There will be winners and losers if Prince Rupert City Council adopts a bylaw to base its sewer rates on water consumption.
Some hotels could see a decrease in sewer rates when the economy is slow, said Chief Financial Officer Dan Rodin, yet other businesses with higher water consumption, could see an increase.
And because homes aren’t presently metered, taxpayers would absorb an increase in flat rates to balance out a possible decrease in revenues from the commercial sector.
The residential rate increase would come on top of an already proposed 5 per cent increase in water and sewer rates for the next three years.
For several months, City Council and Staff have been discussing whether to change the way sewer rates are calculated in Prince Rupert for commercial customers.
Rodin said having water and sewer levies that are related to actual usage would make the utility fee structure more readily understood and realistic.
“The flat rate fees result in a complicated calculation process which requires correct classification of the consumer and often subsequent analysis of the size of the consumer’s business to ensure the correct number of units are assessed,” Rodin said. The calculation gets more confusing when any part of a building is changed and the rates need to be altered, he added.
It’s a change that Anchor Inn proprietor Frank Zdralvje believes makes sense. He, along with some other hotel owners, has been advocating that the City base its sewer rates on water consumption.
He was back again Monday evening and told council he has been overcharged $6,000 a year since he opened his businesses eleven years ago.
“I am being overcharged by 400 per cent. The small businesses have been subsidizing the residential for a very long time,” Zdravlje said.
He is proposing the homeowner rate be increased from $300 a year to $327.17 a year to balance the city’s sewer budget while giving relief to the commercial owners.
“There would be a $2.26 raised amount a month. That amount is about the cost of a cup of coffee. I do not think the residents would be against it when we have to pay all equal shares as part of the service,” Zdravlje suggested.
In response, Mayor Jack Mussallem expressed concerned for the commercial sector downtown.
“These shifts will represent a hardship for some. I believe council should do things in a balanced way,” the Mayor said.
Council and Staff also debated whether to phase the changes in over three or five years if they go the “water in, water out” route.
“The question is what’s fairer for the largest number of people knowing that some people are going to get hurt. It’s going to be a difficult choice,” said Rodin.
In the end council didn’t make any final decisions on whether to change the way sewer rates are determined, deferring that to the next council meeting.
They did pass two separate motions to adopt three-year fee schedules for proposed increases of 5 per cent for both water and sewer rates. Those motions will now proceed to bylaw amendments for final adoption.
Mayor Jack Mussallem opposed both motions, Councillors Ashley, Bedard, Gordon-Payne and Kinney were in favour, while Councillors Garon and Thorkelson were absent.
Councillor Sheila Gordon-Payne appealed to the public to share any concerns it may have about the sewer rates being based on water consumption.
“If there are residential homeowners or business homeowners that are going to be weighing in on this I would ask that they reach our staff sooner, rather than later so that our staff are able to deal with any additional information that might come forward so that we can get to a decision, perhaps at the next meeting,” Gordon-Payne said.