Only two months ago, in November, Chesterton Utility Service Board President
Larry Brandt expressed the hope—the hope—that the Utility might be
able to forego a sanitary sewer rate hike in 2011.
At the time Brandt said that scheduled upgrades of the town’s lift stations
could potentially save the Utility a bunch of cash in overtime costs and
that such savings could negate the need to raise the rate either in 2011 or
Two months later, however, and the outlook is less rosy. At the Service
Board’s meeting Monday night, Brandt announced that an ordinance authorizing
a rate increase of 2 percent for Chesterton residents only—no increase at
all for outside users like Porter and the Indian Boundary Conservancy
District—is in the works and could be enacted by the Town Council, after a
public hearing, in time for the hike to go into effect on March 1.
Brandt estimated that a 2-percent increase would amount to “a couple, three
bucks” on the average household’s bimonthly bill.
He also said that a 2-percent increase this year would probably mean no
increase in 2012.
In the end, Brandt told the Chesterton Tribune after the meeting,
every calculation and re-calculation showed the necessity of a hike. “So
many things need to be done to the collection system,” he said. “We have to
maintain the lift stations and there are some repair projects that need to
be done because of breaks. We’ll be spending more on the collection system
than we thought, not less.”
And because the proposed rate increase is for the express purpose of funding
work on the town’s collection system, outside users—whose flows don’t impact
that collection system—are off the hook this time around, Brandt noted.
“You could argue that we have enough reserve money to cover any shortfall
and therefore we don’t have to raise rates,” Brandt said. “We did that for a
number of years in the middle 90s, when we went 10 years without a rate
increase. And we ate up our reserves. Then when we had no reserves to eat
up, we had to raise rates 30 percent. We got caught short because at the
same time we weren’t raising rates in the 90s, we weren’t doing necessary
maintenance either. We decided that’s a poor strategy. It’s better to keep
current with operating costs. Two or three years down the road, when we’re
forced to make major expenditures on the Long Term Control Plan (to reduce
bypasses), let’s hope we can pay for that within the rates.”
“We will continue to have rate increases,” Brandt observed baldly. “Our goal
is to make them as small as possible and still do the job. The unknown
factor is growth and specifically the Ind. 49 corridor. If that gets off the
ground and running, it could result in significant increases in revenue that
would offset costs. Because there’s no way costs are going to go down. It
just isn’t going to happen.”
Nevertheless, Brandt said, new Superintendent Rob Lovell’s fresh perspective
on operations is having a salutary effect on those costs. An investment in a
new centrifuge—used in preparing solids for land application—will “use less
chemicals and power” and result in a “financial benefit.” Lovell is also
investigating the feasibility of eliminating the Pioneer Point lift station,
by connecting it to the KAT lift station via a gravity line, for an
additional savings. “Put all together, we’re trying to keep increases to an
absolute minimum. Rob is already seeing things we haven’t seen before.”
2010 in Review
The Utility finished 2010 with a surplus of $499,376, despite a projected
deficit at the beginning of the year of $179,759.
Total revenues were $3,594,684 (projected $2,419,020), with total operating
revenues of $2,542,552 (projected $2,301,707).
Expenses which outperformed expectations were Pensions & Benefits at
$381,631 (projected $544,709); Purchased Power at $217,984 (projected
$321,800); and Materials & Supplies at $104,666 (projected $186,300). Total
expenses of $2,043,176 outperformed the projection of $2,481,466.
In 2010 Chesterton used 49.09 percent of its 3,710,000 gallon per day (gpd)
allotment; Porter, 56.61 percent of its 809,000 gpd allotment; the Indian
Boundary Conservancy District, 68.22 percent of its 81,000 gpd allotment;
and the plant as a whole, 50.75 percent of its capacity.
With a total of 40.85 inches of rain last year, the Utility bypassed in
three months—May, June, and July—a total of 3,937,000 gallons.
The plant treated a total of 852,081,000 gallons.
Brandt took a
moment at the end of the meeting to thank the Town Council and President
Sharon Darnell, D-4th, for re-appointing members Jim Raffin and Scot McCord.
“It’s good to have people who understand the Utility in what promises to be
a busy year,” he said. “I think we’re going to have a real good year. We
finally have gotten back most of our financial strength and put ourselves in
a position were we won’t run out of money again.”