Council passes raises of electric, sewage and water utility rates

Published 9:22 am Wednesday, April 13, 2016

Users of the city’s core utilities will be paying a bit more for service over the coming months.

In spite of the reluctance expressed by several members to do so, the members of the Dowagiac City Council unanimously decided to raise the rates of the city’s electric, water and sewage customers during their meeting at city hall Monday. The increases will be split into two even portions, with the first bump appearing on customer bills in June and the second in October.

The rate increases will be broken down as follows:

• The city is increasing the ready-to-serve charge by 8 percent and the commodity charge by 10 percent on electric rates, with the latter increase split evenly across the two seasons. According to data provided by the city, a household that uses 1,000 kWh of power every month, which currently pays $111.06, would begin paying $114.47 per month beginning on bills due on and after June 10, and $116.96 beginning on bills due on and after Oct. 10.

• Homes using 4,000 gallons of water would see an increase of $4.94 to its water and sewage rates on bills due on and after June 10, with an added $3.88 bump on bills due and after October 10.

The increases, the first in two years for electric and sewage rates and the first in four years for water, are designed to keep pace with the increasing price of wholesale power, which has been rising in recent years due to increased regulations on renewable energy sources and cleaner burning fuels for power companies, as well as to maintain current operational levels for city’s power and water infrastructure and to allow for continued capital investment on these structures — including the ongoing improvements underway to the city’s wastewater treatment system.

Prior to the council’s decision, Dowagiac business owner David Fair told the members, during public comment, that he was concerned about the increase, as city businesses are charged higher utility rates than residences, he said.

“Given the current economic climate and the fact that the city is interested in keeping current business and attracting new business, it would be nice if the city council would at least discuss forgoing any increase in business utilities,” Fair said.

City Manager Kevin Anderson responded to Fair’s comment, saying that the increased utility rates to businesses is due to the larger delivery systems, such as piping, that provide service to these locations. The increased rates in question will be accessed equally across both residences and businesses, though, Anderson said.

“If we were to forgo an increase in just the business class, we would have to look at making that up somewhere else because we need to raise a certain amount of revenue to offset those costs,” Anderson said.

Ward One Councilmember Lori Hunt also responded to Fair, saying that while she usually doesn’t like rate increases, the action taken by council Monday was necessary for them continue to provide quality services, especially to the water system.

“I don’t want Dowagiac to be the next Flint,” Hunt said. “In order to maintain quality infrastructures, it has to be paid for.”

Later in the meeting, Ward Three Councilmember Charles Burling echoed Hunt’s point before voting to approve the increases.

“I hate passing on rate increases onto the citizens,” Burling said. “But on the same token, we have to provide a system that provides safe water to our families and fair rates on our electric and sewage.”