Utility rate hike proposals as high as 50 percent continue for Marco Island customers

— Some Marco Island utility customers are going to be down in the dumps if City Council approves a proposal considered on Monday that will increase their water and wastewater rates again. Other islanders, will be pleased that fairness was considered in the reworking of the city’s utility rate structure.

All Marco Island water and wastewater customers endured a 9.5 percent rate increase last October; will see another 10.5 percent increase this October and if City Council approves the newest proposal, some will see hikes of more than 50 percent in their base rate. The base rate is the consistent monthly charge irrelevant of usage.

The proposed changes in base rates for various customer types may be somewhat beneficial to single family homeowners, while many condominium dwellers will see significant hikes.

“This is a terribly, terribly important issue that tends to put the condo world against the single family world, which nobody wants,” said Dick Bergmann of the city’s utility advisory committee.

A utility rate study by the five-member utility advisory committee sought to make base rates more equitable between customer types. Customer categories include multifamily with individual meters, master-metered condos, commercial and single family residential, among others.

In doing so, customers who may have enjoyed the lowest rates for years, the master-metered condominiums, will see compounded rate increases exceeding 25 percent by October. Nearly 1,000 customers in the North Marco Utility will see a 50 percent increase in their wastewater base rate.

If approved, master-metered condos, which are condos with one meter for all units, would see an average increase coming in October of about $15 per month per unit.

Customers in many of the island’s areas aren’t pleased with the prospects. Others, such as Amadeo Petricca, have said previously that it’s way past due.

Craig Woodward, president of North Marco Utility, which is privately owned and pays the city for waste water services, said there are more than 800 customers in his area who can’t absorb such hefty increases.

Woodward wasn’t able to speak on Monday because public input was cut short due to time, but council will hold another public workshop in June.

“I’m going to have 800 people here,” Woodward said after the meeting.

“It’s not coming down the pipeline, that’s why I’m here,” continued Woodward, who is also an attorney on the island.

Rate structure change proposals come from the notion that the utility needs to make up for five years of not changing the rates to ensure the utility, purchased in 2003, is covering its fixed costs in the most equitable way possible. Fixed costs include pipe maintenance, plant upkeep and paying off the bonds from the city’s purchase, among other expenses, that don’t change based on the amount of water used.

Several council members said they were skeptical about the proposal.

Councilman Larry Magel said he thought cost based on usage was most equitable.

That idea doesn’t work with a utility that has expensive fixed costs, said Rob Ori, the city-hired consultant from Public Resources Management Group. Currently 80 percent of the utility’s costs remain even if no one used any water, he said.

The proposal brings the current base rates up from covering 42 percent of the utility’s fixed costs to covering 50 percent of the utility’s fixed costs. It won’t bring in additional money to the utility, but makes more of the revenue steady while usage is steadily declining, Ori said.

Covering all of the fixed costs in the base rate would be too astronomically high, he added.

Councilman Bill Trotter said that in that sense, the proposal may be a compromise.

A base rate that covers much of the fixed costs reduces the financial risks for the city and is favorable for bonding, Ori reported.

If council approves the recommendations, customers in Key Marco, Goodland and Marco Island’s single family residential users could see a relative relief in base rates, but either way, officials said, rates need to go up for everyone.

View the utility rate proposal in related documents to the upper left.

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Comments » 24

sailingalong writes:

The single family homeowners have been subsidizing the resorts and condos for years. That is the key to Arceri's power. As long as the condos elect Arceri's candidates such as Gibson, Waldack and Trotter, they will protect this unfair allotment of rates. Hopefully the new council will finally correct this gross injustice. Butch Neylon ran on establishing a fair rate structure and it was a rallying cry for the condos to vote against him. Arceri convinced the condos and resorts that if Neylon got in their rates would go up 35% as well they should have.

deltarome writes:

You can tell who's interest Magel is looking after!! Certainly not condo owners on individual meters and certainly not home owners.
Nothing like a little sensationalistic news articles to divide Marco again.
With any increase in prices comes less demand,which further increases prices to cover lost revenue and on and on.

blogsmog writes:

Things we can depend on on Marco;
snowbirds start showing up around Jan. 1st. Sea turtles nest every spring on our beaches and John Aceri and his cronies show up with donuts & coffee @ condo associations every election year.

ajm3s writes:

Let us now get some popcorn and enjoy the show.

