City raises water rates

City rates will go up by a combined monthly total of $7 starting

Morgan Hill residents opposed to a 16.5-percent city water rate
increase mustered nearly a 1-percent protest in an attempt to stop
their monthly utility bills from going up.
Morgan Hill residents opposed to a 16.5-percent city water rate increase mustered nearly a 1-percent protest in an attempt to stop their monthly utility bills from going up.

They needed a majority to keep water and sewer rates at their current level, and only 108 of the city’s 12,285 rate payers protested – as it was their right to under California Constitution Proposition 218.

The council voted unanimously Wednesday to approve the five-year rate increases. The deadline to protest was Wednesday night.

City staff said, and council members agreed, that the rate increases will preserve the current level of service and maintenance without requiring layoffs or other cuts that could make the infrastructure systems less reliable.

Starting next year, monthly water rates will go up by 16.5 percent for water, and 10 percent for sewer services.

Each year after that, until 2016, the rates will go up 6.25 percent annually for water, and 3.5 percent for sewer.

City staff noted the scheduled amount of the increases is a maximum.

The average bill for the combined rates will go up by about $7 more per month, city staff said.

Protesters who spoke at the public hearing on the topic at Wednesday’s council meeting suggested the need for the rate increases stems from mismanagement at agencies who act as the city’s vendors – the Santa Clara Valley Water District which sells wholesale water at a price that climbs annually, and at the South County Regional Wastewater Authority in Gilroy where Morgan Hill ships its waste.

Proposition 218 requires the city to allow water and sewer rate payers to protest any rate increases. If a majority of rate payers protest, the city cannot raise the rates.

The city has avoided raising rates the last three years, instead spending about $1.3 million out of its utility reserve funds. Water conservation caught up to the utility funds though, as customers’ consumption – and therefore the city’s sales – has gone down by 11 percent since 2007, city staff said.

Councilman Gordon Siebert said in response to complaints lodged by some of the protesters that they are being punished for conserving water, that instead they are being “rewarded” because the city’s tiered rate structure requires heavy water users to pay more per gallon.

He added the increased rates are intended to make the system more efficient.

“We went into this year operating in an un-businesslike manner. That’s why the first year increase is significant,” Siebert said.

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