Rates for sewer work announced

Home owners who are part of three sewer projects near Portland and Dunkirk will be paying about $76 per month for construction and monthly service.
Jeff Rowe of H.J. Umbaugh and Associates presented the Jay County Regional Sewer District board with results from his rate study for the new sewer lines that will be installed near county road 125 South and Ind. 67 southwest of Portland, and the Skeens Addition and the Willow Drive area in Dunkirk.
Rowe presented a monthly rate of $76.75 per Equivalent Dwelling Unit (EDU). Residences on the line are equal to one EDU while businesses being hooked up — most notably Miller’s Merry Manor in Dunkirk — will pay additional EDUs per month due to higher volume use.
According to a house count and commercial estimates, Rowe informed the board that the Foxfire project contains 36 EDUs, the Skeens project has 36.8 EDUs and the Willow Drive area includes 22 EDUs.
The total project cost for installation of the three sewer line (Foxfire: $365,276, Willow Drive: $124,535, Skeens: $258,661) with a 5 percent construction contingency will be $785,896.
Non-construction costs for the project — including engineering, legal counsel, inspections and connection fees — were estimated at $322,104. Rowe said that the connection fee portion of the estimate was purposely set high since negotiations with the cities of Portland and Dunkirk on sewage treatment agreements are still in negotiation.
“I understand these are still under negotiation,” Rowe said. The estimate he included was for three tap fees in Dunkirk and a tap fee for every location in the Foxfire area.
Board president Gerald Kirby has noted that the tap fee issue has been a point of contention in negotiations with Portland.
Kirby said the city wants a tap fee for every structure receiving sewer service while he has argued that the new district line will only connect to the city’s current sewer line at one point, warranting one tap fee. Negotiations are ongoing.
“It’s a worst-case scenario,” Kirby said of the connection fee figure. “It’s a cushion.”
“There is some fluff in here,” agreed Ben Adams of Commonwealth Engineers.
With a total project cost of $1,108,000, the sewer district will receive 45 percent of the cost ($498,600) in grant funds from the United States Department of Agriculture Rural Development office with the remaining $609,400 to be obtained in the form of a low-interest 40-year loan.
The loan will require average annual bond payments of about $26,600 over the 40 years.
Rowe then went into analysis of expected annual operating costs including maintenance work, treatment charges, billing costs and administrative charges.
“We’re estimating about $48,200 in total operating expense,” Rowe said.
Rowe did note that this estimate did not include possible treatment rate increases. The City of Portland is currently exploring a rate increase for sewage treatment and board member and Dunkirk wastewater superintendent Tim Kesler said Dunkirk may also begin looking at a rate increase in the near future.
Put together, the monthly bill for users consists of a $5.29 billing charge, $44.23 for operation and maintenance and $27.21 for debt service for the rounded EDU charge of $76.75.
Rowe reported that the district can expect to receive about 1,080.6 EDUs per year. That number includes a 5 percent reduction to account for unforeseen variances and delinquencies.
“We have adjusted the actual numbers down by 5 percent,” Rowe said.
Although residences will pay only one EDU at $76.75 per month, Miller’s Merry Manor north of Dunkirk will be facing a monthly bill of more than $1,000 per month since its estimated usage at full capacity puts the business at 14.8 EDUs. Miller’s is currently paying $300 per month in treatment fees.
The monthly rate is still an estimate until final treatment contracts are reached with Portland and Dunkirk, however the rate is expected to change drastically once those are finalized.
“All of these numbers are based off estimates,” Rowe said.
The $76.75 monthly rate is close to original estimates of about $70 provided to the sewer district in June 2009. That estimate did not include the $5 billing fee, making the true cost within about $2.
“Sixty-five dollars to $75 was generally what we were hoping for,” Kirby said.
Rowe presented a draft rate ordinance to the district board and reviewed the document with board members. During the review, Rowe asked the board if it would like to establish a connection fee for any future hookups to the district line. Board members agreed that for future connections a one-time fee of $750 should be charged.
The board introduced the rate ordinance and agreed to hold a public hearing for feedback from the community. That hearing was set for 5:30 p.m. on Dec. 6 in the Jay County Courthouse auditorium. Following the hearing, the board is expected to adopt the rate ordinance.
In other business, the board also adopted the bond ordinance, which was introduced at the last meeting. The ordinance set parameters for the district bonding and bond issue for loan portion of the project cost.[[In-content Ad]]