By Mike Rutledge
NKyTribune Reporter
Thanks to a 2014 Valentine’s Day gift from the U.S. Environmental Protection Agency and cost-cutting measures, Northern Kentucky’s Sanitation District No. 1 is leaning toward not raising sewer rates this year.
If that preliminary decision holds true and is approved by the top county elected officials of Kenton, Campbell and Boone counties, it will be good news to rate-payers who saw their sewer bills climb by 15 percent in both 2011 and 2012, with another 5 percent increase last year.
The typical residential customer now pays $42.12 per month for sewer service, plus a $5.04-per-month storm-water fee.
SD1’s board considered two options at their last meeting: A 5 percent boost in rates or no increase. The board chose the no-increase option.
“They felt they could live within the budget,” said SD1 Executive Director David Rager.
Officials in recent years had predicted multiple years of large rate increases in order to finance sewer construction projects aimed at reducing the amount of sewage that spills from SD1’s system. But the sewage and storm-water utility received relief thanks to a Feb. 14, 2014, letter from the U.S. EPA that agreed with SD1’s argument that the remedies the utility and federal agency had agreed to were too expensive for the region’s residents to bear.
SD1 in 2011 estimated that to comply with the EPA lawsuit agreement, the utility would have to increase its rates from 2011 to 2019 by a total of 107 percent to 126 percent. That’s essentially now on hold.
“When we submitted our compliance plan to the EPA, we told them, ‘Here’s what we would need to build, and this is how much it’s going to cost, and we believe that’s unaffordable for the Northern Kentucky community,” Rager said.
“Our consent decree has a provision in it that says if we think the plan is unaffordable, we get to raise our hand and say, ‘Hold it. Time out. We’ve got to talk about this.’”
That’s what SD1 did.
“We raised our hand and said, ‘Wait a minute. Here’s what we need to do to come into compliance. Here’s the cost of it. We believe that’s too expensive for the community to achieve within the timeframe you want us to achieve,’” Rager said.
“So on Valentine’s Day, 2014, the EPA sent us a letter and said, ‘Yeah, we agree.’ And under our consent decree, that then means we reopen, to discuss how we structure the plan so it is affordable. And we’ve been in discussions with them over a year now, trying to figure that out.”
The budget option SD1’s board preliminarily approved “does not contemplate moving on with those projects because we’re still trying to figure out with the EPA, ‘What are we going to do to make this affordable?’” Rager said.
Meanwhile, SD1 has been working to run its operations more efficiently, he said.
“We’ve been working very diligently on finding ways to reduce the operating costs. We’re looking for ways to use less chemicals, use less energy, do things more efficiently,” he said. “And we’ve been successful at that. The last two years we’ve brought our actual expenditures in anywhere between 2-3 percent under budget. So all year long, we’re trying to find ways to save money.”
Meanwhile, the utility has been replacing some crumbling, aging pipes, which helps prevent the sorts of sewage leaks into the environment that the EPA wants eliminated.
Meanwhile, significant rate increases may have to resume once SD1 and EPA agree on a timeline to make the remedies SD1 agreed to do.
Here’s what happens next, according to SD1 spokeswoman Jamie Holtzapfel:
A public comment period will begin May 26 and run through June 9 on the issue of rate increases.
Comments can be emailed to info@sd1.org. Officials ask that you put the words “Budget Comments” in the subject line. Written comments can be delivered in person at SD1’s main office, 1045 Eaton Drive, in Fort Wright, during regular business hours of 8 a.m. to 4:30 p.m. Monday through Friday. They also can be mailed to Valerie Forsyth, SD1, 1045 Eaton Drive, Fort Wright, KY, 41017.
Copies of the draft budget will be posted on SD1’s website and at local library locations during the comment period.
SD1’s board will meet June 16 to make its final decision on the budget for the next year, including on the rate hikes. The three judges-executive will meet June 29 to make their decision on the matter. The new budget will take effect July 1, and if there are rate increases, they will be reflected on August bills.
