By MARCUS MCCLAIN
NEA Town Courier
Arkansas Act 605 of 2021 implemented additional requirements of retail water departments in managing and operating water systems.
One of those responsibilities included a rate study, to be conducted every five years. Rates determined from those the study are to be implemented within one year, or two years if it’s found that rates should increase by 50% or more.
The city of Blytheville conducted the rate study last year through Raftelis, a government and utility management company. In September, Raftelis vice president Thomas Beckley advised the council that water revenues were not sufficient to cover operating expenses and debt services. For this reason, he suggested a 65% rate increase over a five year period.
Concerning the sewer rates, Beckley advised a similar increase after reporting to the council that revenues were just enough to cover operating expenses and debt services.
Beckley explained at that time that aspects of the rate study included projecting revenues and expenses for the next five years, along with applying standard inflation increases.
After reviewing two options on implementing the new rates, the council voted to move forward with the more gradual increase option. This would result in a 15 percent rate increase in years 2023 and 2024. Beyond this, a 13% increase would come in 2025 along with 5% increases in 2026 and 2027.
In Monday’s waterworks meeting, the committee sent this year’s increase forward to the finance committee. City CFO John Callens confirmed that no increase would go into effect until the first of the year. It will be read three times in the upcoming council meetings, giving residents the opportunities to speak on the agenda item as well. Callens also provided an estimate of the change residents can expect to see.
“An average user uses about 4,000 gallons of water. So for an average user, the change in your bill for water would be an additional $2.71, plus tax. The change in the sewer bill would be$4.83. So it would be a grand total change of $7.54,” Callens said. “Bigger users will get hit harder. This is what [Raftelis] said we needed to do because we weren't getting them to pay a fair share with the way it was structured in the past.”
Councilman Matt Perrin also added, “The goal of the water department is not to make money, but what it can not do is operate at a loss year after year. That’s why the state made this Act 605 and we have to bring in these consultants every five years.” He later continued, “Nobody wants to raise rates but the water company can’t [constantly] operate at a loss or it will fail and we will fail.”
Councilwoman Shirley Mar-shall questioned Callens on the base rate of water, even if the average 4,000 gallons is not met. To this, Callens responded that under the new increase, the base rate of water on a 3/4 inch meter, would be $13.05. This base rate has been $11.54 for this year.
“So if you’re someone that’s single or elderly, your water may only go up $1.51. Now the sewer would go up $3.74,” Callens said.