Chandler Council OKs utility rate hikes - SanTan Sun News SanTan Sun News

Chandler Council OKs utility rate hikes

May 8th, 2022 SanTan Sun News
Chandler Council OKs utility rate hikes

By Ken Sain
Staff Writer

Chandler’s City Council is moving ahead with raising utility rates starting July 1. That decision is not sitting well with the city’s business community – or one council member.

Chamber of Commerce Chairman Rick Heumann spoke during an April 28 public hearing to ask Council to postponed the effective date of the  rate increases until Jan. 1.

“People’s budgets are done – they’ve been done for many months,” said Heumann, who is a former member of Council and currently chairs the city Planning and Zoning Commission. “Possibly 45 days from now you’re going to have a major rate increase for our businesses and HOAs.”

Heumann said since businesses and homeowner associations make their annual budgets for the calendar year, delaying until Jan. 1 made sense to give them time to plan ahead – especially as most of them are already dealing with higher prices because of inflation.

Councilmember Rene Lopez said he was sympathetic, but that delaying the start of the rate increase six months means that residents would continue to pay more than their fair share of utility rates.

“I can truly appreciate businesses out there that are struggling with what’s going on with inflation but so are the households,” Lopez said. “And we’re asking if we do delay this … we’re further putting the burden onto our residents to subsidize the water that our businesses use.”

As part of the research for this rate hike, the city commissioned a cost of use analysis study. It tried to determine how much each type of customer used the different utility services and the rate they were paying for them.

It found residents have been paying more than their fair share for water for years while businesses have been paying less for what they use.

Chandler will not be raising rates the same on every type of customer. The water bill will increase 1.27% for residents, but 5.88% for landscaping. That’s to start getting them aligned with the cost-for-service study.

The increases for businesses are significantly higher, ranging from 3.79% to 4.33% for water and 6.88% for waste water. Businesses must hire private collectors for garbage.

Officials had planned for the rate hike to begin on Jan. 1, 2022, but that was delayed by the cost-of-service study and other pandemic-related reasons.

Chandler will have the lowest utility rates even with this hike of eight Valley cities after Gilbert raised its rates significantly this year.

The city did look at what delaying the rate hike to the start of 2023 would mean, and determined it would lose about $2.2 million in revenue. A delay would also mean a larger rate hike when the city again addresses the issue in 2024 to make up for that lost revenue, officials said.

The increase for homeowners prompted Councilman Matt Orlando to cast the lone vote against the rate changes.

“Residents should be held harmless in all this stuff, because they’ve been paying for the last 10 years,” Orlando said. “That’s why we did this rate study. I just feel it isn’t appropriate at this time (to raise their rates) when they’ve been paying all these years.”

There are some other changes coming starting July 1.

First, Council members said they heard loud and clear that Chandler residents like their alley trash pickup and want to keep it. It will cost them an additional $1.61 per month to do so. That’s what the city estimates is the extra cost to do alley pickup instead of from the front of houses.

Also, residents will get two free bulk collections from their home per year. After that, it will cost $30. Residents can also haul truckloads of up to 400 pounds to the Recycling Solid Waste Collection Center twice a year without paying. Any additional visits will cost $10.

The city says 95 percent or more of its residents will not have to pay extra for those services. The fees are intended to the repeat users.

The rate hikes are being phased in, so the city will make adjustments every two years. City utilities need to pay for themselves. The city said sometimes those adjustments include cutting rates.