Alva Review-Courier -

'Way too much, way too quick'

• Public comments on utility rate increase

 

August 13, 2017

Marione Martin

The Alva City Council holds a public hearing on utility rate increases Wednesday, Aug. 9. From left are Bo Hannaford, Mary Hamilton, Mayor Kelly Parker, Business Manager Joe Don Dunham, Brandon Sherman, Chris Eckhardt, Bryce Benson and Danny Winters. Not seen to the left are Brian Wallis and Randy Stelling.

"This is way too much, way too quick," said James Stallings during Wednesday's public hearing on proposed Alva utility rate increases. His comment reflects the attitude expressed by those speaking to the Alva City Council. A video of the entire hour-long meeting may be viewed at AlvaReviewCourier.com.

The hearing gave utility users a chance to ask questions and express their views before the city council puts the rates to a vote on Aug. 21. Although this was the final chance to speak to the council as a whole, Mayor Kelly Parker encouraged anyone with questions or concerns to speak with council members individually.

About 15 people attended the public hearing. All eight members of the city council were present in addition to Parker and City Business Manager Joe Don Dunham.

Mayor's Opening Remarks

Mayor Parker explained the city council has been working on the utility rate proposal for about eight months. In April a public hearing focused on some preliminary ideas for rate increases.

After that hearing, the city asked for opinions from the Oklahoma Water Resources Board (OWRB) and Communities Unlimited, a nonprofit organization providing services to towns with population of less than 10,000. The latter group only recently submitted their findings.

Alva is seeking a $2.1 million loan at a low interest rate from OWRB to replace two water storage tanks on Young Street with one larger tank with more capacity. The loan would also pay for a booster pump and other updates to improve water pressure. The old storage tank system has developed leaks and other issues too expensive to repair.

Long-range plans call for a second phase at additional cost to address issues in the area of the west part of Alva. The mayor also said the city has miles of lines from the wellfield as well as inside the city that need replaced.

"The water rate proposal is intended to get our community to be able to fund its water and sewer infrastructure without relying on a sales tax that just isn't present," said Parker.

Before the OWRB is willing to loan the money, they have certain requirements. One is a progressive water rate to encourage conservation. The more water used, the more charged per thousand gallons. This was implemented when Alva finished replacing all the water meters in town last year.

Another requirement is for the city to show a sufficient amount of income to pay back the loan. Current utility revenues annually fall $800,000 short of the amount OWRB wants on the books. The OWRB also has environmental quality requirements that Alva is in the process of meeting.

Parker went over the new rate proposal, explaining that the base rate was about 78 cents more than proposed in April. The new rates have no minimum number of gallons included. Currently the minimum is for 5,000 gallons. The April proposal had a the minimum of 1,000. The latest rates do not include a minimum water usage with everyone starting at zero. "All of the tiered levels are less than what was originally proposed in April," the mayor said.

At current water usage levels, the rate increases should provide the extra $800,000 required for OWRB funding. By the fourth year, utility revenues will be up by a little over one million dollars to reach the optimal level recommended by the Communities Unlimited study. The optimal level includes "funding to support ongoing infrastructure and upgrades" according to Parker.

He said the council is committed to fixing deteriorating infrastructure and making sure "we haven't kicked the can on down the road" for future generations.

Councilmember Remarks

Councilmember Brandon Sherman addressed some questions posed on social media. One was a large jump in the fourth year base rate for outside water service. He said that was a math error that has since been corrected. The rate proposal is posted on the city's website at alvaok.org.

Sherman elaborated on the OWRB requirement for an additional $800,000. He said Alva had to make up the revenue shortfall "in order to get that loan at as low an interest rate as possible. That is the requirement. Not only that, we have to report monthly that we are making up that shortfall."

Tom Crenshaw

Tom Crenshaw, who pays utilities for his commercial greenhouse as well as a residence, was the first citizen to speak. He questioned the fairness of the tiered rates which he said punish those "that have to have water." He also expressed concern about the sewer rate. "In my business, I might use 90,000 gallons of water but probably not 500 goes down the sewer," he said. "It's punishing people for watering their yards, having a garden."

He was also troubled by the rates for governmental and school entities which he believes are getting an undeserved break. "Most of these businesses are already paying taxes that are supporting these places," he said.

Jim Scribner

Alva resident Jim Scribner asked what his bill would be. He said he used about 2,600 gallons of water last month and paid about $54. Parker said it would increase to about $67 in the first year. After some figuring, Dunham said the fourth year bill would be about $80 for 3,000 gallons water usage.

