EDITOR’S NOTE: This story has been corrected to reflect that The Bonneville Power Administration adjusts its power rates to the city of Port Angeles every other year.
PORT ANGELES — City Council members in a work session Tuesday will reconsider 2015 utility rate increases that are part of a five-year plan that would see average residential users pay $936 more per year by 2019.
Average commercial rates for all utilities would increase $1,843 in five years, under the plan.
The work session at 5 p.m. in council chambers at City Hall, 321 E. Fifth St., will focus on monthly hikes in 2015 that would equal a $182 annual increase (rounded off to the nearest dollar), or a 7.1 percent, in average residential electric, water and wastewater rates.
Commercial rates for those utilities would increase an average of $191 annually, or 5.2 percent, for 2015.
The council rejected the proposed 2015 increase last Tuesday on a 4-2 vote after hearing vigorous opposition from eight residents who said the increases would be too burdensome on low-income ratepayers.
But the council decided it would go over the proposed hikes again this Tuesday.
The 2015 increase would be the first step of a five-year plan to recoup the cost of service for electric, water, wastewater and stormwater utilities, city officials say.
Each year’s increase would have to be approved by the council.
Five years of planned hikes would lead to an average $936 overall increase from the present rates in residential electric, water, wastewater and solid waste utilities for residential users and even more for commercial users, according to estimates presented by the city Public Works and Utilities Department.
In an interview last week, Phil Lusk, deputy director of power and telecommunication systems, said he was unaware of the five-year impact of the increases on ratepayers.
The five-year plan is an acknowledgement of the likelihood that the Bonneville Power Administration will continue to increase its power rates to the city by about 10 percent every other year, said Craig Fulton, city Public Works and Utilities director.
“These are our best projections,” he said.
“They could be higher; they could be lower. I’m hoping they’re lower.”
Councilman Brad Collins, who voted for the 2015 increase at Tuesday’s meeting, said he, too, was unaware of the five-year plan’s cumulative impact on ratepayers.
“I think it’s very difficult for people to manage those kinds of increases, which is why I haven’t supported rate increases in the past,” Collins said.
“For this one, the 2015 budget needs to move forward.
“The city administration is doing all it can to minimize the rate increases.
“I anticipate I would continue to support the recommendation of the administration as it was presented to us on Tuesday.”
He added: “What is in place today that was not five years ago is, we have much stronger council support for low-income households that are struggling to pay this kind of rate increase.”
Deputy Mayor Patrick Downie, who also voted for the rate hike Tuesday, said he is not yet committed to voting for the 2015 increase once it comes up again before the council before the end of the year.
“We must come up with a more comprehensive program that reaches a larger segment of the population of ratepayers, whether they be seniors or low-income or whomever they are,” he said.
But rate increases may be inevitable, he added.
“If Bonneville is continuing to raise wholesale rates, it is not prudent, it is not appropriate, for the city to basically create an unsustainable model where we are not accounting for the real cost of that service,” Downie said.
“My attempt on Tuesday will be to try to find an equitable, predictable, consistent five-year plan that can first deal as effectively and with sensitivity to those among our ratepayers who need a way to pay the bill.”
At their meeting last week, council members did not discuss the cumulative impact of five years of rate increases on ratepayers.
The council already has an average 2015 residential solid waste rate increase of 5.45 percent, or $1.11 monthly, and an average increase in commercial solid waste rates of 10.75 percent, or $2.89 monthly.
Along with equalizing the cost of service, the utility hikes also will cover costs of improving utility infrastructure, rising electricity costs and the large-scale environmental projects the city is facing, according to an analysis the Seattle-based FCS Group presented to the council in April.
The city will have to spend at least $57.5 million over the next 20 years for environmental projects alone, including reduction of sewage flows into Port Angeles Harbor and keeping the city’s closed bluff-top landfill from releasing garbage into the Strait of Juan de Fuca.
The increases also are meant to address what city officials say is the subsidizing of some ratepayers by others.
Residential customers now pay more than the true cost of what it takes to provide water and wastewater to residents, FCS Group said, while commercial customers are paying less than it takes to provides them with water and wastewater.
The opposite is roughly true for residential and commercial electric customers, according to the FCS analysis.
Fulton said solid waste rates could go down over the next five years if the state Legislature gives the city additional money for the $19.6 million landfill bluff-stabilization project or if it comes in under budget.
It doesn’t make sense to stretch the five years of increases over 10 years, Fulton added.
“If we collect it later, all we’ll be doing is playing catch-up,” he said.
“We’ll delay doing projects.
“Piping will get worse, and we’ll have to do more pipe replacements, more pump replacements, later on.”
The city has made attempts to lower costs to ratepayers, he added.
For example, the telecommunications charge for the city Wi-Fi system has been moved out of city electric bills and is now covered directly by Wi-Fi users.
“We are drastically cutting back on vehicle replacement to, again, reduce the cost impacts to each utility,” Fulton said.
Also, the council last Tuesday scrapped a $4.50 monthly harbor study surcharge that cost residents $54 a year.
Ratepayers having difficulty paying their bills can take advantage of city weatherization and heat-pump programs, Fulton added.
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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 5060, or at pgottlieb@peninsuladailynews.com.
