Edinburgh Water customers add $10 per month

Customers of Edinburgh Town Water are about to hike rates.

Rates for residential customers will increase by an average of $10.31 per month.

Town officials say additional funding is needed to fund a new $6.5 million water plant that will upgrade a 1997-built water plant that was supposed to be more than five years old.

Mitchell Eschweiler of Baker Tilly, an accounting firm hired to do the rate research, said the total cost of the new plant was $8.1 million, including construction costs, design, engineering and bond financing.

To reduce the overall cost of the new plant, the town council plans to use the town’s $956,500 grant from the American Relief Program and a $700,000 grant from the Indiana Office of Rural and Community Affairs. The grant was awarded to the town last year, and the council is expected to distribute ARPA funding at its March 28 meeting.

Town manager Dan Cartwright said the rest of the project is funded by a $6.4 million state revolving fund (SRF) loan that will be paid off in 2042.

Eschweiler proposed several rate hike scenarios and touted the highest possible rate hike for a March 28 public hearing.

The maximum ad average increase of $12.02 may be higher than the amount ultimately approved by the city council because that figure does not include ARPA funding. Cartwright said the average rate for residential customers would be $10.31 higher if ARPA funds were included.

The initial scenarios are average increases of $12.02, $10.12, and $7.28. Cartwright said that with the increase in ARPA funding, the increase will be a few dollars lower than originally proposed.

These scenarios are based on water users with an average monthly water consumption of approximately 4,000 gallons. Those customers currently pay an average of about $31 a month in bills, so if council approves an increase in the maximum rate, they will pay about $41.31.

Eschweiler said the rates would increase the water utility’s operating expenses, provide enough money to meet the bond’s requirements and raise $1.6 million to $1.8 million for future water infrastructure improvements.

Even with the increase, the town’s water bills are lower than comparable utilities. According to town documents, a survey of nearby rates shows Edinburgh’s current rates are lower than in all but one community, and the proposed rates would put rates in the middle.

While the rate hike isn’t ideal as gas prices and inflation continue to rise, the town’s water is past its useful life. Now, Cartwright said, the utility pumps thousands of people with sodium permanganate for maintenance and water treatment.

Cartwright said the new plant would save on maintenance costs and eliminate the need to add sodium permanganate to Edinburgh’s water. The discoloration that plagued residents in 2020 occurred because the current plants were no longer able to effectively clean iron and manganese due to outdated filtration systems.

“Just over a year ago, the entire community was shocked by brown water,” Cartwright said. “We’ve been helping an existing water plant for years. We dug new wells, we tested the water. Today our water is fine, but we’re helping a very, very old water plant with a Band-Aid to do it at this point.”

Town officials said that while the increase was not desirable, it was inevitable.

“A $10 increase is tough in today’s world, but we’re also going to get a brand new water plant that won’t have any more rust issues and will probably serve the community for the next 30 years,” said town council member Ryan Piercefield .

Edinburgh water director Bill Jones said last year that the plant would also increase the town’s current daily processing capacity from 1.4 million gallons to 2.1 million gallons, with the ability to expand to 2.8 million gallons with additional filters and pumps. With current water usage around 700,000 gallons per day per day, there is plenty of room for growth in commercial, industrial and residential, he said.

The old factory at 308 N. Walnut St. will remain on site and converted into a warehouse. The new plant will be built next door and will continue to draw the town’s water supply from a groundwater well also on site, Jones said.

Council is expected to decide how much to raise the tax rate at a town hall meeting at 107 S. Holland St on March 28 at 6 p.m. The city council will hold a public hearing before approving the rate, meaning anyone with questions or concerns about the rate can raise it with the council.

City officials will close bonds in a few days on March 31 to lock rates lower ahead of the Fed’s planned rate hike the next day.

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