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Clogged Storm Drains at Intersection of Laurel and Albemarle
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Category Archives: water
Richmond Water Rate Reformers Respond to Utility Report
So, this press release went out on Monday:
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Richmond Water Rate Reformers Respond to Utility Report
Richmond water rate reformers had been eagerly anticipating the Sept. 17th City of Richmond Department of Public Utilities Report to Council (pursuant to City ordinances 2013-58-77 and 2013-61-79, study performed by DPU with consultant Ratfelis Financial Consultants). A copy of the study was finally earlier this month and is attached to this press release. Disturbingly, the report has not been worth the wait. It lacks substance and appears to be written to support the existing rate structure. At this point, City Council has asked it’s staff to review and make some comments and recommendations for next steps, which suggests that it will consider the issue further in the next budget cycle.
Citizens are urged to contact the press and their City Council representative and ask why the base charges cannot be further reduced and why the PILOT for federal tax is still part of their bills.Report lacks substance:
Pages Topics
00-01 Table of contents
02-03 Executive summary
04-05 Purpose
06-09 Concepts
10-12 Reconciliation
13-13 Expenses
14-15 PILOT cost
16-20 Affordability measures
21-26 Low Income assistanceThe only things new are some subsidy ideas, which are arguably not the purpose of DPU. There is no consideration for the relatively high base charges of $26.11 (which Mayor Jones only partially addressed last year) or the unlawfulness or appropriateness of the federal PILOT (payment in lieu of federal taxes, which, again, no private business pays to the City). In the report chart (page 3) showing how rates would change if this PILOT payment in lieu of federal income tax was eliminated, instead of showing a reduction in the base service charge, the report shows only a reduction in the volumetric charge. It does not justify the allocation of the charges to the base service charge vs. the volumetric charge.
Here is why this is important: since we know the number of residential and commercial customers, we can compute that the base water/sewer service charge for each customer can be reduced $7.62/month just by removing the (probably illegal) payment in lieu of Federal income tax.
Here are the figures: According the water rate study, in 2014 PILOT payment in lieu of FEDERAL INCOME TAXES for the water and wastewater will be $5,442,575.
There are 51,825 residential and 7683 commercial water customers, or 59,508 total water customers. $5,442,575 divided by 59,508 customers equals $91.45 per customer. $91.45 divided by 12 months equals $7.62 each month that each customer’s base water/sewer bill could be reduced just by removing the PILOT payment in lieu of FEDERAL income tax.We note the American Water Works Assoc. Policy on Financing, Accounting and Rules, which state among other rules, ” Reasonable taxes, payments in lieu of taxes, and/or payments for services rendered to the water utility by local government or other divisions of the owning entity may be included in water utility’s revenue requirements after taking into account the contribution for fire protection and other services furnished by the utility to the local government or to other divisions of the owning entity.” Federal taxes do not meet the reasonable critera.
Does the City subtract the services provided by the utility from the charges to the utility? What about fire hydrants service, street light services. Also, do public buildings pay for water and sewer?In the report’s discussion of affordability it does not address the fundamental idea of lowering the base rate further to provide an incentive for conservation, as well as a means to lower the residential bill. Where is the Anti-Poverty Commission on this matter? In the big picture, conserving water reduces the need for more infrastructure, chemicals, etc.
This report also ignores the effect of the potential savings to water and waste water operations from the creation of the storm water utility and the offloading of part of the common service functions costs to the storm water utility budget. Upon examining the DPU’s organizational charts for all three utilities, it is not clear what if any accounting procedure is used to allocate time and charges for each utility. Most of the storm water employees were DPU employees prior to the creation of the storm water utility in 2009.
Water rate reformers are reserving their comments for now on the reformatted water bills being sent to customers. We hope to collect more feedback. But we also note that there have been recent complaints about erroneous billing due to faulty water meters, that have been reported on by WTVR television news.
Background information:
http://www.change.org/petitions/reform-richmond-s-water-rates/
City Water Rate Reform Work Continues
Yesterday’s email message:
Hey everybody,
I hope you all had a great summer.
We will be ramping up the Richmond, VA water rate reform campaign again this October.
For one thing today (Sept. 30) is the day that the City utility should be presenting some options to City Council. Also, the new format for utility bills should be rolling out. You may have seen that DPU is also working on their efforts with a “Citizens’ Academy”.
