Probable rate increase on horizon for city utilities
December 05. 2013 9:33AM
Brandon’s city sewer and water rates will likely be going up at the start of 2014.
While the water rates will only see a 3 percent increase, the sewer rates – based on 5,000 gallons of usage per month – will see an 87 percent hike.
The increases are necessary to fund $22.5 million in updates and expansion to the city’s sewer and water systems. The proposed utility increase will cover the $22.5 million project costs, according to City Administrator Bryan Read.
“Projections show this would pay for it all, and it includes a growth factor,” he said.
If the Brandon City Council approves the rate hikes next month, users will see the first increase on their February bill. A first reading regarding the proposed rates is expected to be on the Council’s Dec. 2 agenda, with the follow-up reading on Dec. 16.
The water rate increase for 5,000-gallon users will go from $29.75 monthly to $31.33. The sewer rate, also based on 5,000-gallon usage, will jump from $29.75 to $56.75 per month.
Gabe Laber of Stockwell Engineers said the 50,000-gallon or higher users would see the biggest increase at 100 percent.
“The big guy is basically going to be doubled,” Laber said.
After the city conducted studies of its sewer and water systems last year, officials began looking at what we can do with the current flows, Read said. The options were basically limited to two: Continue to pump more sewage to Sioux Falls for treatment or build a new waste water treatment facility to accommodate the city’s population.
The current ponds were built in 1982 when Brandon had a population of about 2,500. The city’s population today hovers around 9,000. The proposed facilities would be designed for a population of 16,000.
A new wastewater treatment facility is tagged at about $10.5 million, while $12.5 million would be earmarked for sewer maintenance improvements, which would be done in two phases. The first phase would eliminate seven lift stations now positioned between Redwood and Aspen boulevards on the east side of the city. A major interceptor from Aspen Boulevard northeast to the Bethany campus would be added.
“We don’t have to do those today,” Read said. “But if we don’t do them, it will be more costly over the long term to increase pumping to Sioux Falls.”
Currently, the city spends about $400,000 annually in pumping costs. Sioux Falls charges $4 per 1,000 gallons, and Brandon pumps 300,000 to 350,000 gallons per day. Those costs, Read said, are expected to increase as well.
“In the long run, it will be cheaper to build our own facility,” he said.
If the city chooses to continue to pump more sewage to Sioux Falls, Read expects those costs to more than double, if not triple.
The water improvements include drilling three new wells, which is currently underway, correct some looping issues, which impedes the flow of water, construct two water towers and expand or build a water treatment facility.
By increasing water and sewer rates, the city stands a better chance of securing state and/or federal grant monies. Laber said he’s seeing the state “pushing communities into the $40s (per month).”
Under the proposed rates, Read said, “We’ll be over that so we’re certainly going to apply.”
The City of Bonesteel was recently awarded a $2.5 million grant, which covered about 75 percent of their project costs. Their monthly rate is $52.50, Laber said.
If approved by the Council, the design of the wastewater treatment facility would be done in 2014, with construction taking place in 2015. In 2016, the city would bring the main interceptors online.
The last increase for city water and sewer rates was in 2011, and it was a 3 percent across-the-board increase.