Wichita water rates projected to rise 56% over decade
09/03/2012 2:43 PM
08/05/2014 8:41 PM
Wichita’s water and sewer rates could rise a combined 56 percent over the next decade, according to projected increases recommended by the city’s water utilities advisory committee.
Next year’s increase would average 5.8 percent for water and sewer combined, though the increases would range from 2.3 percent for a high-use residential customer to around 7 percent for commercial and industrial customers.
The proposed increases follow a decade when rates climbed every year, usually exceeding inflation. They stem largely from expensive projects intended to secure future water sources and fix the city’s aging infrastructure.
“Nobody likes, I mean, nobody likes these rate increases,” said Wichita City Council member James Clendenin. “I haven’t run into one person, including myself. But I think, unfortunately, they’re necessary.”
It could have been worse, city officials say.
The city utility didn’t increase rates enough in recent years to cover the growing costs of an aquifer recharge project and a pile up of expenses tied to replacing aging water lines, city officials say. When the city realized its poor financial flows in 2010, it looked the water customers could see double-digit hikes for years to come.
But city officials plan to give council members new options in a workshop Tuesday. Those involve some proposed reductions in operating costs, mostly derived through new technologies that save energy and other little costs.
Officials will also propose freezing the speculative water line extensions the city used to install in anticipation of development, mostly because the housing market has slowed to a crawl and about 2,600 vacant lots already have water and sewer lines in place.
That means it will take about 18 months to design and install water lines for developers who want to build in areas that aren’t already equipped.
The city doesn’t expect that to be a significant problem but acknowledges it will have to re-evaluate its approach based on economic conditions. The city had 325 new residential building permits last year, compared with an average of 1,100 annually over the last 10 years.
All told, the new projections, while they may shock some, are almost 32 percent lower than projections produced in 2010.
City Manager Robert Layton emphasized that the new projections are just a planning tool, and each year’s increase requires approval from the City Council. Residents will have several opportunities at district advisory board meetings and neighborhood association gatherings to ask utility officials questions through November, when the council is likely to vote on a 5.8 percent hike effective at the start of 2013.
“We’re going to take a business approach,” Layton said. “We want to provide predictability for ratepayers, and we want their feedback.”
Complicated water future
Out of that proposed 56 percent rate hike over the next 10 years, almost 19 percent is attributed to inflation. The rest would pay for a long list of water main replacements, replacing old water meters with ones that can be read remotely, a project to remove nutrients from wastewater and, the biggie, the Equus Beds Aquifer storage and recovery project.
Construction is mostly complete on the second phase of the recharge project. When the project begins operating, perhaps next spring, the city will be able to put up to 40 million gallons of water a day back into the aquifer. It’s projected to provide ample water for the next 40 years. But it has a $550 million price tag that Wichita and the surrounding communities will be paying off through their bills for years to come.
The city put phases 3 and 4 of the project on hold while it looks at other options that could be cheaper, such as piping water from El Dorado Reservoir and finding more uses for treated wastewater, which otherwise goes back into the river.
In the mid 2000s, the water utility asked City Council members to increase rates to pay for the project. But council members often wouldn’t agree to the increases the utility wanted.
Now, Mayor Carl Brewer said, we’re paying the price.
“They really needed it, but they never educated the council on why it was actually needed except that it was needed,” he said. “Now we’re in a predicament where we have to make it cost effective.”
Alan King, director of public works and utilities, said Wichita will focus on maintaining its existing water lines. He said in past years the city fell below nationwide standards for replacing old water lines.
Ben Nelson, the city’s strategic services manager, said the city has seen a sharp uptick in water main breaks in recent years. From 2007 to 2009, the city was about average – those were wet years.
But dry weather exposes weaknesses because people use more water to irrigate and high temperatures are harder on pipes just like they are on roads.
Nelson said hot, dry weather in 2010 pushed breaks up by 40 percent; last year, the breaks increased by 50 percent. This year it’s down about 10 percent, but still way above average.
Meanwhile, sewer rates will rise in part because of future Environmental Protection Agency mandates that will require the city to remove nitrogen and phosphorus from treated sewage water before it’s pumped back into the Arkansas River.
Those minerals promote the growth of organisms and bacteria that deplete oxygen levels and make it tougher for downstream communities to treat their drinking water.
The city is looking at a $146 million project sometime near 2020 to address that issue.
Clendenin said people are upset about rates increasing. But he said they tend to be understanding once they hear the reasons – though they’re still not happy.
“They think maybe we’re trying to use the water system to gain more income, and that’s absolutely not true,” he said.
The real outrage, he said, would likely come if the city falls behind on its water system to the point that it can’t adequately supply water or constant pipe breaks disrupt service.
“At this point, we’re really trying to ensure when people go to that tap and turn it, the water is there,” he said.