Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, June 7, 1995 TAG: 9506070089
SECTION: VIRGINIA PAGE: C-5 EDITION: NEW RIVER VALLEY
SOURCE: PAUL DELLINGER STAFF WRITER
DATELINE: PULASKI LENGTH: Medium
Mayor Andy Graham broke a tie vote by Town Council on Tuesday on a motion to leave the sewer rates as they are, until the town administration can study the rate structure and make recommendations on it.
People knew for a year that the 5 percent water rate increase was coming. It was the last in a series of increases recommended by Ernst & Young, a consulting firm hired by the town to study its water rate structure to get the water fund out of the red.
It was the sewer rate that prompted telephone calls to Town Council members from people on fixed incomes and others who protested another hike on top of the 13 percent increase a year ago.
The budget first presented to council by its administrative staff contained a 10 percent sewer rate hike. The finance committee pushed that back to 3 percent; then, by majority vote last week, to no increase, recognizing that this would mean a deficit in the sewer fund.
Vice Mayor W.H. "Rocky" Schrader, finance committee chairman, persuaded the committee to reconsider at a meeting Tuesday morning. A deficit budget, he said, "sends a bad signal to a lot of people" and could hurt the town's bond rating.
"You create problems down the road ... The bond rating is very important," Max Beyer, finance director, told the committee. "I know it's tough, but those are the facts."
The majority shifted and the committee voted to recommend a 3 percent increase at council's regular meeting later that day.
But John Johnston, who had not been at the morning committee meeting, made a substitute motion to have no increase and to move that part of the sewer fund devoted to rehabilitating sewer lines, about $90,000, to the capital improvements fund.
Without the 3 percent increase, money for the rehabilitation program would have to come from the town's general fund. Schrader said that kind of deficit funding was exactly what he had hoped to avoid.
Supporting Johnston's motion for no increase were Alma Holston, E.G. "Junior" Black and Bettye Steger. Schrader, Roy D'Ardenne, Eddie Hale and John Stone voted against it. Graham, the mayor, voted for the motion saying he thought money could be found in the general fund to cover the deficit.
Council passed, 6-2, another motion by Johnston to have the administration make a study of the sewer rate structure "as fast as reasonable" along the lines of the one Ernst & Young had made on water rates. Stone and D'Ardenne voted against it.
"We'll do it as soon as we can - no more than 90 days," said Town Manager Tom Combiths.
But it will be no surprise when the study recommends a sewer rate increase, likely a higher one than was proposed because, as Schrader said, "we'll have to play catch-up."
"At least in this interim we are showing the citizens we are doing everything we can," Steger said.
by CNB