Council moves toward water, sewer, stormwater increases

     Due to the construction of the City of Monticello’s new wastewater treatment facility, the Sixth Street Ditch Project, and other anticipated future projects, the city has to update its capital and user fees to cover such costs to begin the process of building a capital fund for future maintenance projects.

     During the July 6 Monticello City Council meeting, the council approved the first reading of three to increase water and sewer rates for city users.

     PFM Financial gave a presentation to the council during their Feb. 15 meeting. The advisor reviewed various options on how the city could finance the upgrades to the sewer plant to cover the costs.

     Water rates will be kept the same, except for changes to the flat monthly water/sewer equipment fee of $6. This was seen as a small adjustment that will help build a capital fund for future improvements.

     The first 1,000 gallons used per month will still be a minimum of $6.17. The second to the ninth 1,000 gallons used per month will cost $4 per 1,000 gallons. The 10^th through infinity 1,000 gallons thereafter will be $4.13 per 1,000 gallons.

     The council eliminated the current sewer fee of 150 percent of the water fee. This creates a separate charge based on consumption and not water usage. The new fees are based on recommendations from PFM Financial.

     For the first 1,000 gallons, the current rate was $9.25. The new rate will be $18.98. For 1,001 to 9,999 gallons, the current rate was $6. The new rate will be $12.30. For 10,000 gallons-plus, the current rate was $6.20. The new rate will be $12.71.

     During a city council work session in June, it was the consensus of the council to update the city’s stormwater utility fee, rather than ask for special assessments, to pay for the Sixth Street Ditch Project and other future stormwater improvements.

     The current $1 per month fee for residential units and $2.50 for non-residential units increases to $3 and $4.50 respectively. This is an adjustment across-the-board of $2 per unit, whether residential, commercial, or industrial.

     All fee changes will take effect Sept. 1, 2021. The water fee changes will start appearing on water bills at the end of October, payable in November.

     “The big hit is the sewer rates, which essentially double,” noted City Administrator Russ Farnum, “to have sufficient revenue for the sewer project per the DNR.”

     Farnum warned some additional tweaking may be applied later down the road, whether that’s an increase or decrease.

     “If we get the grant money, we may be able to lower it,” continued Farnum. “If we get good bond rates and grants.”

     Farnum figured the city is about a year and a half away from starting construction of the sewer plant and getting the bonds out into the marketplace.

     “I don’t see why we can’t trim it a bit,” asked Council member Dave Goedken.

     Farnum asked whether the council wanted to increase water/sewer rates or property taxes.

     “We need a dedicated user fund,” he said. “I know this is a big hit for the community.”

     “Can we hold off on starting the project to get rates down?” asked Goedken.

     “It needs to be a user fee,” said Council member Tom Yeoman. “People who use it need to pay for it.”

     Council member Brenda Hanken reminded the council that there are people living on a fixed income who maybe cannot afford the rate increases.

     “$20,000 a year, this will cut them pretty short,” she said. “They won’t be able to even live in town.”

     “It has to be paid for,” added Yeoman. “It doesn’t make a difference how we pay for it; everyone will end up paying for it whether you’re on a fixed income or not.”

     Wayne Peach, who is a city resident, felt this was a reasonable approach by the council.

     “It has to be done,” said Goedken. “We waited too long to do it in increments. We need to rip the Band-Aid off and start to build our revenue.

     “It’s our fault we didn’t plan ahead,” said Council member Scott Brighton, who felt it was also probably too late to split up the increase over a two-year period.