Residents in Bloomfield Township will have the same water rates in fiscal year 2020-2021, while sewer rates will increase 14 percent from fiscal year 2019-2020, effective April 1, 2020.
Bloomfield Township trustees approved the recommendation to maintain the current water variable usage rate of $5.86 per 1000 gallons, while agreeing to increase the sewer variable usage rate from $8.37 to $9.56 per 1,000 gallons, presented by Olivia Olsztyn-Budry, director of engineering and environmental services, at their meeting on Monday, April 13.
Olsztyn-Budry explained “the township owns, operates and maintains the water system that delivers the water to the customers and the sewer system that collects the wastewater from each customer. The water and sewer system consists of over 500 miles of buried pipe throughout the township that is operated and maintained by the township. In order to determine the township’s charges for water and sewer to the customer, the water and sewer systems’ estimated expenses are added to the estimated water and sewer purchases from Southeast Oakland County Water Authority (SOCWA) and the Oakland County Water Resource Commissioner’s Office (WRC). These costs are then divided by the estimated volume of water to be sold to the township’s customers.
“Water volumes are dependent largely on customer usage and seasonal precipitation with approximately 65 percent of the annual water usage occurring from May to October. Since 2008, Bloomfield Township has seen a significant drop in water consumption.”
Further, she said, last year was a wet year, so water sales were down. Officials are estimating the 2020 water usage based on a review of actual and historical trends in water purchases since the early 2000's.
“When we have wet years, there is less revenue from water sales and less revenue to sewer sales, but it results in revenue to pay for the WRC Evergreen-Farmington Sewage Disposal System (EFSDS),” she said, as there is more flow into the sewer system.
While SOCWA charges based on volume for water, WRC charges a flat rate for sewage services, dividing up county expenses between participating communities for a monthly charge.
“Last year did not generate enough revenue to pay the for the WRC EFSDS,” said Olsztyn-Budry, with the township suffering about a $298,000 shortfall in the sewer charge rate.
This year's cost is $670,847.73, she said. “The WRC's expenses are the same regardless of the flow.”
To questions from trustees, Olsztyn-Budry said there are about 2,000 more water customers in the township than sewer customers. There are also some residents who have secondary water meters for irrigation.
She also explained the water and sewer fund has a reserve fund, which is available for funding capital improvements, operations, and emergencies.
“The reserve fund balance at the end of FY19 was approximately $8 million. This is significantly below the recommended reserve fund balance according to the township’s financial expert as part of the water rate lawsuit. The recommended and appropriate cash reserve that the water and sewer reserve fund should be is roughly $15.65 million.”
Trustees approved maintaining the water use rate and increasing the sewer usage rate, 6-1, with trustee Dave Buckley voting against both.