Toledo looks at monthly water rate billing

10/19/2011

The City of Toledo expects to implement a new billing system early next year that will allow households to pay for their water and sewer services on a monthly basis.

Toledo households now receive their water and sewer bills every quarter, but the Department of Public Utilities will move to a monthly cycle at the request of City Council. Details of the change have yet to be finalized, but the shift should happen in the first few months of 2012, waterways commissioner George Robinson II said yesterday.

The switch comes at a time of skyrocketing utility rates. Water rates went up 9 percent this year and will continue to rise through 2014. The city also increased sanitary sewer rates by 3 percent in February. Department head David Welch has indicated he will likely ask for a further rate raise by early next year.

Councilmen hope monthly bills will help households better manage these rate increases. City officials have estimated that the average customer who uses 3,000 cubic feet of water quarterly is paying about $186 this year, up from $164 in 2010. The bills, which will increase at lesser percentages through 2014 under the new rate structures, combine water, sanitary sewer, and storm water sewer charges.

“All of us on council have been asking for this for some time,” councilman George Sarantou said. “Because of the increased rates we know it’s difficult for people to come up with a quarterly billing payment, and going on a monthly basis would a be a lot easier.”

The department of public utilities is discussing continuing to send its bills out quarterly, Mr. Robinson said. However, under such a change, those bills would be broken into monthly installments with separate invoices to accompany each scheduled payment, the commissioner stated. He said the monthly system would bring water and sewer bills into line with other types of household bills such as those for mortgages, phones and cable television.

“It helps families with budgeting and makes it easier to handle those types of bills,” he indicated.

The department is also hoping to secure council’s approval of a $700,000 upgrade of its billing software. The current software is out of date and needs to be upgraded before 2013 or the city could lose hosting and maintenance services for the billing program, called SAP, department officials maintain. The upgrade would involve hiring three people and would take between nine and 12 months.

Councilman D. Michael Collins slammed the proposal yesterday as an unnecessary expense, particularly given the environment of rate increases. He said the utilities department should instead merge its billing system with a separate one run by the city. That system, implemented under the previous administration, cost the city $15 million, the councilman said.

Mr. Collins questioned the need to have two separate billing systems that both run on the same type of software. The systems are supported by two different server hosts at a cost of $1 million a year. The city also pays for separate consultants to maintain the two systems.

“If we are spending money to the extent that I’ve just tried to highlight ... ultimately it’s going to be the ratepayers who are responsible for those funds,” Mr. Collins said. “It makes no sense... We need to get rid of the duplication.”

But Mr. Robinson and deputy mayor Steve Herwat replied that merger discussions are already under way. However, the city’s main billing system already runs on the upgraded software, so the utilities department must upgrade, too, before any merger can take place, they explained.

“It’s a progression, it’s baby steps,” said utilities department consultant Todd Moser, who also weighed in on the discussion. The proposed upgrade “is needed,” he added.

Mr. Collins expressed doubts that the merger would actually happen.

However, Councilman Sarantou said the $700,000 would need to be spent for the upgrade regardless of whether a merger happens. The amount would come from the Sewer Replacement and Water Replacement funds, and has already been set aside in the Department of Public Utilities’ budget.

Contact Claudia Boyd-Barrett cbarrett@theblade.com or 419-724-6272.