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Independence, MO —
In most instances, water seems pure and simple.
But Monday night, one of the essentials for life received significant discussion from the Independence City Council. Following up on last week’s study session, council members voted to raise water rates for Independence Water Department customers. That increase takes effect Oct. 1 and will last annually through Oct. 1, 2016.
District 2 Council Member Curt Dougherty and District 4 Council Member Eileen Weir both voted against the increase, saying they had received many calls of concern from their constituents. Dougherty pointed to the fact that the Water Department increased its rates 9 percent annually from 2008 through 2011, as well as the department’s plan to fill about 10 vacant positions.
“The people of the 2nd District say ‘no – live without those 10 employees, and make do like we have to do,’” Dougherty said. “...I think we need to make do. I’m not completely sold on this.”
Weir asked city staff why Independence commands such a low price for its award-winning water to the wholesale customers, including the cities of Lee’s Summit and Blue Springs, which make up nearly half of the customer base for the Water Department.
Because of long-term agreements made with wholesale customers, City Manager Robert Heacock said, the city must have a cost of service study conducted by an outside consultant before proposed a rate increase, which it did this year and in 2008 with Black & Veatch.
Weir replied that the city should work even harder in attracting industrial and commercial businesses to Independence so that the water rate expenses – “or, in some cases, what I would consider a failure in economic development,” she said – aren’t heavily passed along to residents.
Weir also raised concerns about recent statements regarding the impact conservation makes on the amount of water sold to customers. In 2011, the Water Department customers used less water, a trend that has fluctuated significantly since the onset of the economic recession in 2008.
She said conservation is sometimes intentional and other times is not, especially as customers are turning off their lights and water to save money on monthly bills.
“I find it somewhat, I guess, ironic that we hold an EcoFest and teach people how to conserve our water source, and then when they apply that knowledge, we increase their rates because they’re not using enough,” Weir said. “I, too, have heard from my constituents and from others around the city with concerns about increasing this rate. I think that we can find efficiencies. I think that we can put on our sales caps a little bit more and find ways to increase the number of people who are paying, rather than increase the rate.
In most instances, water seems pure and simple.
But Monday night, one of the essentials for life received significant discussion from the Independence City Council. Following up on last week’s study session, council members voted to raise water rates for Independence Water Department customers. That increase takes effect Oct. 1 and will last annually through Oct. 1, 2016.
District 2 Council Member Curt Dougherty and District 4 Council Member Eileen Weir both voted against the increase, saying they had received many calls of concern from their constituents. Dougherty pointed to the fact that the Water Department increased its rates 9 percent annually from 2008 through 2011, as well as the department’s plan to fill about 10 vacant positions.
“The people of the 2nd District say ‘no – live without those 10 employees, and make do like we have to do,’” Dougherty said. “...I think we need to make do. I’m not completely sold on this.”
Weir asked city staff why Independence commands such a low price for its award-winning water to the wholesale customers, including the cities of Lee’s Summit and Blue Springs, which make up nearly half of the customer base for the Water Department.
Because of long-term agreements made with wholesale customers, City Manager Robert Heacock said, the city must have a cost of service study conducted by an outside consultant before proposed a rate increase, which it did this year and in 2008 with Black & Veatch.
Weir replied that the city should work even harder in attracting industrial and commercial businesses to Independence so that the water rate expenses – “or, in some cases, what I would consider a failure in economic development,” she said – aren’t heavily passed along to residents.
Weir also raised concerns about recent statements regarding the impact conservation makes on the amount of water sold to customers. In 2011, the Water Department customers used less water, a trend that has fluctuated significantly since the onset of the economic recession in 2008.
She said conservation is sometimes intentional and other times is not, especially as customers are turning off their lights and water to save money on monthly bills.
“I find it somewhat, I guess, ironic that we hold an EcoFest and teach people how to conserve our water source, and then when they apply that knowledge, we increase their rates because they’re not using enough,” Weir said. “I, too, have heard from my constituents and from others around the city with concerns about increasing this rate. I think that we can find efficiencies. I think that we can put on our sales caps a little bit more and find ways to increase the number of people who are paying, rather than increase the rate.
“We’re very proud of our water in this city, and we’ve won these incredible awards. We have great water, so that’s a commodity we have to sell. I feel we should be out there marketing what is a great commodity.”
But those council members in favor of the rate increase say the city is simply incurring the cost of doing business, such as staying on top of its already-deferred maintenance program and building back up its 45-day operating reserve, which won’t be met in 2012.
The Public Utilities Advisory Board, comprised of citizens, unanimously approved the rate increase on June 21. Zachary Walker, the city’s management analyst, also reviewed Black & Veatch’s report and said a rate increase was justified.
Heacock also clarified the payment in lieu of gross receipts tax that is collected as part of Independence utilities, including water. The long-standing 9.08 percent tax is part of the water rate, Heacock said, and is not separate. That amount goes into the city’s general fund, but Heacock said the water rate increase would have “no residual benefit into the general fund” for the 2012-13 fiscal year.
“We were not doing this for any other reasons other than meeting the needs of the utility,” Heacock said.
He also said Independence’s water rates, even with the upcoming increase, are lower than other cities, including Kansas City and Lee’s Summit. Water Systems Director Dan Montgomery said the department has deferred maintenance for several years, and that adding back employees isn’t the main factor for the increase.
“The financial need is there,” Montgomery said. “We’re all facing tough economic times. The past rates just weren’t generating enough cost to cover what we were doing.”
District 1 Council Member Marcie Gragg said she relies on the professional opinions of city staff members and outside consultants when making decisions like the rate increase, calling it a necessary part of doing business.
“Sometimes, we have to do what’s right and not always what’s popular,” Gragg said. “I think this is one of those cases.”