Let us now see the real challenge to the new council in its review of a fair and equitable way of dealing with utility costs. It is time to stop the subsidization of utility costson the backs of single family residences. It is that obvious.

It is not that difficult of a challenge if you approach it in a fair and balance way and not based on the Marco Island "lobbyist" viewpoint.

chicky writes:

Question? Now that I am on city sewer, can a sub meter be installed on my lawn sprinkler system so I do not have to pay sewer charges on water that does not go down the city sewer??

NobodysFool57 writes:

Many of the projects behind these rate increases are to expand and increase capacity at the water and wastewater treatment plants, even in the face of decreasing demand. Larry Magel knows this from serving on the ad-hoc Utilities Committee. It's time to get rid of Rony Joel, (formerly of Camp, Dresser, & McKee, a utility construction contractor) before his loyalties to former associates drive us into insolvency.

deltarome writes:

Actually, there are no overall revenue increases. Council has set revenue needs for next two years and that is built into rates that are to rise over next 4 years.
This is just a realignment to make the rates more fair and equitable. Those paying less obviously want to keep it that way-those on master meters in condos have the best advantage and the Marco Mafia who put their men on council, are asking for the favor to be repaid. A delay in evaluating this, essentially perpetuates the advantage for a select few.

iHeartBeaches writes:

If approved...

Who the heck are they kidding? When was the last time that a water rate increase went up for vote and it DIDN'T pass? Never, that I can recall.

Ever since the City has taken over the water utility my rate has gone up by about 700%. Before the City took over my monthly bill averaged $125/mo. Now, it averages $795/mo.

In my other home (up north) I pay less than $100.00 for water and sewer combined -- on a heavy month.

I realize that Marco Island has the elitist mentality... if you can't afford to live here, move. But why should we be paying 7 times the amount that most of the country is paying for water? It seems crazy to me.

iHeartBeaches writes:

in response to deltarome:

Actually, there are no overall revenue increases. Council has set revenue needs for next two years and that is built into rates that are to rise over next 4 years.
This is just a realignment to make the rates more fair and equitable. Those paying less obviously want to keep it that way-those on master meters in condos have the best advantage and the Marco Mafia who put their men on council, are asking for the favor to be repaid. A delay in evaluating this, essentially perpetuates the advantage for a select few.

This is true. The condos have had the benefit of a MUCH lower rate for quite a long time.

If you remember, when the "tiered" rate went into effect... conveniently the condo owners were exempt from that (significant) rate increase.

marcofriend writes:

in response to chicky:

Question? Now that I am on city sewer, can a sub meter be installed on my lawn sprinkler system so I do not have to pay sewer charges on water that does not go down the city sewer??

No you can't. If they did anything, it would be to put a separate meter and then you would be charged another base charge which would be more than it is worth.

flaman writes:

They don't call it Markup Island for no reason.

MrBreeze writes:

What a scam, just another squeeze by the City and friends.

Explain this, also my bill in the North with water and sewer is less than 50.00 dollars per month. Here on Markup Island my bill is 50.00 and not a drop of water is used that is just to have the meter in place.

And to raise that, what a rip off. They need to fire Joel and get this under control.

In response to Chicky. In many cities you can install a "water only" meter for irrigation. This meter then reads that use and Sewer charges are not applied. Many industries use this where water is not disposed in the sewer. I do not see why we do not have it on Markup Island.

chicky writes:

I looked in to other cities and counties around the country, and almost all have a sub meter system. Many people hook up their hose connections for watering, car washing, pool filling, sprinkler systems etc. All of which does not go down the sewer. This can save a condo, or homeowner hundreds if not thousands of dollars annually. A sub meter is a very easy installation, and a remote meter reading device can be installed right on your house for the city to read. This needs to be looked into by the council that is supposedly looking out for our interests.. We should not be charged sewer charges for water that is not going down the sewer nor being processed at the plant. I would be more than willing to pay a plumber, and any necessary permit and inspection fees for this device. Please urge our council to look into this!!

