Council to Bring Back Proposed Sewer Rate Increase Next Month

The City Council voted on Monday to bring back a proposed rate hike to the sewer use fee rate to May 6.

But when the item comes back to the Council, it will include more models and how they impact residents, as well as details on how additional proposed rate hikes to water and refuse will also impact residents. The proposed hike would raise the average monthly sewer use fee from $4.55 to $11.37, marking the first time the City has suggested an increase beyond the consumer price index since 2007.

However, since the 2007 increase, the City has struggled with aging infrastructure in the sewer system and has delayed capital improvement projects to try and keep basic operations underway. The increase would go into effect in 2025.

“Water is going to have a potential increase, power is definitely going to have an increase, and refuse is going to have a potential increase,” said Councilmember Tyron Hampton. “Locals are reducing water, and Pasadena Unified School District passed a bond which is a property tax on top of that. To hit our residents with increases like this in multiple ways. It seems punitive. I think it is extremely steep and I think they are needed, but I don’t think the first year should look like this. I can’t support the increases.”

Hampton said the increases in all the utilities combined could cost some families hundreds of dollars.

A public hearing to establish increases in the refuse rates will also come back. Each dollar increase by local residents would lead to $700,000 annually in revenue but the City needs about $4 million, which is why it needs the huge increase.

Councilmember Steve Madison questioned Pasadena Water and Power’s use of its budget. The Council approves the budget, and departments are required to come back to the City Council for budget amendments.

Madison said the department’s numbers were not adding up. Madison emphasized monies were supposed to be in the required account.

In correspondence to the City Council, local residents said they opposed the rate increases.

“The rate increase is more than being doubled the first year [for example from $4.55 currently to $11.37] which is an astronomical 150% increase plus another approximately 16% per year for the remaining 4 years,” said John and Donna Otoshi. “This is not an acceptable plan for a rate increase to your residential customers. We understand the need for increases based on rising costs, but please go back and come up with a new rate structure that does not hit the customers with such [a] dramatic increase. Perhaps something in line with an increase of 10% per year for the next five years but your increase will need to be re-evaluated and reproposed.”

But rental property owners said they were victims of the increase due to Measure H, the rent control initiative.

“As Pasadena is now under rent control, I think it is unfair to increase the sewer usage rates at a time when cost increases cannot be passed along to the tenants,” said local property owner Modestos Kefalas.

Owners of rental properties called on the City to pass the increases on to developers building projects in the City.

Other property owners said the increases come at a time when they will be required to pay much higher insurance as several insurance companies are no longer offering insurance to homes and rental property in California.

The City-owned and operated sewer wastewater collection system, serving approximately 140,000 residents and commercial users, is currently funded by the Sewer Use Fee. This fee, part of customers’ utility bills, is used for the operations, ongoing maintenance, and needed capital improvements of the sewer collection system, which consists of 325 miles of sewer pipelines, three pump stations, and nearly 7,500 manholes.

To fully fund the sewer collection program, the City needs approximately $7.6 million every year.

However, the City currently collects only $3.9 million on average each year. The current sewer use fee is based on the consumers’ water use, which is considered to be proportional to the sewer system’s wastewater discharge. That methodology has been used since the establishment of the fee.

The long-term statewide drought conditions and water conservation efforts have impacted the amount of sewer use fees collected over the last ten years, and as a result, the City has not kept up with the cost of maintaining Pasadena’s aging infrastructure, according to a City staff report.

The fixed charges include 52% of collection-related costs that are fixed and do not vary with flow.

The proposed rate for single-family residences is a fixed monthly rate of $6.16 plus a volumetric rate of $0.65 per hundred cubic feet. Single-family residence water use is capped at 26 hundred cubic feet per month, which assumes that water usage above 26 hundred cubic feet is for irrigation and therefore does not go into the sewer collection system.

However, the utility cost index has almost doubled since 2020 compared to general inflation increases and continues to rise. The cost of maintaining the sewer collection system has increased significantly.