Two of the city's three wholesale water customers lobbied against a proposed rate hike during Tuesday's Blytheville City Council meeting.
The Council read an ordinance for the second time that raises the wholesale water rate from $1.25 per 1,000 gallons to $2.50 per 1,000 gallons. After a third reading, there would be a vote on the measure.
Dell Mayor Kenneth Jackson and Northeast Mississippi County Water Association's Erin Carrington both lobbied against the rate hike, calling for more time and for the Council to consider its impact.
Jackson called the proposal a "catastrophic increase," saying it would hurt Dell water users by doubling their water bill and force the town to consider building its own water treatment facility.
He said the median Dell water customer uses about 6,000 gallons, which is currently $35.77. By doubling the rate, it would be more than $70 for the same usage.
"My customers at 6,000 gallons, when you double the rates, are going to be $71.54," Jackson said. "That is without tax; that is without garbage. That is without sewer. Also, as you know there are state fees. Our people can't afford this."
Councilman Kevin Snow said the city of Blytheville has no control over what wholesalers charge their customers.
"We're not trying to dictate their rates, that's their business," he added.
Snow said there would be no tiers; the cost would be $2.50 per 1,000 gallons.
Currently, for customers inside the Dell city limits, the Dell Water Company charges $18.65 for the first 2,000 gallons, and the cost would be $28.81 for 4,000 gallons. Northeast Mississippi County Water Association's charges are based on meter size. For a 3/4-inch meter, the charge is $10 for the first 2,000 gallons; for a 1-inch it is $40 for the first 2,000 gallons; for a 2-inch it is $75 for the first 2000 gallons; for a 3-inch it is $150 for the first 2,000 gallons and for a 4-inch is it $225 for the first 2,000 gallons.
Both Dell and NMCWA indicated the increase would be passed on to their customers.
"Such as large rate increase is going to have a catastrophic effect," Jackson said.
The Dell mayor noted his city hasn't had time to prepare for such an increase, which would come in the middle of a budget year.
"The other objection is you're not raising your own people's water rates," Jackson said. "If you're trying to create water revenue, then why are you just doing it to your outside customers? It doesn't make any sense to me. It might make some sense if you look that there's an election in November. Still, it's not fair to us when we have to pay $71-plus and y'all $16 and a few cents."
Jackson pointed out Dell officials have begun looking into their own water treatment facility if rates are raised.
"If this comes into being, you're going to lose us," he said.
Carrington also urged city leaders to reconsider because the increase would affect rural and industrial customers.
Snow noted the city is actually selling wholesale water at a loss, noting it cost about $3.69 per 1,000 gallons when producing 4,000 gallons.
"We know it's a drastic raise, but we're still going to be selling it at a loss," Snow said.
Jackson said Dell water users already pay double what Blytheville users do and they can't afford a rate hike.
Dell has around 510 water users and it has been a wholesale customer of Blytheville's since 1977.
Jackson said Dell has always had a good relationship with the city of Blytheville.
He requested a meeting with the Airport and Utilities Committee on the issue.
The proposed rate hike would help fund a water plant expansion, which is expected to cost around $7 million.
Snow said without the expansion, the Arkansas Department of Health could prevent the city from adding water services to new subdivisions or industries in the city.
mbrasfield@blythevillecourier.com