by Priscilla M. Leith
Newton administration officials and aldermen have worked hard over the summer investigating options for revising the city’s water rates and laying out a strategic plan for much needed capital improvements to our stormwater system. Newton CFO Maureen Lemieux and DPW Commissioner David Turocy presented detail at October 1 and November 5 meetings of the aldermanic Public Facilities Committee. (For an informative introduction to these topics, see Water Underground, an article by Ald. Deb Crossley in the fall 2014 issue of the Newton Conservators Newsletter.)
Newton has separate accounts called Enterprise Funds from which the city pays the Mass Water Resources Authority (MWRA) for fresh water and sewer service, as well as the cost of the city’s internal stormwater system, which diverts street runoff into local rivers, streams and Crystal Lake. Residents receive quarterly bills for sewer and water service that vary by usage, but a flat stormwater charge is attached to quarterly tax bills. Revenues from stormwater fees — $25/quarter for residential and $150/quarter for commercial use – are inadequate to maintain the system as required. These fees need to be raised after more work is done by a Working Group consisting of aldermen and administration personnel.
Water use is measured at each residence and each commercial property. Sewer use is not measured, as there is no known way to do this, so sewer charges are based on water use at the property. A careful analysis by the Working Group reveals the following:
- 80% of water customers use < 125 hundred cubic feet (HCF) per year (1 HCF = 748 gallons)
- 63% of water customers use < 90 HCF per year
Under our current 3-tiered water rates:
- 80% pay < $2,000 per year
- 44% pay between $1,000 and $2,000 per year
- 36% pay < $1,000 per year
Put another way, the “average” household uses 25 HCF of water and pays $608/quarter for water and $896/quarter for sewer, for a total of $1,504/quarter, or $6,016/year.
Our water Budget is $22M annually and our sewer budget is $32M annually.
The Working Group arrived at three options: 1) charge a fixed fee + cost for usage; 2) charge a single rate for everyone; or 3) devise a tiered structure. They recommend the primary considerations be providing sufficient resources for utilities operations and fairness to rate payers – ie, payment for services rendered. Secondary are sensitivity to small users and promotion of water conservation.
The first option would amount to $312/residence for water and $531/residence for sewer, for a total of $843/residence for the fixed fee and then a variable amount for usage. This choice would harm all of Newton’s small users.
The second option, using a single rate of $7.12/HCF for water and $10.36/HCF for sewer to cover estimated costs of MRWA services, would bring both winners and losers. Commercial customers use the most water, and their bills would go down. All other rates would go up except those using large amounts of water. This is unfair and also discourages conservation.
The third option is the best solution, because it promotes conservation and covers capital costs.
Proposed water/sewer rate structure, by tiers
|0-10 HCF’s||$5.50||–||$ 9.25||–|
|Irrigation (of yards and lawns)||9.00|
Residents who are considering going to the last tier would have to install a second meter connected to their outdoor watering system. They would contract with a plumber to install the meter and plumb necessary lines, with the utilities division inspecting and approving the installation. The estimated cost is $750. A calculator will be put on the city’s website so any user can put his/her data in and figure out if an outside watering system is worthwhile. For a household using < 25 HCF per year of outdoor water, the payback period will be 3 years. If people wish to do this, they will have to notify the city of their intent to do so by April 1, 2015. The rates would then take effect on July 1st following installation. Until we know how many people will install second meters, the rates will not be final, and of course there will be a public hearing before aldermen vote on the rates.
Stormwater runoff is a different situation. Current stormwater fees of $25/year for residential and $150/year for commercial properties are not covering the costs. And properties that have impervious pavement (parking lots, sidewalks, driveways, etc.) are costing the city more. People who are water their yards or have a lawn sprinkler system have that water included in calculating their sewer bills. This is thought to be unfair and environmentally unsound. Water put into yards or lawns gets filtered naturally and goes into the groundwater supply, which is good.
The stormwater budget now supports a 6-person crew that is routinely augmented by Sewer Division personal. Stormwater expenses use up all the funds generated with none left for capital improvements. Complying with new EPA regulations, when Newton has to renew its EPA permit, will increase the city’s stormwater system costs. We know we need capital improvements to abate localized flooding, to do stream maintenance, and to do culvert maintenance. In summary, the city must generate additional revenue to pay for an adequate stormwater system.
Recommendations are that Newton switch to a fee based on a property’s impervious surfaces. An impervious surface is any material or structure on or above ground that prevents water from going back into the underlying soil – e.g. sidewalks, roof tops, parking lots, driveways…
Proposed rate structure:
- Each residence would pay $60
- Each commercial property would pay $25/extra ERU (Equivalent Residential Unit).
- 1 ERU = 2,600 square feet
- Each tax-exempt property would pay $25/extra ERU
However, CFO Maureen Lemieux advised that the system of charging by amount of impervious surface is “on hold” by the State. Also, Newton’s data is over 9 years old, so she does not want to use this data. The Law Department is consulting with the state Department of Revenue as to what other system we can use. Since we cannot go by eru’s this year or next year, Lemieux’s recommendation is to plan for 2016 to propose that system, after Newton can commission for new data to be collected. Consensus was to do that, but meanwhile to use the current simple fees and raise them to cover the costs of maintenance for the next two fiscal years. The Law Department will be asked to draft an ordinance using tiers.
Aldermen will continue discussions on this during November and December. A public hearing will be held before rates re voted on. The new charges will eventually appear on bills sent out to property owners for FY2014-2015.