Safford to vote on utility rate changes at December meeting

Eric Burk File Photo/Gila Valley Central: Safford Utility workers cut open First Avenue in Thatcher to get to a water main break. The city is proposing a water rate increase to pay for infrastructure repairs.

Proposed changes include 13 percent water increase, 10 percent electricity decrease and 5 percent natural gas decrease

By Jon Johnson

SAFFORD – After three work sessions and multiple hours of discussion, the Safford City Council will vote on multiple utility rate proposals at its Dec. 11 meeting, starting at 6 p.m.

The council will vote separately on whether to raise the water rate by 13 percent, lower the electric use rate by 10 percent, and lower the natural gas use rate by 5 percent.

Safford City Manager Horatio Skeete has deemed the water increase as a necessity to enable infrastructure repair of roughly 58 miles of major distribution lines. Skeete had proposed the town of Thatcher and Safford kick in .2 of their respective sales tax revenue to lessen the burden on the individual water user and would have evened water costs for Thatcher and Safford residents, but Thatcher declined the proposal. That caused what would have been a 3 percent increase in 2018 and a 5 percent increase in 2021 to turn into the newly proposed 13 percent increase in 2018 along with a possible 5 percent increase in 2021. Thatcher water customers will still have to pay their 10 percent premium on top of what Safford customers are charged, and customers in the county will have to still pay their 25 percent premium.

Additionally, the proposal will switch billing back to a three-tiered system with the first 3,000 gallons included in the meter charge, which would be $27.32. That would increase the monthly bill for a low-water user who uses just 500 gallons of water per month by $5.04, from their $22.56 current charge.

At the council’s Monday night work session, Safford Mayor Jason Kouts feared that the rate would be a burden on elderly people living alone and not using much water.  

“The thing that really bothers me is on this is that we’re seeing little granny that’s living by herself . . . and we’re going to ask a $5.11 more a month,” Kouts said.

Jon Johnson Photo/Gila Valley Central: Safford Mayor Jason Kouts wondered if the proposed water rate increase would cause an undue burden on those whom can least afford it.

However, Kouts did not give an accounting of the proposed single grandmothers living alone and also did not take into consideration that the low-water users are more likely to be small businesses or vacant properties. A polling of Safford water customers shows that it has 94 locations that use between zero and 500 gallons of water per month. The vast majority fall in between using 501 gallons to 8,158 gallons. For those using 501 to 3,500 gallons (895 locations), the average increase would be $4.76, but for those using between 3,501 gallons to 8,158 gallons (1,209 locations), the average increase would only be $1.78 to their monthly bill.

In Thatcher and in the county, water users would add the 10 percent premium and 25 percent premium, respectively, to the new water rates.

For Safford residents, however, their overall utility bill could actually be less even with the water increase if the electricity decrease and natural gas decrease are approved. Kouts said he wanted to vote on each utility question separately and not associate one with the other in case it turns out that the city has to bring the electric rates back up the following year.

Skeete assured Kouts that any changes would be minimal with price fluctuations in electricity.

“I can confidently assure you that a 10 percent reduction in our electric bill is well within the capabilities of the department,” Skeete said. “What I can also confidently assure you is that in one year I will not be back at this table asking you for a 10 percent increase.”

Kouts said his major problem with the water increase is that it seems to be a significant amount all at once and asked if it couldn’t be spread out over several years.

Previously, after seeing lowered revenues due to a decrease in use during the drought years and encouraged conservation, the Safford City Council did enact across-the-board incremental rate increases at its June 19, 2013, emergency meeting. That meeting resulted in the immediate 5 percent increase in the rates and scheduled increases of 17 percent in the fiscal year 2014-15 and additional 5-percent increases for fiscal years 2015-16 and 2-16-17. However, just as the first 17-percent increase was set to be implemented, the council decided the increases to be too high and withdrew them.

Kouts asked if that history had Skeete wanting to do the rate increase all at once to avoid the council from rejecting future increases, but Skeete said it had more to do with how the loan structure to get the initial $10 million to pay for the infrastructure replacement is done.

The council then agreed to vote on each utility rate separately at its next regularly scheduled meeting. If the proposed rate structures pass, the city will have to allow 60 days before they are implemented, which would then occur in February 2018.