WILLIAMSON – At special meetings held Thursday for the Williamson Utility Board and Williamson City Council, members voted to approve a new rate agreement with the Mountain Water District, as well as adjusted water and sewer rates.
Representatives for the City of Williamson have been in negotiations to determine a rate agreement after the Public Service Commission (PSC) Staff recommended rates were determined by the city to be insufficient to cover operating costs, maintain a working cash reserve required by Senate Bill 234 and pay the debt owed to Veolia.
At an evidentiary hearing held March 14, it was determined that all involved parties were in approval of the proposed rate settlements. The involved parties include: The city of Williamson, the Mountain Water District, the Mingo County Public Service District (PSD) as well as the PSC. However, the agreements could not go into effect until all involved boards and councils formally approved the rate agreements.
Robert Rodecker serves as the Attorney for the Williamson Utility Board. Rodecker was in attendance at both meetings to explain the proposed agreements to the utility board and council. The agreements will impact the Mountain Water District water rates, and current water and sewer rates.
Rodecker first explained the proposed revised resale rate agreement with the Mountain Water District. “That rate has historically been $1.31 per thousand gallons since 1982.The Mingo County Public Service District is also a customer and they were paying a substantially higher rate. They are one of the parties that protested the rate ordinance because of the discriminatory nature of the rate to Mountain Water District. The Mountain Water District rate that the Staff of the PSD recommended was $1.93. The Mountain Water District has two alternative sources of water supply which include the production of water on their own part and the purchase of water from the City of Pikeville. They purchase water from the City of Pikeville for $1.68 per thousand gallons… We have been in discussions with the Mountain Water District to address the issue of the rate and the volume of water that they would purchase… The City and utility board faced the loss of their largest customer. With that in mind, we met with all the parties to the proceeding… The parties negotiated what appears to be a viable recommendation that we want to put forth today…”
Rodecker explained that the Mountain Water District also agreed to purchase 22 and half million gallons of water per month as long as Appalachian Regional Hospital (ARH) remained a customer of the Mountain Water District. Following Rodecker’s explanation, the utility board and council voted separately to approve the Amended Water Purchase Contract Agreement with the Mountain Water District.
The utility board and council also approved separate joint stipulation agreements for the settlement of water rates and sewer rates. The adjusted water and sewer rates will occur in three steps.
A document was provided by Rodecker that demonstrated what the total average monthly bill would be for customers under the new rates. The total includes both the water and sewer amounts that are shown on a typical monthly bill.
A minimum usage customer that uses 3,000 gallons per month currently pays a total bill of about $54.00. Under step one of the rate agreement, the total bill for minimum usage customers will be $53.50 per month. When step two rates are implemented the minimum usage customer will pay $51.09. When step three is implemented the average bill for a minimum usage customer will be $44.32.
For the average customer using 4,500 gallons per month, the current total bill is $77 per month. Non metered customers are also charged at the 4,500 gallons per month rate as well. During step one the average customer will pay $76.50 per month. When step two is implemented, the average customer will pay $73.04 per month. The total bill when step three is implemented will be $63.32 per month for the average customer.
Larger households using 10,000 gallons per month are currently paying a total bill of $154 per month. During step one of the rate agreement, larger households would pay $152.38. When step two is implemented, larger households will pay $145.58 per month. When step three is implemented, larger households will pay $126.36 per month.
The rates will not be implemented until all associated boards and councils approve the agreements. Although the utility board and the council approved the rate agreements, the PSD and Mountain Water District will also have to formally approve the agreements.
Rodecker also explained that there is one other aspect that the board and council needed to comply with per PSC recommendation. “There is one other aspect to this that I will explain. The PSC requires that the amount to pay Veolia for both the current bill and the arrearage will be set aside and put in an escrow account at a local bank. They have determined the percentages to be set aside for current monthly payments and the portion that goes to the arrearage. I recommend that the board approve this stipulation for both the water and sewer and approve the revised Mountain Water District,” Rodecker stated.
The percentages determined to be set aside as determined by the PSC were explained by Rodecker. 10 percent of revenue will be used to pay the arrearage to Veolia, 60 percent will be used to pay the current Veolia bill and will be put in a sub account. The utility board will use the remaining 30 percent for operating cost.
(Courtney Pigman is a news reporter for the Williamson Daily News. She can be contacted at [email protected], or at 304-235-4242 ext. 2279.)