By GARTH STAPLEY
Nov. 15, 2000 (The Modesto Bee)—Home sewer rates will go up 8 percent and commercial rates will drop 20 percent, Modesto City Council members decided late Tuesday.
A council majority, however, rejected a second proposal that would have raised all rates an additional 3 percent.
The first change is required by Proposition 218. Approved by California voters in 1996, it outlawed one class of customers subsidizing another. That's what has happened for years in Modesto, where commercial businesses paid 17 percent of the city's total sewage bill but accounted for only 9 percent of the system's costs.
Making rates more fair to stores will bring no extra money to a sewage system badly in need of more money, engineering director Glen Lewis said. That's why he asked for the 3 percent hike for all customers, which would have brought in $540,000 per year.
But Lewis didn't make a clear case for why the extra 3 percent is needed, Councilman Mike Serpa said as he cast the swing vote in a 4-3 tally Tuesday at 10 p.m.
Mayor Carmen Sabatino and Councilman Bill Conrad argued against the rate hike on principle. It wasn't long ago, they noted, that the city's water and sewer funds were swollen with a $7.2 million surplus, thanks to years of overcharging.
A Stanislaus Taxpayers Association lawsuit stopped the overcharging in what became a public relations fiasco for the city, but the surplus remained in limbo. A council majority refused to make rebates to customers, and the money was placed in the city's general fund with a plan to augment the city's water and sewer funds little by little.
If the money had been left in the utility funds, officials wouldn't need to raise sewer rates for three or four years, Lewis said in answer to Sabatino.
"This situation is a result of poor decisions made in the past," said Sabatino.
Lewis' staff had asked for the full 11 percent hike for home sewer rates, which would have boosted monthly bills from $11.29 to $12.53.
"Eleven percent?" resident Judy Doty asked, noting recent inflation rates closer to 4 percent. "I don't think people on Social Security get an 11 percent increase. Where I'm working, I'm not getting an 11 percent increase."
Councilman Bruce Frohman said he voted against the across-the-board rate hike because it would cause hardship to customers.
Voting for the increase were Councilmen Armour Smith and Tim Fisher and Councilwoman Kenni Friedman.
Lewis' staff had mailed 56,300 notices to customers about Tuesday's public hearing, which started three hours and 40 minutes after the published time. About 260 people protested the increases before the meeting by mail and telephone, though only two residents stuck around to speak at the hearing.
Lewis had hoped to ask for additional hikes of 3 percent and 2 percent for all customers in each of the next two years. It's not clear how Tuesday's vote will affect those plans.
Sewage rates last were raised in 1996, by 3 percent.
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