Sanitary sewer rates in New London are expected to increase over the next three years as the utility strives to improve its financial position.
Current rates do not recover the value of utility assets lost through aging and wear and tear, and rate increases will help remedy that issue.
The city of New London recently commissioned a full study of its sanitary sewer rates and charges for the first time since 1987.
The study found that current rates are sufficient to meet operation and maintenance costs but do not recover the depreciation of utility assets. This means the Utility is able to meet day-to-day expenses, but rates do not recover the value of utility assets lost through aging and wear and tear.
The rate study report recommended a rate increase to improve the utility’s financial position and ability to issue debt, if necessary, in the future.
The report finds that increasing the volume rate from the current $5.14 per 1,000 gallons to $5.84 per 1,000 gallons will put the utility on track to improve its position over time. The report recommended phasing in a flat monthly fee for each customer starting at $0.80 per month and increasing to $1.60 in 2013 and $2.40 in 2014.
The proposed changes are expected to increase monthly bills to average residential customers by $4.85 between now and 2014.
The report also recommended increases in wastewater charges to industrial customers producing wastewater with higher than normal concentrations of pollution. The report recommended making these changes over a number of years to minimize the impact on these users.
The rate study report and the proposed first phase ordinance change for sanitary sewer rates were presented to the Board of Public Works on Jan. 3. The Board recommended that the City Council approve the recommended sanitary sewer phase one rate change ordinance. This ordinance change was posted for two weeks in the County Post East’s legal section.
A public hearing was held in regards to the sewer rate ordinance change at the Jan. 10 Common Council meeting. No one from the public spoke on this issue.
The second reading will take place at the Feb. 14 Common Council meeting, after which Council members will vote on final approval of the proposed change.