Here is the “311” on that:
“The city of Richmond Department of Public Utilities introduces a four- session course to give participants a working knowledge of their public utilities provider. Each course consists of a classroom portion and ends with a tour of the utility functions discussed. Participants are encouraged to register for all four courses. Class size is limited to 20 students. Each class is scheduled on a Tuesday afternoon from 4–6 p.m. in October at various locations throughout the utility.
“Our goal is to create a better understanding of how the utility manages the important resources entrusted to us and provide our customers with an educational, interesting and engaging experience,” said Utilities Director Bob Steidel.
· SESSION 1: Oct. 1, 2013 – DPU Operations Center Atrium
400 Jefferson Davis Highway, Richmond, VA 23224
· SESSION 2: Oct. 8, 2013 – Wastewater Treatment Plant
1400 Brander Street, Richmond, VA 23224
· SESSION 3: Oct. 15, 2013 – Water Treatment Plant
3920 Douglasdale Road, Richmond, VA 23221
· SESSION 4: Oct. 22, 2013 – DPU Operations Center Atrium
400 Jefferson Davis Highway, Richmond, VA 23224
All sessions take place from 4-6 p.m.For questions or to register, call or email DPU Public Relations and Marketing specialist Rhonda Johnson at (804) 646-5463 or rhonda.johnson@richmondgov.com.”
If you recall, the water rate reform campaign refocused on what’s called the PILOT (payment in lieu of taxes) portion of the bill after Mayor Jones did address PART of the minimum payment. Over the summer, I saw an opinion by the CIty Attorney that seemed to suggest the PILOT for federal taxes was legal, going along with what the utility has said. However, I have not heard back yet about an opinion from the State Attorney’s office. State Sen. Watkins was good enough to ask for that on our behalf back in May. So, for now, we are still zero’ing on the federal taxes portion of the PILOT in the City’s water bills.
Why are Richmond customers still forced to make a monthly payment lieu of Federal income taxes on their city water bill?
The message right now:
The Sierra Club Falls of the James group helped bring to the city’s attention last year the injustice of charging every household about $60 annually for a payment in lieu of Federal income taxes. This payment, of questionable legality, is a regressive means of taxing a basic necessity to finance the city’s general fund. The city can legally charge the customer for taxes that would be paid to the city if the water works was privately owned, but no private company pays Federal income tax to the city.
The city’s base service charge is still not shown on the bill, so most customers are not aware that they must pay $26.40 each month just to be connected to the water supply. Other localities charge a far lower service charge. The monthly service charge in Norfolk is only $1.
Richmond’s STILL high service charge does not promote conservation, and it is unfair to low and moderate income residents. It is as though the city has pegged the service charge to the poverty rate. With 26% of Richmond’s residents living below the poverty level, it is unconscionable to charge $26 to be connected to the water supply.
Stay tuned, and again, thank you so much for your support.
Scott Burger
P.S. I invite you all again to join the Sierra Club Falls of the James (http://virginia.sierraclub.org/foj/) as well as Better Government- Richmond (http://bg-us.org). These groups are working hard to improve our lives.
This message was sent by Scott Burger using the Change.org system. You received this email because you signed a petition started by Scott Burger on Change.org: “Reform Richmond’s Water Rates!.” Change.org does not endorse contents of this message.
Holmberg On The Rope Swing
WTVR reporter Mark Holmberg did a nice little piece on the Tredegar Street rope swing. Here’s how it begins:
It’s just a missing rope swing. One that goes missing from time to time.
And yet, it’s an identifiable part of the cityscape, a Richmond tradition, if you will, every bit as evocative as the smell of Shockoe Bottom or the vista atop Sunset Hill where Grace Street surrenders for a clifflike block.
At least two generations and mayhaps more have loved this rope swing hanging high from the railroad trestle between Brown and Belle islands on historic Tredegar Street. It’s about 40 feet above the mighty James River, which offers a mostly friendly little eddy – with a deluxe sandy bottom – to embrace the tens of thousands of laughing, splashing swingers.
He goes on to say that although no one admits to cutting down the swing, it does happen from time to time and then returns.
JRA Volunteer Opportunities
From email:
There are several volunteer opportunities across the watershed to come out and help the James River. If you are interested in any of the events below, just let me know.
