BPU Member Stephen McLin reads the motion to approve an 8 percent increase in sewer rates during Wednesday’s regular BPU meeting. The County Council will consider the increase, along with an 8 percent increase to water rates at its July 25 meeting. Photo by Kirsten Laskey/ladailypost.com
As result of two motions passed at the June 21 Board of Public Utilities (BPU) meeting, County Council will decide whether or not to increase water and sewer rates.
The board unanimously passed motions recommending council approve the rate increases during its regular meeting in council chambers.
If approved, each rate would increase 8 percent. Therefore, DPU residential customers would see their monthly sewer cost rate increase from $43.94 to $47.46 for Fiscal Year 2018. This equates to an additional $3.52 a month or $42.24 a year. If the new water rate is approved, the cost for a residential customer who consumes 6,000 gallons of water a month would increase from $36.38 to $39.30 a month. This equates to an additional $2.92 a month or $35.04 a year.
The main driver behind the 8 percent sewer rate increase, Department of Public Utilities (DPU) Deputy Manager Bob Westervelt said, is to raise the department’s cash flow in order to afford the debt service for replacing the wastewater treatment plant in White Rock.
Westervelt said, “We have a very large, very complicated collection system … the rate proposed gets us on the path for the cash flow we need.”
Similarly, the increase in the water rate would help DPU make improvements to its infrastructure. In the past, Westervelt said, DPU made significant improvements. “We have done a lot of work in the water distribution system,” he said. However, DPU no longer has the cash reserves to make improvements and there is a well replacement project slated for this year as well as a big capital project in 2021.
He pointed out that even with the 8 percent increase, water rates remain competitive. “We remain very competitive with our neighboring communities,” Westervelt said. “We do feel it is a very modest rate increase and a fair rate increase.”
While the board approved the rate increases, it also urged the DPU staff to offer up other alternatives to the sewer rate increase that would fund the replacement of the White Rock wastewater treatment plant.
Board Member Stephen McLin said DPU should explain to the board and to the public any financial options available other than building up cash reserves. “I think we owe it to the community to really demonstrate why we are going to approve this rate increase,” he said.
Right now, McLin said, he is not convinced that has been done. Board Chair Jeff Johnson agreed with McLin and asked when DPU staff would have a conversation with the County about potential alternatives. DPU Manager Tim Glasco said they plan to speak with Council sometime in August.
Johnson pointed out that previously DPU had initiated several sewer rate increases; he wondered why those increases hadn’t provided the cash reserves needed. Westervelt said estimates for a new plant have risen plus there is a lot of other infrastructure requirements to the wastewater distribution system and DPU hasn’t been able to raise cash reserves because it has needed to spend money maintaining the system.
Deputy DPU Manager Jack Richardson added DPU had to spend money on some large capital projects such as demolishing the Bayo plant. During public comment regarding the sewer rate, a few questioned having a fixed rate for all customers rather than charging a variable rate that would charge more to those who use more.
Brady Burke pointed out that in calculating the new sewer fees, DPU is assuming the median household income is going get 2.5 percent increase each year. “I don’t know if a 2.5 increase is an accurate assessment of the increase people get every year,” he said.
Burke added that despite whether every household income in town increases 2.5 percent or not, everyone will have to pay more for sewer. “We’re definitely charging people but we’re not sure they are able to afford it,” he said.
Richard Dunn also questioned issuing a fixed rate. “I was surprised we went away from the amount of use determining your sewer rate … I worked pretty hard to keep my use down and yet my sewer fee keeps going up and up and up.”
Westervelt said it was determined the fairest thing to do was offer a fixed rate. He said no residential customer makes a huge impact on the wastewater system. Commercial customers, he said, are charged a variable rates because usage varies depending on the business. “They really do have a variable influence on the cost of the system,” Westervelt said. “It’s more accurate and reflective of cost recovery.”
While the increased sewer rate raised some questions, the water rate increase recommendation was swiftly approved.
Johnson said the County has historically enjoyed a low cost of water for nearly 20 years. He added, the rate increase is reasonable since there are capital expenditures the DPU is facing. “This is a proactive increase. I think it is very appropriate. This is how we should be doing business.”
