In an attempt to make the Knox Water Department more self-sufficient, the Knox City Council is considering a rate increase of $6.70 a month. The increase would be spread out over two years, and, if approved, could mean a monthly increase of $3.75 per month as early as August.
Clerk-Treasurer Jeff Houston explained the hike, which was recommended by Umbaugh and Associates, would ensure the water department could continue regular operations.
“The reason I wanted this rate study done was to make sure we had enough money to pay for our bonds, and other financial obligations. Basically, I wanted to make sure the water department was on sound financial footing,” said Houston.
Houston also said that the water department doesn’t have a lot of spare funds for unforeseen expenses, and the increase would alleviate a level of stress.
“Because we’re running on such a small amount of cushion in the water department, when things come up – for instance, hydrant repair or replacement – it’s hard to come up with the funding. When you’re talking about $10,000 or so, it’s hard to come up with the money for those kind of things,” Houston said.
With the 2 year phase-in increase, $58,836 could be moved from the General Fund to water department fees. The increase would include a new $2 monthly fee for storm water equipment maintenance.
Houston said the customers in Knox are paying less for utilities (water, sewer, and trash) than almost all of the neighboring cities and towns. For instance, currently Knox customers pay $55.40 minimum, while Medaryville customers pay over $70 per month.
Councilwoman Linda Berndt said, “It’s apparent we’ve been getting a bargain and we didn’t know it.”
The rate increase will need to be voted on at three separate meetings, with a possible first time vote on June 26.