LUMBERTON — The city manager says a drop in utility rates in his proposed budget will save residents more money than a slight increase in water and sewer rates will cost them, which will mean a monthly bill that is a little less painful.
The City Council on Wednesday during a workshop took at look at City Manager Wayne Horne’s $78.3 million plan, which holds the property tax rate steady at 65 cents per $100 of property value and gives city employees a 2 percent cost-of-living increase. The plan, after it is approved, takes effect July 1.
The proposed budget contains a 4.6 percent increase in water and sewer rates and a reduction in electric utility rates by 3.5 percent starting Jan. 1. The rate increase in water and sewer will bring in about $400,000 a year, which is needed to recoup losses from Hurricane Matthew.
It will cover the cost of chemicals, sludge disposal and replacing contents lost to floodwaters, Horne said.
The city currently has a low water and sewer fund balance because of the cost to repair the water plant, which was swamped by Matthew. Much of those expenses will be recouped from the Federal Emergency Management Agency, but that will not include the contents of buildings damaged by floodwaters.
As part of the budget, the city will ask FEMA for a $1.2 million hazard mitigation grant to build a barrier around the city’s water plant to protect it from the flooding that occurred during Matthew.
Horne told council members that electrical rates are coming down because of a reduction in wholesale power costs and demand charges resulting from the reduction in the cost of natural gas. The reduction means a customer who typically pays $100 a month for electricity will now pay $96.50.
The lone holdout on passing the changes in utility rates was Councilman John Cantey.
“Being a part of the flood, being a refugee and looking at the city … I can’t support any increase in fees this year,” Cantey said. “If you don’t even have a home at the moment, how are we going to spend money on Veterans Park, and I am a veteran, and ask increase fees.”
The plans budgets $75,000 for Veterans Memorial Park, but the money comes from grant and state funds. The park was scheduled to be built last year, but Matthew delayed construction.
The budget is expected to be formally approved in June 12, which the council holds its regular monthly meeting. A public hearing on the plan will be held that night.
Several capital projects approved in the fiscal year 2016-2017 budget were delayed because of the hurricane and have been moved to this year’s budget. The projects list includes:
— Shifting water meter reading to an automated system at a cost of $6.7 million over the next two or three years. The implementation of the conversion will depend on approval from the Local Government Commission. The 2017-2018 fiscal year budget has $3.35 million taken from the water and sewer fund allotted for this project.
— The Lambeth Street sewer project, which includes sanitary sewer line improvements and rehabilitation of manholes on the street it is named for, and at the Ramada Inn lift station and sewer main near Kahn Drive, the area around the Cracker Barrel restaurant, and an 18-inch sewer line under Interstate 95. The project is funded using a N.C. Department of Water Resources loan of $1 million with 50 percent principle forgiveness.
— LED street lighting. The electrical utilities department has replaced high-pressure sodium lights on Interstate 95 and adjoining service roads with LED lights. As a result, the power cost is projected to be reduced by 45 percent, while service calls are down 90 percent since installation of the LED lights. Lumberton is responsible for maintaining about 200 lights on I-95. This project, if approved, will expand to Lumberton’s major thoroughfares, such as Fayetteville Road, Roberts Avenue, Martin Luther King Jr. Drive and Fifth Street.
Reach Mike Gellatly at 910-816-1989 or via Twitter @MikeGellatly