Civic

Asheville Council Approves Rate Increases

New Budget Director Tony McDowell (top, center) prepares clear budget reports that don’t leave reporters guessing about parameters.

Asheville – By way of three resolutions, Asheville City Council approved rate hikes for FY2021-2022. The measures were approved unanimously, except for water rates. Only Councilwoman Kim Roney objected, citing desires that high-volume, commercial users pay more than residents and that the city’s fee-in-lieu program make sure meaningful sidewalks get built.

On the former, staff explained only 8.54 percent of the city’s water users are commercial properties; 0.02 percent, manufacturing. Still, there was discussion about, if legally possible, charging more for multifamily residential developments than single-family houses. Nobody shares statistics about homeownership rates among the economically depressed or discuss how landlords get the money to pay their utility bills.

The city has been working with Raftelis, the company that usually handles consulting for the water system, to develop a new rate structure for phasing in cost recovery for the elimination last year of the system’s capital improvement program (CIP) fee . Following a rash of class-action lawsuits statewide, impact fees for water and sewer services are now considered illegal. Asheville was involved in two lawsuits. The city agreed to pay $2.1 million in settlements and sustained annual revenue reductions of about $7.5 million.

The city has a three-page report to help customers estimate what they will be paying. In general, water fees dropped this year due to the elimination of the CIP fee and the city leaders’ compassion toward people of COVID devastation. To reduce sticker shock, the city will divide the restoration of charges over two years, and it has shifted the balance of base and usage fees to align more with the council’s concepts of equity. In general, the rates remain somewhat lower than those of comparable municipal water systems in the state.

Other Changes –

Budget Director Tony McDowell described additional changes to the fee schedule as “minor.” Among these, parking rates in city garages will return to being free for the first hour but will cost $2 for every hour thereafter. Fees for losing parking access documentation will also increase. In addition, the city is arranging for more monthly and overnight options. These changes are expected to garner another $430,000 next year for the city.

Admission fees at the WNC Nature Center will increase by $2 each for city residents and $3 each for nonresidents. The fees are justified because current admission rates are below the national average for comparable venues, and the city’s contract with Friends of the Nature Center will not be renewed. The contract provided  $150,000 annually, and the new rates are expected to cover that with a little extra to reduce the city’s annual appropriations from the fund balance.

Another change is in advertising fees for city buses. Ads have been bringing in $2,000 – $5,000 annually, and just mentioning changing fees lets the public know this option is available. The rates have been $20 per bus per month since 2008, and that’s only 20% of what some similar transit systems are charging. The new schedule raises rates 33%.

Council adopted a more complex schedule of changes for fire inspection fees. The current fees cover periodic building inspections, pyrotechnic and burning permits, and “renting” of fire personnel and apparatus for events. Fees have not been adjusted in a decade and are not considered sufficient to recover costs of administration, which includes using a third-party billing service. In addition to increasing rates, staff restructured the rating system in the interest of equity. For some structures, it makes more sense to charge on a square-footage basis than building capacity. The city expects the changes to collect an additional $30,000 a year.

The city has created new fees for design review in special areas. The first is for subdivision development in historic districts and historic landmarks. Set flat at $260, the fee is designed to recover 55 to 60 percent of the cost of reviews by the Historic Resources Commission newly required by changes to the city’s Unified Development Ordinance (UDO).

The second would expand the existing $1,500 fees for major projects in the Downtown and  River Design Review Areas to include major projects in Hotel Review Areas. It would also impose a $50 fee for the now mandatory review of minor projects in any of those areas. Due to the rarity of projects requiring either kind of review, the city is not expecting to bring in over $10,000 a year with these fees.

In another area of interest to developers, fees in lieu for sidewalks will be changing. These allow developers to pay the city a fee instead of constructing sidewalks required by zoning codes. To take advantage of the option, however, a project must meet criteria now specified in the UDO and designed to encourage developers to go ahead and build the sidewalks. Collected fees are used to construct sidewalks in other parts of the city.

New fees in lieu, instead of simply charging by the linear foot, now charge by the square foot, considering the width of sidewalks that zonings require. They also include the cost of any retaining walls, curbs and gutters, ADA ramps, or rails that would have been needed on-location.

Council also approved continuing its policy of offering 501(c) nonprofits a 75% discount on property use and permit fees for events. Stormwater and sanitation fees were not changed. While staff considered increasing stormwater fees $0.16-$0.35 per month and solid waste collection fees $2 per month, they are now recommending more data collection and analysis before an inevitable increase next year.

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