Fraser ups water, sewer rates
Posted June 24, 2013
FRASER — Beginning in July, Fraser households will see their monthly water and sewer bills increase to mirror cost increases passed down to the city from Detroit and county drain districts.
Fraser also has opted to bill a true fixed cost, which will remain the same throughout the fiscal year beginning July 1. The charge will replace a so-called “fixed charge” that actually changed every three months based on a rolling average of consumption.
“If there’s any comment that we get from the public that is very consistent, it is, ‘Why don’t you set up and … charge me a fixed rate, and keep it for awhile,’” City Manager Rich Haberman said at a City Council meeting this month.
City officials expect that, in turn, the change will address residents’ confusion surrounding the previously used charge. Haberman said that the city predictably receives hundreds of calls following the quarterly fixed-rate changes.
The city will change the name of the fixed charge to the ready-to-serve charge. Now, the only variable charges for the city’s 2013-14 year will be the monthly water and sewer commodity charges, which are tied directly to consumption.
Under the rate structure beginning with the July bill, households will see a monthly water rate of $2 per unit and a sewer rate of $4 per unit. The adjustments mark an increase from the previously imposed $1.60 per-unit water rate and $3.65 per-unit sewer rate.
Fraser set the new ready-to-serve charge at $20 for households that use 0-3 units, and a $5.35 per-unit charge for 4 units or more.
According to city projections, residents using 0-3 units will see an increase of about $7.25 to $8.80 per month, and users ranging from 4-10 units will see an increase from $6.10 to $14.15 per month.
City officials say that bill increases seen in recent years have been relatively tame compared to the double-digit percentage hikes being passed down the line from the Detroit Water and Sewerage Department and the Macomb and Oakland drain districts.
City data shows that while Fraser residents on the whole have been using less water since 2007, the rates charged to Fraser have been increasing. DWSD has been putting more static costs into the rates it bills to the city — about two-thirds of Fraser’s $6.7 million annual water and sewer budget are fixed expenses — so Fraser has had to increase billing rates in recent years to match these costs.
In recent years, the city has deferred passing on the full increases, and only with the rate increases approved by the City Council on June 13 are water and sewer bills in line with what the city is paying to DWSD and the county drain districts.
This year, DWSD assessed to the city a new “look-back” charge totaling more than $178,000. All told, fixed water and sewer costs being assessed to Fraser increased from $4.08 million in 2012 to $4.44 million in 2013, according to the city.
“In addition to that, Macomb, whose been doing upgrades to the drainage system, has included another bond payment because they’re going to be doing more improvements in the upcoming year,” Haberman added.
All this indicates that no matter how much water it conserves, the city isn’t going to save money, he said.
In the meantime, the city has been delaying needed replacements of the city’s aging water structure — an issue Fraser officials say they won’t be able to postpone for much longer.
In the future, residents could vote to lower their water and sewer bills by moving debt service expenses, which are currently included in the fixed-cost portion of their water bills, to their tax bills.
“Taxes can be claimed as a deduction on income taxes, but the fixed cost on the water bill cannot,” Haberman said. “For those who itemize their taxes, this can reduce costs simply because it is a deductible expense.”
Haberman said the move would allow people who use six or more units per month to save money, but those who use less than six units would not. He said the outcome of the vote made little difference to the city because it would collect the money either way.
A motion to go ahead with putting such a proposal on the November ballot failed to muster support from the seven-member Fraser City Council on June 13.
Noting the City Council had removed it from last year’s ballot, Mayor Doug Hagerty said it was a mistake not to put the issue on the ballot two years in a row.
But City Councilwoman Barb Jennings said she was not in favor of “rushing” it onto the November ballot. If it were to go to the ballot, she preferred putting it on a ballot with traditionally higher voter turnout than this year’s City Council election.
“I’m not saying I don’t want it to go to the people. I’m saying I want it to go to more people than the people who vote in November,” Jennings said. “Thousands of people are going to pay more for water, and they have to be educated.”
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