City reviewing water and sewer rates, services
The city is conducting the first utility study since 2001.
The process was just getting started in January and Jim Rearden, public works director, said the team plans to come to the City Commission in April or May with a comprehensive review.
A $137,313 contract was awarded to Advanced Engineering and Environmental Services, Inc., or AE2S, during a December commission meeting. This project is being funded through the Water and Sanitary Sewer funds, which are generated by fees for service and not funded through the general fund.
City officials have said this study on water and sewer costs of service is necessary to evaluate current and future costs and compare them to industry standards for Montana and the region.
The city water and wastewater systems have 22,377 metered utility consumers; treat and pump 4.3 billion gallons of water annually; 320 miles of water mains; 3,200 fire hydrants; treat 3.5 billion gallons of wastewater annually; 263 miles of sanitary sewers; and 4,507 sanitary sewer manholes.
Earlier this month, Shawn Gaddie briefed commissioners on the process involved in the survey. Gaddie runs AE2S Nexus, which is a sister company of AE2S and blends financial and engineering expertise.
City water and sewer increases over the last decade were:
- 2004: 2 percent for water and sewer
- 2005: 2 percent for water; 1 percent for sewer
- 2006: no increases for water or sewer
- 2007: 5 percent for water and sewer
- 2008: 5 percent for water and sewer
- 2009: 5 percent for water and sewer
- 2010: 5 percent for water; 7.5 percent for sewer
- 2011: 5 percent for water; 7.5 percent for sewer
- 2012: 5 percent for water; 10 percent for sewer
- 2013: 5 percent for water; 10 percent for sewer
- 2014: 5 percent for water; no increase for sewer
- 2015: 7 percent for water; 3 percent for sewer
- 2016: 10 percent for water; 3 percent for sewer
Gaddie told commissioners that the city public works department has been doing a good job of reviewing rates annually and the city has remained competitive in the market with small increases over the years. Many of those increases have been driven by regulatory requirements that forced the city to make significant upgrades to the water and wastewater treatment plants.
It’s a “very prudent, proactive strategy,” Gaddie said of city staff’s approach.
Last year, AE2S Nexus released a survey of utility rates of 285 communities throughout the Upper Midwest and Rocky Mountain region. The survey ranked Great Falls among the lowest in Montana and the lower quartile in the region. Of those surveyed, 130 were systems serving populations of 5,000 and greater. Survey data was collected from utilities in Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, Utah, Wisconsin, and Wyoming.
Compared to larger Montana communities, Great Falls has the lowest commercial and residential rates for water and sewer.
The monthly residential rates for water and sewer for Montana cities are:
- Bozeman: $96.16
- Missoula: $85.93
- Butte: $79.08
- Helena: $71.21
- Kalispell: $68.98
- Billings: $68.73
- Great Falls: $63.94
Monthly commercial rates for Montana cities are:
- Bozeman: $103.36
- Butte: $93.83
- Missoula: $92.87
- Kalispell: $90.43
- Helena: $89.92
- Billings: $80.96
- Great Falls: $75.70
Gaddie told commissioners that the city’s top 10 water customers are Malmstrom Air Force Base; Calumet Montana Refining; City of Great Falls; Benefis Health System; Great Falls Public Schools; Black Eagle and Cascade County Water District; Great Falls Housing Authority; University of Providence; Highwood Mobile Home Park; and Malteurop.
The top 10 wastewater customers are: Malteurop; Malmstrom; Calumet; Benefis; Great Falls Housing Authority; GFPS; Black Eagle and Cascade County Water District; Meadow Gold; Cascade County Adult Detention; and Highwood Mobile Home Park.
Some users can pay up to $1 million in utility costs, Gaddie said, and the study will look at the users and what drives their costs.
The city has spent recent years dealing with regulatory issues and an aging system. Gaddie said the study helps ensure no issues with that aging system are overlooked as the city makes plans and budgets for improvements.
The goal is to address funding shortfalls, Gaddie said, without creating rate shock as well as set targets for reserve funds specific to the city’s operating systems.
Greg Doyon, city manager, said the public works department does a good job keeping commissioners informed on the rate adjustments and why they’re needed.
Utilities is one of the ways the city deals with economic development, Doyon said.