The city's financial staff Wednesday urged the Common Council to raise water rates to get the water budget out of the red, but key aldermen were skeptical.
City Treasurer James W. Ashcraft Jr. said the water fund was $585,072 in the red at the end of 1997.
City Clerk and Budget Director Richard P. Mullaney said, "You've heard it from auditors; you've heard it from staff. You need to look at rates. . . . Revenues have not been sufficient to support operations."
But Council President Michael W. Tucker, R-7th Ward, said of Ashcraft and Mullaney, "They're only comfortable when we have a million-dollar fund balance. I don't need to be that comfortable."
He noted that in each of the last three years, Water Department spending has fallen slightly, while revenues have increased, thanks to a program of four annual 8 percent rate increases instituted in 1995.
Tucker noted that the water fund lost $303,743 in 1995; only $38,518 in 1996 ; and the fund actually turned a $27,618 profit in 1997, its first year of black ink since 1991. "I don't like walking around with a half-million-dollar deficit . . . but every year we've made improvements," said Tucker, who is also chairman of the Council's Water and Sewer Committee.
"I can't see raising rates to put money in the bank. That's all a fund balance is, a bank account. I think it's unfair to the taxpayers (to substantially raise rates). If we have a disaster in the Water Department, we're in trouble. If not, I think we can bring it back."
Alderman Jacob S. Michaels, D-4th Ward, who heads the Council's Finance Committee, was more cautious. "I would only look at raising rates as a last resort, (but) we are very close to that last resort, if not there."
A state comptroller's audit for 1995-96 claimed the city was losing 48 percent of the water its filtration plant sends into the system because of leaky pipes.
But Tucker said that figure is outdated and is now about 32 percent.
"We have crews out there every day finding leaks. . . . We're pumping less water," Tucker said. He said the plant is able to get by using only one of its two pumps. The plant's capacity is 12 million gallons a day.
The general fund, which is financed through property taxes, showed a deficit of $258,631 in 1997, but still had a positive accumulated balance of $1,497,202. Ashcraft said that doesn't count $1,030,000 in accelerated state aid received in 1996, which is being held as a tax stabilization fund.
Michaels and Tucker said one of the key factors contributing to the red ink was Fire Department overtime, which Tucker called "exorbitant." At $142,239, it exceeded 1997 budget estimates by 78 percent.
But both men said because of contract talks with the firefighters, which appear headed for binding arbitration, they couldn't comment on what the city intends to do about it.
Meanwhile, the Council heard a 40-minute presentation on a proposed new comprehensive plan for city land use and economic development. A public meeting on the topic is set for 7 p.m. Tuesday in City Hall.
The plan, drawn up by Nutter Associates of Rochester, envisions new commercial areas on Summit Street and State Road in the next decade. It assumes heavy residential development in vacant areas of the eastern part of the city, and mixed commercial and residential use in areas of South Transit Street now largely residential.