Columbia is a full-service city, but all those services come with a cost.
User fees contribute 46 percent of the city’s overall revenues and, as city expenditures increase in the proposed city budget for the fiscal year that begins in October, so will city utility rates.
Water rates will increase by 4.5 percent, pushing up the average residential bill by 63 cents a month. Sewer rates will also increase by 4.5 percent, resulting in an average increase of 69 cents a month.
Water and wastewater are not the only services facing increased rates. Refuse collection rates are slated to go up 3.9 percent a month, or about 42 cents, for the average residential customer.
Increased operation costs are driving the increases, which would begin with the new fiscal year would begin with the new fiscal year if the budget, released on Thursday by City Manager Ray Beck, is approved.
“We have had rate increases in the past few years due to previous bond issues, but not for covering operational expenses,” said Jim Windsor, manager of rates and fiscal planning for Columbia Water and Light. “As the utility continues to grow and the coverage area continues to grow, then we have increased expenses.”
“We’re still substantially lower than anybody around,” he added.
New city customers will also have to pay higher connection fees for water and sewer utilities. The water connection fee will increase from $365 to $500, and the sewer connection fees will increase from $300 to $400.
The operational rate increases would begin before any rate increases that would accompany water and sewer bond issues up for voter approval in November. The rate increases for the bond issues would begin in October 2004.
Although electricity rates will remain unchanged in the fiscal year 2004 budget, Beck said in his presentation that they are also expected to go up eventually.
“We have had a very beneficial contract that helped keep costs down, and we haven’t had a rate increase in a long time on the electric side,” Windsor said. The electric contract will expire in May, and the city is in the process of negotiating a new contract to replace it that is more reflective of new electricity prices, he said.
Since the higher-priced electricity would only affect about four months of the new fiscal year that begins in October, an increase was not necessary this year. But it’s likely that an electric rate increase will be proposed for the fiscal year that begins in October 2004, Windsor said.
The increases contrast with a decreasing city growth rate. According to 2000 Census data, Columbia’s growth rate was 2.2 percent in the previous decade, but recent data indicates a decline to 1.4 percent from 2000 to 2002.
Quality of life could suffer with a negative growth rate, Beck said, but the current decline isn’t worrying him just yet. “As long as the city has some growth, that’s healthy,” he said.
Overall, the new spending plan calls for about $236 million in total expenditures, up 3.3 percent from last year’s budget of about $227 million.
About $1.6 million of that money will go to parks and recreation projects, including the Stephens Lake Park project.
The budget plan includes about $600,000 to continue implementing the Stephens Lake Park Master Plan. The money will fund construction of a 10-foot-wide concrete trail around the perimeter of the park as well as some 6-foot-wide interior sidewalks that will connect a lot of the features of the park, said Steve Saitta, park development superintendent.
Additionally, there are funds for the Broadway entrance at the park, landscaping and site amenities such as water fountains and lighting, Saitta said. “There is also money for the amphitheater that will provide a setting for outdoor entertainment.”
Although Beck presented the budget Thursday, it will not be approved until September, after the City Council holds work sessions and public hearings.