TIM GROSS, NEWPORT PUBLIC WORKS DIRECTOR
UTILITY FEE INCREASES AND PLANNED INFRASTRUCTURE PROJECTS
On August 31, the City of Newport will mail the July water bills.
These bills will include new water and wastewater rates, and a new charge – storm water utility fees. These fees became effective on July 1.
Like many other communities, the City of Newport is faced with water and sewer facilities that were installed between 40 and 70 years ago. Much of it is beyond its useful life and has failed, or is about to fail. The result is significant property damage and costly service outages.
These fee increases have been implemented as part of a program to fix these problems. The rate increases were discussed in a series of public hearings with the City Council, and were approved on June 18 as part of the Fiscal Year 2012/2013 budget.
Some of the city’s most immediate projects will be:
* Big Creek Lift Station and Force Main Replacement: The sanitary sewer lift station located on Ocean View Drive by Agate Beach State Park takes wastewater from all of Newport north and east from this station. During the winter months, the Big Creek Lift Station regularly overflows because of inadequate capacity. This project will increase the size of the force main and pumps within the next two years to prevent future overflows.
* Water Main Replacement and Upsizing on Hwy 101 between NE 61st and NE 71st Streets: This project will increase volume for better fire protection and will replace aging water mains acquired by the city from the old Agate Beach Water System.
* Salmon Run Pump Station Relocation/Replacement: The Salmon Run pump station and water main was put out of service for several days during the winter storms in January of 2012 due to landslides. This project replaces the pump station that was built in the 1980s and moves it outside of the geologically unstable area.
* Yaquina Heights Tank Improvements: This project involves repainting the exterior and relining the interior of the tank, and replacing the safety rails on the top of the tank which have rusted away, making inspection of the tank impossible.
* SE Fogarty to SE John Moore Drive Storm Sewer Improvements: The storm sewer in this area is failing causing repeated sinkholes in the parking lot of the Embarcadero and storm sewer backups into Bay Boulevard.
* Bay Crossing Sewer Forcemain: In the winter of 2011 and again in 2012, the welded steel line that conveys wastewater to the Bayfront and then across the bay to the wastewater treatment facility failed at the welded joints causing wastewater the back up. This project is focused on repairing and or replacing this section of failing forcemain.
* Lower Big Creek Reservoir Drawdown Repair: The purpose of this project is to replace a corrugated metal pipe and gate that draws down the city’s water supply reservoir. This pipe was installed when the dam was originally constructed in the 1950’s and is close to the point of failure.
The rates collected as part of the city’s utility bills pay for these projects as well as operational costs associated with providing clean water, treating wastewater, and conveying stormwater. These projects represent just a few of the necessary improvements identified within the city’s long-term Capital Improvement Plan. These improvements are vitally necessary to keep clean water flowing and to protect public health through proper wastewater conveyance and treatment. Citizens having questions regarding the rate increases or the Capital Improvement Planning process, may contact the Public Works Department at 541.574.3366.
Phone service in Waldport was out for a while this morning after an equipment upgrade didn’t work. Much of the area’s phone service was disrupted for about an hour until they removed the “upgrade” and put the old one back in.
Phone service was restored around 10am this morning.
After much agonizing and trying to predict the future, then backtracking and trying to predict the voters, then returning to where they were at the start, the Newport City Council Monday night heeded the advice of their public works director and raised Newport water, sewer, stormwater, and utility infrastructure fees effective July 1st. Public Works Director Tim Gross, reminding the council that the city’s water and sewer pipes are 20 to 40 years overdue for replacement, said the city needs to raise enough revenue that would represent a doubling of resident utility bills to put the city’s utilities on a sustainable revenue track…effectively doubling over the next ten years. He said there may be special federal, state or other grants or low interest loan programs that might come along to lessen the strain on ratepayers. But any way you cut it, it must all add up to enough revenue to put the city utilities on a sustainable operations and replacement program.
So again, come July 1st, water rates will rise 15%, sewer 20%, Utility Infrastructure Fee 5% and a first ever stormwater fee will be levied at $6.80 a month.
During the debate, councilor David Allen urged the council to put a rather large general obligation bond to a vote of the people. That was tossed out by the rest of the council, they saying such broad based property tax supported bonds should be reserved mainly for very high cost items like major street construction, water and sewer plants. Councilor Sandra Roumagoux raised the question, “What if the voters turn you down, then what do you do? The work still must be done!”
Public Works Director Tim Gross said as time goes on and the city replaces more and more of its pipes, the city may be able to win various grants or low interest loans that might reduce future rate increases. But again, he emphasized that it must work out to $3 million a year in pipe replacement work; roughly a mile and a half of pipe a year, whether water, sewer or storm drain.
Gross reminded the council that the utility system challenge facing Newport is being played out in just about every American city. Their pipe systems were installed during the post-World War II building boom when huge tracts of homes were built, an interstate freeway system was constructed and the country was the economic envy of the world. Well, those same pipes are still in the ground and they’re rotting away and failing by the day. And each failure costs a lot of money to fix, only to see another part of the lines fail again.
