The
Ellettsville, Indiana,
Public Hearing for Sewer Rate Ordinance
08-12
Dianna Bastin read the ordinance in its entirety. Section 1: Section 52.118 of the Ellettsville
Town Code shall be deleted in its entirety.
Section 2: Appendix A: Schedule of Monthly Rates of Chapter 52 shall
be amended as listed on the ordinance. Dianna
stated there have been several meetings and they have worked long and hard on
these rates. The Council will decide
whether the rates will be raised or not.
Everyone will be heard and all comments will be taken into
consideration.
Privilege of the Floor
Dan Swafford opened the floor for comments; there will be a three
minute time limit.
Richard Sanders, speaking on behalf of the Northern Richland Sewer
Corporation, believes the ordinance could be misleading to people reading
it. There is a “Treatment Rate”
specified but NRSC has a contract and will not pay a new rate without a new
contract. NRSC will have to go through
the process of raising their customers’ rates after a new contract with
Ellettsville Utilities is signed. Mr. Sanders
has an issue with the monthly billing; it should be read every 30 days but his
current bill was extended 32 days. Being
a “minimum water user”, the extended days push him over the minimum limit
increasing his bill. If the ordinance
states “30 days”, the meters should be read every thirty days and not
more. What type of contract does the
Town have with the contractor who is operating the Utilities Department? Is it fixed price or cost plus? Dan Swafford answered “fixed rate”.
Ted Ferguson, Attorney representing
Eastern Richland Sewer Corporation has met several times with the Council,
Utilities Department and ERSC. The
meetings were very productive and they look forward to getting these rates implemented. ERSC appreciates the phase in of the rate
increase for the wholesale customers over the next two years. They will be doing a follow through, with a
rate tracker, to pass this along.
Dan Swafford asked Mike Farmer to explain why the water meter
reading goes over 30 days. Mike
explained they try to start reading at the first of every month. There are billing and reading cycles. This time of year (holidays, weather etc) can
vary the billing cycle. Dan asked what
happens to the minimal user when the readings are over thirty days. Mike said it possibly could if the user goes
over the 3,000 gallon minimum causing an increase to their bill for that
month. Dan asked if it would “adjust
out” at the end of the year. Mike
explained the amount for a minimum water user going over 3,000 gallons has been
less than a dollar. Dan asked how is it
stated in the policy on meter readings; does there need to be a provision for
minimum water users. Mike stated about
one-third of NRSC customers are minimum users.
Dianna stated she is a minimum water user and asked if this would affect
her bill. Mike answered that it could
but might not if she doesn’t go over the minimum. Mike explained an option could be to skip a
reading and just bill an estimate if there is bad weather. They do not like to do this because
undetected leaks, especially during this time of the year, would go unnoticed
for over thirty days and the customer would still be responsible for the
water. The Utilities Department tries to
do what is best for the customers.
Conrad Callahan lives in the Meadow Woods addition and is a minimum
water usage customer. His bill never
hits the 3,000 gallon limit and when he vacations, it is less than that but he
still pays the same rate. He figured out
his usage to what he paid and found that he paid for 18,000 more gallons than
he used. He is suggesting customers
should pay for what they use; what the meter states. He does not know of any other utility that
charges a minimum.
Howard Kimmel feels now is not the time to raise rates with people
out of work and the bad economy. Dianna
said yes they did agonize over that; they started with a higher figure. Mr. Kimmel asked what will happen to the
people who can not pay (the elderly and unemployed). Dianna stated it has been ten years. In order to maintain the plant and do
business, these are the rates they decided on.
Dan stated help to pay bills is out there; Trustees Office. Mr. Kimmel disagrees with the minimal bill
because he never uses the minimum usage.
People paying over the amount should be paying not the ones using less. Mr. Kimmel’s average water and sewer bill is
$50 a month using 1,500 gallons. Dan
explained the Utilities Department will be implementing this over the next two
years to try and “soften the blow”.
Ed Bitner knows the Council has already made up their minds to
raise the rates. Ed has not seen this
year’s Utility budget but the last one he reviewed had “hundreds of thousands”
of dollars in the bank. Ed doesn’t know
if Ellettsville is a 501C3 (but assumes yes) meaning it is a not for
profit. If you are a not for profit and
raise rates to make a profit then you are no longer a not for profit and should
relinquish the 501C3. Sandra stated
municipal governments are naturally tax exempt and we are not a 501C3. Ed does not think raising the rates to make
big profits is right. In years past,
people on previous boards have raised rates, accordingly, have committed
“political suicide” as well as them saying “Ellettsville is all screwed up” and
then leave. Economics 101: If costs rise, you have to raise your costs
and pass them on to someone else. Ed
does not have any ideas on what to do but does know the Council will raise the
rates regardless of what anyone says.
