During Monday’s work session, the Spring Lake Board of Commissioners discussed a potential increase in water and sewer service rates and an adjustment to the deposit required for new utility customers, and received key updates on water and sewer projects and expenses in the town.
Finance Director James Overton presented a detailed analysis to commissioners. The increase in rates is necessary, he said, in order to generate funding for repairs to the town’s aging water and sewer infrastructure.
The proposed rate increase, which Overton said would need to be between 11-14% of the average Spring Lake residents’ monthly water and sewer bill, would provide assistance in two key ways. Town Manager Jon Rorie explained that the increase would allow the town to set money, about $500,000, aside as cash reserves. This rate increase would also allow for $500,000 to be used for “capital improvement” measures. Overton stated that capital improvement could include replacing some water and sewer lines within the town, as many of these lines are aging. Replacement of just one mile of water and sewer line comes at a hefty cost of $1.6 million, Overton said.
During the presentation, Rorie posed a hypothetical question, asking what would happen to the water and sewer system should the town forgo the replacement of these lines. “What happens if we don’t do that and we kick the proverbial can down the road?”
The system would deteriorate, Overton said.
Rorie proposed holding a public hearing at the next board of commissioners meeting on the possible rate increase in residents’ monthly utility bills. According to Overton, the average water and sewer bill in Spring Lake is about $109 per month currently. Calculating for an average 12% increase, residents could see their bills jump to around $122 monthly. Over the course of a year, the rate increase alone would cost customers over an additional $150.
Mayor Kia Anthony on Monday said while the news of rate increases is always intimidating, the town needs to take proactive action in solving the issues with water and sewer infrastructure to help lower costs in repairs and water lost to leaks within the system, and to provide a better quality of life for Spring Lake residents.
“We pay now, or we continue to pay more and costs increase exponentially.” Anthony said.
The board also discussed a proposed change to the deposit required for new utility customers. Currently set at $50 for homeowners and $100 for renters and tenants, the deposit would increase to $200. Overton explained that this adjustment is aimed at reducing the town’s risk of unpaid bills. Spring Lake currently holds over $1 million in debt from water and sewer accounts that are more than 90 days past due, Overton said, a record that stretches back decades.
In addressing why the town holds so much of this debt, Overton said that Spring Lake’s high renter population regularly moves away from the area, not providing forwarding addresses for bill collection. The state offers a debt collection service, where the amount in unpaid bills will be taken from an individual’s tax return. But individuals who owe these debts must still reside in North Carolina and must have provided their social security number when they set up their utilities, something that utility customers are not required to do, Overton explained.
Changes to both the deposit rate for new utility customers and the rate increase for monthly water and sewer services will be further discussed and finalized at the next board of Commissioners meeting.
The next Spring Lake Board of Commissioners meeting will be held at 6 p.m., Monday, Nov. 14 at Spring Lake Town Hall, 300 Ruth St.
