Water Rate Hike Approved

September 25, 2019

 

It’s official: Water rates will go up in Dade County as of the next billing period. The Dade Water Authority board of directors approved the hike, proposed in August, at its regular September meeting Tuesday evening.

 

Water board members stressed that the rate increase applies only to the base rate for residential customers—that is, to the charge for the first 2000 gallons. In most cases, they said, the 25 percent will equate to about $3-4 more on the monthly bill, but some may go up a bit more. This is because customers further away from the main already pay slightly more to cover the greater pumping charges.

 

“Our base rate is too low, compared to everybody out there,” said Jeff Pendergrass, the new manager the board hired to replace longtime manager Doug Anderton this summer. Pendergrass had proposed the hike last month, along with a 3 percent annual bump to keep up with inflation.

 

The vote in favor of the hike was unanimous. “As long as it’s been since we’ve had a rate increase, I think 25 percent on the base is a reasonable increase,” said board member H.A. McKaig. Researching its records, the water company could not find a rate hike in the last 20 years.

 

“I think it’s a good proposal, and I think the 25 percent is fair,” said Chairman Eddie Cantrell.

 

But the board balked at Pendergrass’s proposed automatic yearly increase, agreeing instead to look at rates again each July.  “After we’ve had this increase for five or six months, we’ll have a better idea,” said McKaig.

 

Pendergrass said the rate hike is projected to raise gross revenues $28,230.83 a month. Assistant water company manager Sherri Walker said that would put the company’s asset-to-debt ratio at 1.32. “That would give us a cushion for several years,” she said.

 

Ms. Walker had previously reported the debt ratio was currently 1.09, slightly below the required level to comply with the water company’s loan and bond covenants. Dr. Billy Pullen, explaining why he thought the rate hike was necessary, said: “If we get below that 1.1, someone’s going to come in and run the water company.”

 

 

Another point of interest at the Sept. 24 meeting was the ongoing matter of what to do with a sewage treatment plant in Walker County the Dade Water Authority never meant to own in the first place.   “There is a potential buyer,” Chairman Cantrell told the board.

 

A previous developer of the golf community (above) now known as The McLemore, previously known as Tauqueta Falls and then Canyon Ridge, had persuaded a previous avatar of the water board (circa 2003) to partner with him for official purposes on a sewer plant for the embryonic development. Then, when the developer went belly-up after the housing market crash of 2009, Dade County inherited it and has been operating it at a considerable loss ever since. Pendergrass had earlier in the year suggested gifting it gratis to the current developer, with Walker County the responsible local government, but a subcommittee of the board has since been looking for a better deal.

 

What’s on the table now? Cantrell didn’t hint, but he called a special meeting at 7:30 p.m. on Oct. 7 to discuss the proposal. He specified the meeting would be held in executive session, which is to say behind closed doors.

 

In other business, the board agreed to present its plan to fix the problem of a long-useless fire hydrant in West Brow to the Dade County Commission at Thursday’s pan-local-government meeting. At issue is whether or not SPLOST (special purpose local option sales tax) funds allocated to the Water Authority may be used to pay for the project, which entails boring under pavement to lay a new water line for the hydrant. Water Authority employees had thought it qualified for SPLOST but the board had since learned from County Clerk Don Townsend the blessing of the commission was needed. Coincidentally the first pan-government meeting—county and city commissions, school board, water board and economic development—was scheduled in two days’ time.

 

 

Manager Pendergrass updated the board on the $600,000 in improvements he recommended and the board has approved to the Authority’s water treatment plant (left). Most of these seemed in the earliest stages. Pendergrass and the board also discussed the idea he’d previously put forth of a new, larger water line up Lookout Mountain, which would benefit Walker as well as Dade water customers including those at the McLemore development. “We’re at about the hydraulic limit of what we can push,” said Pendergrass. He said the project would cost between $2.8 and 4.5 million depending on whether a pump station halfway up was included.

 

H.A. McKaig suggested seeing to the sweeping water plant needs before going on to new projects. “My suggestion is that we get those things near completion before we talk about starting something else,” he said.

 

But Pendergrass also had a list of 87 deficiencies he’d been ordered by the Georgia Environmental Protection Division to fix. He stressed, though, that many were minor or already covered in his larger list.

 

Assistant manager Walker proposed increasing the leak insurance the water company offers to customers. Currently it costs around $1 and covers $500 of leakage cost. Now, she said, the vendor has offered to double it to $1000 for another 90 cents. She explained that the leak insurance is automatically included in ratepayers’ bills but that they have the right to opt out of the plan. She said that 111 customers who didn’t have the leak insurance, but who had had leaks, had ended up paying an average of $600 apiece. "For 90 more cents, for me it’s a no-brainer,” she said.

 

She also suggested raising the tap fee, or fee for new users. But both these changes she suggested the board take a month to consider and take back up in October.

 

The water board meets at 6:30 p.m. on the fourth Tuesday of the month in the Dade Administrative Building. That makes the next regular meeting on Oct. 22—though, again, the board will before that have a special called meeting on the 7th in reference to the McLemore sewer deal.

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