SAN FERNANDO : Projects May Hike Taxes, Water Rates

Rate hikes on water and property taxes may be in the offing if the San Fernando City Council decides to pay for millions of dollars in capital improvements by passing costs on to property owners.

Council members, who heard several options during a study session Wednesday, may also issue bonds to pay for sewer improvements, new water pipelines and pumps through the end of the decade.

The council members revealed little about how they will vote to pay the hefty bills in early May.

“I firmly believe if the public understands it, we should have no problem,” Councilman Doude Wysbeek said.

The council must decide how to fund three projects: the $8.3-million purchase of additional sewer capacity from the Hyperion treatment plant, the city’s share of upgrading the Los Angeles plant and replacement of the city’s aging water distribution system.

Jim Cervantes, a financial adviser with Stone & Youngberg, said the sewer costs could be paid for by selling bonds in two-year increments, starting with $11 million this summer. To pay off the debt, sewer rates could rise as much as 15% a year starting in 1993 and a sewer capacity charge could be added to property tax bills.

The council must also decide whether to use bond financing, water rate increases or both to pay up to $3.4 million in improvements to the city’s water system, built mainly in the 1920s and 1930s.