Edgerton recently voted to increase billable sewer rates from $2 to $3.29 per gallon, based on a rate study with an independent consultant.
The increase should not affect Gardner customers, according to Gonzalo Garcia, utility director.
In the March 2017 settlement agreement with Gardner, the cities agreed to use Raftelis Financial Consultants as an independent rate consultant to conduct a wholesale sewer rate study. In Sept. 2016, the Edgerton council had threatened to sue Gardner over a disputed sewer bill of about $80,000. After negotiations, the rate of $2 per 1,000 gallons was set until the study was complete.
Garcia said the new rate was higher than anticipated by Gardner officials.
“The city received a bill for October with the new rate on Nov. 9, 2017,” said Garcia. “We were expecting a rate of around $2.31 per 1000 gallons.” City staff has reviewed the rate study done by Edgerton and has requested additional information, he said.
The wholesale rate study has now been completed. The report from Raftelis recommends increasing the wholesale sewer rate to $3.29 per 1,000 gallons.
The report concludes that overall billable flows are 64 percent lower than what was projected 5 years ago in the Springstead report.
Volume from the intermodal facility are 90 percent less than what was previously projected. Flow from the city of Gardner is 59 percent less than was projected.
The lower the billable flow, the less gallons there are to spread operating costs across, resulting in a higher rate.
“The original Springstead was based on all guesses. This is based off real data that we’ve collected, so this is more accurate by far,” Don Roberts, Edgerton mayor, said during a recent Edgerton city council meeting.
“All of the expenditures were a guess in 2012. These are based on actual expenditures – what is the chemical cost, what is the actual electric cost, what is the staffing cost. These are the three largest categories of costs associated with that,” added Beth Linn, city administrator.
Ron Conus, council member, asked how long this determines the rate.
Roberts said it would stay until the city did another study and that council would determine when that would be.
“I would recommend yearly, to keep the rates where they should be,” said Roberts.