The City of Phoenix Water Services Department is facing criticism from city residents about a proposed 6.5% water rate increase and said that a top priority will be making sure that low-income residents of the city will get assistance to pay their bills.
The Department is requesting a water rate increase that will be dispersed throughout a two-year period and is considering different options for the rate increase.
This new proposal follows a 6% rate increase that was approved by the Phoenix City Council in January 2019 and went into effect Feb. 1, 2020. The income generated by this rate went into the funding for additional water supplies due to water shortages as a result of drought conditions affecting the Colorado River and record-high summer temperatures in the Valley.
Phoenix’s water supply primarily comes from the Salt River Project and the Central Arizona Project which transports water from the Colorado River to more than 400,000 people in North Phoenix.
Last week, the public hearing led by Eric Froberg, the Interim Director of the Water Services Department for the city, faced criticism from members of the public who questioned him about the need for an additional water rate increase.
“There was a 6% rate increase last year so why is it coming again this year?” said an individual who was not identified due to the virtual format of Webex.
The current water rate proposal is designed to fund a capital improvement program that rehabilitates and replaces pipes which have a 75-year life expectancy. In the 1950s, 600 miles of pipeline were installed which now translates to $1.7 billion in replacement costs.
During the public hearing, Froberg presented the three different options that the Water Services Department is considering for the rate increase. The first option which is a 6.5% rate increase for 2022 would delay about $100 million in funding for capital improvements because of a time lag related to the initial revenue increase.
“Option two would be a 3% rate increase this calendar year and a 3.5% rate increase next calendar year,” Froberg said. “This fully funds the capital improvement program and all projects would move forward as they had normally been scheduled. This is the option that the Water/Wastewater Rate Advisory Committee approved.”
The other prospective option would be a 3.5% rate increase in 2022. This plan would not provide the funding needed to replace the aging infrastructure and would cause finances to be allocated towards emergency projects. As Froberg said, this would shift the Water Services Department from a proactive to a reactive approach.
While the water rate increase will impact all residents the same, Water Dept. officials like Asst. Water Services Director Troy Hayes told the Council that the Department is taking measures to make sure that low-income residents in downtown areas of Phoenix will be able to pay their water bills.
“The city of Phoenix and the Water Services Department have set up assistance programs to help people,” said Assistant Water Services Director Troy Hayes. “If the rate increase or the bill that you have currently is a struggle then we have programs that are set up to help that.”
The Water Services Department is hosting a fourth public hearing on Feb. 18 which will be presented in Spanish and the last hearing on March 17 will be followed by a city council vote. If passed, the earliest the water rate increase would go into effect would be October of 2021.
Contact the reporter at eforquer@asu.edu.
Correction: A previous version of this article stated Eric Froberg was the Director of the Water Services Department, and that the 600 miles of pipeline now translates as $1 billion. The article was updated with the correct information.
