The Pittsburgh Water and Sewer Authority is considering a 5 percent rate increase, board members revealed at their meeting yesterday.

Officials would not release a $150 million draft budget, but confirmed that a rate increase has been under consideration since September.

The draft budget projects that with rates at their current levels, the authority will bring in $9 million less than it will spend, according to authority board member Patrick Dowd, a city councilman. He said the proposed rate hike would only cover half of the deficit, with the rest drawn from a $40 million savings account.

"A rate increase at this time is inappropriate," said Mr. Dowd. The $40 million in savings is "a large amount of cash for this authority to be sitting on at a time when people don't have cash."

City Finance Director Scott Kunka, who also sits on the board, tried to stop the discussion. "There is no proposed rate increase on the table," he said.

But Mr. Dowd said the issue should be publicly aired so that the public and board can consider alternatives before a Dec. 11 budget vote.

Authority Executive Director Michael Kenney said the average household is now paying around $32 a month for water, versus $33 a month in 2003, because while rates have risen, consumption has declined by 25 percent.

The authority took a financial hit over the past year because the global credit crisis wreaked havoc on its variable-rate debt. When a firm that had guaranteed some of the debt withdrew from that role, it drove up interest rates on some of the debt, adding $380,000 to debt payments since early October, plus around $2 million in costs for professional services needed to stabilize some $200 million in debt.

Consideration of the rate increase comes days after Mayor Luke Ravenstahl proposed a 1 percent post-secondary education tuition tax. The administration also is pursuing a proposed long-term lease of the public parking garages that is expected to result in price increases at garages and possibly street meters.

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