By Lynne Hendricks
AMESBURY — Homeowners who have enjoyed steady rates on their water and sewer bills for the past two years will likely be seeing a sizeable rise in their quarterly invoices as the town looks to make up revenue shortages and begins paying for a new water treatment plant.
The town is holding a public hearing on Dec. 3 to propose an increase of 70 cents per 100 cubic feet of water usage, and a 55-cent hike in the sewer rate effective Jan. 1, to cover what Mayor Thatcher Kezer said is related to less usage, resulting in less revenue.
"We've been having to hold back about $150,000 to $200,000 in expenses because our revenues have not been hitting our marks," said Kezer on the reasons for the looming hike. "We've not raised rates in two years.
"What's happened is in the last couple of years we've been having to cut back on maintenance because the revenues coming in don't match," he said. "As the water and sewer demand fluctuates, our revenues fluctuate with that, and we've been having to hold back on the expenditure side because of the fluctuations."
The hike represents the first of what could be several increases as the costs to finance an $18.3 million water treatment plant come due, the first of which could come as early as mid-2010.
The town is slated to receive approximately $3 million in loan forgiveness from the American Recovery and Reinvestment Act of 200, which represents about 16.5 percent of the total cost. The remaining funds will come from taxpayers through the issuance of a bond, which Kezer said will lead to more increases in the water/sewer rates in the near future.
"There will be future increases as we anticipate the bonding schedule for the new water treatment facility," said Kezer. "We're looking at the numbers now, and we may be coming back in six months or a year (for another increase). We want to start adjusting the rates sooner so that we can build up the account so that when the debt service is at its highest peak, we don't have to keep raising rates all the way to that level."
According to Kezer, the initial hike will result in an extra $70 annually for residents fitting the "typical" usage profile of approximately 3,000 cubic feet or 22,400 gallons of water a year. For the average family of four that uses closer to three times that amount, the increase rises proportionally.
"There really isn't any typical (usage)," said Kezer. "If you have a couple of teens in the house taking 30-minute showers, that's going to have an impact."
The irony of the usage rate hike is that it's brought about in part by residents' efforts to curb water use in the last couple of years, as a means of either saving money or becoming more aware of their impact on the environment. Their decreased usage has negatively affected receipts, according to Kezer.
"Over the last several years (decreased usage) has had an impact," said Kezer. "On both sewer and water the biggest part of the costs are all capital investments. Those are all fixed costs. We have to pay those capital costs no matter what the usage. It's not like our costs go down."
The proposed water usage increases take the current cost of $4.50 per 100 cubic feet to $5.20 and bring sewer costs up from a rate of $5.05 to $5.60, said Kezer.
In the meantime residents currently paying the typical $576 annually for their water/sewer service can expect to pay approximately $648 should the increase be approved, and more if their usage exceeds the amounts cited as typical.
"People's usage is all over the place," said Kezer. "We define 3,000 cubic feet of water use, and the current use is $272 for water and $304 for sewer. The new rate for water would be $312, and the sewer would be $336. Because we do quarterly billing — that's about $18 a quarter for an adjustment."
The public hearing for the rate increase will take place Thursday, Dec. 3 at 6 p.m. in the Town Hall auditorium. Written comments can be addressed to the Town of Amesbury — DPW, 9 School St., Amesbury, MA 01913.
