Gentry City Council discusses new water rate study requirements
GENTRY — The city council in Gentry discussed the best way to proceed with the required water rate study which will be required of the city by 2026 as a result of Act 605 of 2021.
According to the Arkansas Department of Agriculture website, Act 605 “tasked retail water providers with additional responsibilities in managing and operating their water systems, with some exceptions. These responsibilities include preparation of a rate study every five years or before any major development project. Rates determined from the study are required to be implemented within one year of the completion of the study, or two years if the recommended rates increase the provider’s rates by fifty percent or more. Failure to complete a rate study or implement the required rate increases will result in a determination that the water provider is in fiscal distress. Rate studies must be filed with the Arkansas Legislative Audit and the Arkansas Department of Agriculture’s Natural Resources Division.”
Since the city is currently preparing for a major wastewater project and, in the past, the city has done combined water and wastewater rate studies, the best way to proceed with obtaining the required rate study is under consideration by the council.
Kevin Johnston, Gentry’s mayor, suggested that, while it would be possible to proceed with a water system study, it would be hard to know the scope of the wastewater study until after the city receives a report being completed by Garver on the city’s current wastewater system
and its future needs. Johnston explained that the city knows it will need a new wastewater treatment plant but the capacity of that plant and the needed updates and repairs to the current system were not known with enough certainty to proceed until the current study of system needs is completed.
“We are gathering information now,” Johnston said, explaining that the city would be in a far better position to do a rate study on the city’s wastewater rates “when we know what we need to do to update the infrastructure and we know how big a wastewater treatment plant we need to build.”
Johnston indicated that the city, if it rightly timed doing its rate study, could possibly do one study rather than two and meet the new state law’s requirement for a first study as well as obtain the needed information for funding its upcoming wastewater project.
Johnston said the question is: “Will we have to do two rate studies in the next five years, or one?”
Councilman Jason Williams suggested trying to do one study.
Johnston said, “If we wait six months, we might be able to do the sewer rate study at the same time” as the water rate study.
The council’s general consensus was to have the city water/wastewater committee begin working on a draft for a published request for statements of qualifications so that the council can select an approved list of professionals (usually three) for the city to contact to negotiate a contract for services.
The city’s last rate studies for water and sewer services were completed in 2006 and 2019 and it was recommended that the city increase water and sewer rates by 3 percent each year to keep up with inflation and rising costs and provide for maintenance and upgrades.
Mayor Johnston reported to the council that the splash pad and the sports complex projects are being wrapped up with the last punch list items being completed. He said these two projects would likely not be on the monthly update anymore. He said the city had taken ownership and the park bonds were being closed out. Among work still to be completed by the city was tree planting in the fall.
Larry Gregory, of Garver, said the city water storage facility on Y-City Road is in the last one percent of the project, with some telemetry work still being completed. He said the old lines had not yet been cut but indicated that time was getting close.
He also mentioned the study of the city’s wastewater system, saying that smoke testing would be starting last week. The tests would help the engineers discover leaks in the sewer system and better determine where repairs and upgrades are needed. The study will also map out the city’s sewer system. Gregory also told the board that Garver does not do rate studies at this time.
Johnston told the council that the next piece of the city’s parks master plan was a Tuj Lub court, which could possibly be built at the current site of the old ball park in Main Street City Park. Tuj Lub (pronounced “too loo”) is a top-spinning game that has its roots in Southeast Asia and holds cultural significance to the Hmong community. When construction of a Tuj Lub court begins will depend on available funding for the city parks.
A bond measure passed in September 2019 allows the city to issue bonds for up to $15 million of the money generated by 1/2 cent of the city’s 7/8 cent sales and use tax increase which was passed by the voters in November 2018. However, it was later determined that the tax revenue would only support bond issuance of approximately $5.1 million. Once those bonds used for the splash pad and sports complex are refunded, the city could issue new bonds backed by the taxes to move forward with additional parts of the parks master plan.