Thursday, Jul. 03, 2008
Grapevine May Increase Water Rates
Utility Bills Have Not Changed Since 1999, But Costs Are Up
By Scott Price
Staff Writer
The city of Grapevine awarded a $53,000 contract recently to J. Stowe and Company to conduct a water and wastewater cost-of-service and rate design model. The city, which has not adjusted the rates since 1999, will use the information in deciding whether to increase water and sewer rates.
The city of Grapevine currently charges $9.75 for the first 2,000 gallons of water and $7.80 for sewer with the first 2,000 gallons of water. After that, it is $2.74 for each thousand gallons of water, and $3.26 for sewer with each thousand gallons of water.
"I’m not necessarily suggesting that we raise the rates, but we should look at it," said Grapevine Public Works Director Matt Singleton.
In 2004, the city hired the engineering firm of Freese & Nichols to conduct an analysis of utility rates. That study recommended that the city increase utility rates by 2005, which did not happen.
Two issues resulted in the postponement of a rate adjustment.
The city had expected a $13 million capital investment to build a booster pump to provide treated water from the Trinity River Authority at the adequate pressure. TRA improvements made the booster pump unnecessary.
In addition, the dry year in 2006 boosted city operating revenue, because of increased water usage.
Now the city is expecting significant capital investment in association with utility relocations from the DFW Connector [Funnel] project. The exact costs are not available, but city officials estimate it will cost about $15 million
Operational costs have also increased over the past few years and are continuing to increase. Electricity costs have also doubled since 2006, and the cost of chemicals to treat drinking water has increased more than 15 percent, city officials said.
The study by J. Stowe will enable city officials to more accurately assess the impact of these costs on the city’s finances. A typical study estimates costs and revenues for three to five years.
City staff can then update the prediction model each year for several years.
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