Rate hike likely

DUNKIRK — Council members here are considering a 33 percent increase in sewer rates in the near future and studying separate 5-year budgeting plans for both the wastewater treatment and water utility departments.
A significant increase in sewer rates was recommended to the council Monday by accountants from H. J. Umbaugh & Associates, Indianapolis, who had been asked several weeks ago to complete financial reports for both utilities at a cost of $8,000.
City sewer rates, which are figured on the volume of water used, have been $2.09 per 100 cubic feet of water since 2007.
Umbaugh’s proposal calls for a hike in that rate to $2.72 per 100 cubic feet, which was the rate in 2007 when council members approved what was described as a “flip-flop” plan for water and sewer rates.
At that time the sewer rate appeared to be high and was decreased while the water rate was increased to help meet expenses.
That kept the total bill at the same level but increased revenue for the water department and decreased revenue for the wastewater department.
Umbaugh accountants Daniel Hedden and A.J. Amspaugh Monday proposed the rate increase be approved as quickly as possible. They also suggested adopting accounting procedures to more closely monitor utility expenses versus income over the next 5-year period.
They said funds are tight for both utilities, and more increases may possibly be needed over the course of the next five years.
Amspaugh explained that one reason city utility revenues had declined substantially in recent months was the fact that the city’s largest user of water, Verallia (formerly Saint-Gobain Containers), had adopted new water recycling and conservation procedures, reducing revenue by $10,000 a month at the Dunkirk sewage treatement plant.
Hedden said that currently the city has cash reserves, but those reserves will not last unless a rate hike is approved.
City officials said they have been considering about $500,000 in improvements at the plant.
In other words, if city officials don’t do anything over the next five years, “we’ll be broke,” councilman Chuck Rife said.
The process of holding a public hearing and increasing the sewer rate will take about 90 days, city attorney Bill Hinkle said.
“No matter how you explain this, there will be a rate increase,” councilman Craig Faulkner said.
Hedden said that actually the sewer rate will be returning to its 2007 level, but bills to residents will show an increase, and “it will walk like, talk like and smell like a rate increase.”
In other business Monday night, council members:
•Agreed to continue with Barnum-Brown Insurance Agency, Dunkirk, for worker’s compensation and property liability insurance.
•Received a financial report from the Glass Days Festival Committee. Also city officials were given an update on the progress of re-establishing the necessary electrical service to move the festival back downtown for this year’s event on June 1-4.
•Noted that residents may experience rusty water conditions over the next few weeks as a result of hydrant flushing and other procedures. In addition a local manufacturer will be doing some well repair work and cleaning during that period which may also cause city residences and businesses to experience some low water pressure and discoloration, council member Judy Garr said. Screens on faucets and backs of washers may need to be removed and cleaned, she said.
•Tabled discussion until the next council meeting on plans to pave alleys and streets in the city this summer.
•Learned that city health and safety officer Jack Robbins is continuing to work on obtaining ownership of the sites of several dilapidated buildings in the city with the intention of having them demolished as funds allow.[[In-content Ad]]