Columbus Water Works plans series of rate increases

The Columbus Water Works is planning a series of 4.95 percent rate increases over the next five years to make needed repairs and improvements, among other things, Water Works President Steve Davis told Columbus Council on Tuesday.

During his annual rate update presentation to councilors, Davis and a financial consultant outlined the need for the five rate increases that will raise average residential rates from about $49.50 a month at present to about $62 a month in 2017. The first increase will take effect Jan. 1 and raise the average monthly bill to about $52.

Davis said over the last five years, the Water Works has had to dip into reserves to balance its budget and has been ordered by the state Environmental Protection Division to repair some sewer basins that overflow in heavy rains.

"That's amounted to about an $18 million cost to us over seven years, so that is certainly a driver in our rate structure," Davis said. "Our infrastructure is always a big driver in our finances. We've got over 2,000 miles of water and sewer line. We have major treatment plants. We have a lot of infrastructure that continually needs reinvestment."

Davis said the Water Works is also planning a $25 million bond issue in early 2014 and another $11 million in infrastructure work that will be funded by the planned rate hikes.

Jon Davis, with Raftelis Financial Consultants, said his firm has analyzed recent and future spending plans and agrees that the increases are necessary.

"We've had some inflationary increases in operating costs, personnel costs, materials, things of that nature," he told council. "We're also looking to fund the capital program. We have a lot of infrastructure renewal needs."

Davis said the American Water Works Association's study of rate increases nationwide shows an average increase of 5.6 percent.

"So Columbus Water Works, even though it's up a little over what it's been historically, it's still well below the national average," Davis said.