RBC board foresees rate increase

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 By Donna Thornton/News Editor

News of a Gadsden Water Works and Sewer Board bond issue that will require a rate increase for customers will have a trickle down effect with one of the board’s largest customers – the Utilities Board of the City of Rainbow City.

The rate increase from Gadsden, along with the need for upgrades to Rainbow City’s sewage treatment facility will force the board to increase rates, board Chairman Jerry Tolbert and other members of the board said.

Rainbow City buys about 1 million gallons of water a day from the Gadsden Water Works. As The Gadsden Times reported earlier this week, the entity is implementing increases over a five-year period that will total 45 percent to cover the cost of $38 million bond issue to upgrade Gadsden’s water treatment and sewer treatment plants.

Tolbert said when the rates are compounded, increases to customers will total more than 50 percent. Because Rainbow City is a customer from outside the Gadsden city limits, Tolbert said, it already pays an additional 10 percent surcharge for water.

In addition to the cost of water the system buys from Gadsden, Tolbert and engineer Heath Williamson said Rainbow City faces the need for a new sewer treatment facility of its own.

The board received a warning last year from the Alabama Department of Environmental Management about its treatment facility.

Williamson said the system is built to handle about 740,000 gallons of waste water a day, but now handles about 1million gallons a day.

And  ADEM constraints regarding the water that is put into the Coosa River are becoming more restrictive, he said. The board is working with ADEM to manage the situation, but Williamson said he expects the board to be placed under a consent decree – an agreement that it will work within a specified time frame to meet ADEM regulations.

The combined circumstances mean the RBC board needs a bond issue of its own. Tolbert said the board expects to move forward on a bond issue for $7.5 million, and has asked that the Rainbow City Council help with an equal amount. Mayor Terry John Calhoun said the city would have to agree  and decide how to come up with the money to provide it to the water board.

The new council is not yet in place, he said, and has not considered the issue.

Board members know the customers don’t want to see an increase. Board member Debbie Hiltz said they are all customers of the system, too, and will be paying the same increased rates.

The board has dealt with, and faces more, expensive repairs to the system. From a pipe replacement job that cost about $155,000 to an upgrade in a lift station that cost $100,000, the board has to be able to make such repairs when needed.

Tolbert said when U.S. 411 was four-laned, water pipes were not replaced, and there is concern about water leaks. In one out of five sections of the roadway, that work has been done by the board, at a cost of $100,000. The other sections remain to be done.

Currently the system has an 18 percent water loss ratio – the water lost through leaks and unknown causes, Tolbert said.

To help curb losses and operate more efficiently, the board is mapping its system. Williamson said the maps of the system are something the department uses on a daily basis, and the cost of the mapping project is about $150,000.

These projects and expenses, Tolbert said, have been undertaken to help try to make the system more efficient.

Also the board has reduced staff internally and externally, and switched to a radio-read meter system that is expected to yield a 5-15 percent saving over time. When the water board supervisor retired, Tolbert said, the vacancy was filled from within and a parttime employee was hired for the immediate future.

The board has worked, Tolbert and other members explained, to cut costs as much as it can.

However, to meet the increased cost of buying water from Gadsden and to be able to build a treatment facility that will give the city room for sewer growth in coming years, members said, borrowing money is a necessity.

With interest rates low now, Tolbert said, the board needs to proceed quickly with a bond issue.

As to how much the rate increase will be, board members do not know. The amount of increase needed is being studied, Tolbert said. He said the board would rather do one increase, rather than increasing now and asking for another increase later in the year.

Tolbert said the board wants customers of the Rainbow City Water and Sewer Board to know that the increases are coming, and to know that the board will do what it can to keep the rate increase as low as possible, while acting responsibly for the city’s future.

The board could plan on building a facility that will handle the city’s current capacity at a lower cost, board member Boyd Smart said, but that would give no room for the growth the city hopes to see in coming years.

The planned facility should accommodate city growth for the next 30 years

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