Senior discounts on utilities come under scrutiny

A staple of some public utility departments for years, senior discounts for things like garbage pickup and sewer fees increasingly are coming under scrutiny as cities become aware such deals run afoul of state law.

Marion this year stopped giving seniors a break on garbage bills and Cedar Rapids is looking into its senior discount program.

In southeast Iowa, Keokuk stopped giving about 600 seniors a discount on garbage fees, according to media reports. In central Iowa, Bondurant lamented on its website it was 'forced to go down a path we would rather not travel” and end a water and sewer break for seniors.

The concerns started last August when an Iowa State Auditor's report for Cascade, south of Dubuque, determined the city was illegally offering senior discounts on water, sewer, garbage and recycling fees.

A discount based solely on age is a discriminatory rate prohibited for public utilities, a section of Iowa Code states.

State Auditor Mary Mosiman said she realizes some cities have offered such senior discounts for decades.

'We recognize there are cities out there who are still offering discounts, but we only report on one city at a time,” she said. 'We typically recommend when it comes with compliance with the Code of Iowa that entities change their practices, or work to change the law.”

Cedar Rapids has provided discounts for residents over age 62 since the mid-1990s, said Steve Hershner, the city's utilities director.

The city's utility and service rates are in two components - a daily service fee that covers some of the costs of providing the services and a utility fee based on use.

Residents over 62 are eligible for water, sewer, recycling, yard waste and solid waste rates at half the regular cost of daily fees, Herschner said. But seniors pay full usage fees for utilities such as water and sewer.

Hershner said 455 residents benefitted from the discount last year, saving $275.82 annually.

But the city plans to review the discounted fees, he said.

'We feel it is a service that is provided to customers in need with a great resource,” he said.

Marion offered a senior discount for residents 65 and older on garbage fees for at least 20 years, said Ryan Miller, the city's public services director.

In fall 2016, the monthly solid waste collection fees were $14 generally and $10.50 for seniors.

Miller said the public services department was discussing increasing the rate for seniors so it would cover the actual cost of collection. About the same time, the city learned of Mosiman's audit of Cascade.

Marion had no choice, Miller said.

'After the audit finding, we brought that to the attention of the City Council and made formal action to address the ordinance,” he said.

In January, the waste collection fee for seniors rose to $14.25 a month, an increase of $45 a year.

Marion couple Tom and Kay Lammers, both over 75, said the discount was helpful for those on a fixed income.

'It's getting out of control for seniors,” Kay Lammers said. 'Taxes are killing us. The grocery costs are going up. We have savings, but we didn't want to spend it on garbage fees. If we generated a lot (of garbage) it would be different. It's not just the trash fee, it's everything piled on top of it that's getting to us.”

Miller, Hershner and Mosiman said they would support a change in the law, but that's up to legislators.

'We have absolutely nothing against seniors or senior discounts as long as they're income-based,” Mosiman said.

Rep. Zach Nunn, R-Bondurant, said he intends to change the law.

He said he hopes to get an amendment approved still this legislative session, which is nearing its end, or next if need be.

'It's worth it for someone who is a pensioner and they see their utility bill go up double digits annually,” Nunn said.

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