Fayette council discusses rates 7.15.09

Written by David Green.

By DAVID GREEN

Fayette village council members discussed water and sewer rates again Thursday night, but offered no resolution to bring the utilities fund out of debt.

Audience member Wayne Williams told council members that the water system should not operate in the red. He acknowledged the tough economic times, but said that’s often used as an excuse to avoid increasing fees.

“It’s a moderate increase that everyone can live with,” Williams said.

For a customer using 7,000 gallons of water a quarter, the proposed nine percent increase would cost $28.48 a year.

Williams said he’s troubled by people saying that water should be free. He worked for the village water department many years ago and is aware of the costs involved.

Acting mayor Craig Rower responded that many people have a misconception about what the proposed nine percent rate increase would cover.

“It’s to pay the bills, point blank,” Rower said.

The funds were to be used only for the operation of the water and sewer system, Rower explained later, and not to generate a surplus for future needs. At nine percent, however, a surplus would have been realized.

“We do agree there should be an increase. We haven’t agreed on what that percentage should be.”

He said he’s working on a plan for a three percent increase which he claims would keep the fund in the black starting in 2010.

Council voted 4-3 at the June 11 meeting against a one-time nine percent increase in rates.

The operating fund went into debt in 2008 and money from the maintenance and replacement fund was needed to cover the shortfall.

The nine percent increase would have put the fund into the black through 2010, but projections show the replacement fund running dry by 2013 without an additional increase.

Williams said that if the water department continues to lose money, eventually it will bleed funds from other departments.

Council member Jerry Gonzales said he doesn’t think it’s reasonable to create a surplus of money in the utility fund with the tough economic conditions.

Council member Paul Shaffer said the rates should be increased enough to pay the bills, with a little extra for emergencies.

What if you pay the bills but then have an expensive problem to fix, Williams wondered.

“Council should have put a surcharge on years ago,” Shaffer said. “To sit here and put all the blame on this council isn’t fair.”

Rates were last increased in April 2005.

For any business, Williams said, preparations should be made for when times aren’t so good.

“I and several council members do not feel like now is the appropriate time to ask for that much of an increase, just so that the village would gain a surplus in those funds,” Rower said later.

When the economy improves, he thinks voters should decide if they want to increase rates more to build a surplus for maintenance and replacement.

Village administrator Amy Metz explained later that a nine percent increase would have covered last year’s debt and added to the replacement fund, if it had been imposed at the start of the year.

A decision to increase rates now would bring in new revenue only for the final quarter of the year and would no longer cover the shortfall from 2008 and 2009.

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