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County weighs changes to fees

POSTED: April 21, 2014 5:36 p.m.

Effingham County commissioners didn’t approve a new schedule of fees, but after their discussion on the topic, a restructuring appears to be in the offing.

Chairman Wendall Kessler said he explored the rates private water systems are charging and suggested the county push toward those levels but not beyond.

“Prior to Effingham County government being in the water business, the only water systems were privately-owned,” he said. “The theory is public-owned systems should charge enough to break even. There’s no way we could raise our rates high enough to break even.”

The county’s water rates likely are headed up, regardless, as the county passes along the rate increase it is getting from its provider, Savannah Industrial and Domestic Water.

Savannah Industrial and Domestic Water has increased its rates over the last two years, but the county has absorbed that cost, rather than passing those hikes on to its customers. Rates last year went from $1.78 per 1,000 gallons to $1.84, and they rose to $1.89 per 1,000 gallons April 1.

Rates have gone up each year from $1.36 in 2007. The rates charged from Savannah are a quarter of the county’s water system expenditures, according to county finance director Joanna Wright.

County public works engineer Steve Liotta explained that a 10 percent hike in rates generally leads to a 3 percent decrease in water usage.

“People stop using water when the rates get high,” he said.

At current rates, the county’s water system likely won’t break even until 2028. If the county opted to triple its rates, its payoff of GEFA loans would speed by up five years, according to Liotta. Liotta added they are not recommending the commissioners approve tripling the rates.

Liotta said the county’s rates are low compared to neighboring municipalities and counties.

Kessler said he favors user fees over taxes and wants to see the rates closer to a level that pays for the system’s cost.

“We’re going to take some flak from some folks,” he said. “But the people who use the system should pay for it.”

Commissioners were presented with three different scenarios on monthly water rates, starting with a rate increase to cover the hike from Savannah I&D. With a $10 base rate, residential users would pay $2.44 for each 1,000 gallons used up to 5,000 gallons, and $2.66 per each 1,000 gallons from that level up to 10,000 gallons. After that level, the rate is $2.88 per 1,000 gallons used.

There is also a proposed $20 base rate, with $3 charged for each 1,000 gallons used up to 5,000 gallons, and $4 for each 1,000 gallons up to 10,000 gallons. For more than 10,000 gallons, the charge would be $5 per each 1,000 gallons used.

A third scenario, which would provide full cost recovery for the water system, would start with a $35 base rate. The charge for each 1,000 gallons used up to 5,000 gallons would be $3.50, and then go up to $7 for every 1,000 gallons up to 10,000 gallons used per month. For every 1,000 gallons over 10,000 gallons used per month, the rate would be $18.50. But as Liotta pointed out, that did not take into account how much water usage would fall with higher rates.

The county has about 1,000 residential water customers and approximately 30 commercial water customers.

Drilling a well to augment or replace the water bought from Savannah I&D also has its limits. It would be a significant capital investment and because of the state Environmental Protection Division’s “red zone,” it would have to be installed north of Highway 119. The county’s customer base is in the southern end of the county, miles from where a well could be drilled.

The county has stopped collecting a fee from people who turn in animals to animal control. Many of them were good Samaritans who found animals wandering around and turned them over to animal control.

The county also may up its fees on rezoning requests from $140 to $200.

“We’re losing money at $140,” Kessler said.

County clerk Stephanie Johnson added that the county’s zoning fees are lower than those of surrounding counties.

Commissioners are expected to vote on the new slate of fees at their May 6 meeting.

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