Panel blasts using Portland water revenue for bikes and streetcars
Here's an interesting document, generated last week by the water standing committee (not the standing water committee) of the Portland Utility Review Board. It complains (as we have recently in connection with sewers) that the city's water bureau is spending customers' quarterly bill payments for stuff that has little or nothing to do with delivering water to those customers. The committee also questions whether the water bureau is using industry best practices to keep costs in line. And it criticizes the way water rates are set, in that there are no checks and balances to insure that water revenues are spent only on essential water-related projects.
Among the highlights of the report:
• The Portland Water Bureau (PWB) is proposing a 12.9% rate increase for FY '11 and a 13.5% rate increase for each subsequent year in the Five Year Financial PlanOf course, no recommendation for change would be complete without plenty of pork for consultants, and this committee wants the city to spend $600,000 hiring outsiders to come in and cover the same ground as in the free report the committee just wrote. But the fact that the utility board is objecting to diverting the obscene water (and sewer) rate increases for bicycles, streetcars, and community college scholarships is pretty telling.
• The annual bill for a typical PWB residential customer is expected to more than double by FY 2015...
• Ratepayers have a right to expect that current revenues are being used to fund operations that are competitive with industry best work practices...
Diversion of rate revenue for projects that are unrelated to the delivery of utility services has been a long term concern of the PURB. See the attached 2006 recommendation from the PURB on this topic.
Some recent examples of PWB spending rate revenue for projects that are unrelated to the delivery of utility services:
• $500K+ each year for maintenance of park fountains & downtown bubblers.
• Over $15M in bond funded work for PDOT projects involving MAX and the Streetcar over the last decade.
• Excessive (7.5%) license fee. Now gradually being lowered to 5%. But why is any license fee fair when the revenue is being used for unrelated city spending?
Some recent examples of media reports on proposals from city commissioners to spend rate revenue for projects that are unrelated to the delivery of utility services:
• Using utility rate revenue to fund the Bicycle Master Plan.
• Using utility rate revenue to fund college scholarships for impoverished youth.
The current system for setting water & sewer budgets and rates has the systemic problem that it lacks effective checks and balances. This situation is made even worse by Portland’s commission form of government where each commissioner directly oversees a portfolio of city bureaus....
In our opinion this is a severe shortcoming when considering the utility bureaus because the commissioners have unlimited authority to raise rates to match spending for those bureaus. After noting that the PURB has unsuccessfully tried to deal with this issue in the past, we are now convinced that the current system cannot ensure that water services are provided to consumers at just and reasonable rates....
For these reasons we are recommending taking steps to move toward a new process, with substantial checks and balances, for establishing budgets and setting rates for PWB and BES.
The brisk sweeping of these recommendations under the large City Hall rug will also make for fascinating viewing, no doubt.
As we've said here before, we need something like a Measure 5 for water and sewer bills. With property taxes strictly capped by law, and pension and other debt about to clamp down on their play money, the Sam-Rand Twins and their City Council colleagues are going to start sucking the life out of water and sewer customers, just as they're doing with parking meters and every other shakedown vehicle they can find.