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City council discusses utility rate increases

December 17, 2019

Webster City Mayor John Hawkins began Monday night’s City Council meeting with a resolution thanking council member Jim Talbot for his four years of service. Monday was Talbot’s final regular council meeting.

The council continued on with the swearing-in of the newly-elected and re-elected city council members – Katelin Hartmann, who will start her first term on Jan. 1, and Brian Miller, who will continue serving the city council.

At the end of the meeting, Talbot had a few words he wanted to share.

“I would like to thank all the city employees who have been very helpful this last four years to me,” he said.

A public hearing regarding proposed plans, specifications and form of contract for the city’s 2019 Building Demolition Project was held during the meeting. Prior to the meeting, the council received no written objections and there were no oral objections presented during the hearing.

Following the hearing, the council voted unanimously to approve the final plans and specifications and awarded the contract to Mid Iowa Site Services, of Fort Dodge, for a contract total of $38,940.

The project will affect 940 Third St., 1021 Clark St. and 1014 Elm St.

The City Council also set a date for a public hearing on a proposal to enter into a general obligation corporate purpose loan agreement for $9.5 million to fund city street construction and improvements. The hearing will be Jan. 20 at 6:05 p.m. in the City Council chambers in City Hall.

Another hearing will be held on Feb. 3 at 6:05 p.m., also in the council chambers, concerning proposed plans, specifications and estimated costs of the 2020 Second Street Reconstruction Project, as well as the 2020 Electrical Underground Conversion Project.

Northland Public Finance presented to the city council the results of a water and sanitary sewer utilities rate study it completed recently.

“One of the first projects I began when I started as city manager was a thorough evaluation of the public utilities,” said City Manager Jeff Sheridan. “As a part of that, I engaged Northland Public Finance to conduct rate studies on both water and waste waters.”

The last rate increase for each of the utilities happened in 2011, Sheridan said.

The purpose of this study was to determine an appropriate level of rate increases, which would then contribute to funding maintenance and upgrades to the aging water and wastewater utility systems, Sheridan said.

Through Northland’s study, the firm came up with three rate adjustment scenarios for water rates and wastewater rates. The first scenario is increasing both by 12.5 percent for the next three fiscal years, and then by three percent for the two following.

The second scenario is to increase each by 9.5 percent for the next five fiscal years.

The third scenario, which is the one Sheridan recommends, increases each rate by 28 percent for Fiscal Year 2021 and then only by three percent for the next four fiscal years.

“The immediate rate increase will put us in a better fiscal position to begin funding the much-needed wastewater treatment plant, but it will not fund it entirely,” Sheridan said.

Members of the city council did raise concerns about the financial impact the rate increases will have on Webster City residents, especially with the city pursuing a new general obligation bond for another city project.

Following the presentation from Northland Public Finance and Sheridan’s evaluations, the city council did not take any actions. Instead, the council will hold a public work session in January to further discuss the impacts these rate increases will have on the residents of Webster City. The date and time of that work session has not yet been determined.

 

View this article as it originally appeared in the Daily Freeman-Journal.

Last modified: December 17, 2019

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