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NEW ULM - The first in a series of four increases to water and wastewater billing will go into effect Oct. 1 this year, following a rate schedule amendment from the New Ulm Public Utilities Commission, Tuesday.
New Ulm Utility Director Brett Fleck said last year, the Public Utilities Commission (PUC) hired a consultant to complete a cost analysis and rate study for the water and wastewater departments. In April, the PUC received a recommendation from the consultant to raise additional $2 million in revenue each year to cover necessary capital improvements to water and wastewater infrastructure.
The idea is to “right-size” the city’s utility rates and bring costs in line with with what is needed to maintain utility infrastructure.
In the case of the water department, New Ulm has 13 wells and all 13 are in need of maintenance. Some of the wells need a few thousand dollars of maintenance, while the older wells need closer to a $1 million.
Part of the problem is aged equipment. The newest wells on New Ulm’s system were drilled in the 1980s, but some are even older.
The wells are only one part of the system in need of improvement. The city has miles of pipes, valves, water towers and treatment plants to consider. New Ulm’s wastewater treatment plant is over 50 years old and many components will need to be replaced having reached the end of life.
Fleck said the commission has looked at multiple options for how best to raise water and wastewater utility rates, without alarming customers.
It was decided to do a four-phase increase. The first increase will go into effect on October 1, but residents will not see the increase until they receive their November bill.
Fleck said the average residential customer will likely see a $10 increase to the water and wastewater bill. The increase will only impact water and wastewater. There is no plan to increase electric or gas rates at this time.
The next rate increase would be July 1, 2027 and would be a monthly increase of $12. In 2028, the increase would be $14 and in 2019 an increase of $17. This is a $53 monthly increase over 3.5 years.
PUC commissioner Darrin Buegler made the motion to approve the rate schedule with a second from Commissioner Kim Williams and passed unanimously.
For more information on the utility increase, Fleck directed residents to the New Ulm Public Utilities website https://www.newulmmn.gov/101/Public-Utilities which features a link to all information on the increase as well as past presentations.