The new rates hit the biggest water consumers the hardest

New water rates in Lake Oswego aim to target the city's biggest water users to fund $53 million in utility upgrades.

Eight years of water rate increases will begin in January in a program approved by the Lake Oswego City Council Tuesday.

The rate increases were approved over the objection of about 20 citizens who gathered to testify against the proposal.

Angry about limited public involvement, a lack of information about new water rates and a disproportionate

impact of new pricing on families, those who spoke left frustrated.

Nearly two hours of testimony failed to convince the Lake Oswego City Council to delay the decision. Instead, elected officials opted to approve the new water rates on a trial basis and probe the program's impacts in two years.

By then, water ratepayers will have seen two of eight annual increases in planned water rates. The increases are aimed at slowly boosting revenue in the city's water utility to fund upgrades, maintenance and an expansion of the water utility to accommodate water users in Tigard.

The rate increases essentially boost revenue from water sales by 15 percent each year but they do not target everyone equally. Instead, the new water rates group water users into three categories, charging the largest amounts to the city's biggest water users.

The program is partly geared toward water conservation. It aims to charge only slight rate increases to 56 percent of the city's lowest-volume water users. Another 26 percent of water users will face moderate rate increases. Large-volume water users, by contrast, will pay three times the rates paid by low-volume water users.

During testimony to the city council, many people disagreed that the city's biggest water users are 'water hogs,' as the program suggests. Most, they said, are simply large families or people with big yards.

Dave Park, a local man with a 10,000-square-foot piece of property, said the new water rates could cause him to pay $600 or more in summer when bimonthly water bills arrive.

Displaying a six-year history of his water bills, Park showed his family generally uses less water than average. But upkeep of his yard forces spikes in water use in summer. Those spikes will force Park to pay a premium for water in dry weather or quit watering his lawn.

'Is the council OK with seeing brown lawns all over town all summer? Does that fit with the image of Lake Oswego you have worked so hard to build?' he said.

His concern about mixed messages from the city - where emphasis on 'beautification' has led to planted medians, new parks, hanging flower baskets and a code that protects trees - resonated with other speakers.

So did the concern that families would be stuck with the biggest bills.

Steve Frame, who has five children ages 4 to 11, called the new water rates 'financial punishment for people with children.'

Frame lives in a 1,400-square-foot house on a 5,800-square-foot property. He said his seven-member family will pay more for water than smaller households once the new rates take hold.

While the water rates were based on an analysis of average water use in Lake Oswego, Frame noted a majority of the city's residents do not have children. Recent data, he said, suggests that only 30 percent of Lake Oswego households have kids.

Families, he said, are likely to fall into the largest water-user group. He objected to paying more based on the number of people in his home.

'People use water, households don't use water. Because we should equally pay for what we use, we should equally share the burden of the goals,' Frame said.

But elected officials ultimately disagreed, throwing support toward water conservation goals.

Though they initially leaned toward taking more time with the decision - two city councilors had concerns about fairness and the impact of rate increases on families - they decided that delaying the rate increases would force steeper rate hikes when utility improvements begin.

'I don't think we need to hit people with a 50 percent or 60 percent increase three years from now. Stepping it up a little at a time, people can build it into their budgets,' said Councilor Roger Hennigan.

Others agreed that trying the program was the best way to gauge its success. It is slated for review in 2011, when city councilors can tweak rules intended to tease out the city's water guzzlers.

Councilor Kristen Johnson also asked for waiver options for families larger than five, concerned the city would discourage new residents at a time when Lake Oswego aims to attract younger families.

Those options, and options to pay an average water bill throughout the year, versus higher bills in summer, will be developed.

Water rates plan

New water rates in Lake Oswego encourage water conservation. They are also intended to fund in upgrades, maintenance and expansion of the water utility.

The utility expansion makes it possible for Lake Oswego to add Tigard water users to the system. By adding Tigard water users, Lake Oswego has reduced the projected cost for repairs to the system by $25 million.

Lake Oswego ratepayers must still fund $53 million of $135 million in needed utility work. That cost is down from $78 million Lake Oswegans would have paid without partnering with Tigard for the plan.

Local ratepayers got their first public glimpse of new water rates at a public meeting Oct. 14. Approved Tuesday, the new rates are planned to last eight years but will be reviewed in two years. They call for two kinds of rate increases:

n The fixed portion of the residential water bill - currently a charge of $26.96 bimonthly for water service - will increase approximately three percent a year for eight years beginning in 2011.

n The variable portion of the residential water bill - or the rate paid for each hundred cubic feet of water (ccf) used - will increase annually for eight years beginning in January 2009.

Based on an analysis of local water user habits, water users will be divided into three groups and will pay different amounts for low-volume, mid-volume and high-volume water use.

Beginning in January, water users that consume 16 ccf of water or less bimonthly will pay 90 cents per ccf, up from 88 cents.

Water users that use between 17 and 32 ccf bimonthly will pay 90 cents for the first 16 ccfs and $1.35 for each ccf thereafter.

Water users that consume more than 32 ccf bimonthly will pay 90 cents for the first 16, $1.35 for the next 16 and $2.74 for each ccf thereafter.

Annually, a typical single-family home uses 22 ccfs of water on a bimonthly basis in Lake Oswego.

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