ST. PETE BEACH — The city plans a 7% increase in its wastewater service fee and a 20% increase in reclaimed water user fees by Oct. 1.
During the Aug. 27 commission meeting, City Manager Alex Rey said an increase to the wastewater fee is needed to furnish sufficient funding for treatment fees imposed by the city of St. Petersburg and to provide adequate debt service coverage for the city’s plan to borrow from the State Revolving Fund loan program to upgrade its sewer system.
In November 2014, the city was placed under a consent order by the Florida Department of Environmental Protection for what was seen as its inadequate sewage system; the city then conducted a study to prove its existing sewer system was operating at above capacity in critical locations.
In 2016, the city adopted a moratorium to prevent new development or redevelopment that would increase sewer flow until additional capacity is provided to help ensure sanitary sewer overflows do not occur. Improvements to the sewer system are needed to lift the moratorium and allow new development.
The city plans to borrow about $2 million from the state’s Revolving Loan Fund Program, so it can undertake a $16.6 million sewer system upgrade, which will increase its sewer system capacity and end the three-year building moratorium.
Authorization of the requested increase will provide $609,945 in estimated new revenue, as needed to fund a portion of proposed wastewater fund expenditures of about $16.6 million.
The city needs $450,000 to cover debt service, interest and principal on an open-ended revolving loan, or line of credit, that will allow it to borrow as much as it needs at very low interest, Rey told commissioners.
He added the city also hopes to tap into state transportation, sewer improvement and job growth grants to reduce some of the project’s costs.
The fiscal year 2020 service fee increase is intended to be the first of three successive fee increases in the Wastewater Fund, Rey said. Projections currently assume 7% annual increases in fiscal year 2020, 2021, and 2022. The latter increases are subject to further analysis, as staff continues to refine long-term cost estimates in the capital improvement plan.
Under the 7 percent increase residents and commercial users who pay a base rate of $33.91 will be charged $36.28 for the first 3,000 gallons per residential unit. The residential excess rate will go up from $11.19 to $11.97 for each 1,000 gallons.
Rey told commissioners the reclaimed water rate hike is needed to provide sufficient funding for increases in what the city pays for its wholesale reclaimed water.
“Pinellas County is planning to impose a cumulative fee increase of approximately 330% over the next four years,” the city manager told commissioners.
The fiscal year 2020 fee increase is intended to be a onetime, standalone increase. Authorization will provide $174,875 in estimated new revenue, as needed to fund proposed Reclaimed Water Fund expenditures of approximately $800,000.
If enacted by the City Commission, the monthly reclaimed water user fee would rise from the current $17.70 to $21.24.
“The cost of reclaimed water is going up; the increase is necessary to cover cost increases from the county and maintain adequate operating reserves for the ongoing operation of the reclaimed water system,” Rey said.
The city manager explained when reclaimed water was first introduced the county wanted to get rid of it. Now, it’s such a valuable commodity, the county changed its philosophy and even wants to start metering its use, like they do for drinking water.
Commissioners noted many people waste reclaimed water and sprinkle their lawns even after a heavy rain. They favored the idea of metering reclaimed water use to preserve the resource.
In other news
To follow city charter requirements that stipulate the City Commission must meet at least twice in every month, while avoiding holiday weeks, staff recommended the city’s November and December meeting dates be changed to Nov. 12 and Nov. 13 and to Dec. 10 and Dec. 11. In both instances, the meeting days are Tuesday and Wednesday.
Staff further suggested that the Nov. 12 and Dec. 10 meetings be conducted as regular City Commission meetings, and the Nov. 13 and Dec. 11 meetings be conducted as strategic planning workshops.
“Revising the meeting schedule provides for conformance with our code, accommodates holiday schedules, and initiates the pathway to launch our strategic planning for the next five years,” the city manager told commissioners, who unanimously adopted the change.