Garland to forgo $500K a month in water revenue to rethink apartment rate hike

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The Garland City Council on Tuesday pulled back on a planned water rate increase for some 18,000 multifamily homes.

The city will miss out on more than $500,000 a month in anticipated revenue starting Jan. 1, when apartments and condos were to be billed per unit, rather than per connection.

The council passed the change in September with its 2018-19 budget. Since then, amid a mounting backlash, members have pressed city staff for clarity and admitted their own confusion.

"You’re talking about rate methodology, which is not a simple subject," said City Manager Bryan Bradford. "I think there are quite a few points that need to be covered in quite a bit of detail to allow both the citizens and the council a comfort level about where we’re going with this."

Complexes with 300 or more units may have only 25 water connections. As a result, under the present system, multifamily units account for 14 percent of the city’s water usage, but only 6 percent of its water revenue.

But those who run the complexes say the flat charge that was to take effect, averaging about $31.60 a month, isn’t a fair solution.

"I think there’s a general agreement that pricing for apartments is outdated. I get that," said Norm Bjornes, the developer behind the 341-unit Oaks Fifth Street Crossing apartments downtown.

He said that Garland, however, has not addressed the cost differential in delivering water to apartments.

"I think it’s reasonable to ask what is the cost of delivering water to our little two square blocks that we pay all the infrastructure costs of after it gets to Garland water’s meter," Bjornes told the council, "And what does it cost to deliver water to 341 houses in Garland that might cover 2 square miles?"

Bjornes asked the city to meet with his industry’s leaders to find a fair increase, whether it be per unit or by consumption rates.

The Apartment Association of Greater Dallas, boasting 80 percent of Garland’s complexes among its members, also opposed the increase.

"The way that this proposed change was implemented with little to no notice to the apartment association or our members is very disappointing," said Jason Simon, director of government affairs for the apartment association. "We urge you to amend the rate for water and wastewater, bring it in line with other cities in North Texas, and we want you to phase the increase."

The council included the direction to work with Bjornes, the association and others when it delayed the increase by a 6-3 vote. Council members hoped Bradford and city staff would have new recommendations by mid-January, but the city manager warned that may not be enough time.

And as word of the planned increase spreads from apartment owners who were given the city’s notice in mid-October to the tenants who will likely absorb the payment, the city is now hearing from a steady stream of low-income residents for whom paying an extra $31.60 a month will be painful.

"This means a hardship," said Camelia Dennis, who testified she has no washer or dryer, no yard to water and spends relatively little time in her one-bedroom apartment. "I work too hard. I just don’t need an increase in my life."

Andrea Rodriguez was one of about 50 who came to City Hall to protest the proposed rate restructuring. She recently left one Garland apartment where her water bill was $40 in favor of a smaller place and now faces losing all the monthly cost that she saved in the move.

"The apartment office sent us all emails and said, ‘This is how much your water bill is going up, starting next month’," she said. "Mine’s about $33. It’s just way too much."

The council agreed that residents were blindsided and changed course after voting 5-4 against reconsidering the planned increase in November.

Deborah Morris, Garland City Council member

"This isn’t something that the apartment residents did wrong. This isn’t something they knew about," said council member Deborah Morris, who along with Jerry Nickerson brought the item back for reconsideration. "This was a failure on our part to communicate clearly."

There was also some outrage among owners of Garland single-family homes, who learned that their bills have been subsidizing those of apartment dwellers for about 15 years.

"Individual homeowners and even people who rent homes have been footing the bill for apartment complexes this whole time," said Erick Howell. "Everybody who thinks you guys are trying to raise the rate to be unfair or penalize people in apartment complexes, I don’t see that at all. You’re trying to be equitable."

Two of the three council members who opposed the vote — Rich Aubin and Jim Bookhout — said that if the city was to re-examine the new multifamily rate structure that was part of the 2018-19 budget, it should also look at paring back on the $1.4 million in rate increases that single-family users had been hit with in the same budget.

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