Again, the rates go up July 1st. Gross says he’s going to make sure the city applies for every grant out there to help cushion the impact of future rate increases. But he lamented, “Right now there isn’t much out there due to the prolonged recession.”
Newport City Councilors will be a most unhappy group of folks Monday night as they consider a dramatic series of rate increases for anyone with a water meter on their residence. Rate increases of 15% for water, 20% for sewer, 5% for operations and maintenance and a first-ever storm water charge of $6.80 a month will be on the table for discussion and action.
The move comes after it was reported by City Public Works Director Tim Gross that the city’s sewer and storm water systems are old and need replacing as well as expanded. The city’s water distribution system is frail and failing, says Gross, and also must be expanded with a new water line along SE 101 from 40th to 50th Streets, an upper Big Creek Lake Syphon, and a major new water tank for Agate Beach. However the Agate Beach Tank and 40th to 50th street boring projects will be funded largely by fund transfers and higher system development fees charged to new building projects. The new tank is currently under design and its construction will begin in the near future. The city’s brand new water treatment plant is nearing completion and will be brought on line also in the near future with higher quality water than ever before.
Gross contends that Newport’s water, sewer and storm drain distribution systems are no different than in cities and county’s around Oregon, if not the country. He said there are water and sewer lines crumbling from one end of town to the other, and they’re fixing them from one end of town to the other. Gross says they’re repairing them with money that should be going to replacing them – not just fixing them only to see them fail somewhere else along the line.
Gross says Newport must begin replacing all this to the tune of $3 million a year. Gross claims the city needs to replace up to a mile and a half of pipe every year for the foreseeable future. He says a 50 to 60 year replacement cycle is about what it works out to. He says that is the life cycle of underground pipes in rainy, high groundwater coastal Oregon.
Gross informed the city council that these stiff rate increases may not have to be the only source of revenue for such an ambitious ongoing project. There could be low interest loans, federal and state grants, or special funding arrangements not yet contemplated, that might eventually kick in. If they do, then rate hikes could be leveled off or even reduced and still get the job done. But he lamented “that’s not happening yet. There’s very little financial help out there.” But he says, something has to be done and done now. Gross says Newport’s utility line problems are getting so bad that he can’t guarantee that the town’s fire hydrants will be able to deliver sufficient water if a bigger-than-average building fire broke out. He also points out that cities and counties can no longer allow aging sewer systems to allow raw sewage to pour into our local bays and rivers and onto our beaches. Gross says fines for that sort of thing are are going to be very high after looming tighter discharge restrictions take effect.
If agreed to by the city council, here’s how the new water, sewer and storm drain rates could look like starting July 1st. For a 3/4″ inch water line to a home it would be $16.45 a month for the first thousand gallons with a $3 surcharge per thousand gallons after that. For those outside the city, the rate would be $31.40 plus $4.95 per thousand gallons after the first thousand. For a 1″ water feed in town, $22.60 for the first thousand gallons, then $3 per thousand after that. For a one 1″ water feed outside the city, it’s $42.75 a month for the first thousand gallons, and $4.95 per thousand gallons after that. For a 2″ water feed for inside the city it would be $56.95 for the first thousand gallons, then $3 per thousand gallons after that. Outside the city for a 2″ line the base rate would be $104.75 for the first thousand gallons and $4.95 for each thousand gallons after that.
On the sewer side, for a single family home the new rate would rise to $18.45 base service, with a charge of $5.30 per thousand gallons. For multi-family buildings and commercial businesses, it would be $18.45 for the basic service and $6.05 per thousand gallons. Those who bring their sewage to a dump station, the rate will be 30-cents a gallon.
On top of all that is a 5% increase in the city’s operations and maintenance fee. So, for a 3/4″ water line it’s $5.95/month. For a 1″ line it’s $11.90/month, for a 2″ line it’s $41.75/month and for a big 5″ water line it’s $381.55/month.
Gross is proposing (after long discussions and a number of public hearings) that a monthly storm water fee of $6.80 per month be levied on any dwelling or business with a water meter. During the last city council meeting the frequently mentioned allegation was made again that small home owners should not be subsidizing the Walmarts of the town that have much bigger paved areas than homeowners do. Gross and the city council responded that a lot size and percent of impervious surfaces is an over-complicated analytical tool for figuring out who pays how much for storm drains. They say that the overwhelming amount of storm water comes from city streets and highways which everyone in town uses whether going to and from work, for the delivery of goods and services to homes and businesses, public transit, bus transportation for school children, recreation or a host of other reasons people drive or ride about town. He said the extra storm water from big box stores with large parking lots is literally a drop in the bucket compared to the public’s road surfaces. That observation will likely be heard yet again Monday night during the council meeting
A number of residents are also expected to testify Monday night that they just don’t have the money, and won’t have the money, for what will soon be, within five years, the doubling (or more) of their water, sewer and storm water bills. During the last council meeting it was discussed that the city might set up a separate fund for those who qualify for assistance from other citizens willing to pay a little extra on their own bills so that low income residents can get a discount.
