Anaheim Residents to Get Water-Rate Break : Utilities: Council votes to cut fees 10% for individuals while increasing them for businesses to equalize costs.

The City Council on Tuesday approved a plan that will lower residents’ water bills an average of 10% over the next five years but raise them for businesses and industry.

The rate restructuring, which will take effect Sept. 1, is designed to equalize costs. Under the current structure, residents are subsidizing water rates for businesses and industries.

The Anaheim Chamber of Commerce did not oppose the restructuring plan, although it will mean an average increase of 10% in water costs for businesses over the next five years. Water is a relatively minor expense for most companies, said Jay Walton, the chamber’s governmental affairs manager, and companies that do use large amounts of water typically have recycling programs.

Also Tuesday, the council unanimously rejected a proposal for a citywide, 1.5% water rate hike.

“I think the council felt that this was a hidden tax,” Councilman Bob Zemel said.

The hike was proposed because of a fee Anaheim is charging its own Public Utility Department to help the city cover a nearly $9-million budget deficit for the 1994-95 fiscal year.

Zemel said that when the city charges its utility department a fee, the utility should not pass that fee onto customers by increasing rates. The 1.5% hike would have generated an additional $500,000 annually for the city.

Mayor Tom Daly said his colleagues “viewed the systemwide rate increase as unnecessary, especially in light of the increases that already have been absorbed by the ratepayers in recent years.”