Lebanon
If approved, the average Lebanon household will pay nearly $83 in additional fees for water and sewer service each year, according to city estimates. The new rate would take effect on Jan. 1.
“It’s basically the cost of capital improvements,” said Len Jarvi, Lebanon’s finance director, on Monday.
Several city projects contributed to the increase, he said, including the Mechanic Street reconstruction.
The city previously budgeted $2.5 million for that project in 2017, planning for the state to pick up 80 percent of overall costs. But then the state pushed back its construction timeline, resulting in the city picking up the whole tab for next year, an estimated $6.3 million.
The city is in the midst of a multiyear sewer system upgrade that is designed to separate storm runoff from sewage in order to reduce pollution.
“As everyone knows, the city is under a U.S. Environmental Protection Agency-issued administrative order to complete the (combined sewer overflow) project by no later than 2020,” Jarvi wrote in a memo to the City Council.
Lebanon also has $2.9 million in planned improvements on its water treatment facility, $1.2 million dedicated to construction on Mill Road and another $1.7 million dedicated to the Route 120 sewer improvement project.
Looking ahead, Jarvi said, infrastructure projects will lead to significant debt payments beginning in 2018. The increased rates, he said, will save residents from more painful increases when those bills become due.
“It’s not fashionable to look two or three years out, but I can’t help it,” Jarvi said. “You need to start planning resource accumulation now or you’re looking at huge increases later.”
Overall, he estimates the new rates will generate an additional $400,000 for city coffers in 2017, and a total of $3 million by 2020.
Utility rate increases are nothing new in Lebanon. Last year, the City Council adopted new rates, increasing the average household bill by $60.
Some local businesses also noticed the increase. Hypertherm saw its water bill increase 14 percent between 2015 and 2016, said Perry Seale, director of facilities at Hypertherm.
“It’s a pretty healthy chunk of change that we’re spending on water,” he said.
To mitigate that, the company invested in a recirculation system that recycles about 50,000 gallons of water a day at its Heater Road facility.
Since 2013, the company reduced its water bill by 11 percent using that system, Seale said. But installing the system came at a cost, he said, and if the rate increases continue, there will come a day where those savings will be offset.
“We’ll hit the wall and we can’t go any further,” Seale said. “Rate increases are a double-edged sword in that as prices increase, there’s a natural motivation to look at conservation (of water).”
Seale, who also lives in Lebanon, said he would like to see the city create a five-year plan that looks at what people are spending on water and clarifies what’s going into the rates.
Among City Council members, there’s also been calls for more clarity and a possible restructure of how Lebanon bills residents. Last year, the council held two meetings on possibly moving away from the current billing system, which charges residents a quarterly fee for using the system as well as a service fee for the amount of water they use.
Jarvi said an upcoming study will explore billing structure along with future rates. It’s expected to be completed in mid-2017, he said.
Assistant Mayor Suzanne Prentiss is among those who called for a new rate structure. She won’t be at Wednesday’s meeting, but said she’s awaiting some change to alleviate the burden on taxpayers.
“I think it’s unfair to continue to task the taxpayer to absorb this,” she said.
Councilor Clifton Below said on Monday he understands worries about the water and sewer rates, but the council has worked to keep increases in the single digits.
“Part of the recent policy of having relatively smaller increases every year, in addition of that service cost, is to avoid large increases when the debt obligation comes due,” he said, adding the policy was adopted after residents experienced a period of large rate increases spread every few years.
Looking to the future, Jarvi said he expects increases to continue, although he isn’t sure how much residents will be expected to pay in the coming years.
“I’m not Nostradamus, but I can reasonably predict there is going to be a rate increase (in 2018) for water and sewer,” Jarvi said.
The City Council will hold a public hearing on the water and sewer rates at 7 p.m. on Wednesday in City Hall. There will also be a hearing on the proposed no-camping ordinance meant to discourage people from camping overnight on city-owned property.
Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.