Questions & Answers
Q: Why did the City initiate this evaluation?
A: The evaluation was initiated due to the age and condition of infrastructure and the inability to adequately address repairs and replacement with current funding levels.
Q: How were these infrastructure needs identified?
A: The identified needs were pulled from a variety of sources including maintenance records, master plans, condition assessments, and the City’s Strategic Operating Plan. Projects like master plans are multi-year projects that evaluate an entire system holistically against various planning criteria, design standards, and regulatory requirements. Master plans evaluate existing system needs and plan for future growth. Recently completed master plans for the Water and Transportation Systems went through robust public processes that informed the final plans, however, no complimenting funding plans to support the recommended capital investments were developed at that time. More information about the sources of identified needs can be found within the presentations provided HERE.
Q: How were priorities established?
A: Priorities have been identified in several ways. Master plans, the Strategic Operating Plan, and asset management programs all identify priorities. However, these sources don’t always prioritize areas of investment within various funding constraints. The purpose of the discussion series was to review competing priorities and identify what revenues were required to meet certain priority levels. Ultimately, Council set the tentative priority/funding levels but this is greatly informed by numerous technical evaluations, staff input, asset management strategies for the industry, and community engagement. Council’s priority discussion started with a questionnaire and the results can found in the March 7th Presentation provided HERE.
Q: Why aren’t existing tax revenues and City service bill payments adequate?
A: Property taxes aren’t used to fund public works activities. A portion of your property taxes do go to the City of Corvallis, but those revenues aren’t enough to cover public safety costs, let alone the suite of other City functions required to run the City. Rate revenue generated through City Services bills is restricted for use within the area it is collected. For example, revenues collected through the sewer portion of your bill can only be used within that utility. All our systems are aging, which increases the costs to operate the systems and address failing infrastructure. Over time, the basic costs to operate, maintain, and rehabilitate our systems has also increased at a rate that exceeds standard inflationary adjustments. Additionally, regulatory requirements continue to increase and, as a result, so does the cost of compliance. All these factors contribute to the need for securing additional funding. Comparisons between revenues and expenditures in each service area can be found within the presentations provided HERE.
Q: How do Corvallis’ rates for street and utility services compare to other communities?
A: When comparing street and utility charges between communities it’s common to use an average residential customer bill as the comparator. Information from other communities was last surveyed in August 2023. Using Corvallis’s current rates, and the August 2023 rates from other communities, Corvallis ranks 16th (with #1 representing the highest rates) out of the 21 communities we compared with. Neighboring communities of Albany, Philomath, Lebanon, Adair Village, and Sweet Home all charge more than Corvallis. Many of the communities we compared with will have considered rate adjustments since 2023. We update our comparisons annually and present them to Council as part of our annual rate evaluation and recommendation process.
Q: Has the Council already acted on the rate adjustments in the 5-year transition plan?
A: The Council has tentatively selected levels of capital investment and the 5-year transition plan necessary to generate the required revenue. The Council will take formal action on the first year of the 5-year transition in late 2024, for rates to be effective in February 2025. Council wanted to raise awareness throughout the community prior to taking formal action.
Q: When will the Council act on the rate adjustments in the 5-year transition plan?
A: The Council will take formal action on the first year of the 5-year transition in late 2024, for rates to be effective in February 2025.
Q: When the Council takes formal action, will they act on all five years or will they consider adjustments annually, consistent with past practice?
A: The intent is for Council to act only on the first year of the 5-year transition plan in late 2024. As we move forward, consistent with current practice, staff will provide reports to Council annually and make recommendations about further rate adjustments. In this way, Council can consider the rate adjustments annually against current conditions. In identifying a 5-year transition plan, Council is only identifying their intent based on the information available at the time. They are not “locking in” 5 years of guaranteed rate adjustments.
Q: In the provided material, when it references a specific rate adjustment “plus inflation” or “in addition to inflation” what does that mean?
A: This is referring to the fact that additional revenues are required to complete more work than we do today, not just keep up with the increasing costs to do the same amount of work. As an example, if inflation was 3% in a year, the total adjustment needed to keep pace with inflation and meet the 4% increase target would be 7% (4% + 3%).
Q: I am a “water-only” customer, does that mean that if the 5-year transition plan is implemented I should expect my bill to go up 4% plus inflation for each of the five years in the transition plan?
A: No, the 4% plus inflation referenced on the opening web page and the staff report for the May 23, 2024 Council Work Session is in comparison to the total city services bill for an average residential customer. An average residential city services bill includes many more services than just water. And the rates for each service area vary widely. Consequently, rate changes expressed as a percent in specific service areas may be much different than the percentage impact on the total bill. Therefore, if you are curious about rate increases in specific service areas (not just the estimated total bill impact) you can find that information in the April 18, 2024 presentation HERE. Additionally, you control a portion of your bill based on the amount of water use.
Q: I am a business owner and there was an error on the slide from the April 18, 2024 presentation that discussed bill impacts to sample non-residential customers, where can I see the corrected information?
A: The corrected information was provided in the minutes for the April 18, 2024 presentation. Please see Page 32 in minutes provide at the following link: https://apps.corvallisoregon.gov/webdocs/showdoc.aspx?docID=4257294
Q: Two scenarios were discussed in the April 18, 2024 presentation, which one did Council select for the five-year transition plan?
A: Council tentatively selected Scenario #2 and transitioning over five years.
Q: I already have trouble paying my City Services Bill, future rate increases would only make it harder for me. Does the City have any type of assistance program?
A: Yes, the City has established a City Services Billing Low-Income Assistance Program. To learn more, click on the following link: https://www.corvallisoregon.gov/finance/webform/city-services-billing-low-income-assistance-program
Q: The street in front of my house is in bad condition, if this plan is implemented does that mean it will get repaved soon?
A: Even with increasing rates through the 5-year transition plan, there won’t be enough resources to address every need throughout the community. The plan does envision an increased level of investment in local street improvements but obviously not all streets can be addressed first and there is a prioritization and coordination process that needs to occur. Priorities are routinely reorganized as more data becomes available and circumstances change, so it isn’t possible to pick a specific street and predict a year that it may receive a treatment. The City’s capital improvement program (CIP) document is a good source of information for upcoming capital projects and should Council implement the 5-year transition plan, future CIP’s will be updated to reflect the planned additional capital investment. The current CIP document can be found at the following link: https://www.corvallisoregon.gov/publicworks/page/capital-improvement-program.
Q: I can’t attend one of Council’s open houses, how do I provide feedback to City Council?
A: No problem, you can find information about how to provide feedback HERE.
