ZEPHYRHILLS — Utility customers should soon receive notice of the city's intent to raise water and sewer rates by 10 percent, which could add about $3 to the monthly bill of a single-family home using 4,000 gallons of water.
The city must notify customers at least 30 days before voting on the proposed hike, so it will be at least six weeks before the matter lands on a City Council agenda, City Manager Jim Drumm told council members at their regular meeting Monday. If the council approves the suggested increase, customers will see the 10 percent boost for the next three years and then 5 percent annually for two more years.
The council first discussed a possible increase last year, hiring a consulting firm to conduct a rate study. Zephyrhills has the lowest water and sewer rates in Pasco, as well as Hillsborough, Pinellas and Polk counties, and will continue to hold that position even with the rate increase, said Andy Burnham, senior vice president of Burton & Associates, the firm that conducted the study.
Current rates only bring in enough money to cover utility operating and maintenance costs and debt repayments, but the city needs another $43.5 million for capital improvement projects necessary to maintain and improve equipment, the study found.
For instance, the city has about 300 miles of water lines that were installed when the system was created in the 1920s and another 300 miles of sewer lines that date back to the 1950s, said David Henderson, utility director. The pipes have never been replaced, he said, and the city is losing several hundred thousand gallons of water each day because of leaks.
Of four options presented to the council, the one recommended by Burton & Associates is estimated to raise nearly $25 million over the next 10 years — not enough to cover all of the desired capital improvement projects, Council president Ken Compton pointed out.
Burnham agreed, but said the city should take a balanced approach and that the suggested option was a good first step. One of the options, which would bring in an estimated $49.6 million over 10 years, would require a monthly rate hike of about 27 percent for the next three years and then 5 percent for the following two years. That would mean a customer using 4,000 gallons of water a month would see their monthly bill go up about $8, the study said.
The firm also is suggesting the city change the way it sets rates for mobile home and recreational vehicle parks, and multi-family residential units, which currently get charged the same base rate per lot or unit as single-family homes.
The study proposes scaling the monthly fee with a ratio based on the highest month of use — which could help a mobile home park using 500,000 gallons of water a month save about $250 on its monthly bill.
Council member Charles Proctor, who owns a carwash, said the last thing he wants to do is raise utility rates. But he knows it's necessary to sustain the system, he said.
"It's just common sense," Proctor said.
In other business, the council:
• Approved a roughly $198,000 contract with the architecture firm Harvard Jolly for a library expansion project, budgeted for $1.5 million.
• Accepted a sustainability plan from Vrana Consulting Inc. that outlines ways the city can be more energy efficient, or "green." The plan, paid for with a Department of Energy grant, is based on input gathered from a series of community workshops. It suggests projects such as a community garden and making streets more bicycle and pedestrian friendly.
• Directed city staff to look into the possible purchase of property at 5542 20th St., which would allow for the expansion of an adjacent retention pond to help alleviate flooding at 20th Street and Seventh Avenue.