China Grove to raise water, sewer rates

By Shavonne Potts

spotts@salisburypost.com

CHINA GROVE — The town board debated for sometime Tuesday about implementing a new sewer and water rate, which, if raised, would bring in just enough to balance those budgets.

The meeting was the the last in a sequence of budget sessions and the board expects a public hearing in two weeks followed by final approval of the 2010-2011 budget.

The current rate for water is $8 per 1,000 gallons and $9.50 per 1,000 gallons for sewer. Last year's sewer rate went up from $9 to $9.50, while the water rate remained the same.

The town staff came up with three options the board could consider concerning the water and sewer rates.

The options would mostly affect the people who use the least.

The idea was to increase the minimum number of gallons a person uses from 1,000 to 2,000 gallons. There is an average of 773 people who use less than 1,000 gallons. If the town increases that minimum to 2,000 gallons that would mean one-third of the users — 461 people — would pay more with an increase in the minimum amount they consume.

The board reluctantly chose the first option, opting to double the minimum usage from 1,000 to 2,000 gallons. The water rate would go from $8 to $9 and the sewer rate would increase from $9.50 to $10.20.

Town staff originally proposed a sewer rate of $10, but it was determined that adding 20 cents would bring the town over their $13,000 shortfall.

Councilmen Lee Withers, Charles Seaford and Mike Upright voted in favor of the first option.

Councilmen Brandon Linn and Ron Overcash said they could not fathom hitting the minimum users.

"We gripe and complain about Salisbury-Rowan Utilities...we are the same as Salisbury," Overcash said.

He said he did not agree with telling someone they would be charged for using 2,000 gallons even if they didn't actually use that much.

China Grove receives water from Salisbury-Rowan Utilities. At the time the town entered into the contract with Salisbury it used more water than it does now, but it's still billed the original amount.

Overcash and Linn were in agreement with the second option the town staff proposed, which was to keep the minimum usage at 1,000 gallons and set the water rate at $9.75 and the sewer $10.75. The second option would've generated $14,000 in revenue, but historically has not worked well.

Councilman Withers has said when the town has gone up on its minimum rates in the past, all of those customers just decreased the amount of water they used, resulting in a loss for the town, which in this case would be an average loss of 12 percent or about $106,000.

"None of us want to do it, but we have to do it," Withers said.

Town Manager Bill Pless said either way those minimum users will have to pay now or in the next budget year.

"It's not a favorable situation, but hopefully it will position the town in a better position next year," Bringle said.

Right, wrong or indifferent, it's a difficult decision, he said.

"Next year will be more difficult," Bringle said.

The board decided to continue with the proposed property tax increase discussed during last week's meeting. The town will increase the current 38 cents tax rate to 43 cents per $100 of assessed value, the highest it's been in at least six years.

Even with the tax increase and water/sewer increases, the town still will have to borrow from the fund balance, which is the town's cash reserves, to balance the budget.

Prior to the budget session, the board held it's regular meeting.

The board:

- Approved to award a bid of $212,109.54 to B.R.S. Inc., a Richfield company for sewer line extension to Altec Industries.

Some of the highest bids were around $275,000, Pless said.

Altec is a Birmingham, Ala. company that manufactures equipment for utility companies. It bought property adjacent to Hitachi. This project has been ongoing since late 2008.

- Approved to return Tatum Street back to a two-way street. The change would only affect a few businesses, including a hair salon and should be changed by July.

The board will have a public hearing at 6 p.m. June 15.