If the Thomaston City Council agrees with City Manager Patrick Comiskey’s recommendations for the 2014 budget, city residents could be seeing rate increases in water and sewerage, electricity, and sanitation on their bills.
At a budget work session held on December 3, Comiskey presented his projections for the three enterprise funds in the budget. Under water and sewerage, Comiskey noted than from 2007 until today, water usage has shrunk from 622 million gallons of water a year to 385 million gallons, a 38 percent drop in usage. He said the city’s biggest challenge has been trying to run the utility with less usage, but with the same fixed costs.
“We’re basing our revenues on 385 million gallons of water usage for 2014, which is what we had for 2013,” Comiskey said. “The only potential change in our usage could come from this power plant (Lancaster Energy) that is going to be firing up sometime in the first half of next year. We will see how much usage they have, and it could be a real positive for us and we’ll see how much it changes these figures.
“Our total projected budget for 2014 is $5.2 million. We’re looking at proposing a rate increase of 50 cents per 1,000 gallons of water, and 45 cents per 1,000 gallons for sewage. We’re estimating that the water increase will generate $190,000 and the sewer rate will generate $150,000. Added in with our current rate, that will generate $2.5 million in revenue on the water, and $1.8 million in revenue on the sewer. In addition to that, we’re projecting that we’ll transfer $800,000 from the electric fund that we already have in the bank to help fund the projects that we have in the budget.”
The biggest expenditure of water and sewerage revenue is the water service contract with Severn Trent. Comiskey said they are currently negotiating a new two-year contract with the company, and added that the city is happy with what the company has done.
“Severn Trent has been very good in trying to meet all our expectations,” the city manager said. “They are very good to work with. They haven’t met all of them, but they’ve made some significant inroads, one being cleaning sewer lines. We’re expecting about 80 percent to be done by the end of the year.”
The city also pays about 28 percent to debt reduction.
The biggest project expected to take place in 2014 is the refurbishing of the Davis Lake water tower, which has been estimated to cost about $600,000. Comiskey said that is where the bulk of the $800,000 they are borrowing from the electric fund will go. The remaining funds will go toward other water and sewer line projects and needed equipment purchases.
For the city’s electric utility, the biggest expenditure will be the bill from the Municipal Electric Association of Georgia (MEAG), which Thomaston is a member of and which provides the city power.
“The big issue for us which is coming up is our bill from MEAG is projected to be $11.4 million next year, and that represents a 5.7 percent increase on our bill from the previous year,” Comiskey said. “This has been a trend the council is aware of. We’ve had increases over the last several years; it has been going on throughout the industry. Georgia Power is getting publicity for being in the process of requesting a rate increase from the Public Service Commission.
“What I’m proposing here is taking our kilowatt usage and our projected revenue based on 2014 projections and taking a 6.5 percent increase for each of our service categories – residential, commercial, and industrial. A 6.5 percent increase would generate $750,000 and offset the 5.7 percent increase, and also allow us to increase our spread, which has been consolidating over the last couple of years, because we weren’t passing the increases on.
“As far as the revenues go, the total operating budget would be $15.3 million. The biggest hit would be the purchase of electricity for $11.4 million. We are transferring $800,000 to the water budget, of which $600,000 will be used to refurbish the Davis Lake water tower. The council also traditionally transfers $1.1 million to the General Fund.”
Under sanitation, Comiskey noted that the city had to borrow money from the general fund in 2011 and 2012 to meet its sanitation budget. He is recommending an increase which will allow the sanitation department to meet its own expenditures without having to borrow from the general fund.
“We’re proposing a 75 cents per month increase on each person’s garbage bill, and a four percent increase on the general commercial bill.”
Comiskey said the increase will help cover the biggest expenditure the department has, which is the garbage service contract with Transwaste, and still leave about $22,000 in the budget.