September 3, 2014

Standish discusses water and sewer rate study

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STANDISH — The Standish City Council held a special meeting March 3 to discuss a water and sewer rate study that could affect rates by July 1, the beginning of the new fiscal year.

“It was put together so we can put something into effect by July 1,” Standish Mayor Mark Winslow said.

Brian Minor from the Michigan Rural Water Association put together the study to show the city what options it had for the water and sewer rates.

“Rates are based on the budget; budgets should not be based on rates,” Minor said.

Minor also said that water and sewer systems should pay for themselves.

“It should stand alone as a separate entity,” he said.

The current cost per 1,000 gallons of water is $9.10, and the sewer rate is $4.95 per 1,000 gallons.

One scenario that Minor presented was putting 100 percent of loans, bonds and interest into the base rate. This option would make the usage rate $5.41 per 1,000 gallons, and the same scenario for sewer rates would make it $5.26 per 1,000 gallons. However, decreasing the usage rate leads to an increase in the base rate. For instance, the usage rate for water in the previous scenario would lead to a $45.58 base rate. Another scenario could have a base rate of $14.00, which would lead to a usage rate of $7.04 per 1,000 gallons. The current base rate for water is $12.50 a three-fourths inch meter, which is the smallest meter size.

Minor also said that Standish shouldn’t compare its rates to other communities but should compare policies. Other communities have different styles of treatment and different management, he said.

Council member Ed Reno said that he would also like to consider adding a line item to the water and sewer budgets that would serve as an emergency fund.

“I want a cushion there to cover ourselves,” Reno said.

The council will continue to review the water and sewer study so any changes can be implemented in time for the new budget.

“We want to do it if we can, but we have to do it in a safe manner,” Reno said about the possibility of lowering rates.

The council meets to discuss the budget March 18, at 4 p.m., and again March 25, at 6 p.m., if necessary.

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