Council approves six percent utility increase

The Sundance City Council has approved a six percent increase on utility rates that will become effective at the beginning of next year. The increase was deemed necessary partly to ensure the city’s enterprise accounts are paying for themselves and partly due to the loss of income the city expects from sales tax over the next year because the current iteration of the sixth cent tax has run its course.

It’s “hard to compensate” for the loss of the sixth cent, said Clerk Treasurer Kathy Lenz. The budget does not contain much fluff and, when it comes to making cuts, it’s usually in the $100 or $500 range.

Meanwhile, as enterprise accounts must pay for themselves, the city has been following the advice given during a rate study performed in 2008 that rates should be increased by a modest amount each year.

The overall increase on water and sewer amounts to around a dollar on an average account, said Lenz. Meanwhile, Public Works Director Mac Erickson has revamped the garbage rate sheet to make it more transparent and fair for commercial users. The base rate will be increasing from $48 to $55, while any additional garbage use on top of this will be calculated according to gallons.

“The garbage structure was a mess, hard to track,” he said. “This cleans it up.”

Using a campground as an example, he explained to the council that such a business would only pay the “slow rate” of $55 during the off season when they were not generating much garbage. During the busy season, they would be charged according to the number of containers they are using.

Council Member Callie Hilty shared her approval of the new structure, stating that it is transparent and easy to understand, so customers will be paying for exactly what they are using.

The increase is not that much for customers, but will lead to a significant increase for the city, said Erickson. He reasoned that a business generating a large amount of garbage is probably also generating revenue and can afford to pay for that additional garbage.

Mayor Paul Brooks spoke to the loss of the sixth cent tax revenue and the fact that the state has not increased the $105 million it distributes to towns and counties for inflation as motivational factors in the city’s decision to solidify its utility income.

“There is some compulsion to not raise rates, but there are some pretty good reasons to raise it,” he said.

Council Member Jana McLean pointed out that rates in some surrounding communities are now at almost double the dollar amount charged in Sundance. The mayor agreed that the city is still among the more reasonably priced places to live.

Praising the city staff for doing a “fabulous job” with the rate proposal, Brooks commented, “I do think you’re trying to place the burden where the burden belongs” and stated that he wishes the forecast from the state was better, but it is not. A motion was passed to move ahead with the rate increase.