The proposed rate hike, the first since 1998, would add a third tier to the current pay-as-you-use system.The Peabody, Mass., City Council is set to take up the water and sewer rate increase proposed by Mayor Michael Bonfanti. The proposed rate hike, the first since 1998, would add a third tier to the current pay-as-you-use system.
Simply put, if you use more water, you will pay a higher rate. The new rates were approved by the council's finance subcommittee at a Sept. 3 meeting. ''We recommended it because we recognized that Peabody still has the lowest rates on the North Shore,'' said councilor Judy Selesnick, the committee chairwoman. ''It doesn't seem unreasonable that if people use more, they pay more.''
Peabody belongs to the five community South Essex Sewerage District. Combined water and sewer rates, per hundred cubic feet, for households in those communities are as follows: Danvers: $7.08; Marblehead, $6.30; Beverly, $5.75; Salem, $4.97; and Peabody, $4.91. The commercial rates are as follows: Danvers, $7.08; Marblehead, $6.30; Beverly, $5.75; Salem, $7.28; Peabody, $5.73.
The council will be asked to approve new rates for both residential and commercial customers. All rates will be retroactive to Sept. 1. The new water rate structure for homeowners is as follows:
Tier 1: The rate will increase from $1.81 per hundred cubic feet to $2.07, retroactive to Sept. 1. On March 1, 2003, the rate will jump to $2.12.
Tier 2: For more than 1,500 cubic feet of water used, the rate will jump from $1.98 per hundred cubic feet to $2.26. In March, the rate will be $2.31.
Tier 3: The new tier. Households that use more than 3,000 cubic feet of water will be charged $2.46 per hundred cubic feet. In March, the rate will rise to $2.52.
Proposed new sewer rates for homeowners are:
Tier 1: The current rate of $2.41 per hundred cubic feet will jump to $2.61. In March, the rate will be $2.83.
Tier 2: The rate will jump from $2.65 per hundred cubic feet to $2.87. As of March, the rate will be $3.11. There is no third tier for sewer use.
Commercial rates are also set to increase on a scale similar to homeowners. The proposed new water rates for businesses, retroactive to Sept. 1, are:
Tier 1: The current rate of $2.07 per hundred cubic feet will increase to $2.46 this month, and $2.52 in March.
Tier 2: For businesses that use more than 1,500 cubic feet, the current rate of $2.27 per hundred cubic feet will jump to $2.67 this month and $2.73 in March.
Tier 3: The new tier. Commercial customers who use more than 3,000 cubic feet of water will be charged $2.91 per hundred cubic feet this month. In March, the rate will rise to $2.98 per hundred cubic feet.
Sewer rates will also increase for business customers, which are the heaviest users. Those new proposed rates are:
Tier 1: The current rate of $2.78 per hundred cubic feet will rise to $3 this month and $3.25 in March.
Tier 2: The current rate of $3.07 per hundred cubic feet will jump to $3.31 this month and $3.59 in March. There is no third tier for sewer use.
Dave Hall, executive director of the Peabody Chamber of Commerce, said the new rate structure is fair because the increase for homeowners is on a par with businesses. ''Nobody likes costs to go up, but percentage-wise, the increase is fair. I think it's a good sign that our water and sewer rates for businesses and homeowners are still the lowest in the area,'' he said.
Bonfanti said the new rates were derived to close a $1.9 million budget gap in the city's water and sewer budget. Rising costs associated with the cost of drawing water from the Ipswich River, the city's primary water supply, or purchasing additional water from the Massachusetts Water Resources Authority, are mostly to blame for the shortfall, along with rising employee costs in the water department, he said.
''We have to be able to cover our costs,'' Bonfanti said. ''When we set these, we tried not to unduly burden the elderly or businesses. But everything has to be balanced and one way to achieve that is to have people who use large amounts of water, pay more.''
Bonfanti also hopes the new rate structure encourages water conservation. ''We need to get ahead of the curve on water. We take water in this area for granted, but like anything else it's a finite resource. People run sprinklers in the rain. To me, that's a waste.''