COLUMBIA CITY — With some of the lowest water rates in the state, Columbia City’s Common Council will be considering a rate increase to mitigate upcoming expenses for projects in a fund that is only slightly breaking even.
The council heard from Otto Krohn last week, who analyzed the city’s water utility rate.
“The water utility has low working capital,” Krohn said. “There’s not a whole lot to work with.”
Krohn is proposing a 25% water rate increase. Though the percentage sounds lofty, the average user, who uses 4,000 gallons per month, would see a $5.76 per month increase to their $21.54 bill.
“Those rates are some of the lowest in the state,” Krohn said. “Water is one of the essential public services and it is essential to the public health and welfare of the community.”
It has been seven years since the water rates have been touched.
“When you look at inflation, that’s basically just an inflationary adjustment,” Krohn said.
The water utility fund is supposed to have enough money to cover at least 60 days of operations, preferably six months. Columbia City’s account, however, is nowhere near that mark.
In addition, there are several projects coming down the pipe. The city has an expensive repair need for Well 8.
“That needs to be done immediately,” Krohn said.
There are several other projects planned for the next two to three years.
“You have a little over $600,000 in projects we need to address,” Krohn said. “We need to build up the working capital in the operating fund.”
Some of those projects include three variable frequency drives, which help match the demand for water with how fast it’s pumping out of the plant, and $80,000 filters, which need to be replaced according to the Indiana Department of Environmental Management.
“I think we really need to start thinking through this,” Mayor Ryan Daniel said. “If we had a major water main break, we would be in trouble financially. Nobody ever wants to raise utility rates, certainly that’s money out of our pockets as much as the residents, but we need to take a look at it in the next month or two and figure out a path forward.”
Also at the council meeting, Chip Hill was introduced as the city’s new Community Development Director. Hill comes from 22 years of experience in Pierceton with water, sewer, parks and town management.
“This opportunity came up and I was excited about it. I hope to help Columbia City grow,” Hill said.