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By Beth Hutchinson
Seeley Lake, Mont. 

Paying for Sewer O&M: Two Fairer Ways

 

November 9, 2017



SEELEY LAKE - Greg Robinson and the go-along sewer board have revealed intentions to charge very unfairly for sewer Operation and Maintenance. First, they cannot seem to learn or accept that when it comes to using and deriving benefits from a sewer, residences and businesses are fundamentally not the same. Second, within each class, using and deriving benefits will not be the same.

Regarding the distorted proposal that residences and businesses should pay the same—NO! Businesses have an extra benefit in that they can deduct utility charges as costs of doing business from their income taxes—residences can’t.

Regarding the distorted perception that residences and businesses are the same within their respective classes—again, NO! Wide differences exist among the ways families use water and consequently would use the sewer. Likewise, potentially even larger differences exist among the ways various businesses use water and would thus use the sewer.

Here are two reasonable and common sense methods to charge for O&M that do not threaten to wipe our sewer district out financially.

First Option: use the most obvious way to organize charges—WORK WITH THE SEELEY LAKE WATER DISTRICT. Pay the water district a small amount to compensate for using their monthly records. Structure sewer district O&M charges according to water use. Robertson does not need to obsess over the fact that 8.4 percent of the district is not served by the public water system. It is simple to deal with that by taking less than an hour to construct an appropriate charge for properties lacking public water.

Use water-use records from properties on the east side of the lake as a starting point to create a decent set charge for those who do not have public water. Also, develop a set of small, fixed monthly charges for vacant lots and seasonal properties when the latter are not in use. This fixed charge would help cover on-going personnel costs and would be dropped at the time lots (with access to sewer services) were developed or seasonal properties moved to full time.

I bet a volunteer committee—maybe representing all phases and categories of constituents for a change— could relieve both Robinson and the board of the pressure to find an equitable solution. OR

Second Option: use a system based on ratios to construct O&M rates. Such an approach approximates using water usage as a basis for charges. It is a bit cumbersome to explain, but not at all hard to do.

Again, a fairly representative committee could develop the formula. It would go something like this: Vacant lots and Seasonal* properties when not in use=¼ X, Residence with 1-3 occupants=X, Residence with 4-6 occupants=2X, Residence with over 6 occupants=3X, Business with 1-3 employees=X, Business with 4-5 employees and modest # patrons=2X, Business with 6-8 employees and moderate # patrons=3X, Business with 9+ employees and large # of patrons=4X and Business with 15+ employees and/or very large # of patrons=5X.

(*Seasonal properties would pay a combination of 1/4X and X depending on their use of their homes.)

Take a few minutes to write the list out in a column; it’s easier to read. Notice how it is organized to logically spread the costs without leading to undue burdens. To make it work, you need to know the overall cost of O&M and the number of lots in each category. Then, you multiply the number of lots in each category by its correct X-value and add all the X-values together. Then, you divide the total X-value into the total O&M costs to obtain X and multiply a lot’s X-value by X.

TAKE A BREATH! Don’ be terrified. It is really so much easier to do than write about. Once properties are inventoried and assigned X-values, it takes less than 15 minutes to calculate all charges. The X-value of properties could be reviewed once a year quite quickly. Charges to all groups would be fairer.

 

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