water hauled to their residence.

Greg Crow said the water haulers had to raise their rates to stay in business, while Chris Foss said the city needs more water users to help drive down fixed costs and encouraged the city to expand its waterlines.