It has been 10 years since Star Valley water customers have seen a rate increase under Brooke Utilities.
But when the town takes over the system in January, customers could see their bills increase 20 percent or more and the local fire district could face new fees.
That is because the town says it plans to upgrade and maintain the system, something it claims Brooke has not done in years. In addition, the town says new taxes are increasing water costs everywhere.
The town has not set a final rate structure and the public still has time to comment at several upcoming public readings. The rates could go into effect as early as mid-January 2012 if the sale is finalized by that time.
Star Valley Councilor Vern Leis, who worked on the proposed rate structure for months, said it is “not a tremendous increase.”
For 84 percent of customers that have a 5/8” meter, bills will see an increase from roughly $25 a month to $30. This does not include a new Star Valley imposed $1.50 transaction fee or various taxes, which the town does not set. With those included, the bill increases to $33 a month without standard taxing.
Compared with other water systems, the new rates are on par, he said.
“The system that we are acquiring has not had a rate increase over the last 10 years, meaning the rates you are working with right off the bat are no place close to reflecting inflationary rates or the impact of what’s happened to the rest of the world,” he said.
To run the system professionally, the town needs money for upgrades, he added.
In addition to raising rates for some 360 customers, the town says it plans to charge the Hellsgate Fire District.
Besides paying a water bill at the station, Hellsgate has never paid Brooke Utilities for water to fight fires or for training.
The town has proposed a fixed annual cost to Hellsgate of $14,000. This includes $11,500 to help run a pump in a Knolls tank house and quarterly maintenance of the pump.
The fire district would also pay $2.23 per 1,000 gallons of water used.
Reacting after the meeting, Hellsgate Chief Gary Hatch said he does not believe the town can “gouge us like that.”
Hatch claims the district rarely uses water from the pump house and furthermore, he does not believe Leis’ figures are accurate.
Leis says the pump has a monthly $1,200 electric bill.
“That pump does not cost $1,200 a month to operate,” Hatch said.
The pump maintains line pressure for the Knolls area and four hydrants and kicks on when demand exceeds 300 gallons a minute, Hatch said.
Last year, Hellsgate used less than 15,000 gallons to fight fires and for training.
“We use less water to fight fires in this area than a standard house does in two months,” he said.
Still, at Tuesday’s council meeting, most councilors were surprised to hear Hellsgate has not paid Brooke for water.
Hatch said he would have no problem paying Star Valley for the water, but he contests paying 80 percent of the electrical bill for the pump.
Using Star Valley’s proposed rate of .00223 per gallon, Hellsgate would pay just $33.50 for 15,000 gallons.
Hellsgate is not the only one facing new fees.
Water customers will see their monthly bills increase as well as auxiliary fees for such things as a meter re-read, meter testing and service calls.
Leis said he looked at 18 water system rate structures throughout the state and drew up the proposed rates using a combination of information. The rates are competitive with most other water companies, he said.
The monthly service charge will cover meter maintenance, billing costs and enhancements to the reliability of the infrastructure.
On Tuesday, the water in part of the Knolls went out. While it was back on the same day, Leis and Mayor Bill Rappaport said it was because they called Brooke President Robert Hardcastle directly.
Normally, customers contact a call center in Costa Rice, with customer service intermittent, said Town Manager Tim Grier.
With Star Valley in charge, customers will only have to call town hall to get help.
Last year, Brooke sold 19 million gallons in Star Valley to 362 customers. Amortizing what Brooke has sold through September 2011, and the company will sell 22 million gallons of water this year, a 12.4 percent increase.
With some customers only part-time residents, Leis suggested a $125 fee that includes shutting off the water while the homeowner is gone and then reconnecting it.
Councilor George Binney predicted few would pay that fee and that most will leave their water on and just pay a monthly bill.
Other fees Leis is suggesting include:
• $35 service establishment fee (for new customers)
• $75 security deposit for a 5/8” meter
• $35 for service re-instatement, $50 after hours
• $20 for non-sufficient funds payment
• $30 for field meter testing (Not applicable if the meter is broken)
• $25 for a meter re-read (Not applicable if meter is reading wrong)
• $25 turn off fee
• $25 for a service call, $75 if after hours
Leis had suggested charging renters a larger security deposit for a meter, but the council threw out that idea saying it was discriminatory.