29.0°

Water and sewer utility rates are poised to increase following a Juneau Assembly committee recommendation.

The proposed increases are relatively modest, going from $56.01 to $58.25 per month for residential sewer service and $23.06 to $23.41 per month for water. Collectively, that's an extra 3.3 percent. A second similar increase is also planned for the new budget year that begins in July.

As recently as 2003, the rates had shot up 39 percent for sewer and 19 percent for water. The Assembly's Public Works and Facilities Committee grilled utility officials over why the fees are constantly rising during a committee meeting on Monday.

Assembly member Randy Wanamaker said some constituents will raise a stink over any increase, no matter how modest.

What it boils down to, utility officials explained, is that as new water and sewer lines expand into low density areas, the new customers' monthly fees - earmarked for operations and maintenance - don't provide enough to cover the new costs. As Assembly member Jonathan Anderson put it, existing customers subsidize new customers.

Public Works director Joe Buck said the utilities already run efficiently and there's nothing left to cut but service.

"To reduce cost, we must reduce services. We've spent tens of millions of dollars expanding services," Buck said.

The flip side of expansion is that land served by water and sewer are more amenable to growth and denser development. For that reason, city engineering director Rorie Watt advised the committee to rezone newly serviced areas where possible to allow more development to generate more revenue and level out the cost burden.

The full Assembly must consider the rate increases before they are adopted.

The one-time capital costs of expanding water and sewer lines are not paid for with the monthly utility fees. Availability of grant money and tougher environmental regulations suggest the lines will continue to expand in Juneau.

For example, Gov. Sarah Palin's proposed budget calls for $1.7 million for future phases of the expansion of sewer lines in west Mendenhall Valley and $1.9 million for expansion in North Douglas. At its next regular meeting, the Assembly is expected to draw down state grant money for more imminent phases of these projects worth $1.2 million and $1.3 million, respectively.