SYRACUSE - Syracuse Town Council members heard the results of a utility rate study conducted by London Witte Group at Tuesday evening’s meeting and afterwards gave the financial advisor the go-ahead to prepare an ordinance to raise water and sewer rates.
Robert Reynolds, from LWG, attended the meeting virtually and told the council for both water and wastewater the main strain on the utilities was past and upcoming capital improvement projects.
The five-year capital improvement plan for the water utility given to them by the town’s engineer and public works superintendent showed $7.6 million in capital improvement projects over the next five years. Of that amount, $1.1 million is currently bonded, leaving $6.5 million in unfunded capital improvement projects plus an expected $48,000 increase in operating expenses.
He suggested issuing a bond in 2025 because other debt will be rolled off by then and, in order to cover future needs, they’d need a 21.35% increase in rates and doing those things would generate $198,000 annually. He said for the minimum charge and user of about 2,000 gallons who currently pays $18.96 a month there’d be a $4.03 increase to $22.93. For the average user of 3,000 gallons, they currently pay $22.64 and they’d see an increase of $4.82 to $27.64.
Reynolds said the sewer wasn’t as straight forward, so he prepared three different scenarios. He said the capital improvements needed are not as much - $3.18 million over five years, leaving $2.1 million unfunded. The additional operational costs each year is about $66,000.
In the first scenario, there would be no additional debt, it would be totally funded by a rate increase of 42.3%, generating $498,000 in income. The impact on customers would be a $5.58 increase for the minimum user from the current bill of $13.18 to $18.76 a month. The average user of 3,000 gallons would see an increase of $13.81 and their bill would go from $32.64 to $46.45 and the flat rate user would increase from $44.22 to $62.93.
In scenario two, the town would finance $500,000 and the rates would increase 31%. Customers would see a $4.82 increase for minimum users to $18 month, average user’s bills would increase by $11.94 from $32.64 to $44.58 and flat rate bills would increase $16.17 to $60.39.
In the third scenario, the town would increase its borrowing to $1 million and minimum users would see an increase of $4 to $17.18, average users would see an increase of $9.91 and the bills would go from $32.64 to $42.55 and flat rate users would see a $13.42 increase.
Council members asked Town Manager David Wilkinson what he thought and he said, “I would avoid debt as much as possible.” He said each utility already has a few million dollars in debt.
Council members tended to agree.
Councilman Bill Musser said, “Debt scares me — we have a lot ahead of us we’re not sure about. I think we need to put it on the taxpayers rather than on the city itself. Everybody knows all communities around us have raised rates 40-70%. No one likes to pay more money — we have to pay it, too, but I’m in favor of number one.”
Councilman Larry Siegel said, “I think it’s important for the public to understand inflation has hit our water and sewer department, too. Costs have gone up. We’ve gone into debt on other projects — we’ve just been kicking it down the road.”
Council President Cindy Kaiser asked about the next steps. Reynolds said they’d prepare an ordinance and introduce the rates at the August meeting, in September they’d hold a public hearing and adopt and the new rates would go into effect the next month after that, likely in October and November.
Figuring in both amounts, the total increase for the average user is anticipated to be $18.63 a month. They were all in agreement to go with scenario one and Siegel commented, “We’d still have some of the lowest rates around.”
Wilkinson shared a spreadsheet of outstanding projects and identified projects that are needed that Public Works Superintendent Mark Aurich prepared and suggested ways to fund them. This year they have the Oakwood lift station mostly funded by bonds but with cost increases there is still an amount of $40,400 still unfunded they’re suggesting taking from the Oakwood Improvement fund.
The post aerator project at the wastewater plant would be covered by the BAN’s and both those projects would be done.
The Lakeside Water Loop is being funded by BAN in the amount of $1.1 million but there’s $12,000 short so they can take that amount from water depreciation fund.
“A project that’s been hanging out since we started is the north water tower repainting,” he said, and the estimated cost is $300,000 so Wilkinson suggesting they take $100,000 from Syracuse TIF and they can use a portion of American Rescue Plan Act (ARPA) funds and water depreciation.
He said a new roof is needed for the community building at a cost of $115,000 and they can use ARPA funds for that, too, leaving $400,000 in ARPA funds for 2024.
In 2024 they’re planning to do the Kern Road sewer extension which would cost about $400,000, using the rest of the ARPA funds. Pearl Street parking lot renovations are expected to cost $500,000 and they can use $300,000 in Economic Development Income Tax funds and $100,00 from the Syracuse TIF. There’s also some water main replacement works to be done in 2024.
They asked the council for the go ahead to use ARPA funds.
“I feel these are very good uses for them — the water tower, new roof and Kern Road,” Wilkinson said. “We’ve had the funds for over a year. We have to commit them by 2024 and use them by 2026.”
Siegel said, “This looks like a good plan — why would we not want to?”
“I think is a viable plan to get these projects knocked out,” Wilkinson said.
The council gave its blessing to use the ARPA funds and to move forward.
Siegel and Musser wanted to know the status of the current projects they feel should have started by now.
Wilkinson reported they met with F.A. Wilhelm recently who said work on the Oakwood lift station will start after Labor Day and work on the wastewater plant will star in October, with the goal of completing them by end of year, according to the contract.
Councilman Paul Stoelting asked if they’d be able to get done by then and Aurich responded, “I’m confident they will. I really am.”
Wilkinson pointed out a good portion of the work is being done by Mark’s guys as a cost savings.
In other business, the council approved renewing contracts for both Wilkinson and Aurich. After the meeting, Kaiser said the contracts are for three years and Wilkinson’s is for $90,000 a year and Aurich’s is for $85,000 a year.
The council approved the fire department’s budgets for 2024. The total budget is $3,097,071 with the fire equipment budget at $562,000 and the operating budget at $2,535,076.
Fire Chief Mickey Scott said they have 18 people and run two stations. He reported that all personnel have been training on the new rescue boat.
Parks Superintendent Chad Jonsson reported the Tour Des Lake bicycle ride was last week and they had 350 riders pre-registered and 250 showed up, likely due to the morning rain. He said the Rotary will be taking that event over — it was never a parks department event but they’ve helped and will continue to do so.
The old pavilion at Ward Park has been torn down and construction on the new pavilion and rest rooms will begin next week with hopes of completion by late August, early September.
Siegel asked about buggy parking and was told the only buggy parking was at the community center and hopefully they’ll be able to add a playground next year and consider buggy parking then.
In other business:
• Wilkinson brought up two ordinances that are on record but haven’t been enforced — one requiring that all businesses be licensed and the other a façade grant program. Council said to delete the business license ordinance and to leave the façade grant/loan as is — it’s available if someone wants to use it.
• Town attorney Jay Rigdon presented a draft of an outdoor dining procedure and asked them to look it over and take action on it next month.