Council could have raised sewer fees earlier

If the Town of Sahuarita had raised its monthly sewer rates years ago, it could have prevented the current operating deficit and relieved Rancho Sahuarita of any obligation to cover deficits, a representative of the developer told the Town Council on Monday.

The council was told by staff that without a rate increase, the town would face a cumulative deficit of $4.9 million over the next six years.

Council members voted 7-0 to place on the agenda for its Nov. 13 meeting an ordinance that would raise sewer rates in two steps by a total of 74 percent by July 1, 2008.

If approved, that measure would raise rates from the current average of $14.38 a month to $25 a month.

Council members did not raise questions, but three members of the audience commented.

Rancho Sahuarita resident Claude Campbell opposed the rate increase, saying the town had blundered badly in its provision of sewer services and questioned why the plant’s operating budget, now nearly $1.4 million, had run operating deficits year after year.

Campbell drew laughter when he asked whether the plant’s seven employees would get a 74 percent raise or whether the plan would get 81 coats of paint. Town Finance Director A.C. Marriotti said the plant employs seven people full time and listed a number of operating expenses, including electricity, chemicals, filters and other replacement parts, testing and consultants fees that contribute to the $1.4 million annual operating budget.

Marriotti said the plant has been in an operating deficit every year since 2002, when the town took over operation of the plant from Rancho Sahuarita, which built the plant.

La Canada del Norte resident Jeff Summers said his sewer bill, payable to Pima County, is $31.49 a month, so he saw nothing excessive about the proposed rates and supported raising the rates for the town plant to $25 a month.

The town plant serves Rancho Sahuarita and Rancho Resort, and much of the rest of town is served by the county plant in Green Valley.

Richard M. Rollman, attorney for Rancho Sahuarita developer Bob Sharpe, said the town improperly fired the plant’s independent manager several years ago, contrary to the agreement between the town and developer, and then kept rates artificially low.

“If those rates had been fairly set by an independent manager, the system would have been self-sufficient in 2003-2004 and then the deficit obligation would have gone away,” Rollman said.

In a July 10 letter to the town, Sharpe seemed to show support for raising fees, as he wrote “the Town has failed to set user fees at a rate sufficient to cover operational expenses. User fees should be set in an amount sufficient to meet the operating expenses and financial obligations of the wastewater utility.”

Marriotti said monthly rates have been raised nearly yearly but did not say why the plant remained in constant deficit. He said a survey of more than 100 wastewater utilities in Arizona conducted by a state agency showed the average rates to be just over $25 a month.

Under an agreement between the town and Rancho Sahuarita, the developer was obligated to subsidize the plant’s operating losses until it was self-sufficient, though the developer has said that was only intended as a temporary measure.

Rollman blasted the town for stating in a September report on the rate hike proposal that Rancho Sahuarita owes the town more than $1.4 million to cover operating deficits at the plant.

Rollman said the developer has never gotten a bill for more than $35,000 from the town for operating losses, and when the developer raised questions about that bill, submitted in April 2005, the town never responded.

Rollman also said the town’s failure to increase the plant size several years ago has caused problems and higher costs for residents of Rancho Sahuarita and Rancho Resort, the areas served by the plant.

Marriotti said the town so far has covered the plant’s operating losses with connection fees but could no longer do so because “we have an aggressive capital expansion plan under way that will likely use up all unspent hookup fees.

“This is important because currently the plant’s operational fund has been borrowing from the expansion fund. In a few years that will not be possible and that is why it is critical to get the monthly fees up,” Marriotti said.

The council also voted 7-0 to direct Town Building Official Andy Kelley to enforce the town fire code for five assisted living homes that have not installed fire sprinklers nearly two years after the town adopted that requirement as part of the International Building Code.

Kelley reported that two of the homes have contacted contractors recently. The deadline for compliance is Dec. 14.

pfranchine@sahuaritasun.com | 547-9738