Grand Terrace Council Approves Sewer Rate Increases

Four months after the Grand Terrace City Council approved a new 50-year agreement to contract sewage services from the city of Colton, the Grand Terrace City Council on July 8 approved an ordinance to raise sewer service fees for Grand Terrace residents. The fee increases will go into effect Sept. 1. As part of the new agreement between the two cities, Colton will now operate and maintain the existing Grand Terrace wastewater collection system—the infrastructure which carries wastewater from Grand Terrace to Colton’s treatment facility—including the collection, pretreatment, maintenance, treatment and billing and capital improvements for the system, a Colton staff report dated March 18 states. For access to, and the rights to maintain and operate the Grand Terrace wastewater system, Colton will, according to the agreement, pay an initial one-time lease payment of $400,000 and subsequent annual lease payments of approximately $300,000. In past wastewater agreements with the city of Colton, Grand Terrace was responsible for the operations and maintenance of its own wastewater infrastructure, while its wastewater was treated in Colton’s treatment facility. Grand Terrace council members attempted to assure residents objecting to the sewage service rate increases during last Tuesday’s regular meeting that the increases were proportionate to the funds deemed necessary to cover maintenance and administrative costs associated with wastewater treatment as proposed by NBS, an independent financial consultant company that conducted a rate study and cost of service analysis for the combined Grand Terrace and Colton wastewater systems. Councilmember Sylvia Robles said, “Rates are very conscientious. They’re very small. I think it brings stability to users out there and predictability on what you’re going to pay for a while.” Since before its incorporation in 1978, Grand Terrace has contracted sewage service treatment from Colton. The new agreement was signed with a corresponding settlement agreement requiring Grand Terrace to pay Colton $1.2 million from Grand Terrace’s sewer reserve fund to cover the cost of back fees that had not been paid by Grand Terrace for providing sewage treatment services in the past. In the rate study, Grand Terrace and Colton residents were separated into five different customer classes: residential (including single-family residences, mobile homes and churches); multi-family (including apartment units and condominiums); schools; commercial and industrial customers; and significant commercial and industrial consumers, which Grand Terrace does not currently have. Under the fee increase, residential customers who were paying $27 monthly for sewage services will see a rate increase of $5.35 and multi-family customers who were paying $24.18 each month will see a rate increase of $3.97 beginning in September. According to the agreement, Grand Terrace’s proposed sewage rates will rise annually, effective July 1 each year up through July 2017. Councilmember Darcy McNaboe said she felt the current agreements with Colton were logical because the cost Grand Terrace was paying on maintenance of wastewater infrastructure overshadowed the revenue coming in. “Beyond that agreement with Colton, we were looking at raising our rates strictly for our maintenance of our wastewater system that we have,” Councilmember Darcy McNaboe said. “…We knew that ultimately rates were going to rise, but they would have had to go up even if we didn’t have that agreement with Colton.” The approved Sewage Service Agreement stipulates that funds incurred by Grand Terrace residents for sewage service fees will be collected by the city of Colton and kept in a separate account specified for the maintenance, operation and improvements of the Grand Terrace wastewater system. Leasing funds paid to Grand Terrace will be placed in the general fund. “The city’s general fund is, essentially, for all intents and purposes, its operating budget,” said Ken Henderson, Grand Terrace interim city manager. “Unless use is restricted, the money virtually funds the city… it’s used to pay for city personnel and activities.” Nine protests to the rate increases were received by the Grand Terrace city clerk prior to the council’s approval of the fee raises, but that number did not reach the required 50 percent dissention rate to prevent the ordinance from passing. Diane Kimble of La Paix Street submitted a written protest referencing the failure of Measure C, which proposed a rise in user utility rates, to pass on the November 2013 special ballot. “The residents of Grand Terrace already voted down a proposal to impose fees on all residential utilities,” Kimble wrote. “This new increase seems to be another approach to impose increasing fees in a different fashion.” Some turned to social media for an understanding of the agreement and its effects, asking questions on the Facebook page “92313 Politico,” which offers a platform for residents and city leaders to discuss political-related issues online. “I would say to be fair that this could be seen as a way to indirectly tax the residents in a way that adds $300,000 to the general fund as a result of this new agreement, bottom line. It is curious as this happens only months after Measure C failed…,” Grand Terrace resident Russell Dunn commented on a thread posted June 19. Henderson said city councils of both cities voted twice since the original wastewater agreement was renewed in 1980 to increase the sewage rates, but those rates were never implemented for Grand Terrace residents. With the rate increases in effect, Grand Terrace residents will pay the same rates as Colton customers. “It has nothing to do with Measure C,” Henderson said. “The most important reason why the rates have increased is because both city councils voted twice to increase rates.” Mayor Walt Stanckiewitz said, “In my estimation, this is the fairest settlement and fairest arrangement we could come to.” In accordance with the agreement, Colton took over the maintenance of the Grand Terrace sewer system on July 1.