Morristown Utilities approved a sewer rate increase Thursday that would mean a jump of an average of $4.50 a month for a residential household with a family of four.
“I hate to do it,” said Jody Wigington, general manager and chief executive officer for Morristown Utilities. “But we knew this day was coming.”
The rate increase was approved by the Morristown Utilities Commission a 5-0 vote.
The reason for the rate increase is to help offset the utility’s existing debt balance and to help fund future capital projects in the future, especially on the wastewater side.
Morristown Utilities officials said they are trying to be proactive and have capital on hand to help fix problems with the system as they arise after finishing up a state mandated consent order in 2009 that force the utility to undertake more than $100 million of projects to the sewer system.
MU officials approved three rate increases, two which directly affect customers.
The first increase was for meter capacity and the average rate would go from $23 a month for a residence with a family of four to $25 a month. The second increase is a $1 increase per 1,000 gallons a month, which will take effect in January.
MU officials said the first 2,000 gallons are free of charge, but every $1,000 gallons after that will be an increase of $1 more. The average amount for a family of four in usage is around 4,000 to 5,000 gallons, according to Morristown Utilities.
So, by January, the average residential household could see their bill go from $51.75 a month to $56.25 a month.
The rate increase for gallons per month, though, will be capped at 1 million gallons to help make sure the largest industrial and commercial users in Hamblen County will not be overly impacted.
The Morristown Utilities Commission also approved its 2020-2021 fiscal year budget.
The overall budget was $115 million with a 3% increase.
The budget also includes $12.5 million in capital projects. The largest capital expenses this year include large substation transformers, downtown work on sprinkler systems and improvements to a pump station and gravity lines.
Clark Rucker, assistant general manager, said the utility system did see some lost revenues in April during Tennessee Gov. Bill Lee’s Safer at Home order due to COVID-19.
He said because of schools being closed for almost two months and some industries being closed, there was lower usage of electricity, water and sewer, translating to lower revenue for the utility.
One of the largest increases to the budget included health insurance. The utility did see some savings due to switching healthcare providers and lower health care usage.
MU officials said raises for employees would be postponed until a later date.