Santa Fe's proposed water-rate increase is "socially and environmentally regressive," said the head of the Santa Fe Watershed Association.

"The poor will be paying proportionately more than the rich for water. That's the socially regressive part," said David Groenfeldt, executive director of the Santa Fe Watershed Association. "An income-tax increase like this would never be approved."

Groenfeldt was one of 11 people, not including city water-department staff and reporters, who showed up for a public information meeting about the rate increase Tuesday evening at the Genoveva Chavez Community Center. The city is proposing a 6.99 percent increase per year for both the monthly service charge and water-usage fee. The increase would occur each of the next seven years if the City Council approves the plan. It includes a 3 percent inflation rate per year.

With the rate hike, an average monthly residential bill of $31.51 would increase to $33.71 in 2009, $38.59 in 2011 and $50.57 per month by 2015.

The city needs the water-rate increase to pay its portion of a $215 million river-diversion project, cover existing water-system upgrades, rehabilitate wells and cover other operating costs. Gross-receipts tax revenues and revenue bonds also cover portions of the cost to deliver water to Santa Fe customers.

Groenfeldt said the rate increase is "environmentally regressive" because it doesn't do more to encourage water conservation.

Gary Martinez, director of the city's Sangre de Cristo Water Utility, said that's what the two-tiered rate structure established in 2004 was designed to do. The city charges $4.09 per thousand gallons up to 7,000 gallons of water a month from September to April. The cost is $14.64 for each additional thousand gallons.

From May to August, the cost is $4.38 for each thousand gallons up to 10,000 gallons, and $14.66 per thousand gallons after.

Resident Rachel Wexler said that's not enough of a "carrot" for people like her who use far less than the average amount of water. "I think it's a huge error on your part. I don't get rewarded for conserving," she said.

Francois-Marie Patorni, president of the Santa Fe Watershed Association, said he thought the rate increase and water rate overall seemed low for an area where water is in such limited supply.

Spreading the rate increase over seven years softens the impact on water-customer pocketbooks, Martinez said. But he said the rate hike is needed to keep cash reserves healthy and to cover the cost of the Buckman Direct Diversion project on the Rio Grande. That project is essential to providing a long-term, sustainable water supply for the city, augmenting water from the city's two reservoirs and to rest over-pumped groundwater wells, city officials say.

Contact Staci Matlock at 470-9843 or smatlock@sfnewmexican.com.