Water changes afoot
COLUMBIANA- A public hearing Tuesday before City Council to discuss a change to the city’s water rate structure turned into a discussion about all city utility rates – with most residents agreeing they are too high.
The city is looking at a new rate structure to prove to the United States Department of Agriculture (USDA) it has the ability to pay back a 40-year, 2-percent interest loan for a new water treatment plant.
The plant has been in the planning stages since the early 2000s and was last estimated to be completed by 2016. It will replace the existing plant on the south end of town near Metz Road.
Total cost estimates last topped $22 million – up from the roughly $15 million originally estimated, and Mayor Bryan Blakeman said the USDA has since ordered the engineering company to go back to the drawing board to lower the costs.
Arcadis Engineering employees blamed the spike in construction costs on increased manufacturer’s costs for specific equipment.
The city accepted contracting bids for the project at the end of 2013, but rejected all that were submitted since they exceeded the 10 percent threshold of the original estimate.
The project will be rebid once Arcadis provides a new cost estimate, and the city has since hired the Bricker and Eckler law firm to assist with the overall project.
The firm provides legal counsel for manufacturing and construction, among others. When asked, Blakeman said he could not disclose specifically why the firm was hired.
A public hearing during the council meeting showed residents were not in favor of a $21 a month surcharge on their water bills to pay back the USDA loan.
Customers currently pay $6.54 per 1,000 gallons of water.
Jacob Sevek said adding the charge to his bill more than doubles his cost. His most recent bill was $19.62 for three units of water.
“Fortunately for where my wife and I live, we have a septic system and don’t pay (sewer rates),” he added.
In November of 2003 council passed an ordinance to increase sewer rates to $7.43 per 1,000 gallons for customers and the few living outside the city are paying $11.14 per 1,000 gallons.
Finance Director Mike Harold said the rate was increased to pay on a 40-year $7.22 million loan for the sewer plant constructed about 10 years ago. The loan will be paid off by 2045.
Regarding water rates, Sevek said that as a future parent should a $21 fee be necessary to ensure a safe water quality for his children he will pay that fee, although he suggested it have an expiration date.
The fee should be in place for a specific amount of time, he said, with an additional charge on water rates once that expired.
He then told council less talking and more doing on their part is needed.
“Previous councils should be ashamed of themselves, especially those that have been seated for a long time,” he said.
Blakeman replied that previous councils could not get to this stage in the game partly because of stalled federal funding for the project.
“I do agree, past councils should have been doing something small to save up and I think the school should have been doing that to save for the roof. A roof is a couple hundred thousand dollars and our current estimate on this is $22 million,” he said, referring to the Columbiana School District’s project to replace a flat roof over South Side Middle School.
The district has been seeking tax dollars to pay for a new pitched roof, but those efforts failed.
“For years we approached the USDA to try to get grants and loans to pay for the lion’s share. A few years ago they finally came to the table and said they were going to give us the loan money, and it kept going down based on the income of the residents of the city,” Blakeman said of the water plant.
The USDA has awarded a $4 million grant for the project, and a $10.2 million loan, which was originally going to cover the project cost.
Jerry Kurtz of West Salem Street and Bill Syoc of Railroad Street said they can’t afford any additional costs on utility bills.
Kurtz said his monthly water bill for his two-person home is $40.05, his sewer bill is $55.70 and his electric bill is $90.60, and he cannot afford for his water bill to double.
Syoc said his most recent water bill for his four-room, two-person home was $38, and the additional sewer cost put it near $70.
“I don’t see any excuse for a $90 water bill. The electricity is outrageous as far as I’m concerned for a home with two people,” he said.
Dan Woods of West Salem Street suggested the city bring down electric rates to offset the cost of water rates.
He said the electric rates have not always been as high as they are now.
“I’m really all against everybody doing these shenanigans and it needs to end,” he said.
Councilman Dan Bekar said the city is not doing any “shenanigans” but trying to do what is best for the town.
Woods then suggested water customers pay an additional $10 a month over the term of the loan instead of $21.
Blakeman agreed the $21 fee could be reduced, and resident Rob Struharik said the fee does not include the city’s growth.
He said the city will grow “faster than they think,” and referred to a new development planned for the Firestone Farms area.
The development will add more customers to the system, and that could result in lowering costs for everybody involved, he noted.
He also suggested the city look at competition when it comes to rates. He said his North Lima business pays slightly more for water through another company than the city’s current rates.
Lifelong resident Rob Schwartz asked, “At what point do we draw the line and say we can’t do this? What is the contingency plan and does it involve possibilities of outsourcing or privatizing?”
Blakeman said he has not discussed privatizing with anyone, although he would not rule out that possibility. As mayor he would only vote should a tie occur on council, however.
Steven DuBois of Union Avenue said the city should know the exact cost before building customers “into a frenzy” about potential cost increases.
He also said he doesn’t feel it would be fair to institute an across the board fee for all customers, since not all customers are using the same amount of water.
“This year has been one of the worst winters in recent history as far as utilities and people are having a hard time catching up and getting out of it. Right now is not the time to be discussing such a large number to be added to a bill,” he said.
Columbiana resident and school teacher Megan Cowan agreed.
“My husband and I do whatever we can to make choices in our home to bring costs down. I would ask you to consider the option of whatever fees we have to pay are based on usage instead of a flat rate then we can control that bill and still be doing a part,” she said.
Blakeman said raising the rate over instituting the surcharge would ultimately do that, but then it could drive industrial business away.
“It’s a very fine balancing act that we are involved in,” he said.
Homestead Avenue resident David Parker said of the eight communities and three states he has lived in Columbiana has the highest utility cost of all.
“The water rates and sewer rates are really out of line in my estimation,” he said.
He then asked if the city could buy water elsewhere, like Pine Lake.
Councilman Lowell Schloneger recalled that four year ago a citizens’ committee agreed they wanted to remain on the city’s well system, and Blakeman said the city did at one time look into purchasing water though Aqua Ohio. Tapping into that system was last estimated at about $2 million.
Councilman Dick McBane said the oil and gas industry has likely driven that cost up, however.
“All costs are increasing right now,” he said.
Council members were in agreement the $21 fee could be reduced and Schloneger said they are looking into other options.