Friday, October 31, 2014

Lack of growth clogs Centropolis sewer operations

By ABBY ECKEL, Herald Staff Writer | 7/26/2013

The Centropolis Sewer District has been having some irregularities.

The district has been operating on one sewer pump — instead of two — for a little more than a month, Larry Walrod, Franklin County planning and building director, said. Part of the problem has been the lack of available funds for maintenance and repairs, he said.

The Centropolis Sewer District has been having some irregularities.

The district has been operating on one sewer pump — instead of two — for a little more than a month, Larry Walrod, Franklin County planning and building director, said. Part of the problem has been the lack of available funds for maintenance and repairs, he said.

“Most of you were aware that this was seriously underfunded.  We discussed that back in 2008,” Walrod recently told the Franklin County Board of Commissioners. “[Commissioner Don] Stottlemire hit it on the head when he said that there should’ve been an incremental increase annually to keep pace with the expected [needs].”

The lack of funding comes from growth expectations that did not materialize for the district, which was formed in the 1990s, Walrod said.

“We really didn’t have anything in [the budget] for maintenance and replacement parts simply because the district, when it was formed in the ‘90s, had assumed a certain growth rate and it never really occurred,” he said. “So by not having additional hookups and up-front hookup fees and monthly payments, it just had a shortfall, and we didn’t really — and haven’t really — gone back and revisited that.”

The budget for the sewer district comes from user fees that are collected the same as taxes based on assessments, Lisa Johnson, Franklin County administrator and counselor, said.

“Our budget is assessments, and that’s it,” Johnson said. “[Currently] there are 57 hookups [in the district].”

The county should be bringing in more than what was budgeted for the district, Johnson said. But because of a high percentage of delinquencies, that’s not happening.

“By county resolution the assessment [fee] is set at $564 a year. [With 57 hookups] it should bring in a little over $32,000, if people are paying [property] taxes,” Johnson said. “But 9 percent, or five taxing units aren’t paying anything. So we may budget for $32,000 a year, but we’re only getting in around $30,000.”

Because of the lack of development in the district, new houses and businesses aren’t being built, therefore no new hookup and service fees are being generated, Johnson said.

“Money went in, building permits went up, it was expected the district would grow,” she said. “When you join a district you pay a hookup fee, but none of that has materialized, so revenue is not supporting long-term needs of the system.”

Several factors have played into the district not growing and revenue not being generated, Johnson told commissioners; one of those reasons is a lack of meters.

“Projections were based obviously on availability of water, and that is provided by Rural District 5 out in Douglas County, which actually ended up not having meters available for several years,” she said. “There was inability to develop that area for hookup to the district because you couldn’t get a meter. About the time meters became available was about 2007 or 2008, when the economy took a severe downturn and building came to pretty much a complete halt.”

The lack of building also has meant no new hookup fees, and because of a lack of hookup fees, there’s been a shortage of funds to be able to maintain the sewer pumps, Johnson said. The bottom line: Two sewer pumps need to be replaced.

The commission voted Wednesday to accept a bid from JCI Industries to replace the two sewer pumps, as well as requesting to have the fee assessment put on the agenda for review at the next study session July 29. The money for the two new pumps is to come out of the Centropolis Sewer District fund, Johnson said.

Replacement of the two pumps might have been avoided, Walrod said, but it’s difficult to plan for the district when the budget has to be done before revenues are collected and reported.

“[Commissioners] have a couple options to make certain that [the district has] funding in [the budget] for these kinds of situations like normal maintenance costs,” Walrod said. “If they hadn’t had projected that growth, they would’ve structured the fee structure a little differently, then there would’ve been some funds available for this kind of situation.”The Centropolis Sewer District has been having some irregularities.

   

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