Council adjusts unintended hike to water rates

March 9, 2010

By Warren Kagarise

Weeks after Issaquah officials tweaked municipal water rates, the City Council adjusted certain rates again last week to correct a minor mistake.

In December, the council cut water rates and enacted a utility tax in what officials meant to be a revenue-neutral move to stave off legal challenges.

Although officials meant for the rate tweaks to be revenue neutral, city employees realized the changes resulted in slight projected rate decreases — ranging from 11 cents to $6, depending on meter size — for commercial customers.

City Council members corrected the discrepancy after city staffers realized the December legislation included incorrect figures. The council approved the adjustment March 1 to avoid impacts to bills scheduled to be mailed to customers March 5 — the first bills mailed under the new rate structure.

The legislation passed without discussion in a unanimous vote during a 10-minute council meeting.

City Public Works Engineering Director Bob Brock said the problem resulted because employees neglected to check the rate-adjustment legislation against municipal water rates adopted in December 2008.

“It was a mistake on our part that we didn’t cross check it on the actual adopted ordinance from December ’08, so the wrong numbers got plugged into that commercial section so we had to rectify it by re-adopting an ordinance with the correct numbers,” he said.

Officials adjusted water rates last year to avoid the threat of a legal challenge related to how the municipality pays for fire hydrants. The city collects $129,000 through water rates to fund hydrants.

In a 2008 case — Lane v. Seattle — the state Supreme Court said hydrants are a general government service, and not a utility. The ruling prompted local governments across the state to search for a way to unlink hydrant costs from utility payments.

City Council members approved the measures Dec. 21. The legislation cut water rates 2.28 percent — worth $129,000 — and enacted a 2.33 percent utility tax on city water — to raise the $129,000 lost by the rate decrease. The tax enabled the city to use money from the city general fund to pay for hydrants.

“When Finance [Department] was running the tests to make sure that we got the net-neutral cost, they noted that they weren’t coming up with net neutral,” Brock said.

Warren Kagarise: 392-6434, ext. 234, or wkagarise@isspress.com. Comment at www.issaquahpress.com.

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