Council OKs three of four rate increases

After listening to the concerns of a half-dozen residents about proposed increases in city utility fees, the Hillsboro City Council tabled an ordinance that would raise the base rate for sewer service by $8.70 a month in order to pay off a bond more quickly.

But the council did approve ordinances to increase the monthly base rate for electrical service by $4 (to $9), the water rate by $1 (to $28.06) and the recycling fee by 5 cents (to $1.90).

The new rates will affect consumers in January 2010.

Residents who spoke at the meeting expressed their concern about fee increases in light of the current economy, the number of residents on fixed incomes and the likelihood of new tax assessments coming from the county to construct and operate a new county jail.

?I think you?re forcing people out of Hillsboro,? said Ron Brown of 115 Floral Drive.

Dave Wiebert, who owns several rentals in Hillsboro, said renters are already having trouble paying rent, and the increases will only make matters worse. The rate increase assessed to a landlord ?has to be passed on to someone,? he said.

The impact of all four of the proposed ordinances would have been $164 a year per household. The three ordinances the council approved will result in an annual increase of only $60.60 per household.

The council had agreed in summer to increase the electric and water fees as an alternative to increasing the mill levy in order to fund the 2010 budget.

?We spent days to come up with a budget,? Mayor Delores Dalke said. ?We?ve got new bills for water and sewer plants that we were required (by the state) to build.?

The 5-cent increase for recycling, meanwhile, simply passed on the increase charged to the city by McPherson Area Solid Waste, which picks up the materials from the city?s volunteer-run recycling center.

At one point Councilor Byron McCarty asked the residents in attendance if they preferred an increase in utility fees or an increase in property taxes.

Resident Gari-Anne Patzwold said she leaned toward a property-tax increase, saying it isn?t ?fair? but ?probably just? because property owners are more likely to have the financial means to cover the expense.

Paine said the increases for electric, water and recycling were necessary for the budget, but ?the council really has options? in regard to the fee for sewer service.

Revenue generated by the proposed $8.70 monthly increase for sewer would have been applied to the payments on the bond the city used to pay for new wastewater lagoons and accompanying upgrades to the system.

Increasing payments by the amount generated by the new fee would have reduced the life of the bond from 40 years to 21 years and saved the city more than $2.75 million in interest.

City Administrator Larry Paine said reducing the life of the bond brings it more in line with the lifespan of the sewer system itself, which likely will need to be upgraded before the 40 years is up.

?By paying it off early, we pay for what we use during the period of time that we use it,? Paine said.

Ron Brown said, ?I can see the savings in the long run, but right now we?re in a crunch.?

Brown said with all the increases in fees and taxes looming on the horizon, ?somebody?s not going to get paid.? He predicted more residents will default on utility bills, cut back on doctor visits or spend less money at the grocery store.

Council members McCarty and Shelby Dirks affirmed the long-range economic sense of proceeding with the sewer fee increase, but wondered if action could be delayed for a couple of months to see how the county?s jail project might develop.

When Councilor Bob Watson went ahead with a motion to approve the ordinance, it died for lack of a second. The issue was tabled for an indefinite time.

Mayor Delores Dalke said, ?It is sad that we are making our decisions for the city based on what another unit of government is doing. The county is the one building a jail, we?re not.?

Dalke said the city of Hillsboro has ?always done a good job? of taking care of its own business without raising the mill levy?unlike the county.

Other business

In other business, the council:

n approved the purchase of a bypass pump to move wastewater around the lift station during repair situations and power outages. The pump will cost $30,650?a discount off the asking price of $50,495 from the provider.

n authorized Paine to sign a lease agreement with USD 410 to rent for an annual fee of $180 three acres adjacent to the public works yard on North Adams as a place for residents to dump their yard waste.

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