2017-03-30 / Front Page

City Water Prices Will See Increase

To Balance Residential, Commercial Rates
By Erich T. Doerr

City water and sewer rates were raised by the St. Ignace City Council Monday, March 20, with most residential customers seeing an increase of about 45¢ to 50¢ on their water bill and about 20¢ for wastewater service based on an average usage of 3,000 gallons. The flat rate increase will help balance the city’s residential and commercial water and wastewater payments at the request of the United States Department of Agriculture and will allow the city to receive USDA funding for future projects.

“It finally got to the point where we needed to do something,” City Manager Les Therrian told The St. Ignace News.

The council approved an increase to the commodity rate for both residential and business customers with a second increase in the flat readiness-to-serve charge for business customers, designed as a way to balance the payments. The commodity rate increase for water service will be 3% each year for the next three years, then 2% a year for the following four years. In 2017, that means the price of water will increase from $5.39 to $5.55 per 1,000 gallons. The sewer rate’s commodity increase will be 1.5% each year for the same period, from $6.70 to $6.80 for 1,000 gallons. Commercial customers can expect to pay more, depending on the size of their water lines with the readiness to-serve increase. For businesses with a ¾-inch line, the cost will stay at $26 for water but increase from $34.42 to $36.45 for sewer. Those who have a two-inch line will see water increase in cost from $175 to $224 and their sewer cost rise from $196.42 to $253.12. The readiness-to-serve charge for residential customers will remain at $16 a month for water and $20.25 a month for sewer services.

The new rates will allow the city’s water and sewer payments to better reflect who is using it. In 2016 under the old rates, residential customers used 44% of the water, yet paid 51.4% of the cost, while commercial customers used 56% of the water but paid 48.6% of the cost. Under the 2017 rates, residential customers will account for 39.2% of water usage and 48.1% of payments. Commercial use will now account for 60.8% of use and 51.9% of payments. The rate increase is expected to lead to residential customers cutting back and using less water, thus the lower percentage of use, according to Mr. Therrian.

The rates will see similar changes on the wastewater side. Under the old rates in 2016, residents provided 42.7% of the use and contributed 47.7% of the revenue while commercial customers used 57.3% but contributed only 52.3% of the revenue. With the new rates in 2017, residents will use 36.3% and pay 44.7% while commercial customers will use 63.7% and pay 55.3%.

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