Thursday, January 28, 2010
By Jordan Cohen
NILES — A three-year rate increase under consideration by the Mahoning Valley Sanitary District could cost Niles up to $300,000 a year.
Randy Fabrizio, water superintendent, estimated the potential cost during a meeting Wednesday with Tom Holloway, chief engineer of the MVSD, and Matt Blair, MVSD board chairman. MVSD, which markets its product as Meander Water, sells water wholesale to Niles, Youngstown and McDonald.
“[The increase] is going to affect our budget from 3.5 [percent] to 5 percent each year,” Fabrizio said, adding that the minimum additional cost to the city would be $200,000 above the current water budget. Fabrizio said that the monthly cost to residential users cannot yet be determined.
Holloway said the rate “adjustments” are necessary to cover the costs of $13.4 million in capital improvements, existing debt, and operating and maintenance expenses. He emphasized that the MVSD board has not officially set the amount of the increases but projects the increases will cost Niles an additional $1.67 per 5,000 gallons by July 2012.
According to figures provided by the MVSD, Niles consumed an average of 6 million gallons daily in 2009.
Holloway said, however, that usage of Meander Water by all its customers has dropped by 1 million gallons a day. That led Councilman Ed McCormack, D-4th, to ask if it was necessary to include more than $3 million for the Berlin Pump station among the capital improvements. Berlin is used as a backup system.
“The Ohio Environmental Protection Agency strongly suggests secondary sources of water,” Holloway said. “I don’t think we want to take the risk [of not having it].”
“We’re going to have to see how all of this will affect our budget and our sewer rates,” said Mayor Ralph Infante. The mayor said the city would review the impact of the tentative proposals and ask for another meeting with Holloway.
In addition to providing water for Niles residents and businesses, the city also sells water to Lordstown, Girard, portions of Mineral Ridge and the Four-Township Water District. Infante said he expects any MVSD increases to be passed along to all of the city’s customers.
“It looks as though you will have rate increases every year for six years,” said Robert Marino, council president, who noted that the figures included projected increases through 2015 even though the proposal is limited to the next three years. “Eventually enough will be enough.”
Holloway said the board has not yet decided when it will make its final determination on the amount of the rate increases. Once it does, the recommendation will be brought before a two-member court of jurisdiction consisting of one judge each from Mahoning and Trumbull counties. The current three-year rate structure expires June 30.