City set to reinstate sewer fee hikes to repair pipes

Fixing sewers isn't the most glamorous job in Las Vegas, but it's one of the busiest in recent years.

Not only is the city in the midst of a decades-long effort to evaluate hundreds of miles of underground pipes, it is preparing to reinstate inflation-related fee adjustments after deferring about $11 million in increases over the past three years.

The potential fee increase, repair drive and a description of how workers can fix underground pipes without digging holes or trenches were part of a recent presentation to the City Council.

The council, especially Councilman Bob Coffin whose Ward 3 includes some of the oldest parts of Las Vegas, wanted to learn more about the status of the city's sewer system and how maintenance and repairs could help avert leakage, backups and other emergencies in the future.

Coffin said sewer rate revenue, which goes into a special fund, needs to keep pace with the cost of maintenance so the city doesn't have to dip into general fund revenue to pay for future repairs.

"I think we are going to fall behind, and I hate to think we would have to go to the general fund to supplement the enterprise fund," Coffin said. "It is kind of an ugly subject ... but (ratepayers) need to know because they are writing checks. They need to know we are doing smart moves."

Public Works Director Jorge Cervantes and project manager Tim Parks walked the council through the city's sewer situation in a presentation that outlined tens of millions of dollars in repairs identified through an ongoing citywide inventory and a method of fixing pipes without digging, a process that can cut costs up to 40 percent.

The council also heard a presentation about an insurance program for residents that would allow people to buy protection for homeowner-owned sections of pipes, generally those between a home and the city pipe under the street.

According to Cervantes and Parks, the city is five years into an evaluation of more than 200 miles of large pipes and more than 1,500 miles of small pipes.

The first four years identified nearly $73 million in needed repairs, according to the presentation.

Parks said the cost of the repairs can be covered by revenue from sewer customers.

"We have been able to self-fund all of our repairs," he said.

One of the ways the city has stretched its repair budget has been to hire a contractor to make the fixes without digging up the old pipes.

Workers put a special sock in a damaged pipe that is filled with a warm epoxy. When the epoxy cools and cures, the sock can be removed and the pipe is lined with a hard, plastic-type surface.

"What you're essentially left with is a pipe within a pipe," Parks said of the result.

In addition to fixing pipes without digging, the city has stretched the sanitation enterprise fund by postponing construction of an $80 million wastewater treatment plant, he said.

"That actually freed up quite a bit of money for us that allowed us to do more of these rehabilitation projects," Parks said.

But even with the savings, the city probably will reinstate inflation-related rate increases that City Manager Betsy Fretwell postponed as the economic recession gripped Las Vegas and much of the nation.

From 2010 through 2012, Fretwell declined to implement increases of about 2.4 percent annually, a move that cost the fund about $11 million but saved the average homeowner about $6 per year.

Business rates vary dramatically but are generally calculated by multiplying the number of fixtures by 1.33 equivalent residential units, or ERUs.

For example, a large restaurant with seating for more than 45 people could pay nearly $10,000 annually.

While city officials are considering reinstating the inflation adjustment for 2014 to make sure revenue keeps pace with repair costs, the presentation also included an upcoming program that would help residents insulate themselves from unexpected repair costs as well.

It's through a proposed partnership between the city and Utility Services Partner, a private company that would offer insurance against repairs.

Cervantes said residents, especially those in older homes, can be surprised to learn tree roots or other hazards have damaged the pipes between their home and the street.

The cost to repair, which can be in the thousands of dollars, falls to the homeowner.

"The vast majority of folks do not realize they actually have ownership of some of that," Jeff Olson of Utility Services Partner said of privately owned sections of pipes.

If the city approves a deal with the company, residents could buy insurance for a small monthly premium as a hedge against costly repairs , Olson said.

"What we are trying to do is offer homeowners a way to avoid a large expense."

Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-383-0285 .