The Bremen Town Council members are considering an increase in water and sewer rates.
Jeff Rowe from Baker Tilly prepared a year-end financial management report for both utilities and presented it to the Bremen Town Council during their meeting last week.
The water utility report showed an increase in cash to $1.6 million. The required minimum cash reserves on hand should be about $900,000. Revenues did exceed the budget by about $200,000. Projections show significant needs in the water utility in the next five years which would spend down the cash. As a result, the projections forecast an increase in rates over the next few years. A 15 percent increase in rates could be phased-in over a few years. Over the course of the phase-in, the water bill would increase from $26.50 to $30.50. Rowe said the rate adjustment could start next year, if that is the direction the council wants to go.
The sewer utility report showed an increase in cash to $1.15 million. The required minimum cash reserves on hand should be about $800,000. Revenues did exceed the budget by about $32,000, but did not take into account the bond proceeds. Rowe said projections show a significant spend down in 2023 with the new sewer plant in the Capital Improvement Plan. As a result, the projections forecast an increase in rates over the next few years. Rowe said a rate has not been estimated due to the pending wastewater treatment facility project, but a phase-in process could start this year in anticipation of an increate in rates as a rate increase would be needed due to the construction project. While those percentages have not been calculated, Rowe said the rate increase will be “significant”. He added that rates need to be adopted that would support Debt Service on the new bonds ahead of the loan closing.
Bremen Town Council President Bill Daily suggested getting things started. Rowe said he will work with Town Attorney Anthony Wagner to draft a rate ordinance which could be presented this month for the first reading. A public hearing could be held in May.
