Valpo water bills likely going up again
By James D. WOlf Jr. Post-Tribune correspondent November 23, 2012 2:00PM
Updated: December 26, 2012 6:27AM
VALPARAISO — Residents will likely see another utility rate hike by midsummer, the second utility increase in less than a year.
How much rates will increase still needs to be determined through a study on the city’s future water supply, said Utility Director Steve Poulos.
The utility department has hired a consultant to consider whether to drill new wells or bring in bulk water from a company such as Indiana American Water, which provides water to municipalities in Northwest Indiana.
The wells near Porter County Regional Airport are about 40 years old and at the end of their expected lives, and some have been decommissioned, and the 20- to 24-year-old wells near Flint Lake had troubles during this summer’s drought.
“Are we going to look at wells as our water source — or does it make more sense to go with bulk water?” Poulos said.
Any new wells would be drilled near the airport.
“It’s never a good time to raise rates, especially with the economy the way it is,” Poulos said.
However, both the water and sewage treatment budgets have been losing money and in 2013 will be using cash reserves held aside for emergency work.
The projected 2013 water revenue is $584,604 in the hole, and the projected sewer revenue is $785,106.
There are multiple reasons why the utility has seen costs rise.
Like the city, it saw a big peak in medical claims in the past year, making a possible $700,000 shortfall in the reserves from when the city was self-insured.
Costs for electricity, treatment chemicals and fuel keep going up, as they do for medical insurance.
The city lost revenue when its second biggest water user, Porter hospital, left. Its biggest user now is Cathay Pigments on the east end of town, Poulos said.
The slowed population growth since 2008 has also affected utilities income, and older parts of the systems need maintenance or replacement.
The utilities have saved $180,000 to $240,000 a year by combining into one department, and they’ve gone from 78 employees in 1998 to 64 now and could probably lose three more through attrition, Poulos said.
Although the utility department can pay its bills, it will have reserves of $325,004 for water emergencies and $368,290 for sewer emergencies.
Poulos would like to keep the reserves at $1 million each.
This year, unexpected work at Wood and Beech streets ran $559,000.
“It just takes two or three projects to erode these reserves,” he said.
The city most recently raised the utility bills from $9 to $12 a month in October as part of the trash fees, which pay for road improvements. They also raised water bills 15 percent in 2010 and 10 percent in 2011 to cover system improvements.