Consultants hired by the Town of Yarmouth are recommending changes to the rate structure used to pay for the town’s sewage treatment plant and sanitary sewer system.
If they are accepted, over the next five years the costs of managing the system will move to a full cost-recovery model and heavy users will pay more.
A higher percentage of the costs will be collected from usage charges, increasing them from 50 percent, where are now, to 70 percent of the formula now used to calculate ratepayers’ bills. The move will give individuals more control over the amount they pay, because the less they use water, the more they will save on their sewer bill.
Consultants also recommend moving the costs of debt repayment and depreciation on assets from property taxes to the sewer rate. Property taxpayers now fund those expenditures.
The changes would mean a significant increase in sewer rates, (for instance consultants calculate that the average residential customer’s bill would increase just over 50 percent, from $242 a year to $372 a year) but consultants pointed out, it should correspond to an equivalent lowering of property taxes, all things being equal.
It would hit heavy users, especially some industrial and commercial users, very hard. The average commercial or industrial ratepayer with a two-inch water intake pipe could expect to see their rates increase 250 percent over the next five years.
The intent is that those increases would generally be offset by reductions in property taxes.
The results of the sewer rate study were presented to Yarmouth Town Council at a committee of the whole meeting last Thursday, Nov. 22.
In the presentation, the consultants, Gerry Isenor and Bill Gates repeatedly reiterated that the recommendations are not about increasing what is being paid to run the sewer system, it is about redistributing the burden of payment so that the costs are transparent and that those that use the system are those who pay for it.
“You are currently charging people for that service. You are collecting that money out of general revenues. If you take it out of there and say, ‘I’m collecting it from you because you are generating wastewater’, then therefore the tax burden should go down’,” Isenor of G. Isenor Consulting Ltd, told the council in his presentation.
Council has deferred consideration of the recommendations until they have had an opportunity to study the report and have had their questions answered.