The recent increase in water rates for customers served by the City of Neon was necessary because independent audit showed the city couldn’t repay loans without the rate hikes.
That’s the explanation given this week at the Fleming Neon City Council’s March meeting after city water commission member Brandon Fleming asked why the raise was put in place. City Engineer Paul Nesbitt told Fleming the rate increase was demanded by funding agencies who determined it was necessary to insure the city would be able to repay the loan portion of the funding. Fleming said he asked the question because he and other commission members have been receiving calls from customers asking if the raise was necessary.
Council Member Susie Fleming asked if the annual three percent increase that was also passed when the rate increase was adopted would ever be taken off, and Water Manager Chris Banks said it is unlikely. Banks told the council that nothing in the water business goes down in cost, pointing to regular price increases in water treatment chemicals, equipment, power bills, and other necessary expenses, not to mention regular maintenance costs.
In answer to another question by Fleming, Nesbitt said the Kentucky Infrastructure Authority, which obtains and help administer loans and grants for water and sewer projects, would have refused to fund the work in the Fleming-Neon area.
In a related matter at Monday’s meeting, the council learned that bid specifications will be advertised this week for the first phase of improvements to the Fleming-Neon Water Plant. Angelia Smith-Hall, a representative of the planning agency Kentucky River Area Development District, told the council that advertisements for bids would appear in this week’s edition of The Mountain Eagle. Nesbitt, who owns and operates Nesbitt Engineering, that bids would be opened on April 5 at City Hall at 1:30 p.m. Nesbitt also told the council that payment bonds will be required as part of the bid package to ensure that sub-contractors will be paid in the event the main contractor pulls out of the work.
Nesbitt said city will receive a total of $3 million for the project, and will only have to repay $750,000 of that amount. The rest will come from grants.
Councilman James D. Collins asked whether the repeal of the Kentucky Prevailing Wage Law by the Republican led General Assembly would affect work on the water system. Nesbitt said that since much of the financing comes from federal sources, the federal prevailing wage would be in effect.
Mayor Susie Polis addressed questions from citizens about why the city does not get grants to repair buildings in the city. Polis said the council only owns three properties in the city — City Hall, the park/stage area across the street from City Hall, and the now-vacant lot where the old Fleming-Neon Public Library stood. She said the city traded another lot it owned to the Letcher County Library Board for the old library lot and paid $40,000 to have the site for the new Fleming-Neon Library cleared.
Polis said the city cannot get grants to do work on property it does not own, and it is illegal to spend public funds on private property. She said all the other buildings in the city are privately owned and city funds could not be spent to improve them
The council also went into executive session to discuss a personnel matter. After emerging from the closed session, Councilman Collins introduced a motion to either repair the city’s time clock or replace it. His motion was approved unanimously.