The first reading of the rate ordinances of the water treatment plant and water treatment plant renovation projects was conducted Tuesday at a Philippi City Council meeting.
Councilmen in attendance included Ed Larry, Barbara Bryan and Davis Lewis. Also in attendance was Mayor Chris Mulneix, City Manager Karen Weaver, City Clerk Tammy Stemple and newly elected Mayor Jerry Mouser, who will soon take over for Mulneix.
"We did have to look at our sewer rates in order for us to file our certificate with the public service commission," Weaver said.
According to Weaver, Griffiths & Associates looked at the city's rates and analyzed the cost. Also, they prepared an ordinance for new rates.
Larry made a motion to approve the first reading of the rate ordinances of the sewer rates as well as the Waste Water Treatment Plant Project and Water Treatment Plant Renovation project. The motion was seconded by Lewis and carried unopposed.
"The proposed rates would not take effect until after this project has reached substantial completion," Weaver said.
The first phase of the project is projected to take place in February of 2014.
"They want to make sure, if we get a loan to do the project that we have the payback already in place," Weaver said.
The payback will occur in two steps, spreading out the proposed rate increase so that it wouldn't occur all at once. The first step would increase the minimum charge for sewer. Currently, that minimum charge is $18.13.
According to Weaver, the first phase would not go into effect until sometime after February 2014 and would raise the minimum to $20.85.
The second step would not take place for about a year after the first step and would bring that minimum up to $26.
"Our rates are broken down per gallons," Weaver said.
Currently, the monthly rate for 4 gallons is set at $7.25 The proposed increase would bring the rate up to $8.35 for 4 gallons.
The current waste water treatment plant the city currently has was built around 1987. Repairs and replacements are needed to maintain it. Some of the construction work would go toward upgrades to the plant. Main components of the plant are outdated and need replaced. Parts for those outdated components are difficult to find and therefore difficult to maintain.
Also, a pipe that pumps waste water into the primary waste water treatment plant has experienced several breaks over the years and needs to be replaced.
"This is one of the things that the city has to take care of," Larry said. "It's not something that's frivolous, it's something that we have to have."
According to Craig Richards, project manager of Burgess & Niple Engineering Firm, both projects are in "various states of design or construction".
Work on the water treatment plant project began in August of 2011.
Improvements in the second phase of the proposed project are estimated at $5 million, based on rough figures put into the long term control plan.
"Now, how you gonna pay for a $5 million project?" Richards said.
The city must meet requirements in order to be eligible for certain grants or loans.
According to Richards, the first step in the rate increase would take the rates up to about 1.86 percent of median household income. The second step in the rate increase will take rates up 2 percent, causing the city to exceed the minimum threshold.
"It opens the doors for other better financing options for future projects," Richards said.
Currently in the Department of Environmental Protection program, if rates go above 1.75 percent of the median household income, the city will be eligible for $1 million in principal forgiveness money.
"What that means is they'll lend you the money, and then forgive the price for it," Richards said.
If the city crosses the 2 percent threshold, it will be eligible for up to $2 million in principal forgiveness money. The Department of Environmental Protection state revolving fund program is subject to change each year.
"Everything is in place," Richards said. "The funding has been committed by the Department of Environmental Protection. The next step is to get the rates approved by city council."
The presentation of the rate ordinance for the first reading is the beginning of the process. The city cannot file with the Public Service Commission until after the first reading. The rates will be available at City Hall and there will be a public hearing on the second reading of the rates.
Contact Melissa Toothman by email at mtoothman@theintermountain.com.
