Aldermen Take Next Step Toward Increasing City Water and Sewer Rates

The Smithville Aldermen adopted a new $6.4 million budget for the 2017-18 fiscal year on first reading Monday night.
The proposed budget totals $6-million 411-thousand 679 dollars. Under the new spending plan, the property tax rate will remain the same at 64.9 cents per $100 of assessed value. The city property tax rate is budgeted to generate $884,000.
Water and sewer rates are to increase effective July 1. City water customers are to pay $7.25 per thousand gallons of usage, up from the current rate of $5.00 per thousand gallons. Rates for customers outside the city limits are to be $10.88 per thousand, an increase from the current rate of $7.50 per thousand gallons. City sewer customers will see an increase from the current rate of $5.00 per thousand gallons plus the flat usage rate of $3.62 to $6.75 per thousand gallons. The rate increase is to help make up the difference in the loss of $775,000 in revenue due to the departure of the DeKalb Utility District as a water customer.
The new budget includes a 2% across the board cost of living pay raise for city hourly and salaried employees except for the police department which already has a wage scale with scheduled step increases for its employees. The cost to the city for the pay raises is $40,000. The city is implementing a new method of awarding Christmas bonuses in the new budget. Bonuses will be paid based on longevity ranging from $250 for employees with up to five years of service to a maximum of $600 for those with more than 20 years of service. Previously, the city has given bonuses at 1% of an employee’s salary paid in December at Christmas time. By making this change, the city will save $2,000.
The budget includes $925,945 in proposed capital outlay expenditures in the general fund but most of that, $725,945 is for the new fire pumper/rescue truck which the city has ordered and $83,000 for three used police cars and a used investigator’s car which Police Chief Mark Collins has requested. The fire truck will actually be paid for over two budget years.
A total of $50,000 has been included for the city hall building, most of which is expected to be used to make repairs to the elevator at city hall after lightning from a recent thunderstorm put it out of commission. The budget includes $15,000 to add side loaders to garbage trucks as the city prepares to convert to a new street side automated side loader garbage collection system. A total of $2,000 has been added to purchase software and handheld scanners for more efficient processing of water bill collections especially at the city hall drive through window.
Alderman Josh Miller last Thursday night during a workshop requested that the city’s allocation to the Smithville-DeKalb County Rescue Squad be increased by $500 from $1,500 to $2,000. That request will be funded.
The city is expected to wrap up the 2016-17 general fund budget year June 30 in the red by $640,150 primarily due to the city’s purchase of a new automated side loader sanitation truck and new garbage collection containers which costs $350,000 and for the city’s matching construction costs of the new Holmes Creek Bridge which was $111,485. The total bridge project cost $723,000 but the state paid most of it at $611,515. Another factor adding to the deficit is the city’s $350,000 cost for street paving. A total of $201,000 has already been spent for paving this year with more expected. If the city does finish the year with a deficit, the difference will be drawn from the general fund surplus to balance the budget.
For the 2017-18 year, the city is projected to end the year on June 30, 2018 with a general fund deficit of $802,840, most of which is due to the new fire pumper/rescue truck at $725,945 and for the purchase of four used police cars at $83,000. Again, should the city end the fiscal year in the red, the difference will be taken from the general fund surplus to balance the budget.
The city’s water and sewer fund is expected to end the fiscal year June 30 with a surplus of $242,179 but even after the rate increases the water and sewer fund is expected to only break even by the close of the 2017-18 fiscal year on June 30, 2018 after the departure of DUD as a water customer. The city is underway with a sewer plant rehabilitation project which is costing $2,750,000 and $40,000 for tube settlers for the water plant. To help pay for the cost of the sewer plant project, the city was awarded a Community Development Block Grant in the amount of $525,000 from the Tennessee Department of Economic and Community Development. Although the grant will fund part of the costs, the bulk of the funding to pay for it will be appropriated from the city’s water and sewer fund surplus.
The Smithville Mayor and Aldermen will meet in special session on Monday, June 19 at 5:30 p.m. at city hall to adopt the new budget on second and final reading.