August 17: The Tire-Less James
Volunteers are needed to remove tires — and only tires — from the James River between Lynchburg and Richmond during the first Tire-less James Event. We recommend that you wear work gloves and closed toe shoes. Canoe or john boats are best. We are encouraging as many groups as possible to choose James River State Park (Dixon Landing) to Wingina (5.5 miles), there will be multiple historic James River batteaux on site to help carry out tires from this section. Groups can look at available sections and register online. http://www.jrava.org/get-involved/volunteer/tire-less-jamesSeptember 14, 9am-1pm: JRAC Cleanup
Join hundreds of volunteers across the James River watershed to clean up trash. Select from 15 different sites from Lynchburg to Newport News. Look at available sites and register online. Help with recycling is needed at the Reedy Creek site that JRA sponsors. http://www.jrac-va.org/events/cleanup/September 21, 9:30 am – Noon: Rain Garden Maintenance and Cleanup
Help with weeding, planting, and mulching of several rain gardens. All tools will be provided. Please wear sturdy shoes and clothes that can get dirty. Meet in the parking lot behind Advance Auto, 6300 W Broad Street, Richmond. Pre-registration is required. To register, please contact Amber Ellis at 804-788-8811 ext 205 or volunteer(at)jrava.org.September 22, Richmond Splash & Dash
The James River Splash & Dash is a competitive tube race which takes place near Richmond’s Belle Isle. After the race, JRA hosts an after party that includes a live music and food. Volunteers are needed for various tasks that day including registration, race marshals, and set up. http://www.jrava.org/splash-and-dash/richmond/indexAmber Ellis
Watershed Restoration Associate
James River Association
9 South 12th Street, 4th Floor
Richmond, VA 23219
Tel: (804) 788.8811 ext.205
Email: aellis(at)jrava.org
www.jrava.org
Tire-less James River Volunteer Opportunity
Volunteers are needed to remove tires from the James River between Lynchburg and Richmond during the first Tire-less James Event. Sign up today at http://www.jamesriverassociation.org/get-involved/volunteer/tire-less-james
JRA is partnering with Virginia Canals & Navigations Society and the Heart of Virginia Council, Boy Scouts of America in The Tire-less James project on August 17.
Swollen River
Water Rate Debate ‘Takes Backseat’
Excerpt from Times Dispatch article, “$24M ISSUE:
Utilities’ payments to Richmond take backseat in water/wastewater rate debate
Richmond has utilities make special payments into general fund”:
Historically, the council has been reluctant to tackle the payments to the city that are a built-in component of water, wastewater and gas bills.
According to Richmond’s City Charter, the city’s public utilities, with the exception of the stormwater utility, are required to pay into the city general fund “taxes not actually accruing but which would have accrued had the utility not been municipally owned.”
All told, the so-called payment in lieu of taxes, or PILOT, for the water, wastewater and gas utilities will account for nearly $24 million of the $760.5 million general fund in the proposed budget for the fiscal year that starts in July. That’s an increase of 7.4 percent from the prior year. And for the fiscal year that starts in July 2014, it’s expected to grow to $25.6 million.
For decades, the PILOT provision has been interpreted to mean that the city is entitled to collect payment for virtually any tax the utility would be required to pay if it was privately owned. That includes real estate, personal property, gross receipt and even income taxes, which the city does not collect from private businesses.
The water and wastewater utilities, for example, will pay nearly $3.3 million in income taxes into the city’s general fund this year.
According to a city marketing campaign to promote the new rate structure, which has cost utility customers more than $23,400 in newspaper and television advertising since March, the PILOT accounts for 14 percent of the base charge for water and wastewater.
Scott Burger, a longtime member of the Falls of the James Sierra Club and a former president of the Oregon Hill Neighborhood Association who has pushed for lower water bills for years, most recently as a member of the Better Government for Richmond watchdog group, said dropping the charges without addressing the PILOT doesn’t deal with a core problem.
“In a sense it’s a step forward. It’s still basically gouging people on water,” Burger said. “I don’t think it’s totally clear to people what’s going on.”
Through the Freedom of Information Act, Burger polled seven other sizable Virginia cities on their municipal utilities.
“What came back is that no other peer city has utilities that pay into their general fund in lieu of federal income tax,” Burger said, adding that he has contacted state legislators about addressing the issue. “Why does Richmond?”
