By Callie Hietala
The Henry County Public Service Authority (PSA) is on track to go an entire decade without increasing rates, should it approve the budget presented by PSA General Manager and County Administrator Tim Hall. The proposed spending plan does not include a rate increase for the 2022-23 fiscal year.
“Staff is not recommending any adjustment to PSA rates for the next fiscal year,” Hall said. “However, we do think it’s a good idea to proceed with a rate study.”
Currently, residential users are charged $30 per month, and non-residential users $45 per month, based on 4,000 gallons per month. Institutional users are charged $65 per month based on 6,000 gallons a month.
As Hall noted, the current rates place the county in the middle, if not below, the state average.
Hall recommended a rate study in the coming year so that data would be available should the PSA need to increase rates in the future.
“Things can move quickly,” Hall said, “as we have seen in the last 6- or 8-months. The team that put this together recommends you go ahead and budget for that, and proceed with that just so you can have the data available should you have to do it quickly. It’s better to have that information at your fingertips than to have to go out and find it when you need it.”
The last rate study, according to the budget document, was completed in 2013, “and clearly, we’ve done an extraordinary job in managing our business since then. But costs continue to rise, and adjustments in revenue should be considered,” Hall said.
Gerry Lawicki, chairman of the PSA board, asked if the low rates exclude the agency from certain federal projects.
“They probably would be if we pursue those. We’ve had that before. We have been told in conversation with some folks that that could be a drawback if we want to borrow money,” Hall said. “The people that loan you money want your rates to be sufficient to get an adequate return … In the past we have had rates that did not meet that threshold.”
The overall proposed budget amount– $11,976,319—is a 5.2 percent decrease over last year’s $12,635,578, Hall said. Much of the decrease, he explained, is because there are fewer capital needs in this year’s budget.
The capital improvement projects that are included in the upcoming fiscal year include $22,000 to replace an equipment trailer; $159,000 to replace three trucks; $250,000 for the continuation of system-wide water line rehabilitation; $50,000 to continue the large meter replacement program; $100,000 to address water and sewer line extensions throughout the system; $168,000 to implement an Inflow and Infiltration Flow Study; $127,000 to continue a repair and maintenance program for water storage tanks; and $35,000 to revamp the website.
Budgeted expenses include fuel which, Hall said, is a “wild guess category. We have put what we think is an adequate amount in each department’s cost center.” An additional amount has also been set aside in case the cost of fuel “goes crazy,” he added.
The cost of uniforms also increased, as has the cost of travel for continuing education requirements in several departments. “In the past two years,” much of the continuing education classes were done virtually, but now are beginning to return to in-person. Lab costs also are increasing due to required biennial testing, along with the costs of temporary help in engineering and mapping, “simply because of the number of projects and the lack of personnel to do them,” Hall said.
The budget proposal includes increasing a current part-time secretarial position in Regulatory Compliance to a full-time position to provide additional back-office support and to reinvigorate the back-flow prevention program which, Hall said, has gone dormant.
The budget also includes the PSA sharing in a number of costs, including the cost of a second employee in Human Resources (HR), who will split their time between the HR and Finance Departments. Additionally, staff proposed the PSA begin paying a proportional share of the maintenance costs of the county administration building.
“PSA has been in this building for more than 25 years and has never paid rent,” Hall said. “We bring to you the idea that perhaps that needs to start.”
According to a study conducted by Deputy County Administrator Dale Wagoner of the building’s square footage, the PSA takes up about 18 percent of the office space. “Based on the market rate of that, we figured that would be about $150,000 annually,” Hall said.
The proposed budget includes an average 6 percent pay raise for employees, matching the request in the county budget for county employees. “However, it does not match the cost of living and inflation, which I just saw this morning is at 8.5 percent. It’s gone from 7 to 8.5 in the last couple of weeks,” Hall said.
He added that the county is “seeing people leaving our employment for other jobs that pay more money,” which the pay increase is trying to combat. “We never used to lose people. We may have paid right at market or perhaps a little below market, but our benefits were such that people wanted to be in these jobs. What we’re seeing now is that’s not the case.”
Hall said the county has done a great job of recruiting companies to come to the area. He noted the average manufacturing wage in the community has increased from $16 to $21 per hour. “Our people are going to work for the people we’ve recruited because we haven’t been able to keep up with those numbers,” he said. “We need to try to incrementally get the pay up for our folks.”
The budget narrative stated that the county and school board are working to develop a compensation study, which will include PSA should it come to fruition. “It’s imperative that the county and PSA implement whatever the compensation study recommends,” the narrative stated. “To do otherwise means the money to do that study was wasted, and it tells our employees that we aren’t serious about their compensation.”
The PSA board unanimously voted to hold a budget work session at its next regular meeting on May 16.
Henry County Administrator and PSA General Manager Tim Hall said the proposed PSA budget does not include a rate increase for customers. The overall budget is a 5.2 percent decrease over last year’s, which Hall attributed in part to the decrease in proposed capital projects.