The Columbus Utilities Board has approved a contract with the firm Baker Tilly for services related to its ongoing water rate case and its future sewer rate case.
Columbus City Utilities executive director Scott Dompke said that while the board has approved the $308,000 contract, the utilities department’s attorney is still negotiating the final details with the Baker Tilly attorney. Once the contract is settled with the attorneys and receives final approval, the sewer rate study will begin.
“This is a contract for municipal advisory services related to project planning and possible waterworks and sewage works financing,” Dompke said. He added that the contract with Baker Tilly also includes help with “general accounting consulting services.”
The contract is divided almost equally between water and wastewater utilities. For the water rate case, Baker Tilly’s services include consulting with the department is it moves toward “final rate approval through the regulatory agency review process,” he said. In the past, the firm also completed a cost of service study for the city’s water utility.
The city’s request for a water rate increase is under review by the Indiana Utility Regulatory Commission and, if approved, could take effect in August 2021.
Baker Tilly will also complete a sewer rate study for the department, which plans to potentially raise the sewer rate in 2021. Dompke said in a previous interview that the current rate for 4,000 gallons a month usage is $31.10.
The sewer rate study will include examination of the amount of money spent on maintaining lift stations, paying salaries and wages, cleaning sewers, replacing parts at the wastewater treatment plant, responding to customer calls and fixing sewer blockages.
“They look at all of the profiles of the customers, how many gallons we treat, what kind of services we provide, how much does it cost us to provide that service,” he added.
The city’s sewer utility is not regulated by the IURC. As a result, sewer rate increase would not need to go through the commission’s lengthy approval process, he said. Instead, it would need to be approved by the utilities board and Columbus City Council, with the latter requiring two readings before final approval.
The sewer rate study will take several months and that he hopes to have the new rate approved in 2021. He was unable to give an exact estimate for when the proposed rate would be presented and when it might become effective. However, he did say that the utilities department may choose to break the increase into phases, similar to the proposed three-phase increase for the water utility.
If the rate increase is approved, it would be Columbus’s first sewage rate increase in approximately 10 years. The main drivers for the rate case are the depreciation of equipment and the need for “capital improvements,” Dompke said.
Two projects that would receive funding from the rate increase are the estimated $14 million to $15 million Westside interceptor project and $3.5 million in sewer improvements for an area of city utilities customers who were previously served by the Eastern Bartholomew Regional Sewer District.
Both projects will add jobs in the city of Columbus, Dompke said.
