Water hook-up fee plan spurs concern
A Medford Water Commission proposal to more than double water-system hook-up fees on new construction has drawn letters of concern from the mayors of Talent and Phoenix. However, the commission's manager says the increases are necessary to ensure the area will have an adequate water supply in the future.
The Water Commission's system-development charges would jump from $948 to $2,258 beginning Jan. 1, with the funds used to expand the Duff Water Treatment Plant on the Rogue River over the next 30 years. New homes in Talent and Phoenix would pay more than $5,000 when the commission increase is added to city water-system fees already charged by the two south valley towns.
"If there's any way they could reduce the costs, I think that would be a good thing, especially in light of the current economy," wrote Carlos DeBritto, mayor of Phoenix. "When added to our own charges, it's way above the state average, which of course is not a good thing."
New homes built in Phoenix would pay $5,859 when the commission amount is added to the town's charge of $3,601. Talent's new homes would be charged $5,054, including $2,796 for the city. Both cities have big upfront water-system fees of their own as the result of system upgrades and costs associated with recent connections to the Water Commission's pipeline.
Other towns also would have to pass on the fee to their customers. Including city water-system fees, charges in Central Point would rise to $3,850, Eagle Point to $4,669 and Jacksonville to $3,714. Current total charges are $2,540 in Central Point, $3,359 in Eagle Point and $2,404 in Jacksonville.
Residents in Medford and other areas served directly by the commission would pay only the $2,258 after Jan. 1. Ashland is not hooked up to the system at this time.
The big increase is not likely to be greeted warmly by the home-building industry.
"This is simply not the time to raise costs, but to lower costs or get a moratorium until we get the economy going," said Central Point builder Mike Duncan. "We don't like it because those costs get passed on to the homeowner."
Duncan said he is very nervous about whether to start on a 90-home development in Central Point. It would be his first development in 31/2 years, but he admits the fee increase probably wouldn't affect most projects.
"It's not sufficient to motivate one to go ahead or stop," he said.
A public hearing will be held by the Water Commission in October. The commission must approve the proposal, then cities must hold their own public hearings on any increase.
"We have recently done facility planning ... with the growth rates that are being looked at," said Larry Rains, Water Commission manager. "We need to have more water supply."
The Duff plant can currently treat 45 million gallons of Rogue River water daily, but there are summer days when use exceeds 60 million gallons. Big Butte Springs provides the commission with 26 million gallons per day and there is storage capacity in the system for treated water.
A first-phase project planned in the next two to 10 years would add another 15 million gallons of capacity at the plant.
A second plant would be built adjacent to the Duff plant in 15 to 20 years, said Rains. That plant would initially treat 20 millions gallons per day, but could be expanded to handle as much as 60 million gallons.
"You don't build and expand (communities) if you don't have a water supply," said Rains. "Or if you don't collect enough over time to pay for the facility you have to bond. That will be high-dollar and you have to pay higher rates."
Both DeBritto and Talent Mayor Don Steyskal asked the commission to look at assumptions they used in preparing the plan. They questioned whether conservation rates, in which those who use more pay at a higher rate, were included in the calculations and whether the impact of new technologies were considered.
An informal survey by the commission — of water-system development fees in 14 mid- to large-size jurisdictions in the region — found Medford's current $948 charge to be the lowest and Ashland's $5,208 to be the highest. Grants Pass charges $2,462; Portland, $2,200; Corvallis, $1,854; Salem, $4,291 and Bend, $4,449. Average for the survey was $2,971.
"Right now we are on the very, very low end," said Rains. "Even with these increases over time we will be in the middle or high middle."
Tony Boom is a freelance writer living in Ashland. Reach him at firstname.lastname@example.org.