Sedona City Council sets April 13 for public hearing on sewer rate increase

SEDONA, AZ - (February 28, 2010) - The Sedona City Council at its Feb. 23 meeting set Tuesday, April 13 for a public hearing on a sewer rate increase for Sedona.

The council unanimously approved a sewer rate-increase option that recommends raising the current $390 sewer rate per household to $687 annually over the next five years.

Restaurants seating 166 customers or more will experience a 76 percent cumulative increase over the next five years from $10.08 per seat to $17.74 per seat.

A standby capacity fee for property owners with vacant property near sewer lines will be set at 50 percent of the amount established for residential users, which would increase from $5,150 to $7,069.

In the past 20 years, the City has spent in excess of $100 million to build and maintain the wastewater treatment plant and connect properties to the sewer system.  The City has not increased monthly wastewater rates in almost 14 years, and not increased the capacity fee in almost 10 years.

Assistant City Manager Alison Zelms made it clear that once the new sewer rates are brought to the public for discussion, the council could not raise them above the levels publicized in a “Notice of Intention” to increase wastewater rates that will be mailed to every user in their next sewer bill.

This notice of intention must be sent to the public before the council can legally proceed with a sewer rate increase.

“The council can’t adopt something higher than what the resolution states,” Zelms said.

During their deliberation some councilors expressed reluctance in setting a date for the meeting considering the economic gloom settling over the country and city.

“This is terrible timing,” Councilor Nancy Scagnelli said. “I know we have to do something but this is such bad timing, very bad timing for our businesses. We are doing this just to move forward. I’m not sure what we need to do. Clearly, the less impact is the preferred option.”

Sedona City Manager Tim Ernster said a meeting was held with restaurant owners the day before the council meeting.

“They want us to revisit on how they will be charged and look at other ways to assess charges for restaurants and other businesses,” he said. “Businesses that invest in cleaning up their water want to pay less.”

Zelms said though restaurant owners participated in the discussion, they were not in agreement with the increase, choosing the option selected by the council with hopes of lessening its impact or changing it the future.

Zelms also explained the council can alter the presented sewer fee increase rates in any fashion they choose as long as they do not increase the rates beyond those publicized.

Responding to the council sentiment that the timing of the public hearing was not good at the present time, both Mayor Rob Adams and Councilor Pud Colquitt argued no more time should be wasted considering the importance of moving forward with a rate increase.

“It will never be a good time,” Councilor Colquitt said. “Good times, bad times it's a bad time for the city. I’m willing to take this first step rather than delaying it for six months. We all agreed at the retreat to move forward with the wastewater fee increase and the sales-tax collection. This will be a good solution in balancing the budget.”

Mayor Adams was equally adamant in moving forward with the sewer rate increase.

“I’m not wild about balancing the budget on the backs of our citizens,” Mayor Adams said. “As councilors we have a fiscal responsibility to the city budget.”

Councilor Marc DiNunzio said it is not just restaurant owners being impacted by the fee increase but residents as well.

“I am equally concerned for residents that live on a fixed income,” he said.  “I support having wastewater rates that cover operating costs.  It’s a balancing act for us. We have to be totally transparent. We will be perceived by some that it’s a done deal without their input. We want it clear that this is an opportunity for the public to be heard.”

Ernster said if the council delayed moving forward with the rate increase, the city would have to continue subsidizing wastewater treatment using 46 percent of its collected sales tax. He said the city would still be able to manage and balance the budget.

“It won’t make it impossible, just difficult,” he said.

At the meeting the council considered five options for setting the new sewer rates. Staff recommended Option 4, which proposed the lowest overall rate change over the next five years. Option 4 was the option chosen by council.

Option 4 also has does not offer restaurants and other non-residential users reduced rates for reducing their waste (an equity adjustment). Staff recommended revisiting this in three years.

Ernster said staff will be working through the Chamber of Commerce and the Main Street Association to meet with the business community to explain the proposed rate increase alternatives prior to the April 13 public hearing.