Phasing in the increase is a good idea but be careful what you do, how
you do it and how much. He feels a 17%
increase is a little much.
Dianna
does not know about the “for profit” term.
During all of their meetings, they looked at everything; the cost of
doing business, the cost of equipment.
Not just fuel but everything has gone up in price. This is an unfortunate sign of the
times. The managers, from every
department, looked at and questioned every line. As far as having “hundreds of thousands” of
dollars, Dianna, being their liaison, looked at their budget and did not see
any money they could use and are not using.
Ed Bitner stated it has been a couple of years since he looked at
them. Dianna welcomed Ed to meet with
Utilities Department to review their budget.
Sandra stated the plant uses REMC for electricity. A year ago the bill was almost $5,000 a month
to operate the plant and this month it is just under $8,000.
Jeff Farmer explained there is a Capital Improvement account
where hook on fees are deposited into.
There is an Operations and Maintenance (O&M) account used for the
operation and maintenance of the plant.
The Capital Improvement account is used for replacement of old clay
pipes and other projects like that.
There is some O&M money that has been put aside into CD’s. The O&M account is presently operating at
a deficit close to $100,000 a year for the last few years. This is what prompted this study and rate
increase. Ellettsville Utilities, NRSC
and ERSC all pay into an Equipment Replacement account used only for the equipment
at the plant which currently has a balance of $800,000. That money can not be used by the town to run
their Sewer Department. The Equipment
Replacement account has a large balance because the plant is now over ten years
old and as time goes on, it will start to need big replacements. Other expenses that have gone up since 1997
are sludge disposal from fifty cents a ton to $22 a ton, gas, electricity and
insurance. The Utilities Department has
tried to “hold the line” for ten years.
The average user will pay $3.80 more based on 4,336 gallons. The reality is they knew they were starting
to operate at a deficit and needed someone to look at it. They are not looking to make a big
profit. The newest vehicle on their
fleet is a 1998 and will need to start replacing some of them. The news is showing
The
reason Ellettsville’s rates are high is because in 1995 they were in trouble
and had to build a new waste water plant.
They spent several million dollars and that is what everyone is paying
for. The
It
was asked from the audience “what does the Town of Ellettsville” pay Bynum
Fanyo to manage and how much of a percentage do they receive every year?” Jeff stated the raise is based on the
CPI. The projected amount for the sewer
portion only is $284,000; covering four people, vehicles, insurance, benefits,
phone, pagers.
Dianna
asked if the Utilities Managers will be getting a raise when the rates are
increased. Jeff stated absolutely
not.
A
gentleman from the audience asked about electronic billing and questioned why
he is required to write two checks when paying his water and sewer bills. Dan said they have been looking into it. Dianna stated the rate study for water and
sewer has been on going. There is a “to
do” list of what customers are asking for.
The town decided to take care of the rate increases first and the rest;
one issue at a time. Sandra has looked
at some agreements to provide electronic fund transfers; that all comes at a
cost. There are fees associated with
this and they have not found a company that will handle it at a rate the town
is comfortable with. Jeff stated it is
not something we offer at this time but it is something we will look into
it. Sandra explained the reason for all
the separate check writing is because the Utilities Office is handling the
collection for Ellettsville, NRSC and ERSC.
The Utilities Office process and deposit the payments from the other
sewer corporations.
A
gentleman from the audience asked why they were holding a Public Hearing if
they already made up their minds. Dan
said the Public Hearing was to listen to the peoples’ comments.
Dianna
Bastin explained the Utilities Department noticed they were in trouble, brought
it to the Council and this was started.
The Council, not the Utilities Manager, will decide whether or not to
raise the rates. Dianna never comes to a
hearing without thinking that she might hear something that might change her
mind. The Council has worked hard to get
to this point. She does not like it
anymore than anyone else; she has to pay the bills too.
Adjournment
Dianna
Bastin made a motion we adjourn this hearing. David Drake seconded. Motion carried. Dan Swafford adjourned the meeting at