Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Utility Rates topic
No spam. Unsubscribe anytime.
Neosho work session previews water and sewer rate increases to fund major wastewater upgrades
Summary
City staff told the Neosho City Council at a budget work session that proposed water and sewer rate increases would fund a roughly $27 million, multi‑phase wastewater project, boost reserves and meet debt‑coverage requirements; formal adoption will be considered at an upcoming council meeting.
City staff presented proposed changes to Neosho’s utility rates at a budget work session, saying the increases are intended to cover debt service and long‑term capital needs for the water and wastewater systems.
A staff presenter (identified in the transcript as Speaker 3) said two previously applied‑for grants — one tied to drainage and one tied to wastewater (Buffalo Creek) — were denied and the budget has been updated to remove those revenues and associated drainage expenses. The presenter reported utility fund balances of about $6.5 million at Sept. 30, projected to end the year near $7.3 million and proposed in next year’s budget at about $7.7 million. After restricted reserves are accounted for, the presenter said unrestricted operating funds would be roughly $946,000, or about 58 operating days; auditors generally look for 60 days.
On water rates, staff outlined a modest increase in the base and volumetric rates: a cited current base of $11.37 moving to $13.97 under the proposal. Staff said that calculation uses a 2.3% CPI figure and includes adjustments for debt‑service coverage and reserves.
The larger change applies to sewer. Staff described the proposed sewer base moving from $16.90 to $23.50 and the volumetric charge from $5.33 to $7.85. Staff provided revenue projections: current annual sewer revenue of roughly $3.6 million rising to approximately $5.276 million under the proposal. The increases are intended to support a multi‑phase wastewater program to retire the older Crowder trickling filter plant, route flows to Shoal Creek for treatment, and address priority capital needs that staff estimated at about $27 million across phases.
Staff said the proposed increases also raise debt‑service coverage ratios from minimum levels toward a target in the 1.3–1.6 range and add to maintenance and operating reserves. One council member summarized the proposal as covering COLAs, reserves and primarily the financing costs of the wastewater project.
Council members asked about CPI timing (Alliance uses a July CPI pull at 2.7%, staff used an April/May 2.3% figure) and about SRF loan terms; a council member quoted an SRF interest example of about 1.565% and staff said projected rates might rise slightly if borrowing is not immediate. Staff repeatedly said the city is pursuing grants and low‑interest loans where possible but that the $27 million project will drive much of the rate increase.
No vote on rate adoption occurred at the work session. Staff told council the proposed rates and related budget documents will be included in the packet for the next council meeting, where formal consideration and any vote would occur.
