Nearly two million residents in the Baltimore region will be paying higher water rates today after the Baltimore City board of estimates approved a 9 percent hike on Wednesday.
The decision delays the much-anticipated three-year, 27 percent increase. The increase impacts residents in Anne Arundel, Baltimore, Howard and Carroll counties because the city provides water to those areas.
The decision to delay the larger increase follows a report from the city comptroller?s office that said the rate did not have to be so high.
“Based on an analysis of past expenses and projections, we believe increases can be reduced,” said Gail Adams, an independent auditor from the comptroller?s office. Adam?s audit recommended raising water rates 4 percent over the next two years, and 9 percent in 2009.
Officials for the Water Bureau said that unpredictable costs such as future retiree health benefits and higher energy prices meant the proposed increases were necessary.
“Even though we make our best effort, we can?t predict all costs in the future,” city water bureau director Jay Sakai said. “We need to insure that we have enough money to meet all our obligations.”
Sakai cited a 2002 federal consent degree that required costly upgrades to the city?s water system, as well as adequate money to insure prime rates for future bond issues that will be used to make improvements.
“We have unfunded mandates from the federal government that have yet to be met,” he said.
Sakai also said Baltimore has some of the lowest water rates in the region.
“Only New York City has lower rates than Baltimore,” he said.
The board?s approval of a one-year rate increase was prompted by Mayor Shelia Dixon, who urged the board to approve the rate increase for 2007, but withhold approval for future rate increases.
“Time is of the essence,” she said. “But we need to study this issue further and receive more information of what can be done to provide relief for city residents.”
