Friday, May 30, 2003 | 9:31 a.m.
By September 2005, the average North Las Vegas water and sewer customer's monthly bill would be almost double its current amount under proposed rate increases the City Council is scheduled to consider June 18.
The increases proposed by city staff would be phased in with rate hikes Sept. 1, and the two following Septembers. Sewer charges would increase more than water rates, under the proposal that would raise water rates for the first time in seven years and sewer rates for the first time in 10 years.
The rate increases would bring revenues up to costs for water and sewer operations, officials said. Without the increases, the water and sewer funds would continue to drain reserve funds, they said.
The increases would also be expected to encourage some water conservation.
The City Council is scheduled to hold public hearings on the proposed rate increases 6:30 p.m. June 18 at City Hall. A council vote on the proposed increases could come after those hearings.
The average city water and sewer residential customer pays $37.32 a month based on using 14,000 gallons of water. That customer's monthly water bill is $23.98, and their sewer bill is $13.34, according to city documents.
Under the proposed rate increases, that average customer's monthly bill would increase to $49.99 after Sept. 1, $60.69 the following year and $71.80 in 2005.
The $71.80 bill would include a $38.38 charge for water and $33.42 for sewer.
The increases would take effect on Sept. 1 of each year, which means customers would see the rate hikes reflected in bills they receive in October.
The larger increases on sewer bills would be the result of the city switching from a flat sewer charge for residential customers, which is now $13.34 a month, to a use-based rate that would be capped at $33.42 a month after Sept. 1, 2005.
City Assistant Public Works Director David Bereskin said about 70 percent of the utilities' customers use 14,000 gallons of water or less every month.
The proposed rate increases are less dramatic for the roughly 37 percent of the utilities' customers who use an average of 5,000 gallons of water a month.
Bereskin said those are probably elderly customers who are typically light water users. Their monthly bills would increase by almost 52 percent after September 2005.
Those customers now pay $26.34 a month, which is $13 for water and $13.34 for sewer.
Their monthly bills would increase to $28.85 after Sept. 1, $34.38 in 2004 and $40 in 2005, officials said.
The differing rates of increase would be due to the city continuing to use a tiered billing structure under which the more water one uses, the more expensive those additional gallons are.
North Las Vegas has about 52,000 water customers, roughly 47,000 of whom are residential. The city's water customers include residents of Sunrise Manor, a residential development adjacent to the city's east border that is an unincorporated part of Clark County.
The city sewer system has about 36,000 customers, including about 34,700 residences. All of the city's sewer customers are within the city limits.
Without the proposed increases the city's water fund is projected to have revenues of $35 million and expenses of $43 million during the fiscal year beginning July 1. The shortfall would be covered by drawing down the fund's reserve funds to about $3 million, which would be reduced to zero by the 2005-2006 fiscal year, according to city documents.
"This is a scenario that just cannot happen," said John Gallagher, a vice president with Black & Veatch, which was hired by the city to study the city's water and sewer rates.
Financial projections based on the rate increases taking effect July 1 show the water fund bringing in $40 million during the same year.
The subsequent rate increases would continue to increase revenue until it surpassed costs during the 2005-2006 fiscal year. Projections showed that during that year water revenues would be $56 million and expenditures $53 million.
Projections based on rate increases coming in September instead of July have not been completed, Bereskin said.
On the sewer side, without rate increases revenues during the 2003-2004 fiscal year would be $13 million, while expenditures would be $19 million.
With the rate increases, revenues climb during the coming years and will equal expenditures of $27 million in the 2005-2006 fiscal year.
Those projections were also based on rate increases being implemented in July instead of September.
While some proposed rate increases have been expected for months, exactly how much those increases would be was made public for the first time Thursday prior to the meeting of the city's Utility Advisory Board. The 10-member board will make a recommendation to the council on the proposed rate hikes.
The board did not act on the proposals Thursday and is scheduled to meet again on June 12.
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