City Councilman Parker C. Agelasto, whose 5th District includes Oregon Hill, has asked the city attorney to give an opinion on whether the city can collect payments in lieu of income tax and wants to take steps to reduce or eliminate the PILOT.
“I think it would be hard to disagree that if everybody in the city’s water bill went down $5 a month, then that would be a good thing for everybody in the city,” Agelasto said.
Agelasto, elected in November to his first term on the council, has also introduced an amendment to the proposed budget that would require more analysis of the cost of service study, which the Department of Public Utilities commissioned for nearly $201,000 and used to compile the new rate structure, in an effort to lower water rates further.
Agelasto said his amendment wouldn’t affect the new rates included in the proposed budget, noting that utilities department staff members had months and the benefit of a study to help them make their case for the new structure.
More background to click through here, here, here, here, and here.
Breaking Down The Water Bill
From press release:
Better Government Richmond, a citizen advocacy organization, is pleased to announce the release of a new video about the City of Richmond Water Utility Charges and Rates. Better Government members produced this video in order to inform the public about the Mayor’s proposed plan that is under review by City Council. Better Government mentioned a study of the water utility by paid consultants as one of its top issues in its first press release in February.
The 9-minute video includes information regarding the consultants’ study as well as an explanation of charges on a sample City of Richmond utility bill. It has been made available online at Vimeo.com as well as on Better Government Richmond’s website and Facebook page. Supporters are asked to share with their neighbors and contacts.
The Vimeo.com url is http://vimeo.com/64618134
See also:
Facts About the Mayor’s Proposed Water Rate Change
Please consider and share the following as City Council goes over the budget.
FACT SHEET: Richmond’s proposed $26.11 monthly water/sewer service charge
At $26.11, Richmond’s minimum monthly water/sewer service charge would still be one of the highest in the nation. It is a burden for every senior citizen getting by on Social Security and every other low income resident of the city to pay $313 annually just to be connected to the water supply.
1450 persons have signed a petition asking that Richmond reduce the minimum monthly service charge to $15 per month, which is line with other localities.
The city is using the utilities as a “cash cow” for the city’s general fund. Of the $12 million annually paid by the water and sewer utilities into the city’s general fund, $3 million is paid in lieu of FEDERAL INCOME TAXES, which no business pays to the city. Every customer’s monthly service charge could be reduced $4 each month if the payment in lieu of FEDERAL INCOME TAXES was removed.
Henrico’s service charge is about half of Richmond’s and Henrico gives a discount to those who use 3 or less units of water volume.
Water is a necessity that no one can do without. This is the most regressive means possible to fund the city through an outrageous service charge on this necessity. The city residents own the utility, which should provide an affordable base price for water service to those willing to conserve water.
The city’s water rate structure provides little financial incentive to conserve water because the large service charge is the same even if the customer uses little water.
In Norfolk, the minimum monthly service charge is $1; everyone’s bill is in proportion to the amount of water used.
The minimum water/sewer service charges are not even shown on the bill, so most residents are not aware that they are paying a high monthly service charge — even if they use no water.
If Richmond had fair water rates that provided a financial incentive to conserve water, there would be less need for more chemicals and water treatment facilities. Fewer pollutants would be released downstream. The city would be better prepared for periodic drought conditions.
By the way you can see from our list that the city’s proposed $26.11 base water/sewer service charge is still higher than most cities:
Henrico: $16.27
Chesterfield: $22.16
Norfolk: $1.00
Charlottesville: $8.00
Petersburg: $13.90
Hopewell: $25.39
Alexandria: $18.20
Roanoke: $20.75
Washington DC: $3.86
Charlotte: $4.92
Greensboro: $3.04
Raleigh: $5.81
Columbia,SC: $11.01
Macon,GA $15.75
Tallahassee,FL $24.86
Pittsburg: $16.59 (includes first 1000 gallons)
Knoxville: $24.75 (includes first 1,500 gallons)
Memphis: $10.82
Louisville Ky: $21.27
Little Rock AR: $20.72
Oklahoma City: $13.03
Kansas City Mo: $22.30
Milwaukee: $9.65
Lincoln Ne: $4.92
Bismarck ND: $12.20
Helena,MT: $6.97
New York City: $12.90 (includes 4 ccf)
New Orleans: $15.65
Phoenix: $5.36
Albuquerque: $15.32
Dallas: $8.30
San Francisco: $7.90
Atlanta: $13.12
Seattle: $23.93