Water and Sewer (Part 2)

Thanks for hanging in there with me….

So, we’ve developed a model that guesses at costs for the Long Term Control Plan to resolve the combined sewer issue, for the scheduled replacement of older water and sewer pipes throughout the city on an as needed basis, and for the operation and renovation of the water treatment and wastewater treatment (sewer) plants as needed over the next 25+ years.  If implemented, this would provide reliable, sustainable water and sewer service over the foreseeable future.

So what does that mean to you?  Probably nothing in the short term.  As we move on, your costs for water and sewer service will be going up, and if estimates prove correct when actual costs are calculated, they will be going up fairly significantly over the next decade.

Each year, the City of Oakwood compiles water and sewer rates for 63 communities in Southwest Ohio.  In 2014, Middletown was the 17th cheapest of the 63 communities surveyed.  So Point Number One… City residents have already consistently had the benefit of cheaper water and sewer costs over 2/3 of the surrounding communities in Southwest Ohio. That’s good for your monthly pocketbook, but I wish our water and sewer rates had been closer to the middle of the pack during the last decade and that we had started this process earlier.  If we had been paying more earlier, then we would not have to raise rates as high and as fast moving forward to complete all of this work.

Now… having said that, I don’t believe that it was realistic to significantly raise water and sewer rates during the Great Recession.  Can you imagine if during the recession, when unemployment was 10-12%, when no one got raises and families were happy just to be working, and over 3,000 Middletown families were in foreclosure, City Council announced that they were raising water and sewer rates 5-10% per year for several years in a row?  I know government is often seen as insensitive, but that was probably not a real possibility when so much of the city was struggling.

Point Number Two – the Long Term Control Plan (LTCP) really drives this process.  Until that is negotiated to a final outcome with costs, the rest is just speculation.  If we resolve that issue sooner, we can start getting a more complete understanding and costing of the remaining work in light of the LTCP requirements.  If LTCP negotiations lag into future years, then a lot of the costs remain murky.  We will be starting work on the condition of our delivery system (the pipes) during the next year to complete that inspection process while we continue negotiations on the LTCP.

Point Number Three – The only absolute here is the LTCP.  That will be required by federal law.  The  remainder is theoretically discretionary.  Early estimates on the rate increases needed would move us from the bottom third of costs compared to surrounding communities, to the top third.  This is going to hit your wallet every month, more each year, when implemented.  We could choose to let our infrastructure deteriorate and pass the cost along to the next generation.  That seems foolish to me, and inflation will continue to drive the needed costs up as time goes on.  It will be cheaper to start sooner than let inflation drive up costs for the same work later.

I am in my eleventh year working at the City.  During that entire time, I have heard over and over that the city needs to get back to providing the core services of infrastructure, public safety and quality of life, to its residents.  We failed to do this with paving and  you can see the results.  If the community demands that we keep rates low and do not maintain our water and sewer infrastructure, then you can’t look back later and complain that “the stupid government” didn’t take care of things again.   This is where we are today. I’m going to recommend that you take care of this now.   If we don’t do that as a community, then at that point, respectfully,  it’s on the community, not your government that  you made a conscious, educated decision not to sustain your infrastructure.  I’ll operate with whatever decision City Council and the community make in this area.

Point Number Four –  When the LTCP is finished and the other costs have been more firmly established, here is the general sequence of how I see this rolling out:

  • A public analysis of prior increases for the past 10-15 years including when we raised rates, the purpose for the rate increase, and the future results after the rate increase.  If it was for capital, did we complete projects and if so, which ones at what cost, etc.?   One of the questions we get is “what happened to all the money from prior increases?”  We’ll start with those answers.
  • A detailed public analysis of the costs to maintain the system for the next 25 years.  This would include the LTCP, the actual pipe inspection results, and detailed expected costs at the two plants.  This is why we believe, in detail, that rates need to be increased and the timing of those costs.
  • Potential offsets to those costs.  NTE will use 1 million gallons a day when operating.  What does that do to support these costs?  We still have excess capacity after NTE.  Is there some place we could sell it to further offset these costs?
  • Is there any benefit to getting out of the water business and buying water and sewer services from another source?  Would it be cheaper to buy water from Dayton or Cincinnati or Butler County than completing all of this work?  I firmly believe the answer to that question is no, but it deserves full analysis and consideration.  What is best for our city residents?
  • What then are the rate increases and timing necessary to complete all of this work and to know that your water and sewer service infrastructure is safe and consistent over the next several decades?  Is there a way to help seniors, low income families, etc., handle these increased rates?

I’m not insensitive that many families will struggle to find the extra money to pay increased water and sewer costs in the future.  The only other option, however, is to make a conscious choice as a city not to make needed repairs and to at some point jeopardize your water and sewer infrastructure.  It’s an imperfect solution to a problem that won’t go away and that will only get worse and more costly as time moves on.  I’m attempting to put the city on a course that solves that issue for at least the next two decades.

 

 

3 thoughts on “Water and Sewer (Part 2)

  1. Doug, normally I agree with your plans and visions for the city, and I DO agree that the water and waste water infrastructure undoubtedly need attention. I lived out of Ohio for 20 years and moved back 7½ years ago. Since moving back in 2008, my water bill has increased 27.5%. As a now single, retired, head of household on a very limited fixed income, your statement that, “your costs for water and sewer service will be going upgoing up . . . fairly significantly over the next decade” is disturbing. It seems to me that nearly 30% in a seven year span is already significant!

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