At Monday’s meeting, the Spring Lake Board of Commissioners unanimously approved increases to certain charges for the town’s water and sewer customers, including late and cutoff fees and deposits.
The approval came after commissioners were presented options for generating revenue to reduce the town’s debt and make repairs to water and sewer systems by Spring Lake Finance Director James Overton. Let’s break it down.
Deposit increase
Currently, Spring Lake homeowners pay a deposit of $50 when establishing their services, while renters pay $100. In a previous meeting, town officials expressed concern that, should a customer leave town without paying their last month’s dues, this deposit would not cover a single month of water and sewer services.
To combat this, Overton proposed raising the water and sewer deposit for future customers to $200, which would cover any unpaid balances and reduce the town’s often uncollectable debt. During a previous meeting, Overton explained that Spring Lake’s debt from water and sewer accounts is attributable to unpaid bills and a high renter population that regularly moves away from the area without providing forwarding addresses for bill collection. The debt from those accounts is over $1 million, Overton said at an October board meeting.
Notably, the deposit increase recommendation will only affect new Spring Lake customers, grandfathering in customers who have already paid their deposits at the lower rates. The board unanimously voted in favor of the deposit increase.
Late fees and cutoff fees
Commissioners voted unanimously to both maintain the town’s current $25 charge for those who pay their water and sewer bills late. The board also moved to double the cutoff fee — a fee that the town charges to reinstate services that have been shut off due to delinquent payments — from $25 to $50.
In addition, this measure stipulated that customers who appear on the cutoff list a total of three times would have to begin paying their water bills in advance. Prepaid bills would be calculated by the average amount owed over the previous six months, rounded up $10. For example, if the average bill for a customer who found themselves being required to prepay was $85, their bill would be rounded to $95 on the prepay system.
Rate increases
Spring Lake’s water and sewer fees work on a stepped system. The town’s residents each pay a minimum flat rate for water and sewer services, plus a usage charge that is measured per 1,000 gallons. Currently, monthly minimum fees for water and sewer services are just over $9 and $17 respectively, while usage fees are about $8 per 1,000 gallons used for the first 3,000 gallons.
In order to generate additional revenue, which town officials say would be necessary to perform repairs on Spring Lake’s deteriorating water and sewer systems and to reduce debt, the town would need to hike both rates by 17%, according to Overton.
To clarify the recommendation for these increases, Overton presented the board with their own water and sewer bills, and adjusted them to illustrate what a sample bill may look like after increasing the rates. A bill of $43 would increase to about $51 per month, while a higher bill of $121 would jump to around $149.
Commissioner Marvin Lackman said he was “not ready to vote on this” during Monday’s meeting, and the board motioned to table this issue for later discussion.
