(3/14) At the March Town Council meeting, the town staff systematically and methodically walked the Council through their analysis of the situation of the Town’s water system. The staff also explained various options for water rate increases designed to address current and future water system needs, while acknowledging the concerns of the Town Council on the impact of any rate increase.

The town staff made it clear that it has been evident for a while now that the town’s water system is in need of repair. To cover the needed repairs, staff recommended an increase of water rates by 36% per year for the next five years, and thereafter an annual increase of 3%. If the council approves the 36% rate increase, the total increase in water rates over five years would be 363%.

Sewer rates were last increased in 2014, following the construction of the new wastewater treatment plant. Because of the 2014 sewer rate increase, the sewer system has been able to keep ahead of maintenance and necessary upgrades, allowing the proposed increase in sewer rates to be a more modest 3% per year.

Water rates, however, have not been increased in 14 years. In that time, the water system has not been consistently covering its day-to-day operational cost, let alone have any money to carry out necessary improvements, or to fix failures in treatment & distribution systems, such as those causing brown water issues.

The water fund has been so depleted that it no longer has a 90-day cash balance to cover operating expenses. While the 90-day cash balance is not a mandatory requirement, it is a critical ranking factor in awarding of grants by the USDA to communities seeking help in funding water system improvements – applications for which have gotten much more competitive over the past three years.

Until the fund reaches its goal of having a 90-day cash balance, long-overdue important proactive maintenance and improvement tasks will not be able to be undertaken.

Considering the urgency of these concerns, town staff’s original suggestion in October was to immediately raise water rates by 150% or spread the rate out over 3 years in order to conduct repairs. However, the Council rejected that request citing concerns then that such a swift raise would hurt residents who are on a fixed income. Commissioner Frank Davis said, "given that times are tough for many, he didn’t want to make things worse for the residents by imposing the full rate increase all at once."

Instead the Council directed the staff to provide them options to spread the rate increase out over multiple years. The staff suggested options were presented by the staff at December’s public hearing. However the options did not sit well with residents who showed up to voice their concerns. So, the Council asked the town to sharpen their pencils one more time and return with the best-case path forward to address the deteriorating water system, while not unduly burdening the pocketbooks of residents.

The staff’s third go at the numbers and the path forward seems to have hit both marks.

While a 363% increase may seem huge, only the water use portion of the quarterly utility bill will be subject to the rate increase. For an average resident with, for example, a current water bill of $35, the 36% rate increase will result in their quarterly bill rising to $47.60 in 2024, $64.74 in 2025, &c, until the 36% increases stop in 2027 when the average quarterly water bill would be $163, or slightly over $1.50 a day.

Following the staff presentation, Council members reiterated their concerns about the financial burden the rate increase would impose, and for over an hour, reviewed and re-reviewed all the staff numbers. The Council even considered having a special one-day workshop where the staff could go over every option with the Council, but after an hour and a half of discussion, the staff was able to alleviate all the Council’s concerns.

"As annoying as the increases are, the repairs needed are necessary," said one Commissioner. "We will have to grin and bear it. We need to have a safe and reliable drinking water system and this rate increase will get us there."

Before making a final decision however, the Council will hold a second public hearing on April 3rd to allow residents to weigh in on the final numbers.