The Clinton Herald, Clinton, Iowa

April 10, 2013

Council backs away from sewer rate increase

By Katie Dahlstrom Herald Staff Writer
The Clinton Herald

---- — CLINTON — Sewer rates won't increase in June, the Clinton City Council decided Tuesday night.

Council members were faced with implementing a 9.5 percent increase by June 1, which would have taken the cost per unit from $8.18 to $8.96. Five council members during the Committee of the Whole meeting voted not to move this increase forward. At-large Councilman John Rowland, At-large Councilwoman Jennifer Graf, At-large Councilman Charlie Mulholland, Ward 4 Councilman Paul Gassman and Ward 2 Councilwoman Julie Allesee voted against the increase.

"I don't think we can sustain another increase like we have just put on taxpayers. I think we need to go back to the drawing board and be creative on how we can find other funding streams be it increasing our local option sales tax, even franchise fees," Graf said."Right now I just can't in good conscience vote for another increase this quick, this steep. Folks just can't afford it."

Interim City Administrator Jessica Kinser explained to council members before they voted that based on a cash flow model that was put together by Jenny Blankenship of Public Financial Management, the city needed to implement a 9.5 percent increase for the next three fiscal years in order to continue to pay for operations, debt and a small amount of capital while also building a cash reserve in the program.

The city has a roughly $2 million in delinquent bills. City officials use a number of tools to combat this delinquency such as using the income offset program and utilizing the lien process. They also restructured a debt for the $62 million treatment plant from a 20- to a 30-year debt schedule, which allowed the city to forgo a sewer rate increase in January and subsequent ones that would have been higher than 9.5 percent. These tools, however, have not been able to make a significant enough impact to completely avoid another increase, Kinser told council members.

She also explained that the vote not to increase sewer rates will not be without consequence.

"We have a significant amount of money to cut and ultimately that's going to play into personnel decisions and we need to figure out how much that cut needs to be," Kinser said.

The other cuts include items in the city's long-term control plan, which the Iowa DNR and EPA have mandated that the city carry out in order to correct combined sewer overflow and other sewer-related issues. The city would need to talk with their attorneys and the DNR to see what projects could be affected. Beyond the long term control plan, not implementing increased sewer rates would result in personnel cuts.

Those cuts would be staff that is funded by the sewer fund, which includes people in the wastewater and sewer and utility billing departments.

Mayor Mark Vulich asked Kinser to identify cost-saving measures residents could make to handle their growing bill if the increase was moved forward.

"When you say the city would have to cut personnel, what will you tell people they will need to cut to pay the sewer increases?" Vulich asked Kinser.

Kinser said while she sympathized with the council's position, a decision had to made regarding the sewer increases.

"I will work with whatever decision you make, but ultimately we're at the time where we need to decide whether or not a rate increase will be done June 1," Kinser said.

Council members made their decision not to add to customer's sewer rates. Ward 3 Councilwoman Bev Hermann and Ward 1 Councilwoman Maggie Klaes were the only members to vote "yes" to move the increases forward.