BETHANY, Okla — The Bethany City Council had a long, contentious meeting in regard to a utility rate study and possible action regarding rate increases on Tuesday, Oct. 3.
The Council approved water and wastewater rate increases to go into effect Jan 1, 2024, with multiple members dissenting.
The rates are the result of a study that looked at the next 20 years of Bethany capital improvements and the deficit spending the city currently does to make up for its low utility costs.
The council spent hours on the item, with plenty of passionate arguments for and against this specific rate increase proposal.
Utility rate increase presentation
It is no surprise that Bethany’s water and sewer infrastructure is aging. However, the City has some of the lowest utility rates in the OKC metro area, making any repairs or improvements financially difficult.
Municipal Financial Services representative Jon Wolff gave the council a utility rate study presentation that found Bethany must raise utility rates to simply keep up with current maintenance costs.
As of now, Bethany’s base water and sewer rate with volumetric increases for every additional 1,000 gallons used falls behind most other nearby municipalities.
10-03-23-Bethany-City-Council-Billing-Analysis-SummaryIn fact, the rates do not currently pay for the operational and infrastructure demands. The City is running water and sewer at a loss of about $1.26 million per year.
The Municipal Finance Services presentation had rate recommendations to make up for this gap, and have money for the next 20 years of projected capital needs.
Cost breakdown and rate proposals
MFS figures the utility rate increases by estimating the costs of water/sewer capital improvements over the next 20 years.
Water-and-Sewer-Rates-as-approved-by-Council-10-3-2023The document is hard to parse out, but here are the general takeaways of the study;
- Critical water system infrastructure is estimated to cost Bethany around $41 million.
- The MFS hypothetical cost for Bethany’s share of the critical water treatment plant improvements is anywhere from $3 to $26 million, and they use the $16 million estimate for the sewer rate increase. Bethany will receive an engineer’s estimate in 2024 which will solidify the cost.
- MFS recommends that base water rates be raised to $19.60, and sewer rates be raised to $17.37. The volumetric use increases are to be adjusted to be about 25% higher.
- The proposal also included a clause to raise rates annually by between 3% and 6% in line with the consumer price index.
Council questions
After the presentation, the council moved to question Wolff about the proposed rate increases.
Council member Palmer of Ward 2 started off the conversation with a series
of clarifying questions on behalf of residents.
“This rate increase will cost, on average, $20 per utility customer in the city of Bethany. Is that right?”
Wolff clarified that the “average” customer used about 5,000 gallons of water per month, and about the same in wastewater, if not a little less.
“We are looking at about a $17.15 increase [per month].”
Council members questioned the estimates regarding the wastewater treatment plant, and if they should wait to raise rates until that estimate is solid.
“The second part of this, based upon the workshop we had, was related to financing for the improvement needs to the treatment plant… Is that correct?” Council member Palmer asks.
Wolff responded, “It included potential costs, based on, potential-,” before being cut off by Palmer.
“Right. And when you say potential, we don’t know what that cost is, right?”
Council arguments and decision
The first motion in regards to the rate increase was made by council member Peter Plank of Ward 1, requesting that the increases not be effective until Jan 1, 2024.
“To get us through the holidays, get the residents through the holidays,” Plank explained.
Council member Brian Magirowsky of Ward 4 spoke distinctly for the rate increase.
“The buck stops here. It’s time. We have kicked the can down the road long enough, and we need to fix our problems.”
In contrast, Council member Palmer thought it was all happening too fast.
“This is way too fast, in my opinion,” said Palmer. “We had a workshop last week, and then 10 days later we’re having rate increases that could hit on November 1… That’s why, I’m going to vote against this resolution, depending upon the discussion. ”
Council member Marilyn McPhail of Ward 3 agreed.
“I’m not against a rate increase, but I am against how it is being shoved down citizen’s throats.”
The council discussed the elderly who are on a fixed income and the lack of information provided to citizens when Ward 3 council member Kathy Larsen gave her take on the proposed increases.
“If people don’t want to participate, they don’t want to be aware of what is going on, there is nothing we can do about that as a city… We have got to be forward-thinking.”
Mayor Nikki Lloyd added an amendment to increase the base rate to 2,000 to make the rate increase less impactful on single-family households.
Wolff later clarified that this would make those particular customers’ water bills cheaper after the rate increase takes effect.
The vote was called, and the council members voted consistently with their arguments.
Council members Plank, Magirowsky, Knapp, Larsen, and Mayor Lloyd all voted for the proposal.
Council members Powell, McPhail, and Palmer voted against the rate increase.
The next Bethany City Council meeting is scheduled for Tuesday, October 17, 2023, at 6:30 PM.
Damian Powell is our government reporter for the smaller municipalities in the OKC metro such as Moore, Norman, Bethany, and Warr Acres. Damian is studying Political Science at the University of Oklahoma.
