Sewer utility to raise rates for Little Rock clients; 4.75% increase approved as part of $109.1M budget

Little Rock Water Reclamation Authority customers will again see higher sewer bills in 2019.

The authority's governing commission last week approved its budget for the coming year, which includes a rate increase of 4.75 percent. The increase was approved by city directors in 2015. Rates rose by that percentage last year and this year, and will increase by that percentage each year through 2021.

The utility -- the sanitary sewer service provider for the city of Little Rock -- considers an average residential customer to be one with a monthly wastewater output of 600 cubic feet. That customer would have paid a monthly sewer bill of $36.31 this year, which will increase to $38.03 in 2019. That cost includes a city sales tax.

Revenue and expenditures are both projected to increase at the authority next year, according to a $109.1 million budget that the Water Reclamation Commission approved last week.

Of that, $28.2 million comprises operation and maintenance expenses, up $652,968, or 2.4 percent, from this year.

It has been a goal of Chief Executive Officer Greg Ramon's to keep each year's operating budget within 2 percent of the previous year's since he arrived in 2014 at the utility, formerly known as Little Rock Wastewater.

The utility has budgeted to spend $43.6 million on capital projects required under a Consent Administrative Order that demands that sewer overflows in the city be corrected by 2023. The utility celebrated a year without an environmental violation in 2017.

The projects planned for 2019 include collection system improvements, upgrades to Little Rock's first wastewater reclamation facility on Temple Street, and rehabilitation at the Fourche Creek facility.

Administrative costs will go up again next year to allow for the expansion of the utility's public education and community outreach programs, as well as to expand advertising nationwide for contractors and engineers.

New programs, including the implementation of a career service award for employees that's based on years of service and performance, also contribute to a larger operating budget, said Debbie Williams, the utility's chief financial officer.

All employees will receive a 3 percent salary increase in 2019. Health insurance premiums are increasing by 4 percent, compared with 2018's 7 percent increase.

Revenue is projected to increase by 5.2 percent to $60.9 million in 2019, due in part to the increasing rates. An increase in the net volume of solid waste that the utility treats before it goes to landfills is also expected to contribute to higher revenue, Williams said.

The annual increases are expected to raise a total of almost $213 million in new revenue for the sewer utility. That revenue funds projects to meet the Consent Administrative Order, implement regulatory changes to treatment plants and inspect the sewer system's large interceptor lines.

When calculating the average residential sewer bill, the utility multiplies the rate per 100 cubic feet by six, to represent the average usage of 600 cubic feet, then adds the service availability charge or base rate.

For 2018, the average bill inside the city limits is six times $4.17, plus $11.29. For 2019, the average bill inside the city limits is predicted to be six times $4.37, plus $11.81 -- an extra $1.72 per month.

The commission unanimously approved the 2019 budget.

The utility serves the city and has 69,410 customers.

Metro on 12/17/2018