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Highfill hears recommendations for small water and sewer rate increase

by Randy Moll | May 16, 2023 at 8:00 a.m.

HIGHFILL -- At its May 9 meeting, the city council in Highfill heard a recommendation to increase water and sewer rates by 3% per year and passed ordinances approving the final plat of the Snyder Station Phase Seven and Eight Subdivision and of the Woodward Park, Phase One Subdivision. It also approved a petition to vacate the northwest 80 feet of right-of-way on Linwood Street.

Jerry Kopke, of Kopke and Associates, reported to the council on a rate study his company completed for the city and told the council that his firm recommended a 3% increase in water and sewer rates each year in order to cover expenses and upkeep of the system as well as loan payments.

The rate increase would raise the minimum cost for users to $1.36 per month, with the average water and sewer customer (using 4,000 gallons of water per month) seeing an increase of about $3.15 per month.

Municipalities are required by Arkansas law to perform rate studies to ensure that water systems are self-sustaining.

According to the Arkansas Department of Agriculture website, Act 605 "tasked retail water providers with additional responsibilities in managing and operating their water systems, with some exceptions. These responsibilities include preparation of a rate study every five years or before any major development project. Rates determined from the study are required to be implemented within one year of the completion of the study, or two years if the recommended rates increase the provider's rates by fifty percent or more. Failure to complete a rate study or implement the required rate increases will result in a determination that the water provider is in fiscal distress. Rate studies must be filed with the Arkansas Legislative Audit and the Arkansas Department of Agriculture's Natural Resources Division."

The Arkansas law also requires municipalities operating a water system to "maintain a debt service coverage ratio of 1.05 or higher."

The recommendation was referred to the city's water board for consideration and will be returned to the council for official action.

Kopke commended the city for applying for and being awarded a $2.8 million grant for its sewer system, saying the grant means a $19 per month savings for each sewer customer during the life of the loan which the city took out to match grant funds and complete the sewer project.

According to information presented to the council in February, the city was approved to receive $2.7 million in American Rescue Plan Act funding for the $5.4 million project to run a sewer line to NACA for water treatment services.

After a motion to suspend the rules, read by heading only and pass on three readings with a single vote, all the ordinances before the council at its May 9 meeting failed, the council passed on its first reading the final plat of Snyder Station Phase Seven and Eight Subdivision.

After an appeal from developers regarding the hardship delaying the final plats of this subdivision, as well as the Woodward Park Phase One Subdivision, would cause, the council suspended the rules separately for each ordinance and passed on all remaining readings with a single vote and attached emergency clauses the final plats of the Snyder Station Phase Seven and Eight Subdivision and the Woodward Park, Phase One Subdivision.

A petition to vacate the northwest 80 feet of right-of-way on Linwood Street was also approved by the council, as well as a resolution authorizing the transfer of funds from the Highfill Water Revenue Fund to the Fire Equipment Fund in the amount of $5,750.

Mayor Chris Holland reported to the council that the city plans to hold movie nights in the park in June, July and August.

He said the first farmers market would be held on June 3, from 8 a.m. until noon. He said there would be no charge for vendors at the market.

Holland asked the council if it would be willing to foot the cost for a special election if a petition were circulated to allow Sunday alcohol sales in Highfill. He said Sunday alcohol sales would boost the city's incoming tax revenue. He also explained that the cost of a special election could be as high as $8,000 but lower if other special elections were scheduled at the same time. No vote was taken, but the council indicated its willingness to allow Sunday alcohol sales to be pursued, and Holland indicated a petition would be circulated, with approximately 90 valid signatures required to put the measure on the ballot for voters to decide.

Print Headline: Highfill hears recommendations for small water and sewer rate increase


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