The Dexter Leader
A Heritage Newspaper
Weekly Publication
Village seeks comment on water, sewer and trash rates
By Sean Dalton, Staff Writer
PUBLISHED: June 5, 2008
Residents are being invited to the Dexter Senior Center at 7:30 p.m. Monday to question the Dexter Village Council about raising water, sewer and refuse rates that officials predict will in turn raise questions in the community.
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"I encourage citizens to come out when there is an issue that concerns them," said Village President Shawn Keough.
He explained that the proposed rate increases come after years of being subsidized by the village's general fund.
The proposals on the table include a 5 percent across-the-board increase in water rates, a 3 percent increase to sewer and a flat $2 monthly increase for refuse services.
As it stands, the monthly village service fee for water is $5.85, the first meter per 1,000 gallons rate is $2.64 and the second meter fee is $3.55.
Those outside of the village's service area pay $3.70. Those rates would become $6.14, $2.77, $3.74 and $3.88, respectively, if the council passes the proposed rates after the public hearing.
The monthly sewer service fee would rise from $5.15 to $5.31, the per-1,000 gallon fee would increase from $6.34 to $6.53 and the outside village fee per 1,000 gallons would go up from $8.88 to $9.14 - or 3 percent across the board.
There are currently 2,000 meters in the village and 1,500 sewer connections, according to village officials.
The refuse monthly fee will increase from $13 per month to $15.
In the case of the refuse rate, the village could not find any record of any increase in the village's records "as far as (the village) can go back," according to Keough.
"Municipal taxes have been subsidizing a portion of it," he said. "Even with these increases the general fund is still subsidizing $45,000 of the refuse operation.
"We could have raised the refuse rate even more and then there would be no subsidizing, but we decided to keep some of it."
On the water and sewer side of the village's utility service, rates have gone largely unchanged since 2004, despite increases in operational costs and other fees for equipment replacement and upgrades.
The monthly service fee for water remained flat at $4.03, as did the per 1,000 gallon $1.69 fee years prior to the 2004 increase. Sewer fees had remained at $1.25 for the service fee and $4.39 per 1,000 gallons over the same period.
"We've really done a pretty good job with the modest increases we've had generating the revenue from the water rates that we need to cover our operating expenses," Keough said. "It's still a good deal."
Keough explained that the Local Development Finance Authority once helped a great deal with utility services provided by the village.
Dexter - the first in Michigan to establish an LDFA - disbanded the authority in 2006 after it cleared all of its debts in 2003.
While it was in effect, the money brought in from capture of incremental tax base increases at the industrial park at Bishop Circle paid for various improvements around the village, including the construction of a 500,000 gallon capacity water tower and contribution of $2.1 million towards upgrades to the village's water and sewer plant. It amounted to a $175,000 subsidy per year, according to Keough.
The water and sewer funds are both enterprise funds, which means that service fees collected are meant to cover operations and maintenance without assistance from other accounts, such as the general fund.
"Even with these rate increases we're still counting on water and sewer connection fees to help us fund capital improvement projects and with little development occurring the expectation is that we will not get a huge windfall from connection fees," Keough said.
"If additional infrastructure improvements are required to maintain the system that is why we need modest fee increases to help us maintain our operating expenditures."
He predicts that fees will continue to rise at the current rate as the village predicts slight yearly increases to water services in the future, and the increases are making up for the many years that rates remained flat.
"Even though we've had a lot more users on the system, we need to keep up with things in those years where we didn't raise rates even by a modest amount, which made us fall behind more and more."
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