It may take changes in the Town of Winthrop’s codes related to water and sewer services to help sort out a dispute over increased water charges assessed to owners of the Cascade Condominiums development.
At its meeting last week, the Town Council heard from representatives of the condo association and from Public Works Superintendent Jeff Sarvis regarding utility rate classifications.
The discussion grew out of an appeal of increased rates by Casey and Laura Ruud, who own two units in the development. Casey Ruud told the council at an earlier meeting that he believes the rate increase was not justified. Ruud said the town has “no substantial reasoning” to increase water rates based on the determination that the condos are commercial property as opposed to residential.
In a detailed memo to the council, Sarvis recommended that the council reject the appeal. At the core of the dispute is the town’s decision to increase the Equivalent Residential User (ERU) classification from .78 to 1.0 for nightly rental condos. Sarvis said the lower rate “is inconsistent with Winthrop Municipal Codes.” Sarvis noted that duplexes in town are being charged at the .78 ERU rate, which is also inconsistent with the existing code.
The code includes one section that defines occupancy types and another section that applies to billing and assigning of ERU rates.
“My review of the Town’s water and sewer codes indicate that duplexes and condominiums require that a minimum of one ERU be assigned to billing,” Sarvis said in the memo. “Staff does recommend that the user class and billing for all condominium and duplex units be corrected to assign 1.0 ERU per unit from the currently billed 0.78.” Sarvis noted that the outcome of the appeal would affect future considerations about water and sewer assessments.
Sarvis said condo owners should not be assessed a systems development fee when converting to nightly rentals.
Jay Helfrich, secretary/treasurer of the Cascade Condominiums Property Owners Association, asked the council for more time to review and respond to Sarvis’ memo.
“We strongly believe that the ERU classification for billing for overnight rentals, and the ERU classification for all 32 condominium units are two distinct issues and unrelated issues that need to be addressed separately,” Helfrich said in a memo to the council. He pointed what he called “apparent ambiguities” in the town’s codes as they apply to condominiums — particularly, whether they are considered dwelling units as opposed to a form of ownership.
At the council meeting last week, Helfrich said that condo owners who don’t rent out their properties will be “dramatically impacted” by changes in water and sewer fees.
“Why is the classification changing now? We don’t know and would like the opportunity to find out,” Helfrich said.
Sarvis responded that his recommendations are “all based on the code. It’s not my opinion. I have no special interest in it.”
Council member Bill McAdow said he agreed that condos should not be classified as commercial property. “It’s a residential unit, and I have a problem calling that commercial,” he said. He said short-term rentals are not the same as motels and hotels and should not be in the same classification. “They don’t seem to use more water or sewer than anyone else,” he added.
Council member Ben Nelson said that the town can’t make individual decisions about assessments, and suggested that the town needs to consider changing some definitions in the code.
Mayor Sally Ranzau agreed that code revisions are probably necessary “to keep pace with change.” Sarvis said the code could be “easier to interpret and easier to apply.” It was agreed that the staff will review the existing codes, research what other jurisdictions are doing, and bring recommendations back to the council.
Council returns to 7 p.m. meetings
The Winthrop Town Council will return to a 7 p.m. starting time for its regular meetings at the April 3 meeting. The council meets on the first and third Monday of each month in the Hen House room at the Winthrop Barn.