Utility weighs 5% increase in water rate

Proposed hike would raise average user’s bill $36 a year

Monthly water and sewer bills in Bernalillo County would increase by about 5 percent starting July 1 under a proposal the Albuquerque Bernalillo County Water Utility Authority board will consider next month.

The increase would raise the average homeowner’s monthly bill from $49.73 to $52.77 in winter, and from $54.20 to $57.23 in the summer, utility officials estimate.

The utility plans to seek three additional rate increases ranging from 3 percent to 4.5 percent in 2020, 2022 and 2024, said Mark Sanchez, the utility’s executive director.

The rate hikes are intended to allow the utility to use cash, rather than borrowing, to pay for infrastructure needs, such as an ongoing $250 million overhaul of the utility’s wastewater treatment plant, he said.

At this time the utility does not plan to ask for additional rate increases after 2024, Sanchez said Tuesday in a meeting with Journal staff.

The July 1 increase would increase the bill for the average residential water user by about $36 a year. Consumers would see the increase reflected in their Aug. 1 water and sewer bills.

The utility board last raised water and sewer rates in 2015, by 5 percent.

The seven-member water authority board will consider the rate increase May 17 as part of the utility’s proposed budget for fiscal year 2018, which begins July 1. Board members include three Bernalillo County commissioners, three Albuquerque city councilors and Mayor Richard Berry. Los Ranchos de Albuquerque Trustee Pablo Rael is a nonvoting member.

The proposed budget would increase the utility’s revenues from $215 million this year to $222 million in fiscal year 2018.

Capital spending would increase by about $6 million to $64.5 million next year, under the proposed budget. About 60 percent of that spending would be used to continue work on the utility’s Southside Wastewater Treatment Plant.

The utility’s long-range plan is to increase capital spending for scheduled maintenance of infrastructure and to reduce the cost of emergency repairs, officials said.

“The only reason for (the rate increases) is to continue that capital spending increase,” Sanchez said.

Stan Allred, the water authority’s chief financial officer, said the utility plans to increase infrastructure spending by $3 million each year through 2027, when the utility plans to spend $76 million a year.

“We don’t want to borrow to pay for increased capital spending,” Allred said. The rate increases are intended to pay for infrastructure “without putting an undue burden on the ratepayer” from having to add interest costs into the price, he said.