Efforts by Fort Smith city staff to move quickly on a plan to raise sewer rates to pay for federally-mandated system improvements hit a snag when City Director Tracy Pennartz successfully moved during Tuesday's (March 17) Board meeting to table the matter until April 7.
The city is recommending sewer rate hikes to help fund an estimated $480 million in work needed to meet the requirements of a recently approved consent order between the city of Fort Smith and the Department of Justice and the Environmental Protection Agency. The order requires extensive investments in new infrastructure and ongoing maintenance activities to bring the city in compliance with the Clean Water Act.
The estimated $480 million includes $375 million capital costs and $104 million in additional operations and maintenance expenses. While the proposed settlement between the city and the DOJ is complex, the primary purpose of action is to increase capacity to eliminate wet weather overflows and fix defects to eliminate dry weather overflows. The agreement gives the city 12 years to invest the needed funds and do the work to bring the sewer system into compliance.
David Naumann, a project manager with Kansas City, Mo.-based Burns & McDonnell, said the recommendation is a sewer rate hike of almost 169% between now and 2017. The change would move the average user from $19.63 a month for sewer services to $52.70 by 2017. Naumann said analysis shows that the most frequent use per month is 5.67 ccf per month, with 75% of residential accounts using 6 ccf or less, and 50% of accounts using 4 ccf or less. There are about 25,000 residential sewer customers in Fort Smith.
The consultants and city staff did not know how many non-residential users there were. Director Pennartz asked for a “breakdown of classes” among all users.
City Director Kevin Settle asked Naumann if rates would be raised again after 2017. Naumann said the amount of work required is “likely to cause” a need for more rate increases over the life of the consent decree. Settle also questioned the need to hire up to 77 people over the 12 years to implement the order. He said a bulk of the money should be spent on capital costs to fix the system and not to add employees.
Before the Board could vote on the rate increase, Pennartz moved to table a vote until the April 7 regular meeting. Mayor Sandy Sanders was quick to note that the issue is time sensitive. Pennartz said she wanted to more time to gather information, and to consider public input.
For rates to go into effect May 1, which is the recommendation of city staff, the April 7 meeting would require an emergency clause to enact an ordinance within 30 days, said City Administrator Ray Gosack. He said approval of an emergency clause would require votes from five of the seven directors.
A vote on tabling the issue to April 7 was called, with Directors George Catsavis, Keith Lau, Mike Lorenz, Pennartz and Settle voting to table. City Director Don Hutchings opposed tabling the rate increase vote. City Director André Good was not in attendance.
The payment by the city to Burns & McDonnell for the analysis related to staffing needs and rate increases is capped at $177,650, according to Steve Parke, the Fort Smith director of utilities.