Aspen looks at increasing rates for water usage
October 15, 2014
City of Aspen water utility customers could see average bill increases of around 4 percent in 2015, and in the following years, Aspen's wealthiest and most excessive consumers could see significant hikes.
That's according to Lee Ledesma, Aspen's utilities operations manager, who is preparing budget recommendations that she will present to the Aspen City Council on Oct. 21.
As proposed, Aspen would see a tightened four-tier billing structure, meaning higher rates for less consumption. Rates are increased successively across four tiers. Ledesma is recommending a tightened billing structure because Aspen's energy costs are far outpacing revenue streams, she said.
"If you take electric as an example, since 2011, our average purchase power has gone up about 10 percent a year," she said. "Our average revenue increases during that same period of time is 4 percent."
At past meetings, she said council members have agreed that the current tier structure, which was implemented in 2006-07, is no longer effective.
If approved, the changes — which include alterations to non-consumption charges — would increase water-utility billing for the average residential customer by 4.2 percent, while commercial customers will see increases of 3.9 percent, she said.
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But in the long run, it's Aspen's wealthy second-home owners who could see the most significant impact, Ledesma said. While the average residential customer consumes 10,000 gallons of water per month, Ledesma's office sees some customers consume hundreds of thousands of gallons a month. In those cases, the department usually phones the customer, and more often than not, it's because property mangers have been instructed to irrigate multiple acres multiple times a day.
"We definitely have customers that use six times the (fourth tier)," Ledesma said.
There are two problems with excess consumption: The fourth tier runs to infinity, and Aspen has a low billing rate at its highest tier. While Aspen charges $5.26 per 1,000 gallons of water, Ledesma has found that other Colorado utilities charge between $16 and $18 for the same amount.
"If you've got 60 percent of your usage happening in the fourth tier, then it's slightly impactful," she said.
She added that in the summer months, most customers stay in the second tier while some hit the third, but there is a group that consistently stays in the fourth. In the future, she said the city may explore increasing fourth-tier rates.
"The most significant impact will be on the people who are not here that much, that have property managers that may be instructed on how often to water and how much to water, and there's just not a lot of attention to the overall impact," she said.
Ledesma plans to have further discussions with the council about electricity billing in December, while water billing talks are expected to resume in the spring.