Asheville Council OKs water rate increase despite 'greater burden' on residential users

ASHEVILLE - Despite earlier talks of delays, Asheville water rates are going up.

City Council approved the fee increase April 25, estimated to impact the average household at about $7.13 a month or $42.78 a year.

Without the increase, staff said, it would be "challenging" to maintain the city's current level of service and more revenue is "necessary" to address capital needs. The water department asks come after a holiday water outage crisis triggered, in part, by equipment failures, cold temperatures and numerous line breaks.

“We think it is going to be very difficult to maintain our current level of service without the staff recommended fee increases," said budget manager Taylor Floyd.

Council members and residents have noted that the current rate structure presents an imbalance for residential customers versus commercial users, with the latter getting breaks for greater usage, and facing lower rates than those of single family residential.

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It's what Andrew Fletcher, a longtime Asheville resident, called a "broken system," with residents paying "more than their fair share."

“We love to think of ourselves as an environmental city that champions conservation and this is a dinosaur rate system, and it’s clearly not working," Fletcher said.

Staff encouraged council to wait on any other changes or rate halts — citing an incoming report from the water outage independent review committee, a third-party, nine-person body responsible for analyzing the circumstances that led to the outages, and a separate rate model study anticipated for completion in the fall.

Once that information was in hand, they anticipated having more "specific technical expertise" to consider substantive rate structure tweaks. Floyd said council did not have to wait until next fiscal year to make changes — and could adjust fees mid-year, if they chose.

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What was the vote?

The vote to establish the higher base and consumption fees for water, plus an increase in hydrant meter rental deposits, passed in a 5-2 vote, with council members Sage Turner and Kim Roney opposing.

A second motion, by council member Maggie Ullman, to direct City Manager Debra Campbell to bring a proposal back to council after the rate study is complete, with plans to update the rate structure beginning Jan. 1, was adopted unanimously.

Ullman said she would like to see the rate structure shift to incentivize water conservation, with a "fair balance" between different users, naming a "substantial burden" for current residential customers. At the same time, she said, she was uncomfortable "not doubling down on our water infrastructure," and said maintenance and capital projects can't wait.

Roney said her "no" vote came due to a fundamental opposition of the "bulk discount" experienced by commercial customers, and said this is the second year she's asked why one is offered.

"I’m not sure if ‘hurry up and move ahead’ will result in what we want, which is change," Roney said.

Turner expressed concerns regarding a $500,000 "contingency" built into the revenue expected to be generated by the increase.

“I’m just sensitive to rising costs for the residents right now, especially after the conversation of potentially wanting to freeze it, and reversing out that,” Turner said.

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Incoming rate model study

The incoming study will:

• Define cost of service by functional area (such as production, distribution).

• Assess rate structure and make recommendations for an "equitable and functional" rate model.

• Incorporate changes into updated financial planning model.

“I think (Campbell) is hearing this council that we have concern about the structure of our system placing a greater burden on the residential user and how to reallocate that more equitably," said Mayor Esther Manheimer.

Of Asheville water system's 60,700 customers, 53,528 are single-family residential customers who are billed for about 2.9 million CCF of the system's total of 7.7 million, or 37.5%. The next highest is commercial customers using 33.4%.

Fee increases will become effective July 1. Increases to solid waste and stormwater fees were approve by City Council at its March 28 meeting.

Sarah Honosky is the city government reporter for the Asheville Citizen Times, part of the USA TODAY Network. News Tips? Email shonosky@citizentimes.com or message on Twitter at @slhonosky. Please support local, daily journalism with a subscription to the Citizen Times.

This article originally appeared on Asheville Citizen Times: Asheville Council OKs water fee increase; How much? What was the vote?