ONLINE UPDATE: CFPUA considering rate increase

by Sam Wilson
Friday, February 28, 2014

New Hanover County residents could soon see a bump in their water bills following a drop in revenue for the utility authority over the past year.
The Cape Fear Public Utility Authority will hold a public hearing March 12 at 9 a.m. to weigh its proposals to increase residential water and sewer rates.
The proposal comes less than one year after the authority increased the average bi-monthly bill 10 percent, adopting a uniform rate structure that went into effect May 1, 2013.
Authority spokesman Mike McGill said Feb. 28 the board will hear staff present three proposals, with increases in water and sewer rates ranging from 2.9 to 12 percent and 3.8 to 13.1 percent, respectively. No changes to fixed rates, which cover the authority's debt service, are being proposed.
The staff's recommended proposal anticipates a further 4 percent reduction in water usage in 2014, and would increase water rates 7.3 percent, or 25 cents per 1,000 gallons used. Wastewater rates would increase 8.3 percent, or 35 cents per 1,000 gallons used.
"Our rates are directly tied to the cost incurred when it comes to producing and treating water and wastewater," McGill said. "We're very similar in that we face the same price and cost increases that everyone else feels at home; fuel rates, energy costs [and] we have chemical needs that can go higher or balance out. That's part of what we have to respond to."
He added that a wet summer in 2013, during which the utility's customers' water consumption declined 7.3 percent, contributed to the proposed rate hikes. Coupled with related declines in wastewater, the total revenue loss for the authority was $2.3 million compared with 2012.
"We understand an extra rate increase is something no one is going to be especially pleased with, but ... in a time when consumption is down and we need to balance out the cost, $2.70 a month, we hope, is a reasonable rate increase [for a 9,000 gallon per month user]."
Following the public hearing, the authority board will vote on whether to implement one of the proposals, or propose their own solution.
The presentation given by staff to members of the finance committee addressing the proposed rate increases can be found at http://www.cfpua.org/DocumentCenter/View/6113.

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