The El Dorado City Commission approved a rate increase that would raise in-town residential users by 2 percent
El Dorado water customers will be seeing an increase in their water bills starting next year.
The El Dorado City Commission approved a rate increase that would raise in-town residential users by 2 percent and large tier 2 users by 6 percent.
This increase was the compromise from a proposal to raise large water users by 14 percent by removing the second tier and no increase for tier one. After hearing concerns and looking into the issue further, the city commission decided they did not want to move to a single tier system at this time.
"This was a compromise that put some of the burden on residential users," said Kurt Bookout, public utilities director. "I think it is a good compromise."
Commissioner Bill Young pointed out it was needed because of increasing costs of doing business, including a raise in fuel costs over the past eight years from $220,000 to nearly $350,000 for all departments.
"Just the general cost of business has gone up," he said. "It's eight years later (since the last increase) and we are looking at a small increase."
Commissioner Chase Locke added they also need to do some line extension and replacement projects.
"I'm more pleased with this than the original pitch we had a couple weeks ago," he said.
Young agreed, saying, "I am glad we did take the time to have a work session and take time to get this second proposal. I think this is a better solution for everybody."
The first bill that will reflect the increased rate will be the one received in February for January usage.
"And we're still some of the cheapest water around," Bookout added.
Earlier in the meeting during the public comment time, Bruce McCabe, chair for Rural Water District 3 Board.
"I know your rate for the city is 1.68 per thousand," he said. "Our customers pay $6.50 now. With the rate increase that would put us up over $7.50 a thousand. That is pretty steep for some of our customers."
He said in the past year El Dorado has received more than $500,000 in revenue from what the water districts pay above in-town rates.
"We are asking that we would like to know how those funds were used," McCabe said. "Typically, rates to wholesale customers do not exceed funding costs to operate the entire water department. It looks to us like that is already in process. Does El Dorado provide a breakdown of costs as far as what they are charging the rural water or what percentage of rural water money goes to in-town infrastructure repairs and maintenance."
He went on to say if the city was trying to encourage water conservation rates with the increase, they should offer low flow shower heads or other rebates to show they are in support of making conservations.
"Until the city's water system implements a real water conservation effort, then the talk about water conservation is just talk," he said. "It can be used as an excuse to increase rates."
Bookout responded to the increased rate by saying, "With this rate increase, we're charging the rural water district $2.75 a thousand and they're going to charge $7.50 1,000 gallons. I know typically they have to charge double what we charge, but by my math that is more than double."
After a motion and second to approve the ordinance, Mayor Mike Fagg read a statement he had prepared.
"When our community looks at raising water, sewer and refuge rates, I would like to start with the expense side," he said.
He wanted to be able to look at how current expenses related to the prior year.
"Our decisions are based totally on what staff are telling us we need in additional revenue from our water customers," Fagg continued. "I do not believe in co-mingling funds from different departments."
As he has brought up at previous meetings, Fagg reiterated he does not think the payment for the stadium or ICMA retirement should be taken out of those department budgets as they are now.
"When you take the payment for the football stadium and ICMA it is 60 percent of the amount estimated to be raised with the water rate increase," he said. "I feel purchasers of El Dorado water should not have to make payments on the stadium."
He also asked who receives the ICMA retirement and why.
"An 8 percent increase here and 11 percent increase there, they all add up," Fagg said. "When citizens are not receiving an increase in their income the money has to come from somewhere."
The commission then voted 4-1, with Fagg opposed, to approve the ordinance, but that was not the end of the discussion.
During the new business portion of the meeting, Young brought up the issue again.
"We have had multiple discussions over the last few meetings regarding the stadium and ICMA," he said. "I think we need to probably get some information on ICMA so we can understand and explain why we feel it's important to offer good retirement for our employees who work hard for our city. I think it is disingenuous for anyone to tie the fact we haven't had a rate increase in eight years to a rate increase now and tie that to a decision a year ago (for funding the stadium)."
"Whether or not we take care of our employees has no impact on if we raise rates," he continued. "I think our rural customers who are farming and ranching understand that the cost of business does go up.
"We all talked about the goal of trying to keep the costs low. I think this is an opportunity to kick a hornet's nest and try to stir things up based on ICMA and stadium payments when the reality of it is the cost of doing business has gone up. I don't want to take away from the fact we did operate for eight years without an increase. We have diligent staff who have trimmed and cut in those eight years so they didn't have to ask for an increase."
He recognized the staff for doing their jobs to cut those costs.
Young also said they have realized maybe they don't want to wait eight years for an increase so it does not have such an impact on people.
He also wanted to have a discussion on ICMA so they can all understand it and why the commission made the decision to implement it three years ago when the commission changed the retirement plan for police and fire.
"It was a way to say a man on the back of a garbage truck was just as important as a man on the back of a fire truck," said Herb Llewellyn, city manager. "That was how the commission addressed the issue of increasing the retirement of police and fire."
He said neighboring towns were not only paying more but also offering better retirement plans, so this was a way to keep employees.
"I think this decision made three years ago really highlights the form of government we have in El Dorado," Young said, adding that he thought it was a wonderful form where they all bring different backgrounds and expertise to the governing body.
"It is real easy to look back and second guess decisions made," he said. "The bottom line is decisions were made. It's water under the bridge or we need to revisit it. We need to decide which."
Locke also added one final comment to Fagg's statement.
He said he 100 percent understands where Fagg was coming from, but he did not like the fact Fagg said the decision was made just on the recommendation of city staff. Locke said he talked to city staff and department heads and got outside advise on the decision about waer rates.
Julie Clements can be reached at email@example.com.