Council tweaks proposal to raise water rates

April 19, 2010 3:38:39 PM PDT
With a vote coming as soon as Wednesday, the City of Houston proposed some major changes in the way it would dole out water rate increases. One city council member found says she found the changes to be a bit confusing, given the timeframe these decisions need to be made.

"To tweak the amount or percentage for cost-of-service for some groups going forward -- at the beginning -- we have to get there, and we need to decide it now," Houston City Councilwoman Melissa Noriega said.

The city first discussed increases back in April. Originally, multi-family units and commercial properties seeing the biggest percent change

On Monday, the city scaled back those increases under the revised plan.

Single family residents would continue to see an increase about $5.87 a month.

Multi-family consumers would go from a $9.10 increase proposed in April to $7.73.

Commercial uses, who were originally proposed to see an average 20.1 percent increase, now face an 8.1 percent increase.

The city says it needs to raise the water rates to pay for repairs and upgrades. It also believes residents have been paying far less than residents of other cities, so it wants to make sure residents are paying for 100 percent of what they're using.

"What is the cost of service? And it was our goal (to), as much as possible, (get) each class of customer to that 100 percent," said Houston Chief Development Officer Andy Icken.

But, of all the changes proposed on Monday, the one with the most question marks regards HUD properties.

Legally, owners cannot pass any utility increases onto tenants because it's a federal program, so the city proposed setting up a $14 million rebate program for those owners.

Steve Ford, who owns several subsidized properties, believes the rebate program is a step in the right direction but worries, it won't be enough.

"If they raise the utilities enough, basically the properties will not underwrite; therefore, the housing will go to Dallas, where they underwrite," Ford said.

Council members questioned how exactly the rebate program will work. There are about 19,000 of these HUD apartment complexes in the city. That's about 4,000 of about 400,000 residents they collected money on.

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