by Phil Keren
Silver Lake -- "It's just something that needs to be done."
That's what Village Council President Carol Steiner (District B) said about a proposal before Council to increase water rates by 8 percent this summer and by a total of 16 percent over the next year.
Teresa Spohn, the village's clerk-treasurer, proposed the hike and other actions to help cover a projected $107,500 shortfall in the water fund by the end of 2008.
Spohn said the proposed hike in water rates would generate $80,078 for the water fund by the end of 2008. She added she is also planning to reallocate $35,000 in salaries and benefits from the water fund to the sewer fund to make up for the remaining estimated shortfall.
Council discussed a draft version of the water rate increase on June 18. The proposal is scheduled for a first reading before Council on July 2.
Spohn said her proposal is based, in part, on the possibility that Cuyahoga Falls would increase its water rates. Silver Lake receives its water supply from Cuyahoga Falls. Spohn said the village's 20-year water contract with Cuyahoga Falls expired in April. John Christopher, the Cuyahoga Falls water superintendent, said Falls charges Silver Lake its residential rate plus a 20 percent surcharge. Christopher said he was not aware of any plans to increase the rate.
The village paid $131,000 to Falls for water in 2006 and $130,000 in 2005.
Why the increase is needed
Spohn told the Falls News-Press that while expenses in the water fund began exceeding revenues in 2001, there has been enough of a carry-over each year to cover costs without increasing rates.
"From 2000 to 2006, only 2000 was revenues exceeding expenditures," said Spohn, who added that expenditures exceeded revenues by $70,000 in 2003.
During those years, Councilmembers noted they decided to use the surplus money to cover the added costs instead of raising rates.
"We held the line and held the line ... at some point in time you have to raise the rates in order to meet the current expenses," said Council Vice President William Church (At large).
Spohn said last year's 13 percent increase in water rates "wasn't enough."
Councilman Adrian Achtermann (District D) noted the cost of labor, supplies and services in the water fund are increasing, but added the price of water is "not going up all that much."
Spohn said the increased costs are "mostly from operations" such as salaries, equipment, fuel, utilities, office supplies and postage. She noted that the operating expenses comprise about two-thirds of the water fund money, while the remaining one-third is tied to the cost of water.
Water rates were increased last year by 13 percent and that legislation included a provision to raise the rates by 2 percent each subsequent year through 2010. Spohn said the new rate increases, if approved by Council, would be implemented "in lieu of" the scheduled 2 percent annual increases. However, a 2 percent increase will still be applied to the bills due Feb. 10, 2009, and Feb. 10, 2010.
Transfer approved to cover projected 2007 shortfall
Council on June 18 unanimously approved transferring $45,000 from the general fund to the water fund to cover a projected shortfall in the water fund this year.
Spohn said water fund expenditures are outpacing water fund revenues by about $37,000 this year and told Council the transfer will "shore up the water fund for the remainder of 2007."