Water rate increase may be coming:Officials estimate hike around 10 percent
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If city officials follow through with plans to build a new water storage tank, repair the downtown one and update sewage treatment techniques, it’s anticipated a rate increase will be required to pay for the improvements.
Officials have raised rates twice in the past three years – 3 percent in 1999 and 13 percent in 2001. They say the newest rate increase would be needed to cover the costs of equipment they say is necessary to update the water department.
“We just have to upgrade the system. It’s been ignored for so many years,” Water and Sewer Committee Chairman Jimmy Bonner said Tuesday after a Monday meeting where the issue was discussed.
The most immediate need is to paint the downtown water tank, which is expected to cost about $389,000. However, to effectively sandblast, remove lead-based paint and paint the tank, water will have to be taken out of the tank, the city’s engineer Jimmy Hailey told the committee Monday.
Committee members indicated a preference for building a new three-million-gallon concrete water storage tank near the Highway 108 and Highway 127 intersection and accompanying lines first, to compensate for the time when the downtown water tank would be repaired. The downtown tank has been in a state of deterioration and the need for painting it was discussed last year.
The new concrete storage tank is expected to cost $2.1 million and would be designed to increase flow and pressure on the south side of town as well as provide for potential growth, Bonner said, noting a lack of water pressure can affect fire-fighting capabilities.
As far as the downtown tank, officials are also looking at ways to reduce the amount of lead paint disposal costs by about $100,000, Water and Wastewater Director Carl Davis said. If that happens, tank repairs could potentially be paid for with funds from the department’s operating budget, which could reduce the total amount borrowed.
The other big project, a lime stabilization system or “sludge press,” has been talked about for at least three years. According to the latest estimate, it is expected to cost $1.7 million. It would treat sewage liquids and solids and create “Class A sludge.”
The stabilization system would turn solid sewage into a dry powder free of bacteria that could be used as fertilizer for greenhouses or residential lawns, while the water would be treated and recycled through the plant.
Currently, city workers haul an average of 450,000 gallons of water and solid sludge to area hayfields per month using two sludge trucks, which officials considered inefficient.
Davis and committee members said the amount of farms willing to accept that sludge is diminishing and is dependent upon the season. They also said they fear the hauling system, although currently acceptable, will not be considered acceptable by the Environmental Protection Agency in the future.
Funds for the three projects, if it was necessary to borrow for all, would come from two different loans through Tennessee’s state revolving fund loan program, where interest rates were reported on Monday to be less than 2 percent. Before they can borrow, however, the loan requires the city to have new rates in place.
Although some officials indicated an increase of up to 10 percent if the three projects are given the green light, other officials later said that figure was only offered as a starting point. Officials said Tuesday more number crunching is needed before that amount can be determined for sure and said the increase could be less.
Officials have been toying with the idea of increasing rates for several months and have given some indication they could go up because of the closing heavy water consumer Aquatech, which they said traditionally helped keep residential and other costs down. Industrial and commercial water consumption have gone down considerably and revenue has been affected, Davis added.