By Ken de la Bastide The Herald Bulletin
The Herald Bulletin
---- — ANDERSON – The Anderson City Council is expected to approve a 47 percent increase in water rates that will be phased-in over two years starting in 2015.
The council by a 5-3 vote passed the rate increase through two of the three readings at a February meeting along with a companion ordinance to issue $14.3 million in bonds for infrastructure improvements needed by the water department.
Final adoption of the two ordinances is expected tonight when the council meets at 7 p.m. in the City Building council chambers. Once the ordinances are approved by the council, the city will apply for a rate increase with the Indiana Utility Regulatory Commission.
The increase will result in the monthly bill for the minimum user of 3,000 gallons or less to climb from $13.36 to $19.62 and for the average user of 5,000 gallons to increase from $18.98 to $27.87.
Council members were told that the water department was facing a $1 million deficit at the end of 2014 and would have problems paying a previous bond issue.
The water department had revenues of $7.64 million in 2012 and needs to generate more than $9 million to remain solvent.
The $14.3 million bond issue will be used to construct a new water treatment plant, upgrade the city’s well fields and replace water lines.
City Council will also be asked to approve several ordinances for additional funding appropriations that are needed to meet the 2014 projected budget spending.
The Indiana Department of Local Government Finance set the city’s budget for this year in five categories at the same level as 2013 because the council missed a September deadline for conducting a public hearing on the 2014 budget.
The DLGF cut the city’s budget request by $1 million from $39.8 million to $38.8 million.
Council members in January, when told the city was operating on the 2013 budget instead of the budget that was approved by the council, indicated support for the additional appropriations.
The largest funding request in the general fund is for $1 million with $900,717 on personal services.
As a result of the missed deadline, the city lost approximately $810,000 in the tax levy for 2014, which totaled $673,000 in lost revenue.
Mayor Kevin Smith’s administration is reducing the general fund operating balance by $1.8 million this year to $2.5 million by the end of the year.
Follow Ken de la Bastide on Twitter @KendelaBastide, or call 640-4863.
Tonight's meeting Anderson City Council will meet at 7 p.m. in council chambers of City Hall to consider final approval of a 47 percent in water rates and a $14.3 million bond issue for system upgrades.