Stilllaughing writes:

I guess buying the water company wasn't that great of an idea now.
It all comes down to greed - vote for the guys who promise you the most. Unfortunately, reality raises it's ugly head and we all get stuck in the shorts because there's no way to pay for the promises made (LIES).
If our councilmen really cared about the citizens, they'd sell the water utility to some company that actually knows how to run one and not have the safety net of being able to raise rates because of their incompetence.

iHeartBeaches writes:

in response to chicky:

I looked in to other cities and counties around the country, and almost all have a sub meter system. Many people hook up their hose connections for watering, car washing, pool filling, sprinkler systems etc. All of which does not go down the sewer. This can save a condo, or homeowner hundreds if not thousands of dollars annually. A sub meter is a very easy installation, and a remote meter reading device can be installed right on your house for the city to read. This needs to be looked into by the council that is supposedly looking out for our interests.. We should not be charged sewer charges for water that is not going down the sewer nor being processed at the plant. I would be more than willing to pay a plumber, and any necessary permit and inspection fees for this device. Please urge our council to look into this!!

The City isn't interested in looking into this option, because it will lower their revenue source.

blogsmog writes:

in response to Stilllaughing:

I guess buying the water company wasn't that great of an idea now.
It all comes down to greed - vote for the guys who promise you the most. Unfortunately, reality raises it's ugly head and we all get stuck in the shorts because there's no way to pay for the promises made (LIES).
If our councilmen really cared about the citizens, they'd sell the water utility to some company that actually knows how to run one and not have the safety net of being able to raise rates because of their incompetence.

Great point!
Aceri has royaly screwed ALL of us! Its time to throw the bums OUT!
P.s. Thank you Mr. Keister, Batte, Recker and Magel for having the huevos to do whats right for our citizens.

blogsmog writes:

Klaber; never say 'done', these guys have made millions off the backs of the Marco taxpayers, they're not just going to walk away from the 'nipple'.

MKL writes:

This should not be about condos vs. individual homeowners. It seems to me that the 'per unit' rate that is being proposed for multi-family dwellings should require a meter for each unit. Right now, there is one meter for potable water - the bills are divided evenly among all owners in a multi-family building with only one meter being used for each type of water source - gray water, potable water and in some cases - pool water. This means a quick read by the meter reader. If you want true equity - put meters in each unit. Please consider that some of the costs involved in the per unit rate are the meters and the salaries paid to meter readers.
The proposed water rate increases are beginning to have an effect on owners' abilities to maintain and improve their properties. We are not an endless supply of money needed for the water utilities. In this struggling economy, it seems to me there should be more consideration of how difficult it is for owners to maintain their properties and pay their bills. I implore the city council to think long and hard about these large increases being proposed. Our 'state of the art' water utility is turning into an unaffordable venture for many residents on Marco.

ajm3s writes:

"Please consider that some of the costs involved in the per unit rate are the meters and the salaries paid to meter readers."

Isn't that the argument that was presented for justifying the lower rates for condo dwellers. I haven't done the numbers but I suspect the meter readers are not a significant cost relative to the total operating budget. I suspect energy, membrane replacement, and maintenance/capital cost to name a few items.

My suspicion is the water department is not run to minimize cost (increase efficiency) but rather to simply increase revenue and justify through upgrades and lamenting of the condition of the operations when transferred to city ownership.

Keep it simple $/gallon of water provided regardless of whether it goes through one master meter or individual home.

ajm3s writes:

One question: What was the total operating labor costs at time of purchase vs labor costs one year after? That should provide a quick thumbnail of the projection of costs before any major changes were instituted.

I may be clueless, but I am curious.

MKL writes:

Keep it simple $/gallon of water provided regardless of whether it goes through one master meter or individual home.
What a novel idea! Pay per gallon. Oh - but it seems that would be WAY TOO SIMPLE, doesn't it?

34145 writes:

Direct and to the point... obvious solution,MKL!!! Thank you

jwputnam writes:

You are missing the cost of the pinhole leaks created by Rony's elevation of the acidity level at the RO plant. Class action lawsuits are eventually sure to follow. I told of this problem several years ago when my son-in-law (doctorate in water sciences and water industry leader) visited the Island and reviewed the water quality documents supplied by the City. I reported THEN that he stated that the pin hole leaks were to be expected. Rony still denys culpibility, I believe. This is going to catch up to him. I have been told that MANY City employees were aware of the problem but were quieted effectively.

Don't you just love Marco?

ajm3s writes:

Science it is such a pesky thing. Rony is a man with a little knowledge but pretends to know more. Very dangerous.

In full disclosure he is a PE, but take it for what it is worth. (I believe he gives PE's a bad name).

Its the same logic as no one wants to go to a medical doctor who graduated last in his class, even though they are licensed. However, this doctor could be exceptional in practice.

My argument, I do not see that in Rony's performance record or decisions. In the end, professional decisions and job performance matters.

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