Columbus City Utilities’ plan for a phased-in sewer rate increase will have a first reading at next week’s Columbus City Council meeting.
The utilities board voted Monday to adopt new sewer rates. City officials have said in the past that the sewer utility, unlike the water rates, is not regulated by the Indiana Utility Regulatory Commission. As a result, a sewer rate increase would not need to go through the commission’s lengthy approval process.
Instead, it would need to be approved by the utilities board and city council, with the latter requiring two readings before final approval.
The city’s new sewer rate and water rate ordinances will both have their first reading at next week’s city council meeting on June 1, said Executive Director of Administration and Community Development Mary Ferdon.
Doug Baldessari with Baker Tilly, a firm that has been retained by city utilities for services related to both rate cases, said in a previous meeting that if everything goes according to schedule, the new sewer rates would be effective on Aug. 1.
At the same meeting, Interim Utilities Director Keith Reeves said customers will likely see a change in their water bills starting in August, provided the new water rates (which were authorized by the IURC in March) are approved by the city council.
A 4,000 gallon monthly sewer bill for a residential customer is currently $31.10 in Columbus, Baldessari said. His May 20 presentation showed that the cost would increase to the following amounts under the proposed rates:
Phase I: $34.94 (begins on adoption of the rate ordinance)
Phase II: $38.09 (begins Jan. 1, 2023)
Phase III: $40.37 (begins Jan. 1, 2024)
Commercial and industrial customers would see a higher rate of increase under the proposal. The proposed rate increase, as presented by Baldessari, also includes a change in rate structures.
In their vote, the utilities board agreed to approve the sewer rates with a few slight alterations to the resolution before them.
Reeves presented two suggested changes, which dealt with the definition of a “large commercial” customer and adding in an explanation for how extra strength surcharge rates are applied.
Board Attorney Stan Gamso added that they should change the Phase II rate for suspended solid surcharges from $0.144 to $0.14.
Reeves said that extra strength surcharge rates are applied “per pound of pollutant above the specified concentration per month.”
Per Baldessari’s presentation, objectives in the sewer rate case include maintaining financial strength, providing funding for necessary capital improvement projects, paying back the water utility for a loan and providing funds for necessary operating expenses and capital costs.
A large number of rate-funded capital projects are anticipated, Baldessari said. These cover needs such as infrastructure improvements, replacements, upgrades and equipment. Staffing changes have also been built into the rate case.
He said that debt service is also a cost driver in the utility’s need for increased revenue. His presentation showed that the utility’s expected bond-funded projects include the Westside interceptor project, Woodside Industrial Park improvements, and lift station rehabilitations.
Baldessari said that the utility’s capital requirements include an anticipated $34.4 million in projects funded by long-term bonds and $7 million in projects funded by rates and charges for 2021 to 2023. He added that the city will look for available grants.
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The sewer rate increase will require two readings before the Columbus City Council.
The first reading is planned for next week’s June 1 meeting, which begins at 6 p.m. It can be livestreamed at columbus.in.gov/video/live-streaming/. Members of the public can comment during meetings by emailing [email protected].
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