City water, sewer rates are sure to increase to fund future needs

Residential and commercial users of the city’s water and sewer systems are sure to see a rate increase in the future. Exactly how much and when hikes might be put in place are still to be determined, but there’s little question they are coming.
Utilities Director Jim Bierd and Randy Brock, operations director in the utilities division, have worked long and hard in putting together a list of 81 items included in a 10-year plan on capital needs for water and sewer. The estimated costs of those projects total more than $55 million.
City commissioners and City Manager Brian McDougal think the public needs to be educated about the projects and the scope of financing, how all of it will impact citizens and businesses, before the increases are implemented.
And most likely those customers who use the most water will pay the steepest increases.
Bierd and Brock are to be commended for their efforts, and they drew praise from Mayor Linda Peterson and the other six city commissioners during a special meeting Monday evening. Commissioners spent about three hours during Monday afternoon’s heat touring water and sewer facilities in the community, then gathered at city hall in the evening to hear John Wolf, of Oklahoma Municipal Financing, who presented a detailed report on a water rate study.
Commissioners authorized the study a little over a year ago.
Although McDougal has been on the job nearly five months, he pointed out the city’s water and sewer infrastructure has needed attention for some time. He said city staff “has looked at our needs over a 10-year period.”
He told commissioners “we don’t need to do them all now, but the list is for over a 10-year span.”
Rick Smith, who is part of Wolf’s team, called the study and plan “a good road map for the city to follow.”
Wolf noted his firm was engaged to determine the rates necessary to operate the city’s water and sewer system in the future.
“We looked at the last four fiscal years, not including the present one which ends June 30,” Wolfe said. He indicated the rates are based on a 10-year projection,
He advised the commission, “You can’t accomplish this on a pay-as-you go basis,” mentioning the projects being identified, adding “and there are several big ticket items.”
Wolfe said that future increases in water and sewer rates should be geared on usage. “They should increase more for the more water used, because those parties place a greater burden on the system. They should pay more,” he said.
“We’re looking at significant cash outlays, $55 million worth of infrastructure, and the quicker the projects are done, the cheaper the cost will be,” he predicted.
Wolf said the Oklahoma Water Resources Board’s revolving loan fund program may be the most feasible way to fund the projects. “We’ve showed how these projects can be funded,” he explained, referring to the water rate study he was discussing.
He said the city would pay interest only while the projects were under construction, then once completed, would begin paying principal and interest.
It was emphasized “we have to show our ability to pay back the debt. Any lender has to have a comfort level that the debt will be paid back.”
But Wolf also warned “you can’t put all of the burden on the commercial customers.”
Peterson noted, “We haven’t had a long range capital projects plan with a debt payment plan before now, addressing infrastructure needs with a timeline. This is an attempt to be realistic.”
City Commissioner James Harrod said as far as he was concerned the two top priorities were the 30-inch raw water line from Shawnee Twin Lakes to the treatment plant and the Atoka water line tying into the city’s line. “I’d like to see us move forward on some of these projects,” he said.
Cost of the raw water line is estimated at $13.5 million and the city has applied for a $2 million grant from the OWRB to help with it. Cost of the Atoka line is listed at $7 million.
Peterson quipped “it’s time to do it, the raw water line.” And Harrod said he agreed.
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This is another reminder from Gordona Rowell, executive director of the Shawnee Conventions and Visitor’s Bureau, about the deadline for supplying coupons, fliers and goodies for the International Finals Youth Rodeo packets is Friday.
She says items should be dropped at the Heart of Oklahoma Exposition Center office between 8 a.m. and 5 p.m. today through Friday and that 1,100 bags will be prepared.
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