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Manchester to hike water rates

The Manchester Water District is poised to launch a complete overhaul of its water rate structure, a matter to be decided at the July 9 water district meeting.

Previously, Manchester Water had two problems — a complicated multi-tiered rate system and a negative cash flow. Alan Fletcher, the district’s new general manager, said he and an ad-hoc committee of five rate-payers have been working since May to come up with a new rate structure that addresses both issues.

“We used to have eight different rate tiers,” Fletcher said. “Hopefully we’ve made it easier for people to compute their own usage.”

The new proposed system, which will have to be approved by the district Board of Commissioners, has cut the number of tiers in half and will generate an estimated $200,000 in extra revenue every year.

The district, which is supported totally by water rates, has been running a deficit for the last three or so years. In that time, water officials have had to pull somewhere in the neighborhood of $100,000 from the capitol project fund to stay operating.

The new structure has four tiers, one of which is a new “Lifeline” tier. The Lifeline, which is a concept introduced by Fletcher, assumes the average household needs up to 400 cubic feet — approximately 3,000 gallons — of water each month for core operations such as cooking and washing.

“Every household has a basic amount of water it’s going to use,” Fletcher said. “Any water over that, people have the ability to control.”

Lifeline water — anything up to 800 cubic feet per two-month billing period, is billed at the lowest rate: $1.20 per 100 cubic feet (the standard unit).

Although the previous system’s tiers were defined differently, this translates to about a 45-cent increase per water unit.

The second tier bills anything between 801 cubic feet and 3,000 cubic feet at $1.60 per water unit — approximately a 35-cent to 60-cent increase over the old rates.

The third tier constitutes the biggest jump in water rates: anything between 3,001 and 6,000 cubic feet will cost $2.40 per water unit — a 40-cent to 90-cent increase.

Fletcher said the committee wanted to draw a line between normal residential and commercial use while at the same time encouraging people to use less water.

“The committee wanted that steeper incline to promote conservation,” he said.

Everything over 6,001 cubic feet will be billed at $3 per water unit — a 50-cent to 75-cent increase over existing rates.

The base service charge, which is levied in addition to water-based fees, will increase from $17 to $22.50 per billing cycle as well.

Fletcher said he supports the committee’s new proposed rates, which are below those suggested in a rate analysis done earlier this year. He does, however, expect a lot of feedback from the Manchester community, which previously never had to pay more than $2.50 per water unit regardless of usage.

“No one complains about paying $50 or $60 a month for digital cable, but everybody complains if their water bill gets above $20,” Fletcher said.

He estimates the average household would see an approximate increase of $6.50 per bill under the new system, which would likely not go into effect until September.

Fletcher said the district first wants to see what effect the new rates have on its financial situation before potentially making any further changes. Because these rates would not go into effect until the end of the fiscal year, Fletcher does not expect to see much, if any, benefit for at least a year or two. If the district did decide it needed to raise rates again, Fletcher said the changes would take place on a predictable schedule — the district would not again wait several years and then spring a major increase on its customers.

However, he was adamant the district could not continue to raid the capital project coffers to pay for operating costs — the rates needed to pay for the services free and clear.

“Businesses don’t stay around long with that type of hemorrhaging,” Fletcher said.

The Manchester Water District Board of Commissioners will meet at 6 p.m. July 9 at the district’s office, located at 2081 Spring Street in Manchester.

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