Pasco News

Upgrade in water system weighed

By Carl Orth | Suncoast News
Published: January 26, 2013

PORT RICHEY - A water main break last November demonstrated the plight of Port Richey Water and Sewer Utility, officials said. That section of pipe was so old that manufacturers no longer make it.

Because the municipal utility dates to the mid-1920s, a patchwork of new and old pipelines has developed over the decades, according to City Manager Tom O'Neill.

A proposal would restructure rates to upgrade the system over 10 years and end inequities in billing, O'Neill told city council members.

Many Port Richey water and sewer customers live outside the city limits.

About 2,600 customers could wind up paying more. Rate hikes could start by Oct. 1. A consultant has suggested 3.5 percent annual rate increases.

O'Neill wants to wean the utility from operating subsidies from the city's Community Redevelopment Agency. The rate increases would accomplish that goal.

"The Port Richey Water and Sewer Utility can, and should be, a self-supporting enterprise fund with a properly designed rate structure," O'Neill wrote in a Jan. 9 memo to council members.

Andrew J. Burnham, senior vice president for consulting firm Burton and Associates, laid out the city's options in a draft presentation at a Jan. 15 workshop. The city had set aside money for the utility rate study and analysis from Burton, which cost $27,095.

City staff, including Administrative Analyst Jocilyn Martinez, Finance Manager Pam Ziegler and Public Works Manager Pat Stewart, helped shape the rate restructuring document.

Burnham will tweak the document after suggestions from the elected leaders and bring back a final report in the next few months.

Then city staff can write an ordinance with the proposed changes for a vote by the council, O'Neill said. Notices then would go out to customers if the proposals are adopted.

"The council was interested in expanding the affordability component of the residential rate design and Mr. Burton will present alternatives to the council with regard to that at the earliest opportunity," O'Neil said after the workshop.

In highlights from Burnham's presentation, no rate hikes are contemplated for the rest of the current fiscal year that ends in September, but adjustments in rate classifications could affect bills.

A chart shows 3.5 percent increases each year for fiscal years 2014 through 2017.

Money from the rate hikes would pay for annual capital improvements without additional debt, Burnham noted.

The extra revenue also satisfies existing debt service requirements and maintains adequate operating reserves.

The higher rates here would be consistent with national and local trends, Burnham said.

Modernization of the utility's infrastructure will require spending about $550,000 a year, Burnham forecasted.