Phoenix officials search for alternatives to proposed water rate hike - Ahwatukee Foothills News: News

Phoenix officials search for alternatives to proposed water rate hike

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Posted: Friday, January 21, 2011 11:00 am | Updated: 3:41 pm, Thu Feb 24, 2011.

The Phoenix Water Services Department does not intend to comply with a request from three City Council members to produce a list that prioritizes the department's personnel and projects from most to least important before raising city water rates by about $23 million.

"That list will not be forthcoming," said Ken Kroski, a water department spokesman.

The three council members are Sal DiCiccio, whose district includes Ahwatukee Foothills, Claude Mattox and Bill Gates. DiCiccio has accused Phoenix officials of shifting employees into the water department and then proposing to raise water rates on residents by 7 percent next year to cover the added expense. Instead of balancing the city's cash-strapped budget through cuts, officials are shifting the burden onto the public through the fee hikes, DiCiccio said.

"I think we ought to be cutting internally first," he said. "I want them to find $23 million to cut in the Water Department rather than put it onto the public. They've done a very poor job of cuts in that department."

Kroski, however, said the rate hikes are needed to cover capital improvement projects such as building reservoirs for fire protection and improved water pressure and replacing or fixing old water and sewer lines, to pay down debt, and to pay for unfunded federal mandates. For instance, the city needs $200 million to upgrade treatment plants to comply with Safe Drinking Water Act requirements and $15 million annually to operate enhanced filtration systems, he said.

"That's for the big budget items that do not come out of the operating budget," he said. "We are directed by the EPA to take action on things, but we're not funded. That cost gets passed on to the customers."

He said the department has taken a number of steps already to reduce costs, such as cutting 50 percent, or $358 million, in future sewer capital projects; cutting 30 percent, or $263 million, in proposed water system improvements originally planned for 2011 to 2016; lowering the department's proposed operating budget by 3 percent; eliminating 25 percent of management positions; reducing employee compensation and instituting unpaid furloughs. The water department has the right amount of people to handle its responsibilities, Kroski said.

"Phoenix water services is staffed appropriately to meet customer needs and public health and safety," he said.

DiCiccio said that by having the water department list its priorities and expenses, the City Council can make an informed decision about how to budget for it.

"It's not an unusual request," he said.

A City Council meeting on whether to go forward with the rate hike has been postponed until Feb. 23. Kroski said the time will be used to provide additional information to council members, while DiCiccio said he and others will try to rally the public against the proposal.

"We're sending out thousands of e-mails getting the public motivated. They're starting to question it themselves," DiCiccio said. "It gives us plenty of time to start organizing."

If approved, the new rate - which is expected to add an additional $2.21 each month to the typical single-family residential customer's bill of $56.25 - would take effect in March. The rate increase is expected to produce $22.9 million additional revenues in the first full year.

Next year's proposed 7 percent water rate increase is smaller than last year's 9 percent increase, officials have said. And wastewater rates, which went up 4.5 percent last year, are not expected to rise this year.

DiCiccio has said rising water rates hurt the elderly on fixed incomes and the poor, and could hurt local businesses, golf courses and homeowners associations by forcing them to cut back on usage.

"Your water rates, if they go up, will be devastating to your business," the councilman told a group of Ahwatukee Foothills Chamber of Commerce members during an event Wednesday morning at the Grace Inn off 51st Street and Elliot Road.

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