Displaying his usual sense of humor, Scribner said, "I want to know what the guarantee is that this money is going to be spent on infrastructure of water, sewer, etc. and not trips to Vegas for everyone."

Sherman quickly replied, "I don't get paid enough to take a trip to Vegas."

Parker said, "I guess continue to hold us accountable. I mean you elect us or not based on whether we do what we say we're going to do. And it will be approved in a budget."

What will happen after the fourth year if the city is doing well Scribner asked. "Can we turn this around and start the other way?"

Parker said that was unlikely. "The way the infrastructure has been left to deteriorate over the last couple of decades, I'm not ready to say that's a possibility."

Keith Dale

Keith Dale, who lives outside the city limits, uses city water and trash services. Those outside the city pay a higher rate for these services. The first year base water rate inside the city is $20. Outside it is $26. The second year, the rates increase to $22 and $26. Dale asked why the increase was larger for outside users.

Sherman explained that outside rates are determined by multiplying the inside rates by a factor. That same factor is used throughout the rates.

Suggesting a possible way to cut his bill, Dale asked if he was required to use the trash service along with the water. At first, the answer seemed to be affirmative. However, Dunham researched the city ordinances and learned that was not the case.

The ordinance states that anyone in the city or within three miles of the city who has a city water meter is required to pay for disposal of rubbish and garbage. One of the exceptions is that someone only using water for a garden or agricultural use may apply for an annual permit exempting them from the trash payment.

James Stallings

James Stallings, a retiree who lives outside the city limits, came prepared with a lot of figures. He said he and his wife use about 3,500 to 4,000 gallons of water a month during the winter. However, during two or three months of summer they sometimes get up to 30,000 gallons a month.

He said last December his utility bill was $52.50 for water and garbage with about 5,000 gallons usage. That would be $74.43 with the first year rate proposed rates or a 42 percent increase. "Now that's quite a bit," he said.

In August 2016, he said they paid $66 for water, which would go to $162.50 with the rate increase, a jump of 146 percent. "Granted, this is 30,000 gallons usage." Adding the garbage charge, he said the monthly bill would be $195.63 or an overall increase of 111 percent.

"Folks, that's heavy duty. That's hard for some folks," he said.

With people spending more for utilities, Stallings suggested, they will have less money to spend at businesses and sales tax will go down.

James Cropp

Alva resident James Cropp wanted to know if the "street deposit," a $5 per month street maintenance charge on utility bills, would ever "fall off of our water bill."

"Can it be revoked at some point in time?" he asked.

"That was voted on by the people, and anything that the people vote in they can vote out," replied Parker.

Cropp said he'd "just like to see something go."

Vicky Hewatt

Vicky Hewatt spoke about the impact of increased rates on monthly budgets. "Some of us are on fixed incomes," she said. Although some may have part time jobs and more flexible income, others aren't so fortunate, she added.

"Some of the older people, they just flat don't have any extra money. No disposable income. I just felt like I had to say something to let you know," she said.

Closing Remarks

Mayor Parker thanked everyone for attending. "We've felt like for quite some time the buck has been passed. Somebody has to pick it up," he said. "We hope it doesn't cripple anybody's ability to maintain themselves. We do feel like it is necessary to get us on the right track moving forward."

Councilmember Mary Hamilton said, "I think as a business person, you guys are all going to feel it. Like Vicky said, we're going to all feel it. But I want to have a water tank up where I live that's going to give me water."

She said the grocery store she and her husband own will feel the increase and need make adjustments to use less water.

"But I want a water tank, that's all I can say. I'd like it (water) to come down to my house," she concluded.

Sherman said, "This is an analysis that's still very infantile in the works, but Alva's median income has increased $9,000 per household in the last five years. And yet sales tax has dropped."

"Send that check to my house," interjected someone from the audience.

"Well, I agree with you," said Sherman. "But according to the census, that's what it's come out to. But sales tax has dropped. So to say that by pulling money out of the economy we're going to hurt it even worse, the money's here. It's still going somewhere else. Whoever those jobs are that are getting that money, I can't tell you; but the money is still being spent somewhere else."

Parker said the rate increase will be on the agenda for the city council meeting on Monday, Aug. 21. "Obviously you have plenty of time between now and then to contact any of us council members. We encourage you to do so."

 

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