The Norman Transcript

Government

July 11, 2013

City crunches sewer numbers

NORMAN — Norman needs to raise about $2.8 million annually to make $63 million in upgrades to the city’s south wastewater treatment plant. City leaders anticipate asking voters to approve a rate increase in November to pay for those capital improvements.

“The last rate increase we had was in 2001, and we’ve spent about $80 million in investments in our system since then,” Mayor Cindy Rosenthal said. “We have to put a rate proposal before our voters.”

A public forum is planned for August to get input on the rate hike.

Utilities Director Ken Komiske said all of the options currently under discussion would result in a rate increase of about $7 a month for average-use customers.

The current focus is on the existing south wastewater treatment plant because Department of Environmental Quality requirements are driving some of the upgrades. Norman is under a consent order by DEQ and could face thousands of dollars in fines if regulations are not met soon.

Aging equipment also will be replaced and capacity expanded as part of the project.

Currently, Norman’s sewer rates are lower than 15 comparable cities.

“We do run a lean shop, and our rates are extremely low compared to our sister cities,” Komiske said.

However, low rates mean aging equipment has not been replaced, he said.

Of the $63 million needed for the project, only $38 million will need to be raised through the rate increase. Wastewater excise tax funds will pay $25,641,000 — about 40 percent — of the project.

The $2.8 million annual increase estimate is based on a 4 percent loan paid over 20 years. Some of the bond money should be available at low interest through the Oklahoma Water Resources Board’s State Revolving Fund.

This is a very large project, however, and the city may not be able to finance the total bond through the OWRB because available funding is limited, Komiske said. That could mean higher loan rates for privately financed bonds.

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