Proposed stormwater utility rate increase is gradual, but is it enough?

The City of Newton’s first attempt at increasing the stormwater utility rate did not make it past the first reading last month. The city’s second attempt last week received more support from council members and has two more readings before it can be adopted, though some still wonder if it is really enough.

Currently, the stormwater utility rate is set at $4.50 per equivalent residential unit (ERU). In most cases, homes in Newton are set at one ERU. When the original increase was introduced back in June, it would have increased the rate by 5 percent every year for five years, starting at $4.73 and ending at $5.75.

However, council members on June 17 had disagreements over the original rate increase and whether it was fair to businesses, nonprofits and churches, who would naturally have more ERUs and thus a higher bill. The matter ended in a 3-3 vote and could not continue, prompting city staff to reevaluate its proposal.

Two new options were presented to council at its July 1 meeting.

According to city documents, the first option would be to raise the stormwater utility rate by a flat $0.25 for five years starting on July 1, 2025. The other option would be to increase it by 6 percent starting in 2025, then 4 percent in 2026 and 2027 and then 3 percent in 2028 and 2029. Council decided on the second option.

By the end of the five years, the second proposal would see the ERU rate increase to $5.47 while the first option would increase to $5.75. Of note, the first option’s fifth year rate of $5.75 is equal to that of the original stormwater utility rate increase of 5 percent per year for five years.

Council member Randy Ervin, who has been outspoken about the stormwater utility rate increase, motioned for the second option because over time it was the least expensive. Although he agreed the city is behind on its stormwater solutions he wanted to help out businesses who would be paying more.

Newton Public Works Director Joe Grife said in June the maximum a commercial property or exempt property would be charged at the current rate is $180 per month.

Council member Joel Mills, who voted in favor of the original rate increase and had even proposed the $0.25 increase, considered the new options a sound starting base to a problem that is decades old. He is confident the change will give the city a good foundation to move forward. But more will be needed in time.

“In three to five years we need to be taking a look at how much more we need to add to this,” Mills said. “And it will be more in three to five years. When this sunsets, we need to have a sound plan. So let it be known to be everybody that we need to have a sound plan in year three because this is going to sunset.”

Ervin mentioned that council can always increase the rate more should the need arise. Mills agreed. If the city continues to see more floods like the ones that took place on May 21 this year — which resulted in a presidential disaster declaration — then the council is going to increase stormwater utility rates, Mills said.

Other council members were not sure if either option gets the city where it needs to be concerning its stormwater utility infrastructure. Council member Steve Mullan worried inflating costs could hinder any real progress the city is attempting to gain. Council member Stacy Simbro shared similar concerns.

Mullan asked, “Is it possible to change this as we go along and we find out we’re getting way behind?”

“We already are way behind,” Simbro said.

Businesses have time to plan for any upcoming changes to the stormwater utility, Simbro argued. While he is sympathetic to nonprofits, he said those groups have other benefits. Entities like churches, for instance, are exempt from paying property taxes. Residents need stormwater improvements, Simbro said.

“We’re behind. I’d still contend going down each year doesn’t make a lot of sense,” Simbro said.

Ervin agreed the city is behind, but he argued an increase should be gradual.

“We are way behind in this game,” Ervin said. “…But this wasn’t even an issue five years ago. This is all brand new from the time I’ve been on the council. So somebody at that point had to start this process. And now we have an opportunity to increase it, and I think we should do so, but at a moderate rate.”

Mayor Evelyn George claimed stormwater utility was discussed by council years before it was ever established. But it just took that long to get enough council members to approve the implementation of a fee onto residents’ utility bills. Other comparable cities have charged residents a fee for a considerably longer time.

Ervin said either way it is likely city council members agree they need to walk away from the meeting with something. Council member Melissa Dalton is on board with the increase, but she does not know if the 3 percent the final two years is enough, particularly when the planned projects are millions of dollars.

“I mean, the first one is $7 million,” Dalton said. “So coming in at a 3 percent increase, I just don’t like it—I mean, granted it’s pretty similar, but the 3 percent doesn’t seem like it’s going to touch any part of those projects. The lowest priced project isn’t even what we brought in annually.”

The city council passed the first reading to adjust the stormwater utility rates for the next five years in a 5-1 vote. Simbro voted no.