Berlin Residents Could See 8% Sewer Rate Hike
BERLIN - A higher special connection fee for Berlin's new wastewater customers is inevitable, as is a rate increase for current sewer customers, whether the treatment plant capacity is expanded or merely improved, ratepayers heard at the Jan. 3 meeting on the project financing.
'Just to increase the capability, not merely the capacity of the existing plant, there needs to be a rate increase,' engineer Mark Prouty, of wastewater consultant URS Corporation, said last week during a special meeting of Berlin's Town Council.
The special connection fee would increase to $14,000 just on nutrient removal enhancements alone, without adding capacity. The fee, which could change as numbers are finalized, would be $18,000 starting July 1 for the expanded capacity if 50 EDUs are hooked up annually. The total cost of the improvements and the expansion is $18.2 million in today's dollars, said Prouty.
Russ Tatman of URS broke the costs down. The additional capacity and better nutrient removal would account for the majority of the cost, at $10 million. A new, year-round spray irrigation system comes in at $5.5 million. Repairs to the existing effluent storage lagoon, contingency and design costs should reach roughly $3 million.
The 8-percent increase in sewer rates for current customers will begin July 1 if approved by the town council after a public hearing, which will generate $133,000 in additional income every year.
The rate increase would cover only the improvements to the plant's nutrient reduction efforts, not the new capacity.
'They shouldn't be paying for growth,' Berlin Mayor Tom Cardinale said.
One thing ratepayers will not be paying for is the design and bidding process.
The finances are not final.
'All these numbers will shake out when we start getting a clear picture of our costs,' Berlin administrative director Linda Bambary said later. 'We'll be revisiting the numbers. We still have a lot of number crunching to do.'
The County Commissioners' decision to reduce the expansion from 1.4 million gpd to 750,000 gpd may benefit the town financially. Hook-up rates in Berlin have slowed down, and the fewer connections there are, the less money comes into town coffers to pay off sewer utility debt.
'There's risk in building a plant when you're not getting connections very fast. It's important for the overall costs to build as close to what you think you need immediately,' Prouty said.
At Thursday night's meeting, citizen Ron Cascio raised the question of special connection fees for in-town properties already paying a ready to serve fee, which reserves sewer capacity for an unbuilt property. Those already paying ready to serve fees will still be subject to the full $18,000 special connection fee, Tatman explained.
'Then they're paying to add capacity they already own,' Cascio said. Those property owners would also be subsidizing growth, he said.
Ready to serve fees guarantee the availability of sewer service for a property, Bambary later explained, and pay for the costs associated with that unused, but available capacity like personnel and electricity.
The ready to serve fee does not confer ownership of capacity, and those properties must already pay the standard connection fee when hooked up, she said.
The connection fee would cover improvements to the plant, not just the expansion.
The proposed new rates and fees will go through public hearings before a final decision on the changes are made.