City hires firm to do water, sewer study

July 20, 2016 GMT

ROCK FALLS – The city hasn’t stayed on top of its utility rates, and that could be bad for its bottom line. What that means for ratepayers’ bottom line remains to be seen.

On Tuesday, the city council approved a proposal for a rate study of the city’s water and wastewater utilities to be done by Holland, Michigan-based Utility Financial Solutions at a cost of $19,100.

City Administrator Robbin Blackert said the study won’t necessarily be a precursor to a rate increase, but said the city must be diligent in making sure rates are in line with operating costs. When increases are in order, it’s in residents’ best interest to plan ahead.

“Rock Falls has been good at keeping up with infrastructure improvements, and if you aren’t, that’s when you have big increases,” Blackert said. “We’d rather have small, gradual increases.”

Utility Financial Solutions will soon complete a similar study for the electric department. The company was one of six bidders for that job, charging $27,450 for its services.

While the city has hired professionals to do similar studies in the past, the schedule has been sporadic.

“We should be doing them every 5 years for each utility,” Blackert said. “If we don’t, we’re doing a disservice to the ratepayers.”

The massive overhaul that continues at the sewer plant makes it even more important to stay on top of the numbers.

“The last time a rate study was done for the sewer department was just prior to applying for the EPA loan to guarantee we could pay back the $27 million,” Blackert said.

The plant became operational in July 2011, and after problems that resulted in shutdowns of the city water supply, new pumps are being installed.

In April 2015, Mayor Bill Wescott first proposed that the city establish a governance board for the city’s utilities. The rate study information would be one of the metrics that board would continually monitor.

“We have to ensure that the costs we put on the bill every month accurately reflects the cost of providing that service,” Wescott said.

The mayor said the cost-of-service metric would be carefully evaluated on a monthly basis.

“It might not be right on target every month, but if it’s not within our parameters, it needs to be fixed right away,” Wescott said.

Blackert said it’s been 7 years since the last electric rate study was done, and more than a decade for the water department.

In other action involving the water department, the council approved Superintendent Ted Padilla’s request for submersible pump equipment for the Well 7 rebuild. The equipment will cost $98,721, and will take about 5 months to be built and delivered.