June 18, 2024 

To: Flagstaff City Council and Water Services Staff

From: Michele James, Friends of Flagstaff’s Future 

Subject: Proposed Water, Wastewater, and Reclaimed Rate Increases (Council Agenda Item 10A)

Friends of Flagstaff’s Future (F3) would like to express our thanks to the Water Services staff for taking the time to discuss with us the details and decision-making behind the proposed water rate increases over the last few months. Staff input assisted us in our understanding of how the rate study worked and the factors considered that determined the proposed rate increases, as well as why rate increases are needed and how these rate changes would impact the Flagstaff community through December 2029. 

F3 understands that the proposed water rate changes include a decision that increased equity efforts by adding a fixed month meter charge for wastewater, thereby spreading system-wide maintenance costs to residences that are not occupied year-long. Also, we approve of the decision to encourage water conservation by a reduced water base fee in combination with modified water volume charges.

Last month Council responded to concerns expressed by many in the community regarding the significant five-year increases in single family residential customer rates by reducing the overall percentage of funded CIP projects and increasing debt. This resulted in single family residential water rates decreasing from an 81% increase to 49%, and wastewater rates decreasing from an 144% increase to a lower 99% increase. F3 appreciates these efforts to respond to community concerns.

However, as we stated in the May 21st Council Work Session, F3 continues to be concerned about the ability of lower- and fixed-income households to absorb the increases in water and wastewater rates during the next five years. These community members could be significantly impacted by past decisions to delay maintenance projects at treatment plants and to prepare for future growth.

While Council decided not to modify this rate study to address water equity, F3 hopes that shifting the burden of rising water rates away from low income residents will be considered with the next water rate study. We do believe though that we can do something about the equity issue now. According to the US Water Alliance, water equity occurs when all communities have access to clean, safe, affordable drinking water and wastewater services. F3 would like to see the City of Flagstaff review and begin to implement the practices outlined in Advancing Racial Equity Across the Water Sector: A Toolkit for Utilities (US Water Alliance) as well as looking to other cities who are implementing water equity practices. 

The Toolkit recommends modifications in five areas including assistance and affordability and collection practices. We want to highlight that the recommendations in these two sections include expanding access to and funding for low-income assistance and affordability programs.   And, implementing income-based programs to prevent shutoffs, liens, and other punitive practices for customers with financial barriers. 

Strategies to improve assistance and affordability include ensuring that low barrier, highly visible, and easily accessible assistance programs are available and that customers in need are proactively linked to assistance, and that programs are created to ensure continued funding for assistance and relief funds.

Strategies to modify collection practices can include raising the debt threshold that triggers a shutoff or lien, immunity for customers enrolled in assistance programs, minimizing the use of or completely eliminating shut offs, liens, and other punitive practices for customers who are unable to pay their bills.

The Customer Assistance Rack Card prepared by Water Services is a good starting point and this information can and should be provided to all customers and accompanied by a rigorous public outreach campaign. 

We would also like to see the city more holistically address assistance to those who cannot afford the rate increases by starting a process to implement the Toolkit suggestions we’ve outlined above. F3 believes that those most impacted by these rate changes should be included in a citizen committee, formed by the end of 2024 at the latest, to determine how to both generate emergency funding for those who cannot pay the increased water bills, and to modify collection practices and minimize shut offs for those with financial hardships. We encourage the City to look into ways that the Flagstaff community can assist our neighbors.

Thank you.