Board debates rate survey

City board members voted 4 to 3 to three during Tuesday’s meeting to approve a contract with 1898 & Company for a rate study of the city’s utilities.

Originally, the rate study was on the city’s consent agenda but was pulled for discussion by Director Marla Sappington because of concerns over the possibility of rate increases and paying $120,500 to do the rate study, she said.

“Where I work (at The Manna Center), I see people that are experiencing the inability to pay bills,” Sappington said. “I have seen some of them with $1,000 where their bills have gone for three months and then we decide all of a sudden, pay it all or you’re done.”

City directors Mindy Hunt and Lesa Rissler shared Sappington’s concerns over the rate study.

Hunt questioned why the rate study could not be done by city staff. Rissler said the staff report issued by Director of Public Works Steve Gorszczyk on Oct. 26 states the rate study needs to be done to determine an increase.

The staff report states the study will involve the development of a financial plan for each utility that will assess the impact of funding future operating and capital

needs over a five-year period and determine if an increase should be considered over the next five years.

Rissler made a motion to withdraw the study, which was seconded by Sappington. The motion failed in a vote of four to three. Director Brad Burns then made a motion to approve the rate study which was seconded by Director Carol Smiley. That motion passed in a vote of four to three with Hunt, Rissler and Sappington voting against it.

The utility division originally budgeted $92,000 for the rate study, according to Gorszczyk. Additonal funds to supplement the remainder of the amount for the rate study coming from savings on a separate wastewater project that was budgeted at $70,000, Gorszczyk said.

The final cost for the separate project was $30,932 and left a remainder of $39,067, Gorszczyk said. The director of public works said he would use $28,500 of that remainder to cover the rest of the cost of the rate survey.

Four citizens spoke out against the rate study citing concerns about the study.

James McGuirk asked why the utility department doesn’t just save the money for other wastewater projects. His wife, Jan McGuirk, said people are having a hard time paying their bills and spending $120,500 to determine how much rates will go up is a bad move.

David Allen, who was recently elected to Position Seven on the city board of directors, said Siloam Springs had the highest rate per kilowatt hour compared to the other four cities of Bentonville, Fayetteville, Rogers and Springdale.

He said Fayetteville, Rogers and Springdale have a rate of 8.26 cents per kilowatt hour and the city of Bentonville has a rate of 9.19 cents per kilowatt hour. Siloam Springs’ rate per kilowatt hour is 9.43 cents.

The cities of Fayetteville, Rogers and Springdale do not have their own electric utilities, according to employees at each city. Fayetteville uses AEP/Swepco and Ozark Electric Cooperative according to city engineer Chris Brown; Rogers uses AEP/Swepco and Carroll Electric Cooperative, according to customer service representative Julie Garza; and Springdale uses AEP/Swepco, Carroll Electric Cooperative and Ozark Electric Cooperative, according to permit specialist Heather Pollard. Each company has their own rates per kilowatt hour.

The city of Bentonville provides its own electric service, according to bentonvillear.com. Rates per kilowatt hour vary depending on the season, type of property and if the customer has net metering, the website states.

The city board of directors also discussed and voted on the following items:

Consent Agenda

• Approving the budget workshop minutes from Oct. 20.

• Approving regular meeting minutes from Oct. 20.

• Approving the dedication of utility easements at 1400 U.S. Hwy. 412 E.

• Approving Resolution 51-20 concerning a special event permit for the annual Turkey Trot 5K.

Resolutions

• Approving Resolution 50-20 regarding a preliminary plat development permit for 14505 N. Country Club Road.

Ordinances

• Placing Ordinance 2028 regarding the annexation of 39.22 acres at 14701 N. Country Club Road on its second reading.

• Placing Ordinance 2029 concerning the annexation of 6.10 acres at 22000 Hwy. 16 on its second and third readings then casting a separate vote to adopt the ordinance.

• Placing Ordinance 2030 regarding rezoning 125 A and B East Kenwood Street from R-2 (Residential Medium) to C-2 (Roadway Commercial) on its first reading.

• Placing Ordinance 2031 concerning rezoning Villa View Subdivision from A-1 (Agriculture) to R-1 (Residential Large) on its first reading.

• Placing Ordinance 2032 regarding a change to the Zoning Code to require fence and driveway permits on its first reading.

Staff Reports

• Comprehensive Plan Update.

• September Financials.

• Administrator’s Report.