All this gets underway Monday night at Newport City Hall, beginning at 7pm. That’s the exact time set for the agenda item dealing with the rate increases.
Newport’s water and sewer rates are looking more and more like they’ll start rising rapidly every year for the next five to seven years to allow the reconstruction of both systems literally from the ground up. Newport Public Works Director Tim Gross told the city council Monday night that while his public works crews work hard to keep the system going, “it’s just so old that there’s a limit to what they can do unless the pipes in the ground are replaced; some of them dating back to the 1920’s and ’30s. Gross said on top of that, the city needs to also get serious about upgrading its storm drain system.
The bottom line: Sewer and water rates will rise substantially over the next five to seven years (double digits), and then rise five percent a year after that to cover ever higher costs for operations and maintenance.
In addition, Gross is proposing a nearly seven dollar a month storm drain fee be added to our monthly utility bills. As has been stated throughout public discussions on water, sewer and storm drain challenges, Newport’s underground pipe system is badly decayed in many areas of town. It’s going to be expensive to replace them, or in some instances, install them in the first place. Gross said that, in the past, there were federal and state funds to help local communities upgrade sewer and water systems, but those funds, for the most part, are no longer available.
If city councilors go along with the plan, and most seemed to indicate they would, combined sewer and waters bills for a typical Newport family would rise, over the next 10 years from today’s $67/month up to $165.77/month. A woman in the audience walked up to the witness bench and said she could never afford those rates and strongly urged the council to find other sources of money. She also chided the city council for, what appeared to her to be, councilors embarking on a one-way trip to breaking the budgets of many households in the city.
In the end, councilors agreed to take up the matter at their next regular meeting next month, this in an effort to give the public time to chew on what some call a giant betrayal of previous generations who used up the sewer and water systems yet didn’t pay hardly anything toward replacing what’s already in the ground.
Gross said full details of the city’s range of options for rate increases can be found in his report to the council, now online at the city’s public works web site. Click here.
As for the $6.80/month storm drainage fee, Gross said he would like to see that instituted as soon as possible. The council takes all this up again at their first meeting in June.
It’s probably the city council meeting that every Newport city councilor has been dreading for months. A meeting when Public Works Director Tim Gross gives the council a reality check on the “State of the Pipes” in Newport. And the news wasn’t good. In fact, it was down right awful.
As readers of News Lincoln County know well, the city of Toledo is faced with having to replace everything from river intake to sewer mains. Roll that picture west down Highway 20 to Newport, and repeat the observation. Pipes in Newport, put into the ground in the 1950’s, are decayed and worn out like those in Toledo. Gross says to ensure reliable water and sewer service and a workable storm drain system, Newport needs to replace nearly 200 miles of pipes that hook to water and sewer treatment plants, which themselves, are still in good shape. However, the sewer plant will be needing some expensive upgrading in the near future. There are also another 100 miles of storm drain pipes that have to be replaced.
But the issue is what will happen to sewer and water rates for Newport residents and businesses over the next five to ten years to begin “paying forward” the bill for new water and wastewater treatment plants and sewer pipes and the pump systems that go with them. The council asked Gross what he thinks he’ll need for a revenue stream to do it. His response was “It depends on how fast you want to replace the pipes and whether we get a major system failure that throws the plan off schedule. I’m looking for rate hikes for water and sewer, and that’s not counting storm water. The system we have now is well beyond it’s life expectancy and it’s failing.”
Rather than agree to any specific rate hike, the council asked Gross to sharpen his pencil and develop a plan on how much money he’ll need to be raising annually to stay up with replacement costs.
Gross said that many communities in Oregon are facing the same dilemma. A big infrastructure push following World War II and into the early 1950’s was the last major infrastructure work during the last century. Now, more than a decade into a new century, all those pipes, plants and pumps are failing. All those decades of neglect are coming home to roost. And it’s going to cost a lot of money just to rehabilitate Newport’s sewer and water service.
A visibly uncomfortable city council suggested raising rates 5% a year but Gross told them, “I need five percent a year just for the rising cost of operations and part of the system maintenance cost. At five percent you won’t be putting any money into replacing a system that continues to decay in the ground.”
Gross said that the dilemma is common across the country. People have not been told they have to eventually replace their entire system, even though the obligation was always there. Nothing lasts forever. Gross said he will be spending the next two weeks coming up with a plan to raise $1.5 million a year in water pipe and pump replacements, and another $1.5 million in sewer pipes and pumps. The council suggested borrowing money up front to soften the initial blow of the rate hikes. But Gross reminded the council that the rate must produce a revenue stream that “pays forward” the cost of pipe and pump replacement.
Gross says whatever the new rate hike schedule the council agrees to, whether it’s 20% for year one, 15% for year two, 10% for year three, and so on, it must raise about $3 million a year for system component replacements. An additional 5% per year rate increase is needed just to cover the costs of operation and maintenance inflation.
So, we’ll see what Mr. Gross comes up with during the first council meeting in May.