Water, sewer rate hike mulled

Published 11:17 am Wednesday, April 13, 2011

La Grande City Council presented proposal by public works director to raise rates 7%

The increase in sewer and water rates La Grande residents were spared last year may come around this spring when the City of La Grande adopts its 2011-12 budget.

At a work session Monday night, the city council heard a proposal from Public Works Director Norm Paullus to up water rates and sewer rates by 7 percent each.

For city residents, the base rate for water, including franchise fees, would rise from $14.09 to $15.08. Sewer rates would go up from $32.26 to $34.52.

Paullus said the increases are necessary in part because of state government mandates regarding operation and maintenance of the water and sewer systems. He also said his department won’t be able to keep up with capital improvements without the increase.

During deliberations last spring, the city’s budget committee approved a 2 percent increase in franchise fees but decided to forego an increase in the water and sewer rates. Paullus said that because there was no increase, the Public Works reserve fund is running low.

Following Paullus’ talk, Mayor Daniel Pokorney said he doesn’t think the financial situation for local families has changed that much since the last budget process. He said he is against any increase.

“When I was on the council before, I spoke against increases, and I haven’t changed my mind,” Pokorney said. “There’s too many people out there who would be hurt by this.”

Councilor Silas Kelty agreed.

“I’m with the mayor. Times are tough,” Kelty said.

Other councilors weren’t so outspoken, but posed questions for Paullus. Jerry Sebestyen wanted to know what would happen if the city decided against the increases and “limped along” for another year or two at current rates.

“It would be really difficult to maintain the system, and we’d be getting into our reserve fund,” Paullus replied.

In more discussion, City Manager Robert Strope said he doesn’t think deferred maintenance is a good idea.

“When we don’t keep up with maintaining the water and sewer system appropriately, it costs us more money in the long run,” he said.

When the budget committee meets in May, it will consider approving resolutions changing the utility fees.

In 2009, the League of Oregon Cities did a survey comparing water and sewer rates in various cities around the state.

In cities with populations between 10,000 to 25,000, the average water rate was $23.64. The average sewer rate was $31.26.

“We’re significantly lower when it comes to water rates, and in the mid-range on sewer,” Paullus said.

Following Monday’s work session, the city council convened in a special session of the Urban Renewal Agency to consider a “partnership agreement” with Al Adelsberger, owner of the New Town Square building at Washington Avenue and Fourth Street.

Adelsberger, who recently renovated the exterior of the building and sidewalks with help from the URA, asked for – and received – up to $65,000 to remodel the 14,000-square-foot basement of the building.

The council, sitting as the URA board, listened as Adelsberger told of his plans to create The Market Place, an attraction that would function both as a shopping center and as an incubator for small local businesses.

According to Adelsberger’s vision, entrepreneurs would rent cubicles in The Market Place for $300 a month. They would grow their businesses until they were able to move out into larger spaces. He said there would be 66 cubicles available for rent.

Adelsberger said The Market Place would offer shoppers a climate-controlled setting and a park-like atmosphere. The purpose, he said, is to create a “synergy of merchant opportunities, community solutions and tourism excitement.”

The city’s Urban Renewal Advisory Commission had recommended approval of Adelsberger’s funding request.

Adelsberger’s plan also had backing from Union County Chamber of Commerce Executive Director Judy Hector, who said in a letter to the city that as presented, the project would provide low-cost entry opportunities for local entrepreneurs.

Charlie Mitchell, the city’s community and economic development director, said during the meeting that he too favors the project.

“The really intriguing part for me and the commission is the incubator idea. From that aspect alone it demonstrates our commitment to entrepreneurial development,” Mitchell said. “This is unique in that you have a private business willing to take it on.”

Adelsberger said the total cost of the project is about $134,000, and that he hopes to have the center up and running by the next holiday shopping season.

The URA board unanimously approved Adelsberger’s request for up to $65,000, authorizing Strope to enter into and sign appropriate agreements.