March 7, 2012
Because of years of planning and long-term financial management by Mayors and City Council members, City Manager David Cavazos is recommending no increase for combined water and sewer rates in 2012.
"Phoenix has a safe and reliable water system thanks to the hard work of my colleagues on the City Council and the City Manager," said Mayor Greg Stanton.
"We now are in a place where the combined water and sewer charges for our customers will not increase this year. That is very good news during these challenging economic times," he said.
The reason customers will see no increase, and could see a slight decrease in their combined water and sewer rates, is because of innovations, efficiencies and strategies that have helped save the Water Services Department millions of dollars.
"We gave city management direction after last year's water rate increases to do all that they could to have very little or no rate increases for our residents in 2012. They certainly have met and exceeded that challenge," said Councilwoman Thelda Williams, chairwoman of the City Council Transportation and Infrastructure Subcommittee.
Included in the innovation and efficiency saving are:
- The City Council voted in November 2011 to reduce the Jail Excise Tax by 50%. Customers will realize a 50% reduction on their City Services Bill, Jail Excise Tax line item, beginning in July 2012. The amount of tax paid depends on water meter size; approximately 88% of accounts will pay $1 less per month, while the savings will be greater for customers with larger residential, commercial and industrial-size meters.
- Identified $14.5 million in annual savings and efficiencies in the recent Water Efficiency Study, conducted by an independent consultant, and other actions by the department, including eliminating 25% of Water Department management positions and reducing 39 additional positions.
- Reduced five-year Capital Improvement Program by $263 million in 2012.
- Utilizing AAA credit rating to reduce debt service through refinancing by $43 million over the next three years.
- Generating $4.5 million per year by selling reclaimed water to Palo Verde Nuclear Generating Station; $30 million in savings regionwide over four years.
- Saving $1.4 million a year by closing the Verde Water Treatment Plant.
- Continuing to collect $5 million a year with new late payment fees program.
"Because of the leadership of the Mayor and City Council, and the outstanding work by dozens of community and business leaders who volunteered to serve on our water advisory panels, I am pleased to present this good news to the community," said City Manager David Cavazos.
"We are doing all we can to reduce or not raise fees and rates for our residents, and this is another example of being able to accomplish this goal," he said.
The City Manager's recommended combined water and sewer rate adjustment of zero (4.5% water rate adjustment; -7.5% sewer rate adjustment) will be discussed at the March 13 City Council Transportation and Infrastructure Subcommittee.