Trying to keep from losing more ground to rising costs, the Town Council on Thursday night increased base water rates by 2.8 percent — about $1.37 monthly on the average water bill.
Mayor Donna Duvall, opening discussion of a rate review, said no one ever wants to raise rates, “but it becomes necessary” at a certain point as costs increase.
The council last raised the base rate, in 2015, by 1.7 per cent. The outcry in the wake of that relatively low levy prompted officials to skip a rate review last year.
Council member Jeff Solinsky said he was “nervous about kicking the can down the road” again this year. “We did kick last year and I worry we are going to get where we were in 2015,” he said in advocating a rate change.
“Our operating costs were up 13 per cent last year and revenue was down,” he noted. That, he said, can lead to nothing but more difficulties.
The town’s amended budget for the year, ending June 30, 2017, shows water sales of $303,200. Total water department revenue, including a $192,500 grant, was $542,900. Total department expenses, including debt service and transfers, were $524,000.
Before seconding Solinsky’s 2.8 per cent motion, Ray Blanchard said he wanted to know, from the town’s auditor, what a proper increase would be. “I think we need our CPA to recommend a figure,” rather than council members coming up with one, Blanchard said.
“If it was up to me,” said CPA Randy Brown, who was in the audience, “I would stick to a close match with the Consumer Price Index (CPI). That is minimally invasive — pennies on the dollar.”
Brown pointed out the CPI provides a stable, constant reference to changes in the cost of goods and services.
Solinsky rejected amending his motion to 2.0 per cent. He said he could not, in good conscience, do so.
The increase passed 4-1, with Leonard Johnson voting no.
Council members also adopted the amended budget for the just-completed fiscal year.
Total General Fund administrative/police/streets income was $631,000. That includes $281,200 from fines & forfeitures/court fees and $100,000 in sales tax transfer.Total expenses were $628,500, including $262,800 administrative expenses, $297,400 police department and $68,300 streets.
The General Fund had a $2,500 excess of revenue over expenditures. That figure is akin to an individual with $50,000 annual income having $150 on his/her checking account at year’s end.
The $2,500, when added to prior years carryover, increased the General Fund fund balance to $20,764.
The Wastewater Department had income of $468,400, including sales tax transfers, and expenses of $414,300.