PARKERSBURG - A proposal that would gradually increase city sewer rates by nearly 30 percent over the next four years is headed to the full City Council for a vote.
Council's Finance Committee on Tuesday voted 3-2, with council members Nancy Wilcox and Roger Brown opposed, to place the proposal from the Parkersburg Utility Board on the Jan. 28 council agenda.
The base customer charge would go from the current $14.35 a month to $18.63 by July 1, 2017. The volume charge per 1,000 gallons is now $5.56 and would rise to $7.22 in four years.
Photo by Evan Bevins
Parkersburg Utility Board manager Eric Bennett speaks to City Council’s Finance Committee about the proposed sewer rate increase Tuesday in council chambers.
The bill for a customer using 4,000 gallons a month would go up 9 percent in the first year and 6 percent a year after that, for a total increase of 29.8 percent.
At Tuesday's meeting, held in council chambers, PUB manager Eric Bennett and city bond counsel John Stump said the increase is needed to fund federally mandated projects, keep up with inflation and maintain required coverage of financial obligations.
But some council members argued the increase was too high for residents on a fixed income and that the PUB needed to reduce the request by cutting its own spending.
"It's really hard to go out and slap these people in the face with this, and unless we come up with some better numbers, I'll never vote for this," Wilcox said.
During the meeting, which all nine members of council attended, Bennett said the city is under an administrative order from the West Virginia Department of Environmental Protection to eliminate sanitary sewer overflows into rivers during wet weather events by Oct. 31, 2020.
So far, the utility board has spent approximately $80 million on upgrades to the city's wastewater treatment plant, pumping stations and other infrastructure to comply.
The next step is a $12.7 million project at the treatment plant, for which the utility board has secured a 30-year, zero-interest loan with a half-percent administrative fee. But a rate increase must be approved before the project can start.
If the city is not in compliance with the DEP order, which stems from a federal Environmental Protection Agency mandate, the cost would be steep, said Stump, an attorney with Charleston-based Steptoe and Johnson.
"This isn't something the utility board wants; this isn't something the administration wants; I'm sure it's not something council wants," he said. "This is a requirement by DEP, and they will fine you."
And that money would have to come from the city's rate-payers as well, Stump said.
In addition, the utility board is required to maintain rates that will not only cover all operation and maintenance expenses and principal and interest on bonds issued for its projects but also to provide a "cushion" amounting to 20 percent of its maximum annual debt service, Stump said. Failure to do so could result in the city's bond rating being downgraded.
"When you have to go out and borrow money, the interest rate is higher," Stump said.
Wilcox and Councilman John Kelly, who is not a member of the committee, said the utility board needs to tighten its belt and make do with a lower increase. Kelly said the board has routinely given its employees higher raises than city workers under council's purview by tying their salaries to the federal cost-of-living adjustment.
"I'm willing to give you something, but you've got to give something too," Kelly said. "I will challenge you to hold your increase to the same level as the City of Parkersburg."
Bennett said that was not his decision; it would be up to the board.
After the meeting, board member John Lutz said the board could consider it, but noted that, by using the COLA index, there were some years PUB employees received no raises.
"That has been our method of increasing wages for our employees, to keep up with inflation," he said.