South Bend to raise sewage rates
By Patrick Myers
In a letter addressed to the City Council, Mayor Struck wrote:
"We have just completed the first round of sewer loan payment since I have come into office. This round is the fourth round of payments for the City of South Bend. Round one was in December of 2012; round two was in June of 2013. In December of 2013 the USDA Rural Development loan payment schedule started and was added to the third round of payments. There was just barely enough money in the sewer account to make those payments. For the fourth payment schedule in June 2014, the sewer account was 150,000 dollars short. That account has to balance by the end of the year. In December 2014, the fifth round of payments is due. At the current level of revenue we will fall severely short again. Unfortunately, that means we have to take action now.
“How did we get here? Mayor Heinicke foresaw this scenario and instituted a series of incremental increases for the sewer rates to be enacted over time. Mayor Church had those incremental increases rescinded within his first four months in office. The increases were necessary to prevent the situation we are now facing. Our loan payments would have been met had those increases been instituted.
“In order to balance the sewer account by the end of the year and to continue to make our future loan payments we need to take action now. We need a $20 increase beginning no later than August 1, 2014 per account in order to maintain solvency. . . The final reading will be on the July 28 council agenda and will be voted on at that time to become effective August 1 if passed.
“Our hands are tied. I am sick at heart to have to give you this information, but we have to face reality. Sometimes reality isn't fun."
“I am extremely upset, because we were told, and I wish I could put my hands on that discussion where the question was asked specifically, ‘Are we going to be okay with stopping these rate increases?’ and everybody was assured, ‘Yes, we will be okay,’ Council Member Pat Neve said. “And that was the only reason that it was approved. And it wasn’t just one person that said we were going to be okay, we were assured by city hall that we would be okay. . . Now, $20 a month and are we going to be okay?”
"Yes, I've penciled out the numbers, this gives us only a cushion of only $30,000 at the end of the year,” Mayor Struck responded.
The second reading of the rate increase and the next South Bend City Council meeting is July 28 at 5:30.