Fort Smith Board tables sewer rate increase

The Fort Smith Board of Directors on Tuesday (Feb. 4) tabled an ordinance that would raise sewer rates by 3.5% beginning in June and raising rates every year for the next five years at the 3.5% rate. The item was tabled until the next regular board meeting set for Feb. 18.

The sewer rate increase is proposed in order for the city to pay for federal consent decree work that will allow the city to stay in compliance with governmental demands, said Interim City Administrator Jeff Dingman at Tuesday’s meeting.

“The Environmental Protection Agency (EPA) and Department of Justice (DOJ) insist on compliance with Clean Water Act regulations, and we are not in compliance,” Dingman said.

Because the city is under a consent decree, the government requires that revenue generated from user rates be used to come into compliance, Dingman said.

Between 1991-2003 the city was under an EPA administrative order. Between 2000-2015, the city spent $203.463 million to build weatherization storage basins, replace and repair sewer lines, and the P Street sewage treatment plant.

The consent decree went into effect Jan. 2, 2015. The city stayed in compliance with that federal order between 2015-2018. An historic flood in 2019 damaged sewer infrastructure, damaging 14 pump stations, some of which were completely destroyed, and resulting in the city being noncompliant on consent decree work, Dingman said. The COVID-19 pandemic in 2020 caused more significant delays.

“We have fallen out and are no longer in compliance,” Dingman said.

In 2022, city voters passed a 0.625% cent sales tax dedicated to consent decree capital projects. When that tax passed, the city pledged there would be no sewer rate increase for three years. That tax generated $35.392 million through December 2024. The total amount contracted and spent on the consent decree work to date from that tax is $30.019 million, Dingman said.

The proposed rate increase revenue would pay sewer operating costs, and maintenance and debt service costs. The city would then use the 0.625% sales tax revenue and are proposing to use 0.375% of the 1% sales tax dedicated to streets, bridges and associated drainage to also pay for mandated consent decree capital improvement projects.

The proposed increase would raise the sewer base charge from $4.50 to $4.66 per month. The rate for sewer volume charge per 1 ccf would increase from $8.45 to $8.75 on June 1 and then 3.5% on Jan. 1 for years 2026-2030. Ballpark estimates show the rate increase will raise $629,000 this in 2025 and $1.5 million in 2026.

Several residents spoke about the proposal during a public hearing regarding the rate increase. Some said citizens were already facing high costs of living and could not afford the increase. Others recognized that the city has to raise rates to meet requirements of the consent decree.

Directors Christina Catsavis and Lee Kemp noted that the federal government would like to see a 19% increase each year.

“I’ll lock it in at 3.5%, so I can keep the government from coming in and make us raise rates by 19%,” Kemp said.

Citing the need for more information and discussion, a majority of board members tabled the vote on the rate increase.