Common council to discuss water, sewer rate increase

The Merrill Common Council is expected to discuss an increase of the city water and sewer rates at its next regular meeting next Tuesday at City Hall starting at 7 p.m.

The last full increase on water rates was in 2003. The consultant’s recommendation was for an 8.6% increase to be effective in early 2011. After considerable deliberation, the council recommended a rate increase of 14%. The impact on the typical residential customer would be an increase of $7.69 per quarter. With this increase, Merrill’s water rates will be lower than the average for all Wisconsin Class C water utilities, and lower than the average present rates of 30 comparable communities.

The last rate study for the sanitary sewer utility was done in 1995. Since then only three rate increases were made. A decline in sewer usage increases in capital replacement needs and limited rate increases over the past 15 years resulted in a recommended rate increase by the consultant of 41.5%. He further recommended that the city should consider increasing rates by a couple percent each year to keep up with inflation. After deliberation by the common council, a recommendation was forwarded to the Oct. 12 council meeting to include a rate increase of 41.5% and a 2% rate increase for each year thereafter for 5 years. The impact to the average home owner will be an increase of $20.81 per quarter which is below the average present rates of 36 comparable communities.

A portion of the city of Merrill’s tax collection is paid to the water utility each year to reimburse the utility for the cost of maintaining and installing the hydrant system in the city. This is known as the Public Fire Protection fee. This amount, totaling over $250,000 a year is necesssary to keep a system in place that is capable of rapidly delivering a large amount of water to a fire anywhere in the city’s water service area. Last year the city council voted to move a portion of this charge directly to the water bill. Among other advantages, this allowed the city to begin collecting a part of this fee from tax exempt properties that still pay water and sewer bills. This also freed up money in the general fund tax collection to be used for other general fund expenses. As a part of the consultant’s recommendations, it was suggested that the remaining $220,988 a year be moved over to the water and sewer bills gradually over the next four years. The city council is considering transitioning just half of that total over the same period of time. The impact to the typical residential customer would be an increase of $5.40 per quarter over the 4-year transition.

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