Lot-size changes could mean refunds or higher bills for utility customers

VALPARAISO — Corrected utility bills are on the way to 552 residents and businesses, but whether those bill-payers could get refunds for overpayments or bills for past underpayments remains unresolved.

The situation was created by the how properties have been classified for stormwater payments.

City ordinance requires a refund for all overpayments made over the previous year based on errors.

However, Utility Board members said it’s not clear whether that requirement should apply here. Previous classifications were made using the best available technology, which is why utilities director Steve Poulos said he preferred not to call the wrong classifications “errors.”

Board members Mark Thiros, Mike Sur and Lori Ferngren argued at Tuesday’s meeting that the county really hadn’t made an error, since officials had used the best technology available at the time.

However, board member David Bengs said not issuing refunds could cost the city more in lawyer’s fees in small claims court than the $16,764 total they’d have to refund, and Board Attorney Mike Langer said rate misclassifications could count as errors.

Bengs, Thiros and Ferngren are attorneys.

The original lot size calculations were made in 1998. Businesses pay monthly fees of $11 to $352, depending on the amount of hard surface they have.

Single family homes pay $11 a month, while multifamily buildings pay $8.25 a month per unit.

Since then, city officials using a new, more accurate method — overhead photography and computerized mapping technology the city acquired in 2011 — recently discovered that many parcels were estimated at the wrong size.

The Utilities Board did vote Tuesday to adjust rates, a move that will give the utilities department $130,449 a year more in stormwater fees.

That change includes some houses and multifamily buildings that were misclassified or had changed between singlefamily and apartments.

Board members split on whether the utilities department should require those who’ve underpaid to make up the difference.

Recouping a year’s worth of underpayments would mean $147,213, and the board has the ability to go after two years of incorrect payments.

Langer is to return to the board Feb. 11 after researching who wrote the ordinance and what their intention was.

Poulos had recommended that the board refund the overpayments but not punish those who underpaid because of the technology.