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Water meter change tops project list

Thursday, September 8, 2011

Water improvements recommended

Priority for the next one to two years:

* planning for new well, $100,000

* increase high service water pump capacity, $270,000

* new water booster station for southeast Le Mars, $700,000

* change water meters, $800,000

* add new water tower, $2.6 million

Total $4.4 million

Priority for the next three to five years:

* new well at south wellfield, $590,000

* new water main at south wellfield, $610,000

Total $1.2 million

Source: McClure Engineering

Planning is underway to keep water flowing to Le Mars citizens and businesses and to pay for needed improvements.

A McClure Engineering study of what the city needs to do to insure a successful water system for at least the next 20 years was reviewed by the Le Mars City Council Tuesday.

The city water department serves 4,000 customers, including 3,600 residential customers.

The study includes what improvements need to be made, when they should be made, ways to pay for them and what water rates are needed to pay for the projects.

Five priorities identified as projects within the next year or two include planning for a new well, changing water meters to a radio-read system and adding a water tower, according to the consultant's report.

The cost of the work is estimated at $4.4 million.

Of that amount, changing water meters to a system which can be read automatically is estimated to cost $800,000.

City Administrator Scott Langel said the meters would be purchased through bids for the style and features the city chooses and installed by water department employees over three years.

He recommended the council set Sept. 20 as the meeting date to hear comments about the meter project and paying for the change.

"City staff will review the reasons why we're proceeding with the metering project and the advantages of going to automatic meter reading," Langel said.

Another improvement project, the new water tower, is slated for construction in the fall of next year.

A location for the 1-million gallon water tower has not been selected, Derick Anderson of McClure said. Options include the southeast part of the city due to low pressure or the western side due to future growth.

McClure's study also recommends improvements in the next three to five years that would add a new well and water main at the city's south wellfield at a cost estimated at $1.2 million.

Increasing water rates over the next five years to pay for the improvements will also be discussed by the council.

"The water utility does not have enough money to fund the future capital improvements," Anderson said.

The consulting firm recommended water rates be increased 5 percent each year for five years.

"An average typical monthly customer who uses about 5,000 gallons of water would see their bill increase from the current rate of $17.65 a month to $22.55 a month over five years," Washburn said.

Councilman John Rexwinkel asked how a 5 percent increase would impact small water users.

Water customers who use the minimum amount, up to 2,000 gallons per month, would have rates change from $11.20 per month to $14.30 per month over five years, Anderson said.

"That water use would cover most two-person households, if not some three-person households," he added.

A higher 10-percent increase is proposed for industrial customers who use more than 169,000 gallons of water a month.

The study indicated those larger water users currently provide about 30-35 percent of the water system revenue and use 50-60 percent of the water produced.

"We've got to make sure we're giving those gallons out at a rate that at least covers our cost," Langel said.

McClure also recommends two categories of water rates be combined.

"In order to simplify the current rate structure and lessen the financial incentive for lawn irrigation, it is proposed that rates for water use from 2,100 gallons to 14,000 gallons a month be combined with the rates for 14,100 gallons to 34,000 gallons per month," the report stated.

The result would be a sale of water at a higher rate which is the current 2,100 gallons to 14,000 gallons per month.

Water rates are one source of income for the improvements McClure is recommending.

Others include a State Revolving Fund (SRF) program for water projects would finance the meter project. The program features a 20-percent forgivable loan.

The consultant is also projecting $500,000 from Tax Incremental Financing (TIF) to keep the residential rate increase at 5 percent, Washburn said.

Water system improvements and financing will be discussed at council meetings through mid-November.

"I'd recommend we carry it over the next couple of months to make sure that people who want to dive into and learn about it can do so," Langel said.

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$800,000 dollars to replace the water meters? Why? Sounds like we need to get a second opinion.

-- Posted by Baddog on Thu, Sep 8, 2011, at 10:01 PM

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