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Hannibal Courier - Post - Hannibal, MO
  • BPW Board approves sewer rate hikes through 2016

  • If you’re already thinking about your budget through 2016, pencil in sewer rate hikes. Increases over the next three years were approved by the Hannibal Board of Public Works Board during its meeting Wednesday.
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  • If you’re already thinking about your budget through 2016, pencil in sewer rate hikes. Increases over the next three years were approved by the Hannibal Board of Public Works Board during its meeting Wednesday.
    The next increase will not kick in until July 1, 2014, when the monthly customer charge will go up from $7.25 to $7.75. On July 1, 2015, the sewer rate will rise to $8.25. On July 1, 2016, the rate will climb to $8.75.
    For BPW sewer customers outside the city limits their rates will climb to $15.50 (July 1, 2014), $16.50 (July 1, 2015) and $17.50 (July 1, 2016).
    Those rate increases could be even higher if an unexpected expense in the Sewer Department were to occur.
    “That’s the starting point. It will be the ending point if we’re lucky,” said Bob Stevenson, general manager of the BPW, who stressed that the next sewer rate increase won’t be seen on customers’ bills until after July 1, 2014.
    The increases stem from the BPW’s attempts to sell bonds to raise money for needed sewer system improvements.
    “As we prepare our ‘official statement’ for the bond sale we must include in that statement some projected revenues and expenses for several years in the future,” wrote Stevenson in a memo to the BPW Board. “Those projections must show a certain debt coverage ratio to ensure bond buyers we will have the money to repay what we borrow. Those projections must also show we are generating enough revenue to make our lease payments and fund our non-bonded capital improvements and still accumulate cash each year. Simply stating that we intend to adjust rates as required in future years is not good enough. We must commit now to rate increases in future years so that our revenue is less speculation. We need to firm up our revenue projections for at least the next three years to meet this requirement.”
    If the Board had not approved the future rate increases the BPW bonds would have had to be sold as unrated bonds with an interest rate of about 1 percent higher than if they are rated.
    Sewer rates in Hannibal went up by 4 percent on July 1 of this year.

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