Athens City Council OKs Rate Study on 3-2 Vote

By Michael V. Hannigan

Monday night, the Athens City Council voted 3-2 to have NewGen Strategies & Solutions conduct a water and wastewater rate study.

Officials said the city tries to conduct a rate study every five years and the new study will be the fifth since 1991. The last rate study was completed six years ago in 2008.

Council members Joe Whatley and Charles Elliott voted against the rate study.

Whatley was the most vocal opponent, saying the council should delay the study one year because of changes brought by the new contract with the Athens Municipal Water Authority (AMWA). The new contract shifts the burden of paying for maintenance and repairs at the water plant to the city.

Whatley said the city should wait to better understand the complete impact of the new contract. He said there were still questions regarding the cost of using the new well. He was also concerned that the city’s legal fees connected with defending the lawsuit brought by AMWA last year might skew the numbers.

“There are many unknowns that one year can answer under this new contract,” he said.

The rest of the council, led by Monte Montgomery, disagreed saying the costs related to running the water plant were known: items such as chemicals, salaries and contracts.

“The operational costs are not going to change,” said Director of Utilities Glen Herriage.

The difference is that the city will have to pay those costs now under the new contract with AMWA.

Montgomery also said that the city had already delayed the rate study one year because of the water controversy.

Assistant City Administrator and Director of Finance David Hopkins reminded council members that the rate study is not just for the water plant, but also looks at water collection, water distribution and the sewer plant.

Hopkins added that the legal battle with AMWA had “severely depleted our reserve.”

According to documents obtained by HCN through an open records request, the City of Athens has paid about $347,000 in connection with the lawsuit filed by AMWA in December 2013. That money came out of the utility reserve fund.

The city’s water and wastewater rates were last raised in 2012, when an average 3 percent increase went into effect. A similar 3 percent increase was implemented in 2011. Miscellaneous fees and charges — such as customer deposit, connection fees and tap fees — have not changed since 2008.