POULSBO — A new utility rate structure that’s been in place for only three months is hindering the Poulsbo Fire Department’s ability to affect safety improvements in Little Norway, Fire Chief Jim Shields told council members this week.

Although it took the city nearly three years to revamp its rates, at least one fee may be back to the drawing board, leaving a $68,000 question mark in the utilities’ budget.

Shields and Deputy Fire Marshall Jerry Cooper were on hand at the April 9 Public Works Committee meeting to protest a fee for commercial buildings with sprinkler systems that was added to Poulsbo’s utility rates this year.

The city’s utility rate structure had not been updated in about 10 years when work started on a new schedule in January 2000. The new rate structure was approved by the city council in December 2002.

“When we started out, our goals were to make sure we were treating every customer class fairly and also that we were making enough money to run the utility,” Public Works Superintendent Bill Duffy explained.

One of the new fees added to the 2003 rates was a fireline access fee for commercial buildings. Previously, only residential users were charged for fireline use, but now buildings with fireline access (or sprinkler systems) are charged based on meter size, beginning with $14.09 for a 1.5-inch meter and going up to $208.09 for an 8-inch meter. This new fee is expected to bring the utility about $68,000 in revenue this year.

“It could be argued that you’re not really providing service because no water flows through it,” Duffy explained of the sprinkler system charge. “But it is a service. There is a cost to the city and there is debt. We were recommended to charge for that because we do provide a direct connection there — a hard pipe between the sprinklers and the system. It’s like buying liability insurance. You hope you never have to use it, but if you do it’s there and it’s available.”

Fire Department personnel do not see it that way.

Cooper said the actual term “fire flow,” under which the sprinkler systems are being assessed fees, only refers to the water capacity needed to put out a fire in a building without a sprinkler system. With a sprinkler system in place, that fire flow need can be cut by as much as 50 or 75 percent.

Shields added that sprinklers are also seen as a very effective form of early detection and suppression of fire. He gave the example of the Breidablik Elementary library fire, where much of the room was damaged, however, he said the damage could have been much more extensive if the school had not been sprinkled.

“We see the change on a sprinkler system as a disincentive to putting in the sprinklers,” Shields told the committee. “We’re talking to some of these buildings that are smaller and wouldn’t require a sprinkler system and we’re asking them to think about building sprinklers. I hate coming to you after the fact, after something’s been passed, but this is a direct disincentive to what we’re trying to do, which is getting these people to build these systems.”

Others on hand to protest the new charge included North Kitsap School District Director of Facility Operations Randy Odden, who said the district’s fire access charge was now about $975 per month, and local businessman Dan Ryan.

Ryan said he felt the entire new rate structure penalized business people and cautioned the council that additional charges to businesses would in turn be passed on to local consumers. He also noted that he felt the charge might make some businesses not want to locate in Poulsbo.

“I think you ought to charge for what’s a service, not just this is a place we could stick it,” Ryan said.

“Our political intent was to be equitable only,” countered Councilman Dale Rudolph. “We perceived that residential customers were actually subsidizing commercial customers and we wanted to make that fair, not to penalize the commercial.”

The idea to charge a fee for fire line access was recommended by Financial Consulting Solutions Group, Inc., which was hired to study how Poulsbo could make its rate structures more equitable. Duffy said many other cities charge fire flow access fees, including Bremerton, Redmond, Bellevue and Liberty Lake. He added that he was open to going back and looking at whether the charge should be eliminated, but cautioned that the fee represented about $68,000 the utility’s total $1 million in costs.

“If you decide to make a change you’ll have to reallocate it somewhere,” Duffy told the council members.

The committee agreed to look further at the issue in about a month.

“I think we ought to get the consultant involved and I have no qualms about fixing a mistake if it is a mistake and we will make a decision if we need to reallocate that,” Rudolph commented.

Shields and Cooper indicated that they intend to stay involved with the process from here on out, because they see it as a critical safety issue for the city.

“I don’t think it’s a matter of right or wrong. I think it’s a matter of the philosophy of the city,” Shields told the committee members.