Esky may see more utility rate hikes
ESCANABA — Residents may not have seen the end of rate increases, according to Escanaba Water and Wastewater Superintendent Jeff Lampi, who expects to hold multiple work sessions with the city council as the city’s budget process moves forward to address shortfalls and unexpected costs.
“I kinda skipped the one, two, and three priorities,” Lampi told those in attendance at a special joint meeting between council and city department heads to discuss budget needs Thursday. “My third priority is that I would like everything to disappear.”
Last June, the city approved a 45 percent increase in water rates, increased the water availability charge, and eliminated discounts for consumers that used large amounts of water, such as some industrial businesses. It also rolled out the first of three annual 20 percent increases to wastewater rates and increased the monthly availability debt service charge for sewer access above the prior fiscal year’s levels.
While both increases were instituted at the same time, the money was earmarked for different projects. The water increases were to pay for line replacements mandated by the Michigan Department of Environment, Great Lakes, and Energy (EGLE) in an effort to reduce lead in water supplies. The wastewater increases were to fund major improvements to the city’s wastewater plant and reduce discharges into Lake Michigan.
Under the EGLE rules, cities must begin removing lead-contaminated service lines starting next year. Any line that is or was formerly downstream of lead is considered contaminated under the rules, regardless of whether or not lead can be found in the water in high concentrations. In Escanaba, that means roughly 80 percent of all lines in the city — more than 4,500 individual lines — must be replaced over the next 20 years despite lead levels in the water being well below what was previously considered acceptable.
The issue is further complicated because EGLE mandates the city to replace service lines all the way to the meter, which is typically located inside a home or business, on the city’s dime. Historically, the city has not been responsible for any lines located on private property.
While the additional work will raise costs, Lampi believes the city can save money by hiring additional wastewater employees rather than hiring contractors to do line replacements. However, the rate increases passed last year have had an unintended effect on the department’s bottom line that could limit what the workers can do.
“Unfortunately, our sales are down. I don’t really know exactly what our numbers are, but I don’t think it’s hard to guess between 10 and 15 percent down. That means our expected revenue is short of what we planned for. So we’ve got some work to do on where we’re going to fund all our planned work,” said Lampi.
Lampi also raised concerns over the department’s ability to replace lines quickly enough. He repeatedly told the council he wanted to “pump the breaks” on paving projects so line replacements could take place before roads were put in. He also raised concerns over residents pulling wastewater teams from site to site across the city.
“We need to have a set policy for when a homeowner calls, ‘I need my water service replaced, you have to pay for it,’ I’d like to set a policy that says, ‘well, you’re not in our area of work, you pay for your side, we’ll swing through and pay for our side while you’re doing that work,’ — but lots of resentment. People want their stuff done, and they want it for free,” he said.
Multiple council members said they saw road projects as a priority that should not be deferred.
“I’m not going to surprise anyone by saying we need to fix the roads. I say it every year, and we spent a million last year, and I hope we can do at least that much this coming year,” said Mayor Marc Tall.
One way Lampi mentioned the city could raise revenue is through the addition of new meters, which would measure both water and electric usage. The primary benefit of the new smart meters would be for the electric department — which according to Electric Superintendent Mike Furmanski has also seen a drop in customer usage — but would allow the city to charge a usage fee.
“I’m big on Mike’s thoughts about fixed charges on meters, and making sure we cover fixed charges and then doing the usage rates so we make a lower rate per gallon but cover our needed cost on a higher meter. It’s hard to swallow, but I think it has benefits. That makes high meter fees. Whether you use water or not, you’re going to have a pretty big bill,” said Lampi.
Wastewater rates could also see changes in the future. According to Lampi, EGLE recently informed him the department should have started work on its intake system prior to beginning the process of improving the wastewater plant.
“Well, the state is saying, they’re coming back, ask us to sign a consent order. They want us to push both projects at the same time — continue on with the plant project, we heard them say they like the plant project, they want us to do it, but now they’re also saying they want collection system work done,” said Lampi.
Lampi did not go into the specifics of how the added work could affect rates, but told the council “It hurts. It’s gonna hurt the rates.”
The city could also be facing additional costs related to a mysterious smell that has popped up in various locations across the city. While the exact cause of the smell is unknown, the working theory is it is the result of leachate (liquid that has passed through solid waste) traveling through the sewer from the Delta County Landfill.
How exactly the smell is escaping the sewer — or even if the landfill is responsible for the smell — is still unknown, but Lampi has begun the process of seeking an engineer to solve the problem.
“I feel that we should hire an engineer to represent us and us alone to do the investigation, I’m not sure where we are, but that’s my intent right now is that the city hires somebody to do investigative work to find the cause of the problem and mitigation,” he said.
Despite costs associated with the lingering smell, Lampi said the real “public enemy number one” for the wastewater department is actually sump pumps that are illegally connected to the sewer system across the city. He said the pumps have increased flow to the water plant and directly contributed to early discharges of partially treated water into the lake.
“I really think if we removed sump pumps, we’d get rid of 2 million gallons a day of our problems,” he said.
How the city would begin to enforce a ban on sump pump usage in the city is still unknown, but Lampi suggested it be charged as a misdemeanor. He also did not know how residents would address removing sump pump water from their homes if they were to disconnect the pumps from the sewer system.