By Martin Couch
Central Arkansas Water is going up on its rates by eight percent and the City of Bryant will have to follow suit with the same increase to residents to accommodate it.
"I've looked at the numbers and there is no reason to increase[more] the rates other than for covert operative costs," said City finance director Gary Hollis.
The rate increase would be seen only on the water portion of residents monthly water/wastewater bill.
"It would have the impact on the average water bill of about 72 cents a month or a 3.33 percent increase," Hollis said. "The average household uses from 6,000 to 10,000 gallons of water a month."
The water rate would be effective by June 1, 2011.
"The eight percent would be decreasing since the ordinance for 2009 for 16 percent," Hollis said.
It would be a 3.33 percent overall increase in water, with sewer not being affected.
"We were at three percent and went to nine percent and back down to three, now we're back to six, why do we need to do it?" asked alderman Steve Gladden.
The increase would pass through from CAW raising water rates and the city is covering the tax as the reason for the increase.
"Do we know if we have it covered in our other fee already?" Gladden asked. "We dropped it once, because we felt we didn't need that money. Dropped it from nine to three and now bring it up again."
The numbers would be "at zero if it wasn't for CAW, I think," Mayor Larry Mitchell added.
Hollis offered an explanation for Gladden and the other aldermen.
"Going through the numbers, if we look at the end of 2009 we had about $17,000 water excess fund excluding a half-million dollars, taking debt service out and prepaying all engineer costs, evaluation costs, and fees that were prepaid earlier, we should have about a million dollars in the water funds at the end of the year to start out with," Hollis said. "With the eight percent, there is going to be other increases and expenses which is naturally going to happen. Costs are going to have to rise slightly and we anticipate getting reimbursed by the Arkansas Natural Resources commission for our engineering fees. We are preparing sewer system evaluations and the aeration project is in the plan funding at $325,000 this year. Next year, $175,000 could be reimbursed from the commission and that would mean $700,000 next year would be passed through coming back in.
"It flows so we are continuing to maintain an average balance without having to fund the extra debt service that is coming from the Arkansas Natural Resources bonds," he continued. "It is not actually that it be safe to say the first quarter of 2015 starting debt service on this one and no later than that."