The first reading of a new ordinance with lowered sewer rate increases received unanimous approval at Monday night’s Nevada City Council meeting.
The ordinance would increase water rates 5 percent annually and increase sewer rates 1 percent annually over the next five years. Originally, the annual rate of increase for sewer use was set at 2.5 percent. Council approved an amendment to the original resolution, which lowered the proposed sewer rate increase to 1 percent, during their regular meeting May 28.
The proposed rate increases are the result of a Water and Sewer Rate Study performed by HR Green, Inc. The increases are needed in order to maintain reserves in both the water and wastewater departments to help fund planned capital improvement projects, repairs and equipment purchases. Every three years, the city completes a major street improvement project. In 2014, C Avenue, Valley View Drive and part of Third Street Place are planned to be reconstructed. Without the increase, future city councils may be forced to implement steeper rate increases to make up for a lack of reserves.
If the increased rates pass the second and third readings, the average monthly water and sewer bill for residential customers is expected to increase an average of $2.86 each of the next five years. For commercial customers, an average yearly increase of $1.77 may be noticed on their monthly bill.
Lynn Lathrop, representing Burke Corporation, said Burke has concerns about the rate increases. The company uses approximately 30 percent of the city’s water consumption and does not feel they need to help fund infrastructure improvements, since the planned improvements are not near their facility.
Councilman Brian Hanson said residential customers could argue the same thing about not having to pay the increased rates because the infrastructure improvements may not be happening in their neighborhood. Making an exception for Burke may open the door for similar requests.
Lathrop requested city staff and council members meet with Burke representatives before the council’s next meeting to go over the proposed rate increases.
"There’s just a lot of questions that need to be dealt with before moving forward," Lathrop said.
Other agenda items included:
- The appointment of Richard Atwell to fill the Ward 2 seat on the council - Atwell was the only applicant for the vacancy, and his appointment was approved unanimously by council. He was sworn in by Mayor Andy Kelly following his appointment.
- A salary increase for City Administrator Elizabeth Hansen - The increase comes after council members completed a review on Hansen’s performance as city administrator. Council went into a closed session, pursuant to Iowa Code Section 21.5 (1) (i), to discuss Hansen’s performance. After coming back into open session, it was decided to increase Hansen’s salary by 2.5 percent, bringing her annual salary to $92,289.60.
- A temporary construction easement agreement with Nevada Economic Development Council (NEDC) and Dale Sorem - The easement is needed to install a sanitary force main along the west side of Airport Road and the south side of West K Avenue. The main will serve the future DuPont facility on the west side of town. City engineer Larry Stevens explained a sanitary force main is a small diameter pipe (4-inches in diameter, in this case) that pumps the sewage uphill. An easement is needed because the pipe will be installed on property owned by the NEDC and Sorem. Council approved the easement unanimously.