Monday, February 25, 2008

Lincoln: Usage drop blamed for water rate increases

COMMENT: The belong makes no sense. Customers get penalized for doing the right thing, aka conserving water?

Bangor Daily News
Monday, February 25, 2008 -

LINCOLN - Increased conservation and smarter business operation among the Lincoln Water District’s 1,200 customers might be why water rates are slated to increase by 27 percent starting April 1, the district’s superintendent said Sunday.

"I’ve never seen it like this before," Superintendent Ronald Gray said Sunday. "This is the third straight year we have seen a steady drop in usage. People aren’t using as much water as they have in the past. It [the decline] goes right across the board, so we have to increase our rates to compensate."

As planned, the rate hike will increase department revenues by about $140,000. This will offset operating losses of $7,000 for 2006 and a projected loss of $65,000 according to district records.

The overall net loss was $53,000 in 2006, and a net loss of $126,000 is projected for 2007.

Minimum charges for water rate usage will increase $10, from $36 to $46, per 1,200 cubic feet of usage, which is the department’s minimum rate, Gray said.

Another 41 percent increase is planned for customers whose usage exceeds 7,800 cubic feet of water, and a further increase of 25 percent is planned for customers whose water usage exceeds 9,000 cubic feet.

Among the big hits the department’s budget has taken are Lincoln Paper and Tissue LLC’s cutting its water usage last year by about $10,000, which Gray called a smart move by LP&T’s management.

"But it’s a loss to us and it’s something that we have to make up," Gray said.

The Water Department is also battling increased fuel, electric and water testing bills while it retires old debt, Gray said. The department also upgraded a pumping station last year.

Howland’s water rate has also grown, by 44 percent, as has Millinocket’s wastewater rate. Millinocket’s original wastewater rate increase of 25 percent was reduced by 11 percent when officials learned a proposed sewer reconstruction project for the town’s north end will cost less than expected.

Water rate increases are also expected to increase in Newport, Hartland and Hampden in 2008, while state voters approved providing $3.4 million in low-interest loans to towns planning to improve or upgrade their drinking water systems as part of a total $18.3 million aid package.

Likely recipients include Newport, Milo, Madawaska, Calais and Presque Isle, and the Passamaquoddy Water District in Eastport, among others.

Gray said he hopes the planned Wal-Mart expansion and planned $4.8 million Health Access Network office building, both on West Broadway, will help defray water costs. Both projects are slated for completion by 2010.

Per the department’s plan, the increase will go into full effect July 1 if the Maine Public Utilities Commission approves the rate increase, Gray said. A public hearing on the rate increase held earlier this month in Lincoln drew two people. The department serves 1,200 accounts, or about 3,000 customers, mostly in Lincoln’s downtown areas.


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