Prospect of bigger bills angers utilities users
Colorado Springs Utilities took its case for an 11.8 percent rate hike to the City Council on Tuesday and got an earful from residents and businesses wary of higher utility bills.
The city-owned utility says the increase is needed because the housing slowdown has sliced into the fees it collects to hook up new houses, which long subsidized the water system.
Officials also cite the need to build new projects, including the proposed $1.1 billion Southern Delivery System pipeline, and work needed on the electrical system.
For residents, the increases would be 41 percent for water, 14.3 percent for wastewater and 8.7 percent for electricity, a total of $18.24 a month on what Utilities said is a typical residential bill.
A dozen people spoke against the rate hike.
"I think it is irresponsible for Colorado Springs Utilities to ask for a 41 percent increase in water rates. They well know water is a necessity the citizens of Colorado Springs cannot do without," said Phyllis MacDougall.
Businesses would be affected differently, with water rate hikes of 43.8 percent for commercial and 42.9 percent for industrial users, and wastewater hikes of 17.3 percent for commercial and 13.5 percent for industrial users. Electric rates would remain flat or decrease slightly.
"If I were to raise my rates to my customers to the extent Utilities is proposing, I'd drive them away," said Dan Light, who owns a self-service car wash. "I'm just concerned businesses like myself and others that are utility intensive are going to feel the pinch out of this."
Utilities also wants to increase the development fee charged to hook up new houses to the water system from $8,600 to $9,292 per house, and to increase rates for nonpotable water.
Other speakers criticized Utilities for plans to award $9.8 million in bonuses to employees this year.
Bruce McCormick, chief water services officer, said Utilities has tightened its belt considerably.
Utilities officials say they are obligated to give the bonuses this year because they are part of employees' base pay, and the pay-for-performance system is ending this year.
Employees are also going without pay raises in 2009.
The City Council will vote on the rate hikes Jan. 27.
"Nobody likes to raise rates, particularly in a down economy and the conditions we find ourselves in," said Councilman Randy Purvis. "It's something I feel is necessary to retain the financial integrity of the utilities department."
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