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City hears proposed water rate increase
Council takes first look at proposal to realign part of
Country Club Road
By KIRBY NEUMANN-REA
News editor
Proposals for a slightly wider utility revenue stream and a
largely different Country Club Road came before Hood River City
Council Monday night.
Council will not take further action on either move until
January 2011. On Monday, the council heard a proposal to enter
into a preliminary agreement with the Oregon Department of
Transportation to meet the city’s 2009 request that it be allowed
to use $3 million in state transportation funds to pay for
realignment of Country Club at exit 62. The city asked ODOT to
transfer the money from its original designation, improvements on
the Button Junction near exit 64.
The council also got its first look at the recommendation by
utility financing consultant Dan Bartlett that the city increase
one of three portions of the monthly utility bill: a five percent
increase in the water bill.
“This gets you to the point where you can raise the revenue
needed for debt service,” Bartlett said. (Debt service is the
amount of cash the city needs for the long-term repayment of
interest and principal on a debt, in this case repayment of bonds
and government loans for the $18 million water line replacement
project, now in its first phase.
The water bill increase is set to come before the council for
approval in January, as a way to pay off future debt for the water
line project.
Any water rate increase would not effect until October 2011.
Bartlett projected that without the water rate increase, the
city would be short $70,000 annually in meeting the debt service
payments on the water line replacement project. In April 2009 the
council approved a 15 percent water rate increase to help pay off
municipal bonds over a 40-year period.
Utility bills are divided into water, sewer and stormwater
sections. Under the proposal, the city would increase the water
portion of the bill by five percent. When spread out over the
entire bill, that would equate to a 1.8 percent hike in each part
of the bill.
“It’s the smallest (utility) increase we’ve had in years,” said
Mayor Arthur Babitz.
Under the Country Club realignment plan, estimated six months
ago to cost $5.7 million, the city would need to complete the work
by the end of 2013 in order to receive full payment from the
state. Costs would be shared by the state, city and newly
developed property.
Next month, the council will consider a proposed Memorandum of
Understanding with the state, which is the stepping stone it needs
to attain the legally binding Intergovernmental Agreement to
divert the needed $3 million fund to the Country Club Road
project.
A preliminary design for the project involves a newly
constructed Mt. Adams Avenue, east of exit 62, and the relocation
of Country Club road at exit 62. Access would be closed from
Cascade to Country Club.
Francis called the exit 62 area “one area we have the majority
of vacant parcels to really grow.
“The purchase of some or the larger pieces of property are
hinging on if the $3 million will be borne by ODOT,” he said.
“People are champing at the bit to buy and sell property out
there but this is only the first step,” Francis said.
The movement to assist development in the area is influenced by
the city’s review of how well it is meeting the state economic
development Goal 9, which states in part that the city
comprehensive plan should “provide for at least an adequate supply
of sites of suitable sizes, types, locations, and service levels
for a variety of industrial and commercial uses consistent with
plan policies…”
Any proportionate payments would affect only new developments,
not existing businesses, noted Francis.
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