Berlin Mayor Suggests Delaying Stormwater Rate Increase

Berlin Mayor Suggests Delaying Stormwater Rate Increase
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BERLIN –  Town officials detailed proposed utility rate increases at a work session this week.

At a work session Monday, Berlin’s elected officials met with department heads to review the town’s proposed fiscal year 2020 utility budget as well as the suggested water and sewer rate increases. Though a stormwater fee increase was initially proposed as well, Mayor Gee Williams announced Monday he recommended delaying it. The increase would have doubled the residential rate (bringing it to $100) and would have increased the commercial stormwater rate by 30%.

“Based on comments from the public that all these increases are too much at one time, I’m recommending delaying increases to stormwater utility fees for another year until July 1, 2020,” Williams said.

The town’s electric fund budget is proposed to be $5.3 million in the coming year while the town’s three water fund budgets (water, sewer and stormwater) total $3.8 million. Together, the utility fund budgets are 10 percent lower than they are in the current fiscal year.

Rob Duma of Davis, Bowen & Friedel reviewed proposed water and wastewater increases with the council. Staff recommended the town approve a 5% increase in water rates and a schedule of sewer increases over five years.  Duma said he believed that with the proposed increases, the water and sewer funds would break even after the first year.

“It’s kind of a moving target we’re trying to hit here,” he said.

He stressed, however, that the funds would break even as far as operations and maintenance. There would be no funding for capital projects.

Town Administrator Laura Allen said because the town would likely need funding for capital projects, she was recommending that officials explore using some of the town’s EDU and special connection revenues to help pay for capital projects. Currently, revenues in those categories are used to address debt.

Because the 29% property tax increase being considered by town leaders has been described as a way to gradually restore funding borrowed from the general fund by the water and sewer funds during recent years, Councilman Zack Tyndall asked what would happen if the town simply wrote off that $3 million debt.

“Reserves would go from $3.2 million to $200,000,” Allen said.

Williams said that was just the opposite of what officials were trying to accomplish.

“Right now it’s not truly there?” Tyndall said.

“It’s not cash,” Allen replied.

Williams added the town’s reserves were not made entirely of cash.

“A lot of it is committed but it’s there because we pay it back in installments …,” he said. “There’s no get-around. There’s no ‘well we can do this’ or ‘we can do that.’ I think a lot of communities are at a crossroads. I think the budget I have proposed recognizes that we’re doing the right thing … I can’t imagine this or any council saying the heck with all that we’ll just start letting things go.”

Though the council was presented with both a potential five-year rate increase and a single year rate increase for the water and sewer funds, Williams said he did not support doing the entire increase in one year. The single year rate restructure proposed would result in a 5% increase in water rates and a 20% increase in sewer rates. That would generate an additional $277,820 for the town’s sewer fund and $50,195 for the town’s water fund.

About The Author: Charlene Sharpe

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Charlene Sharpe has been with The Dispatch since 2014. A graduate of Stephen Decatur High School and the University of Richmond, she spent seven years with the Delmarva Media Group before joining the team at The Dispatch.