Utility rate increases appear a sure thing

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By Matt Ward

 

Utility customers in the city of Fredericksburg will likely see changes in their monthly bills later this fall as the city council prepares to adopt a series of rate changes and hikes.

No decisions have been made on any increases, but they are expected to be in place by Oct. 1 when the city’s 2013-2014 budget will go into effect.

During a special budget workshop July 31, the council received a presentation from Tony Bagwell of HDR Engineering, the city’s utility rate consultant, who said that deficits in city utility funds need immediate attention to prevent a larger problem.

“To address the deficits in the water and sewer fund, some pretty dramatic action is needed,” Bagwell said. “The fund balances and the trend in fund balance are such that we’ve got to get it fixed.”

Without a rate increase, the water fund — comprised of both water and sewer services — is expected to show a deficit of more than $900,000 in next year’s budget.

“Some council at some point has to deal with it,” Fredericksburg Mayor Jeryl Hoover said. “We talk about how excellent we provide the service and how good it is that you get what you get and surely you don’t expect things to stay the same for eight years.”

On Friday, city staff will meet with Bagwell to develop their final recommendations based on the initial council direction.

Those recommendations will be presented during the council’s Aug. 19 meeting for additional discussion before final approval of changes in September, City Manager Kent Myers said via email Monday.

“Therefore, until the steps outlined above are taken, it is premature to report how any proposed rate increase would impact various categories of commercial or residential customers,” Myers said. “However, we will keep you informed as we move through this rate-setting process.”

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