After piling up extra cash since a 30 percent sewer-rate hike kicked in last year, city officials are considering holding off on more increases in the near future.

The reprieve discussed by the Public Utilities Committee on Wednesday wouldn't be dazzling in terms of its financial effect on an average household. But backers say it's the right course of action given large cash balances in a wastewater reserve fund.

City councilors previously approved plans for sewer rates to rise by 4.7 percent in the autumns of 2012, 2013 and 2014. They now want to roll that back in light of the recent discovery that rate decisions were based on erroneous information.

"It's returning money to the ratepayers by virtue of not doing increases that we don't need," said Councilor Rebecca Wurzburger, who chairs the committee and is sponsoring an ordinance amendment to repeal the additional increases. "A mistake was made, and rather than saying this is money that we can move over to the general fund, I think it was important to evaluate."

Councilors Matthew Ortiz and Ronald Trujillo also said they support the proposal.

Although the full governing body must vote on the idea before it would become effective, several councilors who aren't on the committee also have said they don't want planned increases to happen.

City officials first started talking in public about surplus revenues in the Wastewater Division early this year when they began looking at tapping the cash reserves as a way to balance the city budget. Information provided to the Public Utilities Committee this week indicates administrators in charge of utilities have been aware of the surplus since late December.

The 30 percent rate hike that took effect at the start of 2010 was based on reports that estimated annual revenue using seven months of actual collections instead of 12, reported Jason Mumm of StepWise Utility Consultants. Also unreported in 2009 evaluations was about $12 million in cash balances, he wrote.

Reached via email, former Wastewater Division director Qustandi Kassisieh said the blame for the problem shouldn't rest with him. "The consultant ... used budget reports supplied by the Finance Department," he wrote. "Not one person in Wastewater had access to these reports."

Kassisieh, who retired in 2009, has been replaced by Brian Romero, acting division director. Romero said rate increases were already on the books and slated to go into effect when he took the reins at the division.

Brian Snyder, who as head of the Utilities Department oversees wastewater, trash and water operations at the city, has said he's fine with the plan to transfer some reserves from the Wastewater Division into the general fund or to use some gross-receipts tax revenue that now goes to sewer funds, as long as there's enough cash left to cover emergencies.

Mumm told councilors they could consider three basic scenarios for altering sewer rates in the future while maintaining enough reserves to allow for needed capital projects and other uses. Councilor Wurzburger chose a rate-reduction strategy that would keep in place rates established after the 30 percent increase but eliminate planned future increases.

In the alternative, the rate consultant said, officials could impose a large immediate reduction, lowering sewer rates by 16 percent July 1, then resuming increases of about 3 percent each year going forward. Another idea from Mumm is to take a small immediate reduction by lowering rates 6.5 percent July 1, then eliminating all future increases until around 2015.

Monthly base sewer rates are $5.85, with additional charges of $3.58 per 1,000 gallons of water used. Planned increases on the books would change base rates to $6.72 per month plus $4.11 per 1,000 gallons in October 2014.

Contact Julie Ann Grimm at 986-3017 or jgrimm@sfnewmexican.com.