Water Utility Rates Raised 3.03%

Following a work session and public hearing regarding the city’s utility system, City Council approved a 3.03% increase in utility rates during its April 10 meeting. The new rates will be effective July 1.

Looking at the average household’s use of water in Lebanon, city staff determined the current cost for five units of water is $122.08. With the rate increase, the costs would be $125.89, a $3.81 monthly increase.

“This is based on inflation, based on where we think we’re headed in capital,” Engineering Services Director Ron Whitlatch said about the methodology for determining the rate increase.

Comparing Lebanon’s rates to 20 other Oregon cities, Lebanon ranks number four, flanked between Sweet Home at number three and Newport at number five. Of the 21 cities, the average rate is $108.43.

A staff report indicated the “rate adjustment will cover increase in operational costs and help offset the increased cost for constructing capital projects.”

Approaching the council with questions regarding the increased water rates, Alicia Van Driel asked the council what is being done to make sure funding is set aside for future infrastructure given that, according to her understanding, residents were stuck with the bill for current unplanned infrastructure.

Considering increased development in the past 10 years, she asked if the system development charges (SDC) from those developments were going toward the water department or if residents are strictly responsible for that infrastructure.

Whitlatch explained that developments are responsible for infrastructure for their developments and there are specific guidelines as to when SDC fees can be charged. He further explained what residents see in their water rates is “intended for capital replacement, not necessarily for capital improvement.”

Responding to another question, Whitatch said the city has not received any grants for the water system in the past five or 10 years.

“The residents do pay pretty high water costs according to a lot of other places in the rest of the state,” Van Driel said. “A lot of us do feel there should be other funding for it other than just out of our pockets because in the past they did not account for that and so we’re making up for a lot of years where that didn’t happen.”

Jenny Lynch also addressed the council with her concerns, expressing she is on limited income and that if the city charges a fee for water service, then she will be paying the same fee that higher-income households would be paying. Instead, she seemed to suggest the city could charge a percentage based on property taxes so she wouldn’t have to pay as much as higher-income households.


City councilors discuss issues regarding utility rates, property tax options for affordable housing complexes, and RV and parking problems during the April 10 City Council meeting.
Photos by Sarah Brown

Community Development Director Kelly Hart provided information about potential impacts in regards to Crossroad Community’s request last month for a property tax exemption program on nonprofit affordable housing properties.

She shared there are several tax abatement programs that are or could be implemented, and she identified 11 known affordable housing developments in the city that are using some sort of tax abatement program. Three of those properties would be eligible for the requested tax exemption program if the city adopted an ordinance for it, but one is already using a different program that exempts them from paying property taxes. Between the two other properties, there is $19,471.05 contributed in property taxes, providing about $12,000 to the General Fund.

If the city adopted the requested program, other developments could build and take advantage of the exemption. Hart identified nine properties in Albany that have used the same program in the last 30 years, and noted it is not a widely used program in that city because properties opt to use other tax abatement programs instead.

During discussion on the matter, Councilor Jeremy Salvage said he compared two similar complexes, one of which was receiving a special tax program for being affordable housing, and found there was about a $135,000 discount in property taxes on the affordable housing complex.

“There’s already a massive tax break that’s available, so I’m a little bit leery as we’re talking about the budget we’re already struggling with and we’re trying to find more sources of revenue,” Salvage said. “I know it’s just a small amount now, but that $20,000 (referring to Hart’s earlier example) could easily be $100,000 that we’re giving up in the coming years, and I’m not sure right now’s a great time to do that.”

The council asked to revisit the matter again in September or October.


In other business:

  • During a work session, Whitlatch and Public Works Director Jason Williams presented an update on the city’s water and wastewater systems, including water and sewer line repair projects and preparation for the next deep drawdown at Green Peter Dam, which is expected to once again create high turbidity in the water.
    Whitlatch reported the water, wastewater and storm drainage systems are on track to be at or above revenue projections, and expenses at or under budget.
    “The great thing about utilities (is) we budget for projects and things, and if we don’t get to them or we use less, that all goes right back into the fund and can be used in a different way,” he said.
  • James Gold, related to a club or business at 96 E. Sherman St., told the council they would like to do a block party downtown. According to Goold, last year they held a block party and raised enough money to feed four families for Thanksgiving. They also do fundraising for veterans.
  • Rod Sell, of Build Lebanon Trails, informed the council they are going forward to build the Georgia Pacific Mill Race trail. BLT intends to donate the trail to the city after it is completed. Sell said he requested $25,000 from the Tourism Committee at the Chamber of Commerce to help build the trail and was awarded $1,500. He said he was not aware there was “another pot” of potential funding through the city’s transient room tax fund, from which the Chamber was recently awarded $100,000 to renovate their building, so he wanted to know if the council would help BLT with their project from that same pot.
    Whitlatch responded that there is some question among staff regarding whether transient lodging tax funds can legally be used for trail systems, as they are earmarked for tourism-related purposes. Staff will talk with the attorney for further clarification and return to council with a report on the matter.
  • Approved a resolution updating policy and guidelines for the Private Sewer Lateral Replacement Assistance Program. Council approved this resolution last month, but it had the wrong attachment to it.
  • Councilors KJ Ullfers and Dave Workman were assigned to an advisory committee that will review housing production strategies that will be implemented by city staff.
  • Council approved an ordinance allowing designated enforcement officers to cite individuals for civil trespass. Attorney Tré Kennedy explained current code allows only sworn police officers to offer such citations. He specifically mentioned the inability of school resource officers to do so, noting they have to call a sworn officer to go down to the location to make the citation.
  • Approved a resolution opting in to recreational immunity pursuant to new Oregon statute 105.668.
  • Interim City Manager Ron Whitlatch’s monthly report indicated staff are determining the feasibility to move City Council Chambers to the library’s community room. They are figuring costs for a new dais and IT improvements for the room.
    Also, staff initiated discussions with Lebanon Farmers Market regarding moving them to another location next year, and construction for the rapid flashing beacon at Tennessee Road and Beaton Lane is expected to begin this month.
  • Salvage informed the council he met with some residents on East Elmore Street where parked cars and transient broken down vehicles/RVs are parked along the street, causing traffic flow problems. He said the vehicles/RVS are towed out and then back in, and garbage is left out.
    After some discussion, staff said they would investigate options the city could consider regarding RVs and no-parking options, and will bring it back to the table at a future meeting.