Franklin finance director explains water rate hike

The City of Franklin has committed to finding solutions to its infrastructure problems and to improving the 100-year-old water distribution system throughout the city, Mayor Eugene Foulcard told the Franklin City Council at its Sept. 19 meeting.
But that work comes at a cost, and that includes an increase in the cost of water services to the public, city financial director Edward Hay said.
“Based on the calculations that we’ve done, we’re actually going to have to raise our water rates from $11 per thousand (gallons) to $13 per thousand to be able to keep up with the increased costs,” he said, “and also afford us an opportunity to continue to improve the (water) plant.”
The city has received state funding to change the water filters that process the water coming into the water plant, and received some funding to change some of the older water lines that have deteriorated, rather than continually repairing those older lines, he added.
“This administration has committed time, effort and dollars to begin working to rehab our system,” Foulcard said. “The old saying goes, Rome didn’t fall in a day, and it won’t be rebuilt in a day. But I want to make the public aware that we are working hard each and every day find solutions to our infrastructure problems and make our water system better for the entire city.”
Foulcard asked Hay to explain a city water rate study to the council and those attending the meeting.
“One of the things that the department of health and the legislative auditor recommends strongly is that water producers should at least once a year do what they call a rate study,” Hay said.
The Rural Community Assistance Partnership Guide to Conducting Rate Studies for Small Water Systems was used as a guideline.
“Basically what we do is look at how much water are we producing, how much water are we billing, how much of what we bill are we collecting, and all those factors go into determining a forward path on revenue side,” Hay said. “The other side of it is you’ve got to look at what you’re doing in the (water) plant, how the plant is structured, and the chemicals that you use, and trying to get those things in proper balance, and projecting forward your revenues and projecting forward your expenses.”
One of the things the study indicated was there has been a 30 percent increase in the cost of chemicals, not through any changes made but in cost increases for suppliers. The city also is facing a transportation charge because of increased fuel costs.
“We’re looking back on three years of prior activity, and we’re using that to project future activity, and then we’re putting in an estimate of what we see as an increase that may occur over the next three to five years,” he said.
Those numbers are entered into a spreadsheet that produces suggested prices for the coming year, which led to the need for an increased water rate.
Hay noted that though the city is receiving some state funding for the infrastructure work, the state expects the city to match some of those funds, which has led to some bond issues the city has proposed. Even with increased costs, residents are getting a good deal on their water needs, he said.
“When you look at what you pay for bottled water, believe me, the water in Franklin is really a good bargain,” he said.
Foulcard said one of the things he has been passionate about is not kicking the can down the road, but addressing ongoing infrastructure concerns as they arise.
“I know that it has been difficult in the past to secure the funding,” Foulcard said. “We have been very aggressive with going at whatever funding is available to address those concerns. We have very stringent requirements that we are held to. In light of the Flint, Michigan, debacle, and another incident in Jackson, Mississippi, now municipalities are held to a higher standard to ensure that standards are being met, that good water is being dispensed throughout the city, but we can’t do this without taking small bites out of the elephant, as I’ve always said.”
Hay is good at crunching the numbers to come up with solutions, the mayor said, but he doesn’t want to see someone in the future have to address the situation because the city hasn’t addressed those issues now.
In other business, the council passed a resolution of respect for the late Dr. Thomas Frére Kramer in appreciation for his contribution to Franklin and its citizens, and extending sympathy to his family and friends.