Danville water customers to get 7% rate increase

Published 9:16 am Friday, July 29, 2022

FIONA MORGAN

fiona@amnews.com

Danville Municipal Utilities recently announced a 7% increase in water and sewer rates for all utility customers. The increase is a cost of living adjustment (COLA) in line with the state’s COLA rate due to national cost of living increases.

An article in the previous edition details why the 7% increase is happening. It also details a memorandum of understanding recently signed that says Boyle County will give almost $3 million of ARPA funds to Danville Utilities for upgrades to pump stations in Perryville and Junction City.

Water and sewer rates in Perryville and Junction City are a major concern to residents. The ARPA funds will result in a 5% sewer rate reduction for those cities.

According to a letter to the Advocate-Messenger written by Judge Executive Howard Hunt, Junction City Mayor Jim Douglas, and Perryville Mayor Carlos Miller, they had originally planned that the contract would include that the 5% rate reduction would hold for the next 20 years.

However, the ARPA funds will only pay for pump station repair expenses, which will not have to be repaired again for at least 15 years. Monthly operational costs may continue to increase rates over 20 years, as evidenced by the COLA increase.

When Danville purchased Perryville and Junction City water and sewer systems in the early 2000s, a ‘penny for penny’ rule was added to the purchase contract to ensure rates would not be increased at an unfair percentage rate. However, this rule is only for water rates and not sewer.

The purchase contract states, “The purchaser represents and warrants that future increases to the water rates charged to the current residential and commercial water customers of the seller will be tied directly to raises imposed on the resident customers of the City of Danville with increases to be measured on an absolute dollar/cubic foot basis and not as a percentage.”

A letter released by the city of Danville explains, “For instance, if a bill in Danville is $10, the COLA will be $0.70. However, if that same bill based on usages is $20 in Junction City or Perryville, the COLA will still only be $0.70 to be penny for penny with Danville’s COLA increase, meaning the increase is merely 3.5%.”

The actual cost increase is a little more complicated, however, because bills are based on a declining block rate of usages measured in cubic feet.

The exact increases for water in the city of Danville for residential and commercial customers are as follows. These numbers were provided by the City of Danville Utility Department.

WATER

Consumption in cubic feet (cft) rates for the previous year vs. upcoming year:

• First 100 cft – $9.30 increasing to $9.95

• Next 200 cft – $3.10 increasing to $3.32

• Next 1,500 cft – $2.32 increasing to $2.48

• All over 1,800 cft – $1.97 increasing to $2.11

The penny amount increase in Danville is the same penny increase for the other cities. As an example, the increase of 65 cents for the first 100 cft in Danville is also 65 cents for the first 100 cft in Perryville and Junction City.

The exact increases for water in the cities of Perryville and Junction City for residential and commercial customers are as follows.

Consumption in cubic feet (cft) rates for the previous year vs. upcoming year:

• First 100 cft – $14.85 increasing to $15.50

• Next 200 cft – $4.95 increasing to $5.16

• Next 1,500 cft – $3.70 increasing to $3.86

• All over 1,800 cft – $3.15 increasing to $3.28

The minimum monthly rate plus sewer is the same as the cost of the first 100 cft.

Monthly water rates for industrial consumers are as follows.

Consumption in cubic feet (cft) rates for the previous year vs. upcoming year:

• First 20,000 – $734.83 increasing to $786.27

• Next 80,000 – $3.31 increasing to $3.54

• Next 100,000 – $2.98 increasing to $3.19

• Next 300,000 – $2.43 increasing to $2.60

• All Over 500,000 – $1.35 increasing to $1.45

SEWER

The monthly sewer service charge for Danville residential and commercial consumers:

• Minimum Monthly – $5.42 increasing to $5.79

• Per 100 cu.ft. of water used – $4.87 increasing to $5.22

The monthly sewer service charge for Perryville Utility residential and commercial consumers:

• Minimum Monthly – $4.44 increasing to $4.75

• Per 100 cu.ft. of water used – $13.69 increasing to $14.65

The monthly sewer service charge for Junction City residential and commercial consumers:

• Minimum Monthly – $4.44 increasing to $4.75

• Per 100 cu.ft. of water used – $10.14 increasing to $10.85

The monthly sewer service charge for industrial and wholesale consumers:

• Minimum Monthly – $5.42 increasing to $5.79

• Per 100 cu.ft. of water used – $10.73 increasing to $11.48