New rates for residential and commercial users of the
city's recently upgraded wastewater treatment plant went into effect July 1 and
customers will begin receiving bills reflecting those rates in late July and
early August.
The new
sewer rates were approved by City Council following a public hearing June 21.
Under
the new rate structure, single-family residential units inside city limits will
be charged $66 per month. Low commercial users such as typical small businesses
will pay $9 per 1,000 gallons of water. High commercial users of the system --
restaurants, for example -- will pay a rate of $17 per 1,000 gallons of water
used.
In 2001,
the city was ordered to upgrade its sanitary sewer and wastewater treatment
system by the Oregon Department of Environmental Quality in order to improve
water quality and protect fish and wildlife in the Trask River and Tillamook
Bay. The plant had not undergone any major improvements since the 1970s.
The
improvement project was completed earlier this year. On a typical summer day,
the upgraded plant discharges about a half-million gallons of treated
wastewater into the Trask River, a major component of the region's ecosystem.
Frequently Asked Questions
Why did we need to upgrade our old plant?
In 2001, the Oregon Department of Environmental
Quality (DEQ) ordered the City to improve its wastewater treatment plant. The
plant, which had not undergone any major upgrades since the 1970s, discharges
directly into the Trask River, a major component in the area's ecosystem that
supports various species of fish and other wildlife. The new plant meets current,
more stringent DEQ standards for safeguarding water quality and the health of
fish and wildlife in the Trask River and Tillamook Bay
Why is the rate increase necessary?
Most of the treatment plant's buildings, tanks and
equipment that were upgraded in the 1970s were only designed to last for about
20 years and were wearing out. During previous upgrades, federal funds were available to help the city with costs. But, federal funds were not available to the city for
this upgrade. The current sewer rates were not high enough to to pay
for the plants' operating and maintenance costs as well as pay back the loans the city took out to make the required improvements. In addition, the city needs to raise money to replace aging sewer lines and underground pump stations critical to the
plant's operation.
How do other cities pay for their utility upgrades?
Utilities such as water, sewer, gas and electricity
are considered "Enterprise" services. That means they are supposed to be self-sufficient and pay for themselves through user fees. Such things as city street improvements are primarily paid for by taxes. But utilities must rely on user fees, system development connection fees (when growth occurs), special fees, or taxes if they are established
by the local government. In most cases where there is very little new growth, as is the case in the City of Tillamook, the public agencies must rely solely on user fees.
How were we able to upgrade our plant?
Fortunately, the City was able to get some grant money
(does not have to be repaid) and loan money through state and federal programs.
Unfortunately, most of that money must be paid back
over a 20-year period. Even with the low interest rate (2.87%) that the
City was able to obtain, the yearly costs are substantial.
What do
our wastewater rates pay for? Rates
pay salaries of treatment plant staff, equipment maintenance costs,
electricity
costs, chemical costs, permit costs, some general city-wide overhead
support
costs, debt service on the loan that covers construction of the
wastewater
treatment plant, and debt service on loans that paid for previous sewer
improvement projects.
How did the City determine how much
to increase the rates?
Loans from the Oregon Department of Environmental
Quality and Oregon Business Department total $15 million. The rates were
set at a level that would raise enough money to pay back the principal
and interest on these loans in the time frame required, plus cover the
operating cost of the wastewater treatment plant (labor, power,
chemicals, and
maintenance).
Why is the rate increase so large?
The loans require that
the City pay $1.2 million the first year and about $1.1 million per year
after
that. This amounts to another $100,000 per month. The first loan payment
is
due in September 2011. The City must begin
raising the rates immediately to start collecting money to cover these
payments.
Why is the rate increasing in steps?
The City needs to reach a rate of approximately
$81/month to cover operating costs and debt service. We were faced with
the choice of either increasing the monthly rate in steps or in one, big
single step that would have totaled more
than $30 per month. Making the rate increase in several steps
allows our residents to adjust their budget and plan for the increase.
What
costs does this rate increase cover?
The increase primarily covers the cost of repaying the
loans on the wastewater treatment plant upgrades. Some of the fee
increase covers increased operating costs
that are a result of new plant technologies that require additional
operating
staff.
Will the rates ever go down again?
The loan has a payback period of 20 years;
therefore, the rates will not go lower during this time. There are many
parts
of the wastewater system, including sewer lines and pump stations that
also need upgrades. The City has
identified collection system and pump station improvements that need to
be made
over the next 20 years. The loans needed to construct these improvements
will
likely extend debt service beyond the 20-year window.
Are
other towns nearby paying this much for their sewer bill?
The average sewer rate in Oregon is $52 per month.
The average sewer rate in the United States is $84 per month. Rates for
similar cities on the Oregon Coast are
summarized in the chart on the right.
Are
grants available to the City to pay for the wastewater treatment
plant?
The City received $1.5 million in grants from the
Oregon Business Department and Oregon Department of Environmental
Quality State
Revolving Fund Loan Program to pay for a portion of the wastewater
treatment
plant. We have continued to investigate funding and find that there are
no
additional grant monies available for Tillamook's wastewater treatment
plant.
Is
everyone in Tillamook paying this increase? Are commercial and
industrial users paying this much?
Yes, all users will pay increased rates. The
base and commercial user rates effective
July 1, 2010 are summarized above.
When will the new sewer
rate take effect? Rates increase as of July 1, 2010.
Will
there be a public hearing? A public hearing was held at the
City Council meeting on June 21, 2010.
How long will the
new treatment plant last?
The new treatment plant and equipment have a design
life of 20 years; however, the majority of the plant structures and
equipment
should last 40 years. The plant was built to enable the City to expand
treatment facilities if it becomes
necessary.
What other projects will need to be funded in the
future?
Southwest
Interceptor Sewer repair/upgrade
12th Street
Pump Station
North Hwy
101 Step Systems upgrades
Cross
Connection (storm Water) Corrections
3rd Street
Sewer Extension
Correction
of miscellaneous sewer infiltration issues.
Why is the wastewater collection system failing?
Portions of the wastewater
collection system (sewers) are nearly 90 years old, and have been in use
well
past their normal design life. The materials and construction practices
at the
time these sewers were built have resulted in leaky pipes that allow
groundwater into the sewer system. The groundwater leaking into the
system
causes very high flows at the wastewater treatment plant and can cause
manholes to overflow raw wastewater. The leaks need to be fixed and some
pipes
or manholes may need to be replaced.
What happens to the wastewater after it is treated?
Treated and disinfected water
from the plant flows to a sewer outfall that distributes the effluent
into the
Trask River at the wastewater treatment plant site. The wastewater mixes
thoroughly with the river water, which flows to Tillamook Bay, and
eventually
to the Pacific Ocean.
Who do I contact if I
have more questions?
Arley Sullivan, Public Works Director, (503) 842-2343
Mark Gervasi, City Manager, (503) 842-2472, ext. 3460.
Tillamook City Hall - 210 Laurel Avenue, Tillamook, OR 97141 - (503) 842-2472
