Friday, February 23 , 2018, 1:44 pm | Fair 59º


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Commercial Owners Push Back Against Goleta Sewer Rate Hikes

Sanitary district plan would see some building owners facing increases of up to 2,000 percent

A rate increase being considered by the Goleta Sanitary District could have some commercial building owners in the city facing up to a 2,000 percent increase in their rates, raising alarm among some in the business community.

The move is aimed at fixing inequities in the rate structures offered to commercial buildings, according to district officials, who say a small number of office owners have had artificially low rates, while other businesses, and the larger community, have subsidized them unfairly.

Those rates, and what to do about them, are at the center of a workshop being held Thursday at the district offices.

“It’s an equity issue,” district General Manager Kamil Azoury told Noozhawk on Tuesday.

The district hasn’t changed its rates since 2009, and is increasing them by 4 percent for all customers — to deal with inflationary costs such as labor and chemicals the plant uses.

There’s a second piece to the puzzle, though. The district discovered last year there was a big gap in the way it charged commercial offices in the district. Some offices were charged 3 cents per square foot, while others were charged a whopping 74 cents for the same area.

Azoury and his staff spent about nine months trying to figure out why that was happening, and saw that the rate structure was outdated.

Office buildings that had lots of walled-off individual offices were being charged more than those with an open floor plan that just happened to have lots of cubicles jammed inside.

Now, they’re defining an “office” by every 500 square feet, and calculating the rate according to the amount.

There’s also been a redefinition of water use for offices.

The district doesn’t have the technology to measure water usage via meter for each office, and some share meters, making it logistically impossible to assign usage to each office.

So each office is given an entitlement of water, and Azoury said that the district will be giving a water entitlement of 100 gallons a day per 500-square-foot office.

Some offices use more than that, he said, and some use much less, but it tends to equal out. That approach creates inequity, and is a shortcoming of the flat-rate system, but most California cities use it, he said.

About two dozen offices would see their rates rise by more than 30 percent as the rates adjust, and for those users, the district has agreed to phase in the increases over three years.

Everyone will be charged the same rate of 28 cents per square foot, but those who were paying a low cost to begin with will certainly feel the pain of an increase.

“They’re entitled to be upset and concerned… The whole issue here is that we’re trying to address this inequity in the system,” he said. “It’s kind of like your neighbor has been paying for your gardener and then they stop and you are left with the bill.”

One of those facing an eyebrow-raising 850-percent increase is Jeff Bermant, whose 80,000-square-foot Goleta office building would be slammed with higher costs.

Bermant estimates his bill will go up from $4,738 a month to over $40,000 a month on his Hollister Avenue building.

“It seems rather unfair,” he said. “They just decided to slam office buildings. We were the easiest target.”

Bermant said he and others in the business community were taken by surprise. A workshop was held in May on the increases, but no one from the business community showed.  Bermant said that the outreach wasn’t properly noticed, but that he and others plan to sound off the plan Thursday.

“Our biggest concern is that it doesn’t seem to be tied to the facts on the ground,” he said.

Bermant said the entitlement for his building will increase from 2,400 gallons a day to 16,000 gallons under the new plan.

“Many of us are scratching our heads,” he said. “It doesn’t coincide with the usage.”

That increase ultimately will get passed along to the tenants, he said, or the owners will have to make up for the costs themselves.

Bermant also raised questions about the increase in light of Prop. 218, and said he’s dubious the district can legally assign a higher rate to his property than what is actually being used.

Thursday’s meeting begins at 2 p.m. at the Goleta Sanitary District Office, 1 Moffett Place in Goleta.

The agency’s board will then make the decision on the increases at its July 2 meeting.

Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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