|Link to site: Matt Scallan, River Parishes bureau, April 01, 2006|| Return to: watercenter.org|
- progressively raise water rates for the biggest users, was one of seven options to pay for a proposed $25 million expansion project
- proposal would raise the rate for using 1,000 gallons of water from $2.22 to $4 for customers who use between 6,000 and 10,000 gallons per month and $4.30 for usage of more than 10,000 gallons per month. The first 6,000 gallons of water would remain at the current rate for all users.
- The proposed expansion would involve linking the east and west bank water plants, adding 6 million gallons per day of drinking water capacity on the east bank water plant, and 3 million gallons per day of capacity to the west bank plant, as well as building a new west bank storage tank.
The proposed water rate increase that the St. Charles Parish Council will consider on May 1 is designed to tread lightly on most water users and avoids funding mechanisms that would require voter approval.
The measure, which would progressively raise water rates for the biggest users, was one of seven options to pay for a proposed $25 million expansion project that engineer Rick Shread presented to the council at a special meeting Thursday.
The other measures would have either required the parish to seek voter approval for increased property taxes or required small water users to pay more.
The plan that the council is considering will be introduced in ordinance form at Monday's council meeting. It won't come to a vote until the council's May 1 meeting. That proposal would raise the rate for using 1,000 gallons of water from $2.22 to $4 for customers who use between 6,000 and 10,000 gallons per month and $4.30 for usage of more than 10,000 gallons per month. The first 6,000 gallons of water would remain at the current rate for all users.
Adoption of the plan would mean that 62 percent of the parish's 17,549 residential users would see no rate increase, according to Shread's firm, Shread-Kuyrkendall and Associates.
Currently, all users pay the $2.22 rate regardless of how much water they use, plus a $4-per-month service fee.
The proposed expansion would involve linking the east and west bank water plants, adding 6 million gallons per day of drinking water capacity on the east bank water plant, and 3 million gallons per day of capacity to the west bank plant, as well as building a new west bank storage tank.
To pay for the expansion, the system must generate about $3 million a year for the next 25 years, either by raising user fees or through property taxes.
Councilman Clayton "Snookie" Faucheux said St. Charles is the only parish in Louisiana where the water system isn't subsidized by property taxes. The parish levied a property tax until the east and west bank water systems merged in the late 1980s. Parish officials say the taxes went off the books in the mid-1990s, and the parish switched to a fee-based system, partly because of industry requests.
As they would under most of the options presented at Thursday's meeting, businesses would bear the brunt of the rate increase through taxes or higher user rates.
Lily Galland, chairwoman of St. Charles Industrial Council, said she could not comment on the specifics of the council plan, but said the parish's industrial taxpayers are willing to help.
"We want to work with the parish to ensure that the infrastructure meets the needs of its citizens," she said.
Ron Guillory, spokesman for the Valero St. Charles Parish Refinery in Norco, said the company won't comment on the proposal until it has a chance to study it, but noted that the refinery voluntarily reduced its water usage from about 60 million gallons per month to about 20 million after water supplies got tight after Hurricane Katrina.
The east bank system has been stretched to its production capacity and the main production unit cannot be turned off for needed repairs without causing a critical water shortage, parish officials say. Two smaller units produce water at a combined maximum rate of 3 million gallons per day, but their actual daily capacity is less.
Waterworks director Robert Brou said the main east bank unit could suffer a catastrophic failure at any time, leaving the east bank without enough water to meet its needs.
In addition, the west bank water system will begin facing its own capacity issues in the next few years as an expected 5,000 new homes are built in existing subdivisions.
"We're supposed to be the silent service, but people don't realize how much technology goes into a glass of water," Brou said.
Parish President Albert Laque's administration also proposes linking the two plants with a connection across the Mississippi River, building a million-gallon water storage tank on the west bank, and expanding that plant's daily capacity from 9 million gallons to 12 million gallons.
One of the options that Shread presented to the council would have involved asking voters to approve a 3.76-mill property tax, possibly in a July 15 referendum.
But Parish Council Chairman Brian Fabre said passing a property tax is no sure thing.
"It used to be that if you proposed a tax, everybody would vote for it because it would be on industry's back, but not since everybody got reappraised," he said, referring to the dramatic rise in property value that led to an increase in residential tax bills in 2004.
Shread noted that calling a referendum would be time-consuming and possibly could fail in a parishwide vote and delay the resolution to the most serious problem.
Other options that were considered include:
-- Raising rates to $3.45 per 1,000 gallons, which would mean a $7.38 monthly increase to a customer using 6,000 gallons.
-- Raising the monthly service fee from $4 to $16.77, an increase of $12.77 per month to all existing customers.
-- Raising the monthly service fee from $4 to $5 and the rate to $3.30 per 1,000 gallons. This would cost the user of 6,000 gallons of water an extra $7.48 per month.
-- Splitting the revenue stream by raising water rates to $2.84 per 1,000 gallons and levying a 1.96-mill property tax. This would raise the bill of a 6,000-gallon user by $3.72 per month, plus the property tax increase, which would total $9.80 per year for the owner of a homestead-exempt home assessed at $125,000. A business assessed at $500,000 would pay an additional $147 a year in property taxes.
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Matt Scallan may be reached at firstname.lastname@example.org or (985) 652-0953