Water revenues not keeping pace with costs in McLouth

The costs of providing water to residents of McLouth is going up and increases will have to be passed on to consumers.

That was the message last week at a McLouth City Council meeting that was preceded by a hearing to discuss the city’s proposed budget.

City Clerk Kim Perry said during the hearing a handful of residents had some concerns about the budget, but most were concentrated on water rates.

Before approving the budget last week, former councilwoman Kim Hochard spoke to the council urging them to keep water rates down.

Hochard was part of a council in 2007 that approved a rate reduction for water customers. Perry said one resident suggested that too much money was going to the police department and that some of those funds should be used on water.

Since 2007, City Administrator Carl Chalfant said the city has been handed two rate increases from Rural Water District No. 13 but customer rates have remained the same.

“We didn’t pass it on because we thought we would be fine,” Chalfant said.

For the past couple of months, however, Chalfant has been telling council members that the issue will need to be addressed, otherwise the city could face cash problems in the future. Chalfant said the city had to supplement the water fund to keep from going into the red this past year. He said the current trend is not sustainable. The last time the city raised water rates was 2004 before lowering them three years later.

Chalfant said the typical house in McLouth uses 3,500 to 4,000 gallons a month. The cost for a house that uses 5,000 gallons is about $52 a month. Comparably water users in Oskaloosa pay about $38.50 a month for 5,000 gallons.

Cathy Tucker-Vogel with the Kansas Department of Health and Environment provided some 2008 statewide numbers concerning water rates.

Two years ago the state average was $27.50 for 5,000 gallon use. However, Rural Water No. 13’s rate was $47.25. Oskaloosa purchased their water at a rate of $24.50 according to the numbers.

Tucker-Vogel said there are several factors that go into formulating water rates including outstanding debt.

Chalfant said the city tries to budget about $25,000 a year for water line projects and said the Cynthia Street project has cost the city $25,000 the last three years in street repairs.

Chalfant also said the city began expanding its water system in 1997 to accommodate growth. He said the growth slowed a few years later leaving costs of upgrades outpacing revenues.

Resident Steve Poe questioned the council about a recent city bid that originally was awarded to the second lowest bidder for the East Cynthia Street project. There was a difference of about $1,400 between the two bids.

“If we’re hurting so bad for funding and water repairs why didn’t we take the low bid in the first place?” Poe asked.

Currently the city is conducting a water rate study.

 by Dennis Sharkey

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Posted by on Aug 24 2010. Filed under McLouth, Municipalities. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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