Your cost of living is going up — electric, natural gas, garbage and parking

By Elaine Goodman
Daily Post Correspondent
Palo Altans may be facing an array of higher fees in the city’s new fiscal year starting July 1, including a 10% to 14% increase in electric rates and a 4% hike in gas rates, under a proposed budget the City Council will vote on tomorrow.

Those rate increases would follow the council’s approval on June 19 of a 4% increase to base water rates. However, customers whose water usage has stayed steady since before the drought will see a decrease in their water bills of about 2% to 4% because a drought surcharge is being removed.

The council also approved a 5% increase to residential garbage rates this month. The monthly cost of a 32-gallon cart is going up by $2.38 per month, to $50.07.

Even with the proposed increases, electric rates for Palo Alto residents will be about 35% to 45% below PG&E rates, according to a report to the council from City Manager James Keene.

The utility rate increases are just one piece of the city’s overall budget for fiscal year 2018, which begins on July 1.

The council’s Finance Committee reviewed the budget during several meetings last month, making a few changes from Keene’s original proposal along the way. The committee voted 3-1 to approve the modified budget, with council member Greg Tanaka opposed. The full council is scheduled to give final approval to the budget tomorrow.

Tree trimming

The budget for the new fiscal year started with a $4.5 million budget deficit. On top of that, Keene added $2.3 million in spending. The initially proposed budget included cost-cutting measures, including a change to the city’s tree-trimming program that would have saved $338,000 a year, by pruning every 10 years rather than every seven years. But following Finance Committee discussion of the issue, tree-trimming will remain on a seven-year cycle and the $338,000 expense was added to the budget. The city spends $1.55 million a year on the pruning program, which encompasses 3,415 trees.

Dipping into the reserves

The revised budget for the city’s general fund now includes $210 million in expenses and $207 million in revenue. To make up the difference, Keene has proposed using $3.37 million from a reserve fund, an increase from $3.2 million that was in the city manager’s initial budget proposal. After the transfer, the reserve fund will be $38.9 million, meeting the city’s target of 18.5% of the general fund budget.

As the Post reported last month, the proposed budget includes a hefty hike to the price of parking permits used by downtown employees to park in nearby neighborhoods. The budget calls for a 56.7% increase in permit costs, bringing the total to $730 per year. The increase would also apply to workers parking in downtown garages. The goal is to raise $480,000 to give to the nonprofit Palo Alto Transportation Management Association, whose mission is to ease traffic congestion by reducing the number of downtown workers driving alone to their jobs.

Fees proposed at EV stations

And the city wants to start charging fees at its electric vehicle charging stations. Those might include a fee of 23 cents per kilowatt hour for charging; a fee of up to $2 for connecting; and a fee of up to $5 per hour for leaving the car at the charging station after it has finished charging. The idea is to free up the charging stations for other users.

Even with approval of the budget, the Finance Committee has several items it wants to take a closer look at in August. Those include making sure expenses are not growing faster than revenues and discussing the city’s unfunded liability for employee pensions.