Rate Hike Flows Under Residents' Radar

By AMY BRISSON

In a City Council hearing on July 14, Councilman Frank Rizzo and the Committee on Transportation and Public Utilities criticized the Water Department for what they said was ineffectual advertisement of a proposed 31 percent increase in water cost rates.

“One of the things we were very disappointed with was the notification process,” Rizzo told the Local in a phone interview last week. “They spent $50,000 on an ad buried away in a part of the paper that few people read. Fifty thousand dollars and only 23 people showed up at the [public] hearings that were around the city. Obviously not a good representation of our population.”

Small ads for the hearings were published in the legal section of 10 Philadelphia papers, including the Inquirer, Daily News and the Tribune. But community groups and smaller papers should have been made aware of the hearings, said Rizzo, which were the only chances for the public to give statements concerning the increase in water and sewer cost.

The increase under consideration, which will take place over the course of three years, was initially a 43 percent hike proposed in May 2004. An emergency increase of approximately 13 percent was implemented in February. Since last year, the water department has reduced the total proposal by cutting out a $70 million plan to take over liability for lateral piping. These pipes, which run from houses to the street and can cost more that $2,400 to repair, will continue remain the responsibility of homeowners. An additional $17.5 million settlement from Bucks County and bond refinancing also contributed to the reduction.

While the current proposed increase is 31 percent (including the emergency increase), the actual rate and the date that it goes into effect will not be known until water commissioner Bernard Brunwasser announces his decision, some time in the next two weeks.

The Water Department has argued that the raise is necessary to balance the increased cost of providing services, as well as the loss of an $8 million state subsidy.

Lance Haver, city director of consumer affairs who spoke at last week’s hearing, told the Local on Monday that the public should be more active in demanding that the water department find alternate ways of making or saving money.

“Whenever there is need for a rate increase, we should use that opportunity to bring people together to fight for what’s necessary and to use innovation to become more efficient,” he said.

Haver had many concrete ideas to offer the water department: combine water and gas meter readings, unite the water billing and the money collection department, and demand that the federal government provide funding for mandated post-9/11 water security measures. But the top priority, he argued, was to demand that the sheriff’s department release the $30 million collected at sheriff’s sales that is supposed to be returned to city utilities. The water department, however, is held back by structural problems that prevent it from making strong demands or improving efficiency.

The momentum will have to come from the community, said Haver. That is all the more reason why the water department’s poor hearing notification process is a concern, he added.

“They did not contact community groups, and I believe that was an error,” said Haver. “Unless we all work together, it’s very hard to get the federal government and the state government to provide their fair share for the city.”

The decision-making process included five public hearings and a week of technical hearings in March and April of 2005. Brunwasser told City Council that the July 14 hearing would not influence his decision because the record was already closed by the hearing examiner, Henri Marcial. But Rizzo speculated that they might still have an effect on the outcome.

“I believe that our hearing will have some influence on the commissioner,” he said. “The commissioner and his staff were very attentive to Councilman [Michael] Nutter and my concerns about the water rate increase.”

The issue of notification was not the only reservation City Council had about the proposed increase. Members were also concerned that the hike would be used as an excuse to add extra revenue to the city’s general funds.

Nutter, who is also the chair of the Transportation and Public Utilities committee, told the Local last week that he hoped the commissioner would settle for the minimum necessary increase.

“Certainly many Philadelphians cannot afford an increase at all, but costs do go up and I think we all understand that,” Nutter said. “So I think any increase should be the least that is required to maintain the system and ensure high quality service by the water department and security for our water supply.”

After the hearing, Rizzo had no doubt that the water commissioner would keep their concerns in mind.

“[The commissioner] is a very professional individual and I’m confident that politics won’t be a factor … it will be based strictly on exactly what the city needs to be compensated for water delivered from our citizen’s homes,” said Rizzo. “I have a feeling that before that announcement is made he is going to dot every ‘i’ and cross every ‘t’ to make sure that there is no fat in that rate increase.”

Rizzo added that the hearing had been recessed, not ended, and that after the commissioner’s decision, City Council would review the result and decide whether they have further concerns that need to be addressed through legal action.

(Use this link for PDF of the reservation form)