Rome, Georgia BURNING from Water Rate Increases Up to 600%: Small Businesses See Water Bills go from $15 to $100!!! (RomeNewsTribune)

Jan.22, 2009 in Public Works, Water Bills, Water Conservation, Water Crisis, Water Industry, Water Management, Water Rates

(Jan. 22, 2009, Rome News-Tribune)

Small businesses appear to be reacting with more concern than larger businesses to increases in the rates the city charges for “fire line services” on water bills.

For some, those bills have risen from double digits to triple digits. For a 6-inch water line — the most common diameter — the cost has risen to $100 from $15.

“I understand that water usage is down due to the loss of big business; however I do not feel that we should pass this to our small business owners who are struggling to keep our doors open,” said Debra McDaniel, owner of SuperKids and Kids World learning centers in Rome. “Childcare centers are regulated as to the number of staff we have on duty. We cannot pass these increases to our clients.”

She said she will have to pay an additional $200 a month.

But Robert Owens, chief financial officer with OTR Wheel Engineering, said he understands the city’s position. “The water department is like everybody else faced with declining revenue. They’ve got to make it up somewhere,” said “I guess even if it goes up, for us it’s not that significant.”

More than 300 Rome businesses have begun receiving letters from the city announcing the increase this month. The city has raised the rate to $50 from $9 for a 4-inch line; to $100 from $15 for a 6-inch line; to $160 from $24 for an 8-inch line; to $200 from $36 for a 10-inch line; and to $225 from $58 for a 12-inch line.

Those lines are used to feed sprinkler systems installed for fire prevention.

The letter said the city had not significantly increased the fees related to fire service for many years, that it had surveyed other cities, and the new rates are “comparative with the midrange of those cities.”

“You’ve got to keep in mind our system supports itself,” City Manager John Bennett said. “We don’t put any tax revenue into it.”

Bennett said the water department has taken steps to cut costs and that 13 positions had been eliminated through attrition over two years. But the city is taking in less revenue from water consumption.

“We sold less water last year than we have in the last 30 years,” he said. The city is still absorbing the closing of the Mohawk Industries dye plant in February 2007. The plant used about 1 million gallons of water a day and at the time accounted for 10 percent of the city’s usage, Bennett said.

He also attributed reduced usage to statewide watering limitations because of the drought in 2008.

The economy also has “a little bit to do with it” with businesses trying to cut costs, Bennett said.

Businesses and other organizations typically budget for expected increases in water usage rates.

“Our financial services department planned for the annual water and sewer increases, and those increases are in the current budget,” said Dennis Newby, director of plant facilities for Floyd Medical Center. “The increase for fire service was not included in the budget.

He said the water and sewer line item was under budget at the end of November. “We do not anticipate any budgeting issues this year related to the increase. The costs will be absorbed.”

The monthly cost at the hospital will increase to $160 from $24. At Floyd Behavioral Health center, the Medical Arts Center and the Floyd Corporate Support Center, the cost will increase to $50 from $9.

“With most businesses’ sales being down, not to mention those businesses that have closed, less water is being used, which means that the burden of overhead for the water department must now be spread over fewer units sold,” said David Newby, general manager of Profile Extrusion. He said in his market, the company cannot pass along cost increases.

The company has a 6-inch line, meaning its monthly cost will rise to $100 from $15.

John Massey of Massey’s The Diamond Store, was less stoic in his assessment of the situation.

“The city needs to find a way to adjust their finances rather than raising fees for those businesses out here trying to stay alive in this economy,” Massey said.

“I’m also concerned about arbitrarily raising fees based on what others charge. I don’t think that should be a basis for raising our fees. That would be like me comparing my diamond prices to prices in Atlanta.”

Click here to see a diagram of the city of Rome water bill.

(Original Article Here)