Greenwood City Council approves water, sewer service rate increases
The aldermen also voted 5-1 to approve emergency clauses for both ordinances.
GREENWOOD — Residents who pay for water and sewer services from the city can expect to get a higher bill starting this month.
The City Council voted 6-0 to adopt ordinances enacting higher water and sewer rates that will be phased in over two years after final readings for both at its meeting Monday.
The council had to approve three readings of the ordinances before they could take effect under state law. It passed the first and second readings Nov. 6 and Dec. 5, respectively.
The aldermen also voted 5-1 to approve emergency clauses for both ordinances, which made them effective immediately. Daniel McDaniel, who represents Ward 1, cast the dissenting vote each time.
THE RATES
The ordinances break the new monthly rates down into a one-time fixed charge covering the first 1,000 gallons used and a volume charge for every 1,000 gallons beyond that. They provide different rates for the two existing classes of customer — those inside and those outside Greenwood city limits.
Under the ordinances, someone living in Greenwood who paid $33.25 to use 4,000 gallons of water in a month last year will pay $40.50 for the same amount this year and $48.90 in the first quarter of 2025. A person in the city who paid $18.75 for 4,000 gallons for sewer in a month in 2023 will similarly have to pay $40.80 for it this year and $48.40 in 2025.
The ordinances also provide for annual water and sewer rate adjustments consistent with changes in the national consumer price index for all users beginning Jan. 1, 2026, and continuing every year afterward. However, the
City Council may vote to reduce or forgo the adjustments in any upcoming year before they take effect at the start of each calendar year.
Theresa Burtchett, chairwoman of the Greenwood Water and Wastewater Commission, has said the city last voted to raise the rates in 2012.
TAKING EFFECT
Tim Posey, city water distribution director, said Wednesday residents will see the rate increases in their January water and sewer bills. The bills will be due and payable in February. The ordinances state the new rates are effective Jan. 1.
Posey told the City Council it would be beneficial to enact an emergency clause for the water rate ordinance to avoid the city having to wait 30 days for it to take effect after adoption per state law. Dalton Moore, director of the city Wastewater Department, requested the same for the sewer rate ordinance.
Posey said Wednesday he felt like the city did its diligence in letting residents know about the rate increases. In addition to the City Council reading the ordinances on three separate occasions, the city held public hearings and distributed flyers on the subject. The hearings took place Dec. 5 and Dec. 19.
McDaniel said his vote against the emergency clauses stemmed from his being against their use for the ordinances, rather than the rate increases themselves. He thinks the spirit of an emergency clause is to allow a city to act on issues it didn’t anticipate for the health and welfare of its residents, such as repairing a broken sewer line.
“I don’t think normal business should be handled in an emergency because it looks as if we’re rushing things through the system,” he said.
THE RATIONALE
The city’s public hearings served to inform people about what the rate increases would entail, how they were determined and why city officials said they were necessary. They also provided people opportunities to ask questions and voice concerns.
Tom Marsh, city finance director, said at the Dec. 5 hearing that Greenwood’s revenue for water and sewer services combined have grown modestly since 2011, going from more than $2.75 million to slightly less than $3.25 million in 2022. However, its water and sewer operating expenses grew more rapidly, from between $2 million and $2.25 million in 2011 to more than $3.25 million in 2022.
Marsh explained factors such as supply chain issues and inflation caused the city’s combined water and sewer expenses to increase significantly after 2020. He also claimed expenses grew even more quickly in 2023, though he didn’t provide specific numbers.
The city Water and Wastewater Commission discussed implementing a rate increase and was doing a rate study in 2019, according to Marsh. However, the idea was put on hold in 2020 due to the covid-19 pandemic. Greenwood hired Hawkins-Weir Engineers in Van Buren to do the study to generate the new rate in collaboration with the city.
Meg Kelch, project engineer with Hawkins-Weir, said the city’s water and sewer systems have both had to deal with aging infrastructure and equipment, increased operations and maintenance costs, and inflation, among other things. More specific factors include the James Fork Regional Water District increasing the average rates for water it sells to the city by 82% from 2021 to 2023 and costs for chemicals for wastewater treatment rising more than 300% over two years.
Kelch said Greenwood also had to do a rate study as a result of Arkansas Act 605 of 2021.
The act — with some exceptions — put more responsibilities on retail water providers in managing and operating their water systems, according to the Arkansas Department of Agriculture website. It requires providers to prepare a rate study using a state-approved entity every five years or before any major development project. The provider then must implement the rates determined from the study within a year of the study’s completion or two years if the provider’s rates would increase by at least 50%.
Kelch said Act 605 is meant to ensure water systems are paying all their infrastructure needs and budgeting appropriately. This includes setting aside reserve accounts so they have enough money for needed projects. Part of Hawkins-Weir’s rate study for Greenwood includes contributions for such reserve accounts.
Some of the money from the rate increases will go to water and sewer projects outlined in five-year capital improvement plans, Kelch said. Water and sewer expenses are paid for by water and sewer rates, as well as city sales and use tax money.
Kelch said an annual rate increase for water and sewer service after the two phasedin increases would help the city keep up with inflation. However, the city Water and Wastewater Commission will do an annual review to determine if an increase is necessary.
People outside Greenwood have to pay a 25% surcharge for water and sewer service, which was the case under Greenwood’s previous structure, according to Kelch.