Wayland kicks off utility rate review

By: 
Virginia Ransbottom, Staff Writer

It’s been at least 12 years since the City of Wayland increased water and sewer rates.

That’s about to change.

Rate adjustments are the next step in the city’s Stormwater, Asset Management and Wastewater (SAW) grant program in which the city received $380,000 to identify infrastructure needs and plan for problem areas before they become emergencies.

“Nothing has been accomplished until a new rate schedule has been implemented,” city manager Joshua Eggleston said in a Power Point presentation to council members on Tuesday, Jan. 22.

“Planned maintenance cost one third less than unplanned maintenance for the same task,” Eggleston said.

“Deferring failure is not cost effective—everything wears out eventually.”

While rates must be affordable to residents, everyone has a different idea of what is affordable; therefore, the USDA developed an affordability standard test, which shows Wayland has a significant capacity for a rate increase.

According to the test, those with a median household income of $52,831 should be paying 1.5 percent of their income per utility; or $66.04 per utility for a total of $132.08 for an assumed 4,500 gallons per month usage.

Wayland is currently paying $16.66 per month for water and $28.49 per month for sewer for 4,500 gallons of usage.

Eggleston said a committee should be organized and public hearings held to develop a fair and equitable rate that will produce the revenues necessary to successfully operate the utilities, promote lifestyle and economic development goals, is easy to administer and annually adjustable. That will involve data collection of water use history, operating and maintenance history, production history, reviewing infrastructure, the budget and inflation, a rate structure and several other factors to justify the increase.

Right now the surcharge or base rate only generates 35 percent of fixed operating expenses. It needs to be closer to 50 percent, said Eggleston, also recommending a budget to save at least 10 to 15 percent of capital replacement costs.

Virginia Ransbottom can be contacted at vransbottom@allegannews.com or at (269) 673-5534.

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