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Smithville aldermen: staff to pursue outside rate study before new water and sewer rates
Summary
At a April 29 work session the Smithville Board of Aldermen heard staff present a multi-year water and wastewater capital plan and recommended hiring an external consultant to review rates; the board supported the study and asked staff to schedule a follow-up session with HDR Engineers.
Smithville aldermen on April 29 reviewed a multi-year capital improvement plan for the city's water and wastewater systems and agreed staff should hire an outside consultant to reevaluate rates before adopting new charges.
Cynthia (city staff) told the Board the projects under the Water and Wastewater Master Plans will require multi-million-dollar investments and that debt financing and rate increases are likely necessary to fund them. She recommended issuing a Request for Qualifications to engage an external party to review the capital plan and rate models and to delay adopting any new rates until the study is complete; "we hope to have findings by the end of the calendar year," she said.
Finance Director Rick Welch presented nine-year cash-flow projections and financing scenarios showing a total planned financing of $53,500,000 under current projections, and warned that insufficient rate increases could force cuts to cash-funded projects. The presentation included alternatives with different annual rate-increase assumptions and projected end-of-year cash balances under each scenario.
Board members expressed support for a study that clarifies the facts. Alderman Hartman and Alderman Atkins called the study a sensible approach; Alderman Russell urged staff to examine multi-year, levelized spending (for example, spreading roughly $3 million per year over a decade) rather than lumpy, back-loaded spending that could produce large single-year rate shocks.
Cynthia clarified that the water and wastewater funds are self-supporting and not subsidized by tax revenue. Mayor Boley asked staff to schedule a focused work session on the Water and Wastewater Master Plans with HDR Engineers in attendance so the Board could examine engineering assumptions and timing.
The Board gave staff direction to pursue the RFQ for a rate study and to return with recommendations and a timeline for presenting results and any proposed rate changes.
