$4.9-million contract approved for work to start on three, one-million gallon water tanks
The Fredericksburg City Council voted to move on to a second reading regarding increasing water and wastewater rates at their 6 p.m. meeting Monday at the Law Enforcement Center, 1601 E. Main St.
A customer with 5,000 gallons of wastewater per month will see a monthly increase of $2.80 on their wastewater bill, and a water customer who uses 10,000 gallons of water per month will see a monthly increase of $4.63 per month.
“It’s been a number of years since we last increased our utility rates,” City Manager Kent Myers said. “After a rate study was completed last year by HDR Engineering, we found that we needed to increase our rates to help fund Capital Improvement Projects to our water services.”
As an example, Myers said the city began an $18 million water bond project earlier this year that will help provide more reliable, long-term water services to the community. The bond project includes three new water tanks and a water main along U.S. 290 East to provide more reliable access to the city’s water wells.
Myers added they decided to phase in smaller rate increases, as opposed to a single increase in one year.
This is the second of three phases to raise water and wastewater rates. The first increase was approved in February, and went into effect on March 1.
With that increase, customers who used 10,000 gallons of water per month saw an increase of $4.11 per month, and customers with 5,000 gallons of wastewater per month saw a monthly increase of $1.33 per month.
The third part of this phased approach will be evaluated as part of the budget discussion next year.
“Depending on the operating budget and the debt service at that time, we’ll visit council again as to whether or not the third rate increase is needed,” said Kris Kneese, assistant director of public works and utilities.
These rates have been included in the Fiscal Year 2020 Budget as a revenue, Kneese said during the meeting.
Council member Gary Neffendorf asked during the meeting if refinancing existing debt would help keep rates lower.
“(City mananger Kent Myers) sent something out today that talks about refinancing of existing debt because of the low interest rate. Would that generate enough savings that I think we might want to look at keeping the rates a little lower?” Neffendorf asked.
Myers responded to the question by saying they will look at that as far as the third phase.
“That will certainly help us,” Myers said. “We’re looking to avoid or minimize the third phase.”
This was only the first reading, and the second reading is scheduled for Oct. 21. If approved, the rate increase will take effect on Nov. 1.
Ground storage tanks
In other business, the council also approved a $4,920,800 contract to Preload, LLC for construction of three one-million gallon water tanks.
These tanks will be constructed at the Cross Mountain Tank Site, the North Tank Site and the Knauth Well Field, the latter two of which are east of the city limits.
“The tanks at the Cross Mountain Tank Site and the North Tank Site are welded steel tanks, which requires interior and exterior maintenance every 15 years,” Kneese said. “The city’s water distribution system is divided with pressure plains, and the Cross Mountain and North Tanks must remain in operation at all times to continue providing water pressure to about 1,500 customers.”
Kneese said in order to keep these tanks operational, the city is constructing two concrete tanks so that they can take the steel tanks offline in order to perform maintenance on them.
The Knauth tank, Kneese said, is being installed as part of the U.S. 290 East waterline and pump station project. Installing this gives the city a redundant line from the Knauth Well Field to Fredericksburg.
The contract for this project is being funded by water revenue bonds that council approved in November of 2018.
Kneese expects the tanks to be completed by the fall of 2020.
In other business, the city council also:
• Held a public hearing regarding annexation of roughly 117.1 acres of land situated on the south side of West Live Oak Street and extending from the east of Post Oak Road and to the west of Smokehouse Road. The only person who spoke was Bobby Stewart, who is planning to build apartments on this land, and requested his part of the land to be R3 multi-family apartment zoning. No action was taken at this time.
• Approved an ordinance amending building regulations regarding fire protection to comply with updated versions of the International Codes.
• Approved a contract with HHM & Associates for professional services to update the Historic District Design Guidelines.
• OK’d a construction contract extension to Hazelett Concrete Contractors for the city’s annual Sidewalk Improvement Program.