Sewer Rate Increase Inches Closer to Reality

The City Council Tuesday night approved a 50 percent sewer rate increase and began the Proposition 218 process — the state law that ultimately will put the decision of a fee increase in citizens' hands.

A single-family home will likely see rates jump to $58.65 by January, from $37.58 today. An additional 3 percent increase is also proposed for the following three years. 

Passed in 1996, Prop. 218 works like this: After the City Council OK’s the rate increase, a public hearing notice will be sent out to Rohnert Park sewer account holders — the people who pay bills here. Then, the public has 45 days to submit to the city a written protest against the rate increase, if so desired.

After 45 days, the Council will hold a public hearing. If the majority of citizens agree with the increase, or do nothing, then it will go into effect. About 8,350 current account holders get to weigh in, according to a report by Bob Reed, the Sacramento-based rate analyst. 

If the majority of ratepayers reject the increase, then “we’re in a whole new world,” said Sandy Lipitz, the city’s finance director. “We have obligations we have to pay.”

“If we do not successfully increase these rates, the health and welfare of our citizens will be at risk, or we will undue all the good we’re doing with Measure E,” said John Dunn, the interim assistant city manager. “Our sewer fund, very simply, is running out of money.”

“We are therefore at risk of our sewer fund becoming a drain on the city’s general fund," Dunn added. "That could cost ratepayers more over time and can result in even more costly repair and fines or intervention by regional, federal and state entities."

Rate Breakdown

The city currently has about $4 million in reserves, according to the report. Dunn said those reserves will be depleted by 2012. Measure L, a voter-approved ballot measure, — about 30 percent.

Under the proposed increase, residents would be expected to generate $12.9 million in 2011, 13.6 million in 2012,  $14 million in 2013 and $15 million in 2014, according to the report.

Current rates generate about 7.3 million a year, Reed said.

“When we look at the future of the fund, our financial priorities are ongoing operating and maintenance expenses, debt service obligation, capital replacement and rehabilitation and [33 percent sewer] reserves,” Reed said.

The debt service obligation was issued by the city in 2005 to construct a pipeline from Rohnert Park to Santa Rosa at the cost of about $13 million. The city still owes $11.5 million.

“The original pipeline constructed in 1976 was too small to meet the needs of existing users,” said Darrin Jenkins, head city engineer. “As a result, Rohnert Park had stored raw sewage in unlined earthen ponds near the old Crushers Stadium. This practice was no longer acceptable due to regulatory conditions.”

In For a Fight

The city asserts that the rate increase will not fund future development. But, John Hudson, who was instrumental in getting Measure L passed, doesn’t agree.

“I know that existing residents are forced to provide infrastructure for developers … there is simply no way to finance it under present law,” he said. “Obviously, the sewer system must be in place before a building permit can be issued. Somebody has to finance the construction of the sewer infrastructure before the building permit can be issued.”

“That somebody is we,” Hudson added.

Hudson cited one city ordinance that stated “the city shall establish ... sewer service charges ... so that the total revenue from such charges is equal to the total cost of operating, maintaining and expanding the city sewer system.”

And another, that says “it is the policy of the city that the city sewerage system be operated as a self-supporting utility and that service charges for its use be calcucated and changed from time to … to provide for the expansion of the system to meet the needs of all users …”

The proposed sewer rate proposal, if passed, would create a new city ordinance.

"There’s no money in the five year rate plan that will be used for expansion related development projects," Reed said.