Water customers in the City of Fleming-Neon will soon feel the effects of rate increases that will take effect July 1 after being approved in 2015.
The increases were made to help the city qualify for a loan from the Kentucky Infrastructure Authority for the “design phase” to rehabilitate the city water system.
The Fleming-Neon City Council, during its June meeting Monday, also conducted the first reading of a rate increase in sewer fees at the request of the water board, and will hear the second reading of the new ordinance in a called meeting on June 20 at 4 p.m.
Water Board member Mike Dingus presented the board’s request at this week’s council meeting. The vote was unanimous to approve it.
Dingus told the council the sewer rates hadn’t been changed since 2010, and that the board had made a number of cutbacks earlier this year in an effort to get the sewer department’s finances straightened out. He asked that the rate be increased from $12.75 (for the first 2,000 gallons of water purchased) to $15.86, and to $5.50 for every additional 1,000 gallons of water used. Sewer rates are tied to the amount of water each customer uses. Dingus said the rates will still be lower than those in surrounding communities and showed sewer costs in Jenkins and Whitesburg for customers purchasing 10,000 gallons of water. In Jenkins it costs $65.22, and Whitesburg, $63.22. The same usage will cost $56.75 for Fleming- Neon customers, after the rate increase.
Paul Nesbitt of Nesbitt Engineering, which is working with the city to rehabilitate the city’s water and sewer plants, told the council that funders will probably ask the city to institute an annual three percent increase in water rates. Last January’s vote to increase rates called for annual increases tied to the cost of living, but Nesbitt said that funders have indicated that the cost of living increases will probably not be enough to allow the city to cover its production and maintenance cost and service the loans that will be necessary to rehabilitate the water system.
Councilman Tom Haynes made a motion that the council go ahead and pass an annual three percent increase that would go into effect on July 1, 2017, but Mayor Susie Polis said the increase tied to the cost of living hasn’t gone into effect yet and that she would like to see how this affects the water department’s fi- nances before proceeding. Councilman James D. Collins moved to table Haynes’s motion until it can be seen what results the higher rates bring and the council agreed. Water losses for May stood at 35 percent.
Nesbitt told the council that the funding picture for the state looks good, and that he and Polis had visited with Sandy Dunahoo, who served as project development specialist and funding consultant for Nesbitt Engineering before being appointed as Commissioner of the Department of Local Government. He said Dunahoo had asked the city for a plan with six projects that will get the city water plant operating at 100 percent capacity. The Kentucky River Area Development District is working with the city to develop a package to present to Dunahoo. Nesbitt said priority will go to rehabilitating water tanks and installing a SCADA system that will monitor the system and alert workers at the plant if there are problems. He said he expects funding to be available early in the spring of 2017.
Mayor Polis also conducted the second reading of the city’s budget for Fiscal Year 2016-2017. The city budget calls for total projected revenue of $266,558.55 against total expenses of $266,448.44. Water department budgets call for a water budget of $350,000, including $7,500 left from last year, against projected expenses of $348,600. The sewer budget shows projected expenses of $273,800 against projected expenses of $273,031.
Council member Linda Cantrell read a resolution to accept Road Aid Funds from the Kentucky Transportation Cabinet in the amount of $15,157.78 and the council approved.