By Jim Newell
The Orion Township Board of Trustees voted unanimously, 7-0, to raise water and sewer rates 14 percent, effective July 1, during the board’s meeting on Monday.
The vote came after Director of Public Services Jeff Stout made the request to increase rates.
“We need to get close to what I’ll call water neutral,” Stout said.
“We’ve been selling water at a loss for many, many years. We don’t charge our residents what Detroit water, now Great Lakes Water Authority, charges us,” said Supervisor Chris Barnett, adding that the township’s new rates are “still more than 60 percent less than our surrounding neighboring communities.”
Water and sewer users will also be billed monthly instead of quarterly.
“This has been discussed since I started in 2012. You wouldn’t run a business like that. It’s never a fun discussion or decision, but as Jeff stated, this will help get us to budget neutral and cover the cost that we pay, so I fully support this,” Barnett said.
Trustee John Steimel said the township has been absorbing water rate increases for years, but he still favored a gradual increase approach.
“Well, I’ve been here the longest so I know why we got to this point – because there was constantly, constantly lots of questions about how much money was in the water and sewer fund, that it was way over-funded,” Steimel said. “So, the idea kind of was, let’s absorb some of these water rate increases and kind of buy down that fund balance, because it was kind of high. We always knew at some point that it had to change.
“The only thing I don’t agree with is this sudden shock of, boom, now we have to get it back to zero in one shot. I would be more in favor of a plan that’s going to start increasing the rates rather than just (doing it) overnight,” Steimel said.
Stout said the township had a study completed three to four years ago and has been putting a plan in place since then.
For 2019-20, water rates will increase from $3.10 to $3.54 per 100 cubic feet, a 14 percent increase from 2018-19. A minimum monthly charge for water will be $14.16 per 400 cubic feet, according to township documents.
Metered sewer customers will also be billed $2.93 per 100 cubic feet of water beyond the first 3,200 cubic feet.
For 2019-20, the Oakland County Water Resources Commission set the township’s annual revenue required at $3,855,948.96. Effective July 1, the township’s new rate to cover the cost of sewer purchases will increase from $82.34 to $93.87 per REU (Residential Equivalency Unit), with monthly billing of $31.29 after Aug. 1, 2019, according to a township memo to the board.
“This 14 percent increase will allow us to reduce our fund balance to cover sewer purchases as we have done in the past. All customers will receive a minimum of one sewer unit,” Stout said in a memo to the board.
Increasing operational costs for the water and sewer department necessitated the increase, he said.
“We will have a continued rate increase from here on out for quite some time,” Stout told the board. “I don’t want you to think that it’s (a) one shot (rate increase) because we’ve been chipping away at this for at least three years now.”
“Really, these (rates) get renewed every year. If they (the GLWA) raises the rates, we do too,” Steimel said. “The question is, do we raise it the same amount they did, a little less, or, in this case, maybe a little more? That’s kind of how it goes from year to year.”
Orion Township raised water rates from $2.90 in 2017-18 to $3.10 in 2018-19.
“We’re going to have to absorb the increases as we move along. If they (Detroit) keep on moving them at 10 percent then we’ll always, always, always be in the hole,” said Treasure Donni Steele.
The Village of Lake Orion gets its water through Orion Township. Village Manager Joe Young said the village had planned for a rate increase this year, but not 14 percent. The village council would decide how much of the rate increase to pass along to village residents.
“We’ll be evaluating it and go from there,” Young said.