Revised Hannibal Board of Public Works utility rates take effect Tuesday, July 2.
Sewer rates will remain the same. Electric rates for most HBPW customers will hold steady, except for a few industrial customers who will see a decrease. Water rates will be going up 3.5 percent in all customer classes.
"It (water rate increase) is consistent with the cost of service study we did in 2018. It is also consistent with our five-year rate increase plan that we started advertising about this time last year, having a 3.5 percent increase in July and about a 7.5 percent increase each January to fund three things, the GAC (granulated activated carbon) project, the loss of Ralls County water and general inflationary items," said HBPW General Manager Heath Hall, during a recent public hearing regarding the rate increase.
The rate hike to the average residential customer will amount to approximately $1.43 per month.
"We are trying to keep the hit in July relatively low," Hall said.
Overall, water rates will climb 53 percent over five years. The scheduled rate hikes to accomplish that goal began in July 2018.
HBPW Board President Lennie Rosenkrans asked about the possibility of tapering off the increases near the end of the five-year period if the GAC project was costing less than the amount of bonds that were sold.
"Definitely our plan would be for a future rate increase to be lower or nonexistent in one of the January increases," said HBPW Finance Director Abraham Gray. "The plan was to keep the increases reasonable, affordable and steady. I would not want to waive a series (rate increase) and then have to double up a series and shock the customers."
In the electric department the HBPW has redefined its large industrial user rate category. That will lower the monthly peak demand requirement from 4,000 kW to 1,000 kW and remove the load factor requirements for qualifying customers. Hall said the change will increase the number of qualifying customers from one to four.
"There is an opportunity for other people to join that category," Hall said.
Hall estimated the change will cost the electric fund approximately $150,000.
The other electric rate change eliminates power factor correction penalties that affect some industrial customers.