Highfill approves 3% rate increase for water, sewer

HIGHFILL — Water and sewer rates are going up in the city.

The City Council on June 13 passed two ordinances to raise the city’s water and sewer rates by 3%. The items passed on three readings, and the emergency clauses for each were adopted.

The increases come as a result of a recent rate study completed for the city by Kopke and Associates and the recommendation of the firm to increase rates.

According to the May council meeting minutes, “Jerry Kopke helped put together a study on the water and sewer rates in Highfill. He used the financial records from 2021, 2022 and 2023 to determine the financial stability ratios. He explained there are three measures that cities are required to meet in the state of Arkansas. One is the operating ratio which is revenue minus expense. The target ratio is 1.05. The second is the debt coverage ratio which is the money leftover from operating expenses to fund debt obligations. The state requirement is a ratio of 1.1. The third is the operating reserve which needs to be at least 1/12 of the annual expenses. Highfill meets the requirements on water, but sewer is more difficult to meet since there are fewer customers.”

Kopke recommended increasing the water and sewer prices by 3% a year for the next five years.

According to the May meeting minutes, “the minimum increase of 3% for water is 81 cents and for sewer is 55 cents. The average user’s monthly bill would go up $1.49 for water and $1.66 for sewer. An average user’s monthly bill with both water and sewer would go up $3.15.”

Jerry Kopke explained that Act 605, which was adopted in 2021, required public water systems to do a rate study every five years, as well as before any major improvement. An amendment to Act 605 gave an extra year to comply with that requirement and eliminated the need to have a rate study done with any improvement, May meeting minutes state.

Instead of adopting a scheduled 3% increase each year for the next five years, the ordinance passed by the council increases the rate this year, with the intention of further review of sewer system costs once the city connects with the Northwest Arkansas Conservation Authority and learns the cost of using the regional water treatment facility.

Mayor Chris Holland, along with the city’s water board, recommended the 3% increase now rather than waiting and needing to make an even larger increase later.

Council member Toby Lester voiced concerns about possibly needing to increase the water and sewer rates twice within a one-year period, saying it makes it look like the council hasn’t done its homework if it asks for an increase and then has to come back for another increase within a year.

Whether another increase will be needed will depend largely on the rates the city will have to pay to NACA, and those figures were not yet available for the city to use in its rate study.

The council passed on its first reading an ordinance adopting current codes used by the state of Arkansas, including the Arkansas Fire Prevention Code, the Arkansas Fuel Gas Code, the Arkansas Electrical Code, the International Mechanical Code and the Arkansas Plumbing Code.

A resolution was passed establishing guidelines and policies for the use of the recently remodeled community building to add the Highfill Cemetery Association to the list of those organizations exempt from paying a user fee and cleaning deposit.

The council also approved the purchase of a Chevrolet Tahoe for the Fire Department to use as a command vehicle. The estimated cost of the purchase is between $77,000 and $78,000, which includes everything but the needed radios. It was reported that the city has one radio but two others would need to be purchased. It was estimated that the total cost to purchase and equip the vehicle would be less than $80,000.

Delivery time for the vehicle was estimated to be 12 to 15 weeks.

The council transferred $2,918 from the water revenue fund to the fire equipment fund and also approved a midyear budget adjustment to account for some part-time employee expenses.

Police Chief Blake Webb told the council of the success of the city’s drone team operated by officers from the police and fire departments. He said the team volunteered its time and was able to assist Bella Vista in finding a lost citizen with the drone technology.

Holland said that ESI would be presenting plans for improvements to Douglas Cemetery Road at the July council meeting. He said that residents could review the plans at the meeting and some food might also be provided.

Lester suggested the city look at better signage to welcome people to the city, saying the current signs look cheap. Holland suggested the city also look at obtaining some digital signs.