Chandler residents will see their utility bills go up by about $5 a month under a proposed rate increase that will likely be approved by the City Council in 2011.
“So, for less than — what, a venti latte? — you’re covering your increase in service costs,” said Dennis Strachota, Chandler’s management services director.
Before residents start eschewing Starbucks trips, the Council must decide on one of four rate-increase proposals, and the city will hold a meeting to solicit public input at 6:30 p.m. Tuesday on the second floor of the Downtown Library, 22 E. Delaware St.
City officials believe the increases — which would go into effect in April and continue to rise through 2015 — are necessary to help pay construction debt service and enable the water/wastewater system to expand to meet Chandler’s future needs.
“All the revenue from the rate increase will be dedicated to the debt, to repay the borrowing done for any plant expansions or improvement as well as replacement of water and wastewater lines,” Strachota said. “We have a capital improvement plan that covers 10 years, and we space out improvements to make sure that we have enough capacity to meet federal and state requirements and replace and upgrade facilities over time as we grow.”
Impact fees were a large source of funds to pay Chandler’s debt service, Strachota said, but those have gone down as the economy soured.
“What used to pay for half of the new improvements in years past now pays for much less,” Strachota said. “We have to borrow in advance of those fees coming in. We have to do the improvements now. We cannot wait.”
The four options involve keeping seasonal rates or maintaining the typically higher summer rates for the entire year. The Council could opt to increase rates annually or every other year, by a larger amount.
For example, if seasonal water rates are maintained, one option calls for increases of 8 percent in 2011, 7 percent in 2012 and ’13, 3 percent in ’14 and 2 percent in ’15. Another option features hikes of 11.5 percent next year, 12 percent in 2013 and 6 percent in ’15, but no increases in 2012 or ’14.
“The options are all the same in terms of revenue collected,” Strachota said. “It’s just a matter of how we would structure it.”
A family that uses 12,000 gallons of water a month currently pays an average of $26.83 for the service, according to city statistics. That monthly amount would increase to $28.98 under an 8-percent rate hike.
The wastewater service, currently $19.97 a month, would rise to $22.17 with an 11-percent rate increase.
The Council is expected to deliberate the four options at meetings in December and January, with a public hearing tentatively scheduled for Jan. 27.