The City of Hollister will likely increase water rates to its
6,200 customers by about 13 percent to 14 percent within the next
year because of an outdated fee structure, according to
officials.
The City of Hollister will likely increase water rates to its 6,200 customers by about 13 percent to 14 percent within the next year because of an outdated fee structure, according to officials.
The City Council adopted the last update to water rates in 1991, but the fees should be re-evaluated “every few years,” Finance Director Barbara Mulholland said.
According to Utility Manager Jim Perrine, Hollister, compared to other cities in the region, has been charging lower water rates for many years. Meanwhile, he said operational costs during the past decade have increased.
The city finances water operations from an enterprise fund, which the city is required to use for water distribution. It is one of several cash reservoirs independent of the General Fund.
The water enterprise fund, which generates most revenues from residents’ bi-monthly bills, is projected to operate with a $539,000 deficit during the current fiscal year. That over-expenditure will come from the fund’s reserve, which is currently $855,000.
“We really need to make a change there (the rate structure),” said City Manager Dale Shaddox. “That’s it.”
Other local water districts have increased rates throughout the years, including Sunnyslope Water District, which has increased its fees twice since 2000.
“We need to keep current with the actual costs for providing water,” Perrine said.
The city’s water rates were among about 50 such fees officials plan to adjust in the coming year, Mulholland said. Officials also are considering increasing building permit fees. Planning for the potential fee update was in “preliminary stages,” Shaddox said.
Mayor Brian Conroy said the fee structures have likely cost the city some revenues, but officials could not estimate any amounts.
“I’d have to say there has been some impact,” he said. “Whether it’s substantial, it’s hard to tell.”
Officials recently talked with outside consultants about the potential for a “fee study report.” That analysis, if commissioned, would be completed by February 2004. And if any changes receive approval from the Council, they would most likely be enacted in mid-2004, according to Shaddox.
The city charges customers for water every other month with two separate fees. There is a standard base meter fee charged according to each meter size and another for the amount of water used.
Perrine said there was no concrete information regarding average amounts billed to the district’s variety of customers, which includes homes, businesses and industry.
The city is currently updating master plans for water and sewer operations, Shaddox said. Once those documents are completed, Shaddox said Hollister will consider updates to impact fees, which can be used only for structural expansions to the systems.
“We don’t want to raise them (the fees) too high,” Councilman Robert Scattini said. “But we need to stay afloat.”
