TAHLEQUAH — Customers of Tahlequah Public Works Authority will see the first phases of rate increases during the first billing cycle in July.

Board members on Friday approved rate increases for both water and sewer services.

For the water service, residential customers within the city limits will pay a base rate of $3.60 per month, while those outside the city will pay a base rate of $4.20 per month. Customers will pay $2.50 per 1,000 gallons of water used.

The second phase of the water-rate increase will be effective next spring, and will increase the cost of water per-thousand gallons to $2.90.

Board member Herb Rozell reiterated the increase is to offset the cost of operating and maintaining the authority’s system, and to try to at least break even instead of lose money.

“That’s the spirit of it,” said General Manager Mark Chesney.

Board member Isabel Baker agreed, and said it will keep the electric department’s revenue from having to make up for the loss of revenue in the water department.

The second phase of the water-rate increase is set for next year, when the authority will begin to pay off a loan for the new plant facilities at Wild Cat Point in the Keys area. The rate change is expected to result in several hundred-thousand dollars in retained revenue each year.



Debating a sewer-rate increase

Board members debated over how to implement a sewer-rate increase, and ultimately decided for a $10 monthly base charge, and a $3.50 fee for every 1,000 gallons of water used. Next year, the usage fee will increase to $4.50 per-thousand.

Last month, Chesney was asked to present numbers that would allow for a base charge, and a per-thousand-gallon charge, without having separate rates for those who used more or less than 4,000 gallons per month.

Chesney on Friday said that would mean a base rate of $10 per month, and $4.12 per 1,000 gallons used.

“I have received a few comments about that, and had two or three people say something about this being all at one time,” said Chairman J.D. Carey. “They understood the cost, but the comments I’ve had were [about the rate increases] being all at one time.”

Board member Kelly Ross suggested a four-year plan for a sewer-rate increase, which would start in January 2012, and increase the per-thousand-gallon rate 50 cents each year.

Baker didn’t agree with a four-year plan.

“I think it’s better just to go ahead and do it,” said Baker. “It might be a little painful, but I think they know the economy is terrible.”

Chesney said projections on the proposed sewer rate show retained revenue, each year, of about $77,000, and stressed that while TPWA isn’t a for-profit entity, it has to bring in enough revenue to pay for the cost of its services.

“Rate-making is difficult; we want to minimize the pain,” said Chesney. “If we’re really going to get on top of it, my opinion is, we need to do it now.”

Carey said the authority should try to get the sewer system to a certain level of revenue retention, and pointed out that the net loss from the service could affect TPWA’s ability to borrow money in the future.

“I feel pretty strong we need to do something to stop our bleeding right now,” said Carey.

The two-phase sewer rate increase was approved unanimously, effective during the first billing cycle in July.

The $1 increase, from $3.50 to $4.50 per-thousand, will be effective the first billing cycle in July 2012.



Effects on the average customer

Officials say residential water customers, in the city, average around 3,000 gallons per month. Under the current rates, a customer using 3,000 gallons would pay $10 per month for water service; with the new rates, he or she will pay $11.10, about 11 percent more.

Sewer-service customers use an average of about 6,000 gallons of water per month, according to TPWA estimates. Under current rates, a customer using that amount would pay a monthly bill of $17.50; with the new rates, he or she will pay $31, an increase of about 77 percent. When the per-thousand-gallon fee increases to $4.50 in 2012, he or she will pay $37, or more than twice the current rate.



Feedback on TPWA policy change

Carey asked how the authority’s move to no longer do same-day reconnections has been received by customers.

Officer Manager Gail Dotson said those who’ve been disconnected were “upset,” especially the ones who were disconnected on Friday and went to the office to pay their bill, only to find they wouldn’t be reconnected until Monday.

“We hope it reduces the number of cut-offs in the future,” said Carey.

Baker expressed disappointment in the decision to change the method, and said there should be some exceptions; for instance, those who have medical conditions.

Dotson said TPWA employees are trying to stress to customers that if they go to the utility office before service is cut-off, they can sign a contract that extends the bill and doesn’t cost them additional money.

“We have to look at each situation,” said Dotson.

If the circumstances involve someone with medical conditions, for instance, the authority would go out to do a same-day reconnection.

“Our cut-offs have been so huge,” said Dotson. “We see the same people cut off every month.”



Carey’s term ends

Board members also bid farewell to Carey, who presided over his last meeting on the TPWA board. Carey could not be re-appointed because of term limits, according to officials.

“Besides being a good citizen, you’ve been a good friend, and I just really appreciate your insight and professional background,” said Chesney, who praised Carey’s commitment to the community. “You’ve been a big, big help to us.”

Carey said he feels a sort of ownership in the authority, and that he enjoyed his time on the board.

“I want you to know, I appreciate everything you do,” said Rozell. “Your heart’s in the right place; you’re concerned about the people. I appreciate that, and we’ll miss you.”