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home : coal city courant : coal city courant April 29, 2016

5/13/2014 4:38:00 PM
Rising rates
Coal City approves immediate increase in utility fees
The village of Coal City has approved a 5 percent increase in water and sewer rates. The new rates will be reflected on the bi-monthly bill that will be mailed out in early June.
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The village of Coal City has approved a 5 percent increase in water and sewer rates. The new rates will be reflected on the bi-monthly bill that will be mailed out in early June.
Ann Gill
Editor

Municipal users will pay 5 percent more for water and sewer service, the additional funds going to support the replacement of aging equipment and infrastructure.

After months of discussion, the Coal City Village Board approved the increase at its meeting on Monday. The new rates will be reflected on the bi-monthly bill that will be mailed in early June.

Village Administrator Matt Fritz indicated that due to aging equipment associated with the service the budget included, "aggressive programming of rehabilitation projects to improve service delivery."

The village estimates its expenses according to a formula that takes into consider the various cost to operate the service.

The total charge per gallon equals the cost for operation, maintenance, replacement, capital improvement and debt service divided by the total usage expected to take place in one year. Town officials expect to sell over 133 million gallons of water this fiscal year, which will result in more than $78,000 in additional revenue, $66,103 of that coming from the increase in fees.

The rate adjustment, the first in two years, takes into consideration the need to upgrade maintenance facilities, replace sections of water main, fund debt payments and cover the cost of capital improvements.

The village has budgeted $213,475 in debt service that includes a loan payment on the south water tower, as well as completion of water main improvements in the area of Park and Blackstone streets, as well as the zeolite restoration project at the water treatment plant.

Additional water main replacement is outlined in capital improvements and some of the cost will be pushed off to debt service in coming years.

The village will also begin replacing water meters this summer.

"It is anticipated utilizing upgraded modern technology will assist with recording usage much better; this should result in higher usage across the system," Fritz said.

The cost of the project will be pushed back with the first payment coming from the 2016 budget.

According to Fritz, rather than increase water and sewer rates for all of its needs at this time, replacing the meters over the course of the next three years will assist in the development of additional revenue to support the upgrades.

In a memo to the board, the administrator further outlined the need to modernize control equipment for water and sewer treatment. A project that is included in the village's five-year capital plan.

Additionally, he says the village has started to investigate the best means of increasing its water treatment capability for future users of the system.

Village officials budgeted $1.4 million in expenses and are expected to take in roughly $1.38 million in water sales.

Fritz reports that the amount of revenue collected from the rate represents 92 percent of the annual revenues for the utility. The remainder comes from other line items including penalty fees.

In adjusting the rate, users of up to 5,000 gallons per billing cycle will pay $9.66 per 1,000 gallons, an increase of 46 cents.

The majority of residents consume between 5,000 and 20,000 gallons. Those using between 6,000 and 20,000 gallons will now pay $10.76, a 51-cent increase.

Consumers of 21,000 to 40,000 will pay an additional 49 cents per thousand gallons which sets the price at $10.32. Users of more than 40,000 gallons will pay 47 cents more bringing the cost to $9.79 per thousand gallons.

Village officials say that if the village did not have a decelerating rate structure all users would pay a flat rate of $10.43 per thousand gallons.

Rates for water-only users will also increase an average of 31 cents per thousand gallons. A new rate of $6.28 will be assessed on those using up to 5,000 gallons, $7 for 6,000 to 20,000 gallons, $6.72 for 21,000 to 40,000 and $6.37 for amounts over 40,000 gallons.

Water and sewer rates are reviewed annually. The decision to boost the cost was part of the board's budget discussions earlier this year.

In addition to approving an increase in water and sewer rates, the board also agreed to raise the garbage collection fee by $1 per user, per month. The new rate is $38 per billing cycle.

"An increase in the monthly garbage rate will assist the village in generating the revenue necessary to pay this monthly contractual service," Fritz said, adding, the increase will place the village in a positive position versus the cost of providing the service, which is $18.66 per user, per month.





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