Reports show that Fort Smith water rates below most comparable cities

Fort Smith’s water rates come in below many cities in Arkansas, but the combined water and sewer rate for residential customers is above the state average. However, Fort Smith rates are well below most other regional cities operating under a federal consent decree.

City officials are reviewing water rates because projects suggest revenue from existing rates is not enough to cover bond covenants, and could require using at least $8 million from utility department reserve funds to meet the shortfall in 2024 alone.

A Burns and McDonnell Engineering water rate study conducted for the city shows the average water and sewer bills for residential customers in Arkansas is $57 for those using 5ccf a month. David Nauman, with Burns and McDonnell Engineering, said 5 ccf – 1 ccf equals 748 gallons – is the most common usage rate for residential customers.

The combined rate for Fort Smith residential customers using 5ccf a month is about $65, according to the water rate study. The study showed that about $15 of that was for water and the remaining $50 is for sewer. Naumann said the average water bill for Fort Smith is roughly $17.

DASHBOARD COMPARISONS
A University of North Carolina water rate dashboard shows that the average water rate in Fort Smith in 2021, the last year it had listed on the site, was $21.36, but that was looking at the average for all customers regardless of usage.

The UNC dashboard listed 2021 water rates for some of the cities in the state are:
Bentonville – $51.88
Conway – $51.13
Fayetteville – $25.79
Greenwood – $39
Hot Springs – $21.04
Jonesboro – $14.12
Rogers – $38.12
Russellville – $37.10
Springdale – $22.80

The UNC dashboard lists the minimum annual water fee in the state in 2021 as $5.59 and the highest as $96.20, with a median rate of $37.43, which Fort Smith falls well below. The information on the UNC dashboard does not always sync with information provided in the Burns and McDonnell water study, but the UNC dashboard does not stipulate for what size customer the information is provided.

BURNS AND MCDONNELL COMPARISONS
Burns and McDonnell looked at several cities to see how Fort Smith’s water rate compared. Springdale’s average monthly rate for residential customers using 5 ccf of water for water and sewer is $40 – approximately $20 for water, $20 for sewer. Fayetteville had a combined average monthly rate of $59 – approximately $21 for water and $38 for sewer. Bentonville’s combined total was $68 with $22 of that for water and $46 for sewer.

Burns and McDonnell compared Fort Smith’s typical water bill to other U.S. cities, showing the Fort Smith water rate was on the lower side. The numbers they provide were for residential customers with an average monthly use of 5ccf. The Arkansas average, according to the report, is $22, above the Fort Smith average of $17. Cities listed included:
Bentonville – $21.22
Columbia, S.C. – $16-$17
Fayetteville – $35-36
Fort Smith – $17
Lawton, Okla. – $51
Shreveport, La. – $15-$17

Though Fort Smith’s water rate is lower than the state average, when water and sewer are combined, the bill is higher than the state average. The Arkansas average monthly total for both charges for customers using 5 ccf a month is $57. Fort Smith’s average for residential customers using 5 ccf pays about $65. Other regional cities under a consent decree have the following combined fee, according to the water study:
Shreveport – about $68, $18 water and $50 sewer
Columbia, Mo. – about $55, $20 water and $35 sewer
Independence, Mo. – about $76, $25 water and $51 sewer
St. Louis – about $75, $20 water and $55 sewer

RATE HISTORY, PROPOSED CHANGES
Fort Smith’s household water and sewer costs have risen about 5% on average over the past several years, according to the water rate study. This is consistent with the national average, Naumann said. He said nearly all of the city’s incremental funding has been directed toward the sewer utilities consent decree.

The national Water and Sewer Index for 2000-2023 was 4.7%, Naumann said. Fort Smith shows an average 7% per year sewer increase; a 2% year average water increase and a 5% average system increase. Fort Smith has not had a water rate increase since 2011, though it had large sewer rate increases in 2015, 2016 and 2017, Naumann said.

The Fort Smith Board of Directors on April 16 tabled a water rate increase until they could have a study session to discuss the issue. That item is not included on the agenda for Tuesday’s (April 23) study session. The water rate change proposed April 16 took  a “holistic look” at the city’s entire rate structure that would bring increased rates to all types of users.

On the residential side, the lowest base rate for water (not including sewer or solid waste fees) beginning July 1, would be $6, up from $4.97. Residential customers using 1-3 ccf per month would have a $2.66 charge for water; those using 4-7 ccf would have a $3.86 charge; those using 8-16 ccf would have a $5.25 charge; and those using more than 17 ccf for the month would have $6.75 charge for water.

“Most residential customers will see less impact, some as low as $1.03,” Naumann has said. “Impact to low-income residential customers will be 50% lower.”

After years of failing to maintain water and sewer infrastructure to federal standards, the city entered into a federal consent decree with the U.S. Environmental Protection Agency (EPA) and U.S. Department of Justice in late 2014. The consent decree required the city to make an estimated $480 million worth of sewer upgrades over the course of 12 years.