BANDON — On Monday, Dec. 9, Coos County Circuit Court Judge Martin Stone granted a summary judgment in favor of Rob Taylor, who sued the city of Bandon for acting outside of its charter by increasing water and sewer rates.
In June 2019, the Bandon City Council passed resolutions 19.08 and 19.09, which increased the rates of water and wastewater utilities without a vote of the people.
According to the City of Bandon's charter, Sections 46-48 prohibit most rate increases without a vote of the people.
Taylor, a Bandon resident, filed a complaint for declaratory relief, asking Coos County courts to declare that the Bandon City Council cannot act outside of its charter, and to void resolutions 19.08 and 19.09.
“The main reason I filed it is because as a citizen, a voter, and a taxpayer, they were violating our right to decide how much authority a government will and will not have," Taylor said. "They chose to violate a charter that was voted on and passed by the citizens, and they completely ignored it."
The city’s main argument for its decision to act outside of its charter is that Sections 46-48 impair obligations the city is required to meet in operation of its utility plants. The city referenced the 2001 court case Stadelman v. Bandon, which involved an existing loan agreement that compelled the city to maintain revenue levels.
In his judgment, Stone said the argument made by the city is not supported because there is no preexisting contract or loan obligation that was impaired by the language in Sections 46-48 of the city’s charter.
According to Bandon Mayor Mary Schamehorn, the decision was made by the Bandon City Council due to the city’s water and sewer funds not being self-supporting.
“This will have a negative impact on our financial situation," Schamehorn said. "Water and sewer are enterprise funds and like any business must pay their own way.
"It was because of the budget shortfalls that we felt compelled to raise the rates. We hope our customers will support our next attempt at returning rate-setting authority to the council. If we can’t get voters to return rate-setting authority, we will have to look at cuts in those departments funded by the general fund. We may have to reduce the number of police officers and staff at the library. The Barn and Sprague Theater are also funded by the city’s general fund and could suffer. This is the hard reality of our water and sewer funds not being self-supporting.”
Once the summary judgment is filed and the courts return with a general judgment, the city will have 30 days to appeal. If the judgment is upheld, the city may have to repay ratepayers for the increase on their utility bills since the new rates were enacted five months ago.
Cities around Oregon have had similar issues with the need to raise rates and fees in order to make up for revenue gaps in the general fund. Since it is a statewide problem, Taylor hopes that his case will set a precedent for similar cases throughout the state.
In North Bend, the group North Bend Citizens for Good Faith Government is working to gather signatures to have a measure placed on an upcoming North Bend ballot to repeal some of the recent Public Safety Fees that have been tacked on to residents' water bills, and to restrict the City Council from raising fees without voter approval.