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Medford service fees could rise for businesses

Fees for streets, sewers and other services could result in sharp increases for many Medford businesses, fueled by steep rises in inflation.

Medford City Council agreed Thursday night to continue looking at increasing fees to pay for maintenance and improvements to city utilities.

Over the next four years, street fee revenues need to go up 6% a year to deal with deteriorating roads, and then another 5% in the fifth year.

Sewer fees could go up 4% a year over the next five years.

The proposed fee increases target commercial users and offer reductions for residential customers, according to Ryan Martin, deputy city manager and finance director.

“Currently residential heavily subsidizes commercial customers,” Martin said.

Most of the fee increases would begin taking effect in 2023.

For residential customers, the proposal calls for reducing the residential utility rate from $56.58 to $55.21 a month.

Businesses could see the steepest rises. Convenience markets could get hit with a 200% rate increase from $267.66 to $831.57 a month, under the proposal.

Some retail businesses would see a 91% increase, from the current $2,287.82 to 4,360.11. Medical offices, entertainment and fitness businesses, as well as churches would all pay more for utilities under the proposal.

If approved by the council, the fee increases would generate an additional $265,000 annually for sewers, $500,000 for streets and $46,000 for public safety.

The last time fees were increased for sewers was in 2020, for streets in 2017, for public safety in 2019 and for parks in 2020.

Inflationary pressures are one reason for the rate increases.

Some of the expected inflationary factors include increases in salaries at a rate of 2.75% a year, benefits by 6%, and construction costs by 5% a year until 2025. Operations costs are expected to rise by 3% annually until 2025.

The cost to maintain city roads has jumped 100% over the past five years, according to the city’s analysis.

Streets alone will need an additional $86 million over the next 20 years to avoid a continuing decline in road conditions, according to a city transportation analysis.

The sewer system needs $44.2 million over a 20-year period, according to the city analysis.

Some city services will not see fee increases.

The street light fee could see a 62.5% reduction because of reduced maintenance and improved life of LED lights. The reduction would represent a $3.34 decrease in monthly fees.

Public safety would receive a 1% increase in fees for five years under the proposal.

The city also collects system development charges on new construction to help pay for upgrades to city utilities.

The council will be looking at a staff and consultant recommendation to increase sewer charges by $227 every year for three years. Likewise street charges would go up $451 for every year over a three-year period, and parks charges would go up $575 a year over three years.

In total, the increase in these charges on new development would amount to $3,700 over the three-year period.

Councilors will consider the proposed charges on new development in September.

Reach freelance writer Damian Mann at dmannnews@gmail.com.