Increase in San Luis utility fees approved
San Luis, Ariz. — In order to improve city finances and to meet their financial obligations, the city council approved on Wednesday an increase of $5.97 to public services for city residents.
The proposal presented by city administration was approved by the majority of council members, with the exception of Mayor Juan Carlos Escamilla and Council Member Rafael Torres who were not present during the session.
Council Member Mario Buchanan Jr. conference-called his vote in favor of the increase.
The decision made by council members will increase the city's funds, under which services are managed, to $400,000 more per year by increasing water, trash, and sewer fees.
City water fees will increase from $7.95 to $9.06, sewer fees will be above $17.79 and trash collection will go from $11.95 to $13.82.
The new proposal includes an environmental fee of 50 cents per month in order to finance an annual clean-up campaign.
Overall, public services will go up from $37.69 to $43.66 as of September 1.
Olivia Jenkins, Public Services supervisor, who stated that the current water fee has been the same since 1989, presented the proposal and said that as the city has grown so have costs.
Jenkins said that as a San Luis resident she experiences the same problems that afflict any other resident, and that there's a need to improve services and dismissed the argument that San Luis is considered a poor community, with a large number of farm workers that make it necessary to keep fees low.
“Farm workers also live in Somerton and Yuma and when fees are increased, they pay. We have kept fees low for a long time and it is time to take action,” she said to council members.
She was supported by the City Attorney, Glenn Gimbut, who pointed out that those funds must be self-sustaining and should not need to be subsidized by other funds
“If we continue to lose revenue, it will be devastating,” he said.
The adjustment to public service fees was one of the requirements in order to receive funds from GADA (Greater Arizona Development Authority) in 2008 for $18 million.
“Our commitment was to meet this requirement by July 1 and with board approval the new fees will go in effect on September 1, two months after the due date,” he said.
The loan agreement states that the city must balance their funds by July 1, 2010.
Not meeting these obligations would expose the city to a lawsuit in which the court would order that fees be increased without the city being able to do anything about it, Gimbut said.
He added that not meeting the loan agreement would expose the city to lawsuit from those who bought bonds to obtain the loan and would lower the city's credit rating.
John Starkey, Public Works Director, said that resources are need to improve the water infrastructure since the current service is at capacity and anticipated drainage coverage is not viable until the water treatment plant expansion takes place.
In 1989, water fees were set at $7.95 and were increased to $12.25 in 1996. But in 1997, the city council reduced it back to $7.95.
In 2004, the new council approved an increase to $9.62 but two years later, they approved a reduction to $7.95.
Sewer and trash collection fees were last increased in 2004.
Council members voted in front of a public audience where only one person, Javier Barraza, spoke to the board to ask that they consider water quality when developing new residential areas.
The board's approval of the fee increase was followed by applause from the public.
Group opposing proposal may begin referendum
San Luis, Arizona – Hours after the board approved the utility fee increase, David Lara announced that a referendum opposing the proposal is being considered.
On Thursday, Lara confirmed that former council member Carlos Bernal, through the group Residents in Defense of the Town, may use a referendum to stop the fee increase.
“The lack of funds for public works and the risk of the city being sued are a result of poor planning and the irresponsible actions of the council. The residents shouldn't have to suffer the consequences,” Lara said.
The group may begin the referendum process next week by registering the application and begin to obtain signatures.
Two hundred and eighty signatures are needed in order to begin the referendum process, which would take the decision to increase fees to a public vote in the November 2010, or the March 2011 elections.