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Gainesville unsure on water, sewer rate increase

POSTED: March 30, 2014 12:05 a.m.

The Gainesville Public Utilities Department is proposing a 2.25 percent increase in the water rate for the 2015 fiscal year, and a 1.25 percent increase in the sewer rate.

But City Council members have expressed a desire not to increase water rates this year. They fear increased costs might inhibit new residential and commercial growth, which is showing signs of rebounding after years of stagnation.

“Right now, the council is not sure which funding plan we’re going to adopt,” Councilman George Wangemann said. “We certainly don’t want to put a huge increase on our largest water users.”

The proposed rate increase comes at a time when two factors have impacted Public Utilities’ revenue stream.

First, as a result of the economic recession, growth in population and water users in the city have not met expectations.

And as more residents become conscious of the need to conserve water, coupled with available technology such as low-flow toilets, water use has decreased significantly in recent years.

The numbers bear this out.

In 2000, 17.9 million gallons of water was pumped into the city’s system on a given day. That figure rose to 19.7 million gallons per day in 2006, before dropping off to 16.4 million gallons a day last year.

Moreover, Public Utilities Director Kelly Randall said that based on population estimates across Hall County, water use had fallen to 87.4 gallons per person per day in 2013 from 128.5 gallons per person per day in 2000.

“That’s a considerable drop in usage per person,” Randall said.

But despite these trends, some members of the City Council insist that allowing growth to take shape without imposing more expenses on residents and businesses is critical to generating economic growth.

“I’m in the camp of no increase,” Councilman Sam Couvillon said. “We’re starting to see (new) growth. And with that growth, now is probably a time that we can look at our community, at our citizens and be able to tell them that we’re going to hold the rates, hold the line …”

But there may be some need for a compromise, Wangemann said, perhaps setting the rate increase at somewhere between 1 percent and 1.5 percent.

“Naturally, I’d like to see no increase,” he added. “Whether that’s possible, I don’t know.”

If City Council ultimately approves a lower water rate than proposed, one alternative to offset the loss in revenue is raising the account servicing fee, which covers the cost of reading meters, sending bills and related customer service issues.

“Currently, (the fee) is not fully funding itself or paying for itself,” Randall said.

He has proposed raising the fee 50 cents each year for the next few years.

Meanwhile, the Public Utilities debt service has remained steady in recent years, thanks in large part to the fact that cash, rather than loans, is being used to pay off such items as facilities and road-widening expenses associated with new infrastructure development.

The debt service totaled $21.4 million in the 2013 fiscal year.

“We’re trying not to borrow any money,” Randall said, adding that 84 percent of construction costs in 2005 was paid for with borrowed money, while that figure will zero out by 2015.


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