Council holds first reading on water and sewer rate increases
By Sean Tubbs
Monday, May 24, 2010
has been briefed on
higher rates being proposed for public water and sewer services
. Finance Director Bernard Wray presented the utility rate report to Council during a public hearing on Monday, May 17, 2010.
“The average residential single family household that uses… 3,860 gallons of water is proposed to increase from $ [a month] to $,” Wray said. That translates to an average increase of %.
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Even though the city projects it will purchase less water from the RWSA next year, finance officials are requesting an increase in the retail rate charged to customers. If adopted by City Council, the composite rate for water will increase from $ per 1,000 cubic feet (MCF) to $ MCF, a % increase, beginning on July 1, 2010.
For sewer service, the city will increase rates from $ per MCF to $ per MCF. That’s a 4.6% increase despite a relatively stable cost for treating wastewater. The increase is mainly due to a RWSA proposal to increase the wholesale rate it charges the city by %.
Wray said the major reason for the increase is due to capital improvement projects to repair and maintain utility infrastructure that the city maintains. From 2009 to 2015, the city anticipates spending $23.5 million on water and $34.5 million on sewer projects.
Those figures are not related to infrastructure projects being planned and implemented by the RWSA for expanding their water and sewer capacity. A portion of the wholesale rate the city pays the RWSA is devoted to the authority’s capital projects. This rate is based on
a nearly $150 million capital improvement program adopted in 2008
which assumes $59.7 million in water projects and $88.3 million on sewer projects.
The RWSA has not updated its CIP due to a series of additional studies into the costs of the community water supply plan. The authority is expected to develop a new CIP this summer after more information is developed on the various components of and alternatives to the adopted plan.
said the biggest driver for utility rates will be the community water supply plan, making it necessary to come up with the most cost-effective approach.
“The other big driver of course is sewer costs,” Norris said. “Our system is in desperate need of an upgrade… That’s not as optional as a brand-new dam that we may not have to build depending on how the data shakes out.”
Wray said his staff will develop a tiered rate structure for water service for next year’s . The primary reason to move to such a system would be to encourage water conservation by charging less for the first few thousands of gallons of water. The
Albemarle County Service Authority
began using a tiered structure last year.
Council’s second reading of the utility rate increase will be on June 7, 2010
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