Sacramento should limit rate hike pain, but speed water meter installation

A construction crew replaces a water main in Land Park in November 2014.
A construction crew replaces a water main in Land Park in November 2014. Sacramento Bee file

Sacramento City Hall is putting on a hard sell for another round of water- and sewer-rate increases, two years after the last one. Officials have some more convincing to do to justify the entire rate hike.

The city’s Utilities Rate Advisory Commission, which held a public hearing Wednesday night, was right to delay its recommendation and urge utility officials to see whether lower rate increases are possible.

The four years of proposed hikes – 10 percent on water bills and 9 percent for sewer – would raise the average residential customer’s bill from $68.15 a month now to $98.60 in 2019. While it’s the price for decades of not investing enough in infrastructure, that would be a big burden in many household budgets.

The higher rates would finance $265.5 million in water projects and $53.5 million in sewer projects by 2020. The city plans to install 42,600 water meters and replace 76 miles of related pipes, and rehab four miles of sewer pipes and 10 pump stations, among other projects.

By far the biggest expense is $230 million to finish installing water meters in 2020, four years ahead of a state deadline. The advisory commission asked how much lower rate hikes would be with a slower schedule.

The city should stand firm on water meters. They encourage conservation and will mean fairer billing since unmetered customers are paying a flat rate no matter how much they use, as Utilities Director Bill Busath and City Manager John Shirey told The Bee’s editorial board on Thursday.

There are other, though smaller, places to look for savings. Officials need to wring out repairs and upgrades that aren’t urgently needed to protect public health or meet state and federal regulations. For instance, there could be some wiggle room in $14 million for customer billing and other IT upgrades and $12 million for security and emergency preparedness. Busath and Shirey were less persuasive that all those projects are absolutely necessary right now.

While paring those line items wouldn’t reduce the rate hikes significantly, every little bit helps.

These proposed increases come on top of three years of double-digit water and sewer hikes that started in 2012 and added $19 a month to the average bill by July 2014. The utilities department says it did what was promised with that money and more – upgrading the century-old Sacramento River Water Treatment Plant, installing 21,000 meters, rehabbing 29 groundwater wells and modernizing sewer lines in Oak Park and along Seventh Street.

That track record is reassuring. But as the public hearing made clear, there’s still distrust of the department.

And the city must recognize the piling on of recent rate hikes for basic city services – not just water and sewer but also for wastewater, garbage pickup and recycling. If these new increases go through as proposed, the average homeowner’s monthly bill will rise to $181 in 2020, from roughly $150 today and $115 in 2012.

That bill could get even higher if storm drainage rate hikes are approved. The city put off a planned vote this year until at least 2017. That makes sense, in part to avoid conflict with a planned ballot measure for flood protection and also to work on plans to reuse stormwater and not let it go to waste.

The advisory commission plans to debate water and sewer rates again Feb. 10 and is expected to make its recommendation to the City Council in March. If approved, the rate increases would start July 1.

The city is committed to helping more homeowners who are least able to afford higher rates. About 1,600 customers are signed up for a program that saves them as much as $13 a month, but about 17,000 are thought to be eligible.

That’s great for the neediest, but all homeowners are feeling the pinch of repeated rate hikes. The city needs to do what it can to ease their pain as well.