Study to find whether utility rates need boost

By Jonathan Delozier -

Rates for Wellington’s water, sewer, and storm sewer services will be evaluated by the Poggemeyer Design Group to see whether they are high enough to meet expenses.

The study will cost the village between $12,000 and $15,000.

Village officials have emphasized that any revenues gained from a rate increase would be meant to keep that specific utility’s fund solvent. That means, for example, that water your water bill has to pay for water services, not police, roads, or firefighters.

“No one has done a study like this for a long time and the funds are barely making the expenses they need to cover,” said village finance director Vanya Hales. “A study used to be done by an outside source every five years and the last one was done in-house. It’s something you have to look at every few years to keep up with the cost of doing business.”

Hales said the last study by an outside company was done sometime prior to 2006 — the exact year is uncertain.

At the end of 2014, the village water fund totaled $144,485, sewer money sat at $151,229, and storm sewer at $162,644.

Now, water is at $241,790, sewer $59,848, and storm sewer $72,120.

“There isn’t a whole lot of concern with the water rate,” said Hales. “It’s more the sewer and storm sewer funds because of the debt they’ve taken on in the past few years. The sewer rates are based on the water rates and they’re intertwined. Repairing sewer lines alongside street reconstruction and repairs made to the sewer plant a few years back have contributed to the funds declining.”

Residents pay $7.75 for every thousand gallons of water used and a flat rate of $3.50 per month for storm sewer amenities.

Electric rates could also be looked at in a separate evaluation that would cost an additional $10,000 to $15,000.

There are two existing classifications for electric customers: residential, which pays 12.5 cents per kilowatt hour, and commercial, which pays 14 to 16 cents per kilowatt hour.

A study of the electric services could also weigh adding a new “small commercial” classification.

Council member Keith Rowland asked during a recent meeting whether a tax increase or levy could accomplish the same things as rate increases, but Dupee said tax revenue is not used for utility funds.

“When we’re talking about enterprise funds for services like these, the rates for those services are what puts money in those funds,” said village manager Steve Dupee. “You really can’t mix tax revenue with that. We fund our utilities through our rates.”

Jonathan Delozier can be reached at 440-647-3171 or @DelozierNews on Twitter.

By Jonathan Delozier