In most places, municipal utility rates only go in one direction: up.
No one should hold their breath yet, but Findlay may be in such a strong budget position that residents and businesses could owe less, not more, when their water and sewer bill arrives in the future.
Reducing water and sewer rates is something the administration and City Council should seriously consider as they prepare the 2018 budget.
Make no mistake, the city’s financial situation is still in a place where many communities would like to be.
City operating expenses had been expected to outpace revenue by about $1.2 million this year, but Auditor Jim Staschiak said at last week’s pre-budget planning meeting that the city’s year-end carryover balance may actually increase slightly over the 2016 carryover, which was $12.4 million.
That would be nearly half of Findlay’s operating budget of $27.6 million for this year.
Of particular note, Staschiak said large, year-end projected cash balances in both the city’s water and sewer funds give council “an opportunity for a rate reduction or significantly expanded, fully-planned and executed capital program.”
The balances in both funds are well in excess of the city guideline of keeping a minimum of two months operational costs in reserve, and would pay for a year of water and sewer operations if they could be combined.
The city’s water fund, which is expected to end the year with a balance of $9.1 million, will cost about $6.6 million to operate this year. Meanwhile, operation of the sewer system will cost about $7.5 million this year but is expected to finish 2017 with a balance of $6.6 million.
That means the water and sewer funds will have a combined $15.7 million on account.
Staschiak, who has long advocated for long-term planning, says the infrastructure of the city’s water, sanitary sewer and storm sewer systems is in need of a full study and a five-year improvement plan. The city’s water and sewer “model” has not been updated for more than two years.
City department budget hearings will be held Dec. 13 and 14, and the large unspent appropriations in the operations and capital budgets should lead the administration and council to establish a policy for acceptable amounts to have on hand.
Council should also follow the auditor’s recommendation to study the water and sewer operations and bring the city’s pipe model up to date while the favorable budget allows for it.
Water, sewer and storm pipes may be out of sight, but should not be out of mind.
If the study can’t identify critical infrastructure needs, the council should do the hard-to-imagine, but right thing: decrease water and sewer rates for all city customers. That would be a fitting reward for the taxpayers of the nation’s top micropolitan community.