Crossville City Council considering water rate increases due to growing concerns about a tight water and sewer fund budget.
Crossville Finance Director Nathan Clouse said lower federal interest rates have limited revenue growth and caused an increase in depreciation. Clouse said currently, the city’s water and sewer budget shows a $12,000 surplus.
“We are really close on what this water/sewer surplus is,” Clouse said. “We did raise the rates last year by seven percent to try and hedge off some of this, but we are really close on how that’s gonna be. I just kind of give you a heads up there. Anything that changes could impact us into a deficit next year for the water/sewer fund.”
Clouse said that the first year the water and sewer fund goes into a deficit, the comptroller’s office gives a warning, and then in the second year, the comptroller’s office takes over the utilities. Clouse said he believes a 10 percent water rate increase will be needed with the amount of depreciation is coming in years to come.
“10 percent sounds, and it is a lot to some, but let’s say you are a minimal usage rate payer inside the city limits, so I do the $2,000 for water and $2,000 for sewer, my bill would change $2.78,” Clouse said.
Clouse said the state does not allow the city to use general funds to cover deficits. Clouse and Mayor RJ Crawford said he is not looking forward to raising water rates.
“I just hate to say we have to raise rates, not because we don’t have money, but because we are being dictated to do so on depreciation,” Crawford said.
Clouse said he would prefer the city to have a water rate increase approved by the final reading of the budget, so that way the rate could be implemented at the start of the fiscal year and not in the middle of it.
