“It’s been several years since the city has updated the water rates and over the course of those years expenses have gone up,” said Grady Reed, an engineer from firm HDR, Inc. “The city has reached a point where the current water rates are no longer supporting the expenses of the water utility.”
He said the balance in the city’s water fund is “essentially zero,” and the city has been using money from the general fund to cover the shortfall. The city hired HDR, Inc. in the fall of 2017 to find new rates that would allow the water fund to rebuild a reserve, Reed said.
HDR, Inc.’s suggested changes included:
- scaling the city’s water demand charge based on a building’s water meter size, and ...
- altering water usage tiers to better reflect average usage in the city.
At present, Rollingwood has a flat rate of $18.29 for its water demand charge. Reed said scaling the charge based on the available capacity per meter would allow the city to cover costs necessary to meet the demand of the meter.
“The city has to size all of its infrastructure, pumps, pipelines and supply contracts to meet the demand of the [current meters in the city] regardless of if that meter is actually utilized to its full capacity or not,” he said. “The city is paying for the capacity of the larger meters.”
- For the majority of Rollingwood customers—the 427 residents with a 5/8-inch meter—the water demand charge would increase from $18.29 to $19.21 each month if HDR, Inc.’s suggestions are approved.
- The 96 residents with a 1-inch meter will see that charge increase to $48.03 per month.
- The three residents with a 1.5-inch meter would be charged $96.05 per month for the water demand charge.
- The two residents with a 2-inch meter would be charged $153.68 each month.
“We’re charging everyone the same amount [per gallon] for the water they [use],” Mayor Pro Tem Sara Hutson said. “It’s a difference for the capacity we are providing the infrastructure for.”
Alderman Gavin Massingill said he was uncomfortable requiring those with 1-inch meters to pay more than those with 5/8-inch meters each month if both use the same amount of water.
“I understand the academics [of a demand scale], but there’s a difference between the academics and making a decision that is going to cost people real dollars every month,” he said. “I think there’s going to be some sticker shock.”
Hutson introduced an alternative rate and water demand charge scale that included rounded numbers and would slightly lower costs for the city’s lowest water users. She said she believes the structure would give some needed relief to the city’s senior citizens.
Reed said Hutson’s alternative structure would restore the city’s water fund at a similar rate as his suggested structure. The goal is to replenish a water reserve fund by 2020, he said.
Council tabled discussions in order to spend more time evaluating the impact on residents for both proposals.
