Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, September 1, 1993 TAG: 9309010206
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: JOEL TURNER STAFF WRITER
DATELINE: LENGTH: Medium
Roanoke Valley residents will learn that soon. Their sewer bills probably will increase.
Now that the valley's localities have agreed on a $41 million plan for expanding the treatment plant, they must find the money to pay for it.
And they won't look very far. Ultimately, valley residents will have to pay the bill.
Most localities are expected to issue bonds to pay their share of the project's cost.
For some people, bonds appear to be an almost painless way to finance the plant expansion and new sewer lines.
Except for one thing.
The bonds have to be repaid over 15 to 20 years, depending on their terms.
Bonds are like loans. They are bought by investors, who lend the money to localities. In turn, the localities repay the money in yearly installments.
The regional treatment plant serves Roanoke, Roanoke County, Salem, Vinton and Botetourt County. Roanoke owns the plant, treating sewage from the other localities on a contract basis.
The city charges based on volume.
Each locality can choose how it will pay for its share of the plant expansion. And each locality also will decide whether its rates will increase - and the amount.
Kit Kiser, Roanoke's director of utilities and operations, said Tuesday the city probably will have a phased increase in sewer rates over several years.
It would be similar to the plan that was used to increase water rates by more than 50 percent over three years to pay for a $30 million expansion of the water system.
But it's too early to determine the size of the increase in sewer rates in Roanoke, Kiser said.
"I don't see how we can [pay for the expansion] without raising rates," said Councilman James Harvey. "Unfortunately, that is a fact of life."
Harvey, who has fought to keep sewer and water rates low, said he may propose a change in billing to ease the burden on homeowners. It might be easier for customers if the city bills them every two weeks instead of quarterly, he said.
Harvey said the plant expansion is another unfunded mandate by the state.
Elmer Hodge, Roanoke County administrator, said Tuesday the county might be able to finance its share without a rate increase.
Roanoke County has raised its rates over the past several years, so that they are higher than Roanoke's and Salem's.
"If we have to raise our rates, I think it will be smaller than the other localities," Hodge said.
Public Works Director Kurt Hodgen said Botetourt County might have to raise rates or seek a low- interest loan through the Virginia Resource Authority.
In the next two to three months, the local governing bodies are scheduled to formally approve the plant expansion agreement.
Memo: ***CORRECTION***