No revolution, just empty chairs at utility rate work session

A photo posted on social media on Commissioner Barth Hague's public facebook page shows the make up of a city work session discussing utility rates. In the post Hague noted the empty room suggesting a lack of interest in the topic.

By Adam Strunk

In February, hundreds of Newton residents made phone calls, spoke to city commissioners and commented on social media about utility rates, driven by news stories and graphics produced by other cities and posted on line.

The din caused commissioners to call a work session to discuss utility rates more deeply.

That work session came on May 7. A single resident, not married to the mayor, attended.

“I’m going to be blunt,” Commissioner Glen Davis said. “Look at the turnout tonight. We got one concerned citizen here and we got Kathy (Valentine)’s husband. OK? I haven’t had any complaints about the water until El Dorado did their thing and I haven’t had any complaints until we decided to have this meeting tonight.”

What the rest of the city’s 19,000 plus residents missed was a broad and historical discussion of utility rates, told from the city’s perspective.

The presentation showed that pressures on the utility fund have increased over the last decade, with the city losing large customers, such as North Newton and Rural Water District 1, causing $850,000 in lost revenue, annually.

From 2012-2015, City budgets ballooned by 24 percent, from a $40,907,000 expenditure limit in 2012 to $50,929,000 in 2015, according to city budget books available online.

In turn, city commissions increased reliance on its utility funds to keep property taxes low.

Transfers jumped by $350,000 in 2012, $150,000 in 2013 and by $300,000 in 2014, meaning that around $800,000 more dollars were transferred from utilities in 2015 than 2012 for property tax relief, according to the presentation.

For context, during that time period, property taxes increased by approximately six mills, according to information provided by the Harvey County Clerk.

With budgets growing, transfers increasing and large customers leaving, utility rates went up for Newton residents over that period.

Water rates increased from $36.55 in 2012 to $41.45 in 2015, and have remained flat since.

Sanitation fees, after remaining flat for at least five years, increased from $18.87 to $21.94 a month over the 2012-2015 time period.

The largest increase was in Newton sewer rates, which jumped from $49.35 to $82.05 over 2012-2015, with 38 percent of a monthly sewer fee tacked on to support the Newton’s sewer plant.

In total, average bills for the usage of 600 cubic feet increased from around $100 to $140 by 2015, again, mostly leveling off.

All of the numbers were available in the city presentation and are available on the city website.

The presentation also discussed the reasoning of the city using utility revenues — about a quarter of each dollar — to offset property taxes.

The presentation claimed that approximately 35 percent of property value in the city was tax exempt and the rates were a way for past commissions to make sure properties, such as churches, schools and non-profit organizations, nursing homes and hospitals contributed to city revenues as they didn’t pay property taxes.

Those organizations shown as examples included Newton Medical Center, churches, schools, Asbury Park, Kansas Christian Home, Presbyterian Manor, Prairie View and Ember Hope. Many existed before 2012, when the city began to up utility transfers to pay for tax relief.

Briefly, city engineer Suzanne Loomis spoke on the cost of dropping rates and estimated that for every $1 dropped in utility rates, the city would have to raise property taxes by one mill to make up the shortfall.

Following the presentation, Davis said it he didn’t think it would help the city to lower rates with the sewage plant seven years from being paid off. He said he understood if that wouldn’t make him popular.

“I sat with a group of men and they said it doesn’t matter what town you live in, people complain about their utility bills and people don’t want to live without their services and those cost money.”

Valentine said after the presentation she did not believe decreasing rates would be a good idea.

“You know what, there is so much here that people aren’t hearing and could have heard,” she said of the presentation.

* The work session started 10 minutes late. According to Glen Davis, the local Rotary Club meeting had a good speaker talking about economic development.
He left the meeting and said commissioners Leroy Koehn and Rod Kreie should be arriving soon.

Kreie and Koehn then got stuck behind a train and had trouble entering City Hall as the front entrance is under repairs.