Final vote on sewer increase set for tonight
ELKINS — Elkins City Council will vote tonight on a proposed 21.5% sewer rate increase on its second and final reading.
The increase would help pay for Phase II of a construction project that is estimated to be $4.3 million, to be funded through a loan from the Clean Water State Revolving Fund. The loan would be for a term of 20 years, at an interest rate of 3%.
City officials have provided information about how the amount of the rate increase was determined, and why the project must be completed.
Operations Manager Bob Pingley said he wanted to “give a few details on the back story of where we are and how we got there” at the Oct. 17 city council meeting, when the proposal was first voted on.
“With Phase 1, we were fortunate enough to be in a position where we didn’t have to raise rates,” and the city was able to absorb the cost of the project into the existing rate structure, Pingley said. “With Phase 2, we are going to have to raise rates. Nobody likes to do that, nobody wants to do that, but it has to be done.”
Three out-of-town members of the project team also spoke at the Oct. 17 meeting.
Bob Hodecker, a state Public Service Commission attorney, said this project will be one of the first in the state to be done under new, recently enacted guidelines under Senate Bill 234, passed in 2015.
“This council will ultimately determine whether this project will go forward or not, instead of … the process of the past,” he said, adding he wanted to be present at the first reading to answer any questions council might have about the process.
Michael Griffith, of Griffith & Associates, the project accountant, explained how the 21.5% rate increase was determined.
He said, under Senate Bill 234’s changes, council will now be required to maintain 12.5% of the operation maintenance expenses of the sewer system in working capitol. He also noted that one of the new aspects of this project is that the city will have to factor in depreciation.
Those two factors played a part in deciding to set the rate increase at 21.5%, Griffith said.
“The average sewer rate for 3,400 gallons in West Virginia is in the forties or fifties. With this one, you don’t get to that level, even with the increase,” Griffith said.
He also pointed out that the city had a “cash loss” of $62,000 on sewer services in 2018.
“This increase is basically to pay for your current bills and to pay for the new debts you will incur” with Phase 2, Griffith said.
Michael Davis of Burgess & Niple, the project engineer, said city officials were determined to be as cost-conscious as possible in developing Phase 2.
“I don’t think I’ve ever had another project where you told me what the price would be, and we worked backwards,” he said.
City Attorney Gerri Roberts pointed out that the project was required by a consent degree, and the city has no choice in the matter.
“This is something that the city agreed to do,” she said. “It is not a choice.”
The purpose of the Sewer/Stormwater Project, as the city refers to the effort, is the segregation of the sanitary sewer from the storm sewer to meet a U.S. Environmental Protection Agency consent decree in relation to Elkins’ inability to adhere to Clean Water Act regulations.
Separating the two systems will enhance the sewer facility’s capacity. During heavy rains in the past, the sewer has overflowed and spilled over into the Tygart River.
The consent decree was ordered in 2012 in U.S. District Court for the Northern District of West Virginia, with the state and the U.S. government as the plaintiffs and the city of Elkins as the defendant. The consent decree was the result of a negotiation between the parties involved.
Phase 1 of the project, which began in 2015, focused on Barron Avenue, Kerens Avenue, College Street and Wilson Street.
Phase 2 will affect Lavalette Avenue and Elm Street.
The second and final vote was scheduled for the Nov. 7 City Council meeting, but city officials pushed the second vote on the proposed increase back for two weeks, until tonight.
A public hearing was held Nov. 7, however, and was continued until 7 p.m. tonight.
City Council will meet immediately after the public hearing tonight in City Hall.