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Council reviews sewer- and stormwater-rate changes to finance Midwest Industrial Park upgrades
Summary
City staff and an outside financial adviser presented a rate study proposing a series of sewer and stormwater increases to fund immediate sewer upgrades for the Midwest Industrial Park; council voted to read the ordinance by title and refer rate work to the finance committee for second reading.
The Richmond City Council on Aug. 4 heard a detailed presentation on proposed sewer- and stormwater-rate increases intended to fund sewer upgrades serving the Midwest Industrial Park and other capital needs.
The proposal, presented by Pat of RSD and Corby Thompson of Cronin Associates, would support design work already started and finance construction of two immediate sewer segments while creating capital reserves for a third segment planned in 5–15 years. Pat said, “Before you, this ordinance is a rate ordinance. The driving portion of this was the Midwest Industrial Park.”
The meat of the plan is a revenue-requirement schedule that Cronin used to calculate needed rate changes. Corby Thompson, a financial adviser with Cronin Associates, told the council the district needs to meet debt-coverage and capital requirements to issue bonds and to avoid large future “rate shock.” He said the city implemented a 5.75% increase earlier this year and that the study shows additional increases that, in the adviser’s scenario, amount to roughly a 36% series of…
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