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Cherry Valley approves ordinance to raise water and sewer minimums, discusses loan and grant options for tank repairs
Summary
The Cherry Valley council approved Ordinance 197 to set a 3% annual adjustment to water and sewer rates, raising the minimum (the '1000st') to $31.11 and the next 1,000 gallons to $11.70; council also discussed loans and grant timelines for a water tank project.
The Cherry Valley City Council approved an ordinance to amend water and sewer rates and discussed financing options for a water tank and system repairs.
Council members voted to adopt Ordinance 197, described during the meeting as "an ordinance amending the water and sewer rates to the city of Cherry Valley, Arkansas, providing for an annual 3% adjustment to such rates, repealing conflicting ordinances to the extent of any conflict and for other purposes," according to the reading presented at the meeting.
The ordinance changes the minimum charge (the '1000st') to $31.11. Council and staff explained that the next 1,000 gallons would be billed at $11.70, meaning a household using 2,000 gallons would see a combined water charge of $42.81; the sewer minimum discussed was $30.90. During debate, staff noted the town has been placed on a state distress list and that the rate study used to set minimums now factors in the system's indebtedness.
The council discussed alternatives to reduce impacts on customers, including raising the minimum to 1,500 or 2,000 gallons in the future if the system shows consistent surpluses. "If we understand that the balance is going up and is consistent, maybe we could come in and raise the minimum for 1,500 or 2,000," the chair said during discussion.
If grant funding to repair the water tank does not come through, staff described loan terms presented by a vendor: an estimated monthly obligation in the range of $2,600 to $2,900 for a 30-year loan at about 3.25% interest. Staff emphasized that added debt would increase the indebtedness component used in the five-year rate study, which could push minimum rates higher in future reviews.
The ordinance reading was followed by a motion and a vote in which council recorded "all in favor." The council did not specify individual roll-call votes in the meeting transcript.
Looking ahead, staff said they will monitor water department balances and grant outcomes before recommending any change to the minimum usage level.
The council also discussed related budget line items and meter-set charges when considering the municipal water budget. The ordinance was read as Ordinance 197 and approved during the meeting; further administrative steps and implementation timing were not specified at the meeting.
