Committee Recommends Hike In City Sewer Rate

After months of analyzing operational costs, wastewater components and use patterns, Kaempfer and Associates on Monday, March 18 presented Peshtigo’s Water and Sewer Committee a user fee proposal designed to cover reconstruction costs for the wastewater treatment plant plus its annual $978,400 operating budget. The sewer utility has been operating at a loss for many, many months. The proposed new fees are designed to cover that loss and make payments portions of the current improvements that are not fully financed by grant programs. New operating efficiencies are predicted as a result of the improvements, and that too will bring the deficit down. Engineers predict that energy consumption will be cut in half.

If accepted by Peshtigo City Council the new fees could show up on the bills received in July for second quarter billings to users of the Peshtigo Wastewater Treatment Plant. According to the engineering analysis, the average household sewer bill will go from $45.35 a quarter to $71.55, a 57.8 percent increase. These are averages, not set rates. Some residential bills will be higher than the average, and some will be lower.

Kaempfer Senior Engineer Tarryn S. Nall said their studies showed the average residential sewer user in Peshtigo with a 5/8-inch water main used 39,500 gallons of water in 2011. Existing sewer charge for this size water main is a base of $13.75 per quarter and the variable charge of $3.20 per 1,000 gallons on that 39,500 average brings the total to $45.35 for the quarter or $181.40 per year.

If Council approves the proposed new rate schedule the user charge will include a base of $21.48 per quarter plus a variable charge of $5.07 per 1,000 gallons. If the household uses the average 39,500 a year the quarterly bill would be $71.55, for an annual cost of $286.20.

Under the new structure, BPM, Inc. will continue to operate the plant for the city, but the city will pay directly for energy and supplies such as chemicals, equipment, etc. and those costs will be distributed evenly to all customers.

The new rates include new charges for large volume sewer customers as well. The Class C rate will be $53,372.14 per quarter plus 20 cents per 1,000 gallons of flow, 29 cents per pound for BODs, and 9 cents per pound for suspended solids. Class A and B customers, with meter sizes ranging up to 12 inches, will pay basic rates based on meter size and $5.07 per 1,000 gallons of water used, plus a surcharge if the wastewater is of greater than domestic strength. Fees for Class D customers, those who haul wastewater to the plant and do not use the sewer system provide for a $5 per truck load flat rate and variable charges of $5 to $32 per 1,000 gallons depending on the type of wastewater. A $45 testing fee will be imposed when testing is required.

BPM General Manager Jim Koronkiewicz said the numbers looked right to him.

“At least they’re in the black,” Alderman Tom Gryzwa commented.

Committee vote to recommend that Council approve and implement the proposed new rate structure was unanimous.

Alderman Fred Meintz, committee chair, asked City Clerk/Treasurer Mary Ann Wills if it might be possible to start the new fees for the second quarter, which starts April 1. “We’re losing more money every day,” he commented.

Wills noted they had implemented the new water rates a bit retroactively, with permission from the Public Service Commission. She said the city does not need PSC authorization to raise sewer rates, but if members of the public feel aggrieved they can file a complaint with the state agency.

Nall said another community his firm works with did go retroactive for a couple of weeks of service with no problems.

Wills pointed out if the Council adopts the new rate schedule at their meeting on Wednesday, April 3 the City Attorney will need to draft an ordinance, after which Council will need to hold a public hearing with proper legal notice before they can adopt the ordinance and implement the new fees.

Mayor Al Krizenesky wondered what sort of billing problems they might encounter. Public Works Director George Cowell said they normally read meters the last week of the quarter, which in this case would be the week of March 25.

Committee members then agreed that April 1 would be the best time to start the new rates, as there would be no need to go back and read meters again, and the billing complications Krizenesky mentioned would not happen. Customers will not see the effect on their bills until the end of June or early July when the new bills come out.

Krizenesky suggested if necessary they could call a special Council meeting for final approval.

Meintz thanked the Kaempfer people for the diligent work they had put into the study, and added, “It took some time, but it is done very well.”

Next on the agenda was a status report on the wastewater treatment plant reconstruction project. Meintz noted they started with a $1.6 million estimate “and now we’re already up to $1.944 million, with more change orders to push the total even higher.”

Kaempfer Engineer Don Heikkila said the last change order came because they found it necessary to replace some pipes and valves that were found in bad condition, and expects they will find more that are just as bad as the work continues.

Meintz noted they also are still wrestling with a decision on some electrical issues. Discussion ensued on the possibility of putting a large project out for new bids rather than awarding the work to Elmstar Electric at their quoted price. The possibility of using an existing source on Harbor Road for the added electric feed was eliminated after conferring with Mark Hannon of WPS, who told them once WPS abandons conductors they are not reactivated.

WPS has extended its deadline for energy saving incentive payments to July 31, which enables the contractors to wait until frost is out of the ground for running underground electric lines. Some other portions of the work, particularly on the aerators, cannot be done until the lagoons thaw. Because of the continuing cold this year they may need to extend that deadline beyond the June 30 target date.

“The big question is, when will winter be over?” Heikkla commented. He will talk to the contractors and get their opinions on several issues prior to the April 3 City Council meeting.

Moving on to other issues, the committee authorized Cowell to get prices on a piece of equipment to help do locates on underground sewer, water and electric lines. He estimates the price will be between $2,800 and $3,800.

Cowell reported he has been advised by Wendy Anderson of the DNR that there are new federal regulations on fluoride levels in water, and the naturally occurring fluoride in one of the city’s wells is slightly above that limit. The suggestion is that they should quit adding fluoride to the city’s water supply.

Cowell reported during the past month there was one force main break, but it was fixed right away and did not affect anyone.

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